Exhibit 10.32
AGREEMENT OF LEASE
between
CAMPUS INVESTORS D BUILDING, L.P.
and
MEDSTAFF, INC.
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TABLE OF CONTENTS
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1. BASIC
TERMS; OTHER DEFINED TERMS;
EXHIBITS..................................................................1
1.1.
Basic
Terms...........................................................................................1
1.2.
Other Defined
Terms...................................................................................3
1.3.
Exhibits..............................................................................................3
2. DEMISE;
TERM; FREE RENT PERIOD; ADDITION
OPTION.............................................................4
2.1.
Demise................................................................................................4
2.2.
Term..................................................................................................4
2.3.
Free
Base Rent
Period.................................................................................4
2.4.
Workletter............................................................................................5
3.
USE.........................................................................................................5
3.1.
Use...................................................................................................5
4.
RENT........................................................................................................5
4.1.
Base
Rent.............................................................................................5
4.2. Additional Rent;
Rent In
General......................................................................5
4.3.
Payments of Less Than Full Amount
Due.................................................................6
5.
[INTENTIONALLY
OMITTED].....................................................................................6
6.
TAXES.......................................................................................................6
6.1.
The
Tax
Adjustment....................................................................................6
6.2.
Monthly Tax
Payments..................................................................................6
6.3.
Tax
Statement.........................................................................................7
6.4.
Continuing Obligation to Make Payments on Account of Next Tax
Year....................................7
6.5.
Landlord's Right to Waive Requirement for Monthly Tax
Payments........................................7
6.6.
Certain
Reassessments.................................................................................7
7.
OPERATING
EXPENSES..........................................................................................7
7.1.
The
Operating Expense
Adjustment......................................................................7
7.2.
Monthly Expense
Payments..............................................................................7
7.3.
Operating Expense
Statement...........................................................................8
7.4.
Inspection
Right......................................................................................8
8.
MAINTENANCE AND REPAIR OF THE
PREMISES......................................................................9
9.
OPERATION OF THE PREMISES AND THE PROPERTY; COMMON FACILITIES;
PARKING......................................9
9.1.
General
Restrictions..................................................................................9
9.2.
Rules and
Regulations................................................................................10
9.3.
Declaration and
REA..................................................................................11
9.4.
Americans With Disabilities
Act......................................................................11
9.5.
Common
Facilities....................................................................................11
9.6.
Parking..............................................................................................11
10. LANDLORD'S
RIGHT OF ACCESS; LANDLORD'S RIGHT TO
CURE.......................................................12
10.1.
Right to
Enter
Premises..............................................................................12
10.2.
Right to
Install
Equipment...........................................................................12
10.3.
Landlord's
Right To
Cure.............................................................................12
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11. LANDLORD'S
SERVICES........................................................................................13
11.1.
HVAC.................................................................................................13
11.2.
Electric.............................................................................................13
11.3.
Water................................................................................................14
11.4.
Elevator
Service.....................................................................................14
11.5.
Janitorial
Service to the
Premises...................................................................14
11.6.
Cleaning,
Maintenance and Repair by
Landlord.........................................................14
11.7.
Costs of
Performance.................................................................................16
11.8.
Interruption of
Services.............................................................................16
12. COVENANT OF
QUIET
ENJOYMENT................................................................................17
13. ALTERATIONS;
SIGNS.........................................................................................17
13.1.
General
Requirements.................................................................................17
13.2.
Removal of
Alterations...............................................................................17
13.3.
Signs................................................................................................18
14.
INDEMNIFICATION;
INSURANCE.................................................................................18
14.1.
Indemnification......................................................................................18
14.2.
Tenant's
Insurance...................................................................................19
14.3.
Policy
Requirements..................................................................................20
14.4.
Delivery
of Certificates; Failure to Maintain
Insurance..............................................20
14.5.
Waiver of
Subrogation................................................................................21
14.6.
Self
Insurance.......................................................................................21
15. DAMAGE OR
DESTRUCTION......................................................................................21
15.1.
Duty to Restore;
Limitations.........................................................................21
15.2.
Landlord's
Right to
Terminate........................................................................22
15.3.
Tenant's
Right to
Terminate..........................................................................23
15.4.
Rent
Abatement.......................................................................................23
16.
CONDEMNATION...............................................................................................23
16.1.
Total
Taking.........................................................................................23
16.2.
Partial
Taking.......................................................................................23
16.3.
Landlord's
Right To
Terminate........................................................................24
16.4.
Award................................................................................................24
17.
[INTENTIONALLY
OMITTED]....................................................................................24
18. SUBLETTING
AND
ASSIGNMENT..................................................................................24
18.1.
Notice of
Intent; Landlord's Right to
Terminate......................................................24
18.2.
Consent
Required.....................................................................................25
18.3.
Profit...............................................................................................25
18.4.
Joint and
Several
Liability..........................................................................26
18.5.
No Waiver
of Future
Compliance.......................................................................26
18.6.
Transfer
of Control; Transfers By Legal Process or Operation of
Law..................................26
18.7.
Sublease
or Assignment to Permitted
Transferees......................................................26
19. MORTGAGEE
PROVISIONS; ESTOPPEL
CERTIFICATE.................................................................27
19.1.
Subordination........................................................................................27
19.2.
Attornment...........................................................................................27
19.3.
Further
Assurances...................................................................................28
19.4.
Modifications........................................................................................28
19.5.
Right to
Cure........................................................................................28
19.6.
Limitations on Liability of
Mortgagees/Overlessors...................................................28
19.7.
Estoppel
Certificate.................................................................................29
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20.
ENVIRONMENTAL
MATTERS......................................................................................30
20.1.
Covenants............................................................................................30
20.2.
Indemnification; Breach of
Covenants.................................................................31
21. SURRENDER;
UNDETERMINED
CHARGES............................................................................32
21.1.
Condition
Upon
Surrender.............................................................................32
21.2.
Personal
Property....................................................................................32
21.3.
Undetermined
Charges.................................................................................32
22. RETENTION OF
PREMISES AFTER TERMINATION OF
TERM............................................................33
22.1.
Holdover.............................................................................................33
22.2.
Right To
Treat Tenant as
Trespasser..................................................................33
22.3.
Additional
Remedies; Remedies
Cumulative.............................................................33
23. EVENTS OF
DEFAULT..........................................................................................34
23.1.
Defined..............................................................................................34
23.2.
[Intentionally
Omitted]..............................................................................35
23.3.
Landlord
Default.....................................................................................35
24.
REMEDIES...................................................................................................36
24.1.
Termination of
Lease.................................................................................36
24.2.
Reletting;
Right to Collect Rent from
Subtenants.....................................................36
24.3.
Acceleration of
Rent.................................................................................36
24.4.
Removal of
Contents by
Landlord......................................................................37
24.5.
[Intentionally
Omitted]..............................................................................37
24.6.
CONFESSION
OF
JUDGMENT...............................................................................37
24.7.
[Intentionally
Omitted]..............................................................................38
25. PROVISIONS
CONCERNING
REMEDIES.............................................................................38
25.1.
Rights of
Landlord's Successors and
Assigns..........................................................38
25.2.
Waiver
of Landlord and Tenant
Act
Notices...........................................................38
25.3.
Survival
of Tenant's
Obligations.....................................................................38
25.4.
Injunction...........................................................................................38
25.5.
Waiver of
Redemption.................................................................................39
25.6.
Rights
Cumulative....................................................................................39
25.7.
Expenses.............................................................................................39
25.8.
Waivers..............................................................................................39
25.9.
Waiver of
Jury
Trial.................................................................................39
26. OPTION TO
RENEW............................................................................................39
26.1.
Grant of
Renewal
Option..............................................................................39
26.2.
Conditions...........................................................................................40
26.3.
Terms................................................................................................40
26.4.
Determination of Market
Rent.........................................................................41
27. AAS
OPTION.................................................................................................42
27.1.
Overview.............................................................................................42
27.2.
Grant of
AAS Option; Exercise of AAS
Option..........................................................42
27.3.
Conditions...........................................................................................42
27.4.
Terms of
Lease of the Included
Space.................................................................43
27.5.
AAS Option
Not Exhausted By One
Exercise.............................................................44
28.
NOTICES....................................................................................................45
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29.
MISCELLANEOUS..............................................................................................45
29.1.
Brokers..............................................................................................45
29.2.
Successors
and
Assigns...............................................................................45
29.3.
Limitation
of Landlord's
Liability...................................................................45
29.4.
Time of
the
Essence..................................................................................46
29.5.
Severability.........................................................................................46
29.6.
Entire
Agreement;
Modifications......................................................................46
29.7.
Interpretation of
Lease..............................................................................46
29.8.
Governing
Law........................................................................................46
29.9.
Powers of
Attorney...................................................................................47
29.10.
Joint and
Several
Liability.........................................................................47
29.11.
Delivery
For
Examination............................................................................47
29.12.
Corporate
and Partnership
Tenants...................................................................47
29.13.
Financial
Statements................................................................................47
29.14.
Third Party
Beneficiaries...........................................................................48
29.15.
OFAC................................................................................................48
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<PAGE>
AGREEMENT OF LEASE
THIS AGREEMENT OF LEASE (the "Lease") is made as of February 15,
2006,
by and between CAMPUS INVESTORS D BUILDING, L.P., a Delaware
limited
partnership, (the "Landlord"), and MEDSTAFF, INC., a Delaware
corporation (the
"Tenant").
W I T N E S S E T H:
For and in consideration of the mutual covenants and agreements
set
forth in this Lease, and intending to be legally bound, Landlord
and Tenant
agree as follows:
1. BASIC TERMS; OTHER DEFINED TERMS; EXHIBITS.
1.1. Basic Terms.
This Section 1.1 contains definitions of certain basic terms
used in this Lease. When used in this Lease, these terms shall have
the
meanings, or be ascribed the amounts, set forth below:
1.1.1. Building. The two story, approximately 240,000 rentable
square foot office building known as D Building located in Newtown
Square,
Delaware County, Pennsylvania, on Convertible Real Estate Parcel D
of Kelly
Preserve ("Kelly Preserve"), which is Unit 1 of Ellis Preserve
("Ellis
Preserve"), both planned communities pursuant to the provisions of
the
Pennsylvania Uniform Planned Community Act, 68 Pa. C.S. ss.5101,
et. seq., as
amended.
1.1.2. Property. The parcel of land on which the Building is
located, being the Kelly Preserve, as more particularly described
in Exhibit
1.1.2.
1.1.3. Premises. The space, containing approximately 31,959
rentable square feet, located on the second floor of the Building,
as more
particularly shown on the Plan, such measurement to be subject to
final
determination by Landlord's architect in accordance with 1996
ANSI/BOMA Z65.1
standards (provided that the common area shall be deemed to be not
more than
eighteen percent (18%) of the building area).
1.1.4. Base Rent.
Lease Months
RSF
Annual
Monthly
------------ ---
------
-------
1 - 5
$0.00
$0.00
$0.00
6 - 17
$23.75
$759,026.25
$63,252.19
18 - 29
$24.25
$775,005.75
$64,583.81
30 - 41
$24.75
$790,985.25
$65,915.44
42 - 53
$25.25
$806,964.75
$67,247.06
54 - 65
$25.75
$822,944.25
$68,578.69
66 - 77
$26.25
$838,923.75
$69,910.31
78 - 89
$26.75
$854,903.25
$71,241.94
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The annual Base Rent per rentable square foot is as set forth in
the second
column of the above chart; however, the annual and monthly Base
Rents set forth
above are subject to adjustment, based upon the final determination
of the
rentable square footage of the Premises made by Landlord's
architect.
1.1.5. Tenant's Share. 13.32 %. This represents the percentage
equivalent of a fraction, the numerator of which is 31,959, and the
denominator
of which is 240,000 (which the parties agree is the rentable area
of the
Building). Tenant's Share is subject to adjustment, based upon the
final
determination of the rentable square footage of the Premises made
by Landlord's
architect.
1.1.6. Term. Seven (7) years, five (5) months, subject to
Section 2.2.
1.1.7. Security. A Lease Guaranty dated on the same date as
this Lease (the "Guaranty") by Cross Country Healthcare Inc. (the
"Guarantor")
in favor of Landlord.
1.1.8. Brokers. Grubb & Ellis and GPX Realty Partners.
1.1.9. Addresses for Notices.
If to Landlord:
Campus Investors D Building, L.P.
c/o BPG Management Company, L.P.
Suite 150
770 Township Line Road
Yardley, PA 19067
Facsimile No.: (267)
757-0549
With a required copy to:
BPG Properties, Ltd.
3000 Centre Square West
1500 Market Street
Philadelphia, PA
19102
Attention: General
Counsel
Facsimile No.: (215)
569-0329
2
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If to Tenant:
Prior to Commencement Date:
MedStaff, Inc.
297 South Newtown Street Road
Newtown Square, Pennsylvania
Attention: Tim Rodden,
COO
Facsimile No.: (610)
353-7850
From and After Commencement Date:
MedStaff, Inc.
3805 West Chester Pike
Newtown Square, PA
19073
Attention: Tim Rodden,
COO
Facsimile No.: [to be
provided by Tenant prior to
Commencement Date]
With a required copy to:
Cross Country Healthcare, Inc.
6551 Park of Commerce Blvd., N.W.
Boca Raton, FL 33487
Attention: General Counsel
Facsimile No.: (800)
565-9774
1.2. Other Defined Terms.
Exhibit 1.2 contains a list of all capitalized terms used in
this Lease, together with the definitions of such terms or
references to the
Sections in which such definitions may be found. All capitalized
terms used in
this Lease have the meanings set forth in Exhibit 1.2 or in the
Sections in
which the definitions of such terms appear.
1.3. Exhibits.
The following documents are attached as exhibits to and are a
part of this Lease:
Exhibit 1.1.2
Legal Description of Property
Exhibit 1.2
Definitions
Exhibit 2.1.1
Plan of the Premises
Exhibit 2.2.3
Commencement Date Agreement
Exhibit 2.4
Workletter
Exhibit 9.2.1
Rules and Regulations
Exhibit 9.6.1
Location of Parking Spaces
Exhibit 11.1.1
HVAC System
Exhibit
13.1.2
Standards for Work Performed by Tenant
Exhibit 27.1
Adjacent Space
3
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2. DEMISE; TERM; FREE RENT PERIOD; ADDITION OPTION.
2.1. Demise.
Landlord hereby demises and leases the Premises to Tenant and
Tenant hereby leases the Premises from Landlord, including
nonexclusive access
to all Common Facilities, subject to the rights of other tenants,
for the Term
and upon and subject to the terms and conditions of this Lease. The
Premises is
shown on the plan attached to this Lease as Exhibit 2.1.1 (the
"Plan"). The Plan
is attached for purposes of illustration only. The actual
dimensions of the
Premises may vary from those shown on the Plan.
2.2. Term.
2.2.1. The Term shall commence on the date (the "Commencement
Date") which is the earlier of (a) the date on which Tenant takes
possession of
the Premises, or (b) the date that the Tenant Improvements are
Substantially
Completed or would have been Substantially Completed but for Tenant
Delay. The
Rent Commencement Date shall occur on the date which is five (5)
calendar months
following the Commencement Date.
2.2.2. If the Commencement Date occurs on the first day of a
calendar month, the Term shall end seven (7) years and five (5)
months from the
Commencement Date, unless extended or sooner terminated as provided
in this
Lease. If the Commencement Date occurs on any day other than the
first day of a
calendar month, the Term shall end seven (7) years and five (5)
months from the
first day of the calendar month immediately following the
Commencement Date,
unless extended or sooner terminated as provided in this Lease. The
date upon
which the Term expires is referred to as the "Expiration Date."
2.2.3. After the Commencement Date has been determined,
Landlord and Tenant shall enter into an agreement, in the form
attached to this
Lease as Exhibit 2.2.3, confirming the Commencement Date, the Rent
Commencement
Date and the Expiration Date of the Term. In the event Tenant fails
to execute
and deliver such agreement within ten (10) days of written request
by Landlord,
Tenant does hereby make, constitute and appoint Landlord as
Tenant's
attorney-in-fact and agent in its name, place and stead to do so.
This power of
attorney is given as security coupled with an interest and is
irrevocable.
2.3. Free Base Rent Period.
During the five-month period between the Commencement Date and
the Rent Commencement Date, Landlord and Tenant shall comply with
all of the
terms and conditions of this Lease except that during such period
Tenant shall
not be obligated to pay Base Rent.
4
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2.4. Workletter.
Landlord has agreed to make certain improvements to the
Premises in connection with Tenant's occupancy thereof, as more
particularly
described in the Workletter attached hereto as Exhibit 2.4 (the
"Workletter").
Except as otherwise expressly set forth in the Workletter, Landlord
shall have
no obligation to make any alterations or improvements to the
Premises or provide
any allowance or credit to Tenant for such purpose.
3. USE.
3.1.
Use.
Tenant shall use and occupy the Premises for general business
office purposes and for no other purpose whatsoever. Without
limiting the
foregoing, Tenant shall not use or occupy the Premises for any
purpose that
would (a) cause the Premises or the Property to be deemed a "place
of public
accommodation" under the Americans with Disabilities Act of 1990
(the "ADA"), or
(b) be inconsistent with the operation of the Property as a first
class office
building.
4. RENT.
4.1. Base Rent.
4.1.1. Tenant shall pay Base Rent commencing on the Rent
Commencement Date and continuing throughout the Term.
4.1.2. Base Rent is payable by Tenant in monthly installments
in the amounts set forth in Subsection 1.1.4 (subject to adjustment
as set forth
in Subsection 1.1.4), without notice or demand, in advance on the
first day of
each and every calendar month from and after the Rent Commencement
Date. If the
Rent Commencement Date is a day other than the first day of a
calendar month,
Tenant shall pay Landlord, on the Rent Commencement Date, a pro
rated portion of
the monthly installment of Base Rent for such partial month, based
on the number
of days remaining in such partial month.
4.2.
Additional Rent; Rent In General.
4.2.1. All amounts payable by Tenant pursuant to this Lease
other than Base Rent are additional rent ("Additional Rent") (Base
Rent and
Additional Rent being referred to collectively as "Rent"). Landlord
shall have
the same rights and remedies for nonpayment of Additional Rent as
Landlord has
for nonpayment of Base Rent.
4.2.2. Except as specifically set forth herein, Tenant shall
pay all Rent without deduction, recoupment or setoff of any amount
for any
reason whatsoever and Tenant's covenant and agreement to pay Rent
shall for all
purposes be construed to be a separate and independent covenant.
Payments
denominated by Tenant as other than Base Rent shall not be credited
against
Tenant's obligation to pay Base Rent.
5
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4.2.3. All Rent shall be paid at the office of Landlord set
forth in Subsection 1.1.10 or such other place as Landlord may from
time to time
designate by written notice to Tenant.
4.2.4. Any payment of Rent which is not paid when due shall
bear interest at the Overdue Interest Rate from the date due until
the date paid
by Tenant. In addition, Tenant shall pay Landlord an administrative
charge of
five percent (5%) of any amount which is not paid within thirty
(30) days after
Tenant's receipt of notice from Landlord.
4.3. Payments of Less Than Full Amount Due.
Any payment by Tenant or acceptance by Landlord of less than
the full amount due from Tenant shall be treated as a payment on
account.
Landlord's acceptance of a check for less than the full amount due
with an
endorsement or statement thereon, or upon any letter accompanying a
check or
payment, that such lesser amount is payment in full or payment for
any
particular item of Rent, shall be given no effect, and Landlord may
accept such
check or payment without prejudice to any other rights or remedies
which
Landlord may have against Tenant. Landlord may apply such payments
against such
items of Rent as Landlord may in its sole discretion determine.
5. [Intentionally Omitted].
6. TAXES.
6.1. The Tax Adjustment.
Tenant shall pay Landlord as Additional Rent the Tax Adjustment
for each Tax Year from and after the Commencement Date, beginning
with the
calendar year 2007. If the Expiration Date is any date other than
the last day
of a Tax Year, the Tax Adjustment for such Tax Year shall be pro
rated based
upon the portion(s) of such Tax Year(s) that fall within the
Term.
6.2. Monthly Tax Payments.
6.2.1. From and after January 1, 2007, Tenant shall pay
Landlord monthly payments on account of the Tax Adjustment (the
"Monthly Tax
Payment(s)") for the relevant Tax Year. The Monthly Tax Payments
shall be
payable on the first day of each month throughout the Term.
6.2.2. The Monthly Tax Payments shall equal one-twelfth of the
Estimated Tax Adjustment for the relevant Tax Year. Landlord may
revise the
Estimated Tax Adjustment from time to time by notice in writing to
Tenant.
6
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6.3. Tax Statement.
Following Landlord's receipt of the annual bills for Taxes for
each Tax Year during the Term, Landlord shall furnish Tenant with a
Tax
Statement. Within thirty (30) days following the receipt of the Tax
Statement,
Tenant shall pay Landlord (or Landlord shall credit to Tenant) any
deficiency
(or excess) between the Monthly Tax Payments previously paid on
account of the
Tax Adjustment for the relevant Tax Year and the actual Tax
Adjustment for such
Tax Year. Any Tax Statement shall be deemed approved by Tenant as
correct unless
within sixty (60) days after receipt of the Tax Statement, Tenant
notifies
Landlord in writing that Tenant disputes the accuracy of the Tax
Statement,
specifying in detail the basis for such assertion. Pending the
resolution of
such dispute, Tenant shall make payments in accordance with the Tax
Statement
submitted by Landlord.
6.4. Continuing Obligation to Make Payments on Account of Next
Tax
Year.
After payment of the full amount of the Tax Adjustment for any
Tax Year, Tenant shall continue to pay Monthly Tax Payments of
one-twelfth of
the Estimated Tax Adjustment for the following Tax Year during the
Term.
6.5. Landlord's Right to Waive Requirement for Monthly Tax
Payments.
Notwithstanding the foregoing, Landlord may, from time to time,
during the Term elect to waive the requirement for payment of
Monthly Tax
Payments. In such case, Tenant shall pay the full amount of any
unpaid Tax
Adjustment within ten (10) days after Tenant receives a Tax
Statement.
6.6. Certain Reassessments .
Notwithstanding anything in this Lease to the contrary, Tenant
shall not be required to pay, and the Tax Adjustment shall not
include, Taxes
imposed by a so called "spot assessment".
7. OPERATING EXPENSES.
7.1. The Operating Expense Adjustment.
Tenant shall pay Landlord as Additional Rent the Operating
Expense Adjustment for each Operating Year, beginning with the
calendar year
2007. If the Expiration Date is any date other than the last day of
an Operating
Year, the Operating Expense Adjustment for such Operating Year
shall be pro
rated based upon the portion(s) of such Operating Year(s) that fall
within the
Term.
7.2. Monthly Expense Payments.
7.2.1. From and after January 1, 2007, Tenant shall pay
Landlord monthly payments on account of the Operating Expense
Adjustment for the
7
<PAGE>
then current Operating Year (the "Monthly Expense Payment(s)"). The
amount of
the Monthly Expense Payments shall be determined in the manner set
forth in
Subsection 7.2.3. The Monthly Expense Payments shall be payable on
the first day
of each month.
7.2.2. Following the beginning of each Operating Year, Landlord
shall submit a new Estimate Notice to Tenant. Until the Estimate
Notice is
furnished by Landlord, Tenant shall continue to pay Monthly Expense
Payments
based upon the Operating Expense Estimate for the preceding
Operating Year.
Beginning on the first day of the first month following Tenant's
receipt of the
Estimate Notice, Tenant shall commence paying the new Monthly
Expense Payment.
The new Monthly Expense Payment shall equal the Adjusted Expense
Estimate for
the then current Operating Year divided by the number of months
remaining in
such Operating Year.
7.2.3. Landlord may submit a revised Estimate Notice from time
to time during the course of an Operating Year, but not more than
twice in any
Operating Year, and beginning on the first day of the first month
following
receipt of the Estimate Notice, Tenant shall commence paying the
new Monthly
Expense Payment set forth in the Estimate Notice. The amount of the
new Monthly
Expense Payment shall be determined in accordance with Subsection
7.2.3.
7.3. Operating Expense Statement.
7.3.1. Within ninety (90) days after the end of each Operating
Year, Landlord shall furnish Tenant an Operating Expense Statement.
Within
thirty (30) days following the receipt of the Operating Expense
Statement,
Tenant shall pay Landlord (or Landlord shall credit to Tenant) any
deficiency
(or excess) between the Monthly Expense Payments paid on account of
the
preceding Operating Year's Operating Expense Adjustment and the
actual Operating
Expense Adjustment for such Operating Year.
7.3.2. Notwithstanding the foregoing, in the event that
Landlord fails to deliver to Tenant such Operating Expense
Statement on or
before October 1 of the following year, Landlord shall waive its
right to
collect any such deficiency in the payment of such Operating
Expense and in the
event that Tenant is entitled to a credit for excess payment of
Operating
Expense for such year, interest shall accrue on such amount at the
Overdue
Interest Rate from October 1 until Landlord delivers such Operating
Expense
Statement.
7.4. Inspection Right.
7.4.1. Notwithstanding anything herein to the contrary, within
one hundred twenty (120) days after Tenant's receipt of the
Operating Expense
Statement for the prior calendar year, Tenant shall have the right
to audit
Landlord's books and records in accordance with this paragraph.
Tenant shall
exercise such audit right by providing Landlord with a written
notice of
Tenant's exercise of such audit right (the "Audit Notice") given
within such one
hundred twenty (120) day period. Upon the receipt by Landlord of an
Audit
Notice, Landlord shall instruct its property manager at the
Building to arrange
to promptly meet with a designated employee of Tenant (the
"Tenant
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Representative"). Landlord shall provide the Tenant Representative
with
reasonable access to Landlord's books and records at the Building
relating to
Operating Expenses for the calendar year in question in order to
conduct a
preliminary information gathering, review and/or audit of
Landlord's books and
records pursuant to the Audit Notice. Such preliminary audit shall
occur within
thirty (30) days following Landlord's receipt of such Audit Notice
from Tenant.
If, within thirty (30) days after such preliminary informational
inspection
and/or audit by Tenant, Landlord and Tenant are unable to resolve
Tenant's
objections, then not later than fifteen (15) days after the
expiration of such
30-day period, Tenant shall notify Landlord if Tenant wishes to
employ either
(i) an independent, reputable certified public accounting firm or
(ii) an
independent, reputable lease audit firm approved by Landlord, which
is not
compensated on a contingent fee basis ("Acceptable Auditors") to
inspect and
audit Landlord's books and records for the Building relating to the
specific
objections raised in Tenant's statement. Such audit shall occur
within one
hundred twenty (120) days after Landlord's receipt of the Audit
Notice from
Tenant. No such audit by Tenant shall affect or impair Tenant's
obligations to
pay Base Rent or Additional Rent as and when due hereunder during
the pendency
of such audit. All costs and expenses of any such audit shall be
paid by Tenant,
except if Tenant's audit reveals an overcharge of more than four
percent (4%) of
Tenant's Share of Operating Expenses, then Landlord shall reimburse
Tenant for
Tenant's reasonable, out-of-pocket costs of conducting such audit,
and shall
refund or credit to Tenant the amount of such overcharge. Any audit
performed
pursuant to the terms of this section shall be conducted only by
the Acceptable
Auditors at the offices of Landlord's property management office in
the
Philadelphia area where Landlord agrees to provide all of its
records relating
to the Operating Expense Statement. Notwithstanding anything
contained herein to
the contrary, Tenant shall be entitled to exercise its audit right
pursuant to
this section only in strict accordance with the foregoing
procedures no more
often than once per calendar year and each such audit shall relate
only to the
calendar year most recently ended.
8. MAINTENANCE AND REPAIR OF THE PREMISES.
Tenant, at its sole cost and expense, shall maintain the
Premises
and the fixtures, trade fixtures, installations, equipment and
facilities in the
Premises, in good order, condition and repair at all times. Such
obligation
shall include, without limitation, all electrical, plumbing and
other mechanical
systems in the Premises, from the point such systems connect to the
Building
systems.
9. OPERATION OF THE PREMISES AND THE PROPERTY; COMMON
FACILITIES;
PARKING.
9.1. General Restrictions.
Tenant covenants and agrees, at its sole cost and expense:
9.1.1. to secure and maintain in effect any governmental
approvals, licenses and permits as may be required for Tenant's use
and
occupancy of the Premises and to provide Landlord copies of such
approvals,
licenses and permits upon request;
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9.1.2. not to do or permit anything to be done which might
cause damage to the Property or place any loads upon any floor,
wall or ceiling
which might damage or endanger any portion of the Building;
9.1.3. not to operate any equipment which would injure the
Property, overload existing electrical systems or mechanical
equipment servicing
the Building, or impair the efficient operation of the fire
protection and life
safety systems within the Building;
9.1.4. not to commit or permit to be committed any waste;
9.1.5. to keep the Premises free of nuisances;
9.1.6. to comply with all Laws relating to the Premises and
Tenant's use and occupancy of the Premises;
9.1.7. to comply with requirements of any insurance policy
maintained by Tenant with respect to the Premises; and
9.1.8. not to use or occupy the Premises in any manner which
would:
9.1.8.1. void or impair any insurance maintained by
Landlord or result in any increase in the insurance premiums
otherwise payable
by Landlord;
9.1.8.2. create any safety or environmental hazard, or
be dangerous to the Premises, the Building or the occupants of the
Premises or
the Building;
9.1.8.3. disturb other tenants or occupants of the
Building; or
9.1.8.4. violate the Rules and Regulations or any
provision of this Lease.
9.2. Rules and Regulations.
9.2.1. Tenant shall comply, and shall cause its agents,
employees, contractors, licensees and invitees to comply, with the
rules and
regulations set forth in Exhibit 9.2.1, as the same may be amended
or modified
by Landlord from time to time (the "Rules and Regulations").
9.2.2. Landlord shall have the right to amend or modify the
Rules and Regulations from time to time as Landlord shall deem
necessary or
desirable provided that such changes will not materially interfere
with Tenant's
use of the Premises, are not inconsistent with the terms and
conditions of the
Lease and Landlord shall use reasonable efforts to apply such
changes in a
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non-discriminatory manner. Landlord shall give Tenant not less than
thirty (30)
days prior written notice of the content and effective date of any
amendments or
modifications to the Rules and Regulations.
9.2.3. Landlord shall use reasonable efforts to enforce the
Rules and Regulations in a non-discriminatory manner, provided,
however,
Landlord shall not be liable to Tenant for the violation of the
Rules and
Regulations by any tenant. Landlord's failure to enforce any of the
Rules and
Regulations against Tenant or any other tenant or person shall not
constitute a
waiver thereof by Landlord.
9.3. Declaration and REA.
This Lease is subject and subordinate to the Declaration and
the REA. Tenant shall comply, and shall cause its agents,
employees,
contractors, licensees and invitees to comply with the Declaration
and any rules
or regulations promulgated by the Association.
9.4. Americans With Disabilities Act.
Without limiting the generality of Subsection 9.1.6, Tenant
agrees to comply with the ADA, which may impose requirements
relating to the
design and use of the Premises. The foregoing obligation shall not
be construed
to permit Tenant to make any Alterations without Landlord's prior
written
consent.
9.5. Common Facilities.
The Common Facilities shall at all times be subject to the
exclusive management and control of Landlord. Landlord shall have
the right to:
(a) establish, modify and enforce reasonable rules and regulations
with respect
to the Common Facilities; (b) enter into, modify and terminate
easement and
other agreements pertaining to the use and maintenance of the
parking areas and
other Common Facilities; (c) restrict parking by tenants and their
employees to
employee parking areas; (d) temporarily close portions of the
Common Facilities,
to the extent Landlord deems necessary or appropriate; (e) do and
perform such
other acts in and to the Common Facilities as Landlord deems
necessary or
appropriate; (f) change, rearrange, alter, modify, reduce,
eliminate or
supplement Common Facilities so long as adequate common facilities
are made
available to the Tenant.
9.6. Parking.
9.6.1.
Landlord shall provide 128 undesignated parking spaces
for the use of Tenant, its agents, employees, contractors,
licensees and
invitees, within the area shown on Exhibit 9.6.1, or such other
areas in
reasonable proximity to the Building as Landlord may designate from
time to
time. The foregoing number of parking spaces is based upon a
formula of four
parking spaces per 1,000 rentable square feet of space in the
Premises. The
number of parking spaces allocated to Tenant is subject to
adjustment in
accordance with such formula, based upon the final determination of
the rentable
square footage of the Premises made by Landlord's architect.
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9.6.2. Tenant shall comply, and shall cause its agents,
employees, contractors, licensees and invitees to comply, with the
rules and
regulations which Landlord may make to assure use of parking spaces
on the
Property by permitted users only. Landlord's remedies under such
rules and
regulations may include, but shall not be limited to, the right to
tow away at
the owner's expense any vehicles not parked in compliance with
these rules and
regulations upon notice to Tenant. Landlord shall not be
responsible to Tenant
for the non-compliance or breach by any other tenant of such rules
and
regulations.
10. LANDLORD'S RIGHT OF ACCESS; LANDLORD'S RIGHT TO CURE.
10.1. Right to Enter Premises.
Landlord, any Overlessor(s), and Mortgagee(s), and any agent
or employee of any of the foregoing, shall have the right to enter
the Premises
upon 24 hours' notice to Tenant (provided that no notice shall be
required in
the event of emergency) for any of the following purposes:
10.1.1. to inspect the Premises and determine Tenant's
compliance with the provisions of this Lease;
10.1.2. to make any repairs, replacements or alterations to
the Property or do any work which Landlord may deem necessary;
10.1.3. to perform any of the services required to be
performed by Landlord pursuant to this Lease;
10.1.4. to show the Premises to prospective purchasers and
within the final 12 months of the Term to prospective tenants;
and
10.1.5. for any other reasonable and appropriate purpose.
10.2. Right to Install Equipment.
Landlord may install, use, maintain, repair, replace and
relocate pipes, ducts, conduits, wires and appurtenant meters and
equipment for
service to other parts of the Building within or through the
Premises or through
the walls and columns in the Premises provided that such work shall
not
materially interfere with Tenant's use of the Premises.
10.3. Landlord's Right To Cure.
If Tenant fails to perform any of its covenants under this
Lease, Landlord may elect to perform such covenant on behalf of
Tenant after
giving Tenant at least three (3) business days written notice of
Landlord's
intention to do so, provided however, that if an emergency
situation exists, no
written notice shall be required. Tenant shall reimburse Landlord
for reasonable
sums paid or reasonable costs incurred by Landlord in curing such
default,
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together with interest at the Overdue Interest Rate from the
respective dates of
Landlord's making the payments and incurring such costs, within
thirty (30) days
after delivery of a statement from Landlord for the amount due. The
exercise by
Landlord of its rights under this Section shall not prejudice or
waive any
rights or remedies Landlord might otherwise have against
Tenant.
11. LANDLORD'S SERVICES.
11.1. HVAC.
11.1.1. The heating, ventilating and air conditioning for the
Building (including both Common Facilities and portions of the
Building which
are leased to tenants) is provided through an electrically operated
package unit
system, which is described in Exhibit 11.1.1 (the "HVAC System").
As provided in
Section 11.2 below, the costs of electrical service for the HVAC
System are
included in Operating Expenses, to the extent allocable to heating,
ventilating
and cooling of the Common Facilities in the Building. As provided
in Section
11.2 below, the costs of electrical service for the HVAC System are
payable by
Tenant, to the extent allocable to heating, ventilating and cooling
of the
Premises. Landlord shall maintain and repair the HVAC System, and
the cost
thereof shall be included in Operating Expenses.
11.1.2. If Tenant requires supplementary heating,
ventilating, or air conditioning for its Premises, Tenant shall pay
all costs in
connection with the installation and operation thereof.
11.2. Electric.
11.2.1. At Tenant's cost and expense, Landlord shall furnish
electrical service sufficient for (a) customary office lighting
levels and
operation of desktop portable office equipment, (b) the operation
of those
package units of the HVAC System which service the Premises, and
(c) any special
electrical requirements set forth in Tenant's Final Plans.
11.2.2. Tenant agrees that its consumption of electric energy
will be submetered by Landlord, or if no submeter shall be
installed, Landlord
shall reasonably calculate Tenant's consumption of electricity.
Landlord shall
compute the cost of the electricity used by Tenant on the basis of
the rate paid
by Landlord to the utility company (including all demand costs,
surcharges,
taxes, fuel adjustments, transfer charges and similar charges paid
by Landlord
to such utility) and shall bill the amount to Tenant. Upon request
of Tenant,
Landlord shall provide to Tenant copies of any such utility bills.
Tenant shall
pay Landlord all such charges as Additional Rent within ten (10)
days after
delivery of a statement from Landlord for the amount due. Tenant
acknowledges
that some of the package units of the HVAC System which service the
Premises may
now or in the future service other portions of the Building, and
that,
accordingly, Tenant's use thereof may not be separately submetered.
Landlord
shall allocate the electrical costs associated with operation of
any such
package units based upon the square footage serviced by such units,
or in
accordance with such other method as Landlord shall determine to be
reasonable.
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11.2.3. Tenant agrees that if, in the future, it is required
by the Pennsylvania Public Utility Commission or by a Federal or
state law or by
applicable tariff as a necessary condition to the supply of
electric energy to
the Premises or any part thereof, to become the direct customer of
the
applicable utility, Tenant will do so.
11.2.4. Tenant's use of electric energy shall not any time
exceed the capacity of the electric conductors, wiring or equipment
in or
serving the Premises.
11.2.5. Landlord shall promptly replace light bulbs and tubes
upon notice from Tenant. The cost of replacement light bulbs,
tubes, lamps, and
ballasts, plus the labor cost for such replacement, shall be paid
by Tenant as
Additional Rent within ten (10) days after delivery of a statement
from Landlord
for the amount due.
11.3. Water.
Landlord shall provide hot and cold water for normal lavatory
purposes. If Tenant requires water for additional purposes,
Landlord may, at
Tenant's expense, install meters to measure the water used by
Tenant for such
additional purposes. Landlord shall compute the cost of the water
used by Tenant
for such additional purposes and shall bill such amount to Tenant
on a monthly
basis. Tenant shall pay Landlord all such charges as Additional
Rent within ten
(10) days after delivery of a statement from Landlord for the
amount due.
11.4. Elevator Service.
11.4.1. Landlord shall provide normal elevator service during
Business Hours and shall provide limited elevator service at other
times.
11.4.2. Landlord shall provide freight elevator service at
reasonable times.
11.5. Janitorial Service to the Premises.
11.5.1. Landlord shall provide janitorial service to the
Premises, including general cleaning and trash removal, Monday
through Friday
(excluding Holidays), after Business Hours, in accordance with
standards
established by Landlord.
11.5.2. If Tenant requires janitorial services in excess of
those provided by Landlord, Tenant shall arrange for such
additional services
through Landlord, and shall pay Landlord for such additional
services within
thirty (30) days after delivery of a statement from Landlord for
the amount due.
11.6. Cleaning, Maintenance and Repair by Landlord.
11.6.1. Landlord shall make all necessary repairs to the
following components of the Building promptly after notice from
Tenant or
otherwise as necessary:
11.6.1.1. the exterior windows, walls and other structural
parts of the Premises and the Building;
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11.6.1.2. the base building plumbing, heating, ventilating,
air conditioning, mechanical and electrical systems;
11.6.1.3. the roof of the Building; and
11.6.1.4. the Common Facilities.
11.6.2. Landlord's obligations under Subsection 11.6.1 are
subject
to the following limitations:
11.6.2.1. Landlord shall not be obligated to make any repair
until the expiration of a reasonable period of time after receipt
of notice from
Tenant that such repair is needed. Tenant shall give Landlord
prompt written
notice of the need for any repair.
11.6.2.2. Tenant shall reimburse Landlord for all reasonable,
actual costs and expenses of repairing and replacing all damage or
injury to the
Building caused by the negligence or willful misconduct of Tenant
or any of its
employees, agents, invitees, licensees, subtenants or contractors
(each a
"Tenant Party"). Such costs and expenses shall be payable as
Additional Rent and
shall be paid by Tenant within thirty (30) days after delivery of a
statement
from Landlord for the amount due.
11.6.3. Landlord shall not be liable for any injury to or
interference with Tenant's business arising from the making of any
repairs,
alterations, additions or improvements in or to the Premises or the
Building or
to any appurtenances or equipment in the Premises or the Building
unless caused
by the negligence or willful misconduct of Landlord or any of its
employees,
agents, invitees, licensees or contractors (each a "Landlord
Party"). There
shall be no abatement of Rent because of such repairs, alterations,
additions or
improvements or because of any delay by Landlord in making the same
unless
caused by the gross negligence or willful misconduct of Landlord or
any Landlord
Party.
11.6.4. Landlord will operate and maintain the Common Facilities
on
the Property in a condition consistent with common facilities in
comparable
suburban office parks. Without limiting the generality of the
foregoing,
Landlord shall (a) keep the Common Facilities in a reasonably clean
and orderly
condition; (b) maintain all landscaped areas on the Property; and
(c) keep all
parking areas, roadways, sidewalks on the Property reasonably free
of ice and
snow, and repave, repair and restripe as needed.
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11.7. Costs of Performance.
All costs incurred by Landlord in the performance of its
obligations under this Article 11 shall be included as part of
Operating
Expenses, except for the cost of providing electrical service
pursuant to
Section 11.2, which is paid separately by Tenant.
11.8. Interruption of Services.
11.8.1. Tenant acknowledges that the services which Landlord
has agreed to provide pursuant to this Lease may be subject to
certain
slowdowns, interruptions and stoppages for various reasons,
including without
limitation the following:
11.8.1.1. voluntary agreements between Landlord and
governmental bodies and regulatory agencies;
11.8.1.2. maintenance, repair replacement or alteration of
any equipment involved in furnishing such services;
11.8.1.3. fire or other casualty, emergency, accident or act
of God;
11.8.1.4. strikes, lockouts, labor controversies;
11.8.1.5. fuel or utility shortages or unavailability of
parts, material or labor; and
11.8.1.6. other causes not within the reasonable control of
Landlord.
11.8.2. Unless caused by the gross negligence or willful
misconduct
of Landlord or any Landlord Party, no such slowdown, interruption
or stoppage of
services, shall:
11.8.2.1. impose any liability on Landlord or give rise to
any claim for damages against Landlord (including, without
limitation, any claim
for damages by reason of loss of profits, business interruption or
other
consequential damages);
11.8.2.2. constitute a default by Landlord under this Lease
or relieve Tenant from the performance of its obligations under
this Lease;
11.8.2.3. entitle Tenant to any abatement or reduction in
Rent; or
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11.8.2.4. give rise to a claim in Tenant's favor that such
absence of services constitutes actual or constructive eviction or
renders the
Premises untenantable.
12. COVENANT OF QUIET ENJOYMENT.
Provided Tenant is not in default under the Lease after the
expiration of applicable periods of notice and cure hereunder,
Tenant shall
quietly have and enjoy the Premises throughout the Term without
hindrance or
molestation by Landlord or by anyone claiming in, through or under
Landlord,
subject, however, to the exceptions, reservations and conditions of
this Lease.
13. ALTERATIONS; SIGNS.
13.1. General Requirements.
13.1.1. Tenant shall not make any alterations, additions or
improvements to the Premises ("Alterations") without the prior
written consent
of Landlord, which consent shall not be unreasonably withheld,
conditioned or
delayed. Notwithstanding the foregoing, Tenant may make
nonstructural, interior
alterations to the Premises provided that the costs of such
alterations shall
not exceed ten thousand dollars ($10,000.00). Tenant shall provide
reasonably
detailed plans and specifications for the proposed Alterations.
13.1.2. Tenant shall comply with the requirements of Exhibit
13.1.2 in connection with the construction of any Alterations.
13.2. Removal of Alterations.
Upon the expiration or earlier termination of the Term, all
Alterations shall remain on the Premises and become the property of
Landlord
unless, upon notice from Tenant to Landlord prior to the
installation of such
Alterations by Tenant requesting Landlord's determination, Landlord
shall give
written notice to Tenant to remove the same in accordance with the
provisions of
this Section. Tenant immediately will remove any Alterations which
Landlord
requires that Tenant remove, and will repair and restore any damage
to the
Premises caused by the installation or removal thereof. Without
limiting the
generality of the foregoing, if required by Landlord, all wiring
and cabling
installed by or for Tenant, whether inside or outside the Premises,
shall be
removed by Tenant (or, at Landlord's election, by Landlord), at
Tenant's sole
cost and expense, at the expiration or earlier termination of the
Term. If
Tenant fails to perform any of its obligations under this Section
13.2, Landlord
may perform such obligations on behalf of Tenant, and the cost and
expense
thereof, together with interest at the Overdue Interest Rate from
the date such
costs and expenses were incurred by Landlord, shall be paid by
Tenant to
Landlord as Additional Rent within thirty (30) days after delivery
of a
statement from Landlord for the amount due.
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13.3. Signs.
13.3.1. Landlord shall:
13.3.1.1. include Tenant's name on the main lobby Building
directory, at Landlord's expense;
13.3.1.2. install Building standard directory signage
identifying Tenant in the common multi-tenant elevator lobby on the
second floor
of the Building, at Landlord's expense;
13.3.1.3. install Building standard entry signage identifying
Tenant at the door of the Premises, at Landlord's expense.
13.3.2. Tenant shall not install any signs in or on the
Premises
that are visible outside the Premises without the prior written
consent of
Landlord.
13.3.3. The installation of signs shall be considered an
Alteration, and Tenant shall comply with the requirements of
Exhibit 13.1.2 in
connection with the installation of signs.
13.3.4. Tenant shall have the right to remove any signs
installed
by Tenant at the termination of the Term, provided Tenant is then
not in default
under this Lease after expiration of applicable periods of notice
and cure. In
addition, Tenant shall be obligated to remove any signs installed
by Tenant if
Landlord requires that Tenant remove the same. Tenant shall repair
and restore
any damage to the Premises caused by the installation or removal of
any signs,
whether such signs are removed at the election of Tenant or
pursuant to the
requirement of Landlord. Should Tenant fail to perform any of its
obligations
under this Subsection 13.3.3, Landlord may perform such obligations
on behalf of
Tenant, and the cost and expense thereof, together with interest at
the Overdue
Interest Rate from the date such costs and expenses were incurred
by Landlord,
shall be paid by Tenant to Landlord as Additional Rent within
thirty (30) days
after delivery of a statement from Landlord for the amount due.
14. INDEMNIFICATION; INSURANCE.
14.1. Indemnification.
Tenant covenants and agrees to exonerate, indemnify, defend,
protect and save harmless Landlord, any Overlessors, any Mortgagees
and their
respective affiliates, partners, shareholders, officers, directors,
agents and
employees, from and against any and all claims, demands, costs,
expenses,
losses, liabilities, suits and actual damages arising from or
relating to:
14.1.1. any occurrence of any nature on the Premises not
caused by the gross negligence or willful misconduct of Landlord or
any Landlord
Party;
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14.1.2. any occurrence of any nature in any other part of the
Property arising from the gross negligence or willful misconduct of
Tenant or
Tenant Party;
14.1.3. injury to persons or damage to property caused by the
gross negligence or willful misconduct of Tenant or any Tenant
Party; or
14.1.4. any breach by Tenant, its agents, employees,
contractors, subtenants, licensees or invitees of any covenant,
agreement,
representation or warranty made by Tenant pursuant to this
Lease.
14.1.5. Landlord covenants and agrees to exonerate,
indemnify, defend, protect and save harmless Tenant and its
affiliates,
partners, shareholders, officers, directors, agents and employees,
from and
against any and all claims, demands, costs, expenses, losses,
liabilities, suits
and actual damages arising from or relating to:
14.1.5.1. any occurrence of any nature in the Common
Facilities not caused by the gross negligence or willful misconduct
of Tenant or
any Tenant Party;
14.1.5.2. any occurrence of any nature in any other
part of the Property arising from gross negligence or willful
misconduct
Landlord or any Landlord Party;
14.1.5.3. injury to persons or damage to property
caused by the gross negligence or willful misconduct of Landlord or
any Landlord
Party; or
14.1.5.4. any breach by Landlord or any Landlord
Party of any covenant, agreement, representation or warranty made
by Tenant
pursuant to this Lease.
14.2. Tenant's Insurance.
Tenant, at its sole cost and expense, shall maintain the
following insurance coverages in full force and effect during the
Term:
14.2.1. excess commercial general liability insurance,
including contractual liability insuring the indemnification
provisions
contained in this Lease, against claims for personal injury,
including bodily
injury, death and property damage in an amount not less than Ten
Million Dollars
($10,000,000) annual aggregate, which may be in excess of
self-insured
retentions maintained by Tenant with such commercially reasonable
increases as
Landlord and Tenant may agree upon depending on the availability
and cost of
such insurance;
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14.2.2. worker's compensation insurance in form and amounts
required by law;
14.2.3. special form (causes of loss) non-contributory
property insurance (formerly known as "all risks" insurance), for
the full
replacement cost of all Alterations, furniture, trade fixtures,
equipment,
inventory, and all other items of Tenant's property on the
Premises, including
coverage for sprinkler leakage;
14.2.4. business income insurance in an amount sufficient to
reimburse Tenant for loss of earnings attributable to prevention of
access to
the Building or Premises for a period of at least one year; and
14.3. Policy Requirements.
14.3.1. Each policy of insurance required to be maintained by
Tenant shall:
14.3.1.1. be issued by insurance companies, qualified
to do business in the Commonwealth of Pennsylvania, having a rating
of A/VIII or
better under the then current edition of Best's Insurance Reports,
published by
A.M. Best Co, and otherwise acceptable to Landlord.
14.3.2. The insurance maintained by Tenant pursuant to
Subsection 14.2.1 shall:
14.3.2.1. name Landlord as an additional insured;
14.3.2.2. be written on a claims made basis.
14.4. Delivery of Certificates; Failure to Maintain
Insurance.
14.4.1. Upon the execution of this Lease and within ten (10)
days prior to the expiration of each policy required under Section
14.3, Tenant
shall deliver to Landlord certificates evidencing the foregoing
insurance or
renewal thereof, as the case may be.
14.4.2. If Tenant fails, refuses or neglects to obtain or to
maintain any insurance that it is required to provide or to furnish
Landlord
with satisfactory evidence of coverage on any such policy, Landlord
shall have
the right to purchase such insurance twenty-four (24) hours after
it has
provided Tenant with telephonic notice that it intends to do so
unless within
such twenty-four (24) hour period, Tenant furnishes Landlord with
evidence that
Tenant has procured such insurance. Tenant shall reimburse Landlord
for all such
commercially reasonable payments made by Landlord, together with
interest
thereon at the Overdue Interest Rate from the date paid by
Landlord, within ten
(10) days after delivery of a statement from Landlord for the
amount due.
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14.5. Waiver of Subrogation.
14.5.1. Landlord and Tenant, for themselves and their
respective insurers, hereby release each other of and from any and
all claims,
demands, actions and causes of action, (including, without
limitation,
subrogation claims), for loss or damage to their respective
property, even if
the loss or damage shall have been caused by the fault or
negligence of the
other party, or anyone for whom such party may be responsible.
Landlord
acknowledges that the excess commercial general liability insurance
purchased by
the Tenant does not contain a "Waiver of Subrogation" clause.
14.5.2. The waiver and release provided in Subsection 14.5.1
shall be effective only with respect to loss or damage (a) covered
by insurance
or required to be covered by insurance pursuant to the terms of
this Lease, and
(b) occurring during such time as the relevant insurance policy
contains either
(i) a waiver of the insurer's right of subrogation against the
other party, or
(ii) a clause or endorsement to the effect that the waiver and
release provided
in Subsection 14.5.1 shall not adversely affect or impair such
insurance or
prejudice the right of the insured to recover under the insurance
policy. Each
party will use its best efforts to obtain such a clause or
endorsement, but if
an additional premium is charged therefor, the party benefiting
from such clause
or endorsement, if it desires to have such waiver, will pay to the
other the
amount of such additional premium within ten (10) days after
delivery of a
statement for the amount due.
14.5.3. The waiver and release by Landlord in Subsection
14.5.1 shall not apply to any loss or damage to the Building caused
by Tenant or
anyone for whom Tenant may be responsible, to the extent of the
coinsured or
self-insured portion of any loss, the portion of any loss within
the deductible
amount under any insurance, or to the extent of any loss not
covered by
insurance proceeds for any reason.
14.6. Self Insurance.
14.6.1. Notwithstanding anything to the contrary contained in
the foregoing provisions of this Article 14, Tenant (but not any
assignee or
subtenant) may elect at any time during the Term of this lease not
to carry all
or any of the insurance required under Sections 14.2.1 and 14.2.4
and to "self
insure" against all or any such risks not otherwise insured by a
third-party
carrier, provided that Tenant's self insurance in place of
liability insurance
shall be primary to Landlord's insurance to the extent Landlord is
liable for
the acts of the Tenant.
15. DAMAGE OR DESTRUCTION.
15.1. Duty to Restore; Limitations.
15.1.1. In the event of damage to or destruction of the
Premises or the Base Building caused by fire or other casualty,
Landlord shall
repair and restore the Premises and the Base Building subject to
and in
accordance with the provisions of this Article 15.
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15.1.2. Landlord's obligations under Subsection 15.1.1 are
subject to the following limitations:
15.1.2.1. Landlord shall have no obligation to make
such repairs or restoration if either Landlord or Tenant terminates
this Lease
pursuant to this Article 15;
15.1.2.2. Landlord shall have no obligation to repair
or restore any Alterations made by Tenant, any trade fixtures, or
any property
belonging to Tenant.
15.2. Landlord's Right to Terminate.
15.2.1. Landlord shall have the right to terminate this Lease
effective as of the date of such casualty in any of the following
circumstances,
by giving notice of termination to Tenant at any time within
forty-five (45)
days after the occurrence of the fire or other casualty:
15.2.1.1. if the damage is of such a nature or extent
that, in Landlord's judgment, more than 180 days, after
commencement of the
work, would be required to repair and restore the damage;
15.2.1.2. if the damage is of such nature or extent
that, in Landlord's reasonable judgment, it would be uneconomical
to restore and
repair the Property;
15.2.1.3. if less than two years of the Term remain
at the time of the casualty and the damage is of such a nature or
extent that,
in Landlord's judgment, more than 90 days, after commencement of
the work, would
be required to repair and restore the damage;
15.2.1.4. if the casualty is not covered by insurance
required to be carried by Landlord under the Lease, and is not of a
type insured
against under standard fire policies with extended type coverage or
available
insurance proceeds are insufficient to repair or restore the
damage; or
15.2.1.5. if any Mortgagee does not permit the
application of adequate insurance proceeds for restoration.
Landlord's notice of termination shall specify a date for
termination of this
Lease, which shall not be more than thirty (30) days after such
notice is given.
Notwithstanding the foregoing, if Tenant maintains operations from
the Premises
in its normal course after such casualty, the Lease shall terminate
not less
than one hundred twenty (120) days after Tenant's receipt of
Landlord's notice
of termination.
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15.3.
Tenant's Right to Terminate.
15.3.1. Within forty five (45) days after the occurrence of a
fire
or other casualty, Landlord shall advise Tenant of the period of
time which
Landlord anticipates will be required to restore the Premises to a
tenantable
and accessible condition. If damage is of such a nature or extent
that, in
Landlord's judgment, more than one hundred eighty (180) days (or
more than
ninety (90) days if less than two years of the Term remain at the
time of the
casualty), after commencement of the work, would be required to
restore the
Premises, Tenant shall have the right to terminate this Lease
effective as of
the date of such casualty.
15.3.2. The validity and effect of this Lease shall not be
impaired
in any way by the failure of Landlord to complete repairs and
restoration within
one hundred eighty (180) days after the commencement of the work,
even if
Landlord had in good faith notified Tenant that the repair and
restoration could
be completed in such period, so long as Landlord proceeds
diligently with such
restoration.
15.4. Rent Abatement.
In the case of damage to the Premises or Base Building not
caused
by the gross negligence or willful misconduct acts of Tenant which
renders all
or a portion of the Premises untenantable or inaccessible, the Base
Rent
otherwise payable by Tenant under this Lease shall abate in
proportion to the
amount of space in the Premises rendered untenantable or
inaccessible for the
period such space remains untenantable or inaccessible.
16. CONDEMNATION.
16.1. Total Taking.
In the event of a Taking (other than for temporary use) of
(a) the entire Premises, or (b) all means of access to the
Premises, or (c) such
a substantial part of the Premises that the remaining portion of
the Premises is
unsuitable, in Tenant's reasonable judgment, for the continued use
and occupancy
by Tenant in the conduct of its business, or (d) such a substantial
part of the
Property that, in Landlord's reasonable judgment, it is impractical
or
uneconomical to restore the remainder thereof, this Lease shall
terminate as of
the date that possession is delivered to the condemning authority.
Any Taking of
the Premises which results in the termination of this Lease
pursuant to this
Section 16.1, is referred to as a "Total Taking."
16.2. Partial Taking.
In the event of a Taking which is not a Total Taking (a
"Partial Taking"):
16.2.1. this Lease shall remain in full force and effect as
to the portion of the Premises remaining immediately after such
Taking;
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16.2.2. the Base Rent shall be reduced in proportion to the
reduction in the square footage of the Premises, and Tenant's Share
shall be
appropriately adjusted; and
16.2.3. Landlord shall restore and repair the Premises as
nearly as possible to its condition and character immediately prior
to such
Taking, except for any reduction in area caused by the Taking.
16.3. Landlord's Right To Terminate.
Notwithstanding the provisions of Section 16.2, in the event
of a Partial Taking, Landlord shall have the right to terminate
this Lease in
any of the following circumstances: (a) if less than two years of
the Term
remain at the time of the Taking; or (b) if any Mortgagee does not
permit the
application of adequate condemnation proceeds for restoration. In
the event that
Landlord gives notice of such termination, this Lease shall
terminate as of the
date that possession of the portion of the Property which is
subject to the
Taking is delivered to the condemning authority.
16.4. Award.
Tenant hereby waives any loss or damage and any claim
therefor resulting from a Taking, except that Tenant may make a
separate claim
against the condemning authority for any moving, removal and
business
dislocation damages, personal property of Tenant or expenses
payable to tenants
under applicable law, but in no event shall Tenant make any claim
against
Landlord, the condemning authority or any party having an interest
in the
Premises, which would result in the diminution or reduction in the
award for the
Premises to Landlord or to any other party having an interest in
the Premises.
17. [Intentionally Omitted].
18. SUBLETTING AND ASSIGNMENT.
18.1. Notice of Intent; Landlord's Right to Terminate.
18.1.1. In the event Tenant intends to assign this Lease or
sublet all or any portion of the Premises, Tenant shall give notice
thereof to
Landlord ( a "Notice of Intent"). Tenant's Notice of Intent shall
be in writing
and shall contain the following information:
18.1.1.1. the name, address, and description of the
business of the proposed assignee or subtenant;
18.1.1.2. the most recent financial statement of the
proposed assignee or subtenant and other evidence of financial
responsibility;
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18.1.1.3. a description of the intended use of the
Premises by the proposed assignee or subtenant; and
18.1.1.4. the terms and conditions of the proposed
assignment or subletting.
18.1.2. Landlord shall have the right to terminate this Lease
by giving Tenant notice of Landlord's election to do so within
thirty (30) days
after the receipt of Tenant's Notice of Intent. If Landlord elects
to terminate
this Lease, such termination shall become effective on the
commencement date of
the proposed sublease or assignment. Notwithstanding the foregoing,
Tenant may
elect to rescind such request to assign or sublease the Premises by
providing
written notice to Landlord within fifteen (15) business days after
Tenant's
receipt of the Landlord's notice of termination.
18.2. Consent Required.
18.2.1. If Landlord does not elect to terminate this Lease,
Tenant may proceed with the assignment or sublease in accordance
with the Notice
of Intent, subject to Landlord's prior written consent (except as
set forth in
Section 18.7), which consent shall not be unreasonably withheld or
delayed.
Without limiting the generality of the foregoing, it shall not be
unreasonable
for Landlord to withhold its consent if: (a) the reputation or
financial
responsibility of the proposed assignee or subtenant is
unsatisfactory to
Landlord; (b) Landlord deems the business of the proposed assignee
or subtenant
not to be consonant with that of other tenants in the Building; (c)
the intended
use by the proposed assignee or subtenant conflicts with any
commitment made by
Landlord to any other tenant in the Building; or (d) the use of the
Premises by
the proposed subtenant or assignee would result in an increase in
traffic in the
Building or in demand on Building services, maintenance or
facilities. Any
failure by Landlord to approve or disapprove of such assignment or
sublease
within fifteen (15) days after Landlord's receipt of such notice
shall be deemed
to be an approval by Landlord of such assignment or sublease.
18.2.2. Tenant shall pay Landlord, as Additional Rent, the
sum of Five Hundred Dollars ($500.00) to cover Landlord's
administrative costs
and counsel fees, in connection with any subletting or assignment
to which
Landlord consents.
18.3. Profit.
If Tenant subleases all or any portion of the Premises or
assigns this Lease, Tenant shall pay Landlord as Additional
Rent:
18.3.1. Fifty percent (50%) of any rent or other
consideration paid to Tenant in excess of the Base Rent and
Additional Rent
payable by Tenant pursuant to this Lease in respect of the space
covered by the
sublease or assignment (at the rates per rentable square foot
payable by Tenant
under this Lease) and third party out of pocket costs directly
incurred with
respect to such assignment of sublease (brokerage commissions,
etc.).
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18.4. Joint and Several Liability.
Each assignee of the tenant's interest under this Lease shall
assume and be deemed to have assumed this Lease and shall be and
remain liable
jointly and severally with Tenant for all payments and for the due
performance
of all terms, covenants, conditions and provisions herein contained
on Tenant's
part to be observed and performed. No assignment shall be binding
upon Landlord
unless the assignee shall deliver to Landlord an instrument in form
and
substance satisfactory to Landlord containing a covenant of
assumption by the
assignee, but the failure or refusal of an assignee to execute and
deliver the
same shall not release assignee from its liability as set forth in
this Section.
18.5. No Waiver of Future Compliance.
Any consent granted by Landlord under this Article 18 shall
not constitute a waiver of strict future compliance by Tenant with
the
provisions of this Article 18 or a release of Tenant from the full
performance
by Tenant of any of the terms, covenants, provisions, or conditions
contained in
this Lease. The acceptance by Landlord of the payment of Rent from
any person
following any transfer prohibited by this Article 18, shall not be
deemed
consent by Landlord to any such transfer, nor shall such acceptance
constitute a
waiver of any of the rights or remedies of Landlord.
18.6. Transfer of Control; Transfers By Legal Process or
Operation
of Law.
For purposes of this Article 18:
18.6.1. any transfer or change in control of Tenant, whether
by operation of law or otherwise, shall be deemed an assignment,
including,
without limitation, any merger, consolidation, reorganization,
liquidation,
dissolution or any change in the ownership of a controlling
percentage of the
equity interests in Tenant, whether in a single transaction or a
series of
transactions;
18.6.2. any transfer of Tenant's interest in this Lease by
levy or sale on execution, or other legal process, or by operation
of law, and
any transfer in bankruptcy or insolvency, or under any other
compulsory
procedure or order of court shall be deemed an assignment.
18.7. Sublease or Assignment to Permitted Transferees.
18.7.1. Notwithstanding anything to the contrary set forth in
this Article 18, (a) Tenant shall have the right to assign this
Lease to a
Permitted Transferee or sublease all or any portion of the Premises
to a
Permitted Transferee, without the consent of Landlord, and (b)
Landlord's right
of termination under Section 18.1.2 shall not apply to an
assignment or a
sublease of all or any portion of the Premises to a Permitted
Transferee. All of
the other provisions of this Article 18, including without
limitation, Section
18.3 and Section 18.4, shall apply to an assignment of this Lease
to a Permitted
Transferee or a sublease of all or any portion of the Premises to a
Permitted
Transferee.
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18.7.2. Although Landlord's consent is not required with
respect to an assignment or subletting to a Permitted Transferee,
Tenant shall
provide Landlord a copy of such assignment or sublease instrument
within thirty
(30) days after the occurrence of any assignment or subletting to a
Permitted
Transferee
19. MORTGAGEE PROVISIONS; ESTOPPEL CERTIFICATE.
19.1. Subordination.
19.1.1. This Lease and the estate, interest and rights hereby
created shall be subordinate to the following; provided that said
subordination
is contingent upon such Overlessor or Mortgagee executing a
commercially
reasonable form of subordination, nondisturbance and attornment
agreement in
favor of Tenant:
19.1.1.1. all underlying agreements, leases or other
instruments by virtue of which Landlord is or may be entitled to
possession of
the Property, whether now existing or hereafter made
("Overleases");
19.1.1.2. all mortgages which cover or include the
Property or any estate or interest in the Property, whether now
existing or
hereafter made ("Mortgages"); and
19.1.1.3. all renewals, extensions, amendments,
consolidations, replacements, restatements and modifications of any
Overleases
and Mortgages, whether now existing or hereafter made.
19.1.2. Notwithstanding the foregoing, the lessor under any
Overlease (an "Overlessor") and/or the mortgagee under any Mortgage
(a
"Mortgagee") may, at any time, subordinate its interest to this
Lease, without
Tenant's consent, by notice in writing to Tenant, and thereupon
this Lease shall
be deemed prior to such Overlease or such Mortgage, as the case may
be, without
regard to their respective dates of execution and delivery.
19.2. Attornment.
Tenant agrees that in the event any person, firm, corporation
or other entity (including any Overlessor or any Mortgagee)
acquires the right
to possession of the Property, Tenant shall, if requested by such
person, firm,
corporation or other entity, attorn to and become the tenant of
such person,
firm, corporation or other entity upon the same terms and
conditions as are set
forth in this Lease for the balance of the Term.
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19.3. Further Assurances.
Within ten (10) business days following request by Landlord,
Tenant shall execute any such instruments in recordable form as may
be
reasonably required by Landlord in order to confirm the
subordination of this
Lease and the attornment of Tenant to future landlords in
accordance with the
terms of this Article. In the event Tenant fails to execute and
deliver such
agreements within ten (10) business days of written request by
Landlord, Tenant
does hereby make, constitute and appoint Landlord as Tenant's
attorney-in-fact
and agent in its name, place and stead to do so solely for the
purpose stated
herein. This power of attorney is given as security coupled with an
interest and
is irrevocable.
19.4. Modifications.
In the event that any existing or prospective Mortgagee or
Overlessor requires a modification or modifications of this Lease,
which
modification or modifications will not cause an increase in Rent or
in any other
way materially and adversely change the rights or obligations of
Tenant under
this Lease, Tenant agrees that this Lease may be so modified and
agrees to
execute whatever documents are required therefor and deliver the
same to
Landlord within ten (10) business days following written request by
Landlord.
19.5. Right to Cure.
In the event of any default by Landlord which would give
Tenant the right to exercise any right or remedy against Landlord,
Tenant shall
not exercise any such right or remedy until it has notified each
Mortgagee and
Overlessor in writing (if the name and address of such Mortgagee(s)
and
Overlessor(s) have previously been furnished by written notice to
Tenant) of
such default, and until a reasonable period not to exceed thirty
(30) days for
curing the default shall have elapsed following the giving of
notice, during
which period the Mortgagee(s) and Overlessor(s) shall have failed
to commence
and diligently continue to cure the default or to cause the same to
be remedied
or cured.
19.6. Limitations on Liability of Mortgagees/Overlessors.
No Mortgagee or Overlessor, and no other person or entity
acquiring the Premises as a result of foreclosure or other judicial
sale, and no
successor or assign of any of the foregoing shall be:
19.6.1. liable for any act or omission of any prior landlord
under this Lease, provided, however, that such Mortgagee or
Overlessor shall be
liable for the performance of all obligations of landlord arising
from and after
the date it takes title to the Property;
19.6.2. obligated to construct or complete any improvements
to the Property or the Premises or to provide any allowance or
credit to Tenant
for so doing, or liable for any failure of any prior landlord to do
so;
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19.6.3. bound by any provision in this Lease relating to the
application of insurance or condemnation proceeds, or obligated to
reconstruct
the Property or the Premises following the occurrence of
