EXHIBIT 10.5
FIRST INDUSTRIAL PENNSYLVANIA, L.P.
STANDARD FORM
INDUSTRIAL BUILDING LEASE
(SINGLE TENANT)
1. BASIC TERMS. This SECTION 1 contains the Basic Terms of this Lease
between Landlord and Tenant, named below. Other Sections of the Lease referred
to in this SECTION 1 explain and define the Basic Terms and are to be read in
conjunction with the Basic Terms.
1.1. Date of Lease: JULY 12, 2000
1.2. Landlord: First Industrial Pennsylvania, L.P., a
Delaware limited partnership
1.3. Tenant: Protarga, Inc. a Delaware corporation
1.4. Premises: Lot, Building (11,256 square feet),
Improvements and Property known as ▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇ (AS
DEFINED ON EXHIBIT "A").
1.5. Lease Term: Three (3) years ("TERM"), commencing
August 1, 2000 ("COMMENCEMENT DATE") and ending July 31, 2003 ("EXPIRATION
DATE").
1.6. Permitted Uses: (See SECTION 4) research and
development of pharmaceuticals (excluding manufacturing) and ancillary offices
1.7. Tenant's Guarantor: (if none, so state) None
1.8. Brokers: (See SECTION 23; if none, so state)
(A) Tenant's Broker: None
(B) Landlord's Broker: ▇▇▇▇▇ ▇▇▇▇ & Co.
1.9. Security Letter of Credit. (SEE RIDER SECTION 2).
Security Letter of Credit in initial amount of $ $160,000.00
1.10. Intentionally Omitted.
1.11. Base Rent Payable by Tenant is: SEE EXHIBIT "1.11"
1.12. Riders to Lease: The following riders are attached to
and made a part of this Lease. (If none, so state) See RIDERS and EXHIBITS
attached hereto and made a part hereof
2. LEASE OF PREMISES; RENT.
2.1. LEASE OF PREMISES FOR LEASE TERM. Landlord hereby
leases the Premises to Tenant, and Tenant hereby rents the Premises from
Landlord, for the Term and subject to the conditions of this Lease.
2.2. TYPES OF RENTAL PAYMENTS. Tenant shall pay rents of
(a) net base rent payable in monthly installments as set forth in SECTION 1.11
hereof, in advance, on the first day of each and every calendar month during the
Term of this Lease (the "BASE RENT") provided, however, that Base Rent payment
shall commence on Commencement Date, as adjusted pursuant to Section 5.2 and
shall be payable as set forth on EXHIBIT "1.11"; and (b) all costs, expenses and
charges of every nature relating to, or incurred in connection with, the
ownership, repair, replacement, restoration, maintenance and operation of the
Premises and that are incurred, attributable to, or become due, during the Term,
including, but not limited to, the cost of the Landlord's Policies (as defined
in SECTION 10.1 ) [collectively, "ADDITIONAL RENT"]; and (c) in the event any
monthly installment of Base Rent or Additional Rent, or both, is not paid within
10 days of the date when due, a late charge in an amount equal to 5% of the then
delinquent installment of Base Rent and/or Additional Rent (the "LATE CHARGE";
the Late Charge, Base Rent, Additional Rent and all other amounts payable by
Tenant under this Lease shall collectively be referred to as "RENT"), to First
Industrial Pennsylvania, L.P., c/o First Industrial, L.P., ▇.▇. ▇▇▇ ▇▇▇▇▇,
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇, or if sent by overnight courier, First Chicago National
Processing Center, 3rd Floor, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇,
Attention: First Industrial Pennsylvania, L.P., Lockbox #33098 (or such other
entity designated as Landlord's management agent, if any, and if Landlord so
appoints such a management agent, the "Agent"), or pursuant to such other
directions as Landlord shall designate in this Lease or otherwise in writing.
2.3. COVENANTS CONCERNING RENTAL PAYMENTS. Tenant shall
pay the Rent promptly when due, without notice or demand, and without any
abatement, deduction or setoff, except as may otherwise be expressly and
specifically provided in this Lease. No payment by Tenant, or receipt or
acceptance by Agent or Landlord, of a lesser amount than the correct Rent shall
be deemed to be other than a payment on account, nor shall any endorsement or
statement on any check or letter accompanying any payment be deemed an accord or
satisfaction, and Agent or Landlord may accept such payment without prejudice to
its right to recover the balance due or to pursue any other remedy available to
Landlord. If the Commencement Date occurs on a day other than the first day of a
calendar month, the Rent due for the first calendar month of the
Term shall be prorated on a per diem basis and paid to Landlord on the
Commencement Date, and the Term will be extended to terminate on the last day of
the calendar month in which the Expiration Date stated in SECTION 1.5 occurs.
3. OPERATING EXPENSES; TAXES AND ASSESSMENTS
3.1. OPERATING EXPENSES. Landlord, subject to Tenant's
timely payment of the Operating Expenses (hereinafter defined) as Additional
Rent in accordance with this Section 3.1 and Section 3.3, shall administer,
maintain, and perform, the following items throughout the Term: (a) landscaping
and lawn mowing at the Premises, (b) all snow and ice removal from parking
areas, loading areas and roadways on the Premises, (c) all exterior
non-structural, repairs and replacements, ordinary and extraordinary, to the
Building constituting a part of the Premises, including, but not limited to, the
exterior of the Building constituting a part of the Premises, sidewalks,
driveways, curbs, parking areas and loading areas, and (d) any service or
maintenance contracts covering systems, except for the HVAC maintenance contract
which Tenant will be contracting for directly, serving the Premises. Landlord
shall receive an annual management fee of Three Percent (3%) of annual Base
Rent. The expenses described above in this Section 3.1 are defined in this
Lease, collectively, as "Operating Expenses." The cost of capital improvements
that are included as Operating Expenses (all according to generally accepted
accounting principles and excluding capital leases) shall be amortized over the
estimated life of such improvements and the yearly amortized amount shall be
included in Operating Expenses for such Operating Year. Notwithstanding the
foregoing, Landlord, at its sole cost and expense and not as an Operating
Expense, shall be solely responsible for performing the maintenance, repair and
replacement of the roof and all structural elements of the Building constituting
part of the Premises and the replacement of the HVAC system (excluding the
Liebert Unit) serving the Premises (except for such repair and replacement
resulting from "Tenant Necessitated Repairs" (as defined at Section 13.1)).
Landlord shall not be responsible for, and Tenant be responsible for and shall
pay, the entire cost of, any maintenance, repair, or replacement of any portion
of the Premises or any system serving the Premises necessitated by Tenant
Necessitated Repairs. Landlord shall not be responsible for, and Tenant shall be
responsible for and shall pay, the entire cost of, any maintenance, repair, or
replacement of the interior of the Building constituting a part of the Premises
(except, to the extent expressly provided in this Lease, for structural repairs
and replacements, and the replacement of the HVAC system), including, without
limitation of any costs relating to any security systems, janitorial services,
and waste removal services. Landlord and Tenant agree that the following items
shall be excluded from "Operating Expenses:" any depreciation allowance or
expense, amortization and other non-cash items; any costs or expenses
representing any amount paid for services and materials to a (personal or
business) related person, firm or entity to the extent such amount exceeds the
amount that would have been paid for such service or materials at the
then-existing market rates in the absence of such relationship; the costs of
repair, replacement or restoration work occasioned by any casualty or
condemnation; the costs of additional casualty insurance premiums for the
Premises materially in excess of the standard rate payable by Landlord for
comparable facilities in the area, unless attributable to Tenant's use of the
Premises; the costs of repairs, alterations and general maintenance to the
extent necessitated by the negligence or willful misconduct of Landlord or its
agents, employees or contractors, or the cost or repairs, alterations and
general maintenance to the extent necessitated by the negligence or willful
misconduct of any other tenant or such other tenant's invitees; any amount
payable by Landlord (a) by way of indemnity, (b) for damages or (c) which
constitute a fine or penalty, including interest or penalties for late payment;
and any capital costs incurred in compliance with existing or new or revised
federal or state laws or municipal ordinances, or codes or regulations
promulgated under any of the same, requiring modifications to any portion of the
Premises unless attributable to Tenant's use of the Premises.
3.2. TAXES AND ASSESSMENTS. Tenant agrees to pay as
Additional Rent for the Premises (i) all governmental taxes, assessments, fees
and charges of every kind or nature, whether general, special, ordinary or
extraordinary, due at any time or from time to time, during the Term and any
extensions thereof, in connection with the ownership, leasing, or operation of
the Premises, or of the personal property and equipment located therein or used
in connection therewith; and (ii) any reasonable expenses incurred by Landlord
in contesting such taxes or assessments and/or the assessed value of the
Premises (the "Taxes"). All such taxes shall be paid by Tenant as part of the
monthly installments of Additional Rent. The Taxes for the first and last years
of the Term will be appropriately prorated. If any special assessments levied
against the Property are payable in installments, Tenant shall be responsible
only for those installments that are due and payable during the Term. For
purposes hereof, Taxes for any year shall be Taxes that are due for payment or
paid in that year rather than Taxes that are assessed, become a lien or accrue
during such year. Taxes shall not include (i) any inheritance, estate,
succession, transfer, gift, franchise, corporation, income or profit tax or
capital levy that is or may be imposed upon Landlord or (ii) any taxes resulting
from a transfer of the Premises.
3.3. PAYMENT OF OPERATING EXPENSES, TAXES AND PREMIUMS FOR
LANDLORD'S POLICIES. Landlord shall have the right to reasonably estimate the
Operating Expenses, Taxes and premiums for Landlord's Policies for each
"Operating Year" (as hereinafter defined). Upon Landlord's or Agent's notice to
Tenant of such estimated amount, Tenant shall pay, on the first day of each
month during that Operating Year, an amount (the "ESTIMATED RECURRING ADDITIONAL
RENT") equal to the estimate of the Operating Expenses, Taxes and premiums for
Landlord's Policies, for such Operating Year divided by twelve (12) (or the
fractional portion of the Operating Year remaining at the time Landlord delivers
its notice of Estimated Recurring Additional Rent due from Tenant for that
Operating Year). If the aggregate amount of Estimated Recurring Additional Rent
actually paid by Tenant during any Operating Year is less than Tenant's actual
ultimate liability for the same for that particular Operating Year, Tenant shall
pay the deficiency within thirty (30) days of Landlord's demand therefor. If the
aggregate amount of Estimated Recurring Additional Rent actually paid by Tenant
during a given Operating Year exceeds Tenant's actual liability for such
Operating Year, the excess shall be credited against the Estimated Recurring
Additional Rent next due from Tenant during the
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immediately subsequent Operating Year, except that in the event that such excess
is paid by Tenant during the final Lease Year, then upon the expiration of the
Term, Landlord or Agent shall pay Tenant the then- applicable excess promptly
after determination thereof. No interest shall be payable to Tenant on account
of such payments of Estimated Recurring Additional Rent and such payments may be
commingled. As used in this Section 3, the term "OPERATING YEAR" means each
calendar year commencing January 1st and ending December 31st (including the
calendar year within which the Commencement Date occurs) during the Term.
3.4. REVIEW OF OPERATING EXPENSES. As soon as practical
following the end of each Operating Year (including the year in which the term
of this Lease ends), Landlord shall deliver to Tenant a statement indicating the
actual amount of Operating Expenses and Taxes (including a copy of the tax ▇▇▇▇)
for such ended Operating Year. Tenant, at its sole cost and expense, shall have
the right to be exercised no later than forty-five (45) days following the
furnishing of the aforesaid statement to Tenant, upon ten (10) days' prior
written notice to Landlord, to examine at a location determined by Landlord, the
Landlord's backup support and data relating to the Operating Expenses and Taxes
for the preceding Operating Year. If in such inspection Tenant identifies any
overpayments or unsupported costs which exceed the total amount of the true
Operating Expenses, Landlord shall repay Tenant for such cost within ten (10)
days of such determination. In addition, to the extent such identified
overpayments or unsupported costs exceed ten percent (10%) of the total amount
of the true Operating Expenses, Landlord shall reimburse Tenant for its
reasonable third-party costs associated with such examination and audit.
4. USE OF PREMISES; SIGNAGE
4.1. USE OF PREMISES. The Premises shall be used by Tenant
for the purpose(s) set forth in SECTION 1.6 above and for no other purpose
whatsoever. Tenant shall not, at any time, use or occupy, or suffer or permit
anyone to use or occupy, the Premises, or do or permit anything to be done in
the Premises, in any manner that may (a) violate any Certificate of Occupancy
for the Premises; (b) cause, or be liable to cause, injury to, or in any way
impair the proper utilization of, all or any portion of the Premises (including,
but not limited to, the structural elements of the Building, as defined in
EXHIBIT "A") or any equipment, facilities or systems therein; (c) constitute a
violation of the laws and requirements of any public authority or the
requirements of insurance bodies or the rules and regulations of the Premises,
including any covenant, condition or restriction affecting the Premises; (d)
exceed the load bearing capacity of the floor of the Building: (e) impair or
tend to impair the character, reputation or appearance of the Premises; or (f)
unreasonably annoy, inconvenience or disrupt the operations or tenancies of
other tenants or users of the Premises, if any.
4.2. SIGNAGE. Tenant shall not affix any sign of any size
or character to any portion of the Premises, without prior written approval of
Landlord, which approval shall not be unreasonably withheld or delayed. Tenant
shall remove all signs of Tenant upon the expiration or earlier termination of
this Lease and immediately repair any damage to the Premises caused by, or
resulting from, such removal.
4.3. INTENTIONALLY OMITTED
5. CONDITION AND DELIVERY OF PREMISES.
5.1. CONDITION OF PREMISES. Tenant agrees that Tenant is
familiar with the condition of the Premises, and Tenant hereby accepts the
foregoing on an "AS-IS," "WHERE-IS" basis, subject to the obligation of Landlord
to complete the Work Items (hereinafter defined). Tenant acknowledges that
neither Landlord nor Agent nor any representative of Landlord has made any
representation as to the condition of the foregoing or the suitability of the
foregoing for Tenant's intended use. Tenant represents and warrants that Tenant
has made its own inspection of the foregoing. Neither Landlord nor Agent shall
be obligated to make any repairs, replacements or improvements (whether
structural or otherwise) of any kind or nature to the foregoing in connection
with, or in consideration of, this Lease, except (a) as set forth in SECTION
3.1, SECTION 13.2, AND SECTION 18 and (b) with respect to all (if any) repairs
and improvements expressly and specifically described in EXHIBIT "B" attached
hereto ("WORK ITEMS"). Landlord shall complete the Work Items in a good and
workmanlike manner. The Premises shall be deemed ready for occupancy by Tenant
when (a) the Township of Uwchlan, Pennsylvania has issued a certificate of
occupancy for the Premises, and (b) the Work Items have been completed except
for such items of finishing and construction of such nature which are not
necessary to make the Premises reasonably tenantable for Tenant's use; Landlord
shall complete any incomplete items within thirty (30) days after the
Commencement Date Landlord agrees to make reasonable efforts to enforce, or
cause Agent to enforce, upon Tenant's request, all manufacturer's or
contractor's warranties, if any, issued in connection with any of the Work
Items. If the cost of the Work Items exceeds Fifty-Six Thousand Dollars
($56,000.00), Landlord shall, prior to incurring such additional expense,
contact Tenant and request Tenant's consent to such additional expense. If
Tenant does not respond within 24 hours of Landlord's request, such request for
additional cost shall be deemed approved. If Tenant agrees to the additional
expense, Tenant shall pay such excess to Landlord within fifteen (15) days after
the presentation by Landlord to Tenant of invoices therefor.
5.2. DELAY IN COMMENCEMENT. Landlord shall not be liable
to Tenant if Landlord does not deliver possession of the Premises to Tenant on
the Commencement Date. The obligations of Tenant under the Lease shall not be
affected thereby, except that the Commencement Date shall be delayed until
Landlord delivers possession of the Premises to Tenant, and the Lease Term shall
be extended by a period equal to the number of days of delay in delivery of
possession of the Premises to Tenant, plus the number of days necessary to end
the Lease Term on the last day of a month. If Landlord cannot deliver sole
possession of
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the Premises by September 15, 2000, Tenant shall have the ability to terminate
this Lease upon written notice to Landlord.
6. SUBORDINATION; NOTICES TO SUPERIOR LESSORS AND MORTGAGEES;
ATTORNMENT.
6.1. SUBORDINATION. Provided that Tenant is provided with
a reasonable and customary subordination, nondisturbance and attornment
agreement duly executed by the holder of any mortgage or deed of trust or the
landlord pursuant to any ground lease, this Lease is and shall be subject and
subordinate at all times to all ground leases or underlying leases that may now
exist or hereafter be executed affecting the Premises; and to any mortgage or
deed of trust that may now exist or be placed upon, and encumber, any or all of
the Premises; any ground leases or underlying leases for the benefit of the
Premises; or all or any portion of Landlord's interest or estate in any of said
items. Notwithstanding the foregoing, Landlord shall have the right to
subordinate (or cause to be subordinated) any such ground leases or underlying
leases for the benefit of the Premises, or any such mortgage or deed of trust
liens, to this Lease. Tenant shall execute and deliver, upon demand by Landlord
and in the form reasonably requested by Landlord, any additional documents
evidencing the priority of subordination of this Lease with respect to any such
ground leases or underlying leases or any such mortgage or deed of trust.
Landlord represents and warrants to Tenant that, as of the date of this Lease,
there are no mortgages or ground leases encumbering the Premises.
6.2. ESTOPPEL CERTIFICATES. Landlord and Tenant each
agree, from time to time and within fifteen (15) days after request by the other
party, to deliver to the requesting party, an estoppel certificate stating such
factual matters pertaining to this Lease as may be reasonably requested.
Landlord and Tenant intend that any statement delivered pursuant to this section
may be relied upon by the requesting party and its designees.
6.3. TRANSFER FOR LANDLORD. In the event of a sale or
conveyance by Landlord of the Premises, and provided that the successor Landlord
assumes the Lease in writing, the same shall operate to release Landlord from
any future liability for any of the covenants or conditions, express or implied,
herein contained in favor of Tenant, and in such event Tenant agrees to look
solely to Landlord's successor in interest with respect thereto and agrees to
attorn to such successor.
7. QUIET ENJOYMENT. Subject to the provisions of this Lease, so long as
Tenant is not in default under this Lease, Tenant shall not be disturbed in its
possession of the Premises by Landlord, Agent or any other person lawfully
claiming through or under Landlord. This covenant shall be construed as a
covenant running with the Premises and is not a personal covenant of Landlord.
Notwithstanding the foregoing, however, Tenant acknowledges and agrees that
Landlord shall have the unfettered and unilateral right to use portions of the
Premises (but not the interior of the Building) for such purposes and uses as
Landlord may desire; provided, however, that in all events and under all
circumstances, Landlord's use of any portion of the Premises shall not
interfere, in any material respect, with any or all of (a) Tenant's rights to
occupy and use the Premises (in the manner and for the purposes contemplated
hereunder); (b) Tenant's right to utilize the vehicular parking areas located on
the Premises; and (c) Tenant's right of access, ingress and egress to and from
the Premises.
8. ASSIGNMENT, SUBLETTING AND MORTGAGING.
8.1. PROHIBITION. Tenant acknowledges that this Lease and
the Rent due under this Lease have been agreed to by Landlord in reliance upon
Tenant's reputation and creditworthiness and upon the continued operation of the
Premises by Tenant for the particular use set forth in SECTION 4 above;
therefore, Tenant shall not, whether voluntarily, or by operation of law, or
otherwise: (a) assign or otherwise transfer this Lease; (b) sublet the Premises
or any part thereof, or allow the same to be used or occupied by anyone other
than Tenant; or (c) mortgage, pledge, encumber, or otherwise hypothecate this
Lease or the Premises, or any part thereof, in any manner whatsoever, without in
each instance obtaining the prior written consent of Landlord, which consent may
be given or withheld in Landlord's sole, but reasonable, discretion. Any
purported assignment, mortgage, transfer, pledge or sublease made without the
prior written consent of Landlord shall be absolutely null and void. No
assignment of this Lease shall be effective and valid unless and until the
assignee executes and delivers to Landlord any and all documentation reasonably
required by Landlord in order to evidence assignee's assumption of all
obligations of Tenant hereunder. Any consent by Landlord to a particular
assignment, sublease or mortgage shall not constitute consent or approval of any
subsequent assignment, sublease or mortgage, and Landlord's written approval
shall be required in all such instances. No consent by Landlord to any
assignment or sublease shall be deemed to release Tenant from its obligations
hereunder and Tenant shall remain fully liable for performance of all
obligations under this Lease.
8.2. RIGHTS OF LANDLORD. If this Lease is assigned, or if
the Premises (or any part thereof) are sublet or used or occupied by anyone
other than Tenant, whether or not in violation of this Lease, Landlord or Agent
may (without prejudice to, or waiver of its rights), collect Rent from the
assignee, subtenant or occupant. Landlord or Agent may apply the net amount
collected to the Rent herein reserved, but no such assignment, subletting,
occupancy or collection shall be deemed a waiver of any of the provisions of
this SECTION 8. With respect to the allocable portion of the Premises sublet, in
the event that the total rent and any other considerations received under any
sublease by Tenant is greater than the total Rent required to be paid, from time
to time, under this Lease, Tenant shall pay to Landlord fifty percent (50%) of
such excess as received from any subtenant and such amount shall be deemed a
component of the Additional Rent.
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8.3. PERMITTED TRANSFERS. The provisions of SECTION 8.1(a)
shall apply to a transfer of a majority of the voting stock of Tenant or to any
other change in voting control of Tenant (if Tenant is a corporation), or to a
transfer of a majority (I.E. greater than 50% interest) of the general
partnership or membership interests in Tenant (if Tenant is a partnership or a
limited liability company) or managerial control of Tenant, or to any comparable
transaction involving any other form of business entity, whether effectuated in
one or more transactions, as if such transfer were an assignment of this Lease;
but said provisions shall not apply to such a transfer, provided, in any of such
events, the successor to Tenant (or any party remaining liable for the
obligations of Tenant hereunder) (i) has a net worth at least equal to the net
worth of Tenant as of the Commencement Date or (ii) otherwise is capable of
satisfying Tenant's obligations hereunder, in Landlord's reasonable judgment.
Any such permitted transferee shall execute and deliver to Landlord any and all
documentation reasonably required by Landlord in order to evidence assignee's
assumption of all obligations of Tenant hereunder.
9. COMPLIANCE WITH LAWS.
9.1. COMPLIANCE WITH LAWS. From and after the Commencement
Date, Tenant shall, at its sole expense (regardless of the cost thereof), comply
with all local, state and federal laws, rules, regulations and requirements now
or hereafter in force and all judicial and administrative decisions in
connection with the enforcement thereof (collectively, "LAWS"), pertaining
Tenant's use of the Premises. If any license or permit is required for the
conduct of Tenant's business in the Premises, Tenant, at its expense, shall
procure such license prior to the Commencement Date, and shall maintain such
license or permit in good standing throughout the Term. Tenant shall give prompt
notice to Landlord of any written notice it receives of the alleged violation of
any Laws or requirements of any governmental or administrative authority with
respect to either or both of the Premises and the use or occupation thereof. The
judgment of any court of competent jurisdiction, or the admission of Tenant in
any action or proceeding against Tenant, whether Landlord is a party thereto or
not, that any such Law pertaining to the Premises has been violated, shall be
conclusive of that fact as between Landlord and Tenant. Landlord represents and
warrants to Tenant that, as of the date of this Lease, there are no outstanding
notices received by Landlord of violations of Laws pertaining to the Premises,
including, without limitation, Laws pertaining to Hazardous Materials or the
Americans with Disabilities Act. Landlord represents and warrants to its actual
knowledge, without investigation, that the Premises, during its period of
ownership, has not been subject to a prior Nuclear Regulatory Commission ("NRC")
license or permit and that the Premises, as of the Commencement Date, is
available for unrestricted use as such term relates to the decommissioning of
the premises at the expiration of a NRC permit or license, based solely on the
fact that during Landlord's ownership, the Premises was not subject to a NRC
license or permit. Landlord shall, at its cost and expense, cause the
construction of the Work Items at the Premises to comply with Laws in force and
pertaining to the Premises as of Commencement Date.
9.2. Hazardous Materials. If during the Term (or any
extension thereof) any Hazardous Material (defined below) is generated,
transported, stored, used, treated or disposed of at, to, from, on or in the
Premises by, or as a result of any act or omission of, any or all of Tenant and
any or all of Tenant's Parties (defined below): (i) Tenant shall, at its own
cost, at all times comply (and cause all others to comply) with all laws
(federal, state or local) relating to Hazardous Materials, including, but not
limited to, all Environmental Laws (defined below), and Tenant shall further, at
its own cost, obtain and maintain in full force and effect at all times all
permits and other approvals required in connection therewith; (ii) Tenant shall
promptly provide Landlord or Agent with complete copies of all communications,
permits or agreements with, from or issued by any governmental authority or
agency (federal, state or local) or any private entity relating in any way to
the presence, release, threat of release, or placement of Hazardous Materials on
or in the Premises, or the generation, transportation, storage, use, treatment,
or disposal at, on, in or from the Premises, of any Hazardous Materials; and
(iii) Landlord, Agent and their respective agents and employees shall have the
right, upon prior written notice and during normal business hours, to either or
both (a) enter the Premises and (b) conduct appropriate tests for the purposes
of ascertaining Tenant's compliance with all applicable Laws (including
Environmental Laws), rules or permits relating in any way to the generation,
transport, storage, use, treatment, disposal or presence of Hazardous Materials
on, at, in or from the Premises or any portion thereof. This SECTION 9.2 does
not authorize the generation, transportation, storage, use, treatment or
disposal of any Hazardous Materials at, to, from, on or in the Premises in
contravention of this SECTION 9. Tenant covenants to investigate, clean up and
otherwise remediate, in accordance with applicable Environmental Laws, at
Tenant's sole expense, any release of Hazardous Materials caused or created by
any or all of (A) Tenant and (B) any or all of Tenant's officers, directors,
invitees, agents, employees, contractors or representatives ("TENANT'S PARTIES")
during the Term. Remediation activity having an estimated value in excess of
$10,000 shall be performed only after Tenant has obtained Landlord's prior
written consent; provided, however, that Tenant shall be entitled to respond
immediately to an emergency without first obtaining such consent. Tenant shall
be liable for any and all conditions covered hereby, and for all costs relating
thereto, that are caused or created by any or all of Tenant and Tenant's
Parties. Tenant shall not enter into any settlement agreement, consent decree or
other compromise with respect to any claims relating to any Hazardous Materials
in any way connected to the Premises without first obtaining Landlord's written
consent which consent shall not be unreasonably withheld solely as to a
settlement agreement or settlement agreements between Tenant and state or
federal authorities or both, after Tenant has completed a clean-up or
remediation of Hazardous Materials in accordance with applicable Environmental
Laws under this SECTION 9.2, and affording Landlord the reasonable opportunity
to participate in any such proceedings. As used herein, the term (x)
"ENVIRONMENTAL LAWS" shall mean any and all Laws pertaining to Hazardous
Materials or that otherwise deal with or relate to air or water quality, air
emissions, soil or ground conditions or other environmental matters of any kind;
and (y) "HAZARDOUS MATERIALS" shall mean any waste, material or substance
(whether in the form of liquids, solids or gases, and whether or not air-borne)
that is or may be deemed to be or include a pesticide, petroleum, asbestos,
polychlorinated biphenyl, radioactive material, urea formaldehyde or any other
pollutant or
5
contaminant that is or may be deemed to be hazardous, toxic, ignitable,
reactive, corrosive, dangerous, harmful or injurious, or that presents a risk to
public health or to the environment, and that is or becomes regulated by any
Environmental Law. At least ten (10) days before the termination or earlier
expiration of the Lease, Tenant, at Tenant's sole expense, shall deliver to
Landlord an "Environmental Assessment" (as defined below) of the interior areas
of the Premises prepared by an independent environmental consultant reasonably
acceptable to Landlord indicating that Tenant has complied with this Section 9.2
and has satisfied the terms and conditions contained in the Nuclear Regulatory
Commission ("NRC") Materials License ("License") issued to Tenant with respect
to: (i) the use, storage and handling of such materials in a specified and
limited area of the premises, and (ii) the decommissioning of that portion of
the Premises for "unrestricted use," based solely upon such terms applicability
under the terms and conditions of the License. Tenant shall also deliver a
certificate stating to its knowledge, that no event has occurred that caused the
release of Hazardous Materials on the exterior of the Premises. For purposes of
this Section 9.2, the term "Environmental Assessment" shall be limited to (a)
samples taken from the interior of the Premises in order to identify whether any
of the substances or materials that are customarily used in connection with
Tenant's permitted use of the Premises for pharmaceutical research and
development exceed amounts that are permitted under Environmental Law and (b)
such action that may be necessary to satisfy the requirements of the License for
decommissioning that portion of the Premises for unrestricted use based solely
upon the terms and conditions of the License as such are applied by the NRC.
Tenant shall not be responsible for the remediation or clean-up of any Hazardous
Materials, chemicals or biological compounds that are identified all of the
final reports prepared by for US Bioscience and Med Immune in connection with
its analysis of the Premises. Landlord agrees to deliver such reports to Tenant
within five (5) days of its receipt. Landlord agrees that Tenant may rely upon
such report in establishing the base-line for the Premises as of the
Commencement Date.
10. INSURANCE.
10.1. INSURANCE TO BE MAINTAINED BY LANDLORD. Landlord
shall maintain (a) "all-risk" property insurance covering the Premises (at its
full replacement cost), but excluding Tenant's Property (defined in SECTION 12.2
below), and (b) commercial general public liability insurance covering Landlord
for claims arising out of liability for bodily injury, death, personal injury,
advertising injury and property damage occurring in and about the Premises and
otherwise resulting from any acts and operations of Landlord, its agents and
employees, and (c) rent loss insurance (collectively, "LANDLORD'S POLICIES"),
all of the above with limits that are required by any lender(s) of Landlord, or
as are otherwise reasonably determined by Landlord.
10.2. LIABILITY INSURANCE. Tenant shall purchase, at its
own expense, and keep in force during this Lease a policy or policies of (i)
commercial general liability insurance, including personal injury and property
damage, in the amount of not less than $2,000,000.00 per occurrence and
$5,000,000.00 annual general aggregate per location, and comprehensive
automobile liability insurance covering Tenant against any losses arising out of
liability for personal injuries or deaths of persons and property damage
occurring in or about the Premises and (ii) "all-risk" property insurance
covering Tenant's Property (and damage to other property resulting from any acts
or operations of Tenant). Said policies shall (a) name Landlord, Agent, and any
party holding an interest to which this Lease may be subordinated as additional
insureds, (b) be issued by an insurance company with a Best rating of A-X or
better and otherwise reasonably acceptable to Landlord and licensed to do
business in the state in which the Premises is located, (c) provide that said
insurance shall not be canceled or materially modified unless 30 days' prior
written notice shall have been given to Landlord, (d) provide coverage on an
occurrence basis; (e) provide coverage for the indemnity obligations of Tenant
under this Lease; (f) contain a severability of insured parties provision and a
cross liability endorsement; (g) be primary, not contributing with, and not in
excess of, coverage that Landlord may carry; (h) include a hostile fire
endorsement; and (i) otherwise be in such form and include such coverages as
Landlord may reasonably require. Said policy or policies or, at Landlord's
option, Certificate of Insurance, in a form reasonably acceptable to Landlord,
evidencing said policies, shall be delivered to Landlord by Tenant upon
commencement of the Lease and renewals thereof shall be delivered at least 30
days prior to the expiration of said insurance.
10.3. WAIVER OF SUBROGATION. To the extent permitted by
law, and without affecting the coverage provided by insurance required to be
maintained hereunder, Landlord and Tenant each waive any right to recover
against the other for (a) damages to property, (b) damages to the Premises or
any part thereof or (c) claims arising by reason of the foregoing, to the extent
such damages and claims are insured against or required to be insured against by
Landlord or Tenant under this Lease. This provision is intended to waive, fully
and for the benefit of each party, any rights and/or claims that might give rise
to a right of subrogation by any insurance carrier. The coverage obtained by
each party pursuant to this Lease shall include, without limitation, a waiver of
subrogation by the carrier which conforms to the provisions of this section.
11. ALTERATIONS.
11.1. PROCEDURAL REQUIREMENTS. Tenant may, from time to
time, at its expense, make alterations or improvements in and to the Premises
(hereinafter collectively referred to as "ALTERATIONS"), provided that Tenant
first obtains the written consent of Landlord in each instance. Landlord's
consent to Alterations shall not be unreasonably withheld, provided that: (a)
the Alterations are non-structural and the structural integrity of the Building
shall not be affected; (b) the Alterations are to the interior of the Building;
(c) the proper functioning of the mechanical, electrical, heating, ventilating,
air-conditioning ("HVAC"), sanitary and other service systems of the Premises
shall not be affected and the usage of such systems by Tenant shall not be
increased; (d) Tenant shall have appropriate insurance coverage, reasonably
satisfactory to
6
Landlord, regarding the performance and installation of the Alterations; (e) the
Alterations shall conform with all other requirements of this Lease; and (f)
Tenant shall have provided Landlord with reasonably detailed plans (the "PLANS")
for such Alterations in advance of requesting Landlord's consent.
Notwithstanding anything to the contrary contained in this SECTION 11.1,
Landlord's consent shall not be required for Alterations satisfying clauses (a)
through (e) above and costing $10,000.00 or less in any one instance (up to a
maximum aggregate of $25,000.00 over the Term). Additionally, before proceeding
with any Alterations, Tenant shall (i) at Tenant's expense, obtain all necessary
governmental permits and certificates for the commencement and prosecution of
Alterations; (ii) submit to Agent, for Landlord's written approval, working
drawings, plans and specifications and all permits for the work to be done and
Tenant shall not proceed with such Alterations until it has received said
approval; and (iii) cause those contractors, materialmen and suppliers engaged
to perform the Alterations to deliver to Landlord certificates of insurance (in
a form reasonably acceptable to Landlord) evidencing policies of commercial
general liability insurance (providing the same coverages as required in SECTION
10.2(i)) and workers compensation insurance. Such insurance policies shall
satisfy the obligations imposed under SECTION 10.2(a) through (d) and SECTION
10.2(f) through (i). After obtaining Landlord's approval to the Alterations,
Tenant shall give Landlord at least five days' prior written notice of the
commencement of any Alterations at the Premises, and Landlord may elect to
record and post notices of non-responsibility at the Premises.
11.2. PERFORMANCE OF ALTERATIONS. Tenant shall cause the
Alterations to be performed in compliance with all applicable permits, laws and
requirements of public authorities, and with Landlord's reasonable rules and
regulations or any other restrictions that Landlord or Agent may impose on the
Alterations. Tenant shall cause the Alterations to be diligently performed in a
good and workmanlike manner, using new materials and equipment at least equal in
quality and class to the standards for the Premises established by Landlord or
Agent. Tenant shall obtain all necessary permits and certificates for final
governmental approval of the Alterations and shall provide Landlord with "as
built" plans, copies of all construction contracts, governmental permits and
certificates and proof of payment for all labor and materials, including,
without limitation, copies of paid invoices and final lien waivers.
11.3. LIEN PROHIBITION. Tenant shall pay when due all
claims for labor and material furnished to the Premises in connection with the
Alterations. Tenant shall not permit any mechanics or materialmen's liens to
attach to the Premises. Tenant, at its expense, shall procure the satisfaction
or discharge of record of all such liens and encumbrances within 30 days after
the filing thereof; or, if acceptable to Landlord, in its reasonable
determination, Tenant may procure (for Landlord's benefit) a bond or other
protection against any such lien or encumbrance. In the event Tenant has not so
performed, Landlord may, at its option, pay and discharge such liens and Tenant
shall be responsible to reimburse Landlord, on demand and as Additional Rent
under this Lease, for all costs and expenses incurred in connection therewith,
together with interest thereon at the rate set forth in SECTION 22.3, which
expenses shall include reasonable fees of attorneys of Landlord's choosing, and
any costs in posting bond to effect discharge or release of the lien as an
encumbrance against the Premises.
12. LANDLORD'S AND TENANT'S PROPERTY.
12.1. LANDLORD'S PROPERTY. Subject to SECTION 12.2, all
fixtures, machinery, equipment, improvements and appurtenances attached to, or
built into, the Premises at the commencement of, or during the Term, whether or
not placed there by or at the expense of Tenant, shall become and remain a part
of the Premises; shall be deemed the property of Landlord (the "LANDLORD'S
PROPERTY"),without compensation or credit to Tenant; and shall not be removed by
Tenant at the Expiration Date unless Landlord notifies Tenant within ten (10)
days after their installation that Landlord is requiring their removal at or
before the Expiration Date or sooner termination of the Term. Further, any
personal property in the Premises on the Commencement Date, movable or
otherwise, unless installed and paid for by Tenant, shall be and shall remain
the property of Landlord and shall not be removed by Tenant. In no event shall
Tenant remove any of the following materials or equipment without Landlord's
prior written consent: any power wiring or power panels, lighting or lighting
fixtures, wall or window coverings, carpets or other floor coverings, heaters,
air conditioners or any other HVAC equipment, fencing or security gates, or
other similar building operating equipment and decorations.
12.2. TENANT'S PROPERTY. All movable non-structural
partitions, business and trade fixtures, machinery and equipment, communications
equipment and office equipment that are installed in the Premises by, or for the
account of, Tenant and without expense to Landlord, and that can be removed
without structural damage to the Building, and all furniture, furnishings and
other articles of movable personal property owned by Tenant and located in the
Premises (collectively, the "TENANT'S PROPERTY") shall be and shall remain the
property of Tenant and may be removed by Tenant at any time during the Term,
provided Tenant repairs or pays the cost of repairing any damage to the Premises
resulting from the installation and/or removal thereof. At or before the
Expiration Date, or the date of any earlier termination, Tenant, at its expense,
shall remove from the Premises all of Tenant's Property (except such items
thereof as constitute Landlord's Property; or as Landlord shall have expressly
permitted, in writing, to remain, which property shall become the property of
Landlord), and Tenant shall repair any damage to the Premises resulting from any
installation and/or removal of Tenant's Property. At or before the Expiration
Date, or the date of any earlier termination, Tenant shall remove any
Alterations which Landlord required, at the time of granting of Landlord's
consent under this Lease, to be removed, or if such consent was not required
under this Lease, which Landlord did not expressly in writing permit to remain
within thirty (30) days after a written request by Tenant to Landlord for such
determination. Any other items of Tenant's Property that shall remain in the
Premises after the Expiration Date, or following an earlier termination date,
may, at the option of Landlord, be deemed to have been abandoned, and in such
case, such items may be retained by Landlord as its property or be
7
disposed of by Landlord, in Landlord's sole and absolute discretion and without
accountability, at Tenant's expense. Notwithstanding the foregoing, if Tenant is
in default under the terms of this Lease, it may remove Tenant's Property from
the Premises only upon the express written direction of Landlord.
12.3. LANDLORD'S CONSENT AND WAIVER. At Tenant's written
request, Landlord shall execute any landlord's waiver required by Tenant's
lender(s) waiving any landlord's lien that Landlord may have on Tenant's
Property, provided that Tenant is not in default under this Lease, that Tenant
has not been in default under this Lease more than two (2) times in the twelve
(12) months preceding the request, that such waiver is in form and content
reasonably acceptable to Landlord, and that such waiver shall not be deemed to
impair or prevent Landlord from enforcing any judgment lien against Tenant or
Tenant's Property.
13. REPAIRS AND MAINTENANCE.
13.1. TENANT REPAIRS AND MAINTENANCE. Tenant shall be
responsible for and shall pay, the entire cost of, any maintenance, repair, or
replacement of the interior of the Building constituting a part of the Premises
(except, to the extent expressly provided in this Lease, for structural repairs
and replacements, and the replacement of the HVAC system), including, without
limitation of any costs relating to any security systems, janitorial services,
and waste removal services. Tenant shall maintain a full and complete HVAC
maintenance contract with Tustin Mechanical Services that is consistent to
accommodate Tenant's use and is comparable to the maintenance contract carried
by U.S. Bioscience. Tenant agrees to provide Landlord with a copy of such
maintenance contract and not to reduce the level of service under the contract
without Landlord's prior consent. Tenant shall also be responsible for and shall
pay the entire cost of, any maintenance, repair, or replacement of any portion
of the Premises or any system serving the Premises necessitated by Tenant's
negligence, Tenant's willful misconduct, Tenant's misuse or abuse, Tenant's
moving into or out of Premises, or Tenant's making of any Alterations
(collectively, "Tenant Necessitated Repairs").
13.2. LANDLORD REPAIRS. Subject to Tenant's timely payment
of Operating Expenses pursuant to Section 3 of this Lease, Landlord shall
administer, maintain, and perform, the following items throughout the Term: (a)
landscaping and lawn mowing at the Premises, (b) all snow and ice removal from
parking areas, loading areas and roadways on the Premises, (c) all exterior
non-structural, repairs and replacements, ordinary and extraordinary, to the
Building constituting a part of the Premises, including, but not limited to, the
exterior of the Building constituting a part of the Premises, sidewalks,
driveways, curbs, parking areas and loading areas. Landlord, at its sole cost
and expense and not as an Operating Expense, shall be solely responsible for
performing (i) the maintenance, repair and replacement of the roof and all
structural elements of the Building constituting part of the Premises and (ii)
the replacement of the HVAC system when required. Landlord shall not be
responsible for, and Tenant be responsible for and shall pay, the entire cost
of, any maintenance, repair, or replacement of any portion of the Premises or
any system serving the Premises necessitated by Tenant Necessitated Repairs.
14. UTILITIES. Tenant shall purchase all utility services from the
utility or municipality providing such service; shall provide for scavenger,
cleaning, janitorial, waste removal, and extermination services; and shall pay
for such services when payments are due. Tenant shall be solely responsible for
the repair and maintenance of any meters necessary in connection with utility
services. Tenant's use of electrical energy in the Premises shall not, at any
time, exceed the capacity of either or both of (i) any of the electrical
conductors and equipment in or otherwise servicing the Premises; and (ii) the
HVAC systems of the Building.
15. INVOLUNTARY CESSATION OF SERVICES. Landlord reserves the right,
without any liability to Tenant and without affecting Tenant's covenants and
obligations hereunder, to stop service of the HVAC, electric, sanitary, elevator
(if any), or other systems serving the Premises, or to stop any other services
required by Landlord under this Lease, whenever and for so long as may be
necessary by reason of (i) accidents, emergencies, strikes, or the making of
repairs or changes which Landlord or Agent in good ▇▇▇▇▇ ▇▇▇▇▇ necessary or (ii)
any other cause beyond Landlord's reasonable control. Further, it is also
understood and agreed that Landlord or Agent shall have no liability or
responsibility for a cessation of services to the Premises that occurs as a
result of causes beyond Landlord's or Agent's reasonable control. No such
interruption of service shall be deemed an eviction or disturbance of Tenant's
use and possession of the Premises or any part thereof, or render Landlord or
Agent liable to Tenant for damages, or relieve Tenant from performance of
Tenant's obligations under this Lease, including, but not limited to, the
obligation to pay Rent; provided, however, that if any interruption of services
persists for a period in excess of five consecutive business days Tenant shall,
as Tenant's sole remedy, be entitled to a proportionate abatement of Rent to the
extent, if any, of any actual loss of use of the Premises by Tenant.
16. LANDLORD'S RIGHTS. Landlord, Agent and their respective agents,
employees and representatives shall have the right to enter and/or pass through
the Premises at any time or times upon at least twenty-four (24) hours' prior
notice (except in the event of emergency): (a) to examine and inspect the
Premises and to show them to actual and prospective lenders, prospective
purchasers or mortgagees of the Premises or providers of capital to Landlord and
its affiliates; and (b) to make such repairs, alterations, additions and
improvements in or to the Premises or its facilities and equipment as Landlord
is required or desires to make. Landlord and Agent shall be allowed to take all
materials into and upon the Premises that may be required in connection with any
repairs, alterations, additions or improvements, without any liability to Tenant
and without any reduction or modification of Tenant's covenants and obligations
hereunder; provided, however, that Landlord shall use reasonable efforts to
avoid interference with Tenant's business operations and Tenant's occupancy and
use of the Premises and shall repair any physical damage caused to the Premises.
During the period of six months prior to the Expiration Date (or at any time, if
Tenant has vacated or
8
abandoned the Premises or is otherwise in default under this Lease), Landlord
and its agents may exhibit the Premises to prospective tenants and erect a "For
Lease" sign thereon.
17. NON-LIABILITY AND INDEMNIFICATION.
17.1. NON-LIABILITY. Except as provided in SECTION 17.2.2,
none of Landlord, Agent, any other managing agent, or their respective
affiliates, owners, partners, directors, officers, agents and employees shall be
liable to Tenant for any loss, injury, or damage, to Tenant or to any other
person, or to its or their property, irrespective of the cause of such injury,
damage or loss. Further, except as provided in SECTION 17.2.2, none of Landlord,
Agent, any other managing agent, or their respective partners, directors,
officers, agents and employees shall be liable (a) for any damage caused by
other persons in, upon or about the Premises, or caused by operations in
construction of any public or quasi-public work; (b) with respect to matters for
which Landlord is liable, for consequential or indirect damages purportedly
arising out of any loss of use of the Premises or any equipment or facilities
therein by Tenant or any person claiming through or under Tenant; (c) any latent
defect in the Premises; (d) injury or damage to person or property caused by
fire, or theft, or resulting from the operation of heating or air conditioning
or lighting apparatus, or from falling plaster, or from steam, gas, electricity,
water, rain, snow, ice, or dampness, that may leak or flow from any part of the
Premises, or from the pipes, appliances or plumbing work of the same.
17.2. INDEMNIFICATION.
17.2.1. TENANT INDEMNIFICATION. Tenant hereby indemnifies,
defends, and holds Landlord, Agent and their respective affiliates, owners,
partners, directors, officers, agents and employees (collectively, "LANDLORD
INDEMNIFIED PARTIES") harmless from and against any and all Losses (defined
below) arising from or in connection with (a) the conduct or management of the
Premises or any business therein, or any work or Alterations done, or any
condition created by any or all of Tenant and Tenant's Parties in or about the
Premises during the Term or during the period of time, if any, prior to the
Commencement Date that Tenant is given access to the Premises; (b) any act,
omission or negligence of any or all of Tenant and Tenant's Parties; (c) any
accident, injury or damage whatsoever (unless caused by Landlord's negligence,
subject however to any applicable doctrine of comparative or contributory
negligence) occurring in, at or upon the Premises caused by any or all of Tenant
and Tenant's Parties; (d) any breach by Tenant of any of its warranties and
representations under this Lease; (e) any actions necessary to protect
Landlord's interest under this Lease in a bankruptcy proceeding or other
proceeding under the Bankruptcy Code; (f) any violation or alleged violation by
any or all of Tenant and Tenant's Parties of any Law including, without
limitation, any Environmental Law; (g) any breach of the provisions of SECTION 9
by any or all of Tenant and Tenant's Parties; (h) claims for work or labor
performed or materials supplies furnished to, or at the request of, any or all
of Tenant and Tenant's Parties; (i) claims arising from any breach or default on
the part of Tenant in the performance of any covenant contained in this Lease;
(j) any Hazardous Materials used, exposed, emitted, released, discharged,
generated, manufactured, sold, transported, handled, stored, treated, reused,
presented, disposed of or recycled in, at, near or under all or any portion of
the Premises as a result of the acts or omissions of any or all of Tenant and
Tenant's Parties; and (k) the violation of any Environmental Law or any permit,
application or consent required in connection with any Environmental Law by any
or all of Tenant and Tenant's Parties with respect to the Premises during the
Term, excluding, however, any violation of Environmental Law directly and solely
resulting from the acts or omissions of any or all of Landlord and Landlord's
employees, agents and contractors (collectively, "TENANT'S INDEMNIFIED
MATTERS"). In case any action or proceeding is brought against any or all of
Landlord and the Landlord Indemnified Parties by reason of any of Tenant's
Indemnified Matters, Tenant, upon notice from any or all of Landlord, Agent or
any Superior Party (defined below), shall resist and defend such action or
proceeding by counsel reasonably satisfactory to, or selected by, Landlord. The
term "LOSSES" shall mean all claims, demands, expenses, actions, judgments,
damages (whether direct or indirect, known or unknown, foreseen or unforeseen)
(actual, but not consequential or speculative), penalties, fines, liabilities,
losses of every kind and nature (including, without limitation, property damage,
diminution in value of Landlord's interest in the Premises, damages for the loss
or restriction on use of any space or amenity within the Premises, damages
arising from any adverse impact on marketing space in the Premises, sums paid in
settlement of claims and any costs and expenses associated with injury, illness
or death to or of any person), suits, administrative proceedings, costs and
fees, including, without limitation, attorneys' and consultants' fees and
expenses, and the costs of cleanup, remediation, removal and restoration, that
are in any way related to any matter covered by the foregoing indemnity. The
provisions of this SECTION 17.2.1 shall survive the expiration or termination of
this Lease.
17.2.2. LANDLORD INDEMNIFICATION. Landlord hereby
indemnifies, defends and holds Tenant, its respective affiliates, owners,
shareholders, directors, officers, agents and employees ("Tenant Indemnified
Parties") harmless from and against any and all Losses (actual, but not
consequential or speculative), (including, but not limited to, court costs and
attorneys' reasonable fees) actually suffered or incurred by Tenant Indemnified
Parties as the result of (a) any negligent, willful or intentional acts or
omissions of any or all of Landlord, Agent and any parties within the control of
either or both of Landlord and Agent, or (b) the use, storage, disposal, release
or discharge of Hazardous Materials in, at or under the Premises or Property by
Landlord in violation of Environmental Laws. In the event that any action or
proceeding is brought against Tenant Indemnified Parties, and the foregoing
indemnity is applicable to such action or proceeding, then Landlord, upon notice
from Tenant Indemnified Parties, shall resist and defend such action or
proceeding by counsel reasonably satisfactory to Tenant. Notwithstanding
anything to the contrary set forth in this Lease, however, in all events and
under all circumstances, the liability of Landlord to Tenant shall be limited to
the interest of Landlord in the Property, and Tenant agrees to look solely to
Landlord's interest in the Property for the recovery of any judgment or award
against Landlord, it being intended that
9
Landlord shall not be personally liable for any judgment or deficiency. The
provisions of this SECTION 17.2.2 shall survive the expiration or termination of
this Lease.
17.3. FORCE MAJEURE. The obligations of Tenant hereunder
shall not be affected, impaired or excused, and Landlord shall have no liability
whatsoever to Tenant, with respect to any act, event or circumstance arising out
of Landlord's failure to fulfill, or delay in fulfilling any of its obligations
under this Lease by reason of labor dispute, governmental preemption of property
in connection with a public emergency or shortages of fuel, utility services,
supplies, or labor, or any other cause, whether similar or dissimilar, beyond
Landlord's reasonable control
18. DAMAGE OR DESTRUCTION.
18.1. NOTIFICATION AND REPAIR. Tenant shall give prompt
notice to Landlord and Agent of (a) any fire or other casualty to the Premises,
and (b) any damage to or defect in any part or appurtenance of the Property's
sanitary, electrical, HVAC, elevator or other systems located in or passing
through the Premises or any part thereof. Subject to the provisions of SECTION
18.3 below, if the Premises are damaged by fire or other insured casualty,
Landlord shall repair (or cause Agent to repair) the damage and restore and
rebuild the Premises (except for Tenant's Property) with reasonable dispatch
after (x) notice to it of the damage or destruction and (y) the adjustment of
the insurance proceeds attributable to such damage. Subject to the provisions of
SECTION 18.3 below, Tenant shall not be entitled to terminate this Lease and no
damages, compensation or claim shall be payable by Landlord for purported
inconvenience, loss of business or annoyance arising from any repair or
restoration of any portion of the Premises pursuant to this Section. Landlord
(or Agent, as the case may be) shall use its diligent, good faith efforts to
make such repair or restoration promptly and in such manner as not to
unreasonably interfere with Tenant's use and occupancy of the Premises, but
Landlord or Agent shall not be required to do such repair or restoration work
except during normal business hours of business days.
18.2. RENTAL ABATEMENT. If (a) the Premises are damaged by
fire or other casualty thereby causing the Premises to be inaccessible or (b)
the Premises are partially damaged by fire or other casualty, the Rent shall be
proportionally abated to the extent of any actual loss of use of the Premises by
Tenant.
18.3. TOTAL DESTRUCTION. If the Premises shall be totally
destroyed by fire or other casualty, or if the Premises shall be so damaged by
fire or other casualty that (in the reasonable opinion of a reputable contractor
or architect designated by Landlord): (i) its repair or restoration requires
more than 180 days or (ii) such repair or restoration requires the expenditure
of more than 50% of the full insurable value of the Premises immediately prior
to the casualty or (iii) the damage (x) is less than the amount stated in (ii)
above, but more than 10% of the full insurable value of the Premises; and (y)
occurs during the last two years of Lease Term, Landlord and Tenant shall each
have the option to terminate this Lease (by so advising the other, in writing)
within 10 days after said contractor or architect delivers written notice of its
opinion to Landlord and Tenant, but in all events prior to the commencement of
any restoration of the Premises by Landlord. In such event, the termination
shall be effective as of the date upon which either Landlord or Tenant, as the
case may be, receives timely written notice from the other terminating this
Lease pursuant to the preceding sentence. If neither Landlord nor Tenant timely
delivers a termination notice, this Lease shall remain in full force and effect.
If (A) any holder of a mortgage or deed of trust encumbering the Premises or
landlord pursuant to a ground lease encumbering the Premises (collectively,
"SUPERIOR PARTIES") or other party entitled to the insurance proceeds fails to
make such proceeds available to Landlord in an amount sufficient for restoration
of the Premises, or (B) the issuer of any casualty insurance policies on the
Premises fails to make available to Landlord (for any reason other than
Landlord's failure to timely pay requisite premiums) sufficient proceeds for
restoration of the Premises, then Landlord may, at Landlord's sole option,
terminate this Lease by giving Tenant written notice to such effect within 30
days after Landlord receives notice from the Superior Party or insurance
company, as the case may be, that such proceeds shall not be made available, in
which event the termination of this Lease shall be effective as of the date
Tenant receives written notice from Landlord of Landlord's election to terminate
this Lease. For purposes of this SECTION 18.3 only, "FULL INSURABLE VALUE" shall
mean replacement cost, less the cost of footings, foundations and other
structures below grade.
19. EMINENT DOMAIN. If the whole, or any substantial portion, of the
Premises is taken or condemned for any public use under any Law or by right of
eminent domain, or by private purchase in lieu thereof, and such taking would
prevent or materially interfere with the Permitted Use of the Premises, this
Lease shall terminate effective when the physical taking of said Premises
occurs. If less than a substantial portion of the Premises is so taken or
condemned, or if the taking or condemnation is temporary (regardless of the
portion of the Premises affected), this Lease shall not terminate, but the Rent
payable hereunder shall be proportionally abated to the extent of any actual
loss of use of the Premises by Tenant. Landlord shall be entitled to any and all
payment, income, rent or award, or any interest therein whatsoever, which may be
paid or made in connection with such a taking or conveyance, and Tenant shall
have no claim against Landlord for the value of any unexpired portion of this
Lease. Notwithstanding the foregoing, any compensation specifically awarded to
Tenant for loss of business or goodwill, for relocation costs, for moving
expenses, or for its personal property, shall be the property of Tenant.
20. SURRENDER AND HOLDOVER. On the last day of the Term, or upon any
earlier termination of this Lease, or upon any re-entry by Landlord upon the
Premises, (a) Tenant shall quit and surrender the Premises to Landlord
"broom-clean" and in good order, condition and repair, except for ordinary wear
and tear and such damage or destruction as Landlord is required to repair or
restore under this Lease, and (b) Tenant shall remove all of Tenant's Property
therefrom, except as otherwise expressly provided in this
10
Lease. The obligations imposed under the preceding sentence shall survive the
termination or expiration of this Lease. If Tenant remains in possession after
the Expiration Date hereof or after any earlier termination date of this Lease
or of Tenant's right to possession: (i) Tenant shall be deemed a tenant-at-will;
(ii) Tenant shall pay 125% of the aggregate of the Base Rent and Additional Rent
last prevailing hereunder, and also shall pay all actual damages sustained by
Landlord, directly by reason of Tenant's remaining in possession after the
expiration or termination of this Lease; (iii) there shall be no renewal or
extension of this Lease by operation of law; and (iv) the tenancy-at-will may be
terminated upon 30 days' written notice from Landlord. The provisions of this
SECTION 20 shall not constitute a waiver by Landlord of any re-entry rights of
Landlord provided hereunder or by law.
21. EVENTS OF DEFAULT.
21.1. BANKRUPTCY OF TENANT. It shall be a default by Tenant
under this Lease if Tenant makes an assignment for the benefit of creditors, or
files a voluntary petition under any state or federal bankruptcy or insolvency
law, or an involuntary petition alleging an act of bankruptcy or insolvency is
filed against Tenant under any state or federal bankruptcy or insolvency law
that is not dismissed within 90 days, or whenever a petition is filed by or
against (to the extent not dismissed within 90 days) Tenant under the
reorganization provisions of the United States Bankruptcy Code or under the
provisions of any law or like import, or whenever a petition shall be filed by
Tenant under the arrangement provisions of the United States Bankruptcy Code or
similar law, or whenever a receiver of Tenant or of, or for, the property of
Tenant shall be appointed, or Tenant admits it is insolvent or is not able to
pay its debts as they mature.
21.2. DEFAULT PROVISIONS. Each of the following shall
constitute a default by Tenant under this Lease: (a) if Tenant fails to pay Rent
or any other payment when due hereunder within seven (7) days after written
notice from Landlord of such failure to pay on the due date; provided, however,
that if in any consecutive 12 month period, Tenant shall, on three separate
occasions, fail to pay any installment of Rent on the date such installment of
Rent is due, then, on the third such occasion and on each occasion thereafter on
which Tenant shall fail to pay an installment of Rent on the date such
installment of Rent is due, Landlord shall be relieved from any obligation to
provide notice to Tenant, and Tenant shall then no longer have a seven (7) day
period in which to cure any such failure; or (b) if Tenant fails, whether by
action or inaction, to timely comply with, or satisfy, any or all of the
obligations imposed on Tenant under this Lease (other than the obligation to pay
Rent) for a period of thirty (30) days after Landlord's delivery to Tenant of
written notice of such default under this SECTION 21.2(B); provided, however,
that if the default cannot, by its nature, be cured within such thirty (30) day
period, but Tenant commences and diligently pursues a cure of such default
promptly within the initial thirty (30) day cure period, then Landlord shall not
exercise its remedies under SECTION 22 unless such default remains uncured for
more than sixty (60) days after Landlord's notice. Except for notices expressly
provided for in this Lease, Tenant hereby waives all notices of any nature,
including, without limitation, all notices under the Pennsylvania Landlord and
Tenant Act, as amended.
22. RIGHTS AND REMEDIES.
22.1. LANDLORD'S CURE RIGHTS UPON DEFAULT OF TENANT. If
Tenant defaults in the performance of any of its obligations under this Lease,
Landlord, without thereby waiving such default, may (but shall not be obligated
to) perform the same for the account, and at the expense of, Tenant upon
compliance with any notice requirements and cure periods set forth in SECTION
21.2.
22.2. LANDLORD'S REMEDIES. In the event of any default by
Tenant under this Lease, Landlord, at its option, and after any applicable
notice and cure period (required pursuant to SECTION 21.2), but without
additional notice or demand from Landlord, if any, as provided in SECTION 21.2
has expired, may, in addition to all other rights and remedies provided in this
Lease, or otherwise at law or in equity: (a) terminate this Lease and Tenant's
right of possession of the Premises; or (b) terminate Tenant's right of
possession of the Premises without terminating this Lease; provided, however,
that Landlord shall use its reasonable efforts, whether Landlord elects to
proceed under Subsections (a) or (b) above, to mitigate damages by reletting the
Premises, or any part thereof for the account of Tenant, for such rent and term
and upon such terms and conditions as are acceptable to Landlord. For purposes
of any reletting, Landlord is authorized to decorate, repair, alter and improve
the Premises to the extent deemed necessary by Landlord, in its sole, but
reasonable, discretion. In the event of the termination of this Lease by
Landlord pursuant to (a) above, Landlord shall be entitled to recover from
Tenant (i) all damages and other sums that Landlord is entitled to recover under
any provision of this Lease or at law or in equity, including, but not limited
to, all fixed dollar amounts of Base Rent and Additional Rent accrued and unpaid
for the period up to and including such termination date; (ii) all other
additional sums payable by Tenant, or for which Tenant is liable, or in respect
of which Tenant has agreed to indemnify Landlord, under any of the provisions of
this Lease, that may be then owing and unpaid; (iii) all costs and expenses
(including, without limitation, court costs and attorneys' reasonable fees)
incurred by Landlord in the enforcement of its rights and remedies under this
Lease; and (iv) any damages provable by Landlord as a matter of law including,
without limitation, an amount equal to the positive difference, if any, between
(x) the DISCOUNTED PRESENT VALUE (AT 6% PER ANNUM) of the Base Rent required to
be paid for the remainder of the Term (measured from the effective termination
date of this Lease) and (y) the fair market rental value of the Leased Premises
(determined at the date of termination of this Lease) after deduction (from such
fair market rental value)of the projected costs and expenses of reletting the
Premises (including the anticipated costs of repairs, alterations, improvements,
additions, legal fees and brokerage commissions) as reasonably estimated by
Landlord. If Landlord elects to pursue its rights and remedies under Subsection
(b) above, and the Premises are relet and a sufficient sum is not realized
therefrom, then to satisfy the payment, when due, of Base Rent and Additional
Rent reserved under the Lease for any monthly period (after payment of all
Landlord's reasonable expenses of reletting), Tenant shall, in Landlord's sole
judgment,
11
either (i) pay any such deficiency monthly or (ii) pay such deficiency on an
accelerated basis, which accelerated deficiency shall be discounted at a rate of
6% per annum. If Landlord elects to pursue its rights and remedies under
Subsection (b) above, and Landlord fails to relet the Premises, then Tenant
shall pay to Landlord the sum of (x) the projected costs of Landlord's expenses
of reletting (including the anticipated costs of repairs, alterations,
improvements, additions, legal fees and brokerage commissions) as reasonably
estimated by Landlord and (y) the accelerated amount of Base Rent and Additional
Rent due under the Lease for the balance of the Term, discounted at a rate of 6%
per annum. Tenant agrees that Landlord may file suit to recover any sums due to
Landlord hereunder from time to time and that such suit or recovery of any
amount due Landlord hereunder shall not be any defense to any subsequent action
brought for any amount not theretofore reduced to judgment in favor of Landlord.
If Landlord elects to pursue its rights and remedies under Subsection (b), then
Landlord shall at any time have the further right and remedy to rescind such
election and pursue its rights and remedies under Subsection (a). In the event
Landlord elects, pursuant to clause (b) of this SECTION 22.2, to terminate
Tenant's right of possession only, without terminating this Lease, Landlord may,
at Landlord's option, enter into the Premises, remove Tenant's Property,
Tenant's signs and other evidences of tenancy, and take and hold possession
thereof, as provided in SECTION 20 hereof; provided, however, that such entry
and possession shall not terminate this Lease or release Tenant, in whole or in
part, from Tenant's obligation to pay the Base Rent and Additional Rent reserved
hereunder for the full Term, or from any other obligation of Tenant under this
Lease. Any and all property that may be removed from the Premises by Landlord
pursuant to the authority of the Lease or of law, to which Tenant is or may be
entitled, may be handled, removed or stored by Landlord at the risk, cost and
expense of Tenant, and in no event or circumstance shall Landlord be responsible
for the value, preservation or safekeeping thereof. Tenant shall pay to
Landlord, upon demand, any and all expenses incurred in such removal and all
storage charges against such property so long as the same shall be in Landlord's
possession or under Landlord's control. Any such property of Tenant not retaken
from storage by Tenant within 30 days after the end of the Term, however
terminated, shall be conclusively presumed to have been conveyed by Tenant to
Landlord under this Lease as in a ▇▇▇▇ of sale, without further payment or
credit by Landlord to Tenant.
22.3. ADDITIONAL RIGHTS OF LANDLORD. Any and all costs,
expenses and disbursements, of any kind or nature, incurred by Landlord or Agent
in connection with the enforcement of any and all of the terms and provisions of
this Lease, including attorneys' reasonable fees (through all appellate
proceedings), shall be due and payable (as Additional Rent) upon Landlord's
submission of an invoice therefor. All sums advanced by Landlord or Agent on
account of Tenant under this Section, or pursuant to any other provision of this
Lease, and all Base Rent and Additional Rent, if delinquent or not paid by
Tenant and received by Landlord when due hereunder, shall bear interest at the
rate of 5% per annum above the "prime" or "reference" or "base" rate (on a per
annum basis) of interest publicly announced as such, from time to time, by the
First Chicago/NBD Bank, from the due date thereof until paid, and such interest
shall be and constitute Additional Rent and be due and payable upon Landlord's
or Agent's submission of an invoice therefor. The various rights, remedies and
elections of Landlord reserved, expressed or contained herein are cumulative and
no one of them shall be deemed to be exclusive of the others or of such other
rights, remedies, options or elections as are now or may hereafter be conferred
upon Landlord by law.
22.4. EVENT OF BANKRUPTCY. In addition to, and in no way
limiting the other remedies set forth herein, Landlord and Tenant agree that if
Tenant ever becomes the subject of a voluntary or involuntary bankruptcy,
reorganization, composition, or other similar type proceeding under the federal
bankruptcy laws, as now enacted or hereinafter amended, then: (a) "adequate
assurance of future performance" by Tenant and/or any assignee of Tenant
pursuant to Bankruptcy Code Section 365 will include (but not be limited to)
payment of an additional/new security deposit in the amount of three times the
then current Base Rent payable hereunder; (b) any person or entity to which this
Lease is assigned, pursuant to the provisions of the Bankruptcy Code, shall be
deemed, without further act or deed, to have assumed all of the obligations of
Tenant arising under this Lease on and after the effective date of such
assignment. Any such assignee shall, upon demand by Landlord, execute and
deliver to Landlord an instrument confirming such assumption of liability; (c)
notwithstanding anything in this Lease to the contrary, all amounts payable by
Tenant to or on behalf of Landlord under this Lease, whether or not expressly
denominated as "Rent", shall constitute "rent" for the purposes of Section
502(b)(6) of the Bankruptcy Code; and (d) if this Lease is assigned to any
person or entity pursuant to the provisions of the Bankruptcy Code, any and all
monies or other considerations payable or otherwise to be delivered to Landlord
or Agent (including Base Rent, Additional Rent and other amounts hereunder),
shall be and remain the exclusive property of Landlord and shall not constitute
property of Tenant or of the bankruptcy estate of Tenant. Any and all monies or
other considerations constituting Landlord's property under the preceding
sentence not paid or delivered to Landlord or Agent shall be held in trust by
Tenant or Tenant's bankruptcy estate for the benefit of Landlord and shall be
promptly paid to or turned over to Landlord.
22.5. CONFESSION OF JUDGMENT FOR POSSESSION.
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TENANT, IN CONSIDERATION OF THE EXECUTION OF THIS LEASE BY LANDLORD AND
FOR THE COVENANTS AND AGREEMENTS ON THE PART OF LANDLORD HEREIN CONTAINED, AND
FULLY COMPREHENDING THE RELINQUISHMENT OF CERTAIN RIGHTS INCLUDING RIGHTS OF
PREJUDGMENT NOTICE AND HEARING AND POST JUDGMENT/PRE-EXECUTION NOTICE AND
HEARING, AND AFTER DEFAULT BY TENANT UNDER THIS LEASE, HEREBY EXPRESSLY
AUTHORIZES ANY ATTORNEY OF ANY COURT OF RECORD TO ACCEPT SERVICE OF PROCESS FOR,
TO APPEAR FOR, AND TO CONFESS JUDGMENT IN EJECTMENT AGAINST TENANT FOR
POSSESSION OF THE PREMISES IN ANY AND ALL ACTIONS BROUGHT HEREUNDER BY LANDLORD
AGAINST TENANT TO RECOVER POSSESSION FROM TIME TO TIME OF THE PREMISES (AND
TENANT AGREES THAT UPON THE ENTRY OF EACH JUDGMENT FOR SUCH POSSESSION A WRIT OF
POSSESSION OR OTHER APPROPRIATE PROCESS MAY ISSUE FORTHWITH). THE RIGHT TO
CONFESS JUDGMENT IN EJECTMENT SHALL NOT BE EXHAUSTED BY THE SINGLE OR MULTIPLE
USE THEREOF. TENANT CONFIRMS THAT THIS IS A COMMERCIAL LEASE, THAT TENANT WAS
REPRESENTED BY COUNSEL IN TENANT'S NEGOTIATION AND EXECUTION OF THIS LEASE, AND
THAT TENANT KNOWINGLY, WILLINGLY, FREELY AND VOLUNTARILY EXECUTED THIS LEASE
WITH THIS SECTION AS A PART THEREOF.
23. BROKER. Tenant covenants, warrants and represents that the broker
set forth in SECTION 1.8(A) was the only broker to represent Tenant in the
negotiation of this Lease ("TENANT'S BROKER"). Landlord covenants, warrants and
represents that the broker set forth in SECTION 1.8(B) was the only broker to
represent Landlord in the negotiation of this Lease ("LANDLORD'S BROKER").
Landlord shall be solely responsible for paying the commission of Landlord's
Broker. Each party agrees to and hereby does defend, indemnify and hold the
other harmless against and from any brokerage commissions or finder's fees or
claims therefor by a party claiming to have dealt with the indemnifying party
and all costs, expenses and liabilities in connection therewith, including,
without limitation, reasonable attorneys' fees and expenses, for any breach of
the foregoing. The foregoing indemnification shall survive the termination of
this Lease for any reason.
24. MISCELLANEOUS.
24.1. MERGER. All prior understandings and agreements
between the parties are merged in this Lease, which alone fully and completely
expresses the agreement of the parties. No agreement shall be effective to
modify this Lease, in whole or in part, unless such agreement is in writing, and
is signed by the party against whom enforcement of said change or modification
is sought.
24.2. NOTICES. Any notice required to be given by either
party pursuant to this Lease, shall be in writing and shall be deemed to have
been properly given, rendered or made only if personally delivered, or if sent
by Federal Express or other comparable commercial overnight delivery service,
addressed to the other party at the addresses set forth below (or to such other
address as Landlord or Tenant may designate to each other from time to time by
written notice), and shall be deemed to have been given, rendered or made on the
day so delivered or on the first business day after having been deposited with
the courier service:
IF TO LANDLORD:
First Industrial, L.P.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: Vice President - Portfolio Management
WITH A COPY TO:
First Industrial Realty Trust, Inc.
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Attn: ▇▇. ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, ▇▇., Regional Director
WITH A COPY TO:
Saul, Ewing, ▇▇▇▇▇▇ & ▇▇▇▇ LLP
Centre Square West
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ - ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Attn: F. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, Esquire
13
IF TO TENANT:
Protarga, Inc.
▇▇▇▇ ▇. ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇ ▇▇▇▇▇▇ IV, Vice-President and Chief
Financial Officer
WITH A COPY TO:
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Esq.
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ LLP
3000 Two ▇▇▇▇▇ Square
Eighteenth and ▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
24.3. NON-WAIVER. The failure of either party to insist, in
any one or more instances, upon the strict performance of any one or more of the
obligations of this Lease, or to exercise any election herein contained, shall
not be construed as a waiver or relinquishment for the future of the performance
of such one or more obligations of this Lease or of the right to exercise such
election, but the Lease shall continue and remain in full force and effect with
respect to any subsequent breach, act or omission. The receipt and acceptance by
Landlord or Agent of Base Rent or Additional Rent with knowledge of breach by
Tenant of any obligation of this Lease shall not be deemed a waiver of such
breach.
24.4. LEGAL COSTS. Any party in breach or default under
this Lease (the "DEFAULTING PARTY") shall reimburse the other party (the
"NONDEFAULTING PARTY") upon demand for any legal fees and court (or other
administrative proceeding) costs or expenses that the Nondefaulting Party incurs
in connection with the breach or default, regardless whether suit is commenced
or judgment entered. Such costs shall include legal fees and costs incurred for
the negotiation of a settlement, enforcement of rights or otherwise.
Furthermore, in the event of litigation, the court in such action shall award to
the party in whose favor a judgment is entered a reasonable sum as attorneys'
fees and costs, which sum shall be paid by the losing party. Tenant shall pay
Landlord's attorneys' reasonable and actual fees (supported by invoices), not to
exceed $1500.00, incurred in connection with Tenant's request for Landlord's
consent under provisions of this Lease governing assignment and subletting, or
in connection with any other act which Tenant proposes to do and which requires
Landlord's consent.
24.5. PARTIES BOUND. Except as otherwise expressly provided
for in this Lease, this Lease shall be binding upon, and inure to the benefit
of, the successors and assignees of the parties hereto. Tenant hereby releases
Landlord named herein from any obligations of Landlord for any period subsequent
to the conveyance and transfer of Landlord's ownership interest in the Premises
and the assumption by the transferee of Landlord's obligations under this Lease
from and after the date of transfer. In the event of such conveyance and
transfer, Landlord's obligations shall thereafter be binding upon each
transferee (whether Successor Landlord or otherwise). No obligation of Landlord
shall arise under this Lease until the instrument is signed by, and delivered
to, both Landlord and Tenant.
24.6. RECORDATION OF LEASE. Tenant shall not record or file
this Lease (or any memorandum hereof) in the public records of any county or
state.
24.7. SURVIVAL OF OBLIGATIONS. Upon the expiration or other
termination of this Lease, neither party shall have any further obligation nor
liability to the other except as otherwise expressly provided in this Lease and
except for such obligations as, by their nature or under the circumstances, can
only be, or by the provisions of this Lease, may be performed after such
expiration or other termination.
24.8. GOVERNING LAW; CONSTRUCTION. This Lease shall be
governed by and construed in accordance with the laws of the state in which the
Premises are located. If any provision of this Lease shall be invalid or
unenforceable, the remainder of this Lease shall not be affected but shall be
enforced to the extent permitted by law. The captions, headings and titles in
this Lease are solely for convenience of reference and shall not affect its
interpretation. This Lease shall be construed without regard to any presumption
or other rule requiring construction against the party causing this Lease to be
drafted. Each covenant, agreement, obligation, or other provision of this Lease
to be performed by Tenant, shall be construed as a separate and independent
covenant of Tenant, not dependent on any other provision of this Lease. All
terms and words used in this Lease, regardless of the number or gender in which
they are used, shall be deemed to include any other number and any other gender
as the context may require. This Lease may be executed in counterpart and, when
all counterpart documents are executed, the counterparts shall constitute a
single binding instrument.
24.9. TIME. Time is of the essence of this Lease. If the
time for performance hereunder falls on a Saturday, Sunday or a day that is
recognized as a holiday in the state in which the Premises are located, then
such time shall be deemed extended to the next day that is not a Saturday,
Sunday or holiday in said state.
14
24.10. AUTHORITY . If Tenant is a corporation, partnership,
limited liability company, association or any other entity, it shall deliver to
Landlord, concurrently with the delivery to Landlord of an executed Lease,
certified resolutions of Tenant's directors or other governing person or body
(i) authorizing execution and delivery of this Lease and the performance by
Tenant of its obligations hereunder and (ii) certifying the authority of the
party executing the Lease as having been duly authorized to do so. Landlord
represents and warrants to Tenant that Landlord is authorized to execute,
deliver, and perform this Lease.
24.11. WAIVER OF TRIAL BY JURY. THE LANDLORD AND THE TENANT,
TO THE FULLEST EXTENT THAT THEY MAY LAWFULLY DO SO, HEREBY WAIVE TRIAL BY JURY
IN ANY ACTION OR PROCEEDING BROUGHT BY ANY PARTY TO THIS LEASE WITH RESPECT TO
THIS LEASE, THE PREMISES, OR ANY OTHER MATTER RELATED TO THIS LEASE OR THE
PREMISES.
24.12. SUBMISSION OF LEASE. Submission of this Lease to
Tenant for signature does not constitute a reservation of space or an option to
lease. This Lease is not effective until execution by and delivery to both
Landlord and Tenant.
24.13. JOINT AND SEVERAL LIABILITY. All parties signing this
Lease as Tenant shall be jointly and severally liable for all obligations of
Tenant hereunder.
24.14. RIDERS. All Riders and Exhibits attached hereto are
deemed to be a part hereof and hereby incorporated herein.
IN WITNESS WHEREOF, Landlord and Tenant have duly executed this Lease
as of the day and year first above written.
LANDLORD:
FIRST INDUSTRIAL PENNSYLVANIA, L.P., Delaware
limited partnership
By: First Industrial Pennsylvania Corporation, a
Maryland corporation and its sole general partner
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
--------------------------------------------
Its: REGIONAL DIRECTOR
-----------------------------------
TENANT:
PROTARGA, INC., a Delaware corporation
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇ IV
-----------------------------------------------
Its: V.P. FINANCE AND CFO
---------------------------------------
15
RIDER TO LEASE
THIS RIDER TO LEASE DATED JULY 12, 2000, between First Industrial
Pennsylvania, L.P. ("Landlord") and Protarga, Inc. ("Tenant").
1. LEASE YEAR. The term "lease year" as used in this Lease is
defined as set forth in this Rider Section 1. The first lease year of the Term
shall commence on the Commencement Date and shall end (i) on the day immediately
preceding the first anniversary of the Commencement Date, if the Commencement
Date is the first day of the month, or(ii) the last day of the month in which
the first anniversary of the Commencement Date occurs, if the Commencement Date
is any day other than the first day of a calendar month. Each subsequent lease
year shall be a period of twelve months, commencing on the day immediately
following the expiration of the prior lease year and expiring on the day
immediately preceding the anniversary of the commencement of such lease year.
2. SECURITY LETTER OF CREDIT. On or before three (3) days after
the date of this Lease, Tenant shall deliver to Landlord the Security Letter of
Credit (hereinafter defined) (the Security Letter of Credit and the cash
proceeds of which are referred to in this Lease as the "Security"), representing
security for the full and faithful performance and observance by Tenant of
Tenant's covenants and obligations under this Lease. In the event Tenant
defaults in the full and prompt payment or performance of any of its obligations
hereunder, Landlord may, without notice to Tenant (except for notices expressly
provided for in this Lease), draw upon the Security Letter of Credit and use,
apply, set off or retain the whole or any part of the Security, to the extent
required for the payment of any Rent or other sums due or to become due from
Tenant under this Lease, in addition to other remedies available to Landlord. In
the event Landlord shall so use, apply or retain the whole or any part of the
Security, Tenant shall, upon demand, immediately deliver to Landlord cash equal
to the amount so used, which cash shall be part of the Security. The drawing of
the Security Letter of Credit and use, application or retention of the Security,
or any portion thereof, by Landlord shall not prevent Landlord from exercising
any other right or remedy provided by this Lease or by law or in equity (it
being intended that Landlord shall not first be required to proceed against the
Security) and shall not operate as a limitation on any recovery to which
Landlord may otherwise be entitled. If Tenant shall fully and faithfully comply
with all the terms, covenants, and conditions of this Lease, and provided that
Tenant has fully satisfied all of the obligations of Tenant under this Lease,
the Security (or any balance thereof) shall be returned or paid over to Tenant
within thirty (30) days after the last to occur of (i) the date on which the
Term has expired or is terminated, or (ii) delivery to Landlord of possession of
the Premises. It is agreed and understood that the obligations of Tenant to
Landlord hereunder that are not performed prior to the expiration date shall be
continuing obligations owed by Tenant to Landlord and shall survive the
termination of this Lease. Landlord may deliver the Security Letter of Credit
and other Security to any purchaser of Landlord's interest in the Premises (or
any Successor Landlord , if applicable), and upon delivery of the Security
Letter of Credit and other Security to the purchaser or Successor Landlord,
Landlord shall be discharged of and from any further liability with respect to
same. "Security Letter of Credit", as used in this Lease, shall mean one (1)
letter of credit in the initial face amount of One Hundred Sixty Thousand
Dollars ($160,000.00), such letter of credit to be an irrevocable, transferable,
and assignable letter of credit obtained by Tenant and issued to Landlord by a
United States national bank, having a transactional office in Philadelphia,
Pennsylvania , with assets of at least Two Billion Dollars ($2,000,000,000.00),
in the form of Exhibit "Security Letter of Credit" attached hereto and made a
part hereof (except, as to any substitute Security Letter of Credit, for the
expiration date which, as to any such substitute Security Letter of Credit, must
comply with the next sentence). Tenant shall deliver to Landlord, on or before
sixty (60) days before expiration of the then effective Security Letter of
Credit, a substitute Security Letter of Credit expiring no sooner than twelve
(12) months after the date of issuance in an amount equal to the amount required
by this Rider Section 2. Provided that Tenant is not in default under this Lease
at the time of request for reduction of the Security Letter of Credit and has
not been in default under this Lease more than two (2) times in the twelve (12)
months preceding the request for reduction of the Security Letter of Credit,
Tenant shall have the right to reduce the Security Letter of Credit from the
initial face amount of One Hundred Sixty Thousand Dollars ($160,000.00) to (a)
One Hundred Twenty Thousand Dollars ($120,000.00) subject to the further
condition that Tenant shall have maintained an aggregate available cash balance
of at least Five Million Dollars ($5,000,000.00), as evidenced by account
statements from the financial institutions holding Tenant's funds and including
if not otherwise included, the amount of the Security Letter of Credit,, for
three (3) out of the five (5) consecutive calendar months immediately preceding
the request for reduction and (b) Eighty Thousand Dollars ($80,000.00)
commencing no sooner than twelve (12) months after the last previous reduction
of the Security Letter of Credit, subject to the further condition that Tenant
shall have maintained an aggregate available cash balance of at least Five
Million Dollars ($5,000,000.00), as evidenced by account statements from the
financial institutions holding Tenant's funds and including if not otherwise
included, the amount of the Security Letter of Credit, for three (3) out of the
five (5) consecutive calendar months immediately preceding the request for
reduction. Provided that Tenant is not in default under this Lease at the time
of request for reduction of the Security Letter of Credit and has not been in
default under this Lease more than two (2) times in the twelve (12) months
preceding the request for reduction of the Security Letter of Credit, Tenant
shall have the right to reduce the Security Letter of Credit from the initial
face amount of One Hundred Sixty Thousand Dollars ($160,000.00) to (a) One
Hundred Thousand Dollars ($100,000.00) subject to the further condition that
Tenant shall have maintained an aggregate available cash balance of at least
Seven Million Dollars ($7,000,000.00), as evidenced by account statements from
the financial institutions holding Tenant's funds and including if not otherwise
included, the amount of the Security Letter of Credit, for three (3) out of the
five (5) consecutive calendar months immediately preceding the request for
reduction and (b) Sixty Thousand Dollars ($60,000.00) commencing no sooner than
twelve (12) months after the last previous reduction of the Security Letter of
Credit, subject to the further condition that Tenant shall have maintained an
aggregate available cash balance of at least Seven Million Dollars
($7,000,000.00), as evidenced by account statements from the financial
institutions holding Tenant's funds and including if not otherwise
16
included, the amount of the Security Letter of Credit, for three (3) out of the
five (5) consecutive calendar months immediately preceding the request for
reduction. Upon at least five (5) days notice to Tenant and without limitation
on Landlord's other rights to draw on the Security Letter of Credit, Landlord
shall have the right to draw the full amount of the Security Letter of Credit if
Tenant does not deliver to Landlord a substitute Security Letter of Credit on or
before sixty (60) days before the expiration of the then effective Security
Letter of Credit. All costs associated with the Security Letter of Credit shall
be paid by Tenant.
3. LANDLORD'S DEFAULT. If Landlord shall be in default in the
performance of any of its obligations under this Lease for thirty (30)
consecutive days after written notice from Tenant (unless such default is not
susceptible of cure within thirty (30) days in which event Landlord shall have
failed to commence curing such default within such thirty (30) day period and to
diligently prosecute such cure to completion), then Tenant shall notify Landlord
in writing if Tenant intends to cure such default on behalf of Landlord. If, ten
(10) days following such second notice Landlord has failed to commence curing
such default, Tenant shall have the right to cure the default on behalf of
Landlord. Landlord shall reimburse Tenant for any sums reasonably paid to third
parties or third party costs reasonably incurred by Tenant in curing such
default, including interest thereon from the date of Landlord's receipt of
Tenant's ▇▇▇▇ therefor, within ten (10) days after Landlord receives a ▇▇▇▇
therefor (which ▇▇▇▇ shall set forth in reasonable detail the costs for which
compensation is claimed). Notwithstanding the foregoing, Tenant shall not have
any right in exercising its remedies under the preceding sentence to make any
repairs or modifications to areas outside the Premises, except those solely
serving the Premises.
4. OPTION TO EXTEND.
(a) Tenant is granted one (1) option (the "Extension
Option") to extend the Term for one (1) additional period of three (3) years
(the "Extension Term") immediately following the Expiration Date. The Extension
Option is granted subject to the following conditions:
(i) The Extension Option must be exercised, if
at all, by notice from Tenant to Landlord given on or before One Hundred Eighty
(180) days before the Expiration Date, time being of the essence.
(ii) At the time of exercise of the Extension
Option, and the commencement of the Extension Term, this Lease must be in full
force and effect and there may be no uncured event of default beyond an
applicable cure period in the performance of Tenant's obligations under this
Lease.
(b) All terms, provisions and conditions contained in
this Lease shall continue to apply during the Extension Term, except that:
(i) the annual Base Rent payable for first lease
year of the Extension Term shall be $196,980.00, for the second lease year of
the Extension Term shall be $202,608.00, and for the third lease year of the
Extension Term shall be $208,236.00.
(ii) there shall be no further right of renewal
5. LANDLORD INITIAL REPAIR. Landlord, at Landlord's sole cost,
shall perform the following tasks before the Commencement Date: Install ID name
plates at 2 electrical service entrance points (each service entrance point
should ID the other service entrance point; Test existing emergency lighting and
exit identification; restripe parking area lines.
6. NO CONSEQUENTIAL DAMAGES. Notwithstanding any provision in
this Lease, in no event shall Landlord or Tenant be liable (including, without
limitation, under any indemnity set forth in this Lease) for any speculative or
consequential damages in connection with this Lease, the use of the Premises or
for any other reason whatsoever and all such damages are hereby waived.
7. FINANCIAL INFORMATION. Tenant shall furnish to Landlord:
(a) If and to the extent prepared by Tenant in the ordinary
course of its business, as soon as available and in any event within sixty (60)
days after the end of each quarterly accounting period in each fiscal year of
Tenant, copies of the balance sheet of Tenant as of the last day of such
quarterly accounting period, and copies of the related statements of income and
of changes in shareholders' equity and in financial position of Tenant for such
quarterly accounting period all prepared in accordance with Tenant's ordinary
and customary accounting and reporting procedures;
(b) As soon as available and in any event within ninety (90)
days after the end of each fiscal year of Tenant, copies of the balance sheet of
Tenant as of the end of such fiscal year, and copies of the related statements
of income and of changes in shareholders' equity and in financial position of
Tenant for such fiscal year, all prepared in accordance with Tenant's ordinary
and customary accounting and reporting procedures
8. EARLY ACCESS. Subject to Landlord's reasonable
requirements imposed to assure that Landlord and Landlord's contractors can work
on the Premises without interference or delay and subject to applicable
governmental requirements, Tenant may have access to the Premises after July 22,
2000 and before the Commencement Date, solely for the purpose of preparing the
Premises for Tenant's use occupancy, provided, however, that in connection with
such access Tenant shall not interfere with or delay the completion of the Work
Items or Landlord's work under Section 5 of this Rider. In connection with such
early access,
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Tenant shall be bound by all of the obligations of Tenant under this Lease and
all provisions applicable to Tenant under this Lease, except for the payment of
Rent.
END OF RIDER TO LEASE
18
LEASE EXHIBIT "A"
Lot, Building (11,256 square feet), Improvements and Property commonly known as
▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ and also described as ▇▇▇ ▇▇. ▇▇
(approx. 2.648 acres), together with the buildings and improvements thereon, in
the ▇▇▇▇▇▇▇▇▇ Creek Industrial Park, Uwchlan Township, ▇▇▇▇▇▇▇ County,
Pennsylvania, as shown and described on Subdivision and General Development
Plans of ▇▇▇▇▇▇▇▇▇ Creek Industrial Park made by ▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Inc., Division
of ▇▇▇▇▇▇▇ Valley Engineers, Paoli, Pennsylvania, dated July 29, 1967, last
revised September 26, 1980 and recorded in the Recorder of Deeds Office of
▇▇▇▇▇▇▇ County, Pennsylvania as Plan No. 3362.
LEASE EXHIBIT "B"
LANDLORD'S WORK ITEMS
Landlord agrees to complete the following work, in the areas and rooms of the
Premises that are more fully described on the "Landlord's Work Floor Plan"
attached to this Lease as EXHIBIT B-1:
1. Repair broken floor tiles as needed.
2. In-kind replacement of plastic laminate bench tops in two
interior laboratory equipment rooms (approx. 110 LF total).
3. Upgrade 18 air terminal devices (diffusers) in laboratory
areas to direct discharge away from hood openings and to reduce air noise.
4. Rebalance existing HVAC-laboratory exhaust system based on
standard 18" high sash height instead of 24" height.
5. Replace damaged ceiling tiles as needed.
6. Repaint rooms as shown on EXHIBIT B-1.
7. Repair wall covering in rooms 5, 9, 16.
8. Install GFI receptacles for wet locations.
9. Replace carpet as shown on EXHIBIT B-1.
10. Clean flooring, bench top, and hood areas throughout.
Landlord and Tenant agree that the list of Work Items may be
changed after the date of execution of the Lease. If the list of Work Items is
so changed, such changed shall be evidenced by a writing signed by Landlord and
Tenant.
LEASE EXHIBIT B-1
LANDLORD'S WORK FLOOR PLAN
2
[LANDLORD'S WORK FLOOR PLAN DIAGRAM]
3
LEASE EXHIBIT "1.11"
Base Rent shall be payable as follows:
ANNUAL BASE RENT MONTHLY BASE RENT
First Lease Year $169,380.00 $14,115.00
Second Lease Year $175,044.00 $14,587.00
Third Lease Year $180,720.00 $15,060.00