Form 10-K GROUND LEASE

Exhibit 10.145 Tiffany & Co. Report on Form 10-K GROUND LEASE BY AND BETWEEN RIVER PARK BUSINESS CENTER, INC., LANDLORD -AND- TIFFANY AND COMPANY, TENANT TABLE OF CONTENTS

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-ii- GROUND LEASE THIS LEASE made as of the 29th day of November , 2000, between RIVER PARK BUSINESS CENTER, INC., a Delaware corporation, having an office at 47 Parsippany Road, Whippany, New Jersey 07981 (herein called "Landlord") and TIFFANY AND COMPANY, a New York corporation having an office at 727 Fifth Avenue, New York, New York 10022 (herein called "Tenant"). WITNESSETH: For good and reasonable consideration, Landlord and Tenant hereby agree as follows: ARTICLE 1 - DEFINITIONS 1.1 As used herein, the following terms and phrases shall have the meanings indicated, which meanings shall be applicable to the singular and plural nouns and verbs of any tense: (a) Additional Rent: All monies hereunder due from Tenant to Landlord other than the Fixed Annual Rent. (b) Alteration: Defined in Section 10.1(a). (c) Approvals: Defined in Section 11.7. (d) Approvals Date: The day after the day by which any appeal of the approval by the Hanover Township Planning Board of Tenant's "Application" (as defined in Section 11.2) for the "Initial Improvements" (as defined in Section 11.2) must be commenced, or, if any appeals have been commenced, the date on which such appeals are finally resolved in Tenant's favor, and are no longer subject to any right of appeal. (e) Base Price Index: The Price Index for the month in which the Rent Commencement Date occurs. (f) Building: Defined in Section 11.2(a). (g) Commencement Date: Defined in Section 2.2. (h) Contamination: The uncontained or uncontrolled presence of or release of Hazardous Materials into any environmental media from, upon, within, below, or into the Demised Premises, so as to require remediation, cleanup or investigation under any applicable Environmental Law. (i) Demised Premises: The Land, together with the Improvements, and all easements, rights and appurtenances to the Land. (j) Environmental Laws: All Legal Requirements concerning human health and the environment. (k) Event of Default: Defined in Section 16.1. (l) Fee Mortgage: Any mortgage, as amended or modified from time to time, given by Landlord on its fee interest in the Land or this Lease. (m) Fee Mortgagee: The holder at any time of a Fee Mortgage, and prior to the placement thereof Fee Mortgagee shall mean the issuer of a commitment for such Fee Mortgage. (n) Fixed Annual Rent (also referred to herein as the "Fixed Rent"): Defined in Section 3.1(a). (o) Hazardous Materials: Any "hazardous chemical," "hazardous substance" or similar term as defined in any present and future Environmental Law, including, but not limited to, the Comprehensive Environmental Response, Compensation and Liability Act of 1980, as amended, 42 U.S.C. 9601, et. seq. ("CERCLA"); the Resource Conservation and Recovery Act of 1976, as amended, 42 U.S.C. 6901 et. seq. ("RCRA"); the Occupational Safety and Health Act, 29 U.S.C. 651 et. seq. ("OSHA"); the New Jersey Industrial Site Recovery Act, as amended, N.J.S.A. 13:1K-6 et. seq. ("ISRA"); the New Jersey Spill Compensation and Control Act, as amended, N.J.S.A. 58:10-23. 11b et. seq. ("Spill Act"); the New Jersey Underground Storage of Hazardous Substances Act, as amended, N.J.S.A. 58:10A-21 et. seq.; the New Jersey Solid Waste Management Act, as amended, N.J.S.A., 13:1E-1 et seq.; and the New Jersey Water Pollution Control Act, as amended, N.J.S.A. 58:10A-1 et. seq., as each may subsequently be amended. (p) Impositions: All Real Estate Taxes, occupancy taxes, personal property taxes, water and sewer charges other than water and sewer rents (to the extent such water and sewer rents are included in Real Estate Taxes), and all other taxes and governmental charges, general or special, ordinary or extraordinary, foreseen or unforeseen, of any kind or nature whatsoever which shall or may during the Term be assessed, levied, charged, confirmed or imposed upon or become payable out of or become a lien on the Demised Premises, or any part thereof, or the rent and income received by or for the account of Tenant from any subtenants or for any use or occupancy of the Demised Premises. No franchise, corporate, estate, inheritance, succession, capital levy or capital stock tax of Landlord, and no income, profit or revenue tax upon the income or receipts of Landlord, shall be included as Impositions, except that if at any time during the Term the methods of taxation shall be altered so that in addition to or in lieu of or as a substitute for the whole or any part of any Real Estate Taxes there shall be levied, assessed or imposed (i) a tax, license fee or other charge on the rents received or (ii) any other type of tax or other imposition in lieu of, or as a substitute for, or in addition to, the whole or any portion of any Real Estate Taxes, then the same shall be included as Impositions under this Lease to the extent that such amounts would be payable if the Demised Premises were the only property of Landlord subject thereto. (q) Improvements: The Building and other improvements including, without limitation, site improvements and Alterations constructed on the Land from time to time. (r) Initial Improvements: Defined in Section 11.2. 2 (s) Intentionally Deleted. (t) Institutional Lender: Any commercial, national or savings bank, savings and loan association, trust company, insurance company, real estate investment trust or pension or retirement fund. (u) Insurance Requirements: The requirements, whether now or hereafter in force, of any insurer or a fire insurance rating organization or any other organization performing the same or similar functions, applicable to the Demised Premises, or the use or manner of use thereof. (v) Land: All that certain plot, piece or parcel of land in the Township of Hanover, County of Morris and State of New Jersey, generally known as Block 8901, Lots 3 and 11, and more particularly described in Exhibit A attached hereto and incorporated herein by reference. (w) Leasehold Mortgage: Any mortgage, deed of trust or similar security instrument which is a lien on the leasehold estate of Tenant created by this Lease, as such security instrument may be amended or modified from time to time. (x) Leasehold Mortgagee: The holder at any time of a Leasehold Mortgage, and prior to the placement thereof "Leasehold Mortgagee" shall mean the issuer of a commitment for such Leasehold Mortgage. (y) Legal Requirements: All laws, statutes, ordinances, orders, directives, opinions, rules, regulations and requirements of all federal, state and municipal governments, and the appropriate agencies, offices, bureaus, departments, boards and commissions thereof, whether now or hereafter in force, including, but not limited to Environmental Laws and all covenants, agreements, restrictions and encumbrances contained in any Permitted Encumbrance applicable to the Demised Premises or the use or manner of use of the foregoing. (z) Notice of Termination: Defined in Section 16.1. (aa) Other Impositions: The Impositions other than Real Estate Taxes. (bb) Price Index: The Consumer Price Index for All Urban Consumers, All Items, New York - Northeastern New Jersey, published by the Bureau of Labor Statistics of the United States Department of Labor. If at any time said Consumer Price Index is no longer issued, then the term "Price Index" shall mean a substitute or successor index selected by Landlord and Tenant jointly, or, in the event of their failure to agree, within thirty (30) days after notice by one to the other to such effect, by arbitration in accordance with Article 30 hereof, adjusted, if necessary to be comparable, to said Consumer Price Index. (cc) Person: The word "person" shall mean a natural person, a partnership, a corporation, a limited liability company, or any other form of business or legal association or entity. 3 (dd) Real Estate Taxes: All real estate taxes, assessments and water and sewer rents, general or special, ordinary or extraordinary, foreseen or unforeseen, of any kind or nature whatsoever attributable to the Demised Premises, or any part thereof. (ee) "Rent" shall mean both Fixed Annual Rent and Additional Rent. (ff) Rent Commencement Date: Subject to the last sentence of Section 11.2(b)(ii) hereof, April 1, 2002. (gg) Taking: Defined in Section 14.1(a). (hh) Tenant's Work: Defined in Section 11.6. (ii) Term: The thirty (30) year period described in Section 2.2., as same may be extended pursuant to the terms hereof, but in any event the Term shall end on any date when this Lease is sooner terminated pursuant to its terms or applicable law. (jj) Unavoidable Delay: Any delay suffered by a party to this Lease resulting from any (i) act of God, (ii) fire, flood, earthquake, blizzard, storm or other casualty, (iii) industry-wide strike, lockout or other labor dispute, (iv) riot, insurrection, civil commotion, sabotage, vandalism or enemy or hostile governmental action, (v) industry-wide inability to procure labor, materials or supplies, (vi) transportation delay or freight embargo, (vii) Legal Requirements of an unusual nature, including, without limitation, rationing or restriction in respect of any construction work or the use of labor or materials, (viii) judicial or other legal restriction or proceeding, actual or threatened, pertaining to or affecting the performance of any covenant to be performed hereunder, (ix) failure or delay by the other party to this Lease in the full and prompt performance of its obligations under this Lease, (x) failure or delay by any contractor, subcontractor, supplier or materialman, or (xi) other condition beyond the control of the party suffering the delay provided that (1) lack of funds shall not be deemed beyond the control of a party, (2) the affected party must take all reasonable steps to avoid or minimize the delay and (3) the affected party gives the other party notice of the delay and the affected party's best estimate of the projected duration of the delay promptly after the occurrence of the above events. ARTICLE 2 - DEMISE AND TERM 2.1 Upon and subject to the terms and conditions set forth herein, Landlord hereby leases to Tenant, and Tenant hereby hires from Landlord, the Demised Premises for the Term. Each party hereby expressly covenants and agrees to observe and perform all of the obligations herein contained on its part to be observed and performed. 2.2 The Term shall be the period commencing on the date hereof (the "Commencement Date") and continuing to and ending at midnight of the date which is the thirtieth (30th) anniversary of the Rent Commencement Date (as herein defined) (hereinafter referred to as the "Expiration Date") unless this Lease is sooner terminated. However, if the Term is extended by Tenant's effective exercise of Tenant's right to extend the Term, the "Expiration Date" shall be changed to the last day of the latest extended period as to which Tenant shall have effectively exercised its right to extend the Term. Promptly following the Rent 4 Commencement Date, the parties hereto shall enter into an agreement in form and substance reasonably satisfactory to Landlord and Tenant setting forth the Rent Commencement Date, but the failure to do so shall not affect the Rent Commencement Date or the Expiration Date. 2.3 (a) Tenant, subject to the provisions of this Section 2.3, by notice ("Extension Notice") to Landlord to be delivered at least twelve (12) months prior to the Expiration Date, may extend the term of this Lease for an additional twenty (20) years (the "Extension Term"), beginning at midnight on the thirtieth (30th) anniversary of the Rent Commencement Date and expiring on the fiftieth (50th) anniversary of the Rent Commencement Date. Tenant shall not be permitted to extend the Term pursuant to this Section 2.3 if this Lease is not in full force and effect or there is an uncured Event of Default at the time of delivery of the Extension Notice to Landlord. If Tenant does so extend the Term, it shall be on all of the terms and conditions contained herein except: (i) Fixed Annual Rent shall be redetermined in accordance with Section 2.3(b) and (ii) Tenant shall have no right to further extend the Term.(b) (i) During the Extension Term, Fixed Annual Rent shall equal the greater of (A) the fair market rental value of the Demised Premises for a twenty (20) year lease on the date which is the Expiration Date of the initial Term of this Lease (without extension), on the basis that the Demised Premises is then unencumbered by this Lease, and taking into account the facts that Landlord will have no vacancy period, no broker's commission, and no build-out obligation; and (B) the Fixed Annual Rent for the final year of the initial Term. (ii) After receipt of the Extension Notice, Landlord and Tenant shall work together in good faith to establish the Fixed Annual Rent for the twenty (20) year Extension Term. If, within ninety (90) days of delivery of the Extension Notice, no agreement has been reached, and memorialized in writing, as to what the Fixed Annual Rent will be, either party may submit the matter to arbitration pursuant to Article 30 for a binding determination thereon. (iii) If the Fixed Annual Rent for the Extension Term is not determined by the first day of the Extension Term Tenant shall continue to pay Fixed Annual Rent at the same rate as was being paid on the Expiration Date of the original Term until such determination is made. Once the determination is made, then commencing on the first day of the next calendar month, and continuing thereafter in accordance with Section 3.2, Tenant shall pay 1/12th of the new Fixed Annual Rent. Additionally, there will be a cash adjustment, payable within thirty (30) days of such determination, from Landlord to Tenant or Tenant to Landlord, as appropriate, to correct any overpayment or underpayment for the period commencing on the first day of the Extension Term and ending on the last day of the calendar month in which the determination of the new Fixed Annual Rent is made. ARTICLE 3 - FIXED ANNUAL RENT 3.1 (a) The fixed annual rent ("Fixed Rent" or "Fixed Annual Rent") for the period from the Rent Commencement Date to the date which is the day immediately preceding the fifth (5th) anniversary of the Rent Commencement Date, is Nine Hundred Sixty Five Thousand ($965,000) Dollars. 5 (b) Fixed Annual Rent shall be adjusted on the 5th, 10th 15th, 20th and 25th anniversary of the Rent Commencement Date to equal the sum of: (A) the Fixed Annual Rent on the day prior to such adjustment, and (B) seventy (70%) percent of the product of: (y) the Fixed Annual Rent on the day prior to such adjustment, and (z) a fraction, the numerator of which is the difference between the Price Index on the date such Fixed Annual Rent adjustment is effective and the Price Index on the date five (5) years prior to such adjustment date, i.e., the Rent Commencement Date, or 5th, 10th, 15th, or 20th anniversary thereof, as appropriate, and the denominator of which is the Price Index on the date five (5) years prior to such adjustment date, i.e., the Rent Commencement Date, or 5th, 10th, 15th, or 20th anniversary thereof, as appropriate. 3.2 Subject to this Section 3.2, Tenant shall pay the Fixed Annual Rent to Landlord in equal monthly installments in advance on the first day of each calendar month during the Term. If the Rent Commencement Date is not the first day of a calendar month, Fixed Annual Rent for the period commencing on the Rent Commencement Date and ending on the last day of the calendar month during which the Rent Commencement Date occurs shall be apportioned and shall be paid on the Rent Commencement Date. If the Expiration Date is not the last day of a calendar month, Fixed Annual Rent for the period commencing on the first day of the calendar month during which the Expiration Date occurs and ending on the Expiration Date shall be apportioned and shall be paid on the first day of such calendar month. Fixed Annual Rent for the first full calendar month of the Term following the Rent Commencement Date shall be paid to Landlord on the date hereof. In accordance with Article 11, this first month's Fixed Annual Rent shall be refunded to Tenant upon Tenant's termination of the Lease in accordance with Article 11. 3.3 The Fixed Annual Rent and all Additional Rent and all other charges payable by Tenant hereunder shall be paid promptly when due, without notice or demand therefor, and without deduction, abatement, counterclaim or set-off of any amount for any reason whatsoever except as herein expressly provided to the contrary. All amounts payable by Tenant to Landlord under the provisions of this Lease shall be paid to Landlord in lawful money of the United States at the place provided herein for notices to Landlord or at such other place and/or to such other person as Landlord may from time to time designate by notice to Tenant. Until such time as Landlord shall designate otherwise, all amounts payable by Tenant to Landlord under the provisions of this Lease shall be paid to Landlord's address set forth above. 3.4 In the event that any installment of Rent due hereunder shall be overdue for five (5) days, such overdue Rent, at Landlord's option, shall bear interest at a per annum rate equal to five percent (5%) over the "prime rate" as established by Citibank, N.A. (or its successors) from time to time or the maximum rate permitted by law, whichever is less, commencing on the sixth (6th) day after the due date and continuing thereafter until paid (the "Late Payment Rate"). ARTICLE 4 - NET LEASE AND INDEMNITY 4.1 (a) Except as herein expressly provided to the contrary, this Lease is intended to be, and shall be construed as, an absolute net lease, whereby under all circumstances and conditions (whether now or hereafter existing or within the contemplation of the parties) the Fixed Rent shall be absolutely net to Landlord, and Tenant shall pay any and all claims, liabilities, losses, damages, expenses and costs (including, without limitation, reasonable 6 attorneys' fees), obligations and charges of every kind and nature whatsoever, which accrue on or after the Rent Commencement Date (or, if expressly set forth herein, the Commencement Date), and throughout the Term in respect of or in connection with the Demised Premises and the ownership, leasing, operation, management, maintenance, repair, rebuilding, restoration, use or occupation thereof or any portion thereof, other than any interest, principal or any other charge in connection with any Fee Mortgage. (b) Except to the extent expressly provided for in this Lease: (i) no happening, event, occurrence, or situation during the Term whether foreseen or unforeseen, and however extraordinary, shall permit Tenant to quit the Demised Premises or surrender this Lease or shall relieve Tenant from Tenant's obligations hereunder; and (ii) Tenant waives any rights now or hereafter conferred upon it by Legal Requirements, or otherwise, to quit the Demised Premises, or any part thereof, to surrender this Lease or to claim any abatement, diminution, reduction or suspension of Rent on account of any such event, happening, occurrence or situation. 4.2 (a) Tenant shall indemnify and hold harmless Landlord and its partners, members, joint venturers, directors, officers, agents, servants and employees (each, a "Tenant Indemnitee") from and against any and all claims arising from or in connection with (i) the conduct or management of the Demised Premises or of any business therein, or any work or thing whatsoever done, or any condition created (other than by Landlord or its partners, joint venturers, directors, officers, agents, servants or employees) in the Demised Premises during the Term or, if caused by Tenant, during the period of time, if any, prior to the Commencement Date that Tenant may have been given access to the Demised Premises; (ii) any act, omission or negligence of Tenant or any of its subtenants or licensees or its or their partners, members, joint venturers, directors, officers, agents, employees or contractors, including, without limitation, pursuant to Sections 5.7 and 6.3; (iii) any accident, injury or damage whatsoever (unless caused solely by Landlord's negligence) occurring in the Demised Premises; and (iv) any breach or default by Tenant in the full and prompt payment and performance of Tenant's obligations under this Lease; together with all costs, expenses, liabilities, damages, and penalties incurred in connection with each such claim or action or proceeding brought thereon, including, without limitation, all reasonable attorneys' fees and expenses incurred in connection with each such claim or motion or proceeding and in enforcing this indemnification. In case any action or proceeding is brought against Landlord and/or its partners, members, joint venturers, directors, officers, agents and/or employees in connection with the conduct or management of the Demised Premises or by reason of any claim referred to above, Tenant, upon notice from Landlord shall, at Tenant's cost and expense, resist and defend such action or proceeding by counsel of Tenant's choice reasonably satisfactory to Landlord. (b) If any claim, action or proceeding is made or brought against any Tenant Indemnitee, which claim Tenant shall be obligated to indemnify against pursuant to the terms of this Lease, then, upon demand by any such Tenant Indemnitee, Tenant, at its sole cost and expense, shall defend such claim, action or proceeding by the attorneys of Tenant's choice, such choice to be subject to the Tenant Indemnitee's approval, which approval shall not be unreasonably withheld or delayed. The attorneys for Tenant's insurer are deemed approved by all Tenant's Indemnitees. 7 4.3 (a) Landlord shall indemnify and hold harmless Tenant and its members, partners, joint venturers, directors, officers, agents, servants and employees (each, a "Landlord Indemnitee") from and against any and all claims arising from or in connection with any breach or default by Landlord in the full and prompt payment and performance of Landlord's obligations set forth in Article 11 of this Lease; together with all costs, expenses, liabilities, damages, and penalties incurred in connection with each such claim or action or proceeding brought thereon, including, without limitation, all reasonable attorneys' fees and expenses incurred in connection with each such claim or motion or proceeding and in enforcing this indemnification. In case any action or proceeding is brought against Tenant and/or its partners, members, joint venturers, directors, officers, agents and/or employees by reason of any claim referred to above, Landlord, upon notice from Tenant shall, at Landlord's cost and expense, resist and defend such action or proceeding by counsel of Landlord's choice reasonably satisfactory to Tenant. (b) If any claim, action or proceeding is made or brought against any Landlord Indemnitee, which claim Landlord shall be obligated to indemnify against pursuant to the terms of this Lease, then, upon demand by any such Landlord Indemnitee, Landlord, at its sole cost and expense, shall defend such claim, action or proceeding by the attorneys of Landlord's choice, such choice to be subject to the Landlord Indemnitee's approval, which approval shall not be unreasonably withheld or delayed. The attorneys for Landlord's insurer are deemed approved by all Landlord Indemnitees. ARTICLE 5 - REAL ESTATE TAXES AND OTHER IMPOSITIONS 5.1. Tenant shall pay directly to the relevant taxing authority as Additional Rent all of the Real Estate Taxes accruing on or after the Rent Commencement Date and thereafter throughout the Term in respect of the Demised Premises. Tenant shall deliver to Landlord copies of the receipted bills or other reasonable evidence of such payment within thirty (30) days following any such payment. 5.2. Tenant shall also pay, as herein provided, all of the Other Impositions levied, assessed or imposed upon or relating to all or any part of the Demised Premises or arising from or levied against the ownership, leasing, operation, use, occupancy or possession of all or any part of the Demised Premises accruing on or after the Rent Commencement Date and thereafter throughout the Term. 5.3. Unless Tenant receives the same directly from the taxing authority, Landlord shall submit to Tenant true copies of the Real Estate Tax bills and any bills which shall be received by Landlord for Other Impositions (not including Other Impositions for which Tenant shall be billed directly or for which Tenant shall be required by law to file a tax return), together with a statement of the facts and information needed to calculate the amounts due and payable from Tenant for such Real Estate Taxes and Other Impositions pursuant to the provisions of Section 5.1 and Section 5.2. 5.4. Tenant shall also pay when due and before any penalty or interest shall be charged thereon directly to the appropriate taxing or other governmental authority all of the Other Impositions for which Tenant shall be billed directly or for which Tenant shall be required by 8 law to file a tax return, and Tenant shall deliver to Landlord (a) copies of receipted bills for such Other Impositions as shall be paid by Tenant directly to any taxing or other governmental authority within fifteen (15) days after receipt of such bills by Tenant and (b) copies of tax returns filed for such Other Impositions as shall be paid directly by Tenant within fifteen (15) days after payment of such Other Impositions. 5.5.If, by law, any Impositions may be payable at the option of the taxpayer in installments (whether or not interest shall accrue on the unpaid balance thereof), Landlord shall exercise the option to pay same in installments. The installments (and interest thereon) as the same become due and payable shall be included in the computation of Impositions, except that the entire unpaid amount thereof shall be included in the computation of Impositions on the installment payment date thereunder immediately prior to the date which is one year before the expiration of the Term, subject to the apportionment described in Section 5.6. 5.6.Impositions shall be apportioned between Landlord and Tenant as of the Rent Commencement Date and the Expiration Date or sooner termination of this Lease, so that Tenant shall pay only the portion of the Impositions allocable to the Term. 5.7.Tenant has the sole and exclusive right to contest the amount or validity of Impositions allocable to years falling wholly or partially within the Term, in any manner permitted by law, in the name of Tenant, and whenever necessary in the name of Landlord, provided and upon condition that Tenant notifies Landlord of such contest and conducts such contest with due diligence and in good faith and that such contest shall be without cost, liability or expense to Landlord and provided further that Tenant pay such Impositions, unless not legally obligated to do so, pending the outcome of any such contest. Landlord shall cooperate with Tenant and shall execute any documents or pleadings reasonably required for such purpose. Such contest may include appeals from any judgment, decree or order until a final determination is made by a court or governmental department or authority having final jurisdiction in the matter. Tenant will be entitled to 100% of the net amount of any remission, refund, or credit (retrospective or, as to the balance of the Term, prospective) of Impositions paid or payable by Tenant after payment of all related costs and expenses, and Landlord shall be entitled to the remainder of such net amount. Tenant has no obligation to Landlord to undertake, or once undertaken complete, such contest or, except to the extent that a remission refund, or credit relating to the Demised Premises is actually received by Tenant, any liability to Landlord for any amount pursuant to this Section 5.7. Further, Landlord acknowledges Tenant has the sole and exclusive right to conduct such contest as Tenant determines in its sole discretion, including without limitation the right to settle any contest on such terms as Tenant approves in its sole discretion, without obligation or liability to Landlord. ARTICLE 6 - USE AND COMPLIANCE 6.1.Tenant may use and occupy the Demised Premises for any lawful purpose. Tenant shall not use, improve, occupy or permit or suffer the use, improvement or occupancy of the Demised Premises or any part thereof in any manner which would constitute a violation of Legal Requirements or Insurance Requirements or make void or voidable any insurance then in force with respect thereto, unless such insurance is promptly replaced with substantially similar coverage, or constitute a public or private nuisance. 9 6.2.(a) Tenant, at Tenant's sole cost and expense, shall promptly comply or cause compliance with all Legal Requirements and Insurance Requirements, foreseen or unforeseen, ordinary as well as extraordinary, whether or not the same shall presently be within the contemplation of the parties hereto and, during the first twenty years of the Term following the Rent Commencement Date, whether or not the same shall require expenditures ("Capital Expenditures") which, in accordance with GAAP, are to be capitalized, including, without limitation, any structural or extraordinary repairs or Alterations. (b) (i) If, after the twentieth anniversary of the Rent Commencement Date, during the balance of the Term, as extended, compliance with Legal Requirements or Insurance Requirements, requires Capital Expenditures, Landlord and Tenant shall be responsible for the cost thereof, in accordance with Section 6.2(b)(ii), provided, however, to the extent such compliance requiring Capital Expenditures is necessitated by Tenant's change in the use of the Demised Premises from a warehouse/distribution facility with affiliated office space to a materially different use, Tenant shall be solely obligated for the cost of such Capital Expenditures. Upon receiving notice of such a requirement, Tenant shall deliver a notice to Landlord, which notice shall comply with the last sentence of this Section 6.2(b)(i), and which shall include: (A) notice of such requirement; (B) a plan of action including, without limitation, a description of any work to be undertaken; and (C) a budget which may include reasonable supervision fees, and an allocation for overhead, but not profit. Landlord shall have thirty (30) days from delivery of the notice to provide Tenant with whatever comments Landlord might have concerning the information delivered. Landlord and Tenant shall work in good faith to agree on a plan of action. However, if Landlord and Tenant cannot so agree within sixty (60) days of Tenant's original delivery of the described notice, either party may submit the issue to arbitration pursuant to Article 30 hereof for resolution. If Landlord does not respond to Tenant's notice within thirty (30) days of delivery of same Landlord will be deemed to have approved performance by Tenant of the suggested plan of action. Tenant's notice shall specifically set forth, in bold type, that Landlord's failure to respond within thirty (30) days shall be deemed approval of the suggested plan of action. (ii) (A) Tenant shall perform the approved (or deemed approved) plan of action for Landlord's account and at Landlord's sole cost and expense. The approved (or deemed approved) budget (so long as prepared in good faith) shall not represent a ceiling on the costs to be incurred by Landlord in Tenant's performance of the plan of action, but Tenant shall act in good faith to perform in accordance with such budget and shall keep Landlord informed of any material variations therefrom. The plan of action shall be implemented in the manner set forth in Article 8 in a good and workmanlike manner. (B) Tenant shall submit invoices for payment or reimbursement to Landlord from time to time, but no more frequently than monthly, for materials on-site, work in place, "soft" costs incurred, and other out-of-pocket costs or expenses reasonably incurred in connection with such work and in accordance with the plan of action. Invoices shall be accompanied by reasonable evidence of third party expenditures, e.g., third party invoices. Landlord shall pay Tenant's invoices within thirty (30) days of receipt. (C) Upon completion of the plan of action, the total out-of-pocket cost to Landlord of implementing same may be amortized over the useful life of the work 10 completed, but in no event more than ten (10) years, and the amortized portion of such cost allocable to the remaining initial Term hereof, without extension (if the Legal Requirement or Insurance Requirement is imposed during the initial Term), or the remaining Extension Term (if the Legal Requirement or Insurance Requirement is imposed during the Extension Term ), shall be charged to Tenant, and shall be payable to Landlord, within thirty (30) days of Landlord billing Tenant for same. Landlord and Tenant agree that if a Capital Expenditure is made in the initial Term, and the useful life of the work extends into the Extension Term (if any) Tenant shall not be obligated to pay for the portion of the cost thereof which is allocable to the Extension Term, but that the value of such work shall be taken into account, to the extent appropriate, in determining the Fixed Annual Rent for the Extension Term pursuant to Section 2.3 hereof. 6.3. Tenant, at its sole cost and expense, after notice to Landlord, may contest any Legal Requirement in any manner permitted by law, and Tenant may defer compliance therewith during the pendency of such contest, provided and upon condition that (a) such noncompliance shall not constitute a criminal act on the part of Landlord nor shall the Demised Premises or any part thereof be subject to being condemned or vacated, nor shall the certificate of occupancy for the Building be suspended, (b) such contest shall be without cost, liability or expense to Landlord, and (c) Tenant shall prosecute such contest with due diligence and in good faith. Landlord shall cooperate with Tenant and shall execute any documents or pleadings reasonably required for the purpose of any such contest. Tenant shall indemnify and hold Landlord harmless from and against any and all claims, liabilities, losses, damages, fines, penalties, costs and expenses (including without limitation reasonable attorneys' fees) in connection with Tenant's failure or delay in complying with any Legal Requirement. Tenant may terminate any such contest at any time, in which event Tenant shall promptly pay or perform all of the requirements of such contested Legal Requirement. 6.4. Other than as set forth in Section 11.3, Tenant shall obtain and keep in full force and effect any and all necessary permits, licenses, certificates, or other authorizations required in connection with the lawful and proper use, occupancy, operation and management of the Demised Premises, as same are used from time to time, and Tenant shall indemnify and hold Landlord harmless from and against any and all claims, liabilities, damages, losses, costs and expenses (including without limitation reasonable attorneys' fees) in connection therewith. 6.5. No abatement, diminution or reduction of any Fixed Annual Rent, Additional Rent or other charges payable by Tenant hereunder shall be claimed by or allowed to Tenant for any inconvenience, annoyance, interruption, cessation or loss of business or other occurrence, including, without limitation, such as are caused directly or indirectly by any Unavoidable Delays. 6.6. Without limiting Section 6.2(a) hereof: (a) Tenant agrees that all its activities on the Demised Premises during the Term will be conducted in compliance with Environmental Laws. Except for Landlord's obligations as set forth in Section 11.3, Tenant shall be responsible for obtaining all permits or licenses or approvals under Environmental Laws necessary for Tenant's operation of its business on the Demised Premises and shall make all notifications and registrations required by any applicable Environmental Laws. Tenant shall at all times comply with the terms and conditions of all such permits, licenses, approvals, notifications and registrations and with any other applicable Environmental Laws. 11 (b) Tenant shall not cause or permit any Hazardous Materials to be brought upon, kept or used in or about the Demised Premises, or transported to or from the Demised Premises, in any manner that violates any Environmental Laws. Tenant shall not cause or permit the release of any Hazardous Materials by Tenant or its agents, contractors, employees or invitees into any environmental media such as air, water or land in any manner that violates any Environmental Laws. If such described release shall occur, Tenant shall (i) clean up or otherwise remedy such release and any associated Contamination to the extent required by, and take any and all other actions required under, applicable Environmental Laws, and (ii) notify and keep Landlord reasonably informed of such release and response. (c) Tenant shall under no circumstances whatsoever (i) cause or permit any activity on the Demised Premises which would cause the Demised Premises to become subject to regulation as a hazardous waste treatment, storage or disposal facility under RCRA or the regulations promulgated thereunder, or (ii) discharge Hazardous Materials into the storm sewer system serving the Demised Premises in any manner that violates any Environmental Laws. (d) Tenant shall be responsible for all fines, suits, procedures, claims, actions and costs, including, without limitation, attorneys' fees, of any kind arising out of or in any way connected with any spills or discharges of Hazardous Materials at the Demised Premises which occur during the Term unless caused by Landlord, its agents, servants, or employees; and for all fines, suits, procedures, claims and actions of any kind arising out of Tenant's failure to provide all information, make all submissions, and take all actions required by the NJDEP. Tenant shall have no responsibility for the failure of Landlord to provide any information, make any submissions, or take any actions in accordance with Landlord's obligations as set forth in Section 11.3. (e) Tenant shall provide Landlord with reasonable advance notice of any meetings with, or inspections conducted by, the NJDEP in each instance in connection with ISRA, and Landlord's representatives shall have the right to attend any such meeting or inspection. 6.7.(a) At least ninety (90) days prior to the expiration or earlier termination of this Lease, Tenant agrees to seek a determination from the New Jersey Department of Environmental Protection ("NJDEP") in the form of a Letter of Non-Applicability ("LNA"), that the New Jersey Industrial Site Recovery Act, N.J.S.A. 13:1K-6 et seq. or any successor Environmental Law ("ISRA"), is inapplicable to the Tenant's cessation of operations and termination of this Lease. Tenant represents, warrants, and covenants that any information contained in any application for an LNA submitted pursuant to this subsection will be true and complete. Tenant represents that the Standard Industrial Classification (SIC) number, as designated in the Standard Industrial Classification Manual prepared by the Office of Management and Budget in the Executive Office of the President of the United States, applicable to Tenant's operations does not subject this transaction to the requirements of ISRA. Landlord shall cooperate in all reasonable aspects with Tenant in obtaining any required governmental action in connection with ISRA, including, without limitation, supplying all information reasonably requested by Tenant, and executing any applications, easements, or other documents Tenant reasonably believes necessary or desirable and which do not increase in any material fashion Landlord's obligations under this Lease. In the event the LNA is granted, Tenant shall promptly provide Landlord with a copy thereof. 12 (b) In the event that an LNA is denied by NJDEP, notice of such denial shall be delivered promptly to Landlord. Tenant shall satisfy its obligations under ISRA prior to the Expiration Date or earlier termination of this Lease: (i) by securing an approval of the Tenant's Negative Declaration; or (ii) by securing an approval of the Tenant's Remedial Action Workplan, completing the implementation of such Plan, and obtaining from NJDEP a "No Further Action" letter. Tenant shall bear sole responsibility for any investigation and cleanup costs, fees, penalties, or damages associated with ISRA compliance. In the event that Tenant is unable to complete its ISRA compliance obligations by the Expiration Date or earlier termination of this Lease, Landlord shall continue to provide Tenant with reasonable access to the Demised Premises, provided that any work undertaken by Tenant shall be performed in such a manner as to minimize interference with Landlord's or any other tenant's use of the Demised Premises. However, Landlord reserves its rights to deem Tenant a holdover tenant in the event that Tenant's ISRA compliance unreasonably restricts Landlord's or any other tenant's use of the Demised Premises. Notwithstanding the foregoing, Tenant is not responsible for any contamination which pre-exists the Approvals Date, including, without limitation, any contamination discovered in any test performed by Tenant pursuant to Section 11.4 unless Tenant has caused such contamination. (c) Tenant shall provide Landlord with copies of all correspondence, documents and reports, including, without limitation, sampling results submitted to or received from any governmental agency or third party in connection with Tenant's compliance with ISRA. (d) Notwithstanding any of the foregoing to the contrary, in no event shall Tenant be responsible for any compliance or any costs or expenses of any required cleanup or clean-up plan where the spills or discharges which create the need for such compliance, cleanup or plan occurred prior to the Approvals Date unless such spill or discharge is caused by Tenant's acts or omissions or those of its contractors, agents or employees. (e) Tenant consents to Landlord taking any and all actions on or under the Demised Premises that, in Landlord's reasonable judgment, are necessary to investigate, remediate, or otherwise address environmental conditions at the Demised Premises in satisfaction of Landlord's obligations under this Lease provided, however, Landlord shall take such actions in such manner so as to interfere with Tenant's use and enjoyment of the Demised Premises only to the minimum extent reasonably practicable, and shall promptly restore any damage to the Demised Premises caused by Landlord. (f) The provisions of this Article 6 shall survive the expiration or earlier termination of this Lease. ARTICLE 7 - UTILITIES AND SERVICES 7.1. Tenant shall arrange for, and promptly pay when due all amounts and charges for, the providing of all utilities and services required, used, rendered or supplied in or to the Demised Premises accruing after the Rent Commencement Date and thereafter throughout the Term. Except as provided in Article 11, Landlord shall have no obligation to provide for the same. 13 ARTICLE 8 - REPAIR AND MAINTENANCE 8.1. (a) (i) Tenant shall take good care of the Demised Premises, make all repairs thereto, interior and exterior, structural and non-structural, ordinary and extraordinary, foreseen and unforeseen, and shall maintain and keep the Demised Premises in good order, repair and condition, ordinary wear and tear, casualty and condemnation excepted. Tenant shall perform the obligation set forth in the first sentence of this Section 8.1 during the first twenty (20) years of the Term following the Rent Commencement Date at its sole cost and expense. If, after the twentieth anniversary of the Rent Commencement Date, during the balance of the Term, as extended, compliance with the first sentence of this Section 8.1 requires a Capital Expenditure, Landlord and Tenant shall be responsible for the cost in accordance with Section 8.1(a)(ii). Upon becoming aware of such a requirement, Tenant shall deliver a notice to Landlord which notice shall comply with the last sentence of this Section 8.1(a)(i) and which shall include: (A) notice of such requirement; (B) a plan of action including, without limitation, a description of any work to be undertaken; and (C) a budget which may include reasonable supervision fees, and an allocation for overhead, but not profit. Landlord shall have thirty (30) days from delivery of the notice to provide Tenant with whatever comments Landlord might have concerning the information delivered. Landlord and Tenant shall work in good faith to agree on a plan of action. However, if Landlord and Tenant cannot so agree within sixty (60) days of Tenant's original delivery of the described notice, or if Landlord and Tenant cannot agree as to the necessity for a Capital Expenditure, or the proper division of the cost of any Capital Expenditure, either party may submit the issue to arbitration pursuant to Article 30 hereof for resolution. If Landlord does not respond to Tenant's notice within thirty (30) days of delivery of same Landlord will be deemed to have approved performance by Tenant of the suggested plan of action. Tenant's notice shall specifically set forth, in bold type, that Landlord's failure to respond within thirty (30) days shall be deemed approval of the suggested plan of action. (ii) (A) Tenant shall perform the approved (or deemed approved) plan of action for Landlord's account and at Landlord's sole cost and expense. The approved (or deemed approved) budget (so long as prepared in good faith) shall not represent a ceiling on the costs to be incurred by Landlord in Tenant's performance of the plan of action, but Tenant shall act in good faith to perform in accordance with such budget and shall keep Landlord informed of any material variations therefrom. The plan of action shall be implemented in the manner set forth in this Article 8 in a good and workmanlike manner. (B) Tenant shall submit invoices for payment or reimbursement to Landlord from time to time, but no more frequently than monthly, for materials on-site, work in place, "soft" costs incurred, and other out of pocket costs or expenses reasonably incurred in connection with such work and in accordance with the plan of action. Invoices shall be accompanied by reasonable evidence of third party expenditures, e.g., third party invoices. Landlord shall pay Tenant's invoices within thirty (30) days of receipt. (C) Upon completion of the required plan of action, the total out-of-pocket cost to Landlord of implementing same may be amortized over the useful life of the work completed, but in no event more than ten (10) years, and the amortized portion of such cost allocable to the remaining initial Term hereof, without extension (if the relevant work becomes required during the initial Term), or the remaining Extension Term (if the relevant work becomes 14 required during the Extension Term ), may be charged to, and shall be payable to Landlord by Tenant, within thirty (30) days of Landlord billing Tenant for same. Landlord and Tenant agree that if a Capital Expenditure is made in the initial Term, and the useful life of the work extends into the Extension Term (if any) Tenant shall not be obligated to pay for the portion of the cost thereof which is allocable to the Extension Term, but that the value of such work shall be taken into account, to the extent appropriate, in determining the Fixed Annual Rent for the Extension Term pursuant to Section 2.3 hereof. (iii) Landlord's obligations as set forth in this Section 8.1 shall not relieve Tenant of Tenant's obligation to maintain the Demised Premises in accordance with the first sentence of Section 8.1(a)(i). 8.2. (a) Subject to Section 8.2(b), on at least three (3) business days prior notice to Tenant, and accompanied at all times by a representative of Tenant, which representative Tenant shall make available to Landlord, Tenant shall permit any authorized representative of Landlord and any Fee Mortgagee to enter the Demised Premises at all reasonable times for the purpose of inspecting all or any part thereof and, to the extent expressly provided for under this Section 8.2, making any repairs, replacements and restorations to the Demised Premises or any part thereof. If Tenant shall fail to perform in any material fashion its obligations as set forth in Section 6.2 or 8.1 hereof, and such failure continues for thirty (30) days after notice from Landlord (or, if such failure cannot reasonably be corrected in thirty (30) days, if Tenant does not commence to correct such failure within thirty (30) days of notice from Landlord and thereafter fails to prosecute such correction to completion with due diligence and in good faith), Landlord and any party designated by Landlord shall have the right, but not the obligation, to enter the Demised Premises and perform such work. Tenant shall reimburse Landlord upon demand as Additional Rent for any cost and expense incurred by Landlord or such designee therefor, including, without limitation, all incidental costs and expenses (including, without limitation, reasonable attorneys' fees) in connection therewith. During the progress of any work Landlord is required or permitted to do under the provisions of this Lease, Landlord or its designee may bring, keep and store on the Demised Premises all necessary materials, supplies, equipment and tools, but shall be obligated to comply with Tenant's reasonable rules as to the storage of same and the hours during which work is conducted (which Tenant may insist are outside normal day time business hours), so as to minimize, to the extent reasonably practicable, the impact of such work on Tenant's operations. Subject to compliance with the prior sentence, Landlord and its designee shall not in any event be liable for any inconvenience, annoyance, interruption, cessation or loss of business or other occurrence as pertains to Tenant or any other occupant of the Demised Premises or any part thereof on account of entering the Demised Premises, performing such work, or bringing, keeping or storing any materials, supplies, equipment or tools into, on or through the Demised Premises, and the obligations of Tenant under this Lease shall not thereby be affected in any manner whatsoever. (b) Notwithstanding Section 8.2(a), if a representative of a governmental agency is demanding that due to an emergency Landlord grant such governmental agency access to the Demised Premises, and contacting Tenant is not reasonable in the circumstances, Landlord may grant such governmental agency access to the Demised Premises to address the emergency. 15 ARTICLE 9 - MECHANICS' AND OTHER LIENS 9.1. Tenant shall not suffer or permit any mechanics' or other liens (except for leasehold mortgage liens permitted pursuant to Article 32 and such as are caused by any acts or omissions of Landlord) to be recorded or filed against the Demised Premises or any part thereof or against the interests therein of Landlord or Tenant. If any such lien (except for leasehold mortgage liens permitted pursuant to Article 32 and such as are caused by any acts or omissions of Landlord) shall at any time be recorded or filed against the Demised Premises or any such interest therein, and the party recording such lien has commenced any formal legal process to foreclose such lien, Tenant shall cause the same to be discharged of record within thirty (30) days of notice of such commencement by either payment, deposit or bond. If Tenant shall fail to cause any such lien to be discharged of record within such period, Landlord shall have the right (in addition to all other remedies), but not the obligation, to cause the discharge of such lien of record either by paying the amount claimed to be due, by deposit in court or by bond. Tenant shall reimburse Landlord upon demand as Additional Rent for any amount paid or deposited by Landlord therefor, including, without limitation, all incidental costs and expenses (including, without limitation, reasonable attorneys' fees) in connection therewith, together with interest on all such amounts at the Late Payment Rate from the date of payment or deposit by Landlord. ARTICLE 10 - ALTERATIONS 10.1. (a) Tenant, at Tenant's sole cost and expense, may make from time to time, without Landlord's consent, any alteration, addition, change, replacement, installation, improvement, deletion, or removal (herein collectively called "Alteration"), in or to the Demised Premises, provided, however, in each case Tenant: (i) shall submit to Landlord copies of marked shop drawings or the final as-built detailed plans and specifications of such Alteration prepared, if required by Legal Requirement, by a registered architect or professional engineer; (ii) shall not demolish the Building, unless a substitute building with a footprint of at least 250,000 square feet is constructed by Tenant, at Tenant's sole cost and expense, in replacement of the demolished Building; and (iii) shall perform any Alteration in compliance with all Legal Requirements and Insurance Requirements. (b) If any structural Alteration: (i) changes the footprint of the Building as initially constructed in accordance with this Lease, or (ii) reduces the volume of the Building as initially constructed in accordance with this Lease, or (iii) changes the material used on the facade of the Building as initially constructed in accordance with this Lease, and in any such instance, (i), (ii), or (iii), reduces the value of the Building at the time of the making of such Alteration, or if any Alteration modifies the base building systems such that the modified system would not be reasonably sufficient to provide electrical, plumbing, sprinklers, and HVAC services to a Building with between 30,821 and 37,671 square feet of office space and between 206,580 and 252,486 square feet of warehouse/distribution space (Landlord acknowledging it is not necessary to air condition warehouse/distribution space), then in each instance, Tenant nonetheless may make such Alteration, but, prior to the expiration or earlier termination of this Lease, must restore the Demised Premises to the condition which existed immediately prior to the making of such Alteration, which restoration obligation, once fulfilled by Tenant, shall be subject to reasonable wear and tear and Articles 13 and 14 hereof. 16 (c) Either Landlord or Tenant may request the conclusion of the other as to whether any proposed or existing Alteration is of the nature that would require Tenant, absent Landlord consent, to restore the Demised Premises in accordance with Section 10.1(b). Landlord shall provide such conclusion within thirty (30) days of being provided the information reasonably required to make such a conclusion, e.g., plans or specifications, or both, depending on the relevant Alteration. If Landlord fails to respond timely, Landlord will be deemed to have concluded the Alteration does not require Tenant to restore the Demised Premises in accordance with Section 10.1(b). Tenant shall provide such conclusion within thirty (30) days of Landlord's request. If Tenant fails to respond timely, Tenant will be deemed to have concluded the Alteration does require Tenant to restore the Demised Premises in accordance with Section 10.1(b). A party's conclusion shall not bind the other party hereto, but shall estop the party making (or being deemed to make) such conclusion. Any dispute as to whether any existing or proposed Alteration requires Tenant to restore the Demised Premises in accordance with Section 10.1(b) shall be determined by arbitration pursuant to Article 30. Either Landlord or Tenant may insist on proceeding to make this determination utilizing any expedited procedures then being utilized by the American Arbitration Association. (d) Except as set forth in Section 10.1(b), Tenant shall not have any obligation to remove or restore any Alteration. (e) No Alteration will cause Fixed Annual Rent to change, provided, however, any Alteration made during the initial Term, without extension, shall be taken into account, to the extent appropriate, in determining the Fixed Annual Rent for the Extension Term pursuant to Section 2.3 hereof. Tenant shall be solely responsible for any change in Additional Rent caused by the making of any Alteration. (f) To the extent that Landlord, pursuant to Article 8 (but not Article 6), incurs the cost of a Capital Expenditure for any Improvement which Tenant, in the process of making any Alteration, removes, and to the extent that the removal of the improvement for which Landlord has made a Capital Expenditure and the making of the Alteration reduces the value of the Building, and Tenant does not have a restoration obligation pursuant to Section 10.1(b) and has not received Landlord's consent to the relevant Alteration ( this Section 10.1(f) in no way implying any such Landlord consent is needed), Tenant shall reimburse to Landlord the present value of the net loss in value to Landlord's reversionary interest in the Demised Premises, if any, Landlord suffers by the making of the Alteration and the removal of the improvement for which Landlord has made a Capital Expenditure. 10.2 (a) Whether under the provisions of this Lease or otherwise, neither Tenant, nor any subtenant, nor any agent, employee, representative, contractor, or subcontractor of either Tenant or any subtenant, shall have any power or authority to do any act or thing or to make any contract or agreement which will bind Landlord or which may create or be the foundation for any mechanic's lien or other lien or claim upon or against Landlord's interest in the Demised Premises, and Landlord shall have no responsibility to Tenant or to any subtenant, contractor, subcontractor, supplier, materialman, workman or other person, firm or corporation who shall engage in or participate in any construction of any Alteration unless Landlord shall expressly undertake such obligation by an agreement in writing signed by Landlord and made between 17 Landlord and Tenant, or such subtenant, contractor, subcontractor, supplier, materialman, workman, or other person, firm or corporation. (b) Notice is hereby given that Landlord shall not be liable for any labor or materials furnished or to be furnished to Tenant upon credit, and that no mechanic's or other lien for any such labor or materials shall attach to or affect the estate or interest of Landlord in and to the Demised Premises. ARTICLE 11 - SITE PLAN APPLICATION/RIGHT TO TERMINATE/LANDLORD'S WORK/TENANTS WORK 11.1 (a) Landlord acknowledges that in order to construct the Initial Improvements without seeking a variance and to allow vehicular ingress and egress from and to Parsippany Road and vehicular ingress from Route 10, it is necessary to obtain a zoning change amendment ("Zoning Amendment") to the Township of Hanover (the "Township") ordinance, and approvals ("Access Approvals") from the New Jersey State Department of Transportation ("DOT"), the County of Morris and any other relevant governmental agencies for the described ingress and egress. The Zoning Amendment has been obtained, but is still subject to appeal. The DOT Access Approval has been obtained. Tenant is working to obtain the Morris County Access Approval. If at any time prior to the Approvals Date, the Zoning Amendment, having been adopted, is thereafter repealed, or other legislation is adopted which would necessitate the Tenant obtain variances to construct the Initial Improvements as currently contemplated, other than the currently contemplated sign variances, Tenant may elect to seek the variances it requires to develop the Initial Improvements as currently contemplated. If Tenant so elects, Tenant shall seek to obtain the required variances with due diligence and in good faith, provided, however, that at any time after the Township's repeal of the Zoning Amendment, or the adoption of other legislation which would necessitate the aforesaid variances, Tenant may cease such efforts and terminate this Lease. Landlord may also terminate this Lease, at any time after the Township's repeal of the Zoning Amendment or the adoption of other legislation which would necessitate the aforesaid variances, unless upon receipt of a termination notice from Landlord Tenant affirms to Landlord that Tenant is attempting, with due diligence and in good faith, to obtain the required variances. (b) If by June 30, 2001: (i) the Zoning Amendment is repealed, or (ii) any variances requested by Tenant are not received, other than the currently contemplated sign variances, or (iii) the Access Approvals are not received, each of (i), (ii), or (iii) beyond any right of appeal, either Landlord or Tenant, at any time prior to the adoption of the Zoning Amendment, or the receipt of the requested variances and the receipt of the Access Approvals, and the expiration of the periods in which any appeals of any may be brought, may terminate this Lease by notice to the other. In the event this Lease is terminated pursuant to this Section 11.1 same shall be without force or effect except for the refund of Rent pursuant to Section 3.2 and the provisions hereof which expressly survive termination of this Lease, and neither Landlord nor Tenant shall have any rights against the other except pursuant to such surviving provisions. If Landlord or Tenant terminates this Lease pursuant to this Section 11.1(b) after the Approvals Date has occurred such termination shall be deemed to have occurred pursuant to Section 11.2(b)(iv) for all purposes of this Lease. 18 11.2 (a) Tenant, with due diligence and in good faith, at Tenant's sole cost and expense, shall attempt to obtain the Approvals for the construction on the Land of a Building ("Building") and site improvements substantially as shown on Exhibit B annexed hereto and made a part hereof (as Tenant may change same from time-to-time in the manner contemplated in this Section 11.2(a) in connection with working to obtain the Approvals, collectively, the "Initial Improvements"). Tenant's obligations shall include, without limitation, the preparation and submission of a major site plan and minor subdivision application ("Application") with appropriate supporting drawings and documentation to the Planning Board of Hanover Township ("Planning Board") and, in the event the Application is approved by the Planning Board, and Tenant does not exercise its rights pursuant to Section 11.2(b)(iii), the subsequent execution and delivery to the Township of a Developer's Agreement in form and substance reasonably acceptable to Tenant. The Application, in the first instance, shall conform to the Zoning Amendment so as to avoid the need for variances (other than the currently contemplated sign variances). Landlord acknowledges that in working to obtain the Approvals Tenant may determine that a modification to the plans as shown on Exhibit B and/or the Application will facilitate the likelihood of obtaining the Approvals. Accordingly, Tenant shall have the right to modify the plans as shown on Exhibit B and/or the Application from time to time as Tenant, in its good faith judgment, deems appropriate in connection with Tenant working to obtain the Approvals. Landlord shall cooperate in all reasonable means with Tenant in obtaining the Approvals including, without limitation, supplying all information in Landlord's possession reasonably requested by Tenant, executing any applications or other documents Tenant reasonably believes necessary or desirable and which do not increase in other than a de minimus manner Landlord's obligations under this Lease, and attending meetings at Tenant's request to provide testimony in support of the Application, and shall not knowingly taking any actions which would negatively impact the likelihood that Tenant will receive the Approvals. Landlord is free to attend any meetings attended by Tenant with representatives of any governmental body or agency in connection with obtaining any required Approval, for the purpose of Landlord observing the meeting. However, Tenant shall conduct the meeting, and need not solicit, nor follow, Landlord's advice. Tenant has no obligation to inform Landlord of meetings which are to occur, provided, however Tenant, upon request from Landlord, shall inform Landlord of any meetings which, at the time of the response, are then scheduled to occur. (b) (i) If, despite complying with Section 11.2(a), Tenant fails to cause the Approvals Date to occur by June 30, 2001, Tenant, at any time until the Approvals Date has occurred, shall have the right to terminate this Lease by notice to Landlord and, until Tenant does so, shall continue to comply with Section 11.2(a) to attempt to cause the Approvals Date to occur. (ii) If Tenant fails to cause the Approvals Date to occur by December 31, 2001, Landlord, at any time subsequent to December 31, 2001 and prior to Tenant causing the Approvals Date to occur, and subject to the terms of this paragraph, may terminate this Lease. If Landlord delivers notice to Tenant terminating this Lease pursuant to this subparagraph, such notice shall contain a date of termination, which shall be at least ten (10) days after delivery of the notice. Provided no Event of Default shall have occurred and be continuing, Tenant, subject to it having complied with its Section 11.1 and 11.2(a) obligations, prior to the effective date of the termination, may extend, until the six (6) month anniversary of the specified termination date, the period of time in which Tenant may seek to cause the Approvals Date to occur, by 19 delivering notice of such extension, together with a payment in the amount of $482,500, to Landlord prior to the specified termination date. Such payment shall be non-refundable, and deemed earned by Landlord in full upon delivery thereof. If, by such six (6) month anniversary, Tenant has still not caused the Approvals Date to occur, and provided no Event of Default shall have occurred and be continuing, Tenant, subject to it having continued to comply with its Section 11.1 and 11.2(a) obligations, may extend until the one (1) year anniversary of the specified termination date the period of time in which Tenant may seek to cause the Approvals Date to occur, by delivering notice of such further extension, together with a second $482,500 payment, to Landlord prior to the end of the first six (6) month extension. This second payment also shall be non-refundable, and deemed earned by Landlord in full upon delivery thereof. If, by such one (1) year anniversary, Tenant has still not caused the Approvals Date to occur, this Lease shall terminate and be of no force or effect except for those provisions which expressly survive such termination. However, if, during either effective extension, the Approvals Date does occur, Landlord's termination notice shall be void, and this Lease shall continue in full force and effect pursuant to its terms. If Tenant has extended the time in which it can attempt to cause the Approvals Date to occur pursuant to this Section 11.2(b)(ii), the Rent Commencement Date shall be deemed to be the Approvals Date, and Tenant shall receive a credit against the first amounts of Fixed Annual Rent due hereunder (after crediting Tenant for the first month's rent paid on the date hereof) equal to the pro-rata portion of the relevant $482,500 payment which is allocable to the period of time subsequent to the occurrence of the Rent Commencement Date ( such payment to be deemed earned evenly over the six month extension period to which it relates). (iii) (A) If the Application is approved by the Planning Board, but subject to any "Unacceptable Condition" ( as defined in this subparagraph), Tenant, within ten (10) days of receipt of the Planning Board resolution memorializing the approval of the Application, may terminate this Lease. Further, although Tenant has the obligation to utilize diligent efforts to negotiate a reasonably acceptable Developer's Agreement, it has no obligation to execute or deliver a Developer's Agreement which is not reasonable. An "Unacceptable Condition" is any condition or conditions which limit Tenant's ability to develop the Improvements in all material respects as shown on the final amended Application submitted by Tenant to the Planning Board, or limit Tenant's ability to use and enjoy the Demised Premises, when developed, materially in the manner contemplated by Tenant, or, subject to the balance of this Section 11.2(b)(iii), which necessitate the construction of off-site or off-tract improvements or off-site or off-tract contributions which, in the aggregate, are reasonably projected by Tenant to result in "Off-Site Costs" (as defined in Section 11.3(c)) in excess of either: (y) if the "Landlord's Tract" (as defined in Section 11.3(c)) is delivered to the Township in connection with obtaining the Approvals, $1,575,000, or (z) if the Landlord's Tract is not delivered to the Township in connection with obtaining the Approvals, $1,000,000. (B) Landlord also shall have the right, subject to the balance of this Section 11.2(b)(iii), to terminate this Lease within ten (10) days of receipt of the Planning Board resolution memorializing the approval of the Application, if the approval of the Application is subject to any condition or conditions wh