LEASE AGREEMENT
BY AND BETWEEN:
EAST COAST PROPERTY MANAGEMENT LLC
"LANDLORD"
AND
TRANSNET CORPORATION, A DELAWARE CORPORATION
"TENANT"
PREMISES:
▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇, ▇▇▇▇▇ ▇▇
▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇
DATED: April 28th, 2004
----------------
THIS AGREEMENT, made this 28th day of April, 2004, by and between East
Coast Property Management LLC, having an address at ▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇,
▇▇ ▇▇▇▇▇ (the "Landlord") and TransNet Corporation, a Delaware Corporation,
having an address at ▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ (the "Tenant");
WHEREAS, the Landlord intends to lease to the Tenant an industrial-type
building containing approximately 21,246 square feet, outside to outside
dimensions, located on and together with the premises hereinafter referenced
(hereinafter the "Lease Premises:).
NOW, THEREFORE, KNOW ALL MEN BY THESE PRESENTS, that for the rents
reserved, the mutual considerations herein and the parties mutually intending to
be legally bound hereby, the Landlord does demise, lease and let unto the Tenant
and the Tenant does rent and take from the Landlord the Leased Premises as
described in ARTICLE 1, and the Landlord and Tenant do hereby mutually covenant
and agree as follows:
1. LEASED PREMISES
The Leased Premises shall consist of the industrial-type building
containing approximately 21,246 square feet outside dimensions, located on and
together with the lands known as ▇▇▇ ▇▇▇, ▇▇▇▇▇ ▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇
▇▇▇▇▇▇, together with all improvements to be constructed thereon by the Landlord
for the use of the Tenant, together with and subject to all easements,
improvements, tenements, appurtenances, hereditaments, fixture and rights and
privileges appurtenant thereto.
2. TERM OF LEASE
The Landlord leases unto the Tenant and the Tenant hires the
Leased Premises for the term of seven (7) years, to commence on or about March
1, 2004, and to end on February 28, 2011.
3. RENT
3.1 The Tenant covenants and agrees to pay the annual rent
("Base Rent") as follows:
(a) During the first and second years of the seven (7) year
lease term, Base Rent shall be in the amount of ONE HUNDRED SIXTY-FIVE THOUSAND
SEVEN HUNDRED EIGHTEEN AND 80/00 DOLLARS ($165,718.80) per annum, payable in
equal installments of THIRTEEN THOUSAND EIGHT HUNDRED NINE AND 90/00 DOLLARS
($13,809.90) per month (the "Original Base Rent").
2
(b) During the third through seventh years of the seven (7)
year lease term, Base Rent shall be in the amount of ONE HUNDRED EIGHTY-FIVE
THOUSAND SIX HUNDRED FIVE AND 05/00 DOLLARS ($185,605.05) per annum, payable in
equal installments of FIFTEEN THOUSAND FOUR HUNDRED SIXTY-SEVEN AND 08/00
DOLLARS ($15,467.08) per month.
(c) All of the foregoing monthly payments shall be made
promptly in advance on the first day of each and every month during the term of
the lease without demand and without offset or deduction, together with such
additional rent and other charges required to be paid by Tenant as are
hereinafter set forth.
3.2 Any installment of Base Rent accruing hereunder and any
other sum payable hereunder by Tenant to Landlord, which is not paid prior to
the FIFTH (5TH) business day of any lease month shall require payment by Tenant
of a late charge of five ($.05) cents for each dollar of rental payment
required, which payment shall be made in such event by Tenant with the required
payment of Base Rent, if late, and which payment in any event shall be made by
Tenant upon demand if not otherwise theretofore paid.
3.3 Tenant covenants and agrees that in the event of any
material dispute with respect to the within Lease, its obligation to pay the
rent shall continue without abatement notwithstanding any such dispute, and the
Tenant agrees that it shall seek such remedies as the law may allow by way of
plenary proceedings with respect to such issues in dispute.
3.4 Receipt and acceptance by Landlord of any Base Rent,
additional rent and any other charge with knowledge of Tenant's default in any
covenant or condition of this Lease shall not be deemed a waiver of such
default.
3.5 Simultaneously with the execution hereof, the Tenant has
delivered to the Landlord the first month's Base Rent payable hereunder,
together with the security deposit referred to herein.
4. USE
The Tenant covenants and agrees to use and occupy the Leased
Premises for office and warehouse purposes only, which use by Tenant, however,
is and shall be expressly subject to all applicable zoning ordinances, rules and
regulations of any governmental boards or bureaus having jurisdiction hereof.
The Tenant shall continue in full force and effect the current certificate of
occupancy permitting Tenant's use and occupancy of the Leased Premises. In the
event that any future improvements or changes require a new Certificate of
Occupancy, the Tenant shall obtain same at its sole cost and expense.
3
5. CONDITION OF THE LEASED PREMISES
Anything herein contained to the contrary notwithstanding, it is
expressly understood and agreed that the Tenant shall take the Leased Premises
and improvements as of the Commencement Date of the within Lease in an "as is"
condition, without Landlord having any obligation to make any improvements or
alterations therein.
6. COMPLIANCE WITH LAWS, RULES AND REGULATION
6.1(i) The Tenant covenants and agrees that upon acceptance and
occupancy of the Leased Premises, it will, during the Lease term, promptly, at
Tenant's cost and expense, execute and comply with all statutes, ordinances,
rules, orders, regulations and requirements of the Federal, State and City
Government and of any and all their departments and bureaus, applicable to the
Leased Premises, as the same may require correction, prevention and abatement of
nuisances, violations or other grievances, in, upon or connected with the Leased
Premises, arising from the operations of the Tenant therein.
(ii) The Tenant covenants and agrees, at its own cost and
expense, to comply with such regulations or requests as may be required by the
fire or liability insurance carriers providing insurance for the Leased
Premises, and will further comply with such other requirements that may be
promulgated by the Board of Fire Underwriters, in connection with the use and
occupancy by the Tenant of the Leased Premises in the conduct of its business.
(iii) The Tenant covenants and agrees that it will not commit any
nuisance, nor permit the emission of any objectionable sound, noise or odors
which would be violative of any applicable governmental rule or regulation or
would per se create a nuisance. The Tenant further covenants and agrees that it
will handle and dispose of all rubbish, garbage and waste in connection with the
Tenant's operations in the Leased Premises in accordance with reasonable
regulations established by the Landlord from time to time in order to keep the
premises in an orderly condition and in order to avoid unreasonable emission of
dirt, fumes, orders or debris which may constitute a nuisance or induce pests or
vermin.
6.2 In case the Tenant shall fail or neglect to comply with the
aforesaid statutes, ordinances, rules, orders, regulations and requirements of
any of them, or in case the Tenant shall neglect or fail to make any necessary
repairs, then the Landlord or the Landlord's agents may after fifteen (15) days'
notice (except for emergency repairs, which may be made immediately) enter said
premises and make said repairs and comply with any and all of the said statutes,
ordinances, rules, orders, regulations
4
or requirements, at the cost and expense of the Tenant and in case of the
Tenant's failure to pay therefore, the said cost and expense shall be added to
the next month's rent and be due and payable as such, or the Landlord may deduct
the same from the balance of any sum remaining in the Landlord's hands. This
provision is in addition to the right of the Landlord to terminate this Lease by
reason of any default on the part of the Tenant, subject to the rights of the
Tenant as herein mentioned in the manner as in this Lease otherwise provided.
6.3 Without limiting anything herein contained in this ARTICLE 14,
Tenant expressly covenants and agrees to fully comply with the provisions of the
New Jersey Industrial Site Recovery Act (N.J.S.A. 13:1K-6, et seq.) hereinafter
referred to as "ISRA", and all regulations promulgated thereto. Tenant agrees
that it shall fully cooperate with Landlord in connection with any information
or documentation which may be requested by the New Jersey Department of
Environmental Protection. In the event that a cleanup of the Property is
required in connection with the conduct by Tenant of its business in the Leased
Premises, Tenant expressly covenants and agrees that it shall be responsible for
that portion of said cleanup which is attributable to the Tenant's use and
occupancy thereof. Tenant hereby represents and warrants that its Standard
Industrial Classification No. is 5734, 7377 and 7378, and that Tenant shall not
generate, manufacture, refine, transport, treat, store, handle or dispose of
"hazardous substances" as the same are denied under ISRA and the regulations
promulgated pursuant thereto. Tenant hereby agrees that it shall promptly inform
Landlord of any change in its SIC number or the nature of the business to be
conducted in the Leased Premises. The within covenants shall survive the
expiration of earlier termination of the Lease term.
7. UTILITIES
The Tenant shall, at its own cost and expense, pay all utility
meter, deposit and service charges, including gas, sewer, electric, water and
standby sprinkler charges, if any, together with janitorial service and garbage
removal.
8. TAXES
8.1 The Tenant, in addition to the rent reserved, shall, during
the term of the Lease, promptly pay (before any fine, penalty, interest or cost
shall be added thereto), at its cost and expenses when the same shall be
lawfully due and payable, all real estate and personal property taxes assessed
against the Leased Premises for land, building and improvements, including such
added assessment or omitted assessment, which may be levied against the Leased
Premises for the year 2004, et seq., by the applicable governmental taxing
authority, said obligation to be prorated as of the Commencement Date and as of
the date of expiration hereunder as applicable. In addition to the obligation to
pay real estate taxes as herein set forth, the Tenant shall, during the term of
this Lease, pay at its costs
5
and expense any levy for the installation of local improvements affecting the
Leased Premises as may be assessed by any governmental boards or bureaus having
jurisdiction thereof. Any assessment or impositions for capital or public
improvements, which may be payable by law at the option of the taxpayer in
installments, may be so paid by the Tenant in installments, together with any
required interest. The real estate tax obligation of the Tenant herein set forth
shall include, if levied any tax or imposition which may be levied by any
governmental authority, agency or subdivision thereof having jurisdiction
applicable to parking lot usage. The Tenant agrees that it shall, within thirty
(30) days after written demand by Landlord, furnish in writing to Landlord
evidence of payment of the then current and applicable real estate taxes
required to be paid by Tenant.
8.2 In the event the Tenant wishes to contest any assessment or
levy of taxes on the premises herein demised, the Landlord covenants and agrees
that it will lend its name and execute all necessary papers to aid the Tenant in
contesting or litigating said assessment, provided, however, that said
litigation or contest shall be at the cost and expense of the Tenant. Any
resultant reduction or rebate of taxes, paid or to be paid by the Tenant, shall
belong to Tenant.
8.3 If at any time during the term of this Lease the method or
scope of taxation prevailing at the commencement of the Lease term shall be
altered, modified or enlarged to as to cause the method of taxation to be
changed, in whole or in parts, so that in substitution for the real estate taxes
now assessed there may be, in whole or in part, a capital levy or other
imposition based on the value of the premises, or the rents received therefrom,
or some other form of assessment based in whole or in part on some other
valuation of the Landlord's real property comprising the Leased Premises, then
and in such event, such substituted tax or imposition shall be payable and
discharged by the Tenant in the manner required pursuant to such law promulgated
which shall authorize such change in the scope of taxation, and as required by
the terms and conditions of the within Lease.
8.4 Nothing in this Lease contained shall require the Tenant to
pay any franchise, estate, inheritance, succession, capital levy or transfer tax
of the Landlord, or Federal Income Tax, State Income Tax, or excess profits or
revenue tax, unless such taxes are in substitution for real property taxes as a
result of such change in the manner and scope of taxation. Any substitute tax as
herein referred to shall be computed as if the lease property were the sole
property owned by the Landlord.
9. INSURANCE
9.1 The Tenant will, at its sole cost and expense, obtain for
the benefit of the Landlord, wherein the Landlord shall be the named insured,
fire and
6
casualty insurance with full extended coverage, including flood insurance if the
Lease Premises are located in a flood hazard zone as designated by HUD, in an
amount and value equivalent to the full replacement value of all the insurable
improvements located on the lands forming a part of the Lease Premises, without
any deductible clause exceeding $1,000.00, which policy of insurance shall
include broad form boiler and machinery coverage (inclusive of air-conditioning
system, if any), together with insurance coverage against sprinkler damage to
the building and its improvements. For the purpose of this Lease, the initial
replacement value shall be established at ONE MILLION EIGHT HUNDRED THOUSAND AND
00/00 DOLLARS ($1,800,000.00). The Landlord shall have the right from time to
time to determine the full replacement value as may be required to comply with
full replacement insurance requirements. The insurance to be obtained shall
include casualty rent insurance payable to and insuring the interest of the
Landlord as to the value of the rental obligation hereunder to the extent of one
(1) year's gross rental value, (inclusive of real estate taxes and applicable
insurance premiums).
9.2 The Tenant covenants and agrees that it will, at its sole
cost and expense, carry liability insurance covering the Leased premises and in
the minimum amount of THREE MILLION AND 00/00 DOLLARS ($3,000,000.00). Said
policy shall be a single limit policy. The Tenant further covenants and agrees
that it will add as a party insured by such policy the interest of the Landlord
and will furnish Landlord with a certificate of said liability insurance prior
to the commencement of the term of this Lease. The Tenant agrees that such
insurance coverage will be maintained in full force and effect during the term
of the Lease.
9.3 It is expressly understood and agreed that all policies of
insurance shall contain a clause that the same shall not be cancelled except on
ten (10) days' written notice to any and all parties in interest.
9.4 The parties hereto mutually covenant and agree that each
party, in connection with insurance policies required to be furnished in
accordance with the terms and conditions of this Lease, or in connection with
insurance policies which they obtain insuring such insurable interest as
Landlord or Tenant may have in its own properties, whether personal or real,
shall expressly waive any right or subrogation on the part of the insurer
against the Landlord or Tenant as the same may be applicable, which right to the
extent not prohibited or violative of any such policy is hereby expressly
waived, and Landlord and Tenant each mutually waive all right of recovery
against each other, their agents or employees for any loss, damage or injury of
any nature whatsoever to property or person for which either party has insurance
coverage.
7
10. SIGNS
The Tenant shall have the right and privilege of erecting on and
at the Leased Premises only such signs as are required by Tenant for the purpose
of identifying the Tenant, which signs must be approved by the Landlord in
writing, which approval shall not be unreasonably withheld or delayed. The said
signs shall comply with the applicable rules and regulations of the applicable
governmental boards and bureaus having jurisdiction thereof. The erection of
such signs shall not cause any structural damage to the building. It is
expressly understood and agreed that the Tenant shall not erect roof signs.
11. FIXTURES
11.1 The Tenant is given the right and privilege of installing
and removing property, equipment and fixtures in the Lease Premises during the
term of the Lease. However, if the Tenant is in default and moves out, or is
dispossessed, and fails to remove any property, equipment and fixtures or other
property within (30) days after such default, dispossess or removal, then and in
that event, the said property, equipment and fixtures or other property shall be
deemed at the option of the Landlord, to be abandoned; or in lieu thereof, at
the Landlord's option, the Landlord may remove such property and charge the
reasonable cost and expense of removal and storage to the Tenant.
11.2 Anything to the contrary contained herein notwithstanding,
it is expressly understood and agreed that the Tenant may install, connect and
operate equipment as may be deemed necessary by the Tenant for its business,
subject to compliance with applicable rules and regulations of governmental
boards and bureaus having jurisdiction thereof. Subject to the terms and
conditions of this Lease, the machinery, fixtures and equipment belonging to the
Tenant shall at all times be considered and intended to be personal property of
the Tenant, and not part of the realty, and subject to removal by the Tenant,
provided at the time of such removal, that the Tenant is not in default pursuant
to the terms and conditions of this Lease, and that the Tenant, at its own cost
and expense, pays for any damage to the Leased Premises caused by such removal.
12. SECURITY
Upon execution of this Lease, the Tenant shall deposit with the
Landlord the sum of TWENTY-SEVEN THOUSAND SIX HUNDRED NINETEEN AND 80/00 DOLLARS
($27,619.80) AS SECURITY FOR THE FULL AND FAITHFUL PERFORMANCE OF THIS Lease
upon the part of the Tenant to be performed. Upon termination of this Lease, and
providing the Tenant is not in default hereunder and has performed all of the
conditions of this Lease, the Landlord shall return the said sum of TWENTY-SEVEN
THOUSAND SIX HUNDRED NINETEEN AND 80/00 DOLLARS ($27,619.80) to the Tenant.
Anything herein contained to the contrary notwithstanding, it is expressly
8
understood and agreed that the said security deposit shall not bear interest.
Tenant covenants and agrees that it will not assign, pledge, hypothecate,
mortgage or otherwise encumber the aforementioned security during the term of
this Lease. It is expressly understood and agreed that the Landlord shall have
the right to co-mingle the security funds with its general funds and said
security shall not be required to be segregated.
13. FIRE AND CASUALTY
13.1 In the case of any damage to or destruction of any of the
buildings or structures on the Leased Premises by fire or other casualty
occurring during the term of this Lease which is not covered by the insurance
required to be carried by ARTICLE 9.1, or which cannot be repaired within one
hundred eighty (180) days from the happening of such casualty, then, in such
event, the term hereby created shall, at the option of either party, upon
written notice to the other by certified mail, return receipt requested, within
thirty (30) days of such fire or casualty, cease and become null and void from
the date of such destruction or damage. However, if neither party shall elect to
cancel this Lease within the thirty (30) day period hereinabove provided, the
Landlord shall thereupon repair and restore the Leased Premises with reasonable
speed and dispatch, and the rent shall not be accrued after said damage or while
the repairs and restorations are being made, but shall recommence immediately
after said premises are restored. Landlord, in any event, shall advise Tenant in
writing as to whether or not the Leased Premises can be restored within the one
hundred eighty (180) day period from the date of such casualty. Anything in this
ARTICLE 13 to the contrary notwithstanding, it is expressly understood and
agreed that the Landlord shall be obligated to restore the Leased Premises only
to the extent of such cost as will be equivalent to the proceeds received by
Landlord pursuant to the fire insurance coverage to be provided to Landlord as
in ARTICLE 9 provided. If the insurance proceeds are not sufficient to restore
the premises to substantially the same condition which they were in prior to the
casualty, then the Landlord shall have a period of thirty (30) days within which
to determine whether to terminate the term hereby created unless the Landlord
and Tenant shall mutually agree to the funding of any such excess construction
costs. In the event of cancellation in accordance with this Article, the Tenant
shall immediately surrender the Leased Premises and the Tenant's interest in
said Lease to the Landlord, and the Tenant shall only pay rent to the time of
such destruction or damage, in which event, the Landlord may re-enter and
repossess the Leased Premises thus discharged from this Lease and may removal
all parties therefrom.
13.2 Nothing herein contained with respect to the Tenant's right
to ▇▇▇▇▇ rent under proper conditions shall be construed to limit or affect the
Landlord's right to payment under any claim for damages covered by the rent
insurance policy pursuant to the contract therefore required to be provided
pursuant to ARTICLE 9 of this Lease.
9
13.3 For the purposes of this ARTICLE 13, in determining what
constitutes reasonable speed and dispatch, consideration shall be given for
delays which would be excuses for non-performance as in ARTICLE 24 hereinafter
provided (Force Majeure).
13.4 In the event of such fire or casualty as above provided,
wherein the Landlord shall rebuild, the Tenant agrees, as its cost and expense,
to forthwith remove any and all of its equipment, fixtures, stock and personal
property as the same may be required to permit Landlord to expedite rebuilding
and/or repair. In any event, the Tenant shall assume at its sole risk the
responsibility for damage or security with respect to such fixtures and
equipment in the event the building area where the same may be located has been
damaged, until the building shall be restored and made secure.
13.5 Anything in this ARTICLE 13 to the contrary
notwithstanding, it is expressly understood and agreed that wherever
reconstruction shall be undertaken, in the event of damage or casualty as in
this ARTICLE 13 provided, the Landlord shall prosecute such reconstruction with
reasonable speed and dispatch. In the event, however, such reconstruction or
repair shall not be completed within six (6) months from the date of such damage
or casualty, then, in that event, the Tenant shall have the option at the
expiration of the six (6) month period to terminate the Lease by notice in
writing by Tenant to Landlord by certified mail, return receipt requested. In
the event of such termination, neither party shall thereafter have any further
liability, one to the other, in accordance with the terms and conditions of the
Lease. The Landlord during such period of reconstruction shall give the Tenant
reasonable notice at least thirty (30) days in advance of the date on which the
building shall be ready for re-occupancy.
14. REPAIR AND MAINTENANCE
14.1 During the term of the Lease, and during the term of any
renewals or extensions thereof, the Tenant shall, at its sole cost and expense,
take good care of the Leased Premises, make any and all necessary repairs to the
Leased Premises and shall, at the end of the expiration of the term, deliver up
the Leased Premises in good order and condition.
14.2 The Tenant, at its cost and expense, shall (i) maintain,
repair and replace the lawns, shrubbery, driveways and parking arrears; (ii)
keep the parking area and driveways, sidewalks and steps of the Leased Premises
free and clear of ice and snow; and (iii) keep the exterior of the Leased
Premises free and clear of paper, and other debris so as to keep same in a good
and orderly manner.
10
15. INSPECTION BY LANDLORD
The Tenant agrees that the said Landlord's agents, and other
representatives, shall have the right, during normal business hours, to enter
into and upon the Leased Premises, or any part thereof, at all reasonable hours
for the purpose of examining the same, or for exhibiting the same to prospective
tenants and purchasers in the presence of a representative of Tenant (except in
the event of emergency) or making such repairs or alterations therein as may be
necessary for the safety and preservation thereof, without unduly or
unreasonably disturbing the operations of the Tenant (except in the event of
emergency).
16. DEFAULT BY TENANT
16.1 Each of the following shall be deemed a default by Tenant
and breach of this Lease:
(1) (i) Filing of a petition by the Tenant for adjudication as a
bankrupt, or for reorganization, or for an arrangement
under any Federal or State Statute;
(ii) Dissolution or liquidation of the Tenant;
(iii) Appointment of a permanent receiver or a permanent trustee
of all or substantially all the property of the Tenant;
(iv) Taking possession of the property of the Tenant by a
governmental officer or agency pursuant to statutory authority for dissolution,
rehabilitation, reorganization or liquidation of the Tenant;
(v) Making by the Tenant of an assignment for the benefit of
creditors;
(vi) Abandonment, desertion or vacation of the Leased Premises
by the Tenant.
If any event mentioned in this subsection (1) shall occur,
Landlord may thereupon or at any time thereafter elect to cancel this Lease by
ten (10) days notice to the Tenant, and this Lease shall terminate on the day in
such notice specified with the same force and effect as if that date were the
date herein fixed for the expiration of the term of the Lease.
(2) (i) Default in the payment of the Base Rent or additional rent
herein reserved or any part thereof for a period of seven (7) days after the
same is due and payable as in this Lease required;
11
(ii) A default in the performance of any other covenant or
condition of this Lease on the part of the Tenant to be performed for a period
of thirty (30) days after notice. For purposes of this subdivision (2) (ii)
hereof, no default on the part of Tenant in performance of work required to be
performed or acts to be done or conditions to be modified shall be deemed to
exist if steps shall have been commenced by Tenant diligently after notice to
rectify the same and shall be prosecuted to completion with reasonable
diligence, subject, however, to unavoidable delays.
16.2 In case of any such default under ARTICLE 16.1 (2) and at
any time thereafter following the expiration of the respective grace periods
above mentioned, or in the event that Tenant is consistently late in the
punctual payment of Base Rent and/or additional rent required to be paid under
this Lease as shall be evidenced by late payments made during any period of four
(4) consecutive months during any twelve (12) month period measured from the
date of the first late payment, Landlord may serve a notice upon the Tenant
electing to terminate this Lease upon a specified date not less than seven (7)
days after the date of serving such notice and this Lease shall then expire on
the date so specified as if that date has been originally fixed as the
expiration date of the term herein granted; however, a default under ARTICLE
16.1 (2) hereof shall be deemed waived if such default is made good before the
date specified for termination in the notice of termination served on Tenant.
16.3 In case this Lease shall be terminated as hereinbefore
provided, or by summary proceedings or otherwise, Landlord or its agents may,
immediately or any time thereafter, re-enter and resume possession of the Leased
Premises or such part thereof, and remove all persons and property therefrom,
either by summary proceedings or by a suitable action or proceeding at law
without being liable for any damages, provided any entry pursuant to the
foregoing shall be in accordance with law. No re-entry by Landlord shall be
deemed an acceptance of a surrender of this Lease.
16.4
(1) In case this Lease is terminated by summary proceedings, or
otherwise, as provided in this ARTICLE 16, and whether or not the premises is
relet, Landlord shall be entitled to recover from the Tenant, the following:
(i) A sum equal to all expenses, if any, including reasonable
counsel fees, incurred by Landlord in recovering possession of the Leased
Premises, and all reasonable costs and charges for the care of said premises
while vacant, which damages shall be due and payable by Tenant to Landlord at
such time or time as such expenses shall have been incurred by Landlord;
12
(ii) A sum equal to all damages set forth in this ARTICLE 16 and
in ARTICLE 17 hereinafter referred to.
(2) Without any previous notice or demand, separate actions may be
maintained by Landlord against Tenant from time to time to recover any damages,
which, at the commencement of any such action, have then or theretofore become
due and payable to the Landlord under this ARTICLE 16 and subsections hereof
without waiting until the end of the then current term.
(3) All sums which tenant has agreed to pay by way of taxes, sewer
charges, water rents or water meter charges, insurance premiums and other
similar items becoming due from time to time under the terms of this Lease,
shall be deemed additional rent reserved in this Lease within the meaning of
this ARTICLE 16 and subsections hereof.
17. LIABILITY OF TENANT FOR DEFICIENCY
In the event that the relation of the Landlord and Tenant may
cease or terminate by reason of the default by the Tenant and the re-entry of
the Landlord as permitted by the terms and conditions contained in this Lease or
by the ejectment of the Tenant by summary proceedings or other judicial
proceedings, or after the abandonment of the Leased Premises by the Tenant, it
is hereby agreed that the Tenant shall remain liable to pay in monthly payments
the rent which shall accrue subsequent to the re-entry by the Landlord, and the
Tenant expressly agrees to pay as damages for the breach of the covenants herein
contained the difference between the rent reserved and the rent collected and
received, if any, by the Landlord, during the remainder of the unexpired term,
as the amount of such difference or deficiency shall from time to time be
ascertained. Anything herein contained to the contrary notwithstanding, the rent
referred to shall include the stated reserved Base Rent together with all
additional rent and charges required to be paid by the Tenant under the Lease
including but not limited to taxes and insurance costs, and the costs of
re-renting.
18. NOTICES
All notices required or permitted to be given to the Landlord
shall be given by certified mail, return receipt requested, at the address
hereinbefore set forth on the first page of this Lease, and/or such other place
as the Landlord may designate in writing.
All notices required or permitted to be given to the Tenant shall
be given by certified mail, return receipt requested, at the address
hereinbefore set forth on the first page of this Lease, and/or such other place
as the Tenant shall designate in writing.
13
19. NON-WAIVER BY LANDLORD
The failure of the Landlord to insist upon strict performance of
any of the covenants or conditions of this Lease or to exercise any option of
the Landlord herein conferred in any one or more instances, shall not be
construed as a waiver by the Landlord of any of its rights or remedies in this
Lease, and shall not be construed as a waiver, relinquishment or failure of any
such covenants, conditions, or options, but the same shall be and remain in full
force and effect.
20. RIGHT OF TENANT TO MAKE ALTERATIONS AND IMPROVEMENTS
The Tenant may make alterations, additions or improvements to the
Leased Premises only with the prior written consent of the Landlord, which
consent shall not be unreasonably withheld, provided such alterations, additions
or improvements do not require structural changes in the Leased Premises, or do
not lessen the value of the Leased Premises. Any consent which Landlord may give
shall be conditioned upon Tenant furnishing to Landlord, detailed plans and
specifications with respect to any such changes, to be approved by Landlord in
writing. As a condition of such consent, Landlord reserves the right to require
Tenant to remove, at Tenant's sole cost and expense, any such alterations or
additions prior to the expiration of the Lease term. If Landlord does not
require such removal, any such alterations or additions shall be deemed to be
part of the realty upon installation, provided that Tenant, at its option, shall
have the right to remove the same, provided it shall be responsible to repair
any damage to the premises occasioned by such removal, provided such removal is
made prior to the expiration of the Lease term. All such alterations, additions
or improvements shall be only in conformity with applicable governmental and
insurance company requirements and regulations applicable to the Leased
Premises. Tenant shall hold and save Landlord harmless and indemnify Landlord
against any claim for damage or injury in connection with any of the foregoing
work which Tenant may make as herein provided.
21. NON-LIABILITY OF LANDLORD
21.1 It is expressly understood and agreed by and between the
parties to this agreement that the Tenant shall assume all risk of damage to its
property, equipment and fixtures occurring in or about the Leased Premises,
whatever the cause of such damage or casualty.
21.2 It is expressly understood and agreed that in any event,
the Landlord shall not be liable for any damage or injury to property or person
caused
14
by or resulting from steam, electricity, gas, water, rain, ice or snow, or any
leak or flow from or into any part of the Leased Premises, or from any damage or
injury resulting or arising from any other cause or happening whatsoever.
22. RESERVATION OF EASEMENT
The Landlord reserves the right, easement and privilege to enter
on the Leased Premises in order to install, at its own cost and expense, any
storm drains and sewers and/or utility lines in connection therewith as may be
required by the Landlord. It is understood and agreed that if such work as may
be required by Landlord requires any installation which may displace any paving,
lawn, seeded area or shrubs, the Landlord, shall, at its own cost and expense,
restore said paving, lawn, seeded area or shrubs. The Landlord covenants that
the foregoing work shall not unreasonably interfere with the normal operation of
Tenant's business, and the Landlord shall indemnify and save the Tenant harmless
in connection with such installations.
23. AIR, WATER AND GROUND POLLUTION
The Tenant expressly covenants and agrees to indemnify, defend,
and save the Landlord harmless against any claim, damage, liability, costs,
penalties, or fines which the Landlord may suffer as a result of air, water or
ground pollution caused by the Tenant in its use of the Leased Premises. The
Tenant covenants and agrees to notify the Landlord immediately of any claim or
notice served upon it with respect to any such claim that the Tenant is causing
water, air or ground pollution; and the Tenant, in any event, will take
immediate steps to halt, remedy or cure any pollution of air, water or ground
caused by the Tenant by its use of the Leased Premises. The within covenant on
the part of the Tenant shall survive the expiration or earlier termination of
this Lease.
24. FORCE MAJEURE
Except for the obligation of the Tenant to pay rent and other
charges as in this Lease provided, the period of time during which the Landlord
or Tenant is prevented from performing any act required to be performed under
this Lease by reason of fire, catastrophe, strikes, lockouts, civil commotion,
acts of God or the public enemy, government prohibitions or preemptions,
embargoes, inability to obtain material or labor by reason of governmental
regulations or prohibitions, the act or default of the other party, or other
events beyond the reasonable control of Landlord or Tenant, as the case may be,
shall be added to the time for performance of such act.
15
25. CONDEMNATION
25.1 If due to condemnation or taking or seizure by any
authority having the right of eminent domain (i) more than twenty-five (25%) per
cent of the building on the Leased Premises is taken, or (ii) in the event that
more than twenty-five (25%) percent of the ground is taken (including the
parking areas, but exclusive of front, side and rear set back areas), or (iii)
if access to the Leased Premises be denied, which taking in the manner herein
referred to and in excess of the foregoing percentage amounts shall unreasonably
or unduly interfere with the use of the building, ground area, parking area, or
deny access to these premises, then and in either of such events as herein
provided, the Lease term created shall, at the option of the Tenant, terminate,
cease and become null and void from the date when the authority exercising the
power of eminent domain takes or interferes with the use of the building on the
Leased Premises, its use of the ground area, parking area, or area of access to
the Leased Premises. The Tenant shall only be responsible for the payment of
rent until the time of surrender. In any event, no part of the Landlord's
condemnation award shall belong to or be claimed by the Tenant. Without
diminishing Landlord's award, the Tenant shall have the right to make a claim
against the condemning authority for such independent claim which it may have
and as may be allowed by law, for costs and damages due to relocating, moving
and other similar costs and charges directly incurred by the Tenant and
resulting from such condemnation.
25.2 In the event of any partial taking which would not be cause
for termination of the within Lease or in the event of any partial taking in
excess of the percentages provided in ARTICLE 25.1, and in which event the
Tenant shall elect to retain the balance of the Leased premises remaining after
such taking, then and in either event, the rent shall ▇▇▇▇▇ in an amount
mutually to be agreed upon between the Landlord and Tenant based on all the
relationship that the character of the property taken bears to the property
which shall remain after such condemnation. In any event, no part of the
Landlord's condemnation award shall belong to or be claimed by the Tenant.
However, the Landlord shall, to the extent permitted by applicable law and as
the same may be practicable on the site of the Leased premises, at the
Landlord's sole cost and expense, promptly make such repairs and alterations in
order to restore the building and/or improvements to the extent of the
condemnation award.
26. QUIET ENJOYMENT
The Landlord further covenants that the Tenant, on paying the
rental and performing the covenants and conditions contained in this Lease,
shall and may peaceably and quietly have, hold and enjoy the Leased Premises for
the term aforesaid.
16
27. SURRENDER OF PREMISES
On the last day, or earlier permitted termination of the Lease
term, Tenant shall quit and surrender the premises in good and orderly condition
and repair (reasonable wear and tear, and damage by fire or other casualty
excepted) and shall deliver and surrender the Leased Premises to the Landlord
peaceably, together with all alterations, additions and improvements in, to or
on the premises made by Tenant as permitted under the Lease. The Landlord
reserves the right, however, to require the Tenant at its cost and expense to
remove any alterations or improvements installed by the Tenant and not permitted
or consented to by the Landlord pursuant to the terms and conditions of the
Lease, which covenant shall survive the surrender and the delivery of the
premises as provided hereunder. Prior to the expiration of the Lease term the
Tenant shall remove all of its property, fixtures, equipment and trade fixtures
from the premises. All property not removed by Tenant shall be deemed abandoned
by Tenant, and Landlord reserves the right to charge the reasonable cost of such
removal to the Tenant, which obligations shall survive the Lease termination and
surrender herein provided. If the premises shall not be surrendered at the end
of the Lease term, Tenant shall be responsible to pay Landlord, monthly, an
amount equal to twice the monthly installment of annual rent payable by Tenant
prior to the expiration or earlier termination of this Lease for each month or
part thereof that Tenant holds over in the Leased premises.
28. INDEMNITY
Anything in this Lease to the contrary notwithstanding, and
without limiting the Tenant's obligation to provide insurance pursuant to
ARTICLE 9 hereunder, the Tenant covenants and agrees that it will indemnify,
defend and save harmless the Landlord against and from all liabilities,
obligations, damages, penalties, claims, costs, charges and expenses, including
without limitation, reasonable attorney's fees, which may be imposed upon or
incurred by Landlord by reason arising from Tenant's use of the premised, except
for any such claims, actions, demands, judgment, damages, liabilities or
expenses arising from the intentional acts or omissions of Landlord, its agents,
employees or contractors.
29. LEASE CONSTRUCTION
This Lease shall be construed pursuant to the laws of the State of
New Jersey.
30. BIND AND INURE CLAUSE
The terms, covenants and conditions of the within Lease shall be
binding upon and inure to the benefit of each of the parties hereto, their
respective executors, administrators, heirs, successors and assigns, as the case
may be.
17
31. NET RENT
It is the purpose and intent of the Landlord and Tenant that the
rent shall be absolutely net to Landlord, so that this Lease shall yield, net,
to Landlord, the rent specified in ARTICLE 3 hereof in each month during the
term of the Lease, and that all costs, expenses and obligations of every kind
and nature whatsoever relating to the Leased Premises, which may arise or become
due during or out of the term of this Lease, shall be paid by the Tenant, except
for such obligations and charges as have otherwise expressly been assumed by the
Landlord in accordance with the terms and conditions of the Lease. Nothing
herein shall require the Tenant to undertake obligations in connection with the
sale or mortgaging of the Leased Premises, unless otherwise expressly provided
in accordance with the terms and conditions of this Lease.
32. COVENANTS OF FURTHER ASSURANCES
If, in connection with obtaining financing for the improvements on
the Leased Premises, the Mortgage Lender shall request reasonable modifications
in this Lease as a condition to such financing, Tenant will not unreasonably
withhold, delay or refuse its consent thereto, provided that such modifications
do not in Tenant's reasonable judgment increase the obligations of Tenant
hereunder or materially adversely affect the leasehold.
33. LANDLORD'S REMEDIES
The rights and remedies given to the Landlord in this Lease are
distinct, separate and cumulative remedies, and no one of them, whether or not
exercised by the Landlord, shall be deemed to be in exclusion of any of the
others.
34. SUBORDINATION OF LEASE
This Lease shall be subject and subordinate at all times to the
lien of any bona fide mortgages now or hereafter placed on the land and building
and Leased Premises without the necessity of any further instrument or act on
the part of Tenant to effectuate such subordination, but Tenant covenants and
agrees to execute and deliver upon demand such further instrument or instruments
evidencing such subordination of the Lease to the lien of any such mortgage or
ground rent or other encumbrances as shall be desired by a mortgagee or proposed
mortgagee or by any person.
18
35. ASSIGNMENT AND SUBLETTING
35.1 The Tenant shall not transfer, assign, sublet or otherwise
alienate its interest in and to the premises without first obtaining the written
consent of the Landlord, which consent shall not be unreasonably withheld. Any
assignment, subletting or license of the Lease or of Tenant's Leasehold interest
in the premises without the prior written consent of Landlord shall be null and
void.
35.2 Notwithstanding, Landlord reserves the right to refuse to
give its consent to any assignment, subletting or transfer of Tenant's interest
in the Premises unless Tenant remains fully liable for the performance of the
Tenant's covenants and obligations under this Lease.
36. SURVIVAL OF OBLIGATION
It is expressly understood and agreed that in the event there are
any obligations of Tenant with respect to payment or performance as required
under the terms and conditions of this Lease that shall have not been performed
prior to the expiration or termination of the Lease in accordance with its
terms, such obligation, including the obligation to make rent adjustments and
other lease adjustments, shall survive the expiration or termination of the
Lease term and surrender of the Leased Premises by the Tenant to the Landlord.
37. OPTION TO RENEW
37.1 Provided the Tenant is not in default pursuant to the terms
and conditions of this Lease, the Tenant is hereby given the right and privilege
to renew the within Lease, for one seven (7) year renewal period to commence at
the end of the initial term of this Lease, which renewal shall be upon the same
terms and conditions as in this Lease contained, except as follows:
(a) During the seven (7) year renewal period, Tenant shall pay
Base Rent in accordance with ARTICLE 3 hereof as follows:
(i) During the first through seventh year of the seven
(7) year renewal term, Base Rent shall be in the amount of TWO HUNDRED THIRTEEN
THOUSAND FOUR HUNDRED FORTY-FIVE AND 80/00 DOLLARS ($213,445.80) per annum,
payable in equal installments of SEVENTEEN THOUSAND SEVEN HUNDRED EIGHTY-SEVEN
AND 15/00 DOLLARS ($17,787.15) per month, and;
37.2 The right, option, and privilege of the Tenant to renew
this Lease as herein set forth is expressly conditioned upon the Tenant
delivering to the Landlord, in writing, by certified mail, return receipt
requested, nine (9) months prior notice of its intention to renew, which notice
shall be given to the Landlord by the Tenant no later than nine (9) months prior
to the date fixed for termination of the original term of this Lease.
19
IN WITNESS WHEREOF, the parties have hereunto set their hands and seals
or caused these presents to be signed by its proper corporate officers and
caused its proper corporate seal to be hereunto affixed, the day and year first
above written.
WITNESS: EAST COAST PROPERTY
MANAGEMENT LLC (Landlord)
/s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇
-------------------- ----------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇, Member
By: /s/ ▇▇▇ ▇. ▇▇▇▇▇▇
----------------------------------
▇▇▇ ▇. ▇▇▇▇▇▇, Member
WITNESS: TRANSNET CORPORATION (Tenant)
/s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇
-------------------- ----------------------------------
Title: Board Chairman
----------------
20