Sample Business Contracts

Virginia-Reston-12020 Sunrise Valley Drive Sublease - RMS International Inc., Vistarms Inc. and Tel-Save Inc.

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  • Commercial Lease. Start a state-specific lease for the rental of commercial property. Specify the term and rent due, as well as whether the landlord or tenant is responsible for property taxes, insurance, and maintenance and repairs.
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  • Sublease Agreement. Tenants of residential property should prepare a sublease agreement if they are seeking to sublease a room or the entire apartment or house to a third party. All parties should review the original lease agreement to see if there are any restrictions on subletting or assigning the premises.
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                               SUBLEASE AGREEMENT

     This Sublease made the 20th day of January,  1999 (this  "Sublease") by and
between  RMS  INTERNATIONAL,   INC.,  now  doing  business  as  VISTARMS,   INC.
(hereinafter   called   "Sublandlord")   and  TEL-SAVE,   INC.,  a  Pennsylvania
Corporation (hereinafter called "Subtenant").


     WHEREAS,  GEMINI  AIR  CARGO,  INC.,  as  successor-in-interest  to POTOMAC
FINANCIAL GROUP, L.L.C., entered into that certain Lease dated as of October 26,
1995 with Reston  Plaza Office  L.L.C,  as  successor-in-interest  to Aetna Life
Insurance Company,  as lessor  (hereinafter  called "Prime  Landlord"),  for the
lease of certain premises on the second floor of Prime Landlord's  building know
as Reston Plaza II,  located at 12020 Sunrise Valley Drive,  Suite 250,  Reston,
Virginia 22091 containing  approximately  3,723 square feet (the "Premises") per
Exhibit "A" attached to this agreement,  to which lease  (hereinafter the "Prime
Lease") reference is hereby made as if the same were fully set forth herein;

     WHEREAS,  RMS  INTERNATIONAL,  INC.,  entered  into that  certain  Sublease
commencing   on   January   21,   1997  with   GEMINI  AIR   CARGO,   INC.,   as
successor-in-interest  to POTOMAC FINANCLAL GROUP, L.L.C. ("First  Sublandlord")
for the sublease of the Premises per Exhibit "B" attached to this agreement,  to
which sublease (hereinafter the "First Sublease") reference is hereby made as if
the same were fully set forth herein;

     WHEREAS,  the parties to this Sublease have agreed that  Sublandlord  shall
sublet the premises to Subtenant.

     NOW,  THEREFORE,  in consideration  of the covenants set forth herein,  the
parties covenant agree as follows:

     1. Premises:  Term.  Sublandlord hereby subleases the Premises to Subtenant
for term  ("Term")  commencing on or about the earlier of occupancy by Subtenant
of the  Premises  or  February 1, 1999 (the  "Sublease  Commencement  Date") and
ending at 11:59 p.m.  E.S.T.  on  November  30, 2000 (the  "Sublease  Expiration
Date'), unless sooner terminated in accordance herewith.  Sublandlord has agreed
to paint the interior walls of the Premises, and agrees to shampoo and clean the
carpet  before the  Sublease  Commencement  Date;  otherwise,  Subtenant  hereby
accepts the Premises in their "as-is" condition.

     Sublandlord  shall make  available  to  Subtenant  all parking  spaces made
available to it under the First  Sublease,  being thirteen (13) parking  spaces,
two (2) of which are  covered,  subject  to the terms of Section 45 of the Prime

     2.  Termination.  Upon the  expiration or sooner  termination  of the Prime
Lease for any reason, or upon the surrender of the Prime Lease by Sublandlord to
the Prime Landlord,  at Prime  Landlord's  option,  this Sublease  Agreement and
Subtenant's  rights hereunder shall


terminate as of the date of such  expiration,  termination or surrender,  as the
case may be, and the Subtenant shall vacate the Premises on such date.

     3. Rent.  Subtenant  shall pay the Sublandlord an annual rental at the rate
of Ninety Four Thousand Five and 75/100 Dollars  ($94,005.75)  per annum ("Basic
Rent"),  in equal monthly  installments  of Seven  Thousand Eight Hundred Thirty
Three and 81/100 Dollars  ($7,833.81) per month ("Basic Monthly Rent"), plus the
Additional Rent as hereinafter defined in Paragraph 4 below (the Additional Rent
and the Basic Rent hereinafter  collectively  referred to as "Rent").  The first
installment  of Basic  Monthly Rent shall be due and payable upon the  execution
hereof.  On each anniversary of the Sublease  Commencement  Date, the Basic Rent
shall be  increased by an amount equal to five percent (5%) of the Basic Rent in
effect during the preceding  Lease Year.  Except as otherwise  provided  herein,
Subtenant  shall pay the Rent in equal  monthly  installments  in advance on the
first day of each and every month during the Term. In the event that at any time
during the Term,  Subtenant  shall have a claim against  Sublandlord,  Subtenant
shall have no right to deduct the amount  allegedly owed Subtenant from the Rent
or other sums payable to Sublandlord  hereunder,  it being understood and agreed
that Subtenant's sole remedy in such event shall be to institute and independent
action against Sublandlord therefor.

     Subtenant shall receive a rent abatement of its rent under this Sublease to
the extent the First Sublandlord is entitled to a rent abatement under Article 8
and 13 of the  Prime  Lease.  Subtenant  shall  have a right  to  terminate  the
Sublease to the extent the First  Sublandlord is entitled to terminate the Prime
Lease pursuant to Article 13 of the Prime Lease.

     4.  Additional  Rent.  Subtenant  shall not pay Tenant's  Share of Property
Taxes  pursuant to Section 10 of the Prime Lease or Tenant's  Share of Operating
Costs  pursuant  to  Section 9 of the Prime  Lease.  With  respect  to any other
additional rent or other sums charged to Sublandlord, Subtenant shall pay for it
at the rates  charged by Prime  Landlord  under the Prime  Lease.  If  Subtenant
procures any additional  services from the Prime  Landlord,  Subtenant shall pay
for it at the same  rates  charged  by the Prime  Landlord  and shall  make such
payments as Prime Landlord may direct.  All sums payable by the Subtenant  under
this paragraph 4 shall be deemed  "Additional  Rent" and shall be collectable as

     5.  Services.  Except as otherwise  provided  herein,  the only services or
rights to which Subtenant is entitled under this Sublease Agreement are those to
which Sublandlord is entitled as lessee under the Prime Lease and Subtenant will
look  solely  to  Prime  Landlord  for all such  services  and  rights,  but (at
Subtenant's  request)  Sublandlord  shall assist  Subtenant  with obtaining such
services and rights.

     6. Permitted  Uses. The Premises shall be used for general office  purposes
and  related  uses  only and for no other  purpose.  Subtenant  shall not use or
occupy the  Premises,  nor permit the Premises to be used or  occupied,  for any
illegal purposes or in any unlawful or illegal manor nor in any manner to create
any nuisance or trespass.


     7.  Compliance:  Indemnification.  Subtenant shall neither cause nor suffer
any act or  omission  that  would  cause the  Prime  Lease to be  terminated  or
forfeited  because of any right of termination or forfeiture  reserved or vested
in the Prime Landlord, and Subtenant will indemnify, defend and hold Sublandlord
harmless  against  all  claims of any kind by reason of any breach or default on
the part of or by Subtenant's officers, agents, employees, contractors, invitees
or licensees, by reason on which the Prime Lease may be terminated or forfeited.
Subtenant  represents  that it has read and is  familiar  with the  terms of the
Prime Lease.

     Sublandlord agrees that Sublandlord will not (i) take any action or omit to
take any action  which would  constitute a voluntary  surrender  under the First
Sublease or a default  thereunder  resulting in the termination of this Sublease
and/or  Subtenant's  eviction hereunder or (ii) amend the First Sublease without
the consent of Subtenant. Sublandlord agrees to pay in a timely fashion the base
rent,  additional  rent and any other charges  payable by  Sublandlord  to First
Sublandlord  under the First  Sublease and to comply with all other  obligations
under the First Sublease and the Prime Lease.

     8. Hold  Harmless.  Subtenant  hereby agrees to indemnify,  defend and hold
Prime Landlord and  Sublandlord  harmless  against all costs,  damages,  claims,
liabilities  and  expenses  (including,  without  limitation,  attorneys'  fees)
suffered by or claimed against  Sublandlord,  directly or indirectly,  based on,
arising  out of or  resulting  from (i)  Subtenant's  use and  occupancy  of the
Premises  or the  business  conducted  by  Subtenant  therein,  (ii)  any act of
omission by Subtenant or Subtenant's agents, officers,  employees,  contractors,
invitees  or  licensees,  or (iii) any  breach or default  by  Subtenant  in the
performance  or observance of its covenants or  obligations  under this Sublease
(including the covenants and  obligations of the Subtenant under the Prime Lease
as incorporated herein).

     9.  Assignment:  Subletting.  Subtenant  shall not assign this  Sublease or
sublet  the  Premises  in whole or in part,  and  shall not  permit  Subtenant's
interest  in this  Sublease  to be  encumbered  or vested in any third  party by
operation  of law or  otherwise,  unless prior  written  approval is obtained by
Sublandlord, First Sublandlord and Prime Landlord.

     Notwithstanding anything contained herein to the contrary,  Subtenant shall
have the right (upon written notice to Sublandlord,  First Sublandlord and Prime
Landlord),  without the  requirement of obtaining any of such parties'  consent,
(i) to assign this Sublease or sublease all or any portion of the Premises to an
entity which is the parent of Subtenant,  subsidiary of Subtenant,  affiliate of
Subtenant, or shall directly or indirectly control, be controlled by or be under
common  control with  Subtenant  and (ii) to assign this  Sublease in connection
with the sale of all or substantially all of Subtenant's business or a merger or
consolidation  of Subtenant (or its parent) into or with another company to such
acquirer or succeeding entity.



     10.  Notices.  Any notice or demand  which either party may or must give to
the other  under  this  Sublease  Agreement  shall be in writing  and  delivered
personally or sent by registered or certified  mail  addressed if to Sublandlord
as follows:

950 Herndon Parkway
Suite 360
Herndon, Virginia 20170
Attn: Carrie Turley, Office Manager


Tel-Save, Inc.                                  Tel-Save, Inc.
6805 Route 202                                  12020 Sunrise Valley Drive
New Hope, Pennsylvania 18938                    Suite 250
Attn: Gabriel Battista, CEO                     Reston, Virginia 20191
                                                Attn: Gabriel Battista, CEO

with a copy in both cases to:
Arnold & Porter
555 12th  Street, N.W.
Washington, D.C. 20004
Attn: Jennifer Perkins

Either party may, by notice in writing,  direct that future notices or demand be
sent to a  different  address.  Notice  shall be deemed to have been  given when
received by the parry to whom  addressed (or the date which delivery is refused,
as the case may be).

     11. No  Partnership.  Nothing herein  contained in this Sublease  Agreement
shall be deemed or construed as creating the relationship of principal and agent
or of  partnership  or  joint  venture  between  the  parties  hereto;  it being
understood  and  agreed  that no act of the  parties  hereto  shall be deemed to
created any relationship other than that of Sublandlord and Subtenant.

     12.  Insurance.   Subtenant  agrees  to  maintain  casualty  and  liability
insurance coverage with respect to the Premises and with limits of liability and
deductibles  as  required   under  the  Prime  Lease.   Prior  to  the  Sublease
Commencement  Date,  Subtenant shall provide  Sublandlord  with a certificate of
insurance evidencing such insurance coverage.

     13.  Incorporation.  Except as may be  inconsistent  with the terms of this
Sublease Agreement, which is subject and subordinate to the Prime Lease, all the
terms,  covenants and  conditions of the Prime Lease,  excepting the  provisions
contained therein with respect to (a) the Security  Deposit,  (b) any options to
renew the Term,  or (c) any  options to cancel the Prime  Lease


(excluding  the option to terminate  pursuant to Section 13 of the Prime Lease),
shall be applicable to this Sublease Agreement with the same force and effect as
if  Sublandlord  were the lessor  under the Prime Lease and  Subtenant  were the
lessee  thereunder;  and in case of any breach by Subtenant,  Sublandlord  shall
have all the  rights  against  Subtenant  as would be  available  to the  lessor
against the lessee under the Prime Lease,  Sublandlord  shall in addition,  upon
the occurrence of any breach by Subtenant and the failure to cure the same on or
before the expiration of three (3) days notice  thereof,  be entitled to recover
from  Subtenant  the cost of the removal of Subtenant and  Subtenant's  property
from the Premises.

     14. Binding Agreement.  The covenants and agreements herein contained shall
bind and insure to the benefit of Sublandlord,  Subtenant,  and their respective
executors, administrators, successors and assigns; however, this provision shall
not be deemed to authorize any violation of Section 9 hereof.

     15. Complete Agreement. All prior understandings and agreements between the
parties  are merged  within  this  Sublease  Agreement,  which  alone  fully and
completely sets forth the  understanding  of the parties,  and this Sublease may
not be changed or terminated  orally or in any manner other than by an agreement
in writing and signed by the party  against  whom  enforcement  of the change or
termination is sought.

     Sublandlord  represents  and  warrants  to  Subtenant  that the Prime Lease
attached hereto as Exhibit A and the First Sublease attached hereto as Exhibit B
are true,  correct and  complete  copies  thereof.  Sublandlord  represents  and
warrants to Subtenant that, to Sublandlord's  knowledge, (i) there is no default
by either Prime Landlord or First Sublandlord under the Prime Lease or by either
First  Sublandlord  or  Sublandlord  under the First Sublease and (ii) the Prime
Lease and the First Sublease are in full force and effect.

     16. Security Deposit. Upon the execution hereof, Subtenant shall deliver to
Sublandlord  a security  deposit in the amount of Seven  Thousand  Eight Hundred
Thirty-Three and 81/100 Dollars ($7,833.81) (the "Security Deposit") as security
for  the  payment  and  performance  by  Subtenant  of all  of its  obligations,
covenants,  conditions and agreements hereunder.  The Security Deposit shall not
be considered a prepayment of rent or a limit on Subtenant's liability under the
Sublease or as liquidated  damages. If there is an event of default by Subtenant
hereunder,  Sublandlord  shall have the right,  but shall not be  obligated,  to
apply the Security Deposit as is reasonably  necessary to cure such default,  in
which event Subtenant shall be obligated to promptly  deliver to Sublandlord the
cash amount  necessary to restore the Security  Deposit to its original  amount,
the  Subtenant's  failure to do so within  ten (10) days after  notice of demand
therefor  from  Sublandlord  shall  constitute  an event of  default  under  the
Sublease  entitling  Sublandlord  without  further notice to all of its remedies
under the Sublease;  provided,  however, such defaults and Subtenant's liability
under the Sublease  shall  thereby be  discharged  only pro tanto and  Subtenant
shall  remain  liable  for any  amounts  that  said  Security  Deposit  shall be
insufficient  to pay.  Sublandlord  agrees to return  the  Security  Deposit  to
Subtenant within fifteen (15) days of the Sublease Expiration Date. In addition,
Sublandlord  agrees to pay  Subtenant  all  accrued  interest  collected  on the
Security Deposit, net of taxes.


     17. Brokers.  Upon execution of this Sublease by both parties,  Sublandlord
shall pay to Grubb and Ellis a commission  as set forth in a separate  agreement
between  Sublandlord  and said  brokers,  for  brokerage  services  rendered  to
Sublandlord in this transaction.  Except as aforesaid, the parties represent and
warrant to each  other  that they have  dealt with no other  broker or finder in
connection with this transaction.

     18. Prime Landlord's and First Sublandlord's  Consent. It is understood and
agreed by the parties hereto that acceptance of this Sublease by the Sublandlord
shall be subject to the consent of the Prime Landlord  pursuant to Section 20 of
the Prime Lease and of the First  Sublandlord  pursuant  to the First  Sublease.
Sublandlord shall not be liable in any manner to Subtenant should Prime Landlord
or First  Sublandlord  reject the  Sublandlord's  request  for  approval of this
Sublease.  Subtenant shall use reasonable  efforts to cooperate with Sublandlord
to provide the  information  required  by Prime  Landlord  with  respect to this
Sublease.   Sublandlord   hereby   acknowledges  to  First   Sublandlord   that,
notwithstanding  this  Sublease,  Sublandlord  shall  in no way be  released  or
relieved,  in whole or part, from  Sublandlord's  covenants as "Subtenant" under
the First Sublease.  In the event Prime Landlord or First Sublandlord refuses to
consent  to this  Sublease,  then upon ten (10) days  following  written  notice
thereof from Sublandlord,  Subtenant shall vacate the Premises.  Notwithstanding
the foregoing, in the event that Subtenant fails to vacate the Premises,  within
such ten (10) day period (i) Prime Landlord or Sublandlord may forthwith reenter
and take  possession of said Premises,  and (ii) Subtenant shall pay Sublandlord
an amount  equal to twice the monthly  payment of Basic  Monthly  Rent in effect
immediately  prior to the expiration of the Term,  however,  the foregoing shall
not be deemed to limit  Subtenant's  liability arising from any wrongful holding
over. This Sublease may be executed in two or more  counterparts,  each of which
when incorporated together shall constitute an original.


     IN WITNESS  WHEREOF,  the parties  hereto  have caused this  Sublease to be
executed as of the day and year first above written:

WITNESS:                                  SUBLANDLORD:                 

                                          VistaRMS, Inc.

By:                                       By:                            [Seal]
   ----------------------------              ----------------------------
                                             Its: President

WITNESS:                                  SUBTENANT::

                                          Tel-Save, Inc.

By:                                       By:                            [Seal]
   ----------------------------              ----------------------------


                            CONSENT OF PRIME LANDLORD

     Reston Plaza Office L.L.C.  (the "Prime  Landlord"),  owner of the Premises
hereinabove  subleased and Prime Landlord  under the Prime Lease,  in accordance
with the  provision  of Section 20 of the Prime Lease,  hereby  consents to this
Sublease  Agreement  upon the terms stated  herein,  and such  approval is being
issued  on  the  condition  that  neither  Gemini  Air  Cargo,  L.L.C.  nor  RMS
International,  Inc.  (dba  Vistarms,  Inc.)  shall  be  relieved  from  primary
liability  for all  obligations  of the Tenant  under the Prime Lease and on the
condition  that this  approval  does not amend or modify the actual terms of the
Prime Lease in any manner.

     In accordance with Section 20 of the Prime Lease,  Tel-Save,  Inc. shall be
directly  liable to Prime  Landlord  for all  obligations  of Gemini  Air Cargo,
L.L.C.  under the Prime Lease and  Tel-Save,  Inc.  by  executing  the  Sublease
Agreement, hereby assumes all such obligations. Tel-Save, Inc. acknowledges that
such obligations include, without limitation, the obligation under Section 20 of
the Prime Lease to pay directly to Prime Landlord,  as "Additional  Rent," fifty
percent  (50%) of the excess of (i) the "Basic Rent"  payable under the Sublease
Agreement over (ii) the "Basic Rent" payable under the Prime Lease.

                                  PRIME LANDLORD:

                                  RESTON PLAZA OFFICE, L.L.C.

WITNESS:                          By:       LASALLE ADVISORS
                                            PARTNERSHIP, Advisor and
                                            Duly Authorized Agent

------------------------------       ---------------------------------

                                  Name:      David L. Reahl

                                  Title:     Vice President


                           CONSENT OF GEMINI AIR CARGO

     Gemini Air Cargo,  Inc.,  First  Sublandlord  of the  Premises  hereinabove
subleased in accordance  with the terms of the First Sublease hereby consents to
this Sublease Agreement upon the terms stated herein, and such approval is being
issued on the condition that RMS  International,  Inc., now doing business under
VistaRMS,  Inc., will not be relieved from primary liability for all obligations
of the Subtenant  under the First  Sublease  Agreement and on the condition that
this approval does not amend or modify the actual terms of the First Sublease in
any manner.

     The undersigned  agrees that it will not be relieved from primary liability
for all obligations of the Tenant under the Prime Lease.

                                       FIRST SUBLANDLORD:

                                       GEMINI AIR CARGO, INC.


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