þ
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ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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o
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TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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INUVO, INC.
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(Exact name of registrant as specified in its charter)
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Nevada
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87-0450450
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(State or other jurisdiction of incorporation or organization)
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(I.R.S. Employer Identification No.)
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143 Varick Street, New York, NY
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10013
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(Address of principal executive offices)
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(Zip Code)
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Title of each class
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Name of each exchange on which registered
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Common Stock
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NYSE Amex
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Large accelerated filer
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o
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Accelerated filer
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o
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Non-accelerated filer
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o
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Smaller reporting company
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þ
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Page No.
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Part I
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Item 1.
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Business.
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5 | |||
Item 1A.
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Risk Factors.
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11 | |||
Item 1B.
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Unresolved Staff Comments.
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22 | |||
Item 2.
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Properties.
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22 | |||
Item 3.
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Legal Proceedings.
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23 | |||
Item 4.
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Mine Safety Disclosures
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25 | |||
Part II
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Item 5.
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Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities.
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26 | |||
Item 6.
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Selected Financial Data.
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27 | |||
Item 7.
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Management's Discussion and Analysis of Financial Condition and Results of Operation.
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27 | |||
Item 7A.
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Quantitative and Qualitative Disclosures About Market Risk.
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39 | |||
Item 8.
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Financial Statements and Supplementary Data.
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39 | |||
Item 9.
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Changes In and Disagreements With Accountants on Accounting and Financial Disclosure.
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40 | |||
Item 9A.
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Controls and Procedures.
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40 | |||
Item 9B.
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Other Information.
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41 | |||
Part III
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Item 10.
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Directors, Executive Officers and Corporate Governance.
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42 | |||
Item 11.
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Executive Compensation.
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42 | |||
Item 12.
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Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters.
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42 | |||
Item 13.
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Certain Relationships and Related Transactions, and Director Independence.
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42 | |||
Item 14.
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Principal Accountant Fees and Services.
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42 | |||
Part IV
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Item 15.
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Exhibits, Financial Statement Schedules.
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43 |
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Revenue;
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Primary operating costs and expenses;
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Capital expenditures;
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Operating lease arrangements;
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·
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Evaluation of possible acquisitions of or investments in business, products, and technologies; and
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diversified revenue streams which should mitigate our dependence on one major customer;
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an existing install and distribution capability through Vertro’s ALOT toolbar applications for our consumer facing innovations;
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a stronger business from which to access both debt and capital markets to support growth;
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the combination of two experienced digital marketing teams; and
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the combination will eliminate approximately $2.9 million in overlapping annual operating and public company expenses. |
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In August 2004, we acquired 100% of the outstanding stock of WebCapades, Inc.,
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In January 2005, we acquired 100% of the outstanding stock of the Market Smart Advertising companies,
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In February 2005, we acquired 100% of the stock of Personals Plus, Inc.,
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In February 2005, we also acquired 100% of the stock of Ozona Online Network, Inc.,
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In March 2005, we acquired 100% of the stock of KowaBunga! Marketing, Inc.,
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In March 2005, we acquired the assets of Smart Interactive Ltd.,
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In April 2005, we acquired 100% of the stock of PrimaryAds Inc.,
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In July 2005, we acquired 100% of the stock of Real Estate School Online, Inc.,
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In December 2005, we acquired 100% of the stock of Vintacom, Inc.,
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In January 2006, we acquired 100% of the stock of Morex Marketing Group, LLC.
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In April 2006, we acquired 100% of the stock of the Litmus Media, Inc.,
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In April 2006, we also acquired 100% of the stock of Web Diversity Ltd.,
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In May 2006, we acquired 100% of the stock iLead Media, and
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● | In March 2012, we acquired Vertro, Inc. via a merger with a wholly-owned subsidiary |
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using the combined company’s cash and other assets efficiently to develop the business of the combined company;
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appropriately managing the liabilities of the combined company;
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potential unknown or currently unquantifiable liabilities associated with the merger and the operations of the combined company;
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potential unknown and unforeseen expenses, delays or regulatory conditions associated with the merger; and
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performance shortfalls at one or both of the companies as a result of the diversion of management’s attention caused by completing the merger and integrating the companies’ operations.
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We fail to have websites and applications approved;
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Our paid listings providers' performance deteriorates; or
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We violate our paid listings providers' guidelines or they change their implementation guidelines.
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pay fees to the lender associated with the credit facility;
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maintain our corporate existence in good standing;
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grant the lender a security interest in our assets;
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provide financial information to the lender; and
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refrain from any transfer of any of our business or property (subject to customary exceptions).
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we may incur substantial costs, delays, or other operational or financial problems in integrating acquired businesses, including integrating each company’s accounting, management information, human resource, and other administrative systems to permit effective management;
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we may not be able to identify, acquire, or profitably manage any additional businesses;
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with smaller acquired companies, we may need to implement or improve controls, procedures, and policies appropriate for a public company;
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the acquired companies may adversely affect Our consolidated operating results, particularly since some of the acquired companies may have a history of operating losses;
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acquisitions may divert management’s attention from the operation of Our businesses;
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we may not be able to retain key personnel of acquired businesses;
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there may be cultural challenges associated with integrating employees from acquired companies into Our organization; and
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We may encounter unanticipated events, circumstances, or legal liabilities.
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attract new clients and maintain current client relationships;
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achieve effective advertising campaign results for our clients;
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continue to expand the number of services and technologies we offer;
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successfully implement our business model, which is evolving;
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respond to pricing pressure in some of our lines of business;
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maintain our reputation and build trust with our clients;
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identify, attract, retain and motivate qualified personnel;
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accurately measure impressions, searches, clicks, or other online actions for our advertisers, publishers, or partners;
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adapt to changes in online advertising, email, and other filtering software; and
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manage online credit card billing and customer service concerns.
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user privacy;
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trespass;
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defamation;
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database and data protection;
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limitations on the distribution of materials considered harmful to children;
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liability for misinformation provided over the web;
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user protection, pricing, taxation, and advertising restrictions (including, for example, limitation on the advertising on Internet gambling websites or of certain products);
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delivery of contextual advertisements via connected desktop software;
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intellectual property ownership and infringement, including liability for listing or linking to third-party websites that include materials infringing copyrights or other rights;
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distribution, characteristics, and quality of products and services; and
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other consumer protection laws.
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decrease the demand for our services;
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increase our cost of doing business;
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preclude us from developing additional products or services;
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result in adverse publicity to us;
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subject us to fines, litigation, or criminal penalties; or
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enjoin us from conducting our business or providing any of our services;
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our ability to attract new clients, including the length of our sales cycles, or to sell increased usage of our service to existing clients;
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technical difficulties or interruptions in our services;
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changes in privacy protection and other governmental regulations applicable to the our industry;
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changes in our pricing policies or the pricing policies of our competitors;
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the financial condition and business success of our clients;
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purchasing and budgeting cycles of our clients;
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acquisitions of businesses and products by us or our competitors;
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● | competition, including entry into the market by new competitors or new offerings by existing competitors; | |
● | discounts offered to advertisers by upstream advertising networks; | |
● | our history of litigation; | |
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our history of uncollectable receivables;
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our ability to hire, train and retain sufficient sales, client management and other personnel;
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timing of development, introduction and market acceptance of new services or service enhancements by us or our competitors;
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concentration of marketing expenses for activities such as trade shows and advertising campaigns;
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expenses related to any new or expanded data centers; and
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general economic and financial market conditions.
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actual or expected fluctuations in its operating results;
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variance in its financial performance from the expectations of market analysts;
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changes in general economic conditions or conditions in its industry generally;
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changes in conditions in the financial markets;
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announcements of significant acquisitions or contracts by Inuvo or its competitors;
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its inability to raise additional capital and maintain its exchange listing;
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changes in applicable laws or regulations, court rulings and enforcement and legal actions;
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additions or departures of key management personnel;
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actions by its stockholders;
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changes in market prices for its products; and
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changes in stock market analyst research and recommendations regarding the shares of our common stock, other comparable companies or its industry generally.
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High
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Low
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|||||||
Year Ended December 31, 2010:
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||||||||
First Quarter
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$ |
4.40
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$ |
2.70
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||||
Second Quarter
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$ |
3.00
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$ |
1.30
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||||
Third Quarter
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$ |
3.40
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$ |
1.60
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Fourth Quarter
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$ |
6.60
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$ |
2.80
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Year Ended December 31, 2011:
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||||||||
First Quarter
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$ |
5.85
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$ |
2.58
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||||
Second Quarter
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$ |
3.02
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$ |
1.65
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||||
Third Quarter
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$ |
4.49
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$ |
1.02
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Fourth Quarter
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$ |
1.94
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$ |
0.69
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●
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performance marketing, and
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●
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web properties.
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●
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diversified revenue streams which will mitigate our dependence on one major customer;
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●
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an existing install and distribution capability through Vertro’s ALOT toolbar applications for our consumer facing innovations;
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●
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a stronger business from which to access both debt and capital markets to support growth; and
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the combination of two experienced digital marketing teams.
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Year Ended December 31,
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||||||||||||||||||||||||
2011 ($)
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% of Revenue
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2010 ($)
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% of Revenue
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$ Change
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% Change
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|||||||||||||||||||
Performance marketing
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24,251 | 67.7 | % | 35,449 | 72.4 | % | (11,198 | ) | (31.6 | )% | ||||||||||||||
Web properties
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11,569 | 32.3 | % | 13,521 | 27.6 | % | (1,952 | ) | (14.4 | )% | ||||||||||||||
Total net revenue
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35,820 | 100.0 | % | 48,970 | 100.0 | % | (13,150 | ) | (26.9 | )% |
Year Ended December 31,
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||||||||||||
2011
% of Revenue
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2010
% of
Revenue
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% Change
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||||||||||
Affiliate expenses
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50.6 | % | 54.7 | % | (4.1 | )% | ||||||
Data acquisition
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7.4 | % | 4.8 | % | 2.6 | % | ||||||
Merchant processing fees and product costs
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0.2 | % | 0.2 | % | - | |||||||
Total cost of revenue
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58.2 | % | 59.7 | % | (1.5 | )% |
Year Ended December 31,
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||||||||||||||||||||||||
2011
($)
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% of Gross Profit
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2010
($)
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% of Gross Profit
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$
Change
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%
Change
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|||||||||||||||||||
Performance marketing
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6,093 | 40.7 | % | 8,563 | 43.4 | % | (2,470 | ) | (28.8 | )% | ||||||||||||||
Web properties
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8,895 | 59.3 | % | 11,152 | 56.6 | % | (2,257 | ) | (20.2 | )% | ||||||||||||||
Total gross profit
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14,988 | 100.0 | % | 19,715 | 100.0 | % | (4,727 | ) | (24.0 | )% |
Year Ended December 31,
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||||||||||||||||||||||||
2011
($)
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% of
Revenue
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2010
($)
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% of
Revenue
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$
Change
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%
Change
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|||||||||||||||||||
Search costs
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7,446 | 20.8 | % | 5,418 | 11.1 | % | 2,028 | 37.4 | % | |||||||||||||||
Compensation and telemarketing
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7,671 | 21.4 | % | 10,357 | 21.1 | % | (2,686 | ) | (25.9 | )% | ||||||||||||||
Selling, general and administrative
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5,567 | 15.5 | % | 7,628 | 15.6 | % | (2,061 | ) | (27.0 | )% | ||||||||||||||
Total operating expenses
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20,684 | 57.7 | % | 23,403 | 47.8 | % | (2,719 | ) | (11.6 | %) |
Year Ended December 31,
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||||||||||||||||||||||||
2011
($)
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% of
Revenue
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2010
($)
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% of
Revenue
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$
Change
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%
Change
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|||||||||||||||||||
Performance marketing
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2,581 | 7.2 | % | 2,533 | 5.2 | % | 48 | - | % | |||||||||||||||
Web properties
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11,464 | 32.0 | % | 10,823 | 22.1 | % | 641 | 5.9 | % | |||||||||||||||
Corporate
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6,639 | 18.5 | % | 10,047 | 20.5 | % | (3,408 | ) | (33.9 | )% |
Exhibit No. | Description of Exhibit | |
2.1
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Agreement, entered into as of August 19, 2004, by and among Registrant, WebCapades Acquisition Sub, Inc., WebCapades, Inc., Scott Mitchell and Kristine E. Mitchell (Incorporated by reference and filed as an exhibit to the Registrant’s Current Report on Form 8-K filed with the Securities and Exchange Commission on August 25, 2004.)
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2.2
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Plan of Merger by Registrant, WebCapades Acquisition Sub, Inc., and WebCapades, Inc. (Incorporated by reference and filed as an exhibit to the Registrant’s Current Report on Form 8-K filed with the Securities and Exchange Commission on August 25, 2004.)
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2.3
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Agreement and Plan of Reorganization by and among Registrant and WorldMall Acquisition Corporation, WorldMall, Inc., S. Patrick Martin and the other stockholders of WorldMall, Inc. dated as of March, 2001 (Incorporated by reference and filed as an exhibit to the Registrant’s Annual Report on Form 10-KSB filed with the Securities and Exchange Commission on March 1, 2004.)
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2.4
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Agreement and Plan of Merger dated June 5, 2009 between Inuvo, Inc. and Kowabunga! Inc. (Incorporated by reference and filed as an exhibit to the Registrant’s Current Report on Form 8-K filed with the Securities and Exchange Commission on July 24, 2009.)
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2.5
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Agreement and Plan of Merger dated October 16, 2011 between Inuvo, Inc., Anhinga Merger Subsidiary, Inc. and Vertro, Inc. (Incorporated by reference to the Registrant’s Current Report on Form 8-K as fled on October 17, 2011.)
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3(i).1
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Articles of Incorporation, as amended)Incorporated by reference and filed as an exhibit to the Registrant’s Annual Report on Form 10-KSB filed with the Securities and Exchange Commission on March 1, 2004.)
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3(i).2
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Amended to Articles of Incorporation filed March 14, 2005 (Incorporated by reference and filed as an exhibit to the Registrant’s Annual Report on Form 10-KSB filed with the Securities and Exchange Commission on March 31, 2006.)
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3(i).3
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Articles of Merger between Inuvo, Inc. and Kowabunga! Inc. (Incorporated by reference and filed as an exhibit to the Registrant’s Current Report on Form 8-K filed with the Securities and Exchange Commission on July 24, 2009.)
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3(i).4
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Certificate of Change Filed Pursuant to NRS 78.209 (Incorporated by reference to the Registrant’s Current Report on Form 8-K as filed on September 30, 2010.)
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3(i).5
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Certificate of Merger as filed with the Secretary of State of Nevada on February 29, 2012 *
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3(i).6
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Articles of Amendment to Amended Articles of Incorporation as filed on February 29, 2012 *
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3(ii).1
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Amended and Restated By-Laws (Incorporated by reference to the Registrant’s Annual Report on Form 10-K filed with the Securities and Exchange Commission on March 31, 2010.)
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3(ii).2
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Bylaw amendment adopted February 29, 2012 (Incorporated by reference to the Registrant’s Current Report on Form 8-K as filed on March 6, 2012.)
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4.1
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Form of warrant to purchase shares of Registrant for 2009 consultants.*
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4.2
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Form of warrant to purchase shares of Registrant for 2011 offering. (Incorporated by reference and filed as an exhibit to the Registrant’s Current Report on Form 8-K filed with the Securities and Exchange Commission on June 22, 2011.)
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4.3
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Rights Agreement dated February 14, 2008 (Incorporated by reference to the Current Report on Form 8-K as filed with the Securities and Exchange Commission on February 19, 2008).
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4.4
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Exchange Agent Agreement dated February 24 2012 between Inuvo, Inc. and Colonial Stock Transfer Co., Inc.*
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4.5
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Form of Amendment No. 1 to Rights Agreement (Incorporated by reference to the Registrant’s Current Report on Form 8-K as fled on October 17, 2011.)
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4.6
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Form of warrant to purchase 40,000 shares of common stock issued to Alliance Advisors, LLC *
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4.7
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Form of warrant to purchase 10,000 shares of common stock issued to Alliance Advisors, LLC *
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10.1
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2005 Long-Term Incentive Plan (Incorporated by reference to the Current Report on Form 8-K as filed on December 10, 2010.)
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10.2
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Specimen Stock Option Agreement between the Registrant and Optionees (Incorporated by reference and filed as an exhibit to the Registrant’s Current Report on Form 8-K filed with the Securities and Exchange Commission on July 1, 2008.)
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10.3
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Lease Agreement, dated August 10, 2007, by and between Lightwave Drive, LLC and Think Partnership, Inc., as amended *
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10.4
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Lease dated February 29, 2000 by and between Alot, Inc. (formerly Comet Systems, Inc.) and The Rector, Church-Wardens and Vestrymen of Trinity Church in New York, a religious corporation in the State of New York, including the previous amendment dated August 8, 2000. *
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10.5
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Lease Modification and Extension Agreement by and between Alot, Inc.(formerly known as MIVA Direct, Inc.) and The Rector, Church-Wardens and Vestrymen of Trinity Church in New York, dated February 23, 2006.*
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10.6
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Colonial Bank Plaza Office Building Lease, dated January 31, 2002, as amended.*
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10.7
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Third Amendment to Colonial Bank Plaza Office Building Lease, dated December 18, 2009.*
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10.8
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Fourth Amendment to Lease, dated March 31, 2010, between Vertro, Inc. and Mick Vorbeck, released from escrow April 13, 2010. Incorporated by reference to the exhibit previously filed on April 16, 2010 with Vertro’s Form 8-K*
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10.9
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Sublease, dated march 31, 2010, between Vertro, Inc. and MIVA AK, Inc., released from escrow April 13, 2010. Incorporated by reference to the exhibit previously filed on April 16, 2010 with Vertro’s Form 8-K.*
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10.10
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2010 Equity Compensation Plan (Incorporated by reference to the Registrant’s definitive proxy statement on Schedule 14A as filed on April 30, 2010.)
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10.11
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Asset Sale/Purchase Agreement dated September 24, 2010 by and between MarketSmart Advertising, Inc., Rightstuff, Inc., Checkup Marketing, Inc. and The Finch Agency, Inc. (Incorporated by reference to the Registrant’s Current Report on Form 8-K as filed on September 30, 2010.)
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10.12
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Asset Purchase Agreement dated December 10, 2010 by and between Real Estate School Online, Inc. and Inuvo, Inc. and DF Institute, Inc. (Incorporated by reference to the Registrant’s Current Report on Form 8-K as filed on December 13, 2010.)
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10.13
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Agreement dated June 15, 2011, executed October 20, 2011, between Inuvo, Inc. and Alliance Advisors, LLC *
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10.14
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Employment Agreement dated March 1, 2012 between Inuvo, Inc. and Richard K. Howe (Incorporated by reference to the Registrant’s Current Report on Form 8-K as filed on March 6, 2012.)
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10.15
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Employment Agreement dated March 1, 2012 between Inuvo, Inc. and Peter A. Corrao (Incorporated by reference to the Registrant’s Current Report on Form 8-K as filed on March 6, 2012.)
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10.16
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Employment Agreement dated March 1, 2012 between Inuvo, Inc. and Wallace D. Ruiz (Incorporated by reference to the Registrant’s Current Report on Form 8-K as filed on March 6, 2012.)
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10.17
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Employment Agreement dated March 1, 2012 between Inuvo, Inc. and John B. Pisaris (Incorporated by reference to the Registrant’s Current Report on Form 8-K as filed on March 6, 2012.)
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10.18
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Amendment dated February 29, 2012 to 2010 Equity Compensation Plan (Incorporated by reference to the Registrant’s Current Report on Form 8-K as filed on March 6, 2012.)
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10.19
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Business Financing Agreement, dated March 1, 2012, with Bridge Bank, National Association (Incorporated by reference to the Registrant’s Current Report on Form 8-K as filed on March 6, 2012.)
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10.20
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Intellectual Property Security Agreement, dated March 1, 2012, between Inuvo, Inc. and Bridge Bank, National Association (Incorporated by reference to the Registrant’s Current Report on Form 8-K as filed on March 6, 2012.)
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10.21
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Intellectual Property Security Agreement, dated March 1, 2012, between subsidiaries and Bridge Bank, National Association (Incorporated by reference to the Registrant’s Current Report on Form 8-K as filed on March 6, 2012.)
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10.22
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Amended and Restated Google Services Agreement dated November 10, 2008 between Vertro, Inc. (formerly known as MIVA, Inc.) and Google, Inc.*/ *
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10.23
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Google Services Agreement Order Form dated November 10, 2008 between Vertro, Inc. (formerly known as MIVA, Inc.) and Google, Inc.*/**
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10.24
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Amendment No. 1 to Google Services Agreement Order Form and Google Services Agreement. */**
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21.1
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Subsidiaries of the Registrant*
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23.1
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Consent of Mayer Hoffman McCann P.C.*
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31.1
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Rule 13a-14(a)/15d-14(a) certification of Chief Executive Officer *
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31.2
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Rule 13a-14(a)/15d-14(a) certification of Chief Financial Officer *
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32.1
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Section 1350 certification of Chief Executive Officer *
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32.2
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Section 1350 certification of Chief Financial Officer *
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Inuvo, Inc.
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Date: March 27, 2012 |
By:
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/s/ Wallace D. Ruiz
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Chief Financial Officer
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Signature
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Title
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Date
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/s/ Richard K. Howe
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Executive Chairman of the Board of Directors
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March 27, 2012
|
||
Richard K. Howe | ||||
/s/ Peter A. Corrao
|
Chief Executive Officer and director, principal executive officer
|
March 27, 2012
|
||
Peter A. Corrao | ||||
/s/ Wallace D. Ruiz
|
Chief Financial Officer, principal financial and accounting officer
|
March 27, 2012
|
||
Wallace D. Ruiz | ||||
/s/ Charles Pope
|
Director
|
March 27, 2012
|
||
Charles Pope
|
||||
/s/ Adele Goldberg
|
Director
|
March 27, 2012
|
||
Adele Goldberg
|
||||
/s/ Charles Morgan
|
Director
|
March 27, 2012
|
||
Charles Morgan
|
||||
/s/ Joseph P. Durrett | Director | March 27, 2012 | ||
Joseph P. Durrett |
CONTENTS | ||||
Report of Independent Registered Public Accounting Firm
|
F-2 | |||
Consolidated Financial Statements:
|
||||
Consolidated Balance Sheets
|
F-3 | |||
Consolidated Statements of Operations
|
F-4 | |||
Consolidated Statements of Stockholders’ (Deficit) Equity
|
F-5 | |||
Consolidated Statements of Cash Flows
|
F-6 | |||
Notes to Consolidated Financial Statements
|
F-7 |
/s/ Mayer Hoffman McCann P.C.
|
Clearwater, Florida
|
March 27, 2012
|
2011
|
2010
|
|||||||
Assets:
|
||||||||
Current assets:
|
||||||||
Cash
|
$ | 4,413 | $ | 118,561 | ||||
Restricted cash
|
475,586 | 140,493 | ||||||
Accounts receivable, net of allowance for doubtful accounts of $477,289 and $450,634, respectively
|
5,426,865 | 4,500,894 | ||||||
Unbilled revenue
|
49,196 | 59,881 | ||||||
Names database
|
947,882 | - | ||||||
Prepaid expenses and other current assets
|
433,601 | 463,958 | ||||||
Current assets of discontinued operations
|
- | 50,000 | ||||||
Total current assets
|
7,337,543 | 5,333,787 | ||||||
Property and equipment, net
|
1,590,011 | 2,749,098 | ||||||
Other assets:
|
||||||||
Goodwill
|
1,776,544 | 3,351,405 | ||||||
Intangible assets
|
390,000 | 2,511,918 | ||||||
Other assets
|
2,243 | 79,324 | ||||||
Total other assets
|
2,168,787 | 5,942,647 | ||||||
Total assets
|
$ | 11,096,341 | $ | 14,025,532 | ||||
Liabilities and Stockholders’ (Deficit)Equity:
|
||||||||
Current liabilities:
|
||||||||
Term and credit note payable – current portion
|
$ | 452,000 | $ | 1,850,000 | ||||
Accounts payable
|
6,198,921 | 5,479,796 | ||||||
Deferred revenue
|
18,083 | 19,921 | ||||||
Deferred compensation
|
929,428 | - | ||||||
Accrued expenses and other current liabilities
|
1,593,748 | 1,599,625 | ||||||
Current liabilities of discontinued operations
|
160,000 | 712,024 | ||||||
Total current liabilities
|
9,352,180 | 9,661,366 | ||||||
Long-term liabilities:
|
||||||||
Term and credit notes payable – long term
|
2,454,303 | - | ||||||
Other long-term liabilities
|
300,124 | 356,509 | ||||||
Total long-term liabilities
|
2,754,427 | 356,509 | ||||||
Stockholders’ (deficit) equity:
|
||||||||
Preferred stock, $.001 par value:
|
||||||||
Authorized shares – 500,000 – none issued or outstanding
|
- | - | ||||||
Common stock, $.001 par value:
|
||||||||
Authorized shares 20,000,000, issued shares 10,422,617 and 9,110,486, respectively
|
||||||||
Outstanding shares – 10,035,790 and 8,558,790, respectively
|
10,422 | 9,110 | ||||||
Additional paid-in capital
|
115,096,953 | 111,766,319 | ||||||
Accumulated deficit
|
(114,648,037 | ) | (105,671,666 | ) | ||||
Treasury stock, at cost – 386,827 and 551,696 shares, respectively
|
(1,469,604 | ) | (2,096,106 | ) | ||||
Total stockholders’ (deficit) equity
|
(1,010,266 | ) | 4,007,657 | |||||
Total liabilities and stockholders’ (deficit) equity
|
$ | 11,096,341 | $ | 14,025,532 |
2011
|
2010
|
|||||||
Net revenue
|
$ | 35,819,996 | $ | 48,969,847 | ||||
Cost of revenue:
|
||||||||
Affiliate expenses
|
18,130,731 | 26,817,621 | ||||||
Data acquisition
|
2,644,779 | 2,335,313 | ||||||
Merchant processing fees and product costs
|
56,249 | 102,376 | ||||||
Cost of revenue
|
20,831,759 | 29,255,310 | ||||||
Gross profit
|
14,988,237 | 19,714,537 | ||||||
Operating expenses:
|
||||||||
Search costs
|
7,446,116 | 5,418,099 | ||||||
Compensation and telemarketing
|
7,670,869 | 10,356,682 | ||||||
Selling, general and administrative
|
5,567,103 | 7,627,703 | ||||||
Total operating expenses
|
20,684,088 | 23,402,484 | ||||||
Operating loss
|
(5,695,851 | ) | (3,687,947 | ) | ||||
Other income (expense):
|
||||||||
Interest income
|
4,990 | 4,721 | ||||||
Interest expense
|
(335,870 | ) | (564,001 | ) | ||||
Litigation settlements
|
(374,800 | ) | - | |||||
Loss on sale of assets
|
(193,133 | ) | - | |||||
Impairment of assets
|
(2,630,967 | ) | (400,000 | ) | ||||
Other income
|
- | 11,843 | ||||||
Other expenses, net
|
(3,529,780 | ) | (947,437 | ) | ||||
Loss from continuing operations before taxes on income
|
(9,225,631 | ) | (4,635,384 | ) | ||||
Income tax expense
|
(7,876 | ) | (2,642 | ) | ||||
Net loss from continuing operations
|
(9,233,507 | ) | (4,638,026 | ) | ||||
Income (loss) from discontinued operations net of tax expense of $0
|
257,136 | (368,223 | ) | |||||
Net loss
|
$ | (8,976,371 | ) | $ | (5,006,249 | ) | ||
Per common share data:
|
||||||||
Basic and diluted:
|
||||||||
Loss from continuing operations
|
$ | (0.99 | ) | $ | (0.55 | ) | ||
Income (loss) from discontinued operations
|
0.03 | (0.04 | ) | |||||
Net loss
|
$ | (0.96 | ) | $ | (0.59 | ) | ||
Weighted average shares (basic and diluted)
|
9,364,038 | 8,496,284 |
Common Stock
|
Additional Paid in |
Total
Stockholders’
|
||||||||||||||||||||||
Shares
|
Stock
|
Capital
|
Accumulated Deficit
|
Treasury Stock
|
(Deficit) Equity
|
|||||||||||||||||||
Balances December 31, 2009
|
8,444,233 | $ | 8,996 | $ | 110,976,129 | $ | (100,665,417 | ) | $ | (2,096,106 | ) | $ | 8,223,602 | |||||||||||
Forfeited restricted stock units
|
(6,667 | ) | (7 | ) | 7 | - | - | - | ||||||||||||||||
Additional shares issued due to reverse stock split
|
87 | - | - | - | - | - | ||||||||||||||||||
Issuance of common stock for compensation
|
121,137 | 121 | 256,779 | - | - | 256,900 | ||||||||||||||||||
Stock based compensation
|
- | - | 533,404 | - | - | 533,404 | ||||||||||||||||||
Net loss
|
- | - | - | (5,006,249 | ) | - | (5,006,249 | ) | ||||||||||||||||
Balances December 31, 2010
|
8,558,790 | 9,110 | 111,766,319 | (105,671,666 | ) | (2,096,106 | ) | 4,007,657 | ||||||||||||||||
Forfeited restricted stock units
|
(3,000 | ) | (3 | ) | 3 | - | - | - | ||||||||||||||||
Sale of stock, net of stock issuance costs
|
1,350,000 | 1,350 | 2,634,446 | - | - | 2,635,796 | ||||||||||||||||||
Issuance of common stock for litigation settlements
|
130,000 | 130 | 365,270 | - | - | 365,400 | ||||||||||||||||||
Retirement of treasury shares
|
- | (165 | ) | (626,337 | ) | - | 626,502 | - | ||||||||||||||||
Stock based compensation
|
957,252 | 957,252 | ||||||||||||||||||||||
Net loss
|
- | - | - | (8,976,371 | ) | - | (8,976,371 | ) | ||||||||||||||||
Balances December 31, 2011
|
10,035,790 | $ | 10,422 | $ | 115,096,953 | $ | (114,648,037 | ) | $ | (1,469,604 | ) | $ | (1,010,266 | ) |
2011
|
2010
|
|||||||
Operating activities:
|
||||||||
Net loss
|
$ | (8,976,371 | ) | $ | (5,006,249 | ) | ||
Adjustments to reconcile net loss to net cash (used in) provided by operating activities:
|
||||||||
Depreciation and amortization
|
4,213,771 | 5,067,982 | ||||||
Amortization of financing fees
|
108,824 | - | ||||||
Litigation settlements in stock
|
249,800 | |||||||
Provision for doubtful accounts
|
83,020 | 491,000 | ||||||
Stock based compensation
|
1,530,487 | 790,304 | ||||||
Deferred compensation
|
356,193 | - | ||||||
Loss on sale of assets
|
193,133 | - | ||||||
Impairment of assets
|
2,630,967 | 400,000 | ||||||
Loss on sale of discontinued operations
|
- | 989,364 | ||||||
Change in operating assets and liabilities:
|
||||||||
Restricted cash
|
(335,093 | ) | 499,082 | |||||
Accounts receivable
|
(1,008,991 | ) | (320,384 | ) | ||||
Prepaid expenses and other current assets
|
38,580 | (39,247 | ) | |||||
Accounts payable
|
719,125 | 1,048,511 | ||||||
Deferred revenue
|
(1,838 | ) | (92,852 | ) | ||||
Accrued expenses and other current liabilities
|
62,581 | (90,828 | ) | |||||
Net cash (used in) provided by operating activities from continuing operations
|
(135,812 | ) | 3,736,683 | |||||
Net cash used in operating activities from discontinued operations
|
(386,424 | ) | (389,699 | ) | ||||
Net cash (used in) provided by operating activities
|
(522,236 | ) | 3,346,984 | |||||
Investing activities:
|
||||||||
Purchasing of equipment and software
|
(462,114 | ) | (659,451 | ) | ||||
Purchase of names database and exclusivity rights
|
(2,567,029 | ) | (2,444,598 | ) | ||||
Proceeds from sale of discontinued operations
|
- | 1,434,923 | ||||||
Proceeds from the sale of property and equipment
|
- | 20,018 | ||||||
Net cash used in investing activities
|
(3,029,143 | ) | (1,649,108 | ) | ||||
Financing activities:
|
||||||||
Principal payments made on term note and capital leases
|
(124,843 | ) | (3,627,443 | ) | ||||
Advances from credit note
|
7,304,756 | 40,067,000 | ||||||
Prepaid financing fees
|
(130,025 | ) | - | |||||
Payments on credit note
|
(6,248,453 | ) | (42,862,000 | ) | ||||
Proceeds from issuance of common stock, net of costs
|
2,635,796 | - | ||||||
Net cash provided by (used in) financing activities
|
3,437,231 | (6,422,443 | ) | |||||
Net decrease in cash
|
(114,148 | ) | (4,724,567 | ) | ||||
Cash, beginning of year
|
118,561 | 4,843,128 | ||||||
Cash, end of year
|
$ | 4,413 | $ | 118,561 | ||||
Supplemental information:
|
||||||||
Interest paid
|
$ | 236,783 | $ | 548,371 | ||||
Income taxes paid, net
|
$ | 7,876 | $ | 2,642 | ||||
Non-cash investing activities:
|
||||||||
Equipment under capital leases
|
$ | - | $ | 19,236 | ||||
Sale of assets through note receivable
|
$ | - | $ | 140,472 |
●
|
Performance marketing, and
|
●
|
Web properties.
|
|
●
|
diversified revenue streams which will mitigate our dependence on one major customer;
|
|
●
|
an existing install and distribution capability through Vertro’s ALOT toolbar applications for our consumer facing innovations;
|
|
●
|
a stronger business from which to access both debt and capital markets to support growth; and
|
|
●
|
the combination of two experienced digital marketing teams.
|
Level 1
|
Quoted prices in active markets for identical assets or liabilities.
|
Level 2
|
Observable inputs other than quoted prices included in Level 1, such as quoted prices for similar assets and liabilities in active markets; quoted price for identical or similar assets and liabilities in markets that are not active; or other input that are observable or can be corroborated by observable market data.
|
Level 3
|
Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. This includes certain pricing models, discounted cash flow methodologies and similar techniques that use significant unobservable inputs.
|
2011
|
2010
|
|||||||
Balance at the beginning of the year
|
$ | 450,634 | $ | 1,344,648 | ||||
Provision for bad debts
|
83,020 | 491,000 | ||||||
Charge-offs
|
(132,753 | ) | (1,385,014 | ) | ||||
Recoveries
|
76,388 | - | ||||||
Balance at the end of the year
|
$ | 477,289 | $ | 450,634 |
2011
|
2010
|
|||||||
Furniture and fixtures
|
$ | 427,121 | $ | 427,121 | ||||
Equipment
|
2,005,505 | 3,078,393 | ||||||
Software
|
5,469,804 | 5,514,375 | ||||||
Leasehold improvements
|
310,416 | 321,873 | ||||||
Subtotal
|
8,212,846 | 9,341,762 | ||||||
Less: accumulated depreciation and amortization
|
(6,622,835 | ) | (6,592,664 | ) | ||||
Total
|
$ | 1,590,011 | $ | 2,749,098 |
Term
|
Carrying
Value
|
Accumulated Amortization and Impairment
|
Net Carrying Value
|
||||||||||
Names database (1)
|
9 months
|
$ | 16,130,086 | $ | (15,182,204 | ) | $ | 947,882 | |||||
Website development
|
5 Years
|
4,210,000 | (4,210,000 | ) | - | ||||||||
Customer lists
|
5 Years
|
3,500,000 | (3,500,000 | ) | - | ||||||||
Exclusivity agreement
|
1 Year
|
150,000 | (150,000 | ) | - | ||||||||
Tradenames (1)
|
Indefinite
|
390,000 | - | 390,000 | |||||||||
Total intangible assets
|
$ | 24,380,086 | $ | (23,042,204 | ) | $ | 1,337,882 | ||||||
Goodwill
|
$ | 3,893,405 | $ | (2,116,861 | ) | $ | 1,776,544 |
Term
|
Carrying
Value
|
Accumulated Amortization and Impairment
|
Net Carrying Value
|
||||||||||
Names database (1)
|
1-2 Years
|
$ | 13,563,058 | $ | (11,600,097 | ) | $ | 1,962,961 | |||||
Website development
|
5 Years
|
4,210,000 | (4,110,729 | ) | 99,271 | ||||||||
Customer lists
|
5 Years
|
3,500,000 | (3,477,814 | ) | 22,186 | ||||||||
Exclusivity agreement
|
1 Year
|
150,000 | (112,500 | ) | 37,500 | ||||||||
Tradenames (1)
|
Indefinite
|
390,000 | - | 390,000 | |||||||||
Total intangible assets
|
$ | 21,813,058 | $ | (19,301,140 | ) | $ | 2,511,918 | ||||||
Goodwill
|
$ | 3,893,405 | $ | (542,000 | ) | $ | 3,351,405 |
(1)
|
Amortization of Names Database included in cost of revenue for the years ended December 31, 2011 and 2010 was approximately $2.5 million and $2.0 million, respectively. As of January 1, 2012, the names database will be amortized over nine months due to the change in our estimate of useful life. The change in estimate resulted in the names database being classified as current in the 2011 consolidated balance sheet. Per ASC 250, Accounting Changes and Error Corrections, this change in estimate does not require a restatement in amounts in prior periods and will only change classifications prospectively. We do not amortize the carrying value of our Tradenames.
|
2012
|
$ | 947,882 | ||
2013
|
- | |||
2014
|
- | |||
2015
|
- | |||
2016
|
- | |||
Total
|
$ | 947,882 |
Lender
|
Due Date
|
Interest Rate
|
2011
|
2010
|
||||||||
Bridge Bank – term note
|
February 2013
|
Prime + 2 percentage points
|
$ | 475,000 | $ | - | ||||||
Bridge Bank – credit facility
|
February 2013
|
Prime + 2 percentage points
|
2,431,303 | - | ||||||||
Wachovia Bank – credit note
|
March 2011
|
LIBOR + 7%
|
- | 1,850,000 | ||||||||
Totals
|
2,906,303 | 1,850,000 | ||||||||||
Less: Term and credit facility payable – current portion
|
(452,000 | ) | (1,850,000 | ) | ||||||||
Term and credit facility – long-term | $ | 2,454,303 | $ | - |
2012
|
$ | 452,000 | ||
2013
|
1,333,333 | |||
2014
|
1,120,970 | |||
Total
|
$ | 2,906,303 |
2011
|
2010
|
|||||||
Accrued expenses
|
$ | 1,401,521 | $ | 748,515 | ||||
Accrued search costs
|
109,706 | 697,510 | ||||||
Accrued affiliate expenses
|
16,570 | 11,949 | ||||||
Accrued payroll liabilities
|
8,370 | 13,927 | ||||||
Capital lease – current portion
|
57,581 | 127,724 | ||||||
Total
|
$ | 1,593,748 | $ | 1,599,625 |
2011
|
2010
|
|||||||
Capital lease – net of current portion
|
$ | 16,655 | $ | 71,356 | ||||
Deferred rent
|
283,469 | 285,153 | ||||||
Total
|
$ | 300,124 | $ | 356,509 |
2011
|
2010
|
|||||||
Current tax provision
|
$ | - | $ | - | ||||
Deferred tax (benefit) provision
|
- | - | ||||||
Total tax (benefit) provision
|
$ | - | $ | - |
2011
|
2010
|
|||||||
Expected statutory rate
|
(34 | )% | (34 | )% | ||||
State income tax rate, net of federal benefit
|
(4 | )% | (4 | )% | ||||
Permanent differences
|
2 | % | 4 | % | ||||
Valuation allowance
|
36 | % | 34 | % | ||||
- | - |
2011
|
2010
|
|||||||
Deferred tax assets:
|
||||||||
Net operating loss carry forward
|
$ | 8,331,000 | $ | 5,871,000 | ||||
Intangible assets
|
5,499,000 | 4,984,000 | ||||||
Deferred rent
|
177,000 | 381,000 | ||||||
Depreciation
|
299,000 | 272,000 | ||||||
Allowance for doubtful accounts
|
257,000 | 406,000 | ||||||
Accrued expense
|
257,000 | - | ||||||
Stock based expenses
|
942,000 | 324,000 | ||||||
Other
|
220,000 | 214,000 | ||||||
Subtotal
|
15,982,000 | 12,452,000 | ||||||
Less valuation allowance
|
(15,982,000 | ) | (12,452,000 | ) | ||||
Total
|
- | - | ||||||
Less: current portion
|
- | - | ||||||
Non-current portion
|
- | - | ||||||
Deferred tax liabilities:
|
||||||||
Depreciation
|
- | - | ||||||
Intangibles
|
- | - | ||||||
Total
|
- | - | ||||||
Less: current portion
|
- | - | ||||||
Non-current portion
|
- | - | ||||||
Total deferred tax assets (liabilities)
|
- | - |
Stock Options
|
RSA's
|
Available Shares
|
Total
|
|||||||||||||
2010 ECP
|
667,705 | 109,796 | 8,087 | 785,588 | ||||||||||||
2005 LTIP
|
691,012 | 216,754 | 92,234 | 1,000,000 | ||||||||||||
Total
|
1,358,717 | 326,550 | 100,321 | 1,785,588 |
2011
|
2010
|
|||||||||||||||
Options
|
Weighted Average Exercise Price
|
Options
|
Weighted Average Exercise Price
|
|||||||||||||
Outstanding, beginning of year
|
1,223,159 | $ | 3.74 | 987,963 | $ | 5.70 | ||||||||||
Granted
|
340,000 | $ | 2.83 | 527,238 | $ | 2.46 | ||||||||||
Forfeited or expired
|
(204,442 | ) | $ | 6.61 | (292,042 | ) | $ | 4.47 | ||||||||
Exercised
|
- | $ | - | - | $ | - | ||||||||||
Outstanding, end of year
|
1,358,717 | $ | 2.81 | 1,223,159 | $ | 3.74 | ||||||||||
Exercisable, end of year
|
629,043 | $ | 3.03 | 372,663 | $ | 6.94 |
Range of
Exercise Price
|
Shares
|
Weighted Average Remaining
Contractual Life ( Years)
|
Weighted Average
Exercise Price
|
|||||||||||
$ | 1.70 – $3.00 | 1,280,467 | 8.10 | $ | 2.57 | |||||||||
$ | 3.01 - $9.99 | 78,250 | 6.47 | 6.75 | ||||||||||
$ | 10.00 - $25.00 | - | - | - | ||||||||||
$ | 25.01 - $53.00 | - | - | - | ||||||||||
Total
|
1,358,717 | 8.00 | $ | 2.81 |
2011
|
2010
|
|||||||
Expected life (in years)
|
4.90 | 5.00 | ||||||
Volatility
|
163.4 | % | 164.0 | % | ||||
Risk free interest rate
|
1.96 | % | 1.82 | % | ||||
Dividend yield
|
0.00 | % | 0.00 | % |
Range of
Exercise Price
|
Shares
|
Weighted Average Remaining
Contractual Life (Years)
|
Weighted Average
Exercise Price
|
|||||||||||
$ | 1.50 - $15.00 | 765,000 | 4.38 | $ | 2.47 | |||||||||
$ | 15.01 - $32.80 | 2,000 | 0.07 | 32.80 | ||||||||||
Total
|
767,000 | 4.38 | $ | 2.55 | ||||||||||
Exercisable
|
767,000 | 4.38 | $ | 2.55 |
Years Ended
|
||||||||
2011
|
2010
|
|||||||
Revenue
|
$ | - | $ | 7,805,231 | ||||
Income from discontinued operations before loss on sale
|
257,136 | 621,140 | ||||||
Loss on sale of discontinued operations
|
- | (989,364 | ) | |||||
Income (loss) from discontinued operations
|
$ | 257,136 | $ | (368,224 | ) |
2012
|
|
$
|
850,960
|
|
2013
|
|
880,271
|
||
2014
|
|
905,143
|
||
2015
|
|
692,422
|
||
2016
|
|
-
|
||
Thereafter
|
|
-
|
2011
|
2010
|
|||||||||||||||
Segment:
|
Amount
|
Percent
|
Amount
|
Percent
|
||||||||||||
Performance marketing
|
$ | 24,251,457 | 67.7 | % | $ | 35,449,250 | 72.4 | % | ||||||||
Web properties
|
11,568,539 | 32.3 | % | 13,520,597 | 27.6 | % | ||||||||||
Total
|
$ | 35,819,996 | 100.0 | % | $ | 48,969,847 | 100.0 | % |
Segment:
|
2011
|
2010
|
||||||
Performance marketing
|
$ | 6,092,315 | $ | 8,562,958 | ||||
Web properties
|
8,895,922 | 11,151,579 | ||||||
Total
|
$ | 14,988,237 | $ | 19,714,537 |
Segment:
|
2011
|
2010
|
||||||
Performance marketing
|
$ | 3,511,387 | $ | 6,443,806 | ||||
Web properties
|
(42,609 | ) | 2,764,050 | |||||
Corporate
|
(3,738,504 | ) | (7,026,433 | ) | ||||
Total
|
$ | (269,726 | ) | $ | 2,181,423 |
Date of Issuance: As of August 1, 2009
|
Warrant to Purchase an Aggregate of 400,000 shares of Common Stock
|
Name of Assignee
|
Address of Assignee
|
Number of Shares of Common Stock
|
·
|
$35 per certificate exchanged, and
|
·
|
printing and mailing costs as quoted
|
66 EXCHANGE PLACE, SUITE 100
SALT LAKE CITY, UTAH 84111
|
DESCRIPTION OF SHARES SURRENDERED (Please fill in. Attach separate schedule if needed)
|
||
Name(s) and Address of Registered Holder(s)
If there is any error in the name or address shown below, please make the necessary corrections
|
Certificate No(s)
|
Number of Shares
|
TOTAL SHARES F
|
FOR TELEPHONE ASSISTANCE PLEASE CALL: Toll Free (877) 285-8605 or (801) 355-5740
|
If your certificate(s) have been lost, stolen, misplaced or mutilated contact Colonial Stock Transfer at 801-355-5740.
|
||||
SPECIAL ISSUANCE INSTRUCTIONS
|
SPECIAL DELIVERY INSTRUCTIONS
|
|||
Complete ONLY if the Inuvo shares are to be issued in a name which differs from the name on the surrendered certificate(s) representing Vertro shares. Issue to:
Name: ____________________________________________
Address: ____________________________________________
____________________________________________
(Please also complete Substitute Form W-9 on the reverse AND see instructions regarding signature guarantee. See Instructions 3 ,4 and 6)
|
Complete ONLY if the Inuvo shares are to be mailed to some address other than the address reflected above. Mail to:
Name: _______________________________________
Address: _______________________________________
_______________________________________
|
|||
YOU MUST SIGN IN THE BOX BELOW.
|
Also:
|
Sign and provide your tax ID number on the back of this form
|
||
SIGNATURE(S) REQUIRED
Signature(s) of Registered Holder(s) or Agent
|
SIGNATURE(S) GUARANTEED (IF REQUIRED)
See Instruction 3.
|
|||
Must be signed by the registered holder(s) EXACTLY as name(s) appear(s) on stock certificate(s). If signature is by a trustee, executor, administrator, guardian, attorney-in-fact, officer for a corporation acting in a fiduciary or representative capacity, or other person, please set forth full title. See Instructions 2, 3, or 4.
___________________________________________________
Registered Holder
___________________________________________________
Registered Holder
___________________________________________________
Title, if any
Date: _________________ Phone No.: ___________________
|
Unless the shares are tendered by the registered holder(s) of the common stock, or for the account of a member of a “Signature Guarantee Program” (“STAMP”), Stock Exchange Medallion Program (“SEMP”) or New York Stock Exchange Medallion Signature Program (“MSP”) (an “Eligible Institution”), the above signature(s) must be guaranteed by an Eligible Institution. See Instruction 3.
______________________________________________
Authorized Signature
______________________________________________
Name of Firm
______________________________________________
Address of Firm - Please Print
|
SUBSTITUTE Form W-9
Department of the Treasury
Internal Revenue Service
|
Part I - PLEASE PROVIDE YOUR TIN AND TAXPAYER NAME IN THE SPACE AT THE RIGHT AND CERTIFY BY SIGNING AND DATING BELOW
|
Social Security No. or Employer Identification No.
Taxpayer Name
|
||
Payer’s Request for Taxpayer
Identification Number (TIN)
|
Part II - For Payees exempt from backup withholding, see the enclosed Guidelines For Certification of Taxpayers Identification Number on Substitute Form W-9 and complete as instructed therein.
|
Part III
Awaiting TIN : ¨
|
||
Certification - Under penalties of perjury, I certify that: (1) The number shown on this form is my correct Taxpayer Identification Number (or I am waiting for a number to be issued to me), and (2) I am not subject to backup withholding either because I have not been notified by the Internal Revenue Service (IRS) that I am subject to backup withholding as a result of a failure to report all interest or dividends, or the IRS has notified me that I am no longer subject to backup withholding, and (3) I am a U.S. person (including a U.S. resident alien).
Certification Instructions - You must cross out item (2) above if you have been notified by the IRS that you are subject to backup withholding because of underreporting interest or dividends on your tax return. However, if after being notified by the IRS that you were subject to backup withholding, you received another notification from the IRS that you were no longer subject to backup withholding, do not cross out item (2).
|
||||
PLEASE SIGN HERE F
|
Signature ________________________________________________ Date _________________
|
Date of Issuance: As of October 14, 2011
|
Warrant to Purchase an Aggregate of 40,000 shares of Common Stock
|
|
(A) = the volume weighted average price (“VWAP”) on the Trading Day immediately preceding the date on which Holder elects to exercise this Warrant by means of a “cashless exercise,” as set forth in the applicable Notice of Exercise;
|
|
(B) = the Exercise Price of this Warrant, as adjusted hereunder; and
|
|
(X) = the number of shares of Common Stock that would be issuable upon exercise of this Warrant in accordance with the terms of this Warrant if such exercise were by means of a cash exercise rather than a cashless exercise.
|
If to the Corporation: | 15550 Lightwave Drive | |
Suite 300 | ||
Clearwater, FL 33760 | ||
Attention: Wallace D. Ruiz, Chief Financial Officer | ||
If to the Holder: | to the address set forth in the Agreement |
INUVO, INC. | |||
|
By:
|
||
Wallace D. Ruiz, Chief Financial Officer | |||
ATTEST: | |||
________________________
|
To: | Dated: |
Name of Assignee
|
Address of Assignee
|
Number of Shares of Common Stock
|
Dated: | ||||
(Signature of Holder) | ||||
(Print or type name) |
Dated: | ||||
(Signature of Assignee) | ||||
(Print or type name) |
Date of Issuance: As of December 15, 2011
|
Warrant to Purchase an Aggregate of 10,000 shares of Common Stock
|
|
(A) = the volume weighted average price (“VWAP”) on the Trading Day immediately preceding the date on which Holder elects to exercise this Warrant by means of a “cashless exercise,” as set forth in the applicable Notice of Exercise;
|
|
(B) = the Exercise Price of this Warrant, as adjusted hereunder; and
|
|
(X) = the number of shares of Common Stock that would be issuable upon exercise of this Warrant in accordance with the terms of this Warrant if such exercise were by means of a cash exercise rather than a cashless exercise.
|
If to the Corporation: | 15550 Lightwave Drive | |
Suite 300 | ||
Clearwater, FL 33760 | ||
Attention: Wallace D. Ruiz, Chief Financial Officer | ||
If to the Holder: | to the address set forth in the Agreement |
INUVO, INC. | |||
|
By:
|
||
Wallace D. Ruiz, Chief Financial Officer | |||
ATTEST: | |||
________________________ |
To: | Dated: |
(Signature) | ||
(Print or type name) | ||
(Address) |
Name of Assignee
|
Address of Assignee
|
Number of Shares of Common Stock
|
Dated: | ||||
(Signature of Holder) | ||||
(Print or type name) |
Dated: | ||||
(Signature of Assignee) | ||||
(Print or type name) |
ARTICLE ONE
|
TERM;RENT;FREE RENT
|
(1 | ) | ||
ARTICLE TWO
|
USE
|
(3 | ) | ||
ARTICLE THREE
|
REPAIRS;NOISE;AND VIBRATION
|
(3 | ) | ||
ARTICLE FOUR
|
ALTERATIONS AND FIXTURES
|
(4 | ) | ||
ARTICLE FIVE
|
COMPLIANCE WITH GOVERNMENTAL RULES AND REGULATIONS
|
(6 | ) | ||
ARTICLE SIX
|
RULES AND REGULATIONS
|
(7 | ) | ||
ARTICLE SEVEN
|
PLATE GLASS
|
(7 | ) | ||
ARTICLE EIGHT
|
CARE OF SIDEWALKS
|
(7 | ) | ||
ARTICLE NINE
|
LANDLORD’S ACCESS TO THE PREMISES
|
(8 | ) | ||
ARTICLE TEN
|
ELECTRIC CURRENT, LIVE STEAM
|
(8 | ) | ||
ARTICLE ELEVEN
|
CONDEMNATION AND DEMOLITION
|
(10 | ) | ||
ARTICLE TWELVE
|
MECHANIC’S LIENS
|
(11 | ) | ||
ARTICLE THIRTEEN
|
SUBORDINATION
|
(11 | ) | ||
ARTICLE FOURTEEN
|
CERTIFICATE OF OCCUPANCY
|
(12 | ) | ||
ARTICLE FIFTEEN
|
INTENTIONALLY OMITTED
|
(12 | ) | ||
ARTICLE SIXTEEN
|
FIRE AND OTHER CASUALTY
|
(13 | ) | ||
ARTICLE SEVENTEEN
|
CHANGE IN USE OF PREMISES, SUBLETTING AND ASSIGNMENT
|
(14 | ) | ||
ARTICLE EIGHTEEN
|
WAIVER AND SURRENDER; REMEDIES CUMULATIVE
|
(18 | ) |
ARTICLE NINETEEN
|
NO REPRESENTATIONS AS TO PREMISES, CERTIFICATE OF OCCUPANCY AND USE
|
(19 | ) | ||
ARTICLE TWENTY
|
LIMITATION OF LANDLORD’S LIABILITY
|
(19 | ) | ||
ARTICLE TWENTY-ONE
|
INDEMNITY BY TENANT
|
(21 | ) | ||
ARTICLE TWENTY-TWO
|
NOTICES
|
(21 | ) | ||
ARTICLE TWENTY-THREE
|
INSOLVENCY
|
(22 | ) | ||
ARTICLE TWENTY-FOUR
|
REMEDIES OF THE LANDLORD ON DEFAULT IN PERFORMANCE BY THE TENANT
|
(23 | ) | ||
ARTICLE TWENTY-FIVE
|
DEFAULT
|
(23 | ) | ||
ARTICLE TWENTY-SIX
|
REMEDIES AND DAMAGES
|
(25 | ) | ||
ARTICLE TWENTY-SEVEN
|
SURRENDER AT EXPIRATION
|
(26 | ) | ||
ARTICLE TWENTY-EIGHT
|
QUIET ENJOYMENT
|
(27 | ) | ||
ARTICLE TWENTY-NINE
|
SECURITY DEPOSIT
|
(27 | ) | ||
ARTICLE THIRTY
|
REAL ESTATE TAX AND CPI ESCALATION
|
(29 | ) | ||
ARTICLE THIRTY-ONE
|
SERVICES
|
(32 | ) | ||
ARTICLE THIRTY-TWO
|
INSURANCE
|
(33 | ) | ||
ARTICLE THIRTY-THREE
|
INTENTIONALLY OMITTED
|
(34 | ) | ||
ARTICLE THIRTY-FOUR
|
WORK TO BE DONE BY LANDLORD
|
(34 | ) | ||
ARTICLE THIRTY-FIVE
|
CONSENT TO JURISDICTION
|
(34 | ) | ||
ARTICLE THIRTY-SIX
|
TENANT LIABILITY
|
(34 | ) |
ARTICLE THIRTY-SEVEN
|
ADJACENT EXCAVATION-SHORING
|
(35 | ) | ||
ARTICLE THIRTY-EIGHT
|
FAILURE TO GIVE POSSESSION
|
(35 | ) | ||
ARTICLE THIRTY-NINE
|
BROKER
|
(35 | ) | ||
ARTICLE FORTY
|
RENT RESTRICTIONS
|
(36 | ) | ||
ARTICLE FORTY-ONE
|
CERTIFICATES BY TENANT
|
(36 | ) | ||
ARTICLE FORTY-TWO
|
RESTRICTIONS ON TENANT’S USE
|
(36 | ) | ||
ARTICLE FORTY-THREE
|
HAZARDOUS MATERIALS
|
(37 | ) | ||
ARTICLE FORTY-FOUR
|
MISCELLANEOUS
|
(37 | ) | ||
ARTICLE FORTY-FIVE
|
CONSTRUCTION OF OFFICE IMPROVEMENTS
|
(37 | ) | ||
ARTICLE FORTY-SIX
|
EXISTING LEASE
|
(39 | ) |
SCHEDULE A –
|
RULES AND REGULATIONS
|
EXHIBIT A –
|
FLOOR PLANS
|
A-1 –
|
FIRST FLOOR
|
A-2 –
|
SECOND FLOOR
|
EXHIBIT B –
|
CERTIFICATE OF OCCUPANCY
|
EXHIBIT C –
|
WORK LETTER
|
(a)
|
The term shall commence at noon, Standard Time, on the date set forth above (the “Commencement Date”), and shall expire at noon, Standard Time, on the last day of the month in which the seventh anniversary of the Commencement Date occurs (or until such term shall sooner cease and expire or be terminated as hereinafter provided) (the “Expiration Date”), at an annual rent (the “fixed rent”) of:
|
(i.)
|
During the period commencing on the Commencement Date and ending on three months and fifteen days after the Commencement Date, the annual rent shall be Three Hundred Thirty Seven Thousand Two Hundred Sixty and 00/100 Dollars ($337,260.00), payable in equal monthly installments of Twenty Eight Thousand One Hundred Five and 00/100 Dollars ($28,105.00).
|
|
(ii.)
|
During the period commencing three months and sixteen days after the Commencement Date and ending on the day immediately preceding the first anniversary of the Commencement Date, the annual rent shall be Six Hundred Eighty Three Thousand Seven Hundred Sixty and 00/100 Dollars ($683,760.00) payable in equal monthly installments of Fifty Six Thousand Nine Hundred Eighty and 00/100 Dollars ($56,980.00).
|
|
(iii.)
|
During the period commencing on the first anniversary of the Commencement Date and ending on the day immediately preceding the second anniversary of the Commencement Date, the annual rent shall be Seven Hundred Eight Thousand One Hundred Eighty and 00/100 Dollars ($59,015.00).
|
|
(iv.)
|
During the period commencing on the second anniversary of the Commencement Date and ending on the day immediately preceding the fourth anniversary of the Commencement Date, the annual rent shall be Seven Hundred Fifty Seven Thousand Twenty and 00/100 Dollars ($757,020.00), payable in equal monthly installments of Sixty Three Thousand Eighty Five and 00/100 Dollars ($63,085.00);
|
|
(v.)
|
During the period commencing on the fourth anniversary of the Commencement Date and ending on the day immediately preceding the fifth anniversary of the Commencement Date, the annual rent shall be Seven Hundred Eighty One Thousand Four Hundred Forty and 00/100 Dollars ($781,440.00), payable in equal monthly installments of Sixty Five Thousand One Hundred Twenty and 00/100 Dollars ($65,120.00); and
|
|
(vi.)
|
During the period commencing on the fifth anniversary of the Commencement Date and ending on the Expiration Date, the annual rent shall be Eight Hundred Five Thousand Eight Hundred Sixty and 00/100 ($805,860.00), payable in equal monthly installments of Sixty Seven Thousand One Hundred Fifty Five and 00/100 Dollars ($67,155.00).
|
(b)
|
Fixed rent shall be payable in advance on the first day of each month during the term of this lease at the offices of the Landlord or at such other place as the Landlord may designate. The Tenant shall pay the fixed rent without demand therefore and without any set-off, deduction, abatement or offset whatsoever. If the Commencement Date occurs on a day other than the first day of a calendar month, the fixed rent for such calendar month shall be pro-rated based on the number of days in the month. All rent payments shall be paid in lawful money of the United States of America, which shall be legal tender in payment of any debts and dues, public and private, at the time of payment by good and sufficient check subject to collection and drawn on a New York City bank or trust company which is a member of the New York Clearinghouse Association.
|
(c)
|
All Sums and charges other than fixed rent rude and payable by the tenant pursuant to this lease, including, without limitation, charges for electricity (as defined in Article TEN), escalation charges (as defined in Article THIRTY) and late charges assessed pursuant to this lease are called “additional rent”. All regularly recurring items of additional rent, including, without limitation, escalation charges which are payable on a monthly basis pursuant to the provisions of Article THIRTY, shall be due and payable together with the fixed rent on the first day of each month during the term of this lease. All other items of additional rent shall be paid to the landlord within ten days after delivery of a notice or demand therefore, unless otherwise set forth herein. Fixed rent and additional rent are collectively referred to herein as “rent”. The failure of the Tenant to make any payment of additional rent shall entitle the Landlord to exercise all of the rights and remedies provided herein for the non-payment of fixed rent.
|
(d)
|
If at the Commencement Date, the Tenant is in default in the payment of rent to the landlord pursuant to the terms of any other or any prior lease with the Landlord, or with a predecessor in interest of the Landlord, The Landlord may, at its option and without notice thereof to the Tenant, add the amount of such arrears to any monthly installments of rent due under this lease and the same shall be payable to the Landlord as additional rent.
|
(e)
|
If any installment of rent shall not be paid within seven (7) days following the date on which the same shall be due and payable pursuant to this lease then, in addition to, and without waiving or releasing any other rights and remedies of the Landlord, the tenant shall pay to the Landlord a late charge of one (1%) percent per month computed (on the basis of a 30-day month) from the date on which each such installment became due and payable to the date of payment of the installment on the amount of each such installment or installments, as liquidated damages for the Tenant’s failure to make prompt payment, and the same may be collected on demand.
|
(f)
|
In the event any checked issued by the Tenant is dishonored for any reason, the Tenant shall submit a replacement check within three (3) days following notice from the landlord that the check was dishonored. Tenant’s failure to submit a replacement check within such time period shall constitute an event of default under this lease.
|
(g)
|
Notwithstanding the foregoing, provided no Event of Default shall have occurred, which Event of Default results in the commencement of a non payment or holdover summary proceeding in which the Landlord prevails, the Tenant shall be relieved of the obligations to pay the monthly installment of fixed rent as follows.
|
(i) |
for the two month period commencing on the first day of the twelfth month after the commencement Date and ending on the last day of the thirteenth month after the Commencement Date; and
|
(ii) |
for the one-month period commencing on the first day of the twenty-fifth month after the commencement Date, and
|
(iii) |
for the one month period commencing on the first day of the twenty-eighth month after the Commencement Date, and
|
(iv) |
for the one month period commencing on the first day of the thirty-first month after the Commencement Date, and
|
(v) |
for the one month period commencing on the first day of the thirty seventh month after the commencement, and
|
(vi) |
the Tenant shall receive an abatement in fixed rent in the amount of $ 26,812.50 during the forty third month of the tern of this lease.
|
The Tenant shall during such abatement period pay all other amounts due under this lease, including but not limited to any additional rent payable pursuant to Article THIRTY of this lease and any service charges for electric current or water, if applicable. Upon the occurrence of an Event of Default, which as aforesaid, results in the commencement of a non payment or holdover summary proceeding in which the Landlord prevails, the fixed rent at the monthly rate set forth in this lease shall be payable during the period in which the Tenant would otherwise be entitled to the use of the premises free of fixed rent. Any such rent payment shall be paid within five days after the demand therefore and shall constitute addition rent under this lease.
|
(a)
|
The Tenant shall use the premises only for general and executive offices, and computer programming in connection with the Tenant’s software development business and, subject to the Certificate of Occupancy for the building and compliance by the Tenant with all applicable laws, rules and regulations, the following uses, provided they are incidental and ancillary to the use of premises by the Tenant as offices: (i) panty and lunchroom use for the reheating (but not cooking ) and consumption of food and beverages, including the sale of food and beverages by vending machines, (ii) installation and operation of electronic date word processing , reproducing equipment, telecopier, telex, and similar type equipment, each of the foregoing ancillary uses being exclusively for the use of Tenant’s employees, staff, and business visitors, and not for the general public.
|
(b)
|
If any portion of the premises consists of basement space, such portion shall be used only for storage purposes.
|
(a)
|
The Tenant shall take good care of the premises and the fixtures, appurtenances, equipment and facilities therein and shall make, as and when needed, all repairs to be equal in quality to the original work provided that the Tenant shall not be obligated for structural or exterior repairs to the building or for repairs to the systems and facilities of the building, other than fixtures, appurtenances, equipments and facilities in the premises, except where structural or exterior repairs or repairs to such systems and facilities are made necessary by reason of one or more of the occurrences described below in clauses (i) through (iv) of this Article THREE (a). All repairs for which the Tenant is responsible pursuant to this Article shall be made by a contractor reasonably approved by the Landlord. Should the Tenant fail to repair promptly after notice from the Landlord any condition in or about the premise or the fixtures, appurtenances, equipment and facilities there in which is of such a nature that its neglect would result n damage or danger to the building, it’s fixtures, appurtenances, facilities, and equipment, or to its occupants (of which Landlords’ judgment shall be conclusive) or, in the case of repairs of any other nature, should the Tenant have failed to make the repairs required to be made by the tenant hereunder or to have begun in good faith, the work necessary to make them within fifteen days after notice from the Landlord of the condition requiring repair, the Landlord may, in either such case, immediately enter the premises and make the required repairs at the reasonable expense of the tenant. The Landlord may make, at the expense of the tenant, any repairs to the building or to its fixtures, appurtenances, facilities or equipment, whether of a structural or any other nature, which are required by reason of damage or injury due (i) to the negligence or the willful acts of the Tenant or its employees, agents, licenses or visitors: (ii) to the moving into or out of the building, of property being delivered to the Tenant or taken from the premises by or on behalf of the tenant; (iii) to the installation, repair or removal, use or operation of the property of the Tenant in the premises; or (iv) to the faulty operation of any machinery, equipment or facility installed in the premises by or for the Tenant. The Tenant will pay the reasonable out of pocket cost of any repairs made by the Landlord may, at its option, add such amounts to any installment or installments of rent due under this lease and collect the same as additional rent. The liability of the Tenant under this Article THREE shall survive the expiration or other termination of this lease.
|
(b)
|
Except to the extent hereinabove set forth, and subject to the provisions of Article Sixteen, the Landlord shall maintain in working order and repair the rood and exterior of the building (including without limitation the exterior of the windows, including latches, hinges and glazing) and the public portions of the building interior and the building plumbing, electrical and heating systems serving the premises, it being agreed that the Landlord shall not be obligated to install such systems to the extent they do not presently exist in the building. The Tenant shall be obligated at its sole cost and expense, to maintain during the term of this lease a full service contract with a reputable air-conditioning maintenance company for the maintenance and repair of the air conditioning system serving the premises (both the form of contract and company to be subject to the Landlord’s prior approval) The Tenant shall give prompt notice of any defective condition in the premises for which the Landlord may be responsible hereunder. There shall be no allowance to the Tenant for diminution in rental value and no liability on the part of the Landlord or others making repairs, alterations, additions, or improvements in or to any portion of the building or the premises or in and to the fixtures, appurtenances or equipments thereof. It is specifically agreed that the Tenant shall not be entitled to any set off or reduction of rent by reason of any failure of the Landlord to comply with the provisions of this or any other Article of the lease.
|
(c)
|
Tenant shall not install or maintain equipment, machinery or manufacturing equipment of any description in the premises, the operation of which produces noise or vibration which is transmitted beyond the premises. If the tenant does install such equipment or machinery and the Landlord deems it necessary that the noise or vibration of such machinery or equipment be diminished, eliminated, prevented or confined to the premises, the Landlord may, at its election, give written notice to the Tenant, requiring either (i) that the Tenant immediately remove said equipment from the premises or (ii) that the Tenant provide and install rubber or other approved settings for absorbing, preventing or decreasing the noise or vibration of such machinery or equipment within fifteen days. The reasonable judgment of the Landlord of the necessity of such material as the Landlord may reasonably direct. Should the Tenant fail to comply with such request with fifteen days, the Landlord may do the work necessary to absorb, prevent or decrease the noise or vibration of such machinery or equipment and the Tenant will pay to the Landlord the reasonable thirty party out of pocket cost of suck work within ten days after demand or such cost may, at the option of the Landlord, be added to any installment or installments of rent under this lease and shall be payable by the Tenant as additional rent.
|
(a ) |
The Tenant shall not make any alteration, addition or improvement in or upon the premises, nor incur any expense therefore, without having first obtained the written consent for alterations, additions or improvements which are decorative in nature, such as painting or carpeting (although the Tenant shall give the Landlord prior written notice of the performance of such work). If the Tenant shall desire to make alterations, additions or improvements to fit out the premises for the Tenant’s use which will not affect the exterior of the building or adversely affect the structure of the building or the operation of any of the systems or facilities of the building for the use of any tenant or violate the requirements of government hereafter referred to, the Landlord’s approval will not be unreasonably withheld or delayed. In no event shall the Tenant make any alteration at any time when an Event of Default is outstanding. Any and all alterations may be made only subject to and in compliance with the following, as well as all other rules and regulations promulgated by the Landlord with respect to the performance of alterations.
|
(i.)
|
Prior to the commencement of any alteration, The Tenant shall, except in an emergency give at least 30 days notice to Landlord for all alterations and shall obtain the Landlord’s prior approval of the licensed architect and/or licensed professional engineer and the contractors and/or mechanics selected by the Tenant. The Tenant shall obtain the Landlord’s written approval of detailed plains and specifications prepared by the approved architect and/or engineer and reimburse the Landlord for its out of pocket expense n reviewing such plans and specifications, and no alterations shall be made except as are in all material respects in accordance with such plans and specifications or any approved changes thereto. If requested by the Landlord, the Tenant shall submit a copy of the general contractor’s contract or other contract for the alterations which shall show the cost thereof.
|
|
(ii.)
|
No alteration shall be commenced until the Tenant shall have obtained and paid for all required permits and authorizations of any City, State or Federal government agency or any board, bureau, department or body there of, having or asserting jurisdiction, copies which shall be supplied to the Landlord.
|
|
(iii.)
|
Prior to the commencement of any alteration, the Tenant shall submit to the Landlord duplicate original policies or certificates thereof of worker’s compensation insurance covering all persons employed in connection with the work and builder’s all risk and comprehensive general public liability insurance in such amounts and with such companies as may be approved by the Landlord and such coverage shall be maintained until all such alterations have been completed. Such policies shall name the Landlord and any mortgagee or holder of any ground or underlying lease as additional named insureds.
|
|
(iv.)
|
Upon completion of the alterations, the Tenant, at the Tenant’s expense shall obtain certificates of final approval as may be required by any governmental agency, board, bureau, depart or body thereof, and shall deliver such approvals to the Landlord, together with “s built” plans and specifications for such alterations. In addition, one copy of final drawings shall be delivered to the Landlord in AutoCad, Release 14 format, either on a 3.5 disk or CD Rom, or such other format as shall from time to time be reasonably designated by the Landlord.
|
|
(v.)
|
The cost of all alterations shall be paid hen due so that the premises shall at all times be free of liens for labor and materials supplies or claimed to have been supplies to the premises and free from any encumbrances, or security interests.
|
|
(vi.)
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All alterations, additions or improvements shall be made and installed in a good womanlike manner and shall comply with all requirements, by law, regulation or rule, of the Federal, State and City Governments and all subdivisions and agencies thereof, and with the requirements of the New York Fire Insurance Exchange, New York Board of Fire Underwriters and all other bodies exercising similar functions, and shall conform to any particular requirements of the Landlord expressed in its consent for the making of any such alterations, additions, and improvements. The Landlord’s review and approval of the Tenant’s plans shall not constitute, nor be deems to constitute a representation or agreement by the Landlord that such plans and specifications comply with such requirements. Such compliance shall be the sole responsibility of the Tenant.
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(b)
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All Alterations, additions or improvements, which may be made or installed in or upon the premises (whether made during or prior to the term of this lease or during the term of any prior lease of the premises by the Landlord, The Tenant or any previous tenant) Except the furniture, trade fixtures, stock in trade, and like personal property of the Tenant, shall be conclusively, deemed to be part of the freehold and the property of the Landlord, and shall remain upon the premises, and, upon the expiration or any termination of the term of this lease, shall be surrendered therewith as a part thereof, unless the Landlord shall, prior to expiration or termination of the term, notify the tenant that any or all of such alterations, additions or improvements shall be removed, in which event, the tenant shall remove the same in accord with the Landlords notice at its own cost and expense at or prior to the expiration or termination of the term. The Tenant, at or prior to the expiration or any termination of the term of this lease shall, at its own expense remove all its furniture, trade fixtures, stock in trade and like personal property. The tenant shall restore and repair, at its own cost and expense, any damage or disfigurement of the premises occasioned by any such removals or remaining after such removals, so as to leave the premises in good order and condition or, the landlord, at its option, may do such restoration and repair and the tenant will pay the cost thereof upon demand. If any furniture, trade fixtures, stock in trade or other personal property of the tenant shall not be removed at the expiration or any termination of this lease, the landlord, at the landlords option, may treat the same as having been irrevocably abandoned, in which the tenant shall have no further right, title or interest therein and the landlord may remove the same from the premises, disposing of them in any way which the landlord sees fit to do and the tenant shall on demand pay to the landlord the expense incurred by the landlord for the removal thereof as well as the cost of any restoration of the premises above provided. The tenant’s obligations under this subdivision (b) of this Article FOUR shall survive the expiration of this lease.
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(c)
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The Landlord may at any time during the term of this lease, change the arrangement or location of the entrance or passageways, doors and doorways, and the corridors, elevators, stairs, toilets or other parts of the building used by the pubic or in common by the Tenant and other parts of the building used by the public or in common by the tenant and other Tenants (including without limitation, the conversion of elevators from a manually operated to an automatic self service basis) and may alter staffing of the building and the scale and manner of the operation thereof, provided that the services to which the tenant is entitled as specified in this lease are not diminished and may alter the facilities, fixtures, appurtenances and equipment of the building as it may deem the same available, or as it may be required so to do by any governmental authority law, rule or regulation. The landlord may change the name, street number or designation by which the building is commonly known.
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(d)
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The Tenant shall not at any time prior to or during the term of this lease, directly or indirectly, employ or permit the employment of any contractor, mechanic or laborer in or about the premises, whether in connection with any alteration or improvement or the providing of any services or otherwise, if such employment would, in the judgment of the Landlord, disrupt, or interfere or cause any conflict wit, any other contractors, mechanics, or laborers engaged by the Landlord or any other tenant in the building. In the event of any such disruption, interfere or conflict, the Tenant, upon demand of the Landlord, shall immediately cause all contractors, mechanics or laborers causing such disruption, interference or conflict leave the building.
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(a)
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The Tenant shall without in any way affecting the tenant’s obligations hereunder, and without constituting any eviction, permit the Landlord and its agents and designees: (i) at all reasonable hours, to enter the premises and have access thereto, for the purpose of inspecting or examining them and to show them to other persons; (ii) to enter the premises (including, specifically, all mechanical and air conditioned rooms located therein) to make repairs and alterations and to do any work on the premises or any adjoining premises or property (including, but not limited to, the shoring up of the building) and to take in any of the foregoing instances, any space needed therefore; sand (iii) during the six months preceding the termination hereof, to place and maintain thereon the usual “for rent” notices. The Tenant shall permit the Landlord to erect and maintain ducts, pipes and conduits in and through the premises. In the exercise of the rights of the Landlord reserved under this Article NINE, the landlord will do so in a manner which minimizes the interference with the tenant’s use of the premises so far as practicable and where ducts, pipes or conduits are to be erected through the premises will locate them alone walls or ceiling wherever practical.
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(b)
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In the event that the premises shall, in the Landlord’s judgment, become substantially vacated before the expirations of this lease, or in the event the Tenant shall be removed by summary proceedings or in the event the tenant shall be removed by summary proceedings or in the event that, during the last month of the term, the tenant shall have moved all or substantially all of the Tenant’s property there from, the Landlord may immediately enter into and upon said premises for the purpose of decorating, renovating or otherwise preparing same of a new tenant, without thereby causing any abatement of rent or liability on the Landlord’s part for other compensation, and such acts shall have no effect upon this lease.
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(c)
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If the Tenant or an officer or authorized employee of the tenant shall not be personally present to open and permit an entry into said premises, at any time, when for any reason an entry therein shall be necessary or permissible hereunder, the Landlord or the Landlord’s agents, may enter the same by a master key or may forcibly enter the same without rendering the landlord or such agents liable therefore (if during such entry the Landlord shall accord reasonable care to the Tenant’s property) and without in any manner affecting the obligations and covenants of this lease and in no even shall any such entry by the landlord or its agents be deemed an acceptance of a surrender of this lease, either expressed or implied, nor a waiver by the Landlord of any covenant of this lease on the part of the tenant to be performed.
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(a)
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So long as electric current is to be supplies by the Landlord, the Tenant covenants and agrees to purchase the tenants requirements therefore at the premises from the landlord of the landlords designated agent at a price equal to 108% of the rates (as hereinafter defined) set forth in the rate schedule of Consolidated Edison Company of New York, Inc. applicable to the building (or the conjunctional group in which the building is included) plus an amount equal to all sales, use and gross receipt taxes and other governmental charges or levies, generally applicable to the purchase and sale of electricity in New York City (and without regard to whether the Landlord is exempt from paying or collecting any such tax, charge or levy) Provided however that if such rate schedule includes any adjustment for time of day for either demand or consumption, the rate applicable to the tenants demand for an consumption of electricity, shall be that specified for the peak period. As used herein, the term “rates” shall mean the rates for all components of the aggregate cost of purchasing electricity for the building, including, without limitation, all charges related to the generation, transmission, distribution and service and all charges for consumption and demand (including, without limitation, all seasonal and time of day adjustments and fuel escalation charges relating top such consumption and demand charges). All amounts payable under this Article TEN shall constitute additional rent for the purpose of the enforcement of the Landlord’s rights
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(b)
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Where more than one meter measures the service of the Tenant in the building, the service rendered through each meter may be computer and billed conjunctively as if on a single meter in accord with the rates herein provided for. The Tenant shall pay, within ten days after demand therefore, the bills for electric current furnished or the Landlord may, at its option, add such amounts to any installment or installments of fixed rent due under this lease and collect the same as additional rent. The tenant shall comply with such rules, regulations, and contract provisions as are customarily prescribed by the public service corporations supplying such services for consumption to similar to that of the Tenant.
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(c)
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The Landlord shall provide a total connected load of up to 10 watts per rentable square foot of 3 phase 4 wire electric power with full neutrals for all of the Tenant’s electrical consumption (inclusive of the air conditioning system). The Tenant agrees that its usage shall not exceed the capacity of existing feeders to the floor.
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(d)
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Should the Landlord at any time, be prevented from furnishing the foregoing service due to a change of rate or regulation of the Public Service Commission or due to any rate or regulation of the public utility corporation, serving the building, or if the Landlord for any other reason determines to discontinue the service, the landlord may do so , and will give the tenant not less than ninety (90) days notice of the date in which the service will be discontinued, if landlord is prevented from furnishing such service due to any rate or regulation. If the Landlord discontinues service for any other reason, it shall discontinue the supply of electric current at such time as the tenant is able after commercially reasonable efforts, to obtain alternative electrical service. Beginning with the date on which such service by the landlord is discontinued, the tenant shall purchase its requirements for electric current from the public utility serving the area directly. The landlord shall permit the Landlords wire and conduits, to the extent to which they are safely available for such use and the extent to which they may be so used under any applicable regulations (including those of such public utility) to be used for the purpose. Should the supply of electric current by the Landlord be discontinued as a result of the Landlords decision to discontinue such services, any additional or other wiring, conduits, meters or distribution equipment which is required in order to permit the Tenant to receive such direct service shall be installed by the Landlord at its sole cost and expense. Is such service is discontinued at the request of the Tenant (which request is subject to the Landlord’s prior approval) the cost of such wiring, conduits, meters and distribution equipment shall be the responsibility of the tenant and if such service is discontinued due to any rate or regulation of the public utility corporation serving the building such costs shall be home equally by the parties Landlord may at its sole option determine that a single meter will be utilized for the premised for electric billing purposes.
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(e)
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The Landlord shall not in any way be liable or responsible to the Tenant for any loss or damage or expense which the Tenant may sustain or incur if either the quantity or character or electric service is changed by the utility or is no longer available or suitable for the tenant’s requirements, nor shall the Landlord be in any way responsible for any interruption of service due to breakdowns, repairs, malfunction of electrical equipment or any other cause relating to electrical service which is beyond the Landlord’s reasonable control. The Tenant covenants and agrees that at all times it use of electric current shall never exceed the above stated capacity. If in the Landlord’s sole reasonable judgment, the tenant’s electrical requirements necessitate installation of an additional riser, risers or other necessary equipment, the same may be installed by the Landlord at the sole cost and expense of the Tenant, which shall be chargeable and collectible as additional rent. If the Tenant makes written request to install a riser or risers to supply the Tenant’s electrical requirements , such request shall be subject to the prior written consent of the Landlord in each instance, and such riser, risers or other equipment shall be installed by the Landlord, (and the Tenant shall be responsible for the reasonable out of pocket costs incurred by Landlord) If in the Landlord’s sole judgment, the same are necessary and will not cause or create a dangerous or hazardous condition or entail excessive or unreasonable alterations, repairs or expense or interfere with or disturb other tenants or occupants. If the Tenant is not utilizing the full electrical capacity available to the premises. The Landlord Shall have the right to make such excess capacity available to the premises, the landlord shall have the right to make such excess capacity available to other occupants of the building.
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(f)
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If there be any facilities for the supply of live steam in the building, such steam shall be supplied to the tenant only if separate agreements are made therefore and pursuant to such arrangements. In the event that such separate agreements shall be made, the appropriate provisions of the Article TEN shall be applicable thereto.
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(a)
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If the premises or any part thereof, shall be taken or condemned for any public or quasi public use (other than for temporary use or occupancy) this lease and the term hereby granted shall terminate as of the date of vesting of title by reason of such taken. If any other part of the building shall be so taken and such taking shall, in the judgment of the Landlord, make the operation of the building impractical, unprofitable or uneconomical or would make substantial structural alterations or reconstruction of the building necessary (even though no part of the premises be taken) The landlord may, at its option, give to the Tenant, at anytime after the besting of Title and prior to the actual taking of possession, thirty (3) days notice of intention to terminate this lease, and upon the date designated in such notice, this lease and the term hereby granted shall terminate. Anything herein to the contrary notwithstanding, if twenty-five (25%) perfect or less of the premises shall be so acquired or condemned, the Landlord, at its option, may elect not to terminate this lease and, in such case the Landlord Shall, at its expense, restore that part of the premises not so acquired or condemned to a self contained rental unit exclusive of the Tenant’s alterations. Notwithstanding the provisions of the immediately preceding sentence, if twenty-five (25%) percent or less of the premises shall be acquired or condemned, and if the Landlord as elected not to terminate this lease, the Tenant may give to the Landlord not less than thirty days notice that it elects to terminate this lease, the tenant may give to the Landlord not less than thirty days notice that it elects to terminate this lease, the tenant may give to the landlord not less than thirty days notice that it elects to terminate this lease if, in the reasonable judgment of the tenant, the taking of such portion would not allow the tenant to conduct its business as contemplated hereunder in the remaining portion of the premises. In No event shall any condemnation award be apportioned, and the tenant hereby assigns to the Landlord all right and claim to any part of such award, but the rent, and all other sums payable by the Tenant shall be apportioned as of the date of any such termination of this lease with respect to all or part of the premises, as the case may be, and in the case of a partial taking, prospective rent obligations which are based on square footage shall be adjusted accordingly. Nothing contained in the foregoing portion of the Article ELEVEN shall be deemed to prevent the tenant’s making claim for and retaining an award for the damage to or loss of value of its trade fixtures and such of the installations made by the Tenant as remain the Tenant’s property or from making claim for and retaining any award which may be made to the tenant for the tenants moving expenses if, and to the extent that, the award to be claimed and retained by the Tenant is independent of and does not result in a diminution of the award, and is not payable out of the award to the Landlord for taking of the Land, building and the Landlord’s other property.
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(b)
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If the Landlord shall desire to demolish the building wherein the premises are located, the Landlord shall have the right and option to terminate the term of this lease at any time during the term thereof upon giving to the Tenant not less than twelve months notice of the landlord’s election to terminate this lease and of the date, which shall be the last day of calendar month, not less than twelve months following the date of the Landlord’s notice of election to terminate, on which Landlord elects that this lease shall terminate and come to an end, together with an affidavit, sworn to by an officer of the landlord, if the landlord at such time is a corporation, or by a general partner of the landlord, If the landlord at such time is a partnership, or by the Landlord, if the landlord at such time is an individual, to the effect that the Landlord, its successor in interest or a lessee intends to demolish the building containing the premises. If such notice and affidavit are given to the Tenant, then this lease shall terminate and come to an end on the date of termination specified in the Landlord’s notice, as if that date were the date originally fixed for the termination of the term of this lease, and on such date the Tenant shall quit, vacate and surrender up the premises in accord with the provisions of this lease relations to surrender at the expiration of the term. Anything to the contrary notwithstanding, if the landlord delivers a termination notice, the tenant may, at its option, and on thirty (30) days prior notice to the Landlord, accelerate the termination date; during the six month period prior to the termination date set forth in the Landlord’s notice. Provided no Event of Default shall have theretofore occurred and be continuing hereunder, including, without limitation, the tenant’s obligation to vacate the premises on the date set forth in the Landlord’s notice, then not later then thirty (30) days following the Tenant’s Unamortized Improvement Expenses” shall mean a sum equal to the next expenditures actually incurred by the Tenant during the first twelve (12) months after the Commencement Date (Over and above any amount reimbursed by the Landlord to the Tenant pursuant to Article FORTY-FIVE of this lease) for alterations and improvements in the premises (excluding items of moveable furnishing, machinery and equipment) which next expenditures shall not, for purposes of this Article, exceed 244,000.00, multiplied by a fraction (x) the numerator of which shall be the number of months in the period commencing with the date of the termination of this lease pursuant to this Article and ending with the Expiration Date and 9y) the denominator of which is 84. If the Tenant shall make alterations and improvements in the premises at its expense with the respect to which it may wish to have the benefit of reimbursement pursuant to this Article, the tenant shall furnish the Landlord within 60 days following the completion of the alterations and improvements with a statement, in writing, certified to be correct by an officer or partner of the Tenant setting forth the amount of the Tenant’s expenses for each such alteration and improvement and soft costs. The Tenant shall also furnish the Landlord with Receipted copies of bills and such other additional information as the Landlord may reasonably request.
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The Tenant will not permit, during the term hereby granted, any mechanic’s or other lien or order for payment of work, labor, services, or materials furnished or to be furnished to attach to or affect the premises or any portion thereof, and agrees that no such lien or order shall under any circumstances attach to or affect the fee, leasehold or other estate of the Landlord herein, or the building. The Tenant’s obligations to keep the premises in repair, and it’s right to make alterations therein, if any shall not be construed as the consent of the Landlord to the furnishing of any such work, labor or materials within the meaning of any present of future lien law. Notice is hereby given that the Tenant has no power, authority or right to do any act or to make any contract which may create, or be the foundation for, any lien upon the fee or leasehold estate o the landlord in the premises or upon the land or building of which they are a part or the improvements now erected or hereafter to be erected upon the premises or the land, or building of which the premises are a part: and if any such mechanic’s or other lien or order shall be filed against the premises or the land or building of which the premises are a part, the Tenant shall, within thirty(30) days thereafter, discharge sad lien or order by payment, deposit or by bond fixed in a proper proceeding according to the law. If the tenant shall fail to take such action, or shall not cause such lien or order to be discharged within (30) days after the filing thereof, the Landlord may pay the amount of such lien or discharge the same by deposit or by bond or in any other manner according to law, and pay any judgment recovered in any action to establish or foreclose such lien or order, and any amount so paid, together with the expenses incurred by the Landlord, Including all attorney’s fees and disbursements incurred in any defense of any such action, bonding or other proceeding, shall be deemed additional rent. Any reasonable expenses incurred by the landlord in connection with examination of title to the premises in order to ascertain the existence of any lien or encumbrance and the discharge of record thereof, shall be payable by the Tenant to the Landlord on demand, together with interest as aforesaid as additional rent.
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(a)
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This lease, and all rights of the Tenant hereunder, are and shall be subject and subordinate to any and all mortgages now or hereafter liens either in whole if in part of the building, or the land on which it stands, and also to any and all other mortgages covering other lands or lands and building, which may now or hereafter be consolidated with any mortgage or mortgages upon the building and the land on which it stands or which may be consolidated and spread to cover the building and such land and any such other lands or lands and buildings, and any extensions, renewal or modifications thereof. This clause shall be self operative and no further instrument of subordination shall be required by any ground or underlying lessor or by any mortgagee, affecting any lease or the building or the land on which it stands, and any extensions, renewals or modifications thereof. This clause be self-operative and no further instrument of subordination shall be required by any ground or underlying lessor or by any mortgagee, affecting any lease or the building or the land on which it stands. In confirmation or such subordination, the Tenant shall execute promptly any certificate, in recordable form, that the Landlord may reasonably request.
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(b)
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The Landlord shall request from any future mortgagee of future lessor of any underlying lease, a subordination, non disturbance and attornment agreement (the SNDA Agreement”) for the benefit of the Tenant, in the then customary form of such mortgagee or lessor. If an SNDA Agreement is provided, the Tenant agrees that it will execute any document which may be reasonably required by such mortgagee or lessor to confirm the subordination of this lease. The Landlord shall have no liability if the mortgagee or lessor refuses or fails to enter into a SNDA Agreements and the failure of the mortgagee or lessor to enter into such Agreement shall not affect the validity of this lease, including, without limitation, the provisions of this Article THIRTEEN.
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(c)
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The Tenant hereby agrees that, in the event that any mortgagee shall succeed to the rights of the landlord , or if any Landlord of any underlying lease shall succeed to the position of the Landlord under this lease, then the Tenant will recognize such successor Landlord as the Landlord of this lease and pay the rent and attorn to and perform the provisions of this lease for the benefit of any such successor Landlord. No documentation other than this lease shall be necessary to evidence such attornment but the tenant agrees to execute any documents, in recordable form reasonably satisfactory to the Tenant, reasonably requested by the successor Landlord to confirm such attornment or to otherwise carry out the intent and purposes of this Article THIRTEEN.
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(d)
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If, in connection with obtaining financing or refinancing for the building of which premises form a part, a lender shall request modifications to this lease as a condition to such financing or refinancing, the tenant will not unreasonably withhold, delay or defer its consent thereto, provided that such modifications do not increase the obligations or reduce the rights of the Tenant hereunder or adversely affect the tenant’s leasehold interest. A provision requiring the Tenant to give notices of any defaults by the Landlord to such lender and/or permit the curing of such defaults by such lender together with the granting of such additional time for such curing may be reasonably required for such lender to get possession of the building shall not be deemed to increase the Tenant’s obligations or adversely affect the tenant’s leasehold interest. In no event shall a requirement that the consent of any such lender be given for any modification, termination, or surrender of this lease be deemed to materially adversely affect the leasehold interest hereby created.
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(e)
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Anything herein to the contrary notwithstanding, the Landlord represents and warrants to the Tenant that as of the date of this lease there is no mortgage or superior lease encumbering the premises or the building or the land upon which the building is located.
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(a)
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A true copy of the Certificate of Occupancy of the building is annexed hereto as Exhibit B.
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(b)
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The Tenant shall immediately discontinue any use of the premises, which may, at any time, be claimed or declared by the City or State of New York or other governmental authority to be in violation of or contrary to Certificate of Occupancy of the building, or by reason of which any attempt may be made to penalize the Landlord or require the Landlord to secure any certificate of Occupancy other then the one, if any now issued for the building.
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(a)
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If the premises shall be damaged by fire, action of the elements or other casualty or cause which is within the risks covered by insurance carried by the Landlord, The Tenant shall give immediate notice thereof to the Landlord, and said damage shall be repaired by the Landlord, at the Landlord’s expense, with all reasonable speed, making due allowance for delay due to labor trouble, settlements of loss and other causes beyond the control of the Landlord, and the Tenant shall remove its property so as to facilitate the making of such repairs, and the rent shall be suspended during such period as the premises shall have been rendered wholly untenantable until five (5) days after the landlord notifies the tenant that the premises are substantially ready for the Tenant’s occupancy (or the premises are sooner occupied by the Tenant for the conduct of its business) and, in the event that the premises are rendered partially untenantable, the rent shall be abated during such period, in the proportion which the area of the premises which is rendered untenantable bears to the area of the whole premises. No damage to premises or the building by fire, or other cause, however extensive, shall terminate this lease, or give the Tenant the right to quit and surrender the premises, or impair any obligations of the Tenant hereunder, except with respect to the payment of rent (and with respect thereto the extent above provided) and except that (i) If the Damage shall be so extensive that the Landlord shall determine to demolish or substantially alter the building, whether or not the premises are affected, the Landlord, may at any time within one hundred twenty (120) days following the occurrence of the damage give to the Tenant thirty (30) days notice of intention to terminate this lease; (ii) If the damage to the premises is substantial so that the whole or substantially the whole of the premises is rendered untenantable by the Tenant of if 50% or more of the common areas of the building are destroyed or substantially damaged and the landlord does not within 60 days following the occurrence of the damage notify the Tenant of the Landlord’s intention to repair the damage to the premises so that the premises are again useable by the Tenant within a period of not more than 180 days following the occurrence of the damage subject to delays due to settlement of loss or delays of the kind described in Article THIRTY-FOUR of this lease, the tenant may cancel this lease by notice given within 10 days following the expiration of the said 180 day period, time being of the essence, and (iv) in the event of the occurrence of damage to the premises of the degree described above in clause (ii) of this paragraph (a) The Landlord may also elect to terminate this lease by notice of election to do so given within 60 days following the occurrence of the damage. If notice of election to terminate this lease shall be given as above provided, then upon the date for terminate and the rent shall be apportioned as of the date of the damage or as of such later date as Tenant may actually surrender possession. Nothing herein contained shall be deemed to obligate the Landlord to restore the tenant’s trade fixtures, equipment, stocks, furnishing, improvements or other property remaining the property of the Tenant. The Tenant acknowledges that the landlord will not carry insurance on the Tenant’s furniture or any fixtures or equipment, improvements or appurtenances removable by the Tenant and agrees that the Landlord will not be obligated to repair any damage thereto or replace the same. The Tenant hereby waives the provisions of Sections 227 of the Real Property Law and Agrees that the provisions of this Article SIXTEEN shall govern and control in lieu thereof.
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(b)
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The Tenant shall conduct its business and use the premises in such manner and so as not to increase the rate of fire insurance applicable to the building or any property located therein over the rates in effect prior to the commencement of the Tenant’s occupancy, and the tenant shall install and maintain all its furniture, fixtures, equipment, stocks and materials in such a manner to accomplish the foregoing purposes. The Tenant further agrees not to permit any act to be done or anything brought into or kept upon the premises which will void or avoid the insurer’s liability under any contract of fire insurance on the building or its contents. Should the fire insurance rate on the building be increased beyond the present rate by reason of the Tenant’s particular manner of use of the premises, as opposed to general office use, or the Tenant’s failure to comply with the terms hereof, the Tenant agrees to pay to the Landlord, on demand, the additional cost of such insurance, or at the option of the Landlord, the same may be added to any installment of rent and be payable as additional rent. The Schedule of the makeup of a rate issued by an authorized rating organization shall be conclusive evidence of the facts therein stated and of the items in the rate applicable to the premises.
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(c)
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The Landlord, as to the premises and the tenant as to the improvements made therein at the Tenants expense and all of the Tenants stock, trade fixtures and other property in the premises shall each look first to any insurance in its favor before making any claim against the other party for recovery for loss or damage resulting from fire or other casualty, and to the extent that such insurance is in force and collectable and to the extent permitted by law, the Landlord and the Tenant each hereby release in another or any one claiming through or under each of them by way of subrogation or otherwise from all liability for any loss or damage caused by fire or any of the risks enumerated in standard extended coverage insurance. This foregoing release and waiver shall be in force only if both releaser’s insurance policies contain a clause providing that such a release or waiver shall not invalidate the insurance, and also provided that such a policy can be obtained without additional premiums. The Landlord and the Tenant agree that their respective insurance policies will include the aforesaid clause so long as the party for whose benefit the clause is obtained shall pay such extra cost. If extra cost shall be chargeable therefore the party so affected shall advise the other thereof, of the amount of the extra cost and the other party at its election may pay the same or decline to so pay, in which event the release from liability given to said party by this article SIXTEEN shall be deemed to be withdrawn and of no force and effect.
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(d)
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The Landlord shall keep in full force and effect a policy of insurance against loss or damage by fire and such other risks and hazards as are insurable under standard forms of “all risk” insurance policies, with extended coverage, covering the building, in an amount sufficient to avoid the effects of co-insurance, in such amounts as the Landlord may deem appropriate.
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(e)
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If Notwithstanding the recovery of insurance proceed by the Tenant for loss, damage or destruction to its property, the Landlord is liable to the Tenant with Respect thereto or is obligated under this lease to repair or restore such damage, the amount of the net proceeds paid to the Tenant shall either be offset against the Landlord’s liability to the tenant, or shall be made available to the Landlord to pay for the cost of such repair or restoration.
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(a)
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The use to be made of the premises by the Tenant and the identity of the Tenant being among the inducements to the making of this lease by the Landlord, except as otherwise set forth herein, the Tenant shall not, without first having obtained the Landlord’s prior written consent thereto, which shall not be unreasonably withheld or delayed and otherwise in accordance with the terms of this lease, (i) sublet or underlet, or permit the subletting or under letting of the premises or any part thereof (ii) assign or transfer , by operation of law or transfer of stock or otherwise, this lease or any interest therein; (iii) use or permit the premises of any part thereof to be used for any other purposes other than those specified in the lease; (iv) Permit the premises or any part thereof to be occupied by anyone other than the Tenant or its officers or employees; or (v) mortgage or encumber this lease or any interest therein.
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(b)
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The Landlord agrees not to unreasonably withhold or delay its consent to any proposed assignment or subletting, provided, however that the landlord shall have the right to condition its consent to any proposed assignment or sublease on the following:
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1)
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No Event of Default shall have theretofore occurred and be continuing under this lease
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2)
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With Respect to a sublease, the Tenant shall collaterally assign to the Landlord, and grant the landlord a security interest in, the sublease and the rents payable thereunder and shall take all necessary steps required to perfect such assignment and security interest.
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3)
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The sublease shall include provisions to the effect that (i) if the Landlord shall notify the sublesse that the Tenant is in default in the payment of rent or in the performance of its other obligations under this lease beyond the expirations of applicable notice and cure periods, the subtenant shall, is so requested by the Landlord, pay all rent and other amounts due under the sublease directly to the Landlord (ii) notwithstanding any such payment by the subtenant directly to the Landlord, the term of the sublease shall terminate simultaneously with the termination of the term of this lease and the subtenant shall surrender the subleased premises upon such termination (iii) the sublease shall be subject and subordinate to this lease and to all matters to which this lease is or shall be subordinate, and (iv) any act or omission by the subtenant which , if performed by the Tenant would constitute an Event of Default under this sublease.
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4)
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The proposed subtenant or assignee shall have a financial standing and propose to use the premises in a manner, which in the Landlord’s reasonable judgment, is in keeping with the landlord’s standards in such respect of the other office tenancies in other buildings of the Landlord. The Parties acknowledge that the Landlord, as a religious institution, may have special considerations in determining if the business or proposed use id a proposed subtenant or assignee is objectionable, and the parties agree that the Landlord’s reasonable judgment in such matters shall be conclusive.
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5)
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The Proposed assignee or subtenant shall not then be a tenant, subtenant or assignee of any space in the building or any other building then owned directly or indirectly, by the Landlord, nor shall the proposed subtenant or assignee be a person or entity with whom the Landlord is then negotiating to lease space in the building or any other building then owned, directly or indirectly by the landlord.
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6)
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The Premises shall not, without the Landlord’s prior consent have been publicly advertised (but may be listed) for subletting at a rental rate less than the prevailing asking rental rate then set by the Landlord for comparable space in the building, and if no comparable space is then available, at the prevailing rental rate set by the Landlord
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7)
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Intentionally Omitted
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8)
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Any proposed sublease shall provide that in the event of the termination of this lease, or the re-entry or dispossession of the Tenant by the Landlord under this lease, such subtenant shall, at the landlord’s option, attorn to the landlord as its sublessor pursuant to the then applicable terms of such sublease for the remaining term thereof, except that the landlord shall not be (i) liable for any previous act or omission of tenant as sublessor under such sublease, (ii) subject to any offset which theretofore accrued to such subtenant against the Tenant, (iii) bound by any modification of such sublease not consented to in writing by the landlord or by any prepayment of rent more than one month in advance, (iv) bound to return such subtenants security deposit until it has come into its actual possession and the subtenant would be entitled to its return pursuant to the terms of the sublease, and (v) bound by any obligation to make any payment to any subtenant or perform any work in the premises.
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9)
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The proposed assignee or subtenant is not entitled, directly or indirectly to diplomatic or sovereign immunity, and/or is subject to the service or process in, and the jurisdiction of the courts of New York.
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10)
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There shall be no more than three (3) occupants in the premises, including the Tenant, at any time during the term of the lease.
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11)
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The subletting shall end no later than one (1) day before the Expiration Date and shall be for a term of no less than two (2) years, unless it commences less than two(2) years before the Expiration Date.
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12)
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The term of the sublease or the effective date of any assignment shall not commence prior to the one(1) year anniversary of the Commencement Date.
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13)
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The Assignee shall assume, in writing, all obligations of the Tenant under this lease from and after the date of such assignment
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14)
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A fully executed counterpart of the assignment or sublease shall be delivered to the Landlord within five (5) days after execution thereof.
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(c)
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The Tenant shall pay all of the reasonable third party out of pocket costs incurred by the Landlord (including, without limitation, attorneys fees and expenses) related to the Landlord’s review of a proposed sublease or assignment and the preparation, review and approval of any assignment of rents, financing statement and other documents related to such sublease or assignment, irrespective or whether consent is granted or the transaction is ultimately consummated. The Tenant shall also pay out of cost of recording or filing any assignment of rents and financing statements.
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(d)
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Provided no Event of Default shall have theretofore occurred and be continuing under this lease, the Tenant named herein is authorized to (1) assign the lease to any entity succeeding to the business and assets of the Tenant, whether by way of merger or consolidation or by way of acquisition of all of substantially all of the assets of the Tenant, provided that the acquiring entity shall have assumed in writing the Tenant’s obligations under this lease; or (2) to sublease all or a portion of the premises or assign the lease to an entity which shall (x) Control, (y) be under the control of, or (z) be under common control with tenant (an entity described in (x), (y) or (z) being a “Related Entity”) Control Shall mean direct or indirect ownership of more than fifty percent (50%) of each class of stock which is authorized to vote of a corporation or other entity whether through the ownership of voting securities by statute or according to the provisions of a contract. Upon making a sublease or assignment to any related entity, the tenant shall notify the landlord and certify to the landlord the manner in which such related entity is related to the tenant and the purposes for which the premises will be used. Any subletting or assignment described in this paragraph (i) shall be on notice to Landlord but shall not require the prior written consent of the Landlord and may only be made on the condition that (a) the subtenant or assignee shall continue to use the premises for the purposes permitted in this lease, and (ii) the principal purpose of such sublease or assignment is not the acquisition of the Tenant’s interest in this lease, or to circumvent the provisions of paragraph (a) of this Article SEVENTEEN. In the event of an assignment pursuant to the provisions of clause (1) of this paragraph (i) The successor entity after giving effect to such merger, consolidation or acquisition shall have a tangible net worth, exclusive of goodwill, computed in accordance with generally accepted accounting principals (“NET WORTH”) at least equal to the net worth of the tenant as of the date of this lease. The Provisions of this paragraph (e). If at any time after the lease has been assigned, or the premises sublet to a “related entity” there is a transfer of interest, so that the subtenant or assignee no longer qualifies as a related entity pursuant to the provisions of this paragraph (d) such transfer shall be deemed an assignment or sublease to which the provisions of this Article SEVENTEEN shall apply.
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(e)
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For Purposed of this Article SEVETEEN, an ‘assignment” shall be deemed to include, whether occurring at one time or over a period of time through a series of transfers, a sale or transfer of fifty (50%) percent or more of beneficial interest in the Tenant or in any entity which controls the Tenant (whether stock, partnership or otherwise) or of any guarantor of thee Tenant’s obligations under this lease or , or the issuance of additional stock where the issuance of such additional stock will result in a change of “control” (as defined in paragraph(i)) in the Tenant or guarantor, if applicable. The Transfer of shares or issuance of additional stock of the Tenant or any guarantor for purposes of this Article SEVENTEEN shall not include the sale of shares by persons other than those deemed “insiders” within the meaning of the Securities and Exchange Act of 1934, as amended, which sale is effected through the “over the counter market” or through any nationally recognized exchange.
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(f)
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In the event the Landlord in its sole reasonable discretion authorizes the Tenant to assign the lease or to sublet all or a portion of the premises (other then an assignment or subleasing authorizes by paragraph (i) above) The Tenant named herein shall pay to the Landlord, monthly as received by the Tenant, as additional rent, fifty (50%) percent of all Tenant’s profit. “Tenant’s Profit” Shall mean all consideration received by the tenant (other than rental or consideration received by the Tenant under a sublease or assignment entered into pursuant to paragraph (i) of this Article) less (i) The rent, payable by the Tenant under this lease doe the period in question (exclusive of any amount payable by the Tenant under this subparagraph (k)), Such rent to be pro-rated if less than all of the premises are sublet (ii) any brokerage commissions (not exceeding 110% of those set forth in Landlord’s brokerage commission schedule as published from time to time). And reasonable legal fees paid by the Tenant to the Landlord pursuant to the provisions of paragraph 9h) of this Article (iv) any payments made by the Tenant in connection with the assignment of its interest in this lease pursuant to Article 31-B of the Tax Law of the State or New York or any real property transfer tax of the United States or the City or State of New York (other than income taxes), (v) reasonable advertising costs incurred in connection with such subletting or assignment, (vi) any free rent or work allowance or work letter payable to or for the benefit of any subtenant or assignee, and (vii) reasonable value of any other construction performed by or on behalf of the tenant and necessary to sublet the premises. In the case of a sublease, the expense set forth in (ii)-(vii) shall be amortized on a straight line basis over the term of the sublease. In the case of an assignment, if the consideration to be paid to the Tenant shall be paid in installments, the expenses set forth in (ii) through (iv) shall be amortized over the period during which the installments are to be paid.
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(g)
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No Consent given by the landlord shall be deemed to permit any act except the act to which it specifically refers, or to render unnecessary any subsequent consent, and any assignment or subletting of the premises shall not relieve the Tenant or any means assignee from any obligations, duty or covenant under this lease. No assignment, transfer, mortgage, encumbrance, subletting or arrangement in respect of the occupancy of the premises shall create any right in the assignee, transferee, mortgagee, subtenant or occupant, unless the consent of the Landlord, if required shall first have been obtained in accordance with the provisions of this Article SEVENTEEN. Any assignee by accepting an assignment shall nevertheless be conclusively deemed to have assumed this lease and all obligations to accrue there under and further to have agreed to fully and duly perform all the Tenant’s covenants herein contained. If the tenant shall, at any time, be in default in the payment of rent, the landlord shall have the right to collect rent from any assignee or subtenant, and credit the same to the account of the Tenant, and no such collection shall constitute a waiver of the foregoing covenant or the acceptance of anyone other than the Tenant, as the tenant, or shall otherwise release, impair or otherwise affect any obligation of the Tenant under this lease.
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(h)
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The Tenant shall remain fully liable for the performance of all the Tenant’s obligations hereunder notwithstanding anything provided for herein, and without limiting the generality of the foregoing, shall remain fully responsible and liable to the landlord for all acts and omissions of any subtenant or assignee or anyone claiming under or through any such person which shall be in violation by the tenant. Upon any termination of this lease, it is expressly agreed that the tenant, shall deliver to the Landlord all sublease, security deposits (including interest), contracts, documents, rent rolls and other records used in the operation of the premises and, unless the sublease shall have previously terminated and the security deposit returned to subtenant or applied as provided by the sublease, all security deposits held by the Tenant.
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(i)
|
With respect to any present or future subleases, the Tenant shall not accept prepayment of rent prior to its due date in excess of one month (but the provisions of the foregoing shall not prohibit the Tenant from collecting from any subtenant a security deposit provided such security deposit is delineated in the sublease as being not advance rent, but security, returnable to the subtenant after the termination of the term of the sublease) The Tenant agrees to indemnify and save the Landlord harmless from and against any claim or lien against the Landlord or the premises for the return of any security under any subleases with a subtenant which was not previously delivered to the Landlord and agrees further that all subleases hereafter made with subtenants shall Provide that the lease security deposited by the subtenant shall not be a lien or claim against the interest of the Landlord
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(j)
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(i) Subject to all bankruptcy laws, if the Tenant assumes this lease and proposes to assign the same pursuant to the provisions of 11 U.S.C Section 101 et. Seq (the “Bankruptcy Code”) to any person or entity who shall have made a bona fide offer to accept an assignment of this lease on terms acceptable to the tenant, then notice of such proposed assignment shall be given to the Landlord by the Tenant no later than twenty (20) days after receipt by the Tenant of such bona fide offer but in any event no later than ten (10) days prior to the date that the Tenant shall make application to a court of competent jurisdiction for authority and approval to enter into such assignment and assumption. Such notice shall set forth 9x) the name and address of such person, (y) all of the terms and conditions of such offer, and 9z) adequate assurance of future performance by such person under this lease, including, without limitation, the assurance referred to in Section 365 (b) (3) of the Bankruptcy Code. The Landlord Shall have the prior right and option, to be exercised by notice to the Tenant given at any time prior to the effective date of such proposed 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 commission which would be payable in connection with such assignment.
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(ii) The term “adequate assurance of future performance” as used in this lease shall mean that any proposed assignee shall among other things: (a) deposit with the Landlord on the assumption of this lease an amount equal to the then fixed rent and additional rent as security for the faithful performance and observance by such assignee of the terms and obligations of this lease, which sum shall be held in accordance with the provisions of Article TWENTY-NINE hereof; (b) furnish the Landlord with financial statements of such assignee for the prior three(3) fiscal years, as finally determined after an audit and certified as correct by a certified public accountant, which financial statements shall show a Net Worth of at least the Net Worth of the Tenant named herein as of the date of this lease for each of such three (3) years and (c) provide such other information or take such action as the landlord, in its reasonable judgment shall determine is necessary to provide adequate assurance of the performance by such assignee of its obligations under this lease.
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(k)
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Notwithstanding anything to contrary contained herein, no assignment or subletting by the Tenant, nor any other transfer or vesting of the Tenant’s interest hereunder (whether by merger, operation of law or otherwise), shall be permitted if the proposed assignment or sublease (i) provides for a rental or other payment for the leasing, use, occupancy or utilization of al or any part of the premises based, in whole or in part, on the income or profits derived by any person from the property so leased, used, occupied or utilized other than an amount based on a fixed percentage or percentages of gross receipts or sales to (ii) does not provide that such assignee or subtenant shall not enter into any lease, sublease, license, concession or other agreement for the use, occupancy or utilization of all or any portion of the premises which provided for a rental or other payment for such use. Occupancy or utilization based, in whole or in part, on the income or profits derived by any person from the property so leased, occupied or utilized other than an amount based on a fixed percentage of gross receipts or sales.
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a)
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The Tenant shall make no claim upon the landlord for abatement of rent, constructive eviction, rescission, or otherwise, and the landlord shall be exempt from all liability, except for injuries to the Tenant’s person or property which are due to negligence of the Landlord, Its agents servants or employees in the management of the premises or the real property of which the premise are a part, for or on account of any annoyance, inconvenience, interference with business, or other damage, caused by (i) any interruption, malfunction or curtailment of the operation of the elevator service, heating plants, sprinkler system, gas, water, sewer or steam supply, plumbing, machinery, electric equipment or other appurtenances, facilities, equipment and conveniences in the building, whether such interruption, malfunction, or curtailment be due to breakdowns, or repairs or strikes or inability to obtain electricity, fuel or water due to any such cause or any other cause beyond the landlord’s control; (ii) any work of repair, alteration, renovation or replacement done by or on behalf of the landlord or any other tenant; (iii) any water, rain, snow, steam, gas, electricity or other element, which may enter, flow from or into the premises or any part of the building, or any noise or vibration audible in, or transmitted to the premises; (iv) any vermin; (v) any failing paint, plaster or cement; (vi) any interference with light or with other easements or incorporeal hereditaments (vii) any latent defect or deterioration in the building or the appurtenances thereof, whether or not the Landlord shall have been notified of any condition allegedly causing same; (viii) any zoning ordinance or other acts of governmental or public authority now or hereafter in force; and (ix) any act or omission of any other occupant of the building or other person temporarily therein. The tenant will not hold the landlord liable for any loss or there of , or damage to, any property in the premises done or caused by an employee, servant, or agent of the landlord who is invited into the premises by the Tenant, nor for the loss, damage or theft of any property stores or left in the basement or in any other part of the building, which is not enclosed within the premises or of any property, left with an employee of the Landlord, notwithstanding such theft, loss or damage may occur through carelessness or negligence of the landlords employees and the Tenant agrees that any employee in entering the premises at the invitation of the Tenant or other person at whose instance he may be acting and not agent of the landlord. Employees are not permitted to receive or accept packages or property for account of Tenants. The use of storerooms or storage space for personal property (if provided (shall be at the tenant’s risk and the tenant will not hold the landlord liable for any loss of or damage to person or property therein thereby. Nothing in this lease contained shall impose any obligation upon the landlord with respect to any real property other than the building whether said other real property be owned by the landlord or otherwise, or shall in any way limit the landlords right to build upon or otherwise use said other real property in such manner as the landlord may see fit. The Tenant shall make no claim upon the landlord for abatement of rent, constructive eviction or rescission, and the landlord shall have no liability by reason of the Landlord’s failure to enforce the provisions of the lease to any other tenant against such other tenant.
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b)
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Any right and authority reserved by and granted to the landlord under this lease, to enter upon and make repairs in the premises shall not be taken as obligating the landlord to inspect and to repair the premises and the landlord hereby assumes no responsibility or liability for the care, inspection, maintenance, supervision, alteration or repair of the premise except as herein specifically provided. The Tenant assumes possession and control of the premises and exclusively the whole duty of care and repair thereof, except as here in specifically provided and the duty of care, f if any, owned by the tenant to the persons on the sidewalks or in the corridors of the building.
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c)
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The officers, directors, employers, partner’s shareholders and principals direct of indirect comprising the Landlord (collectively the “Parties”) shall not be liable for the performance of the Landlord’s obligations under this lease. The Tenant shall not look solely to the landlord to enforce the landlord’s obligations under this lease. The Tenant shall look solely to the Landlord to enforce the landlord’s obligations under this lease and shall not seek any damages against any of the Parties. The liability of the Landlord for the Landlord’s obligations under this lease shall be limited to Landlord’s Equity in the building. “Landlord’s Equity” as used herein means the lesser of (i) the interest of the Landlord in and to the building and (ii) the interest the Landlord would have in the building if it were encumbered by an indebtedness held by a person not a party to this lease in an amount equal to 75$ of then current fair market value of the building (as such value of such interest is determined in good faith by the Landlord). The Tenant shall not look to any other property or assets of the Landlord, Other than Landlord’s Equity, or the property or assets of any of the parties in seeking either to enforce the Landlord’s obligations under this lease or to satisfy a judgment for the Landlord’s failure to perform such obligations.
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d)
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The Term “Landlord” As used in this lease, means only the owner for the time being of the premises. If the Landlord shall hereafter sell, exchange or lease the entire building or the land and building wherein the premises are located, or being the lessee thereof, shall assign its lease, the grantee, lessee, or assignee thereof, as the case may be shall, without further agreement by any party, be exclusively deemed to be the landlord of this lease and to have assumed and undertaken to carry out all of the obligations hereof on the part of the landlord to be performed, and the tenant does hereby release the above named landlord from any claim or liability arising or accruing hereunder subsequent to such transfer of ownership or possession, for breach of the covenant of quiet enjoyment, otherwise.
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e)
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If the lease provides that the Landlord’s consent is not to be unreasonably withheld or delayed, and it is the final order of any court having jurisdiction thereof that the Landlord has been unreasonable, the only effect shall be that the Landlord shall be deemed to have given such consent but in no event shall the landlord be liable to the tenant for any monetary damages by reason of the withholding or delaying of its consent.
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(a)
|
Each of the following shall be a “Bankruptcy Event” Hereunder:
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(1)
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if the tenant shall generally not, or shall be unable to, or shall admit its inability to pay its debts as they become due; or
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(2)
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if the tenant shall make a general assignment for the benefit of creditors; or
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(3)
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if the tenant shall commence or institute any case, proceeding or other action (i) seeking relief on its behalf as debtor, or to adjudicate it a bankrupt or insolvent , or seeking reorganization, arrangement, adjustment, winding up, liquidation, dissolution, composition, or other relief with respect to it or its debts under any existing or future law of any jurisdiction, domestic or foreign, relating to bankruptcy, insolvency, reorganization or relief of debtors, or (ii) seeking appointment of a receiver, trustee, custodian or other similar official for it or for all substantial part of its property.
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(4)
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If any case, proceeding or other action shall be commenced against or instituted against the tenant (i) seeking an order for relief entered against the debtor or to adjudicate it a bankrupt or insolvent or seeking reorganization, arrangements, adjustment, winding up, liquidating, dissolution, composition, or other relief with respect to its debts under any existing or future law of any jurisdiction, domestic or foreign, relations to bankruptcy , insolvency, reorganization or relief of debtors, or (ii )seeking appointment of a receiver, trustee, custodian, or other similar official for it or for all of any substantial part of its property, which in either case (x) results in the entry of any order for relief, adjudication of bankruptcy or insolvency, or such an appointment or the issuance or entry of any other order having a similar effect or (y) remains undismissed for a period of sixty (60) days or;
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(5)
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If any case proceeding or other action shall be commenced or instituted against the tenant seeking issuance of a warrant of attachments, execution, distraint, or similar process against all or any substantial part of the tenant’s property which results in the entry of an order for such relief which is not vacated, discharged, or stayed or bonded pending appeal within sixty (60) days from the entry thereof; or
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(6)
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If the Tenant shall take shall take any action in furtherance of, or indicating its consent to approval of, or acquiescence, if any of the acts set forth in any clauses (2) through (5) above or;
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(7)
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If a trustee, receiver or other custodian is appointed for any substantial part of the assets of the tenant and such appointment is not vacated or stayed within seven days.
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(b)
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If at any time (i) the Tenant shall be comprised of two or more people; or (ii) the Tenant’s obligations under this lease have been guaranteed by any party other than the Tenant or (iii) the Tenant’s interest in this lease has been assigned, the word “tenant” as used in this article TWNTY-THREE shall be deemed to mean any one or more of the persons primarily or secondarily liable for the Tenant’s obligations under this lease. Any moneys received by the Landlord from or on behalf of the Tenant during the pendency of any Bankruptcy Event shall be deemed paid as compensation for the use and occupation of the premises and the acceptance of any such compensation by the Landlord shall not be deemed an acceptance of rent or a waiver by the Landlord of any rights under Articles TWENTY-THREE or TWENTY-FIVE
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(c)
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If a Bankruptcy Event occurs at any time after the execution and delivery of this lease, whether such event occurs prior or subsequent to the Commencement Date or the Tenant’s entry into possession, such an event shall be deemed an Event of Defaults and the Landlord shall have the right to terminate this lease in the manner hereinafter provided. In the Event of such termination the tenant or any person claiming under, by or through the Tenant, by virtue of any statute or of an order of any court, shall not be entitled to possession or to remain in possession of the premises but shall forthwith quit and surrender same. Exclusive of and in addition to any other rights or remedies the landlord may have through any other portion or provision of this lease or by virtue of any rule of law or statute, said landlord may keep and retain, as damages, any rent, security, deposit or other moneys or consideration received by the landlord from the tenant or others on behalf of the tenant. Also in the event of termination of this lease as aforesaid, the landlord shall be entitled, as and for liquidated damages, and not as a penalty, from the tenant for breach of the unexpired term of this lease, to a sum equal to the amount by which the rent for the period of the unexpired portion of the lease term exceeds the ten fair and reasonable rental value for the same period, both discount to present value at six percent (6%). If at any time within a reasonable period following the date of the termination of the lease, as aforesaid, the premises should be re-rented by the Landlord, the rent realized by any re-letting shall be deemed prima facie to be the rental value. In the event of the occurrence of any Bankruptcy Event occasioned solely through the invocation by the Tenant or by third parties of the laws of the State of New York, judicial or statutory, as distinguished from the invocation of Federal laws relating to bankruptcy, reorganization, or otherwise, the Landlord, in addition to the foregoing, may accelerate the full amount of rent reserved for the remainder of the lease, and the same shall forwith become due and payable to the Landlord. Nothing herein provided shall be deemed to prevent or restrict the Landlord from proving and receiving as damages herein the maximum permitted by any rule of law or statute prevailing when such damages are to be proved, whether they be greater or less than those referred to above.
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(a)
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Each of the following events shall be an “Event of Default” hereunder:
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(1)
|
if the Tenant shall default in the payment when due of any installment of fixed rent or any item of additional rent when same shall be due and such default shall continue for a period of five (5) business days after notice from the Landlord; provided, however, that the Tenant shall be entitled to receive from the Landlord no more than three (3) such notices in any twelve (12) month period; or
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(2)
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Intentionally omitted.
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(3)
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If the premises shall be abandoned or deserted; or
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(4)
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If a Bankruptcy Event shall occur; or
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(5)
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Intentionally omitted
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(6)
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If the Tenant’s interest or any portion thereof in this lease shall devolve upon or pass to any person, whether by operation of law or otherwise, except as expressly permitted by Article SEVENTEEN hereof; or
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(7)
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Intentionally omitted
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(8)
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If the Tenant’s obligations under this lease have been guaranteed by any party and if the guarantor shall default in the observance or performance of any of the terms of the guaranty or if the guarantor shall repudiate the guaranty, or if the guaranty shall terminate or be terminated for any reason without the prior written consent of the Landlord or in accordance with the terms therof; or
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(9)
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If the Tenant shall default in the observance or performance of any other term, covenant or condition of this lease and the Tenant shall fail to remedy such default within twenty (20) days after notice from the Landlord to the Tenant of such default, except that if the default is of such a nature that it cannot with due diligence be remedied within such twenty-day period, the Tenant shall not be in default if the Tenant shall commence within said twenty-day period and thereafter diligently proceed to complete all steps necessary to remedy such default, and further, so long as the extension of such cure period shall not (i) subject the Landlord or any superior lessor or mortgagee to prosecution for a crime or any other fine or charge, (ii) subject the premises, the building or the land upon which the building is located to being condemned or vacated, (iii) subject the land or the building to any lien or encumbrance, or (iv) result in the termination of any superior lease or mortgage (so long as Tenant has been notified in the notice of default that its failure to remedy such default may result in such termination).
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(b) |
If an Event of Default shall occur, the Landlord may, at any time thereafter and at its option, give the Tenant ten (10) days written notice of its intention to terminate this lease, and in such event, on the tenth day following the giving of such notice, this lease and the term and all rights of the Tenant under this lease shall expire and terminate as if that were the Expiration Date and the Tenant shall immediately quit and surrender the premises, but the Tenant shall nonetheless be liable for all of its obligations hereunder, as provided for in Article TWENTY-SIX.
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(c) |
Notwithstanding the foregoing, if such termination is stayed by order of any court having jurisdiction over any proceeding which constitutes a Bankruptcy Event or by federal or state statute, then, following the expiration of any such stay, or if the trustee appointed in any such proceeding, the Tenant or the Tenant as debtor-in-possession shall fail to assume the Tenant’s obligations under this lease within the period proved therefore by law or within one hundred twenty (120) days after entry of the order for relief or as may by allowed by the court, or if the trustee, the Tenant or the Tenant as debtor-in-possession shall fail to provide adequate assurance of the complete and continuous future performance of the Tenant’s obligations under this lease as provided in Article SEVENTEEN (o), the Landlord, to the extent permitted by law or by leave of the court having jurisdiction over the proceeding constituting the Bankruptcy Event, shall have the right, as its election, to terminate this lease on five (5) days notice to the Tenant, the Tenant as debtor-in-possession or said trustee and upon the expiration of said five (5) day period this lease shall cease and expire as aforesaid the Tenant, the Tenant as debtor-in-possession shall immediately quite and surrender the premises as aforesaid.
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(d) |
If an Event of Default described in clause (a)(1) shall occur, or if this lease shall be terminated in accordance with the provisions of clauses (b) and (c) above, the Landlord, without notice, may reenter and repossess the premises without being liable to indictment, prosecution or damages therefore and may dispossess the Tenant by summary proceedings or otherwise.
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(e) |
If an Event of Default shall occur prior to the date fixed as the commencement of any renewal or extension of this lease, the Landlord may cancel and terminate such right of renewal or extension by written notice to the Tenant.
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(a) |
If an Event of Default shall occur and if this lease shall be terminated as provided in Article TWENTY-FIVE:
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(i)
|
The Landlord and its agents may immediately, or at any time thereafter, re-enter the premises and remove all persons and property therefrom, either by summary dispossess proceedings, or by any suitable action or proceeding at law, without being liable to indictment, prosecution or damages therefore, and repossess and enjoy the premises, together with all additions, alterations, installations and improvements, and no entry by the Landlord shall be deemed an acceptance of surrender.
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(ii)
|
The Landlord may, at its option, re-let the premises in whole or in part, for such term or terms and for such rentals and upon such other conditions, which may include concessions and free rent periods as the Landlord, in its sole discretion, determine, even though the same may extend beyond the Expiration Date. The Landlord shall have no liability to the Tenant to re-let the premises and the failure or refusal or the Landlord to re-let the premises or any part thereof, or if the premises are re-let, the failure of the Landlord to collect the rent under such re-letting, shall not relive the Tenant of any liability under this lease. The Landlord may, at its option, make such repairs, replacements, alterations, additions, improvements and other physical changes in and to the premises as the Landlord, in its sole discretion, considers advisable or necessary in connection with any such re-letting. Any such re-letting shall, as the Landlord’s option, be either for the Landlord’s own account or as the agent for the tenant.
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(b) |
The Tenant, on its behalf and on behalf of all persons claiming through or under the Tenant, including all creditors, hereby expressly waives (i) any and all right to regain possession of the premises or to reinstate or redeem this lease under any present or future law and (ii) any and all rights of redemption and all other rights to regain possession or to reinstate this lease, after (x) the Tenant shall have been dispossessed by a judgment or by warrant of any court or judge, or (y) and re-entry by the Landlord, or (z) any expiration or termination of this lease, whether such dispossess, re-entry, expiration or termination shall be by operation of law or pursuant to the provisions of this lease. Except as otherwise provided by law, the Tenant waives and will waive all right to trial by jury in any summary proceedings and in any other proceeding or action at law hereafter instituted by the Landlord against the Tenant in respect of this lease, the Tenant agrees not to interpose any counterclaim of whatever nature or description in any such action or proceeding. The words re-enter and re-entry as used in the lease are not restricted to their technical legal meaning. In the event of a breach or threatened breach by the Tenant, or anyone claiming by, through or under the Tenant, of any of the covenants or provisions hereof, the Landlord shall have the right to obtain an injunction and the right to invoke any remedy allowed at law or in equity as if re-entry, summary proceedings and other remedies were not herein provided for. The remedies set forth herein are cumulative and the mention in the lease of any remedy shall not preclude the Landlord from exercising any other remedy allowed at law or inequity.
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(c) |
If this lease and the term shall expire as provided in Article TWENTY-FIVE, or by or under any summary proceeding or any other action or proceeding by the Landlord against the Tenant or any person claiming by, through or under the Tenant, or if the Landlord shall re-enter the premises as provided in paragraph (a) above, or by or under any summary proceeding or any other action or proceeding, then, in any of said events:
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(i)
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The Tenant shall pay to the Landlord all fixed rent and additional rent and other charges payable under this lease by the Tenant to the landlord to the date upon which this lease the term shall have expired or has been terminated by the Landlord;
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(ii)
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The Tenant shall also be liable for an shall pay to the Landlord, as liquidated damages, any deficiency (the “Deficiency”) between the fixed rent and additional rent reserved in this lease for the period which would have constituted the unexpired portion of the term (including any renewal term exercised by the Tenant prior to the termination of this lease or re-entry by the Landlord, and in such case the additional rent for the renewal term shall be assumed to be the same as was payable for the year immediately preceding such termination or re-entry) and the net amount, if any, actually received by the Landlord from any re-letting of the premises pursuant to paragraph (a)(ii) above. The Landlord shall be entitled to deduct from the rentals actually collected under any re-letting all of the expense which Landlord incurred by reason of the Tenant’s default and in connection with such re-entry and re-letting, including, but not limited to, all repossession costs, legal expenses, brokerage commissions, attorney’s fees, court costs and disbursements, the cost of repairs, redecoration and alterations in preparing the premises for re-letting, and the amount of rent concessions and work allowances and the like granted in connection with such re-letting. The Deficiency shall be paid in monthly installments by the Tenant on the days specified in this lease for payment of installments of fixed rent, and the Tenant shall not be entitled to withhold any such payment until the Expiration Date set forth in this lease. The Landlord shall be entitled to recover from the Tenant each monthly Deficiency as the same arises and no suit to collect the amount of deficiency for any month shall prejudice the Landlord’s right to collect the Deficiency for any subsequent month by a similar proceeding.
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(d) |
The liability of the Tenant shall survive the issuance of a final order and warrant of dispossess, and re-entry by the Landlord, and any other termination of this lease as a result of an Event of Default, and the granting by the Landlord of a new lease upon the premises to another tenant and the Tenant hereby waives any defense which might be predicated upon any of said acts or events. If the premises are re-let together with any other space in the building, the rental collected and the expenses incurred in connection with such re-letting shall be apportioned as reasonably determined by the Landlord. In no event shall the Tenant be entitled to receive any rents collected or payable under any re-letting, whether or not such rents exceed the fixed rent reserved under this lease. Nothing contained in Articles TWENTY-FIVE or TWENTY-SIX shall be deemed to limit or preclude the recovery by the Landlord from the Tenant of the maximum amount allowed to be obtained as damages by any statute or rule of law, or any sums or damages to which the Landlord may be entitled in addition to the damages set forth in paragraph (c) above.
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Upon the expiration or any termination of the term of this lease, the Tenant shall quit and surrender the premises, together with any fixtures, equipment or appurtenances installed in the premises at the commencement of this lease, and any alterations, decorations, additions and improvements which are not to be removed in compliance with the provisions of Article FOUR hereof, to the Landlord, in good order and condition, ordinary wear and tear and damage by casualty and condemnation excepted. The Tenant shall remove all its furnishings, trade, fixtures, stock in trade and like personal property in accord with the requirements of Article FOUR, so as to leave the premises broom-clean and in an orderly condition. If the last day of the term of this lease falls on Saturday or Sunday, this lease shall expire on the business day immediately preceding. The Tenant’s obligation to observe and perform this covenant shall survive the expiration or other termination of the term of this lease. The Tenant acknowledges that possession of the premises must be surrendered to the Landlord on the Expiration Date. The parties recognize that the damage to the Landlord resulting from any failure by the Tenant to timely surrender possession of the premises will be substantial, will exceed the amount of the monthly installments of the fixed rent and additional rent payable hereunder and will be impossible to accurately measure. The Tenant agrees that if possession of the premises is not delivered to the Landlord on the Expiration Date (or any sooner termination date), in addition to any other rights or remedies the Landlord may have hereunder or in equity or at law, and without in any manner limiting the Landlord’s right to demonstrate and collect any damages suffered by the Landlord, the Tenant shall pay to the Landlord on account of use and occupancy of the premises for each month and for each portion of any month during which the Tenant holds over in the premises after the Expiration Date, a sum equal to two (2) times the aggregate of the fixed rent and additional rent which was payable under this lease during the last month of the term. In addition, and without in any manner limiting the Landlord’s right to demonstrate and collect any damages suffered by the Landlord and arising from the Tenant’s failure to surrender the premises as provided herein, the Tenant shall indemnify and hold the Landlord harmless from and against all cost, liability, damages and expenses (including, without limitation, reasonable attorneys’ fees and disbursements) resulting from delay by the Tenant in so surrendering the premises. In the even the Tenant shall holdover or remain in possession of any portion of the premises for more than ninety (90) days after the Expiration Date or the earlier termination of this lease, the Tenant shall also indemnify the Landlord from and against any consequential damages incurred by the Landlord, as a result thereof, including, without limitation, any claims made by any succeeding or prospective tenant as a result of such delay. Nothing herein contained shall be deemed to permit the Tenant to retain possession of the premises after the Expiration Date (or sooner termination) of this lease or to limit in any manner the Landlord’s right to regain possession of the premises through summary proceedings, or otherwise, and no acceptance by the Landlord of payments from the Tenant after the Expiration Date shall be deemed to be other than on account of the amount to be paid by the Tenant in accordance with the provisions of this Article. The provisions of this Article shall survive the expiration of the term of this lease.
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The Landlord covenants that, if the Tenant shall duly keep and perform all the terms and conditions hereof, the Tenant shall peaceably and quietly have, hold and enjoy the premises for the term aforesaid, free from interference from the Landlord or anyone claiming, by through or under the Landlord, subject however to ground leases, underlying leases and mortgages as hereinbefore described, and to the lien, rights and estate by virtue of unpaid taxes of any government having jurisdiction of the premises of which the herein premises are a part.
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(a) The Tenant has deposited with the Landlord the sum of Three Hundred Fifty Thousand and 00/100 Dollars ($350,000.00) to secure the faithful performance by the Tenant of all the terms, conditions, covenants and agreements of this lease, and to make good to the Landlord any damage which it may sustain by reason of any act or omission of the Tenant. The Landlord shall segregate the said security deposit as a trust fund in an interest-bearing account no to be mingled with other funds of the Landlord, and if, during the term of this lease, the Landlord shall sell, exchange or lease the entire building, subject to this lease, or being the lessee thereof, shall assign its lease, the Landlord shall have the right to pay or transfer the said deposit to such grantee, lessee, or assignee, as the case may be, and, provided the grantee expressly assumes the Landlord’s obligation to hold, apply and return the security deposit in accordance with the terms of this lease, the Landlord shall be released from all responsibility and liability in connection therewith, and the Tenant will look solely to said grantee, lessee, or assignee for its return. If the aforesaid security deposit shall be deposited with a bank or trust company, savings bank or savings and loan association, the Landlord shall advise the Tenant of the name and address thereof. The Tenant shall be entitled to the payment of any interest on the aforesaid security deposit if earned and any interest earned upon such deposit less the amount equal to 1% of the deposit, to which the Landlord shall be entitled as administration expense shall be paid to the Tenant annually. The Tenant’s interest in said deposit shall not be assigned or encumbered without the written consent of the Landlord and neither the Landlord nor its successors or assigns shall be bound by any such attempted assignment or attempted encumbrance, and within thirty (30) days after the expiration of the term, the amount of said deposit shall be repaid to the Tenant, less any proper charges against the same, as hereinabove or hereinafter provided. If the Tenant shall at any time be in default beyond the expiration of applicable notice and cure periods with respect to any payment of rent or of additional rent or of any other payment due from the Tenant to the Landlord under this lease, the Landlord may apply such portion of said deposit as may be adequate to cure such default, including but not by way of limitation, interest, costs, fees and other expenses, paid or incurred by the Landlord pursuant to this lease, and thereafter such portion so applied shall be free from any claim by the Tenant for its return. If the Landlord shall re-enter, pursuant to the provisions of this lease (other than in the even of insolvency in which event the provisions of Article TEWENTY-THREE of the lease shall apply), and shall re-let the premises for its own account, the entire said deposit shall immediately be and become the absolute property of the Landlord, as fixed, liquidated and agreed damages, an not as a penalty, it being impossible in such event to ascertain the exact amount of the damage which the Landlord may thus sustain, but unless the Landlord shall so re-let the premises for its own account, the Landlord shall continue to hold the said deposit, as security for the performance of the Tenant’s obligations, until the date herein expressly fixed for the expiration of the term, and apply the same from time to time to the unpaid obligations of the Tenant, under the same terms and conditions as if the said lease were still in force and effect. No termination of this lease or re-entry by the Landlord for default of the tenant shall entitle the Tenant to the return of any part of said deposit, nor shall the retention of such deposit, after such re-entry, impair or otherwise affect the Tenant’s liability to the Landlord during the balance of the term originally provided for. If, at any time, the said deposit shall be diminished, by reason of the Landlord’s having applied any part thereof in accordance with the provisions of this paragraph, the Tenant shall pay over to the Landlord upon demand, the equivalent of such decrease, to be added to said deposit and to be held and applied in accordance with the provisions of this paragraph. Upon the twelfth month anniversary of the Commencement Date, and on each anniversary of the Commencement Date, and further provided that, as of any such date, no Event of Default then outstanding hereunder, the amount of the security deposit to be held by the Landlord pursuant to this Article shall be reduced to the amount indicated:
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Anniversary of the
Commencement Date
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Amount of Security Deposit
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1st Anniversary
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$ | 300,000 | ||
2nd Anniversary
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$ | 250,000 | ||
3rd Anniversary
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$ | 200,000 | ||
4th Anniversary
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$ | 150,000 | ||
5th Anniversary
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$ | 100,000 |
(b) In lieu of delivering cash as the security deposit, the Tenant may deliver to the Landlord an unconditional, irrevocable and transferable letter of credit (such letter of credit or any extension or replacement thereof, being hereinafter referred to as the “Letter of Credit”) issued for the account of the Landlord by a New York Clearing House bank reasonably acceptable to the Landlord, in substance satisfactory to the Landlord, which Letter of Credit is to be held by Landlord in accordance with the terms of this Article TWENTY-NINE. The Letter of Credit shall permit the Landlord or its duly authorized representative (1) to draw thereon up to the full amount of the credit evidenced thereby upon presentation of the Letter of Credit and a sight draft in the amount to be drawn and (2) to draw the full amount thereof to be held as cash security pursuant to this Article if for any reason the Letter of Credit is not renewed within forty five (45) days prior to its expiration date. The Letter of Credit shall be fully transferable by the Landlord and its successors and assigns without charge to the Landlord. In the event that the expiration date of the Letter of Credit is prior to forty five (45) days after the Expiration Date (or forty five days after any subsequent date through which the term of this lease may be extended), if the Landlord received notice from the bank or the Tenant that the Letter of Credit is not being renewed or in the event that the Tenant has not delivered a replacement cash security deposit or Letter of Credit to the Landlord by thirty (30) days before the expiration of the Letter of Credit, then the Landlord, acting through one of its duly authorized representatives shall be entitled to present the Letter of Credit for immediate payment of the then potential amount available pursuant to the Letter of Credit, and the amount of the Letter of Credit shall become the Deposit hereunder and shall be held, applied and returned by the Landlord in accordance with the terms provided by the lease for the holding, application and return of the Deposit. If the Letter of Credit is not being renewed but the Tenant does deliver a replacement Deposit or a similar Letter of Credit by thirty (30) days before expiration of the Letter of Credit, then the Landlord shall not thereafter be entitled to present the expiring Letter of Credit for payment of any amounts. The Landlord shall reasonably cooperate with the Tenant in substituting a Letter of Credit in order to effectuate the reductions in the security deposit contemplated in paragraph (a) above, provided, however, that in no event shall the Landlord be obligated to relinquish possession of a Letter of Credit until it has received a valid replacement thereof in accordance with the terms of this lease.
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(a) Real Estate Tax and CPI Escalation. In order to adjust, during the term of this lease, for increases (i) in the expenses of the Landlord for Real Estate Taxes, the Tenant shall pay to the Landlord, as additional rent, Tenant’s Proportionate Share of any increases in such Real Estate Taxes, and (ii) in operating expenses incurred by the Landlord, the Tenant shall pay to the Landlord, as additional rent, the amount by which the fixed rent is increased by reason of increases in the Index over the Base Index, both computed in the manner set forth in this Article.
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(b) Definition. As used in this Article, the following capitalized words or expressions shall have the meanings ascribed to them below:
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1. “Real Estate Taxes” shall mean the aggregate amount of real estate taxes and any general or special assessments (exclusive of interest and penalties thereon) imposed upon the building and the land upon which it is located (collectively, the “Property”), by Federal, State or local government, including, without limitation, (i) assessments made upon or with respect to any “air” or “development” rights now or hereafter affecting the Property, (ii) any fee, tax or charge imposed by any governmental authority for any vaults or vault space within or outside the boundaries of the Property, (iii) any expenditures for fees and expenses incurred by the Landlord in connection with any action or proceeding to reduce the assessed valuation of the Property, and (iv) any taxes or assessments levied after the date of this lease in whole or in part for public benefits to the Property, including, without limitation, any Business Improvement District taxes and assessments; without taking into account any discount that the Landlord may receive by virtue of any early payment of Real Estate Taxes. If because of any change in the taxation of real estate, any other tax or assessment, however denominated (including, without limitation, any franchise, income, profit, sales, use, occupancy, gross receipts or rental tax) is imposed upon the Landlord or owner of the Property, or the occupancy, rents or income therefrom, in substitution for any of the foregoing Real Estate Taxes, such other tax or assessment shall be deemed part of Real Estate Taxes computed as if the Landlord’s sole asset were the Property. Anything to the contrary notwithstanding, Real Estate Taxes shall not include (w) any taxes in the Landlord’s income, (x) franchise taxes, (y) estate or inheritance taxes or (z) any similar taxes, imposed on the Landlord, unless such taxes are levied, assessed or imposed in lieu of or as a substitute for the whole or any part of the taxes, assessments, levies or impositions which now constitute Real Estate Taxes. If, by law, any assessment may be paid in installments, then, for the purposes herof, (i) such assessment shall be deemed to have been payable in the maximum number of installments permitted by law and (ii) there shall be included in Real Estate Taxes for each subsequent Tax Year in which such installments may be paid, the installments of such assessments so becoming payable during such subsequent Tax Year, together with any interest thereon payable during such subsequent Tax Year.
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2. “Base Rent” shall mean an amount equal to the then applicable fixed rent set forth in Article One of the lease.
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3. “Base Year” shall mean the New York City fiscal year commencing July 1, 1999 and ending June 30, 2000.
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4. “Base Taxes” shall mean the Real Estate Taxes payable during the Base Year.
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5. “Tax Year” shall mean the twelve month period following the Base Year and each succeeding twelve month period thereafter, any portion of which occurs during the term of this lease.
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6. “Tax Statement” shall mean statement setting forth a comparison of the Real Estate Taxes for a Tax Year with the Base Taxes.
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7. “Tenants Proportionate Share” shall mean 100%.
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8. “Index” shall mean the “Consumer Price Index for All Urban Consumers (1982/84=100)” specified for “All Items”, relating to New York, NY – Northern NJ Area, published by the Bureau of Labor Statistics of the Unites States Department of Labor, or any successor index thereto, appropriately adjusted. In the event the Index shall hereafter be converted to a different standard reference base or otherwise revised, the determination of the CPI Adjustment shall be made on the basis of such conversion factor, formula or table for converting the Index as may be published by the Bureau of Labor Statistics, or, if said Bureau shall not publish the same, then wit the use of such conversion factor, formula or table as may be published by Prentice-Hall, Inc., or failing such publication, by any other nationally recognized publisher of similar statistical information. In the even either Index shall cease to be published, and there is no successor thereto, then, for the purposes of this Article, there shall be substituted for the Index uch other index as the Landlord and Tenant shall reasonably agree upon, and, if they are unable to agree within ninety (90) days after the Index ceases to be published, such matter shall be determined in New York City by arbitration in accordance with the Rules of the American Arbitration Association, for the sole purpose of determining the appropriate index and any appropriate conversion factor.
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9. “Base Index” shall mean the Index as last published prior to January 1, 2000.
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10. “Computation Date” shall mean January 1, 2001, and the anniversary of such date in each succeeding calendar year, any portion of which occurs during the term of this lease.
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11. “Comparison Year” shall mean the twelve month period commencing with the initial Computation Date and each succeeding twelve month period thereafter.
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12. “CPI Adjustment” shall mean the amount obtained by multiplying the Base Rent by the percentage by which the Index as published as of the date immediately preceding the Computation Date in each Comparison Year exceeds the Base Index, provided, however, that if the percentage increase in the Index during any Comparison Year is less than 2 ½%, then in calculating the CPI Adjustment with respect to such Comparison Year (whether in such Comparison Year or in a subsequent Comparison Year), the percentage increase for such Comparison Year shall be deemed to have been 2 ½%, and, in no event shall the percentage increase for any Comparison Year exceed 6%.
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(c) Real Estate Taxes. (1) If the Real Estate Taxes for any Tax Year exceed the Base Taxes, the Tenant shall pay, as additional rent, an amount equal to Tenant’s Proportionate Share of such increase (the “Tax Payment”), which amount shall be payable as hereinafter set forth.
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(2) At any time during or after the term, the Landlord may render to the Tenant a Tax Statement showing the amount of the Tax Payment due from the Tenant. On the first day of the month following the delivery of a Tax Statement to the Tenant, the Tenant shall pay to the Landlord a sum equal to one-twelfth (1/12th) of the Tax Payment shown to be due for such Tax year multiplied by the number of months (and any fraction thereof) of the term of the lease then elapsed since the commencement of such Tax Year. The Tenant shall continue to pay to the Landlord a sum equal to one twelfth (1/12) of the Tax Payment shown on such Tax Statement on the first day of each succeeding month until the first day of the month following the month in which the Landlord delivers a new Tax Statement to the Tenant. Promptly after delivery of a Tax Statement to the Tenant, the Landlord shall give notice to the Tenant stating whether the amount previously paid by the tenant to the Landlord for the current Tax Year was greater or less than the installments of the Tax Payment to be paid for the current Tax Year in accordance with the Tax Statement. If there was a deficiency, the Tenant shall pay the amount of such deficiency as additional rent in accordance with the provisions of Article One hereof. If there shall have been an overpayment, the Landlord shall credit the amount thereof against the next monthly installments of additional rent payable in accordance with the provisions of this Article Thirty. Tax Payments shall be collectible by the Landlord in the same manner as fixed rent. The Landlord’s right to render a Tax Statement during or with respect to any subsequent Tax Year, and shall not eliminate or reduce the Tenant’s obligation to make a Tax Payment for such Tax Year.
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(d) CPI Escalation. (1) At any time during or after each Comparison Year, the Landlord may render a statement to the Tenant showing the amount of the CPI Adjustment due from the Tenant for such Comparison Year (the “CPI Statement”), which amount shall be payable as hereinafter set forth.
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(2) On the first day of the month following the delivery of a CPI Statement to the Tenants, the Tenant shall pay to the Landlord a sum equal to one-twelfth (1/12th) of the CPI Adjustment shown on such CPI statement on the first day of each succeeding month until the first day of the month following the month in which the Landlord delivers a new CPI Statement to the Tenant. Promptly after delivery of a CPI Statement to the Tenant, the Landlord shall give notice to the Tenant stating whether the amount previously paid by the Tenant to the Landlord for such Comparison Year was greater or less than the installments of the CPI Adjustment paid by the Tenant for such Comparison Year. If there was a deficiency, the Tenant shall pay the amount of such deficiency as additional rent in accordance with the provisions of Article One hereof. The CPI Adjustment shall be collectible by the Landlord in the same manner as fixed rent. The Landlord’s failure to render a CPI Statement shall not prejudice the Landlord’s right to render a CPI Statement during or with respect to any subsequent Comparison Year, and shall not eliminate or reduce the Tenant’s obligation to pay the CPI Adjustment for such Comparison Year. For illustration purposes only, assume a Base Rent of $10,000 and a Base Index of 100. If the Computation Date is March 1999, and the Index as of the date immediately preceding the Computation Date is 115, the CPI Adjustment for the Comparison Year commencing March 1, 1999 and ending February 29, 2000 is $1,500, payable in equal monthly installments of $125 ($10,000 times the percentage increase in the Index as of the Computation Date, 115, over the Base Index of 100). The Tenant would continue to pay the $125 monthly payment until the next CPI Statement is rendered. If the CPI Statement for the comparison Year commencing March 1, 2000 and ending February 28, 2001 is rendered in June 2000 and shows a monthly CPI Adjustment payment of $150 for that Comparison Year, the Tenant shall pay a monthly payment of $150 for June, 2000, together with a deficiency payment of $45 (3 months times the $25 monthly deficiency), and thereafter shall pay the monthly CPI Adjustment payment of $150 until a new CPI Statement is rendered.
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(e) Statements Every Tax Statement and CPI Statement furnished by the Landlord pursuant to this Article shall be conclusive and binding upon the ?Tenant unless within ninety days following the receipt of the Statement in question, the Tenant shall notify the Landlord that it disputes the correctness thereof, specifying the particular respects in which the Statement is claimed to be incorrect. If such dispute shall not have been settled by agreement within one hundred twenty days after receipt of the disputed Statement, the dispute shall be submitted to arbitration in New York City in accordance with the rules then obtaining the American Arbitration Association. Each party shall bear its own costs in connection with such arbitration. Pending the determination of such dispute by agreement or arbitration as aforesaid, the Tenant shall pay the additional rent in accordance with the disputed Tax Statement or CPI Statement, as the case may be. If the dispute shall be settled in the Tenant’s favor, the Landlord shall, at its potion, promptly refund to the Tenant the amount of the Tenant’s overpayment, or credit the amount of such overpayment against the installments of fixed and additional rent next becoming due and payable under this lease. Upon request, the Tenant shall receive a copy of the tax bill upon which a Tax Statement has been based.
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(f) Inspection of Books. If the Tenant timely notifies the Landlord that it disputes the correctness of a Tax Statement, the Landlord, upon written request of the Tenant, shall provide the Tenant and/or the Tenant’s independent certified accountants, reasonable access to review the Landlord’s books and records applicable to the building for the Tax Year in question, solely for the purpose of verifying the information contained in the Tax Statement. Such examination shall be made during the Landlord’s regular business hours at the office of the landlord. The tenant recognized the confidential nature of such records and agrees to maintain the information obtained from such examination in strict confidence.
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(g) Decreases in Real Estate Taxes or Index. In no event shall any decrease in the Real Estate Taxes or the Index in any way reduce the fixed rent or additional rent payable by the Tenant under this lease, except to the extent to which any such decrease shall result in a decrease in the additional rent payable pursuant to this Article; provided, however, that no decrease in Real Estate Taxes shall in any way reduce the additional rent payable on account of the CPI Adjustment, and that no decrease in the amount of the CPI Adjustment shall in any way reduce the additional rent payable on account of the CPI Adjustment, and that no decrease in the amount of the CPI Adjustment shall in any way reduce any additional rent payable on account of any increase in Real Estate Taxes.
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(h) Expiration or Termination of Lease. The expiration or termination of this lease during any Tax Year or Comparison Year shall not affect the rights or obligations of the parties hereto respecting any payments of Tax payments for such Tax Year and any payments for CPI Adjustment for such Comparison Year. Any Tax Statement relating to such Tax Year and any CPI Statement relating to such Comparison Year may be sent to the Tenant subsequent to, and all such rights and obligations shall survive, any such expiration or termination. In determining the amount of the Tax Payment for the Tax Year or the CPI Adjustment for the Comparison Year in which the term of the lease shall expire, the payment of the relevant escalation shall be prorated based on the number of days of the term which fall within such Tax Year or Comparison Year, as the case may be. Any payments due under such Tax Statement, or CPI Statement shall be payable within ten (10) days after such Tax Statement or CPI Statement, as the case may be, is sent to the Tenant.
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(a) The Landlord shall have no obligation to provide elevator service to the premises. If the Landlord converts the freight elevator currently located in the building to an automatic passenger elevator, the Tenant shall be entitled to use the elevator. The parties acknowledge that the Landlord is not obligated to perform such conversion or to install a new elevator.
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(b) The Landlord shall provide steam heat for the premises from the public utility servicing the building, and the Tenant shall reimburse the landlord for all costs for such steam heat within ten days after presentation of a demand therefore.
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(c) The Landlord shall not be obligated to provide any cleaning services in the premises. The Tenant shall keep the premises in order and shall cause them to be cleaned on a regular basis by a cleaning contract reasonably approved by the Landlord. The Tenant shall, at its sole cost and expense, comply with all present and future laws, ordinances, regulations and requirements of the City, State or Federal Government or any agency having jurisdiction over the building, or any rules which the Landlord may reasonably impose, with respect to the recycling or sorting of refuse and rubbish. The Tenant shall indemnify the Landlord for all liability arising from the Tenant’s failure to comply with the provisions of this Article. The Tenant shall keep all windows on the premises clean in accordance with all of Landlord’s rules and Regulations, and Landlord shall have no obligation to keep the interior or exterior of such windows clean.
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(d) The landlord shall furnish cold water for ordinary lavatory use so long as the premises are used only for the permitted uses. The Tenant will, at its own expense, hat the cold water supplied by the Landlord in order to furnish hot water for lavatory or office uses. If the Tenant uses or consumes water for any other purposes or in unusual quantities (of which fact the landlord shall be the sole judge), the Landlord may, at the Tenant’s expense, install a water meter or require the Tenant to install a meter. The Tenant shall thereafter maintain the meter in good working order at the Tenant’s expense and the Tenant shall pay for water consumed as shown on said meter as addition rent as and when bills are rendered at 110% of the Landlord’s cost therefore. In default in making such payment the Landlord may pay such charges and collect the same from the Tenant. The Tenant shall pay the New York City sewer rents, charges or any other tax apportioned to the Tenant’s metered consumption of water at the premises (to the extent such charges have not otherwise been included in the computation of Real Estate Taxes). The apportionment of the sewer rent to the premises shall be made in accord with the measurement or apportionment of water consumed at the premises as provided herein. The sewer rents shall be billed with the water charges and shall constitute additional rent.
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(e) The Landlord may suspend any service which it is required to provide hereunder, if it should become necessary or proper so to do, at any time. The Landlord shall restore such service within a reasonable time, making due allowance for labor troubles, acts of God, or any cause beyond the Landlord’s control.
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(a) The Tenant shall obtain and keep in full force and effect during the term of this lease, at the Tenant’s sole cost and expense, (i) a policy of comprehensive general public liability and property damage insurance on an occurrence basis, with a broad form contractual liability limit with respect tto each occurrence in an amount of not less than $3,000,000 for injury (or death) to persons and damage to property; (ii) an “all risk” insurance policy, with extended coverage, covering all fo Tenant’s personal property and alterations for 100% of the replacement cost thereof, as well as business interruption insurance adequate to cover the Tenant’s loss of income as a result of a loss sustained by a peril covered under the policy; and (iii) Worker’s Compensation Insurance, as required by law. Such policies shall provide that the Tenant is named as the insured. Landlord and any managing agent, lessors and mortgagees (whose names have been furnished to the Tenant) shall be named as additional insureds, as their respective interests may appear. The Tenant shall have the right to insure and maintain the insurance coverages required under this article under blanket insurance policies covering other premises occupied by the Tenant so long as such blanket policies comply as to terms and amounts with the requirements set forth in this Article; provided that, upon request, the Tenant shall deliver to the landlord a certificate from the Tenant’s insurer evidencing the portion of such blanket insurance allocable to the premises.
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(b) All insurance required to be carried by Tenant hereunder shall be written in form and substance reasonably satisfactory to the Landlord and issued by a reputable and independent insurer permitted to do business in the State of New York, and rated in Best’s insurance Guide (or any successor thereto) as having a general policyholder rating of not less than “A” and a financial rating of at least “X”. The policy required to be carried pursuant to paragraph (a) (i) above shall contain a provision that (1) the policy shall be non-cancelable with respect to the Landlord and such managing agents, lessors and mortgagees 9whose names and addresses have been furnished to the Tenant) unless thirty (30) days’ prior written notice shall be given to the Landlord by certified mail, return receipt requested, which notice shall contain the policy number and the name of the insured and additional insureds, and (2) no act or omission of the Tenant shall affect or limit the obligation of the insurer to pay the amount of any loss sustained. Certificates of Insurance (including endorsements and evidence of the waivers of subrogation required pursuant to Article SIXTEEN hereof), or evidence of renewal of such coverage, shall be delivered to the landlord prior to the Commencement Date (or any earlier entry upon the premises by the Tenant or any of the Tenant’s employees, agents or contractors prior to the Commencement Date), and at least thirty (30) days prior to the expiration of such policy. If the Tenant fails to obtain or keep in force the insurance required by this Article, or to pay the premiums thereof, provided the Tenant is afforded written notice of the landlord’s intention to pay such premium ten (10) days prior thereto, in addition to all other rights the Landlord may have under this lease, the landlord may, form time to time, and as often as such failure shall occur, pay the premiums therefore, and any and all sums so paid for insurance by the Landlord shall be and become, and are hereby declared to be, additional rent under this lease and shall be due and payable on demand.
|
(a) The Tenant agrees that the value of the premises and the building of which the premises form a part and the reputation of the Landlord will be seriously injured if the premises are used for any obscene or pornographic purposes or any sort of commercial sex establishment. The Tenant covenants and agrees not to sell, display or post, or knowingly allow to be sold, displayed or posted any obscene or pornographic material on the premises. The Tenant agrees that iif at any time the Tenant violates any of the provisions of this Article, such violation shall be deemed a breach of a substantial obligation of the terms of this lease.
|
(b) The Tenant covenants and agrees that during the term of this lease, it will not use the premises or any part thereof, or permit the premises or any part thereof to be used (1) for banking, trust company or safe deposit business; (2) as or by a commercial or savings bank, a trust company, a savings and loan association, a loan company, or a credit union; (3) for the sale of travelers checks, money orders and/or foreign exchange; (4) aw a restaurant and/or bar and/or for the sale of beverages and/or sandwiches and /or ice cream and/or baked goods; (5) by the United States Government, the City or State of New York, any foreign government, the United Nations or any agency or department of any of the foregoing or an other person or entity having sovereign or diplomatic immunity; (6) as an employment agency, search firm or similar enterprise, school or vocational training center (except for the training of employees of the Tenant intended to be employed at the premises); (7) as a barber shop or beauty salon; or (8) as a diagnostic medical center and/or for the practice of medicine.
|
|
(a) This lease contains the entire agreement between the parties and all prior negotiations and agreements are merged into this lease.
|
|
(b) This lease may not be recorded.
|
|
(c) The covenants, conditions and agreements contained in this lease shall bind and inure to the benefit of the Landlord and the Tenant and their respective heirs, executors, administrators, successors and permitted assigns.
|
|
(d) If any term, covenant or provision of this lease, or the application thereof, shall be held invalid or unenforceable, the remainder of this lease, or the application thereof to situations other than that as to which it is invalid or unenforceable, shall not be affected thereby, and each term, covenant and provision shall be valid and enforceable, shall not be affected thereby, and each term, covenant and provision shall be valid and enforceable to the fullest extend permitted by law.
|
|
(e) The submission of this lease for execution by the Tenant shall not be binding upon the Landlord or the Tenant unless and until both the Landlord and the Tenant unless and until both the Landlord and the Tenant have executed and unconditionally delivered a fully executed copy of this lease to each other.
|
|
(f) The captions I this lease are inserted for convenience only and shall not define, limit or describe the scope of the provisions to which any of the apply. The use of any pronoun referring to either of the parties to this lease shall be construed to include any or no gender and any number.
|
|
(g) If the Tenant is a corporation, the person executing this lease on behalf of the Tenant represents and warrants that the Tenant is duly incorporated and, if applicable, is duly qualified and authorized to conduct business in the State of New York, and the person executing this lease on behalf of the Tenant has been duly authorized to do so. The Tenant shall provide the Landlord with a copy of a resolution to this effect, and evidence of its due incorporation and qualification, if applicable, upon request of the Landlord.
|
|
(a) The Initial Improvements for which reimbursement may be sought are the “hard” cost of constructing the Initial Improvements, which costs shall not include any telephone systems, computer systems, furniture and decorations, but may include carpeting, wall coverings, window blinds and telephone and data cabling, provided, however, that up to $87,510 of the Improvement Allowance may be applied toward reimbursement of “soft costs”, including, without limitation, professional fees (including architectural and design costs), and the cost of all permits, licenses and approvals required in connection with the construction and installation of the Initial Improvements.
|
|
(b) The Landlord shall reimburse the Tenant from time to time (but not more often than monthly) for work done in connection with the installation and construction of the Tenant’s Initial improvements, up to an aggregate maximum reimbursement of $583,400.00, within thirty (30) days following receipt of the following:
|
(i)
|
a request for payment of the Improvement Allowance signed by an officer of Tenant, specifying the work for which reimbursement is being sought, which shall be accompanied by a certificate signed by an officer of the Tenant certifying that the payment requested in the invoice has been paid in full and that the Initial Improvements specified therein have been completed substantially in conformance with the plans therefore which were approved by the Landlord and that such work has been completed in good and workmanlike manner;
|
(ii)
|
copies of invoice from the vendors, supplier, or contractor evidencing the amount for which payment or reimbursement is sought, such invoices, if submitted for reimbursement, to be marked “paid in full” by such vendor, supplier or contractor (or, in lieu therof the Landlord shall be furnished other documentation satisfactory to the Landlord evidencing payment in full);
|
(iii)
|
a certificate from the Tenant’s architect stating that (x) such portion of the Initial Improvements for which reimbursement is being sought has been fully completed substantially in accordance with the final plans as approved by the landlord and (y) that such work has been completed in a good and workmanlike condition; and
|
(iv)
|
Lien waivers from each contractor(s) or subcontractor(s) to the extend of the amount to be paid to such parties, which waivers may contain a condition that the effectiveness of such waivers, shall be subject to the payment to the applicable contractor(s) or subcontractor(s) of the amount of the invoice accompanying such waiver. The landlord shall not be obligated to reimburse the tenant for any invoice which is not accompanied by such a waiver.
|
(v)
|
Notwithstanding the foregoing, the Landlord shall retain from each reimbursement hereunder, an amount equal to ten percent (10%) of the amount of the Improvement Allowance then being requested until the Tenant certifies to the Landlord that it has applied for final permits required in connection with the construction of the Initial Improvements by any governmental department or agency having jurisdiction thereof, together with a certificate signed by its architect that all work needed in order to obtain such permits has been completed.
|
|
(c) It is understood and agreed that the Landlord shall have no responsibility for the performance of the contractor installing the Initial Improvements (including matters of quality or timeliness), and in the event that for any reason the Initial Improvements are not completed in a timely fashion and/or there is any delay in the date on which the premises are ready for occupancy by the Tenant for the purposes of conducting business, this lease shall nevertheless continue in full force and effect, and, except in the circumstances set forth below and to the extent set forth below, the Tenant shall have no right, remedy or claim (including any claim for actual, punitive or consequential damages) against the Landlord.
|
|
(d) The Landlord’s maximum liability under this Article shall not exceed $583,400.00. If the actual cost of the Initial Improvements shall exceed the amount of the Improvement Allowance, the entire amount of the excess cost shall be paid solely by the Tenant and the Landlord shall be under no obligation to pay such excess.
|
|
(e) Within thirty (30) days after completion of the Initial Improvements, the Tenant shall deliver to the Landlord general releases and waivers of lien from all contractors, subcontractors and material men involved in the performance of the Initial Improvements and the materials furnished in connection therewith (unless the same were previously furnished pursuant to subparagraph (c)(iv) above), and a certificate from the Tenant’s independent licensed architect certifying that, in its opinion, the Initial Improvements have been performed in a good and workmanlike manner and substantially completed in accordance with the final plans, as approved by the Landlord, where required.
|
|
(f) If Landlord does not pay any portion of the Improvement Allowance within the time specified herein, the Tenant may, on written notice to the Landlord, apply any unpaid amount as a credit toward the fixed and additional rent payable under this lease.
|
THE RECTOR, CHURCH-WARDENS AND VESTRYMEN OF TRINITY CHURCH IN THE CITY OF NEW YORK | |||
By: | |||
Director of Leasing | |||
By: | |||
Executive Vice President of Real Estate | |||
By: | |||
John A. McKegny
|
|||
Finance Department
|
|||
Attest:
|
COMET SYSTEMS, INC.
|
||
As to the Tenant:
|
|||
Nicholas Corman/ Witness
|
By: | ||
James Rosen | |||
Chairman |
1.
|
The Tenant shall not clean, nor require, permit or allow any window in the premises to be cleaned from the outside in violation of Section 202 of the New York State Labor Law or the Rules of the Board of Standards and Appeals, or of any other board or body having or asserting jurisdiction.
|
2.
|
All machinery shall be kept in approved settings sufficient, in the Landlord’s reasonable judgment, to absorb any shock and prevent any noise, vibration, or annoyance in the building of which the premises are a part and, if necessary, shall be provided with oil pans between such machinery and the floor beneath it, sufficient to prevent the seepage of oil on or into the floors.
|
3.
|
During the cold season, the windows shall be kept closed to maintain the temperature of the premises and to prevent any freezing thereof, or of any equipment or appliance therein. If the building contains central air conditioning and ventilation, the Tenant agrees to keep all windows closed at all times and to abide by all reasonable rules and regulations issued by the Landlord with respect to such services. The Tenant shall draw and close any draperies or blinds for the windows of the premises whenever the air-conditioning system is in operation and the position of the sun so requires.
|
4.
|
All trucks, vehicles or conveyances used by the Tenant or others in the delivery or receipt of material in the premises or any other area in the building shall have rubber tires and sideguards. The Tenant shall be responsible for removing any oil deposited on the premises from such trucks, vehicle or conveyances.
|
5.
|
The Tenant shall not alter any lock or install a new or additional lock or bolt on any doors or windows. On termination or expiration of this lease, all keys must be surrendered to the Landlord and in the even t of the loss of any keys furnished at the Landlord’s expense, the Tenant shall pay to the Landlord the cost thereof. If the building has a central security system, the Tenant shall provide the Landlord with all access codes to the premises.
|
6.
|
Intentionally omitted.
|
7.
|
All sanitary facilities, wash closets and plumbing fixtures shall be used only for the purposes for which they were constructed, and no sweepings, rubbish, rags, acids or other substances shall be deposited therein, and the expense of any stoppage or damage resulting from the violation of this rule shall be borne by the Tenant whose employees, agents or visitors caused it.
|
8.
|
No sign or lettering shall be exhibited, inscribed, painted or affixed outside of the premises or on the inside of the premises if the same can be seen from the outside of the premises except as may be approved in writing by the Landlord, except that the name of the Tenant may appear on the entrance door of the premises. The Tenant may install a sign on the façade of the building, subject to the Landlord’s prior approval as to size, location, style and manner of affixation. The Landlord agrees that it shall not unreasonably withhold or delay its consent to the design of a sign displaying the Tenant’s name and logo. The Tenant shall remove the sign upon the expiration of the lease and restore all damage caused by such removal. If the Tenant violates this rule, the Landlord may remove the same without liability and the expenses so incurred by the Landlord shall be paid by the Tenant as additional rent. The Tenant shall not allow noise to emanate from the premises to the street or other portions of the building. Any sign or display which may be installed by the Tenant shall be kept in good order and repair and in a neat and attractive condition. The Landlord reserves the right to use the roof and outside walls surrounding the premises for sign purposes. The Landlord may remove any sign or signs or displays in order to pain the premises or any part of the building, or make any repairs, alterations or improvements in or upon the premises or building, or any part thereof, provided it causes the same to be removed and replaced at the Landlord’s expense, whenever the painting, repairs, alterations or improvement shall have been completed. The Landlord reserves the right to approve the appearance and design of the elevator lobby on the first floor of the building.
|
9.
|
The Landlord shall have the right to prohibit any advertising by the Tenant which refers to the address of the building other than to identify the location of the Tenant’s offices, if, in the Landlord’s reasonable judgment, such advertising tends to impair the reputation of the building or its desirability as an office building, and upon written notice from the Landlord, the Tenant shall refrain from or discontinue such advertising.
|
10.
|
No awnings, antennae, aerials, ventilating and air-conditioning apparatus or other projections shall be attached to the outside walls of the building. No air-conditioning apparatus may be installed in window of the premises.
|
11.
|
The lights, skylights, entrances, passages, courts, elevators, vestibules, stairways, loading platforms, corridors, halls or any part of the building intended for use in common by the tenant with other occupants of the building shall not be obstructed or encumbered by the Tenant or used for any other purpose than for ingress or egress from the premises and for delivery of equipment in a prompt and efficient manner using elevators and passageways designated for such delivery by the Landlord. In the even of any encumbrance or obstruction, the Landlord may remove the material causing such encumbrance or obstruction and cause it to be stored and charge the cost of doing so to the Tenant. Not courtyard or yard appurtenant to the premises or the building shall be used for parking vehicles of any kind. If the premises are on the ground floor of the building, the Tenant shall not place any rubbish on the sidewalk or curb in front of the premises.
|
12.
|
Subject to the provisions of Article FOUR of this lease, no part of the premises or the building shall be marked, painted, bored, drilled into, or in any way defaced. Any drilling which is permitted by the Landlord shall be done in accordance with the provisions of Article FOUR and shall be done during non-business hours unless otherwise authorized by the Landlord in writing. No boring, cutting or stringing of wires shall be permitted, except with the prior written consent of the Landlord. No linoleum or other similar floor covering shall be laid so that the same shall come in direct contact with the floor of the premises; and if such flooring is used, an interlining of builder’s deadening felt or other sound-attenuating materials shall be first affixed to the floor, by a paste or other material, soluble in water. Cements and other similar adhesive material shall not be used. Removal of any alterations, decorations or improvements in compliance with Article FOUR of this lease shall include the removal of all linoleum, lining and adhesive material.
|
13.
|
No part of the premises shall be used in a manner or for a purpose that is substantially objectionable to the Landlord or to another tenant, by reason of noise, odors, vibrations or otherwise, or which in the reasonable judgment of the Landlord might cause structural injury to the building or interfere in any way with other tenants or those having business in the building or create a nuisance. Tenant shall not make, or permit to be made, any unseemly or disturbing noises or disturb or interfere with occupants of this or neighboring buildings or premises or those having business with them whether by the use of any musical instruments, radio, television set, unmusical noise, signing or in any other way.
|
14.
|
The Tenant’s employees, guest and visitors shall not stand or loiter around the lobby, hallways, stairways, elevators, front, roof or any other part of the building used in common by the occupants thereof.
|
15.
|
No load shall be placed upon any floor of the building exceeding the floor load per square foot area which such floor was designed to carry, and all loads shall be evenly distributed. The Landlord reserves the right to reasonably prescribe the weight and placement of all safes, machinery and other personal property in the premises so as to distribute their weight.
|
16.
|
Nothing shall be hung, shaken, thrown out of any window or doors, or down any passages, stairways, elevators, or skylights of the building, nor shall any of them be covered, obstructed, or encumbered. The tenant shall not use, keep or permit to be used any foul or noxious gas or substance in the premises. No bicycles, vehicle or animals (other than seeing-eye dogs), fish or birds shall be kept in the building. Smoking or carrying lighted cigars or cigarettes in the elevators of the building is prohibited.
|
17.
|
Building employees shall not perform any work or do anything outside of their regular duties, unless under special instructions from the office of the Landlord.
|
18.
|
No peddling, soliciting or canvassing shall be permitted in the premises or by the Tenant’s employees elsewhere in the building.
|
19.
|
All deliveries to or from the premises shall be made by means of the freight elevators. The Landlord may reasonably prescribe, and from time to time vary, the time for any removals or deliveries from or to the premises. Removals or deliveries of safes, machinery, business equipment, furniture, freight, and any other heavy or bulky matter shall be done only on the freight elevators and through the service entrances and corridors and shall only be done upon written authorization of the Landlord and only in such manner and by such persons as may be reasonably acceptable to the Landlord, and the Landlord may require any further assurances or agreements or indemnity from the Tenant to the movers to that effect. If any safe, machinery, equipment, bulky matter or fixtures requires special handling, all work in connection therewith shall comply with the Administrative Code of the City of New York and all other laws and regulations applicable thereto. The Landlord reserves the right to inspect all freight to be brought into the building and to exclude from the building all freight which violates any of these Rules and Regulations ro the lease of which these Rules and Regulations are a part.
|
20.
|
Intentionally omitted.
|
21.
|
No Tenant shall operate any elevator in the building, except for automatic self-service elevators.
|
22.
|
The Tenant shall not use any method of heating or air-conditioning other than that supplied or approved by the Landlord.
|
23.
|
If the premises consist of basement space, or if any property of the Tenant is stored in the basement portion of the building, all such property shall, at the Tenant’s own cost and expense, be placed entirely on skids or platforms, which will raise such property at least six inches from the floor. The Landlord shall have no liability for any materials stored in the basement, except for the negligence or willful act of the Landlord.
|
24.
|
If any vending machine dispenses any beverages or other liquids or refrigerates, it shall have a waterproof pan located thereunder, connected to a drain.
|
25.
|
Intentionally omitted.
|
26.
|
The Tenant shall keep the entrance door to the premises closed at all times.
|
27.
|
No space in the building shall be used for manufacturing, for the storage of merchandise, or for the sale of merchandise, goods or property of any kind at auction or otherwise.
|
28.
|
The Tenant shall have the right to its proportionate share of listings in the building’s directory, but in no event less than three listings.
|
29.
|
The Landlord and its agents reserve the right to inspect all packages, boxes, bags, handbags, attaché cases, suitcases, and other items carried into the building, and to refuse entry into the building to any person who either refuses to cooperate with such inspection or who is carrying any object which may be dangerous to persons or property. In addition, the Landlord reserves the right to implement such further reasonable and non-discriminatory measures designed to ensure safety of the building and the persons and property located therein as the Landlord shall deem reasonably necessary or desirable.
|
It is agreed that, except as otherwise indicated, the following work is to be done to the premises by the Landlord at the Landlord’s expense:
|
1.
|
The Landlord will provide an ACP-5 for the premises.
|
2.
|
The Landlord shall replace two 40 ton packaged rooftop air conditioners. All supply and distribution ductwork and power control and central wiring shall be the Tenant’s responsibility.
|
3.
|
The Landlord shall provide a total connected load of up to 10 watts per rentable square foot, of 3 phase 4 wire electric power with full neutrals for all of the Tenant’s electrical consumption (inclusive of the air conditioning system). The disconnect switch, submeter, and distribution of electricity within the premises shall be at the Tenant’s expense.
|
4.
|
The Landlord shall create a public freight lobby by the existing loading dock so as to provide access from the common loading dock to the basement through the rear stairwell and freight elevator. The demising wall shall be installed in the location indicated on Exhibit “A-1”.
|
5.
|
The Landlord shall repair or replace all gutters, downspouts and storm drains.
|
6.
|
The Landlord will replace with new doors the three existing egress doors from the building.
|
7.
|
The Landlord shall repair or replace the roof as necessary to put the roof in good condition.
|
It is stipulated and agreed that the foregoing constitutes the work to be done by the Landlord referred to in the lease to which this Work Letter is attached and all the work to be done by the Landlord in the premises, except as otherwise expressly provided in such lease.
|
It is further stipulated and agreed that the aforesaid work shall be commenced by the Landlord referred to in the lease to which this Work Letter is attached and all the work to be done by the Landlord in the premises, except as otherwise expressly provided in such lease.
|
Subject to the foregoing provisions the Landlord reserves the right, after according reasonable consideration to the Tenant’s wishes in the matter, to make all decisions as to the time or times when, the order and style in which, said work is to be done, and the labor or materials to be employed therefore. The work shall be done, unless the Landlord otherwise directs, during the usual working hours observed by the trades in question. It is stipulated and agreed that in case the Landlord is prevented from commencing, prosecuting or completing said work, due to the Landlord’s inability to obtain or difficulty in obtaining the labor or materials necessary therefore, or due to any governmental requirements or regulations relating to the priority or national defense requirements, or due to any other cause beyond the Landlord’s control, the Landlord shall not be liable to the Tenant for damages resulting therefrom, nor shall the Tenant be entitled to any abatement or reduction of rent by reason thereof, nor shall the same give rise to a claim in the Tenant’s favor that such failure constitutes actual, constructive, total or partial eviction from the premises.
|
THE RECTOR, CHURCH-WARDENS AND VESTRYMEN OF TRINITY CHURCH IN THE CITY OF NEW YORK, Landlord | |||
By: |
|
||
Director of Leasing | |||
COMET SYSTEMS, INC.
|
Anniversary of the
Commencement Date
|
Amount of Security Deposit
|
|||
1st Anniversary
|
$ | 400,000 | ||
2nd Anniversary
|
$ | 350,000 | ||
3rd Anniversary
|
$ | 300,000 | ||
4th Anniversary
|
$ | 250,000 | ||
5th Anniversary
|
$ | 200,000 |
THE RECTOR, CHURCH-WARDENS AND VESTRYMEN OF TRINITY CHURCH IN THE CITY OF NEW YORK | |||
By: | |||
Director of Leasing | |||
By: | |||
Executive Vice President of Real Estate | |||
By: | |||
John A. McKegny | |||
Chief Financial Officer | |||
Attest:
|
COMET SYSTEMS, INC.
|
||
As to the Tenant:
|
|||
Matt Daniel
|
By: |
|
|
John ??? | |||
An authorized officer |
Periods
|
Month
|
Year
|
Annual
Base Rent
|
Percentage
Escalation
|
Escalated
Rent
|
1
|
8
|
2000
|
$200,000.00
|
0
|
$200,000.00
|
2
|
8
|
2001
|
$200,000.00
|
6,000
|
$206,000.00
|
3
|
8
|
2002
|
$200,000.00
|
12,180
|
$212,180.00
|
4
|
8
|
2003
|
$200,000.00
|
18,545
|
$218,545.00
|
5
|
8
|
2004
|
$200,000.00
|
25,102
|
$225,102.00
|
6
|
8
|
2005
|
$200,000.00
|
31,855
|
$231,855.00
|
7 mos
|
8
|
2006
|
$200,000.00
|
38,810
|
$238,810.00
|
THE RECTOR, CHURCH-WARDENS AND VESTRYMEN OF TRINITY CHURCH IN THE CITY OF NEW-YORK | |||
By: | /Executed/ | ||
President of Real Estate | |||
By: |
/Executed/
|
||
Director of Commercial Leasing | |||
By: |
/Executed/
|
||
Chief Financial Officer | |||
MIVA DIRECT, INC. | |||
By: | /s/ John Pisaris | ||
Name: John Pisaris | |||
Title: General Counsel |
Period
|
Month/Year-Month/Year
|
Fixed Rent
|
Percentage Escalation
|
Escalated
Rent*
|
1
|
2/1/2006-1/31/2007
|
$420,750
|
0
|
$420,750
|
2
|
2/1/2007-1/31/2008
|
$420,750
|
12,623
|
433,373
|
3
|
2/1/2008-1/31/2009
|
$420,750
|
25,624
|
446,374
|
4
|
2/1/2009-1/31/2010
|
$420,750
|
39,015
|
459,765
|
5
|
2/1/2010-1/31/2011
|
$420,750
|
52,808
|
473,558
|
6
|
2/1/2011-1/31/2012
|
$420,750
|
67,015
|
487,765
|
7
|
2/1/2012-1/31/2013
|
$420,750
|
81,648
|
502,398
|
8
|
2/1/2013-1/31/2014
|
$420,750
|
96,719
|
517,469
|
9
|
2/1/2014-1/31/2015
|
$420,750
|
112,244
|
532,994
|
10
|
2/1/2015-1/31/2016
|
$420,750
|
128,233
|
548,983
|
1.
|
INTRODUCTORY PROVISIONS.
|
1.1
|
FUNDAMENTAL LEASE PROVISIONS. Certain fundamental provisions are presented in this Section in summary form to facilitate convenient reference by the parties.
|
(a)
|
Tenant's Trade Name: FindWhat.com
|
(b)
|
Anticipated Commencement Date: November 30, 2002
|
(c)
|
Term: Ten (10) years
|
(d)
|
Suite Number: 3rd, 4th and 5th Floors
|
(e)
|
Permitted Use: Corporate offices and headquarters
|
(f)
|
Size of Premises: 32,820 rentable sq. ft. (10,940 rentable sq. ft. per floor)
|
(g)
|
Annual Base Rent: $443,070.00. Annual Base Rent is based on an average rate of $13.50 per rentable sq. ft. for the initial Lease Year, as set forth in Section 4.1.
|
(h)
|
Annual Rental Increase: Three (3%) percent. See Section 4.2.
|
(i)
|
Additional Rent: Tenant's Pro Rata Share Common Area Maintenance Expenses (see Section 4.3)
|
(j)
|
Tenant Estimated Pro Rata Share: 32,823 sq.ft./51,653 sq.ft. (i.e. 63.545%), subject to the limitations set forth in Section 4.3.
|
(k)
|
Security Deposit: $100,000.00
|
(l)
|
Initial Tenant Improvements. See Section 7.1 below.
|
1.2
|
AGREEMENT. In consideration of the rent and other sums payable to Landlord hereunder and the covenants and agreements to be observed and performed by Tenant, Landlord hereby Leases to Tenant, and Tenant hereby rents from Landlord, the Premisesfor the Term, at the rental and upon the conditions and agreements hereinafter set forth.
|
2.
|
PREMISES.
|
2.1
|
PREMISES DEFINED. The term "Premises" means Tenant's suite, as identified in Section 1.1 above, which is located within Colonial Bank Plaza at Summerlin Center Professional Park, with an address of 5220 Summerlin Commons Boulevard, Ft. Myers, Florida (the "Office Building"), to be constructed by Landlord upon the real property described on Exhibit "A" hereto (the "Real Property"), in accordance with the site plan attached as Exhibit "B" hereto. The Premises shall consist of three (3) floors having the approximate dimensions and square footage as stated in Section 1.1 as shown on the floor plans of the Office Building, which are attached as Exhibit "C" to this Lease. For purposes of this Lease, the term Rentable Square Footage shall mean the usable square footage of the Premises, determined in accordance with BOMA standards, plus a common area factor based upon the ratio of usable floor area and total floor area of the floor on which the Premises are located, as certified by Landlord's architect or engineer. Prior to the Commencement Date, Landlord shall furnish Tenant with a statement from Landlord's architect or engineer certifying the as-built measurements of the Premises. In the event that the Premises are determined to contain more or less Rentable Square Footage than indicated in Section 1.1 of this Lease, then the Base Rent shall be adjusted based upon the actual Rentable Square Footage and the rental rates set forth in Section 1.1, above. The Premises shall not include any space above the interior surface of the ceiling as it exists on the Commencement Date of the Term. Tenant shall have the non-exclusive right to use space above the interior surface of the ceiling and within and behind the walls constituting or surrounding the Premises for wiring, piping, lines, sprinkler systems, communication systems, security systems, mechanical and other systems serving the Premises or used in connection with Tenant's business, as determined by Tenant. Landlord shall construct the Office Building and site improvements (including, but not limited to, all parking, driveway, sidewalks, landscaping and other improvements) and perform Landlord's Work as set forth on Exhibit "E" attached hereto in substantial compliance with the architectural drawings, floor plans, site plans and Office Building plans and specifications provided to Tenant, and in compliance with all zoning and other laws, rules, regulations, orders and ordinances of all governmental authorities.
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2.2
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PRO RATA SHARE. Tenant's Pro Rata Share, shall be determined by dividing the Rentable Square Footage of the Premises by the Total Rentable Square Footage within the Office Building, as determined by Landlord's architect or engineer, based upon BOMA standards. Tenant's Pro Rata Share is subject to adjustment by Landlord based on the foregoing formula if the Total Rentable Square Footage of the Office Building is diminished by casualty, condemnation or similar takings, or other events reducing the Total Rentable Square Footage or if the Total Rentable Square Footage is increased by additions to the Office Building.
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3.
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TERM.
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3.1
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COMMENCEMENT AND EXPIRATION DATES OF TERM. The term of this Lease (the "Term") shall commence on the earlier of: (1) fifteen (15) days after notice from Landlord that all of the Landlord's Work, including the Initial Tenant Improvements, has been substantially completed, as evidenced by a certificate of occupancy for the Premises; or (2) the date that Tenant actually opens for business in the Premises, but in either event not sooner than December 1, 2002. Tenant may take possession of the Premises prior to the Commencement Date provided that the Landlord's Work, including the Initial Tenant Improvements, have been completed. The Term shall continue for the number of Lease Year(s) set forth in Section 1.1, and shall end, unless extended or sooner terminated in accordance with the provisions herein contained, on the last day of the last Lease Year (as hereinafter defined). Tenant agrees to execute an Amendment to this Lease, after the Commencement Date and within ten (10) days after Landlord's request, to confirm Tenant's acceptance of the Premises, the Rentable Square Footage of the Premises, the Annual Base Rent, Tenant's Pro Rata Share, and the actual Commencement Date of this Lease.
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3.2
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LEASE YEAR AND ANNIVERSARY DATE. The term "Lease Year" shall mean a period of twelve (12) consecutive full calendar months. The term "Anniversary Date" shall mean the date twelve months after the Commencement Date, and each twelve (12) months thereafter through the term of this Lease. If the Commencement Date is not the first day of a calendar month, then the first Lease Year shall consist of twelve (12) consecutive full calendar months plus the partial month beginning on the Commencement Date and ending on the last day of that partial month, and the first Anniversary Date shall be the first day of the calendar month coinciding with or following the date which is twelve (12) months after the Commencement Date. Each subsequent Anniversary Date shall be the date that is twelve (12) months after the first Anniversary Date, and each succeeding Lease Year shall commence upon the Anniversary Date.
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3.3
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FAILURE OF TENANT TO ACCEPT POSSESSION. In the event Landlord notifies Tenant in writing that the Premises have been completed, and if Tenant fails to take possession within sixty (60) days thereafter, then Landlord shall have, in addition to any and all remedies herein provided, the right to immediately cancel and terminate this Lease.
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3.4
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QUIET ENJOYMENT. Upon Tenant's paying the Rent reserved hereunder and observing and performing all of the covenants, conditions, and provisions on Tenant's part to be observed and performed hereunder, Tenant shall have quiet possession of the Premises for the entire term hereof, subject to the provisions of this Lease.
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4.
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RENT. Tenant shall pay to Landlord at the office of Landlord, or at such other place designated by Landlord, without notice, demand or off-set, the following rentals (collectively, the "Rent"):
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4.1
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ANNUAL BASE RENT. The Annual Base Rent (referred to herein as the "Base Rent") for each Lease Year shall be paid in monthly installments in advance Commencing on the Commencement Date, and on or before the first day of each calendar month thereafter during the Term, plus any sales, use or other taxes assessed from time to time on the Base Rent or on the use and occupancy of the Premises. If the Commencement Date is other than the first day of a calendar month, the Rent for the period from the Commencement Date to the first day of the next succeeding month shall be prorated on a per diem basis and shall be payable with and in addition to the first monthly installment of Base Rent on the Commencement Date. Annual Base Rent is based on an average rate of $13.50 per rentable sq. ft.for the initial Lease Year, as follows: (i) $13.00 per rentable sq. ft. for the 3rd floor; (ii) $13.50 per rentable sq. ft. for the 4th floor; and (iii) $14.00 per rentable sq. ft. for the 5th floor.
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4.2
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ANNUAL RENT INCREASE. Base Rent shall increase each Lease Year, effective on the Anniversary Date of the Commencement Date, by an amount equal to the Annual Rental Increase, as set forth in Section 1.1.
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4.3
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ADDITIONAL RENT. In addition to the Base Rent, Tenant shall be responsible for payment of the following sums, as Additional Rent:
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4.3.1
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COMMON AREA MAINTENANCE. Tenant shall pay to Landlord for the operation of the Office Building and the maintenance of the Common Areas, an amount equal to Tenant's Pro Rata Share of the Common Area Maintenance Expenses, as that term is defined in Section 5.2 of this Lease. Any increases in Common Area Maintenance Expenses shall not exceed three (3%) percent per annum, with the exception of real estate taxes, insurance and utilities.
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4.3.2
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OTHER ADDITIONAL RENT. Tenant shall pay, as Additional Rent, all other sums of money or charges required to be paid by Tenant under this Lease, whether or not the same be specifically designated "additional rent" and all sales, use, or other taxes assessed, levied, or imposed from time to time on any Additional Rent. If such amounts and charges are not paid at the time provided in this Lease, they shall nevertheless, if not paid when due, be collectible as Additional Rent with the next installment of Base Rent thereafter becoming due, but nothing herein shall be deemed to suspend or delay the payment of any amount of money or charge.
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4.4
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PAYMENT OF ESTIMATED ADDITIONAL RENT. Within sixty (60) days after the end of each calendar year, Landlord shall deliver to Tenant a statement setting forth the actual Common Area Maintenance Expenses expended by Landlord during the previous calendar year. In the event that the amounts paid by Tenant during the course of the calendar year are less than Tenant's Pro Rata Share of the actual expenses, then Tenant shall, within thirty (30) days after receipt of the annual statement, pay the entire amount of the deficiency, and thereafter the monthly installment of Additional Rent shall be adjusted accordingly for the current calendar year to more closely approximate the expected actual Additional Rent. In the event that the amounts paid by Tenant during the course of the calendar year are more than Tenant's Pro Rata Share of the actual Common Area Maintenance Expenses, then Tenant shall be entitled to a credit against the amount of Base Rent and Additional Rent next due under the Lease. Landlord reserves the right to revise the estimate of Common Area Maintenance Expenses, at any time during the course of the year, and from time to time, to more closely approximate the actual Common Area Maintenance Expenses incurred by Landlord during the course of the year. Tenant shall pay to Landlord, without notice or demand, on the first day of each month during the Term of this Lease, the monthly installment of estimated Common Area Maintenance Expenses, as set forth in the most recent statement received by Tenant from time to time continuing throughout the Term of this Lease.
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4.5
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PRORATION. If the first year of the Term of this Lease commences on any day other than the first day of January, or if the last year of the Term of this Lease ends on any day other than the last day of December, any payment due to Landlord by reason of any Additional Rent or estimated installment thereof shall be prorated, and Tenant shall pay any amount due to Landlord within thirty (30) days after being billed therefor. This covenant shall survive the expiration or termination of this Lease.
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4.6
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LATE CHARGE. Any payment of Rent, including Base Rent and Additional Rent, which is not received by Landlord within ten (10) days after the date when due, shall be subject to a late charge in an amount equal to five (5%) percent of the payment then due.
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4.7
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SECURITY DEPOSIT.
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4.7.1
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Tenant has deposited the Security Deposit with Landlord, as set forth in Section 1.1. The Security Deposit shall be held by Landlord as security for the faithful performance by Tenant of all the terms of this Lease to be observed and performed by Tenant. Tenant shall be entitled to interest on any unapplied portion of the Security Deposit at the rate of three (3%) percent per annum. The Security Deposit shall not be mortgaged, assigned, transferred or encumbered by Tenant, and any such act on the part of Tenant shall be without force and effect and shall not be binding upon Landlord. The Security Deposit shall not constitute prepaid Rent or liquidated damages, but may be applied by Landlord to other amounts due under this Lease.
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4.7.2
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If any of the Rent herein reserved or any other sum payable by Tenant to Landlord shall be overdue and unpaid or should Landlord make payments on behalf of the Tenant, or Tenant shall fail to perform any of the terms of this Lease, or Tenant or any of its agents, employees, or customers, shall physically damage the Premises and such damages shall not have been corrected, then Landlord may, at its option and without prejudice to any other remedy which Landlord may have on account thereof, appropriate and apply the entire Security Deposit or so much thereof as may be necessary to compensate Landlord toward the payment of Rent or Additional Rent or loss or damage sustained by Landlord due to such breach on the part of Tenant; and Tenant shall, within five (5) days of written demand, deposit cash with Landlord to restore the Security Deposit to the original amount. Should Tenant comply with all of the terms and provisions of this Lease, including without limitation, the obligation to promptly pay all of the Rent as and when due hereunder, and provided that Tenant vacates the Premises in the condition required hereunder at the end of the Term, then Landlord shall return the Security Deposit to Tenant within fifteen (15) days after the end of the term of this Lease or any extension hereof.
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5.
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COMMON AREAS.
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5.1
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USE OF COMMON AREAS. Tenant, its guests, visitors, employees and business invitees shall have the non-exclusive right to use the common areas, including sidewalks, driveways, parking areas, service roads, and loading facilities within the Office Building, together with such other facilities as may be designated from time to time by Landlord (collectively referred to as the "Common Areas"), in common with other persons entitled to the use thereof, and provided, however, that use of the Common Areas shall be subject to the Rules and Regulations for the use thereof as may be reasonably prescribed by Landlord from time to time. Landlord reserves the right to designate visitor parking areas, to grant exclusive use of the Common Area during certain time periods when deemed by Landlord to be in the best interest of the Office Building as a whole, provided, however, such exclusive use of the Common Areas shall be on a temporary basis and shall not interfere with Tenant's business operations or use of the Premises.
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5.2
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COST OF MAINTENANCE. Tenant shall reimburse Landlord for Tenant's Pro Rata Share of all Common Area Maintenance Expenses. The term "Common Area Maintenance Expenses" shall mean the total cost and expenses incurred by or on behalf of Landlord in connection with the administration, operation, maintenance, and repair of the Office Building, including without limitation, the cost of cleaning, maintaining and repairing all portions of the Common Area; all real and personal property taxes and assessments (including without limitation waste collection, extraordinary or special assessments, and all costs and fees, including reasonable attorneys' fees, incurred by Landlord in contesting or negotiating the same with public authorities subject to Tenant's reasonable approval) levied, imposed, or assessed upon the Office Building during each Lease Year (collectively, "Taxes"), except that Taxes shall not include any sales or use taxes, income taxes or other taxes on the income received by Landlord from the operation of the Office Building; premiums for public liability insurance, casualty insurance, worker's compensation insurance and such other insurance coverage as Landlord may from time to time determine to be necessary or appropriate; painting, facade maintenance, lighting, exterior maintenance and roof repairs; repair and resurfacing of all parking areas and sidewalks; maintenance, repair and replacement of all heating, ventilation and air conditioning systems; gardening and landscaping; sign maintenance; electricity; water, sewer, removal of trash, rubbish, garbage and other refuse; security; depreciation or rental on machinery or equipment used in such maintenance; the cost of personnel to implement such services; legal fees, accounting fees and property management fees; and such other expenses which, according to generally accepted accounting principles would be considered to be common area maintenance expenses. Common Area Maintenance Expenses shall not include any leasing commissions paid by Landlord, any tenant improvements or other amounts expended by Landlord on behalf of any individual tenant or for which Landlord would be entitled to reimbursement from any individual tenant or any portion of principal or interest paid by Landlord in connection with any mortgage loan Office Building. Notwithstanding anything to the contrary set forth above, the following items are specifically excluded from Common Area Maintenance Expenses: (i) repairs or other work occasioned by fire, windstorm, or other casualty of an insurance nature or by exercise of eminent domain, to the extent covered by insurance or condemnation proceeds, (ii) depreciation and amortization except for items specifically included above; (iii) items of a capital nature, including, but not limited to, capital improvements, alterations or replacements, except to the extent that such capital improvements, alterations or replacements are required by law or reduce the operating expenses of the Office Building, in which event the total capital expenditure shall be amortized over the expected useful life of the improvement; (iv) expenses in connection with services or benefits of a type which are not provided to Tenant but which are provided to another tenant or occupant whether or not reimbursable by such other tenant; (v) costs incurred due to violation by Landlord or any other tenant of the terms and conditions of any other lease or agreement; (vi) any costs, fines, or penalties incurred due to violation by Landlord of any governmental rule, law or regulation or the noncompliance of the Office Building with any rule, code, law or regulation; (vii) costs of sculpture, paintings or works of art; (viii) costs of correcting structural or other defects in any part of the Office Building; (ix) costs relating to the testing, monitoring, control or renewal of any hazardous substances; (x) attorneys fees and other costs in connection with negotiating and drafting other leases within the Office Building, or in connection with any disputes arising in connection with any lease or other tenant or occupant of the Office Building; (xi) Landlord's general overhead and administrative expenses not relating directly to management and operation of the Office Building; (xii) advertising and promotional expenses incurred with respect to leasing any part of the Office Building; (xiii) bad debt and uncollected rent; and (xiv) premiums for business interruption or rent interruption insurance. Any administrative and/or management fees shall not exceed the fee that would be charged by an independent third party management company for comparable services for office buildings of comparable size and quality in Lee County, Florida.
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5.3
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ALTERATIONS. Landlord reserves the right to make alterations, additions, changes, reconfigurations or improvements to the Common Areas including, without limitation, the main lobby, parkingareas, driveways, sidewalks and entrances to the Office Building; provided that Landlord makes reasonable accommodations to provide Tenant with unimpeded access to the Premises. No alteration, addition, change, reconfiguration or improvement shall in any event be deemed to be a Common Area Maintenance Expense. Tenant's consent shall not be required with respect to any such alterations, additions, changes, reconfigurations or improvements.
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6.
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USE OF PREMISES.
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6.1
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USE. Tenant shall use and occupy the Premises only for the use set forth in Section 1.1 hereof and any and all ancillary and related uses thereto, and shall not use or occupy the Premises or permit the same to be used for any other purpose without the prior written consent of Landlord, such consent not to be unreasonably withheld. Tenant agrees that it will use the Premises in such a manner so as not to interfere with or infringe on the rights of other tenants in the Office Building. Tenant shall not use or occupy the Premises in violation of any law, ordinance, regulation, or directives of any governmental authority having jurisdiction thereof or of any condition of the certificate of occupancy issued for the Office Building, and shall, upon five (5) days' written notice from Landlord, discontinue any use of the Premises which is declared by any governmental authority having jurisdiction to be in violation of any law, ordinance, regulation, or directive of said certificate of occupancy. During the Term, Tenant shall be in continuous use and occupancy of the Premises and shall not vacate or abandon the same.
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6.2
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SIGNAGE.
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6.2.1
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Landlord shall install a "FindWhat.com" sign on the exterior facade of the Office Building and on any pylon or monument sign for the Office Building, at Tenant's expense, as shown on the Signage Plan attached as Exhibit "F" hereto. Tenant's signage shall be the maximum size allowable by the City of Ft. Myers. subject to Landlord's approval, which will not be unreasonably withheld, delayed or conditioned. Landlord agrees that no other signs, except for Tenant's and one other tenant of the Office Building shall be placed on the exterior facade of the Office Building during the term of the Lease. If Tenant vacates the 3rd and 4th floor pursuant to the Relocation Option, as described in the Addendum to Lease, which is attached hereto, then Landlord shall have the right to remove Tenant's signage.
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6.2.2
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Tenant shall be permitted to maintain signage on the Office Building directories and on the entrance to its Premises, provided all such signs shall be uniform in appearance, as approved by Landlord. Landlord shall also list Tenant on any building directory sign installed by Landlord in the lobby of the Office Building and on the floor of the Office Building on which Tenant's Premises are located.
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6.3
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NAME OF BUILDING. Landlord reserves the right to change the name of the Office Building, from time to time, at Landlord's discretion.
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6.4
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USE RESTRICTION. Tenant acknowledges that no portion of the Premises may be used for retail banking purposes. The term "retail banking purposes" shall mean receiving deposits and making loans to the general public, whether done by a state bank, national bank, savings and loan association, credit union, mutual fund or other entity, whether the same be state or federally chartered, whether by walk-up or drive-in teller facility, automated teller machine or otherwise.
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7.
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TENANT IMPROVEMENTS; ALTERATIONS, REPAIRS, AND MAINTENANCE.
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7.1
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INITIAL TENANT IMPROVEMENTS. Landlord shall, at Landlord's expense, construct the initial tenant improvements (the "Initial Tenant Improvements") for the Premises, on behalf of Tenant, in accordance with the plans and specifications prepared by Design 2000, Inc., which have been separately initialed by the parties (the "Plans"). No further changes shall be made to the planned construction, except with the written consent of Landlord and Tenant, and any such change shall be performed at Tenant's expense. Landlord shall be responsible for obtaining all permits that may be required to construct the Initial Tenant Improvements. Landlord shall endeavor to keep Tenant reasonably apprised of the status of the construction and the Anticipated Completion Date. Upon completion of the Initial Tenant Improvements, and prior to delivery of possession of the Premises to Tenant, Landlord shall give notice to Tenant to examine the Premises, with Landlord's representative, at the time specified in such notice. Upon completion of the inspection, Tenant shall sign and give to Landlord a statement setting forth any items that the parties agree are incomplete or otherwise deviate from the Final Plans. Landlord shall complete or correct any items that Landlord agrees are incomplete or insufficient within a reasonable period of time after the date that Tenant takes possession of the Premises.
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7.2
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SUBSEQUENT ALTERATIONS. Upon completion of the Initial Tenant Improvements, Tenant shall have the right, from time to time, to paint and redecorate the interior of the Premises without Landlord's consent. Any additions, alterations, partitions, changes, or improvements in or to the Premises, or any part thereof, shall require the prior written consent of Landlord, such consent not to be unreasonably withheld, and shall be performed only by licensed contractors approved, in advance, by Landlord, such approval not to be unreasonably withheld. Tenant shall not have the right to make any additions, alterations, partitions, changes, or improvements that affect the structure, structural strength, or outward appearance of the Premises or the building. Tenant shall submit to Landlord plans and specifications for such work at the time approval is sought. Any additions, alterations, changes, or improvements made in or to the Premises by Tenant shall be in compliance with all insurance requirements and regulations and ordinances of governmental authorities and shall, upon the expiration or sooner termination of the Term, become the property of Landlord unless removed by Tenant in Tenant's discretion. In the event Tenant elects to remove any such addition or improvement, Tenant shall promptly repair any damage to the Premises resulting from such removal.
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7.3
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REPAIRS BY LANDLORD. Landlord agrees to keep and maintain in good order and repair in a first class condition the roof, structural components, and exterior walls of the Premises, all heating, ventilation, and air conditioning systems (HVAC), landscaping, parking areas, and Common Areas. Landlord gives to Tenant exclusive control of the Premises and shall be under no obligation to inspect the Premises. Tenant shall at once report in writing to Landlord any defective condition known to Tenant that Landlord is required to repair pursuant to this Section 7.3. Landlord's obligation to repair is expressly limited to those items set forth in this Section 7.3.
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7.4
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REPAIRS BY TENANT. Tenant shall, at its own cost and expense, keep and maintain the Premises and appurtenances thereto and every part thereof, in good order and repair, with the exception of those portions of the Premises to be repaired by Landlord pursuant to Section 7.3 hereof. Without limiting the foregoing, Tenant agrees to keep in good order and repair and to replace as needed all fixtures pertaining to water, sewer, electrical and sprinkler systems (if any) and Tenant shall be liable for any damage to such systems. All damage or injury to the Premises, the building, or the Common Areas caused by the act or negligence of Tenant, employees, agents, contractors, invitees or licensees, shall be promptly repaired by Tenant at its sole cost and expense and to the satisfaction of Landlord to the extent the same is not covered by proceeds of insurance carried by Landlord. Landlord may make such repairs that are not promptly made by Tenant and charge Tenant for the cost thereof, and Tenant hereby agrees to pay such amounts on demand as additional rent hereunder.
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7.5
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RUBBISH REMOVAL. Tenant shall keep the Premises clean and will remove all garbage and rubbish from the Premises. Tenant shall not burn any materials of any kind upon the Premises or Common Areas. Tenant agrees to keep all accumulated garbage and rubbish in covered containers and to have same removed regularly and in no event less frequently than as required by the Rules and Regulations. Should Tenant fail to abide by its obligations on this Section, then Landlord may, in addition to any other rights and remedies, cause the same to be done for and on account of Tenant, and Tenant hereby agrees to pay the expense thereof on demand as Additional Rent.
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7.6
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COMMON HALLWAYS. Tenant shall neither encumber nor obstruct the common hallways of the Office Building nor allow the same to be obstructed or encumbered in any manner.
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8.
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TENANT'S PROPERTY.
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8.1
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TAXES ON LEASEHOLD. Tenant shall pay prior to delinquency all taxes, both real and personal, assessed against or levied upon the leasehold and upon its fixture, furnishings, equipment, leasehold improvements, and all other personal property of any kind owned by or used in connection with the Premises by Tenant.
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8.2
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INDEMNITY.
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8.2.1
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Tenant shall indemnify and hold harmless Landlord from any liability, loss, claim or damage and expense, including attorney's fees and costs in settlement, at trial and on appeal, in connection with loss of life, personal injury or property damage arising from any occurrence in, upon, at or from the Premises or the common areas, occasioned wholly or in part by any act or omission of Tenant, its employees, agents, contractors, invitees or licensees to the extent such liability, loss, claim, damage or expense is not covered by proceeds of insurance.
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8.2.2
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Tenant shall store its property in and shall occupy the Premises and all other portions of the Office Building at its own risk, and hereby releases Landlord, to the full extent permitted by law, from all claims of every kind resulting from loss of life, personal injury or property damage occurring on the Premises, excluding only the gross negligence or willful misconduct of Landlord, its employees, agents or contractors. |
8.2.3
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Landlord shall not be responsible or liable to Tenant for any loss or damage to either the person or property of Tenant that may be occasioned by or through the acts or omissions of tenants occupying any other portions of the Office Building or the acts or omissions of any other person or entity, excluding only Landlord's employees, agents and contractors.
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8.2.4
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Landlord shall not be responsible or liable for any injury, loss or damage to any person or to any property caused by or resulting from bursting, breakage, leakage, steam, running, backing up, seepage, or the overflow of water or sewage in any part of said premises or for any injury or damage caused by or resulting from acts of God or the elements, or for any injury or damage caused by or resulting from any defect or negligence in the occupancy, construction, operation or use of any of said Premises, building, machinery, apparatus or equipment by any occupant of the Premises other than Landlord, its employees, agents and contractors.
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8.2.5
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Tenant shall give prompt written notice to Landlord in case of any fire or other casualty or accident in or about the Premises or the Office Building, or of any defective or dangerous conditions of which Tenant may become aware.
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9.
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INSURANCE AND INDEMNITY.
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9.1
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TENANT'S INSURANCE. Tenant shall at all times during the Term of this Lease maintain the following insurance coverage:
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9.1.1
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LIABILITY INSURANCE. Tenant shall carry at its own expense comprehensive general public liability and property damage insurance with combined single limits of not less than $1,000,000;
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9.1.2
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CASUALTY INSURANCE. A standard form policy of casualty insurance with standard form of extended coverage endorsement covering all furniture, fixtures, equipment and other personal property located in the Premises and used by Tenant in connection with its business.
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9.1.3
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WORKER'S COMPENSATION AND EMPLOYER LIABILITY COVERAGE. Worker's compensation and employer liability coverage, as required by law.
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9.2
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EVIDENCE OF INSURANCE. All insurance coverage required to be maintained by Tenant hereunder shall be maintained with insurance companies authorized to do business in the State of Florida and reasonably acceptable to Landlord. All policies shall name Landlord as an additional insured and shall require that Landlord be provided with at least thirty (30) days prior written notice of any modification or cancellation. Tenant shall deliver duplicate original policies or certificates thereof to Landlord upon execution of this Lease, and thereafter Tenant shall deliver renewal policies or certificates to Landlord not less than fifteen (15) days prior to the expiration of the policies of insurance. The failure of Tenant either to effect said insurance in the names herein called for or to pay the premiums therefor or to deliver said policies or certificates to Landlord shall, at Landlord's option, permit Landlord to procure the insurance and pay the requisite premiums therefor on behalf of Tenant, which premiums shall be paid to Landlord with the next installment of Rent. Landlord's procurement or maintenance of such insurance on behalf of Tenant shall not be a waiver of such default.
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9.3
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LANDLORD'S INSURANCE. Landlord shall maintain a policy or policies of casualty insurance covering the full replacement value of the Office Building with standard form of extended coverage endorsement and standard form of lender's loss payable endorsement issued to the holders of a mortgage or deed of trust secured by the Premises, together with vandalism, malicious mischief, and sprinkler leakage coverage. Tenant shall reimburse Landlord for Tenant's Pro Rata Share of such insurance as provided in Article 4 hereof.
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9.4
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WAIVERS OF SUBROGATION. Each of the parties hereto waives any and all rights of recovery against the other or against any other tenant or occupant of the building or the Office Building or against the officers, employees, agents, representatives, invitees, customers, and business visitors of such other party or of such other tenant or occupant of the building or the Office Building for loss of or damage to such waiving party or its property or the property of others under its control arising from any cause insured against under the standard form of fire insurance policy with all permissible extensions and endorsements covering additional perils, or under another policy of insurance carried by such waiving party in lieu thereof, to the extent of the insurance proceeds paid thereunder. If obtainable without additional expense, each party shall obtain a waiver of subrogation from its insurance carrier.
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10.
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DESTRUCTION.
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10.1
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PARTIAL DESTRUCTION. Subject to the provisions of Sections 10.2 and 10.3, if the Premises, Office Building or Common Areas shall be partially damaged by any casualty, Landlord shall commence to repair the damage within sixty (60) days and shall thereafter diligently pursue repair of the damage to completion, in order to restore the Premises, Office Building or Common Area to their condition at the time of the occurrence of the damage. The Base Rent and Additional Rent shall be abated proportionately as to that portion of the Premises rendered untenantable.
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10.2
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SUBSTANTIAL OR TOTAL DESTRUCTION. If the Premises, Common Areas or Office Building shall be totally destroyed or damaged by casualty, or if the Premises, Office Building or Common Areas shall be so damaged or destroyed to such an extent that Tenant is unable to conduct its business at the Premises in the ordinary course, as determined by Tenant, and if the estimated time to repair or replace such damage or destruction exceeds two hundred forty (240) days from the date of such damage or destruction, then either party may terminate this Lease by written notice to the other within sixty (60) days after the date of such damage or destruction, such termination to be effective as of the date of the damage or destruction. If neither party terminates this Lease as set forth above, Landlord shall promptly repair or replace such damage or destruction, and the Base Rent and Additional Rent shall abate until the Premises have been restored to their condition at the tine of the occurrence of the damage.
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10.3
|
SCOPE OF WORK. Notwithstanding the provisions of Section 10.1 and 10.2, above, Landlord's scope of work to the Premises shall not exceed the scope of work to be performed by Landlord in originally constructing the Premises on behalf of Tenant. Unless this Lease is terminated by Landlord or Tenant, Tenant shall repair and refixture at Tenant's expense the interior of the Premises in a manner and to at least a condition equal to that existing prior to its destruction or casualty and the proceeds of all insurance carried by Tenant on its property and improvements shall be held in trust by Tenant for the purpose of said repair and replacement.
|
11.
|
CONDEMNATION.
|
11.1
|
TOTAL CONDEMNATION. If the whole of the Premises shall be acquired or taken pursuant to the power of eminent domain by any governmental entity, then this Lease and the term herein shall cease and terminate as of the date of title vesting in the public authority in such proceeding.
|
11.2
|
PARTIAL CONDEMNATION. If any part of the Premises or Common Areas, but less than all, shall be acquired or taken pursuant to the power of eminent domain by any governmental entity, and such partial taking shall render that portion not so taken unsuitable for the business of Tenant as determined by Tenant, then this Lease and the Term herein shall cease and terminate as aforesaid. If such partial taking does not render the Premises unsuitable for the business of Tenant, then this Lease shall continue in effect except that the Base Rent and Additional Rent shall equitably abate and Landlord shall, upon receipt of the award in condemnation, make all necessary repair or alterations to the building in which the Premises are located or Common Areas so as to constitute the portion of the building or Common Areas not taken a complete architectural unit, but such work shall not exceed the scope of the work to be performed by Landlord in originally constructing the portion of the building housing the Premises and Common Areas, nor shall Landlord in any event be required to spend for such work an amount in excess of the amount received by Landlord as damages for the part of the Premises so taken. The provisions herein governing application of condemnation proceeds shall control over any mortgage now or hereafter encumbering the Premises.
|
11.3
|
COMPENSATION. All compensation awarded or paid upon such a total or partial taking of the Premises shall belong to and be the property of Landlord without any participation by Tenant. Tenant shall, however, be entitled to claim, prove and receive in such condemnation proceedings such award as may be allowed for taking any of Tenant's property, including, but not limited to, leasehold improvements and fixtures, relocation costs and loss of Tenant's business. To the extent that the Tenant has a claim in condemnation proceedings, as aforesaid, Tenant may claim from condemning authority, but not from Landlord, such compensation as may be recoverable by Tenant.
|
12.
|
ASSIGNMENT AND SUBLETTING. Tenant shall not assign, mortgage or encumber this Lease, in whole or in part, without the prior written consent of Landlord, which consent shall not be unreasonably or in bad faith withheld, delayed or conditioned. Tenant shall have the right to sublease all or a portion of the Premises, with the prior written consent of Landlord, which consent shall not be unreasonably or in bad faith withheld, delayed or conditioned, provided that the proposed sublessee meets the then current reasonable credit criteria of Landlord (which credit criteria shall not be more stringent than that which is customarily utilized by similarly situated lessors of similar commercial properties in Lee County, Florida), including, without limitation, a minimum net worth of not less than the minimum net worth of Tenant as of the Commencement Date of this Lease, with comparable business experience and reputation. The consent by Landlord to any assignment or subletting shall not constitute a waiver of the necessity for such consent to any subsequent assignment or subletting. If this Lease is assigned or if the Premises or any part thereof are occupied by any party other than Tenant in violation of this Section, Landlord may collect Rent from the assignee, or occupant and apply the net amount collected to the Rent herein reserved, but no such assignment, underletting, occupancy or collection shall be deemed a waiver of this provision or an acceptance of the assignee, undertenant or occupant as lessee, or as a release of Tenant from the further performance by Tenant of the provisions on its part to be observed or performed herein. Notwithstanding any assignment or sublease, or Landlord's consent thereto, Tenant shall remain fully liable and shall not be released from performing any of the terms of this Lease. Tenant shall not permit any business to be operated in or from the Premises by any concessionaire or licensee without the prior written consent of Landlord, such consent not to be unreasonably withheld.
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13.
|
SUBORDINATION AND NON-DISTURBANCE. This Lease and Tenant's rights hereunder are and shall be subject and subordinate to any mortgage, deed to secure debt or other security instrument now or hereafter placed against the Real Property, the Office Building or the Premises, or any part thereof; and to all renewals, modifications, replacements, consolidations and extensions thereof; provided, however, that Landlord shall, prior to the Commencement Date, procure and deliver to Tenant a Non-Disturbance Agreement from any then existing mortgagee, pursuant to the terms which such mortgagee shall agree not to disturb Tenant's rights to possession under the terms of this Lease so long as Tenant remains current and is not in default hereunder. In furtherance of this section, Landlord and Tenant agree that this Lease shall act as a subordination agreement and shall automatically subordinate this Lease to any such mortgage, deed to secure or other security interest. Upon request of Landlord, Tenant shall execute and deliver any further instruments, acts, things or documents to evidence such subordination within ten (10) days after Landlord's request therefore; provided that the then existing mortgagee agrees to provide the Non-Disturbance Agreement contemplated herein.
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14.
|
ESTOPPEL STATEMENT. Within ten (10) days after Landlord's written request, Tenant shall promptly execute and deliver to Landlord a written statement confirming, to the extent that same is accurate, the following: (1) that this Lease is in full force and effect and has not been assigned, modified, supplemented or amended (except by such writings as shall be stated in Tenant's statement); (2) the commencement and termination dates of this Lease; (3) that all conditions under this Lease to be performed by Landlord have been satisfied (or any exceptions thereto); (4) that there are no defenses or offsets against the enforcement of this Lease by the Landlord, or stating those claimed by Tenant; (5) the amount of the then current monthly Base Rent and Additional Rent paid by Tenant; (6) the date to which Rent has been paid; (7) the amount of Security Deposit held by Landlord; and (8) such other information as may be reasonably requested by Landlord. Such statement shall be executed and delivered by Tenant from time to time as may be requested by Landlord. It is expressly understood that any such statement may be relied upon by Landlord and any prospective purchaser or lender. Tenant's failure to deliver such statement within the allotted time shall be conclusive upon Tenant that this Lease is in full force and effect without modification, except as may be represented by Landlord, and that there are no uncured defaults in Landlord's performance or other outstanding obligations of Landlord hereunder.
|
15.
|
ATTORNMENT. Tenant shall in the event of the sale or assignment of Landlord's interest in the Office Building, or in the event of any foreclosure of, or in the event of exercise of the power of sale under any mortgage made by Landlord covering the Premises, attorn to the purchaser and recognize such purchaser as Landlord under this Lease.
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16.
|
DEFAULT.
|
16.1
|
EVENTS OF DEFAULT BY TENANT. Each of the following occurrences shall constitute an Event of Default by Tenant under this Lease:
|
16.1.1
|
Tenant's failure to pay the Rent, including Base Rent and any Additional Rent, which default shall continue for more than ten (10) days after written notice; provided, however, that Landlord shall not be required to provide Tenant with notice of default more than two (2) times within any twelve (12) month period. Thereafter, Tenant shall be in default under this Lease if it fails to pay the Rent, including Base Rent and any Additional Rent, within ten (10) days after the date when due hereunder, without notice.
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16.1.2
|
Tenant vacates or abandons the Premises or ceases doing business therein for a period of thirty (30) consecutive days;
|
16.1.3
|
The appointment of a receiver for all or substantially all of Tenant's property,
|
16.1.4
|
The voluntary filing by Tenant or any guarantor of any petition in bankruptcy or other similar petition under State law, the filing of any answer by Tenant or any guarantor admitting to insolvency or to an inability to pay its debts as they become due, or the filing of any involuntary petition against Tenant or any guarantor that is not dismissed within one hundred twenty (120) days;
|
16.1.5
|
The dissolution or liquidation of Tenant;
|
16.1.6
|
Any assignment or sublease of Tenant's interest hereunder in violation of this Lease without the prior written consent of Landlord;
|
16.1.7
|
The breach by Tenant of any representations and warranties set forth in this Lease;
|
16.1.8
|
Tenant's failure to keep and perform any other obligations set forth in this Lease within thirty (30) days after written notice from Landlord of its failure to do so;
|
16.2
|
LANDLORD REMEDIES. Upon the occurrence of an Event of Default, and with appropriate judicial process, Landlord may, at its option, exercise any one or more of the following rights and remedies:
|
16.2.1
|
Terminate this Lease, and all rights of Tenant hereunder, by giving not less than three (3) days written notice of termination, whereupon Landlord may re-enter upon and take possession of the Premises;
|
16.2.2
|
Take possession of the Premises without terminating this Lease and rent the same for the account of Tenant (which may be for a term extending beyond the Term of this Lease) in which event Tenant covenants and agrees to pay any deficiency after crediting it with the rent thereby obtained less all repairs and expenses, including the costs of remodeling and brokerage fees, and Tenant waives any claim it may have to any rent obtained on such releting which may be in excess of the Rent required to be paid herein by Tenant;
|
16.2.3
|
Accelerate the Tenant's obligation to pay Rent for the remaining term of the Lease;
|
16.2.4
|
Perform such obligation (other than payment of Rent) on Tenant's behalf and charge the cost thereof, to Tenant as Additional Rent; or
|
16.2.5
|
Exercise any and all other rights granted to Landlord under this Lease or by applicable law or in equity.
|
16.3
|
RIGHTS AND REMEDIES CUMULATIVE. The rights and remedies granted to Landlord may be exercised concurrently and shall be cumulative and in addition to any other rights and remedies as may be available to Landlord by law or in equity, and the exercise of one or more rights or remedies shall not impair Landlord's right to exercise any other right or remedy. The failure or forbearance of Landlord to enforce any right or remedy in connection with any default shall not be deemed a waiver of such default nor a consent to a continuation thereof, nor waiver of the same default at any subsequent date.
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16.4
|
ATTORNEY'S FEES. In the event of any litigation arising under this Lease, the prevailing party shall be entitled to recover reasonable attorney's fees and costs (including without limitation, all such fees, costs and expenses incident to pre-trial, trial, appellate, bankruptcy, post-judgment and alternative dispute resolution proceedings), incurred in that suit, action or proceeding, in addition to any other relief to which such party is entitled. Attorneys' fees shall include, without limitation, paralegal fees, investigative fees, expert witness fees, administrative costs and all other charges billed by the attorney to the prevailing party.
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17.
|
ACCESS TO PREMISES. Landlord shall have the right to enter the Premises at all reasonable times, during normal business hours, to inspect or to exhibit the same to prospective purchasers, mortgagees, lessees, and tenants and to make such repairs, additions, alterations or improvements, as Landlord may deem desirable. Landlord shall provide Tenant with reasonable advance notice of any planned entry upon the Premises, and shall not interfere with the conduct of Tenant's business from the Premises. Landlord shall be allowed to take all material in, to and upon the Premises that may be required therefore without the same constituting an eviction of Tenant in whole or in part and the Rents reserved shall in no way abate while said work is in progress so long as the same does not interrupt Tenant's business. If Tenant shall not be personally present to permit an entry into the Premises when for any reason an entry therein shall be permissible, Landlord may enter the same (or in the event of emergency or to prevent waste, by the use of force) without rendering Landlord liable therefore and without in any manner affecting the obligations of this Lease. The provisions of this paragraph shall in no wise be construed to impose upon Landlord any obligation whatsoever for the maintenance or repair of the building or any part thereof except as otherwise herein specifically provided.
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18.
|
SALE BY LANDLORD. In the event of any sale or other transfer of Landlord's interest in the Premises or the Office Building, other than a transfer for security purposes only, Landlord shall be automatically relieved of any and all obligations and liabilities on the part of Landlord occurring from and after the date of such transfer; provided, that the transferee shall assume all of the obligations of Landlord under this Lease and that Tenant's Security Deposit and any prepaid Rent shall be turned over to the transferee. It is intended hereby that the covenants and obligations contained in this Lease on the part of the Landlord shall be binding on Landlord only during its period of ownership of the Office Building. Tenant agrees to took solely to Landlord's estate and property in the Office Building (or the proceeds thereof) for the satisfaction of Tenant's remedies for the collection of a judgment or other judicial process requiring the payment of money by Landlord in the event of any default by Landlord hereunder, and no other property or assets of Landlord shall be subject to levy, execution, or other enforcement procedure for the satisfaction of Tenant's remedies under or with respect to this Lease, the relationship of Landlord and Tenant hereunder, or Tenant's use or occupancy of the Premises.
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19.
|
END OF TERM. At the expiration of this Lease, Tenant shall surrender the Premises in the same condition as it was in upon the delivery of possession thereto under this Lease, reasonable wear and tear excepted, and shall deliver all keys to Landlord. Before surrendering the Premises, Tenant shall remove all its personal property. Tenant may, but shall not be obligated to, remove all trade fixtures, alterations, additions and decorations, and shall repair any damage caused thereby. Tenant's obligations to perform this provision shall survive the end of the Term of this Lease. If Tenant fails to remove its property which it is required to remove upon the expiration of this Lease, the said property, at Landlord's option, shall be deemed abandoned and shall become the property of Landlord.
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20.
|
HOLDING OVER. Any holding over after the expiration of this Term or any renewal term shall, by lapse of time or otherwise, be construed to be a tenancy at sufferance and Tenant shall pay to Landlord an amount equal to two (2) times the Rent, including Base Rent and Additional Rent, for all of the time Tenant shall retain possession of the Premises or any part thereof. The provisions of this paragraph shall not operate as a waiver by the Landlord of any right of reentry herein provided, nor shall any act or receipt of money by Landlord in apparent affirmance of the holding over operate as a waiver of the right to terminate this Lease for any breach of covenant by the Tenant; nor shall any waiver by the Landlord of its right to terminate this Lease for any later breach of the same or another covenant.
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21.
|
INABILITY TO PERFORM. The time for performance by either of the parties shall be extended by the number of days that their performance is delayed as a result of fire, hurricane, flood, inclement weather or other acts of God, governmental action or inaction, strikes, riot, civil disturbance, insurrection, unavailability of materials, acts or omissions of unaffiliated independent contractors or other causes beyond their reasonable control; provided that, the party claiming such delay notifies the other party in writing within five (5) days of the commencement of the condition preventing its performance and its intent to rely thereon to extend the time for its performance of this Agreement.
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22.
|
RULES AND REGULATIONS. Tenant shall observe faithfully and comply strictly with the Rules and Regulations adopted by Landlord from time to time for the safety, care, and cleanliness of the Office Building or the preservation of good order therein. Wherever the Rules and Regulations shall require the consent or approval of Landlord, Landlord shall not unreasonably withhold its consent or approval to any reasonable request of Tenant. Landlord shall not be liable to Tenant for any violation of the Rules and Regulations or for the breach of any covenant or condition in any Lease by any other tenant in the Office Building, but Landlord shall use commercially reasonable efforts to enforce the Rules and Regulations, including issuance of warning notices, but Landlord shall not be required to evict or file other legal actions against any other tenant. The Rules and Regulations currently prescribed by Landlord are attached hereto as Exhibit "D". Landlord reserves the right to reasonably amend the Rules and Regulations from time to time, which amendments shall become effective upon delivery of a copy of same to Tenant. Landlord grants to Tenant a variance from the Rules and Regulations to allow Tenant to operate food and beverage vending machines for Tenant's employees.
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23.
|
HAZARDOUS SUBSTANCES OR CONDITIONS. If Tenant's business requires the use of any hazardous or toxic substances, as defined by any state or federal law, Tenant shall so advise Landlord and shall obtain Landord's consent prior to bringing such substances onto the Premises. Tenant shall use, handle and dispose of any such substances in accordance with all applicable laws and permits, and shall, in no event, dispose of any such substances on or about the Premises. In no event shall Tenant keep or permit flammable, combustible or explosive substance nor any substance that would create or tend to create a dangerous or combustible condition on or about the Premises. Furthermore, Tenant shall not install electrical or other equipment that Landlord determines might cause impairment or interference with the provisions of services to the Office Building.
|
24.
|
CONTRACTOR'S LIENS. Tenant shall have no authority to subject the Real Property, the Office Building or the Premises or any interest of Landlord therein to any contractor's or other liens. Should any contractor's or other liens be filed against the Real Property, the Office Building or the Premises or any interest of Landlord therein, by reason of Tenant's act or omissions or because of a claim against Tenant, Tenant shall cause the same to be canceled and discharged of record by bond or otherwise within ten (10) days after notice by Landlord. Tenant hereby indemnifies Landlord against, and shall keep the Premises and Office Building free from, any and all contractor's liens and other liens arising from any work performed, material furnished, or obligations incurred by Tenant in connection with the Premises or the Office Building, and agrees to obtain discharge of any lien which attached as a result of such work immediately after such liens attaches or payment for the labor or materials due.
|
25.
|
SECURITY INTEREST. Landlord hereby waives any and all rights to a landlord's lien or other lien, whether statutory or otherwise, on any and all of Tenant's property located at the Premises during the Term of this Lease.
|
26.
|
WAIVER. Failure of Landlord to insist upon the strict performance of any provisions or to exercise any option contained herein or enforce any rules and regulations shall not be construed as a waiver for the future of any such provision, rule or option. The receipt by Landlord of Rent with knowledge of the breach of any provision of this Lease shall not be deemed a waiver of such breach. No provision of this Lease shall be deemed to have been waived unless such waiver be in writing signed by Landlord. No payment by Tenant or receipt by Landlord of a lesser amount than the monthly Rent shall be deemed to be other than on account of the earliest Rent then unpaid nor shall any endorsement or statement on any check or any letter accompanying any check or payment as Rent be deemed an accord and satisfaction and Landlord may accept such check or payment without prejudice to Landlord's right to recover the balance of such rent or pursue any other remedy provided in this Lease or by law and no waiver by Landlord in respect to one tenant shall constitute a waiver in favor of any other tenant in the Office Building.
|
27.
|
NO ESTATE BY TENANT. This Lease shall create the relationship of lessor and lessee between Landlord and Tenant; no estate shall pass out of Landlord. Tenant's interest shall not be subject to levy or sale, and shall not be assignable by Tenant except as provided in Section 12 hereof. Nothing contained in this Lease shall, or shall be deemed or construed so as to, create the relationship or principal-agent, joint venturers, co-adventurers, partners or co-tenants between Landlord and Tenant; it being the express intention of the parties that they are and shall remain independent contractors one as to the other.
|
28.
|
OTHER TENANTS. Landlord does not warrant the continuous operation by any co-tenant in the Office Building. The cessation of operations by any co-tenant, pursuant to such Tenant's respective rights to vacate, shall not effect a right of termination in Tenant.
|
29.
|
REPRESENTATIONS AND WARRANTIES OF TENANT. Tenant, and the individual executing this Lease on behalf of Tenant, hereby represents and warrants and to Landlord that: (a) Tenant is a corporation, duly organized and validly existing under the laws of the State of Nevada, and qualified with the Secretary of State of the State of Florida to transact business in the State of Florida; (b) Tenant has all necessary power and authority to enter into this Lease and has all necessary licenses to conduct its business for the uses contemplated hereunder; (c) Tenant has obtained any necessary approvals of Tenant's Board of Directors and shareholders to the execution and performance by Tenant of its obligations under this Lease; and (d) this Lease constitutes a binding and enforceable obligation of Tenant and does not conflict with any provision of Tenant's organizational documents or of any other lease or other agreement to which Tenant is a party or by which Tenant may be bound.
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30.
|
BROKERS. Landlord and Tenant each represent and warrant to the other that it has not dealt with, consulted or contacted any real estate broker, agent, or finder in connection with or in bringing about the leasing of the property, other than Florida Fidelity Realty Advisors, Inc. and Grubb & Ellis/VIP-D'Alessandro. Landlord agrees to pay the brokers named herein per separate agreement. Each party hereby agrees to defend, indemnify and hold the other harmless of and from any and all expense, cost, damage, loss and liability arising out of a breach of the foregoing representations, warranties and covenants by the defaulting party.
|
31.
|
NOTICES. Any notice, demand, request or other instruments which may be or required to be given under this Lease shall be delivered in person or sent by United States Certified or Registered Mail, postage prepaid, and shall be addressed, as follows:
|
If to Landlord:
|
Alanda, Ltd.
|
||
12800 University Drive, Suite 240
|
|||
Ft. Myers, Florida 33907
|
|||
Attention: O.J. Buigas
|
|||
With a copy to:
|
Bolanos Truxton, P.A.
|
||
12800 University Drive, Suite 340
|
|||
Ft. Myers, Florida 33907
|
|||
Attention: Gregg S. Truxton
|
|||
If to Tenant:
|
FindWhat.com
|
||
12751 Westlinks Drive, Suite 3,
|
|||
Ft. Myers, Florida 33919
|
|||
Attention: Craig A. Pisaris-Henderson, President
|
|||
With a copy to:
|
Porter Wright Morris & Arthur
|
||
5801 Pelican Bay Blvd., Suite 300
|
|||
Naples, Florida 34108-2709
|
|||
Attention: Kevin Lottes
|
|
Either party may designate such other address as shall be given by written notice.
|
32.
|
MISCELLANEOUS.
|
32.1
|
ENTIRE AGREEMENT. This Lease, together with any exhibits or addenda hereto, constitutes the entire agreement by and between parties hereto with respect to the subject matter hereof and supersedes all prior agreements, understandings, negotiations and discussions, both written and oral, by and between the parties hereto with respect to such subject matter. No representations, warranties or agreements have been made or, if made, have been relied upon by either party, except as specifically set forth herein. This Lease may not be amended or modified in any way except by a written instrument executed by each party hereto.
|
32.2
|
BINDING EFFECT. All terms and provisions of this Agreement shall be binding upon, inure for the benefit of and be enforceable by and against the parties hereto and their respective personal or other legal representatives, heirs, successors and permitted assigns.
|
32.3
|
HEADINGS. The article headings in this Lease are for convenient reference only and shall not have the effect of modifying or amending the expressed terms and provisions of this Lease, nor shall they be used in connection with the interpretation hereof.
|
32.4
|
PRONOUNS; GENDER. All pronouns and any variations thereof shall be deemed to refer to the masculine, feminine, neuter, singular or plural as the identity of the personal liability or obligation with respect to same.
|
32.5
|
TIME. Time shall be of the essence. Any reference herein to time periods of less than six (6) days shall in the computation thereof exclude Saturdays, Sundays and legal holidays, and any time period provided for herein which shall end on a Saturday, Sunday or legal holiday shall extend to 5:00 p.m. of the next full business day.
|
32.6
|
SEVERABILITY. The invalidity of any provision of this Lease shall not affect the enforceability of the remaining provisions of this Lease or any part hereof. In the event that any provision of this Lease shall be declared invalid by a court of competent jurisdiction, the parties agree that such provision shall be construed, to the extent possible, in a manner which would render the provision valid and enforceable or, if the provision cannot reasonably be construed in a manner which would render the provision valid and enforceable, then this Lease shall be construed as if such provision had not been inserted.
|
32.7
|
COUNTERPARTS. This Lease may be executed in any number of counterparts and by the separate parties hereto in separate counterparts, all of which shall be deemed to be an original and one and the same instrument.
|
32.8
|
GOVERNING LAW, JURISDICTION AND VENUE. This Lease shall be governed by, and construed and interpreted in accordance with, the laws of the State of Florida without regard to principles of conflicts or choice of laws. Each of the parties irrevocably and unconditionally: (i) agrees that any suit, action or legal proceeding arising out of or relating to this Lease shall be brought in the courts of record of the State of Florida in Lee County; (ii) consents to the jurisdiction of each such court in any suit, action or proceeding; and (iii) waives any objection which it may have to the laying of venue of any such suit, action or proceeding in any of such courts.
|
32.9
|
TRIAL BY JURY. The parties hereby waive any right they may have under any applicable law to a trial by jury with respect to any suit or legal action which may be commenced by or against the other concerning the interpretation, construction, validity, enforcement or performance of this Lease.
|
32.10
|
RECORDING. Neither this Lease nor a Memorandum thereof shall be recorded in the Public Records of Lee County, Florida.
|
32.11
|
RADON DISCLOSURE AND DISCLAIMER. The following notification is required by Florida law and is provided for your information:
"Radon is a naturally occurring radioactive gas that, when it is accumulated in buildings in sufficient quantities, may present health risks to persons who are exposed to it over time. Levels of radon that exceed Federal and State guidelines have been found in buildings in Florida. Additional information regarding radon and radon testing may be obtained from your country public health unit."
Landlord has not tested for Radon gas at the Property and therefore, makes no representation regarding the presence or absence of such gas. Tenant hereby waives any and all actions against Landlord related to the presence of such gas.
|
32.12
|
EXHIBITS. Each of the Exhibits, as identified on the Index of Exhibits set forth below, are incorporated into and made a part of this Lease.
|
32.13
|
ADDENDUM. Contemporaneously with the execution of this Lease, the parties have also entered into an Addendum to Lease, which is incorporated into and made a part of this Lease.
|
LANDLORD
ALANDA, LTD.,
a Florida limited partnership
|
|||
|
By: | Alanda Corp., a Florida corporation | |
As general partner |
Craig Strugh
|
By: |
/s/ O.J. Buigas, President
|
||
Charlie Moore
|
O.J. Buigas, President
|
|||
Witnesses
|
|
TENANT:
FindWhat.com,
A Nevada Corporation
|
||||
Dave Rae | By: | /s/ Craig A. Pisaris-Henderson | ||
Tony Gargano |
Craig A. Pisaris-Henderson
|
|||
Witnesses
|
President
|
1.
|
PRELIMINARY STATEMENT. The Preliminary Statement is true and correct and, by this reference, is incorporated into and made a part of this Addendum to Lease.
|
2.
|
DEFINED TERMS. Unless otherwise defined herein, all terms shall have the meanings set forth in the Lease.
|
3.
|
COMPLETION GUARANTY. Landlord shall complete the Premises, including the Initial Tenant Improvements, by no later than November 30, 2002, subject only to delays that may be caused by Tenant. In the event that Landlord does not timely complete the Premises, then Landlord shall pay, as liquidated damages for the delay, the holdover rent and any other sums, including additional rent, that Tenant is required to pay under the terms of Tenant's lease for Tenant's then current premises at 12751 Westlinks Drive, Ft. Myers, Florida, commencing December 1, 2002, until such time as the Premises have been completed. Alternatively, Landlord may provide Tenant with suitable alternative space, reasonably acceptable to Tenant, until such time as the Premises have been completed. In the event that the Premises, including the Initial Tenant Improvements, have not been completed by March 31, 2003, then Tenant may terminate the Lease, whereupon the parties shall be released from any further liability or obligations under the Lease.
|
4.
|
RIGHT OF FIRST OFFER.
|
(a)
|
If, at any time after the Commencement Date of the Lease, any additional space (the "Additional Space") within the Office Building shall become vacant and available for leasing to the general public, Landlord shall first offer the Additional Space to Tenant by delivering written notice to Tenant of the availability of the Additional Space. Tenant shall have ten (10) days after receipt of Landlord's notice within which to elect to lease the Additional Space at the same rental rate in effect for the Premises, based upon the then current average rental rate in effect, and on the same terms and conditions as set forth in the Lease, except that the term of the lease for the Additional Space shall expire contemporaneously with the expiration of the term of the Lease for the Premises. Further, Landlord shall have no obligation to construct any leasehold improvements on behalf of Tenant, and Tenant shall accept the Additional Space in its then current condition. Upon delivery of the Additional Space, the Lease shall be automatically amended to include the Additional Space, and each party shall, at the request of the other party, execute and deliver an amendment to the Lease to confirm the inclusion of the Additional Space.
|
(b)
|
In the event that Tenant does not timely elect to lease the Additional Space, then Landlord shall be free to offer the Additional Space for lease to any third party at a rental rate (after taking into account any rent or other lease concessions) no less than that offered to Tenant, without regard to the right of first offer granted to Tenant hereunder; provided, however, that Tenant shall retain the right of first offer for any other space within the Office Building that may subsequently become available during the term of the Lease. Nothing herein shall require Landlord to deny to any tenant the right to renew or extend its lease at the expiration of the term thereof. Further, the right of first offer set forth herein shall not apply during the last twenty-four (24) months of the Lease Term or if Tenant has, at any time, exercised either the early termination option set forth in Section 5 of this Addendum to Lease or the relocation option set forth in Section 6 of this Addendum to Lease.
|
5.
|
EARLY TERMINATION.
|
(a)
|
Within sixty (60) days after the occurrence of a Triggering Event, as defined below, Tenant shall have the right to terminate the Lease as to all or any portion of the Premises, upon delivery of not less than sixty (60) days notice (the "Early Termination Date"), and thereby be released from any further obligation thereunder, upon payment to Landlord of an Early Termination Payment in an amount equal to the lesser of:
|
(1)
|
One-half (1/2) of the remaining Rent (including Base Rent and CAM) for the remaining term of the Lease for the portion of the Premises to be surrendered to Landlord; or
|
(2)
|
The sum of: (i) Rent (including Base Rent and CAM) for the twenty-four (24) months following the Early Termination Date for the portion of the Premises to be surrendered to Landlord, and (ii) Landlord's actual cost of the Initial Tenant Improvements (but not to exceed $490,000), or if Tenant has returned less than all of the Premises to Landlord, then such prorated portion of the cost of the Initial Tenant Improvements (up to a maximum total cost of the Initial Tenant Improvements of $490,000) attributable to the portion of the Premises to be surrendered to Landlord.
|
(b)
|
The Early Termination Payment shall be due and payable as a single lump sum payment on or before the Early Termination Date. Provided that Tenant leaves all or that portion of the Premises for which Tenant has elected to terminate the Lease in good condition, normal wear and tear excepted, and except in the event of a partial termination, the security deposit shall be returned to Tenant in accordance with the terms of the Lease.
|
(c)
|
For purposes of this section, the term "Triggering Event" shall mean any one or more of the following events: (i) a bona fide sale of a majority of the voting common stock of the Tenant in a single transaction; (ii) a bona fide sale of substantially all of the assets of the Tenant in a single transaction; (iii) the merger or consolidation of Tenant with another business entity resulting in a change of majority ownership; or (iv) the relocation by Tenant of all or a portion of its business operations to a geographic location other than Lee, Collier, Sarasota or Charlotte Counties, Florida.
|
(d)
|
In the event that Tenant terminates the Lease as to less than all of the Premises, the Base Rent shall be adjusted by an amount equal to the portion of the Base Rent attributable to the portion of the Premises returned to Landlord, with a corresponding adjustment in Tenant's Pro Rata Share of the Common Area Maintenance Expenses. In the event that Tenant terminates the Lease as to less than an entire floor, the portion of the Premises returned to Landlord shall consist of at least 5,000 sq. ft of contiguous space with adequate access to the common areas. Further, Tenant may terminate the Lease as to less than all of the Premises, no more than three (3) times during the term of the Lease.
|
6.
|
RELOCATION OPTION.
|
(a)
|
Tenant shall have the option, exercisable by delivery of written notice to Landlord of relocating from all or any portion of the 3rd and 4th floors of the Office Building to alternative space (the "Alternative Space"), at a lower rental rate, as follows:
|
(1)
|
at any time during the first three (3) Lease Years, within a building(s) to be constructed by Landlord within the Summerlin Center Professional Park; or
|
(2)
|
at any time during the term of the Lease, within a building to be constructed by Landlord within a five (5) mile radius of the Premises.
The Alternative Space shall be of comparable or greater square footage as the vacated space, and each party's obligation hereunder shall be subject to the ability of the parties to reach final agreement on the plans and specifications for the Alternative Space. Tenant's notice shall identify the portion of the Premises to be surrendered to Landlord and shall identify any special needs that Tenant may have for the Alternative Space.
|
(b)
|
The Base Rent for the Alternative Space shall be calculated based upon the market rental rate for comparable space within the general vicinity of the Office Building (the "Market Rate"). In the event that the parties are unable to reach agreement on the Base Rent for the Alternative Space, then, at the request of either party, Landlord and Tenant shall mutually select an independent MAI appraiser to determine the Market Rate. If the parties are unable to agree upon a single appraiser, then they shall each select one appraiser, and the two (2) appraisers shall select a third appraiser to determine the Market Rate. Any appraisal costs shall be borne equally by the parties.
|
(c)
|
Upon delivery of the Alternative Space, Tenant shall have a period of thirty (30) days to vacate the portion of the Premises to be surrendered to Landlord, at which time the Base Rent shall be reduced by an amount equal to the portion of the Base Rent attributable to the portion of the Premises returned to Landlord and increased by the Base Rent attributable to the Alternative Space, with a corresponding adjustment in Tenant's Pro Rata Share of the Common Area Maintenance Expenses. Upon delivery of the
Alternative Space to Tenant, each party shall, at the request of the other party, execute and deliver an amendment to the Lease to confirm the exclusion of the portion of the Premises vacated by Tenant and the inclusion of the Alternative Space.
|
(d)
|
In the event that Tenant relocates less than an entire floor, the portion of the Premises returned to Landlord shall consist of at least 5,000 sq. ft. of contiguous space with adequate access to the common areas. If Landlord is not able to provide Tenant with Alternative Space within twelve (12) months after the receipt of notice from Tenant, then Tenant shall have the right to terminate this Lease as to that portion of the Premises for which Tenant has requested Alternative Space.
|
7.
|
EXPANSION SPACE.
|
(a)
|
In the event that Tenant shall, at any time during the first three (3) Lease years, determine that Tenant will require any additional space, but in no event less than 5,000 sq. ft. and in no event more than 30,000 sq. ft. (the "Expansion Space"), then Tenant shall so notify Landlord. Tenant's notice shall identify the amount of Expansion Space required by Tenant and shall identify any special needs that Tenant may have for the Expansion Space. Upon receipt of Tenant's notice, Landlord shall endeavor to provide Tenant with suitable Expansion Space, reasonably acceptable to Tenant, within the Office Building or, within a building(s) to be constructed by Landlord within the Summerlin Center Professional Park.
|
(b)
|
The Base Rent for the Expansion Space shall be calculated based upon the market rental rate for comparable space within the general vicinity of the Expansion Space (the "Market Rate"). In the event that the parties are unable to reach agreement on the Base Rent for the Expansion Space, then, at the request of either party, Landlord and Tenant shall mutually select an independent MAI appraiser to determine the Market Rate. If the parties are unable to agree upon a single appraiser, then they shall each select one appraiser, and the two (2) appraisers shall select a third appraiser to determine the Market Rate. Any appraisal costs shall be borne equally by the parties.
|
(c)
|
Upon delivery of the Expansion Space to Tenant, the Lease shall be automatically amended to include the Expansion Space, and each party shall, at the request of the other party, execute and deliver an amendment to the Lease to confirm the inclusion of the Expansion Space. Alternatively, Tenant shall, at the request of Landlord execute a separate lease for the Expansion Space containing terms and conditions substantially the same as the Lease.
|
(d)
|
If Landlord is not able to provide Tenant with the Expansion Space, within the Office Building or within Summerlin Center Professional Park, within twelve (12) months after the receipt of notice from Tenant, then Tenant shall have the right, exercisable within sixty (60) days thereafter, to notify Landlord of its election to seek alternative space to satisfy its requirements for the Expansion Space and/or to terminate this Lease. In the event that Tenant elects to terminate the Lease, then Tenant shall return the Premises to Landlord in the condition required by the Lease, within ninety (90) days after delivery of Tenant's notice. Provided that Tenant returns the Premises to Landlord in the condition required by the Lease, Tenant shall be entitled to the return of its security deposit and shall be discharged from any further obligation under the Lease from and after the termination date.
|
(e)
|
To the extent that Landlord has provided Tenant with Expansion Space under this Section 7, Landlord shall be relieved of its obligation to provide Tenant with Alternative Space pursuant to Section 6. Conversely, to the extent that Tenant has exercised its right to relocate to Alternative Space pursuant to Section 6, Landlord shall be relieved of its obligation to provide Tenant with Expansion Space pursuant to this Section 7.
|
8.
|
ABSENCE OF DEFAULT. Upon the occurrence of any Event of Default by Tenant under the terms of the Lease, which has not been cured within any applicable grace or notice provisions, the rights granted to Tenant under the provisions of Sections 4, 5, 6 and 7 of this Addendum shall automatically terminate and be of no further force and effect.
|
9.
|
TIME TO PERFORM. All time periods set forth in this Addendum shall be subject to the provisions of Section 21 of the Lease.
|
10.
|
PRESS RELEASE. Landlord and Tenant shall agree upon a mutual press release to be issued upon the execution of the Lease.
|
11.
|
RATIFICATION. All other terms of the Lease are hereby ratified and confirmed In the event of any inconsistencies between the terms of this Addendum and the terms of the Lease, the terms of this Addendum shall control.
|
ALANDA, LTD.,
|
|||
a Florida limited partnership
By: Alanda Corp., a Florida
corporation,as general partner
|
Craig Strugh
|
By: |
/s/ OJ Buigas
|
||
OJ Buigas, President
|
||||
Charlie Moore |
FindWhat.com,
A Nevada Corporation
|
||||
Craig Strugh
|
By: | /s/ Craig A. Pisaris-Henderson | ||
Craig A. Pisaris-Henderson
|
||||
Tony Gargaro
|
President
|
1.
|
Preliminary Statement. The Preliminary Statement is true and correct and, by this reference, is incorporated into and made a part of this Third Amendment.
|
2.
|
Definitions. All terms shall have the meanings given to them in the Lease, unless otherwise defined herein. All references to the Lease shall mean the Lease as previously amended.
|
3.
|
Premises. The parties agree that the Premises shall mean the 4th and 5th floors of the Office Building.
|
4.
|
Size of Premises. The parties agree that the Premises, as constructed, shall consist of 21,981 rentable square feet.
|
5.
|
Rent. Effective December 1, 2009, Tenant shall be obligated to pay Annual Base Rent in the amount of $371,698.72, at a rate of $16.91 per square foot, payable in equal monthly installments of $ 30,974.89, together with sales tax thereon, in accordance with the provisions set forth in Section 4.1 of the Lease and which shall also be subject to Annual Rent Increases, as set forth in Section 4.2 of the Lease.
|
6.
|
Tenant Estimated Pro Rata Share. Effective December 1, 2009, Tenant’s Pro Rata Share shall be 21,981 sq. ft./51,653 sq. ft. (i.e. 42.60%). For the calendar year 2009, Tenant’s Estimated Pro Rata Share of the Common Area Expense is estimated to be $11,082.08 per month or $6.05 per square foot and shall be subject to annual adjustment in accordance with Section 4.3.1.
|
7.
|
Rights and Obligations. Tenant hereby relinquishes any and all rights that it may have, under the terms of the Lease, to the portions of the Premises located on the 1st, 2nd and 3rd floors of the Office Building. Further, Tenant is hereby relieved of any and all of its obligations, under the terms of the Lease, relating to the portions of the Premises located on the 1st 2nd and 3rd floors of the Office Building,
|
8.
|
Security Deposit. Tenant shall deliver directly to Landlord Accudata’s security deposit, in the amount of $48,000.00 (the “Accudata Deposit”), which was delivered to Tenant under the terms of a separate Sublease between Tenant and Accudata.
|
9.
|
Signage Rights. Tenant hereby relinquishes any and all rights that it may have under the terms of the Lease relating to the placement of signage on the exterior of the Office Building.
|
10.
|
Parking. Section 10 of the Second Addendum of the Lease, as amended by Section 4(b) of the Second Amendment to the Lease, is hereby amended and restated in its entirety to read, as follows:
|
11.
|
Counterparts. This Lease may be executed in any number of counterparts and by the separate parties hereto in separate counterparts, all of which shall be deemed to be an original and one and the same instrument.
|
12.
|
Ratification. All other terms and provisions of the Lease are hereby ratified and confirmed and shall remain in full force and effect, except to the extent amended hereby. Each party represents and warrants to the other party that it is aware of no default by the other party under the terms of the Lease as of the date hereof. In the event on any inconsistency between the terms of this Second Amendment and the terms of the Lease, the terms of this Second Amendment shall control.
|
Signed, sealed and delivered
|
|
|
|
in the presence of:
|
|
|
|
|
|
|
|
WITNESSES:
|
|
Landlord:
|
|
|
|
|
|
|
|
By:
|
|
|
|
|
Mick Vorbeck
|
WITNESSES:
|
Tenant:
|
||
Vertro, Inc., formerly known as
FindWhat.com corporation
|
|||
By:
|
|||
Name:
|
|||
Title:
|
1.
|
Preliminary Statement. The Preliminary Statement is true and correct and, by this reference, is incorporated into and made a part of this Third Amendment.
|
2.
|
Definitions. All terms shall have the meanings given to them in the Lease, unless otherwise defined herein. All references to the Lease shall mean the Lease as previously amended.
|
3.
|
Premises. The parties agree that the Premises shall mean 5th floor of the Office Building.
|
4.
|
Size of Premises. The parties agree that the Premises, as constructed, shall consist of 10,940 rentable square feet.
|
5.
|
Rent. Effective April 12, 2010, Tenant shall be obligated to pay Annual Base Rent in the amount of $188,386.80, at a rate of $17.22 per square foot, payable in equal monthly installments of $15,698.90, together with sales tax thereon, in accordance with the provisions set forth in Section 4.1 of the Lease, plus Additional Rent as set forth in the Lease and which shall also be subject to Annual Rent Increases, as set forth in Section 4.2 of the Lease. The Annual Base Rent for April 2010 shall be prorated on a per diem basis.
|
6.
|
Consult-A-Nurse Rent. The parties acknowledge that: (i) the Consult-A-Nurse’s Annual Base Rent for the 4th floor of the Office Building is based upon a rate of $12.00 per rentable square foot; (ii) the Annual Base Rent for the 4th floor under the terms of this Lease is based upon a rate of $16.60 per rentable square foot; (iii) the differential between the rental rate under the Consult-A-Nurse Lease and this Lease is $4.60 per rentable square foot (“Rent Differential”) and (iv) commencing April 6, 2010, and on the first day of each month thereafter for three (3) months, Tenant shall pay directly to Landlord three (3) monthly installments of $10,940.00, plus sales, use and other taxes, representing the first three (3) months of the Base Rent under the Consult-a-Nurse Lease. Accordingly, effective April 12, 2010 and throughout the remaining Term of this Lease, Tenant shall be obligated to pay directly to Landlord the annual amount of $50,324.00, payable in equal monthly installments of $4,193.67, together with sales tax thereon, in accordance with the provisions set forth in Section 4.1 of the Lease and which shall also be subject to Annual Rent Increases, as set forth in Section 4.2 of the Lease, in order to compensate Landlord for the Rent Differential. The Consult-a-Nurse Base Rent and the Rent Differential shall be prorated on a per diem basis for the month of April 2010.
|
7.
|
Consult-A-Nurse Additional Rent. The parties acknowledge that Consult-a-Nurse is not paying its Pro Rata Share of Common Area Maintenance Expenses, as set forth in the Consult-a-Nurse Lease. Tenant shall be obligated to pay the Pro Rata Share of Common Area Maintenance Expenses allocable to the 4th Floor, including sales tax and/or other taxes levied or imposed from time to time, throughout the remaining Term of this Lease and therefore Tenant’s Estimated Pro Rata Share as set forth in Section 6 of the Third Amendment shall not be reduced as a result of the Consult-A-Nurse Lease.
|
8.
|
Tenant Improvements. As part of the consideration to induce Consult-A-Nurse to enter into the Lease, Tenant agrees to contribute an amount not to exceed $15,000.00 toward the cost of the Tenant Improvements to be constructed by Consult-A-Nurse; and (ii) certain items of personal property, as listed in on Exhibit “D” to the Consult-A-Nurse Lease, which shall become property of Consult-A-Nurse upon installation in the Premises. Tenant agrees to join in the execution of the Consult-A-Nurse Lease for the limited purpose of confirming its agreement with the foregoing.
|
9.
|
Rights and Obligations. Tenant hereby relinquishes any and all rights that it may have, under the terms of the Lease, to the portions of the Premises located on 4th floor of the Office Building.
|
10.
|
Guaranty. In the event that Consult-A-Nurse defaults under the terms of the Consult-A-Nurse Lease, Tenant shall upon demand be obligated to fulfill Consult-A-Nurse’s obligations, including, among other things, payment of Base Rent and Additional Rent thereunder for the remaining term of this Lease. Tenant shall have the right to seek collection of any amounts paid by Tenant to Landlord as a result of the failure of Consult-A-Nurse to make any payment or to perform any obligation of Consult-A-Nurse under the terms of the Consult-A-Nurse Lease; provided that Landlord has first been paid all amounts due to Landlord thereunder, including without limitation any subsequent amounts due to Landlord under the terms of the Consult-A-Nurse Lease.
|
11.
|
Counterparts. This Lease may be executed in any number of counterparts and by the separate parties hereto in separate counterparts, all of which shall be deemed to be an original and one and the same instrument.
|
12.
|
Ratification. All other terms and provisions of the Lease are hereby ratified and confirmed and shall remain in full force and effect, except to the extent amended hereby. Each party represents and warrants to the other party that it is aware of no default by the other party under the terms of the Lease as of the date hereof. In the event on any inconsistency between the terms of this Fourth Amendment and the terms of the Lease, the terms of this Fourth Amendment shall control.
|
13.
|
Landlord’s Legal Fees. Within ten (10) business days of the date hereof, Tenant shall pay Landlord $10,000 for Landlord’s legal expenses associated with this Fourth Amendment and the Consult-A-Nurse Lease.
|
14.
|
Commission. Any commission payable to Commercial Property of Southwest Florida, LLC in connection with the Consult A Nurse Lease shall be allocated between the parties such that: (i) Tenant shall be responsible for the commission relating to the period between the Commencement Date of the Consult A Nurse Lease and the remaining term of this Lease, and (ii) Landlord shall be responsible for the commission relating to the period following the expiration of the term of this Lease
|
Landlord:
|
|||
By:
|
/s/ Mick Vorbeck
|
||
Mick Vorbeck
|
Tenant:
|
|||
Vertro Inc.,
A Delaware corporation formerly known as Miva, Inc
|
|||
By:
|
/s/ John B. Pisaris
|
||
Name: John B. Pisaris
|
|||
Title: General Counsel
|
SUBLANDLORD: | ||
Vertro, Inc. | ||
5220 Summerlin Commons Blvd. | ||
Fort Myers, FL 33907 | ||
Attn:General Counsel | ||
SUBTENANT: | MIVA AK, Inc. | |
5220 Summerlin Commons Blvd., Suite 400 | ||
Fort Myers FL 33907 | ||
Attn:General Manager | ||
With a copy to:
|
Adknowledge, Inc. | |
3003 Exposition Blvd., First Floor | ||
Santa Monica, CA 90404 | ||
Attn:General Counsel |
SUBLANDLORD:
|
|||
Vertro, Inc.
|
|||
By:
|
/s/ John B. Pisaris
|
||
Name:
|
John B. Pisaris
|
||
Title:
|
General Counsel
|
||
SUBTENANT:
|
|||
MIVA AK, Inc.
|
|||
By:
|
/s/ Sloan Gaon
|
||
Name:
|
Sloan Gaon
|
||
Title:
|
General Manager
|
WITNESSES:
|
GUARANTOR
|
|||
Adknowledge, Inc.
|
||||
By:
|
/s/ Michael Geroe
|
|||
Name:
|
Michael Geroe
|
|||
Title:
|
General Counsel
|
Sate of California
|
)
|
|
)
|
ss
|
|
County of Los Angeles
|
)
|
By:
|
/s/ Leilani Simmons
|
||
Notary Public
|
|||
Print Name: Leilani Simmons
|
|||
My Commission Expires: 9-21-11
|
4.3.1
|
Brand Features. Each party shall own all right, title and interest, including without limitation all Intellectual Property Rights, relating to its Brand Features. Some, but not all examples of Google Brand Features are located at: http://www.google.com/permissions/trademarks.html (or such other URLs Google may provide from time to time). Except to the limited extent expressly provided in this Agreement, neither party grants, and the other party shall not acquire, any right, title or interest (including, without limitation, any implied license) in or to any Brand Features of the first party; and all rights not expressly granted herein are deemed withheld. All use by Google of Customer Brand Features (including any goodwill associated therewith) shall inure to the benefit of Customer and all use by Customer of Google Brand Features (including any goodwill associated therewith) shall inure to the benefit of Google. No party shall challenge or assist others to challenge the Brand Features of the other party (except to protect such party’s rights with respect to its own Brand Features) or the registration thereof by the other party, nor shall either party attempt to register any Brand Features or domain names that are confusingly similar to those of the other party.
|
4.3.2
|
License to Google Brand Features. Subject to the terms and conditions of this Agreement, Google grants to Customer a limited, nonexclusive and nonsublicensable license during the Services Term to display those Google Brand Features expressly authorized for use in this Agreement, solely for the purposes expressly set forth herein. ***Furthermore, in its use of any Google Brand Feature, Customer agrees to adhere to Google’s then current Brand Feature use guidelines, and any content contained or referenced therein, which may be found at the following URL: http://www.google.com/permissions/guidelines.html (or such other URL Google may provide from time to time).
|
10.2.1
|
General. Either party may suspend performance and/or terminate this Agreement, in whole or in part: (i) if the other party materially breaches any material term or condition of this Agreement and fails to cure such breach within thirty (30) days after receiving written notice thereof; or (ii) if the other party becomes insolvent or makes any assignment for the benefit of creditors or similar transfer evidencing insolvency, or suffers or permits the commencement of any form of insolvency or receivership proceeding, or has any petition under bankruptcy law filed against it, which petition is not dismissed within sixty (60) days of such filing, or has a trustee, administrator or receiver appointed for its business or assets or any part thereof.
|
10.2.2
|
Google Termination Rights. Google may terminate this Agreement, or the provision of any Service hereunder, immediately upon written notice: (i) if Customer breaches Section 3.1 (Prohibited Actions) of this GSA, Section 4.3 (License Grants; Brand Features) of this GSA, or Section 9.1 (Confidentiality) of this GSA or the exclusivity provisions contained in the Order Form; (ii) if Customer is in material breach of this Agreement more than two (2) times notwithstanding any cure of such breaches; (iii) ***; or (iv) as otherwise provided in the Order Form.
|
|
|
10.2.3
|
Suspension and Termination in the Event of an Injunction. Google may suspend performance under this Agreement in whole or in part with immediate effect if, as a result of a claim alleging facts that would constitute a breach of Customer’s representations and warranties made in subsections (b) and (c) of the second sentence of Section 6, Google is obliged by final or temporary court order or magisterial decision to temporarily or permanently refrain from continuing to perform its obligations under this Agreement. Google’s rights under this provision shall become effective on the date of the court order or magisterial decision or on the date of the service of the order irrespective of the possibility of appeal. If any suspension under this paragraph continues for more than six (6) months, Google may terminate this Agreement in whole or in part with immediate effect.
|
Google: GOOGLE INC.
|
Customer: MIVA, INC.
|
|||||||
By:
|
/s/ Sanjay Kapoor
|
By:
|
/s/ Peter Corrao
|
|||||
Print Name:
|
Sanjay Kapoor
|
Print Name:
|
Peter Corrao
|
|||||
Title:
|
Sr. Director, Strategic Partnerships
|
Title:
|
President & CEO
|
|||||
Date:
|
11/10/2008
|
Date:
|
11/10/08
|
Google Inc.
1600 Amphitheatre Parkway
Mountain View, CA 94043
Tel: (650) 623-4000
Fax:(650) 618-2678
|
Google Services Agreement
ORDER FORM
|
Google SPD Rep: ***
Google SPD Director: ***
Google Sales Engineer: ***
Google Legal Contact: ***
|
CUSTOMER (FULL LEGAL NAME): MIVA, Inc.
|
GSA Effective Date: December 27, 2006
|
NDA Effective Date: ***
|
|
Corporate Contact Information:
|
Billing Contact Information:
|
Legal Notices to:
|
|
Attention:
|
***
|
***
|
***
|
Title:
|
***
|
***
|
***
|
Address, City, State, Postal Code, Country:
|
143 Varick Street, New York, NY 10013
|
5220 Summerlin Commons Blvd, Ft. Myers, FL 33907
|
5220 Summerlin Commons Blvd, Ft. Myers, FL 33907
|
Phone:
|
***
|
***
|
***
|
Fax:
|
***
|
***
|
***
|
Email:
|
***
|
***
|
***
|
Technical Contact:
|
***
|
***
|
***
|
Customer Wire Transfer Info (if applicable): ***
|
D&B DUNS Number: ***
|
VAT/Tax Number: ***
|
|
Order Form Effective Date: January 1, 2009
|
Initial Services Term: ***
|
SEARCH SERVICES
|
Search Fees
|
Safe Search
(Check if applicable)
|
Language Restrict
(Check if applicable)
|
Country/Location Restrict
(Check if applicable)
|
||||
x WebSearch Services ***
|
***
|
o SafeSearch
o High
o Medium
o Off
|
o If checked, specify languages:
|
o If checked, specify country:
|
ADSENSE FOR SEARCH (“AFS”)
|
Customer’s AFS
Revenue Share
Percentage (%)
|
AFS Deduction
Percentage (%)
|
Specifications
|
|||
x AdSense for Search ***
|
***
|
***
|
***
|
|||
Optional AdSense for Search Features:
(check the applicable boxes)
|
o AdSafe
Level: o High o Medium o Low o Off o Adult Only
|
Customer PO #: o
Credit Check Complete
|
Currency:
x US Dollar
o Japanese Yen
o Other:
|
|
· syndication-support@google.com
|
Google: GOOGLE INC.
|
Customer: MIVA, INC.
|
||||
By:
|
/s/ Sanjay Kapoor
|
By:
|
/s/ Peter Corrao
|
||
Print Name: Sanjay Kapoor
|
Print Name: Peter Corrao
|
||||
Title: Sr. Director, Strategic Partnerships
|
Title: President & CEO
|
||||
Date: 11/10/2008
|
Date: 11/10/08
|
1.
|
Pursuant to Section 2 (Services Term) of the Order Form, the Parties agree that the Renewal Term of the Order Form is January 1, 2011 to December 31, 2012, unless either party notifies the other party of its intent to not continue this Agreement after December 31, 2011 by delivering written notice thereof at least sixty (60) days prior to December 31, 2011.
|
2.
|
(a) The list of (i) WebSearch Sites in the table for WebSearch Services on the first and second pages of the Order Form and (ii) AFS Sites in the table for AdSense for Search on the third page of the Order Form are each hereby amended and restated to include only the following: ***.
(b) The list of Client Applications approved for (i) WebSearch Services in the table for WebSearch Services on the first and second pages of the Order Form and (ii) AFS Service in the table for AdSense for Search on the third page of the Order Form are each hereby amended and restated to include only the following: ***.
(c) Except as described in paragraphs (a) and (b) of this Section 2, the table for WebSearch Services on the first and second pages of the Order Form and the table for AdSense for Search on the third page of the Order Form each remain in full force and effect.
|
3.
|
The following definitions are added to Section 3 (Defined Terms) of the Order Form:
3.29. “End User Query" means (a) a text query entered and submitted into a WebSearch Box on the Site(s) or Client Applications by an End User, or (b) a click by an End User on a Related Keyword that generates a Related Search.
3.30. “Google Branding Guidelines” means the brand treatment guidelines applicable to the Services and located at the following URL: http://www.google.com/wssynd/02brand.html (or a different URL Google may provide to Customer from time to time).
3.31. “Related Keywords” means text links consisting of keywords which are automatically selected and provided by Google and which generate a Related Search.
3.32. “Related Search” means an End User Query that is generated by an End User clicking on a Related Keyword, provided that Customer complies with the additional terms set forth in Exhibit D.
|
4.
|
The following sentence is hereby added to the end of Section 4.2(a) (Search Boxes and Queries) of the Order Form: ***.
|
5.
|
Section 4.3.2 (License to Google Brand Features) of the GSA is hereby deleted in its entirety. Section 4.2(c) (Labeling, Branding and Attribution) of the Order Form is hereby deleted and replaced with the following:
Google grants to Customer a non-exclusive and non-sublicensable license during the Services Term to use the Google Brand Features solely to fulfill Customer’s obligations in connection with the Services in accordance with this Agreement and the Google Branding Guidelines. ***. Any goodwill resulting from the use by Customer of the Google Brand Features will belong to Google. Google may include Customer’s Brand Features in customer lists. Google will provide Customer with a sample of this usage if requested by Company. Nothwithstanding the foregoing, WebSearch Boxes and WebSearch Results Sets located on approved Starware branded WebSearch Sites and all WebSearch Client Applications shall not have any Google labeling, branding or attribution.
|
Google Confidential
|
1
|
6.
|
The following sentence is hereby added to the beginning of Section 5.2(a) (AFS Queries) of the Order Form: ***
|
7.
|
Section 14 *** of the Order Form is hereby deleted and replaced with the following: ***
|
8.
|
Section 15.2 (AdSense for Search) of the Order Form is hereby deleted and replaced with the following: ***
|
9.
|
The following sentence is hereby added as Section 15.4(c) of the Order Form:
|
10.
|
The following sentence is hereby added as Section 5.4 of the Order Form:
|
(i)
|
clearly discloses to End Users that third parties may be placing and reading cookies on End Users’ browsers, or using web beacons or similar technologies to collect information in the course of advertising being served on the Site(s); and
|
|
(ii)
|
includes information about End Users’ options for cookie management.
|
11.
|
Annex 1 h ereto is added as Exhibit D of the Order Form.
|
12.
|
Customer acknowledges and agrees that Google may update the Client Application Guidelines from time to time at its sole discretion, as set forth in Section 6 (Client Application) of the Order Form.
|
13.
|
Except as modified by this amendment, the Agreement remains in full force and effect. This amendment may be executed in counterparts, including facsimile counterparts.
|
Google: GOOGLE INC.
|
Customer: VERTRO, INC.
|
||||
By:
|
/s/ Nikesh Arora
|
By:
|
/s/ Peter A. Corrao
|
||
Print Name: Nikesh Arora
|
Print Name: Peter A. Corrao
|
||||
Title: President, Global Sales and Business Development
|
Title: President & CEO
|
||||
Date: 12/2/2010
|
Date: 12/2/2010
|
Google Confidential
|
2
|
1.
|
***
|
Google Confidential
|
3
|
Google Confidential
|
4
|
Inuvo, Inc.
|
Nevada Corporation
|
|
Morex Marketing Group, LLC / BabytoBee
|
New York Limited Liability Company
|
|
Kidzadu, Inc.
|
Florida Corporation
|
|
ValidClick
|
Missouri Corporation
|
|
Check-Up Marketing, Inc.
|
North Carolina Corporation
|
|
MarketSmart Advertising, Inc.
|
North Carolina Corporation
|
|
Rightstuff, Inc.
|
North Carolina Corporation
|
|
Exact Supplements, LLC
|
Florida Limited Liability Company
|
|
Home Biz Ventures, LLC
|
Florida Limited Liability Company
|
|
Vintacom Florida, Inc.
|
Florida Corporation
|
|
Real Estate School Online, Inc.
|
Florida Corporation
|
|
iLead Media, LLC
|
Delaware Limited Liability Company
|
|
Kowabunga Marketing, Inc.
|
Michigan Corporation
|
|
PrimaryAds, Inc.
|
New Jersey Corporation
|
|
Vertro, Inc.
|
Delaware Corporation
|
|
ALOT, Inc.
|
Delaware Corporation
|
|
Varick & Spring I, Inc.
|
Delaware Corporation
|
|
Varick & Spring (MSB), Inc.
|
Delaware Corporation
|
|
Who Midco Corporation
|
Delaware Corporation
|
|
Varick and Spring II, Inc.
|
Delaware Corporation
|
|
Varick and Spring UK, Limited
|
United Kingdom
|
|
Varick and Spring (Deutschland) GmbH
|
Germany
|
March 27, 2012
|
By:
|
/s/ Mayer Hoffman McCann P.C. | |
Mayer Hoffman McCann P.C. | |||
Clearwater, Florida |
1.
|
I have reviewed this annual report on Form 10-K for the year ended December 31, 2011 of Inuvo, Inc.;
|
||||
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
||||
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
||||
4.
|
The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
||||
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including our consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
||||
(b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
||||
(c)
|
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
||||
(d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
||||
5.
|
The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
|
||||
(a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
|
||||
(b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
|
March 28, 2012
|
By:
|
/s/ Pete A. Corrao | |
Peter A. Corrao,
Chief Executive Officer, principal executive officer
|
1.
|
I have reviewed this annual report on Form 10-K for the year ended December 31, 2011 of Inuvo, Inc.;
|
||||
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
||||
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
||||
4.
|
The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
||||
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including our consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
||||
(b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
||||
(c)
|
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
||||
(d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
||||
5.
|
The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
|
||||
(a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
|
||||
(b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
|
March 28, 2012
|
By:
|
/s/ Wallace D. Ruiz | |
Wallace D. Ruiz, | |||
Chief Financial Officer, principal financial and accounting officer |
1.
|
The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended, and
|
2.
|
The information contained in the Report fairly presents, in all material respects, the financial conditions and results of operations of the Company.
|
March 28, 2012
|
By:
|
/s/ Peter A. Corrao | |
Peter A. Corrao, | |||
Chief Executive Officer, principal executive officer |
1.
|
The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended, and
|
2.
|
The information contained in the Report fairly presents, in all material respects, the financial conditions and results of operations of the Company.
|
March 28, 2012
|
By:
|
/s/ Wallace D. Ruiz | |
Wallace D. Ruiz, | |||
Chief Financial Officer, principal financial and accounting officer |
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