Document:

Exhibit 10.8

 

EMPLOYMENT AGREEMENT

BETWEEN

J. PATRICK O’GRADY

AND

GMH COMMUNITIES TRUST

 

This Employment Agreement (the “Agreement”),
effective as of July 1, 2006 (“Effective Date”), between GMH
Communities Trust (the “Company”), and J. Patrick O’Grady (the “Executive”):

WHEREAS, the Company wishes to employ
the Executive in the capacities and on the terms and conditions set out below,
and the Executive has agreed to such employment, in the capacities and on the
terms and conditions set forth below.

NOW, THEREFORE, the Company and the
Executive, in consideration of the respective covenants set out below, hereby
agree as follows:

1.             EMPLOYMENT.

                (a)
POSITIONS.  The Executive shall be
employed by the Company as an Executive Vice President and Chief Financial Officer.  The Executive may also serve as an officer of
GMH Communities, L.P. (the “Partnership”), its subsidiaries and its general
partner.

(b)  DUTIES. 
The Executive’s principal employment duties and responsibilities shall
be those duties and responsibilities customary for the position of Executive
Vice President and Chief Financial Officer of the Company and such other
executive duties and responsibilities as the Company’s Board of Trustees (the “Board”)
shall from time to time reasonably assign to the Executive.  The Executive shall report directly to the
Company’s President, Chairman and Chief Executive Officer.

(c)  EXTENT OF SERVICES.  Except for illnesses and vacation periods,
the Executive shall devote a substantial majority of his business time and
attention and his best efforts to the performance of his duties and
responsibilities under this Agreement. 
Notwithstanding the foregoing, the Executive (i) subject to the
Executive’s obligations set forth in Section 11, may make any investment with
respect to which he is not obligated or required to, and does not in fact,
devote efforts that would cause him to be unable to devote a substantial
majority of his business time and attention and his best efforts to the
performance of his duties and responsibilities under this Agreement, (ii) may
participate in charitable, academic or community activities, and in trade or
professional organizations, or (iii) may hold directorships in other companies
consistent with the Company’s conflict of interest policies and corporate
governance guidelines as in effect from time to time.

2.             TERM.
This Agreement shall be effective as of the Effective Date and shall continue
in full force and effect thereafter for a period of three (3) years (the “Initial
Term”), and shall be automatically extended for as many as two additional one
(1) year periods (each, a 

 

 

 

“Successor Term”) at the close of the Initial Term and each Successor Term, unless
either party provides a written notice not less than 60 days prior to the end
of the Initial Term or relevant Successor Term of such party’s intent not to
renew, or the Agreement is sooner terminated pursuant to Section 7.  For purposes of this Agreement, “Term” shall
mean the actual duration of the Executive’s employment hereunder, taking into
account any extensions pursuant to this Section 2 or early termination of
employment pursuant to Section 7.

 

3.             BASE
SALARY. The Company shall pay the Executive a base salary annually (the “Base
Salary”), which shall be payable in periodic installments according to the
Company’s normal payroll practices.  The
initial Base Salary effective as of the Effective Date shall be $300,000
annually.  The Board Committee charged with responsibility for
officer employment and compensation matters of the Company (the “Compensation
Committee”) shall review the Base Salary at least once a year to determine
whether the Base Salary should be increased effective January 1 of any year
during the Term; provided, however, that on each January 1 during the Term, the
Base
Salary shall be increased by a minimum positive amount equal to the Base Salary
in effect on January 1 of the prior year multiplied by the percentage increase
in the Consumer Price Index applicable to such year.  The amount of the increase shall be determined
before March 31 of each year and shall be retroactive to January 1.  The Base Salary, including any increases,
shall not be decreased during the Term without the written agreement of the
Executive.  For purposes of this
Agreement, the term “Base Salary” shall mean the amount established and
adjusted from time to time pursuant to this Section 3.

4.             INCENTIVE AWARDS.  The Executive shall be entitled to receive an annual cash
incentive bonus for each calendar year during the Term of this Agreement
consistent with a bonus policy adopted by the Board or the Compensation
Committee for each calendar year (which bonus policy shall be adopted during
the first 90 days of each calendar year) containing individual performance
goals for participants and corporate performance goals set at Threshold, Target
and Superior levels, and allocating each participant’s annual cash incentive
bonus on a percentage basis between individual and corporate performance goals
(the “Bonus Policy”).  The Board or the
Compensation Committee shall meet during the first 90 days of each calendar
year (during the first 120 days for the 2006 calendar year) to determine the
relevant goals for the current calendar year and to reach determination
regarding bonus entitlement for the prior calendar year.  For each calendar year, the annual incentive
bonus shall be determined under the Bonus Policy in effect for such calendar
year with reference to the Executive’s attainment of his individual performance
goals and the Company’s attainment of the overall corporate goals, as follows:

total annual incentive bonus = individual
performance bonus + corporate performance bonus

 

where:

        individual
performance bonus = individual performance level achieved (Threshold,
Target or Superior percentage) x individual goals allocation percentage (40%) x
Base Salary

        corporate
performance bonus = corporate performance level achieved (Threshold, Target
or Superior percentage) x corporate goals allocation percentage (60%) x Base
Salary

 

The
percentages established for the Executive for the performance bonus levels for
2006 shall be 40% for Threshold Level and 80% for Target Level and 120% for
Superior Level.  Except to the 

 

 

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extent
otherwise provided in Section 8, no bonus shall be payable unless the Executive
was employed by the Company or a subsidiary as of the last day of the relevant
calendar year.  For 2006 and thereafter,
to the extent the Executive’s annual incentive bonus exceeds either a
performance bonus level of 100% or his then-current Base Salary, such excess
bonus amount may, at the sole discretion of the Company, be paid to the
Executive one-half in cash and one-half in Company Common Shares that shall
vest ratably over a period of three (3) years from the date of payment and
shall be subject to dividend payments, if any, by the Company.  If the Executive or the Company, as the case
may be, fails to satisfy the performance criteria contained in such Bonus
Policy for a calendar year, the Executive may be eligible to receive an
incentive bonus for such calendar year, in such amount as is recommended by the
Compensation Committee and subject to approval by the full Board (if such
approval is required).  The annual
incentive bonus shall be paid to the Executive no later than thirty (30) days
after the date on which final approval of the annual incentive bonus payable to
the Executive for such calendar year is obtained.  Notwithstanding anything to the contrary, the
Executive is guaranteed a cash bonus for the calendar year 2006 equal to no
less than $120,000, $100,000 of which shall be paid within five (5) business
days after the Effective Date, with the remainder being paid in accordance with
the normal provisions set forth in this Section 4.  Beginning with respect to 2007, any Annual Incentive
Bonus shall be awarded and paid pursuant to the formula provided above in this
Section 4.  For purposes of this
Agreement, the term “Annual Incentive Bonus” shall mean the amount established
pursuant to this Section 4.

5.             STOCK
BASED AWARDS.

(a)           OPTION
GRANTS.  The Company has established an
equity incentive plan (“Equity Incentive Plan”).  The Executive’s eligibility for grants under
the Equity Incentive Plan and the terms and conditions of such grants shall be
determined by the Compensation Committee.

(b)           RESTRICTED
SHARE AWARDS.  On the Effective Date, the
Company shall issue to the Executive 40,000 of the Company’s common shares of
beneficial interest, $0.001 par value (the “Common Shares”).  The issuance of these Common Shares shall be
pursuant to and in accordance with the terms and conditions of the restricted
share grant agreement, which shall provide, among other things, that 10,000 of the
Common Shares shall vest on the first anniversary of the Effective Date and
15,000 of such Common Shares shall vest on each of the second and third
anniversaries of the Effective Date, subject to the restrictions set forth in
the restricted share grant agreement.  In
addition, the Executive shall be eligible to receive further restricted Common
Shares of the Company (together with the initial grant of 40,000 Common Shares,
“Restricted Share Grants”) as approved by the Compensation Committee, but only
to the extent that restricted shares are available for issuance under the
Equity Incentive Plan.  The terms and
conditions of Restricted Share Grants shall be determined by the Compensation
Committee.  Any Common Shares issued as Restricted Share
Grants will have voting and dividend rights, and, following the restriction
period, shall be registered and fully transferable by the Executive.

6.             BENEFITS.

 

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(a)           VACATION.
The Executive shall
be entitled to an amount of vacation time consistent with Company policy
applicable to senior executives but at least five (5) weeks of paid vacation
per full calendar year, which shall accrue during the Executive’s employment
with the Company; provided, however, that the Executive can never accrue more
than ten (10) weeks of paid and unused vacation time during the Term of this
Agreement.

(b)           SICK
AND PERSONAL DAYS.  The Executive shall
be entitled to sick and personal days on an as needed basis.

(c)           EMPLOYEE
BENEFITS.

(i)            PARTICIPATION
IN EMPLOYEE BENEFIT PLANS. The Executive and his spouse and eligible dependents,
if any, and their respective designated beneficiaries where applicable, will be
eligible for and entitled to participate in all Company sponsored employee
benefits plan, as such plans may be amended or modified from time to time,
including but not limited to a 401(k) plan, group health, accident, disability
insurance, group life insurance and supplemental life insurance, as such
benefits may be offered from time to time, on a basis no less favorable than
that applicable to any other executive. 
Such benefits coverage shall be in the aggregate, not materially less
valuable to Executive than the benefits made available to the Executive
immediately prior to the Effective Date by his then employer.

(ii)           DEFERRED COMPENSATION PLAN. To the
extent practicable under applicable law and deemed appropriate by the
Compensation Committee, the Company shall provide to the Executive an
opportunity to participate in a Company sponsored deferred compensation plan.

(d)           OTHER
BENEFITS.

(i)            ANNUAL PHYSICAL.  The Company shall provide, at its cost, a
medical examination for the Executive on an annual basis by a licensed
physician in the Philadelphia, Pennsylvania area selected by the Executive. The
results of such examination are the sole property of such Executive and shall
be treated in confidence.

(ii)           CAR ALLOWANCE.  The Company shall pay Executive a monthly car
allowance of $650 in advance of the month to which the payment relates.

(iii)          TAX PREPARATION AND FINANCIAL
PLANNING.  The Company shall pay or
promptly reimburse the Executive for costs incurred by him in connection with
tax preparation and financial planning assistance, to be furnished by such
advisors as chosen by the Executive, up to a maximum aggregate of $5,000
annually.

(iv)          DIRECTORS AND OFFICERS INSURANCE.  During the Term and the Severance Period, the
Executive shall be entitled to director and officer insurance coverage for his
acts and omissions while an officer and director of the Company to the extent
applicable, on a basis no less favorable to him than the coverage provided to
any other current officers and trustees. 
The provision of such insurance coverage will be at the sole cost of the
Company or the Partnership and the amount of coverage provided shall be
determined by the Company and/or the Board, in its or their sole discretion.

 

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(v)           DISABILITY INSURANCE.  The Company shall maintain, at its cost,
supplemental renewable long-term disability insurance as agreed to by the
Company and the Executive.

7.             TERMINATION.
The employment of the Executive by the Company pursuant to this Agreement shall
terminate upon the occurrence of any of the following:

(a)           DEATH
OR PERMANENT DISABILITY. Immediately upon death or Permanent Disability of the
Executive. As used in this Agreement, “Permanent Disability” shall mean an
inability due to a physical or mental impairment to perform the material
services contemplated under this Agreement for a period of six (6) months,
whether or not consecutive, during any 365-day period. A determination of
Permanent Disability shall be made by a physician satisfactory to both the
Executive and the Company, provided that if the Executive and the Company do
not agree on a physician, the Executive and the Company shall each select a physician
and these two together shall select a third physician, whose determination as
to Permanent Disability shall be binding on all parties, with the Company to
bear all cost of securing such determination. 
The appointment of one or more individuals to carry out the offices or
duties of the Executive during a period of the Executive’s inability to perform
such duties and pending a determination of Permanent Disability shall not be
considered a breach of this Agreement by the Company.

(b)           FOR
CAUSE. At the election of the Company and subject to the provisions of this
Section 7(b), immediately upon written notice by the Company to the Executive
of his termination for Cause. For purposes of this Agreement, “Cause” for
termination shall be deemed to exist solely in the event of (i) the conviction
of the Executive of, or the entry of a plea of guilty or nolo
contendere by the Executive to, a felony (exclusive of any felony
relating to negligent operation of a motor vehicle and not including a
conviction, plea of guilty or nolo contendere
arising solely under a statutory provision imposing criminal liability upon the
Executive on a per se basis due to the Company offices held by the Executive,
so long as any act or omission of the Executive with respect to such matter was
not taken or omitted in contravention of any applicable policy or directive of
the Board), (ii) a willful breach of his duty of loyalty which is materially
detrimental to the Company, or (iii) a willful failure to perform or adhere to
explicitly stated duties that are consistent with the terms of this Agreement,
or the Company’s reasonable and customary guidelines of employment or
reasonable and customary corporate governance guidelines or policies, including
without limitation any business code of ethics adopted by the Board, or to
follow the lawful directives of the Board (provided such directives are
consistent with the terms of this Agreement), which, in any such case,
continues for thirty (30) days after written notice from the Board to the Executive.  For purposes of this Section 7(b), no act, or
failure to act, on the Executive’s part will be deemed “willful” unless done,
or omitted to be done, by the Executive not in good faith and without a
reasonable belief that the Executive’s act, or failure to act, was in the best
interest of the Company.  The parties
agree that in order to terminate the Executive pursuant to Subsections (ii) and
(iii) hereof, the Company shall first be required to prove to the reasonable
satisfaction of the Executive that he engaged in improper conduct under these
Subsections, and if the Executive shall not agree with the Company’s assessment
of his conduct, then the Executive shall not be terminated until an arbitrator,
as provided for in Section 13(b), has determined that the Executive’s conduct
constituted improper conduct under the applicable Subsection.

 

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(c)           WITHOUT
CAUSE; WITHOUT GOOD REASON.  At the
election of the Company, without Cause, and at the election of the Executive,
without Good Reason, in either case upon thirty (30) days prior written notice
to the Executive or the Company, as the case may be.

(d)           FOR
GOOD REASON.  At the election of the
Executive, for Good Reason. For purposes of this Agreement, “Good Reason” shall
mean any of the following actions or omissions occurring without the Executive’s
written consent, provided the Executive notifies the Company of his
determination that Good Reason exists, with such notification to occur within
60 days of the time at which the Executive knows or should know of the action
or omission on which such determination is based:

(i)            failure by the Company to renew this
Agreement on substantially similar terms at the conclusion of the Initial Term
or of either Successor Term,

(ii)           a material reduction of the Executive’s
duties, responsibilities or reporting requirements, or the assignment to the
Executive of any duties, responsibilities, or reporting requirements that are
inconsistent with his positions as Executive Vice President and Chief Financial
Officer, as the case may be,

(iii)          a reduction by the Company in the
Executive’s annual Base Salary,

(iv)           a material reduction or loss of
employee benefits or material fringe benefits, both in terms of the amount of
the benefit and the level of the Executive’s participation therein, enjoyed by
the Executive under the employee benefit and welfare plans of the Company,
including without limitation such benefits as group health, dental, 401(k),
accident, disability insurance, or group life insurance, that is caused by the
Company except as is required by applicable law,

(v)           absent the Executive’s prior written
consent, the requirement by the Company that the principal place of business at
which the Executive performs his duties be changed to a location that is
outside of a 35 mile radius of Newtown Square, Pennsylvania.

(vi)          a material breach by the Company of
any provision of this Agreement that continues for a period of thirty (30) days
after Executive provides written notice to the Company of such breach.

8.             EFFECTS
OF TERMINATION.

(a)           BY
THE COMPANY WITHOUT CAUSE; BY THE EXECUTIVE FOR GOOD REASON.  In the event of a termination of the
Executive’s employment by the Company without Cause or by the Executive for
Good Reason, then the Company shall pay the Executive as follows:

(i)            an amount equal to two (2) times (and
two (2) times if, in connection with a Change of Control, either the Executive
terminates employment with the Company for Good Reason or the Company
terminates the Executive without Cause), the Executive’s Base Salary and Annual
Incentive Bonus (determined at the Superior Level for both 

 

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compensation and individual performance for the year in
which the termination of employment occurs) (the “Applicable Amount”),
provided, however, that in the event of a resignation by the Executive for Good
Reason pursuant to Section 7(d)(i) after notice of non-renewal of this
Agreement by the Company with respect to the second Successor Term, the
multiplier shall be limited to one (1) times the Applicable Amount, and

 

(ii)           the prorated amount of the Annual
Incentive Bonus at the Superior Level for both corporate and individual
performance for the year in which the termination of employment occurs), pro
rated for the portion of such year during which the Executive was employed
prior to the effective date of his termination, and

(iii)          an amount equal to accrued but unpaid
Base Salary through the date of termination plus any other compensation then
due and owing from the Company.

(iv)           The sum of the amounts payable under
subsections (i), (ii) and (iii) hereof is referred to herein as his “Severance
Payment.”

(v)           The Severance Payment shall be made
in a single, lump sum cash payment no later than thirty (30) days after the
effective date of the Executive’s termination of employment.

(vi)          The Company shall allow the Executive to continue to
participate during the two-year period commencing on the date of termination
(the “Severance Period”) in any healthcare, dental, vision and prescription
drug plans in which the Executive was entitled to participate immediately prior
to his termination, to the same extent and upon the same terms as the Executive
participated in such plans prior to his termination, provided that the
Executive’s continued participation is permissible or otherwise practicable
under the general terms and provisions of such benefit plans and programs.  During the Severance Period, the Company
shall pay for the Executive’s continued participation in said healthcare,
dental, vision and prescription drug plans, including but not limited to
premiums for such programs.  To the
extent that continued participation is neither permissible nor practicable, the
Company shall take such actions as may be necessary to provide the Executive
with substantially comparable benefits (without additional cost to the
Executive) outside the scope of such plans, including, without limitation,
reimbursing the Executive for his costs in obtaining such coverage, such as
COBRA premiums paid by the Executive and/or his eligible dependents. If the
Executive engages in regular employment after his termination of employment
(whether as an executive or as a self-employed person), any employee
benefit and welfare benefits received by the Executive in consideration of such
employment which are similar in nature to the healthcare, dental, vision and
prescription drug plans provided by the Company will relieve the Company of its
obligation under this Section 8(a)(vi) to provide comparable benefits to the
extent of the benefits so received.

(vii)         The Executive’s stock options, if any,
awarded under the Equity Incentive Plan (or any other or successor plan) shall
immediately become 100% vested and he shall have at least a two-year period following the effective
date of his termination of employment in which to exercise his vested stock
options, including those stock options that vested upon his termination of
employment.

 

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(viii)        The Executive’s restricted Common Shares
awarded under the Equity Incentive Plan (or any other or successor plan),
including without limitation the Restricted Share Grants, shall immediately
become 100% vested and all restrictions shall lapse.

(b)           TERMINATION
ON DEATH OR PERMANENT DISABILITY.  Upon a
termination of employment due to the Executive’s death or his becoming subject
to Permanent Disability, the Company shall pay the Executive (or his estate or
beneficiary) an amount equal to one (1) time the sum of the Executive’s Base
Salary and Annual Incentive Bonus (determined at the Superior Level for both
corporate and individual performance for the year in which the termination of
employment occurs), payable within thirty (30) days of the occurrence of the
relevant event.  The Executive shall
become 100% vested in his stock options and restricted Common Shares awarded
under the Equity Incentive Plan.  The
Executive (or his estate or beneficiary) shall have a one-year period following
the occurrence of the relevant event in which to exercise his vested stock
options, including those stock options that vested on such event.  The Company shall pay to the Executive (or
his estate or beneficiary) any Base Salary, Incentive Bonus, expense
reimbursements and all other compensation related payments that are payable as
of the date of the occurrence of the relevant event and that are related to his
period of employment preceding such date. 
The Company shall pay to the Executive (or his estate or beneficiary)
the prorated amount of Incentive Bonus at the Target Level for both corporate
and individual performance for the year in which such event occurs, prorated
for the portion of the year during which the Executive was employed prior to
the occurrence of the relevant event.

(c)           BY
THE COMPANY FOR CAUSE OR BY THE EXECUTIVE WITHOUT GOOD REASON.  In the event that the Executive’s employment
is terminated by the Company for Cause or by the Executive without Good Reason,
the Company shall pay the Executive his accrued Base Salary and, with respect
to a termination by the Executive without Good Reason, any amount of Annual
Incentive Bonus fully earned and payable through the date of termination and
payable under the applicable Incentive Bonus policy, expense reimbursements and
all other compensation related payments that are payable as of his termination
of employment date and that are related to his period of employment preceding
his termination date.  The Executive
shall be entitled to exercise his vested stock options, determined as of his
termination date, pursuant to the terms of the option grant.  Unless the Company and the Executive agree
otherwise, the Executive shall forfeit all unvested options and any unvested
Restricted Share Grants not acquired by the Executive for consideration,
subject to Section 9(b) below, and the Company has the right to repurchase any
unvested Restricted Share Grants that the Executive acquired for consideration
in accordance with the terms of the Equity Incentive Plan (with the result that
if the Executive acquired such unvested Restricted Share Grants for any
consideration, the Executive shall at most be entitled to a return of such
consideration).  The Executive shall also
be entitled to all benefits accrued and vested under any employee benefit plan
of the Company.

(d)           TERMINATION
OF AUTHORITY. Immediately upon the Executive terminating or being terminated
from his employment with the Company for any reason, notwithstanding anything
else appearing in this Agreement or otherwise, the Executive will stop serving
the functions of his terminated or expired positions, and shall be without any
of the authority or responsibility for such positions. On request of the Board,
at any time following his termination of employment for any reason, the Executive
shall resign from the Board if then a 

 

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member. 
Notwithstanding any contrary provision in this Agreement, the Company
shall continue to indemnify the Executive and hold the Executive harmless to
the extent specified under the by-laws or other corporate documents of the
Company or the Partnership (as applicable) and permitted by applicable law.

 

9.             CHANGE
OF CONTROL.

(a)           CHANGE
OF CONTROL. For purposes of this Agreement, a “Change of Control” will be deemed
to have taken place upon the occurrence of any of the following events:

(i)            the acquisition by any person,
entity or affiliated group, excluding Gary M. Holloway or any entity controlled
or member/partner managed directly or indirectly by Gary M. Holloway, the
Company or any employee benefit plan of the Company or any entity controlled
directly or indirectly by the Company, of more than 50% of the then outstanding
voting shares of the Company,

(ii)           the consummation of any merger or
consolidation of the Company into another company (unless such company is
controlled or member/partner managed directly or indirectly by Gary M.
Holloway), such that the holders of the voting shares of the Company
immediately prior to such merger or consolidation hold less than 50% of the
voting power of the securities of the surviving company or the parent of such
surviving company,

(iii)          the complete liquidation of the
Company or the sale or disposition of all or substantially all of the Company’s
assets, such that after the transaction, the holders of the voting shares of
the Company immediately prior to the transaction hold less than 50% of the
voting securities of the acquiror or the parent of the acquiror (unless the
acquiror or parent of the acquiror is Gary M. Holloway or an entity controlled
or member/partner managed directly or indirectly by Gary M. Holloway), or

(iv)          Trustees of
the Company are elected such that a majority of the members of the Board shall
have been members of the Board for less than two years, unless the election or
nomination for election of each new trustee who was not a trustee at the
beginning of such two-year period was approved by a vote of at least
two-thirds of the trustees then still in office who were trustees at the
beginning of such period, or

(v)           a majority of the Board of the
Company votes in favor of a decision that a Change of Control has occurred.

(b)           CERTAIN
BENEFITS UPON A CHANGE OF CONTROL.  In
the event of a termination of the Executive’s employment by the Executive or by
the Company (or its successor) for any reason other than Cause following a
Change of Control, the Executive shall become 100% vested in all unvested stock
options and restricted Common Shares awarded under the Equity Incentive Plan
(or any other or successor plan) and the Executive shall have a two (2) year period
following the termination of his employment in which to exercise his vested
stock options, including those stock options that vested upon the Change of
Control.

(c)           EXCISE TAX.  In the event that any payment or benefit received or
to be received by the Executive in connection with a change in control or a
termination of the 

 

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Executive’s employment (whether pursuant to the terms of this Agreement
or any other plan, arrangement or agreement with the Company, any person whose actions result in a change in
control or any person affiliated with the Company or such person), is in an
amount such that the Executive will be subject (in whole or in part) to the
excise tax imposed under Section 4999 of the Internal Revenue Code of 1986, as
amended (“Excise Tax”) on such payments and benefits, the Executive
acknowledges and agrees that the Company shall not be responsible to pay to the
Executive any increase in any such payment or benefit to offset the Excise Tax.

 

10.          CONFIDENTIAL
INFORMATION. The Executive recognizes and acknowledges that certain assets of
the Company constitute Confidential Information. The term “Confidential
Information” as used in this Agreement shall mean all information which is
known only to the Executive or the Company, other employees of the Company, or
others in a confidential relationship with the Company, and relating to the
Company’s business including, without limitation, information regarding
clients, customers, pricing policies, methods of operation, proprietary Company
programs, sales products, profits, costs, markets, key personnel, formulae,
product applications, technical processes, and trade secrets, as such
information may exist from time to time, which the Executive acquired or
obtained by virtue of work performed for the Company, or which the Executive
may acquire or may have acquired knowledge of during the performance of said
work. The Executive shall not, during the Term or for a two (2) year period
after the Term, disclose all or any part of the Confidential Information to any
person, firm, corporation, association, or any other entity for any reason or
purpose whatsoever, directly or indirectly, except as may be required by law or
pursuant to his employment hereunder, unless and until such Confidential
Information becomes publicly available other than as a consequence of the
breach by the Executive of his confidentiality obligations hereunder by law or
in any judicial or administrative proceeding (in which case, the Executive
shall provide the Company with notice). In the event of the termination of his
employment, whether voluntary or involuntary and whether by the Company or the
Executive, the Executive shall deliver to the Company all documents and data
pertaining to the Confidential Information and shall not take with him any
documents or data of any kind or any reproductions (in whole or in part) or
extracts of any items relating to the Confidential Information. The Company acknowledges
that prior to his employment with the Company, the Executive has lawfully
acquired extensive knowledge of the industries and businesses in which the
Company engages in business, and that the provisions of this Section 10 are not
intended to restrict the Executive’s use of such previously acquired knowledge.

In the event that the Executive
receives a request or is required (by deposition, interrogatory, request for
documents, subpoena, civil investigative demand or similar process) to disclose
all or any part of the Confidential Information, the Executive agrees to (a)
promptly notify the Company in writing of the existence, terms and
circumstances surrounding such request or requirement, (b) consult with the
Company on the advisability of taking legally available steps to resist or
narrow such request or requirement, and (c) assist the Company in seeking a
protective order or other appropriate remedy. In the event that such protective
order or other remedy is not obtained or that the Company waives compliance
with the provisions hereof, the Executive shall not be liable for such
disclosure unless disclosure to any such tribunal was caused by or resulted
from a previous disclosure by the Executive not permitted by this Agreement.

 

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11.          NON-COMPETITION
AND NONSOLICITATION. During the Term and for a period of 24 calendar months
after the termination of the Executive’s employment (the “Noncompete Period”),
the Executive shall not, directly or indirectly, either as a principal, agent,
employee, employer, stockholder, partner, member, director, trustee or in any
other capacity whatsoever: (a) engage or assist others engaged, in whole or in
part, in any business which is engaged in a business or enterprise that is
substantially similar to any primary segment of the business of the Company
that the Company was engaged in during the period of the Executive’s employment
with the Company, or (b) without the prior consent of the Board, employ or
solicit the employment of, or assist others in employing or soliciting the
employment of, any individual employed by the Company (other than the Executive’s
personal assistant or Executive’s secretary) at any time during the six (6)
month period prior to any termination of the Executive’s employment with the
Company; provided, however, that the provisions of this Section
11 shall not apply in the event the Company materially breaches this Agreement.

Further, nothing in this Section 11
shall prohibit (a) Executive from making any investment in a public company, or
where he is the owner of five percent (5%) or less of the issued and
outstanding voting securities of any entity, provided such ownership does not
result in his being obligated or required to devote any substantial amount of
managerial efforts; or (b) Executive from being engaged in activities permitted
under Section 1(c).

The Executive agrees that the
restraints imposed upon him pursuant to this Section 11 are necessary for the
reasonable and proper protection of the Company and its subsidiaries and
affiliates, and that each and every one of the restraints is reasonable in
respect to subject matter, length of time and geographic area. The parties
further agree that, in the event that any provision of this Section 11 shall be
determined by any court of competent jurisdiction to be unenforceable by reason
of its being extended over too great a time, too large a geographic area or too
great a range of activities, such provision shall be deemed to be modified to
permit its enforcement to the maximum extent permitted by law.

12.          INTELLECTUAL
PROPERTY. During the Term, the Executive shall promptly disclose to the Company
or any successor or assign, and grant to the Company and its successors and
assigns without any separate remuneration or compensation other than that
received by him in the course of his employment, his entire right, title and
interest in and to any and all inventions, developments, discoveries, models,
or any other intellectual property of any type or nature whatsoever (“Intellectual
Property”), whether developed by him during or after business hours, or alone
or in connection with others, that is in any way related to the business of the
Company, its successors or assigns. This provision shall not apply to (a) any
Intellectual Property developed by the Executive prior to the Term; and (b)
books or articles authored by the Executive during non-work hours,
consistent with his obligations under this Agreement, so long as such books or
articles (i) are not funded in whole or in part by the Company, and (ii) do not
contain any Confidential Information or Intellectual Property of the Company.
The Executive agrees, at the Company’s expense, to take all steps necessary or
proper to vest title to all such Intellectual Property in the Company, and
cooperate fully and assist the Company in any litigation or other proceedings
involving any such Intellectual Property.

 

11

 

13.          DISPUTES.

(a)           EQUITABLE
RELIEF. The Executive acknowledges and agrees that upon any breach by the
Executive of his obligations under Sections 10, 11, or 12 hereof, the Company
will have no adequate remedy at law, and accordingly will be entitled to
specific performance and other appropriate injunctive and equitable relief.

(b)           ARBITRATION.
Excluding only requests for equitable relief by the Company under Section
13(a), in the event that there is any claim or dispute arising out of or
relating to this Agreement or the breach hereof, and the parties hereto shall
not have resolved such claim or dispute within 60 days after written notice
from one party to the other setting forth the nature of such claim or dispute,
then such claim or dispute shall be settled exclusively by binding arbitration
in Montgomery County, Pennsylvania, in accordance with the Employment Dispute
Resolution Rules of the American Arbitration Association (“Rules”), by an
arbitrator mutually agreed upon by the parties hereto or, in the absence of
such agreement, by an arbitrator selected according to such Rules.
Notwithstanding the foregoing, if either the Company or the Executive shall
request, such arbitration shall be conducted by a panel of three (3)
arbitrators, one selected by the Company, one selected by the Executive and the
third selected by agreement of the first two arbitrators, or, in the absence of
such agreement, in accordance with such Rules. 
Judgment upon the award rendered by such arbitrator(s) shall be entered
in any Court having jurisdiction thereof upon the application of either
party.  The parties agree to use their
reasonable best efforts to have such arbitration completed as soon as is
reasonably practicable.  Notwithstanding
anything herein to the contrary, except as provided in (c) below, each party
shall bear its own costs and expenses incurred in connection with the
arbitration.

(c)           LEGAL
FEES. The Company shall pay or promptly reimburse the Executive for the
reasonable legal fees and expenses incurred by the Executive in successfully
enforcing or defending any right of the Executive pursuant to this Agreement even
if the Executive prevails on one or more, but not all, of such issues.

14.          INDEMNIFICATION.
The Company shall indemnify the Executive, to the maximum extent permitted by
applicable law, against all costs, charges and expenses incurred or sustained
by the Executive, including the cost of legal counsel selected and retained by
the Executive in connection with any action, suit or proceeding to which the
Executive may be made a party by reason of the Executive being or having been
an officer, director, trustee, or employee of the Company or the Partnership.

15.          COOPERATION
IN FUTURE MATTERS. The Executive hereby agrees that for a period of 18 months
following his termination of employment he shall cooperate with the Company’s
reasonable requests relating to matters that pertain to the Executive’s
employment by the Company, including, without limitation, providing information
or limited consultation as to such matters, participating in legal proceedings,
investigations or audits on behalf of the Company, or otherwise making himself
reasonably available to the Company for other related purposes. Any such
cooperation shall be performed at scheduled times taking into consideration the
Executive’s other commitments, and the Executive shall be compensated at a
reasonable hourly or per diem rate (based on the Executive’s Base Salary as of
his termination date).  The Executive
shall not be required to perform such cooperation to the extent it conflicts
with any 

 

12

 

requirements of exclusivity of services for another
employer or otherwise, nor in any manner that in the good faith belief of the
Executive would conflict with his rights under or ability to enforce this
Agreement.

 

16.          GENERAL.

(a)           NOTICES.
All notices and other communications hereunder shall be in writing or by
written telecommunication, and shall be deemed to have been duly given if
delivered personally or if sent by overnight courier, to the relevant address
set forth below or to such other address as the recipient of such notice or
communication shall have specified in writing to the other party hereto, in
accordance with this Section 16(a).

 

	
  If to the Company, to:

  	
   

  	
  GMH
  Communities Trust

  
	
   

  	
   

  	
  10
  Campus Boulevard

  
	
   

  	
   

  	
  Newtown
  Square, PA 19073

  
	
   

  	
   

  	
  Attn:
  Board of Trustees

  
	
   

  	
   

  	
   

  
	
  With a
  Mandatory copy to:

  	
   

  	
  GMH
  Communities Trust

  
	
   

  	
   

  	
  10
  Campus Boulevard

  
	
   

  	
   

  	
  Newtown
  Square, PA 19073

  
	
   

  	
   

  	
  Attn:
  General Counsel

  

 

                If
to Executive, at his last residence shown on the records of the Company.

 

Any
such notice shall be effective (i) if delivered personally, when received, and
(ii) if sent by overnight courier, when receipted for, provided a copy of such
communication is sent, as described above.

(b)           SEVERABILITY.
If any provision of this Agreement is or becomes invalid, illegal or
unenforceable in any respect under any law, the validity, legality and
enforceability of the remaining provisions hereof shall not in any way be
affected or impaired.

(c)           WAIVERS.
No delay or omission by either party hereto in exercising any right, power or
privilege hereunder shall impair such right, power or privilege, nor shall any
single or partial exercise of any such right, power or privilege preclude any
further exercise thereof or the exercise of any other right, power or
privilege.

(d)           COUNTERPARTS.
This Agreement may be executed in multiple counterparts, each of which shall be
deemed an original, but all of which together shall constitute one and the same
instrument. In making proof of this Agreement, it shall not be necessary to
produce or account for more than one such counterpart.

(e)           ASSIGNS.
This Agreement shall be binding upon and inure to the benefit of the Company’s
successors and the Executive’s personal or legal representatives, executors,
administrators, heirs, distributees, devisees and legatees. This Agreement
shall not be assignable by the Executive, it being understood and agreed that
this is a contract for the Executive’s 

 

13

 

personal services. 
This Agreement shall not be assignable by the Company except that the
Company shall assign it in connection with a transaction involving the
succession by a third party to all or substantially all of the Company’s
business and/or assets (whether direct or indirect and whether by purchase,
merger, consolidation, liquidation or otherwise).  When assigned to a successor, the assignee
shall assume this Agreement and expressly agree to perform this Agreement in
the same manner and to the same extent as the Company would be required to
perform it in the absence of such an assignment. For all purposes under this
Agreement, the term “Company” shall include any successor to the Company’s
business and/or assets that executes and delivers the assumption agreement described
in the immediately preceding sentence or that becomes bound by this Agreement
by operation of law.

 

(f)            ENTIRE
AGREEMENT. This Agreement contains the entire understanding of the parties,
supersedes all prior agreements and understandings, whether written or oral,
relating to the subject matter hereof and may not be amended except by a
written instrument hereafter signed by the Executive and a duly authorized
representative of the Board (other than the Executive).

(g)           GOVERNING
LAW. This Agreement and the performance hereof shall be construed and governed
in accordance with the laws of the Commonwealth of Pennsylvania, without giving
effect to principles of conflicts of law.

(h)           CONSTRUCTION.
The language used in this Agreement shall be deemed to be the language chosen
by the parties to express their mutual intent, and no rule of strict
construction shall be applied against any party. The headings of sections of
this Agreement are for convenience of reference only and shall not affect its
meaning or construction.  Whenever any
word is used herein in one gender, it shall be construed to include the other
gender, and any word used in the singular shall be construed to include the
plural in any case in which it would apply and vice versa.

(i)            PAYMENTS
AND EXERCISE OF RIGHTS AFTER DEATH. Any amounts payable hereunder after the
Executive’s death shall be paid to the Executive’s designated beneficiary or
beneficiaries, whether received as a designated beneficiary or by will or the
laws of descent and distribution. The Executive may designate a beneficiary or
beneficiaries for all purposes of this Agreement, and may change at any time
such designation, by notice to the Company making specific reference to this
Agreement. If no designated beneficiary survives the Executive or the Executive
fails to designate a beneficiary for purposes of this Agreement prior to his
death, all amounts thereafter due hereunder shall be paid, as and when payable,
to his spouse, if she survives the Executive, and otherwise to his estate.

(j)            CONSULTATION
WITH COUNSEL. The Executive acknowledges that he has had a full and complete
opportunity to consult with counsel or other advisers of his own choosing
concerning the terms, enforceability and implications of this Agreement, and
that the Company has not made any representations or warranties to the
Executive concerning the terms, enforceability and implications of this
Agreement other than as are reflected in this Agreement.  The Company will pay the reasonable legal
fees and expenses incurred in the drafting and negotiation of this Agreement.

 

14

 

(k)           WITHHOLDING.
Any payments provided for in this Agreement shall be paid net of any applicable
income tax withholding required under federal, state or local law.

(l)    CONSUMER PRICE INDEX.  For purposes of this Agreement, the term “CPI”
refers to the Consumer Price Index as published by the Bureau of Labor
Statistics of the United States Department of Labor, U.S. City Average, All
Items for Urban Wage Earners and Clerical Workers (1982-1984=100).  If the CPI is hereafter converted to a
different standard reference base or otherwise revised, the determination of
the CPI adjustment shall be made with the use of such conversion factor,
formula or table for converting the CPI, as may be published by the Bureau of
Labor Statistics, or, if the bureau shall no longer publish the same, then with
the use of such conversion factor, formula or table as may be published by an
agency of the United States, or failing such publication, by a nationally
recognized publisher of similar statistical information.

(m)                          SURVIVAL.  The provisions of Sections 6(d)(iv), 8, 9,
10, 11, 12, 13, 14, 15 and 16 shall survive the termination of this Agreement.

 

15

 

                IN
WITNESS WHEREOF, and intending to be legally bound hereby, the parties hereto
have caused this Agreement to be duly executed as of the date first above
written.

 

GMH
COMMUNITIES TRUST

 

	
  By: /s/ Gary M. Holloway

  	
  /s/ J. Patrick
  O’Grady

  
	
  Name:
  Gary M. Holloway

  	
  J. PATRICK O’GRADY

  
	
  Its:
  Chairman, CEO and President

  	
   

  
	
   

  	
   

  
	
  Dated: July 6, 2006

  	
  Dated:  July 6, 2006

  

 

 

16EXHIBIT
10.26

 

PENNSYLVANIA

 

 

PENNSYLVANIA

FULL SERVICE LEASE

 

 

353
ASSOCIATES

 

Landlord

 

and

 

GMH
MILITARY HOUSING, LLC

 

Tenant

 

 

10 Campus Boulevard

Newtown Square, PA 19073

 

 

TABLE OF CONTENTS

 

	
  1.

  	
   

  	
  SUMMARY OF DEFINED TERMS.

  	
  1

  
	
   

  	
   

  	
   

  	
   

  
	
  2.

  	
   

  	
  PREMISES.

  	
  2

  
	
   

  	
   

  	
   

  	
   

  
	
  3.

  	
   

  	
  TERM.

  	
  2

  
	
   

  	
   

  	
   

  	
   

  
	
  4.

  	
   

  	
  CONSTRUCTION BY LANDLORD.

  	
  2

  
	
   

  	
   

  	
   

  	
   

  
	
  5.

  	
   

  	
  FIXED RENT; SECURITY DEPOSIT.

  	
  2

  
	
   

  	
   

  	
   

  	
   

  
	
  6.

  	
   

  	
  INTENTIONALLY OMITTED.

  	
  3

  
	
   

  	
   

  	
   

  	
   

  
	
  7.

  	
   

  	
  ELECTRICITY, TELEPHONE &
  INTERNET CHARGES.

  	
  3

  
	
   

  	
   

  	
   

  	
   

  
	
  8.

  	
   

  	
  SIGNS;
  USE OF PREMISES AND COMMON AREAS.

  	
  3

  
	
   

  	
   

  	
   

  	
   

  
	
  9.

  	
   

  	
  ENVIRONMENTAL MATTERS.

  	
  4

  
	
   

  	
   

  	
   

  	
   

  
	
  10.

  	
   

  	
  TENANT’S ALTERATIONS.

  	
  5

  
	
   

  	
   

  	
   

  	
   

  
	
  11.

  	
   

  	
  CONSTRUCTION LIENS.

  	
  6

  
	
   

  	
   

  	
   

  	
   

  
	
  12.

  	
   

  	
  ASSIGNMENT AND SUBLETTING.

  	
  6

  
	
   

  	
   

  	
   

  	
   

  
	
  13.

  	
   

  	
  LANDLORD’S RIGHT OF ENTRY.

  	
  8

  
	
   

  	
   

  	
   

  	
   

  
	
  14.

  	
   

  	
  REPAIRS AND MAINTENANCE.

  	
  9

  
	
   

  	
   

  	
   

  	
   

  
	
  15.

  	
   

  	
  INSURANCE; SUBROGATION RIGHTS.

  	
  9

  
	
   

  	
   

  	
   

  	
   

  
	
  16.

  	
   

  	
  INDEMNIFICATION.

  	
  10

  
	
   

  	
   

  	
   

  	
   

  
	
  17.

  	
   

  	
  QUIET ENJOYMENT.

  	
  11

  
	
   

  	
   

  	
   

  	
   

  
	
  18.

  	
   

  	
  FIRE DAMAGE.

  	
  11

  
	
   

  	
   

  	
   

  	
   

  
	
  19.

  	
   

  	
  SUBORDINATION; RIGHTS OF MORTGAGEE.

  	
  11

  
	
   

  	
   

  	
   

  	
   

  
	
  20.

  	
   

  	
  CONDEMNATION.

  	
  12

  
	
   

  	
   

  	
   

  	
   

  
	
  21.

  	
   

  	
  ESTOPPEL CERTIFICATE.

  	
  13

  
	
   

  	
   

  	
   

  	
   

  
	
  22.

  	
   

  	
  DEFAULT.

  	
  13

  
	
   

  	
   

  	
   

  	
   

  
	
  23.

  	
   

  	
  LANDLORD’S LIEN.

  	
  18

  
	
   

  	
   

  	
   

  	
   

  
	
  24.

  	
   

  	
  LANDLORD’S REPRESENTATIONS AND
  WARRANTIES.

  	
  18

  

 

i

 

	
  25.

  	
   

  	
  SURRENDER.

  	
  18

  
	
   

  	
   

  	
   

  	
   

  
	
  26.

  	
   

  	
  RULES AND REGULATIONS.

  	
  19

  
	
   

  	
   

  	
   

  	
   

  
	
  27.

  	
   

  	
  GOVERNMENTAL REGULATIONS.

  	
  19

  
	
   

  	
   

  	
   

  	
   

  
	
  28.

  	
   

  	
  NOTICES.

  	
  20

  
	
   

  	
   

  	
   

  	
   

  
	
  29.

  	
   

  	
  BROKERS.

  	
  20

  
	
   

  	
   

  	
   

  	
   

  
	
  30.

  	
   

  	
  CHANGE OF BUILDING/PROJECT NAME.

  	
  20

  
	
   

  	
   

  	
   

  	
   

  
	
  31.

  	
   

  	
  LANDLORD’S LIABILITY.

  	
  20

  
	
   

  	
   

  	
   

  	
   

  
	
  32.

  	
   

  	
  AUTHORITY.

  	
  20

  
	
   

  	
   

  	
   

  	
   

  
	
  33.

  	
   

  	
  NO OFFER.

  	
  20

  
	
   

  	
   

  	
   

  	
   

  
	
  34.

  	
   

  	
  RENEWAL.

  	
  21

  
	
   

  	
   

  	
   

  	
   

  
	
  35.

  	
   

  	
  INTENTIONALLY OMITTED.

  	
  21

  
	
   

  	
   

  	
   

  	
   

  
	
  36.

  	
   

  	
  TENANT FINANCIAL INFORMATION.

  	
  21

  
	
   

  	
   

  	
   

  	
   

  
	
  37.

  	
   

  	
  MISCELLANEOUS PROVISIONS.

  	
  22

  
	
   

  	
   

  	
   

  	
   

  
	
  38.

  	
   

  	
  WAIVER OF TRIAL BY JURY.

  	
  23

  
	
   

  	
   

  	
   

  	
   

  
	
  39.

  	
   

  	
  CONSENT TO JURISDICTION.

  	
  24

  

 

ii

 

LEASE

 

THIS LEASE (“Lease”) is entered into as of the 2nd day
of November, 2004, between 353 ASSOCIATES, a Pennsylvania limited partnership (“Landlord”), and GMH MILITARY
HOUSING, LLC, a Delaware limited liability company (“Tenant”).

 

WITNESSETH

 

In consideration of the mutual covenants herein set
forth, and intending to be legally bound, the parties hereto covenant and agree
as follows:

 

1.             SUMMARY OF DEFINED TERMS.

 

The following defined terms, as used in this Lease,
shall have the meanings and shall be construed as set forth below:

 

(a)           “Building”:  The Building located at 10 Campus Boulevard,
Newtown Square, Pennsylvania.

 

(b)           “Project”:  The Building, the land and all other
improvements located at 10 Campus Boulevard, Newtown Square, Pennsylvania.

 

(c)           “Premises”:  A portion of the Building which the parties
stipulate and agree is a 7,072 rentable square foot portion of the first floor
of the Building.

 

(d)           “Term”:  From the Commencement Date for a period of 60
months, ending on the last calendar day of the month.

 

(e)           “Fixed Rent”:

 

	
   

  	
   

  	
   

  	
   

  	
  MONTHLY

  	
   

  	
  ANNUAL

  	
   

  
	
  LEASE YEAR

  	
   

  	
  PER R.S.F.

  	
   

  	
  INSTALLMENTS

  	
   

  	
  FIXED RENT

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Months 1-60

  	
   

  	
  $

  	
  25.00

  	
   

  	
  $

  	
  14,733.33

  	
   

  	
  $

  	
  176,800.00

  	
   

  
											

 

(f)            “Security Deposit”:  $0.

 

(g)           Intentionally Omitted.

 

(h)           “Rentable Area”:
Premises   7,072 sq. ft.

 

(i)            “Permitted Uses”:  Tenant’s use of the Premises shall be limited
to general office use and storage incidental thereto. Tenant’s rights to use
the Premises shall be subject to all applicable laws and governmental rules and
regulations and to all reasonable requirements of the insurers of the Building.

 

(j)            “Tenant’s Broker”:  None

 

(k)           “Notice Address/Contact”

 

Tenant:                                                       GMH
MILITARY HOUSING, LLC

10 Campus Boulevard

Newtown Square, PA 19073

 

1

 

Attn: Joseph M. Macchione

Fax No.: 610-355-8480

E-Mail:
jmacchione@gmh-inc.com

 

Landlord:                                             353
ASSOCIATES

c/o GMH Communities, LP

10 Campus Boulevard

Newtown Square, PA 19073

Attn: Joseph M. Macchione

Fax No.: 610-355-8480

E-Mail:
jmacchione@gmh-inc.com

 

with a copy to:                 Morgan
Lewis & Bockius LLP

1701 Market Street

Philadelphia, PA 19103

Attn:  Richard
J. Sabat

Fax No.: 877-432-9652

E-Mail:
rsabat@morganlewis.com

 

(l)            “Tenant’s North American
Industry Classification Number”: 531210

 

(m)          “Additional Rent”: All sums of
money or charges required to be paid by Tenant under this Lease other than
Fixed Rent, whether or not such sums or charges are designated as “Additional
Rent”.

 

(n)           “Rent”: All Annual Fixed Rent,
monthly installments of Annual Fixed Rent, Fixed Rent and Additional Rent
payable by Tenant to Landlord under this Lease.

 

2.             PREMISES.

 

Landlord does hereby lease, demise and let unto Tenant
and Tenant does hereby hire and lease from Landlord the Premises for the Term,
upon the provisions, conditions and limitations set forth herein.

 

3.             TERM.

 

The Term of this Lease shall commence (the “Commencement
Date”) on November 2, 2004. The Term shall expire on November 1, 2009.

 

4.             CONSTRUCTION BY LANDLORD. Landlord
shall not perform any work to the Premises. Tenant shall accept the Premises in
as-is condition.

 

5.             FIXED RENT; SECURITY DEPOSIT.

 

(a)           Tenant
shall pay to Landlord without notice or demand, and without set-off, the annual
Fixed Rent payable in the monthly installments of Fixed Rent as set forth in Article
1(e), in advance on the first day of each calendar month during the Term by
check sent to Landlord at the address provided for in Section 1(k) of this
Lease. Notwithstanding the immediately preceding sentence, the first full month’s
installment and the Security Deposit shall be paid upon the execution of this
Lease by Tenant by two separate
checks.

 

(b)           In
the event any Fixed Rent or Additional Rent, charge, fee or other amount due
from Tenant under the terms of this Lease are not paid to Landlord when due,
Tenant shall also pay as Additional Rent a service and handling charge equal to
ten (10%) percent of the total payment then due. The aforesaid late fee shall
begin to accrue on the initial date of a payment due date, irrespective of any
grace period granted hereunder. This provision shall not prevent Landlord from
exercising any other remedy herein provided or otherwise available at law or in

 

2

 

equity in the event of
any default by Tenant.

 

(c)           Tenant shall be required to pay a
Security Deposit of $0 under this Lease.

 

6.             INTENTIONALLY OMITTED.

 

7.             ELECTRICITY, TELEPHONE AND INTERNET CHARGES.
Charges for normal electricity usage, phone, internet and cable services for
the Premises is included in the Fixed Rent. Landlord shall not be liable for
any interruption or delay in electric or any other utility service for any
reason unless caused by the gross negligence or willful misconduct of Landlord
or its agents. Landlord shall have the right to change the electric and other
utility providers to the Project or Building at any time. In the event Tenant
uses more electricity than the average office tenant occupying similar space,
as determined in Landlord’s sole, reasonable judgment, Landlord shall have the
right to bill Tenant for such additional costs as Additional Rent as Landlord
may determine in Landlord’s sole and reasonable judgment.

 

8.             SIGNS;
USE OF PREMISES AND COMMON AREAS.

 

(a)           Landlord shall provide Tenant with
standard identification signage on all Building directories. No other signs
shall be placed, erected or maintained by Tenant at any place upon the Premises,
Building or Project.

 

(b)           Tenant
may use and occupy the Premises only for the express and limited purposes
stated in Article 1(i) above; and the Premises shall not be used or
occupied, in whole or in part, for any other purpose without the prior written
consent of Landlord; provided that Tenant’s right to so use and occupy the
Premises shall remain expressly subject to the provisions of “Governmental
Regulations”, Article 28 herein. No machinery or equipment shall be
permitted that shall cause vibration, noise or disturbance beyond the Premises.
Tenant, without Landlord’s consent or direction, shall not “vacate” the
Premises at any time during the Term, nor permit the Premises to remain
unoccupied. “Vacate” shall be defined as Tenant’s ceasing to use the Premises
for its Permitted Use or the removal of substantially all of its furniture and
equipment and personal property from the Premises.

 

(c)           Tenant shall not overload any floor
or part thereof in the Premises or the Building, including any public corridors
or elevators therein, bringing in, placing, storing, installing or removing any
large or heavy articles, and Landlord may prohibit, or may direct and control
the location and size of, safes and all other heavy articles,  and may require, at Tenant’s sole cost and
expense, supplementary supports of such material and dimensions as Landlord may
deem necessary to properly distribute the weight.

 

(d)           Tenant
shall not install in or for the Premises, without Landlord’s prior written
approval, any equipment which requires more electric current than Landlord is
required to provide under this Lease, and Tenant shall ascertain from Landlord
the maximum amount of load or demand for or use of electrical current which can
safely be permitted in and for the Premises, taking into account the capacity
of electric wiring in the Building and the Premises and the needs of Building
common areas (interior and exterior) and the requirements of other tenants of
the Building, Tenant and shall not in any event connect a greater load than
such safe capacity.

 

(e)           Tenant shall not commit or suffer any
waste upon the Premises, Building or Project or any nuisance, or do any other
act or thing which may disturb the quiet enjoyment of any other tenant in the
Building or Project.

 

(f)            Tenant shall have the right,
non-exclusive and in common with others, to use the exterior paved driveways
and walkways of the Building for vehicular and pedestrian access to the
Building. Tenant shall also have the right, in common with other tenants of the
Building and Landlord, to use the designated parking areas of the Project for
the parking of automobiles of Tenant and its employees and business visitors,
incident to Tenant’s permitted use of the Premises; provided that Landlord
shall have the right to restrict or limit Tenant’s utilization of the parking
areas in the event the same become overburdened and in such case to equitably
allocate on proportionate basis or assign parking spaces among Tenant and the
other tenants of the Building.

 

3

 

9.             ENVIRONMENTAL MATTERS.

 

(a)           Hazardous Substances.

 

(i)            Tenant shall not, except as provided
in subparagraph (ii) below, bring or otherwise cause to be brought or permit
any of its agents, employees, contractors or invitees to bring in, on or about
any part of the Premises, Building or Project, any hazardous substance or
hazardous waste in violation of law, as such terms are or may be defined in (x)
the Comprehensive Environmental Response, Compensation and Liability Act, 42
U.S.C. 9601 et  seq., as the same may from time to time be
amended, and the regulations promulgated pursuant thereto (“CERCLA”); the
United States Department of Transportation Hazardous Materials Table (49 CFR
172.102); by the Environmental Protection Agency as hazardous substances (40
CFR Part 302); the Clean Air Act; and the Clean Water Act, and all amendments,
modifications or supplements thereto; and/or (y) any other rule, regulation,
ordinance, statute or requirements of any governmental or administrative agency
regarding the environment (collectively, (x) and (y) shall be referred to as
an  “Applicable Environmental Law”).

 

(ii)           Tenant may bring to and use at the
Premises hazardous substances incidental to its normal business operations under
the NAI Code referenced in article 1(m) above in the quantities reasonably
required for Tenant’s normal business consistent with its occupancy pursuant to
the Prior Leases and in accordance with Applicable Environmental Laws. Tenant
shall store and handle such substances in strict accordance with Applicable
Environmental Laws. From time to time promptly following a request to Landlord,
Tenant shall provide Landlord with documents identifying the hazardous
substances stored or used by Tenant on the Premises and describing the chemical
properties of such substances and such other information reasonably requested
by Landlord or Tenant. Prior to the expiration or sooner termination of this
Lease, Tenant shall remove all hazardous substances from the Premises and shall
provide Landlord with an inspection report from an independent environmental
engineer certifying that the Premises and the land surrounding the Premises are
free of contamination from hazardous substances and hazardous wastes. The
provisions of this paragraph shall be personal to Tenant and, in the event
Tenant ceases to occupy the Premises, Landlord’s approval to store and use
hazardous substances shall automatically terminate.

 

(iii)          Tenant shall defend, indemnify and
hold harmless Landlord and their respective affiliates, employees and agents
from and against any and all third-party claims, actions, damages, liability
and expense (including all attorney’s, consultant’s and expert’s fees, expenses
and liabilities incurred in defense of any such claim or any action or
proceeding brought thereon) arising from Tenant’s storage and use of hazardous
substances on the Premises including, without limitation, any and all costs
incurred by Landlord because of any investigation of the Project or any
cleanup, removal or restoration of the Project to remove or remediate
hazardous  or hazardous wastes deposited
by Tenant. Without limitation of the foregoing, if Tenant, its officers,
employees, agents, contractors, licensees or invitees cause contamination of
the Premises by any hazardous substances, Tenant shall promptly at its sole
expense, take any and all necessary actions to return the Premises to the
condition existing prior to such contamination, or in the alternative take such
other remedial steps as may be required by law or recommended by Landlord’s
environmental consultant.

 

(b)           NAI Numbers.

 

(i)            Tenant represents and warrants that
Tenant’s NAI number as designated in the North American Industry Classification
System Manual prepared by the Office of Management and Budget, and as set forth
in Article 1(l) hereof, is correct. Tenant represents that the specific
activities intended to be carried on in the Premises are in accordance with
Article 1(i).

 

(ii)           Except as provided in Article
9(a)(ii), Tenant shall not engage in operations at the Premises which involve
the generation, manufacture, refining, transportation, treatment, storage,
handling or disposal of “hazardous substances” or “hazardous waste” as such
terms are defined under any Applicable Environmental Law. Tenant further
covenants that it will not cause or permit to exist any “release” or “discharge”

 

4

 

(as such term is defined
under Applicable Environmental Laws) on or about the Premises.

 

(iii)          Tenant shall, at its expense, comply
with all requirements of Applicable Environmental Laws pertaining thereto.

 

(iv)          In addition, upon written notice of
Landlord, Tenant shall cooperate with Landlord in obtaining Applicable
Environmental Laws approval of any transfer of the Buildings. Specifically in
that regard, Tenant agrees that it shall (1) execute and deliver all
affidavits, reports, responses to questions, applications or other filings
required by Landlord and related to Tenant’s activities at the Premises, (2)
allow inspections and testing of the Premises during normal business hours, and
(3) as respects the Premises, perform any requirement reasonably required by
Landlord necessary for the receipt of approvals under Applicable Environmental
Laws, provided the foregoing shall be at no out-of-pocket cost or expense to
Tenant except for clean-up and remediation costs arising from Tenant’s
violation of this Article 9.

 

(c)           Additional Terms.

 

(i)            In the event of Tenant’s failure to
comply in full with this Article, Landlord may, after written notice to Tenant
and Tenant’s failure to cure within thirty (30) days of its receipt of such
notice, at Landlord’s option, perform any and all of Tenant’s obligations as
aforesaid and all costs and expenses incurred by Landlord in the exercise of
this right all be deemed to be Additional Rent payable on demand and with
interest at the Default Rate.

 

(ii)           The parties acknowledge and agree
that Tenant shall not be held responsible for any environmental issue at the
Premises unless such issue was caused by an action or omission of Tenant or its
agents, employees, consultants or invitees.

 

(d)           Survival.                This Article 9 shall survive the
expiration or sooner termination of this Lease.

 

10.           TENANT’S ALTERATIONS.

 

Tenant will not cut or drill into or secure any
fixture, apparatus or equipment or make alterations, improvements or physical
additions (collectively, “Alterations”) of any kind to any part of the Premises
without first obtaining the written consent of Landlord, such consent not to be
unreasonably withheld. Alterations shall, at Landlord’s option, be done by
Landlord at Tenant’s sole cost and expense. Landlord’s consent shall not be
required for (i) the installation of any office equipment including internal
partitions which do not require disturbance of any structural elements or
systems within the Building or (ii) minor work, including decorations, which
does not require disturbance of any structural elements or systems within the
Building and which costs in the aggregate less than $5,000. If no approval is
required or if Landlord approves Tenant’s Alterations and agrees to permit
Tenant’s contractors to do the work, Tenant, prior to the commencement of labor
or supply of any materials, must furnish to Landlord (i) a duplicate or
original policy or certificates of insurance evidencing (a) general public
liability insurance for personal injury and property damage in the minimum
amount of $3,000,000.00 combined single limit, (b) statutory workman’s
compensation insurance, and (c) employer’s liability insurance from each
contractor to be employed (all such policies shall be non-cancelable without
thirty (30) days prior written notice to Landlord and shall be in amounts and
with companies satisfactory to Landlord); (ii) construction documents prepared
and sealed by a registered Pennsylvania architect if such alteration causes the
aggregate of all Alterations to be in excess of $10,000; (iii) all applicable
building permits required by law; and (iv) an executed, effective Waiver of
Mechanics Liens from such contractors and all sub-contractors in states
allowing for such waivers or the cost of such alteration must be bonded by
Tenant. Any approval by Landlord permitting Tenant to do any or cause any work
to be done in or about the Premises shall be and hereby is conditioned upon
Tenant’s work being performed by workmen and mechanics working in harmony and
not interfering with labor employed by Landlord, Landlord’s mechanics or their
contractors or by any other tenant or their contractors. If at any time any of
the workmen or mechanics performing any of Tenant’s work shall be unable to
work in harmony or shall interfere with any labor employed by Landlord, other
tenants or their respective mechanics and contractors, then the permission granted
by Landlord to Tenant

 

5

 

permitting Tenant to do
or cause any work to be done in or about the Premises, may be withdrawn by
Landlord upon forty-eight (48) hours written notice to Tenant.

 

All Alterations (whether temporary or permanent in
character) made in or upon the Premises, either by Landlord or Tenant, shall be
Landlord’s property upon installation and shall remain on the Premises without
compensation to Tenant unless Landlord provides written notice to Tenant to
remove same at the expiration of the Lease, in which event Tenant shall
promptly remove such Alterations and restore the Premises to good order and
condition. At Lease termination, all furniture, movable trade fixtures and
equipment (including telephone, security and communication equipment system
wiring and cabling) shall, at Landlord’s option, be removed by Tenant and shall
be accomplished in a good and workmanlike manner so as not to damage the
Premises or Building and in such manner so as not to disturb other tenants in
the Building. All such installations, removals and restoration shall be
accomplished in a good and workmanlike manner so as not to damage the Premises
or Building and in such manner so as not to disturb other tenants in the
Building. If Tenant fails to remove any items required to be removed pursuant
to this Article, Landlord may do so and the reasonable costs and expenses
thereof shall be deemed Additional Rent hereunder and shall be reimbursed by
Tenant to Landlord within fifteen (15) business days of Tenant’s receipt of an
invoice therefor from Landlord.

 

11.           CONSTRUCTION LIENS.

 

(a)           Tenant will not suffer or permit any
contractor’s, subcontractor’s or supplier’s lien (a “Construction Lien”) to be
filed against the Premises or any part thereof by reason of work, labor
services or materials supplied or claimed to have been supplied to Tenant; and
if any Construction Lien shall at any time be filed against the Premises or any
part thereof, Tenant, within ten (10) days after notice of the filing thereof,
shall cause it to be discharged of record by payment, deposit, bond, order of a
court of competent jurisdiction or otherwise. If Tenant shall fail to cause
such Construction Lien to be discharged within the period aforesaid, then in
addition to any other right or remedy, Landlord may, but shall not be obligated
to, discharge it either by paying the amount claimed to be due or by procuring
the discharge of such lien by deposit or by bonding proceedings. Any amount so
paid by Landlord, plus all of Landlord’s costs and expenses associated
therewith (including, without limitation, reasonable legal fees), shall
constitute Additional Rent payable by Tenant under this Lease and shall be paid
by Tenant to Landlord on demand with interest from the date of advance by
Landlord at the Default Rate.

 

(b)           Nothing in this Lease, or in any
consent to the making of alterations or improvements shall be deemed or
construed in any way as constituting authorization by Landlord for the making
of any alterations or additions by Tenant within the meaning of 49 P.S.
Sections 1101-1902, as amended, or under the Contractor and Subcontractor
Payment Act or any amendment thereof, or constituting a request by Landlord,
express or implied, to any contractor, subcontractor or supplier for the
performance of any labor or the furnishing of any materials for the use or
benefit of Landlord.

 

12.           ASSIGNMENT AND SUBLETTING.

 

(a)           Subject
to the remaining subsections of Article 12, except as expressly
permitted pursuant to this section, Tenant shall not, without the prior written
consent of Landlord, such consent not to be unreasonably withheld, assign,
transfer or hypothecate this Lease or any interest herein or sublet the
Premises or any part thereof. Any of the foregoing acts without such consent
shall be void and shall, at the option of Landlord, terminate this Lease. Subject
to subparagraph 12(i) below, this Lease shall not, nor shall any interest
herein, be assignable as to the interest of Tenant by operation of law or by
merger, consolidation or asset sale, without the written consent of Landlord.

 

(b)           If
at any time or from time to time during the term of this Lease Tenant desires
to assign this Lease or sublet all or any part of the Premises, Tenant shall
give notice to Landlord of such desire, including the name, address and contact
party for the proposed assignee or subtenant, a description of such party’s
business history, the effective date of the proposed assignment or sublease
(including the proposed occupancy date by the proposed assignee or sublessee),
and in the instance of a proposed sublease, the square footage to be subleased,
a

 

6

 

floor plan professionally
drawn to scale depicting the proposed sublease area,  and a statement of the duration of the
proposed sublease (which shall in any and all events expire by its terms prior
to the scheduled expiration of this Lease, and immediately upon the sooner
termination hereof). Landlord may, at its option, and in its sole and absolute
discretion, exercisable by notice given to Tenant within sixty (60) days next
following Landlord’s receipt of Tenant’s notice (which notice from Tenant
shall, as a condition of its effectiveness, include all of the above-enumerated
information), elect to recapture the Premises if Tenant is proposing to sublet
or assign the Premises or such portion as is proposed by Tenant to be sublet
(and in each case, the designated and non-designated parking spaces included in
this demise, or a pro-rata portion thereof in the instance of the recapture of
less than all of the Premises), and terminate this Lease with respect to the
space being recaptured.

 

(c)           If Landlord elects to recapture the
Premises or a portion thereof as aforesaid, then from and after the effective
date thereof as approved by Landlord, after Tenant shall have fully performed
such obligations as are enumerated herein to be performed by Tenant in
connection with such recapture, and except as to obligations and liabilities
accrued and unperformed (and any other obligations expressly stated in this
Lease to survive the expiration or sooner termination of this Lease), Tenant
shall be released of and from all lease obligations thereafter otherwise
accruing with respect to the Premises (or such lesser portion as shall have
been recaptured by Landlord). The Premises, or such portion thereof as Landlord
shall have elected to recapture, shall be delivered by Tenant to Landlord free
and clear of all furniture, furnishings, personal property and removable
fixtures, with Tenant repairing and restoring any and all damage to the
Premises resulting from the installation, handling or removal thereof, and
otherwise in the same condition as Tenant is, by the terms of this Lease,
required to redeliver the Premises to Landlord upon the expiration or sooner
termination of this Lease. Upon the completion of any recapture and termination
as provided herein, Tenant’s Fixed Rent and other monetary obligations
hereunder shall be adjusted pro-rated based upon the reduced rentable square
footage then comprising the Premises.

 

(d)           If
Landlord provides written notification to Tenant electing not to recapture the
Premises (or so much thereof as Tenant had proposed to sublease), then Tenant
may proceed to market the designated space and may complete such transaction
and execute an assignment of this Lease or a sublease agreement (in each case
in form acceptable to Landlord) within a period of five (5) months next
following Landlord’s notice to Tenant that it declines to recapture such space,
provided that Tenant shall have first obtained in any such case the prior
written consent of Landlord to such transaction, which consent shall not be
unreasonably withheld. If, however, Tenant shall not have assigned this Lease
or sublet the Premises with Landlord’s prior written consent as aforesaid
within five (5) months next following Landlord’s notice to Tenant that Landlord
declines to recapture the Premises (or such portion thereof as Tenant initially
sought to sublease), then in such event, Tenant shall again be required to
request Landlord’s consent to the proposed transaction, whereupon Landlord’s
right to recapture the Premises (or such portion as Tenant shall desire to
sublease) shall be renewed upon the same terms and as otherwise provided in
subsection (b) above.

 

For purposes of this Section 12(d), and without
limiting the basis upon which Landlord may withhold its consent to any proposed
assignment or sublease, the parties agree that it shall not be unreasonable for
Landlord to withhold its consent to such assignment or sublease if: (i) the
proposed assignee or sublessee shall have a net worth which is not acceptable
to Landlord in Landlord’s reasonable discretion; (ii) the proposed assignee or
sublessee shall have no reliable credit history or an unfavorable credit
history, or other reasonable evidence exists that the proposed assignee or
sublessee will experience  difficulty in
satisfying its financial or other obligations under this Lease;  (iii) the proposed assignee of sublessee, in
Landlord’s reasonable opinion, is not reputable and of good character; (iv) the
portion of the Premises requested to be subleased renders the balance of the
Premises unleasable as a separate area; (v) Tenant is proposing a sublease at a
rental or subrental rate which is less than the then fair market rental rate
for the portion of the Premises being subleased or assigned, or Tenant is
proposing to assign or sublease to an existing tenant of the Building or
another property owned by Landlord or by its partners, or to another prospect
with whom Landlord or its partners, or their affiliates are then negotiating;
(vi) the proposed assignee or sublessee will cause Landlord’s existing parking
facilities to be reasonably inadequate, or in violation of code requirements,
or require Landlord to increase the parking area or the number of parking
spaces to meet code requirements, or the nature of such party’s business shall
reasonably require more than four (4) parking spaces per 1,000 rentable square feet
of floor space, or (vii) the nature of such party’s proposed business operation
would or

 

7

 

might reasonably permit or require the use of the
Premises in a manner inconsistent with the “Permitted Use” specified herein,
would or might reasonably otherwise be in conflict with express provisions of
this Lease,  would or might reasonably
violate the terms of  any other lease for
the Building, or would, in Landlord’s reasonable judgement, otherwise be
incompatible with other tenancies in the Building.

 

(e)           Any
sums or other economic consideration received by Tenant as a result of any
subletting, assignment or license (except rental or other payments received
which are attributable to the amortization of the cost of leasehold
improvements made to the sublet or assigned portion of the premises by Tenant
for subtenant or assignee, and other reasonable expenses incident to the
subletting or assignment, including standard leasing commissions) whether
denominated rentals under the sublease or otherwise, which exceed, in the
aggregate, the total sums which Tenant is obligated to pay Landlord under this
Lease (prorated to reflect obligations allocable to that portion of the
premises subject to such sublease or assignment) shall be divided evenly
between Landlord and Tenant, with Landlord’s portion being payable to Landlord
as Additional Rental under this Lease without affecting or reducing any other
obligation of Tenant hereunder.

 

(f)            Regardless of Landlord’s consent, no
subletting or assignment shall release Tenant of Tenant’s obligation or alter
the primary liability of Tenant to pay the Rent and to perform all other
obligations to be performed by Tenant hereunder. The acceptance of rental by
Landlord from any other person shall not be deemed to be a waiver by Landlord
of any provision hereof. Consent to one assignment or subletting shall not be
deemed consent to any subsequent assignment or subletting. In the event of
default by any assignee of Tenant or any successor of Tenant in the performance
of any of the terms hereof, Landlord may proceed directly against Tenant
without the necessity of exhausting remedies against such assignee or
successor.

 

(g)           In
the event that (i) the Premises or any part thereof are sublet and Tenant is in
default under this Lease, or (ii) this Lease is assigned by Tenant, then,
Landlord may collect Rent from the assignee or subtenant and apply the net
amount collected to the rent herein reserved; but no such collection shall be
deemed a waiver of the provisions of this Article 12 with respect to
assignment and subletting, or the acceptance of such assignee or subtenant as
Tenant hereunder, or a release of Tenant from further performance of the
covenants herein contained.

 

(h)           In
connection with each proposed assignment or subletting of the Premises by
Tenant, Tenant shall pay to Landlord (i) an administrative fee of $250 per
request (including requests for non-disturbance agreements and Landlord’s or
its lender’s waivers) in order to defer Landlord’s administrative expenses
arising from such request, plus (ii) Landlord’s reasonable attorneys’ fees.

 

(i)            Tenant
may, after notice to, but without the consent of Landlord, assign this Lease to
an affiliate (i.e., a corporation 50% or more of whose capital stock is owned
by the same stockholders owning 50% or more of Tenant’s capital stock), parent
or subsidiary corporation of Tenant or to a corporation to which it sells or
assigns all of substantially all of its assets or stock or with which it may be
consolidated or merged (“Affiliate”), provided such purchasing, consolidated,
merged, affiliated or subsidiary corporation shall, in writing, assume and
agree to perform all of the obligations of Tenant under this Lease, shall have
a net worth at least equal to $10,000,000,
and it shall deliver such assumption with a copy of such assignment to Landlord
within ten (10) days thereafter, and provided further that Tenant shall not be
released or discharged from any liability under this Lease by reason of such assignment.

 

(j)            Anything
in this Article 12 to the contrary notwithstanding, no assignment or
sublease shall be permitted under this Lease if Tenant is in default at the
time of such assignment or has previously defaulted (irrespective of the fact
that Tenant cured such default) more than twice in connection with any of its
monetary obligations under this Lease and such monetary defaults aggregate in
excess of $20,000.

 

13.           LANDLORD’S RIGHT OF ENTRY.

 

Landlord and persons authorized by Landlord may enter
the Premises at all reasonable times upon

 

8

 

reasonable advance notice
(except in the case of an emergency in which case no prior notice is necessary)
for the purpose of inspections, repairs, alterations to adjoining space,
appraisals, or other reasonable purposes; including enforcement of Landlord’s
rights under this Lease. Landlord shall not be liable for inconvenience to or
disturbance of Tenant by reason of any such entry; provided, however, that in
the case of repairs or work, such shall be done, so far as practicable, so as
to not unreasonably interfere with Tenant’s use of the Premises. Provided,
however, that such efforts shall not require Landlord to use overtime labor
unless Tenant shall pay for the increased costs to be incurred by Landlord for
such overtime labor. Landlord also shall have the right to enter the Premises
at all reasonable times after giving prior oral notice to Tenant, to exhibit
the Premises to any prospective purchaser and/or mortgagee. Landlord also shall
have the right to enter the Premises at all reasonable times after giving prior
oral notice to Tenant, to exhibit the Premises to any prospective tenants.

 

14.           REPAIRS AND MAINTENANCE.

 

(a)           Except
as specifically otherwise provided in subparagraphs (b) and (c) of this
Article, Tenant, at its sole cost and expense and throughout the Term of this
Lease, shall keep and maintain the Premises in good order and condition
(reasonable wear and tear excepted), free of accumulation of dirt and rubbish. Landlord
shall, upon written notice from Tenant, promptly make all repairs to the
Premises (except for any Alterations made by Tenant to the Base Building
Specifications) necessary to keep and maintain such good order and condition
and shall charge Tenant by invoice for the cost of such repairs at Landlord’s
standard rates (such rate to be competitive with the market rate for such
services). Such charges shall be considered Additional Rent and shall be
payable by Tenant within thirty (30) days of delivery of an invoice. When used
in this Article 14, the term “repairs” shall include replacements and
renewals when necessary.

 

(b)           Landlord,
throughout the Term of this Lease and at Landlord’s sole cost and expenses,
shall make all necessary repairs to the footings and foundations and the
structural steel columns and girders forming a part of the Premises.

 

(c)           Landlord
shall maintain all HVAC systems, plumbing and electric systems serving the
Building and the Premises.

 

(d)           Landlord,
throughout the Term of this Lease, shall make all necessary repairs to the
Building outside of the Premises and the common areas, including the roof,
walls, exterior portions of the Premises and the Building, utility lines,
equipment and other utility facilities in the Building, which serve more than
one tenant of the Building, and to any driveways, sidewalks, curbs, loading,
parking and landscaped areas, and other exterior improvements for the Building;
provided, however, that Landlord shall have no responsibility to make any
repairs unless and until Landlord receives written notice of the need for such
repair or Landlord has actual knowledge of the need to make such repair.

 

(e)           Landlord
shall keep and maintain all common areas appurtenant to the Building and any
sidewalks, parking areas, curbs and access ways adjoining the Property in a
clean and orderly condition, free of accumulation of dirt, rubbish, snow and
ice, and shall keep and maintain all landscaped areas in a neat and orderly
condition.

 

(f)            Notwithstanding
anything herein to the contrary, repairs to the Premises, Building or Project
and its appurtenant common areas made necessary by a negligent or willful act
or omission of Tenant or any employee, agent, contractor, or invitee of Tenant
shall be made at the sole cost and expense of Tenant, except to the extent of
insurance proceeds received by Landlord.

 

(g)           Landlord
shall provide Tenant with janitorial services for the Premises Monday through
Friday of each week in accordance with guidelines as may be set forth by
Landlord from time to time.

 

9

 

15.           INSURANCE; SUBROGATION RIGHTS.

 

(a)           Tenant
shall obtain and keep in force at all times during the term hereof, at its own
expense, commercial general liability insurance including contractual liability
and personal injury liability and all similar coverage, with combined single
limits of $1,000,000.00 on account of bodily injury to or death of one or more
persons as the result of any one accident or disaster and on account of damage
to property, or in such other amounts as Landlord may from time to time require.
Tenant shall also require its movers to procure and deliver to Landlord a
certificate of insurance naming Landlord as an additional insured.

 

(b)           All
liability insurance required hereunder shall not be subject to
cancellation without at least thirty (30) days prior notice to all insureds,
and shall name Landlord and Tenant as insureds, as their interests may appear,
and, if requested by Landlord, shall also name as an additional insured any
mortgagee or holder of any mortgage which may be or become a lien upon any part
of the Premises. Prior to the commencement of the Term, Tenant shall provide
Landlord with certificates which evidence that the coverages required have been
obtained for the policy periods. Tenant shall also furnish to Landlord
throughout the term hereof replacement certificates at least thirty (30) days
prior to the expiration dates of the then current policy or policies. All the
insurance required under this Lease shall be issued by insurance companies
authorized to do business in the Commonwealth of Pennsylvania with a financial
rating of at least an A-X as rated in the most recent edition of Best’s
Insurance Reports and in business for the past five years. The limit of any
such insurance shall not limit the liability of Tenant hereunder. If Tenant
fails to procure and maintain such insurance, Landlord may, but shall not be
required to, procure and maintain the same, at Tenant’s expense to be
reimbursed by Tenant as Additional Rent within ten (10) days of written demand.
Any deductible under such insurance policy or self-insured retention under such
insurance policy in excess of Twenty Five Thousand ($25,000) must be approved
by Landlord in writing prior to issuance of such policy. Tenant shall not
self-insure without Landlord’s prior written consent. The policy limits set
forth herein shall be subject to periodic review, and Landlord reserves the
right to require that Tenant increase the liability coverage limits if, in the
reasonable opinion of Landlord, the coverage becomes inadequate or is less than
commonly maintained by tenants of similar buildings in the area making similar
uses.

 

(c)           Landlord
shall obtain and maintain the following insurance during the Term of this
Lease:  (i) replacement cost insurance
including “special form” property insurance on the Building and on the Project,
and (ii) commercial general liability insurance (including bodily injury and
property damage) covering Landlord’s operations at the Project in amounts
reasonably required by the Landlord’s lender or Landlord.

 

(d)           Each party hereto, and anyone
claiming through or under them by way of subrogation, waives and releases any
cause of action it might have against the other party and their respective
employees, officers, members, partners, trustees and agents, on account of any
loss or damage that is insured against under any insurance policy required to
be obtained hereunder (to the extent that such loss or damage is recoverable under
such insurance policy) that covers the Project, Building or Premises, Landlord’s
or Tenant’s fixtures, personal property, leasehold improvements or business and
which names Landlord or Tenant, as the case may be, as a party insured. Each
party hereto agrees that it will cause its insurance carrier to endorse all
applicable policies waiving the carrier’s right of recovery under subrogation
or otherwise against the other party. During any period while such waiver of
right of recovery is in effect, each party shall look solely to the proceeds of
such policies for compensation for loss, to the extent such proceeds are paid
under such policies.

 

16.           INDEMNIFICATION.

 

Tenant shall defend, indemnify and hold harmless
Landlord and their respective affiliates, employees and agents from and against
any and all third-party claims, actions, damages, liability and expense
(including all reasonable attorney’s fees, expenses and liabilities incurred in
defense of any such claim or any action or proceeding brought thereon) arising
from (i) Tenant’s improper use of the Premises, (ii) the improper conduct of
Tenant’s business, (iii) any activity, work or things done, permitted or
suffered by Tenant or its agents, licensees or invitees in or about the
Premises or elsewhere contrary to the requirements of the Lease, (iv) any
breach or default in the performance of any obligation of Tenant’s part to be
performed under the terms of this Lease, and (v) any negligence or willful act
of Tenant or any of Tenant’s agents, contractors, employees or invitees. Without
limiting the generality of the foregoing, the obligations of Tenant shall
include any case in which Landlord shall be made a party to any

 

10

 

litigation arising out of
Tenant’s use or occupancy of the Premises and commenced by or against Tenant,
its agents, subtenants, licensees, concessionaires, contractors, customers or
employees, then Tenant shall defend, indemnify and hold harmless Landlord and
shall pay all costs, expenses and reasonable attorney’s fees incurred or paid
by Landlord in connection with such litigation, after notice to Tenant and
Tenant’s refusal to defend such litigation, and upon notice from Landlord shall
defend the same at Tenant’s expense by counsel satisfactory to Landlord.

 

17.           QUIET ENJOYMENT.

 

Provided Tenant has performed all of the terms and
conditions of this Lease, including the payment of Fixed Rent and Additional
Rent, to be performed by Tenant, Tenant shall peaceably and quietly hold and
enjoy the Premises for the Term, without hindrance from Landlord, or anyone
claiming by through or under Landlord under and subject to the terms and
conditions of this Lease and of any mortgages now or hereafter affecting all of
or any portion of the Premises.

 

18.           FIRE DAMAGE.

 

(a)           Except as provided below, in case of
damage to the Premises by fire or other insured casualty, Landlord shall repair
the damage. Such repair work shall be commenced promptly following notice of
the damage and completed with due diligence, taking into account the time
required for Landlord to effect a settlement with and procure insurance
proceeds from the insurer, except for delays due to governmental regulation,
scarcity of or inability to obtain labor or materials, intervening acts of God
or other causes beyond Landlord’s reasonable control.

 

(b)           Notwithstanding the foregoing, if (i)
the damage is of a nature or extent that, in Landlord’s reasonable judgment (to
be communicated to Tenant within sixty (60) days from the date of the casualty),
the repair and restoration work would require more than two hundred ten (210)
consecutive days to complete after the casualty (assuming normal work crews not
engaged in overtime), or (ii) if more than thirty (30%) percent of the total
area of the Building is extensively damaged, or (iii) the casualty occurs in
the last Lease Year of the Term and Tenant has not exercised a renewal right,
either party shall have the right to terminate this Lease and all the unaccrued
obligations of the parties hereto, by sending written notice of such
termination to the other within ten (10) days of Tenant’s receipt of the notice
from Landlord described above. Such notice is to specify a termination date no
less than fifteen (15) days after its transmission.

 

(c)           If the insurance proceeds received by
Landlord as dictated by the terms and conditions of any financing then existing
on the Building, (excluding any rent insurance proceeds) would not be
sufficient to pay for repairing the damage or are required to be applied on
account of any mortgage which encumbers any part of the Premises or Building,
or if the nature of loss is not covered by Landlord’s fire insurance coverage,
Landlord may elect either to (i) repair the damage as above provided
notwithstanding such fact or (ii) terminate this Lease by giving Tenant notice
of Landlord’s election as aforesaid.

 

(d)           In the event Landlord has not
completed restoration of the Premises within two hundred ten (210) days from
the date of casualty (subject to delay due to weather conditions, shortages of
labor or materials or other reasons beyond Landlord’s control, Tenant may
terminate this Lease by written notice to Landlord within thirty (30) business
days following the expiration of such 210 day period (as extended for reasons
beyond Landlord’s control as provided above) unless, within thirty (30)
business days following receipt of such notice, Landlord has substantially
completed such restoration and delivered the Premises to Tenant for occupancy. Notwithstanding
the foregoing, in the event Tenant is responsible for the aforesaid casualty,
Tenant shall not have the right to terminate this Lease if Landlord is
willing to rebuild and restore the Premises.

 

(e)           In the event of damage or destruction
to the Premises or any part thereof, Tenant’s obligation to pay Fixed Rent and
Additional Rent shall be equitably adjusted or abated.

 

11

 

19.           SUBORDINATION; RIGHTS OF MORTGAGEE.

 

(a)           This
Lease shall be subject and subordinate at all times to the lien of any
mortgages now or hereafter placed upon the Premises, Building and/or Project
and land of which they are a part without the necessity of any further
instrument or act on the part of Tenant to effectuate such subordination. Tenant
further agrees to execute and deliver upon demand such further instrument or
instruments evidencing such subordination of this Lease to the lien of any such
mortgage and such further instrument or instruments of attornment as shall be
desired by any mortgagee or proposed mortgagee or by any other person. Notwithstanding
the foregoing, any mortgagee may at any time subordinate its mortgage to this
Lease, without Tenant’s consent, by notice in writing to Tenant, and thereupon
this Lease shall be deemed prior to such mortgage without regard to their
respective dates of execution and delivery and in that event such mortgagee
shall have the same rights with respect to this Lease as though it had been
executed prior to the execution and delivery of the mortgage. Upon written
request of Tenant, Landlord shall use its reasonable efforts to deliver a
subordination, attornment and nondisturbance agreement (“Nondisturbance
Agreement”) from Landlord’s Mortgagee, on each such mortgagee’s standard form,
which shall provide, inter  alia, that the leasehold estate
granted to Tenant under this Lease will not be terminated or disturbed by
reason of the foreclosure of the mortgage held by Landlord’s Mortgagee, so long
as Tenant shall not be in default under this Lease and shall pay all sums due
under this Lease without offsets or defenses thereto and shall fully perform
and comply with all of the terms, covenants and conditions of this Lease on the
part of Tenant to be performed and/or complied with, and in the event a
mortgagee or its respective successor or assigns shall enter into and lawfully
become possessed of the Premises covered by this Lease and shall succeed to the
rights of Landlord hereunder, Tenant will attorn to the successor as its
landlord under this Lease and, upon the request of such successor landlord,
Tenant will execute and deliver an attornment agreement in favor of the
successor landlord.

 

(b)           In
the event Landlord shall be or is alleged to be in default of any of its
obligations owing to Tenant under this Lease, Tenant agrees to give to the
holder of any mortgage (collectively the “Mortgagee”) now or hereafter placed
upon the Premises, Building and/or Project, notice by overnight mail of any
such default which Tenant shall have served upon Landlord, provided that prior
thereto Tenant has been notified in writing (by way of Notice of Assignment of
Rents and/or Leases or otherwise in writing to Tenant) of the name and
addresses of any such Mortgagee. Tenant shall not be entitled to exercise any
right or remedy as there may be because of any default by Landlord without
having given such notice to the Mortgagee, if required to do so; and Tenant
further agrees that if Landlord shall fail to cure such default the Mortgagee
shall have thirty (30) additional days (measured from the later of the date on
which the default should have been cured by Landlord or the Mortgagee’s receipt
of such notice from Tenant), within which to cure such default, provided that
if such default be such that the same could not be cured within such period and
Mortgagee is diligently pursuing the remedies necessary to effectuate the cure
(including but not limited to foreclosure proceedings if necessary to
effectuate the cure); then Tenant shall not exercise any right or remedy as
there may be arising because of Landlord’s default, including but not limited
to, termination of this Lease as may be expressly provided for herein or
available to Tenant as a matter of law, if the Mortgagee either has cured the
default within such time periods, or as the case may be, has initiated the cure
of same within such period and is diligently pursuing the cure of same as
aforesaid.

 

20.           CONDEMNATION.

 

(a)           If more than twenty (20%) percent of
the floor area of the Premises is taken or condemned for a public or quasi-public
use (a sale in lieu of condemnation to be deemed a taking or condemnation for
purposes of this Lease), this Lease shall, at either party’s option, terminate
as of the date title to the condemned real estate vests in the condemnor, and
the Fixed Rent and Additional Rent herein reserved shall be apportioned and
paid in full by Tenant to Landlord to that date and all rent prepaid for period
beyond that date shall forthwith be repaid by Landlord to Tenant and neither
party shall thereafter have any liability hereunder.

 

(b)           If less than twenty (20%) percent of
the floor area of the Premises is taken or if neither Landlord nor Tenant have
elected to terminate this Lease pursuant to the preceding sentence, Landlord
shall do such work as may be reasonably necessary to restore the portion of the
Premises not taken to tenantable condition for Tenant’s uses, but shall not be
required to expend more than the net award Landlord reasonably expects to be
available for restoration of the Premises. If Landlord determines that the
damages available for restoration of the Building and/or Project will not be
sufficient to pay the cost of restoration, or if the condemnation damage award
is

 

12

 

required to be
applied on account of any mortgage which encumbers any part of the Premises,
Building and/or Project, Landlord may terminate this Lease by giving Tenant
thirty (30) days prior notice specifying the termination date.

 

(c)           If this Lease is not terminated after
any such taking or condemnation, the Fixed Rent and the Additional Rent shall
be equitably reduced in proportion to the area of the Premises which has been
taken for the balance of the Term.

 

(d)           If a part or all of the Premises
shall be taken or condemned, all compensation awarded upon such condemnation or
taking shall go to Landlord and Tenant shall have no claim thereto other than
Tenant’s damages associated with moving, storage and relocation; and Tenant
hereby expressly waives, relinquishes and releases to Landlord any claim for
damages or other compensation to which Tenant might otherwise be entitled
because of any such taking or limitation of the leasehold estate hereby
created, and irrevocably assigns and transfers to Landlord any right to
compensation of all or a part of the Premises or the leasehold estate.

 

21.           ESTOPPEL CERTIFICATE.

 

(a)           Each party agrees at any time and
from time to time, within ten (10) days after the other party’s written
request, to execute, acknowledge and deliver to the other party a written instrument
in recordable form certifying all information reasonably requested, including
but not limited to, the following: that this Lease is unmodified and in full
force and effect (or if there have been modifications, that it is in full force
and effect as modified and stating the modifications), the Commencement Date,
the expiration date of this Lease, the square footage of the Premises, the
rental rates applicable to the Premises, the dates to which Rent, Additional
Rent, and other charges have been paid in advance, if any, and stating whether
or not to the best knowledge of the party signing such certificate, the
requesting party is in default in the performance of any covenant, agreement or
condition contained in this Lease and, if so, specifying each such default of
which the signer may have knowledge. It is intended that any such certification
and statement delivered pursuant to this Article may be relied upon by any
prospective purchaser of the Project or any mortgagee thereof or any assignee
of Landlord’s interest in this Lease or of any mortgage upon the fee of the
Premises or any part thereof.

 

22.           DEFAULT.

 

If:

 

(a)           Tenant
fails to pay any installment of Fixed Rent or any amount of Additional Rent
when due; provided, however, Landlord shall provide written notice of the
failure to pay such Rent and Tenant shall have a three (3) business day grace
period from its receipt of such Landlord’s notice (facsimile receipt being
deemed to be notice hereunder) within which to pay such Rent without creating a
default hereunder. The late fee set forth in Article 5 hereof shall be due on
the first day after such payment is due irrespective of the foregoing notice
and grace period. No additional notice shall
be required thereafter and Landlord shall be entitled to immediately exercise
its remedies hereunder if payment is not received during the grace period,

 

(b)           Tenant
“vacates” the Premises (other than in the case of a permitted subletting or
assignment) or permits the same to be unoccupied

 

(c)           Tenant
fails to bond over a construction or mechanics lien within the time period set
forth in Article 11,

 

(d)           Tenant
fails to observe or perform any of Tenant’s other non-monetary agreements or
obligations herein contained within thirty (30) days after written notice specifying
the default, or the expiration of such additional time period as is reasonably
necessary to cure such default not to exceed sixty (60) days after written
notice specifying the default, provided Tenant immediately commences and
thereafter proceeds with all due diligence and in good faith to cure such
default,

 

13

 

(e)           Tenant makes any assignment for the
benefit of creditors,

 

(f)            a
petition is filed or any proceeding is commenced against Tenant or by Tenant
under any federal or state bankruptcy or insolvency law and such petition or
proceeding is not dismissed within thirty (30) days,

 

(g)           a
receiver or other official is appointed for Tenant or for a substantial part of
Tenant’s assets or for Tenant’s interests in this Lease,

 

(h)           any
attachment or execution against a substantial part of Tenant’s assets or of
Tenant’s interests in this Lease remains unstayed or undismissed for a period
of more than ten (10) days, or

 

(i)            a
substantial part of Tenant’s assets or of Tenant’s interest in this Lease is
taken by legal process in any action against Tenant,

 

then, in any such event, an Event of Default shall be deemed to exist
and Tenant shall be in default hereunder.

 

If an Event of Default shall occur, the following
provisions shall apply and Landlord shall have, in addition to all other rights
and remedies available at law or in equity, the rights and remedies set forth
therein, which rights and remedies may be exercised upon or at any time
following the occurrence of an Event of Default unless, prior to such exercise,
Landlord shall agree in writing with Tenant that the Event(s) of Default has
been cured by Tenant in all respects.

 

(a)           Acceleration of Rent.
By notice to Tenant, Landlord shall have the right to accelerate all Fixed Rent
and all expense installments due hereunder and otherwise payable in
installments over the remainder of the Term, and, at Landlord’s option, any
other Additional Rent to the extent that such Additional Rent can be determined
and calculated to a fixed sum; and the amount of accelerated rent to the
termination date, without further notice or demand for payment, shall be due
and payable by Tenant within five (5) days after Landlord has so notified
Tenant, such amount collected from Tenant shall be discounted to present value
using an interest rate of six percent (6%) per annum. Additional Rent which has
not been included, in whole or in part, in accelerated rent, shall be due and
payable by Tenant during the remainder of the Term, in the amounts and at the
times otherwise provided for in this Lease.

 

Notwithstanding the foregoing or the application of
any rule of law based on election of remedies or otherwise, if Tenant fails to
pay the accelerated rent in full when due, Landlord thereafter shall have the
right by notice to Tenant, (i) to terminate Tenant’s further right to
possession of the Premises and (ii) to terminate this Lease under subparagraph
(b) below; and if Tenant shall have paid part but not all of the accelerated
rent, the portion thereof attributable to the period equivalent to the part of
the Term remaining after Landlord’s termination of possession or termination of
this Lease shall be applied by Landlord against Tenant’s obligations owing to
Landlord, as determined by the applicable provisions of subparagraphs (c) and
(d) below.

 

(b)           Termination of Lease.
By notice to Tenant, Landlord shall have the right to terminate this Lease as
of a date specified in the notice of termination and in such case, Tenant’s
rights, including any based on any option to renew, to the possession and use
of the Premises shall end absolutely as of the termination date; and this Lease
shall also terminate in all respects except for the provisions hereof regarding
Landlord’s damages and Tenant’s liabilities arising prior to, out of and
following the Event of Default and the ensuing termination.

 

Following such termination and the notice of same
provided above (as well as upon any other termination of this Lease by
expiration of the Term or otherwise) Landlord immediately shall have the right
to recover possession of the Premises; and to that end, Landlord may enter the
Premises and take possession, without the necessity of giving Tenant any notice
to quit or any other further notice, with or without legal process or
proceedings, and in so doing Landlord may remove Tenant’s property (including
any improvements or additions to the Premises which Tenant made, unless made
with Landlord’s consent which expressly permitted Tenant to not

 

14

 

remove the same upon
expiration of the Term), as well as the property of others as may be in the
Premises, and make disposition thereof in such manner as Landlord may deem to
be commercially reasonable and necessary under the circumstances.

 

(c)           Tenant’s Continuing Obligations/Landlord’s 
Reletting Rights.

 

(i)            Unless
and until Landlord shall have terminated this Lease under subparagraph (b)
above, Tenant shall remain fully liable and responsible to perform all of the
covenants and to observe all the conditions of this Lease throughout the
remainder of the Term to the early termination date; and, in addition, Tenant
shall pay to Landlord, upon demand and as Additional Rent, the total sum of all
costs, losses, damages and expenses, including reasonable attorneys’ fees, as
Landlord incurs, directly or indirectly, because of any Event of Default having
occurred.

 

(ii)           If
Landlord either terminates Tenant’s right to possession without terminating
this Lease or terminates this Lease and Tenant’s leasehold estate as above
provided, then, subject to the provisions below, Landlord shall have the
unrestricted right to relet the Premises or any part(s) thereof to such
tenant(s) on such provisions and for such period(s) as Landlord may deem
appropriate. Landlord agrees, however,
to use reasonable efforts to mitigate its damages, provided that Landlord shall
not be liable to Tenant for its inability to mitigate damages if it shall
endeavor to relet the Premises in like manner as it offers other comparable
vacant space or property available for leasing to others in the Project of
which the Building is a part. If Landlord relets the Premises after such
a default, the costs recovered from Tenant shall be reallocated to take into
consideration any additional rent which Landlord receives from the new tenant
which is in excess to that which was owed by Tenant.

 

(iii)          Notwithstanding
anything in this Lease to the contrary, in the event of a default under this
Lease (including the filing of bankruptcy by or against Tenant), all personal
property of Tenant at the Building, shall become Landlord’s property, shall
constitute security of Tenant’s obligations under this Lease and shall not be
removed by Tenant from the Building.

 

(d)           Landlord’s Damages.

 

(i)            The
damages which Landlord shall be entitled to recover from Tenant shall be the
sum of:

 

(A)               all Fixed Rent and Additional
Rent accrued and unpaid as of the termination date; and

 

(B)               (i)  all costs and expenses incurred by Landlord
in recovering possession of the Premises, including removal and storage of
Tenant’s property, (ii) the costs and expenses of restoring the Premises to the
condition in which the same were to have been surrendered by Tenant as of the
expiration of the Term, and (iii) the costs of reletting commissions; and

 

(C)               all Fixed Rent and Additional
Rent (to the extent that the amount(s) of Additional Rent has been then
determined) otherwise payable by Tenant over the remainder of the Term as
reduced to present value.

 

Less deducting from the total determined under subparagraphs (A), (B)
and (C) all Rent and all other Additional Rent to the extent determinable as
aforesaid, (to the extent that like charges would have been payable by Tenant)
which Landlord receives from other tenant(s) by reason of the leasing of the
Premises or part during or attributable to any period falling within the
otherwise remainder of the Term.

 

(ii)           The
damage sums payable by Tenant under the preceding provisions of this paragraph
(d) shall be payable on demand from time to time as the amounts are determined;
and if from Landlord’s subsequent receipt of rent as aforesaid from reletting,
there be any excess payment(s) by Tenant by reason of the

 

15

 

crediting of such rent
thereafter received, the excess payment(s) shall be refunded by Landlord to
Tenant, without interest.

 

(iii)          Landlord
may enforce and protect the rights of Landlord hereunder by a suit or suits in
equity or at law for the specific performance of any covenant or agreement
contained herein, and for the enforcement of any other appropriate legal or
equitable remedy, including, without limitation, injunctive relief, and for
recovery of consequential damages and all moneys due or to become due from Tenant
under any of the provisions of this Lease.

 

(e)           Landlord’s
Right to Cure. Without limiting the generality of the foregoing, if Tenant
shall be in default in the performance of any of its obligations hereunder,
Landlord, without being required to give Tenant any notice or opportunity to
cure, may (but shall not be obligated to do so), in addition to any other
rights it may have in law or in equity, cure such default on behalf of Tenant,
and Tenant shall reimburse Landlord upon demand for any sums paid or costs
incurred by Landlord in curing such default, including reasonable attorneys’
fees and other legal expenses, together with interest at 10% per annum Rate
from the dates of Landlord’s incurring of costs or expenses.

 

Tenant further waives the right to any notices to quit
as may be specified in the Landlord and Tenant Act of Pennsylvania, Act of
April 6, 1951, as amended, or any similar or successor provision of law, and
agrees that five (5) days notice shall be sufficient in any case where a longer
period may be statutorily specified.

 

(f)            Additional
Remedies. In addition to, and not in lieu of any of the foregoing rights
granted to Landlord:

 

(i)            TENANT HEREBY EMPOWERS ANY PROTHONOTARY, CLERK OF COURT OR ATTORNEY OF
ANY COURT OF RECORD TO APPEAR FOR TENANT IN ANY AND ALL ACTIONS WHICH MAY BE
BROUGHT FOR ANY RENT, OR ANY CHARGES HEREBY RESERVED OR DESIGNATED AS RENT OR
ANY OTHER SUM PAYABLE BY TENANT TO LANDLORD UNDER OR BY REASON OF THIS LEASE
(INCLUDING, WITHOUT LIMITATION, ANY SUM PAYABLE UNDER SUBPARAGRAPHS (a) THROUGH
(e) OF THIS ARTICLE 22, AND TO SIGN FOR TENANT AN AGREEMENT FOR ENTERING
IN ANY COMPETENT COURT AN ACTION OR ACTIONS FOR THE RECOVERY OF SAID RENT,
CHARGES AND OTHER SUMS, AND IN SAID SUIT OR IN SAID ACTION OR ACTIONS TO
CONFESS JUDGMENT AGAINST TENANT FOR ALL OR ANY PART OF THE RENT SPECIFIED IN
THIS LEASE AND THEN UNPAID INCLUDING, AT LANDLORD’S OPTION, THE RENT FOR THE
ENTIRE UNEXPIRED BALANCE OF THE TERM OF THIS LEASE, AND ALL OR ANY PART OF ANY
OTHER OF SAID CHARGES OR SUMS, AND FOR INTEREST AND COSTS TOGETHER WITH
REASONABLE ATTORNEY’S FEES OF 5%. SUCH AUTHORITY SHALL NOT BE EXHAUSTED BY ONE
EXERCISE THEREOF, BUT JUDGMENT MAY BE CONFESSED AS AFORESAID FROM TIME TO TIME
AS OFTEN AS ANY OF SAID RENT OR SUCH OTHER SUMS, CHARGES, PAYMENTS, COSTS AND
EXPENSES SHALL FALL DUE OR BE IN ARREARS, AND SUCH POWERS MAY BE EXERCISED AS
WELL AFTER THE EXPIRATION OF THE TERM OR DURING ANY EXTENSION OR RENEWAL OF
THIS LEASE.

 

(ii)           WHEN
THIS LEASE OR TENANT’S RIGHT OF POSSESSION SHALL BE TERMINATED BY COVENANT OR
CONDITION BROKEN, OR FOR ANY OTHER REASON, EITHER DURING THE TERM OF THIS LEASE
OR ANY RENEWAL OR EXTENSION THEREOF, AND ALSO WHEN AND AS SOON AS THE TERM
HEREBY CREATED OR ANY EXTENSION THEREOF SHALL HAVE EXPIRED, IT SHALL BE LAWFUL
FOR ANY ATTORNEY AS ATTORNEY FOR TENANT TO FILE AN AGREEMENT FOR ENTERING IN
ANY COMPETENT COURT AN ACTION TO CONFESS JUDGMENT IN EJECTMENT AGAINST TENANT
AND ALL PERSONS CLAIMING UNDER TENANT, WHEREUPON, IF LANDLORD SO DESIRES, A
WRIT OF EXECUTION OR OF POSSESSION MAY ISSUE FORTHWITH, WITHOUT ANY PRIOR WRIT
OF PROCEEDINGS, WHATSOEVER, AND PROVIDED THAT IF FOR ANY REASON AFTER SUCH
ACTION SHALL HAVE BEEN COMMENCED THE SAME SHALL BE

 

16

 

DETERMINED AND THE
POSSESSION OF THE PREMISES HEREBY DEMISED REMAIN IN OR BE RESTORED TO TENANT,
LANDLORD SHALL HAVE THE RIGHT UPON ANY SUBSEQUENT DEFAULT OR DEFAULTS, OR UPON
THE TERMINATION OF THIS LEASE AS HEREINBEFORE SET FORTH, TO BRING ONE OR MORE
ACTION OR ACTIONS AS HEREINBEFORE SET FORTH TO RECOVER POSSESSION OF THE SAID
PREMISES.

 

In any action to confess judgment in ejectment or for
rent in arrears, Landlord shall first cause to be filed in such action an
affidavit made by it or someone acting for it setting forth the facts necessary
to authorize the entry of judgment, of which facts such affidavit shall be
conclusive evidence, and if a true copy of this Lease (and of the truth of the
copy such affidavit shall be sufficient evidence) be filed in such action, it
shall not be necessary to file the original as a warrant of attorney, any rule
of Court, custom or practice to the contrary notwithstanding.

 

               (INITIAL).
TENANT WAIVER. TENANT SPECIFICALLY ACKNOWLEDGES THAT TENANT HAS VOLUNTARILY,
KNOWINGLY AND INTELLIGENTLY WAIVED CERTAIN DUE PROCESS RIGHTS TO A PREJUDGMENT
HEARING BY AGREEING TO THE TERMS OF THE FOREGOING PARAGRAPHS REGARDING
CONFESSION OF JUDGMENT. TENANT FURTHER SPECIFICALLY AGREES THAT IN THE EVENT OF
DEFAULT, LANDLORD MAY PURSUE MULTIPLE REMEDIES INCLUDING OBTAINING POSSESSION
PURSUANT TO A JUDGMENT BY CONFESSION AND ALSO OBTAINING A MONEY JUDGEMENT FOR
PAST DUE AND ACCELERATED AMOUNTS AND EXECUTING UPON SUCH JUDGMENT. IN SUCH
EVENT AND SUBJECT TO THE TERMS SET FORTH HEREIN, LANDLORD SHALL PROVIDE FULL
CREDIT TO TENANT FOR ANY MONTHLY CONSIDERATION WHICH LANDLORD RECEIVES FOR THE
LEASED PREMISES IN MITIGATION OF ANY OBLIGATION OF TENANT TO LANDLORD FOR THAT
MONEY. FURTHERMORE, TENANT SPECIFICALLY WAIVES ANY CLAIM AGAINST LANDLORD AND
LANDLORD’S COUNSEL FOR VIOLATION OF TENANT’S CONSTITUTIONAL RIGHTS IN THE EVENT
THAT JUDGMENT IS CONFESSED PURSUANT TO THIS LEASE.

 

(g)           Interest on Damage Amounts.
Any sums payable by Tenant hereunder, which are not paid after the same shall
be due, shall bear interest from that day until paid at the rate of four (4%)
percent over the then Prime Rate as published daily under the heading “Money
Rates” in The Wall Street Journal, unless such rate be usurious as
applied to Tenant, in which case the highest permitted legal rate shall apply
(the “Default Rate”).

 

(h)           Landlord’s Statutory Rights.
Landlord shall have all rights and remedies now or hereafter existing at law or
in equity with respect to the enforcement of Tenant’s obligations hereunder and
the recovery of the Premises. No right or remedy herein conferred upon or
reserved to Landlord shall be exclusive of any other right or remedy, but shall
be cumulative and in addition to all other rights and remedies given hereunder
or now or hereafter existing at law. Landlord shall be entitled to injunctive
relief in case of the violation, or attempted or threatened violation, of any
covenant, agreement, condition or provision of this Lease, or to a decree
compelling performance of any covenant, agreement, condition or provision of
this Lease.

 

(i)            Remedies Not Limited.
Nothing herein contained shall limit or prejudice the right of Landlord to
exercise any or all rights and remedies available to Landlord by reason of
default or to prove for and obtain in proceedings under any bankruptcy or
insolvency laws, an amount equal to the maximum allowed by any law in effect at
the time when, and governing the proceedings in which, the damages are to be
proved, whether or not the amount be greater, equal to, or less than the amount
of the loss or damage referred to above.

 

(j)            No Waiver by Landlord.
No delay or forbearance by Landlord in exercising any right or remedy
hereunder, or Landlord’s undertaking or performing any act or matter which is
not expressly required to be undertaken by Landlord shall be construed,
respectively, to be a waiver of Landlord’s rights or to represent any agreement
by Landlord to undertake or perform such act or matter thereafter. Waiver by
Landlord of any breach by Tenant of any covenant or condition herein contained
(which waiver shall be effective only if so expressed in writing by Landlord)
or failure by Landlord to exercise any right or remedy in respect of any such
breach shall not constitute a waiver or relinquishment for the future of
Landlord’s right to have any such covenant or condition duly performed

 

17

 

or observed by Tenant, or
of Landlord’s rights arising because of any subsequent breach of any such
covenant or condition nor bar any right or remedy of Landlord in respect of
such breach or any subsequent breach. Landlord’s receipt and acceptance of any
payment from Tenant which is tendered not in conformity with the provisions of
this Lease or following an Event of Default (regardless of any endorsement or
notation on any check or any statement in any letter accompanying any payment)
shall not operate as an accord and satisfaction or a waiver of the right of
Landlord to recover any payments then owing by Tenant which are not paid in
full, or act as a bar to the termination of this Lease and the recovery of the
Premises because of Tenant’s previous default.

 

23.           LANDLORD’S LIEN.

 

In addition to any applicable common law or statutory
lien, none of which are to be deemed waived by Landlord, Landlord shall have,
at all times, and Tenant hereby grants to Landlord, a valid lien and security
interest to secure payment of all rentals and other sums of money becoming due
hereunder from Tenant, and to secure payment of any damages or loss which
Landlord may suffer by reason of the breach by Tenant of any covenant,
agreement or condition contained herein, upon all goods, wares, equipment,
fixtures, furniture, improvements and other personal property of Tenant which
may hereafter be situated on the Premises, and all proceeds therefrom, and such
property shall not be removed therefrom without the consent of Landlord until
all arrearage in Rent as well as any and all other sums of money then due to
Landlord hereunder shall first have been paid and discharged and all the
covenants, agreements and conditions hereof have been fully complied with and
performed by Tenant. Landlord covenants and agrees to subordinate the lien
granted hereunder to any commercial lender which Tenant grants a security
interest. Upon the occurrence of an Event of Default by Tenant, but subject to
Tenant’s lender rights, if any, after the expiration of all stated notice and
cure periods, Landlord may, in addition to any other remedies provided herein,
peaceably enter upon the Premises and take possession of any and all goods,
wares, equipment, fixtures, furniture, improvements and other personal property
of Tenant situated on the Premises, without liability for trespass or
conversion, and sell the same at public or private sale, with or without having
such property at the sale, after giving Tenant reasonable notice of time and
place of any public sale or of the time after which any private sale is to be
made, at which sale Landlord or its assigns may purchase unless otherwise
prohibited by law. Unless otherwise provided by law, and without intending to
exclude any other manner of giving Tenant reasonable notice, the requirement of
reasonable notice shall be met if such notice is given in the manner prescribed
in Article 28 of this Lease at least five (5) days before the time of
sale. The proceeds from any such disposition, less all expenses connected with
the taking of possession, holding and selling of the property (including
reasonable attorney’s fees and other expenses), shall be applied as a credit
against the indebtedness secured by the security interest granted in this Article
23. Any surplus shall be paid to Tenant or as otherwise required by law;
and Tenant shall pay any deficiencies forthwith. Upon request by Landlord,
Tenant agrees to execute and deliver to Landlord a financing statement in form
sufficient to perfect the security interest of Landlord in the aforementioned
property and proceeds thereof under the provisions of the Uniform Commercial
Code in force in the Commonwealth of Pennsylvania. Notwithstanding the
foregoing, the parties acknowledge and agree that Tenant’s lender may have
superior rights to the property noted herein. After notice by Landlord in
accordance with Article 28 hereof, Tenant shall use its best efforts to
obtain, within forty-five (45) days of such notice, a waiver of all such rights
from its lender in this regard, and, failing to obtain such waiver, that Tenant
shall use its best efforts to obtain from such lender, the right to grant a
subordinated lien to Landlord in such goods, second only to the lien of such
lender.

 

24.           LANDLORD’S REPRESENTATIONS AND
WARRANTIES.

 

Landlord represents and warrants to Tenant that:  (a) Landlord is the owner of the Building and
the Project; (b) Landlord has the authority to enter into this Lease and (c)
the person executing this Lease is duly authorized to execute and deliver this
Lease on behalf of Landlord.

 

25.           SURRENDER.

 

Tenant shall, at the expiration of the Term, promptly
quit and surrender the Premises in good order and condition and in conformity
with the applicable provisions of this Lease, excepting only reasonable wear
and tear and damage by fire or other insured casualty. Tenant shall have no
right to hold over beyond the expiration of

 

18

 

the Term and in the event
Tenant shall fail to deliver possession of the Premises as herein provided,
such occupancy shall not be construed to effect or constitute other than a
tenancy at sufferance. During any period of occupancy  beyond the expiration of the Term the amount
of rent owed to Landlord by Tenant shall automatically become two hundred
percent (200%) the sum of the Rent as those sums are at that time calculated
under the provisions of the Lease. If Tenant fails to surrender the space
within thirty (30) days of the termination date, Landlord may elect to
automatically extend the Term for an additional month or additional year, at
Landlord’s option, with a Rent of two hundred percent (200%) the sum of the
Rent as those sums are at that time calculated under the provisions of the
Lease. The acceptance of rent by Landlord or the failure or delay of Landlord
in notifying or evicting Tenant following the expiration or sooner termination
of the Term shall not create any tenancy rights in Tenant and any such payments
by Tenant may be applied by Landlord against its costs and expenses, including
attorney’s fees, incurred by Landlord as a result of such holdover.

 

26.           RULES AND REGULATIONS.

 

Tenant agrees that at all times during the terms of
this Lease (as same may be extended) it, its employees, agents, invitees and
licenses shall comply with all rules and regulations as Landlord may from time
to time promulgate provided they do not increase the financial burdens of
Tenant or unreasonably restrict Tenant’s rights under this Lease. Tenant’s
right to dispute the reasonableness of any changes in or additions to the Rules
and Regulations shall be deemed waived unless asserted to Landlord within ten
(10) business days after Landlord shall have given Tenant written notice of any
such adoption or change. In case of any conflict or inconsistency between the
provisions of this Lease and any Rules and Regulations, the provisions of this
Lease shall control. Landlord shall have no duty or obligation to enforce any
Rule and Regulation, or any term, covenant or condition of any other lease,
against any other tenant, and Landlord’s failure or refusal to enforce any Rule
or Regulation or any term, covenant of condition of any other lease against any
other tenant shall be without liability of Landlord to Tenant. However, if
Landlord does enforce Rules or Regulations, Landlord shall endeavor to enforce
same equally in a non-discriminatory manner.

 

27.           GOVERNMENTAL REGULATIONS.

 

(a)           Tenant shall, in the use and
occupancy of the Premises and the conduct of Tenant’s business or profession
therein, at all times comply with all applicable laws, ordinances, orders,
notices, rules and regulations of the federal, state and municipal governments,
or any of their departments and the regulations of the insurers of the
Premises, Building and/or Project.

 

(b)           Without limiting the generality of
the foregoing, Tenant shall (i) obtain, at Tenant’s expense, before engaging in
Tenant’s business or profession within the Premises, all necessary licenses and
permits including (but not limited to) state and local business licenses or
permits, and (ii) remain in compliance with and keep in full force and effect
at all times all licenses, consents and permits necessary for the lawful
conduct of Tenant’s business or profession at the Premises. Tenant shall pay
all personal property taxes, income taxes and other taxes, assessments, duties,
impositions and similar charges which are or may be assessed, levied or imposed
upon Tenant and which, if not paid, could be liened against the Premises or
against Tenant’s property therein or against Tenant’s leasehold estate.

 

(c)           Landlord
shall be responsible for compliance with Title III of the Americans with
Disabilities Act of l990, 42 U.S.C. ‘12181 et  seq. and its
regulations, (collectively, the “ADA”) (i) as to the design and construction of
exterior common areas (e.g. sidewalks and parking areas) and (ii) with
respect to the initial design and construction of the Premises. Except as set
forth above in the initial sentence hereto, Tenant shall be responsible for
compliance with the ADA in all other respects concerning the use and occupancy
of the Premises, which compliance shall include, without limitation (i)
provision for full and equal enjoyment of the goods, services, facilities,
privileges, advantages or accommodations of the Premises as contemplated by and
to the extent required by the ADA, (ii) compliance relating to requirements
under the ADA or amendments thereto arising after the date of this Lease and (iii)
compliance relating to the design, layout, renovation, redecorating,
refurbishment, alteration, or improvement to the Premises made or requested by
Tenant at any time following the Commencement Date.

 

19

 

28.           NOTICES.

 

(a)           Wherever
in this Lease it shall be required or permitted that notice or demand be given
or served by either party to this Lease to or on the other party, such notice
or demand shall be deemed to have been duly given or served if in writing and
either: (i) personally served; (ii) delivered by pre-paid nationally recognized
overnight courier service (e.g. Federal Express) with evidence of
receipt required for delivery; (iii) forwarded by Registered or Certified mail,
return receipt requested, postage prepaid; (iv) facsimile with a copy mailed by
first class United States mail or (v) e-mailed with evidence of receipt and
delivery of a copy of the notice by first class mail; in all such cases
addressed to the parties at the addresses set forth in Article 1(k)
hereof. Each such notice shall be deemed to have been given to or served upon
the party to which addressed on the date the same is delivered or delivery is
refused. Either party hereto may change its address to which said notice shall
be delivered or mailed by giving written notice of such change to the other
party hereto, as herein provided.

 

29.           BROKERS.

 

Landlord and Tenant each represents and warrants to
the other that such party has had no dealings, negotiations or consultations
with respect to the Premises or this transaction with any broker or finder; and
that otherwise no broker or finder called the Premises to Tenant’s attention
for lease or took any part in any dealings, negotiations or consultations with
respect to the Premises or this Lease. Each party agrees to indemnify and hold
the other harmless from and against all liability, cost and expense, including
attorney’s fees and court costs, arising out of any misrepresentation or breach
of warranty under this Article.

 

30.           CHANGE OF BUILDING/PROJECT NAME.

 

Landlord reserves the right at any time and from time
to time to change the name by which the Building and/or Project is designated.

 

31.           LANDLORD’S LIABILITY.

 

Landlord’s obligations hereunder shall be binding upon
Landlord only for the period of time that Landlord is in ownership of the
Building; and, upon termination of that ownership, Tenant, except as to any
obligations which are then due and owing, shall look solely to Landlord’s
successor in interest in the Building for the satisfaction of each and every
obligation of Landlord hereunder. Landlord shall have no personal liability
under any of the terms, conditions or covenants of this Lease and Tenant shall
look solely to the equity of Landlord in the Building of which the Premises
form a part for the satisfaction of any claim, remedy or cause of action
accruing to Tenant as a result of the breach of any section of this Lease by
Landlord. In addition to the foregoing, no recourse shall be had for an
obligation of Landlord hereunder, or for any claim based thereon or otherwise
in respect thereof, against any past, present or future trustee, member,
partner, shareholder, officer, director, partner, agent or employee of
Landlord, whether by virtue of any statute or rule of law, or by the
enforcement of any assessment or penalty or otherwise, all such other liability
being expressly waived and released by Tenant with respect to the above-named
individuals and entities.

 

32.           AUTHORITY.

 

Tenant represents and warrants that (a) Tenant is duly
organized, validly existing and legally authorized to do business in the
Commonwealth of Pennsylvania, and (b) the persons executing this Lease are duly
authorized to execute and deliver this Lease on behalf of Tenant.

 

33.           NO OFFER.

 

The submission of the Lease by Landlord to Tenant for
examination does not constitute a reservation of or option for the Premises or
of any other space within the Building or in other buildings owned or

 

20

 

managed by Landlord or
its affiliates. This Lease shall become effective as a Lease only upon the
execution and legal delivery thereof by both parties hereto.

 

34.           RENEWAL.

 

Provided Tenant is neither
in default at the time of exercise nor has Tenant ever been in default
(irrespective of the fact that Tenant cured such default) of any monetary
obligations under this Lease more than twice during the Term and such monetary
default aggregates in excess of $60,000, and Tenant is fully occupying the
Premises and the Lease is in full force and effect, Tenant shall have the right
to renew this Lease for one (1) term of five (5) years each beyond the end of
the initial Term (each, a “Renewal Term”). Tenant shall furnish written notice
of intent to renew one (1) year prior to the expiration of the applicable Term,
failing which, such renewal right shall be deemed waived; time being of the
essence. The terms and conditions of this Lease during each Renewal Term shall
remain unchanged except that the annual Fixed Rent for each Renewal Term shall
be the greater of (i) the Fixed Rent for the term expiring, and (ii) Fair
Market Rent (as such term is hereinafter defined), with in any event, annual
increases. All factors regarding Additional Rent shall remain unchanged, and no
Tenant allowance shall be included in the absence of further agreement by the
parties. Anything herein contained to the contrary notwithstanding, Tenant
shall have no right to renew the term hereof other than or beyond the one (1)
consecutive five (5) year term hereinabove described. It shall be a condition
of each such Renewal Term that Landlord and Tenant shall have executed, not
less than six (6) months prior to the expiration of the then expiring term
hereof, an appropriate amendment to this Lease, in form and content
satisfactory to each of them, memorializing the extension of the term hereof
for the next ensuing Renewal Term.

 

For purposes of this Lease, “Fair Market Rent” shall mean the base rent,
for comparable space, net of all free or reduced rent periods, work letters,
cash allowances, fit-out periods and other tenant inducement concessions
however denominated except as hereinafter provided. In determining the Fair
Market Rent, Landlord, Tenant and any appraiser shall take into account
applicable measurement and the loss factors, applicable lengths of lease term,
differences in size of the space demised, the location of the Building and
comparable buildings, amenities in the Building and comparable buildings, the
ages of the Building and comparable buildings, differences in base years or
stop amounts for operating expenses and tax escalations and other factors
normally taken into account in determining Fair Market Rent. The Fair Market
Rent shall reflect the level of improvement made or to be made by Landlord to
the space under this Lease. If Landlord and Tenant cannot agree on the Fair
Market Rent, the Fair Market Rent shall be established by the following
procedure: (1) Tenant and Landlord shall agree on a single MAI certified
appraiser who shall have a minimum of ten (10) years experience in real estate
leasing in the market in which the Premises is located, (2) Landlord and Tenant
shall each notify the other (but not the appraiser), of its determination of
such Fair Market Rent and the reasons therefor, (3) during the next seven (7)
days both Landlord and Tenant shall prepare a written critique of the other’s
determination and shall deliver it to the other party, (4) on the tenth (10th)
day following delivery of the critiques to each other, Landlord’s and Tenant’s
determinations and critiques (as originally submitted to the other party, with
no modifications whatsoever) shall be submitted to the appraiser, who shall
decide whether Landlord’s or Tenant’s determination of Fair Market Rent is more
correct. The determinations so chosen shall be the Fair Market Rent. The
appraiser shall not be empowered to choose any number other than the Landlord’s
or Tenant’s. The fees of the appraiser shall be paid by the non-prevailing
party.

 

35.           INTENTIONALLY OMITTED.

 

36.           TENANT FINANCIAL INFORMATION.

 

Any time and from time to time during the Term (but
not more than once during any twelve month period unless a default has occurred
under this Lease or Landlord has a reasonable basis to suspect that Tenant has
suffered a material adverse change in its financial position) upon not less
than thirty (30) days prior written request from Landlord, Tenant shall deliver
to Landlord: (i) a current, accurate, complete and detailed balance sheet of
Tenant (dated no more than thirty (30) days prior to such delivery), a profit
and loss statement, a cash flow summary and all relevant accounting footnotes,
all prepared in accordance with generally accepted accounting principles
consistently applied and certified by the Chief Financial Officer of Tenant to
be a fair and true presentation of 

 

21

 

Tenant’s current
financial position; and (ii) a current, accurate, complete and detailed
financial statements of Tenant audited by an independent certified public
accountant for the last applicable calendar year. Tenant agrees that its
failure to strictly comply with this Article 38 shall constitute a
material Default by Tenant under this Lease. Landlord shall keep all
information provided hereunder strictly confidential.

 

37.           MISCELLANEOUS PROVISIONS.

 

(a)           Successors.
The respective rights and obligations provided in this Lease shall bind and
inure to the benefit of the parties hereto, their successors and assigns;
provided, however, that no rights shall inure to the benefit of any successors
or assigns of Tenant unless Landlord’s written consent for the transfer to such
successor and/or assignee has first been obtained as provided in Article 12
hereof.

 

(b)           Governing
Law. This Lease shall be construed, governed and enforced in accordance
with the laws of the Commonwealth of Pennsylvania, without regard to principles
relating to conflicts of law.

 

(c)           Severability.
If any provisions of this Lease shall be held to be invalid, void or
unenforceable, the remaining provisions hereof shall in no way be affected or
impaired and such remaining provisions shall remain in full force and effect.

 

(d)           Captions.
Marginal captions, titles or exhibits and riders and the table of contents in
this Lease are for convenience and reference only, and are in no way to be
construed as defining, limiting or modifying the scope or intent of the various
provisions of this Lease.

 

(e)           Gender.
As used in this Lease, the word “person” shall mean and include, where
appropriate, an individual, corporation, partnership or other entity; the
plural shall be substituted for the singular, and the singular for the plural,
where appropriate; and the words of any gender shall mean to include any other
gender.

 

(f)            Entire
Agreement. This Lease, including the Exhibits and any Riders hereto (which
are hereby incorporated by this reference, except that in the event of any
conflict between the printed portions of this Lease and any Exhibits or Riders,
the term of such Exhibits or Riders shall control), supersedes any prior
discussions, proposals, negotiations and discussions between the parties and
the Lease contains all the agreements, conditions, understandings,
representations and warranties made between the parties hereto with respect to
the subject matter hereof, and may not be modified orally or in any manner
other than by an agreement in writing signed by both parties hereto or their
respective successors in interest. Without in any way limiting the generality
of the foregoing, this Lease can only be extended pursuant to the terms hereof,
and in Tenant’s case, with the terms hereof, with the due exercise of an option
(if any) contained herein pursuant to a written agreement signed by both
Landlord and Tenant specifically extending the term. No negotiations,
correspondence by Landlord or offers to extend the term shall be deemed an
extension of the termination date for any period whatsoever.

 

(g)           Counterparts.
This Lease may be executed in any number of counterparts, each of which when
taken together shall be deemed to be one and the same instrument.

 

(h)           Telefax
Signatures. The parties acknowledge and agree that notwithstanding any law
or presumption to the contrary a telefaxed signature of either party whether
upon this Lease or any related document shall be deemed valid and binding and
admissible by either party against the other as if same were an original ink
signature.

 

(i)            Calculation
of Time. In computing any period of time prescribed or allowed by any
provision of this Lease, the day of the act, event or default from which the
designated period of time begins to run shall not be included. The last day of
the period so computed shall be included, unless it is a Saturday, Sunday or a
legal holiday, in which event the period runs until the end of the next day
which is not a Saturday, Sunday, or legal holiday. Unless otherwise provided
herein, all Notices and other periods expire as of 5:00 p.m. (local time in
Newtown Square, Pennsylvania) on the last day of the Notice or other
period.

 

22

 

(j)            No
Merger. There shall be no merger of this Lease or of the leasehold estate
hereby created with the fee estate in the Premises or any part thereof by
reason of the fact that the same person, firm, corporation, or other legal
entity may acquire or hold, directly or indirectly, this Lease of the leasehold
estate and the fee estate in the Premises or any interest in such fee estate,
without the prior written consent of Landlord’s mortgagee.

 

(k)           Time
of the Essence. TIME IS OF THE ESSENCE IN
ALL PROVISIONS OF THIS LEASE, INCLUDING ALL NOTICE PROVISIONS TO BE PERFORMED
BY OR ON BEHALF OF TENANT.

 

(l)            Recordation
of Lease. Tenant shall not record this Lease without the written consent of

 

Landlord.

 

(m)          Accord
and Satisfaction. No payment by Tenant or receipt by Landlord of a lesser
amount than any payment of Fixed Rent or Additional Rent herein stipulated
shall be deemed to be other than on account of the earliest stipulated Fixed
Rent or Additional Rent due and payable hereunder, nor shall any endorsement or
statement or any check or any letter accompanying any check or payment as Rent
be deemed an accord and satisfaction. Landlord may accept such check or payment
without prejudice to Landlord’s right to recover the balance of such Rent or
pursue any other right or remedy provided for in this Lease, at law or in
equity.

 

(n)           No
Partnership. Landlord does not, in any way or for any purpose, become a
partner of Tenant in the conduct of its business, or otherwise, or joint venturer
or a member of a joint enterprise with Tenant. This Lease establishes a
relationship solely of that of a landlord and tenant.

 

(o)           Guaranty.
In order to induce Landlord to execute this Lease, Tenant agrees that Landlord
may, at its option, at the time of the execution of this Lease or at any time
during the Term, require a guaranty of the obligations of the Tenant hereunder
by a person, firm, corporation, or other entity other than Tenant but with a
business interest in Tenant, acceptable to Landlord, which guaranty shall be in
a form satisfactory to Landlord.

 

(p)           No
Presumption Against Drafter. Landlord and Tenant understand, agree, and
acknowledge that:  (i) this Lease has
been freely negotiated by both parties; and (ii) that, in the event of any controversy,
dispute, or contest over the meaning, interpretation, validity, or
enforceability of this Lease, or any of its terms or conditions, there shall be
no inference, presumption, or conclusion drawn whatsoever against either party
by virtue of that party having drafted this Lease or any portion thereof.

 

(q)           Force
Majeure.     If by reason of strikes
or other labor disputes, fire or other casualty (or reasonable delays in
adjustment of insurance), accidents, orders or regulations of any Federal,
State, County or Municipal authority, or any other cause beyond Landlord’s
reasonable control, Landlord is unable to furnish or is delayed in furnishing
any utility or service required to be furnished by Landlord under the
provisions of this Lease or is unable to perform or make or is delayed in
performing or making any installations, decorations, repairs, alterations,
additions or improvements, or is unable to fulfill or is delayed in fulfilling
any of Landlord’s other obligations under this Lease, no such inability or
delay shall constitute an actual or constructive eviction, in whole or in part,
or entitle Tenant to any abatement or diminution of Rent, except as provided in
section 18(e) hereof, or relieve Tenant from any of its other obligations under
this Lease, or impose any liability upon Landlord or its agents, by reason of
inconvenience or annoyance to Tenant, or injury to or interruption of Tenant’s
business, or otherwise.

 

38.           WAIVER OF TRIAL BY JURY.

 

LANDLORD AND TENANT WAIVE THE RIGHT TO A TRIAL BY JURY
IN ANY ACTION OR PROCEEDING BASED UPON, OR RELATED TO, THE SUBJECT MATTER OF
THIS LEASE. THIS WAIVER IS KNOWINGLY, INTENTIONALLY, AND VOLUNTARILY MADE BY
TENANT AND TENANT ACKNOWLEDGES THAT NEITHER LANDLORD NOR ANY PERSON ACTING ON
BEHALF OF

 

23

 

LANDLORD HAS MADE ANY
REPRESENTATIONS OF FACT TO INDUCE THIS WAIVER OF TRIAL BY JURY OR IN ANY WAY TO
MODIFY OR NULLIFY ITS EFFECT. TENANT FURTHER ACKNOWLEDGES THAT IT HAS BEEN
REPRESENTED (OR HAS HAD THE OPPORTUNITY TO BE REPRESENTED) IN THE SIGNING OF
THIS LEASE AND IN THE MAKING OF THIS WAIVER BY INDEPENDENT LEGAL COUNSEL,
SELECTED OF ITS OWN FREE WILL, AND THAT IT HAS HAD THE OPPORTUNITY TO DISCUSS
THIS WAIVER WITH COUNSEL. TENANT FURTHER ACKNOWLEDGES THAT IT HAS READ AND
UNDERSTANDS THE MEANING AND RAMIFICATIONS OF THIS WAIVER PROVISION AND AS
EVIDENCE OF SAME HAS EXECUTED THIS LEASE.

 

39.           CONSENT TO JURISDICTION.

 

Tenant hereby consents to the exclusive jurisdiction
of the state courts located in Montgomery, Delaware and Philadelphia County and
to the federal courts located in the Eastern District of Pennsylvania.

 

IN WITNESS WHEREOF, the parties hereto have executed this Lease the day
and year first above written.

 

	
  LANDLORD:

  	
  TENANT:

  	
   

  
	
   

  	
   

  	
   

  
	
  353 ASSOCIATES

  	
  GMH MILITARY
  HOUSING, LLC

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
  GH
  353 Associates, Inc., its general partner

  	
   

  	
  By:

  	
  GMH Communities, LP, its sole member

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
  GMH Communities GP Trust, its General Partner

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
  By:

  	
   

  	
   

  
	
  Name: 

  	
  Joseph M. Macchione

  	
   

  	
  Name: 

  	
   

  	
   

  
	
  Title:

  	
  Vice President

  	
   

  	
  Title:

  	
   

  	
   

  
								

 

24

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