Exhibit 10.4
L E A S E
A G R E E M
E N T
BY AND BETWEEN:
EASTPARK AT 8A
“Landlord”
- and -
LINGUAGEN CORP.
“Tenant”
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PREMISES:
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2005 Eastpark Boulevard
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Cranbury, New Jersey 08512
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DATED: December 9,
2002
AGREEMENT, made December 9, 2002,
between Eastpark at 8A, a general partnership, 1000 Eastpark
Boulevard, Cranbury, New Jersey 08512, “Landlord”; and
Linguagen, Corp., 215 College Road, Paramus, New Jersey 07652,
“Tenant”.
W I T N E S
S E T H :
WHEREAS, the Landlord intends to
lease to the Tenant the suite at 2005 Eastpark Boulevard, Cranbury,
New Jersey 08512 (“Building”), constituting a portion
of the office/industrial park known as Eastpark at 8A
(“Office Park”); and
WHEREAS, the parties hereto wish to
mutually define their rights, duties, and obligations in connection
with the Lease.
NOW, THEREFORE, in consideration of
the promises set forth herein, the Landlord leases unto the Tenant
and the Tenant rents from the Landlord the leased premises
described in Paragraph 1, and the Landlord and Tenant do hereby
mutually covenant and agree as follows:
1.
LEASED PREMISES
The leased premises shall consist of
5,100 rentable square feet of office and laboratory space
(“Leased Premises”) as measured from outside of
exterior walls to center line of common walls, together with all
existing improvements, and all easements, tenements, appurtenances,
hereditaments, rights and privileges appurtenant thereto, and any
and all fixtures and equipment which have been installed in the
Building by the Landlord for the use of the Tenant in its occupancy
of the Leased Premises. Tenant shall also have the right to use all
common areas of the Office Park in a similar manner as other Office
Park tenants. Tenant shall have the right of 24 hours per day, 365
days per year access to the Leased Premises, Office Park, and
parking areas.
2.
TERM OF LEASE
The term of the Lease shall be five
years, to commence on the later of (a) December 1 , 2002,
and (b) the issuance of a C.C.O. (“Commencement Date”),
and to end on the last day of the month in which occurs the fifth
(5 th ) anniversary of the Commencement
Date.
Initial: Landlord
Tenant
Lease Version Date:
11-22-02
3.
TENANT
IMPROVEMENTS
3.1 The Tenant
shall accept the Leased Premises in its existing condition, subject
to Landlord painting the interior walls and replacing the carpet
with new commercial grade carpeting in a complementary color to the
walls.
3.2 To the extent
installed by Tenant, Tenant shall be responsible for the design and
installation of its own phone, data, communication, fire alarm, and
security systems.
3.3 All mechanical
units and equipment provided as a part of the Leased Premises shall
be in operating condition at the Commencement Date.
4.
RENT
4.1 Tenant shall
pay, as rent for the Leased Premises, an annual base rent per
square foot of $32.00, for an aggregate annual base rent of
$163,200.00 (“Base Rent”), payable monthly in the sum
of $13,600.00. The annual Base Rent shall be payable in advance in
equal monthly installments on the first day of each calendar
month.
4.2 Tenant shall
pay the following, which shall be referred to herein as
“Additional Rent”;
(a)
A fee per square foot for the Common
Area Expenses (as hereafter defined) and real estate taxes;
and
(b)
Any other charges as provided in
this Lease. The Base Rent and Additional Rent shall be referred to
hereafter as “Rent.”
4.3 Tenant
covenants to pay the Rent in lawful money of the United States
which shall be legal tender for the payment of all debts, public
and private, at the time of payment. Such Rent shall be paid to
Landlord at its office address hereinabove set forth, or at such
other place as Landlord may, from time to time, designate by notice
to Tenant.
4.4 The Rent shall
be payable by Tenant without any set-off or deduction of any kind
or nature whatsoever and without notice or demand. The sum of all
increases required to be paid as Additional Rent or Base Rent in
accordance with this Lease, shall be paid to Landlord within ten
(10) days following the giving of notice hereof by Landlord of such
increases.
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5.
PARKING AND USE OF EXTERIOR
AREA
The Tenant shall have the right to
use parking spaces on a non-exclusive basis in common with other
tenants of the Building. Landlord reserves the right to allocate
specific parking spaces if it chooses, but at all times Tenant
shall have reasonably sufficient parking available for its use. The
Landlord and Tenant mutually agree that they will not block, hinder
or otherwise obstruct the access driveways and parking areas so as
to impede the free flow of vehicular traffic on the property. In
connection with the use of the loading platforms, if any, Tenant
agrees that it will not use the same so as to unreasonably
interfere with the use of the access driveways and parking areas.
Tenant shall not store trailers or other vehicles on any portion of
the access driveways or parking areas, and may not utilize any
portion of the land or Building outside of the Leased Premises for
any purpose unless consented to in advance by Landlord.
6.
USE
The Tenant covenants and agrees to
use and occupy the Leased Premises only as an office and
laboratory, which use is expressly subject to all applicable zoning
ordinances, rules and regulations of any governmental
instrumentalities, boards or bureaus having jurisdiction thereof.
Tenant’s use of the Leased Premises shall not interfere with
the peaceable and quiet use and enjoyment by other tenants at their
respective leased premises located at the Building or in the Office
Park, nor shall Tenant’s activities cause Landlord to be in
default under its leases with such other tenants.
7.
REPAIRS AND
MAINTENANCE
7.1 Tenant shall
generally maintain and repair the Leased Premises, in a good and
workmanlike manner, and shall, at the expiration of the term,
deliver the Leased Premises in good order and condition, damages by
fire or casualty, the elements and ordinary wear and tear excepted.
Tenant covenants and agrees that it shall not cause or permit any
waste, damage or disfigurement to the Leased Premises, or any
overloading of the floors. Tenant shall maintain and make all
repairs to the floor surface, plumbing and electrical systems
(including all ballasts and fluorescent fixtures) and the entire
HVAC system located within the Leased Premises. Landlord shall be
responsible for repairs necessary to the roof, exterior and
load-bearing walls, and electric and plumbing systems to the point
where they enter the Leased Premises, unless repair is necessitated
by any act of Tenant, or
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its agents, employees or
contractors. If, however, any repair or maintenance is required due
to the acts or omissions of Landlord, its agents, contractors or
employees, Landlord will promptly repair the damage, the cost of
such repair to be at Landlord’s expense. Landlord will
maintain and repair all other portions of the Office Park of which
the Building is a part in a proper operating and reasonably safe
condition.
7.2 The Tenant
shall, at its own cost and expense, pay all metered utility and
service charges, including gas and electric servicing the Leased
Premises. Landlord shall have the option to install, at its own
cost, a separate water meter and invoice Tenant directly for its
water usage. The Tenant agrees to maintain all leased areas at a
minimum temperature of 45 degrees, excluding cold rooms or other
rooms specifically designed for a lower temperature, to prevent the
freezing of domestic water and sprinkler pipes. Tenant shall not
store any items outside the Leased Premises, and shall deliver its
garbage and recyclables to the central receiving area on the lot.
Tenant shall dispose of all hazardous/medical waste with an
approved hauler at its own cost.
7.3 Landlord shall
provide the following during the term of this Lease:
(a)
Cooperate with all utility companies
providing water, gas and electrical service to the point where they
enter the Leased Premises for Tenant’s permitted
uses;
(b)
Extermination and pest control when
necessary;
(c)
24-hour access to the Leased
Premises;
(d)
Maintain the fire sprinkler system;
and
(e)
Maintain the common areas of the
Office Park, in a manner similar to other office parks in the area,
with the cost to be passed on to Tenant as set forth in Paragraph
8.
7.4 Landlord does
not warrant that any services Landlord or any public utilities
supply will not be interrupted. Services may be interrupted because
of accidents, repairs, alterations, improvements or any other
reasons beyond the reasonable control of Landlord. If, however, in
the event of an interruption of service or supply which is either
within or outside of Landlord’s control, Tenant is unable to
conduct its business in the Leased Premises for a period of thirty
(30) days, or a total of sixty (60) days in a ninety (90) day
period, then the rent payable hereunder shall abate until such
condition is remedied.
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8.
COMMON AREA EXPENSES, TAXES AND
INSURANCE
8.1 The Tenant
shall pay to the Landlord, monthly, as Additional Rent an amount
equal to Tenant’s proportionate share of the cost of the
following items (“Common Area Expenses”). The cost for
capital improvements to the Building or Office Park shall not be
included in Common Area Expenses. Tenant’s share of the
Common Area Expenses shall be known as its “Proportionate
Share.”
(a)
The costs incurred by the Landlord
for real estate taxes and the operation, maintenance or repair of
the following items in the Office Park;
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(1)
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lawns and landscaping;
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(2)
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water and standby sprinkler charges;
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(3)
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exterior lighting;
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(4)
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exterior sewer lines;
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(5)
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exterior utility lines;
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(6)
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repair and maintenance of any signs serving the
Office Park;
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(7)
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snow removal;
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(8)
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normal garbage disposal and
recycling;
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(9)
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general ground maintenance;
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(10)
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parking lot, driveways and walkways;
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(11)
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maintenance contracts for the roof;
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(12)
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pest control;
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(13)
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central station monitoring for fire sprinkler
system; and
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(14)
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other ordinary maintenance expenses normally
incurred by Landlord relating to the Building and common areas of
the Office Park;
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(b)
The cost of the annual insurance
premiums charged to the Landlord for insurance coverage which
insure the buildings in the Office Park. The insurance shall be for
the full replacement value of all insurable improvements with any
customary extensions of coverage including, but not limited to,
vandalism, malicious mischief, sprinkler damage and comprehensive
liability, and insurance for one year’s rent. The Landlord
shall maintain said insurance in effect at all times hereunder. Any
increase in the insurance premiums due to a change in rating of the
Building
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which is solely attributable to
Tenant’s use, or due to special Tenant equipment, shall be
paid entirely by the Tenant. Tenant expressly acknowledges that
Landlord shall not maintain insurance on Tenant’s furniture,
fixtures, machinery, inventory, equipment or other personal
property. Tenant shall at all times, at its own cost and expense,
carry sufficient “All Risk” property insurance on a
replacement cost basis to avoid any coinsurance penalties in
applicable policies on all of Tenant’s furniture,
furnishings, fixtures, machinery, equipment and installations as
well as on any alterations or improvements made to the Leased
Premises by Tenant at its own cost and expense subsequent to the
Commencement Date. Such coverage is to include property undergoing
additions and alterations, and shall cover the value of equipment
and supplies awaiting installations. On an annual basis, Tenant
shall furnish Landlord with certificates of the existence of such
insurance; and
(c)
The real estate and personal
property taxes assessed against the Office Park for land, building
and improvements, along with any levy for the installation of local
improvements affecting the Office Park assessed by any governmental
body having jurisdiction thereof. The real estate tax obligation of
the Tenant shall include any tax or imposition for parking log
usage that may be levied by any governmental body having
jurisdiction thereof. In addition to its Proportionate Share of the
above items, Tenant shall pay directly all real estate taxes
assessed by the municipality on its Tenant improvements;
and
(d)
A management fee of three (3%)
percent of the Tenant’s Base Rent.
8.2 Tenant’s
Share of Common Area Expenses for any calendar year, part of which
falls within the term of this Lease and part of which does not,
shall be appropriately prorated. Tenant shall not be obligated to
pay any part of (1) any taxes on the income of the Landlord or the
holder of an underlying mortgage and any taxes on the income of the
lessor under any underlying lease, (2) any corporation,
unincorporated business or franchise taxes, (3) any estate gift,
succession or inheritance taxes, (4) any capital gains, mortgage
recording or transfer taxes, (5) any taxes or assessments
attributable to any sign attached to, or located on, the Building
or the land, or (6) any similar taxes imposed on the Landlord, the
holder of any underlying mortgage or the lessor under any
underlying lease.
8.3 During the
first year of the lease term, the Tenant shall pay $3.00 per square
foot as its Proportionate Share. For each subsequent calendar year
of the Term, Landlord shall
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provided Tenant with
Landlord’s estimate of the Tenant’s Proportionate Share
by February 28th. Within ninety (90) days of the expiration of each
calendar year of the Term, the Landlord shall furnish to Tenant a
detailed breakdown of the actual Common Area Expenses. Tenant shall
have the right, within sixty (60) days of receipt of the breakdown,
and during normal business hours, to examine Landlord’s books
and records with respect to the Common Area Expenses. In the event
Tenant’s Proportionate Share shall be greater than the
aggregate paid by the Tenant during the prior period, Tenant shall
pay any difference, in one lump sum within thirty (30) days after
demand. In the event Tenant shall have overpaid its Proportionate
Share, any such overage shall be applied to the Common Area
Expenses prospectively due under the Lease. This procedure shall be
followed during each year of the lease term, and at the expiration
of the Lease, any overage or underage shall be credited or paid
after computation by the Landlord, which obligation of Landlord and
Tenant shall survive the expiration of the lease term.
8.4 If at any time
during the term of this lease the method or scope of taxation
prevailing at the commencement of the lease term shall be altered,
such substituted tax or imposition shall be payable and discharged
by the Tenant in the manner required pursuant to the law which
shall authorize such change.
8.5 The Tenant
covenants and agrees that it will, at its sole cost and expense,
carry liability insurance covering the Leased Premises in the
minimum amount of $1,000,000.00 per accident for one (1) person,
$3,000,000.00 per accident for two (2) or more persons, and a
minimum amount of $300,000.00 for properly damage. The Tenant shall
add the Landlord as an additional insured on such policy and will
furnish Landlord with a certificate of said liability insurance
prior to the Commencement Date and annually thereafter. The
certificate shall contain a clause that the policy will not be
canceled except on ten (10) days written notice to the
Landlord.
8.6 The parties
covenant and agree that the insurance policies required to be
furnished in accordance with the terms and conditions of this
Lease, or in connection with insurance policies which they obtain
insuring such insurable interest as Landlord or Tenant may have in
its own properties, whether personal or real, shall expressly waive
any right of subrogation on the part of the insurer against the
Landlord or Tenant. Landlord and Tenant each waives all right of
recovery
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against the other, its agents or
employees for any loss, damage or injury of any nature whatsoever
to property or person for which the waiving party is required by
this Lease to carry insurance.
9.
SIGNS
Landlord will provide a monument
sign listing all of the tenants in the Office Park. At its sole
expense, the Tenant shall have the right to install on the entrance
door to the Leased Premises, only such signs as are required by
Tenant for the purpose of identifying the Tenant.
10.
ASSIGNMENT AND
SUBLETTING
10.1 The Tenant may
not assign or sublet the Leased Premises without Landlord’s
consent, which shall not be unreasonably withheld. Tenant shall
advise the Landlord in writing, by certified mail, return receipt
requested of its desire to assign or sublease and Landlord shall
have forty-five (45) days from receipt of such notice to notify
Tenant whether it rejects or consents to the assignment or
sublease, or elects to re-capture pursuant to the following.
Landlord shall also have the option to elect to re-capture the
Leased Premises and terminate the Lease. If Landlord elects to
recapture the Leased Premises, Tenant shall surrender the Leased
Premises no later than ninety (90) days after Landlord’s
written notice of its election to recapture.
10.2 The
Landlord’s consent shall not be required and the terms and
conditions of Paragraph 10.1 shall not apply as to Landlord’s
right to recapture if the Tenant assigns or subleases the Leased
Premises to a parent, subsidiary, affiliate or a company into which
Tenant is merged or with which Tenant is consolidated, or to the
purchaser of all or substantially all of the assets of
Tenant.
10.3 In connection
with any permitted assignment or subletting, (i) the Tenant shall
pay monthly to the Landlord fifty (50%) percent of any increment in
rent received by Tenant per square foot over the rent then in
effect during the year of the assignment or subletting, which
payment shall be made monthly together with the required rent
hereunder; and (ii) if Tenant receives any consideration or value
for such assignment or subletting, Landlord shall be paid fifty
(50%) percent of any such consideration or value within ten (10)
days after receipt of the same by Tenant. As a condition hereunder,
Tenant warrants and represents to Landlord that it will furnish to
Landlord a copy of all pertinent documents with respect to any such
assignment or subletting so as to establish Tenant’s
obligation to Landlord hereunder.
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10.4 In the event
of any assignment or subletting permitted by the Landlord, the
Tenant shall remain and be directly and primarily responsible for
payment and performance of the within Lease obligations, and the
Landlord reserves the right, at all times, to require and demand
that the Tenant pay and perform the terms and conditions of this
Lease. In the case of a complete recapture, Tenant shall be
released from all further liability with respect to the recaptured
space. No such assignment or subletting shall be made to any Tenant
who shall occupy the Leased Premises for any use other than that
which is permitted to the Tenant, or for any use which may be
deemed inappropriate for the Building or extra hazardous, or which
would in any way violate applicable laws, ordinances or rules and
regulations of governmental boards and bodies having
jurisdiction.
11.
FIRE AND CASUALTY
11.1 In case of any
damage to or destruction of any portion of the building of which
the Leased Premises is a part by fire or other casualty occurring
during the term of this Lease (or previous thereto), which shall
render at least one-third (1/3 rd ) of the
floor area of the Leased Premises or the building untenantable or
unfit for occupancy, which damage cannot be repaired within one
hundred eighty (180) days from the happening of such casualty,
using reasonable diligence (“Total Destruction”) then
the term hereby created shall, at the option of the Landlord, upon
written notice to the Tenant within fifteen (15) days of such fire
or casualty, cease and become null and void from the date of such
Total Destruction. In such event the Tenant shall immediately
surrender the Leased Premises to the Landlord and this Lease shall
terminate. The Tenant shall only pay rent to the time of such Total
Destruction. However, in the event of Total Destruction if the
Landlord shall elect not to cancel this Lease within the 15-day
period, the Landlord shall repair and restore the same to
substantially the same condition as it was prior to the damage or
destruction, with reasonable speed and dispatch. The rent shall not
be accrued after said damage or while the repairs and restorations
are being made, but shall recommence immediately after the premises
are restored as evidenced by the issuance of a CO/CA by municipal
authorities. In any case where Landlord must restore, consideration
shall be given for delays under the Force Majeure paragraph in this
Lease. Whether or not this Lease has been terminated as a result of
a casualty, in every instance, all insurance proceeds payable as a
result of damage or destruction to the Building shall be paid to
Landlord as its sole and exclusive property.
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11.2 In the event
of any other casualty which shall not be tantamount to Total
Destruction the Landlord shall repair and restore the Building and
the Leased Premises to substantially the same condition as they
were prior to the damage or destruction, with reasonable speed and
dispatch. The rent shall abate or shall be equitably apportioned as
to any portion of the Leased Premises which shall be unfit for
occupancy by the Tenant, or which cannot be used by the Tenant to
conduct its business. The rent shall recommence immediately upon
restoration of the Leased Premises as evidenced by the issuance of
a CO/CA by municipal authorities.
11.3 In the event
of any casualty caused by an event which is not covered by
Landlord’s insurance policy, the Landlord may elect to treat
the casualty as though it had insurance or it may terminate the
Lease. If it treats the casualty as though it had insurance then
the provisions of this paragraph shall apply. The Landlord shall
serve a written notice upon the Tenant within fifteen (15) days of
the casualty specifying the election which it chooses to
make.
11.4 In the event
the Landlord rebuilds, the Tenant agrees, at its cost and expense,
to forthwith remove any and all of its equipment, fixtures, stock
and personal property in order to permit Landlord to expedite the
construction. The Tenant shall assume at its sole risk the
responsibility for damage to or security of such fixtures and
equipment in the event that any portion of the building area has
been damaged and is not secure.
12.
COMPLIANCE WITH LAWS, RULES AND
REGULATIONS
12.1 (a)
The Tenant agrees that upon
acceptance and occupancy of the Leased Premises, it will, at its
own cost and expense, comply with all statutes, ordinances, rules,
orders, regulations and requirements of the Federal, State and
Municipal governments arising from the operations of Tenant at the
Leased Premises. The Tenant also agrees that it will not
comm