EXHIBIT 10.14
LEASE
SECTION 1
SECTION 1.1. REFERENCE INFORMATION. Reference in this Lease to any of the
following shall have the meaning set forth below:
Date of this lease: 1 October 1995
Premises: Approximately 31,917 square feet of floor space identified as the
Premises Part A and Part B on the plan attached hereto as Exhibit B of Building
Number 7 (the "Building") on the lot (the "Site") situated at 150 Sohier Road,
Beverly, Massachusetts, together with the unassigned parking spaces (located in
the parking area adjoining the Building) as shown on the plan attached hereto as
Exhibit A.
Landlord: Communications & Power Industries, Inc., a Delaware corporation
Address of Landlord: 150 Sohier Road, Beverly, Massachusetts 01915
Tenant: Converter Power Inc., a Massachusetts corporation
Address of Tenant: 148 Sohier Road, Beverly, Massachusetts 01915
Commencement Date: Part A, 1 October 1995; Part B, January 1, 1996
Expiration Date: 30 September 2000
Premises Square Footage:
Part A - 5,760 square feet; and
Part B - 26,157 square feet for a total of approximately 31,917 square
feet.
Building Square Footage: Approximately 39,576 square feet.
Annual Fixed Rent Rate During Initial Term:
Part A (5,760 square feet): _________ 1, 1995 to December 31, 1995: $3,120/mo.
Part A and B (31,917 square feet):
January 1, 1996 to
August 31, 1998: $17,288.38/mo.
September 1, 1998 to
August 31, 2000: $18,136.13/mo.
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Permitted Uses: Office, light manufacturing and storage
Security Deposit: None
Broker: Hunneman Commercial Company, Boston, MA; Mr. Greg Klemmer.
SECTION 1.2. EXHIBITS. The following Exhibits are attached to and
incorporated in this Lease:
Exhibit A: Site Plan
Exhibit B: Plan of Premises (Part A & B)
Exhibit C: List of Hazardous Substances Used By Tenant
Exhibit D: List of Environmental Reports
SECTION 2
PREMISES AND TERM
SECTION 2.1. PREMISES. Landlord hereby leases and demises the Premises to
Tenant and Tenant hereby leases the Premises from Landlord, subject to any and
all existing encumbrances and subject to the terms and provisions of this Lease.
Landlord is the owner in fee simple of the Premises, the Building, and the Site.
Tenant shall have the right of full and unrestricted ingress to and egress from
the Premises.
Notwithstanding the foregoing, it is understood and agreed that (a) certain
property of Landlord may remain on the Premises after the Commencement Date, but
shall be removed by Landlord, at it's sole cost and expense on or before January
1, 1996 and (b) as of the date hereof, there is no interior wall separating the
Premises from the remaining portion of the Building not included in the
Premises. It is also understood that another tenant, Multilevel Metals, Inc., or
any successor occupant thereto, with reasonable notification to Converter Power,
Inc., shall have the right of full and unrestricted ingress to and egress from
the loading dock through the Leased Premises of Converter Power, Inc. to access
Multilevel Metal, Inc.'s (or such successor's) Leased Premises as approved and
directed by Converter Power, Inc.
SECTION 2.2. TERM. TO HAVE AND TO HOLD for an initial term (the "Initial
Term") beginning on the Commencement Date and ending on the Expiration Date,
unless sooner terminated as hereinafter provided. The initial Term shall be
subject to the extensions provided for in Section 2.3. The Initial Term and the
Extended Term (as hereinafter defined), if Tenant exercises its right to extend
this Lease in accordance with the terms of Section 2.3, shall be collectively
referred to herein as the "Term".
SECTION 2.3. EXTENSION. If no Event of Default (as hereinafter defined)
shall have occurred and be continuing (either on the date that Tenant exercises
its right to extend the Term of this Lease or on the date that the Extended Term
is to commence), Tenant is hereby granted the right to extend the Term of this
Lease beyond the Initial Term for one additional 5-year period (the "Extended
Term"), exercisable upon not less than twelve (12) months prior written notice
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to Landlord. During the Extended Term, all of the terms and conditions of this
Lease shall continue in force and effect. The annual fixed rent rate during the
extension term shall be the fair rental value of the premises on September 1,
2000 but not less than the rent paid during the extension term shall be the fair
rental value of the premises on September 1, 2000 but not less than the rent
paid during the last year of the original term. The parties shall first attempt
to agree on fair rental value. In the event that the parties shall fail to agree
on fair rental value by January 1, 2000 respectively, the matter shall be
submitted to arbitration under the rule of the American Arbitration Association.
Each party shall chose as an arbitrator a licensed real estate broker whose
principal business is the leasing of commercial real estate in the greater
Beverly Area, and the two arbitrators shall choose a third arbitrator with
similar qualifications. The decision of two arbitrators shall be binding on the
parties. The arbitrators shall attempt to reach a decision before the
commencement of the extended term. In the event that they have not reached a
decision by that time, the tenant shall pay the same rent as in the last year of
the previous term and pay any additional rent due within ten days of the
arbitrator's decision.
SECTION 3
CONDITION OF PREMISES
SECTION 3.1. Condition of Premises. Tenant agrees to accept the Premises in
its present "AS IS" condition. Landlord shall have no obligation to perform any
work or construction. If Tenant shall desire to perform any work or
construction, the same shall be done only in accordance with this Lease.
Landlord represents that the Premises has a Certificate of Occupancy to permit
its use for manufacturing, warehousing, and offices.
SECTION 4
FIXED RENT
SECTION 4.1. THE FIXED RENT. Tenant shall pay rent (the "Fixed Rent") to
Landlord at the Address of Landlord or at such other place or to such other
person or entity as Landlord may by notice to Tenant from time to time direct,
at the Annual Fixed Rent Rate set forth in Section 1, in equal installments
equal to 1/12th of the Annual Fixed Rent Rate in advance on the first day of
each calendar month included in the Term, and for any portion of a calendar
month at the beginning or end of the Term, at that rate payable in advance for
such portion.
SECTION 4.2. ADDITIONAL RENT. Tenant's Proportionate Share of
Additional Rent includes Utilities which is 14.6% for Premises Part A, and 66.1%
for Premises Part B (or a total of 80.7% for the entire Premises (As "Utilities"
are hereinafter defined in Section 7.1), shall be payable by Tenant within
thirty (30) days after a reasonably detailed statement of actual expenses is
presented to Tenant by Landlord. At Landlord's option, however, an amount may be
estimated by Landlord from time to time of Tenant's proportionate share of
Additional Rent and the same shall be payable monthly, during each 12-month
period of the lease term, in advance, on the first day of each calendar month
included in the Term, and for any portion of a calendar month at the beginning
or the end of the Term, at the rate payable in advance for such portion.
Landlord shall deliver to Tenant within sixty (60) days after the expiration of
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each calendar year a reasonably detailed statement showing Tenant's Share of
Actual Additional Rent incurred during the preceding year. If Tenant's payments
under this Section 4.2 during said preceding year exceed Tenant's Proportionate
Share as indicated on said statement, Tenant shall be credited the amount of
such over-payment against Tenant's Proportionate Share of Additional Rent next
becoming due. If Tenant's payment under this Section 4.2 during said preceding
year are less than Tenant's Proportionate Share as indicated on said statement,
Tenant shall pay to Landlord the amount of the deficiency within thirty (30)
days after the delivery by Landlord to Tenant of said statement. Tenant shall
have the opportunity upon written request to Landlord to review the books and
records of Landlord relating to the charges reflected in such statement and may,
within 60 days after the delivery of such statement, contest any such statement
if Tenant reasonably believes that it is inaccurate. No such review or contest
shall affect the obligations of Landlord and Tenant to make credits and payments
on the basis of such statements as aforesaid, but upon resolution of any
contest, a readjustment of any such credit or payment shall promptly be made.
SECTION 5
REAL ESTATE AND OTHER TAXES
SECTION 5.1. REAL ESTATE TAXES. Landlord, at its sole cost, shall pay all
real property taxes and general and special assessments levied or assessed
against the Site during the Term, excluding any increases in such taxes
resulting from (i) improvements to the Premises made by or for Tenant, or (ii)
any increase in such taxes assessed against the tax lot of which the Building is
a part above the taxes assessed for fiscal year 1995, plus 2-1/2%. Any increase
in taxes against the tax lot of which the Building is a part shall be allocated
proportionally to the Premises based upon square footage of occupied buildings
on such tax lot. Tenant shall reimburse Landlord upon demand as Additional Rent
the amount of such increases in taxes and assessments.
SECTION 5.2. PERSONAL PROPERTY TAXES. Tenant shall pay before delinquency
all taxes, assessments, licenses, fees and other charges (Taxes) that are levied
or assessed against Tenant's personal property installed or located in or on the
Premises which become payable during the Term. Upon Landlord's demand, Tenant
shall furnish Landlord with satisfactory evidence of these payments.
If any Taxes on Tenant's personal property are levied against Landlord or
Landlord's property, or if the assessed value of Landlord's property is
increased by the inclusion of a value placed on Tenant's personal property,
Tenant, on demand, shall immediately reimburse Landlord the sum of the Taxes
levied against Landlord on account of Tenant's personal property, or the
proportion of the Taxes resulting from the inclusion of Tenant's personal
property in Landlord's assessment. Landlord shall have the right to pay such
Taxes without incurring any liability to Tenant and without necessity of
contesting their validity, but will assign all rights Landlord may have to
contest these Taxes to Tenant upon Tenant's written demand therefor.
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SECTION 6
INSURANCE
SECTION 6.1.TENANT'S INSURANCE. Tenant shall at all times during the Term
of the Lease maintain, at its sole cost, a standard policy of fire and extended
coverage insurance in an amount customary in reasonable business practice
covering Tenant's trade fixtures, furnishings, equipment and all other items of
personal property of Tenant as well as any minor improvements or Improvements
constructed for or by Tenant and all property for which Tenant is responsible.
Tenant shall also maintain during the Term of this Lease, comprehensive
general public liability insurance covering its use, occupancy and maintenance
of the Premises and all areas appurtenant thereto. Such coverage, at the
commencement of the Term, shall have a minimum single limit of liability of at
least Two Million Dollars ($2,000,000) per person and Two Million Dollars
($2,000,000) per occurrence and, from time to time during the Term, shall be for
such higher limits as are reasonably required by Landlord. Such insurance shall
be written to apply to all bodily injury, property damage and other covered loss
during the Term of the Lease. Further, Tenant shall maintain Worker's
Compensation insurance and all other legally required insurance coverage in at
least the minimum amount mandated by statute. All of Tenant's insurance policies
shall provide primary coverage for the matters covered thereby and Landlord's
insurance shall have no obligation to contribute. Tenant's policies for
comprehensive general liability shall name Landlord as an additional insured
party.
SECTION 6.2. LANDLORD'S INSURANCE. Landlord, at its sole cost, shall obtain
and keep in force during the Term of this Lease a standard policy of fire and
extended coverage insurance on the Site on which the Premises are located and in
an amount customary with Landlord's business practice. Landlord shall also
maintain a standard policy of public liability insurance insuring against
liability arising out of Landlord's ownership of the Premises, the Site and all
areas appurtenant thereto in an amount of not less than Two Million Dollars
($2,000,000) per occurrence.
SECTION 6.3. WAIVER OF SUBROGATION. Landlord shall cause each insurance
policy carried by Landlord insuring the Premises against loss by fire and causes
covered by standard extended coverage, and Tenant shall cause each insurance
policy carried by Tenant and insuring the Premises and its fixtures and contents
against loss by fire and causes covered by standard extended coverage, to be
written in a manner so as to provide that the insurance company waives all right
of recovery by way of subrogation against Landlord or Tenant in connection with
any loss or damage covered by any such policies. Neither party shall be liable
to the other for any loss or damage caused by fire or any of the risks
enumerated in standard extended coverage insurance. Tenant and Landlord shall,
upon obtaining the policies of insurance required hereunder, give notice to the
insurance carrier or carriers that the foregoing mutual Waiver of Subrogation is
contained in this Lease. This waiver of right of recovery applies also to loss
or damage within Landlord's or Tenant's respective deductible or self-insured
retentions.
SECTION 6.4. INSURANCE POLICIES. Insurance required of Tenant hereunder
shall be provided by companies licensed to do business in the state of
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Massachusetts, satisfactory to Landlord and having A.M. Best's rating of not
less than A. Prior to the commencement of this Lease, Tenant shall deliver to
Landlord copies of policies of insurance required under this Lease or
certificates evidencing the existence and amounts of such insurance. No such
policy shall be cancelable or subject to reduction of coverage or other
modification except after thirty (30) days prior written notice to Landlord.
Tenant shall, at least thirty (30) days prior to the expiration or cancellation
of any or all such policies, furnish Landlord with renewals or binders thereof
or replacement policies; if Tenant fails to do so, Landlord may obtain such
insurance and charge the cost thereof and interest thereon to Tenant, which
amount shall be payable by Tenant upon demand. Tenant shall not do or permit to
be done anything on or about the Premises which shall invalidate any of the
insurance policies required to be carried hereunder or make any such insurance
unobtainable.
SECTION 7
UTILITIES; MAINTENANCE EXPENSES; FIRE ALARMS AND
SPRINKLER SYSTEMS
SECTION 7.1. UTILITIES. Landlord shall provide electrical, water and gas
services and reasonable amounts of compressed air to the Premises (the
"Utilities"), the cost of which shall be paid for by Tenant pursuant to Section
4.2. Landlord shall not be liable for any interruption or failure in the supply
of any such utilities to the Premises.
SECTION 7.2. MAINTENANCE EXPENSES. To the extent repairs or maintenance
covered by Section 9 are required due to Tenant's negligence or willful
misconduct, Landlord shall effect such repairs or maintenance at Tenant's sole
expense.
SECTION 7.3. FIRE ALARMS AND SPRINKLER SYSTEMS. Landlord shall maintain the
fire alarms and sprinkler systems for the Premises and fire extinguishers that
presently are located in Premises.
SECTION 8
HAZARDOUS SUBSTANCES
SECTION 8.1. USE OF HAZARDOUS SUBSTANCES. The term "Hazardous Substance" as
used in this Lease shall mean any product, substance, chemical, material or
waste whose presence, nature, quantity and/or intensity of existence, use,
manufacture, disposal, transportation, spill, release or effect, either by
itself or in combination with other materials expected to be on the Premises,
is: (i) potentially injurious to the public health, safety or welfare, the
environment or the Premises, (ii) regulated or monitored by any governmental
authority and/or (iii) a basis for liability to any governmental agency or third
party under any applicable statute or common law theory. Hazardous Substance
shall include, but not be limited to, hydrocarbons, petroleum, gasoline, crude
oil or any products, by-products or fractions thereof. Tenant shall not engage
in any activity in, on or about the Premises (or permit any of its agents or
employees to engage in any activity in, on or about the Premise) which
constitutes the generation, possession, manufacture, storage, use,
transportation, handling, treatment, release, deposit and/or disposal of a
Hazardous Substance except in strict compliance with Applicable Law (as
hereinafter defined), and provided, such generation, possession, manufacture,
storage, use, transportation, handling, treatment, release, deposit and/or
disposal of Hazardous Substance does not expose the Premises, the Building, the
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Site and/or neighboring properties to any risk of contamination or damage, or
expose Landlord or any Lender (as hereinafter defined) to any liability
therefor. Notwithstanding anything to the contrary contained herein, in no event
shall Tenant, its agents, employees, contractors, social guests, or business
invitees (a) generate, possess, manufacture, store, use, transport, handle,
treat, release, deposit and/or dispose of any Hazardous Substance other than the
Hazardous Substances identified on Exhibit C attached hereto, which may not
exceed the specific volume or quantities identified therein, without the prior
written consent of Landlord, which consent may by withheld in Landlord's sole
and absolute discretion and/or (b) introduce, in any manner, any Hazardous
Substances in or through the plumbing and/or sewer systems servicing any portion
of the Site. Without limiting the foregoing, Tenant shall introduce only
domestic sewage into the plumbing and sewer systems in compliance with
Applicable Laws, including the rules and regulations of the South Essex Sewer
District. In addition, with respect to the presence, generation, possession,
manufacture, storage, use, transportation, handling, treatment, release, deposit
and/or disposal of any Hazardous Substance in, on, under or about the Premises
as may be allowed hereunder, Tenant shall give Landlord such additional
assurances as Landlord, in its subjective, good faith discretion, deems
necessary to protect itself, the public, the Premises, the Building, the Site
and the environment against damage, contamination or injury and/or liability
therefrom or therefor, including, but not limited to, the installation (and
removal on or before the expiration or earlier termination of this Lease) of
reasonably necessary protective modifications to the Premises (such as concrete
encasements or other containments), provided that no such protective
modifications applicable to the use of the items listed on Exhibit C may be
required in excess of measures necessary to comply with Applicable Law. Tenant
shall be solely responsible for providing any notice of the presence,
generation, possession, manufacture, storage, use, transportation, handling,
treatment, release, deposit and/or disposal of any Hazardous Substance to
persons occupying or entering the Premises, the Building and/or the Site and to
neighboring properties. Upon the expiration or earlier termination of this
Lease, Tenant shall, at its sole cost and expense, upon Landlord's request and
in compliance with all Applicable Laws: (i) remove, remediate, abate, and/or
dispose of any Hazardous Substance stored or otherwise located in, on, under or
about the Premises, the Building and/or the Site (including, without limitation,
general decontamination of workspaces and duct-work) by Tenant, its agents,
employees, contractors, social guests, or business invitees; (ii) remove,
remediate, abate, dispose of and/or replace any soil (and compact the same as
then required by law or by Landlord) contaminated by Tenant, its agents,
employees, contractors, social guests, or business invitees; and (iii)
remediate, remove, abate and/or dispose of any surface water, or ground water
contaminated by Tenant, its agents, employees, contractors, social guests, or
business invitees; such that the Premises, the Building and the Site are free
from any Hazardous Substances which were generated, possessed, manufactured,
stored, used, transported, handled, treated, released, deposited and/or disposed
of by Tenant, its agents, employees, contractors, social guests, or business
invitees.
SECTION 8.2. DUTY TO INFORM LANDLORD. If Tenant knows, or has reasonable
cause to believe, that a Hazardous Substance, or a condition involving or
resulting from same, has come to be located in, on, under or about the Premises,
other than as previously consented to by Landlord, Tenant shall immediately give
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oral notice of such fact to Landlord, followed as soon as possible by written
notice to Landlord. Such oral and written notice shall be made for any release
or discharge of any quantity of Hazardous Material at the site that (i) is
likely to come in contact with soil or groundwater or (ii) is more than one
pound by weight or (iii) cannot be cleaned up within 15 minutes. Such notice
shall include a complete description of the type and quantity of Hazardous
Material released or discharged, the location of the release or discharge and
the regulatory agencies notified. Tenant shall also immediately give Landlord a
copy of any statement, report, notice, registration, application, permit,
business plan, license, claim, action or proceeding given to, or received from,
any governmental authority or private party, or persons entering or occupying
the Premises, concerning the presence, spill, release, discharge of, or exposure
to, any Hazardous Substance or contamination in, on, or about the Premises.
Tenant acknowledges that it, and not Landlord, is in charge of the Premises for
purposes of all reporting requirements under any Applicable Law.
SECTION 8.3. INDEMNIFICATION. Tenant shall indemnify, protect, defend and
hold Landlord its agents, employees, partners, co-managing directors, lenders,
the Premises, the Building and the Site harmless from and against any and all
loss of rents and/or damages, liabilities, judgments, costs, claims, liens,
expenses, penalties, permits and attorneys' and consultants' fees arising out of
or involving the presence, generation, possession, manufacture, storage, use,
transportation, handling, treatment, release, deposit and/or disposal of any
Hazardous Substance in, on, under or from the Premises on or after the
Commencement Date and continuing during the Term and any extension thereof due
to the activities of Tenant, its agents, employees, contractors, social guests
or business invitees on or about the Site. Tenant's obligations under this
Section 8 shall include, but not be limited to, the effects of any contamination
or injury to person, property or the environment created or suffered by Tenant,
its agents, employees, contractors, social guests, or business invitees, and the
cost of investigation (including, without limitation, consultants' and
attorneys' reasonable fees and testing), removal, remediation, restoration
and/or abatement thereof, or of any contamination therein involved and any costs
and fees related to the generation, possession, manufacture, storage, use,
transportation, handling, treatment, release, deposit and/or disposal of any
Hazardous Substances by Tenant, its agents, employees, contractors, social
guests, or business invitees, and shall survive the expiration or earlier
termination of this Lease. No termination, cancellation or release agreement
entered into by Landlord and Tenant shall release Tenant from its obligations
under this Lease with respect to Hazardous Substances, unless specifically so
agreed by Landlord in writing at the time of such agreement.
Landlord shall indemnify, protect, defend and hold Tenant, its agents, and
employees, harmless from and against any and all claims by third parties against
Tenant for loss of rents and/or damages, liabilities, judgments, costs, claims,
liens, expenses, penalties, permits and attorneys' and consultants' fees arising
out of or involving the presence, generation, possession, manufacture, storage,
use, transportation, handling, treatment, release, deposit and/or disposal of
any Hazardous Substance in, on, under or from the Site before the Commencement
Date or due to the activities of Landlord, its agents, employees, contractors,
social guests, or business invitees on or about the Site. Landlord's obligations
under this Section 8 shall include, but not be limited to, the effects of any
contamination or injury to person, property or the environment created or
suffered by Landlord or the prior tenants of the Site, and the cost of Tenant's
investigation (including consultant's and attorney's reasonable fees and
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testing), removal, remediation, restoration and/or abatement thereof, or of any
contamination therein involved and any costs and fees related to the generation,
possession, manufacture, storage, use, transportation, handling, treatment,
release, deposit and/or disposal of any Hazardous Substances by Landlord, its
agents, employees, contractors, social guests, or business invitees, and shall
survive the expiration or earlier termination of this Lease.
SECTION 8.4. HAZARDOUS SUBSTANCE HANDLING. Tenant shall, at its own
expense, procure, maintain in effect and comply with all conditions of any and
all permits, licenses and other governmental and regulatory approvals required
for Tenant's use of the Premises. Subject to Tenant's compliance with the
provisions of this Section 8, Tenant shall cause any and all Hazardous Substance
used, stored, released, generated, manufactured or produced on the Premises to
be removed, transported and disposed of solely by duly licensed haulers to duly
licensed facilities for final disposal of such Hazardous Substance. In no event
shall Tenant dispose of any Hazardous Substance on, in, under or about the
Premises. Upon the expiration or earlier termination of this Lease, Tenant shall
cause all Hazardous Substance to be removed from the Premises and transported
for use, storage or disposal in accordance and compliance with all Applicable
Law. Tenant shall not take any remedial action in response to the presence of
any Hazardous Substance in or about the Premises, nor enter into any settlement
agreement, consent decree or other agreement in respect to any complaint or
claim relating to any Hazardous Substance in any way connected with the
Premises, without first notifying Landlord of Tenant's intention to do so and
affording Landlord ample opportunity to appear, intervene and otherwise
appropriately assert and protect Landlord's and Landlord's predecessor's, Varian
Associates, Inc. ("Varian") interests in the contemplated action; however,
notwithstanding anything to the contrary contained herein, Tenant shall
immediately take any action as necessary to respond to any spills or releases of
Hazardous Substances and shall immediately inform Landlord of the details of all
such events and such actions taken.
SECTION 8.5. WAIVER AND RELEASE. Tenant acknowledges that Landlord has made
available to Tenant the environment reports regarding the Site listed on Exhibit
D attached hereto and that no environmental testing has been performed on the
Premises or the Building, so that Landlord and Tenant have no knowledge whether
any Hazardous Substances are present in, on, under or about the Premises or in,
under or about the Building (except to the extent that any Hazardous Substances
are utilized by Landlord in connection with the operation of its business in the
Building or the presence of any Hazardous Substances is disclosed in the
environmental reports listed on Exhibit D). Subject to the provisions of section
8.3, Tenant hereby waives, releases and discharges Landlord and Varian, and each
of Landlord's and Varian's officers, directors, shareholders, partners,
employees, agents, representatives, attorneys, successors and assigns from any
and all environmental suits, causes of action, legal or administrative
proceedings, liabilities, claims, damages, losses, costs and expenses of
whatever kind, or unknown, including any action under the Comprehensive
Environmental Reponse, Compensation and Liability Act (42 U.S.C. Section 9601 et
seq.), as amended ("CERCLA") and the provisions of the Massachusetts Hazardous
Waste Management Act, M.G.L. c. 21 C and the Massachusetts Oil and Hazardous
Material Release Prevention and Response Act, M.G.L. c. 21E, as amended, which
Tenant has or may have, based upon the presence, discharge, treatment,
recycling, use, migration, storage, generation, release, or transportation to or
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from the Premises of any Hazardous Substance or the environmental condition of
the Premises (including without limitation all facilities, improvements,
structures and equipment thereon and soil and groundwater thereunder) on and
after the Commencement Date.
SECTION 8.6. ENVIRONMENTAL REMEDIATION. Tenant acknowledges that Landlord
has informed Tenant that Landlord and Varian are in the process of conducting
investigations of the Hazardous Substances located on the Site (collectively,
the "Investigations") and that Landlord and Varian shall complete such
remediation of the Site as Landlord and Varian deem appropriate based upon the
results of such investigations (the "Remediation"). Notwithstanding anything to
the contrary contained herein, Landlord and Varian reserve the right to conduct
and complete the Investigations and Remediation on the Site, including, without
limitation, in, under and about the Premises, and, to that end, Landlord and its
agents, consultants and employees including Varian employees, agents and
consultants shall have the right to enter upon the Premises to undertake the
Investigations and Remediation, and Tenant's use and access to the Premises, the
Building, the parking areas and the Site may be limited by the activities
conducted by Landlord and Varian and Landlord's and Varian's agents, consultants
and employees in connection with the Investigations and Remediation; provided,
however that Landlord and Varian shall use reasonable efforts to minimize any
limitation of and/or disruption to Tenant's use and access to the Premises, the
Building, the parking areas and the Site as a result of the Investigations and
Remediation on the Site. Without limiting the foregoing, Landlord reserves the
right to re-assign parking spaces to Tenant; provided, however, that in no event
shall less than one hundred thirty (130) parking spaces be assigned to Tenant at
any time during the Term.
SECTION 8.7. COOPERATION WITH VARIAN. Tenant shall cooperate with Varian
and Landlord in the conduct of Investigations and Remediation, shall not
unreasonably interfere with Varian's activities and shall cooperate with
Varian's efforts to accomplish the Investigations and Remediations in a cost
effective and reasonable manner. Tenant shall provide Landlord with reasonable
written notice of any construction at or alterations to the site which may
adversely affect such Investigations and Remediation. Provided Tenant complies
with this Section 8.7, if the exercise of rights under Section 8.6 deprives
Tenant of the use of a material portion of the Premises for more than 5 days
after notice to Landlord, Tenant shall be entitled to an equitable abatement of
rent until such use is restored.
SECTION 8.8. COOPERATION WITH AGENCIES. Tenant shall cooperate with
governmental agencies to the extent reasonably necessary for Varian to perform
the Investigations and Remediation.
SECTION 8.9. PERFORMANCE OF TESTING. Tenant shall provide reasonable
advance written notice to Landlord, which notice shall not be less than fifteen
(15) working days (unless a shorter period is necessitated by legal or
regulatory requirements, in which case notice shall be provided as much in
advance as is reasonably practical), before performing or causing to be
performed any Hazardous Material testing of the soils, groundwater or surface
waters at or near the site, including installation of soil borings or monitoring
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wells or testing of soils, groundwater or surface waters. Tenant shall promptly
furnish Landlord with a copy of all test results.
SECTION 8.10. OSHA ASBESTOS NOTIFICATION. Pursuant to 29 CFR ss. 1910.1001,
Landlord hereby notifies Tenant that Landlord has good cause to believe that
asbestos containing materials or materials presumed to contain asbestos, as
those terms are defined in the OSHA regulations identified above, are located in
the Premises. The materials containing or presumed to contain asbestos are
located in vinyl asbestos tiles and in roofing materials.
SECTION 9
LANDLORD'S COVENANTS
SECTION 9.1. BUILDING MAINTENANCE. Subject to 7.2, Sections 8, 10 and 11,
Landlord shall maintain and repair the exterior walls (exclusive of the interior
surfaces of the exterior walls, all of which Tenant shall maintain and repair),
doors, windows, roof, foundation, structural supports of the Building and, the
Building's and Premises' heating and ventilation. Landlord shall have no
obligation to make any such repairs until a reasonable time after Landlord's
receipt of written notice from Tenant specifying the need for such repairs.
Notwithstanding the foregoing, any emergency repairs shall be done as quickly as
practicable.
SECTION 9.2. COMMON AREA MAINTENANCE. Subject to Sections 7.2, 8, 10 and
11, Landlord shall maintain and repair the common areas of the Building, if any,
and the common areas on the Site, including all sidewalks, access driveways,
parking lot area, exterior light standards and fences. Landlord shall clean and
provide snowplowing and landscaping for the same. Landlord shall have no
obligation to make any such repairs until a reasonable time after Landlord's
receipt of written notice from Tenant specifying the fees for such repairs.
Tenant has the right to install vending machines with prior written consent of
Landlord which approval shall not be unreasonably withheld or delayed. Section
9.3. Cafeteria Service. Landlord shall make available food service at Landlord's
main Cafeteria on the Site which may be purchased by Tenant's employees and
visitors. Tenant may install vending machines in the Premises using Landlord's
vending machine supplier.
SECTION 10
TENANT'S COVENANTS
SECTION 10.1. USE. Tenant shall use the Premises only for the Permitted
Uses and shall from to time procure all licenses and permits necessary therefor
at Tenant's sole expense. In no event may Tenant's use of the Premises, the
parking area or any of the common areas of the Building or Site interfere with
the use of the Site by Landlord and/or other occupants of the Site.
SECTION 10.2. TRASH AND JANITORIAL SERVICE. Tenant shall keep in a safe,
secure and sanitary condition all trash and rubbish temporarily stored at the
Premises (which shall be stored at a location on the Site to be mutually agreed
upon by Tenant and Landlord) and shall arrange for and be responsible for all of
the costs of a trash and rubbish removal and janitorial service in connection
with Tenant's use of the Premises.
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SECTION 10.3. TENANT'S COMPLIANCE WITH LAW. Tenant, shall, at Tenant's sole
cost and expense, fully, diligently and in a timely manner, comply with all
"Applicable Law," which term is used in this Lease to include all laws, rules,
regulations, ordinances, orders, directives, covenants, easements and
restrictions of record, permits, the requirements of any applicable fire
insurance underwriter or rating bureau, and the recommendations of Landlord's
engineers and/or consultants, relating in any manner to the Premises (including
but not limited to matters pertaining to (i) industrial hygiene, (ii)
environmental conditions on, in, under or about the Premises, including soil and
ground water conditions, and (iii) the presence, use, generation, manufacture,
production, installation, maintenance, removal, disposal, transportation,
storage, spill or release of any Hazardous Substance or storage tank), now in
effect or which may hereafter come into effect, and whether or not reflecting a
change in Applicable Law or policy from any previously existing Applicable Law
or policy Tenant shall, within five (5) days after receipt of Landlord's written
request, provide Landlord with copies of all documents and information,
including, but not limited to, permits, registrations, manifests, applications,
reports and certificates, evidencing Tenant's compliance with any Applicable Law
specified by Landlord, and shall immediately upon receipt, notify Landlord in
writing (with copies of any documents involved) of any threatened or actual
claim, notice, citation, warning, complaint or report pertaining to or involving
failure by Tenant or the Premises to comply with any Applicable Law.
SECTION 10.4. INSPECTION; COMPLIANCE. Landlord, Varian and/or any Lender
shall have the right to enter the Premises at any time, provided that prior
notice is given except in the case of an emergency, for the purpose of
inspecting the condition of the Premises and for verifying compliance by Tenant
with this Lease and all Applicable Law, and to employ experts and/or consultants
in connection therewith and/or to advise Landlord with respect to Tenant's
activities, including but not limited to the installation, operation, use,
monitoring, maintenance, or removal of any Hazardous Substance on, under or from
the Premises. The costs and expenses of any such inspections shall by paid by
the party requesting same, unless an Event of Default, violation of Applicable
Law, or a contamination, caused or materially contributed to by Tenant is found
to exist or be imminent in Landlord's subjective, good faith judgment, or unless
the inspection is requested or ordered by a governmental authority as the result
of any such existing or imminent violation or contamination. In any such case,
Tenant shall upon request reimburse Landlord and/or the applicable Lender, as
the case may be, for the costs and expenses of such inspections.
SECTION 10.5. BUILDING CONTAMINANTS. Without limiting the provisions of
Section 8, to prevent the generation, growth, or deposit of any mold, mildew,
bacillus, virus, pollen or other micro-organism (collectively, "Biologicals")
and the deposit, release or circulation of any indoor Contaminants, including
emissions from paint, carpet and drapery treatments, cleaning, maintenance and
construction materials and supplies, pesticides, pressed wood products,
insulation, and other materials and products (collectively with Biologicals,
"Contaminants"), that could adversely affect the health, safety or welfare of
any tenant, employee, or other occupant of the Building or their invitees (each,
an "Occupant"), Tenant shall, at Tenant's sole cost and expense, at all times
during the Term (i) operate the Premises in such a manner to prevent or minimize
the accumulation of stagnant water and moisture in planters, kitchen appliances
and vessels, carpeting, insulation, water coolers and any other locations where
stagnant water and moisture could accumulate and (ii) otherwise operate the
Premises to prevent the generation, growth, deposit, release or circulation of
any Contaminants. If any
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governmental entity or any Occupant alleges that health, safety or welfare has
or could be adversely affected by any such Contaminants, Tenant shall notify
Landlord in writing within twenty-four (24) hours of the time the allegation is
made. Landlord may then elect to engage the services of an industrial hygiene
testing laboratory (or alternatively or concurrently require Tenant to do the
same) to determine whether the cause of any alleged adverse health effect is or
could be attributable to any Contaminants present within the Premises. Tenant
shall be responsible for all such testing costs and for any consequential
damages and costs (including, without limitation, any third-party claims, loss
of rental, remediation, removal and/or abatement costs, and increase in
insurance premiums) resulting from Tenant's failure to comply in whole or in
part with the terms of this Section 10.5.
SECTION 10.6. TENANT'S WORK. Tenant shall not make any installations,
alterations, additions or improvements (collectively, the "Improvements") in or
to the Premises costing in the aggregate more than Ten Thousand Dollars
($10,000) and/or requiring a building permit, including, without limitation, any
apertures in the walls, partitions, ceilings or floors, without on each occasion
obtaining the prior written consent of Landlord, which consent shall not be
unreasonably withheld. Any such work so approved by Landlord shall be performed
only in accordance with plans and specifications therefor approved by Landlord.
Plans and specifications pertaining to any proposed Improvements must be
submitted to Landlord for approval, along with the name of the contractor to
perform such work, at least thirty (30) days prior to the commencement of
construction of the Improvements. Tenant shall procure at Tenant's sole expense
all necessary permits and licenses before undertaking any work on the Premises
and shall perform all such work in a good and workmanlike manner employing
materials of good quality and so as to conform with all applicable zoning,
building, fire, health and other codes, regulations, ordinances and laws and
with all applicable insurance requirements. If reasonably requested by Landlord,
Tenant shall furnish to Landlord prior to the commencement of any such work a
bond or other security acceptable to Landlord assuring that any work to be
performed by, or on behalf of, Tenant, will be completed in accordance with the
approved plans and specifications. Tenant shall keep the Premises at all times
free of liens for labor and materials. If any such lien is filed, Landlord may,
but shall not be required to, take such action as Landlord in its sole
discretion deems necessary to remove all such liens, Tenant shall pay to
Landlord upon demand the amounts expended by Landlord in causing such removal,
together with interest thereon at the Delinquency Rate (as hereinafter defined)
from and including the date of Landlord's expenditure until the date Landlord is
reimbursed by Tenant.
In connection with the construction of all Improvements, Tenant shall
engage a contractor (licensed to conduct business in the Commonwealth of
Massachusetts) who shall obtain and maintain general liability insurance and
property damage insurance and workers' compensation insurance in amounts not
less than required of Tenant under Section 6 and such policies (excluding the
workers' compensation insurance) shall name Landlord as an additional insured
and will be issued by insurance companies licensed to do business in the
Commonwealth of Massachusetts, satisfactory to Landlord and having an A.M.
Best's rating of not less than A. Certificates of insurance relative to such
policies shall be delivered to Landlord prior to the commencement of
construction of any Improvements.
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Tenant shall save Landlord harmless and indemnified from all injuries,
losses, costs (including, without limitation), claims and damages to any person
or property occasioned by or growing out of such work. Landlord may inspect the
work of Tenant at reasonable times and give notice of observed defects.
SECTION 10.7. INDEMNITY. Tenant shall defend, with counsel approved by
Landlord, all actions against Landlord, any partner, trustee, stockholder,
officer, director, employee or beneficiary of Landlord, holders of mortgages now
or hereafter secured by the Building and/or the Site (collectively, "Lenders")
and any other party having an interest in the Premises, the Building and/or the
Site (collectively, "Indemnified Parties") with respect to, and shall pay,
protect, indemnify and save harmless, to the extent permitted by law, all
Indemnified Parties from and against, any and all liabilities, losses, damages,
costs, expenses (including reasonable attorneys' fees and expenses), causes of
action, suits, claims, demands or judgments of any nature arising from (a)
injury to or death of any person, or damage to or loss of property, occurring in
the Premises or connected with the use, condition or occupancy of any thereof
unless caused by the negligence of Landlord or its servants or agents, or by
another Tenant, or its servants or agents, (b) violation of this Lease by
Tenant, or (c) any act, fault, omission, or other misconduct of Tenant or its
agents, contractors, licensees, sublicenssees or invitees.
SECTION 10.8. LANDLORD'S RIGHT TO ENTER. Without limiting any provision of
Section 10.4, Tenant shall permit Landlord and its agents to enter into the
Premises at reasonable times and upon reasonable notice to examine the Premises,
make such repairs and replacements as Landlord may be required to make under the
terms of this Lease or may elect, without however, any obligation to do so, and
show the Premises to prospective purchasers and Lenders, and, during the last
year of the Term, to show the Premises to prospective tenants and to keep
affixed in suitable places notices of availability of the Premises.
SECTION 10.9. PERSONAL PROPERTY AT TENANT'S RISK. All furnishings,
fixtures, equipment, effects and property of every kind of Tenant and of all
persons claiming by, through or under Tenant which may be on the Premises, shall
be at the sole risk and hazard of Tenant and if the whole or any part thereof
shall be destroyed or damage by fire, water or otherwise, or by the leakage or
bursting of water pipes, steam pipes, or other pipes, by theft or from any other
cause, no part of said loss or damage shall be charged to or to be borne by
Landlord, except that Landlord shall in no event be indemnified or held harmless
or exonerated from any liability to Tenant for any injury, loss, damage or
liability not covered by Tenant's insurance to the extent prohibited by law.
Tenant shall insure Tenant's personal property.
SECTION 10.10. PAYMENT OF LANDLORD'S COST OF ENFORCEMENT. Tenant shall pay,
on demand, Landlord's expenses, including reasonable attorneys' fees and
expenses, incurred in enforcing any obligation of Tenant under this Lease
(including, without limitation, enforcing any indemnification agreement set
forth herein) or in curing any default of Tenant under this Lease as provided in
Section 12.4.
SECTION 10.11. YIELD UP. At the expiration of the Term or earlier
termination of this Lease, Tenant shall surrender all keys to the Premises,
remove all of its trade fixtures and personal property in the Premises, remove
such installations and improvements made by Tenant as Landlord
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may request and all Tenant's signs wherever located, repair all damage caused by
such removal and yield up the Premises (including all installations and
improvements made by Tenant except for trade fixtures and such installations or
improvements made by Tenant as Landlord shall request Tenant to remove)
broom-clean and in the same good order and repair in which Tenant is obliged to
keep and maintain the Premises under this Lease. Any property not so removed
shall be deemed abandoned and may be removed and disposed of by Landlord in such
manner as Landlord shall determine and Tenant shall pay Landlord the entire cost
and expense incurred by it in effecting such removal and disposition and in
making any incidental repairs and replacements to the Premises and for use and
occupancy during the period after the expiration of the Term and prior to
Tenant's performance of its obligations under this Section 10.11.
SECTION 10.12. ESTOPPEL CERTIFICATE. Upon not less than five (5) business
days' prior notice by Landlord, Tenant shall execute, acknowledge and deliver to
Landlord a statement in writing certifying that this Lease is unmodified and in
full force and effect and that, except as stated therein, Tenant has no
knowledge of any defenses, offsets or counterclaims against its obligations to
pay the Fixed Rent and Additional Rent and any other charges and to perform its
other covenants under this Lease (or, if there have been any modifications that
the Lease is in full force and effect as modified and stating the modifications
and, if there are any defenses, offsets or counterclaims, setting them forth in
reasonable detail), the dates to which the Fixed Rent and Additional Rent and
other charges have been paid and a statement that, to the best of Tenant's
knowledge, that Landlord is not in default hereunder (or if Tenant claims
Landlord is in default, the nature of such default, in reasonable detail). Any
such statement delivered pursuant to this Section 10.12 may be relied upon by
any prospective purchaser or mortgagee of the Building and/or the Site.
SECTION 10.13. LANDLORD'S EXPENSES RE CONSENTS. Tenant shall reimburse
Landlord promptly on demand for all out-of-pocket expenses reasonably incurred
by Landlord in connection with all requests by Tenant for consent or approval
hereunder. Out of pocket expenses shall not include any legal fees incurred by
Landlord.
SECTION 10.14. RULES AND REGULATIONS. Tenant shall comply with such
reasonable Rules and Regulations as may be adopted from time to time by Landlord
to provide for the beneficial operation of the Site and Building.
SECTION 10.15. HOLDING OVER. Tenant shall vacate the Premises immediately
upon the expiration or sooner termination of this Lease. If Tenant retains
possession of the Premises or any part thereof after the termination of the term
without Landlord's express consent, Tenant shall pay Landlord Fixed Rent for the
time Tenant thus remains in possession in an amount equal to the greater of (i)
the then current Annual Fixed Rent Rate specified in Section 1 multiplied by
1.25 or (ii) one hundred twenty-five percent (125%) of the then current market
rate for similar space in the same general geographic area as the Premises, and,
in addition thereto, shall pay Landlord for all damages, consequential as well
as direct, sustained by reason of Tenant's retention of possession. The
provisions of this Section 10.15 do not exclude Landlord's rights of re-entry or
any other right hereunder, including without limitation, the right to remove
Tenant through summary proceedings for holding over beyond the expiration of the
Term.
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SECTION 10.16. ASSIGNMENT AND SUBLETTING. Tenant shall not assign,
transfer, mortgage or pledge this Lease or grant a security interest in Tenant's
rights hereunder or sublease (which term shall be deemed to include the granting
of concessions and licenses and the like) all or any part of the Premises or
suffer or permit this Lease or the leasehold estate hereby created or any other
rights arising under this Lease to be assigned, transferred or encumbered, in
whole or in part, whether voluntarily, involuntarily or by operation of law, or
permit the occupancy of the Premises by anyone other than Tenant. Any attempted
assignment, transfer, mortgage, pledge, grant of security interest, sublease or
other encumbrance, except with prior written approval thereof from Landlord
which approval shall not be unreasonably withheld or delayed, shall be void. No
assignment, transfer, mortgage, grant of security interest, sublease or other
encumbrance, whether or not approved, and no indulgence granted by Landlord to
any assignee or sublessee, shall in any way impair the continuing primary
liability (which after an assignment shall be joint and several with the
assignee) of Tenant hereunder, and no approval in a particular instance shall be
deemed to be a waiver of the obligation to obtain Landlord's approval in any
other case.
Landlord shall not be deemed to have unreasonably withheld its consent to a
proposed assignment or subletting if (a) the financial strength, net worth and
creditworthiness of the proposed assignee or sublessee are not at least equal to
that of the existing Tenant both at the time of the proposed assignment or
subletting and at the date hereof; (b) the business reputation of the proposed
assignee or sublessee is not in accordance with generally accepted commercial
standards or is not at least equal to that of the existing Tenant, both at the
time of the proposed assignment and at the date hereof; (c) the gross revenues
reasonably anticipated to be received from the conduct of business on the
Premises by the proposed assignee or sublessee are not at least equal to that of
the existing Tenant both at the time of the proposed assignment or subletting
and as of the date hereof; (d) the use of the Premises by the proposed assignee
or subtenant will violate or create any potential violation of Applicable Law;
and (e) the use of the Premises will violate any other agreements affecting the
Premises, the Building, the Site or Landlord. In connection with any proposed
assignment or subletting, Tenant shall provide to landlord such financial and
other information relating to the proposed assignee or sublessee as Landlord may
reasonably request.
If for any assignment or sublease Tenant shall receive rent or other
consideration, either initially or over the term of the assignment or sublease,
in excess of the rent called for hereunder (or in the case of the sublease of
part, in excess of such rent allocable to the part) after appropriate
adjustments to assure that all other payments called for hereunder are taken
into account, Tenant shall pay to Landlord, as Additional Rent, ninety percent
(90%) of such excess of such payment of rent or other consideration received by
Tenant, promptly after its receipt.
For the purposes of this Section 10.16, the term "assign" shall be deemed
to include any one or more sales, pledges or other transfers of (i) any of
capital stock of any class of Tenant, (ii) ten percent (10%) or more of the
capital assets or income interest in Converter Power Inc. Notwithstanding
anything contained herein to the contrary, Landlord's consent to any assignment
or sublease shall be conditioned upon the consent thereto from any and all
Lenders.
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Notwithstanding the foregoing, Landlord's consent shall not be required (i)
for a sublease or assignment to any entity controlled by, controlling or under
common control with Tenant, or (ii) for an assignment to any entity which is a
successor to Tenant by virtue of the acquisition of all or substantially all of
the assets or voting shares of Tenant, provided that in all cases under clauses
(i) and (ii) above no assignment or subletting shall affect the continuing
primary liability of Tenant (which following assignment shall be joint and
several with the assignee), and provided further that Tenant's right of
assignment under clause (ii) above shall be conditioned upon Landlord's written
acknowledgment, which it shall not unreasonably withhold, that it has received
from Tenant, at least 15 days prior to any proposed assignment pursuant to
clause (ii), evidence satisfactory to Landlord that the net worth of the
successor is and will be immediately after such assignment equal to or greater
than the net worth of Tenant as of the date of such notice.
SECTION 10.17. OVERLOADING AND NUISANCE. Tenant shall not injure, overload,
deface or otherwise harm the Premises, commit any nuisance, permit the emission
of any objectionable noise, vibration or odor, make, allow or suffer any waste
or make any use of the Premises which is improper, offensive or contrary to any
law or ordinance or which will invalidate any of Landlord's insurance.
SECTION 10.18. SIGNS. Tenant shall not place or permit to be placed any
sign on the Premises, the Building or the Site without the prior written
approval of Landlord, which approval shall include approval of the style, size
and design of the sign, but shall not be unreasonably withheld. Notwithstanding
the foregoing, Tenant may only place signs in the locations designated on
Exhibit A. All such signs shall comply with any and all applicable laws,
regulations and restrictions and shall be the sole cost and responsibility of
Tenant. Landlord may require their removal at Tenant's sole cost and expense
upon the expiration or earlier termination of this Lease. Tenant shall not place
or permit to be placed any other notices or advertisements on the Premises, the
Building or the Site.
SECTION 10.19. MAINTENANCE. Except as otherwise provided in Sections 9 and
11, Tenant shall keep and maintain the Premises and all glass in windows in good
order, repair and condition, reasonable wear and tear and damage by fire or
other insured casualty only excepted.
SECTION 11
CASUALTY OR TAKING
SECTION 11.1. TERMINATION. In the event that greater than twenty-five
percent (25%) of the Premises shall be taken by any public authority or for any
public use or destroyed by the action of any public authority (a "Taking") then
this Lease may be terminated by either Landlord or Tenant effective on the
effective date of the Taking. In the event that the Premises shall be destroyed
or damaged by fire or casualty (a "Casualty"), Tenant shall immediately give
notice thereof to Landlord and within thirty (30) days of receipt of such
notice, Landlord shall determine whether it will require in excess of one
hundred eighty (180) days from the date of the Casualty to restore the Premises.
If Landlord determines it will require in excess of one hundred eighty (180)
days from the date of the casualty to restore the Premises, this Lease may be
terminated by
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either Landlord or Tenant by notice to the other within forty-five (45) days
after the casualty. In the case of a Taking such election, which may be made
notwithstanding the fact that Landlord's entire interest may have been divested,
shall be made by the giving of notice by Landlord or Tenant to the other within
thirty (30) days after Landlord or Tenant, as the case may be, shall receive
notice of the Taking.
SECTION 11.2. RESTORATION. In the event of a Taking or a Casualty, if
neither Landlord nor Tenant exercises the election to terminate provided in
Section 11.1, this Lease shall continue in force and a just proportion of the
Fixed Rent and other charges hereunder, according to the nature and extent of
the damages sustained by the Premises shall be abated until the Premises, or
what may remain thereof, shall be put by Landlord in proper condition for use
subject to zoning and building laws or ordinances then in existence, which,
unless Landlord or Tenant has exercised its option to terminate pursuant to
Section 11.1, Landlord covenants to do with reasonable diligence at Landlord's
expense. Landlord's obligations with respect to restoration shall not require
Landlord to expend more than the net proceeds of insurance recovered or damages
awarded for such Casualty or Taking and made available for restoration by
Landlord's mortgagees. "Net proceeds of insurance recovered or damages awarded"
refers to the gross amount of such insurance or damages less the reasonable
expenses of Landlord in connection with the collection of the same, including
without limitation, fees and expenses for legal and appraisal services.
SECTION 11.3. AWARD. Irrespective of the form in which recovery may be had
by law, all rights to damages or compensation from a Taking shall belong to
Landlord in all cases. Tenant hereby grants to Landlord all of Tenant's rights
to such damages and compensation and covenants to deliver such further
assignments thereof as Landlord may from time to time request and Tenant agrees
to reasonably cooperate with Landlord in pursuing such claims. Notwithstanding
the foregoing, Tenant may pursue any claim(s) to which it may be entitled
against a taking authority for reimbursement of relocation expenses, personal
property and trade fixtures.
SECTION 12
DEFAULT
SECTION 12.1. EVENTS OF DEFAULT. If any one or more of the following events
(individually, an "Event of Default") shall occur:
(a) if Tenant shall default in the performance of any of its obligations
to pay the Fixed Rent, Additional Rent or any other sum payable
hereunder and if such default shall continue for ten (10) days after
notice to Tenant;
(b) if Tenant shall fail to observe or perform any other term, covenant,
condition or warranty of this Lease, other than as specified in
subsections (c) through (g) below, and such failure is not cured by
Tenant within a period of thirty (30) days after receipt by Tenant of
notice thereof from Landlord, unless such failure cannot with due
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diligence be cured within a period of thirty (30) days, in which
case such failure shall not be deemed to continue if Tenant
proceeds promptly and with due diligence to cure the failure and
diligently completes the curing thereof within a period of one
hundred twenty (120) days after such notice; or
(c) if any assignment for the benefit of creditors shall be made by
Tenant;
(d) if Tenant's leasehold interest shall be taken on execution or
other process of law in any action against Tenant;
(e) if a lien or other involuntary encumbrance is filed against
Tenant's leasehold interest, and is not discharged, bonded off,
or otherwise secured against to the sole satisfaction of Landlord
within ninety (90) days thereafter;
(f) if a petition is filed by Tenant seeking appointment of a
receiver of Tenant (or of the whole or substantially all of its
property), or for liquidation, or for reorganization or an
arrangement or any other relief under any provision of the
federal bankruptcy laws or any other applicable law or statute of
the United States of America or any state thereof as then in
force and effect; or
(g) if an involuntary petition seeking the relief described in
Section 12.1
(f) is filed against Tenant and such involuntary petition is not
dismissed within ninety (90) days thereafter,
then, and in any of such cases, Landlord and the agents and servants of Landlord
lawfully may, in addition to and not in derogation of any remedies for any
preceding breach of covenant, immediately or at any time thereafter and without
demand or notice and with or without process of law (forcibly, if necessary)
enter into and upon the Premises or any part thereof in the name of the whole,
or mail a notice of termination addressed to Tenant, and repossess the same as
of Landlord's former estate and expel Tenant and those claiming through or under
Tenant and remove its and their effect without being deemed guilty of any manner
of trespass and without prejudice to any remedies which might otherwise be used
for arrears of rent or prior breach of covenant, and upon such entry or mailing
as aforesaid this Lease shall terminate, Tenant hereby waiving all statutory
rights (including, without limitation, rights of redemption, if any) to the
extent such rights may be lawfully waived. Landlord, without notice to Tenant,
may store Tenant's effects, and those of any person claiming through or under
Tenant at the expense and risk of Tenant, and, if Landlord so elects, may sell
such effects at public auction or private sale and apply the net proceeds to the
payment of all sums due to Landlord from Tenant, if any, and pay over the
balance, if any, to Tenant.
SECTION 12.2. Remedies. In the event that this Lease is terminated under
any of the provisions contained in Section 12.1, Tenant shall pay forthwith to
Landlord, as compensation, the excess of the total rent reserved for the residue
of the Term over the fair market rental value of the Premises for the residue of
the term, such excess to be discounted to present value at the then current
Federal Reserve Bank discount rate. In calculating the rent reserved there shall
be included, in addition to the Fixed Rent and Additional Rent, the value of all
other considerations agreed to be paid or performed by Tenant during the
residue. As additional and cumulative obligations after any such termination,
Tenant shall also pay punctually to Landlord all the
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sums and shall perform all the obligations which Tenant covenants in this Lease
to pay and to perform in the same manner and to the same extent and at the same
time as if this Lease had not been terminated. In calculating the amounts to be
paid by Tenant pursuant to the preceding sentence, Tenant shall be credited with
any amount paid to Landlord pursuant to the first sentence of this Section 12.2
and also with the net proceeds of any rent obtained by Landlord by reletting the
Premises, after deducting all Landlord's reasonable expenses in connection with
such reletting, including, without limitation, all repossession costs, brokerage
commissions, fees for legal services and expenses of preparing the Premises for
such reletting, it being agreed by Tenant that Landlord may (i) relet the
Premises or any part or parts thereof for a term or terms which may at
Landlord's option be equal to or less than or exceed the period which would
otherwise have constituted the balance of the term hereof and may grant such
concessions and free rent as Landlord in its reasonable judgment considers
advisable or necessary to relet the same and (ii) make such alterations, repairs
and decorations in the Premises as Landlord in its reasonable judgment considers
advisable or necessary to relet the same, and no action of Landlord in
accordance with the foregoing or failure to relet or to collect rent under
reletting shall operate or be construed to release or reduce Tenant's liability
as aforesaid.
SECTION 12.3. REMEDIES CUMULATIVE. Except as otherwise expressly provided
herein, any and all rights and remedies which Landlord may have under this Lease
and at law and equity shall be cumulative and shall not be deemed inconsistent
with each other, and any two or more of all such rights and remedies may be
exercised at the same time to the greatest extent permitted by law.
SECTION 12.4. LANDLORD'S RIGHT TO CURE DEFAULTS. At any time following ten
(10) days' prior notice to Tenant (except in cases of emergency when no notice
shall be required), Landlord may (but shall not be obligated to) cure any
default by Tenant under this Lease, and whenever Landlord so elects, all costs
and expenses incurred by Landlord, including reasonable attorneys' fees, in
curing a default shall be paid by Tenant to Landlord as Additional Rent on
demand, together with interest thereon at the rate provided in Section 12.7 from
the date of payment by Landlord to the date of payment by Tenant.
SECTION 12.5. EFFECT OF WAIVERS OF DEFAULT. Any consent or permission by
Landlord to any act or omission which otherwise would be a breach of any
covenant or condition herein, or any waiver by Landlord of the breach of any
covenant or condition herein, shall not in any way be held or construed (unless
expressly so declared) to operate so as to impair the continuing obligation of
any covenant or condition herein, or otherwise operate to permit the same or
similar acts or omissions except as to the specific instance. The failure of
Landlord to seek redress for violation of, or to insist upon the strict
performance of, any covenant or condition of this Lease shall not be deemed a
waiver of such violation nor prevent a subsequent act, which would have
originally constituted a violation, from having all the force and effect of an
original violation. The receipt by Landlord of rent with knowledge of the breach
of any covenant of this Lease shall not be deemed to have been a waiver of such
breach by Landlord or of any of Landlord's remedies on account thereof,
including its right of termination for such default.
SECTION 12.6. NO ACCORD AND SATISFACTION. No acceptance by Landlord of a
lesser sum than the Fixed Rent, Additional Rent or any other charge then due
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shall be deemed to be other than on account of the earliest installment of such
rent or charge due, unless Landlord elects by notice to Tenant to credit such
sum against the most recent installment due. An endorsement or statement on any
check or any letter accompanying any check or payment as rent or other charge
shall not 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 installment or pursue any other remedy under this Lease or otherwise.
SECTION 12.7. INTEREST ON OVERDUE SUMS. If Tenant fails to pay Fixed Rent,
Additional Rent or any other sum payable by Tenant to Landlord by the due date
thereof (i.e., the due date disregarding any requirement of notice from Landlord
or any period of grace allowed to Tenant), the amount so unpaid shall bear
interest, at a variable rate per annum (the "Delinquency Rate") equal to the
greater of (i) four percent (4%) in excess of the base rate (prime rate) of The
First National Bank of Boston from time to time in effect or (ii) the maximum
interest rate permissible under applicable law, commencing with the due date and
continuing through the day on which payment of such delinquent payment with
interest thereon is paid.
SECTION 13
MORTGAGES
SECTION 13.1. RIGHTS OF MORTGAGE HOLDERS. No Fixed Rent, Additional Rent or
any other charge shall be paid more than ten (10) days prior to the due date
thereof and payments made in violation of this provision shall (except to the
extent that such payments are actually received by a mortgagee in possession or
in the process of foreclosing its mortgage) be a nullity as against such
mortgagee and Tenant shall be liable for the amount of such payments to such
mortgagee.
In the event of any act or omission by Landlord which would give Tenant the
right to terminate this Lease or to claim a partial or total eviction, Tenant
shall not exercise any such right (a) until it shall have given notice, in the
manner provided in Section 14.1, of such act or omission to any Lender whose
name and address shall have been furnished to Tenant in writing, at the last
address so furnished, and (b) until a reasonable period of time for remedying
such act or omission shall have elapsed following the giving of such notice,
provided that following the giving of such notice, Landlord or such Lender
shall, with reasonable diligence have commenced and continued to remedy such act
or omission or to cause the same to be rendered.
In the event any proceedings are brought for the foreclosure of, or in the
event of exercise of the power of sale under, any mortgage now or hereafter
encumbering the Premises, Tenant shall attorn to the purchaser upon such
foreclosure or sale or upon any grant of a deed in lieu of foreclosure and
recognize such purchaser as Landlord under this Lease.
SECTION 13.2. SUPERIORITY OF LEASE; OPTION TO SUBORDINATE. Unless Landlord
exercises the option set forth below in this Section 13.2, this Lease shall be
superior to and shall not be subordinate to any mortgage on the Premises.
Landlord shall have the option to subordinate this Lease to any mortgage of the
Premises provided that the holder of record thereof enters into an agreement
with Tenant, in such holder's customary form, by the terms of which such holder
will agree to (a) recognize the rights of Tenant under this Lease, (b) perform
Landlord's obligations hereunder arising after the date of such
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holder's acquisition of title and (c) accept Tenant as tenant of the Premises
under the terms and conditions of this Lease in the event of acquisition of
title by such holder through foreclosure proceedings or otherwise and Tenant
will agree to recognize the holder of such mortgage as Landlord in such event,
which agreement shall be made expressly to bind and inure to the benefit of the
successors and assigns of Tenant and of the holder and upon anyone purchasing
the Premises at any foreclosure sale. Tenant agrees to execute and deliver any
appropriate instruments necessary to carry out the agreements contained in this
Section 13.2.
SECTION 14
MISCELLANEOUS PROVISIONS
SECTION 14.1. NOTICES FROM ONE PARTY TO THE OTHER. For the purposes of this
Lease, all notices, demands, requests, or refusal to accept delivery which may
be or are required to be given under this Lease shall be in writing and shall be
given by personal delivery, or by certified mail, return receipt requested,
postage prepaid, or by Federal Express or similar nationally recognized
overnight courier, charges prepaid, and addressed to Landlord at Communications
& Power Industries, Inc., Attention: Facilities Manager, 150 Sohier Road,
Beverly, Massachusetts 01915, and addressed to Tenant at Converter Power Inc.,
Attention: Wendy Ventura, 148 Sohier Road, Beverly, Massachusetts 01915. The
addresses of the parties may be changed from time to time by notice given in the
manner set forth in this Section 14.1. Each notice, request, demand, advice or
designation given under this Lease shall be deemed properly given upon actual
receipt by the party to whom the same is addressed. Any notice shall be deemed
duly given when delivered or tendered for delivery at such address.
SECTION 14.2. QUIET ENJOYMENT. Landlord agrees that upon Tenant's paying
the Fixed Rent, Additional Rent and all other sums due hereunder and performing
and observing the terms, covenants, conditions and provisions on its part to be
performed and observed, Tenant shall and may peaceably and quietly have, hold
and enjoy the Premises during the term without any manner of hindrance or
molestation from Landlord or anyone claiming under Landlord, subject, however,
to the terms of this Lease.
SECTION 14.3. LEASE NOT TO BE RECORDED; NOTICE OF LEASE. Tenant agrees that
it will not record this Lease. If the Term of this Lease, including options
and/or extensions, exceeds seven years, Landlord and Tenant agree that, on the
request of either, they will enter and record a notice of lease in form
reasonably acceptable to Landlord.
SECTION 14.4.. BIND AND INURE; LIMITATION OF LANDLORD'S LIABILITY. The
obligations of this Lease shall run with the land, and this Lease shall be
binding upon and inure to the benefit of the parties hereto and their respective
successors and assigns. No owner of the Premises shall be liable under this
Lease except for breaches of Landlord's obligations occurring while such party
is the owner of the Premises. The obligations of Landlord shall be binding upon
the assets of Landlord which comprise the Building but not upon other assets of
Landlord. No individual partner, trustee, stockholder, officer, director,
employee or beneficiary of Landlord shall be personally liable under this Lease
and Tenant shall look solely to Landlord's interest in the Premises in pursuit
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of its remedies upon an event of default hereunder, and the general assets of
Landlord and its partners, trustees, stockholders, officers, employees or
beneficiaries of Landlord shall not be subject to levy, execution or other
enforcement procedure for the satisfaction of the remedies of Tenant. Landlord
shall not have any liability to Tenant for any incidental or consequential
damages arising out of or related to the services provided under this Lease,
including, but not limited to, the loss of use, revenue or profit arising from
any delay or failure of Landlord's performance hereunder or for any defects or
problems related thereto. Landlord's sole liability shall be to refund an
equitable portion of the Fixed Rent paid by Tenant for such service or services
which are the subject of claim or dispute.
SECTION 14.5. ACTS OF GOD. Excepting only the obligation of Tenant to pay
any monetary amount due hereunder, in any case where either party hereto is
required to do any act, delays caused by or resulting from acts of God, war,
civil commotion, fire, flood or other casualty, labor difficulties, shortages of
labor, materials or equipment, government regulations, unusually severe weather,
or other causes beyond such party's reasonable control (other than financial
inability) shall not be counted in determining the time during which work shall
be completed, whether such time be designated by a fixed date, a fixed time or a
"reasonable time", and such time shall be deemed to be extended by the period of
such delay.
SECTION 14.6. LANDLORD'S DEFAULT. Landlord shall not be deemed to be in
default in the performance of any of its obligations hereunder unless it shall
fail to perform such obligations and unless within thirty (30) days after notice
from Tenant to Landlord specifying such default Landlord has not commenced
diligently to correct the default so specified or has not thereafter diligently
pursued such correction to completion. Tenant shall have no right, for any
default by Landlord, to offset or counterclaim against any rent due hereunder.
SECTION 14.7. BROKERAGE. Landlord is responsible for paying one commission
to "Broker", and Landlord agrees to pay such commission. Tenant warrants and
represents to Landlord that it has had no dealings with any broker or agent in
connection with this Lease except "Broker", and covenants to defend with counsel
approved by Landlord, hold harmless and indemnify Landlord from and against any
and all cost, expense or liability for any compensation, commissions and charges
claimed by any broker or agent with whom it has dealt and the costs incurred by
Landlord in connection with the enforcement of this indemnification agreement.
Landlord warrants and represents to Tenant that it has had no dealings with any
broker or agent in connection with this Lease except "Broker", and covenants to
defend with counsel approved by Tenant, hold harmless and indemnify Tenant from
and against any and all cost, expense or liability for any compensation,
commissions and charges claimed by any broker or agent with whom it has dealt
and the costs incurred by Tenant in connection with the enforcement of this
indemnification agreement. The aforesaid indemnification agreement shall survive
the expiration or earlier termination of this Lease.
SECTION 14.8. MISCELLANEOUS. This Lease shall be governed by and construed
in accordance with the laws of the Commonwealth of Massachusetts. This Lease
constitutes the entire agreement between the parties with respect to the subject
matter hereof and supersede all prior and contemporaneous agreements,
representations, warranties, and understandings of the parties, written and
oral, which pertain to said subject matter. No supplement, modification or
amendment of this Lease shall be binding unless executed in writing by
authorized representatives of the parties hereto.
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SECTION 14.9. CORPORATE AUTHORITY. Each individual executing this Lease on
behalf of its respective corporation represents and warrants that such
corporation is validly formed, duly authorized and existing, qualified to do
business in the state of Massachusetts, has the full right and legal authority
to enter into this Lease, and that such individual is duly authorized to execute
and deliver this Lease in accordance with such corporation's bylaws and/or a
Board of Directors resolution, and that this Lease is binding upon the parties
in accordance with all the terms and conditions therein.
SECTION 14.10. HEADINGS, EXHIBITS. The subject headings of the Sections of
this Lease are included for purposes of convenience of reference only, and shall
not effect the construction or interpretation of this Lease. All Exhibits
referred to herein are a part of this Lease.
SECTION 14.11. SEVERABILITY. If any one or more of the provisions, or a
portion of any such provision, of this Lease shall be deemed to be contrary to
law, invalid, illegal or unenforceable in any respect by any governmental agency
or court of law having competent jurisdiction over the subject matter and the
parties hereto, the remaining provisions shall be severable and enforceable in
accordance with their terms. It is the express intent of the parties that in the
event that any term, provision or portion of this Lease is deemed contrary to
law, invalid, illegal or unenforceable, the parties shall make whatever
reasonable adjustments in their arrangements, if any are required, as may be
mutually fair in light of their original intent as reflected in this Lease.
SECTION 14.12. TIME OF ESSENCE. Time is of the essence in regard to all
obligations provided for in the Lease. Section 14.13. Grants and Easements.
During the Term, Landlord reserves to itself the right, from time to time, to
grant any easements, rights, restrictions and dedications (collectively,
Grants), as it may deem necessary or as may be required by law and to cause the
recording of any instruments evidencing such Grants, provided that such Grants
do not unreasonably interfere with the use of the Premises by Tenant. Tenant
agrees to fully cooperate in relocating any such Grants which will not
unreasonably interfere with Tenant's use of the Premises. Tenant shall sign any
agreements with respect to such Grants as may be reasonably requested by
Landlord and Tenant's failure to do so shall constitute a material breach of
this Lease.
SECTION 14.14. COUNTERPARTS. This Lease may be executed in counterparts,
each of which shall be valid and binding original, but all of which together
shall constitute one and the same instrument. The signature page and
acknowledgment of any counterpart may be removed therefrom and attached to any
other counterpart to evidence execution thereof by all of the parties hereto
without affecting the validity thereof.
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WITNESS the execution hereof under seal as of the day and year first above
written.
Tenant:
CONVERTER POWER INC., a
Massachusetts corporation
By ---------------------------------
Name:
Title:
Landlord:
COMMUNICATIONS & POWER
INDUSTRIES, INC., a Delaware
corporation
By: --------------------------------
Name:
Title:
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