Document:

Exhibit 10.4

 

LEASE AGREEMENT

 

This Agreement is
made on 9/23, 2004, between G-C-T CORPORATION, a New Jersey corporation, with
offices c/o Cronheim Management Services, Inc., 205 Main Street, P.O. Box
268, Chatham NJ 07928, as LANDLORD, and LIONVILLE LABORATORIES, INC., a
Delaware corporation, with offices at 208 Welsh Pool Road, Lionville, Uwchlan
Township, Pennsylvania 19353, as TENANT.

 

WITNESSETH THAT the
Landlord does hereby lease to the Tenant and the Tenant does hereby rent from
the Landlord, the premises located at and commonly known as 208 Welsh Pool
Road, Lionville, Uwchlan Township, Chester County, Pennsylvania, together with
all improvements, equipment, fixtures, and appliances owned or controlled by
Landlord and located or to be erected or installed by Landlord thereon; and all
rights, alleys, rights-of-way, easements, appurtenances thereunto belonging or
in anywise appertaining; and all rights of Landlord in and to any public or
private thorofares abutting the above described premises, all being hereafter
referred to as the “demised premises”;

 

for a TERM of TWO (2) YEARS,
COMMENCING on JANUARY 1, 2005 and ENDING on DECEMBER 31, 2006, to be
used and occupied for no other purpose than as offices, light manufacturing,
warehouse and laboratory;

 

UPON THE FOLLOWING
CONDITIONS AND COVENANTS:

 

1:             PAYMENT OF RENT:  The Tenant covenants and agrees to pay to the
Landlord, as rent for and during the term hereof, according to the following
schedule:

 

	
  Lease Year

  	
   

  	
  Rent/Year

  	
   

  	
  Rent/Month

  	
   

  
	
  1

  	
   

  	
  $

  	
  241,020.00

  	
   

  	
  $

  	
  20,085.00

  	
   

  
	
  2

  	
   

  	
  $

  	
  248,250.60

  	
   

  	
  $

  	
  20,687.55

  	
   

  

 

It is the purpose
and intent of the Landlord and Tenant that the net rent shall be net to the
Landlord, so that this lease shall yield, net, to the Landlord, the net rent
specified herein in each ear of the lease. Rent is payable monthly, in advance,
on the first day of each month, to:

 

G-C-T Corporation

c/o Cronheim Management Services, Inc.

P.O. Box 268

Chatham, New Jersey 07928

 

2:             ADDITIONAL RENT BASED UPON LATE
PAYMENT:  If Tenant defaults for more
than ten (10) days in the payment of any monthly installment of fixed
annual rent or additional rent or any of the sums required of Tenant under the
Lease or if Tenant, within ten (10) days after demand from Landlord, fails
to reimburse Landlord for any expenses incurred by Landlord and payable by
Tenant pursuant to the Lease, then Tenant shall pay Landlord, as additional
rent, a late charge of 5% of the rent or expense.

 

3:             INTENTIONALLY OMITTED.

 

 

4:             REAL ESTATE TAXES:

 

(a)           Tenant shall further pay, at its own
cost and expense, all taxes and assessments sewer rents and other governmental
impositions and charges of every kind and nature whatsoever, extraordinary as
well as ordinary, and each and every installment thereof, which shall or may
during the term be charged, laid, levied, assessed, imposed, become due and
payable, or liens upon, or which may arise in connection with the use,
occupancy or possession of the demised premises or any appurtenances or
equipment thereon or therein or any part thereof, or the sidewalks or streets
in front of or adjoining the demised premises and all taxes charged, laid,
levied, assessed or imposed in lieu of or in addition to the foregoing under or
by virtue of all present or future laws, ordinances, requirements, orders,
directions, rules or regulations of the Federal, state, county and
municipal governments and of all other governmental authorities whatsoever. If
at any time during the term of this lease Landlord shall make written demand,
Tenant shall produce and exhibit to the Landlord satisfactory evidence of
payment by Tenant of any such tax assessment, water rent, rate or charge, sewer
charge or other governmental imposition or charge, and said proof or payment
must be delivered to the Landlord not later than twenty (20) days after
Landlord’s written demand therefor. Except as set forth in section (b) of
this article, payments of all aforesaid charges shall be timely made by the
Tenant in order to avoid the assessments of interest, penalties, and other
costs.

 

With respect to assessments
that may be paid in installments, at the option of the payer, Tenant may make
payments in installments rather than in a lump sum. Tenant will be obligated to
pay only the installments due during the term of the lease, including any
extensions thereof.

 

(b)           Tenant shall have the right to
contest or review by legal proceedings, or in such other manner as it may deem
suitable (which, if instituted, Tenant shall conduct at its own expense, free
of any expense to the Landlord and, if necessary, in the name of Landlord), any
tax, assessment, water rent, rate or charge, sewer rent, or other governmental
imposition or charge aforementioned. Tenant may defer payment of a contested
item upon condition that, before instituting any such proceedings, Tenant shall
furnish to Landlord or to any first Mortgagee Landlord may designate, a surety
company bond, a cash deposit, or other security satisfactory to Landlord and
such mortgagee, sufficient to cover the amount of the contested item or items,
with interest and penalties, for the period which such proceedings may be
expected to take, securing payment of such contested items, interest and
penalties, and all costs in connection therewith. Notwithstanding the
furnishing of any such bond or security other than a cash deposit, Tenant shall
promptly pay such contested item or items if at any time the demised premises
or any part thereof shall be in imminent danger of being sold, by an entity
other than the Landlord, its successors or assigns, forfeited, or otherwise lost,
or Landlord shall be subjected to criminal liability for such non-payment. If,
however, Tenant shall have made a cash deposit, in any such event Landlord or
such mortgagee, as the case may be, may pay such contested item or items out of
such deposit. When any such contested item or items shall have been paid or
canceled, any balance of any such cash deposit not so applied shall be repaid
to Tenant without interest. The legal proceedings herein referred to shall
include appropriate proceedings to contest and review tax assessments and
appeals from any judgments, decrees or orders. If there shall be any refund
with respect to any contested items based on a payment by Tenant, Tenant shall
be entitled to the same.

 

(c)           Nothing herein contained shall
require or be construed to require Tenant to pay any inheritance, estate,
succession, transfer, gift, franchise, corporation, income or profit tax or
capital levy that is or may be imposed upon or that is or may be payable by
Landlord, its successors or assigns; provided, however, that in any case where
a tax may be levied, assessed or imposed upon the income arising from the rent
hereunder for the use and occupancy of the demised premises in lieu of or as a
substitute, in whole or in part, for a real estate tax upon the demised
premises and where such tax is a result of a shift of the incidence of taxation
now and ordinarily imposed on realty, Tenant shall pay the same.

 

2

 

(d)           All taxes, charges, costs, and expenses
which Tenant assumes or agrees to pay under any provisions of this lease,
together with all interest and penalties that may accrue thereon in the event
of Tenant’s failure to pay the same as herein provided, and any and all other
sums which may become due by reason of any default of Tenant or failure on
Tenant’s part to comply with the agreements, terms, covenants and conditions of
this lease on Tenant’s part to be performed, and each or any of them, shall be
deemed to be additional rent and, in the event of nonpayment, Landlord shall
have all the rights and remedies herein provided in the case of non-payment of
rent.

 

5:             PROPERTY INSURANCE:

 

(a)           In addition to the rental paid by the
Tenant as set forth herein, Tenant, at its own cost and expense, shall pay for
the property insurance on all buildings and on, in, or appurtenant to the
demised premises at the commencement of the term and thereafter erected thereon
or therein, including all alterations, rebuildings, replacements, changes,
additions and improvements insured against loss or damage by fire, with all
standard extended coverage as may be usually required by any first mortgagee
(and against loss or damage due to war, terrorism or nuclear action if such
insurance shall be available and required by any first mortgagee), in an amount
sufficient to prevent Landlord and Tenant from becoming co-insurers under
provisions of applicable policies of insurance but in any event in an amount
not less than the full insurable value thereof (replacement value and in no
event less than Two million, one hundred thousand ($2,100,000.00) Dollars.

 

(b)           It is understood and agreed that in
addition to the rental to be paid by the Tenant as set fort herein, the Tenant
shall pay and maintain the cost of comprehensive general liability insurance.
Said insurance shall be in the amount of $1,000,000.00 in respect of personal
injury o death to any one person, and not less than $3,000,000.00 in respect of
any one occurrence and not less than $150,000.00 for property damage. These coverage
amounts may be increased from time to time at the sole discretion of the
Landlord in order to afford reasonable protection to both Landlord and Tenant.

 

(c)           During the term, Tenant, at its own
cost and expense, shall provide and keep in force rent insurance in amount not
less than the annual net rent plus the estimated annual taxes, water charges,
sewer rents and installments of assessments and the annual premiums for the
insurance required by this Article 5. Said insurance will cover Landlord’s
loss of rent due to the occurrence of a property loss, as set forth in Article 5
(a).

 

(d)           All insurance provided by Tenant as
required by this Article 5 shall be carried in favor of the Landlord and
Tenant, as their respective interest may appear and Landlord and Landlord’s
mortgagee, if any, shall be an additional named insured. Tenant may carry the
insurance required by this lease under a blanket policy as long as the
insurable interests of both Landlord and Tenant under this lease are clearly
defined and stated. Insurance shall be taken in such responsible companies,
licensed to do business in the Commonwealth of Pennsylvania as Landlord shall
approve, which approval shall not be arbitrarily or unreasonably withheld,
provided the insurance company has a Best rating of “A” or better; and
certificates of the policies therefore shall at all times be held by Landlord,
or, when appropriate, by the holder of any such mortgages, in which case copies
of the policies or certificates of such insurance shall be delivered by Tenant
to Landlord. All such policies shall be non-assessable and shall require not
less than thirty (30) days notice by registered or certified mail to Landlord
of any cancellation thereof or change affecting Landlord’s coverage thereunder.

 

(e)           Wherever herein required, Tenant
shall procure policies for all such insurance for periods of not less than one
year and shall deliver to Landlord such policies or certificates thereof with
evidence of the payment of premiums thereon, and shall procure renewals thereof
from time to time before the expiration thereof so that there is no lapse in
coverage.

 

3

 

(f)            Tenant shall not violate or permit
to be violated any of the conditions or provisions of any such policy, and
Tenant shall so perform and satisfy the requirements of the companies writing
such policies that at all times companies of good standing satisfactory to
Landlord or any mortgagee designated by Landlord, shall be willing to write
and/or continue with such insurance.

 

(g)           Tenant and Landlord shall cooperate
in connection with the collection of any insurance moneys that may be due in
the event of loss, and Tenant shall execute and . deliver to Landlord such
proofs of loss and other instruments which may be required for the purpose of
obtaining the recovery of any such insurance moneys.

 

6:             FIRE AND OTHER CASUALTY:

 

(a)           In case of fire or other casualty,
the Tenant shall give immediate notice to the Landlord. If the premises shall
be partially damaged by fire, the elements or other casualty, and the cost to
repair said damages is $25,000 or less, then Tenant shall be responsible for
making repairs directly. Except as provided in the next sentence, if the cost
to repair such partial damage is more than $25,000, then the Landlord shall
repair the same as speedily as practicable, but in neither case shall the
Tenant’s obligation to pay the rent hereunder cease. If Landlord and Tenant
agree that the premises are so extensively and substantially damaged as to render
them untenantable, then the rent shall cease until such time as the premises
shall be made tenantable by the Landlord. However, if the premises be totally
destroyed or so extensively and substantially damaged that the building cannot
be restored to tenantable condition within 180 days from the date of damage, or
if Landlord has not restored the building to tenantable condition within such
180-day period, then either party may cancel this lease; then the rent shall be
paid up to the time of such destruction and then and from thenceforth this
lease shall come to an end. If the Tenant shall have been insured against any
of the risks herein covered, then the proceeds of such insurance shall be paid
over to the Landlord to the extent of the Landlord’s costs and expenses to make
the repairs hereunder, and such insurance carriers shall have no recourse
against the Landlord for reimbursement. Any disputes regarding these repair and
restoration provisions will be settled by arbitration, in accordance with Article 38.

 

(b)           In the event of loss, the proceeds of
the policies shall be dealt with as follows:

 

i)              In
the event that there shall be a first mortgage on the premises, the loss, if
any, shall be adjusted with the insurance companies and all insurance proceeds
recovered by the mortgagee on account of damage or destruction to the premises
(and all proceeds of any condemnation award recovered by the mortgagee for any
building or equipment taken or damaged), less the cost, if any, to the
mortgagee of such recovery, shall, based upon the written instruction of the
Landlord, be applied by the mortgagee to the payment of the cost of repairing,
restoring or rebuilding the property so damaged or destroyed (or taken),
hereinafter referred to as the “work,” and shall be paid out in accordance with
paragraph (iii) below. The restored building will be of like character and
quality and of value at least equal to the original building existing prior to
the occurrence of the destruction. Landlord represents and covenants that any
existing mortgages or future mortgages have or will have an express provision
allowing, at the option of the Landlord, the use of insurance proceeds for
rebuilding and restoration of the demised premises.

 

ii)             In
the event that there shall not be a mortgage on the premises, the loss, if any,
under any policies provided for in Article 5 shall be adjusted with the
insurance companies:

 

4

 

A)           By Tenant in case of
any particular casualty resulting in damage or destruction not exceeding
Twenty-Five Thousand Dollars ($25,000.00) in the aggregate; or

 

B)            By Landlord and
Tenant, in the case of any such particular casualty resulting in damage or
destruction exceeding Twenty-Five Thousand Dollars ($25,000.00) in the aggregate.

 

iii)            Subject
to the rights of the holder of any mortgage to which this lease is or shall be
subject and subordinate, the proceeds of any such insurance, as so adjusted,
shall be payable as follows:

 

A)           With respect to any loss not
exceeding Twenty-Five Thousand Dollars ($25,000.00) in the aggregate, such loss
shall be paid to Tenant, who shall hold the proceeds in trust for the purpose
of paying the costs of repair and restoration; and

 

B)            With respect to losses exceeding
Twenty-Five Thousand Dollars ($25,000.00) in the aggregate, the loss shall be
paid to Landlord or, if Tenant shall so request, to a commercial bank or trust
company selected by Tenant having a banking office in New Jersey, having a
capital of not less than One hundred Million Dollars ($100,000,000.00), and
supervised by the Comptroller of Currency of the United States or the Banking
Department of the State of New Jersey (such bank or trust company being
hereinafter called the “Insurance Trustee”). All insurance proceeds, less any
cost of recovery, shall be held by the recipient (whether Landlord or the
Insurance Trustee, as the case may be) and shall be applied by such recipient
to pay the costs of repair and restoration.

 

(c)           Increase of Insurance Rates: If for
any reason it shall be impossible to obtain fire and other hazard insurance on
the buildings and improvements on the leased premises, in an amount and in the
form and in insurance companies reasonably acceptable to the Landlord, the
Landlord may, if the Landlord so elects at any time thereafter, terminate this
lease and the term hereof, upon giving to the Tenant fifteen days notice in
writing of the Landlord’s intention so to do, and upon the giving of such
notice, this lease and the term thereof shall terminate.

 

7:             UTILITIES:  In addition to the rent to be paid by Tenant
as set forth in this lease, Tenant shall pay for all utilities consumed by it,
including but not limited to water rents, electric, gas or other heating fuel,
sewer rents, sprinkler supervisory and maintenance charges,

 

8:             PREMISES “AS IS”:  At the commencement of the term, Tenant shall
accept the demised premises and any equipment on or in the demised premises in
their then existing condition and state of repair and Tenant covenants, except
to the extent specifically elsewhere provided, that no representations,
statements or warranties, expressed or implied, have been made by or on behalf
of Landlord in respect thereof, in respect of their condition or the use or
occupancy that may be made thereof, and that the Landlord shall in no event
whatsoever be liable for any latent defects therein, except for guarantees or
warranties expressly stated in separate warranty agreements, if same are
available to Landlord.

 

9:             COMPLIANCE WITH LAWS, ETC.: The
Tenant shall promptly comply with all laws, ordinances, rules, regulations,
requirements and directives of the Federal, State and Municipal Governments or
Public Authorities and of all their departments, bureaus and subdivisions,
applicable to and affecting the said premises, their use and occupancy, for the
correction, prevention and abatement of nuisances, violations or other
grievances in, upon or connected with the said premises, during the term
hereof; and shall promptly comply with all orders, regulations, requirements
and directives of the Board of Fire Underwriters or similar authority and of
any insurance companies which have issued or are about

 

5

 

to issue policies
of insurance covering the said premises and its contents, for the prevention of
fire or other casualty, damage or injury, at the Tenant’s own cost and expense.

 

10:           ASSIGNMENT:  The Tenant shall not assign, mortgage or
hypothecate this lease, nor sublet or sublease the premises or any part
thereof; nor occupy or use the leased premises or any part thereof without the
approval of Landlord, which shall not be unreasonably withheld; nor permit or
suffer the same to be occupied or used for any purposes other than as herein
limited, nor for any purpose deemed unlawful, disreputable, or extra hazardous,
on account of fire or other casualty. Assignment will be permitted to a
subsidiary, or successor corporation by merger.

 

11:           ALTERATIONS AND IMPROVEMENTS:  No alterations, additions or improvements
shall be made, and no climate regulating, air conditioning, cooling, heating or
sprinkler systems, television or radio antennas, heavy equipment, apparatus and
fixtures shall be installed in or attached to the leased premises, without the
written consent of the Landlord, which shall not be unreasonably withheld
provided, however, that Tenant may make interior non-structural alterations or
improvements to the premises without the written consent of the Landlord.
Unless otherwise provided herein, except for Tenant’s trade fixtures and
equipment, all such alterations, additions or improvements and systems, when
made, installed in or attached to the said premises, shall belong to and come s
e property of the Landlord and shall be surrendered with the premises and as
part thereof upon the expiration or sooner termination of this lease, without
hindrance, molestation or injury.

 

12:           INTENTIONALLY OMITTED.

 

13:           INSPECTION AND REPAIR:  The Tenant agrees that the Landlord and the
Landlord’s agents, employees or other representatives, shall have the right to
enter into and upon the said premises or any part thereof, at all reasonable
hours, upon reasonable notice to Tenant, except in the case of an emergency,
for the purpose of examining the same or making such repairs or alterations therein
as may be necessary for the safety and preservation thereof.

 

This is to include
the running of piping, wiring, etc., which the Landlord in its sole judgment
may find necessary for the building of which the demised premises are a part.

 

This clause shall
not be deemed to be a covenant by the Landlord nor be construed to create an
obligation on the part of the Landlord to make such inspection or repairs.
Entry shall be preceded by reasonable prior oral or written notice, except in
case of emergency, and Landlord, its agents, employees, and/or representatives
shall exercise due care an not interfere with the operation of Tenant’s
business to the extent reasonably possible.

 

14:           RIGHT TO EXHIBIT:  The Tenant agrees to permit the Landlord’s
agents, employees, or other representatives to show the premises to persons
wishing to rent or purchase the same, and Tenant agrees that on and after 180
days next preceding the expiration of the term or option period exercised by
Tenant hereof, the Landlord or the Landlord’s agents, employees or other
representatives shall have the right to place notices on the front of said
premises or any part thereof, offering the premises for rent or for sale; and
the Tenant hereby agrees to permit the same to remain thereon without hindrance
or molestation.

 

15:           SIGNS:  The Tenant shall not place nor allow to be
placed any signs of any kind whatsoever upon, in or about the said premises or
any part thereof, except of a design and structure and in or at such places as
may be indicated and consented to by the Landlord in writing. In case the
Landlord or the Landlord’s agents, employees or representatives shall deem it
necessary to remove any such signs in order to paint or make any repairs,
alterations or improvements in or
upon said premises or any part thereof, they may be so removed, but shall be
replaced at the Landlord’s expense when the said repairs,

 

6

 

alterations or
improvements shall have been completed. Any signs permitted by the Landlord
shall at all times conform with all municipal ordinances or other laws and
regulations applicable thereto.

 

16:           NON-LIABILITY OF LANDLORD:  The Landlord, except where caused by the
negligence or intentional conduct of the Landlord, its agents, employees or
contractors, shall not be liable for any damage or injury which may be
sustained by the Tenant or any other person, as a consequence of the failure,
breakage, leakage or obstruction of the water, plumbing, steam, sewer, waste or
soil pipes, roof, drains, leaders, gutters, valleys, downspouts or the like or
of the electrical, gas, power, conveyor, refrigeration, sprinkler,
air-conditioning or heating systems, elevators or hoisting equipment; or by
reason of the elements; or resulting from the carelessness, negligence, or
improper conduct on the part of any other Tenant or this or any other Tenant’s
agents, employees, guests, licensees, invitees, subtenants, assignees or
successors; or attributable to any interference with, interruption of or failure,
beyond the control of the landlord, of any services to be furnished or supplied
by the Landlord.

 

17:           MORTGAGE PRIORITY:  This lease shall not be a lien against the
said premises in respect to any mortgages that may hereafter be placed upon
said premises.

 

The recording of
such mortgage or mortgages shall have preference and precedence and be superior
and prior in lien to this leases, irrespective of the date of recording and the
Tenant agrees to execute any instruments, without cost, which may be deemed
necessary or desirable, to further effect the subordination of this lease to
any such mortgage or mortgages. A refusal by the Tenant to execute such
instruments shall entitle the Landlord to the option of canceling this lease,
and the term hereof is hereby expressly limited accordingly. Landlord agrees to
use its best efforts to obtain from any mortgagee placing a lien on the
premises, a non-disturbance agreement to the effect that, provided Tenant is
not in default under the lease, Tenant may remain undisturbed in possession of
the premises and its leasehold interest will not be terminated by foreclosure.

 

18:           CONDEMNATION AND EMINENT DOMAIN:  If the land and premises leased herein, or
any portion thereof, shall be taken under eminent domain or condemnation
proceedings, or if suit or other action shall be instituted for the taking or
condemnation thereof, then this lease, at the option of the Tenant or Landlord,
shall terminate, and the term hereof shall end as of such date as the Tenant or
Landlord shall fix by notice in writing; and the Tenant shall have no claim
or right to claim or be entitled to any portion of any amount which may be
awarded as damages or paid as the result of such condemnation proceedings or
paid as the purchase price for such option, sale or conveyance in lieu of
formal condemnation proceedings other than any portion of an award attributable
to Tenant’s fixtures or personal property; and all rights of the Tenant to
damages, if any, are hereby assigned to the Landlord. The Tenant agrees to
execute and deliver any instruments, at the expense of the Landlord, as may be
deemed necessary or required to expedite any condemnation proceedings or to
effectuate a proper transfer of title to such governmental or other public
authority, agency, body or public utility seeking to take or acquire the said
lands and premises or any portion thereof. The Tenant covenants and agrees to
vacate the said premises, remove all the Tenant’s personal property therefrom
and deliver up peaceable possession thereof to the Landlord or to such other
party designated by the Landlord in the aforementioned notice. Failure by the
Tenant to comply with any provisions in this clause shall subject the Tenant to
such costs, expenses, damages and losses as the Landlord may incur by reason of
the Tenant’s breach hereof.

 

19:           REMEDIES-UPON-TENANT’S DEFAULT:  If there should occur any default on the part
of the Tenant in the performance of any conditions and covenants herein
contained, or if during the term hereof the premises or any part thereof shall
be or become abandoned or deserted, vacated or vacant, or should the Tenant be
evicted by summary proceedings or otherwise, the Landlord, in addition to any
other remedies herein contained or as may be permitted by law, may either by
appropriate process, without being liable for prosecution therefor, or for
damages, re-enter the said premises and the same

 

7

 

have and again
possess and enjoy; and as agent for the Tenant or otherwise, re-let the
premises and receive the rents therefor and apply the same, first to the
payment of such expenses, reasonable attorney fees and costs, as the Landlord
may have been put to in re-entering and repossessing the same and in making
such repairs and alterations as may be necessary; and second to the payment of
the rents due hereunder. The Tenant shall remain liable for such rents as may
be in arrears and also the rents as may accrue subsequent to the re-entry by
the Landlord, to the extent of the difference between the rents reserved
hereunder and the rents, if any, received by the Landlord during the remainder
of the unexpired term hereof, after deducting the aforementioned expenses, fees
and costs; the same to be paid as such deficiencies arise and are ascertained
each month.

 

20:           TERMINATION ON DEFAULT:  Notwithstanding any of the provisions of Article 19,
upon the occurrence of any’ of the contingencies set forth in the preceding
clause, or should the Tenant be adjudicated a bankrupt, insolvent or placed in receivership,
or should proceedings be instituted by or against the Tenant for bankruptcy,
insolvency, receivership, agreement of composition or assignment for the
benefit of creditors, or if this lease or the estate of the Tenant hereunder
shall pass to another by virtue of any court proceedings, writ of execution,
levy, sale, or by operation of law, the Landlord may, if the Landlord so
elects, at any time thereafter, terminate this lease and the term hereof, upon
giving to the Tenant or to any trustee, receiver, assignee or other person
in.-charge of or acting as custodian of the assets or property of the Tenant,
five days notice in writing, of the Landlord’s intention so to do. Upon the
giving of such notice, this lease and the term hereof shall end on the date
fixed in such notice as if the said date was the date originally fixed in this
lease for the expiration hereof; and the Landlord shall have the right to
remove all persons, goods, fixtures and chattels therefrom, by appropriate
summary process, without liability for damages.

 

21:           REMOVAL OF TENANT’S PROPERTY:  Any equipment, fixtures, goods or other
property of the Tenant, not removed by the Tenant upon the termination of this
lease, or upon any quitting, vacating or abandonment of the premises by the
Tenant, or upon the Tenant’s eviction, shall be considered as abandoned and the
Landlord shall have the right, upon thirty (30) days written notice to Tenant,
to sell or otherwise dispose of the same, at the expense of the Tenant, and
shall not be accountable to the Tenant for any part of the proceeds of such
sale, if any.

 

22:           REIMBURSEMENT OF LANDLORD:  If the Tenant shall fail or refuse to comply
with and perform any such conditions and covenants of the within lease, the
Landlord may, if the Landlord so elects, carry out and perform such conditions
and covenants, at the cost and expense of the Tenant, and the said cost and
expense shall be payable on demand, or at the option of the Landlord shall be
added to the installment of rent due immediately thereafter but in no case
later than one month after such demand, whichever occurs sooner, and shall be
due and payable as such. This remedy shall be in addition to such other
remedies as the Landlord may have hereunder by reason of the breach by the Tenant
of any of the covenants and conditions in this lease contained.

 

23:           NON-PERFORMANCE BY LANDLORD:  This lease and the obligation of the Tenant
to pay the rent hereunder and to comply with the covenants and conditions
hereof, shall not be affected, curtailed, impaired, or excused because of the
Landlord’s inability to supply any service or material called for herein, by
reason of any rule, order, regulation or preemption by any governmental entity,
authority, department, agency, or subdivision or for any delay which may arise
by reason of negotiations for the adjustment of any fire or other casualty loss
or because of strikes or other labor trouble or for any cause beyond the
control of the Landlord.

 

24:           ESTOPPEL CERTIFICATE:  At any time during the term of this Lease and
upon request in writing from the Landlord, the Tenant shall, within fifteen
(15) days from receipt of such notice,

 

8

 

execute an estoppel
certificate in a form reasonably satisfactory to Landlord or mortgagee or
prospective purchaser.

 

25:           LANDLORD’S LIABILITY:  It is understood that the liability of the
Landlord under this lease or under any other agreement, instrument of document
executed in connection with this lease shall be limited to the demised premises
which is the subject of this lease agreement and that the officers,
shareholders, trustees or partners of the Landlord shall be free of any
personal liability in connection with this lease or any such agreement,
instrument or document.

 

26:           LANDLORD/TENANT MAINTENANCE:

 

(a)           Tenant shall, at all times during the
term of this lease and at its own cost and expense, keep and maintain in good
order and condition, the demised premises and the equipment, utilities, and
appurtenances therein or serving the premises and make all repairs thereto as
to the utilities, extraordinary and ordinary, seen and unforeseen, howsoever
the necessity or desirability for repairs may occur, reasonable precautions to
prevent waste, damage, or injury.

 

(b)           The Tenant shall neither encumber nor
obstruct the sidewalks, driveways, yards, entrances, hallways and stairs but
shall keep and maintain the same in a clean condition, free from debris, trash,
refuse, snow and ice.

 

(c)           Landlord will be responsible for-and
will pay for all roof and structural repairs, unless damage to structure or
roof is caused by acts of commission or omission or negligence of the Tenant,
its servants, agents, contractors, servants, or employees, such as, but not
limited to, work or placement of any articles or equipment on roof or to any
other part of structure. “Structural” is defined as exterior walls (not
including doors, windows, or loading docks), structural steel, foundation and
floor slab.

 

27:           AIR CONDITIONING MAINTENANCE:

 

a)             As set forth in Article 26 of
this Lease, Tenant’s agreement to maintain and repair includes all mechanical
equipment such as heating and air conditioning, which are upon or are used in
connection with the leased premises. Tenant agrees to maintain service
contracts during the term of this lease and any extensions thereof with
reputable HVAC contractors to provide regular servicing and maintenance of this
equipment. When requested in writing by the Landlord, the Tenant will furnish a
copy of each service contract. Landlord represents that the HVAC systems, as
well as the plumbing, electrical, and mechanical systems in the demised
premises, will be in good working order at the time of commencement of lease.

 

b)            The Tenant further agrees that it
will not move roof equipment or penetrate the roof with vents, wiring, piping,
etc., unless it first advises the Landlord, so that the Landlord has the
opportunity to inspect and approve the work to protect the structural integrity
of the roof and keep it watertight.

 

28:           MECHANICS AND OTHER LIENS:

 

Tenant shall have
no power to do any act or make any contract which may create or be the
foundation for any lien, mortgage or other encumbrance upon the reversion or
other estate of the Landlord, or upon any interest of Landlord in the demised
premises, it being agreed that, should Tenant cause any alterations,
rebuildings, replacements, changes, additions, improvements or repairs to be
made to the demised premises, or cause any labor to be performed or material to
be furnished therein, thereon or thereto, neither Landlord nor the demised
premises shall under any circumstances be liable for the payment of any expense
incurred or for the value of the work done or material furnished, but all such

 

9

 

alterations,
rebuildings, replacements, changes, additions, improvements and repairs, and
labor and material, shall be made, furnished and performed at Tenant’s expense,
and Tenant shall be solely and wholly responsible to contractors, laborers, and
material men furnishing and performing such labor and material.

 

If, because of any
act or omission (or alleged act or omission) of Tenant, any mechanic’s or other
lien, charge, or order for the payment of money shall be filed against the
demised premises or against Landlord or any conditional bill of sale or chattel
mortgage shall be filed for or affecting any equipment. or any materials used
in the construction or alteration of any improvements (whether or not such
lien, charge order, conditional bill of sale or chattel mortgage is valid or
enforceable as such), Tenant shall, at its own cost and expense cause the same
to be canceled and discharged of record or bonded within ten (10) business
days after notice of filing thereof.

 

29:           BROKER:  Landlord and Tenant each represent that they
have not contacted or dealt with any real estate broker, agent, or salesman
regarding the within and each agrees to save and hold the other harmless from
claims arising out of any alleged breach of the foregoing representations

 

30:           CONFORMATION WITH LAWS AND
REGULATIONS:  The parties may pursue the
relief or remedy sought in any invalid clause by conforming the said clause
with the provisions of the statutes or the regulations of any governmental
agency in such case made and provided, as if the particular provisions of the
applicable statutes or regulations were set forth herein at length.

 

31:           GOVERNMENTAL REGULATIONS/TENANT’S
ENVIRONMENTAL PROVISIONS:

 

a)             Tenant shall, at Tenant’s sole cost
and expense, without notice or demand from Landlord, comply with all the
requirements of all county, municipal, state, federal and other applicable
governmental authorities now in force, or which may hereafter be in force,
pertaining solely to Tenant’s use of the said Demised. Premises and shall
faithfully observe in the use of the Demised Premises all governmental
requirements, including environmental regulations, now in force or which may
hereafter be in force.

 

b)            Tenant shall indemnify Landlord,
save harmless Landlord from all fines, suits, procedures, claims, actions and
costs, including reasonable attorneys’ fees arising out of or in any way
connected with any spills or discharges of hazardous substances or wastes at
the Demised Premises caused by Tenant, its agents or employees and which spills
or discharges occur during the term of this Lease or which may have occurred
during the period of Tenant’s occupancy of the demised premises prior to the
Commencement Date of this Lease, and from all fines, suits, procedures, claims
and actions of any kind arising out of Tenant’s failure to provide all
information, make all submissions and take all actions required by any
regulatory authority. Tenant’s obligations under this Article shall
continue so long as Landlord remains responsible for any spills or discharges
of hazardous substances or wastes at the Demised Premises caused by Tenant, its
agents or employees and which spills or discharges occur during the Term of
this Lease.

 

c)             Landlord shall have the right to
inspect the Demised Premises and in finding any violation(s) by Tenant of said
environmental statutes, acts or regulations, and if the Tenant (upon notice)
does not commence to correct within 30 days, Landlord may cancel this agreement
upon 30 days notice to the Tenant in writing unless sooner required by the
applicable regulatory agency. This right of cancellation is in addition to such
other remedies as the Landlord may have hereunder by reason of the breach by
the Tenant of any of the covenants and conditions in this Lease.

 

10

 

d)            Any effluent generated by operation
of Tenant’s business will be treated by Tenant so that contents of sewage will
comply with standards set by local, state or federal environmental agencies and
applicable laws and regulations. Tenant will supply Landlord with such
certifications which may be required by the aforesaid agencies and will hold
the Landlord harmless and will defend the landlord against any future claims or
suites arising out of the conduct of Tenant’s business.

 

32:           VALIDITY OF LEASE:  The terms, conditions, covenants and
provisions of this lease shall be deemed to be severable. If any clause or
provision herein contained shall be adjudged to be invalid or unenforceable by
a court of competent jurisdiction or by operation of any applicable law, it
shall not affect the validity of any other clause or provision herein, but such
other clauses or provisions shall remain in full force and effect.

 

33:           NON-WAIVER BY LANDLORD:  The various rights, remedies, options and
elections of the Landlord, expressed herein, are cumulative, and the failure of
the Landlord to enforce strict performance by the Tenant of the conditions and
covenants of this lease or to exercise any election or option or to resort or
have recourse to any remedy herein conferred or the acceptance by the Landlord
of any installment of rent after any breach by the Tenant, in any one or more
instances, shall not be construed or deemed to be a waiver or a relinquishment
for the future by the Landlord of any such conditions and covenants, options,
elections, or remedies, but the same shall continue in full force and effect.

 

34:           NOTICES:  All notices required under the terms of this
lease shall be given and shall be complete upon personal delivery or three days
after mailing such notices by certified or registered mail, return receipt
requested, to the address of the parties as shown at the head of this lease, or
to such other address as may be designated in writing, which notice of change
of address shall be given in the same manner.

 

35:           TITLE AND QUIET ENJOYMENT:  The Landlord covenants and represents that
the Landlord is the owner of the premises herein leased and has the right and
authority to enter into, execute and deliver this lease; and does further
covenant that the Tenant on paying the rent and performing the conditions and
covenants herein contained, shall and may peaceably and quietly have, hold, and
enjoy the leased premises for the term aforementioned.

 

36:           ENTIRE CONTRACT:  This lease contains the entire contract
between the parties. No representative, agent or employee of the Landlord has
been authorized to make any representations or promises with reference to the
within letting or to vary, alter or modify the terms hereof. No additions,
changes or modifications, renewals or extensions hereof, shall be binding
unless reduced in writing and signed by the Landlord and the Tenant.

 

37:           MISCELLANEOUS:  In all references herein to any parties,
persons, entities or corporations, the use of any particular gender or the
plural or singular member is intended to include the appropriate gender or
member, as the text of the within instrument may require. All the terms,
covenants and conditions herein contained shall be for and shall inure to benefit
of and shall bind the respective parties hereto, and their heirs, executors,
administrators, personal or legal representatives, successors and assigns.

 

38:           ARBITRATION:

 

(a)           In such cases where this lease
provides for the settlement of disputes by arbitration, the same shall be
settled by arbitration in Chester County, Pennsylvania in accordance with the
rules, then

 

11

 

obtaining, of the
American Arbitration Association, and judgment upon the award rendered may be
entered in any court having jurisdiction thereof.

 

(b)           In the event that either of the
parties shall have any dispute and it shall invoke this arbitration clause, no
action shall be deemed effective under the terms of this lease until the determination
of the arbitrators shall have been final and a judgment thereon shall. have
been served upon the party against whom action shall be taken or invoked.

 

39:           HOLDING OVER:  In the event that Tenant shall remain in the
demised premises after the expiration of the term of this lease without having
executed a new written lease with the Landlord, such holding over shall not
constitute a renewal or extension of this lease. The Landlord may, at its
option, elect to treat the Tenant as one who has not removed at the end of his
term and thereupon be entitled to all the remedies against the Tenant provided
by law in that situation, or the Landlord may elect, at its option, to construe
such holding over as a tenancy from month to month, subject to all the terms and
conditions of this lease, except as to duration thereof.

 

40:           SURRENDER OF PREMISES:

 

(a)           Tenant covenants and agrees to
deliver up and surrender to the Landlord possession of the demised premises
upon expiration of this lease, or its earlier termination as herein provided,
broom clean and in as good condition and repair as the same shall be at the
commencement of the term of this Lease, or may have been put by the Landlord
during the continuance thereof, ordinary wear and tear and damage by fire or the
elements excepted. Tenant shall also surrender all keys for the Demised
Premises, as well as all building drawings and environmental reports of any
kind relating to the Demised Premises. The foregoing shall require that Tenant
cause the following (which is not an exclusive list) to be true as of the date
of surrender, to the extent such condition existed at the date of occupancy:

 

a.                                      All interior and exterior
lights are operational and burning.

 

b.                                      All exhaust, ceiling and
overhead fans are operational.

 

c.                                       Warehouse floor is broom
swept and clean of all trash and materials.

 

d.                                      Warehouse floor is cleaned
of excessive oils, fluids and other foreign materials.

 

e.                                       All electrical, plumbing,
and other utilities which are terminated are disconnected, capped and/or
terminated according to applicable building codes and all other governmental requirements.

 

f.                                          All electrical conduit and
wiring installed by Tenant specifically for Tenant’s equipment are removed to
originating electrical panel if Landlord so requires.

 

g.                                      Overhead interior and
exterior doors are operational and in good condition.

 

h.                                      Any bolts secured to floor
are cut off flush and sealed with epoxy.

 

i.                                         Warehouse fencing or
partitions installed by Tenant are removed if Landlord so requires.

 

j.                                          All furniture, trash and
debris are removed.

 

12

 

k.                                      All pictures, posters,
signage, stickers and all similar items are removed from all walls, windows,
doors and other interior and exterior services of the Premises.

 

l.                                         Carpet areas are vacuumed.

 

m.                                    All uncarpeted office floors
are swept, and any excess wax buildup on tile and vinyl floors is removed.

 

n.                                      All Tenant-installed
computer cable is removed to point of origin.

 

o.                                      All doors, windows and
miscellaneous hardware are operational.

 

p.                                      All heating, air
conditioning and mechanical equipment is operational and in good working
condition.

 

q.                                      Ceiling tiles, grid, light
lenses, air grills and diffusers are in place with no holes or stains.

 

r.                                        There are no broken windows
or other glass items.

 

s.                                        Bathroom, walls, floors, and
fixtures are clean.

 

t.                                         All plumbing fixtures are
intact and operational and do not leak.

 

u.                                      All downspouts are undamaged
and operational.

 

v.                                       Walls (internal and
external) are clean and any holes are properly and permanently patched.

 

w.                                    Parking lot is in good
condition with no potholes or cracked/alligatored surfaces.

 

x.                                       Sidewalks and concrete
aprons are in good condition with no broken surfaces or holes.

 

(b)           Within thirty (30) days of Tenant’s
receipt of written request from the Landlord, the Tenant shall, at Tenant’s
expense, remove all property of Tenant and repair all damage to the Demised
premises caused by such removal and restore the Demised Premises. Any property
not so removed shall be deemed to have been abandoned by Tenant and may be
retained or disposed of by Landlord, as Landlord shall desire. Tenant will
remove special piping, wiring and ductwork installed above hung ceilings for
Tenant’s operations. Tenant’s obligation to observe or perform this covenant
shall survive the expiration of the term of this Lease.

 

41:           TENANT’S WORK:  Within ninety (90) days of execution of this
Lease, Tenant will repair broken sidewalks and curbs at the demised premises.

 

13

 

IN WITNESS WHEREOF,
the parties hereto have hereunto set their hands and seals or caused these
presents to be signed by their proper corporate officers and their proper
corporate seal to be hereto affixed, the day and year first above written.

 

	
   

  	
  LANDLORD:

  
	
   

  	
  G-C-T CORPORATION

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Robert Cronheim

  	
   

  
	
   

  	
   

  	
  Robert Cronheim, President

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  TENANT:

  
	
   

  	
  LIONVILLE LABORATORIES, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Carter
  Nulton

  	
   

  
	
   

  	
   

  	
  Carter
  Nulton

  
					

 

14Exhibit 10.5

 

LEASE AGREEMENT

BETWEEN

J.W. GIBSON CONSTRUCTION COMPANY

AND

TMA/EBERLINE

601-B SCARBORO ROAD

OAK RIDGE, TN 37830

 

1.  PARTIES

 

THIS INDENTURE OF
LEASE, made and entered into this the 24th day of October, 2000, by and between
J.W. GIBSON CONSTRUCTION COMPANY, of Oak Ridge, Anderson County, Tennessee,
hereinafter called “Lessor”, and Eberline Analytical Corp., of Albuquerque,
Bernalillo County, New Mexico, hereinafter called “Lessee”.

 

2.  CONSIDERATION

 

That each of the
aforesaid parties hereto acknowledges the receipt of one dollar and other
valuable considerations paid by Lessee to Lessor, and that they and each of
them, in further consideration of the engagements and mutual covenants of the
other as herein stated agree as follows:

 

3.  PREMISES

 

A.            The Lessor has and does hereby
grant, demise and lease unto the said Lessee, those certain premises (the “Premises”) consisting of
approximately 10,000 square feet of administrative, laboratory and storage type
space within the entire building situated upon approximately 1.85 acres of land
being approximately 16.5% of Lessor’s parcel and being addressed as 601-A
Scarboro Road, Oak Ridge, TN. Demised premises is furthermore set out in the
attached “Exhibit A”.

 

B.            Lessee, its employees, guests, and invitees
shall have the right of common usage for egress to and egress from the
premises.

 

C.            During the duration of the lease,
Lessee may install, at Lessee’s own expense, any improvements desired or needed
by the Lessee, inside or outside of the respective buildings located on
premises subject to Lessor approval, which approval shall not be unreasonably
withheld.

 

D.            Upon the expiration of the lease
either at its normal termination, at the end of any extension, termination
because of default or early termination pursuant to Article 6, the Lessee
shall immediately quit the Premises. All improvements except trade fixtures
shall remain and the Lessee shall repair any material damage to Premises
excepting normal wear and tear, fire, explosion, extended coverage endorsement
perils as defined by the standard insurance company policy form and events
beyond the control of Lessee. Trade fixtures are defined as items of personal
property used by Lessee in its business operations and shall specifically
exclude partitions, heating and air-conditioning equipment, water fountains,
toilets, plumbing and electrical equipment and the like which although
installed by Lessee are nevertheless a usual fixture and/or appurtenance to the
building. If any structural damage is

 

 

caused in removing
trade fixtures, Lessee shall promptly repair such damage. If applicable, Lessee
specifically promises to remove radioactive and/or contaminated materials from
the Premises at the expiration of the lease to the extent necessary to have the
premises declared acceptable for unrestricted use as defined by the State of
Tennessee Department of Health and Environment, Division of Radiological
Health.

 

E.             Notice is hereby given the Lessor
shall not, under any circumstances; be liable to pay for any work, labor or
services rendered or materials furnished to or for the account of Lessee or
anyone holding the Premises or any part thereof by, through or under Lessee
upon or in connection with the Premises, and that no mechanics’ or other lien
for work, labor or services rendered or material furnished to or for the
account of Lessee or anyone holding the Premises or any part thereof by,
through or under Lessee, shall under any circumstances, attach to or affect the
Premises or any part thereof or the interest of Lessor therein. All such work,
labor, services or material shall be rendered or furnished at the expense of
Lessee, and Lessee shall be solely and wholly responsible therefor and shall
hold Lessor and the Premises harmless against the same.

 

F.             Lessee shall not suffer or permit
any liens to stand against the Premises or any part thereof, or the interest of
Lessor therein, by reason of any work, labor, services or material done for or
supplied to, or claimed to have been done for or supplied to, Lessee or anyone
holding the premises, or any part thereof, through or under Lessee. If Lessee
shall fail to discharge any such liens within sixty (60) days after demand from
Lessor, then in addition to any other right or remedy of Lessor, Lessor may,
but shall not be obligated to, discharge the same in any manner permitted by
law.

 

Any amount paid or
deposited by Lessor for such purpose and all legal and other expenses of
Lessor, including attorney fees incurred in procuring the discharge of such
lien, with all necessary disbursements in connection therewith, together with
interest at the prime rate of interest charged by Bank of Boston, plus 2 % per
annum (the “Default Rate”) from the date of payment of deposit shall become due
and payable forthwith by Lessee to Lessor.

 

4.  PURPOSE

 

The demised
Premises are leased by Lessor to Lessee for the purpose of routine office,
administrative, and analytical type uses and any use deemed appropriate to the
operation of Lessee’s business. Any such uses shall comply fully with any
current zoning regulations or any amendments thereof.

 

5.  TERM

 

A.            The initial term of this lease shall
be for a term of 5 consecutive years, beginning October 1, 2000, unless
sooner terminated as provided for herein.

 

B.            Lessee shall have the right and
option to extend said lease term for a period of an additional 5 year term at a
mutually agreeable rental rate, as determined not later than 120 days prior to
lease expiration by providing Lessor with written notice of intent to do same,
such notice to be provided to Lessor at the address where basic rents are paid
not less than ninety (90) days and not more that one hundred eighty (180) days
before the expiration of the term of this lease.

 

C.            Lessor agrees to keep Lessee in
peaceable, uninterrupted possession of Premises so long as Lessee complies with
and performs all of the terms, covenants and conditions of this Lease
Agreement.

 

2

 

6.  RIGHT TO TERMINATE NOT EXCLUSIVE

 

The right of the
Lessor to terminate this Lease Agreement as herein set forth is in addition to
and not in exhaustion of such other rights that the Lessor has or causes of
action that may accrue to the Lessor because of Lessee’s failure to fulfill,
perform or observe the obligations, agreements, or covenants of this Lease
Agreement, and the exercise or pursuit by the Lessor of any of the rights or
causes of action accruing hereunder shall not be in exhaustion of such other
rights or causes of action that the Lessor might otherwise have.

 

7.  RENTAL

 

A.            Lessee shall and hereby agrees to
pay to Lessor at Lessor’s office or such place as Lessor may from time to time,
designate in writing, an annual base rental of $84,996 Dollars. The rent shall
be in equal monthly installments, each installment being 1/12th of the annual
base rental. The monthly rate shall be $7.083 Dollars.

 

B.            In addition to the base rental,
Lessee shall pay Lessor the direct cost of all real property taxes net of any
abatement, real property insurance, and other real property assessments net of
any abatement prorated in accordance with the effective fractional space
defined in Article 3. Lessor shall submit to Lessee paid receipts or
similar documentation of these costs prior to December 31st of each year
of this lease term and Lessee agrees to reimburse Lessor within 30 days of the
receipt of the billing. Expenses for the first and last year of the lease shall
be apportioned between Lessor and Lessee based on actual period of occupation.

 

The term “Real
Estate Taxes”
shall in no event be deemed to include any income, excess profits, excise,
franchise, estate, succession, inheritance, gift, mortgage lien, documentary
stamp or transfer taxes. If Lessor shall obtain any abatement, refund or rebate
in Real Estate Taxes theretofore paid by Lessee under this Lease, Lessor shall
promptly forward to Lessee Lessee’s Pro Rata Share thereof, less Lessee’s Pro
Rata Share of the cost obtaining the same. Lessor covenants and agrees that it
shall timely and fully pay to the applicable taxing authority all Real Estate
Taxes levied against the Property. Lessee shall not, in any event be liable for
any interest or penalty charges payable by Lessor with respect to the Real
Estate Taxes. Notwithstanding anything to the contrary contained in this Lease,
in the event that Lessee is obligated to pay any portion of any betterment or
special assessment Lessee’s payments shall be calculated as if such assignment were
amortized on a straight-line basis consistent with generally accepted
accounting principles consistently applied (“GAAP”), such that Lessee shall pay
a total amount equal to Lessee’s Pro Rata Share of such assessment multiplied by a
fraction, the numerator of which is the number of years remaining in the Tern
and the denominator of which is the greater of (a) the number of years in
the entire Tern or (b) the number of years for amortization indicated by
GAAP.

 

C.            It is expressly understood and
agreed that no act, practice or custom on the part of Lessor with respect to
giving notice to Lessee of the time that monthly rental payments are due shall
ever be construed as an obligation on the part of Lessor to give such notice to
Lessee.

 

D.            The burden of proof of payment of
the rental or any other sum due Lessor hereunder shall be on the Lessee.

 

E.             The first payment of rent shall be
due on the first day of the month following the month that the obligations
expressed herein become effective, and subsequent payments due on the like day
of subsequent months.

 

3

 

8.  ASSIGNMENT AND SUBLETTING

 

Lessee covenants
and agrees not to assign this Lease Agreement or sublet the demised Premises or
any part of same, or in any other manner transfer the lease agreement,
leasehold or demised Premises, without the written consent of the Lessor, which
consent shall not be unreasonably withheld.

 

Notwithstanding
anything to the contrary contained in this Lease, Lessee shall have the right
to make, without Lessor’s consent, any assignment of this Lease or subletting
of all or any portion of the Premises to (a) a parent, subsidiary, or
division of Lessee, (b) any entity with which or into which Lessee may
consolidate or merge, or ( c ) any entity acquiring all or substantially all of
the assets of Lessee. In the event of any such assignment, Lessee shall
promptly and within 10 days give notice to Lessor of any such assignment.

 

In the event Lessor
consents to a subletting or assignment, Lessee shall, nevertheless, remain
liable for the payment to Lessor of all slims due Lessor hereunder, and remain
responsible for compliance with all of the terms and conditions of this Lease
Agreement. Any consent given by Lessor to a subletting or an assignment shall
not be deemed a consent to a subsequent subletting or assignment.

 

9.  LAWFUL AND MORAL USE

 

Lessee covenants
that the demised Premises shall, during the term of this Lease Agreement, be
used only and exclusively for lawful and moral purposes, and that no part of
the demised Premises shall be used by Lessee or any persons holding by, through
or under Lessee in any manner whatsoever for any purpose(s) which violate the
laws of the United States, the State of Tennessee, the County of Anderson, the
ordinance of the City of Oak Ridge, or the laws of any other applicable governmental
authority; and the Lessee shall save and hold Lessor harmless for all loss,
cost, expenses and damages incurred by Lessor or which Lessor should become
liable for an account of any such violation.

 

10.  INTERPRETATION AND CONSTRUCTION

 

This lease shall be
interpreted under the laws of the State of Tennessee.

 

11.  ENTIRE AGREEMENT

 

This lease contains
all the agreements and conditions made between the parties hereto, and no
representations or statements claimed to have been made and not herein contained
shall vary or modify this contract in any way and this lease cannot be modified
except as the parties agree in writing.

 

12.  CONDEMNATION

 

If the whole or
substantially the whole of the Premises shall be lawfully condemned or taken in
any manner for any public or quasi public use or purpose, this tease shall
terminate as of the date of the taking. If less than the whole or substantially
the whole Premises are taken and it is still feasible for Lessee to operate its
business, the base rental shall be diminished by the amount representing the
part of said rent properly applicable to the portion of the Premises which may
be so taken and the Lessor shall at his expense proceed with reasonable
diligence to repair, alter and restore the remaining part of the Premises to
substantially its former condition to the extent that the same may be feasible.
The Lessor shall be entitled to receive the award in any condemnation
proceeding, including any award for the value of any unexpired term of this
lease and Lessee shall have no claim against Lessor or against the proceeds of

 

4

 

the condemnation.
Nothing contained herein shall affect Lessee’s right to a separate award for it’s
trade fixtures and moving expenses.

 

13.  NUISANCES

 

Lessee covenants
not to create or allow any nuisance to exist in, from, on or about the demised
Premises, and Lessee covenants to immediately at his expense abate any such
nuisance that may arise when requested by Lessor to do so.

 

14.  SUBORDINATION

 

This lease shall be
subordinate to any first mortgage and extensions thereto, now or hereafter
placed upon the land upon which the Premises are located and in the event of
foreclosure of such first mortgage, the exercise of a power of sale thereunder,
or deed in lieu of foreclosure, Lessee shall attorn to and recognize such
purchaser, foreclosure, sale or other transfer as the Lessor; provided that in
each case such shall not disturb Lessee’s right to possession or its other
rights hereunder so long as Lessee complies with the terms of this lease.

 

15.  INSURANCE

 

A.            Lessee covenants and agrees that,
during the term of this lease, it will carry, at its expense, property
insurance covering against loss or damage of Lessee’s improvements on the
Premises and such insurance shall be in the kind and amounts customarily
maintained by Lessee for such property.

 

B.            Lessee covenants and agrees to
carry, during the term of the lease, at Lessee’s expense:

 

1.             Workers Compensation Insurance on
Lessee’s employees; and

 

2.             Public liability and property
damage insurance coverage insuring Lessee with minimum coverage limits for
public liability insurance of $2,000,000 for one person in respect to one
accident and for more than one person in respect to any one accident, and for
property damage insurance a limit of $2,000,000 each accident. Lessor will be
included as an additional insured but only as regards to liability arising out
of the fault or negligence of Lessee in its use or occupancy of the Premises.

 

C.            Lessee covenants and agrees not to
do or permit anything to be done or anything to remain on the Premises, not to
permit any business, trade, or occupation to be carried on in the Premises,
which causes or may cause an increase or additional premium for the fire and extended
coverage insurance on the Premises without the written consent of Lessor, and
if Lessee’s actions do cause an increase in the premium, Lessee shall pay such
additional premiums.

 

Lessee agrees to
obtain, at its expense, adequate insurance related to the nature of the
business. Certificates of nuclear liability insurance will be provided upon
request.

 

D.            Lessee agrees to deliver to Lessor
on the inception date and on renewal date of each such policy of insurance that
Lessee is required to carry by the terms of this Lease Agreement the usual
certificate issued by the insurance carriers certifying that such insurance is
in full force and that all such policies shall not be canceled without ten (10) days
written notice to Lessor.

 

E.             If the Premises shall be so damaged
or destroyed by fire or other causes within the insurance coverage of Lessor’s
standard fire and extended coverage insurance policy and Lessor cannot

 

5

 

repair or rebuild
same within ninety (90) days from the date of such damage or destruction, this
lease shall terminate and the Lessee shall be allowed an abatement of all rent
from the date of such damage or destruction. If the Premises shall be so
damaged or destroyed by fire or other causes within the insurance coverage of
Lessor’s standard fire and extended insurance coverage policy that it can be
repaired within ninety (90) days of the date of such damage or destruction,
then this lease shall not terminate and the Premises shall be repaired by the
Lessor, at its own expense, and the rent shall abate until such repair or
rebuilding is completed and possession of the Premises or so much thereof as
shall have become untenable is returned to the Lessee; provided that subject to
Force Majeure, if the reparation and rebuilding is not so completed within said
Ninety (90) day period, Lessee may terminate this lease by notice given within
one hundred twenty (120) days of such damage or destruction.

 

F.             If the Premises shall be damaged or
destroyed by causes not within the coverage of the Lessor’s above-mentioned
fire and extended coverage insurance and not arising out of the Lessee’s use
and occupancy, then rent will abate and if Lessor does not within thirty (30 )
days after such damage or destruction commence to repair or rebuild the demised
Premises, either party may terminate this Lease Agreement by notice to the
other of said termination. If the Lessor repairs or rebuilds the demised
Premises, this Lease Agreement shall not so terminate, provided Lessor
diligently pursues and completes same within ninety (90) days form the
commencement of repair or rebuilding subject to delays beyond Lessor’s
reasonable control. Until rebuilding or repairs are completed the rent shall be
abated.

 

G.            In the event of repair or
rebuilding, the terms of this Lease Agreement shall be extended for a period
equal to such period of rent abatement.

 

H.            Lessee shall in case of any damage
or destruction not otherwise known to Lessor, give immediate notice thereof to
the Lessor. Lessor shall within thirty (30) days after such damage or
destruction give written notice to Lessee whether Lessor can or will repair and
restore within the time period as herein provided. Failure to give such notice
shall be deemed notice that Lessor cannot or will not repair and restore.

 

I.              Lessor agrees to maintain fire and
extended coverage insurance at the full replacement cost of the building.
Lessor agrees to deliver to Lessee on this inception date and on renewal date
of each such policy of insurance that Lessor is required to carry by the terms
of this Lease Agreement the usual certificate issued by the insurance carriers
certifying that such insurance is in full force and that all such policies
shall not be canceled without ten (10) days written notice to Lessee.

 

16.  DAMAGES. ACCIDENTS. ETC.

 

Notwithstanding
anything to the contrary contained in this Lease, Lessee shall indemnify and
hold harmless Lessor from and against any and all damages, liabilities,
actions, causes of action, suits, claims, demands, losses, costs and expenses (
including without limitation reasonable attorneys’ fees and disbursements and
court costs ) to the extent arising from or in connection with the negligence
or willful misconduct of Lessee, its agents, employees, representatives or
contractors.

 

Notwithstanding
anything to the contrary contained in this Lease, Lessor shall indemnify and
hold harmless Lessee, its parent, subsidiaries and affiliates, and their
respective officers, directors, shareholders and employees, from and against
any and all damages, liabilities, actions, causes of action, suites, claims
demands, losses, costs and expenses (including without limitation reasonable
attorneys’ fees and disbursements and court costs ) to the extent arising from
or in connection with the negligence or willful misconduct of Lessor, its
agents, employees, representatives or contractors.

 

6

 

The party seeking
indemnification under this Section (the ‘Indemnified Party”) shall provide
prompt written notice of any third party claim to the party from whom
indemnification is sought (the “Indemnifying Party”). The Indemnifying Party
shall then have ten (10) days to elect, by written notice to the
Indemnified Party, to assume, at the Indemnifying Party’s expense, exclusive
control of the defense of such claim. The Indemnified Party agrees to cooperate
reasonably with the Indemnifying Party in connection with the performance of
the Indemnifying Party’s obligations under this Section.

 

Notwithstanding
anything to the contrary contained in this Lease, in no event shall either
party be liable to the other for any indirect, special, consequential or
incidental damages (including without limitation damages for loss of use of
facilities or equipment, loss of goodwill or loss of revenue other than the
rent, additional rent and other charges payable by Lessee under, this Lease)
regardless of whether such party has been informed of the possibility of such
damages or is negligent.

 

The provisions of
this Section shall survive the expiration or earlier termination of this
Lease.

 

17.  INSOLVENCY, ETC. OF LESSEE

 

In the event of
insolvency or bankruptcy of the Lessee, or the filing of any petition under any
provision of the Bankruptcy Act or State insolvency laws against Lessee,
whether voluntarily or involuntarily, or in the event of a partial or general
assignment by Lessee for the benefit of Lessee’s creditors, or in the event
Lessee files a petition for an arrangement or composition under the provisions
of the Bankruptcy Act, Lessor shall have the right and privilege to immediately
terminate this Lease Agreement and declare the then remaining unpaid balance of
the rental due for the remainder of the term, as if same were not terminated,
immediately due and payable. Lessor shall have the right with or without legal
process to immediately reenter into possession of the Premises.

 

Without limiting
the preceding paragraphs, no interest of Lessee in this lease shall be
assignable by operation of law. Each of the following acts shall be considered
an involuntary assignment:

 

A.            If Lessee is adjudicated bankrupt or
insolvent, makes an assignment for the benefit of creditors, or institutes a
proceeding under the Bankruptcy Act in which Lessee is the bankrupt; and

 

B.            If a writ of attachment or execution
is levied on this lease and such attachment is not removed within forty-five
(45) days of such levy; and

 

C.            If, in any proceeding or action to
which Lessee is a party, a receiver is appointed with authority to take
possession of the Premises and the appointment of such receiver is not vacated
within forty-five (45) days after such appointment.

 

An involuntary
assignment shall constitute a default by Lessee and Lessor shall have the right
to terminate this lease, in which case the lease shall not be treated as an
asset of Lessee.

 

18.  COVENANT TO SURRENDER

 

Upon the expiration
or termination of this lease. Lessee shall quit and surrender the Premises to
Lessor in good condition and repair, normal wear and tear, acts of God, the
elements and casualty damage excepted.

 

19.  RIGHT OF ENTRY: INSPECTION AND SHOWING

 

With reasonable
notice to Lessee, Lessor or Lessor’s agent shall have the right to enter the
Premises during Lessee’s normal business hours to examine the same and to show
them to prospective mortgagees or purchasers of the Premises during the term
thereof, and during the last four (4) months of the term to show them to
prospective lessees. With reasonable notice to Lessee, Lessor or Lessor’s agent

 

7

 

may also enter the
Premises for the purpose of inspecting for damages or for making any repairs
required to be made by it under the terms of this lease, and also to make any
repairs required to be made by Lessee under this lease and which Lessee has not
made or refuses to make. With reasonable notice to Lessee and when accompanied
by Lessor or Lessor’s agent, any mortgagee of the Premises shall have the right
to inspect the Premises during Lessee’s normal business hours. Any such entry
may be made without Lessor or Lessor’s agents being deemed guilty of trespass
and without the same constituting any eviction of Lessee, in whole or in part.
Nothing herein contained shall be deemed or construed to impose on Lessor any
obligation, responsibility or liability whatsoever, for the care, supervision
or repair of the Premises or any part thereof other than as herein provided.
Lessor or Lessor’s agents shall also be allowed to take all material and
necessary tools and equipment into and upon the Premises that may be required
for the aforesaid repairs and the rent reserved shall in no way abate while any
such repairs are being made.

 

19.  DEFAULT

 

A.            All covenants and agreements herein
made and obligations assumed are to be construed also as conditions and are
upon the express condition that if Lessee shall fail to pay when due any one of
the aforesaid installments of rent or any other monetary obligations hereunder,
or if Lessee shall fail or refuse to perform or observe any of the covenants,
agreements or obligations herein made or assigned by said Lessee, and if such
default is continued for ten (10) days (in the case of rent or other
monetary obligations) or sixty (60) days (in the case of other covenants,
agreements or obligations herein made or assumed by Lessee) after Lessee’s
receipt of written notice from Lessor specifying the respects in which Lessee
is in default hereof, then and thenceforth so long as such default is not
cured, in any of said events, (i) this Lease Agreement may be terminated
at the option of the Lessor, and said Lessor may immediately at or anytime
thereafter,(ii) re-enter into possession of the Premises, or any part
thereof in the name of the whole, with or without resort to legal process from
any court, and (iii) to declare the then remaining unpaid balance of the
total rental due for the remainder of the term, as if the same were not so
terminated, immediately due and payable.

 

B.            If Lessee is dispossessed form the
Premises and this lease is terminated by Lessor under the provisions of
paragraph A of this article 20, Lessor may, at its option, relet same for
such period or period as Lessor deems advisable (whether for the entire residue
of the term or for a shorter or longer period) and upon the best rent and terms
that Lessor, by the exercise of reasonable diligence, is able to obtain.
Whether or  not
the Premises are relet, Lessee shall remain liable hereunder, until the time
originally fixed for expiration of the term hereof, for the rent reserved hereunder
less the net avails of any reletting, if any, after deducting therefrom all
expenses incurred by Lessor of obtaining possession (including reasonable
attorney’s fees), reletting, collection and necessary repairs and alterations;
and the same shall be due and payable by Lessee on the first day of each month
from and after the first day of each of said months from and after such date,
Lessee will, upon receiving a statement of the net avails of releasing, if any,
pay to the Lessor the amount of deficiency than existing. Notwithstanding the
foregoing, Lessor agrees to use commercially reasonable efforts to relet the
premises and mitigate its damages.

 

C.            Any item, other than rent, which
Lessee is obligated to pay Lessor hereunder, shall, at the option of Lessor, be
treated as additional rent due hereunder, and Lessor, in addition to any other
rights or remedy Lessor may have shall have the same right and remedies for
non-payment thereof as for non-payment of rent.

 

D.            The specific remedies to which Lessor
or Lessee may resort under the terms of this lease are cumulative and not
intended to be exclusive of any other remedies or means or redress to which
Lessor may be lawfully entitled in case of any breach or threatened breach by
Lessee of any provision of this lease.

 

8

 

E.             In addition to any and all other
rights and remedies to which the parties may be entitled, the parties shall be
entitled to the restraint by injunction of any violation or attempted or threatened
violation of any of the terms, covenants, conditions, provisions or agreements
of this lease.

 

F.             In the event of any action at law
or in equity between Lessor and Lessee to enforce any of the provisions and/or
rights hereunder, the unsuccessful party of this litigation covenants and
agrees to pay to the successful party all costs and expenses, including
reasonable attorney’s fees incurred therein by such successful party, which
shall be included in and as part of such judgment. Should either Lessor or
Lessee by reason of this lease and without fault on its part, be made a party
to any litigation instituted by or against the other, then said party so named
as a party to said litigation shall be entitled to receive from the other party
all costs, expenses and reasonable attorney’s fees incurred in or. in
connection with such litigation.

 

G.            Lessee hereby expressly waives any
and all rights of redemption granted by or under any present or future laws in
the event of Lessee’s being evicted or dispossessed for any cause, or in the
event of Lessor’s obtaining possession of demised Premises by reason of the
violation by Lessee of any of the covenants and conditions of this lease or
otherwise.

 

21.  REPAIRS AND WARRANTY

 

A.            Lessee will be responsible for repairs
to the cement floor due to cracking, splitting, or disintegration due to
overloading in excess of load design. Any repairs to the roof or exterior walls
arising out of Lessee’s negligent operation will be the responsibility of the
Lessee. Lessee agrees to maintain the Premises in good and neat appearance and
in working order. Lessor agrees to make any repairs arising out of Lessor’s
negligence or breach of its obligations under this lease. Notwithstanding
anything to the contrary contained herein, in no event shall Lessee be
obligated to make or pay for any repairs or replacements which would constitute
items of expense properly chargeable to “capital account” under • GAAP and which are required
as the result of the negligence or willful misconduct of Lessor, its agents,
employees, representatives or contractors, or the failure of Lessor to perform
any of its obligations under this Lease, all in which repairs and replacements
shall be made by Lessor at Lessor’s sole cost and expense. Lessor shall maintain,
at its sole cost and expense, the foundation, floor slab, exterior walls, steel
frame, structural portions, roof, gutters, downspouts, and exterior doors of
the Building, as well as all utility lines, pipes and plumbing serving but
located outside of the Building (including without limitation all underground
utility lines, pipes and plumbing), in good, clean and safe repair, order and
condition. Lessor shall make all repairs and replacements without, to the
extent practicable, interfering with the conduct of Lessee’s business. If
during such repairs or replacements the Premises are wholly or partially
unsuitable for their use as provided in this Lease, there shall be an equitable
abatement of Fixed Rent, Additional Rent and all other charges payable by Lessee
hereunder until such time as such repairs and replacements have been completed.

 

B.            Lessor covenants and agrees to
maintain and keep in good repair the roof, roof structure, gutter, down-spouts,
plumbing, exterior walls and foundation walls and floors unless the repairs are
occurred by the negligent acts of the Lessee. Lessee agrees to restrict access
to any roof area being Lessor’s responsibility to maintain, with any such
access being granted only to a licensed roofing contractor. Violation of this restriction
by Lessee shall immediately upon occurrence relieve Lessor of any stated
maintenance liability.

 

C.            The Lessor shall provide supplier’s
and manufacturer’s warranties that all work performed in the design and
construction of the premises is free form any defect in equipment, material,

 

9

 

design furnished,
or workmanship performed by any of Lessor’s subcontractors or suppliers, as may
still be applicable and appropriate.

 

D.            With respect to all warranties,
expressed or implied, from Lessor’s subcontractors, manufacturers or suppliers
for work performed and materials furnished for the Premises, the Lessor shall:

 

1.             Obtain all warranties that would be
given in normal commercial practice;

 

2.             Require all warranties to be
executed, in writing for the benefit of the Lessee, if requested by the Lessee,
as may be applicable;

 

3.             Enforce all warranties for the
benefit of the Lessee, if requested by the Lessee.

 

22.  UTILITIES

 

All electricity,
heating, air conditioning, water sewage disposal and waste disposal shall be
furnished by Lessee. Lessee shall pay the cost of water, sewer, electric
current, heating, ventilating and air conditioning used in or supplied to the
Premises at the actual rates charged by the utility company. governmental
entity or individual or company providing such services. Lessor shall provide
separate utility meters for the respective facilities as deemed appropriate.

 

23.  COVENANTS RUN TO HEIRS, SUCCESSORS AND
ASSIGNS

 

It is hereby covenanted
and agreed between the parties hereto that all covenants, conditions,
agreements and undertakings contained in this Lease Agreement shall inure and
extend to and be binding on the heirs, administrators, executors, legal
representatives, successors and assigns of the respective parties hereto as if
they were in every case named and expressed. However, this paragraph is not
intended, nor shall be construed, to permit assignment or transfer of this
lease, whether by contract or operation of law, without compliance with Article 8
of this Lease Agreement.

 

The term “Lessor” and “Lessee” shall be construed
in the singular or plural number accordingly as they respectively represent one
or more than one person.

 

24.  NOTICES

 

All notices
required or provided for under this Lease Agreement shall be given in writing
by registered or certified (return receipt request) U.S. Mail, with the postage
prepaid thereon, and addressed to Lessee at:

 

Eberline Analytical Crop.

Attn: Mike McDougal, Manager

601-A Scarboro Road Oak Ridge, TN 37830

 

to Lessor at:

J.W. Gibson Construction Company

P.O. Box 7027

Oak Ridge, TN 37831-7027

 

with a copy to:

Allied Realty & Management

148 Ridgeway Center

Oak Ridge, TN 37830

 

10

 

25.  TRANSFER OF LESSOR’S RIGHTS

 

Lessor shall have
the right to transfer and assign, in whole or in part, all and every feature of
its rights and obligations hereunder and in the building and property referred
to herein. Such transfers or assignments may be made either to a corporation,
partnership, trust company, group of individuals, and howsoever made, are to be
in all things respected and recognized by Lessee and in the event of a transfer
following commencement of the term hereof upon assumption of Lessor obligations
hereunder by said transferees or assignee, the Lessor, immediately prior to
said transfer or assignment shall be relieved of all further liabilities and
obligations hereunder; provided, however, that Lessee’s rights under the lease
shall remain in effect so long as Lessee is not in default.

 

26.  PROPERTY TAXES

 

Lessee shall be
liable for all personal property taxes which shall be its sole responsibility.
Lessor shall be liable for real property taxes, but shall be reimbursed by
Lessee pursuant to Article 7, Paragraph B herein.

 

27.  RIGHT TO PURCHASE PROPERTY

 

Lessee has the
first right of refusal to purchase the entire property and buildings, as
defined by Exhibit A, or a portion thereof, if divisible. Lessor will
provide Lessee with thirty (30) days written notice of intent to sell and
Lessee has that time to exercise right of first refusal. The purchase price
shall be negotiated between Lessor and Lessee at the time of purchase.

 

 

	
  J. W. Gibson Construction Company

  	
   

  	
  Thermo Nutech

  
	
   

  	
   

  	
   

  
	
  By:

  	
  /s/ J.W. Gibson

  	
   

  	
  By:

  	
  /s/ Jeffery Stein

  
	
   

  	
  J.W. Gibson

  	
   

  	
  Jeffery Stein

  
	
   

  	
   

  	
   

  
	
  Title: President

  	
  Title: Vice President

  
	
   

  	
   

  
	
  Date: 10/24/00

  	
  Date: 10/6/00

  
					

 

11

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