Document:

Second Amended Reston Lease

                                                                            Exhibit
10.24

 

SECOND
AMENDMENT TO LEASE 

This
SECOND
AMENDMENT TO LEASE (the
“Amendment”) is made
effective as of and deemed entered into as of November 3, 2004, by and between
TMT Reston I & II, Inc., a Delaware corporation (“Landlord”), and
Talk America Holdings, Inc., a Delaware corporation (“Tenant”).

                                                Recitals

        A.     Reston Plaza I &
II, LLC (“Reston
Plaza”), as
landlord, and Talk.com, Inc. (“Talk.com”), a
Delaware corporation, as tenant, entered into a Lease Agreement, dated April 28,
2000, as amended by that certain First Amendment to Lease, dated May 6, 2004
(collectively, the “Reston
II Lease”).

        B.     Landlord is the
successor-in-interest to Reston Plaza and Tenant is successor-in-interest to
Talk.com. 

        C.     Pursuant to the
Reston II Lease, Landlord leases to Tenant approximately 10,019 rentable square
feet on the second (2nd) floor of that certain building located at 12020 Sunrise
Valley Drive in Reston, Virginia (“Reston
Plaza II”).

        D.     Landlord, as
landlord, and Talk America, Inc., a Pennsylvania corporation (“Talk
America, Inc.”), as
tenant, entered into a Lease Agreement, dated as of the date hereof (the
“Reston
I Lease”).

        E.     Talk America, Inc. is
a wholly owned subsidiary of Tenant. 

        F.     Pursuant to the
Reston I Lease, Landlord leases to Talk America, Inc. approximately 1,136
rentable square feet on the first (1st) floor of that certain building located
at 12030 Sunrise Valley Drive in Reston, Virginia (“Reston
Plaza I”).

        G.     Landlord requires, as
a condition of entering into the Reston I Lease, that the Reston II Lease be
amended, and Tenant desires to amend the Reston II Lease on the terms and
conditions hereinafter set forth. 

        NOW
THEREFORE, in
consideration of the above recitals which by this reference are incorporated
herein and made a substantive part hereof, the mutual covenants and conditions
contained herein and other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, Landlord and Tenant, intending to
be legally bound, hereby agree as follows: 

    1.     Incorporation by
Reference; Recitals. All
capitalized terms not defined in this Amendment shall have the same meaning as
in the Reston II Lease. The foregoing recitals are true and correct and
incorporated herein by reference as if set forth in their entirety herein.

1

    2.     Cross-Default. Any
Event of Default by Talk America, Inc. as that term is defined under the Reston
I Lease shall constitute an Event of Default under this Reston II Lease. If an
Event of Default occurs under this Reston II Lease or the Reston I Lease,
Landlord shall have the right, at its sole option, to exercise any one or more
of the remedies provided for an Event of Default as set forth in the Reston II
Lease and the Reston I Lease or as otherwise permitted pursuant to applicable
law, such remedies to be exercised concurrently or consecutively, and not
alternatively. 

    3.     Ratification. Except
as expressly modified and amended by the provisions of this Amendment, all
terms, covenants and conditions of the Reston II Lease shall remain in full
force and effect in accordance with their terms. 

    4.     Time. Time is
of the essence of this Amendment, the Reston II Lease and all of their
provisions. 

    5.     Entire
Agreement. The
Reston II Lease, as amended hereby, contains all agreements of the parties to
this Amendment and supersedes any previous negotiations. There have been no
representations made by the Landlord or understandings made between the parties
other than those set forth in the Lease (as hereby amended) and its exhibits.
The Reston II Lease may not be modified except by a written instrument duly
executed by the parties hereto. 

    6.     Tenant’s
Authority. If
Tenant signs as a corporation each of the persons executing this Amendment on
behalf of Tenant represents and warrants that Tenant has been and is qualified
to do business in the state in which the Building is located, that the
corporation has full right and authority to enter into this Amendment, and that
all persons signing on behalf of the corporation were authorized to do so by
appropriate corporate actions. If Tenant signs as a partnership, trust or other
legal entity, each of the persons executing this Amendment on behalf of Tenant
represents and warrants that Tenant has complied with all applicable laws, rules
and governmental regulations relative to its right to do business in the state
and that such entity on behalf of the Tenant was authorized to do so by any and
all appropriate partnership, trust or other actions. Tenant agrees to furnish
promptly upon request a corporate resolution, proof of due authorization by
partners, or other appropriate documentation evidencing the due authorization of
Tenant to enter into this Amendment. 

    7.     Miscellaneous. This
Amendment (i) shall be binding upon and inure to the benefit of Landlord and
Tenant, and their respective successors, assigns and related entities (subject
to any restrictions set forth in the Reston II Lease) and (ii) shall be governed
by and construed in accordance with the laws of the Commonwealth of Virginia and
may be executed in multiple counterparts or by facsimile transmissions, each of
which shall be treated as an original of this Amendment for all purposes, and
all of which shall constitute one (1) agreement binding upon all of the parties
hereto, notwithstanding that all the parties are not signatory to the original
or the same counterpart or facsimile transmission. Each such counterpart or
facsimile transmission shall be admissible into evidence as an original hereof
against the party who executed it. 

 

2

    8.     Waivers.
Landlord and Tenant each agree to and they hereby waive trial by jury in any
action, proceeding or counterclaim brought by either of the parties hereto
against the other on any matters whatsoever arising out of or in any way
connected with this Amendment or the Reston II Lease. 

    9.     Limitation
of Landlord’s Liability. Redress
for any claim against Landlord under the Reston II Lease and this Amendment
shall be limited to and enforceable only against and to the extent of Landlord’s
interest in the Building (as defined in the Reston II Lease). The obligations of
Landlord under the Reston II Lease and this Amendment are not intended to and
shall not be personally binding on, nor shall any resort be had to the private
properties of, any of its trustees or board of directors and officers, as the
case may be, its investment manager, the general partners thereof, or any
beneficiaries, stockholders, employees, or agents of Landlord or the investment
manager. 

 

[SIGNATURES
ON NEXT PAGE] 

 

3

IN
WITNESS WHEREOF,
Landlord and Tenant have caused this Amendment to be executed as of the day and
year as first above written. 

	
      WITNESS:
      

      By:
      /s/ Christa Reodel      

      Name:
      Christa Reodel

      Title:
      Admin. Assistant
	
      LANDLORD:
      

       

      TMT
      RESTON I & II, INC., 

      a
      Delaware corporation 

      By:
      RREEF Management Company, 

      a
      Delaware corporation 

      By:
      /s/ Mark Arena

      Mark
      Arena 

      Title:
      District Manager 

      Dated:
      11/3/04 

	
      ATTEST:
      

      By:
      /s/ Craig H. Pizer

      Name:
      Craig H. Pizer

      Title:
      Associate General Counsel 

      [Corporate
      Seal] 
	
      TENANT:
      

      TALK
      AMERICA HOLDINGS, INC., a Delaware corporation 

      By:
      /s/ Aloysius T. Lawn IV 

      Name:
      Aloysius T. Lawn IV 

      Title:
      EVP - General Counsel

      Dated:
      10/28/04Summary Description of 2004 Supplemental Incentive Compensation Plan

 

                     

                                                                            Exhibit
10.29

 

 

SUMMARY
OF 2004 SUPPLEMENTAL INCENTIVE COMPENSATION PLAN

As
adopted by the Compensation Committee of the Board of Directors of Talk America
Holdings, Inc. (the "Company"), the supplemental incentive compensation plan
applies to the employees of the Company and its subsidiaries who are designated
as participants by the Compensation Committee.  Under this plan, the
participating employees are organized in groups on a cross-functional basis and
charged with the responsibility for improving and monitoring the following
operational areas: customer satisfaction, general and administrative
expenses/capital budget, sales and marketing, credit quality, gross margin and
facilities-based provisioning.  Incentive compensation under this plan is
based upon the achievement of certain operational performance measures
established by the Compensation Committee when it adopted the plan.
 Maximum incentive compensation per employee for each cross-function team
is $4,000 per six-month period, with an aggregate six-month cap of $8,000.
 The Company's executive officers, other than its Chief Executive Officer
and President, are entitled to participate in this incentive plan.Reston Lease

                                                      Exhibit
10.32                    

 

                   LEASE

 

                                TMT RESTON I &
II, INC., 

 

                                      as Landlord,

 

                                       and 

 

                          TALK AMERICA
INC.,

 

                                 as Tenant

 

1

 

		TABLE
      OF CONTENTS                                                 Page

   

	
      1.
      USE AND RESTRICTIONS ON USE          
	 1
	
      2.
      TERM                             
	 2
	
      3. RENT            
	 3
	
       4. RENTADJUSTMENTS                                               
	 4
	 5. SECURITY DEPOSIT 	 7
	 6.ALTERATIONS                                                        	 8
	
       7. REPAIR                                                        
	 9
	 8. LIENS                                                           	 9
	 9. ASSIGNMENT AND SUBLETTING                                 	 10
	 10. INDEMNIFICATION                                               	 12
	 11. INSURANCE                                                       	 12
	 12. WAIVER OF SUBROGATION                               	 13
	 13. SERVICES AND UTILITIES                             	 13
	 14. HOLDING OVER                      	 15
	 15. SUBORDINATION                                            	 15
	 16. RULES AND REGULATIONS                                 	 16
	 17. REENTRY BY LANDLORD                              	 16
	 18. DEFAULT                                     	 16
	 19. REMEDIES                                     	 18
	 20. TENANT’S BANKRUPTCY OR
      INSOLVENCY                          	 21
	 21. QUIET ENJOYMENT                             	 22
	 22. CASUALTY         	 22
	 23. EMINENT DOMAIN                      	 24
	 24. SALE BY LANDLORD                                   	 24
	 25. ESTOPPEL CERTIFICATES	 25
	 26. SURRENDER OF PREMISES	 25
	 27. NOTICES     	 26
	 28. TAXES PAYABLE BY TENANT 	 26
	 29. RELOCATION OF TENANT	 27
	 30. DEFINED TERMS AND HEADINGS 	 27

 

2

 

	   31. TENANT’S AUTHORITY                                	 27
	
      32.
      FINANCIAL STATEMENTS AND CREDIT REPORTS
	 28
	
      33.
      COMMISSIONS       
      
	 28
	   34. TIME AND APPLICABLE
      LAW	 28
	   35. SUCCESSORS AND
    ASSIGNS	 28
	   36. ENTIRE AGREEMENT	 28
	   37. EXAMINATION NOT
    OPTION	 29
	   38. RECORDATION	 29
	   39. PARKING 	 29
	   40. LIMITATION OF LANDLORD’S
      LIABILITY	 29
	 EXHIBIT A - FLOOR PLAN DEPICTING THE
      PREMISES 	 A-1 
	 EXHIBIT A-1 - SITE PLAN	 A-1-1
	 EXHIBIT B - INITIAL
    ALTERATIONS	 B-1 
	 EXHIBIT C - COMMENCEMENT DATE
      MEMORANDUM	 C-1
	 EXHIBIT D - RULES AND
    REGULATIONS	 D-1
	 EXHIBIT E - FORM OF GUARANTY	 E-1 

 

 

3

 

LEASE

REFERENCE
PAGES 

	
      BUILDING:
      
	
      Reston
      Plaza I 

      12030
      Sunrise Valley Drive 

      Reston,
      VA 20191 

	
      LANDLORD:
      
	
      TMT
      Reston I & II, Inc., a Delaware corporation 

	
      LANDLORD’S
      ADDRESS: 
	
      c/o
      RREEF 

      8280
      Greensboro Drive, Suite 550 

      McLean,
      Virginia 22102 

      Attn:
      Mark Arena, District Manager 

      with
      a copy (which shall not constitute notice) to: 

      Covington
      & Burling 

      1201
      Pennsylvania Avenue, N.W. 

      Washington,
      D.C. 20004-2401 

      Attention:
      Robert J. Gage, Esq. 

	
      ADDRESS
      FOR RENT PAYMENT: 
	
      TMT
      Reston I & II, Inc. 

      P.O.
      Box 13517 

      Newark,
      NJ 07188-0517 

	
      LANDLORD’S
      REGISTERED AGENT FOR SERVICE OF PROCESS: 
	
      Commonwealth
      Legal Services Corporation 

      4701
      Cox Road, Suite 301 

      Glen
      Allen, VA 23060-6802 

	
      LEASE
      REFERENCE DATE: 
	
      October
      28, 2004 

	
      TENANT:
      
	
      Talk
      America, Inc., a Pennsylvania corporation 

	
      TENANT’S
      NOTICE ADDRESS: 

	
      (a)
      As of beginning of Term: 
	
      Talk
      America Holdings, Inc. 

      12020
      Sunrise Valley Drive 

      Reston,
      Virginia 20191 

      Attn:
      Bill McGrath, Senior VP 

      with
      a copy (which shall not constitute notice) to: 

       Talk America Holdings, 

      6805
      Route 202 

      New
      Hope, PA 18938

      Attn: Legal
      Department 

 

 

4

 

 

	
               

	
      (b)
      Prior to beginning of Term (if different): 
	
      Talk
      America Holdings, Inc. 

      12020
      Sunrise Valley Drive 

      Reston,
      Virginia 20191 

      Attn:
      Bill McGrath, Senior VP 

      with
      a copy (which shall not constitute notice) to: 

      Talk
      America Holdings, Inc. 

      6805
      Route 202 

      New
      Hope, PA 18938 

      Attn:
      Legal Department 

	
      GUARANTOR
      
	
      Talk
      America Holdings, Inc. 

	
      GUARANTOR’S
      NOTICE ADDRESS 
	
      Talk
      America Holdings, Inc. 

      6805
      Route 202 

      New
      Hope, PA 18938 

      Attn:
      Bill McGrath, Senior VP 

	
      PREMISES
      IDENTIFICATION: 
	
      Suite
      Number 160 on the first (1st) floor of the Building (for outline of
      Premises see Exhibit A) 

	
      PREMISES
      RENTABLE AREA: 
	
      Approximately
      1,136 rentable sq. ft. (for outline of Premises see Exhibit A)
      

	
      SCHEDULED
      COMMENCEMENT DATE: 
	
      November
      1, 2004 

	
      TERM
      OF LEASE: 
	
      Approximately
      one (1) year, one (1) month beginning on the Commencement Date and ending
      on the Termination Date. The period from the Commencement Date to the last
      day of the same month is the “Commencement
      Month.”
      

	
      TERMINATION
      DATE: 
	
      November
      30, 2005 

	
      ANNUAL
      RENT: 
	
      Twenty
      Three and 00/100 Dollars ($23.00) per rentable square foot per annum,
      subject to an escalation of three percent (3%) per annum
      on  each anniversary of the Commencement Date, commencing with
      the first (1st) anniversary of the Commencement Date.
  

 

 

5

MONTHLY
INSTALLMENT OF RENT

	 Lease Year	 Rentable Square Footage	 Annual Rent Per Square Foot	 Annual Rent	 Monthly Installment of Rent
	 1	 1,136	 $23.00	 $26,128.00	 $2,177.33
	 2	 1,136	 $23.69	 $26,911.84	 $2,242.65

Pro-rated
for a partial Lease Year 

 

 

	
      BASE
      YEAR (EXPENSES): 
	
      January
      1, 2005 to December 31, 2005 

	
      BASE
      YEAR (INSURANCE): 
	
      January
      1, 2005 to December 31, 2005 

	
      BASE
      YEAR (TAXES): 
	
      January
      1, 2005 to December 31, 2005 

	
      BUILDING
      SIZE 
	
      approximately
      77,875 sq. ft. 

	
      TENANT’S
      PROPORTIONATE SHARE: 
	
      1.46%
      

	
      SECURITY
      DEPOSIT: 
	
      $2,177.33
      

	
      ASSIGNMENT/SUBLETTING
      FEE: 
	
      $2,500.00
      

	
      AFTER-HOURS
      HVAC COST: 
	
      $40.00
      per hour, subject to change at any time, from time to time.
    

	
      REAL
      ESTATE BROKER DUE COMMISSION: 
	
      None
      

	
      TENANT’S
      SIC CODE: 
	
      4812
      

	
      BUILDING
      BUSINESS HOURS: 
	
      Monday
      - Friday, 8:00 a.m. - 6:00 p.m. 

      Saturday,
      8:00 a.m. - 1:00 p.m. 

	
      AMORTIZATION
      RATE: 
	
      10%
      

The
Reference Pages information is incorporated into and made a part of the Lease.
In the event of any conflict between any Reference Pages information and the
Lease, the Lease shall control. This Lease includes the Exhibits, all of which
are made a part of this Lease. 

 

6

 

 

[SIGNATURES
CONTAINED ON NEXT PAGE] 

	
      WITNESS:
      

      By:____________________________
      

      Title:
      
	
      LANDLORD:
      

      TMT
      RESTON I & II, INC., 

      a
      Delaware corporation 

       

      By:
      RREEF MANAGEMENT COMPANY, 

      a
      Delaware corporation 

       

      By:
      /s/ Mark Arena

      Name:
      Mark Arena 

      Title:
      District Manager 

      Dated:
      11/3/04

	
      ATTEST:
      

      By: /s/
      Craig H. Pizer 

      Name:
      Craig H. Pizer

      Title:
      Associate General Counsel

      [Corporate
      Seal] 
	
      TENANT:
      

      TALK
      AMERICA, INC., 

      a
      Pennsylvania corporation 

      By:
      Aloysius T. Lawn IV 

      Name:
      Aloysius T. Lawm IV

      Title:
      EVP- General Counsel

      Dated:
      10/28/04

LEASE

 

By this
Lease Landlord leases to Tenant and Tenant leases from Landlord the Premises in
the Building as set forth and described on the Reference Pages. The Premises are
depicted on the floor plan attached hereto as Exhibit A, and the Building
is depicted on the site plan attached hereto as Exhibit A-1. The
Reference Pages, including all terms defined thereon, are incorporated as part
of this Lease. 

 

1.
USE AND RESTRICTIONS ON USE. 

 

    1.1. The
Premises are to be used solely for general office purposes. Tenant shall not do
or permit anything to be done in or about the Premises which will in any way
obstruct or interfere with the rights of other tenants or occupants of the
Building, including, but not limited to, any exclusive rights of another tenant
or occupant of the Building, or injure, annoy, or disturb them, or allow the
Premises to be used for any improper, immoral, unlawful, or objectionable
purpose, or commit any waste. Tenant shall not do, permit or suffer in, on, or
about the Premises the sale of any alcoholic liquor without the written consent
of Landlord first obtained. Tenant shall comply with all governmental laws,
ordinances and regulations applicable to the use of the Premises and its
occupancy and shall promptly comply with all governmental orders and directions
for the correction, prevention and abatement of any violations in the Building
or appurtenant land, caused or permitted by, or resulting from the specific use
by, Tenant, or in or upon, or in connection with, the Premises, all at Tenant’s
sole expense. Tenant shall not do or permit anything to be done on or about the
Premises or bring or keep anything into the Premises which will in any way
increase the rate of, invalidate or prevent the procuring of any insurance
protecting against loss or damage to the Building or any of its contents by fire
or other casualty or against liability for damage to property or injury to
persons in or about the Building or any part thereof. 

 

    1.2. Tenant
shall not, and shall not direct, suffer or permit any of its agents,
contractors, employees, licensees or invitees (collectively, the “Tenant
Entities”) to at
any time handle, use, manufacture, store or dispose of in or about the Premises
or the Building any (collectively “Hazardous
Materials”)
flammables, explosives, radioactive materials, hazardous wastes or materials,
toxic wastes or materials, or other similar substances, petroleum products or
derivatives or any substance subject to regulation by or under any federal,
state and local laws and ordinances relating to the protection of the
environment or the keeping, use or disposition of environmentally hazardous
materials, substances, or wastes, presently in effect or hereafter adopted, all
amendments to any of them, and all rules and regulations issued pursuant to any
of such laws or ordinances (collectively “Environmental
Laws”), nor
shall Tenant suffer or permit any Hazardous Materials to be used in any manner
not fully in compliance with all Environmental Laws, in the Premises or the
Building and appurtenant land or allow the environment to become contaminated
with any Hazardous Materials. Notwithstanding the foregoing, Tenant may handle,
store, use or dispose of products containing small quantities of Hazardous
Materials (such as aerosol cans containing insecticides, toner for copiers,
paints, paint remover and the like) to the extent customary and necessary for
the use of the Premises for general office purposes; provided that Tenant shall
always handle, store, use, and dispose of any such Hazardous Materials in a safe
and lawful manner and never allow such Hazardous Materials to contaminate the
Premises, Building and appurtenant land or the environment. Tenant shall
protect, defend, indemnify and hold each and all of the Landlord Entities (as
defined in Article 30) harmless from and against any and all loss, claims,
liability or costs (including court costs and attorney’s fees) incurred by
reason of any actual or asserted failure of Tenant to fully comply with all
applicable Environmental Laws, or the presence, handling, use or disposition in
or from the Premises of any Hazardous Materials by Tenant or any Tenant Entity
(even though permissible under all applicable Environmental Laws or the
provisions of this Lease), or by reason of any actual or asserted failure of
Tenant to keep, observe, or perform any provision of this Section 1.2.

 

7

2.
TERM. 

    2.1. The Term
of this Lease shall begin on the date (“Commencement
Date”) which
shall be the earlier of: (a) the date upon which Tenant begins Beneficial
Occupancy of the Premises; or (b) the later to occur of Landlord’s tendering of
the Premises to Tenant and the Scheduled Commencement Date as shown on the
Reference Pages, and shall terminate on the date as shown on the Reference Pages
(“Termination
Date”),
unless sooner terminated by the provisions of this Lease. Landlord shall tender
possession of the Premises with all the work, if any, to be performed by
Landlord pursuant to Exhibit B to this Lease substantially completed. Tenant
shall deliver a punch list of items not completed within ten (10) days after
Landlord tenders possession of the Premises and Landlord agrees to proceed with
due diligence to perform its obligations regarding such items. Tenant shall, at
Landlord’s request, execute and deliver a memorandum agreement provided by
Landlord in the form of Exhibit C attached hereto, setting forth the actual
Commencement Date, Termination Date and, if necessary, a revised rent schedule.
Should Tenant fail to do so within thirty (30) days after Landlord’s request,
the information set forth in such memorandum provided by Landlord shall be
conclusively presumed to be agreed and correct. Tenant acknowledges that it
enters into this Lease without any representations or warranties by the
Landlord, or anyone acting or purporting to act on behalf of Landlord, as to the
present or future condition of the Premises or the appurtenances thereto or any
improvements therein or of the Building, except as specifically set forth in
this Lease. It is further agreed that Tenant does and will accept the Premises
“AS IS” in their present condition as of the date hereof and the Landlord has no
obligation to perform any work therein. Notwithstanding any provision in this
Lease to the contrary, if the Term has not commenced within one (1) year after
the date of this Lease, this Lease shall automatically terminate on the first
(1st) anniversary of the date hereof. The sole purpose of the preceding sentence
is to avoid any possible interpretation that this Lease violates the Rule
Against Perpetuities or other rule of law against restraints on alienation.

 

    2.1.1.
Notwithstanding
any provision in this Lease to the contrary, Tenant’s leasing of the Premises
shall expire simultaneously with the expiration or earlier termination of that
certain Lease Agreement, dated April 28, 2000 entered into by and between Reston
Plaza I & II, LLC ("Reston"), as landlord, and Talk.com, Inc. ("Talk.com"),
as tenant, as amended by that certain First Amendment to Lease, dated May 6,
2004 entered into by and between Landlord, as landlord and successor-in-interest
to Reston, and Tenant, as tenant and successor-in-interest to Talk.com, and as
further amended by that certain Second Amendment to Lease dated as of the date
hereof entered into by and between Landlord, and Tenant (collectively, the
“Reston
II Lease”), and
Tenant shall surrender possession of the Premises to Landlord in accordance with
the terms of this Lease, including without limitation, Section 26 herein.

    2.2. Tenant
agrees that in the event of the inability of Landlord to deliver possession of
the Premises on the Scheduled Commencement Date for any reason, Landlord shall
not be liable for any damage resulting from such inability, but Tenant shall not
be liable for any rent until the time when Landlord can, after notice to Tenant,
deliver possession of the Premises to Tenant. No such failure to give possession
on the Scheduled Commencement Date shall affect the other obligations of Tenant
under this Lease, except that if Landlord is unable to deliver possession of the
Premises within one hundred twenty (120) days after the Scheduled Commencement
Date (other than as a result of strikes, shortages of materials, holdover
tenancies or similar matters beyond the reasonable control of Landlord and
Tenant is notified by Landlord in writing as to such delay), Tenant shall have
the option to terminate this Lease unless said delay is as a result of: (i)
Tenant’s request for changes to the Final Plans (defined in Exhibit B) (or other
Tenant change orders); (ii) Tenant’s acts or omissions which result in
Landlord’s inability to obtain timely a certificate of occupancy for the
Premises, if any, provided that Landlord shall have expressly agreed to obtain
same; (iii) based upon Tenant’s Final Plans, the inclusion in Tenant’s
Improvements by either party hereunder of any materials, finishes, or other
items which: (A) require a long lead time for procurement and installation; or
(B) are non-Landlord Building standard materials, finishes, or other items; or
(iv) Tenant’s failure to timely (a) furnish timely its requirements or agree to
any plans and specifications and/or construction cost estimates or bids; (b)
approve or revise any plans and specifications as provided in the Project
Schedule; (c) cause the timely performance or completion by a party employed by
Tenant (each of the foregoing, a “Tenant
Delay”). If
any delay is the result of a Tenant Delay, the Commencement Date and the payment
of rent under this Lease shall be accelerated by the number of days of such
Tenant Delay. 

    2.3.
Notwithstanding that the Term or Commencement Date may not have yet occurred, if
Landlord shall permit Tenant or any person or entity lawfully acting by or
through Tenant to possess or otherwise use the Premises prior to the Term or
Commencement Date, such possession or use shall be subject to all the provisions
of this Lease as if the Term and Commencement Date had otherwise commenced or
occurred; provided, however: (i) Tenant shall not be obligated to pay Annual
Rent or Tenant’s proportionate share of Expenses, Insurance Costs, or Taxes with
respect to any period prior to the actual Term or Commencement Date; and (ii)
such early possession and use shall not be included in determination of the
Lease Year, as defined in Section 4.1.1 of this Lease. If Tenant or such person
or entity should enjoy such early possession or use of the Premises, the Term of
the Lease shall be deemed to have so commenced solely for the purpose of causing
Tenant’s covenants, obligations, indemnities, and other agreement under the
Lease during the Term to be effective and binding upon Tenant during such early
possession (such as, but not limited to, Tenant’s being obligated to obtain all
insurance required of it under the Lease). Said early possession and use shall
not advance the Termination Date. Subject to the provisions of this Lease,
including Section 2.1, prior access to, and use of, the Premises by Tenant or
Tenant’s agents or vendors for the purposes of installing furniture, fixtures,
or equipment of Tenant shall not advance the Term or Commencement Date.

 

 

8

3.
RENT. 

    3.1. Tenant
agrees to pay to Landlord the Annual Rent in effect from time to time by paying
the Monthly Installment of Rent then in effect on or before the first day of
each full calendar month during the Term, except that the first full month’s
rent shall be paid upon the execution of this Lease. The Monthly Installment of
Rent in effect at any time shall be one-twelfth (1/12) of the Annual Rent in
effect at such time. Rent for any period during the Term which is less than a
full month shall be a prorated portion of the Monthly Installment of Rent based
upon the number of days in such month. Said rent shall be paid to Landlord,
without deduction or offset and without notice or demand, at the Rent Payment
Address, as set forth on the Reference Pages, or to such other person or at such
other place as Landlord may from time to time designate in writing. If an Event
of Default occurs, Landlord may require by notice to Tenant that all subsequent
rent payments be made by an automatic payment from Tenant’s bank account to
Landlord’s account, without cost to Landlord. Tenant must implement such
automatic payment system prior to the next scheduled rent payment or within ten
(10) days after Landlord’s notice, whichever is later. Unless specified in this
Lease to the contrary, all amounts and sums payable by Tenant to Landlord
pursuant to this Lease shall be deemed additional rent. 

    3.2. Tenant
recognizes that late payment of any rent or other sum due under this Lease will
result in administrative expense to Landlord, the extent of which additional
expense is extremely difficult and economically impractical to ascertain. Tenant
therefore agrees that if rent or any other sum is not paid when due and payable
pursuant to this Lease, a late charge shall be imposed in an amount equal to the
greater of: (a) Fifty Dollars ($50.00), or (b) six percent (6%) of the unpaid
rent or other payment. The amount of the late charge to be paid by Tenant shall
be reassessed and added to Tenant’s obligation for each successive month until
paid. The provisions of this Section 3.2 in no way relieve Tenant of the
obligation to pay rent or other payments on or before the date on which they are
due, nor do the terms of this Section 3.2 in any way affect Landlord’s remedies
pursuant to Article 19 of this Lease in the event said rent or other payment is
unpaid after date due. 

    3.3.
Notwithstanding anything to the contrary contained herein, if the Commencement
Month is not a full calendar month, such Commencement Month shall be deemed for
all purposes of this Lease to be part of the First Lease Year and Tenant shall
pay additional Annual Rent for such Commencement Month calculated on a per diem
basis at the Annual Rental Rate for the First Lease Year. 

4.
RENT ADJUSTMENTS. 

 

    4.1. For the
purpose of this Article 4, the following terms are defined as follows:

 

        4.1.1. Lease
Year: Each
consecutive twelve (12) month period falling partly or wholly within the Term;
provided, however, if the Commencement Month is not a full calendar month,
then the first Lease Year shall consist of the Commencement Month and the
subsequent twelve (12) consecutive month period. 

 

      4.1.2. Expenses:
All costs
of operation, maintenance, repair, replacement and management of the Building
(including the amount of any credits which Landlord may grant to particular
tenants of the Building in lieu of providing any standard services or paying any
standard costs described in this Section 4.1.2 for similar tenants), as
determined in accordance with generally accepted accounting principles,
including the following costs by way of illustration, but not limitation: water
and sewer charges; utility costs, including, but not limited to, the cost of
heat, light, power, steam, gas; waste disposal; the cost of janitorial services;
the cost of access control and monitoring services (including any central
station signaling system); costs of cleaning, repairing, replacing and
maintaining the common areas, including parking and landscaping, window cleaning
costs; labor costs; costs and expenses of managing the Building including
management and/or administrative fees; air conditioning maintenance costs;
elevator maintenance fees and supplies; material costs; equipment costs
including the cost of maintenance, repair and service agreements and rental and
leasing costs; purchase costs of equipment; current rental and leasing costs of
items which would be capital items if purchased; tool costs; licenses, permits
and inspection fees; wages and salaries; employee benefits and payroll taxes;
accounting and legal fees; any sales, use or service taxes incurred in
connection therewith. In addition, Landlord shall be entitled to recover, as
additional rent (which, along with any other capital expenditures constituting
Expenses, Landlord may either include in Expenses or cause to be billed to
Tenant along with Expenses and Taxes but as a separate item), Tenant’s
Proportionate Share of: (i) an allocable portion of the cost of capital
improvement items which are reasonably calculated to reduce operating expenses;
(ii) the cost of fire sprinklers and suppression systems and other life safety
systems; and (iii) other capital expenses which are required under any
governmental laws, regulations or ordinances which were not applicable to the
Building at the time it was constructed; but the costs described in this
sentence shall be amortized over the reasonable life of such expenditures in
accordance with such reasonable life and amortization schedules as shall be
determined by Landlord in accordance with generally accepted accounting
principles, with interest on the unamortized amount at one percent (1%) in
excess of the Wall Street Journal prime lending rate announced from time to
time. Expenses shall not include Taxes, Insurance Costs, depreciation or
amortization of the Building or equipment in the Building except as provided
herein, loan principal payments, costs of alterations of tenants’ premises,
leasing commissions, interest expenses on long-term borrowings or advertising
costs. If any Direct Expenses are shared jointly between or among the Building
and another building, such as, but not limited to, Reston Plaza II, such costs
shall be allocated proportionately between or among such buildings based upon
the rentable square footage of each building, or such other equitable manner as
Landlord shall deem appropriate. 

 

 

9

        4.1.3.
Taxes:
Real
estate taxes and any other taxes, charges and assessments which are levied with
respect to the Building or the land appurtenant to the Building, or with respect
to any improvements, fixtures and equipment or other property of Landlord, real
or personal, located in the Building and used in connection with the operation
of the Building and said land, any payments to any ground lessor in
reimbursement of tax payments made by such lessor; and all fees, expenses and
costs incurred by Landlord in investigating, protesting, contesting or in any
way seeking to reduce or avoid increase in any assessments, levies or the tax
rate pertaining to any Taxes to be paid by Landlord in any calendar year. Taxes
shall not include any corporate franchise, or estate, inheritance or net income
tax, or tax imposed upon any transfer by Landlord of its interest in this Lease
or the Building or any taxes to be paid by Tenant pursuant to Article 28. If any
Taxes are shared jointly between or among the Building and another building,
such as, but not limited to, Reston Plaza II, such costs shall be allocated
proportionately between or among such buildings based upon the rentable square
footage of each building, or such other equitable manner as Landlord shall deem
appropriate. 

 

        4.1.4. Insurance
Costs: Any and
all insurance charges of or relating to all insurance policies and endorsements
deemed by Landlord to be reasonably necessary or desirable and relating in any
manner to the protection, preservation, or operation of the
Building or any
part thereof. If any Insurance Costs are shared jointly between or among the
Building and another building, such as, but not limited to, Reston Plaza II,
such costs shall be allocated proportionately between or among such buildings
based upon the rentable square footage of each building, or such other equitable
manner as Landlord shall deem appropriate. 

    4.2. If in
any calendar year, (i) Expenses paid or incurred shall exceed Expenses paid or
incurred in the Base Year (Expenses) and/or (ii) Taxes paid or incurred by
Landlord shall exceed the amount of such Taxes which became due and payable in
the Base Year (Taxes), and/or (iii) Insurance Costs paid or incurred by Landlord
shall exceed the amount of such Insurance Costs which became due and payable in
the Base Year (Insurance Costs), Tenant shall pay as additional rent for such
calendar year Tenant’s Proportionate Share of each such excess amount.

    4.3. The
annual determination of Expenses and Insurance Costs shall be made by Landlord
and shall be binding upon Landlord and Tenant, subject to the provisions of this
Section 4.3. During the Term, Tenant may review, at Tenant’s sole cost and
expense, the books and records supporting such determination in an office of
Landlord, or Landlord’s agent, during normal business hours, upon giving
Landlord five (5) days advance written notice within sixty (60) days after
receipt of such determination, but in no event more often than once in any one
(1) year period, subject to execution of a confidentiality agreement acceptable
to Landlord, and provided that if Tenant utilizes an independent accountant to
perform such review it shall be one of national standing which is reasonably
acceptable to Landlord, is not compensated on a contingency basis and is also
subject to such confidentiality agreement. If Tenant fails to object to
Landlord’s determination of Expenses and Insurance Costs within ninety (90) days
after receipt, or if any such objection fails to state with specificity the
reason for the objection, Tenant shall be deemed to have approved such
determination and shall have no further right to object to or contest such
determination. In the event that during all or any portion of any calendar year
or Base Year, the Building is not fully rented and occupied Landlord shall make
an appropriate adjustment in occupancy-related Expenses for such year for the
purpose of avoiding distortion of the amount of such Expenses to be attributed
to Tenant by reason of variation in total occupancy of the Building, by
employing consistent and sound accounting and management principles to determine
Expenses that would have been paid or incurred by Landlord had the Building been
at least ninety-five percent (95%) rented and occupied, and the amount so
determined shall be deemed to have been Expenses for such calendar year.

    4.4. Prior to
the actual determination thereof for a calendar year, Landlord may from time to
time estimate Tenant’s liability for Expenses, Insurance Costs and/or Taxes
under Sections 4.1, Article 6.3 and Article 28 for the calendar year or portion
thereof. Landlord will give Tenant written notification of the amount of such
estimate and Tenant agrees that it will pay, by increase of its Monthly
Installments of Rent due in such calendar year, additional rent in the amount of
such estimate. Any such increased rate of Monthly Installments of Rent pursuant
to this Section 4.4 shall remain in effect until further written notification to
Tenant pursuant hereto. 

 

10

    4.5. When the
above mentioned actual determination of Tenant’s liability for Expenses,
Insurance Costs and/or Taxes is made for any calendar year and when Tenant is so
notified in writing, then: 

        4.5.1. If the total
additional rent Tenant actually paid pursuant to Section 4.3 on account of
Expenses, Insurance Costs and/or Taxes for the calendar year is less than
Tenant’s liability for Expenses, Insurance Costs and/or Taxes, then Tenant shall
pay such deficiency to Landlord as additional rent in one lump sum within thirty
(30) days of receipt of Landlord’s bill therefor; and 

        4.5.2. If the total
additional rent Tenant actually paid pursuant to Section 4.3 on account of
Expenses, Insurance Costs and/or Taxes for the calendar year is more than
Tenant’s liability for Expenses, Insurance Costs and/or Taxes, then Landlord
shall credit the difference against the then next due payments to be made by
Tenant under this Article 4, or, if the Lease has terminated, refund the
difference in cash. Tenant shall not be entitled to a credit by reason of actual
Expenses and/or Taxes and/or Insurance Costs in any calendar year being less
than Expenses and/or Taxes and/or Insurance Costs in the Base Year (Expenses
and/or Taxes and/or Insurance). 

    4.6. If the
Commencement Date is other than January 1 or if the Termination Date is other
than December 31, Tenant’s liability for Expenses, Insurance Costs and Taxes for
the calendar year in which said Date occurs shall be prorated based upon a three
hundred sixty-five (365) day year. Tenant’s obligation to pay Tenant’s
Proportionate Share of any unpaid Expenses, Insurance Costs, and Taxes which are
otherwise due and payable under this Lease shall survive the expiration or
earlier termination of the Term. 

5.
SECURITY DEPOSIT. 

    5.1. Tenant
shall deposit the Security Deposit with Landlord upon the execution of this
Lease. Said sum shall be held by Landlord as security for the faithful
performance by Tenant of all the terms, covenants and conditions of this Lease
to be kept and performed by Tenant and not as an advance rental deposit or as a
measure of Landlord’s damage in case of Tenant’s default. If Tenant defaults
with respect to any provision of this Lease, Landlord may use any part of the
Security Deposit for the payment of any rent or any other sum in default, or for
the payment of any amount which Landlord may spend or become obligated to spend
by reason of Tenant’s default, or to compensate Landlord for any other loss or
damage which Landlord may suffer by reason of Tenant’s default. If any portion
is so used, Tenant shall within five (5) days after written demand therefor,
deposit with Landlord an amount sufficient to restore the Security Deposit to
its original amount and Tenant’s failure to do so shall be a material breach of
this Lease. Except to such extent, if any, as shall be required by law, Landlord
shall not be required to keep the Security Deposit separate from its general
funds, and Tenant shall not be entitled to interest on such deposit. If Tenant
shall fully and faithfully perform every provision of this Lease to be performed
by it, the Security Deposit or any balance thereof shall be returned to Tenant
at such time after termination of this Lease when Landlord shall have determined
that all of Tenant’s obligations under this Lease have been fulfilled.

    5.2. As
additional security for the faithful performance by Tenant of all covenants,
conditions and agreements of this Lease, Talk America Holdings, Inc.,
(“Guarantor”) has executed and delivered to Landlord the Continuing Lease
Guaranty (the “Guaranty”), in the form attached hereto as Exhibit E,
unconditionally guaranteeing to Landlord the due and punctual payment and
performance by Tenant of all of Tenant’s obligations hereunder for the time
period and as otherwise more particularly set forth in the Guaranty. No right or
remedy available to Landlord under the Guaranty or this Lease shall extinguish
any other right to which Landlord may be entitled. In furtherance of the
foregoing, it is understood that in the event Tenant fails to perform any of its
obligations hereunder, any amounts recovered by Landlord under the Guaranty
shall not be deemed liquidated damages. Landlord may apply such sums to reduce
Landlord’s damages and such application of funds shall not preclude Landlord
from recovering from Tenant or the Guarantor jointly and severally all
additional damages incurred by Landlord by reason of Tenant’s failure to perform
hereunder. 

 

11

 

6.
ALTERATIONS. 

    6.1. Except
for those, if any, specifically provided for in Exhibit
B to this
Lease, Tenant shall not make or suffer to be made any alterations, additions, or
improvements, including, but not limited to, the attachment of any fixtures or
equipment in, on, or to the Premises or any part thereof or the making of any
improvements as required by Article 7, without the prior written consent of
Landlord. When applying for such consent, Tenant shall, if requested by
Landlord, furnish complete plans and specifications for such alterations,
additions and improvements. Landlord’s consent shall not be unreasonably
withheld with respect to alterations which (i) are not structural in nature,
(ii) are not visible from the exterior of the Building, (iii) do not affect or
require modification of the Building’s electrical, mechanical, plumbing, HVAC or
other systems, (iv) will not interfere with the use and occupancy of any other
portion of the Building by any other tenant or their invitees; (v) do not and
will not, whether alone or taken together with other improvements, require the
construction of any other improvements or alterations in other tenant’s space or
the Common Areas; and (vi) in aggregate do not cost more than $2.50 per rentable
square foot of that portion of the Premises affected by the alterations in
question. 

    6.2. In the
event Landlord consents to the making of any such alteration, addition or
improvement by Tenant, the same shall be made by using either Landlord’s
contractor or a contractor reasonably approved by Landlord, in either event at
Tenant’s sole cost and expense. If Tenant shall employ any contractor other than
Landlord’s contractor and such other contractor or any subcontractor of such
other contractor shall employ any non-union labor or supplier, Tenant shall be
responsible for and hold Landlord harmless from any and all delays, damages and
extra costs suffered by Landlord as a result of any dispute with any labor
unions concerning the wage, hours, terms or conditions of the employment of any
such labor. In any event Landlord may charge Tenant an administrative fee not to
exceed five percent (5%) of the cost of such work to cover its overhead as it
relates to such proposed work, plus third-party costs actually incurred by
Landlord in connection with the proposed work and the design thereof, with all
such amounts being due five (5) days after Landlord’s demand. 

    6.3. All
alterations, additions or improvements proposed by Tenant shall be constructed
in accordance with all government laws, ordinances, rules and regulations, using
Building standard materials where applicable, and Tenant shall, prior to
construction, provide the additional insurance required under Article 11 in such
case, and also all such assurances to Landlord as Landlord shall reasonably
require to assure payment of the costs thereof, including but not limited to,
notices of non-responsibility, waivers of lien, surety company performance bonds
and funded construction escrows and to protect Landlord and the Building and

appurtenant
land against any loss from any mechanic’s, materialmen’s or other liens. Tenant
shall pay in addition to any sums due pursuant to Article 4, any increase in
real estate taxes attributable to any such alteration, addition or improvement
for so long, during the Term, as such increase is ascertainable; at Landlord’s
election said sums shall be paid in the same way as sums due under Article 4.
Landlord may, as a condition to its consent to any particular alterations or
improvements, require Tenant to deposit with Landlord the amount reasonably
estimated by Landlord as sufficient to cover the cost of removing such
alterations or improvements and restoring the Premises, to the extent required
under Section 26.2. 

12

7.
REPAIR. 

    7.1. Landlord
shall have no obligation to alter, remodel, improve, repair, decorate or paint
the Premises, except as specified in Exhibit B if attached to this Lease and
except that Landlord shall repair and maintain the structural portions of the
Building, including the basic plumbing, air conditioning, heating and electrical
systems installed or furnished by Landlord. By taking possession of the
Premises, Tenant accepts them as being in good order, condition and repair and
in the condition in which Landlord is obligated to deliver them, except as set
forth in the punch list to be delivered pursuant to Section 2.1. It is hereby
understood and agreed that no representations respecting the condition of the
Premises or the Building have been made by Landlord to Tenant, except as
specifically set forth in this Lease. 

    7.2. Tenant
shall, at all times during the Term, keep the Premises in good condition and
repair excepting damage by fire, or other casualty, and in compliance with all
applicable governmental laws, ordinances and regulations, promptly complying
with all governmental orders and directives for the correction, prevention and
abatement of any violations or nuisances in or upon, or connected with, the
Premises, all at Tenant’s sole expense. 

    7.3. Landlord
shall not be liable for any failure to make any repairs or to perform any
maintenance unless such failure shall persist for an unreasonable time after
written notice of the need of such repairs or maintenance is given to Landlord
by Tenant. 

    7.4. Except
as provided in Article 22, there shall be no abatement of rent and no liability
of Landlord by reason of any injury to or interference with Tenant’s business
arising from the making of any repairs, alterations or improvements in or to any
portion of the Building or the Premises or to fixtures, appurtenances and
equipment in the Building. Except to the extent, if any, prohibited by law,
Tenant waives the right to make repairs at Landlord’s expense under any law,
statute or ordinance now or hereafter in effect. 

8.
LIENS. 

    8.1. Tenant
shall keep the Premises, the Building and appurtenant land and Tenant’s
leasehold interest in the Premises free from any liens arising out of any
services, work or materials performed, furnished, or contracted for by Tenant,
or obligations incurred by Tenant. In the event that Tenant fails, within ten
(10) days following the imposition of any such lien, to either cause the same to
be released of record or provide Landlord with insurance against the same issued
by a major title insurance company or such other protection against the same as
Landlord shall accept (such failure to constitute an Event of Default), Landlord
shall have the right to cause the same to be released by such means as it shall
deem proper, including payment of the claim giving rise to such lien. All such
sums paid by Landlord and all expenses incurred by it in connection therewith
shall be payable to it by Tenant within five (5) days Landlord’s demand.

 

13

9.
ASSIGNMENT AND SUBLETTING. 

    9.1. Tenant
shall not have the right to assign or pledge this Lease or to sublet the whole
or any part of the Premises whether voluntarily or by operation of law, or
permit the use or occupancy of the Premises by anyone other than Tenant, and
shall not make, suffer or permit such assignment, subleasing or occupancy
without the prior written consent of Landlord, such consent not to be
unreasonably withheld, and said restrictions shall be binding upon any and all
assignees of the Lease and subtenants of the Premises. In the event Tenant
desires to sublet, or permit such occupancy of, the Premises, or any portion
thereof, or assign this Lease, Tenant shall give written notice thereof to
Landlord at least sixty (60) days but no more than one hundred twenty (120) days
prior to the proposed commencement date of such subletting or assignment, which
notice shall set forth the name of the proposed subtenant or assignee, the
relevant terms of any sublease or assignment and copies of financial reports and
other relevant financial information of the proposed subtenant or assignee.

    9.2.
Notwithstanding any assignment or subletting, permitted or otherwise, Tenant
shall at all times remain directly, primarily and fully responsible and liable
for the payment of the rent specified in this Lease and for compliance with all
of its other obligations under the terms, provisions and covenants of this
Lease. Upon the occurrence of an Event of Default, if the Premises or any part
of them are then assigned or sublet, Landlord, in addition to any other remedies
provided in this Lease or provided by law, may, at its option, collect directly
from such assignee or subtenant all rents due and becoming due to Tenant under
such assignment or sublease and apply such rent against any sums due to Landlord
from Tenant under this Lease, and no such collection shall be construed to
constitute a novation or release of Tenant from the further performance of
Tenant’s obligations under this Lease. 

    9.3. In
addition to Landlord’s right to approve of any subtenant or assignee, Landlord
shall have the option, in its sole discretion, in the event of any proposed
subletting or assignment, to terminate this Lease, or in the case of a proposed
subletting of less than the entire Premises, to recapture the portion of the
Premises to be sublet, as of the date the subletting or assignment is to be
effective. The option shall be exercised, if at all, by Landlord giving Tenant
written notice given by Landlord to Tenant within thirty (30) days following
Landlord’s receipt of Tenant’s written notice as required above. However, if
Tenant notifies Landlord, within five (5) days after receipt of Landlord’s
termination notice, that Tenant is rescinding its proposed assignment or
sublease, the termination notice shall be void and the Lease shall continue in
full force and effect; provided, however, Tenant’s failure to rescind its
proposed assignment or sublease shall be deemed a waiver of such rescission
right by Tenant. If this Lease shall be terminated with respect to the entire
Premises pursuant to this Section, the Term of this Lease shall end on the date
stated in Tenant’s notice as the effective date of the sublease or assignment as
if that date had been originally fixed in this Lease for the expiration of the
Term. If Landlord recaptures under this Section only a portion of the Premises,
the rent to be paid from time to time during the unexpired Term shall abate
proportionately based on the proportion by which the approximate square footage
of the remaining portion of the Premises shall be less than that of the Premises
as of the date immediately prior to such recapture. Tenant shall, at Tenant’s
own cost and expense, discharge in full any outstanding commission obligation
which may be due and owing as a result of any proposed assignment or subletting,
whether or not the Premises are recaptured pursuant to this Section 9.3 and
rented by Landlord to the proposed tenant or any other tenant. 

14

    9.4. In the
event that Tenant sells, sublets, assigns or transfers this Lease, Tenant shall
pay to Landlord as additional rent an amount equal to one hundred percent (100%)
of any Increased Rent (as defined below), less the Costs Component (as defined
below), when and as such Increased Rent is received by Tenant. As used in this
Section, “Increased
Rent” shall
mean the excess of (i) all rent and other consideration which Tenant is entitled
to receive by reason of any sale, sublease, assignment or other transfer of this
Lease, over (ii) the rent otherwise payable by Tenant under this Lease at such
time. For purposes of the foregoing, any consideration received by Tenant in
form other than cash shall be valued at its fair market value as determined by
Landlord in good faith. The “Costs
Component” is that
amount which, if paid monthly, would fully amortize on a straight-line basis,
over the entire period for which Tenant is to receive Increased Rent, the
reasonable costs incurred by Tenant for leasing commissions and tenant
improvements in connection with such sublease, assignment or other transfer;
(excluding therefrom, however, any costs or expenses attributable to any vacancy
factor). 

    9.5.
Notwithstanding any other provision hereof, it shall be considered reasonable
for Landlord to withhold its consent to any assignment of this Lease or sublease
of any portion of the Premises if at the time of either Tenant’s notice of the
proposed assignment or sublease or the proposed commencement date thereof, there
shall exist any uncured default of Tenant or matter which will become a default
of Tenant with passage of time unless cured, or if the proposed assignee or
sublessee is an entity: (a) with which Landlord is already in negotiation; (b)
is already an occupant of the Building unless Landlord is unable to provide the
amount of space required by such occupant; (c) is a governmental agency; (d) is
incompatible with the character of occupancy of the Building; (e) with which the
payment for the sublease or assignment is determined in whole or in part based
upon its net income or profits; or (f) would subject the Premises to a use which
would: (i) involve increased personnel or wear upon the Building; (ii) violate
any exclusive right granted to another tenant of the Building; (iii) require any
addition to or modification of the Premises or the Building in order to comply
with building code or other governmental requirements; or, (iv) involve a
violation of Section 1.2. Tenant expressly agrees that for the purposes of any
statutory or other requirement of reasonableness on the part of Landlord,
Landlord’s refusal to consent to any assignment or sublease for any of the
reasons described in this Section 9.5, shall be conclusively deemed to be
reasonable. 

    9.6. Upon any
request to assign or sublet, Tenant will pay to Landlord the
Assignment/Subletting Fee plus, on demand, a sum equal to all of Landlord’s
costs, including reasonable attorney’s fees, incurred in investigating and
considering any proposed or purported assignment or pledge of this Lease or
sublease of any of the Premises, regardless of whether Landlord shall consent
to, refuse consent, or determine that Landlord’s consent is not required for,
such assignment, pledge or sublease. Any purported sale, assignment, mortgage,
transfer of this Lease or subletting which does not comply with the provisions
of this Article 9 shall be void. 

    9.7. If
Tenant is a corporation, limited liability company, partnership or trust, any
transfer or transfers of or change or changes within any twelve (12) month
period in the number of the outstanding voting shares of the corporation or
limited liability company, the general partnership interests in the partnership
or the identity of the persons or entities controlling the activities of such
partnership or trust resulting in the persons or entities owning or controlling
a majority of such shares, partnership interests or activities of such
partnership or trust at the beginning of such period no longer having such
ownership or control shall be regarded as equivalent to an assignment of this
Lease to the persons or entities acquiring such ownership or control and shall
be subject to all the provisions of this Article 9 to the same extent and for
all intents and purposes as though such an assignment. 

15

10.
INDEMNIFICATION. 

    10.1. None of
the Landlord Entities shall be liable and Tenant hereby waives all claims
against them for any damage to any property or any injury to any person in or
about the Premises or the Building by or from any cause whatsoever (including
without limiting the foregoing, rain or water leakage of any character from the
roof, windows, walls, basement, pipes, plumbing works or appliances, the
Building not being in good condition or repair, gas, fire, oil, electricity or
theft), except to the extent caused by or arising from the gross negligence or
willful misconduct of Landlord or its agents, employees or contractors. Tenant
shall protect, indemnify and hold the Landlord Entities harmless from and
against any and all loss, claims, liability or costs (including court costs and
attorney’s fees) incurred by reason of (a) any damage to any property (including
but not limited to property of any Landlord Entity) or any injury (including but
not limited to death) to any person occurring in, on or about the Premises or
the Building to the extent that such injury or damage shall be caused by or
arise from any actual or alleged act, neglect, fault, or omission by or of
Tenant or any Tenant Entity to meet any standards imposed by any duty with
respect to the injury or damage; (b) the conduct or management of any work or
thing whatsoever done by the Tenant in or about the Premises or from
transactions of the Tenant concerning the Premises; (c) Tenant’s failure to
comply with any and all governmental laws, ordinances and regulations applicable
to the condition or use of the Premises or its occupancy; or (d) any breach or
default on the part of Tenant in the performance of any covenant or agreement on
the part of the Tenant to be performed pursuant to this Lease. The provisions of
this Article shall survive the termination of this Lease with respect to any
claims or liability accruing prior to such termination. 

11.
INSURANCE. 

     11.1. Tenant shall keep in force
throughout the Term: (a) a Commercial General Liability insurance policy or
policies to protect the Landlord Entities against any liability to the public or
to any invitee of Tenant or a Landlord Entity incidental to the use of or
resulting from any accident occurring in or upon the Premises with a limit of
not less than $1,000,000.00 per occurrence and not less than $2,000,000.00 in
the annual aggregate, or such larger amount as Landlord may prudently require
from time to time, covering bodily injury and property damage liability and
$1,000,000 products/completed operations aggregate; (b) Business Auto Liability
covering owned, non-owned and hired vehicles with a limit of not less than
$1,000,000 per accident; (c) insurance protecting against liability under
Worker’s Compensation Laws with limits at least as required by statute with
Employers Liability with limits of $500,000 each accident, $500,000 disease
policy limit, $500,000 disease--each employee; (d) All Risk or Special Form
coverage protecting Tenant against loss of or damage to Tenant’s alterations,
additions, improvements, carpeting, floor coverings, panelings, decorations,
fixtures, inventory and other business personal property situated in or about
the Premises to the full replacement value of the property so insured; and, (e)
Business Interruption Insurance with limit of liability representing loss of at
least approximately six (6) months of income. 

    11.2. The aforesaid
policies shall (a) be provided at Tenant’s expense; (b) name the Landlord
Entities as additional insureds (General Liability) and loss payee
(Property—Special Form); (c) be issued by an insurance company with a minimum
Best’s rating of “A:VII” during
the Term; and (d) provide that said insurance shall be written on an occurrence
basis and shall not be canceled unless thirty (30) days prior written notice
(ten days for non-payment of premium) shall have been given to Landlord; a
certificate of Liability insurance on ACORD Form 25 and a certificate of
Property insurance on ACORD Form 27 shall be delivered to Landlord by Tenant
upon the Commencement Date and at least thirty (30) days prior to each renewal
of said insurance. 

      11.3. Whenever Tenant shall
undertake any alterations, additions or improvements in, to or about the
Premises (“Work”) the
aforesaid insurance protection must extend to and include injuries to persons
and damage to property arising in connection with such Work, without limitation
including liability under any applicable structural work act, and such other
insurance as Landlord shall require; and the policies of or certificates
evidencing such insurance must be delivered to Landlord prior to the
commencement of any such Work. 

12.
WAIVER OF SUBROGATION. 

    12.1. So long
as their respective insurers so permit, Tenant and Landlord hereby mutually
waive their respective rights of recovery against each other for any property
loss insured by fire, extended coverage, All Risks or other insurance now or
hereafter existing for the benefit of the respective party but only to the
extent of the net insurance proceeds payable under such policies. Each party
shall obtain any special endorsements required by their insurer to evidence
compliance with the aforementioned waiver. 

13.
SERVICES AND UTILITIES. 

    13.1.
Provided Tenant shall not be in default under this Lease, and subject to the
other provisions of this Lease, Landlord agrees to furnish to the Premises
during Building Business Hours (specified on the Reference Pages) on generally
recognized business days (but exclusive in any event of Sundays and national and
local legal holidays), the following services and utilities subject to the rules
and regulations of the Building prescribed from time to time: (a) water suitable
for normal office use of the Premises; (b) heat and air conditioning required in
Landlord’s judgment for the use and occupation of the Premises during Building
Business Hours; (c) cleaning and janitorial service; (d) elevator service by
nonattended automatic elevators, if applicable; and, (e) equipment to bring to
the Premises electricity for lighting, convenience outlets and other normal
office use. To the extent that Tenant is not billed directly by a public
utility, Tenant shall pay, within five (5) days of Landlord’s demand, for all
electricity used by Tenant in the Premises. The charge shall be at the rates
charged for such services by the local public utility. Alternatively, Landlord
may elect to include electricity costs in Expenses. In the absence of Landlord’s
gross negligence or willful misconduct, Landlord shall not be liable for, and
Tenant shall not be entitled to, any abatement or reduction of rental by reason
of Landlord’s failure to furnish any of the foregoing, unless such failure shall
persist for an unreasonable time after written notice of such failure is given
to Landlord by Tenant and provided further that Landlord shall not be liable
when such failure is caused by accident, breakage, repairs, labor disputes of
any character, energy usage restrictions or by any other cause, similar or
dissimilar, beyond the reasonable control of Landlord. Landlord shall use
reasonable efforts to remedy any interruption in the furnishing of services and
utilities. 

16

    13.2. Should
Tenant require any additional work or service, as described above, including
services furnished outside ordinary business hours specified above, Landlord
may, on terms to be agreed, upon reasonable advance notice by Tenant, furnish
such additional service and Tenant agrees to pay Landlord such charges as may be
agreed upon, including any tax imposed thereon, but in no event at a charge less
than Landlord’s actual cost plus overhead for such additional service and, where
appropriate, a reasonable allowance for depreciation of any systems being used
to provide such service. The current charge for after-hours HVAC service, which
is subject to change at any time, is specified on the Reference Pages.

    13.3.
Wherever heat-generating machines or equipment are used by Tenant in the
Premises which affect the temperature otherwise maintained by the air
conditioning system or Tenant allows occupancy of the Premises by more persons
than the heating and air conditioning system is designed to accommodate, in
either event whether with or without Landlord’s approval, Landlord reserves the
right to install supplementary heating and/or air conditioning units in or for
the benefit of the Premises and the cost thereof, including the cost of
installation and the cost of operations and maintenance, shall be paid by Tenant
to Landlord within five (5) days of Landlord’s demand. 

    13.4. Tenant
will not, without the written consent of Landlord, use any apparatus or device
in the Premises, including but not limited to, electronic data processing
machines and machines using current in excess of 2000 watts and/or 20 amps or
120 volts, which will in any way increase the amount of electricity or water
usually furnished or supplied for use of the Premises for normal office use, nor
connect with electric current, except through existing electrical outlets in the
Premises, or water pipes, any apparatus or device for the purposes of using
electrical current or water. If Tenant shall require water or electric current
in excess of that usually furnished or supplied for use of the Premises as
normal office use, Tenant shall procure the prior written consent of Landlord
for the use thereof, which Landlord may refuse, and if Landlord does consent,
Landlord may cause a water meter or electric current meter to be installed so as
to measure the amount of such excess water and electric current. The cost of any
such meters shall be paid for by Tenant. Tenant agrees to pay to Landlord within
five (5) days of Landlord’s demand , the cost of all such excess water and
electric current consumed (as shown by said meters, if any, or, if none, as
reasonably estimated by Landlord) at the rates charged for such services by the
local public utility or agency, as the case may be, furnishing the same, plus
any additional expense incurred in keeping account of the water and electric
current so consumed. 

 

    13.5. Tenant
will not, without the written consent of Landlord, contract with a utility
provider to service the Premises with any utility, including, but not limited
to, telecommunications, electricity, water, sewer or gas, which is not
previously providing such service to other tenants in the Building. Subject to
Landlord’s reasonable rules and regulations and the provisions of Articles 6 and
26, Tenant shall be entitled to the use of wiring (“Communications
Wiring”) from
the existing telecommunications nexus in the Building to the Premises,
sufficient for normal general office use of the Premises. Tenant shall not
install any additional Communications Wiring, nor remove any Communications
Wiring, without in each instance obtaining the prior written consent of
Landlord, which consent may be withheld in Landlord’s sole and absolute
discretion. Landlord’s shall in no event be liable for disruption in any service
obtained by Tenant pursuant to this paragraph. 

17

14.
HOLDING OVER. 

    14.1. Tenant
shall pay Landlord for each day Tenant retains possession of the Premises or
part of them after termination of this Lease by lapse of time or otherwise at
the rate (“Holdover
Rate”) which
shall be Two Hundred Percent (200%) of the greater of (a) the amount of the
Annual Rent for the last period prior to the date of such termination plus all
Rent Adjustments under Article 4; and (b) the then market rental value of the
Premises as determined by Landlord assuming a new lease of the Premises of the
then usual duration and other terms, in either case, prorated on a daily basis,
and also pay all damages sustained by Landlord by reason of such retention. If
Landlord gives notice to Tenant of Landlord’s election to such effect, such
holding over shall constitute renewal of this Lease for a period from month to
month or one (1) year, whichever shall be specified in such notice, in either
case at the Holdover Rate, but if the Landlord does not so elect, no such
renewal shall result notwithstanding acceptance by Landlord of any sums due
hereunder after such termination; and instead, a tenancy at sufferance at the
Holdover Rate shall be deemed to have been created. In any event, no provision
of this Article 14 shall be deemed to waive Landlord’s right of reentry or any
other right under this Lease or at law. 

15.
SUBORDINATION. 

    15.1. Without
the necessity of any additional document being executed by Tenant for the
purpose of effecting a subordination, this Lease shall be subject and
subordinate at all times to ground or underlying leases and to the lien of any
mortgages or deeds of trust now or hereafter placed on, against or affecting the
Building, Landlord’s interest or estate in the Building, or any ground or
underlying lease; provided, however, that if the lessor, mortgagee, trustee, or
holder of any such mortgage or deed of trust elects to have Tenant’s interest in
this Lease be superior to any such instrument, then, by notice to Tenant, this
Lease shall be deemed superior, whether this Lease was executed before or after
said instrument. Notwithstanding the foregoing, Tenant covenants and agrees to
execute and deliver within ten (10) days of Landlord’s request such further
instruments evidencing such subordination or superiority of this Lease as may be
required by Landlord. 

16.
RULES AND REGULATIONS. 

    16.1. Tenant
shall faithfully observe and comply with all the rules and regulations as set
forth in Exhibit D to this Lease and all reasonable and non-discriminatory
modifications of and additions to them from time to time put into effect by
Landlord. Landlord shall not be responsible to Tenant for the non-performance by
any other tenant or occupant of the Building of any such rules and regulations.

 

18

17.
REENTRY BY LANDLORD. 

   17.1. Landlord
reserves and shall at all times have the right to re-enter the Premises to
inspect the same, to supply janitor service and any other service to be provided
by Landlord to Tenant under this Lease, to show said Premises to prospective
purchasers, mortgagees or tenants, and to alter, improve or repair the Premises
and any portion of the Building, without abatement of rent, and may for that
purpose erect, use and maintain scaffolding, pipes, conduits and other necessary
structures and open any wall, ceiling or floor in and through the Building and
Premises where reasonably required by the character of the work to be performed,
provided entrance to the Premises shall not be blocked thereby, and further
provided that the business of Tenant shall not be interfered with unreasonably.
Landlord shall have the right at any time to change the arrangement and/or
locations of entrances, or passageways, doors and doorways, and corridors,
windows, elevators, stairs, toilets or other public parts of the Building and to
change the name, number or designation by which the Building is commonly known.
In the event that Landlord damages any portion of any wall or wall covering,
ceiling, or floor or floor covering within the Premises, Landlord shall repair
or replace the damaged portion to match the original as nearly as commercially
reasonable but shall not be required to repair or replace more than the portion
actually damaged. Tenant hereby waives any claim for damages for any injury or
inconvenience to or interference with Tenant’s business, any loss of occupancy
or quiet enjoyment of the Premises, and any other loss occasioned by any action
of Landlord authorized by this Article 17. 

    17.2. For
each of the aforesaid purposes, Landlord shall at all times have and retain a
key with which to unlock all of the doors in the Premises, excluding Tenant’s
vaults and safes or special security areas (designated in advance), and Landlord
shall have the right to use any and all means which Landlord may deem proper to
open said doors in an emergency to obtain entry to any portion of the Premises.
As to any portion to which access cannot be had by means of a key or keys in
Landlord’s possession, Landlord is authorized to gain access by such means as
Landlord shall elect and the cost of repairing any damage occurring in doing so
shall be borne by Tenant and paid to Landlord within five (5) days of Landlord’s
demand. 

18.
DEFAULT. 

    18.1. Except
as otherwise provided in Article 20, the following events shall be deemed to be
Events of Default under this Lease: 

    18.1.1.
Tenant shall fail to pay when due any sum of money becoming due to be paid to
Landlord under this Lease, whether such sum be any installment of the rent
reserved by this Lease, any other amount treated as additional rent under this
Lease, or any other payment or reimbursement to Landlord required by this Lease,
whether or not treated as additional rent under this Lease, and such failure
shall continue for a period of five (5) days after written notice that such
payment was not made when due, but if any such notice shall be given, for the
twelve (12) month period commencing with the date of such notice, the failure to
pay within five (5) days after due any additional sum of money becoming due to
be paid to Landlord under this Lease during such period shall be an Event of
Default, without notice. 

    18.1.2.
Tenant shall fail to comply with any term, provision or covenant of this Lease
which is not provided for in another Section of this Article and shall not cure
such failure within twenty (20) days (forthwith, if the failure involves a
hazardous condition) after written notice of such failure to Tenant provided,
however, that such failure shall not be an event of default if such failure
could not reasonably be cured during such twenty (20) day period, Tenant has
commenced the cure within such twenty (20) day period and thereafter is
diligently pursuing such cure to completion, but the total aggregate cure period
shall not exceed ninety (90) days. 

    18.1.3.
Tenant shall fail to vacate the Premises immediately upon termination of this
Lease, by lapse of time or otherwise, or upon termination of Tenant’s right to
possession only. 

    18.1.4.
Tenant shall become insolvent, admit in writing its inability to pay its debts
generally as they become due, file a petition in bankruptcy or a petition to
take advantage of any insolvency statute, make an assignment for the benefit of
creditors, make a transfer in fraud of creditors, apply for or consent to the
appointment of a receiver of itself or of the whole or any substantial part of
its property, or file a petition or answer seeking reorganization or arrangement
under the federal bankruptcy laws, as now in effect or hereafter amended, or any
other applicable law or statute of the United States or any state thereof.

    18.1.5. A
court of competent jurisdiction shall enter an order, judgment or decree
adjudicating Tenant bankrupt, or appointing a receiver of Tenant, or of the
whole or any substantial part of its property, without the consent of Tenant, or
approving a petition filed against Tenant seeking reorganization or arrangement
of Tenant under the bankruptcy laws of the United States, as now in effect or
hereafter amended, or any state thereof, and such order, judgment or decree
shall not be vacated or set aside or stayed within sixty (60) days from the date
of entry thereof. 

    18.1.6. Any
Event of Default by Talk America Holdings, Inc. as that term is defined by the
Reston II Lease shall be an Event of Default hereunder without any notice or
opportunity for cure. 

    18.1.7.
Guarantor shall become insolvent, admit in writing its inability to pay its
debts generally as they become due, file a petition in bankruptcy or a petition
to take advantage of any insolvency statute, make an assignment for the benefit
of creditors, make a transfer in fraud of creditors, apply for or consent to the
appointment of a receiver of itself or of the whole or any substantial part of
its property, or file a petition or answer seeking reorganization or arrangement
under the federal bankruptcy laws, as now in effect or hereafter amended, or any
other applicable law or statute of the United States or any state thereof.

 

    18.1.8. A
court of competent jurisdiction shall enter an order, judgment or decree
adjudicating Guarantor bankrupt, or appointing a receiver of Guarantor, or of
the whole or any substantial part of its property, without the consent of
Guarantor, or approving a petition filed against Guarantor seeking
reorganization or arrangement of Guarantor under the bankruptcy laws of the
United States, as now in effect or hereafter amended, or any state thereof, and
such order, judgment or decree shall not be vacated or set aside or stayed
within sixty (60) days from the date of entry thereof. 

 

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19.
REMEDIES. 

    19.1. Except
as otherwise provided in Article 20, upon the occurrence of any of the Events of
Default described or referred to in Article 18, Landlord shall have the option
to pursue any one or more of the following remedies without any notice or demand
whatsoever, concurrently or consecutively and not alternatively: 

      19.1.1. Landlord
may, at its election, terminate this Lease or terminate Tenant’s right to
possession only, without terminating the Lease. 

       19.1.2. Upon any termination of
this Lease, whether by lapse of time or otherwise, or upon any termination of
Tenant’s right to possession without termination of the Lease, Tenant shall
surrender possession and vacate the Premises immediately, and deliver possession
thereof to Landlord, and Tenant hereby grants to Landlord full and free license
to enter into and upon the Premises in such event and to repossess Landlord of
the Premises as of Landlord’s former estate and to expel or remove Tenant and
any others who may be occupying or be within the Premises and to remove Tenant’s
signs and other evidence of tenancy and all other property of Tenant therefrom
without being deemed in any manner guilty of trespass, eviction or forcible
entry or detainer, and without incurring any liability for any damage resulting
therefrom, Tenant waiving any right to claim damages for such re-entry and
expulsion, and without relinquishing Landlord’s right to rent or any other right
given to Landlord under this Lease or by operation of law. 

        19.1.3. Upon any
termination of this Lease, whether by lapse of time or otherwise, Landlord shall
be entitled to recover as damages, all rent, including any amounts treated as
additional rent under this Lease, and other sums due and payable by Tenant on
the date of termination, plus as liquidated damages and not as a penalty, an
amount equal to the sum of: (a) an amount equal to the then present value of the
rent reserved in this Lease for the residue of the stated Term of this Lease
including any amounts treated as additional rent under this Lease and all other
sums provided in this Lease to be paid by Tenant, minus the fair rental value of
the Premises for such residue; (b) the value of the time and expense necessary
to obtain a replacement tenant or tenants, and the estimated expenses described
in Section 19.1.4 relating to recovery of the Premises, preparation for
reletting and for reletting itself; and (c) the cost of performing any other
covenants which would have otherwise been performed by Tenant. 

 

        19.1.4. Upon any
termination of Tenant’s right to possession only without termination of the
Lease: 

        19.1.4.1. Neither
such termination of Tenant’s right to possession nor Landlord’s taking and
holding possession thereof as provided in Section 19.1.2 shall terminate the
Lease or release Tenant, in whole or in part, from any obligation, including
Tenant’s obligation to pay the rent, including any amounts treated as additional
rent, under this Lease for the full Term, and if Landlord so elects Tenant shall
continue to pay to Landlord the entire amount of the rent as and when it becomes
due, including any amounts treated as additional rent under this Lease, for the
remainder of the Term plus any other sums provided in this Lease to be paid by
Tenant for the remainder of the Term. 

20

        19.1.4.2. Landlord
shall use commercially reasonable efforts to relet the Premises or portions
thereof to the extent required by applicable law. Landlord and Tenant agree that
nevertheless Landlord shall at most be required to use only the same efforts
Landlord then uses to lease premises in the Building generally and that in any
case that Landlord shall not be required to give any preference or priority to
the showing or leasing of the Premises or portions thereof over any other space
that Landlord may be leasing or have available and may place a suitable
prospective tenant in any such other space regardless of when such other space
becomes available and that Landlord shall have the right to relet the Premises
for a greater or lesser term than that remaining under this Lease, the right to
relet only a portion of the Premises, or a portion of the Premises or the entire
Premises as a part of a larger area, and the right to change the character or
use of the Premises. In connection with or in preparation for any reletting,
Landlord may, but shall not be required to, make repairs, alterations and
additions in or to the Premises and redecorate the same to the extent Landlord
deems necessary or desirable, and Tenant shall pay the cost thereof, together
with Landlord’s expenses of reletting, including, without limitation, any
commission incurred by Landlord, within five (5) days of Landlord’s demand.
Landlord shall not be required to observe any instruction given by Tenant about
any reletting or accept any tenant offered by Tenant unless such offered tenant
has a credit-worthiness acceptable to Landlord and leases the entire Premises
upon terms and conditions including a rate of rent (after giving effect to all
expenditures by Landlord for tenant improvements, broker’s commissions and other
leasing costs) all no less favorable to Landlord than as called for in this
Lease, nor shall Landlord be required to make or permit any assignment or
sublease for more than the current term or which Landlord would not be required
to permit under the provisions of Article 9. 

        19.1.4.3. Until such
time as Landlord shall elect to terminate the Lease and shall thereupon be
entitled to recover the amounts specified in such case in Section 19.1.3, Tenant
shall pay to Landlord upon demand the full amount of all rent, including any
amounts treated as additional rent under this Lease and other sums reserved in
this Lease for the remaining Term, together with the costs of repairs,
alterations, additions, redecorating and Landlord’s expenses of reletting and
the collection of the rent accruing therefrom (including reasonable attorney’s
fees and broker’s commissions), as the same shall then be due or become due from
time to time, less only such consideration as Landlord may have received from
any reletting of the Premises; and Tenant agrees that Landlord may file suits
from time to time to recover any sums falling due under this Article 19 as they
become due. Any proceeds of reletting by Landlord in excess of the amount then
owed by Tenant to Landlord from time to time shall be credited against Tenant’s
future obligations under this Lease but shall not otherwise be refunded to
Tenant or inure to Tenant’s benefit. 

    19.2. Upon
the occurrence of an Event of Default, Landlord may (but shall not be obligated
to) cure such default at Tenant’s sole expense. Without limiting the generality
of the foregoing, Landlord may, at Landlord’s option, enter into and upon the
Premises if Landlord determines in its sole discretion that Tenant is not acting
within a commercially reasonable time to maintain, repair or replace anything
for which Tenant is responsible under this Lease or to otherwise effect
compliance with its obligations under this Lease and correct the same, without
being deemed in any manner guilty of trespass, eviction or forcible entry and
detainer and without incurring any liability for any damage or interruption of
Tenant’s business resulting therefrom and Tenant agrees to reimburse Landlord
within five (5) days of Landlord’s demand as additional rent, for any expenses
which Landlord may incur in thus effecting compliance with Tenant’s obligations
under this Lease, plus interest from the date of expenditure by Landlord at the
Wall Street Journal prime rate. 

21

    19.3. Tenant
understands and agrees that in entering into this Lease, Landlord is relying
upon receipt of all the Annual and Monthly Installments of Rent to become due
with respect to all the Premises originally leased hereunder over the full
Initial Term of this Lease for amortization, including interest at the
Amortization Rate. For purposes hereof, the “Concession
Amount” shall
be defined as the aggregate of all amounts forgone or expended by Landlord as
free rent under the lease, under Exhibit B hereof for construction
allowances (excluding therefrom any amounts expended by Landlord for Landlord’s
Work, as defined in Exhibit B), and
for brokers’ commissions payable by reason of this Lease. Accordingly, Tenant
agrees that if this Lease or Tenant’s right to possession of the Premises leased
hereunder shall be terminated as of any date (“Default
Termination Date”) prior
to the expiration of the full Initial Term hereof by reason of a default of
Tenant, there shall be due and owing to Landlord as of the day prior to the
Default Termination Date, as rent in addition to all other amounts owed by
Tenant as of such Date, the amount (“Unamortized
Amount”) of the
Concession Amount determined as set forth below; provided, however, that in the
event that such amounts are recovered by Landlord pursuant to any other
provision of this Article 19, Landlord agrees that it shall not attempt to
recover such amounts pursuant to this Paragraph 

    19.4. If, on
account of any breach or default by Tenant in Tenant’s obligations under the
terms and conditions of this Lease, it shall become necessary or appropriate for
Landlord to employ or consult with an attorney or collection agency concerning
or to enforce or defend any of Landlord’s rights or remedies arising under this
Lease or to collect any sums due from Tenant, Tenant agrees to pay all costs and
fees so incurred by Landlord, including, without limitation, reasonable
attorneys’ fees and costs. TENANT EXPRESSLY WAIVES ANY RIGHT TO: (A) TRIAL BY
JURY; AND (B) SERVICE OF ANY NOTICE REQUIRED BY ANY PRESENT OR FUTURE LAW OR
ORDINANCE APPLICABLE TO LANDLORDS OR TENANTS BUT NOT REQUIRED BY THE TERMS OF
THIS LEASE. 

    19.5. Pursuit
of any of the foregoing remedies shall not preclude pursuit of any of the other
remedies provided in this Lease or any other remedies provided by law (all such
remedies being cumulative), nor shall pursuit of any remedy provided in this
Lease constitute a forfeiture or waiver of any rent due to Landlord under this
Lease or of any damages accruing to Landlord by reason of the violation of any
of the terms, provisions and covenants contained in this Lease. 

    19.6. No act
or thing done by Landlord or its agents during the Term shall be deemed a
termination of this Lease or an acceptance of the surrender of the Premises, and
no agreement to terminate this Lease or accept a surrender of said Premises
shall be valid, unless in writing signed by Landlord. No waiver by Landlord of
any violation or breach of any of the terms, provisions and covenants contained
in this Lease shall be deemed or construed to constitute a waiver of any other
violation or breach of any of the terms, provisions and covenants contained in
this Lease. Landlord’s acceptance of the payment of rental or other payments
after the occurrence of an Event of Default shall not be construed as a waiver
of such Default, unless Landlord so notifies Tenant in writing. Forbearance by
Landlord in enforcing one or more of the remedies provided in this Lease upon an
Event of Default shall not be deemed or construed to constitute a waiver of such
Default or of Landlord’s right to enforce any such remedies with respect to such
Default or any subsequent Default. 

22

    19.7. Any and
all property which may be removed from the Premises by Landlord pursuant to the
authority of this Lease or of law, to which Tenant is or may be entitled, may be
handled, removed and/or stored, as the case may be, by or at the direction of
Landlord but at the risk, cost and expense of Tenant, and Landlord shall in no
event be responsible for the value, preservation or safekeeping thereof. Tenant
shall pay to Landlord, upon demand, any and all expenses incurred in such
removal and all storage charges against such property so long as the same shall
be in Landlord’s possession or under Landlord’s control. Any such property of
Tenant not retaken by Tenant from storage within thirty (30) days after removal
from the Premises shall, at Landlord’s option, be deemed conveyed by Tenant to
Landlord under this Lease as by a bill of sale without further payment or credit
by Landlord to Tenant. 

    19.8. If more
than one (1) Event of Default occurs during the Term or any renewal thereof,
Tenant’s renewal options, expansion options, purchase options and rights of
first offer and/or refusal, if any are provided for in this Lease, shall be null
and void. 

20.
TENANT’S BANKRUPTCY OR INSOLVENCY. 

    20.1. If at
any time and for so long as Tenant shall be subjected to the provisions of the
United States Bankruptcy Code or other law of the United States or any state
thereof for the protection of debtors as in effect at such time (each a
“Debtor’s
Law”):

        20.1.1. Tenant,
Tenant as debtor-in-possession, and any trustee or receiver of Tenant’s assets
(each a “Tenant’s
Representative”) shall
have no greater right to assume or assign this Lease or any interest in this
Lease, or to sublease any of the Premises than accorded to Tenant in Article 9,
except to the extent Landlord shall be required to permit such assumption,
assignment or sublease by the provisions of such Debtor’s Law. Without
limitation of the generality of the foregoing, any right of any Tenant’s
Representative to assume or assign this Lease or to sublease any of the Premises
shall be subject to the conditions that: 

        20.1.1.1. Such
Debtor’s Law shall provide to Tenant’s Representative a right of assumption of
this Lease which Tenant’s Representative shall have timely exercised and
Tenant’s Representative shall have fully cured any default of Tenant under this
Lease. 

 

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        20.1.1.2. Tenant’s
Representative or the proposed assignee, as the case shall be, shall have
deposited with Landlord as security for the timely payment of rent an amount
equal to the larger of: (a) three (3) months’ rent and other monetary charges
accruing under this Lease; and (b) any sum specified in Article 4; and shall
have provided Landlord with adequate other assurance of the future performance
of the obligations of the Tenant under this Lease. Without limitation, such
assurances shall include, at least, in the case of assumption of this Lease,
demonstration to the satisfaction of the Landlord that Tenant’s Representative
has and will continue to have sufficient unencumbered assets after the payment
of all secured obligations and administrative expenses to assure Landlord that
Tenant’s Representative will have sufficient funds to fulfill the obligations of
Tenant under this Lease; and, in the case of assignment, submission of current
financial statements of the proposed assignee, audited by an independent
certified public accountant reasonably acceptable to Landlord and showing a net
worth and working capital in amounts determined by Landlord to be sufficient to
assure the future performance by such assignee of all of the Tenant’s
obligations under this Lease. 

        20.1.1.3. The
assumption or any contemplated assignment of this Lease or subleasing any part
of the Premises, as shall be the case, will not breach any provision in any
other lease, mortgage, financing agreement or other agreement by which Landlord
is bound. 

        20.1.1.4. Landlord
shall have, or would have had absent the Debtor’s Law, no right under Article 9
to refuse consent to the proposed assignment or sublease by reason of the
identity or nature of the proposed assignee or sublessee or the proposed use of
the Premises concerned. 

21.
QUIET ENJOYMENT. 

    21.1.
Landlord represents and warrants that it has full right and authority to enter
into this Lease and that Tenant, while paying the rental and performing its
other covenants and agreements contained in this Lease, shall peaceably and
quietly have, hold and enjoy the Premises for the Term without hindrance or
molestation from Landlord subject to the terms and provisions of this Lease.
Landlord shall not be liable for any interference or disturbance by other
tenants or third persons, nor shall Tenant be released from any of the
obligations of this Lease because of such interference or disturbance.

 

24

22.
CASUALTY - 22 -
M:\26954\Reston I\Talk America Holdings\Talk America, Inc. Lease Agreement.doc
10/28/2004 9:59 AM 

    22.1. In the
event the Premises or the Building are damaged by fire or other cause and in
Landlord’s reasonable estimation such damage can be materially restored within
one hundred eighty (180) days, Landlord shall forthwith repair the same and this
Lease shall remain in full force and effect, except that Tenant shall be
entitled to a proportionate abatement in rent from the date of such damage. Such
abatement of rent shall be made pro rata in accordance with the extent to which
the damage and the making of such repairs shall interfere with the use and
occupancy by Tenant of the Premises from time to time. Within forty-five (45)
days from the date of such damage, Landlord shall notify Tenant, in writing, of
Landlord’s reasonable estimation of the length of time within which material
restoration can be made, and Landlord’s determination shall be binding on
Tenant. For purposes of this Lease, the Building or Premises shall be deemed
“materially
restored” if they
are in such condition as would not prevent or materially interfere with Tenant’s
use of the Premises for the purpose for which it was being used immediately
before such damage. 

    22.2. If such
repairs cannot, in Landlord’s reasonable estimation, be made within one hundred
eighty (180) days, Landlord and Tenant shall each have the option of giving the
other, at any time within ninety (90) days after such damage, notice terminating
this Lease as of the date of such damage. In the event of the giving of such
notice, this Lease shall expire and all interest of the Tenant in the Premises
shall terminate as of the date of such damage as if such date had been
originally fixed in this Lease for the expiration of the Term. In the event that
neither Landlord nor Tenant exercises its option to terminate this Lease, then
Landlord shall repair or restore such damage, this Lease continuing in full
force and effect, and the rent hereunder shall be proportionately abated as
provided in Section 22.1. 

    22.3.
Landlord shall not be required to repair or replace any damage or loss by or
from fire or other cause to any panelings, decorations, partitions, additions,
railings, ceilings, floor coverings, office fixtures or any other property or
improvements installed on the Premises by, or belonging to, Tenant. Any
insurance which may be carried by Landlord or Tenant against loss or damage to
the Building or Premises shall be for the sole benefit of the party carrying
such insurance and under its sole control. 

    22.4. In the
event that Landlord should fail to complete such repairs and material
restoration within sixty (60) days after the date estimated by Landlord therefor
as extended by this Section 22.4, Tenant may at its option and as its sole
remedy terminate this Lease by delivering written notice to Landlord, within
fifteen (15) days after the expiration of said period of time, whereupon the
Lease shall end on the date of such notice or such later date fixed in such
notice as if the date of such notice was the date originally fixed in this Lease
for the expiration of the Term; provided, however, that if construction is
delayed because of changes, deletions or additions in construction requested by
Tenant, strikes, lockouts, casualties, Acts of God, war, material or labor
shortages, government regulation or control or other causes beyond the
reasonable control of Landlord, the period for restoration, repair or rebuilding
shall be extended for the amount of time Landlord is so delayed. 

25

    22.5.
Notwithstanding anything to the contrary contained in this Article: (a) Landlord
shall not have any obligation whatsoever to repair, reconstruct, or restore the
Premises when the damages resulting from any casualty covered by the provisions
of this Article 22 occur during the last twelve (12) months of the Term or any
extension thereof, but if Landlord determines not to repair such damages
Landlord shall notify Tenant and if such damages shall render any material
portion of the Premises untenantable Tenant shall have the right to terminate
this Lease by notice to Landlord within fifteen (15) days after receipt of
Landlord’s notice; and (b) in the event the holder of any indebtedness secured
by a mortgage or deed of trust covering the Premises or Building requires that
any insurance proceeds be applied to such indebtedness, then Landlord shall have
the right to terminate this Lease by delivering written notice of termination to
Tenant within fifteen (15) days after such requirement is made by any such
holder, whereupon this Lease shall end on the date of such damage as if the date
of such damage were the date originally fixed in this Lease for the expiration
of the Term. 

    22.6. In the
event of any damage or destruction to the Building or Premises by any peril
covered by the provisions of this Article 22, it shall be Tenant’s
responsibility to properly secure the Premises and upon notice from Landlord to
remove forthwith, at its sole cost and expense, such portion of all of the
property belonging to Tenant or its licensees from such portion or all of the
Building or Premises as Landlord shall request. 

23.
EMINENT DOMAIN. 

    23.1. If all
or any substantial part of the Premises shall be taken or appropriated by any
public or quasi-public authority under the power of eminent domain, or
conveyance in lieu of such appropriation, either party to this Lease shall have
the right, at its option, of giving the other, at any time within thirty (30)
days after such taking, notice terminating this Lease, except that Tenant may
only terminate this Lease by reason of taking or appropriation, if such taking
or appropriation shall be so substantial as to materially interfere with
Tenant’s use and occupancy of the Premises. If neither party to this Lease shall
so elect to terminate this Lease, the rental thereafter to be paid shall be
adjusted on a fair and equitable basis under the circumstances. In addition to
the rights of Landlord above, if any substantial part of the Building shall be
taken or appropriated by any public or quasi-public authority under the power of
eminent domain or conveyance in lieu thereof, and regardless of whether the
Premises or any part thereof are so taken or appropriated, Landlord shall have
the right, at its sole option, to terminate this Lease. Landlord shall be
entitled to any and all income, rent, award, or any interest whatsoever in or
upon any such sum, which may be paid or made in connection with any such public
or quasi-public use or purpose, and Tenant hereby assigns to Landlord any
interest it may have in or claim to all or any part of such sums, other than any
separate award which may be made with respect to Tenant’s trade fixtures and
moving expenses; Tenant shall make no claim for the value of any unexpired Term.

26

24.
SALE BY LANDLORD. 

    24.1. In
event of a sale or conveyance by Landlord of the Building, the same shall
operate to release Landlord from any future liability upon any of the covenants
or conditions, expressed or implied, contained in this Lease in favor of Tenant,
and in such event Tenant agrees to look solely to the responsibility of the
successor in interest of Landlord in and to this Lease. Except as set forth in
this Article 24, this Lease shall not be affected by any such sale and Tenant
agrees to attorn to the purchaser or assignee. If any security has been given by
Tenant to secure the faithful performance of any of the covenants of this Lease,
Landlord may transfer or deliver said security, as such, to Landlord’s successor
in interest and thereupon Landlord shall be discharged from any further
liability with regard to said security. 

 

25.
ESTOPPEL CERTIFICATES. 

    25.1. Within
ten (10) days following any written request which Landlord may make from time to
time, Tenant shall execute and deliver to Landlord or mortgagee or prospective
mortgagee a sworn statement certifying: (a) the date of commencement of this
Lease; (b) the fact that this Lease is unmodified and in full force and effect
(or, if there have been modifications to this Lease, that this lease is in full
force and effect, as modified, and stating the date and nature of such
modifications); (c) the date to which the rent and other sums payable under this
Lease have been paid; (d) the fact that there are no current defaults under this
Lease by either Landlord or Tenant except as specified in Tenant’s statement;
and (e) such other matters as may be requested by Landlord. Landlord and Tenant
intend that any statement delivered pursuant to this Article 25 may be relied
upon by any mortgagee, beneficiary or purchaser, and Tenant shall be liable for
all loss, cost or expense resulting from the failure of any sale or funding of
any loan caused by any material misstatement contained in such estoppel
certificate. Tenant irrevocably agrees that if Tenant fails to execute and
deliver such certificate within such ten (10) day period Landlord or Landlord’s
beneficiary or agent may execute and deliver such certificate on Tenant’s
behalf, and that such certificate shall be fully binding on Tenant.

26.
SURRENDER OF PREMISES. 

    26.1. Tenant
shall arrange to meet Landlord for two (2) joint inspections of the Premises,
the first to occur at least thirty (30) days (but no more than sixty (60) days)
before the last day of the Term, and the second to occur not later than
forty-eight (48) hours after Tenant has vacated the Premises. In the event of
Tenant’s failure to arrange such joint inspections and/or participate in either
such inspection, Landlord’s inspection at or after Tenant’s vacating the
Premises shall be conclusively deemed correct for purposes of determining
Tenant’s responsibility for repairs and restoration. 

    26.2. All
alterations, additions, and improvements in, on, or to the Premises made or
installed by or for Tenant, including carpeting (collectively, “Alterations”), shall
be and remain the property of Tenant during the Term. Upon the expiration or
sooner termination of the Term, all Alterations shall become a part of the
realty and shall belong to Landlord without compensation, and title shall pass
to Landlord under this Lease as by a bill of sale. At the end of the Term or any
renewal of the Term or other sooner termination of this Lease, Tenant will
peaceably deliver up to Landlord possession of the Premises, together with all
Alterations by whomsoever made, in the same conditions received or first
installed, broom clean and free of all debris, excepting only ordinary wear and
tear and damage by fire or other casualty. Notwithstanding the foregoing, if
Landlord elects by notice given to Tenant at least ten (10) days prior to
expiration of the Term, Tenant shall, at Tenant’s sole cost, remove any
Alterations, including carpeting, so designated by Landlord’s notice, and repair
any damage caused by such removal. Tenant must, at Tenant’s sole cost, remove
upon termination of this Lease, any and all of Tenant’s furniture, furnishings,
movable partitions of less than full height from floor to ceiling and other
trade fixtures and personal property (collectively, “Personalty”).
Personalty not so removed shall be deemed abandoned by the Tenant and title to
the same shall thereupon pass to Landlord under this Lease as by a bill of sale,
but Tenant shall remain responsible for the cost of removal and disposal of such
Personalty, as well as any damage caused by such removal. In lieu of requiring
Tenant to remove Alterations and Personalty and repair the Premises as
aforesaid, Landlord may, by written notice to Tenant delivered at least thirty
(30) days before the Termination Date, require Tenant to pay to Landlord, as
additional rent hereunder, the cost of such removal and repair in an amount
reasonably estimated by Landlord. 

 

27

    26.3. All
obligations of Tenant under this Lease not fully performed as of the expiration
or earlier termination of the Term shall survive the expiration or earlier
termination of the Term Upon the expiration or earlier termination of the Term,
Tenant shall pay to Landlord the amount, as estimated by Landlord, necessary to
repair and restore the Premises as provided in this Lease and/or to discharge
Tenant’s obligation for unpaid amounts due or to become due to Landlord. All
such amounts shall be used and held by Landlord for payment of such obligations
of Tenant, with Tenant being liable for any additional costs upon demand by
Landlord, or with any excess to be returned to Tenant after all such obligations
have been determined and satisfied. Any otherwise unused Security Deposit shall
be credited against the amount payable by Tenant under this Lease. 

27.
NOTICES. 

    27.1. Any
notice or document required or permitted to be delivered under this Lease shall
be addressed to the intended recipient, by fully prepaid registered or certified
United States Mail return receipt requested, or by reputable independent
contract delivery service furnishing a written record of attempted or actual
delivery, and shall be deemed to be delivered when tendered for delivery to the
addressee at its address set forth on the Reference Pages, or at such other
address as it has then last specified by written notice delivered in accordance
with this Article 27, or if to Tenant at either its aforesaid address or its
last known registered office or home of a general partner or individual owner,
whether or not actually accepted or received by the addressee. Any such notice
or document may also be personally delivered if a receipt is signed by and
received from, the individual, if any, named in Tenant’s Notice Address. Service
of process upon Landlord shall be served upon Landlord’s Registered Agent for
Service of Process, as designated on the Reference Pages, with a copy (which
shall not constitute notice) to Landlord at Landlord’s Address as set forth on
the Reference Pages. 

28.
TAXES PAYABLE BY TENANT. 

    28.1. In
addition to rent and other charges to be paid by Tenant under this Lease, Tenant
shall reimburse to Landlord, upon demand, any and all taxes payable by Landlord
(other than net income taxes) whether or not now customary or within the
contemplation of the parties to this Lease: (a) upon, allocable to, or measured
by or on the gross or net rent payable under this Lease, including without
limitation any gross income tax or excise tax levied by the State, any political
subdivision thereof, or the Federal Government with respect to the receipt of
such rent; (b) upon or with respect to the possession, leasing, operation,
management, maintenance, alteration, repair, use or occupancy of the Premises or
any portion thereof, including any sales, use or service tax imposed as a result
thereof; (c) upon or measured by the Tenant’s gross receipts or payroll or the
value of Tenant’s equipment, furniture, fixtures and other personal property of
Tenant or leasehold improvements, alterations or additions located in the
Premises; or (d) upon this transaction or any document to which Tenant is a
party creating or transferring any interest of Tenant in this Lease or the
Premises. In addition to the foregoing, Tenant agrees to pay, before
delinquency, any and all taxes levied or assessed against Tenant and which
become payable during the term hereof upon Tenant’s equipment, furniture,
fixtures and other personal property of Tenant located in the Premises.

28

29.
RELOCATION OF TENANT. 

    29.1.
Landlord, at its sole expense, on at least sixty (60) days prior written notice,
may require Tenant to move from the Premises to other space of comparable size
and decor in order to permit Landlord to consolidate the space leased to Tenant
with other adjoining space leased or to be leased to another tenant. In the
event of any such relocation, Landlord will pay all expenses of preparing and
decorating the new premises so that they will be substantially similar to the
Premises from which Tenant is moving, and Landlord will also pay the expense of
moving Tenant’s furniture and equipment to the relocated premises. In such event
this Lease and each and all of the terms and covenants and conditions hereof
shall remain in full force and effect and thereupon be deemed applicable to such
new space except that revised Reference Pages and a revised Exhibit A
shall become part of this Lease and shall reflect the location of the new
premises. 

30.
DEFINED TERMS AND HEADINGS. 

    30.1. The
Article headings shown in this Lease are for convenience of reference and shall
in no way define, increase, limit or describe the scope or intent of any
provision of this Lease. Any indemnification or insurance of Landlord shall
apply to and inure to the benefit of all the following “Landlord
Entities”, being
Landlord, Landlord’s investment manager, and the trustees, boards of directors,
officers, general partners, beneficiaries, stockholders, employees and agents of
each of them. Any option granted to Landlord shall also include or be
exercisable by Landlord’s trustee, beneficiary, agents and employees, as the
case may be. In any case where this Lease is signed by more than one person, the
obligations under this Lease shall be joint and several. The terms “Tenant” and
“Landlord” or any
pronoun used in place thereof shall indicate and include the masculine or
feminine, the singular or plural number, individuals, firms or corporations, and
their and each of their respective successors, executors, administrators and
permitted assigns, according to the context hereof. The term “rentable
area” shall
mean the rentable area of the Premises or the Building as calculated by the
Landlord on the basis of the plans and specifications of the Building including
a proportionate share of any common areas. Tenant hereby accepts and agrees to
be bound by the figures for the rentable square footage of the Premises and
Tenant’s Proportionate Share shown on the Reference Pages; however, Landlord may
adjust either or both figures if there is manifest error, addition or
subtraction to the Building or any business park or complex of which the
Building is a part, remeasurement or other circumstance reasonably justifying
adjustment. The term “Building” refers
to the structure in which the Premises are located and the common areas (parking
lots, sidewalks, landscaping, etc.) appurtenant thereto. If the Building is part
of a larger complex of structures, the term “Building” may
include the entire complex, where appropriate (such as shared Expenses,
Insurance Costs or Taxes) and subject to Landlord’s reasonable discretion.

31.
TENANT’S AUTHORITY. 

    31.1. If
Tenant signs as a corporation, partnership, trust or other legal entity each of
the persons executing this Lease on behalf of Tenant represents and warrants
that Tenant has been and is qualified to do business in the state in which the
Building is located, that the entity has full right and authority to enter into
this Lease, and that all persons signing on behalf of the entity were authorized
to do so by appropriate actions. Tenant agrees to deliver to Landlord,
simultaneously with the delivery of this Lease, a corporate resolution, proof of
due authorization by partners, opinion of counsel or other appropriate
documentation reasonably acceptable to Landlord evidencing the due authorization
of Tenant to enter into this Lease. 

32.
FINANCIAL STATEMENTS AND CREDIT REPORTS. 

    32.1. At
Landlord’s request, Tenant shall deliver to Landlord a copy, certified by an
officer of Tenant as being a true and correct copy, of Tenant’s most recent
audited financial statement, or, if unaudited, certified by Tenant’s chief
financial officer as being true, complete and correct in all material respects.
Tenant hereby authorizes Landlord to obtain one or more credit reports on Tenant
at any time, and shall execute such further authorizations as Landlord may
reasonably require in order to obtain a credit report. 

32.2. At
Landlord’s request, Guarantor shall deliver to Landlord a copy, certified by an
officer of Guarantor as being a true and correct copy, of Guarantor’s most
recent audited financial statement, or, if unaudited, certified by Guarantor’s
chief financial officer as being true, complete and correct in all material
respects. Guarantor hereby authorizes Landlord to obtain one or more credit
reports on Guarantor at any time, and shall execute such further authorizations
as Landlord may reasonably require in order to obtain a credit report.

33.
COMMISSIONS. 

    33.1. Each of
the parties represents and warrants to the other that it has not dealt with any
broker or finder in connection with this Lease, except as described on the
Reference Pages. Tenant hereby agrees to indemnify, defend (with counsel
reasonably acceptable to Landlord) and hold Landlord harmless from and against
any claims by a broker or finder relating to Tenant’s breach or alleged breach
of Tenant’s foregoing representation or warranty. 

34.
TIME AND APPLICABLE LAW. 

    34.1. Time is
of the essence of this Lease and all of its provisions. This Lease shall in all
respects be governed by the laws of the state in which the Building is located.

29

35.
SUCCESSORS AND ASSIGNS. 

    35.1. Subject
to the provisions of Article 9, the terms, covenants and conditions contained in
this Lease shall be binding upon and inure to the benefit of the heirs,
successors, executors, administrators and assigns of the parties to this Lease.

36.
ENTIRE AGREEMENT. 

    36.1. This
Lease, together with its exhibits, contains all agreements of the parties to
this Lease and supersedes any previous negotiations. There have been no
representations made by the Landlord or any of its representatives or
understandings made between the parties other than those set forth in this Lease
and its exhibits. This Lease may not be modified except by a written instrument
duly executed by the parties to this Lease. 

37.
EXAMINATION NOT OPTION. 

    37.1.
Submission of this Lease shall not be deemed to be a reservation of the
Premises. Landlord shall not be bound by this Lease until it has received a copy
of this Lease duly executed by Tenant and has delivered to Tenant a copy of this
Lease duly executed by Landlord, and until such delivery Landlord reserves the
right to exhibit and lease the Premises to other prospective tenants.
Notwithstanding anything contained in this Lease to the contrary, Landlord may
withhold delivery of possession of the Premises from Tenant until such time as
Tenant has paid to Landlord any security deposit required by Article 4, the
first month’s rent as set forth in Article 3 and any sum owed pursuant to this
Lease and provided to Landlord such other items required under this Lease,
including, but not limited to evidence of adequate insurance and evidence of
authority of Tenant to enter into this transaction. 

30

38.
RECORDATION. 

    38.1. Tenant
shall not record or register this Lease or a short form memorandum hereof
without the prior written consent of Landlord, and then shall pay all charges
and taxes incident such recording or registration. 

39.
PARKING. 

    39.1. Tenant
shall have the privilege to use up to three and six-tenths (3.6) unreserved,
uncovered parking spaces per one thousand (1,000) rentable square feet of the
Premises at no additional cost on a non-exclusive basis which shall be used in
common with other tenants, invitees and visitors to the Building, of which
allotment of parking spaces, Tenant shall have the privilege to contract with
the parking garage operator in the Building to use up to one and three-tenths
(1.3) unreserved, covered parking spaces per one thousand (1,000) rentable
square feet of the Premises located in the parking garage of the Building at the
prevailing market rate for such spaces, provided that Tenant contracts for such
spaces within sixty (60) days of the Commencement Date. At the discretion of the
garage operator and depending on the availability of spaces, Tenant shall lose
its privilege to contract for such spaces if Tenant shall fail to contract for
such spaces in any subsequent month. The current rate for such space is Twenty
and 00/100 Dollars ($20.00) per space per month, subject to change at any time
and from time to time. The foregoing shall not be deemed to provide Tenant with
an exclusive right to any parking spaces or any guaranty of the availability of
any particular parking spaces or any specific number of parking spaces.

    39.2. As used
in this Article 39, “Landlord” shall
be deemed to include an independent parking facility operator contracted by
Landlord to operate the Building’s parking facility, if any. Tenant acknowledges
that Landlord may at some time establish a standard license agreement (the
"Parking
License Agreement") with
respect to the use of parking spaces. Tenant, upon request of Landlord, shall
enter into such Parking License Agreements with Landlord provided that such
agreement does not materially alter the rights of Tenant hereunder with respect
to the parking spaces. No deductions or allowances shall be made for days when
Tenant or any of its employees does not utilize the parking facilities or for
Tenant utilizing less than all of the Parking Spaces. Tenant shall not assign or
sublease any of the Parking Spaces without the consent of Landlord. Furthermore,
Tenant agrees that it and its employees shall observe reasonable safety
precautions in the use of the Building’s parking facility, and shall at all
times abide by all rules and regulations promulgated by Landlord governing the
use of the Building’s parking facility. It is understood and agreed that
Landlord does not assume any responsibility for, and Tenant hereby expressly
releases and discharges Landlord and Landlord Entity from any liability, and
hereby waives any claim against Landlord and Landlord Entity, for any damage or
loss to any automobiles parked in the parking facility or to any personal
property located therein, or for any injury sustained by any person in or about
the parking facility. Landlord shall have the right to temporarily close the
Building parking facility or certain areas therein in order to perform necessary
repairs, maintenance and improvements to the Building parking facility or the
Building; provided, however, that (except in the case of emergency) Landlord
shall provide reasonable advance notice of such closure to Tenant. Tenant shall
not store any automobiles in the Building parking facility without the prior
written consent of Landlord. Except for emergency repairs, Tenant shall not
perform any work on any automobiles while located in the Building parking
facility. 

31

40.
LIMITATION OF LANDLORD’S LIABILITY. 

40.1.
Redress for any claim against Landlord under this Lease shall be limited to and
enforceable only against and to the extent of Landlord’s interest in the
Building. The obligations of Landlord under this Lease are not intended to be
and shall not be personally binding on, nor shall any resort be had to the
private properties of, any of its or its investment manager’s trustees,
directors, officers, partners, beneficiaries, members, stockholders, employees,
or agents, and in no case shall Landlord be liable to Tenant hereunder for any
lost profits, damage to business, or any form of special, indirect or
consequential damages. 

[SIGNATURES
CONTAINED ON NEXT PAGE] 

 

 

32

	
      WITNESS:
      

      By:____________________________
      

      Title:
      
	
      LANDLORD:
      

      TMT
      RESTON I & II, INC., 

      a
      Delaware corporation 

       

      By:
      RREEF MANAGEMENT COMPANY, 

      a
      Delaware corporation 

       

      By:
      Mark Arena

      Name:
      Mark Arena 

      Title:
      District Manager 

      Dated:
      11/03/04

	
      ATTEST:
      

      By:
      /s/ Craig H. Pizer 

      Name:
      Craig H. Pizer

      Title:
      Associate General Counsel

      [Corporate
      Seal] 
	
      TENANT:
      

      TALK
      AMERICA, INC., 

      a
      Pennsylvania corporation 

      By:
      Aloysius T. Lawn IV 

      Name:
      Aloysius T. Lawn IV

      Title:
      EVP - General Counsel

      Dated:10/28/04
      

 

33

 

 

 

EXHIBIT
A - FLOOR PLAN DEPICTING THE PREMISES 

 

attached
to and made a part of Lease bearing the 

Lease
Reference Date of 10/28/2004 between 

TMT
Reston I & II, Inc., as Landlord and 

Talk
America, Inc., as Tenant 

 

Exhibits
A and A-1 are intended only to show the general layout of the Premises as of the
beginning of the Term of this Lease. They do not in any way supersede any of
Landlord’s rights set forth in Article 17 with respect to arrangements and/or
locations of public parts of the Building and changes in such arrangements
and/or locations. It is not to be scaled; any measurements or distances shown
should be taken as approximate. 

 

 

 

34

 

EXHIBIT
A-1 - SITE PLAN 

 

attached
to and made a part of Lease bearing the 

Lease
Reference Date of 10/28/2004 between 

TMT
Reston I & II, Inc., as Landlord and 

Talk
America, Inc., as Tenant 

 

35

 

EXHIBIT
B 

 

attached
to and made a part of Lease bearing the 

Lease
Reference Date of 10/28/2004between 

TMT
Reston I & II, Inc., as Landlord and 

Talk
America, Inc., as Tenant 

[INTENTIONALLY
OMITTED] 

 

36

 

EXHIBIT
C - COMMENCEMENT DATE MEMORANDUM 

 

attached
to and made a part of Lease bearing the 

Lease
Reference Date of 10/28/2004 between 

TMT
Reston I & II, Inc., as Landlord and 

Talk
America, Inc., as Tenant 

 

COMMENCEMENT
DATE MEMORANDUM 

 

THIS
MEMORANDUM, made as of __________, 2004, by and between TMT Reston I & II,
Inc., a Delaware corporation, (“Landlord”) and
Talk America, Inc. (“Tenant”).

 

Recitals:

 

A.
Landlord and Tenant are parties to that certain Lease, dated for reference
_________, 2004 (the “Lease”) for
certain premises (the “Premises”)
consisting of approximately 1,136 square feet at the building commonly known as
Reston Plaza I located at 12030 Sunrise Valley Drive, Reston, VA 20191.

 

B. Tenant
is in possession of the Premises and the Term of the Lease has commenced.

 

C.
Landlord and Tenant desire to enter into this Memorandum confirming the
Commencement Date, the Termination Date and other matters under the Lease.

 

NOW,
THEREFORE, Landlord and Tenant agree as follows: 

 

1. The
actual Commencement Date is ________________. 

 

2. The
actual Termination Date is ____________________. 

 

3. The
schedule of the Annual Rent and the Monthly Installment of Rent set forth on the
Reference Pages is deleted in its entirety, and the following is substituted
therefor: 

 

[insert
rent schedule] 

 

4.
Capitalized terms not defined herein shall have the same meaning as set forth in
the Lease. 

 

 

37

IN
WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed as
of the date and year first above written. 

 

	
      WITNESS:
      

      By:____________________________
      

      Title:
      
	
      LANDLORD:
      

      TMT
      RESTON I & II, INC., 

      a
      Delaware corporation 

       

      By:
      RREEF MANAGEMENT COMPANY, 

      a
      Delaware corporation 

       

      By:
      

      Name:
      Mark Arena 

      Title:
      District Manager 

      Dated:
      

	
      ATTEST:
      

      By:_____________________________
      

      Name:
      

      Title:
      

      [Corporate
      Seal] 
	
      TENANT:
      

      TALK
      AMERICA, INC., 

      a
      Pennsylvania corporation 

      By:______________________________
      

      Name:
      

      Title:
      

      Dated:________________________
      

NOT
FOR EXECUTION 

 

 

38

EXHIBIT
D - RULES AND REGULATIONS 

 

attached
to and made a part of Lease bearing the 

Lease
Reference Date of 10/28/2004 between 

TMT
Reston I & II, Inc., as Landlord and 

Talk
America, Inc., as Tenant 

1.     No sign,
placard, picture, advertisement, name or notice shall be installed or displayed
on any part of the outside or inside of the Building without the prior written
consent of the Landlord. Landlord shall have the right to remove, at Tenant’s
expense and without notice, any sign installed or displayed in violation of this
rule. All approved signs or lettering on doors and walls shall be printed,
painted, affixed or inscribed at Tenant’s expense by a vendor designated or
approved by Landlord. In addition, Landlord reserves the right to change from
time to time the format of the signs or lettering and to require previously
approved signs or lettering to be appropriately altered. 

2.     If Landlord
objects in writing to any curtains, blinds, shades or screens attached to or
hung in or used in connection with any window or door of the Premises, Tenant
shall immediately discontinue such use. No awning shall be permitted on any part
of the Premises. Tenant shall not place anything or allow anything to be placed
against or near any glass partitions or doors or windows which may appear
unsightly, in the opinion of Landlord, from outside the Premises. 

3.     Tenant shall
not obstruct any sidewalks, halls, passages, exits, entrances, elevators, or
stairways of the Building. No tenant and no employee or invitee of any tenant
shall go upon the roof of the Building. 

4.     Any directory
of the Building, if provided, will be exclusively for the display of the name
and location of tenants only and Landlord reserves the right to exclude any
other names. Landlord reserves the right to charge for Tenant’s directory
listing. 

5.     All cleaning
and janitorial services for the Building and the Premises shall be provided
exclusively through Landlord. Tenant shall not cause any unnecessary labor by
carelessness or indifference to the good order and cleanliness of the Premises.
Landlord shall not in any way be responsible to any Tenant for any loss of
property on the Premises, however occurring, or for any damage to any Tenant’s
property by the janitor or any other employee or any other person. 

6.     The toilet
rooms, toilets, urinals, wash bowls and other apparatus shall not be used for
any purpose other than that for which they were constructed. No foreign
substance of any kind whatsoever shall be thrown into any of them, and the
expense of any breakage, stoppage or damage resulting from the violation of this
rule shall be borne by the Tenant who, or whose employees or invitees, shall
have caused it. 

 

  7.     Tenant shall store
all its trash and garbage within its Premises. Tenant shall not place in any
trash box or receptacle any material which cannot be disposed of in  
the  ordinary and
customary manner of trash and garbage disposal. All garbage and refuse disposal
shall be made in accordance with directions issued from time to time by
Landlord. Tenant will comply with any and all recycling procedures designated by
Landlord. 

39

  8.     Landlord will furnish
Tenant two (2) keys free of charge to each door in the Premises that has a
passage way lock. Landlord may charge Tenant a reasonable amount for any
additional keys, and Tenant shall not make or have made additional keys on its
own. Tenant shall not alter any lock or install a new or additional lock or bolt
on any door of its Premises. Tenant, upon the termination of its tenancy, shall
deliver to Landlord the keys of all doors which have been furnished to Tenant,
and in the event of loss of any keys so furnished, shall pay Landlord therefor.

9.     If Tenant
requires telephone, data, burglar alarm or similar service, the cost of
purchasing, installing and maintaining such service shall be borne solely by
Tenant. No boring or cutting for wires will be allowed without the prior written
consent of Landlord. 

10.     No equipment,
materials, furniture, packages, bulk supplies, merchandise or other property
will be received in the Building or carried in the elevators except between such
hours and in such elevators as may be designated by Landlord. The persons
employed to move such equipment or materials in or out of the Building must be
acceptable to Landlord. 

11.     Tenant shall
not place a load upon any floor which exceeds the load per square foot which
such floor was designed to carry and which is allowed by law. Heavy objects
shall stand on such platforms as determined by Landlord to be necessary to
properly distribute the weight. Business machines and mechanical equipment
belonging to Tenant which cause noise or vibration that may be transmitted to
the structure of the Building or to any space in the Building to such a degree
as to be objectionable to Landlord or to any tenants shall be placed and
maintained by Tenant, at Tenant’s expense, on vibration eliminators or other
devices sufficient to eliminate the noise or vibration. Landlord will not be
responsible for loss of or damage to any such equipment or other property from
any cause, and all damage done to the Building by maintaining or moving such
equipment or other property shall be repaired at the expense of Tenant.

12.     Landlord
shall in all cases retain the right to control and prevent access to the
Building of all persons whose presence in the judgment of Landlord would be
prejudicial to the safety, character, reputation or interests of the Building
and its tenants, provided that nothing contained in this rule shall be construed
to prevent such access to persons with whom any tenant normally deals in the
ordinary course of its business, unless such persons are engaged in illegal
activities. Landlord reserves the right to exclude from the Building between the
hours of 6 p.m. and 7 a.m. the following day, or such other hours as may be
established from time to time by Landlord, and on Sundays and legal holidays,
any person unless that person is known to the person or employee in charge of
the Building and has a pass or is properly identified. Tenant shall be
responsible for all persons for whom it requests passes and shall be liable to
Landlord for all acts of such persons. Landlord shall not be liable for damages
for any error with regard to the admission to or exclusion from the Building of
any person. 

13.     Tenant shall
not use any method of heating or air conditioning other than that supplied or
approved in writing by Landlord. 

14.     Tenant shall
not waste electricity, water or air conditioning. Tenant shall keep corridor
doors closed. Tenant shall close and lock the doors of its Premises and entirely
shut off all water faucets or other water apparatus and electricity, gas or air
outlets before Tenant and its employees leave the Premises. Tenant shall be
responsible for any damage or injuries sustained by other tenants or occupants
of the Building or by Landlord for noncompliance with this rule. 

40

15.     Tenant shall
not install any radio or television antenna, satellite dish, loudspeaker or
other device on the roof or exterior walls of the Building without Landlord’s
prior written consent, which consent may be withheld in Landlord’s sole
discretion, and which consent may in any event be conditioned upon Tenant’s
execution of Landlord’s standard form of license agreement. Tenant shall be
responsible for any interference caused by such installation. 

16.     Tenant shall
not mark, drive nails, screw or drill into the partitions, woodwork, plaster, or
drywall (except for pictures, tackboards and similar office uses) or in any way
deface the Premises. Tenant shall not cut or bore holes for wires. Tenant shall
not affix any floor covering to the floor of the Premises in any manner except
as approved by Landlord. Tenant shall repair any damage resulting from
noncompliance with this rule. 

17.     Tenant shall
not install, maintain or operate upon the Premises any vending machine without
Landlord’s prior written consent, except that Tenant may install food and drink
vending machines solely for the convenience of its employees. 

18.     No cooking
shall be done or permitted by any tenant on the Premises, except that
Underwriters’ Laboratory approved microwave ovens or equipment for brewing
coffee, tea, hot chocolate and similar beverages shall be permitted provided
that such equipment and use is in accordance with all applicable federal, state
and city laws, codes, ordinances, rules and regulations. 

19.     Tenant shall
not use in any space or in the public halls of the Building any hand trucks
except those equipped with the rubber tires and side guards or such other
material-handling equipment as Landlord may approve. Tenant shall not bring any
other vehicles of any kind into the Building. 

20.     Tenant shall
not permit any motor vehicles to be washed or mechanical work or maintenance of
motor vehicles to be performed in any parking lot. 

41

21.     Tenant shall
not use the name of the Building or any photograph or likeness of the Building
in connection with or in promoting or advertising Tenant’s business, except that
Tenant may include the Building name in Tenant’s address. Landlord shall have
the right, exercisable without notice and without liability to any tenant, to
change the name and address of the Building. 

22.     Tenant
requests for services must be submitted to the Building office by an authorized
individual. Employees of Landlord shall not perform any work or do anything
outside of their regular duties unless under special instruction from Landlord,
and no employee of Landlord will admit any person (Tenant or otherwise) to any
office without specific instructions from Landlord. 

23.     Tenant shall
not permit smoking or carrying of lighted cigarettes or cigars other than in
areas designated by Landlord as smoking areas. 

 

24.      Canvassing, soliciting, distribution of
handbills or any other written material in the Building is prohibited and each
tenant shall cooperate to prevent the same. No tenant shall solicit business
from other tenants or permit the sale of any good or merchandise in the Building
without the written consent of Landlord. 

25.    Tenant shall
not permit any animals other than service animals, e.g. seeing-eye dogs, to be
brought or kept in or about the Premises or any common area of the Building.

26.     These Rules
and Regulations are in addition to, and shall not be construed to in any way
modify or amend, in whole or in part, the terms, covenants, agreements and
conditions of any lease of any premises in the Building. Landlord may waive any
one or more of these Rules and Regulations for the benefit of any particular
tenant or tenants, but no such waiver by Landlord shall be construed as a waiver
of such Rules and Regulations in favor of any other tenant or tenants, nor
prevent Landlord from thereafter enforcing any such Rules and Regulations
against any or all of the tenants of the Building. 

27.     Landlord
reserves the right to make such other and reasonable rules and regulations as in
its judgment may from time to time be needed for safety and security, for care
and cleanliness of the Building, and for the preservation of good order in and
about the Building. Tenant agrees to abide by all such rules and regulations
herein stated and any additional rules and regulations which are adopted. Tenant
shall be responsible for the observance of all of the foregoing rules by
Tenant’s employees, agents, clients, customers, invitees and guests.

42

 

EXHIBIT
E - FORM OF GUARANTY 

 

                        attached to and made
a part of Lease bearing the 

Lease
Reference Date of 10/28/2004 between 

TMT
Reston I & II, Inc., as Landlord and 

Talk
America, Inc., as Tenant 

 

CONTINUING
GUARANTY OF LEASE 

 

 

THIS
CONTINUING GUARANTY OF LEASE (the
“Guaranty”) is made
and executed this __ day of ___________, 2004 from (i) TALK
AMERICA HOLDINGS, INC., a
Delaware corporation (hereinafter referred to as “Guarantor”) to
(ii) TMT
RESTON I & II, INC., a
Delaware corporation, its successor and assigns (hereinafter referred to as
“Landlord”).

 

 

W
I T N E S S E T H : 

 

WHEREAS,
Landlord has entered into that certain Lease Agreement with a Lease Reference
date of ______________________, 2004, (the “Lease”),
whereby Landlord has agreed to lease to Talk America, Inc., a Pennsylvania
corporation (hereinafter referred to as “Tenant”)
certain premises (hereinafter referred to as the “Premises”)
comprising approximately 1,136 rentable square feet of the office building
commonly known as Reston Plaza I and located at 12030 Sunrise Valley Drive,
Reston, Virginia, as described in the Lease; and 

 

WHEREAS, Tenant
is wholly owned by Guarantor; and 

 

WHEREAS, by
reason of the foregoing relationship, it is in Guarantor’s direct interest and
advantage to assist Tenant in securing Landlord’s agreement to execute the
Lease; and 

 

WHEREAS,
Landlord is willing to execute and deliver the Lease to Tenant only if Guarantor
guarantees to Landlord the prompt performance by Tenant of all the covenants,
terms, conditions and obligations to be performed by Tenant under the Lease.

 

NOW,
THEREFORE, in
consideration of the foregoing, and for the purposes of inducing Landlord to
execute the Lease, Guarantor agrees as follows: 

 

1.     Guarantor
warrants and represents to Landlord that: (a) the making and performance of this
Guaranty by Guarantor will not result in the breach of any term, condition or
provision of, or constitute a default under, any contract, agreement or other
instrument to which Guarantor is a party or by which Guarantor may be bound, or
result in a breach of any regulation, order, writ, injunction or decree of any
court or any commission, board or other administrative agency entered in any
proceeding to which Guarantor is a party or by which it may be bound; (b)
Guarantor’s representation contained in the Recitals set forth hereinabove (all
of which are incorporated herein by this reference and made a part hereof) are
true, accurate and complete; and (c) under penalty of perjury, the written
financial statements and other written information presented to Landlord by
Guarantor in connection with the Lease are true, accurate and complete, and do
not omit any material fact or amount necessary to avoid making such statements
and information misleading. 

43

2.     Guarantor
hereby absolutely, unconditionally, irrevocably, jointly and severally,
guarantees to Landlord (i) the prompt and complete payment by Tenant to Landlord
of the fixed minimum rental payable by Tenant to Landlord under the Lease, (ii)
the prompt and complete payment by Tenant to Landlord of all other sums of money
payable by Tenant to Landlord under the Lease, (iii) the prompt and complete
performance by Tenant of all covenants, conditions, terms and obligations to be
performed by Tenant under the Lease, and (iv) the prompt and complete payment by
Tenant to Landlord of all damages, costs and expenses that, by reason of the
Lease, may become payable by Tenant to Landlord. Guarantor hereby agrees to
fully defend upon request (with counsel approved by Landlord), indemnify, and
hold Landlord harmless from any cost, claim, liability, damage or expense
(including, but not limited to attorneys’ fees and expenses and court costs)
which Landlord incurs in the event Tenant, as tenant, does not punctually pay,
perform, or fulfill all of its obligations under the Lease. 

3.     At Landlord’s
request, Guarantor shall deliver to Landlord a copy, certified by an officer of
Guarantor as being a true and correct copy, of Guarantor’s most recent audited
financial statement, or, if unaudited, certified by Guarantor’s chief financial
officer as being true, complete and correct in all material respects. Guarantor
hereby authorizes Landlord to obtain one or more credit reports on Guarantor at
any time, and shall execute such further authorizations as Landlord may
reasonably require in order to obtain a credit report. 

4.     Guarantor’s
liability hereunder shall in no way be affected by any indulgence, extension, or
forbearance which Landlord may grant to Tenant with respect to the payment or
performance of any obligation of Tenant, or any waiver, on the part of Landlord
of any breach of the Lease by Tenant; and Guarantor waives any requirement that
Guarantor be notified of any such indulgence, extension, forbearance or waiver,
and Guarantor waives notice of such matters and of any default by Tenant under
the Lease. 

5.     In the event
of the default by Tenant in the performance of any of its covenants or
obligations under the Lease, Guarantor covenants and agrees to perform such
obligations forthwith upon demand (in the same manner as if the same constituted
the direct primary obligation and liability of Guarantor), including, without
limitation, payments of all sums owing to Landlord by reason of such default.

6.     Landlord
shall have the right, at any time and from time to time, to enforce all rights
and remedies available to Landlord under the Lease, including, without
limitation, agreements with Tenant modifying or changing any of the terms of
provisions of the Lease, extending or renewing the time of payment of any such
payable under the Lease, compromising or making settlement of any obligation of
Tenant under the Lease, terminating the Lease or resuming possession of the
Premises, making demand upon or instituting legal proceedings against Tenant,
granting any indulgence, extension or forbearance to Tenant with respect to the
performance of any obligation of Tenant, or waiving any breach of the Lease by
Tenant, all without notice to, or consent of, Guarantor and without affecting
the continuing validity and enforceability of this Guaranty. 

44

7.     Provided
Landlord gives Tenant proper notice as may be set forth in the Lease, Landlord
may make demand and/or institute legal proceedings against Guarantor for the
performance of any obligation of Tenant under the Lease without first proceeding
in any way against Tenant and without enforcing any rights or remedies under the
Lease. 

8.     No reasonable
delay of the Landlord in exercising any rights and/or powers hereunder or in
taking any action to enforce the performance of Tenant’s obligations under the
Lease shall operate as a waiver as to such rights or powers or in any manner
prejudice any or all of Landlord’s rights and powers hereunder against
Guarantor. 

9.     All claims
which Guarantor may have against Tenant by reason of this Guaranty, whether by
way of subrogation to any position of Landlord or for contribution or
reimbursement, shall be subordinate to any outstanding claims which Landlord
then has against Tenant. Guarantor hereby releases Landlord from all liability
to Guarantor or Tenant for failing to recognize or observe or protect any legal
or equitable rights of Guarantor with respect to Tenant or the Premises or the
Lease. 

10.     This Guaranty
may not be modified, altered or terminated except pursuant to an instrument in
writing executed by Guarantor and Landlord. No waiver of any provision of this
Guaranty shall be valid unless in writing and signed by Landlord. A failure of
Landlord to insist upon strict performance of any obligation or covenant of
Guarantor under this Guaranty in any one or more instances shall not be
construed as a waiver or relinquishment of the right to insist upon strict
performance of such obligation or covenant in the future. 

11.     This Guaranty
shall be construed and enforced in accordance with the laws of the Commonwealth
of Virginia. Guarantor hereby waives notice of nonpayment, nonperformance, or
nonobservance or any notice of acceptance of this Guaranty and any other notice
to or demand upon Guarantor which Landlord might otherwise be required to give
or make in connection with any matter relating to this Guaranty. Guarantor
waives any legal obligation, duty or necessity for Landlord to proceed first
against Tenant, as tenant, or to exhaust any remedy Landlord may have against
Tenant, as tenant, it being agreed that in the event of a default or failure in
performance in any respect by Tenant, as tenant under the Lease, Landlord may
proceed and have the right of action solely against Guarantor and/or any other
guarantor of the Lease or Tenant, as tenant or jointly against Guarantor and/or
any other guarantor of the Lease and Tenant, as tenant. Furthermore, to the
extent applicable, Guarantor hereby waives the benefit of Sections 49-25 and
49-26 of the Code of Virginia (2001) as amended. Guarantor hereby expressly,
knowingly and irrevocably consents and waives any objection to the jurisdiction
of any state or federal court situated within the Commonwealth of Virginia over
any suit, action or proceeding whether for damages or for injunction, specific
performance or for any other prohibitory or mandatory relief arising out of or
relating to this Lease. Guarantor hereby expressly, knowingly and irrevocably
agrees that all claims in respect of such suit, action or proceeding may be
heard and determined in such state or federal court situated within the
Commonwealth of Virginia. Having received the advice of competent legal counsel,
Guarantor hereby expressly, knowingly, and irrevocably waives, to the fullest
extent it may effectively do so, objection to defending any such suit, action or
proceedings in such state or federal court, based on the defense of forum
non conveniens (inconvenient
forum) for the maintenance of such suit, action or proceeding. Guarantor
appoints hereby Aloysius
T. Lawn as agent
for the purpose of accepting service of process (“Guarantor’s
Agent”).
Should Guarantor’s Agent be unavailable, disabled, or otherwise unable or
unwilling to accept service of process, Guarantor appoints the Clerk of the
Virginia State Corporation Commission, or such other official provided for under
the laws of the Commonwealth of Virginia, as agent for the service of process.
Guarantor hereby expressly, knowingly, and irrevocably consents to service of
all writs, processes and summons in any such suit, action or proceeding by
mailing thereof to either (a) Guarantor at Guarantor’s Notice Address (defined
herein) or (b) Guarantor’s Agent’s Notice Address (or the Secretary of the
Commonwealth), by United States certified mail, postage prepaid, return receipt
requested or by Federal Express overnight delivery, courier charges prepaid,
signature of recipient required. Guarantor also hereby expressly, knowingly and
irrevocably consents and waives any objection to the enforcement by execution
against property or otherwise of any relief ordered in such suit, action or
proceeding in any federal or state court of the United States or any court of
any foreign state. The consent and waiver under this paragraph shall not limit
the rights of Landlord to bring any suit, action or proceeding against Guarantor
in any other jurisdiction for such relief, or of any party to serve process in
any other manner permitted by law, or to obtain execution of judgment in any
jurisdiction. 

45

12.     All notices
required or desired to be given by either party to the other under this Guaranty
shall be in writing and shall be personally delivered or sent by nationally
available overnight courier or by certified mail, return receipt requested,
postage prepaid, and shall be effective upon actual receipt as verified by
written acknowledgement of delivery (or upon the date such delivery is refused)
in the case of personal or overnight delivery and by the return receipt (or upon
the date such delivery is refused) in the case of certified mail. A party shall
designate a change of address or agent by notice to the other party at least ten
(10) days before such change is to become effective. All notices to the
respective parties shall be addressed and sent as follows (the “Notice
Address”):

Landlord:
TMT Reston I & II, Inc. 

c/o RREEF

8280
Greensboro Drive 

Suite 550

McLean,
Virginia 22102 

Attn:
Patrick N. Connell, Vice President 

with a
copy, said copy not constituting notice, to: 

Covington
& Burling 

1201
Pennsylvania Avenue, N.W. 

Washington,
D.C. 20004 

 

Attn:
Robert J. Gage, Esq. 

 

Guarantor:
Talk America Holdings, Inc. 

6805
Route 202 

New Hope,
PA 18938 

Attn:
Bill McGrath, Senior VP 

 

with a
copy, said copy also constituting notice, to Guarantor’s Agent : 

 

Aloysius
T. Lawn, General Counsel 

Talk
America Holdings, Inc. 

6805
Route 202 

New Hope,
PA 18938 

13.     This Guaranty
shall be binding upon Guarantor, its successor or assigns, and shall inure to
the benefit of, and be enforceable by Landlord, its successors or assigns, and
by any successor to the interest of landlord under the Lease. 

46

14.     Guarantor
shall pay to Landlord all costs, including without limitation attorneys’ fees
and expenses, court costs, expert witness fees, and other disbursements and
costs of collection, incurred by Landlord in connection with enforcing any
provision of this Guaranty, whether or not any action or lawsuit is actually
instituted by Landlord. 

15.     This Guaranty
is absolute and is not conditioned in any way upon the genuineness, validity,
regularity or enforceability of the Lease, provided that the Lease was signed by
Tenant. 

16.     Guarantor’s
obligations under this Guaranty shall be unaffected by any discharge or release
of the Tenant, its successors or assigns, or any of their debts, in connection
with any bankruptcy, reorganization, or other insolvency proceeding or
assignment for the benefit of creditors; any rejection or disaffirmation of the
Lease in any bankruptcy, reorganization, or other insolvency proceeding or
assignment for the benefit of creditors; or any reduction, modification,
impairment or limitation of the liability of the Tenant, its successors or
assigns, or of Landlord’s remedies under the Lease, in connection with any
bankruptcy, reorganization or other insolvency proceeding or any assignment for
the benefit of creditors. In addition, if Landlord is required to disgorge or
pay back to the Tenant’s estate any payments made by the Tenant under the Lease
in connection with any bankruptcy, reorganization or insolvency proceeding,
Guarantor’s obligations as to such payments shall be reinstated. 

17.     In the event
that any covenant, condition or other provision herein contained is held to be
invalid, void or illegal by any court of competent jurisdiction, the same shall
be deemed severable from the remainder of this agreement and shall in no way
affect, impair or invalidate any other covenant, condition or other provision
herein contained. 

 

[SIGNATURES
ON NEXT PAGE]

 

 

47

IN
WITNESS WHEREOF, the
undersigned have executed this Guaranty on the day and year first above written

 

	
      ATTEST:
      

      By:
      _________________________________ 

      Name:
      ______________________________ 

      Title:
      _______________________________ 

      Date:
      _______________________________ 
	
      GUARANTOR:
      

      Talk
      America Holdings, Inc., 

      a
      Delaware corporation 

      By:
      _______________________________ 

      Name:
      ____________________________ 

      Title:
      ______________________________ 

      Date:
      ______________________________ 

[corporate
seal] 

CITY ) )
ss:
STATE ) 

 

 

BEFORE
ME, a Notary
Public in and for the jurisdiction aforesaid, personally appeared this date
_______________________________, personally well known (or satisfactorily
proven) to me to be the person whose name is subscribed to the foregoing and
annexed Guaranty bearing date as of ________________ ___, 2004, who, being by me
first duly sworn, did depose and state that he/she is the
_______________________________ of Talk
America Holdings, Inc., a
Delaware corporation, which entity is a party of the foregoing and annexed
Guaranty, and that he/she, being duly authorized so to do, executed said
Guaranty on behalf of said entity and acknowledge the same as its free act and
deed for the uses and purposes herein contained. 

 

 

SUBSCRIBED
AND SWORN TO before me
this ___ day of _____________, 2004. 

 

[notary
seal] _____________________________________ 

Notary
Public 

My
Commission expires: 

NOT
FOR EXECUTION

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