HomeMy WebLinkAbout09-0500a ?
IN THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY,
PENNSYLVANIA
ZUR, LTD.,
2020 State Road 9 ?v Q Cy,),
Camp Hill, Pennsylvania 17011
Plaintiff
V.
ALPHA OMEGA UNLIMITED, LLC Equity- Declaratory Judgment
40 Tannery Road
Dillsburg, Pennsylvania 17019
Defendant
ACTION FOR DECLARATORY JUDGMENT
AND NOW, comes Plaintiff, Zur Ltd, by and through its duly appointed
attorneys, CGA Law Firm, files the within Action for Declaratory Judgment and in
support thereof, avers as follows:
1. Zur Ltd., (hereinafter "Plaintiff") is a limited liability corporation
organized and existing under the laws of the Commonwealth of Pennsylvania, having its
principal office address at 2020 State Road, Camp Hill, PA 17011.
2. Defendant, Alpha Omega Unlimited, LLC (hereinafter "Defendant"), is a
limited liability corporation and existing under the laws of the Commonwealth of
Pennsylvania, having its principal office address at 40 Tannery Road, Dillsburg,
Pennsylvania, 17019.
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COUNT I DECLARATORY JUDGMENT
3. The venue before this Court is proper pursuant to stipulation by the
parties.
4. On or about February 10, 2006, Plaintiff entered into a commercial lease
agreement with Defendant to lease warehouse space in a building located at 3825
Hartzdale Drive, Camp Hill, PA 17011, for a term of ten years. A true and correct copy
of said lease agreement is marked and attached hereto as Exhibit "A".
5. On or about February 10, 2006, Plaintiff entered into a commercial lease
agreement with Defendant to lease office space in a building located at 3825 Hartzdale
Drive, Camp Hill, PA 17011, for a term of three years. A true and correct copy of said
lease agreement is marked and attached hereto as Exhibit "B".
6. Plaintiff s total leased space, or pro-rata share, is 79.5% of the entire
building at Hatrzdale Drive (69%- warehouse, 10.5%- office space).
7. Paragraph 5(b) of both lease agreements (the "Leases") provides that
"Tenant shall pay as Additional Rent its pro-rata share of the cost of operating, replacing
improving, maintaining, repairing, and refurbishing the Common Areas ("Common Area
Charge"), which for the purposes of this Section only, shall include all roofs of the
Building."
8. The term "Common Areas" is defined in paragraph 2 of the Leases as
"...such parking areas, service roads, sidewalks, signs, equipment facilities, service areas,
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to
hallways, doors, stairwells, and the like (the "Common Areas") as Landlord may from
time to time, make available to Tenant for use in common with others..."
9. So defined, the Common Areas occupy no more than 4% of the building
10. Paragraph 10) of the Leases provide that Plaintiff's pro-rata allocation of
the Common Area Charge is equal to Plaintiff's total leased space (69%- warehouse,
10.5%- office space).
11. Therefore the Common Area Charge attributed to Plaintiff is equal to
79.5% of the approximately 4% of the premises that are included as Common Area-or
about 3.2% of the expense to be allocated to Common Areas,
12. Paragraph 5(b) of the Leases identifies examples of includable costs in the
Common Area Charge for the Common Areas, including the materials, supplies
equipment, and services purchased or hired, as well as the heating, ventilation, and air-
conditioning of the enclosed areas of the premises other than the leased premises.
13. Paragraph 5(c) of the Leases establishes a Capital Improvement Fund, as it
acknowledges that Common Area Charge in 5(b) include the costs of repairs to the roof
and/or installation of a new room, resurfacing of parking lots, along with repairs and/or
replacement of the air conditioning unit(s) and heating system; and that such costs
may result in a substantial Common Area Charge. (emphasis ours)
14. The Capital Improvement Fund ("CIF") is funded by tenant contributions,
based on their pro-rata share of space in the Building and, for Plaintiff, set forth in
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paragraph 1(k) of the Leases, equaling an aggregate annual contribution of $7,950.00,
paid monthly as Additional Rent.
15. Plaintiff has paid all Minimum Rent payments and Additional Rent
Payments, including those attributed to Common Area Charges, taxes, insurance, utilities
and CIF on time through October 2008.
16. Under the language quoted above, Plaintiff is responsible to pay 79.5% of
the cost of heating, cooling and ventilating the Common Areas, which cost may include
repairs, maintenance, or replacement ("HVAC Costs"). Accordingly, after 4% of the
total HVAC Costs are allocated to cover the cost of heating, cooling and ventilating the
Common Areas, Plaintiff is obligated to pay 79.5% of that 4% allocation.
17. In accordance with paragraph 5(c) of the Leases, Tenant is not liabile to
pay any HVAC Costs„ unless and until Landlord has exhausted the CIF Fund..
18. Upon reviewing Defendant's Common Area Charge accounting
statements for 2006 and 2007, Plaintiff discovered that Defendant was not paying the
HVAC Costs from the CIF.
19. Instead of deducting the costs of HVAC repair from the CIF Fund as
required by 5 (c), Landlord directly charged Plaintiff 79,5% of all HVAC repairs as
Common Area Charges. So far as Plaintiff can determine the CIF Funds were not only
not disposed of as required by the Leases, they were not used at all for HVAC repairs
20. Apart from violating the express provisions of 5 (c), Defendant charged
Plaintiff 79.5% of all HVAC Costs, as Common Area Charges, even though the Common
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Areas, are less than 4% of the building space and the pro rata allocation of HVAC
Costs.toCommon Areas is therefore 4% of the total for the building.
21. Each month, the Defendant has divided the building's HVAC costs
according to each tenant's pro-rata share of the building and charged that amount as part
of the Common Area Charge, instead of determining what part of the HVAC Costs are
attributed to Common Areas of the building and charging each tenant it's pro-rata share
of that amount as Common Area Charge.
22. Because Defendant calculated HVAC Costs based on the Plaintiff's 79%
portion of the entire building, the charges include areas of the leased premises, which are
specifically excluded under paragraph 5(b). Further, Defendant failed to debit the CIF,
the account specifically established to cover such expenses, for the HVAC Costs.
23. In short, Defendant has required the Plaintiff each month to pay twice for
heating air conditioning and ventilating repairs once as part of the Common Area
Charge, and again as Plaintiffs contribution to the CIF.
24. Upon review of the Common Area Charge accounting statement, Plaintiff
also discovered that Defendant was improperly including costs of building improvements
for the benefit of the landlord, and a gas utility deposit related to natural gas utility
service turn-on for the entire building as Common Area Charge expenses.
25. Said expenses were made for the benefit of the Defendant as landlord of
the building, and not attributed to the Common Areas of the building as defined in
paragraph 2 of the Leases.
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26. Said charges are not valid Common Area Charges under Paragraph 5(b) of
the Leases.
27. Defendant's increase to Plaintiff's Common Area Charges in 2006, 2007
and 2008 was based on the aforementioned improper Common Area Charges for prior
years.
28. Plaintiff made Additional Rent payments based on those improperly
included Common Area Charges.
29. Plaintiff is entitled to be credited for the overpayment of Common Area
Charges, paid as Additional Rent, it made to Defendant in 2006, 2007, and 2008.
30. When Plaintiff notified Defendant it was not calculating and allocating
expenses and Common Area Charges correctly, instead of correcting its mistake,
Defendant continued to overcharge Plaintiff for Additional Rent.
31. Further, when notified of its improper calculations and allocations,
Defendant attempted to force Plaintiff into paying twice for HVAC Costs sending a lease
default notice to Plaintiff and tacitly threatening to evict Plaintiff unless it acquiesced in
and agreed to pay the double-billed costs.
32. Because Defendant refused to acknowledge and rectify the improper
Common Area Charges, in November 2008 Plaintiff began to escrow a portion of the
Additional Rent attributed to Common Area Charges in the amount of $3,535.46 with
CGA Law Firm.
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33. The escrowed $3,535.46 is the difference between what Defendant is
currently charging Plaintiff as Common Area Charges, and what the Plaintiff actually
owes as Additional Rent according to the provisions of the leases.
34. Plaintiff unsuccessfully attempted to work out an agreement with
Defendant regarding the allocation and applicability of the erroneous Common Area
Charges in dispute.
35. Defendant sent lease default notices to Plaintiff for the office and
warehouse leases by correspondence on or about December 31, 2008.
36. Among the lease defaults cited, Defendant included defaults for Plaintiff's
failure to pay Common Area Charges as Additional Rent in the amount totaling
$3,535.46 per month, the very amount of Additional Rent in dispute, which has been
escrowed with CGA Law Firm.
37. All of Plaintiff's alleged defaults under the Leases have been
cured/resolved with the exception of the instant Additional Rent dispute. ,
38. Plaintiff requests relief under the Pennsylvania Declaratory Judgment Act,
42 Pa.C.S. §7531, et seg; by seeking a proper calculation of Common Area Charges in
accordance with the office and warehouse lease agreements between the parties.
39. An actual controversy of a judicial nature or the seeds of one ripening
exists between the parties as it pertains to Plaintiff's alleged defaults under the Leases for
its alleged failure to pay Additional Rent expenses.
40. Plaintiff, as tenant of the leased premises, desires to maintain its
{00280564111 7
warehouse lease agreement and without risking default under the agreement, but cannot
do so until the proper Common Area Charges calculation is determined with regard to the
office and warehouse leases.
41. Plaintiff has a definite and substantial interest in seeking a determination
of the lease agreements' Common Area Charges and CIF provisions so as not to default
on the lease and risk Defendant seeking remedies under the lease agreements.
42. Plaintiff has a definite and substantial interest in seeking a determination
of the Leases' Common Area Charges provisions so as to receive credit for its
overpayment of Additional Rent.
43. Plaintiff has a definite and substantial interest in seeking a determination
of the status of the CIF balance, which funds are held by Defendant as a fiduciary.
WHEREFORE, Plaintiff, Zur, Ltd. respectfully requests that this Honorable
Court issue an Order declaring:
i) Defendant shall base its calculation of Common Area Charges on
expenses related solely to the Common Areas of the building,
under Paragraph 2 and 5(b) of the office and warehouse lease
agreements.
Defendant's calculation of Common Area Charges shall not be
based on the Plaintiff s pro-rata percentage of HVAC costs for the
entire building, but instead for the Plaintiff's pro-rata percentage of
HVAC costs for the Common Areas of the building.
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iii) Defendant's allocation of Common Area Charges for HVAC Costs
shall be expenses paid from the Capital Improvement Fund
established in paragraph 5(c) of the Leases and funded by
Additional Rent paid by tenants.
iv) Defendant's calculation of Common Area Charges shall exclude
charges that are incurred solely for the benefit of Defendant as
landlord.
V) All of Plaintiff's previous CAM Additional Rent overpayments
from 2006, 2007, and 2008, including a reasonable amount of
interest, shall be credited to Plaintiff's future Minimum Rent and
Additional Rent expenses under its warehouse lease.
Respectfully Submitted,
CGA LAW FI
Rees Griffiths
Marisa G. Button
PA 206767
135 North George Street
York, PA 17401
717-848-4900
717-843-4903 fax
Attorneys for Zur, Ltd.
(00280564/1) 9
VERIFICATION
I hereby affirm that the following facts are correct. The attached Action for
Declaratory Judgment is based upon information, which has been furnished to counsel in
the preparation of this document. The language of the attached Action for Declaratory
Judgment is that of counsel and not mine. I have read the attached Action for
Declaratory Judgment and to the extent that the same is based upon information, which I
have given to counsel, it is true and correct to the best of my knowledge, information and
belief. To the extent that the content of the attached Action for Declaratory Judgment is
that of counsel, I have relied upon counsel in making this Verification. I hereby
acknowledge that the averments of fact set forth in the aforesaid attached Action for
Declaratory Judgment are made subject to the penalties of 18 Pa. C.S. 4904 relating to
unsworn falsification to authorities.
Date: 91 D By:
Ke
Date: 1 C ?? ?G By:
Doug Waardenburg
(00280564/1) 10
EXHIBIT
A
SCANNED
LEASE AGREEMENT for Space at 3825 Hartzdale Drive, Camp Hill, PA 17011
THIS LEASE AGREEMENT ("Lease") is made this & day of February, 2006, between
Landlord: Alpha Omega Unlimited, LLC with contact address as 49 Tannery Road, Dillsburg, PA 17019
Tenant: Zur LTD, with contact address as 2230 Canterbury Drive, Mechanicsburg, PA, 17055.
WITNF$IRFTH;
1. Oefinitions. The following definitions shall apply to the indicated terms, whenever used in
this Lease. Additional defined terms may be found in the body of the Lease.
(a) Landlord: Alpha (1mWa U"jmilAd I I
cJSiarian and VMki Fichtnar
49 Tanna_T d
rills , PA 17n19
(b) Tenant: 71 IRT, , I Tr)
2230 Canterbury Drive
Mechanicsburg, PA 17055
(c) Leased Premises: Approx 38 775 square feet
(d) Permitted Use: Warehouse
(e) Lease Commencement Date: 31112006
All prorate CAM, Taxes and Insurance charges are due beginning on the lease commencement date.
(f) Rent Commencement Date: 211012006
(g) Term: In years 0 months
(h) Minimum Rent: $10,000 per month with no increase for the term of the lease.
(i) Renewal Options: 5 Year Option to renew at $15,000 per month.
See Option Rider, 9 applicable. All Renewal Periods shall be included in the definition of the Term.
(j) Percentage of Common Area Charge ("CAM"): 69%
Initial Annual Amount: ($12,000.00) $8280/year
(k) Percentage of Capital Improvements Fund 69%
Initial Annual Amount: ) $86$86""a
e /
01/>1 psr. c117)? S? 901,yea,..
(1) Security Deposit:
(m) Insurance Payment ("Ins."): 69%
Initial Annual Amount ($5,000.00) $3450/year
(n) Tax Payment ('Tax"): 69%
Initial Annual Amount: ($40,000.00) $27,600/year
(?) ut;l/fiesas (s its/?i1??,r f A?i?t?'?, ;c 7 6 9 a
?/nl Notices: To Landlord: Alpha Omega
A 5
,7 Camp Hill, PA 17011
With a copy to. Attorney Mark Thomas
1n1 .Rmirh kAarkef Pfraal
,
With a copy to: Ralph H. Wright, Jr.
Johnson, Duffle, Stewart &
Weidner
P.O. Box 109
Lemoyne, PA 17043-0109
(p) Attachments: Exhibit A - Floor Plan
Exhibit B - Signage Criteria
Exhibit C - Rules and Regulations
Exhibit D - Delivery of Documents
Exhibit E - Build Out Rider
Exhibit F - Guaranty
PrArrdSeS.
Descdpfion of Premises Landlord leases to Tenant, and Tenant leases from Landlord, the
Leased Premises described in Section 1. The Leased Premises is outlined. in red on a diagram of the
Building attached hereto and incorporated herein as Exhibit "A." Exhibit "A" sets forth the general layout of
the Building and shall not be deemed a warranty on the part of Landlord Mat the Building is or will be exactly
as Indicated on such diagram. Landlord may increase, reduce, or change the number, dimensions, and
locations of roadways, walks, buildings, and parking areas as Landlord from time to time deems proper.
Tenants occupancy of the Leased Premises shall include the use in common with others entitled thereto of
such parking areas, service roads, sidewalks, signs, equipment facilities, service areas, hallways, doors,
stairwells, and the like (the "Common Areas") as Landlord may from time to time, make available to Tenant
for use in common with others, subject, however, to the terms and conditions of this Lease and to all rules
and regulations for the use thereof as may from time to time be prescribed by Landlord.
3. ug, of I eased Premises- Nana. The Leased Premises shall be used solely for the
Permitted Use Indicated in Section 1, and for no other purpose. Tenant shall operate such a business in the
Leased Premises at all times during the Term. Tenant shall conduct its business in the Leased Premises
under its Legal name of the Trade Name indicated in Section 1. Tenant shall not change its Trade Name or
Legal name without prior notice to Landlord.
4. Is= The Initial Term of this Lease shall begin on the "Lease Commencement Date", so
set forth on page 1 of this Lease unless otherwise stated here. The phrase 'Term" as used in this Lease
shall mean the Initial Term and all renewal terms (if there are any) exercised.
Bent.
(a) Minimum Rent, Tenant shall pay, as rent for the Leased Premises, the Minimum Rent
indicated in Section 1. If the Commencement Date is not the first day of the month, rent for that month shall
be prorated. If any rent or other sum is not received by Landlord within ten (10) calendar days after its due
date, Tenant shall pay a late charge of ten percent (10%) of the overdue amount. If any payment under this
Lease is made by check and such check is returned by the payor for any reason, Tenant shall pay a returned
check charge of One Hundred. Dollars ($100.00). In addition, any rent or other sum not received by Landlord
when due shall bear interest from the due date to the payment date at the prime rate published from time to
time by the Wall Street Journal, plus two (2%). Landlord reserves the right to require cashier's check,
certified check, money order, or cash, and may refuse Tenant's check in Landlord's sole discretion.
(b) rnmrnnn Arm . Tenant shall pay as Additional Rent its pro-rata share of the cost of
operating, replacing improving, maintaining, repairing, and refurbishing the Common Areas ("Common Area
Charge"), which for purposes of this Section only, shall include all roofs of the Building. Such costs shall
include, without limitation, materials, supplies, equipment, and services purchased or hired; equipment used
for the maintenance of the Common Areas; landscaping, gardening, planting, cleaning, painting, striping
parking areas, repaving, lighting, and sanitation; removing snow, ice, and garbage; heating, ventilating, and
air-conditioning the enclosed areas other than the Leased Premises; fire protection and on-site security if
provided by Landlord in its sole discretion), water and sewage charges, storm water maintenance fees,
electricity and other utility services; costs of personnel, payments to governmental authorities, costs of
complying with rules and regulations of governmental authorities, Fire Insurance Rating Organizations, Board
of Fire Underwriters, insurance carvers, and other organizations having jurisdiction over the Building; and
Landlord's administrative costs (including any management fee payable by Landlord) in connection with the
operation of the Building ("Common Area Costs"). Landlord and Tenant agree that improvements performed
to the fmnt of the Ruilrtinn nrimadw fnr tho t+onafit of fho mfail - rnrmntki 6nnom me Ran,anVe Waart ahnif
commencing and ending on dates designated by Landlord, each installment being due on the first day of
each calendar month. At any time during any such twelve (12) month period, Landlord may re-estimate
Tenant's proportionate share of the Common Area Charges and thereafter adjust Tenants monthly
installments payable during such twelve (12) month period to reflect more accurately Tenants proportionate
share of the Common Area Charges. At the end of each twelve (12) month period, Landlord shah deliver to
Tenant a statement of the actual Common Area Charges for that twelve (12) month period. For the next
twelve (12) months, the monthly Common Area Charges will be adjusted to reflect the actual Common Area
Charges for the preceding twelve (12) months, plus the deficiency in Common Area Charges for the
preceding twelve (12) months based upon Tenants proportionate share of that deficiency. Tenant shall have
the option to pay its entire proportionate deficiency within thirty (30) days should Tenant so choose. At the
end of the initial term, or any renewal thereof, Tenant will pay its proportionate share of any deficiency within
twenty (20) days following receipt of notice from Landlord of the Tenant's proportionate share. If , at the end
of any twelve month period, Tenant has paid more than Tenants proportionate share of the actual Common
Area Charges for such period, such overage shall be credited as a payment toward Tenant's, proportionate
share of Common Area Charges for the following twelve month period. Upon reasonable notice, Landlord
shall make available for Tenants inspection (which inspection shall be at Tenants sole cost and expense) at
Landlord's office, during nominal business hours, Landlord's records relating to the Common Area Charges for
such preceding twelve (12) month period. Failure of Landlord to provide the statement called for hereunder
within the time prescribed shall not relieve Tenant from its obligations hereunder.
(c) Capital Improvements Fund. The Common Area Charge, subsection (b) above, includes
the costs of repairs to the roof and/or installation of a new roof, resurfacing of parking lots, along with
repairs and/or replacement of the air conditioning unit(s) and heating system. These four (4) items could
result in a substantial "Common Area Charge" for the year in which any of these items would need to be
replaced. Therefore, a Capital Improvements Fund, (hereinafter the "Fund"), limited in purpose to the roof,
parking lot air conditioning unit(s) and heating system shall be established. Tenant shall pay as Additional
Rent its pro-reta share of the Capital Improvements Fund on a monthly basis. The Fund is hereby capped
at $120,000.00, which amount is to be accumulated over a ten (10) year period. The determination of the
need for Capital Improvements to the four (4) items listed above shall be at the sole discretion of Landlord.
If expenditures from this Fund in any one (1)
year shall exceed the account balance of this Fund, Tenant's monthly pro rata payments to this Fund shall
be increased to make up the deficiency during the following twelve (12) months. If Tenant's initial term,
and any renewals thereof, shall expire before any expenditures are made from this Fund, Tenant shall not
be entitled to a refund of any contributions it has made to the Capital Improvement Funds. However,
should Landlord sell the real property herein to any third party not in any way related to Landlord, or its
members, Tenant shall be entitled to repayment of all its contributions to the Fund, minus ten (10%)
administration fees, plus its pro rata share of interest actually earned and accumulated in the Fund, minus
ten (10%) administration fees.
(d) Taxes. During the Term, Tenant shall pay as Additional Rent a prorate portion of the annual
real estate taxes assessed against the Building A Property, as stated in Section subsection ( m) above. All
taxes assessed prior to the Term but payable in whole or in installments after the Commencement Date, and
all taxes assessed during the Term but payable in whole or in installments after the Term, shall be adjusted
and prorated, so Tenant shah pay its prorate share for the Term and Landlord shall pay its prorate share for
the periods prior and subsequent to the Term. If at any time during the Term, under the Laws of the state in
which the Building is located or any political subdivision thereof, a tax on rents is assessed against Landlord
in the form of a license tax or otherwise, such tax shall be deemed a real estate tax and shall be included
within the amount Tenant is required to pay. Tenants prorate share of Real Estate Taxes may be reviewed,
adjusted and billed in the same manner set forth in Section 5, subsection (c) above.
(a) rmmpetition by Tenant Tenant shall not directly or indirectly engage in any similar or competing
business to that conducted by Tenant in the Leased Premises within a radius of five (5) miles from the
Leased Premises. If Tenant violates this covenant, then in addition to all other remedies available to
Landlord, Tenants gross sales in such similar or competing business shall be deemed Gross Sales and shall
be reported under this Section 5 for the period in which made, and Percentage Rent shall be calculated
thereon. For purposes of this subsection, Tenant shall be deemed to be indirectly engaging in a similar or
competing business if a stockholder or partner of Tenant, or Tenant, if an individual, or any family member of
any of the foregoing, shall have a financial interest in such similar or competing business or W, with Tenant's
consent, such similar or competing business is conducted under the same trade name as the business
conducted in the Leased Premises. (This section (e) does not include business currently being done by
tenant under e-church depot (sale of church-related products and Christian literature,) AFIRM - consignment
product placing, and Wingspread Publishers (publication of Christian Literature); these business practices
rinnP nndar tenant 71 IR I Tn 1
Lease or in writing, all payments of Minimum Rent and Additional Rent shall be payable monthly in advance
on or before the first day of each month during the Term, without prior demand and without offset, reduction,
defense, or counterclaim. All payments shall be made prior to the close of business (Eastern Standard Time)
on the date specified for such payment and in immediately available United States funds.
Security Deposit: (None)
8. Trades Firhjres. Tenant shall have the right to install its trade fixtures in the Leased Premises,
provided such installation shall not interfere with either the construction of the Building or the completion of
any improvements to the Leased Premises which Landlord may have specifically agreed in this Lease to
perform, and such installation shall be at the sole risk and expense of Tenant. All trade fixtures installed in
the Leased Premises by Tenant shall remain the property of, and shall be removable by, Tenant at the
expiration of the Term, provided Tenant is not in default under this Lease, and Tenant shall promptly repair,
or reimburse Landlord for the cost of repairing all damages to the Leased Premises caused by the removal of
those fixtures.
g. Contml of C4MMW AArpac anti paciiit;a,g by I andlord, The Common Areas shall at all times
be subject to the exclusive control and management of Landlord, and Landlord shall have the right, from time
to time, to establish, modify, and enforce reasonable rules and regulations with respect to the Common
Areas. Without limiting the foregoing, Landlord shall have the right to construct, maintain, and operate
lighting facilities on all Common Areas; to police the same; to change, in Landlord's sole discretion, the area,
level, location, quantity, and arrangement, from time to time, of the Common Areas; to close or discontinue
common use of all or any portion of the Common Areas to such extent as may, in the opinion of Landlord or
Landlord's counsel, be legally sufficient, necessary, or proper to prevent a dedication or the accrual of any
rights to any person or the public; and to do and perform such other acts in and to the Common Areas as
Landlord, in its sole discretion, determines to be necessary to improve the convenience and use thereof by
tenants or their officers, agents, employees, and customers, or to improve the profitability of the Building.
Landlord will operate and maintain the Common Areas in such manner as Landlord, in its sole discretion,
shall determine from time to time. Without limiting the scope of such discretion, Landlord shall have the full
right and authority to employ all personnel and to make all rules and regulations pertaining to the proper
operation and maintenance of the Common Areas and facilities.
10. Use of Ping Arpac,
(a) All automobile parking areas, driveways, entrances, and exits in or near the Building,
and other facilities furnished by Landlord in or near the Building, shall at all times be subject to Landlord's
exclusive control and management, and Landlord shall have the right from time to time to establish, modify,
and enforce reasonable rules and regulations with respect to all such facilities and areas.
(b) It is expressly understood that the parking areas in the Common Areas are intended
primarily for use by the Servants Heart Retail Customers in the Building, and Tenant accordingly agrees that
its employees will not use those parking areas or any of the driveways, streets, or vacant land in the Building
for parking or storing any automobile, truck, or any other vehicle owned or used by any such employee,
except as Landlord may from time to time approve in writing, and with the further exception that Tenant, to
include Tenants employees, may use the parking spaces in front of the building which are most remote from
the main entrance to the Servants Heart Store in the event that parking elsewhere on the land adjacent to
the Building is unavailable, until such time as additional parking is made available on said land.
(c) Parking area in front of building is available expressly for retail customer use. Parking
for office employees is to be along the side of the building by receiving, except as provided otherwise in
Paragraph 10 (b). (Exceptions in the cases of any employees holding handicap passes.)
11. Maintananr a bV I A=diry-d. Landlord shall, within a reasonable time after having received
written notice from Tenant of such a need, make such repairs to the roof, outside walls (except window,
storefront, and doors), gutters, and downspouts of the Building as may be necessary to keep the Building in
good condition and repair unless such repairs are caused by the negligence or willful act of Tenant or any of
its agents, employees, or contractors, in which event such repairs shall be made by and a( the expense of
Tenant. Landlord will not be responsible for any damage resulting from any leak or defect in the roof,
sidewalis, gutters, or downspouts unless such damage is due to Landlord's failure to repair such defect within
a reasonable time after Landlord has received notice from Tenant of the need to repair such defect. Landlord
shall maintain in good condition and repair, and adequately light, the parking areas of the Building.
12. Mainfmance by Tenant
all repairs and replacements necessary to keep the Leased Premises and the appurtenances thereto in good
condition and repair except only those repairs which Landlord has expressly agreed under this Lease to
make. Tenant shall, at its own cost and expense, keep the Leased Premises and entryways, sidewalks,
driveways, and delivery areas adjacent to the Leased Premises clean and free from obstruction, garbage,
dirt, snow, and ice. Tenant shall store all garbage in fully-closed containers in the area designated by
Landlord, and Tenant shall pay all costs incident to the removal thereof. Tenant shall not bum or otherwise
dispose of any garbage in or about the Leased Premises. Tenant shall not tape windows or attach wood
coverings to aluminum frame windows.
13, StindIV rrn_maanLc-of?e? anti. Tenant shall: (a) comply with all federal, state, and municipal
laws, ordinances, and regulations relating to the Leased Premises and its Permitted Use, including, without
limitation, all environmental laws, rules and regulations (collectively the "Environmental Laws") and all laws,
rules and regulations in connection with the Americans with Disabilities Act of 1990, as amended (the "ADA");
(b) notify Landlord immediately upon receipt of all notices or other communications by governmental
authorities regarding possible or actual noncompliance with laws, ordinances, or regulations; (c) pay promptly
for all electricity, water, and other utilities consumed on or in connection with the Leased Premises, and all
sewage disposal charges assessed against the Leased Premises; (d) not use or permit to be used any
advertising medium or device, such as phonograph, radio, or public address system (except for the public
address / intercom system which serves the interior of the Leased Premises), without Landlord's prior written
consent; (e) not use or permit to be used the Leased Premises for any illegal or immoral purpose; (f) not hold
any fire, bankruptcy, going out-of-business, or auction sales without Landlord's prior written consent, (g) not
use the sidewalks or any other portions of the Common Areas for any purpose relating to the selling of
merchandise or services; and (h) keep the Leased Premises free from insects, pests, and vermin of all kinds,
and for that purpose Tenant shall use, at Tenant's cost, such pest extermination contractor as Landlord may
direct and at such intervals as Landlord may require.
The Leased Premises shall not be used for the treatment, storage, use, or disposal of toxic or
hazardous wastes or substances, or any other substance, exposure to which is prohibited, limited, or
regulated by a governmental or quasi-governmental authority or which, even if not so regulated, could or
does pose a hazard to the health and/or safety of the occupants of the Building or surrounding property.
Tenant shall indemnify and told Landlord harmless from and against any expense or liability (including
attorney's fees) arising under the Environmental Laws resulting from Tenant's use of the Leased Premises or
any acts and/or omissions of Tenant, its agents, employees, invitees, or independent contractors.
14. ?.
Tenant is accepting the leased Premises "as is", and Tenant shall pay the cost of any improvements
or alterations desired by Tenant. Any such improvements or alterations to the Leased Premises shall be
performed only after Tenant has obtained the prior written consent of Landlord, which consent may be
withheld for any or no reason. Tenant has inspected the Leased Premises and is satisfied with its physical
condition. Any improvements or alterations to the Leased Premises in addition to those specified on the
Build-Out Rider shall be performed at Tenant's expense, and only after Tenant has obtained the prior written
consent of Landlord, which consent may be unreasonably withheld.
1& roMplranrxi with A_mRdnansw6th Disahilition Arl of 1990 Tenant acknowledges it is a
"public accommodation" as defined by the ADA. If the ADA requires that action be taken with respect to the
Leased Premises (not including the Common Areas), including without limitation removing barriers and
altering the Leased Premises in accordance with the ADA Accessibility Guidelines, such action shall be taken
by Tenant; provided, however, that K such action was required to be taken during Landlord's build-out (if
applicable) of the Leased Premises, Landlord shall take such action. Tenant shall notify Landlord
immediately upon receipt of an oral or written complaint or notice by an employee, customer, client, invitee,
licensee, or governmental authority regarding the ADA.
16. Assionment and Subletting. Without Landlord's prior written consent, Tenant shall not
(either voluntarily, involuntarily, or by operation of Law) assign, transfer, mortgage, pledge, hypothecate, or
encumber this Lease or any interest under this Lease; nor sublet or grant concessions of or to the Leased
Premises, in whole or in part; nor allow any person (other than Tenant, its employees, agents, servants, and
invitees) to occupy or use all or part of the Leased Premises. Landlord's consent may be withheld for any or
no reason. Regardless of any such consent, no assignment or subletting shall release Tenant of its
obligations or alter the primary liability of Tenant to pay rent and perform all its other obligations under this
Lease. Landlord's consent to one assignment, subletting, occupation, or use by any other person shall not
be deemed a consent to any subsequent assignment, subletting, occupation, or use by another person. The
transfer of fifty percent (50%) or more of Tenant's stock, if Tenant is a corporation, or the transfer of fifty
percent (50%) or more of a partnership interest in Tenant, if Tenant is a partnership, shall constitute an
assignment under the temmc of thie 1 ....
square foot of the sublet portion of the Leased Premises exceeds the rental rate per square foot of this
Lease, then Tenant shall pay to Landlord each month, together with the rent due under this Lease, an
amount equal to one half (1/2) of the amount by which the rent due under the sublease exceeds the rent
which would be due for the sublet space under the terms of this Lease, computed on a per square foot basis.
17. Condemnation. If the whole or any part of the Leased Premises shall be taken by power of
eminent domain or condemned by any competent authority for any public or quasi-public use or purpose, or if
any adjacent property or street shall be so taken or condemned, or reconfigured or vacated by such authority
in such manner as to require the use, reconstruction, or remodeling of any part of the Leased Premises, or if
Landlord shall grant a deed or other instrument in lieu of such taking by eminent domain or condemnation,
Landlord (and 'rf more than ten percent (10%) of the rentable area of the Leased Premises is taken, or if
access to the Leased Premises or any common restrooms serving the same is materially impaired) Tenant
shall have the option to terminate this Lease upon ninety (90) days notice, provided such notice is given no
later than one hundred eighty (180) days after the date of such taking, condemnation, configuration, vacation,
deed, or other instrument. Landlord shall be entitled to receive the entire award or payment in connection
therewith, and Tenant waives any right it may have to any such award or payment All rent shall be
apportioned as of the date of such termination or the date of such taking, whichever shall first occur. If any
part of the Leased Premises shall be taken, and this Lease shall not be so terminated, the rent shall be
proportionately abated.
18. Damanp by FIro nr QWP-r Car,taitV. If the Leased Premises or a substantial portion of the
Building is damaged by fire or other casualty during the Term, Landlord may, at its sole option, either (i)
restore the Leased Prerises with reasonable dispatch to substantially the same condition they were in prior
to such damage, Insofar as the proceeds from Landlord's insurance permit, or (ii) terminate this Lease. If
Landlord elects to restore the Leased Premises, Landlord shall have no.liabiltty to restore any improvements
as may have been made to the Leased Premises, whether before or after the date of this Lease, nor to
restore any of Tenant's fixtures, decorations, equipment, furniture, or inventory. Landlord's sole
responsibility, if any, shall be to deliver to Tenant a shell space with roof, floor, exterior walls, windows, and
doors. If the Leased Premises are rendered untenable in whole or in part as a result of such damage and
this Lease is not terminated, the Minimum Rent and Additional Rent payable shall be equitably and
proportionately abated (according to loss of use) during the period intervening between the date of such
damage and the date the Leased Premises are restored. If Landlord elects to terminate this Lease, all rent
payable shall be abated as of the date of such damage and Tenant shall remove all of its property from the
Leased Premises within thirty (30) days after the notice of termination is given, provided Tenant is not in
default at the time.
19. 1 andinni'e InsumWe. Landlord shall maintain during the Term such commercial public
liability insurance for the Common Areas as Landlord deems appropriate, and shall also maintain during the
Term primary, non-contributory insurance on the Building against fire, and extended coverage or "all-risk"
insurance, in an amount equal to the full insurable replacement value of the Building (excluding costs of
excavation, foundations and footings, and such risks required to be covered by Tenants insurance), or such
other amount necessary to prevent Landlord from being a co-insured (collectively, the "Insurance"). Tenant
shall pay as Additional Rent in equal monthly installments, in advance, without prior demand or offset of any
kind, its prorate share of the cost of the Insurance. Tenant's prorate share of the Insurance is stated in
Section 1, subsection (1), of this lease. Tenants prorate portion of the Insurance may be reviewed, adjusted
and billed in the same manner as set forth in Section 5, subsection (c) above.
20. Tpoanrc Ingwance.
(a) Tenant shall, at all times during the Term and at its own cost and expense, carry: (i)
commercial general liability insurance on the Leased Premises (including Common Areas adjoining the
Leased Premises) with limits of not less than $1,000,000.00 for injury or death to one person, $2,000,000.00
for injury or death to more than one person, and $500,000.00 for property damage; (ii) "all-risk" casualty
insurance, written at replacement cost value and with replacement cost endorsement, covering all Tenants
personal property in the Leased Premises (including, without limitation, inventory, trade fixtures, floor
coverings, furniture, and other property removable by Tenant under the provisions of this. Lease) and all
Leasehold improvements installed in the Leased Premises by or on behalf of Tenant, (iii) plate glass
insurance; and (iv) if and to the extent required by Law, workmen's compensation or similar insurance.
(b) All such insurance policies shall name Landlord as a named insured and shall be written by
companies acceptable to Landlord and in form acceptable to Landlord. Each such policy shall also contain a
provision prohibiting cancellation without thirty (30) days' prior written notice to Landlord or its designee.
Certificates of such insurance policies shall be delivered to Landlord promptly after the issuance of the
the Leased Premises, including vestibules, entryways, and walkways adjoining the Leased Premises, and the
loading platform area, if any, allocated to the use of Tenant. Tenant shall also indemnify and hold Landlord
harmless from such liability for damage in other parts of the Building if caused by Tenant's negligence,
affirmative act, or breach of its obligations under this Lease. All property kept, stored, or maintained in the
Premises shall be kept, stored, or maintained at Tenants sole risk. Tenant waives all claims against and
releases Landlord, and Landlord's employees and agents, from liability for damages or injury suffered by
Tenant or any person claiming through Tenant as a result of any accident or other occurrence in or upon the
Leased Premises or any other part of the Building, unless the damage or injury was caused by Landlord's
gross negligence or willful misconduct.
22. Yvai- of fi-ixmarion Tenant waives all claims against Landlord for any damage or loss
Tenant may suffer which is covered by an insurance policy carried by Tenant (or which Tenant is required to
carry under this Lease); and any insurance policy carried by Tenant covering the Leased Premises, its
contents, or any part thereof, shall contain an express waiver of any right of subrogation against Landlord by
the issuer of the policy. Landlord waives all claims against Tenant for any damage or loss Tenant may suffer
which is covered by an Insurance policy carried by Landlord (or which Tenant is required to carry under this
Lease); and any insurance policy carried by Landlord covering the Leased Premises, its contents, or any part
thereof, shall contain an express waiver of any right of subrogation against Tenant by the issuer of the policy.
23. Default.
23.1 "Fyent of rmfal llt" rlafinPd,
Any one or more of the following events shall constitute an "Event of Default':
(a) The sale of Tenant's interest in the Premises under attachment, execution or similar
legal process, or if Tenant is adjudicated as bankrupt or insolvent under any state bankruptcy or insolvency
law or an order for relief is entered against Tenant under the Federal Bankruptcy Code and such adjudication
or order is not vacated within ten (10) days.
(b) The commencement of a case under any chapter of the Federal Bankruptcy Code
by or against Tenant or any guarantor of Tenant's obligations hereunder, or the filing of a voluntary or
involuntary petition proposing the adjudication of Tenant or any such guarantor as bankrupt or insolvent, or
the reorganization of Tenant or any such guarantor, or an arrangement by Tenant or any such guarantor with
its creditors, unless the petition is filed or case commenced by a party other than Tenant or any such
guarantor and is withdrawn or dismissed within thirty (30) days after the date of its filing.
(c) The admission in writing by Tenant or any such guarantor of its inability to pay its
debts when due;
(d) The appointment of a receiver or trustee for the business or property of Tenant or
any such guarantor, unless such appointment shall be vacated within ten (10) days of its entry.
(e) The making by Tenant or any such guarantor of an assignment for the benefit of its
creditors, or if in any other manner Tenant's interest in this Lease shall pass to another by operation of law.
(f) The failure of Tenant to pay any Minimum Rent, Additional Rent, Percentage Rent
("Renter') or other sum of money when due.
(g) Default by Tenant in the performance or observance of any covenant or agreement
of this Lease (other than a default involving the payment of money), which default is not cured within ten (10)
days after the giving of notice thereof by Landlord, unless such default is of such nature that it cannot be
cured within such ten (10) day period, in which case no Event of Default shall occur so long as Tenant shall
commence the curing of the default within such ten (10) days period and shall thereafter diligently prosecute
the curing of same; provided, however, if Tenant shall default in the performance of any such covenant or
agreement of this Lease two (2) or more.times in any twelve (12) month period, then notwithstanding that
each of such defaults shall have been cured by Tenant, any further similar default shall be deemed an Event
of Default without the ability for cure.
(h) The vacation or abandonment of the Premises by Tenant at any time following
delivery of possession of the Premises to Tenant.
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Upon the occurrence of an Event of Default, Landlord, without notice to Tenant in any instance (except where
expressly provided for below or by applicable law) may do any one or more of the following:
(a) With or without judicial process, enter the Premises and take possession of any and
all goods, inventory, equipment, fixtures and all other personal property of Tenant, which is or may be put into
the Premises during the Term, whether exempt or not from sale under execution or attachment (it being
agreed that said property shall at all times be bound with a lien in favor of Landlord, provided however that
any such lien shall be subordinate to any and all secured creditors of Tenant, and shall be chargeable for all
Rental and for the fulfillment of the other covenants and agreements herein contained), and Landlord may
seA all or any part thereof at public or private sale, subject to the interests of any secured creditor of Tenant.
Tenant agrees that ten (10) days prior written notice of any public or private sale shall constitute reasonable
notice. The proceeds of any such sale shall be applied, first, to the payment of all costs and expenses of
conducting the sale or caring for or storing said property (including reasonable attorneys' fees); second,
toward the payment of any indebtedness, including (without limitation) indebtedness for Rental, which may be
or may become due from Tenant to Landlord; and third, to pay Tenant, on demand, any surplus remaining
after all indebtedness of Tenant to Landlord has been fully paid;
(b) Perform, on behalf and at the expense of Tenant, any obligation of Tenant under
this Lease which Tenant has failed to perform and of which Landlord shall have given Tenant notice, the cost
of which performance by Landlord, together with interest thereon at the Default Rate from the date of such
expenditure, shall be deemed Additional Rental and shall be payable by Tenant to Landlord upon demand.
Notwithstanding the provisions of this clause (b) and regardless of whether an Event of Default shall have
occurred, Landlord may exercise the remedy described in this clause (b) without any notice to Tenant 9
Landlord, in its good faith judgment, believes it would be materially injured by failure to take rapid action or if
the unperformed obligation of Tenant constitutes an emergency;
(c) Elect to terminate this Lease and the tenancy created hereby by giving ten (10)
days prior written notice of such election to Tenant, and reenter the Premises, without the necessity of legal
proceedings, and remove Tenant and all other persons and property from the Premises, and may store such
property in a public warehouse or elsewhere at the cost of and for the account of Tenant without resort to
legal process and without Landlord being deemed guilty of trespass or becoming liable for any loss or
damage occasioned thereby; or
(d) Exercise any other legal or equitable right or remedy which it may have.
Any costs and expenses incurred by Landlord (including, without limitation, reasonable attorneys' fees) in
enforcing any of its rights or remedies under this Lease shall be deemed to be Additional Rental and shall be
repaid to Landlord by Tenant upon demand.
23.3 Damages.
if this Lease is terminated by Landlord pursuant to Section 23.2, Tenant nevertheless shall remain liable for
(a) any Rental and damages which may be due or sustained prior to such termination, all reasonable costs,
fees and expenses including, but not limited to, reasonable attorneys' fees, costs and expenses incurred by
Landlord in pursuit of its remedies hereunder, or in renting the Premises to others from time to time (all such
Rental, damages, costs, fees and expenses being referred to herein as 'Termination Damages"), and (b)
additional damages (the "Liquidated Damages"), which, at the election of Landlord, shall be either:
(i) an amount equal to the Rental which, but for termination of this Lease, would have
become due during the remainder of the Term, less the amount of Rental, if any, which Landlord shall receive
during such period from others to whom the Premises may be rented (other than any Additional Rental
received by Landlord as a result of any failure of such other person to perform any of its obligations to
Landlord), in which case such Liquidated Damages shall be computed and payable in monthly installments,
in advance, on the first day of each calendar month following termination of the Lease and continuing until the
date on which the Term would have expired but for such termination, and any suit or action brought to collect
any such Liquidated Damages for any month shall not in any manner prejudice the right of Landlord to collect
any Liquidated Damages for any subsequent month by a similar proceeding; or
(ii) an amount equal to the present worth (as of the date of such termination) of Rental
which, but for termination of this Lease, would have become due during the remainder of the Term, less the
fair rental value of the Premises, as determined by an Independent real estate appraiser named by Landlord,
in which case such Liquidated Damages shall be payable to Landlord in one lump sum on demand and shall
bear interest at the Default Rate until paid. For purposes of this clause (ii), "present worth" shall be computed
by diCQnlinfinn enrh am-M to --# -.11. n6 - 1: .a -I- i - ..__ -
which otherwise would have constituted the balance of the Term) and on such terms and conditions (which
may include concessions or free rent and alterations of the Premises) as Landlord, in its sole discretion, may
determine, but Landlord shall not be liable for, nor shall Tenant's obligations hereunder be diminished by
reason of, any failure by Landlord to relet the Premises or any failure by Landlord to collect any rent due upon
such reletting.
Nothing contained in this Lease shall limit or prejudice the right of Landlord to prove and obtain, in
proceedings for the termination of this Lease by reason of bankruptcy or insolvency, an amount equal to the
maximum allowed by any statute or rule of law in effect at the time when, and governing the proceedings in
which, the damages are to be proved, whether or not the amount be greater, equal to,, or less than the
amount of the loss or damages referred to above. The failure or refusal of Landlord to relet the Premises or
any part or parts thereof shall not release or affect Tenant's liability for damages.
23.4 RP ipS In Fvpnf of Rankninirw or (VhPr 12MCeedunn
(a) Anything contained herein to the contrary notwithstanding, if termination of this
Lease shall be stayed by order of any court having jurisdiction over any proceeding described in paragraph
(b) of Section 23. 1, or by federal or state statute, then, following the expiration of any such stay, or K Tenant
or Tenant as debtor-in-possession or the trustee appointed in any such proceeding (being collectively
referred to as "Tenant' only for the purposes of this Section 23.4) shall fail to assume Tenant's obligations
under this Lease within the period prescribed therefor by law or within fifteen (15) days after entry of the order
for relief or as may be allowed by the court, or if Tenant shall fail to provide adequate protection of Landlord's
right, We and interest in and to the Premises or adequate assurance of the complete and continuous future
performance of Tenants obligations under this Lease, Landlord, to the extent permitted by law or by leave of
the court having jurisdiction over such proceeding, shall have the right, at its election, to terminate this Lease
on fifteen (15) days' notice to Tenant and upon the expiration of said fifteen (15) day period this Lease shall
cease and expire as aforesaid and Tenant shall immediately quit and surrender the Premises as aforesaid.
Upon the termination of this Lease as provided above, Landlord, without notice, may re-enter and repossess
the Premises using such force for that purpose as may be necessary without being liable to indictment,
prosecution or damages therefor and may dispossess Tenant by summary proceedings or otherwise.
(b) For the purposes of the preceding paragraph (a), adequate protection of Landlord's
right, tide and interest in and to the Premises, and adequate assurance of the complete and continuous future
performance of Tenants obligations under this Lease, shall include, without limitation, the following
requirements:
that Tenant comply with all of its obligations under this Lease;
(ii) that Tenant pay to Landlord, on the first day of each month occurring
subsequent to the entry of such order, or the effective date of such stay, a sum equal to the amount by which
the Premises diminished in value during the immediately preceding monthly period, but, in no event, an
amount which is less than the aggregate Rental payable for such monthly period;
(iii) that Tenant continue to use the Premises in the manner originally required
by this Lease;
(iv) that Landlord be permitted to supervise the performance of Tenants
obligations under this Lease;
(v) that Tenant pay to Landlord within fifteen (15) days after entry of such order
or the effective date of such stay, as partial adequate protection against future diminution in value of the
Premises and adequate assurance of the complete and continuous future performance of Tenants
obligations under this Lease, an additional security deposit in an amount acceptable to Landlord;
(vi) that Tenant has and will continue to have unencumbered assets after the
payment of all secured obligations and administrative expenses to assure Landlord that sufficient funds will
be available to fulfill the obligations of Tenant under this Lease;
(vii) that if Tenant assumes this Lease and proposes to assign the same
(pursuant to Title 11 U.S.C. § 365, or as the same may be amended) to any person who shall have made a
bona fide offer to accept an assignment of this Lease on terms acceptable to such court having competent
jurisdiction over Tenants estate, then notice of such proposed assignment, setting forth (x) the name and
address of such person, (y) all of the terms and conditions of such offer, and (z) the adequate assurance to
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and option, to be exercised by notice to Tenant given at any time prior to the effective date of such proposed
assignment, to accept, or to cause Landlord's designee to accept, an assignment of this Lease upon the
same terms and conditions and for the same consideration, if any, as the bona fide offer made by such
person less any brokerage commissions which may be payable out of the consideration to be paid by such
person for the assignment of this Lease; and
(viii) that if Tenant assumes this Lease and proposes to assign the same, and
Landlord does not exercise its option pursuant to paragraph (vii) of this Section 23.4, Tenant hereby agrees
that:
(A) such assignee shall have a net worth not less than the net worth of
Tenant as of the Commencement Date, or such Tenant's obligations under this Lease shall be
unconditionally guaranteed by a person having a net worth equal to Tenant's net worth as of the
Commencement Date;
(B) such assignee shall not use the Premises except subject to all the
restrictions contained in this Lease;
(C) such assignee shall assume in writing all of the terms, covenants
and conditions of this Lease including, without limitation, all of such terms, covenants and conditions
respecting the Permitted Use and payment of Rental, and such assignee shall provide Landlord with
assurances satisfactory to Landlord that it has the experience in operating stores having the same or
substantially sirnilar uses as the Permitted Use, in first-class shopping centers, sufficient to enable it so to
comply with the terms, covenants and conditions of this Lease and successfully operate the Premises for the
Permitted Use;
(D) such assignee shall indemnify Landlord against, and pay to
Landlord the amount of, any payments which Landlord may be obligated to make to any Mortgagee by virtue
of such assignment;
(E) such assignee shall pay to Landlord an amount equal to the
unamortized portion of any construction allowance made to Tenant; and
(F) if such assignee makes any payment to Tenant, or for Tenant's
account, for the right to assume this Lease (including, without limitation, any lump sum payment, installment
payment or payment in the nature of rent over and above the Rental payable under this Lease), Tenant shall
pay over to Landlord one-half of any such payment, less any amount paid to Landlord pursuant to clause (E)
above on account of any construction allowance.
24. Whivad by i andlnrd Landlord's failure to insist upon strict performance by Tenant of any
obligation under this Lease, irrespective of the length of time for which such failure continues, shall not be
construed as a waiver or relinquishment of Landlord's right to demand strict compliance in the future. The
receipt and acceptance by Landlord of rent with knowledge of the breach of any obligation hereof shall not be
deemed a waiver of such breach, and no waiver by Landlord of any provision of this Lease shall be deemed
to have been agreed upon unless expressed in a writing signed by the parties.
25. Liens Tenant shall pay all sums of money due for labor, services, materials, supplies and
equipment furnished at Tenant's request with respect to the Leased Premises or any other part of the
Building. If a mechanic's, materialman's, or other lien (or notice of intent to file such a lien) is filed or recorded
against the Leased Premises, the Building, or Landlord's interest in either, based upon labor, services,
materials, supplies, equipment, or the like ordered, or alleged to have been ordered by Tenant, Tenant shall
cause such lien to be discharged of record within ten (10) days after Tenant first has knowledge of such lien.
If such lien is not discharged within the ten (10) day period, Landlord may (but shall not be obligated to)
cause such discharge by (i) payment to the lienor, (ii) deposit of substitute security with a court having
jurisdiction, (iii) bonding, or (iv) such other means chosen by Landlord; and the entire cost of the discharge
shall be paid to Landlord by Tenant upon demand. Tenant shall, upon request, furnish Landlord with
contractors' affidavits, full and final waivers of right to lien, and receipted bills covering all labor and materials
expended and used in or about the Leased Premises by or at the request of Tenant.
26. Rigs Awninnc and cannniac. Tenant shall not place or display (or cause to be placed or
displayed) on any exterior door, wall, or window of the Leased Premises any sign, • awning, canopy,
advertising matter, or other thing of any kind, and shall not place or display any decoration, lettering, or
advertising matter on the glass of any window or door of the Leased Premises, without Landlord's prior
written aooroval. Tenant shall maintain such %inn awninn rannnv dornratinn lpttarinn advadlCinn moffof
27. FYhih*bt nddnada, RidgA. anti Ragidsi inns. All Exhibits, Addenda and Rules and
Regulations appended to this Lease are hereby incorporated into this Lease, and Tenant shall comply with
and observe the same. Tenant's failure to comply with and observe the same shall constitute a breach of this
Lease. Landlord reserves the right to amend, supplement, or add to such Rules and Regulations from time
to time.
28. RiirmWer c,r PWMi M. On expiration or sooner termination of the Term, Tenant shall
surrender to Landlord the Leased Premises and all Tenant's improvements and alterations, broom clean, in
good order, condition, and repair, except for ordinary wear and tear or condemnation or destruction of the
Leased Premises, and except for trade fixtures that Tenant has removed. Tenant shall also deliver to
Landlord all keys to the Leased Premises and the combination to any safe, remove all its personal property,
and make all repairs and reimbursements required pursuant to this Lease; provided, however, Tenant may
not remove its personal property from the Leased Premises without Landlord's prior written consent, if Tenant
is in breach or default hereunder.
Landlord may elect to retain or dispose of in any manner any alterations or Tenant's personal
property that Tenant does not remove from the premises on expiration or termination of the Term. Title to
any such alterations or Tenant's personal property that Landlord elects to retain or dispose of after expiration
of the Term shall vest in Landlord. Tenant waives all claims against Landlord for any damage to Tenant
resulting from Landlord's retention or disposition of any such alterations or personal property. Tenant shall
be liable to Landlord for Landlord's costs of storing, removing, and disposing of any alterations or Tenant's
personal property which Landlord does not elect to acquire.
29. lialdovec. Tenant shall indemnify and hold Landlord harmless from and against all costs,
claims, loss, or liability resulting from delay by Tenant in surrendering the Leased Premises, including,
without limitation, any claims made by any succeeding tenant founded on such delay. The parties recognize
and agree that the damage to Landlord resulting from any failure by Tenant to timely surrender possession of
the Leased Premises will be extremely substantial, will exceed the amount of the Minimum Rent payable
under this Lease, and will be impossible to measure accurately. Tenant therefore agrees that If possession
of the Leased Premises is not surrendered to Landlord within twenty-four (24) hours after the date of the
expiration or termination of the term, then Tenant shall pay, for each month and for each portion of any
month during which Tenant holds over in the Leased Premises after the expiration or termination of the Term,
two times the aggregate of that portion of the Minimum Rent which was payable under this Lease during the
last month of the Term. Nothing contained in this Lease shall be deemed to permit Tenant to retain
possession of the Leased Premises after the expiration of the Term. The provisions of this Section shall
survive the expiration or termination of the Term.
30. This Lease is and shall be subject and subordinate to any
mortgage, deed of trust, underlying leasehold estate, or other arrangement or right to possession that may
now or hereafter be placed upon or affect the Leased Premises or the land of which the Leased Premises is
a part, or against any building hereafter placed upon the land of which the Leased.Premises is a part, to all
advances to be made thereunder, to the interest and principal payable thereon, and to all renewals,
replacements, modifications, consolidations, and extensions thereof. Upon Landlord's request Tenant shall
execute and deliver such documents, in such terms as Landlord reasonably requests, to evidence the same.
Upon request of any such mortgagee, Tenant shall attom to and acknowledge the foreclosure purchaser or
purchasers as Landlord hereunder.
31. Estoppel Certificates. Upon Landlord's request, Tenant shall execute, acknowledge, and
deliver to Landlord a written statement, addressed to such person as Landlord may request, (a) certifying that
this Lease is in full force and effect and unmodified (or if modified, specifying the modifications), and that
Landlord is not in default under this Lease (or if a default is alleged, specifying the default), (b) stating the
date to which rent and any other charges have been paid by Tenant and the address to which notices to
Tenant should be sent, and (c) certifying or stating such other matters as may be required by Landlord. It
Landlord has not received a response within ten (10) days of any such request, such certificate shall be
deemed acceptable to Tenant, whereupon Landlord shall be appointed as Tenant's aftomey-in-fact to
execute and deliver such certificate.
32. Future R_... nan?i? If all or part of the Building can be refinanced or further financed only
upon the basis of modifications of this Lease, Tenant shall enter into a written agreement with Landlord
making such Lease modifications as may be required; provided, however, Tenant shall not be required to
make any such modifications relating to the amount of Rent, the use of the Leased Premises, the duration of
the Term, or the improvements, if any, to be made by Landlord to the Leased Premises.
34. FnM eMaj iiM. Whenever Tenant or Landlord is required by the terms of this Lease or by
law to perform any contract, act, work, labor or services, or to discharge any lien against the Leased
Premises, or to perform and comply with any laws, rules, orders, ordinances, or regulations, but is unable to
perform such act(s), then Tenant or Landlord, as appropriate, shall not be deemed to be in default and the
other party shall not enforce or exercise any of its rights under this Lease, if and so long as nonperformance
or default is directly caused by strikes, non-availability of materials, war or national defense preemptions,
governmental restrictions, acts of God, acts of the other party, or other similar causes beyond the reasonable
control of the non-performing party. Tenant and Landlord shall in any event pay any sum of money required
to discharge any lien Incurred by them if at any time the Leased Premises, or any part thereof, is in danger of
being foreclosed, forfeited, or lost by reason of such lien.
35. l imitation of I gndbrd!s I iahiiihr. Except to the extent insurance proceeds are actually
received by Landlord, Landlord shall not be responsible or liable for latent defects, deterioration, or change in
the condition of the Building, the. Common Areas, or the Leased Premises, or for any damage resulting
therefrom, whether to person or property, or for loss to any property of Tenant as a result of theft or
misplacement, or for inconvenience, business interruption, or loss of business of Tenant for any reason. To
the extent covered by Tenants insurance, Tenant shall indemnify and hold Landlord harmless from and
against any and all claims arising out of Tenants use or occupancy of, or from any other activity permitted or
suffered by Tenant in or about, the Leased Premises, the Building, or shall be fully liable for, and shall
indemnify Landlord against, all such claims. Regardless of any other provision of this Lease, if Landlord, or
its employees, officers, or partners are ordered to pay Tenant a money judgment because of Landlord's
default, then Tenants sole remedy to satisfy the judgment shall be Landlord's interest in the Building,
including the rental income and proceeds from sale and any insurance proceeds received because of
damage to the Building that are available for use by Landlord. The foregoing shall not be deemed to limit
Tenants right, if any, to obtain injunctive relief or specific performance.
36. Notices. Any notice, demand, consent, request, or other communication required or
permitted under this Lease shaft be in writing and shall be given by hand delivery or sent by the United States
Mail by certified mail, return receipt requested, postage prepaid, and addressed as indicated in Section 1,
subsection (m), Notice shall be deemed given when hand delivered or two (2) days after deposit with the
United States Postal Service. The parties may change their respective addresses by written notice to all
other parties.
37. Q iptFnigmart. Landlord covenants that Tenant, on paying all rents and performing all the
obligations set forth in this Lease, shall have and enjoy quiet and peaceable possession of the Leased
Premises during the Term.
38. Enti?a___ agmmnf. This Lease contains the entire agreement between the parties with
respect to the leasing of the Leased Premises and supersedes, merges and replaces all prior written or oral
agreements, negotiations, offers, representations, and warranties with respect to the leasing of the Leased
Premises. This agreement cannot be altered, waived, or modified in any way, including the provisions of this
Section, except in a writing signed by the parties, No course of dealing between the parties, no usage of
trade, and no paroi or outside evidence of any nature shall be used to modify, interpret, or supplement any
provision of this Lease.
39. Sunni-I The representations, warranties, and agreements of the parties contained in this
Lease and in all other documents delivered in connection with this Lease shall survive the expiration or
sooner termination of this Lease.
40. Sevembility If any provision of this Lease is unenforceable, the remainder of this Lease
shah continue in effect and be construed as if the unenforceable provision had not been contained in this
Lease. Each provision of this Lease shah be valid and enforceable to the fullest extent permitted by law.
41. Sucoeagam and Assigns. This Lease shall be binding upon and inure to the benefit of the
parties and their respective heirs, personal representatives, successors, and assigns; provided, however,
that this Section shah not be construed to permit the assignment of this Lease except as expressly provided.
42. Third Patty REan fiJadas. The provisions of this Lease are intended to benefit only the
parties to this Lease. No person not a party to this Lease shall be deemed a third party beneficiary of this
Lease nor shall any such person be authorized or empowered to enforce the provisions of this Lease, except
to the extent such a person becomes a permitted assignee of one of the parties.
43. Venue Regardless of what venue would otherwise be permissive or required, the parties
stipulate that all actions arising under or atfectino this Lea.. ehail hp hmnnht in tho r.nnrt of r nmmnn Mgme
44. r anoant to hirigd?tjpn -nri Ran iro ?f Prn eSg The parties irrevocably submit to the
jurisdiction of the state courts of the Commonwealth of Pennsylvania and to the jurisdiction of the United
States District Court for the Middle District of Pennsylvania, for the purpose of any suit, action, or other
proceeding arising under or affecting this Lease.
45. C;ounh? _.:nn, )a; & In computing the number of days for purposes of this Lease, all days shall
be counted, including weekends and holidays; provided, however, that if the last day for taking any action
under this Lease shall fall on a Saturday, Sunday or banking holiday, the time for taking such action shall be
extended to the next regular business day.
46. Nil-bar and Gender When used in this Lease, the singular includes the plural, the plural
includes the singular, and the use of any gender includes any other gender, as circumstances may require.
The term "person" includes both natural persons and entities.
47. Headings. The headings contained in this Lease are for the convenience of the parties only
and are not a part of the substantive agreement of the parties nor shall they affect the meaning or
interpretation of any provision of this Lease in any way.
48. Coun?a ? . This Lease may be executed in multiple counterparts. When at least one (1)
copy of this Lease has been executed by each party to this Lease, this Lease shall be in full force and effect,
and all of such counterparts shall be read together as a single agreement.
49. Remrding. Upon request of either Tenant or Landlord, the parties shall execute a short form
of this Lease in a written document witnessed and acknowledged in form capable of being recorded in the
public records, which short form Lease shall be recorded at the sole cost and expense of the party requesting
the same in the Office of the Recorder of Deeds in and for Cumberland County, Pennsylvania, wherein the
Leased Premises are located.
50. Raimhurcamant for CrAd;t Rpm Tenant shall reimburse Landlord upon Landlord's request
for reasonable amounts Landlord has paid to obtain credit reports on Tenant and all Guarantors of Tenant's
obligations under this Lease.
51. Irial by l lty Landlord and Tenant each waives any right to trial by jury of any issue(s) in a
summary proceeding or any other suit, action, proceeding or counterclaim at any time brought or instituted by
or against the other with respect to or involving the Leased Premises or any matter arising under or
connected with this Lease and the relationship of Landlord and Tenant created by this Lease.
IN WITNESS WHEREOF each corporate party hereto has caused this Lease to be executed in its name and
behalf by its duty authorized officer or agent; each individual party hereto has hereunto set his hand, and
each partnership party hereto has caused this Lease to be executed in its name and behalf by the required
number of its General Partners.
Landlord: ,dd c i' c
Title: .?l/ ? =-7iu,u
Date: ?J?D)-
Tenant: Z I- L Z O
By: ?'6 rr
Title: ?7?.., y e / ?? Lk f
Date: z-li, /" 6
COMMONWEALTH OF PENNSYLVANIA
COUNTY OFICAM {3B i21 A0 b, to-wit
_h fore-g instrument was acknowled?bqforemeV\htisp, .? 2006, by
My Commission Expires: Z--ll-0
?N
Notary Public
Notarial Seal
Anne Carmody, Notary Public
Mechantsburp Boro, Curnlerland County
my commission Expires Expires Mar. 11, 2006
The following provisions establish the criteria and requirements for Tenant's signage in, upon and
around the Leased Premises and the Building. Included herein are the specifications for design, location,
construdon and installation of all Tenant signage and the procedure for effecting some. Notwithstanding
anything contained herein or elsewhere in the Lease, Tenant shall not construct or erect any signage in the
Leased Premises or the Building without the prior written approval of the Landlord, which approval may be
withheld, delayed or denied in Landlord's sole and absolute discretion. Furthermore, notwithstanding
anything in this Exhibit B or the Lease to the contrary, Landlord reserves the right to modify, supplement or
eliminate all or any portion of the provisions of this Exhibit B from time to time during the term without notice
to Tenant, and any revisions to this Exhibit B shall be applicable to any pending or subsequent request by
Tenant for any signage.
Tenant shall be responsible, at Tenant's sole cost and expense, for the design, construction and
installation of any signage approved by Landlord (in its sole discretion.)
2. DERICN CRITERIA-
a) Tenant shall submit design to Landlord for approval.
3. J,IATERIAI AND CONSTRI ICTION-
a) Composition and Materials - All such figures shall have closed backs and shall be leak
resistant.
b) Electrical - No flashers, moving signs, panels or other elements will be permitted. Design,
fabrication and installation of all electrical work shall be in strict adherence to all applicable governmental
laws, odes or ordinances.
C) Structural Location and Attachment - All sign structures or elements shall consist of rigid
metal framework with stable Interiors to which anchoring bolts, brackets, sleeves or other approved methods
of attachment can be fastened. Structural design, fabrication and installation shall be adequate to withstand
wind and other natural stresses and be sufficient to support the weight of the elements so attached. The sign
and its elements shall have concentric horizontal alignment with Tenant's demised storefront and concentric
vertical alignment with the sign band as specified by Landlord. All letters, numbers, logos, emblems or other
elements shall be individually attached to the building by means of concealed fasteners accomplished so as
to minimize damage to the building and allow for ease of removal; it being understood and agreed that
Tenant shall be responsible for the repair of any damage resulting from the improper installation or removal of
its signage. No raceways shall be permitted. No part of the signage or fasteners shall have corrosive or
stainable materials.
a) Design and Submission - Tenant shall submit two (2) copies of its proposed sign drawings
and specifications to Landlord, and the required number of copies to the governmental authorities having
jurisdiction for approval, K necessary, prior to fabrication and installation. Tenant or its sign contractors shall
secure and pay for all necessary permits and authorizations required by public authorities for the installation
and operation of any Tenant signage. Such drawings and specifications shall clearly indicate all dimensions
and materials to be used including size, copy and color of all letters, numbers, logos and emblems in full
detail. At least one (1) copy of said drawings shall be rendered in colors as close to those proposed to be
used and shall be submitted to Landlord. Landlord thereafter shall respond with any changes required and
Landlord's determination in all signage matters shall be deemed to be conclusive and binding. Any delays or
denials of signage approval shall in no way affect Tenant's obligations under the Lease or any other provision
dealing with Tenant's construction, occupancy or use of the Leased Premises.
b) Contractors - The sign(s) furnished by Tenant shall be fabricated and installed by a licensed
contractor(s) in accordance with the criteria and requirements contained herein and in strict compliance with
all applicable codes, laws, ordinances and/or regulations of any governmental authorities having jurisdiction
thereof. For the purposes of the Lease, signage fabrication and installation shall be deemed an item of
a) Miscellaneous Sign(s) - Tenant shall not affix any signs, advertising placards, names,
insignias, trademarks or other descriptive material(s) (i) upon the glass panes, mullions, supports or doors of
Tenant's demised storefront, (ii) within twelve (17) inches of any show window or front door, or (iii) upon the
exterior walls of the Leased Premises, without the prior written approval of Landlord, which approval may be
withheld, delayed or denied in Landlord's sole discretion. Notwithstanding anything to the contrary in the
Lease, under no circumstances shall any sign be affixed to the roof of the Leased Premises or the Building.
(a) QRSTRIICTION OF PASSAGEWAYS The sidewalks, passages, courts, corridors, and
other public parts of the Building shall not be obstructed or encumbered by Tenant or used by Tenant for any
purpose other than ingress and egress.
(b) WNMW Windows in the Leased Premises shall not be covered or obstructed by
Tenant. No bottles, parcels, or other articles shall be placed on the window sills, in the halls, or in any other
part of the Building. No articles shall be thrown out of the doors or windows of the Leased Premises.
(c) PROJECTIONS FROM R, 111 DING No awnings, air conditioning units, or other fixtures
shall be attached to the outside walls or the window sills of the Building by Tenant or otherwise affixed by it so
as to project from the Building, without the prior written consent of Landlord.
(d) SIGNS No sign or lettering shall be affixed by Tenant to any part of the outside of the
Building, or any part of the inside of the Leased Premises so as to be clearly visible from the outside of the
Building, without prior written consent of Landlord.
(e) FLOOR COVERING -(OMITTED)
(f) INTERFERENCE WITH MCI 1PAN1S OF RI III MNG Tenant shall not ke, or pern'd to be
made, any unseemly or disturbing noises and shall not interfere with other tenants or those having business
with them. Tenant will keep all mechanical apparatus in the Leased Premises free of vibration and noise
which may be transmitted beyond the limits of the Leased Premises.
(g) LOCKS, KFYS No additional locks or bolts of any kind shall be placed on any of the doors
or windows by Tenant. Tenant shall, on the termination of Tenant's tenancy, deliver to Landlord all keys to
any space within the Building, either furnished to or otherwise procured by Tenant, and in the event of the
loss of any keys furnished, Tenant shall pay Landlord the cost thereof. Tenant, before closing and leaving
the Leased Premises, shall ensure that all its windows are closed and its entrance doors locked.
(h) C`. NTRACTORR Landlord shall not be responsible to Tenant for any loss of property from
the Leased Premises however occurring, or for any damage done to the effects of Tenant by janitors or any
of Tenant's employees, or by any other person or any other cause.
(i) PROHIRITEn ON I FA.SFn PRFMISFS, Tenant shall not, without the prior written approval
of Landlord, (i) conduct, or permit any other person to conduct, any auction upon the Leased Premises, (ii)
permit the Leased Premises to be used for gambling or any other illegal activity, (iii) make any unusual noises
in the Building, (iv) permit to be played any musical instrument on the Leased Premises, (v) permit to be
played any radio, television, recorded or wired music in such a loud manner as to disturb or annoy other
tenants, or (vi) permit any unusual odors to be produced upon the Leased Premises. Canvassing, soliciting
and peddling in the Building are prohibited, and Tenant shall cooperate to prevent the same. No bicycles,
vehicles or animals of any kind shall be brought into or kept in or about the Leased Premises or the Building,
except that vehicles may be parked in the parking spaces provided in the Common Areas and in accordance
with such other rules with respect to vehicles and parking as may be established from time to time by
Landlord.
0) 21 1 IMRINO FI FCTRIC AND TFI FPHONF WORK Plumbing facilities shall not be used
for any purpose other than those for which they were constructed; and no sweepings, rubbish, ashes,
newspaper or other substances of any kind shall be thrown into them. Waste and excessive or unusual
usage of electricity or water is prohibited. When electric wiring of any kind is introduced, it must be
connected as directed by Landlord, and no stringing or cutting of wires will be allowed, except by prior written
consent of Landlord, and shall be done by contractors approved by Landlord.
(k) SAFES AND OTHER HEAVY FQI IIPMFNT Landlord reserves the right to prescribe the
weight and position of all safes and other heavy equipment so as to distribute properly the weight thereof and
to prevent any unsafe condition from arising.
(I) NCMrF OF ACC`Ir1FNTS Tenant shall give Landlord prompt written notice of any accident
or damage occurring on or to the Leased Premises or the Common Areas adjacent to the Leased Premises.
FXHIBII D
BI 111 11-01 IT RIDER
WORK AGREEMENT
TFNANr-S PERFORMANCE
THIS AGREEMENT made as of the day of 2005, between
("Landlord") and
a
('Tenant"). The parties hereby acknowledge that they have heretofore entered, or are contemporaneously
herewith entering, a certain Lease agreement dated , 2005 (the "Lease") for
premises (the "Leased Premises") known as located in the property known as
(the "Property").
1. Thp Whrk Under the Lease, Tenant has agreed to accept the Leased Premises "as is",
without any obligations for the performance of improvements or other work by Landlord, and Tenant desires
to perform certain improvements thereto (the "Work"). Such Work shall be in accordance with the provisions
of this Work Agreement, and to the extent not expressly inconsistent herewith, in accordance with the
provisions of the Lease. Performance of the Work shall not serve to abate or extend the time for the
commencement of Rent under the Lease, except to the extent Landlord delays approvals beyond the times
permitted below.
2. Cost of the Z+*k Except as provided hereinafter, Tenant shall pay all costs (the "Costs of
the Work") associated with the Work whatsoever, including without limitation, all permits, inspection fees, fees
of space planners, architects, engineers, and contractors, utility connections, the cost of all labor and
materials, bonds, insurance, and any structural or mechanical work, all HVAC equipment or sprinkler heads,
or modifications to any building mechanical, electrical, plumbing or other systems and equipment or
relocation of any existing sprinkler heads, either within or outside the Leased Premises required as a result of
the layout, design or construction of the Work.
Of the Costs of the Wdrk, Landlord shall reimburse Tenant the amount of $ (the
"Improvement Allowance"). The Improvement Allowance shall be funded by Landlord within thirty (30) days
after the Work has been completed in accordance with the "Space Plan" and "Working Drawings" approved
by Landlord in writing in accordance with the provisions hereof, and Tenant has submitted all invoices, lien
waivers, affidavits of payment, and such other evidence as Landlord may reasonably require that the cost of
the Work has been paid for and that no mechanic's, materialmen's, or other such liens have been or may be
filed against the Property or the Leased Premises arising out of the design or performance of the Work. In
the altemative, at Landlord's sole option, Landlord may elect to fund the Improvement Allowance in
installments, not more frequently than monthly, based on applications for payment and releases of lien rights,
submitted by Tenant on Landlord's standard form for use by contractors requesting progress payments,
together with such lien releases and affidavits of payments by Tenant's general contractor and
subcontractors contemplated therein, and such other documentation as Landlord may reasonably require.
Landlord may issue checks to fund the Improvement Allowance jointly to Tenant, its general contractor, and,
at Landlord's option, to any subcontractors or suppliers.
a. No later than ten (10) days after the date of this Work Agreement set forth above,
Tenant shall submit two (2) sets of a "Space Plan" (as described in Section 16 below) to Landlord for
approval.
b. Landlord shall, within ten (10) days after receipt thereof, either approve said Space
Plan, or disapprove the same advising Tenant of the reasons for such disapproval. In the event Landlord
disapproves said Space Plan, Tenant shall modify the same, taking into account the reasons given by
Landlord for said disapproval, and shall submit two (2) sets of the revised Space Plan to Landlord within five
(5) days after receipt of Landlord's initial disapproval.
a. No later than twenty (20) days after receipt of Landlord's approval of the Space
Plan, Tenant shall submit to Landlord for approval two (2) sets of "Working Drawings" (as defined in Section
16 below), and a report (the "Engineering Report") from Tenant's mechanical, structural and electrical
engineers indicating any special heating, cooling, ventilation, electrical, heavy load or other special or unusual
requirements of Tenant.
and submit revised Working Drawings, and a revised Engineering Report, taking into account the reasons
given by Landlord for disapproval, within five (5) days after receipt of Landlord's initial disapproval.
5. i andlnrd'e ApproY?i_ Landlord shall not unreasonably withhold approval of any Space
Plans, Working Drawings, or Engineering Report submitted hereunder if they provide for a customary
with finishes and materials generally conforming to building standard finishes and
materials currently being used by Landlord at the Property, are compatible with the Property's exterior
construction, and if no modifications will be required for the Property's electrical, heating, air conditioning,
ventilation, plumbing, fire protection, life safety, or other systems or equipment, and will not require any
structural modifications to the Property whether required by heavy loads or otherwise.
6. Space PJannem. ArrhitAts, Engineers and Contrantnrs, The Space Plan, Working
Drawings, Engineering Report and the Work, shall be prepared and performed by such space planners,
architects, engineers and contractors as Landlord customarily engages or recommends for use at the
Property; provided, Tenant may substitute another licensed, bonded, reputable and qualified space planner,
architect, engineer or contractor, who will work in harmony with each other and those of Landlord so as to
ensure proper maintenance of good labor relationships. Such substitutions may be made only with
Landlord's prior written approval. Such approval shall be granted or denied within ten (10) days after
Landlord receives from Tenant a written request for such substitution, containing a reasonable designation of
the proposed party's background, references and qualifications. Any such substitution shall not serve to
delay the times for submission of the Space Plan, Working Drawings and Engineering Report required
herein, except to the extent that Landlord delays granting or denying approval beyond the aforementioned
ten (10) day period.
7, Change No changes, modifications, alterations or additions to the approved Space
Plan or Working Drawings may be made without the prior written consent of the Landlord after written request
therefor by Tenant. In the event that the Leased Premises are not constructed in accordance with said
approved Space Plan and Working Drawings, then Tenant shall not be permitted to occupy the Leased
Premises until the Leased Premises reasonably comply in all aspects with said approved Space Plan and
Working. Drawings; in such case, the Rent shall nevertheless commence to accrue and be payable as
otherwise provided in the Lease.
8. Cnn+n? iT. Tenant's Work shall comply in all respects with the following: (a) the Building
Code of the City and State in which the Building is located and State, County, City or other laws, codes,
ordinances and regulations, as each may apply according to the rulings of the controlling public official, agent
or other such persons, (b) applicable standards of the National Board of Fire Underwriters and National
Electrical Code, and (c) building material manufacturers specifications.
9. Giarant- Each contractor, subcontractor and supplier participating in Tenant's Work
shall guarantee that the portion thereof for which he is responsible shall be free from any defects in
workmanship and materials for a period of not less than one (1) year from the date of completion thereof,
Every such contractor, subcontractor, and supplier shall be responsible for the replacement or repair, without
additional charge, of all work done or furnished in accordance with its contract which shall become defective
within one (1) year after completion thereof. The correction of such work shall include, without additional
charge, all additional expenses and damages in connection with such removal or replacement of all or any
part of Tenant's Work, and/or the Property and/or Common Areas, or work which may be damaged or
disturbed thereby. All such warranties or guarantees as to materials or workmanship of or with respect to
Tenant's Work shall be contained in the contract or subcontract which shall be written such that said
warranties or guarantees shall inure to the benefit of both Landlord and Tenant, as their respective interests
may appear, and can be directly enforced by either. Tenant covenants to give Landlord any assignment or
other assurances necessary to effect such right of direct enforcement Copies of all contracts and
subcontracts shall be furnished to Landlord promptly after the same are entered.
10. Performance-
a. Tenant's Work shall be commenced within fifteen (15) days after Landlord approves
the Working Drawings, and shall thereafter be diligently prosecuted to completion, subject to delays for
reasons beyond Tenant's control (except financial matters). All Work shall conform with the Working
Drawings approved by Landlord in writing, and Landlord may periodically inspect the Work for such
compliance. Tenant's Work shall be coordinated under Landlord's direction with the work being done or to be
performed for or by other tenants In the Property so that Tenant's Work will not interfere with or delay the
completion of any other construction work in the Property.
TPnanPQ Wnrk ehall ha narfnr aA in a thnrrn,nhh, -fn firot .,L,........ 1 ... .b ia.
C. Tenant shall be required to obtain and pay for all necessary permits and/or fees with
respect to Tenant's Work, and the same shall be shown to Landlord prior to commencement of the Work.
d. Each contractor and subcontractor shall be required to obtain prior written approval
from Landlord for any space outside the Leased Premises within the Property, which such contractor or
subcontractor desires to use for storage, handling, and moving of his materials and equipment, as well as for
the location of any facilities for his personnel.
e. The contractors and subcontractors shall be required to remove from the Leased
Premises and dispose of, at least once a week and more frequently as Landlord may direct, all debris and
rubbish caused by or resulting from the construction. Upon completion of Tenant's Work, the contractors and
subcontractors shall remove all surplus materials, debris and rubbish of whatever kind remaining within the
Property which has been brought in or created by the contractors and subcontractors in the performance of
Tenants Work. If any contractor or subcontractor shall neglect, refuse or fail to remove any such debris,
rubbish, surplus material or temporary structures within two (2) days after notice to Tenant from landlord with
respect thereto, Landlord may cause the same to be removed by contract or otherwise as Landlord may
determine expedient, and charge the cost thereof to Tenant as Additional Rent under the Lease.
f. Tenant shall obtain and fumish Landlord all approvals with respect to electrical,
water and telephone work as may be required by the respective company supplying the service. Tenant
shall obtain utility service, including meter from the utility company supplying service, unless Landlord elects
to supply service and/or meters.
g. Landlord shall have the right to require Tenant to furnish bonds or other security in
form and amount reasonably satisfactory to Landlord for the prompt and faithful performance and payment
for Tenant's Work.
h. Landlord's acceptance of Tenant's Work as being complete in accordance with the
approved Space Plan and Working Drawings shall be subject to Landlord's inspection and written approval.
Tenant shall give Landlord five (5) days prior written notification of the anticipated completion date of Tenant's
Work.
i. If contemplated or permitted under the statutes of the State in which the Property is
located, within ten (10) days after completion of construction of Tenant's Work, Tenant shall execute and file
a Notice of Completion with respect thereto.
j. Tenant shall, at its cost and expense construct, purchase, install and perform any
and all items of Tenant's Work, stock its merchandise, and employ its personnel so as to obtain any
governmentally required certificate of occupancy and to occupy the Leased Premises as soon as possible,
and in all cases on or before the date required therefor hereunder or under the Lease.
k. If an expansion joint occurs within the Leased Premises, Tenant shall install finish
floor covering to or covering such joint in a workmanlike manner, and Landlord shall not accept responsibility
for any finish floor covering applied to or installed over the expansion joint.
1. Copies of "as built' drawings shall be provided to Landlord no later than thirty (30)
days after completion of the Work.
M. Landlord's approval of Tenant's plans and specifications, and Landlord's
recommendations or approvals concerning contractors, subcontractors, space planners, engineers or
architects, shall not be deemed a warranty as to the quality or adequacy of the Work, or the design thereof,
or of its compliance with laws, codes and other legal requirements.
n. Tenant shall conduct its labor relations with employees so as to avoid strikes,
picketing, and boycotts of, on or about the Leased Premises or Property. If any employees strike, or if picket
lines or boycotts or other visible activities objectionable to Landlord are established, conducted or carried out
against Tenant, its employees, agents, contractors, subcontractors or suppliers, in or about the Leased
Premises or Property, Tenant shall immediately close the Leased Premises and remove or cause to be
removed all such employees, agents, contractors, subcontractors and suppliers, in or about the Leased
Premises or Property, Tenant shall immediately close the Leased Premises and remove or cause to be
removed all such employees, agents, contractors, subcontractors and suppliers until the dispute has been
settled.
0 1 andlnrt Chall nest ho rpennncihla fnr omr rlich irhonra nr riafirianru rmofarf in tha oir
P. If performance of the Work shall require that additional services or facilities be
provided, Tenant shall pay Landlord's reasonable charges therefor.
q. Tenant's contractors shall comply with the rules of the Property and Landlord's
requirements respecting the manner of handling materials, equipment and debris. Demolition must be
performed at such times as Landlord determines in its sole judgment as least disruptive to the Building
tenants. Delivery of materials, equipment and removal of debris must be arranged to avoid any
inconvenience or annoyance to other tenants. The Work and all cleaning in the Leased Premises must be
controlled to prevent dirt, dust or other matter from infiltrating into adjacent tenant or mechanical areas or the
parking lots.
r. Landlord may impose reasonable additional requirements from time to time in order
to ensure that the Work, and the construction thereof does not disturb or interfere with any other tenants of
the Property, or their visitors, contractors or agents, nor interfere with the efficient, safe and secure operation
of the Property.
11. lnglir-mce- All contractors and subcontractors shall carry Worker's Compensation Insurance
covering all of their respective employees in the statutory amounts, Employer's Liability Insurance in the
amount of at least $500,000 per occurrence, and comprehensive general liability insurance of at least
$3,000,000 combined single limit for bodily injury, death, or property damage; and the policies therefor shall
cover Landlord, Tenant, as additional insureds, as well as the contractor or subcontractor. Tenant shall carry
builder's risk insurance coverage respecting the construction and improvements to be made by Tenant, in the
amount of the anticipated cost of construction of the Work (or any guaranteed maximum price). All insurance
carriers hereunder shall be rated at least A and X in Best's Insurance Guide. Certificates for all such
insurance shall be delivered to Landlord before the construction is commenced or contractor's equipment is
moved onto the Property. All policies of insurance must require that the carrier give Landlord twenty (20)
day's advance written notice of any cancellation or reduction in the amounts of insurance. In the event that
during the course of Tenants Work any damage shall occur to the construction and improvements being
made by Tenant, then Tenant shall repair the same at Tenants cost.
12. Signage The content of all signage shall be subject to Landlord's prior written approval. No
other signage may be installed or placed outside the Leased Premises by Tenant unless installed in
accordance with the Landlord's signage criteria.
13. Asbestos If the Property was constructed at a time when asbestos was commonly used in
construction, Tenant acknowledges that asbestos-containing materials ("ACM") may be present at the
Property, and that airborne asbestos fibers may involve a potential health hazard unless proper procedures
are followed. In such case, before commencing the Work, Tenant and its contractor shall consult with
Landlord and Landlord's asbestos consultant concerning appropriate procedures to be followed. Landlord
shall, at Tenants expense, undertake any necessary initial asbestos-related work, before Tenant
commences the work. During performance of the Work, Tenant shalt require that its contractor comply with
all laws, rules, regulations and other governmental requirements, as well as all directives of Landlord's
asbestos consultant, respecting ACM. Tenant hereby irrevocably appoints Landlord and Landlord's asbestos
consultant as Tenants attomey-rn-ter for purposes of supervising and directing any asbestos-related
aspects of the Work (but such appointment shall not relieve Tenant from its obligations hereunder, nor
impose any affirmative requirement on Landlord to provide such supervision or direction).
14, Liens; Tenant shall keep the Property and the Leased Premises free from any mechanic's,
materialman's or similar liens or other such encumbrances in connection with the Work, and shall indemnify
and hold Landlord harmless from and against any claims, liabilities, judgments, or costs (including attorneys'
fees) arising in connection therewith. Tenant shall give Landlord notice at least twenty (20) days prior to the
commencement of the Work (or such additional time as may be necessary under applicable laws), to afford
Landlord the opportunity of posting and recording appropriate notices of non-responsibility. Tenant shall
remove any such lien or encumbrance by bond or otherwise within thirty (30) days after written notice by
Landlord, and if Tenant shall fail to do so, Landlord may pay the amount necessary to remove such lien or
encumbrance, without being responsible for investigating the validity thereof. The amount paid shall be
deemed Additional Rent under the Lease payable upon demand, without limitation as tb other remedies
available to Landlord under the Lease. Nothing contained herein shall authorize Tenant to do any act which
shall subject Landlord's title to the Property or Leased Premises to any liens or encumbrances whether
claimed by operation of law or express or implied contract. Any claim to a lien or encumbrance upon the
Property or Leased Premises arising in connection with the Work shall be null and void, or at Landlord's
option shall attach only against Tenants interest in the Leased Premises and shall in all respects be
subordinate to Landlord's title to the Property and Leased Premises.
Work, or Tenant's failure to comply with the provisions hereof, or any failure by Tenants contractors,
subcontractors or their employees to comply with the provisions hereof, except to the extent caused by
Landlord's intentional or negligent acts.
16. Certain r)efin*Hnns-
a. "Space Plan" herein means a layout plan, drawn to scale, showing (1) demising
walls, interior partition walls and interior doors, including any special walls, glass partitions or special features,
(2) any restrooms, kitchens, computer rooms, and other special purpose rooms, and any sinks or other
plumbing facilities, or other special facilities or equipment, (3) any communications system, indicating
telephone and computer outlet locations, and (4) any other details or features required to reasonably
delineate the Work to be performed.
b. 'Working Drawings" herein means fully dimensioned architectural construction
drawings and specifications, and any required engineering drawings (including mechanical, electrical,
plumbing, air-conditioning, ventilation and heating) and shall include any applicable items described above for
the Space Plan, and if applicable: (1) electrical outlet locations, circuits and anticipated usage therefor, (2)
reflected oiling plan, including lighting, switching, and any special ceiling specifications, (3) duct locations for
heating, ventilating and air-conditioning equipment, (4) details of all millwork, (5) dimensions of all equipment
and cabinets to be built in (6) furniture plan showing details for space occupancy, (7) keying schedule, (8)
lighting arrangement, (9) location of any major equipment or systems (with brand names wherever possible)
which require special consideration relative to air-conditioning, ventilation, electrical, plumbing, structural, fire
protection, life-fire-safety system, or mechanical systems, (10) special heating, ventilating and air conditioning
equipment and requirements, (11) weight and location of heavy equipment, and anticipated loads for special
usage rooms, (12) demolition plan, (13) partition construction plan, (14) type and color of floor and wall-
coverings, wall paint and any other finishes, and any other details or features required to completely delineate
the Work to be performed and (15) a site plan, if applicable, including landscaping, and exterior signage.
17. Taxes: Tenant shall pay prior to delinquency all taxes, charges or other governmental
impositions (including without limitation, any real estate taxes or assessments, sales tax or value added tax)
assessed against or levied upon Tenants fixtures, furnishings, equipment and personal property located in
the Leased Premises and the Work to the Leased Premises under this Agreement. Whenever possible,
Tenant shall cause all such items to be assessed and billed separately from the property of Landlord. In the
event any such items shall be assessed and billed with the property of Landlord, Tenant shall pay its share of
such taxes, charges or other governmental impositions to Landlord within thirty (30) days after Landlord
delivers a statement and a copy of the assessment or other documentation showing the amount of such
impositions applicable to Tenant.
18. INCORPORATED INTO LEASE; DEFAULT. THE PARTIES AGREE THAT THE
PROVISIONS OF THIS WORK AGREEMENT ARE HEREBY INCORPORATED BY THIS REFERENCE
INTO THE LEASE FULLY AS THOUGH SET FORTH THEREIN. In the event of any express
inconsistencies between the Lease and this Work Agreement, the fatter shall govern and control. If Tenant
shall default under this Work Agreement, Landlord may order that all Work being performed in the Leased
Premises be stopped immediately, and that no further deliveries to the Leased Premises be made, until such
default is cured, without limitation as to Landlord's other remedies. Any amounts payable by Tenant to
Landlord hereunder shall be paid as Additional Rent under the Lease. Any default by the other party
hereunder shall constitute a default under the Lease and shall be subject to the remedies and other
provisions applicable thereto under the Lease. It Tenant shall default under the Lease or this Work
Agreement and fail to cure the same within the time permitted for cure under the Lease, at Landlord's option,
all amounts paid or incurred by Landlord towards the improvement Allowance shall become immediately due
and payable as Additional Rent under the Lease.
LANDLORD:
By: Date:
Title:
TENANT:
EXHIBIT E
GUARANTY
THIS GUARANTY ("Guaranty") is made this _&9 day of 2006, by and between
Kenneth R. Paton and W. Douglas Waardenburg (Individually Guaranto Pand collectively "Guarantors") and
Alpha Omega Limited, LLG ("Landlord"), with respect to certain present and future obligations of Zur, LTD
('Tenant').
WHEREAS, Tenant wishes to enter into a Building Lease (the "Lease") between Tenant and
Landlord (all obligations of Tenant under the Lease, whether now existing or hereafter incurred, whether
direct, indirect, contingent or fixed, whether incurred as primary obligor, co-maker, endorser, or guarantor,
whether otherwise guaranteed or secured, and whether on open account, evidenced by a written instrument
or otherwise, are collectvely referred to as the "Obligations"); and
WHEREAS, Landlord has required additional assurances of Tenants performance of the Obligations
as a condition of entering into the Lease.
NOW, THEREFORE, in consideration of good and valuable consideration and in order to induce
Landlord to enter into the Lease, the parties agree as follows:
1. Guaranty_ Each of the Guarantors jointly and severally guarantee to Landlord the prompt
performance when due of the Obligations, including without limitation payment of all sums due under the
Lease, plus any interest, penalties, and collection fees thereon. Each of the Guarantors agrees to make
such payments to Landlord and perform any non-monetary Obligations, if there is any default in the payment
or the performance of the Obligations.
2. Naft ire of Giiaranbf This is a continuing, unconditional Guaranty and the liability of each of
the Guarantors to Landlord is not limited to a proportionate part of the total liability of the Tenant to Landlord.
This is a guaranty of payment and not of collection, and each of the Guarantors waives any right to require
that any action be brought against the Tenant, or any other Guarantor, or to require that Landlord proceed
against any security, or any other person, and agrees that Landlord assumes no responsibility for the validity
or enforceability of any security for the Obligations.
3. cuhn- As a material inducement for Landlord to accept this Guaranty and enter into
the Lease, the Guarantors represent and warrant that they have no right of indemnification from or against
Tenant, any such right being waived. In lieu of any other remedy the Guarantors may have against Tenant,
the Guarantors shall be subrogated to the rights of Landlord against Tenant; provided that none of the
Guarantors shall be subrogated to, or may enforce on the part or behalf of any of the Guarantors, any right of
action which Landlord may have against the Tenant until the Obligations shall have been paid in full.
4. Gnnriifinnc Precedent, Each of the Guarantors represents and warrants that his liability
under this Guaranty is not contingent or conditional upon any other person signing this Guaranty or the
obtaining or perfecting of any security for the Obligations, or any other condition precedent or subsequent.
5, Changes Affirm the Dominations, Landlord may, from time to time, either before or after
the death of any of the Guarantors, or any default by the Tenant, with or without further notice to any of the
Guarantors, renew or extend the time of payment of the Obligations, and grant and allow such indulgences,
modifications, or compromises in connection therewith as it deems advisable or expedient, and may change,
renew, extend, surrender, impair, or compromise, in whole or in part, any security at any time held by or
available to Landlord for the Obligations or for any obligation of any other person secondarily or otherwise
liable on the Obligations, intentionally or unintentionally, or may waive, release, extend, or modify the rights of
any of the Guarantors, without impairing the enforceability of this Guaranty. The death, disability, or
discharge in bankruptcy of the Tenant or any of the Guarantors shall not affect the liability of any remaining
Guarantors.
6. Coe+e of Cnikrt-n• Each of the Guarantors shall, upon demand, pay all costs and
expenses incurred by Landlord in connection with the enforcement or collection of the Obligations or the
enforcement of this Guaranty, including attorneys' fees and disbursements. In determining attomeys' fees,
the parties deem the following to be reasonable: the greater of either (a) twenty-five percent ( 15%) of the
amount due at the time payment is made, including all past due interest, costs, and fees, or (b) $1,500 in fees
if the matter is litinaterl hpfnrP a niRfrinf .I[lgflr'A or V; nM In face if the maffar is lifinefaA in Oho rn-f of
respect to any amounts that Landlord may ever be required to repay under any bankruptcy or insolvency
laws.
8, wabiem of Homestead W kw Each of the Guarantors hereby waives the benefit of any
homestead exemption and notice of acceptance of and demand for payment as to this Guaranty and also
waives notice of any default in the Obligations or of action taken in connection therewith. To the extent any
notice may not be legally waived, each Guarantor appoints the Tenant his or her attomey-in-fact for the
delivery of any notice, and any notice delivered to the Tenant shall be deemed received by each of the
Guarantors.
g, Delays WaiyAM by i andinrd• No delay on the part of Landlord in exercising any rights
hereunder or under the Lease or any failure to exercise the same shall operate as a wavier of such rights; no
notice to or demand on the Guarantors shall be deemed to be a waiver of the obligations of the Guarantors or
of the right of Landlord to take further action without notice or demand as provided herein.
10. Mod05catino,WatvP? of this Guaran4 No modification or waiver of the provisions of this
Guaranty, including the provisions of this paragraph, shall be effective unless in writing and signed by
Landlord; nor shall any waiver be applicable except in the specific instance for which it is given.
11. SmMes of infnm wtinrr The Guarantors warrant that they have adequate means to obtain
from the Tenant, now and on a continuing basis, all necessary and desirable information concerning the
status of the Obligations and the financial condition of the Tenant, and they are not relying on the Landlord to
provide such information, either now or in the future.
12. Finarydar rnfnrmati= Upon Landlord's reasonable requests from time to time, each of the
Guarantors shall provide Landlord with financial information covering such periods and in such form as is
satisfactory to Landlord.
13. Nfntificatiions to i ease- Landlord may make such modifications and additions to the Lease
and the Obligations as Landlord may deem advisable, including without limitation, extending the term of the
Lease, increasing or decreasing payments under the Lease, or allowing Tenant to assign or delegate its
duties under the Lease, and the same shall not release any Guarantor or in any way limit the liability of any
Guarantor, this Guaranty expressly extending to such modifications and extensions.
14. Notices Any notice or other communication required or permitted by this Guaranty shall be
in writing and shall be deemed given when hand delivered or deposited in the United States mail, postage
prepaid, via first class or certified mail, and addressed to the parties as follows:
If to Landlord: Alpha Omega, LLC
P. O. Box 3555
Camp Hill, PA 17011
With a copy to: Attorney Mark Thomas.
101 South Market Street
Mechanicsburg, PA 17055
If to Guarantor(s): Kenneth R. Paton
68 Round Ridge Road
Mechanissburg, PA 17055
W. Douglas Weardenburg
2230 Canterbury Drive,
Mechanicsburg, PA 17055
With a copy to: Ralph H. Wright, Jr.
Johnson, Duffle, Stewart & Weidner
P 0 Rnv 1 no
15. Fnfirp reem ne t- This Guaranty constitutes the entire agreement between the parties with
respect to the subject matter of this Guaranty and supersedes and merges all prior negotiations, offers,
representations, warranties, and agreements with respect to the subject matter of this Guaranty. No course
of prior dealing between the parties, no usage of trade, and no parol, extrinsic, or other outside evidence of
any nature shall be used to supplement, interpret, or modify any of the terms of this Guaranty.
16. Sp ramify- If any provision of this Guaranty is unenforceable, the remainder of this
Guaranty shall continue in effect and be construed as if the unenforceable provision had not been contained
in this Guaranty. Each provision of this Guaranty shall be valid and enforceable to the fullest extent permitted
by law.
17. Succemm and Assigns- This Guaranty shall be binding upon and inure to the benefit of
the parties and their respective heirs, personal representatives, successors, and assigns.
18. Venue. Regardless of what venue would otherwise be permissive or required, the parties
stipulate that all actions arising under or affecting this Guaranty shall be brought in the C-urt_of Cn-r-n
Pleas of raimMdand rnunty,ponnay •nnia, the parties agreeing that such forum is mutually convenient and
bears a reasonable relationship to this Guaranty.
19. r:nnSent to _hidSdic i.n and S-9ce of Proces& The parties irrevocably submit to the
jurisdiction of the state courts of the Commonwealth of Pennsylvania and to the jurisdiction of the United
States District Court for the Middle-Dist?inf of Ppnnevlvania for the purpose of any suit, action, or other
proceeding arising under or affecting this Guaranty.
20. Number and Gender When used in this Guaranty, the singular includes the plural, the
plural includes the singular, and the use of any gender includes any other gender, as circumstances may
require. The term "person" includes both natural persons and entities.
21. Headings The headings contained in this Guaranty are for the convenience of the parties
only, and are not a part of the substantive agreement of the parties nor shall they affect the meaning or
interpretation of any provision of this Guaranty in any way.
22. rnlinf_ marts- This Guaranty may be executed in multiple counterparts. When at least one
copy of this Guaranty has been executed by each part of this Guaranty, this Guaranty shall be in full force
and effect, and all of such counterparts shall be read together as a single agreement.
23. Adviap fmm independent rnuncpi• The parties understand that this is a legally binding
contract that may affect their rights. Each party represents that he has entered into this Guaranty freely and
voluntarily and without coercion of any kind whatsoever, and has had the opportunity to consult with
independent counsel.
24. GOVERNING I Aw• ALL MATTERS REGARDING THE FORMATION,
INTERPRETATION, AND ENFORCEMENT OF THIS GUARANTY SHALL BE GOVERNED BY
PFNNSYI VANIA LAW, EXCLUDING ITS LAWS RELATING TO CHOICE OF LAW.
IN WITNESS WHEREOF, the Guarantors have executed this Guaranty as of the day and year first
above written.
INDIVIDUAL GUARANTORS (If applicable):
Kenneth R. 15aton
W. Dougl Waardenb
EXHIBIT
8
LEASE AGREEMENT for Space at 3825 Hartzdale Drive, Camp Hill, PA 17011
THIS LEASE AGREEMENT ("Lease") is made this _ day of February, 2006, between
Landlord: Alpha Omega Unlimited, LLC with contact address as 49 Tannery Road, Dillsburg, PA 17019
Tenant: Zur LTD, with contact address as 2230 Canterbury Drive, Mechanicsburg, PA, 17055.
WITNFSSFTH:
1. Definitions. The following definitions shall apply to the indicated terms, whenever used in
this Lease. Additional defined terms may be found in the body of the Lease.
(a) Landlord: AlphaQmega Unlimited LLC
p/n rnade?nd Vlrki FJChtner
dQ Tanner Road
?lugb?g ag ??n?o
(b) Tenant: 71 IR I TD
2230 Canterbury Drive
Mechanicsburg, PA 17055
(c) Leased Premises: Approx 5,160 square feet
(d) Permitted Use: Office
(e) Lease Commencement Date: 31112006
All prorate CAM, Taxes and Insurance charges are due beginning on the lease commencement date.
(f) Rent Commencement Date: 2/10/2006
(9) Term: 3 years 0 months
(h) Minimum Rent: $5,000 per month with no increase for the term of the lease.
(i) None, unless otherwise mutually agreed.
See Option Rider, if applicable. All Renewal Periods shall be included in the definition of the Tenn.
(j) Percentage of Common Area Charge ("CAM"): 10.5%
Initial Annual Amount ($12,000.00) ' $1260/year
(k) Percentage of Capital Improvements Fund 10.5% '
Initial Annual Amount ($12,860.00) $?,3,12Z*ear "
?v j1-Co.o? .T 7\ ,
(I) Security Deposit ??J??v'_ vJ ?p?•/il\[7Y?'Ju
(m) Insurance Payment ("Ins."): 10.5%
Initial Annual Amount ($5,000.00) $525/year
(n) Tax Payment ('Tax"): 10.5%
Initial Annual Amount ($40,00000 $4200/year
! jf Lms (,I'ni?'rQ AnnbwlAn;tj ,a ,,eb /o. sJp 7?3?t?gi.
(o) Ivvaa To Landlortldd: Alpha Omega
P. O. Box 3555 V' IVVVttt???
AIM Camp Hill, PA 17011
With a copy to: Attorney Mark Thomas
101 South Market Street
Mechanicsburg, PA 17055
To Tenant: a
C>? ?? ?rY
Landlord's Initials: Tenant's Initials: ?
za r 4 d.
2230 Canterbury Drive,,,
Page
ti
Mechanicsburg, PA.
17055
With a copy to: Ralph H. Wright, Jr.
Johnson, Duffle, Stewart 8
Weidner
P.O. Box 109
Lemoyne, PA 17043-0109
?q) ( Attachments: Exhibit A - Floor Plan
YY Exhibit 8 - Signage Criteria
Exhibit C - Rules and Regulations
Exhibit D - Deilvery of Documents
Exhibit E - Build Out Rider
Exhibit F - Guaranty
Descdption of Premises Landlord leases to Tenant, and Tenant leases from Landlord, the
Leased Premises described in Section 1. The Leased Premises is outlined in red on a diagram of the
Building attached hereto and incorporated herein as Exhibit "A." Exhibit "A" sets forth the general layout of
the Building and shall not be deemed a warranty on the part of Landlord that the Building is or will be exactly
as indicated on such diagram. Landlord may increase, reduce, or change the number, dimensions, and
locations of roadways, walks, buildings, and parking areas as Landlord from time to time deems proper.
Tenants occupancy of the Leased Premises shall include the use in common with others entitled thereto of
such parking areas, service roads, sidewalks, signs, equipment facilities, service areas, hallways, doors,
stairwells, and the like (the "Common Areas") as Landlord may from time to time, make available to Tenant
for use in common with others, subject, however, to the terms and conditions of this Lease and to all rules
and regulations for the use thereof as may from time to time be prescribed by Landlord.
3. Ilse nf I PaSed_Psemises; Nam, The Leased Premises shall be used solely for the
Permitted Use indicated in Section 1, and for no other purpose. Tenant shall operate such a business in the
Leased Premises at all times during the Tenn. Tenant shall conduct its business in the Leased Premises
under its Legal name or the Trade Name indicated in Section 1. Tenant shall not change its Trade Name or
Legal name without prior notice to Landlord.
4. Te=. The Initial Term of this Lease shall begin on the "Lease Commencement Date" , so
set forth on page 1 of this Lease unless otherwise stated here. The phrase "Term" as used in this Lease
shall mean the Initial Term and all renewal terms (if there are any) exercised.
Bent.
(a) Minimum Rant. Tenant shall pay, as rent for the Leased Premises, the Minimum Rent
indicated in Section 1. If the Commencement Date is not the first day of the month, rent for that month shall
be prorated. If any rent or other sum is not received by Landlord within ten (10) calendar days after its due
date, Tenant shag pay a late charge of ten percent (10%) of the overdue amount. If any payment under this
Lease is made by check and such check is returned by the payor for any reason, Tenant shag pay a returned
check charge of One Hundred Dollars ($100.00). In addition, any rent or other sum not received by Landlord
when due shall bear interest from the due date to the payment date at the prime rate published from time to
time by the Wall Street Journal, plus two (2%). Landlord reserves the right to require cashier's check,
certified check, money order, or cash, and may refuse Tenant's check in Landlord's sole discretion.
(b) Comm r- rhare . Tenant shall pay as Additional Rent its pro-rata share of the cost of
operating, replacing improving, maintaining, repairing, and refurbishing the Common Areas ("Common Area
Charge"), which for purposes of this Section only, shall include all roofs of the Building. Such costs shall
include, without limitation, materials, supplies, equipment, and services purchased or hired; equipment used
for the maintenance of the Common Areas; landscaping, gardening, planting, cleaning, painting, striping
parking areas, repaving, lighting, and sanitation; removing snow, ice, and garbage; heating, ventilating, and
arc-conditioning the enclosed areas other than the Leased Premises; fire protection and on-site security If
provided by Landlord in its sole discredon), water and sewage charges, storm water maintenance fees,
electricity and other utility services; costs of personnel, payments to governmental authorities, costs of
complying with rules and regulations of governmental authorities, Fire Insurance Rating Organizations, Board
of Fire Underwriters, insurance carriers, and other organizations having jurisdiction over the Building; and
Landlord's administretive s (including any management fee payabl Landlord) in connection with the
Landlord's Initials Tenant's Initials: Page
e
operation of the Building ("Common Area Costs"). Landlord and Tenant agree that improvements performed
to the front of the Building primarily for the benefit of the retail sore currently known as Servant's Heart shall
be excluded for purposes of computing the Common Area Charge.
Tenant's prorate share of the Common Area Charge shall be paid by Tenant in monthly installments
in such amounts as are estimated and billed by Landlord at the beginning of each twelve (12) month period
commencing and ending on dates designated by Landlord, each installment being due on the first day of
each calendar month. At any time during any such twelve (12) month period, Landlord may re-estimate
Tenant's proportionate share of the Common Area Charges and thereafter adjust Tenant's monthly
installments payable during such twelve (12) month period to reflect more accurately Tenant's proportionate
share of the Common Area Charges. At the end of each twelve (12) month period, Landlord shall deliver to
Tenant a statement of the actual Common Area Charges for that twelve (12) month period. For the next
twelve (12) months, the monthly Common Area Charges will be adjusted to reflect the actual Common Area
Charges for the preceding twelve (12) months, plus the deficiency in Common Area Charges for the
preceding twelve (12) months based upon Tenant's proportionate share of that deficiency. Tenant shall have
the option to pay its entire proportionate deficiency within thirty (30) days should Tenant so choose. At the
end of the initial term, or any renewal thereof, Tenant will pay its proportionate share of any deficiency within
twenty (20) days following receipt of notice from Landlord of the Tenant's proportionate share. If , at the end
of any twelve month period, Tenant has paid more than Tenants proportionate share of the actual Common
Area Charges for such period, such overage shall be credited as a payment toward Tenants, proportionate
share of Common Area Charges for the following twelve month period. Upon reasonable notice, Landlord
shall make available for Tenants inspection (which inspection shall be at Tenants sole cost and expense) at
Landlord's office, during normal business hours, Landlords records relating to the Common Area Charges for
such preceding twelve (12) month period. Failure of Landlord to provide the statement called for hereunder
within the time prescribed shall not relieve Tenant from its obligations hereunder.
(c) Capital Improvements Fund. The Common Area Charge, subsection (b) above, includes
the costs of repairs to the roof and/or installation of a new roof, resurfacing of parking lots, along with
repairs and/or replacement of the air conditioning unit(s) and heating system. These four (4) items could
result in a substantial "Common Area Charge" for the year in which any of these items would need to be
replaced. Therefore, a Capital Improvements Fund, (hereinafter the "Fund"), limited in purpose to the roof,
parking lot air conditioning unit(s) and heating system shall be established. Tenant shall pay as Additional
Rent its pro-rata share of the Capital Improvements Fund on a monthly basis. The Fund is hereby capped
at $120,000.00, which amount is to be accumulated over a ten (10) year period. The determination of the
need for Capital Improvements to the four (4) items listed above shall be at the sole discretion of Landlord.
At any fime durim, the ten (40) YOMP ,609d, Icand'911111 May P9 be-mm. , iul-! led In-
. If expenditures from this Fund in any one (1)
year shall exceed the account balance of this Fund, Tenant's monthly pro rata payments to this Fund shall
be increased to make up the deficiency during the following twelve (12) months. If Tenant's initial term,
and any renewals thereof, shall expire before any expenditures are made from this Fund, Tenant shall not
be entitled to a refund of any contributions it has made to the Capital Improvement Funds. However,
should landlord sell the real property herein to any third party not in any way related to Landlord, or its
members, Tenant shall be entitled to repayment of all its contributions to the Fund, minus ten (10%)
administration fees, plus its pro rata share of interest actually earned and accumulated in the Fund, minus
ten (10%) administration fees.
(d) Iaxes. During the Term, Tenant shall pay as Additional Rent a prorate portion of the annual
real estate taxes assessed against the Building & Property, as stated in Sectim 1 „,ln ,soon + m) above. All
taxes assessed prior to the Term but payable in whole or in installments after the Commencement Date, and
all taxes assessed during the Term but payable in whole or in installments after the Term, shall be adjusted
and prorated, so Tenant shall pay its prorate share for the Term and Landlord shall pay Its prorate share for
the periods prior and subsequent to the Term. If at any time during the Tenn, under the taws of the state in
which the Building is located or any political subdivision thereof, a tax on rents is assessed against Landlord
in the form of a license tax or otherwise, such tax shall be deemed a real estate tax and shall be included
within the amount Tenant is required to pay. Tenants prorate share of Real Estate Taxes may be reviewed,
adjusted and billed in the same manner set forth in Section 5, subsection (c) above.
(e) CompeiitiTM+ by Tenant Tenant shall not directly or indirectly engage in any similar or competing
business to that conducted by Tenant in the Leased Premises within a radius of five (5) miles from the
Leased Premises. If Tenant violates this covenant, then in addition to all other remedies available to
Landlord, Tenants gross sales in such similar or competing business shall be deemed Bross Sales and shall
be reported under this Section 5 for the period in which made, and Percentage Rent shall be calculated
thereon. For purposes of this subsection, Tenant shall be deemed to be indirectly engaging in a similar or
competing business If a stockholder or partner of Tenant, or Tenant, if an individual, or any family member of
any of the foregoing, shall have a financial interest in such similar or competing business or if, with Tenants
consent, such similar or competing business is conducted under the same trade name as the business
conducted in the Leased Premises. (This section (e) does not include business currently being done by
tenant under e-church depot (sale of church-related products and Christian literature,) AFIRM - consignment
Landlord's Initials: 4 Tenant's Initial4 i Page
1 Q.J 's
product placing, and Wingspread Publishers (publication of Christian Literature); these business practices
done under tenant ZUR LTD.)
6. Payments All rental and other payments shall be made to Landlord at the address, as
indicated in Section 1, subsection (n), until Landlord otherwise directs in writing. All charges, fees, and other
amounts due, other than Minimum Rent, shall be deemed Additional Rent. Unless otherwise provided in this
Lease or in writing, all payments of Minimum Rent and Additional Rent shall be payable monthly in advance
on or before the first day of each month during the Term, without prior demand and without offset, reduction,
defense, or counterclaim. All payments shall be made prior to the close of business (Eastern Standard Time)
on the date specified for such payment and in immediately available United States funds.
Security Deposit: (None)
8. Trade Fixtureg. Tenant shall have the right to install its trade fixtures in the Leased Premises,
provided such installation shall not interfere with either the construction of the Building or the completion of
any improvements to the Leased Premises which Landlord may have specifically agreed in this Lease to
perform, and such installation shall be at the sole risk and expense of Tenant. All trade fixtures installed in
the Leased Premises by Tenant shall remain the property of, and shall be removable by, Tenant at the
expiration of the Term, provided Tenant is not in default under this Lease, and Tenant shall promptly repair,
or reimburse Landlord for the cost of repairing all damages to the Leased Premises caused by the removal of
those fixtures.
9. C`tmi of Cnmmnn greagand Facilltias by 1 andlnrd, The Common Areas shall at all times
be subject to the exclusive control and management of Landlord, and Landlord shall have the right, from time
to time, to establish, modify, and enforce reasonable rules and regulations with respect to the Common
Areas. Without limiting the foregoing, Landlord shall have the right to construct, maintain, and operate
lighting faculties on all Common Areas; to police the same; to change, in Landlords sole discretion, the area,
level, location, quantity, and arrangement, from time to time, of the Common Areas; to close or discontinue
common use of all or any portion of the Common Areas to such extent as may, in the opinion of Landlord or
Landlord's counsel, be legally sufficient, necessary, or proper to prevent a dedication or the accrual of any
rights to any person or the public; and to do and perform such other acts in and to the Common Areas as
Landlord, in its sole discretion, determines to be necessary to improve the convenience and use thereof by
tenants or their officers, agents, employees, and customers, or to improve the profitability of the Building.
Landlord will operate and maintain the Common Areas in such manner as Landlord, in its sole discretion,
shall determine from time to time. Without limiting the scope of such discretion, Landlord shall have the full
right and authority to employ all personnel and to make all rules and regulations pertaining to the proper
operation and maintenance of the Common Areas and facilities.
10. t Ise of Parking AEsac,
(a) All automobile parking areas, driveways, entrances, and exits in or near the Building,
and other facilities furnished by Landlord in or near the Building, shall at all times be subject to LandW's
exclusive control and management, and Landlord shall have the right from time to time to establish, modify,
and enforce reasonable rules and regulations with respect to all such facilities and areas.
(b) It is expressly understood that the parking areas in the Common Areas are intended
primarily for use by the Servant's Heart Retail Customers in the Building, and Tenant accordingly agrees that
Its employees will not use those parking areas or any of the driveways, streets, or vacant land in the Building
for parking or storing any automobile, truck, or any other vehicle owned or used by any such employee,
except as Landlord may from time to time approve in writing, and with the further exception that Tenant, to
include Tenant's employees, may use the parking spaces in front of the building which are most remote from
the main entrance to the Servant's Heart Store In the event that parking elsewhere on the land adjacent to
the Building is unavailable, until such time as additional parking is made available on said land.
(c) Parking area in front of building is avaitable expressly for retail customer use. Parking
for office employees is to be along the side of the building by receiving, except as provided otherwise in
Paragraph 10 (b). (Exceptions in the cases of any employees holding handicap passes.)
11. Maintenance by I andinrd. Landlord shall, within a reasonable time after having received
written notice from Tenant of such a need, make such repairs to the roof, outside walls (except window,
storefront, and doors), gutters, and downspouts of the Building as may be necessary to keep the Building in
good condition and repair unless such repairs are caused by the negligence or willful act of Tenant or any of
its agents, employees, or contractors, in which event such repairs shall be made by and at the expense of
Tenant Landlord will not be responsible for any damage resulting from any leak or defect in the roof,
sidewalls, gutters, or downspouts unless such damage is due to Landlord's failure to repair such defect within
a reasonable time after Landlord has received notice from Tenant of the need to repair such defect. Landlord
shall maintain in good condition and repair, and adequately light, the parking areas of the Building.
Landlord's Initials: 4 Tenant's Initialsj?, Page
12. pAnintenanCe by Tenant,
(a) General. Tenant shall, at its own cost and expense, keep in good condition and
repair the interior, windows, storefront, and doors of the Leased Premises and the appurtenances thereto,
including without limitation, toilets, plumbing lines, gas, electric lines, fixtures, and equipment, making such
replacements as may be necessary from time to time, it being expressly understood that Tenant shall make
all repairs and replacements necessary to keep the Leased Premises and the appurtenances thereto in good
condition and repair except only those repairs which Landlord has expressly agreed under this Lease to
make. Tenant shall, at its own cost and expense, keep the Leased Premises and entryways, sidewalks,
driveways, and delivery areas adjacent to the Leased Premises clean and free from obstruction, garbage,
dirt, snow, and ice. Tenant shall store all garbage in fully-closed containers in the area designated by
Landlord, and Tenant shall pay all costs incident to the removal thereof. Tenant shall not bum or otherwise
dispose of any garbage in or about the Leased Premises. Tenant shall not tape windows or attach wood
coverings to aluminum frame windows.
13. Mindry rn nants of Tenant. Tenant shall: (a) comply with all federal, state, and municipal
taws, ordinances, and regulations relating to the Leased Premises and Its Permitted Use, including, without
limitation, all environmental laws, rules and regulations (collectively the "Environmental Lows") and all laws,
rules and regulations in connection with the Americans with Disabilities Act of 1990, as amended (the "ADA");
(b) notify Landlord immediately upon receipt of all notices or other communications by governmental
authorities regarding possible or actual noncompliance with laws, ordinances, or regulations; (c) pay promptly
for all electricity, water, and other utilities consumed on or in connection with the Leased Premises, and all
sewage disposal charges assessed against the Leased Premises; (d) not use or permit to be used any
advertising medium or device, such as phonograph, radio, or public address system (except for the public
address / intercom system which serves the interior of the Leased Premises), without Landlord's prior written
consent; (e) not use or permit to be used the Leased Premises for any illegal or immoral purpose; (f) not hold
any fire, bankruptcy, going out-0f-business, or auction sales without Landlord's prior written consent; (g) not
use the sidewalks or any other portions of the Common Areas for any purpose relating to the selling of
merchandise or services; and (h) keep the Leased Premises free from insects, pests, and vermin of all kinds,
and for that purpose Tenant shall use, at Tenant's cost, such pest extermination contractor as Landlord may
direct and at such intervals as Landlord may require.
The Leased Premises shall not be used for the treatment, storage, use, or disposal of toxic or
hazardous wastes or substances, or any other substance, exposure to which is prohibited, limited, or
regulated by a governmental or quasi-governmental authority or which, even 9 not so regulated, could or
does pose a hazard to the health and/or safety of the occupants of the Building or surrounding property.
Tenant shall indemnify and hold Landlord harmless from and against any expense or liability (including
attorney's fees) arising under the Environmental Laws resulting from Tenant's use of the Leased Premises or
any acts and/or omissions of Tenant, its agents, employees, invitees, or independent contractors.
14. loopomcements.
Tenant is accepting the Leased Premises "as is", and Tenant shall pay the cost of any improvements
or alterations desired by Tenant. Any such improvements or alterations to the Leased Premises shall be
performed only after Tenant has obtained the prior written consent of Landlord, which consent may be
withheld for any or no reason. Tenant has inspected the Leased Premises and is satisfied with its physical
condition. Any improvements or alterations to the Leased Premises in addition to those specified on the
Build-Out Rider shall be performed at Tenant's expense, and only after Tenant has obtained the prior written
consent of Landlord, which consent may be unreasonably withheld.
1s. Cnmpianm mMb AnodCanc with nisaWkWac Act of 19M Tenant acknowledges it is a
"public accommodation" as defined by the ADA. If the ADA requires that action be taken with respect to the
Leased Premises (not including the Common Areas), including without limitation removing barriers and
altering the Leased Premises in accordance with the ADA Accessibility Guidelines, such action shall be taken
by Tenant; provided, however, that if such action was required to be taken during Landlord's build-out (if
applicable) of the Leased Premises, Landlord shall take such action. Tenant shall notify Landlord
immediately upon receipt of an oral or written complaint or notice by an employee, customer, client, invitee,
licensee, or governmental authority regarding the ADA.
16. Assignment and Suhatrina. Without Landlord's prior written consent, Tenant shall not
(either voluntarily, involuntarily, or by operation of Law) assign, transfer, mortgage, pledge, hypothecate, or
encumber this Lease or any interest under this Lease; nor sublet or grant concessions of or to the Leased
Premises, in whole or in part; nor allow any person (other than Tenant, its employees, agents, servants, and
Invitees) to occupy or use all or part of the Leased Premises. Landlord's consent may be withheld for any or
no reason. Regardless of any such consent, no assignment or subletting shall release Tenant of its
obligations or alter the primary liability of Tenant to pay rent and perform all its other obligations under this
Lease. Landlord's consent to one assignment, subletting, occupation, or use by any other person shall not
be deemed a consent to any subsequent assignment, subletting, occupation, or use by another person. The
transfer of fifty percent (50%) or more of Tenant's stock, if Tenant is a corporation, or the transfer of fifty
Landlord's Initials: v, Tenant's Initials: -L-W? Page
c
?I
percent (50%) or more of a partnership interest in Tenant, if Tenant is a partnership, shall constitut i
n
assignment under the terms of this Lease. Q, bit 01
NoWhstanding the above, Tenant shah have the right to sublet the porWnyof the Leased Premises
currently used for Tenant's business, provided however, that any subtenant shall be subject to Landlord's
approval, which approval shall not be unreasonably withheld, and further provided that if the rental rate per
square foot of the sublet portion of the Leased Premises exceeds the rental rate per square foot of this
Lease, then Tenant shall pay to Landlord each month, together with the rent due under this Lease, an
amount equal to one half (U2) of the amount by which the rent due under the sublease exceeds the rent
which would be due for the sublet space under the terms of this Lease, computed on a per square foot basis.
17. Condemnation. If the whole or any part of the Leased Premises shall be taken by power of
eminent domain or condemned by any competent authority for any public or quasi-public use or purpose, or if
any adjacent property or street shall be so taken or condemned, or reconfigured or vacated by such authority
in such manner as to require the use, reconstruction, or remodeling of any part of the Leased Premises, or if
Landlord shah grant a deed or other instrument in lieu of such taking by eminent domain or condemnation,
Landlord (and If more than ten percent (10%) of the rentable area of the Leased Premises is taken, or if
access to the Leased Premises or any common restrooms serving the same is materially impaired) Tenant
shall have the option to terminate this Lease upon ninety (90) days notice, provided such notice is given no
later than one hundred eighty (180) days after the date of such taking, condemnation, configuration, vacation,
deed, or other instrument. Landlord shall be entitled to receive the entire award or payment in connection
therewith, and Tenant waives any right it may have to any such award or payment. All rent shall be
apportioned as of the date of such termination or the date of such taking, whichever shah first occur. If any
part of the Leased Premises shall be taken, and this Lease shall not be so terminated, the rent shall be
proportionately abated.
18. Damage by Fin, or nthear Casualty. If the Leased Premises or a substantial portion of the
Building is damaged by fire or other casualty during the Term, Landlord may, at its sole option, either (1)
restore the Leased Premises with reasonable dispatch to substantially the some condition they were in prior
to such damage, insofar as the proceeds from Landlord's insurance permit, or (ii) terminate this Lease. If
Landlord elects to restore the Leased Premises, Landlord shall have no liability to restore any improvements
as may have been made to the Leased Premises, whether before or after the date of this Lease, nor to
restore any of Tenant's fixtures, decorations, equipment, furniture, or inventory. Landlord's sole
responsibility, if any, shall be to deliver to Tenant a shell space with roof, floor, exterior walls, windows, and
doors. If the Leased Premises are rendered untenable in whole or in part as a result of such damage and
this Lease is not terminated, the Minimum Rent and Additional Rent payable shall be equitably and
proportionately abated (according to loss of use) during the period intervening between the date of such
damage and the date the Leased Premises are restored. If Landlord elects to terminate this Lease, all rent
payable shall be abated as of the date of such damage and Tenant shall remove all of its property from the
Leased Premises within thirty (30) days after the notice of termination is given, provided Tenant is not in
default at the time.
19. 1 andlmdia Inc irnnna. Landlord shall maintain during the Term such commercial public
liability insurance for the Common Areas as Landlord deems appropriate, and shall also maintain during the
Term primary, non-contributory insurance on the Building against fire, and extended coverage or "all-risk'
insurance, in an amount equal to the full insurable replacement value of the Building (excluding costs of
excavation, foundations and footings, and such risks required to be covered by Tenants insurance), or such
other amount necessary to prevent Landlord from being a co-insured (collectively, the "Insurance"). Tenant
shall pay as Additional Rent in equal monthly installments, in advance, without prior demand or offset of any
kind, its prorate share of the cost of the Insurance. Tenants prorate share of the insurance is stated in
Section 1, subsection (1), of this lease. Tenant's prorate portion of the Insurance may be reviewed, adjusted
and billed in the same manner as set forth in Section 5, subsection (c) above.
20. lanantc ingi, a
(a) Tenant shall, at all times during the Term and at its own cost and expense, carry: (i)
commercial general liability insurance on the Leased Premises (including Common Aram adjoining the
Leased Premises) with limits of not less than $1,000,000.00 for injury or death to one person, $2,000,000.00
for injury or death to more than one person, and $500,000.00 for property damage; (0) "all-risk' casualty
insurance, written at replooement cost value and with replacement cost endorsement, covering all Tenants
personal property in the Leased Premises (including, without limitation, inventory, trade fixtures, floor
coverings, furniture, and other property removable by Tenant under the provisions of this Lease) and all
Leasehold improvements installed in the Leased Premises by or on behalf of Tenant; (iii) plate glass
insurance; and (iv) if and to the extent required by Law, workmen's compensation or similar insurance.
(b) All such insurance policies shall name Landlord as a named insured and shall be written by
companies acceptable to landlord and in form acceptable to Landlord. Each such policy shall also contain a
provision prohibiting cancellation without thirty (30) days' prior written n to Landlord or its designee.
Landlord's Initials. Tenant's Initials: 040) Page
Certificates of such insurance policies shall be delivered to Landlord promptly after the issuance of the
respective policies and annually thereafter. If Tenant fails to provide or maintain any such insurance,
Landlord may (but shall not be obligated to) do so and collect the cost thereof as Additional Rent.
21. . Tenant shall indemnify and hold Landlord harmless from liability
for damages to person or property (including Tenant's employees, customers, and other invitees) in or upon
the Leased Premises, including vestibules, entryways, and walkways adjoining the teased Premises, and the
loading platform area, if any, allocated to the use of Tenant. Tenant shall also indemnify and hold Landlord
haffnim from such liability for damage in other parts of the Building if caused by Tenant's negligence,
affirmative act, or breach of its obligations under this Lease. All property kept, stored, or maintained in the
Premises shall be kept, stored, or maintained at Tenant's sole risk. Tenant waives all claims against and
releases Landlord, and Landlord's employees and agents, from liability for damages or injury suffered by
Tenant or any person claiming through Tenant as a result of any accident or other occurrence in or upon the
Leased Premises or any other part of the Building, unless the damage or injury was caused by Landlord's
gross negligence or willful misconduct.
22. UVahipr of Ri ib natinn, Tenant waives all claims against Landlord for any damage or loss
Tenant may suffer which is covered by an insurance policy carried by Tenant (or which Tenant is required to
carry under this Lease); and any insurance policy carried by Tenant covering the Leased Premises, its
contents, or any part thereof, shall contain an express waiver of any right of subrogation against Landlord by
the issuer of the policy. Landlord waives all claims against Tenant for any damage or loss Tenant may suffer
which is covered by an insurance policy carried by Landlord (or which Tenant is required to carry under this
Lease); and any insurance policy carried by Landlord covering the Leased Premises, its contents, or any part
thereof, shall contain an express waiver of any right of subrogation against Tenant by the issuer of the policy.
23. fWa<,lt.
23.1 "Fvpnt of rlpfmW1 r)afinpd,
Any one or more of the following events shalt constitute an "Event of Default":
(a) The sale of Tenant's Interest in the Premises under attachment, execution or similar
legal process, or if Tenant is adjudicated as bankrupt or insolvent under any state bankruptcy or insolvency
law or an order for relief is entered against Tenant under the Federal Bankruptcy Code and such adjudication
or order is not vacated within ten (10) days.
(b) The commencement of a case under any chapter of the Federal Bankruptcy Code
by or against Tenant or any guarantor of Tenant's obligations hereunder, or the filing of a voluntary or
involuntary petition proposing the adjudication of Tenant or any such guarantor as bankrupt or insolvent, or
the reorganization of Tenant or any such guarantor, or an arrangement by Tenant or any such guarantor with
its creditors, unless the petition is filed or case commenced by a party other than Tenant or any such
guarantor and is withdrawn or dismissed within thirty (30) days after the date of its filing.
(c) The admission In writing by Tenant or any such guarantor of its inability to pay its
debts when due;
(d) The appointment of a receiver or trustee for the business or property of Tenant or
any such guarantor, unless such appointment shall be vacated within ten (10) days of its entry.
(e) The making by Tenant or any such guarantor of an assignment for the benefit of its
creditors, or if in any other manner Tenant's interest in this Lease shall pass to another by operation of law.
(f) The failure of Tenant to pay any Minimum Rent, Additional Rent, Percentage Rent
("Rental") or other sum of money when due.
(g) Default by Tenant in the performance or observance of any covenant or agreement
of this Lease (other, than a default involving the payment of money), which default is not cured within ten (10)
days after the giving of notice thereof by Landlord, unless such default is of such nature that it cannot be
cured within such ten (10) day period, in which case no Event of Default shall occur so long as Tenant shall
commerce the curing of the default within such ten (10) days period and shall thereafter diligently prosecute
the curing of same; provided, however, if Tenant shall default in the performance of any such covenant or
agreement of this Lease two (2) or more times in any twelve (12) month period, then notwithstanding that
each of such defaults shall have been cured by Tenant, any further similar default shall be deemed an Event
of Default without the ability for cure.
(h) The vacation or abandonment of the Premises by Tenant at any time following
delivery of possession of th Premises to Tenant.
Landlord's Initials: Tenant's Initials: Page
7
(i) . The occurrence of any other event described as constituting an "Event of Default"
elsewhere in this Lease.
23.2 Remedies.
Upon the occurrence of an Event of Default, Landlord, without notice to Tenant in any instance (except where
expressly provided for below or by applicable law) may do any one or more of the following:
(a) With or without judicial process, enter the Premises and take possession of any and
all goods, inventory, equipment, fixtures and all other personal property of Tenant, which is or may be put into
the Premises during the Term, whether exempt or not from sale under execution or attachment (it being
agreed that said property shall at all times be bound with a lien in favor of Landlord, provided however that
any such lien shall be subordinate to any and all secured creditors of Tenant, and shall be chargeable for all
Rental and for the fulfillment of the other covenants and agreements herein contained), and Landlord may
sell all or any part thereof at public or private sale, subject to the interests of any secured creditor of Tenant.
Tenant agrees that ten (10) days prior written notice of any public or private sale shall constitute reasonable
notice. The proceeds of any such sale shall be applied, first, to the payment of all costs and expenses of
conducting the sale or caring for or storing said property (including reasonable attorneys' fees); second,
toward the payment of any indebtedness, including (without limitation) indebtedness for Rental, which may be
or may become due from Tenant to Landlord; and third, to pay Tenant, on demand, any surplus remaining
after all indebtedness of Tenant to Landlord has been fully paid;
(b) Perform, on behalf and at the expense of Tenant, any obligation of Tenant under
this Lease which Tenant has failed to perform and of which Landlord shall have given Tenant notice, the cost
of which performance by Landlord, together with interest thereon at the Default Rate from the date of such
expenditure, shall be deemed Additional Rental and shall be payable by Tenant to Landlord upon demand.
Notwithstanding the provisions of this clause (b) and regardless of whether an Event of Default shall have
occurred, Landlord may exercise the remedy described in this clause (b) without any notice to Tenant if
Landlord, in its good faith judgment, believes it would be materially injured by failure to take rapid action or N
the unperformed obligation of Tenant constitutes an emergency;
(c) Elect to terminate this Lease and the tenancy created hereby by giving ten (10)
days prior written notice of such election to Tenant, and reenter the Premises, without the necessity of legal
proceedings, and remove Tenant and all other persons and property from the Premises, and may store such
property in a public warehouse or elsewhere at the cost of and for the mount of Tenant without resort to
legal process and without Landlord being deemed guilty of trespass or becoming liable for any loss or
damage occasioned thereby; or
(d) Exercise any other legal or equitable right or remedy which it may have.
Any costs and expenses incurred by Landlord (including, without limitation, reasonable attorneys' fees) in
enforcing any of its rights or remedies under this Lease shall be deemed to be Additional Rental and shall be
repaid to Landlord by Tenant upon demand.
23.3 Damages.
If this Lease is terminated by Landlord pursuant to Section 23.2, Tenant nevertheless shall remain liable for
(a) any Rental and damages which may be due or sustained prior to such termination, all reasonable costs,
fees and expenses including, but not limited to, reasonable attorneys' fees, costs and expenses incurred by
Landlord in pursuit of its remedies hereunder, or in renting the Premises to others from time to time (all such
Rental, damages, costs, fees and expenses being referred to herein as 'Termination Damages"), and (b)
additional damages (the "Liquidated Damages"), which, at the election of Landlord, shall be either.
(i) an amount equal to the Rental which, but for termination of this Lease, would have
become due during the remainder of the Term, less the amount of Rental, if any, which Landlord shall receive
during such period from others to whom the Premises may be rented (other than any Additional Rental
received by Landlord as a result of any failure of such other person to perform any of its obligations to
Landlord), in which case such Liquidated Damages shaft be computed and payable in monthly installments,
in advance, on the first day of each calendar month following termination of the Lease and continuing until the
date on which the Term would have expired but for such termination, and any suit or action brought to collect
any such Liquidated Damages for any month shall not in any manner prejudice the right of Landlord to collect
any Liquidated Damages for any subsequent month by a similar proceeding; or
(ii) an amount equal to the present worth (as of the date of such termination) of Rental
which, but for termination of this Lease, would have become due during the remainder of the Term, less the
fair rental value of the Premises, as determined by an independent real estate appraiser named by Landlord,
in which case such Liquidated Damages shall be payable to Landlord ' e lump sum on demand and shall
Landlord's Initials: Tenant's Initials: "Pi Page
bear interest at the Default Rate until paid. For purposes of this clause (ii), "present worth" shall be computed
by discounting such amount to present worth at a discount rate equal to one percentage point above the
discount rate then in effect at the Federal Reserve Bank nearest to the location of the Building.
If this Lease is terminated pursuant to Section 23.2, Landlord may reset the Premises or any part thereof,
alone or together with other premises, for such term or terms (which may be greater or less than the period
which otherwise would have constituted the balance of the Term) and on such terms and conditions (which
may include concessions or free rent and alterations of the Premises) as Landlord, in its sole discretion, may
determine, but Landlord shall not be liable for, nor shall Tenant's obligations hereunder be diminished by
reason of, any failure by Landlord to relet the Premises or any failure by Landlord to collect any rent due upon
such reletting.
Nothing contained in this Lease shall limit or prejudice the right of Landlord to prove and obtain, in
proceedings for the termination of this Lease by reason of bankruptcy or insolvency, an amount equal to the
maximum allowed by any statute or rule of law in effect at the time when, and governing the proceedings in
which, the damages are to be proved, whether or not the amount be greater, equal to, or less than the
amount of the loss or damages referred to above. The failure or refusal of Landlord to relet the Premises or
any part or parts thereof shall not release or affect Tenant's liability for damages.
23.4 Rwroeriiwa in Fvpnt of RnnknlptW nr (Vhpr ppd'ng.
(a) Anything contained herein to the contrary notwithstanding, if termination of this
Lease shall be stayed by order of any court having jurisdiction over any proceeding described in paragraph
(b) of Section 23.1, or by federal or state statute, then, following the expiration of any such stay, or if Tenant
or Tenant as debtor-in-possession or the trustee appointed in any such proceeding (being collectively
referred to as "Tenant" only for the purposes of this Section 23.4) shall fail to assume Tenants obligations
under this Lease within the period prescribed therefor by law or within fifteen (15) days after entry of the order
for relief or as may be allowed by the court, or if Tenant shall fail to provide adequate protection of Landlord's
right, title and interest in and to the Premises or adequate assurance of the complete and continuous future
performance of Tenant's obligations under this Lease, Landlord, to the extent permitted by law or by leave of
the court having jurisdiction over such proceeding, shall have the right, at its election, to terminate this Lease
on fifteen (15) days' notice to Tenant and upon the expiration of said fifteen (15) day period this Lease shall
cease and expire as aforesaid and Tenant shall immediately quit and surrender the Premises as aforesaid.
Upon the termination of this Lease as provided above, Landlord, without notice, may re-enter and repossess
the Premises using such force for that purpose as may be necessary without being liable to Indictment,
prosecution or damages therefor and may dispossess Tenant by summary proceedings or otherwise.
(b) For the purposes of the preceding paragraph (a), adequate protection of Landlord's
right, title and interest in and to the Premises, and adequate assurance of the complete and continuous future
performance of Tenant's obligations under this Lease, shall include, without limitation, the following
requirements:
that Tenant comply with all of its obligations under this Lease;
(ii) that Tenant pay to Landlord, on the first day of each month occurring
subsequent to the entry of such order, or the effective date of such stay, a sum equal to the amount by which
the Premises diminished in value during the immediately preceding monthly period, but, in no event, an
amount which is less than the aggregate Rental payable for such monthly period;
(iii) that Tenant continue to use the Premises in the manner originally required
by this Lease;
(iv) that Landlord be permitted to supervise the performance of Tenant's
obligations under this Lease;
(v) that Tenant pay to Landlord within fifteen (15) days after entry of such order
or the effective date of such stay, as partial adequate protection against future diminution in value of the
Premises and adequate assurance of the complete and continuous future performance of Tenant's
obligations under this Lease, an additional security deposit in an amount acceptable to Landlord;
(VI) that Tenant has and will continue to have unencumbered assets after the
payment of all secured obligations and administrative expenses to assure Landlord that sufficient funds will
be available to fulfill the obligations of Tenant under this Lease;
(vii) that if Tenant assumes this Lease and proposes to assign the same
(pursuant to Title 11 U.S.C. § 365, or as the same may be amended) to any person who shall have made a
bona fide offer to accept an assignment of this Lease on terms acceptable to such court having competent
jurisdiction over Tenant's estate, then notice of such proposed assignment, setting forth (x) the name and
Landlord's Initials: Tenant's Initials: wli?? Page
a
address of such person, (y) all of the terms and conditions of such offer, and (z) the adequate assurance to
be provided Landlord to assure such person's future performance under this Lease, including, without
limitation, the assurances referred to in Title 11 U.S.C. § 365(b)(3), as it may be amended, shall be given to
Landlord by Tenant no later than fifteen (15) days after receipt by Tenant of such offer, but in any event no
later than thirty (30) days prior to the date that Tenant shall make application to such court for authority and
approval to enter into such assignment and assumption, and Landlord shall thereupon have the prior right
and option, to be exercised by notice to Tenant given at any time prior to the effective date of such proposed
assignment, to accept, or to cause Landlord's designee to accept, an assignment of this Lease upon the
same terms and conditions and for the some consideration, If any, as the bons fide offer made by such
person less any brokerage commissions which may be payable out of the consideration to be paid by such
person for the assignment of this Lease; and
(viii) that if Tenant assumes this Lease and proposes to assign the same, and
Landlord does not exercise its option pursuant to paragraph (vii) of this Section 23.4, Tenant hereby agrees
that.
(A) such assignee shall have a net worth not less than the net worth of
Tenant as of the Commencement Date, or such Tenant's obligations under this Lease shall be
unconditionally guaranteed by a person having a net worth equal to Tenant's net worth as of the
Commencement Date;
(B) such assignee shall not use the Premises except subject to all the
restrictions contained in this Lease;
(C) such assignee shall assume in writing all of the terms, covenants
and conditions of this Lease including, without limitation, all of such terms, covenants and conditions
respecting the Permitted Use and payment of Rental, and such assignee shall provide Landlord with
assurances satisfactory to Landlord that it has the experience in operating stores having the same or
substantially similar uses as the Permitted Use, in first-class shopping centers, sufficient to enable it so to
comply with the terms, covenants and conditions of this Lease and successfully operate the Premises for the
Permitted Use;
(D) such assignee shall indemnify Landlord against, and pay to
Landlord the amount of, any payments which Landlord may be obligated to make to any Mortgagee by virtue
of such assignment;
(E) such assignee shall pay to Landlord an amount equal to the
unamortized portion of any construction allowance made to Tenant; and
(F) if such assignee makes any payment to Tenant, or for Tenant's
account, for the right to assume this Lease (including, without limitation, any lump sum payment, installment
payment or payment in the nature of rent over and above the Rental payable under this Lease), Tenant shall
pay over to Landlord one-half of any such payment, less any amount paid to Landlord pursuant to clause (E)
above on account of any construction allowance.
24. leraked bv i andinrer Landlord's failure to insist upon strict performance by Tenant of any
obligation under this Lease, Irrespective of the length of time for which such failure continues, shalt not be
construed as a waiver or relinquishment of Landlord's right to demand strict compliance in the future. The
receipt and acceptance by Landlord of rent with knowledge of the breach of any obligation hereof shall not be
deemed a waiver of such breach, and no waiver by Landlord of any provision of this Lease shall be deemed
to have been agreed upon unless expressed in a writing signed by the parties.
25. Liens Tenant shall pay all sums of money due for labor, services, materials, supplies and
equipment furnished at Tenant's request with respect to the Leased Premises or any other part of the
Building. If a mechanic's, materialman's, or other lien (or notice of intent to file such a lien) is filed or recorded
against the Leased Premises, the Building, or Landlord's interest in either, based upon labor, services,
materials, supplies, equipment, or the like ordered, or alleged to have been ordered by Tenant, Tenant shall
cause such lien to be discharged of record within ten (10) days after Tenant first has knowledge of such lien.
If such lien is not discharged within the ten (10) day period, Landlord may (but shall not be obligated to)
cause such discharge by (1) payment to the lienor, (ii) deposit of substitute security with a court having
jurisdiction, (iii) bonding, or (iv) such other means chosen by Landlord; and the entire cost of the discharge
shall be paid to Landlord by Tenant upon demand. Tenant shall, upon request, fumish Landlord with
contractors' affidavits, full and final waivers of right to lien, and receipted bills covering all labor and materials
expended and used in or about the Leased Premises by or at the request of Tenant.
26. Sinn AMMinen and r annnioc. Tenant shall not place or display (or cause to be placed or
displayed) on any exterior door, wall, or window of the Leased Premises any sign, awning, canopy,
advertising matter, or other thing of any kind, and shall not place or display any decoration, lettering, or
Landlord's Initials: 4?1 Tenant's Initials:v4j6P Page
10
advertising matter on the glass of any window or door of the Leased Premises, without Landlord's prior
written approval. Tenant shall maintain such sign, awning, canopy, decoration, lettering, advertising matter,
or other thing, as may be approved by Landlord, in good condition and repair at all times. Specific criteria
regarding signage is set forth in Exhibit B or in the Ruin and Regulations, Exhibit C.
27. Fvhibitg, Adrianda Ridnc anti Regidatinn?. All Exhibits, Addenda and Rules and
Regulations appended to this Lease are hereby incorporated into this Lease, and Tenant shall comply with
and observe the some. Tenant's failure to comply with and observe the same shall constitute a breach of this
Lease. Landlord reserves the right to amend, supplement, or add to such Rules and Regulations from time
to time.
28. Surrender of Prpmi?a. On expiration or sooner termination of the Term, Tenant shall
surrender to Landlord the Leased Premises and all Tenant's improvements and alterations, broom clean, in
good order, condition, and repair, except for ordinary wear and tear or condemnation or destruction of the
Leased Premises, and except for trade fixtures that Tenant has removed. Tenant shall also deliver to
Landlord all keys to the Leased Premises and the combination to any safe, remove all its personal property,
and make all repairs and reimbursements required pursuant to this Lease; provided, however, Tenant may
not remove its personal property from the Leased Premises without Landlord's prior written consent, if Tenant
is in breach or default hereunder.
Landlord may elect to retain or dispose of in any manner any alterations or Tenant's personal
property that Tenant does not remove from the premises on expiration or termination of the Term. Title to
any such alterations or Tenant's personal property that Landlord elects to retain or dispose of after expiration
of the Term shall vest in Landlord. Tenant waives all claims against Landlord for any damage to Tenant
resulting from Landlord's retention or disposition of any such alterations or personal property. Tenant shall
be liable to Landlord for Landlord's costs of storing, removing, and disposing of any alterations or Tenant's
personal property which Landlord does not elect to acquire.
29. Wnw-e?. Tenant shall indemnify and hold Landlord harmless from and against all costs,
claims, loss, or liability resulting from delay by Tenant in surrendering the Leased Premises, including,
without limitation, any claims made by any succeeding tenant founded on such delay. The parties recognize
and agree that the damage to Landlord resulting from any failure by Tenant to timely surrender possession of
the Leased Premises will be extremely substantial, will exceed the amount of the Minimum Rent payable
under this Lease, and will be impossible to measure accurately. Tenant therefore agrees that if possession
of the Leased Premises is not surrendered to Landlord within twenty-four (24) hours after the date of the
expiration or termination of the Term, then Tenant shall pay, for each month and for each portion of any
month during which Tenant holds over in the Leased Premises after the expiration or termination of the Term,
two times the aggregate of that portion of the Minimum Rent which was payable under this Lease during the
last month of the Term. Nothing contained in this Lease shall be deemed to permit Tenant to retain
possession of the Leased Premises after the expiration of the Term. The provisions of this Section shall
survive the expiration or termination of the Term.
30. AiihnMonaf *on anti . This Lease is and shall be subject and subordinate to any
mortgage, deed of trust, underlying leasehold estate, or other arrangement or right to possession that may
now or hereafter be placed upon or affect the Leased Premises or the land of which the Leased Premises is
a part, or against any building hereafter placed upon the land of which the Leased Premises is a part, to all
advances to be made thereunder, to the Interest and principal payable thereon, and to all renewals,
replacements, modifications, consolidations, and extensions thereof. Upon Landlord's request Tenant shall
execute and deliver such documents, in such terms as Landlord reasonably requests, to evidence the same.
Upon request of any such mortgagee, Tenant shall attom to and acknowledge the foreclosure purchaser or
purchasers as Landlord hereunder.
31. Estoppel raf ifingtan. Upon Landlord's request, Tenant shall execute, acknowledge, and
deliver to Landlord a written statement, addressed to such person as Landlord may request, (a) certifying that
this Lease is in full force and effect and unmodified (or if modified, specifying the modifications), and that
Landlord is not in default under this Lease (or if a default is alleged, specifying the default), (b) stating the
date to which rent and any other charges have been paid by Tenant and the address to which notices to
Tenant should be sent, and (c) certifying or stating such other matters as may be required by Landlord. If
landlord has not received a response within ten (10) days of any such request, such certificate shall be
deemed acceptable to Tenant, whereupon Landlord shall be appointed as Tenants attomey-in-fact to
execute and deliver such certificate.
32. Enhire RAfigR If all or part of the Building can be refinanced or further financed only
upon the basis of modifications of this Lease, Tenant shall enter into a written agreement with Landlord
making such Lease modifications as may be required; provided, however, Tenant shall not be required to
make any such modifications relating to the amount of Rent the use of the Leased Premises, the duration of
the Term, or the improvements, if any, to be made by Landlord to the Leased Premises.
Landlord's Initials: Tenant's Initials: u? Page
t) i
33. Right of Fury. Tenant shall allow Landlord or its representatives to enter the Leased
Premises at any reasonable hour to inspect the same, to make any repairs deemed necessary or desirable,
or to show the premises to prospective tenants, purchasers, or lenders; and six months before the Term
expires, Landlord may place "For Rent' or similar signs in and about the Leased Premises.
to
34. UaOure. Whenever Tenant or Landlord is required by the terms of this Lease or by
law to perform any contract, act, work, labor or services, or to discharge any lien against the Leased
Premises, or to perform and comply with any laws, rules, orders, ordinances, or regulations, but is unable to
perform such act(s), then Tenant or Landlord, as appropriate, shall not be deemed to be in default and the
other party shall not enforce or exercise any of its rights under this Lease, ff and so long as nonperformance
or default is directly caused by strikes, non-availability of materials, war or national defense preemptions,
governmental restrictions, acts of God, acts of the other party, or other similar causes beyond the reasonable
control of the non-performing party. Tenant and Landlord shall in any event pay any sum of money required
to discharge any hen incurred by them if at any time the Leased Premises, or any part thereof, is in danger of
being foreclosed, forfeited, or lost by reason of such lien.
35. r im firm nf. I andlord'e r iahilit. Except to the extent insurance proceeds are actually
received by Landlord, Landlord shall not be responsible or liable for latent defects, deterioration, or change in
the condition of the Building, the Common Areas, or the Leased Premises, or for any damage resulting
therefrom, whether to person or property, or for loss to any property of Tenant as a result of theft or
misplacement, or for inconvenience, business interruption, or loss of business of Tenant for any reason. To
the extent covered by Tenant's insurance, Tenant shall indemnify and hold Landlord harmless from and
against any and all claims arising out of Tenant's use or occupancy of, or from any other activity permitted or
suffered by Tenant in or about, the Leased Premises, the Building, or shall be fully liable for, and shall
indemnify Landlord against, all such claims. Regardless of any other provision of this Lease, If Landlord, or
its employees, officers, or partners are ordered to pay Tenant a money judgment because of Landlord's
default, then Tenant's sole remedy to satisfy the judgment shall be Landlord's Interest in the Building,
including the rental income and proceeds from sale and any insurance proceeds received because of
damage to the Building that are available for use by Landlord. The foregoing shall not be deemed to limit
Tenant's right, If any, to obtain injunctive relief or specific performance.
36. Notirms. Any notice, demand, consent, request, or other communication required or
permitted under this Lease shall be in writing and shall be given by hand delivery or sent by the United States
Mail by oerbfied mail, return receipt requested, postage prepaid, and addressed as indicated in Section 1,
subsection (m), Notice shall be deemed given when hand delivered or two (2) days after deposit with the
United States Postal Service. The parties may change their respective addresses by written notice to all
other parties.
37. Quiet Enlowaient Landlord covenants that Tenant, on paying all rents and performing all the
obligations set forth in this Lease, shall have and enjoy quiet and peaceable possession of the Leased
Premises during the Term.
38. Entire Agreement This Lease contains the entire agreement between the parties with
respect to the leasing of the Leased Premises and supersedes, merges and replaces all prior written or oral
agreements, negotiations, offers, representations, and warranties with respect to the leasing of the Leased
Premises. This agreement cannot be altered, waived, or modified in any way, including the provisions of this
Section, except in a writing signed by the parties. No course of dealing between the parties, no usage of
trade, and no parol or outside evidence of any nature shall be used to modify, interpret, or supplement any
provision of this Lease.
39. S11-h-1 The representations, warranties, and agreements of the parties contained in this
Lease and in all other documents delivered in connection with this Lease shall survive the expiration or
sooner termination of this Lease.
40. Saverability_ If any provision of this Lease is unenforceable, the remainder of this Lease
shall continue in effect and be construed as If the unenforceable provision had not been contained in this
Lease. Each provision of this Lease shall be valid and enforceable to the fullest extent permitted by law.
41. Rig=sWrc anti Assigns. This Lease shall be binding upon and inure to the benefit of the
parties and their respective heirs, personal representatives, successors, and assigns; provided, however,
that this Section shall not be construed to permit the assignment of this Lease except as expressly provided.
42. Thad can„ Beneficiaries. The provisions of this Lease are intended to benefit only the
parties to this Lease. No person not a party to this Lease shall be deemed a third party beneficiary of this
Lease nor shall any such person be authorized or empowered to enforce the provisions of this Lease, except
to the extent such a person becomes a permitted assignee of one of the parties.
Landlord's Initialslk
Tenant's Initials. Page _WJIJ? 12
43. Anue_ Regardless of what venue would otherwise be permissive or required, the parties
stipulate that all actions arising under or affecting this Lease shall be brought in the Court of Common Pleas
of Cumberland County, Pennsylvania, the parties agreeing that such forum is mutually convenient and bears
a reasonable relationship to this Lease.
44, Consent to _hvrisrdiCtion and Service of Rmcess The parties irrevocably submit to the
jurisdiction of the state courts of the Commonwealth of Pennsylvania and to the jurisdiction of the United
States District Court for the Middle District of Pennsylvania, for the purpose of any suit, action, or other
proceeding arising under or affecting this Lease.
45. Count: n_g_ a;; In computing the number of days for purposes of this Lease, all days shall
be counted, including weekends and holidays; provided, however, that if the last day for taking any action
under this Lease shall fag on a Saturday, Sunday or banking holiday, the time for taking such action shall be
extended to the next regular business day.
46. Mimber -(1 Gerdes When used in this Lease, the singular includes the plural, the plural
includes the singular, and the use of any gender includes any other gender, as circumstances may require.
The term "person" includes both natural persons and entities.
47. Headings. The headings contained in this Lease are for the convenience of the parties only
and are not a part of the substantive agreement of the parties nor shall they affect the meaning or
interpretation of any provision of this Lease in any way.
48. rMunterparts. This Lease may be executed in multiple counterparts. When at least one (1)
copy of this Lease has been executed by each party to this Lease, this Lease shall be in full force and effect,
and all of such counterparts shall be read together as a single agreement.
49. Recoang. Upon request of either Tenant or Landlord, the parties shall execute a short form
of this Lease in a written document witnessed and acknowledged in form capable of being recorded in the
public records, which short form Lease shall be recorded at the sole cost and expense of the party requesting
the same in the Office of the Recorder of Deeds in and for Cumberland County, Pennsylvania, wherein the
Leased Premises are located.
% Re?mhursement for Cmdit Report Tenant shall reimburse Landlord upon Landlord's request
for reasonable amounts Landlord has paid to obtain credit reports on Tenant and all Guarantors of Tenant's
obligations under this Lease.
51. Tria?, i,nT Landlord and Tenant each waives any right to trial by jury of any issue(s) Ina
summary proceeding or any other suit, action, proceeding or counterclaim at any time brought or instituted by
or against the other with respect to or involving the Leased Premises or any matter arising under or
connected with this Lease and the relationship of Landlord and Tenant created by this Lease.
Landlord's Initi I •g(
a s. Tenant's Initials: IMA Page
13
IN WITNESS WHEREOF each corporate party hereto has caused this Lease to be executed in Its name and
behalf by its duly authorized officer or agent; each individual party hereto has hereunto set his hand, and
each partnership party hereto has caused this Lease to be executed in its name and behalf by the required
number of its General Partners.
Landlord: jd( 1C/& (,4671 r?G? LZ&
By:
Title: A
Date:?ll?p
Tenant: z y r L TV-
By:`
?` max---^
Title: olo", ?er 1171rc:+t /3-<
Date: z 110A t.
COMMONWEALTH OF PENNSYLVANIA
COUNTY OF 0x M 2kU kh to.wit:
Th? fortigo n?g_ti? acknowledged before me this 200 by
o - 1'f t-J an
onx ?,/(,
Notary Public
My Commission Expires: j -//420
NotadW Sall
Anne Ca-* Noury Pubk
MY Ow"bBbn Expk- Expbaa Mar. 11.2006
Landlord's Initials: Tenant's Initials: Page
14
Landlord's Initials: Tenant's Initials: Page
15
The following provisions establish the criteria and requirements for Tenant's signage in, upon and
around the Leased Premises and the Building. Included herein are the specifications for design, location,
construction and installation of all Tenant signage and the procedure for effecting same. Notwithstanding
anything contained herein or elsewhere in the Lease, Tenant shall not construct or erect any signage In the
Leased Premises or the Building without the prior written approval of the Landlord, which approval may be
withheld, delayed or denied in Landlord's sole and absolute discretion. Furthermore, notwithstanding
anything in this Exhibit B or the Lease to the contrary, Landlord reserves the right to modify, supplement or
eliminate all or any portion of the provisions of this Exhibit B from time to time during the term without notice
to Tenant, and any revisions to this Exhibit B shall be applicable to any pending or subsequent request by
Tenant for any signage.
Tenant shaft be responsible, at Tenant's sole cost and expense, for the design, construction and
installation of any signage approved by Landlord (in its sole discretion.)
a) Tenant shall submit design to Landlord for approval.
resistant.
Composition and Materials - All such figures shall have closed backs and shall be leak
b) Electrical - No flashers, moving signs, panels or other elements will be permitted. Design,
fabrication and Installation of all electrical work shall be in strict adherence to all applicable governmental
laws, codes or ordinances.
c) Structural Location and Attachment - All sign structures or elements shall consist of rigid
metal framework with stable interiors to which anchoring bolts, brackets, sleeves or other approved methods
of attachment can be fastened. Structural design, fabrication and installation shall be adequate to withstand
wind and other natural stresses and be sufficient to support the weight of the elements so attached. The sign
and Its elements shall have concentric horizontal alignment with Tenant's demised storefront and concentric
vertical alignment with the sign band as specified by Landlord. AN letters, numbers, logos, emblems or other
elements shall be individually attached to the building by means of concealed. fasteners accomplished so as
to minimize damage to the building and allow for ease of removal; it being understood and agreed that
Tenant shall be responsible for the repair of any damage resulting from the improper installation or removal of
its signage. No raceways shall be permitted. No part of the signage or fasteners shall have corrosive or
stainable materials.
a) Design and Submission - Tenant shall submit two (2) copies of its proposed sign drawings
and specifications to Landlord, and the required number of copies to the governmental authorities having
Jurisdiction for approval, if necessary, prior to fabrication and installation. Tenant or its sign contractors shall
secure and pay for all necessary permits and authorizations required by public authorities for the installation
and operation of any Tenant signage. Such drawings and specifications shall clearly indicate all dimensions
and materials to be used including size, copy and color of all letters, numbers, logos and emblems in full
detail. At least one (1) copy of said drawings shall be rendered in colors as close to those proposed to be
used and shall be submitted to Landlord. Landlord thereafter shall respond with any changes required and
Landlord's determination in all signage matters shall be deemed to be conclusive and binding., Any delays or
denials of signage approval shall in no way affect Tenant's obligations under the Lease or any other provision
dealing with Tenant's construction, occupancy or use of the Leased Premises.
b) Contractors - The sign(s) furnished by Tenant shall be fabricated and installed by a licensed
contractor(s) in accordance with the criteria and requirements contained herein and in strict compliance with
all applicable codes, taws, ordinances and/or regulations of any governmental authorities having jurisdiction
thereof. For the purposes of the Lease, signage fabrication and installation shall be deemed an item of
Tenant's Work and all of the requirements imposed upon contractors, subcontractors or agents pursuant to
the provisions of the Lease shall apply hereto.
Landlord's Initials: 4 Tenant's Initials:/ Page
a) Miscellaneous Sign(s) - Tenant shall not affix any signs, advertising placards, names,
insignias, trademarks or other descriptive materiaks) (i) upon the glass panes, mullions, supports or doors of
Tenants demised storefront, (ii) within twelve (12") inches of any show window or front door, or (iii) upon the
exterior walls of the Leased Premises, without the prior written approval of Landlord, which approval may be
withheld, delayed or denied in Landlord's sole discretion. Notwithstanding anything to the contrary in the
Lease, under no circumstances shall any sign be affixed to the roof of the leased Premises or the Building.
Landlord's i ' 4? /
In teals.• Tenant's Initials?yJt Page
(a) QRSTRIICIION OF PASSAMWAYR The sidewalks, passages, courts, corridors, and
other public parts of the Building shall not be obstructed or encumbered by Tenant or used by Tenant for any
purpose other than ingress and egress.
(b) VANDOdlYS Windows in the Leased Premises shall not be covered or obstructed by
Tenant. No bottles, parcels, or other articles shall be placed on the window sills, in the halls, or in any other
part of the Building. No articles shall be thrown out of the doors or windows of the Leased Premises.
(c) PROJECTIONS ERQM RI III DING No awnings, air conditioning units, or other fixtures
shall be attached to the outside wails or the window sills of the Building by Tenant or otherwise affixed by it so
as to project from the Building, without the prior written consent of Landlord.
(d) SIGNS No sign or lettering shall be affixed by Tenant to any part of the outside of the
Building, or any part of the inside of the Leased Premises so as to be clearly visible from the outside of the
Building, without prior written consent of Landlord.
(e) FLOOR COVERING -(OMITTED)
(f) iNSERFFRFNCF wTH QCr`I MANTA OF RI 111 DING Tenant shall not ke, or permit to be
made, any unseemly or disturbing noises and shall not interfere with other tenants or those having business
with them. Tenant will keep all mechanical apparatus in the Leased Premises free of vibration and noise
which may be transmitted beyond the limits of the Leased Premises.
(g) II OCK____ S -KEYS No additional locks or bolts of any kind shall be placed on any of the doors
or windows by Tenant. Tenant shall, on the termination of Tenant's tenancy, deliver to Landlord all keys to
any space within the Building, either furnished to or otherwise procured by Tenant, and in the event of the
loss of any keys furnished, Tenant shall pay Landlord the cost thereof. Tenant, before closing and leaving
the Leased Premises, shall ensure that all its windows are closed and its entrance doors locked.
(h) CONTRACTORS Landlord shall not be responsible to Tenant for any loss of property from
the Leased Premises however occurring, or for any damage done to the effects of Tenant by janitors or any
of Tenant's employees, or by any other person or any other cause.
0) PRnbtBLTED ON EASED PRFMIRFS Tenant shall not, without the prior written approval
of Landlord, (i) conduct, or permit any other person to conduct, any auction upon the Leased Premises, (ii)
permit the Leased Premises to be used for gambling or any other illegal activity, (ill) make any unusual noises
in the Building, (iv) permit to be played any musical instrument on the Leased Premises, (v) permit to be
played any radio, television, recorded or wired music in such a bud manner as to disturb or annoy other
tenants, or (vi) permit any unusual odors to be produced upon the Leased Premises. Canvassing, soliciting
and peddling in the Building are prohibited, and Tenant shall cooperate to prevent the same. No bicycles,
vehicles or animals of any kind shall be brought into or kept in or about the Leased Premises or the Building,
except that vehicles may be parked in the parking spaces provided in the Common Areas and in accordance
with such other rules with respect to vehicles and parking as may be established from time to time by
Landlord.
0) PI IWRING El FCTRIC AND TELEPHONE WORK Plumbing facilities shall not be used
for any purpose other than those for which they were constructed; and no sweepings, rubbish, ashes,
newspaper or other substances of any kind shall be thrown into them. Waste and excessive or unusual
usage of electricity or water is prohibited. When electric wiring of any kind is introduced, It must be
connected as directed by Landlord, and no stringing or cutfing of wires will be allowed, except by prior written
consent of Landlord, and shall be done by contractors approved by Landlord.
(k) SAFF$ AND OTHER HEAVY _EQ(HPMFNT Landlord reserves the right to prescribe the
weight and position of all safes and other heavy equipment so as to distribute properly the weight thereof and
to prevent any unsafe condition from arising.
(1) NOTICE OF ACUDENTS Tenant shall give Landlord prompt written notice of any accident
or damage occurring on or to the Leased Premises or the Common Areas adjacent to the Leased Premises.
Landlord's Initials: 4 Tenant's Initials: o
Page
EXHIR D
RI-111 0.0111 RIDER
TENAurs PERFORMANCE
THIS AGREEMENT made as of the day of 2005, between
("Landlord") and
('Tenant"). The parties hereby acknowledge that they have heretofore entered, or are contemporaneously
herewith entering, a certain Lease agreement dated , 2005 (the "Lease") for
premises (the "Leased Premises") known as located in the property known as
(the "Property").
1. The VVnrk Under the Lease, Tenant has agreed to accept the Leased Premises "as is",
without any obligations for the performance of improvements or other work by Landlord, and Tenant desires
to perform certain improvements thereto (the "Work"). Such Work shall be in accordance with the provisions
of this Work Agreement, and to the extent not expressly inconsistent herewith, in accordance with the
provisions of the Lease. Performance of the Work shall not serve to abate or extend the time for the
commencement of Rent under the Lease, except to the extent Landlord delays approvals beyond the times
permitted below.
2. Cost of the ZbEk Except as provided hereinafter, Tenant shall pay all costs (the "Costs of
the Work") associated with the Work whatsoever, including without limitation, all permits, inspection fees, fees
of space planners, architects, engineers, and contractors, utility connections, the cost of all labor and
materials, bonds, insurance, and any structural or mechanical work, all HVAC equipment or sprinkler heads,
or modifications to any building mechanical, electrical, plumbing or other systems and equipment or
relocation of any existing sprinkler heads, either within or outside the Leased Premises required as a result of
the layout, design or construction of the Work.
Of the Costs of the Work, Landlord shall reimburse Tenant the amount of $ (the
"Improvement Allowance"). The Improvement Allowance shall be funded by Landlord within thirty (30) days
after the Work has been completed in accordance with the "Space Plan" and "Working Drawings" approved
by Landlord in writing in accordance with the provisions hereof, and Tenant has submitted all invoices, lien
waivers, affidavits of payment, and such other evidence as Landlord may reasonably require that the cost of
the Work has been paid for and that no mechanic's, materialmen's, or other such liens have been or may be
filed against the Property or the Leased Premises arising out of the design or performance of the Work. In
the alternative, at Landlord's sole option, Landlord may elect to fund the Improvement Allowance in
installments, not more frequently than monthly, based on applications for payment and releases of lien rights,
submitted by Tenant on Landlord's standard form for use by contractors requesting progress payments,
together with such lien releases and affidavits of payments by Tenants general contractor and
subcontractors contemplated therein, and such other documentation as Landlord may reasonably require.
Landlord may issue checks to fund the Improvement Allowance jointly to Tenant, its general contractor, and,
at Landlord's option, to any subcontractors or suppliers.
a. No later than ten (10) days after the date of this Work Agreement set forth above,
Tenant shall submit two (2) sets of a "Space Plan" (as described in Section 16 below) to Landlord for
approval,
b. Landlord shall, within ten (10) days after receipt thereof, either approve said Space
Plan, or disapprove the same advising Tenant of the reasons for such disapproval. In the event Landlord
disapproves said Space Plan, Tenant shall modify the some, taking Into account the reasons given by
Landlord for said disapproval, and shall submit two (2) sets of the revised Space Plan to Landlord within five
(5) days after receipt of Landlord's initial disapproval.
a. No later than twenty (20) days after receipt of Landlord's approval of the Space
Plan, Tenant shall submit to Landlord for approval two (2) sets of "Working Drawings" (as defined in Section
16 below), and a report (the "Engineering Report") from Tenant's mechanical, structural and electrical
engineers indicating any special heating, cooling, ventilation, electrical, heavy bad or other special or unusual
requirements of Tenant.
b. Landlord shall, within ten (10) working days after receipt thereof, either approve the
Working Drawings and Engineering Report, or disapprove the same advising Tenant of the reasons for
disapproval. It Landlord isapproves of the Working Drawings or Engineering Report, Tenant shall modify
Landlord's Initials Tenant's Initials: 'LlJ Page
and submit revised Working Drawings, and a revised Engineering Report, taking into account the reasons
given by Landlord for disapproval, within five (5) days after receipt of Landlord's initial disapproval.
5, ( andmnOr A.?oyal- Landlord shall not unreasonably withhold approval of any Space
Plans, Working Drawings, or Engineering Report submitted hereunder if they provide for a customary
with finishes and materials generally conforming to building standard finishes and
materials currently being used by Landlord at the Property, are compatible with the Property's exterior
construction, and if no modifications will be required for the Property's electrical, heating, air conditioning,
ventilation, plumbing, fire protection, life safety, or other systems or equipment, and will not require any
structural modifications to the Property whether required by heavy loads or otherwise.
6. Spare PlannPin ArrhitPctq, Fngin"Cg,_anri r nn ractom, The Space Plan, Working
Drawings, Engineering Report and the Work, shall be prepared and performed by such space planners,
architects, engineers and contractors as Landlord customarily engages or recommends for use at the
Property; provided, Tenant may substitute another licensed, bonded, reputable and qualified space planner,
architect, engineer or contractor, who will work in harmony with each other and those of Landlord so as to
ensure proper maintenance of good labor relationships. Such substitutions may be made only with
Landlord's prior written approval. Such approval shall be granted or denied within ten (10) days after
landlord receives from Tenant a written request for such substitution, containing a reasonable designation of
the proposed party's background, references and qualifications. Any such substitution shall not serve to
delay the times for submission of the Space Plan, Working Drawings and Engineering Report required
herein, except to the extent that Landlord delays granting or denying approval beyond the aforementioned
ten (10) day period.
7. Change _._?rdp s: No changes, modifications, alterations or additions to the approved Space
Plan or Working Drawings may be made without the prior written consent of the Landlord after written request
therefor by Tenant. In the event that the Leased Premises are not constructed in accordance with said
approved Space Plan and Working Drawings, then Tenant shall not be permitted to occupy the Leased
Premises until the Leased Premises reasonably comply in all aspects with said approved Space Plan and
Working Drawings; in such case, the Rent shall nevertheless commence to accrue and be payable as
otherwise provided in the Lease.
8. Compliance: Tenant's Work shall comply in all respects with the following: (a) the Building
Code of the City and State in which the Building is located and State, County, City or other laws, codes,
ordinances and regulations, as each may apply according to the rulings of the controlling public official, agent
or other such persons, (b) applicable standards of the National Board of Fire Underwriters and National
Electrical Code, and (c) building material manufacturer's specifications.
9. 11,11-rass: Each contractor, subcontractor and supplier participating in Tenant's Work
shall guarantee that the portion thereof for which he is responsible shall be free from any defects in
workmanship and materials for a period of not less than one (1) year from the date of completion thereof.
Every such contractor, subcontractor, and supplier shall be responsible for the replacement or repair, without
additional charge, of all work done or furnished in accordance with its contract which shall become detective
within one (1) year after completion thereof. The correction of such work shall include, without additional
charge, all additional expenses and damages in connection with such removal or replacement of all or any
part of Tenant's Work, and/or the Property and/or Common Areas, or work which may be damaged or
disturbed thereby. All such warranties or guarantees as to materials or workmanship of or with respect to
Tenant's Work shall be contained in the contract or subcontract which shall be written such that said
warranties or guarantees shall inure to the benefit of both Landlord and Tenant, as their respective interests
may appear, and can be directly enforced by either. Tenant covenants to give Landlord any assignment or
other assurances necessary to effect such right of direct enforcement. Copies of all contracts and
subcontracts shall be furnished to Landlord promptly after the same are entered.
10. Pnrrnrrnanre -
a. Tenant's Work shall be commenced within fifteen (15) days after Landlord approves
the Working Drawings, and shall thereafter be diligently prosecuted to completion, subject to delays for
reasons beyond Tenant's control (except financial matters). All Work shall conform with the Working
Drawings approved by Landlord in writing, and Landlord may periodically inspect the Work for such
compliance. Tenant's Work shall be coordinated under Landlord's direction with the work being done or to be
performed for or by other tenants in the Property so that Tenants Work will not interfere with or delay the
completion of any other construction work in the Property.
b. Tenants Work shall be performed in a thoroughly safe, first-class and workmanlike
manner in conformity with the approved Space Plan and Working Drawings, and shall be in good and usable
condition at the date of completion.
Landlord's Initials: 6 Tenant's Initials:b Page
Q Tenant shall be required to obtain and pay for all necessary permits andlor fees with
respect to Tenants Work, and the some shall be shown to Landlord prior to commencement of the Work.
d. Each contractor and subcontractor shall be required to obtain prior written approval
from Landlord for any space outside the Leased Premises within the Property, which such contractor or
subcontractor desires to use for storage, handling, and moving of his materials and equipment, as well as for
the location of any facilities for his personnel.
e. The contractors and subcontractors shall be required to remove from the leased
Premises and dispose of, at least once a week and more frequently as Landlord may direct, all debris and
rubbish caused by or resulting from the construction. Upon completion of Tenants Work, the contractors and
subcontractors shall remove all surplus materials, debris and rubbish of whatever kind remaining within the
Property which has been brought in or created by the contractors and subcontractors in the performance of
Tenants Work. If any contractor or subcontractor shall neglect, refuse or fail to remove any such debris,
rubbish, surplus material or temporary structures within two (2) days after notice to Tenant from Landlord with
respect thereto, Landlord may cause the same to be removed by contract or otherwise as Landlord may
determine expedient, and charge the cost thereof to Tenant as Additional Rent under the Lease.
f. Tenant shall obtain and fumish Landlord all approvals with respect to electrical,
water and telephone work as may be required by the respective company supplying the service. Tenant
shall obtain utility service, including meter from the utility company supplying service, unless Landlord elects
to supply service and/or meters.
g. Landlord shall have the right to require Tenant to fumish bonds or other security in
form and amount reasonably satisfactory to Landlord for the prompt and faithful performance and payment
for Tenants Work.
h. Landlord's acceptance of Tenant's Work as being complete in accordance with the
approved Space Plan and Working Drawings shall be subject to Landlord's inspection and written approval.
Tenant shall give Landlord five (5) days prior written notification of the anticipated completion date of Tenant's
Work.
i. If contemplated or permitted under the statutes of the State in which the Property is
located, within ten (10) days after completion of construction of Tenant's Work, Tenant shall execute and file
a Notice of Completion with respect thereto.
j. Tenant shall, at its cost and expense construct, purchase, install and perform any
and all Items of Tenants Work, stock its merchandise, and employ its personnel so as to obtain any
governmentally required certificate of occupancy and to occupy the Leased Premises as soon as possible,
and in all cases on or before the date required therefor hereunder or under the Lease.
k. If an expansion joint occurs within the Leased Premises, Tenant shall install finish
floor covering to or covering such joint in a workmanlike manner, and Landlord shalt not accept responsibility
for any finish floor covering applied to or installed over the expansion joint.
I. Copies of "as built' drawings shall be provided to Landlord no later than thirty (30)
days after completion of the Work.
M. Landlord's approval of Tenants plans and specifications, and Landlord's
recommendations or approvals concerning contractors, subcontractors, space planners, engineers or
architects, shall not be deemed a warranty as to the quality or adequacy of the Work, or the design thereof,
or of its compliance with laws, codes and other legal requirements.
n. Tenant shall conduct its labor relations with employees so as to avoid strikes,
picketing, and boycotts of, on or about the Leased Premises or Property. If any employees strike, or if picket
lines or boycotts or other visible activities objectionable to Landlord are established, conducted or carried out
against Tenant, its employees, agents, contractors, subcontractors or suppliers, In or about the Leased
Premises or Property, Tenant shall immediately close the Leased Premises and remove or cause to be
removed all such employees, agents, contractors, subcontractors and suppliers, In or about the Leased
Premises or Property, Tenant shall immediately close the Leased Premises and remove or cause to be
removed all such employees, agents, contractors, subcontractors and suppliers until the dispute has been
settled.
o. Landlord shall not be responsible for any disturbance or deficiency created in the air
conditioning or other mechanical, electrical or structural facilities within the Property or Leased Premises as a
result of the Work. If such disturbances or deficiencies result, Tenant shall correct the same and restore the
services to Landlord's reasonable satisfaction, within a reasonable time.
Landlord's Initials: Tenant's Initials: Page
P. If performance of the Work shall require that additional services or facilities be
provided, Tenant shall pay Landlord's reasonable charges therefor.
q. Tenant's contractors shall comply with the rules of the Prop" and Landlord's
requirements respecting the manner of handling materials, equipment and debris. Demolition must be
performed at such times as Landlord determines in its sole judgment as least disruptive to the Building
tenants. Delivery of materials, equipment and removal of debris must be arranged to avoid any
inconvenience or annoyance to other tenants. The Work and all cleaning in the Leased Premises must be
controlled to prevent dirt, dust or other matter from infiltrating into adjacent tenant or mechanical areas or the
parking lots.
r. Landlord may impose reasonable additional requirements from time to time in order
to ensure that the Work, and the construction thereof does not disturb or interfere with any other tenants of
the Property, or their visitors, contractors or agents, nor interfere with the efficient, safe and secure operation
of the Property.
11. Ingliron- All contractors and subcontractors shall carry Worker's Compensation Insurance
covering all of their respective employees in the statutory amounts, Employer's Liability Insurance in the
amount of at least $500,000 per occurrence, and comprehensive general liability insurance of at least
$3,000,000 combined single limit for bodily injury, death, or property damage; and the policies therefor shall
cover Landlord, Tenant, as additional insureds, as well as the contractor or subcontractor. Tenant shall carry
builder's risk insurance coverage respecting the construction and improvements to be made by Tenant, in the
amount of the anticipated cost of construction of the Work (or any guaranteed maximum price). All insurance
carriers hereunder shall be rated at least A and X in Best's Insurance Guide. Certificates for all such
insurance shall be delivered to Landlord before the construction is commenced or contractor's equipment is
moved onto the Property. All policies of insurance must require that the carrier give Landlord twenty (20)
day's advance written notice of any cancellation or reduction in the amounts of insurance. In the event that
during the course of Tenant's Work any damage shall occur to the construction and improvements being
made by Tenant, then Tenant shall repair the same at Tenant's cost.
12. Signage The content of all signage shall be subject to Landlord's prior written approval. No
other signage may be installed or placed outside the Leased Premises by Tenant unless installed in
accordance with the Landlord's signage criteria.
13. Asbestos* If the Property was constructed at a time when asbestos was commonly used in
construction, Tenant acknowledges that asbestos-containing materials ("ACM") may be present at the
Property, and that airborne asbestos fibers may involve a potential health hazard unless proper procedures
are followed. In such case, before commencing the Work, Tenant and its contractor shall consult with
Landlord and LandWs asbestos consultant concerning appropriate procedures to be followed. Landlord
shall, at Tenant's expense, undertake any necessary initial asbestos-related work, before Tenant
commences the work. During performance of the Work, Tenant shall require that its contractor comply with
all laws, rules, regulations and other governmental requirements, as well as all directives of Landlord's
asbestos consultant, respecting ACM. Tenant hereby irrevocably appoints Landlord and Landlord's asbestos
consultant as Tenant's stump; -rn-e+ for purposes of supervising and directing any asbestos-related
aspects of the Work (but such appointment shall not relieve Tenant from its obligations hereunder, nor
impose any affirmative requirement on Landlord to provide such supervision or direction).
14. Liens; Tenant shall keep the Property and the Leased Premises free from any mechanic's,
materialman's or similar liens or other such encumbrances in connection with the Work, and shall indemnify
and hold Landlord harmless from and against any claims, liabilities, judgments, or costs (including attorneys'
fees) arising in connection therewith. Tenant shall give Landlord notice at least twenty (20) days prior to the
commencement of the Work (or such additional time as may be necessary under applicable laws), to afford
Landlord the opportunity of posting and recording appropriate notices of non-responsibility. Tenant shall
remove any such lien or encumbrance by bond or otherwise within thirty (30) days after written notice by
Landlord, and if Tenant shall fail to do so, Landlord may pay the amount necessary to remove such lien or
encumbrance, without being responsible for investigating the validity thereof. The amount paid shall be
deemed Additional Rent under the Lease payable upon demand, without limitation as to other remedies
available to Landlord under the Lease. Nothing contained herein shall authorize Tenant to do any act which
shah subject Landlord's title to the Property or Leased Premises to any liens or encumbrances whether
claimed by operation of law or express or implied contract. Any claim to a lien or encumbrance upon the
Property or Leased Premises arising in connection with the Work shall be null and void, or at Landlord's
option shall attach only against Tenant's Interest in the Leased Premises and shall in all respects be
subordinate to Landlord's title to the Property and Leased Premises.
15. tndemnitV Tenant shall indemnify, defend and hob harmless Landlord (I6nd Landlord's
principals, partners, agents, trustees, beneficiaries, officers, employees and affiliates) from and against any
claims, demands, losses, damages, injuries, liabilities, expenses, judgments, liens, encumbrances, orders
and awards, together with attomays' fees and litigation ex "s arising out of or in connection with the
Landlord's Initials: Tenant's Initials Page
4
Work, or Tenant's failure to comply with the provisions hereof, or any failure by Tenant's contractors,
subcontractors or their employees to comply with the provisions hereof, except to the extent caused by
Landlord's intentional or negligent acts.
16. f:artain r>afindianc-
a. "Space Plan" herein means a layout plan, drawn to scale, showing (1) demising
walls, interior partition walls and Interior doors, including any special walls, glass partitions or special features,
(2) any restrooms, kitchens, computer moms, and other special purpose rooms, and any sinks or other
plumbing facilities, or other special facilities or equipment, (3) any communications system, indicating
telephone and computer outlet locations, and (4) any other details or features required to reasonably
delineate the Work to be performed.
b. "Working. Drawings" herein means fully dimensioned architectural construction
drawings and specifications, and any required engineering drawings (including mechanical, electrical,
plumbing, air-conditioning, ventilation and healing) and shall include any applicable items described above for
the Space Plan, and if applicable: (1) electrical outlet locations, circuits and anticipated usage therefor, (2)
reflected cefiing plan, including fighting, switching, and any special ceiling specifications, (3) duct locations for
heating, ventilating and air-conditioning equipment, (4) details of all millwork, (5) dimensions of all equipment
and cabinets to be built In (6) furniture plan showing details for space occupancy, (7) keying schedule, (8)
lighting arrangement, (9) location of any major equipment or systems (with brand names wherever possible)
which require special consideration relative to air-conditioning, ventilation, electrical, plumbing, structural, fire
protection, life-fire-safety system, or mechanical systems, (10) special heating, ventilating and air conditioning
equipment and requirements, (11) weight and location of heavy equipment, and anticipated loads for special
usage rooms, (12) demolition plan, (13) partition construction plan, (14) type and color of floor and wall-
coverings, wall paint and any other finishes, and any other details or features required to completely delineate
the Work to be performed and (15) a site plan, if applicable, including landscaping, and exterior signage.
17. Taxes: Tenant shall pay prior to delinquency all taxes, charges or other governmental
impositions (including without limitation, any real estate taxes or assessments, sales tax or value added tax)
assessed against or levied upon Tenants fixtures, furnishings, equipment and personal property located in
the Leased Premises and the Work to the Leased Premises under this Agreement. Whenever possible,
Tenant shall cause all such items to be assessed and billed separately from the property of Landlord. In the
event any such items shall be assessed and billed with the property of Landlord, Tenant shall pay its share of
such taxes, charges or other governmental impositions to Landlord within thirty (30) days after Landlord
delivers a statement and a copy of the assessment or other documentation showing the amount of such
impositions applicable to Tenant.
18. INCORPORATED INTO LEASE; DEFAULT. THE PARTIES AGREE THAT THE
PROVISIONS OF THIS WORK AGREEMENT ARE HEREBY INCORPORATED BY THIS REFERENCE
INTO THE LEASE FULLY AS THOUGH SET FORTH THEREIN. In the event of any express
inconsistencies between the Lease and this Work Agreement, the latter shall govern and control. If Tenant
shall default under this Work Agreement, Landlord may order that all Work being performed in the Leased
Premises be stopped immediately, and that no further deliveries to the Leased Premises be made, until such
default is cured, without limitation as to Landlord's other remedies. Any amounts payable by Tenant to
Landlord hereunder shall be paid as Additional Rent under the Lease. Any default by the other party
hereunder shall constitute a default under the Lease and shall be subject to the remedies and other
provisions applicable thereto under the Lease. If Tenant shall default under the Lease or this Work
Agreement and fail to cure the same within the time permitted for cure under the Lease, at Landlord's option,
all amounts paid or incurred by Landlord towards the Improvement Allowance shall become immediately due
and payable as Additional Rent under the Lease.
Landlord's Initials:
d
LANDLORD:
By: Date:
Title:
TENANT: Z,, V- >! tcP
By: Date:
Title:
Tenant's Initials-0 ut Page
? w
EXHIRI E
GI MANTIC
THIS GUARANTY ("Guaranty") is made this Id day of lc b • , 2006, by and between
Kenneth R. Paton and W. Douglas Weardenburg (Individually "Guarantor" and collectively "Guarantors") and
Alpha Omega Limited, LLC ("Landlord"), with respect to certain present and future obligations of Zur, LTD
('Tenant").
WHEREAS, Tenant wishes to enter into a Building Lease (the "Lease") between Tenant and
Landlord (all obligations of Tenant under the Lease, whether now existing or hereafter incurred, whether
direct, indirect, contingent or fixed, whether incurred as primary obligor, co-maker, endorser, or guarantor,
whether otherwise guaranteed or secured, and whether on open account, evidenced by a written instrument
or otherwise, are collectively referred to as the "Obligations"); and
WHEREAS, Landlord has required additional assurances of Tenant's performance of the Obligations
as a condition of entering into the Lease.
NOW, THEREFORE, in consideration of good and valuable consideration and in order to induce
Landlord to enter Into the Lease, the parties agree as follows:
1. Guaranty: Each of the Guarantors jointly and severally guarantee to Landlord the prompt
performance when due of the Obligations, including without limitation payment of all sums due under the
Lease, plus any interest, penalties, and collection fees thereon. Each of the Guarantors agrees to make
such payments to Landlord and perform any non-monetary Obligations, if there is any default in the payment
or the performance of the Obligations.
2. Natilm of Guamnly, This is a continuing, unconditional Guaranty and the liability of each of
the Guarantors to Landlord is not limited to a proportionate part of the total liability of the Tenant to Landlord.
This is a guaranty of payment and not of collection, and each of the Guarantors waives any right to require
that any action be brought against the Tenant, or any other Guarantor, or to require that Landlord proceed
against any security, or any other person, and agrees that Landlord assumes no responsibility for the validity
or enforceability of any security for the Obligations.
3. S,th_mation, As a material inducement for Landlord to accept this Guaranty and enter into
the Lease, the Guarantors represent and warrant that they have no right of indemnification from or against
Tenant, any such right being waived. In lieu of any other remedy the Guarantors may have against Tenant,
the Guarantors shall be subrogated to the rights of Landlord against Tenant; provided that none of the
Guarantors shall be subrogated to, or may enforce on the part or behalf of any of the Guarantors, any right of
action which Landlord may have against the Tenant until the Obligations shall have been paid in full.
4. Cmditinna Precedent- Each of the Guarantors represents and warrants that his liability
under this Guaranty is not contingent or conditional upon any other person signing this Guaranty or the
obtaining or perfecting of any security for the Obligations, or any other condition precedent or subsequent.
5. [hangs Aff mbnn rho nhrinatinnw Landlord may, from time to time, either before or after
the death of any of the Guarantors, or any default by the Tenant, with or without further notice to any of the
Guarantors, renew or extend the time of payment of the Obligations, and grant and allow such indulgences,
modifications, or compromises in connection therewith as it deems advisable or expedient, and may change,
renew, extend, surrender, impair, or compromise, in whole or in part, any security at any time held by or
available to Landlord for the Obligations or for any obligation of any other person secondarily or otherwise
liable on the Obligations, intentionally or unintentionally, or may waive, release, extend, or modify the rights of
any of the Guarantors, without impairing the enforceability of this Guaranty. The death, disability, or
discharge in bankruptcy of the Tenant or any of the Guarantors shall not affect the liability of any remaining
Guarantors.
6. rnara of r:nuaef;nn• Each of the Guarantors shall, upon demand, pay all costs and
expenses incurred by Landlord in connection with the enforcement or collection of the Obligations or the
enforcement of this Guaranty, including attorneys' fees and disbursements. In determining attorneys' fees,
the parties deem the following to be reasonable: the greater of either (a) twenty-five percent ( 15%) of the
amount due at the time payment is made, including all past due interest, costs, and fees, or (b) $1,500 in fees
if the matter is litigated belom a District rolat•c-or $5,000 in fees if the matter is litigated in the Court
Common pleas, plus all actual costs and disbursements.
7. aainatareMent of Guarani Even if the Obligations may have been paid in full and this
Guaranty may have been returned to the Guarantors, this Guaranty shall continue in full force and effect with
Landlord's Initials: Tenant's Initialsj??,? Page
respect to any amounts that Landlord may ever be required to repay under any bankruptcy or insolvency
laws.
6. Mkmuu of 44nmastead Notk- Each of the Guarantors hereby waives the benefit of any
homestead exemption and notice of acceptance of and demand for payment as to this Guaranty and also
waives notice of any default in the Obligations or of action taken in connection therewith. To the extent any
notice may not be legally waived, each Guarantor appoints the Tenant his or her attorney-in-fact for the
delivery of any notice, and any notice delivered to the Tenant shall be deemed received by each of the
Guarantor.
g, [)e1ayR WhivaM hv_I anrtinrd- No delay on the part of Landlord in exercising any rights
hereunder or under the Lease or any failure to exercise the same shall operate as a wavier of such rights; no
notice to or demand on the Guarantors shall be deemed to be a waiver of the obligations of the Guarantors or
of the right of Landlord to take further action without notice or demand as provided herein.
10. MnrlifnaM T Wnigar of this GuamnT No modification or waiver of the provisions of this
Guaranty, including the provisions of this paragraph, shall be effective unless in writing and signed by
Landlord; nor shall any waiver be applicable except in the specific instance for which it is given.
11. .SQU- of lnfnrmannn• The Guarantors warrant that they have adequate means to obtain
from the Tenant, Harr and on a continuing basis, all necessary and desirable information concerning the
status of the Obligations and the financial condition of the Tenant, and they are not relying on the Landlord to
provide such information, either now or in the future.
12. Finaaciai Infnminfinn• Upon Landlord's reasonable requests from time to time, each of the
Guarantors shall provide Landlord with financial information covering such periods and in such form as is
satisfactory to Landlord.
13. Modifications to I as- Landlord may make such modifications and additions to the Lease
and the Obligations as Landlord may deem advisable, including without limitation, extending the term of the
Lease, increasing or decreasing payments under the Lease, or allowing Tenant to assign or delegate its
duties under the Lease, and the some shall not release any Guarantor or in any way limit the liability of any
Guarantor, this Guaranty expressly extending to such modifications and extensions.
14. Nntices: Any notice or other communication required or permitted by this Guaranty shall be
in writing and shall be deemed given when hand delivered or deposited in the United States mail, postage
prepaid, via first class or certified mail, and addressed to the parties as follows:
If to Landlord: Alpha Omega, LLC
P. O. Box 3555
Camp Hill, PA 17011
With a copy to: Attorney Mark Thomas.
101 South Market Street
Mechanicsburg, PA 17055
If to Guarantor(s): Kenneth R. Paton
6B Round Ridge Road
Mechanicsburg, PA 17055
W. Douglas Waardenburg
2230 Canterbury Drive,
Mechanicsburg, PA 17055
With a copy to: Ralph H. Wright, Jr.
Johnson, Duffle, Stewart & Weidner
P.O. Box 109
Lemoyne, PA 17043-0109
Landlord's Initials: 4 Tenant's Initials:kv Page
?. t
CERTIFICATE OF SERVICE
I hereby certify that on this 30th day of January, 2009 a true and correct copy of
the foregoing Action for Declaratory Judgment has been served by the Cumberland
County Sheriff and first class mail, postage prepaid upon the follow:
Alpha Omega Unlimited, LLC
40 Tannery Road
York, PA 17019
R. Mark Thomas, Esquire
101 South Market Street
Mechanicsburg, PA 17055-3851
Rees Griffi s
PA 21896
Marisa G. Button
PA 206767
135 North George Street
York, PA 17401
717-848-4900
717-843-4903 fax
Attorneys for Zur, Ltd.
(00260564/1)
11
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1
{ _„ T ._TI
y
r
A
IN THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY,
PENNSYLVANIA
ZUR, LTD.,
2020 State Road
Camp Hill, Pennsylvania 17011
Plaintiff
V.
ALPHA OMEGA UNLIMITED, LLC
40 Tannery Road
Dillsburg, Pennsylvania, 17019
Defendant
Equity- Declaratory Judgment
EMERGENCY MOTION FOR TEMPORARY SPECIAL INJUNCTION AND
PRELIMINARY INJUNCTION
AND NOW this '-?) day of January 2009 comes Plaintiff, Zur Ltd., by
and through its duly appointed counsel, CGA Law Firm, and hereby moves this Court for
the entry of an Emergency Temporary Special Injunction and Preliminary Injunction,
restraining and enjoining Defendant, Alpha Omega Unlimited, LLC from entering and
taking possession of the Plaintiff s leased warehouse Premises located at 3825 Hartzdale
Drive, Camp Hill, Pennsylvania, 17011, and taking possession of any or all goods,
inventory, equipment, fixtures or any other personal property of Tenant which is located
in the leased premises, and further, to restrain and enjoin Defendant from conducting any
public or private sale of Plaintiff s goods, inventory, equipment, fixtures or any other
personal property of Tenant located in the leased premises, and/ or exercising any other
remedies for default under Paragraph 23.2 of the parties' Lease Agreement during the
pendency of Plaintiff s declaratory judgment action.
The nature of this Motion is emergent, as imminent harm is likely to result
upon Plaintiff filing the instant Emergency Motion for Temporary Special Injunction and
(00280496/1)
e
Preliminary Injunction, Verified Motion for Preliminary Injunction, and Verified Action
for Declaratory Judgment
2. The bases for the Emergency Motion are more fully set forth in Plaintiff's
Verified Motion for Preliminary Injunction and Memorandum of Law in Support, and
Plaintiff's Verified Action for Declaratory Judgment, each of which is attached hereto,
incorporated herein and filed contemporaneously herewith. A proposed form of Order is
annexed hereto.
3. Defendant has posted security in the form of previously escrowed and
disputed charges with the Cumberland County Prothonotary, and is prepared to post each
monthly disputed charge during the pendency of this matter.
Respectfully Submitted,
CGA LAW FIRM
Rees Griffiths
PA 21896
Marisa G. Button
PA 206767
135 North George Street
York, PA 17401
717-848-4900
717-843-4903 fax
Attorneys for Zur, Ltd.
(00280496/1)2
VERIFICATION
I hereby affirm that the following facts are correct. The attached Emergency
Motion for Temporary Special Injunction and Preliminary Injunction is based upon
information, which has been furnished to counsel in the preparation of this document.
The language of the attached Emergency Motion for Temporary Special Injunction and
Preliminary Injunction is that of counsel and not mine. I have read the attached
Emergency Motion for Temporary Special Injunction and Preliminary Injunction and to
the extent that the same is based upon information, which I have given to counsel, it is
true and correct to the best of my knowledge, information and belief. To the extent that
the content of the attached Emergency Motion for Temporary Special Injunction and
Preliminary Injunction is that of counsel, I have relied upon counsel in making this
Verification. I hereby acknowledge that the averments of fact set forth in the aforesaid
attached Emergency Motion for Temporary Special Injunction and Preliminary
Injunction are made subject to the penalties of 18 Pa. C.S. 4904 relating to unsworn
falsification to authorities.
Date: l 3 y By:
Ken Pa on
l By. ?.
Date:
Doug Waardenburg
(00280496/1)3
CERTIFICATE OF SERVICE
I hereby certify that on this 30'b day of January, 2009 a true and correct copy of
the foregoing Verified Emergency Motion for Special Injunction and Preliminary
Injunction has been served by the Cumberland County Sheriff and first class mail,
postage prepaid upon the follow:
Alpha Omega Unlimited, LLC
40 Tannery Road
York, PA 17019
R. Mark Thomas, Esquire
101 South Market Street
Mechanicsburg, PA 17055-3851
-V/-t eM ?
Rees Griffit s
PA 21896
Marisa G. Button
PA 206767
135 North George Street
York, PA 17401
717-848-4900
717-843-4903 fax
Attorneys for Zur, Ltd.
(00280496/1)4
C77 3
CO :=r
£? t
IN THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY,
PENNSYLVANIA
ZUR, LTD.,
2020 State Road
Camp Hill, Pennsylvania 17011
)\I Q, Plaintiff ??f - Sd 9 s
v.
ALPHA OMEGA UNLIMITED, LLC Equity- Declaratory Judgment
40 Tannery Road :
Dillsburg, Pennsylvania, 17019
Defendant
VERIFIED MOTION FOR PRELIMINARY INJUNCTION
AND NOW, this day of January 2009, comes Plaintiff, Zur Ltd., by and
through its under signed counsel, CGA Law Firm, and files this Verified Motion for
Preliminary Injunction and avers:
1. Plaintiff is engaged in the business of religious publication distribution.
(Affidavit)
2. Plaintiff conducts its distribution operations out of leased warehouse
space located at 3825 Hartzdale Drive, Camp Hill, Pennsylvania 17011.
3. Plaintiff's entire business inventory is located at the warehouse space.
4. The warehouse space is Plaintiff s sole facility for its nationwide
distribution operations.
5. Plaintiff leases its warehouse space from Defendant, Alpha Omega
Unlimited, LLC.
6. Plaintiff and Defendant signed the Lease Agreement for the warehouse
space in February, 2006, for a period of ten years.
7. In May, 2008, Plaintiff discovered that Defendant had been erroneously
overcharging Plaintiff for its share of Common Area Charges as Additional Rent. (See
Action for Declaratory Judgment)
8. After Defendant refused to rectify the Common Area Charge dispute,
Plaintiff began to escrow the disputed amount of Common Area Charge that Defendant
continued to charge Plaintiff with CGA Law Firm.
9. As a result, Defendant attempted to coerce Plaintiff into making the
disputed Common Area Charge payments by sending Plaintiff fraudulent lease default
notices in December 2008.
10. Defendant has threatened to exercise all remedies under Paragraph 23 of
the lease agreement if Plaintiff does not pay the erroneous Common Area Charges.
11. Plaintiff has concurrently filed an Action for Declaratory Judgment
regarding the Common Areas Charges dispute.
12. Defendants' remedies for an event of default include, inter alia,
Defendant's ability without judicial process, to enter and take possession of the Plaintiff's
leased warehouse premises, and take possession of any or all goods, inventory,
equipment, fixtures or any other personal property of Tenant which is located in the
leased premises.
13. Remedies also include Defendant conducting a public or private sale of
Plaintiff's goods, inventory, equipment, fixtures or any other personal property of Tenant
located in the leased premises.
14. If Defendant exercises its aforementioned remedies under the lease
agreement, Plaintiff will fundamentally be unable to operate its business.
(00280735/1) 2
15. Plaintiff will be unable to fill existing orders or execute new or existing
business contracts.
16. Plaintiff will lose business accounts and vendors as a result of its inability
to fill orders.
17. Plaintiff will lose its good name and business reputation in the community.
18. Said consequences to Defendant taking possession of Plaintiff's
warehouse and inventory, will have a devastating effect on Plaintiff business that will
result not only monetary damages, but inevitably the termination of the existence of
Plaintiff's business.
19. Accordingly, if Defendant exercises remedies for default under paragraph
23 of the Lease Agreement, said remedies will result in immediate and irreparable harm
to Plaintiff's business, necessitating the instant preliminary injunction.
20. Plaintiff subleases a portion of its warehouse space to the Harrisburg
Patriot News, and American Home Patient, a medical supply company that provides
oxygen tanks and equipment to local medical facilities and medical patients.
21. If Defendant exercises its remedies under the Lease Agreement, imminent
irreparable harm will result in that newspaper distribution to the public will cease, and
gravely ill patients will not receive the medical assistance they need.
22. A preliminary injunction will maintain the status quo in the instant
situation, while the declaratory judgment action regarding the Common Area charges is
determined.
23. Defendant will not suffer any injury if the instant preliminary injunction is
granted.
{00280775/1)
24. It is clearly in the public interest to grant the preliminary injunction.
25. Defendant has posted security in the form of previously escrowed and
disputed charges with the Cumberland County Prothonotary, and is prepared to post each
monthly disputed charge during the pendency of this matter.
WHEREFORE, Plaintiff, Zur, Ltd, respectfully requests judgment as follows:
1. That the Court temporarily and preliminarily restrain and enjoin
Defendant Alpha Omega Unlimited, LLC from taking possession of the premises of
Plaintiff and/or any or all goods, inventory, equipment, fixtures or any other personal
property belonging to Plaintiff, which is located within the leased premises during the
pendency of Plaintiff's declaratory judgment action..
2. That the Court temporarily and preliminarily restrain and enjoin
Defendant from conducting any public or private sale of Plaintiff's goods, inventory,
equipment, fixtures or any other personal property of Tenant located in the leased
premises during the pendency of Plaintiff's declaratory judgment action.
3. That the Court temporarily and preliminarily restrain and enjoin
Defendant from exercising any other remedies for default under Paragraph 23.2 of the
parties' Lease Agreement during the pendency of Plaintiff s declaratory judgment action.
4. That the Court issue a Rule to show Cause on Defendant to appear before
this Court for a hearing at a time and place to be designated to demonstrate why the
requested special temporary and preliminary injunction should not be continued.
5. That the Court permit Plaintiff to post security with the Prothonotary in
the form of escrowed and disputed Common Area Charges in lieu of bond.
(00280735/1) 4
6. That this Court grant such other and further relief as it deems just and
equitable.
Respectfully Submitted,
A CGA AW FI
Rees Griffit s
PA 21896
Marisa G. Button
PA 206767
135 North George Street
York, PA 17401
717-848-4900
717-843-4903 fax
(00290735n) 5
VERIFICATION
I hereby affirm that the following facts are correct. The attached Motion for
Preliminary Injunction is based upon information, which has been furnished to counsel in
the preparation of this document. The language of the attached Motion for Preliminary
Injunction is that of counsel and not mine. I have read the attached Motion for
Preliminary Injunction and to the extent that the same is based upon information, which I
have given to counsel, it is true and correct to the best of my knowledge, information and
belief. To the extent that the content of the attached Motion for Preliminary Injunction is
that of counsel, I have relied upon counsel in making this Verification. I hereby
acknowledge that the averments of fact set forth in the aforesaid attached Motion for
Preliminary Injunction are made subject to the penalties of 18 Pa. C.S. 4904 relating to
unsworn falsification to authorities.
Date: 30 O J By:
Ken n
Date: o By:
oug Waar urg
{00280735/1} 6
AFFIDAVIT OF KENNETH R. PATON
I, Kenneth R. Paton, being duly sworn according to law depose and state
as follows:
1. I am a member of Zur Ltd., ("Zur") which has its principal place of
business at 2020 State Road, Camp Hill Pennsylvania. I am fully familiar with the facts
and circumstances of this matter.
2. Zur is engaged in the business of religious publication distribution,
and has a warehouse located in Cumberland County.
3. Zur operates its national distribution operations solely out of its
warehouse.
4. Zur's warehouse is located at 3825 Hartzdale Drive, Camp Hill,
Pennsylvania, 17011.
5. Zur leases its warehouse space from Alpha Omega Unlimited,
LLC. Zur entered into the Lease Agreement for the warehouse space with Alpha Omega
Unlimited, LLC on February 10, 2006.
6. In May 2008, Zur discovered Alpha Omega Unlimited was
overcharging Zur for Common Area Charges.
7. To date, Zur and Alpha Omega Unlimited have been unable to
reach an agreement on the dispute regarding Common Area Charges.
8. Zur has been escrowing the amount of the disputed Common Area
Charges with CGA Law Firm.
9. On December 30, 2008, Alpha Omega Unlimited sent Zur lease
default notices for non-payment of the disputed Common Area Charges.
10. Alpha Omega Unlimited, LLC threatened to exercise remedies in
paragraph 23 of the Lease Agreement, if the erroneous Common Area charges were not
paid.
11. Under paragraph 23 of the Lease Agreement, upon an event of
default, Defendant may, among other things, take possession of Plaintiff's leased
premises and further, may take possession of all of Plaintiff's inventory located in the
warehouse.
12. Zur will suffer a termination of business operations if Alpha
Omega Unlimited exercises the default remedies under Paragraph 23 of the lease
agreement.
13. Zur will be unable to execute its existing business contracts or
access any of its inventory or supplies.
14. Zur's inventory shipments are time sensitive, and any delay will
result in customers seeking product from other suppliers, resulting in loss of immediate
sales, as well as future sales.
15. Zur subleases a portion of its warehouse space to the Harrisburg
Patriot News, and American Home Patient, a medical supply company that provides
oxygen tanks and equipment to local medical facilities and medical patients.
I swear under penalty of perjury under the laws of the Commonwealth of
Pennsylvania that the foregoing is true and correct.
O11 3 d e7
Date
Kenneth R. Paton
(00280766/1) 2
AFFIDAVIT OF W. DOUGLAS WAARDENBURG
I, W. Douglas Waardenburg, being duly sworn according to law depose
and state as follows:
1. I am a memberof Zur Ltd., ("Zur") which has its principal place of
business at 2020 State Road, Camp Hill Pennsylvania. I am fully familiar with the facts
and circumstances of this matter.
2. Zur is engaged in the business of religious publication distribution,
and has a warehouse located in Cumberland County.
3. Zur operates its national distribution operations solely out of its
warehouse.
4. Zur's warehouse is located at 3825 Hartzdale Drive, Camp Hill,
Pennsylvania, 17011.
5. Zur leases its warehouse space from Alpha Omega Unlimited,
LLC. Zur entered into the Lease Agreement for the warehouse space with Alpha Omega
Unlimited, LLC on February 10, 2006.
6. In May 2008, Zur discovered Alpha Omega Unlimited was
overcharging Zur for Common Area Charges.
7. To date, Zur and Alpha Omega Unlimited have been unable to
reach an agreement on the dispute regarding Common Area Charges.
8. Zur has been escrowing the amount of the disputed Common Area
Charges with CGA Law Firm.
9. On December 30, 2008, Alpha Omega Unlimited sent Zur lease
default notices for non-payment of the disputed Common Area Charges.
10. Alpha Omega Unlimited threatened to exercise remedies in
paragraph 23 of the Lease Agreement, if the erroneous Common Area charges were not
paid.
11. Under paragraph 23 of the Lease Agreement, upon an event of
default, Defendant may, among other things, take possession of Plaintiff's leased
premises and further, may take possession of all of Plaintiff's inventory located in the
warehouse.
12. Zur will suffer a termination of business operations if Alpha
Omega Unlimited exercises the default remedies under Paragraph 23 of the lease
agreement.
13. Zur will be unable to execute its existing business contracts or
access any of its inventory or supplies.
14. Zur's inventory shipments are time sensitive, and any delay will
result in customers seeking product from other suppliers, resulting in loss of immediate
sales, as well as future sales.
15. Zur subleases a portion of its warehouse space to the Harrisburg
Patriot News, and American Home Patient, a medical supply company that provides
oxygen tanks and equipment to local medical facilities and medical patients.
I swear under penalty of perjury under the laws of the Commonwealth of
Pennsylvania that the foregoing is true and correct.
a
Z:?
Date W. Douglas Waardenburg
(00280767/1) 2
CERTIFICATE OF SERVICE
I hereby certify that on this 30th day of January, 2009 a true and correct copy of
the foregoing Verified Motion for Preliminary Injunction has been served by the
Cumberland County Sheriff and first class mail, postage prepaid upon the follow:
Alpha Omega Unlimited, LLC
40 Tannery Road
York, PA 17019
R. Mark Thomas, Esquire
101 South Market Street
Mechanicsburg, PA 17055-3851
4""'?7
Rees Griffiths
PA 21896
Marisa G. Button
PA 206767
135 North George Street
York, PA 17401
717-848-4900
717-843-4903 fax
Attorneys for Zur, Ltd.
{00280735/1} 7
C. ?
rl
_ C': 17
-
ZUR, LTD,
Plaintiff
V.
ALPHA OMEGA
UNLIMITED, LLC,
Defendant
IN THE COURT OF COMMON PLEAS OF
CUMBERLAND COUNTY, PENNSYLVANIA
CIVIL ACTION - LAW
NO. 09-500 CIVIL TERM
IN RE: EMERGENCY MOTION FOR TEMPORARY
SPECIAL INJUNCTION AND PRELIMINARY INJUNCTION
ORDER OF COURT
AND NOW, this 3rd day of February, 2009, upon consideration of the above
motion, a hearing is scheduled for Wednesday, March 11, 2009, at 10:30 a.m., in
Courtroom No. 1, Cumberland County Courthouse, Carlisle, Pennsylvania.
BY THE COURT,
/Rees Griffiths Esq.
Marisa G. Button, Esq.
135 North George Street
York, PA 17401
Attorneys for Plaintiff
Mark Thomas, Esq.
101 South Market Street
Mechanicsburg, PA 17055-3851
Attorney for Defendant
:rc
a./ s ?og
j.
J esley Oler, Jr., J.
I Al,
9S .L !WIJ 9- 933 6001
ZUR, LTD., IN THE COURT OF COMMON PLEAS OF
Plaintiff CUMBERLAND COUNTY, PENNSYLVANIA
V. CIVIL ACTION - LAW
ALPHA OMEGA
UNLIMITED, LLC,
Defendant NO. 09-500 CIVIL TERM
: EMERGENCY MOTION F
INJUNCTION AND PRELIM
ORDER OF COURT
AND NOW, this 25t` day of February, 2009, upon agreement, of counsel, the
hearing previously scheduled in the above matter for March 11, 2009, is rescheduled to
Monday, March 23, 2009, at 1:30 p.m., in Courtroom No. 1, Cumberland County
Courthouse, Carlisle, Pennsylvania.
BY THE COURT,
ees Griffiths, Esq.
Marisa G. Button, Esq.
135 North George Street
York, PA 17401
Attorneys for Plaintiff
/Mark Thomas, Esq.
101 South Market Street
Mechanicsburg, PA 17055-3851
Attorney for Defendant
:rc
t ry
3
f
J : Wesley O , Jr.,
Lo :61 !V 92, 93A 60oz
SHERIFF'S RETURN - OUT OF COUNTY
CASE NO: 2009-00500 P
COMMONWEALTH OF PENNSYLVANIA:
COUNTY OF CUMBERLAND
ZUR LTD
VS
ALPHA OMEGA UNLIMITED LLC
R. Thomas Kline , Sheriff or Deputy Sheriff who being
duly sworn according to law, says, that he made a diligent search and
and inquiry for the within named DEFENDANT to wit:
ALPHA OMEGA UNLIMITED LLC
but was unable to locate Them
deputized the sheriff of YORK
in his bailiwick. He therefore
serve the within DECLARATORY JUDGMENT
County, Pennsylvania, to
On March 2nd , 2009 , this office was in receipt of the
attached return from YORK
Sheriff's Costs:
Docketing 18.00
Out of County 9.00
Surcharge 10.00
York County 72.50
Postage .42
1V. . ./G
03/02/2009
CGA LAW FIRM
Sworn and subscribe to before me
this day of
So answer
C
R. Thomas Kline
Sheriff of Cumberland County
A. D.
r?
? (?.. t? ?_ cry
ri
LH rr
u'iF c sU
iCL
Cam)
CIA
Iq
SERVICE CALL
(717) 771-9601
SHERIFF SERVICE M11=111C
PROCESS RECEIPT and AFFIDAVIT OF RETURN FIL TYPE CII LM 1 TWU 1
D4 MW DETACH MY tWft
1 PLAINTIFFIS/
ZUR Ltd.
3. DEFENDANTISI
Alpha Omega Unlimited LLC
2. COURT NUMBER
V7--)Vv U.LV11
4. TYPE OF WRIT OR COMPLAINT ORDER FOR HEM
SERVE 5 NAME OF INDIVIDUAL, COMPANY, CORPORATION, ETC TO SERVE OR DESCRIPTION OF P&0 Y1 1f $p,LrHV,rC1N ,gWLbF VER
Alpha Omega Unlimited LLC MOTION FOR PRELIMINARY I
- - ADDRESS (STREET OR RFO WITH BOX NUMBER, APT NO., CITY, B292 M
??? - ?ADe"T AT annery Road Dillsburg, PA 17019 'IF 7. INDICATE SERVICE, O PERSONAL O PERSON IN CHARGE XIXDEPUTIZE D ERT,MAIL O 1ST CLASS MAIL O POSTED O OTHER
NOW February 3 , 20 09 I, SHERIFF OF ?ICCOUNTY, PA, do hereby deputize the sheriff of
York COUNTY to execute thi;i I return the ording
to law. This deputization being made at the request and risk of the plaintiff., -?-?
SHERIFF OF LINTY
" !5
8. SPECIAL INSTRUCTIONS OR OTHER INFORMATION THAT WILL ASSIST IN EXPEDITING SERVICIbM OF CO. Cumbft,%aW,
ALW FEE PAID BY ATTY.
Please mail return of service to Clmberland County Sheriff. Thank you.
NOTE: ONLY APPLICABLE ON WRIT OF EXECUTION: N.B. WAIVER OF WATCHMAN - Any deputy sheriff levying upon or attaching any property under within writ may leave same
without a watchman, in custody of whomever is found in possession, after notifying person of levy or attachment, without liability on the part of such deputy or the sheriff to any plaintiff
herein for any loss, destruction, or removal of any property before sheriffs sale thereof.
9. TYPE NAME and ADDRESS of ATTORNEY! ORIGINATOR and SIGNATURE RE,ES GRIFFITHS, ESQ. 10. TELEPHONE NUMBER 11. DATE FILED
135 NORTH GEORGE STREET, YORK, PA 17401 17-848-4900 1-30-09
12. SEND NOTICE OF SERVICE COPY TO NAME AND ADDRESS BELOW: (This area must be completed d notice is to be mailed)
CUMBERLAND CO SHERIFF
SPACE G&OW FOR USE OF THE SHMW - 00 140T 0w1V Lmp II
13. 1 acknowledge receipt of the writ 14. DATE RECEIVED 15. Expiration/Hearing Date
or complaint as indicated above. MJ MCGILL YCSO 2-4-2009 2-2*-09
16. HOW SERVED: PERSONAL { ) RESIDENCE ( ) POSTED( ) POE( ) SHERIFF'S OFFICE ( ) OTHER SEE REMARKS BELOW
17. O certify and return a NOT FOUND because 1 am unable to locate the individual, company, etc. named above. (See remarks below.)
20 ime o g
AN"TW OF INDIVIO RVED /LIST ADgRtr? H?ER.E IF NOT '11 ? (Relationship to Defendant) JOT i AVANlirw
04 -2 Date I Time I Miles I Int. I Date I Time I Miles I Int. I Date
22.
Int. 1 Date I Time I Miles
23. Advance Costs 24
ice Costs 25. NIF 26. Mileage 27. Postage 28. Sub Total 29. Pound -M"" 31. Surchg. 32, Tot. Costs 33 Costs Due eland Check Nc
100.00 .S
1 . oo ,? A ,
34. Foreign County Coax 35. Advance Costs 36. Service Costs 37. Notary Cert. 38. MileagelPoshgeI Found 39. Total Costs 40. Costs Due or Re and
41. AFFIRMED and subscribed to me this 20t1i SO AIPOWE115
f 09
4
d M'
ep a
he
2,
ay o
43
I OF
KEY D
S
Mf
46. Signature of Y 4
d7. ATE
County Sherd
LISA L. R^, t?`?1f; i, Fa, !ir? °llBUC Z.I 3.?I' RI,T3_ a? :.IF J-20°09
CITY OF ` ,D7';C' 4'CiRK COUNTY 48. Signature of Foreign 49 DATE
N EY.PIRESAUG, 12, 2009 County Sheriff
50. 1 A SIGNATURE 51 DATE RECEIVED
OF AUTHORIZED ISSUING AUTHORITY AND TITLE
COUNTY OF YORK
OFFICE OF THE SHERIFF
45 N. GEORGE ST., YORK, PA 17401
1. WHITE - IssurrV Authority 2. PINK - Attorney 3. CANARY - Sheriffs Office 4. BLUE - SheWs Office
vu
.,A
ZUR, LTD., IN THE COURT OF COMMON PLEAS OF
Plaintiff CUMBERLAND COUNTY, PENNSYLVANIA
v CIVIL ACTION - LAW
ALPHA OMEGA UNLIMITED,
LLC,
Defendant 09-0500 CIVIL TERM
IN RE: RECORD TO REMAIN OPEN
ORDER OF COURT
AND NOW, this 23rd day of March, 2009, upon
consideration of the Emergency Motion for Temporary Special
Injunction and Preliminary Injunction, and following an initial
period of hearing, which has not yet been completed, the record
shall remain open, and counsel are requested to contact the
Court's secretary for purposes of scheduling an additional period
of hearing.
It is noted that at the time of adjournment on
today's date Plaintiff had completed its case-in-chief, and the
Defendant was presenting its case-in-chief. At the time of
adjournment on today's date Charles Fichtner was being subjected
to Cross Examination by Plaintiff's counsel, Reese Griffiths,
Esquire. It is further noted at the time of adjournment on
today's date Plaintiff had introduced Plaintiff's Exhibits 1, 2,
3, 4, and 5, and secured their admission, and Defendant had
introduced Defendant's Exhibits 1, 2, 3, 4, and 5, and secured
their admission. No other exhibits had been identified or
admitted.
At this time neither counsel has requested that
the notes of testimony from today's proceeding be transcribed and
filed.
By the Court,
/,eees Griffiths, Esquire
Marisa G. Button, Esquire
135 North George Street
York, PA 17401
For Plaintiff
Mark Thomas, Esquire
101 South Market Street
Mechanicsburg, PA 17055-3851
For Defendant
:mae 4
J Wesley 01 rvi. J.
pp J r ? A tt"??}
90 :1 d $iz 8vw bQOZ
ZUR, LTD.,
Plaintiff
V.
ALPHA OMEGA
UNLIMITED, LLC,
Defendant
IN THE COURT OF COMMON PLEAS OF
CUMBERLAND COUNTY, PENNSYLVANIA
CIVIL ACTION - LAW
NO. 09-500 CIVIL TERM
IN RE: EMERGENCY MOTION FOR TEMPORARY
SPECIAL INJUNCTION AND PRELIMINARY INJUNCTION
ORDER OF COURT
AND NOW, this 24`h day of March, 2009, a further period of hearing in the above
matter is scheduled for Monday, June 8, 2009, at 9:30 a.m., in Courtroom No. 1,
Cumberland County Courthouse, Carlisle, Pennsylvania.
BY THE COURT,
Aesley Oler,
ees Griffiths, Esq.
Marisa G. Button, Esq.
135 North George Street
York, PA 17401
Attorneys for Plaintiff
Mark Thomas, Esq.
101 South Market Street
Mechanicsburg, PA 17055-3851
Attorney for Defendant
:rc
A
tNilo
C 1.01 V SZ 8 Wb0OZ
IN THE COURT OF COMMON PLEAS OF
CUMBERLAND COUNTY, PENNSYLVANIA
CIVIL ACTION - LAW
ZUR, LTD.,
2020 State Road I
I
Camp Hill, Pennsylvania 17011
Plaintiff I
I
V. I Equity- Declaratory Judgment
I
ALPHA OMEGA UNLIMITED, LLC 09-500-civil
40 Tannery Road I
Dillsburg, Pennsylvania 17019
Defendant
NOTICE TO DEFEND
You have been sued in Court. If you wish to defend against the claims set forth in the
following pages, you must take action within twenty (20) days after this Complaint and
notice are served, by entering a written appearance personally or by attorney and filing in
writing with the Court your defenses or objections to the claims set forth against you.
You are warned that if you fail to do so the case may proceed without you and a
judgment may be entered against you by the Court without further notice for any money
claimed in the Complaint or for any other claim or relief requested by the Plaintiff. YOU
MAY LOSE MONEY OR PROPERTY OR OTHER RIGHTS IMPORTANT TO YOU.
YOU SHOULD TAKE THIS PAPER TO YOUR LAWYER AT ONCE. IF YOU DO
NOT HAVE A LAWYER, GO TO OR TELEPHONE THE OFFICE SET FORTH
BELOW TO FIND OUT WHERE YOU CAN GET LEGAL HELP. THIS OFFICE
CAN PROVIDE YOU WITH INFORMATION ABOUT HIRING A LAWYER.
IF YOU CANNOT AFFORD TO HIRE A LAWYER, THIS OFFICE MAY BE ABLE
TO PROVIDE YOU WITH INFORMATION ABOUT AGENCIES THAT MAY
OFFER LEGAL SERVICES TO ELIGIBLE PERSONS AT A REDUCED FEE OR NO
FEE.
Cumberland County Bar Association
32 Bedford Street
Carlisle, PA 17031
717-249-3166
(00291919/1)
EN LA CORTE DE ALEGATOS COMIJN DEL CONDADO DE CUMBERLAND
PENNSYLVANIA
DIVISION CIVIL
ZUR, LTD., i
2020 State Road i
Camp Hill, Pennsylvania 17011
Plaintiff
V.
Equity- Declaratory Judgment
i
i 09-500-civil
ALPHA OMEGA UNLIMITED, LLC
40 Tannery Road
Dillsburg, Pennsylvania 17019
Defendant
AVISO PARA DEFENDER
Conforme a PA RCP Num. 1018.1
USTED DEBE LLEVAR ESTE PAPEL A SU ABOGADO ENSEGUIDA. SI USTED
NO TIENE UN ABOGADO, VAYA O LLAME POR TELEFONO LA OFICINA
FIJAD AQUI ABAJO. ESTA OFICINA PUEDE PROVEERE CON INFORMACION
DE COMO CONSEGUIR UN ABOGADO.
SI USETED NO PUEDE PAGARLE A UN ABOGADO, ESTA OFICINA PUEDE
PROVEERE INFORMACI6N ACERCA AGENCIAS QUE PUEDAN OFRECER
SERVICIOS LEGAL A PERSONAS ELIGIBLE AQ UN HONORARIO REDUCIDO O
GRATIS.
Cumberland County Bar Association
32 Bedford Street
Carlisle, PA 17031
717-249-3166
(00291919/1) 2
IN THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY,
PENNSYLVANIA
ZUR, LTD.,
2020 State Road
Camp Hill, Pennsylvania 17011
Plaintiff
09-500-civil
v.
ALPHA OMEGA UNLIMITED, LLC
40 Tannery Road
Dillsburg, Pennsylvania 17019
Defendant
Equity- Declaratory Judgment
FIRST AMENDED ACTION FOR DECLARATORY JUDGMENT
AND NOW, comes Plaintiff, Zur Ltd, by and through its duly appointed
attorneys, CGA Law Firm, files the within First Amended Action for Declaratory
Judgment and in support thereof, avers as follows:
1. Zur Ltd., (hereinafter "Plaintiff") is a limited liability corporation
organized and existing under the laws of the Commonwealth of Pennsylvania, having its
principal office address at 2020 State Road, Camp Hill, PA 17011.
2. Defendant, Alpha Omega Unlimited, LLC (hereinafter "Defendant"), is a
limited liability corporation and existing under the laws of the Commonwealth of
Pennsylvania, having its principal office address at 40 Tannery Road, Dillsburg,
Pennsylvania, 17019.
(00291919/1} 3
COUNT I DECLARATORY JUDGMENT
3. The venue before this Court is proper pursuant to stipulation by the
parties.
4. On or about February 10, 2006, Plaintiff entered into a commercial lease
agreement with Defendant to lease warehouse space in a building located at 3825
Hartzdale Drive, Camp Hill, PA 17011, for a term of ten years. A true and correct copy
of said lease agreement is marked and attached hereto as Exhibit "A".
On or about February 10, 2006, Plaintiff entered into a commercial lease
agreement with Defendant to lease office space in a building located at 3825 Hartzdale
Drive, Camp Hill, PA 17011, for a term of three years. A true and correct copy of said
lease agreement is marked and attached hereto as Exhibit "B".
6. Plaintiff's total leased space, or pro-rata share, is 79.5% of the entire
building at Hatrzdale Drive (69%- warehouse, 10.5%- office space).
7. Paragraph 5(b) of both lease agreements (the "Leases") provides that
"Tenant shall pay as Additional Rent its pro-rata share of the cost of operating, replacing
improving, maintaining, repairing, and refurbishing the Common Areas ("Common Area
Charge"), which for the purposes of this Section only, shall include all roofs of the
Building."
8. The term "Common Areas" is defined in paragraph 2 of the Leases as
"... such parking areas, service roads, sidewalks, signs, equipment facilities, service areas,
(00291919/1) 4
hallways, doors, stairwells, and the like (the "Common Areas") as Landlord may from
time to time, make available to Tenant for use in common with others..."
9. So defined, the Common Areas occupy no more than 4% of the building
10. Paragraph 10) of the Leases provide that Plaintiff's pro-rata allocation of
the Common Area Charge is equal to Plaintiff s total leased space (69%- warehouse,
10.5%- office space).
11. Therefore the Common Area Charge attributed to Plaintiff is equal to
79.5% of the approximately 4% of the premises that are included as Common Area-or
about 3.2% of the expense to be allocated to Common Areas,
12. Paragraph 5(b) of the Leases identifies examples of includable costs in the
Common Area Charge for the Common Areas, including the materials, supplies
equipment, and services purchased or hired, as well as the heating, ventilation, and air-
conditioning of the enclosed areas of the premises other than the leased premises.
13. Paragraph 5(c) of the Leases establishes a Capital Improvement Fund, as it
acknowledges that Common Area Charge in 5(b) include the costs of repairs to the roof
and/or installation of a new room, resurfacing of parking lots, along with repairs and/or
replacement of the air conditioning unit(s) and heating system; and that such costs
may result in a substantial Common Area Charge. (emphasis ours)
14. The Capital Improvement Fund ("CIF") is funded by tenant contributions,
based on their pro-rata share of space in the Building and, for Plaintiff, set forth in
(00291919/1)
paragraph 1(k) of the Leases, equaling an aggregate annual contribution of $7,950.00,
paid monthly as Additional Rent.
15. Plaintiff has paid all Minimum Rent payments and Additional Rent
Payments, including those attributed to Common Area Charges, taxes, insurance, utilities
and CIF on time through October 2008.
16. Under the language quoted above, Plaintiff is responsible to pay 79.5% of
the cost of heating, cooling and ventilating the Common Areas, which cost may include
repairs, maintenance, or replacement ("HVAC Costs"). Accordingly, after 4% of the
total HVAC Costs are allocated to cover the cost of heating, cooling and ventilating the
Common Areas, Plaintiff is obligated to pay 79.5% of that 4% allocation.
17. In accordance with paragraph 5(c) of the Leases, Tenant is not liabile to
pay any HVAC Costs„ unless and until Landlord has exhausted the CIF Fund..
18. Upon reviewing Defendant's Common Area Charge accounting
statements for 2006 and 2007, Plaintiff discovered that Defendant was not paying the
HVAC Costs from the CIF.
19. Instead of deducting the costs of HVAC repair from the CIF Fund as
required by 5 (c), Landlord directly charged Plaintiff 79,5% of all HVAC repairs as
Common Area Charges. So far as Plaintiff can determine the CIF Funds were not only
not disposed of as required by the Leases, they were not used at all for HVAC repairs
20. Apart from violating the express provisions of 5 (c), Defendant charged
Plaintiff 79.5% of all HVAC Costs, as Common Area Charges, even though the Common
(00291919/1) 6
Areas, are less than 4% of the building space and the pro rata allocation of HVAC Costs
to Common Areas is therefore 4% of the total for the building.
21. Each month, the Defendant has divided the building's HVAC costs
according to each tenant's pro-rata share of the building and charged that amount as part
of the Common Area Charge, instead of determining what part of the HVAC Costs are
attributed to Common Areas of the building and charging each tenant it's pro-rata share
of that amount as Common Area Charge.
22. Because Defendant calculated HVAC Costs based on the Plaintiff's 79%
portion of the entire building, the charges include areas of the leased premises, which are
specifically excluded under paragraph 5(b). Further, Defendant failed to debit the CIF,
the account specifically established to cover such expenses, for the HVAC Costs.
23. In short, Defendant has required the Plaintiff each month to pay twice for
heating air conditioning and ventilating repairs once as part of the Common Area
Charge, and again as Plaintiff s contribution to the CIF.
24. Upon review of the Common Area Charge accounting statement, Plaintiff
also discovered that Defendant was improperly including costs of building improvements
for the benefit of the landlord, and a gas utility deposit related to natural gas utility
service turn-on for the entire building as Common Area Charge expenses.
25. Said expenses were made for the benefit of the Defendant as landlord of
the building, and not attributed to the Common Areas of the building as defined in
paragraph 2 of the Leases.
(00291919/1) 7
26. Said charges are not valid Common Area Charges under Paragraph 5(b) of
the Leases.
27. Defendant's increase to Plaintiff's Common Area Charges in 2006, 2007
and 2008 was based on the aforementioned improper Common Area Charges for prior
years.
28. Plaintiff made Additional Rent payments based on those improperly
included Common Area Charges.
29. Plaintiff is entitled to be credited for the overpayment of Common Area
Charges, paid as Additional Rent, it made to Defendant in 2006, 2007, and 2008.
30. When Plaintiff notified Defendant it was not calculating and allocating
expenses and Common Area Charges correctly, instead of correcting its mistake,
Defendant continued to overcharge Plaintiff for Additional Rent.
31. Further, when notified of its improper calculations and allocations,
Defendant attempted to force Plaintiff into paying twice for HVAC Costs sending a lease
default notice to Plaintiff and tacitly threatening to evict Plaintiff unless it acquiesced in
and agreed to pay the double-billed costs.
32. Because Defendant refused to acknowledge and rectify the improper
Common Area Charges, in November 2008 Plaintiff began to escrow a portion of the
Additional Rent attributed to Common Area Charges in the amount of $3,535.46 with
CGA Law Firm.
(00291919/1)
33. The escrowed $3,535.46 is the difference between what Defendant is
currently charging Plaintiff as Common Area Charges, and what the Plaintiff actually
owes as Additional Rent according to the provisions of the leases.
34. Plaintiff unsuccessfully attempted to work out an agreement with
Defendant regarding the allocation and applicability of the erroneous Common Area
Charges in dispute.
35. Defendant sent lease default notices to Plaintiff for the office and
warehouse leases by correspondence on or about December 31, 2008.
36. Among the lease defaults cited, Defendant included defaults for Plaintiff's
failure to pay Common Area Charges as Additional Rent in the amount totaling
$3,535.46 per month, the very amount of Additional Rent in dispute, which has been
escrowed with CGA Law Firm.
37. All of Plaintiff's alleged defaults under the Leases have been
cured/resolved with the exception of the instant Additional Rent dispute.
38. On or about January 30, 2009, Defendant's counsel sent correspondence to
Plaintiff that included a recalculation of Common Area Charges for 2009. A true and
correct copy of said letter is marked and attched hereto as Exhibit "C".
39. In said letter, Defendant claimed that it incurred a 2008 Common Area
Charge shortage in the amount of $14,448.61.
40. Defendant failed to provide Plaintiff with an accounting statement for
2008 Common Area Charges, as it required pursuant to paragraph 5(b) of the Leases.
(00291919/1) 9
41. Notwithstanding that fact that Defendant did not provide Plaintiff with a
2008 Common Area Charges accounting statement, Defendant is charging Plaintiff for
the calculated shortage of 2008 Common Area Charges amount as part of its 2009
Common Area Charges. Defendant's 2% increase for 2009 CAM is based on erroneously
calculated 2008 CAM rate.
42. In its January 30, 2009 letter, Defendant also included $12,0000 in
Plaintiff's 2009 Common Area Charges for the "Estimated PP & L increase" in 2009.
43. An estimated utility rate increase is not included in Common Area
Charges under paragraph 5(b) of the Leases. Tenant pays its pro-rata share of the electric
bill based on actual use on a monthly basis. PP&L rate cap does not expire until
12/31/2009
44. Plaintiff requests relief under the Pennsylvania Declaratory Judgment Act,
42 Pa.C.S. §7531, et sec.. by seeking a proper calculation of Common Area Charges in
accordance with the office and warehouse lease agreements between the parties.
45. An actual controversy of a judicial nature or the seeds of one ripening
exists between the parties as it pertains to Plaintiff s alleged defaults under the Leases for
its alleged failure to pay Additional Rent expenses.
46. Plaintiff, as tenant of the leased premises, desires to maintain its
warehouse lease agreement and without risking default under the agreement, but cannot
do so until the proper Common Area Charges calculation is determined with regard to the
office and warehouse leases.
(00291919/1) 10
47. Plaintiff has a definite and substantial interest in seeking a determination
of the lease agreements' Common Area Charges and CIF provisions so as not to default
on the lease and risk Defendant seeking remedies under the lease agreements.
48. Plaintiff has a definite and substantial interest in seeking a determination
of the Leases' Common Area Charges provisions so as to receive credit for its
overpayment of Additional Rent.
49. Plaintiff has a definite and substantial interest in seeking a determination
of the status of the CIF balance, which funds are held by Defendant as a fiduciary.
WHEREFORE, Plaintiff, Zur, Ltd. respectfully requests that this Honorable
Court issue an Order declaring:
i) Defendant shall base its calculation of Common Area Charges on
expenses related solely to the Common Areas of the building,
under Paragraph 2 and 5(b) of the office and warehouse lease
agreements.
ii) Defendant's calculation of Common Area Charges shall not be
based on the Plaintiff's pro-rata percentage of HVAC costs for the
entire building, but instead for the Plaintiff's pro-rata percentage of
HVAC costs for the Common Areas of the building.
iii) Defendant's allocation of Common Area Charges for HVAC Costs
shall be expenses paid from the Capital Improvement Fund
established in paragraph 5(c) of the Leases and funded by
{00291919/1} 11
Additional Rent paid by tenants.
iv) Defendant's calculation of Common Area Charges shall exclude
charges that are incurred solely for the benefit of Defendant as
landlord.
V) Defendant shall be required to submit a year-end accounting
statement to Plaintiff, reflecting the actual Common Area Charges
for that 12 month period pursuant to paragraph 5(b) of the Leases.
vi) All of Plaintiff's previous CAM Additional Rent overpayments
from 2006, 2007, 2008, and 2009 including a reasonable amount of
interest, shall be credited to Plaintiffs future Minimum Rent and
Additional Rent expenses under its warehouse lease.
Respectfully Submitted,
CGA LAW FI
Rees Griffiths
Marisa G. Button
PA 206767
135 North George Street
York, PA 17401
717-848-4900
717-843-4903 fax
Attorneys for Zur, Ltd.
{00291919/1} 12
ATTORNEY VERIFICATION
I, Marisa G. Button, Esquire, as an Officer of this Court, verify that the information
contained in this 1St Amended Complaint is true and correct. I further verify that I am making
this verification on behalf of Plaintiff, that the information contained in this I st Amended
Complaint are within my scope knowledge and that the statements made are true and correct to
my knowledge, information and belief.
This verification is made subject to the penalties of 18 C.S.A. § 4904 relating to unsworn
falsification to authorities. I am authorized to execute verifications on behalf of the Plaintiff.
CGA LAW FIRM
arisa u on, Esquire
ZUR, LTD.
Date: March 20, 2009
(00246711/1)
CERTIFICATE OF SERVICE
I hereby certify that on this 20th day of March, 2009 a true and correct copy of the
foregoing First Amended Action for Declaratory Judgment has been served by first
class mail, postage prepaid upon the follow:
Alpha Omega Unlimited, LLC
40 Tannery Road
York, PA 17019
R. Mark Thomas, Esquire
101 South Market Street
Mechanicsburg, PA 17055-3851
Rees Griffiths
PA 21896
Marisa G. Button
PA 206767
135 North George Street
York, PA 17401
717-848-4900
717-843-4903 fax
Attorneys for Zur, Ltd.
(00291919/1) 14
V
FEB 0 2 2009
R. MARK THOMAS
Attorney at Law,
101 South Market Street
Mechanicsburg, Pennsylvania 17055-3851
Telephone: (717) 796-2100
Telefax: (717) 796-3600
January 30, 2008
Zur, Ltd.
2020 State Road
Camp Hill, PA 17011
Re: . Warehouse Lease and Office Lease
3825 Hartzdale Drive, Camp Hill, Pennsylvania
Dear Zur, Ltd.:
Pursuant to Paragraph 5 (b) of the lease, please find enclosed herewith a statement
showing the actual Common Area Charges for 2008. Please note that "repairs and/or
replacement of the air conditioning units and heating system" charges are included as
clearly stated in Paragraph 5 (c). The total Common Area Charges for 2008 were
$147,352.99, which exceeded the Common Area Charges billed by $14,448.61. The
warehouse lease requires that 69% of the excess be paid over the twelve (12) months of
2009. Since the office lease expires at the end of February 2009, its share of the excess,
10.5%, is payable with February's rent. However, its share is reduced to reflect only two
(2) months of 2009.
Estimated Common Area Charges for 2009 have been calculated by adding an
approximate two per cent (2%) increase to the $147,352.99 which raises the amount
estimated to $150,000.00. In addition, due to the pending deregulation of utilities, the
electric bill is expected to increase dramatically. Therefore, $12,000.00 is being added to
the overall estimate to represent this expected increase. Landlord reserves the right to
recalculate this additional amount upward or downward depending upon the actual
increase in the cost of electricity.
s?
D
J
-2-
The following is the calculation formula:
2008 Actual CAM Charges $147,352.99
Shortage from 2008 to be collected in 2009 14,448.61
2% across the board estimated increase 2,647.01
Estimated PP & L increase 12. ,000..00
Estimated total for 2009 $176,448.61
Estimated Zur Warehouse at 69% 2009 CAM $121,749.54
Monthly CAM charges 10,145.80
Estimated Zur Office at 10.5% 2009 CAM 17,644.86
*Monthly CAM charges 1,543.92
*Lease expires 2/28/09, therefore total for 2009 is $3,087.84
Enclosed please find February 2009 invoices for the warehouse and the office.
Also, enclosed please find invoices for the unpaid rent which has been wrongfully
withheld by Zur, and the outstanding monies due from Zur to Landlord for monies paid
by Landlord to Artistic on behalf of Zur. Please note that penalties for late payment plus
interest will continue to accrue on the unpaid rent and the Artistic invoice.
Very truly yours,
e
R , yCG4 V04tt,&V
R. Mark Thomas
RMT/jlm
Enclosures
cc: Andrew Paxton, Esquire
Alpha Omega Unlimited, LLC
SENT VIA CERTIFIED MAIL
RETURN RECEIPT REQUESTED
AND REGULAR MAIL
I
January 30, 2009
Zur, Ltd.
2020 State Road
Camp Hill, PA 17011
February 2009 Office Lease Invoice
Basic Rent
Additional Rent:
CAM (January 2009)
Consideration for January CAM paid
CAM (February 2009)
Roof Fund
$5,000.00
$1,543.92
($484.90)
$1,543.92
$ 105.00
$7,707.94
Payment is due on February 1, 2009
January 30, 2009
Zur, Ltd.
2020 State Road
Camp Hill, PA 17011
February 2009 Warehouse Lease Invoice
Basic Rent
$10,000.00
Additional Rent
CAM (February 2009) $10,145.80
Roof Fund 690.00
$20,835.80
Payment is due February 1, 2009
January 30, 2009
Zur, Ltd.
2020 State Road
Camp Hill, PA 17011
jivoice for Uwai_d t
November 2008 $3,536.50 plus interest and penalties
December 2008 $3,536.50 plus interest and penalties
January 2009 $3.536.40 plus interest and penalties
$10,609.38 plus interest and penalties
Payment due on February 1, 2009
Zur, Ltd.
2020 State Road
Camp Hill, PA 17011
Amount paid on behalf of Zur, Ltd.
2006 Interest
2007 Interest
2008 Interest
2009 January Interest
Payment due February 1, 2009
January 30, 2009
Artistic Invoice
$15,918.80
549.52
988.10
1,047.39
92.52
$18,596.33
ry...?
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:'
IN THE COURT OF COMMON PLEAS OF
CUMBERLAND COUNTY, PENNSYLVANIA
CIVIL ACTION - LAW
ZUR, LTD.,
2020 State Road
Camp Hill, Pennsylvania 17011
Plaintiff
V.
ALPHA OMEGA UNLIMITED, LLC
40 Tannery Road
Dillsburg, Pennsylvania 17019
Defendant
Equity- Declaratory Judgment
09-500-civil
NOTICE TO DEFEND
You have been sued in Court. If you wish to defend against the claims set forth in the
following pages, you must take action within twenty (20) days after this Complaint and
notice are served, by entering a written appearance personally or by attorney and filing in
writing with the Court your defenses or objections to the claims set forth against you.
You are warned that if you fail to do so the case may proceed without you and a
judgment may be entered against you by the Court without further notice for any money
claimed in the Complaint or for any other claim or relief requested by the Plaintiff. YOU
MAY LOSE MONEY OR PROPERTY OR OTHER RIGHTS IMPORTANT TO YOU.
YOU SHOULD TAKE THIS PAPER TO YOUR LAWYER AT ONCE. IF YOU DO
NOT HAVE A LAWYER, GO TO OR TELEPHONE THE OFFICE SET FORTH
BELOW TO FIND OUT WHERE YOU CAN GET LEGAL HELP. THIS OFFICE
CAN PROVIDE YOU WITH INFORMATION ABOUT HIRING A LAWYER.
IF YOU CANNOT AFFORD TO HIRE A LAWYER, THIS OFFICE MAY BE ABLE
TO PROVIDE YOU WITH INFORMATION ABOUT AGENCIES THAT MAY
OFFER LEGAL SERVICES TO ELIGIBLE PERSONS AT A REDUCED FEE OR NO
FEE.
Cumberland County Bar Association
32 Bedford Street
Carlisle, PA 17031
717-249-3166
(00293466;1)
EN LA CORTE DE ALEGATOS COMUN DEL CONDADO DE CUMBERLAND,
PENNSYLVANIA
DIVISION CIVIL
ZUR, LTD.,
2020 State Road
Camp Hill, Pennsylvania 17011
Plaintiff
V.
ALPHA OMEGA UNLIMITED, LLC
40 Tannery Road
Dillsburg, Pennsylvania 17019
Defendant
Equity- Declaratory Judgment
i 09-500-civil
AVISO PARA DEFENDER
Conforme a PA RCP Num. 1018.1
USTED DEBE LLEVAR ESTE PAPEL A SU ABOGADO ENSEGUIDA. SI USTED
NO TIENE UN ABOGADO, VAYA O LLAME POR TELEFONO LA OFICINA
FIJAD AQUI ABAJO. ESTA OFICINA PUEDE PROVEERE CON INFORMACION
DE COMO CONSEGUIR UN ABOGADO.
SI USETED NO PUEDE PAGARLE A UN ABOGADO, ESTA OFICINA PUEDE
PROVEERE INFORMACION ACERCA AGENCIAS QUE PUEDAN OFRECER
SERVICIOS LEGAL A PERSONAS ELIGIBLE AQ UN HONORARIO REDUCIDO O
GRATIS.
Cumberland County Bar Association
32 Bedford Street
Carlisle, PA 17031
717-249-3166
[00293466/1) 2
IN 'THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY,
PENNSYLVANIA
ZUR, LTD.,
2020 State Road
Camp Hill, Pennsylvania 17011
Plaintiff 09-500-civil
v.
ALPHA OMEGA UNLIMITED, LLC Equity- Declaratory Judgment
40 Tannery Road
Dillsburg, Pennsylvania 17019
Defendant
SECOND AMENDED ACTION FOR DECLARATORY JUDGMENT
AND NOW, comes Plaintiff, Zur Ltd, by and through its duly appointed
attorneys, CGA Law Firm, files the within Second Amended Action for Declaratory
Judgment and in support thereof, avers as follows:
1, Zur Ltd., (hereinafter "Plaintiff") is a limited liability corporation
organized and existing under the laws of the Commonwealth of Pennsylvania, having its
principal office address at 2020 State Road, Camp Hill, PA 17011.
2. Defendant, Alpha Omega Unlimited, LLC (hereinafter "Defendant"), is a
limited liability corporation and existing under the laws of the Commonwealth of
Pennsylvania, having its principal office address at 40 Tannery Road, Dillsburg,
Pennsylvania, 17019.
{00293466/1) 3
COUNT I DECLARATORY JUDGMENT
3. The venue before this Court is proper pursuant to stipulation by the
parties.
4, On or about February 10, 2006, Plaintiff entered into a commercial lease
agreement with Defendant to lease warehouse space in a building located at 3825
Hartzdale Drive, Camp Hill, PA 17011, for a term of ten years. A true and correct copy
of said lease agreement is marked and attached hereto as Exhibit "A".
5. On or about February 10, 2006, Plaintiff entered into a commercial lease
agreement with Defendant to lease office space in a building located at 3825 Hartzdale
Drive, Camp Hill, PA 17011, for a term of three years. A true and correct copy of said
lease agreement is marked and attached hereto as Exhibit "B".
6. Plaintiff s total leased space, or pro-rata share, is 79.5% of the entire
building at Hatrzdale Drive (69%- warehouse, 10.5%- office space).
7. Paragraph 5(b) of both lease agreements (the "Leases") provides that
"Tenant shall pay as Additional Rent its pro-rata share of the cost of operating, replacing
improving, maintaining, repairing, and refurbishing the Common Areas ("Common Area
Charge"'), which for the purposes of this Section only, shall include all roofs of the
Building."
8. The term "Common Areas" is defined in paragraph 2 of the Leases as
"...such parking areas, service roads, sidewalks, signs, equipment facilities, service areas,
{00293466/1} 4
hallways, doors, stairwells, and the like (the "Common Areas") as Landlord may from
time to time, make available to Tenant for use in common with others..."
9. So defined, the Common Areas occupy no more than 4% of the building
10. Paragraph 10) of the Leases provide that Plaintiff's pro-rata allocation of
the Common Area Charge is equal to Plaintiff s total leased space (69%- warehouse,
10.5%- office space).
11. Therefore the Common Area Charge attributed to Plaintiff is equal to
79.5% of the approximately 4% of the premises that are included as Common Area-or
about 3.2% of the expense to be allocated to Common Areas,
12. Paragraph 5(b) of the Leases identifies examples of includable costs in the
Common Area Charge for the Common Areas, including the materials, supplies
equipment, and services purchased or hired, as well as the heating, ventilation, and air-
conditioning of the enclosed areas of the premises other than the leased premises.
13. Paragraph 5(c) of the Leases establishes a Capital Improvement Fund, as it
acknowledges that Common Area Charge in 5(b) include the costs of repairs to the roof
and/or installation of a new room, resurfacing of parking lots, along with repairs and/or
replacement of the air conditioning unit(s) and heating system; and that such costs
may result in a substantial Common Area Charge. (emphasis ours)
14. The Capital Improvement Fund ("CIF") is funded by tenant contributions,
based on their pro-rata share of space in the Building and, for Plaintiff, set forth in
{00293466/1) 5
paragraph 1(k) of the Leases, equaling an aggregate annual contribution of $7,950.00,
paid monthly as Additional Rent.
15. Plaintiff has paid all Minimum Rent payments and Additional Rent
Payments, including those attributed to Common Area Charges, taxes, insurance, utilities
and CIF on time through October 2008.
16. Under the language quoted above, Plaintiff is responsible to pay 79.5% of
the cost of heating, cooling and ventilating the Common Areas, which cost may include
repairs, maintenance, or replacement ("HVAC Costs"). Accordingly, after 4% of the
total HVAC Costs are allocated to cover the cost of heating, cooling and ventilating the
Common Areas, Plaintiff is obligated to pay 79.5% of that 4% allocation.
17. In accordance with paragraph 5(c) of the Leases, Tenant is not liabile to
pay any HVAC Costs„ unless and until Landlord has exhausted the CIF Fund..
18. Upon reviewing Defendant's Common Area Charge accounting
statements for 2006 and 2007, Plaintiff discovered that Defendant was not paying the
HVAC Costs from the CIF.
19. Instead of deducting the costs of HVAC repair from the CIF Fund as
required by 5 (c), Landlord directly charged Plaintiff 79,5% of all HVAC repairs as
Common Area Charges. So far as Plaintiff can determine the CIF Funds were not only
not disposed of as required by the Leases, they were not used at all for HVAC repairs
20. Apart from violating the express provisions of 5 (c), Defendant charged
Plaintiff 79.5% of all HVAC Costs, as Common Area Charges, even though the Common
{00293466/1) 6
Areas, are less than 4% of the building space and the pro rata allocation of HVAC Costs
to Common Areas is therefore 4% of the total for the building.
21. Each month, the Defendant has divided the building's HVAC costs
according to each tenant's pro-rata share of the building and charged that amount as part
of the Common Area Charge, instead of determining what part of the HVAC Costs are
attributed to Common Areas of the building and charging each tenant it's pro-rata share
of that amount as Common Area Charge.
22. Because Defendant calculated HVAC Costs based on the Plaintiff's 79%
portion of the entire building, the charges include areas of the leased premises, which are
specifically excluded under paragraph 5(b). Further, Defendant failed to debit the CIF,
the account specifically established to cover such expenses, for the HVAC Costs.
23. In short, Defendant has required the Plaintiff each month to pay twice for
heating air conditioning and ventilating repairs once as part of the Common Area
Charge, and again as Plaintiff's contribution to the CIF.
24, Upon review of the Common Area Charge accounting statement, Plaintiff
also discovered that Defendant was improperly including costs of building improvements
for the benefit of the landlord, and a gas utility deposit related to natural gas utility
service turn-on for the entire building as Common Area Charge expenses.
25. Said expenses were made for the benefit of the Defendant as landlord of
the building, and not attributed to the Common Areas of the building as defined in
paragraph 2 of the Leases.
100293466/1}
7
26. Said charges are not valid Common Area Charges under Paragraph 5(b) of
the Leases.
27. Defendant's increase to Plaintiff's Common Area Charges in 2006, 2007
and 2008 was based on the aforementioned improper Common Area Charges for prior
years.
28. Plaintiff made Additional Rent payments based on those improperly
included Common Area Charges.
29. Plaintiff is entitled to be credited for the overpayment of Common Area
Charges, paid as Additional Rent, it made to Defendant in 2006, 2007, and 2008.
30. When Plaintiff notified Defendant it was not calculating and allocating
expenses and Common Area Charges correctly, instead of correcting its mistake,
Defendant continued to overcharge Plaintiff for Additional Rent.
31. Further, when notified of its improper calculations and allocations,
Defendant attempted to force Plaintiff into paying twice for HVAC Costs sending a lease
default notice to Plaintiff and tacitly threatening to evict Plaintiff unless it acquiesced in
and agreed to pay the double-billed costs.
32. Because Defendant refused to acknowledge and rectify the improper
Common Area Charges, in November 2008 Plaintiff began to escrow a portion of the
Additional Rent attributed to Common Area Charges in the amount of $3,535.46 with
CGA Law Firm.
{00293466/11
33. The escrowed $3,535.46 is the difference between what Defendant is
currently charging Plaintiff as Common Area Charges, and what the Plaintiff actually
owes as Additional Rent according to the provisions of the leases.
34. Plaintiff unsuccessfully attempted to work out an agreement with
Defendant regarding the allocation and applicability of the erroneous Common Area
Charges in dispute.
35. Defendant sent lease default notices to Plaintiff for the office and
warehouse leases by correspondence on or about December 31, 2008.
36. Among the lease defaults cited, Defendant included defaults for Plaintiff's
failure to pay Common Area Charges as Additional Rent in the amount totaling
$3,535.46 per month, the very amount of Additional Rent in dispute, which has been
escrowed with CGA Law Firm.
37. All of Plaintiff's alleged defaults under the Leases have been
cured/resolved with the exception of the instant Additional Rent dispute.
38. On or about January 30, 2009, Defendant's counsel sent correspondence to
Plaintiff that included a recalculation of Common Area Charges for 2009. A true and
correct copy of said letter is marked and attched hereto as Exhibit "C".
39. In said letter, Defendant claimed that it incurred a 2008 Common Area
Charge shortage in the amount of $14,448.61.
40. Defendant failed to provide Plaintiff with an accounting statement for
2008 Common Area Charges, as it required pursuant to paragraph 5(b) of the Leases.
{00293466/1}
9
41. Notwithstanding that fact that Defendant did not provide Plaintiff with a
2008 Common Area Charges accounting statement, Defendant is charging Plaintiff for
the calculated shortage of 2008 Common Area Charges amount as part of its 2009
Common Area Charges. Defendant's 2% increase for 2009 CAM is based on erroneously
calculated 2008 CAM rate.
42. In its January 30, 2009 letter, Defendant also included $12,0000 in
Plaintiff's 2009 Common Area Charges for the "Estimated PP & L increase" in 2009.
43. An estimated utility rate increase is not included in Common Area
Charges under paragraph 5(b) of the Leases. Tenant pays its pro-rata share of the electric
bill based on actual use on a monthly basis. PP&L rate cap does not expire until
12/31/2009
44. Plaintiff requests relief under the Pennsylvania Declaratory Judgment Act,
42 Pa.C.S. §7531, et sec.. by seeking a proper calculation of Common Area Charges in
accordance with the office and warehouse lease agreements between the parties.
45. An actual controversy of a judicial nature or the seeds of one ripening
exists between the parties as it pertains to Plaintiff's alleged defaults under the Leases for
its alleged failure to pay Additional Rent expenses.
46. Plaintiff, as tenant of the leased premises, desires to maintain its
warehouse lease agreement and without risking default under the agreement, but cannot
do so until the proper Common Area Charges calculation is determined with regard to the
office and warehouse leases.
(00293466/1)
10
47. Plaintiff has a definite and substantial interest in seeking a determination
of the lease agreements' Common Area Charges and CIF provisions so as not to default
on the lease and risk Defendant seeking remedies under the lease agreements.
48. Plaintiff has a definite and substantial interest in seeking a determination
of the Leases' Common Area Charges provisions so as to receive credit for its
overpayment of Additional Rent.
49 Plaintiff has a definite and substantial interest in seeking a determination
of the status of the CIF balance, which funds are held by Defendant as a fiduciary.
WHEREFORE, Plaintiff, Zur, Ltd. respectfully requests that this Honorable
Court issue an Order declaring:
i) Defendant shall base its calculation of Common Area Charges on
expenses related solely to the Common Areas of the building,
under Paragraph 2 and 5(b) of the office and warehouse lease
agreements.
ii) Defendant's calculation of Common Area Charges shall not be
based on the Plaintiff's pro-rata percentage of HVAC costs for the
entire building, but instead for the Plaintiff's pro-rata percentage of
HVAC costs for the Common Areas of the building.
iii) Defendant's allocation of Common Area Charges for HVAC Costs
shall be expenses paid from the Capital Improvement Fund
established in paragraph 5(c) of the Leases and funded by
100293466/1)
11
Additional Rent paid by tenants.
iv) Defendant's calculation of Common Area Charges shall exclude
charges that are incurred solely for the benefit of Defendant as
landlord.
V) Defendant shall be required to submit a year-end accounting
statement to Plaintiff, reflecting the actual Common Area Charges
for that 12 month period pursuant to paragraph 5(b) of the Leases.
vi) All of Plaintiff's previous CAM Additional Rent overpayments
from 2006, 2007, 2008, and 2009 including a reasonable amount of
interest, shall be credited to Plaintiff's future Minimum Rent and
Additional Rent expenses under its warehouse lease.
Respectfully Submitted,
CGA AW FIRM
Rees Grif iths
Marisa G. Button
PA 206767
135 North George Street
York, PA 17401
717-848-4900
717-843-4903 fax
Attorneys for Zur, Ltd.
(00293466/1) 12
ATTORNEY VERIFICATION
I, Marisa G. Button, Esquire, as an Officer of this Court, verify that the information
contained in this 2nd Amended Action for Declaratory Judgment is true and correct. I further
verify that I am making this verification on behalf of Plaintiff, that the information contained in
this 2nd Amended Action for Declaratory Judgment are within my scope knowledge and that the
statements made are true and correct to my knowledge, information and belief.
This verification is made subject to the penalties of 18 C.S.A. § 4904 relating to unsworn
falsification to authorities. I am authorized to execute verifications on behalf of the Plaintiff.
CGA LAW FIRM
Marisa G. Button, Esquire
Zur, LTD
Date: April 1, 2009
(00246711/1}
EXHIBIT
A
SCANNED
LEASE AGREEMENT for Space at 3825 Hartzdale Drive, Camp Hill, PA 17011
THIS LEASE AGREEMENT ("Lease") is made this LO day of February, 2006, between
Landlord: Alpha Omega Unlimited, LLC with contact address as 49 Tannery Road, Dillsburg, PA 17019
Tenant: Zur LTD, with contact address as 2230 Canterbury Drive, Mechanicsburg, PA, 17055.
WITNFSgpTH:
1. DefinWom. The following definitions shall apply to the indicated terms, whenever used in
this Lease. Additional defined terms may be found in the body of the Lease.
(a) Landlord: Alpha Amon I Inlimitarl I I r
do Gbades Vir- Firhfnar
dQ Tannan o a
t ftburn - 17n1Q
(b) Tenant: 7I fR 1 Tn
2230 Canterbury Drive
Mechanicsburg, PA 17055
(c) Leased Premises: Approx 3fl 775 square feet
(d) Permitted Use: Warehouse
(e) Lease Commencement Date: 3/1/2006
All prorata CAM, Taxes and Insurance charges are due beginning on the lease commencement date.
(f) Rent Commencement Date: 2110/2006
(g) Term. - In - - years n
months
(h) Minimum Rent: $10,000 per month with no increase for the term of the lease.
(i) Renewal Options: 5 Year Option to renew at $15,000 per month.
See Option Rider, if applicable. All Renewal Periods shall be included in the definition of the Term.
(i) Percentage of Common Area Charge ("CAM"): 69%
Initial Annual Amount: ($12,000.00) $8260/Year
(k) Percentage of Capital Improvements Fund 69%
Initial Annual Amount: 12,5gg.815 ) 686"1yEV
(1) Security Deposit: 6)
(m) Insurance Payment ("Ins."): f 69%
Initial Annual Amount ($5,000.00)
$3450/year
(n) Tax Payment ('Tax"): 69%
Initial Annual Amount: ($40,000.00)
$27,600/year
(rr +rww
6 9 ¢?rs/nl C a3? Notices: To Landlord: Alpha Omega
95,v0? d ?'
P. O. Box 3555 W C
Camp Hill, PA 17011
With a copy to:?
Attorney Mark Thomas
1n1 Rnnth MarVat Rfrnnf
With a copy to: Ralph H. Wright, Jr.
Johnson, Duffie, Stewart
Weidner
P.O. Box 109
Lemoyne, PA 17043-0109
(p) Attachments: Exhibit A - Floor Plan
Exhibit B - Signage Criteria
Exhibit C - Rules and Regulations
Exhibit D - Delivery of Documents
Exhibit E - Build Out Rider
Exhibit F - Guaranty
PrPmicPC,
Dear. ' Lion of Prpmiapa Landlord leases to Tenant, and Tenant leases from Landlord, the
Leased Premises described in Section 1. The Leased Premises is outlined. in red on a diagram of the
Building attached hereto and incorporated herein as Exhibit "A." Exhibit "A" sets forth the general layout of
the Building and shall not be deemed a warranty on the part of Landlord that the Building is or will be exactly
as indicated on such diagram. Landlord may increase, reduce, or change the number, dimensions, and
locations of roadways, walks, buildings, and parking areas as Landlord from time to time deems proper.
Tenant's occupancy of the Leased Premises shall include the use in common with others entitled thereto of
such parking areas, service roads, sidewalks, signs, equipment facilities, service areas, hallways, doors,
stairwells, and the like (the "Common Areas") as Landlord may from time to time, make available to Tenant
for use in common with others, subject, however, to the terms and conditions of this Lease and to all rules
and regulations for the use thereof as may from time to time be prescribed by Landlord.
3, Ltae of I eased Premises- Name, The Leased Premises shall be used solely for the
Permitted Use indicated in Section 1, and for no other purpose. Tenant shall operate such a business in the
Leased Premises at all times during the Term. Tenant shall conduct its business in the Leased Premises
under its Legal name of the Trade Name indicated in Section 1. Tenant shall not change its Trade Name or
Legal name without prior notice to Landlord.
4. Ierm. The Initial Term of this Lease shall begin on the "Lease Commencement Date" , so
set forth on page 1 of this Lease unless otherwise stated here. The phrase "Term" as used in this Lease
shall mean the Initial Term and all renewal terms (if there are any) exercised.
5. Bent.
(a) Minimilm Rent, Tenant shall pay, as rent for the Leased Premises, the Minimum Rent
indicated in Section 1. If the Commencement Date is not the first day of the month, rent for that month shall
be prorated. If any rent or other sum is not received by Landlord within ten (10) calendar days after its due
date, Tenant shall pay a late charge of ten percent (10%) of the overdue amount. If any payment under this
Lease is made by check and such check is returned by the payor for any reason, Tenant shall pay a returned
check charge of One Hundred Dollars ($100.00). In addition, any rent or other sum not received by Landlord
when due shall bear interest from the due date to the payment date at the prime rate published from time to
time by the Wall Street Journal, plus two (2%). Landlord reserves the right to require cashier's check,
certified check, money order, or cash, and may refuse Tenant's check in Landlord's sole discretion.
(b) rnmmnn Area rhalrge, Tenant shall pay as Additional Rent its pro-rata share of the cost of
operating, replacing improving, maintaining, repairing, and refurbishing the Common Areas ("Common Area
Charge"), which for purposes of this Section only, shall include all roofs of the Building. Such costs shall
include, without limitation, materials, supplies, equipment, and services purchased or hired; equipment used
for the maintenance of the Common Areas; landscaping, gardening, planting, cleaning, painting, striping
parking areas, repaving, lighting, and sanitation; removing snow, ice, and garbage; heating, ventilating, and
air-conditioning the enclosed areas other than the Leased Premises; fire protection and on-site security if
provided by Landlord in its sole discretion), water and sewage charges, storm water maintenance fees,
electricity and other utility services; costs of personnel, payments to governmental authorities, costs of
complying with rules and regulations of governmental authorities, Fire Insurance Rating Organizations, Board
of Fire Underwriters, insurance carriers, and other organizations having jurisdiction over the Building; and
Landlord's administrative costs (including any management fee payable by Landlord) in connection with the
operation of the Building ("Common Area Costs"). Landlord and Tenant agree that improvements performed
to the front of the RliiWinn nrimarii.r fnr tho honofit of fho rofa it enro rurronfhr {rnmmn me Qonianf`e W-rf eknll
commencing and ending on dates designated by Landlord, each installment being due on the first day of
each calendar month. At any time during any such twelve (12) month period, Landlord may re-estimate
Tenant's proportionate share of the Common Area Charges and thereafter adjust Tenant's monthly
installments payable during such twelve (12) month period to reflect more accurately Tenant's proportionate
share of the Common Area Charges. At the end of each twelve (12) month period, Landlord shall deliver to
Tenant a statement of the actual Common Area Charges for that twelve (12) month period. For the next
twelve (12) months, the monthly Common Area Charges will be adjusted to reflect the actual Common Area
Charges for the preceding twelve (12) months, plus the deficiency in Common Area Charges for the
preceding twelve (12) months based upon Tenant's proportionate share of that deficiency. Tenant shall have
the option to pay its entire proportionate deficiency within thirty (30) days should Tenant so choose. At the
end of the initial term, or any renewal thereof, Tenant will pay its proportionate share of any deficiency within
twenty (20) days following receipt of notice from Landlord of the Tenant's proportionate share. If , at the end
of any twelve month period, Tenant has paid more than Tenant's proportionate share of the actual Common
Area Charges for such period, such overage shall be credited as a payment toward Tenant's, proportionate
share of Common Area Charges for the following twelve month period. Upon reasonable notice, Landlord
shall make available for Tenant's inspection (which inspection shall be at Tenant's sole cost and expense) at
Landlord's office, during normal business hours, Landlord's records relating to the Common Area Charges for
such preceding twelve (12) month period. Failure of Landlord to provide the statement called for hereunder
within the time prescribed shall not relieve Tenant from its obligations hereunder.
(c) Capital Improvements Fund. The Common Area Charge, subsection (b) above, includes
the costs of repairs to the roof and/or installation of a new roof, resurfacing of parking lots, along with
repairs and/or replacement of the air conditioning unit(s) and heating system. These four (4) items could
result in a substantial "Common Area Charge" for the year in which any of these items would need to be
replaced. Therefore, a Capital Improvements Fund, (hereinafter the "Fund"), limited in purpose to the roof,
parking lot air conditioning unit(s) and heating system shall be established. Tenant shall pay as Additional
Rent its pro-rata share of the Capital Improvements Fund on a monthly basis. The Fund is hereby capped
at $120,000.00, which amount is to be accumulated over a ten (10) year period. The determination of the 1
need for Capital improvements to the four (4) items listed above shall be at the sole discretion of Landlord. M!'
If expenditures from this Fund in any one (1)
year shall exceed the account balance of this Fund, Tenant's monthly pro rata payments to this Fund shall
be increased to make up the deficiency during the following twelve (12) months. If Tenant's initial term,
and any renewals thereof, shall expire before any expenditures are made from this Fund, Tenant shall not
be entitled to a refund of any contributions it has made to the Capital Improvement Funds. However,
should Landlord sell the real property herein to any third party not in any way related to Landlord, or its
members, Tenant shall be entitled to repayment of all its contributions to the Fund, minus ten (10%)
administration fees, plus its pro rata share of interest actually earned and accumulated in the Fund, minus
ten (10%) administration fees.
(d) Tares. During the Term, Tenant shall pay as Additional Rent a prorata portion of the annual
real estate taxes assessed against the Building $ Property, as stated in Gpnfinn ciihcprtinn ( m) above. All
taxes assessed prior to the Term but payable in whole or in installments after the Commencement Date, and
all taxes assessed during the Term but payable in whole or in installments after the Term, shall be adjusted
and prorated, so Tenant shall pay its prorata share for the Term and Landlord shall pay its prorata share for
the periods prior and subsequent to the Term. If at any time during the Term, under the Laws of the state in
which the Building is located or any political subdivision thereof, a tax on rents is assessed against Landlord
in the form of a license tax or otherwise, such tax shall be deemed a real estate tax and shall be included
within the amount Tenant is required to pay. Tenant's prorata share of Real Estate Taxes may be reviewed,
adjusted and billed in the same manner set forth in Section 5, subsection (c) above.
(e) Crimpptitiinn by Tenant Tenant shall not directly or indirectly engage in any similar or competing
business to that conducted by Tenant in the Leased Premises within a radius of five (5) miles from the
Leased Premises. If Tenant violates this covenant, then in addition to all other remedies available to
Landlord, Tenant's gross sales in such similar or competing business shall be deemed Gross Sales and shall
be reported under this Section 5 for the period in which made, and Percentage Rent shall be calculated
thereon. For purposes of this subsection, Tenant shall be deemed to be indirectly engaging in a similar or
competing business if a stockholder or partner of Tenant, or Tenant, if an individual, or any family member of
any of the foregoing, shall have a financial interest in such similar or competing business or if, with Tenant's
consent, such similar or competing business is conducted under the same trade name as the business
conducted in the Leased Premises. (This section (e) does not include business currently being done by
tenant under e-church depot (sale of church-related products and Christian literature ,) AFIRM - consignment
product placing, and Wingspread Publishers (publication of Christian Literature); these business practices
(innp tinripr fpnanf 71 IR 1 Tn 1
Lease or in writing, all payments of Minimum Rent and Additional Rent shall be payable monthly in advance
on or before the first day of each month during the Term, without prior demand and without offset, reduction,
defense, or counterclaim All payments shall be made prior to the close of business (Eastern Standard Time)
on the date specified for such payment and in immediately available United States funds.
Security Deposit: (None)
8. Trade Fiytuims. Tenant shall have the right to install its trade fixtures in the Leased Premises,
provided such installation shall not interfere with either the construction of the Building or the completion of
any improvements to the Leased Premises which Landlord may have specifically agreed in this Lease to
perform, and such installation shall be at the sole risk and expense of Tenant. All trade fixtures installed in
the Leased Premises by Tenant shall remain the property of, and shall be removable by, Tenant at the
expiration of the Term, provided Tenant is not in default under this Lease, and Tenant shall promptly repair,
or reimburse Landlord for the cost of repairing all damages to the Leased Premises caused by the removal of
those fixtures.
9. C:notml of r:nmmnn Areas an Farititipcz by I anrilord. The Common Areas shall at all times
be subject to the exclusive control and management of Landlord, and Landlord shall have the right, from time
to time, to establish, modify, and enforce reasonable rules and regulations with respect to the Common
Areas. Without limiting the foregoing, Landlord shall have the right to construct, maintain, and operate
lighting facilities on all Common Areas; to police the same; to change, in Landlord's sole discretion, the area,
level, location, quantity, and arrangement, from time to time, of the Common Areas; to close or discontinue
common use of all or any portion of the Common Areas to such extent as may, in the opinion of Landlord or
Landlord's counsel, be legally sufficient, necessary, or proper to prevent a dedication or the accrual of any
rights to any person or the public; and to do and perform such other acts in and to the Common Areas as
Landlord, in its sole discretion, determines to be necessary to improve the convenience and use thereof by
tenants or their officers, agents, employees, and customers, or to improve the profitability of the Building.
Landlord will operate and maintain the Common Areas in such manner as Landlord, in its sole discretion,
shall determine from time to time. Without limiting the scope of such discretion, Landlord shall have the full
right and authority to employ all personnel and to make all rules and regulations pertaining to the proper
operation and maintenance of the Common Areas and facilities.
10, t lce of Parking Areas.
(a) All automobile parking areas, driveways, entrances, and exits in or near the Building,
and other facilities furnished by Landlord in or near the Building, shall at all times be subject to Landlord's
exclusive control and management, and Landlord shall have the right from time to time to establish, modify,
and enforce reasonable rules and regulations with respect to all such facilities and areas.
(b) It is expressly understood that the parking areas in the Common Areas are intended
primarily for use by the Servant's Heart Retail Customers in the Building, and Tenant accordingly agrees that
its employees will not use those parking areas or any of the driveways, streets, or vacant land in the Building
for parking or storing any automobile, truck, or any other vehicle owned or used by any such employee,
except as Landlord may from time to time approve in writing, and with the further exception that Tenant, to
include Tenant's employees, may use the parking spaces in front of the building which are most remote from
the main entrance to the Servant's Heart Store in the event that parking elsewhere on the land adjacent to
the Building is unavailable, until such time as additional parking is made available on said land.
(c) Parking area in front of building is available expressly for retail customer use. Parking
for office employees is to be along the side of the building by receiving, except as provided otherwise in
Paragraph 10 (b). (Exceptions in the cases of any employees holding handicap passes.)
11. Maintmanca by I_ gridinrri. Landlord shall, within a reasonable time after having received
written notice from Tenant of such a need, make such repairs to the roof, outside walls (except window,
storefront, and doors), gutters, and downspouts of the Building as may be necessary to keep the Building in
good condition and repair unless such repairs are caused by the negligence or willful act of Tenant or any of
its agents, employees, or contractors, in which event such repairs shall be made by and at the expense of
Tenant. Landlord will not be responsible for any damage resulting from any leak or defect in the roof,
sidewalls, gutters, or downspouts unless such damage is due to Landlord's failure to repair such defect within
a reasonable time after Landlord has received notice from Tenant of the need to repair such defect. Landlord
shall maintain In good condition and repair, and adequately light, the parking areas of the Building.
12. Mainfenanrn her Tenant.
all repairs and replacements necessary to keep the Leased Premises and the appurtenances thereto in good
condition and repair except only those repairs which Landlord has expressly agreed under this Lease to
make. Tenant shall, at its own cost and expense, keep the Leased Premises and entryways, sidewalks,
driveways, and delivery areas adjacent to the Leased Premises clean and free from obstruction, garbage,
dirt, snow, and ice. Tenant shall store all garbage in fully-closed containers in the area designated by
Landlord, and Tenant shall pay all costs incident to the removal thereof. Tenant shall not burn or otherwise
dispose of any garbage in or about the Leased Premises. Tenant shall not tape windows or attach wood
coverings to aluminum frame windows.
13. Sunrinj Covenants of Tenanr, Tenant shall: (a) comply with all federal, state, and municipal
laws, ordinances, and regulations relating to the Leased Premises and its Permitted Use, including, without
limitation, all environmental laws, rules and regulations (collectively the "Environmental Laws") and all laws,
rules and regulations in connection with the Americans with Disabilities Act of 1990, as amended (the "ADA");
(b) notify Landlord immediately upon receipt of all notices or other communications by governmental
authorities regarding possible or actual noncompliance with laws, ordinances, or regulations; (c) pay promptly
for all electricity, water, and other utilities consumed on or in connection with the Leased Premises, and all
sewage disposal charges assessed against the Leased Premises; (d) not use or permit to be used any
advertising medium or device, such as phonograph, radio, or public address system (except for the public
address / intercom system which serves the interior of the Leased Premises), without Landlord's prior written
consent; (e) not use or permit to be used the Leased Premises for any illegal or immoral purpose; (f) not hold
any fire, bankruptcy, going out-of-business, or auction sales without Landlord's prior written consent; (g) not
use the sidewalks or any other portions of the Common Areas for any purpose relating to the selling of
merchandise or services; and (h) keep the Leased Premises free from insects, pests, and vermin of all kinds,
and for that purpose Tenant shall use, at Tenant's cost, such pest extermination contractor as Landlord may
direct and at such intervals as Landlord may require.
The Leased Premises shall not be used for the treatment, storage, use, or disposal of toxic or
hazardous wastes or substances, or any other substance, exposure to which is prohibited, limited, or
regulated by a governmental or quasi-govem mental authority or which, even if not so regulated, could or
does pose a hazard to the health and/or safety of the occupants of the Building or surrounding property.
Tenant shall indemnify and hold Landlord harmless from and against any expense or liability (including
attorney's fees) arising under the Environmental Laws resulting from Tenant's use of the Leased Premises or
any acts and/or omissions of Tenant, its agents, employees, invitees, or independent contractors.
14, Cmnrn?_ v ments.
Tenant is accepting the Leased Premises "as is", and Tenant shall pay the cost of any improvements
or alterations desired by Tenant. Any such improvements or alterations to the Leased Premises shall be
performed only after Tenant has obtained the prior written consent of Landlord, which consent may be
withheld for any or no reason. Tenant has inspected the Leased Premises and is satisfied with its physical
condition. Any improvements or alterations to the Leased Premises in addition to those specified on the
Build-out Rider shall be performed at Tenant's expense, and only after Tenant has obtained the prior written
consent of Landlord, which consent may be unreasonably withheld.
15. Compliance with AmanCans; ifh n;can;imP? Anr of 1 AQ0 Tenant acknowledges it is a
"public accommodation" as defined by the ADA. If the ADA requires that action be taken with respect to the
Leased Premises (not including the Common Areas), including without limitation removing barriers and
altering the Leased Premises in accordance with the ADA Accessibility Guidelines, such action shall be taken
by Tenant; provided, however, that if such action was required to be taken during Landlord's build-out (if
applicable) of the Leased Premises, Landlord shall take such action. Tenant shall notify Landlord
immediately upon receipt of an oral or written complaint or notice by an employee, customer, client, invitee,
licensee, or governmental authority regarding the ADA.
16. Assi?nnPnt and Suhet+-. Without Landlord's prior written consent, Tenant shall not
(either voluntarily, involuntarily, or by operation of Law) assign, transfer, mortgage, pledge, hypothecate, or
encumber this Lease or any interest under this Lease; nor sublet or grant concessions of or to the Leased
Premises, in whole or in part; nor allow any person (other than Tenant, its employees, agents, servants, and
invitees) to occupy or use all or part of the Leased Premises. Landlord's consent may be withheld for any or
no reason. Regardless of any such consent, no assignment or subletting shall release Tenant of its
obligations or alter the primary liability of Tenant to pay rent and perform all its other obligations under this
Lease. Landlord's consent to one assignment, subletting, occupation, or use by any other person shall not
be deemed a consent to any subsequent assignment, subletting, occupation, or use by another person. The
transfer of fifty percent (50%) or more of Tenant's stock, if Tenant is a corporation, or the transfer of fifty
percent (5o%) or more of a partnership interest in Tenant, if Tenant is a partnership, shall constitute an
assianment nnrior tho forme of fhie i ooea
square foot of the sublet portion of the Leased Premises exceeds the rental rate per square foot of this
Lease, then Tenant shall pay to Landlord each month, together with the rent due under this Lease, an
amount equal to one half (112) of the amount by which the rent due under the sublease exceeds the rent
which would be due for the sublet space under the terms of this Lease, computed on a per square foot basis.
17. Gnodemoatioo. If the whole or any part of the Leased Premises shall be taken by power of
eminent domain or condemned by any competent authority for any public or quasi-public use or purpose, or if
any adjacent property or street shall be so taken or condemned, or reconfigured or vacated by such authority
in such manner as to require the use, reconstruction, or remodeling of any part of the Leased Premises, or if
Landlord shall grant a deed or other instrument in lieu of such taking by eminent domain or condemnation,
Landlord (and if more than ten percent (10%) of the rentable area of the Leased Premises is taken, or if
access to the Leased Premises or any common restrooms serving the same is materially impaired) Tenant
shall have the option to terminate this Lease upon ninety (90) days notice, provided such notice is given no
later than one hundred eighty (180) days after the date of such taking, condemnation, configuration, vacation,
deed, or other instrument. Landlord shall be entitled to receive the entire award or payment in connection
therewith, and Tenant waives any right it may have to any such award or payment. All rent shall be
apportioned as of the date of such termination or the date of such taking, whichever shall first occur. If any
part of the Leased Premises shall be taken, and this Lease shall not be so terminated, the rent shall be
proportionately abated.
18. rmcnage by Fire nr Other r__an malty. If the Leased Premises or a substantial portion of the
Building is damaged by fire or other casualty during the Term, Landlord may, at its sole option, either (i)
restore the Leased Premises with reasonable dispatch to substantially the same condition they were in prior
to such damage, insofar as the proceeds from Landlord's insurance permit, or (ii) terminate this Lease. If
Landlord elects to restore the Leased Premises, Landlord shall have no liability to restore any improvements
as may have been made to the Leased Premises, whether before or after the date of this Lease, nor to
restore any of Tenant's fixtures, decorations, equipment, furniture, or inventory. Landlord's sole
responsibility, if any, shall be to deliver to Tenant a shell space with roof, floor, exterior walls, windows, and
doors. If the Leased Premises are rendered untenable in whole or in part as a result of such damage and
this Lease is not terminated, the Minimum Rent and Additional Rent payable shall be equitably and
proportionately abated (according to loss of use) during the period intervening between the date of such
damage and the date the Leased Premises are restored. If Landlord elects to terminate this Lease, all rent
payable shall be abated as of the date of such damage and Tenant shall remove all of its property from the
Leased Premises within thirty (30) days after the notice of termination is given, provided Tenant is not in
default at the time.
19. I andinrd's Insurance. Landlord shall maintain during the Term such commercial public
liability insurance for the Common Areas as Landlord deems appropriate, and shall also maintain during the
Term primary, non-contributory insurance on the Building against fire, and extended coverage or "all-risk"
insurance, in an amount equal to the full insurable replacement value of the Building (excluding costs of
excavation, foundations and footings, and such risks required to be covered by Tenant's insurance), or such
other amount necessary to prevent Landlord from being a co-insured (collectively, the "Insurance"). Tenant
shall pay as Additional Rent in equal monthly installments, in advance, without prior demand or offset of any
kind, its prorata share of the cost of the Insurance. Tenant's prorata share of the Insurance is stated in
Section 1, subsection (1), of this lease. Tenant's prorata portion of the Insurance may be reviewed, adjusted
and billed in the same manner as set forth in Section 5, subsection (c) above.
20. Tenant's Insurance,
(a) Tenant shall, at all times during the Term and at its own cost and expense, carry: (i)
commercial general liability insurance on the Leased Premises (including Common Areas adjoining the
Leased Premises) with limits of not less than $1,000,000.00 for injury or death to one person, $2,000,600.00
for injury or death to more than one person, and $500,000.00 for property damage; (ii) "all-risk" casualty
insurance, written at replacement cost value and with replacement cost endorsement, covering all Tenant's
personal property in the Leased Premises (including, without limitation, inventory, trade fixtures, floor
coverings, furniture, and other property removable by Tenant under the provisions of this. Lease) and all
Leasehold improvements installed in the Leased Premises by or on behalf of Tenant; (iii) plate glass
insurance; and (iv) if and to the extent required by Law, workmen's compensation or similar insurance.
(b) All such insurance policies shall name Landlord as a named insured and shall be written by
companies acceptable to Landlord and in form acceptable to Landlord. Each such policy shall also contain a
provision prohibiting cancellation without thirty (30) days' prior written notice to Landlord or its designee
Certificates of such insurance policies shall be delivered to Landlord promptly after the issuance of the
the Leased Premises, including vestibules, entryways, and walkways adjoining the Leased Premises, and the
loading platform area, if any, allocated to the use of Tenant. Tenant shall also indemnify and hold Landlord
harmless from such liability for damage in other parts of the Building if caused by Tenant's negligence,
affirmative act, or breach of its obligations under this Lease. All property kept, stored, or maintained in the
Premises shall be kept, stored, or maintained at Tenant's sole risk. Tenant waives all claims against and
releases Landlord, and Landlord's employees and agents, from liability for damages or injury suffered by
Tenant or any person claiming through Tenant as a result of any accident or other occurrence in or upon the
Leased Premises or any other part of the Building, unless the damage or injury was caused by Landlord's
gross negligence or willful misconduct.
22. 1NaivPr ^f Subm9afinn, Tenant waives all claims against Landlord for any damage or loss
Tenant may suffer which is covered by an insurance policy carried by Tenant (or which Tenant is required to
carry under this Lease); and any insurance policy carried by Tenant covering the Leased Premises, its
contents, or any part thereof, shall contain an express waiver of any right of subrogation against Landlord by
the issuer of the policy. Landlord waives all claims against Tenant for any damage or loss Tenant may suffer
which is covered by an insurance policy carried by Landlord (or which Tenant is required to carry under this
Lease); and any insurance policy carried by Landlord covering the Leased Premises, its contents, or any part
thereof, shall contain an express waiver of any right of subrogation against Tenant by the issuer of the policy.
23. Default.
23.1 „Fventof nefardt" nefineri.
Any one or more of the following events shall constitute an "Event of Default":
(a) The sale of Tenant's interest in the Premises under attachment, execution or similar
legal process, or if Tenant is adjudicated as bankrupt or insolvent under any state bankruptcy or insolvency
law or an order for relief is entered against Tenant under the Federal Bankruptcy Code and such adjudication
or order is not vacated within ten (10) days.
(b) The commencement of a case under any chapter of the Federal Bankruptcy Code
by or against Tenant or any guarantor of Tenant's obligations hereunder, or the filing of a voluntary or
involuntary petition proposing the adjudication of Tenant or any such guarantor as bankrupt or insolvent, or
the reorganization of Tenant or any such guarantor, or an arrangement by Tenant or any such guarantor with
its creditors, unless the petition is filed or case commenced by a party other than Tenant or any such
guarantor and is withdrawn or dismissed within thirty (30) days after the date of its filing,
(c) The admission in writing by Tenant or any such guarantor of its inability to pay its
debts when due;
(d) The appointment of a receiver or trustee for the business or property of Tenant or
any such guarantor, unless such appointment shall be vacated within ten (10) days of its entry.
(e) The making by Tenant or any such guarantor of an assignment for the benefit of its
creditors, or if in any other manner Tenant's interest in this Lease shall pass to another by operation of law.
(f) The failure of Tenant to pay any Minimum Rent, Additional Rent, Percentage Rent
("Rental") or other sum of money when due.
(g) Default by Tenant in the performance or observance of any covenant or agreement
of this Lease (other than a default involving the payment of money), which default is not cured within ten (10)
days after the giving of notice thereof by Landlord, unless such default is of such natUre that it cannot be
cured within such ten (10) day period, in which case no Event of Default shall occur so long as Tenant shall
commence the curing of the default within such ten (10) days period and shall thereafter diligently prosecute
the curing of same; provided, however, if Tenant shall default in the performance of any such covenant or
agreement of this Lease two (2) or more times in any twelve (12) month period, then notwithstanding that
each of such defaults shall have been cured by Tenant, any further similar default shall be deemed an Event
of Default without the ability for cure.
(h) The vacation or abandonment of the Premises by Tenant at any time following
delivery of possession of the Premises to Tenant.
M Tk. ......, ,...........,s ...... ..•k- ........ .I.._,..:1. _.a -- ,..___a.a..a._.. __ • s t iu.
Upon the occurrence of an Event of Default, Landlord, without notice to Tenant in any instance (except where
expressly provided for below or by applicable law) may do any one or more of the following:
(a) With or without judicial process, enter the Premises and take possession of any and
all goods, inventory, equipment, fixtures and all other personal property of Tenant, which is or may be put into
the premises during the Term, whether exempt or not from sale under execution or attachment (it being
agreed that said property shall at all times be bound with a lien in favor of Landlord, provided however that
any such lien shall be subordinate to any and all secured creditors of Tenant, and shall be chargeable for all
Rental and for the fulfillment of the other covenants and agreements herein contained), and Landlord may
sell all or any part thereof at public or private sale, subject to the interests of any secured creditor of Tenant.
Tenant agrees that ten (10) days prior written notice of any public or private sale shall constitute reasonable
notice. The proceeds of any such sale shall be applied, first, to the payment of all costs and expenses of
conducting the sale or caring for or storing said property (including reasonable attorneys' fees); second,
toward the payment of any indebtedness, including (without limitation) indebtedness for Rental, which may be
or may become due from Tenant to Landlord; and third, to pay Tenant, on demand, any surplus remaining
after all indebtedness of Tenant to Landlord has been fully paid;
(b) Perform, on behalf and at the expense of Tenant, any obligation of Tenant under
this Lease which Tenant has failed to perform and of which Landlord shall have given Tenant notice, the cost
of which performance by Landlord, together with interest thereon at the Default Rate from the date of such
expenditure, shall be deemed Additional Rental and shall be payable by Tenant to Landlord upon demand.
Notwithstanding the provisions of this clause (b) and regardless of whether an Event of Default shall have
occurred, Landlord may exercise the remedy described in this clause (b) without any notice to Tenant if
Landlord, in its good faith judgment, believes it would be materially injured by failure to take rapid action or if
the unperformed obligation of Tenant constitutes an emergency;
(c) Elect to terminate this Lease and the tenancy created hereby by giving ten (10)
days prior written notice of such election to Tenant, and reenter the Premises, without the necessity of legal
proceedings, and remove Tenant and all other persons and property from the Premises, and may store such
property in a public warehouse or elsewhere at the cost of and for the account of Tenant without resort to
legal process and without Landlord being deemed guilty of trespass or becoming liable for any loss or
damage occasioned thereby; or
(d) Exercise any other legal or equitable right or remedy which it may have.
Any costs and expenses incurred by Landlord (including, without limitation, reasonable attorneys' fees) in
enforcing any of its rights or remedies under this Lease shall be deemed to be Additional Rental and shall be
repaid to Landlord by Tenant upon demand.
23.3 Damages.
If this Lease is terminated by Landlord pursuant to Section 23.2, Tenant nevertheless shall remain liable for
(a) any Rental and damages which may be due or sustained prior to such termination, all reasonable costs,
fees and expenses including, but not limited to, reasonable attorneys' fees, costs and expenses incurred by
Landlord in pursuit of its remedies hereunder, or in renting the Premises to others from time to time (all such
Rental, damages, costs, fees and expenses being referred to herein as "Termination Damages"), and (b)
additional damages (the "Liquidated Damages"), which, at the election of Landlord, shall be either:
(i) an amount equal to the Rental which, but for termination of this Lease, would have
become due during the remainder of the Term, less the amount of Rental, if any, which Landlord shall receive
during such period from others to whom the Premises may be rented (other than any Additional Rental
received by Landlord as a result of any failure of such other person to perform any of its obligations to
Landlord), in which case such Liquidated Damages shall be computed and payable in monthly installments,
in advance, on the first day of each calendar month following termination of the Lease and continuing until the
date on which the Term would have expired but for such termination, and any suit or action brought to collect
any such Liquidated Damages for any month shall not in any manner prejudice the right of Landlord to collect
any Liquidated Damages for any subsequent month by a similar proceeding; or
(ii) an amount equal to the present worth (as of the date of such termination) of Rental
which, but for termination of this Lease, would have become due during the remainder of the Term, less the
fair rental value of the Premises, as determined by an independent real estate appraiser named by Landlord,
in which case such Liquidated Damages shall be payable to Landlord in one lump sum on demand and shall
bear interest at the Default Rate until paid. For purposes of this clause (ii), "present worth" shall be computed
by dicf`nnnlinn mirh omn, m} }n --# .... .k n4 .. A:.. ? . . . . . I .,, _-_ __,_-_.___ __,_. - .,..
which otherwise would have constituted the balance of the Term) and on such terms and conditions (which
may include concessions or free rent and alterations of the Premises) as Landlord, in its sole discretion, may
determine, but Landlord shall not be liable for, nor shall Tenant's obligations hereunder be diminished by
reason of, any failure by Landlord to relet the Premises or any failure by Landlord to collect any rent due upon
such reletting.
Nothing contained in this Lease shall limit or prejudice the right of Landlord to prove and obtain, in
proceedings for the termination of this Lease by reason of bankruptcy or insolvency, an amount equal to the
maximum allowed by any statute or rule of law in effect at the time when, and governing the proceedings in
which, the damages are to be proved, whether or not the amount be greater, equal to., or less than the
amount of the loss or damages referred to above. The failure or refusal of Landlord to relet the Premises or
any part or parts thereof shalt not release or affect Tenant's liability for damages.
23.4 RPrnedia,S in Fyp„nt of gankruptry or Othar Pi-reeding. eding.
(a) Anything contained herein to the contrary notwithstanding, if termination of this
Lease shall be stayed by order of any court having jurisdiction over any proceeding described in paragraph
(b) of Section 23.1, or by federal or state statute, then, following the expiration of any such stay, or if Tenant
or Tenant as debtor-in-possession or the trustee appointed in any such proceeding (being collectively
referred to as "Tenant" only for the purposes of this Section 23.4) shall fail to assume Tenant's obligations
under this Lease within the period prescribed therefor by law or within fifteen (15) days after entry of the order
for relief or as may be allowed by the court, or if Tenant shall fail to provide adequate protection of Landlord's
right, title and interest in and to the Premises or adequate assurance of the complete and continuous future
performance of Tenant's obligations under this Lease, Landlord, to the extent permitted by law or by leave of
the court having jurisdiction over such proceeding, shall have the right, at its election, to terminate this Lease
on fifteen (15) days' notice to Tenant and upon the expiration of said fifteen (15) day period this Lease shall
cease and expire as aforesaid and Tenant shall immediately quit and surrender the Premises as aforesaid.
Upon the termination of this Lease as provided above, Landlord, without notice, may re-enter and repossess
the Premises using such force for that purpose as may be necessary without being liable to indictment,
prosecution or damages therefor and may dispossess Tenant by summary proceedings or otherwise.
(b) For the purposes of the preceding paragraph (a), adequate protection of Landlord's
right, title and interest in and to the Premises, and adequate assurance of the complete and continuous future
performance of Tenant's obligations under this Lease, shall include, without limitation, the following
requirements:
(i) that Tenant comply with all of its obligations under this Lease;
(ii) that Tenant pay to Landlord, on the first day of each month occurring
subsequent to the entry of such order, or the effective date of such stay, a sum equal to the amount by which
the Premises diminished in value during the immediately preceding monthly period, but, in no event, an
amount which is less than the aggregate Rental payable for such monthly period;
(iii) that Tenant continue to use the Premises in the manner originally required
by this Lease;
(iv) that Landlord be permitted to supervise the performance of Tenant's
obligations under this Lease;
(v) that Tenant pay to Landlord within fifteen (15) days after entry of such order
or the effective date of such stay, as partial adequate protection against future diminution in value of the
Premises and adequate assurance of the complete and continuous future performance of Tenant's
obligations under this Lease, an additional security deposit in an amount acceptable to Landlord;
(vi) that Tenant has and will continue to have unencumbered assets after the
payment of all secured obligations and administrative expenses to assure Landlord that sufficient funds will
be available to fulfill the obligations of Tenant under this Lease;
(vii) that if Tenant assumes this Lease and proposes to assign the same
(pursuant to Title 11 U.S.G. § 365, or as the same may be amended) to any person who shall have made a
bona fide offer to accept an assignment of this Lease on terms acceptable to such court having competent
jurisdiction over Tenant's estate, then notice of such proposed assignment, setting forth (x) the name and
address of such person, (y) all of the terms and conditions of such offer, and (z) the adequate assurance to
hA nmvidpri I Anrflnrrl fn -ceuro enrV norcnn`c fi du re nnrrnr , . -r..- 'k;,. I ..--- ;--, d
and option, to be exercised by notice to Tenant given at any time prior to the effective date of such proposed
assignment, to accept, or to cause Landlord's designee to accept, an assignment of this Lease upon the
same terms and conditions and for the same consideration, if any, as the bona fide offer made by such
person less any brokerage commissions which may be payable out of the consideration to be paid by such
person for the assignment of this Lease; and
(viii) that if Tenant assumes this Lease and proposes to assign the same, and
Landlord does not exercise its option pursuant to paragraph (vii) of this Section 23.4, Tenant hereby agrees
that:
(A) such assignee shall have a net worth not less than the net worth of
Tenant as of the Commencement Date, or such Tenant's obligations under this Lease shall be
unconditionally guaranteed by a person having a net worth equal to Tenant's net worth as of the
Commencement Date;
(B) such assignee shad not use the Premises except subject to all the
restrictions contained in this Lease;
(C) such assignee shall assume in writing all of the terms, covenants
and conditions of this Lease including, without limitation, all of such terms, covenants and conditions
respecting the Permitted Use and payment of Rental, and such assignee shall provide Landlord with
assurances satisfactory to Landlord that it has the experience in operating stores having the same or
substantially similar uses as the Permitted Use, in first-class shopping centers, sufficient to enable it so to
comply with the terms, covenants and conditions of this Lease and successfully operate the Premises for the
Permitted Use;
(D) such assignee shall indemnify Landlord against, and pay to
Landlord the amount of, any payments which Landlord may be obligated to make to any Mortgagee by virtue
of such assignment;
(E) such assignee shall pay to Landlord an amount equal to the
unamortized portion of any construction allowance made to Tenant; and
(F) if such assignee makes any payment to Tenant, or for Tenant's
account, for the right to assume this Lease (including, without limitation, any lump sum payment, installment
payment or payment in the nature of rent over and above the Rental payable under this Lease), Tenant shall
pay over to Landlord one-half of any such payment, less any amount paid to Landlord pursuant to clause (E)
above on account of any construction allowance.
24. waWed hTLanffinrci Landlord's failure to insist upon strict performance by Tenant of any
obligation under this Lease, irrespective of the length of time for which such failure continues, shall not be
construed as a waiver or relinquishment of Landlord's right to demand strict compliance in the future. The
receipt and acceptance by Landlord of rent with knowledge of the breach of any obligation hereof shall not be
deemed a waiver of such breach, and no waiver by Landlord of any provision of this Lease shall be deemed
to have been agreed upon unless expressed in a writing signed by the parties.
25. Liens Tenant shall pay all sums of money due for labor, services, materials, supplies and
equipment furnished at Tenant's request with respect to the Leased Premises or any other part of the
Building. If a mechanic's, materialman's, or other lien (or notice of intent to file such a lien) is filed or recorded
against the Leased Premises, the Building, or Landlord's interest in either, based upon labor, services,
materials, supplies, equipment, or the like ordered, or alleged to have been ordered by Tenant, Tenant shall
cause such lien to be discharged of record within ten (10) days after Tenant first has knowledge of such lien.
If such lien is not discharged within the ten (10) day period, Landlord may (but shall not be obligated to)
cause such discharge by (i) payment to the lienor, (ii) deposit of substitute security with a court having
jurisdiction, (iii) bonding, or (iv) such other means chosen by Landlord; and the entire cost of the discharge
shall be paid to Landlord by Tenant upon demand. Tenant shall, upon request, furnish Landlord with
contractors' affidavits, full and final waivers of right to lien, and receipted bills covering all labor and materials
expended and used in or about the Leased Premises by or at the request of Tenant.
26. Signs wningc and Canopies. Tenant shall not place or display (or cause to be placed or
displayed) on any exterior door, wall, or window of the Leased Premises any sign, awning, canopy,
advertising matter, or other thing of any kind, and shall not place or display any decoration, lettering, or
advertising matter on the glass of any window or door of the Leased Premises, without Landlord's prior
written aoorovai. Tenant shall maintain such Ginn awninn rannnv riennrafinn laffarinn nrfVarrisinn mnHar
27. Exhih> its Addpnria Rules and Regulations. All Exhibits, Addenda and Rules and
Regulations appended to this Lease are hereby incorporated into this Lease, and Tenant shall comply with
and observe the same. Tenant's failure to comply with and observe the same shall constitute a breach of this
Lease. Landlord reserves the right to amend, supplement, or add to such Rules and Regulations from time
to time.
28, swrPnrier of Prenises. On expiration or sooner termination of the Term, Tenant shall
surrender to Landlord the Leased Premises and all Tenant's improvements and alterations, broom clean, in
good order, condition, and repair, except for ordinary wear and tear or condemnation or destruction of the
Leased Premises, and except for trade fixtures that Tenant has removed. Tenant shall also deliver to
Landlord all keys to the Leased Premises and the combination to any safe, remove all its personal property,
and make all repairs and reimbursements required pursuant to this Lease; provided, however, Tenant may
not remove its personal property from the Leased Premises without Landlord's prior written consent, if Tenant
is in breach or default hereunder.
Landlord may elect to retain or dispose of in any manner any alterations or Tenant's personal
property that Tenant does not remove from the premises on expiration or termination of the Term. Title to
any such alterations or Tenant's personal property that Landlord elects to retain or dispose of after expiration
of the Term shall vest in Landlord. Tenant waives all claims against Landlord for any damage to Tenant
resulting from Landlord's retention or disposition of any such alterations or personal property. Tenant shall
be liable to Landlord for Landlord's costs of storing, removing, and disposing of any alterations or Tenant's
personal property which Landlord does not elect to acquire.
29. Hnldnver. Tenant shall indemnify and hold Landlord harmless from and against all costs,
claims, loss, or liability resulting from delay by Tenant in surrendering the Leased Premises, including,
without limitation, any claims made by any succeeding tenant founded on such delay. The parties recognize
and agree that the damage to Landlord resulting from any failure by Tenant to timely surrender possession of
the Leased Premises will be extremely substantial, will exceed the amount of the Minimum Rent payable
under this Lease, and will be impossible to measure accurately. Tenant therefore agrees that if possession
of the Leased Premises is not surrendered to Landlord within twenty-four (24) hours after the date of the
expiration or termination of the term, then Tenant shall pay, for each month and for each portion of any
month during which Tenant holds over in the Leased Premises after the expiration or termination of the Term,
two times the aggregate of that portion of the Minimum Rent which was payable under this Lease during the
last month of the Term. Nothing contained in this Lease shall be deemed to permit Tenant to retain
possession of the Leased Premises after the expiration of the Term. The provisions of this Section shall
survive the expiration or termination of the Term.
30. ` iffiordinarion nnri AttnrnmPnt. This Lease is and shall be subject and subordinate to any
mortgage, deed of trust, underlying leasehold estate, or other arrangement or right to possession that may
now or hereafter be placed upon or affect the Leased Premises or the land of which the Leased Premises is
a part, or against any building hereafter placed upon the land of which the Leased Premises is a part, to all
advances to be made thereunder, to the interest and principal payable thereon, and to all renewals,
replacements, modifications, consolidations, and extensions thereof. Upon Landlord's request Tenant shall
execute and deliver such documents, in such terms as Landlord reasonably requests, to evidence the same.
Upon request of any such mortgagee, Tenant shall attorn to and acknowledge the foreclosure purchaser or
purchasers as Landlord hereunder.
3L Estoppel Certificates. Upon Landlord's request, Tenant shall execute, acknowledge, and
deliver to Landlord a written statement, addressed to such person as Landlord may request, (a) certifying that
this Lease is in full force and effect and unmodified (or if modified, specifying the modifications), and that
Landlord is not in default under this Lease (or if a default is alleged, specifying the default), (b) stating the
date to which rent and any other charges have been paid by Tenant and the address to which notices to
Tenant should be sent, and (c) certifying or stating such other matters as may be required by Landlord. If
Landlord has not received a response within ten (10) days of any such request, such certificate shall be
deemed acceptable to Tenant, whereupon Landlord shall be appointed as Tenant's attorney-in-fact to
execute and deliver such certificate.
32, Ei,hrra Rp nninn If all or part of the Building can be refinanced or further financed only
upon the basis of modifications of this Lease, Tenant shall enter into a written agreement with Landlord
making such Lease modifications as may be required; provided, however, Tenant shall not be required to
make any such modifications relating to the amount of Rent, the use of the Leased Premises, the duration of
the Term, or the improvements, if any, to be made by Landlord to the Leased Premises.
34. FnrrP 'Pero. Whenever Tenant or Landlord is required by the terms of this Lease or by
law to perform any contract, act, work, labor or services, or to discharge any lien against the Leased
Premises, or to perform and comply with any laws, rules, orders, ordinances, or regulations, but is unable to
perform such act(s), then Tenant or Landlord, as appropriate, shall not be deemed to be in default and the
other party shall not enforce or exercise any of its rights under this Lease, if and so long as nonperformance
or default is directly caused by strikes, non-availability of materials, war or national defense preemptions,
governmental restrictions, acts of God, acts of the other party, or other similar causes beyond the reasonable
control of the non-performing party. Tenant and Landlord shall in any event pay any sum of money required
to discharge any lien incurred by them if at any time the Leased Premises, or any part thereof, is in danger of
being foreclosed, forfeited, or lost by reason of such lien.
35. 1 irnitatinn of I andlnrl's I i- ahilrty. Except to the extent insurance proceeds are actually
received by Landlord, Landlord shall not be responsible or liable for latent defects, deterioration, or change in
the condition of the Building, the. Common Areas, or the Leased Premises, or for any damage resulting
therefrom, whether to person or property, or for loss to any property of Tenant as a result of theft or
misplacement, or for inconvenience, business interruption, or loss of business of Tenant for any reason. To
the extent covered by Tenant's insurance, Tenant shall indemnify and hold Landlord harmless from and
against any and all claims arising out of Tenant's use or occupancy of, or from any other activity permitted or
suffered by Tenant in or about, the Leased Premises, the Building, or shall be fully liable for, and shall
indemnify Landlord against, all such claims. Regardless of any other provision of this Lease, if Landlord, or
its employees, officers, or partners are ordered to pay Tenant a money judgment because of Landlord's
default, then Tenant's sole remedy to satisfy the judgment shall be Landlord's interest in the Building,
including the rental income and proceeds from sale and any insurance proceeds received because of
damage to the Building that are available for use by Landlord. The foregoing shall not be deemed to limit
Tenant's right, if any, to obtain injunctive relief or specific performance.
36. Notices. Any notice, demand, consent, request, or other communication required or
permitted under this Lease shall be in writing and shall be given by hand delivery or sent by the United States
Mail by certified mail, return receipt requested, postage prepaid, and addressed as indicated in Section 1,
subsection (m), Notice shall be deemed given when hand delivered or two (2) days after deposit with the
United States Postal Service. The parties may change their respective addresses by written notice to all
other parties.
37, t7Li F 'gym . Landlord covenants that Tenant, on paying all rents and performing all the
obligations set forth in this Lease, shall have and enjoy quiet and peaceable possession of the Leased
Premises during the Term.
38. Fntim Agreement. This Lease contains the entire agreement between the parties with
respect to the leasing of the Leased Premises and supersedes, merges and replaces all prior written or oral
agreements, negotiations, offers, representations, and warranties with respect to the leasing of the Leased
Premises. This agreement cannot be altered, waived, or modified in any way, including the provisions of this
Section, except in a writing signed by the parties. No course of dealing between the parties, no usage of
trade, and no parol or outside evidence of any nature shall be used to modify, interpret, or supplement any
provision of this Lease.
39. SundyaL The representations, warranties, and agreements of the parties contained in this
Lease and in all other documents delivered in connection with this Lease shall survive the expiration or
sooner termination of this Lease.
40 Se Pmbffi , If any provision of this Lease is unenforceable, the remainder of this Lease
shall continue in effect and be construed as if the unenforceable provision had not been contained in this
Lease. Each provision of this Lease shall be valid and enforceable to the fullest extent permitted by law.
41. Sucressore and Assigns. This Lease shall be binding upon and inure to the benefit of the
parties and their respective heirs, personal representatives, successors, and assigns; provided, however,
that this Section shall not be construed to permit the assignment of this Lease except as expressly provided.
42. Third Party Beneficiaries. The provisions of this Lease are intended to benefit only the
parties to this Lease. No person not a party to this Lease shall be deemed a third party beneficiary of this
Lease nor shall any such person be authorized or empowered to enforce the provisions of this Lease, except
to the extent such a person becomes a permitted assignee of one of the parties.
43. Venue Regardless of what venue would otherwise be permissive or required, the parties
stipulate that all actions arisino under or affectino this I PasP than he hrminht in the r.niirf of nnmmnn oi-
44. C:nncprf to luricriirtinn and P rP f rP
jurisdiction of the state courts of the Commonwealth of Pennsylvania hand for the ju sdiction of the United
States District Court for the Middle District of Pennsylvania, for the purpose of any suit, action, or other
proceeding arising under or affecting this Lease.
45. nalls In computing the number of days for purposes of this Lease, all days shall
be counted, including weekends and holidays; provided, however, that if the last day for taking any action
under this Lease shall fall on a Saturday, Sunday or banking holiday, the time for taking such action shall be
extended to the next regular business day.
46. NLmbeLand C PnriPr When used in this Lease, the singular includes the plural, the plural
includes the singular, and the use of any gender includes any other gender, as circumstances may require.
The term "person" includes both natural persons and entities.
47. Headings. The headings contained in this Lease are for the convenience of the parties only
and are not a part of the substantive agreement of the parties nor shall they affect the meaning or
interpretation of any provision of this Lease in any way.
48. CAwnterparts. This Lease may be executed in multiple counterparts. When at least one (1)
copy of this Lease has been executed by each party to this Lease, this Lease shall be in full force and effect,
and all of such counterparts shall be read together as a single agreement.
49. Recording Upon request of either Tenant or Landlord, the parties shall execute a short form
of this Lease in a written document witnessed and acknowledged in form capable of being recorded in the
public records, which short form Lease shall be recorded at the sole cost and expense of the party requesting
the same in the Office of the Recorder of Deeds in and for Cumberland County, Pennsylvania, wherein the
Leased Premises are located.
50. Reimburcampnt for Credit Report Tenant shall reimburse Landlord upon Landlord's request
for reasonable amounts Landlord has paid to obtain credit reports on Tenant and all Guarantors of Tenant's
obligations under this Leases.
51. Idal by Wry Landlord and Tenant each waives any right to trial by jury of any issue(s) in a
summary proceeding or any other suit, action, proceeding or counterclaim at any time brought or instituted by
or against the other with respect to or involving the Leased Premises or any matter arising under or
connected with this Lease and the relationship of Landlord and Tenant created by this Lease.
IN WITNESS WHEREOF each corporate party hereto has caused this Lease to be executed in its name and
behalf by its duly authorized officer or agent; each individual party hereto has hereunto set his hand, and
each partnership party hereto has caused this Lease to be executed in its name and behalf by the required
number of its General Partners.
Landlord: /
Title: /?EHt(cr.,/ 7_ %,.
Date: _.,,D. w lb?"
Tenant: Z or / Z-:
By:
Title:_ /7NK, t?
r,.e,-
Date:_ z-/i,
COMMONWEALTH OF PENNSYLVANIA
COUNTY OFC4M GF-QJAV t7, to-wit:
T e foregoing in trument was acknowledged b fore me this ?? _-d3y F
in 12 qf?0 e ? n,o ti k 200 6, by
1
Notary Public
My Commission Expires: -L?-Q
orial Senl
ody, Nolary Public
Mro, Cumbedand County
ires Expires Mar. 11, 2008
The following provisions establish the criteria and requirements for Tenant's signage in, upon and
around the Leased Premises and the Building. Included herein are the specifications for design, location,
construction and installation of all Tenant signage and the procedure for effecting same. Notwithstanding
anything contained herein or elsewhere in the Lease, Tenant shall not construct or erect any signage in the
Leased Premises or the Building without the prior written approval of the Landlord, which approval may be
withheld, delayed or denied in Landlord's sole and absolute discretion. Furthermore, notwithstanding
anything in this Exhibit B or the Lease to the contrary, Landlord reserves the right to modify, supplement or
eliminate all or any portion of the provisions of this Exhibit B from time to time during the term without notice
to Tenant, and any revisions to this Exhibit B shall be applicable to any pending or subsequent request by
Tenant for any signage.
Tenant shall be responsible, at Tenant's sole cost and expense, for the design, construction and
installation of any signage approved by Landlord (in its sole discretion.)
2. ?FSIGN rRITFRIA-
a) Tenant shall submit design to Landlord for approval,
a) Composition and Materials - All such figures shall have closed backs and shall be leak
resistant.
b) Electrical - No flashers, moving signs, panels or other elements will be permitted. Design,
fabrication and installation of all electrical work shall be in strict adherence to all applicable governmental
laws, codes or ordinances.
C) Structural Location and Attachment - All sign structures or elements shall consist of rigid
metal framework with stable interiors to which anchoring bolts, brackets, sleeves or other approved methods
of attachment can be fastened. Structural design, fabrication and installation shall be adequate to withstand
wind and other natural stresses and be sufficient to support the weight of the elements so attached. The sign
and its elements shall have concentric horizontal alignment with Tenant's demised storefront and concentric
vertical alignment with the sign band as specified by Landlord. All letters, numbers, logos, emblems or other
elements shall be individually attached to the building by means of concealed fasteners accomplished so as
to minimize damage to the building and allow for ease of removal; it being understood and agreed that
Tenant shall be responsible for the repair of any damage resulting from the improper installation or removal of
its signage. No raceways shall be permitted. No part of the signage or fasteners shall have corrosive or
stainable materials.
a) Design and Submission - Tenant shall submit two (2) copies of its proposed sign drawings
and specifications to Landlord, and the required number of copies to the governmental authorities having
jurisdiction for approval, if necessary, prior to fabrication and installation. Tenant or its sign contractors shall
secure and pay for all necessary permits and authorizations required by public authorities for the installation
and operation of any Tenant signage. Such drawings and specifications shall clearly indicate all dimensions
and materials to be used including size, copy and color of all letters, numbers, logos and emblems in full
detail. At least one (1) copy of said drawings shall be rendered in colors as close to those proposed to be
used and shall be submitted to Landlord. Landlord thereafter shall respond with any changes required and
Landlord's determination in all signage matters shall be deemed to be conclusive and binding. Any delays or
denials of signage approval shall in no way affect Tenant's obligations under the Lease or any other provision
dealing with Tenant's construction, occupancy or use of the Leased Premises.
b) Contractors - The sign(s) fumished by Tenant shall be fabricated and installed by a licensed
contractor(s) in accordance with the criteria and requirements contained herein and in strict compliance with
all applicable codes, laws, ordinances and/or regulations of any governmental authorities having jurisdiction
thereof. For the purposes of the Lease, signage fabrication and installation shall be deemed an item of
a) Miscellaneous Sign(s) - Tenant shall not affix any signs, advertising placards, names,
insignias, trademarks or other descriptive material(s) (i) upon the glass panes, mullions, supports or doors of
Tenant's demised storefront, (ii) within twelve (12") inches of any show window or front door, or (iii) upon the
exterior walls of the Leased Premises, without the prior written approval of Landlord, which approval may be
withheld, delayed or denied in Landlord's sole discretion. Notwithstanding anything to the contrary in the
Lease, under no circumstances shall any sign be affixed to the roof of the Leased Premises or the Building.
(a) ORSTRIICTION OE PASSACFWAYC The sidewalks, passages, courts, corridors, and
other public parts of the Building shall not be obstructed or encumbered by Tenant or used by Tenant for any
purpose other than ingress and egress.
(b) ININDOV Windows in the Leased Premises shall not be covered or obstructed by
Tenant. No bottles, parcels, or other articles shall be placed on the window sills, in the halls, or in any other
part of the Building. No articles shall be thrown out of the doors or windows of the Leased Premises.
(c) PROJECTIONS FROM 131 111 DING No awnings, air conditioning units, or other fixtures
shall be attached to the outside walls or the window sills of the Building by Tenant or otherwise affixed by it so
as to project from the Building, without the prior written consent of Landlord.
(d) SIGNS No sign or lettering shall be affixed by Tenant to any part of the outside of the
Building, or any part of the inside of the Leased Premises so as to be clearly visible from the outside of the
Building, without prior written consent of Landlord.
(e) FLOOR COVERING -(OMITTED)
(0 INTERFERENCE WIH DMI'PANTS CIF RI III DING' Tenant shall not ke, or permit to be
made, any unseemly or disturbing noises and shall not interfere with other tenants or those having business
with them. Tenant will keep all mechanical apparatus in the Leased Premises free of vibration and noise
which may be transmitted beyond the limits of the Leased Premises.
(g) I nr:K4 KFYS No additional locks or bolts of any kind shall be placed on any of the doors
or windows by Tenant. Tenant shall, on the termination of Tenant's tenancy, deliver to Landlord all keys to
any space within the Building, either furnished to or otherwise procured by Tenant, and in the event of the
loss of any keys furnished, Tenant shall pay Landlord the cost thereof. Tenant, before closing and leaving
the Leased Premises, shall ensure that all its windows are closed and its entrance doors locked.
(h) CONTRAC TORS Landlord shall not be responsible to Tenant for any loss of property from
the Leased Premises however occurring, or for any damage done to the effects of Tenant by janitors or any
of Tenant's employees, or by any other person or any other cause.
W PHnHIH H FI) nN I FASFD PROS Tenant shall not, without the prior written approval
of Landlord, (i) conduct, or permit any other person to conduct, any auction upon the Leased Premises, (ii)
permit the Leased Premises to be used for gambling or any other illegal activity, (iii) make any unusual noises
in the Building, (iv) permit to be played any musical instrument on the Leased Premises, (v) permit to be
played any radio, television, recorded or wired music in such a loud manner as to disturb or annoy other
tenants, or (vi) permit any unusual odors to be produced upon the Leased Premises. Canvassing, soliciting
and peddling in the Building are prohibited, and Tenant shall cooperate to prevent the same. No bicycles,
vehicles or animals of any kind shall be brought into or kept in or about the Leased Premises or the Building,
except that vehicles may be parked in the parking spaces provided in the Common Areas and in accordance
with such other rules with respect to vehicles and parking as may be established from time to time by
Landlord.
(!) pi ItMRINr; -El FCTRIC ANn TFI FPHr1NF &nRK plumbing facilities shall not be used
for any purpose other than those for which they were constructed; and no sweepings, rubbish, ashes,
newspaper or other substances of any kind shall be thrown into them. Waste and excessive or unusual
usage of electricity or water is prohibited. When electric wiring of any kind is introduced, it must be
connected as directed by Landlord, and no stringing or cutting of wires will be allowed, except by prior written
consent of Landlord, and shall be done by contractors approved by Landlord.
(k) SAFES AND OTHER HFASN FOIJ12MFNT Landlord reserves the right to prescribe the
weight and position of all safes and other heavy equipment so as to distribute properly the weight thereof and
to prevent any unsafe condition from arising.
(1) NOTICE OF ACCIDENTS Tenant shall give Landlord prompt written notice of any accident
or damage occurring on or to the Leased Premises or the Common Areas adjacent to the Leased Premises.
EXHIBIT D
WORKAGREEMENT
THIS AGREEMENT made as of the day of
, ("Landlord") and_
2005, between
("Tenant"). The parties hereby acknowledge that they have heretofore entered, or are contemporaneously
herewith entering, a certain Lease agreement dated , 2005 (the "Lease") for
premises (the "Leased Premises") known as located in the property known as
(the "Property").
1. Tha Work Under the Lease, Tenant has agreed to accept the Leased Premises "as is",
without any obligations for the performance of improvements or other work by Landlord, and Tenant desires
to perform certain improvements thereto (the "Work"). Such Work shall be in accordance with the provisions
of this Work Agreement, and to the extent not expressly inconsistent herewith, in accordance with the
provisions of the Lease. Performance of the Work shall not serve to abate or extend the time for the
commencement of Rent under the Lease, except to the extent Landlord delays approvals beyond the times
permitted below.
2. Cost of the Wnrk Except as provided hereinafter, Tenant shall pay all costs (the "Costs of
the Work") associated with the Work whatsoever, including without limitation, all permits, inspection fees, fees
of space planners, architects, engineers, and contractors, utility connections, the cost of all labor and
materials, bonds, insurance, and any structural or mechanical work, all HVAC equipment or sprinkler heads,
or modifications to any building mechanical, electrical, plumbing or other systems and equipment or
relocation of any existing sprinkler heads, either within or outside the Leased Premises required as a result of
the layout, design or construction of the Work.
Of the Costs of the Work, Landlord shall reimburse Tenant the amount of $ (the
"Improvement Allowance"). The Improvement Allowance shall be funded by Landlord within thirty (30) days
after the Work has been completed in accordance with the "Space Plan" and "Working Drawings" approved
by Landlord in writing in accordance with the provisions hereof, and Tenant has submitted all invoices, lien
waivers, affidavits of payment, and such other evidence as Landlord may reasonably require that the cost of
the Work has been paid for and that no mechanic's, materialmen's, or other such liens have been or may be
filed against the Property or the Leased Premises arising out of the design or performance of the Work. In
the alternative, at Landlord's sole option, Landlord may elect to fund the Improvement Allowance in
installments, not more frequently than monthly, based on applications for payment and releases of lien rights,
submitted by Tenant on Landlord's standard form for use by contractors requesting progress payments,
together with such lien releases and affidavits of payments by Tenant's general contractor and
subcontractors contemplated therein, and such other documentation as Landlord may reasonably require.
Landlord may issue checks to fund the Improvement Allowance jointly to Tenant, its general contractor, and,
at Landlord's option, to any subcontractors or suppliers.
3. Span Plan and Snorifiratinnr
a. No later than ten (10) days after the date of this Work Agreement set forth above,
Tenant shall submit two (2; sets of a "Space Plan" (as described in Section 16 below) to Landlord for
approval.
b. Landlord shall, within ten (10) days after receipt thereof, either approve said Space
Plan, or disapprove the same advising Tenant of the reasons for such disapproval. In the event Landlord
disapproves said Space Plan, Tenant shall modify the same, taking into account the reasons given by
Landlord for said disapproval, and shall submit two (2) sets of the revised Space Plan to Landlord within five
(5) days after receipt of Landlord's initial disapproval.
a. No later than twenty (20) days after receipt of Landlord's approval of the Space
Plan, Tenant shall submit to Landlord for approval two (2) sets of "Working Drawings" (as defined in Section
16 below), and a report (the "Engineering Report") from Tenant's mechanical, structural and electrical
engineers indicating any special heating, cooling, ventilation, electrical, heavy load or other special or unusual
reauirements of Tenant.
and submit revised Working Drawings
given by Landlord for disapproval, and a revised Engineering Report, taking into account the reasons
, within five (5) days after receipt of Landlord's initial disapproval.
5. Landlord's Approves Landlord shall not unreasonably withhold approval of any Space
Plans, Working Drawings, or Engineering Report submitted hereunder if they provide for a customary
with finishes and materials generally conforming to building standard finishes and
materials currently being used by Landlord at the Property, are compatible with the Property's exterior
construction, and if no modifications will be required for the Property's electrical, heating, air conditioning,
ventilation, plumbing, fire protection, life safety, or other systems or equipment, and will not require any
structural modifications to the Property whether required by heavy loads or otherwise,
6. Space PlannPrc Arrhitartc ?inoars and r The Space Plan, Working
Drawings, Engineering Report and the Work, shall be prepared and performed by such space planners,
architects, engineers and contractors as Landlord customarily engages or recommends for use at the
Property; provided, Tenant may substitute another licensed, bonded, reputable and qualified space planner,
architect, engineer or contractor, who will work in harmony with each other and those of Landlord so as to
ensure proper maintenance of good labor relationships. Such substitutions may be made only with
Landlord's prior written approval. Such approval shall be granted or denied within ten (10) days after
Landlord receives from Tenant a written request for such substitution, containing a reasonable designation of
the proposed party's background, references and qualifications. Any such substitution shall not serve to
delay the times for submission of the Space Plan, Working Drawings and Engineering Report required
herein, except to the extent that Landlord delays granting or denying approval beyond the aforementioned
ten (10) day period.
7, Gbange CuLerc No changes, modifications, alterations or additions to the approved Space
Plan or Working Drawings may be made without the prior written consent of the Landlord after written request
therefor by Tenant. In the event that the Leased Premises are not constructed in accordance with said
approved Space Plan and Working Drawings, then Tenant shall not be permitted to occupy the Leased
Premises until the Leased Premises reasonably comply in all aspects with said approved Space Plan and
Working. Drawings; in such case, the Rent shall nevertheless commence to accrue and be payable as
otherwise provided in the Lease.
6. rmmp? lianrp Tenant's Work shall comply in all respects with the following: (a) the Building
Code of the City and State in which the Building is located and State, County, City or other laws, codes,
ordinances and regulations, as each may apply according to the rulings of the controlling public official, agent
or other such persons, (b) applicable standards of the National Board of Fire Underwriters and National
Electrical Code, and (c) building material manufacturer's specifications.
9. Guaraateari Each contractor, subcontractor and supplier participating
shall guarantee that the portion thereof for which he is responsible shall be free from any defects in
workmanship and materials for a period of not less than one (1) year from the date of completion thereof.
Every such contractor, subcontractor, and supplier shall be responsible for the replacement or repair, without
additional charge, of all work done or furnished in accordance with its contract which shall become defective
within one (1) year after completion thereof. The correction of such work shall include, without additional
charge, all additional expenses and damages in connection with such removal or replacement of all or any
part of Tenant's Work, and/or the Property and/or Common Areas, or work which may be damaged or
disturbed thereby. All such warranties or guarantees as to materials or workmanship of or with respect to
Tenant's Work shall be contained in the contract or subcontract which shall be written such that said
warranties or guarantees shall inure to the benefit of both Landlord and Tenant, as their respective interests
may appear, and can be directly enforced by either. Tenant covenants to give Landlord any assignment or
other assurances necessary to effect such right of direct enforcement. Copies of all contracts and
subcontracts shall be fumished to Landlord promptly after the same are entered.
10. Pprformanre.:
a. Tenant's Work shall be commenced within fifteen (15) days after Landlord approves
the Working Drawings, and shall thereafter be diligently prosecuted to completion, subject to delays for
reasons beyond Tenant's control (except financial matters). All Work shall conform with the Working
Drawings approved by Landlord in writing, and Landlord may periodically inspect the Work for such
compliance. Tenant's Work shall be coordinated under Landlord's direction with the work being done or to be
performed for or by other tenants in the Property so that Tenant's Work will not interfere with or delay the
completion of any other construction work in the Property.
TPnanf'c %A/nrk chall ho nnrfnrmnra h ILnr ,,nF l.. -f- C-4 „i,,,,,, -_A ?. ci.
C. Tenant shall be required to obtain and pay for all necessary permits and/or fees with
respect to Tenant's Work, and the same shall be shown to Landlord prior to commencement of the Work.
d. Each contractor and subcontractor shall be required to obtain prior written approval
from Landlord for any space outside the Leased Premises within the Property, which such contractor or
subcontractor desires to use for storage, handling, and moving of his materials and equipment, as well as for
the location of any facilities for his personnel.
e. The contractors and subcontractors shall be required to remove from the Leased
Premises and dispose of, at least once a week and more frequently as Landlord may direct, all debris and
rubbish caused by or resulting from the construction. Upon completion of Tenant's Work, the contractors and
subcontractors shall remove all surplus materials, debris and rubbish of whatever kind remaining within the
Property which has been brought in or created by the contractors and subcontractors in the performance of
Tenant's Work. If any contractor or subcontractor shall neglect, refuse or fail to remove any such debris,
rubbish, surplus material or temporary structures within two (2) days after notice to Tenant from Landlord with
respect thereto, Landlord may cause the same to be removed by contract or otherwise as Landlord may
determine expedient, and charge the cost thereof to Tenant as Additional Rent under the Lease.
f. Tenant shall obtain and furnish Landlord all approvals with respect to electrical,
water and telephone work as may be required by the respective company supplying the service. Tenant
shall obtain utility service, including meter from the utility company supplying service, unless Landlord elects
to supply service and/or meters.
g. Landlord shall have the right to require Tenant to furnish bonds or other security in
form and amount reasonably satisfactory to Landlord for the prompt and faithful performance and payment
for Tenant's Work.
h. Landlord's acceptance of Tenant's Work as being complete in accordance with the
approved Space Plan and Working Drawings shall be subject to Landlord's inspection and written approval.
Tenant shall give Landlord five (5) days prior written notification of the anticipated completion date of Tenant's
Work.
i. If contemplated or permitted under the statutes of the State in which the Property is
located, within ten (10) days after completion of construction of Tenant's Work, Tenant shall execute and file
a Notice of Completion with respect thereto.
j. Tenant shall, at its cost and expense construct, purchase, install and perform any
and all items of Tenant's Work, stock its merchandise, and employ its personnel so as to obtain any
governmentally required certificate of occupancy and to occupy the Leased Premises as soon as possible,
and in all cases on or before the date required therefor hereunder or under the Lease.
k. If an expansion joint occurs within the Leased Premises, Tenant shall install finish
floor covering to or covering such joint in a workmanlike manner, and Landlord shall not accept responsibility
for any finish floor covering applied to or installed over the expansion joint.
1. Copies of "as built" drawings shall be provided to Landlord no later than thirty (30)
days after completion of the Work.
M. Landlord's approval of Tenant's plans and specifications, and Landlord's
recommendations or approvals concerning contractors, subcontractors, space planners, engineers or
architects, shall not be deemed a warranty as to the quality or adequacy of the Work, or the design thereof,
or of its compliance with laws, codes and other legal requirements.
n. Tenant shall conduct its labor relations with employees so as to avoid strikes,
picketing, and boycotts of, on or about the Leased Premises or Property. If any employees strike, or if picket
lines or boycotts or other visible activities objectionable to Landlord are established, conducted or carried out
against Tenant, its employees, agents, contractors, subcontractors or suppliers, in or about the Leased
Premises or Property, Tenant shall immediately close the Leased Premises and remove or cause to be
removed all such employees, agents, contractors, subcontractors and suppliers, in or about the Leased
Premises or Property, Tenant shall immediately close the Leased Premises and remove or cause to be
removed all such employees, agents, contractors, subcontractors and suppliers until the dispute has been
settled.
I anHlr)rH shall not ho rasnnncihla fnr =nit rfich trhon- nr Hafirianrv nmWari in fha nir
P. If performance of the Work shall require that additional services or facilities be
provided, Tenant shall pay Landlord's reasonable charges therefor,
q. Tenant's contractors shall comply with the rules of the Property and Landlord's
requirements respecting the manner of handling materials, equipment and debris. Demolition must be
performed at such times as Landlord determines in its sole judgment as least disruptive to the Building
tenants. Delivery of materials, equipment and removal of debris must be arranged to avoid any
inconvenience or annoyance to other tenants. The Work and all cleaning in the Leased Premises must be
controlled to prevent dirt, dust or other matter from infiltrating into adjacent tenant or mechanical areas or the
parking lots.
r. Landlord may impose reasonable additional requirements from time to time in order
to ensure that the Work, and the construction thereof does not disturb or interfere with any other tenants of
the Property, or their visitors, contractors or agents, nor interfere with the efficient, safe and secure operation
of the Property.
11. insurance All contractors and subcontractors shall carry Worker's Compensation Insurance
covering all of their respective employees in the statutory amounts, Employer's Liability Insurance in the
amount of at least $500,000 per occurrence, and comprehensive general liability insurance of at least
$3,000,000 combined single limit for bodily injury, death, or property damage; and the policies therefor shall
cover Landlord, Tenant, as additional insureds, as well as the contractor or subcontractor. Tenant shall carry
builders risk insurance coverage respecting the construction and improvements to be made by Tenant, in the
amount of the anticipated cost of construction of the Work (or any guaranteed maximum price). All insurance
carriers hereunder shall be rated at least A and X in Best's Insurance Guide. Certificates for all such
insurance shall be delivered to Landlord before the construction is commenced or contractor's equipment is
moved onto the Property. All policies of insurance must require that the carrier give Landlord twenty (20)
day's advance written notice of any cancellation or reduction in the amounts of insurance. In the event that
during the course of Tenant's Work any damage shall occur to the construction and improvements being
made by Tenant, then Tenant shall repair the same at Tenant's cost.
12. Signag- 'The content of all signage shall be subject to Landlord's prior written approval. No
other signage may be installed or placed outside the Leased Premises by Tenant unless installed in
accordance with the Landlord's signage criteria.
13. Asbestos If the Property was constructed at a time when asbestos was commonly used in
construction, Tenant acknowledges that asbestos-containing materials ("ACM") may be present at the
Property, and that airborne asbestos fibers may involve a potential health hazard unless proper procedures
are followed. In such case, before commencing the Work, Tenant and its contractor shall consult with
Landlord and Landlord's asbestos consultant concerning appropriate procedures to be followed. Landlord
shall, at Tenant's expense, undertake any necessary initial asbestos-related work, before Tenant
commences the work. During performance of the Work, Tenant shall require that its contractor comply with
all laws, rules, regulations and other governmental requirements, as well as all directives of Landlord's
asbestos consultant, respecting ACM. Tenant hereby irrevocably appoints Landlord and Landlord's asbestos
consultant as Tenant's attoney-in-fart for purposes of supervising and directing any asbestos-related
aspects of the Work (but such appointment shall not relieve Tenant from its obligations hereunder, not
impose any affirmative requirement on Landlord to provide such supervision or direction).
14. I ie Tenant shall keep the Property and the Leased Premises free from any mechanic's,
materiaiman's or similar liens or other such encumbrances in connection with the Work, and shall indemnify
and hold Landlord harmless from and against any claims, liabilities, judgments, or costs (including attorneys'
fees) arising in connection therewith. Tenant shall give Landlord notice at least twenty (20) days prior to the
commencement of the Work (or such additional time as may be necessary under applicable laws), to afford
Landlord the opportunity of posting and recording appropriate notices of non-responsibility. Tenant shall
remove any such lien or encumbrance by bond or otherwise within thirty (30) days after written notice by
Landlord, and if Tenant shall fail to do so, Landlord may pay the amount necessary to remove such lien or
encumbrance, without being responsible for investigating the validity thereof. The amount paid shall be
deemed Additional Rent under the Lease payable upon demand, without limitation as to other remedies
available to Landlord under the Lease. Nothing contained herein shall authorize Tenant to do any act which
shall subject Landlord's title to the Property or Leased Premises to any liens or encumbrances whether
claimed by operation of law or express or implied contract. Any claim to a lien or encumbrance upon the
Property or Leased Premises arising in connection with the Work shall be null and void, or at Landlord's
option shall attach only against Tenant's interest in the Leased Premises and shall in all respects be
subordinate to Landlord's title to the Property and Leased Premises.
Work, or Tenant's failure to comply with the provisions hereof, or any failure by Tenant's contractors,
subcontractors or their employees to comply with the provisions hereof, except to the extent caused by
Landlord's intentional or negligent acts.
16. f_prtnin r)pfinitinnc
a. "Space Plan" herein means a layout plan, drawn to scale, showing (1) demising
walls, interior partition walls and interior doors, including any special walls, glass partitions or special features,
(2) any restrooms, kitchens, computer rooms, and other special purpose rooms, and any sinks or other
plumbing facilities, or other special facilities or equipment, (3) any communications system, indicating
telephone and computer outlet locations, and (4) any other details or features required to reasonably
delineate the Work to be performed.
b. "Working Drawings" herein means fully dimensioned architectural construction
drawings and specifications, and any required engineering drawings (including mechanical, electrical,
plumbing, air-conditioning ventilation and heating) and shall include any applicable items described above for
the Space Plan, and if applicable: (1) electrical outlet locations, circuits and anticipated usage therefor, (2)
reflected ceiling plan, including lighting, switching, and any special ceiling specifications, (3) duct locations for
heating, ventilating and air-conditioning equipment, (4) details of all millwork, (5) dimensions of all equipment
and cabinets to be built in (6) furniture plan showing details for space occupancy, (7) keying schedule, (8)
lighting arrangement, (9) location of any major equipment or systems (with brand names wherever possible)
which require special consideration relative to air-conditioning, ventilation, electrical, plumbing, structural, fire
protection, life-fire-safety system, or mechanical systems, (10) special heating, ventilating and air conditioning
equipment and requirements, (11) weight and location of heavy equipment, and anticipated loads for special
usage rooms, (12) demolition plan, (13) partition construction plan, (14) type and color of floor and wall-
coverings, wall paint and any other finishes, and any other details or features required to completely delineate
the Work to be performed and (15) a site plan, if applicable, including landscaping, and exterior signage.
17. Taxes: Tenant shall pay prior to delinquency all taxes, charges or other governmental
impositions (including without limitation, any real estate taxes or assessments, sales tax or value added tax)
assessed against or levied upon Tenant's fixtures, furnishings, equipment and personal property located in
the Leased Premises and the Work to the Leased Premises under this Agreement. Whenever possible,
Tenant shall cause all such items to be assessed and billed separately from the property of Landlord. In the
event any such items shall be assessed and billed with the property of Landlord, Tenant shall pay its share of
such taxes, charges or other governmental impositions to Landlord within thirty (30) days after Landlord
delivers a statement and a copy of the assessment or other documentation showing the amount of such
impositions applicable to Tenant.
18. INCORPORATED INTO LEASE; DEFAULT. THE PARTIES AGREE THAT THE
PROVISIONS OF THIS WORK AGREEMENT ARE HEREBY INCORPORATED BY THIS REFERENCE
INTO THE LEASE FULLY AS THOUGH SET FORTH THEREIN. In the event of any express
inconsistencies between the Lease and this Work Agreement, the latter shall govern and control. If Tenant
shall default under this Work Agreement, Landlord may order that all Work being performed in the Leased
Premises be stopped immediately, and that no further deliveries to the Leased Premises be made, until such
default is cured, without limitation as to Landlord's other remedies. Any amounts payable by Tenant to
Landlord hereunder shall be paid as Additional Rent under the Lease. Any default by the other party
hereunder shall constitute a default under the Lease and shall be subject to the remedies and other
provisions applicable thereto under the Lease. If Tenant shall default under the Lease or this Work
Agreement and fail to cure the same within the time permitted for cure under the Lease, at Landlord's option,
all amounts paid or incurred by Landlord towards the Improvement Allowance shall become immediately due
and payable as Additional Rent under the Lease.
LANDLORD:
By: Date:
Title:
TENANT:
EXHIBIT E
GUARANTY
THIS GUARANTY ("Guaranty") is made this day of 2006, by and between
Kenneth R. Paton and W. Douglas Waardenburg (Individually "GuarantP'and collectively "Guarantors") and
Alpha Omega Limited, LLC ("Landlord"), with respect to certain present and future obligations of Zur, LTD
("Tenant").
WHEREAS, Tenant wishes to enter into a Building Lease (the "Lease") between Tenant and
Landlord (all obligations of Tenant under the Lease, whether now existing or hereafter incurred, whether
direct, indirect, contingent or fixed, whether incurred as primary obligor, co-maker, endorser, or guarantor,
whether otherwise guaranteed or secured, and whether on open account, evidenced by a written instrument
or otherwise, are collectively referred to as the "Obligations"), and
WHEREAS, Landlord has required additional assurances of Tenant's performance of the Obligations
as a condition of entering into the Lease.
NOW, THEREFORE, in consideration of good and valuable consideration and in order to induce
Landlord to enter into the Lease, the parties agree as follows:
1. Gua[angc Each of the Guarantors jointly and severally guarantee to Landlord the prompt
performance when due of the Obligations, including without limitation payment of all sums due under the
Lease, plus any interest, penalties, and collection fees thereon. Each of the Guarantors agrees to make
such payments to Landlord and perform any non-monetary Obligations, if there is any default in the payment
or the performance of the Obligations.
2. Nature of G1iaranty This is a continuing, unconditional Guaranty and the liability of each of
the Guarantors to Landlord is not limited to a proportionate part of the total liability of the Tenant to Landlord.
This is a guaranty of payment and not of collection, and each of the Guarantors waives any right to require
that any action be brought against the Tenant, or any other Guarantor, or to require that Landlord proceed
against any security, or any other person, and agrees that Landlord assumes no responsibility for the validity
or enforceability of any security for the Obligations.
3. Si bmgafinn' As a material inducement for Landlord to accept this Guaranty and enter into
the Lease, the Guarantors represent and warrant that they have no right of indemnification from or against
Tenant, any such right being waived. In lieu of any other remedy the Guarantors may have against Tenant,
the Guarantors shall be subrogated to the rights of Landlord against Tenant; provided that none of the
Guarantors shall be subrogated to, or may enforce on the part or behalf of any of the Guarantors, any right of
action which Landlord may have against the Tenant until the Obligations shall have been paid in full.
q. C bnditinnc Pro_rartenh Each of the Guarantors represents and warrants that his liability
under this Guaranty is not contingent or conditional upon any other person signing this Guaranty or the
obtaining or perfecting of any security for the Obligations, or any other condition precedent or subsequent.
5. Changes Affecting the Obligations Landlord may, from time to time, either before or after
the death of any of the Guarantors, or any default by the Tenant, with or without further notice to any of the
Guarantors, renew or extend the time of payment of the Obligations, and grant and allow such indulgences,
modifications, or compromises in connection therewith as it deems advisable or expedient, and may change,
renew, extend, surrender, impair, or compromise, in whole or in part, any security at any time held by or
available to Landlord for the Obligations or for any obligation of any other person secondarily or otherwise
liable on the Obligations, intentionally or unintentionally, or may waive, release, extend, or modify the rights of
any of the Guarantors, without impairing the enforceability of this Guaranty. The death, disability, or
discharge in bankruptcy of the Tenant or any of the Guarantors shall not affect the liability of any remaining
Guarantors.
6. rpctc of C:nllertinn Each of the Guarantors shall, upon demand, pay all costs and
expenses incurred by Landlord in connection with the enforcement or collection of the Obligations or the
enforcement of this Guaranty, including attorneys' fees and disbursements. In determining attorneys' fees,
the parties deem the following to be reasonable: the greater of either (a) twenty-five percent ( 15%) of the
amount due at the time payment is made, including all past due interest, costs, and fees, or (b) $1,500 in fees
if the matter is litioated hefnre n nictrirt Ji mfira nr as nnn in foes if tho matter ic titinotori in tho r,,,,rt ^f
respect to any amounts. that Landlord may ever be required to repay under any bankruptcy or insolvency
laws.
8. Waivers of Hnmesteari Notice Each of the Guarantors hereby waives the benefit of any
homestead exemption and notice of acceptance of and demand for payment as to this Guaranty and also
waives notice of any default in the Obligations or of action taken in connection therewith. To the extent any
notice may not be legally waived, each Guarantor appoints the Tenant his or her attorney-in-fact for the
delivery of any notice, and any notice delivered to the Tenant shall be deemed received by each of the
Guarantors.
g DelaygWaivPr_ - bTantilorrr No delay on the part of Landlord in exercising any rights
hereunder or under the Lease or any failure to exercise the same shall operate as a wavier of such rights; no
notice to or demand on the Guarantors shall be deemed to be a waiver of the obligations of the Guarantors or
of the right of Landlord to take further action without notice or demand as provided herein.
10. Mndafiratinn Waiver of this Glaranty No modification or waiver of the provisions of this
Guaranty, including the provisions of this paragraph, shall be effective unless in writing and signed by
Landlord; nor shall any waiver be applicable except in the specific instance for which it is given.
11. Sources-of Information The Guarantors warrant that they have adequate means to obtain
from the Tenant, now and on a continuing basis, all necessary and desirable information concerning the
status of the Obligations and the financial condition of the Tenant, and they are not relying on the Landlord to
provide such information, either now or in the future.
12 Financial Information- Upon Landlord's reasonable requests from time to time, each of the
Guarantors shall provide Landlord with financial information covering such periods and in such form as is
satisfactory to Landlord.
13, nM lifir_afions to i ease: Landlord may make such modifications and additions to the Lease
and the Obligations as Landlord may deem advisable, including without limitation, extending the term of the
Lease, increasing or decreasing payments under the Lease, or allowing Tenant to assign or delegate its
duties under the Lease, and the same shall not release any Guarantor or in any way limit the liability of any
Guarantor, this Guaranty expressly extending to such modifications and extensions.
14. Notices Any notice or other communication required or permitted by this Guaranty shall be
in writing and shalt be deemed given when hand delivered or deposited in the United States mail, postage
prepaid, via first class or certified mail, and addressed to the parties as follows:
If to Landlord Aloha Omega, LLC
P. O. Box 3555
Camp Hill, PA 17011
With a copy to: Attorney Mark Thomas.
101 South Market Street
Mechanicsburg, PA 17055
If to Guarantor(s): Kenneth R. Paton
6B Round Ridge Road
Mechaniscburg, PA 17055
W. Douglas Waardenburg
2230 Canterbury Drive,
Mechanicsburg, PA 17055
With a copy to: Ralph H. Wright, Jr.
Johnson, Duffle, Stewart & Weidner
a n Rnv ino
15. FntirP AnrPPmen , This Guaranty constitutes the entire agreement between the parties with
respect to the subject matter of this Guaranty and supersedes and merges all prior negotiations, offers,
representations, warranties, and agreements with respect to the subject matter of this Guaranty. No course
of prior dealing between the parties, no usage of trade, and no parol, extrinsic, or other outside evidence of
any nature shall be used to supplement, interpret, or modify any of the terms of this Guaranty.
18. SevRxatdaty. If any provision of this Guaranty is unenforceable, the remainder of this
Guaranty shall continue in effect and be construed as if the unenforceable provision had not been contained
in this Guaranty. Each provision of this Guaranty shall be valid and enforceable to the fullest extent permitted
by law.
17. C„ccessnrs and Assigns This Guaranty shall be binding upon and inure to the benefit of
the parties and their respective heirs, personal representatives, successors, and assigns.
18. Venue Regardless of what venue would otherwise be permissive or required, the parties
stipulate that all actions arising under or affecting this Guaranty shall be brought in the Court of Common
PlPac of riimhPrland Count Pennsylvania, the parties agreeing that such forum is mutually convenient and
bears a reasonable relationship to this Guaranty.
19. CnneP^t to .liiricdirtion ^nri Se ;rP of P rP The parties irrevocably submit to the
jurisdiction of the state courts of the Commonwealth of t?ennsvlvanla a
States District Court for the Middle District of Penns I T' nd to the jurisdiction the United
yania,
proceeding arising under or affecting this Guaranty. for the purpose of any suit, action, or other
20. Number and GPnriPr When used in this Guaranty, the singular includes the plural, the
plural includes the singular, and the use of any gender includes any other gender, as circumstances may
require. The term "person' includes both natural persons and entities.
21. Headings: The headings contained in this Guaranty are for the convenience of the parties
only, and are not a part of the substantive agreement of the parties nor shall they affect the meaning or
interpretation of any provision of this Guaranty in any way.
22. Counterparts- erparts_- This Guaranty may be executed in multiple counterparts. When at least one
copy of this Guaranty has been executed by each part of this Guaranty, this Guaranty shall be in full force
and effect, and all of such counterparts shall be read together as a single agreement.
23. Advice from I_ ?dnPndent Caunsp- The parties understand that this is a legally binding
contract that may affect their rights. Each party represents that he has entered into this Guaranty freely and
voluntarily and without coercion of any kind whatsoever, and has had the opportunity to consult with
independent counsel.
24. (',OVFRNINC' , r AVV ALL MATTERS REGARDING THE FORMATION,
INTERPRETATION, AND ENFORCEMENT OF THIS GUARANTY SHALL BE GOVERNED BY
PFNNSYI VANIA LAW, EXCLUDING ITS LAWS RELATING TO CHOICE OF LAW.
IN WITNESS WHEREOF, the Guarantors have executed this Guaranty as of the day and year first
above written.
INDIVIDUAL GUARANTORS (If applicable):
Kenneth R. aton
?oi,y' s Waardenbyr
EXHIBIT
9
LEASE AGREEMENT for Space at 3825 Hartzdale Drive, Camp Hill, PA 17011
THIS LEASE AGREEMENT ("Lease") is made this _ day of February, 2006, between
Landlord: Alpha Omega Unlimited, LLC with contact address as 49 Tannery Road, Dillsburg, PA 17019
Tenant: Zur LTD, with contact address as 2230 Canterbury Drive, Mechanicsburg, PA, 17055.
WITNFRSFTH-
1. Definitions. The following definitions shall apply to the indicated terms, whenever used in
this Lease. Additional defined terms may be found in the body of the Lease.
(a) Landlord: nn,a a (jnlimifarl I I
do CharlPC and Virki Firhfnpr
49 Tanney Road
(b) Dillchwg PA 17019
Tenant: 71 IR In
2230 Canterbury Drive
Mechanicsburg, PA 17055
(c) Leased Premises: Approx 5,.760 square feet
(d) Permitted Use: Office
(e) Lease Commencement Date: 3/1/2006
All prorata CAM, Taxes and Insurance charges are due beginning on the lease commencement date.
(f) Rent Commencement Date: 2/10/2006
(g) Term: I years n months
(h) Minimum Rent: $5,000 per month with no increase for the term of the lease.
(i) None, unless otherwise mutually agreed.
See Option Rider, if applicable. All Renewal Periods shall be included in the definition of the Term.
(j) Percentage of Common Area Charge ("CAM"): 10.5%
Initial Annual Amount ($12,000.00) $1260/year
(k) Percentage of Capital Improvements Fund 10.5%
Initial Annual Amount ($12A0
00
.
) $year
(I) Security Deposit: Jt 41uJ
I
I
Y?
(m)
?
Y
Insurance Payment ("Ins."):
10.5% ?
Initial Annual Amount ($5,000.00) $525/year
(n) Tax Payment ('Tax"): 10.5%
Initial Annual Amount ($40,000.00 $4200/year
N rly?ir<j (Zbi?ict/Al"'WIAmi55ago,cb /01 51,119 _?, 7731,,L ,
?O
(o) ?
To Landlor :
Alpha Omega
I
P. O. Box 3555
? rye Camp Hill, PA 17011
With a copy to: Attorney Mark Thomas
101 South Market Street
Mechanicsburg, PA 17055
Landlord's Initials:
r
Tenant's Initials:,
To Tenant: ?
2230 Canterbury DriAv
Page
I
Mechanicsburg, PA.
17055
With a copy to: Ralph H. Wright, Jr.
Johnson, Duffle, Stewart &
Weidner
P.O. Box 109
Lemoyne, PA 17043-0109
?? (J Attachments: Exhibit A - Floor Plan
Exhibit B - Signage Criteria
Exhibit C - Rules and Regulations
Exhibit D - Delivery of Documents
Exhibit E - Build Out Rider
Exhibit F - Guaranty
Premises.
necrripripn of Premises Landlord leases to Tenant, and Tenant leases from Landlord, the
Leased Premises described in Section 1. The Leased Premises is outlined in red on a diagram of the
Building attached hereto and incorporated herein as Exhibit "A." Exhibit "A" sets forth the general layout of
the Building and shall not be deemed a warranty on the part of Landlord that the Building is or will be exactly
as indicated on such diagram. Landlord may increase, reduce, or change the number, dimensions, and
locations of roadways, walks, buildings, and parking areas as Landlord from time to time deems proper.
Tenant's occupancy of the Leased Premises shall include the use in common with others entitled thereto of
such parking areas, service roads, sidewalks, signs, equipment facilities, service areas, hallways, doors,
stairwells, and the like (the "Common Areas") as Landlord may from time to time, make available to Tenant
for use in common with others, subject, however, to the terms and conditions of this Lease and to all rules
and regulations for the use thereof as may from time to time be prescribed by Landlord.
3. Use of i eased PrPmicec;-?. The Leased Premises shall be used solely for the
Permitted Use indicated in Section 1, and for no other purpose. Tenant shall operate such a business in the
Leased Premises at all times during the Term. Tenant shall conduct its business in the Leased Premises
under its Legal name or the Trade Name indicated in Section 1. Tenant shall not change its Trade Name or
Legal name without prior notice to Landlord.
4. Term. The Initial Term of this Lease shall begin on the "Lease Commencement Date" , so
set forth on page 1 of this Lease unless otherwise stated here. The phrase "Term" as used in this Lease
shall mean the Initial Term and all renewal terms (if there are any) exercised.
5. Bent.
(a) Minimum Rent. Tenant shall pay, as rent for the Leased Premises, the Minimum Rent
indicated in Section 1 If the Commencement Date is not the first day of the month, rent for that month shall
be prorated. If any rent or other sum is not received by Landlord within ten (10) calendar days after its due
date, Tenant shall pay a late charge of ten percent (10%) of the overdue amount. If any payment under this
Lease is made by check and such check is returned by the payor for any reason, Tenant shall pay a returned
check charge of One Hundred Dollars ($100.00). In addition, any rent or other sum not received by Landlord
when due shall bear interest from the due date to the payment date at the prime rate published from time to
time by the Wall Street Journal, plus two (2%). Landlord reserves the right to require cashier's check,
certified check, money order, or cash, and may refuse Tenant's check in Landlord's sole discretion.
(b) (nmmnn area Charge. Tenant shall pay as Additional Rent its pro-rata share of the cost of
operating, replacing improving, maintaining, repairing, and refurbishing the Common Areas ("Common Area
Charge"), which for purposes of this Section only, shall include all roofs of the Building. Such costs shall
include, without limitation, materials, supplies, equipment, and services purchased or hired; equipment used
for the maintenance of the Common Areas; landscaping, gardening, planting, cleaning, painting, striping
parking areas, repaving, lighting, and sanitation; removing snow, ice, and garbage; heating, ventilating, and
air-conditioning the enclosed areas other than the Leased Premises; fire protection and on-site security if
provided by Landlord in its sole discretion), water and sewage charges, storm water maintenance fees,
electricity and other utility services; costs of personnel, payments to governmental authorities, costs of
complying with rules and regulations of governmental authorities, Fire Insurance Rating Organizations, Board
of Fire Underwriters, insurance carriers, and other organizations having jurisdiction over the Building; and
Landlord's administrative osts (including any management fee payable Landlord) in connection with the
Landlord's Initials Tenant's InitialsZ7 Page
2
operation of the Building ("Common Area Costs"). Landlord and Tenant agree that improvements performed
to the front of the Building primarily for the benefit of the retail sore currently known as Servant's Heart shall
be excluded for purposes of computing the Common Area Charge.
Tenant's prorata share of the Common Area Charge shall be paid by Tenant in monthly installments
in such amounts as are estimated and billed by Landlord at the beginning of each twelve (12) month period
commencing and ending on dates designated by Landlord, each installment being due on the first day of
each calendar month. At any time during any such twelve (12) month period, Landlord may re-estimate
Tenant's proportionate share of the Common Area Charges and thereafter adjust Tenant's monthly
installments payable during such twelve (12) month period to reflect more accurately Tenant's proportionate
share of the Common Area Charges. At the end of each twelve (12) month period, Landlord shall deliver to
Tenant a statement of the actual Common Area Charges for that twelve (12) month period. For the next
twelve (12) months, the monthly Common Area Charges will be adjusted to reflect the actual Common Area
Charges for the preceding twelve (12) months, plus the deficiency in Common Area Charges for the
preceding twelve (12) months based upon Tenant's proportionate share of that deficiency. Tenant shall have
the option to pay its entire proportionate deficiency within thirty (30) days should Tenant so choose. At the
end of the initial term, or any renewal thereof, Tenant will pay its proportionate share of any deficiency within
twenty (20) days following receipt of notice from Landlord of the Tenant's proportionate share. If, at the end
of any twelve month period, Tenant has paid more than Tenant's proportionate share of the actual Common
Area Charges for such period, such overage shall be credited as a payment toward Tenant's, proportionate
share of Common Area Charges for the following twelve month period. Upon reasonable notice, Landlord
shall make available for Tenant's inspection (which inspection shall be at Tenant's sole cost and expense) at
Landlord's office, during normal business hours, Landlord's records relating to the Common Area Charges for
such preceding twelve (12) month period. Failure of Landlord to provide the statement called for hereunder
within the time prescribed shall not relieve Tenant from its obligations hereunder.
(c) Capital Improvements Fund. The Common Area Charge, subsection (b) above, includes
the costs of repairs to the roof and/or installation of a new roof, resurfacing of parking lots, along with
repairs and/or replacement of the air conditioning unit(s) and heating system. These four (4) items could
result in a substantial "Common Area Charge" for the year in which any of these items would need to be
replaced. Therefore, a Capital Improvements Fund, (hereinafter the "Fund"), limited in purpose to the roof,
parking lot air conditioning unit(s) and heating system shalt be established. Tenant shall pay as Additional
Rent its pro-rata share of the Capital Improvements Fund on a monthly basis. The Fund is hereby capped
at $120,000.00, which amount is to be accumulated over a ten (10) year period. The determination of the
need for Capital Improvements to the four (4) items listed above shall be at the sole discretion of Landlord.
At any 4i I gRdlnFd
t . If expenditures from this Fund in any one (1)
year shall exceed the account balance of this Fund, Tenant's monthly pro rata payments to this Fund shall
be increased to make up the deficiency during the following twelve (12) months. If Tenant's initial term,
and any renewals thereof, shall expire before any expenditures are made from this Fund, Tenant shall not
be entitled to a refund of any contributions it has made to the Capital Improvement Funds. However,
should Landlord sell the real property herein to any third party not in any way related to Landlord, or its
members, Tenant shall be entitled to repayment of all its contributions to the Fund, minus ten (10%)
administration fees, plus its pro rata share of interest actually earned and accumulated in the Fund, minus
ten (10%) administration fees.
(d) Ina . During the Term, Tenant shall pay as Additional Rent a prorata portion of the annual
real estate taxes assessed against the Building & Property, as stated in section I subsection 4m) above. All
taxes assessed prior to the Term but payable in whole or in installments after the Commencement Date, and
all taxes assessed during the Term but payable in whole or in installments after the Term, shall be adjusted
and prorated, so Tenant shall pay its prorate share for the Term and Landlord shall pay its prorata share for
the periods prior and subsequent to the Term. If at any time during the Term, under the Laws of the state in
which the Building is located or any political subdivision thereof, a tax on rents is assessed against Landlord
in the form of a license tax or otherwise, such tax shall be deemed a real estate tax and shall be included
within the amount Tenant is required to pay. Tenant's prorata share of Real Estate Taxes may be reviewed,
adjusted and billed in the same manner set forth in Section 5, subsection (c) above.
(e) rompetitinn by vnant Tenant shall not directly or indirectly engage in any similar or competing
business to that conducted by Tenant in the Leased Premises within a radius of five (5) miles from the
Leased Premises. If Tenant violates this covenant, then in addition to all other remedies available to
Landlord, Tenant's gross sales in such similar or competing business shall be deemed Gross Sales and shall
be reported under this Section 5 for the period in which made, and Percentage Rent shall be calculated
thereon. For purposes of this subsection, Tenant shall be deemed to be indirectly engaging in a similar or
competing business if a stockholder or partner of Tenant, or Tenant, if an individual, or any family member of
any of the foregoing, shall have a financial interest in such similar or competing business or if, with Tenant's
consent, such similar or competing business is conducted under the same trade name as the business
conducted in the Leased Premises. (This section (e) does not include business currently being done by
tenant under e-church depot (sale of church-related products and Chr?i?s/tiian Literature,) AFIRM - consignment
Landlord's Initials: Tenant's initial6; Page
Y-d
t
product placing, and Wingspread Publishers (publication of Christian Literature); these business practices
done under tenant 7UR LTD.)
6, Pavements All rental and other payments shall be made to Landlord at the address, as
indicated in Section 1, subsection (n), until Landlord otherwise directs in writing. All charges, fees, and other
amounts due, other than Minimum Rent, shall be deemed Additional Rent. Unless otherwise provided in this
Lease or in writing, all payments of Minimum Rent and Additional Rent shall be payable monthly in advance
on or before the first day of each month during the Term, without prior demand and without offset, reduction,
defense, or counterclaim. All payments shall be made prior to the close of business (Eastern Standard Time)
on the date specified for such payment and in immediately available United States funds.
Security Deposit: (None)
g 7radp Fivtiiraa. Tenant shall have the right to install its trade fixtures in the Leased Premises,
provided such installation shall not interfere with either the construction of the Building or the completion of
any improvements to the Leased Premises which Landlord may have specifically agreed in this Lease to
perform, and such installation shall be at the sole risk and expense of Tenant. All trade fixtures installed in
the Leased Premises by Tenant shall remain the property of, and shall be removable by, Tenant at the
expiration of the Term, provided Tenant is not in default under this Lease, and Tenant shall promptly repair,
or reimburse Landlord for the cost of repairing all damages to the Leased Premises caused by the removal of
those fixtures.
g Gpbtrnl of rnmmnn Araac and Facilitiesh t anrihni, The Common Areas shall at all times
be subject to the exclusive control and management of Landlord, and Landlord shall have the right, from time
to time, to establish, modify, and enforce reasonable rules and regulations with respect to the Common
Areas. Without limiting the foregoing, Landlord shall have the right to construct, maintain, and operate
lighting facilities on all Common Areas; to police the same; to change, in Landlord's sole discretion, the area,
level, location, quantity, and arrangement, from time to time, of the Common Areas; to close or discontinue
common use of all or any portion of the Common Areas to such extent as may, in the opinion of Landlord or
Landlord's counsel, be legally sufficient, necessary, or proper to prevent a dedication or the accrual of any
rights to any person or the public; and to do and perform such other acts in and to the Common Areas as
Landlord, in its sole discretion, determines to be necessary to improve the convenience and use thereof by
tenants or their officers, agents, employees, and customers, or to improve the profitability of the Building.
Landlord will operate and maintain the Common Areas in such manner as Landlord, in its sole discretion,
shall determine from time to time. Without limiting the scope of such discretion, Landlord shall have the full
right and authority to employ all personnel and to make all rules and regulations pertaining to the proper
operation and maintenance of the Common Areas and facilities.
10. Llse-d Parking Areas,
(a) Ali automobile parking areas, driveways, entrances, and exits in or near the Building,
and other facilities furnished by Landlord in or near the Building, shall at all times be subject to Landlord's
exclusive control and management, and Landlord shall have the right from time to time to establish, modify,
and enforce reasonable rules and regulations with respect to all such facilities and areas.
(b) It is expressly understood that the parking areas in the Common Areas are intended
primarily for use by the Servant's Heart Retail Customers in the Building, and Tenant accordingly agrees that
its employees will not use those parking areas or any of the driveways, streets, or vacant land in the Building
for parking or storing any automobile, truck, or any other vehicle owned or used by any such employee,
except as Landlord may from time to time approve in writing, and with the further exception that Tenant, to
include Tenant's employees, may use the parking spaces in front of the building which are most remote from
the main entrance to the Servant's Heart Store in the event that parking elsewhere on the land adjacent to
the Building is unavailable, until such time as additional parking is made available on said land.
(c) Parking area in front of building is available expressly for retail customer use. Parking
for office employees is to be along the side of the building by receiving, except as provided otherwise in
Paragraph 10 (b). (Exceptions in the cases of any employees holding handicap passes.)
11. Maintr+nanrn lo I anrilnrd. Landlord shall, within a reasonable time after having received
written notice from Tenant of such a need, make such repairs to the roof, outside walls (except window,
storefront, and doors), gutters, and downspouts of the Building as may be necessary to keep the Building in
good condition and repair unless such repairs are caused by the negligence or willful act of Tenant or any of
its agents, employees, or contractors, in which event such repairs shall be made by and at the expense of
Tenant. Landlord will not be responsible for any damage resulting from any leak or defect in the roof,
sidewalls, gutters, or downspouts unless such damage is due to Landlord's failure to repair such defect within
a reasonable time after Landlord has received notice from Tenant of the need to repair such defect. Landlord
shall maintain in good condition and repair, and adequately light, the parking areas of the Building.
Landlord's Initials: Tenant's Initials: V Iyll Page
12. Maintenance by Tenant.
(a) General. Tenant shall, at its own cost and expense, keep in good condition and
repair the interior, windows, storefront, and doors of the Leased Premises and the appurtenances thereto,
including without limitation, toilets, plumbing lines, gas, electric lines, fixtures, and equipment, making such
replacements as may be necessary from time to time, it being expressly understood that Tenant shalt make
all repairs and replacements necessary to keep the Leased Premises and the appurtenances thereto in good
condition and repair except only those repairs which Landlord has expressly agreed under this Lease to
make. Tenant shall, at its own cost and expense, keep the Leased Premises and entryways, sidewalks,
driveways, and delivery areas adjacent to the Leased Premises clean and free from obstruction, garbage,
dirt, snow, and ice. Tenant shall store all garbage in fully-closed containers in the area designated by
Landlord, and Tenant shall pay all costs incident to the removal thereof. Tenant shall not burn or otherwise
dispose of any garbage in or about the Leased Premises. Tenant shall not tape windows or attach wood
coverings to aluminum frame windows.
13. SttndlV Couenantg of Tenant, Tenant shall: (a) comply with all federal, state, and municipal
laws, ordinances, and regulations relating to the Leased Premises and its Permitted Use, including, without
limitation, all environmental laws, rules and regulations (collectively the "Environmental Laws") and all laws,
rules and regulations in connection with the Americans with Disabilities Act of 1990, as amended (the "ADA");
(b) notify Landlord immediately upon receipt of all notices or other communications by governmental
authorities regarding possible or actual noncompliance with laws, ordinances, or regulations; (c) pay promptly
for all electricity, water, and other utilities consumed on or in connection with the Leased Premises, and all
sewage disposal charges assessed against the Leased Premises; (d) not use or permit to be used any
advertising medium or device, such as phonograph, radio, or public address system (except for the public
address / intercom system which serves the interior of the Leased Premises), without Landlord's prior written
consent; (e) not use or permit to be used the Leased Premises for any illegal or immoral purpose; (f) not hold
any fire, bankruptcy, going out-of-business, or auction sales without Landlord's prior written consent; (g) not
use the sidewalks or any other portions of the Common Areas for any purpose relating to the selling of
merchandise or services; and (h) keep the Leased Premises free from insects, pests, and vermin of all kinds,
and for that purpose Tenant shall use, at Tenant's cost, such pest extermination contractor as Landlord may
direct and at such intervals as Landlord may require.
The Leased Premises shall not be used for the treatment, storage, use, or disposal of toxic or
hazardous wastes or substances, or any other substance, exposure to which is prohibited, limited, or
regulated by a governmental or quasi-governmental authority or which, even if not so regulated, could or
does pose a hazard to the health and/or safety of the occupants of the Building or surrounding property.
Tenant shall indemnity and hold Landlord harmless from and against any expense or liability (including
attorney's fees) arising under the Environmental Laws resulting from Tenant's use of the Leased Premises or
any acts and/or omissions of Tenant, its agents, employees, invitees, or independent contractors.
14. I mnrnvamonte,
Tenant is accepting the Leased Premises "as is", and Tenant shall pay the cost of any improvements
or alterations desired by Tenant. Any such improvements or alterations to the Leased Premises shall be
performed only after Tenant has obtained the prior written consent of Landlord, which consent may be
withheld for any or no reason. Tenant has inspected the Leased Premises and is satisfied with its physical
condition. Any improvements or alterations to the Leased Premises in addition to those specified on the
Build-Out Rider shall be performed at Tenant's expense, and only after Tenant has obtained the prior written
consent of Landlord, which consent may be unreasonably withheld.
15. Cnmpl annp with Amerdranc with n_ieyahil;rfoc Art of 1990 Tenant acknowledges it is a
"public accommodation" as defined by the ADA. If the ADA requires that action be taken with respect to the
Leased Premises (not including the Common Areas), including without limitation removing barriers and
altering the Leased Premises in accordance with the ADA Accessibility Guidelines, such action shall be taken
by Tenant; provided, however, that if such action was required to be taken during Landlord's build-out (if
applicable) of the Leased Premises, Landlord shall take such action. Tenant shall notify Landlord
immediately upon receipt of an oral or written complaint or notice by an employee, customer, client, invitee,
licensee, or governmental authority regarding the ADA.
16. Aceinnment and Snhiettinn. Without Landlord's prior written consent, Tenant shall not
(either voluntarily, involuntarily, or by operation of Law) assign, transfer, mortgage, pledge, hypothecate, or
encumber this Lease or any interest under this Lease; nor sublet or grant concessions of or to the Leased
Premises, in whole or in part; nor allow any person (other than Tenant, its employees, agents, servants, and
invitees) to occupy or use all or part of the Leased Premises. Landlord's consent may be withheld for any or
no reason. Regardless of any such consent, no assignment or subletting shall release Tenant of its
obligations or after the primary liability of Tenant to pay rent and perform all its other obligations under this
Lease. Landlord's consent to one assignment, subletting, occupation, or use by any other person shall not
be deemed a consent to any subsequent assignment, subletting, occupation, or use by another person. The
transfer of fifty percent ((5550%) or more of Tenant's stock, it Tenant is a corporation, or the transfer of fifty
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percent (50%) or more of a partnership interest in Tenant, if Tenant is a partnership, shall constitute ?n
assignment under the terms of this Lease.
2 611 t all
Notwithstanding the above, Tenant shall have the right to sublet the portion of the Leased Premises
currently used for Tenant's business, provided however, that any subtenant shall be subject to Landlord's
approval, which approval shall not be unreasonably withheld, and further provided that if the rental rate per
square foot of the sublet portion of the Leased Premises exceeds the rental rate per square foot of this
Lease, then Tenant shall pay to Landlord each month, together with the rent due under this Lease, an
amount equal to one half (112) of the amount by which the rent due under the sublease exceeds the rent
which would be due for the sublet space under the terms of this Lease, computed on a per square foot basis.
17, rnndemnatinn. If the whole or any part of the Leased Premises shall be taken by power of
eminent domain or condemned by any competent authority for any public or quasi-public use or purpose, or if
any adjacent property or street shall be so taken or condemned, or reconfigured or vacated by such authority
in such manner as to require the use, reconstruction, or remodeling of any part of the Leased Premises, or if
Landlord shall grant a deed or other instrument in lieu of such taking by eminent domain or condemnation,
Landlord (and if more than ten percent (10%) of the rentable area of the Leased Premises is taken, or if
access to the Leased Premises or any common restrooms serving the same is materially impaired) Tenant
shall have the option to terminate this Lease upon ninety (90) days notice, provided such notice is given no
later than one hundred eighty (1110) days after the date of such taking, condemnation, configuration, vacation,
deed, or other instrument. Landlord shall be entitled to receive the entire award or payment in connection
therewith, and Tenant waives any right it may have to any such award or payment. All rent shall be
apportioned as of the date of such termination or the date of such taking, whichever shall first occur. If any
part of the Leased Premises shall be taken, and this Lease shall not be so terminated, the rent shalt be
proportionately abated.
18. Damage hV Fire arfather Casualty. If the Leased Premises or a substantial portion of the
Building is damaged by fire or other casualty during the Term, Landlord may, at its sole option, either (I)
restore the Leased Premises with reasonable dispatch to substantially the same condition they were in prior
to such damage, insofar as the proceeds from Landlord's insurance permit, or (ii) terminate this Lease. If
Landlord elects to restore the Leased Premises, Landlord shall have no liability to restore any improvements
as may have been made to the Leased Premises, whether before or after the date of this Lease, nor to
restore any of Tenant's fixtures, decorations, equipment, furniture, or inventory. Landlord's sole
responsibility, if any, shall be to deliver to Tenant a shell space with roof, floor, exterior walls, windows, and
doors. If the Leased Premises are rendered untenable in whole or in part as a result of such damage and
this Lease is not terminated, the Minimum Rent and Additional Rent payable shall be equitably and
proportionately abated (according to loss of use) during the period intervening between the date of such
damage and the date the Leased Premises are restored. If Landlord elects to terminate this Lease, all rent
payable shall be abated as of the date of such damage and Tenant shall remove all of its property from the
Leased Premises within thirty (30) days after the notice of termination is given, provided Tenant is not in
default at the time.
19. landlord's Ineitrance. Landlord shall maintain during the Term such commercial public
liability insurance for the Common Areas as Landlord deems appropriate, and shall also maintain during the
Term primary, non-contributory insurance on the Building against fire, and extended coverage or "all-risk"
insurance, in an amount equal to the full insurable replacement value of the Building (excluding costs of
excavation, foundations and footings, and such risks required to be covered by Tenant's insurance), or such
other amount necessary to prevent Landlord from being a co-Insured (collectively, the "Insurance"). Tenant
shall pay as Additional Rent in equal monthly installments, in advance, without prior demand or offset of any
kind, its prorata share of the cost of the Insurance. Tenant's prorata share of the Insurance is stated in
Section 1, subsection (0, of this lease. Tenant's prorata portion of the Insurance may be reviewed, adjusted
and billed in the same manner as set forth in Section 5, subsection (c) above.
20. Tpnant'c Ind trance.
(a) Tenant shall, at all times during the Term and at its own cost and expense, carry', (i)
commercial general liability insurance on the Leased Premises (including Common Areas adjoining the
Leased Premises) with limits of not less than $1,000,000.00 for injury or death to one person, $2,000,000.00
for injury or death to more than one person, and $500,000.00 for property damage; (ii) "all-risk" casualty
insurance, written at replacement cost value and with replacement cost endorsement, covering all Tenant's
personal property in the Leased Premises (including, without limitation, inventory, trade fixtures, floor
coverings, furniture, and other property removable by Tenant under the provisions of this Lease) and all
Leasehold improvements installed in the Leased Premises by or on behalf of Tenant; (iii) plate glass
insurance; and (iv) if and to the extent required by Law, workmen's compensation or similar insurance.
(b) All such insurance policies shall name Landlord as a named insured and shall be written by
companies acceptable to Landlord and in form acceptable to Landlord. Each such policy shall also contain a
provision prohibiting cancellation without thirty (30) days' prior written ;n, to Landlord or its designee,
i
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Certificates of such insurance policies shall be delivered to Landlord promptly after the issuance of the
respective policies and annually thereafter. It Tenant fails to provide or maintain any such insurance,
Landlord may (but shall not be obligated to) do so and collect the cost thereof as Additional Rent.
21, dleMnifir n of ndinrd. Tenant shall indemnity and hold Landlord harmless from liability
for damages to person or property (including Tenant's employees, customers, and other invitees) in or upon
the Leased Premises, including vestibules, entryways, and walkways adjoining the Leased Premises, and the
loading platform area, if any, allocated to the use of Tenant. Tenant shall also indemnity and hold Landlord
harmless from such liability for damage in other parts of the Building if caused by Tenant's negligence,
affirmative act, or breach of its obligations under this Lease. All property kept, stored, or maintained in the
Premises shalt be kept, stored, or maintained at Tenant's sole risk. Tenant waives all claims against and
releases Landlord, and Landlord's employees and agents, from liability for damages or injury suffered by
Tenant or any person claiming through Tenant as a result of any accident or other occurrence in or upon the
Leased Premises or any other part of the Building, unless the damage or injury was caused by Landlord's
gross negligence or willful misconduct.
22. Waivpr of siihrnnafinn, Tenant waives all claims against Landlord for any damage or loss
Tenant may suffer which is covered by an insurance policy carried by Tenant (or which Tenant is required to
carry under this Lease); and any insurance policy carried by Tenant covering the Leased Premises, its
contents, or any part thereof, shall contain an express waiver of any right of subrogation against Landlord by
the issuer of the policy. Landlord waives all claims against Tenant for any damage or loss Tenant may suffer
which is covered by an insurance policy carried by Landlord (or which Tenant is required to carry under this
Lease), and any insurance policy carried by Landlord covering the Leased Premises, its contents, or any part
thereof, shall contain an express waiver of any right of subrogation against Tenant by the issuer of the policy.
23. [,lefal
23.1 "Event of nefault" Defined.
Any one or more of the following events shall constitute an "Event of Default":
(a) The sale of Tenant's interest in the Premises under attachment, execution or similar
legal process, or if Tenant is adjudicated as bankrupt or insolvent under any state bankruptcy or insolvency
law or an order for relief is entered against Tenant under the Federal Bankruptcy Code and such adjudication
or order is not vacated within ten (10) days.
(b) The commencement of a case under any chapter of the Federal Bankruptcy Code
by or against Tenant or any guarantor of Tenant's obligations hereunder, or the filing of a voluntary or
involuntary petition proposing the adjudication of Tenant or any such guarantor as bankrupt or insolvent, or
the reorganization of Tenant or any such guarantor, or an arrangement by Tenant or any such guarantor with
its creditors, unless the petition is filed or case commenced by a party other than Tenant or any such
guarantor and is withdrawn or dismissed within thirty (30) days after the date of its filing.
(c) The admission in writing by Tenant or any such guarantor of its inability to pay its
debts when due;
(d) The appointment of a receiver or trustee for the business or property of Tenant or
any such guarantor, unless such appointment shall be vacated within ten (10) days of its entry.
(e) The making by Tenant or any such guarantor of an assignment for the benefit of its
creditors, or if in any other manner Tenant's interest in this Lease shall pass to another by operation of law.
(0 The failure of Tenant to pay any Minimum Rent, Additional Rent, Percentage Rent
("Rental") or other sum of money when due.
(g) Default by Tenant in the performance or observance of any covenant or agreement
of this Lease (other than a default involving the payment of money), which default is not cured within ten (10)
days after the giving of notice thereof by Landlord, unless such default is of such nature that it cannot be
cured within such ten (10) day period, in which case no Event of Default shall occur so long as Tenant shall
commence the curing of the default within such ten (10) days period and shall thereafter diligently prosecute
the curing of same; provided, however, if Tenant shall default in the performance of any such covenant or
agreement of this Lease two (2) or more times in any twelve (12) month period, then notwithstanding that
each of such defaults shall have been cured by Tenant, any further similar default shall be deemed an Event
of Default without the ability for cure.
(h) The vacation or abandonment of the Premises by Tenant at any time following
delivery of possession of th/e Premises to Tenant.
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7
(i) The occurrence of any other event described as constituting an "Event of Default"
elsewhere in this Lease.
23.2 Remedies.
Upon the occurrence of an Event of Default, Landlord, without notice to Tenant in any instance (except where
expressly provided for below or by applicable law) may do any one or more of the following:
(a) With or without judicial process, enter the Premises and take possession of any and
all goods, inventory, equipment, fixtures and all other personal property of Tenant, which is or may be put into
the Premises during the Term, whether exempt or not from sale under execution or attachment (it being
agreed that said property shall at all times be bound with a lien in favor of Landlord, provided however that
any such lien shall be subordinate to any and all secured creditors of Tenant, and shall be chargeable for all
Rental and for the fulfillment of the other covenants and agreements herein contained), and Landlord may
sell all or any part thereof at public or private sale, subject to the interests of any secured creditor of Tenant.
Tenant agrees that ten (10) days prior written notice of any public or private sale shall constitute reasonable
notice. The proceeds of any such sale shall be applied, first, to the payment of all costs and expenses of
conducting the sale or caring for or storing said property (including reasonable attorneys' fees); second,
toward the payment of any indebtedness, including (without limitation) indebtedness for Rental, which may be
or may become due from Tenant to Landlord; and third, to pay Tenant, on demand, any surplus remaining
after all indebtedness of Tenant to Landlord has been fully paid;
(b) Perform, on behalf and at the expense of Tenant, any obligation of Tenant under
this Lease which Tenant has failed to perform and of which Landlord shall have given Tenant notice, the cost
of which performance by Landlord, together with interest thereon at the Default Rate from the date of such
expenditure, shall be deemed Additional Rental and shall be payable by Tenant to Landlord upon demand.
Notwithstanding the provisions of this clause (b) and regardless of whether an Event of Default shall have
occurred, Landlord may exercise the remedy described in this clause (b) without any notice to Tenant if
Landlord, in its good faith judgment, believes it would be materially injured by failure to take rapid action or if
the unperformed obligation of Tenant constitutes an emergency;
(c) Elect to terminate this Lease and the tenancy created hereby by giving ten (10)
days prior written notice of such election to Tenant, and reenter the Premises, without the necessity of legal
proceedings, and remove Tenant and all other persons and property from the Premises, and may store such
property in a public warehouse or elsewhere at the cost of and for the account of Tenant without resort to
legal process and without Landlord being deemed guilty of trespass or becoming liable for any loss or
damage occasioned thereby; or
(d) Exercise any other legal or equitable right or remedy which it may have.
Any costs and expenses incurred by Landlord (including, without limitation, reasonable attorneys' fees) in
enforcing any of its rights or remedies under this Lease shall be deemed to be Additional Rental and shall be
repaid to Landlord by Tenant upon demand.
23.3 Damages.
If this Lease is terminated by Landlord pursuant to Section 23.2, Tenant nevertheless shall remain liable for
(a) any Rental and damages which may be due or sustained prior to such termination, all reasonable costs,
fees and expenses including, but not limited to, reasonable attorneys' fees, costs and expenses incurred by
Landlord in pursuit of its remedies hereunder, or in renting the Premises to others from time to time (all such
Rental, damages, costs, fees and expenses being referred to herein as "Termination Damages"), and (b)
additional damages (the "Liquidated Damages"), which, at the election of Landlord, shall be either:
(i) an amount equal to the Rental which, but for termination of this Lease, would have
become due during the remainder of the Term, less the amount of Rental, if any, which Landlord shall receive
during such period from others to whom the Premises may be rented (other than any Additional Rental
received by Landlord as a result of any failure of such other person to perform any of its obligations to
Landlord), in which case such Liquidated Damages shall be computed and payable in monthly installments,
in advance, on the first day of each calendar month following termination of the Lease and continuing until the
date on which the Term would have expired but for such termination, and any suit or action brought to collect
any such Liquidated Damages for any month shall not in any manner prejudice the right of Landlord to collect
any Liquidated Damages for any subsequent month by a similar proceeding; or
(ii) an amount equal to the present worth (as of the date of such termination) of Rental
which, but for termination of this Lease, would have become due during the remainder of the Term, less the
fair rental value of the Premises, as determined by an independent real estate appraiser named by Landlord,
in which case such Liquidated Damages shall be payable to Landlord ' cge lump sum on demand and shall
Landlord's Initials: 4 Tenant's Initials: v411 ?? Page
bear interest at the Default Rate until paid. For purposes of this clause (ii), "present worth" shall be computed
by discounting such amount to present worth at a discount rate equal to one percentage point above the
discount rate then in effect at the Federal Reserve Bank nearest to the location of the Building.
If this Lease is terminated pursuant to Section 23.2, Landlord may relet the Premises or any part thereof,
alone or together with other premises, for such term or terms (which may be greater or less than the period
which otherwise would have constituted the balance of the Term) and on such terms and conditions (which
may include concessions or free rent and alterations of the Premises) as Landlord, in its sole discretion, may
determine, but Landlord shall not be liable for, nor shall Tenant's obligations hereunder be diminished by
reason of, any failure by Landlord to relet the Premises or any failure by Landlord to collect any rent due upon
such reletting.
Nothing contained un this Lease shall limit or prejudice the right of Landlord to prove and obtain, in
proceedings for the termination of this Lease by reason of bankruptcy or insolvency, an amount equal to the
maximum allowed by any statute or rule of law in effect at the time when, and governing the proceedings in
which, the damages are to be proved, whether or not the amount be greater, equal to, or less than the
amount of the loss or damages referred to above. The failure or refusal of Landlord to relet the Premises or
any part or parts thereof shall not release or affect Tenant's liability for damages.
23.4 RAmPrJ'Pc in Event o Rankmptry nrQfhP,r Pmrg riinn,
(a) Anything contained herein to the contrary notwithstanding, if termination of this
Lease shall be stayed by order of any court having jurisdiction over any proceeding described in paragraph
(b) of Section 23. 1, or by federal or state statute, then, following the expiration of any such stay, or if Tenant
or Tenant as debtor-in-possession or the trustee appointed in any such proceeding (being collectively
referred to as "Tenant" only for the purposes of this Section 23.4) shall fail to assume Tenant's obligations
under this Lease within the period prescribed therefor by law or within fifteen (15) days after entry of the order
for relief or as may be allowed by the court, or if Tenant shall fail to provide adequate protection of Landlord's
right, title and interest in and to the Premises or adequate assurance of the complete and continuous future
performance of Tenant's obligations under this Lease, Landlord, to the extent permitted by law or by leave of
the court having jurisdiction over such proceeding, shall have the right, at its election, to terminate this Lease
on fifteen (15) days' notice to Tenant and upon the expiration of said fifteen (15) day period this Lease shall
cease and expire as aforesaid and Tenant shall immediately quit and surrender the Premises as aforesaid.
Upon the termination of this Lease as provided above, Landlord, without notice, may re-enter and repossess
the Premises using such force for that purpose as may be necessary without being liable to indictment,
prosecution or damages therefor and may dispossess Tenant by summary proceedings or otherwise.
(b) For the purposes of the preceding paragraph (a), adequate protection of Landlord's
right, title and interest in and to the Premises, and adequate assurance of the complete and continuous future
performance of Tenant's obligations under this Lease, shall include, without limitation, the following
requirements:
(i) that Tenant comply with all of its obligations under this Lease;
(ii) that Tenant pay to Landlord, on the first day of each month occurring
subsequent to the entry of such order, or the effective date of such stay, a sum equal to the amount by which
the Premises diminished in value during the immediately preceding monthly period, but, in no event, an
amount which is less than the aggregate Rental payable for such monthly period;
(iii) that Tenant continue to use the Premises in the manner originally required
by this Lease;
(iv) that Landlord be permitted to supervise the performance of Tenant's
obligations under this Lease;
(v) that Tenant pay to Landlord within fifteen (15) days after entry of such order
or the effective date of such stay, as partial adequate protection against future diminution in value of the
Premises and adequate assurance of the complete and continuous future performance of Tenant's
obligations under this Lease, an additional security deposit in an amount acceptable to Landlord;
(VI) that Tenant has and will continue to have unencumbered assets after the
payment of all secured obligations and administrative expenses to assure Landlord that sufficient funds will
be available to fulfill the obligations of Tenant under this Lease;
(vii) that if Tenant assumes this Lease and proposes to assign the same
(pursuant to Title 11 U.S.C § 365, or as the same may be amended) to any person who shall have made a
bona fide offer to accept an assignment of this Lease on terms acceptable to such court having competent
jurisdiction over Tenant's estate, then notice of such proposed assignment, setting forth (x) the name and
i
Landlord's Initials: Tenant's Initials: u? Page
0
address of such person, (y) all of the terms and conditions of such offer, and (z) the adequate assurance to
be provided Landlord to assure such person's future performance under this Lease, including, without
limitation, the assurances referred to in Title 11 U.S.C. § 365(b)(3), as it may be amended, shall be given to
Landlord by Tenant no later than fifteen (15) days after receipt by Tenant of such offer, but in any event no
later than thirty (30) days prior to the date that Tenant shall make application to such court for authority and
approval to enter into such assignment and assumption, and Landlord shall thereupon have the prior right
and option, to be exercised by notice to Tenant given at any time prior to the effective date of such proposed
assignment, to accept, or to cause Landlord's designee to accept, an assignment of this Lease upon the
same terms and conditions and for the same consideration, if any, as the bona fide offer made by such
person less any brokerage commissions which may be payable out of the consideration to be paid by such
person for the assignment of this Lease; and
(viii) that if Tenant assumes this Lease and proposes to assign the same, and
Landlord does not exercise its option pursuant to paragraph (vii) of this Section 23.4, Tenant hereby agrees
that:
(A) such assignee shall have a net worth not less than the net worth of
Tenant as of the Commencement Date, or such Tenant's obligations under this Lease shall be
unconditionally guaranteed by a person having a net worth equal to Tenant's net worth as of the
Commencement Date;
(B) such assignee shall not use the Premises except subject to all the
restrictions contained en this Lease;
(C) such assignee shall assume in writing all of the terms, covenants
and conditions of this Lease including, without limitation, all of such terms, covenants and conditions
respecting the Permitted Use and payment of Rental, and such assignee shall provide Landlord with
assurances satisfactory to Landlord that it has the experience in operating stores having the same or
substantially similar uses as the Permitted Use, in first-class shopping centers, sufficient to enable it so to
comply with the terms, covenants and conditions of this Lease and successfully operate the Premises for the
Permitted Use;
(D) such assignee shall indemnify Landlord against, and pay to
Landlord the amount of, any payments which Landlord may be obligated to make to any Mortgagee by virtue
of such assignment;
(E) such assignee shall pay to Landlord an amount equal to the
unamortized portion of any construction allowance made to Tenant; and
(F) if such assignee makes any payment to Tenant, or for Tenant's
account, for the right to assume this Lease (including, without limitation, any lump sum payment, installment
payment or payment in the nature of rent over and above the Rental payable under this Lease), Tenant shall
pay over to Landlord one-half of any such payment, less any amount paid to Landlord pursuant to clause (E)
above on account of any construction allowance.
24. Whived by I andinrrl Landlord's failure to insist upon strict performance by Tenant of any
obligation under this Lease, irrespective of the length of time for which such failure continues, shall not be
construed as a waiver or relinquishment of Landlord's right to demand strict compliance in the future. The
receipt and acceptance by Landlord of rent with knowledge of the breach of any obligation hereof shall not be
deemed a waiver of such breach, and no waiver by Landlord of any provision of this Lease shall be deemed
to have been agreed upon unless expressed in a writing signed by the parties.
25. Liens Tenant shall pay all sums of money due for labor, services, materials, supplies and
equipment furnished at Tenant's request with respect to the Leased Premises or any other part of the
Building. If a mechanic's, materialman's, or other lien (or notice of intent to file such a lien) is filed or recorded
against the Leased Premises, the Building, or Landlord's interest in either, based upon labor, services,
materials, supplies, equipment, or the like ordered, or alleged to have been ordered by Tenant, Tenant shall
cause such lien to be discharged of record within ten (10) days after Tenant first has knowledge of such lien.
if such lien is not discharged within the ten (10) day period, Landlord may (but shall not be obligated to)
cause such discharge by (i) payment to the lienor, (ii) deposit of substitute security with a court having
jurisdiction, (iii) bonding, or (iv) such other means chosen by Landlord; and the entire cost of the discharge
shall be paid to Landlord by Tenant upon demand. Tenant shall, upon request, furnish Landlord with
contractors' affidavits, full and final waivers of right to lien, and receipted bills covering all labor and materials
expended and used in or about the Leased Premises by or at the request of Tenant.
26. Rignc_ Awnngsran? nnnioc. Tenant shall not place or display (or cause to be placed or
displayed) on any exterior door, wait, or window of the Leased Premises any sign, awning, canopy,
advertising matter, or other thing of any kind, and shall not place or display any decoration, lettering, or
Landlord's Initials: ??' Tenant's Initials: Page
advertising matter on the glass of any window or door of the Leased Premises, without Landlord's prior
written approval. Tenant shall maintain such sign, awning, canopy, decoration, lettering, advertising matter,
or other thing, as may be approved by Landlord, in good condition and repair at all times. Specific criteria
regarding signage is set forth in Exhibit B or in the Rules and Regulations, Exhibit C.
27. FYhihirc arfrionda, Ruipg, and R piiatinn?. All Exhibits, Addenda and Rules and
Regulations appended to this Lease are hereby incorporated into this Lease, and Tenant shall comply with
and observe the same. Tenant's failure to comply with and observe the same shall constitute a breach of this
Lease. Landlord reserves the right to amend, supplement, or add to such Rules and Regulations from time
to time.
28. Surrendpr of Premises. On expiration or sooner termination of the Term, Tenant shall
surrender to Landlord the Leased Premises and all Tenant's improvements and alterations, broom clean, in
good order, condition, and repair, except for ordinary wear and tear or condemnation or destruction of the
Leased Premises, and except for trade fixtures that Tenant has removed. Tenant shall also deliver to
Landlord all keys to the Leased Premises and the combination to any safe, remove all its personal property,
and make all repairs and reimbursements required pursuant to this Lease; provided, however, Tenant may
not remove its personal property from the Leased Premises without Landlord's prior written consent, if Tenant
is in breach or default hereunder.
Landlord may elect to retain or dispose of in any manner any alterations or Tenant's personal
property that Tenant does not remove from the premises on expiration or termination of the Term. Title to
any such alterations or Tenant's personal property that Landlord elects to retain or dispose of after expiration
of the Term shall vest in Landlord. Tenant waives all claims against Landlord for any damage to Tenant
resulting from Landlord's retention or disposition of any such alterations or personal property. Tenant shall
be liable to Landlord for Landlord's costs of storing, removing, and disposing of any alterations or Tenant's
personal property which Landlord does not elect to acquire.
29. Hnidnver, Tenant shall indemnify and hold Landlord harmless from and against all costs,
claims, loss, or liability resulting from delay by Tenant in surrendering the Leased Premises, including,
without limitation, any claims made by any succeeding tenant founded on such delay. The parties recognize
and agree that the damage to Landlord resulting from any failure by Tenant to timely surrender possession of
the Leased Premises will be extremely substantial, will exceed the amount of the Minimum Rent payable
under this Lease, and will be impossible to measure accurately. Tenant therefore agrees that if possession
of the Leased Premises is not surrendered to Landlord within twenty-four (24) hours after the date of the
expiration or termination of the Term, then Tenant shall pay, for each month and for each portion of any
month during which Tenant holds over in the Leased Premises after the expiration or termination of the Term,
two times the aggregate of that portion of the Minimum Rent which was payable under this Lease during the
last month of the Term. Nothing contained in this Lease shall be deemed to permit Tenant to retain
possession of the Leased Premises after the expiration of the Term. The provisions of this Section shall
survive the expiration or termination of the Term.
30. Rithnrrfinatinn and Attnrnment. This Lease is and shall be subject and subordinate to any
mortgage, deed of trust, underlying leasehold estate, or other arrangement or right to possession that may
now or hereafter be placed upon or affect the Leased Premises or the land of which the Leased Premises is
a part, or against any building hereafter placed upon the land of which the Leased Premises is a part, to all
advances to be made thereunder, to the interest and principal payable thereon, and to all renewals,
replacements, modifications, consolidations, and extensions thereof. Upon Landlord's request Tenant shall
execute and deliver such documents, in such terms as Landlord reasonably requests, to evidence the same.
Upon request of any such mortgagee, Tenant shall attom to and acknowledge the foreclosure purchaser or
purchasers as Landlord hereunder.
31. Fstnppesertificates, Upon Landlord's request, Tenant shall execute, acknowledge, and
deliver to Landlord a written statement, addressed to such person as Landlord may request, (a) certifying that
this Lease is in full force and effect and unmodified (or if modified, specifying the modifications), and that
Landlord is not in default under this Lease (or if a default is alleged, specifying the default), (b) stating the
date to which rent and any other charges have been paid by Tenant and the address to which notices to
Tenant should be sent, and (c) certifying or stating such other matters as may be required by Landlord. If
Landlord has not received a response within ten (10) days of any such request, such certificate shall be
deemed acceptable to Tenant, whereupon Landlord shall be appointed as Tenant's attomey-in-fact to
execute and deliver such certificate.
32. Fishira Rpfinanrinn If all or part of the Building can be refinanced or further financed only
upon the basis of modifications of this Lease, Tenant shall enter into a written agreement with Landlord
making such Lease modifications as may be required; provided, however, Tenant shall not be required to
make any such modifications relating to the amount of Rent, the use of the Leased Premises, the duration of
the Term, or the improvements, if any, to be made by Landlord to the Leased Premises.
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33. Ruhr of Fntnr, Tenant shall allow Landlord or its representatives to enter the Leased
Premises at any reasonable hour to inspect the same, to make any repairs deemed necessary or desirable,
or to show the premises to prospective tenants, purchasers, or lenders; and six months before the Term
expires, Landlord may place "For Rent" or similar signs in and about the Leased Premises.
34. Farce Maje, im. Whenever Tenant or Landlord is required by the terms of this Lease or by
law to perform any contract, act, work, labor or services, or to discharge any lien against the Leased
Premises, or to perform and comply with any laws, rules, orders, ordinances, or regulations, but is unable to
perform such act(s), then Tenant or Landlord, as appropriate, shall not be deemed to be in default and the
other party shall not enforce or exercise any of its rights under this Lease, if and so long as nonperformance
or default is directly caused by strikes, non-availability of materials, war or national defense preemptions,
governmental restrictions, acts of God, acts of the other party, or other similar causes beyond the reasonable
control of the non-performing party. Tenant and Landlord shall in any event pay any sum of money required
to discharge any lien incurred by them if at any time the Leased Premises, or any part thereof, is in danger of
being foreclosed, forfeited, or lost by reason of such lien.
35. 1 imitafinn of I anr1lnrrJ'e I iahiliw, Except to the extent insurance proceeds are actually
received by Landlord, Landlord shall not be responsible or liable for latent defects, deterioration, or change in
the condition of the Building, the Common Areas, or the Leased Premises, or for any damage resulting
therefrom, whether to person or property, or for loss to any property of Tenant as a result of theft or
misplacement, or for inconvenience, business interruption, or loss of business of Tenant for any reason. To
the extent covered by Tenant's insurance, Tenant shall indemnity and hold Landlord harmless from and
against any and all claims arising out of Tenant's use or occupancy of, or from any other activity permitted or
suffered by Tenant in or about, the Leased Premises, the Building, or shall be fully liable for, and shall
indemnity Landlord against, all such claims. Regardless of any other provision of this Lease, if Landlord, or
its employees, officers, or partners are ordered to pay Tenant a money judgment because of Landlord's
default, then Tenant's sole remedy to satisfy the judgment shall be Landlord's interest in the Building,
including the rental income and proceeds from sate and any insurance proceeds received because of
damage to the Building that are available for use by Landlord. The foregoing shall not be deemed to limit
Tenant's right, it any, to obtain injunctive relief or specific performance.
36. Notice& Any notice, demand, consent, request, or other communication required or
permitted under this Lease shall be in writing and shall be given by hand delivery or sent by the United States
Mail by certified mail, return receipt requested, postage prepaid, and addressed as indicated in Section 1,
subsection (m), Notice shall be deemed given when hand delivered or two (2) days after deposit with the
United States Postal Service. The parties may change their respective addresses by written notice to all
other parties.
37. Quiet F-ni?!?t. Landlord covenants that Tenant, on paying all rents and performing all the
obligations set forth in this Lease, shall have and enjoy quiet and peaceable possession of the Leased
Premises during the Term.
38. EatireEarire Aecment_ This Lease contains the entire agreement between the parties with
respect to the leasing of the Leased Premises and supersedes, merges and replaces all prior written or oral
agreements, negotiations, offers, representations, and warranties with respect to the leasing of the Leased
Premises. This agreement cannot be altered, waived, or modified in any way, including the provisions of this
Section, except in a writing signed by the parties. No course of dealing between the parties, no usage of
trade, and no parol or outside evidence of any nature shall be used to modify, interpret, or supplement any
provision of this Lease.
39. SuryiYal The representations, warranties, and agreements of the parties contained in this
Lease and in all other documents delivered in connection with this Lease shall survive the expiration or
sooner termination of this Lease.
40. Sevrahllit If any provision of this Lease is unenforceable, the remainder of this Lease
shall continue in effect and be construed as if the unenforceable provision had not been contained in this
Lease. Each provision of this Lease shall be valid and enforceable to the fullest extent permitted by law.
41. Rilrressnrs and Aacigns. This Lease shall be binding upon and inure to the benefit of the
parties and their respective heirs, personal representatives, successors, and assigns; provided, however,
that this Section shall not be construed to permit the assignment of this Lease except as expressly provided.
42, Third Ratty Rpnefiriariee, The provisions of this Lease are intended to benefit only the
parties to this Lease. No person not a party to this Lease shall be deemed a third party beneficiary of this
Lease nor shall any such person be authorized or empowered to enforce the provisions of this Lease, except
to the extent such a person becomes a permitted assignee of one of the parties.
Landlord's Initials: Tenant's Initials: Page
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43. Veaue Regardless of what venue would otherwise be permissive or required, the parties
stipulate that all actions arising under or affecting this Lease shall be brought in the Court of Common Pleas
of Cumberland County, Pennsylvania, the parties agreeing that such forum is mutually convenient and bears
a reasonable relationship to this Lease,
44, rnncpnl In li?riediptinn and Af-Mrp. of prnep¢g The parties irrevocably submit to the
jurisdiction of the state courts of the Commonwealth of Pennsylvania and to the jurisdiction of the United
States District Court for the Middle District of Pennsylvania, for the purpose of any suit, action, or other
proceeding arising tinder or affecting this Lease.
45. C4untinnay-s- In computing the number of days for purposes of this Lease, all days shall
be counted, including weekends and holidays; provided, however, that if the last day for taking any action
under this Lease shall fall on a Saturday, Sunday or banking holiday, the time for taking such action shall be
extended to the next regular business day.
46. Niimhpr and r enrtpr When used in this Lease, the singular includes the plural, the plural
includes the singular, and the use of any gender includes any other gender, as circumstances may require.
The term "person" includes both natural persons and entities.
47. Headings. The headings contained in this Lease are for the convenience of the parties only
and are not a part of the substantive agreement of the parties nor shall they affect the meaning or
interpretation of any provision of this Lease in any way.
48. Counterpwlc. This Lease may be executed in multiple counterparts. When at least one (1)
copy of this Lease has been executed by each party to this Lease, this Lease shall be in full force and effect,
and all of such counterparts shall be read together as a single agreement.
49. Recording. Upon request of either Tenant or Landlord, the parties shall execute a short form
of this Lease in a written document witnessed and acknowledged in form capable of being recorded in the
public records, which short form Lease shall be recorded at the sole cost and expense of the party requesting
the same in the Office of the Recorder of Deeds in and for Cumberland County, Pennsylvania, wherein the
Leased Premises are located.
So. Rpimhi ircpmpnt fnr rrpftit aonnrt Tenant shall reimburse Landlord upon Landlord's request
for reasonable amounts Landlord has paid to obtain credit reports on Tenant and all Guarantors of Tenant's
obligations under this Lease.
51. Trial tyf _t_ ,! w Landlord and Tenant each waives any right to trial by jury of any issue(s) in a
summary proceeding or any other suit, action, proceeding or counterclaim at any time brought or instituted by
or against the other with respect to or involving the Leased Premises or any matter arising under or
connected with this Lease and the relationship of Landlord and Tenant created by this Lease.
Landlord's Initials:
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13
IN WITNESS WHEREOF each corporate party hereto has caused this Lease to be executed in its name and
behalf by its duly authorized officer or agent: each individual party hereto has hereunto set his hand, and
each partnership party hereto has caused this Lease to be executed in its name and behalf by the required
number of its General Partners.
Landlord:
By: _&L, Iti .
Title:_ 1.4 A
Date:
Tenant: Z u t
By:
Title: r?y?? ??r /
n ??N
Date: z-
COMMONWEALTH OF PENNSYLVANIA
COUNTY OF (h,, m Q[ p(1j t. to-wit:
The for going_instrument was acknowledged before me this
Chr c-?s i ?Wn r- r?c? lt. or Fe, it.
200-6 by
2?L1Z ?2cf?
Notary Public
My Commission Expires: -/1-??
Wotarinl Saal
Anne Cermopy IJOlary Publk
Msthenkaburg Boro, Cumberland CourMy
My Commlasbn Expiroa Explrea Mar. 11, 20p6
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The following provisions establish the criteria and requirements for Tenant's signage in, upon and
around the Leased Premises and the Building. Included herein are the specifications for design, location,
construction and installation of all Tenant signage and the procedure for effecting same. Notwithstanding
anything contained herein or elsewhere in the Lease, Tenant shall not construct or erect any signage in the
Leased Premises or the Building without the prior written approval of the Landlord, which approval may be
withheld, delayed or denied in Landlord's sole and absolute discretion. Furthermore, notwithstanding
anything in this Exhibit B or the Lease to the contrary, Landlord reserves the right to modify, supplement or
eliminate all or any portion of the provisions of this Exhibit B from time to time during the term without notice
to Tenant, and any revisions to this Exhibit B shall be applicable to any pending or subsequent request by
Tenant for any signage.
Tenant shall be responsible, at Tenant's sole cost and expense, for the design, construction and
installation of any signage approved by Landlord (in its sole discretion.)
2. DFSIrN r'RITFRIA
a) Tenant shall submit design to Landlord for approval.
3, MATFRIAI AN[] C NATRI r:TIQN-
a) Composition and Materials - All such figures shall have closed backs and shall be leak
resistant.
b) Electrical - No flashers, moving signs, panels or other elements will be permitted. Design,
fabrication and installation of all electrical work shall be in strict adherence to all applicable governmental
laws, codes or ordinances.
C) Structural Location and Attachment - All sign structures or elements shall consist of rigid
metal framework with stable interiors to which anchoring bolts, brackets, sleeves or other approved methods
of attachment can be fastened. Structural design, fabrication and installation shall be adequate to withstand
wind and other natural stresses and be sufficient to support the weight of the elements so attached. The sign
and its elements shall have concentric horizontal alignment with Tenant's demised storefront and concentric
vertical alignment with the sign band as specified by Landlord, All letters, numbers, logos, emblems or other
elements shall be individually attached to the building by means of concealed fasteners accomplished so as
to minimize damage to the building and allow for ease of removal; it being understood and agreed that
Tenant shall be responsible for the repair of any damage resulting from the improper installation or removal of
its signage. No raceways shall be permitted. No part of the signage or fasteners shall have corrosive or
stainable materials.
a) Design and Submission - Tenant shall submit two (2) copies of its proposed sign drawings
and specifications to Landlord, and the required number of copies to the governmental authorities having
jurisdiction for approval, if necessary, prior to fabrication and installation. Tenant or its sign contractors shall
secure and pay for all necessary permits and authorizations required by public authorities for the installation
and operation of any Tenant signage. Such drawings and specifications shall clearly indicate all dimensions
and materials to be used including size, copy and color of all letters, numbers, logos and emblems in full
detail. At least one (1) copy of said drawings shall be rendered in colors as close to those proposed to be
used and shall be submitted to Landlord. Landlord thereafter shall respond with any changes required and
Landlord's determination in all signage matters shall be deemed to be conclusive and binding. Any delays or
denials of signage approval shall in no way affect Tenant's obligations under the Lease or any other provision
dealing with Tenant's construction, occupancy or use of the Leased Premises.
b) Contractors - The sign(s) furnished by Tenant shall be fabricated and installed by a licensed
contractor(s) in accordance with the criteria and requirements contained herein and in strict compliance with
all applicable codes, laws, ordinances and/or regulations of any governmental authorities having jurisdiction
thereof. For the purposes of the Lease, signage fabrication and installation shall be deemed an item of
Tenant's Work and all of the requirements imposed upon contractors, subcontractors or agents pursuant to
the provisions of the Lease shall apply hereto.
Landlord's Initials: Tenant's lnltials:?/ Page
(a) OBSTRUCTION DE PASSAGE AYS The sidewalks, passages, courts, corridors, and
other public parts of the Building shall not be obstructed or encumbered by Tenant or used by Tenant for any
purpose other than ingress and egress.
(b) lI1fS Windows in the Leased Premises shall not be covered or obstructed by
Tenant. No bottles, parcels, or other articles shall be placed on the window sills, in the halls, or in any other
part of the Building. No articles shall be thrown out of the doors or windows of the Leased Premises.
(c) PRQJFrTlQNS ERQM RI III LUNG; No awnings, air conditioning units, or other fixtures
shall be attached to the outside walls or the window sills of the Building by Tenant or otherwise affixed by it so
as to project from the Building, without the prior written consent of Landlord.
(d) SIGNS No sign or lettering shall be affixed by Tenant to any part of the outside of the
Building, or any part of the inside of the Leased Premises so as to be clearly visible from the outside of the
Building, without prior written consent of Landlord.
(e) FLOOR COVERING -(OMITTED)
(f) INTERFERENCE 1MTH OQCI (PANTS OF RLULDING Tenant shall not ke, or permit to be
made, any unseemly or disturbing noises and shall not interfere with other tenants or those having business
with them. Tenant will keep all mechanical apparatus in the Leased Premises free of vibration and noise
which may be transmitted beyond the limits of the Leased Premises.
(g) II OCKS KEYS No additional locks or bolts of any kind shall be placed on any of the doors
or windows by Tenant. Tenant shall, on the termination of Tenant's tenancy, deliver to Landlord all keys to
any space within the Building, either furnished to or otherwise procured by Tenant, and in the event of the
loss of any keys furnished, Tenant shall pay Landlord the cost thereof. Tenant, before closing and leaving
the Leased Premises, shall ensure that all its windows are closed and its entrance doors locked.
(h) GQNTRAC:TnRS Landlord shall not be responsible to Tenant for any loss of property from
the Leased Premises however occurring, or for any damage done to the effects of Tenant by janitors or any
of Tenant's employees, or by any other person or any other cause.
(i) PRQHIRITFp nN I FASFD PRFMISFS Tenant shall not, without the prior written approval
of Landlord, (i) conduct, or permit any other person to conduct, any auction upon the Leased Premises, (ii)
permit the Leased Premises to be used for gambling or any other illegal activity, (iii) make any unusual noises
in the Building, (iv) permit to be played any musical instrument on the Leased Premises, (v) permit to be
played any radio, television, recorded or wired music in such a loud manner as to disturb or annoy other
tenants, or (vi) permit any unusual odors to be produced upon the Leased Premises. Canvassing, soliciting
and peddling in the Building are prohibited, and Tenant shall cooperate to prevent the same. No bicycles,
vehicles or animals of any kind shall be brought into or kept in or about the Leased Premises or the Building,
except that vehicles may be parked in the parking spaces provided in the Common Areas and in accordance
with such other rules with respect to vehicles and parking as may be established from time to time by
Landlord.
0) PI IIMRINC; FI FC'TRIG AND TFLFP_ HDNE WORK Plumbing facilities shall not be used
for any purpose other than those for which they were constructed; and no sweepings, rubbish, ashes,
newspaper or other substances of any kind shall be thrown into them. Waste and excessive or unusual
usage of electricity or water is prohibited. When electric wiring of any kind is introduced, it must be
connected as directed by Landlord, and no stringing or cutting of wires will be allowed, except by prior written
consent of Landlord, and shall be done by contractors approved by Landlord.
(k) SAFES AND OTHER HEAVY FQI IIPMFNT Landlord reserves the right to prescribe the
weight and position of all safes and other heavy equipment so as to distribute properly the weight thereof and
to prevent any unsafe condition from arising.
(1) NOTIr E OF ACCADENTS Tenant shall give Landlord prompt written notice of any accident
or damage occurring on or to the Leased Premises or the Common Areas adjacent to the Leased Premises.
Landlord's Initials: Tenant's Initials: Page
EXHIBI D
B1 111 13-011 IT RIDER
WORK-AGREEMENT
THIS AGREEMENT made as of the day of 2005, between
_ ("Landlord") and
a
('Tenant"). The parties hereby acknowledge that they have heretofore entered, or are contemporaneously
herewith entering, a certain Lease agreement dated , 2005 (the "Lease") for
premises (the "Leased Premises") known as located in the property known as
(the "Property").
1 Tho Wnrk Under the Lease, Tenant has agreed to accept the Leased Premises "as is",
without any obligations for the performance of improvements or other work by Landlord, and tenant desires
to perform certain improvements thereto (the "Work"). Such Work shall be in accordance with the provisions
of this Work Agreement, and to the extent not expressly inconsistent herewith, in accordance with the
provisions of the Lease. Performance of the Work shall not serve to abate or extend the time for the
commencement of Rent under the Lease, except to the extent Landlord delays approvals beyond the times
permitted below.
2 C osf of tha Wnrk Except as provided hereinafter, Tenant shall pay all costs (the "Costs of
the Work") associated with the Work whatsoever, including without limitation, all permits, inspection fees, fees
of space planners, architects, engineers, and contractors, utility connections, the cost of all labor and
materials, bonds, insurance, and any structural or mechanical work, all HVAC equipment or sprinkler heads,
or modifications to any building mechanical, electrical, plumbing or other systems and equipment or
relocation of any existing sprinkler heads, either within or outside the Leased Premises required as a result of
the layout, design or construction of the Work.
of the Costs of the Work, Landlord shall reimburse Tenant the amount of $ (the
,,Improvement Allowance"). The Improvement Allowance shall be funded by Landlord within thirty (30) days
after the Work has been completed in accordance with the "Space Plan" and "Working Drawings" approved
by Landlord in writing in accordance with the provisions hereof, and Tenant has submitted all invoices, lien
waivers, affidavits of payment, and such other evidence as Landlord may reasonably require that the cost of
the Work has been paid for and that no mechanic's, materialmen's, or other such liens have been or may be
filed against the Property or the Leased Premises arising out of the design or performance of the Work. In
the alternative, at Landlord's sole option, Landlord may elect to fund the Improvement Allowance in
installments, not more frequently than monthly, based on applications for payment and releases of lien rights,
submitted by Tenant on Landlord's standard form for use by contractors requesting progress payments,
together with such lien releases and affidavits of payments by Tenant's general contractor and
subcontractors contemplated therein, and such other documentation as Landlord may reasonably require.
Landlord may issue checks to fund the Improvement Allowance jointly to Tenant, its general contractor, and,
at Landlord's option, to any subcontractors or suppliers.
a. No later than ten (10) days after the date of this Work Agreement set forth above,
Tenant shall submit two (2) sets of a "Space Plan" (as described in Section 16 below) to Landlord for
approval.
b. Landlord shall, within ten (10) days after receipt thereof, either approve said Space
Plan, or disapprove the same advising Tenant of the reasons for such disapproval, In the event Landlord
disapproves said Space Plan, Tenant shall modify the same, taking into account the reasons given by
Landlord for said disapproval, and shall submit two (2) sets of the revised Space Plan to Landlord within five
(5) days after receipt of Landlord's initial disapproval.
4. }( bddag-Drawinas and Fnainpprina Report,
a. No later than twenty (20) days after receipt of Landlord's approval of the Space
Plan, Tenant shall submit to Landlord for approval two (2) sets of "Working Drawings" (as defined in Section
16 below), and a report (the "Engineering Report") from Tenant's mechanical, structural and electrical
engineers indicating any special heating, cooling, ventilation, electrical, heavy load or other special or unusual
requirements of Tenant.
b. Landlord shall, within ten (10) working days after receipt thereof, either approve the
Working Drawings and Engineering Report, or disapprove the same advising Tenant of the reasons for
disapproval. If Land/lord isapproves of the Working Drawings or Engineering Report, Tenant shall modify
Landlord's Initials: V, Tenant's Initials: 6;:? Page
and submit revised Working Drawings, and a revised Engineering Report, taking into account the reasons
given by Landlord for disapproval, within five (5) days after receipt of Landlord's initial disapproval.
5. 1 andinrdfs Annrnvai Landlord shall not unreasonably withhold approval of any Space
Plans, Working Drawings, or Engineering Report submitted hereunder if they provide for a customary
with finishes and materials generally conforming to building standard finishes and
materials currently being used by Landlord at the Property, are compatible with the Property's exterior
construction, and if no modifications will be required for the Property's electrical, heating, air conditioning,
ventilation, plumbing, fire protection, life safety, or other systems or equipment, and will not require any
structural modifications to the Property whether required by heavy loads or otherwise.
6. are Plannprs ArrhitprlS FnginpeLS and nntrnrtnrs The Space Plan, Working
Drawings, Engineering Report and the Work, shall be prepared and performed by such space planners,
architects, engineers and contractors as Landlord customarily engages or recommends for use at the
property; provided, Tenant may substitute another licensed, bonded, reputable and qualified space planner,
architect, engineer or contractor, who will work in harmony with each other and those of Landlord so as to
ensure proper maintenance of good labor relationships. Such substitutions may be made only with
Landlord's prior written approval. Such approval shall be granted or denied within ten (10) days after
Landlord receives from Tenant a written request for such substitution, containing a reasonable designation of
the proposed party's background, references and qualifications. Any such substitution shalt not serve to
delay the times for submission of the Space Plan, Working Drawings and Engineering Report required
herein, except to the extent that Landlord delays granting or denying approval beyond the aforementioned
ten (10) day period.
7. r,hang rders• No changes, modifications, alterations or additions to the approved Space
Plan or Working Drawings may be made without the prior written consent of the Landlord after written request
therefor by Tenant. In the event that the Leased Premises are not constructed in accordance with said
approved Space Plan and Working Drawings, then Tenant shall not be permitted to occupy the Leased
Premises until the Leased Premises reasonably comply in all aspects with said approved Space Plan and
Working Drawings; in such case, the Rent shall nevertheless commence to accrue and be payable as
otherwise provided in the Lease.
8. Cnn+ni` tancc .. Tenant's Work shall comply in all respects with the following: (a) the Building
Code of the City and State in which the Building is located and State, County, City or other laws, codes,
ordinances and regulations, as each may apply according to the rulings of the controlling public official, agent
or other such persons, (b) applicable standards of the National Board of Fire Underwriters and National
Electrical Code, and (c) building material manufacturer's specifications.
g. Guarantees: Each contractor, subcontractor and supplier participating in Tenant's Work
shall guarantee that the portion thereof for which he is responsible shall be free from any defects in
workmanship and materials for a period of not less than one (1) year from the date of completion thereof.
Every such contractor, subcontractor, and supplier shall be responsible for the replacement or repair, without
additional charge, of all work done or furnished in accordance with its contract which shall become defective
within one (1) year after completion thereof. The correction of such work shall include, without additional
charge, all additional expenses and damages in connection with such removal or replacement of all or any
part of Tenant's Work, and/or the Property and/or Common Areas, or work which may be damaged or
disturbed thereby. All such warranties or guarantees as to materials or workmanship of or with respect to
Tenant's Work shall be contained in the contract or subcontract which shall be written such that said
warranties or guarantees shall inure to the benefit of both Landlord and Tenant, as their respective interests
may appear, and can be directly enforced by either. Tenant covenants to give Landlord any assignment or
other assurances necessary to effect such right of direct enforcement. Copies of all contracts and
subcontracts shall be furnished to Landlord promptly after the same are entered.
10. Pprformanm
a. Tenant's Work shall be commenced within fifteen (15) days after Landlord approves
the Working Drawings, and shall thereafter be diligently prosecuted to completion, subject to delays for
reasons beyond Tenant's control (except financial matters). All Work shall conform with the Working
Drawings approved by Landlord in writing, and Landlord may periodically inspect the Work for such
compliance. Tenant's Work shall be coordinated under Landlord's direction with the work being done or to be
performed for or by other tenants in the Property so that Tenant's Work will not interfere with or delay the
completion of any other construction work in the Property.
b. Tenant's Work shall be performed in a thoroughly safe, first-class and workmanlike
manner in conformity with the approved Space Plan and Working Drawings, and shall be in good and usable
condition at the date of completion.
Landlord's Initials: Z6 Tenant's Initials f -" Page
C. Tenant shall be required to obtain and pay for all necessary permits and/or fees with
respect to Tenant's Work, and the same shall be shown to Landlord prior to commencement of the Work.
d. Each contractor and subcontractor shall be required to obtain prior written approval
from Landlord for any space outside the Leased Premises within the Property, which such contractor or
subcontractor desires to use for storage, handling, and moving of his materials and equipment, as well as for
the location of any facilities for his personnel.
e. The contractors and subcontractors shall be required to remove from the Leased
Premises and dispose of, at least once a week and more frequently as Landlord may direct, all debris and
rubbish caused by or resulting from the construction. Upon completion of Tenant's Work, the contractors and
subcontractors shall remove all surplus materials, debris and rubbish of whatever kind remaining within the
Property which has been brought in or created by the contractors and subcontractors in the performance of
Tenant's Work. If any contractor or subcontractor shall neglect, refuse or fail to remove any such debris,
rubbish, surplus material or temporary structures within two (2) days after notice to Tenant from Landlord with
respect thereto, Landlord may cause the same to be removed by contract or otherwise as Landlord may
determine expedient, and charge the cost thereof to Tenant as Additional Rent under the Lease.
f. Tenant shall obtain and furnish Landlord all approvals with respect to electrical,
water and telephone work as may be required by the respective company supplying the service. Tenant
shall obtain utility service, including meter from the utility company supplying service, unless Landlord elects
to supply service and/or meters.
g. Landlord shall have the right to require Tenant to furnish bonds or other security in
form and amount reasonably satisfactory to Landlord for the prompt and faithful performance and payment
for Tenant's Work.
h. Landlord's acceptance of Tenant's Work as being complete in accordance with the
approved Space Plan and Working Drawings shall be subject to Landlord's inspection and written approval.
Tenant shall give Landlord five (5) days prior written notification of the anticipated completion date of Tenant's
Work.
i. If contemplated or permitted under the statutes of the Stale in which the Property is
located, within ten (10) days after completion of construction of Tenant's Work, Tenant shall execute and file
a Notice of Completion with respect thereto.
j. Tenant shall, at its cost and expense construct, purchase, install and perform any
and all items of Tenant's Work, stock its merchandise, and employ its personnel so as to obtain any
governmentally required certificate of occupancy and to occupy the Leased Premises as soon as possible,
and in all cases on or before the date required therefor hereunder or under the Lease.
k. If an expansion joint occurs within the Leased Premises, Tenant shall install finish
floor covering to or covering such joint in a workmanlike manner, and Landlord shall not accept responsibility
for any finish floor covering applied to or installed over the expansion joint.
L Copies of "as built' drawings shall be provided to Landlord no later than thirty (3o)
days after completion of the Work.
M Landlord's approval of Tenant's plans and specifications, and Landlord's
recommendations or approvals concerning contractors, subcontractors, space planners, engineers or
architects, shall not be deemed a warranty as to the quality or adequacy of the Work, or the design thereof,
or of its compliance with laws, codes and other legal requirements.
n. Tenant shall conduct its labor relations with employees so as to avoid strikes,
picketing, and boycotts of, on or about the Leased Premises or Property. If any employees strike, or if picket
lines or boycotts or other visible activities objectionable to Landlord are established, conducted or carried out
against Tenant, its employees, agents, contractors, subcontractors or suppliers, in or about the Leased
Premises or Property, Tenant shall immediately close the Leased Premises and remove or cause to be
removed all such employees, agents, contractors, subcontractors and suppliers, in or about the Leased
Premises or Property, Tenant shall immediately close the Leased Premises and remove or cause to be
removed all such employees, agents, contractors, subcontractors and suppliers until the dispute has been
settled.
o. Landlord shall not be responsible for any disturbance or deficiency created in the air
conditioning or other mechanical, electrical or structural facilities within the Property or Leased Premises as a
result of the Work. If such disturbances or deficiencies result, Tenant shall correct the same and restore the
services to Landlord's reasonable satisfaction, within a reasonable time.
Landlord's Initiats: ?? Tenant's Initials: J' Page
P. If performance of the Work shall require that additional services or facilities be
provided, Tenant shall pay Landlord's reasonable charges therefor.
q. Tenant's contractors shall comply with the rules of the Property and Landlord's
requirements respecting the manner of handling materials, equipment and debris. Demolition must be
performed at such times as Landlord determines in its sole judgment as least disruptive to the Building
tenants. Delivery of materials, equipment and removal of debris must be arranged to avoid any
inconvenience or annoyance to other tenants. The Work and all cleaning in the Leased Premises must be
controlled to prevent dirt, dust or other matter from infiltrating into adjacent tenant or mechanical areas or the
parking lots.
F. Landlord may impose reasonable additional requirements from time to time in order
to ensure that the Work, and the construction thereof does not disturb or interfere with any other tenants of
the Property, or their visitors, contractors or agents, nor interfere with the efficient, safe and secure operation
of the Property.
11. Ins franc All contractors and subcontractors shall carry Worker's Compensation Insurance
covering all of their respective employees in the statutory amounts, Employer's Liability Insurance in the
amount of at least $500,000 per occurrence, and comprehensive general liability insurance of at least
$3,000,000 combined single limit for bodily injury, death, or property damage; and the policies therefor shall
cover Landlord, Tenant, as additional insureds, as well as the contractor or subcontractor. Tenant shall carry
builder's risk insurance coverage respecting the construction and improvements to be made by Tenant, in the
amount of the anticipated cost of construction of the Work (or any guaranteed maximum price). All insurance
carriers hereunder shall be rated at least A and X in Best's Insurance Guide. Certificates for all such
insurance shall be delivered to Landlord before the construction is commenced or contractor's equipment is
moved onto the Property. All policies of insurance must require that the carrier give Landlord twenty (20)
day's advance written notice of any cancellation or reduction in the amounts of insurance. In the event that
during the course of Tenant's Work any damage shall occur to the construction and improvements being
made by Tenant, then Tenant shall repair the same at Tenant's cost.
12. Since The content of all signage shall be subject to Landlord's prior written approval. No
other signage may be installed or placed outside the Leased Premises by Tenant unless installed in
accordance with the Landlord's signage criteria.
13. A%h %tn¢ If the Property was constructed at a time when asbestos was commonly used in
construction, Tenant acknowledges that asbestos-containing materials ("ACM") may be present at the
Property, and that airborne asbestos fibers may involve a potential health hazard unless proper procedures
are followed. In such case, before commencing the Work, Tenant and its contractor shall consult with
Landlord and Landlord's asbestos consultant concerning appropriate procedures to be followed. Landlord
shall, at Tenant's expense, undertake any necessary initial asbestos-related work, before Tenant
commences the work. During performance of the Work. Tenant shall require that its contractor comply with
all laws, rules, regulations and other governmental requirements, as well as all directives of Landlord's
asbestos consultant, respecting ACM. Tenant hereby irrevocably appoints Landlord and Landlord's asbestos
consultant as Tenant's attomeyAn_fart for purposes of supervising and directing any asbestos-related
aspects of the Work (but such appointment shall not relieve Tenant from its obligations hereunder, nor
impose any affirmative requirement on Landlord to provide such supervision or direction).
14. Liens; Tenant shall keep the Property and the Leased Premises free from any mechanic's,
materialman's or similar liens or other such encumbrances in connection with the Work, and shall indemnity
and hold Landlord harmless from and against any claims, liabilities, judgments, or costs (including attorneys'
fees) arising in connection therewith. Tenant shall give Landlord notice at least twenty (20) days prior to the
commencement of the Work (or such additional time as may be necessary under applicable laws), to afford
Landlord the opportunity of posting and recording appropriate notices of non-responsibility. Tenant shall
remove any such lien or encumbrance by bond or otherwise within thirty (30) days after written notice by
Landlord, and if Tenant shall fail to do so, Landlord may pay the amount necessary to remove such lien or
encumbrance, without being responsible for investigating the validity thereof. The amount paid shall be
deemed Additional Rent under the Lease payable upon demand, without limitation as to other remedies
available to Landlord under the Lease. Nothing contained herein shall authorize Tenant to do any act which
shall subject Landlord's title to the Property or Leased Premises to any liens or encumbrances whether
claimed by operation of law or express or implied contract. Any claim to a lien or encumbrance upon the
property or Leased Premises arising in connection with the Work shall be null and void, or at Landlord's
option shall attach only against Tenant's interest in the Leased Premises and shall in all respects be
subordinate to Landlord's title to the Property and Leased Premises.
15. lodemnlty Tenant shall indemnify, defend and hold harmless Landlord (band Landlord's
principals, partners, agents, trustees, beneficiaries, officers, employees and affiliates) from and against any
claims, demands, losses, damages, injuries, liabilities, expenses, judgments, liens, encumbrances, orders
and awards, together with attorneys' fees and litigation exp s arising out of or in connection with the
Landlord's Initials: Tenant's Initials Page
4
Work, or Tenant's failure to comply with the provisions hereof, or any failure by Tenant's contractors,
subcontractors or their employees to comply with the provisions hereof, except to the extent caused by
Landlord's intentional or negligent acts.
16. r .chin nPfinifinn-
a. "Space Plan" herein means a layout plan, drawn to scale, showing (1) demising
walls, interior partition walls and interior doors, including any special walls, glass partitions or special features,
(2) any restrooms, kitchens, computer rooms, and other special purpose rooms, and any sinks or other
plumbing facilities, or other special facilities or equipment, (3) any communications system, indicating
telephone and computer outlet locations, and (4) any other details or features required to reasonably
delineate the Work to be performed.
b. "Working Drawings" herein means fully dimensioned architectural construction
drawings and specifications, and any required engineering drawings (including mechanical, electrical,
plumbing, air-conditioning, ventilation and heating) and shall include any applicable items described above for
the Space Plan, and if applicable: (1) electrical outlet locations, circuits and anticipated usage therefor, (2)
reflected ceiling plan, including lighting, switching, and any special ceiling specifications, (3) duct locations for
heating, ventilating and air-conditioning equipment, (4) details of all millwork, (5) dimensions of all equipment
and cabinets to be built in (6) furniture plan showing details for space occupancy, (7) keying schedule, (8)
lighting arrangement, (9) location of any major equipment or systems (with brand names wherever possible)
which require special consideration relative to air-conditioning, ventilation, electrical, plumbing, structural, fire
protection, life-fire-safety system, or mechanical systems, (10) special heating, ventilating and air conditioning
equipment and requirements, (11) weight and location of heavy equipment, and anticipated loads for special
usage rooms, (12) demolition plan, (13) partition construction plan, (14) type and color of floor and wail-
coverings, wall paint and any other finishes, and any other details or features required to completely delineate
the Work to be performed and (15) a site plan, if applicable, including landscaping, and exterior signage.
17. Taxes. Tenant shall pay prior to delinquency all taxes, charges or other governmental
impositions (including without limitation, any real estate taxes or assessments, sales tax or value added tax)
assessed against or levied upon Tenant's fixtures, furnishings, equipment and personal property located in
the Leased Premises and the Work to the Leased Premises under this Agreement. Whenever possible,
Tenant shall cause all such items to be assessed and billed separately from the property of Landlord. In the
event any such items shall be assessed and billed with the property of Landlord, Tenant shall pay its share of
such taxes, charges or other governmental impositions to Landlord within thirty (30) days after Landlord
delivers a statement and a copy of the assessment or other documentation showing the amount of such
impositions applicable to Tenant.
18. INCORPORATED INTO LEASE; DEFAULT. THE PARTIES AGREE THAT THE
PROVISIONS OF THIS WORK AGREEMENT ARE HEREBY INCORPORATED BY THIS REFERENCE
INTO THE LEASE FULLY AS THOUGH SET FORTH THEREIN. In the event of any express
inconsistencies between the Lease and this Work Agreement, the latter shall govern and control. If Tenant
shall default under this Work Agreement, Landlord may order that all Work being performed in the Leased
Premises be stopped immediately, and that no further deliveries to the Leased Premises be made, until such
default is cured, without, limitation as to Landlord's other remedies. Any amounts payable by Tenant to
Landlord hereunder shall be paid as Additional Rent under the Lease. Any default by the other party
hereunder shall constitute a default under the Lease and shall be subject to the remedies and other
provisions applicable thereto under the Lease. If Tenant shall default under the Lease or this Work
Agreement and fail to cure the same within the time permitted for cure under the Lease, at Landlord's option,
all amounts paid or incurred by Landlord towards the Improvement Allowance shall become immediately due
and payable as Additional Rent under the Lease.
Landlord's Initials: LANDLORD:
BY Date.
Title:
TENANT: Zr, r L -f d
BY Date:
Title:
Tenant's Initials: Page
EXHIBII E
G1 lARAb=
THIS GUARANTY ("Guaranty") is made this LU day of ,,e 1, . 2006, by and between
Kenneth R. Paton and W. Douglas Waardenburg (Individually "Guarantor"and collectively "Guarantors") and
Alpha Omega Limited, LLC ("Landlord"), with respect to certain present and future obligations of Zur, LTD
("Tenant").
WHEREAS, Tenant wishes to enter into a Building Lease (the "Lease") between Tenant and
Landlord (all obligations of Tenant under the Lease, whether now existing or hereafter incurred, whether
direct, indirect, contingent or fixed, whether incurred as primary obligor, co-maker, endorser, or guarantor,
whether otherwise guaranteed or secured, and whether on open account, evidenced by a written instrument
or otherwise, are collectively referred to as the "Obligations"); and
WHEREAS, Landlord has required additional assurances of Tenant's performance of the Obligations
as a condition of entering into the Lease.
NOW, THEREFORE, in consideration of good and valuable consideration and in order to induce
Landlord to enter into the Lease, the parties agree as follows:
1. Guaranty Each of the Guarantors jointly and severally guarantee to Landlord the prompt
performance when due of the Obligations, including without limitation payment of all sums due under the
Lease, plus any interest, penalties, and collection fees thereon. Each of the Guarantors agrees to make
such payments to Landlord and perform any non-monetary Obligations, if there is any default in the payment
or the performance of the Obligations.
2. Nature of Guaranty: This is a continuing, unconditional Guaranty and the liability of each of
the Guarantors to Landlord is not limited to a proportionate part of the total liability of the Tenant to landlord.
This is a guaranty of payment and not of collection, and each of the Guarantors waives any right to require
that any action be brought against the Tenant, or any other Guarantor, or to require that Landlord proceed
against any security, or any other person, and agrees that Landlord assumes no responsibility for the validity
or enforceability of any security for the Obligations.
3. Subr_ nnat? o As a material inducement for Landlord to accept this Guaranty and enter into
the Lease, the Guarantors represent and warrant that they have no right of indemnification from or against
Tenant, any such right being waived. In lieu of any other remedy the Guarantors may have against Tenant,
the Guarantors shall be subrogated to the rights of Landlord against Tenant; provided that none of the
Guarantors shall be subrogated to, or may enforce on the part or behalf of any of the Guarantors, any right of
action which Landlord may have against the Tenant until the Obligations shall have been paid in full.
4. rnnditinng PrAeedpnt Each of the Guarantors represents and warrants that his liability
under this Guaranty is not contingent or conditional upon any other person signing this Guaranty or the
obtaining or perfecting of any security for the Obligations, or any other condition precedent or subsequent.
5, angE,c Affe-rting the- nNigatinns Landlord may, from time to time, either before or after
the death of any of the Guarantors, or any default by the Tenant, with or without further notice to any of the
Guarantors, renew or extend the time of payment of the Obligations, and grant and allow such indulgences,
modifications, or compromises in connection therewith as it deems advisable or expedient, and may change,
renew, extend, surrender, impair, or compromise, in whole or in part, any security at any time held by or
available to Landlord for the Obligations or for any obligation of any other person secondarily or otherwise
liable on the Obligations, intentionally or unintentionally, or may waive, release, extend, or modify the rights of
any of the Guarantors, without impairing the enforceability of this Guaranty. The death, disability, or
discharge in bankruptcy of the Tenant or any of the Guarantors shall not affect the liability of any remaining
Guarantors.
6. rnStc of rnllantion• Each of the Guarantors shall, upon demand, pay all costs and
expenses incurred by Landlord in connection with the enforcement or collection of the Obligations or the
enforcement of this Guaranty, including attorneys' fees and disbursements. In determining attorneys' fees,
the parties deem the following to be reasonable: the greater of either (a) twenty-five percent ( 15%) of the
amount due at the time payment is made, including all past due interest, costs, and fees, or (b) $1,500 in fees
if the matter is litigated before- a nkfrirt Justice, or $5,000 in fees if the matter is litigated in the Cnud.nf
rnmmnn Plea a, plus all actual costs and disbursements.
7. Rpinatatpme-nt of Guaranty- Even if the Obligations may have been paid in full and this
Guaranty may have been returned to the Guarantors, this Guaranty shall continue in full force and effect with
Landlord's Initials:k Tenant's Initials:J??\> Page
respect to any amounts that Landlord may ever be required to repay under any bankruptcy or insolvency
laws.
6. Waivers of I-InfneGle ri entire Each of the Guarantors hereby waives the benefit of any
homestead exemption and notice of acceptance of and demand for payment as to this Guaranty and also
waives notice of any default in the Obligations or of action taken in connection therewith. To the extent any
notice may not be legally waived, each Guarantor appoints the Tenant his or her attorney-in-fact for the
delivery of any notice, and any notice delivered to the Tenant shall be deemed received by each of the
Guarantors.
9, Delap Waivers h?L I anrllorrl No delay on the part of Landlord in exercising any rights
hereunder or under the Lease or any failure to exercise the same shall operate as a wavier of such rights; no
notice to or demand on the Guarantors shall be deemed to be a waiver of the obligations of the Guarantors or
of the right of Landlord to take further action without notice or demand as provided herein.
10. Madifiratinn Waiver of this u^rnh
--r?--.?l- No modification or waiver of the provisions of this
Guaranty, including the provisions of this paragraph, shall be effective unless in writing and signed by
Landlord; nor shall any waiver be applicable except in the specific instance for which it is given.
11. Snurnpc of Infnrmatinn The Guarantors warrant that they have adequate means to obtain
from the Tenant, now and on a continuing basis, all necessary and desirable information concerning the
status of the Obligations and the financial condition of the Tenant, and they are not relying on the Landlord to
provide such information, either now or in the future.
12. Financial Infnrmatinn Upon Landlord's reasonable requests from time to time, each of the
Guarantors shall provide Landlord with financial information covering such periods and in such form as is
satisfactory to Landlord.
13. MnrlifiCatinns to I ease Landlord may make such modifications and additions to the Lease
and the Obligations as Landlord may deem advisable, including without limitation, extending the term of the
Lease, increasing or decreasing payments under the Lease, or allowing Tenant to assign or delegate its
duties under the Lease, and the same shall not release any Guarantor or in any way limit the liability of any
Guarantor, this Guaranty expressly extending to such modifications and extensions.
14. Notices Any notice or other communication required or permitted by this Guaranty shall be
in writing and shall be deemed given when hand delivered or deposited in the United States mail, postage
prepaid, via first class or certified mail, and addressed to the parties as follows:
If to Landlord: Alpha Omega, LLC
P. O. Box 3555
Camp Hill, PA 17011
With a copy to: Attorney Mark Thomas.
101 South Market Street
Mechanicsburg, PA 17055
If to Guarantor(s): Kenneth R. Paton
6B Round Ridge Road
Mechaniscburg, PA 17055
W. Douglas Waardenburg
2230 Canterbury Drive,
Mechanicsburg, PA 17055
With a copy to: Ralph H. Wright, Jr.
Johnson, Duffie, Stewart & Weidner
P.O. Box 109
Lemoyne, PA 17043-0109
Landlord's Initials: Tenant's Initials:k-Page
15. Ed- A;memeat This Guaranty constitutes the entire agreement between the parties with
respect to the subject matter of this Guaranty and supersedes and merges all prior negotiations, offers,
representations, warranties, and agreements with respect to the subject matter of this Guaranty. No course
of prior dealing between the parties, no usage of trade, and no parol, extrinsic, or other outside evidence of
any nature shall be used to supplement, interpret, or modify any of the terms of this Guaranty.
16. Sevnrahifi . If any provision of this Guaranty
Guaranty shall continue in effect and be construed as if the unenforceable provision hadenot bee ncontained
in this Guaranty. Each provision of this Guaranty shall be valid and enforceable to the fullest extent permitted
by law.
17, Si?rrpccnrc ^nrf Accinnc This Guaranty shall be binding upon and inure to the benefit of
the parties and their respective heirs, personal representatives, successors, and assigns.
18. Venue Regardless of what venue would otherwise be permissive or required, the parties
stipulate that all actions arising under or affecting this Guaranty shall be brought in the Court of rnmamn
PiPac of r ijmhPdanrl C'rnnnt} Ppnn4l nla, the parties agreeing that such forum is mutually convenient and
bears a reasonable relationship to this Guaranty.
19. G?osPn} fn luricrlirtinn ^nr} Ca iro of Pr occ
The parties irrevocably submit to the
jurisdiction of the state courts of the Commonwealth of Pe ncviv^ni^
States District Court for the Miririlo niefrirf of PpnnC I ----,-_--...nd to the jurisdiction of the United
proceeding arising under or affecting this Guaranty. for the purpose of any suit, action, or other
20. NUmbe an't Gend r. When used in this Guaranty, the singular includes the plural, the
plural includes the singular, and the use of any gender includes any other gender, as circumstances may
require. The term "person" includes both natural persons and entities.
21. Headings. The headings contained in this Guaranty are for the convenience of the parties
only, and are not a part of the substantive agreement of the parties nor shall they affect the meaning or
interpretation of any provision of this Guaranty in any way.
22. Coo t--- er-Y?rre This Guaranty may be executed in multiple counterparts. When at least one
copy of this Guaranty has been executed by each part of this Guaranty, this Guaranty shall be in full force
and effect, and all of such counterparts shall be read together as a single agreement.
23. AdVise lrnm Inrtepenclen} C Quaset The parties understand that this is a legally binding
contract that may affect their rights. Each party represents that he has entered into this Guaranty freely and
voluntarily and without coercion of any kind whatsoever, and has had the opportunity to consult with
independent counsel.
24. GQVFRNINC` I AD ALL MATTERS REGARDING THE FORMATION,
INTERPRETATION, AND ENFORCEMENT OF THIS GUARANTY SHALL BE GOVERNED BY
PFNNSYI /ANIA IAW, EXCLUDING ITS LAWS RELATING TO CHOICE OF LAW.
IN WITNESS WHEREOF, the Guarantors have executed this Guaranty as of the day and year first
above written.
INDIVIDUAL GUARANTORS (If applicable):
Kenneth R. Paton
W. Douglas aardenburg
i
Landlord's Initials: I Tenant's Initials:
Page
' +?w r
CERTIFICATE OF SERVICE
I hereby certify that on this 20th day of March, 2009 a true and correct copy of the
foregoing First Amended Action for Declaratory Judgment has been served by first
class mail, postage prepaid upon the follow:
Alpha Omega Unlimited, LLC
40 Tannery Road
York, PA 17019
R. Mark Thomas, Esquire
101 South Market Street
Mechanicsburg, PA 17055-3851
Rees Griffiths
PA 21896
Marisa G. Button
PA 206767
135 North George Street
York, PA 17401
717-848-4900
717-843-4903 fax
Attorneys for Zur, Ltd.
{00291919/1)
14
01/,02/2009 11:05 17177617273 ZUR LTD PAGE 02''09
R. MARK THOMAS
Attomey at Law
101 South Market Street
Mechanicsburg, Pennsylvania 1.7055.3851
Telephone: (717) 796-2100
Zur, Ltd.
2230 Canterbury Drive
Mechanicsburg, PA 17055
Telefax: (717) 796-3600
Re: Warehouse Lease and Office Lease
3825 Hartzdale Drive, Camp Hill, Pennsylvania
Dear Zur, Ltd.:
Please be advised that you will find enclosed herewith separate invoices for past
due rent in connection with both the warehouse space and the office space at the above-
captioned location. Each space is invoiced separately. Also, an invoice for the January
2009 rent for each space is enclosed, Payment is due the Landlord on or before
January 1, 2009.
Enclosed also are three (3) separate Notices of Default which must be cured. The
Default for failure to pay additional rent must be cured by January 1, 2004, or Landlord
shall exercise all of its rights under Paragraph 23 of the leases. The Default in Tenant's
insurance coverage per the leases must be cured within ten (10) days commencing
January 1, 2009. Likewise, satisfaction proof that you have neither assigned nor
hypothecated Landlord's interest in the subleases you maintain with your subtenants must
be, provided to Landlord within ten (10) days commencing January 1, 2009. Landlord
reserves the right to determine the sufficiency of the proof offered to satisfy itself that
there is no default resulting from an assignment or hypothecation of the subleases.
EXHIBIT
-_C____
December 30, 2008
01/.0212009 11:05 17177617273 ZUR LTD PAGE 03109
Failure to cure the default in tenant's insurance coverage and/or failure to prove
that there has been no assignment or hypothecation of the subleases shall place you in
default.
Very truly yours,
R. Mark Thomas
RMTljIm
Enclosures
cc: Andrew Paxton, Esquire
Alpha Omega Unlimited, LLC
0140212009 11:05 17177617273 ZUR LTD PAGE 04109
NVTLU OF DEFAULT
Date of Notice: December 30, 2008
To: Zur, Ltd.
2230 Canterbury Drive
Mechanicsburg, PA 17055
Alpha Omega Unlimited, Ltd., has been notified that your commercial general
liability insurance coverage has lapsed due to non-payment of premiums. The
notification of lapse in coverage includes the casualty coverage, plate glass coverage, and
may include workers, compensation coverage.
You have until. January 1.0, 2009, to cure this default to the satisfaction of
Landlord or you will be in default. Landlord reserves. all its' rights under the torus of the
lease in the event of default.
Alpha Omega Unlimited, LLC
cc: Andrew Paxton, Esquire
01402/2009 11:05 17177617273 ZUR LTD
Date of Notice: December 30, 2008
To: ,fur, Ltd.
2230 Canterbury Drive
Mechanicsburg, PA 17055
PACE 05/09
A review of UCC Filings infers that you have hypothecated and/or assigned your
interests in the subleases to creditors other than the Landlord. Such hypothecation and/or
assigzunent would be a violation. of Paragraph 16 of the Lease.
The UCC Financing Statements in question are as follows:
1. File Number: 2006101701278
Filed: 10/13/2006
Creditor: Mid Penn Bank
2. File Number: 2006040502301
Filed: 03/30/2006
Creditor: Members I" Federal Credit Union
Demand is hereby made for proof that there has been no assignment and/or
hypothecation in regards to the two (2) subleases for subtenants occupying a portion of
your leasehold premises. If satisfactory proof is not provided to Landlord by January 10,
2009, Landlord will consider that you are in default under the lease. Landlord reserves
all of its rights under the lease in the event that you are in Default.
Alpha Omega. Unlimited, LLC
cc: Andrew Paxton, Esquire
01!.02/2009 11:05 17177617273 ZUR LTD PAGE 06'09
MOICE FOUR P ST DUE RENT
Office Space
3825 Hartzdale Drive
Camp Hill, PA
November 2008 Additional Rent - CAM
December 2008 Additional Rent - CAM
Interest @ 6% for November and December 2008
TOTAL
$467.08
$467.08
12.4Q
$946.56
DUE January X, 2009
. .01/-02/2009 11:05 17177617273 ZUR LTD PAGE 07109
BENT-
INVOICE FOR PAST D jj
Warehouse
3825 Hartzdale Drive
Camp Hill, PA
November 2008 Additional Rent - CAM $3,06938
December 2008 Additional Rent - CAM $3,06938
Interest ??a 6% for November and December 2008 $ 46,50
TOTAL $6,185.26
DUE 7anuary 1, 2009
_#01/.02/2009 11:05 17177617273 ZUR LTD PAGE 08/09
! DICE FOR JANUARY 2009 RE1?IT
Warehouse
3825 Hamdale Drive
Carne Hill, FA
January Rent $10,000.00
Additional Dent 3,069.38
TOTAL $13,069.38
DUE January 1., 2009
.01/.02/2009 11:0E 17177617273 ZUR LTD PAGE 09/09
INVOICzE I+ QR JANVARY 2009 REND`
Office Space
3825 Hartzdale Drive
Camp Hill, PA
January Rent
Additional Rent
TOTAL
DUE
January 1, 2009
$5,000.00
467,08
$ 5,467.08
CERTIFICATE OF SERVICE
I hereby certify that on this I st day of April, 2009 a true and correct copy of the
foregoing Second Amended Action for Declaratory Judgment has been served by first
class mail, postage prepaid upon the follow:
R. Mark Thomas, Esquire
101 South Market Street
Mechanicsburg, PA 17055-3851
Rees Griffiths
PA 21896
Marisa G. Button
PA 206767
135 North George Street
York, PA 17401
717-848-4900
717-843-4903 fax
Attorneys for Zur, Ltd.
{00293466/1} 14
HUD-OFIFU
OF THE R, CMOVOTAb Y
2909 APR -2 AM IO: 52
PENNSAMA
40
IN THE COURT OF COMMON PLEAS OF
CUMBERLAND COUNTY, PENNSYLVANIA
CIVIL ACTION - LAW
ZUR, LTD.,
2020 State Road
Camp Hill, Pennsylvania 17011
Plaintiff
V I Equity- Declaratory Judgment
ALPHA OMEGA UNLIMITED, LLC i 09-500-civil
40 Tannery Road i
Dillsburg, Pennsylvania 17019
Defendant
PRAECIPE TO SUBSTITUTE
TO THE PROTHONOTARY:
Please insert the attached original Verification to the 2°d Amended Action for Declaratory
Judgment filed with the above-captioned matter on April 2, 2009.
CGA W FIRM
Rees Gri fit .
Marisa G. Button
PA 206767
135 North George Street
York, PA 17401
717-848-4900
717-843-4903 fax
Attorneys for Zur, Ltd.
{00295985/1}
VERIFICATION
I hereby affirm that the following facts are correct. The attached Action for
Declaratory Judgment is based upon information, which has been furnished to counsel in
the preparation of this document. The language of the attached Action for Declaratory
Judgment is that of counsel and not mine. I have read the attached Action for
Declaratory Judgment and to the extent that the same is based upon information, which I
have given to counsel, it is true and correct to the best of my knowledge, information and
belief. To the extent that the content of the attached Action for Declaratory Judgment is
that of counsel, I have relied upon counsel in making this Verification. I hereby
acknowledge that the averments of fact set forth in the aforesaid attached Action for
Declaratory Judgment are made subject to the penalties of 18 Pa. C.S. 4904 relating to
unsworn falsification to authorities.
Date: 9 0,f7
By:
Ken aton
Date: C/ &
By:
Doug Waar enn
100293466/1) 13
Y '
CERTIFICATE OF SERVICE
I hereby certify that on this 13th day of April, 2009 a true and correct copy of the
foregoing Praecipe to Substitute Verification has been served by first class mail, postage
prepaid upon the follow:
R. Mark Thomas, Esquire
101 South Market Street
Mechanicsburg, PA 17055-3851
Rees Griffiths
PA 21896
Marisa G. Button
PA 206767
135 North George Street
York, PA 17401
717-848-4900
717-843-4903 fax
Attorneys for Zur, Ltd.
(0029598511)
FILED--URCE
OF THIE ,,,INOTARY
2009 APR 15 PFD 3: 01
CUM-
i
IN THE COURT OF COMMON PLEAS OF
CUMBERLAND COUNTY, PENNSYLVANIA
CIVIL ACTION - LAW
ZUR, LTD
2020 State
Camp Hill;
V.
ALPHA 0
40 Tanner
Dillsburg,
.,
Road
Pennsylvania 17011
Plaintiff
vIEGA UNLIMITED, LLC
Road
'ennsylvania 17019
Defendant
i
i
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Equity- Declaratory Judgment
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09-500-civil
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NOTICE OF PRAECIPE TO ENTER JUDGMENT BY DEFAULT
TO: Alp]
c/o l
101
DATE OF
Omega Unlimited, LLC
Mark Thomas
)uth Market Street
micsburg, PA 17055-3851
: May 28, 2009
IMPORTANT NOTICE
YOU ARE N DEFAULT BECAUSE YOU HAVE FAILED TO ENTER A WRITTEN
APPEA CE PERSONALLY OR BY ATTORNEY AND FILE IN WRITING WITH
THE COU T YOUR DEFENSES OR OBJECTIONS TO THE CLAIMS SET FORTH
AGAINST OU. UNLESS YOU ACT WITHIN TEN DAYS FROM THE DATE OF THIS
NOTICE, JUDGMENT MAY BE ENTERED AGAINST YOU WITHOUT A HEARING
AND YOU AY LOSE YOUR PROPERTY OR OTHER IMPORTANT RIGHTS.
YOU SHOT
HAVE A L,
THIS OFF]
LAWYER.
LD TAKE THIS PAPER TO YOUR LAWYER AT ONCE. IF YOU DO NOT
?WYER, GO TO OR TELEPHONE THE OFFICE SET FORTH BELOW.
CE CAN PROVIDE YOU WITH INFORMATION ABOUT HIRING A
(00304204/1)
IF YOU C NNOT AFFORD TO HIRE A LAWYER, THIS OFFICE MAY BE ABLE TO
PROVIDE YOU WITH INFORMATION ABOUT AGENCIES THAT MAY OFFER
LEGAL SERVICES TO ELIGIBLE PERSONS AT A REDUCED FEE OR NO FEE.
Cumberland County Bar Association
32 Bedford Street
Carlisle, PA 17031
717-249-3166
CGA LAW FIRM
Marisa G. Button, Esquire
PA #206767
(00304204/1)
CERTIFICATE OF SERVICE
certify that on this 28th day of May, 2009, a true and correct copy of the
foregoing Notice of Praecipe to Enter Default Judgment has been served first class mail postage
prepaid upon the following:
R. Mark Thomas
101 South Market Street
Mechanicsburg, PA 17055-3851
CGA LAW FIRM
Marisa G. Button, Esquire
(00304204/1)
t y
J! THE
20 9 9 it`s
IN THE COURT OF COMMON PLEAS OF
CUMBERLAND COUNTY, PENNSYLVANIA
CIVIL ACTION - LAW
ZUR, LTD.,
2020 State Road
Camp Hill, Pennsylvania 17011
Plaintiff
V. Equity - Declaratory Judgment
ALPHA OMEGA UNLIMITED, LLC 09-500-CIVIL
40 Tannery Road
Dillsburg, Pennsylvania 17019
Defendant
NOTICE TO PLEAD
TO: Zur, Ltd.
c/o CGA
135 North George Street
York, PA 17401
You are hereby notified to file a written response to the enclosed New Matter
within twenty (20) days from service hereof or a judgment may be entered against you.
R. Mark Thomas, Esquire
Attorney for Defendant
ID# 41301
101 S. Market Street
Mechanicsburg, PA 17055
(717) 796-2100
IN THE COURT OF COMMON PLEAS OF
CUMBERLAND COUNTY, PENNSYLVANIA
CIVIL ACTION - LAW
ZUR, LTD.,
2020 State Road
Camp Hill, Pennsylvania 17011
Plaintiff
V.
ALPHA OMEGA UNLIMITED, LLC
40 Tannery Road
Dillsburg, Pennsylvania 17019
Defendant
Equity - Declaratory Judgment
09-500-CIVIL
DEFENDANT'S ANSWER, NEW MATTER, AND COUNTERCLAIM
AND NOW, comes the Defendant, ALPHA OMEGA UNLIMITED, LLC, by and through its
counsel, R. Mark Thomas, Esquire, and files this Answer, New Matter, and Counterclaim, and in
support thereof, respectfully represents:
1. Admitted.
2. Denied. Defendant's address is 49 Tannery Road, Dillsburg, PA 17019.
COUNT I DECLARATORY JUDGMENT
3. Admitted.
4. Admitted.
5. Admitted.
6. Admitted.
7. Admitted.
8. Denied. Plaintiff s Complaint refers to Paragraph 2 for a definition of "Common
Areas". However, all definitions are contained within Paragraph 1 of the Lease
entitled "Definitions". The "Common Areas" as referred to in Paragraph 2 are merely
a description of areas that may be used in common with other tenants, but is not the
defined tern of "Common Areas" in this Lease.
9. Admitted only in so far as the description as provided in Paragraph 2 with respect to
the interior of the building which accounts for approximately 4% of the building's
interior.
10. Admitted.
11. Denied. "Common Area Charge" is not defined as a term within the Lease. Further,
Paragraph 5 (c) clearly states, "The Common Area Charge, subsection (b) above,
includes the costs of repairs to the roof and/or installation of a new roof, resurfacing
of parking lots, along with repairs and/or replacement of the air conditioning unit(s)
and heating system." Since the entire building is serviced by a single air conditioning
unit and heating system, the Plaintiff's Common Area Charge for these services is
equal to 79.5% of the entire costs of repairs and/or replacement of the air
conditioning unit(s) and heating system, along with 79.5% of the costs of repairs to
the roof and/or installation of a new roof, or resurfacing of the parking lots.
12. Admitted in part, denied in part. It is admitted that the language as quoted by the
Plaintiff in this paragraph is accurate. However, it is denied that the parties intended
that the Plaintiff would only be responsible for heating, ventilation, and air
conditioning costs of the Common Area since the Plaintiff occupies 79.5% of the
interior of the building for which heating, ventilation, and air conditioning is
provided.
13. Denied. Paragraph 5 (c) is limited to the placement of the items identified in
Paragraph 5 (c), i.e., installation of a new roof, resurfacing of parking lots,
replacement of the air conditioning units and heating system. The clear reading of
this paragraph shows that the year in which any of these items would be replaced
would result in a substantial Common Area Charge and, therefore, this fund was
created solely for the purpose of replacement of any of these large items.
14. Denied. Plaintiff's annual aggregate contribution is $10,740.00.
15. Admitted in part, denied in part. It is admitted that Plaintiff has paid all minimum
rent payments and additional rent payments through October 2008. However, it is
denied that these payments were always made on time.
16. Denied. Plaintiff is obligated to pay 79.5% of all costs related to heating, cooling,
and ventilating the entire building since Plaintiff occupies 79.5% of the building. It is
denied that Plaintiff's Common Area Charges are limited to 79.5% of 4% of the
building.
17. Denied. The language of the contract speaks for itself. It is denied that Plaintiff is
not liable for any HVAC Costs, unless and until Landlord has exhausted the Capital
Improvement Fund. As stated earlier, the Capital Improvement Fund is limited to
replacement costs of those items listed in Paragraph 5 (c).
18. Admitted. By way of further answer, Defendant was not obligated under the terms of
the Lease to pay for HVAC repairs from the Capital Improvement Fund.
19. Admitted.
20. Denied. As previously stated, Plaintiff was responsible under the terms of the Lease
for 79.5% of the repair costs to the HVAC system. By way of further answer, no
where in the lease is reference made to a 4% Common Area which would limit the
Plaintiff s costs for HVAC repairs.
21. Admitted. Further, Defendant was not obligated to limit Plaintiffs Common Area
Charge to a pro-rata share of only 4% of the building.
22. Denied as stated. Defendant charged Plaintiff 79.5% of the costs of repairs to the
HVAC system. Said costs are specifically referred to in Paragraph 5 (c) of the Lease
and Plaintiff has willingly and knowingly paid these costs from February 2006
through October 2008. It is admitted that the Defendant did not debit the Capital
Improvement Fund for these expenditures.
23. Denied. Plaintiff has paid its pro-rata portion of the costs of repairs to the HVAC
system as such repairs were required for the proper operation of that system.
Defendant has not utilized any of the funds designated to the Capital Improvement
Fund since the HVAC system has not been replaced.
24. Denied. Plaintiff has only paid for the costs of building improvements that were
requested by the Plaintiff and which directly impacted the Plaintiff s use of the leased
premises. With regard to the gas utility security deposit, Plaintiff inquired as to why
the deposit was included in the Common Area Charges and it was explained to Ken
Paton that the tenants would receive their portion of the security deposit back in 2
years with interest, to which Ken Paton agreed. The security deposit with interest
was returned to Plaintiff.
25. Denied. Any building improvements were made at the request of and for the benefit
of Plaintiff.
26. Admitted in part, denied in part. Although the charges may not have been Common
Area.Charges per se, the improvements that were made to the building were made for
the benefit of the Plaintiff and at the Plaintiff's request. Any improvements initiated
by the Defendant were paid for entirely by the Defendant.
27. Denied. Defendant properly listed all Common Area Charges for the years 2006,
2007, and 2008. Defendant agreed with those charges and made payment to the
Defendant accordingly up through October 2008.
28. Denied. Plaintiff s payments of additional rent were based upon Plaintiff's
understanding of the Lease as was intended by the parties when the Lease was
executed.
29. Denied. This allegation is a conclusion of law to which no responsive pleading is
required and, therefore, same is denied. By way of further answer, the Plaintiff has
not made any overpayments on Common Area Charges to the Defendant.
30. Admitted. Defendant did not recalculate and allocate expenses according to
Plaintiff's new interpretation of the Lease agreement, but continued to make Common
Area Charges to Plaintiff as the parties had previously agreed.
31. Denied. Plaintiff was in default of the Lease for failing to make payments as
previously agreed upon. Defendant was merely exercising its rights under the terms
of the Lease by notifying Plaintiff that Plaintiff was in default.
32. Admitted in part, denied in part. It is admitted that Plaintiff has failed to pay its full
additional rent to the Defendant since November 2008. It is denied that Defendant
was in any way required to acknowledge Plaintiff's new interpretation of the
agreement and to rectify Common Area charges based on Plaintiff s unilateral
interpretation of the agreement.
33. Denied. The escrowed amount of $3,535.46 is limited to the end of the third year of
the Lease term. It is also subject to change based upon a reconciliation of the actual
Common Area Charges for the third year of the Lease term. It is also subject to an
increase commencing on February 10, 2009, based upon the reconciliation of past
Common Area Charges.
34. Denied. It is denied that there are any erroneous Common Area Charges. Plaintiff s
attempt to work out an agreement was based upon Plaintiffs desire to have the
previously agreed upon Lease changed for Plaintiff s benefit.
35. Admitted.
36. Admitted. By way of further answer, Defendant never agreed that Plaintiff would be
allowed to escrow the disputed amounts of rent with Plaintiffs law firm.
37. Denied. Based upon information and belief, as well as recorded documents with the
Pennsylvania Department of State, Defendant believes and therefore avers that
Plaintiff has violated the terms of the Lease by granting a security interest in Leases
which Plaintiff maintains with subtenants to Plaintiff's lenders, in violation of the
Lease.
38. Admitted.
39. Admitted.
40. Admitted in part. Denied in part. It is admitted that the letter of January 30, 2009,
did not include an accounting statement, but an accounting statement was
subsequently provided to Plaintiff.
41. Admitted in part. Denied in part. Admitted only that the accounting statement
provided for a 2% increase in Common Area Charge for 2009. It is denied that this
increase was erroneously calculated. Plaintiff does not assert in this paragraph the
basis for it's' claim that the Common Area Charges were erroneously calculated and,
therefore, Defendant cannot respond beyond a simple denial with a demand for strict
proof of Plaintiff's allegation at time of trial.
42. Admitted.
43. Admitted in part. Denied in part. Admitted that Defendant erroneously included the
estimated PPL increase for 2009. However, it is denied that the lease prohibits
Defendant from estimating what Plaintiff's Common Area Charge will be for any
given year.
44. No answer required.
45. Admitted.
46. Denied. Plaintiff is currently in default under the warehouse lease agreement due to
its failure to pay additional rent as set forth in the lease.
47. Denied. Plaintiff is already in default for failure to pay additional rent.
48. Denied. Plaintiff has full knowledge of its responsibility to pay additional rent.
Further, Plaintiff had paid its additional rent for 2 %z years with full knowledge of its
obligation to pay these amounts up through October 2008.
49. Admitted.
WHEREFORE, Defendant, ALPHA OMEGA UNLIMITED, LLC, prays that this Honorable
Court will deny Plaintiff s requested relief and enter an Order consistent with Defendant's
request for relief following Defendant's averred New Matter.
NEW MATTER
50. The answers set forth in paragraphs 1 through 49 are incorporated herein as if set
forth at length.
51. It is believed and therefore averred that Kenneth R. Paton and W. Douglas
Waardenburg are the sole owners of ZUR, LTD., the limited liability corporation
which is the Plaintiff in this action.
52. Kenneth R. Paton and W. Douglas Waardenburg were also officers in Christian
Publications, Inc., (hereinafter referred to as "CPI"), the previous owner of the
building located at 3825 Hartzdale Drive, Camp Hill, Pennsylvania, which is the
building in which the leasehold premises is located.
53. Defendant, Alpha Omega Unlimited, LLC, purchased the building located at 3825
Hartzdale Drive, Camp Hill, Pennsylvania, from CPI on February 10, 2006.
54. Kenneth R. Paton negotiated the terms of this sale on behalf of CPI and was
intimately familiar with the condition of the building, including the mechanical
systems and utility systems that provided service to the building.
55. Kenneth R. Paton knew, or had reason to know, that the HVAC system for the
building was in regular need of repairs due to its age and due to internal modifications
that had been done to the building by CPI which put tremendous stress on the HVAC
system which was not designed to service the building with the internal modifications
which had been made by CPI.
56. Neither Kenneth R. Paton nor anyone else from CPI disclosed to Alpha Omega
Unlimited, LLC, of the true condition of the HVAC system at 3825 Hartzdale Drive
prior to consummation of the sale of the building to Alpha Omega Unlimited, LLC,
on February 10, 2006.
57. In fact, Kenneth R. Paton misrepresented the true condition of the HVAC system by
representing that the only problem with the air conditioning system was the need for a
new compressor.
58. At settlement on February 10, 2006, an escrow account was established with sale
proceeds to purchase a new compressor for the air conditioning unit.
59. The lease which is the subject of the current litigation had been negotiated and a draft
prepared prior to February 10, 2006, but it was not finalized until after settlement on
February 10, 2006, when all parties were present and represented by counsel, either in
person or by conference call.
60. As of February 10, 2006, both parties knew that the entire building was serviced by a
single electric meter, a single gas meter, and a single HVAC system for the provision
of air conditioning and heating.
61. The understanding of the parties was that ZUR, LTD., which leased 79 %% of the
interior of the building, would be liable for 79 '/s% of the costs of services to the
building, to include 79 %z% of the costs of repairs to these systems.
62. In recognition of the tremendous financial burden that any tenant, including ZUR,
LTD., would face in any year where the roof would need to be replaced, the parking
lots required resurfacing or the HVAC system would need to be replaced, paragraph 5
(c) was inserted in the lease.
63. Paragraph 5 (c) creates a Capital Improvements Fund whereby each tenant would pay
its pro rata share of a fund which would accumulate at the rate of $1,000.00 per
month for a period of ten (10) years, and which was to be used solely to cover the
cost of replacement of the roof, replacement of the HVAC system, or the resurfacing
of the parking lots in any year in which such costs were required.
64. This paragraph 5 (c) was discussed in detail on February 10, 2006, as evidenced by
ZUR's insistence that the amount to be contributed monthly not be subject to change
for the ten (10) year period set forth in the lease.
65. This paragraph 5 (c) clearly distinguishes between repairs to these particular systems
or parking lots and the need to replace these items in any one (1) year.
66. This paragraph 5 (c) clearly states that the costs of repairs to these named systems
were to be included in the Common Area Charge which was not capped in the
manner in which the Capital Improvements Fund was capped.
67. From February 10, 2006, through October 2008, ZUR, LTD., complied with this
understanding that their Common Area Charge included 79 1/2% of the costs of
repairs to the HVAC system.
68. During the time period of February 10, 2006, to October 2008, ZUR, LTD., never
questioned that it was responsible for it's pro rata share of these costs of repairs.
69. Starting November 2008, ZUR, LTD., unilaterally decided not to continue to pay it's
pro rata share of the costs of repairs to the HVAC system.
70. Based upon ZUR's knowledge of the condition of the air conditioning system as of
February 10, 2006, ZUR knew, or had reason to know, that the costs of repairs
required for the air conditioning would be significant, as would its 79 %2% pro rata
share of these costs.
71. With this knowledge and understanding, ZUR, LTD., made these payments of
additional rent, without complaint, until November 2008, when, following the advice
of new counsel, they denied their responsibility to help pay for these costs pursuant to
the lease.
72. Despite their knowledge of the condition of the air conditioning system prior to
executing the lease and their willingness to pay their share of the repair costs for 2 %2
years, ZUR, LTD., now claims that they were never required under the lease to pay
their pro rata share of these costs.
73. ZUR, LTD., asks this Court of equity to give them relief from their bargained for
costs under the lease, yet ZUR, LTD., does not come into this Court with clean hands.
74. ZUR, LTD., is in breach of the terms of the lease and is, therefore, subject to the
default provisions of paragraphs 23, et. seq., of the lease dated February 10, 2006.
WHEREFORE, Defendant, ALPHA OMEGA UNLIMITED, LLC, prays that this Honorable
Court will enter an Order directing the following:
A. Although there is apparent ambiguity in the lease with regard to the term
"Common Area Charges" it is clear that the parties intended that Plaintiff would
be charged as additional rent Seventy-Nine and One-Half Percent (79 %z%) of the
costs of repairs to the heating and air conditioning system;
B. That Plaintiff is in default under the terms of the lease due to its failure to pay this
additional rent from November 2008 to present;
C. That Plaintiff's counsel be directed to forthwith turn over all funds accumulated in
its escrow account, with interest, in which counsel has accumulated this additional
rent without the consent of Defendant; and
D. That the Defendant may exercise all the remedies available to Landlord under the
Default provisions of the lease dated February 10, 2006.
COUNTERCLAIM
75. The answers and averments pled in paragraphs 1 through 74 are incorporated herein
as if set forth at length.
76. Both Plaintiff and Defendant are engaged in selling curriculum materials to numerous
churches in the central Pennsylvania area..
77. Artistic Manufacturing Company, ( hereinafter referred as "Artistic"), is a vendor
who supplies inventory to both Plaintiff and Defendant for resale by the parties.
78. Plaintiff was not able to acquire credit from Artistic and requested assistance from
Defendant to acquire inventory from Artistic for the benefit of Plaintiff.
79. Plaintiff and Defendant verbally agreed that Defendant would place orders with
Artistic for the benefit of Plaintiff provided Plaintiff paid Defendant for the orders
prior to the orders being placed and provided the requested orders were made directly
through either Charles Fichtner or Vicki Fichtner.
80. This arrangement worked well for several orders which were made according to this
arrangement.
81. On several occasions in 2006, unbeknownst to Charles Fichtner or Vicky Fichtner,
Plaintiff placed orders for Artistic product directly through Defendant's employees
and without prepaying for these orders as had been agreed.
82. To maintain its' good credit rating with Artistic, Defendant was compelled to pay for
the orders improperly placed with Artistic for the benefit of Plaintiff since the orders
were placed under Defendant's account. The total paid by Defendant was
$15,918.80.
83. Artistic delivered the goods to Defendant who then gave the goods to Plaintiff.
84. Plaintiff has failed to pay Defendant the $15,918.80 despite repeated requests from
Defendant.
85. Plaintiff has been unjustly enriched at the expense of Defendant who was billed by
Artistic in the amount of $15,918.80 for the goods and paid for same in order to retain
its good credit standing with Artistic.
WHEREFORE, Defendant, ALPHA OMEGA UNLIMITED, LLC, prays that judgment be
entered in favor of Defendant and against Plaintiff in the amount of $15,918.80, with interest
from August 2006.
Respectfully submitted,
R. ark Thomas, Esquire
Attorney No. 41301
101 South Market Street
Mechanicsburg, PA 17055
Telephone: 717-796-2100
Attorney for Defendant
VERIFICATION
I, CHARLES R. FICHTNER, hereby verify that the statements
made in the foregoing Answer and New Matter are true and correct.
I understand that false statements herein are made subject to the
penalties of 18 Pa. C.S. §4904, relating to unsworn falsification
to authorities.
c
41?1
Dated: June 8, 2009
CHARLES R. FICHTNER
VERIFICATION
I, VICTORIA A. FICHTNER, hereby verify that the statements
made in the foregoing Answer and New Matter are true and correct.
I understand that false statements herein are made subject to the
penalties of 18 Pa. C.S. §4904, relating to unsworn falsification
to authorities.
Dated: June 8, 2009
VICTORIA A. FICHTNER
FILED-OFFICE
OF THE 2034 JUN 12 Fi 12: 09
41Y
ZUR, LTD., IN THE COURT OF COMMON PLEAS OF
Plaintiff CUMBERLAND COUNTY, PENNSYLVANIA
v. CIVIL ACTION -LAW
ALPHA OMEGA
UNLIMITED, LLC,
Defendant N0.09-500 CIVIL TERM
IN RE: EMERGENCY MOTION FOR TEMPORARY
SPECIAL INJUNCTION AND PRELIMINARY INJUNCTION
ORDER OF COURT
AND NOW, this 22nd day of July, 2009, the prior deadline for submitting briefs in
the above matter is hereby extended and briefs are due in ten days from July 22, 2009.
BY THE COURT,
i
J. W~ ey Oler, Jr.,
~s Griffiths, Esq.
Marisa G. Button, Esq.
13 5 North George Street
York, PA 17401
Attorneys for Plaintiff
,Mark Thomas, Esq.
101 South Market Street
Mechanicsburg, PA 17055-3851
Attorney for Defendant
:rc
a
aF TI-i~ ~~'~?"~'.'~'c~TARY
2009 .ltl~ 22 P~ l ~ 55
CCJIY~nt.~r4 i' i~%;d 1L; qui~~~~~
i ~~ ~1~1a"S~~~if!-5f tit-?
ZUR, LTD., IN THE COURT OF COMMON PLEAS OF
Plaintiff CUMBERLAND COUNTY, PENNSYLVANIA
v. CIVIL ACTION -LAW
ALPHA OMEGA
UNLIMITED, LLC.,
Defendant N0.09-500 CIVIL TERM
IN RE: PLAINTIFF'S MOTION FOR PRELIMINARY INJUNCTION
BEFORE OLER, J.
ORDER OF COURT
AND NOW, this 12~` day of August, 2009, upon consideration of Plaintiff s
Motion for Preliminary Injunction, following a hearing, and for the reasons given in the
accompanying opinion, the Motion is denied.
gees Griffiths, Esquire
Marisa G. Button, Esquire
135 North George Street
York, PA 17401
Attorneys for Plaintiff
Mark Thomas, Esquire J
101 South Market Street
Mechanicsburg, PA 17055-3851
Attorney for Defendant
BY THE COURT,
i
ZUR, LTD., IN THE COURT OF COMMON PLEAS OF
Plaintiff CUMBERLAND COUNTY, PENNSYLVANIA
v. CIVIL ACTION -LAW
ALPHA OMEGA
UNLIMITED, LLC.,
Defendant N0.09-500 CIVIL TERM
IN RE: PLAINTIFF'S MOTION FOR PRELIMINARY INJUNCTION
BEFORE OLER, J.
OPINION and ORDER OF COURT
OLER, J., August 12, 2009.
In this civil action arising out of an alleged overcharge by a landlord of a tenant,
Plaintiff tenant has sued Defendant landlord seeking a declaratory judgment as to the
extent of its obligation to pay certain "Additional Rent" expenses related to the leased
premises. For disposition at this time is Plaintiff's motion for a preliminary injunction to
prevent its eviction pending disposition of the suit. ~
A hearing was held on the motion on March 23, 2009, and June 8, 2009. For the
reasons stated in this opinion, a preliminary injunction will not be issued.
STATEMENT OF FACTS
The facts in this case are, to some extent, not in dispute. Plaintiff is Zur, Ltd.
(hereinafter Zur), a limited liability company in the business of distributing religious
publications, and having its principal office at 2020 State Road, Camp Hill, Cumberland
County, Pennsylvania, and leasing warehouse space at 3825 Hartzdale Drive, Camp Hill,
Cumberland County, Pennsylvania.2 Zur is co-owned by Kenneth Baton and Doug
Waardenburg. Defendant is Alpha Omega Unlimited, LLC (hereinafter Alpha Omega), a
limited liability company and owner and landlord of the premises at 3825 Hartzdale
' Plaintiff's Motion for Preliminary Injunction, filed January 30, 2009 (hereinafter Plaintiff's Motion for
Preliminary Injunction).
z Plaintiffs Complaint para. 1.
Drive, Camp Hill, Cumberland County, Pennsylvania. Alpha Omega is co-owned by
Charles Finchtner and his spouse. Zur's complaint alleges that in February of 2006 the
parties entered into a commercial lease agreement whereby Zur leased warehouse space
in the building located at the Hartzdale Drive address from Alpha Omega, for a period of
ten years, said space consisting of 69% of the building,3 and that the parties also entered
into a commercial lease agreement to lease office space to Zur, at the same location, for a
period of three years, said space consisting of 10.5% of the building.4
Paragraph 5(b) of both lease agreements ("the Leases") is entitled "Common Area
Charge" and provides in pertinent part as follows:
Tenant shall pay as Additional Rent its pro-rata share of the cost
of operating, replacing improving, maintaining, repairing, and
refurbishing the Common Areas (`Common Area Charge'), which
for purposes of this Section only, shall include all roofs of the
Building. Such costs shall include, without limitation, materials
supplies, equipment, and services purchased or hired; equipment
used for the maintenance of the Common Areas; landscaping,
gardening, planting, cleaning, painting, striping parking areas,
repaving, lighting, and sanitation; removing snow, ice, and
garbage; heating, ventilating, and air-conditioning the enclosed
areas other than the Leased Premises; fire protection and on-site
security [sic] if provided by the Landlord in its sole discretion),
water and sewage charges, storm water maintenance fees,
electricity and other utility services, costs of personnel, payments
to governmental authorities, costs of complying with rules and
regulations of governmental authorities, Fire Insurance Rating
Organizations, Board of Fire Underwriters, insurance carriers, and
other organizations having jurisdiction over the Building; and
Landlord's administrative costs (including any management fee
payable by Landlord) in connection with the operation of the
Building ("Common Area Costs") ....5
s Plaintifi's Complaint, para. 4.
a Plaintiffls Complaint para. 5, 25.
s Plaintif'i's Ex. 1, Hearing, March 23, 2009.
2
Paragraph 5(c) of the Leases is entitled "Capital Improvements Fund" and
provides in pertinent part as follows:
The Common Area Charge, subsection (b) above, includes the
costs of repairs to the roof and/or installation of a new roof,
resurfacing of parking lots, along with repairs and/or replacement
of the air conditioning unit(s) and heating system. These four (4)
items could result in a substantial "Common Area Charge" for the
year in which any of these items would need to be replaced.
Therefore, a Capital Improvements Fund, (hereinafter the
"Fund"), limited in purpose to the roof, parking lot [sic] air
conditioning unit(s) and heating system shall be established.
Tenant shall pay as Additional Rent its pro-rata share of the
Capital Improvements Fund on a monthly basis. The Fund is
hereby capped at $120,000.00, which amount is to be
accumulated over a ten (10) year period. The determination of the
need for Capital Improvements to the four (4) items listed above
shall be at the .sole discretion of the Landlord ....6
Zur's complaint consists of one count for a declaratory judgment, and alleges that
Alpha Omega, as landlord, has improperly failed to deduct costs of HVAC repair from
the Capital Improvements Fund; that it has improperly failed to debit the Capital
Improvements Fund to cover certain HVAC expenses;g that it has erroneously charged
Zur, as tenant, 79.5% of all HVAC and other varying costs as Common Area Charges;9
and that it has improperly included costs of building improvements for the benefit of the
landlord, and a gas utility deposit related to natural gas utility service turn-on for the
entire building, as Common Area Charge expenses.lo
Zur has also filed a motion for a preliminary injunction, which is the subject of
this opinion. l l In this motion, Zur seeks to preliminarily enjoin Alpha Omega from doing
6 Plaintiff's Ex. 1, Hearing, March 23, 2009.
Plaintiff's Complaint para. 18.
s Plaintiff's Complaint para. 22.
9 Plaintiff's Complaint para. 20.
10 Plaintiff s Complaint para. 25.
11 Plaintiff's Motion for Preliminary Injunction.
3
any of the following: taking possession of the premises and/or any or all goods,
inventory, equipment, fixtures or any other personal property belonging to Zur, within the
leased premises; conducting any public or private sale of Zur's goods, inventory,
equipment, fixtures or any other personal property of Zur; and from exercising any other
remedies for default under Paragraph 23.2 of the Leases. Paragraph 23(a) provides in
pertinent part:
With or without judicial process, [in the event of Default,
Landlord may] enter the Premises and take possession of any and
all goods, inventory, equipment and all other personal property of
Tenant, which is or may be put into the Premises during the Term,
whether exempt or not from sale under execution or attachment (it
being agreed that said property shall at all times be bound with a
lien in favor of Landlord, provided however that any such lien
shall be subordinate to any and all secured creditors of Tenant
...) and Landlord may sell all or any part thereof at public or
private sale . , , , i2
The evidence at the hearing on Zur's motion for a preliminary injunction may be
summarized as follows. The witnesses called on behalf of Zur were Kenneth Baton, co-
owner of Zur, and William Waardenburg; the witness called on behalf of Alpha Omega
was Charles Finchtner, co-owner of Alpha Omega. Testimony of these witnesses reveals
that much of the contractual dispute between the parties centers on the interpretation of
paragraphs 5(b) and 5(c). A large portion of Zur's concern with the allocation and
disbursement of funds stems from HVAC charges imposed upon Zur in the form of
Common Area Charges. Zur contends that air conditioning service repairs should have
been charged to the Capital Improvement Fund, in accordance with its interpretation of
paragraphs 5(b) and 5(c) of the Leases. It is Alpha Omega's contention that such repairs
to the HVAC system are to come out of the Common Area Charges, in accordance with
its interpretation of paragraphs 5(b) and 5(c) of the Leases. Zur also challenges the
1z Plaintiff's Ex. 1, Hearing, March 23, 2009.
4
purchase of other items billed as Common Area Charges, which it feels were improperly
billed to it pursuant to a pro-rata share of 79.5%.i3
Zur's witness testified that, in August of 2006, Zur
became concerned about some building that was being done in the
building, renovations. They were going to be charged to the
Common Area Maintenance, and so over time -- we did pay
those, but over time we noticed that this was escalating very
quickly and it involved -- in 2007 we realized it was almost like
having a blank check in our bank account as these things were
escalating quickly, and we thought that some of the things in the
Common Area Maintenance did not belong there.'a
Zur's witness further testified that Zur attempted to come up with a calculation,
based on copies of receipts and invoices paid by the landlord, that it believed was a "fair"
Common Area Maintenance charge.15 Zur's witness testified that Zur continued to pay
the monthly rent to Alpha Omega, continued to pay into the Capital Improvements Fund,
and continued to pay Common Area Charges to Alpha Omega that it did not disagree
with, but eventually began to put the "disputed-upon" Common Area Charges into
escrow.
On cross-examination, Zur's witness testified as to Zur's contention that
paragraphs 5(b) and 5(c) of the Leases require Zur to pay 69% (its current pro-rata share,
as the office space Lease has ended) of only 4% of the total building fees with respect to
certain items, such as "heating and air conditioning and roof repairs, which would be in
the Capital Improvement Fund" and not attributable to the Common Area Charges.16
Zur's witness conceded that "that is not what it (the Lease) says," but expressed Zur's
13 N.T. 12, Hearing, March 23, 2009, (hereinafter N.T. (March 23, 2009) ~. Among the other items
billed as Common Area Charges, Zur challenges the purchase of "Duty's Locks," "Interior building
renovations," "a tractor to mow grass," and "the prepayment of a UGI utility bill." N.T. (March 23, 2009)
12.
'a N.T. (March 23, 2009) 10.
15 N.T. (March 23, 2009) 10-11.
16 N.T. (March 23, 2009) 26.
5
belief that "there should be a common area ...."'~ Zur's witness testified that in 2006,
2007, and most of 2008 Zur continued to pay these disputed Common Area Maintenance
charges, believing that "it is sometimes just not worth having a battle, and so as we
looked at the cost, it was beginning to escalate, and there were replacement items being
done, and it came to our attention."18 Zur's witness also acknowledged that the repairs
done to the air conditioning system were legitimate; however, it is Zur's position that the
payment should have been deducted from the Capital Improvement Fund, and not
charged to Zur as a Common Area Maintenance fee included in the Additional Rent.
Alpha Omega's witness, Charles Finchtner, testified as to the dollar amounts of
the rent and Additional Rent Expenses, as well as to Alpha Omega's belief regarding the
purpose and uses of both the Common Area Maintenance charges and the Capital
Improvement Fund. With respect to the rent, in regard to the warehouse space currently
being rented by Zur, the basic monthly rent for said space is specified to be $10,000.00
per month. In addition to this basic monthly figure, there are Additional Rent Expenses,
authorized by paragraph 5(b) of the Leases, for Common Area Charges. Alpha Omega's
witness testified as to how these Common Area Charges were calculated. The initial
amount for the Common Area Charges was estimated at $12,000.00 for the first year. It
was from this figure that Zur was to pay its estimated pro-rata share of 69% for the
warehouse space, and 10.5% for the office space. The Common Area Charges were first
adjusted five months after the lease commenced, and Alpha Omega's witness testified
that "by the last day of July we were in the red by $29,545," largely due to the costs of
repairs to the air conditioning unit.19 Alpha Omega's witness further testified that this
shortfall was spread over the next 17 months, and the next calculation of Common Area
Charges was in January of 2008. With respect to the Capital Improvement Fund, also
charged as Additional Rent Expenses, Alpha Omega's witness testified "the intent of the
fund was to build up a fund with the maximum of $120,000 at $1,000 a month. A
" N.T. (March 23, 2009) 27.
'g N.T. (March 23, 2009) 33.
19 N.T. (March 23, 2009) 58-59.
6
thousand dollars a month being charges to each of the tenants at 69 percent, 10 '/z, and 20
'/Z.,,ao
Alpha Omega's witness also testified as to Alpha Omega's belief regarding the
purpose and uses of both the Common Area Maintenance charges and the Capital
Improvement Fund. "The discussions were for the purpose of the fund, and it was
discussed that the fund would be there for major expenses, such as the replacement of the
roof, the replacement of the HVAC system."Z' Alpha Omega's witness testified that there
was no discussion, during the creation of the Leases, related to use of the Fund for
repairs. "The Fund was limited to replacement." 22 He also stated that Zur had not
previously complained about paying for the air conditioning repair bills, and that even
into 2008 it paid them according to the new adjusted Common Area Maintenance
charges. It was in November of 2008 that, according to Mr. Finchtner, Zur began to
withhold $3,536.46 per month, and he testified that since that time he has been forced to
personally pay the bills for the heating and air conditioning repairs.
DISCUSSION
Statement of law. With respect to preliminary injunctions, the Pennsylvania
Supreme Court has stated as follows:
First, a party seeking a preliminary injunction must show
that an injunction is necessary to prevent immediate and
irreparable harm that cannot be adequately compensated by
damages. Second, the party must show that greater injury would
result from refusing an injunction than from granting it, and,
concomitantly, that issuance of an injunction will not substantially
harm other interested parties in the proceedings. Third, the party
must show that a preliminary injunction will properly restore the
parties to their status as it existed immediately prior to the alleged
wrongful conduct. Fourth, the party seeking an injunction must
show that the activity it seeks to restrain is actionable, that its
right to relief is clear, and that the wrong is manifest, or, in other
words, must show that it is likely to prevail on the merits. Fifth,
20 N.T. (March 23, 2009) 57.
zi N.T. (March 23, 2009) 57.
z2 N.T. (March 23, 2009) 57.
7
the party must show that the injunction it seeks is reasonably
suited to abate the offending activity. Sixth and finally, the party
seeking an injunction must show that a preliminary injunction will
not adversely affect the public interest.
Summit Towne Centre, Inc. v. Shoe Show of Rocky Mount, Inc., 573 Pa. 637, 647, 828
A.2d 995, 1001 (2003) (citations omitted).
Although parties seeking a preliminary injunction are not required to produce
absolute proof of their claims in order to demonstrate a right to injunctive relief, parties
must, at a minimum, offer sufficient evidence to show a "strong likelihood of success on
the merits." Temple Univ, v. Allegheny Health Educ. & Research Found., 456 Pa. Super.
314, 327, 690 A.2d 712, 718 (1997).
"In order to obtain a preliminary injunction, the movant must ... `make a strong
showing that it is likely to prevail on the merits'...." Enterra Corporation v. SGS
Associates, 600 F. Supp. 678, 683 (E.D. Pa. 1985), quoting Klitzman, Klitzman &
Gallagher v. Krut, 744 F.2d 955, 958-59 (3d Cir. 1984).
"For a right to be `clear,' it must be more than merely `viable' or `plausible. "'
Ambrogi v. Reber, 2007 Pa. Super. 278, ¶ 30, 932 A.2d 969, 980, quoting Anglo-
American Insurance Company v. Molin, 547 Pa. 504, 691 A.2d 929, 933-34 (1997).
"However, this requirement is not the equivalent of stating that no factual disputes exist
between the parties." Ambrogi v. Reber, 2007 Pa. Super. 278, ¶ 30, 932 A.2d 969, 980,
citing All-Pak, Inc. v. Johnston, 694 A.2d 347, 350 (Pa.Super. 1997).
APPLICATION OF LAW TO FACTS
With respect to Plaintiff's Motion for a Preliminary Injunction to preclude
Defendant (a) from taking possession of the premises and/or any or all goods, inventory,
equipment, fixtures or any other personal property belonging to Plaintiff, and located
within the leased premises, (b) from conducting any public or private sale of Plaintiff's
goods, inventory, equipment, fixtures or any other personal property of Plaintiff, and (c)
from exercising any other remedies for default under Paragraph 23.2 of the Leases, the
Court is unable to accept Plaintiff's contention that its right to relief is clear. Although the
8
parties both have expectations and intentions ftom the Leases, and although Plaintiff may
ultimately be able to make a showing of the propriety of a Declaratory Judgment in its
favor by the court, and although the evidence from the hearing shows a disagreement as
to the intention of paragraphs 5(b) and 5(c) of the Leases, the evidence set forth, at this
point, cannot be said to constitute a strong showing that Plaintiff will prevail on the
merits. The court finds it difficult, based on the wording of paragraph 5(c), to conclude as
Plaintiff would have it conclude, that the repairs to the HVAC system are not to be
withdrawn from the Common Area Charge. Paragraph 5(c) on its face indicates that "the
Common Area Charge, subsection (b) above, includes the costs of repairs to the roof
and/or installation of a new roof, resurfacing of parking lots, along with repairs and/or
replacement of the air conditioning unit(s) and heating system,"23 and at least on the
surface is inconsistent with Plaintiff's interpretation of the Leases as requiring repairs to
be charged to the Capital Improvements Fund. Accordingly, the following order of court
will be entered.
ORDER OF COURT
AND NOW, this 12`t' day of August, 2009, upon consideration of Plaintiff's
Motion for Preliminary Injunction, following a hearing, and for the reasons given in the
accompanying opinion, the Motion is denied.
BY THE COURT,
s/ J. Wesley Oler, Jr.
J. Wesley Oler, Jr., J.
Rees Griffiths, Esquire
Marisa G. Button, Esquire
13 5 North George Street
York, PA 17401
Attorneys for Plaintiff
zs Plaintiff s Ex. 1, Hearing, March 23, 2009.
9
R. Mark Thomas, Esquire
101 South Market Street
Mechanicsburg, PA 17055-3851
Attorney for Defendant
10
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