EXHIBIT 10.8
SUBLEASE AGREEMENT
This Sublease dated as of September 1, 2000 is made between Nortel Networks
(CALA) Inc., a Florida corporation ("Sublandlord"), and Convergent Networks
Inc., a Delaware corporation ("Subtenant").
Background
A. Sublandlord is the tenant under the Lease dated on or about January 15,
1998, a copy of which is attached hereto as Exhibit A and hereby made a
part hereof ("Master Lease"), wherein Sawgrass Center Associates, as
landlord ("Master Landlord"), leased to Sublandlord the entire fourth,
third, and second floors and a portion of the first floor, consisting of
approximately 73,876 rentable square feet, of certain real property known
as the Corporate Centre at Sawgrass, Phase II, located at 1571 Sawgrass
Corporate Parkway, Sunrise, FL 33323 ("Master Premises").
B. Sublandlord and Subtenant now wish to enter into a sublease of a portion of
the premises covered by the Master Lease, on the terms and conditions of
this Sublease.
NOW, THEREFORE, the parties agree as follows:
1. PREMISES
Sublandlord hereby subleases to Subtenant on the terms and conditions set
forth in this Sublease a portion of the Master Premises, consisting of the
entire fourth floor, as highlighted on the floorplan attached hereto as
Exhibit B ("Premises"), of the Master Premises, consisting of approximately
24,090 rentable square feet. No later than five days after the date of this
Sublease, Sublandlord shall provide Subtenant with drawings of the Premises
(including voice and data wiring layouts) and a CAD disk of the
improvements in the Premises. The sublease of the Premises includes
Subtenant's use, at no charge, of the furniture (the "Furniture"), wiring,
and other existing improvements in the Premises. The Furniture will be
delivered in an "as is" condition, however Sublandlord will assign any
warranty rights, if such rights are assignable and are available.
2. TERM
The term of this Sublease shall commence, as to occupancy, on or about
September 1, 2000, or as soon thereafter as this Sublease is signed by both
parties hereto and approved by the Master Landlord ("Commencement Date");
with rent payments and payments on account of Operating Expense, to
commence on December 1, 2000 (the "Rent Commencement Date"). The term shall
continue until January 14, 2004, unless terminated prior to such date
pursuant to the terms hereof. Sublandlord shall use reasonable efforts to
assist Subtenant in requesting a term renewal from the Master Landlord.
3. RENT
Commencing on the Rent Commencement Date, Subtenant shall pay to
Sublandlord as base monthly rent for the Premises, without deduction,
offset, notice, or demand, at 1500 Concord Terrace, Sunrise, FL 33323,
attn.: Manuel Gonzalez, or at such other place as Sublandlord shall
designate from time to time by notice to Subtenant, the annual sum of
$14.50 per rentable square foot, equal to $29,108.75 per month ("Base
Monthly Rent"). This base rent shall increase at a rate of 3% per year,
compounded annually, effective on December 1, 2001, and on December 1 of
each year thereafter during the term of this Sublease. This Base Monthly
Rent shall be paid each month by Subtenant during the term and shall be
paid in advance on or before the first day of each calendar month during
said period.
4. NET LEASE; OPERATING EXPENSES
Commencing on the Rent Commencement Date, Subtenant shall pay to
Sublandlord Subtenant's percentage share for all insurance, taxes, building
operating costs and any other charges, fees, assessments or expense's
payable by Sublandlord under the Master Lease ("Operating Expenses").
"Subtenant's percentage share" shall be one hundred percent 100%) of all
such Operating Expenses attributed to the Premises (estimated for year 2000
to be $7.95 per rentable square foot, excluding janitorial expenses which
are to be borne by Subtenant). Sublandlord shall pass through to Subtenant
Subtenant's Percentage Share of all Operating Expenses charged to
Sublandlord as and when billed by Master Landlord, for the 4th floor
Premises, subject to all caps and exclusions per the Master Lease.
Subtenant shall pay Subtenant's percentage share of Operating Charges as
estimated from time to time by Master Landlord (subject to late adjustment)
as additional rent. Unless otherwise specified, all payments of Subtenant's
percentage share of Operating Expenses shall be payable in full on the date
that the next installment of base monthly rent is payable.
5. INSURANCE
Subtenant shall also be obligated to carry any insurance required under the
Master Lease covering the Premises or any tenant or subtenant improvements
therein with any liability insurance naming Sublandlord as an additional
insured. In addition, Subtenant shall carry insurance for the fully
insurable amount covering all of Subtenant's personal property on the
Premises. All insurance obtained by Subtenant shall contain a waiver of
subrogation clause in favor of Sublandlord and Master Landlord. All
property insurance obtained by Sublandlord and Master Landlord shall
contain a waiver of subrogation clause in favor of Subtenant.
6. SECURITY DEPOSIT
Subtenant shall pay to Sublandlord a security deposit in the amount of
$116,435.00 ($58,217.50 of which may be provided in the form of a letter of
credit from a financial institution reasonably acceptable to Sublandlord)
upon execution of this Sublease as security for full performance of all
obligations of this Sublease. Subtenant shall be
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required to leave the Premises in broom clean condition and in the same
condition as of the commencement of this Sublease, normal wear and tear
excepted, or Sublandlord may appropriate all or part of this deposit to
repair any damage to the Premises. If Subtenant is not in default
hereunder. Sublandlord shall return the deposit, if any remains, to
Subtenant within thirty (30) days after the Sublease terminates.
Sublandlord shall not be required to keep this deposit separate from its
general funds, and Subtenant is not entitled to interest.
7. USE OF PREMISES
The Premises shall be used and occupied in accordance with the Use of
Premises provision in the Master Lease.
8. ASSIGNMENT AND SUBLETTING
Subtenant shall not assign this Sublease or further sublet all or any part
of the Premises without the prior written consent of Sublandlord and of
Master Landlord, which the consent of either or both may be withheld for
any reason in their respective discretion; provided, however, that
Sublandlord shall not unreasonably withhold its consent with respect to
assignments or sublets to Subtenant's affiliates.
9. PROVISION OF SERVICES
No services are currently included in base rent except for any provided by
Master Landlord to Sublandlord under the Master Lease. If Sublandlord
furnishes the Premises with any additional services upon request of
Subtenant, Sublandlord shall charge Subtenant the out of pocket cost of
providing such additional service, and Subtenant shall pay the additional
charge within thirty days after billing by Sublandlord.
10. CONDITION OF PREMISES; TRADE FIXTURES
Subtenant accepts the Premises in their "as is" condition as of the
Commencement Date, provided that the Premises shall be (a) broom clean, (b)
contain the Furniture and other improvements located therein on the date of
this sublease, and (c) vacant. Subtenant shall have the right to furnish
and install any trade fixtures that are necessary for the conduct of its
business; provided, however, that at the termination of this Sublease,
Subtenant shall, if required by Sublandlord, remove such trade fixtures and
restore the Premises at Subtenant's sole cost to the state and condition in
which they existed on the Commencement Date, ordinary wear and tear
excepted. If Subtenant fails to comply with the provisions of this
paragaph, Sublandlord may make such repairs or restoration, and the
reasonable cost thereof shall be additional rent payable by Subtenant on
demand. All trade fixtures shall be and remain the property of Subtenant,
provided that any such trade fixtures remaining on the Premises after the
expiration or termination of the term hereof shall be deemed abandoned by
Subtenant and shall, at Sublandlord's option, become the property of
Sublandlord without payment therefor.
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11. ALTERATIONS AND IMPROVEMENTS
Sublandlord shall have no obligation to make any alterations or
improvements to the Premises for Subtenants use or occupancy thereof.
Subtenant shall have the same rights to make alterations as granted to
Sublandlord under the Master Lease, subject to Sublandlord's approval which
shall not be unreasonably withheld. Any alterations and additions to the
Premises made by Subtenant shall be at Subtenant's expense and shall be
made in accordance with the Master Lease, and shall be subject to prior
written approval of Sublandlord and Master Landlord to the extent required
under the Master Lease. Sublandlord shall not unreasonably withhold its
consent to any alterations. Subtenant shall bear any costs charged by
Master Landlord in reviewing Subtenant's alterations or
plans/specifications for same. At Sublandlord's option, all alterations,
additions and improvements (except for movable trade fixtures) shall be and
remain the property of Sublandlord upon installation and shall be
surrendered to Sublandlord upon the termination of this Sublease, or shall
be removed by Subtenant and the Premises restored to their condition on the
Commencement Date pursuant to the Master Lease. If Master Landlord requires
such removal and restoration and Subtenant fails to comply, Sublandlord may
do so and the reasonable cost thereof shall be additional rent payable by
Subtenant on demand.
Subtenant desires to build out within the Premises, a "computer lab."
Should the plans and specifications for such computer lab be acceptable to
Sublandlord, consistent with the terms of this section, then Sublandlord
will use reasonable efforts to assist Subtenant in obtaining the approval
of the Master Landlord, and to obtain any necessary plans for the Premises
or the building where the Premises are located.
12. SUBORDINATION TO MASTER LEASE
This Sublease shall at all times be subject and subordinate to the terms
and provisions of the Master Lease except as otherwise expressly set forth
herein. Except as otherwise set forth in this Sublease and except for
Sections 1.1(a), 1.1(b), 1.3 and 1.4 of the Master Lease, all of the terms
and conditions contained in the Master Lease are hereby incorporated herein
by this reference as terms and conditions of this Sublease, with each
reference to Lessor and Lessee (or Landlord and Tenant, as applicable)
therein to be deemed to refer to Sublandlord and Subtenant respectively
herein. Unless mutually agreed upon by Sublandlord and Subtenant in
writing, Sublandlord covenants and agrees that Sublandlord shall not enter
into any modification or other agreement with respect to the Master Lease
which would materially adversely effect the use by Subtenant of the
Premises in accordance with the terms of this Sublease. Subject to the
foregoing sentence, unless mutually agreed upon by Sublandlord and
Subtenant in writing, Sublandlord covenants and agrees that Sublandlord
shall not enter into any modification or other agreement with respect to
the Master Lease which would materially adversely affect the use by
Subtenant of the Premises in accordance with the terms of this Sublease.
Sublandlord shall have the right but shall not be obligated to agree with
the Master Landlord to any amendment to the Master Lease which the
Sublandlord in its discretion deems to be appropriate, without the approval
of the Subtenant. Sublandlord shall give Subtenant written notice of any
such amendment, and such amendment shall be deemed to be binding on
Subtenant hereunder.
Upon the breach of any of the terms, conditions or covenants of the Master
Lease or upon the failure of Subtenant to pay rent or comply with any of
the provisions of this
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Sublease, after Subtenant has received prior written notice and had an
opportunity to cure, Sublandlord may exercise any and all rights and
remedies granted to Master Landlord by the Master Lease. In the event that
Subtenant breaches any of the terms conditions or covenants of this
Sublease or of the Master Lease and fails to remedy such breach within
fifteen (15) days of written notice, Sublandlord has the right, but not the
obligation, to cure such breach and bill Subtenant for the costs incurred
thereby, which costs Subtenant shall pay to Sublandlord upon demand.
Subtenant shall not commit or suffer any act or omission that will violate
any of the provisions of the Master Lease. If the Master Lease terminates,
this Sublease shall terminate and the parties shall be relieved of any
further liability or obligation under this Sublease; provided '. however,
that Subtenant shall pay to Sublandlord all sums due and accrued under this
Sublease as of the termination date.
13. INDEMNITY
Each party shall indemnify and hold harmless the other from liability,
losses, damage, claims, suits or actions, judgments and expenses,
(including reasonable attorney's fees) which may arise or grow out of
injury to or death of any person or damage to any tangible property caused
by the negligence or willful misconduct of such party, its agents,
employees, or contractors. In case either party shall without fault on its
part be made a party to any litigation commenced by or against such party
for which it is to be indemnified hereunder, then the other party shall
protect and hold harmless and pay all costs, penalties, charges, damages,
expenses, and reasonable attorney's fees incurred or paid by the party
indemnified hereunder.
14. HOLDING OVER
If Subtenant, with Sublandlord's and Master Landlord's written consent,
remains in possession of the Premises or any part thereof after the
expiration or other termination of the term hereof, such occupancy shall be
a tenancy at sufferance at a rental in the amount of one hundred and fifty
percent (150%) of the last monthly base rent installment and Operating
Expenses, and upon all the other provisions of this Sublease pertaining to
the obligations of Subtenant. Notwithstanding anything to the contrary
herein, Subtenant shall pay to Sublandlord all costs incurred by
Sublandlord as a result of Subtenant's holding over.
15. ATTORNEYS' FEES
If Sublandlord or Subtenant shall commence an action against the other
arising out of or in connection with this Sublease, the prevailing party
shall be entitled to recover its costs of suit and reasonable attorneys'
fees.
16. NOTICES OR DEMANDS
Except as otherwise provided herein, all notices or demands herein provided
to be given or made, or which may be given or made by either party to the
other, shall be in writing and shall be deemed to have been duly given and
made when deposited in the United States mail, certified mail, return
receipt requested, postage prepaid and addressed as set
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out below, or when deposited with a recognized and established overnight
delivery service, return receipt requested, freight prepaid and addressed
as set out below:
To Sublandlord: Nortel Networks (CALA) Inc.
1500 Concord Terrace
Sunrise, FL 33323
Attn: Manuel Gonzalez
To Subtenant: Convergent Networks Inc.
900 Chelmsford Street
Tower E
Lowell, MA 01851
Attn.: Robert Chow, General Counsel
Notices shall be deemed received and effective upon receipt as evidenced by
the U.S. Postal Service return receipt card or upon delivery by a
nationally recognized overnight courier. The address to which notices or
demands may be given or made by either party may be changed by written
notice given by such party to the other pursuant to this paragraph.
17. DISCLAIMER OF CONSEQUENTIAL DAMAGES
In no event shall Master Landlord or Sublandlord and/or any of their
respective affiliates, including without limitation any corporations or
other entities controlling, controlled by or under common control with any
of them, be liable for any consequential damages suffered by Subtenant in
connection with any breach of this Sublease or otherwise.
18. MASTER LANDLORD'S CONSENT
Promptly following the execution and delivery of this Sublease by Landlord
and Subtenant, Sublandlord shall submit this Sublease to Master Landlord
and use reasonable efforts to obtain Master Landlord's consent.
19. CHOICE OF LAW
This Sublease shall be governed by the laws of the State of Florida, except
for its conflict of law rules.
20. ENTIRE AGREEMENT
This Sublease, along with any exhibits and attachments hereto and the
Master Lease, constitutes the entire agreement between Sublandlord and
Subtenant relative to the Premises, and this Sublease and the exhibits and
attachments may be altered, amended or revoked only by an instrument in
writing signed by both Sublandlord and Subtenant and consented to by Master
Landlord. Sublandlord and Subtenant agree hereby that all prior or
contemporaneous oral agreements between and among themselves and their
agents and representatives relative to the subleasing of the Premises are
merged in or revoked by this Sublease.
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21. SUCCESSORS AND ASSIGNS
This Sublease shall inure to the benefit of and be binding upon the
respective heirs, administrators, executors, successors and assigns of the
parties hereto; provided, however, that this provision shall not be
construed to allow an assignment or subletting which is otherwise
specifically prohibited herein.
22. SECTION AND PARAGRAPH HEADINGS
The section and paragraph headings are included only for the convenience of
the parties and are not part of this Sublease and shall not be used to
interpret the meaning of provisions contained herein or the intent of the
parties hereto.
23. WARRANTY BY SUBTENANT
Subtenant agrees to comply with and abide by all of the terms and
conditions of this Sublease and the Master Lease (including the terms of
the Master Lease incorporated herein by reference). Where the terms and
conditions of the Master Lease are contradictory to the terms and
conditions of this Sublease, the terms of the Sublease shall apply.
24. WARRANTY BY SUBLANDLORD
Sublandlord warrants and represents to Subtenant that Sublandlord has no
knowledge of any claim that Sublandlord is in default or breach of any of
the provisions of the Master Lease, and that all rent and other charges
under the Master Lease have been paid through September 31, 2000.
25. SIGNAGE
Subtenant shall be permitted to display its name and logo in the elevator
lobby and entry doors on the 4 th floor. Subtenant shall also be provided
with a portion of the Building's monument sign to display its name and/or
logo, subject to Master Landlord's approval.
26. SATELLITE DISH AND FIBER OPTICS
Subject to Master Landlord's and Sublandlord's (Sublandlord's approval not
to be unreasonably withheld) approval, Subtenant, at its expense, shall
have the right to install satellite dishes and fiber optics equipment on
the roof or ground of the building, with all necessary cables, wires,
transformers, etc. at any time during the term of the Sublease. Said
installation will conform to all applicable laws, codes, ordinances, etc.
Subtenant shall indemnify Master Landlord and Sublandlord for any and all
costs arising from the installation, maintenance, existence and removal of
any such dishes and equipment.
27. PARKING
Subtenant shall have all parking rights provided to Sublandlord by the
Master Lease, proportionate to the Subtenant's share of the Master
Premises.
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28. ACCESS
Subject to the terms of the Master Lease, Subtenant shall have access to
the Premises 24 hours per day, seven days per week, 365/6 days per year.
IN WITNESS WHEREOF, the parties have caused this Sublease to be signed by their
duly authorized representatives to be effective on the date first set out above.
Sublandlord: Subtenant:
NORTEL NETWORKS (CALA INC. CONVERGENT NETWORKS INC.
By: Marcia Mosquera By:
Name: Assistant Secretary Name:
Title:
Name: Joe Dearing
Title: Assistant Secretary
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