EXHIBIT 10.38
LEASE
This LEASE made November 16, 2000 by and between Xxxxxxxxxx & Schuell, Inc., a
Delaware corporation with offices at 10 Optical Avenue, Keene, NH
03431(hereinafter "Landlord"), and Merrimack Services Corporation, a Delaware
corporation with offices at 000 Xxxxxxx Xxxx, Xxxxxxxxx, Xxx Xxxxxxxxx 00000
(hereinafter "Tenant").
WHEREAS, Landlord owns a certain building known as 00 Xxxxxxx Xxxxxx,
Xxxxx, Xxx Xxxxxxxxx; and
WHEREAS, Tenant desires to lease certain space in said building (the
"Premises"),
NOW, THEREFORE, in consideration of the mutual covenants contained herein,
the parties agree as follows:
1. PREMISES. Landlord agrees to lease to Tenant the Premises, comprising an
area of 10,374 square feet, more or less, located at 00 Xxxxxxx Xxxxxx, Xxxxx,
Xxx Xxxxxxxxx. Tenant may sublease the Premises, or portions thereof, to its
affiliated corporations provided it remains liable to Landlord for the rent.
2. TERM. The term of this Lease shall be five (5) years, commencing upon
completion of renovations (see Schedule "A") and delivery of the Premises to
Tenant, which shall be evidenced by a Certificate of Occupancy issued by the
City of Xxxxx.
3. OPTION. Landlord hereby grants to Tenant two (2) additional two-year
extensions to this Lease, at Tenant's sole option. Tenant may exercise said
options by providing Landlord with written notice of its intent to exercise the
options no later than ninety (90) days before the termination of the Lease or
any subsequent extension.
4. RENT.
(a) Tenant shall pay rent to Landlord at a rate of $11.75 per square foot
per annum, or $121,894.50 per annum, paid in 12 equal monthly installments of
$10,157.88 on the 1/st/ day of each month during the initial term of this Lease,
less the following amount: The final actual total of Column B on Attachment A,
divided by 5 years, divided by 10,374 square feet. In addition,
tenant shall pay, as additional rent, the sum of $1,000.00 per month for the
parking described in paragraph 15. Annually, on the anniversary date of this
Agreement, the Landlord may increase the monthly parking rate per CPI, not to
exceed 5%.
(b) During the first option term, if exercised, Tenant shall pay rent to
Landlord at a rate of $11.75 per square foot per annum, or $121,894.50 per
annum, subject to annual increase in accordance with CPI, not to exceed 5%, paid
in 12 equal monthly installments on the 1st day of each month during first
option term of this Lease.
(c) During the second option term, if exercised, Tenant shall pay at a
per annum rate established for prior option term plus adjustment per CPI.
5. DEPOSIT. A deposit consisting of an amount equal to one (1) month's rent
shall be paid commensurate with the payment of the first monthly rental payment.
This deposit shall be applied towards the last month's rent.
6. RENOVATIONS. Landlord authorizes tenant to contract services of others to
renovate the space defined by Attachment A, including "selective demolition, new
wall construction, ceilings, flooring, ADA compliant restrooms,
electrical/mechanical systems, fire protection and room finishes, in accordance
with architectural documents to be developed and attached to this document as
Attachment B. For the sake of expediting this effort, the budget values
identified in Attachment A shall be used to calculate the reduction of lease
rate commensurate with the tenants investment in initiation renovation of the
premises. Upon completion of the renovation, the reduced lease rate may be
adjusted via amendment, to reflect actual costs incurred.
7. OPERATIONS. The parties agree that each shall furnish and pay for the
cost of operations as indicated below:
To be furnished by:
(a) Utilities (electricity, heat, water, sewer, phone). Tenant
(b) Trash removal. Tenant
(c) Replacement of bulbs and fluorescent tubes. Tenant
(d) Window washing. Landlord
(e) Replacement of broken glass. Landlord
(f) Janitorial and cleaning services. Tenant
(g) All maintenance and repairs to the Premises including
HVAC . Landlord
(h) Common area costs, including clearing and removal
of ice and snow from walkways, parking lot area and
roof when necessary for safety, sanding, and grounds
maintenance. Landlord
(i) Structural integrity of the roof and buildings and
replacement of any part of the HVAC system when
necessary. Landlord
(j) Parking lot maintenance, including asphalt sealing and
repair and re-striping. Landlord
(k) Maintenance and repair of fuel storage tanks including
any underground fuel storage tanks. Landlord
7. INSURANCE.
(a) Landlord shall maintain all-risk property insurance on the Premises
in at least the amount of the replacement value of the Premises. Landlord shall
also maintain combined bodily injury and property damage insurance on said
property in an amount not less than Five Hundred Thousand Dollars ($500,000.00)
and One Million Dollars ($1,000,000.00) in aggregate. Insurance policies shall
be issued by financially responsible insurers authorized to do business in the
State of New Hampshire.
(b) Tenant shall maintain liability insurance on its business and
operations on the Premises, in an amount of not less than Five Hundred Thousand
Dollars ($500,000.00) per incident and One Million Dollars ($1,000,000.00) in
aggregate. Insurance policies shall be issued by financially responsible
insurers authorized to do business in the State of New Hampshire.
(c) Each party shall provide the other party of evidence of insurance
upon execution of this Lease and thereafter upon request.
8. TAX. Landlord shall pay all real estate taxes when due. In the event
Landlord fails to pay any such tax or related charges when due, Tenant shall
have the option to pay such tax and related charges and deduct said amounts from
its rent payments.
9. LANDLORD'S REMEDIES. Landlord may deem Tenant to be in breach of this Lease
following any of the following events, upon written notice to Landlord:
(a) If Tenant fails to pay rent or other charges and assessments when due
and payable under this Lease within ten (10) days following written notice of
failure to pay;
(b) If Tenant fails to commence to cure any other violation of its
covenants within twenty (20) days following written notice thereof or, having
commenced to cure, fails to conclude such cure with reasonable diligence; and
(c) Upon the adjudication of Tenant as a bankrupt or the appointment of a
receiver of its property.
10. UNTENANTABILITY. If the Premises, or any portion thereof, are made
untenantable by fire, the elements, or other casualty, rent for the leased
Premises, or affected portion thereof, shall xxxxx from the date of such
casualty until its restoration to tenantability. Landlord shall restore the
Premises with all reasonable speed and, if Landlord does not restore the
Premises or the affected portion thereof to tenantability within one hundred
twenty (120) days, Tenant may terminate this Lease. If the Premises are more
than fifty percent (50%) destroyed by such casualty, either Landlord or Tenant
may terminate this Lease unless Landlord is able to rebuild and restore the
premises within one hundred twenty (120) days of such casualty. Rent shall xxxxx
during such period of untenantability.
11. INSPECTION. Landlord shall have the right upon reasonable notice to enter
the premises during normal business hours for reasonable inspections and, in
addition, shall have the right to show the Premises to prospective tenants
during the last 60 days of the term, provided the Landlord and its guests are
accompanied by Tenant.
12. LANDLORD'S IMPROVEMENTS.
(a) Landlord shall have the right at its own expense to re-landscape and
make cosmetic changes to the Premises during the term of the Lease. Any such
work will be coordinated with Tenant so that business operations of the Tenant
will not be disturbed and security of the Premises is not compromised.
(b) Landlord may at its own expense place a "for lease" sign on the
property if the Tenant does not exercise the option to extend this Lease.
13. SIGNS. Landlord must approve in advance of installation any signs,
lettering or plaques that Tenant desires to affix to the building, doors,
windows, or any exterior part of the Premises. Such approval shall not be
unreasonably withheld.
14. TENANT'S ALTERATIONS AND IMPROVEMENTS. Except for the fix-up work described
herein, Tenant shall not make any alterations or improvements to the Premises
without the prior written consent of Tenant, which consent shall not be
unreasonably withheld.
15. PARKING.
(a) Landlord shall provide on the Premises the required parking spaces for
Tenant and its employees and guests. These spaces shall be for the use of
Tenant's employees on the Premises, as well as employees and guests of the
Tenant's 000 Xxxxxxxx Xxxxxx facility.
16. EFFECT OF TERMINATION. Upon termination of this Lease, or any extension
thereof, any and all improvements, alterations or modifications that are affixed
to the real estate, and normally considered to be part of the real estate, shall
become the property of the Landlord. This includes, but is not limited to,
ceilings, flooring, carpeting, shelving (which is affixed to the real estate),
partitions, walls, wall coverings and the like. Upon termination of this Lease,
Tenant may remove its own personal property not considered fixtures, such as
Venetian blinds, curtains, office equipment, business machines, trade fixtures,
signs and the like.
17. CONDEMNATION. If the leased Premises, or any significant portion thereof,
are taken by eminent domain, or condemned for public use, this Lease may be
terminated upon written
notice by either Landlord or Tenant, and any and all awards for such taking
shall be the exclusive property of the Landlord; provided, however, that nothing
contained herein shall be construed to preclude Tenant from prosecuting any
claim directly against the condemning authority in such condemnation proceedings
for loss of business or depreciation or, damage to, or cost of removal of, or
the value of stock and other personal property belonging to the Tenant;
provided, however, that no such claim shall diminish or otherwise adversely
affect Landlord's award or the award of any mortgagee.
18. SUCCESSORS AND ASSIGNS. This Lease is binding on the parties hereto and
their respective heirs, executors, administrators, successors and assigns. This
Lease may be assigned by Tenant to its parent, subsidiary, or sister
corporations, provided that Tenant shall remain obligated to make all payments
required hereunder.
19. ENTIRE AGREEMENT. This Lease embodies the entire agreement between the
parties, and there are no promises, terms, conditions or obligations referring
to the subject matter herein other than those contained herein. There may be no
modification of this Lease except in writing, executed by both Landlord and
Tenant with the same formalities as this Lease.
20. GOVERNING LAW. This Lease shall be construed under the laws of the State of
New Hampshire.
Agreed:
Xxxxxxxxxx & Schuell, Inc. Merrimack Services Corporation
By: /s/ Xxxxx Konstantin By: /s/ Xxxxx X. Xxxxxx
------------------------------ ------------------------------
Xxxxx Konstantin, Xxxxx Xxxxxx, President
President, General Manager
Legal Dept.
/s/ ILLEGIBLE
-----------------
Attachment A
Renovations to 10,374 square feet at 00 Xxxxxxx Xxxxxx, Xxxxx, XX
Task Column A Column B
---- Budget Value Credit Toward
------------ -------------
Rent
----
Architectural Development $ 14,800.00 $ 0.00
General Conditions (Supervision, dump fees, demolition) $ 15,740.00 $ 15,740.00
Sitework (walkway, landscaping) $ 9,550.00 $ 0.00
Concrete (floor patches/trenching) $ 1,700.00 $ 1,700.00
Masonry (for new entry) $ 1,200.00 $ 0.00
Masonry (for restroom - ADA - needs) $ 2,800.00 $ 2,800.00
Roof (curbs/penetrations) $ 6,500.00 $ 6,500.00
Carpeting $ 27,800.00 $ 0.00 *
Carpentry (partitions, ceilings, painting) $ 50,790.00 $ 25,395.00
Carpentry (cabinets) $ 5,400.00 $ 0.00
New Entry $ 8,800.00 $ 0.00
Mechanical Systems (plumbing/HVAC) $186,160.00 $186,160.00
Electrical (power, lighting) $ 42,900.00 $ 42,900.00
Electrical (power distribution to workstations) $ 15,000.00 $ 0.00
Fire Protection (sprinkler system) $ 16,975.00 $ 16,975.00
Contingency $ 5,000.00 $ 5,000.00
$411,115.00 $303,170.00
Values listed are Budget Values only. Actual costs to be confirmed via
competitive pricing and resulting credit toward rent shall be adjusted according
via amendment to Lease upon completion of renovations. Landlord and Tenant agree
to work collectively to control cost of renovation effort.
Using budget values shown above, the credit toward rent, on a per square
foot basis, shall be as follows:
$303,170.00 / 5 years / 10,374 sf = $5.84/sf
Final Actual Amount:
$5.84
*Denotes budget amount. Actual cost shall be calculated at 50% of carpentry cost
incurred.
