SECOND AMMENDMENT OF LEASE
DATE: as of September 9,1999
LANDLORD: LEONIA Associates, L.I.C.
a New Jersey limited liability company.
Tenant: Computer Outsourcing Services,Inc.
a New York corporation
ADDRESS OF TENANT: ▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
LEASE DATE: June 2, 1997
DATE OF PRIOR
AMENDMENTS: January 16, 1998
BUILDING: ▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
RECITALS
WHEREAS, Landlord and Tenant entered into a lease agreement dated
June 2, 1997 (the "Original Lease") wherein Tenant leased a portion of
the Building:
WHEAREAS, the first lease amendment dated January 16,1998("First Lease
("First Lease Amenment")provided for certain changes including an increase
in the square footage of the Premises and an increase in Fixed Basic Rent,
Additional Rent and number of parking spaces:
WHERAS, the parties now intend to further modify the Lease.
NOW,THEREFORE, in consideration of the mutual convenants herein
contained it is hereby agreed as follows:
1. The Lease, For the purpose of this Second Lease Amendment, the
term "Lease" shall be defined as the Original Lease as amended by the First
Lease Amendment. Unless otherwise defined herein, the capitalized terms
shall have the meaning ascribed to it in the Lease.
2. Tenant Renovations. Tenant desires to renovate the Premises and
landlord is willing to allow Tenant to do so. Tenant shall have the
right to perform the improvement indicated on Exhibit "A" attached hereto
("Tenant Renovations"), subject to Landlord's comments on Exhibit A-1.
Landlord must approve any material modification to the attached plans.
For the purposes of this paragraph, Tenant Renovations shall include all
work in Exhibit "A" and shall be performed in a workmanlike manner and in
compliance with all local and federal laws and ordiances.
3. Tenant's Restoration of the Demised Premises. Notwithstanding
anything to the contary contained in this Amendment, Tenant hereby covenants
and argees that it shall, at its sole cost and expense, return the Demised
Premises to its original structurally sound condition, as per the attached
plans shown on Exhibit "B" prior to Tenant's performance of any Tenant
Renovations as same is set forth below, at such time, if at all, as the
Tenant should vacate the Building pursuant to the terms of the Lease
Agreement or otherwise, reasonable wear and tear exxpected. At Landlord's
option, Tenant shall pay to Landlord the cost of such restoration and
lANDLORD will be responsible to perform the necessary work. In the event,
Landlord will provide Tenant with two proposals comparable in scope of
work for the cost of such restoration and Tenant will obtain one
comparable bid proposal. The amount of the payment by Tenant to Landlord
shall be the lowest of three bids, provided same is comparable in scope of
work.Regardless of the amount of the lowest bid proposal obtained, the
maximum amount that the Tenant will be required to pay to Landlord is
$300,000. If the lease should be extended to December 31,2021 or beyond
and at the end of such period, Tenant is not in default under the Lease,
this paragraph shall be null and void.
4. Tenant Renovations Budget. Tenant Renovations to be made in the
aggregate amount of approximately $2,944,950 are set forth in Exhibit "C"
attached hereto. Upon the later of the completion of $2,000,000 of Tenant
Renovations of November 1,1999, Landlord shall pay for $2,000,000 of
Tenant's Renovations (including delivery,installation,and sales tax)
described in Exhibit "C" and be the owner of such items. The cost of the
remaining Tenant Renovations shall be borne by Tenant.
5. Term. Paragraph (15) and (16) of the Preamble to the Lease is
hereby modified to provide that the Term shall be extended and the
termination date shall be December 31,2014.
6. Fixed Basic Rent.
1. Paragraph 3, Section IV, of the First Amendment of Lease is hereby
modified to provide that Fixed Basic Rent for the period of
November 1,1999 through December 31,2002 shall mean THREE MILLION NINE
HUNDRED TWENTY FOUR THOUSAND FIVE HUNDREDFORTY-FIVE AND 76/100
($3,924,545.76) DOLLARS.
(A) Yearly Rate: ONE MILLION TWO HUNDRED THIRTY-NINE THOUSAND THREE
HUNDRED THIRTY AND 21/100 ($1,239,330.24) Dollars.
(B) Monthly Installment: ONE HUNDRED THREE THOUSAND TWO HUNDRED
SEVENTY-SEVEN AND 52/00 ($103,277.52) DOLLARS.
II. Paragraph 3, Section v, of the First Amendment of Lease is
hereby modified to provide that Fixed Basic Rent for the period of
January 1,2003 through December 31,2008, shall mean EIGHT MILLION TWO
HUNDRED THIRTY-NINE THOUSAND NINE HUNDRED EIGHTY-ONE AND 68/100
($8,239,981.68) Dollars.
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(A) Yearly Rate: ONE MILLION THREE HUNDRED SEVENTY-THREE THOUSAND
THREE HUNDRED THIRTY AND 28/100 ($1,373,330.28) DOLLARS.
(B) Monthly Installment: ONE HUNDRED FOURTEEN THOUSAND FOUR HUNDRED
FOURTY-FOUR AND 19/00 ($114,444.19) DOLLARS.
III. Fixed Basic Rent for the period of January 1,2009 through
October 31,2009, shall mean ONE MILLION TWO HUNDRED SEVENTY-THREE
THOUSAND SIXTY-SIX AND 90/100 ($1,273,066.90) DOLLARS.
(A) Yearly Rate: Not applicable.
(B) Monthly Installment: ONE HUNDRED TWENTY-SEVEN THOUSAND THREE
HUNDRED SIX AND 69/00 ($127,306.69) DOLLARS.
IV. Fixed Basic Rent for the period of November 1,2009 through
December 31,2014, shall mean SIX MILLION ONE HUNDRED THIRTEEN THOUSAND
NINE HUNDRED SEVENTY-FIVE AND 00/100 ($6,113,975.00) DOLLARS.
(A) Yearly Rate: ONE MILLION ONE HUNDRED EIGHTY-THREE THOUSAND THREE
HUNDRED FIFTY AND 00/100 ($1,183,350.00) DOLLARS.
(B) Monthly Installment: NINETY EIGHT THOUSAND SIX HUNDRED TWELVE AND
50/00 ($98,612.50) DOLLARS.
7. Extension Fee: As an inducement and consideration to Landlord
to allow Tenant to extend the Term of the Lease and Landlord's payment
as described in ▇▇▇▇▇▇▇▇▇ ▇, ▇▇▇▇▇▇ agrees to pay to Landlord
$320,503.50 as follows:
Due Date Amount
11/1/99 $ 72,000.00
1/1/09 248,503.50
8. Option. Paragraph 12 of the First Amendment of Lease and
paragraph 56 (a)of the Lease are hereby null and void and deleted in
their entirety.
9. Successor-in-Interest, This Second Amendment of Lease shall
inure to the benefit of and be binding upon the parties hereto and
their respective legal representatives, successors and permitted
assigns.
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10 Broker, Landlord and Tenant represent and warrant to each other
than no broker except for MRH Real Estate Services,Inc. and ▇▇▇▇▇▇▇ &
▇▇▇▇▇▇▇▇▇, Inc. brought about this transaction and Landlord and Tenant
agree to indemnify and hold each other harmless from any and all
claims of any broker arising out of or in connection with the
negotiations of or the entering into this Second Amendment of Lease by
the parties hereto. If such claim arises out of a breach of the
foregoing warranty to that end Landlord or Tenant shall indemnify the
other party for all loss, costs or damage including reasonable
attorney's fees arising therefrom. These representations and
warranties shall survive the termination of the Lease,as amended.
11. Definitions,Inconsistencies, In the event of any inconsistencies
between this Second Amendment of Lease and the Lease,the Second
AMENDMENT OF LEASE shall govern and be binding. All words and terms
used in this Second Amendment of Lease and not otherwise defined
herein shall have the respective meanings ascribed to them under the
Lease or unless the context clearly requires otherwise. This Second
Amendment of Lease was drafted by Landlord as a matter of convenience
and it shall be constructed for or against either party on that
account since Tenant had the opportunity to review same and make
changes thereto.
12. Ratification of Lease: Except as expressly modified and amended
by the Second Amendment of Lease, all of the terms,provisions and
conditions of the Lease are hereby ratified and confirmed by Landlord
and Tenant. Tenant hereby releases and discharges Landlord from any
and all claims or liability now arising out of the Lease prior to the
date hereof, including, but in no way limited to, any and all charges as
billed by Landlord to Tenant pursuant to the terms of the Lease.
This does not apply to any estimated ▇▇▇▇▇▇▇▇ charged to the Tenant.
In the event of a conflict between the terms of the Lease and the
terms of the Second Amendment,the terms of the Second Amendment
shall control.
13. Contingency.
(I) Paragraphs 4, 6, and 7 of the Second Amendment of Lease will
only be effective, if the following contingencies are met, otherwise
such paragraphs shall be deemed null and void at Landlord's option.
(i) Tenant shall not be in default of the Lease:
(ii) Landlord is able to close on additional financing in the
amount of $1,700,000 by November 1,1999, and
(iii) If landlord extends the foregoing contingency period on
written notice to Tenant all time periods and rental amounts
set forth in Paragraph 6 and the date in Paragraph 4 shall be
adjusted accordingly.
(II) In addition,if the contingencies are not met, Paragraph 3
of the First Amendment of Lease shall be modified to provide that
Fixed Basic Rent for the period of January 1,2009 through
December 31,2014 shall mean SEVEN MILLION ONE HUNDRED THOUSAND ONE
HUNDRED AND 00/100 ($7,100,100.00) DOllars.
4
(A) Yearly Rate: ONE MILLION ONE HUNDRED EIGHTY-THREE THOUSAND
THREE HUNDRED FIFTY AND 00/00 ($1,183,350.00) DOLLARS.
(B) Monthly Installment: NINETY-EIGHT THOUSAND SIX HUNDRED
TWELVE AND 50/100 ($98,612.50) DOLLARS.
IN WITNESS WHEREOF, the parties have set their hands and seals
the date above first written.
WITNESS: LEONIA ASSOCIATES,L.I.C.
By: Jeffco Holding Ltd.
its Managing Member
/s/ ▇▇▇▇ ▇▇▇▇▇ By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇
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▇▇▇▇▇▇▇ ▇.▇▇▇▇,President
WITNESS: COMPUTER OUTSOURCING SERVICES,INC.
By: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
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Name: ▇▇▇▇▇▇▇▇ ▇.▇▇▇▇▇▇▇
Title: CFO
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