Exhibit 10.15
AGREEMENT OF LEASE
between
LIBERTY PROPERTY LIMITED PARTNERSHIP
("LANDLORD")
and
VerticalNet, INC.
("TENANT")
for
000 Xxxxxxx Xxxx
Xxxxxxxxxxxx Business Campus
Xxxxxxx, Xxxxxxxxxxxx 00000
Lease Agreement
(Multi-Tenant Office)
INDEX
ss. SECTION PAGE
--- ------- ----
1. Summary of Terms and Certain Definitions .................................................. 1
2. Premises .................................................................................. 2
3. Acceptance of Premises .................................................................... 2
4. Use; Compliance ........................................................................... 2
5. Term ....................................................................................... 2
6. Minimum Annual Rent ....................................................................... 3
7. Operation of Property; Payment of Expenses ................................................ 3
8. Signs ..................................................................................... 4
9. Alterations and Fixtures .................................................................. 5
10. Mechanics' Liens .......................................................................... 5
11. Landlord's Right to Relocate Tenant; Right of Entry ....................................... 5
12. Damage by Fire or Other Casualty .......................................................... 5
13. Condemnation .............................................................................. 6
14. Non-Abatement of Rent ..................................................................... 6
15. Indemnification of Landlord ............................................................... 6
16. Waiver of Claims .......................................................................... 6
17. Quiet Enjoyment ........................................................................... 6
18. Assignment and Subletting ................................................................. 6
19. Subordination; Mortgagee's Rights ......................................................... 7
20. Recording; Tenant's Certificate ........................................................... 7
21. Surrender; Abandoned Property ............................................................. 8
22. Curing Tenant's Defaults .................................................................. 8
23. Defaults - Remedies ....................................................................... 8
24. Representations of Tenant ................................................................. 9
25. Liability of Landlord ..................................................................... 9
26. Interpretation; Definitions ............................................................... 10
27. Notices ................................................................................... 10
28. Security Deposit .......................................................................... 11
RIDER
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ss. SECTION PAGE
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29. PA Additional Remedies .................................................................... R-1
30. Base Building Improvements; Tenant Improvements ........................................... R-2
31. Multiple Option to Extend Term ............................................................ R-6
32. Expansion Option .......................................................................... R-7
33. Right of First Offer ...................................................................... R-8
34. Tenant's Need to Expand ................................................................... R-8
35. Parking ................................................................................... R-9
36. Termination of Existing Leases ............................................................ R-9
37. Contingency ............................................................................... R-9
38. Rental Abatement .......................................................................... R-10
39. Additional Provisions Relating to Building and Premises ................................... R-10
40. Additional Provisions Relating to Use; Compliance ......................................... R-10
41. Additional Provisions Relating to Minimum Annual Rent ..................................... R-10
42. Additional Provisions Relating to Operating of Property, Payment of Expenses .............. R-11
43. Additional Provisions Relating to Alterations and Fixtures ................................ R-16
44. Additional Provisions Relating to Mechanics' Liens ........................................ R-17
45. Additional Provisions Relating to Landlord's Right to Relocate Tenant, Right of Entry ..... R-17
46. Additional Provisions Relating to Damage by Fire or Other Casualty ........................ R-17
47. Additional Provisions Relating to Condemnation ............................................ R-18
48. Additional Provisions Relating to Nonabatement of Rent .................................... R-18
49. Landlord's Indemnification of Tenant ...................................................... R-18
50. Additional Provisions Relating to Waiver of Claims ........................................ R-19
51. Additional Provisions Relating to Assignment and Subletting ............................... R-19
52. Additional Provisions Relating to Subordination; Mortgagee's Right ........................ R-20
53. Additional Provisions Relating to Recording; Tenant's Certificate ......................... R-20
54. Additional Provisions Relating to Surrender, Abandoned Property ........................... R-21
55. Additional Provisions Relating to Curing Tenant's Defaults ................................ R-21
56. Additional Provisions Relating to Defaults - Remedies ..................................... R-22
57. Landlord's Representation Regarding Authority ............................................. R-23
58. Additional Provisions Relating to Liability of Landlord ................................... R-23
59. Additional Provisions Relating to Interpretation; Definitions ............................. R-24
60. Additional Provisions Relating to Notices ................................................. R-24
61. Additional Provisions Relating to Security Deposit ........................................ R-24
62. Additional Provisions Relating to Tenant Estoppel Certificate ............................. R-25
63. Landlord's Warranty ....................................................................... R-25
64. Additional Provisions Relating to Building Rules .......................................... R-26
THIS LEASE AGREEMENT is made by and between Liberty Property Limited
Partnership, a Pennsylvania limited partnership ("LANDLORD") with its address at
000 Xxxxxx Xxxx, Xxxxxxx, Xxxxxxxxxxxx 00000 and VerticalNet, INC., a
Corporation organized under the laws of Pennsylvania ("TENANT") with its address
at 0 Xxxxxx Xxxxx Xxxxx, Xxxxx 000, Xxxxxxx, Xxxxxxxxxxxx 00000 is dated as of
the date on which this lease has been fully executed by Landlord and Tenant.
1. Summary of Terms and Certain Definitions.
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(a) "PREMISES": Approximate rentable square feet: 58,863
(Section 2) Suite: 100
(b) "BUILDING": Approximate rentable square feet: 110,000
(ss.2) Address: 000 Xxxxxxx Xxxx
Xxxxxxx, Xxxxxxxxxxxx 00000
(Horsham Township, Xxxxxxxxxx County)
(c) "TERM": One Hundred and Twenty (120) months plus any partial month
(ss.5) from the Commencement Date until the first day of the first
full calendar month during the term
(i) "COMMENCEMENT DATE": July 1, 1999, See Section 30(a)
(ii) "EXPIRATION DATE": See Section 5
(d) Minimum Rent (ss.6) & Operating Expenses (ss.7)
(i) "MINIMUM ANNUAL RENT": $809,954.88 (Eight Hundred Nine Thousand
Nine Hundred Fifty-four and 88/100 Dollars), payable in monthly
installments of $67,496.24 (Six-seven Thousand Four Hundred
Ninety-six and 24/100 Dollars), Increased as follows:
Lease Year Annual Monthly Lease Year Annual Monthly
---------- ------ ------- ---------- ------ -------
2 $ 830,556.93 $ 69,213.08 6 $ 912,965.13 $ 76,080.43
3 $ 851,158.98 $ 70,929.92 7 $ 933,567.18 $ 77,797.27
4 $ 871,761.03 $ 72,646.75 8 $ 954,169.23 $ 79,514.10
5 $ 892,363.08 $ 74,363.59 9 $ 974,771.28 $ 81,230.94
10 $ 995,373.33 $ 82,947.78
(ii) Estimated "ANNUAL OPERATING EXPENSES": $449,124.69 (Four Hundred
Forty-nine Thousand One Hundred Twenty-four and 69/100 Dollars),
payable in monthly installments of $37,427.06 (Thirty-seven
Thousand Four Hundred Twenty-seven and 06/100 Dollars), subject
to adjustment (ss. 7(a))
(e) "PROPORTIONATE SHARE" 53.51% (Ratio of approximate rentable square feet
(ss.7(a)): in the Premises to approximate rentable square feet
in the Building)
(f) "USE" (ss.4): General Business office purposes (excluding any "place of
public accommodation"
(g) "SECURITY DEPOSIT" (ss.28): $1,220,261.00 (One Million Two Hundred Twenty
Thousand Two Hundred Sixty-one and 00/100
Dollars)
(h) CONTENTS: This lease consists of the Index, pages 1 through 11 containing
Sections 1 through 28 and the following, all of which are
attached hereto and made a part of this lease:
Rider 29 through 64
Exhibits: "A"-Plan showing Premises "F"-Base Building Improvements
"B"-Commencement Certificate Form "G"-Plans
"C"-Building Rules "H"-Specifications
"D"-Cleaning Schedule "I"-Existing Leases
"E"-Estoppel Certificate Form "J"-Landlord's Subordination
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2. Premises. Landlord hereby leases to Tenant and Tenant hereby leases from
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Landlord the Premises as shown on attached Exhibit "A" within the Building (the
Building and the lot on which it is located, the "PROPERTY"), together with the
non-exclusive right with Landlord and other occupants of the Building to use all
areas and facilities provided by Landlord for the use of all tenants in the
Property including any lobbies, hallways, driveways, sidewalks and parking,
loading and landscaped areas (the "COMMON AREAS").
3. Acceptance of Premises. Tenant has examined and knows the condition of the
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Property, the zoning, streets, sidewalks, parking areas, curbs and access ways
adjoining it, visible easements, any surface conditions and the present uses,
and Tenant accepts them in the condition in which they now are, without relying
on any representation, covenant or warranty by Landlord. Tenant and its agents
shall have the right, at Tenant's own risk, expense and responsibility, at all
reasonable times prior to the Commencement Date, to enter the Premises for the
purpose of taking measurements and installing its furnishings and equipment,
provided that the Premises are vacant and Tenant obtains Landlord's prior
written consent.
4. Use; Compliance.
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(a) Permitted Use. Tenant shall occupy and use the Premises for and only
for the Use specified in Section 1(f) above and in such a manner as is lawful,
reputable and will not create any nuisance or otherwise interfere with any other
tenant's normal operations or the management of the Building. Without limiting
the foregoing, such Use shall exclude any use that would cause the Premises or
the Property to be deemed a "place of public accommodation" under the Americans
with Disabilities Act (the "ADA") as further described in the Building Rules
(defined below). All Common Areas shall be subject to Landlord's exclusive
control and management at all times. Tenant shall not use or permit the use of
any portion of the Common Areas for other than their intended use.
(b) Compliance. From and after the Commencement Date, Tenant shall comply
promptly, at its sole expense, (including making any alterations or
improvements) with all laws (including the ADA), ordinances, notices, orders,
rules, regulations and requirements regulating the Property during the Term
which impose any duty upon Landlord or Tenant with respect to Tenant's use,
occupancy or alteration of, or Tenant's installations in or upon, the Property
including the Premises, (as the same may be amended, the "LAWS AND
REQUIREMENTS") and the building rules attached as Exhibit "C" as amended by
Landlord from time to time (the "BUILDING RULES"). Provided, however, that
Tenant shall not be required to comply with the Laws and Requirements with
respect to the footings, foundations, structural steel columns and girders
forming a part of the Property unless the need for such compliance arises out of
Tenant's use, occupancy or alteration of the Property, or by any act or omission
of Tenant or any employees, agents, contractors, licensees or invitees
("AGENTS") of Tenant. With respect to Tenant's obligations as to the Property,
other than the Premises, at Landlord's option and at Tenant's expense. Landlord
may comply with any repair, replacement or other construction requirements of
the Laws and Requirements and Tenant shall pay to Landlord all costs thereof as
additional rent.
(c) Environmental. Tenant shall comply, at its sole expense, with all Laws
and Requirements as set forth above, all manufacturers' instructions and all
requirements of insurers relating to the treatment, production, storage,
handling, transfer, processing, transporting, use, disposal and release of
hazardous substances, hazardous mixtures, chemicals, pollutants, petroleum
products, toxic or radioactive matter (the "RESTRICTED ACTIVITIES"). Tenant
shall deliver to Landlord copies of all Material Safety Data Sheets or other
written information prepared by manufacturers, importers or suppliers of any
chemical and all notices filings permits and any other written communications
from or to Tenant and any entity regulating any Restricted Activities.
(d) Notice. If at any time during or after the Term; Tenant becomes aware
of any inquiry, investigation or proceeding regarding the Restricted Activities
or becomes aware of any claims, actions or investigations regarding the ADA;
Tenant shall give Landlord written notice, within 5 days after first learning
thereof, providing all available information and copies of any notices.
5. Term. The Term of this lease shall commence on the Commencement Date and
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shall end at 11:59 p.m. on the last day of the Term (the "EXPIRATION DATE"),
without the necessity for notice from either party, unless sooner terminated in
accordance with the terms hereof. At Landlord's request, Tenant shall confirm
the Commencement Date and Expiration Date by executing a lease commencement
certificate in the form attached as Exhibit "B".
6. Minimum Annual Rent. Tenant agrees to pay to Landlord the Minimum Annual Rent
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in equal monthly installments in the amount set forth in Section 1(d) (as
increased at the beginning of each lease year as set forth in Section 1(d)), in
advance, on the first day of each calendar month during the Term, without
notice, demand or setoff, at Landlord's address designated at the beginning of
this lease unless Landlord designates otherwise, provided that rent for the
first full month shall be paid at the signing of this lease. If the Commencement
Date falls on a day other than the first day of a calendar month, the rent shall
be apportioned pro rata on a per diem basis for the period from the Commencement
Date until the first day of the following calendar month and shall be paid on or
before the Commencement Date. As used in this lease, the term "lease year" means
the period from the Commencement Date
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through the succeeding 12 full calendar months (including for the first lease
year any partial month from the Commencement Date until the first day of the
first full calendar month) and each successive 12 month period thereafter during
the Term.
7. Operation of Property; Payment of Expenses.
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(a) Payment of Operating Expenses. Tenant shall pay to Landlord the Annual
Operating Expenses in equal monthly installments in the amount set forth in
Section 1(d) (prorated for any partial month), from the Commencement Date and
continuing throughout the Term on the first day of each calendar month during
the Term, as additional rent, without notice, demand or setoff provided that the
monthly installment for the first full month shall be paid at the signing of
this lease. Landlord shall apply such payments to the annual operating costs to
Landlord of operating and maintaining the Property during each calendar year of
the Term, which costs may include by way of example rather than limitation:
insurance premiums, fees, impositions, costs for repairs, maintenance, service
contracts, management and administrative fees, governmental permits, overhead
expenses, costs of furnishing water, sewer, gas, fuel, electricity, other
utility services, janitorial service, trash removal, security services,
landscaping and grounds maintenance, and the costs of any other items
attributable to operating or maintaining any or all of the Property excluding
any costs which under generally accepted accounting principles are capital
expenditures, provided, however, that annual operating costs also shall include
the annual amortization (over an assumed useful life of ten years) of the costs
(including financing charges) of building improvements made by Landlord to the
Property that are required by any governmental authority or for the purpose of
reducing operating expenses or directly enhancing the safety of tenants in the
Building generally. The amount of the Annual Operating Expenses set forth in
Section 1(d) represents Landlord's estimate of Tenant's share of the estimated
operating costs during the first calendar year of the Term on an annualized
basis, from time to time Landlord may adjust such estimated amount if the
estimated operating costs increase Tenant's obligation to pay the Annual
Operating Expenses pursuant to this Section 7 shall survive the expiration or
termination of this lease.
(i) Computation of Tenant's Share of Annual Operating Costs. After the
end of each calendar year of the Term, Landlord shall compute Tenant's
share of the annual operating costs described above incurred during such
calendar year by (A) calculating an appropriate adjustment, using generally
accepted accounting principles, to avoid allocating to Tenant or to any
other tenant (as the case may be) those specific costs which Tenant or any
other tenant has agreed to pay, (B) calculating an appropriate adjustment,
using generally accepted accounting principles, to avoid allocating to any
vacant space those specific costs which were not incurred for such space,
and (C) multiplying the adjusted annual operating costs by Tenant's
Proportionate Share.
(ii) Reconciliation. By April 30th of each year (and as soon as
practical after the expiration or termination of this lease or at any time
in the event of a sale of the Property), Landlord shall provide Tenant with
a statement of the actual amount of such annual operating costs for the
preceding calendar year or part thereof. Landlord or Tenant shall pay to
the other the amount of any deficiency or overpayment then due from one to
the other or at Landlord's option. Landlord may credit Tenant's account for
any overpayment. Tenant shall have the right to inspect the books and
records used by Landlord in calculating the annual operating costs within
60 days of receipt of the statement during regular business hours after
having given Landlord at least 48 hours prior written notice, provided,
however, that Tenant shall make all payments of additional rent without
delay, and that Tenant's obligation to pay such additional rent shall not
be contingent on any such right.
(b) Impositions. As used in this lease the term "impositions" refers to all
levies, taxes (including sales taxes and gross receipt taxes) and assessments,
which are applicable to the Term, and which are imposed by any authority or
under any law, ordinance or regulation thereof, or pursuant to any recorded
covenants or agreements, and the reasonable cost of contesting any of the
foregoing, upon or with respect to the Property or any part thereof, or any
improvements thereto. Tenant shall pay to Landlord with the monthly payment of
Minimum Annual Rent any imposition imposed directly upon this lease or the Rent
(defined in Section 7(g)) or amounts payable on any subtenants or other
occupants of the Premises, or against Landlord because of Landlord's estate or
interest herein.
(i) Nothing herein contained shall be interpreted as requiring Tenant
to pay any income, excess profits or corporate capital stock tax imposed or
assessed upon Landlord, unless such tax or any similar tax is levied or
assessed in lieu of all or any part of any imposition or an increase in any
imposition.
(ii) If it shall not be lawful for Tenant to reimburse Landlord for
any of the impositions, the Minimum Annual Rent shall be increased by the
amount of the portion of such imposition allocable to Tenant, unless
prohibited by law.
(c) Insurance.
(i) Property. Landlord shall keep in effect insurance against loss or
damage to the Building or the Property by fire and such other casualties as
may be included within fire, extended coverage and special form insurance
covering the full replacement
3
cost of the Building (but excluding coverage of Tenant's personal property
in, and any alterations by Tenant to, the Premises) and such other
insurance as Landlord may reasonably deem appropriate or as may be required
from time-to-time by any mortgagee.
(ii) Liability. Tenant, at its own expense, shall keep in effect
comprehensive general public liability insurance with respect to the
Premises and the Property, including contractual liability insurance, with
such limits of liability for bodily injury including death and property
damage as reasonably may be required by Landlord from time-to-time, but not
less than a combined single limit of $1,000,000 per occurrence and a
general aggregate limit of not less than $2,000,000 (which aggregate limit
shall apply separately to each of Tenant's locations if more than the
Premises); however, such limits shall not limit the liability of Tenant
hereunder. The policy of comprehensive general public liability insurance
also shall name Landlord and Landlord's agent as insured parties with
respect to the Premises, shall be written on an "occurrence" basis and not
on a "claims made" basis, shall provide that it is primary with respect to
any policies carried by Landlord and that any coverage carried by Landlord
shall be excess insurance, shall provide that it shall not be cancelable or
reduced without at least 30 days prior written notice to Landlord and shall
be issued in form satisfactory to Landlord. The insurer shall be a
responsible insurance carrier which is authorized to issue such insurance
and licensed to do business in the state in which the Property is located
and which has at all times during the Term a rating of no less than
A VII in the most current edition of Best's Insurance Reports. Tenant
shall deliver to Landlord on or before the Commencement Date, and
subsequently renewals of a certificate of insurance evidencing such
coverage and the waiver of subrogation described below
(iii) Waiver of Subrogation. Landlord and Tenant shall have included
in their respective property insurance policies waivers of their respective
insurers' right of subrogation against the other party. If such a waiver
should be unobtainable or unenforceable, then such policies of insurance
shall state expressly that such policies shall not be invalidated if,
before a casualty, the insured waives the right of recovery against any
party responsible for a casualty covered by the policy.
(iv) Increase of Premiums. Tenant agrees not to do anything or fail to
do anything which will increase the cost of Landlord's insurance or which
will prevent Landlord from procuring policies (including public liability)
from companies and in a form satisfactory to Landlord. If any breach of the
preceding sentence by Tenant causes the rate of fire or other insurance to
be increased, Tenant shall pay the amount of such increase as additional
rent promptly upon being billed.
(d) Repairs and Maintenance; Common Areas; Building Management.
(i) Tenant at its sole expense shall maintain the Premises in a neat
and orderly condition.
(ii) Landlord, shall make all necessary repairs to the Premises, the
Common Areas and any other improvements located on the Property provided
that Landlord shall have no responsibility to make any repair until
Landlord receives written notice of the need for such repair. Landlord
shall operate and manage the Property and shall maintain all Common Areas
and any paved areas appurtenant to the Property in a clean and orderly
condition. Landlord reserves the right to make alterations to the Common
Areas from time to time.
(iii) Notwithstanding anything herein to the contrary, repairs and
replacements to the Property including the Premises made necessary by
Tenant's use, occupancy or alteration of or Tenant's installation in or
upon the Property or by any act or omission of Tenant or its Agents shall
be made at the sole expense of Tenant to the extent not covered by any
applicable insurance proceeds paid to Landlord. Tenant shall not bear the
expense of any repairs or replacements to the Property arising out of or
caused by any other tenant's use, occupancy or alteration of or any other
tenant's installation in or upon, the Property or by any act or omission of
any other tenant or any other tenant's Agents.
(e) Utilities.
(i) Landlord will furnish the Premises with electricity, heating and
air conditioning for the normal use and occupancy of the Premises as
general offices between 8:00 a.m. and 6:00 p.m., Monday through Friday
(legal holidays excepted). If Tenant shall require electricity or install
electrical equipment including but not limited to electrical heating,
refrigeration equipment, electronic data processing machines, or machines
or equipment using current in excess of 110 volts, which will in any way
increase the amount of electricity usually furnished for use as general
office space, or if Tenant shall attempt to use the Premises in such a
manner that the services to be furnished by Landlord would be required
during periods other than or in addition to business hours referred to
above, Tenant will obtain Landlord's prior written approval and will pay
for the resulting additional direct expense, including the expense
resulting from the installation of such equipment and meters, as additional
rent promptly upon being billed. Landlord shall not be responsible or
liable for any interruption in utility service, nor shall such interruption
affect the continuation or validity of this lease.
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(ii) If at any time utility services supplied to the Premises are
separately metered, the cost of installing Tenant's meter and the cost of
such separately metered utility service shall be paid by Tenant promptly
upon being billed.
(f) Janitorial Services. Landlord will provide Tenant with trash removal
and janitorial services pursuant to a cleaning schedule attached as Exhibit "D".
(g) "Rent." The term "RENT" as used in this lease means the Minimum Annual
Rent, Annual Operating Expenses and any other additional rent or sums payable by
Tenant to Landlord pursuant to this lease, all of which shall be deemed rent for
purposes of Landlord's rights and remedies with respect thereto. Tenant shall
pay all Rent to Landlord within 30 days after Tenant is billed, unless otherwise
provided in this lease, and interest shall accrue on all sums due but unpaid.
8. Signs. Landlord, at Landlord's expense, will place Tenant's name and suite
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number on the Building standard sign and on or beside the entrance door to the
Premises. Except for signs which are located wholly within the interior of the
Premises and not visible from the exterior of the Premises, no signs shall be
placed on the Property without the prior written consent of Landlord. All signs
installed by Tenant shall be maintained by Tenant in good condition and Tenant
shall remove all such signs at the termination of this lease and shall repair
any damage caused by such installation, existence or removal.
9. Alterations and Fixtures.
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(a) Subject to Section 10. Tenant shall have the right to install its trade
fixtures in the Premises, provided that no such installation or removal thereof
shall affect any structural portion of the Property nor any utility lines,
communications lines, equipment or facilities in the Building serving any tenant
other than Tenant. At the expiration or termination of this lease and at the
option of Landlord or Tenant, Tenant shall remove such installation(s) and, in
the event of such removal, Tenant shall repair any damage caused by such
installation or removal; if Tenant, with Landlord's written consent, elects not
to remove such installation(s) at the expiration or termination of this lease,
all such installations shall remain on the Property and become the property of
Landlord without payment by Landlord.
(b) Except for non-structural changes which do not exceed $5000 in the
aggregate, Tenant shall not make or permit to be made any alterations to the
Premises without Landlord's prior written consent. Tenant shall pay the costs of
any required architectural engineering reviews. In making any alterations, (i)
Tenant shall deliver to Landlord the plans, specifications and necessary permits
together with certificates evidencing that Tenants contractors and
subcontractors have adequate insurance coverage naming Landlord and Landlord's
agent as additional insureds, at least 10 days prior to commencement thereof,
(ii) such alterations shall not impair the structural strength of the Building
or any other improvements or reduce the value of the Property or affect any
utility lines, communications lines, equipment or facilities in the Building
serving any tenant other than Tenant, (iii) Tenant shall comply with Section 10
and (iv) the occupants of the Building and of any adjoining property shall not
be disturbed thereby. All alterations to the Premises by Tenant shall be the
property of Tenant until the expiration or termination of this lease, at that
time all such alterations shall remain on the Property and become the property
of Landlord without payment by Landlord unless Landlord gives written notice to
Tenant to remove the same, in which event Tenant will remove such alterations
and repair any resulting damage. At Tenant's request prior to Tenant making any
alterations, Landlord shall notify Tenant in writing, whether Tenant is required
to remove such alterations at the expiration or termination of this lease.
10. Mechanics' Liens. Tenant shall pay promptly any contractors and materialmen
----------------
who supply labor, work or materials to Tenant at the Property and shall take all
steps permitted by law in order to avoid the imposition of any mechanic's lien
upon all or any portion of the Property. Should any such lien or notice of lien
be filed for work performed for Tenant other than by Landlord, Tenant shall bond
against or discharge the same within 5 days after Tenant has notice that the
lien or claim is filed regardless of the validity of such lien or claim. Nothing
in this lease is intended to authorize Tenant to do or cause any work to be done
or materials to be supplied for the account of Landlord, all of the same to be
solely for Tenant's account and at Tenant's risk and expense. Throughout this
lease the term "mechanic's lien" is used to include any lien, encumbrance or
charge levied or imposed upon all or any portion of interest in or income from
the Property on account of any mechanic's, laborer's, materialman's or
construction lien or arising out of any debt or liability to or any claim of any
contractor, mechanic, supplier, materialman or laborer and shall include any
mechanic's notice of intention to file a lien given to Landlord or Tenant, any
stop order given to Landlord or Tenant, any notice of refusal to pay naming
Landlord or Tenant and any injunctive or equitable action brought by any person
claiming to be entitled to any mechanic's lien
11. Landlord's Right to Relocate Tenant; Right of Entry.
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(a) Landlord may cause Tenant to relocate from the Premises to a comparable
space ("RELOCATION SPACE") within the Building by giving written notice to
Tenant at least 60 days in advance, provided that Landlord shall pay for all
reasonable costs of
5
such relocation. Such a relocation shall not terminate, modify or otherwise
affect this lease except that "Premises" shall refer to the Relocation Space
rather than the old location identified in Section 1(a).
(b) Tenant shall permit Landlord and its Agents to enter the Premises at
all reasonable times following reasonable notice (except in the event of an
emergency), for the purpose of inspection, maintenance or making repairs,
alterations or additions as well as to exhibit the Premises for the purpose of
sale or mortgage and, during the last 12 months of the Term, to exhibit the
Premises to any prospective tenant. Landlord will make reasonable efforts not to
inconvenience Tenant in exercising the foregoing rights but shall not be liable
for any loss of occupation or quiet enjoyment thereby occasioned.
12. Damage by Fire or Other Casualty.
--------------------------------
(a) If the Premises or Building shall be damaged or destroyed by fire or
other casualty, Tenant promptly shall notify Landlord and Landlord, subject to
the conditions set forth in this Section 12, shall repair such damage and
restore the Premises to substantially the same condition in which they were
immediately prior to such damage or destruction, but not including the repair,
restoration or replacement of the fixtures or alterations installed by Tenant.
Landlord shall notify Tenant in writing, within 30 days after the date of the
casualty if Landlord anticipates that the restoration will take more than 180
days from the date of the casualty to complete, in such event, either Landlord
or Tenant may terminate this lease effective as of the date of casualty by
giving written notice to the other within 10 days after Landlord's notice.
Further, if a casualty occurs during the last 12 months of the Term or any
extension thereof, Landlord may cancel this lease unless Tenant has the right to
extend the Term for at least 3 more years and does so within 30 days after the
date of the casualty.
(b) Landlord shall maintain a 12 month rental coverage endorsement or other
comparable form of coverage as part of its fire, extended coverage and special
form insurance. Tenant will receive an abatement of its Minimum Annual Rent and
Annual Operating Expenses to the extent the Premises are rendered untenantable
as determined by the carrier providing the rental coverage endorsement.
13. Condemnation.
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(a) Termination. If (i) all of the Premises are taken by a condemnation or
otherwise for any public or quasi-public use, (ii) any part of the Premises is
so taken and the remainder thereof is insufficient for the reasonable operation
of Tenants business or (iii) any of the Property is so taken, and, in Landlord's
opinion, it would be impractical or the condemnation proceeds are insufficient
to restore the remainder of the Property, then this lease shall terminate and
all unaccrued obligations hereunder shall cease as of the day before possession
is taken by the condemnor.
(b) Partial Taking. If there is a condemnation and this lease has not been
terminated pursuant to this Section, (i) Landlord shall restore the Building and
the improvements which area part of the Premises to a condition and size as
nearly comparable as reasonably possible to the condition and size thereof
immediately prior to the date upon which the condemnor took possession and (ii)
the obligations of Landlord and Tenant shall be unaffected by such condemnation
except that there shall be an equitable abatement of the Minimum Annual Rent
according to the rental value of the Premises before and after the date upon
which the condemnor took possession and/or the date Landlord completes such
restoration.
(c) Award. In the event of a condemnation affecting Tenant, Tenant shall
have the right to make a claim against the condemnor for moving expenses and
business dislocation damages to the extent that such claim does not reduce the
sums otherwise payable by the condemnor to Landlord. Except as aforesaid and
except as set forth in (d) below, Tenant hereby assigns all claims against the
condemnor to Landlord.
(d) Temporary Taking. No temporary taking of the Premises shall terminate
this lease or give Tenant any right to any rental abatement. Such a temporary
taking will be treated as if Tenant had sublet the Premises to the condemnor and
had assigned the proceeds of the subletting to Landlord to be applied on account
of Tenant's obligations hereunder. Any award for such a temporary taking during
the Term shall be applied first, to Landlord's costs of collection and, second,
on account of sums owing by Tenant hereunder, and if such amounts applied on
account of sums owing by Tenant hereunder should exceed the entire amount owing
by Tenant for the remainder of the Term, the excess will be paid to Tenant.
14. Non-Abatement of Rent. Except as otherwise expressly provided as to damage
---------------------
by fire or other casualty in Section l2(b) and as to condemnation in Section
13(b), there shall be no abatement or reduction of the Rent for any cause
whatsoever, and this lease shall not terminate, and Tenant shall not be entitled
to surrender the Premises.
15. Indemnification of Landlord. Subject to Sections 7(c)(iii) and 16, Tenant
---------------------------
will protect, indemnify and hold harmless Landlord and its Agents from and
against any and all claims, actions, damages, liability and expense (including
fees of attorneys, investigators
6
and experts) in connection with loss of life, personal injury or damage to
property in or about the Premises or arising out of the occupancy or use of the
Premises by Tenant or its Agents or occasioned wholly or in part by any act or
omission of Tenant or its Agents, whether prior to, during or after the Term,
except to the extent such loss, injury or damage was caused by the negligence of
Landlord or its Agents. In case any action or proceeding is brought against
Landlord and/or its Agents by reason of the foregoing, Tenant, at its expense,
shall resist and defend such action or proceeding, or cause the same to be
resisted and defended by counsel (reasonably acceptable to Landlord and its
Agents) designated by the insurer whose policy covers such occurrence or by
counsel designated by Tenant and approved by Landlord and its Agents. Tenant's
obligations pursuant to this Section 15 shall survive the expiration or
termination of this lease.
16. Waiver of Claims. Landlord and Tenant each hereby waives all claims for
----------------
recovery against the other for any loss or damage which may be inflicted upon
the property of such party even if such loss or damage shall be brought about by
the fault or negligence of the other party or its Agents, provided, however,
that such waiver by Landlord shall not be effective with respect to any
liability of Tenant described in Sections 4(c) and 7(d)(iii).
17. Quiet Enjoyment. Landlord covenants that Tenant, upon performing all of its
---------------
covenants, agreements and conditions of this lease shall have quiet and peaceful
possession of the Premises as against anyone claiming by or through Landlord,
subject, however, to the exceptions, reservations and conditions of this lease.
18. Assignment and Subletting.
-------------------------
(a) Limitation. Tenant shall not transfer this lease, voluntarily or by
operation of law, without the prior written consent of Landlord which shall not
be withheld unreasonably. However, Landlord's consent shall not be required in
the event of any transfer by Tenant to an affiliate of Tenant which is at least
as creditworthy as Tenant as of the date of this lease and provided Tenant
delivers to Landlord the instrument described in Section (c)(iii) below,
together with a certification of such creditworthiness by Tenant and such
affiliate. Any transfer not in conformity with this Section l8 shall be void at
the option of Landlord, and Landlord may exercise any or all of its rights under
Section 23. A consent to one transfer shall not be deemed to be a consent to any
subsequent transfer. "Transfer" shall include any sublease, assignment, license
or concession agreement, change in ownership or control of Tenant, mortgage or
hypothecation of this lease or Tenant's interest therein or in all or a portion
of the Premises.
(b) Offer to Landlord. Tenant acknowledges that the terms of this lease,
including the Minimum Annual Rent have been based on the understanding that
Tenant physically shall occupy the Premises for the entire Term. Therefore, upon
Tenant's request to transfer all or a portion of the Premises, at the option of
Landlord, Tenant and Landlord shall execute an amendment to this lease removing
such space from the Premises. Tenant shall be relieved of any liability with
respect to such space and Landlord shall have the right to lease such space to
any party, including Tenant's proposed transferee.
(c) Conditions. Notwithstanding the above, the following shall apply to any
transfer, with or without Landlord's consent
(i) As of the date of any transfer, Tenant shall not be in default
under this lease nor shall any act or omission have occurred which would
constitute a default with the giving of notice and/or the passage of time.
(ii) No transfer shall relieve Tenant of its obligation to pay the
Rent and to perform all its other obligations hereunder. The acceptance of
Rent by Landlord from any person shall not be deemed to be a waiver by
Landlord of any provision of this lease or to be a consent to any transfer.
(iii) Each transfer shall be by a written instrument in form and
substance satisfactory to Landlord which shall (A) include an assumption of
liability by any transferee of all Tenant's obligations and the
transferee's ratification of and agreement to be bound by all the
provisions of this lease, (B) afford Landlord the right of direct action
against the transferee pursuant to the same remedies as are available to
Landlord against Tenant and (C) be executed by Tenant and the transferee.
(iv) Tenant shall pay, within 10 days of receipt of an invoice which
shall be no less than $250, Landlord's reasonable attorneys' fees and costs
in connection with the review, processing and documentation of any transfer
for which Landlord's consent is requested.
19. Subordination; Mortgagee's Rights.
---------------------------------
(a) This lease shall be subordinate to any first mortgage or other primary
encumbrance now or hereafter affecting the Premises. Although the subordination
is self-operative, within 10 days after written request, Tenant shall execute
and deliver any further instruments confirming such subordination of this lease
and any further instruments of attornment that may be desired by any such
mortgagee or Landlord. However, any mortgagee may at any time subordinate its
mortgage to this lease, without Tenant's consent,
7
by giving written notice to Tenant, and thereupon this lease shall be deemed
prior to such mortgage without regard to their respective dates of execution and
delivery; provided however, that such subordination shall not affect any
mortgagee's rights to condemnation awards, casualty insurance proceeds,
intervening liens or any right which shall arise between the recording of such
mortgage and the execution of this lease.
(b) It is understood and agreed that any mortgagee shall not be liable to
Tenant for any funds paid by Tenant to Landlord unless such funds actually have
been transferred to such mortgagee by Landlord
(c) Notwithstanding the provisions of Sections 12 and 13 above, Landlord's
obligation to restore the Premises after a casualty or condemnation shall be
subject to the consent and prior rights of Landlord's first mortgagee.
20. Recording; Tenant's Certificate. Tenant shall not record this lease or a
-------------------------------
memorandum thereof without Landlord's prior written consent. Within 10 days
after Landlord's written request from time to time:
(a) Tenant shall execute, acknowledge and deliver to Landlord a written
statement certifying the Commencement Date and Expiration Date of this lease,
that this lease is in full force and effect and has not been modified and
otherwise as set forth in the form of estoppel certificate attached as Exhibit
"E" or with such modifications as may be necessary to reflect accurately the
stated facts and/or such other certifications as may be requested by a mortgagee
or purchaser. Tenant understands that its failure to execute such documents may
cause Landlord serious financial damage by causing the failure of a financing or
sale transaction.
(b) Tenant shall furnish to Landlord, Landlord's mortgagee, prospective
mortgagee or purchaser reasonably requested financial information.
21. Surrender; Abandoned Property.
-----------------------------
(a) Subject to the terms of Sections 9(b), 12(a) and 13(b), at the
expiration or termination of this lease, Tenant promptly shall yield up in the
same condition, order and repair in which they are required to be kept
throughout the Term, the Premises and all improvements thereto, and all fixtures
and equipment servicing the Building, ordinary wear and tear excepted.
(b) Upon or prior to the expiration or termination of this lease, Tenant
shall remove any personal property from the Property. Any personal property
remaining thereafter shall be deemed conclusively to have been abandoned, and
Landlord, at Tenant's expense, may remove, store, sell or otherwise dispose of
such property in such manner as Landlord may see fit and/or Landlord may retain
such property as its property. If any part thereof shall be sold, then Landlord
may receive and retain the proceeds of such sale and apply the same, at its
option, against the expenses of the sale, the cost of moving and storage and any
Rent due under this lease.
(c) If Tenant, or any person claiming through Tenant, shall continue to
occupy the Premises after the expiration or termination of this lease or any
renewal thereof, such occupancy shall be deemed to be under a month-to-month
tenancy under the same terms and conditions set forth in this lease, except that
the monthly installment of the Minimum Annual Rent during such continued
occupancy shall be double the amount applicable to the last month of the Term.
Anything to the contrary notwithstanding, any holding over by Tenant without
Landlord's prior written consent shall constitute a default hereunder and shall
be subject to all the remedies available to Landlord.
22. Curing Tenant's Defaults. If Tenant shall be in default in the performance
------------------------
of any of its obligations hereunder, Landlord, without any obligation to do so,
in addition to any other rights it may have in law or equity, may elect to cure
such default on behalf of Tenant after written notice (except in the case of
emergency) to Tenant. Tenant shall reimburse Landlord upon demand for any sums
paid or costs incurred by Landlord in curing such default, including interest
thereon from the respective dates of Landlord's incurring such costs, which sums
and costs together with interest shall be deemed additional rent.
23. Defaults - Remedies.
-------------------
(a) Defaults. It shall be an event of default
(i) If Tenant does not pay in full when due any and all Rent;
(ii) If Tenant fails to observe and perform or otherwise breaches any
other provision of this lease;
8
(iii) If Tenant abandons the Premises, which shall be conclusively
presumed if the Premises remain unoccupied for more than 10 consecutive
days, or removes or attempts to remove Tenant's goods or property other
than in the ordinary course of business, or
(iv) If Tenant becomes insolvent or bankrupt in any sense or makes a
general assignment for the benefit of creditors or offers a settlement to
creditors, or if a petition in bankruptcy or for reorganization or for an
arrangement with creditors under any federal or state law is filed by or
against Tenant, or a xxxx in equity or other proceeding for the appointment
of a receiver for any of Tenant's assets is commenced, or if any of the
real or personal property of Tenant shall be levied upon, provided
however, that any proceeding brought by anyone other than Landlord or
Tenant under any bankruptcy, insolvency, receivership or similar law
shall not constitute a default until such proceeding has continued unstayed
for more than 60 consecutive days.
(b) Remedies. Then, and in any such event, Landlord shall have the
following rights:
(i) To charge a late payment fee equal to the greater of $100 or 5% of
any amount owed to Landlord pursuant to this lease which is not paid within
5 days after the due date.
(ii) To enter and repossess the Premises, by breaking open locked
doors if necessary, and remove all persons and all or any property
therefrom, by action at law or otherwise, without being liable for
prosecution or damages therefor, and Landlord may, at Landlord's option,
make alterations and repairs in order to relet the Premises and relet all
or any part(s) of the Premises for Tenant's account. Tenant agrees to pay
to Landlord on demand any deficiency that may arise by reason of such
reletting. In the event of reletting without termination of this lease,
Landlord may at any time thereafter elect to terminate this lease for such
previous breach.
(iii) To accelerate the whole or any part of the Rent for the balance
of the Term, and declare the same to be immediately due and payable.
(iv) To terminate this lease and the Term without any right on the
part of Tenant to save the forfeiture by payment of any sum due or by other
performance of any condition, term or covenant broken.
(c) Grace Period. Notwithstanding anything hereinabove stated, neither
party will exercise any available right because of any default of the other,
except those remedies contained in subsection (b)(i) of this Section, unless
such party shall have first given 10 days written notice thereof to the
defaulting party, and the defaulting party shall have failed to cure the default
within such period, provided, however, that:
(i) No such notice shall be required if Tenant fails to comply with
the provisions of Sections 10 or 20(a), in the case of emergency as set
forth in Section 22 or in the event of any default enumerated in
subsections (a)(iii) and (iv) of this Section.
(ii) Landlord shall not be required to give such 10 days notice more
than 2 times during any 12 month period.
(iii) If the default consists of something other than the failure to
pay money which cannot reasonably be cured within 10 days, neither party
will exercise any right if the defaulting party begins to cure the default
within the 10 days and continues actively and diligently in good faith to
completely cure said default.
(iv) Tenant agrees that any notice given by Landlord pursuant to this
Section which is served in compliance with Section [ILLEGIBLE] shall be
adequate notice for the purpose of Landlord's exercise of any available
remedies.
(d) Non-Waiver: Non-Exclusive. No waiver by Landlord of any breach by
Tenant shall be a waiver of any subsequent breach, nor shall any forbearance by
Landlord to seek a remedy for any breach by Tenant be a waiver by Landlord of
any rights and remedies with respect to such or any subsequent breach. Efforts
by Landlord to mitigate the damages caused by Tenant's default shall not
constitute a waiver of Landlords right to recover damages hereunder. No right
or remedy herein conferred upon or reserved to Landlord is intended to be
exclusive of any other right or remedy provided herein or by law, but each shall
be cumulative and in addition to every other right or remedy given herein or now
or hereafter existing at law or in equity. No payment by Tenant or receipt or
acceptance by Landlord of a lesser amount than the total amount due Landlord
under this lease shall be deemed to be other than on account, nor shall any
endorsement or statement on any check or payment be deemed an accord and
satisfaction, and Landlord may accept such check or payment without prejudice to
Landlord's right to recover the balance of Rent due, or Landlord's right to
pursue any other available remedy.
9
(e) Cost and Attorneys' Fees. If either party commences an action against
the other party arising out of or in connection with this lease, the prevailing
party shall be entitled to have and recover from the losing party attorneys'
fees, costs of suit, investigation expenses and discovery costs, including costs
of appeal.
24. Representations of Tenant. Tenant represents to Landlord and agrees that:
-------------------------
(a) The word "Tenant" as used herein includes the Tenant named above as
well as its successors and assigns, each of which shall be under the same
obligations and liabilities and each of which shall have the same rights,
privileges and powers as it would have possessed had it originally signed this
lease as Tenant. Each and every of the persons named above as Tenant shall be
bound jointly and severally by the terms, covenants and agreements contained
herein. However, no such rights, privileges or powers shall inure to the benefit
of any assignee of Tenant immediate or remote, unless Tenant has complied with
the terms of Section 18 and the assignment to such assignee is permitted or has
been approved in writing by Landlord. Any notice required or permitted by the
terms of this lease may be given by or to any one of the persons named above as
Tenant, and shall have the same force and effect as if given by or to all
thereof.
(b) If Tenant is a corporation, partnership or any other form of business
association or entity. Tenant is duly formed and in good standing, and has full
corporate or partnership power and authority, as the case may be, to enter into
this lease and has taken all corporate or partnership action, as the case may
be, necessary to carry out the transaction contemplated herein, so that when
executed, this lease constitutes a valid and binding obligation enforceable in
accordance with its terms. Tenant shall provide Landlord with corporate
resolutions or other proof in a form acceptable to Landlord, authorizing the
execution of this lease at the time of such execution.
25. Liability of Landlord. The word "Landlord" as used herein includes the
---------------------
Landlord named above as well as its successors and assigns, each of which shall
have the same rights, remedies, powers, authorities and privileges as it would
have had it originally signed this lease as Landlord. Any such person or entity,
whether or not named herein, shall have no liability hereunder after it ceases
to hold title to the Premises except for obligations already accrued (and, as to
any unapplied portion of Tenant's Security Deposit, Landlord shall be relieved
of all liability therefor upon transfer of such portion to its successor in
interest) and Tenant shall look solely to Landlord's successor in interest for
the performance of the covenants and obligations of the Landlord hereunder which
thereafter shall accrue. Neither Landlord nor any principal of Landlord nor any
owner of the Property, whether disclosed or undisclosed, shall have any personal
liability with respect to any of the provisions of this lease or the Premises,
and if Landlord is in breach or default with respect to Landlord's obligations
under this lease or otherwise, Tenant shall look solely to the equity of
Landlord in the Property for the satisfaction of Tenant's claims.
Notwithstanding the foregoing, no mortgagee or ground lessor succeeding to the
interest of Landlord hereunder (either in terms of ownership or possessory
rights) shall be (a) liable for any previous act or omission of a prior
landlord, (b) subject to any rental offsets or defenses against a prior landlord
or (c) bound by any amendment of this lease made without its written consent, or
by payment by Tenant of Minimum Annual Rent in advance in excess of one monthly
installment.
26. Interpretation; Definitions.
---------------------------
(a) Captions. The captions in this lease are for convenience only and are
not a part of this lease and do not in any way define, limit, describe or
amplify the terms and provisions of this lease or the scope or intent thereof.
(b) Entire Agreement. This lease represents the entire agreement between
the parties hereto and there are no collateral or oral agreements or
understandings between Landlord and Tenant with respect to the Premises or the
Property. No rights, easements or licenses are acquired in the Property or any
land adjacent to the Property by Tenant by implication or otherwise except as
expressly set forth in the provisions of this lease. This lease shall not be
modified in any manner except by an instrument in writing executed by the
parties. The masculine (or neuter) pronoun and the singular number shall include
the masculine, feminine and neuter genders and the singular and plural number.
The word "including" followed by any specific item(s) is deemed to refer to
examples rather than to be words of limitation. Both parties having participated
fully and equally in the negotiation and preparation of this lease, this lease
shall not be more strictly construed, nor any ambiguities in this lease
resolved, against either Landlord or Tenant.
(c) Covenants. Each covenant, agreement, obligation, term, condition or
other provision herein contained shall be deemed and construed as a separate and
independent covenant of the party bound by, undertaking or making the same, not
dependent on any other provision of this lease unless otherwise expressly
provided. All of the terms and conditions set forth in this lease shall apply
throughout the Term unless otherwise expressly set forth herein.
(d) Interest. Wherever interest is required to be paid hereunder, such
interest shall be at the highest rate permitted under law but not in excess of
15% per annum.
10
(e) Severability; Governing Law. If any of this lease shall be declared
unenforceable in any respect, such unenforceabilty shall not affect any other
provision of this lease, and each such provision shall be deemed to be modified,
if possible, in such a manner as to render it enforceable and to preserve to the
extent possible the intent of the parties as set forth herein. This lease shall
be construed and enforced in accordance with the laws of the state in which the
Property is located.
(f) "Mortgage and "Mortgagee" The word "mortgage" as used herein Includes
any lien or encumbrance on the Premises or the Property or on any party of or
interest in or appurtenance to any of the foregoing, Including without
limitation ground rent or ground lease if Landlord's interest is or becomes a
leasehold estate. The word "mortgagee" as used herein Includes the holder of any
mortgage, Including any ground lessor if Landlord's interest is or becomes a
leasehold estate. Wherever any right is given to a mortgage, that right may be
exercised on behalf of such mortgagee by any representative or servicing agent
of such mortgagee.
(g) "Person" The word "person" is used herein to Include a natural person,
partnership, a corporation, an association and any other form of business
association or entity.
27. Notices. Any notice or other communications under this lease shall be in
-------
writing and addressed to Landlord or Tenant at their respective addresses
specified at the beginning of this lease, except that after the Commencement
Date Tenant's address shall be at the Premises, (or to such other address as
either may designate by notice to the other) with a copy to any mortgagee or
other party designated by Landlord. Each notice or other communication shall be
deemed given if sent by prepaid overnight delivery service or by certified mail,
return receipt requested, postage prepaid or in any other manner, with delivery
in any case evidenced by a receipt, and shall be deemed received on the day of
actual receipt by the intended recipient or on the business day delivery is
refused. The giving of notice by Landlord's attorneys, representatives and
agents under this Section shall be deemed to be the acts of Landlord; however,
the foregoing provisions governing the date on which a notice deemed to have
been received shall mean and refer to the date on which a party to this lease,
and not its counsel or other recipient to which a copy of the notice may be
sent, is deemed to have received the notice.
28. Security Deposit. At the time of signing this lease, Tenant shall deposit
----------------
with Landlord the Security Deposit to be retained by Landlord as cash security
for the faithful performance and observance by Tenant of the provisions of this
lease. Tenant shall not be entitled to any interest whatever on the Security
Deposit. Landlord shall have the right to commingle the Security Deposit with
its other funds. Landlord may use the whole or any part of the Security Deposit
for the payment of any amount as to which Tenant is in default thereunder or to
compensate Landlord for any loss or damage it may suffer by reason of Tenant's
default under this lease. If Landlord uses all or any portion of the Security
Deposit as herein provided, within 10 days after written demand therefor, Tenant
shall pay Landlord cash in amount equal to that portion of the Security Deposit
used by Landlord. If Tenant shall comply fully and faithfully with all the
provisions of this lease, the Security Deposit shall be returned to Tenant after
the Expiration Date and surrender of the Premises to Landlord.
IN WITNESS WHEREOF, and in consideration of the mutual entry into this
lease and for other good and valuable consideration, and intending to be legally
bound, Landlord and Tenant have executed this lease.
Landlord:
LIBERTY PROPERTY LIMITED PARTNERSHIP
Date Signed: By: Liberty Property Trust, Sole General Partner
5/15/99
-------------------- By: /s/ Xxxx X. Xxxxxxxxxx
--------------------------------------------
Xxxx X. Xxxxxxxxxx, Senior Vice President
Tenant:
Date Signed: VerticalNet, Inc.
4/21/99
-------------------- By: /s/ Xxxx X. Xxxxxx
--------------------------------------------
Name: Xxxx X. Xxxxxx
Title: VP Finance & CFO
Attest:
----------------------------
Name:
----------------------------
Title: [Corporate Seal]
----------------------------
11
RIDER
29. PA Additional Remedies.
----------------------
(a) When this lease and the Term or any extension thereof shall have been
terminated on account of any default by Tenant, which remains uncured after the
expiration of any applicable notice and/or cure period, or when the Term or any
extension thereof shall have expired, Tenant hereby authorizes any attorney of
any court of record of the Commonwealth of Pennsylvania to appear for Tenant and
for anyone claiming by, through or under Tenant and to confess judgment against
all such parties, and in favor of Landlord, in ejectment and for the recovery of
possession of the Premises, for which this lease or a true and correct copy
hereof shall be good and sufficient warrant. AFTER THE ENTRY OF ANY SUCH
JUDGMENT A WRIT OF POSSESSION MAY BE ISSUED THEREON WITHOUT FURTHER NOTICE TO
TENANT AND WITHOUT A HEARING. If for any reason after such action shall have
been commenced it shall be determined and possession of the Premises remain in
or be restored to Tenant. Landlord shall have the right for the same default and
upon any subsequent default(s) or upon the termination of this lease or Tenant's
right of possession as herein set forth, to again confess judgment as herein
provided, for which this lease or a true and correct copy hereof shall be good
and sufficient warrant.
(b) The warrant to confess judgment set forth above shall continue in full
force and effect and be unaffected by amendments to this lease or other
agreements between Landlord and Tenant even if any such amendments or other
agreements increase Tenant's obligations or expand the size of the Premises.
Tenant waives any procedural errors in connection with the entry of any such
judgment or in the issuance of any one or more writs of possession or execution
or garnishment thereon.
(c) EXCEPT AS OTHERWISE SET FORTH IN THIS LEASE, TENANT KNOWINGLY AND
EXPRESSLY WAIVES ANY RIGHT, INCLUDING, WITHOUT LIMITATION, UNDER ANY APPLICABLE
STATUTE, WHICH TENANT MAY HAVE TO RECEIVE A NOTICE TO QUIT PRIOR TO LANDLORD
COMMENCING AN ACTION FOR REPOSSESSION OF THE PREMISES.
Initials on behalf
of Tenant:
1
30. Base Building Improvements; Tenant Improvements.
-----------------------------------------------
(a) Defined Terms. The terms set forth in the Summary of Terms and Certain
-------------
Definitions (on page 1 hereof) notwithstanding, the date set forth in Section
1(c)(i) is defined as the "COMPLETION DATE" and the "COMMENCEMENT DATE" is the
date set forth in subsection (i) below.
(b) Base Building Improvements. Landlord shall construct and complete, at
--------------------------
its sole cost and expense, improvements to the Building and the Property set
forth on the Scope of Work attached hereto as Exhibit "F" (the "Base Building
Improvements"). Landlord shall perform the Base Building Improvements in a good
and workmanlike manner pursuant to duly authorized and issued permits and
approvals and the Base Building Improvements shall comply at the time of
completion with all Laws and Requirements of the governmental authorities having
jurisdiction which are applicable to such construction.
(c) Tenant Improvements. Landlord shall, at its sole cost and expense,
-------------------
subject to reimbursement as set forth in subsection (g) below, construct and
complete the Premises ("Landlord's Work") in accordance with the plans attached
hereto as Exhibit "G" (herein called the "Plans") and specifications attached
hereto as Exhibit "H" (herein called the "Specifications"). Landlord's Work
shall be performed in a good and workmanlike manner pursuant to duly authorized
and issued permits and approvals and shall comply at the time of completion with
all law's and requirements of the governmental authorities having jurisdiction
which are applicable to such construction.
(d) Tenant Changes in Plans and Specifications. Tenant shall have the
------------------------------------------
right, from time to time after the approval of the Plans and the Specifications,
to make changes in and to improvements shown thereon, provided, however, that
Landlord shall have the right to withhold its approval of changes requested by
Tenant which, in Landlord's reasonable judgment, (i) conflict with applicable
provisions of law or any covenants or restrictions applicable to the Property,
or (ii) would render the Premises materially more difficult to relet upon
termination of this lease, or (iii) require structural changes. Any such changes
shall be confirmed by written change order signed by Landlord and Tenant as set
forth in subsection (i) below, which shall confirm any delay caused by such
changes. Any delay in substantial completion of Landlord's Work as a result of
any such changes shall constitute a Tenant Delay (as hereinafter defined).
(e) Landlord Changes in Plans and Specifications. Landlord shall have the
--------------------------------------------
right from time to time, after the approval of the Plans and the Specifications,
to make reasonable and non-material changes in and to the same in each instance,
to the extent that the same shall be reasonably necessary:
(i) in connection with Landlord's construction of the Premises,
including without limitation, replacing then unavailable specified
materials with materials of equivalent or better quality, provided,
however, that Landlord shall make no changes to the finishes of the
Premises or changes which would increase the Cost of the Construction (as
hereinafter defined) or affect the operation of the Premises for the Use
without the prior written consent of Tenant; and/or
2
(ii) in order to cause Landlord's Work to comply with any applicable
requirements of public authorities and/or requirements of insurance bodies.
Any changes made by Landlord pursuant to this subsection shall not increase the
Cost of Construction nor deviate from the intended result of the Plans and
Specifications.
(f) Construction. All construction shall be commenced promptly by Landlord
------------
and shall be substantially completed and ready for use and occupancy by Tenant
on the Completion Date. The time for substantial completion of the Premises
shall be extended for additional periods of time equal to the time actually lost
by Landlord or Landlord's contractors, subcontractors or suppliers due to Change
Orders, Tenant Delays (as hereinafter defined), strikes or other labor troubles,
governmental restrictions and limitations, scarcity, unavailability or delays in
obtaining fuel, labor or materials, war or other national emergency, accidents,
floods, defective materials, fire damage or other casualties, adverse weather
conditions, or any cause similar or dissimilar to the foregoing beyond the
reasonable control of Landlord or Landlord's contractors, subcontractors or
suppliers (collectively "Excusable Delays"), provided that in each instance
Landlord shall have notified Tenant promptly upon learning of such occurrence or
the reasonable likelihood thereof and the length of the anticipated delay.
(g) Cost of Construction. As used herein, the term "Cost of Construction"
--------------------
shall mean and refer to the following costs, expenses and fees incurred by or on
behalf of Landlord in connection with Landlord's Work: (i) architectural,
engineering and design costs, (ii) the cost charged to Landlord by Landlord's
general contractor and all subcontractors for performing such construction, and
(iii) the actual cost to Landlord of performing directly any portion of such
construction. Landlord has heretofore competitively bid Landlord's Work to three
general contractors and, with Tenant's consent, has selected Xxxxxxx
Construction as Landlord's general contractor.
When Landlord's Work has been substantially completed, the Cost of
Construction will be totaled. If such total (the "Total") exceeds an allowance
(the "Allowance") of $25.00 per rentable square foot for the first 45,000 square
feet of the Premises plus $10.00 per rentable square foot for the remaining
13,863 square feet of the Premises for a total Allowance of $1,263,630 ("Excess
Cost"), the amount of the Excess Cost shall be due and payable by Tenant to
Landlord within thirty (30) days after Tenant's receipt of Landlord's
computation of the Total, together with reasonable supporting backup
documentation, and a xxxx for the Excess Cost. Such payment shall be due as
Additional Rent, hereunder.
If the Total is less than the Allowance (a "Cost Decrease"), Tenant's
Minimum Annual Rent obligation throughout the Term shall decrease by $0.1619 per
year for each $1.00 of the Cost Decrease, to be apportioned for amounts of such
Cost Decrease which are less than $1.00.
In no event shall the Total exceed $1,435,409 unless due to changes
pursuant to subsections 30(d), 30(e) or 30(i)(ii).
(h) Acceptance of Premises. Section 3 of the Lease is deleted and restated
----------------------
as follows:
3
"Landlord represents to Tenant that the Property is zoned BC (Business
Campus District). Tenant has been given the opportunity to examine Township's
Zoning Code, and has satisfied itself that such Code will permit the use of the
Property for the conducting of Tenant's business thereon. Tenant's acceptance of
occupancy of the Premises shall, subject to such obligations as are assumed by
Landlord hereunder, and subject to Landlord's warranty obligations as
hereinafter described, constitute Tenant's acceptance of the work which Landlord
is required to perform pursuant to subsection 30(c), and any schedule or exhibit
in this lease, excepting only items listed on the Punch List (as hereinafter
defined). Tenant and its agents shall have the right, at Tenant's own risk,
expense, and responsibility, at all reasonable times prior to the Commencement
Date, upon reasonable prior notice to Landlord, to enter the Premises for the
purpose of taking measurements and installing its furnishings and equipment;
provided that Tenant does not interfere with or delay the work to be performed
by Landlord and Tenant uses contractors and workers compatible with the
contractors and workers engaged by Landlord.
At or immediately prior to the time Tenant takes occupancy of the Premises,
a representative of Landlord and a representative of Tenant will perform a
walk-through inspection of the Premises and will prepare a punch list, if one is
required, of any items remaining to be completed, furnished, repaired, or
replaced ("Punch List"). Such Punch List will be signed by a representative of
Landlord and a representative of Tenant. Landlord agrees to cause all items
listed on the Punch List to be performed within thirty (30) days or such longer
period as shall be reasonably required in order to complete such items with
reasonable diligence."
(i) Term. Section 5 of the Lease is deleted and restated as follows:
----
"(i) The Term of this Lease shall commence on the earlier of (A) the
date of substantial completion (as hereinafter defined) of the improvements
to be constructed by Landlord under subsection 30(c), or (B) the date
Tenant first uses the Premises for the conduct of Tenant's business (the
"COMMENCEMENT DATE") and shall end at 11:59 P.M. on the last day of the
Term (the "EXPIRATION DATE"), without the necessity for notice from either
party, unless extended pursuant to the terms of this Lease, or sooner
terminated in accordance with the terms hereof. Landlord shall confirm the
Commencement Date and the Expiration Date by executing and delivering to
Tenant a Lease Commencement Certificate in the form attached as Exhibit
"B". In the event Tenant disagrees with the Commencement Date and the
Expiration Date set forth in the Lease Commencement Certificate, Tenant
shall notify Landlord in writing of its objection thereto, setting forth
the basis for Tenant's objection. If no written objection to the Lease
Commencement Certificate is received by Landlord within 10 days after
Tenant's receipt of the Lease Commencement Certificate, the Commencement
Date and the Expiration Date set forth in the Lease Commencement
Certificate shall be conclusively deemed to be accurate.
If and to the extent that the date of substantial completion of the
Premises is delayed as a result of a Tenant Delay (as hereinafter defined), the
Term of this lease and the Commencement Date (for all purposes other than
Tenant's right to occupy the Premises) and Tenant's obligation to pay rent for
the Premises shall commence as of the date the Premises would have been
substantially complete but for such Tenant Delays.
(ii) As used in this lease, the term "Tenant Delay" shall mean any:
4
(A) If a Change Order is signed by both Landlord and Tenant, the
Change Delay stated therein; or if a request for a Change Order is not
signed by both Landlord and Tenant, any actual delay resulting from
Landlord's evaluation of Tenant's Change Order request, and any actual
delay caused by a work stoppage required in connection with a review
of Tenant's request for a Change Order; provided that in no case where
a Change Order is not signed shall Tenant be charged with any such
delay unless Landlord has given Tenant prior notice that Landlord's
review of Tenant's Change Order request will cause such delay; and
(B) Actual delays caused by any of Tenant's installation or
construction work or Tenant's physical conduct at the Premises
actually interfering with the progress of Landlord's Work.
The Premises will be deemed substantially complete when Landlord's
independent architect shall certify to Tenant that (i) all work which Landlord
is required to perform pursuant to subsection 30(c) has been satisfactorily
completed (subject only to completion of items set forth on the Punch List),
(ii) the HVAC, fire protection, electrical systems and all other building
systems shall be in proper working order and functioning (subject to adjustment
for seasonal conditions) in accordance with design standards set forth herein,
the exhibits hereto or the Plans and Specifications, (iii) safe access to and
egress from all parking areas shall be provided, and (iv) all requisite township
and state certificates of occupancy shall have been delivered by Landlord to
Tenant, and Tenant shall be able to take occupancy of the Premises and fully use
and enjoy the Premises for the conduct of its business thereon. The foregoing
notwithstanding, the Premises shall not be deemed other than substantially
complete by reason of(a) a punch list, if any, of minor items remaining to be
completed, furnished, repaired, or replaced, (b) the issuance of only a
temporary certificate of occupancy by the township, provided that all conditions
to the issuance of all final certificates (or other permits) required for
Tenant's lawful occupancy shall be issued in the ordinary course without the
satisfaction of any further conditions (including the payment of money or the
performance of any work), and provided, further, that if any further conditions
remain to be satisfied, then Landlord shall follow-up with all due dispatch to
cause the issuance of final certificates of occupancy without expense to Tenant
or any interference with Tenant's use and enjoyment of the Premises. In
addition, the Premises shall not be deemed other than substantially complete by
reason of Landlord's failure at the time of substantial completion to deliver a
final certificate of occupancy from the Commonwealth of Pennsylvania Department
of Labor and Industry, provided that Tenant shall be permitted to assume lawful
occupancy of the Premises pending the issuance thereof, and provided, further,
that if any further conditions remain to be satisfied for the issuance thereof
then anything in this Lease contained to the contrary notwithstanding
(including, without limitation, the limited period of Landlord's warranties
herein otherwise expressed), Landlord shall proceed, at its sole cost and
expense and with all due dispatch, to cause the issuance of the final
certificate of occupancy from the Department of Labor and Industry without
expense to Tenant and without any interference with Tenant's use and enjoyment
of the Premises, without regard to how long it shall take to cause such
certificate to be issued. Landlord shall indemnify, defend and save and hold
harmless Tenant of, from and against any and all loss, cost, expense, damage or
liability (including reasonable attorneys' fees and costs) sustained or incurred
by reason of any determination by the Department of Labor and Industry or by any
other agency or authority that Tenant's use and occupancy of the Premises prior
to issuance of the said final certificate of occupancy was not lawful."
5
j) Notwithstanding anything to the contrary contained in this lease:
(i) in the event Landlord's Work has not been substantially completed
(as such term is defined in this lease) on or before September 1, 1999, as
such date shall be extended for Excusable Delays, Tenant shall receive one
(1) day's minimum rent for each day thereafter until Landlord's Work has
been substantially completed.
(ii) in the event Landlord's Work has not been substantially completed
(as such term is defined in this lease) on or before December 31, 1999, as
such date shall be extended for Tenant Delays (but not for Excusable
Delays) (the "Termination Right Date"), Tenant shall have the right to
terminate this lease upon 30 days' written notice to Landlord given within
10 business days after the Termination Right Date, provided, however, if
Landlord substantially completes (as such term is defined in this lease)
Landlord's Work within such 30 day period, Tenant's notice of termination
shall be null and void and of no further force or effect.
31. Multiple Option to Extend Term
------------------------------
Provided that both at the time of the exercise of this option (the
"Exercise") and at the commencement of the additional period for which the
option is being exercised (the "Additional Term Commencement"), there exists no
uncured Event of Default by Tenant under this lease and provided that Tenant (or
any assignee of Tenant approved by Landlord or otherwise permitted under this
lease without Landlord's consent) is the sole occupant of the Premises (except
for the occupancy of others pursuant to one or more subleases, provided that
such subleases, in the aggregate, relate to less than all of the Premises and
also, with exercise of all options available to the sublandlord and sublessee,
will not extend to the Expiration Date as it is then defined), Tenant shall have
the right and option to extend the Term for 2 additional periods of 60 months
each, exercisable by giving Landlord prior written notice, at least 9 months in
advance of the then Expiration Date, of Tenant's election to extend the Term; it
being agreed that time is of the essence and that this option is personal to
Tenant and nontransferable to any assignee (other than any assignee approved by
Landlord in writing or otherwise permitted under this lease without Landlord's
consent) or sublessee (regardless of whether any such sublease was made with or
without Landlord's consent) or other party. Such extension shall be under the
same terms and conditions as provided in this lease except as follows:
(a) The additional period shall begin on the then Expiration Date, as such
date may have been extended, and thereafter the Expiration Date shall be deemed
to be the 5th anniversary of the immediately preceding Expiration Date;
(b) All references to the Term in this lease shall be deemed to mean the
Term as extended pursuant to this Section;
(c) Tenant's right and option to extend the Term for 2 additional periods
as described above shall decrease by 1 additional period for each such
additional period that Tenant has extended the Term; and
(d) The Minimum Annual Rent during each lease year of each additional
period shall be $0.35 per rentable square foot more than the Minimum Annual Rent
applicable in the immediately preceding lease year.
6
32. Expansion Option. Provided Tenant is not then in default under this lease
----------------
beyond applicable notice and/or cure periods herein set forth, Tenant shall
have the right, at its option, to lease the space containing approximately
12,935 rentable square feet which is contiguous to the Premises and shown as
"Expansion Space" on Exhibit "A" (the "Expansion Space"), on the same terms and
conditions set forth in this lease, subject to the following:
(a) Tenant acknowledges that the Expansion Space is or will be leased to a
tenant (the "Expansion Space Tenant") pursuant to a lease (the "Expansion Space
Lease") which expires on or about April 30, 2000, subject to the Expansion Space
Tenant's right to extend the term of the Expansion Space Lease for an additional
6 month period.
(b) Promptly after the date on which the Expansion Space Tenant is required
to exercise its option to extend for 6 months (which is 120 days prior to the
initial expiration date of the Expansion Space Lease), Landlord shall notify
Tenant in writing ("Landlord's Notice") as to whether or not the Expansion Space
Tenant has exercised such option. In the event the Expansion Space Tenant has
not exercised such option, Tenant shall notify Landlord in writing ("Tenant's
Notice") on or before 10 business days after receipt of Landlord's Notice, such
time to be of the essence, whether it desires to lease the Expansion Space. In
the event the Expansion Space Tenant has exercised such option, Tenant shall, if
it desires to lease the Expansion Space, give Tenant's Notice on or before April
30, 2000, such time to be of the essence. If Tenant timely notifies Landlord
that it desires to lease the Expansion Space, Landlord and Tenant shall promptly
execute an amendment to this lease incorporating the Expansion Space in the
Premises, increasing the Minimum Annual Rent and Tenant's Proportionate Share to
reflect the increased area of the Premises and making such other changes to the
lease as may be required thereby.
(c) Landlord shall complete the Expansion Space in accordance with plans
and specifications therefor consistent with the Plans and Specifications.
Landlord shall deliver the Expansion Space vacant, broom clean, free of all
claims and possession by third parties and in compliance with all Laws and
Requirements. Rent with respect thereto shall not be payable until the earlier
of (i) the date Tenant first uses the Expansion Space for the conduct of
Tenant's business, or (ii) substantial completion of the Expansion Space.
Landlord shall provide an allowance of $25.00 per square foot for the Expansion
Space as set forth in Section 30(g), any excess to be paid by Tenant and any
decrease to be credited to Tenant over the remaining term of the lease. The
allowance for the Expansion Space, together with interest thereon at the rate of
10.5% per annum, shall be paid as additional minimum annual rent by Tenant over
the remaining term of the lease.
(d) In the event Tenant fails to timely notify Landlord of its desire to
lease the Expansion Space, this Section shall automatically be null and void and
of no further force or effect.
(e) In the event Tenant has timely notified Landlord of its desire to lease
the Expansion Space and in the event the Expansion Space Tenant fails to timely
vacate the Expansion Space, Landlord shall, at Landlord's sole cost and expense,
promptly commence and diligently pursue commercially reasonable efforts to
obtain possession of the Expansion Space and, if requested by Tenant, Landlord
shall use reasonable efforts to locate temporary space for
7
Tenant in other buildings owned by Landlord in the Horsham, Pennsylvania area
which shall be leased to Tenant at market rates.
33. Right of First Offer. If and when any portion of the Building (each,
--------------------
individually, the "Additional Space") becomes available for rental during the
term of this Lease and provided that there then exists no event of default by
Tenant under this lease which has continued beyond applicable notice and/or cure
periods contained in this Lease, and provided that Tenant (or any assignee of
Tenant approved by Landlord or otherwise permitted under this lease without
Landlord's consent) is the sole occupant of the Premises (except for the
occupancy of others pursuant to one or more subleases approved by Landlord or
otherwise permitted under this lease without Landlord's consent, provided that
such subleases, in the aggregate, relate to less than all of the Premises and
also, with exercise of all options available to the sublandlord and sublessee,
will not extend to the Expiration Date as it is then defined), Tenant shall have
the right of first offer to lease all of the Additional Space or, should Tenant
desire to lease less than all of the Additional Space, such lesser portion
thereof as Landlord may, in its reasonable discretion, agree to, subject to the
following:
(a) Landlord shall notify Tenant each time that the Additional Space first
becomes available for rental by any party other than the tenant then in
occupancy of the Additional Space and Tenant shall have 5 business days
following receipt of such notice within which to notify Landlord in writing that
Tenant is interested in negotiating terms for leasing such Additional Space and
to have its offer considered by Landlord prior to the leasing by Landlord of the
Additional Space to a third party. If Tenant notifies Landlord within such time
period that Tenant is so interested, then Landlord and Tenant shall have 10 days
following Landlord's receipt of such notice from Tenant within which to
negotiate mutually satisfactory terms for the leasing of the Additional Space by
Tenant and to execute an amendment to this lease incorporating such terms or a
new lease for the Additional Space. During such 5 business day and 10 day
periods, Tenant shall have the exclusive right to receive notice of the
availability of the Additional Space and to negotiate terms for the leasing
thereof and Landlord shall not solicit other offers for the Additional Space
during such time periods. Landlord and Tenant agree to negotiate terms for the
leasing of the Additional Space in good faith based on then existing market
conditions.
(b) If Tenant does not notify Landlord within such 5 days of its interest
in leasing the Additional Space or if Tenant does not execute such amendment or
lease within such 10 days, if applicable, then this right of first offer to
lease the Additional Space will lapse and be of no further force or effect and
Landlord shall have the right to lease all or part of the Additional Space to
any other party at any time on any terms and conditions acceptable to Landlord.
(c) This right of first offer to lease the Additional Space applies each
time the Additional Space becomes available, subject to renewal rights of any
tenant of the Additional Space.
34. Tenant's Need to Expand. In the event Tenant notifies Landlord in
-----------------------
writing during the Term that it requires premises containing at least
thirty-five (35%) percent more space than the Premises for the conduct of its
business, and provided Tenant is not then in default under the terms of this
Lease after the expiration of any applicable notice and/or cure periods, then at
Tenant's option, Landlord, to the extent such larger space is available in the
Building or in other
8
buildings owned by Landlord ("Other Buildings") which is not subject to
expansion options or other rights of tenants in the Building or the Other
Buildings, shall agree to lease same to Tenant at fair market rental rates and
other market terms existing at such time. In the event Landlord and Tenant
execute a lease for such larger space (the "New Lease"), then upon the
commencement date of the New Lease and timely delivery by Tenant of the Premises
to Landlord, vacant and in the condition required upon termination of this
lease, Landlord shall release Tenant from any further obligations under this
lease, except for those obligations set forth herein which specifically survive
termination of this lease.
This provision is valid only for so long as Liberty Property Trust or its
affiliates own the Building.
35. Parking. Tenant shall have the right to use, on a non-exclusive basis,
-------
370 parking spaces. Upon any expansion by Tenant, Tenant shall have the right to
use, on a non-exclusive basis, an additional 4 parking spaces per 1,000 square
feet of rentable area of the expansion premises, but in no event shall Tenant
ever have the right to use more than 550 parking spaces.
36. Termination of Existing Leases. Tenant currently occupies premises
------------------------------
(hereafter referred to individually as the "Existing Premises") located in the
buildings at Two Walnut Grove Drive, 000-000 Xxxxxx Xxxx and 000 Xxxxxxxx Xxxxx,
Xxxxxxx, Xxxxxxxxxxxx, pursuant to those certain leases listed on Exhibit "I"
attached hereto between Landlord or Landlord's predecessor and Tenant (each of
said lease agreements, collectively, the "Existing Lease"). At such time as the
Commencement Date hereunder shall have occurred and Tenant shall have vacated an
Existing Premises leaving same in the condition required upon termination as set
forth in the Existing Lease applicable to such Existing Premises, such Existing
Lease shall terminate and be of no further force and effect; provided, however,
that (a) all covenants, obligations and indemnifications of Landlord and Tenant
as set forth in such Existing Lease (as the same pertain to the leasing of the
Existing Premises prior to the Commencement Date of this lease) shall survive
and remain in force following the Commencement Date of this Lease and shall be
paid or performed by the applicable party when due or owing, provided that
Landlord shall submit a final operating expense reconciliation to Tenant "with
respect to such Existing Lease within 90 days after the termination of such
Existing Lease, and (b) all obligations, covenants and indenmifications of
Landlord and Tenant which are stated in such Existing Lease to survive
termination thereof, shall survive.
37. Contingency
-----------
(a) Landlord has entered into an agreement of sale to purchase the
Property. This lease and the obligations of the parties hereunder are contingent
upon Landlord's acquisition of title to the Property.
(b) In the event the contingency set forth in this Section is not satisfied
on or before May 31, 1999, either party may, at its option, cancel this Lease,
upon written notice to the other within five (5) days after such date, in which
event any advance rent or security deposit paid by Tenant to Landlord shall be
promptly refunded to Tenant and the parties shall thereafter have no further
liability hereunder.
9
38. Rental Abatement. Notwithstanding anything to the contrary herein
----------------
contained, Tenant shall not be required to pay monthly installments of minimum
rent and operating expenses with respect to 10,000 square feet of the Premises
for the first 4 full months (120 days) of the Term, and minimum rent and
operating expenses for such months shall be reduced accordingly.
39. Additional Provisions Relating to Building and Premises. Subject to
-------------------------------------------------------
receipt of all required governmental and third party approvals, Landlord shall,
at its sole cost and expense, provide an additional driveway entrance/exit to
the Property with direct access to Horsham Business Center. Promptly after the
satisfaction of the contingency set forth in Section 37, Landlord shall apply
for such required approvals and seek to obtain same diligently and in good
faith.
40. Additional Provisions Relating to Use; Compliance.
-------------------------------------------------
(a) In the first sentence of subsection 4(a), delete "reputable".
(b) It is agreed that Tenant's compliance obligations under subsection 4(b)
shall not include any duty imposed upon Landlord or Tenant by Laws and
Requirements which is mandated for office buildings, generally, and the need for
which does not arise out of Tenant's particular manner of use of the Property or
Tenant's alteration of or installations in or upon the Property. It is further
agreed that if the restrooms of the Premises are determined, by any governmental
authority having jurisdiction, to be not in compliance with ADA requirements
existing on the Commencement Date, Landlord will, at its sole cost and expense,
perform necessary modifications thereto to make same comply with applicable ADA
requirements in effect on the Commencement Date.
(c) It is agreed that Tenant's responsibilities pursuant to subsection 4(c)
shall be limited to Restricted Activities performed by or on behalf of Tenant.
Tenant shall indemnify, defend and hold harmless Landlord, its directors,
officers, partners and employees, from and against all claims, damages or losses
(including, without limitation, cleanup costs, penalties, fines and reasonable
counsel, engineering and other professional or expert fees and costs) arising
from Restricted Activities by Tenant or its Agents. Landlord shall indemnify,
defend and hold harmless Tenant, its directors, officers, partners and
employees, from and against all claims, damages or losses (including, without
limitation, cleanup costs, penalties, fines and reasonable counsel, engineering
and other professional or expert fees and costs) arising from any Restricted
Activities which occurred on the Premises prior to the date of this lease and
any Restricted Activities by Landlord or its Agents.
(d) On the third (3rd) line of subsection 4(d), delete "5 days after first
learning thereof" and substitute therefor "5 business days after an officer of
Tenant first learns thereof".
41. Additional Provisions Relating to Minimum Annual Rent. Notwithstanding
-----------------------------------------------------
the provisions of Section 6 to the contrary, it is agreed that the rent for the
first full month shall be due and payable on or before 5 business days after
Tenant receives notice that the contingency set forth in Section 37 has been
satisfied, which date may hereinafter be referred to as the "Payment Date".
10
42. Additional Provisions Relating to Operation of Property, Payment of
-------------------------------------------------------------------
Expenses.
--------
(a) Notwithstanding the provisions of subsection 7(a) to the contrary, it
is agreed that the monthly installment of Estimated Annual Operating Expenses
for the first full month shall be due and payable on or before the Payment Date.
(b) Notwithstanding any provision of subsection 7(a) to the contrary, it is
agreed that the following categories of expense shall not be included in Annual
Operating Expenses:
(i) Depreciation and amortization of the Building and the Property;
(ii) Salaries and benefits of executive officers of Landlord, of any
affiliates of Landlord, or of any third party management personnel;
(iii) Debt service payments on any indebtedness applicable to the
Building or the Property, including any mortgage debt or ground rents
payable under any ground lease;
(iv) Fines and penalties incurred by Landlord, unless caused by
Tenant;
(v) Tort claims and expenses of the investigation and defense thereof;
(vi) Amounts in excess of fair market rates in respect of any
transaction with, or provision of any item or service by, Landlord or any
affiliate of Landlord;
(vii) Management fees in excess of five percent (5%) of the sum of
Minimum Annual Rent and Additional Rent;
(viii) Costs associated with withdrawal from a "multi-employer plan."
(ix) The cost of performing any improvements included within the work
which Landlord is required to perform pursuant to Section 30 or Section 32;
(x) The cost of acquisition of the Property or construction or
renovation of the Building;
(xi) Costs associated with the refinancing of any of Landlord's debt;
(xii) Reserves for future expenditures or liabilities which would be
incurred subsequent to the then current lease years;
(xiii) Any bad debt loss, rent loss, or reserves for bad debt or rent
loss;
(xiv) Except as otherwise expressly provided in this lease, any and
all legal and other fees, audit fees, inspection fees, appraisal fees,
leasing commissions, advertising expenses, promotional costs, and other
costs incurred in connection with the acquisition, development, leasing,
and ownership of the Property;
11
(xv) Except to the extent that such fall within the scope of
subsection 7(d)(iii) and except for the payment of Landlord's commercially
reasonable deductible, not to exceed $5,000.00, the costs of repairing or
restoring any portion of the Building and the Property damaged or destroyed
by any casualty or peril, whether insured or uninsured, and costs of
restoration following a taking by condemnation or eminent domain;
(xvi) Costs associated with the clean up, remediation, and removal of
any hazardous wastes or substances and all other costs of causing the
Property to comply with applicable Laws and Requirements except as
otherwise expressly set forth in this lease;
(xvii) The additional premium charged for rent insurance for coverage
in excess of twelve (12) months, unless such longer coverage period is then
considered reasonable by industry standards;
(xviii) Administrative and overhead expenses (other than as part of
"Tenant Services");
(xix) Costs associated with causing the Property to comply with
applicable laws, codes, regulations or ordinances, to the extent the
Property was not in compliance (or if not in compliance, was not properly
"grandfathered" such that no alteration, modification, addition,
improvement, replacement or other action was required or would thereafter
be required in order to effect compliance) as of the date of substantial
completion;
(xx) Costs associated with Landlord's warranty work (as provided in
Section 63 below) and costs otherwise covered under warranties secured by
Landlord or to be secured by Landlord under Section 63.
Furthermore, the provisions of subsection 7(a) notwithstanding, annual
operating costs shall not include the annual amortization (or any other
measure of cost) of building improvements made by the Landlord for the
purpose of reducing operating expenses except to the extent such
improvements actually reduce operating expenses.
(c) Anything in this Article 7 contained to the contrary notwithstanding,
any and all expenditures incurred by Landlord and passed through to Tenant shall
be incurred in a commercially reasonable manner consistent with the operation,
maintenance and management of other first class office properties in the
suburban Philadelphia office market.
(d) In computing Tenant's obligations on account of Annual Operating
Expenses, Tenant shall be entitled to a credit for the following:
(i) Net recoveries by Landlord from any third party as a result of any
act, omission, default, or negligence of such third parties, or as a result
of a breach or default by such parties under the provisions of applicable
agreements which have caused Landlord to incur such costs and expenses; but
only to the extent that such recoveries are of money which has been charged
to Tenant as part of Annual Operating Expenses;
12
(ii) Recoveries by Landlord from insurance policies, to the extent
that the proceeds thereof reimburse Landlord for costs and expenses which
were, in fact, included in Tenant's Annual Operating Expenses.
(e) Tenant shall have the right, at its sole cost and expense, to
separately meter electric service to the Premises. Landlord shall, at its sole
cost and expense, separately meter electric service to any other portions of the
Building which are leased for other than general office purposes. In the event
the Premises is not separately metered for electric service and in the event
other space in the Building is separately metered for electric service, then for
purposes of electric service, Tenant's Proportionate Share shall be deemed to be
the ratio of the approximate rentable square feet of the Premises to the
approximate rentable square feet of the area of the Building which is leased for
general office purposes and which has not previously been separately metered for
electric service.
(f) In subsection 7(a)(ii), in the sixth (6th) line, the phrase "60 days"
is replaced with "1 year".
(g) The following provision is hereby added at the end of subsection
7(a)(ii):
"Tenant shall have the right to make any payment required pursuant to this
subsection 7(a)(ii) "under protest" and, if Tenant makes payment of such sums
under protest, such payment shall not be regarded as a voluntary payment, and
there shall survive the right on the part of Tenant to institute suit for the
recovery of such sum. Notwithstanding the foregoing to the contrary, if such
suit is not commenced within six (6) months after the payment under protest has
been made, the cause of action shall be deemed wholly lost. If Tenant commences
such suit within the required time period, and it shall be adjudged that there
was no legal obligation on the part of Tenant to pay such sum or any part
thereof, Tenant shall be entitled to recover such sum or so much thereof as it
was not legally required to pay under the provisions of this Lease."
(h) The following additional clause is added at the end of subsection
7(b)(i): ",and, in each such instance, only to the extent that the same would
be payable if the Property were the only property owned by Landlord."
(i) Impositions. The following provisions are hereby inserted at the end of
-----------
subsection 7(b):
For the purposes of this subsection 7(b), Tenant's Proportionate Share of a
municipal assessment (but not a real estate tax) shall only include those
installments thereof becoming due during the Term. If any assessments may be
paid in installments over a period of years, such assessments shall, for the
purposes of subsection 7(b), be deemed to be payable over the longest number of
years permitted by the assessing authority, and only the installments coming due
during the Term, together with any interest or carrying charges due, will be
included within the Impositions payable by Tenant. With regard to real estate
taxes, Landlord agrees to take advantage of opportunities to pay such taxes
during the discount period.
Any provision of this subsection 7(b) to the contrary notwithstanding,
Tenant's obligation hereunder shall not include any franchise, estate,
succession, or inheritance
13
taxes, nor any penalties imposed for late payment of any real estate tax,
assessment or other Imposition (except for penalties on taxes which Landlord has
not paid as a result of a bona fide contest or for which it has not received
payment from Tenant) and shall in no event include any real estate tax or
assessment attributable solely to a period occurring prior to the Commencement
Date.
Provided Tenant then leases more than 75% of the Building and provided
Tenant is not then in default under this Lease beyond applicable notice and/or
cure periods, Tenant shall have the right to require Landlord, at Tenant's sole
cost and expense, to contest or appeal the real estate taxes and tax assessments
relating to the Property. In lieu thereof, Landlord may authorize Tenant to
prosecute such appeal or contest, provided that Tenant shall provide to Landlord
for its reasonable review and approval prior to filing any applications,
affidavits and like supporting documentation required in connection with such
effort, Landlord shall have reasonably approved such contest or appeal and
Tenant shall consult with Landlord as requested in connection with such process,
and if undertaken, such contest or appeal shall be prosecuted with diligence and
in good faith and at Tenant's sole cost and expense. Landlord shall reasonably
cooperate with Tenant (including signing applications, affidavits and the like,
if so requested) subject to and in accordance with the conditions set forth in
this paragraph. Tenant acknowledges and agrees that Landlord's "reasonable
review and approval", as such term is used herein, shall mean and refer to
Landlord's good faith consideration of the reasonableness of Tenant's proposed
contest or appeal, and the accuracy of information set forth in such
documentation as shall have been prepared by Tenant and submitted to Landlord
for its review.
In no event shall impositions include fees, charges or assessments in
connection with the initial construction or development of the Property or
Landlord's redevelopment thereof, including, without limitation, development
fees, tap-in fees or other initial assessments or payments due and payable to
the local municipality or to a governmental or quasi-governmental agency or
authority in connection with the initial planning, approval or development of
the Property. The foregoing notwithstanding, Tenant acknowledges and agrees that
the Impositions for which Tenant is responsible hereunder shall include real
estate taxes which shall be levied based upon Xxxxxxxxxx County's assessment of
the Property as improved with the Buildings and other improvements contemplated
in this Lease.
Upon Tenant's request, Landlord shall provide to Tenant copies of real
estate tax bills and any correspondence received by Landlord regarding real
estate taxes and assessments with respect to the Property.
(j) In subsection 7(c)(ii), in the sixth and seventh lines thereof, the
phrase "as insured parties" is replaced with the phrase "as additional
insureds." In the seventh line thereof, after the word "Premises," add "only, as
expressly distinguished, for purposes hereof, from the balance of the Property."
In subsection 7(c)(ii), the following amendments are hereby made to the
requirements regarding Tenant's liability insurance:
In the ninth line of the printed form paragraph 7(c)(ii), at the end of the
printed line, after the word "issued in form," add "reasonably".
14
Landlord, as an operating expense, shall keep in effect comprehensive
general public liability insurance with respect to the Property, including
contractual liability insurance, which insurance shall provide combined single
limit per occurrence coverage of not less than Two Million Dollars ($2,000,000)
for property damage and bodily injury or death to one or more persons, with
endorsements for contractual liability. The insurer shall be a responsible
insurance carrier which is authorized to issue such insurance and licensed to do
business in the Commonwealth of Pennsylvania, and which has, at all times during
the Term, a rating of not less than A VII in the most current edition of Best's
Insurance Reports. Landlord shall deliver to Tenant on or before the
Commencement Date and subsequently upon request by Tenant from time to time, but
not more often than once every twelve (12) months, current certificates of
insurance evidencing the aforesaid comprehensive general public liability
insurance coverage, the property and casualty insurance coverage required of
Landlord under Section 7(c) of the Lease, and the waiver of subrogation or other
policy provision required by subsection 7(c)(iii).
In the event that Landlord shall request that Tenant increase its limits of
insurance as provided in Paragraph 7(c)(ii) of the Lease, Tenant agrees to do so
provided that the increased limits requested by Landlord are consistent with
limits of insurance then being required of tenants of other first class office
properties in the suburban Philadelphia office market, and provided, further,
that Landlord shall likewise increase the limits of insurance it is then
carrying to such levels as are then being required of Tenant by Landlord.
(k) In subsection 7(d)(ii), it is agreed that the written notice required
may be given by telefacsimile transmission addressed to Landlord's property
manager. Also with regard to such subsection, it is agreed that Landlord will at
all times maintain the Common Areas (including parking areas) of the Property
consistent with the standards generally observed at other first class office
buildings in the suburban Philadelphia office market. Also with regard to such
subsection, it is agreed that Landlord will make no alterations to the Common
Areas which will result in material interference with Tenant's ability to use
the Premises for the normal operation of its business, twenty-four (24) hours
per day, seven (7) days per week, three hundred sixty-five (365) days per year.
(l) With regard to subsection 7(d)(iii), it is agreed that the phrase
"Tenant's use, occupancy" shall be limited to the use or occupancy of the
Premises and the Property for other than normal business office use, and is not
intended to create additional responsibility on the part of Tenant for repairs
or replacements that would have been necessary solely as a result of Tenant's
use of the Premises and the Property for normal business office purposes.
(m) Notwithstanding the provisions of subsection 7(e)(i) to the contrary,
it is agreed that Tenant may use the Premises and the Property twenty-four (24)
hours per day, seven (7) days per week, three hundred sixty-five (365) days per
year, and that the Premises will be furnished with electricity, heat, and air
conditioning for its normal use and occupancy at all times, subject only to
interruption by matters not within Landlord's reasonable control.
(n) Subsection 7(e)(ii) is hereby deleted in its entirety and replaced with
the following:
15
"(ii) If, as a result of any cause within Landlord's reasonable
control (except for damage by fire or other casualty, which is dealt with
elsewhere in this Lease), utility service to the Premises is interrupted
resulting in a portion of the Premises being rendered untenantable for a
period of in excess of three (3) consecutive business days, commencing on
the fourth consecutive day of such untenantability, Tenant's obligations to
pay Rent shall xxxxx in proportion to that portion of the Premises so
rendered untenantable. Such abatement shall continue until the day on which
Landlord has cured the untenantability."
43. Additional Provisions Relating to Alterations and Fixtures.
----------------------------------------------------------
(a) With respect to subsection 9(a), Tenant shall have the right, without
Landlord's consent, to finance and to secure trade fixtures, furnishings,
equipment, machinery, signs and other personal property (excluding physical
alterations and leasehold improvements to the Building). If Tenant shall acquire
trade fixtures, equipment, machinery or other goods and effects subject to a
purchase money security interest, or shall lease any of the same, or if any
institutional lender provides Tenant with financing, the proceeds of which are
intended to enable Tenant to use and occupy the Premises or to operate Tenant's
business thereon, and such financing is secured in whole or in part by a lien on
or security interest in such goods, equipment, machinery or fixtures, Landlord
shall, upon request from Tenant, execute a subordination of any right it may
have to distrain upon or secure a lien against such goods, equipment, machinery
or fixtures for Tenant's failure to pay minimum rent or any additional rent or
any other event of default under the terms, covenants, conditions and provisions
of this lease, in substantially the form attached hereto as Exhibit "J".
(b) In the first sentence of subsection 9(b), the amount "$5,000.00 in the
aggregate" is hereby replaced with the amount "$35,000.00 per lease year."
(c) In subsection 9(b), in the second sentence thereof, the word
"reasonable" is inserted before the word "costs."
(d) In subsection 9(b), Tenant shall not be required to have plans prepared
by an architect or engineer in connection with any proposed alterations or
improvements for which professionally prepared plans are not required in order
to obtain the necessary governmental permits and/or approvals. In such cases,
Landlord will accept accurately prepared plans prepared by Tenant's personnel or
contractors.
(e) In subsection 9(b), with regard to alterations to the Premises which
require Landlord's approval, Landlord agrees that it will not unreasonably
withhold, delay or condition its approval, provided such alterations will not,
in Landlord's reasonable opinion, adversely impact the structure of the Building
or the operating systems of the Building. Otherwise, Landlord may withhold its
approval in its complete discretion.
In the event Landlord fails to respond to a written request for approval
within 10 business days after receipt thereof, Tenant shall send Landlord a
second written request therefor which shall state that if no objection is made
by Landlord within 5 business days after receipt thereof, such request shall be
deemed approved by Landlord. If Landlord fails to respond within such 5 business
day period, Landlord shall be deemed to have approved such request.
16
(f) With regard to subsection 9(d), it is agreed that Tenant shall not be
required to obtain Landlord's approval with regard to the painting or
wallpapering of interior wall surfaces within the Premises, provided that Tenant
notifies Landlord in writing prior to performing any such work and any such
painting or wallpapering can be covered with one (1) coat of primer and one (1)
coat of white paint, without additional sealing or painting.
44. Additional Provisions Relating to Mechanics' Liens.
--------------------------------------------------
In Section 10, in the fourth line thereof, the phrase "within 5 days after
Tenant has notice" is hereby replaced with the phrase "within 30 days after
Tenant has received written notice."
45. Additional Provisions Relating to Landlord's Right to Relocate Tenant,
----------------------------------------------------------------------
Right of Entry.
--------------
(a) Subsection 11(a) is deleted in its entirety.
(b) With regard to subsection 11(b), in the third line thereof, the time
period of "12 months" is hereby changed to "9 months".
(c) With regard to subsection 11(b), it is agreed that Landlord's right to
exhibit the Premises for the purpose of sale or mortgage or for the purpose of
leasing to a prospective tenant shall be restricted to normal business hours;
and Tenant shall have the right to have its personnel accompany Landlord and any
prospective mortgagee, purchaser, or tenant while on the Premises for such
purpose.
46. Additional Provisions Relating to Damage by Fire or Other Casualty.
------------------------------------------------------------------
(a) In subsection 12(a), in the second line thereof, after the phrase
"shall repair such damage and restore the Premises," the following phrase is
hereby inserted: "at its own cost and expense (except for payment as an
operating expense of Tenant's proportionate share of Landlord's commercially
reasonable deductible not to exceed $5,000 and such other amounts if the
provisions of subsection 7(d)(iii) are applicable)".
(b) In subsection 12(a), in the fifth line of the paragraph, the phrase
"180 days" is hereby deleted, and the phrase "one (1) year" is inserted in lieu
thereof
(c) The last sentence of subsection 12(a) is deleted and replaced with the
following:
If a casualty occurs during the last 12 months of the Term, as the same may
have been extended, Landlord will give notice to Tenant if, in Landlord's
reasonable opinion, the restoration of the damage will not be substantially
completed prior to that period of time which is 1/2 of the time interval
elapsing between the date of the casualty and the end of the Term. If Landlord
gives such notice to Tenant, and, within 10 days thereafter, Landlord does not
receive notice from Tenant that Tenant releases Landlord from any obligation to
restore the damage, Landlord may cancel this Lease unless Tenant has the right
to extend the Term for at least 3 more years and does so within 30 days after
the date of the casualty.
17
(d) Notwithstanding any provision of subsection 12(a) to the contrary, if
the Premises are damaged or destroyed by fire or other casualty and the
restoration of such damage has not been substantially completed on or before 365
days after it has occurred, Tenant shall have the right to terminate this Lease
effective 60 days after giving written notice of such termination to Landlord;
provided that if Landlord substantially completes the restoration within such 60
day period, Tenant's notice of termination shall be null and void.
(e) In subsection 12(b), the last sentence is hereby deleted and the
following sentence is substituted therefor:
"Tenant will receive an abatement of its minimum annual rent and operating
expenses to the extent and for so long as the Premises are rendered
untenantable, in whole or in part, for the normal conduct of Tenant's business
and are not, in fact, used for the conduct of Tenant's business."
47. Additional Provisions Relating to Condemnation.
----------------------------------------------
(a) In subsection 13(a)(ii), after the phrase "the reasonable operation of
Tenant's business," the following phrase is hereby inserted: "in Tenant's
reasonable opinion."
(b) In subsection l3(a)(iii), on the fourth (4th) line after "Property",
add "or in the event access to the Property is taken, or in the event a material
portion of the parking area of the Property is taken and the remainder thereof
is insufficient for the reasonable operation of Tenant's business".
(c) In the event of a partial taking, if Landlord's work of restoring of
the Premises results in a portion of the Premises being rendered untenantable,
Tenant's obligations to pay Rent shall xxxxx in proportion to that portion of
the Premises which is so rendered untenantable. The amount of such abatement
shall be adjusted to reflect that portion of the Premises rendered so
untenantable from time-to-time.
(d) With regard to subsection 13(c), in addition to having the right to
make a claim against a condemnor for moving expenses and business dislocation
damages, Tenant shall have the right to make a claim against a condemnor for any
alterations to the Premises made by Tenant at Tenant's expense, to the extent
that Tenant loses the value of such alterations for the balance of the Term.
48. Additional Provisions Relating to Nonabatement of Rent. In Section 14,
------------------------------------------------------
in the first line thereof, after the phrase "expressly provided," the following
phrase is hereby inserted: "as to interruption of utility services by Landlord
in subsection 7(e)(ii),...".
49. Landlord's Indemnification of Tenant. Subject to Sections 7(c)(iii) and
------------------------------------
16, Landlord will protect, indemnify, and hold harmless Tenant and its Agents
from and against any and all claims, actions, damages, liability, and expense
(including fees of attorneys, investigators, and experts) in connection with
loss of life, personal injury, or damage to property caused to any person in or
about the Property occasioned wholly or in part by the negligence of Landlord or
its Agents, except to the extent such loss, injury, or damage was caused by the
negligence of Tenant
18
or its Agents. In case any action or proceeding is brought against Tenant and/or
its Agents by reason of the foregoing, Landlord, at its expense, shall resist
and defend such action or proceeding, or cause the same to be resisted and
defended by counsel (reasonably acceptable to Tenant and its Agents) designated
by the insurer whose policy covers such occurrence or by counsel designated by
Landlord and approved by Tenant and its Agents. Landlord's obligations pursuant
to this Section shall survive the expiration or termination of this Lease.
Nothing contained in this Section 48 shall be construed to be in derogation of
Tenant's obligation to maintain the liability insurance policy specified in
subsection 7(c)(ii); nor in derogation of any rights which Landlord and
Landlord's agent may have under such liability insurance policy.
50. Additional Provisions Relating to Waiver of Claims. In Section 16, add
--------------------------------------------------
to the end of the Section "and such waiver by Tenant shall not be effective with
respect to any liability of Landlord described in Section 40(c) of this Rider".
51. Additional Provisions Relating to Assignment and Subletting.
-----------------------------------------------------------
(a) Notwithstanding any provision of Section 18 or this Rider Section 51 to
the contrary:
(i) Landlord's consent shall not be required with regard to an
assignment of Tenant's rights under this Lease to an assignee which is
reputable and which will utilize the Premises only for permitted uses
provided herein, provided that Tenant remains liable for its obligations
under this Lease after such assignment, and, both immediately before and
immediately after the assignment, either Tenant or its assignee is as
creditworthy as Tenant was on the date of this Lease;
(ii) none of (i) a change in the ownership of the stock of Tenant,
(ii) the sale of all or substantially all of Tenant's assets; (iii) a
merger, consolidation or other business combination of, with or involving
Tenant, or (iv) any other corporate reorganization of Tenant (items (i) -
(iv) within this Subsection 51(a) being hereinafter referred to as
"Corporate Transactions"; the purchaser of all or substantially all of
Tenant's assets, or the surviving entity following any one or more of the
remaining Corporate Transactions described herein, as assignee of this
Lease, being herein sometimes referred to as a "Corporate Assignee") shall
require Landlord's prior approval, as long as Tenant's or the Corporate
Assignee's creditworthiness after the Corporate Transaction equals or
exceeds Tenant's creditworthiness as of the date of this Lease and Tenant
remains liable for its obligations under this Lease after such assignment;
and
(iii) Landlord's consent shall not be required with regard to an
assignment of this Lease or a sublease of the Premises to any entity
controlled by, controlling or under common control with Tenant, provided
that Tenant remains liable for its obligations under this Lease after such
assignment or sublease.
(b) Nothing in this Lease shall limit or prohibit the initial public
offering or subsequent trading of Tenant's stock on a recognized securities
exchange, or any change in stock ownership or control resulting therefrom.
(c) Subsection 18(c)(i) is hereby amended to read in its entirety as
follows:
19
(i) As a condition of the effectiveness of any Transfer, Tenant shall
not be in default under this Lease, or if in default, Tenant shall have
cured such default, and no other default shall exist.
(d) In subsection 18(c)(iii), in the first line thereof, after the phrase
"form and substance," the word "reasonably" is inserted, and in the second line
thereof, after the phrase "all Tenant's obligations," the following phrase is
hereby inserted: "thereafter accruing."
(e) In subsection 18(c)(iv), in the first line thereof, the word "for" is
inserted before the phrase "Landlord's reasonable attorneys' fees."
52. Additional Provisions Relating to Subordination; Mortgagee's Rights.
-------------------------------------------------------------------
The first two sentences of subsection 19(a) are hereby deleted and the following
are substituted therefor:
"This lease shall be subordinate to any first mortgage or other primary
encumbrance now or hereafter affecting the Premises, subject to the express
condition that so long as no Event of Default shall exist and remain uncured,
Tenant's rights under this lease, including, but without limitation, Tenant's
right of possession of the Premises, shall not be disturbed by the holder of
such mortgage or by any purchaser upon foreclosure thereof. Although the
subordination and non-disturbance is self-operative, within 10 days after
written request, Tenant shall execute and deliver any further instruments
confirming such subordination and non-disturbance and any further instruments of
attornment that may be desired by any such mortgagee or Landlord pursuant to a
Non-Disturbance Agreement from such mortgagee or encumbrance holder in a
commercially reasonably form. Landlord represents and warrants to Tenant that
the Premises is not subject to any mortgage or ground lease as of the date of
this lease. Upon request of Tenant, Landlord shall use reasonable efforts to
obtain a non-disturbance agreement from the holder of any first mortgage or
ground lease affecting the Premises"
53. Additional Provisions Relating to Recording; Tenant's Certificate.
-----------------------------------------------------------------
(a) Within ten (10) business days after Landlord's receipt of a written
request therefor from Tenant, but in no event more frequently than two (2) times
in any lease year, Landlord agrees to execute and deliver to Tenant a written
statement certifying, to the best of Landlord's knowledge, whether Tenant is or
is not in default of any of its obligations under the Lease. Landlord's
certificate shall also confirm whether any late charges, interest or other
unpaid sums have accrued to Tenant's account which remain unpaid up to the date
of such certificate, and any such late charges, interest or other unpaid sums
not so accrued and reported shall for all purposes be deemed waived by Landlord.
Landlord shall not be deemed to be in default of its obligation to furnish such
certificate within the aforesaid time period, unless Tenant has given Landlord a
notice of noncompliance after such time period has expired and Landlord shall
have failed to furnish such certificate on or before two (2) business days after
Landlord's receipt of such notice of noncompliance.
(b) In the second sentence of subsection 20(a), the phrase "10 days" is
hereby deleted, and the phrase "10 business days" is inserted in lieu thereof.
The last sentence of subsection 20(a) is deleted in its entirety.
20
(c) With regard to subsection 20(b), it is agreed that such financial
information to be furnished by Tenant shall (in the absence of a further
agreement by Tenant) be limited to a verbal report from Tenant's Chief Financial
Officer regarding EBITA (earnings before interest, taxes, depreciation and
amortization), as well as an audited condensed balanced sheet, each as of the
end of Tenant's last fiscal year; except that, at any time that the shares of
Tenant are listed on a nationally recognized stock exchange, such financial
information shall consist of Tenant's most recent annual and quarterly reports
as filed with the Securities and Exchange Commission. Landlord agrees that any
financial information furnished by Tenant to Landlord which is not filed with a
governmental agency shall be held as confidential and shall not be exhibited to
anyone other than Landlord's mortgagee, prospective mortgagee, or prospective
purchaser. If Landlord shares such information with any of the foregoing
parties, Landlord shall in any event first advise such parties in writing of the
confidentiality of such information.
54. Additional Provisions Relating to Surrender, Abandoned Property.
---------------------------------------------------------------
(a) The following language is hereby added at the end of subsection 21(a):
"and also excepting damage by fire or other casualty and any repairs and
replacements required to be performed by Landlord under the terms of this
Lease."
(b) In subsection 21(c), in the first line thereof prior to the phrase
"shall continue to occupy," the following phrase is hereby inserted: "without
the prior written consent of Landlord."
(c) In subsection 21(c), in the fourth line thereof, the word "double" is
replaced with the phrase "one hundred seventy-five percent (175%) of".
55. Additional Provisions Relating to Curing Tenant's Defaults.
----------------------------------------------------------
(a) In Section 22, the paragraph caption "Curing Tenant's Defaults" is
hereby deleted, and the caption "Curing Defaults" is hereby inserted in lieu
thereof.
(b) In the third line of Section 22, after the word "after," insert "thirty
(30) days prior written." In the case of an emergency, Landlord shall first
attempt to contact by telephone Tenant's facilities manager before exercising
self-help remedies.
(c) In the second sentence of Section 22, after the word "any" in the third
line of the paragraph, insert "reasonable,".
(d) The following additional paragraph is hereby added to Section 22:
"Without limitation of Tenant's rights and remedies under this Lease, in
the case of an emergency, then Tenant, without any obligation so to do, may
elect to exercise the remedy of self-help to address and remedy such condition.
Landlord shall reimburse Tenant upon demand for any reasonable sums paid or
costs incurred by Tenant in remedying such condition, including interest thereon
from the respective dates of Tenant's incurring such costs, which sums and costs
together with interest shall be due and payable by Landlord to Tenant
21
within ten (10) days next following invoicing therefor by Tenant. In the case of
an emergency, Tenant shall first attempt to contact by telephone Landlord's
property manager before exercising self-help remedies.
56. Additional Provisions Relating to Defaults - Remedies.
-----------------------------------------------------
(a) Subsection 23(a)(iii) is hereby restated in its entirety as follows:
"(iii) If Tenant abandons the Premises or if Tenant vacates the
Premises without having given Landlord at least thirty (30) days' prior
notice and without having made adequate provisions for maintenance and
security of the Premises; or"
(b) In subsection 23(b)(ii), in the first line thereof, the phrase "by
breaking open locked doors if necessary" is replaced by the phrase "pursuant to
lawful process."
(c) In subsection 23(c), the parties agree that Tenant shall be entitled to
30 days written notice of defaults consisting of something other than the
failure to pay money.
(d) In subsection 23(c)(i), the parties agree that Tenant shall be entitled
to written notice and a grace period of two (2) business days from receipt
within which to cure any purported default under Section 20(a).
(e) Subsection 23(c)(ii) shall be limited to defaults consisting of the
failure of Tenant to pay money due to Landlord.
(f) In the subsection 23(c)(iii), the term "10 days" is hereby deleted in
the first and second lines, and the term "30 days" is inserted in lieu thereof
in each instance. At the end of Section 23(c)(iii), change the period to a comma
and insert "within an additional period of time not to exceed 90 days.".
(g) Subsection 23(c)(iv) is deleted and the following is substituted
therefor: "Any notice given by either party pursuant to this Section which is
served in compliance with Section 27 shall be adequate notice for the purpose of
such party's exercise of any available remedies under the terms of this Lease."
(h) The first three (3) sentences of subsection 23(d) are hereby restated
in their entirety as follows:
"No waiver by either party of a breach by the other shall be a waiver of
any subsequent breach, nor shall any forbearance by a party to seek a remedy for
any breach by the other party be a waiver by such forbearing party of any rights
and remedies with respect to such or any subsequent breach. Efforts by a party
to mitigate the damages caused by the other party's default shall not constitute
a waiver of the mitigating party's right to recover damages hereunder. No right
or remedy herein conferred upon or reserved to either party is intended to be
exclusive of any other right or remedy provided herein or by law, but each shall
be cumulative and in addition to every other right or remedy given herein or now
or hereafter existing at law or in equity."
22
(i) If Landlord accelerates Tenant's obligations under this Lease pursuant
to the provisions of subsection 23(b)(iii), payment from Tenant to Landlord of
the accelerated obligations which would not have been due at the time of
payment, but for Tenant's default and the resulting acceleration, shall be
discontinued to present values as of the date of such payment using the prime
rate of interest (the "Prime Rate") as published in The Wall Street Journal (or
any successor publication thereto) on the day before the date that payment is
made, or, if The Wall Street Journal (or any successor publication thereto) is
not published on the last mentioned date, using the prime rate of interest as
published in the immediately preceding edition of The Wall Street Journal (or
any successor publication thereto). Payments by Tenant shall first be applied to
Landlord's reasonable out-of-pocket costs directly associated with Tenant's
default and Landlord's acceleration; next to late charges previously accrued and
unpaid; next to interest accrued; next to Tenant's obligation that would have
been due from Tenant as of the date of payment had acceleration not occurred;
and last to Tenant's obligations which would not have been due at the date of
payment, but for the acceleration. The definition of "Term" as used in this
Section 23(b)(iii) shall mean and include only the then current term hereof
during which the default occurs, unless prior to such default occurring, Tenant
shall have caused the Term hereof to be extended in accordance with the
provisions of this Lease.
(j) If Tenant defaults under the terms of this Lease resulting in Landlord
recovering possession of the Premises, then Landlord agrees to use reasonable
efforts to relet the Premises in mitigation of Landlord's damages. Landlord
shall have no obligation to relet the Premises or any portion thereof in
preference to other space available for lease in the Building or in any other
building owned by Landlord or its affiliates.
57. Landlord's Representation Regarding Authority. Landlord is a duly
---------------------------------------------
formed Pennsylvania limited partnership in good standing, and has full
partnership power and authority to enter into this Lease and has taken all
partnership action necessary to carry out the transaction contemplated herein,
so that when executed, this Lease constitutes a valid and binding obligation in
accordance with its terms.
58. Additional Provisions Relating to Liability of Landlord.
-------------------------------------------------------
(a) The first sentence of Section 25 is hereby restated in its entirety as
follows:
The word "Landlord" as used herein includes the Landlord named above
as well as its successors and assigns, each of which shall be under the
same obligations and liabilities accruing after it acquires its interest in
the Property and each of which shall have the same rights, remedies,
powers, authorities, and privileges as it would have had it originally
signed this Lease as Landlord.
(b) The following language is added at the end of the second sentence of
Section 25:
(provided, except in the event of a successor in interest to Landlord
which acquired its interest by reason of an execution sale or a deed in
lieu of foreclosure, Landlord's successor in interest, in writing,
expressly assumes this Lease and agrees to perform all obligations
thereafter accruing hereunder.
23
(c) The last clause of the third sentence is hereby amended to read "...,
Tenant shall look solely to the equity of Landlord in the Property and the
rents, issues, profits and sales proceeds therefrom for the satisfaction of
Tenant's claims".
59. Additional Provisions Relating to Interpretation; Definitions. In
-------------------------------------------------------------
subsection 26(d), on the second (2nd) line, change "15%" to "12%".
60. Additional Provisions Relating to Notices.
-----------------------------------------
(a) The following language is hereby added at the end of the first sentence
of Section 27: "in writing upon not less than thirty (30) days' notice."
(b) The last sentence of Section 27 is hereby restated in its entirety as
follows:
The giving of notice by either party's attorneys, representatives, and
agents under this Section shall be deemed to be the acts of such party;
however, the foregoing provisions governing the date on which a notice is
deemed to have been received shall mean and refer to the date on which a
party to this Lease, and not its counsel or other recipient to which a copy
of the notice may be sent, is deemed to have received the notice.
61. Additional Provisions Relating to Security Deposit.
--------------------------------------------------
(a) Tenant may post and maintain the Security Deposit either in the form of
cash or in the form of a letter of credit. If the security deposit is maintained
in the form of a letter of credit, the following provisions shall apply:
(i) Each letter of credit shall be in a form and content satisfactory
to Landlord and shall be issued by a commercial bank acceptable to Landlord
under the Uniform Commercial Code of Pennsylvania. The issuing bank must
regularly maintain business offices in the Philadelphia Metropolitan Area
of Pennsylvania, and such letter of credit must be presentable and payable
at the counters of such bank located in such geographical area. Each letter
of credit shall be irrevocable and shall impose no conditions upon the
beneficiary's right to draw funds under it, other than a written statement
by the beneficiary to the issuing bank that an Event of Default has
occurred under the lease and remains uncured and Landlord is entitled to
draw upon the letter of credit. The beneficiary of each of the letters of
credit shall be Landlord, and each such letter of credit shall be
assignable by Landlord to any entity succeeding to Landlord's ownership of
the Premises. Landlord agrees that no funds will be drawn under any letter
of credit unless and until an Event of Default has occurred under this
lease and remains uncured or Tenant has failed to timely renew same as set
forth in subsection (ii) below.
(ii) Each letter of credit shall have an expiration date not earlier
than 3 months after the Expiration Date (such date being the "Expiry
Date"), or, if the expiration thereof is earlier than the Expiry Date, each
such letter of credit shall be extended, renewed, or replaced at least 30
days prior to its expiration so that it continuously remains in effect
through the Expiry Date. If the Term of this lease is extended or renewed
by any means, the Expiry Date shall be revised to be that date which is 3
months after the end of the Term, as so extended. Notwithstanding any
provision of this Section or Section 23 to the contrary, failure of Tenant
to
24
FIRST AMENDMENT TO LEASE AGREEMENT
----------------------------------
THIS FIRST AMENDMENT is made this 15th day of May, 1999, by and between
LIBERTY PROPERTY LIMITED PARTNERSHIP, a Pennsylvania limited partnership
("Landlord"), and VERTICALNET, INC., a Pennsylvania corporation ("Tenant").
BACKGROUND:
----------
A. Landlord and Tenant entered into a Lease Agreement dated April 21, 1999
(the "Lease"), covering premises at 000 Xxxxxxx Xxxx, Xxxxxxx, Xxxxxxxxxxxx, as
more fully described in the Lease.
B. Landlord and Tenant desire to amend the Lease in certain respects.
NOW, THEREFORE, the parties hereto, in consideration of the mutual promises
and covenants contained herein and in the Lease, and intending to be legally
bound hereby, agree that the Lease is amended as follows:
1. All capitalized terms used herein and not otherwise defined herein shall
have the meanings ascribed to them in the Lease.
2. Section 30 of the Lease is hereby deleted in its entirety and the
following is substituted therefor:
"30. Base Building Improvements; Tenant Improvements.
-----------------------------------------------
(a) Defined Terms. The terms set forth in the Summary of Terms and Certain
Definitions (on page 1 hereof) notwithstanding, the date set forth in Section
l(c)(i) is defined as the "COMPLETION DATE" and the "COMMENCEMENT DATE" is the
date set forth in subsection (i) below.
(b) Base Building Improvements. Landlord shall construct and complete, at
its sole cost and expense, improvements to the Building and the Property set
forth on the Scope of Work attached hereto as Exhibit "F" (the "Base Building
Improvements"). Landlord shall perform the Base Building Improvements in a good
and workmanlike manner pursuant to duly authorized and issued permits and
approvals and the Base Building Improvements shall comply at the time of
completion with all Laws and Requirements of the governmental authorities having
jurisdiction Which are applicable to such construction.
(c) Tenant Improvements. Landlord shall, at its sole cost and expense,
subject to reimbursement as set forth in subsection (g) below, construct and
complete the Premises ("Landlord's Work") in accordance with the plans attached
hereto as Exhibit "G"
(herein called the "Phase I Plans") and specifications attached hereto as
Exhibit "H" (herein called the "Phase I Specifications") and in accordance with
the plans to be attached hereto as Exhibit "G-1" (herein called the "Phase II
Plans") and the specifications to be attached hereto as Exhibit "H-1" (herein
called the "Phase II Specifications"). The Phase I Plans and the Phase I
Specifications cover Landlord's Work with respect to approximately 45,000 square
feet of the Premises ("Phase I"). The Phase II Plans and the Phase II
Specifications will cover the balance of the Premises ("Phase II") and will be
attached hereto upon approval thereof by Landlord and Tenant. The Phase I Plans,
the Phase I Specifications, the Phase II Plans and the Phase II Specifications
are hereinafter referred to collectively as the "Plans and Specifications").
Landlord's Work shall be performed in a good and workmanlike manner pursuant to
duly authorized and issued permits and approvals and shall comply at the time of
completion with all laws and requirements of the governmental authorities having
jurisdiction which are applicable to such construction.
(d) Tenant Changes in Plans and Specifications. Tenant shall have the
------------------------------------------
right, from time to time after the approval of the Plans and the Specifications,
to make changes in and to improvements shown thereon, provided, however, that
Landlord shall have the right to withhold its approval of changes requested by
Tenant which, in Landlord's reasonable judgment, (i) conflict with applicable
provisions of law or any covenants or restrictions applicable to the Property,
or (ii) would render the Premises materially more difficult to relet upon
termination of this lease, or (iii) require structural changes. Any such changes
shall be confirmed by written change order signed by Landlord and Tenant as set
forth in subsection (i) below, which shall confirm any delay caused by such
changes. Any delay in substantial completion of Landlord's Work as a result of
any such changes shall constitute a Tenant Delay (as hereinafter defined).
(e) Landlord Changes in Plans and Specifications. Landlord shall have the
--------------------------------------------
right from time to time, after the approval of the Plans and the Specifications,
to make reasonable and non-material changes in and to the same in each instance,
to the extent that the same shall be reasonably necessary;
(i) in connection with Landlord's construction of the Premises,
including without limitation, replacing then unavailable specified
materials with materials of equivalent or better quality, provided,
however, that Landlord shall make no changes to the finishes of the
Premises or changes which would increase the Cost of the Construction (as
hereinafter defined) or affect the operation of the Premises for the Use
without the prior written consent of Tenant; and/or
(ii) in order to cause Landlord's Work to comply with any applicable
requirements of public authorities and/or requirements of insurance bodies.
Any changes made by Landlord pursuant to this subsection shall not increase the
Cost of Construction nor deviate from the intended result of the Plans and
Specifications.
(f) Construction. Construction of Phase I shall be commenced promptly by
------------
Landlord and Phase I shall be substantially completed and ready for use and
occupancy by Tenant on the Completion Date. Construction of Phase II shall be
commenced
2
promptly after approval of the Phase II Plans and the Phase II Specifications,
the bidding of Landlord's Work for Phase II to three general contractors, the
selection of Landlord's contractor, with Tenant's consent, and the issuance of
all state and local permits required therefor, and shall be substantially
completed and ready for use and occupancy by Tenant within sixty (60) days after
issuance of such permits. The Phase II Plans and the Phase II Specifications are
being prepared by Tenant's architect. Landlord and Tenant shall use reasonable
good faith efforts to finalize the Phase II Plans and the Phase II
Specifications as soon as reasonably possible after receipt of same from
Tenant's architect. Upon approval of the Phase II Plans and the Phase II
Specifications, completion of bidding of Landlord's Work and the selection of
Landlord's contractor, Landlord shall promptly apply for required permits and
shall use diligent efforts to obtain same as soon as possible. The time for
substantial completion of Phase I and Phase II shall be extended for additional
periods of time equal to the time actually lost by Landlord or Landlord's
contractors, subcontractors or suppliers due to Change Orders, Tenant Delays (as
hereinafter defined), strikes or other labor troubles, governmental restrictions
and limitations, scarcity, unavailability or delays in obtaining fuel, labor or
materials, war or other national emergency, accidents, floods, defective
materials, fire damage or other casualties, adverse weather conditions, or any
cause similar or dissimilar to the foregoing beyond the reasonable control of
Landlord or Landlord's contractors, subcontractors or suppliers (collectively
"Excusable Delays"), provided that in each instance Landlord shall have notified
Tenant promptly upon learning of such occurrence or the reasonable likelihood
thereof and the length of the anticipated delay.
(g) Cost of Construction. As used herein, the term "Cost of Construction"
--------------------
shall mean and refer to the following costs, expenses and fees incurred by or on
behalf of Landlord in connection with Landlord's Work: (i) architectural,
engineering and design costs, (ii) the cost charged to Landlord by Landlord's
general contractor and all subcontractors for performing such construction, and
(iii) the actual cost to Landlord of performing directly any portion of such
construction. Landlord has heretofore competitively bid Landlord's Work for
Phase I to three general contractors and, with Tenant's consent, has selected
Xxxxxxx Construction as Landlord's general contractor.
When Landlord's Work for Phase I has been substantially completed, the Cost
of Construction for Phase I will be totaled. If such total (the "Phase I Total")
exceeds an allowance (the "Allowance") of $25.00 per rentable square foot for
Phase I plus $10.00 per rentable square foot for Phase II for a total Allowance
of $1,263,630 ("Phase I Excess Cost"), the amount of the Phase I Excess Cost
shall be due and payable by Tenant to Landlord within thirty (30) days after
Tenant's receipt of Landlord's computation of the Phase I Total, together with
reasonable supporting backup documentation, and a xxxx for the Phase I Excess
Cost. Such payment shall be due as Additional Rent hereunder.
If the Phase I Total is less than the Allowance (a "Phase I Cost
Decrease"), the amount of the Phase I Cost Decrease shall be credited against
Tenant's obligation to pay for the Cost of Construction of Phase II as set forth
in the next paragraph.
When Landlord's Work for Phase II has been substantially completed, the
Cost of Construction for Phase II will be totaled (the "Phase II Total"). If the
3
Phase II Total exceeds the Phase I Cost Decrease, if any (the "Phase II Excess
Cost"), the amount of the Phase II Excess Cost shall be due and payable by
Tenant to Landlord within thirty (30) days after Tenant's receipt of Landlord's
computation of the Phase II Total, together with reasonable supporting backup
documentation, and a xxxx for the Phase II Excess Cost. Such payment shall be
due as Additional Rent hereunder.
If the Phase I Total and the Phase II Total are less than the Allowance
(the "Overall Cost Decrease"), Tenant's Minimum Annual Rent obligation
throughout the Term shall decrease by $0.1619 per year for each $1.00 of the
Overall Cost Decrease, to be apportioned for amounts of such Overall Cost
Decrease which are less than $1.00.
In no event shall the Phase I Total exceed $1,435,409 unless due to changes
pursuant to subsections 30(d), 30(e) or 30(i)(ii).
(h) Acceptance of Premises. Section 3 of the Lease is deleted and restated
----------------------
as follows:
"Landlord represents to Tenant that the Property is zoned BC (Business
Campus District). Tenant has been given the opportunity to examine Township's
Zoning Code, and has satisfied itself that such Code will permit the use of the
Property for the conducting of Tenant's business thereon. Tenant's acceptance of
occupancy of the Premises shall, subject to such obligations as are assumed by
Landlord hereunder, and subject to Landlord's warranty obligations as
hereinafter described, constitute Tenant's acceptance of the work which Landlord
is required to perform pursuant to subsection 30(c), and any schedule or exhibit
in this lease, excepting only items listed on the Punch List (as hereinafter
defined). Tenant and its agents shall have the right, at Tenant's own risk,
expense, and responsibility, at all reasonable times prior to the Commencement
Date, upon reasonable prior notice to Landlord, to enter the Premises for the
purpose of taking measurements and installing its furnishings and equipment;
provided that Tenant does not interfere with or delay the work to be performed
by Landlord and Tenant uses contractors and workers compatible with the
contractors and workers engaged by Landlord.
At or immediately prior to the time Tenant takes occupancy of each of Phase
I and Phase II, a representative of Landlord and a representative of Tenant will
perform a walk-through inspection of such Phase and will prepare a punch list,
if one is required, of any items remaining to be completed, furnished, repaired,
or replaced ("Punch List"). Such Punch List will be signed by a representative
of Landlord and a representative of Tenant. Landlord agrees to cause all items
listed on such Punch List to be performed within thirty (30) days or such longer
period as shall be reasonably required in order to complete such items with
reasonable diligence."
(i) Term. Section 5 of the Lease is deleted and restated as follows:
----
"(i) The Term of this Lease shall commence on the earlier of (A) the
date of substantial completion (as hereinafter defined) of the improvements
to be
4
constructed by Landlord to Phase I under subsection 30(c), or (B) the date
Tenant first uses any portion of the Premises for the conduct of Tenant's
business (the "COMMENCEMENT DATE") and shall end at 11:59 P.M. on the last
day of the Term (the "EXPIRATION DATE"), without the necessity for notice
from either party, unless extended pursuant to the terms of this Lease, or
sooner terminated in accordance with the terms hereof. Landlord shall
confirm the Commencement Date and the Expiration Date by executing and
delivering to Tenant a Lease Commencement Certificate in the form attached
as Exhibit "B". In the event Tenant disagrees with the Commencement Date
and the Expiration Date set forth in the Lease Commencement Certificate,
Tenant shall notify Landlord in writing of its objection thereto, setting
forth the basis for Tenant's objection. If no written objection to the
Lease Commencement Certificate is received by Landlord within 10 days after
Tenant's receipt of the Lease Commencement Certificate, the Commencement
Date and the Expiration Date set forth in the Lease Commencement
Certificate shall be conclusively deemed to be accurate.
If and to the extent that the date of substantial completion of Phase
I is delayed as a result of a Tenant Delay (as hereinafter defined), the
Term of this lease and the Commencement Date (for all purposes other than
Tenant's right to occupy the Premises) and Tenant's obligation to pay rent
for the Premises shall commence as of the date Phase I would have been
substantially complete but for such Tenant Delays.
(ii) As used in this lease, the term "Tenant Delay" shall mean any:
(A) If a Change Order is signed by both Landlord and Tenant, the
Change Delay stated therein; or if a request for a Change Order is not
signed by both Landlord and Tenant, any actual delay resulting from
Landlord's evaluation of Tenant's Change Order request, and any actual
delay caused by a work stoppage required in connection with a review
of Tenant's request for a Change Order; provided that in no case where
a Change Order is not signed shall Tenant be charged with any such
delay unless Landlord has given Tenant prior notice that Landlord's
review of Tenant's Change Order request will cause such delay; and
(B) Actual delays caused by any of Tenant's installation or
construction work or Tenant's physical conduct at the Premises
actually interfering with the progress of Landlord's Work.
Each Phase of the Premises will be deemed substantially complete
when Landlord's independent architect shall certify to Tenant as to
such Phase that (i) all work which Landlord is required to perform
pursuant to subsection 30(c) has been satisfactorily completed
(subject only to completion of items set forth on the Punch List),
(ii) the HVAC, fire protection, electrical systems and all other
building systems shall be in proper working order and functioning
(subject to adjustment for seasonal conditions) in accordance with
design standards set forth herein, the exhibits hereto or the Plans
and Specifications, (iii) safe access to and egress from all parking
areas shall be provided, and (iv) all requisite township and state
certificates of occupancy shall have been delivered by Landlord to
Tenant, and Tenant shall be able to take occupancy of such Phase and
fully use and enjoy such Phase for the conduct of its business
thereon. The foregoing notwithstanding, a Phase shall not be deemed
other than
5
substantially complete by reason of (a) a punch list, if any, of minor
items remaining to be completed, furnished, repaired, or replaced, (b)
the issuance of only a temporary certificate of occupancy by the
township, provided that all conditions to the issuance of all final
certificates (or other permits) required for Tenant's lawful occupancy
shall be issued in the ordinary course without the satisfaction of any
further conditions (including the payment of money or the performance
of any work), and provided, further, that if any further conditions
remain to be satisfied, then Landlord shall follow-up with all due
dispatch to cause the issuance of final certificates of occupancy
without expense to Tenant or any interference with Tenant's use and
enjoyment of such Phase. In addition, a Phase shall not be deemed
other than substantially complete by reason of Landlord's failure at
the time of substantial completion to deliver a final certificate of
occupancy from the Commonwealth of Pennsylvania Department of Labor
and Industry, provided that Tenant shall be permitted to assume lawful
occupancy of such Phase pending the issuance thereof, and provided,
further, that if any further conditions remain to be satisfied for the
issuance thereof, then anything in this Lease contained to the
contrary notwithstanding (including, without limitation, the limited
period of Landlord's warranties herein otherwise expressed), Landlord
shall proceed, at its sole cost and expense and with all due dispatch,
to cause the issuance of the final certificate of occupancy from the
Department of Labor and Industry without expense to Tenant and without
any interference with Tenant's use and enjoyment of such Phase,
without regard to how long it shall take to cause such certificate to
be issued. Landlord shall indemnify, defend and save and hold harmless
Tenant of, from and against any and all loss, cost, expense, damage or
liability (including reasonable attorneys' fees and costs) sustained
or incurred by reason of any determination by the Department of Labor
and Industry or by any other agency or authority that Tenant's use and
occupancy of such Phase prior to issuance of the said final
certificate of occupancy was not lawful.
(j) Notwithstanding anything to the contrary contained in this lease:
(i) in the event Landlord's Work for Phase I has not been
substantially completed (as such term is defined in this lease) on or
before September 1, 1999, as such date shall be extended for Excusable
Delays, Tenant shall receive a credit of one (1) day's minimum rent for
each day thereafter until Landlord's Work has been substantially completed.
(ii) in the event Landlord's Work for Phase I has not been
substantially completed (as such term is defined in this lease) on or
before December 31, 1999, as such date shall be extended for Tenant Delays
(but not for Excusable Delays) (the "Termination Right Date"), Tenant shall
have the right to terminate this lease upon 30 days' written notice to
Landlord given within 10 business days after the Termination Right Date,
provided, however, if Landlord substantially completes (as such term is
defined in this lease) Landlord's Work for Phase I within such 30 day
period, Tenant's notice of termination shall be null and void and of no
further force or effect.
(iii) in the event Landlord's Work for Phase II has not been
substantially completed (as such term is defined in this lease) on or
before the date which is ninety (90) days after issuance of all state and
local permits required therefor, Rent shall xxxxx for each day thereafter
until Landlord's Work for Phase II has been substantially completed, such
6
abatement to be in the proportion that the rentable square footage of Phase
II bears to the rentable square footage of the Premises."
3. Subsection 32(f) is hereby added to the Lease as follows:
"(f) If Tenant timely exercises its right to lease the Expansion
Space, Landlord shall construct and complete, at its sole cost and expense,
Base Building Improvements to the Expansion Space set forth on Exhibit "F"
attached to this First Amendment in the manner set forth in Section 30(b),
unless such Base Building Improvements have been previously performed."
4. Section 61 of the Lease is hereby deleted in its entirety and the
following is substituted therefor:
"61. Additional Provisions Relating to Security Deposit.
--------------------------------------------------
(a) The Security Deposit shall be paid by Tenant to Landlord in cash.
Landlord shall deposit same at Progress Bank, Blue Xxxx, Pennsylvania ("Bank")
and, with the proceeds thereof, shall purchase, in Landlord's name, five (5)
certificates of deposit, each in the amount of $244,052.20, at Bank's prevailing
interest rates, maturing, respectively, at the end of the second, third, fourth,
fifth and sixth lease years.
(b) Upon the maturity of each Certificate of Deposit, Landlord shall
present same for payment. Provided that at the time of maturity of any
Certificate of Deposit, Tenant is not in default under this lease after the
expiration of any applicable notice and/or cure period, the principal and
interest received by Landlord upon the maturity of such Certificate of Deposit
shall be paid to Tenant. Interest accrued on each Certificate of Deposit shall
be includable in Tenant's income and not in Landlord's income unless such
interest is actually paid to Landlord and not paid over to Tenant.
(c) Notwithstanding the foregoing, upon the maturity of the last maturing
Certificate of Deposit, Landlord shall retain, as the cash Security Deposit for
the balance of the Term, an amount equal to 110% of the sum of (i) $79,514.10
(representing the average monthly rent for the last 5 years of the Term), plus
(ii) the then monthly installment of Estimated Annual Operating Expenses being
paid by Tenant under this lease. The cash Security Deposit shall be held by
Landlord in an interest-bearing account at a federally-insured institution for
the balance of the Term, such interest to be paid to Tenant annually provided
Tenant is not then in default under this lease after the expiration of any
applicable notice and/or cure period. Except as otherwise set forth in this
Section 61, the cash Security Deposit shall be held by Landlord in accordance
with the provisions of Section 28 of this lease. Interest accrued on the cash
Security Deposit shall be included in Tenant's income and not in Landlord's
income unless same is actually paid to Landlord and not paid over to Tenant.
(d) Upon the occurrence of any default by Tenant under this lease which
remains uncured after the expiration of any applicable notice and/or cure
period, Landlord shall have the right, pursuant to Section 28 of this lease, to
liquidate each Certificate of Deposit,
7
whether prior to, at or after maturity, and apply same in accordance with the
provisions of Section 28 of this lease."
5. Exhibit "F" to the Lease is hereby deleted in its entirety and Exhibit
"F" attached to this First Amendment is inserted in its place.
6. Section 29 of the Lease is hereby ratified and reaffirmed as follows:
"29. PA Additional Remedies.
----------------------
(a) When this lease and the Term or any extension thereof shall have
been terminated on account of any default by Tenant, which remains uncured
after the expiration of any applicable notice and/or cure period, or when
the Term or any extension thereof shall have expired, Tenant hereby
authorizes any attorney of any court of record of the Commonwealth of
Pennsylvania to appear for Tenant and for anyone claiming by, through or
under Tenant and to confess judgment against all such parties, and in favor
of Landlord, in ejectment and for the recovery of possession of the
Premises, for which this lease or a true and correct copy hereof shall be
good and sufficient warrant. AFTER THE ENTRY OF ANY SUCH JUDGMENT A WRIT OF
POSSESSION MAY BE ISSUED THEREON WITHOUT FURTHER NOTICE TO TENANT AND
WITHOUT A HEARING. If for any reason after such action shall have been
commenced it shall be determined and possession of the Premises remain in
or be restored to Tenant, Landlord shall have the right for the same
default and upon any subsequent default(s) or upon the termination of this
lease or Tenant's right of possession as herein set forth, to again confess
judgment as herein provided, for which this lease or a true and correct
copy hereof shall be good and sufficient warrant.
(b) The warrant to confess judgment set forth above shall continue in
full force and effect and be unaffected by amendments to this lease or
other agreements between Landlord and Tenant even if any such amendments or
other agreements increase Tenant's obligations or expand the size of the
Premises. Tenant waives any procedural errors in connection with the entry
of any such judgment or in the issuance of any one or more writs of
possession or execution or garnishment thereon.
(c) EXCEPT AS OTHERWISE SET FORTH IN THIS LEASE, TENANT KNOWINGLY AND
EXPRESSLY WAIVES ANY RIGHT, INCLUDING, WITHOUT LIMITATION, UNDER ANY
APPLICABLE STATUTE, WHICH TENANT MAY HAVE TO RECEIVE A NOTICE TO QUIT PRIOR
TO LANDLORD COMMENCING AN ACTION FOR REPOSSESSION OF THE PREMISES.
Initials on behalf
of Tenant: _____
8
7. Tenant acknowledges and agrees that the Lease is in full force and
effect and Tenant has no claims or offsets against rent due or to become due
hereunder.
8. Except as expressly modified herein, the terms and conditions of the
Lease shall remain unchanged and in full force and effect.
9. This First Amendment shall be binding upon and inure to the benefit of
the parties and their respective successors and permitted assigns.
IN WITNESS WHEREOF, Landlord and Tenant have executed this First Amendment
as of the day and year first above written.
Landlord:
LIBERTY PROPERTY LIMITED PARTNERSHIP
By: Liberty Property Trust, Sole General Partner
By: /s/ Xxxx X. Xxxxxxxxxx
--------------------------------------------
Xxxx X. Xxxxxxxxxx, Senior Vice President
Tenant:
VERTICALNET, INC.
By: /s/ Xxxx X. Xxxxxx
--------------------------------------------
Name: Xxxx X. Xxxxxx
Title: VP Finance and CFO
[Corporate Seal]
9
