EXHIBIT 10.1
NORTH ANDOVER MILLS
NORTH ANDOVER, MASSACHUSETTS
LEASE
LANDLORD: NORTH ANDOVER MILLS REALTY,
a Massachusetts Limited Partnership
TENANT: FTP SOFTWARE, INC., a Massachusetts Corporation
DATE: November 19, 1991
BUILDING NOS.: 1A (top Three Floors), 3, 3A (Top Floor), 11 (Top Floor), and
32 (portions of Top Three Floors)
LEASE NO.: 33A
TABLE OF CONTENTS
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Page
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1. BASIC LEASE PROVISIONS.................................................. 1
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2. CONSTRUCTION OF PREMISES................................................ 3
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3. POSSESSION AND SURRENDER OF PREMISES.................................... 4
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4. TERM.................................................................... 4
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5. RENT.................................................................... 4
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6. TAXES................................................................... 4
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7. OPERATING COSTS......................................................... 5
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8. INSURANCE............................................................... 6
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9. MONTHLY PAYMENT OF TAXES, OPERATING COSTS AND INSURANCE
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PREMIUMS................................................................ 7
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10. UTILITIES............................................................... 8
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11. USE OF PREMISES......................................................... 8
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12. MAINTENANCE AND REPAIRS................................................. 9
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13. ALTERATIONS............................................................. 10
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14. INDEMNITY; SATISFACTION OF REMEDIES..................................... 12
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15. COMMON AREA AND PARKING................................................. 13
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16. DAMAGE OR DESTRUCTION................................................... 13
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17. CONDEMNATION............................................................ 14
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18. ASSIGNMENT AND SUBLETTING............................................... 15
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19. MORTGAGEE PROTECTION.................................................... 17
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20. ESTOPPEL CERTIFICATES................................................... 18
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21. DEFAULT................................................................. 18
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22. REMEDIES FOR DEFAULT.................................................... 19
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23. (SEE EXHIBIT "F" - BANKRUPTCY AND INSOLVENCY).......................... 21
24. GENERAL PROVISIONS...................................................... 21
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25. HAZARDOUS SUBSTANCES.................................................... 26
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EXHIBIT LIST
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"A" Project Site Plan
"B" Premises
"C" Workletter (including Attachment "CC")
"D" Base Rent
"E" Current Rules and Regulations
"F" Bankruptcy Provisions
Rider #1 Storage Space/Right of First Offer/Expansion Options
Rider #2 Extension Option
Rider #3 Right to Change Project
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INDEX TO DEFINED TERMS
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Term Section Page
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Affiliates 24.18(a)
Alterations 13
Bankruptcy Code Exhibit "F"
Base Rent 1.1(e)
Building 1.1(d)
Common Area 15
Condemnation 17
Expansion Options 28 Rider #1
Expansion Space 28 Rider #1
Guarantor 1.1(k)
Hazardous Substances 25
Landlord's Mortgagee 19.1
Landlord's Work 2
Laws 24.18(b)
Lease Year 4
Liabilities 24.18(c)
Liens 13.4
Maximum Amount 1.2 Exhibit "C"
Offer Space 27 Rider #1
Operating Costs 7.1
Option Rider #2
Premises 1.3
Project 1.2
Rent 5
Rent Commencement Date 1.1(a)
Security Deposit 1.1(g)
Storage Space 26
Systems and Equipment 24.18(d)
Superior Leases and Mortgages 24.4
Taxes 6.2
Tenant's Broker 1.1(1)
Tenant's Percentage 1.1(f)
Tenant's Property 3
Transfer 18.1
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LEASE
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THIS INDENTURE OF LEASE, dated as of November 19, 1991, is between
NORTH ANDOVER MILLS REALTY, a Massachusetts Limited Partnership ("Landlord"),
and FTP SOFTWARE, INC., a Massachusetts corporation ("Tenant").
Landlord leases the Premises to Tenant and Tenant leases the Premises
from Landlord on the following terms and conditions:
1. BASIC LEASE PROVISIONS.
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1.1 Summary.
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(a) Rent Commencement Date: Ten (10) days after Landlord's Work is
substantially completed or June 1, 1992, whichever is later, but if Tenant
occupies the Premises for the conduct of its business earlier, then the
Rent Commencement Date will be the date that Tenant so occupies.
(b) Term: Ten (10) Lease Years after the Rent Commencement Date,
subject to extension as provided in Rider #2 or earlier termination in
accordance with this lease.
(c) Premises: Buildings 1A (top three floors), 3, 3A (top floor), 11
(top floor), and 32 (portions of top three floors), all as shown in Exhibit
"B". The Premises have an initial agreed rentable area of seventy-three
thousand four hundred ninety-one (73,491) square feet, which will be
increased if more space is leased as described in Rider #1.
(d) Buildings: The complexes of buildings that are contiguous or
immediately adjacent to the Premises as the Premises are constituted from
time to time.
(e) Base Rent: (see Exhibit "D").
(f) Tenant's Percentage: 13.43%, subject to proportional increase if
the size of the Premises increases pursuant to this Lease.
(g) Security Deposit: $120,000.00.
(h) Use of Premises: As offices and for the packaging, creation and
duplication of computer software, light assembly, testing, configuring
computer hardware, and training (but no manufacturing).
(i) Notice to Tenant Before Possession of Premises:
27 Water Street
Wakefield, Massachusetts 01880-3004
Attn: Nancy L. Connor, President
With a copy to:
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Edward Rosner, Esq.
Flott & Romero
919 18th Street, N.W.
Washington, D.C. 20006
(j) Notice to Landlord:
c/o Brickstone Properties, Inc.
300 Brickstone Square
Andover, Massachusetts 01810
Attn: Martin Spagat
With a copy to:
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c/o U.S. Managers Realty, Inc.
433 North Camden Drive
Suite 960
Beverly Hills, CA 90210
Attn: John G. Baker, Esq.
(k) Guarantor: N/A.
(l) Tenant's Broker: Combined Properties, Inc..
(m) Certain Other Defined Terms: [See Section 24.18].
If there is a conflict between this summary and the rest of this Lease, the rest
of this Lease will control.
1.2 Project. Exhibit "A" is the general site plan of the principal
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buildings, improvements and areas that are now part of the project commonly
known as North Andover Hills, North Andover, Massachusetts (the "Project").
Landlord reserves the right to change the Project from time to time.
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1.3 Description of Premises. Landlord reserves the space above hung
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ceilings, below the floor and within the walls of the Premises, and the right to
install, relocate, remove, use, maintain, repair and replace Systems and
Equipment within or serving the Premises or other parts of the Building or the
Project. To the extent that it does not interfere with or damage Landlord's
Work and/or existing Systems and Equipment or the rest of the Building or the
use and occupancy of any other tenant, Tenant, at its cost, may install wiring
for its computers and equipment above hung ceilings and within the interior
walls of the Premises, provided that Tenant otherwise complies with the rest of
this Lease and that Landlord will have no obligations or Liabilities in
connection therewith. Tenant will indemnify and hold Landlord harmless from
Liabilities in connection with this wiring and installation, maintenance and
removal. Tenant will maintain the wiring and, at Landlord's request, will
remove the wiring and repair any damage on the expiration or earlier termination
of this Lease.
2. CONSTRUCTION OF PREMISES.
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(a) Landlord will perform "Landlord's Work" and Tenant will perform
"Tenant's Work" (if any) as described in the Workletter attached as Exhibit
"C" to prepare the Premises for Tenant's initial occupancy. Landlord's Work
will be deemed substantially completed even if Landlord has not completed
"punch list" or other minor items, as long as Landlord agrees to complete
these items. Tenant's final punch list will be submitted to Landlord within
thirty (30) days after Landlord notifies Tenant that Landlord's Work is
substantially completed. At Landlord's option, certification by Landlord's
architect of the substantial completion of Landlord's Work or the issuance
of a temporary or final certificate of occupancy will be binding on the
parties as to the date of substantial completion. Notwithstanding the
foregoing, Landlord's Work will not be deemed substantially complete if any
uncompleted item of Landlord's Work renders the Premises untenantable.
(b) Provided that Tenant does not default, within thirty (30) days
after Tenant occupies the Premises for the conduct of its business,
unconditionally accepts the Premises by written notice to Landlord (except
only for uncompleted items of Landlord's Work which Tenant must specify and
acknowledge in its notice as being, in the aggregate, minor punch list
items which do not affect the tenant ability or Tenant's occupancy of the
Premises) and pays its first month's rent, Landlord will pay to Tenant (or
credit against amounts owed by Tenant): (i) up to One and No/100 Dollar
($1.00) per square foot of usable area in the Premises to reimburse Tenant
for its moving expenses; (ii) up to One and 25/100 Dollar ($1.25) per
square foot of rentable area in the Premises for Tenant's costs for space
planning and layout for the Premises; and (iii) Twenty Thousand and No/100
Dollars ($20,000.00) for Tenant's initial site selection and space
requirement analysis at the Project. To the extent that Tenant's actual
costs in any of the above categories exceed the limits above, Tenant may
reallocate unused amounts from any other category. These costs must be
incurred by Tenant in good faith and at arms length to unaffiliated third
parties. Prior to reimbursement or
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payment, Tenant will provide Landlord with paid invoices and other
reasonable backup information to evidence the reimbursements or payments
claimed.
3. POSSESSION AND SURRENDER OF PREMISES.
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When this Lease terminates, Tenant will remove all of its signs,
movable trade fixtures and equipment, inventory and other personal property
("Tenant's Property"). Tenant's Property remaining after termination will be
deemed abandoned and Landlord may keep, sell, destroy or dispose of its without
any Liabilities to Tenant. Tenant will repair all damage and surrender the
Premises broom clean and in good order, condition and repair, and otherwise in
the same condition as on the Rent Commencement Date, normal wear and tear
excepted.
4. TERM.
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The Lease term begins on the date of this Lease and ends ten (10)
Lease Years after the Rent Commencement Date, unless terminated earlier in
accordance with this Lease or extended per Rider #2. A "Lease Year" is a period
of twelve (12) consecutive calendar months during the Lease term, starting with
the Rent Commencement Date. However, the first Lease Year is the first twelve
(12) full calendar months plus the partial month (if any) after the Rent
Commencement Date if the Rent Commencement Date is not the first day of the
month, and the last Lease Year may be less than twelve (12) months if the Lease
is terminated early.
5. RENT.
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Tenant will pay the annual base rent as shown in Exhibit "D" in equal
monthly installments in advance beginning on the Rent Commencement Date and
thereafter on the first day of each month during the term, prorated for any
portion of a month. The term "rent" includes base rent, additional rent and all
other amounts to be paid by Tenant under this Lease, whether or not specifically
described as rent. All rent due under this Lease will be paid without demand,
deduction, counterclaim or offset of any type in lawful U.S. legal tender at 433
North Camden Drive, Suite 960, Beverly Hills, California 90210, Attn:
Accounting Dept., or to such other person or place as Landlord may from time to
time designate by written notice pursuant to this Lease. Tenant will pay the
first month's base rent when it executes this Lease.
6. TAXES.
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6.1 Definition of Taxes. "Taxes" means all taxes, assessments, and
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other governmental or quasi-governmental levies, charges and fees imposed
against, for or in connection with all or any portion of: the Project; the use,
ownership, leasing, occupancy, operating, management, repair, maintenance,
demolition or improvement of the Project; Landlord's right to receive, or the
receipt of, rent, profit or income from the Project; improvements, utilities and
services, whether because of special assessment districts or
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otherwise; the value of Landlord's interest in the Project; a reassessment due
to any change in ownership or other transfer of all or any portion of the
Project; and fixtures, equipment and other real or personal property used by
Landlord in connection with the Project. Taxes also include, without
limitation, license fees, sales, use, capital and value-added taxes, penalties,
interest and costs incurred in contesting taxes, and any governmental or quasi-
governmental charges or taxes in addition to, in substitution or in lieu of,
partially or totally, any taxes or charges previously included within this
definition, including taxes or governmental or quasi-governmental charges
completely unforeseen by the parties and collected from whatever source. Taxes
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do not include: Landlord's federal, state or municipal net income, franchise,
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excise, inheritance, gift or estate taxes.
6.2 Payment of Taxes. Subject to Article 9, as of the Rent
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Commencement Date Tenant will pay its Tenant's Percentage of all Taxes directly
to Landlord as additional rent within ten (10) days after receipt of Landlord's
bill.
6.3 Tenant's Taxes. Tenant will pay before delinquency all taxes
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assessments, license fees and charges levied, assessed or imposed on Tenant,
Tenant's business operations and Tenant's Property.
7. OPERATING COSTS.
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7.1 Definition of Operating Costs. "Operating Costs" are all costs
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and expenses incurred in connection with the Project and its ownership,
operation, management, maintenance, repair, replacement and improvement,
including, without limitation, costs for: services, costs and utilities not
otherwise directly paid or reimbursed by tenants; materials, supplies and
equipment; deductibles under Landlord's insurance policies; wages and payroll,
including bonuses, (all of which, for existing employees, will not increase by
more than ten percent (10%) per annum, cumulative, and, for employees
subsequently hired, will not increase by more than ten percent (10%) per annum,
cumulative, over their initial wages and payroll, including bonuses); fringe
benefits, workers compensation and payroll taxes; professional and consulting
fees; management fees at prevailing rates or, if no managing agent is retained,
an amount in lieu thereof not in excess of prevailing rates; complying with any
Laws and insurance requirements; "environmental audits" deemed necessary by
Landlord (but no more than once per year); and the Common Area (including the
parking area), Operating Costs do not include: Taxes; depreciation of the
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Project structures and improvements; Landlord's loan or ground lease payments;
brokerage commissions; marketing costs; legal fees and costs to enforce any
leases; and costs to construct new leasable area in the Project. If Landlord in
the future leases space to other tenants on a gross rather than net basis,
Operating Costs will not thereby be increased over what they would have been if
Landlord had leased on a net basis.
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7.2 Payment of Operating Costs. Subject to Article 9, as of the Rent
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Commencement Date Tenant will pay its Tenant's Percentage of Operating Costs as
additional rent within fifteen (15) days after receipt of Landlord's bill.
7.3 Building Operating Costs. From time to time, Landlord may
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determine that certain costs otherwise included within the definition of
Operating Costs more properly relate only or primarily to the Building (as a
hypothetical example, elevator maintenance). If Landlord so elects, these costs
will be deducted from Operating Costs and allocated only to tenants of the
Building, Tenant's share of these costs will be calculated by dividing Tenant's
rentable square footage by the rentable square footage leased to all tenants in
the Building, and Tenant will pay its share of these costs in the manner
described in Section 7.2.
8. INSURANCE.
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8.1 Tenant's Insurance.
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(a) Tenant will maintain during the term:
(i) Comprehensive general public liability insurance (Broad Form
C.G.L.), with contractual liability, cross-liability and fire legal
liability endorsements, protecting against all claims and liabilities
for personal, bodily and other injuries, death and property damage
including, without limitation, broad form property damage insurance,
automobile and personal injury coverage. This insurance also will
insure Tenant's indemnities pursuant to this Lease. The amount of this
insurance will not be less than $5,000,000.00 combined single limit
for each occurrence.
(ii) "All risk" casualty insurance, covering all of Tenant's
Work, Tenant's Property and all Alterations made by or for the benefit
of Tenant. This insurance will be for full replacement value.
(iii) [INTENTIONALLY OMITTED]
(iv) Worker's compensation insurance in statutory limits, and
employer's liability insurance of not less than $1,000,000.00.
(v) Builder's risk insurance (completed value form) for work
required of or permitted to be made by Tenant. The amount of this
insurance will be reasonably satisfactory to Landlord and must be
obtained before any work is begun.
(b) All policies of insurance carried by Tenant must: name Landlord
and its designees as additional insureds; contain a waiver by the insurer of any
right to
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subrogation against Landlord and its Affiliates; be from insurers
acceptable to Landlord; and state that the insurers will not cancel, fail
to renew or modify the coverage without first giving Landlord and any other
additional insureds at least thirty (30) days prior written notice.
(c) Tenant will supply copies of each paid-up policy or a certificate
from the insurer certifying that the policy has been issued and complies
with all of the terms of this Article. The policies or certificates will be
delivered to Landlord within thirty (30) days after this Lease is signed
and renewals provided not less than thirty (30) days before the expiration
of the coverage. Landlord always may inspect and copy any of the policies.
Tenant waives any right to recover against Landlord for Liabilities in
connection with any type of cause or peril which is supposed to be insured
against under the insurance policies required to be maintained by Tenant.
8.2 Landlord's Insurance; Payment; and Waiver of Subrogation.
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(a) Landlord will maintain casualty, liability and other insurance
policies in such amounts, with such deductibles and providing protection
against such perils as Landlord determines to be necessary in its sole
discretion (which may include, without limitation, rental loss insurance
policies). All losses on all policies maintained pursuant to this Article
will be settled in Landlord's name (or as otherwise designated by Landlord)
and proceeds will belong and be paid to Landlord. Landlord makes no
representations or warranties as to the adequacy of any insurance to
protect Landlord's or Tenant's interests. Landlord's insurance policies
will contain waivers of subrogation.
(b) Subject to Article 9, Tenant will pay directly to Landlord as
additional rent Tenant's Percentage of the cost of all premiums for
Landlord's insurance within fifteen (15) days after receipt of Landlord's
bill.
(c) Tenant and its Affiliates will not undertake, fail to undertake
or permit any acts or omissions which will in any way increase the cost of,
violate, void or make voidable all or any portion of any insurance policies
maintained by Landlord, unless Landlord gives its specific written consent
and Tenant pays all increased costs directly to Landlord on demand.
9. MONTHLY PAYMENT OF TAXES, OPERATING COSTS AND INSURANCE PREMIUMS.
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At any time and from time to time, and subject to later change,
Landlord may elect to have Tenant pay Tenant's share of Taxes, Operating Costs
and Landlord's insurance premiums (or any of them) in monthly installments, in
advance on the first of each month, based on amounts estimated by Landlord (as
revised from time to time). If these estimated monthly
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payments are required, after the end of each tax fiscal year, Lease Year or
other relevant periods selected by Landlord, Landlord will deliver to Tenant a
statement of the actual amounts due for the period. Any additional amounts due
from Tenant will be payable as additional rent within fifteen (15) days after
receipt of Landlord's statement, and any overpayment by Tenant will be refunded
by Landlord or deducted from the next monthly installments due for that
particular payment category. Quarterly, or less frequently, Landlord may
deliver a bill to Tenant for Tenant's share of Taxes, Operating Costs or
insurance premiums, and Tenant will pay the amount due to Landlord as additional
rent within fifteen (15) days (ten (10) days for Taxes) after receipt of
Landlord's bill. Tenant will receive a credit for any estimated monthly
payments already paid by Tenant for the period covered by that bill.
10. UTILITIES.
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Landlord will be solely responsible for bringing utility services to
the Premises to the extent now existing and/or as provided as part of Landlord's
Work in Exhibit "C". Tenant will pay when due to the furnishing parties all
fees and costs for utility services, and meters and equipment (to the extent not
supplied as part of Landlord's Work), furnished to the Premises, including,
without limitation, telephone, electricity, sewer, water and gas (if furnished).
If utilities and services for the Premises are not separately metered or
charged, Tenant will pay its share (as reasonably determined by Landlord) of
such costs directly to Landlord as additional rent, either monthly when base
rent is due, or within fifteen (15) days after receipt of Landlord's bill, at
Landlord's option. Landlord is not responsible for any Liabilities incurred by
Tenant or Tenant's Affiliates nor may Tenant abate rent, terminate this Lease or
pursue any other right or remedy against Landlord or Landlord's Affiliates, as a
result of any termination or malfunction of any utilities or utility systems.
11. USE OF PREMISES.
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Tenant will use the Premises for the purposes described in Section 1.1(h),
but for no other purpose. Tenant will:
(a) Operate its business in an attractive and first class manner.
Tenant will not permit any objectionable or unreasonable noises,
vibrations, odors or fumes in or to emanate from the Premises, nor commit
or permit any waste, improper, immoral or offensive use of the Premises,
any public or private nuisance or anything that disturbs the quiet
enjoyment of the other tenants, licensees, occupants or customers of the
Project. All deliveries and pickups must be conducted at times and in the
manner reasonably prescribed by Landlord. All trash and waste products must
be stored, discharged, processed and removed in the manner prescribed by
Landlord, and so as not to be visible to be other tenants or create any
health or fire hazard.
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(b) Install only window coverings and treatments approved by Landlord
and, once installed, keep them sufficiently closed to be shield from
outside view and machinery or other equipment that Landlord determines is
unsightly or inconsistent with that portion of the Project. Tenant will
vent only through louvres in the windows of the Premises, but Tenant may
not detach those louvres.
(c) Not permit any coin or token operated vending, video, pinball,
gaming or other mechanical devices on the Premises, except solely for use
by Tenant's employees; conduct retail sales to be walk-in customers (other
than occasional sales); permit governmental or quasi-governmental agencies
to occupy the Premises; use the Premises as doctors' offices, a school or
educational institution (but training for customers and/or Tenant's
personnel in the sue of Tenant's software will to be permitted), living or
sleeping quarters; store, sell or distribute obscene, lewd or pornographic
materials or engage in related businesses in or from the Premises; or
conduct any auction, distress, fire, bankruptcy or going-out-of-business
sale.
(d) Comply with: Laws and insurance requirements affecting the
Premises, the Project or any use and occupancy thereof by Tenant or its
Affiliates (including, without limitation, making required improvements to
the Premises); and Landlord's rules and regulations from time to time.
Tenant will, at its expense, obtain and maintain all licenses, approvals
and variances necessary to conduct its business and occupy the Premises,
but none of those licenses, permits or variances will be binding on or in
any way affect or restrict Landlord, any other tenants in the Project or
the Project itself.
(e) If its wishes, install signs or lettering on the entry doors to
the Premises and on a monument sign to be specified by Landlord identifying
its tenancy in the manner customary to be first-class office buildings.
Tenant will conform to be standards established by Landlord from time to
time for the above signs and lettering and submit for Landlord's prior
approval a plan or sketch of the Tenant's proposed signs or lettering, and
provided that Tenant's signs and lettering so conform, Landlord's consent
will not be unreasonably withheld. All other sings, lettering, awnings,
canopies or other decorations require Landlord's prior approval.
(f) Not use any advertising or other media or other device which can
be heard or experienced outside the Premises (except as permitted in
subparagraph (e) above), including without limitation, lights or audio or
visual devices. Tenant will not distribute handbills or advertising,
promotional or other materials anywhere in the Project or solicit business
in the Project other than within its own Premises.
12. MAINTENANCE AND REPAIRS.
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12.1 Landlord's Obligations. Landlord will repair and maintain the
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roof and the structural portions of the floor and load-bearing walls of the
Premises (but not the interior surfaces), the plumbing Systems and Equipment up
to and including the main vertical risers, the sanitary sewer and chilled water
lines outside of the footprint of the Premises, and the electrical Systems and
Equipment up to the buss duct tap. Landlord also will manage the cleaning,
landscaping and snowplowing of the Common Areas. However, Tenant will be
responsible for all repairs and maintenance resulting from Tenant's Alterations
or the negligent or intentional acts or omissions of Tenant or its Affiliates.
Landlord will make its repairs within a reasonable time following Tenant's
notification that the repairs are required. Landlord's obligations are subject
to the provisions of Articles 16 and 17 and the rest of this Lease.
12.2 Tenant's Obligations. Except for Landlord's obligations in
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Section 12.1 and as set forth immediately below, Tenant will maintain and repair
the Premises and the Systems and Equipment serving the Premises in a first-class
manner (including replacement thereof if an when necessary), and keep the
Premises in good order and condition, including, without limitation, Tenant's
Property, all doors, windows, window treatments, wall coverings, floor
coverings, non-structural portions of the ceiling, floor and walls, and Tenant's
Alternations (unless otherwise required by Landlord). If Tenant claims that any
Systems and Equipment that it is obligated to be maintain, repair or replace as
described above are not in good working order and condition consistent with
their age, it must notify Landlord in writing within two (2) months after the
date of this Lease specifically describing the items and the reasons for its
claim. If in fact those Systems and Equipment specified in Tenants notice are
not in good working order and condition consistent with their age, Landlord will
make such repairs as are necessary to put them in such condition, and only
thereafter will Tenant be obligated to maintain, repair or replace those Systems
and Equipment as set forth above. However, if Tenant fails to so notify Landlord
or if Tenant occupies or accepts the Premises, all Systems and Equipment
irrevocably will be deemed to be in good working order and condition consistent
with their age. Subject to Landlord's prior consent, which will not be
unreasonably withheld, Tenant may select a cleaning company of its choice to
clean the Premises at Tenant's sole cost.
13. ALTERATIONS.
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13.1 Landlord's Consent. "Alterations" means Tenant's alterations,
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additions, improvements, remodeling, repainting, or other changes. Tenant may
make nonstructural Alterations to the interior of the Premises without
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Landlord's consent as long as the Alterations do not: affect the windows, the
exterior of the Building, or any portion of the Building or the rest of the
Project outside of the Premises; affect the strength, structural integrity or
load-bearing capacity of any portion of the Building; affect the Systems and
Equipment in the Premises or the rest of the Building or increase Tenant's
usage; or, in Landlord's reasonable judgment, cost more than a total of Sixty
Thousand and No/100 Dollars ($60,000.00) in any Lease Year when combined with
the cost of other Alterations made in that
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Lease Year. All other Alterations require Landlord's prior written consent.
Whether or not Landlord's consent is required, Alterations are subject to be the
rest of this Article.
13.2 Notice. Tenant will notify Landlord not less than fifteen (15)
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days before beginning any Alterations (but no notice will be required for
moveable, unattached partitions and work stations). Together with Tenant's
notice, Tenant will give Landlord copies of the necessary permits and approvals
and, if Landlord deems it necessary, plans and specifications for the
Alterations (but not for minor, non-structural Alterations such as wall
coverings, built-in cabinetry, and painting). Landlord's review or approval of
Tenant's plans and specifications is solely for Landlord's benefit and will not
be considered a representation or warranty to Tenant as to safety, adequacy,
efficiency, compliance with Laws or any other matter, or a waiver of any of
Tenant's obligations. Except for items of Tenant's Property, all Alterations
will be deemed Landlord's property and part of the realty, and will be
surrendered with the Premises at the end of this Lease, unless otherwise
requested by Landlord.
13.3 Compliance with Laws. Alterations will comply in all respects
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with this Lease and applicable Laws and insurance requirements. Alterations
will be done in a first-class manner, using first quality materials, and so as
not to interfere in any way with Landlord or any other tenant in the Project,
cause labor disputes, disharmony or delay, or impose any Liabilities on
Landlord. Alterations will be performed only by experienced, licensed and
bonded contractors and subcontractors approved in writing by Landlord, which
approval will not be unreasonably withheld. At Landlord's request, Tenant will
cause its contractors and subcontractors to carry workmen's compensation
insurance.
13.4 Liens. Tenant will pay when due all claims for labor, materials
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and services claimed to be furnished for Tenant or Tenant's Affiliates or for
their benefit and keep the Premises and the Project free from all liens,
security interests and encumbrances ("Liens"). Tenant will indemnify Landlord
for, and hold Landlord harmless from, all Liens, the removal of all Liens and
any related actions or proceedings, and all Liabilities incurred by Landlord in
connection therewith. NOTICE IS HEREBY GIVEN TO ALL PERSONS FURNISHING LABOR OR
MATERIALS TO TENANT THAT NO MECHANICS', MATERIALMEN' OR OTHER LIENS SOUGHT ON
THE PREMISES WILL IN ANY MANNER AFFECT LANDLORD'S RIGHT, TITLE OR INTEREST.
13.5 Satellite Dish. Subject to the following and the rest of this
--------------
Article and this Lease, Tenant may install a satellite dish no larger than three
feet (3') in diameter in a location specified by Landlord. Tenant will be
responsible for all Liabilities in connection with this satellite dish and
associated equipment, including, without limitation, installation, removal,
operating, maintenance, insurance, taxes and other costs and fees. Tenant also
will be solely responsible for securing all federal, state and local permits in
connection with the installation and operating of this satellite dish prior to
its installation. If this satellite dish is on a roof, Tenant will secure from
the membrane roofing manufacturer certification that the installation of this
satellite dish is compatible with all design requirements and that this
installation will
-11-
not void the existing roof warranty. This certification must be delivered to
Landlord before installation begins. Tenant also will use only a manufacturer-
authorized roofing contractor for any work that requires the penetration of the
existing membrane roofing system. Upon the expiration or earlier termination of
this Lease, Tenant, at its expense, will remove the satellite dish and all
associated equipment and repair all damage. Notwithstanding anything to the
contrary, Landlord will have no Liabilities in connection with this satellite
dish and associated equipment, and Tenant will indemnify Landlord for and hold
it free and harmless from all Liabilities arising out of or in connection with
this satellite dish.
14. INDEMNITY; SATISFACTION OF REMEDIES.
------------------------------------
14.1 Indemnification. In addition to any other indemnities in this
---------------
Lease, Tenant will indemnify Landlord for and hold Landlord harmless from
Liabilities arising from or in connection with: acts or omissions of Tenant or
its Affiliates or the conduct of Tenant's business; Tenant's breach of or
default under this Lease; and claims by Tenant's Affiliates or other persons if
Landlord declines to consent to any act, event or document requiring Landlord's
consent under this Lease.
14.2 Damage to Persons or Property. Subject to the rest of this Section
-----------------------------
and the rest of this Lease, Landlord will be liable for damages solely
to the extent caused by its own negligence or willful misconduct in breach of
this Lease, but Landlord will not be liable for any special, indirect,
consequential, punitive or similar damages (including, without limitation, any
loss of use or revenue by Tenant or any other person) under any circumstances,
or for any Liabilities arising from or in connection with: acts or omissions of
Tenant, any other tenants of the Project, any third parties, or their
Affiliates, including, without limitation, burglary, vandalism, theft, or
criminal or illegal activity; explosion, fire, steam, electricity, water, gas,
rain, pollution, contamination, hazardous substances, motor vehicles or any
casualties; breakage, leakage, malfunction, obstruction or other defects in
Systems and Equipment, or of any services or utilities; any work, demolition,
maintenance or repairs permitted under this Lease; and exercise of Landlord's
rights under any Laws or under this Lease, including any entry by Landlord or
its Affiliates on the Premises in accordance with this Lease; or any of the
matters described in Section 24.5. Tenant and Tenant's Affiliates assume the
risk of all of these Liabilities and waive all claims against Landlord in
connection therewith. Tenant also waives any Laws or rights that would permit
Tenant to terminate this Lease, perform repairs or maintenance in lieu of
Landlord (or on Landlord's behalf), or offset or withhold any amounts due
because of damage to or destruction of the Premises, any repairs or maintenance,
or for any other reason. Tenant immediately will notify Landlord of any damage
or injury to persons or property and any event which could be anticipated to
give rise to any of the foregoing Liabilities. This exculpation of Landlord and
all of Tenant's waivers in this Lease will apply to all of Tenant's Affiliates
to the greatest extent possible. This Section 14.2 is not meant to reduce the
extent of Landlord's obligations to repair or rebuild in any particular
circumstances as may be required in Section 12.1 and Articles 16 and 17.
-12-
14.3 Satisfaction of Remedies. Notwithstanding anything in this
------------------------
Lease or elsewhere to he contrary: Tenant and its Affiliates will look solely
to Landlord's interest in the Project to satisfy any claims, rights or remedies,
and Landlord and its Affiliates, at every level of ownership and interest, have
no personal or individual liability of any type, whether for breach of this
Lease or otherwise, their assets will not be subject to lien or levy of any
type, nor will they be named individually in any suits, actions or proceedings
of any type.
15. COMMON AREA AND PARKING.
-----------------------
15.1 Common Area. "Common Area" means all areas and improvements
-----------
within the Project, as it now exists or as it exists in the future, not held or
designated for the exclusive use or occupancy of Landlord, Tenant, or other
tenants or prospective tenants. Tenant may use the Common Area on a
nonexclusive basis during this Lease. Landlord reserves all rights in
connection with the Common Area, including, without limitation, the right to
change, relocate, improve or demolish portions, promulgate rules and regulations
for its use, limit the use of any portion of the Common Area by Tenant or its
Affiliates, and place certain portions of the Common Area off limits to Tenant
and its Affiliates, including, without limitation, janitorial, maintenance,
equipment and storage areas, and entrances, loading docks, corridors, elevators
and parking areas. Except during emergencies or necessary maintenance, repair
or construction, Landlord's exercise of these rights will not ever prevent
Tenant from having access to the Premises and a loading dock or from having at
least one (1) main entrance to the Premises on High Street, but will not require
Landlord to compensate Tenant in any way, result in any Liabilities to Landlord,
entitle Tenant to abate rent, or reduce Tenant's Lease obligations.
15.2 Parking. Tenant may park two hundred five (205) passenger cars
-------
in the areas designated by Landlord from time to time for Tenant's parking
(Tenant's current areas are shown in Exhibit "A"). If Tenant does not use all
of its parking spaces, Landlord may allow others to use those spaces at no
charge, subject to Tenant's right to reclaim those spaces when needed. As
permitted by Section 15.1, Landlord may: limit access to portions of the
parking areas; change signs, lanes and the direction of traffic within the
parking areas; change, eliminate or add parking spaces or areas devoted to
parking; allow free parking or parking with a validation, valet, sticker or
other system; promulgate rules and regulations; and take any other actions
deemed necessary by Landlord.
16. DAMAGE OR DESTRUCTION.
---------------------
16.1 Repairs. Subject to the rest of this Article and the rest of
-------
this Lease, Landlord will repair damage to the Premises caused by casualties
insured against under standard "all risk" casualty policies. However, Landlord
is not obligated to repair damage for which Tenant or its Affiliates are
responsible or for which Landlord has no liability under other provisions of
this Lease. Except as may otherwise be required by then applicable Laws,
Landlord will attempt to restore the damaged portions to their prior condition,
but Landlord is
-13-
not required to undertake repairs unless insurance proceeds are available, spend
more than the net insurance proceeds it actually receives and is permitted to
retain for any repair or replacement, or repair or replace any damage to
Tenant's Work, Tenant's Property or any Alterations. Landlord will begin
repairs within a reasonable time after receiving notice of the damage, required
building permits or licenses and the insurance proceeds payable on account of
the damage.
16.2 Election to Terminate. Landlord has the option either to repair
---------------------
the casualty damage, or terminate this Lease by delivering written notice within
sixty (60) days after the damage occurs, if: the damage occurs during the last
year of the term; or Tenant is in default; or the repairs would take more than
one hundred twenty (120) days to complete or cost more than thirty-five percent
(35%) of the cost of Landlord's Work; or the damage was caused primarily by the
intentional act or omission of Tenant or its Affiliates; or more than twenty-
five percent (25%) of the leasable space in the rest of the Building is damaged.
16.3 Abatement of Rent. If the Premises are damages so as to be
-----------------
untenantable for more than five (5) consecutive business days and Landlord is
required or elects to repair the damage, base rent and Tenant's share of Taxes
and Landlord's insurance premiums will abate until Landlord has substantially
completed the repairs and given Tenant access to the Premises, or Tenant
reoccupies part of the Premises, whichever is earlier. If Tenant continues to
occupy or reoccupies the Premises before substantial completion of these repairs
but cannot occupy substantially all of the Premises became of these ongoing
repairs, base rent and Tenant's share of Taxes and Landlord's insurance premiums
will abate in proportion to the degree to which Tenant's use of the Premises is
impaired, as reasonably determined by Landlord. Base rent and Tenant's share of
Taxes and Landlord's insurance premiums will not be abated if the acts or
omissions of Tenant or its Affiliates render Landlord unable to collect the
rental loss insurance proceeds that otherwise would have been payable to
Landlord. The abatement of base rent and Tenant's share of Taxes and Landlord's
insurance premiums described above is Tenant's sole remedy against and
compensation from Landlord in connection with any damage, destruction or
repairs.
17. CONDEMNATION.
------------
If all or substantially all of the Premises are condemned, taken or
appropriated by any public or quasi-public authority under the power of eminent
domain, police power of otherwise, or if there is a sale in lieu thereof
("Condemned"), this Lease will terminate when title or possession is taken by
the condemning authority or its designee. If:
(a) More than twenty-five percent (25%) of the usable areas of the
Premises is Condemned, either Landlord or Tenant may terminate this Lease
by delivering written notice to the other within fifteen (15) days
thereafter. Landlord also may terminate this Lease as provided above if
more than twenty-five percent (25%) of any of the leasable area of the
rest of the Building is condemned.
-14-
(b) Part of the Premises is Condemned and this Lease is not
terminated, Landlord will make the necessary repairs so that, to the extent
reasonably possible, the remaining part of the Premises will be a complete
architectural unit. Otherwise, Landlord's restoration will be conducted as
described in Section 16.1, except that Landlord will not be required to
begin repairs until a reasonable time after it receives any necessary
building permits and substantially all of the proceeds of any awards
granted for the Condemnation. After the date title or possession is taken
by the condemning authority or its designees, base rent and Tenant's share
of Taxes and Landlord's insurance premiums will abate in proportion to the
area of the Premises Condemned.
All proceeds, income, rent, awards and interest in connection with any
Condemnation will belong to Landlord, whether awarded as compensation for
diminution of value to the leasehold improvements, or the unexpired portion of
this Lease, or otherwise. Tenant waives all claims against Landlord and the
condemning authority with respect thereto, but nothing in this Section prevents
tenant from bringing a separate action against the condemning authority for
moving costs or for lost goodwill (as long as this separate action does not
diminish Landlord's recovery).
18. ASSIGNMENT AND SUBLETTING.
-------------------------
18.1 Landlord's Consent Required. Tenant will not voluntarily,
---------------------------
involuntarily or by operation of any laws sell, convey, mortgage, subject to a
security interest, license, assign, sublet or otherwise transfer or encumber all
or any part of Tenant's interest in this Lease or the Premises, or allow anyone
other than Tenant's employees to occupy the Premises (singularly or
collectively, "Transfer"), without Landlord's prior written consent in each
instance. Any attempt to do so without this consent will be null and void and a
default.
18.2 Notice. Tenant will notify Landlord in writing at least forty-
------
five (45) days before any proposed or pending Transfer and will deliver to
Landlord such information as Landlord may reasonably request in connection with
the proposed or pending Transfer and the proposed Transferee, including, without
limitation, a copy of the proposed Transfer documents, financial statements and
other financial information about and banking references for the proposed
Transferee, and information as to the type of business and business experience
of the proposed Transferee. All of this information must be suitably
authenticated.
18.3 Landlord's Right to Terminate. If Tenant notifies Landlord of a
-----------------------------
Transfer, or if Landlord becomes aware of a Transfer, Landlord may: consent;
withhold consent (subject to 18.4 below); or terminate this Lease on written
notice to Tenant if the Transfer is an assignment of the Lease or a sublease of
all or substantially all of the Premises. If Tenant proposes a sublease for a
term longer than one year that, together with any other subleases, totals more
than 16,000 square feet of rentable area, Landlord may terminate the Lease as to
-15-
the portion of the Premises proposed to be sublet. If Landlord elects to
terminate, this Lease (or this Lease as applicable to the portion to be sublet
as described above) will terminate on the date set forth in Landlord's
termination notice. Nothing in this Section limits Landlord's rights or
remedies if Tenant is in default or if the Transfer does not comply with this
Article.
18.4 Reasonable Consent. If Landlord does not elect (assuming it is
------------------
permitted) to terminate this Lease, and if the request for Transfer is given
after the end of the first (1st) Lease Year, Landlord will not unreasonably
withhold its consent to an assignment or subletting. (For purposes of this
Section, an assignment for security purposes and other Transfers will continue
to be governed by Section 18.1). Tenant agrees that the withholding of
Landlord's consent will be deemed reasonable if Tenant has breached this Lease
or failed to comply with the rest of this Article, or if any of the following
conditions are not satisfied:
(a) The proposed assignee or subtenant will use the Premises strictly
in accordance with the terms of this Lease and the business of the proposed
assignee or subtenant is consistent with the other uses and the standards
of the Project, in Landlord's reasonable judgment.
(b) The proposes assignee or subtenant is reputable, has a credit
rating reasonably acceptable to Landlord, and otherwise has sufficient
independent financial capabilities to perform all of its obligations under
this Lease or the proposed sublease, in Landlord's reasonable judgment.
(c) Neither the proposed assignee or subtenant nor its Affiliates is
or has been a tenant or occupant or has negotiated for space in the Project
or in other projects in Massachusetts owned by Landlord or a partnership or
corporation affiliated with Landlord or Niuna-North Andover, Inc. (current
projects are located in Cambridge, Andover, Wakefield and West Newton)
within the six (6) month period before the delivery of Tenant's written
notice. This Subsection (c) will apply while North Andover Mills Realty or
an affiliated entity owns the Premises.
(d) Landlord's Mortgagees consent to the assignment or subletting, and
a proposed sublease will not result in more than three entities or
businesses occupying the Premises.
These conditions are not exclusive and Landlord may consider other factors in
determining if it should grant or reasonably withhold its consent.
18.5 (INTENTIONALLY OMITTED)
18.6 No Release of Tenant. Whether or not Landlord consents, no
--------------------
Transfer will release or alter the primary liability of Tenant to pay rent and
perform all of Tenant's other obligations under this Lease. The acceptance of
rent by Landlord from any person other than
-16-
Tenant is not a waiver by Landlord. Consent to one Transfer will not be deemed
to be consent to any subsequent Transfer. If any Transferee defaults under this
Lease, Landlord may proceed directly against the Transferee and/or against
Tenant without proceeding or exhausting its remedies against the other. After
any Transfer, Landlord may consent to subsequent Transfers of or amendments to
this Lease without notifying Tenant or any other person, without obtaining
consent thereto, and without relieving Tenant of liability under this Lease (as
it may be modified), except that Tenant's aggregate monetary liability under
this Lease, as it may be modified, will not be greater than it would have been
under this Lease without the modification.
18.7 Additional Terms. Tenant will pay Landlord's attorneys' fees
----------------
and other costs in connection with any request for Landlord's consent to a
Transfer. To be effective all assignments and subleases must always prohibit
any further assignment, subleasing or other Transfer and state that they area
subject and subordinate to the terms of this Lease. While North Andover Mills
Realty or an affiliated entity owns the Project, Tenant and its Affiliates will
not, directly or indirectly, take an assignment or sublease from, or otherwise
occupy premises leased to, any existing or future tenants (or their assignees,
sublessee or successors) of space in the Project or in other projects in
Massachusetts owned by Landlord or a partnership or corporation affiliated with
Landlord or with Niuna-North Andover, Inc. (current projects are located in
Cambridge, Wakefield, Andover, and West Newton). The surrender of this Lease or
its termination will not be a merger, but Landlord will have the right to
terminate all subleases and the occupancy rights of all Transferees. Tenant
will pay to Landlord as additional rent: fifty percent (50%) of all
consideration paid or payable for or by reason of any assignment of this Lease;
and, in the case of a sublease, fifty percent (50%) of the amount by which the
sublease rent and other consideration paid or payable (less the sublessee's pro
rata payment of real estate taxes and insurance, to the extent paid or payable)
exceeds the base rent for the sublease term (pro rated for the square footage
subleased). At Landlord's option, Landlord may collect all or any part of this
additional rent directly from the payor, and consideration paid or payable will
be defined in its broadest sense.
19. MORTGAGEE PROTECTION.
--------------------
19.1 Subordination and Attornment. This lease is subordinate to all
----------------------------
Superior Leases and Mortgages (defined in Section 24.4), and Tenant will attorn
to each person or entity that succeeds to Landlord's interest under this Lease.
This Section is self-operative, but if requests to confirm a subordination
and/or attornment, Tenant will execute subordination and attornment agreements
furnished by Landlord or Landlord's lessor or mortgagee under any of the
Superior Leases and Mortgages (a "Landlord's Mortgagee") within ten (10) days
after request. However, if Landlord or Landlord's Mortgagee elects in writing,
this Lease will be superior to the Superior Leases and Mortgages specified,
regardless of the date of recording, and Tenant will execute an agreement
confirming this election on request.
-17-
19.2 Mortgagee's Liability. The obligations and Liabilities of
---------------------
Landlord, Landlord's Mortgagees or their successors under this Lease will exist
only if and for so long as each of these respective parties owns fee title to
the Project or is the Lessee under a ground lease of the Project. Tenant will
be liable to Landlord's Mortgagees or their successors if any of those parties
become the owner of the Project for any base rent paid more than thirty (30)
days in advance. Landlord's Mortgagees and their successors will not be liable
for: (a) acts or omissions or prior owners; (b) the return of any security
deposit not delivered or credited to them (and Landlord agrees to deliver or
credit Tenant's unapplied security deposit to Landlord's Mortgagees if they
succeed to Landlord's interest under this Lease); or (c) amendments to this
Lease made without their consent (if their consent is requested under Superior
Lease or Mortgage).
19.3 Mortgagee's Right to Cure. No act or omission (if any) which
-------------------------
otherwise entitles Tenant under the terms of this Lease to be released from any
Lease obligations or to terminate this Lease will result in such a release or
termination unless Tenant first gives written notice of the act or omission to
Landlord and Landlord's Mortgagees and those parties then fail to correct or
cure the act or omission within ninety (90) days thereafter. Nothing in this
Section or the rest of this Lease obligates Landlord's Mortgagees to correct or
cure any act or omission or is meant to imply that Tenant has the right to
terminate this Lease or be released from its obligations unless that right is
explicitly granted elsewhere in this Lease.
20. ESTOPPEL CERTIFICATES.
---------------------
Tenant will from time to time, within fifteen (15) days after request
by Landlord, execute and deliver an estoppel certificate in form satisfactory to
Landlord or its designees which will certify (except as may be noted) such
information concerning this Lease or Tenant or It's Affiliates as Landlord or
its designees may request. If Tenant fails to execute and deliver estoppel
certificates as required, Landlord's representations concerning the matters
covered by the estoppel certificate will conclusively be presumed to be correct
and binding on Tenant and its Affiliates.
21. DEFAULT.
-------
The occurrence of one or more of the following events will be a
default by Tenant under this Lease: (a) the vacating or abandoning of the
Premises; (b) the failure to pay rent or any other required amount within seven
(7) days after the payment is due: (c) as provided in Articles 2w3 and 25; (d) a
Transfer or attempted Transfer in violation of Article 18; (e) the failure to
maintain its required insurance policies; or (f) the failure to observe or
perform any other obligation, term or condition within the time period specified
in this Lease; if no time period is specified, it will be default if this
failure continues for fifteen (15) days after written notice from Landlord to
Tenant, but if more than fifteen (15) days are reasonably required to cure,
Tenant will not be in default if Tenant begins to cure within the fifteen (15)-
day period
-18-
and then diligently completes the cure as soon as possible but within sixty (60)
days after the notice of default is given.
22. REMEDIES FOR DEFAULT.
--------------------
22.1 General. If Tenant defaults, Landlord may at any time
-------
thereafter, with or without notice or demand, do any or all of the following:
(a) give Tenant written notice stating that the Lease is terminated, effective
on the giving of notice or on a date stated in the notice, as Landlord may
elect, in which event this Lease will terminate without further action; (b) with
or without process of law or notice, and with or without terminating this Lease,
terminate Tenant's right of possession and enter and repossess the Premises
either by force or otherwise, and expel Tenant and Tenant's Affiliates, and
remove their property and effects, without being guilty of trespass; and
(c) pursue any other right or remedy now or hereafter available to Landlord
under this Lease or at law or in equity.
22.2 Tenant's Obligations. If any default, termination, reentry or
--------------------
dispossess occurs:
(a) All rent provided for in this Lease will become due and will be
paid to the time of the default, termination, reentry or dispossess,
together with such costs as Landlord may incur for attorneys' fees and
costs, inspection, brokerage fees, putting the Premises in good order,
condition and repair and/or for preparing and improving the Premises for
re-letting.
(b) Landlord may, at its sole option, re-let all or any portion of the
Premises on terms satisfactory to Landlord in its sole discretion, either
in its own name or otherwise, for a term or terms which may, at Landlord's
option, be more or less than the balance of the term of this Lease and
pursuant to one or more Leases, and Landlord may grant concessions, tenant
allowances and/or free rent, among other things.
(c) Subject to Section 22.2(e), whether or not the Premises are re-
let, Tenant will pay punctually to Landlord all of the rent and other sums
and perform all of Tenant's obligations for the entire Lease term (assuming
the original expiration date and any exercised options) in the same manner
and at the time as if this Lease had not been terminated.
(d) If Landlord re-lets the Premises, Tenant will be entitled to a
credit in the net amount of the rent actually received by Landlord from the
re-letting, after deducting all expenses described in Section 22.2(a) and
22.2(f) and the costs of collecting the rent. Rent received by Landlord
after re-letting first will be applied against Landlord's expenses as
described above until those expenses are recovered. Until recovery of those
expenses, Tenant will pay as and when due all amounts it is required to pay
under this Lease. Tenant's obligations prior to any re-letting and recovery
of expenses will not be diminished even if the re-letting is for a rent
higher
-19-
than the rent hereunder. When and if these expenses have been completely
recovered, amounts collected by Landlord from the re-letting that have not
previously been applied will be credited against Tenant's obligations when
each payment would fall due under this Lease, and only the net amount
thereof will be payable by Tenant. Amounts received by Landlord from re-
letting for any period will be credited only against obligations of Tenant
allocable to that period, and not against Tenant's obligations accruing
before or after that period, nor will any credit be given to Tenant for any
period after the original expiration date of this Lease.
(e) At Landlord' option, in lieu of other damages, Landlord may, by
written notice to Tenant at any time after Tenant's default, elect to
recover, and Tenant will thereupon pay, as liquidated damages, an amount
equal to the excess, if any, of: (i) the total rent and other benefits
which would have accrued to Landlord under this Lease for the remainder of
the Lease term (assuming the original expiration date and any exercised
options) if the default had not occurred plus all of the expenses described
in Sections 22.2(a) and 22.2(f); less (ii) the value of the cash rental to
be paid to Landlord for any Lease or Leases of the Premises actually
executed by Landlord at the time Landlord exercises its option, subject to
Subsection (d) above.
(f) No action of Landlord in connection with any re-letting, or
failure to re-let or collect rent under such re-letting, will operate or be
construed to release or reduce Tenant's Liabilities hereunder. Without
limiting any of the foregoing provisions, and in addition to any other
amounts that Tenant is otherwise obligated to pay, Tenant agrees that
Landlord may recover from Tenant all costs and expenses, including
attorneys' fees and costs, incurred by Landlord in enforcing this Lease
from and after Tenant's default.
22.3 Redemption. Tenant waives any and all rights of redemption
----------
granted by or under any laws if Tenant is evicted or dispossessed for any cause,
or if Landlord obtains possession of the Premises by reason of the violation by
Tenant of any of the terms, covenants or conditions of this Lease, or otherwise.
22.4 Performance by Landlord. If Tenant defaults or fails to perform
-----------------------
any of its obligations under this Lease, Landlord, without waiving or curing the
default or failure, may, but will not be obligated to, perform Tenant's
obligations for the account and at the expense of Tenant. Notwithstanding
Section 21(i), in the case of an emergency or to prevent damage or injury or
protect health, safety or property, Landlord need not give any notice before
performing Tenant's obligations. Tenant will pay on demand all costs and
expenses incurred by Landlord in connection with Landlord's performance of
Tenant's obligations, and Tenant will indemnify Landlord for and hold Landlord
harmless from all Liabilities incurred by Landlord in connection therewith.
-20-
22.5 Post-Judgment Interest. The amount of any judgment obtained by
----------------------
Landlord against Tenant in any legal proceeding arising out of Tenant's default
under this Lease will bear interest until paid at the Wells Fargo Bank prime
rate plus two percent (2%), or the maximum rate permitted by law, whichever is
less. Notwithstanding anything to the contrary contained in any laws, with
respect to any damages that are certain or ascertainable by calculation,
interest will accrue from the day that the right to the damages vests in
Landlord, and in the case of any unliquidated claim, interest will accrue from
the day the claim arose.
23. (SEE EXHIBIT "F" - BANKRUPTCY AND INSOLVENCY)
24. GENERAL PROVISIONS.
------------------
24.1 Holding Over. Tenant will not hold over in the Premises after
------------
the end of the Lease term without the express prior written consent of Landlord.
Tenant will indemnify Landlord for, and hold Landlord harmless from, any and all
Liabilities arising out of or in connection with any holding over, including,
without limitation, any claims made by any succeeding tenant and any loss of
rent suffered by Landlord. If, despite this express agreement, any tenancy is
created by Tenant's holding over, except as specifically set forth in the next
sentence the tenancy will be a tenancy at will terminable immediately at
Landlord's sole option on written notice to Tenant, but otherwise subject to the
terms of this Lease, except that the most recent annual base rent will be
doubled. Nothing in this Article or elsewhere in this Lease permits Tenant to
hold over or in any way limits Landlord's other rights and remedies if Tenant
holds over.
24.2 Entry By Landlord. Landlord and its Affiliates at all times
-----------------
have the right to enter the Premises, and Landlord will retain (or be given by
Tenant) keys to unlock all the doors to or within the Premises, excluding doors
to Tenant's vaults and files. Landlord and its Affiliates will have the right
to use any means necessary to enter he Premises if Landlord believes there is an
emergency or that entry is necessary to prevent damage or injury or protect
health, safety or property. Such entry to the Premises and the exercise of
Landlord's rights will not, under any circumstances, be deemed to be a default,
a forcible or unlawful entry into or a detainer of the premises or any eviction
of Tenant from the Premises or any portion thereof, not will it subject Landlord
to any Liabilities or entitle Tenant to any compensation, abatement of rent or
other rights and remedies.
24.3 Brokers. Tenant represents and warrants that it has had no
-------
dealings with any agent, broker, finder or other person who is or might be
entitled to a commission or other fee from Landlord in connection with this or
any related transaction, except for Tenant's Broker.
24.4 Quiet Enjoyment. So long as Tenant pays all rent and performs
---------------
its other obligations as required, Tenant may quietly enjoy the Premises without
hindrance or molestation by Landlord or any person lawfully claiming through or
under Landlord, subject to the terms of this Lease and the terms of any Superior
Leases and Mortgages, and all other
-21-
agreements or matters of record or to which this Lease is subordinate. As used
in this Lease, the term "Superior Leases and Mortgages" means all present and
future ground leases, underlying leases, mortgages, deeds of trust or other
encumbrances, and all renewals, modifications, consolidations, replacements or
extensions thereof and advances made thereunder, affecting all or any portion of
the Premises or the Project.
24.5 Security. Tenant is solely responsible for providing security
--------
for the Premises and Tenant's personnel. Without limiting the generality of
this Article, Tenant agrees that: (a) Landlord may, but will not be required to,
supply security personnel and systems for the Premises, the Common Area or the
rest of the Project and remove or restrain unauthorized persons and prevent
unauthorized acts; (b) Landlord will incur no Liabilities for failing to provide
security personnel or systems or, if provided, for acts, omissions or
malfunctions of the security personnel or systems; and (c) Landlord and its
Affiliates make no representations or warranties of any kind in connection with
the security or safety of the Premises, the Common Area or the rest of the
Project.
24.6 Obligations; Successors; Recordation. If tenant consists of
------------------------------------
more than one person or entity, the obligations and liabilities or those persons
or entities are joint and several. Time is of the essence of this Lease.
Subject to the restrictions in Article 18, this Lease inures to the benefit of
and binds Landlord, Tenant and their respective Affiliates. Tenant will not
record this Lease but Tenant may record a memorandum of this Lease, in form
satisfactory to Landlord, to comply with the Massachusetts statutory notice
provisions. If this Lease expires or is terminated, this memorandum will be
deemed null and void and removed from title, and Tenant will execute and record
such documents as may be necessary to accomplish this at Landlord's request, and
if Tenant refuses to do so, Landlord may execute and record such documents in
Tenant's name or in its own name.
24.7 Late Charges. If any rent or other amounts payable by Tenant
------------
are not received within five (5) days after the due date, Tenant will pay to
Landlord on demand a late charge equal to five percent (5%) of the overdue
amount, and if not received within ten (10) days after the due date, the amounts
also will bear interest from the due date until paid at the interest rate in
Section 22.5. Collection of these late charges and interest will not: be a
waiver or cure of Tenant's default or failure to perform; be deemed to be
liquidated damages, an invalid penalty or an election of remedies; or prevent
Landlord from exercising any other rights and remedies.
24.8 Accord and Satisfaction. Payment by Tenant or acceptance by
-----------------------
Landlord of less than the full amount of rent due is not a waiver, but will be
deemed to be on account of amounts next due, and no endorsements or statements
on any check or any letter accompanying any check or payment will be deemed an
accord and satisfaction or binding on Landlord. Landlord may accept the check
or payment without prejudice to any of Landlord's rights and remedies,
including, without limitation, the right to recover the full amount due.
-22-
24.9 Prior Agreements; Amendments; Waiver. This Lease is an
------------------------------------
integrated document and contains all of the agreements of the parties with
respect to any matter covered or mentioned in this Lease, and supersedes all
prior agreements or understandings (including, without limitation, the Letter of
Intent between Landlord and Tenant, dated October 3, 1991, as extended, but
excluding Agency Agreements that have been or may be entered into between Tenant
and Landlord for other space leased by Tenant outside the Project). This Lease
may not be amended except by an agreement in writing signed by the parties. All
waivers must be in writing, specify the act or omission waived and be signed by
Landlord. No other alleged waivers will be effective, including, without
limitation, Landlord's acceptance of rent, collection of a late charge or
application of a security deposit. Landlord's waiver of any specific act,
omission, term or condition will not be a waiver of any other or subsequent act,
omission, term or condition.
24.10 Representations; Inability to Perform. Landlord and its
-------------------------------------
Affiliates have not made, and Tenant is not relying on, any representations or
warranties of any kind, express or implied, with respect to the Premises, the
Project or this transaction. Landlord will not be in default nor incur any
Liabilities if it cannot fulfill any of its obligations, or is delayed in doing
so, because of accidents, breakage, strike, labor troubles, war, sabotage,
governmental regulations or controls, inability to obtain materials or services,
acts of God, or any other cause, whether similar or dissimilar, beyond
Landlord's reasonable control.
24.11 Legal Proceedings. In any action or proceeding involving or
-----------------
relating in any way to this Lease, the court or other person or entity having
jurisdiction in such action or proceeding will award to the party in whose favor
judgement is entered the actual attorneys' fees and costs incurred. Tenant also
will indemnify Landlord for, and hold Landlord harmless from and against, all
Liabilities incurred by Landlord if Landlord becomes or is made a party to any
proceeding or action: (a) involving Tenant and any third party, or by or against
any person holding any interest under or using the Premises by License of or
agreement with Tenant (except and strictly to the extent that Landlord is
finally determined to be a joint tortfeasor with Tenant against such third
party); or (b) necessary to protect Landlord's interest under this Lease in a
proceeding under the Bankruptcy Code. Unless prohibited by law, Tenant waives
the right to trial by jury in all actions involving or related to this Lease,
the Project or any collateral or subsequent agreements between the parties, and
any right to impose a counterclaim in any proceeding brought for possession of
the Premises as a result of Tenant's default. Tenant also submits to and agrees
not to contest the sole and exclusive jurisdiction of the state and federal
courts located in Massachusetts to adjudicate all matters in connection with
this Lease or involving Landlord or Landlord's Affiliates in any way, and Tenant
agrees that it will bring all suits and actions only in such Massachusetts
courts and not to seek a change of venue. Service on any one or more of the
individuals comprising Tenant will conclusively be deemed service on all of
those individuals. In any circumstances where Tenant is obligated to indemnify
or hold harmless Landlord under this Lease, that obligation also will run in
favor of Landlord's Affiliates, and will include the obligation to protect
Landlord and its Affiliates, and defend them with counsel acceptable to
Landlord, and Tenant
-23-
will pay when due all attorneys' fees and costs. These obligations to
indemnify, hold harmless, protect and defend will survive the expiration or
termination of this Lease.
24.12 Ownership; Invalidity; Remedies; Choice of Law. As used in
----------------------------------------------
this Lease, the term "Landlord" means only the current owner or owners of the
fee title to the Premises. Upon each conveyance (whether voluntary or
involuntary) of fee title, the conveying party will be relieved of all
Liabilities and obligations contained in or derived from this Lease or arising
out of any act, occurrence or omission occurring after the date of such
conveyance. Landlord may Transfer all or any portion of its interests in this
Lease, the Premises, or the Project without affecting Tenant's obligations and
Liabilities under this Lease. Tenant has no right, title or interest in the
name of the Building or the Project, and may use these names only to identify
its location. Any provision of this Lease which is invalid, void or illegal
will not affect, impair or invalidate any of the other provisions and the other
provisions will remain in full force and effect. Landlord's rights and remedies
are cumulative and not exclusive. This Lease is governed by the laws of
Massachusetts applicable to transactions to be performed wholly therein.
24.13 Expense; Consent. Unless otherwise provided in this Lease, a
----------------
party's obligation will be performed at that party's sole cost and expense,
except when Landlord is performing Tenant's obligations because of Tenant's
default or failure to perform or as otherwise permitted in this Lease. Except
where it is expressly provided that Landlord will not unreasonably withhold its
consent or approval or exercise its judgment reasonably, Landlord may grant or
withhold its consent or approval and exercise its judgment arbitrarily and in
its sole and absolute discretion and without dispute by Tenant. In any dispute
involving Landlord's withholding of consent or exercise of judgment, the sole
right and remedy of Tenant and its Affiliates is declaratory relief (i.e., that
such consent should be granted where Landlord has agreed not to unreasonably
withhold its consent) pursuant to arbitration in Massachusetts conducted by the
American Arbitration Association utilizing its expedited arbitration procedures,
and Tenant and its Affiliates waive all other rights and remedies, including,
without limitation, claims for damages.
24.14 Presumptions; Exhibits; Submission; Net Lease. This Lease will
---------------------------------------------
be construed without regard to any presumption or other rule requiring
construction or interpretation against the party drafting the document. The
titles to the Articles and Sections of this Lease are not a part of this Lease
and will have no effect on its construction or interpretation. Whenever
required by the context of this Lease, the singular includes the plural and the
plural includes the singular, and the masculine, feminine and neuter genders of
each include the others, and the word "person" includes individuals,
corporations, partnerships or other entities. All exhibits and riders attached
to this Lease are incorporated in this Lease by this reference, and if there is
any conflict with the rest of this Lease, the riders will control. The
submission of this Lease to Tenant or its broker, agent or attorney for review
or signature is not an offer to Tenant to lease the Premises or the grant of an
option to lease to Premises. This Lease will not be binding unless and until it
is executed and delivered by both Landlord and Tenant. This
-24-
Lease is intended to be a completely "triple net" lease, unless specifically
otherwise provided in this Lease.
24.15 Cooperation. Tenant will, at its expense, cooperate with
-----------
Landlord in all respects in connection with this Lease, Landlord's ownership,
operation, management, improvement, maintenance and repair of the Premises and
the rest of the Project, and Landlord's exercise of its rights and obligations
under this Lease. If necessary, this cooperation will include, without
limitation, moving machinery and equipment within the Premises and allowing
Landlord sufficient space within the Premises to enable Landlord to perform any
work that Landlord has the right or is required to perform under this Lease.
24.16 Notices. All notices, demands or communications required or
-------
permitted under this Lease (the "Notices") will be in writing and personally or
electronically delivered, or sent by certified mail, return receipt requested,
postage prepaid. Notices to Tenant will be delivered to the address for Tenant
in Section 1.1, except that when Tenant takes possession of the Premises, the
address of the Premises always may be used for the purpose of delivering notices
to Tenant. Notices to any one or more of the individuals comprising Tenant will
be deemed Notices to all of those individuals. Notices to Landlord will be
delivered to the addresses for Landlord in Section 1.1. Notices will be
effective on the earlier of: delivery; or, if mailed, three (3) days after they
are mailed in accordance with this Section.
24.17 Security Deposit. On the execution of this Lease, Tenant will
----------------
deposit the Security Deposit with Landlord as security for the performance of
Tenant's obligations. If Tenant fails to perform its Lease obligations as
required, Landlord may, but will not be obligated to, apply all or any part of
the Security Deposit for the payment of any amounts due or any other Liabilities
which Landlord may incur. If any part of the Security Deposit is so applied,
Tenant will, within five (5) days after written demand, deposit cash with
Landlord in an amount sufficient to restore the Security Deposit to its previous
amount. Landlord need not keep the Security Deposit separate from its general
funds, and Tenant will receive interest on the unapplied Security Deposit at the
rate of five percent (5%) per annum, payable at the end of each Lease Year. If
Tenant complies with all of the provisions of this Lease, the unused portion of
the Security Deposit will be returned to Tenant after the end of this Lease and
the surrender of possession of the Premises to Landlord in the condition
required.
24.18 Other Defined Terms.
-------------------
(a) "Affiliates" means: partners, directors, officers, shareholders,
agents, employees, parents, subsidiaries, affiliated parties, invitees,
customers, licensees, concessionaires, contractors, subcontractors,
successors, assigns, subtenants, and representatives. However, where Tenant
under this Lease releases Landlord's Affiliates from Liabilities, Tenant
will not be deemed to have released Landlord's contractors and
subcontractors if such parties are completely independent from Landlord and
otherwise are not Affiliates of Landlord.
-25-
(b) "Laws" means: laws, codes, decisions, ordinances, rules,
regulations, licenses, permits, and directives of governmental and quasi-
governmental officers, including, without limitation, those relating to
building and safety, fire prevention, health, energy conservation,
Hazardous Substances and environmental protection.
(c) "Liabilities" means: all costs, damages, claims, injuries,
liabilities and judgements, including, without limitation, attorneys' fees
and costs (whether or not suit is commenced or judgment entered).
(d) "Systems and Equipment" means: all HVAC, plumbing, mechanical,
electrical, lighting, water, gas, sewer, safety, sanitary and any other
utility or service facilities, systems and equipment, and all pipes, ducts,
poles, stacks, chases, conduits and wires.
25. HAZARDOUS SUBSTANCES.
--------------------
Without limiting the generality of any portion of this Lease, Tenant and
its Affiliates will:
(a) Not store, handle, transport, use, process, generate, discharge
or dispose of any hazardous, toxic, corrosive, dangerous, explosive,
flammable or noxious substances, gasses or waste, whether now or hereafter
defined under any Laws or otherwise (collectively, "hazardous substances"),
from, in or about the Premises or the rest of the Project, or create any
release or threat of release of any hazardous substances, nor permit any of
the foregoing to occur. If any of the foregoing occur, or if Landlord in
good faith believes that any of the foregoing have occurred or are likely
to occur or that Tenant and its Affiliates are not complying fully with the
requirements of this Article, in addition to any other rights and remedies
of Landlord, Tenant and its Affiliates immediately will cease the acts or
omissions and in addition to any other rights and remedies (all of which
are cumulative), at Landlord's request Tenant will take such actions as may
be required by Laws and as Landlord may direct to cure or prevent the
problem. Tenant and its Affiliates will comply fully with all Laws and
insurance requirements in connection with or related to hazardous
substances, whether now or hereafter existing, including, without
limitation, CERCLA, SARA, RCRA, TSCA, CWA, Chapter 21E of Massachusetts
General Laws and any other Laws promulgated by the EPA, OSHA or
Commonwealth of Massachusetts.
(b) Immediately pay, and indemnify Landlord for and hold Landlord
harmless from, all Liabilities in connection with or arising directly or
indirectly from hazardous substances or any breach by Tenant or its
Affiliates of their obligations in this Article, including, without
limitation, the costs of any of the following, whether required by
Landlord, applicable Laws or insurance requirements or otherwise: any
-26-
"response actions" or "responses"; any surveys, "audits", inspections,
tests, reports or procedures deemed necessary or desirable by Landlord or
governmental or quasi-governmental authorities to determine the existence
or scope of any hazardous substances or Tenant's compliance with this
Article, and any actions recommended to be taken in connection therewith;
compliance with any applicable Laws and insurance requirements; any
requirements, directives or plans for the prevention, containment,
processing, storage, clean-up or disposal of hazardous substances; the
release and discharge of any resulting liens; and any other injury or
damage. On the expiration or earlier termination of this Lease, Tenant will
leave the Premises free of hazardous substances.
(c) Immediately deliver to Landlord copies of any notices,
information, reports and communications of any type received or given in
connection with hazardous substances, including, without limitation,
notices of violation and settlement actions from or with governmental or
quasi-governmental authorities, reports from Tenant's engineers or
consultants, and the results of any analyses conducted by or for Tenant.
Tenant specifically grants Landlord the right to participate in all
discussions and meetings regarding actual or potential violations,
settlements or abatements.
Tenant's failure to comply with the requirements of this Article will be a
material default under this Lease. All of Tenant's obligations under this
Article will survive the expiration or earlier termination of this Lease.
-27-
IN WITNESS WHEREOF, intending to be legally bound, each party has
executed this Lease as a sealed instrument as of the date first set forth above
on the date specified below next to its signature.
"LANDLORD"
NORTH ANDOVER MILLS REALTY, a Massachusetts
limited partnership
Executed: November 28, 1991 By: Niuna-North Andover, Inc., a Massachusetts
corporation, general partner
WITNESS:
/s/ John C. Cissel By: /s/ Martin Spaggat
- ------------------------------ -------------------------------------------
Name Printed Name
John C. Cissel Its: Vice President
By: CIIF Associates, a Massachusetts
partnership, general partner
By: Copley Advisors, Inc., a Massachusetts
corporation, managing general partner
WITNESS:
/s/ Julie A. Curll By: /s/ Michael H. Harrity
----------------------------- --------------------------------------
Name Printed Name: Michael H. Harrity
Its: Vice President
"TENANT"
Executed: November 20, 1991 FTP SOFTWARE, INC., a Massachusetts corporation
WITNESS:
/s/ John C. Cissel By: /s/ Nancy L. Connor
- ------------------------------ -----------------------------------------
Name Printed Nancy L. Connor, President
WITNESS:
/s/ John C. Cissel By: /s/ Nancy L. Connor
----------------------------- -----------------------------------------
Name Printed (Signature)
Nancy L. Connor
-----------------------------------------
Name Printed, Secretary
-28-
EXHIBIT "A"
-----------
SITE PLAN
-29-
EXHIBIT "A" Continued
---------------------
SITE PLAN
-30-
EXHIBIT "B"
-----------
PREMISES
SECOND FLOOR
-31-
EXHIBIT "B"
-----------
PREMISES
THIRD FLOOR
-32-
EXHIBIT "B"
-----------
PREMISES
FOURTH FLOOR
-33-
EXHIBIT "B"
-----------
PREMISES
DETAIL OF BUILDING #3
SECOND FLOOR COMMON CORRIDOR
-34-
EXHIBIT "B"
-----------
PREMISES
DETAIL OF BUILDING #3
THIRD FLOOR LOBBY
-35-
EXHIBIT "B"
-----------
PREMISES
DETAIL OF BUILDING #32
2nd, 3rd and 4th FLOORS
-36-
EXHIBIT "B" Continued
---------------------
PREMISES
EXPANSION SPACE
SECOND FLOOR
-37-
EXHIBIT "B" Continued
---------------------
PREMISES
EXPANSION SPACE
THIRD FLOOR
-38-
EXHIBIT "B" Continued
---------------------
PREMISES
EXPANSION SPACE
DETAIL OF BUILDING #3A - SECOND FLOOR
-39-
EXHIBIT "B" Continued
---------------------
PREMISES
EXPANSION SPACE
DETAIL OF BUILDING #3A - THIRD FLOOR
-40-
EXHIBIT "C"
WORKLETTER
1. General Conditions.
------------------
1.1 Tenant and its contractors may have access to the Premises for the
purpose of preparing the Premises for Tenant's occupancy at least sixty (60)
days before Landlord's Work has been substantially completed, provided that such
access does not interfere with or delay Landlord's Work. After any entry by
Tenant or its contractors, all of Tenant's Lease obligations will be immediately
effective except for the obligation to pay base rent, Taxes, Landlord's
insurance premiums and Operating Costs. All construction, materials, services,
licenses, approvals, costs, installations and equipment to or for the Premises
other than Landlord's Work are called "Tenant's Work", and will be performed by
Tenant at Tenant's sole cost and in a good and workmanlike manner and subject to
the rest of the terms of this Lease. Tenant will not interfere in any way with
Landlord's Work, whether in connection with Tenant's Work or otherwise. If
Landlord's Work is delayed or made more expensive due to: any act or omission of
Tenant or its Affiliates (including, without limitation, any delay of or failure
to complete Tenant's Work, any requested or required changes to the Final Plans
agreed to by Landlord, or any failure or delay in submitting plans,
specifications, drawings, requirements, information or approvals or changes or
inaccuracies in any of the foregoing), then Tenant will be responsible for the
delays and additional cost, Landlord's Work will be deemed substantially
completed when it would have been completed but for the delays (and at minimum
any delays will be subtracted from the date of actual substantial completion in
determining when substantial completion will be deemed to have occurred), and
Tenant will pay any additional cost to Landlord as additional rent within
fifteen (15) days after receipt of Landlord's bill. Within ten (10) days after
Landlord's request, Tenant will execute and deliver to Landlord a certificate
confirming the date of substantial completion of Landlord's Work. Tenant's
certificate is for purposes of confirmation only and will not affect the actual
date of substantial completion.
1.2 In addition, to the extent that all costs in connection with
Landlord's Work (other than the "Extra Costs" as defined in the rest of this
Workletter) exceed $15.75 multiplied by the initial rentable area of the
Premises excluding the bathroom areas in building 32 (the "Maximum Amount").
Tenant will pay those excess costs to Landlord as additional rent within fifteen
(15) days after receipt of Landlord's bills therefor from time to time, provided
that Landlord provides reasonable evidence for such costs. Also, as more fully
described in the rest of this Workletter, provided that certain conditions are
satisfied Tenant will be entitled to any savings if all costs in connection with
Landlord's Work (other than the Extra Costs) are less than the Maximum Amount.
-41-
1.3 The rest of this Workletter is attached and is incorporated herein by
this reference.
-42-
EXHIBIT "C" (Cont.)
WORKLETTER
This is a continuation of the Workletter attached to and incorporated in
Exhibit "C" to the Lease between FTP Software, Inc. ("Tenant") and North Andover
Mills Realty ("Landlord").
A. Landlord's Work; Tenant's Work. "Landlord's Work" means all labor,
------------------------------
services, materials, systems and equipment, installations and hookups, and all
necessary modifications thereto or occasioned thereby, and all required permits
and approvals, necessary to construct the improvements specified in or required
in connection with the Final Plans (defined below) and agreed-upon changes to
the Final Plans, in order to ready the Premises and the Building for occupancy
by Tenant. Landlord will construct these improvements substantially in
accordance with the Final Plans and agreed-upon change orders, subject to
compliance with applicable Laws and inaccuracies in the Final Plans and agreed-
upon changes thereto. Notwithstanding the foregoing, Landlord's Work will not
include any computer, data or telephone wiring or hookups or installation and
hookup of Tenant's systems, equipment and powered, moveable partitions, which
will be performed by Tenant at its expense. "Tenant's Work" means all labor,
services, materials, systems and equipment, installations and hookups to or for
the Premises (including, without limitation, the work described in the preceding
sentence) other than Landlord's Work. Tenant will perform Tenant's Work at its
cost.
-43-
B. Construction Representative. When Tenant signs this Lease, it will, by
---------------------------
written notice to Landlord, appoint a construction representative (who may be an
architect) who will be available to meet and consult with Landlord and its
representatives on a continuing basis at the Premises concerning Landlord's
Work, and who can and will render binding decisions on behalf of Tenant as
Tenant's agent promptly and in accordance with this Lease. Tenant may change
its construction representative by written notice to Landlord.
C. Final Plans. Within six (6) weeks after December 10, 1991, Tenant will
-----------
submit to Landlord and Landlord's architect two (2) sets of Tenant's proposed
final layouts, plans and specifications for all work that Tenant wishes Landlord
to perform (collectively, the "Plans"). The Plans submitted by Tenant shall be
biddable, permittable and constructable and contain final finish selections.
(Color selections will be made promptly by Tenant at Landlord's request in order
to avoid delays to the construction schedule.) Landlord and/or Landlord's
architect and engineer will notify Tenant in writing of any required changes
within ten (10) days after each of them has received full sets of the Plans.
Tenant and its architect will make the required changes and resubmit the revised
Plans to Landlord and Landlord's architect and engineer within seven (7) days
thereafter, and when the Plans have been satisfactorily revised, Landlord and
Tenant (or their architects) each will initial or stamp a set of the final,
revised Plans (the "Final Plans"). Shop drawings and finish product samples
will be submitted to Tenant's construction representatives for the limited
purpose of checking for conformity and the information given and the design
concepts expressed in the Final Plans. Shop Drawings
-44-
and samples will be stamped or initialed for approval by Tenant or its
construction representative, but whether or not stamped or initialed, they will
be deemed approved within five (5) days after they are submitted to Tenant's
construction representative unless written objections to the submissions are
received by Landlord's architect within that period. Tenant's construction
representatives will be kept informed of both the progress and results of the
bidding and pricing phases of Landlord's Work, and, if it wishes, it may submit
written change orders to Landlord pursuant to Section D. Below in an attempt to
reduce the cost of Landlord's Work.
D. Change Orders. During the course of construction, if Tenant wishes to
-------------
change the Final Plans, its construction representative will submit written
change orders to Landlord detailing the proposed change. If and to the extent
that Landlord or its architect wishes to clarify and/or change any aspect of the
proposed change order, it will contact and/or meet with Tenant and its
construction representative or, if Tenant wishes, Landlord will set forth its
clarifications or changes in writing. Change orders will be binding only when
signed by Landlord, and by Tenant or Tenant's construction representative.
E. Modifications to Loading Dock. In addition to Landlord's Work, Landlord,
-----------------------------
at its cost, also will modify and design the existing leading dock for the
Premises substantially in accordance with the plan attached hereto as
Exhibit "CC."
F. Base Building; Extra Costs. As part of the work for Tenant's initial move-
--------------------------
in, Landlord, at its cost, will: (a) provide the existing base building
conditions in the Premises
-45-
(subject to modifications and additions that are necessary in connection with,
required in order to perform, or result from Landlord's Work per the Final Plans
and agreed-upon changes thereto or Tenant's particular use of the Premises),
consisting of attached lighting fixtures, HVAC, electrical, subflooring (which
will be in a condition adequate to receive finish flooring or carpet), windows,
exterior walls, cable tray systems, wiring for the existing card access system,
a demising wall in buildings 1A and 3 (if necessary), and additional legal
egress from the Premises if required by code; (b) vacuum the joints between the
wooden ceiling deck or, if this is unsuccessful, apply a clear silicone sealer
to the joints of the wooden ceiling deck of Premises, all in an attempt to
prevent the falling of residual sand-blasting dust from between joints, and only
----
in those areas of the wooden ceiling deck directly beneath which polyethylene
sheeting is now suspended (and these steps are the limit of Landlord's
obligation in connection with this matter); and (c) wire back to the appropriate
fire alarm panels all sprinkler flow switches in the Premises which currently
are not so wired; and (d) provide bathrooms on each floor of the Premises in
building 32. "Extra Costs" means the costs to provide the items described in
the previous sentence, the costs to provide the loading dock modifications
(subject to Attachment "CC") as described in Section E. above, and the costs
incurred to make changes to the existing base building conditions described in
Subsection (a) above required by applicable Laws (but not costs incurred to make
---
changes that are necessary in connection with, required in order to perform, or
results from Landlord's Work per the Final Plans and agreed-upon changes thereto
or Tenant's particular use of the Premises). Also, Extra Costs
-46-
specifically do not include modifications or additions to the base building
---
conditions that are necessary in connection with, required in order to perform,
or result from Landlord's Work or Tenant's particular use of the Premises.
G. Savings. Subject to the rest of this Workletter, if the total of all costs
-------
in connection with Landlord's Work (excluding the Extra Costs) are less than the
Maximum Amount, Landlord will pay the savings to Tenant or, at Landlord's
option, credit the savings against amounts otherwise owed by Tenant under this
Lease, subject to the satisfaction of the following terms and conditions:
(a) For these purposes, the total of all costs of Landlord's Work will be
determined when all of Landlord's Work is completely finished, including punch
list items, and all costs (excluding the Extra Costs) have been billed and paid
for.
(b) Tenant is not in default, has occupied the Premises for the conduct of
its business, accepted the Premises by written notice to Landlord (including
acceptance of all punch list items other than those that the parties agree in
writing will not be Landlord's costs), and paid its first month's rent.
Exhibit C. FT3
12/12/91
-47-
ATTACHMENT "CC"
Landlord's obligation to modify the existing loading dock area at the 2nd level
and to the rear of building #3 will be as set forth below:
1. Two (2) covered standard loading dock bays, each will include dock
bumpers, with electrically operated doors (or doors operated with
another system approved by Tenant) from the Building to the
loading dock, and a "UPS" loading dock (space permitting).
2. Subject to providing the items above, the redesign of the loading
dock as required by these modifications will be in Landlord's
discretion, and if in Landlord's discretion the redesign requires
additional asphalt paving, landscaping (i.e., grass replacement),
storm drainage, retaining walls or design and construction
documents, the cost for those additional items will be paid by
Landlord. However, notwithstanding anything to the contrary herein
or elsewhere, Tenant will not be entitled to any savings in
connection with this work.
-48-
EXHIBIT "D"
BASE RENT
-----------------------------------
Annual Base Rent
----------------
Per Rentable Square
-------------------
Lease Year Foot in Premises
---------- ----------------
-----------------------------------
1 $10.55
-----------------------------------
2 $10.55
-----------------------------------
3 $10.55
-----------------------------------
4 $11.43
-----------------------------------
5 $11.43
-----------------------------------
6 $11.43
-----------------------------------
7 $12.39
-----------------------------------
8 $12.39
-----------------------------------
9 $12.39
-----------------------------------
10 $12.39
-----------------------------------
NOTE: THE BASE RENT RATES ABOVE DO NOT APPLY TO ANY STORAGE SPACE LEASED PER
ARTICLE 26, AND APPLY TO OFFER SPACE LEASED ONLY AS PROVIDED IN ARTICLE 27.
-49-
EXHIBIT "E"
RULES AND REGULATIONS
1. Fire exits and stairways are for emergency use only, and they shall
not be used for any other purposes. Tenant shall not encumber or obstruct, or
permit the encumbrance or obstruction of or store or place any materials on any
of the sidewalks, plazas, entrance, corridors, elevators, fire exits or
stairways of the Project. The Landlord reserves the right to control and
operate the public portions of the Project and the public facilities, as well as
facilities furnished for the common use of the tenants, and access thereto, in
such manner as it deems best.
2. The cost of repairing any damage to the public portions of the Project
or the public facilities or to any facilities used in common with other tenants
caused by Tenant or its Affiliates shall be paid by Tenant.
3. Any person whose presence in the Project at any time shall, in the
judgment of the Landlord, be prejudicial to the safety, character, reputation
and interests of the Project or its tenants may be denied access to the Project
or may be ejected therefrom. In case of invasion, riot, public excitement or
other commotion the Landlord may prevent all access to the Project or the
Building during the continuance of the same, by closing the doors or otherwise,
for the safety of the tenants and by protection of property. The Landlord shall
in no way be liable to any tenant for damages or loss arising from the
admission, exclusion or ejection of any person to or from Tenant's premises or
the Project under the provisions of this rule.
4. No awnings or other projections over or around the windows shall be
installed by Tenant and only such window blinds as are permitted by the Landlord
shall be used in Tenants's premises.
5. Hand trucks shall not be used in any space, or in the public halls of
the Building in the delivery or receipt of merchandise, except those equipped
with rubber tires and side guards. Tenant shall repair all damage to floors
both in the Premises and the Common Area caused by its use of material-handling
equipment and, if requested by Landlord, Tenant shall install at its expense
suitable floor covering to protect the floors and shall remove such floor
covering (and repair any damage caused by the removal) at its expense at the
expiration or earlier termination of this Lease. All air compressors, electric
motors and other machinery and equipment shall be shock-mounted so as not to
transmit vibrations.
-50-
6. All entrance doors in Tenant's premises shall be kept locked when
Tenant's premises are not in use. Entrance doors shall not be left open at any
time. All windows in Tenant's premises shall be kept closed at all times and
all blinds therein above the ground floor shall be lowered when and as
reasonably required because of the position of the sun, during the operation of
the air conditioning system to cool or ventilate the tenant's premises.
7. Nothing shall be done or permitted in Tenant's premises which would
impair or interfere with any of the Systems or Equipment or the proper and
economic servicing of the Building or the Premises, or the use or enjoyment by
any other tenant of any other premises, nor shall there be installed by Tenant
any Systems or Equipment or other equipment of any kind which, in Landlord's
judgment, could result in such impairment or interference. If necessary in
Landlord's judgment, Landlord may install, relocate, remove, use, maintain,
repair and replace Systems and Equipment within or serving the Tenant's premises
or other parts of the Project, and perform other work and alterations within the
Tenant's premises. No dangerous, inflammable, combustible or explosive object
or material shall be brought into the Building by Tenant or with the permission
of Tenant.
8. Whenever Tenant shall submit to Landlord any plan, agreement or other
document for Landlord's consent or approval, such tenant agrees to pay Landlord
as additional rent, on demand, a processing fee in a sum equal to the fees of
any architect, contractor, engineer and attorney employed by Landlord to review
said plan, agreement or document. Within fifteen (15) days after Landlord's
request from time to time, Tenant shall deliver to Landlord Tenant's financial
statements, including a balance sheet, income statements and bank references.
9. No acids, vapors hazardous or other materials shall be discharged or
permitted to be discharged into the waste lines, ducts, vents or flues which may
damage them or any other portions of the Building or the Project. The water and
wash closets and other plumbing fixtures in or serving any tenant's premises
shall not be used for any purpose other than the purpose for which they were
designed or constructed, and no sweepings, rubbish, rags, acids or other foreign
substances shall be deposited therein. All damage resulting from any misuse of
the fixtures shall be borne by the tenant who, or whose servants, employees,
agents, visitors or licensees, shall have caused the same.
10. No signs, advertisements, notice or other lettering shall be
exhibited, inscribed, painted or affixed by Tenant on any part of the outside or
inside the premises or the Building without the prior written consent of
Landlord. The Tenant shall cause the exterior of any permitted sign to be kept
clean, properly maintained and in good order and repair throughout the term of
its lease. In the event of the violations of the foregoing by Tenant, Landlord
may remove the same without any liability, and may charge the expense incurred
by such removal
-51-
to Tenant. Landlord shall have the right to prohibit any advertising by Tenant
which impairs the reputation of the Building or the Project, and upon written
notice from Landlord, Tenant shall refrain from or discontinue such advertising.
11. Tenant's employees shall not loiter around the hallways, stairways,
elevators, front, roof or any other part of the Building used in common by the
occupants thereof.
12. If the premises become infested with vermin, Tenant, at its sole cost
and expense, shall cause its premises to be exterminated, from time to time, to
the satisfaction of Landlord, and shall employ such exterminators therefor as
shall be approved by Landlord.
13. All movers used by Tenant shall be appropriately licensed and shall
maintain adequate insurance coverage (proof of such coverage shall be delivered
to Landlord prior to movers providing service in and throughout the Building).
Tenant shall protect the premises and the rest of the Building from damage or
soiling by Tenant's movers and contractors and shall pay for extra cleaning or
replacement or repairs by reason of Tenant's failure to do so.
14. The premises shall not be used for lodging or sleeping or for any
immoral or illegal purposes.
-52-
EXHIBIT "F"
BANKRUPTCY PROVISIONS
This Article is incorporated into the Lease as Article 23:
23. BANKRUPTCY OR INSOLVENCY.
------------------------
23.1 Tenant's Interest Not Transferable. Neither Tenant's Interest in this
----------------------------------
Lease nor any estate hereby created in Tenant nor any interest herein or therein
will pass to any trustee or receiver or assignee for the benefit of creditors or
otherwise by operation of law except as may specifically be provide pursuant to
the Bankruptcy Code, 11 U.S.C. Section 101 et seq. (the "Bankruptcy Code").
-- ---
23.2 Default and Termination. If:
-----------------------
(a) Tenant or Tenant's Guarantor, if any, or its executors,
administrators, or assigns, will generally not pay its debts as they become
due or will admit in writing its inability to pay its debts, or will make a
general assignment for the benefit of creditors; or
(b) Tenant or Tenant's Guarantor, if any, will commence any case,
proceeding or other action seeking reorganization, arrangement, adjustment,
liquidation, dissolution or composition of it or its debts under any law
relating to bankruptcy, insolvency, reorganization or relief of debtors, or
seeking appointment of a receiver, trustee, custodian or other similar
official for it or for all or any substantial part of its property; or
(c) Tenant or Tenant's Guarantor, if any, will take any corporate,
partnership or other action to authorize or in furtherance of any of the
actions set forth above in subsections (a) or (b); or
(d) Any case, proceeding or other action against Tenant or Tenant's
Guarantor, if any, will be commenced seeking to have an order for relief
entered against it as debtor, or seeking reorganization, arrangement,
adjustment, liquidation, dissolution or composition of it or its debts
under any law relating to bankruptcy, insolvency, reorganization or relief
of debtors, or seeking appointment of a receiver, trustee, custodian or
other similar official for it or for all or any substantial part of its
property, and such case, proceeding or other action: results in the entry
of an order for relief against it which is not fully stayed within seven
(7) business days after the entry thereof; or remains undismissed for a
period of forty-five (45) days, then it will be a
-53-
default hereunder and this Lease and all rights of Tenant hereunder will
automatically cease and terminate as if the date of such event were the original
expiration date of this Lease and Tenant will vacate and surrender the Premises
but will remain liable as herein provided.
23.3 Right and Obligations Under the Bankruptcy Code.
-----------------------------------------------
(a) Upon the filing of a petition by or against Tenant under the
Bankruptcy Code, Tenant, as debtor and as debtor in possession, and any trustee
who may be appointed agree as follows: (i) to perform all obligations of Tenant
under this Lease, including, but not limited to, the covenants regarding the
operations and uses of the Premises until such time as this Lease is either
rejected or assumed by order of the United States Bankruptcy Court; (ii) to pay
monthly in advance on the first day of each month as reasonable compensation for
use and occupancy of the Premises an amount equal to all Monthly Minimum Rental
and other rent otherwise due pursuant to this Lease; (iii) to reject or assume
this Lease within sixty (60) days of the filing of a petition under any Chapter
of the Bankruptcy Code or under any Law relating to bankruptcy, insolvency,
reorganization or relief of debtors (any such rejection being deemed a rejection
and automatic termination of this Lease); (iv) to give Landlord at least thirty
(30) days prior written notice of any proceeding relating to any assumption of
this Lease; (v) to give at least thirty (30) days prior written notice of any
abandonment of the Premises (any such abandonment being deemed a rejection and
automatic termination of this Lease); (vi) to do all other things of benefit to
Landlord otherwise required under the Bankruptcy Code or under any Law relating
to bankruptcy, insolvency, reorganization or relief of debtors; (vii) to be
deemed to have rejected this Lease in the event of the failure to comply with
any of the above; and (viii) to have consented to the entry of an order by an
appropriate United States Bankruptcy Court providing all of the above, waiving
notice and hearing of the entry of same.
(b) No default under this Lease by Tenant, either prior to or
subsequent to the filing of such petition, will be deemed to have been waived
unless expressly done so in writing by Landlord.
(c) Included within and in addition to any other conditions or
obligations imposed upon Tenant or its successor in the event of assumption
and/or assignment are the following: (i) the cure of any monetary defaults and
the reimbursement of pecuniary loss by the time or the entry of the order
approving such assumption and/or assignment (pecuniary loss will include,
without limitation, any attorneys' fees and costs and expert witness fees
incurred by Landlord in protecting its rights under this Lease,
-54-
including representation of Landlord in any proceeding commenced under the
Bankruptcy Code or under any Law relating to bankruptcy, insolvency,
reorganization or relief of debtor); (ii) the deposit of an additional sum
equal to three (3) months' base rent; (iii) the use of the Premises only as
set forth in this Lease; (iv) the reorganized debtor or assignee of such
debtor in possession or of Tenant's trustee demonstrates in writing that it
has sufficient background including, but not limited to, substantial
experience in operating businesses in the manner contemplated in this Lease
and meet all other reasonable criteria of Landlord as did Tenant upon
execution of this Lease; (v) meeting all other criteria of 11 U.S.C.
Section 365(b)(3); and (v) the prior written consent of any mortgagee to
which this Lease has been assigned as collateral security; and (vi) the
Premises at all times remains a single unit and no Alterations or physical
changes of any kind may be made unless in compliance with the applicable
provisions of this Lease.
(d) Any person or entity to whom this Lease is assigned pursuant to
the provisions of the Bankruptcy Code will be deemed without further act or
deed to have assumed all of the obligations arising under this Lease on or
after the date of such assignment. Any such assignee will upon demand
execute and deliver to Landlord an instrument confirming such assumption.
23.4 Construction. The terms of this Article will be in addition to, but
------------
not exclusive of, any rights or remedies of Landlord in Article 22 and elsewhere
in this Lease or otherwise available at law or in equity, and will not be deemed
to limit Landlord, except as may be required by law.
-55-
RIDER #1
26. STORAGE SPACE.
-------------
If Tenant is not in default, on prior written notice to Landlord Tenant
will have the right to lease unleased space in the Building designated as vacant
by Landlord for use as storage space (the "Storage Space") on a month-to-month
basis. To the extent so leased, the Storage Space will become part of and
increase the size of the Premises. Tenant's base rent for the Storage Space
will be Three and No/100 Dollars ($3.00) per annum per square foot of rentable
area, payable monthly in advance with the rest of the base rent as described in
Article 5. Either Landlord or Tenant may cancel this Lease as to the Storage
Space at any time on thirty (30) days prior written notice to the other.
Landlord will not be required to provide maintenance or services for the Storage
Space or protect or have any Liabilities for items stored therein. Tenant will
use the Storage Space solely for storage of Tenant's Property, and not for any
other purpose, nor will Tenant store any hazardous substances in the Storage
Space or make any Alterations thereto. Tenant may Transfer the Storage Space
only pursuant to a Transfer of the rest of the Premises.
27. RIGHT OF FIRST OFFER.
--------------------
"Offer Space" means the unleased space in the Project east of High Street
designated as vacant by Landlord, with the exception of any space constructed
after the date of this Lease. During the first five (5) Lease Years, Tenant will
have the right to lease the Offer Space on the following terms and conditions:
(a) Subject to the rest of this Article, before leasing all or any
part of the Offer Space during the first five (5) Lease Years, Landlord
will notify Tenant in writing of the rentable area of that part of the
Offer Space and the base rent that Landlord will accept for that space. If
Tenant wishes to exercise its right to lease that space, it must deliver an
unconditional written notice of exercise to Landlord within twenty (20)
days after receipt of Landlord's notice. Tenant may not lease less than the
entire space offered. Unless otherwise agreed by Landlord and Tenant, the
rentable area of each portion of the Offer Space (and the Storage Space,
Expansion Space and any other space in the Premises) will be determined by
Landlord's architect's measurement of the area, determined by measuring
from interior face of glass to interior of face of glass without
deductions. Time is of the essence, and if Tenant does not exercise its
rights as described above, its rights to lease that portion of the Offer
Space will lapse and become null and void, except only as described in
Subsection (d) below.
-56-
(b) Subject to the rest of this Article, if Tenant exercises its
rights as described above, when Landlord tenders vacant possession of that
portion of the Offer Space to Tenant it will become part of the Premises
and the rentable area of the Premises will be increased by the rentable
area of that portion, and the base rent for that space will be as described
in Subsections (d) below.
(c) These rights are personal to the Tenant originally named in this
Lease and may not be exercised by or for any other Transferee or other
person or entity. Whether or not these rights have been exercised, these
rights will lapse and Tenant will have no rights in connection with any
Offer Space if, before vacant possession of any Offer Space is tendered to
Tenant, Tenant defaults or Transfers all or part of this Lease or the
Premises (except for permitted subleases aggregating less than 16,000
rentable square feet). Also, Tenant may not exercise any rights under this
Article 27 unless and until it first has exercised all of its Expansion
Options and leased the maximum amount of Expansion Space possible per
Article 28. (For example, if Tenant wishes to exercise its rights under
this Article during the first Lease Year, it first must have exercised all
three of the Expansion Options and lease approximately 30,000 square feet
of rentable area under Article 28. If Tenant already has exercised its
First Expansion Option for 10,000 square feet and wishes to exercise it
rights under this Article during the Second Lease Year, it must first
exercise its Second and Third Expansion Options for an additional 20,000
square feet of rentable area under Article 28). Tenant's option, expansion,
extension, or similar rights that have been granted to the existing tenants
in the Project (and their successors and assigns) as of the date of this
Lease.
(d) The base rent per annum per square foot of rentable area for each
part of the Offer Space will be the greater of: the base rent in
Exhibit "D"; or the base rent per square foot in Landlord's initial notice
for that space. However, as provided in the last sentence of
Subsection (a) above, and subject to the rest of this Article 27, if Tenant
fails to exercise its option with respect to that space, during the first
five (5) Lease Years Landlord may not enter into any other lease for that
space for an average net base rent per square foot specified in Landlord's
initial notice without first reoffering that space to Tenant. The reoffered
base rent per square foot will be equal to the greater of: the base rent as
shown in Exhibit "D"; or that lesser base rent. If Tenant wishes to
exercise its option it must do so as described in Subsection (a) above, and
if it does not, Tenant's rights to lease that part of the Offer Space (as
increased or decreased by up to twenty percent 20% of the usable space)
will lapse and become null and void.
28. EXPANSION OPTIONS.
-----------------
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28.1 Expansion Options. Landlord grants to Tenant three (3) options (the
-----------------
"First Expansion Option," the "Second Expansion Option," and the "Third
Expansion Option") to Lease portions of the Expansion Space on the same terms
and conditions as this Lease, except as set forth below. "Expansion Space"
means the space in buildings 3A and 11 in the Project as so designated in
Exhibit "B". The First, Second and Third Expansion Options can be exercised
only by Tenant delivering unconditional written notice of exercise to Landlord
at lease six (6) months before the end of the first, second and third Lease
Years, respectively. If for any reason Landlord does not actually receive this
unconditional written notice of exercise when required for a particular
Expansion Option, that expansion Option and all subsequent Expansion Options
will lapse and become null and void. The Expansion Options are granted to and
may be exercised by Tenant on the express condition that, at the time of the
exercise and at all times before vacant possession of any Expansion Space is
delivered to Tenant, Tenant is not in default. TIME IS ABSOLUTELY OF THE
ESSENCE. The Expansion Options are personal to the Tenant originally named in
this Lease and may not be exercised by or for anyone else, and if Tenant
Transfers any part of the this Lease or the Premises (except for permitted
subleases aggregating less than 16,000 square feet of rentable area) before the
beginning of an Expansion Option term, at Landlord's election that Expansion
Option and all subsequent Expansion Options will lapse and become null and void.
28.2 Size of Expansion Space. For each of the Expansion Options, Tenant
-----------------------
may lease no less than approximately 3,000 square feet of rentable area.
Subject to Section 28.3(c), for the First Expansion Option, Tenant may lease no
more than a full floor in building 3A. Subject to Section 28.3(c), for the
Second Expansion Option, Tenant may lease no more than it leased for the First
Expansion Option (if any). Subject to Section 28.3(c), for the Third Expansion
Option, Tenant may lease no more than it leased for the Second Expansion Option
(if any).
28.3 Additional Terms.
----------------
(a) Landlord will not incur Liabilities to Tenant if Landlord is
unable to deliver vacant possession of any of the Expansion Space by the
required dates if due to the holdover of a previous tenant or force
majeure, but if due to a holdover Landlord will diligently attempt to
deliver vacant possession of that space as soon as reasonably possible, and
Tenant's rights and obligations with respect to that space will commence as
soon as Landlord delivers vacant possession.
(b) When Landlord tenders vacant possession of any Expansion Space to
Tenant, that space will become part of the Premises and the rentable area
of the Premises will be increased by the rentable area of that Expansion
Space.
-58-
(c) Tenant first must lease all Expansion Space in building 3A before
it can lease any Expansion Space in building 11. For Tenant's First
Expansion Option, it must lease either all of the 3rd floor (i.e., the
middle floor) of building 3A or the area on that floor designated as
"Expansion Area AA" in Exhibit "B." If Tenant has leased Expansion Area AA
for its First Expansion Option, for its Second Expansion Option it must
lease only "Expansion Area BB" as shown in Exhibit "B," which is the rest
of the 3rd floor of building 3A. If Tenant chooses (and is permitted) to
lease Expansion Space on the bottom floor of building 11, it must lease the
full floor of Expansion Space and not a partial floor, at Landlord's option
(even if this conflicts with Section 28.2). Notwithstanding anything to the
contrary, unless otherwise elected by Landlord (and unless otherwise
permitted by code) any bathrooms and corridors in building 3A, the corridor
on the bottom floor of building 11 and the lobby area(s) as shown in
Exhibit "B" will be and remain Common Area, and if Tenant leases Expansion
Space, a pro rata share of the rentable area of these bathrooms, corridors
and lobbies will be included in the rentable area of Tenant's Expansion
Space. Unless Tenant leases Expansion Space in building 3A, Tenant agrees
that it will not use the bathrooms or the lobby area on the 3rd floor of
building 3A. Tenant will have the non-exclusive right to use the bathrooms
on the bottom floor of building 3A until and unless Landlord modifies those
bathrooms to provide Tenant with exclusive use of one bathroom for men and
one bathroom for women with direct access from Tenant's existing Premises,
at which time these exclusive bathrooms will become part of the Premises.
Landlord also has the right to acoustically and/or visually separate the
upper lobby area on the 4th floor of building 3A from the lower lobby area
using transparent and/or translucent materials.
(d) Subject to and except as provided in Subsection (c) above and the
rest of this Article, Expansion Space always shall be for space contiguous
to the Premises and in regular blocks in such locations and with such
configurations as Landlord and Tenant will reasonably agree upon, taking
into consideration the specific requirements of Tenant, as well as
Landlord's need to configure and locate the Expansion Space so that the
remaining space forms marketable and desirable leasable units for other
potential tenants without requiring Landlord to make major (i.e.,
expensive) renovations to the remaining space or the rest of the Project in
order to provide reasonable and customary access thereto or meet applicable
Laws and codes or add to or reconfigure existing Systems and Equipment. If
and to the extent that the rest of this Article and/or Subsection (c) above
does not apply and the parties cannot reasonably agree on the location or
configuration of Expansion Space, each agrees to submit the matter to
arbitration as provided in Section 24.13.
-59-
RIDER #2
EXTENSION OPTION
1. Landlord grants to Tenant one (1) option (the "Option") to extent the Lease
Term for an additional term of five (5) years. There will be no further
right to extend. The Option can be exercised only by Tenant delivering
unconditional written notice of exercise to Landlord at least one (1)
calendar year before the expiration of the initial term. If for any reason
Landlord does not actually receive this notice of exercise when required,
the Option will lapse and become null and void and there will be no further
right to extend the Lease term. The Option is granted to and may be
exercised by Tenant on the express condition that, at the time of the
exercise and at all times before the beginning of the Option period, Tenant
is not in default (and has not committed acts or omissions which would
constitute a default with the passage of time or the giving of notice or
both). TIME IS ABSOLUTELY OF THE ESSENCE.
2. The Option is personal to the Tenant originally named in this Lease, and it
may not be exercised by or for anyone else. If during the initial term
Tenant Transfers any part of this Lease or the Premises (except for
permitted subleases aggregating less than 16,000 square feet of rentable
area), at Landlord's written election this Option will lapse and become
null and void, whether or not it has been exercised. The base rent for each
Lease Year of the Option period will be increased to the levels as set
forth below:
Lease Year Annual Base Rent Per Rentable
---------- -----------------------------
Square Foot in Premises
-----------------------
11 $13.95
12 13.95
13 15.56
14 15.56
15 15.56
NOTE: THE BASE RENT RATES ABOVE DO NOT APPLY TO ANY STORAGE SPACE LEASED PER
ARTICLE 26.
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RIDER #3
RIGHT TO CHANGE PROJECT
1. If there is any conflict between the rest of this Lease (including other
Riders and Exhibits) and this Rider, this Rider will control
2. Landlord's rights in connection with the Project include, without
limitation, the right to eliminate the softball field or convert it for
other uses and the right to separate the Project into separate parcels by a
lot split or otherwise. As a hypothetical example, Landlord might split the
Project into two parcels, one lying east of High Street and one lying west
of High Street. If Landlord does separate the Project into separate parcels
it will have the right to change the Lease definition of the Project so
that the Project consists only of the land and improvements within the
parcel(s) designated by Landlord (and of course the definition of the
Project always will include the parcel that contains the Premises), and in
that case Tenant's Percentage would be the agreed rentable area of the
Premises divided by the rentable area of the space held for lease in the
designated parcel(s).
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