LEASE
BY
WAKEFIELD READY MIXED CONCRETE CO., INC.
TO
FOCUS ENHANCEMENTS, INC.
Dated: December 1, 1998
TABLE OF CONTENTS
Page
1. IDENTIFICATIONS.......................................................... 1
3. THE BUILDING AND COMMON AREAS............................................ 1
4. TENANT IMPROVEMENTS...................................................... 2
5. TERM..................................................................... 3
6. USE OF THE PREMISES; LICENSES AND PERMITS................................ 3
7. BASIC RENT; ADDITIONAL RENT.............................................. 3
8. TAXES.................................................................... 6
9. INSURANCE; WAIVERS OF SUBROGATION........................................ 8
10. UTILITIES............................................................... 9
11. REPAIRS AND MAINTENANCE................................................. 10
12. COMPLIANCE WITH LAWS AND REGULATIONS.................................... 10
13. ALTERATIONS BY TENANT; SIGNAGE.......................................... 11
14. LANDLORD'S ACCESS....................................................... 11
15. INDEMNITIES............................................................. 12
16. CASUALTY DAMAGE......................................................... 12
17. CONDEMNATION............................................................ 13
18. LANDLORD'S COVENANT OF QUIET ENJOYMENT.................................. 14
19. TENANT'S OBLIGATION TO QUIT; HOLDOVER................................... 14
20. TRANSFERS OF TENANT'S INTEREST.......................................... 15
21. TRANSFERS OF LANDLORD'S INTEREST........................................ 16
22. MORTGAGEES' RIGHTS...................................................... 16
23. TENANT'S DEFAULT; LANDLORD'S REMEDIES................................... 17
24. REMEDIES CUMULATIVE; WAIVERS............................................ 18
25. BROKER.................................................................. 18
i
26. NOTICES................................................................. 19
27. ESTOPPEL CERTIFICATE.................................................... 19
28. BIND AND INURE; LIMITED LIABILITY OF LANDLORD........................... 19
29. CAPTIONS................................................................ 20
30. INTEGRATION............................................................. 20
31. SEVERABILITY; CHOICE OF LAW............................................. 20
32. ENFORCEMENT OF RIGHTS................................................... 20
33. TENANT COVENANT AGAINST HAZARDOUS MATERIALS............................. 20
34. RECORDING............................................................... 21
35. [SECURITY DEPOSIT] TO BE DETERMINED..................................... 21
36. OPTION TO EXTEND........................................................ 22
ii
LEASE
1. Identifications
This Lease is made as of December 1, 1998, by and between WAKEFIELD
READY MIXED CONCRETE CO., INC., a Massachusetts corporation, having an address
at One New Salem Street, P. 0. Xxx 000, Xxxxxxxxx, Xxxxxxxxxxxxx 00000
("Landlord") and FOCUS ENHANCEMENTS, INC., a Delaware corporation, having an
address at 000 Xxxxx Xxxx, Xxxxxxx, Xxxxxxxxxxxxx 00000 ("Tenant").
2. The Premises: Parking
In consideration of the Basic Rent, Additional Rent, and other payments
and covenants of Tenant hereinafter set forth, and upon the following terms and
conditions, Landlord hereby leases to Tenant and Tenant hereby leases from
Landlord approximately 22,725 rentable square feet of floor space (measured by
BOMA/ANSI Standards), located as shown on the floor plan attached hereto as
Exhibit A-1 (the "Premises"), in a certain building (the "Building"), which has
been constructed by Landlord, on a certain parcel of land containing
approximately 18.6 acres located at 000 Xxxxxxxx Xxxxx, Xxxxxxxxxx,
Xxxxxxxxxxxxx (the "Property"), said land is more particularly described in
Exhibit A hereto. The Premises are leased together with rights, in common with
Landlord and all others (including any other tenant or tenants of the Building
or the Property) claiming under Landlord or otherwise from time to time lawfully
entitled thereto, to use the Common Areas, as hereinafter defined, for their
intended purposes. Tenant shall have access free of charge to a minimum of three
(3) unassigned parking spaces per one thousand (1,000) rentable square feet of
floor space provided that Landlord shall designate four (4) of such parking
spaces in the vicinity of the main entrance to the leased premises at "FOCUS
RESERVED" and Landlord shall also designate three (3) of such parking spaces in
the vicinity of the main entrance for the use of Tenant's visitors. Landlord
shall have no responsibility, however, to enforc said parking restrictions.
3. The Building and Common Areas
The Building is a single story brick and glass structure containing
approximately 100,256 rentable square feet of floor space.
The Common Areas shall consist of (i) the common entrance area(s) and
all other such common areas of the Building and (ii) the driveways, walkways,
parking areas and other common areas of the Property. Landlord reserves the
right to alter the Common Areas from time to time during the Term (as
hereinafter defined) provided that no alteration shall (i) reduce the minimum
number of Tenant's parking spaces specified in Section 2 above, or (ii)
materially alter the Premises as improved by the Tenant Improvements (as
hereinafter defined), without written consent of Tenant).
4. Tenant Improvements
On the Commencement Date, Landlord shall deliver the Premises to Tenant
in accordance with the plans and specifications attached hereto as Exhibit B
("Tenant Improvements"). Landlord shall cause the Tenant Improvements to be
completed as soon as practicable but in no event later than February 1, 1999, in
(i) a good and workmanlike manner, (ii)<-1- 95>in accordance with the plans and
specifications for Tenant Improvements, (iii) using first-class materials, (iv)
with no negligence or defects in the design, materials or workmanship, (v) free
and clear of mechanics' liens, and (vi) except as otherwise permitted under
variances or other deviations duly obtained, in compliance with all applicable
laws, by-laws, ordinances, codes, rules, regulations, orders and other lawful
requirements of governmental bodies having jurisdiction.
The Tenant's Improvements shall be deemed to be complete when (i) the
Premises are in clean condition, free of all debris, rubbish and building
materials; (ii) a temporary or permanent certificate of occupancy has been
issued for the Premises by the appropriate governmental authority; and (iii) all
other governmental approvals for occupancy of the Premises have been obtained.
For twelve (12) months after the date the Premises are completed,
Landlord shall promptly remedy any defect of materials or workmanship in or
affecting the Tenant Improvements, if reasonably practicable, within ten (10)
business days of when Tenant gives notice of such defect to Landlord within
twelve (12) months after the date the Premises are completed. Tenant shall
receive the benefit of any Construction Warranties obtained by Landlord with
respect to areas of the Premises or Tenant Improvements to be maintained and
repaired by Tenant hereunder. Otherwise, any warranty made by any person in
connection with the construction of the Premises and Tenant Improvements or as
to any materials, equipment of other items contained and incorporated herein
shall inure to the benefit of and be deemed to have been made to Landlord,
copies of which shall be delivered to Tenant. Landlord shall (i) assign to
Tenant all warranties, causes of action or claims, whether in contract or in
tort, that Landlord has with respect to the portions of the Premises to be
maintained by Tenant hereunder; and (ii) assign to Tenant all permits and
governmental approvals issued to Landlord for portions of the Premises to be
maintained or repaired by Tenant. Landlord shall inform Tenant of all written
construction and equipment warranties existing in favor of Landlord which relate
to or affect the Premises or Tenant Improvements (the "Construction Warranties")
and shall cooperate with Tenant in enforcing the Construction Warranties and (to
the extent Landlord has the right to do so) in bringing any suit that may be
necessary to enforce the rights of Landlord and Tenant thereunder.
Tenant and Tenant's representatives may enter the Premises commencing
upon execution of this Lease in order to (i) inspect the status of construction,
and (ii) install trade fixtures, data and telecommunications equipment and other
necessary equipment in the Premises provided such installation does not
interfere with Landlord's installation of the Tenant Improvements, and such
entry shall be subject to all of the terms and conditions of this Lease, except
that such entry shall not be deemed to commence Tenant's obligation to pay Basic
Rent or Additional Rent due hereunder prior to the date on which the same is to
commence as hereinafter provided, unless Tenant commences to use the Premises
for Tenant's normal business activities therein.
2
Landlord acknowledges and agrees that Tenant shall have the right to
install an electricity generator at Tenant's expense in a mutually agreeable
location on or near the Premises provided that Tenant shall have first obtained
any permits or approvals required by law in connection therewith.
5. Term
The term of this Lease (the "Term") shall commence on February 1, 1999,
or such earlier date agreed to by the parties if completion of the Tenant's
Improvements in accordance with Section 4 above has occurred (the "Term
Commencement Date") and shall expire, unless earlier terminated in accordance
with the terms hereof, at 5:00 p.m. on the last day of the month which is two
(2) months after the fifth anniversary of the Term Commencement Date. Each
calendar year or portion thereof following the Term Commencement Date shall be
defined as a "Lease Year."
6. Use of the Premises; Licenses and Permits
Tenant shall use the Premises only for general office, engineering,
research and development, purchasing, light packaging, warehousing and
distribution purposes, to the extent now and hereafter from time to time
permitted under applicable laws, by-laws, ordinances, codes, rules, regulations,
orders and other lawful requirements of governmental bodies having jurisdiction.
Tenant, any permitted subtenants, licensees, invitees and any other users of the
Premises shall apply in their own names for and obtain at their own expense any
and all licenses, permits and other approvals which may be required from
governmental bodies in connection with any particular use of the Premises during
the Term.
7. Basic Rent; Additional Rent
a.Basic Rent. Tenant shall, beginning on the Rent Commencement Date (as defined
later herein) and throughout the remaining Term, pay basic rent ("Basic Rent")
to Landlord annually in the amount of $196,571.25 ($8.65 per rentable square
foot) during the first two years of the Term, in the amount of $202,252.50 ($
8.90 per rentable square foot) during the third year of the Term and in the
amount of $207,933.75 ($9.15 per rentable square foot) during the fourth and
fifth years of the Term. Beginning on April 1, 1999 ("Rent Commencement Date"),
Basic Rent shall be payable in advance on the first day of each month in equal
monthly installments of $16,380.94 during the first two years of the Term,
$16,854.37 during the third year of the Term and $17,327.81 during the last two
years of the Term, in each case to Landlord at the address set forth above or
such other address as Landlord may hereafter specify by 30 days prior written
notice to Tenant, without counterclaim, set off, deduction or defense except a
otherwise herein expressly stated.
Notwithstanding the commencement date of this Lease, Tenant may occupy
the Premises upon full completion of the Tenant Improvements and production of
all required insurance certificates without obligation for the payment of Base
Rent until the Rent Commencement Date.
3
All other terms, covenants and conditions of this Lease shall apply during any
such rent free period.
(b) Additional Rent. This Lease is intended by the parties hereto to be
a so-called "net" lease, to the end that the Basic Rent shall be received by
Landlord net of all costs and expenses related to the Premises as set forth in
this Lease, and net of Tenant's Share, as hereinafter defined, of all Common
Expenses. The same shall be paid to Landlord upon demand as additional rent
(sometimes referred to as "Additional Rent") in the same manner as Basic Rent.
Tenant's Share is 22.67% (being the ratio of the rentable square footage of the
Premises to the rentable square footage of the Building).
Tenant shall also pay as Additional Rent, promptly upon being billed
therefor by Landlord, any and all charges, costs, expenses, and obligations of
every kind and nature whatever as Landlord may from time to time actually incur
in good faith with regard to the Premises or the operation or maintenance
thereof, except as otherwise expressly agreed in this Lease, including, without
limiting the generality of the foregoing, reasonable attorneys' fees incurred by
Landlord in connection with any amendments to, consents under and subleases and
assignments of this Lease requested by Tenant, other than subleases or
assignments pursuant to Paragraph 20(b) hereof and, following a Default of
Tenant, in connection with the enforcement of rights and pursuit of the remedies
of Landlord under this Lease (whether during or after the expiration or
termination of the Term).
(c) "Common Expenses" shall mean any and all charges, costs and
expenses of every kind and nature whatever, which Landlord may from time to time
incur and the value, based on competitive rates, of any materials and services
which Landlord may reasonably provide in good faith with respect to the
ownership, operation and maintenance of the Building and the Property,
including, without limitation, any and all costs and expenses incurred by
Landlord in connection with: (i) making customary and reasonable repairs to and
undertaking maintenance of the Building (including fire protection sprinkler
systems) or the Property, including interior alterations to the Common Areas of
the Building; (ii) providing utilities, including heat to the Common Areas of
the Building; (iii) providing watering, landscaping and lawn care for the
Property; (iv) sanding, plowing and removal of snow and ice from the driveways,
walkways and parking areas; (v)<-1- 95>lighting for the Property; (vi)
maintaining the insuranc required to be maintained by Landlord pursuant to
Paragraph 8 hereof and (vii) the reasonable annual amortized portion of any
capital replacement cost except to the extent excluded under Subparagraph (d)
below. Landlord's responsibilities for watering, landscaping, lawn care and for
snow removal as provided for herein above shall be completed in a good and
workmanlike manner to maintain a professional appearance. Snow removal shall
include maintaining parking areas and the driveway serving the building in
usable condition for vehicles and pedestrians during snow conditions. Landlord
shall use commercially reasonable efforts to cause. Snow removal shall be
completed by 7:30 A.M. on all non-holiday weekdays. Without limiting the
foregoing, Landlord agrees to seed all bare areas in front of the leased
premises.
4
(d) Exclusions. The following shall not constitute Common Expenses for
the purposes of this Lease; (i) legal fees, brokerage commissions, advertising
costs and other related expenses incurred in connection with the leasing or
ownership of the Building; (ii) repairs, alterations, additions, improvements or
replacements made to rectify or correct any defect in the design, materials or
workmanship of the Building or Common Areas or to comply with any requirements
of any governmental authority in effect as of the effective date of this Lease;
(ii) costs defined by generally accepted accounting principals as capital costs
for repairs and replacements to the structure of the Building, including the
structural steel footings, exterior walls, roof deck, main sprinkler line, roof
membrane, all underground or under slab utilities; (iv) damage and repairs
attributable to condemnation, fire or other casualty; (v) damage and repairs
covered under any warranty or insurance policy carried by Landlord in connection
with the Building or Property; (vi) damage and repairs necessitated by the
negligence or willful misconduct of Landlord or Landlord's employees,
contractors or agents; (vii) executive salaries of Landlord; (viii) salaries of
service personnel to the extent that such service personnel perform services not
solely in connection with the management, operation, repair or maintenance of
the Building or Common Areas; (ix) Landlord's general overhead expenses not
related to the Building; (x) payments of principal or interest on any mortgage
or other encumbrance including ground lease payments and points, commissions and
legal fees associated with financing; (xi) depreciation; (xii) legal fees,
accountants' fees and other expenses incurred in connection with disputes with
Tenant or other tenants or occupants of the Building or associated the
enforcement of any leases or defense of Landlord's title to or interest in the
Building or any part thereof; (xiii) costs (including permit, license and
inspection fees) incurred in renovating or otherwise improving, decorating,
painting or altering space for other tenants or other occupants or vacant space
in the Building; (xiv) costs incurred due to violation by Landlord or any other
tenant in the Building of the terms and conditions of any lease; (xv) the cost
of any service provided to Tenant or other occupants of the Building for which
Landlord is entitled to be reimbursed; (xiv)<-1- 95>charitable or political
contribution; (xvii) any cos or expense related to the testing for removal,
transportation or storage or Hazardous Materials (as defined in Paragraph 33 of
this Lease) from the Property, Building or Premises; (xviii) interest, penalties
or other costs arising out of Landlord's failure to make timely payments of its
obligations; (xix) costs incurred in connection with any portion of the Building
which is used for parking and for which parking fees are charged; (xx) property
management fees of any property management firm in excess of three percent (3%)
of the gross revenues of the Building; and (xxi) costs incurred in advertising
and promotional activities for the Building.
(e) Limitations on Collection. Landlord shall not collect in excess of
one hundred percent (100%) of Common Expenses, or any item of cost more than
once, nor shall Landlord collect more than Tenant's Share of the Common Expenses
from Tenant. Any Common Expenses charged Landlord by any of its affiliates for
goods or services provided to the Building shall not exceed the prevailing cost
thereof that would be charged to Landlord by non-affiliated parties in arm's
length transactions. All Common Expenses shall be directly attributable to the
operations, maintenance, management and repair of the Property and Building and
shall be determined in accordance with generally accepted accounting principles
and practices, consistently applied.
5
(f) Periodic Payment. Tenant shall, upon receipt of written notice from
Landlord, prepay to Landlord monthly as Additional Rent, in the same manner as
Basic Rent, one twelfth (1/12) of the total of all such amounts as Landlord may
from time to time reasonably estimate will be payable annually by Tenant under
this Paragraph 7, which prepayments shall be applied, without interest, to such
amounts as actually become payable.
Within ninety (90) days after the close of each Lease Year, Landlord
shall deliver to Tenant a written statement of Tenant's Share of the Common
Expenses for such Lease Year prepared by Landlord from Landlord's books and
records, in reasonable detail, and computed in accordance with general
accounting principles consistently applied. If on the basis of such statement
Tenant owes an amount that is more or less than the estimated payments for such
calendar year previously made by Tenant, Tenant or Landlord, as the case may be,
shall pay the deficiency to the other party within thirty (30) days after
delivery of the statement. Any such deficiency payable by Tenant shall be
considered Additional Rent for purposes of this Lease.
(g) Audit. Landlord shall keep for a period of at least twelve (12)
months after the expiration of each calendar year, full and accurate books,
records and supporting documents in connection with Landlord's annual statement
of Common Expenses. Tenant shall have the right to challenge the accuracy of any
Common Expenses, and, if Tenant challenges any Common Expenses, Landlord shall
make Landlord's books and supporting documents available to Tenant and Tenant
may inspect the same. The Commo Expenses shall be appropriately adjusted on the
basis of such audit. Landlord's current estimate is that Tenant's Share of
Common Expenses, Taxes (Paragraph 8) and Utilities (Paragraph 10) during the
first 12 months of the Term should not exceed $39,768.75. If Tenant discovers
that Landlord has overstated any Common Expenses and/or Additional Rent payable
under this Agreement, Landlord shall promptly refund the overstated amount, with
interest at the rate of one (1) percent per month and if such overstated amount
is more than 115% of Tenant's Share of Common Expenses, Landlord shall pay
Tenant the reasonable costs of Tenant's audit.
(h) Interest on Late Payment. If any payment of Basic Rent or
Additional Rent is not paid to Landlord within any applicable grace period, then
at Landlord's option, without notice and in addition to all other remedies
hereunder, Tenant shall pay upon demand to Landlord as Additional Rent, interest
thereon at an annual rate of ten percent (10%), to be computed from the date
such Basic Rent or Additional Rent was originally due through the date when paid
in full. Notwithstanding the foregoing, such interest shall not be imposed if
Tenant shall make payment within 10 days after written notice from Landlord that
such payment has not been timely received provided, however, that in no event
shall Landlord be obligated to give more than two such notices in any 12 month
period prior to assessing such interest against Tenant.
8. Taxes
Tenant shall pay or cause to be paid to Landlord throughout the Term
(or, where appropriate, directly to the authority by which the same are assessed
or imposed, with evidence of such payment to Landlord) as Additional Rent not
later than ten (10) days prior to the date the same are due or twenty (20) days
after receipt of written notice thereof to Tenant, whichever is later, all taxes
and excises upon the personal property and equipment of Tenant located at the
6
Premises or the Property and the Tenant Share of the Taxes (as hereinafter
defined) and the entire amount of any interest, penalties and costs attributable
to delayed payment thereof where such delay is the fault of Tenant. "Taxes"
shall mean any and all real estate taxes, betterment and special assessments
(provided that Landlord shall elect to pay any such betterment and special
assessments over the longest period permitted by applicable law) or amounts in
lieu or in the nature thereof and any other taxes, levies, water rents, sewer us
charges and other excises, franchises, imposts and charges, general and special
of whatever name and nature, and whether or not now within the contemplation of
the parties hereto, which may now or hereafter be levied, assessed or imposed by
The Commonwealth of Massachusetts, the Town of Wilmington or any other
non-federal authority, or become a lien, upon all or any part of the Property,
the Building, the Premises, the use or occupation thereof, or upon Landlord and
Tenant in respect thereof, or upon the basis of rentals thereof or therefrom, or
upon the estate hereby created or upon Landlord by reason of ownership of the
reversion.
Notwithstanding the foregoing, none of the following shall constitute
taxes for the purposes of this Lease, and nothing contained herein shall be
deemed to require Tenant to pay any of the following: (i) any state, local,
federal, personal or corporate income tax measured by the income of Landlord;
(ii) any estate, inheritance taxes, or gross rental receipts tax; (iii) any
franchise, succession or transfer taxes; (iv) interest on taxes or penalties
resulting from Landlord's failure to pay taxes; (v) any increases in taxes
attributable to additional improvements to the Building unless such improvements
are constructed for Tenant's sole benefit; (vi) real estate taxes resulting from
overstandard improvements made by other tenants and (vii) any taxes which are
essentially payments to a governmental agency for the right to make improvements
to the Building or surrounding area; provided, however, that if some method or
type of taxation shall replace the current method of assessment of real estate
taxe in whole or in part, or the type thereof, or if additional types of taxes
are imposed upon the Property or Landlord ("New Taxing Method"), Tenant agrees
that such taxes or other charges shall be deemed to be, and shall be, Taxes
hereunder and Tenant shall pay an equitable share of the same as an additional
charge computed in a fashion consistent with the method of computation herein
provided, to the end that Tenant's share thereof shall be, to the maximum extent
practicable, comparable to that which Tenant would bear under the foregoing
provisions. In the event of a New Taxing Method which measures income to
Landlord, Tenant shall have no liability with respect thereto unless such tax
treats income derived from real property differently from income derived from
other sources, and Tenant's share thereof shall be calculated as if the Property
were the only property of Landlord subject to such tax.
Tenant shall, upon receipt of written notice from Landlord, prepay to
Landlord monthly as Additional Rent, in the same manner as Basic Rent,
one-twelfth (1/12) of the total of all such amounts as Landlord may from time to
time reasonably estimate will be payable annually by Tenant under this Paragraph
8, which prepayments shall be applied without interest to such amounts as
actually become payable. As soon as any such amounts so payable are actually
determined, Landlord shall deliver to tenant a written statement thereof, which
shall include copies of the tax bills. Appropriate adjustments of any
overpayment and underpayment shall be made within thirty (30) days after
delivery of the statement.
7
Subject to the rights of any Mortgagees, if Landlord shall receive any
tax refund or reimbursement of Taxes or sum in lieu thereof with respect to any
tax year, then out of any balance remaining thereof after deducting Landlord's
expenses reasonably incurred in obtaining such refund, Landlord shall pay to
Tenant, provided there does not then exist a Default of Tenant, an amount equal
to such refund or reimbursement or sum in lieu thereof (together with Tenant's
share of any interest actually received by Landlord in connection with such
abatement) multiplied by Tenant's share; provided, that in no event, shall
Tenant be entitled to receive more than the payments made by Tenant on account
of Taxes for such tax year pursuant to this paragraph. If a Default of Tenant
exists, then while such Default of Tenant remains outstanding, Landlord may
retain Tenant's share of such refund or reimbursement as security towards the
cure thereof.
9. Insurance; Waivers of Subrogation
Tenant shall, at its own cost and expense, obtain and throughout the
Term shall maintain, with companies qualified to do business in Massachusetts
and reasonably acceptable to Landlord, commercial general liability insurance
(with broad form contractual liability) under which Tenant is named insured and
Landlord (and such other persons as are in privity of estate with Landlord as
may be set out in a notice from time to time) are listed as additional insured
as their respective interests may appear, and insuring on an occurrence basis
against claims for bodily injury, death or property damage occurring to, upon or
about the Premises in limits of $2,000,000 per occurrence /$4,000,000 aggregate
(combined single limit) for bodily injury or death and property damage and
insurance covering contents of, and personal property and trade fixtures located
in, the Premises. Notwithstanding the foregoing, the risk of loss to all
contents of, and personal property and trade fixtures located in, the Premises
is upon Tenant, and Landlord shall have no liability with respect thereto unless
such loss is due to the negligence or willful misconduct of Landlord. The above
commercial general liability insurance policy shall be non-cancelable and
non-amenable with respect to Landlord and Landlord's said designees without
thirty (30) days prior written notice. Tenant shall provide Landlord with
certificates of insurance evidencing the foregoing (but in limits of $1,000,000
per occurrence/$3,000,000 aggregate) and thereafter from time to time at
Landlord's request together with reasonable evidence of umbrella coverage which
increases the limits to $2,000,000 per occurrence/$4,000,000 aggregate. Landlord
acknowledges that Tenant has provided a copy of Tenant's current policy and
agrees that such policy satisfies Landlord's insurance requirements.
Nothing in this Paragraph 9 shall prevent Tenant from carrying any of
the insurance required of Tenant hereunder in the form of a blanket and/or
umbrella insurance policy or policies which cover other properties owned or
operated by Tenant in addition to the Premises.
Landlord shall obtain and throughout the Term shall maintain, with
companies qualified to do business in Massachusetts and reasonably acceptable to
Tenant and any Mortgagees, for the benefit as named insured of Landlord and any
Mortgagees as their respective interests may appear, with losses first payable
to such Mortgagees under a standard mortgagee endorsement: (i) insurance against
lost rentals from the Building for a period of one year; (ii) so-called
"casualty" insurance against loss or damage to the Building and the Tenant
Improvements such as may result from fire and such other casualties as are
normally covered by an "extended coverage"
8
endorsement, such casualty insurance to be in an amount equal to the replacement
cost of the Building; (iii) boiler and machinery insurance on any Building steam
boilers, pressure vessels and pressure piping and miscellaneous electrical
apparatus, engines, pumps, and compressors, fans and blowers, with so-called
"standard blanket coverage" (15 HP and over); and (iv) a policy of commercial
general liability insurance having a combined single limit for bodily injury and
property damage of not less than One and One-Half Million Dollars
($1,500,000.00) per occurrence and general aggregate insurance in an amount of
not less than Two Million Dollars. The policy shall provide coverage for blanket
contractual liability (except for the negligence or willful misconduct of the
non-insured party), premises and personal injury coverage, together with a
cross-liability severability of interest provision. In the case of commercial
general liability insurance, the policy shall also provide for aggregate
coverage at each location and for reinstatement of the aggregate in the event
the limits of the policy are exhausted. Insurance required hereunder shall be
written by companies licensed to do business in the state in which the Premises
are located and have a General Policyholder's rating of at least A8 as set forth
in the most current issue of Best's Insurance Guide.
Landlord and Tenant each hereby release the other from any liability
for any loss or damage to the Building, the Premises or other property and for
injury to or death of persons occurring on the Property or in the Building or
the Premises or in any manner growing out of or connected with Tenant's use and
occupation of the Premises, the Building or the Property or the condition
thereof, whether or not caused by the negligence or other fault of Landlord,
Tenant or their respective agents, employees subtenants, licensees, invitees or
assignees; provided, however, that this release (i) shall apply notwithstanding
the indemnities set forth in Paragraph 15, but only to the extent that such loss
or damage to the Building or other property or injury to or death of persons is
covered (or required by this Lease to be covered) by insurance which protects
Landlord or Tenant or both of them as the case may be; (ii) shall not be
construed to impose any other or greater liability upon either Landlord or
Tenant then would have existed in the absence hereof; and (iii) shall be in
effect only to the extent and so long as the applicable insurance policies waive
subrogation and provide that this release shall not affect the right of the
insured to recover under such policies, which clauses shall be obtained by the
parties hereto whenever available. If waivers of subrogation are not obtainable
under a party's policies or are obtainable only at an additional cost, said
party shall notify the other party which, if it desires to have the waiver of
subrogation, shall pay said additional cost.
10. Utilities
Landlord shall, at Landlord's expense, install separate meters to
measure gas, water, and electricity consumption by the Tenant, in which event
Tenant shall be billed for such water and sewer use charges imposed in respect
of the usage indicated by such meter and Tenant shall, at its own cost and
expense, arrange and pay for such utilities provided to the Premises during the
Term, including, without limitation, electricity (including electricity for air
conditioning), gas, water, telephone service, security and fire protection,
cleaning and trash removal.
9
11. Repairs and Maintenance
(a) Tenant's Obligation. Except as provided in Subparagraph 11(b)
below, during the Term, Tenant, at its own cost and expense, shall: (i) maintain
and make all necessary repairs to the electrical, mechanical, heating,
ventilating and air conditioning, plumbing and other systems inside the Premises
(other than those repairs for which Landlord is responsible as provided
elsewhere in this Lease, e.g., Paragraph 4) and shall maintain a service
contract with respect to the heating, ventilating and air conditioning system
with a company or companies reasonably acceptable to Landlord in connection
therewith; (ii) subject to Paragraph 9, make any repairs to the Building and the
Property necessitated by the acts or negligence of Tenant or its agents,
employees or invitees; (iii) obtain and maintain a service contract for dumpster
service and janitorial services within the Premises with a company or companies
reasonably acceptable to Landlord, and (iv) make all interior non-structural
repairs, replacements and renewals necessary to keep the Premises in as good
condition, order and repair as the same are at the Commencement of the Term or
thereafter may be put, reasonable wear and use and damage by fire or other
casualty only excepted (it being understood, however, that the foregoing
exception for reasonable wear and use shall not relieve Tenant from the
obligation to keep the Premises in good order, repair and condition, free from
accumulation of dirt, rubbish and other debris. Landlord agrees to provide a
suitable location for the dumpster adjacent to or within a reasonable distance
from a rear egress of the Premises.
(b) Landlord's Obligations. From and after the Commencement of and
during the Term Landlord shall make all repairs, replacements and renewals
necessary: (i) to keep in good and sound condition the structure of the
Building, including but not limited to steel, footings, exterior walls, roof
deck, main sprinkler line, roof membrane, and all underground or under-slab
utilities; (ii) to keep the electrical, mechanical, plumbing, sprinkler and
other systems serving the Building generally or the Common Areas in as good
condition, order and repair as the same are at the commencement of the Term or
thereafter may be put; (iii)<-1- 95>to keep the parking areas, driveways,
walkways, and other improvements on the Property in good condition, free of
snow, and sanded as appropriate, and to keep all lawns and landscaped areas of
the Property watered, fertilized and neatly trimmed and (iv) subject to Tenant's
obligations in (a) above, to use commercially reasonable efforts to keep the
Premises free of pests and vermin. Damage by acts or negligence of Tenant or its
agents, employees or invitees shall be charged to Tenant as Additional Rent
hereunder and, without limiting the generality of the foregoing, Tenant shall be
responsible for any loss, cost or damage resulting from activities on the roof
of the Building conducted by Tenant, its agents, employees and contractors which
cause damage to the roof.
12. Compliance with Laws and Regulations
Tenant and Landlord shall, with respect to areas of the Premises under
its sole control, comply, at its own cost and expense, with: (i) all applicable
laws, by-laws, ordinances, codes, rules, regulations, orders, and other lawful
requirements of governmental bodies having jurisdiction, whether or not
foreseeable, and whether or not they involve any changes in governmental policy,
which are applicable to the Premises, the fixtures and equipment therein and
thereon; (ii) all orders, rules and regulations of the National Board of Fire
Underwriters, or any other body hereafter constituted exercising similar
functions, which may be applicable to the
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Premises, the fixtures and equipment therein or thereon or the use thereof; and
(iii) the requirements of all policies of public liability, fire and all other
types of insurance at any time in force with respect to the Premises, the
Building or the Property and the fixtures and equipment therein and thereon.
Without limiting the generality of the foregoing, Tenant shall
continually during the Term of this Lease maintain the Premises in accordance
with all laws, codes and ordinances from time to time in effect and all
directions, rules and regulations of the proper officers of governmental
agencies having jurisdiction, and the standards recommended by the Boston Board
of Fire Underwriters, and shall, at Tenant's expense, obtain all permits,
licenses and the like required by applicable law. To the extent that the
Premises constitute a "Place of Public Accommodation" within the meaning of the
Americans With Disabilities Act of 1990, Tenant shall be responsible for making
the Premises comply with such act provided, however, that Landlord shall be
responsible for making the Premises comply with such act to the extent the
Premises failed to comply therewith on the Term Commencement Date. Landlord is
solely responsible for any exterior or structural modifications which are
required by either law or insurer.
13. Alterations by Tenant; Signage
Tenant shall make no alterations, additions or improvements in or to
any portion of the Premises involving an expenditure in excess of Ten Thousand
Dollars and 00/100 ($10,000.00), or any portion of the Building or the Property
without Landlord's prior written consent, and without first providing Landlord
with suitable assurances that Tenant will complete the same at no expense to
Landlord and without any mechanics' or materialmen's lien upon the Property.
Landlord shall not unreasonably withhold , condition or delay its consent for
interior, non-structural alterations, additions and improvements to the Premises
consistent with the use of the Premises as contemplated hereby; provided that
any such consent to interior, non-structural alterations, additions and
improvements may, at Landlord's election, be conditioned upon Tenant being
obligated to remove the same at the expiration or earlier termination of this
Lease and to restore the Premises to its condition prior to such alterations,
additions and improvements.
Subject to covenants applicable to the Property and the Town of
Wilmington Sign Regulations/By-Laws, Tenant shall be permitted to install its
own exterior building standard signage, as are described in detail in Exhibit C
attached hereto and incorporated herein by reference and Tenant's name shall be
added to the Property directory.
14. Landlord's Access
Tenant shall permit Landlord and any Mortgagees and their authorized
representatives to enter the Premises (i) at all reasonable times during usual
business hours for the purposes of inspecting the same, exercising such other
rights as it or they may have hereunder or under any mortgages and exhibiting
the same to other prospective tenants, purchasers or mortgagees upon at least
twenty-four (24) hours' prior written notice, and (ii) at any time and without
notice in the event of emergency.
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Landlord and any Mortgagee and their respective agents, employees and
contractors shall conduct all of their activities on the Premises in a manner
designed to minimize interference to Tenant and Tenant's use of the Premises.
15. Indemnities
Tenant shall protect, defend (with counsel approved by Landlord in its
reasonable discretion), indemnify and save Landlord harmless from and against
any and all claims and liabilities arising from: (i) the conduct or management
by Tenant or by anyone claiming under Tenant of or from any work or thing
whatsoever done in or about the Premises during the Term by Tenant or by anyone
claiming under Tenant and from any condition existing, or any injury to or death
of persons or damage to property occurring or resulting from an occurrence,
during the Term in or about the Premises; and (ii) any breach or default on the
part of Tenant in the performance of any covenant or agreement on the part of
Tenant to be performed pursuant to the terms of this Lease or from any negligent
act or omission on the part of Tenant or any of its agents, employees,
subtenants, licensees, invitees or assignees, provided however, that Landlord
(i) gives Tenant timely notice of such claim, suit or proceeding and (ii)
assists and cooperates in the defense or settlement of the same in a
commercially reasonable manner. Tenant further agrees to indemnify Landlord from
and against all costs, expenses (including reasonable attorneys' fees) and other
liabilities incurred in connection with any such indemnified claim or action or
proceeding brought thereon, any and all of which, if reasonably suffered, paid
or incurred by Landlord, Tenant shall pay promptly upon receipt of written
demand to Landlord as Additional Rent. Tenant duty to indemnify Landlord under
this Paragraph 15 shall survive the expiration and termination of this Lease
with respect to any claims or liability occurring prior to such expiration or
termination.
Notwithstanding the foregoing, nothing herein shall be deemed to
require Tenant to indemnify, defend, protect or hold Landlord harmless from any
liability, obligations, claims, damages, penalties, cause of action, cost or
expense to the extent caused directly or indirectly by the gross negligence or
willful misconduct of Landlord or Landlord's agents, employees, contractors or
invitees.
Notwithstanding the foregoing, Tenant shall be entitled to a credit
against any sums coming due to Landlord under the foregoing indemnity in an
amount equal to any proceeds of insurance actually received by Landlord (net of
any reasonable costs or expenses incurred by Landlord in connection with
settlement or collection thereof, including reasonable attorneys' fees) with
respect to any matter which is the subject of the foregoing indemnity; provided,
however, that Landlord shall have no obligatio to seek recovery from any insurer
nor shall the foregoing be deemed to impose any obligation upon Landlord to
maintain insurance other than that which is specifically required to be
maintained by Landlord elsewhere in this Lease.
16. Casualty Damage
Except as provided below, in the event of partial or total destruction
of the Premises during the Term by fire or other casualty, Landlord shall, at
its sole expense, as promptly as practicable after receipt of any insurance
proceeds available as a result of such casualty, repair
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(or, in the event such insurance proceeds are not available as a result of
Landlord's failure to maintain property insurance, after such event of fire or
other casualty), reconstruct or replace the portions of the Premises destroyed
to the same condition in which they existed prior to such destruction. During
the period of such repair, reconstruction and replacement and until such time as
Tenant's business may be fully resumed on the Premises, there shall be an
equitable abatement of Basic Rent and Additional Rent in proportion to the loss
of usable floor area in the Premises.
(a) Termination. If the Building or the Premises is so extensively
destroyed by fire or other casualty that the Premises cannot reasonably be
expected to be susceptible of repair, reconstruction or replacement within a
period of one hundred fifty (150) days from the date work were to commence
thereon, either party may terminate this Lease immediately upon notice thereof
to the other and the obligation of Tenant, if any, to pay Basic Rent and
Additional Rent to Landlord shall terminate as of the date of such notice.
Landlord shall notify Tenant within thirty (30) days of such event of damage or
destruction whether the Building or the Premises can be fully repaired or
restored within the one hundred fifty (150) day period. If the Building or the
Premises can be fully repaired or restored within the one hundred fifty (150)
day period, this Lease shall remain in full force and effect, except that Basic
Rent and Additional Rent shall xxxxx as described above, and Landlord shall, and
subject to th rights of any Mortgages, diligently repair and restore the damage
as soon as possible. In the event of any notice of termination pursuant to this
Paragraph 16, this Lease shall terminate as of, and Basic Rent and Additional
Rent shall be appropriately apportioned through and abated from and after, the
date of such notice of termination.
(b) Damage or Destruction at End of Term. If the Building or the
Premises is damaged or destroyed during the last twelve (12) months of the Term
of the Lease, and the Building or the Premises cannot be fully repaired or
restored by Landlord within thirty (30) days after the date of the damage or
destruction, either Landlord or Tenant may terminate this Lease upon notice to
the other, unless Tenant, within 30 days of the date of the fire or other
casualty, elects to exercise its option to extend the Term. Whether or not
terminated hereunder, there shall be an equitable abatement of Basic Rent and
Additional Rent in proportion to the loss of usable floor area in the Premises.
17. Condemnation
If more than ten percent (10%) of the usable floor area of the
Premises, or more than twenty-five percent (25%) of the parking spaces then
available for use by Tenant shall be taken by eminent domain or appropriated by
public authority, Landlord or Tenant may terminate this Lease by giving written
notice to the other within thirty (30) days after such taking or appropriation
unless in the case of a taking of parking spaces, Landlord within thirty (30)
days after any such notice of termination fro Tenant gives written notice to
Tenant of Landlord's assumption of the obligation to replace the parking area so
taken with comparable replacements elsewhere on the Property. In the event of
such a termination, this Lease shall terminate as of the date of Tenant must
surrender possession or, if later, the date Tenant actually surrenders
possession, and the Basic Rent and Additional Rent reserved shall be apportioned
and paid to and as of such date. Whether or not terminated hereunder, there
shall be an equitable abatement
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of Basic Rent and Additional Rent in proportion to the loss of usable floor area
in the Premises and/or parking spaces.
If part of the Premises is taken or appropriated by public authority as
aforesaid and this Lease is not terminated as set forth above, Landlord shall,
subject to the rights of any Mortgagees, apply any such damages and compensation
awarded (net of the costs and expenses, including reasonable attorneys' fees,
incurred by Landlord in obtaining the same) to secure and close so much of the
Premises or other improvements constituting part of the Premises as remain and
shall promptly restore the Building and the Premises to the same condition as
they existed immediately prior to such taking or appropriation; and in such
event this Lease shall continue in full force and effect, except that there
shall be an equitable abatement of Basic Rent and Additional Rent in proportion
to the loss of usable floor area in the Premises after giving effect to such
restoration, from and after the date Tenant must surrender possession or, if
later, the date Tenant actually surrenders possession.
Landlord hereby reserves, and Tenant hereby assigns to Landlord, any
and all interest in and the claims to the entirety of any damages or other
compensation by way of damages which may be awarded in connection with any such
taking or appropriation, except so much of such damages or award as is
specifically and separately awarded to Tenant and expressly attributable to
trade fixtures or moving expenses of Tenant.
18. Landlord's Covenant of Quiet Enjoyment
Landlord covenants that Tenant, upon paying the Basic Rent and
Additional Rent provided for hereunder and performing and observing all of the
other covenants and provisions hereof, may peaceably and quietly hold and enjoy
the Premises for the Term as aforesaid, without hindrance or ejection by any
persons lawfully claiming under Landlord to have title to the Premises superior
to Tenant subject, however, to all of the terms and provisions of this Lease and
to all matters of record; the foregoing covenant of quite enjoyment is in lieu
of any other covenant of quiet enjoyment, express or implied.
19. Tenant's Obligation to Quit; Holdover
Tenant shall, upon the expiration of the Term or earlier termination of
this Lease, leave and peaceably and quietly surrender and deliver to Landlord
the Premises and any replacements or renewals thereof in the order, condition
and repair required by Paragraph 11 hereof and the other provisions of this
Lease, except, however, that Tenant shall first remove any trade fixtures and
equipment and any alterations, additions and improvements which Landlord has
required be removed pursuant to the terms of Paragraph 13 hereof (including any
alterations, additions and improvements, for which Landlord's consent was not
required under Paragraph 13), restoring the Premises in each case to its
condition prior to the installation of such fixtures or the undertaking of such
alterations, additions or improvements, as the case may be, reasonable wear and
tear and damage by casualty or taking excepted.
If Tenant fails to quit the Premises at the expiration of the Term or
earlier termination of this Lease, Tenant shall be a tenant-at-sufferance and
shall pay to Landlord with respect to any
14
holdover period all Additional Rent and a sum equal to 150% of the Basic Rent
("Holdover Rent").
The provisions of this Paragraph 19 shall expressly survive the
expiration or earlier termination of this Lease.
20. Transfers of Tenant's Interest
(a) Except as hereinafter set forth, Tenant covenants and agrees that
whether voluntarily, involuntarily, by operation of law or otherwise neither
this Lease nor the term and estate hereby granted, nor any interest herein or
therein, will be assigned, mortgaged, pledged, encumbered or otherwise
transferred, except as provided by Section 20(b) herein below, and that neither
the Premises nor any part thereof will be encumbered in any manner by reason of
any act or omission on the part of Tenant, or used or occupied or permitted to
be used or occupied, by anyone other than Tenant, or for any use or purpose
other than a Permitted Use, or be sublet (which term, without limitation, shall
include granting of concessions, licenses and the like) in whole or in part, or
be offered or advertised for assignment or subletting without Landlord's prior
written consent, not to be unreasonably withheld, conditioned or delayed.
Without limiting the foregoing, any agreement pursuant to which: (x) Tenant is
relieved from the obligation to pay, or a third party agrees to pay on Tenant's
behalf, all or any portion of Basic Rent, Additional Rent or other charges due
under this Lease; and/or (y) a third party undertakes or is granted the right to
assign or attempt to assign this Lease or sublet or attempt sublet all or any
portion of the Premises, shall for all purposes hereof be deemed to be an
assignment of this Lease and subject to the provisions of this Paragraph 20. The
provisions of this paragraph (a) shall apply to a transfer (by one or more
transfers) of a majority of the stock or partnership interests or other
evidences of ownership of Tenant as if such transfer were an assignment of this
Lease.
Tenant shall reimburse Landlord as Additional Rent, upon receipt of
demand, for any reasonable costs that may be incurred by Landlord in connection
with any proposed assignment or sublease and any request for consent thereto
pursuant to this subparagraph (a), including without limitation the costs of
making investigations as to the acceptability of any proposed assignee or
subtenant and attorneys' fees.
(b) The provisions of paragraph (a) shall not apply to an assignment of
this Lease or sublease of the whole or any portion of the Premises to any
affiliate or subsidiary of Tenant, or to an entity owning Tenant as a
subsidiary, or to any entity resulting from a consolidation or merger of Tenant
with any other entity, or an entity acquiring a majority of Tenant's issued and
outstanding capital stock or a substantial portion of Tenant's physical assets,
provided that in any such event:
(i) Tenant gives Landlord advance written notice
describing the transaction and confirms by written
instrument in form reasonably satisfactory to
Landlord that, notwithstanding the transaction,
Tenant remains bound by all of the obligations of
Tenant hereunder; and
(ii) the assignee agrees directly with Landlord, by
written instrument in form reasonably satisfactory to
Landlord, to be bound by all the
15
obligations of Tenant hereunder including, without
limitation, the covenant against further assignment
and subletting.
21. Transfers of Landlord's Interest
Landlord shall have the right from time to time to sell or mortgage its
interest in the Property, the Building and the Premises, to assign its interest
in this Lease, or to assign from time to time the Basic Rent, Additional Rent or
other sums and charges at any time paid or payable hereunder by Tenant to
Landlord, to any Mortgagees or other transferees designated by Landlord. In any
such case Tenant shall pay the Basic Rent, Additional Rent and such other sums
and charges so assigned, subject to the terms of the Lease, upon receipt from
Landlord of written notice, to such Mortgagees and other transferees at the
addresses mentioned in and in accordance with terms of such instruments of
designation.
22. Mortgagees' Rights
This Lease is and shall be subject and subordinate to any mortgage (and
to any amendments, extensions, increases, refinancing or restructuring thereof)
of the Property, the Building or the Premises, whether such mortgage is filed
prior or subsequent to the execution, delivery or the recording of this Lease or
any notice hereof (the holder from time to time of any such mortgage is
hereinafter called the "Mortgagee"). The foregoing subordination shall be
self-operative and automatically effective a to any existing mortgage or
mortgage filed subsequent to the execution and delivery hereof; provided, that
(i) Landlord shall obtain for the benefit of Tenant an agreement from any future
Mortgagee that, for so long as there exists no default beyond applicable grace
periods under this Lease by Tenant, the Mortgagee will not, in foreclosing
against or taking possession of the Premises or otherwise exercising its rights
under such mortgage, terminate this Lease or disturb Tenant's possession of the
Premises hereunder, or words of similar import and (ii) such subordination shall
not otherwise restrict or limit the rights or increase the obligations of Tenant
under this Lease. Tenant hereby agrees to execute, acknowledge and deliver in
recordable form such instruments confirming and evidencing the foregoing
subordination as Landlord or any such Mortgagee may from time to time reasonably
require.
Provided that Tenant has been provided with written notice of such
mortgage and appropriate addresses to which notice should be sent, no notice
from Tenant of any default by Landlord in its obligations shall be valid, and
Tenant shall not attempt to terminate this Lease, withhold Basic Rent or
Additional Rent or exercise any other remedy which may arise by reason of any
such default, unless Tenant first gives such notice to such Mortgagee and
provides such Mortgagee with reasonable time after suc notice to cure such
default. Tenant shall and does hereby agree, upon default by Landlord under any
mortgage, to attorn to and recognize the Mortgagee or anyone else claiming under
such mortgage, including a purchaser at a foreclosure sale, upon receipt of
written request from a successor to the interest of Landlord under this Lease,
to execute, acknowledge and deliver in recordable form such evidence of this
attornment, and to make payments of Basic Rent and Additional Rent hereunder
directly to the Mortgagee or any such successor, as the case may be, provided
that this Lease shall continue in full force and effect as a direct lease
between such Mortgagee or successor and Tenant. Tenant may comply with the
16
instructions given it by such Mortgagee or successor without the need to verify
Landlord's default under the subject mortgage. Any Mortgagee may, at any time,
by giving written notice to, and without any further consent from, Tenant,
subordinate its mortgage to this Lease, and thereupon the interest of Tenant
under this Lease shall automatically be deemed to be prior to the lien of such
mortgage without regard to the relative dates of execution. delivery or
recording thereof or otherwise.
23. Tenant's Default; Landlord's Remedies
If Tenant shall: (i) default in the payment when due of any Basic Rent,
Additional Rent, or any other charges hereunder, and such default shall continue
for ten (10) days after receipt of written notice from Landlord of such default;
or (ii) if Tenant shall default in the performance or observance of any of the
other covenants contained in this Lease on Tenant's part to be performed or
observed and shall fail, within thirty (30) days after receipt of written notice
from Landlord of such default, to cure such default, or if such cure cannot
reasonably be completed within thirty (30) days, if Tenant fails to commence
such cure within the thirty (30) day period, and thereafter diligently complete
it within sixty (60) days following the end of said thirty (30) day period; or
(iii) if the estate hereby created shall be taken on execution, or by other
process of law or if Tenant shall be found, under Title 11 of the United States
Code as from time to time in effect, or under any applicable law, other than
said Title 11, of any jurisdiction relating to the liquidation or reorganization
of debtors or to the modification or alteration of the rights of creditors, to
be bankrupt or insolvent, or an order by a court of competent jurisdiction shall
be entered approving its liquidation or reorganization or any modification or
alteration of the rights of its creditors (which order is not discharged within
45 days after such entry) or assuming custody of, or appointing a receiver or
other custodian for, all or substantial part of its property (in every such
case, a "Default of Tenant"); then, and in any of said cases, Landlord may, to
the extent permitted by law, immediately or at any time thereafter and without
demand or notice, terminate this Lease and enter into and upon the Premises, or
any part thereof in the name of the whole, and repossess the same as of
Landlord's former estate, and, by any lawful means, expel Tenant and those
claiming through or under Tenant and remove its effects without being deemed
guilty of any manner of trespass, and without prejudice to any remedies which
might otherwise be used for arrears of rent or preceding breach of covenant.
No termination or repossession provided for in this Paragraph 23 shall
relieve Tenant or any guarantor of the obligations of Tenant under this Lease of
or from its liabilities and obligations under this Lease, all of which shall
survive any such termination or repossession. In the event of any such
termination or repossession, Tenant shall pay to Landlord either: (i) in advance
on the first day of each month, for what would have been the entire balance of
the Term one-twelfth (1/12) (and a pro rata portion thereof for any fraction of
a month) of the annual Basic Rent, Additional Rent and all other amounts for
which Tenant is obligated hereunder, less, in each case, the actual net receipts
by Landlord by reason of any reletting of the Premises after deducting
Landlord's expenses in connection with such reletting, including, without
limitation, removal, storage and repair and renovation costs and reasonable
brokers' and attorneys' fees; or (ii) at the option of Landlord exercisable by
Landlord's giving notice to Tenant within thirty (30) days after any such
termination, an amount equal to the amount by which the payments of Basic Rent
and Additional Rent reasonably estimated to be payable for the balance of the
Term after
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the date of the exercise of said option would exceed the payments reasonably
estimated to be the fair rental value of the Premises over such period,
determined as of such date. Landlord will use reasonable efforts to mitigate its
damages.
Without thereby affecting any other right or remedy of Landlord
hereunder, Landlord may, at its option, cure for Tenant's account any default by
Tenant hereunder which remains uncured after said thirty (30) days' notice of
default from Landlord to Tenant, and the cost to Landlord of such cure shall be
deemed to be Additional Rent and shall be paid to Landlord by Tenant with the
installment of Basic Rent next accruing, together with interest thereon, from
the date so expended until the date repaid at the annual rate of ten percent
(10%). Without thereby affecting any other right or remedy of Landlord
hereunder, Landlord may, at its option, charge Tenant a late charge in the
amount of five percent (5%) of the amount overdue in connection with any Basic
Rent or Additional Rent not paid within five (5) days of the date when due.
Notwithstanding the foregoing, in the event Tenant wishes to contest a payment
to be made by Tenant to a third party and provided that Tenant has provided
Landlord with security or other assurances reasonably satisfactory to Landlord
that such contest shall have no adverse effect on Landlord or the Property,
Landlord shall forbear exercising the rights set forth in this grammatical
paragraph with respect to such payment while such contest is undertaken.
24. Remedies Cumulative; Waivers
Except as stated otherwise herein, the specific remedies to which
either party may resort under the terms of this Lease are cumulative and are not
intended to be exclusive of any other remedies or means of redress to which that
party may be lawfully entitled under any provision of this Lease or otherwise.
The failure of Landlord or Tenant to insist in any one or more instances upon
the strict performance of any of the covenants of this Lease shall not be
construed as a waiver or relinquishment fo the future of such covenant. A
receipt by Landlord, or payment by Tenant, of Basic Rent or Additional Rent with
knowledge of the breach of any covenant hereof shall not be deemed a waiver of
such breach, and no waiver, change, modification or discharge by Landlord or
Tenant of any provision in this Lease shall be deemed to have been made or shall
be effective unless expressed in writing and signed by an authorized
representative of Landlord or of Tenant, as the case may be. In addition to the
other remedies in this Lease provided, Landlord or Tenant, as the case may be,
shall be entitled to the restraint by injunction of the covenants, conditions or
provisions of this Lease, or to a decree compelling performance of or compliance
with any of such covenants, conditions or provisions.
25. Broker
Tenant warrants and represents that it has not dealt with any real
estate broker other than CB/Xxxxxxx Xxxxx Whittier Partners and Xxxxxxxx & Grew,
Incorporated (the "Brokers") in connection with the Premises or this Lease. Full
payment to the Brokers will be made by Landlord pursuant to a separate
agreement. Tenant shall indemnify and hold Landlord harmless from and against
any liability for commissions due any real estate broker or finder other than
the Broker with whom Tenant has dealt in connection with this Lease.
18
26. Notices
Any notices or other communications hereunder shall be in writing and
delivered by hand or mailed, postage prepaid, by registered or certified mail,
return receipt requested, or delivered by generally-recognized overnight
delivery service, if to Landlord at the address first set forth above, if to
Tenant at the address first set forth above, and if to any Mortgagee at such
address as it may specify by such written notice to Landlord and Tenant, or at
such other address as any of them may from xxx to time specify by like notice to
the others. Any such notice shall be deemed given when personally delivered or,
if mailed, three business days after having been mailed as herein provided,
unless mailed by generally-accepted overnight delivery service, in which case
notice shall be deemed given one business day after having been so mailed.
27. Estoppel Certificate
Each party shall, from time to time, within twenty (20) days after
receipt of written request from the other party or any Mortgagee, execute,
acknowledge and deliver, without charge, to the other party, the Mortgagee or
any other person designated, a statement in writing certifying: (i) that this
Lease is unmodified and in full force and effect (or if there have been
modifications, identifying the same by the date thereof and specifying the
nature thereof); (ii) that, to the knowledge of the certifying party, there
exist no defaults (or if there be any defaults, specifying the same); (iii) the
amount of the Basic Rent, the dates to which the Basic Rent, Additional Rent and
other sums and charges payable hereunder have been paid; (iv) that, to the
knowledge of the certifying party, there exist no claims against the other party
hereunder except for the continuing obligations under this Lease (or if the
certifying party has any such claims, specifying the same); and (v) such other
matters as the requesting party or the Mortgagee may reasonably request.
28. Bind and Inure; Limited Liability of Landlord
All of the covenants, agreements, stipulations, provisions, conditions
and obligations herein expressed and set forth shall be considered as running
with the land and shall extend to, bind and inure to the benefit of Landlord and
Tenant, which terms as used in this Lease shall include their respective
successors and assigns where the context hereof so admits.
Neither Landlord nor any principal of Landlord shall have any
individual or personal liability for the fulfillment of the covenants,
agreements and obligations of Landlord hereunder, Tenant's recourse and
Landlord's liability hereunder being limited to the Property and the Building
and the rents accruing therefrom. The term "Landlord" as used in this Lease
shall refer to the owner or owners from time to time of the Property or the
Building, it being understood that no such owner shall have any liability
hereunder for matters arising from and after the date such owner ceases to have
any interest in the Property or the Building, provided that the successor to
such owner expressly assumes in writing the covenants, agreements and
obligations of Landlord hereunder. Landlord shall in no event be in default in
the performance of any of Landlord's obligations hereunder unless and until
Landlord shall have failed to perform such obligations within thirty (30) days,
or if such failure is of such a natur that Landlord cannot reasonably remedy the
same within such thirty (30) day period, Landlord shall fail to commence
promptly
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(and in any event within such thirty (30) day period) to remedy the same and to
prosecute such remedy to completion with diligence and continuity.
29. Captions
The captions for the numbered paragraphs of this Lease are provided for
reference only and they do not constitute a part of this agreement or any
indication of the intentions of the parties hereto.
30. Integration
All prior written and oral agreements between the parties and all prior
representations made by either party to the other with respect to the subject
matter hereof have been incorporated in this instrument or otherwise satisfied
prior to the execution hereof.
31. Severability; Choice of Law
If any provision of this Lease shall be declared to be void or
unenforceable either by law or by a court of competent jurisdiction, the
validity or enforceability of remaining provisions shall not thereby be
affected. This Lease is made under, and shall be construed in accordance with,
the laws of The Commonwealth of Massachusetts.
32. Enforcement of Rights
All reasonable costs or expenses, including reasonable attorneys' fees,
incurred by Landlord in connection with amendments to, consents under and
subleases and assignments of this Lease (other than assignments or subleases
described in Paragraph 20(b) above) shall be paid by Tenant to Landlord upon
receipt of written demand. All reasonable costs or expenses, including
reasonable attorney's fees, incurred by Tenant in connection with amendment to
and consents under this Lease requested by Landlord shall be paid by Landlord to
Tenant upon receipt of written demand. All reasonable costs or expenses,
including reasonable attorneys' fees, incurred by a party in enforcing its
rights or remedies hereunder, whether during or after the expiration or
termination of the term, shall be paid by the party prevailing in such
enforcement of rights and remedies. Moreover, if either party hereto is, without
fault on its own part, made a party to any action instituted by or against the
other party to this Lease du to such other party's fault, such other party shall
indemnify the party innocently involved and save it harmless against and from
all such cost and expense incurred therein including, without limitation,
reasonable attorneys' fees.
33. Covenants Regarding Hazardous Materials
Tenant shall not cause or allow any of its employees, agents,
customers, visitors, invitees, licensees, contractors, assignees or subtenants
(collectively "Tenant's Parties") to cause any Hazardous Materials to be brought
on to, used, generated, stored or disposed of, on or about the Property. Tenant
shall indemnify, defend by counsel reasonably acceptable to Landlord, protect
and hold Landlord harmless from and against all liabilities, losses, costs and
expenses, demands,
20
causes of action, claims, or judgments directly or indirectly arising out of (i)
the violation of the foregoing covenant or (ii) the use, generation, storage or
disposal of Hazardous Materials by Tenant or any of Tenant's Parties on the
Property. Tenant's obligations pursuant to the foregoing indemnity shall survive
the termination of this Lease. Hazardous Materials shall include but not be
limited to those substances defined as "hazardous substances," "toxic
substances," "pollutants" or "contaminants' in the Comprehensive Environmental
Response, Liability and Recovery Act, as amended ("CERCLA"), 42 U.S.C. Section
9601 et seq., the Hazardous Materials Transportation Act, 49 U.S.C. Section
1802, the Resources Conservation and Recovery Act of 1976 ("RCRA"), 42 U.S.C.
Section 6901, et seq or Massachusetts Common Laws Chapter 21E.
34. Recording
Tenant agrees not to record this Lease, but, if the Term of this Lease
(including any extended term) is seven (7) years or longer, each party hereto
agrees, on the request of the other, to execute a so-called notice of lease in
recordable form and complying with applicable law and reasonably satisfactory to
Landlord's attorneys. In no event shall such document set forth the rent or
other charges payable to Tenant under this Lease; and any such document shall
expressly state that it is executed pursuant to the provisions contained in this
Lease, and is not intended to vary the terms and conditions of this Lease.
35. (a) A security deposit equal to $49,142.82 [three (3) months Basic Rent]
will be paid upon execution and delivery of this Lease, and Landlord shall hold
the same throughout the Term of this Lease as security for the performance by
Tenant of all obligations on the part of Tenant hereunder and under any other
leases or occupancy agreements that may hereafter be entered into between
Landlord and Tenant relative to the Property. Landlord shall have the right from
time to time without prejudice to an other remedy Landlord may have on account
thereof, to apply such deposit, or any part thereof, to Landlord's damages
arising from, or to cure, any default of Tenant hereunder or under any other
such lease or occupancy agreement. If Landlord shall so apply any or all of such
deposit, Tenant shall immediately deposit with Landlord the amount so applied to
be held as security hereunder. If at the expiration of the Term and surrender of
the Premises in accordance with this Lease there then exists no Default of
Tenant (or event or circumstances which, with the passage of time or the giving
of notice, or both, would constitute a Default of Tenant), Landlord shall return
the deposit, or so much thereof as shall have theretofore not been applied in
accordance with the terms of this Paragraph 35, to Tenant within ten (10)
business days of such surrender. While Landlord holds such deposit, Landlord
shall hold the same in a separate account in a Massachusetts bank, and shall
credit to Tenant's account the amount o any interest actually paid by such bank
with respect thereto (after deducting any fees or other charges imposed on
Landlord in respect of such account). Tenant hereby certifies that it is aware
that the Federal Deposit Insurance Corporation ("FDIC") coverages apply only to
a cumulative maximum amount of $100,000 for each individual deposit for all of
depositor's accounts at the same or related institution. Further, Tenant agrees
that Landlord assumes no responsibility for, nor will Tenant hold Landlord
liable for, any loss occurring with arises from the fact that the amount of the
security deposit exceeds $10,000 or from the fact that the excess amount will
not be insured by FDIC, or that FDIC insurance is not available on certain types
of bank instruments. If Landlord conveys Landlord's interest under this Lease,
the deposit, or any part thereof not
21
previously applied, shall be turned over by Landlord to Landlord's grantee, and,
if so turned over, Tenant agrees to look solely to such grantee for prope
application of the deposit in accordance with the terms of this Paragraph 35,
and the return thereof in accordance herewith. The holder of a mortgage shall
not be responsible to Tenant for the return or application of any such deposit,
whether or not it succeeds to the position of Landlord hereunder, unless such
deposit shall have been actually received in hand by such holder.
36. Option to Extend
(a) Provided that, at the time of such exercise, (i) there exists no
Default of Tenant; (ii) this Lease is still in full force and effect; and (iii)
Tenant shall not have assigned this Lease or sublet any or all of the Premises
(except as permitted pursuant to Paragraph 20(b), Tenant shall have the right to
extend the Term of this Lease as to the Premises originally leased hereunder for
one extended term (the "Extended Term") of five (5) years. The Extended Term
shall commence on the day immediately following the expiration date of the
Initial Term, and shall end on the day immediately preceding the fifth
anniversary of the first day of the Extended Term. Tenant shall exercise such
option by giving Landlord written notice of its desire to do so, not later than
twelve (12) months prior to the expiration of the Initial Term, it being agreed
that time shall be of the essence with respect to the giving of such notice. The
giving of such notice shall automatically extend the Term of this Lease for the
Extended 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, the Term of this Lease shall automatically terminate at the end of the
Initial Term, and Tenant shall have no further right or option to extend the
Term of this Lease. The Extended Term shall be on all the terms and conditions
of this Lease, except that: (i) Landlord shall have no obligation to pay any
construction or improvements to the Premises, with respect to the Extended Term;
and (ii) the Basic Rent for the Extended Term shall be determined in accordance
with Paragraph 36(b).
(b) The Basic Rent for the Extended Term shall be the greater of (i)
Fair Market Rental Value of the Premises (as hereinafter defined) as of the
commencement of the Extended Term, determined without regard to Tenant's right
to extend, as agreed by the parties or (ii) the Basic Rent for the last year of
the Term, it being understood that during the Extended Term, Additional Rent
shall continue to be calculated in accordance with Paragraph 7.
(c) (i) The term "Fair Market Rental Value" shall mean the annual fixed
rent that a willing tenant would pay and a willing landlord would accept, each
acting in its own best interest and without duress, in an arms-length lease of
the premises in question as of the date (the "Determination Date") on which the
same is to become effective. If Landlord and Tenant shall fail to agree upon the
Fair Market Rental Value within five (5) months before the Determination Date,
then Landlord and Tenant each shall give notice (the "Determination Notice") to
the other setting forth their respective determinations of the Fair Market
Rental Value, and, subject to the provisions of paragraph (ii) below, either
party may apply to the American Arbitration Association or any successor thereto
for the designation of an arbitrator satisfactory to both parties to render a
final determination of the Fair Market Rental Value. The arbitrator shall be a
real estate appraiser or consultant who shall have at lease ten (10) years'
continuous experience
22
as a commercial real estate broker or appraiser, and having significant
experience with property similar to the Building in the greater Boston area. The
arbitrator shall conduct such hearings and investigations as the arbitrator
shall deem appropriate and shall, within thirty (30) days after having been
appointed, choose one of the determinations set forth in either Landlord's or
Tenant's Determination Notice, and that choice by the arbitrator shall be
binding upon Landlord and Tenant. Each party shall pay its own counsel fees and
expenses, if any, in connection with any arbitration under this paragraph (k),
and the parties shall share equally all other expenses and fees of any such
arbitration. The determination rendered in accordance with the provisions of
this paragraph (ii) shall be final and binding in fixing the Fair Market Rental
Value. The arbitrator shall not have the power to add to, modify, or change any
of the provisions of this Lease.
(ii) In the event that the determination of the Fair Market Rental
Value set forth in the Landlord's and Tenant's Determination Notices shall
differ by less than five percent (5%) per square foot of Premises Rentable Area
per annum for each year for which the same is being determined, then the Fair
Market Rental Value shall not be determined by arbitration, but shall instead be
set by taking the average of the determinations wet forth in Landlord's and
Tenant's Determination Notices. Only if the determinations set forth in
Landlord's and Tenant's Determination Notices shall differ by more than 5% per
square foot of Premises Rentable area per annum for any year for which the same
is being determined shall the actual determination of Fair Market Rental Value
be made by an arbitrator as set forth in paragraph (i) above.
(iii) If for any reason the Fair Market Rental Value shall not have
been determined prior to the Determination Date, then, until the Fair Market
Rental Value and, accordingly, the Basic Rent shall have been finally
determined, Tenant shall pay Basic Rent, shall have been finally determined,
Tenant shall pay Basic Rent at the rate quoted by Landlord in Landlord's
Determination Notice, but subject to the limitations of Paragraph 36(b) hereof.
Upon final determination of the Fair Market Rental Value, an appropriate
adjustment to the Basic Rent theretofore paid by Tenant from and after the
Determination Date shall be made reflecting such final determination, and
Landlord or Tenant, as the case may be, shall promptly credit or pay,
respective, to the other any overpayment of deficiency, as the case may be, in
the payment of Basic Rent from the Determination Date to the date of such final
determination.
37. Force Majeure
The time for performance of any act required to be done by either party
shall be extended by a period equal to an delay caused by or resulting form an
act of God, war, civil commotion, fire, casualty, labor difficulties, shortages
of labor or materials or equipment, governmental regulation, act or default of
the other party, or other causes beyond such party's reasonable control (which
shall not, however, the availability of funds).
38. Tenant's Right Of First Offer. If during the term of this Lease Landlord
desires to lease (to someone other than a tenant of the Building having an
option to extend or expand, or a first right to lease all or a portion of such
space) all or a portion of the Building not included in the Premises (the "First
Offer Space"), Landlord shall so notify Tenant setting forth the terms and
conditions on which Landlord is willing to so lease the First Offer Space, and
including a form of
23
the standard lease then in use for the Building. Tenant may, by giving Landlord
notice within fifteen (15) days after receipt of Landlord's notice, elect to
lease the First Offer Space on the terms and conditions set forth in Landlord's
notice. If Tenant shall so elect, Tenant shall within ten (10) days after such
election enter into a lease incorporating the terms and conditions set forth in
Landlord's notice. If Tenant shall fail to make such election within such 15-day
period, or to enter into such lease within such 10-day period, Tenant shall have
no further rights with respect to the First Offer Space, and Landlord shall
thereafter be free to lease any or all of the First Offer Space to such party or
parties, and on such terms and conditions, as Landlord may deem appropriate.
IN WITNESS WHEREOF, the parties hereto have caused this instrument to
be executed in duplicate under seal as of the date first above written.
WAKEFIELD READY MIXED
CONCRETE CO., INC.
By: /s/ Xxxxx Xxxxxxx
Title: President
Hereunto duly authorized
FOCUS ENHANCEMENTS, INC.
By: /s/ X. X. Xxxxxx
Title: President & CEO
Hereunto duly authorized
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EXHIBIT A
[Graphic omitted showing floor plan]
EXHIBIT B
The modifications described in the attached plan shall include without
limitation:
1. install locks on interior doors per Tenant's
specifications;
2. install doorstops on all interior and exterior doors;
3. install an ambient air conditioning system to allow
year-round air conditioner use in the office areas
only;
4. install wall-to-wall carpeting throughout the office
portion of the leased premises of high grade and
quality;
5. install vinyl-composite tile in the warehouse
restrooms;
6. install high-quality ceramic tile in the office
restrooms;
7. install a number of ceiling fans in the warehouse
portion of the leased premises sufficient to cool
such area;
8. install digital thermostats to govern all heating and
cooling requirements;
9. lay a finish coat of pavement in the rear parking lot
area of the building;
10. remove all dirt and debris from the rear parking lot
area of the building;
11. repair concrete around second loading dock; and
12. remove the construction trailer from the main parking
lot.
