EXHIBIT 10.19
FIFTH AMENDMENT TO LEASE AGREEMENT
THIS FIFTH AMENDMENT TO LEASE AGREEMENT ("Fifth Amendment") is made and
entered into as of the ___ day of September, 2002 by and between THE PRUDENTIAL
INSURANCE COMPANY OF AMERICA, a New Jersey corporation ("Landlord"), CONCERTO
SOFTWARE, INC., a Delaware corporation ("Concerto") and CELLIT, INC., a Florida
corporation ("Cellit"; Concerto and Cellit are jointly and severally referred to
herein as "Tenant").
W I T N E S S E T H:
WHEREAS, Cellit and Landlord's predecessor in interest, Codina West Dade
Development Corp., No.4, a Florida corporation, entered into that certain Lease
Agreement dated as of February 23, 1999, as amended by that certain First
Amendment to Lease Agreement dated as of March 30, 2000, as amended by that
certain Second Amendment to Lease Agreement (the "Second Amendment") dated as of
May 26, 2000, as amended by that certain Third Amendment to Lease Agreement
dated as of May 26, 2000, as amended by that certain Fourth Amendment to Lease
Agreement dated as of June __, 2002 (as so amended, the "Lease ") with respect
to therein described space comprising, taking into account the aforesaid
amendments, 36,159 rentable square feet, consisting of 765 rentable square feet
on the first floor (the "First Floor Space"), 27,204 rentable square feet on the
second floor (the "Second Floor Space"; the First Floor Space and the Second
Floor Space are collectively referred to herein as the "1st/2nd Floor Space"),
and 8, 190 rentable square feet on the third floor (the "3rd Floor Space"), all
of which is located in the building known as Westside Plaza II, 0000 Xxxxxxxxx
00xx Xxxxxx, Xxxxx, Xxxxxxx 00000 (the "Building"); and
WHEREAS. Landlord and Tenant desire to amend the Lease pursuant to the
terms and conditions hereinafter set forth in this Fifth Amendment.
NOW, THEREFORE, in consideration of the foregoing and the mutual promises
and covenants contained herein and in the Lease, and for other good and valuable
consideration, the receipt and sufficiency of which is hereby acknowledged,
Landlord and Tenant hereby agree as follows:
1. Cellit is the current "Tenant" under the Lease, as amended hereby. Cellit
hereby assigns to Concerto all of its right, title and interest in the Lease, as
amended hereby, which assignment shall for all purposes be deemed effective on
January 1, 2003. Concerto hereby accepts Cellit's assignment and assumes all of
Cellit's obligations under the Lease, as amended hereby, which acceptance and
assumption shall for all purposes be deemed effective on January 1, 2003.
Landlord hereby consents to such assignment and assumption.
2. The Term of the Lease is hereby extended from December 31, 2004 to December
31, 2012. The ten (10) year period between January 1,2003 and December 31, 2012
is hereinafter referred to as the "Recast Term."
3. Effective as of December 31, 2004, the Premises demised under the Lease shall
be decreased for all purposes under the Lease by the 3rd Floor Space (to wit, an
agreed approximate 8,190 rentable square feet located on the third (3rd) floor
of the Building) as more particularly shown cross-hatched on Exhibit A attached
hereto and made a part hereof. Following the deletion of the 3rd Floor Space,
the total space leased from Landlord to Tenant pursuant to the terms of the
Lease shall be the 1st/2nd Floor Space (to wit, 27,969 rentable square feet).
Tenant's Share shall thereafter be deemed to be 26.69%. On and prior to December
31, 2004, the lst/2nd Floor Space plus the 3rd Floor Space shall be deemed to be
the "Premises" under the Lease, as amended hereby; from and after January 1,
2005, the 1st/2nd Floor Space shall be deemed to be the "Premises" under the
Lease, as amended hereby.
4. As of December 31, 2004, Tenant (and any party claiming by, through or under
Tenant) shall surrender possession of the 3rd Floor Space to Landlord in the
same condition, excepting normal wear and tear, as originally delivered to
Tenant and otherwise in accordance with the terms of the Lease regarding
surrender of space upon the expiration or earlier termination of the Lease. In
the event Tenant (or any party claiming by, through or under Tenant) remains in
possession of the 3rd Floor Space after December 31, 2004, Tenant (and any party
claiming by, through or under Tenant) shall be deemed a tenant at sufferance on
the terms and conditions of Section 43 of the Lease and may be evicted by
Landlord without any notice, but Tenant shall be obligated to pay rent for the
3rd Floor Space for any such period that Tenant (or any party claiming by,
through or under Tenant) holds over at the holdover rates set forth in Section
43 of the Lease and shall also be liable for any and all other damages Landlord
suffers as a result of such holdover including, without limitation, the loss of
a prospective tenant for such space. Provided Tenant complies with the
provisions of this Section 4, Tenant (and anyone claiming by, through or under
Tenant) shall have no further obligations with respect to the 3rd Floor Space
from and after December 31, 2004 other than those which have accrued prior to
December 31, 2004 or those which are intended by the terms of the Lease to
survive the expiration or earlier termination of the Lease.
5. Subject to the remaining provisions of Section 34 of the Lease, the total
number of parking spaces available to Tenant pursuant to such Section 34 shall
be five (5) spaces per 1,000 rentable square feet in the Premises, which is
equivalent to one hundred forty (140) total unreserved spaces, from and after
January 1, 2005. In the event Tenant uses or encumbers parking spaces for
Tenant's emergency generator, uninterruptible power source or other equipment,
fixtures or personalty, such spaces so used or encumbered shall be deemed to be
included within the aforesaid number of available spaces and not in addition.
6. Prior to January 1,2003, Base Rent, Operating Expenses and all other Rent
under the Lease shall be paid on the terms and conditions of the Lease. During
the Recast Term (i.e., between January 1, 2003 and December 31, 2012), Base
Rent, Operating Expenses and all other Rent under the Lease shall continue to be
paid on the terms and conditions of the Lease, except that the payment of
Operating Expenses shall be modified as set forth in Section 7 below and Base
Rent during the Recast Term shall be paid in accordance with the Lease, as
amended hereby, but calculated in accordance with the following schedule:
First Floor Space:
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Period Base Rent Per Rentable Square Foot Per Annum
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January 1, 2003 - December 31, 2003 $17.96
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January 1, 2004 - December 31, 2004 $18.58
--------------------------------------------------------------------------------
January 1, 2005 - December 31, 2005 $19.21
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January 1, 2006 - December 31, 2006 $19.86
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January 1, 2007 - December 31, 2007 $20.53
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January 1, 2008 - December 31, 2008 $21.23
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January 1, 2009 - December 31, 2009 $21.94
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January 1, 2010 - December 31, 2010 $22.67
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January 1, 2011 - December 31, 2011 $23.43
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January 1, 2012 - December 31, 2012 $24.21
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PLUS
Second FLoor Space:
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Period Base Rent Per Rentable Square Foot Per Annum
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January 1, 2003 - December 31, 2003 $20.50
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January 1, 2004 - December 31, 2004 $21.12
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January 1, 2005 - December 31, 2005 $21.75
--------------------------------------------------------------------------------
January 1, 2006 - December 31, 2006 $22.40
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January 1, 2007 - December 31, 2007 $23.07
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January 1, 2008 - December 31, 2008 $23.77
--------------------------------------------------------------------------------
January 1, 2009 - December 31, 2009 $24.48
--------------------------------------------------------------------------------
January 1, 2010 - December 31, 2010 $25.21
--------------------------------------------------------------------------------
January 1, 2011 - December 31, 2011 $25.97
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January 1, 2012 - December 31, 2012 $26.75
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0xx Xxxxx Space:
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Period Base Rent Per Rentable Square Foot Per Annum
--------------------------------------------------------------------------------
January 1, 2003 - December 31, 2003 $22.98
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January 1, 2004 - December 31, 2004 $23.57
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7. (i) Effective January 1, 2003, the provisions of Section 13 (a) are hereby
deleted and the following is inserted in lieu thereof:
"(a) Tenant agrees to reimburse Landlord throughout the Term, as Additional
Rent hereunder, for Tenant's Share (as defined below) of annual Operating
Expenses (as defined below) in excess of annual Operating Expenses for calendar
year 2003 (the "Base Year Amount"). The term "Tenant's Share" shall mean the
percentage determined by dividing the rentable square footage of the Premises
(36,159 prior to December 31, 2004; 27,969 after January 1, 2005) by the
rentable square footage of the Building (104,799). Landlord and Tenant hereby
agree that Tenant's Share is 34.50% prior to December 31, 2004 and 26.69% after
January 1, 2005. Tenant's Share of excess Operating Expenses for any partial
calendar year(s) shall be appropriately prorated based on the number of days
Tenant has leased the Premises during that partial year."
(ii) Effective January 1, 2003, the provisions of Section 13(c)(3) are
hereby amended to insert the following sentence as the second to last sentence
thereof: "If the provisions of this subsection are applied in any calendar year
the Base Year Amount shall likewise be adjusted for the calendar year on which
it is based."
(iii) Effective January 1, 2003, subsection 13(d) is de1eted from the Lease
and amended by inserting the fol1owing: "The Aggregate Controllab1e Expenses
during the Recast Term, and any renewal thereof, shall not exceed five percent
(5%) per year on a cumulative, compounded basis, As used herein, Aggregate
Controllable Expenses shal1 mean the aggregate amount of al1 Operating Expenses
other than real estate taxes, utilities and insurance.
8. The provisions of Section 2(b) are hereby deleted and deemed to be of no
further force and effect. The following renewal option ("Option to Renew")
replaces such prior renewal option:
A. So long as the Lease, as amended hereby, is in full force and effect and,
both as of the exercise date and the first day of the Extended Term (as
hereinafter defined), no default has occurred and continued beyond the
expiration of any applicable notice and cure period and no facts or
circumstances then exist which, with the giving of notice or the passage of
time, or both, would constitute a default, Landlord hereby grants to Tenant
one (1) option to extend the Term with respect to all but not any lesser
portion of the Premises for a period of five (5) years beginning
immediately upon the expiration of the Recast Term ("Extended Term") on the
terms and Conditions hereinafter set forth.
B. Approximately twelve (12) months prior to the expiration of the Recast
Term, Tenant shall deliver to Landlord notice that it desires to consider
renewal of its Lease (the "Inquiry Notice"). Landlord shall, within thirty
(30) days after the receipt of Tenant's Inquiry Notice, notify Tenant in
writing of Landlord's reasonable determination of the Prevailing Market
Rate (as hereinafter defined) for the Premises for the Extended Term. The
term "Prevailing Market Rate" shall mean the Base Rent for the Extended
Term calculated at the prevailing market rate on a per square foot basis
for comparable leases covering buildings comparable to the Building (as
adjusted for any variances between such buildings and the Building and as
adjusted for other relevant factors, including, but not limited to, size of
space, location of space within the building, signage rights, age, location
and quality of building, length of term, tenant improvement contributions,
leasing commissions and rent concessions) located in the
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A/WD Submarket to which the Updated Base Year Amount (as defined in
paragraph C below) shall be added. Landlord shall also consider that
Tenant may not require an improvements allowance or rental abatement
typical of a new tenant and that Landlord shall not lose rent because
of any marketing or construction time. Upon receipt of Landlord's
determination of the Prevailing Market Rate, Tenant shall have thirty
(30) days to elect to exercise its Option to Renew by giving written
notice of its exercise to Landlord in the manner provided in this
Lease. If Tenant fails to deliver such notice within such thirty (30)
day period, the Lease shall not renew pursuant to this Option to
Renew.
C. If Tenant so exercises this Option to Renew, leasing of the Premises
by Tenant for the Extended Term shall be subject to all of the same
terms and conditions set forth in this Lease, except that the Base
Year Amount shall be updated to the amount of Operating Expenses for
the first calendar year of the Extended Term (the "Updated Base Year
Amount"); provided, however, that any construction provisions,
improvement allowances, rent abatements or other concessions
applicable to the Premises during the initial Term or the Recast Term
shall not be applicable during the Extended Term (unless otherwise
mutually acceptable to both Landlord and Tenant in the sole discretion
of each at the time Tenant exercises its option to extend) and
provided, further, that Base Rent for the Extended Term shall be
determined as set forth in subparagraph B above. Landlord and Tenant
shall enter into an amendment to this Lease to evidence Tenant's
exercise of this extension option. If this Lease is guaranteed now or
at any time in the future, Tenant simultaneously shall deliver to
Landlord an original, signed reaffirmation of each guarantor's
guaranty, in form and substance acceptable to Landlord.
9. (i) Tenant shall have the ongoing right to terminate the Lease with respect
to the First Floor Space only (the "Partial Termination Option") effective at
any time after December 31, 2004 on nine (9) months' prior written notice to
Landlord, which notice must be accompanied by payment to Landlord of the Partial
Termination Fee (as hereinafter defined), provided that no default has occurred
and continued beyond the expiration of any applicable notice and cure period and
no facts or circumstances then exist which, with the giving of notice or the
passage of time, or both, would constitute a default. The term "Partial
Termination Fee" shall mean $8,953.56 if the Partial Termination Option is
effective January 1, 2005 and shall decrease by $93.26 per month for each month
beyond January 1, 2005. For example, the Partial Termination Fee shall equal
$8,487.26 if the Partial Termination Option is effective on June 1, 2005
($8,953.56 minus $93.26 per month times 5 months.)
As of the effective date of the Partial Termination Option, Tenant (and any
party claiming by, through or under Tenant) shall surrender possession of the
First Floor Space to Landlord in the same condition, excepting normal wear and
tear, as originally delivered to Tenant and otherwise in accordance with the
terms of the Lease regarding surrender of space upon the expiration or earlier
termination of the Lease. In the event Tenant (or any party claiming by, through
or under Tenant) remains in possession of the First Floor Space after effective
date of the Partial Termination Option, Tenant (and any party claiming by,
through or under Tenant) shall be deemed a tenant at sufferance on the terms and
conditions of Section 43 of the Lease and may be evicted by Landlord without any
notice, but Tenant shall be obligated to pay rent for the First Floor Space for
any such period that Tenant (or any party claiming by, through or under Tenant)
holds over at the holdover rates set forth in Section 43 of the Lease and shall
also be liable for any and all other damages Landlord suffers as a result of
such holdover including, without limitation, the loss of a prospective tenant
for such space. Provided Tenant complies with the provisions of this Section
9(i), Tenant (and anyone claiming by, through or under Tenant) shall have no
further obligations with respect to the First Floor Space from and after
effective date of the Partial Termination Option other than those which have
accrued prior to effective date of the Partial Termination Option or those which
are intended by the terms of the Lease to survive the expiration or earlier
termination of the Lease.
If Tenant exercises this Partial Termination Option, effective on the
effective date of such partial termination, subsection 3(f)(v) of the Second
Amendment shall be deleted from the Lease and shall thereafter be deemed to be
of no further force and effect.
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(ii) Tenant shall have a one-time right to terminate this Lease (the
"Termination Option") effective January 1, 2011 by delivering to Landlord on or
before January 1, 2010 prior written notice of Tenant's exercise of this
Termination Option and payment in the amount of the Termination Fee (as
hereinafter defined), provided that no default has occurred and continued beyond
the expiration of any applicable notice and cure period and no facts or
circumstances then exist which, with the giving of notice or the passage of
time, or both, would constitute a default. The term "Termination Fee" shall mean
$116,950.42 if Tenant exercises the Partial Termination Option above and shall
mean $119,118.80 if Tenant does not exercise the Partial Termination Option
above.
10. Tenant hereby agrees to accept the Premises for the Recast Term "AS IS,
WHERE IS AND WITH ALL FAULTS", and, except as specifically set forth below,
Landlord is not obligated to construct any tenant improvements nor to provide
Tenant any improvement allowance. Subject to compliance with all applicable
laws, covenants, and restrictions and using materials equivalent, to the quality
and quantity of those initially furnished within the Premises and Building
standard construction methods, Landlord, at Landlord's sole expense, shall use
reasonable speed and diligence to repaint and recarpet the Second Floor Space
(the "Landlord's Work"). Landlord and Tenant shall work together in good faith
to jointly plan the construction schedule for Landlord's Work with an intended
completion day ,prior to January 1, 2005, with which construction schedule
Tenant shall cooperate and provide access to the Second Floor Space, as
applicable and appropriate. Landlord shall not be obligated to substantially
complete the Landlord's Work by any particular date, but Landlord shall use good
faith and reasonable efforts to complete the Landlord's Work in accordance with
the mutually acceptable construction schedule and prior to January 1, 2005 as
aforesaid. Any changes or upgrades to Landlord's Work shall be mutually agreed
upon in writing by both Landlord and Tenant, and any additional costs associated
therewith shall be borne by Tenant.
Tenant acknowledges that Landlord will be performing the Landlord's Work
while Tenant is in occupancy of the Second Floor Space. Tenant hereby agrees
that Tenant will, and will cause its agents, contractors, employees and invitees
to, work in harmony with Landlord and not unduly interfere with Landlord and its
agents, contractors and employees in doing the Landlord's Work. Tenant agrees
that the entry by Landlord, its agents, contractors and employees into the
Second Floor Space shall not constitute a constructive eviction of Tenant nor
discharge Tenant from any of its obligations under the Lease, as amended hereby,
nor entitle Tenant to any abatement of rentals owing under the Lease, as amended
hereby. Landlord shall use commercially reasonable efforts to minimize
disruption with Tenant's operations in the Second Floor Space in compliance with
the terms of the Lease, as amended hereby; however, Tenant acknowledges that it
would be impossible for Landlord to eliminate all disruptions.
11. Landlord shall reimburse Tenant for the actual cost incurred by Tenant in
fabricating and installing building signage pursuant to the terms of the second
paragraph of Section 16 of the Lease. Such reimbursement shall be made only upon
Landlord's receipt of invoices or other reasonable documentation confirming the
cost components and shall not exceed a maximum of $15,000.00. All other costs
associated with such signage, including any fabrication and installation costs
in excess of $15,000.00 and any restoration, repair and removal costs, shall be
borne by Tenant. Such signage shall be subject to the Governmental Requirements
as provided in Section 16 of the Lease and shall be subject to the prior written
approval by Landlord, the Westside Corporate Center Architectural Review Board
and any other applicable regulatory agencies.
12. The Cash Deposit pursuant to Section 44 shall hereafter be deemed to be
$49,606.00, which amount Landlord acknowledges it is currently holding as cash
security deposit for the Lease, as amended hereby. The LOC pursuant to Section
44 shall hereafter be deemed to be in the face amount of $47,780.38. Tenant
shall deposit with Landlord a new LOC in such face amount meeting the standards
of Section 44. So long as no default has occurred and continued beyond the
expiration of any applicable notice and cure period and no facts or
circumstances then exist which, with the giving of notice or the passage of
time, or both, would constitute a default, the LOC shall be returned to Tenant
as of January 1, 2006 and thereafter Landlord shall only hold the Cash Deposit
as security deposit under the Lease, as amended hereby.
13. The provisions of Section 57 of the Lease are hereby deleted and deemed to
be of no further force and effect.
14. Tenant and Landlord each represent to the other that they have dealt with no
broker, finder, real estate agent or other person entitled to a commission, fee
or other compensation in connection with or as a result of this
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Fifth Amendment or the transactions contemplated hereby or hereunder other than
Codina Realty Services, Inc. - Oncor International and Xxxxxxx & Xxxxxxxxx of
Florida, Inc, the fees for which shall be paid by Landlord pursuant to a
separate agreement. Each party hereby indemnifies the other and holds the other
harmless from any and all claims, losses, costs and damages (including
reasonable attorneys' fees) arising in connection with a breach of the aforesaid
representations.
15. Landlord and Tenant affirm and covenant that each has the authority to enter
into this Fifth Amendment, to abide by the terms hereof, and that the
signatories hereto are authorized representatives of their respective entities
empowered by their respective entities to execute this Fifth Amendment.
16. To the extent the provisions of this Fifth Amendment are inconsistent with
the Lease, the terms of this Fifth Amendment shall control.
17. Except as expressly amended or modified herein, all other terms, covenants
and conditions of the Lease shall remain in full force and effect.
18. The conditions, covenants, and agreements contained herein shall be binding
upon the parties hereto and their respective successors and assigns.
19. Any terms used in this Fifth Amendment as defined terms, but which are not
defined herein, shall have the meanings attributed to those terms in the Lease.
[SIGNATURES APPEAR ON NEXT PAGE]
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IN WITNESS WHEREOF, the parties herein have hereunto set their hands and
seals, the day and year first above written.
WITNESSES TO LANDLORD: LANDLORD:
THE PRUDENTIAL INSURANCE COMPANY
-------------------------------- OF AMERICA, a New Jersey corporation
Print Name:
---------------------
By: Codina Real Estate Management, Inc., its
Agent
-------------------------------- By: /s/ Xxxxxxx X. Xxxxxx
Print Name: -----------------------------------
--------------------- Print Name: Xxxxxxx X. Xxxxxx
Title: President
WITNESSES TO CONCERTO CONCERTO:
CONCERTO SOFTWARE, INC., a Delaware
/s/ Xxxx X. Xxxxxxxx corporation
--------------------------------
Print Name: Xxxx X. Xxxxxxxx
By: /s/ Xxxxxxx X. Xxxxxxxxxx
/s/ Xxxxx Xxxxxxxx-Xxxxx -----------------------------------
-------------------------------- Print Name: Xxxxxxx X. Xxxxxxxxxx
Print Name: Xxxxx Xxxxxxxx-Xxxxx Title: VP Finance and CFO
WITNESSES TO CELLIT: CELLIT:
CELLIT, INC., a Florida corporation
/s/ Xxxx X. Xxxxxxxx
--------------------------------
Print Name: Xxxx X. Xxxxxxxx
By: /s/ Xxxxxxx X. Xxxxxxxxxx
-----------------------------------
Print Name: Xxxxxxx X. Xxxxxxxxxx
/s/ Xxxxx Xxxxxxxx-Xxxxx Title: VP Finance & CFO
--------------------------------
Print Name: Xxxxx Xxxxxxxx-Xxxxx
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