Exhibit 10.13
FOURTH AMENDMENT TO LEASE
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THIS FOURTH AMENDMENT TO LEASE (the "Amendment") dated as of the 27th day
of November 2001, by and between FV OFFICE PARTNERS, L.P., successor in interest
to ▇▇▇▇ ▇▇▇▇▇▇ Realty Income Partnership III, L.P., a limited partnership
organized and existing under the laws of Delaware (hereinafter referred to as
"Landlord"), and COVALENT GROUP INC., successor in interest to Covalent Research
Alliance Corp., a corporation organized and existing under the laws of Nevada
whose present address is ▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇, ▇▇ ▇▇▇▇▇ (hereinafter
referred to as "Tenant").
W I T N E S S E T H T H A T :
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WHEREAS, Landlord leased certain premises at Glenhardie Corporate Center in
the building located at ▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ (the
"Building"), to Tenant pursuant to that certain Lease dated September 9, 1994,
amended by that certain First Amendment to Lease dated March 25, 1996 and that
certain Second Amendment to Lease dated November 14, 1996 (collectively, the
"Original Lease");
WHEREAS, Landlord and Interactive Health Computing Inc. ("IHC") entered
into that certain Agreement of Lease dated January 15, 1996 as amended by a
First Amendment to Lease dated March 25, 1996 (the "IHC Lease") regarding
certain space located on the first floor of the Building. Landlord consented to
the assignment of the IHC Lease to Tenant pursuant to that certain Assignment
and Assumption of Lease dated September 30, 1999 between Tenant and IHC in which
Tenant assumed the rights and obligations of the IHC Lease (the "Assignment and
Assumption") and that certain Consent to Assignment and Assumption between
Landlord, IHC and Tenant dated September 1999 (the "Consent"). The IHC Lease,
the Assignment and Assumption and the Consent are hereinafter collectively
referred to as the "IHC Lease Documents." The Original Lease and the IHC Lease
Documents as the same has been modified by that certain Third Amendment to Lease
dated July 31, 2001 (the "Third Amendment") are hereinafter collectively
referred to as the "Lease". The term "Premises" as used herein shall have the
same meaning as specified in the Third Amendment; and
WHEREAS, Landlord and Tenant have agreed to further amend the Lease in
accordance with the terms and conditions set forth herein;
NOW THEREFORE, Landlord and Tenant for good and valuable consideration,
intending to be legally bound, hereby agree as follows:
1. Effective January 30, 2002 the Premises shall be expanded to encompass
Suite 200 consisting of approximately 4,576 rentable square feet or an
acceptable similar suite of similar size in the Glenhardie Corporate Center (the
"Additional Premises"). Landlord shall provide the Additional Premises to Tenant
in its "as-is, where-is" condition.
2. Effective January 30, 2002 the term "Premises" as used herein shall
include the Additional Premises and the Premises shall consist of approximately
18,782 rentable square feet.
3. During the period between January 30, 2002 and the Long-Term Premises
Commencement Date (as hereinafter defined) the minimum fixed annual rent for the
Premises (as defined in Paragraph 2 above) shall be $24.00 per rentable square
foot payable in equal monthly installments. During such period "Tenant's
proportionate share" shall be 29.774%.
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4. Landlord agrees that prior to entering into a lease for the Expansion
Space (as hereinafter defined), Landlord shall provide Tenant with a written
notice offering Tenant the option to expand (the "Expansion Offer") into 1,238
rentable square feet on the second floor of the Building in the space known as
Suite 207 (the "Expansion Space") on the following terms and conditions:
(a) Tenant shall have ten (10) business days after receipt of the
Expansion Offer to accept the Expansion Offer by delivery of written notice
to Landlord.
(b) The Expansion Space shall be provided at $22.00 per rentable
square foot and the term shall be coterminous with and subject to the same
terms and conditions as are applicable to the Premises in the Lease.
(c) Landlord shall not be obligated to offer the Expansion Space to
Tenant more than one time prior to the Maturity Date (as defined in
Paragraph 11 below).
(d) Tenant shall not be in default of the Lease at the time of its
exercise of the Expansion Offer nor at the commencement of the lease term
for the Expansion Space.
(e) Effective upon the commencement of the term for the Expansion
Space, the Expansion Space shall become a portion of the Premises.
5. On the date on which Landlord gives written notice to Tenant that the
Long-Term Premises (as hereinafter defined) is substantially complete (the
"Long-Term Premises Commencement Date") the portions of the Premises known as
Suites 101, 104 and 200 consisting of approximately 1,245, 1,222 and 4,576
rentable square feet respectively (collectively, the "Give Back Space") shall be
surrendered by Tenant to Landlord within thirty (30) days of the Long-Term
Premises Commencement Date ("Give Back Space Surrender Date"). Upon the
occurrence of the Give Back Space Surrender Date the Give Back Space shall cease
to be a portion of the Premises and Tenant shall not have access to or use of
the Give Back Space. Tenant shall surrender the Give Back Space to Landlord as
of the Give Back Space Surrender Date in the condition and manner specified in
the Lease. Tenant shall not be required to pay Landlord Fixed Rent for the Give
Back Space for the period between the Long-Term Premises Commencement Date and
the Give Back Space Surrender Date; however, Tenant shall be required to pay all
other sums payable by Tenant to Landlord pursuant to the provisions of the
Lease.
The term "substantial completion" as used in this Amendment shall have the
same meaning as set forth in Article 3(b) of the Lease.
6. As used in this Amendment the term "Long-Term Premises" shall mean and
refer to in the aggregate: (i) approximately 11,739 rentable square feet on the
first floor of the Building known as Suite 100; and (ii) approximately 22,287
rentable square feet on the third floor of the Building known as Suite 300.
7. From and after the Long-Term Premises Commencement Date: (i) the term
Premises shall mean and refer to the Long-Term Premises; (ii) Tenant's
proportionate share shall be 53.940%; and (iii) the minimum fixed annual rent
for the Long-Term Premises shall be $25.50 per rentable square foot payable in
equal monthly installments. Such minimum fixed annual rent shall increase at a
per annum cumulative rate of $.50 per rentable square foot.
8. Landlord shall provide the Long-Term Premises to Tenant in its "as-is"
condition subject to the construction specifications attached hereto as Exhibit
"A" and made a part hereof (the "Tenant Improvement Work"). Landlord shall
provide Tenant with a tenant improvement allowance of $15.00 per
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rentable square foot in the Long-Term Premises (the "Tenant Improvement
Allowance") which may be used by Tenant, at Tenant's option, to pay for the cost
of the Tenant Improvement Work or for Tenant's relocation costs incurred in
connection with its occupancy of the Long-Term Premises. All Tenant Improvement
Work shall be performed in accordance with the terms and conditions of Exhibit
"A". All costs related to the Tenant Improvement Work in excess of the Tenant
Improvement Allowance shall be paid by Tenant.
9. The Landlord shall perform all Tenant Improvement Work in a good and
workmanlike manner. Landlord shall complete all Tenant Improvement Work on or
before January 1, 2003 (the "Completion Date") unless Landlord's completion of
the Tenant Improvement Work is delayed by Tenant's failure, without limitation,
to fulfill its obligations under Exhibit "A". In the event such Tenant delay
results in the Completion Date occuring after January 1, 2003, then the
Long-Term Premises Commencement Date shall be deemed to have occurred on January
1, 2003, notwithstanding the fact that all Tenant Improvement Work was not
substantially complete on that date, and Landlord's obligation to complete the
Tenant Improvement Work by the Completion Date shall be extended for a period of
time equal to the aggregate amount of such Tenant delay. If due to a delay
caused by Landlord, Landlord is unable to complete the Tenant Improvement Work
by the Completion Date in such manner as the Long-Term Premises may be deemed
substantially complete in accordance with the terms of Paragraph 5 of this
Amendment, Tenant's minimum fixed annual rent shall be abated in an amount equal
to one (1) day of the minimum fixed annual rent for the Long-Term Premises for
each day substantial completion is delayed beyond the Completion Date.
10. Landlord agrees that the provisions of Section 8 (i) regarding Tenant's
access to premises under construction shall be applicable to the Long-Term
Premises before the Completion Date.
11. The term of the Lease is hereby extended for a period of five (5) years
from the Long-Term Premises Commencement Date (such date, the "Maturity Date").
12. Tenant shall have the option to extend the term of the Lease for one
five (5) year period (the "Option Period") provided Tenant delivers written
notice to Landlord not less than nine (9) months prior to the Maturity Date.
Tenant may exercise the option provided in this Paragraph 12 provided Tenant is
in compliance with the following terms and conditions:
(a) Tenant shall not be in default under the Lease either at the time
of Tenant's proposed exercise of the option or as of the commencement date
of the Option Period;
(b) At the time Tenant elects to exercise the option Tenant shall, in
Landlord's reasonable judgment, be creditworthy;
(c) Prior to Tenant's proposed exercise of the option Tenant shall not
have previously assigned the Lease or sublet all or any portion of the
Premises unless such assignment or sublet was to an affiliate and permitted
under the terms of the Lease;
(d) All of the terms of the Lease during the Option Period shall
remain the same except that the minimum fixed annual rent payable during
the Option Period shall be at the then current market rate for similar
space in Glenhardie Corporate Center. Such rent shall be negotiated in good
faith between the parties provided, however, notwithstanding anything
contained in this Paragraph 12 to the contrary, in no event shall the
minimum fixed annual rent during the Option Period be less than the minimum
fixed annual rent in effect during the year immediately preceding the
Option Period; and
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(e) The five year renewal option specified in this Paragraph 12 shall
be Tenant's sole right to extend or renew the Lease and any renewal or
option provision currently contained in the Lease, if any, shall be null
and void and of no further force or effect.
13. Articles 20(d)(iii)(A) and 20(d)(iii)(B), which comprise the Confession
of Judgment portion of the Lease are hereby restated and reconfirmed as follows:
If Tenant shall default in the payment of the rent or any other sums
due hereunder by Tenant, Tenant hereby irrevocably authorizes and empowers
any prothonotary or attorney of any court of record to appear for Tenant in
any and all suits or actions which may be brought for said rent and/or said
other sums; and in said suits or actions to confess judgment against Tenant
for all or any part of said rental and/or said other sums, including but
not limited to the amounts due from Tenant to Landlord under clauses (i),
(ii), or (iii) of this Article 20, and for interest and costs, together
with an attorneys' commission for collection of five percent but not less
than Ten Thousand Dollars ($10,000). Such authority shall not be exhausted
by one exercise thereof, but judgment may be confessed as aforesaid from
time to time as often as any of said rental and/or other sums shall fall
due or be in arrears, and such powers may be exercised as well after the
termination or expiration of the term of this lease.
When this lease or Tenant's right of possession shall be terminated by
covenant or condition broken, or for any other reason, either during the
term of this Lease, and also when and as soon as such term shall have
expired or been terminated, Tenant hereby irrevocably authorizes and
empowers any attorney or any court of record as attorney for Tenant and any
persons claiming through or under Tenant to confess judgment in ejectment
against Tenant and all persons claiming through or under Tenant for the
recovery by Landlord of possession of the Premises, for which this Lease
shall be sufficient warrant, whereupon, if Landlord so desires, a writ of
execution or of possession may issue forthwith, without any prior writ or
proceedings whatsoever, and provided that if for any reason after such
action shall have been commenced the same shall be determined, canceled or
suspended and possession of the Premises hereby demised remain in or be
restored to Tenant or any person claiming through or under Tenant, Landlord
shall have the right, upon any subsequent default or defaults, or upon any
subsequent termination or expiration of this Lease or any renewal or
extension hereof, or of Tenant's right of possession, as hereinbefore set
forth, to confess judgment in ejectment as hereinbefore set forth one or
more additional times to recover possession of the said Premises.
In any action of or for ejectment or for rent or other sums, if
Landlord shall first cause to be filed in such action an affidavit made by
it or someone acting for it setting forth the facts necessary to authorize
the entry of judgment, such affidavit shall be conclusive evidence of such
facts; and if a true copy of this Lease (and of the truth of the copy such
affidavit shall be sufficient evidence) be filed in such action, it shall
not be necessary to file the original as a warrant of attorney, any rule of
court, custom or practice to the contrary notwithstanding. Tenant releases
to Landlord, and to any and all attorneys who may appear for Tenant, all
procedural errors in any proceedings taken by Landlord, whether by virtue
of the warrants of attorney contained in this Lease or not, and all
liability therefor.
Tenant Please Initial Here /s/ KMB
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14. The parties represent and warrant to each other that they have not
employed, dealt with or negotiated with any broker or agent other than Fox
Realty Co. and ▇▇▇▇▇ ▇▇▇▇ & Company. Landlord agrees to pay all commissions owed
to the named brokers in this Paragraph 14. Each party agrees to indemnify,
defend and hold the other party harmless from and against any and all demands,
actions, loss, damage or liability, including, without limitation, reasonable
attorneys' fees, to which the other party may now or hereafter become subject by
reason of any claim for commission, fee or other compensation to any broker or
agent not listed in this Paragraph 14 due as a result of the acts of the
indemnifying party.
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15. Landlord and Tenant agree they shall each utilize their best efforts so
that a new lease incorporating all of the terms and conditions of the Lease will
be executed by January 1, 2003, provided, however, that in the event a new lease
is not signed, the terms and conditions of the Lease shall remain in full force
and effect. Landlord and Tenant agree that the execution of a new lease is for
convenience of maintaining adequate documentation of the Lease and shall not
constitute a renegotiation or modification of the Lease.
16. The submission by Landlord to Tenant of this Amendment shall have no
binding force or effect, shall not constitute an option for the leasing of the
Premises nor confer any rights or impose any obligations upon either party until
execution thereof by Landlord and the delivery of an executed original copy
thereof to Tenant.
17. All capitalized terms in this Amendment not otherwise defined herein
shall have the meaning set forth in the Lease. This Amendment may be signed in
counterparts.
18. All of the terms, conditions and provisions of the Lease are
incorporated herein by reference as fully as though set forth in this Amendment.
19. The Lease remains in full force and effect, unamended, except as
expressly modified by this Amendment. All of the recitals set forth above are
hereby ratified and confirmed by Landlord and Tenant and incorporated herein by
reference.
20. The individual signing below on behalf of the Tenant represents that
s/he has the authority and power to bind the Tenant.
IN WITNESS WHEREOF, the parties hereto have executed this Fourth Amendment
to Lease the date set forth above.
LANDLORD: TENANT:
FV OFFICE PARTNERS, L.P. COVALENT GROUP INC.
a Delaware limited partnership a Nevada corporation
By: FVGP, L.L.C., a Pennsylvania limited By: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇, M.D.
liability company, General Partner -------------------------------
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇ Name: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇, M.D.
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▇▇▇▇▇▇ ▇. ▇▇▇ Title: CEO/President
a Member
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EXHIBIT "A"
COVALENT GROUP INC.
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LONG-TERM PREMISES CONSTRUCTION SPECIFICATIONS
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A. TENANT IMPROVEMENT ALLOWANCE
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Landlord shall provide to Tenant an allowance in the sum of Five Hundred
Ten Thousand Three Hundred Ninety Dollars ($510,390.00), which Tenant may use to
pay the cost of improvements and modifications to the Long-Term Premises, moving
expenses, data and telephone wiring, the cost of state and local permits, space
planning, Landlord's construction management fee pursuant to Paragraph H below,
furniture, fixtures and equipment for the Long-Term Premises (the "Tenant
Improvement Allowance"). Tenant may apply up to Seventy Two Thousand Dollars
($72,000.00) of the Tenant Improvement Allowance toward the Long-Term Premises
first month's Fixed Rent.
B. LONG-TERM PREMISES
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Landlord shall provide the Long-Term Premises in its "as is" condition,
free of debris and broom swept, subject to the Landlord's completion of the
Tenant Improvement Work as hereinafter described in this Exhibit "A".
C. TELEPHONE/DATA COMMUNICATIONS
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Tenant shall make arrangements with and pay for installation to the
Telephone or Data Company for its required installation within the Long-Term
Premises and will cause all such work to be performed at a time compatible with
Landlord's construction of the Tenant Improvement Work. At the expiration or
earlier termination of this Lease, Tenant shall remove all telephone and data
cabling and equipment and shall repair all damage to the Long-Term Premises
caused by the installation or removal of these items. Costs for this work may be
taken from the Tenant Improvement Allowance.
D. MONUMENT SIGNAGE
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Provided Tenant commits to lease fifty percent (50%) or greater of the
space in the Building, Landlord agrees that it shall provide, at Tenant's sole
cost and expense, identification of Tenant at the entrance drive, which Tenant
identification shall be located adjacent to or below the identification sign of
the Building. The size, type and location of the identification shall conform to
the existing signage as determined by Landlord. The costs for the signage may
taken from the Tenant Improvement Allowance.
E. HEATING, VENTILATION AND AIR-CONDITIONING
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Landlord, at Landlord's sole cost and expense shall retrofit the year-round
heating, ventilating, and air conditioning system in the Long-Term Premises.
Landlord shall provide wall-mounted thermostats with individual controls for
each zone within the Long-Term Premises.
Landlord will remove all abandoned heating, venting and air-conditioning
equipment from the Long-Term Premises.
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F. SCHEDULE OF DELIVERY OF TENANT'S DRAWINGS
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1. Tenant shall furnish Landlord, for its approval, the following complete
descriptive information with drawings, including both basic construction and
finish work for the Tenant Improvement Work on or before the dates listed below:
a. On or before May 1, 2002:
1. The location and extent of floor loading and floor opening
in excess of building standard.
2. The special air-conditioning needs by location and general
description of need.
3. Location and description of special plumbing requirements.
4. Estimated total electrical load including lighting for
entire space.
5. Partition locations, and type.
6. Door locations, size and type.
7. Location of electrical outlets and telephone outlets.
8. Any structural installations.
9. Air-conditioning loads.
10. Specific plumbing requirements, including plans and
specifications.
11. Cabinet work and any other information affecting other
trades.
12. Decorative plans including paint schedule, floor coverings,
draperies, wall coverings.
13. Architectural detailing.
2. Filing of Plans: Landlord shall without delay file all necessary plans
and obtain all necessary approvals and permits in connection with the Tenant
Improvement Work.
3. Substitutions: All Tenant Improvement Work shall require the
installation of new materials at least comparable to the quality installed in
the building.
Tenant may substitute material, equipment, and fixtures for those specified
for basic construction with written consent of Landlord not to be unreasonably
withheld, conditioned or delayed. Tenant shall pay Landlord the cost to Landlord
for such substitute items which is in excess of such items included in basic
construction of the Tenant Improvement Work. The cost to Tenant for such
substitution shall be Landlord's cost for the substitute item plus 5% of
Landlord's cost for Landlord's expenses and profit in the handling of the
substitution. Tenant may also request Landlord to omit the installations of
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any item not therefore installed and, provided such omission shall not delay
Landlord's completion of Tenant Improvement Work. Tenant shall be entitled to
any credit for any such item omitted against any additional item or any item of
a different kind of character.
G. TENANT'S FINISH WORK
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1. Landlord further agrees to approve or perform, at Tenant's request, upon
submission by Tenant of acceptable plans and specifications any additional or
non-standard work over and above that specified in Paragraphs B, C, D and E of
this Exhibit "A" (Tenant Additional Work). Tenant Additional Work shall be
performed by Landlord, at Tenant's sole expense, as an extra to Tenant
Improvement Work. Tenant may also have Tenant's contractors perform the Tenant
Additional Work as herein below provided. Prior to commencing any Tenant
Additional Work, Landlord will submit to Tenant written estimates of the cost of
the Tenant Additional Work. If Tenant shall fail to approve in writing any such
estimate within five (5) working days the same shall be deemed disapproved in
all respects by Tenant and Landlord shall not be authorized or obligated to
proceed thereon. Tenant agrees that to the extent the cost of Tenant Additional
Work shall exceed Twenty Five Thousand Dollars ($25,000.00) the same shall be
collectible as additional rent pursuant to the Lease and in default of payment
thereof, Landlord shall (in addition to all other remedies) have the same rights
as in the event of default of payment of rent.
2. Tenant may, at its option after occupancy of Long-Term Premises, employ
its own subcontractors to finish trade work; such as, carpentry, millwork,
cabinet work, carpeting and draperies as may be initially furnished and
installed by Tenant in the Long-Term Premises, provided such subcontractors work
in harmony with, and do not interfere with the labor employed by the Landlord,
its contractors or any other tenant or their contractors, and otherwise comply
with the provisions of the Lease, and provided Tenant's subcontractors accept
the administrative supervision of Landlord's representative. Workmen's
Compensation, public liability insurance and property damage insurance, with a
hold harmless provision, all in amounts and with companies reasonably
satisfactory to Landlord, shall be maintained by such finish trades
subcontractors; certificates of such insurance and waivers of liens shall be
furnished to Landlord prior to commencement of work.
H. WORK PERFORMED BY TENANT PRIOR TO COMMENCEMENT OF LEASE
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Landlord shall permit Tenant and its agents to enter the Long-Term Premises
prior to the Long-Term Premises Commencement Date to perform, through its own
contractors, work other than Tenant Improvement Work and any Tenant Additional
Work to be performed by Landlord, such other work, including but not limited to,
decorations and cosmetic improvements as Tenant may desire at the same time that
Landlord's contractors are working in the space. The foregoing approval to enter
prior to the Long-Term Commencement Date, however, is conditioned upon Tenant's
workmen and mechanics working in harmony and not interfering with the labor
employed by Landlord, Landlord's mechanics or contractors or by any other tenant
or their contractors and compliance with the terms of the Lease; and further
provided that Workmen's Compensation and public liability insurance and property
damage insurance, with hold harmless provisions, all in amounts and with
companies reasonably satisfactory to Landlord, shall be provided and at all
times maintained by Tenant's contractors engaged in the performance of the work,
and before proceeding with work, certificates of such insurance shall be
furnished to Landlord. If at any time, entry by Tenant's contractors shall cause
material disharmony or interference with Landlord's contractors performing
Tenant Improvement Work or Tenant Additional Work, this license may be revoked
by Landlord upon twenty-four (24) hours written notice to Tenant.
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Entry by Tenant, its contractors, employees or agents shall be deemed to be
under all of the terms, covenants, provisions and conditions of the said Lease
except as to the covenant to pay rent. Landlord shall not be liable in any way
for any injury, loss or damage which may occur to any of Tenant's decorations or
installations made prior to the Long-Term Commencement Date, the same being
installed solely at Tenant's risk.
The provisions of these construction specifications are specifically
subject to the provisions of the Lease.
I. LANDLORD'S CONSTRUCTION MANAGEMENT FEE
--------------------------------------
During the period between January 1, 2002 and Tenant's occupancy of the
Long-Term Premises, Landlord shall have the right to provide construction
management for and on behalf of Tenant, at Tenant's sole expense, at an amount
equal to five percent (5%) of the alteration's total cost. From and after
Tenant's occupancy of the Long-Term Premises, Landlord shall have the right to
provide construction management for and on behalf of Tenant, at Tenant's sole
expense, as provided for in Article 9 of the Lease.
J. TERMS IN LEASE
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All capitalized terms used in this Exhibit "A" shall have the meaning
proscribed to them in the Fourth Amendment to Lease to which this Exhibit "A" is
expressly made a part thereof.
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