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Exhibit 10.12
Table of Contents
TABLE OF CONTENTS
OF LEASE BETWEEN 46.24 ASSOCIATES L.P., AS LANDLORD,
AND PTC THERAPEUTICS, INC., AS TENANT, FOR PREMISES LOCATED IN
100 CORPORATE COURT, MIDDLESEX BUSINESS CENTER,
SOUTH PLAINFIELD, NEW JERSEY
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ARTICLE 1.
DEMISED PREMISES AND TERM..................................
1
ARTICLE 2.
USE AND OPERATION..........................................
3
ARTICLE 3.
RENT.......................................................
3
ARTICLE 4.
SUBORDINATION..............................................
4
ARTICLE 5.
AS-IS; LANDLORD'S WORK; TENANT'S WORK......................
6
ARTICLE 6.
ALTERATIONS AND REPAIRS....................................
11
ARTICLE 7.
INDEMNITY AND INSURANCE....................................
14
ARTICLE 8.
FIRE DAMAGE................................................
16
ARTICLE 9.
WAIVER OF SUBROGATION......................................
17
ARTICLE 10.
CONDEMNATION...............................................
17
ARTICLE 11.
ASSIGNMENT AND SUBLETTING..................................
18
ARTICLE 12.
COMMON AREA MAINTENANCE....................................
20
ARTICLE 13.
UTILITIES..................................................
22
ARTICLE 14.
TAXES......................................................
23
ARTICLE 15.
REMEDIES OF LANDLORD.......................................
24
ARTICLE 16.
WAIVER OF TRIAL BY JURY....................................
27
ARTICLE 17.
ACCESS TO PREMISES.........................................
27
ARTICLE 18. NO
WAIVER..................................................
28
ARTICLE 19.
REQUIREMENTS OF LAW; INSURANCE REQUIREMENTS................
28
ARTICLE 20.
SIGNS......................................................
29
ARTICLE 21.
TENANT'S ADDITIONAL COVENANTS..............................
29
ARTICLE 22.
EASEMENTS FOR UTILITIES....................................
31
ARTICLE 23.
CONSENTS AND APPROVALS.....................................
31
ARTICLE 24.
CONTROL OF TENANT..........................................
31
ARTICLE 25. END
OF TERM HOLDOVER.......................................
31
ARTICLE 26.
AUTHORITY TO EXECUTE.......................................
33
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Table of Contents
(continued)
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ARTICLE 27.
NOTICES....................................................
33
ARTICLE 28.
BROKER.....................................................
33
ARTICLE 29.
MEMORANDUM OF LEASE........................................
33
ARTICLE 30. AIR
AND WATER POLLUTION....................................
33
ARTICLE 31.
SUBDIVISION................................................
36
ARTICLE 32.
THERE IS NO ARTICLE 32 IN THIS LEASE.......................
36
ARTICLE 33.
FINANCING REQUIREMENTS.....................................
36
ARTICLE 34.
RELATIONSHIP OF PARTIES....................................
37
ARTICLE 35.
CAPTIONS...................................................
37
ARTICLE 36.
DEFINITIONS................................................
37
ARTICLE 37.
ENTIRE AGREEMENT...........................................
37
ARTICLE 38.
SUCCESSORS IN INTEREST.....................................
37
ARTICLE 39.
SECURITY...................................................
38
ARTICLE 40.
EXTENSION OPTION(S)........................................
40
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THIS
LEASE, made as of the 11th day of July 2000, by and between
46.24
ASSOCIATES L.P., a Delaware limited partnership, having a mailing
address c/o
National Realty & Development Corp., 3 Manhattanville Road,
Purchase, New York
10577 (hereinafter referred to as "Landlord") and PTC THERAPEUTICS,
INC., a
Massachusetts corporation, having its principal office at 2
Chestnut Street,
Grafton, Massachusetts 01519 (hereinafter referred to as
"Tenant").
WITNESSETH:
WHEREAS, the Landlord has constructed a building (hereinafter
referred to
as "Building") for the purposes of office use, known as Building
No. 100 located
within the area designated as Lot No. 46.24 (hereinafter referred
to as "Lot No.
46.24") on the attached plot plan (hereinafter referred to as "Plot
Plan") which
is annexed hereto as Exhibit "A" and made a part hereof; and
WHEREAS, Landlord and the owner of the area designated as Lot Not
46.25
(hereinafter referred to as "Lot No. 46.25") on the Plot Plan each
has the right
to operate and use the Common Areas (as hereinafter defined) within
Lots 46.24
and 46.25; and
WHEREAS, Tenant is desirous of leasing from Landlord and Landlord
is
desirous of leasing to Tenant certain premises in the Building
which is situated
within MIDDLESEX BUSINESS CENTER (hereafter referred to as
"Center") hereinafter
described, upon and subject to the provisions, agreements,
covenants and
conditions set forth herein;
NOW,
THEREFORE, it is mutually agreed as follows:
ARTICLE 1. DEMISED PREMISES AND TERM
Section 1.01.
(a) In consideration of the rents and additional rents
hereinafter
reserved and all of the provisions, agreements, covenants and
conditions
hereinafter contained, Landlord hereby leases and demises to
Tenant, and Tenant
hereby hires, leases and takes from Landlord approximately 21,700
square feet of
floor space ("Floor Space") in the Building, more particularly
indicated and
described by cross-hatching on the Plot Plan (such Floor Space
being hereinafter
referred to as the "Demised Premises") located on Lot No. 46.24 in
the Center
located in the BOROUGH OF SOUTH PLAINFIELD, COUNTY OF MIDDLESEX and
STATE OF NEW
JERSEY, together with all improvements to be constructed thereon by
the Landlord
for the use of the Tenant, and all easements, tenements and
appurtenances
thereto.
(b) The parties acknowledge that the Landlord intends to erect or
has
erected other buildings on Lot No. 46.24 (which may be different in
design and
construction from the Building) which buildings may be constructed
at the sole
option of Landlord. Landlord shall have sole control and discretion
in
connection with the scope, design and aesthetics of any such
additional
construction. Notwithstanding the foregoing, any such other
buildings and
improvements associated therewith shall not unreasonably interfere
with access
to the Demised Premises or the loading area thereof, nor reduce the
number of
parking spaces below the number required by municipal code.
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(c) The Demised Premises are demised and let subject to (i) the
existing state of the title thereof; (ii) any state of facts which
an accurate
survey or physical inspection thereof might disclose; (iii) all
zoning
regulations, restrictions, rules and ordinances now in effect or
hereafter
adopted by any governmental authority having jurisdiction; and (iv)
any utility,
sewer or drainage easements or agreements and the installations
made pursuant
thereto now existing or hereafter granted or installed; all
without
representation or warranty by Landlord, except as expressly set
forth herein.
Notwithstanding the foregoing, Landlord hereby represents, that, to
the best of
Landlord's knowledge: (a) the Building is presently zoned to permit
the use of
the Demised Premises for typical office/laboratory purposes; and
(b) any
existing utility, sewer or drainage easements or agreements and
the
installations made pursuant thereto will not unreasonably interfere
with
Tenant's use and occupancy of the Demised Premises. Landlord
further represents
to Tenant that Landlord is presently the fee owner of the Building
and is
authorized and empowered to enter into this Lease as Landlord and
to perform the
obligations of Landlord hereunder.
Section 1.02. As long as Tenant occupies the Demised Premises,
Tenant,
together with its employees, customers, invitees and business
guests, shall have
the right to use, in common with Landlord, its successors, assigns,
tenants,
subtenants, designees, concessionaires, licensees and any of their
customers,
invitees, and business guests, all of the Common Areas (as such
term is defined
in Section 12.01 hereof) at any time and from time to time existing
within Lot
No. 46.24, except for areas reserved for the exclusive use of other
tenants,
occupants, or designees and except for periods of time during which
the Common
Areas are being repaired, altered or reconstructed. Neither
Landlord nor Tenant
nor anyone holding under or through either of them shall make any
charge for the
use of the Common Areas to the other or to the employees,
customers, invitees or
business guests of Landlord or Tenant or of anyone else
hereinbefore granted the
right to use the Common Areas, except as provided in Article 12 of
this Lease.
Section 1.03. The term ("Term") of this Lease shall commence on
that date
("the Commencement Date") which is the first to occur of: (a) the
date upon
which the Demised Premises are first occupied by Tenant for the
conduct of
business operations at the Demised Premises, or (b) the date which
is thirty
(30) days following the date upon which the Landlord's Work (as
hereinafter
defined) shall be duly certified by Landlord or Landlord's agent as
being
substantially completed, except for those items the completion of
which will not
unreasonably interfere with Tenant's use and occupancy of the
Demised Premises
as provided herein, and shall expire on the date which is the FIVE
(5) years
following the last day of the calendar month in which the Rent
Commencement Date
(as hereinafter defined) shall occur ("Expiration Date"). Landlord
represents to
Tenant that Landlord's Work shall be performed in accordance with
all applicable
codes so as to enable Tenant to apply for and obtain a certificate
of occupancy
for the Demised Premises upon completion of Tenant's improvements
and Tenant's
fixturing and equipping of the Demised Premises. Tenant may, at any
time after
execution of this Lease and prior to the Commencement Date, without
incurring
any liability for payment of annual minimum rental or additional
rent, measure
the Demised Premises, design and layout of the tenant improvements
and Tenant's
Property (hereinafter defined), and place and install its personal
property,
furniture, furnishings, signs, telecommunication equipment,
equipment and trade
fixtures ("Tenant's Property"), in the Demised Premises at Tenant's
risk and
expense. In exercising the foregoing rights, Tenant shall not cause
any material
interference with or delay to
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Landlord, and Tenant's indemnity provided for in this Lease shall
apply to
Tenant's entry under this Section.
Section 1.04. The parties shall, within ten (10) days following
request of
the other, execute a written document, in recordable form,
expressing the
Commencement Date and Expiration Date of the Term hereof, as such
have been
determined in accordance with the provisions of this Lease.
Section 1.05. The term "Lease Year" is defined to mean twelve
(12)
consecutive calendar months; the first Lease Year to commence on
the first day
of the succeeding calendar month following the Commencement Date
and each
succeeding Lease Year to commence on the anniversary date of the
commencement of
the first Lease Year. The portion of the Term prior to the first
Lease Year
shall be deemed a "Partial Lease Year" and any obligations of
Tenant for such
Partial Lease Year shall be prorated on a per diem basis.
ARTICLE 2. USE AND OPERATION
Section 2.01. Subject to the other provisions of this Lease, Tenant
shall
occupy and use the Demised Premises solely for office and
laboratory purposes
and incidental uses normally associated therewith, and for no other
use. Tenant
hereby covenants and agrees that it, its successors and assigns, or
anyone
holding by, through or under them, shall not use, nor permit the
use of the
Demised Premises for any other use or purpose. Immediately
following
certification under Section 1.03 above, Tenant shall fixture,
furnish and equip
the Demised Premises for Tenant's intended business purpose and
upon the
Commencement Date, Tenant shall occupy and open for business in the
Demised
Premises.
ARTICLE 3. RENT
Section 3.01. The annual minimum rental during the Term shall be
as
follows:
(A)
During the FIRST (1st) and SECOND (2nd) years following the
Rent
Commencement Date: ONE HUNDRED EIGHT FOUR THOUSAND FOUR HUNDRED
FIFTY AND 00/100
($184,450.00) DOLLARS per annum - FIFTEEN THOUSAND THREE HUNDRED
SEVENTY AND
00/100 ($15,370.00) DOLLARS per month;
(B)
During the THIRD (3rd) year following the Rent Commencement Date:
ONE
HUNDRED NINETY FIVE THOUSAND THREE HUNDRED AND 00/100 ($195,300.00)
DOLLARS per
annum - SIXTEEN THOUSAND TWO HUNDRED SEVENTY FIVE AND 00/100
($16,275.00)
DOLLARS per month; and
(C)
During the balance of the Term of this Lease: TWO HUNDRED SIX
THOUSAND
ONE HUNDRED FIFTY AND 00/100 ($206,150.00) per annum - SEVENTEEN
THOUSAND ONE
HUNDRED SEVENTY NINE AND 17/100 ($17,179.17) DOLLARS per month.
The
"Rent Commencement Date" shall be the sixty-first day occurring
following the expiration of the "Rent Concession Period", in
accordance with the
provisions hereinafter set
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forth in Section 5.05 of this Lease, or as otherwise determined in
accordance
with said Section 5.05.
All
annual minimum rental payable under this Lease during the Term
hereof
shall be paid to the Landlord in advance, on the first day of each
calendar
month during the Term hereof at the office of Landlord or such
other place or to
such other person or party as Landlord may designate, without prior
demand
therefor and without any setoff or deduction whatsoever, except as
herein
provided. Annual minimum rent and additional rent shall be prorated
for a
fraction of a month, if any, based on the number of days within
such fractional
month. Unless and until otherwise designated by Landlord in writing
all annual
minimum rent and additional rent payable under this Lease shall be
paid to
National Realty & Development Corp., at 3 Manhattanville Road,
Purchase, New
York 10577.
Section 3.02. All taxes, charges, costs and expenses which Tenant
assumes
or agrees to pay under any provision of this Lease, together with
any and all
other sums and legal fees which may become due, by reason of any
default of
Tenant or failure on Tenant's part to comply with the provisions,
covenants and
conditions of this Lease on Tenant's part to be performed, and each
or any of
them, shall be collectible and recoverable as additional rent, and,
in the event
of nonpayment thereof, Landlord shall have all the rights and
remedies herein
provided as in the case of nonpayment of annual minimum rent.
ARTICLE 4. SUBORDINATION
Section 4.01. This Lease and all rights of Tenant hereunder are,
and shall
be, subject and subordinate to any mortgages, deeds of trust
(including blanket
mortgages or deeds of trust covering the Demised Premises and/or
the Center
and/or other properties) or any other security interest which has
been or which
hereinafter may affect the Demised Premises, and to any ground or
underlying
leases of all or part of the Center, and to any renewals,
modifications,
consolidations, replacements and extensions thereof (hereinafter
collectively
referred to as "Landlord's Financing"). Landlord represents that,
as of the date
hereof, the sole holder of Landlord's Financing is The Travelers
Life and
Annuity Company, One Tower Square, 2 SHS, Hartford, Connecticut
06183. Tenant
acknowledges that the interest of Landlord under this Lease may be
assigned by
Landlord as collateral security to any of the foregoing parties
holding
interests to which this Lease is subject and subordinate. In the
event of
foreclosure of any such interest, or termination of any such ground
of
underlying lease, or in the event of an exercise of the power of
sale under any
mortgage or other security interest made by Landlord covering the
premises of
which the Demised Premises forms a part, Tenant shall, at the sole
option and
direction of any such party, recognize the rights of any such party
under and
pursuant to the provisions of such collateral assignment and/or
attorn to and
recognize any purchaser at a foreclosure sale of any mortgage or
deed of trust
or any such purchaser at a sale exercised in connection with the
mortgagee's or
trustee's remedy of power of sale pursuant to any mortgage or deed
of trust
affecting the Demised Premises and/or Center or any transferee who
acquires the
Demised Premises and/or Center by deed in lieu of foreclosure, and
the
successors and/or assigns of such transferee or purchaser.
Notwithstanding
anything to the contrary contained herein, this Lease shall not be
subject and
subordinate to the lien of Landlord's Financing, unless an
instrument, duly
executed by the holder(s) of Landlord's Financing, shall be
delivered to Tenant
which instrument shall contain an agreement in substance, to be
effective only
so long as Tenant
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shall not be in default under the provisions of this Lease, that
such holder
shall recognize Tenant's rights under this Lease, shall not cut off
or terminate
this Lease through foreclosure of the documents securing Landlord's
Financing,
and Tenant shall not be disturbed in its possession of the Demised
Premises or
the exercise of any of its rights under the Lease, which agreement
may also
contains such provisions as are typically included therein by
commercial lenders
(such agreement hereinafter referred to as the "Subordination,
Non-Disturbance
and Attornment Agreement"). The Subordination, Non-Disturbance and
Attornment
Agreement shall be in recordable form and in substance reasonably
satisfactory
to Tenant, Landlord and the holder(s) of Landlord's Financing.
Tenant
acknowledges that the form annexed hereto as Exhibit D is
satisfactory to
Tenant.
Section 4.02. The provisions of Section 4.01 shall be
self-operative, but
Tenant covenants and agrees that it shall, within ten (10) days
following
request, at any time or times, execute, acknowledge and deliver to
Landlord any
instruments in order to subordinate this Lease and Tenant's rights
hereunder, as
aforesaid, said instruments to be in the form required by any
mortgagee, ground
lessor or other secured party.
Section 4.03. If Tenant shall fail or neglect to execute,
acknowledge and
deliver any documents required by this Article, Landlord, in
addition to any
other remedies, may, as agent or attorney-in-fact of Tenant,
execute,
acknowledge and deliver same on behalf of Tenant, and Tenant hereby
irrevocably
nominates, constitutes and appoints Landlord as Tenant's proper and
legal
attorney-in-fact for such purpose, hereby ratifying all such acts
that Landlord
may do as attorney-in-fact of Tenant.
Section 4.04. Tenant shall, at any time and from time to time, upon
not
less than ten (10) days prior notice, execute, acknowledge and
deliver to
Landlord a statement in writing certifying that this Lease is
unmodified and in
full force and effect (or, if there have been modifications, that
the same is in
full force and effect, as modified, and stating the modifications)
and the dates
to which the rent and other charges have been paid in advance, if
any, and
stating whether or not Landlord is in default in the performance of
any
provision, covenant or condition contained in this Lease, and if
so, specifying
each such default, and containing any other statements or
certifications
required by a mortgagee, and/or ground lessor and/or other secured
party, it
being intended that any statement or certification delivered
pursuant to this
Section may be relied upon by any party to whom it may be delivered
by Landlord.
Section 4.05. The ground and underlying leases and mortgages
referred to in
this Article 4 to which this Lease is subject and subordinate are
hereinafter
sometimes called "superior leases" and "superior mortgages",
respectively, and
the lessor of a superior lease, or its successor in interest at the
time, is
hereinafter sometimes called the "lessor" of such superior lease.
No pre-payment
of more than one month's rent shall be valid or binding upon the
holder of a
superior mortgage or the lessor of a superior lease unless
expressly approved in
writing by such holder or lessor or by any of its predecessors in
interest.
Section 4.06. Tenant agrees not to look to the mortgagee, as
mortgagee,
mortgagee in possession, or successor in title to the Demised
Premises and/or
the Center, for accountability for any security deposit required by
Landlord
hereunder, unless said sums have actually been received by said
mortgagee as
security for Tenant's performance of this Lease.
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ARTICLE 5. AS-IS; LANDLORD'S WORK; TENANT'S WORK
Section 5.01. Tenant has examined the Demised Premises and has made
a
complete inspection of same and is familiar with the physical
condition thereof.
Landlord has not made and does not make any representation as to
the physical
condition or any other matter affecting or relating to the Demised
Premises,
except as is in this Lease specifically set forth, and Tenant
specifically
acknowledges that no such representation has been made, except that
Landlord
represents, to the best of its knowledge and except as disclosed in
the Phase I
Environmental Assessment prepared by Environmental Management
Services dated
June 19, 2000, there are no environmental hazards present within
the Demised
Premises. Tenant further acknowledges that Landlord has afforded
Tenant the
opportunity for a full and complete investigation, examination, and
inspection
of the Demised Premises and Tenant agrees to accept the Demised
Premises "as
is", except that Tenant shall replace non-functioning horns,
strobes and
pullboxes in the Demised Premises, provided, however, Landlord
shall reimburse
Tenant for the one-half of the cost of replacing non-functioning
horns, strobes
and pullboxes in the Demised Premises (Landlord reimbursement not
to exceed
$3,000), subject to Landlord's receipt and approval of the
estimates for such
work, which approval shall not be unreasonably withheld or delayed,
and receipt
by Landlord of satisfactory documentation evidencing the payment
and lien-free
completion of such work.
Section 5.02. Landlord or Landlord's contractor may give Tenant
notice that
the Landlord's Work is substantially complete to the extent that it
is
practicable for Tenant to enter therein for the performance of work
by Tenant
necessary to occupy the Demised Premises and open for business, and
if such
notice shall be given, Tenant shall promptly thereafter commence
all work that
is necessary to open the Demised Premises for business. Subject to
the foregoing
provisions of this Section, Tenant shall have the right to install
its fixtures
and equipment during construction, provided Tenant does not
interfere with the
construction of the Demised Premises or Building, and, further,
provided, that
insurance meeting the requirements of Section 7.02 is furnished to
Landlord
prior to any such entry. Such entry into the Demised Premises by
Tenant prior to
the Commencement Date is and shall be at the Tenant's sole cost and
risk, and
the provisions of Section 7.01 and Section 7.02 shall be applicable
during any
such period prior to the Commencement Date. Prior to commencing any
work, Tenant
shall give Landlord prior written notice of the date on which
Tenant intends to
commence such work, which notice shall describe the type of labor
(i.e. union or
non-union labor) Tenant intends to hire for its work.
Notwithstanding anything
herein to the contrary, Landlord may require Tenant to use union
labor for all
work performed in the Demised Premises, the Building and/or in the
Center if, in
Landlord's reasonable judgment, the use of non-union labor would
delay or
interfere with the progress of any construction within the Building
and/or
Center and/or the operation of any business in the Building and/or
Center. In
the event that Landlord does not initially require Tenant to use
union labor and
a labor dispute subsequently arises due to Tenant's use of
non-union labor, then
Tenant shall, within twenty-four (24) hours following notice from
Landlord
(which may be oral or written), cause each conflicting labor to
leave the
Demised Premises, the Building and Center, and thereafter Tenant
shall prosecute
its work only with local union labor. All fixturing and/or other
work to be
performed by or on behalf of Tenant (other than Landlord's work
hereunder) shall
be done in accordance with plans and specifications therefor
submitted to and
approved by Landlord prior to the commencement of such fixturing
and/or other
work, which approval shall not be unreasonably withheld, and in
accordance with
and subject to the
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provisions of Article 19 hereof. No changes shall be made in said
plans and
specifications nor shall there be any deviation in the prosecution
of the work
in accordance with said plans and specifications without Landlord's
prior
written approval.
Section 5.03. If Tenant claims that some or all of the
construction
requirements imposed upon Landlord pursuant to the provisions of
this Lease have
not been complied with by Landlord upon delivery of notice of
substantial
completion of Landlord's Work, as provided herein, Tenant shall,
within ten (10)
days of said date (or ten days following the date Tenant opens for
the
transaction of business, whichever date is sooner), submit to
Landlord a written
list of the work Tenant claims remains to be performed by Landlord,
and Landlord
shall have ninety (90) days thereafter to complete such work. If
Landlord fails
to complete such work, the sole remedy of Tenant shall be to
complete such work
and Tenant shall have the right to set off the cost thereof from
the rent due
Landlord in order to reimburse Tenant for the cost and expense of
completion of
the work. Upon written request of Landlord, Tenant will, within
five (5) days
following request (but not sooner than the date required by the
first sentence
of this Section), furnish to Landlord a written statement that
Tenant is in
occupancy of the Demised Premises, that the construction of the
Demised Premises
has been completed in accordance with Landlord's obligations or in
lieu thereof,
a list of the work Tenant claims to be incomplete. Notwithstanding
the
foregoing, the aforesaid time period shall not be applicable to
latent defects
in the Landlord's Work for which notice may be given to Landlord
promptly
following the date upon which Tenant discovers, or reasonably could
have
discovered, any such latent defects. Landlord agrees to assign to
Tenant all
warranties relating to the Landlord's Work, provided, however, the
Landlord
reserves the right to enforce same, jointly with, or independently
of Tenant.
Section 5.04. Landlord shall substantially complete the
construction of the
Landlord's Work on or prior to that date which is one hundred
twenty (120) days
following the date of issuance of a building permit for the
Landlord's Work to
be performed at the Demised Premises.
If
possession of the substantially completed Demised Premises shall
not be
delivered to Tenant on or prior to such date, Tenant shall have the
right to
cancel this Lease upon notice to Landlord to be given within
fifteen (15) days
following such date, unless the substantially completed Demised
Premises shall
be delivered to Tenant prior thereto. If Tenant shall not exercise
such right of
cancellation, the date by which Landlord is obligated to deliver
possession of
the Demised Premises shall be deemed to be automatically extended
for an
additional period of ninety (90) days. If possession of the
substantially
completed Demised Premises is not delivered to Tenant prior to the
expiration of
such extension period, or if Tenant shall cancel this Lease
pursuant to the
first sentence of this paragraph, this Lease shall automatically
terminate and
be null and void and of no further force and effect, and the
parties shall be
mutually released of and from all rights and obligations hereunder.
Tenant's
right to cancel this Lease, as provided herein, shall be Tenant's
sole remedy
for Landlord's failure to deliver possession on or before the
required date.
If
the substantial completion of the Landlord's Work is delayed by
reason
of: (i) any act or omission of Tenant or any of its employees,
agents or
contractors; or (ii) any failure (not due to any act or omission of
Landlord or
any of its employees, agents or contractors) to plan or execute
Tenant's work
necessary for Tenant's occupancy of the Demised Premises with
reasonable speed
and diligence, or (iii) any changes by Tenant in the plans or
specifications for
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the construction of the Demised Premises or any changes or
substitutions
requested by Tenant; or (iv) Tenant's failure to furnish plans
and
specifications required to be furnished by Tenant, or subsequent
changes
thereto; or (v) Tenant's request for materials, finishes or
installations other
than Landlord's typical building standard; or (vi) the performance
or
incompletion of work by a party employed or retained by Tenant;
then the
Landlord's Work shall be deemed substantially completed on the date
when the
same would have been substantially completed but for such delay
and, in
addition, Tenant shall pay to Landlord all costs and damages which
Landlord may
sustain by reason of such delay.
Section 5.05.
(a) Tenant, at Tenant's sole cost and expense, subject to the
Tenant
Allowance (as hereinafter defined), shall perform all work
necessary to
renovate, fixture and equip the Demised Premises for Tenant's use
in accordance
with the provisions of Section 2.01 of this Lease (the "Tenant
Improvements").
Tenant covenants and agrees that Tenant shall commence the
performance of the
Tenant Improvements within fifteen (15) days following the issuance
of a
building permit, and thereafter Tenant shall diligently prosecute
such Tenant
Improvements and complete same as soon as possible, but in no event
more than
three (3) months from and after the date that the building permit
shall have
been issued ("Tenant Improvement Completion Date"). Tenant agrees
to apply for
the building permit immediately following Tenant's receipt of
notice from
Landlord that Landlord has approved the plans and specifications
for the
performance of the Tenant Improvements.
(b) Subject to completion of Tenant Improvements in accordance
with
Tenant's Plans (as hereinafter defined) and the provisions set
forth below in
this Section 5.05(B), Landlord shall reimburse Tenant for amounts
actually
expended by Tenant for a portion of the construction of the Tenant
Improvements,
in an amount not to exceed the sum of $217,000.00 (the "Tenant
Allowance"). Such
reimbursement shall be in the form of a credit to be taken by
Tenant against the
first payments of annual minimum rental payable hereunder. The
portion of the
Tenant Improvements for which the Tenant Allowance shall be paid
shall be only
that portion thereof that is office installation work (e.g.
partitioning, doors,
electrical, etc., including, without limitation, upgrading and
replacing of
existing mechanical systems in the Demised Premises) and in no
event shall the
Tenant Allowance be used for any work related to Tenant's trade
fixtures or
equipment (such portion of the Tenant Improvements for which Tenant
may receive
the Tenant Allowance is hereinafter called the "Tenant Allowance
Work").
Supplementing the foregoing, Landlord acknowledges and agrees that
the work
described in Exhibit E annexed hereto shall be deemed to be Tenant
Allowance
Work. Pending the completion of the Tenant Allowance Work (which
"completion"
shall be deemed to include the delivery to Landlord of the
documentation
required pursuant to Subparagraph (C) of this Section 5.05, the
annual minimum
rental payable pursuant to Section 3.01 of this Lease shall be
abated (the
period for which annual minimum rental is abated is referred to
herein as the
"Rent Concession Period"). Notwithstanding anything to the contrary
set forth
herein, in the event that the Tenant Improvements have not been
completed and
the documentation required pursuant to Subparagraph (C) of this
Section 5.05
have not been delivered to Landlord on or before the Tenant
Improvement
Completion Date, Tenant shall make immediate payment to Landlord of
any monthly
minimum rental payments that have been abated during the Rent
Concession Period,
the Rent Commencement Date shall be deemed to be the Commencement
Date of this
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<PAGE>
Lease and Tenant will immediately commence payment of annual
minimum rental
amounts as set forth in 3.01. Landlord shall be entitled to draw
upon the letter
of credit for the purpose of collecting such unpaid minimum rental
payments.
Notwithstanding the foregoing, in the event that the completion of
the Tenant
Improvements and the delivery to Landlord of the documentation
required pursuant
to Subparagraph (C) of this Section 5.05 has not occurred by the
Tenant
Improvement Completion Date by reason of the causes set forth in
Section 5.06
below, then the Tenant Improvement Completion Date shall be
extended for such
period of delay, but in no event shall any such delay extend for
more than an
additional three (3) months following the Tenant Improvement
Completion Date. It
is further acknowledged and agreed by Tenant that in the event that
the monies
expended by Tenant for the completion of the Tenant Allowance Work
are less than
the amount of the Tenant Allowance, Tenant shall not be entitled to
any credit
for the unused portion thereof, nor is Tenant entitled to any
additional sums
from Landlord in the event that the monies expended by Tenant in
connection with
the completion of the Tenant Allowance Work or the Tenant
Improvements exceeds
the amount of the Tenant Allowance.
(c) The Tenant Improvements shall be effected solely in
accordance
with the plans and specifications approved by Landlord (such plans
and
specifications hereinafter referred to as "Tenant's Plans"). The
Tenant
Improvements shall be performed in accordance with the foregoing
and the
following provisions of this Article 5:
1.
All work shall be done in a good and workmanlike manner.
2.
Tenant and its contractor and any subcontractor shall agree to
employ
only such labor as will not result in jurisdictional disputes or
strikes or
result in causing disharmony with other workers employed at the
Building. Tenant
will inform Landlord in writing of the names of any contractor or
subcontractor
Tenant proposes to use in the Demised Premises within a reasonable
time prior to
the beginning of work by such contractor or subcontractor. A copy
of any
contract or subcontract affecting Tenant Improvements, the Demised
Premises or
the Building shall be submitted to Landlord prior to commencement
of the work
provided for therein.
3.
The Tenant Improvements shall be effected in compliance with
all
applicable laws, ordinances, rules and regulations of governmental
bodies having
or asserting jurisdiction thereover and Tenant shall procure and
furnish to
Landlord copies of all governmental permits and authorizations
which may be
required in connection with such work, prior to the commencement
thereof.
4.
Tenant, at its expense, and with diligence and dispatch, shall
procure
the cancellation or discharge of all notices of violation arising
from or
otherwise connected with work performed or alleged to have been
performed by its
contractor(s) or subcontractor(s) and which shall be issued by the
Borough of
South Plainfield or any other public authority having or asserting
jurisdiction.
Tenant shall defend, indemnify and save harmless Landlord against
any and all
mechanic's and other liens and financing or title retention devices
filed in
connection therewith and against all costs, expenses and
liabilities (including
reasonable attorney's fees) incurred in connection with any such
lien, financing
statement, conditional bill of sale, chattel mortgage or other
financing or
title retention devices, or any action or proceeding brought
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<PAGE>
thereon. Tenant shall keep the Land, the Building and the Demised
Premises free
and clear of all liens for any work or material claimed to have
been furnished
to Tenant or to the Demised Premises on Tenant's behalf, and all
work to be
performed by Tenant shall be done in a manner which will not
interfere with or
disturb other tenants or occupants of the Building. All notices of
intention,
mechanic's liens, financing statements, conditional bills of sale,
chattel
mortgages and other financing or title retention devices filed
against Tenant,
the Demised Premises, or the Building for work claimed to have been
done for or
materials claimed to have been furnished to Tenant shall be
cancelled and
discharged of record by Tenant at its expense within ten (10) days
after such
filing, by payment or filing of the bond required by law.
Neither Tenant nor any of its agents, employees,
representatives,
contractors or subcontractors 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 or Landlord's interest in the Real Property;
and further,
Landlord shall have no responsibility to Tenant or to any
architect, engineer,
contractor, subcontractor, supplier, material man, workman or other
person, firm
or corporation who shall engage in or participate in the
performance of Tenant
Improvements, any additional work or any installation, alteration
or improvement
to be performed or made by Tenant under any of the terms of this
Lease, or
otherwise, unless Landlord shall expressly undertake such
obligation by an
agreement in writing, signed by Landlord, and made between Tenant
and Landlord
or such other party. 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 reversion or other estate or interest of
Landlord in and
to the Demised Premises, the Land and/or the Building. A copy of
the foregoing
provisions of this paragraph shall be included in any contract
entered into by
or on behalf of Tenant for the performance of or the furnishing or
installation
of Tenant Work, any additional work, or any installation,
alteration or
improvement to the Demised Premises.
5.
During the progress of the work to be done by Tenant, said work
shall be
subject to inspection by representatives of Landlord, which shall
be permitted
access and the opportunity to inspect at all reasonable times, but
this
provision shall not in any way whatsoever create any obligation on
Landlord to
conduct an inspection or impose any liability on Landlord for the
failure of any
such work.
6.
Prior to commencement of any Tenant Work, Tenant or Tenant's
contractor
shall furnish to Landlord policies of insurance or certificates
thereof
evidencing the existence of the insurance coverages required by
Section 7.02
hereof, including without limitation comprehensive general
liability and
builder's risk insurance. Upon request by Landlord, Tenant's
contractors and/or
subcontractors shall furnish to Landlord Performance Bonds and/or
Completion
Bonds, in form and substance reasonably satisfactory to
Landlord.
7.
Upon completion of the work, Tenant shall, at its sole cost and
expense,
remove all debris from the Demised Premises and the Building, and
clean the
same. If it is necessary for Landlord to do any work to clean the
Building
and/or the Center or any part thereof, Tenant shall reimburse
Landlord, upon
demand therefor, Landlord's cost of cleaning same, plus Landlord
supervision
charges of fifteen (15%) percent.
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<PAGE>
8.
Upon completion of Tenant Improvements, Tenant shall submit to
Landlord
in form and substance satisfactory to Landlord and counsel for
Landlord the
following:
(a)
A Certificate of Completion by a licensed architect or engineer,
which
Certificate shall certify that all Tenant Improvements has been
completed in
accordance with the approved plans and specifications;
(b)
A certificate by Tenant, or if Tenant is a corporation by an
executive
officer of Tenant, that the entire cost of Tenant Improvements has
been paid and
the amount thereof, that all those who furnished work or materials
have been
paid in full, and that no party has filed any lien or possesses any
claim which
is unpaid or remains undischarged;
(c)
A Certificate of Occupancy, or an equivalent permit or
certificate,
required by any governmental authorities prior to opening for
business within
the Demised Premises;
(d)
A final release and lien waiver signed by Tenant's general
contractor
and all subcontractors and materialmen, together with a certificate
by the
general contractor to the effect that all those who furnished work
or materials
to the Demised Premises have been paid in full and that the release
and waiver
has been signed by all those who furnished work or materials to the
Demised
Premises; and
(e)
Final and complete "as-built" plans (architectural and mechanical)
for
the Demised Premises.
Section 5.06. If there shall be a delay in the completion of the
Landlord's
Work or repair or restoration of the Demised Premises or Center or
any portion
thereof caused by strikes, riots, acts of God, shortages of labor
or materials,
national emergency, governmental restrictions, laws or regulations,
the act or
failure to act of Tenant, including without limitation, delays in
delivering
construction criteria and plan approval, or for any other cause or
causes beyond
Landlord's control, at Landlord's option such delay shall not be a
violation of
this Lease, and the time periods set forth in this Lease for any
such work
shall, at Landlord's option, be extended for a period of time equal
to the
period of delay.
Section 5.07. The Plot Plan shows the approximate location of
existing
buildings, buildings under construction, proposed buildings and
certain areas
reserved for related site improvements and future construction at
the option of
Landlord. Landlord shall have the right to develop the Center in
the manner it
sees fit and in the sole and absolute discretion of Landlord: to
construct or
not construct any buildings other than the Building, to change the
nature or
identity of the occupants of any such buildings, and to vary the
floor areas,
stories and heights, sizes, shapes and design of any such buildings
and the
divisions or portions thereof.
ARTICLE 6. ALTERATIONS AND REPAIRS
Section 6.01. No alterations or additions shall at any time be made
by or
at the instance of Tenant without Landlord's prior written consent,
except that
Tenant may make alterations, the cost or value of which is not
greater than
$10,000.00, without Landlord's consent, provided such alterations
do not affect
the exterior or load bearing structural integrity of the Building
or materially
or adversely affect the building systems serving the Demised
Premises. All work,
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<PAGE>
repairs, and/or alterations made by or at the instance of Tenant
shall be done
in a good and workmanlike manner, with first class materials, in
compliance with
any applicable governmental rules and regulations, and subject to
Article 19
hereof, and the cost thereof shall be paid by Tenant in cash or its
equivalent,
so that the Demised Premises shall at all times be free of liens
for labor or
materials supplied or claimed to have been supplied to the Demised
Premises. Any
alterations, installations, repairs, additions or improvements
(inclusive of
paneling and other wall coverings), except Tenant's trade fixtures,
shall, at
the option of Landlord, become the property of Landlord and shall
remain upon
and be surrendered with the Demised Premises, as part thereof, at
the expiration
or sooner termination of the Term. If Tenant is in default
hereunder or is
dispossessed, or vacates the premises, voluntarily or otherwise,
and fails to
remove any property, equipment and fixtures within ten (10) days
following
notice by Landlord, then and in that event, the said property,
equipment and
fixtures shall be deemed, at the option of Landlord, to be
abandoned; or in lieu
thereof, at the Landlord's option, Landlord may remove and store or
dispose of
such property and charge the cost and expense of removal, storage
and disposal
to Tenant, provided, however, Landlord's option to elect that such
alterations
either remain with the Demised Premises or be removed at the
Tenant's expense,
and the Landlord's determination as to whether any particular
fixtures are
"trade fixtures", shall be made within thirty days (30) following
Tenant's
written request to Landlord to make such determination with respect
to any
particular installation of any of such alterations or fixtures.
Trade fixtures
shall be defined as fixtures and equipment used by Tenant in the
operation of
its business, but not including any fixtures and equipment which
are part of the
operation of the Demised Premises or the Building.
Section 6.02. Anything to the contrary contained herein
notwithstanding, it
is expressly understood and agreed that Tenant may install, connect
and operate
such machinery, fixtures and equipment as may be deemed necessary
by the Tenant
for its business, subject to compliance with applicable rules and
regulations of
governmental bodies and bureaus having jurisdiction thereover.
Subject to the
terms and conditions of this Lease, the machinery, fixtures and
equipment
belonging to Tenant shall, at all times, be considered and intended
to be
personal property of Tenant, and not part of the realty, and
subject to removal
by Tenant, provided, at the time of such removal, that Tenant is
not in default
pursuant to any of the terms, covenants, provisions or conditions
of this Lease.
Tenant, at its own cost and expense, shall pay for any damage to
the Demised
Premises or Building caused by the installation thereof or such
removal, and
this obligation shall survive the expiration or sooner termination
of the Term.
Section 6.03. Landlord shall, following reasonable notice from
Tenant, make
all necessary repairs and replacements to the exterior structural
portions of
the Demised Premises, including the roof and foundations thereof,
provided,
however, Landlord shall not be required to make any repairs or
replacements
caused by any act, omission, or negligence of Tenant, any
subtenant, or
concessionaire, or their respective employees, agents, invitees,
licensees or
contractors, including any repairs to the roof necessitated by roof
penetrations
made by Tenant, it being understood that Landlord shall be
responsible for any
roof repairs arising out of Landlord's Work. Tenant shall make all
other repairs
and replacements to the Demised Premises. Tenant shall maintain
throughout the
Term, including any extension term hereof, a protective service
maintenance
contract with a contractor approved by Landlord, which approval
shall not be
unreasonably withheld, providing for periodic maintenance of the
H.V.A.C. system
serving the Demised Premises, including without limitation periodic
changing of
any and all filters, changing of belts, lubricating of equipment
and maintenance
of operating levels of freon in
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<PAGE>
accordance with manufacturers specifications. Said contract shall
provide for
maintenance inspection and service not less than two (2) times per
year. A copy
of any such maintenance contract shall be delivered to Landlord on
a yearly
basis or more often if required by Landlord. Tenant shall keep all
glass clean
and in good condition, and Tenant shall replace any glass which may
be damaged
or broken with glass of the same quality. Tenant shall keep the
sidewalk, if
any, adjacent to the Demised Premises free and clear of trash,
litter and
rubbish.
Section 6.04. To the extent permitted by law, nothing contained in
this
Lease shall authorize Tenant to do any act which may create or be
the foundation
for any lien, mortgage or other encumbrance upon the reversion or
other estate
of Landlord, or of any interest of Landlord in the Demised
Premises, or upon or
in the Building or Center of which the same form a part; it being
agreed that
should Tenant cause any alterations, changes, additions,
installations,
improvements or repairs to be made to the Demised Premises, or
cause materials
to be furnished or labor to be performed therein or thereon,
neither Landlord
nor the Demised Premises shall, under any circumstances, be liable
for the
payment of any expense incurred or for the value of any work done
or materials
furnished to the Demised Premises or any part thereof. Tenant
shall, upon
request of Landlord, deliver such documents as may be required by
Landlord in
order to effectuate the lien protection required by this paragraph
and Section
6.01 hereof, including without limitation, waivers of lien in
advance from all
contractors. All such alterations, changes, additions,
improvements, repairs,
materials and labor shall be at Tenant's sole expense and Tenant
shall be solely
and wholly responsible to contractors, subcontractors, laborers and
materialmen
furnishing labor and material to the Demised Premises and Building
or any part
thereof. If, because of any act or omission of Tenant, any
mechanic's or other
lien or order for the payment of money shall be filed against the
Demised
Premises or the Building or improvements thereon or therein, or
upon the Center,
or against Landlord (whether or not such lien or order is valid or
enforceable
as such), Tenant shall, at Tenant's own cost and expense, within
ten (10) days
after notice of the filing thereof, cause the same to be canceled
and discharged
of record, or furnish Landlord with a surety bond issued by a
surety company
reasonably satisfactory to Landlord, protecting Landlord from any
loss because
of nonpayment of such lien or claim, and Tenant hereby indemnifies
and saves
harmless Landlord from and against any and all costs, expenses,
claims, losses
or damages, including reasonable counsel fees, resulting therefrom
or by reason
thereof.
Section 6.05. Except for the repair obligations of Landlord under
Section
6.03 above and the restoration obligations of Landlord under and as
set forth in
Articles 8 and 10 hereof, the Tenant shall take good care of the
Demised
Premises and, at its cost and expense, keep and maintain in good
repair the
interior and exterior of the Demised Premises, including, but not
limited to the
air conditioning and heating plant, the plumbing pipes and fixtures
belonging
thereto; and shall repair or replace all mechanical and working
parts used in
connection with the air conditioning, electrical, heating and
plumbing plants,
fixtures and systems; and shall keep the water and sewer pipes and
connections,
including the gutters, leaders, and roof drains, free from other
obstructions;
and shall generally maintain and repair the interior and exterior
of the Demised
Premises and shall, at the end or the expiration of the Term (or
Extension Term,
whichever is applicable), deliver up the Demised Premises in good
order and
condition, damages by the elements, ordinary wear and tear
excepted. Tenant
covenants and agrees that it shall not cause or permit any waste
(other than
reasonable wear and tear), damage or disfigurement to the Demised
Premises, or
any overloading of the floors of the Building.
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<PAGE>
Section 6.06. Landlord hereby acknowledges that Tenant may obtain
financing
for its laboratory and/or office equipment, and that in such event,
Tenant may
grant a security interest to such lender or equipment lessor in
connection with
such financing and/or leasing. Landlord further acknowledges that
such financing
or leasing by Tenant shall not be deemed to be a violation of the
provisions of
Section 6.04 so long as the lien of such lender or equipment lessor
extends
solely to the trade fixtures or other property of the Tenant
located at the
Demised Premises, and does not attach to, affect in any manner
whatsoever, the
building or property of the Landlord located at the Building,
including, without
limitation, the building fixtures and equipment located in the
Demised Premises.
ARTICLE 7. INDEMNITY AND INSURANCE
Section 7.01.
(a) To the extent not covered by the insurance required to be
maintained by Landlord hereunder, Tenant hereby indemnifies and
saves harmless
Landlord from and against any claims and all loss, cost, liability,
damage
and/or expense, including, but not limited to reasonable counsel
fees, penalties
and fines, incurred in connection with or arising from (i) any
default by Tenant
in the observance or performance of any of the provisions,
covenants or
conditions of this Lease on Tenant's part to be observed or
performed, (ii) the
use or occupancy or manner of use or occupancy of the Demised
Premises by Tenant
or any person claiming through or under Tenant, or (iii) any acts,
omissions, or
negligence of Tenant or any such person, or any contractor, agent,
servant,
employee, visitor or licensee of Tenant, or any such person, in or
about the
Demised Premises. If any action or proceeding shall be brought
against Landlord
based upon any such claim, Tenant, upon notice from Landlord, shall
cause such
action or proceeding to be defended, at Tenant's expense, by
counsel acting for
Tenant's insurance carriers in connection with such defense or by
other counsel
reasonably satisfactory to Landlord.
(b) To the extent not covered by insurance required to be
maintained
by Tenant hereunder, Landlord hereby indemnifies and saves harmless
Tenant from
and against any claims and all loss, cost, liability, damage and/or
expense,
including, but not limited to reasonable counsel fees, penalties
and fines,
incurred in connection with or arising from (i) any default by
Landlord in the
observance or performance of any of the provisions, covenants or
conditions of
this Lease on Landlord's part to be observed or performed, or (ii)
any acts,
omissions, or negligence of Landlord or any such person, or any
contractor,
agent, servant, employee, visitor or licensee of Landlord, or any
such person,
in or about the Demised Premises. If any action or proceeding shall
be brought
against Tenant based upon any such claim, Landlord, upon notice
from Tenant,
shall cause such action or proceeding to be defended, at Landlord's
expense, by
counsel acting for Landlord's insurance carriers in connection with
such defense
or by other counsel reasonably satisfactory to Tenant.
Section 7.02. Tenant shall, during the Term (including any
extension term)
and during any period prior to the commencement of the Term during
which Tenant
or anyone acting by or on behalf of Tenant enters the Demised
Premises, at
Tenant's own cost and expense, maintain and provide: (a)
comprehensive general
liability insurance for the benefit and protection of Landlord and
Tenant (said
policy to name Landlord, ground lessor, if any, and any other
parties designated
by Landlord, as co-insureds) in an amount not less than $1,000,000
for injuries
or
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<PAGE>
death to any one person, and not less than $3,000,000 for injuries
or death to
more than one person in any one accident or occurrence and for
damage to
property in an amount not less than $500,000 arising out of any one
accident or
occurrence; (b) plate glass insurance covering all plate glass in
the Demised
Premises; (c) worker's compensation insurance covering all persons
employed in
connection with Tenant's use and occupancy of the Demised Premises
or any
construction or alteration work therein; (d) insurance against loss
or damage to
Tenant's contents, including without limitation, trade fixtures and
equipment,
by fire, lightning, and other risks from time to time included
under standard
"extended coverage" policies, and vandalism and malicious mischief,
in amounts
sufficient to prevent Landlord and Tenant from becoming co-insurers
of any loss
under such policy, but in any event, not less than 100 percent of
the full
insurable value of such property; (e) boiler and pressure vessel
insurance on
all of Tenant's equipment, parts thereof and appurtenances attached
or connected
to the Demised Premises which by reason of their use or existence
are capable of
bursting, erupting, collapsing or exploding, in the minimum amount
of Five
Hundred Thousand ($500,000.00) Dollars for damage to property
resulting from
such perils; and (f) insurance covering such other risks as may be
reasonably
requested by Landlord occasioned by or attributable to the use or
occupancy or
manner of use or occupancy of the Demised Premises by Tenant. Said
policies
shall be issued by companies satisfactory to Landlord and licensed
to do
business in the state in which the Demised Premises is located.
Said policies or
certificates thereof shall be delivered to Landlord at the
commencement of the
Term (or prior thereto in the event of earlier entry by Tenant upon
the Demised
Premises), together with proof of payment of premium therefor, and
renewal
policies or certificates therefor shall be delivered to Landlord
not less than
twenty (20) days prior to the expiration dates thereof. Said
policies and/or
certificates shall contain an undertaking by the insurer to give
Landlord not
less than twenty (20) days written notice of any cancellation or
change in scope
or amount of coverage of said policies.
Section 7.03.
(a) Landlord shall, during the Term, maintain and provide
general
hazard insurance during the course of construction (including
"builder's risk
endorsements") against loss or damage to the Building by fire,
lightning and
other risks from time to time included under standard "Extended
Coverage"
policies, vandalism and malicious mischief, in amounts not less
than 100 percent
of the full replacement value of the Building and any other
building or portion
thereof covered by such insurance and rent loss insurance covering
all minimum
and additional rental payable hereunder. Tenant shall pay its
proportionate
share of the cost of maintaining and providing such insurance,
which
proportionate share shall be a fraction having as its numerator the
number of
square feet of floor area within the Demised Premises and as its
denominator,
the total number of square feet of floor area of all buildings
within Lot 46.24.
(b) Such payment shall be made to Landlord, at Landlord's
Option,
either annually within thirty (30) days of demand therefor or in
monthly
installments on or before the first day of each calendar month, in
advance, in
an amount estimated by Landlord. Periodically, Landlord shall
furnish Tenant
with a written statement of the actual amount of Tenant's
proportionate share of
said insurance costs. If the total amount paid by Tenant under this
section for
any period during the Lease Term shall be less than the actual
amount due from
Tenant for such period, as shown on such statement, Tenant shall
pay to Landlord
the difference between the amount paid by Tenant and the actual
amount due, such
deficiency to be paid within ten (10)
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<PAGE>
days after demand therefor by Landlord; and if the total amount
paid by Tenant
hereunder for any such period shall exceed the actual amount due
from Tenant for
such period, the excess shall promptly be applied by Landlord to
the next
accruing monthly installments thereof or, at Landlord's option, to
any other
charges payable by Tenant. For the calendar years in which this
Lease commences
and terminates, the provisions of this section shall apply and
Tenant's
liability for its proportionate share thereof for such years shall
be subject to
a pro rata adjustment based on the number of days of said calendar
years during
the Lease Term. Prior to or at the commencement of the Lease Term
and from time
to time thereafter throughout the Lease Term, Landlord will notify
Tenant in
writing of Landlord's estimate of Tenant's monthly installments due
hereunder.
Tenant's obligations under this section shall survive the
expiration of the
Lease Term.
Section 7.04. Insurance coverages required of Tenant hereunder
shall be
reviewed on an annual basis and Landlord may require that said
coverages shall
be updated in accordance with the provisions hereinabove set forth
as to amounts
and scope of coverage.
Section 7.05. In the event of any insured loss covered under the
terms and
conditions of this Lease, and for which Tenant is obligated to
maintain
insurance coverage, all insurance carriers' checks in satisfaction
of the same
shall be made payable to the Landlord and the holder of the first
mortgage
covering the Building and Tenant waives any and all rights to be
designated a
payee on such loss payment, except as to losses under the coverage
in Section
7.02(d) above.
ARTICLE 8. FIRE DAMAGE
Section 8.01. If the Demised Premises shall be partially damaged by
fire or
other insured casualty, the damages shall be repaired by and at the
expense of
Landlord and the annual minimum rental until such repairs shall be
made shall
abate equitably according to the part of the Demised Premises which
is unusable
by Tenant or, if by reason thereof, the Demised Premises are
rendered
untenantable, said rental shall totally abate until such repairs
shall be made.
Notwithstanding the foregoing, if the Demised Premises or the
Building shall be
damaged to such extent that Landlord shall decide to demolish same,
or not to
rebuild same, then, and in such event, Landlord may terminate this
Lease upon
notice to Tenant given within ninety (90) days following such
event, and upon
the date specified in such notice, which date shall not be less
than thirty (30)
days nor more than sixty (60) days following the giving of said
notice, this
Lease shall terminate and Tenant shall vacate and surrender the
Demised Premises
to Landlord. Any annual minimum rental prepaid by Tenant beyond
said date shall
be promptly refunded to Tenant. Notwithstanding any of the
foregoing provisions
of this Article, if Landlord or the holder of any superior mortgage
shall be
unable to collect all of the insurance proceeds (including rent
insurance
proceeds) applicable to damage or destruction of the Demised
Premises or the
Building by fire or other cause, by reason of some action or
inaction on the
part of the Tenant or any of its employees, agents or contractors,
then, without
prejudice to any other remedies which may be available against
Tenant, the
abatement of Tenant's rents provided for in this Article shall not
be effective
to the extent of the uncollected insurance proceeds.
Section 8.02. If this Lease shall not be terminated as provided
above in
this Article, Landlord shall, at its expense, proceed with the
restoration of
the Demised Premises, provided, Landlord's obligations hereunder
shall not
exceed the scope of Landlord's initial construction
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obligations under this Lease and further provided, that Landlord's
restoration
obligations shall be subject to building and zoning laws then in
effect. No
penalty shall accrue for reasonable delay which may arise by reason
of
adjustment of insurance on the part of Landlord. Landlord shall use
diligent
efforts to adjust insurance promptly. If Landlord shall so restore
the Demised
Premises, Tenant shall repair, restore and redecorate the Demised
Premises and
reoccupy and reopen the Demised Premises, within fifteen (15) days
following
notice of restoration, in a manner and to the condition existing
prior to the
event of damage, except to the extent that Landlord is obligated
above, and
Tenant shall hold in trust the proceeds of all insurance carried by
Tenant on
its property for the purpose of such repair and restoration.
Section 8.03. Nothing hereinabove contained with respect to
Tenant's right
to abate the rent under proper conditions shall be construed to
limit or affect
Landlord's right to payment under the rental loss coverage to be
provided
pursuant to Section 7.03 hereof.
ARTICLE 9. WAIVER OF SUBROGATION
Section 9.01. Landlord, its officers, agents, employees,
subsidiaries and
affiliated entities and corporations shall not be liable for any
damage to or
destruction of any of Tenant's goods, merchandise, fixtures,
furniture or
property of whatsoever nature, caused by fire or any other cause
whatsoever,
including, without limitation, the negligence of any such parties,
and Tenant
hereby releases and waives any right of recovery against Landlord,
its officers,
agents, employees, subsidiaries and affiliated entities and
corporations for any
such loss. Tenant shall procure a waiver of subrogation on the part
of the
insurer against such parties by an endorsement to all insurance
policies whereby
the insurer recognizes the provisions of this Article.
Section 9.02. Tenant, its officers, agents, employees, subsidiaries
and
affiliated entities and corporations shall not be liable for any
damage to or
destruction of any of Landlord's goods, merchandise, fixtures,
furniture or
property of whatsoever nature, caused by fire or any other cause
whatsoever,
including, without limitation, the negligence of any such parties,
and Landlord
hereby releases and waives any right of recovery against Tenant,
its officers,
agents, employees, subsidiaries and affiliated entities and
corporations for any
such loss. Landlord shall procure a waiver of subrogation on the
part of the
insurer against such parties by an endorsement to all insurance
policies whereby
the insurer recognizes the provisions of this Article.
ARTICLE 10. CONDEMNATION
Section 10.01. If the whole of the Demised Premises shall be taken
by any
governmental authority under the power of condemnation, eminent
domain, or
expropriation, or in the event of a conveyance in lieu thereof, the
Term shall
cease as of the day possession shall be taken by such governmental
authority. If
more than 25 percent of the Demised Premises shall be so taken or
conveyed,
either Landlord or Tenant shall have the right to terminate this
Lease upon
notice to the other party, effective as of the day possession shall
be taken by
such governmental authority. If this Lease is so terminated, annual
minimum
rental shall be prorated as of the date that possession must be
surrendered to
the condemning authority.
Section 10.02. If this Lease continues after a partial taking, the
annual
minimum rental shall abate equitably as to the part of the Demised
Premises
which is taken. If this Lease
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continues after any such taking or conveyance, Landlord shall make
all necessary
repairs and restorations so as to restore the remainder of the
Demised Premises
to a complete architectural unit. Landlord's reconstruction
obligations shall
not exceed the amount of the award or compensation for the taking,
shall not
exceed the scope of Landlord's initial construction obligations
hereunder, and
shall be subject to building and zoning laws then in effect.
Section 10.03. If so much of the Center, Common Areas or Building
shall be
so taken or conveyed so that in the reasonable exercise of
Landlord's judgment,
the continued operation of the Building for use by its tenants is
unfeasible,
then, in such event, Landlord may, by notice to Tenant, delivered
not later than
thirty (30) days following the date that possession of the premises
taken or
conveyed is delivered to the governmental authority, terminate this
Lease, and
rent shall be pro rated as of the date that possession must be
surrendered to
the condemning authority.
Section 10.04. Tenant and not Landlord shall be entitled to any
portion of
the award made to Tenant for the value of Tenant's removable trade
fixtures and
equipment other than equipment necessary for the operation of the
Building. All
compensation awarded for the taking of the Building, the fee and
the leasehold
shall belong to and be the property of Landlord, and Tenant shall
not be
entitled to and hereby waives any damages for the unexpired portion
of the Term,
or injury to its leasehold interest.
ARTICLE 11. ASSIGNMENT AND SUBLETTING
Section 11.01. Tenant, for itself, its heirs, distributees,
executors,
administrators, legal representatives, successors and assigns, as
the case may
be, expressly covenants that it shall not assign, mortgage or
encumber this
agreement, nor sublet or underlet nor suffer or permit the Demised
Premises or
any part thereof to be used by others without the prior written
consent of
Landlord in each instance. If, with consent of Landlord, this Lease
may be
assigned, or the Demised Premises or any part thereof be underlet
or occupied by
anybody other than Tenant, Landlord may collect rent from the
assignee,
undertenant or occupant and apply the amount collected to the rent
herein
reserved, but no such assignment, underletting, occupancy or
collecting shall be
deemed to relieve Tenant or any guarantor of this Lease or
guarantor of the
obligations of Tenant hereunder of any of its or their obligations
hereunder nor
be deemed a waiver of this covenant, or the acceptance of the
assignee,
undertenant or occupant as tenant; or a release of Tenant or any
guarantor of
this Lease or any guarantor of the obligations of Tenant hereunder
from its or
their obligations under the covenants, provisions and conditions
hereof; it
being understood and agreed that Tenant and any guarantor of this
Lease or any
guarantor of the obligations of Tenant hereunder shall at all
times, including
during any extension term, remain obligated as primary obligors
under this
Lease. The consent by Landlord to an assignment or underletting
shall not in any
wise be construed to relieve Tenant or any other Tenant, assignee,
undertenant,
or occupant of the Demised Premises from obtaining the express
consent in
writing of Landlord to any further assignment or underletting, and
no such
assignment or subletting shall be made to anyone who shall occupy
the Demised
Premises for any use other than as specifically permitted by the
terms of this
Lease. Notwithstanding anything contained in this Lease to the
contrary, in the
event that it shall be found by a court of competent jurisdiction
that Landlord
was unreasonable in withholding its consent to the assignment of
this Lease or
the subletting of all or any portion of the Demised Premises,
Tenant's sole
remedy shall be limited to specific
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performance and Tenant shall not be entitled to damages or any
other affirmative
relief or remedy as a result thereof. In the event of a leveraged
buy-out or
other take-over of Tenant, Landlord's consent to an assignment of
this Lease or
subletting of the Demised Premises to the successor entity shall
not be deemed
to have been unreasonably withheld if said successor entity shall
not have a net
worth (in the event of a corporate entity, on a market value basis)
as certified
to by a certified public accountant at least equal to the net worth
of Tenant
upon the date of execution of this Lease.
Section 11.02. Supplementing the provisions of Section 11.01 of
this Lease,
provided Tenant is not in default under any of the terms,
covenants, conditions
and provisions of the Lease, Landlord shall not unreasonably
withhold or delay
or condition its consent to any proposed assignment of this Lease,
or subletting
of all or any portion(s) of Demised Premises. Any assignment or
transfer of this
Lease and any subletting of all or a portion of the Demised
Premises shall be
subject to Landlord's prior written consent and subject to the
terms of all of
the sections of this Article 11 and shall be made only if, and
shall not be
effective until, the assignee or subtenant shall execute,
acknowledge and
deliver to Landlord a recordable agreement, in form and substance
satisfactory
to Landlord and counsel for Landlord, whereby the assignee or
subtenant shall
assume for the benefit of Landlord the obligations and performance
of this Lease
and agree to be personally bound by and upon all of the covenants,
agreements,
terms, provisions and conditions hereof on the part of Tenant to be
performed or
observed, and whereby Tenant (and any guarantor of this Lease or of
the Tenant's
obligations hereunder) covenants and agrees to remain liable as a
primary
obligor for the due performance of all of the covenants,
agreements, terms,
provisions and conditions of this Lease on the part of Tenant to be
performed or
observed. In the event of any assignment of this Lease or any
subletting of all
or any portion of the Demised Premises, the obligations of Tenant
and any
guarantor of this Lease or any guarantor of the obligations of
Tenant under this
Lease as a primary obligor shall be unaffected and shall remain in
full force
and effect.
Section 11.03. In the event that Tenant desires to assign this
Lease or
sublet all or a portion of the Demised Premises, Tenant shall first
notify
Landlord in writing of its intention, and such notice shall include
the
information described in the last sentence of Section 11.04 hereof
and state the
name of the proposed assignee or subtenant, together with its full
address and a
description of its proposed use (but nothing contained herein shall
permit, nor
obligate Landlord to permit, a use other than the use permitted by
Section 2.01
of this Lease, it being understood that any change in use shall be
subject to
Landlord's consent, which Tenant agrees may, notwithstanding
anything contained
herein to the contrary, be unreasonably withheld). Tenant shall
include
therewith such financial information as may be available concerning
the proposed
assignee or subtenant, including without limitation current updated
financial
statements (which financial information Tenant, and/or the proposed
assignee or
subtenant shall supplement on demand if required by Landlord). In
addition,
Tenant shall simultaneously tender a duplicate original of the
instrument of
assignment or sublease and a termination and surrender agreement in
proper form,
reasonably satisfactory to counsel for Landlord ("Surrender
Agreement") executed
in and on behalf of Tenant. Thereafter, Landlord shall have sixty
(60) days in
which to decide whether to accept a surrender of the Demised
Premises or to
respond to the notification above, it being understood that during
such sixty
(60) day period Landlord shall have the right to negotiate with
such assignee
and/or subtenant, without Landlord incurring any obligation
whatsoever to
Tenant, for all or a portion of the Demised Premises or such other
or greater or
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lesser area of the Center as Landlord shall determine in its sole
discretion. In
the event that Landlord shall accept the Surrender Agreement,
Landlord shall
execute the Surrender Agreement and this Lease shall terminate as
of the
sixtieth day following the day that Landlord received Tenant's
notification
("Surrender Date"), with the same force and effect as if such date
were the
Expiration Date. Upon the termination of this Lease pursuant
hereto, Tenant
shall pay all annual minimum rent and additional rent on a pro rata
basis for
each day prior to the Surrender Date. In the event that any item of
additional
rent cannot be calculated as of the Surrender Date, Tenant hereby
covenants to
pay its pro rata share promptly upon being billed therefor and this
obligation
shall survive the Surrender Date.
Section 11.04. Tenant hereby covenants and agrees to tender to
Landlord
upon receipt fifty (50%) percent of any annual minimum rent or
additional rent
or lump sum or installment payment or sum which Tenant shall
receive from or on
behalf of any assignee(s) or subtenant(s) or any occupant by,
through or under
Tenant, which is in excess of the annual minimum rent or additional
rent payable
by Tenant in accordance with the provisions of this Lease (or in
the event of a
subletting of less than the whole of the Demised Premises, the
annual minimum
rent or additional rent allocable to that portion of the Demised
Premises
affected by such sublease) less the actual bona-fide expenses paid
by Tenant in
connection with such subletting or assignment (e.g. cost of
alterations, and
brokerage, legal and architectural and engineering fees). At the
time of
submission of the proposed assignment or sublease to Landlord,
Tenant shall
certify to Landlord in writing whether or not the assignee or
subtenant has
agreed to pay any such monies to Tenant or any designee of Tenant
other than as
specified and set forth in such instruments, and if so Tenant shall
certify the
amounts and time of payment thereof in reasonable detail.
Section 11.05. Notwithstanding anything to the contrary contained
in this
Article, Tenant may assign this Lease or sublet any portion of the
Demised
Premises at any time during the term of this lease, without
obtaining Landlord's
consent, upon Tenant giving Landlord prior written notice, to (a)
another
corporation succeeding to substantially all of the assets of Tenant
as a result
of a consolidation or merger or to a corporation to which all or
substantially
all of the assets of Tenant have been sold; (b) a wholly-owned
subsidiary
corporation; or (c) an affiliated corporation (defined as any
corporation whose
majority of shares are owned or controlled by the same persons
owning or
controlling the majority of shares of Tenant); provided: (i)
documentation in
compliance with Section 11.02 above shall be delivered to Landlord
prior to the
effective date of such assignment or sublease, and (ii) Tenant
shall remain
primarily liable under all terms and conditions of this Lease
(unless Tenant's
corporate existence ends as a matter of law pursuant to such
consolidation or
merger).
ARTICLE 12. COMMON AREA MAINTENANCE
Section 12.01. As used in this Lease, the term "Common Area
Operating
Costs" shall include the total cost and expense incurred by
Landlord in
operating, lighting, striping, maintaining, cleaning, landscaping,
repairing
(including replacement and resurfacing) managing, signing,
equipping and
insuring the Common Areas within Lot Nos. 46.24 and 46.25 plus ten
(10%) percent
of the foregoing costs to cover Landlord's administrative and
overhead costs.
Such costs and expenses shall include, without limitation
(including appropriate
reserves): cleaning; fire and police protection and general
security (Landlord
not incurring or assuming any obligation to provide such protection
or security
or any liability for the failure of the same);
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repairing and replacing paving; keeping the Common Areas
supervised, drained,
reasonably free of snow, ice, rubbish and other obstructions, and
in a neat,
clean, orderly and sanitary condition; the charges for rubbish
containers and
removal (except that at Landlord's option, Tenant shall be directly
responsible
for contracting for and for providing (subject to Landlord's
approval of the
provisions and conditions of the agreement therefor) rubbish
containers and
removal); the maintenance of any and all fire protection systems
servicing Lot
Nos. 46.24 and 46.25; the cost of public liability insurance;
keeping the Common
Areas suitably lighted; maintaining signs (other than Tenant's
signs), markers,
painted lines delineating parking spaces, and other means and
methods of
pedestrian and vehicular traffic control; constructing,
maintaining
