LEASE AGREEMENT
THIS LEASE AGREEMENT ("Lease") is made as of the 1st day of July, 1998, by
and between ▇▇▇▇ ▇. ▇▇▇▇▇▇▇ and ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, both individuals having an
address of ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ (hereinafter
collectively referred to as "Landlord") and Prophet 21, Inc. (the "Tenant"), a
New Jersey corporation having an address of ▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇.
STATEMENT OF FACTS
A. Bucks County Industrial Development Authority ("the Authority"), a
Pennsylvania body politic and corporate, is the owner of all those lands and
premises situated in the Borough of Yardley, Bucks County, Pennsylvania,
commonly known as ▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇, Pennsylvania,
consisting of ten (10) acres, more or less (the "Real Estate") more particularly
described on the metes and bounds legal description which is attached hereto,
made a part hereof, and labeled Exhibit "A", and a certain building and other
structures situate thereon (collectively, the "Improvements").
B. The Real Estate and the Improvements shall hereinafter be collectively
be referred to as the "Leased Premises".
C. The Authority, a public agency incorporated to finance industrial and
commercial development in Bucks County, Pennsylvania, is the "Seller" and
Landlord is the "Buyer" of the Leased Premises pursuant to an Installment Sale
Agreement (the "Sale Agreement"), dated December 21, 1983, by and between the
Authority and Landlord.
D. Simultaneous with the execution of the Sale Agreement, the Authority and
Landlord entered into a certain Loan Agreement (the "Loan Agreement") with the
Broad Street National Bank of Trenton ("Mortgagee") to finance the purchase of
the Leased Premises by Landlord.
E. Landlord and Tenant were parties to a certain Lease Agreement, dated
August 21, 1987, and a certain Amended Lease dated February 29, 1988, as amended
March 10, 1990 and a certain Lease Agreement dated July 1, 1993 (collectively,
the "Prior Agreements").
F. Landlord desires to lease the Leased Premises to Tenant, and Tenant
desires to lease the Leased Premises, upon the terms and conditions hereinafter
set forth.
NOW THEREFORE, in consideration of the rents and the mutual covenants and
conditions hereinafter set forth, Landlord and Tenant, intending to be legally
bound, hereby agree as follows:
1. TERMINATION OF PRIOR AGREEMENTS. The Prior Agreements are hereby
terminated, rendered null and void, and of no further force or effect, and the
Landlord and Tenant shall have no further liability to each other with respect
thereto.
2. PREMISES. Landlord hereby demises and leases to Tenant and Tenant hereby
hires and rents, subject to the terms and conditions hereof, from Landlord, the
Leased Premises together with all rights, privileges, tenements, hereditaments,
easements and appurtenances belonging or appertaining thereto, to have and hold
unto Tenant, subject to the covenants and conditions contained herein which
Landlord and Tenant respectively agree to keep and perform.
3. TERM. The term of this Lease shall be for a period of five years (5)
years, commencing as of the 1st day of July, 1998 and terminating on the 30th
day of June, 2003.
4. POSSESSION.
4.1 Tenant shall be entitled to continued possession of the Leased
Premises to be used and occupied for any lawful purpose (including, but not
limited to, activities incident to the Tenant's business of selling computer
systems) as of July 1, 1998, and shall surrender possession of the Leased
Premises at the expiration of the Lease Term as herein provided. Tenant agrees
to give up quiet and peaceable possession of the Leased Premises at the end of
the term without further notice from Landlord.
4.2 Tenant, its employees, agents and invitees, shall comply with all
reasonable rules and regulations adopted by Landlord and with such reasonable
changes or additions thereto as Landlord may from time to time adopt and submit
to Tenant. All such rules and regulations shall be applied by Landlord in a
nondiscriminatory manner to all tenants and invitees. Any such rules and/or
regulations shall go into effect on the earlier of thirty (30) days after
receipt thereof in writing by Tenant, or thirty (30) days after actual knowledge
thereof by Tenant.
5. BASE RENT.
5.1 The annual base rent for the first year of the Lease Term shall
be Four Hundred and Thirty-Two Thousand Dollars ($432,000.00) payable in
consecutive, successive, and equal monthly installments of Thirty-Six Thousand
Dollars ($36,000.00) each, with the first installment due as of July 1,1998, and
thereafter payable in advance on the first (1st) day of each month at the
address of Landlord, as set forth above or such other place as Landlord may
designate by written notice to Tenant.
5.2 The annual base rent shall be increased on each July 1st of the
Lease Term by an annual amount of Fourteen Thousand Four Hundred Dollar
($14,400.00) above the annual base rent of the previous year of the Lease Term,
2
payable in monthly increases of One Thousand Two Hundred Dollars ($1,200.00) per
month.
5.3 All monthly payments of annual base rent shall be paid on the
first (1st) day of each month in advance in equal, consecutive, and successive
installments at the address of Landlord set forth herein or such other place as
Landlord may designate by written notice to Tenant.
6. ADDITIONAL RENT. Tenant shall pay as rent in addition to the annual
base rent herein reserved any and all sums which may become due by reason of
the obligations imposed on the Tenant under the terms of this Lease.
7. PAYMENT BY TENANT. Tenant shall pay, without demand, the rent and all
other charges herein reserved as rent on the days and times and at the place
that the same are made payable, without fail, and if Landlord shall at any time
or times accept said rent or rent charges after the same shall have become due
and payable, such acceptance shall not excuse delay upon subsequent occasions,
or constitute or be construed as a waiver of any of Landlord's rights. Any
charge or payment herein reserved, included or agreed to be treated or collected
as rent and/or any other charges or taxes, expenses, or costs herein agreed to
be paid by Tenant may be proceeded for and recovered by Landlord by distraint or
other process in the same manner as rent due and in arrears.
8. SERVICES PAID FOR BY LANDLORD. Landlord, at its sole cost, shall only
be responsible for the following matters and expenses with respect to the Leased
Premises during the Lease Term:
(a) provide fuel oil sufficient to operate the fuel oil fired heating
system of the Leased Premises for the periods comencing on October 1 and
terminating on May 31;
(b) maintain and repair the roof deck, foundation, structural and
load-bearing portion of the building, grounds, sidewalks, landscaping and
parking areas consisting of the Leased Premises;
(c) provide prompt and efficient snow removal for the parking areas of
the Leased Premises, and provide cindering of the entrance drive of the Leased
Premises, as necessary; and
(d) pay for the cost of municipal water and sanitary sewage disposal
for the Leased Premises.
9. SERVICES, TAXES AND COSTS TO BE PAID FOR BY TENANT. Tenant shall be
responsible for the following with respect to the Leased Premises during the
Lease Term, and for all costs, expenses, interest and penalty charges associated
therewith:
3
(a) Real estate taxes, county, township, school, special or general
assessments, and all governmental charges of whatsoever kind assessed or levied
against the Leased Premises, based on the per diem rate for the year. The amount
owed by Tenant shall be paid to Landlord within thirty (30) days after the date
on which Landlord has supplied Tenant with a ▇▇▇▇ for each tax, assessment and
charge.
(b) All personal property taxes, or other governmental assessments
or taxes, assessed on account of Tenant's personal property or on account of any
equipment located in, or affixed to, the Leased Premises.
(c) Janitorial services within the interior of the Leased Premises
including, but not limited to, the walls, floors, ceilings, carpets, windows and
closets, and for the removal from the Leased Premises of garbage and any other
refuse or solid waste including the cost of maintaining a dumpster or other
similar receptacle, including acquiring and maintaining any receptacles, bins or
containers to facilitate recycling.
(d) All electric utility costs and costs relating to the
maintenance and operation of the electrical system of the Leased Premises,
including all charges for electricity used in connection with cooling and
heating the Leased Premises.
(e) All general maintenance and upkeep of the Leased Premises,
including the repair of the electrical, heating, sanitary, air conditioning and
plumbing systems, appliances, sidewalks and the parking areas of the Leased
Premises. All maintenance and repairs by Tenant shall be made in a first class,
workmanlike manner by personnel or contractors previously approved by Landlord,
whose approval shall not be unreasonably withheld or delayed. Tenant shall
require its personnel and contractors to comply with all building standards,
code standards, and other reasonable requirements of Landlord.
(f) Making such alterations and improvements as Tenant shall
undertake and as shall be approved by Landlord pursuant to paragraph 17 hereof.
(g) Compliance with all statutes, ordinances, rules, orders,
regulations and requirements of the federal, state and municipal government and
any and all of their departments or bureaus relating to Tenant's operations on
the Leased Premises.
(h) All improvements to the Leased Premises made or ordered to be
made by any governmental authority having jurisdiction of the Leased Premises,
and compliance with all notices received from any public authority having
jurisdiction of the Leased Premises during the Lease Term.
Tenant shall not cause liens of any kind (whether for
materials, wages, labor or services) to be placed against the Leased Premises.
If
4
any such liens are filed, with or without Tenant's knowledge, Tenant shall
immediately, at Tenant's sole cost and expense take whichever action is
necessary to cause such liens to be satisfied and discharged. Tenant shall
obtain, file, and have properly indexed appropriate lien waivers prior to the
commencement of any work by Tenant on the Leased Premises.
Notwithstanding anything contained herein to the contrary,
Landlord shall be liable for and/or provide only such services as it shall
expressly undertake to provide in this Lease. Any other cost associated with the
Leased Premises shall be the responsibility and the expense of Tenant. In
particular, Tenant is responsible for every expense and service not explicitly
set forth in paragraphs 8 or 11.3 of this Lease.
10. RIGHT TO CONTEST. Tenant shall have the right to contest, by legal
proceeding, or by such other manner as Tenant shall reasonably deem suitable,
the validity or amount of any sum which Tenant is obligated to pay under
paragraph 9 herein, provided that such contest shall be free of any expense to
Landlord. Landlord agrees to cooperate in any such contest and execute all
documents reasonably required in connection therewith.
11. CONDITION OF LEASED PREMISES AND REPAIRS.
11.1 Tenant has examined the Leased Premises and accepts the Leased
Premises in its present condition, and, except as set forth herein, without any
representations on the part of Landlord or its agents as to the present or
future condition of the leased Premises. LANDLORD MAKES NO WARRANTIES, EXPRESS
OR IMPLIED, RELATING TO THE CONDITIONS IN OR ABOUT THE LEASED PREMISES.
11.2 Tenant shall take good care of the Leased Premises, and the
fixtures and appurtenances thereto, and shall take necessary action to ensure
that the Leased Premises shall suffer no waste or injury. Tenant shall further
make all minor repairs to the Leased Premises, keeping the Leased Premises
generally in good repair, order and condition, reasonable wear and tear
excepted, and, at the end of the Lease Term, Tenant shall vacate and surrender
the same to Landlord broom clean, free of debris, and in good order and
condition, reasonable wear and tear excepted. In addition, Tenant shall deliver
to Landlord all keys and entry devices to the Leased Premises.
11.3 Landlord shall maintain and make all structural repairs
(including the roof deck, foundation and load bearing portion of the
improvements), except those repairs necessitated by the negligence of Tenant. As
to those repairs and replacements necessitated by the negligence of Tenant,
Tenant shall immediately reimburse Landlord for the repair and replacement costs
incurred. Landlord shall use its best efforts to incur only reasonable costs in
connection with any repair or replacement to the Leased Premises for which
Tenant is obligated to reimburse Landlord. Landlord shall not be liable for any
injury to or interference with Tenant's business arising from the performance of
5
any repairs, maintenance or improvements in or to the Leased Premises or to any
appurtenances or equipment therein; provided, however, that Landlord shall
perform all such work with due diligence and in a manner so as to minimize
interference with Tenant's business.
11.4 Tenant shall not use any machinery or equipment at the Leased
Premises which produces excessive noise, vibration, odors or fumes without the
written consent of the Landlord, which consent shall not be unreasonably
withheld or delayed.
11.5 Tenant shall not do or permit to be done any act, or bring or
permit to be brought any material onto the Leased Premises, which shall be
deemed to be a fire hazard by any federal, state, or local law, statute,
ordinance or regulation, other than fuel oil.
12. COMPLIANCE WITH LAWS. Tenant shall comply with all statutes,
ordinances, rules, orders, regulations and requirements of the federal, state
and local government and of any and all of their departments and bureaus having
jurisdiction of the Leased Premises, for the correction, prevention and
abatement of nuisances, violations or other grievances, in, upon or connected
with the Leased Premises during the Lease Term, and shall also comply with all
rules, orders, and regulations of the Board of Fire Underwriters, or any other
similar body, for the prevention of fires, at Tenant's own cost and expense.
13. ENVIRONMENTAL. "Environmental Laws" means and includes all now and
hereafter existing statutes, laws, ordinances, codes, regulations, rules,
rulings, orders, decrees, directives, policies and requirements by any federal,
state or local governmental authority regulating, relating to, or imposing
liability or standards of conduct concerning public health and safety or the
environment.
"Hazardous Materials" means:
(a) any material or substance: (i) which is defined or becomes defined
as a "hazardous substance," "hazardous waste," "infectious waste," "chemical
mixture or substance," or "air pollutant" under Environmental Laws; (ii)
containing petroleum, crude oil or any fraction thereof which is liquid at
standard conditions of temperature and pressure; (iii) containing
polychlorinated biphenyls (PCBs); (iv) containing asbestos; or (v) which is
radioactive; or
(b) any other pollutant or contaminant or hazardous, toxic, flammable
or dangerous chemical, waste, material or substance, as all such terms are used
in their broadest sense, and defined, regulated or to become regulated
by Environmental Laws, or which cause a nuisance upon or waste to the Leased
Premises.
"Handle," "handled," or "handling" shall mean any installation,
handling, generation, storage, treatment, use, disposal, discharge, release,
6
manufacture, refinement, presence, migration, emission, abatement, removal,
transportation, or any other activity of any type in connection with or
involving Hazardous Materials.
No Hazardous Materials shall be handled, upon, about, above or
beneath the Leased Premises or any portion thereof by or on behalf of Tenant,
its subtenants or its assignees, or their respective contractors, clients,
officers, directors, employees, agents, or invitees except by express written
permission and consent of the Landlord. Any such Hazardous Materials so handled
shall be known as Tenant's Hazardous Materials. Notwithstanding the foregoing,
normal quantities of those Hazardous Materials customarily used in the conduct
of general administrative and executive office activities (e.g., copies fluids
and cleaning supplies) may be used and stored on the leased Premises without
Landlord's prior written consent, but only in compliance with all applicable
Environmental laws as defined herein.
Notwithstanding the obligation of Tenant to indemnify Landlord
pursuant to this Lease, Tenant shall, at its sole cost and expense, promptly
take all actions required by any federal, state or local governmental agency or
political subdivision, or necessary for Landlord to make full economic use of
the Leased Premises which requirements or necessity arises from the handling of
Tenant's Hazardous Materials upon, about, above or beneath the Leased Premises.
Such actions shall include, but not be limited to, the preparation of any
feasibility studies or reports and the performance of any cleanup, remedial,
removal or restoration work. Tenant shall take all actions necessary to restore
the Leased Premises to the condition existing prior to the introduction of
Tenant's Hazardous Materials, notwithstanding any less stringent standards or
remediation allowable under applicable Environmental Laws. Tenant shall
nevertheless obtain Landlord's written approval prior to undertaking any actions
required by this paragraph, which approval shall not be unreasonably withheld or
delayed so long as such actions would not potentially have a material adverse
long-term or short-term effect on the Leased Premises.
Notwithstanding anything contained herein to the contrary, Tenant
shall indemnify, defend, and hold Landlord harmless from and against any and all
suits, actions, damages, liabilities, and expenses, including reasonable
attorneys fees, arising out of the handling of Tenant's Hazardous Materials.
Notwithstanding anything contained herein to the contrary, Landlord
shall indemnify, defend, and hold Tenant harmless from and against any and all
suits, actions, damages, liabilities, and expenses, including reasonable
attorneys fees, arising out of the handling of any Hazardous Materials upon,
about, above or beneath the Leased premises or any portion thereof prior to the
date of this Lease, or not handled by or on behalf of Tenant, its subtenants or
its assignees, or their respective contractors, clients, officers, directors,
employees, agents, or invitees.
7
14. TENANT'S INSURANCE OBLIGATIONS.
14.1 Tenant shall insure, at its own expense, all of its own
equipment and other personal property situate on the Leased premises. Tenant
shall also insure, at its own expense, the Leased Premises by purchasing and
maintaining a single insurance policy in which Landlord is listed as a named
insured and the Leased Premises is insured for at least Five Million Dollars
($5,000,000.00), and which policy provides general liability coverage for Tenant
and Landlord in a policy amount of at least Two Million Dollars ($2,000,000.00),
and with umbrella liability coverage in an amount of at least Five Million
Dollars ($5,000,000.00), with deductibles which are reasonable and consistent
with commercial practice in similar circumstances. A certificate of insurance
stating the coverages obtained by Tenant shall be provided to Landlord within
thirty (30) days of the date of this Lease, and thereafter on each yearly
anniversary date of the date of this Lease. The certificate will indicate that
coverages are provided by a reputable and responsible insurance company licensed
to do business in the Commonwealth of Pennsylvania. The certificate will
stipulate that the insurer will give Landlord at least thirty (30) days advance
written notice of any impending cancellation or imposition of a major change in
such policy.
14.2 Tenant shall be responsible to provide fire and extended
coverage insurance on all leasehold improvements on the Leased premises,
including, but not limited to, all of Tenant's equipment, trade fixtures,
appliances, furniture, furnishing and personal property in or about the Leased
Premises. Such insurance shall include an all-risk legal liability endorsement
to cover property damage for which Tenant is responsible.
14.3 Landlord and Tenant each hereby release the other, and their
respective officers, directors, employees and agents from liability or
responsibility (to the other or anyone claiming through or under them by way of
subrogation or otherwise) for any loss or damage from liability for damage or
destruction to the Leased Premises, covered by any insurance policy, even if
such loss or damage shall have been caused by the fault or negligence of the
other party, or anyone for whom such party may be responsible, to the extent of
insurance proceeds. Landlord and Tenant each agree that any insurance policy
covering the Leased Premises will include such a clause or endorsement.
15. LIABILITY AND INDEMNIFICATION.
15.1 During the Lease Term, Landlord, or its employees or agents,
shall not be liable for any injury, loss, claims or damage to any person or
property occurring in or about the Leased premises, arising out of the use or
occupancy of the Leased Premises by the Tenant, or for any injury, expense,
loss, claim or damage, including attorneys fees and expenses, to any person or
property anywhere occasioned by any act, neglect or default of Tenant, unless
caused by the negligence of Landlord, or its agents or employees. Tenant shall
save Landlord
8
harmless and indemnify it from any such losses, claim or expense caused in whole
or in part by the negligence of Tenant, or its agents or employees.
15.2 During the Lease Term, Landlord, including Landlord's officers,
directors, employees, servants, invitees, licensees and agents, shall not be
liable for any injury or damage to persons or property occurring by reason of
any existing or future condition or latent defect in the Leased Premises
including, but not limited to, any mechanical or electrical equipment wiring or
appurtenances being out of repair, any damage or impairment of parking
facilities, curbs, walks or lawns, injury or damage resulting from falling
plaster, steam, gas, electricity, water, rain or snow (except as provided in
paragraph 8(c) hereof), which may leak from any part of the Improvements or from
pipes, appliances or plumbing work of the same, or from the outside or
subsurface or from any other place, or by dampness or any other cause of
whatever nature, or by fire, explosion, collapse or broken glass, or bursting,
leaking or running of any basin, tank, tub, wastepipe, gutter or downspout, nor
shall Landlord, or its agents, be liable for any such damage caused by other
tenants, if any, or persons in the Improvements, or caused by vandalism or
malicious mischief.
15.3. Tenant agrees to protect, indemnify and save harmless the
Landlord, its officers, directors, employees, and agents from and against any
and all claims, demands and causes of action (including without limitation,
reasonable attorneys fees and costs to pursue this indemnification), unless due
to the negligence of Landlord, its employees, or third parties, for any matter
growing out of or connected with the Tenant's use or occupation of the Leased
Premises during the Lease Term.
16. ASSIGNMENT AND SUBLETTING. Tenant shall not assign this Lease or sublet
the Leased premises, or any interest herein or therein, or allow others to use
or occupy the Leased Premises without obtaining the prior written consent of
Landlord, which consent shall not be unreasonably withheld or delayed. An
assignment of this Lease shall be deemed to have occurred: (a) if in a single
transaction or in a series or related transactions (other than resulting from
the death of a holder or owner) more than fifty percent (50%) of the interest in
Tenant or any subtenant (whether stock, partnership interests or otherwise) is
transferred, diluted, reduced, or otherwise impacted, with the result that the
present holders or owners of Tenant or such subtenant, have less than a fifty
percent (50% interest in Tenant or subtenant or; (b) any general partnership
interest in Tenant or such subtenant or a controlling interest (i.e. fifty
percent (50% or more) in any general partner of Tenant or such subtenant is sold
or otherwise transferred with the result that the then present general partners
of Tenant or such subtenant are no longer general partners of Tenant or
subtenant, or with the result that the then general partners of Tenant or such
subtenant no longer control such general partner or subtenant.
17. ALTERATIONS AND IMPROVEMENTS. Tenant shall make no alterations,
additions or improvements to the Leased Premises without the written consent of
9
Landlord, which consent shall not be unreasonably withheld or delayed. All
alterations, additions, and improvements shall belong to the Landlord, unless
the terms of Landlord's consent shall require their removal. Tenant shall have
the right to remove from the Leased Premises only those trade fixtures installed
by Tenant in accordance with this Lease.
17.1 All such work shall be carried on at Tenant's cost, and in a
first class, workmanlike manner in accordance with building standards and other
reasonable requirements of Landlord and in compliance with all governmental
orders, regulations and permits. Such work shall be performed by responsible
contractors approved by Landlord who will, prior to commencement of work, submit
satisfactory proof of insurance coverage naming Landlord as an additional
insured.
17.2 Following completion of such alterations, additions or
improvements by Tenant, Tenant shall furnish Landlord with current "as built"
plans and specifications reflecting such alterations, additions or improvements.
17.3 Tenant, with the prior written consent of landlord, may remove
any alterations, additions, fixtures, improvements, appliances or equipment
installed by Tenant which can be removed without damage to or leaving incomplete
the Leased Premises; provided, however (and anything herein to the contrary
notwithstanding), Landlord may direct Tenant at the end of the Lease Term or of
any prior termination, and whether or not Tenant is in default hereunder, to
remove all alterations, additions, improvements, trade fixtures, appliances or
other personal property brought into or placed about the Leased Premises by
Tenant or constructed or installed therein by Tenant (including but not limited
to, partitions, cabinets, shelving, drapes, shades, furniture, wiring and
plumbing) as may be specified in writing by Landlord.
18. DAMAGE TO THE LEASED PREMISES. If the Leased Premises shall be
partially damaged or rendered untenantable by fire or other causes, without
being due to the fault or neglect of Tenant, or Tenant's servants, employees,
agents or licensees, the Leased premises so damaged or rendered untenantable
shall be repaired promptly and within a reasonable time, by and at the expense
of Landlord and the rent from the time of such damage or untenantability until
such repairs shall be completed shall ▇▇▇▇▇ in proportion to the part of the
Leased Premises which is not reasonably useable by Tenant; in such event, any
rent paid in advance shall be apportioned and refunded. If such partial damage
or untenantability is due to the fault or negligence of Tenant, or Tenant's
servants, employees, agents or licensees, the Leased Premises so damaged shall
be repaired promptly and within a reasonable time by Landlord, but there shall
be no apportionment or abatement of rent. In the event of the Leased premises
being so badly damaged that it cannot be repaired within ninety (90) days from
the date of such damage, then the Lease Term hereby created shall, at the option
of either the Landlord or the Tenant, cease thirty (30) days after written
notice from either party to the other party, and Tenant shall surrender the
Leased Premises and all
10
of Tenant's interest therein to Landlord, and shall be liable for rent only to
the time of the surrender, and Landlord may reenter and repossess the Leased
Premises.
19. INSPECTION OF LEASED PREMISES; SHOWING LEASE PREMISES. Landlord and its
agents shall have the right to enter into and upon the Leased Premises, or any
part thereof, at all reasonable hours and with reasonable advance written notice
of at least twenty-four (24) hours, except that such notice shall not be
required in the event of an emergency, for the purpose of examining the same, or
making repairs or alterations therein. Landlord and its agents may show the
Leased Premises to persons wishing to hire or purchase the same at reasonable
hours and upon reasonable prior written notice to Tenant of at least twenty-four
(24) hours.
20. FAILURE TO SUPPLY UTILITIES/INTERRUPTION OF SERVICES. Landlord shall
not be responsible for the failure to furnish heat or other utilities or
services which are its obligation herein, provided the failure to furnish these
services results from reasons beyond Landlord's control.
20.1 This Lease shall not be affected and there will be no
diminution or abatement of rent or other payments and no constructive eviction
shall be claimed or allowed because of the interruption or curtailment of any
services or utilities in or to the Leased Premises from causes beyond Landlord's
control nor for any inconvenience arising from repairs in or about the Leased
Premises or from improvements made to the same.
21. CONDEMNATION. If the whole of the Leased Premises shall be acquired or
condemned by eminent domain for any public or quasi-public use, then, in that
event, the Lease Term shall cease and terminate from the date that title vested
in such proceeding. Tenant shall have no claim against Landlord for the value of
the unexpired Lease Term. No part of any condemnation award shall belong to
Tenant. Tenant expressly waives any right or claim to any part thereof and
assigns to Landlord any such right or claim to which Tenant might become
entitled (except as set forth in subparagraphs 21.3 and 21.4 hereof) and the
rent shall ▇▇▇▇▇ in proportion to the square footage taken or condemned.
21.1 If any part, but not the whole, of the Leased Premises shall be
so taken or conveyed, and in the event that such partial taking or conveyance
shall render the Leased Premises unsuitable for the business of Tenant, then the
Lease Term shall terminate as of the date on which possession of the Leased
Premises is required to be surrendered to the condemning authority, all rent and
other charges shall be paid up to that date, and Tenant shall have no claim
against Landlord for the value of any unexpired Lease Term. In the event of a
partial taking, partial condemnation, or conveyance supported by a power of
eminent domain which is not extensive enough to render the Leased Premises
unsuitable for the business of Tenant, then Landlord shall promptly restore the
Leased Premises to the extent of condemnation proceeds available for such
purpose to a
11
condition comparable to its condition at the time of such condemnation, less the
portion lost in the taking, and Tenant shall promptly make all necessary
repairs, restorations and alterations of Tenant's fixtures, equipment and
furnishings and shall promptly re-enter the Leased Premises and commence doing
business in accordance with the provisions of this Lease and this Lease shall
continue in full force and effect.
In the case of a partial condemnation, rent shall ▇▇▇▇▇ only to the
extent that the annual fair market rental value of the Leased Premises has been
diminished. The fair market value shall be determined by the agreement of two
licensed real estate appraisers - one selected by the Landlord and one selected
by the Tenant. If they cannot agree, then they shall jointly select a third
licensed real estate appraiser whose decision shall be binding on the parties,
except that Landlord reserves the right to declare that a complete condemnation
has taken place and in which case the Lease Term shall cease and terminate.
21.2 For purposes of determining the amount of funds available for
restoration of the Leased Premises from the condemnation award, said amount
shall be deemed to be that part of the award which remains after payment of
Landlord's reasonable expenses incurred in recovering same and any amounts due
to any mortgagee of Landlord, and which represents a portion of the total sum so
available (excluding any award or other compensation for land) which is
equitably allocable to the Leased Premises.
21.3 Although all damages in the event of any condemnation shall
belong to Landlord and any mortgagee of Landlord, Tenant shall have the right,
to the extent that same shall not diminish Landlord's or such mortgagee's award,
to claim and recover from the condemning authority, but not from Landlord or
such mortgagee, such compensation as may be separately awarded or recoverable by
Tenant in Tenant's own right for, or on account of, and limited solely to, any
cost to which Tenant might be put in removing Tenant's merchandise, furniture,
fixtures, leasehold improvements and equipment.
21.4 Tenant waives all claims against Landlord by reason of the
complete or partial taking of the Leased Premises and hereby relinquishes and
assigns unto Landlord any rights and damages to which Tenant might.otherwise be
entitled for condemnation of the leasehold estate created by this Lease;
provided, however, that Tenant shall nevertheless be entitled to make any claims
which Tenant may have against the condemning authority for relocation damages,
damages for tenant improvements and any other payments lawfully due tenants as
such, without diminution of the sums due Landlord.
22. NO OBSTRUCTIONS. Tenant shall not obstruct the entrance drive,
sidewalks, parking areas, or loading areas, nor allow the stairs within the
Leased Premises, or the internal halls to be obstructed or encumbered in any
manner.
12
23. SIGNS. No signs, advertising, notices or other lettering shall be
exhibited, inscribed, painted or affixed by Tenant on any part of the outside of
the Improvements or anywhere on the Real Estate, without the prior written
consent of Landlord, which consent shall not be unreasonably withheld or
delayed, and where required by law without proper license and permission by
municipal and governmental agencies regulation the same. However, Landlord
hereby consents to Tenant's placing and maintaining any appropriate sign next to
the entrance drive of the Leased Premises during the Lease Term, subject to
compliance with applicable governmental regulations.
24. NON-DISTURBANCE AND ATTORNMENT. Landlord and the Authority hereby
represent and warrant that neither Landlord nor the Authority are in default of
any of the terms, conditions, or provisions of the Sale Agreement, and neither
Landlord nor the Authority are aware of any condition which, with the passing of
time, would give rise to a default by either party under the Sale Agreement.
Both Landlord and the Authority shall give prompt written notice to Tenant of
any default by either party under the Sale Agreement.
Landlord, the Authority and Mortgagee hereby represent and warrant
that neither Landlord, the Authority, nor the Mortgagee are in default of any of
the terms, conditions, or provisions of the Loan Agreement, and neither
Landlord, the Authority, nor the Mortgagee are aware of any condition which,
with the passing of time, would give rise to a default by either party under the
Loan Agreement. Landlord, the Authority, and the Mortgagee shall give prompt
written notice to Tenant of any default by any party under the Loan Agreement.
So long as Tenant is not in default of any of the terms, conditions,
or provisions of this Lease, Tenant shall not, by reason of foreclosure of the
mortgage in favor of Mortgagee, acceptance by Mortgagee of a deed in lieu of
foreclosure, or the exercise of any remedy provided in the Loan Agreement, the
mortgage in favor of Mortgagee, or in the Sale Agreement, be disturbed in
Tenant's occupancy of the Leased Premises during the Lease Term.
Tenant shall attorn to and recognize as Tenant's landlord the
Authority, the Mortgagee, any purchaser at a foreclosure or judicial sale
relating to the mortgage in favor of Mortgagee or the debt secured thereby, or
any transferee by deed or assignment in lieu thereof, and its successors and
assigns.
25. MORTGAGE SUBORDINATION. This Lease shall be subject and subordinate at
all times to the lien of any mortgage, or any other hypothecation for security,
given or to be given, now on record or to be hereafter placed on the property of
which the Leased Premises are a part, without the necessity of any further
instrument or act of the part of the Tenant to effectuate such subordination.
Tenant hereby covenants and agrees to execute and deliver, upon demand, such
instrument or instruments evidencing such subordination of this Lease to the
lien of any such mortgage or mortgages, as shall be desired by any mortgagee or
proposed mortgagee and to further effectuate this covenant, Tenant
13
hereby appoints and constitutes Landlord to act as Tenant's attorney-in-fact,
authorized irrevocably to execute and deliver any such instrument or instruments
required in this paragraph for and in the name of Tenant.
26. COLLECTION OF DELINQUENT RENT. In the event that it shall become
necessary for Landlord to engage the services of an attorney or collection
agency to collect delinquent rent from Tenant, Tenant shall pay all reasonable
costs associated therein, including but not limited to attorneys fees, or
collection agency fees, together with all court costs and disbursement. Tenant
shall pay, as additional rent, all reasonable attorneys fees and other expenses
incurred by Landlord in enforcing any of the other obligations under this Lease.
27. DEFAULT PROVISIONS. Any of the following events shall be an "Event of
Default" by Tenant under this Lease:
(a) If default shall be made in the due and punctual payment of any
rent or additional rent payable under this Lease when and if the same shall
become due and payable, and such default shall continue for a period of ten (10)
days; or
(b) If any default shall be made by Tenant in the performance of, or
compliance with, any of the covenants, agreements, terms or provisions contained
in this Lease, other than those referred to in the foregoing subparagraph (a),
and such default shall continue for a period of thirty (30) days after written
notice thereof from Landlord to Tenant, or if such default is of a nature which
cannot be cured within thirty (30) days, if Tenant fails to commence to cure
such default within thirty (30) days after written notice thereof from Landlord
to Tenant, and thereafter fails to diligently cure such default; or
(c) If the Leased Premises shall be deserted or vacated by Tenant
prior to the expiration of the Lease Term; or
(d) If a voluntary or involuntary petition in bankruptcy shall be
filed by or against Tenant, or if Tenant shall be adjudicated a bankrupt or
insolvent, or shall make an assignment for the benefit of creditors, or shall
file any petition of answer seeking any reorganization, arrangement,
composition, readjustment, liquidation, dissolution or similar relief under the
present or any future federal or state insolvency act, all of which is not
either dismissed or terminated within sixty (60) days.
Landlord may, upon an Event of Default, terminate this Lease by
written notice to Tenant, and the Lease Term shall terminate on the date
specified in such notice, which date shall not be less than five (5) business
days after the date of the notice.
27.1 Upon any such termination of this Lease for an Event of
Default, Tenant shall quit and peacefully surrender the Leased Premises to
14
Landlord, and Landlord, upon or at any time after such termination, may without
further notice, enter upon the Leased Premises and repossess itself thereof, by
force, summary proceedings, ejectment or otherwise, and may dispossess Tenant
and remove Tenant and all other persons and property from the Leased Premises,
without being liable for any prosecution or damage therefor.
27.2 At any time or from time to time after such termination after
an Event of Default, Landlord may relet the Leased Premises or any part thereof,
in the name of Landlord or otherwise, for such term or terms (which may be
greater or less than the period which would otherwise have constituted the
balance of the Lease Term) and on such conditions and at such rental as Landlord
in its discretion shall deem to be appropriate.
27.3 No such termination of this Lease after an Event of Default or
re-entry by Landlord, whether or not the Leased Premises be relet, shall relieve
Tenant of its liability and obligations under this Lease; such liability and
obligations shall survive any such termination or re-entry and shall continue
during the remainder of the Lease Term.
27.4 For the purpose of reletting the Leased Premises after an Event
of Default, Landlord may make such repairs to the Leased Premises as may be
necessary to place the same in good order. Tenant shall be liable to Landlord
for the reasonable cost of such repairs and alterations, and all expenses of
reletting. If the sum realized from the reletting is insufficient to satisfy the
rent and additional rent required by this Lease, Tenant shall be liable for the
deficiency, which the Landlord may require Tenant to pay either month by month
or in a lump sum in advance. Tenant shall not be entitled to any surplus
accruing as a result of the reletting.
27.5 Tenant shall pay all reasonable costs, including attorneys
fees, collection agency fees, court costs and disbursements that shall be
incurred by Landlord in collecting delinquent rent or additional rent, obtaining
possession and other expenses incurred by Landlord in enforcing any of the other
obligations and covenants under this Lease including, but not limited to, Events
of Default.
27.6 No acceptance of full or partial rent during the continuance of
any Event of Default, shall constitute a waiver of any such Event of Default.
28. LANDLORD'S DEFAULT. In the event that Landlord shall fail in any
material respect to perform or observe any covenant or condition required to be
performed by Landlord under the terms and provisions of this Lease (which
failure materially and substantially affects Tenant's ability to quietly enjoy
the Leased Premises), and such failure is not cured within fifteen (15) days
after written notice shall have been given by Tenant to Landlord, Tenant may, at
its option, terminate this Lease at the end of such fifteen (15) day period or
invoke any of Tenant's other remedies at law or in equity; provided, however, if
Landlord's obligation is of such nature that more than fifteen (15) days are
required for its
15
performance, then Landlord shall be deemed to have complied with said notice if
Landlord shall commence such performance within said fifteen (15) day period and
thereafter proceeds diligently to prosecute the same to completion.
28.1 A termination of this Lease by Tenant due to Landlord's default
shall not be deemed a waiver by Tenant of any other rights or remedies which
Tenant may have against Landlord hereunder, at law or in equity, nor shall such
termination relieve Landlord of its liability to Tenant for any damages or
losses Tenant has suffered by reason of failure to perform.
29. NOTICES. All notices required under this Lease shall be in writing and
shall be sent by United States certified mail, return receipt requested, postage
pre-paid, or hand delivered, to the addresses of Landlord or Tenant, as the case
may be, set forth in the preamble to this Lease, or to such other address as
such party may in writing designate.
30. SECURITY DEPOSIT. As security for the performance by Tenant of all the
terms and conditions to be performed by Tenant hereunder, Tenant has heretofore
deposited with Landlord the sum of Twenty Thousand Dollars ($20,000.00), which
sum shall be returned to Tenant upon the expiration of the Lease Term or earlier
termination of this Lease, provided Tenant has fully completed such performance.
In the event of the sale or transfer of the Leased Premises, Landlord shall have
the right to transfer the security deposit to its successor for the benefit of
Tenant, and upon such transfer, Tenant acknowledges and agrees that Landlord
shall be released by Tenant from all liability for the return of said security
deposit.
31. HOLDING OVER BY TENANT. If Tenant shall remain in possession of the
Leased Premises after the expiration of the Lease Term, without having executed
a new or renewal lease, such holding over shall not constitute a renewal or
extension of this Lease and Landlord shall, at its option, be entitled to all
remedies available at law against a tenant holding over, or may elect to treat
the holding over as a tenancy from month-to-month, subject to all terms and
conditions of this Lease, except as to duration, but this shall not preclude
Landlord from increasing the monthly base rent amount during the holdover
period. Tenant shall be deemed to remain in possession until it shall vacate and
surrender the Leased Premises to the Landlord as described in paragraphs 11.2
and 17.3.
32. REMEDIES CUMULATIVE. All of the remedies hereinbefore given to
Landlord and all rights and remedies given by law and/or in equity shall be
cumulative and concurrent. No determination of this Lease or the taking or
recovering of the Leased Premises shall deprive Landlord of any of its remedies
or actions against Tenant for rent due at the time or which, under the terms
hereof, would in the future become due as if there has been no determination, or
for any and all sums due at the time or which, under the terms hereof, would in
the future become due as if there has been no determination, nor shall the
bringing of any action for rent or breach of covenant, or the resort to any
other remedy herein
16
provided for the recovery of rent be construed as a waiver of the right to
obtain possession of the Leased Premises.
33. QUIET POSSESSION. Landlord covenants that Tenant, on paying the said
rent, and performing the covenants aforesaid, shall and may peacefully and
quietly have, hold and enjoy the said Leased Premises during the Lease Term,
without hindrance or interruption by Landlord or any other person or persons
lawfully claiming through, by, or under Landlord.
34. INTEGRATION AND GOVERNING LAW. This Lease constitutes the entire
agreement between the parties hereto and there are no understanding, promises
representations or warranties, oral or written, relating to the subject matter
of this Lease, which exist or bind any of the parties hereto, their respective
heirs, executors, administrators, successors or assigns, except as set forth
herein. No amendment, change or addition to this Lease shall be binding upon
Landlord or Tenant unless reduced to writing and signed by both parties. It is
mutually understood and agreed that this Lease shall be interpreted in
accordance with the laws of the Commonwealth of Pennsylvania and that no
presumption shall be deemed to exist in favor or against either party hereto as
a result of the preparation or negotiation of the same.
35. BINDING EFFECT; SEVERABILITY. The covenants and agreements herein
contained are binding on the parties hereto and upon their respective
successors, heirs, executors, administrators and assigns. If any of the
provisions of this Lease are determined by a court of competent jurisdiction to
be illegal or unenforceable, the remaining provisions of this Lease shall
continue to be effective.
36. NO WAIVER OF ENFORCEMENT. Landlord shall have the right all times to
enforce the covenants and provisions of this Lease in strict accordance with the
terms hereof, notwithstanding any conduct or custom on the part of the Landlord
in refraining from so doing at any time or times; and, further, that the failure
of Landlord at any time or times to enforce its rights under said covenants and
provisions strictly in accordance with the same shall not be construed as having
created a custom in any way or manner contrary to the specific terms, provisions
and covenants of this Lease or as having in any way or manner modified the same.
37. FORCE MAJEURE. In the event that Landlord or Tenant shall be delayed,
hindered in or prevented from the performance of any act required hereunder by
reason of acts of God, strikes, blackouts, labor troubles, inability to procure
materials, failure of power, restrictive governmental laws or regulations,
riots, insurrection, the act, failure to act or default of the other party, war
or other reason beyond their control, then performance of such act shall be
excused for the period of the delay and the period for the performance of any
such act shall be extended for a period equivalent to the period of such delay
but in no event shall
17
this clause postpone, delay or excuse payment of rent by Tenant to Landlord or
taxes to the proper governmental authority.
38. RECORDING. This Lease shall not be recorded in any public office, but
upon the request of either party hereto, the other party shall join in the
execution of a memorandum or short form of this Lease for the purpose of
recording. The memorandum or short form of this Lease shall comply with the laws
of the Commonwealth of Pennsylvania and shall describe the parties, the Leased
Premises and the Lease Term and shall incorporate this Lease by reference.
39. HEADINGS; CONSTRUCTION. Captions of the paragraphs or parts of this
Lease are for convenience only, and shall not be considered or referred to in
resolving questions of interpretation or construction. The language in all parts
of this Lease shall in all cases be construed as a whole and in accordance with
its fair meaning, and shall not be construed strictly for or against Landlord or
Tenant.
40. COUNTERPARTS. The Lease, and the required consents of the Authority
and Mortgagee hereto, may be executed in counterparts, each of which shall be
deemed an original, all of which shall be deemed one and the same document.
IN WITNESS WHEREOF, the parties have hereunto set their hands and
seals as of the day ind year first above mentioned.
Witnesses: LANDLORD:
/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
------------------------ ---------------------------
▇▇▇▇ ▇. ▇▇▇▇▇▇▇
/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
------------------------ ---------------------------
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
TENANT:
Prophet 21, Inc. a New Jersey
business corporation
(Corporate Seal)
Attest: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇, III
---------------------- -------------------------
18
