FIRST AMENDMENT TO LEASE
EXHIBIT
10.18
FIRST
AMENDMENT TO LEASE
This
First Amendment to the certain Lease dated September 23, 2004 (“Original Lease”)
and described below, is made and entered into upon the 5th day of February,
2007, by and between the parties and upon the terms and conditions hereinafter
set forth. This Amendment shall serve to amend only the paragraphs listed below;
all other terms and conditions of the Lease are hereby confirmed to be in full
force and effect. This First Amendment to Lease must be executed by November
30,
2006 or it will expire and will be of no further effect.
SECTION
1.2 BASIC DATA.
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Landlord:
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Xxxxxx
X. Xxxxxxx as Trustee of MAT Realty Trust
u/d/t
dated June 4, 1986 and recorded with the
Worcester
County Registry of Deeds
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Landlord's
Original Address:
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c/o
Atlantic Xxxxxxx
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0
Xxxxxxx Xxxx, Xxxxx 000
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|
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Xxxxxxxxx,
XX 00000
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|
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Tenant:
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Viking
Systems, Inc.
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Tenant's
Original Address:
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000
Xxxxxxxx Xxxx
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Xxxxxxxxxxx,
XX
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Guarantor:
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NA
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Basic
Rent:
For the
first, second and third year of the Term, the sum of One-Hundred Sixty Thousand
Three Hundred Eighty ($160,380.00) Dollars per annum or $9.00 per square foot
of
Premises Rentable Area; as the same may be adjusted and/or abated pursuant
to
Section 12.1. If the Term of this Lease includes any partial calendar month
after the Commencement Date and before the beginning of Lease Year 1, Basic
Rent
shall be payable during such partial calendar month at the rate applicable
during Lease Year 1.
Monthly
Rent Payment:
For
Lease Year 1, 2 and 3, $13,365.00 per month
Premises
Rentable Area:
Approximately 17,850 square feet located on the 1st floor of the
Building.
Permitted
Uses: General
office, exclusive however of an office use that would cause or result in the
Premises being deemed "a place of public accommodation" as defined in the
Americans with Disabilities Act of 1990, as amended (the "Disabilities
Act").
Tenant’s
Proportionate Share:
31.3%,
as computed in accordance with the Percentage Share Computation.
Initial
Term: Three
(3)
years commencing on the Commencement Date and expiring at the close of the
day
immediately preceding the anniversary of the Commencement Date, except that
if
the Commencement Date shall be other than the first day of a calendar month,
the
expiration of the Initial Term shall be at the close of the day on the last
day
of the calendar month on which such anniversary date shall
fall.
-1-
Security
Deposit: $26,730.00
- Two Months Rent
Parking:
Non-exclusive
use of 60 spaces in the Building parking lot, to be used in common with other
tenants, guests, employees, invitees and others entitled to the use
thereof.
ARTICLE
XV
OPTIONS
TO EXTEND
15.1 TENANT'S
OPTIONS.
(a)
Provided that, at the time of such exercise, this Lease is still in full force
and effect without an Event of Default by Tenant and Tenant occupies at least
seventy-five percent (75%) of the Rentable Area of the Premises for its own
business purposes, Tenant shall have the right and options (the "Extension
Options") to extend the Term of this Lease for One (1) extended term of Three
(3) years (an "Extended Term"). The Extended Term shall commence on the day
immediately succeeding the expiration date of the Initial Term, and shall end
on
the day immediately preceding the third anniversary of the first day of such
Extended Term. Tenant shall exercise its Extension Option for the Extended
Term
by giving written notice to Landlord of its desire to do so not later than
six
(6) months prior to the expiration date of the Initial Term. The giving of
such
notice by Tenant shall automatically extend the Term of this Lease for the
Extended Term, and no instrument of renewal need be executed. In the event
that
Tenant fails to give such notice to Landlord this Lease shall automatically
terminate at the end of the Initial Term, and Tenant shall have no further
option to extend the Term of this Lease. The Extended Term shall be on all
the
terms and conditions of this Lease, except (i) during any Extended Term, the
extension provisions of this Section to the extent already exercised shall
not
be effective, (ii) that the Basic Rent in effect for the Extended Term shall
be
at the greater of (a) the then current Basic Rent during the last lease Year
of
the Initial Term and (b) the anticipated fair market rental rate for comparable
buildings in the Westborough area for the Premises Rentable Area during the
Extended Term (the "Prevailing Fair Market Base Rental Rate") determined as
follows. Within twenty (20) days of Tenant's exercise of its Extension Option,
Landlord agrees to provide Tenant with Landlord's determination ("Landlord's
Determination") of the Fair Market Base Rental Rate. Any determination of the
Fair Market Base Rental Rate, whether by Landlord or Tenant, shall include
a
statement of the elements of rent included in such determination (whether tenant
improvement allowances, free rent, common area cost allowances, or otherwise)
sufficient to permit a calculation of the effective rent for the
Premises.
(b) If
Tenant
does not agree with Landlord's Determination, provide Landlord with notice
of
its determination of the Fair Market Base Rental Rate ("Tenant's Determination")
within twenty (20) days of Tenant's receipt of Landlord's Determination; if
Tenant fails to provide Landlord on a timely basis with Tenant's notice to
terminate as aforesaid or Tenant's Determination as set forth herein, Tenant
will be deemed to have agreed to Landlord's Determination which then shall
constitute the basis for determining the Base Rent for the Extended Term. Except
as set forth in subparagraph (c) below, if Landlord's Determination and Tenant's
Determination are different and Landlord and Tenant are unable to agree upon
the
Fair Market Base Rental Rate within thirty (30) days of Landlord's receipt
of
Tenant's Determination, the parties shall within fifteen (15) days after the
end
of such 30-day period, together appoint a mutually acceptable arbitrator or,
if
they are unable to agree upon such an arbitrator, shall apply to the American
Arbitration Association for the designation of an arbitrator located in the
Boston, Massachusetts metropolitan area to render a final determination of
the
Fair Market Base Rental Rate (the "Arbitrator"). Unless otherwise agreed by
the
parties, the Arbitrator shall be a real estate appraiser or consultant who
shall
be a M.A.I. member and who shall have at least fifteen (15) years continuous
experience in the business of appraising commercial office buildings in the
greater Boston area. The Arbitrator shall conduct such hearings and
investigations as the Arbitrator shall deem appropriate and shall, within sixty
(60) days after having been appointed, choose either the Landlord's
Determination or Tenant's Determination, and that choice by the Arbitrator
shall
be final and binding upon Landlord and Tenant. The party whose Determination
is
not chosen shall pay all the fees and expenses of the Arbitrator. The Arbitrator
shall not have the power to add to, modify or change any of the provisions
of
this Lease.
-2-
(c) In
the
event that the determination of the Fair Market Base Rental Rate set forth
in
the Landlord's Determination and Tenant's Determination shall differ by less
than ten percent (10%) per rentable square foot per annum for each year during
the Extended Term, then the Fair Market Base Rental Rate shall not be determined
by arbitration, but, at Landlord’s election, shall instead be set by taking the
average of the parties' Determinations.
(d) If
for
any reason the Fair Market Base Rental Rate shall not have been determined
prior
to the commencement of the Extended Term, then, until the Fair Market Base
Rental Rate shall have been finally determined, the Basic Rent shall remain
the
same as payable during the last year of the term immediately preceding such
Extended Term. Upon final determination of the Fair Market Base Rental Rate,
an
appropriate adjustment to the Basic Rent shall be made reflecting such final
determination and Landlord or Tenant, as the case may be, shall promptly refund
or pay to the other any overpayment or deficiency, as the case may be, in the
payment of Basic Rent from the commencement date of the Extended Term to the
date of such final determination.
(e) Time
is
of the essence of this Section 15. 1.
ARTICLE
XVI
TENANT
IMPROVEMENTS
Landlord
shall repaint the space and recarpet where there is existing carpet. Tenant
shall be responsible for removing any furniture/cubicles in order for Landlord
to install the carpet.
In
addition, Landlord shall remove the conference room and adjacent office located
in the office portion of the space. (See Attached Exhibit A)
AMENDMENT:
Replace
Section 1.2 Basic Data in Original Lease with the following:
SECTION
1.2 BASIC DATA.
|
Landlord:
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Baltic
Westborough, LLC as successor to
Xxxxxx
X. Xxxxxxx as Trustee of MAT Realty Trust
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Landlord's
Address:
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c/o
The Baltic Group, LLC
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0000
Xxxxxx Xxxx, Xxxxx 00
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|
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Xxxxxxxxxx,
XX 00000
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|
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Tenant:
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Viking
Systems, Inc.
|
|
|
|
|
Tenant's
Address:
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000
Xxxxxxxx Xxxx
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|
Xxxxxxxxxxx,
XX
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|
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Guarantor:
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NA
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Basic
Rent:
For the
first, second and third year of the Extended Term, the sum of Two Hundred and
Forty-Five Thousand Eight Hundred and Thirty-Five Dollars and 00/100
($245,835.00) per annum or $13.50 per square foot of Premises Rentable Area;
as
the same may be adjusted and/or abated pursuant to Section 12.1. If the Term
of
this Lease includes any partial calendar month after the Commencement Date
and
before the beginning of Lease Year 1, Basic Rent shall be payable during such
partial calendar month at the rate applicable during Lease Year
1.
-3-
Monthly
Rent Payment:
For
Lease Year 1, 2 and 3, $20,486.25 per month
Premises
Rentable Area:
Approximately 18,210 of rentable square feet located on the 1st floor of the
Building.
Permitted
Uses: General
office, exclusive however of an office use that would cause or result in the
Premises being deemed "a place of public accommodation" as defined in the
Americans with Disabilities Act of 1990, as amended (the "Disabilities
Act").
Tenant’s
Proportionate Share:
31.95%,
as computed in accordance with the Percentage Share Computation.
Extended
Term: Three
(3)
years commencing on October 1, 2007 and expiring at the close of the day on
September 30, 2010.
Security
Deposit: $26,730.00
- Two Months Rent
Parking:
Non-exclusive
use of 60 spaces in the Building parking lot, to be used in common with other
tenants, guests, employees, invitees and others entitled to the use
thereof.
ARTICLE
XV
OPTIONS
TO EXTEND
15.1 TENANT'S
OPTIONS.
(a)
Provided that, at the time of such exercise, this Lease is still in full force
and effect without an Event of Default by Tenant and Tenant occupies at least
seventy-five percent (75%) of the Rentable Area of the Premises for its own
business purposes, Tenant shall have the right and option (the "Second Extension
Option") to extend the Term of this Lease for One (1) extended term of Three
(3)
years ("Second Extended Term"). The Second Extended Term shall commence on
the
day immediately succeeding the expiration date of the Extended Term, and shall
end on the day immediately preceding the third anniversary of the first day
of
such Extended Term. Tenant shall exercise its Second Extension Option for the
Second Extended Term by giving written notice to Landlord of its desire to
do so
not later than six (6) months prior to the expiration date of the Initial Term.
The giving of such notice by Tenant shall automatically extend the Term of
this
Lease and an instrument of renewal will be executed. In the event that Tenant
fails to give such notice to Landlord this Lease shall automatically terminate
at the end of the Extended Term, and Tenant shall have no further option to
extend the Term of this Lease. The Extended Term shall be on all the terms
and
conditions of this Lease, except (i) during any Second Extended Term, the
extension provisions of this Section to the extent already exercised shall
not
be effective, (ii) that the Basic Rent in effect for the Extended Term shall
be
at the greater of (a) the then current Basic Rent during the last lease Year
of
the Initial Term and (b) the anticipated fair market rental rate for comparable
buildings in the Westborough area for the Premises Rentable Area during the
Extended Term (the "Prevailing Fair Market Base Rental Rate") determined as
follows. Within twenty (20) days of Tenant's exercise of its Extension Option,
Landlord agrees to provide Tenant with Landlord's determination ("Landlord's
Determination") of the Fair Market Base Rental Rate. Any determination of the
Fair Market Base Rental Rate, whether by Landlord or Tenant, shall include
a
statement of the elements of rent included in such determination (whether tenant
improvement allowances, free rent, common area cost allowances, or otherwise)
sufficient to permit a calculation of the effective rent for the
Premises.
-4-
(b) If
Tenant
does not agree with Landlord's Determination, provide Landlord with notice
of
its determination of the Fair Market Base Rental Rate ("Tenant's Determination")
within twenty (20) days of Tenant's receipt of Landlord's Determination; if
Tenant fails to provide Landlord on a timely basis with Tenant's notice to
terminate as aforesaid or Tenant's Determination as set forth herein, Tenant
will be deemed to have agreed to Landlord's Determination which then shall
constitute the basis for determining the Base Rent for the Extended Term. Except
as set forth in subparagraph (c) below, if Landlord's Determination and Tenant's
Determination are different and Landlord and Tenant are unable to agree upon
the
Fair Market Base Rental Rate within thirty (30) days of Landlord's receipt
of
Tenant's Determination, the parties shall within fifteen (15) days after the
end
of such 30-day period, together appoint a mutually acceptable arbitrator or,
if
they are unable to agree upon such an arbitrator, shall apply to the American
Arbitration Association for the designation of an arbitrator located in the
Boston, Massachusetts metropolitan area to render a final determination of
the
Fair Market Base Rental Rate (the "Arbitrator"). Unless otherwise agreed by
the
parties, the Arbitrator shall be a real estate appraiser or consultant who
shall
be a M.A.I. member and who shall have at least fifteen (15) years continuous
experience in the business of appraising commercial office buildings in the
greater Boston area. The Arbitrator shall conduct such hearings and
investigations as the Arbitrator shall deem appropriate and shall, within sixty
(60) days after having been appointed, choose either the Landlord's
Determination or Tenant's Determination, and that choice by the Arbitrator
shall
be final and binding upon Landlord and Tenant. The party whose Determination
is
not chosen shall pay all the fees and expenses of the Arbitrator. The Arbitrator
shall not have the power to add to, modify or change any of the provisions
of
this Lease.
(c) In
the
event that the determination of the Fair Market Base Rental Rate set forth
in
the Landlord's Determination and Tenant's Determination shall differ by less
than ten percent (10%) per rentable square foot per annum for each year during
the Extended Term, then the Fair Market Base Rental Rate shall not be determined
by arbitration, but, at Landlord’s election, shall instead be set by taking the
average of the parties' Determinations.
(d) If
for
any reason the Fair Market Base Rental Rate shall not have been determined
prior
to the commencement of the Second Extended Term, then, until the Fair Market
Base Rental Rate shall have been finally determined, the Basic Rent shall remain
the same as payable during the last year of the term immediately preceding
such
Second Extended Term. Upon final determination of the Fair Market Base Rental
Rate, an appropriate adjustment to the Basic Rent shall be made reflecting
such
final determination and Landlord or Tenant, as the case may be, shall promptly
refund or pay to the other any overpayment or deficiency, as the case may be,
in
the payment of Basic Rent from the commencement date of the Second Extended
Term
to the date of such final determination.
(e) Time
is
of the essence of this Section 15. 1.
ARTICLE
XVI
TENANT
IMPROVEMENTS
Landlord
shall repaint the Tenant’s stock room and clean room in a mutually agreeable
color. In addition, Landlord shall have the stock room floors stripped, cleaned
and polished. Landlord will have all tile floors stripped, cleaned, and
polished. It shall be the Tenant’s responsibility to move all equipment, files,
etc. from the impacted areas so as to not impact the work to be
completed.
It
is further agreed and acknowledged that notwithstanding language contained
in
the Original Lease, that this lease shall now be treated as a gross lease with
Tenant being responsible for the payment of its separately metered utilities
and
its proportionate share of any increases in base operating expenses and real
estate taxes as outlined in Exhibit A attached hereto.
-5-
It
is hereby understood that the above listed paragraphs are the only paragraphs
amended from the Original Lease. All other provisions of the original Lease
unless amended
hereby or by previous Amendments, are hereby confirmed to remain in full force
and effect.
IN
WITNESS WHEREOF,
the
parties have executed this First Amendment to the Office Building Lease on
the
date first set forth above.
WITNESS:
/s/ Xxxxx Xxxxxxx
Baltic
Westborough, LLC
By:
/s/ Xxxxx
X.
Xxxxxxx
Xxxxx
X.
Xxxxxxx, Managing Partner
The
Baltic Group, LLC
Managing
Partner
WITNESS:
/s/ Xxxx Xxxxxxx
Viking
Systems, Inc.
By:
/s/ Xxxxxx
Xxxxxxx
Xxxxxx
Xxxxxxx
VP
and
General Manager
-6-
EXHIBIT
“A”
000
Xxxxxxxx Xxxx, Xxxxxxxxxxx, XX
Base
Operating Costs
for
Leases written in 2006
Operating
Costs Per Square Foot
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A:
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OPERATING
EXPENSES
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PER
SQUARE FOOT
|
||
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INSURANCE:
|
*
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$
|
||
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ELECTRICITY
(Common Area):
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*
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$
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||
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WATER
& SEWER:
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*
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$
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||
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CONTRACT
CLEANING: (incl. windows)
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*
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$
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||
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SERVICE
SUPPLIES:
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*
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$
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||
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GROUNDS
CARE:
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*
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$
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||
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SNOW
REMOVAL:
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*
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$
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||
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TRASH
REMOVAL:
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*
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$
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||
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ELEVATOR
MAINTENANCE:
|
*
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$
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||
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|
||||
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TOTAL
OPERATING EXPENSES
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||||
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*
|
$
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Base
Operating Costs
|
*
Operating Expenses for the Calendar Year 2006 will be inserted when
available.
B: REAL
ESTATE TAX
**
$ Base
Real
Estate Taxes
**
Real Estate Taxes for the Fiscal Year 2006 will be inserted when
available
