Document:

Exhibit 10.5
	 

	 
		

	 

	 
		

	 

	 
		

	 

	 
		

	 

	 
	 

	 
		

	 

	 
		

	 

	 
		

	 

	 
		

	 

	 
		

	 

	 
		CARE INVESTMENT TRUST INC.
	 

	 
		MANAGER EQUITY PLAN
	 

	 
		

	 

	 
		
 

	 

	 
		

	 

	 
		

	 

	 
 
	 
		

	 

	 
		

	 

	 
		CARE INVESTMENT TRUST INC.
	 

	 
		MANAGER EQUITY PLAN
	 

	 	 	 	 
	 	 	 
	 	 	 
	 	 	 
	 	 	 
	
			 
				 
			 

		  	
			 
				Section
			 

		  	
			 
				Page
			 

		  
	
			 
				 
			 

		  	
			 
				 
			 

		  	
			 
				 
			 

		  
	
			 
				1.
			 

		  	
			 
				Purpose; Types of Awards; Construction.
			 

		  	
			 
				1
			 

		  
	
			 
				2.
			 

		  	
			 
				Definitions.
			 

		  	
			 
				1
			 

		  
	
			 
				3.
			 

		  	
			 
				Administration.
			 

		  	
			 
				3
			 

		  
	
			 
				4.
			 

		  	
			 
				Eligibility.
			 

		  	
			 
				4
			 

		  
	
			 
				5.
			 

		  	
			 
				Stock Subject to the Plan.
			 

		  	
			 
				4
			 

		  
	
			 
				6.
			 

		  	
			 
				Terms of Awards.
			 

		  	
			 
				5
			 

		  
	
			 
				7.
			 

		  	
			 
				Termination of Management Agreement.
			 

		  	
			 
				11
			 

		  
	
			 
				8.
			 

		  	
			 
				Change in Control.
			 

		  	
			 
				11
			 

		  
	
			 
				9.
			 

		  	
			 
				General Provisions.
			 

		  	
			 
				12
			 

		  

	 
		

	 

	 
		

	 

	 
		
 

	 

	 
		

	 

	 
		

	 

	 
 
	 
		

	 

	 
		Approved: June 21, 2007
	 

	 
		

	 

	 
		CARE INVESTMENT TRUST INC.
	 

	 
		MANAGER EQUITY PLAN
	 

	 
		
	 

	 
		1.
	 

	 
		Purpose; Types of Awards; Construction.
	 

	 
		The purposes of the Care Investment Trust Inc. Manager Equity Plan (the
		“Plan”) are to issue equity-based incentives to CIT Healthcare LLC, a
		Delaware limited liability company, or any successor thereto (the
		“Manager”),which may in turn issue incentives to the employees of the
		Manager or of the Manager's Affiliates in order to increase their efforts on
		behalf of the Company and its subsidiaries and to promote the success of the
		Company's business.  The Plan provides for the grant of stock options,
		stock appreciation rights, restricted stock, restricted stock units and other
		equity-based awards.
	 

	 
		
	 

	 
		2.
	 

	 
		Definitions.
	 

	 
		For purposes of the Plan, the following terms shall be defined as set
		forth below:
	 

	 
		(a)
	 

	 
		“Affiliate” means (i) any Person directly or indirectly
		controlling, controlled by, or under common control with such other Person,
		(ii) any executive officer or general partner of such other Person and (iii)
		any legal entity for which such Person acts as an executive officer or general
		partner.
	 

	 
		(b)
	 

	 
		“Award” means any Option, Stock Appreciation Right, Restricted
		Stock, Restricted Stock Unit or Other Stock-Based Award granted under the Plan.

	 

	 
		(c)
	 

	 
		“Award Agreement” means any written agreement, contract or
		other instrument or document evidencing an Award.
	 

	 
		(d)
	 

	 
		“Board” means the Board of Directors of the Company.
	 

	 
		(e)
	 

	 
		“Change in Control” means:
	 

	 
		(i)  Any person becomes the beneficial owner, directly or
		indirectly, of securities of the Company representing thirty-five percent (35%)
		or more of the combined voting power of the Company’s then outstanding
		securities; or  
	 

	 
		(ii)  The following individuals cease for any reason to
		constitute a majority of the number of directors then serving: individuals who,
		on the Effective Date, constitute the Board and any new director (other than a
		director whose initial assumption of office is in connection with an actual or
		threatened election contest, including, but not limited to, a consent
		solicitation, relating to the election of directors of the Company) whose
		appointment or election by the Board or nomination for election by the
		Company’s stockholders was approved or recommended by a vote of at least a
		majority of the directors then still in office who either were directors on the
		Effective Date or whose appointment, election or nomination for election was
		previously so approved or recommended; or  
	 

	 
		
 

	 

	 
		

	 

	 
		

	 

	 
 
	 
		

	 

	 
		

	 

	 
		(iii)   There is consummated a merger or consolidation of the
		Company or any Subsidiary with any other corporation, other than (A) a merger
		or consolidation which would result in the voting securities of the Company
		outstanding immediately prior to such merger or consolidation continuing to
		represent (either by remaining outstanding or by being converted into voting
		securities of the surviving entity or any parent thereof), in combination with
		the ownership of any trustee or other fiduciary holding securities under an
		employee benefit plan of the Company or any Subsidiary of the Company, more
		than fifty percent (50%) of the combined voting power of the securities of the
		Company or such surviving entity or any parent thereof outstanding immediately
		after such merger or consolidation, or (B) a merger or consolidation effected
		to implement a recapitalization of the Company (or similar transaction) in
		which no person is or becomes the beneficial owner, directly or indirectly, of
		securities of the Company representing thirty-five percent (35%) or more of the
		combined voting power of the Company’s then outstanding securities; or
		 
	 

	 
		(iv)   The stockholders of the Company approve a plan of
		complete liquidation or dissolution of the Company or there is consummated an
		agreement for the sale or disposition by the company of all or substantially
		all of the Company’s assets, other than a sale or disposition by the
		company of all or substantially all of the Company’s assets to an entity,
		more than fifty percent (50%) of the combined voting power of the voting
		securities of which are owned by stockholders of the Company in substantially
		the same proportions as their ownership of the Company immediately prior to
		such sale.  
	 

	 
		Notwithstanding the foregoing, with respect to an Award that is subject
		to Section 409A of the Code and the payment or settlement of the Award will
		accelerate upon a Change in Control, no event set forth herein will constitute
		a Change in Control for purposes of the Plan or any Award Agreement unless such
		event also constitutes a “change in ownership,” “change in
		effective control,” or “change in the ownership of a substantial
		portion of the Company’s assets” as defined under Section 409A of the
		Code.
	 

	 
		(f)
	 

	 
		"Code" means the Internal Revenue Code of 1986, as amended from time to
		time, and the rules and regulations promulgated thereunder.
	 

	 
		(g)
	 

	 
		"Committee" means the committee, if any, established by the Board to
		administer the Plan.  
	 

	 
		(h)
	 

	 
		"Company" means Care Investment Trust Inc., a Maryland corporation, or
		any successor corporation.
	 

	 
		(i)
	 

	 
		"Effective Date" means the date on which the Plan is adopted by the
		Board, subject to obtaining the approval of the Company's stockholder(s).
	 

	 
		(j)
	 

	 
		"Exchange Act" means the Securities Exchange Act of 1934, as amended from
		time to time, and the rules and regulations promulgated thereunder.
	 

	 
		(k)
	 

	 
		"Fair Market Value" means, with respect to Stock or other property, the
		fair market value of such Stock or other property determined by such methods or
		procedures as shall be established from time to time by the Board.  Unless
		otherwise determined by the Board in good faith, the per
	 

	 
		
 

	 

	 
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		share Fair Market Value of Stock as of a particular date shall mean (i)
		the closing sales price per share of Stock on the national securities exchange
		on which the Stock is principally traded for such date; (ii) if the shares of
		Stock are then traded in an over-the-counter market, the closing bid price for
		the shares of Stock in such over-the-counter market for such date; or (iii) if
		the shares of Stock are not then listed on a national securities exchange or
		traded in an over-the-counter market, such value as the Board, in its sole
		discretion, shall determine.
	 

	 
		(l)
	 

	 
		"Management Agreement" means the Management Agreement expected to be
		entered into by and between the Company and the Manager, as such may be amended
		from time to time.
	 

	 
		(m)
	 

	 
		"Option" means a right, granted to the Manager under Section 6(b)(i), to
		purchase shares of Stock.
	 

	 
		(n)
	 

	 
		"Other Stock-Based Award" means a right or other interest granted to the
		Manager that may be denominated or payable in, valued in whole or in part by
		reference to, or otherwise based on, or related to, Stock, including but not
		limited to unrestricted shares of Stock.
	 

	 
		(o)
	 

	 
		"Plan" means this Care Investment Trust Inc. Manager Equity Plan,
		as amended from time to time.
	 

	 
		(p)
	 

	 
		"Restricted Stock" means an Award of shares of Stock to the Manager under
		Section 6(b)(iii) that may be subject to certain restrictions and to a risk of
		forfeiture.
	 

	 
		(q)
	 

	 
		"Restricted Stock Unit" or "RSU" means a right granted to the Manager
		under Section 6(b)(iv) to receive Stock, cash or other property at the end of a
		specified period, which right may be conditioned on the satisfaction of
		specified performance or other criteria.
	 

	 
		(r)
	 

	 
		"Securities Act" means the Securities Act of 1933, as amended from time
		to time, and the rules and regulations promulgated thereunder.
	 

	 
		(s)
	 

	 
		"Stock" means shares of the common stock, par value $0.001 per share, of
		the Company.
	 

	 
		(t)
	 

	 
		"Stock Appreciation Right" or "SAR" means the right granted to the
		Manager under Section 6(b)(ii) to be paid an amount measured by the
		appreciation in the Fair Market Value of Stock from the date of grant to the
		date of exercise of the right.
	 

	 
		
	 

	 
		3.
	 

	 
		Administration.
	 

	 
		The Plan shall be administered by the Board.  Except with respect to
		the amendment, modification, suspension or early termination of the Plan, the
		Board may
	 

	 
		
 

	 

	 
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		appoint a Committee to administer all or a portion of the Plan.  To
		the extent that the Board so delegates its authority, references herein to the
		Board shall be deemed references to the Committee.  The Board may delegate
		to one or more agents such administrative duties as it may deem advisable, and
		the Committee or any other person to whom the Board has delegated duties as
		aforesaid may employ one or more persons to render advice with respect to any
		responsibility the Board or such Committee or person may have under the Plan.
		 No member of the Board or Committee shall be liable for any action taken
		or determination made in good faith with respect to the Plan or any Award
		granted hereunder.
	 

	 
		The Board shall have the authority in its discretion, subject to and not
		inconsistent with the express provisions of the Plan, to administer the Plan
		and to exercise all the powers and authorities either specifically granted to
		it under the Plan or necessary or advisable in the administration of the Plan,
		including, without limitation, the authority to:  (i) grant Awards; (ii)
		determine the time or times at which Awards shall be granted; (iii) determine
		the type and number of Awards to be granted, the number of shares of Stock to
		which an Award may relate and the terms, conditions, restrictions and
		performance criteria relating to any Award; (iv) determine whether, to what
		extent, and under what circumstances an Award may be settled, cancelled,
		forfeited, exchanged, or surrendered; (v) accelerate the vesting of an Award,
		(vi) make adjustments in the terms and conditions of Awards; (vii) construe and
		interpret the Plan and any Award; (viii) prescribe, amend and rescind rules and
		regulations relating to the Plan; (ix) determine the terms and provisions of
		the Award Agreements (which need not be identical for each Participant); and
		(x) make all other determinations deemed necessary or advisable for the
		administration of the Plan.  All decisions, determinations and
		interpretations of the Board shall be final and binding on all persons,
		including but not limited to the Company, the Manager or any Affiliate of the
		Company or the Manager (or any person claiming any rights under the Plan from
		or through the Manager) and any stockholder.  Notwithstanding any
		provision of the Plan or any Award Agreement to the contrary, except as
		provided in the second paragraph of Section 5, neither the Board nor the
		Committee may take any action which would have the effect of reducing the
		aggregate exercise, base or purchase price of any Award without obtaining the
		approval of the Company's stockholders.
	 

	 
		
	 

	 
		4.
	 

	 
		Eligibility.
	 

	 
		Awards may be granted to the Manager in the discretion of the Board.
		 In determining the type of any Award (including the number of shares to
		be covered by such Award), the Board shall take into account such factors as
		the Board shall deem relevant in connection with accomplishing the purposes of
		the Plan.
	 

	 
		
	 

	 
		5.
	 

	 
		Stock Subject to the Plan.
	 

	 
		The maximum number of shares of Stock reserved for the grant of Awards
		under the Plan shall be 1,325,636, subject to adjustment as provided herein.
		 If any shares subject to an Award are forfeited, cancelled, exchanged or
		surrendered to the Company or if an Award terminates or expires without a
		distribution of shares to the Manager, the
	 

	 
		
 

	 

	 
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		shares of Stock with respect to such Award shall, to the extent of any
		such forfeiture, cancellation, exchange, surrender, termination or expiration,
		again be available for Awards under the Plan.  For purposes of determining
		the number of shares of Stock that remain available for issuance under the
		Plan, (i) the number of shares of Stock that are tendered by the Manager or
		other Award holder or withheld by the Company to pay the exercise price of an
		Award or to satisfy the Manager’s or the Award holder’s tax
		withholding obligations in connection with the exercise or settlement of an
		Award and (ii) all of the shares of Stock covered by any stock-settled SAR
		Award to the extent exercised, will not be added back to the Plan.  Upon
		the exercise of any Award granted in tandem with any other Award, such related
		Award shall be cancelled to the extent of the number of shares of Stock as to
		which the Award is exercised and, notwithstanding the foregoing, such number of
		shares shall no longer be available for Awards under the Plan.
	 

	 
		In the event that the Board shall determine that any dividend or other
		distribution (whether in the form of cash, Stock, or other property),
		recapitalization, Stock split, reverse split, reorganization, merger,
		consolidation, spin-off, combination, repurchase, or share exchange, or other
		similar corporate transaction or event, affects the Stock such that an
		adjustment is appropriate in order to prevent dilution or enlargement of the
		rights of the Manager under the Plan, then the Board shall make equitable
		changes or adjustments to any or all of:  (i) the number and kind of
		shares of Stock or other property (including cash) that may thereafter be
		issued in connection with Awards; (ii) the number and kind of shares of Stock
		or other property (including cash) issued or issuable in respect of outstanding
		Awards; (iii) the exercise price, base price or purchase price relating to any
		Award; and (iv) the performance goals, if any, applicable to outstanding
		Awards.  In addition, the Board may determine that any such equitable
		adjustment may be accomplished by making a payment to the Award holder, in the
		form of cash or other property (including but not limited to shares of Stock).
	 

	 
		
	 

	 
		6.
	 

	 
		Terms of Awards.
	 

	 
		(a)
	 

	 
		General.  The term of each Award shall be for such period as
		may be determined by the Board.  Subject to the terms of the Plan and any
		applicable Award Agreement, payments to be made by the Company upon the grant,
		vesting, maturation or exercise of an Award may be made in such forms as the
		Board shall determine at the date of grant or thereafter, including, without
		limitation, cash, Stock or other property, and may be made in a single payment
		or transfer, in installments or on a deferred basis.  The Board may make
		rules relating to installment or deferred payments with respect to Awards,
		including the rate of interest to be credited with respect to such payments.
		 In addition to the foregoing, the Board may impose on any Award or the
		exercise thereof, at the date of grant or thereafter, such additional terms and
		conditions, not inconsistent with the provisions of the Plan, as the Board
		shall determine.
	 

	 
		(b)
	 

	 
		Terms of Specified Awards.  The Board is authorized to grant
		the Awards described in this Section 6(b), under such terms and conditions as
		deemed by the Board to be consistent with the purposes of the Plan.  Such
		Awards
	 

	 
		
 

	 

	 
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		may be granted with vesting, value and/or and payment contingent upon
		attainment of one or more performance goals.  Except as otherwise set
		forth herein or as may be determined by the Board, each Award granted under the
		Plan shall be evidenced by an Award Agreement containing such terms and
		conditions applicable to such Award as the Board shall determine at the date of
		grant or thereafter.  
	 

	 
		(i)
	 

	 
		Options.  The Board is authorized to grant Options to the
		Manager on the following terms and conditions:
	 

	 
		(A)
	 

	 
		Exercise Price.  The exercise price per share of Stock
		purchasable under an Option shall be determined by the Board, but in no event
		shall the per share exercise price of any Option be less than 100% of the Fair
		Market Value of a share of Stock on the date of grant of such Option.  The
		exercise price for Stock subject to an Option may be paid in cash or by an
		exchange of Stock previously owned by the Manager, through a "broker cashless
		exercise" procedure approved by the Board (to the extent permitted by law) or a
		combination of the above, in any case in an amount having a combined value
		equal to such exercise price; provided that the Board may require that any
		Stock exchanged by the Manager have been owned by the Manager for at least six
		months as of the date of exercise.  An Award Agreement may provide that
		the Manager may pay all or a portion of the aggregate exercise price by having
		shares of Stock with a Fair Market Value on the date of exercise equal to the
		aggregate exercise price withheld by the Company.
	 

	 
		(B)
	 

	 
		Term and Exercisability of Options.  The date on which the
		Board adopts a resolution expressly granting an Option shall be considered the
		day on which such Option is granted (unless a subsequent grant date is set
		forth in the resolution).  Options shall be exercisable over the exercise
		period (which shall not exceed ten years from the date of grant), at such times
		and upon such conditions as the Board may determine, as reflected in the Award
		Agreement; provided, that the Board shall have the authority to accelerate the
		exercisability of any outstanding Option at such time and under such
		circumstances as it, in its sole discretion, deems appropriate.  An Option
		may be exercised to the extent of any or all full shares of Stock as to which
	 

	 
		
 

	 

	 
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		the Option has become exercisable, by giving written notice of such
		exercise to the Board or its designated agent.
	 

	 
		(C)
	 

	 
		Termination of Services.  Subject to Section 7, an Option may
		not be exercised unless the Manager is then providing services to the Company
		pursuant to the Management Agreement; provided, that the Award Agreement may
		contain provisions extending the exercisability of Options, in the event of the
		termination of the Management Agreement, to a date not later than the
		expiration date of such Option.
	 

	 
		(D)
	 

	 
		Section 409A of the Code.  An Option may only be granted to
		the Manager if the shares of Stock underlying such Option would qualify as
		“service recipient stock” under Section 409A of the Code.
	 

	 
		(E)
	 

	 
		Non-Qualified Stock Options.  The Options granted under the
		Plan shall be deemed to be “Non-Qualified Stock Options” under the
		Code.
	 

	 
		(F)
	 

	 
		Other Provisions.  Options may be subject to such other
		conditions including, but not limited to, restrictions on transferability of
		the shares acquired upon exercise of such Options, as the Board may prescribe
		in its discretion or as may be required by applicable law.
	 

	 
		(ii)
	 

	 
		Stock Appreciation Rights.  The Board is authorized to grant
		SARs to the Manager on the following terms and conditions:
	 

	 
		(A)
	 

	 
		In General.  Unless the Board determines otherwise, an SAR
		granted in tandem with an Option may be granted at the time of grant of the
		related Option or at any time thereafter.  An SAR granted in tandem with
		an Option shall be exercisable only to the extent the underlying Option is
		exercisable.  Payment of an SAR may be made in cash, Stock, or property as
		specified in the Award or determined by the Board.
	 

	 
		(B)
	 

	 
		Right Conferred.  An SAR shall confer on the Manager a right
		to receive an amount with respect to each share subject thereto, upon exercise
		thereof, equal to the excess of (1) the Fair Market Value of
	 

	 
		
 

	 

	 
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		one share of Stock on the date of exercise over (2) the base price of the
		SAR (which in the case of an SAR granted in tandem with an Option shall be
		equal to the exercise price of the underlying Option, and which in the case of
		any other SAR shall be such price as the Board may determine, provided it is no
		less than 100% of the Fair Market Value of a share of Stock on the date of
		grant of such SAR).
	 

	 
		(C)
	 

	 
		Term and Exercisability of SARs.  The date on which the Board
		adopts a resolution expressly granting an SAR shall be considered the day on
		which such SAR is granted.  SARs shall be exercisable over the exercise
		period (which shall not exceed the lesser of ten years from the date of grant
		or, in the case of a tandem SAR, the expiration of its related Award), at such
		times and upon such conditions as the Board may determine, as reflected in the
		Award Agreement; provided, that the Board shall have the authority to
		accelerate the exercisability of any outstanding SAR at such time and under
		such circumstances as it, in its sole discretion, deems appropriate.  An
		SAR may be exercised to the extent of any or all full shares of Stock as to
		which the SAR (or, in the case of a tandem SAR, its related Award) has become
		exercisable, by giving written notice of such exercise to the Board or its
		designated agent.
	 

	 
		(D)
	 

	 
		Termination of Services.  Subject to Section 7, an SAR may
		not be exercised unless the Manager is then providing services to the Company
		pursuant to the Management Agreement; provided, that the Award Agreement may
		contain provisions extending the exercisability of Options, in the event of the
		termination of the Management Agreement, to a date not later than the
		expiration date of such SAR (or, in the case of a tandem SAR, its related
		Award).  
	 

	 
		(E)
	 

	 
		Section 409A of the Code.  An SAR may only be granted to the
		Manager if the shares of Stock underlying such SAR would qualify as
		“service recipient stock” under Section 409A of the Code.
	 

	 
		(F)
	 

	 
		Other Provisions.  SARs may be subject to such other
		conditions including, but not limited to,
	 

	 
		
 

	 

	 
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		restrictions on transferability of the shares acquired upon exercise of
		such SARs, as the Board may prescribe in its discretion or as may be required
		by applicable law.
	 

	 
		(iii)
	 

	 
		Restricted Stock.  The Board is authorized to grant
		Restricted Stock to the Manager on the following terms and conditions:
	 

	 
		(A)
	 

	 
		Issuance and Restrictions.  Restricted Stock shall be subject
		to such restrictions on transferability and other restrictions, if any, as the
		Board may impose at the date of grant or thereafter, which restrictions may
		lapse separately or in combination at such times, under such circumstances, in
		such installments, or otherwise, as the Board may determine.  The Board
		may place restrictions on Restricted Stock that shall lapse, in whole or in
		part, only upon the attainment of one or more performance goals.  Unless
		otherwise determined by the Board, a Participant granted Restricted Stock shall
		have the right to vote Restricted Stock.
	 

	 
		(B)
	 

	 
		Forfeiture.  Subject to Section 7, upon termination of the
		Management Agreement during the applicable restriction period, Restricted Stock
		and any accrued but unpaid dividends that are then subject to restrictions
		shall be forfeited; provided, that the Board may waive in whole or in part the
		forfeiture of Restricted Stock.
	 

	 
		(C)
	 

	 
		Certificates for Stock.  Restricted Stock granted under the
		Plan may be evidenced in such manner as the Board shall determine.  If
		certificates representing Restricted Stock are registered in the name of the
		Manager, such certificates shall bear an appropriate legend referring to the
		terms, conditions and restrictions applicable to such Restricted Stock, and the
		Company shall retain physical possession of the certificate.
	 

	 
		(D)
	 

	 
		Dividends.   Participants holding Restricted Stock shall
		be entitled to receive all dividends and other distributions paid with respect
		to such Restricted Stock while unvested unless otherwise provided in the Award
		Agreement.  If any such dividends or distributions are paid in shares of
		Stock (including stock splits or stock dividends), such shares shall be
	 

	 
		
 

	 

	 
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		subject to the same restrictions (and shall therefore be forfeitable to
		the same extent) as the shares of Restricted Stock with respect to which they
		were paid, unless otherwise determined by the Board.  If any such
		dividends or distributions are paid in cash, the Award Agreement may specify
		that the cash payments shall be subject to the same restrictions as the related
		Restricted Stock, in which case they shall be accumulated during the vesting
		period and paid or forfeited when the related shares of Restricted Stock vest
		or are forfeited.  Alternatively, the Award Agreement may specify that the
		dividend equivalents or other payments shall be unrestricted, in which case
		they shall be paid as soon as practicable after the dividend or distribution
		date.  In no event shall any cash dividend or distribution be paid later
		than 21⁄2 months after the calendar year in which the dividend or
		distribution becomes nonforfeitable.  
	 

	 
		(iv)
	 

	 
		Restricted Stock Units.  The Board is authorized to grant
		RSUs to the Manager, subject to the following terms and conditions:
	 

	 
		(A)
	 

	 
		Award and Restrictions.  Delivery of Stock, cash or other
		property, as determined by the Board, will occur upon expiration of the period
		specified for RSUs by the Board during which forfeiture conditions apply, or
		such later date as the Board shall determine.  The Board may place
		restrictions on RSUs that shall lapse, in whole or in part, only upon the
		attainment of one or more performance goals.
	 

	 
		(B)
	 

	 
		Forfeiture.  Subject to Section 7, upon termination of the
		Management Agreement prior to the vesting of RSUs, or upon failure to satisfy
		any other conditions precedent to the delivery of Stock or cash to which such
		RSUs relate, all RSUs and any accrued but unpaid dividend equivalents that are
		then subject to deferral or restriction shall be forfeited; provided, that the
		Board may waive in whole or in part the forfeiture of RSUs.
	 

	 
		(C)
	 

	 
		Dividend Equivalents.  Unless otherwise determined by the
		Board, RSUs shall be credited with dividend equivalents at such time as
		dividends, whether in the form of cash, Stock or other property,
	 

	 
		
 

	 

	 
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		are paid with respect to the Stock.  Unless otherwise determined by
		the Board, any such dividend equivalents shall be paid on the dividend payment
		date to the Manager or other Award holder as though each RSU held by such
		holder were a share of outstanding Stock.
	 

	 
		(v)
	 

	 
		Other Stock-Based Awards.  The Board is authorized to grant
		Awards to the Manager in the form of Other Stock-Based Awards, as deemed by the
		Board to be consistent with the purposes of the Plan.  Awards granted
		pursuant to this paragraph may be granted with vesting, value and/or payment
		contingent upon the attainment of one or more performance goals.  The
		Board shall determine the terms and conditions of such Awards at the date of
		grant or thereafter.  Without limiting the generality of this paragraph,
		Other Stock-Based Awards may include grants of shares of Stock that are not
		subject to any restrictions or a substantial risk of forfeiture.
	 

	 
		
	 

	 
		7.
	 

	 
		Termination of Management Agreement.
	 

	 
		Unless otherwise determined by the Board and set forth in an individual
		Award Agreement, upon termination or non-renewal of the Management Agreement
		other than for Cause (as defined in the Management Agreement), any Award
		outstanding under the Plan that was not previously vested and/or exercisable
		shall become fully vested and/or exercisable, and any performance conditions
		imposed with respect to such Award shall be deemed to be fully achieved.
	 

	 
		
	 

	 
		8.
	 

	 
		Change in Control.
	 

	 
		(a)
	 

	 
		The Board shall have full authority to determine the effect, if any, of a
		Change in Control of the Company on the vesting, exercisability, settlement,
		payment or lapse of restrictions applicable to an Award, which effect may be
		specified in the applicable Award Agreement or determined at a subsequent time.
		 Subject to applicable laws, rules and regulations, the Board shall, at
		any time prior to, coincident with or after the effective time of a Change in
		Control, take such actions as it may consider appropriate, including, without
		limitation:  (A) providing for the acceleration of any vesting conditions
		relating to the exercise or settlement of an Award or that an Award shall
		terminate or expire unless exercised or settled in full on or before a date
		fixed by the Committee; (B) making such adjustments to the Awards then
		outstanding as the Committee deems appropriate to reflect such Change in
		Control; (C) causing the Awards then outstanding to be assumed, or new rights
		substituted therefor, by the surviving corporation in such Change in Control;
		or (D) permit or require the Manager or other Award holders to surrender
		outstanding Options and Stock Appreciation Rights in exchange for a cash
		payment equal to the difference between the highest price paid for a share of
		Stock in the
	 

	 
		
 

	 

	 
		11
	 

	 
		

	 

	 
 
	 
		

	 

	 
		

	 

	 
		Change in Control transaction and the exercise price of the Award. In
		addition, except as otherwise specified in an Award Agreement:  
	 

	 
		(i)
	 

	 
		any and all Options and Stock Appreciation Rights outstanding as of the
		effective date of the Change in Control shall become immediately exercisable,
		and shall remain exercisable until the earlier of the expiration of their
		initial term or the second (2nd) anniversary of the termination of the
		Management Agreement;
	 

	 
		(ii)
	 

	 
		any restrictions imposed on Restricted Stock and Restricted Stock Units
		outstanding as of the effective date of the Change in Control shall lapse;
	 

	 
		(iii)
	 

	 
		the vesting of all Awards denominated in shares of Stock outstanding as
		of the effective date of the Change in Control shall be accelerated.
	 

	 
		(b)
	 

	 
		Notwithstanding any other provision of the Plan or any Award Agreement,
		the provisions of this Section 8 may not be terminated, amended, or modified
		upon or after a Change in Control in a manner that would adversely affect an
		Award holder’s rights with respect to an outstanding Award without the
		prior written consent of the Award holder.
	 

	 
		
	 

	 
		9.
	 

	 
		General Provisions.
	 

	 
		(a)
	 

	 
		Nontransferability.  Unless otherwise provided in an Award
		Agreement, Awards with respect to which vesting and/or exercisability
		requirements have not been met shall not be transferable by the Manager.
		 Options and SARs granted under the Plan shall be exercisable only by the
		Manager.
	 

	 
		(b)
	 

	 
		No Right to Continued Service, etc.  Nothing in the Plan or
		in any Award, any Award Agreement or other agreement entered into pursuant
		hereto shall confer upon the Manager the right to provide services to the
		Company or any parent or subsidiary of the Company or to be entitled to any
		remuneration or benefits not set forth in the Plan or such Award Agreement or
		other agreement or to interfere with or limit in any way the right of the
		Company to terminate the Management Agreement.
	 

	 
		(c)
	 

	 
		Taxes.  The Manager shall be solely responsible for the
		payment of any taxes that may become payable by the Manager which arise from
		the issuance, vesting or exercise of any Award granted to it by the Company
		under the Plan.
	 

	 
		(d)
	 

	 
		Effective Date; Amendment and Termination.  
	 

	 
		
 

	 

	 
		12
	 

	 
		

	 

	 
 
	 
		

	 

	 
		

	 

	 
		(i)
	 

	 
		The Plan shall take effect upon the Effective Date, subject to the
		approval of the Company's stockholder(s).  
	 

	 
		(ii)
	 

	 
		The Board may at any time and from time to time terminate, amend, modify
		or suspend the Plan in whole or in part; provided, however, that unless
		otherwise determined by the Board, an amendment that requires stockholder
		approval in order for the Plan to comply with any law, regulation or stock
		exchange requirement shall not be effective unless approved by the requisite
		vote of stockholders.  The Board may at any time and from time to time
		amend any outstanding Award in whole or in part.  Notwithstanding the
		foregoing sentence of this clause (ii), no amendment or modification to or
		suspension or termination of the Plan or amendment of any Award (other than an
		amendment made for the Plan or an Award to comply with Section 409A of the
		Code) shall affect adversely any of the rights of the Manager, without the
		Manager's consent, under any Award theretofore granted under the Plan.
	 

	 
		(e)
	 

	 
		Expiration of Plan.  Unless earlier terminated by the Board
		pursuant to the provisions of the Plan, the Plan shall expire on the tenth
		anniversary of the Effective Date.  No Awards shall be granted under the
		Plan after such expiration date.  The expiration of the Plan shall not
		affect adversely any of the rights of the Manager, without the Manager's
		consent, under any Award theretofore granted.
	 

	 
		(f)
	 

	 
		No Rights to Awards.  The Manager shall not have any claim to
		be granted any Award under the Plan.  
	 

	 
		(g)
	 

	 
		Unfunded Status of Awards.  The Plan is intended to
		constitute an "unfunded" plan for incentive and deferred compensation.
		 With respect to any payments not yet made to the Manager pursuant to an
		Award, nothing contained in the Plan or any Award shall give any the Manager
		any rights that are greater than those of a general creditor of the Company.
	 

	 
		(h)
	 

	 
		No Fractional Shares.  No fractional shares of Stock shall be
		issued or delivered pursuant to the Plan or any Award.  The Board shall
		determine whether cash, other Awards or other property shall be issued or paid
		in lieu of such fractional shares or whether such fractional shares or any
		rights thereto shall be forfeited or otherwise eliminated.
	 

	 
		
 

	 

	 
		13
	 

	 
		

	 

	 
 
	 
		

	 

	 
		

	 

	 
		(i)
	 

	 
		Regulations and Other Approvals.
	 

	 
		(i)
	 

	 
		The obligation of the Company to sell or deliver Stock with respect to
		any Award granted under the Plan shall be subject to all applicable laws, rules
		and regulations, including all applicable federal and state securities laws,
		and the obtaining of all such approvals by governmental agencies as may be
		deemed necessary or appropriate by the Board.
	 

	 
		(ii)
	 

	 
		Each Award is subject to the requirement that, if at any time the Board
		determines, in its absolute discretion, that the listing, registration or
		qualification of Stock issuable pursuant to the Plan is required by any
		securities exchange or under any state or federal law, or the consent or
		approval of any governmental regulatory body is necessary or desirable as a
		condition of, or in connection with, the grant of an Award or the issuance of
		Stock, no such Award shall be granted or payment made or Stock issued, in whole
		or in part, unless listing, registration, qualification, consent or approval
		has been effected or obtained free of any conditions not acceptable to the
		Board.
	 

	 
		(iii)
	 

	 
		The Board may require the Manager receiving Stock pursuant to the Plan,
		as a condition precedent to receipt of such Stock, to enter into a stockholder
		agreement or "lock-up" agreement in such form as the Board shall determine is
		necessary or desirable to further the Company's interests.
	 

	 
		(j)
	 

	 
		Section 409A.  With respect to Awards subject to Section 409A
		of the Code, the Plan is intended to comply with the requirements of Section
		409A.  If any provision of the Plan or any term or condition of any Award
		would otherwise frustrate or conflict with this intent, the provision, term, or
		condition will be amended by the Board or Committee in its discretion to comply
		with Section 409A of the Code.
	 

	 
		(k)
	 

	 
		Governing Law.  The Plan and all determinations made and
		actions taken pursuant hereto shall be governed by the laws of Maryland without
		giving effect to the conflict of laws principles thereof.
	 

	 
		
 

	 

	 
		14Table of Contents

LEASE COMPLETION CHECKLIST

TEAMSTAFF INC.

1 Executive Drive, Suite 130, Somerset, NJ 08873

							
	TENANT:			THE FOLLOWING ITEMS MUST BE ATTACHED AND/OR COMPLETED

 AND RETURNED TO THE LANDLORD WITH THE SIGNED LEASE
	Sent			Rec’d			 
	 			 			Security in the amount of $8,000.00
	 			 			First Month’s Rent in the amount of $4,005.00
	 			 			Insurance Certificate (NB:    The Insurance Certificate should also be forwarded to our insurance compliance service by email to glenview_cert_tracking@ars.aon.com or by fax to 1-866-827-2256.) 

Two (2) signed originals of the Lease along with the above noted items should be forwarded to the Landlord’s management company: Denholtz Associates, Attn: Beata Batista, 1600 St. Georges Avenue, Rahway, New Jersey 07065.

Please direct any comments regarding the Lease prior to execution to: Clifford Frish, Esq., c/o Denholtz Associates, 1600 St. Georges Avenue, Rahway, New Jersey 07065, Tel: 732-956-3122, Fax: 732-388-1290, E-mail: cfrish@denholtznj.com.

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AGREEMENT OF LEASE

between

SOMERSET EXECUTIVE SQUARE ASSOCIATES, L.P.

and

TEAMSTAFF INC.

Complex:

1 Executive Drive

Somerset, NJ 08873

Table of Contents

TABLE OF CONTENTS

				
	BASIC PROVISIONS			 
	DEFINITIONS			 
	ARTICLE 1			DEMISE OF PREMISES AND COMMENCEMENT DATE
	ARTICLE 2			COMMON AREAS
	ARTICLE 3			RENT
	ARTICLE 4			SECURITY
	ARTICLE 5			ASSIGNMENT AND SUBLETTING
	ARTICLE 6			REPAIRS, MAINTENANCE AND UTILITES
	ARTICLE 7			COMPLIANCE WITH LAW
	ARTICLE 8			ALTERATIONS
	ARTICLE 9			INSURANCE
	ARTICLE 10			DAMAGE AND DESTRUCTION; EMINENT DOMAIN
	ARTICLE 11			RENT ABATEMENT
	ARTICLE 12			QUIET POSSESSION
	ARTICLE 13			DEFAULT; REMEDIES AND DAMAGES
	ARTICLE 14			UNAVOIDABLE DELAYS, FORCE MAJEURE
	ARTICLE 15			NOTICES
	ARTICLE 16			ACCESS
	ARTICLE 17			SIGNS
	ARTICLE 18			END OF TERM
	ARTICLE 19			HOLDING OVER
	ARTICLE 20			INDEMNITY
	ARTICLE 21			SUBORDINATION
	ARTICLE 22			CERTIFICATES
	ARTICLE 23			PARKING SPACES; USE OF EXTERIOR AREAS
	ARTICLE 24			WAIVER PROVISIONS
	ARTICLE 25			MISCELLANEOUS

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THIS LEASE is made and entered into as of this         day of        , 200        , by and between SOMERSET EXECUTIVE SQUARE ASSOCIATES, L.P., a New Jersey limited partnership, having its principal office at c/o Denholtz Management Corp., 1600 St. Georges Avenue, Rahway, New Jersey 07065 (‘‘Landlord’’) and TEAMSTAFF INC., a New Jersey corporation, having an address at 300 Atrium Drive, Somerset, NJ 08873 (‘‘Tenant’’).

NOW, THEREFORE, in consideration of the terms, covenants and conditions herein set forth, Landlord and Tenant hereby covenant and agree as follows:

The following Basic Provisions and Definitions are incorporated into and made a part of this Lease:

BASIC PROVISIONS

																			
	(1)			Building:			1 Executive Drive, Somerset, NJ 08873
	(2)			Premises:			Suite No. 130, consisting of approximately 2,670 Square Feet.
	(3)			Permitted Use:			Office
	(4)			Estimated Commencement Date:			June 1, 2007.
	(5)			Rent Commencement

Date:			The date which is sixty (60) calendar days after the Commencement Date.
	(6)			Expiration Date:			The last day of the sixtieth (60th) Lease Month.
	(7)			Security:			$8,000.00
	(8)			Base Rent:			Period			Annual Base Rent			Monthly Base Rent
	 			 			Commencement Date through

Rent Commencement Date				$	0.00					$	0.00	
	 			 			Lease Months 1 through 12				$	48,060.00					$	4,005.00	
	 			 			Lease Months 13 through 24				$	49,501.80					$	4,125.15	
	 			 			Lease Months 25 through 36				$	50,986.80					$	4,248.90	
	 			 			Lease Months 37 through 48				$	52,516.44					$	4,376.37	
	 			 			Lease Months 49 through 60				$	54,091.92					$	4,507.66	
	(9)			Base Year:			Calendar year 2007
	(10)			Tenant’s Percentage:			Initially 3.26%, subject to adjustment per terms of the Lease.
	(11)			Electricity Payment			Initially $389.38 per month, subject to adjustment per terms of the Lease.
	(12)			Tenant’s Address:			TeamStaff Inc.

1 Executive Drive

Suite No. 130

Somerset, NJ 08873
	(13)			Landlord’s Address:			c/o Denholtz Management Corp.

P.O. Box 1234

1600 St. Georges Avenue

Rahway, New Jersey 07065
	(14)			Parking Spaces:			Ten (10) spaces, subject to Article 23
	(15)			Broker:			Denholtz Associates and Equis Corporation
	(16)			Exhibits:			The following exhibits annexed hereto are hereby incorporated herein and made a part hereof:
	 			 			Exhibit A – Site Plan
	 			 			Exhibit B – Floor Plan
	 			 			Exhibit C – Rules & Regulations
	 			 			Exhibit D – Landlord’s Work
	 			 			Exhibit E – Renewal Option

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DEFINITIONS

(1)    ‘‘Additional Rent’’ means any and all sums payable by Tenant to Landlord pursuant to this Lease for any reason with the exception of Base Rent.

(2)    ‘‘Alteration(s)’’ means any and all installations, changes, additions or improvements to the Premises made by or at the request of Tenant, other than the Landlord’s Work.

(3)    ‘‘Base Operating Expenses’’ means the Operating Expenses incurred by Landlord in the Base Year.

(4)    ‘‘Base Taxes’’ means the Taxes incurred by Landlord in the Base Year.

(5)    ‘‘Building’’ means the building designated in the Basic Provisions section of this Lease.

(6)    ‘‘Complex’’ means the Building, the Common Areas and any other improvements on that certain developed parcel of real property located on 1 Executive Drive, Somerset, NJ 08873 as shown on Exhibit A.

(7)    ‘‘Commencement Date’’ means the earlier to occur of (i) the day on which possession of the Premises is delivered to Tenant ready for occupancy, or (ii) the day Tenant or anyone claiming under or through Tenant first occupies the Premises.

(8)    ‘‘Common Areas’’ means those portions of the Complex and services which are generally available to any and all of the owners, tenants or users of the Complex and the business invitees of such owners, tenants or users.

(9)    ‘‘Fee Mortgagee’’ means any person or entity which Landlord notifies Tenant has a mortgage against the Complex or Building.

(10)    ‘‘Governmental Authorities’’ means all federal, state, county and municipal governments and appropriate departments, commissions, boards, subdivisions, and officers thereof, the Board of Fire Underwriters or similar body having jurisdiction, foreseen or unforeseen, ordinary as well as extraordinary, and whether or not the same shall presently be within the contemplation of the parties hereto.

(11)    ‘‘Hazardous Materials’’ means any substances, materials, wastes, pollutants and the like which are defined as hazardous or toxic in, and/or regulated by (or become defined in and/or regulated by), any Legal Requirements.

(12)    ‘‘HVAC System’’ means the heating, air conditioning and ventilation systems, and all component parts of such systems, installed by Landlord for the purpose of supplying ventilation, heat and/or cooling to the Premises.

(13)    ‘‘Interest Rate’’ means the Prime Rate (hereinafter defined) plus five percent (5%). Where applicable, interest shall be payable for the time period provided in this Lease, and, if no time period is designated, the period shall be from the date of the occurrence in question to the date of payment. If, however, payment of interest at such rate by Tenant (or by the tenant then in possession having succeeded to Tenant’s interest in accordance with the terms of this Lease) should be unlawful, i.e., violative of usury statutes or otherwise, then ‘‘Interest Rate’’ shall be computed at the maximum lawful rate payable by such party.

(14)    ‘‘Landlord’s Work’’ – See Exhibit D

(15)    ‘‘Lease’’ means this lease as same may be amended, modified, extended or renewed.

(16)    ‘‘Lease Month’’ means each calendar month commencing (i) on the Rent Commencement Date if the Rent Commencement Date falls on the first day of a calendar month, or (ii) if the Rent Commencement Date is not the first day of a calendar month, on the first day of the month following the Rent Commencement Date with the first Lease Month to include the initial partial calendar month in which the Rent Commencement Date falls.

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(17)    ‘‘Legal Requirements’’ means any and all applicable laws and ordinances and the orders, rules, regulations and requirements of all Governmental Authorities whether or not the same shall presently be in force or within the contemplation of the parties hereto or shall involve any change of governmental policy, which may be applicable to the Lease, the Rent or the Premises or the use or manner of use of the Premises.

(18)    ‘‘Operating Expense(s)’’ means any and all amounts incurred by Landlord in any calendar year in connection with Landlord’s responsibilities under this Lease and/or to operate, manage, maintain and repair the Complex, including, without limitation, (i) wages, salaries and worker’s compensation (including employee benefits and unemployment and social security taxes and insurance) of staff performing services in connection with the Complex, and (ii) management fees (not to exceed five percent (5%) of gross collected rents), but excluding any capitalized expenses.

(19)    ‘‘Personalty’’ means any and all personal property of any type belonging to Tenant and located in or about the Building, the Premises and/or the Complex.

(20)    ‘‘Premises’’ means the portion of the Building designated in the Basic Provisions section of this Lease, as shown on Exhibit B.

(21)    ‘‘Prime Rate’’ means the prime interest rate for short term (90 day) unsecured loans as published from time to time by the Wall Street Journal, Eastern Edition.

(22)    ‘‘Repair(s)’’ means any and all maintenance, repairs, replacements, alterations, additions and betterments, foreseen or unforeseen, ordinary or extraordinary, required to maintain the Premises and/or the Complex to the standard to which similar properties are maintained in the community in which the Complex is located.

(23)    ‘‘Rent’’ means any and all Base Rent and/or Additional Rent.

(24)    ‘‘Rules and Regulations’’ – means the Rules and Regulations set out in Exhibit C, subject to the provisions of Section 25.1.

(25)    ‘‘Security’’ means the amount specified in the Basic Provisions, subject to the provisions of Article 4.

(26)    ‘‘Square Feet’’ refers to the total number of square feet of floor area of all floors in the Building, including any mezzanine or basement space, as measured from the exterior faces of the exterior walls and/or the center line of any common walls. The Square Feet of the Premises shall conclusively be the number of Square Feet indicated in the Basic Provisions, which number includes a factor which takes into account the Common Areas.

(27)    ‘‘Taking’’ means a legal transfer of ownership and/or possession, whether temporary or permanent, for any public or quasi-public use by any lawful power or authority by exercise of the right of condemnation or eminent domain or by agreement between Landlord and those having the authority to exercise such right.

(28)    ‘‘Taxes’’ means any and all ad valorem real estate taxes and general, special and betterment assessments, incurred by Landlord as owner of the Complex in any calendar year, including, without limitation, all water and sewer charges, and any taxes, fees and charges imposed in lieu of or in addition to the foregoing due to a future change in the method of taxation. Nothing contained in this Lease shall require Tenant to pay any estate, inheritance, succession, corporate franchise or income tax of Landlord, nor shall any of same be deemed Taxes, except to the extent same are substituted in lieu of other forms of Taxes. Any Taxes for a calendar tax year only a part of which is included within the Term, shall be adjusted between Landlord and Tenant on the basis of a 365-day year as of the Commencement Date or the Expiration Date or sooner termination of the Term, as the case may be, for the purpose of computing Tenant’s Tax Payment.

(29)    ‘‘Tenant’s Percentage’’ means the number of Square Feet within the Premises divided by the number of Square Feet within the Building. Landlord shall proportionally increase or decrease Tenant’s Percentage if the number of Square Feet in the Building increases or decreases due to additional development, subdivision, demolition, condemnation, or similar reasons.

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(30)    ‘‘Term’’ means the period beginning on the Commencement Date and ending on the Expiration Date, unless sooner terminated or extended as provided elsewhere in this Lease.

(31)    ‘‘Vesting Date’’ means the date of vesting of title or transfer of possession, whichever is earlier, if the Complex, Building, Premises or any portion thereof is the subject of a Taking.

(32)    ‘‘Year End Reconciliation’’ – See Section 3.2.

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ARTICLE 1    DEMISE OF PREMISES AND COMMENCEMENT DATE

Section 1.1    Demise.    Landlord is the owner of the Complex and hereby leases the Premises to Tenant for the Term. Tenant hereby takes the Premises from Landlord, subject to all liens, encumbrances, easements, restrictions, covenants, zoning laws and regulations affecting and governing the Premises. Tenant shall use the Premises for the Permitted Use and for no other use or purpose.

Section 1.2    Delivery and Acceptance.

(a)    Upon completion of the Landlord’s Work, Landlord shall deliver, and Tenant shall accept delivery of, possession of the Premises. The Premises shall be delivered in ‘‘broom clean’’, but otherwise in ‘‘AS IS, WHERE IS’’ condition. If the Premises are not ready for Tenant’s occupancy at the time of the Estimated Commencement Date, Landlord shall have no liability to Tenant for any delay and this Lease shall not be affected thereby, except that the Commencement Date shall be the actual date of delivery of possession of the Premises to Tenant.

(b)    Upon entering into possession of the Premises, Tenant shall conclusively be deemed to have accepted the Premises in its then ‘‘AS IS, WHERE IS’’ condition, including, without limitation, as regards the title thereto, the nature, condition and usability thereof, and the use or uses to which the Premises may be put, and shall be deemed to have assumed all risk, if any, resulting from any patent defects and from the failure of the Premises to comply with all Legal Requirements applicable thereto. Except as specifically provided herein, Landlord shall not be required to perform any work to prepare the Premises for Tenant’s intended use.

Section 1.3    Commencement Date Letter.    After determination of the Commencement Date, Landlord may send Tenant a commencement letter confirming the Commencement Date, the Expiration Date and any other variable terms of the Lease. The commencement letter, which may be delivered by regular mail, shall become a part of this Lease and shall be binding on Tenant and Landlord if Tenant does not give Landlord notice of its disagreement with any of the provisions of such commencement letter within ten (10) days after the date of such letter.

ARTICLE 2    COMMON AREAS

Section 2.1    Use of Common Areas.    Beginning on the Commencement Date, Tenant shall have the nonexclusive right to the use of the Common Areas in common with others.

Section 2.2    Complex and Building.    Provided Landlord makes commercially reasonable efforts to avoid interfering with Tenant’s use and occupancy of the Premises, Landlord shall have the right (i) to add to, or subtract from, the Common Areas, the Complex and/or the Building as Landlord may elect and Tenant shall not be entitled to any compensation as a result thereof, nor shall same be deemed an actual or constructive eviction, (ii) to erect, use and maintain pipes, ducts, shafts and conduits in and through the Premises, and (iii) to temporarily close any part of the Common Areas for such time as may be required to prevent a dedication thereof or an accrual of any rights in any person or in the public generally therein, or when necessary for the maintenance or repair thereof, or for such other reason as Landlord in its judgment may deem necessary or advisable.

ARTICLE 3    RENT

Section 3.1    Rent.

(a)    From and after the Commencement Date and throughout the Term, Tenant shall pay Rent to Landlord. All payments of Rent shall be paid to or on behalf of Landlord in lawful money of the United States, without prior demand or notice. All payments of Rent shall be delivered to Landlord at the address set forth in this Lease or to any other place designated by Landlord. Tenant’s obligation to pay Rent accruing or on account of any time period during the Term shall survive the Expiration Date. This Lease shall not be affected by any Legal Requirements which may be enacted or become effective from and after the date of this Lease affecting or regulating or attempting to affect or regulate the Rent set out herein.

(b)    The first full monthly installment of Base Rent shall be paid to Landlord simultaneous with execution of this Lease by Tenant. Thereafter, Base Rent shall be paid in equal monthly 

8

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installments in advance on or before the first day of each month during the Term. Base Rent for the first Lease Month shall be increased, if appropriate, on a pro-rata basis for the actual number of calendar days occurring in the first Lease Month.

(c)    Except as otherwise expressly and specifically provided to the contrary in this Lease, no abatement, diminution or reduction of Rent shall be claimed by or allowed to Tenant, or any persons or entities claiming under Tenant, under any circumstances for any cause or reason.

Section 3.2    Tenant’s Tax Payment and Operating Expense Payment

(a)    Tenant shall pay to Landlord, as Additional Rent: (i) a portion of all Taxes in excess of the Base Taxes (‘‘Tax Payment’’), and (ii) a portion of all Operating Expenses in excess of the Base Operating Expenses (‘‘Operating Expense Payment’’). Tenant’s Tax Payment shall be equal to the product of (the Taxes allocated to the Building less the Base Taxes) multiplied by Tenant’s Percentage. Tenant’s Operating Expense Payment shall be equal to the product of (the Operating Expenses allocated to the Building less the Base Operating Expenses) multiplied by Tenant’s Percentage.

(b)    In each calendar year after the Base Year, Landlord, at its option, shall have the right to require Tenant to pay, on a monthly basis as Additional Rent, an ‘‘Estimated Tax Payment’’ and an ‘‘Estimated Operating Expense Payment’’. The Estimated Tax Payment shall be equal to the product of Landlord’s reasonable estimate of the actual Taxes for the current year minus the Base Taxes multiplied by Tenant’s Percentage and divided by the number of months remaining in the year. The Estimated Operating Expense Payment shall be equal to the product of Landlord’s reasonable estimate of the actual Operating Expenses for the current year minus the Base Operating Expenses multiplied by Tenant’s Percentage and divided by twelve (12).

(c)    After the end of each calendar year after the Base Year, Landlord shall furnish to Tenant a statement of the difference, if any, between (i) the Tax Payment due and the actual amount of Estimated Tax Payments made by Tenant for the preceding calendar year and (ii) the Operating Expense Payment due and the actual amount of Estimated Operating Expense Payments made by Tenant for the preceding calendar year (a ‘‘Year End Reconciliation’’). Tenant shall, within twenty (20) days after Landlord’s receipt of a Year End Reconciliation, pay to Landlord the net deficiency, if any, set out in the Year End Reconciliation. If the Year End Reconciliation shows an overpayment of Estimated Tax and/or Estimated Operating Expense Payments, such overpayment shall be credited to Tenant against the next monthly installment or installments of Estimated Tax or Estimated Operating Expense Payment(s), as the case may be, due from Tenant, or shall be refunded to Tenant if such excess relates to the calendar year in which the Term expires.

(d)    Every Year End Reconciliation shall be conclusive and binding upon Tenant unless (i) within twenty (20) days after the receipt of a Year End Reconciliation, Tenant shall notify Landlord that it disputes the correctness of the Year End Reconciliation, specifying the particular respects in which the Year End Reconciliation is claimed to be incorrect, and (ii) if such dispute shall not have been settled by agreement, Tenant shall submit the dispute to arbitration pursuant to this Lease within twenty (20) days after Landlord’s receipt of Tenant’s notice of dispute. Pending the determination of such dispute by agreement or arbitration, Tenant shall pay Rent or accept credit in accordance with the Year End Reconciliation and such payment or acceptance shall be without prejudice to Tenant’s position.

(e)    Landlord may elect to contest the amount or validity of assessed valuation or Taxes for any real estate fiscal tax year, in which event Taxes shall be deemed to include any fees and/or expenses incurred by Landlord in contesting or appealing Taxes and Tenant shall pay Tenant’s Percentage of the amount thereof within twenty (20) days after receipt of demand therefor. If Landlord shall receive a refund of any portion of the Taxes after Tenant’s Tax Payment has been paid, then Landlord shall, after deducting all unreimbursed expenses paid by Landlord, if any, incurred in obtaining such refund, apply Tenant’s Percentage of such net refund against the next installment or installments of Tenant’s Tax Payment, or shall refund such amount to Tenant if 

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such refund relates to the calendar year in which the Term expires. Tenant shall cooperate with Landlord, execute any and all documents required in connection therewith and, if required by Legal Requirements, shall join with Landlord in the prosecution thereof.

(f)    In addition to Tenant’s Tax Payment, Tenant shall pay, before delinquent, any and all taxes and assessments (i) levied against fixtures, equipment, signs and personal property located or installed in, about or upon the Premises; (ii) on account of any rent, income or other payments received by Tenant or anyone claiming by, through or under Tenant; (iii) arising out of the use or occupancy of the Premises and this transaction, or any document to which Tenant is a party creating or transferring an interest or estate in the Premises, and (iv) imposed by any Governmental Authority as a sales or use tax.

(g)    If Tenant disputes or disagrees with any Year End Reconciliation, Tenant shall have the right to undertake a review (‘‘Review’’) of Landlord’s books used to determine Tenant’s Tax Payment and Operating Expense Payment upon the following terms and conditions:

(i)    Tenant shall deliver notice (‘‘Review Notice’’) to Landlord, in writing, of such dispute or disagreement no later than thirty (30) days after receipt of the Year End Reconciliation to be verified.

(ii)    The Review shall be conducted only by (i) the Tenant, or (ii) an agent of the Tenant that is not being compensated by Tenant on a contingent fee basis. The Review shall be conducted during regular business hours at the office where Landlord maintains its books.

(iii)    The Review shall commence no later than thirty (30) days after the date of delivery of the Review Notice and shall be completed within five (5) business days after commencement.

(iv)    A copy of the results of the Review shall be delivered to Landlord within thirty (30) days after completion of the Review. If the results of the Review are not timely delivered to Landlord, then the Year End Reconciliation shall be deemed to have been approved and accepted by Tenant as correct.

(v)    The Review shall be limited strictly to those items in the Year End Reconciliation that Tenant has specifically identified in the Review Notice. Tenant shall not be entitled to inspect books or records that apply to any calendar year other than the year covered by the subject Year End Reconciliation.

(vi)    Tenant acknowledges and agrees that any records reviewed constitute confidential information of Landlord which shall not be disclosed to anyone other than the auditor performing the Review and the principals of Tenant. Tenant further acknowledges and agrees that the disclosure of information to any other person, whether by Tenant or anyone acting on behalf of Tenant, shall cause irreparable harm to Landlord and may be the basis of legal action by Landlord against Tenant and/or the auditor performing the Review. Tenant shall be responsible for any breach of this provision by the entity conducting the Review.

Section 3.3    Late Charge.    If any Rent is not paid to Landlord within five (5) days after its due date, a late charge equal to ten percent (10%) of the then late payment shall be automatically due from Tenant to Landlord ( ‘‘Late Charge’’). The Late Charge is in compensation of Landlord’s additional costs of processing late payments. Additionally, payments of Rent not received by Landlord when due shall accrue interest at the Interest Rate from the date on which such payment was due until the date full payment (including accrued interest) is received by Landlord.

ARTICLE 4    SECURITY

(a)    Tenant has, simultaneously with the execution hereof, deposited with Landlord the Security for the faithful performance and observance by Tenant of the terms, covenants, conditions and provisions of this Lease. Landlord may retain, use, or apply the whole or part of the Security to the extent required for payment of any: (i) Rent; (ii) loss or damage that Landlord may suffer by reason of an Event of Default by Tenant including, without limitation, any damages 

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incurred by Landlord or deficiency resulting from the re-letting of the Premises, whether such damages or deficiency accrues before or after summary proceedings or other reentry by Landlord; (iii) costs incurred by Landlord in connection with the cleaning or repair of the Premises upon expiration or earlier termination of this Lease. Landlord shall not be obligated to apply the Security and the Landlord’s right to bring an action or special proceeding to recover damages or otherwise to obtain possession of the Premises before or after Landlord’s declaration of the termination of this Lease for nonpayment of Rent or for any other reason shall not be affected by reason of the fact that Landlord holds the Security. The Security will not be a limitation on the Landlord’s damages or other rights and remedies available under this Lease, or at law or equity; nor shall the Security be a payment of liquidated damages or advance of the Rent or any component thereof.

(b)    If Landlord uses, applies, or retains all or any portion of the Security, Tenant will restore the Security to its original amount immediately upon written demand from Landlord. Tenant’s failure to strictly comply with this requirement shall be an Event of Default.

(c)    Subject to applicable Legal Requirements and requirements of Landlord’s lender(s), Landlord may commingle the Security with its own funds. Landlord shall not be required to keep the Security in an interest bearing account. Upon expiration or earlier termination of the Lease, Landlord will return the Security to the then current Tenant and Landlord shall be deemed released by Tenant from all liability for the return of the Security. If any part of Landlord’s property of which the Premises forms a part is sold, leased or otherwise legally transferred (including to a mortgagee upon foreclosure of its mortgage), Landlord shall transfer the Security to the successor entity, and, upon such transfer, Landlord shall be deemed released by Tenant from all liability for the return of the Security; and Tenant shall look solely to the Landlord’s successor for the return of the Security.

(d)    The Security shall not be mortgaged, assigned, or encumbered by Tenant, and neither Landlord nor its successors or assigns shall be bound by any such mortgage, assignment or encumbrance.

(e)    If no Event of Default remains uncured beyond any applicable cure or grace period, the amount of Security required hereunder shall be reduced to Fourth Thousand and 00/100 Dollars ($4,000.00) following the last day of the fourteenth (14th) lease month. Any excess Security in the possession of Landlord after such reduction shall be refunded to Tenant by way of credit(s) against the next occurring charge(s) for Base Rent.

(f)    If Tenant fully and faithfully complies with all of the terms, covenants, conditions and provisions of this Lease, Landlord shall, within sixty (60) days after the later of the Expiration Date and the date of surrender of possession of the Premises to Landlord in accordance with this Lease, return to Tenant the Security, or such portion thereof as shall then remain, less an estimated amount due for any unpaid Operating Expense Payment and/or Tax Payment.

ARTICLE 5    ASSIGNMENT AND SUBLETTING

Section 5.1    Permitted Transfers.

(a)    The provisions of Section 5.2 notwithstanding, Tenant shall be permitted to assign this Lease or sublet the Premises (a ‘‘Permitted Transfer’’) without further consent of Landlord, to a parent, subsidiary or affiliate of Tenant, provided that the financial strength of the proposed assignee or subtenant as of the effective date of the transfer shall be at least equal to the financial strength of Tenant as of the Commencement Date. For purposes of this section, the term ‘‘affiliate’’ shall mean a business entity that directly or indirectly controls, is controlled by, or is under common control with Tenant at the time of the intended transfer.

(b)    A Permitted Transfer shall not be deemed effective or binding on Landlord unless there is delivered to Landlord within five (5) days of the effective date of the Permitted Transfer, (i) an agreement, executed by Tenant and the assignee, by which the assignee agrees to be the Tenant as defined herein and assume all of the obligations of the Tenant, or (ii) a sublease.

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(c)    The right to transfer granted under this Section shall be personal to the Tenant originally executing this Lease. No successor to the original Tenant shall have the right to any Permitted Transfer and all successors to the original Tenant shall be required to obtain Landlord’s consent to any later assignment or subletting.

Section 5.2    Consent Required.

(a)    Except as otherwise set out in this Article, Tenant shall not mortgage, encumber or assign its interest in this Lease or sublet all or any part of the Premises without the prior written consent of Landlord, which consent shall not be unreasonably withheld, conditioned or delayed.

(b)    Landlord’s consent to any one assignment or sublease will not act as a waiver of the requirement of obtaining the Landlord’s consent to any subsequent assignment or sublease.

(c)    Should Tenant wish to assign this Lease or sublet any portion of the Premises, Tenant shall submit to Landlord a written request (‘‘Tenant’s Request’’) for Landlord’s consent to such assignment or subletting. Tenant’s Request shall include, at a minimum, the name and address of the proposed assignee or subtenant, the proposed use of the Premises, financial statements of the proposed assignee or sublessee in form satisfactory to Landlord, a copy of the proposed assignment or sub-lease, executed by Tenant and the assignee or sub-tenant, and any other documentation reasonably required by Landlord.

(d)    Notwithstanding anything contained in this Lease to the contrary, Landlord shall not be obligated to entertain or consider any request by Tenant to consent to any proposed assignment of this Lease or sublet of all or any part of the Premises unless each request by Tenant is accompanied by a nonrefundable fee payable to Landlord in the amount of Five Hundred and 00/100 Dollars ($500.00) to cover Landlord’s administrative, legal, and other costs and expenses incurred in processing each Tenant’s Request. Neither Tenant’s payment nor Landlord’s acceptance of the said fee shall be construed to impose any obligation whatsoever upon Landlord to consent to Tenant’s request. Landlord shall have the right to charge Tenant an additional or higher fee in the event the processing of the proposed assignment or subletting shall require more than two (2) hours to negotiate and/or draft the necessary documents.

(e)    Landlord and Tenant agree that any one of the following factors, or any other reasonable factor, will be reasonable grounds for declining the Tenant’s request:

(i)    financial strength of the proposed subtenant/assignee is not at least equal to that of the Tenant as of the Commencement Date and the proposed effective date of the assignment or subletting;

(ii)    business reputation of the proposed subtenant/assignee is not in accordance with generally acceptable commercial standards and the businesses of other tenants in the Complex;

(iii)    the proposed subtenant/assignee is an existing tenant or occupant of the Complex, or a person or entity with whom Landlord is then dealing with regard to leasing space in the Complex, or with whom Landlord has had any dealings within the past six months with regard to leasing space in the Complex;

(iv)    use of the Premises will violate the exclusive right(s) of any other tenant of the Complex, any other agreements affecting the Premises, the Landlord or other tenants.

(f)    Tenant shall pay to Landlord, as Additional Rent, fifty percent (50%) of any and all rents, additional charges, and other consideration payable to Tenant under or in connection with any sublease which is in excess of the Rent and Additional Rent accruing under the Lease during the term of the sublease.

Section 5.3    Change of Control.    Excluding the sale of corporate shares held by the general public and traded through a nationally recognized stock exchange, the sale, assignment, transfer or other disposition of any of the issued and outstanding capital stock of Tenant (or of any successor or assignee of Tenant which is a corporation), or of the interest of any general partner in a partnership 

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constituting Tenant hereunder, or of the interest of any member of a limited liability company, joint venture, syndicate or other group which may collectively constitute Tenant hereunder, shall result in changing the control of Tenant or such other corporation or such partnership, limited liability company, joint venture, syndicate or other group, such sale, assignment, transfer or other disposition shall be deemed an assignment of this Lease. For the purposes of this Section, ‘‘control’’ of any corporation shall be deemed to have changed, if, in one or more transactions, any person or group of persons purchases or otherwise succeeds to more than forty nine percent (49%) in the aggregate of the voting power for the election of the Board of Directors of such corporation and ‘‘control’’ of a partnership, a limited liability company, joint venture, syndicate or other group shall be deemed to have changed if, in one or more transactions, any person or group of persons purchases or otherwise succeeds to more than forty nine percent (49%) in the aggregate of the general partners’ or other active interest in such limited liability company, joint venture, syndicate or other group.

Section 5.4    Continuation of Liability.    Regardless of any assignment, subletting or other transfer by Tenant of any of Tenant’s rights or obligations under this Lease, Tenant shall continue to be and remain liable hereunder.

Section 5.5    Default after Transfer.    If this Lease is assigned, or if the Premises or any part thereof is sublet or occupied by anybody other than Tenant, Landlord may, after an Event of Default by Tenant, and without notice to Tenant collect rent from the assignee, subtenant or occupant, and apply the net amount collected to the Rent herein reserved, but no such assignment, subletting, occupancy or collection shall be deemed an acceptance of the assignee, subtenant or occupant as tenant, or a release of Tenant from the further performance by Tenant of the terms, covenants and conditions of this Lease on the part of Tenant to be performed. Any violation of any provision of this Lease, whether by act or omission, by any assignee, subtenant or similar occupant, shall be deemed a violation of such provision by Tenant, it being the intention and meaning of the parties hereto that Tenant shall assume and be liable to the Landlord for any and all acts and omissions of any and all assignees, subtenants and similar occupants.

Section 5.6    Recapture.    Landlord shall have the right, within forty five (45) days after Landlord’s receipt of Tenant’s Request, to terminate this Lease on notice (a ‘‘Recapture Notice’’) to Tenant. If Landlord gives a Recapture Notice, Tenant shall have five (5) calendar days from receipt of such Recapture Notice to rescind, in writing, the Tenant’s Request and, upon such rescission, both the Recapture Notice and Tenant’s Request shall be deemed withdrawn, null and void. If Tenant’s Request is not so rescinded within the permitted time period, then this Lease shall terminate (in whole if Tenant’s Request is for an assignment of the Lease or subleasing of all or substantially all of the Premises, or with respect to that part of the Premises which is the subject of a subletting if Tenant’s Request is for a subletting of less than substantially all of the Premises) (that portion, whether the whole or a part, of the Premises which is the subject of Tenant’s Request is hereinafter referred to as the ‘‘Subject Portion’’) on the date which is thirty (30) days after the date of the Recapture Notice (the ‘‘Surrender Date’’). Tenant shall vacate the Subject Portion on or before the Surrender Date and deliver possession of the Subject Portion to Landlord in the condition required by this Lease. Effective as of the Surrender Date, neither Landlord nor Tenant shall have any further obligations under this Lease with respect to the Subject Portion, except for those rights and obligations which survive expiration or termination of the Lease. Effective as of the Surrender Date, all Rent shall be adjusted on a pro rata basis to reflect the reduced size of the Premises.

ARTICLE 6    REPAIRS, MAINTENANCE AND UTILITIES

Section 6.1    Tenant’s Obligations.

(a)    If the Premises has a point of entry and exit on the exterior of the Building, Tenant shall keep the sidewalk adjoining the Premises free from rubbish, dirt, garbage and other refuse.

(b)    All damage or injury to the Premises or to its fixtures, appurtenances and equipment or to the Building, its fixtures, appurtenances or equipment caused by Tenant, its servants, employees, agents, visitors or licensees, shall be Repaired promptly by Tenant at no cost or expense to Landlord and to the reasonable satisfaction of Landlord. Tenant shall cause all 

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Repairs to be made in a good and workmanlike manner and in accordance with the provisions of this Lease. If Tenant fails after twenty (20) days’ notice to proceed with due diligence to make Repairs required to be made by Tenant, the same may be made by Landlord at the expense of Tenant, and the expenses thereof incurred by Landlord, with interest thereon at the Interest Rate, shall be paid to Landlord as Additional Rent within ten (10) calendar days after delivery of a bill or statement to Tenant.

Section 6.2    Landlord’s Obligations and Services.

(a)    Landlord agrees to make all Repairs to the structural portions and exterior surfaces of the Building, the roof, the roof gutters, and operate and Repair the Common Areas.

(b)    Landlord shall additionally provide the following services to Tenant:

(i)    Repair of the interior of the Premises within a reasonable period of time after submission of a request by Tenant, the cost of same being included in Operating Expense.

(ii)    Repair, at Tenant’s cost, of all light fixtures, including any ballasts, and light bulbs, such cost to be deemed Additional Rent.

(iii)    Janitorial services, general cleaning of the Premises, and removal and disposal of all trash and other refuse, the cost of same being deemed an Operating Expense. Landlord reserves the right to impose a surcharge on Tenant directly if excessive amounts or unusual types of trash are generated in the Premises.

(iv)    Air cooling and heat, between the hours of 8:00 A.M. and 6:00 P.M, Monday through Friday, and 8:00 A.M. through 1:00 P.M. on Saturdays. Tenant at all times agrees to cooperate fully with Landlord and to abide by all regulations and requirements which Landlord may reasonably prescribe for the proper functioning and protection of the HVAC System. Landlord shall have free access to any and all components of the HVAC System; and Tenant agrees that there shall be no construction of partitions or other obstructions which might interfere with Landlord’s full access thereto, or interfere with the moving of Landlord’s equipment to and from the enclosures containing said installations. Tenant agrees that Tenant, its agents, employees or contractors shall not at any time enter the said enclosures or tamper with, adjust, touch or otherwise in any manner affect the HVAC System.

(v)    Operation and Repair of the HVAC System in a manner consistent with the standard to which similar properties are maintained in the area, the cost of same being included in Operating Expenses. Landlord may, upon not less than thirty (30) days notice to Tenant, require Tenant to assume responsibility for operation and Repair of the HVAC System serving the Premises, at Tenant’s cost and expense, in which event Tenant shall promptly enter into a maintenance contract with a reputable heating and air conditioning contractor reasonably acceptable to Landlord and provide Landlord with a copy thereof.

(c)    Tenant acknowledges that Landlord shall not be providing the security which Tenant may require with respect to its Permitted Use(s). Landlord and Tenant hereby expressly acknowledge that Tenant shall be required to install such security systems as Tenant may require with respect to its Permitted Use(s) and that all costs and expenses with regard to such security to be provided by Tenant shall be at Tenant’s sole cost and expense.

(d)    Landlord reserves the right to undertake such Complex-wide Repairs and provide such Complex-wide services as it deems necessary to preserve and promote the good physical condition of the Building and such costs shall be deemed Operating Expenses.

Section 6.3    Utilities.

(a)    The following utilities will be made available at the Premises:

(i)    (A)    Electric current, with the understanding, however, that the cost of electricity consumed by Tenant in the Premises is not included in Base Rent or Operating Expenses. Therefore, Tenant shall additionally be required to pay an estimated and agreed amount for 

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the consumption of electricity (the ‘‘Electricity Payment’’) as set out in the Basic Provisions section of the Lease. The Electricity Payment shall be fixed for the entire Term, subject to Landlord’s right to survey the utility usage, as follows.

(B)    Landlord may, at any time and from time to time, at no cost or expense to Tenant, survey the estimated use of electricity in the Premises. The Electricity Payment shall be adjusted as appropriate based on the results of the survey.

(C)    Landlord shall provide a copy of any utility survey to Tenant and the results of such survey shall be deemed binding upon Tenant unless Tenant objects to same within thirty (30) days of the date the survey is delivered to Tenant. If Landlord and Tenant are unable to agree upon the results of a survey, the disagreement shall be submitted to arbitration in accordance with the terms of this Lease. Pending the outcome of such arbitration, the charges to Tenant imposed pursuant to this Section shall be paid by Tenant without prejudice to Tenant’s rights.

(ii)    water service, the cost of which shall be included in Operating Expenses.

(iii)    sewer service, the cost of which shall be included in Operating Expenses.

(b)    Tenant agrees to pay or cause to be paid all charges for utilities of any kind which are billed directly to Tenant, and agrees to indemnify, defend and save Landlord harmless against any liability or damages for such charges.

(c)    Tenant covenants and agrees that its use of utility services will not exceed either the capacity or maximum load of the utility lines serving the Premises or which may from time to time be prescribed by applicable Governmental Authorities.

(d)    Unless the direct and proximate result of the gross negligence or willful misconduct of Landlord, its agents, servants or employees, Landlord shall in no event be liable or responsible to Tenant for any loss, damage or expense which Tenant may sustain or incur if either the quantity or character of utility services is changed or is no longer available or suitable for Tenant’s purposes.

ARTICLE 7    COMPLIANCE WITH LAW

Section 7.1    Legal Requirements.    Tenant shall, at its expense throughout the Term, promptly comply, or cause compliance, with all Legal Requirements of all Governmental Authorities which may be applicable to the Premises or the use or manner of use thereof.

Section 7.2    Hazardous Materials.    Tenant agrees to refrain, and to prevent its employees, invitees, agents, contractors and subtenants, from bringing any Hazardous Materials onto the Premises, except for cleaning fluids and common office supplies in de minimis quantities for normal cleaning use within the Premises which shall be stored in proper containers and in compliance with Legal Requirements. Tenant hereby covenants and agrees to indemnify, defend and hold Landlord harmless from and against any and all claims, actions, administrative proceedings, judgments, damages, penalties, costs, expenses, losses and liabilities of any kind or nature that arise (indirectly or directly) from or in connection with the presence (or suspected presence), release (or suspected release), spill (or suspected spill) or discharge (or suspected discharge) of any Hazardous Materials in, on or about the Premises at any time resulting from the acts or omissions of Tenant, its subtenants or their respective employees, agents or contractors. Without limiting the generality of the foregoing, the indemnity set forth above shall specifically cover any investigation, monitoring and remediation costs.

Section 7.3    ISRA.    Tenant further covenants and agrees that Tenant is not, and the Premises shall not be occupied during the Lease by, an ‘‘Industrial Establishment,’’ as defined in the Industrial Site Recovery Act, N.J.S.A. 13:1k-6 et seq., and the rules and regulations promulgated thereunder, as same may be amended from time to time (‘‘ISRA’’). If Tenant’s operations on the Premises now or hereafter constitute an Industrial Establishment subject to the requirements of ISRA, then prior to the expiration or sooner termination of this Lease, Tenant, at no cost or expense to Landlord, shall comply with all requirements of ISRA pertaining to an Industrial Establishment closing or transferring 

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operations, to the satisfaction of the New Jersey Department of Environmental Protection (‘‘DEP’’) and Landlord. If Tenant has not fully complied with ISRA prior to the expiration or sooner termination of the Lease, then Tenant, at Landlord’s option and in addition to all other rights and remedies of Landlord under this Lease, at law, in equity or otherwise, shall forfeit the full amount of the Security. In addition to the foregoing, Tenant shall obtain and deliver to Landlord, at no cost or expense to Landlord and at least thirty (30) days prior to the expiration of the Term or any assignment of this Lease or subletting of the Premises, a letter from the DEP stating that termination of Tenant’s operations at the Premises does not trigger ISRA, together with true copies of any affidavits on which such letter is based. If Landlord shall have to comply with ISRA by reason of Landlord’s actions, Tenant shall promptly provide all information requested by Landlord for preparation of non-applicability affidavits or a negative declaration and shall promptly sign such affidavits when requested by Landlord.

ARTICLE 8    ALTERATIONS

Section 8.1    Permitted Alterations.    Tenant shall be permitted to make any Alteration(s) which (i) are not structural in nature and/or do not affect the structural portions of the Building, (ii) do not exceed Ten Thousand Dollars ($10,000.00) in the aggregate during the Term and (iii) do not require any permit or other form of legal authority (collectively, ‘‘Permitted Alterations’’). Any and all other Alterations shall require the prior written consent of Landlord, which consent shall not be unreasonably withheld.

Section 8.2    Requirements.

(a)    All Alterations shall be made at no cost or expense to Landlord.

(b)    Tenant shall submit to Landlord a copy of any plans and specifications prepared in connection with any Alteration except Permitted Alterations (including layout, architectural, mechanical and structural drawings).

(c)    Before commencing any Alteration, Tenant shall provide any necessary and appropriate riders for fire and extended coverage, and commercial general liability and property damage insurance, covering the risks during the course of such Alteration and obtain and pay for all necessary permits and authorizations. Landlord agrees to join in the application for such permits or authorizations upon request of Tenant if necessary provided Landlord is promptly reimbursed for any filing or other costs, fees or expenses incurred and Tenant otherwise indemnifies Landlord for all losses, costs, claims and expenses incurred by Landlord in connection therewith.

(d)    All Alterations shall be made with reasonable diligence, in a good and workmanlike manner, by contractor(s) approved by Landlord in Landlord’s sole discretion and in compliance with all applicable Legal Requirements. Upon completion, Tenant shall obtain and deliver to Landlord any necessary amendment to the certificate of occupancy.

Section 8.3.    Ownership.    All Alterations shall remain the property of Tenant and shall be removed by Tenant upon expiration or earlier termination of the Lease. Notwithstanding the foregoing, Tenant may request Landlord’s consent to abandon any Alteration(s) provided such request is submitted to Landlord, in the form of a Notice, prior to commencing the Alteration. Landlord may grant or withhold its consent to such request in Landlord’s sole discretion and failure of the Landlord to respond to such request shall be deemed a denial. Any Alteration abandoned by Tenant with Landlord’s consent shall immediately become the sole property of Landlord.

ARTICLE 9    INSURANCE

Section 9.1    Tenant’s Coverages.

(a)    Commencing with the Commencement Date and throughout the Term, Tenant shall, at Tenant’s cost and expense, provide and cause to be maintained:

(i)    commercial general liability insurance (including contractual liability coverage) insuring against claims for bodily injury, death or property damage that may arise from or be 

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occasioned by (x) the condition, use or occupancy of the Premises, the sidewalks adjacent thereto, and the loading docks and other appurtenances, or (y) any act, omission or negligence of Tenant, its subtenants, or their respective contractors, licensees, agents, servants, employees, invitees or visitors; such insurance to afford minimum protection of not less than $3,000,000.00 combined single limit on an occurrence basis. The liability insurance requirements hereunder may be reviewed by Landlord every two (2) years for the purpose of increasing (in consultation with their respective insurance advisors) the minimum limits of such insurance from time to time to limits which shall be reasonable and customary for similar facilities of like size and operation in accordance with generally accepted insurance industry standards;

(ii)    ‘‘All-risk’’ insurance (including coverages against loss or damage by fire, lightning, windstorm, hail, explosion, vandalism and malicious mischief, riot and civil commotion, smoke and all other perils now or hereafter included in extended coverage endorsements) covering Tenant’s merchandise, inventory, trade fixtures, furnishings, equipment and leasehold improvements for the full replacement value on an agreed amount basis, including all items of personal property of Tenant located on, in or about the Premises, in an amount equal to one-hundred percent (100%) of the actual replacement cost thereof (with provisions for a deductible as shall be reasonable in comparison with similar properties); and

(iii)    during performance of any Alteration, Tenant shall maintain Worker’s Compensation, public liability and builder’s risk form of casualty insurance in amounts appropriate to the status of the construction being performed by Tenant. In addition, all contractors working on behalf of Tenant shall provide evidence of coverage, equal to the requirements of Tenant, naming Landlord as an additional insured.

(b)    If Tenant fails to maintain the insurance to be maintained by Tenant hereunder, the same may be purchased by Landlord at the expense of Tenant, and the expense therefor incurred by Landlord, with interest thereon at the Interest Rate, shall be forthwith paid to Landlord as Additional Rent after rendition of a bill or statement therefor.

(c)    All insurance policies required to be maintained by Tenant pursuant to this Article shall be effected under policies issued by insurers which are permitted to do business in the State where the Complex is situated and rated ‘‘A/VIII’’ by A.M. Best Company, or any successor thereto. Tenant shall provide to Landlord, and to any Fee Mortgagee, certificates of the policies required to be maintained pursuant to this Lease. Each such policy shall contain a provision that no act or omission of the insured shall affect or limit the obligation of the insurance company to pay the amount of any loss sustained and an agreement by the insurer that such policy shall not be modified or canceled without at least 30 days’ prior notice to Landlord and to any Fee Mortgagee.

(d)    All policies of insurance provided for under this Article, except Workers’ Compensation, shall name the Tenant as the insured, and Landlord and Landlord’s managing agent as additional insureds, and any Fee Mortgagee pursuant to a standard first mortgagee clause, subject in all respects to the terms of this Lease.

(e)    Any insurance provided for in this Article may be effected by a blanket policy or policies of insurance, provided that the amount of the total insurance available shall be at least the protection equivalent to separate policies in the amounts herein required, and provided further that in other respects, any such policy or policies shall comply with the provisions of this Article. An increased coverage or ‘‘umbrella policy’’ may be provided and utilized to increase the coverage provided by individual or blanket policies in lower amounts, and the aggregate liabilities provided by all such policies shall be satisfactory provided they otherwise comply with the provisions of this Article.

(f)    Each policy carried by Tenant shall be written as a primary policy not contributing with, and not in excess of, coverage carried by Landlord and/or Landlord’s managing agent.

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Section 9.2    Landlord’s Coverages.    Commencing with the Commencement Date and throughout the Lease Term, Landlord shall maintain, or cause to be maintained:

(a)    ‘‘All-risk’’ insurance covering the Complex, in an amount equal to one-hundred percent (100%) of the actual replacement cost thereof (exclusive of the cost of excavations, pavement, foundations and footings) with or without provisions for a deductible as shall be reasonable in comparison with similar properties;

(b)    commercial general liability insurance (including contractual liability) covering the Common Areas, in an amount not less than $5,000,000 for personal and bodily injury to all persons in any one occurrence and for property damage;

(c)    rent insurance, for the benefit of Landlord, covering the risks referred to in Paragraph (a) above, in an amount equal to all Rent payable for a period of twelve (12) months commencing on the date of loss;

(d)    if at any time a steam boiler or similar equipment is located in, on or about the Building, a policy insuring against loss or damage due to explosion, rupture or other failure of any boiler, pipes, turbines, engines or other similar types of equipment; and

(e)    other coverage as Landlord may reasonably deem necessary and appropriate.

If by reason of failure of Tenant to comply with the provisions of this Lease, including but not limited to the manner in which Tenant uses or occupies the Premises, Landlord’s insurance rates shall on the Commencement Date or at any time thereafter be higher than such rates otherwise would be, then Tenant shall reimburse Landlord, as Additional Rent hereunder, for that part of all insurance premiums thereafter paid or incurred by Landlord, which shall have been charged because of such failure or use by Tenant, and Tenant shall make such reimbursement upon the first day of the month following the billing to Tenant of such additional cost by Landlord.

Section 9.3    Waiver of Subrogation.    Every insurance policy carried by either party shall include provisions denying to the insurer subrogation rights against the other party and any Fee Mortgagee to the extent such rights have been waived by the insured prior to the occurrence of damage or loss. Each party hereby waives any rights of recovery against the other party for any direct damage or consequential loss covered by said policies against which such party is protected, or required hereunder to be protected, by insurance or (by the inclusion of deductible provisions therein or otherwise) has elected to be self-insured, to the extent of the proceeds paid under such policies and the amount of any such self-insurance, whether or not such damage or loss shall have been caused by any acts or omissions of the other party.

ARTICLE 10    DAMAGE AND DESTRUCTION; EMINENT DOMAIN

Section 10.1    Termination Due to Damage or Destruction.    If the Premises, or any portion thereof, shall be damaged by fire or other casualty, Tenant shall immediately give Notice thereof to Landlord. If the Building shall be damaged or destroyed to the extent that the estimated cost of repair or restoration of the damage or destruction shall be in excess of twenty five percent (25%) of the replacement cost of the Building, then Landlord shall have the right to terminate this Lease by giving notice of such election to Tenant within sixty (60) days after such damage or destruction shall have occurred. If such notice shall be given, this Lease shall terminate as of the date of Tenant’s receipt of such Notice. Landlord shall not be required to restore or rebuild the damaged or destroyed Premises, or any portion thereof, and all insurance proceeds payable on account of such damage or destruction may be retained by Landlord.

Section 10.2    Taking.

(a)    If a Taking of all or substantially all of the Premises occurs, then this Lease shall terminate as of the Vesting Date. If there is a Taking of less than substantially all of the Premises, then this Lease shall terminate on the Vesting Date with respect to the portion so taken.

(b)    If there is a Taking of part of the Complex but none of or less than substantially all of the Premises, Landlord may elect to terminate this Lease if (i) there is any Taking occurring 

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during the last two (2) years of the Term; or (ii) in Landlord’s reasonable judgment, it shall not be economically feasible to restore and replace the Building, the Premises, the Common Areas, the Complex or part thereof, to tenantable condition capable of being operated as a mixed use complex in an economical manner. If Landlord elects to terminate this Lease pursuant to this Section, Landlord shall, within one hundred twenty (120) days of the Taking, give notice to Tenant, and the Term shall expire and come to an end as of the last day of the calendar month in which such notice is given.

(c)    If there is a Taking of less than substantially all of the Premises, Tenant, subject to Landlord’s lenders’ requirements, may elect to terminate this Lease if, by reason of the Taking (i) more than thirty-three percent (33%) of the Square Feet within the Premises shall be taken; (ii) there is a prohibition of the use of the Premises for Tenant’s actual permitted use thereof; or (iii) there is any Taking of the Premises occurring during the last two (2) years of the Term. If Tenant elects to terminate this Lease pursuant to this Section, Tenant shall, within one hundred twenty (120) days of the Taking, give notice to Landlord, and the Term shall expire and come to an end as of the last day of the calendar month in which such notice is given.

(d)    If there is a Taking, then commencing on the Vesting Date, Base Rent shall be the product of (i) Base Rent immediately preceding the Taking, and (ii) a fraction, the numerator of which shall be the number of Square Feet within the Premises remaining after the Taking, and the denominator of which shall be the number of Square Feet within the Premises immediately preceding the Taking.

(e)    Tenant shall not be entitled to and hereby waives any and all claims against Landlord for any compensation or damage for loss of use of the Premises, the Common Areas or any portion thereof, for any interruption of services required to be provided by Landlord hereunder, and/or for any inconvenience or annoyance resulting from any damage, destruction, repair or restoration.

(f)    All compensation awarded or paid in respect of a Taking shall belong to and be the property of Landlord without any participation by Tenant. Nothing herein shall be construed to preclude Tenant from prosecuting any claim directly against the condemning authority in such condemnation proceeding for moving expenses; any fixtures or equipment owned by Tenant; and the unamortized cost of Tenant’s betterments and improvements, provided that no such claim shall (x) diminish or otherwise adversely affect Landlord’s award or the award of any Fee Mortgagee, or (y) include any value for the leasehold estate created hereby or the unexpired term of this Lease.

Section 10.3    Restoration by Landlord.    If the whole or any part of the Premises or Building shall, during the Term, be damaged or destroyed by fire or other casualty, or any portion of the Premises be Taken, and this Lease is not terminated pursuant to the terms hereof, Landlord shall, to the extent of insurance proceeds or award received by Landlord, repair, restore and/or rebuild the Premises and or Building substantially to the condition and character existing as of the Commencement Date. In no event shall Landlord be required to repair or replace any Personalty.

ARTICLE 11    RENT ABATEMENT

(a)    For purposes of this Article only, the Premises, or any portion thereof, shall be considered ‘‘Untenantable’’ if Tenant is, in fact, unable to engage in its regular business practices in the Premises due to (i) damage or destruction, (ii) loss of utilities, HVAC or elevator service, which loss is within the ability of Landlord to control, or (iii) a Taking, and (iv) the Premises is not rendered Untenantable by reason of any negligent or willful act of Tenant, its agents, servants or employees.

(b)    If all or part of the Premises are rendered Untenantable, Tenant shall, within five (5) business days after the occurrence, notify Landlord that the Premises, or a part thereof, has been rendered Untenantable (a ‘‘Rent Abatement Notice’’). The Rent Abatement Notice shall be in writing, shall specify (i) the nature of the cause of the Untenantability, (ii) the area(s) of the 

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Premises Tenant claims to be Untenantable and (iii) the date the space became Untenantable. The Rent Abatement Notice shall be delivered to Landlord in the manner required under this Lease for delivery of Notices. If a Rent Abatement Notice is not delivered to Landlord within the time and in the manner set out herein, then Tenant shall be deemed to have waived any right to abatement of Rent.

(c)    If the Premises are rendered Untenantable, in whole or in part, for a period of ten (10) or more business days, and the Lease is not terminated pursuant to the provisions hereof then Rent shall abate proportionately to the portion of the Premises rendered Untenantable from the date of the event causing the Untenantability and continuing until the Untenantability is remediated (the ‘‘Abatement Period’’). However, the necessity for the completion of any repair, restoration or other work to be performed by Tenant shall not provide the basis for abatement of Rent.

(d)    Determination of the percentage of Rent to be abated shall be reasonably made by Landlord. If Landlord and Tenant disagree on the extent of the Untenantability of the Premises, an appropriate third-party professional, designated by Landlord and reasonably acceptable to Tenant, shall certify to Landlord and Tenant as to the condition of the Premises (the ‘‘Abatement Certification’’), which Abatement Certification shall be binding upon both parties. The cost of obtaining the Abatement Certification shall be borne by Tenant and reimbursable to Landlord as Additional Rent.

(e)    Upon substantial completion of the remediation of the condition resulting in the Untenantability of the Premises, as reasonably determined by Landlord, the Abatement Period shall terminate. If Landlord and Tenant disagree on the date of substantial completion or the tenantability of any part of the Premises, an appropriate third-party professional, designated by Landlord and reasonably acceptable to Tenant, shall certify to Landlord and Tenant as to the condition of the Premises (the ‘‘Restoration Certification’’), which Restoration Certification shall be binding upon the parties. The cost of obtaining the Restoration Certification shall be borne by Tenant and reimbursable to Landlord as Additional Rent.

(f)    Anything to the contrary notwithstanding, there shall be no abatement of Rent for any portion of the Premises in which Tenant continues to operate its business, regardless of whether such portion of the Premises has been determined to be Untenantable.

ARTICLE 12    QUIET POSSESSION

Provided no Event of Default remains uncured, Tenant shall have and enjoy, during the Term, possession and use of the Premises and all appurtenances thereto which is quiet and undisturbed by Landlord, subject to the terms and provisions of this Lease. This covenant shall be construed as running with Landlord’s estate as owner of the Premises and is not, nor shall it operate or be construed as, a personal covenant of Landlord, except to the extent of Landlord’s interest in the Premises and only so long as such interest shall continue, and thereafter this covenant shall be binding only upon such subsequent owners and successors in interest, to the extent of their respective interests, as and when they shall acquire the same, and only so long as they shall retain such interest. Tenant shall not, through its acts or omissions, or the acts or omissions of Tenants employees, agents, servants or contractors, disturb the quiet possession of any other tenant or occupant of the Building.

ARTICLE 13    DEFAULT; REMEDIES AND DAMAGES

Section 13.1    Events of Default.    Each of the following shall be deemed an ‘‘Event of Default’’:

(a)    any failure by Tenant to pay Base Rent on the date it was payable under this Lease, or any failure by Tenant to pay Additional Rent or other sum of money payable under this Lease within five (5) days after notice from Landlord that such payment of Additional Rent or other sum is due;

(b)    any interest of Tenant passes to another except as permitted under Article 5;

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(c)    if proceedings in bankruptcy shall be instituted by or against any guarantor of this Lease, or if any guarantor of this Lease shall file, or any creditor or other person shall file, any petition in bankruptcy under any law, rule or regulation of the United States of America or of any State, or if a receiver of the business or assets of Tenant or of any guarantor of this Lease shall be appointed, or if a general assignment is made by Tenant for the benefit of creditors, or any sheriff, marshal, constable or other duly constituted public official takes possession of the Premises, or any part thereof, by authority of any attachment or execution proceedings, and offers same for sale publicly, and, with respect to any of the foregoing actions which shall be involuntary on Tenant’s part, such action is not vacated or withdrawn within thirty (30) days thereafter;

(d)    failure to pay Rent in a timely fashion three (3) or more times in any twelve (12) calendar month period or four (4) or more times during the Term;

(e)    any other failure by Tenant to perform any of the other terms, conditions or covenants of this Lease to be observed or performed by Tenant (for which notice and/or cure periods are not otherwise set forth in this Lease) for more than twenty (20) days after notice of such default shall have been given to Tenant, or if such default is of such nature that it cannot with due diligence be completely remedied with said period of twenty (20) days such longer period of time as may be reasonably necessary to remedy such default provided Tenant shall commence within said period of twenty (20) days and shall thereafter diligently prosecute to completion, all steps necessary to remedy such default, but in no event more than ninety (90) days after notice of such default shall have been given to Tenant; and

(f)    an Event of Default provided for under any other section of this Lease.

Section 13.2    Remedies.

(a)    If an Event of Default shall occur, Landlord shall, in addition to any other right or remedy available at law, in equity or otherwise, have the right:

(i)    to bring suit for the collection of Rent and/or other amounts for which Tenant may be in default, or for the performance of any other covenant or agreement devolving upon Tenant, all with or without entering into possession or terminating this Lease;

(ii)    terminate this Lease and dispossess Tenant and any other occupants thereof, remove their effects not previously removed by them and hold the Premises free of this Lease; or

(iii)    without terminating this Lease, re-enter the Premises by summary proceedings and dispossess Tenant and any other occupants thereof, remove their effects not previously removed by them and hold the Premises free of this Lease. No such re-entry or taking possession of the Premises by Landlord shall be construed as election on its part to terminate this Lease unless a written notice of such intention be given to Tenant or unless such termination is decreed by a court of competent jurisdiction. Landlord may remove all persons and property from the Premises in accordance with this Section, and store such property in a public warehouse or elsewhere at the cost of and for the account of Tenant, without service of notice or resort to legal process (all of which Tenant expressly waives) and without being guilty of trespass or becoming liable for any loss which may be occasioned thereby.

(b)    After such a dispossession or removal, (x) Rent shall be paid up to the date thereof, (y) Landlord may relet the Premises or any part or parts thereof either in the name of Landlord or otherwise, for a term or terms which may, at the option of Landlord, be less than or exceed the period which would otherwise have constituted the balance of the Term, and (z) Tenant shall pay to Landlord any deficiency between the Rent due hereunder plus the reasonable costs and expenses incurred or paid by Landlord in terminating this Lease or in re-entering the Premises and in securing possession thereof, as well as the expenses of reletting the Premises, including, without limitation, repairing, altering and preparing the Premises for new tenants, brokers’ commissions, legal fees, and other expenses and concessions (‘‘Default Costs’’), and the amount of 

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rents and other charges collected on account of the new lease or leases of the Premises for each month of the period which would otherwise have constituted the balance of the Term (not including any renewal periods, the commencement of which shall not have occurred prior to such dispossession or removal). Such deficiency shall be paid by Tenant in monthly installments on the dates specified in this Lease for payment of Base Rent. Landlord reserves the right to bring actions or proceedings for the recovery of any deficits remaining unpaid without being obliged to await the end of the Term for a final determination of Tenant’s account, and the commencement or maintenance of any one or more actions or proceedings shall not bar Landlord from bringing other or subsequent actions or proceedings for further accruals pursuant to the provisions of this Section. Any rent received by Landlord from such reletting shall be applied first to the payment of any indebtedness (other than Rent due hereunder) of Tenant to Landlord; second, to the payment of any Default Costs; third, to the payment of Rent due and unpaid hereunder, and the balance, if any, shall be held by Landlord and applied in payment of future Rent as it may come due and payable hereunder. In the alternative, following any such dispossession or removal, Landlord may claim as damages no more than the difference between the balance of Base Rent and Additional Rent payable over the remainder of the Term and the fair market rental value of the Premises over the same period, discounted to present value at a discount rate equal to the then effective rate on obligations of the U.S. Treasury having a maturity closest to the number of months remaining in the Term.

(c)    Landlord agrees to use commercially reasonable efforts to mitigate any damages occasioned by Tenant’s default. Tenant agrees that Landlord’s duty to mitigate (i) shall arise only after Landlord regains possession of the Premises, (ii) shall be deemed satisfied if Landlord has used commercially reasonable efforts to relet the Premises, whether or not such efforts are successful, and (iii) shall not require Landlord to market the Premises ahead of other space which is vacant or about to become vacant in properties owned by Landlord or its affiliates within five (5) miles of the Premises.

(d)    In addition to the foregoing, if an Event of Default shall occur other than as to the payment of Rent, Landlord, in addition to any other right or remedy available at law or in equity, shall have the right, but not the obligation, to cure such failure. Notwithstanding the above, if, in Landlord’s reasonable judgment, an emergency shall exist, Landlord may cure such Event of Default upon such notice to Tenant as may be reasonable under the circumstances (and may be without any prior notice if the circumstances shall so require). If Landlord cures such failure as aforesaid, Tenant shall pay to Landlord on demand, as Additional Rent, the reasonable and necessary cost or amount thereof, together with interest thereon at the Interest Rate from the date of outlay of expense until payment.

(e)    If there is a breach by Tenant, or any persons claiming through or under Tenant, of any term, covenant or condition of this Lease, Landlord shall have the right to enjoin such breach and the right to invoke any other remedy allowed by law or in equity as if re-entry, summary proceedings and other special remedies were not provided in this Lease for such breach.

(f)    The right to invoke the remedies hereinbefore set forth is cumulative and shall not preclude Landlord from invoking any other remedy allowed at law, in equity or otherwise.

(g)    If Tenant fails to pay any Rent when due (i.e. the Event of Default is strictly monetary), any period of ‘‘free Rent’’ during the Term shall be deemed null and void and Rent for such ‘‘free Rent’’ period, at the rate of the monthly Base Rent in effect immediately after the end of such ‘‘free Rent’’ period, shall immediately become due and payable.

Section 13.3    Landlord’s Default.

(a)    If Landlord shall fail to observe, perform or comply with any of its duties and obligations as set forth in this Lease for a period of thirty (30) days after notice thereof from Tenant to Landlord, or if such failure is of such a nature that it cannot be completely remedied within said period of thirty (30) days, if Landlord shall not (x) promptly upon the giving by Tenant of such notice, advise Tenant of Landlord’s intention to institute reasonable steps 

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necessary to remedy such failure, (y) promptly institute and thereafter diligently prosecute to completion reasonable steps necessary to remedy same, and (z) complete such remedy within a reasonable time after the date of the giving of said notice by Tenant, Tenant may at any time thereafter cure such breach or failure, but only if such breach or failure is creating a material impairment to the operation of Tenant’s business at the Premises, for the account of Landlord, provided that Tenant may cure any such breach or failure as aforesaid prior to the expiration of said waiting period, without notice to Landlord if an emergency situation exists, or after notice to Landlord, but solely if the curing of such breach or failure prior to the expiration of said waiting period is necessary to protect the Premises or Tenant’s interest therein or to prevent injury to persons or material damage to property. Landlord shall reimburse Tenant for the amounts reasonably and properly incurred by Tenant as aforesaid within thirty (30) days of Tenant’s written demand therefor. In no event whatsoever, however, shall Tenant have a right to terminate this Lease by reason of Landlord’s default, nor shall Landlord be liable to Tenant for any consequential, incidental or punitive damages in connection with or as a result of any default by Landlord hereunder. For the purposes of this Section, lost sales and/or profit shall be deemed to be consequential damages.

(b)    Notwithstanding that certain additional rights or remedies may now or hereafter be available to Tenant at law, in equity or otherwise, the rights and remedies as, when and to the extent specifically provided Tenant in Subsection (a) hereof shall be Tenant’s sole and exclusive rights and remedies under this Lease in the event of Landlord’s failure to observe, perform or comply with any of its duties and obligations of this Lease on its part to be observed, performed or complied within the time periods provided in this Lease.

ARTICLE 14    UNAVOIDABLE DELAYS, FORCE MAJEURE

With the exception of Tenant’s obligation to pay Rent, if Landlord or Tenant shall be prevented or delayed from punctually performing any obligation or satisfying any condition under this Lease by any strike, lockout, labor dispute or other labor trouble, inability to obtain labor, materials or reasonable substitutes therefor, act of God, weather, soil conditions, site conditions, present or future governmental restrictions, regulation or control, governmental pre-emption or priorities or other conflicts in connection with a national or other public emergency or shortages of fuel, supply of labor resulting therefrom, insurrection, sabotage, fire or other casualty, or any other condition beyond the control of the party required to perform, other than unavailability of funds or financing (individually and collectively ‘‘Unavoidable Delays’’), then the time to perform such obligation or satisfy such condition shall be extended by the delay caused by such event. If either party shall, as a result of an Unavoidable Delay, be unable to exercise any right or options within any time limit provided therefor in this Lease, such time limit shall be deemed extended for a period equal to the duration of such Unavoidable Delay. This Lease and the obligations of Tenant to pay Rent hereunder and perform all of the other covenants, agreements, terms, provisions and conditions hereunder on the part of Tenant to be performed shall in no way be affected, impaired or excused because Landlord is unable to fulfill any of its obligations under this Lease as a result of any Unavoidable Delay.

ARTICLE 15    NOTICES

(a)    Unless specifically provided to the contrary in this Lease, any notices, consents, approvals, elections, submissions, requests or demands required or permitted to be given under this Lease or pursuant to any law or governmental regulation (individually and collectively, a ‘‘Notice’’) by Landlord to Tenant or by Tenant to Landlord shall be in writing (whether or not expressly so provided) and delivered to the recipient at the respective addresses set forth in the Basic Provisions of this Lease, or, in the case of Notices to Tenant, to the Premises.

(b)    Notices shall be deemed delivered upon (i) personal delivery; (ii) three (3) calendar days after being deposited in the United States mail, registered or certified mail, return receipt requested, postage prepaid; or (iii) one (1) business day after being sent by overnight express mail or nationally recognized courier service (e.g., Federal Express) to Landlord or Tenant, at the 

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respective addresses set forth in the Basic Provisions of this Lease, and shall be deemed received upon actual receipt or rejection. Notices may be signed by the attorneys for the party on whose behalf the notice is sent. Changes in addresses may be designated by written notice as provided in this Article.

ARTICLE 16    ACCESS

Landlord and any Fee Mortgagee and any lessor under any ground or underlying lease, and their respective representatives, may enter the Premises at all times, upon reasonable advance notice to Tenant, for the purposes of (a) responding to emergency situations, (b) inspection, (c) making Repairs, replacements or improvements in or to the Premises or the Building or equipment, (d) performing other obligations of Landlord or Tenant pursuant to this Lease, (e) complying with any Legal Requirements, (f) exercising any right reserved to Landlord by this Lease (including the right during the progress of any such Repairs, replacements or improvements or while performing work and furnishing materials in connection with the compliance with any such Legal Requirements to keep and store within the Premises all necessary materials, tools and equipment) or (g) during the period commencing twelve (12) months prior to the end of the Term, for the purpose of exhibiting same to prospective tenants. Nothing herein contained, however, shall be deemed or construed to impose upon Landlord or any Fee Mortgagee or lessor, any obligation, responsibility or liability whatsoever for the care, supervision or repair of the Premises or Building or any parts thereof other than as herein provided. If a representative of Tenant shall not be personally present to open and permit an entry into the Premises at any time when an entry shall be reasonably necessary or permissible hereunder, Landlord or its agents may enter by a master key or may, in case of emergency, forcibly enter the same without rendering Landlord or its agents liable therefor (provided that, during such entry, reasonable care shall be accorded to avoid damage or injury to Tenant’s property), and without in any manner affecting the obligations and covenants of this Lease. Without incurring any liability to Tenant, Landlord may permit access to the Premises and open the same, whether or not Tenant shall be present, upon demand of any receiver, trustee, assignee for the benefit of creditors, sheriff, marshal or court officer entitled to, or reasonably purporting to be entitled to, such access for the purpose of taking possession of, or removing, Tenant’s property or for any other lawful purpose (but this provision and any action by Landlord hereunder shall not be deemed a recognition by Landlord that the person or official making such demand has any right or interest in or to this Lease, or in or to the Premises), or upon demand of any representative of the fire, police, building, sanitation or other department of Governmental Authorities.

ARTICLE 17    SIGNS

Tenant shall place no signs upon the Premises, Building or Complex except as permitted by Landlord in its sole discretion. Tenant acknowledges and agrees that Landlord may desire to have standardized signage and Tenant agrees to conform with such signage requirements.

ARTICLE 18    END OF TERM

Upon the expiration or other termination of the Term, Tenant shall peaceably and quietly quit and surrender the Premises to Landlord. The Premises shall be delivered in substantially the same condition as on the Commencement Date, broom clean, in good order and condition, reasonable wear and tear excepted, and otherwise in accordance with the terms of this Lease. Any Rent which is payable to the Expiration Date or earlier termination of this Lease which is not then ascertainable shall be paid to Landlord when the same is determined. Any Personalty remaining in the Premises after possession of the Premises has been returned to Landlord shall be deemed abandoned by Tenant to Landlord. Landlord shall have the right to dispose of the Personalty in any manner Landlord deems appropriate. Tenant agrees to indemnify and hold Landlord harmless from any and all (i) costs and expenses incurred by Landlord for the removal or disposal of the Personalty, and (ii) claims by third parties for ownership, obligation, payment, debt, loss or damage to any item or items of Personalty so abandoned. The provisions of this Article shall survive the Expiration Date or earlier termination of this Lease.

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ARTICLE 19    HOLDING OVER

Should Tenant hold over in possession after the Expiration Date, such holding over shall not be deemed to extend the Term or renew this Lease. Tenant agrees to indemnify and save Landlord harmless from and against all claims, losses, damages, liabilities, costs and expenses (including, without limitation, reasonable attorneys’ fees and disbursements) resulting from delay by Tenant in surrendering the Premises, including, without limitation, any claims made by any succeeding tenant founded on such delay. The parties recognize and agree that the damage to Landlord resulting from any failure by Tenant to timely surrender possession of the Premises will be extremely substantial, will exceed the amount of the Rent and will be impossible to accurately measure. Tenant therefore agrees that if possession of the Premises is not surrendered to Landlord on the Expiration Date, in addition to any other rights and remedies Landlord may have hereunder or at law, and without in any manner limiting Landlord’s right to demonstrate and collect any damages suffered by Landlord and arising from Tenant’s failure to surrender the Premises as provided herein, Tenant shall pay to Landlord on account of use and occupancy of the Premises for each month and for each portion of any month during which Tenant holds over after the Expiration Date, a sum equal to two hundred percent (200%) of the aggregate of that portion of the Rent which was payable under this Lease during the last month of the Term. Nothing herein shall be deemed to permit Tenant to retain possession of the Premises after the Expiration Date or to limit in any manner Landlord’s right to regain possession of the Premises through summary proceeding or otherwise, and no acceptance by Landlord of payments from Tenant after the Expiration Date shall be deemed to be other than on account of the amount to be paid by Tenant in accordance with the provisions of this Article. The provisions of this Article shall survive the Expiration Date.

ARTICLE 20    INDEMNITY

Section 20.1    Indemnity.

(a)    Neither Landlord nor Tenant shall do or permit any act or thing to be done in or about the Premises which may subject the other party to any liability or responsibility for injury, damages to persons or property or to any liability by reason of any violation of any Legal Requirement.

(b)    Tenant shall exercise such control over the Premises as to fully protect Landlord against any such liability. Tenant shall indemnify and save the Landlord, the members comprising Landlord and its and their partners, shareholders, members, officers, directors, employees, agents and contractors (the ‘‘Indemnitees’’) harmless from and against (x) all claims of whatever nature against the Indemnitees arising from Tenant’s occupancy of the Premises, or from any act, omission or negligence of Tenant, its contractors, licensees, agents, servants, employees, invitees or visitors (including, without limitation, statutory liability and liability under worker’s compensation laws), (y) all claims against the Indemnitees arising from any accident, injury or damage whatsoever caused to any person or to the property of any person and occurring during the Term in or about the Premises, and (z) any breach, violation or non-performance of any covenant, condition or agreement in this Lease set forth and contained on the part of Tenant to be fulfilled, kept, observed and performed.

(c)    Landlord agrees to indemnify and hold Tenant, its agents, servants and employees, harmless from any loss or damages, including reasonable attorneys’ fees and costs, resulting from the gross negligence or willful misconduct of Landlord, its agents, servants and employees.

(d)    This indemnity and hold harmless agreement shall include indemnity from and against any and all liability, fines, suits, demands, costs and expenses of any kind or nature (including, without limitation, attorneys’ fees and disbursements) incurred in or in connection with any such claim or proceeding brought thereon, and the defense thereof.

Section 20.2    Defense.    If any claim, action or proceeding is made or brought against Landlord, Tenant, the Indemnitees or any of them, which claim, action or proceeding either Landlord or Tenant shall be obligated to indemnify against pursuant to the terms of this Lease, then, upon demand by the 

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indemnified party or any of them, the indemnitor, at its sole cost and expense, shall resist or defend such claim, action or proceeding in the name of such indemnified party, if necessary, by such attorneys as such indemnified party shall approve, which approval shall not be unreasonably withheld. Attorneys for the indemnitor’s insurer are hereby deemed approved for purposes of this Section. The provisions of this Section shall survive the expiration or earlier termination of this Lease.

ARTICLE 21    SUBORDINATION

Section 21.1    Fee Mortgage.    Landlord shall have the right at any time during the Term to subject its interest in the Premises, the Building, the Complex and/or this Lease to any one or more mortgages on Landlord’s interest therein (‘‘Fee Mortgage’’) and to renew, modify, consolidate, replace, extend and/or refinance any such Fee Mortgage. Landlord shall be entitled to all of the proceeds from any such Fee Mortgage at any time effected pursuant hereto.

Section 21.2    Subordination.    This Lease shall at all times be subordinate to any Fee Mortgage. The foregoing provisions shall be self-operative and no further instrument of subordination shall be required. If Landlord or any holder of any Fee Mortgage desires confirmation of such subordination, Tenant shall promptly execute, without charge therefor, any certificate that Landlord or the Fee Mortgagee may request, provided that such certificate does not modify the terms of this Lease.

Section 21.3    Attornment.    Notwithstanding the provisions of Section 21.2, should any Fee Mortgagee require that this Lease be prior rather than subordinate to any such Fee Mortgage, Tenant shall, within ten (10) days after request therefor by Landlord or such Fee Mortgagee, and without charge therefor, execute a document effecting or acknowledging such priority, which document shall contain, at the option of such requesting party, an attornment to the Fee Mortgagee, or any person acquiring the interest of Landlord as a result of any foreclosure or the granting of a deed in lieu of foreclosure, as landlord, upon the then executory terms and conditions of this Lease for the remainder of the Term. If a Fee Mortgage is foreclosed or title to the Premises transferred to a Fee Mortgagee by deed in lieu of foreclosure, Tenant shall attorn to Landlord’s successor.

ARTICLE 22    CERTIFICATES

On the request of either party, Landlord and Tenant shall execute, acknowledge and deliver to each other, within ten (10) days after request, a written instrument, duly executed and acknowledged, (i) certifying that this Lease has not been modified and is in full force and effect or, if there has been a modification, that this Lease is in full force and effect as modified, stating such modification, and that this Lease is the only lease between Landlord and Tenant affecting the Premises, (ii) specifying the dates to which Rent has been paid, (iii) stating whether or not, to the knowledge of the party executing such instrument, the other party hereto is in default and, if so, stating the nature of such default, (iv) stating whether or not there are then existing any credits, offsets or defenses against the enforcement of any provisions of this Lease, (v) stating the Commencement Date and the Expiration Date, (vi) stating which of any options to extend the Term have been exercised, (vii) stating that there are no actions, whether voluntary or otherwise, pending against Tenant under the bankruptcy laws of the United States or any state thereof, and (viii) stating such further information with respect to the Lease or the Premises as may reasonably be requested. Any such certificate may be relied upon by any prospective purchaser of the Complex, the Building or the Premises (or any portion of any of the foregoing) or of the interest of Landlord in any part thereof, by any mortgagee or prospective mortgagee thereof, by a lessor or prospective lessor thereof, by any lessee or prospective lessee thereof, or by any prospective assignee of any mortgage thereof. The failure of Tenant to execute, acknowledge and deliver to Landlord a statement in accordance with the provisions of this Article within ten (10) days after request therefor shall constitute an acknowledgment by Tenant, which may be relied on by any person who would be entitled to rely upon any such statement, that such statement as submitted by Landlord is true and correct.

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ARTICLE 23    PARKING SPACES; USE OF EXTERIOR AREAS

Section 23.1    Parking Spaces.

(a)    Tenant shall, without additional charge, have the use of the number of Parking Spaces stated in the Basic Provisions section of this Lease. Unless specifically stated otherwise, parking shall be on a non-designated, unassigned basis and in common with Landlord, the other tenants of the Complex and other vehicles permitted in the Complex.

(b)    Landlord reserves the right to issue parking permits, install a gate system, or impose any other system Landlord deems necessary for the use of the parking area, including requiring Tenant to affix parking stickers or other means of identification and/or furnish Landlord with the license plate numbers of vehicles operated or controlled by Tenant or its subtenants. Tenant agrees not to permit vehicles operated or controlled by Tenant or its subtenants to park in parking spaces allocated to others by Landlord. Landlord shall have the right to have vehicles violating the provisions of this Lease removed from the Complex at the cost and expense of the vehicle’s owner or operator.

(c)    Landlord shall not be required to keep parking spaces clear of unauthorized vehicles or to otherwise supervise the use of the parking area. Landlord reserves the right to change any existing or future parking area, roads or driveways, and may make any Repairs or alterations it deems necessary to the parking area, roads and driveways and to temporarily revoke or modify the parking rights granted to Tenant hereunder, provided that no such change shall permanently reduce the number of available parking spaces nor render the parking less accessible than at the Commencement Date (except for temporary periods when necessary repairs are being performed).

Section 23.2    Use of Exterior Areas.

(a)    Tenant shall not use the access driveway, parking areas and loading platforms so as to interfere with the use by others of the access driveways, parking areas, other loading areas and the vehicular traffic in and out of the Complex.

(b)    Except as specifically permitted under this Lease, Tenant shall have no right to use any part of the roof of the Building or the exterior Building walls.

(c)    Tenant may not utilize any portion of the Complex outside of the Premises for storage of any kind.

ARTICLE 24    WAIVER PROVISIONS

Section 24.1    Waivers.

(a)    Tenant hereby waives any right to rescind this Lease which Tenant might otherwise have pursuant to any Legal Requirement.

(b)    Tenant, on its own behalf and on behalf of all persons claiming through or under Tenant, including all creditors, hereby waives any and all rights which Tenant and all such persons might otherwise have under any present or future law to redeem the Premises, or to re-enter or repossess the Premises, or to restore the operation of this Lease, after Tenant shall have been dispossessed by a judgment or by warrant of any court or judge; or any re-entry by Landlord; or any expiration or termination of this Lease and the Term, whether such dispossess, re-entry, expiration or termination shall be by operation of law or pursuant to the provisions of this Lease.

(c)    Landlord and Tenant hereby waive trial by jury in any action, proceeding or counterclaim brought by either against the other upon any matters whatsoever arising out of or in any way connected with this Lease, Tenant’s use or occupancy of the Premises, and/or any claim of injury or damage. It is further mutually agreed that if Landlord commences any summary proceedings for non-payment of any Rent, Tenant will not interpose any non-mandatory or non-compulsory counterclaim of whatever nature or description in any such proceeding.

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Section 24.2    Non-Waiver.

(a)    The failure of Landlord to insist upon strict performance of any of the terms, covenants or conditions hereof shall not be deemed a waiver of any rights or remedies that Landlord may have and shall not be deemed a waiver of any subsequent breach or default in any of such terms, covenants or conditions. No provision of this Lease shall be deemed waived by Landlord unless such waiver is granted in writing signed by Landlord.

(b)    No payment by Tenant or receipt by Landlord of a lesser amount than the Rent herein stipulated and reserved shall be deemed to be other than on account of the earliest stipulated Rent then due and payable unless Landlord, in its sole discretion, elects to apply such payment to a later installment of Rent herein stipulated and reserved. No endorsement or statement on any check, or letter accompanying any rent check or payment shall be deemed an accord and satisfaction, and Landlord may accept the same without prejudice to Landlord’s right to recover any balance due or to pursue any other remedy in this Lease provided.

(c)    No failure by Landlord to enforce any of the Rules and Regulations against Tenant and/or any other tenant or occupant of the Complex shall be deemed a waiver thereof.

(d) No receipt of money by Landlord from Tenant with knowledge of the breach of any covenant or agreement of this Lease, or after the termination hereof, or after the service of any notice, or after the commencement of any suit, or after final judgment for possession of the Premises, shall be deemed a waiver of such breach, nor shall it reinstate, continue or extend the Term, or affect any such notice, demand or suit.

(e)    No act done or thing said by Landlord or Landlord’s agents shall constitute a cancellation, termination or modification of, or eviction or surrender under, this Lease, or a waiver of any covenant, condition or provision hereof, nor relieve Tenant of Tenant’s obligation to pay Rent hereunder. Any acceptance of surrender, waiver or release by Landlord and any cancellation, termination or modification of this Lease must be in writing signed by Landlord or by Landlord’s duly authorized representative. The delivery of keys to any employee or agent of Landlord shall not operate as a surrender or as a termination of this Lease, and no such employee or agent shall have any power to accept such keys prior to the termination of this Lease.

ARTICLE 25    MISCELLANEOUS

Section 25.1    Rules and Regulations.    Tenant shall comply with, and cause its employees, contractors, subtenants, licensees and business invitees to comply with, the Rules and Regulations. Landlord reserves the right from time to time to suspend, amend or supplement the Rules and Regulations and Tenant agrees to comply with all such Rules and Regulations upon notice of the same from Landlord. In the case of any conflict or inconsistency between the provisions of this Lease and any of the Rules and Regulations as originally promulgated or as changed, the provisions of this Lease shall control. Landlord agrees to make commercially reasonable efforts to enforce the Rules and Regulations against all tenants in the Complex in a consistent and non-discriminatory manner.

Section 25.2    Relationship of Parties.    Nothing contained in this Lease shall be construed to create the relationship of principal and agent, partnership, joint venture or any other relationship between the parties hereto other than the relationship of Landlord and Tenant. Nothing contained herein shall in any way impose any liability upon the members, officers, partners or directors of Landlord.

Section 25.3    Recording.    Neither Landlord nor Tenant shall record this Lease nor any memorandum, abstract or other form of this Lease.

Section 25.4    Captions.    The captions, section numbers, and index appearing in this Lease are inserted only as a matter of convenience and in no way define, limit, construe, or describe the scope or intent of such sections or articles nor in any way affect this Lease.

Section 25.5    Applicable Law.    This Lease shall be governed by, and construed in accordance with, the laws of the State in which the Complex is located. If any provision of this Lease or the 

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application thereof to any person or circumstances shall, to any extent, be found to be invalid or unenforceable, the remainder of this Lease shall not be affected thereby and each provision of this Lease shall be valid and enforceable to the fullest extent permitted by the law.

Section 25.6    Mechanics’ Liens.

(a)    Tenant shall not suffer or permit any liens to stand against the Premises or any part thereof, by reason of any work, labor, services or materials done for, or supplied to, or claimed to have been done for, or supplied to, Tenant or anyone holding the Premises or any part thereof through or under Tenant. If any such lien shall at any time be filed against the Premises, Tenant shall cause the same to be discharged of record within ten (10) days after receipt of Notice of the filing of same, by either payment, deposit or bond. If Tenant shall fail to discharge any such lien within such period, then, in addition to any other right or remedy of Landlord, Landlord may, but shall not be obligated to, procure the discharge of such lien either by paying the amount claimed to be due, or such greater amount as is otherwise required pursuant to Legal Requirements, by deposit in court or bonding, and/or Landlord shall be entitled, if Landlord so elects, to compel the prosecution of an action for the foreclosure of such lien by the lienor and to pay the amount of the judgment, if any, in favor of the lienor with interest, costs and allowances. Any amount paid or deposited by Landlord for any of the aforesaid purposes, and all legal and other expenses of Landlord, including counsel fees, in defending any such action or in or about procuring the discharge of such lien, with all necessary disbursements in connection therewith, together with interest thereon at the Interest Rate from the date of payment or deposit, shall become due and payable forthwith by Tenant to Landlord, or, at the option of Landlord, shall be payable by Tenant to Landlord as Additional Rent.

(b)    Nothing in this Lease shall be deemed to be, or construed in any way as constituting, the consent or request of Landlord, expressed or implied, by inference or otherwise, to any person, firm or corporation for the performance of any labor or the furnishing of any materials for any construction, rebuilding, alteration or repair of or to the Premises, or any part thereof, or as giving Tenant any right, power or authority to contract for or permit the rendering of any services or the furnishing of any materials, which might in any way give rise to the right to file any lien against or Landlord’s interest in the Premises. Landlord shall have the right to post and keep posted at all reasonable times upon the Premises any notices which Landlord shall be required so to post for the protection of Landlord and/or the Premises from any such lien.

Section 25.7    Brokerage.    Landlord and Tenant each represent that it dealt with no broker or brokers or other person in connection with the negotiation, execution and delivery of this Lease other than Broker. Landlord agrees to pay any commission due Broker in connection with this Lease pursuant to a separate agreement. Each party shall defend, indemnify and hold the other harmless from and against any claims or demands for any brokerage commissions, finder’s fees and/or other compensation resulting from a breach by it of the foregoing representation.

Section 25.8    Limitation of Landlord’s Liability; Authority.

(a)    The term ‘‘Landlord’’ as used in this Lease means only the owner of the Premises for the time being, so that in the event of any sale of Landlord’s interest in the Premises or in this Lease, Landlord shall be and hereby is entirely freed and relieved of all obligations of Landlord with respect to the Premises, and it shall be deemed without further agreement between the parties and such purchaser(s) or assignee(s) that the purchaser or assignee has assumed and agreed to observe and perform all obligations of Landlord hereunder relating to the Premises.

(b)    Except as the same may be attributable solely to the gross negligence or willful misconduct of the Landlord, its servants, agents, or employees, (i) all Personalty shall be kept at the sole risk of Tenant and Landlord shall not be considered the voluntary or involuntary bailee of same, (ii) Landlord shall bear no responsibility for damage or injury to Tenant or any of its officers, agents or employees or to any other persons or to any Personalty or to the business of the Tenant, or any interruption thereof.

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breach or default by Landlord under this Lease, Tenant shall look solely to the equity of Landlord in the Building for the satisfaction of Tenant’s claims, and to no other property or assets of Landlord. No constituent of Landlord including, without limitation, any agent, partner, member, shareholder, managing agent or otherwise shall be in any manner personally liable under this Lease.

Section 25.9    Attorneys’ Fees.    Should either party hereto institute any action or proceeding in court to enforce any provision hereof, or for damages or for declaratory or other relief hereunder, the prevailing party shall be entitled to receive from the losing party, in addition to court costs, such amount as the court may adjudge to be reasonable as attorneys’ fees for services rendered to said prevailing party, and said amount may be made a part of the judgment against the losing party.

Section 25.10    Arbitration.    In any case where this Lease provides for the settlement of a dispute by arbitration, the same shall be settled by arbitration under the auspices of the American Arbitration Association. The rules of the American Arbitration Association from time to time in effect shall apply (to the extent appropriate). Any award shall be enforceable by proper proceedings in any court having jurisdiction. The arbitrator, regardless of how appointed, may determine how the expenses of the arbitration, including reasonable attorney’s fees, and disbursements of the successful party, shall be borne as between Landlord and Tenant. Nothing in this Section shall preclude Landlord or Tenant from exercising their rights to make payments or perform any work to cure alleged defaults prior to or during the course of arbitration, if any delay in complying with any requirements of this Lease by Landlord or Tenant might subject the other to any fine or penalty, or to prosecution for a crime, or if it would constitute a default by Landlord under any mortgage.

Section 25.11    Non-Binding Until Executed.    This Lease is offered for signature by Tenant and it is understood that this Lease shall not be binding upon Landlord or Tenant unless and until Landlord and Tenant shall have executed and unconditionally delivered a fully executed copy of this Lease to each other. The acceptance by Landlord of the Security shall not render this Lease effective unless and until Landlord shall have executed and delivered to Tenant a fully executed copy of this Lease.

Section 25.12    No Claim for Damages.    Tenant hereby waives any claim against Landlord which Tenant may have based upon any assertion that Landlord has unreasonably withheld or delayed any consent or approval requested by Tenant, and Tenant agrees that its sole remedy shall be an action or proceeding to enforce any related provision or for specific performance, injunction or declaratory judgment. If there is a determination that such consent or approval has been withheld or delayed unreasonably, the requested consent or approval shall be deemed to have been granted; however, Landlord shall have no liability to Tenant for its refusal or failure to give such consent or approval. Tenant’s sole remedy for Landlord’s unreasonably withholding or delaying consent or approval shall be as provided in this Section.

Section 25.13    Independent Covenants.    Tenant agrees that Tenant’s covenants and obligations under this Lease shall be independent of Landlord’s covenants and obligations under this Lease and that each such covenant and obligation is independent of any other covenant or obligation. Landlord’s breach or non-performance of any of Landlord’s covenants or obligations under this Lease shall not excuse Tenant of Tenant’s covenants and obligations under this Lease, and shall not be the basis for any defense, of any kind or nature whatsoever, to any suit by Landlord for Tenant’s breach or non-performance of any of Tenant’s covenants or obligations under this Lease (including, without limitation, Tenant’s failure to pay Rent). It is the express agreement of Landlord and Tenant that all payments of Base Rent and Additional Rent due under this Lease are absolutely and unconditionally due at the time set forth herein, without any right of set-off or deduction of any kind or nature whatsoever except as expressly provided to the contrary in this Lease.

Section 25.14    Interpretation.    No provision of this Lease shall be construed against or interpreted to the disadvantage of either Landlord or Tenant by any court or other governmental or judicial authority by reason of either Landlord or Tenant having or being deemed to have drafted, structured or dictated such provision. The words ‘‘herein,’’ ‘‘hereof,’’ ‘‘hereunder,’’ ‘‘hereafter,’’ and the 

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words of similar import refer to this Lease as a whole and not to any particular Article, Section or subsection thereof, unless specifically stated otherwise.

Section 25.15    Entire Agreement.    This Lease and the exhibits attached hereto and forming a part hereof, set forth all the covenants, promises, agreements, conditions and understandings between Landlord and Tenant concerning the subject matter hereof and there are no covenants, promises, agreements, conditions or understandings heretofore made, either oral or written, between the parties other than as herein set forth. No modification, amendment, change or addition to this Lease shall be binding upon Landlord or Tenant unless reduced to writing and signed by each party.

Section 25.16    Binding Effect.    The covenants, agreements, terms, provisions and conditions of this Lease shall bind and benefit the respective successors, assigns and legal representatives of the parties hereto with the same effect as if mentioned in each instance where a party hereto is named or referred to, except that no violation of the provisions of this Lease shall operate to vest any rights in any successor, assignee or legal representative of Tenant. It is understood and agreed, however, that the covenants and obligations on the part of the Landlord under this Lease shall not be binding upon Landlord herein named with respect to any period subsequent to the transfer of its interest in the Building or Complex, that in the event of such transfer said covenants and obligations shall thereafter be binding upon each transferee of such interest of Landlord herein named, but only with respect to the period ending with a subsequent transfer of such interest, and that a lease of the entire interest shall be deemed a transfer within the meaning of this Section.

Section 25.17    Severability.    If any provision 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 shall not be affected thereby and each provision of this Lease shall be valid and enforceable to the fullest extent permitted by law.

Section 25.18    Relocation.    Landlord hereby reserves the right, at its sole expense and on at least thirty (30) days’ prior written Notice, to require Tenant to move from the Premises to other space within the Complex. The relocated space shall be of comparable size and decor. If Tenant is relocated pursuant to the provisions of this Section, Landlord will pay all reasonable, documented expenses of preparing and decorating the relocated space so that it will be substantially similar to the Premises from which the Tenant is moving and Landlord will also pay the reasonable, documented expenses of moving Tenant’s furniture and equipment to the relocated space. In such event, Landlord and Tenant shall execute a modification of or supplement to this Lease in respect of and identifying such other space, each and all of the terms, covenants and conditions hereof shall remain in full force and effect and thereupon be deemed applicable to such new space except that the description of the Premises, and the Building, if applicable, shall be revised and if applicable Tenant’s Percentage shall likewise be revised.

Section 25.19    Patriot Act.    Landlord and Tenant each represents and warrants to the other that, to their knowledge: (i) they are not acting, directly or indirectly, for or on behalf of any person, group, entity or nation named by the United States Treasury Department as a Specially Designated National and Blocked Person, or for or on behalf of any person, group, entity or nation designated in Presidential Executive Order 13224 as a person who commits, threatens to commit, or supports terrorism; and (ii) they are not engaged in this transaction directly or indirectly on behalf of, or facilitating this transaction directly or indirectly on behalf of, any such person, group, entity or nation

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IN WITNESS WHEREOF, the parties have this day set their hands and seals.

							
	Signed, Sealed and Delivered

In the presence of:			SOMERSET EXECUTIVE SQUARE ASSOCIATES, L.P. 
	 			By:			 
	 			 			Name:

 Title:
	 			TEAMSTAFF INC. 
	 			By:			 
	 			 			Name:

 Title:

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EXHIBIT A

Site Plan

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EXHIBIT B

Floor Plan

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EXHIBIT C

Rules and Regulations

1.    Tenant, its employees, agents, servants, visitors, licensees and invitees shall not:

(a)    obstruct or permit the obstruction of the sidewalks, entry passages, corridors, halls, stairways or elevators, or use the same in any way other than as a means of passage to and from the Premises

(b)    damage or defile any other part of the interior or exterior of the Building;

(c)    place anything on the outside of the Building, including roof setbacks, window ledges and other projections;

(d)    interfere with the heating or cooling systems;

(e)    use any electrical heating device;

(f)    use or permit the use of alcoholic beverages or tobacco, except as may be otherwise specifically permitted;

(g)    give its employees or other persons permission to go on the roof of the Building;

(h)    place door mats in public corridors,

(i)    conduct, or permit any other person or entity to conduct, any auction in the Premises or the Complex,

(j)    manufacture or store goods, wares or merchandise upon the Premises except in the ordinary course of Tenant’s business as allowed by the Permitted Use,

(k)    permit the Premises to be used for gambling,

(l)    burn any papers, trash or garbage of any kind,

(m)    throw substances of any kind out of the windows or doors, or down the passages of the Building, or in the halls or passageways,

(n)    cause or allow any use generally deemed to be obnoxious or a nuisance, make or allow any unusual or extraordinary lights, sounds, noises or music, or permit any unusual or strong odors.

2.    The Premises shall not be used for lodging, cooking or sleeping. The use of a microwave oven shall not be prohibited.

3.    No lock or locks shall be placed by Tenant on any door in the Building (including the Premises), without the prior written consent of Landlord. Tenant, its agents and employees shall not change any lock. All keys to doors and rest rooms shall be returned to Landlord on or before the termination of the Lease, and Tenant shall pay for any lost keys.

4.    Rest rooms, plumbing fixtures, other water apparatus and electrical outlets shall not be used for any purposes other than those for which they are constructed.

5.    All trash and garbage shall be stored in appropriate receptacles and in such manner so as not to create or permit any health hazard or fire hazard.

6.    No vehicles or animals of any kind shall be brought into or kept in or about the Premises, except animals such as seeing-eye dogs, etc., as may be reasonably required to accommodate the needs of individuals with disabilities. Bicycles may be brought into the Premises, but shall not be left in front of the Building.

7.    Business machines and mechanical equipment which cause vibration, noise, cold or heat that may be transmitted to the Building structure or to any leased space outside the Premises shall be placed and maintained by Tenant, at its sole cost and expense, in settings or cork, rubber or spring type vibration eliminators sufficient to absorb and prevent such vibration, noise, cold or heat.

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8.    Canvassing and soliciting in the Building are prohibited, and Tenant shall cooperate to prevent the same.

9.    No portion of the Complex may be used, directly or indirectly, by any person or legal entity other than Tenant, Tenants’ subtenants, agents, servants, employees licensees, invitees, contractors, customers and deliverymen.

10.    Landlord reserves to itself any and all rights not granted to Tenant and shall have the following additional rights:

(a)    to change the name and/or street address of the Building and the arrangement and/or location of entrances, passageways, doors, doorways, corridors, elevators, stairs, toilet or other public parts of the Building;

(b)    to install and maintain a sign or signs on the exterior of the Building;

(c)    to constantly have keys to the Premises;

(d)    to grant to anyone the exclusive right to conduct any particular business or undertaking in the Building;

(e)    to make such other and further reasonable Rules and Regulations, as in the reasonable judgment of Landlord, may from time to time be necessary and/or appropriate for the safety, appearance, care and cleanliness of the Building and for the preservation of good order therein. Landlord shall not be responsible to Tenant for any violation of Rules and Regulations by any other tenants.

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EXHIBIT D

LANDLORD’S WORK

1.    Landlord shall, at no additional cost to Tenant, provide Tenant with all of the items provided below. Upon substantial completion of the Landlord’s Work, which shall be deemed achieved notwithstanding the fact that in the Landlord’s reasonable opinion, minor or insubstantial details of construction, mechanical adjustment, or decoration remain to be performed, the noncompletion of which does not materially interfere with Tenant’s use of the Premises, and at such time as Landlord obtains a Certificate of Occupancy, Certificate of Completion, Certificate of Continued Occupancy or the required equivalent of any of them, Landlord shall deliver, and Tenant shall accept, possession of the Premises.

a.    Premises to be reconfigured as per Exhibit B.

b.    Paint the Premises with any one (1) color of Tenant’s choice of Building standard paint

c.    Re-carpet the Premises with any one (1) selection of Tenant’s choice of Building standard carpeting

2.    Tenant may request a pre-possession ‘‘walk through’’ of the Premises with a representative of the Landlord. If a walk through is requested by Tenant, Tenant and Landlord’s representative shall prepare a mutually agreed upon ‘‘punch list’’ of Landlord’s Work that is incomplete or in need of repair, which punch list shall be signed by Tenant and shall be conclusive and final. Landlord shall complete or correct all punch list items within a reasonable time after Tenant takes possession of the Premises.

3.    (a)    ‘‘Tenant Delay’’ means any actual delay in the completion of the Landlord’s Work that may arise as a result of: (i) Tenant’s failure to comply with its obligations to submit any plans and/or specifications, supply information, approve plans, specifications or estimates, or give authorizations within the time specified; (ii) any change made after notification to Tenant that a change will delay completion of the construction; (iii) extra time required to obtain any ‘‘long lead’’ items specified by Tenant, (iv) Tenant’s failure to allow Landlord, or its agents, access to the Premises, (v) Tenant’s interference, or failure to cooperate, with Landlord’s completion of the Landlord’s Work (vi) work, other than Landlord’s Work, being performed in the Premises by, or at the request of, Tenant, or (vii) delay that is otherwise the direct result of the act(s) or omission(s) of Tenant, its agents, servants or employees. For purposes of this section, an item shall be considered a ‘‘long-lead’’ item if Landlord notifies Tenant within ten (10) business days after receipt of Tenant’s approved construction drawings that such item is not readily available or readily installable after the same is requested by Tenant. Landlord shall not be responsible for any delays in the time for completion of construction resulting from Tenant’s Delay.

(b)    If Landlord determines that a change proposed by Tenant will delay completion of the Landlord’s Work, Landlord shall notify Tenant of the estimated length of delay caused by Tenant’s request. Tenant shall advise Landlord within one (1) business day after receipt of such notice as to whether Landlord shall proceed with requested change, modification or alteration. Landlord shall not make the requested change without Tenant’s approval of any proposed time extension. Any period beyond the permitted response time by Tenant shall be a day of Tenant Delay.

(c)    If Landlord determines that a Tenant Delay exists, Landlord shall so notify Tenant in writing. Any time period set out in this Lease which is contingent on completion of Landlord’s Work shall be extended by one (1) day for each day of Tenant Delay, beginning on the date Tenant receives notice of the Tenant Delay. If any Tenant Delay continues for a period of five (5) or more calendar days, Tenant shall pay Landlord, as Additional Rent, one day of the then current Base Rent (or the Base Rent that would be in effect upon commencement of the Lease) to compensate Landlord for the losses incurred by Landlord in delay of Tenant’s obligation to begin paying Rent upon completion of the Landlord’s Work.

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EXHIBIT E

RENEWAL OPTION

If no Event of Default remains uncured beyond any applicable cure period, Tenant shall have the option to renew (‘‘Renewal Option’’) this Lease for a period of sixty (60) months from the Expiration Date (the ‘‘Renewal Term’’) upon the terms and conditions herein set forth.

The Renewal Option shall be exercised, if at all, by Tenant giving written notice of exercise (‘‘Renewal Notice’’) to Landlord, which must be received by Landlord not less than nine (9) months prior to the Expiration Date. The Renewal Option shall be voidable by Landlord if the Renewal Notice is not received by Landlord on a timely basis.

During the Renewal Term all of the terms, covenants and conditions of this Lease shall continue to apply, except as specifically otherwise provided herein, and there shall be no additional right to renew this Lease.

The Base Rent for the Renewal Term shall be determined as follows:

(a)    Not later than thirty (30) calendar days after Landlord receives the Renewal Notice, Landlord shall deliver to Tenant a notice of the proposed Base Rent for each month of the Renewal Term (‘‘Landlord’s Rent Notice’’).

(b)    Not later than thirty (30) calendar days after receipt of Landlord’s Rent Notice, Tenant may deliver to Landlord a notice of its proposed Base Rent for each month of the Renewal Term (‘‘Tenant’s Rent Notice’’). Delivery of Tenant’s Rent Notice shall be deemed a rejection of Landlord’s Rent Notice. If Tenant does not deliver Tenant’ Rent Notice to Landlord in a timely fashion, then the Base Rent set out in Landlord’s Rent Notice shall be deemed accepted by both parties.

(c)    Not later than thirty (30) calendar days after receipt of Tenant’s Rent Notice, Landlord may deliver to Tenant a notice of its acceptance or rejection of Tenant’s proposed Base Rent. If Landlord does not deliver notice of its acceptance or rejection of the Tenant’s proposed Base Rent in a timely fashion, then Tenant’s proposed Base Rent shall be deemed rejected by Landlord.

(d)    If Landlord rejects Tenant’s proposed Base Rent, then the parties shall obtain an appraisal of the fair market Base Rent for the Premises prepared by a member of the American Institute of Real Estate Appraisers (‘‘Appraiser’’), which Appraiser is mutually acceptable to both Landlord and Tenant. The cost of the appraisal shall be shared equally by Landlord and Tenant. The Appraiser’s determination of the fair market Base Rent for the Renewal Term shall be final and binding on both parties.

Upon determination of the Base Rent for each month of the Renewal Term, Landlord shall prepare, and Tenant shall execute within ten (10) calendar days after receipt, an amendment to the Lease setting out the terms of the renewal.

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