Document:

kaushik.htm

  
ANTARES PHARMA, INC.

 

EMPLOYMENT AGREEMENT

 

THIS EMPLOYMENT AGREEMENT (the “Agreement”) is made and entered into this 3rd day of March, 2008 (the “Effective Date”) by and between Antares Pharma, Inc., a Delaware corporation (the “Company”), and Kaushik Dave (the “Executive”).

 

WITNESSETH:

 

WHEREAS, the Company desires to secure for itself the services of the Executive, and the Executive wishes to furnish such services to the Company, on the terms, and subject to the conditions, hereinafter set forth.

 

NOW, THEREFORE, in consideration of the premises and of the mutual promises and covenants contained herein, the Company and the Executive, intending to be legally bound, hereby agree as follows:

 

1. Employment.

 

(a) Term.  The initial term of this Agreement shall begin on the Effective Date and continue until the one-year anniversary thereof, unless sooner terminated by either party as hereinafter provided.  In addition, the term of this Agreement shall automatically renew for periods of one (1) year unless either party gives written notice to the other party at least ninety (90) days prior to the end of the Term or at least ninety (90) days prior to the end of any one (1) year renewal period that the Agreement shall not be further extended.  The period commencing on the Effective Date and ending on the date on which the term of the Executive’s employment under this Agreement terminates is referred to herein as the “Term.”

 

(b) Duties.  During the Term, the Executive shall be employed by the Company as the Vice President of Clinical and Regulatory Affairs of the Company with the duties, responsibilities and authority commensurate therewith, including clinical trials, participation in new product development , FDA, EMEA and related regulatory matters, evaluation of product and company M&A opportunities etc. The Board of Directors of the Company (the “Board”), in consultation with the Chief Executive Officer (the “CEO”), shall review the foregoing title and duties for accomplishment of near term goals established after the expiration of the six (6)-month period following the Effective Date.  Upon such review, such title and duties may be adjusted as the Board deems appropriate.  The Executive shall report to the CEO with dotted line reporting to the head of the Pharma Division and shall perform all duties and accept all responsibilities incident to such position as may be reasonably assigned to him by the CEO.

 

(c) Best Efforts.  During the Term, the Executive shall devote his best efforts and full time and attention to promote the business and affairs of the Company, and may not, without the prior written consent of the Company, operate, participate in the management, operations or control of, or act as an employee, officer, consultant, agent or representative of, any type of business or service (other than as an employee of the Company).  It shall not be deemed a violation of the foregoing for the Executive to (i) act or serve as a director, trustee or committee member of any civic or charitable organization; (ii) manage his personal, financial and legal 

 

 

 

  

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affairs; (iii) act as a consultant to Apollo Biosciences, a private oncology company or (iv) serve as a director of an organization that is not a civic or charitable organization with the consent of the Board, which consent shall not be unreasonably withheld, in all cases so long as such activities (described in clauses (i), (ii) (iii) and (iv)) are permitted under the Company’s code of conduct and employment policies and do not materially interfere with or conflict with his obligations to the Company hereunder, including, without limitation, obligations pursuant to Section 5 below.

 

2. Compensation.

 

(a) Base Salary.  During the Term, the Company shall pay the Executive a base salary (“Base Salary”) at the annual rate of $240,000, which shall be paid in accordance with the Company’s normal payroll practices.  The amount of the Executive’s Base Salary shall be reviewed by the Compensation Committee of the Board (the “Compensation Committee”) after the expiration of the six (6)-month period following the Effective Date, and at the approval of the Compensation Committee, subject to increase (but not decrease) based upon the performance of the Executive and the Company.  After the expiration of the six (6)-month period following the Effective Date, the Executive’s Base Salary shall be subject to review and increase by the Compensation Committee during the Term in accordance with the Company’s normal compensation and performance review policies for senior level executives generally.

 

(b) Bonus.  In addition to the Executive’s Base Salary, the Executive shall be eligible to receive a bonus for each calendar year during the Term based on attainment of certain individual and corporate performance goals and targets (the “Annual Bonus”).  The performance goals and targets shall be determined by the Compensation Committee, in consultation with the CEO.  Once determined, the applicable performance goals and targets shall be communicated to the Executive in writing as soon as reasonably practicable following the Compensation Committee’s determination of the applicable goals and targets but not later than March 1 of each calendar year.  Notwithstanding the preceding two sentences, the performance goals and targets with respect to the Annual Bonus for the first calendar year following the Effective Date shall be determined by the Compensation Committee in consultation with the CEO and the Executive within thirty (30) days of the Effective Date.  The Executive shall be eligible to receive a target Annual Bonus for any calendar year during the Term in the range of 20% to 35% of his Base Salary based on the level of achievement of the applicable performance goals and targets.  The Compensation Committee shall determine in its sole discretion whether and to what extent the applicable performance goals and targets have been achieved and the amount of the Executive’s Annual Bonus, if any.  Any Annual Bonus earned and payable to the Executive hereunder shall be paid on or after January 1 but not later than March 15 of the calendar year following the calendar year for which the Annual Bonus is earned.

 

(c) Signing Bonus.  The Executive shall be entitled to a one –time signing bonus of $10,000 to be paid in a lump sum upon the Executive’s execution of this Agreement and his commencing employment with the Company, subject to withholding and other applicable taxes.

 

(d) Additional Bonus.  The Executive shall also be entitled to an additional bonus in the aggregate amount of $30,000 (the “Additional Bonus”) to be paid in a lump sum, subject to withholding and other applicable taxes as follows: (i) $20,000 upon the Executive’s execution of 

 

 

 

  

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this Agreement and his commencing employment with the Company, and (ii) $10,000 on the first payroll date that occurs after the date that is six (6) months following the Effective Date if the Executive is employed by the Company on such date; provided, however, that the Executive shall be required to repay to the Company the full amount of the Additional Bonus or any portion thereof that has been paid to the Executive (less the amount withheld by the Company for taxes and other withholding requirements at the time of payment) if the Executive ceases to be employed by the Company for any reason within the one (1)-year period following the Effective Date.  Such repayment shall be made within thirty (30) days of the date of the Executive’s termination of employment with the Company.

 

(e) Equity Compensation.

 

(i) Stock Option Grant.  At the meeting of the Compensation Committee next following the Effective Date, pursuant to the Antares Pharma, Inc. 2006 Equity Incentive Plan, as amended from time to time (the “2006 Equity Plan”) (or successor plan), the Executive shall be granted an incentive stock option to purchase 125,000 shares of common stock of the Company, $0.01 par value (the “Stock”) at an exercise price equal to the closing price of the Stock on the date of grant, subject to the terms and conditions of the 2006 Equity Plan (or a successor plan) and the Stock Option Agreement attached here to as Exhibit A.  The option shall vest 33-1/3% annually in 8.33% installments each calendar quarter until the option is fully vested.

 

(ii) Performance Stock Grant.  In addition, at the meeting of the Compensation Committee next following the Effective Date, the Executive shall be granted a performance stock grant pursuant to which the Executive shall be eligible to receive up to 175,000 shares of Stock based upon the attainment of performance criteria as determined by the Compensation Committee; provided that the Executive is employed by, or providing service to, the Company at the time of the applicable event (the “Performance Stock Grant”).  The performance criteria applicable to the Performance Stock Grant shall be established by the Compensation Committee in consultation with the CEO and set forth in the award agreement evidencing such Grant.  The Performance Stock Grant shall be granted under the 2006 Equity Plan (or a successor plan) and be subject in all respects to the 2006 Equity Plan (or a successor plan) and the award agreement evidencing such Grant.

 

(iii) Additional Grants.  During the Term, the Executive shall also be eligible to participate in any long-term equity incentive programs established by the Company for its senior level executives generally, including the 2006 Equity Plan, at levels determined by the Compensation Committee in its sole discretion, commensurate with the Executive’s position.

 

(f) Vacation.  During the Term, the Executive shall be entitled to vacation, holiday and sick leave at levels commensurate with those provided to other executives of the Company, in accordance with the Company’s vacation, holiday and other pay-for-time-not worked policies; provided, however that the Executive shall be entitled to not less than four (4) weeks paid vacation each calendar year, prorated in respect of any period of employment of less than twelve (12) months in a calendar year.  Such paid time off may be carried over from year to year to the extent permitted in accordance with standard Company policy and shall be paid to the extent accrued (and to the extent not used) as of the Executive’s termination of employment.

 

 

 

  

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(g) Employee Benefits.  The Executive shall be entitled to participate in the Company’s health, life insurance, long and short-term disability, dental, retirement, savings, flexible spending accounts and medical programs, if any, pursuant to their respective terms and conditions.  Nothing in this Agreement shall preclude the Company or any parent, subsidiary or affiliate of the Company from terminating or amending any employee benefit plan or program from time to time after the Effective Date.

 

(h) Expense Reimbursement.  During the Term, the Company shall reimburse the Executive, in accordance with the policies and practices of the Company in effect from time to time, for all reasonable and necessary traveling expenses and other disbursements incurred by him for or on behalf of the Company in connection with the performance of his duties hereunder upon presentation by the Executive to the Company of appropriate documentation thereof.

 

(i) Automobile Allowance.  During the Term, the Company shall pay the Executive a monthly car allowance equal to $500 per month, which amount can be applied to a lease of an automobile of the Executive’s choosing or can be paid to the Executive as reimbursement for expenses and depreciation associated with the Executive’s ownership and maintenance of an automobile.  This allowance is subject to review and adjustment by the Compensation Committee from time to time.

 

3. Termination of Employment.

 

(a) Termination for Cause.  The Company may terminate the Executive’s employment hereunder at any time for Cause (as defined below) upon written notice to the Executive (as described below), in which event all payments under this Agreement shall cease, except for any amounts earned, accrued and owing, but not yet paid under Section 2 above (with the exception of automobile-related expenses) and any benefits accrued and due under any applicable benefit plans and programs of the Company.  For purposes of this Agreement, the term “Cause” shall mean any of the following grounds for termination of the Executive’s employment: (i)  the Executive’s knowing dishonesty or fraud committed in connection with the Executive’s employment; (ii) theft, misappropriation or embezzlement by the Executive of the Company’s funds; (iii) the Executive’s conviction of or a plea of guilty or nolo contendere to any felony, a crime involving fraud or misrepresentation, or any other crime (whether or not connected with his employment) the effect of which is likely to adversely affect the Company or its parents, subsidiaries or affiliates; (iv) a material breach by the Executive of any of the provisions or covenants set forth in this Agreement that is not cured within thirty (30) days after the date the Company provides notice of such material breach; provided, however, that the Executive shall have an opportunity to cure such breach only to the extent such breach is curable, as determined by the Board in its sole discretion.

 

(b) Voluntary Resignation.  The Executive may voluntarily terminate his employment upon thirty (30) days advance written notice to the Company.  In such event, after the effective date of such termination, no payments shall be due under this Agreement, except that the Executive shall be entitled to any amounts earned, accrued and owing, but not yet paid under Section 2 above (with the exception of automobile-related expenses) and any benefits accrued and due under any applicable benefit plans and programs of the Company.

 

 

 

  

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(c) Termination Without Cause; Non-Renewal.  The Company may terminate the Executive’s employment with the Company at any time without Cause (as defined in subsection 3(a) above) upon not less than thirty (30) days’ prior written notice to the Executive.  Upon termination of the Executive ’s employment by the Company under this Section 3(c) or the Company elects not to renew the Term under subsection 1(a) above, either before or after a Change in Control (as defined in the 2006 Equity Plan (or a successor plan)), if the Executive executes and does not revoke a written release, in a form acceptable to the Company, in its sole discretion, of any and all claims against the Company and all related parties with respect to all matters arising out of the Executive’s employment by the Company, or the termination thereof (other than claims for any entitlements under the terms of this Agreement or under any plans or programs of the Company under which the Executive has accrued and is due a benefit) (the “Release”), and so long as the Executive continues to comply with the provisions of the Confidentiality and Invention Assignment Agreement (as defined in subsection 5(a) below) and restrictive covenants and representations in Section 5 below, the Executive shall be entitled to receive, in lieu of any other payments due under any severance plan or program for employees or executives, a severance payment equal to six (6) months of the Executive’s Base Salary at the rate in effect immediately prior to the Executive’s termination of employment, less applicable tax withholding, paid in equal monthly installments beginning on the first payroll date after the expiration of the thirty (30)-day period following the date of the Executive’s termination of employment and each payroll date thereafter until fully paid, in accordance with the Company’s regular payroll practices.  The Executive shall also be entitled to any amounts earned, accrued and owing but not yet paid under Section 2 above and any benefits accrued and due under any applicable benefit plans and programs of the Company.

 

(d) Death or Disability.  The Executive’s employment hereunder shall terminate upon the Executive’s death or termination of employment by the Company on account of his Disability (as defined below), subject to the requirements of applicable law.  If the Company terminates the Executive’s employment because of death or Disability, no payments shall be due under this Agreement, except that the Executive (or in the event of the Executive’s death, the Executive’s executor, legal representative, administrator or designated beneficiary, as applicable), shall be entitled to receive any amounts earned, accrued and owing but not yet paid under Section 2 above and any benefits accrued and due under any applicable benefit plans and programs of the Company.  For purposes of this Agreement, the term “Disability” shall mean such physical or mental illness or incapacity of the Executive as shall (i) prevent him from substantially performing his customary services and duties to the Company, and (ii) continue for periods aggregating more than sixty (60) days in any six (6)-month period.  The Company shall determine whether there is a Disability after consultation with a qualified, independent physician.  The Executive shall cooperate with the Company, including making himself reasonably available for examination by physicians at the Company’s request, to determine whether or not he has incurred a Disability.  The Executive’s failure (other than a failure caused by the Disability) to cooperate with the Company in a determination of Disability shall be treated as the Executive’s voluntary resignation from the Company.

 

4. Section 409A.

 

(a) Compliance with Section 409A.  This Agreement shall be interpreted to avoid any penalty sanctions under section 409A of the Internal Revenue Code of 1986, as amended (the 

 

 

 

  

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“Code”).  If any payment or benefit cannot be provided or made at the time specified herein without incurring sanctions under section 409A, then such benefit or payment shall be provided in full at the earliest time thereafter when such sanctions will not be imposed.  For purposes of section 409A of the Code, all payments to be made upon a termination of employment under this Agreement may only be made upon a “separation from service” within the meaning of such term under section 409A of the Code, each payment made under this Agreement shall be treated as a separate payment and the right to a series of installment payments under this Agreement is to be treated as a right to a series of separate payments.  In no event shall the Executive, directly or indirectly, designate the calendar year of payment.  All reimbursements and in-kind benefits provided under this Agreement shall be made or provided in accordance with the requirements of section 409A, including, where applicable, the requirement that (i) any reimbursement is for expenses incurred during the Executive’s lifetime (or during a shorter period of time specified in this Agreement), (ii) the amount of expenses eligible for reimbursement, or in-kind benefits provided, during a calendar year may not affect the expenses eligible for reimbursement, or in-kind benefits to be provided, in any other calendar year, (iii) the reimbursement of an eligible expense will be made on or before the last day of the calendar year following the year in which the expense is incurred, and (iv) the right to reimbursement or in-kind benefits is not subject to liquidation or exchange for another benefit.

 

(b) Payment Delay.  Notwithstanding any provision in this Agreement to the contrary, if at the time of the Executive’s separation from service with the Company, the Company has securities which are publicly-traded on an established securities market and the Executive is a “specified employee” (as defined in section 409A of the Code) and it is necessary to postpone the commencement of any severance payments otherwise payable pursuant to this Agreement as a result of such separation from service to prevent any accelerated or additional tax under section 409A of the Code, then the Company will postpone the commencement of the payment of any such payments or benefits hereunder (without any reduction in such payments or benefits ultimately paid or provided to the Executive) that are not otherwise exempt from section 409A of the Code, until the first payroll date that occurs after the date that is six (6) months following the Executive’s separation from service with the Company.  If any payments are postponed due to such requirements, such postponed amounts will be paid in a lump sum to the Executive on the first payroll date that occurs after the date that is six (6) months following the Executive’s separation from service with the Company.  If the Executive dies during the postponement period prior to the payment of the postponed amount, the amounts withheld on account of section 409A of the Code shall be paid to the personal representative of the Executive’s estate within sixty (60) days after the date of the Executive’s death.

 

5. Restrictive Covenants and Representations.

 

(a) Confidential Information.  As a condition to the commencement of his employment hereunder, the Executive agrees to enter into the Company’s standard Confidential Information and Invention Assignment Agreement, attached hereto as Exhibit B (the “Confidentiality and Invention Assignment Agreement”), prior to commencing employment hereunder, all of which are hereby incorporated into this Agreement by reference.  The Executive hereby agrees that, during the Term and thereafter, the Executive shall hold in strict confidence any proprietary or Confidential Information (as defined below) related to the Company and its parents, subsidiaries and affiliates, except that he may disclose such information pursuant to law, 

 

 

  

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court order, regulation or similar order.  For purposes of this Agreement, the term “Confidential Information” shall mean all information of the Company or any of its parents, subsidiaries and affiliates (in whatever form) which is not generally known to the public, including without limitation any inventions, processes, methods of distribution, customer lists or trade secrets.  The Executive hereby agrees that, upon the termination of this Agreement, he shall not take, without the prior written consent of the Company, any document (in whatever form) of the Company or its parents, subsidiaries or affiliates, which is of a confidential nature relating to the Company or its parents, subsidiaries or affiliates, or, without limitation, relating to its or their methods of distribution, or any description of any formulas or secret processes and will return any such information (in whatever form) then in his possession.

 

(b) Non-Competition.  The Executive hereby acknowledges that during his employment with the Company, the Executive will become familiar with trade secrets and other Confidential Information concerning the Company, its subsidiaries and their respective predecessors, and that the Executive’s services will be of special, unique and extraordinary value to the Company.  Accordingly, the Executive hereby agrees that at any time during the Term, and for a period of six months after the Executive’s date of termination of employment for any reason (such six-month period referred to as the “Restriction Period”), the Executive will not, directly or indirectly, own, manage, control, participate in, consult with, render services for, or in any manner engage in any business involving or related to (directly or indirectly) the research, development, marketing and/or sale or other delivery of transdermal gel products, oral disintegrating tablets and/or needle-free injection devices, within any geographical area in which, as of the date of the Executive’s termination of employment, the Company or its subsidiaries engage in business or demonstrably plan to engage in businesses.

 

(c) Non-Solicitation.  The Executive hereby agrees that during the Term and the Restriction Period, (i) the Executive will not, directly or indirectly through another entity, induce or attempt to induce any employee of the Company or its subsidiaries to leave the employ of the Company or its subsidiaries, or in any way interfere with the relationship between the Company or its subsidiaries and any employee thereof or otherwise employ or receive the services of an individual who was an employee of the Company or its subsidiaries at any time during such Non-Solicitation Period, except any such individual whose employment has been terminated by the Company and (ii) the Executive will not induce or attempt to induce any customer, supplier, client, broker, licensee or other business relation of the Company or its subsidiaries to cease doing business with the Company or its subsidiaries.

 

(d) Return of Property.  Upon termination of the Executive’s employment with the Company for any reason whatsoever, voluntarily or involuntarily (and in all events within five (5) days of the Executive’s date of termination), and at any earlier time the Company requests, the Executive will deliver to the person designated by the Company all originals and copies of all documents and property of the Company in the Executive’s possession, under the Executive’s control or to which the Executive may have access, including but not limited to, any office, computing or communications equipment (e.g., laptop computer, facsimile machine, printer, cellular phone, etc.) that he has had or has been using, and any business or business-related files that he has had in his possession.  The Executive will not reproduce or appropriate for the Executive’s own use, or for the use of others, any property, Confidential Information or 

 

 

 

  

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Company inventions, and shall remove from any personal computing or communications equipment all information relating to the Company.

 

(e) Non-Disparagement.  The Executive agrees that the Executive will not disparage the Company, its subsidiaries and parents, and their respective Executives, directors, investors, employees, and agents, and its and their respective successors and assigns, heirs, executors, and administrators, or make any public statement reflecting negatively on the Company, its subsidiaries and parents, and their respective officers, directors, investors, employees, and agents, and its and their respective successors and assigns, heirs, executors, and administrators, to third parties, including, but not limited to, any matters relating to the operation or management of the Company, irrespective of the truthfulness or falsity of such statement, except as may otherwise be required by applicable law or compelled by process of law.  The Company shall not make any disparaging or negative remarks, either oral or in writing, regarding the Executive.

 

(f) Cooperation.  During the Term and thereafter, the Executive shall cooperate with the Company and its parents, subsidiaries and affiliates, upon the Company’s reasonable request, with respect to any internal investigation or administrative, regulatory or judicial proceeding involving matters within the scope of the Executive’s duties and responsibilities to the Company during the Term (including, without limitation, the Executive being available to the Company upon reasonable notice for interviews and factual investigations, appearing at the Company’s reasonable request to give testimony without requiring service of a subpoena or other legal process, and turning over to the Company all relevant Company documents which are or may come into the Executive’s possession during the Term); provided, however, that any such request by the Company shall not be unduly burdensome or interfere with the Executive’s personal schedule or ability to engage in gainful employment.  In the event the Company requires the Executive’s cooperation in accordance with this subsection 5(f), the Company shall reimburse the Executive for reasonable out-of-pocket expenses (including travel, lodging and meals and reasonable attorneys’ fees) incurred by the Executive in connection with such cooperation, subject to reasonable documentation.

 

(g) Executive Representations.

 

(i) The Executive represents and warrants to the Company that there are no restrictions, agreements or understandings whatsoever to which the Executive is a party which would prevent or make unlawful the Executive’s execution of this Agreement or the Executive’s employment hereunder, which is or would be inconsistent or in conflict with this Agreement or the Executive’s employment hereunder, or would prevent, limit or impair in any way the performance by the Executive of the obligations hereunder.  In addition, the Executive has disclosed to the Company all restraints, confidentiality commitments, and other employment restrictions that he has with any other employer, person or entity.  The Executive covenants that in connection with his provision of services to the Company, the Executive shall not breach any obligation (legal, statutory, contractual or otherwise) to any former employer or other person, including, but not limited to, obligations relating to confidentiality and proprietary rights.

 

(ii) Upon and after the Executive’s termination or cessation of employment with the Company and until such time as no obligations of the Executive to the Company hereunder exist, the Executive shall (A) provide a complete copy of this Agreement to any 

 

 

  

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person, entity or association engaged in a competing business with whom or which the Executive proposes to be employed, affiliated, engaged, associated or to establish any business or remunerative relationship prior to the commencement of any such relationship and (B) shall notify the Company of the name and address of any such person, entity or association prior to the commencement of such relationship.

 

6. Legal and Equitable Remedies.  Because the Executive’s services are personal and unique and the Executive has had and will continue to have access to and has become and will continue to become acquainted with the proprietary information of the Company, and because any breach by the Executive of any of the restrictive covenants contained in Section 5 would result in irreparable injury and damage for which money damages would not provide an adequate remedy, the Company shall have the right to enforce Section 5 and any of its provisions by injunction, specific performance or other equitable relief, without bond and without prejudice to any other rights and remedies that the Company may have for a breach, or threatened breach, of the restrictive covenants set forth in Section 5.  The Executive agrees that in any action in which the Company seeks injunction, specific performance or other equitable relief, the Executive will not assert or contend that any of the provisions of Section 5 are unreasonable or otherwise unenforceable.  The Executive irrevocably and unconditionally (a) agrees that any legal proceeding arising out of this paragraph may be brought in the United States District Court for the District of New Jersey, or if such court does not have jurisdiction or will not accept jurisdiction, in any court of general jurisdiction in Mercer County, New Jersey, (b) consents to the non-exclusive jurisdiction of such court in any such proceeding, and (c) waives any objection to the laying of venue of any such proceeding in any such court.  The Executive also irrevocably and unconditionally consents to the service of any process, pleadings, notices or other papers.

 

7. Arbitration; Expenses.  In the event of any dispute under the provisions of this Agreement, other than a dispute in which the primary relief sought is an equitable remedy such as an injunction, the parties shall be required to have the dispute, controversy or claim settled by arbitration in Trenton, New Jersey in accordance with the National Rules for the Resolution of Employment Disputes then in effect of the American Arbitration Association, before an arbitrator agreed to by both parties.  If the parties cannot agree upon the choice of arbitrator, the Company and the Executive will each choose an arbitrator.  The two arbitrators will then select a third arbitrator who will serve as the actual arbitrator for the dispute, controversy or claim.  Any award entered by the arbitrators shall be final, binding and nonappealable and judgment may be entered thereon by either party in accordance with applicable law in any court of competent jurisdiction.  This arbitration provision shall be specifically enforceable.  The arbitrators shall have no authority to modify any provision of this Agreement or to award a remedy for a dispute involving this Agreement other than a benefit specifically provided under or by virtue of the Agreement.  Each party shall be responsible for its own expenses, unless the Executive shall prevail in an arbitration proceeding as to any material issue, in which case the Company shall reimburse the Executive for all reasonable costs, expenses and fees relating to the conduct of the arbitration, and shall share the fees of the American Arbitration Association.  The Company shall pay the reasonable costs, expenses and fees relating to the conduct of the arbitration to the Executive within thirty (30) days after the date on which it is finally determined that the Executive has prevailed on any material issue which is the subject of such arbitration.

 

 

  

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8. Survivability.  The respective rights and obligations of the parties under this Agreement shall survive any termination of the Executive’s employment to the extent necessary to the intended preservation of such rights and obligations.

 

9. Assignment.  All of the terms and provisions of this Agreement shall be binding upon and inure to the benefit of and be enforceable by the respective heirs, executors, administrators, legal representatives, successors and assigns of the parties hereto, except that the duties and responsibilities of the Executive under this Agreement are of a personal nature and shall not be assignable or delegable in whole or in part by the Executive.  The Company shall require any successor (whether direct or indirect, by purchase, merger, consolidation, reorganization or otherwise) to all or substantially all of the business or assets of the Company, within 15 days of such succession, expressly to assume and agree to perform this Agreement in the same manner and to the same extent as the Company would be required to perform if no such succession had taken place and the Executive acknowledges that in such event the obligations of the Executive hereunder, including but not limited to those under Section 5, will continue to apply in favor of the successor.

 

10. Entire Agreement; Amendment; Waiver.  This Agreement sets forth the entire understanding between the parties hereto with respect to the subject matter hereof and cannot be changed, modified, extended or terminated except upon written amendment approved by the Board and executed on its behalf by a duly authorized officer (other than the Executive) and by the Executive.  This Agreement supersedes the provisions of any employment or other agreement between the Executive and the Company that relate to any matter that is also the subject of this Agreement.

 

11. Remedies Cumulative; No Waiver.  No remedy conferred upon a party by this Agreement is intended to be exclusive of any other remedy, and each and every such remedy shall be cumulative and shall be in addition to any other remedy given under this Agreement or now or hereafter existing at law or in equity.  No delay or omission by a party in exercising any right, remedy or power under this Agreement or existing at law or in equity shall be construed as a waiver thereof, and any such right, remedy or power may be exercised by such party from time to time and as often as may be deemed expedient or necessary by such party in its sole discretion.

 

12. Beneficiaries/References.  The Executive shall be entitled, to the extent permitted under any applicable law, to select and change a beneficiary or beneficiaries to receive any compensation or benefit payable under this Agreement following the Executive’s death by giving the Employer written notice thereof.  In the event of the Executive’s death or a judicial determination of the Executive’s incompetence, reference in this Agreement to the Executive shall be deemed, where appropriate, to refer to the Executive’s beneficiary, estate or other legal representative.

 

13. Withholding.  All payments under this Agreement shall be made subject to applicable tax withholding, and the Company shall withhold from any payments under this Agreement all federal, state and local taxes as the Company is required to withhold pursuant to any law or governmental rule or regulation.  The Executive shall bear all expense of, and be solely 

 

 

  

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responsible for, all federal, state and local taxes due with respect to any payment received under this Agreement.

 

14. Indemnification.  The Company agrees to indemnify and hold the Executive harmless to the fullest extent permitted by the laws of the State of Delaware and under the bylaws of the Company, both as in effect at the time of the subject act or omission.  In connection therewith, the Executive shall be entitled to the protection of any insurance policies which the Company elects to maintain generally for the benefit of the Company’s directors and officers, against all costs, charges and expenses whatsoever incurred or sustained by the Executive in connection with any action, suit or proceeding to which the Executive may be made a party by reason of his being or having been a director, officer or employee of the Company.  This provision shall survive any termination of the Executive’s employment hereunder.

 

15. Notices.  Any notice or communication required or permitted under the terms of this Agreement shall be in writing and shall be delivered personally, or sent by registered or certified mail, return receipt requested, postage prepaid, or sent by nationally recognized overnight carrier, postage prepaid, or sent by facsimile transmission to the Company at the Company’s principal office and facsimile number or to the Executive at the address and facsimile number, if any, appearing on the books and records of the Company.  Such notice or communication shall be deemed given (a) when delivered if personally delivered; (b) five (5) mailing days after having been placed in the mail, if delivered by registered or certified mail; (c) the business day after having been placed with a nationally recognized overnight carrier, if delivered by nationally recognized overnight carrier, and (d) the business day after transmittal when transmitted with electronic confirmation of receipt, if transmitted by facsimile.  Any party may change the address or facsimile number to which notices or communications are to be sent to it by giving notice of such change in the manner herein provided for giving notice.  Until changed by notice, the following shall be the address and facsimile number to which notices shall be sent:

 

If to the Company, to:

 

Antares Pharma, Inc.

Princeton Crossroads Corporate Center

250 Phillips Boulevard, Suite 290

Ewing, New Jersey 08618

Attn: ­­­­­­Chief Executive Officer

(609) 359-3015 (facsimile)

With a copy to:

Morgan, Lewis and Bockius LLP

1701 Market Street

Philadelphia, PA 19103

Attn: Amy Pocino Kelly, Esq.

(877) 432-9652 (facsimile)

If to the Executive, to the most recent address on file with the Company or to such other names or addresses as the Company or the Executive, as the case may be, shall designate 

 

 

 

  

11

  

 

by notice to each other person entitled to receive notices in the manner specified in this Section 15.

 

16. Governing Law.  This Agreement will be governed by and construed in accordance with the laws of the State of New Jersey, without regard to conflict of law principles.

 

17. Counterparts.  This Agreement may be executed in counterparts, each of which shall be deemed to be an original, but all such counterparts shall together constitute one and the same instrument.

 

18. Headings; Gender.  The headings of sections and subsections herein are included solely for convenience of reference and shall not control the meaning or interpretation of any of the provisions of this Agreement.

 

19. Severability.  If any provision of this Agreement or application thereof to anyone or under any circumstances is adjudicated to be invalid or unenforceable in any jurisdiction, such invalidity or unenforceability shall not affect any other provision or application of this Agreement which can be given effect without the invalid or unenforceable provision or application and shall not invalidate or render unenforceable such provision or application in any other jurisdiction.  If any provision is held void, invalid or unenforceable with respect to particular circumstances, it shall nevertheless remain in full force and effect in all other circumstances.

 

[Signature Page Follows]

 

 

 

  

12

  

 

 

IN WITNESS WHEREOF, the parties have executed this Agreement as of the day and year first above written.

 

 

 

 

	 	 ANTARES PHARMA, INC.	 
	 	 	 	 
	 	
 By: 

	/s/ Jack Stover	 
	 	 Name:	Jack Stover	 
	 	 Its:  	President	 
	 	 	 	 

 

 

 

	 	 EXECUTIVE
	 	 
	 	 
	 	 /s/ Kaushik Dave
	 	 Kaushik Dave
	 	 
	 	 

 

 

  

1

  

 

 

EXHIBIT A

 

ANTARES PHARMA, INC.

2006 EQUITY INCENTIVE PLAN

 INCENTIVE STOCK OPTION AWARD AGREEMENT

 

 

 

	 Summary of Option Award	 
	 	 
	      Optionee	 Kaushik Dave
	      Date of Option Award	 January 28, 2008
	      Number of Shares Granted	 175,000
	      Exercise Price	 $__.___ per share
	      Term/Expiration Date	 Ten Years from
	 	 Date of Option Award Agreement
	      Vesting Schedule	 8.333% per Quarter
	 	 

 

 

This Employee Stock Option Award Agreement (“the Agreement”) is made and entered into effective as of January 28, 2008 by and between Antares Pharma, Inc., a Delaware corporation (the “Company”), and Dave Kaushik (“Optionee”).

WHEREAS, the Company has adopted the Antares Pharma, Inc. 2006 Equity Incentive Plan (the “Plan”), which permits issuance of stock options among other things for the purchase of shares of the Common Stock, $.01 par value, of the Company (the “Common Stock”), and the Company wishes to grant this stock option to Optionee pursuant to the Plan. (Capitalized terms used herein but not otherwise defined herein have the meanings assigned to them in the Plan.)

 

NOW, THEREFORE, in consideration of the premises and the mutual covenants contained in this Agreement, and for other good and valuable consideration, the adequacy and receipt of which are hereby acknowledged, the Company and Optionee do hereby agree as follows:

Section 1. Grant of Option.

The Company hereby grants Optionee, as of the date of this Agreement, the right and option (hereinafter called the “Option”) to purchase all or any part of an aggregate of 175,000 shares of the Common Stock at the price of $__________ per share and subject to all of the terms and conditions of this Agreement and of the Plan. It is understood and agreed that such price is not less than 100% of the Fair Market Value of each such share on the date of this Agreement.

 

 

  

1

  

 

Section 2. Duration and Exercisabilily.

(a) The Option may not be exercised by Optionee except as set forth below, and the Option shall in all events terminate ten years from the date hereof. Subject to the other terms and conditions set forth herein, the Option shall vest and may be exercised by the Optionee in cumulative installments as follows:

 

 

 

 

	 	 Cumulative percentage
	 On or after each of	 of shares as to which
	 the following dates:	 the Option is exercisable
	 	 
	 April 28, 2008, and each	 8.333% per quarter
	 consecutive ten Quarters	 
	 July 28, 2010	 8.377%
	 	 

 

Optionee shall advance on the vesting schedule only if employed by the Company on the applicable vesting date.

(b) During the lifetime of Optionee, the Option shall be exercisable only by Optionee. The Option shall not be assignable or transferable by Optionee, otherwise than by will or the laws of descent or distribution.

(c) Notwithstanding the vesting provisions herein, the Option may be exercised as to 100% of the shares of Common Stock for which the Option was granted on the date of a “change of control”, as hereinafter defined, if the Optionee is employed by the Company on the date of the change of control. A “change of control” shall mean any of the following:

 

	
(i)

	
A sale of all or substantially all of the assets of the Company;

 

	
(ii)

	
A reorganization of the Company wherein the holders of Common Stock receive stock in another company, a merger of the Company with another company wherein there is an 80% or greater change in the ownership of the Common Stock as a result of such merger, or any other transaction in which the Company (other than as the parent corporation) is consolidated for federal income tax purposes or is eligible to be consolidated for federal income tax purposes with another corporation;

 

	
(iii)

	
In the event that the Common stock is traded on an established securities market: a public announcement that any person has acquired or has the right to acquire beneficial ownership of more than 50% of the then outstanding Common Stock and for this purpose the terms “person” and “beneficial ownership” shall have the meanings provided in Section 13(d) of the Securities and Exchange Commission; or the commencement of or public announcement of an intention to make a tender offer for more than 50% of the then outstanding Common Stock; and

 

 

 

  

2

  

 

	
(iv)

	
The Board of Directors of the Company, in its sole and absolute discretion, determines that there has been a sufficient change in the share ownership of the Company to constitute a change of the effective ownership or control of the Company.

 

 

Section 3. Effect of Termination of Employment.

(a) In the event that Optionee shall cease to be employed by the Company or its Affiliates for any reason other than Optionee’s gross and willful misconduct or Optionee’s death or disability, Optionee shall have the right to exercise the Option at any time within three months after such termination of employment to the extent of the full number of shares Optionee was entitled to purchase under the Option on the date of termination, subject to the condition that the Option shall not be exercisable after the expiration of its term.

(b) In the event that Optionee shall cease to be employed by the Company or its Affiliates by reason of Optionee’s gross and willful misconduct during the course of employment (as reasonably determined by the Company), the Option shall terminate as of the date of the misconduct.

(c) If Optionee shall die while in the employ of the Company or its Affiliates or within three months after termination of employment for any reason other than gross and willful misconduct, or if Optionee shall be come disabled within the meaning of Section 22(e)(3) of the Code while in the employ of the Company or its Affiliates and Optionee shall not have fully exercised the Option, the Option may be exercised at any time within twelve months after Optionee’s death or disability by the legal representative or, if applicable, guardian of Optionee, or by any person to whom the Option is transferred by will or the applicable laws of descent or distribution, to the extent of the full number of shares Optionee was entitled to purchase under the Option on the date of death (or termination of employment, if earlier) or disability and subject to the condition that the Option shall not be exercisable after the expiration of its term.

Section 4. Manner of Exercise.

(a) The Option may only be exercised by Optionee or other proper party by delivery, within the Option period, of written notice to the Company at its principal office. The notice shall state the number of shares as to which the Option is being exercised. The Company will verify the appropriateness of the election and determine the amounts of compensation and related withholding tax.

(b) The exercise amount and applicable taxes must be tendered by the Optionee or other proper party prior to the issuance of shares covered by the notice of exercise. Payment shall be made to the Company in cash (including bank check, certified check, personal check, or money order), or, at the discretion of the Company and as specified by the Company, (i) by delivering certificates for Common Stock already owned by the Optionee or other proper party having a 

 

 

  

3

  

 

 

 

Fair Market Value as of the date of exercise equal to the full purchase price of the shares as to which the Option is exercised, (ii) by delivery (including facsimile) to the Company or its designated agent of an executed irrevocable option exercise form together with irrevocable instructions to a broker-dealer to sell a sufficient portion of the shares as to which the Option is exercised and deliver the sale proceeds directly to the Company to pay for the exercise price, (iii) a combination of the foregoing methods of payment, or (iv) such other consideration and method of payment for the issuance of shares as may be permitted under applicable laws and allowed by the Company.

(c) The exercise of the Option is contingent upon receipt from Optionee (or other proper person exercising the Option) of a representation that, at the time of such exercise, it is Optionee’s intention to acquire the shares being purchased for investment and not with a view to the distribution or sale thereof within the meaning of the Securities Act of 1933, as amended (the “Securities Act”); provided, however, that the receipt of such representation shall not be required upon exercise of the Option in the event that, at the time of such exercise, the shares subject to the Option shall have been properly registered under the Securities Act and all applicable state securities laws. Such representation shall be in writing and in such form as the Company may reasonably request. The certificate representing the shares so issued for investment shall be imprinted with an appropriate legend setting forth all applicable restrictions on the transferability of such shares.

Section 5. Miscellaneous.

(a) The Option is issued pursuant to the Plan and is subject to all of the terms and conditions thereof. Optionee acknowledges receipt of a copy of the Plan and represents to the Company that he or she is familiar with the provisions thereof.

(b) Nothing in this Agreement shall confer on Optionee any right to continue in the employ of the Company or any Affiliate of the Company or affect, in any way, the right of the Company or any Affiliate of the Company to terminate Optionee’s employment at any time.

(c) Until Optionee or any other proper party has been issued the shares as to which this Option has been exercised, he or she shall possess no rights as a shareholder with respect to such shares.

(d) The exercise of all or any part of the Option shall only be effective at such time as the sale of the Common Stock pursuant to such exercise will not violate any federal or state securities laws.

 (e) If there shall be any change in the Common Stock subject to the Option, through any dividend or other distribution (whether in the form of cash, shares of Common Stock, other securities or other property), recapitalization, stock split, reverse stock split, reorganization, merger, consolidation, split-up, spin-off, combination, repurchase or exchange of shares of Common Stock or other securities of the Company, issuance of warrants or other rights to purchase shares of Common Stock or other securities of the Company or other similar corporate transaction or event, then, in order to prevent dilution or enlargement of the option rights granted 

 

 

 

  

4

  

 

hereunder, the Company shall make appropriate adjustments in accordance with the Plan in the number and type of shares of Common Stock (or other securities or other property) subject to the Option and the exercise price with respect to the Option; provided, however, that the number of shares of Common Stock subject to the Option shall always be a whole number.

(f) The Company shall at all times during the term of the Option reserve and keep available such number of shares of the Common Stock as will be sufficient to satisfy the requirements of this Agreement.

(g) If Optionee shall dispose of any of the shares of Common Stock acquired upon exercise of the Option within two years from the date hereof or within one year after exercise of the Option, then, in order to provide the Company with the opportunity to claim the benefit of any income tax deduction which may be available to it under the circumstances, Optionee shall promptly notify the Company of the dates of acquisition and disposition of such shares, the number of shares so disposed of, and the consideration, if any, received for such shares. In order to comply with all applicable federal and state income tax laws and regulations, the Company may take such action as it deems appropriate to ensure that, if necessary, all applicable federal or state payroll, withholding, income or other taxes are withheld or collected from Optionee.

IN WITNESS WHEREOF, this Agreement is hereby executed effective as of the date first set forth above.

 

	 	Antares Pharma, Inc.	 
	 	 	 	 
	
 

	
By: 

	 	 
	 	 	Robert F. Apple 	 
	 	Title:	Senior Vice President & CFO	 
	 	 	 	 

 

 

 

  

5

  

EXHIBIT B

CORP 305.1                                  Proprietary Information and Invention Assignment Agreement

As an employee of Antares Pharma, Inc. (the "Company"), I acknowledge that the Company operates in a competitive environment and that it enhances its opportunities to succeed by establishing policies designed to identify and secure the Company's Intellectual Property and Confidential Information. This Agreement is designed to make clear that:

	
  

	
i)

	
I will maintain the confidentiality of the Company's Proprietary Information and use such Proprietary Information for the exclusive benefit of the Company;

	
  

	
ii)

	
inventions that I create will be owned by the Company; and

	
  

	
iii)

	
my activities separate from the Company will not conflict with the Company's development of its proprietary rights.

In consideration of my employment and/or the continuation of my employment by the Company, I hereby agree as follows:

1.           Provisions Related to Trade Secrets

	
  

	
(a)

	
I acknowledge that the Company possesses and will continue to develop and acquire valuable Proprietary Information (as defined below), including information that I may develop or discover as a result of my employment with the Company.

	
  

	
(b)

	
As used in this Agreement, "Proprietary Information" means any information (including any compilation, device, method, technique or process) that derives independent economic value, actual or potential, from not being generally known to the public or other persons who can obtain economic value from its disclosure or use, and includes information of the Company, its customers, suppliers, joint ventures, licensors, licensees, distributors and other persons and entities with whom the Company does business.

	
  

	
(c)

	
I will not disclose or use at any time, either during or after my employment with the Company, any Proprietary Information except for the exclusive benefit of the Company as required by my duties for the Company, or as the Company expressly may consent to in writing. I will cooperate with the Company to implement reasonable measures to maintain the secrecy of, and will use my best efforts to prevent the unauthorized disclosure, use or reproduction of, all Proprietary Information.

	
  

	
(d)

	
Upon leaving employment with the Company for any reason, I immediately will deliver to the Company any property, records, documents and other tangible materials (including all copies) in my possession or under my control, including data incorporated in word processing, computer and other data storage media, containing or disclosing Proprietary Information.

 

  

1

  

 

 

2.           Ownership of Inventions

	
  

	
(a)

	
I agree to communicate to the Company as promptly and fully as practicable all Inventions (as defined below) conceived or reduced to practice by me (alone or jointly by others) at any time during my employment with the Company. I hereby assign to the Company and/or its nominees all my right, title and interest in such Inventions, and all my right, title and interest in any patents, copyrights, patent applications or copyright applications based thereon. I will give the Company and/or its nominees (at no expense to me) any assistance it reasonably requires to perfect, protect and use its rights to all such Inventions anywhere in the world.

	
  

	
(b)

	
As used in this Agreement, the term "Inventions" includes, but is not limited to, all discoveries, improvements, processes, developments, designs, know-how, data, computer programs and formulae, whether patentable or unpatentable or protectable by copyright or other intellectual property law.

	
  

	
(c)

	
Any provision in this Agreement requiring me to assign my rights in any Invention does not apply to an Invention for which no equipment, supplies, facility or trade secret information of the Company was used, and which was developed entirely on my own time, and which:

	
  

	
(i)

	
does not relate directly to the Company's business or to the Company's anticipated research or development, or

	
  

	
(ii)

	
does not result from any work performed by me for the Company.

 

	
  

	
(d)

	
I hereby designate and appoint the Company and each of its duly authorized officers as my agent and attorney-in-fact to act for and in my behalf to execute and file any document, and to do all other lawfully permitted acts to further the prosecution, issuance and enforcement of patents, copyrights and other proprietary rights with the same force and effect as if executed and delivered by

3.           Conflicts With Other Activities

I understand that my employment with the Company and my compliance with this Agreement do not and will not breach any agreement to keep in confidence any information acquired by me prior to or outside of my employment with the Company. I have not brought and will not bring with me to the Company for use in the performance of my duties at the Company any materials, documents or information of a former employer or any third party that are not generally available

 

 

  

2

  

to the public unless I have obtained express written authorization from the owner for their possession and use by or for the Company. I have not entered into and will not enter into any agreement, either oral or written, in conflict with this Agreement.

4.           Miscellaneous

(a)           My obligations under this Agreement may not be modified or terminated, in whole or in any part, except in a writing signed by the Company. Any waiver by the Company of a breach of any provision of this Agreement will not operate or be construed as a waiver of any subsequent breach.

(b)           Each provision of this Agreement will be treated as a separate and independent clause, and the unenforceability of anyone provision will in no way impair the enforceability of any other provision. If any provision is held to be unenforceable, such provision will be construed by the appropriate judicial body by limiting or reducing it to the minimum extent necessary to make it legally enforceable.

(c)           My obligations under this Agreement will survive the termination of my employment, regardless of the manner of such termination. This Agreement will inure to the benefit of and will be binding upon the successors and assigns of the Company.

(d)           I understand that the provisions of this Agreement are a material condition to my employment and/or continued employment with the Company. I also understand that this Agreement is not an employment contract, and nothing in this Agreement creates any right to my continuous employment by the Company, or to my employment for any particular term.

(e)           Any breach of this Agreement likely will cause irreparable harm to the Company for which money damages could not reasonably or adequately compensate the Company. Accordingly, I agree that the Company will be entitled to injunctive

  

3

  

SIGNING THIS AGREEMENT CREATES IMPORTANT OBLIGATIONS OF TRUST AND AFFECTS THE EMPLOYEE'S RIGHTS TO INVENTIONS THE EMPLOYEE MAY MAKE DURING HIS/HER EMPLOYMENT.

 

	 	 	 	 	 
	
 

	 	 	
 

	 
	
Employee Signature

	 	 	
Employee Name (printed) 

	 
	
 

	 	 	 	 
	Date:   	 	 	 	 
	 	 	 	 	 
	ACCEPTED AND AGREED TO:	 	 	 	 
	 	 	 	 	 
	ANTARES PHARMA, INC.	 	 	 	 
	 	 	 	 	 
	By:                                                       	 	 	 	 
	        Authorized Signer	 	 	 	 

 

4corplease.htm

  

 

	 	 	 
	 	 	 
	 	 	 

 

PRINCETON SOUTH CORPORATE CENTER OFFICE LEASE

Between

PRINCETON SOUTH INVESTORS, LLC

(a Delaware limited liability company)

as Landlord

-and-

Antares Pharma, Inc.

(a Delaware corporation)

as Tenant

 

 

	 	 	 

 

Dated:  February 3, 2012

Premises:

8,065 Rentable Square Feet

Third Floor – Suite 300

Princeton South Corporate Center Condominium – Unit 1

100 Charles Ewing Boulevard

Ewing, New Jersey  08628

 

	 	 	 
	 	 	 
	 	 	 

 

© 2011 Rubenstein Partners, L.P. All Rights Reserved.

PH2 1042828v6 01/26/12

PH2 1042828v9 01/30/12

  

  

  

TABLE OF CONTENTS

 

	Paragraph 	 	 	
 Page

	 	 	 	 
	 1.   	 	 Premises; Use	 1
	 	 	 1.1.     Letting and Premises; Use	 1
	 	 	 1.2.     Property	 1
	 	 	 1.3.     Common Facilities	 1
	 	 	 1.4.     Use of Parking Facilities	 2
	 	 	
 1.5.     Rentable Square Feet

	 3
	 	 	 	 
	 2.	 	 Term; Commencement	 3
	 	 	
 2.1.     Duration

	 3
	 	 	 2.2.     Substantial Completion	 3
	 	 	 2.3.     Confirmation	 4
	 	 	 2.4.     Acceptance of Work	 4
	 	 	 	 
	 2.5	 	 Early Access	 4
	 	 	 	 
	 3.	 	 Minimum Rent; Increases in Minimum Rent; Security Deposit	 5
	 	 	 3.1.     Amount and Payment	 5
	 	 	 3.2.     Partial Month	 5
	 	 	 3.3.     Address For Payment	 5
	 	 	 3.4.     Non-Waiver of Rights	 6
	 	 	 3.5.     Additional Sums Due; No Set-Off	 6
	 	 	 3.6.     Personal Property and Other Taxes	 7
	 	 	 3.7.     Security Deposit	 7
	 	 	 	 
	 4.	 	 Increases in Taxes and Operating Expenses	 8
	 	 	 4.1.     Definitions	 8
	 	 	 4.2.     Tenant's Share of Taxes and Tenant’s Share of Operating Expenses	 12
	 	 	 4.3.     Disputes; Audit	 13
	 	 	 4.5.     Survival	 15
	 	 	 	 
	 5.	 	 Services	 15
	 	 	 5.1.     HVAC and Electricity	 15
	 	 	 5.2.     Water and Sewer	 17
	 	 	 5.3.     Elevator; Access	 17
	 	 	 5.4.     Janitorial	 18
	 	 	 5.5.     Security	 18
	 	 	 5.6.     Repairs	 18
	 	 	 5.7.     System Canges	 19
	 	 	 5.8.     Directory	 19
	 	 	 5.9.     Limitation Regarding Services	 19
	 	 	 	 
	 6.	 	 Care of Premises	 20
	 	 	 6.1.     Insurance and Governmental Requirements	 20
	 	 	 6.2.     Access	 20

 

 

  

  -i-

  

  

  

  

 

 

 

	 	 	 6.3.     Condition	 21
	 	 	 6.4.     Surrender	 21
	 	 	 6.5.     Signs	 21
	 	 	 6.6.     Care; Insurance	 22
	 	 	 6.7.     Alterations; Additions	 22
	 	 	
 6.8.     Mechanics' Liens

	 23
	 	 	 6.9.     Vending Machines	 24
	 	 	 6.10.   Rules and Regulations	 24
	 	 	
 6.11.   Environmental Compliance

	 24
	 	 	 	 
	 7.	 	
Subletting and Assigning

	 27
	 	 	 7.1.     General Restrictions	 27
	 	 	 7.2.     Definitions	 28
	 	 	 7.3.     Procedure for Approval of Transfer	 28
	 	 	 7.4.     Recapture	 29
	 	 	 7.5.     Conditions	 29
	 	 	 7.6.     Special Conditions for Transfers to Affiliates of Tenant	 29
	 	 	 7.7.     No Release	 30
	 	 	 	 
	 8.	 	 Fire or Other Casualty	 30
	 	 	 	 
	 9.	 	 Regarding Insurance and Liability	 31
	 	 	 9.1.     Damage in General	 31
	 	 	 9.2.     Indemnity	 31
	 	 	 9.3.     Tenant's Insurance	 33
	 	 	 9.4.     Release and Waiver of Subrogation	 34
	 	 	 9.5.     Limitation on Personal Liability	 34
	 	 	 9.6.     Successors in Interest to Landlord, Mortgagees	 34
	 	 	 9.7.     Survival	 36
	 	 	 	 
	 10.	 	 Eminent Domain	 36
	 	 	 	 
	 11.	 	 Insolvency	 36
	 	 	 	 
	 12.	 	
Default

	 37
	 	 	 12.1.     Events of Default by Tenant	 37
	 	 	 12.2.     Remedies	 37
	 	 	 12.3.     No Duty to Relet	 39
	 	 	 12.4.     Bankruptcy	 39
	 	 	 12.5.     Waiver of Defects	 39
	 	 	 12.6.     Non-Waiver by Landlord	 40
	 	 	 12.7.     Partial Payment	 40
	 	 	 12.8.     Overdue Payments	 40
	 	 	 12.9.     Security Interest	 40
	 	 	 12.10.   Cumulative Remedies	 41
	 	 	 	 
	 12.11	 	 WAIVER OF JURY TRIAL	 41

 

 

 

  

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	 	 	 12.12.  Landlord Default	 41
	 	 	 	 
	 13.	 	 Subordination	 42
	 	 	 13.1.     General	 42
	 	 	 13.2.     Rights of Mortgagees and Ground Lessors	 43
	 	 	
 13.3.     Modifications

	 43
	 	 	 	 
	 14.	 	 Notices	 43
	 	 	
 14.1.   If to Landlord

	 43
	 	 	 14.2.    If to Tenant	 44
	 	 	 	 
	 15.	 	 Holding Over	 45
	 	 	 	 
	 16.	 	 Reservations in Favor of Landlord	 45
	 	 	 	 
	 17.	 	 Completion of Tenant Improvements; Delay in Possession; Allowance	 45
	 	 	 17.1.     Performance of Landlord and Tenant Improvements	 45
	 	 	 17.2.     Acceptance	 45
	 	 	 17.3.     Delay in Possession	 46
	 	 	 17.4.     Turnkey Delivery	 46
	 	 	 	 
	 18.	 	 Telecommunications Services	 46
	 	 	 18.1.     Contract with Provider	 46
	 	 	 18.2.     Landlord Has No Liability	 46
	 	 	 18.3.     License Agreement with Provider	 47
	 	 	 	 
	 19.	 	 Landlord's Reliance	 47
	 	 	 	 
	 20.	 	 Prior Agreements; Amendments	 47
	 	 	 	 
	 21.	 	 Captions	 48
	 	 	 	 
	 22.	 	 Landlord's Right to Cure	 48
	 	 	 	 
	 23.	 	

 Estoppel Statement

	 48
	 	 	 	 
	 24.	 	 Intentionally Deleted	 48
	 	 	 	 
	 25.	 	 Broker	 48
	 	 	 	 
	 26.	 	 Miscellaneous	 49
	 	 	 26.1.     Certain Interpretations	 49
	 	 	 26.2.     Partial Invalidity	 49
	 	 	 26.3.     Governing Law	 49
	 	 	 26.4.     Force Majeure	 49
	 	 	 26.5.     Light and Air	 50
	 	 	 26.6.     Recording	 50
	 	 	 26.7.     Preparation	 50

 

 

  

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	 	 	 26.8.    Third Party Inquiry	 50
	 	 	 26.9     Third Party Beneficiaries	 50
	 	 	 26.10   No Joint Venture	 50
	 	 	 26.11   Attorneys' Fees	 50
	 	 	 26.12   Names	 50
	 	 	
 26.13   Multiple Tenants

	 51
	 	 	 26.14   Time is of the Essence	 51
	 	 	 26.15   Execution and Delivery	 51
	 	 	
 

	 
	 27.	 	 Quiet Enjoyment	 51
	 	 	 	 
	 28.	 	 Confidentiality	 51
	 	 	 	 
	 29.	 	 Patriot Act	 51
	 	 	 	 
	 30.	 	 Consents	 50
	 	 	 	 
	 31.	 	 Survival	 52
	 	 	 	 
	 32.	 	 Saving Clause	 52
	 	 	 	 
	 33.	 	 Renewal	 52
	 	 	 33.1.     Grant of Option	 52
	 	 	 33.2.     Procedure	 53
	 	 	 33.3.     Terms of Option	 54
	 	 	 33.4.     Failure To Exercise	 54
	 	 	 33.5.     Time of the Essence	 54
	 	 	 33.6.     Tenant’s Disagreement with Landlord’s Response	 54
	 	 	 	 
	 34.	 	 Tenant’s Right of First Offer	 55
	 	 	 34.1.     Landlord’s RFO Notice	 55
	 	 	 34.2.     Definition of	 56
	 	 	 34.3.     Exercise	 56
	 	 	 34.4.     Lease Terms	 57
	 	 	 34.5.     Failure to Exercise	 57
	 	 	 34.6.     Termination of Tenant’s First Offer Option	 57
	 	 	 	 
	 	 	 Index of Certain Defined Terms	 59
	 	 	 	 

 

 

	 	 	 

 

 

 

SCHEDULE OF EXHIBITS

 

 

 

	 EXHIBIT	 	 TITLE (REFERENCE)
	 	 	 
	 A-1	 	 FLOOR PLAN OF THE PREMISES

 

 

 

 

 

  

-iv-

  

 

 

 

	 B	 	 INTENTIONALLY DELETED
	 	 	 
	 C	 	 CONFIRMATION OF LEASE TERM
	 	 	 
	 D	 	 JANITORIAL SERVICES
	 	 	 
	 E	 	 RULES AND REGULATIONS
	 	 	 
	 F	 	 TENANT IMPROVEMENTS
	 	 	 
	 G	 	 ESTOPPEL CERTIFICATE
	 	 	 

 

 

  

-v-  

  

PRINCETON SOUTH CORPORATE CENTER

OFFICE LEASE

THIS PRINCETON SOUTH CORPORATE CENTER OFFICE LEASE (the “Lease”) is made this 3rd day of February, 2012 (the “Execution Date”), by and between PRINCETON SOUTH INVESTORS, LLC, a Delaware limited liability company (hereinafter called “Landlord”), and ANTARES PHARMA, INC., a Delaware corporation (hereinafter called “Tenant”). Landlord and Tenant are sometimes referred to herein individually as “Party”, or collectively as the “Parties”.

 

1. Premises; Use.

 

1.1.  Letting and Premises; Use.  Landlord, for the Term (as defined below) and subject to the provisions and conditions hereof, leases to Tenant, and Tenant hereby rents from Landlord, the space (hereinafter referred to as the “Premises” and more particularly delineated on the Floor Plan attached hereto as Exhibit “A-1” and made a part hereof) being, for purposes of the provisions hereof 8,065 rentable square feet of which 6,931 shall be usable square feet, located on the Third floor of the office building (hereinafter referred to as the “Building”) currently known as 100 Princeton South Corporate Center Condominium – Unit 1, or such other name as Landlord may from time to time designate, with an address of, 100 Charles Ewing Boulevard, Ewing, Mercer County, New Jersey 08628, to be used by Tenant in accordance with any and all applicable Governmental Requirements and only for general office purposes and associated incidental uses and for no other purpose whatsoever (“Permitted Uses”).

 

1.2.  Property.  The property consists of the parcel of land, containing approximately 5.4 acres, on which the Building is located, together with the Building and other improvements thereon, identified as Unit Number 1 of the Princeton South Corporate Center Condominium, located at or about Charles Ewing Boulevard in Ewing Township, Mercer County, New Jersey (the “Property”).  Landlord reserves the right, in its sole discretion, at any time and from time to time, to expand and/or reduce the amount of ground and/or improvements of which the Property consists.

 

1.3.  Common Facilities.  Tenant and its agents, employees and invitees, shall have the right to use, free of charge, in common with all others granted such rights by Landlord, in a proper and lawful manner, the common sidewalks, driveways, access roads, parking areas, if any, and other outdoor areas within the Property, the common entranceways, lobbies and elevators furnishing access to the Premises, and (if the Premises includes less than a full floor) the common lobbies, hallways and toilet rooms (on the floor on which the Premises is located) in the Building.  Common Facilities as of the Execution Date of this Lease shall include the non-exclusive use of the conference center and fitness center located in building 200 Princeton South Corporate Center and all such other common facilities which may become available to all other tenants after execution of this Lease and which are located at the Property. Such use shall be subject to the terms of this Lease and to such reasonable rules, regulations, limitations and requirements as Landlord may from time to time prescribe with respect thereto, including, without limitation, the reservation of any particular parking spaces or parking areas for the exclusive use of other tenants of the Property.

  

  

  

 

 

1.4.  Use of Parking Facilities.

 

(i) Subject to the other provisions of this Lease, and excluding those parking spaces designated by Landlord as being reserved, Tenant shall have free non-exclusive use, in common with all other tenants, licensees, and invitees of the Property, of the parking spaces in the parking facilities serving the Property (“Non-Reserved Spaces”), for Tenant, Tenant’s employees, Tenant’s business invitees and Tenant’s agents, each day of the week during normal business hours for the Building; provided, however, that at no time during any day during the term of this Lease shall the number of Non-Reserved Spaces actually occupied by Tenant, Tenant’s employees, business invitees and agents exceed four (4) parking spaces for each 1,000 usable square feet comprising the Premises, or twenty-eight (28) spaces in the aggregate based on a usable area of 6,931 square feet (such figure being a maximum number of spaces which may be utilized by or for Tenant at any one time, but Landlord does not represent or guarantee that such number of spaces will in fact be available at any one time at the Property for Tenant’s use), provided, however, that Tenant may, on occasion, request Landlord’s approval to use a reasonable number of additional parking spaces for one-time, special events and Landlord will not arbitrarily withhold its consent.  Tenant shall not park any commercial trucks or any delivery vehicles in the parking areas or driveways, except as specifically designated by Landlord from time to time, and shall confine all commercial truck parking, loading and unloading to times and locations specifically designated by Landlord from time to time.  Tenant shall require all commercial trucks servicing Tenant to be promptly loaded or unloaded and removed from the site.  Landlord hereby reserves the exclusive right with respect to the use of parking facilities, roadways, sidewalks, driveways, islands and walkways for advertising purposes.  Tenant covenants and agrees to reasonably enforce the provisions of this Lease against Tenant’s employees, agents, contractors and business invitees.  Landlord may from time to time circulate parking stickers for the purpose of identifying motor vehicles of Tenant and Tenant’s employees and/or circulate validation tickets for the purpose of identifying Tenant’s business invitees.  Landlord shall have the right, but not the obligation: (a) to police said parking facilities, (b) to provide parking attendants, (c) to cause unauthorized and/or unregistered motor vehicles to be towed away at the sole risk and expense of the owner of such motor vehicles, (d) to designate certain areas of the parking facilities for the exclusive use of motor vehicles having handicapped designations on their license plates and/or for the exclusive use of visitors to the Property, (e) to use any portion of the parking facilities from time to time and/or to deny access to the same temporarily in order to repair, maintain or restore such facilities or to construct improvements under, over, along, across and upon the same for the benefit of the site and to grant easements in the parking facilities to any Authorities (as hereinafter defined), (f) to adopt and modify from time to time rules and regulations for parking and vehicular ingress, egress, speed, no parking, no standing, and for times and places for move-in, move-out and deliveries, (g) to designate fire lanes and restricted parking from time to time and (h) to designate from time to time specific areas for the parking of Tenant’s employees cars.

 

(ii) Nothing set forth in this Lease shall be deemed or construed to restrict Landlord from making any repairs, renovations, replacements, improvements and modifications to, or from reconfiguring, any of the parking facilities and/or other common facilities serving the Building, and Landlord expressly reserves the right to make any such repairs, renovations, replacements, improvements and modifications or reconfigurations to such areas and facilities as Landlord may deem appropriate, including but not limited to the addition 

 

 

 

  

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or deletion of temporary and/or permanent buildings, structures or other improvements therein.  In connection with the foregoing, Landlord may temporarily close or cover entrances, doors, windows, corridors, or other facilities without liability to Tenant; however, in doing so, Landlord shall use commercially reasonable efforts to minimize disruption of Tenant’s use and occupancy of the Premises and shall at all times ensure access to and from the Premises and the Building.

  

1.5.             Rentable Square Feet.  Tenant understands, acknowledges and agrees (i) that the amount of rentable square feet set forth in Paragraph 1.1 above is calculated based upon a 16.36% add on factor and (ii) that such amount of rentable square feet is hereby accepted by Tenant for all purposes of this Lease, including, without limitation, for purposes of determining Minimum Rent, Tenant’s Proportionate Share of applicable items of Taxes and Operating Expenses, Tenant’s construction allowance, if any, and other items which are based upon the computation of square footage.

 

2. Term; Commencement.

 

2.1.  Duration.  The term of this Lease shall commence on the “Commencement Date”, which term shall mean the earliest to occur of the following:  (i) the date of Substantial Completion, as defined below, of the Premises, or (ii) the date on which Tenant shall take possession of the Premises or any part thereof, or (iii) the date on which Tenant could have taken possession of the Premises had a “Tenant Delay”, as defined in Exhibit “F” attached hereto, not occurred.  Unless extended or sooner terminated as herein provided, the initial term of this Lease (the “Term”) shall continue until, and shall expire on, the last day of the ninetieth (90th) full calendar month following the Commencement Date.  The Parties agree that the target date of Substantial Completion is April 30, 2012 (the “Target Commencement Date”, subject to delays due to force majeure events or Tenant Delays, as defined in Exhibit “F”).

 

2.2.  Substantial Completion.  The term “Substantial Completion” shall mean that state of completion of the Premises which will, except for any improvements or work to be performed by Tenant, allow Tenant to utilize the Premises for the permitted use hereunder (including the availability of required utility services) without material interference to the customary business activities of Tenant by reason of the completion of Landlord’s work, all as more fully described in Paragraph 17 below and Exhibit “F” attached hereto and the Floor Plan annexed thereto, provided that the foregoing will not be construed to relieve Tenant of the obligation to install all Tenant Work (as defined in Exhibit “F”), and to perform all other installations of furniture, fixtures and equipment in the course of taking occupancy and moving into the Premises, properly if and to the extent applicable governmental authorities require that such construction and other installations be completed prior to conducting final inspections or issuing a final inspection certificate, certificate of occupancy, or its equivalent (any of the foregoing, an “Occupancy Permit”) for the Premises (and Substantial Completion shall nevertheless be deemed to have occurred if Landlord has completed the Tenant Improvements (as defined in Exhibit “F”) to the extent described above, but Tenant is denied an Occupancy Permit because Tenant has failed to install any Tenant Work or to perform all other installations of its furniture, fixtures and equipment properly and in accordance with applicable Governmental Requirements).  The Premises shall be deemed substantially complete even though minor or insubstantial details of construction, mechanical adjustment or decoration remain to be

 

 

  

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performed, the non-completion of which does not materially interfere with Tenant’s use of the Premises or the conduct of its business therein.

 

2.3.  Confirmation.  Within twenty (20) days after the Commencement Date of the term of this Lease is established, Landlord and Tenant shall promptly execute and acknowledge a “Confirmation of Lease Term”, in the form set forth in Exhibit “C” hereto, containing the information set forth in Exhibit “C” and acknowledging the Commencement Date and expiration date of the term hereof, provided that the failure of Landlord and/or Tenant to execute such Confirmation shall not prevent the occurrence of the Commencement Date or the commencement of the term of this Lease.

 

2.4.  Acceptance of Work.  On the Commencement Date, it shall be presumed that all work theretofore performed by or on behalf of Landlord was satisfactorily performed in accordance with, and meeting the requirements of, this Lease.  The foregoing presumption shall not apply, however, (i) to required work not actually completed by Landlord and identified and described in a written punch-list to be jointly prepared and initialed by Landlord and Tenant at or about the date on which Tenant shall occupy the Premises; and/or (ii) to deficiencies or inadequacies in the work which Tenant brings to Landlord’s attention in writing, with specificity, prior to the execution of the Confirmation of Lease Term (but no later than sixty (60) days after the Commencement Date) (and all of the work so identified and described on the punch-list or as timely brought to Landlord’s attention as aforesaid which is Landlord’s responsibility shall be completed by Landlord with reasonable speed and diligence).  Any damage to the Premises caused by Tenant’s move-in shall be repaired at Tenant’s expense.

 

2.5.  Early Access.  Commencing ten (10) business days prior to Substantial Completion of the Premises (the “Early Access Date”), Tenant shall have access to the Premises solely for the purposes of receiving and/or installing Tenant’s furniture, fixtures, telephones, computer equipment and other small business equipment in preparation for Tenant’s occupancy of the Premises.  In connection with such access, Tenant agrees (i) to cease promptly upon notice from Landlord any activity or work which has not been approved by Landlord (where such approval is required) or is not in compliance with the provisions of this Lease or which shall materially interfere with or materially delay the performance of the Tenant Improvements, and (ii) to comply and cause its contractors to comply promptly with all reasonable procedures and regulations prescribed by Landlord from time-to-time for coordinating work being performed by Landlord and work being performed by Tenant, each with the other, and with any other activity or work in the Building.  Such access by Tenant shall be deemed to be subject to all the applicable provisions of this Lease, except that (a) there shall be no obligation on the part of Tenant solely because of such access to pay Minimum Rent or any additional rent on account of Operating Expenses or Taxes for any period prior to the Commencement Date, and (b) Tenant shall not be deemed thereby to have taken or accepted possession of the Premises or any portion thereof.  If Tenant fails or refuses to comply or cause its contractor to comply with any of the obligations described or referred to above following notice and a two (2) business day cure period, then immediately upon notice to Tenant, Landlord may revoke Tenant’s right of access to the Premises until the Commencement Date.

 

 

  

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3. Minimum Rent; Increases in Minimum Rent; Security Deposit.

 

3.1.  Amount and Payment.  Tenant’s obligation to pay minimum rent for the Premises (“Minimum Rent”) shall commence on the six (6) month anniversary of the Commencement Date (the “Rent Commencement Date”) and shall accrue thereafter as follows:

	
 

Lease Period

	 	
Annual Minimum Rent Per Rentable Square Foot

	 	 	
Monthly

Minimum Rent

	 	 	
Annual

Minimum Rent

	 
	
 

Rent Commencement Date – End of the 18th calendar month after the Commencement Date

	 	$	27.25	 	 	$	 18,314.27	 	 	$	 219,771.25	 
	
 

Month 19 - 30

	 	$	27.75	 	 	$	 18,650.31	 	 	$	 223,803.75	 
	
 

Months 31 - 42

	 	$	28.25	 	 	$	 18,986.35	 	 	$	 227,836.25	 
	
 

Months 43 - 54

	 	$	28.75	 	 	$	 19,322.40	 	 	$	 231,868.75	 
	
 

Months 55 - 66

	 	$	 29.25	 	 	$	 19,658.44	 	 	$	 235,901.25	 
	
 

Month 67 – 78

	 	$	29.75	 	 	$	 19,994.48	 	 	$	 239,933.75	 

	
Month 79 – 90

	 	$	30.25	 	 	$	20,330.52	 	 	$	243,966.25	 

Minimum Rent set forth above has been calculated to include Tenant’s Proportionate Share of the Base Amount for Taxes and Tenant’s Proportionate Share of the Base Amount for Operating Expenses.

* In the event of any default by Tenant under this Lease between the Commencement Date and the Rent Commencement Date (the “Abatement Period”) which is not cured within the applicable grace period set forth in this Lease, the abatement of Minimum Rent during such period shall be revoked, null and void.

Minimum Rent shall be payable during the term hereof, in advance, in the monthly installments as set forth above, without demand, offset, abatement, diminution or reduction. The first installment shall be payable upon the execution of this Lease and subsequent installments shall be payable on the first day of each successive month of the term hereof following the Rent Commencement Date.

 

3.2.  Partial Month.  If the Rent Commencement Date occurs on a day other than the first day of a month, rent from such day until the first day of the following month shall be prorated (at the rate of one-thirtieth (1/30) of the fixed monthly rental for each day) and shall be payable, in arrears, on the first day of the first full calendar month following the Rent Commencement Date (and, in such event, the installment of rent paid at execution hereof shall be applied to the rent due for the first full calendar month following the Rent Commencement Date).

 

3.3.  Address For Payment.  All rent and other sums due to Landlord hereunder shall be made payable to Landlord and paid to the following address (if paid by check):

 

 

 

  

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Princeton South Investors, LLC

c/o RPO Property Management

2929 Arch Street – 28th Floor

Philadelphia, PA 19104-2868

Attn: Accounting

 

or to such other party or at such other address or by such other means (such as automatic debit or electronic transfer) as Landlord may designate, from time to time, by written notice to Tenant.  All payments of Rent (as defined in Section 3.5 below) shall be by good and sufficient check or by other means (such as automatic debit or electronic transfer) acceptable to Landlord.

 

3.4.             Non-Waiver of Rights.  If Landlord, at any time or times, shall accept rent or any other sum due to it hereunder after the same shall become due and payable, such acceptance shall not excuse delay upon subsequent occasions, or constitute, or be construed as, a waiver of any of Landlord’s rights hereunder.  At all times that Landlord shall direct Tenant to pay rent or other sums to a “lockbox” or other depository whereby checks, wire transfers or direct deposits issued in payment of rent or other sums are initially cashed or deposited by a person or entity other than Landlord (albeit on Landlord’s authority), then, for any and all purposes under the Lease:  (i) Landlord shall not be deemed to have accepted such payment until five (5) business days after the date on which Landlord shall have actually received such funds, and (ii) Landlord shall be deemed to have accepted such payment if (and only if) within said five (5) business day period, Landlord shall not have refunded (or attempted to refund) such payment to Tenant (and such refund or attempted refund by Landlord shall be deemed to constitute conclusive evidence that the processing of such payment by the applicable depository did not constitute an acceptance of payment by Landlord, or an accord and satisfaction of any kind).  Nothing contained in the immediately preceding sentence shall be construed to place Tenant in default of Tenant’s obligation to pay rent or other sums if and for so long as Tenant shall timely pay the rent or other sums required pursuant to the Lease in the manner designated by Landlord.

 

3.5.             Additional Sums Due; No Set-Off.  All sums payable by Tenant under this Lease, whether or not stated to be rent, Minimum Rent or additional rent (including, without limitation, the amounts due under Paragraphs 4.2, 4.3 and 5 of this Lease), shall be collectible by Landlord as rent (“Rent”), and upon default in payment thereof Landlord shall have the same rights and remedies that apply upon any failure to pay rent (without prejudice to any other right or remedy available therefor).  All Minimum Rent, additional rent and other sums payable by Tenant under this Lease shall be paid, when due, without demand (except as otherwise expressly set forth in this Lease), offset, abatement, diminution or reduction. Additional rent shall include all sums which may become due by reason of Tenant’s failure to comply with any of the terms, conditions and covenants of the Lease to be kept and observed by Tenant and any and all damages, costs and expenses (including without limitation thereto reasonable attorney fees) which Landlord may suffer or incur by reason of any default of Tenant.  Without limiting the foregoing, Tenant shall be responsible for all attorneys’ fees incurred by Landlord in any court proceeding or in any bankruptcy proceeding brought by or against Tenant and relating to the exercise of Landlord’s rights under the Bankruptcy Code, including, without limitation, Landlord’s rights under Sections 362, 365 and/or 503 of the Bankruptcy Code.

 

 

 

  

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3.6.  Personal Property and Other Taxes.  As additional rent and to the extent not included in Taxes, Tenant shall pay monthly or otherwise when due, whether collected by Landlord or collected directly by the governmental agency assessing the same, any government imposed taxes  calculated on Tenant’s rent or with respect to Tenant’s use or occupancy of the Premises or Tenant’s business or right to do business in the Premises, including, without limitation, a gross receipts tax or sales tax on rents or a business privilege tax or use or occupancy tax, whether such tax exists at the date of this Lease or is adopted hereafter during the Term of this Lease or during any renewal or extension thereof; but nothing herein shall be taken to require Tenant to pay any income, estate, inheritance or franchise tax imposed upon Landlord or any tax relating to any property owned by Landlord other than the Property.  Without limiting the foregoing, Tenant will pay promptly when due and in any event not later than fifteen (15) days after receipt of a bill (whether such bill be submitted by Landlord, the appropriate governmental body or otherwise) all city, state, county and local taxes and fees imposed upon the use and occupancy of the Premises.  In addition to the foregoing, Tenant shall be responsible to pay when due all government imposed taxes upon all personal property of Tenant.

 

3.7.  Security Deposit.  As additional security for the full and prompt performance by Tenant of the terms and covenants of this Lease, Tenant has deposited with the Landlord the sum of Thirty Six Thousand Six Hundred Twenty-Eight and 54/100 Dollars ($36,628.54) (the “Security Deposit”) to be held in trust and which shall not constitute rent for any month unless so applied by Landlord and only on account of Tenant’s default.  Provided that no Event of Default has occurred or exists and that no event which, with the passage of time, the giving of notice or both would constitute an Event of Default then exists, at the end of the thirty-sixth (36th) calendar month of the term of this Lease, Landlord shall return to Tenant Eighteen Thousand Three Hundred Fourteen and 27/100 Dollars ($18,314.27) and thereafter, the Security Deposit shall be $18,314.27.  Landlord may, at its option, hold the Security Deposit in an interest bearing account at the state or federally chartered bank of its choice and shall have no obligation to segregate the Security Deposit from any other funds of Landlord, and interest earned on the Security Deposit, if any, shall belong to Landlord.  Tenant shall, upon demand, immediately restore any portion of the Security Deposit which is applied by Landlord in accordance with the provisions of this Lease.  To the extent that Landlord has not applied the Security Deposit on account of a failure of Tenant to comply with its obligations under this Lease, the Security Deposit shall be returned (without interest) to Tenant promptly after the expiration of this Lease and the full performance of Tenant hereunder (including, without limitation, any payment due by Tenant as a result of a reconciliation of Tenant’s additional rent obligations).  Until returned to Tenant after the expiration of the Lease and the full performance by Tenant of its obligations hereunder, the Security Deposit shall remain the property of Landlord. Tenant confirms that Landlord shall have the right of set-off against the Security Deposit to secure all of Tenant’s obligations to Landlord under this Lease (including all amounts due under Paragraph 3.5 above).  In the event of a voluntary or involuntary Chapter 11 or 7 Bankruptcy filing by or against Tenant, Tenant agrees that the Security Deposit shall be used first to satisfy any pre-petition obligations of Tenant and any lease-rejection damages claim of Landlord, and thereafter, any remaining Security Deposit shall be used to satisfy any post-petition obligations of Tenant.

 

 

 

  

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4. Increases in Taxes and Operating Expenses.

 

4.1.  Definitions.  As used in this Paragraph 4, the following terms shall be defined as hereinafter set forth:

 

(i) “Taxes” shall mean all taxes and assessments of whatever kind, general or special, ordinary or extraordinary, foreseen or unforeseen, imposed upon or payable by Landlord with respect to the Building and the Property, or with respect to the ownership or leasing thereof, or use of the Building and the Property, and any existing or future improvements to the Building or the Property, all of the foregoing as allocable and attributable to each given calendar year which occurs during the Term of this Lease (and any renewals and extensions thereof).  Taxes shall include, without limitation, real estate taxes, any assessment imposed by any public or private entity by reason of the Building or the Property being currently or hereafter located in a special services district or similar designation or any other tax based upon the receipt of rent, including gross receipts or sales taxes applicable to the receipt of rent.  Notwithstanding the foregoing, there shall be excluded from Taxes all excess profit taxes, franchise taxes, gift taxes, capital stock taxes, inheritance and succession taxes, estate taxes, federal and state income taxes, and other taxes to the extent applicable to Landlord’s general or net income (as opposed to rents, receipts or income attributable to operations at the Building or the Property).  If, due to a future change in the method of taxation, any franchise, income, profit or other tax, however designated, shall be levied or imposed in addition to or in substitution, in whole or in part, for any tax which would otherwise be included within the definition of Taxes, such other tax shall be deemed to be included within Taxes as defined herein.  Taxes also shall include amounts paid to anyone other than affiliated entities of the Landlord engaged by Landlord to contest the amount or rate of taxes, provided that the amounts so paid do not exceed the savings procured. Tenant acknowledges that the exclusive right to protest, contest or appeal Taxes shall be in Landlord’s sole and absolute discretion and Tenant hereby waives any or all rights now or hereafter conferred upon it by law to independently contest or appeal any Taxes.

 

(ii) (1)         “Operating Expenses” shall mean Landlord’s actual out-of-pocket expenses, adjusted as set forth herein and as allocable and attributable to each given calendar year which occurs during the Term of this Lease (and any renewals and extensions thereof), in respect of the ownership, operation, use, maintenance, repair, replacement and management of the Building and the Property, (after deducting any reimbursement, discount, credit, reduction or other allowance received by Landlord), and shall include, without limitation: (A) wages and salaries (and taxes and insurance imposed upon employers with respect to such wages and salaries) and fringe benefits paid to persons employed by Landlord to render services in the normal operation, maintenance, cleaning, repair and replacement of the Building and the Property and any security personnel for the Building and the Property, excluding any overtime wages or salaries paid for providing extra services exclusively for any specific tenants; (B) costs of independent contractors hired for, and other costs in connection with, the operation, security, maintenance, cleaning, repair and replacement of the Building and related facilities and amenities at the Property; (C) costs of materials, supplies and equipment (including trucks) used in connection with the operation, security, maintenance, cleaning, repair and replacement of the Building and related facilities and amenities at the Property; (D) costs of electricity, natural gas, steam, water, sewer, fuel and other utilities used at the Building or the Property, together with the cost of providing the services specified in Paragraph 5 hereof, and, at Landlord’s discretion, 

 

 

 

  

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costs of wiring, conduit, and other equipment and facilities for distribution of telecommunication services to the extent such utilities, services, equipment and/or facilities are not separately chargeable to an occupant of the Building; (E) cost of insurance for public and general liability insurance and insurance relating to the Building and the Property, including fire and extended coverage or “All-Risk” coverage, if available, and coverage for elevator, boiler, sprinkler leakage, water damage, and property damage, plate glass, personal property owned by Landlord, fixtures, and rent protection (all with such coverages and in such amounts as Landlord may elect or be required to carry), but excluding any charge for increased premiums due to acts or omissions of other occupants of the Building because of extra risk which are reimbursed to Landlord by such other occupants; (F) costs of tools, supplies and services; (G) costs of “Essential Capital Improvements,” as defined in and to the extent permitted pursuant to subparagraph 4.1(ii)(3) below; (H) costs of alterations and improvements to the Building or the Property made pursuant to any Governmental Requirements (as defined in subparagraph 4.1(iii) below) which are not capital in nature (except to the extent permitted by subparagraph 4.1(ii)(3) below), and which are not the obligation of Tenant or any other occupant of the Building or elsewhere in the Property; (I) legal and accounting fees and disbursements necessarily incurred in connection with the ownership, maintenance and operation of the Building and Property, and the preparation, determination and certification of bills for Taxes and Operating Expenses pursuant to this and other leases at the Building; (J) sales, use or excise taxes on supplies and services and on any of the other items included in Operating Expenses; (K) costs of redecorating, repainting, maintaining, repairing and replacing the common areas of the Building (including seasonal decorations); (L) management fees payable to the managing agent for the Building and the Property (provided, however, that if management fees are paid to any Affiliate of Landlord, then the amount thereof to be included in Operating Expenses shall not exceed such amount as is customarily being charged for similar services rendered to comparable buildings in the geographical sub-market within which the Property is located, but in no event less than three percent [3%] of all revenues); (M) the cost of telecommunications service, postage, office supplies, maintenance and repair of office equipment and similar costs related to operation of the Building’s management and superintendent’s offices; (N) the cost of assessments, licenses, permits and other fees and charges related to use, operation, maintenance, repair and replacement of the Building and the Property, other than any of the foregoing relating to tenant improvements; (O) the Property’s share of any expenses, fees or charges related to any association, condominium and/or similar entity of which the Property is a part (which expenses are incurred and allocated pursuant to the Master Deed and By-Laws of the Princeton South Corporate Center Condominium); and (P) without limiting any of the foregoing, any other expenses or charges which, in accordance with generally accepted accounting principles (“GAAP”) and management principles generally accepted with respect to a first-class suburban office building, would be construed as an operating expense.  Operating Expenses (including such as are stated above which relate or are applicable to the Property) shall include, without limitation, any and all sums for landscaping, ground and sidewalk maintenance, sanitation control, extermination, cleaning, lighting, snow removal, parking area and driveway striping and resurfacing, fire protection, fire safety, policing, security systems, public liability and property damage insurance, and expenses for the upkeep, maintenance, repair, replacement and operation of the Property, all as payable in respect of or allocable to the Building by virtue of the ownership thereof and such allocations will be made between the Building and other buildings proportionately among all thereof, (based upon the respective square footage of each) or equally

 

 

 

  

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among all thereof, or in such other proportions as may reasonably be determined by Landlord in the exercise of prudent management practices.  The term “Operating Expenses” shall not include: (a) the cost of redecorating or special cleaning or similar services to individual tenant spaces, not provided on a regular basis to other tenants of the Building; (b) wages or salaries paid to executive personnel of Landlord above the title of property manager; (c) the cost of any new item (not replacement or upgrading of an existing item) which, by standard accounting principles, should be capitalized (except as provided above or in Paragraph 4.1(ii)(3) below); (d) any charge for depreciation or interest paid or incurred by Landlord; (e) leasing commissions, finders fees and all other leasing expenses incurred in procuring tenants in the Building; (f) Taxes; (g) any costs incurred with respect to the ownership of the Building, as opposed to the operation and maintenance of the Building, including Landlord’s income taxes, excess profit taxes, franchise taxes or similar taxes on Landlord’s business; preparation of income tax returns; corporation, partnership or other business form organizational expenses; franchise taxes; filing fees; or other such expenses; or any costs incurred in cleaning up any environment hazard or condition in violation of any environmental law (except to the extent caused by Tenant); (h) legal fees for the negotiation or enforcement of leases; (i) expenses in connection with services or other benefits of a type which are not Building standard but which are provided to another tenant or occupant and not Tenant; (j) any items to the extent such items are reimbursed to Landlord by Tenant, or by other tenants or occupants of the Building or by third parties (including reimbursements related to (i) separately metered electricity, and (ii) Building Electricity); (k) depreciation, except in the form of a “sinking fund” for periodic replacement of carpeting and for periodic repainting (both in common areas only), or interest paid on any mortgage, or ground rents paid under land leases (except for payment of taxes, insurance costs and other expenses required under such leases), or amortization of capital expenditures except as permitted in Paragraph 4.1(ii)(3) below); (l) the cost of constructing tenant improvements or installations for any tenant in the Building, including any relocation costs; (m) brokerage commissions, origination fees, points, mortgage recording taxes, title charges and other costs or fees incurred in connection with any financing or refinancing of the Building; (n) attorneys’ fees and disbursements, incurred in connection with the leasing of space in the Building (including without limitation the enforcement of any lease or the surrender, termination or modification of any lease of space in the Building); (o) advertising and promotional expenses, brochures with respect to the Building; (p) cost of repairs or replacements occasioned by fire, windstorm or other casualty, the costs of which are reimbursed by insurance or reimbursed by governmental authorities in eminent domain; (q) overhead and profit increment paid to subsidiaries or affiliates of Landlord for services on or to the Property to the extent that the costs of such services exceed market-based costs for such services rendered by unaffiliated persons or entities of similar skill, competence and experience; (r) penalties, fines, legal expenses, or late payment interest incurred by Landlord due to violation by Landlord, or Landlord’s agents, contractors or employees, of either the payment terms and conditions of any lease or service contract covering space in the Building or Landlord’s obligations as owner of the Building (such as late payment penalties and interest on real estate taxes, late payment of utility bills); (s) any compensation paid to clerks, attendants or other persons in any commercial concession operated by Landlord in the Building from which Landlord receives any form of income whatsoever, whether or not Landlord actually makes a profit from such concession; or (t) costs incurred in connection with correcting latent defects in the Building, or in repairing or replacing Building equipment, where such repair or replacement results from original defects in design, manufacture or installation rather than from 

 

 

 

 

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ordinary wear and tear or use; (u) costs and fees incurred in connection with enforcing any obligations of other tenants of the Building or Property; defense of title to any part of the Building or Property, or landlord’s title to the Property or negligence or tortious conduct of the Landlord, Landlord’s Affiliates, employees (such term to include all employees, officers and directors of Landlord and other personnel who are directly involved with the operation, management, maintenance, and/or repair of the Premises, Building, or Property).

 

(2)           In determining Operating Expenses for any year, if less than 95% of the rentable square feet of the Building shall have been occupied by tenants at any time during such year, Operating Expenses shall be deemed for such year to be an amount equal to the like expenses which Landlord reasonably determines would normally be incurred had such occupancy been 95% throughout such year.  In addition, if Landlord is not furnishing any particular work or service (the cost of which, if performed by Landlord, would constitute an Operating Expense) to a tenant who has undertaken to perform such work or service in lieu of performance by Landlord, Operating Expenses shall nevertheless be deemed (or grossed up) to include the amount Landlord would reasonably have incurred if Landlord had in fact performed such work or service at its expense.  In no event shall the total amount of Taxes or total amount of Operating Expenses for any year be deemed to be less than the Base Amount for Taxes or the Base Amount for Operating Expenses, respectively.

 

(3)           In the event Landlord shall make a capital expenditure for an “Essential Capital Improvement”, as hereinafter defined in this subsection (3), during any year, the annual amortization of such expenditure (determined by dividing the amount of the expenditure by the useful life of the improvement), plus any reasonable interest or financing charges thereon, shall be deemed an Operating Expense for each year of such period.  As used herein, an “Essential Capital Improvement” means any of the following: (A) a labor saving device, energy saving device or other installation, improvement, upgrading or replacement which reduces or is intended to reduce Operating Expenses as referred to above, whether or not voluntary or a Governmental Requirement; or (B) an installation, improvement, alteration or removal of any improvements including architectural or communication barriers which are made to the Building by reason of any Governmental Requirement whether or not such improvements are structural in nature and enacted or made applicable to the Building after the Execution Date; or (C) an installation or improvement which directly enhances the safety of occupants or tenants in the Building generally, whether or not voluntary or a Governmental Requirement (as, for example, but without limitation, for general safety, fire safety or security).

 

            (iii)   “Governmental Requirements” shall mean all requirements under any federal, state or local statutes, rules, regulations, ordinances, or other requirements of any duly constituted public authority having jurisdiction over the Building (including, without limitation, the Premises) including, but not limited to, requirements under all applicable state, county or local building, zoning, fire and other codes, requirements, decisions, directors, orders or approvals and all federal, state and local requirements and regulations and the provisions of, and regulations promulgated pursuant to, any other law, rule, statute, ordinance or regulation governing accessibility by persons with physical disabilities (including, without limitation, 42 U.S.C. Section 12101 et seq. (the “Americans with Disabilities Act of 1990”), and all requirements and restrictions contained in or promulgated pursuant to any declaration or other document placed of record applicable to or affecting the Building.

 

 

 

  

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(iv) “Total Rentable Square Feet of Building” shall mean 113,730 square feet.

 

(v) “Base Amount for Taxes” and “Base Amount for Operating Expenses” shall mean the total of amount of Taxes and total of amount of Operating Expenses, respectively, allocable and attributable to calendar year 2012 (“Base Year”) for the Building.  The Base Amount for Operating Expenses shall be calculated on the basis of the Building being 95% occupied in accordance with Paragraph 4.1(ii)(2) hereof and shall be adjusted for the calendar year above stated to adjust for average and reasonable allowances for on-going repairs and maintenance.  The Base Amount for Taxes and the Base Amount for Operating Expenses shall be adjusted for the calendar year above stated to exclude from such applicable Base Amount extraordinary items of Taxes and/or Operating Expenses, as applicable, incurred in such calendar year.

 

(vi) “Tenant’s Proportionate Share” with respect to each of Taxes and Operating Expenses and Building Electricity (as defined in Section 5 of this Lease) shall be 7.0914%.  This is equal to the ratio of the rentable square feet of the Premises, as set forth above, to the Total Rentable Square Feet of Building.

 

(vii) “Tenant’s Share of Taxes” and “Tenant’s Share of Operating Expenses” shall mean, with respect to any calendar year during the Term, after the Base Year, the product of (A) Tenant’s Proportionate Share, multiplied by, (B)(1) with respect to Taxes, the amount, if any, by which the total amount of Taxes, for such calendar year exceeds the Base Amount for Taxes; and (2) with respect to Operating Expenses, the amount, if any, by which the total amount of Operating Expenses for such calendar year exceeds the Base Amount for Operating Expenses.

 

(viii) “Tenant’s Estimated Share” shall mean, with respect to any calendar year, the product of (A) Tenant’s Proportionate Share, multiplied by (B) the amount, if any, by which Landlord’s good faith estimate of the total of Taxes for such calendar year exceeds the Base Amount for Taxes, or the total of Operating Expenses for such calendar year exceeds the Base Amount for Operating Expenses, as applicable.

 

(ix) “Authority” or “Authorities” shall mean any or all duly constituted federal, state, county, or local governmental or quasi-governmental body, agency, department, authority, board, court, or instrumentality, specifically including, without limitation, the Township and any owners association now or hereafter affiliated with the Corporate Center (collectively, such owners associations are referred to herein as the “Owners Associations”), and any successor or assignee of any of the foregoing.

 

4.2.  Tenant’s Share of Taxes and Tenant’s Share of Operating Expenses.

 

(i) For and with respect to each calendar year which occurs after the Base Year and during the Term of this Lease (and any renewals or extensions thereof) there shall accrue, as additional rent, Tenant’s Share of Taxes and Tenant’s Share of Operating Expenses, appropriately prorated for any partial calendar year occurring within the Term.

 

 

 

  

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(ii) Landlord shall furnish to Tenant, on or before December 31 of each calendar year during the term hereof, a statement for the next succeeding calendar year setting forth Tenant’s Estimated Share as to each of Taxes and Operating Expenses and the information on which each such estimate is based.  On the first day of the new calendar year, Tenant shall pay to Landlord, on account of Tenant’s Estimated Share of Taxes and Tenant’s Estimated Share of Operating Expenses, an amount equal to one-twelfth (1/12) of Tenant’s respective Estimated Share, and on the first day of each succeeding month up to and including the time that Tenant shall receive a new statement of Tenant’s Estimated Share of Taxes or Tenant’s Estimated Share of Operating Expenses, Tenant shall pay to Landlord, on account of the respective Tenant’s Estimated Share, an amount equal to one-twelfth (1/12) of the then applicable Tenant’s Estimated Share.

 

(iii) Landlord shall furnish to Tenant, on or before April 30 of each calendar year during the term hereof, a statement (the “Expense Statement”) prepared by Landlord or its agent or accountants setting forth for the previous calendar year:  (A) the actual amount of Taxes and the actual amount of Operating Expenses, in each case, for the previous calendar year; (B) the Base Amount for Taxes and the Base Amount for Operating Expenses; (C) the Tenant’s Proportionate Share for Taxes and Tenant’s Proportionate Share for Operating Expenses; (D) the Tenant’s Share of Taxes and Tenant’s Share of Operating Expenses; (E) the Tenant’s Estimated Share of Taxes and Tenant’s Estimated Share of Operating Expenses; and (F) a statement of the amount due to Landlord, or to be credited to Tenant, as a final adjustment in respect of Tenant’s Share of Taxes and a statement of the amount due to Landlord, or to be credited to Tenant, as a final adjustment in respect of Tenant’s Share of Operating Expenses, in each case, for the previous calendar year (each, the “Final Adjustment Amount”).  The Final Adjustment Amount with respect to Taxes shall be calculated by subtracting the Tenant’s Estimated Share of Taxes from the Tenant’s Share of Taxes.  The Final Adjustment Amount with respect to Operating Expenses shall be calculated by subtracting the Tenant’s Estimated Share of Operating Expenses from the Tenant’s Share of Operating Expenses.  Within thirty (30) days of receipt of the Expense Statement to Tenant, Tenant shall pay to Landlord the Final Adjustment Amount for Taxes and the Final Adjustment Amount for Operating Expenses, each as calculated as set forth in the Expense Statement.  If any Final Adjustment Amount is a negative quantity, then Landlord shall credit Tenant with the amount thereof against the next payment of Minimum Rent due by Tenant hereunder, except that with respect to the last year of the Lease, if an Event of Default has not occurred, Landlord shall refund Tenant the amount of such payment in respect of the Final Expense Adjustment within thirty (30) days after Landlord provides the Expense Statement for such final year of the Lease.  In no event, however, shall Tenant be entitled to receive a credit greater than the payments made by Tenant as payments of Tenant’s Estimated Share of Taxes or Tenant’s Estimated Share of Operating Expenses, respectively, for the calendar year to which such Final Adjustment Amount relates.

 

4.3.  Disputes; Audit.  The information set forth on all statements furnished to Tenant pursuant to this Paragraph 4, including each Expense Statement, and all documents relating to Tenant’s Estimated Share of Taxes, Tenant’s Estimated Share of Operating Expenses, Tenant’s Share of Taxes, Tenant’s Share of Operating Expenses, each Final Adjustment Amount, and all supportive documentation and calculations, shall be deemed approved by Tenant unless, within ninety (90) days after submission to Tenant (the “Review Period”), Tenant shall notify Landlord in writing that it disputes the correctness thereof, specifying in detail the basis for such 

 

 

  

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assertion.  Pending the resolution of any dispute, however, Tenant shall continue to make payments in accordance with the statement or information as furnished.

 

(i) Tenant or its representative shall have the right to examine Landlord’s books and records with respect to the reconciliation of Operating Expenses for the prior calendar year, as set forth in the Expense Statement for such year, during normal business hours upon at least ten (10) days advance written notice to Landlord and provided such notice is delivered to Landlord prior to the end of the Review Period.  Any such audit (a) shall be conducted where such records are customarily maintained during regular business hours and (b) shall not be conducted more than once in any calendar year.  In no event may Tenant audit the Base Year or any operating year more than one (1) time.  Unless Tenant shall give Landlord written notice objecting to said reconciliation and specifying the items in which said reconciliation is claimed to be incorrect within sixty (60) days after its examination of Landlord’s books and records, said reconciliation shall be considered as final and accepted by Tenant. Notwithstanding anything to the contrary contained in this Section, Tenant shall not be permitted to examine Landlord’s books and records or to dispute the Expense Statement unless Tenant has paid to Landlord the amount due as shown on the Expense Statement; said payment is a condition precedent to said examination and/or dispute.  If such audit shall disclose that Operating Expenses have been overstated, Tenant shall deliver a letter to Landlord setting forth Tenant’s position accompanied by a reasonably detailed explanation of and together with reasonably detailed supporting data evidencing the basis on which the claim of an overcharge is made (an “Overcharge Notice’).  Upon receipt of an Overcharge Notice, Landlord shall, within thirty (30) days of receipt of the Overcharge Notice, either (a) notify Tenant in writing that it agrees with the determination set forth in the Overcharge Notice and Landlord shall credit Tenant with the amount of such overcharge against the next succeeding amount of Tenant’s Share of Operating Expenses due from Tenant, or (b) notify Tenant in writing that it does not agree with the determination set forth in the Overcharge Notice (“Landlord’s Dispute Notice”).  Landlord’s failure to timely provide a Landlord’s Dispute Notice shall be treated as if Landlord provided a Landlord’s Dispute Notice.

                                 (ii)           In the event Landlord provides (or is deemed to have provided) Tenant with a Landlord’s Dispute Notice, and Landlord and Tenant, acting in good faith, are not able to resolve the dispute within thirty (30) days, then the Landlord and Tenant shall, as soon as reasonably practicable thereafter, select an independent arbitrator, approved from the American Arbitration Association, to resolve the dispute, the cost of such arbitrator to be paid for by the non-prevailing party.  If it is determined by the arbitrator named above that, with respect to Operating Expenses, a discrepancy exists such that Operating Expenses as stated on the applicable statement exceeds the determination of the arbitrator, then Landlord shall credit Tenant with the amount of such overcharge (i.e. the difference between the amount indicated on the applicable statement and the amount determined by the arbitrator) against the next succeeding amount of additional rent due from Tenant, and if the arbitrator determines that Landlord has overcharged Tenant by more than ten percent (10%), Landlord shall credit Tenant with the amount of such overcharge (i.e. the difference between the amount indicated on the applicable statement and the amount determined by the arbitrator) against the next succeeding amount of additional rent due from Tenant and pay the reasonable cost of Tenant’s audit within thirty (30) days after written demand therefore.  If it is determined by the arbitrator named above that a discrepancy exists which is less than or equal to two percent (2%), then Tenant shall, in

  

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addition to paying the cost of the arbitrator, pay all of Landlord's reasonable costs incurred or paid in connection with or arising out of such audit.  The determination of such arbitrator shall be final and binding on the parties.

 

(iii)           In the exercise of Tenant’s audit right under this Section, Tenant shall not engage any person or firm compensated on a contingency fee basis, and Tenant and its representative shall maintain all matters relating to any audit in confidence.  In addition to and in furtherance of the foregoing, Tenant shall not share the results of any audit performed hereunder with any other tenant in the Building.  Tenant shall provide Landlord with a copy of Tenant’s audit promptly upon written request by Landlord as a condition to Landlord’s consideration of any adjustment.

 

 

4.4.    Survival.  Notwithstanding anything herein contained to the contrary, Tenant understands and agrees that additional rent for increases of Taxes and/or Operating Expenses described in this Paragraph 4 are attributable to and owing for a specific twelve (12) month period, and are generally determined in arrears.  Accordingly, Tenant agrees that, at any time following the expiration of the Term of this Lease, or after default by Tenant with respect to this Lease, Landlord may bill Tenant for (i) the entire amount of accrued and uncollected additional rent attributable to increases in Taxes and/or Operating Expenses under this Paragraph 4, and (ii) any unpaid charges for usage, services or other amounts with respect to any period during the Term of this Lease; and the amount of such bill shall be due and payable to Landlord within thirty (30) days after rendering thereof.

 

5.   Services.  Landlord agrees that during the Term of the Lease, Landlord shall provide services as set forth in this Paragraph 5.

 

5.1.   HVAC and Electricity.  Landlord shall furnish (a) heat, ventilation and air conditioning (“HVAC”) (including the labor, maintenance and equipment necessary to provide the same), (b) electricity and other utilities needed to operate such systems and (c) electricity for lighting and general power for office use.

 

(i) Separate Metering of Premises. The Premises shall be separately metered (as part of the Tenant Improvements) for electricity consumed in the Premises for lighting, plugs, and office equipment and machinery.  Landlord shall furnish to Tenant a statement setting forth the amount due for Tenant’s electrical consumption, meter readings providing measurements of Tenant’s electric consumption and the total amount set forth in such statement shall be due and payable by Tenant, as additional rent, within thirty (30) days after submission to Tenant by Landlord of such statement.  Tenant shall pay for such consumption, provided that Tenant shall not be charged more than the rates it would be charged for the same service and consumption if furnished directly to Premises.  Upon Tenant’s written request, Landlord shall provide actual statement of meter reading furnished upon Landlord by electric company.

 

(ii) Tenant’s Share of Building Electricity.  Tenant shall pay, as additional rent, Tenant’s Proportionate Share of all electricity consumed in connection with the operation of the common areas and all HVAC systems in the Building (“Building Electricity”), 

 

 

  

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such amount to be referred to as “Tenant’s Proportionate Share of Building Electricity”. Landlord shall invoice Tenant for Tenant’s Proportionate Share of Building Electricity by reflecting such amount in Tenant’s electric bill described in Paragraph 5.1(i) above.

 

(iii) After-Hours HVAC.  If Tenant requests, Tenant shall pay the cost of supplying the Premises with heat, ventilation and air conditioning services at times outside of Business Hours, at such rates as Landlord shall specify from time to time, to cover all of the estimated costs and expenses incurred by Landlord in connection with supplying the Premises with such services, including, without limitation, the costs of labor and utilities associated with such services and including applicable sales or use taxes thereon, such amounts to be paid by Tenant within thirty (30) days after receipt by Tenant of Landlord’s statement setting forth the amount due.  Tenant shall notify Landlord of any heat, ventilation and air conditioning required by Tenant outside of Business Hours by complying with the Building’s after-hours log-in procedures, in accordance with instructions provided by Landlord.  “Business Hours” shall mean Monday through Friday from 8:00 a.m. to 6:00 p.m. and on Saturday from 8:00 a.m. to 1:00 p.m., Holidays (defined below) excepted.  New Year’s Day, Memorial Day, Independence Day, Labor Day, Thanksgiving, Christmas, or any day set aside to celebrate such holidays are “Holidays” under this Lease.

 

(iv) Supplemental HVAC Equipment.  If Tenant requires heat, ventilation and/or air conditioning in addition to Building Standard Consumption (e.g., due to above-standard densities of personnel or heat generating equipment, including, but not limited to, computer, communications, or telephone switching equipment, whether due to energy consumption, configuration, concentration, location or otherwise, or for conference or training facilities, or for other similar or dissimilar items, uses or requirements of Tenant), Tenant may, or upon Landlord’s written request (if Landlord determines such to be necessary due to Tenant’s use of the Premises) shall, arrange for the installation of a separate air conditioning unit or system (“Supplemental HVAC Equipment”), subject to Landlord’s prior written approval and satisfaction of the other provisions regarding Tenant Improvements or alterations set forth in this Lease.  Tenant shall be responsible for the cost and installation of the Supplemental HVAC Equipment for its intended purpose, and for the maintenance, repair, replacement, operation and utilities (including electricity, and, as applicable, gas, steam, water and sewer) of the same and for any additional sub-meter needed to account for the electricity and any other utilities utilized to operate the Supplemental HVAC Equipment.  The cost of supplying electricity and other utilities, if any, for the Supplemental HVAC Equipment may be reflected in Tenant’s electric bill as described in Paragraph 5.1(i) above. “Building Standard Consumption” shall mean the consumption necessary, in Landlord’s reasonable judgment, for use and comfortable occupancy of the Premises when occupied by the density of people for which the building standard system was designed with occupants using Standard Office Equipment.  “Standard Office Equipment” shall mean all office equipment normally found in an office facility but shall not include “main frame” computer and communication systems, telephone switches and conference or training rooms (or items similar thereto) which require Additional Electric Equipment, as hereinafter defined below, or additional air conditioning service or systems.

 

(v) Additional Electrical Equipment. Tenant will not install or intentionally use electrically-operated equipment in excess of the design capacity of the Premises (as such design standards may be set forth within the Lease or otherwise established by Landlord 

 

 

 

  

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if not so set forth) and Tenant will not install or operate in the Premises any electrically-operated equipment or machinery other than that commonly used in the course of a normal office operation including small office machines without first obtaining the prior written consent of the Landlord not to be unreasonably withheld.  Landlord may condition any consent required under this Paragraph 5.1(v) upon the installation of transformers or electrical panels for such equipment or machinery.  Landlord shall replace, when and as requested by Tenant, light bulbs and tubes, and ballasts, within the Premises which are Building standard, the cost of which Building standard replacement light bulbs and tubes, and ballasts, plus the labor cost for such replacement, shall be included in Operating Expenses.  At Landlord’s option such undertaking of Landlord shall not include bulbs or tubes for any non-Building standard lighting, high hats, or other specialty lighting of Tenant, which shall be and remain the responsibility of Tenant.

 

(vi) System Failure.  Landlord shall not be responsible for any failure or inadequacy of the air conditioning system if such failure or inadequacy is proven to be a result of the occupancy of the Premises by persons in excess of the density anticipated or for which the system was designed, or if Tenant uses the Premises in a manner for which it was not designed, or if Tenant installs or operates machines, appliances or equipment which exceed the maximum wattage per square foot contemplated by, or generate more heat than anticipated in, the design of the Premises (as such design standards may be set forth within the Lease or otherwise established by Landlord if not so set forth).

 

(vii) Regulatory Compliance.  The furnishing of the foregoing heating, ventilation, air conditioning and electricity services shall be subject to any statute, ordinance, rule, regulation, resolution or recommendation for energy conservation which may be promulgated by any governmental agency or organization which Landlord shall be required to comply with or which Landlord determines in good faith to comply with.

 

5.2.  Water and Sewer. Landlord shall furnish the Building with water (i) for drinking, lavatory, toilet and sanitary sewer purposes drawn through fixtures installed by Landlord, (ii) necessary for the operation of the Building’s fire safety devices, and (iii) if required by the Building’s HVAC system, necessary for the operation of such system.

 

5.3.  Elevator; Access. Landlord shall provide passenger elevator service to the Premises during all working days (Saturday, Sunday and Holidays excepted) from 8:00 a.m. to 6:00 p.m., with a minimum of one elevator (which may be a freight elevator) subject to call at all other times.  Tenant and its employees and agents shall have access to the Premises at all times, subject to compliance with such security measures as shall be in effect for the Building.  Elevator services for freight shall be supplied in common with service to other tenants and for other Building requirements at reasonable times during Business Hours for routine deliveries in the ordinary course of Tenant’s business.  Unusual or unusually large deliveries requiring use of the freight elevators shall be scheduled in advance with Landlord so as not to interfere with the operations of the Building or other tenants.  Freight elevator service outside of Business Hours shall be provided to Tenant upon reasonable written advance notice, provided that Landlord reserves the right to impose charges equal to Landlord’s estimated cost for providing such service from time to time, which shall be payable by Tenant to Landlord not later than ten (10) days after Landlord’s bill therefor.  Tenant shall not be charged for its use of the freight elevator for its move into or out of the Premises.

 

 

  

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5.4.  Janitorial.  Landlord shall provide janitorial service to the Premises as specified on Exhibit “D” annexed hereto.  Any and all additional or specialized janitorial or trash removal service desired by Tenant (i) shall be contracted for by Tenant directly with Landlord’s janitorial agent and the cost and payment thereof shall be and remain the sole responsibility of Tenant, or (ii) at the option of Landlord, shall be contracted for by Landlord and paid for by Tenant to Landlord within thirty (30) days after the receipt of a statement to Tenant setting forth the amount due. If Landlord shall from time to time reasonably determine that the use of any cleaning service in the Premises, including without limitation, removal of refuse and rubbish from the Premises, is in an amount greater than usually attendant upon the use of such Premises as offices, the reasonable cost of such additional cleaning services shall be paid by Tenant to Landlord as additional rent, on demand.  Tenant shall comply with any reasonable recycling plans or programs established by Landlord from time to time.

 

5.5.  Security. Landlord shall provide a security card or code type access system at the main entrance to the Building for Tenant’s convenience. Tenant shall notify Landlord of any lost or misplaced access cards issued to or at the direction of Tenant, which shall be deactivated and replaced by Landlord at Tenant’s cost.  Tenant and Tenant’s employees, as well as other tenants of the Building, will have access to the Building using such access system.  During non-Business Hours, Tenant, its employees and invitees shall close and secure the entrances to the Building upon entering and exiting the Building.  Landlord makes no representation that the access system or any future system employed at the Building to monitor access to the Building outside of standard business hours will prevent unauthorized access to the Building or the Premises, and Tenant acknowledges that no security guards are provided by Landlord. Accordingly, Tenant agrees that Tenant shall be responsible for security of the Premises and the security and safety of Tenant’s employees, invitees, officers, directors, contractors, subcontractors and agents. In furtherance of the foregoing, Landlord assumes no liability or responsibility for Tenant’s personal property whether such are located in the Premises or elsewhere in the Building or the Property. Tenant further acknowledges that Landlord may (but shall have no obligation to) alter current security measures in the Building, and Tenant agrees that it shall cooperate fully, and shall cause its employees and invitees to cooperate fully, with any requests of Landlord in connection with the implementation of any new security procedures or other arrangements.  Tenant agrees to cooperate in any reasonable safety or security program developed by Landlord or required by Governmental Requirements.

 

5.6.  Repairs. Landlord shall, within a commercially reasonable time period after receiving notice of the need for such repairs, make (i) all structural repairs to the Building (including the foundation and roof), (ii) all repairs to the exterior windows and glass and all repairs to the common areas of the Building and (iii) all repairs which may be needed to the mechanical, electrical and plumbing systems in the Premises, excluding repairs to (or replacement of) any non-building standard fixtures or other improvements in the Premises installed by Tenant or made by or at the request of Tenant and requiring unusual or special maintenance.  In the event that any repair is required by reason of the negligence or abuse of Tenant or its agents, employees, invitees or of any other person using the Premises with Tenant’s consent, express or implied, Landlord may make such repair and add the cost thereof to the first installment of rent which will thereafter become due, unless Landlord shall have actually recovered such cost through insurance proceeds.

 

 

 

  

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5.7.  System Changes.  Tenant shall not install any equipment of any kind or nature whatsoever which would or might necessitate any changes, replacement or additions to the water, plumbing, heating, air conditioning or the electrical systems servicing the Premises or any other portion of the Building; nor install any plumbing fixtures in the Premises nor use in excess of normal office use any of the utilities, the common areas of the Building, the janitorial or trash removal services, or any other services or portions of the Building without the prior written consent of the Landlord, and in the event such consent is granted, the cost of any such installation, replacements, changes, additions or excessive use shall be paid for by Tenant, in advance in the case of any installations replacements and additions, and promptly upon being billed therefor in the case of charges in excessive use.

 

5.8.  Directory.  Landlord shall be obligated, at its sole expense, to maintain a directory of office tenants in the lobby area of the Building, on which shall be listed the name of Tenant.  In the event Landlord permits Tenant to add more names to the directory (which Landlord may grant or deny in its sole discretion), Tenant shall pay the actual cost of lobby directory signage over an allowance of one (1) directory space per Tenant.

 

5.9.  Limitation Regarding Services.

 

(i) It is understood that Landlord does not warrant that any of the services referred to in this Paragraph 5 will be free from interruption, including but not limited to from causes beyond the control of Landlord. Landlord reserves the right, without any liability to Tenant, and without being in breach of any covenant of this Lease, to interrupt or suspend service of any of the heating, ventilating, air-conditioning, electric, sanitary, elevator or other Building systems serving the Premises, or the providing of any of the other services required of Landlord under this Lease, whenever and for so long as may be necessary by reason of accidents, emergencies, strikes or the making of repairs or changes which Landlord is required by this Lease or by law to make or in good faith deems advisable, or by reason of difficulty, beyond Landlord’s control or influence, in securing proper supplies of fuel, steam, water, electricity, labor or supplies, or by reason of any other cause beyond Landlord’s reasonable control, including without limitation, mechanical failure and governmental restrictions on the use of materials or the use of any of the Building systems.  Without limiting the foregoing, in no event shall Landlord be liable to Tenant for any (a) loss, injury or damage to property, (b) loss of income or other business loss, or (c) other monetary damages (such as, but not limited to, diminution or abatement of rent (except as expressly set forth in sub-section (ii) below) or other compensation) nor shall this Lease or any of the obligations of Tenant be affected or reduced, as a result of any variation, interruption, or failure of any of the services provided for in this Section, regardless of the cause of such variation, interruption or failure (provided that (1) the same shall not relieve Landlord of any applicable obligation to perform repairs on Building systems to the extent (and subject to the limitations) provided for in this Lease; and (2) in each instance in which interruption or suspension of services is required or otherwise occurs, Landlord shall exercise commercially reasonable diligence to eliminate the cause of interruption and to effect restoration of service, and shall give Tenant reasonable notice, when practicable, of the commencement and anticipated duration of such interruption).  To the fullest extent permitted by law, Tenant hereby waives all rights to make repairs at the expense of Landlord or in lieu thereof to vacate the Premises as may be provided by any law, statute or ordinance now or hereafter in effect.  Landlord has no obligation and has made no promise to alter, remodel, improve, repair, 

 

 

 

  

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decorate or paint the Premises or any part thereof, except as specifically and expressly herein set forth.

 

(ii) Notwithstanding any terms to the contrary, if a stoppage or suspension of the HVAC systems, electricity service, elevator service and/or water and sewer services to the Building results in a “shutdown condition” (as defined below) at the Building or Premises solely as a result of such stoppage or suspension and such stoppage or suspension is not attributable to (a) Tenant and/or (b) a “force majeure” event (as defined below); then, after the continuation of such stoppage or suspension for seven (7) consecutive days after Landlord’s receipt of written notice from Tenant that the Building or Premises is in a shutdown condition as a result of such stoppage or suspension and commencing with the eighth (8th) consecutive day, Minimum Rent hereunder shall abate for the period the Building or Premises are in a shutdown condition as a result of such stoppage or suspension.  For purposes hereof, the Building or Premises shall be deemed to be in a “shutdown condition” only if as a result of such stoppage or suspension of the HVAC systems, electricity service, elevator service and/or water and sewer services to the Building (i) Tenant’s personnel cannot reasonably perform their ordinary functions in the Premises and (ii) Tenant shall have ceased all business operations in the Premises. In the event a shutdown condition, caused by the gross negligence or willful misconduct of Landlord continues, and Tenant is unable to and does not use the Demised Premises for Tenant’s intended business, for a period in excess of sixty (60) consecutive days, Tenant shall have the right to terminate this Lease, upon thirty (30) days prior written notice to Landlord, but to the extent Landlord is able to provide the service that has been interrupted or stopped within such 30-day notice period (or such longer period as is reasonably necessary provided that Landlord is diligently working to restore such service), Tenant’s termination shall be null and void and the Lease shall continue. 

 

6.  Care of Premises.  Tenant agrees, on behalf of itself, its employees and agents, that during the Term of this Lease, Tenant shall comply with the covenants and conditions set forth in this Paragraph 6.

 

6.1.    Insurance and Governmental Requirements.  At all times during the term of this Lease and any extension or renewal hereof, Tenant, at its cost, shall comply with, and shall promptly correct any violations of, (i) all requirements of any insurance underwriters, or (ii) any Governmental Requirements relating to Tenant’s use and occupancy of the Premises.  Tenant shall indemnify, defend and hold Landlord harmless from and against any and all loss, damages, claims of third parties, cost of correction, expenses (including applicable attorney’s fees) or fines arising out of or in connection with Tenant’s failure to comply with Governmental Requirements.  The provisions of this Paragraph 6.1 shall survive the expiration or termination of this Lease.

 

6.2.    Access.  Tenant shall give Landlord, its agents and employees, access to the Premises during Business Hours on reasonable advance notice of not less than one (1) business day, and at any time in the case of an emergency (without notice), without charge or diminution of rent, to enable Landlord (i) to examine the same and to make such repairs, additions and alterations as Landlord may be permitted to make hereunder or as Landlord may deem advisable for the preservation of the integrity, safety and good order of the Building or any part thereof; and (ii) upon reasonable notice, to show the Premises to prospective mortgagees and purchasers 

 

 

  

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and to prospective tenants.  If representatives of Tenant shall not be present on the Premises to permit entry upon the Premises by Landlord or its agents or employees, at any time when such entry by Landlord is necessary or permitted hereunder, Landlord may enter the Premises by means of a master key (or, in the event of any emergency, forcibly) without any liability whatsoever to Tenant and without such entry constituting an eviction of Tenant or a termination of this Lease.  Landlord shall not be liable by reason of any injury to or interference with Tenant or Tenant’s business arising from the making of any repairs, alterations, additions or improvements in or to the Premises or the Building or to any appurtenance or any equipment therein, unless injury to or interference with Tenant is as a result of the intentional or willful act of Landlord. In all events, Landlord shall use all reasonable efforts to minimize interference with Tenant’s business operations on Premises.

 

6.3.  Condition.

Other than repairs required to be performed by Landlord pursuant to the express provisions of Section 5.6, above, or repairs which are required due solely to the negligence or willful misconduct of Landlord (and of which Landlord has received written notice from Tenant, which notice shall state the cause of the damage for which such repair is required), Tenant shall keep the Premises and all improvements, installations and systems therein in good order and condition and repair all damage to the Premises and replace all interior glass broken by Tenant, its agents, employees or invitees, with glass of the same quality as that broken, except for glass broken by fire and extended coverage type risks, and Tenant shall commit no waste in the Premises.  If the Tenant refuses or neglects to make such repairs, or fails to diligently prosecute the same to completion, after written notice from Landlord of the need therefor, Landlord may make such repairs at the expense of Tenant and such expense shall be collectible as additional rent.  Any such repairs and any labor performed or materials furnished in, on or about the Premises shall be performed and furnished by Tenant in strict compliance with all applicable Governmental Requirements.  Without limitation of the foregoing, Landlord shall have the right to approve any and all contractors and suppliers to furnish materials and labor for such repairs.  Any contractors performing services for Tenant on or about the Premises or Building shall be subject to the requirements governing work by Tenant’s contractors as set forth in Exhibit “F” attached hereto and made a part hereof.

 

6.4.  Surrender.  Upon the termination of this Lease in any manner whatsoever, Tenant shall remove Tenant’s goods and effects and those of any other person claiming under Tenant, and quit and deliver up the Premises to Landlord peaceably and quietly in as good order and condition as at the inception of the term of this Lease or as the same hereafter may be improved by Landlord or Tenant, reasonable use and wear thereof, damage from fire and other insured casualty and repairs which are Landlord’s obligation excepted. Goods and effects not removed by Tenant at the termination of this Lease, however terminated, shall be considered abandoned and Landlord may dispose of and/or store the same as it deems expedient, the cost thereof to be charged to Tenant.  To the fullest extent permitted by applicable Law, Tenant’s Security Deposit may be applied to offset Landlord’s costs set forth in the preceding sentence.

 

6.5.  Signs.  Tenant shall not place signs on or about any part of the Building, or on the outside of the Premises or on the exterior doors, windows or walls of the Premises, except on 

 

 

  

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doors and then only of a type and with lettering and text approved by Landlord, such approval not to be unreasonably withheld.

 

6.6.  Care; Insurance.  Tenant shall not overload, damage or deface the Premises or intentionally do any act which might make void or voidable any insurance on the Premises or the Building or which may render an increased or extra premium payable for insurance (and without prejudice to any right or remedy of Landlord regarding this subparagraph, Landlord shall have the right to collect from Tenant, upon demand, any such increase or extra premium).

 

6.7.  Alterations; Additions. Tenant shall not make any single alteration of or addition to the Premises costing in excess of $10,000 (and not more than two such alterations or additions in any calendar year) without the prior written approval of Landlord (except for work of a decorative nature).  Such approval shall not be unreasonably withheld for nonstructural interior alterations, provided that (i) no Building systems, structure, or areas outside of the Premises are affected by such proposed alteration, and (ii) reasonably detailed plans and specifications for construction of the work, including but not limited to any and all alterations having any impact on or affecting any electrical systems, telecommunications systems, plumbing, HVAC, sprinkler system and interior walls and partitions, are furnished to Landlord for Landlord’s approval in advance of commencement of any work.  All such alterations and additions, as well as all fixtures, equipment, improvements and appurtenances installed in and affixed to the Premises at the inception of this Lease term (but excluding Tenant’s trade fixtures and modular furniture systems) shall, upon installation and at Landlord’s sole option, become and remain the property of Landlord.  All such alterations and additions shall be maintained by Tenant in the same manner and order as Tenant is required to maintain the Premises generally, and at Landlord’s option (exercised at the time Landlord approves such alteration or addition, if at all), upon termination of the term hereof, shall be removed at Tenant’s cost without damage to the Premises upon surrender, except that Tenant shall have no obligation to remove the Tenant Improvements.  All alterations and additions by Tenant shall be performed in accordance with the plans and specifications therefor submitted to and approved by Landlord, in a good and workerlike manner and in conformity with all Governmental Requirements.  In addition, all such alterations and additions shall be performed at Tenant’s sole cost and expense in strict compliance with the requirements governing work by Tenant’s contractors as set forth below.

 

(i) Work by Tenant’s Contractors.  Tenant may, at its sole expense, select and employ its own contractors for any Tenant Work (as defined in Exhibit “F” attached hereto), subject to the following qualifications, conditions and limitations:

 

(a) If Tenant is required to obtain Landlord’s approval of any work under the terms of this Lease, Tenant shall first obtain the approval of Landlord in writing of the specific work it proposes to perform and shall furnish Landlord with reasonably detailed plans and specifications for construction of the work and/or such other reasonable information requested by Landlord in connection therewith (such approval by Landlord not to be unreasonably withheld, conditioned or delayed);

 

(b) The Tenant Work shall be performed by responsible contractors and subcontractors, properly licensed to work and approved in advance by Landlord (such approval by Landlord not to be unreasonably withheld, conditioned or delayed).  

 

 

 

  

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Notwithstanding Landlord’s approval of any contractor or subcontractor, none of Tenant’s contractors and/or subcontractors shall, in Landlord’s reasonable opinion, prejudice Landlord’s relationship with Landlord’s contractors or subcontractors, or the relationship between the contractors and their subcontractors or employees, or disturb harmonious labor relations.  Each of Tenant’s contractors and subcontractors shall, unless prohibited by applicable law, prior to the commencement of any work, file waivers of mechanics’ liens on account of the work to be performed by any of Tenant’s contractors, subcontractors or material suppliers and execute an indemnification agreement satisfactory to Landlord agreeing, inter alia, to repair any damage to the Building and to indemnify, defend and hold Landlord harmless from and against all damage and loss incurred by Landlord as a result of work performed by Tenant, the general contractor and/or its subcontractor(s);

 

(c) Tenant shall have sole responsibility for compliance with all applicable Governmental Requirements relating to the performance of any Tenant Work, and shall at its expense procure all permits necessary with respect to the work to be performed by Tenant’s contractors or subcontractors;

 

(d)  No such work shall be performed in such manner or at such times as to interfere with any work being done by any of Landlord’s contractors or subcontractors in the Premises or in the Building generally (provided that Landlord gives Tenant reasonable prior notice of the performance of any such work by Landlord’s contractors or subcontractors);

 

(e)  Tenant and its contractors and subcontractors shall be solely responsible for the transportation, storage and safekeeping of materials and equipment used in the performance of any work, for the removal of waste and debris resulting therefrom on a daily basis, and for any damage caused by them to any installations or work performed by Landlord’s contractors and subcontractors; and Tenant’s contractors and subcontractors shall each deliver to Landlord a certificate of insurance indicating contractor liability in amounts and with companies and otherwise reasonably satisfactory to Landlord, naming the Premises as an insured site, and naming Landlord and the managing agent for the Building as additional insureds; and

 

(ii) Scheduling.  Without limiting any other requirements applicable to any work to be performed by or on behalf of Tenant, all of the Tenant Work (including, without limitation, the use of the freight elevator) shall be scheduled so as to avoid any unreasonable disruption to the ordinary operation of the Building and all other tenants’ and occupants’ use and enjoyment thereof.  Furthermore, Tenant agrees that any work that may result in excessive noise or vibration (such as, but without limitation, demolition work and coring holes, using screw guns to attach items to the floor and shooting studs into the floor) must be accomplished outside of Business Hours.

 

3.8.  Mechanics’ Liens.  Tenant shall not permit mechanic’s or other liens to be placed upon the Property or Premises in connection with any work or service done or purportedly done by or for the benefit of Tenant.  If a lien is so placed, Tenant, within twenty (20) days after notice from Landlord, (i) shall discharge (by bonding or otherwise) any mechanics’ lien for material or labor claimed to have been furnished to the Premises on Tenant’s 

 

 

 

  

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behalf (except for work contracted for by Landlord), (ii) shall deliver to Landlord satisfactory evidence thereof, and (iii) shall indemnify and hold harmless Landlord from any loss incurred in connection therewith.  If Tenant fails to discharge the lien, then, in addition to any other right or remedy of Landlord, Landlord may bond or insure over the lien or otherwise discharge the lien.  Tenant shall, within ten (10) days after receipt of an invoice from Landlord, reimburse Landlord for any amount paid by Landlord, including reasonable attorneys’ fees, to bond or insure over the lien or discharge the lien.

 

6.9.  Vending Machines. Tenant shall not install or authorize the installation of any coin operated vending machines within the Premises, except machines for the purpose of dispensing coffee, snack foods and similar items to the employees and business visitors of Tenant for consumption upon the Premises, the installation and continued maintenance and repair of which shall be at the sole cost and expense of Tenant.

 

6.10.  Rules and Regulations. Tenant shall observe the rules and regulations annexed hereto as Exhibit “E,” as the same may from time to time be amended by Landlord for the general safety, comfort and convenience of Landlord, occupants and tenants of the Building.

 

6.11.  Environmental Compliance. Tenant shall not transport, use, store, maintain, generate, manufacture, handle, dispose, release or discharge any “Waste” (as defined below) upon or about the Building, or permit Tenant’s employees, agents, contractors, and other occupants of the Premises to engage in such activities upon or about the Building or the Premises.  However, the foregoing provisions shall not prohibit the transportation to and from, and use, storage, maintenance and handling within, the Premises of substances customarily used in offices (or such other business or activity expressly permitted to be undertaken in the Premises pursuant to the terms of this Lease), provided: (a) such substance shall be used and maintained only in such quantities as are reasonably necessary for such permitted use of the Premises, strictly in accordance with applicable Governmental Requirements and the manufacturers’ instructions therefor, (b) such substances shall not be disposed of, released or discharged in the Building, and shall be transported to and from the Premises in compliance with all applicable Governmental Requirements, and as Landlord shall reasonably require upon advanced written notice to Tenant, (c) if any applicable Governmental Requirement or Landlord’s trash removal contractor requires that any such substances be disposed of separately from ordinary trash, Tenant shall make arrangements at Tenant’s expense for such disposal directly with a qualified and licensed disposal company at a lawful disposal site (subject to scheduling and approval by Landlord), and shall ensure that disposal occurs frequently enough to prevent unnecessary storage of such substances in the Premises, and (d) any remaining such substances shall be completely, properly and lawfully removed from the Building upon expiration or earlier termination of this Lease.

 

(i) Generally.  Tenant shall promptly notify Landlord of: (a) any enforcement, cleanup or other regulatory action taken or threatened by any governmental or regulatory authority with respect to the presence of any Waste on the Premises or the migration thereof from or to the Building, (b) any demands or claims made or threatened by any party against Tenant or the Premises relating to any loss or injury resulting from any Waste, (c) any release, discharge or non-routine, improper or unlawful disposal or transportation of any Waste on or from the Premises, and (d) any matters where Tenant is required by any Governmental 

 

 

 

  

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Requirement to give a notice to any governmental or regulatory authority respecting any Waste on the Premises.  Landlord shall have the right (but not the obligation) to join and participate as a party in any legal proceedings or actions affecting the Premises initiated in connection with any environmental, health or safety Governmental Requirement. At such times as Landlord may reasonably request, Tenant shall provide Landlord with a written list identifying any Waste then used, stored, or maintained upon the Premises and the use and approximate quantity of each such material.  Tenant shall also furnish Landlord with a copy of any material safety data sheet (“MSDS”) issued by the manufacturer as well as any written information concerning the removal, transportation and disposal of the same, and such other information as Landlord may reasonably require or as may be required by Governmental Requirement.  For purposes hereof: (A) the term “Waste” shall mean any hazardous or radioactive material, polychlorinated biphenyls, friable asbestos or other hazardous or medical waste substances as defined by the Comprehensive Environmental Response, Compensation and Liability Act, as amended, or by any other federal, state or local law, statute, rule, regulation or order (including any Governmental Requirements) concerning environmental matters, or any matter which would trigger any employee or community “right-to-know” requirements adopted by any such body, or for which any such body has adopted any requirements for the preparation or distribution of a MSDS; and (B) the term “Governmental Requirement” shall be deemed to include, without limitation, any and all regulations concerning environmental matters promulgated by the New Jersey Department of Environmental Protection or other applicable governmental authorities in the State of New Jersey.

 

(ii) Discharge.  If any Waste is released, discharged or disposed of by Tenant or any other occupant of the Premises, or their employees, agents or contractors, in or about the Building in violation of the foregoing provisions, Tenant shall immediately, properly and in compliance with applicable Governmental Requirements clean up and remove the Waste from the Building and clean or replace any affected property at the Building (whether or not owned by Landlord), at Tenant’s expense.  Such clean up and removal work shall be subject to Landlord’s prior written approval (except in emergencies), and shall include, without limitation, any testing, investigation, and the preparation and implementation of any remedial action plan required by any governmental body having jurisdiction or reasonably required by Landlord.  If Tenant shall fail to comply with the provisions of this Paragraph within fifteen (15) days after written notice by Landlord, or such shorter time as may be required by any Governmental Requirement or in order to minimize any hazard to any person or property, Landlord may (but shall not be obligated to) arrange for such compliance directly or as Tenant’s agent through contractors or other parties selected by Landlord, at Tenant’s expense (without limiting Landlord’s other remedies under this Lease or applicable Governmental Requirement).  If any Waste is released, discharged or disposed of on or about the Building and such release, discharge, or disposal is not caused by Tenant or other occupants of the Premises, or their employees, agents or contractors, such release, discharge or disposal shall be deemed casualty damage under Paragraph 8 to the extent that the Premises or common areas serving the Premises are affected thereby; in such case, Landlord and Tenant shall have the obligations and rights respecting such casualty damage provided under Paragraph 8.

 

(iii) Landlord’s Cleanup Rights.  Without relieving Tenant of its obligations under this Lease and without waiving any default by Tenant under this Lease, Landlord will have the right, but not the obligation, to take such action as Landlord deems 

 

 

 

  

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necessary or advisable to cleanup, remove, resolve or minimize the impact of or otherwise deal with any spill or discharge of any hazardous substance or hazardous waste on or from the Premises.  If a spill or discharge arises out of or relates to Tenant’s use and occupancy of the Premises, or if a spill or discharge is caused by the act, negligence or omission of Tenant or Tenant’s Visitors, then Tenant shall, on demand, pay to Landlord all costs and expenses incurred by Landlord in connection with any action taken in connection therewith by Landlord.

 

(iv) ISRA.  If Tenant’s operations at the Premises now or hereafter constitute an “Industrial Establishment” (as defined under the New Jersey Industrial Site Recovery Act, N.J.S.A. 13:1K et seq. (as may be amended or modified from time to time, including the accompanying regulations, “ISRA”)) or are subject to the provisions of any other Governmental Requirement, then Tenant agrees to comply, at its sole cost and expense, with all requirements of ISRA and any other applicable Governmental Requirement to the satisfaction of Landlord and the governmental entity, department or agency having jurisdiction over such matters (including, but not limited to, performing site investigations and performing any removal and remediation required in connection therewith) in connection with (i) the occurrence of the Termination Date, (ii) any termination of this Lease prior to the Termination Date, (iii) any closure, transfer or consolidation of Tenant’s operations at the Premises, (iv) any change in the ownership or control of Tenant, (v) any permitted assignment of this Lease or permitted sublease of all or part of the Premises or (vi) any other action by Tenant which triggers ISRA or any other Governmental Requirement.

 

(v) Compliance with ISRA.  Tenant further agrees to implement and execute all of the provisions of this section in a timely manner so as to coincide with the termination of this Lease or to coincide with the vacating of the Premises by Tenant at any time during the term of this Lease.  In connection with subsection (a) above, if, with respect to ISRA, Tenant fails to obtain a no further action and covenant not to sue letter from the New Jersey Department of Environmental Protection or to otherwise comply with the provisions of ISRA prior to the Termination Date, or if, with respect to any other Governmental Requirement, Tenant fails to fully comply with the applicable provisions of such other Governmental Requirement prior to the Termination Date, Tenant will be deemed to be a holdover tenant and shall pay rent at the rate set forth in Section 15 and shall continue to diligently pursue compliance with ISRA and/or such other Governmental Requirement.  Upon Tenant’s full compliance with the provisions of ISRA or of such other Governmental Requirement, Tenant shall deliver possession of the Premises to Landlord in accordance with the provisions of this Lease and such holdover rent shall be adjusted as of said date.

 

(vi) Tenant’s Cooperation.  If, in order to comply with any Governmental Requirement, Landlord requires any affidavits, certifications or other information from Tenant, Tenant shall, at Landlord’s expense (unless such information is required in connection with Tenant’s default or alleged default of this Lease, in which case it shall be at Tenant’s expense), deliver the same to Landlord within reasonable time (but no later than ten (10) days) after Landlord’s request therefor.

 

(vii) Survival.  Tenant’s obligations under this Section 6.11 shall survive the expiration or earlier termination of this Lease.

 

 

 

  

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(viii) North American Industry Classification System.  Tenant hereby represents and warrants to Landlord that Tenant’s operations at the Premises will at all times have the following North American Industry Classification System code: [54].

 

4. Subletting and Assigning.

 

4.1.  General Restrictions.  Tenant shall not assign this Lease or sublet all or any portion of the Premises (either a sublease or an assignment hereinafter referred to as a “Transfer”) without first obtaining Landlord’s prior written consent thereto, which shall not be unreasonably withheld, conditioned or delayed, subject to the terms of this Paragraph 7.  By way of example and without limitation (and without affecting any of Landlord’s rights under Section 365 of the Bankruptcy Code), the Parties agree it shall be reasonable for Landlord to withhold consent: (1) if the financial condition of the proposed transferee is not at least equal, in Landlord’s reasonable determination, to the financial condition (as of the date of this Lease) of the Tenant named herein; (2) if the proposed use within the Premises conflicts with the use provisions or restrictions on tenants or occupants set forth herein or is incompatible, inconsistent, or unacceptable with the character, use and image of the Building or the tenancy at the Building in Landlord’s reasonable opinion, or conflicts with exclusive use rights granted to another tenant of the Building; (3) if the business reputation and experience of the proposed transferee is not sufficient, in Landlord’s reasonable opinion, for it to operate a business of the type and quality consistent with other tenants in the Building; (4) if the document creating the Transfer is not reasonably acceptable to Landlord; (5) the nature of the fixtures and improvements to be performed or installed are not consistent with general office use and the terms of this Lease; (6) if the proposed transferee is an existing tenant of Landlord or an affiliate of Landlord (except if Landlord, or an affiliate of Landlord, has no other available space) or is currently negotiating or has negotiated within the prior twelve (12) months with Landlord for other space in the Building (or any other building owned by an affiliate of Landlord); (7) if the proposed user is a governmental or quasi-governmental agency; (8) if the proposed transferee will be using or if Landlord has reasonable cause to believe that it is likely to use Waste at the Premises other than those types of Waste normally used in general office operations in compliance with applicable Governmental Requirements; (9) if Landlord has reasonable cause to believe that the proposed transferee’s assets, business or inventory would be subject to seizure or forfeiture under any laws related to criminal or illegal activity; (10) if a proposed sublet involves more than twenty percent (20%) of the Premises (or, if such proposed sublet would result in more than twenty percent (20%) of the Premises, in the aggregate, being subject to one or more subleases); (11) if a proposed sublet is for less than Landlord’s then-current rental rates for the Building; (12) if the proposed user is subject to sovereign immunity, or (13) if any Mortgagee or Ground Lessor (as defined in Paragraph 13.1) withholds, conditions or delays its consent to a proposed assignment or sublease pursuant to a right to do so under such mortgage, deed to secure debt, deed of trust or other similar security instrument or under any underlying lease.  If Landlord consents to a Transfer, such consent, if given, will not release Tenant from its obligations hereunder and will not constitute a consent to any further Transfer. Tenant shall furnish to Landlord, in connection with any request for such consent, reasonably detailed information as to the identity and business history of the proposed assignee or subtenant, as well as the proposed effective date of the Transfer and, prior to the execution thereof, a complete set of the final documentation governing such Transfer, all of which shall be satisfactory to Landlord in form and substance.  If Landlord consents to any such Transfer, the effectiveness thereof shall nevertheless be conditioned on the 

 

 

  

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following:  (i) receipt by Landlord of a fully executed copy of the full documentation governing the Transfer, in the form and substance approved by Landlord, (ii) any subtenant shall acknowledge that its rights arise through and are limited by the Lease, and shall agree to comply with the Lease (with such exceptions as may be consented to by Landlord including, without limitation, an agreement by subtenant to pay all Minimum Rent and additional rent directly to Landlord upon Landlord’s written request therefor), and (iii) any assignee shall assume in writing all obligations of Tenant hereunder from and after the effective date of such Transfer.  Tenant shall not advertise or otherwise disseminate any information regarding the Building or the Premises (including, without limitation, rental rates or other terms upon which Tenant intends to Transfer) to potential assignees and/or subtenants without in each instance obtaining Landlord’s prior written approval and consent as to the specific form and content of any such advertisement, statement, offering or other information (including, without limitation, approval of rental rates and terms). Landlord’s acceptance of any name for listing on the Building Directory will not be deemed, nor will it substitute for, Landlord’s consent, as required by this Lease, to any Transfer, or other occupancy of the Premises.  Tenant shall not mortgage or encumber this Lease, or otherwise collaterally assign its leasehold interest hereunder.

 

7.2.  Definitions.  For purposes hereof, a Transfer shall include any direct or indirect transfer, in any single or related series of transactions, of (i) fifty percent (50%) or more of the voting stock of a corporate Tenant; (ii) fifty percent (50%) or more of the interests in profits of a partnership or limited liability company Tenant; or (iii) effective voting or managerial control of Tenant; provided, however, that the foregoing shall not apply to a tenant a majority of whose ownership interests are publicly-traded on a nationally-recognized exchange.

 

7.3.  Procedure for Approval of Transfer.   If Tenant wishes to request Landlord’s consent to a Transfer, Tenant shall submit such request to Landlord, in writing, together with reasonably detailed financial information and information as to the identity and business information and business history of the proposed transferee, as well as the proposed effective date of the Transfer and the area or portion of the Premises which Tenant wishes to Transfer (the “Transfer Space”).  If Tenant’s request includes all of the information described in the immediately preceding sentence and Landlord fails to respond or request additional information from Tenant within sixty (60) days after receipt of Tenant’s proper request for approval, then Tenant shall submit an additional request to Landlord, setting forth the same information and further notifying Landlord on such request, on a covering letter in all capital letters and bold-face type, that Landlord’s failure to respond or request additional information from Tenant within an additional ten (10) business days shall be deemed an approval (such notice is hereinafter referred to as an “Automatic Approval Notice”).  If Landlord fails to respond or request additional information from Tenant within such additional ten (10) business days, such failure to so respond shall be deemed a consent to the Transfer. If Landlord requests additional information, Landlord shall respond within the later of (i) ten (10) business days after receipt of all requested information, or (ii) the expiration of the sixty (60) day period set forth above; and Landlord’s failure to do so shall be deemed a consent to the Transfer so long as such additional information shall include (on a covering letter in all capital letters and in bold-face type) an Automatic Approval Notice.  If Landlord consents to any such Transfer, such consent shall be given on Landlord’s form of consent (which consent shall include, among other things, an acknowledgment by the transferee that its rights arise through and are limited by the Lease, that the transferee agrees to comply with the Lease (with such exceptions as may be consented to 

 

 

  

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by Landlord), and a written acknowledgment by Tenant evidencing that Tenant is not released from its obligations under this Lease), which consent document shall be executed by Tenant and the transferee of Tenant.  It shall nevertheless be a condition to the deemed effectiveness thereof that Landlord be furnished with a fully executed copy of the full documentation governing the Transfer, in the form and substance approved by Landlord, and that Tenant shall pay Landlord’s expenses (including, without limitation, the Transfer Fee) in connection with the proposed Transfer.  It shall not be unreasonable for Landlord to object to Transfer document provisions which, inter alia, attempt to make Landlord a party to the Transfer document or impose any obligation on Landlord to the subtenant.

 

7.4.  Recapture.  Upon receipt of Tenant’s request for consent to a proposed Transfer, Landlord may elect to recapture the Transfer Space.  Landlord’s election to recapture must be in writing and delivered to Tenant within thirty (30) days of Landlord’s receipt of Tenant’s request for permission to transfer all or a portion of the Premises.  Landlord’s election to recapture must be in writing (a “Recapture Notice”) and delivered to Tenant within fifteen (15) business days of Landlord’s receipt of Tenant’s request for permission to Transfer all or a portion of the Premises.  In the event that Landlord notifies Tenant that it elects to recapture the Transfer Space, Tenant shall have the right to withdraw its consent request by providing written notice thereof to Landlord within five (5) days after Landlord delivers a Recapture Notice, in which event both Tenant’s request for consent and Landlord’s Recapture Notice shall be deemed null and void.  Landlord’s recapture shall be effective (the “Effective Date”) on a date selected by Landlord, which date shall be (i) on or before the date which is thirty (30) days after the proposed effective date of the Transfer, as specifically set forth in Tenant’s written request to Landlord for consent to a proposed Transfer, or (ii) if Tenant’s written request to Landlord for consent to a proposed Transfer does not contain a proposed effective date, then on or before the date which is thirty (30) days after Landlord’s election to recapture the Transfer Space; and with respect to the Transfer Space, this Lease shall be terminated and Tenant shall be released under this Lease, subject to any continuing liabilities or obligations of Tenant which remain delinquent or uncured with respect to the period prior to the Effective Date.  Landlord’s right to recapture the Transfer Space pursuant to this Section 7.4 shall not apply to Transfers between Tenant and its Affiliate pursuant to Section 7.6 below.

 

7.5.  Conditions.  In the event Landlord consents to a Transfer of all or any portion of the Premises, Landlord may condition its consent, inter alia, on agreement by Tenant and its assignee and/or subtenant, as the case may be, that fifty percent (50%) of any rental payable under such Transfer arrangement which exceeds the amount of rental payable hereunder be payable to Landlord (after deduction by Tenant for the reasonable and necessary costs associated with such Transfer amortized over the remaining term of the Lease) as consideration of the granting of such consent.  Nothing herein shall, however, be deemed to be a consent by Landlord of any Transfer or a waiver of Landlord’s right not to consent to any Transfer.  Any purported Transfer not in accordance with the terms hereof shall at Landlord’s option, to be exercised at any time after Landlord becomes aware of any such purported Transfer, be void, and may at Landlord’s option be treated as an event of default hereunder.

 

7.6.  Special Conditions for Transfers to Affiliates of Tenant. Notwithstanding anything to the contrary set forth above, Tenant shall be permitted without Landlord’s prior written consent and without being subject to recapture under Section 7.4 above, but subject to the 

 

 

  

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terms of this subparagraph 7.6, to transfer all or a portion of the Premises to an “Affiliate” of Tenant.  For purposes of this subparagraph, “Affiliate” shall mean: (i) the entity which owns fifty percent (50%) or more of Tenant’s outstanding common stock, general or limited partnership interest, or other legal or beneficial ownership interest of Tenant (the “Parent Company” ), or (ii) an entity which has fifty percent (50%) or more of its outstanding common stock, general or limited partnership interest, or other legal or beneficial ownership interest owned by Tenant or the Parent Company, or (iii) an entity which, pursuant to applicable state law, is the surviving entity in a merger, consolidation or reorganization involving Tenant.  The effectiveness of such Transfer to an Affiliate of Tenant shall nevertheless be conditioned on the following: (a) Landlord receiving a fully executed copy of the full documentation governing the Transfer, in the form and substance approved by Landlord, and (b) such subtenant shall acknowledge that its rights arise through and are limited by the Lease, and shall agree to comply with the Lease (with such exceptions as may be consented to by Landlord), and (c) a written acknowledgment by Tenant evidencing that Tenant is not released from its obligations under this Lease.

 

7.7.  No Release.  Notwithstanding any assignment of this Lease or subletting of all or part of the Premises, whether or not Landlord’s consent is required and/or obtained, the entity specifically named as the “Tenant” in the introductory paragraph of this Lease, and each and every applicable successor-in-interest to such named Tenant, shall be and remain fully liable under all of the terms and provisions of this Lease except in the event Landlord exercises its recapture right set forth in Section 7.4 (in which event Tenant shall be released from liability only as to the Transfer Space from and after the Effective Date).

 

8. Fire or Other Casualty.  In case of damage to the Premises or those portions of the Building providing access or essential services thereto, by fire or other casualty including but not limited to “force majeure” (as defined below), Landlord shall, at its expense, cause the damage to be repaired to a condition as nearly as practicable to that existing prior to the damage, with reasonable speed and diligence, subject to delays which may arise by reason of adjustment of loss under insurance policies, Governmental Requirements, and for delays beyond the control of Landlord, including a “force majeure” (as defined below). Landlord shall not, however, be obligated to repair, restore, or rebuild any of Tenant’s property or any alterations or additions made by or on behalf of Tenant.  Landlord shall not be liable for any inconvenience or annoyance to Tenant, or Tenant’s visitors, or injury to Tenant’s business resulting in any way from such damage or the repair thereof except, to the extent and for the time that the Premises are thereby rendered untenantable, the rent shall proportionately abate. In the event the damage shall involve the Building generally and shall be so extensive that Landlord shall decide, at its sole discretion, not to repair or rebuild the Building, or if the casualty shall not be of a type insured against under standard fire policies with extended type coverage, or if the holder of any mortgage, deed of trust or similar security interest covering the Building shall not permit the application of adequate insurance proceeds for repair or restoration, this Lease shall, at the sole option of Landlord, exercisable by written notice to Tenant given within sixty (60) days after Landlord is notified of the casualty and to the extent thereof, be terminated as of a date specified in such notice (which shall not be more than ninety [90] days thereafter), and the rent (taking into account any abatement as aforesaid) shall be adjusted to the termination date and Tenant shall thereupon promptly vacate the Premises.

 

 

  

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9. Regarding Insurance and Liability.

 

9.1.  Damage in General.  Tenant agrees that Landlord and its Building manager and their respective partners, officers, employees and agents shall not be liable to Tenant, and Tenant hereby releases such parties, for any personal injury or damage to or loss of personal property in the Premises from any cause whatsoever except to the extent that such damage, loss or injury is the result of the gross negligence or willful misconduct of Landlord, its Building manager, or their partners, officers, employees or agents.  Landlord and its Building manager and their partners, officers or employees shall not be liable to Tenant for any such damage or loss whether or not the result of their gross negligence or willful misconduct to the extent Tenant is compensated therefor by Tenant’s insurance or, if Tenant fails to maintain the insurance required in Section 9.3 below, to the extent Tenant would have been compensated had Tenant carried such insurance. Notwithstanding anything contained in this Lease to the contrary, in no event shall Landlord, its Building manager, or their partners, officers, employees or agents be liable to Tenant or any other party for any lost profits, lost business opportunities or consequential, punitive or exemplary damages (regardless of foreseeability).

 

9.2.  Indemnity.

 

(i) Subject to Paragraph 9.4 below, Tenant shall defend, indemnify and save harmless Landlord and its agents and employees against and from all liabilities, obligations, damages, penalties, claims, suits, demands, costs, charges and expenses, including reasonable attorneys’ fees, which may be imposed upon or incurred by or asserted against Landlord and/or its agents or employees by reason of any of the following which shall occur during the term of this Lease, or during any period of time prior to the Commencement Date hereof or after the expiration date hereof when Tenant may have been given access to or possession of all or any part of the Premises:

 

(a) any work or act done in, on or about the Premises or any part thereof at the direction of Tenant, its agents, contractors, subcontractors, servants, employees, licensees or invitees, except if such work or act is done or performed by Landlord or its agents or employees;

 

(b) any negligence or other wrongful act or omission on the part of Tenant or any of its agents, contractors, subcontractors, servants, employees, subtenants, licensees or invitees;

 

(c) any accident, injury or damage to any person (including Tenant’s employees and agents) or property occurring in, on or about the Premises or any part thereof, except only to the extent that such accident, injury or damage is caused solely by the gross negligence or willful misconduct of Landlord, its employees or agents; and

 

(d) any failure on the part of Tenant to perform or comply with any of the covenants, agreements, terms, provisions, conditions or limitations contained in this Lease on its part to be performed or complied with.

 

 

  

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Tenant’s indemnity obligations as aforesaid shall not be limited or affected by the provisions of any Worker’s Compensation Acts, disability benefits acts or other employee benefits acts or similar acts or statutes.

 

(ii)   In the event of a third party claim which is subject to indemnification by Tenant pursuant to this Lease, Landlord shall notify Tenant of such claim in writing within a reasonable time period after its receipt of notice of such claim.  The failure of Landlord to notify Tenant promptly after receipt of notice of the claim shall not, however, preclude Landlord from seeking indemnification hereunder except to the extent such failure has materially prejudiced the ability of Tenant to defend such claim or has caused Tenant to suffer actual loss, in which case such Tenant’s obligations hereunder shall be reduced by the amount of such actual loss.  Tenant shall promptly defend such claim by counsel selected by Tenant or its insurance carrier, and reasonably approved by Landlord, and Landlord shall cooperate with Tenant in the defense of such claim, including entering into a settlement of the matter on any reasonable basis proposed by Tenant and consented to by Landlord, which consent shall not be unreasonably withheld, provided that (a) Tenant shall be responsible for all costs and expenses of such settlement, and (b) in no event will Landlord be required to accept any settlement under which it is required to admit liability or to undertake any non-monetary executory obligations unless approved by Landlord in its sole and absolute discretion.  The foregoing notwithstanding, Landlord shall have the right to retain its own separate counsel in connection with the defense of any such claim, provided that any such separate representation shall be at Landlord’s sole cost and expense unless either (A) Tenant fails, within a reasonable time period after notice of a claim (which shall in no event be later than ten (10) business days prior to the due date for the initial responsive pleading required to be filed by Landlord in any legal action brought in connection with such claim) to defend Landlord (in which event Landlord shall be entitled to undertake the defense, compromise or settlement of such claim, and retain its own legal counsel, at the expense of and for the account and risk of, Tenant), or (B) there is a conflict of interest between Landlord and Tenant which precludes the joint representation of both parties by a single legal counsel under applicable principles of legal ethics without the discretionary consent of both parties (in which event Tenant shall pay all legal expenses, including without limitation reasonable attorneys fees, incurred by Landlord in retaining separate counsel to represent Landlord in such matter).  Landlord shall provide access, at any reasonable time, to such information relating to the matter which is subject to such indemnification as is within Landlord’s possession, custody or control, to the extent necessary for Tenant to conduct such defense.

 

(iii) Landlord shall defend, indemnify and save harmless Tenant and its agents and employees against and from all liabilities, obligations, damages, penalties, claims, suits, demands, costs, charges and expenses, including reasonable attorneys’ fees, which may be imposed upon or incurred by or asserted against Tenant and/or its agents or employees by reason of any of the following which shall occur during the term of this Lease:

 

(a) any gross negligence or willful misconduct on the part of Landlord, its employees or agents; and

 

(b) any accident, injury or damage to any person or property occurring in an area in the Building under the exclusive occupancy, custody and control of 

 

 

  

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Landlord, except to the extent that such accident, injury or damage is caused by the  negligence or willful misconduct of Tenant, its employees or agents;

provided, however, that Landlord shall not be liable for and shall not indemnify and protect Tenant with respect to any losses associated with Tenant’s lost business opportunities, lost profits, business losses or any consequential, punitive or exemplary damages.  The foregoing indemnity by Landlord shall only apply to liabilities, obligations, damages, penalties, claims, costs, charges and expenses, including reasonable attorneys’ fees, to the extent the same are not covered by the insurance Tenant is required to carry hereunder (provided, however, that if Tenant fails in any respect to secure and maintain the insurance required in Section 9.3 below, Landlord shall not be liable for any losses, costs, damages or expenses incurred or suffered by Tenant regardless of cause).

 

9.3.  Tenant’s Insurance. At all times during the term hereof, Tenant shall maintain in full force and effect with respect to the Premises and Tenant’s use thereof, commercial general liability insurance, naming Landlord, Landlord’s agent and Landlord’s mortgagee (and such other parties as Landlord may request) as additional insureds, covering injury to persons in amounts at least equal to $2,000,000.00 per occurrence and $2,000,000.00 general aggregate.  In addition to commercial general liability insurance, Tenant shall also be responsible, at Tenant’s own cost, to keep and maintain (i) insurance in respect of and covering Tenant’s own furniture, furnishings, equipment and other personal property, and all improvements made by or on behalf of Tenant, all insured for the replacement cost thereof, against all risks and hazards, including but not limited to sprinkler and leakage damage, and theft (collectively, “Personal Property Insurance”), and (ii) workers’ compensation insurance with respect to and covering all employees and agents of Tenant.  With respect to Tenant’s commercial general liability insurance and Personal Property Insurance, (i) no insurance coverage shall contain a deductible in excess of $50,000.00  without the prior written consent of Landlord, (ii) all deductibles shall be paid by Tenant, assumed by Tenant, for the account of Tenant, and at Tenant’s sole risk, (iii) Tenant’s insurer shall be licensed or authorized to do business in the State of New Jersey and shall have a policyholder rating of at least A- and be assigned a financial size category of at least Class IX as rated in the most recent edition of “Best’s Key Rating Guide” for insurance companies or a rating of at least AA as rated by Standard & Poor’s, (iv) such insurance coverage provided shall be endorsed to be primary to any and all insurance carried by Landlord, with Landlord’s insurance being excess, secondary and non-contributing, (v) Landlord, Landlord’s manager of the Building and all holders of a deed to secure debt or other such security instrument and the landlord under any underlying lease shall be an additional insured on all such policies, and (vi) all policies of liability insurance specified in this Lease shall specifically insure Tenant’s contractual liability under this Lease. Tenant shall also carry, at Tenant’s own cost and expense, such other insurance, in amounts and for coverages and on such other terms as Landlord may from time to time deem commercially reasonable and appropriate and which landlord’s in the Princeton market are then requiring.   Tenant assumes all risk of loss of any or all of its personal property not otherwise caused by Landlord’s gross negligence, malicious or willful acts or ommissions.  Each of the foregoing policies shall require the insurance carrier to give at least thirty (30) days prior written notice to Landlord and to any mortgagee named in an endorsement thereto of any cancellation, material modification or non-renewal thereof, and each such policy shall be issued by an insurer and in a form satisfactory to Landlord.  Tenant shall lodge with Landlord at or prior to the commencement date of the term 

 

 

  

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here0f evidence of the insurance required hereunder acceptable to Landlord, together with evidence of paid-up premiums, which evidence shall include, if required by Landlord, a duplicate original of such commercial general liability insurance policy, certificates of insurance for Personal Property Insurance and such workers’ compensation insurance, and duplicate originals or certificates of such insurance that Landlord may require Tenant to carry from time to time, and shall lodge with Landlord renewals thereof at least fifteen (15) days prior to expiration.

 

9.4.  Release and Waiver of Subrogation. Each Party hereto hereby waives and releases any and every claim which arises or which may arise in its favor and against the other Party hereto during the term of this Lease or any extension or renewal thereof for any and all loss of, or damage to, any of its property located within or upon or constituting a part of the Building, to the extent that such loss or damage is recovered under an insurance policy or policies (or would have been recovered under the insurance required to be obtained by the waiving Party pursuant to this Lease, regardless of whether such insurance was, in fact, obtained) and to the extent such policy or policies contain provisions permitting such waiver of claims without invalidating all or any part of the coverage afforded thereby.  Each Party shall cause its insurers to issue policies containing such provisions.

 

9.5.  Limitation on Personal Liability.  Anything in this Lease, either expressed or implied, to the contrary notwithstanding,  Parties acknowledge and agree that each of the covenants, undertakings and agreements herein made on the part of Landlord and Tenant, while in form purporting to be covenants, undertakings and agreements of the respective parties to this lease personally, are, nevertheless, made and intended not as personal covenants, undertakings and agreements of the respective party, or for the purpose of binding such party personally or the assets of such party, except Landlord’s equity interest in the Building; and that no personal liability or personal responsibility is assumed by, nor shall at any time be asserted or enforceable against either party, any member, manager or partner of Parties, any parent or subsidiary of  Parties or any parent, subsidiary or partner of any partner of the Parties, or any of their respective heirs, personal representatives, successors and assigns, or officers or employees on account of this Lease or on account of any covenant, undertaking or agreement of the Parties in this Lease contained, all such personal liability and personal responsibility, if any, being expressly waived and released by each Party.  In furtherance of the foregoing, if a Party fails to perform any provision of this Lease which the Party is obligated to perform, and as a consequence of such failure, Tenant shall recover a money judgment against Landlord, such judgment shall be satisfied only (i) out of the proceeds of sale received upon levy against the right, title and interest of Landlord in the building, and/or (ii) to the extent not encumbered by a secured creditor, out of the rents or other incomes receivable by Landlord from the building; or in such instance as Landlord shall recover a money judgment against Tenant, such judgment shall be satisfied only out of the proceeds and assets of the Tenant and shall not be satisfied out of any personal holdings or assets of any affiliates, agents or employees of tenant.

 

9.6.  Successors in Interest to Landlord, Mortgagees.  The term “Landlord” as used in this Lease means, from time to time, the fee owner of the Building, or, if different, the

 

 

 

  

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party holding and exercising the right, as against all others (except space tenants of the Building) to possession of the entire Building.  Landlord as above-named represents that it is the holder of such rights as of the date hereof. In the event of the voluntary or involuntary transfer of such ownership or right to a successor-in-interest of Landlord (“Successor Landlord”), Landlord shall be freed and relieved of all liability and obligation hereunder which shall thereafter accrue (provided the Successor Landlord agrees to assume such liability and obligations) and Tenant shall look solely to such Successor Landlord for the performance of the covenants and obligations of the Landlord hereunder which shall thereafter accrue; provided, however, that Landlord shall not be relieved of liability for claims by Tenant which accrued prior to the transfer of ownership to a Successor Landlord and for which Successor Landlord does not assume liability.  The liability of any such Successor Landlord under or with respect to this Lease shall be strictly limited to and enforceable only out of its or their interest in the Building and Property, and shall not be enforceable out of any other assets.  No Mortgagee or Ground Lessor (as defined in Paragraph 13.1) which shall become a Successor Landlord hereunder (either in terms of ownership or possessory rights) shall:  (i) be liable for any previous act or omission of a prior Landlord, (ii) be bound by any amend­ment or modification of this Lease, or any waiver of the terms of this Lease made without its written consent (if such consent is required pursuant to the loan agreements between Landlord and its Mortgagee and/or the Ground Lease), provided that Landlord upon Tenant’s written request shall obtain such consent and furnish a copy of same to Tenant prior to entering into any amendment or modification of this Lease, or any waiver of the terms of this Lease and if Tenant does not make such request of Landlord, Tenant shall be deemed to have waived such condition and Landlord may, if necessary, execute the amendment or modification prior to obtaining consent,(iii) be liable for any construction of the improvements to be made to the Premises, or for any allowance or credit to Tenant for rent, construction costs or other expenses, (iv) be liable for any security deposit not actually received by it, (v) be subject to any right of Tenant to any offset, defense, claim, counterclaim, reduction, deduction, or abatement against Tenant’s payment of rent or performance of Tenant’s other obligations under this Lease, arising (whether under this Lease or under applicable law) from Landlord’s breach or default under this Lease (“Offset Right”) that Tenant may have against Landlord or any other party that was landlord under this Lease at any time before the occurrence of any attornment by Tenant  (“Former Landlord”) relating to any event or occurrence before the date of attornment, including any claim for damages of any kind whatsoever as the result of any breach by Former Landlord that occurred before the date of attornment, (vi) be required to reconstruct or repair improvements following a fire, casualty or condemnation, (vii) be subject to any offset, defense, claim, counterclaim, reduction, deduction, or abatement arising from representations and warranties related to Former Landlord, (viii) be bound by any consensual or negotiated surrender, cancellation, or termination of the Lease, in whole or in part, agreed upon between Landlord and Tenant, unless effected unilaterally by Tenant pursuant to the express terms of the Lease, (ix) be bound by any payment of rent that Tenant may have made to Former Landlord more than thirty (30) days before the date such rent was first due and payable under the Lease with respect to any period after the date of attornment other than, and only to the extent that, the Lease expressly required such a prepayment; or (x) be liable to pay Tenant any sum(s) that any Former Landlord owed to Tenant unless such sums, if any, shall have been actually delivered to Mortgagee by way of an assumption of escrow accounts or otherwise. The foregoing shall not limit either (a) Tenant’s right to exercise against Successor Landlord any Offset Right otherwise available to Tenant because of events occurring 

 

 

  

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after the date of attornment or (b) Successor Landlord’s obligation to correct any conditions that existed as of the date of attornment and violate Successor Landlord’s obligations as landlord under this Lease.  Subject to the foregoing, the provisions hereof shall be binding upon and inure to the benefit of the successors and assigns of Landlord.

 

9.7.  Survival.  The provisions of this Paragraph 9 shall survive the expiration or sooner termination of this Lease.

 

10. Eminent Domain.  If the whole or a substantial part of the Building shall be taken or condemned for public or quasi-public use under any statute or by right of eminent domain or private purchase in lieu thereof by any competent authority, Tenant shall have no claim against Landlord and shall not have any claim or right to any portion of the amount that may be awarded as damages or paid as a result of any such condemnation or purchase; and all right of the Tenant to damages therefor are hereby assigned by Tenant to Landlord. The foregoing shall not, however, deprive Tenant of any separate award for moving expenses, business dislocation damages or for any other award which would not reduce the award payable to Landlord.  Upon the date the right to possession shall vest in the condemning authority, this Lease shall, at the option of Landlord (or, only in the case of condemnation or taking of the entire Building or such partial taking as results in the untenantability of the Premises, at the option of Tenant), cease and terminate with rent adjusted to such date and Tenant shall have no claim against Landlord for the value of any unexpired term of this Lease.

 

11. Insolvency. Each of the following shall constitute an event of default by Tenant under this Lease, upon the occurrence of any such event of default Landlord shall have, without need of any notice, the rights and remedies enunciated in Paragraph 12 of this Lease for events of default hereunder: (i) the commencement of levy, execution or attachment proceedings against Tenant, any principal (which shall be defined as any individual or entity having a direct or indirect ownership interest in Tenant of more than 25%) thereof or any partner therein or any surety or guarantor thereof (hereinafter a “Surety”) or any of the assets of Tenant, or the application for or appointment of a liquidator, receiver, custodian, sequester, conservator, trustee, or other similar judicial officer; or (ii) the insolvency, under either the bankruptcy or equity definition, of Tenant or any principal thereof or partner therein or any Surety; or (iii) the assignment for the benefit of creditors, or the admission in writing of an inability to pay debts generally as they become due, or the ordering of the winding-up or liquidation of the affairs of Tenant or any principal thereof or partner therein or any Surety; or (iv) the commencement of a case by or against Tenant or any principal thereof or partner therein or any Surety under any insolvency, bankruptcy, creditor adjustment, debtor rehabilitation or similar laws, state or federal, or the determination by any of them to request relief under any insolvency, bankruptcy, creditor adjustment, debtor rehabilitation or similar proceeding, state or federal, including, without limitation, the consent by any of them to the appointment of or taking possession by a receiver, liquidator, assignee, trustee, custodian, sequester or similar official for it or for any of its respective property or assets (unless, in the case of involuntary proceedings, the same shall be dismissed within ninety (90) days after institution).

 

 

 

 

  

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12. Default.

 

12.1.  Events of Default by Tenant.  If Tenant fails to pay rent or any other sums payable to Landlord hereunder when due and such default shall continue for seven (7) days after receipt of notice from Landlord [provided, however, that Landlord shall not be required to give any such notice more than three times within any twelve (12) month period], or if Tenant shall fail to perform or observe any of the other covenants, terms or conditions contained in this Lease within fifteen (15) days (or such longer period as is reasonably required to correct any such default, provided Tenant promptly commences and diligently continues to effectuate a cure [but in all events within ninety (90) days]) after receipt of written notice thereof by Landlord; provided, however, that Landlord shall not be required to give any such notice more than twice within any twelve (12) month period then, and in any of such cases (notwithstanding any former breach of covenant or waiver thereof in a former instance), each of the foregoing shall be an “Event of Default”).  The events hereinafter enumerated shall also be deemed Events of Default under this Lease, without any notice, grace or cure period (except as otherwise stated): (a) if any of the events specified in Paragraph 11 occur, or (b) if Tenant shall fail, within two (2) business days after notice from Landlord, to substantiate to Landlord Tenant’s satisfaction of its insurance requirements under this Lease at or prior to the Commencement Date or at any time during the term hereof, in accordance with the provisions of Paragraph 9.3 above, or (c) if Tenant is a retail tenant or if Tenant occupies space on the same floor as the main lobby of the Building or space facing onto the main lobby of the Building and Tenant vacates or abandons the Premises during the term hereof or removes or manifests an intention to remove any of Tenant’s goods or property therefrom other than in the ordinary and usual course of Tenant’s business, or (d) if any corporate surety or guarantor of this Lease merges with another entity, or liquidates or dissolves or changes control or if any surety or guarantor of this Lease fails to comply with any of the provisions of its suretyship or guaranty agreement, then, and in any of such cases (notwithstanding any former breach of covenant or waiver thereof in a former instance), Landlord, in addition to all other rights and remedies available to it by law or equity or by any other provisions hereof, may at any time thereafter, without further notice, have the option to pursue any one or more of the remedies set forth in Paragraph 12.2, at law or in equity.

 

12.2.  Remedies.  Upon the occurrence of any Event of Default by Tenant, Landlord shall have the option to pursue any one or more of the following remedies, without further notice to Tenant:

 

(i) Landlord,  may, without prejudice to any other remedy Landlord may have for possession, arrearages in rent or damages for breach of contract or otherwise, and at any time thereafter reenter the Premises and expel or remove therefrom Tenant and all persons and entities claiming by or through Tenant (including, without limitation, any and all subtenants and assignees) and all property belonging to or placed on the Premises by, at the direction of or with the consent of Tenant or its assignees or subtenants, by force if necessary, without being liable to prosecution or any claim for damages therefor; and Tenant agrees to indemnify Landlord for all loss and damage which Landlord may suffer by reason of such reentry.  Any demand, reentry and taking possession of the Premises by Landlord shall not of itself constitute an acceptance by Landlord of a surrender of this Lease or of the Premises by Tenant and shall not of itself constitute a termination of this Lease by Landlord;

 

 

  

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(ii) Landlord, may, at any time thereafter relet the Premises or any part thereof for such time or times, at such rent or rents and upon such other terms and conditions as Landlord in its sole discretion may deem advisable, and Landlord may make any alterations or repairs to the Premises which it may deem necessary or proper to facilitate such reletting; and Tenant shall pay all costs of such reletting including, but not limited to, the cost of any such alterations and repairs to the Premises, attorneys’ fees and brokerage commissions; and if this Lease shall not have been terminated, Tenant shall continue to pay all rent and all other charges due under this Lease up to and including the date of beginning of payment of rent by any subsequent tenant of part or all of the Premises, and thereafter Tenant shall pay monthly during the remainder of the term of this Lease the difference, if any, between the rent and other charges collected from any such subsequent tenant or tenants and the rent and other charges reserved in this Lease, but Tenant shall not be entitled to receive any excess of any such rents collected over the rent reserved herein;

 

(iii) Landlord, with or without terminating this Lease, may recover from Tenant all damages and expenses Landlord suffers or incurs by reason of Tenant’s default, including, without limitation, costs of recovering the Premises, attorneys’ fees and any unamortized value of Tenant Improvements and brokerage commissions, all of which shall be immediately due and payable by Tenant to Landlord immediately upon demand;

 

(iv) Landlord may immediately or at any time thereafter terminate this Lease, and this Lease shall be deemed to have been terminated ten (10) days after receipt by Tenant of written notice of such termination.  Notwithstanding any termination of this Lease by Landlord, Tenant’s obligation to pay rent and other charges and damages as provided for under each subsection of this Section 12.2 shall continue in full force and effect (and shall survive such termination), provided that, upon such termination, at Landlord’s sole option (and in substitution for the rent-based damages otherwise recoverable by Landlord pursuant to subsection 12.2(ii), above), Landlord shall have the right to recover from Tenant, as liquidated rent damages, the following:

 

(a) the worth, at the time of the award, of the unpaid rent that has been earned at the time of termination of this Lease; and

 

(b) the worth, at the time of the award, of the amount by which the unpaid rent that would have been earned after the date of termination of this Lease until the time of the award exceeds the amount of rent that could have been reasonably obtained by Landlord using reasonable diligence to relet the Premises; and

 

(c) the worth, at the time of the award, of the amount by which the unpaid rent for the balance of the Lease Term (including the then current extension period if applicable) after the time of the award exceeds the amount of rent that could have been reasonably obtained by Landlord using reasonable diligence to relet the Premises.

 

The following words and phrases as used in this Paragraph 12.2(iv) shall have the following meanings:

 

 

 

  

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(x)           The “worth at the time of the award” as used in Paragraphs 12.2(iv)(a) and (b) shall be computed by allowing interest at the Default Rate.

 

(y)           The “worth at the time of the award” as used in Paragraph 12.2(iv)(c) shall be computed by discounting the amount at the discount rate of eight percent (8%) per annum; and

 

(z)           The term “time of the award” shall mean either the date upon which Tenant pays to Landlord the amount recoverable by Landlord as set forth above or the date of entry of any determination, order or judgment of any court or arbitration board, whichever first occurs.

 

(v) Landlord may, in its sole discretion, (without any waiver of such Event of Default and without any requirement of further notice to Tenant or opportunity to cure) immediately apply all or a portion of the Security Deposit to any or all of those obligations of Tenant due or to become due under this Lease.  In the event of any such application, Tenant shall deposit with Landlord the amount necessary to restore the Security Deposit to its full amount within five (5) business days after Landlord sends written notice to Tenant that it has applied all or a portion of the Security Deposit (and Tenant’s failure to restore the Security Deposit to its full amount within such five (5) business day period shall constitute an automatic Event of Default without requiring any further notice or opportunity to cure).

 

12.3.  No Duty to Relet.  Landlord shall in no event be responsible or liable for any failure to relet the Premises or any part thereof, or for any failure to collect any rent due upon a reletting, except to the extent of Landlord’s obligations under law.  Without limiting the foregoing general statement of Landlord’s rights in such regard,  Landlord shall have no obligation to relet all or any portion of the Premises in preference or priority to any other space Landlord may have available for rent or lease elsewhere.

 

12.4.  Bankruptcy.  In the event of a voluntary or involuntary Chapter 11 or 7 bankruptcy filing by or against Tenant, Tenant shall not seek to extend the time to assume or reject this Lease (under Section 365(d)(4) of the Bankruptcy Code) to a date which is more than one hundred twenty (120) days subsequent to the filing date.  Nothing contained in this Lease shall limit or prejudice the right of Landlord to prove for and obtain as damages incident to a termination of this Lease, in any bankruptcy, reorganization or other court proceedings, the maximum amount allowed by any statute or rule of law in effect when such damages are to be proved.

 

12.5.  Waiver of Defects.  Tenant hereby waives all errors and defects of a procedural nature in any proceedings brought against it by Landlord under this Lease and further waives the right to impose any counterclaim of any nature or description which is not directly related to this Lease in any such proceeding.  Tenant further waives any notices to quit as may be required by applicable New Jersey law, as the same may have been or may hereafter be amended, and agrees that the notices provided in this Lease shall be sufficient in any case where a longer period may be statutorily specified.  The acceptance by Landlord of any partial payment(s) by or for Tenant hereunder shall not constitute Landlord’s acceptance of such payment(s) as a satisfaction of Tenant’s payment obligation (notwithstanding any statement to 

 

 

  

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the contrary on any correspondence accompanying such payment(s) and/or note(s) written on any check).

 

12.6.  Non-Waiver by Landlord.  The failure of Landlord to insist in any one or more instances upon the strict performance of any one or more of the agreements, terms, covenants, conditions or obligations of this Lease, or to exercise any right, remedy or election herein contained, shall not be construed as a waiver or relinquishment in the future of such performance or exercise, but the same shall continue and remain in full force and effect with respect to any subsequent breach, act or omission.

 

12.7.  Partial Payment.  No payment by Tenant or receipt by Landlord of a lesser amount than the correct Minimum Rent or additional rent due hereunder shall be deemed to be other than a payment on account, nor shall any endorsement or statement on any check or any letter accompanying any check or payment be deemed to effect or evidence an accord and satisfaction, and Landlord may accept such check or payment without prejudice to Landlord’s right to recover the balance or pursue any other remedy in this Lease or at law provided.

 

12.8.  Overdue Payments.  If any payment required to be made by Tenant to Landlord under this Lease shall not have been received by Landlord by 5:00 pm local time on the fifth (5th) business day after the date such payment is due, then (i) in addition to such payment, and in order to partially compensate Landlord for the extra expense incurred in the handling of overdue payments, Tenant shall pay Landlord a late fee equal to the greater of (a) five percent (5%) of such overdue payment, or (b) five hundred dollars ($500); and (ii) such overdue payment shall bear interest, from the date such overdue payment was due until it is paid, at the higher of (a) five percent (5%) above the highest prime rate published in the Wall Street Journal, if available (and, if not available, then such comparable substitute rate as may be selected by Landlord), from time to time, and (b) the rate of eighteen percent (18%) per annum (or, if lower, the highest legal rate); provided, however, that if on two (2) occasions in any calendar year a payment required to be made by Tenant to Landlord shall not have been received by Landlord by 5:00 pm local time on the date such payment is due, then, and for the remainder of the calendar year, Tenant shall not be entitled to the five (5) business day grace period set forth above in this Paragraph, and the late fee shall be charged, and interest shall commence to accrue, if a payment is not received by Landlord by 5:00 pm local time on the date such payment is due.  The late fee and interest set forth in this Paragraph shall not affect any other right or remedy available to Landlord as a result of a failure by Tenant to make any payment as required under this Lease.

 

12.9.  Security Interest.  Landlord may exercise all remedies granted a “Secured Party” under the New Jersey Uniform Commercial Code.  Landlord shall have a lien upon all goods, chattels or personal property of any description belonging to Tenant which are placed in, or become a part of, the Premises, as security for the performance by Tenant of its obligations under this Lease, which lien shall not be in lieu of or in any way affect any statutory landlord’s lien given by law, but shall be cumulative thereto; and Tenant hereby grants to Landlord a security interest in all such property placed in the Premises.  In the event Landlord exercises its option to terminate this Lease, or to reenter and relet the Premises as provided herein following an Event of Default, Landlord may, at its option, take possession of all of Tenant’s property on the Premises and sell the same at public or private sale after giving Tenant reasonable notice of the time and place of any public sale, or of the time after which any private sale is to be made, 

 

 

  

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for cash or on credit, or for such prices and terms as Landlord deems best, with or without having the property present at such sale.  In addition, Landlord may, at its option, upon fifteen (15) days advanced notice, foreclose this lien in the manner and form provided by the foreclosure of security instruments or in any other manner permitted by law.  The proceeds of any such foreclosure or sale shall be applied first to the necessary and proper expense of removing, storing and selling such property, including applicable attorneys’ fees, then to the payment of any indebtedness, other than rent, due hereunder from Tenant to Landlord, including interest thereon, then to the payment of any rent or other sums due or to become due under this Lease, with the balance, if any, to be paid to Tenant.  Tenant shall at the request of Landlord, execute and deliver such additional documents as may be requested, including a Uniform Commercial Code Financing Statement(s) (Form 1), to perfect this security interest.

 

12.10.  Cumulative Remedies.  No right or remedy herein conferred upon or reserved to Landlord is intended to be exclusive of any other right or remedy herein or by law provided, but each shall be cumulative and in addition to every other right or remedy given herein or now or hereafter existing at law or in equity or by statute.

 

12.11.  WAIVER OF JURY TRIAL.  LANDLORD AND TENANT HEREBY WAIVE TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM BROUGHT BY EITHER OF THEM AGAINST THE OTHER ARISING OUT OF THIS LEASE, OR THE USE AND OCCUPANCY OF THE PREMISES.  TENANT HEREBY WAIVES THE RIGHT TO INTERPOSE ANY NON- MANDATORY COUNTERCLAIM IN ANY SUMMARY PROCEEDING BROUGHT BY LANDLORD AFTER AN EVENT OF DEFAULT, PROVIDED THAT (1) TENANT WILL NOT BE DEEMED TO HAVE WAIVED THE RIGHT TO ASSERT ANY SUCH NON-MANDATORY COUNTERCLAIM AS A DIRECT CLAIM AGAINST LANDLORD IN A SEPARATE ACTION AGAINST LANDLORD, AND (2) TENANT SHALL NOT SEEK TO CONSOLIDATE SUCH SEPARATE PROCEEDING WITH ANY SUCH SUMMARY PROCEEDING BROUGHT BY LANDLORD AGAINST TENANT.

 

12.12.  Landlord Default.  In the event Landlord fails to keep and perform any of the terms, covenants, conditions, agreements or provisions of this Lease, Tenant shall give written notice to Landlord and send a copy of such notice to the holder of any mortgage whose address Tenant has been notified of in writing.  Landlord shall have a period of thirty (30) days after receipt of such notice to cure such default; provided, however, if the nature of Landlord's obligation is such that more than thirty (30) days are required for its performance, then Landlord shall not be deemed in default if it commences performance within the thirty (30) day period and thereafter diligently pursues the cure to completion.  In the event of a default by Landlord which continues following the expiration of the notice and cure period, Tenant may, at its option (i) with prior written notice to Landlord, remedy such default or breach and be reimbursed the reasonable and actual costs thereof within thirty (30) days after Landlord’s receipt of a paid invoice and contractor’s lien waivers as applicable, therefor; (ii) pursue any other remedy available at law or in equity or (iii) pursue any other remedy expressly set forth in this Lease.  In no event may Tenant recover any special, consequential, indirect or punitive damages against or from Landlord.  Nothing contained in this Lease shall relieve Landlord of its duty to effect the repair, replacement, correction or maintenance required of it pursuant to this Lease, nor shall Landlord be relieved of its obligation to restore the affected services or utilities, and this 

 

 

  

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provision shall not be construed to obligate Tenant to undertake any such work. Anything herein to the contrary notwithstanding, in no event shall Tenant be entitled to perform any work that impacts the structural elements or exterior of the Building, any space leased to other tenants or any of the mechanical, life safety, plumbing or electrical systems serving the Building.  Further, Tenant agrees to indemnify, defend and hold harmless Landlord from and against any and all claims and liabilities of any kind and description which may arise out of or be connected in any way with Tenant’s exercise of its self-help rights set forth in this Paragraph 12.12. 

 

13. Subordination.

 

13.1.  General. This Lease and Tenant’s interest herein is and shall be subject and subordinate to all ground or underlying leases (whether any or all, hereinafter referred to as a “Ground Lease”) of the entire Building and to any and all mortgages, deeds to secure debt, deeds of trust and similar security instruments (whether any or all, hereinafter referred to as a “Mortgage”) which may hereafter be secured upon the Building (or upon the Property), and to all renewals, modifications, consolidations, replacements and extensions thereof.  This clause shall be self-operative and no further instrument of subordination shall be required by any lessor under any Ground Lease (a “Ground Lessor”) or holder of any Mortgage (a “Mortgagee”), but in confirmation of such subordination, Tenant shall, promptly upon written request, execute, acknowledge and deliver to Landlord or to any Ground Lessor or Mortgagee, any instrument or instruments that Landlord may reasonably request acknowledging such subordination.  Tenant shall, upon demand, at any time or times, execute, acknowledge and deliver to Landlord or to any Ground Lessor or Mortgagee, as applicable, without expense, any and all instruments that may be necessary to make this Lease superior to the lien or security title or interest of any Mortgage or Ground Lease.  If any Mortgagee or Ground Lessor, as applicable, or any other person or entity succeeding to the interests of such Mortgagee or Ground Lessor, shall hereafter succeed to the right of Landlord under this Lease, Tenant shall, at the option of such successor, attorn to and recognize such successor as Tenant’s landlord under this Lease without change in the provisions hereof and shall promptly execute and deliver any instrument that may be necessary to evidence such attornment.  Upon such attornment, this Lease shall continue in full force and effect as a direct lease between each successor Landlord and Tenant, subject to all of the terms, covenants and conditions of this Lease; provided, however, that such successor shall not be liable for or bound by (i) any payment of an installment of rent or additional rent which may have been made more than thirty (30) days before the due date of such installment, (ii) any amendment or modification to or termination of this Lease not in conformity with any such Mortgage or Ground Lease (if the successor landlord is the Mortgagee or Ground Lessor), provided that upon Tenant’s written request Landlord shall obtain such consent and furnish a copy of same prior to entering into any amendment or modification or termination of this Lease and if Tenant does not make such request of Landlord, Tenant shall be deemed to have waived such condition and Landlord may, if necessary, execute the amendment or modification or termination prior to obtaining the consent of Morgagee or Ground Lessor, as applicable, (iii) any act, omission or default by Landlord under this Lease (but such successor shall be subject to the continuing obligations of the Landlord hereunder first arising from and after such succession to the extent of such successor’s interest in the Building), provided, however, that Landlord shall not be relieved of liability for claims by Tenant which accrued prior to the transfer of ownership to a Successor Landlord and for which Successor Landlord does not assume liability or (iv) any credits, claims, counterclaims, setoffs or defenses which Tenant may have against Landlord, 

 

 

  

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except as expressly set forth in this Lease.  If Landlord shall so request, Tenant shall send to any Mortgagee or Ground Lessor of the Building designated by Landlord, a copy of any notice given by Tenant to Landlord alleging a material breach by Landlord in its obligations under this Lease.

 

13.2.  Rights of Mortgagees and Ground Lessors.  Tenant shall send to each Mortgagee of the Building or any part thereof (after notification of the identity of such Mortgagee and the mailing address thereof) copies of all notices that Tenant has provided to Landlord of any unresolved default by Landlord under this lease; such notices to said Mortgagee or Ground Lessor shall be sent concurrently with the sending of the notices to Landlord and in the same manner as notices are required to be sent pursuant to Paragraph 14 hereof.  Tenant will accept performance of any provision of this Lease by such Mortgagee and Ground Lessor as performance by, and with the same force and effect as though performed by, Landlord.  If any act or omission of Landlord would give Tenant the right, immediately or after lapse of a period of time, to cancel or terminate this Lease, or to claim a partial or total eviction, Tenant shall not exercise such right until (a) Tenant gives notice of such act or omission to Landlord and to each such Mortgagee and Ground Lessor of whom Landlord has previously notified Tenant, and (b) a reasonable period of time for remedying such act or omission elapses following the time when such Mortgagee or Ground Lessor becomes entitled to remedy same (which reasonable period shall in no event be less than the period to which Landlord is entitled under this Lease or otherwise, after similar notice, to effect such remedy and which reasonable period shall take into account such time as shall be required to institute and complete any foreclosure proceedings).

 

13.3.  Modifications. If, in connection with obtaining, continuing or renewing financing for which the Building, Property or the Premises or any interest therein represents collateral in whole or in part, a banking, insurance or other lender shall request insubstantial modifications of this Lease as a condition of such financing, Tenant will not unreasonably withhold, delay, condition or defer its consent thereto, provided that such modifications do not increase the monetary obligations of Tenant hereunder, change the business terms of this Lease or adversely affect to a material degree Tenant’s tenancy hereby created.

 

14. Notices.  All notices and other communications hereunder, to be effective, must be in writing (whether or not a writing is expressly required hereby), and must be either (i) hand delivered, or (ii) sent by a recognized national overnight courier service, fees prepaid, or (iii) sent by United States registered or certified mail, return receipt requested, postage prepaid, or (iv) sent by facsimile transmission (with a confirmation copy immediately to follow by any of the methods of delivery set forth above); in all of the foregoing cases to the following respective addresses:

 

14.1.  If to Landlord:

Princeton South Investors, LLC

c/o Rubenstein Partners

Cira Centre

2929 Arch Street

28th Floor

Philadelphia, Pennsylvania 19104-2868

Attention:  Eric G. Schiela

 

 

  

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      R. Bruce Balderson, Jr., Esq.

Fax:  (215) 563-4110

With a required copy simultaneously to:

RPO Property Management, LLC

c/o Rubenstein Partners

Cira Centre

2929 Arch Street

28th Floor

Philadelphia, Pennsylvania 19104-2868

Attention:  Craig G. Zolot

Fax:  (215) 563-4110

 

14.2.  If to Tenant:

Prior to the Commencement Date:

Antares Pharma, Inc.

Princeton Crossroads Corporate Center

250 Philips Blvd., Suite 290

Ewing, NJ 08618

Attention:  Robert Apple, CFO

Ahmed M.T. Riaz, Esq.

Fax:  (609) 359-3015

Following the Commencement Date:

Antares Pharma, Inc.

            Princeton South Corporate Center Condominium – Unit 1

100 Charles Ewing Boulevard

Ewing, New Jersey  08628

Attention:  CFO

Fax:  (609) 359-3015

With a required copy simultaneously to:

Morgan Lewis & Bockius LLP

1701 Market Street

Philadelphia, PA 19103-2921

Attn: Joanne R. Solsow, Esq.

Fax: (215) 963-2921

 

 

or at such other address or to the attention of such other person as either Party may hereafter give the other for such purpose (and either Party may, upon not less than five (5) business days’ prior written notice to the other, substitute and/or add new persons and/or addresses to which all 

 

 

 

 

  

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notices hereunder shall be directed).  Notices will be deemed to have been given (a) when so delivered (by hand delivery, courier service or facsimile transmission as aforesaid), or (b) three days after being so mailed (by registered or certified mail as aforesaid), but will in all events be deemed given no later than the date of actual receipt or refusal of delivery.  Tenant hereby appoints as an agent of Tenant to receive the service of all dispossessory or distraint proceedings and notices thereunder the person in charge of or occupying the Premises at the time, and, if no person shall be in charge of or occupying the same, then such service may be made by attaching the same on the main entrance of the Premises; provided a copy of such notice is provided to Tenant as required above.

 

15. Holding Over. Should Tenant continue to occupy the Premises after expiration of the Term of this Lease or any renewal or renewals thereof, or after a forfeiture or other termination thereof or of Tenant’s right of possession of the Premises, such tenancy shall (without limitation on any of Landlord’s rights or remedies therefor) be a tenancy-at-sufferance at a minimum monthly rent equal to 150% of the greater of (i) the sum of Minimum Rent and additional rent payable for the last month of the term of this Lease or, (ii) the fair market rental value at the time of such holdover, and, in addition to either of the foregoing, all other charges payable with respect to such last month of this Lease and all damages suffered or incurred by Landlord as a result of or arising from such holdover tenancy.  Nothing contained herein shall grant Tenant the right to holdover after the term of this Lease has expired, and if Tenant remains in possession of the Premises for longer than thirty (30) days after the Term expires or is otherwise terminated (or earlier than 30 days if Landlord notifies Tenant that a prospective tenant has expressed interest in the Premises), Tenant shall indemnify, defend and hold harmless Landlord from and against all losses, liabilities, costs and damages sustained by Landlord by reason of such retention of possession, including without limitation any termination or other loss of a lease for the Premises by a replacement tenant due to delay in delivery of the Premises to the new tenant.

 

16. Reservations in Favor of Landlord.  (i) All walls, windows and doors bounding the Premises (including exterior Building walls, core corridor walls and doors and any core corridor entrance), except the inside surfaces thereof, (ii) any terraces or roofs adjacent to the Premises, and (iii) any space in or adjacent to the Premises used for shafts, pipes, conduits, fan rooms, ducts, electric or other utilities, sinks or other Building facilities, and the use thereof, as well as reasonable access thereto through the Premises for the purposes of operation, maintenance, decoration and repair, are reserved to Landlord.

 

17. Completion of Tenant Improvements; Delay in Possession; Allowance.

 

17.1.  Performance of Tenant Improvements.  The responsibility for costs, preparation of preliminary and final plans, working drawings and specifications, bidding process, contracting, payment arrangements, and all other undertakings with respect to the design and performance of “Tenant Improvements”, and the timing and mechanics thereof and therefor, including Landlord’s and Tenant’s respective consent and approval rights related thereto, are all as set forth herein and in Exhibit “F” attached hereto and made a part hereof.

 

17.2.  Acceptance.  Tenant represents that the Building, Property, and the Premises, the street or streets, sidewalks, parking areas, curbs and access ways adjoining them, and the 

 

 

  

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present uses and non-uses thereof, have been examined by Tenant, and Tenant accepts them in the condition or state in which they are as of the Execution Date of this Lease, without relying on any representation, covenant or warranty, express or implied, by Landlord, except as may be expressly contained herein with respect to Tenant Improvements to be constructed in the Premises.  The provisions of this paragraph shall survive the termination of this Lease.

 

17.3.  Delay in Possession.  If Landlord shall be unable to deliver possession of the Premises to Tenant by the Target Commencement Date (i) because a certificate of occupancy has not been procured, or (ii) because of the holding over or retention of possession of any tenant or occupant, or (iii) if repairs, improvements or decoration of the Premises, or of the Building, are not completed, or (iv) because of the operation of a “force majeure” event (as defined below), or (v) for any reason identified in Exhibit “F” attached hereto, or for any other reason, then in any such case Landlord shall not be subject to any liability to Tenant.  Under such circumstances, except as set forth in Paragraph 2 above and Exhibit “F” hereto relating to a “Tenant Delay”, the rent reserved and covenanted to be paid herein shall not commence until possession of the Premises is given or the Premises are available for occupancy by Tenant, and no such failure to give possession shall in any other respect affect the validity of this Lease or any obligation of the Tenant hereunder (except as to the date of commencement of accrual of rent).

 

17.4.  Turnkey Delivery.  As more fully provided for in (and except as limited by) Exhibit “F”, the Tenant Improvements will be performed by Landlord, or a general contractor acting under Landlord’s supervision, at Landlord’s sole expense.

 

18. Telecommunications Services.

 

18.1.  Contract with Provider.  Tenant shall have sole responsibility, at its cost and expense, to contract with a telecommunications service provider of Tenant’s choosing to obtain telecommunications services, subject to the approval of Landlord, which approval shall not be unreasonably withheld.  Landlord has made no warranty or representation to Tenant with respect to the availability of any specific telecommunications services, or the quality or reliability or suitability of any such services.

 

18.2.  Landlord Has No Liability.  Landlord shall have no liability whatsoever for telecommunications services.  Except by cause of malicious, willful, or intentional act of Landlord, to the extent that any services by a telecommunications service provider is interrupted, curtailed or discontinued for any reason, Landlord shall have no obligation or liability whatsoever with respect thereto.  Additionally, such interruption, curtailment or discontinuance of service shall not:

 

(i) Constitute an actual or constructive eviction of Tenant, in whole or in part;

 

(ii) Entitle Tenant to any abatement or diminution of rent;

 

(iii) Relieve or release Tenant from any of its obligations under this Lease; or

 

(iv) Entitle Tenant to terminate this Lease.

 

 

  

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Tenant shall have the sole obligation, at its own expense, to obtain substitute telecommunications service.

 

18.3.  License Agreement with Provider.  Tenant acknowledges that a telecommunications service provider’s right to access the Building and install, operate, maintain and repair wiring and equipment necessary to provide Tenant services is subject to approval by Landlord, not to be unreasonably withheld, and to the terms of a telecommunications license agreement between Landlord and the telecommunications service provider.  Without limiting the generality of Paragraph 18.2 above, Landlord shall have no liability in the event that a telecommunications service provider is unable to provide service to Tenant as a result of the expiration or early termination of the telecommunications license agreement or the exercise by Landlord of any of its rights under the telecommunications license agreement.

 

19. Landlord’s Reliance.  Landlord has executed the Lease in reliance upon certain financial information which has been submitted by Tenant to Landlord prior to the execution of the Lease (the “Financial Information”).  From time to time, upon five (5) days written request by Landlord (but not more often than one time each calendar year, except in the event of a sale or refinancing of the Building or following an Event of Default), Tenant will submit to Landlord current financial information, in detail reasonably satisfactory to Landlord, in order for Landlord to determine properly Tenant’s then financial condition. As a material inducement to Landlord to enter into this Lease, Tenant  represents and warrants to Landlord that:  (i) the Financial Information is complete, true and correct and a presents a fair representation of Tenant’s financial condition at the time of signing of this Lease; (ii) Tenant and the party executing on behalf of Tenant are fully and properly authorized to execute and enter into this Lease on behalf of Tenant and to deliver the same to Landlord; (iii) the execution, delivery and full performance of this Lease by Tenant do not and shall not constitute a violation of any contract, agreement, undertaking, judgment, law, decree, governmental or court order or other restriction of any kind to which Tenant is a party or by which Tenant may be bound; (iv) Tenant has executed this Lease free from fraud, undue influence, duress, coercion or other defenses to the execution of this Lease; (v) this Lease constitutes a valid and binding obligation of Tenant, enforceable against Tenant in accordance with its terms; (vi) each individual executing this Lease on behalf of Tenant is legally competent, has attained the age of majority and has full capacity to enter into this Lease; and (vii) if Tenant is a corporation, a partnership or a limited liability company: (a) Tenant is duly organized, validly existing and in good standing under the laws of the state of its organization and has full power and authority to enter into this Lease, to perform its obligations under this Lease in accordance with its terms, and to transact business in New Jersey; (b) the execution of this Lease by the individual or individuals executing it on behalf of Tenant, and the performance by Tenant of its obligations under this Lease, have been duly authorized and approved by all necessary corporate, partnership or limited liability company action, as the case may be; and (c) the execution, delivery and performance of this Lease by Tenant is not in conflict with Tenant’s bylaws or articles of incorporation, agreement of  partnership, limited liability company operating agreement or certificate of formation or other organization documents or charters, agreements, rules or regulations governing Tenant’s business as any of the foregoing may have been supplemented, modified, amended, or altered in any manner.

 

20. Prior Agreements; Amendments.  This Lease constitutes the entire agreement between the Parties relating to the subject matter contained herein.  Neither Party hereto has 

 

 

 

  

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made any representations or promises except as contained herein or in some further writing signed by the Party making such representation or promise, which, by its express terms, is intended to supplement the terms hereof.  Without limiting the foregoing, this Lease supersedes all prior negotiations, agreements (including Indemnity Agreements, if any), informational brochures, letters, promotional information, proposals, and other statements and materials made or furnished by Landlord or its agents.  No agreement hereinafter made shall be effective to change, modify, discharge, waive obligations under, or effect an abandonment of this Lease, in whole or in part, unless such agreement is in writing and signed by the Party against whom enforcement of the change, modification, discharge, waiver or abandonment is sought.  Notwithstanding the foregoing, no warranty, representation, covenant, writing, document, instrument, amendment, modification, agreement or like instrument shall be binding upon or enforceable against Landlord unless executed by Landlord.

 

21. Captions.  The captions of the paragraphs and subparagraphs in this Lease are inserted and included solely for convenience and shall not be considered or given any effect in construing the provisions hereof.

 

22. Landlord’s Right to Cure.  Landlord may (but shall not be obligated to), on ten (10) days’ notice to Tenant (except that no notice need be given in case of emergency), cure on behalf of Tenant any default hereunder by Tenant, and the cost of such cure (including any applicable attorney’s fees incurred) shall be deemed additional rent payable upon demand.

 

23. Estoppel Statement.  Tenant shall from time to time, within a reasonable period of time (but not longer than 15 days) after request by Landlord or any Mortgagee or Ground Lessor, execute, acknowledge and deliver to Landlord, or to any third party designated by the requesting party, a statement certifying that this Lease is unmodified and in full force and effect (or that the same is in full force and effect as modified, listing any instruments of modification), confirming the rents and other charges under this Lease and the dates to which rent and other charges have been paid, and certifying whether or not, to the best of Tenant’s knowledge, Landlord is in default hereunder or whether Tenant has any claims or demands against Landlord (and, if so, the default, claim and/or demand shall be specified) and such other reasonable information as Landlord shall require, in the form set forth in Exhibit “G” hereto, any other form reasonably required by any current or subsequent mortgagee, or any other reasonable form.  To the extent such estoppel statement is not received from Tenant in a timely manner in accordance with this Paragraph, the requesting party shall be entitled to furnish to any third party to whom such estoppel statement would have been delivered the requesting party’s good faith statement to the effect requested from Tenant, and Tenant shall be bound by, and deemed to have delivered, such estoppel statement with respect to this Lease.  Any such estoppel statement may be relied upon by the requesting party, as well as all Mortgagees, Ground Lessors, auditors, insurance carriers and prospective purchasers and lenders.

 

24. Intentionally Deleted.

 

25. Broker. Tenant represents and warrants that it has not dealt with any broker or agent in the negotiation for or the obtaining of this Lease, other than Mercer Oak Realty, L.L.C., as “Landlord’s Broker”, and The Flynn Company, as “Tenant’s Broker” (collectively the “Brokers”), and agrees to indemnify, defend and hold Landlord harmless from any and all cost 

 

 

  

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or liability for compensation claimed by any such broker or agent, other than Brokers, employed or engaged by Tenant or claiming to have been employed or engaged by Tenant.  To the extent each of the Brokers is entitled to a leasing commission in connection with the making of this Lease, Landlord shall pay such commission to each of the Brokers pursuant to (and subject to the terms of) a separate agreement between Landlord and each of the respective Brokers.

 

26. Miscellaneous.

 

26.1.  Certain Interpretations.  The word “Tenant” as used in this Lease shall be construed to mean tenants in all cases whether there is more than one tenant (and in such case the liability of such tenants shall be joint and several), and the necessary grammatical changes required to make the provisions hereof apply to corporations, partnerships or individuals, men or women, shall in all cases be assumed as though in each case fully expressed.  Each provision hereof shall extend to and shall, as the case may require, bind and inure to the benefit of Tenant and its successors and assigns, provided that this Lease shall not inure to the benefit of any assignee or successor of Tenant except upon the express written consent of Landlord as herein provided.

 

26.2.  Partial Invalidity.  If any of the provisions of this Lease, or the application thereof to any person or circumstances, shall, to any extent, be invalid or unenforceable, the remainder of this Lease, or the application of such provision or provisions to persons or circumstances other than those as to whom or to which it is held invalid or unenforceable, shall not be affected thereby, and every provision of this Lease shall be valid and enforceable to the fullest extent permitted by law.

 

26.3.  Governing Law.  This Lease shall be governed in all respects by the laws of the State of New Jersey.  EACH PARTY HEREBY IRREVOCABLY SUBMITS TO THE EXCLUSIVE JURISDICTION OF THE STATE AND FEDERAL COURTS OF NEW JERSEY FOR PURPOSES OF ANY PROCEEDINGS ARISING OUT OF THIS LEASE.  Each Party waives any objection which it may have based on lack of personal jurisdiction, improper venue or forum non conveniens to the conduct of any proceeding in any such court and waives personal service of any and all process upon such Party.

 

26.4.  Force Majeure.  If either Party shall be delayed in the performance or unable to perform any of such Party’s obligations under this Lease because of a “force majeure” event (which shall mean any event beyond the reasonable control of Landlord including, without limitation, labor disputes, civil commotion, terrorism, war, war-like operations, invasion, rebellion, hostilities, military power, sabotage, governmental regulations or controls, fire or other casualty, inability to obtain material or services, inclement weather or other act of God), then, in any such case, the obligated Party shall not be subject to any liability to the other Party.  Either Parties’ delay in performance or failure to perform under this Lease as a result of any force majeure event shall not affect the validity of this Lease or any obligation of the other Party hereunder.  The terms of this Paragraph shall not apply to either party’s financial obligations under this Lease or Tenant’s obligation to obtain and maintain the insurance required in Paragraph 9.3, provided, however, that the terms of this Paragraph shall not supersede any abatement of rent to which Tenant may be entitled pursuant to the terms of Section 5.9 or Section 8 of this Lease.

 

 

  

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26.5.  Light and Air.  This Lease does not grant any legal rights to “light and/or air” outside the Premises nor any particular view or cityscape visible from the Premises.

 

26.6.  Recording.  Neither this Lease nor any memorandum of lease or short form lease shall be recorded by Tenant and Tenant shall remove immediately upon request by Landlord any improperly recorded copy of this Lease or memorandum of Lease.

 

26.7.  Preparation.  Landlord and Tenant agree that both Landlord and Tenant have participated in the preparation of this Lease and that, notwithstanding any common law rule of construction to the contrary, in the event of any ambiguity herein, this Lease shall not be construed against either Party based on which Party drafted the provision in question.

 

26.8.  Third Party Inquiry.  Tenant acknowledges that, from time to time, Landlord may receive inquiries from third parties regarding Tenant, this Lease and/or Tenant’s performance under this Lease.  Except for requests received by Landlord in the ordinary course of business (i.e., requests from prospective purchasers, lenders, investors or other potential financing sources) Landlord shall not respond to any such request or inquiry without first receiving the written approval of Tenant, provided, however, no such approval shall be required if Landlord is required to respond by official order of a Court of competent jurisdiction, in which instance Landlord shall provide Tenant with reasonable advanced notice of compliance. Tenant hereby releases and discharges Landlord and each of its respective affiliates of and from any and all liability, losses, costs and damages incurred by Tenant as a result of any such response.

 

26.9.  Third Party Beneficiaries.  Notwithstanding anything to the contrary contained herein, no provision of this Lease is intended to benefit any party other than Landlord and Tenant as the named parties hereunder and their permitted heirs, personal representatives, successors and assigns, and no provision of this Lease shall be enforceable by any other party.

 

26.10.  No Joint Venture. Nothing in this Lease is deemed to make or imply that Landlord and Tenant are partners or joint venturers.

 

26.11.  Attorneys’ Fees.  In any legal action to enforce the terms of this Lease or in connection with any of the provisions hereof, the prevailing party shall have the right to collect any and all attorney’s fees and costs from the non-prevailing party. In case of any legal action, the Parties, hereby agree that no Party shall have the right to collect attorney fees and/or costs should a mutually agreed upon settlement be reached by the Parties (except as may otherwise agreed upon in such settlement agreement). In connection with any payment of attorneys’ fees and costs pursuant to this Lease, Landlord and Tenant hereby agree that the amount due shall be based on actual fees and costs incurred, and not upon any applicable presumption under New Jersey law.

 

26.12.  Names.  Upon written notice to Tenant, Landlord reserves the right, from time to time, to change the name of the development, the name of the Building and the street address of the Building, provided, however, that Landlord shall reimburse Tenant’s costs of replacing reasonable amounts of commonly used business stationary, business cards, letterhead, envelopes, and marketing materials.  Tenant shall not, without the prior written consent of Landlord, use the name given the development, the Building, or any other deceptively similar name, or use any 

 

 

  

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associated service mark or logo of the development or the Building for any purpose other than Tenant’s business address.

 

26.13.  Multiple Tenants.  Should more than one party enter into this Lease as Tenant, each party so constituting Tenant shall be liable, jointly and severally with the other or others, for all obligations of Tenant under this Lease, and Landlord may enforce its rights hereunder against such party with or without seeking enforcement thereof against the other or others.

 

26.14.  Time is of the Essence. Time is of the essence of this Lease.  Unless specifically provided otherwise, all references to terms of days or months shall be construed as references to calendar days or calendar months, respectively.

 

26.15.  Execution and Delivery.  This Lease shall only become effective and binding upon full execution hereof by Landlord and Tenant, and delivery of a signed copy to Tenant.

 

27. Quiet Enjoyment.  Upon payment by Tenant of the rent and other sums provided herein and Tenant’s observance and performance of the covenants, terms and conditions of this Lease to be observed and performed by Tenant, Tenant shall peaceably hold and quietly enjoy the Premises for the term of this Lease without hindrance or obstruction by Landlord or any other person claiming by, through or under Landlord, subject to the terms and conditions of this Lease, and to any mortgage or ground lease which is superior to this Lease.

 

28. Confidentiality.  TENANT ACKNOWLEDGES AND AGREES THAT THE TERMS OF THIS LEASE AND THE NEGOTIATIONS WHICH LED TO THE EXECUTION OF THIS LEASE ARE CONFIDENTIAL IN NATURE.  TENANT COVENANTS THAT, EXCEPT AS MAY BE REQUIRED BY LAW OR BY ANY LENDER IN CONNECTION WITH CURRENT OR PROPOSED FINANCING FOR TENANT, TENANT SHALL NOT COMMUNICATE THE TERMS OR ANY OTHER ASPECT OF THIS TRANSACTION WITH, AND WILL NOT DELIVER ALL OR ANY PORTION OF THIS LEASE TO, ANY PERSON OR ENTITY OTHER THAN LANDLORD.

 

29. Patriot Act.  Tenant (which for this purpose includes its partners, members, principal stockholders and any other constituent entities) (i) has not been designated as a “specifically designated national and blocked person” on the most current list published by the U.S. Treasury Department Office of Foreign Assets Control at its official website, <http://www.treas.gov/ofac/t11sdn.pdf> or at any replacement website or other replacement official publication of such list; (ii) is currently in compliance with and will at all times during the term of this Lease (including any extension thereof) remain in compliance with the regulations of the Office of Foreign Asset Control of the Department of the Treasury and any statute, executive order (including the September 24, 2001, Executive Order Blocking Property and Prohibiting Transactions with Persons Who Commit, Threaten to Commit, or Support Terrorism), or other governmental action relating thereto; and (iii) has not used  and will not use funds from illegal activities for any payment made under the Lease.

 

30. Consents.  If any action, inaction, activity or other right or obligation of Tenant under this Lease is subject to the prior consent or approval of Landlord, such approval may be 

 

 

  

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granted or denied in Landlord’s sole and absolute discretion, unless the provision in question states that Landlord’s consent or approval “shall not be unreasonably withheld.”

 

31. Survival.  Without limiting any other provision of this Lease which provides for the survival of obligations after Lease termination or dispossession, all provisions of this Lease which (i) contemplate that the Parties will take an action or pay a sum of money within a time frame that may elapse after the expiration or earlier termination of the Term, (ii) provide indemnity against Claims arising out of acts or omissions occurring during the Term even if such Claims are not asserted or resolved until after the expiration or earlier termination of the Term, (iii) impose liability for rent, additional rent, and other charges (even if such amounts are not asserted or incurred until after such termination of the Term or dispossession), and/or for costs of reletting or other damages, after the occurrence a breach or default, and/or (iv) impose liability for damages due to acts, omissions or Events of Default occurring during the Term even if such damages are not asserted or incurred until after the expiration or earlier termination of the Term, shall, to the extent the obligation created under the applicable provision is not fully satisfied as of the date of expiration or earlier termination of the Lease, or any dispossession of Tenant, survive such expiration, termination or dispossession (and shall not be merged therein).

 

32. Saving Clause.  In the event (but solely to the extent) the limitations on Landlord’s liability set forth in this Lease would be held to be unenforceable or void in the absence of a modification holding the Landlord liable to Tenant or to another person for injury, loss, damage or liability arising from Landlord’s omission, fault, negligence or other misconduct on or about the Premises, or other areas of the Building or Property appurtenant thereto or used in connection therewith and not under Tenant’s exclusive control, then such provision shall be deemed modified as and to the extent (but solely to the extent) necessary to render such provision enforceable under applicable law.  The foregoing shall not affect the application of Section 9.5 of this Lease to limit the assets available for execution of any claim against Landlord.

 

33. Renewal.

           33.1.           Grant of Option.  Tenant is hereby granted the right and option (the "Renewal Option") to extend the term of the Lease for one (1) additional period of five (5) years, such renewal term (the "Renewal Term") to commence on the expiration of the initial term and to expire on the last day of the sixtieth (60th) complete calendar month thereafter, provided that:

                      (A)  At the time the Tenant’s Conditional Renewal Notice (as defined below) is received by Landlord, and at the time the Tenant’s Unconditional Renewal Notice (as defined below) is received by Landlord, and at the time the Renewal Term commences, the Lease shall be in full force and effect and there shall exist no Event of Default by Tenant or event which with the passage of time, the giving of notice or both, would constitute a default by Tenant;

                      (B)  The Renewal Option, when effectively exercised, shall apply to the entire then-current Premises; and

                      (C)  The Renewal Option is personal to Tenant and may only be exercised by Tenant and not by any assignee of the Lease or subtenant of all or any portion of the Premises (except an Affiliate), whether or not Landlord has consented to such assignment or subletting.

 

 

 

  

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           33.2.           Procedure.  If Tenant wishes to exercise the Renewal Option, Tenant shall follow the following procedure:

                      (A)  Tenant shall give written notice ("Tenant’s Conditional Renewal Notice") to Landlord on or before the date that is nine (9) months prior to the end of the initial term of this Lease (but not earlier than 18 months prior to the expiration of the initial term), stating that Tenant desires to preserve its right to exercise the Renewal Option.

                      (B)  Within thirty (30) days after receiving Tenant’s Conditional Renewal Notice, Landlord shall give Tenant, in writing, notice ("Landlord’s Response") which shall include: (i) Landlord’s then offered rental rates and annual escalations applicable to the Renewal Term (collectively, the "Prevailing Market Rate", the calculation of which Prevailing Market Rate is described below) (which rate for the first year of the Renewal Term shall be not less than the escalated annual minimum rent plus the estimated additional rent for all of the Premises established for the last year of the Lease term), (ii) the leasehold improvement allowance, if any, and other tenant-incentives (including free rent), if any, which Landlord determines are then being offered for comparable space (as described below), and (iii) provisions relating to additional rent (including Tenant’s Share of Taxes and Tenant’s Share of Operating Expenses); all as adjusted by Landlord to reflect the time periods covered by, and length of, the Renewal Term.

For purposes hereof, the "Prevailing Market Rate" shall mean the rent to be paid by new tenants of the Building for comparable space in the Building or to be paid by existing tenants under renewals of existing leases where the rent for the renewal term thereunder is to be determined at the time of renewal for such new leases or renewals.  The effective date of such rentals of comparable space shall be within one (1) year preceding the date of Landlord’s Response.  For purposes of this Section, "comparable space" shall mean tenancies of space in the Building of similar size, term and location (adjusted on a square foot basis to reflect the rentable square footage of the Premises), and if no such comparable space has been leased by Landlord in the Building within the one (1) year preceding the date of Landlord’s Response, then "comparable space" shall mean space of similar size, term and location in comparable office buildings (based on buildings of comparable quality and location and only including buildings constructed since 2000 in the Princeton market, which shall include, but is not limited to, Ewing, NJ).  If the manner of charging Operating Expenses or Taxes or other items of escalation to tenants in the Building or in comparable buildings utilized by Landlord or such other landlords is different from that set forth in the Lease, Landlord shall make an adjustment to the Prevailing Market Rate to take such difference into account and shall make further adjustments for relevant differences such as size of space, term, location and incentives for initial occupancy (and the inapplicability of such incentives in the case of renewals or extensions).

                      (C)  If Tenant wishes to exercise the Renewal Option, Tenant must, within fifteen (15) days after receiving Landlord’s Response, give written unconditional notice ("Tenant’s Unconditional Renewal Notice") to Landlord, stating that Tenant is exercising the Renewal Option.  Tenant’s Unconditional Renewal Notice shall constitute Tenant’s agreement with all of the terms and conditions of Landlord’s Response.

 

 

  

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           33.3.           Terms of Option.  If the Renewal Option is effectively exercised, all of the terms and conditions contained in this Lease shall continue to apply during the Renewal Term, except that:

                      (A)  There shall be no further right of renewal beyond the one (1) Renewal Term;

                      (B)  There shall be no rent abatements, construction allowances, or other concessions for or with respect to the Renewal Term (except to the extent the same were contained in Landlord’s Response) and no leasing or other brokerage commissions shall be payable (other than to Landlord’s broker, if any); and

                      (C)  The annual minimum rent during the Renewal Term shall be as set forth in Landlord’s Response (provided that the rate for the first year of the Renewal Term shall be not less than the escalated annual minimum rent plus the estimated additional rent for all of the Premises established for the last year of the Lease term), and all annual minimum rent and all additional rent for and during the Renewal Term shall be paid in the manner and at the times required by the Lease.

           33.4.           Failure To Exercise.  In the event Tenant fails to provide to Landlord (i) Tenant’s Conditional Renewal Notice, or (ii) Tenant’s Unconditional Renewal Notice, in either case, in the manner and within the applicable time period set forth herein, this Renewal Option shall automatically and immediately terminate and Tenant shall have no other Renewal Option.  In such event, the Renewal Option shall be of no force or effect and Landlord shall be free to lease the Premises to any other person or entity, on whatever business terms Landlord may choose.

           33.5.           Time of the Essence.  Landlord and Tenant agree that all time periods and deadlines contained in this Renewal Option are of the essence.

33.6.           Tenant’s Disagreement with Landlord’s Response.  Notwithstanding the foregoing, if Tenant disagrees with Landlord’s determination of the Prevailing Market Rate as set forth in Landlord’s Response, then, not later than fifteen (15) days following the receipt by Tenant of Landlord's Response as aforesaid, Tenant shall be permitted to exercise, in writing, either of the following two (2) options:

(A)           Tenant may revoke a previously exercised Renewal Option; or

(B)           Tenant may invoke arbitration under this Section 33.6(B) (any such notice is referred to as an "Arbitration Notice").  Tenant’s Arbitration Notice shall include (i) on the cover page, in all capital letters and in bold-face type, a statement that it is an Arbitration Notice under the Lease; and (ii) Tenant’s determination of the Prevailing Market Rate (which shall be presented in the form set forth in Landlord’s Notice).  No Arbitration Notice shall be sent by facsimile transmission.  Each party shall, within ten (10) business days after Landlord’s receipt of the Arbitration Notice, appoint an auditor and the two (2) auditors so appointed shall, within 

 

 

 

  

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five (5) business days after the second of them has been appointed, appoint a third auditor (the "Third Auditor").  All auditors (including the Third Auditor) shall have at least ten (10) years experience in the leasing and marketing of first-class commercial office buildings similar to the Building and shall have no "disqualifying interest" (as defined below).  If the two (2) auditors selected by the parties are unable to agree upon the Third Auditor within such five (5) business day period, either party may apply to the local Chapter of the American Arbitration Association for the appointment of the Third Auditor.  If either party fails to appoint an auditor within ten (10) business days of Landlord’s receipt of the Arbitration Notice, the auditor appointed by the other party shall be the Third Auditor.  The Third Auditor shall review Landlord’s and Tenant’s determination of the Prevailing Market Rate and shall select the determination which the Third Auditor believes is most accurate; it is acknowledged and agreed that the Third Auditor shall only have the authority to select the determination of the Prevailing Market Rate as calculated by either Landlord or Tenant (and the Third Auditor shall have no power or authority to select any other determination) and shall render its decision within ten (10) days after submission of the issue to the Third Auditor.  The parties agree that the decision of the Third Auditor shall be final and binding on the parties for the Renewal Term and may be enforced in any court of competent jurisdiction.  Each party shall pay the cost of its own auditor and the costs of the Third Auditor shall be paid by the losing party.  For purposes hereof, "disqualifying interest" means any direct or indirect financial or other business interest in Landlord or Tenant or any entity affiliated with either of them.

(C)           If Tenant fails to notify Landlord, in writing, of its exercise of either of the options set forth in Sections 33.6(A) or (B) above within fifteen (15) days following the receipt by Tenant of Landlord's Response (time being of the essence thereof), then Tenant shall be deemed to have accepted Landlord's determination of the "Prevailing Market Rate" as set forth in Landlord’s Response, and the Lease shall be renewed and extended for the Renewal Term, on and subject to the terms and conditions herein set forth.

 

34. Tenant’s Right of First Offer.  Tenant is hereby granted the right and option (the “First Offer Option”) to lease any other space (the “First Offer Space”) on the third floor of the Building which has been previously leased to another tenant and is (i) contiguous to the Premises (as the Premises exists on the date hereof), (ii) then available for lease and (iii) not leased or subject to any renewal, expansion, or other option given or granted prior to the date of this Lease.  The First Offer Option as aforesaid is hereby granted to Tenant all on and subject to the following terms and conditions:

 

34.1.  Landlord’s RFO Notice.  If at any time during the period of time commencing on the Commencement Date and ending on the date that is twelve (12) months prior to the expiration date of this Lease (the “First Offer Period”), Landlord shall determine that all or a portion of the previously leased First Offer Space shall become available during the term of this Lease, Landlord shall notify Tenant, in writing, of the availability of such First Offer Space (“Landlord’s RFO Notice”).  Landlord’s RFO Notice shall identify the applicable portion of the First Offer Space which shall become available (to include the location and number of rentable square feet) and shall contain the proposed business terms of a lease amendment between Landlord and Tenant in respect of such space, which business terms shall include: (i) the commencement date (the “First Offer Space Commencement Date”) and the expiration date (the “First Offer Space Expiration Date”), which First Offer Space Expiration Date shall be, 

 

 

 

  

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subject to Section 34.3 below, the expiration date of this Lease, but in no event shall the First Offer Space Expiration Date be less than sixty (60) months after the First Offer Space Commencement Date, (ii) rental rates and other business terms, which shall be based on Landlord's then offered rental rates and other business terms, (iii) provisions relating to additional rent (including Tenant's Share of Taxes and Tenant’s Share of Operating Expenses), and (iv) provisions relating to the tenant improvement allowance, which shall be based on Landlord's then offered tenant improvement allowance, adjusted for the term of the Lease with respect to such First Offer Space. Furthermore, if at any time Tenant’s exercise of the First Offer Option would result in the Premises consisting of 12,000 rentable square feet or more of space, then Landlord shall have the right to re-review the then-current financial condition of Tenant and/or to require an additional security deposit or other credit-enhancement in connection with such exercise.

 

34.2.  Definition of “available”. For the specific purposes of this Section, First Offer Space shall be considered “available” only if such space has been previously leased to another tenant, and in Landlord’s sole judgment, such space is not leased, or subject to lease, for any part of the period commencing on the First Offer Space Commencement Date and expiring on the First Offer Space Expiration Date; provided, however, that (i) Landlord may permit any then-existing tenant to renew or extend its lease (either by the execution of a new lease or by an amendment to its existing lease), whether or not such lease contains an option to do so, and the space subject to any such lease shall not be considered “available”; and (ii) space recaptured by Landlord from a tenant as a result of Landlord exercising its right to do so upon receiving a request to sublease shall not be considered “available”.

 

34.3.  Exercise.  A First Offer Option must be exercised on and subject to the following terms and conditions:  (i) a First Offer Option must be exercised by Tenant, if at all, by written notice from Tenant to Landlord given not later than five (5) business days following the date of Tenant's receipt of a Landlord’s RFO Notice in respect thereof; and (ii) at the time of exercising any First Offer Option, this Lease shall be in full force and effect and no Event of Default (after the expiration of any applicable notice and cure period) under the Lease shall exist on the date that Tenant exercises the First Offer Option; provided, however, that if on the date that Tenant exercises the First Offer Option, an event which, with the passage of time, the giving of notice or both, would constitute an Event of Default shall have occurred, Tenant’s failure to cure such event within the applicable cure period under the Lease shall, at Landlord’s election, render Tenant’s exercise of the First Offer Option null and void.  If there shall remain less than sixty (60) full calendar months in the term of this Lease as of the scheduled First Offer Space Commencement Date, then the term of this Lease for the Premises shall be automatically extended so that the term expires on the First Offer Space Expiration Date.  During such extended term, Minimum Rent for the Premises (i.e., 8,065 RSF or as expanded prior to Tenant’s exercise of the First Offer Option) shall be calculated based upon the same per square foot rate as Tenant is obligated to pay for the First Offer Space, commencing on the first day of the month after the original term of this Lease (prior to the extension taking effect) expires (provided, however, Landlord shall have no obligation to perform any improvements, alterations or redecorating or other work in the Premises, or to provide any construction or monetary allowance with respect thereto).  Tenant’s exercise of the First Offer Option shall constitute Tenant’s agreement with all of the terms and conditions of Landlord’s RFO Notice.  Time is of the essence with respect to Tenant’s exercise of its First Offer Option.

 

 

  

56

  

 

34.4.  Lease Terms.  In the event a First Offer Option is effectively exercised, all terms and conditions contained in the Lease shall continue to apply in respect of the First Offer Space so taken, effective as of the First Offer Space Commencement Date, on and subject to (and expressly including) all of the terms and provisions set forth in the applicable Landlord’s RFO Notice.  All First Offer Space that is taken, in accordance with the foregoing provisions of this Section, shall become part of the Premises and included as such for all purposes of the Lease.  If Tenant effectively exercises its First Offer Option, then Landlord and Tenant shall promptly thereafter execute an amendment to this Lease confirming such exercise and reflecting the terms and conditions set forth herein and in the Landlord’s RFO Notice.

 

34.5.  Failure to Exercise.  In the event Tenant fails to exercise a First Offer Option in the manner and within the applicable time period therefor set forth herein, then the First Offer Option with respect to that space so offered by Landlord shall immediately terminate and Tenant shall have no other First Offer Option with respect to such space.  Upon Tenant’s failure to exercise a First Offer Option, Landlord shall be free to lease such First Offer Space to any other person or entity, on such terms as Landlord may choose.

 

34.6.  Termination of Tenant’s First Offer Option.  The First Offer Option set forth in this Section 34 shall be of no further force and effect and shall expire on the earlier to occur of (i) expiration or earlier termination of this Lease, (ii) the assignment by Tenant of this Lease, in whole or in part (other than to an Affiliate) and (iii) the sublease by Tenant of all or any part of the Premises (other than to an Affiliate).

 

 

 

 [Signatures appear on next page]

 

 

 

  

57

  

 

IN WITNESS WHEREOF, intending to be legally bound hereby, the parties hereto have caused this Office Lease to be executed by their duly authorized representatives the day and year first above written.

 

 

 

 

 

 

 

	 	LANDLORD:	 
	 	 	 
	 	PRINCETON SOUTH INVESTORS, LLC,	 
	 	a Delaware limited liability company	 
	 	 	 
	 	 	 
	 	By:	 /s/ CRAIG ZOLOT	 
	 	 	 Name:  Craig Zolot                      	 
	 	 	 Title:  Sr. Vice President           	 
	 	 	 	 

	 	TENANT:	 
	 	 	 
	 	ANTARES PHARMA, INC., a Delaware corporation	 
	 	 	 
	 	 	 
	 	By:	 /s/ ROBERT APPLE	 
	 	 	 Name:  Robert Apple                     	 
	 	 	 Title:    CFO                                  	 
	 	 	 	 

  

58

  

 

 

INDEX OF CERTAIN DEFINED TERMS

 

	
Term

	
Page

	
"Abatement Period"

	
5

 

	
"Affiliate"

	
30

 

	
"Arbitration Notice"

	
55

 

	
"Automatic Approval Notice"

	
28

 

	
"available"

	
56

 

	
"Base Amount for Operating Expenses"

	
11

 

	
"Base Amount for Taxes"

	
11

 

	
"Base Year"

	
11

 

	
"Brokers"

	
48

 

	
"Building Standard Consumption"

	
16

 

	
"Building"

	
1

 

	
"Building Electricity"

	
16

 

	
"Building Hours"

	
16

 

	
"Commencement Date"

	
3

 

	
"Early Access Date"

	
4

 

	
"Effective Date"

	
29

 

	
"Essential Capital Improvement"

	
11

 

	
"Event of Default"

	
37

 

	
"Execution Date"

	
1

 

	
"Expense Statement"

	
13

 

	
"Final Adjustment Amount"

	
13

 

	
"Financial Information"

	
46

 

	
"First Offer Commencement Date"

	
56

 

	
"First Offer Space"

	
56

 

	
"First Offer Expiration Date"

	
56

 

	
"First Offer Option"

	
53

 

	
"force majeure"

	
49

 

	
"Former Landlord"

	
36

 

	
"Governmental Requirements"

	
11

 

 

 

  

59

  

 

 

 

	
"Ground Lease"

	
42

 

	
"Ground Lessor"

	
42

 

	
"Holidays"

	
16

 

	
"HVAC"

	
15

 

	
"Landlord"

	
1

 

	
"Landlord's Diuspute Notice"

	
14

 

	
"Landlord's Response"

	
53

 

	
"Landlord's RFO Notice"

	
56

 

	
"Lease"

	
1

 

	
"Mortgage"

	
42

 

	
"Mortgagee"

	
42

 

	
"Non-Reserved Spaces"

	
2

 

	
"Offset Right"

	
35

 

	
"Operating Expenses"

	
8

 

	
"Occupancy Permit"

	
3

 

	
"Owners Association"

	
12

 

	
"Parent Company"

	
30

 

	
"Permitted Uses"

	
1

 

	
"Personal Property Insurance"

	
33

 

	
"Premises"

	
1

 

	
"Property"

	
1

 

	
"Recapture Notice"

	
29

 

	
"Relocation Notice"

	
48

 

	
"Renewal Option"

	
53

 

	
"Renewal Term"

	
53

 

	
"Rent"

	
6

 

	
"Review Period"

	
13

 

	
"Security Deposit"

	
7

 

	
"Standard Office Equipment"

	
16

 

	
"Substantial Completion"

	
3

 

	
"Successor Landlord"

	
35

 

	
"Supplemental HVAC Equipment"

	
16

 

	
"Surety"

	
36

 

 

  

60

  

 

 

	
"Taxes"

	
7

 

	
"Tenant"

	
1

 

	
"Tenant's Conditional Renewal Notice"

	
53

 

	
"Tenant's Estimated Share"

	
12

 

	
"Tenant's Proportionate Share"

	
12

 

	
"Tenant's Proprotionate Share of Building Electricty"

	
16

 

	
"Tenant's Share of Operating Expenses"

	
12

 

	
"Tenant's Share of Taxes"

	
12

 

	
"Tenant's Unconditional Renewal Notice"

	
54

 

	
"Term"

	
3

 

	
"Total Rentable Square Feet"

	
12

 

	
"Transfer Space"

	
28

 

	
"Transfer"

	
27

 

	
"Waste"

	
25

 

	
“Authorities”

	
12

 

	
“Authority”

	
12

 

	
“Minimum Rent”

	
4

 

	
“Rent Commencement Date”

	
4

 

	
“shutdown condition”

	
20

 

  

61

  

 

EXHIBIT “A”

FLOOR PLAN OF THE PREMISES

 

 

 

 

 

 

 

 

 

 

  

Exhibit A - Page 1

  

 

 

  

Exhibit A - Page 2

  

 

 

EXHIBIT “B”

 

INTENTIONALLY OMITTED

 

 

  

Exhibit B

  

 

 

 

EXHIBIT “C”

 

CONFIRMATION OF LEASE TERM

 

This Agreement, made this ____ day of _________, 201_, between PRINCETON SOUTH INVESTORS, LLC, a Delaware limited liability company (hereinafter referred to as “Landlord”) and ANTARES PHARMA, INC., a Delaware corporation (hereinafter referred to as “Tenant”);

W I T N E S S E T H  T H A T:

 

WHEREAS, Landlord and Tenant entered into an office lease agreement dated ____________, 2012 (the “Lease”) for Suite _____ (the “Premises”) in the building currently known as Princeton South Corporate Center Condominium – Unit 1, 100 Charles Ewing Boulevard, Ewing, Mercer County, New Jersey 08628; and

WHEREAS, Landlord and Tenant agreed to execute this Agreement to confirm the actual Commencement Date and expiration of the Lease term, and for other purposes;

NOW, THEREFORE, pursuant to the provisions of Paragraph 2.3 of the Lease, Landlord and Tenant mutually agree as follows:

1.  The Commencement Date is__________, 201_, the Rent Commencement Date shall be ___________, 201_, and the expiration date is __________, 201_.

2.  The number of rentable square feet of the Premises is 8,065.

3.  Tenant is in possession of, and has accepted, the Premises demised by the Lease, and acknowledges that all the work to be performed by Landlord in the Premises as required by the terms of the Lease has been satisfactorily completed.  Tenant further certifies that all conditions of the Lease required of Landlord as of this date have been fulfilled and there are no defenses or setoffs against the enforcement of the Lease by Landlord.

[SIGNATURES COMMENCE ON FOLLOWING PAGE]

 

 

 

  

Exhibit C 

  

 

IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement as of the date and year first above stated.

 

 

 

	 	LANDLORD:	 
	 	 	 
	 	PRINCETON SOUTH INVESTORS, LLC,	 
	 	a Delaware limited liability company	 
	 	 	 
	 	 	 
	 	By:	 	 
	 	 	 Name:                                                    	 
	 	 	 Title:                                                           	 
	 	 	 	 

	 	TENANT:	 
	 	 	 
	 	ANTARES PHARMA, INC.	 
	 	 	 
	 	 	 
	 	By:	 	 
	 	 	 Name:                                                  	 
	 	 	 Title:                                                     	 
	 	 	 	 

 

 

  

Exhibit C

  

 

EXHIBIT “D”

 

JANITORIAL SERVICES

OFFICE AREAS

DAILY:

	
1.

	
Dust mop all hard areas.  Hard floors to be damp mopped using a neutral cleaner.

2.           Vacuum all carpeting and rugs, ledge to be vacuumed as necessary in common area only.

3.           Empty all waste receptacles.

4.           All painted surfaces to be kept free of fingerprints, smudges, and all foreign matter.

5.           Dust all office furniture.

6.           Remove smudges from all glass and tabletops.

7.           When desks are completely cleared, dust thoroughly.

8.           Entrance glass doors to be washed, interior and exterior.

9.           All lights will be turned off and doors closed and locked upon completion of work in each area.  Check all windows and adjust blinds to original position.

WEEKLY:

1.           Dust all partition glass ledges, louvers, grills and vents.

2.           Dust all furniture.

3.         Vacuum all offices and cubicles on rotation to get to all once/week.

MONTHLY:

1.           Dust all picture frames, charts and other wall hangings.

2.         Dust all louvers, grills and vents.

 

 

 

  

Exhibit D

  

QUARTERLY:

1.           All interior partition glass to be washed.

2.           All lighting fixtures to be dusted.

SEMI-ANNUALLY:

	
1.  

	
All vertical surface walls and woodwork to be dusted.

2.         Machine scrub and refinish all hard surfaces.

RESTROOMS

DAILY:

1.           Sweep and mop all flooring with a germicidal cleaner having an AOC phenal co-efficient of six or better.

	
2.

	
Fill all restroom dispensers.  Paper towels, toilet paper, hand soap will be furnished by Contractor.

	
3.

	
Empty all waste receptacles, dispose of the same to a trash dumpster furnished by the client.

	
4.

	
Clean and disinfect all commodes, urinals and sinks.  Leave toilet lids in the upright position.

5.           Damp wipe all wall surfaces, wainscoting and dispensers.

6.           Wash and polish mirrors and enameled surfaces.

	
7.

	
Traps shall remain free of odor at all times.  Traps are to be flushed weekly using an enzymer.

8.           Dust all sills, partitions, ledges and shelves.

9.           Clean and wipe dry all pipes under the sink.

10.           Remove spots from walls.  Spot clean stall, door jambs and door plates.

11.           Report toilet stoppage, leaky faucets, etc. to Client.

 

 

 

  

Exhibit D

  

 

WEEKLY:

	
1.

	
Wash thoroughly and wipe dry with a disinfectant/germicidal cleaner the partitions, the inside and outside of waste cans, sanitary disposal units and tiled walls.

MONTHLY:

	
1.

	
All surfaces, partitions, doors, window frames, and sills shall be damp wiped clean.

QUARTERLY:

	
1.  

	
Machine scrub restroom floors.

	
2.  

	
Wipe down all restroom surfaces.

  

Exhibit D

  

 

 

 

EXHIBIT “E”

 

RULES & REGULATIONS

 

	
1.  

	
The water and wash closets and other plumbing fixtures shall not be used for any purposes other than those for which they were constructed, and no sweepings, rubbish, rags or other substances (including, without limitation, coffee grounds) shall be thrown therein.  All damages resulting from misuse of the fixtures shall be borne by Tenant if Tenant or its servants, employees, agents, visitors or licensees shall have caused the same.

 

	
2.  

	
No cooking (except for hot-plate and microwave cooking by Tenants' employees for their own consumption, the location and equipment of which is first approved by Landlord), sleeping or lodging shall be permitted by any tenant on the Premises.  No tenant shall cause or permit any unusual or objectionable odors to be produced upon or permeate from the Premises.

 

	
3.  

	
No inflammable, combustible, or explosive fluid, material, chemical or substance shall be brought or kept upon, in or about the Premises. Fire protection devices, in and about the Building, shall not be obstructed or encumbered in any way.

 

	
4.  

	
Canvassing, soliciting and peddling in the Building are prohibited and each tenant shall cooperate to prevent the same.

 

	
5.  

	
There shall not be used in any space, or in the public halls of the Building, either by any tenant or by its agents, contractors, jobbers or others, in the delivery or receipt of merchandise, freight, or other matters, any hand trucks or other means of conveyance except those equipped with rubber tires, rubber side guards, and such other safeguards as Landlord may require, and Tenant shall be responsible to Landlord for any loss or damage resulting from any deliveries to Tenant in the Building.  Deliveries of mail, freight or bulky packages shall be made through the freight entrance or through doors specified by Landlord for such purpose.

 

	
6.  

	
Mats, trash or other objects shall not be placed in the public corridors. The sidewalks, entries, passages, elevators, public corridors and staircases and other parts of the Building which are not occupied by Tenant shall not be obstructed or used for any other purpose than ingress or egress.

 

	
7.  

	
Tenant shall not install or permit the installation of any awnings, shades, draperies and/or other similar window coverings, treatments or like items visible from the exterior of the Premises other than those approved by Landlord in writing.

 

	
8.  

	
Tenant shall not construct, maintain, use or operate within said Premises or elsewhere in the Building or on the outside of the Building, any equipment or machinery which produces music, sound or noise which is audible beyond the Premises.

 

 

 

  

Exhibit E

  

 

 

	
9.  

	
Motor scooters or any other type of vehicle shall not be brought into the lobby or elevators of the Building or into the Premises except for those vehicles which are used by a physically disabled person in the Premises.

 

	
10.  

	
All blinds for exterior windows shall be building standard and shall be maintained by Tenant.

 

	
11.  

	
No additional locks shall be placed upon doors to or within the Premises except as shall be necessary adequately to safeguard United States Government security classified documents stored with the Premises.  The doors leading to the corridors or main hall shall be kept closed during business hours, except as the same may be used for ingress or egress.

 

	
12.  

	
Tenant shall maintain and clean all areas or rooms within the Premises in which security classified work is being conducted or in which such work is stored; Landlord shall not provide standard janitorial service to such areas, the provisions of Section 9 of this Lease notwithstanding.

 

	
13.  

	
Landlord reserves the right to shut down the air conditioning, electrical systems, heating, plumbing and/or elevators when necessary by reason of accident or emergency, or for repair, alterations, replacements or improvement.

 

	
14.  

	
No carpet, rug or other article shall be hung or shaken out of any window of the Building; and Tenant shall not sweep or throw or permit to be swept or thrown from the Premises any dirt or other substances into any of the corridors or halls, elevator, or out of the doors or windows or stairways of the Building.  Tenant shall not use, keep or permit to be used or kept any foul or noxious gas or substance in the Premises, or permit or suffer the Premises to be occupied or used in a manner offensive or objectionable to Landlord or other occupants of the Building by reason of noise, odors and/or vibrations, or interfere in any way with other tenants or those having business therein, nor shall any animals or birds be kept in or about the Building.  Smoking or carrying lighted cigars or cigarettes in the elevators of the Building is prohibited.

 

	
15.  

	
Landlord reserves the right to exclude from the Building on weekdays between the hours of 6:00 p.m. and 8:00 a.m. and at all hours on weekends and legal holidays, all persons who do not present a pass to the Building signed by Landlord; provided, however, that reasonable access for Tenant's employees and customers shall be accorded.  Landlord will furnish passes to persons for whom Tenant requires same in writing.  Tenant shall be responsible for all persons for whom it requests such passes and shall be liable to Landlord for all acts of such persons.

 

	
16.  

	
Tenant agrees to keep all windows closed at all times and to abide by all rules and regulations issued by Landlord with respect to the Building's air conditioning and ventilation systems.

 

	
17.  

	
If damaged or broken by Tenant, its employees, agents or contractors, Tenant will replace all broken or cracked plate glass windows and doors at its own expense, with glass of like kind and quality.

 

 

  

Exhibit E

  

 

 

	
18.  

	
In the event it becomes necessary for Landlord to gain access to the underfloor electric and telephone distribution system for purposes of adding or removing wiring, then upon request by Landlord, Tenant will allow Landlord to temporarily remove the carpet over the access covers to the underfloor ducts for such period of time until work to be performed has been completed.  The cost of such work shall be borne by Landlord except to the extent such work was requested by or is intended to benefit Tenant or the Premises, in which case the cost shall be borne by Tenant.

 

Violation of these rules, or any amendments thereof or additions thereto, may be considered a default of Tenant's lease and shall be sufficient cause for termination of this Lease at the option of Landlord.

Landlord may waive any one or more of these Rules and Regulations for the benefit of any particular Building tenant or tenants, but no such waiver by Landlord shall be construed as a waiver of such Rules and Regulations in favor of any other Building tenant or tenants, nor prevent Landlord from thereafter enforcing any such Rules and Regulations against any or all of the tenants of the Building.

These Rules and Regulations are in addition to, and shall not be construed to in any way modify or amend, in whole or in part, the terms, covenants, agreements and conditions of any lease of any premises in the Building, including the Lease to which this Exhibit “E” is attached.

Landlord reserves the right to amend, modify and/or revoke any or all of these rules and regulations, and to add or make such other reasonable rules and regulations, as in its judgment may from time to time be needed for the safety, care, and cleanliness of the Building, and for the preservation of good order therein.

  

Exhibit E

  

 

EXHIBIT “F”

TENANT IMPROVEMENTS

For purposes of this Exhibit, capitalized terms shall have the meanings ascribed to them in the Lease unless otherwise defined herein.

Section 1. Tenant Improvement Definitions.

The term "Building Standard" or "Building Standards" shall mean the quality and quantities of materials shown for a given category on the Annex attached hereto (if applicable), or otherwise, typically employed by Landlord for standard improvements elsewhere in the Building (if no Annex is attached hereto).

The term “Preliminary Plans” shall mean the preliminary space plan for the Tenant Improvements prepared by JZA+D (the “Architect”), identified as Antares Proposed Plan, dated January 27, 2012 (a copy of which is attached hereto).

The term “Tenant Improvements” shall mean all improvements constructed or installed in or on the Premises in accordance with the Preliminary Plans, the Drawings and Specifications and Building Standards, as hereinafter defined, other than Tenant Work.

The term “Tenant Improvement Costs” shall mean the actual aggregate cost for completing the Tenant Improvements, inclusive of, but not limited to (i) the costs of preparing the Preliminary Plans, the Drawings and Specifications, and the As Built Plans (all as defined below) and (ii) a three percent (3%) construction management fee.

The term “Tenant Work” shall mean (A) any construction and/or installations of improvements, furniture, fixtures and equipment that (i) is specifically noted in the Preliminary Plans, Drawing and Specifications, or otherwise in this Exhibit “F”, as Tenant Work, and/or (ii) involves quantities or quality of materials that are greater than, or more costly than, that applicable to Building Standard improvements, and (B) specialized work in the Premises which is not to be performed by Landlord, such as telephone installation, installation of computer and other specialized equipment, special cabinetwork and millwork, and other similar decorative, cosmetic and non-structural alterations, additions or installations to the Premises which do not affect any Building systems, structure, or areas outside of the Premises, in each case installed within the Premises by Tenant with Landlord’s prior approval.

Section 2.  Drawings and Specifications.

Section 2.01.  Definition.

The term “Drawings and Specifications” shall mean the final drawings, specifications, and finish schedules for the Tenant Improvements which consist of the following: (a) Architectural Plans prepared by Architect, dated 12/16/2011, numbered A1-0, A1-1, A1-2, A1-3, A2-1, A8-1, A8-2, A12-1; and (b)Engineering Plans dated 12/16/11 numbered E-001, E-002, E-101, E-201, E-501, FP-001, FP-101, M-001, M-002, M-101, M-601, P-001, P-101, T1-0, and T2-0 prepared by CHA, Princeton, NJ.

 

 

  

Exhibit F

  

In addition to the construction reflected on the Drawings and Specifications, clerestory glass shall be provided for all offices, the copy room and the storage room (but not in the conference rooms, the server room or the lunch room).

Landlord is fully authorized to proceed with obtaining any necessary approval and permits and, through Landlord’s Contractor, with the work of constructing and installing the Tenant Improvements in accordance with the Drawings and Specifications.  Except as provided herein, no material deviation from the Drawings and Specifications shall be made by either Party except by written change order approved by the other Party (“Change Order”), which if such Change Order is requested by Tenant, shall be subject to the same standards of review that apply to Tenant alterations pursuant to Section 6.7 of the Lease, and which shall not otherwise be unreasonably withheld, conditioned or delayed.  If Tenant requests or causes the need for any Change Orders, any net increase in cost associated with such Change Orders shall be at Tenant's sole cost and expense and shall be payable within ten business days after Landlord’s written demand (and any delay in the commencement, performance or completion of the Tenant Improvements occurring as a result thereof shall constitute a “Tenant Delay” hereunder).

Section 2.02.  As-Built Plans

Following the completion of the Tenant Improvements and no later than thirty (30) days after the Commencement Date, Landlord may, at is option, request that the Architect prepare and deliver as-built plans for the Tenant Improvements in auto-cad format (together with a hard copy thereof, reflecting all alterations, improvements and other changes to the Building and Premises occurring as a result of the construction or installation of the Tenant Improvements and any Tenant Work.

Section 3.  Tenant Improvements.

Section 3.01.  Performance of the Tenant Improvements.

Provided that there is no Event of Default by Tenant or event which, except for the passage of time, the giving of notice, or both, would constitute an Event of Default by Tenant, Landlord shall, in a good and workerlike manner, cause the Tenant Improvements to be completed in accordance with the Drawings and Specifications and the Building Standards.  Landlord shall engage a general contractor selected by Landlord for the performance of the Tenant Improvements. Landlord reserves the right (i) to make substitutions of material of equivalent grade and quality when and if any specified material shall not be readily and reasonably available, and (ii) to make changes necessitated by conditions met during the course of construction, provided that Tenant's approval of any substantial change shall first be obtained (which approval shall not be unreasonably withheld or delayed so long as there shall be general conformity with the Drawings and Specifications).

Section 3.02.  Tenant Access.

 

 

  

Exhibit F

  

Landlord shall afford Tenant and its employees, agents and contractors access to the Premises, at reasonable times prior to the Commencement Date, and at Tenant's sole risk and expense, for the purposes of inspecting and verifying the performance and completion of the Tenant Improvements.  Tenant shall inspect the performance of Tenant Improvements regularly and diligently and shall advise Landlord promptly of any objections to the performance of such work.  Access for such purposes shall not be deemed to constitute possession or occupancy.  Landlord shall promptly undertake and diligently prosecute the correction of any defective work of which it is notified as aforesaid.  Any entry in the Premises by the Tenant or Tenant’s agents, contractors or employees pursuant to this Section 3.02 prior to Substantial Completion of the Tenant Improvements: (i) shall be subject to the insurance requirements of this Lease as if Tenant were in occupancy of the Premises; (ii) shall comply with all applicable laws and Governmental Requirements, as well as any and all reasonable construction scheduling requirements of Landlord; and (iii) shall be conducted in a manner which does not hinder, disrupt, interfere with or otherwise cause delay in (or increase the cost of) commencing, performing and/or Substantial Completing the Tenant Improvements.  In the event of any hindrance, disruption, interference or delay in commencing, performing and/or Substantial Completing the Tenant Improvements due to a breach by Tenant of any of the foregoing requirements, or otherwise due to the acts and/or omissions of Tenant, or its agents, employees, contractors and/or consultants occurring during the course of any entries into the Premises under this Paragraph, the same shall be deemed to constitute a Tenant Delay hereunder, and Tenant will pay all additional costs and expenses arising therefrom.  In addition, Tenant shall bear the full risk of loss for all materials, equipment or other property that are brought into or stored in the Building or the Premises prior to the Commencement Date (which storage shall be subject to Landlord’s approval in its sole discretion).

Section 4.  Payment of Costs.

Section 4.01. Landlord’s Costs.

Landlord shall pay the Tenant Improvement Costs at its sole cost and expense.

Section 4.02.  Tenant’s Costs.

To the extent paid by Landlord, Tenant shall reimburse Landlord, as additional rental, all costs of Tenant Work as well as the cost of making any and all changes in and to the Drawings and Specifications and any and all increased Tenant Improvement Costs, including construction management fees, resulting therefrom.  The aggregate of all such costs described in this Section 4.02 are hereinafter referred to collectively as “Tenant’s Costs.”

Section 4.03.  Payment Schedule for Tenant’s Costs.

Tenant’s Costs shall be due and payable by Tenant within five (5) business days following Tenant’s receipt of an invoice therefor, and prior to the commencement of construction by Landlord’s Contractor.

 

 

  

Exhibit F

  

Section 4.04.  Changes in Drawings and Specifications.

If at any time after the Tenant Improvement Costs are determined Tenant desires to make changes in the Drawings and Specifications, Tenant shall submit to Landlord for approval working drawings and specifications for any and all such desired changes, provided that any delay in the commencement or completion of the Tenant Improvements as a result of any such changes requested by Tenant shall be deemed to constitute a Tenant Delay hereunder.  Landlord shall review and either approve or disapprove the working drawings and specifications submitted by Tenant within five (5) business days.  If Landlord disapproves of the submittal, Landlord and Tenant will work together with the Architect, in good faith, to resolve any disputes or differences that arise with respect to Landlord’s disapproval of any aspect of such drawings and specifications, and Tenant will cause the Architect to resubmit revised drawings and specifications to Landlord reflecting the agreed resolution of such issues for Landlord’s approval promptly thereafter (which approval shall not be unreasonably withheld, conditioned or delayed).  Once any and all changes and modifications are approved, Landlord shall promptly submit the same to Landlord’s Contractor for pricing.  The procedure for determining an approved cost for such changes shall be as set forth in Section 2 above.  Once the cost for such changes has been approved, all references in this Agreement to “Drawings and Specifications” shall be to the Drawings and Specifications adopted pursuant to the procedures of Section 2 above, as changed and modified pursuant to this Section.  Once the changes and the costs therefor have been approved, Tenant shall be deemed to have given full authorization to Landlord to proceed with the work of constructing and installing the Tenant Improvements (and any Tenant Work to be performed by Landlord at Tenant’s expense) in accordance with the Drawings and Specifications, as so changed and modified.  Landlord shall have the optional right to require Tenant to pay in one lump sum to Landlord, in advance of commencement of work, any and all increases in the Tenant Improvement Costs which result from approved changes to the Drawings and Specifications.

Section 4.05.  Failure to Pay Tenant’s Costs.

Failure by Tenant to pay Tenant’s Costs in accordance with this Section 4 will constitute a failure by Tenant to pay rent when due under the Lease and shall therefor constitute an Event of Default by Tenant under the Lease, and Landlord shall have all of the remedies available to it under the Lease and at law or in equity for nonpayment of rent.

Section 4.06.  Landlord’s Payment Obligations.

Provided that there is no Event of Default by Tenant or event which, except for the passage of time, the giving of notice, or both, would constitute an Event of Default by Tenant, Landlord agrees to pay the Tenant Improvement Costs as and when the same become due and payable.  Landlord shall be entitled to rely on the accuracy of any and all invoices and fee statements for labor and materials performed on or furnished to the Premises in connection with the Tenant Improvements and to rely, to the extent submitted, on any and all certifications as to Tenant Improvement Costs submitted by Landlord’s Contractor and/or Tenant’s Architect.

 

 

  

Exhibit F

  

Section 5.  Tenant’s Contractors.

Tenant may, at its sole expense, select and employ its own contractors for specialized or finishing work in the Premises which is not to be performed by Landlord and which is reflected as such in the Preliminary Plans or Drawings and Specifications (as the case may be), such as carpeting, telephone installation, installation of computer and other specialized equipment, special cabinetwork and millwork, and other similar decoration and installation, all of which shall constitute Tenant Work under this Exhibit “F”, and all of which shall be subject to the qualifications, conditions and limitations with respect to the performance of Tenant Work set forth in Subsection 6.7 of the Lease.

Tenant's contractors and subcontractors shall be subject to the general administrative supervision of Landlord's Contractor for scheduling purposes, but Landlord's Contractor shall not be responsible for any aspect of the work performed by Tenant's contractors or subcontractors, or for the coordination of the work of Landlord's Contractor and subcontractor(s) with Tenant's contractors or subcontractors.

Section 6.  Tenant Delay.

 

Article I. A “Tenant Delay” shall be deemed to include, without limitation, any delay in the commencement, performance, Substantial Completion or final completion of the Tenant Improvements which is attributable to any one or more of the following causes: (a) late submissions of information needed by Landlord to perform its obligations hereunder; (b) any changes requested by Tenant to the Drawings and Specifications or the Tenant Improvements; (c) delays in obtaining non-Building Standard construction materials requested by Tenant; (d) Tenant’s failure to timely approve any item requiring Tenant’s approval; (e) delays by Tenant in meeting the deadlines set forth herein; (f) the performance by Tenant or Tenant’s contractors of any improvement or any other related work at or about the Premises or the Property; (g) any act or omission of Tenant, Tenant’s Architect or Tenant’s contractors, (h) any breach by Tenant of any provision contained in this Exhibit or in the Lease, (i) any disruption or interference in the performance of the Tenant Improvements occurring in the course of any entry into the Premises pursuant to Section 3.02 of this Exhibit “F”, (j) any failure by Tenant to construct and install any Tenant Work, or to perform any other installations of furniture, fixtures and equipment in the Premises properly and in accordance with applicable Governmental Requirements which results in a governmental authority denying the issuance of an Occupancy Permit for the Premises, and/or (k) any failure of Tenant to cooperate with Landlord or otherwise act with diligence and in good faith in order to cause the Tenant Improvements to be designed, approved and constructed in a timely manner.

 

Section 7.  Landlord’s Role.

The parties acknowledge that Landlord is not an architect, contractor or engineer and that the Tenant Improvements will be designed and performed by independent architects, engineers and contractors.  Landlord shall have no responsibility for the design of, or for construction means, methods or techniques or safety precautions in connection with, the Tenant Improvements.  Landlord’s approval or provision of the Preliminary Plans and/or the Drawings and Specifications for the Tenant Improvements, or other submissions, materials, drawings, plans or specifications pertaining thereto, will create no responsibility or liability on the part of Landlord for the completeness, design sufficiency, or compliance with any or all laws, rules and regulations of governmental agencies or authorities with respect thereto or with respect to the Tenant Improvements constructed in conformity therewith.  Tenant, in reviewing the Drawings and Specifications and Tenant Improvements, shall have the right, opportunity and obligation to check for any errors, omissions or defects.

  

Exhibit F

  

 

 

 

 

Exhibit "F-1"

 

 

 

  

  

  

 

Preliminary

 

 

 

 

 

 

  

  

  

 

 

 

 

 

Plan

 

  

  

  

  

  

  

 

 

Princeton South Corporate Center

Ewing Township, New Jersey

Tenant Building Standard Specifications

 

General Requirements:

All architectural and engineering designs shall conform to the requirements of the ADA.  All new construction and future renovations shall comply with the ADA.

All new construction and future renovations shall be designed and built in compliance with all local regulations, local zoning ordinances and state building codes.

The information provided herein, and the manufacturers listed, are intended to provide for the minimum quality standard of construction.  Substitutions must be identified at the time of bid or may be entertained but must be approved in writing.

Reference the base building core and shall specifications for descriptions of all base building components.

Partitions:

Building Standard Interior Partition:

Walls to be constructed of 3-5/8” wide, metal studs at 24” on center with one layer of 5/8” gypsum board on each side, height to underside of acoustical ceiling tile.

Building Standard Perimeter Wall:

Walls to be finished with one layer of 5/8” gypsum board, height to approximately four inches (4”) above standard ceiling height.

Tenant Area Demising Partitions (Tenant Separation):

Walls to be constructed of 3-5/8” metal studs at 24” on center with one layer of 5/8” gypsum board each side with batt insulation full height.  The height of the partition will be to the underside of the structure above.

 

Suspended Acoustical Ceilings:

 

A 2’x4’ tegular edge, Armstrong second look or equal lay-in acoustical tile ceiling with

 

15/16” wide exposed “T” suspension system with a ceiling height of 9’-0” in tenants demised areas.

  

  

  

Doors, Frames and Hardware:

General:

All interior doors to be solid core stain grade with manufacturer’s standard finish.  Doors, hardware and frames to match building shell.  All interior frames will be standard profile, 2” wide, hollow metal frames with paint grade finish.  Hardware to be lever style with US26D brushed chrome finish.  Passive hardware shall be furnished and installed as manufactured by Arrow, Schlage, Russwin, Corbin or equal to meet ADA requirements with functions appropriate for intended use.  Lock sets will be included as an upgrade.

Interior Office Doors:

Shall be 3’-0”W x 8’-0”H x 1-3/4” solid core maple factory pre-finished stained.  Each door will be equipped with a lever type latchset, floor mounted door stops, silencers and three (3) hinges.

Suite Entry Double Doors:

Shall be (2) 3’-0”W x 8’-0”H x 1-3/4”. fire rated where required. solid core stain grade with side-lites.  Each door will be equipped with a lever type latchset, standard lockset, closer, silencers and three (3) hinges.

Painting:

For application to gypsum board or plaster surfaces, paint shall be latex base, flat finish.  For application to metal door frames, paint shall be alkyd base, semi-gloss finish.  All surfaces to be primed one coat and finished with two coats of standard paint.

Carpet & Base:

All leased office floor area shall be one color direct glue down, 30 oz. Cut pile or 26 oz. level loop carpet in color as selected by the Tenant from samples provided by the Landlord.  4” vinyl cove base shall be installed at all vertical faces in selected color.  Wood or carpet base are available as an upgrade.

Window Treatments:

One (1) inch aluminum horizontal mini blinds shall be included at each exterior window as part of base building core and shell work.

Signage:

Signage, other than code required as described in base building core and shell specifications, will be provided by the tenant.  In addition to the code required signage the tenant’s name and suite number will be provided on the illuminated building directory at the landlord’s cost.

 

 

  

  

  

 

Fire extinguishers and Cabinets:

Tenant to provide fire extinguisher cabinets containing approved fire extinguishers within tenant space in the quantity and location per code and local requirements.  Cabinets shall be semi-recessed as manufactured by Larson or equal.  Finish to be stainless steel.

Fire Protection System:

The building is equipped with an ordinary hazard automatic sprinkler system utilizing upright or pendent type heads with a brass finish.  Additional heads necessary to satisfy code and turning heads down are a tenant improvement cost.  All heads are to be aligned and no closer than 4” to the ceiling grid.  Sprinkler heads shall be standard chrome semi-recessed.

Heating, Ventilation and Air Conditioning:

Reference the base building core and shell specifications for the base building mechanical system description.

Secondary air distribution, thermostat and sensor installation, flexible ductwork and grilles and registers shall be provided under the tenant finish portion of the project.

Diffusers shall be 24”x24”, three-cone aluminum, white finish painted or equal at the interior of the tenant space, and linear slot diffusers at the perimeter of the tenant space.  Return grilles shall be 24”x24”, white painted finish or equal.

 

Electrical:

Reference the base building core and shell specifications for the base building electrical system description.

Power:

Tenant standard total power requirements will be allocated based upon the following demand allowances per square foot of rentable area:

 

 

	
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Lighting:  2 watts per s.f.

	
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Power wiring for outlets, equipment:  5 watts per s.f.

	
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Riser capacity:  9 watts per s.f.

Total capacity:  16 watts per s.f.

Lighting: Building standard fixtures shall be 2’x4’ lay-in, deep cell parabolic lenses.

Exit Lights: Provided as required by code and local regulations.

Switches:

 

 

 

  

  

  

Wall switches shall be single pole, quiet toggle type with metal cover plates in the quantity of one per building standard door opening or not to exceed one per 150 rentable square feet.

Receptacles:

Standard 120V receptacles will be provided at an allowance of one per 15 linear feet of drywall office partition space.  Cover plate finish to be metal.

Telephone/Data:

Tenant shall coordinate and pay for the installation of all telephone/data receptacles within the demised premises.  Work to be performed in accordance with the Landlord’s schedule, safety and insurance requirements.

Fire Alarm System:

Base building shall have an addressable fire alarm system capable of expansion into the tenant’s demised space.  Tenant work shall include installation of smoke detectors, voice evacuation speakers, audible and visual devices (i.e. exit signs and emergency lights) and additional pull stations as required by NFPA, ADA and local fire codes.  Tenant to pay cost of connecting to the building fire alarm panel by the building fire alarm vendor.

Exclusions:

	
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Modifications to the structural systems, including folding partitions, to accommodate filing systems or any other extraordinary floor loads.

	
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Elevator lobby finishes for full floor tenants.

	
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Draperies and interior window blinds.

	
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All data and telephone cabling, security systems and associated racking of systems.

 

 

  

  

  

 

 

 

EXHIBIT “G”

TENANT ESTOPPEL CERTIFICATE

 

TO:           _________________________________ (“Buyer”)

____________________________ (“Lender”)

	
RE:

	
Lease dated ____________, 20__ (together with any modifications listed in Paragraph 2 below, collectively referred to as the “Lease”), between _____________________________ (“Landlord”) and ______________________________ (“Tenant”), covering office space identified as Suite _____ (the “Premises”) in the Princeton South Corporate Center Condominium – Unit 1, located at 100 Charles Ewing Boulevard, Ewing Township, Mercer County, New Jersey (the “Project”).

 

This Estoppel Certificate is being delivered to Buyer [and Lender] by Tenant in accordance with the terms of the Lease.  Tenant understands that Buyer will rely on this Estoppel Certificate in purchasing the Project [, and that Lender will rely on this Estoppel Certificate in making a loan to Buyer for that purpose].  The undersigned, acting on behalf of Tenant, and in accordance with the terms of the Lease, certifies to Buyer [and Lender] as follows:

 

1. The Lease has been properly executed and delivered by Tenant, is a binding obligation of Tenant and is in full force and effect.  The Lease constitutes the entire agreement between Landlord and Tenant in connection with the Premises.

 

2. There are no amendments, modifications, supplements, side letters, arrangements or other understandings, written or oral, of any sort, relating to the Lease, except for the following: ______________________________________________.  [insert “None” if none].  A full and accurate copy of the Lease, including any and all amendments, modifications, supplements, side letters and other agreements, is attached hereto.

 

3. Tenant has entered into occupancy of the Premises, and is operating its business in the Premises in accordance with the terms of the Lease.  All of Landlord’s improvements have been completed and the Premises have been delivered by Landlord, and accepted by Tenant, in accordance with the terms of the Lease.  Tenant has received all financial allowances due from Landlord in connection with Tenant’s occupancy or improvement of the Premises.

 

4. No monetary amounts are owed by Landlord to Tenant under the Lease, except for the return of the security deposit, if any, specified in the Lease.

 

5. All obligations of Landlord under the Lease have been performed to date, and Landlord is not in default under the Lease, nor is Tenant aware of any circumstance, condition or state of facts which, after notice and/or the passage of time, would constitute such a default.   As of this date, Tenant has no claims, defenses, liens, offsets or charges against Landlord that would prevent the full enforcement of the Lease by Landlord against Tenant.

 

6. Tenant is not in default under the Lease, nor is Tenant aware of any circumstance, condition or state of facts which, after notice and/or the passage of time, would constitute such a default.

 

7. Tenant has not transferred, assigned or subleased, or agreed to transfer, assign or sublease, its interest in the Lease or the Premises or any part thereof.

 

 

 

 

  

Exhibit G

  

 

 

 

8. The current term of the Lease commenced on _______________, and will expire on _________________.  Tenant has the following options to extend the term of the Lease: __________________________________________.  [insert “None” if none]

 

9. The Premises contains _______ square feet of rentable area.

 

10. Except as expressly provided in the Lease, Tenant has no options, rights of first refusal or other rights to (a) cancel or terminate the Lease, in whole or in part, prior to the expiration of the term, (b) expand or reduce the size of the Premises, or (c) lease any other portion of the Project.

 

11. Except as expressly provided in the Lease, Tenant has no options, rights of first refusal or other rights to purchase the Project or any portion of the Project.

 

12. The current monthly base or minimum rent payable under the Lease is $_____________, and the current monthly total of additional rent payable under the Lease for taxes and operating expenses is $______________.  All monthly base or minimum rent, and all additional rent, has been paid through _____________, 201__.  No monthly base or minimum rent, or additional rent, has been paid more than thirty (30) days in advance of its due date.  There are no agreements, written or oral, providing for the discount, advance payment, abatement or set off of any rent or other amounts payable under the Lease, and there is no “free rent” or other rent concession during the remaining term of the Lease.

 

13. The amount of the security deposit deposited by Tenant and held by Landlord under the Lease is $_________________.  [insert “None” if none]

 

14. The Lease has been guaranteed by _____________________ [insert “None” if none].

 

15. Tenant is currently entitled to use __________ non-reserved parking spaces at a monthly cost payable to Landlord of $_________ per space, and __________ reserved parking spaces at a monthly cost payable to Landlord of $_________ per space.

 

16. There has not been filed by or against, nor is there threatened against or contemplated by Tenant, a petition in bankruptcy, voluntary or otherwise, any assignment for the benefit of creditors, any petition seeking reorganization or arrangement under the bankruptcy laws of the United States or the debtor relief laws of any state or any other action brought under such bankruptcy or debtor relief laws.

 

17. The term “Landlord” shall include any successor or assign of the Landlord named above including, but not limited to, Buyer.  The term “Buyer” shall include any successor or assign of the Buyer named above.  [The term “Lender” shall include any successor or assign of the Lender named above.]

 

 IN WITNESS WHEREOF, Tenant has executed and delivered this Tenant Estoppel Certificate as of ______________________, 201__.

 

 

	 	TENANT:	 
	 	 	 
	 	 	 
	 	 	 
	 	 	 
	 	By:	 	 
	 	 	 Name:                                                  	 
	 	 	 Title:                                                     	 
	 	 	 	 

 

 

 

 

 

 

  

Exhibit G

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