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EXHIBIT
10.20
Tenant: International Mill
Service Inc.
Suite No.:
LEASE
THIS LEASE
(“Lease”) is entered into as of the 3
rd day May, 2005, between BRANDYWINE OPERATING
PARTNERSHIP, L.P., a Delaware limited partnership
(“Landlord”), and INTERNATIONAL MILL SERVICE, INC., a
Pennsylvania corporation with its principal place of business at
1155 Business Center Drive, Horsham, Pennsylvania
(“Tenant”).
Landlord’s predecessor
and Tenant’s predecessor are parties to a certain Lease
Agreement dated December 21, 1990, as amended by Lease
Modification Agreement dated March 28, 1996, Second Lease
Modification Agreement dated April 7,1996 and Third Amendment
to Lease dated September 26, 1997 (“Existing
Lease”). Landlord and Tenant desire to amend the Existing
Lease for the period from the date hereof through March 31,
2006 in accordance with Article 28 hereof and thereafter terminate
the Existing Lease as of March 31, 2006 and put into effect on
April 1, 2006, the provisions of Articles 1 through 27 hereof.
In consideration of the mutual covenants stated below, and
intending to be legally bound, the parties covenant and agree as
follows:
1. PREMISES .
Effective April 1, 2006, Landlord leases to Tenant and Tenant
leases from Landlord Suite No. 200, which the parties
stipulate and agree is 24,038 shown on the plan which shall be
prepared in accordance with Article28 hereof and thereafter
attached hereto as Exhibit “A”
(“Premises”), located at 1155 Business Center Drive,
Horsham, Pennsylvania (“Building”), which is a part of
the project located at Horsham Business Center, Horsham,
Pennsylvania (“Project”). Except as set forth in
Article 28 the Premises are delivered “As
Is”.
2. TERM . The Term of
this Lease shall commence on April 1, 2006 (the
“Commencement Date”). The Term shall be for a period of
sixty (60) months (‘Term”) ending on the last day
of the calendar month. The Commencement Date shall be confirmed by
Landlord and Tenant by the execution of a Confirmation of Lease
Term (“COLT”) in the form attached hereto as Exhibit
“B ”. If Tenant fails to execute or object to the
COLT within ten (10) business days of its delivery,
Landlord’s determination of such dates shall be deemed
accepted by Tenant.
3. FIXED RENT; SECURITY
DEPOSIT .
(a) Commencing on the
Commencement Date and on the first (l st
) day of each
month thereafter during the Term, Tenant shall pay to Landlord
without notice or demand, and without set-off, deduction or
counterclaim (except as otherwise set forth in this Lease) the
monthly installment of annual Fixed Rent as set forth below by
(i) check sent to Landlord, P.O. Box 8538-363, Philadelphia,
PA 19171 or (ii) wire transfer of immediately available funds
to the account at Wachovia Bank, Salem NJ account no. 2030000359075
ABA #031201467; such transfer to be confirmed by Landlord’s
accounting department upon written request by Tenant All payments
must include the following information: Building #115 and Lease #
. The Lease # will be provided to Tenant in the Confirmation of
Lease Term Fixed Rent and all other sums due from Tenant under this
Lease shall collectively be defined as
“Rent”.
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LEASE
YEAR
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PER
R.S.F.
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INSTALLMENTS
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FIXED
RENT
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| Months 1-12 |
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$19.50, * |
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$39,061.75 |
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$468,741.00 |
| Months 13-24 |
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$20.00, * |
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$40,063.33 |
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$480,760.00 |
| Months 25-36 |
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$20.50, * |
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$41,064.92 |
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$492,779.00 |
| Months 37-48 |
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$21.00, * |
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$42,066.50 |
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$504,798.00 |
| Months 49-60 |
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$21.50, * |
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$43,068.08 |
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$576,817.00 |
| * |
plus any charges set forth in Articles 4 and 5 below. Upon
final determination of the square footage of the Premises and
monthly installment and annual Fixed Rent shall be calculated and
verified in the Confirmation of Lease Term Agreement |
(b) Tenant shall pay the
first full month’s installment of Fixed Rent (or such initial
partial month) and the Security Deposit (as defined below) by two
separate checks upon the Tenant’s execution of this Lease. If
any amount due from Tenant is not paid to Landlord when due. Tenant
shall also pay as Additional Rent (as defined in Article 4
hereof) a late fee of ten (10%) percent of the total payment
then due. The late fee shall accrue on the initial date of a
payment’s due date, irrespective of any grace period granted
hereunder. Tenant shall be required to continue to post a security
deposit of $28,795 under this Lease (the “Security
Deposit”), as security for the prompt and complete
performance by Tenant of every provision of this Lease. No interest
shall be paid to Tenant on the Security Deposit. If Tenant fails to
perform any of its obligations hereunder. Landlord may use, apply
or retain the whole or any part of the Security Deposit for the
payment of (i) any rent or other sums of money which Tenant
may not have paid when due, (ii) any sum expended by Landlord
in accordance with the provisions of this Lease, and/or
(iii) any sum which Landlord may expend or be required to
expend by reason of Tenant’s default. The use of the Security
Deposit by Landlord shall not prevent Landlord from exercising any
other remedy provided by this Lease or
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by law and shall not operate as either
liquidated damages or as a limitation on any recovery to which
Landlord may otherwise be entitled. If any portion of the Security
Deposit is used, applied or retained by Landlord, Tenant agrees,
within five (5) days after the written demand therefor is made
by Landlord, to deposit cash with the Landlord in an amount
sufficient to restore the Security Deposit to its original amount.
In addition to the foregoing, if Tenant defaults (irrespective of
the fact that Tenant cured such default) more than once in its
performance of a monetary obligation and such monetary defaults
aggregate in excess of $50,000 under this Lease, Landlord may
require Tenant to increase the Security Deposit to the greater of
twice the (i) Fixed Rent then paid monthly, or (ii) the
initial amount of the Security Deposit. If Tenant shall fully
comply with all of the provisions of this Lease, the Security
Deposit, or any balance thereof, shall be returned to Tenant within
a reasonable time after the later of expiration of the Term or
Tenant’s surrender of the Premises as required hereunder.
Upon the return of the Security Deposit to the original Tenant
hereunder, or the remaining balance thereof, Landlord shall be
completely relieved of liability with respect to the Security
Deposit. In the event of a transfer of the Building, Landlord shall
have the right to transfer the Security Deposit and Landlord shall
thereupon be released by Tenant from all liability for the return
of such Security Deposit. Upon the assumption of such Security
Deposit by the transferee, Tenant agrees to look solely to the new
landlord for the return of said Security Deposit.
4. ADDITIONAL RENT .
Effective April 1, 2006 but commencing January 1, 2007,
and in each calendar year thereafter during the Term, Tenant shall
pay in advance on a monthly basis to Landlord, Tenant’s Share
of the “Recognized Expenses”, without deduction,
counterclaim or setoff, to the extent such Recognized Expenses
exceed the Recognized Expenses in calendar year 2006 (“Base
Year”). Tenant’s Share shall be 46.77% which is the
percentage calculated by dividing the total square footage of the
Premises into the total square footage of the Building which is
51,388. Recognized Expenses are (i) all reasonable operating
costs and expenses related to the maintenance, operation and repair
of the Project incurred by Landlord, including but not limited to
management fee not to exceed five (5%) percent of Rent; common
area electric; and capital expenditures and capital repairs and
replacements shall be included as operating expenses solely
to the extent of the amortized costs of same over the useful life
of the improvement in accordance with generally accepted accounting
principles such useful life not to exceed ten (10) years;
(ii) all insurance premiums payable by Landlord for insurance
with respect to the Project and (iii) Taxes payable on the
Project. Each of the Recognized Expenses shall for all purposes be
treated and considered as Additional Rent. Tenant shall pay, in
monthly installments in advance, on account of Tenant’s Share
of Recognized Expenses, the estimated amount of the increase of
such Recognized Expenses for such year in excess of the Base Year
as determined by Landlord in its reasonable discretion. Prior to
the end of the calendar year in which the Lease commences and
thereafter for each successive calendar year (each, a “Lease
Year”), or part thereof, Landlord shall send to Tenant a
statement of projected increases in Recognized Expenses in excess
of the Base Year and shall indicate what Tenant’s Share of
Recognized Expenses shall be. The Base Year shall be adjusted to
exclude from the Base Year “extraordinary items”
incurred in such calendar year. For purposes or this subparagraph,
extraordinary items shall mean either (X) cost increases over
the prior calendar year of eleven and one quarter percent
(11.25%) or more, or (Y) items which increase
Landlord’s total expenses and such items have not been
included in the determination of expenses by the Landlord (or the
Landlord’s predecessor in interest) for the prior three years
of operating the Building. As soon as administratively available,
Landlord shall send to Tenant a statement of actual for Recognized
Expenses for the prior Lease Year showing the Share due from
Tenant. In the event the amount prepaid by Tenant exceeds the
amount that was actually due then Landlord shall issue a credit to
Tenant in an amount equal to the over charge, which credit Tenant
may apply to future payments on account of Recognized Expenses
until Tenant has been fully credited with the over charge. If the
credit due to Tenant is more than the aggregate total of future
rental payments, Landlord shall pay to Tenant the difference
between the credit in such aggregate total. In the event Landlord
has undercharged Tenant, then Landlord shall send Tenant an invoice
with the additional amount due, which amount shall be paid in full
by Tenant within thirty (30) days of receipt.
Tenant shall have the right,
at its sole cost and expense, within ninety (90) days from
receipt of Landlord’s statement of Recognized Expenses, to
audit or have its appointed accountant audit Landlord’s
records related to Recognized Expenses and Taxes provided that any
such audit may not occur more frequently than once each calendar
year nor apply to any year prior to the year of the statement being
reviewed. In the event Tenant’s audit discloses any
discrepancy, Landlord and Tenant shall use their best efforts to
resolve the dispute and make an appropriate adjustment, failing
which, they shall submit any such dispute to arbitration pursuant
to the rules and under the jurisdiction of the American Arbitration
Association in Philadelphia, Pennsylvania. The decision rendered in
such arbitration shall be final, binding and non-appealable. The
expenses of arbitration, other than individual legal and accounting
expenses which shall be the respective parties’
responsibility, shall be divided equally between the parties. In
the event, by agreement or as a result of an arbitration decision,
it is determined that the actual Recognized Expenses and Taxes
exceeded those claimed by the Landlord by more than six percent
(6%), the actual, reasonable hourly costs to Tenant of
Tenant’s audit (including legal and accounting costs) shall
be reimbursed by Landlord. In the event Tenant utilizes a
contingent fee auditor and Landlord is responsible for the payment
of such auditor, Landlord shall only pay the reasonable hourly fee
of such auditor
5. ELECTRICITY CHARGES
. Landlord shall not be liable for any interruption any utility
service for any reason unless caused by the gross negligence or
willful misconduct of Landlord. Tenant shall pay to Landlord, as
Additional Rent, within fifteen (15) business days of receipt
of Landlord’s billing statement therefor, all charges
incurred by Landlord for electricity, such charges to be based upon
Tenant’s consumption, as measured by Landlord’s
submeter for the Premises.
6. SIGNS; USE OF PREMISES
AND COMMON AREAS . Landlord shall provide the original Tenant
hereinabove named with standard identification signage on all
Building directories and at the entrance to the
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Premises and shall replace the existing
sign outside the Building with a sign of similar size and design to
properly reflect the Tenant’s name and its designated
affiliate. No other signs shall be placed, erected or maintained by
Tenant at any place upon the Premises, Building or Project.
Tenant’s use of the Premises shall be limited to general
office use and storage incidental thereto (“Permitted
Use”). The Permitted Use shall be subject to all applicable
laws and governmental rules and regulations and to all reasonable
requirements of the insurers of the Building Tenant shall not
install in or for the Premises, any equipment which requires more
electric current than is standard. Tenant shall have the right,
non-exclusive and in common with others, to use (i) the
exterior paved driveways and walkways of the Building for vehicular
and pedestrian access to the Building, (ii) the internal
common area, including elevators and (iii) the designated
parking areas of the Project for the parking of automobiles of
Tenant and its employees and business visitors; provided Landlord
shall have the right in its sole discretion and from time to time,
to construct, maintain, operate, repair, close, limit, take out of
service, alter, change and modify all or any part of the common
areas of the Project, including without limitation, reasonably
restrict or limit Tenant’s utilization of the parking areas
in the event the same become overburdened and in such case to
equitably allocate on proportionate basis or assign parking spaces
among Tenant and the other tenants of the Building.
7. ENVIRONMENTAL
MATTERS . Tenant shall not generate, manufacture, refine,
transport, treat, store, handle, dispose, bring or otherwise cause
to be brought or permit any of its agents, employees, contractors
or invitees to bring in, on or about any part of the Premises,
Building or Project, any hazardous substance or hazardous waste in
violation of applicable law.
8. TENANTS ALTERATIONS
. Tenant will not cut or drill into or secure any fixture,
apparatus or equipment or make alterations, improvements or
physical additions (collectively, “Alterations”) of any
kind to any part of the Premises without first obtaining the
written consent of Landlord, such consent not to be unreasonably
withheld. Notwithstanding anything in this Lease to the contrary,
all furniture, movable trade fixtures and equipment (but not
including telephone, security and communication equipment system
wiring and cabling) installed by or for Tenant, its assignees or
sublessees shall be removed by Tenant at the termination of this
Lease.
9. ASSIGNMENT AND
SUBLETTING . Tenant shall not, without the prior written
consent of Landlord, assign this Lease or any interest herein or
sublet the Premises or any part thereof. Any of the foregoing acts
without such consent shall be void. If at any time during the Term
Tenant desires to assign this Lease or sublet all or any part of
the Premises, Tenant shall give notice to Landlord of such desire,
including the name, address and contact party for the proposed
assignee or subtenant, the effective date of the proposed
assignment or sublease (including the proposed occupancy date by
the proposed assignee or sublessee), and in the instance of a
proposed sublease, the square footage to be subleased, a floor plan
professionally drawn to scale depicting the proposed sublease area,
and a statement of the duration of the proposed sublease (which
shall in any and all events expire by its terras prior to the
scheduled expiration of this Lease, and immediately upon the sooner
termination hereof). Landlord may, at its option, exercisable by
notice given to Tenant within forty-five (45) days next
following Landlord’s receipt of Tenant’s notice, elect
to recapture the Premises if Tenant is proposing to sublet more
than twenty-five (25%) percent of the Premises or terminate
this Lease in the event of an assignment. Regardless of
Landlord’s consent, no subletting or assignment shall release
Tenant of Tenant’s obligation or alter the primary liability
of Tenant to pay the Rent and to perform all other obligations to
be performed by Tenant hereunder for the remainder of the then
current Lease Term. Landlord shall be entitled to a $250 fee for
consenting to any sublet or assignment.
10. LANDLORD’S RIGHT
OF ENTRY . Landlord and persons authorized by Landlord may
enter the Premises at all reasonable times upon reasonable advance
notice (or any time without notice in the case of an emergency).
Landlord shall not be liable for inconvenience to or disturbance of
Tenant by reason of any such entry; provided, however, that in the
case of repairs or work, such shall be done, so far as practicable,
so as to not unreasonably interfere with Tenant’s use of the
Premises.
11. REPAIRS AND
MAINTENANCE . Tenant, at its sole cost and expense, shall keep
and maintain the Premises in good order and condition, free of
rubbish, and shall promptly make all non-structural repairs
necessary to keep and maintain such good order and condition.
Tenant shall have the option of replacing lights, ballasts, tubes,
ceiling tiles, outlets and similar equipment itself or it shall
have the ability to advise Landlord of Tenant’s desire to
have Landlord make such repairs. If requested by Tenant, Landlord
shall make such repairs to the Premises within a reasonable time of
notice to Landlord and shall charge Tenant for such services at
Landlord’s standard rate (such rate to be competitive with
the market rate for such services). When used in this Article
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and renewals when necessary. All repairs made by Tenant or Landlord
shall utilize materials and equipment which are at least equal in
quality and usefulness to those originally used in constructing the
Building and the Premises. Landlord shall provide the janitorial
services for the Premises set forth on Exhibit
“C” .
12. INSURANCE; SUBROGATION
RIGHTS . Tenant shall obtain and keep in force at all times
during the term hereof, at its own expense, commercial general
liability insurance including contractual liability and personal
injury liability and all similar coverage, with combined single
limits of $2,000,000.00 on account of bodily injury to or death of
one or more persons as the result of any one accident or disaster
and on account of damage to property. Tenant shall also require its
movers to procure and deliver to Landlord a certificate of
insurance naming Landlord as an additional insured. Tenant shall,
at its sole cost and expense, maintain in full force and effect on
all Tenant’s trade fixtures, equipment and personal property
on the Premises, a policy of “special form” property
insurance covering the full replacement value of such property. All
liability insurance required hereunder shall not be subject
to cancellation without at least thirty (30) days prior notice
to all insureds, and shall name Tenant as
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insured and Landlord and Brandywine
Realty Trust as additional insureds, and, if requested by Landlord,
shall also name as an additional insured any mortgagee or holder of
any mortgage which may be or become a lien upon any part of the
Premises. Prior to the commencement of the Term, Tenant shall
provide Landlord with certificates which evidence that the
coverages required have been obtained for the policy periods.
Tenant shall also furnish to Landlord throughout the Term
replacement certificates at least thirty (30) days prior to
the expiration dates of the then current policy or policies. All
the insurance required under this Lease shall be issued by
insurance companies authorized to do business in the Commonwealth
of Pennsylvania with a financial rating of at least an A-X as rated
in the most recent edition of Best’s Insurance Reports and in
business for the past five years. The limit of any such insurance
shall not limit the liability of Tenant hereunder. If Tenant fails
to maintain such insurance, Landlord may, but is not required to,
procure and maintain the same, at Tenant’s expense to be
reimbursed by Tenant as Additional Rent within ten (10) days
of written demand. Any deductible under such insurance policy in
excess of Twenty Five Thousand ($25,000) must be approved by
Landlord in writing prior to issuance of such policy. Tenant shall
not self-insure without Landlord’s prior written consent Each
party hereto, and anyone claiming through or under them by way of
subrogation, waives and releases any cause of action it might have
against the other party and Brandywine Realty Trust and their
respective employees, officers, members, partners, trustees and
agents, on account of any loss or damage that is insured against
under any insurance policy required to be obtained hereunder. Each
party agrees that it will use its best efforts to cause its
insurance carrier to endorse all applicable policies waiving the
carrier’s right of recovery under subrogation or otherwise
against the other party.
13. INDEMNIFICATION .
Tenant shall defend, indemnify and hold harmless Landlord,
Brandywine Realty Trust and their respective employees and agents
from and against any and all third-party claims, actions, damages,
liability and expense (including all reasonable attorney’s
fees, expenses and liabilities incurred in defense of any such
claim or any action or proceeding brought thereon) arising from any
activity, work or things done, permitted or suffered by Tenant or
its agents, licensees or invitees in or about the Premises, the
Building or the Project contrary to the requirements of this Lease,
and any negligence or willful act of Tenant or any of
Tenant’s agents, contractors, employees or invitees. Without
limiting the generality of the foregoing, Tenant’s
obligations shall include any case in which Landlord or Brandywine
Realty Trust shall be made a party to any litigation commenced by
or against Tenant, its agents, subtenants, licensees,
concessionaires, contractors, customers or employees, in which case
Tenant shall defend, indemnify and hold harmless Landlord and
Brandywine Realty Trust and shall pay all costs, expenses and
reasonable attorney’s fees incurred or paid by Landlord and
Brandywine Realty Trust in connection with such litigation, after
notice to Tenant and Tenant’s refusal to defend such
litigation, and upon notice from Landlord shall defend the same at
Tenant’s expense by counsel reasonably satisfactory to
Landlord.
14. FIRE DAMAGE . If
(i) the casualty damage is of a nature or extent that, in
Landlord’s reasonable judgment, the repair and restoration
work would require more than two hundred ten (210) consecutive
days to complete after the casualty (assuming normal work crews not
engaged in overtime), or (ii) more than thirty
(30%) percent of the total area of the Building is extensively
damaged, or (iii) the casualty occurs in the last Lease Year
of the Term and Tenant has not exercised a renewal right or
(iv) insurance proceeds are unavailable or insufficient,
either party shall have the right to terminate this Lease and all
the unaccrued obligations of the parties hereto, by sending written
notice of such termination to the other within thirty
(30) days of the date of casualty. Such notice is to specify a
termination date no less than fifteen (15) days after its
transmission. In the event of damage or destruction to the Premises
or any part thereof as set forth in subsections (i), (ii) or
(iii) above and neither party has terminated this Lease,
Tenant’s obligation to pay Fixed Rent and Additional Rent
shall be equitably adjusted or abated for such time as the Premises
is not capable of being used by Tenant for its Permitted
Use.
15. SUBORDINATION; RIGHTS
OF MORTGAGEE . This Lease shall be subordinate at all times to
the lien of any mortgages now or hereafter placed upon the
Premises, Building and/or Project and land of which they are a part
without the necessity of any further instrument or act on the part
of Tenant to effectuate such subordination. Tenant further agrees
to execute and deliver within ten (10) day of demand such
further instrument evidencing such subordination and attornment as
shall be reasonably required by any mortgagee. If Landlord shall be
or is alleged to be in default of any of its obligations owing to
Tenant under this Lease, Tenant shall give to the holder of any
mortgage (the “Mortgagee”) now or hereafter placed upon
the Premises, Building and/or Project, notice by overnight mail of
any such default which Tenant shall have served upon Landlord.
Tenant shall not be entitled to exercise any right or remedy as
there may be because of any default by Landlord without having
given such notice to the Mortgagee. If Landlord shall fail to cure
such default, the Mortgagee shall have forty-five
(45) additional days within which to cure such
default.
16. CONDEMNATION . If
in Landlord’s reasonable judgement a taking renders the
Building unsuitable at Landlord’s option, this Lease shall,
at either party’s option, terminate as of the date title to
the condemned real estate vests in the condemnor, and the Rent
herein reserved shall be apportioned and paid in full by Tenant to
Landlord to that date and all rent prepaid for period beyond that
date shall forthwith be repaid by Landlord to Tenant and neither
party shall thereafter have any liability hereunder. If this Lease
is not terminated after any such taking or condemnation, the Fixed
Rent and the Additional Rent shall be equitably reduced in
proportion to the area of the Premises which has been taken for the
balance of the Term. Tenant shall have the right to make a claim
against the condemnor to the extent that such claim does not reduce
the sums otherwise payable by the condemnor to Landlord.
17. ESTOPPEL
CERTIFICATE . Each party agrees at any time and from time to
time, within ten (10) days after the other party’s
written request, to execute and deliver to the other party a
written instrument in recordable form certifying all information
reasonably requested.
18. DEFAULT . If:
Tenant fails to pay any installment of Rent when due; provided,
however, Landlord shall provide written notice of the failure to
pay such Rent and Tenant shall have a three (3) business
day
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grace period from its receipt of such
Landlord’s notice within which to pay such Rent without
creating a default hereunder. The late fee set forth in Article 3
hereof shall be due on the first day after such payment is due
irrespective of the foregoing notice and grace period; Tenant
“vacates” the Premises (other than in the case of a
permitted subletting or assignment) or permits the same to be
unoccupied; Tenant fails to bond over a construction or mechanics
lien within ten (10) days of demand; Tenant fails to observe
or perform any of Tenant’s other non-monetary agreements or
obligations herein contained within ten (10) days after
written notice specifying the default, or the expiration of such
additional time period as is reasonably necessary to cure such
default, provided Tenant immediately commences and thereafter
proceeds with all due diligence and in good faith to cure such
default; then, in any such event, an “Event of Default”
shall be deemed to exist and Tenant shall be in default
hereunder.
If an Event of Default shall
occur, the following provisions shall apply and Landlord shall
have, in addition to all other rights and remedies available at law
or in equity, including the right to terminate the Lease, the
rights and remedies set forth herein, which may be exercised upon
or at any time following the occurrence of an Event of Default. 1.
Acceleration of Rent . By notice to Tenant, Landlord shall
have the right to accelerate all Rent and all expense due hereunder
and otherwise payable in installments over the remainder of the
Term; and the amount of accelerated rent to the termination date,
without further notice or demand for payment, shall be due and
payable by Tenant within five (5) days after Landlord has so
notified Tenant, such amount collected from Tenant shall be
discounted to present value using an interest rate of six percent
(6%) per annum. Additional Rent which has not been included,
in whole or in part, in accelerated rent, shall be due and payable
by Tenant during the remainder of the Term, in the amounts and at
the times otherwise provided for in this Lease. 2.
Landlord’s Damages . The damages which Landlord shall
be entitled to recover from Tenant shall be the sum of:
(i) all Fixed Rent and Additional Rent accrued and unpaid as
of the termination date; and (ii)(a) all reasonable costs and
expenses incurred by Landlord in recovering possession of the
Premises, including actual legal fees, and removal and storage of
Tenant’s property, (ii)(b) the reasonable costs and
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