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EXHIBIT 10.2
LEASE AGREEMENT
between
FIRST SECURITY BANK, N.A.,
not in its individual capacity except as expressly set forth herein,
but solely as Trustee under the Owner Trust Agreement
dated as of October 21, 1998,
as Lessor
and
GELTEX PHARMACEUTICALS, INC.,
as Lessee
Dated as of October 21, 1998
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TABLE OF CONTENTS
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PAGE
1. Demise; Title; Condition.........................................................................1
2. Term.............................................................................................2
3. Rent.............................................................................................2
4. Use..............................................................................................3
5. Net Lease; Nonterminability......................................................................4
6. Taxes and Other Charges; Legal Requirements and Agreements.......................................5
7. Title; Liens.....................................................................................8
8. Indemnification; Fees and Expenses...............................................................9
9. Environmental Matters...........................................................................10
10. Maintenance and Repair; Additions; Release......................................................15
11. Trade Fixtures; Inspection......................................................................17
12. Condemnation and Casualty.......................................................................17
13. Insurance.......................................................................................23
14. Financial Statements; Other Information.........................................................26
15. Financial Covenants; Mergers; Acquisitions; Asset Sales.........................................27
16. Purchase Procedure..............................................................................31
17. Failure to Complete; Purchase During Term.......................................................32
18. Quiet Enjoyment.................................................................................33
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19. Survival........................................................................................33
20. Subletting; Assignment..........................................................................33
21. Advances by Lessor..............................................................................34
22. Conditional Limitations -- Events of Default and Remedies.......................................35
23. Notices.........................................................................................40
24. Estoppel Certificates...........................................................................40
25. No Merger.......................................................................................40
26. Surrender and Return............................................................................41
27. Separability....................................................................................42
28. Lessee's End of Term Purchase Option............................................................43
29. Signs; Showing..................................................................................44
30. End of Term Adjustment..........................................................................45
31. Certain Definitions.............................................................................46
32. Nature of Lessor's Obligations; Limitations on Liability........................................54
33. Equity Investment Provisions; Additional Costs..................................................55
34. Granting of Easements, Etc......................................................................58
35. Substantial Completion; Completion of "Punchlist" Items.........................................58
36. Recording.......................................................................................59
37. Miscellaneous...................................................................................59
38. Ownership of the Leased Property................................................................59
SCHEDULE A Description of the Demised Premises
SCHEDULE B Basic Rent
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SCHEDULE C Termination Values
SCHEDULE D [Reserved]
SCHEDULE E Environmental Matters
SCHEDULE F Purchase Prices
SCHEDULE G Maximum Lessor and Lessee Risk Amounts
SCHEDULE H Additional Permitted Encumbrances
SCHEDULE I [Reserved]
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THIS LEASE AGREEMENT, dated as of October 21, 1998 (this Lease), between
FIRST SECURITY BANK, N.A., a national banking association, not in its individual
capacity except as set forth herein, but solely as Trustee under the Owner Trust
Agreement dated the date hereof, as lessor (together with its successors and
assigns, Lessor), having an office at 00 Xxxxx Xxxx Xxxxxx, Xxxx Xxxx Xxxx, Xxxx
00000, and GELTEX PHARMACEUTICALS, INC., a Delaware corporation, as lessee
(together with any corporation succeeding thereto by consolidation, merger or
acquisition of its assets substantially as an entirety, Lessee), having an
address at Nine Xxxxxx Xxxxxx, Xxxxxxx, XX 00000.
Capitalized terms are defined in Articles 15, 31 and Schedule B hereof.
Lessor and Lessee hereby agree for good and valuable consideration, the receipt
and sufficiency of which is hereby acknowledged, as follows:
1. DEMISE; TITLE; CONDITION. In consideration of the agreements and
provisions of this Lease, Lessor hereby leases to Lessee, and Lessee hereby
leases from Lessor, subject to the terms and conditions hereinafter set forth,
for the terms described in Article 2 hereof, (i) the parcel of land in Waltham,
Massachusetts, described in Schedule A annexed hereto (the Land Parcel); (ii)
all buildings, structures, improvements, fixtures and other real and personal
property described in or contemplated by the Approved Plans and all other real
and personal property now or hereafter placed on, affixed or appurtenant to, the
Land Parcel by Lessee, as agent for Lessor pursuant to the Agency Agreement,
together with any and all accessions, additions, improvements, substitutions and
replacements thereto or therefor (all of the foregoing described in this clause
(ii), the Improvements); and (iii) all easements, rights and appurtenances
thereto (the Land Parcel, the Improvements and all such easements, rights and
appurtenances with respect thereto called the Leased Property). The Improvements
do not include personal property which constitutes Trade Fixtures which is
placed on the Leased Property by Lessee for Lessee's own account and not as
agent for Lessor under the Agency Agreement.
The Leased Property is demised and let in its present condition without
representation or warranty by Lessor (except as expressly set forth in Article
18), subject in each case to (a) the rights of any parties in possession
thereof, (b) the state of the title thereto existing at the time Lessor acquired
its interest in the Leased Property, (c) any state of facts which an accurate
survey or physical inspection might show, (d) all applicable laws, rules,
regulations, ordinances and restrictions now in effect or hereafter adopted by
any governmental authority having jurisdiction, (e) any environmental conditions
now or hereafter existing at, on or under the Leased Property and (f) any
violations of such laws, rules, regulations, ordinances and restrictions which
may exist at the commencement of the Term of this Lease. Lessee has examined the
Leased Property, and has found the same to be satisfactory for all purposes.
LESSOR HAS NOT MADE AN INSPECTION OF THE LEASED PROPERTY AND MAKES NO
REPRESENTATION OR WARRANTY, EXPRESS OR IMPLIED, WITH RESPECT TO THE LEASED
PROPERTY WHETHER NOW OR HEREAFTER EXISTING
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OR THE LOCATION, USE, DESCRIPTION, DESIGN, MERCHANTABILITY, FITNESS FOR USE FOR
A PARTICULAR PURPOSE, CONDITION OR DURABILITY THEREOF, OR AS TO QUALITY OF THE
MATERIAL OR WORKMANSHIP THEREIN; AND ALL RISKS INCIDENTAL TO THE LEASED PROPERTY
SHALL BE BORNE BY LESSEE. IN THE EVENT OF ANY DEFECT OR DEFICIENCY OF ANY NATURE
IN THE LEASED PROPERTY OR ANY FIXTURE OR OTHER ITEM CONSTITUTING A PORTION
THEREOF, WHETHER PATENT OR LATENT, LESSOR SHALL NOT HAVE ANY RESPONSIBILITY OR
LIABILITY WITH RESPECT THERETO. THE PROVISIONS OF THIS PARAGRAPH HAVE BEEN
NEGOTIATED AND ARE INTENDED TO BE A COMPLETE EXCLUSION AND NEGATION BY LESSOR
OF, AND LESSOR DOES HEREBY DISCLAIM ANY AND ALL WARRANTIES BY LESSOR, EXPRESS OR
IMPLIED, WITH RESPECT TO THE LEASED PROPERTY WHETHER NOW OR HEREAFTER EXISTING
OR ANY FIXTURE OR OTHER ITEM CONSTITUTING A PORTION THEREOF, WHETHER ARISING
PURSUANT TO THE UNIFORM COMMERCIAL CODE OR ANY OTHER LAW NOW OR HEREAFTER IN
EFFECT OR OTHERWISE.
2. TERM.
(a) Subject to the provisions hereof, Lessee shall have and hold the
Leased Property for (i) a construction term which shall begin on October 21,
1998 (the Construction Term Commencement Date), and end at midnight on December
31, 1999 or such earlier date on which the Project is complete (the Construction
Term), and (ii) subject to the provisions of paragraph (b) of this Article 2, a
basic term which shall begin at 12:01 A.M. on the day following the last day of
the Construction Term (the Basic Term Commencement Date) and end at midnight on
October 31, 2005 (the Basic Term), unless sooner terminated as hereinafter
provided.
(b) So long as no Event of Default shall have occurred and be continuing,
on the date of the Termination Notice hereafter defined, Lessee shall deliver to
Lessor not later than a date one year prior to the Term Termination Date a
written notice (the Termination Notice) specifying the exercise by Lessee of its
option either to (i) purchase the Leased Property pursuant to Article 28 or (ii)
to terminate the Lease on the Term Termination Date subject to the terms of
Article 28. Time shall be of the essence in delivering the Termination Notice.
3. RENT.
(a) During the Term, Lessee shall pay the basic rent provided for in
Schedule B annexed hereto (Basic Rent) to Lessor (or to any other party as
Lessor may from time to time specify in writing), by bank wire transfer or
electronic funds transfer (including automated clearinghouse transfers) of
immediately available federal funds initiated by Lessee before 10:30 A.M.,
Eastern Time, at Lessor's address set forth above, or at such other place within
the
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xxxxxxxxxxx Xxxxxx Xxxxxx to which bank wire or electronic funds transfers can
be made, as Lessor may from time to time designate to Lessee in writing. Basic
Rent during the Construction Term shall be accrued in the manner described in
paragraph 1 of Schedule B. Basic Rent during the Basic Term shall be due and
payable by Lessee in quarterly installments in the amounts described in
paragraph 2 of Schedule B on March 31, 2000 and on the last day of each third
month thereafter to and including the last day of the Basic Term (Payment
Dates). Lessor and Lessee agree that Schedule B may be supplemented on the Basic
Term Commencement Date in order to provide for the amounts and timing of Basic
Rent during the Basic Term. If any Payment Date falls on a day that is not a
Business Day, Basic Rent shall be due and payable on the next prior Business
Day.
(b) All amounts that Lessee is required to pay or discharge pursuant to
this Lease in addition to Basic Rent (including, without limitation, amounts
payable as the Purchase Price, Termination Value or other amounts for the Leased
Property pursuant to any provision hereof, any Adjustment Price or Maximum
Lessee Risk Amount payable pursuant to Article 30, any amounts payable pursuant
to Article 21 hereof or as liquidated damages pursuant to paragraph (c) of
Article 22 hereof, any Breakage Costs or other Additional Costs under Article
33, any indemnity payments payable pursuant to Articles 8 and 9 hereof and any
payments required to be paid to any third party or Person), together with every
fine, penalty, overdue interest and cost which may be added for nonpayment or
late payment thereof, shall constitute additional rent hereunder (Additional
Rent). In the event of any failure by Lessee to pay or discharge any Additional
Rent, Lessor, except as may be otherwise provided herein, shall have all rights,
powers and remedies provided for herein or by law or otherwise in the case of
nonpayment of Basic Rent. Lessee may pay Additional Rent directly to the Persons
entitled thereto. Lessee also covenants to pay to Lessor on demand as Additional
Rent, interest at the Overdue Rate, but in no event greater than the maximum
rate permitted by applicable law, on (i) all overdue installments of Basic Rent
from the due date thereof until paid in full, (ii) all overdue amounts of
Additional Rent arising out of obligations which Lessor shall have paid on
behalf of Lessee pursuant to Article 21 hereof or otherwise from the date of
such payment by Lessor until paid in full and (iii) each other sum required to
be paid by Lessee hereunder which is overdue, including without limitation, any
Maximum Lessee Risk Amount or portion thereof, Purchase Price, Termination Value
or other amounts for the Leased Property, any Breakage Costs or other Additional
Costs under Article 33, Adjustment Price, and any amounts payable pursuant to
Article 21 hereof or as liquidated damages pursuant to paragraph (c) of Article
22 hereof, from the date such sum was due until the date received by the Person
entitled thereto.
4. USE. Lessee may use the Leased Property as an office facility and
research and development facilities and for accessory parking and other
ancillary uses. With the prior written consent of Lessor of such other use,
which consent will not be unreasonably withheld, Lessee may use the Leased
Property for any other lawful use which Lessee certifies (i) does not, in
Lessee's good faith determination, adversely affect the fair market value,
utility or useful life of
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the Leased Property and (ii) does not violate any applicable law, rule,
regulation or restriction, including, without limitation, any Legal Requirement.
5. NET LEASE; NONTERMINABILITY
(a) This Lease is a "net lease" and Lessee shall pay all Basic Rent and
Additional Rent without notice, demand, counterclaim, set-off, deduction, or
defense, and without abatement, suspension, deferment, diminution or reduction,
free from any charges, assessments, impositions, expenses or deductions of any
and every kind or nature whatsoever including, without limitation (1) any right
Lessee may have against Lessor, any contractor or any other Person for any
reason (whether in connection with this transaction or any other transaction),
(2) any breach, default or misrepresentation by Lessor or any other Person under
this Lease, the Agency Agreement, or any other Operative Document, or (3) any
invalidity or unenforceability in whole or in part of this Lease, the Agency
Agreement, the Acquisition Agreement, or any other Operative Document, or any
other infirmity herein or therein, or any lack of power or authority of any
party to this Lease, the Agency Agreement, the Acquisition Agreement or any
other Operative Document. All costs, expenses and obligations of every kind and
nature whatsoever relating to the Leased Property and the appurtenances thereto
and the use and occupancy thereof by Lessee or anyone claiming by, through or
under Lessee as Lessee hereunder which may arise or become due during or with
respect to the period constituting the Term hereof shall be paid by Lessee, and
Lessee shall indemnify Lessor against any of the foregoing as provided in
Article 8. Lessee assumes, during the Term, the sole responsibility for the
condition (physical or environmental), use, operation, maintenance, subletting
and management of the Leased Property, and Lessee shall indemnify Lessor with
respect to the foregoing as provided in Article 8, and Lessor shall have no
responsibility in respect thereof and shall have no liability for damage to the
property of Lessee or any sublessee of Lessee on any account or for any reason
whatsoever, except as specifically provided in Article 8. Without limiting the
generality of the foregoing, during the Term, Lessee shall perform all of the
obligations of the sublessor under any subleases affecting all or any part of
the Leased Property which Lessee may hereafter enter into as sublessor to the
extent that Lessee's failure to perform such obligations would result in the
occurrence of a Default or Event of Default under this Lease.
(b) Except as otherwise expressly provided in Article 9, paragraph (c) of
Article 12, paragraphs (a) and (b) of Article 17, clause (ii) of paragraph (b)
of Article 22, and paragraph (h) of Article 22 hereof, this Lease shall not
terminate, nor shall Lessee have any right to terminate this Lease, nor shall
Lessee be entitled to any abatement or reduction of rent hereunder, nor shall
Lessee have the right to be released or discharged from any obligations or
liabilities hereunder for any reason, including without limitation, any damage
to or destruction of all or part of the Leased Property; any restriction,
deprivation (including eviction) or prevention of, or any interference with, any
use or the occupancy of the Leased Property (whether due to any defect in or
failure of Lessor's title to the Leased Property, any Lessor Lien or otherwise);
any
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condemnation, requisition or other taking or sale of the use, occupancy or title
to the Leased Property; any action, omission or breach on the part of Lessor
under this Lease or under any other agreement between Lessor and Lessee; the
inadequacy or failure of the description of the Leased Property to demise and
let to Lessee the property intended to be leased hereby; any sale or other
disposition of the Leased Property; the impossibility or illegality of
performance by Lessor or Lessee or both; the failure of Lessor to deliver
possession of the Leased Property; any action of any court, administrative
agency or other governmental authority; any environmental condition affecting
the Leased Property; or any other cause, whether similar or dissimilar to the
foregoing, any present or future law notwithstanding.
(c) Lessee will remain obligated under this Lease in accordance with its
terms, and will not take any action to terminate, rescind or avoid this Lease
for any reason, notwithstanding any bankruptcy, insolvency, reorganization,
liquidation, dissolution or other proceeding affecting Lessor, or any assignee
of Lessor, or any action with respect to this Lease which may be taken by any
receiver, trustee or liquidator, or any assignee of Lessor or by any court in
any such proceeding. Lessee waives all rights at any time conferred by statute
or otherwise to quit, terminate or surrender this Lease or the Leased Property
(except as otherwise expressly provided with respect to condemnation in
paragraph (c) of Article 12, paragraphs (a) and (b) of Article 17 hereof and
paragraph (h) of Article 22 hereof), or to any abatement or deferment of any
Basic Rent, Additional Rent or other sum payable by Lessee hereunder, or for
damage, loss or expense suffered by Lessee on account of any cause referred to
in this Article 5 or otherwise.
6. TAXES AND OTHER CHARGES; LEGAL REQUIREMENTS AND AGREEMENTS.
(a) Lessee shall pay and discharge, on or before the last day upon which
the same may be paid without interest or penalty, and shall indemnify each
Indemnified Party on an after tax basis, from and against, all taxes, including
any tax based upon or measured by gross rentals or receipts from the Leased
Property, assessments, levies, fees, water and sewer rents and other
governmental and similar charges, general and special, ordinary or
extraordinary, and whether or not the same shall have been within the express
contemplation of the parties hereto, and any interest and penalties thereon,
which are levied, assessed or due against (i) such Indemnified Party and which
relate to such Indemnified Party's interest in the Leased Property, the use,
occupancy, operation or possession of the Leased Property or any part thereof or
the transactions contemplated by the Operative Documents, (ii) the Leased
Property or the interest of Lessee or Lessor therein, (iii) Basic Rent or
Additional Rent or other sums payable by Lessee hereunder, (iv) this Lease or
the interest of Lessee or the Indemnified Parties hereunder, (v) the use,
occupancy, construction, repair or rebuilding of the Leased Property or any
portion thereof or (vi) gross receipts from the Leased Property (collectively
termed Taxes). If any tax or assessment levied or assessed against the Leased
Property may legally be paid in installments, Lessee shall have the option to
pay such tax or assessment in installments; provided, however, that upon the
termination or expiration of the Term, Lessee shall pay any such tax or
assessment
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which it has been paying in installments in full, on or prior to such
termination or expiration date. Nothing in this Lease shall require payment by
Lessee of any franchise, estate, inheritance, succession, transfer, net income
or profits taxes of Lessor or Beneficiary (the foregoing, collectively, Excluded
Taxes), except for transfer taxes, recording fees, or similar charges payable in
connection with a conveyance hereunder to Lessee or in connection with Lessor's
exercise of remedies after an Event of Default hereunder and any gross receipts
or similar taxes imposed or levied upon, assessed against or measured by the
Basic Rent, Additional Rent or any other sums payable by Lessee hereunder or
levied upon or assessed against the Leased Property. Lessee shall prepare and
file or cause to be filed on a timely basis all returns and other materials
required in connection with any taxes, assessments or other charges that Lessee
is required to pay pursuant to this Article 6; provided, however, where legally
required, Lessor will sign such return or related power of attorney. Lessee
shall furnish to Lessor promptly, and in any event within 30 days after the
later of the date the same becomes due and payable and the date of written
demand by Lessor, as the case may be, proof of the payment of any such tax,
assessment, fee, rent or charge which is payable by Lessee and, upon written
demand of Lessor, proof of the filing of all returns and other materials
required in connection therewith.
(b) Lessee shall pay all charges for utility, communication and other
services to the extent rendered or used during the Term on or about the Leased
Property, whether or not payment therefor shall become due after the Term.
(c) Lessee shall at all times during the Term, at Lessee's own cost and
expense, perform and comply with all laws, rules, orders, ordinances,
regulations and requirements now existing or hereafter enacted or promulgated,
of every government and municipality having jurisdiction over the Leased
Property and of any agency thereof, relating to the Leased Property or the
facilities or equipment thereon or therein, or the franchises and privileges
connected therewith, or, to the extent that Lessor or Lessee has any obligation
or responsibility therefor, the streets, sidewalks, vaults, vault spaces, curbs
and gutters adjoining the Leased Property (collectively, Legal Requirements),
whether or not such Legal Requirements so involved shall necessitate structural
changes, improvements, interference with use and enjoyment of the Leased
Property, replacements or repairs, extraordinary as well as ordinary, and Lessee
shall so perform and comply, whether or not such Legal Requirements shall now
exist or shall hereafter be enacted or promulgated, and whether or not such
Legal Requirements can be said to be within the present contemplation of the
parties hereto. Lessee shall at all times during the Term, at Lessee's own cost
and expense, perform and comply with the terms of all Permitted Encumbrances and
any easement granted or released pursuant to Article 34 hereof and shall perform
all of the obligations of Lessor under such Permitted Encumbrances and of the
grantor or releasor under the related instrument of grant or release. Lessee
shall, at its expense, comply with all provisions of insurance policies required
pursuant to Article 13 hereof, and with the provisions of all contracts,
agreements, instruments and restrictions existing at the
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commencement of this Lease or thereafter suffered or permitted by Lessee,
affecting the Leased Property or any part thereof or the ownership, occupancy,
use, operation or possession thereof.
(d) Notwithstanding the provisions of paragraphs (a) through (c) of this
Article 6 and those of Article 7, Lessee shall have the right to contest, by
appropriate legal proceedings, any tax, charge, levy, assessment, lien or other
encumbrance, and/or any Legal Requirement affecting the Leased Property, and to
postpone payment of or compliance with the same during the pendency of such
contest, provided that (i) the commencement and continuation of such proceedings
shall suspend the collection thereof from, and suspend the enforcement thereof
against, Lessor and the Leased Property, (ii) no part of the Leased Property nor
any Basic Rent or Additional Rent or other sums payable by Lessee hereunder
shall be in imminent danger of being sold, forfeited, attached or lost, (iii)
there shall not exist (x) any interference with the use and occupancy of the
Leased Property or any part thereof that has or would have a material adverse
effect on the fair market value, utility or useful life of the Leased Property,
or (y) any interference with the payment of Basic Rent or any Additional Rent
(other than the portion subject to the contest), (iv) Lessee shall promptly
prosecute such contest to a final settlement or conclusion, or if Lessee deems
it advisable to abandon such contest, Lessee shall promptly pay or perform the
obligation which was the subject of such contest and (v) at no time during the
permitted contest shall there be a risk of the imposition of criminal liability
on Lessor arising from non-payment of the contested item or non-compliance with
the contested Legal Requirement. If any Default or Event of Default hereunder
shall have occurred and be continuing, or any such contest or contests,
individually or in the aggregate, at any one time pending with respect to the
Leased Property shall involve an amount of money or potential loss (including
fines and similar charges) in excess of $1,000,000, plus any security
theretofore provided pursuant to this provision, then Lessee shall either (i)
deposit with the Depositary (as defined in subparagraph (i) of paragraph (b) of
Article 12 of this Lease) an amount equal to 100% of the tax, charge, levy,
assessment, lien or other encumbrance affecting the Leased Property, which
amount may be invested in accordance with the terms and provisions set forth in
subparagraph (iv) of paragraph (b) of Article 12 of this Lease or (ii) post an
equivalent bond, or letter of credit from an institution (other than Lessee or
its Affiliates) meeting the requirements to be a Depositary under this Lease,
for security. Lessee shall not postpone the payment of any such tax, charge,
levy, assessment, lien or other encumbrance for such length of time as shall
permit the Leased Property, or any lien thereon created by such item being
contested, to be sold by federal, state, county or municipal authority for the
non-payment thereof; Lessee shall not postpone compliance with any such law,
rule, order, ordinance, regulation or other governmental requirement if Lessor
will thereby be subject to criminal prosecution, or if any municipal or other
governmental authority shall be in a position according to applicable law to
commence and carry out any work to comply with the same or to foreclose or sell
any lien affecting all or part of the Leased Property which shall have arisen by
reason of such postponement or failure of compliance.
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(e) Without limiting the generality of any of the other provisions of this
Article 6, Lessee shall at all times during the Term of this Lease promptly
comply with the terms of, and fully and faithfully pay and perform its
obligations as agent incurred under, the Agency Agreement. In the event of the
termination of this Lease as herein provided or Lessee's abandonment of the
Leased Property, the obligations and liabilities of Lessee (relating to the
period included within the Term of this Lease) with respect to each Indemnified
Party, actual or contingent, under this Article 6 shall survive such termination
or abandonment.
7. TITLE; LIENS. Lessee represents and warrants to, and covenants with,
Lessor that Lessor has and shall have good fee simple title to the Leased
Property, subject only to Permitted Encumbrances, and that Lessee shall warrant
and defend the same to Lessor against the lawful claims and demands of all
persons other than Lessor Liens. Subject to the provisions of paragraph (d) of
Article 6, Lessee will promptly, but in any event no later than the earlier of
30 days after its Actual Knowledge of the filing thereof or the enforcement of
the same, at its own expense, remove, satisfy or discharge of record, by bond or
otherwise, any charge, lien, security interest or encumbrance upon the Leased
Property, upon any Basic Rent, or upon any Additional Rent or other sums payable
by Lessee under this Lease which arises for any reason (except for Lessor Liens
and any other acts or omissions of Lessor or anyone claiming by, through or
under Lessor, without the consent of Lessee), including all liens which arise
out of Lessee's possession, use, operation and occupancy of the Leased Property,
but not including any Permitted Encumbrances. Nothing contained in this Lease
shall be construed as constituting the consent or request of Lessor, express or
implied, to or for the performance by any contractor, laborer, materialman, or
vendor of any labor or services or for the furnishing of any materials for any
construction, alteration, addition, repair or demolition of or to the Leased
Property or any part thereof. Notice is hereby given that Lessor will not be
liable for any labor, services or materials furnished or to be furnished to
Lessee, or to anyone holding an interest in the Leased Property or any part
thereof through or under Lessee, and that no mechanic's or other liens for any
such labor, services or materials shall attach to or affect the interest of
Lessor in and to the Leased Property. In the event of the failure of Lessee to
discharge any charge, lien, security interest or encumbrance within the time
period set forth above and otherwise as aforesaid, except during the pendency of
any contest permitted and conducted pursuant to paragraph (d) of Article 6,
after 10 days prior notice to Lessee (or after shorter notice or without notice
if prudent under the circumstances to prevent enforcement or other action
against Lessor or the Leased Property), Lessor may discharge such items by
payment or bond or both, and Lessee will repay to Lessor, upon demand, any and
all amounts paid therefor, or by reason of any liability on such bond, and also
any and all reasonable incidental expenses, including reasonable attorneys'
fees, incurred by Lessor in connection therewith.
8. INDEMNIFICATION; FEES AND EXPENSES. Lessee shall pay, and shall
protect, defend and indemnify Lessor, Bank, Beneficiary, Fleet and their
successors in interest, and each and all of such parties' shareholders,
officers, directors, employees, attorneys and agents and any holder
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of any beneficial interest in any of them but only in their capacity as such
(each, an Indemnified Party and collectively, the Indemnified Parties) against
and hold each Indemnified Party harmless from all liabilities, losses, damages,
costs, expenses (including reasonable attorneys' fees and expenses), claims,
demands or judgments of any nature actually imposed upon or incurred by such
Indemnified Party to the extent (a) arising or alleged to arise from or in
connection with or relating to the condition, use, operation, maintenance,
subletting and management of the Leased Property during the Indemnification
Period, (b) arising from or in connection with or relating to the use and
occupancy of the Leased Property by Lessee during the Indemnification Period or
anyone claiming by, through or under Lessee as Lessee hereunder or (c) arising
from or in connection with any of the following: (i) any injury to, or the death
of, any person or any damage to or loss of property on or adjacent to the Leased
Property or growing out of or connected with, the ownership, use, nonuse,
occupancy, operation, possession, condition, construction, repair or rebuilding
of the Leased Property or adjoining property (to the extent arising from or
related to the Leased Property or the transactions contemplated by this Lease),
or adjoining sidewalks, streets or ways (to the extent arising from or related
to the Leased Property or the transactions contemplated by this Lease) or
resulting from the condition of any thereof, (ii) any liability actually
incurred by the Indemnified Party seeking indemnification hereunder arising from
claims by third parties resulting from any violation by Lessee of (A) any
provision of this Lease, or (B) any Legal Requirement affecting the Leased
Property, or (C) any provision of any lease (other than this Lease) or other
agreement relating to the Leased Property as of the date hereof or hereafter in
effect to which Lessee is a party or by which Lessee is bound, or (D) any
contract or agreement to which Lessee is a party, or any restriction affecting
the Leased Property or the ownership, use, nonuse, occupancy, condition,
operation, possession, construction, repair or rebuilding thereof or of
adjoining property, sidewalks, streets or ways (to the extent arising from or
related to the Leased Property or the transactions contemplated by this Lease);
(iii) any contest permitted by paragraph (d) of Article 6; and (iv) any
violation or alleged violation by Lessee of any of the terms and provisions
hereof; PROVIDED, HOWEVER, that any such indemnity provided for in this Article
8 shall not, as to any Indemnified Party, be available to the extent but only to
the extent that any such losses, claims, damages, liabilities, costs, demands or
judgments or related expenses resulted from the gross negligence or willful
misconduct of such Indemnified Party. The foregoing shall not give rise to any
third party beneficiary rights with respect to any Person who is not an
Indemnified Party.
If any Indemnified Party shall be made a party to any such litigation
commenced against Lessee, and if Lessee, at its expense, shall fail to provide
such Indemnified Party with counsel approved by such Indemnified Party, which
approval shall not be unreasonably withheld, Lessee shall pay all costs and
reasonable attorney's fees and expenses incurred or paid by such Indemnified
Party or its agent in connection with such litigation. Nothing in this Article 8
is meant to limit or otherwise impair the indemnification set forth in Article
9. To the extent legally permissible, such Indemnified Party consents to being
represented by the same counsel as Lessee in such action; provided, however,
that such Indemnified Party may be represented by
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separate counsel selected by Lessor and reasonably acceptable to Lessee, at
Lessee's expense if, in such Indemnified Party's reasonable judgment, separate
counsel is necessary to protect such Indemnified Party's interest because of
differing interests of such Indemnified Party and Lessee. Notwithstanding
anything to the contrary contained in this Article 8, no Indemnified Party shall
enter into any settlement or other compromise with respect to any Claim subject
to indemnification under this Article 8 (other than a Claim involving any risk
of the imposition of criminal liability on such Indemnified Party) without the
prior written consent of Lessee, which consent shall not be unreasonably
withheld or delayed; PROVIDED, HOWEVER, Lessee may not withhold its consent (and
otherwise shall be deemed to consent) to such settlement or other compromise
unless (i) Lessee shall have first acknowledged in writing its obligation to
fully indemnify such Indemnified Party in respect of such Claim and (ii) if, in
the reasonable opinion of such Indemnified Party, such Claim involves any risk
of significant civil liability on such Indemnified Party or will involve a
material risk of the sale, forfeiture or loss of, or the creation of any lien
(other than a Permitted Encumbrance) on the Leased Property or any part thereof,
Lessee shall have posted a bond or other security satisfactory to the relevant
Indemnified Party in respect to such risk.
In the event of the termination of this Lease as herein provided or
Lessee's abandonment of the Leased Property, subject to Section 13 (g) hereof,
the obligations and liabilities of Lessee with respect to each Indemnified
Party, actual or contingent, under this Article 8 and to the extent attributable
to the Indemnification Period, shall survive such termination or abandonment.
9. ENVIRONMENTAL MATTERS. Lessee represents and warrants (with respect to
statements made as of a particular date) and covenants (with respect to future
or ongoing obligations) to the Indemnified Parties that:
(i) at all times during the Term of this Lease, the Leased Property,
Lessee, all sublessees and any assignee of Lessee shall comply in all
material respects with all applicable Environmental Laws, including
the effecting of cures in compliance with Environmental Laws, if
applicable; Lessee has, or will have when required, and has ensured
that all sublessees of the Leased Property have, obtained all permits,
licenses, and any other authorizations to conduct operations at the
Leased Property that are required under applicable Environmental Laws
(collectively, Environmental Permits) as of the Construction Term
Commencement Date and shall obtain and shall ensure that all
sublessees of the Leased Property shall obtain and maintain in full
force and effect, at all times during the Term of this Lease, all
Environmental Permits that are now or hereafter required; Lessee is,
and has ensured that all sublessees of the Leased Property are in
compliance in all material respects with all terms and conditions of
all Environmental Permits required to be in effect as of the
Construction Term Commencement Date, and Lessee shall, and shall
ensure that all sublessees of the Leased Property shall,
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comply in all material respects with all terms and conditions of all
Environmental Permits now or hereafter required; Lessee shall cause
any alterations of, or construction on, the Leased Property to be done
in compliance in all material respects with applicable Environmental
Laws, and in connection with any such alterations or construction,
shall remove and dispose of, in compliance with applicable
Environmental Laws, any Hazardous Substances present upon the Leased
Property to the extent required or authorized (as to such disposal) by
applicable Environmental Laws;
(ii) as of the Construction Term Commencement Date, (a) no notices,
complaints or orders of violation or non-compliance regarding alleged
violations of, or strict liability under, Environmental Laws have been
received by Lessee or, to the best of its knowledge, by any Person
regarding the Leased Property; (b) no federal, state or local
governmental environmental investigation or legal action by a private
party is pending or, to the best of Lessee's knowledge, overtly
threatened, arising under or pursuant to Environmental Laws with
regard to the Leased Property; and (c) no liens have been placed upon
the Leased Property in connection with any actual or alleged liability
under any Environmental Laws;
(iii) the Leased Property (a) as of the Construction Term Commencement Date
has not been used by Lessee or, to the best of Lessee's knowledge, by
any other Person to generate, manufacture, refine, produce or process
any Hazardous Substance or to store, handle, treat, dispose, transfer
or transport any Hazardous Substance other than as set forth in
Schedule E, and (b) will not be used by Lessee or any sublessee or
assignee of Lessee at any time during the Term of this Lease to
generate, manufacture, refine, produce or process any Hazardous
Substance or to store, handle, treat, dispose, transfer or transport
any Hazardous Substance, other than normal and lawful uses of such
Hazardous Substances in lawful quantities and in compliance with
Environmental Laws in connection with Lessee's intended use of the
Leased Property in accordance with the provisions of Article 4, where
such uses will have no material adverse effect upon the Leased
Property;
(iv) as of the Construction Term Commencement Date, except for a retention
pond for receiving surface runoff, if any, no surface impoundments are
(and during the Term of this Lease, none will be) constructed,
operated or maintained in or on the Leased Property and no above
ground tanks or other containment structures will be constructed,
operated or maintained on the Leased Property in violation of
applicable Environmental Laws and no underground storage tanks are
(and during the Term of this Lease, none will be) constructed,
operated or maintained in or on the Leased Property; as of the
Construction Term Commencement Date, there is no asbestos nor
asbestos-containing material (except commercially produced
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product which is being removed in compliance with all Environmental
Laws as a part of the Project or the Sodexho P&S as defined in the
Agency Agreement) located in, on, at or under the Leased Property nor
is there any PCB- containing equipment, including PCB-containing
transformers located in, on, at or under the Leased Property nor will
any of the foregoing be located in, on, at or under the Leased
Property at any time during the Term of this Lease;
(v) as of the Construction Term Commencement Date, other than as set forth
in Schedule E, the Leased Property is free of Hazardous Substances at,
in, on or under the Leased Property, regardless of the source of any
such Hazardous Substances, except in concentrations that do not exceed
those not prohibited under or pursuant to applicable Environmental
Laws in connection with Lessee's development and intended use of the
Leased Property in accordance with the provisions of Article 4 and
none of which will have a material adverse effect upon the Leased
Property; and
(vi) at all time during the Term, other than normal and lawful uses of such
Hazardous Substances in lawful quantities and in compliance with
Environmental Laws in connection with Lessee's intended use of the
Leased Property in accordance with the provisions of Article 4, where
such uses will have no material adverse effect upon the Leased
Property, neither Lessee nor any sublessee or assignee of Lessee
shall, directly or indirectly, place Hazardous Substances at, in, on,
over or under the Leased Property.
Promptly upon obtaining Actual Knowledge thereof, Lessee shall give to
Lessor notice of the occurrence of any of the following events: (i) the failure
of the Leased Property, Lessee, any sublessee or assignee of Lessee to comply,
in all material respects, with any Environmental Law; (ii) the issuance to
Lessee, or any sublessee of space in the Leased Property or any assignee of
Lessee, of any written notice, complaint or order of violation or non-compliance
in any material respect with regard to the Leased Property or the use thereof
with respect to Environmental Laws; (iii) any written notice of a pending or
threatened investigation by any governmental agency to determine whether
Lessee's (or any sublessee's or assignee's) operations on the Leased Property
are in violation, in any material respect, of any Environmental Law; (iv) any
written notice from any governmental agency requiring any corrective action with
respect to the Leased Property or any portion thereof under any Environmental
Law; (v) any written notice or other written communication with respect to a
pending or threatened private party judicial or administrative action relating
to violation, of any Environmental Law in connection with the use, occupancy or
operation of the Leased Property; (vi) the existence or threat of a release of a
Hazardous Substance at or to or under the Leased Property or any condition
regulated by any Environmental Law in each case which is or must be reported to
a governmental agency or that could have a material adverse effect upon the
Leased Property; or (vii) any other occurrence or
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discovery of any condition at, adjacent to or under the Leased Property related
to Environmental Laws and which would cause or have a material adverse effect on
the Leased Property.
At any time if Lessor receives notice that an adverse change in the
environmental condition of the Leased Property has occurred or that an adverse
environmental condition with respect to the Leased Property has been discovered,
Lessor shall give notice thereof to Lessee, and Lessee shall (i) diligently
commence (or cause another Person to commence) to cure such condition, to the
extent required by applicable Environmental Laws (including any evaluations or
assessment of such conditions) and to develop an appropriate plan with respect
thereto (or cause another Person to do so) within 30 days after receipt of such
notice (or such shorter period as may be required by law or in the event of an
emergency) and (ii) thereafter diligently prosecute (or cause another Person to
diligently prosecute) to completion such cure. If Lessee (or such other Person)
fails to cure such condition, then Lessor may, after reasonable prior notice to
Lessee, take such actions as it may deem necessary to cure such condition.
Notwithstanding the foregoing, Lessor shall not be obligated to take any actions
in response to any such condition. All costs and expenses reasonably incurred by
Lessor in connection with curing any such condition which Lessor is permitted to
cure hereunder shall be paid by Lessee upon demand. Notwithstanding anything to
the contrary contained in this paragraph, if , in the reasonable professional
opinion of Lessor's environmental engineer, the costs to Lessor to cure as
permitted hereunder would be in excess of $1,000,000, Lessor, at its option, may
require that Lessee purchase the Leased Property. The purchase price for the
Leased Property, shall be equal to (i) the Termination Value payable as of the
date of purchase, plus (ii) an amount equal to the costs and expenses described
in paragraph b(iii) of Article 16. The sale of the Leased Property shall be in
accordance with the terms of Article 16 hereof. Lessee agrees to indemnify,
defend and hold harmless each Indemnified Party from and against any and all
losses, liabilities (including third party liabilities), injuries, damages,
judgments, decrees, orders, penalties, claims, charges, costs and expenses
(including, without limitation, reasonable fees and disbursements of counsel,
consultants and expert witnesses for such Indemnified Party), and including,
without limitation, any diminution in the fair market value of the Leased
Property, which may be suffered or incurred by, or asserted against such
Indemnified Party to the extent arising directly or indirectly out of any breach
or violation of this Article 9 or out of the presence, use, storage,
transportation, disposal, treatment, release, threatened release, discharge,
emission, generation or presence of any Hazardous Substances at, from, on, under
or in the Leased Property, regardless of whether occurring before, during or,
except as otherwise provided herein, after the Term and regardless of the source
of any such Hazardous Substances. Notwithstanding the foregoing or anything to
the contrary set forth herein or in any of the other Operative Documents, Lessee
shall not be liable for the payment of any indemnification pursuant to this
Lease (including, without limitation, to Lessor) to any particular Indemnified
Party, for violations of Environmental Laws or environmental contamination to
the extent and only to the extent resulting from the actual gross negligence or
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willful misconduct of such Indemnified Party, its employees, agents or assigns
except to the extent resulting from or at the direction of Lessee or resulting
from Lessee's failure to comply with this Article 9. Any indemnity payments owed
to any Indemnified Party hereunder with respect to any diminution in the fair
market value of the Leased Property (Diminution Payments), shall be paid and
shall be held by Lessor. So long as no Default or Event of Default has occurred
and is continuing and provided that Beneficiary has been paid its Equity
Investment in full and has been paid in full all amounts owing to it, then the
remaining amount of any such Diminution Payments then held by Lessor shall be
paid over to Lessee at the earlier to occur of the end of the Term or the
Termination Date.
The warranties and obligations of Lessee, and the rights and remedies of
each Indemnified Party under this Article 9 are in addition to and not in
limitation of any other warranties, obligations, rights and remedies provided in
this Lease or otherwise at law or in equity.
In the event of the termination of this Lease as herein provided or
Lessee's abandonment of the Leased Property, subject to Section 13 (g) hereof,
the obligations and liabilities of Lessee with respect to each Indemnified
Party, actual or contingent, under this Article 9 and relating to the period
through the end of the Term, whether arising before or after the end of the
Term, shall survive such termination or abandonment.
10. MAINTENANCE AND REPAIR; ADDITIONS; RELEASE.
(a) Lessee acknowledges that it has received the Leased Property in good
condition, repair and appearance on and as of the Construction Term Commencement
Date (or with respect to the Improvements acquired or constructed subsequent
thereto, on and as of the date that the Improvements are Substantially Complete,
subject only to the "punchlist items", a copy of which will be provided to
Lessor). Lessee will, at its cost and expense, keep and maintain the Leased
Property, including any altered, rebuilt, additional or substituted buildings,
structures and other improvements thereto, in good condition and repair,
ordinary wear and tear (including, without limitation, from the elements)
excepted, and (except as otherwise provided in paragraph (c) of Article 12) will
make all structural and non-structural, and ordinary and extraordinary changes,
repairs and replacements, foreseen or unforeseen, which may be required, whether
or not caused by its act or omission, to be made upon or in connection with the
improvements to the Leased Property in order to keep the same in such condition,
ordinary wear and tear (including, without limitation, from the elements) and
the circumstances described in paragraph (c) of Article 12 excepted, including
taking, or causing to be taken, action necessary to maintain the Leased Property
in compliance in all material respects with any applicable Legal Requirements,
19
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including all applicable Environmental Laws. Lessee covenants to perform or
observe all terms, covenants or conditions of any reciprocal easement or
maintenance agreement to which it may at any time be a party or to which the
Leased Property is subject. Lessee shall, at its expense, use its reasonable
efforts to enforce compliance in all material respects with any reciprocal
easement, maintenance or other agreement benefitting the Leased Property by any
other Person subject to such agreement. Lessor shall not be required to
maintain, alter, repair, rebuild or replace any improvements on the Leased
Property or to maintain the Leased Property, and Lessee expressly waives the
right to make repairs at the expense of Lessor pursuant to any law at any time
in effect. If Lessee shall abandon the Leased Property, it shall give Lessor
prompt notice thereof.
(b) If Lessor or any governmental authority determines that any
Improvements situated on the Leased Property at any time during the term of this
Lease shall encroach upon any property, street or right-of-way adjoining or
adjacent to the Leased Property, or shall violate the agreements or conditions
contained in any restrictive covenant affecting the Leased Property or any part
thereof, or shall impair the rights of others under or obstruct any easement or
right-of-way to which the Leased Property is subject, then, promptly after the
written request of Lessor, Lessee shall, at its expense, either (i) obtain
effective waivers or settlements of all claims, liabilities and damages
resulting from each such encroachment, violation, impairment or obstruction
whether the same shall affect Lessor, Lessee or both, or (ii) make such changes
in the Improvements on the Leased Property and take such other action as shall
be necessary to remove such encroachments or obstructions and to end such
violations or impairments, including, if necessary, the alteration or removal of
any Improvement on the Leased Property. Any such alteration or removal shall be
made in conformity with the following requirements of this Article 10 to the
same extent as if such alteration or removal were an alteration under the
provisions of paragraph (c) of this Article 10 and there shall be no abatement
of rent by reason of such alteration or removal.
(c) Lessee shall undertake and complete the Work as agent for Lessor in
accordance with the terms and conditions of the Agency Agreement. In addition to
the Work, during the Term of this Lease, so long as no Default or Event of
Default hereunder has occurred and is continuing, after notice to Lessor, Lessee
may make any alterations, additions, modifications or improvements to the Leased
Property whether or not structurally integrated with the existing Improvements
on the Leased Property (each an Addition), provided that, (A) no such Addition
(i) reduces the fair market value of the Leased Property, taking into account
any increase in the fair market value of the Leased Property caused by prior
improvements to the Leased Property made by Lessee as permitted by this Lease at
any time during the Term, adversely affects the structural integrity of such
Improvements, or impairs the utility or operation of the Leased Property (in
each case other than during the construction period with respect to such
Addition), (ii) reduces the remaining useful life of such Improvements, or (iii)
violates any agreement or restriction (x) to which the Leased Property is
subject or (y) which benefits such Leased Property, and (B) Lessee shall finance
construction of any Addition (i) using its own funds, or
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(ii) through a borrowing unsecured by any interest in the Leased Property. Any
Addition which exceeds 20% of the Cost of the Project shall be consented to by
Lessor in writing prior to commencement thereof. Any such Addition shall be made
in a good and workmanlike manner using a quality of material and workmanship at
least as good as the original work or installation of such Improvements and
otherwise in conformance with the character and quality of such existing
Improvements and in compliance with all applicable Legal Requirements. Prior to
undertaking any Addition, Lessee shall deliver to Lessor an Officer's
Certificate with respect to satisfaction of the conditions set forth in the
foregoing clauses (A)(i), (A)(ii) and (A)(iii), and, upon the reasonable request
by Lessor, the fair market value and the remaining useful life of such
Improvements shall be determined by an Appraisal of the Leased Property,
performed at Lessee's sole cost and expense. Any Addition shall be made at the
sole cost and expense of Lessee, may not be encumbered and shall become the
property of Lessor and subject to this Lease. At Lessor's request, Lessee shall
within 10 Business Days thereafter execute and deliver to Lessor a lease
supplement with respect to any such Additions. Lessee's execution of a lease
supplement for any such Addition shall constitute (i) Lessee's acknowledgment
and certification that any work associated therewith complies with the
requirements of this Article 10 and (ii) as between Lessor and Lessee and for
purposes of the Operative Documents but for no other purpose, Lessee's
unconditional and irrevocable acceptance of such Addition for lease hereunder,
which acceptance shall not constitute a waiver of any rights against third
parties.
(d) All work done in accordance with this Article 10 shall comply with the
requirements of all insurance policies required to be maintained by Lessee under
Article 13 hereof. Lessee shall promptly pay all costs and expenses of each such
Addition, discharge all liens arising therefrom and procure and pay for all
permits and licenses required in connection therewith.
11. TRADE FIXTURES; INSPECTION.
(a) Lessor acknowledges and agrees that the items of trade fixtures,
cabling and networks running from the utility closets to work stations,
machinery and equipment for the Leased Property (but specifically excluding
Improvements) that are not financed by Lessor Advances under and as defined in
the Agency Agreement as part of the Cost of the Project as defined by the Agency
Agreement are and shall remain the property of Lessee (Trade Fixtures) and be
treated as "trade fixtures" for the purposes of this Lease and Lessee may remove
the same from any Leased Property at any time prior to the termination of this
Lease, provided that such removal does not impair the fair market value, utility
or useful life of the Leased Property and that Lessee shall repair any damage to
such Leased Property resulting from such removal. Lessee may, at its own cost
and expense, install or place or reinstall or replace upon or remove from the
Leased Property any such Trade Fixtures. Any such Trade Fixtures shall not
become the property of Lessor (other than replacements of fixtures, machinery
and equipment which are the property of Lessor, which replacement shall also be
the property of Lessor). Replacements of
21
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fixtures, machinery and equipment which are property of the Lessor shall be of
at least equal quality to the replaced fixtures, machinery and equipment when
the replaced items were operational. Lessee will be responsible for the repair
and maintenance of Trade Fixtures. Lessor, at Lessee's request and expense, will
waive or subordinate its lien on Lessee's personal property and Trade Fixtures
for the benefit of any equipment lessor or other person providing financing.
(b) Upon the request of Lessor, Lessee shall make Lessee's records
pertaining to the maintenance of the Leased Property available to Lessor for
inspection. Lessee shall permit Lessor, Beneficiary, and their agents, at any
such party's risk and expense and after reasonable notice to visit and inspect
(in the company of a representative of Lessee) the Leased Property, in a manner
that does not unreasonably interfere with Lessee's use and operation of the
Leased Property at such reasonable times during normal business hours and as
often as may be reasonably requested, including, without limitation, to make
such inspections as any such party deems necessary or desirable to insure
compliance with the provisions of Article 9, Article 10, this Article 11 and
Article 26.
12. CONDEMNATION AND CASUALTY.
(a) Lessee hereby assigns to Lessor any award, compensation, insurance
proceeds or other payment to which Lessee may become entitled by reason of its
interest in the Leased Property (i) if the Leased Property, or any portion
thereof, is damaged or destroyed by fire or other casualty or cause, or (ii) by
reason of any condemnation, requisition or other taking or sale of the use,
occupancy or title to the Leased Property or any portion thereof in, by or on
account of any actual or threatened eminent domain proceeding or other action by
any governmental authority, civil or military, or other Person having the power
of eminent domain. So long as there is no Event of Default continuing hereunder,
Lessee is hereby authorized and empowered to, at its cost and expense, in the
name and behalf of Lessor, Lessee, or otherwise, to appear in any such
proceeding or other action, to negotiate, accept and prosecute any claim for any
award, compensation, insurance proceeds or other payment on account of any such
loss, damage or destruction, condemnation, requisition or other taking or sale
and to cause any such award, compensation, insurance proceeds or other payment
to be paid to Lessor. Furthermore, Lessee shall use reasonable efforts to
achieve the maximum award obtainable under the circumstances. Lessor and
Beneficiary may, at their respective cost and expense (unless an Event of
Default shall have occurred and be continuing in which event such appearance
shall be at Lessee's sole cost and expense), appear in any such proceeding or
other action, in a manner consistent with the foregoing. To the extent that
Lessor or Beneficiary do not appear and act at such proceeding, Lessee shall
take all reasonable appropriate action in connection with each such claim,
proceeding or other action, and shall pay its costs and expenses in connection
therewith. In addition, so long as there is no Default or Event of Default
existing and continuing hereunder, Lessee, at its sole cost and expense, shall
be entitled to submit, negotiate, accept and prosecute a
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claim for any award, compensation or insurance proceeds or other payment payable
to Lessee to the extent payable for interruption of business, moving expenses or
any property owned by Lessee that is not part of the Leased Property (any such
insurance proceeds or other payment payable to Lessee to the extent made for
interruption of business, moving expenses or any property owned by Lessee that
is not part of the Leased Property hereinafter referred to as Lessee's Loss),
and Lessee shall retain any award applicable thereto. All amounts so paid or
payable to Lessor or Lessee shall be retained by, or paid over to, the party
entitled thereto in accordance with the provisions of this Article 12.
(b) If any part of the Leased Property shall be condemned or taken in the
exercise of the power of eminent domain by any sovereign, municipality or other
public or private authority or shall be damaged or destroyed by fire or other
casualty, and Lessee may not, or does not, elect to terminate the Lease with
respect to the Leased Property pursuant to paragraph (c) of this Article 12,
then Lessee shall give prompt written notice of such condemnation or casualty to
Lessor and shall, at Lessee's own cost and expense, proceed with diligence and
promptness to carry out any necessary demolition and to restore, repair,
replace, and/or rebuild the Leased Property in order to restore the Leased
Property, as nearly as practicable, to a condition and fair market value not
less than the condition required to be maintained and fair market value thereof
immediately prior to such taking, damage or destruction. No repair work done by
Lessee pursuant to this paragraph shall violate the terms of any restriction,
easement, condition or covenant or other matter affecting title to the Leased
Property, and shall be undertaken and completed in a good and workmanlike manner
and in compliance in all material respects with the requirements of Article 10
and with all Legal Requirements then in effect with respect to the Leased
Property. No work done in accordance with this paragraph (b) of Article 12 shall
violate the requirements of all insurance policies required to be maintained
pursuant to this Lease.
Basic Rent and Additional Rent shall not xxxxx hereunder by reason of any
taking of, damage to or destruction of the Leased Property, and this Lease shall
continue in full force and effect and Lessee shall continue to perform and
fulfill all of Lessee's obligations, covenants and agreements hereunder
notwithstanding such taking, damage or destruction.
If a Default or Event of Default is continuing hereunder, Lessor shall
retain the Net Award (as defined in paragraph (c) of this Article 12) to be
applied to effect compliance with Lessee's obligations under Article 22 and the
Net Award will be applied on account of and credited against Lessee's
obligations under Article 22. If the Net Award is less than the estimated cost
of restoring or rebuilding the Improvements on the Leased Property to the
condition and fair market value required above in this paragraph (b), and Lessee
shall not be qualified to be the Depositary, as provided below, then Lessee
shall deposit the amount by which such estimated cost exceeds the Net Award with
Fleet or shall post an equivalent bond, whereupon such deposit or bonded amount
shall be part of the Net Award for purposes of this paragraph (b). If the Net
Award does not exceed $1,000,000, provided that there is no Default or
23
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Event of Default continuing hereunder, then the Net Award shall be promptly paid
to Lessee to be applied to the repair and rebuilding work required by this
paragraph (b). If the Net Award exceeds $1,000,000, provided that there is no
Default or Event of Default continuing hereunder, then:
(i) the full amount thereof shall be paid to Fleet (the Depositary). The
Depositary shall have no affirmative obligation to prosecute a
determination of the amount of, or to effect the collection of, any
insurance proceeds or condemnation award or awards, unless the
Depositary shall have given an express written undertaking to do so
and shall have obtained the consent of Lessee. Moneys received by the
Depositary pursuant to the provisions of this Lease shall not be
commingled with the Depositary's own funds and shall be held by the
Depositary in trust separately for the uses and purposes provided in
this Lease. The Depositary shall place any moneys held by it into an
interest bearing account; any interest paid or received by the
Depositary on the moneys so held in trust shall be paid Lessee unless
an Event of Default shall have occurred and be continuing, in which
case such interest shall be added to the moneys so held in trust by
the Depositary. In disbursing monies pursuant to clause (ii) of this
paragraph (b), the Depositary may rely conclusively on the information
contained in any notice given to the Depositary by Lessee in
accordance with the provisions of said clause (ii), unless Lessor
shall notify the Depositary in writing as provided in said clause (ii)
that Lessor intends to dispute such information, in which case the
disputed amount shall not be disbursed but shall continue to be held
by the Depositary until such dispute shall have been resolved.
(ii) Lessee may request payment out of the Net Award for the actual costs
and expenses incurred by Lessee in connection with such repair and
rebuilding. Such requests shall be made by written notice to the
Depositary, with a copy to Lessor, setting forth in reasonable detail
all of such costs and expenses then incurred by Lessee. The Depositary
shall promptly disburse (but not prior to the expiration of the five
Business Day period set forth in the last sentence of this clause (ii)
and not at any time during which a dispute shall exist between Lessor
and Lessee as to such amount) to Lessee out of the Net Award the
amount of such costs and expenses. If Lessor shall in good faith
desire to dispute the information contained in any notice given by
Lessee pursuant to this clause (ii), Lessor shall so notify Lessee and
the Depositary in writing within five business days after the giving
of such notice (the Dispute Notice), specifying the amount intended to
be disputed and the nature of the dispute, and Lessor and Lessee shall
negotiate in good faith to promptly settle any such dispute. Within
five days after delivery of the Dispute Notice, a duly authorized
representative of Lessee and Lessor shall meet to discuss and to
attempt to resolve such dispute. If no such resolution has been
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reached within 15 days after delivery of the Dispute Notice, the
dispute shall be referred to the Applicable Officer of Lessee and to
the most senior authorized representative of Lessor charged with the
administration of this Lease for resolution. Such officers shall meet
to discuss and attempt to resolve such dispute within 10 days after
the expiration of such 15 day period. If such parties are unable to
agree on an appropriate resolution within 15 days after the end of
such 15 day period, both parties may pursue any rights and remedies
they may have hereunder, at law or in equity, and the Depositary shall
hold such amounts in trust for Lessor and Lessee pending the outcome
thereof.
(iii) After reimbursement pursuant to clause (ii) above, any remaining Net
Award shall be paid to Lessee.
(iv) Lessee may direct the investment of the amounts deposited with the
Depositary pursuant to clause (i) above in the following:
(A) repurchase obligations of Fleet or one or more financial
institutions reasonably acceptable to Lessor at all times fully
secured by direct and general obligations of the United States of
America or obligations guaranteed as to principal and interest by
the United States of America;
(B) direct and general obligations of the United States of
America or obligations guaranteed as to principal and interest by
the United States of America purchased at a price of not more
than par;
(C) certificates of deposit of Fleet or one or more financial
institutions reasonably acceptable to Lessor at all times insured
by the Federal Deposit Insurance Corporation or collateralized by
obligations of the types described in the foregoing clauses (A)
and (B); or
(D) commercial paper which is rated "A-1" or better (or
comparable ratings) by S&P or "P-1" or better (or comparable
ratings) by Xxxxx'x, or the successors to such rating
organizations.
(E) interests in mutual funds, substantially all of the assets of
which shall be one or more obligations of the type described in
the preceding clauses (B), (C) or (D).
Such investments of such funds shall mature in such amounts and
on such dates as to provide that amounts sufficient to pay the
amounts requested, and due to, Lessee shall be available on the
due dates. The Depositary
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shall not be liable for any loss resulting from the liquidation
of any such investment in order to pay such amounts. The Lessee
shall be responsible for any loss of principal as a result of any
investments Lessee has directed the Depositary to make.
(c) If, (i) at any time prior to the Completion Date, the Leased Property,
or any portion thereof, shall be condemned or taken in the exercise of the power
of eminent domain by any sovereign, municipality or other public or private
authority or shall be damaged or destroyed by fire or other casualty, and Lessee
shall determine in its reasonable good faith judgment, using such experts as
Lessee shall deem necessary or desirable, that, on account of such condemnation,
damage or destruction, the Project cannot be Substantially Complete by the
Completion Date, or (ii) at any time during the Term of this Lease from and
after the Completion Date, all or "substantially all" (as defined below) of the
Leased Property shall be condemned or taken in the exercise of the power of
eminent domain by any sovereign, municipality or other public or private
authority or shall be damaged or destroyed by fire or other casualty and Lessee
shall have, in good faith, determined that such condemnation, taking or casualty
has rendered the Leased Property permanently unsuitable for continued use in
Lessee's business for operations similar to those utilized by Lessee prior to
the casualty or condemnation in question, and in the case of either of the
foregoing clause (i) or clause (ii) shall have provided to Lessor an Officer's
Certificate to that effect, then so long as there is no Event of Default
continuing hereunder, Lessee may give notice to Lessor of Lessee's intention to
purchase the Leased Property for the Termination Value.
"Substantially all" of the Leased Property shall be deemed to have been
condemned, damaged, destroyed or taken, as the case may be, if Lessee shall
have, in good faith, determined that the remaining portion of the Leased
Property or access thereto shall not be of sufficient size or character to
permit the continued operation by Lessee of its business operations on an
economically feasible basis, assuming that such remaining portion had been
repaired and restored to the fullest extent reasonably practicable.
If, pursuant to the foregoing provisions of this paragraph (c) of this
Article 12, Lessee shall have determined not to restore the Leased Property,
then Lessee shall give notice to Lessor of Lessee's intention to terminate this
Lease with respect to the Leased Property not later than 120 days after the
occurrence of such condemnation or taking or 120 days after the occurrence of
such casualty (subject to reasonable extension in the event the insurer has not
notified Lessee within 30 days after the occurrence of any such casualty
regarding the amount of proceeds to be awarded under the applicable insurance
policy), whichever is applicable. Lessee's notice to Lessor shall (i) contain a
description of the relevant condemnation, taking or casualty, (ii) specify the
date on which this Lease shall terminate with respect to the Leased Property
which shall be the Payment Date, next occurring that is at least 30 days after
such notice is given (the Termination Date), and (iii) contain the irrevocable
commitment of Lessee to purchase Lessor's
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interest in the Leased Property (and, if applicable, the Net Award hereinafter
referred to), on such Termination Date for the Termination Value. On such
Termination Date Lessor shall transfer, and Lessee shall purchase, Lessor's
interest in the Leased Property (and the Net Award, if applicable) in accordance
with the provisions of Article 16 hereof. Upon completion of such purchase, and
payment by Lessee of the Termination Value, and any other sums owed by Lessee
pursuant to paragraph b(iii) of Article 16 hereof, the entire award,
compensation, insurance proceeds or other payment, if any, on account of any
such condemnation, taking or casualty, less any expenses reasonably incurred by
Lessor in collecting such award, compensation, insurance proceeds or other
payment and not already paid (or reimbursed to Lessor) by Lessee pursuant to
paragraph (a) of Article 12, shall be paid and belong to Lessee (such award,
compensation, insurance proceeds or other payment, less such expenses, plus, in
the case of any award with respect to a condemnation or taking, any investment
income earned with respect to the foregoing amounts, being herein called the Net
Award).
(d) Notwithstanding any other provision to the contrary contained in this
Article 12, in the event of a temporary condemnation with respect to the Leased
Property, this Lease shall remain in full force and effect and Lessee shall be
entitled to the Net Award allocable to such temporary condemnation; except that
any portion of the Net Award allocable to the time period after the expiration
or termination of the Term of this Lease with respect to the Leased Property
shall be paid to Lessor and held by Lessor until Lessee purchases the Leased
Property pursuant to this Lease.
(e) Lessor agrees to send to Lessee promptly after actual receipt by
Lessor a copy of any notice with respect to any condemnation affecting the
Leased Property, but failure to do so by Lessor shall not excuse performance by
Lessee hereunder or otherwise limit or affect in any way whatsoever Lessee's
obligations hereunder.
13. INSURANCE.
(a) Lessee shall, during the Term, at its cost and expense, maintain or
cause to be maintained insurance of the following character and shall cause to
be delivered to Lessor annual certificates of the insurers as to such coverage:
(i) "all risks" property insurance (including flood insurance if the
Leased Property is located in a flood hazard zone) covering the Leased
Property and all replacements and additions thereto, and all building
materials and other property which constitute part of the Leased
Property in a manner consistent with insurance maintained by Lessee on
properties similar to the Leased Property and in any event in amounts
not less than the actual replacement cost of the Leased Property
(without depreciation) less land and other uninsurable items.
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(ii) public liability insurance covering liability against claims for
bodily injury, death or property damage, occurring on, in or about the
Leased Property and the adjoining land, streets, sidewalks or ways or
occurring as a result of construction and use and occupancy of
facilities located on the Leased Property or as a result of the
rehabilitation or construction thereof or the use of products or
materials manufactured, processed, constructed or sold, or services
rendered, on the Leased Property, in the minimum amount of $5,000,000
with respect to any one occurrence, accident or disaster or incidence
of negligence. Coverage should include "premises/operations",
"independent contractors", and "blanket contractual" liabilities.
(iii) builder's risk coverage insurance in amounts appropriate for the
construction work being undertaken during the Construction Term and
thereafter during the course of any construction, rehabilitation or
repair of any Improvements (including construction or rehabilitation
underway as of the date hereof) against "all risks", including
collapse and transit coverage, during construction, rehabilitation or
repair of such Improvements, covering the total value of work
performed and equipment, supplies and materials furnished, in an
amount equal to the actual replacement cost of such Improvements
(without depreciation) less uninsurable items.
(iv) worker's compensation insurance (or other similar insurance or self
insurance program permitted and in compliance with the laws of the
Commonwealth of Massachusetts) covering all Persons employed by Lessee
in connection with any work done on or about the Leased Property with
respect to which claims for death or bodily injury could be asserted
against Lessor, Lessee or the Leased Property, complying with the laws
of the Commonwealth of Massachusetts.
(v) such other insurance, in such amounts, against such risks, and with
such other provisions as is customarily and generally maintained by
operators of similar properties of a financial standing similar to
Lessee in similar locations, when and to the extent obtainable.
Such insurance shall be effected under standard or manuscript form
policies, issued by insurers of recognized responsibility authorized to do
business in the Commonwealth of Massachusetts which are well rated by national
rating authorities naming Lessor and Beneficiary as additional insured with
respect to insurance described in clauses (ii) or, to the extent applicable (v)
above and shall name Lessor, Beneficiary and Lessee as loss payees, as their
interests may appear, with respect to insurance described in clauses (i), (iii)
or, to the extent applicable, clause (v) above. Such insurance may provide for
deductible amounts of up to $250,000 per occurrence.
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(b) [Intentionally Omitted.]
(c) In addition to the foregoing, every insurance policy maintained in
accordance with clauses (i) or (iii) of paragraph (a) of this Article 13 shall
provide that the issuer waives all rights of subrogation against Lessor, and any
successor to Lessor's interests in the Leased Property, and every insurance
policy maintained in accordance with clauses (i), (ii), (iii) or (v) of
paragraph (a) of this Article 13 shall: (i) provide that 30 days advance written
notice of cancellation, modification, termination or lapse of coverage shall be
given to Lessor, and that such insurance, as to the interest of Lessor, shall
not be invalidated by any act or neglect of Lessor, Lessee or any party, nor by
any foreclosure or any other proceedings relating to the Leased Property, nor by
use or occupation of the Leased Property for purposes more hazardous than are
permitted by such policy; (ii) be primary and without right or provision of
contribution as to any other insurance carried by Lessor or any other interested
party; and (iii) in the event any insuring company is not domiciled within the
United States of America, include a United States Service of Suit clause
(providing any actions against the insurer by the named insured or Lessor are
conducted within the jurisdiction of the United States of America).
(d) Nothing in this Article 13 shall prevent Lessee from taking out
insurance of the kind and in the amount provided for under the preceding
paragraphs of this Article under a blanket insurance policy (which policy or
certificates thereof acceptable to Lessor shall be delivered to Lessor) which
may cover other properties owned, operated, leased or occupied by Lessee as well
as the Leased Property; provided, however, that any such blanket insurance of
the kind provided for shall not contain any clause which would result in the
insured thereunder being required to create a reserve or carry any insurance
with respect to the property covered thereby in an amount not less than any
specific percentage of the actual replacement cost of such property in order to
prevent the named insureds from becoming a co-insurer of any loss with the
insurer under such policy. Further, such policies of blanket insurance shall, as
respects the Leased Property, contain the various provisions required of such an
insurance policy by the foregoing provisions of this Article 13.
(e) Lessee shall not obtain or carry separate insurance concurrent in form
or contributing in the event of loss with that required in this Article 13 to be
furnished by Lessee, unless Lessor is included therein as an additional insured,
with loss payable as in this Lease provided and otherwise complying with the
requirements of paragraph (c) of this Article 13. Lessee shall immediately
notify Lessor whenever any such separate insurance is obtained and shall deliver
to Lessor certificates of insurers evidencing such insurance.
(f) Lessee shall deliver to Lessor prior to the execution of this Lease
certificates of insurers, evidencing all of the insurance required under
paragraph (a) of Article 13 hereof. Lessee shall, in connection with the
expiration of any required insurance policy, deliver to Lessor, certificates
(and upon written request, actual policies) of insurers evidencing the renewal
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of any such policy. If Lessee fails to maintain or renew any insurance required
by this Lease, or to pay the premium therefor, or to so deliver any such
certificate, then Lessor, at its option, but without obligation to do so, may,
upon ten Business Days' notice to Lessee, procure such insurance, pay such
premium or deliver such certificate. Any sums so expended by Lessor shall be
Additional Rent hereunder and shall be repaid by Lessee within five Business
Days after notice to Lessee of such expenditure and the amount thereof. With
respect to any insurance policy required to be maintained pursuant to this
Lease, upon request of Lessor, Lessee shall deliver to such requesting party a
copy of such insurance policy.
(g) Lessee shall comply with all of the terms and conditions of each
insurance policy maintained pursuant to the terms of this Lease, to the extent
necessary to avoid invalidating such insurance policy or impairing the coverage
available thereunder. In the event of the termination of this Lease as herein
provided or Lessee's abandonment of the Leased Property, the obligations and
liabilities of Lessee with respect to each Indemnified Party, actual or
contingent, under this Lease shall survive such termination or abandonment;
provided, however, Lessee shall only be required to maintain the insurance set
forth in Section 13 (a) (ii) above for twelve years after the termination of
this Lease.
14. FINANCIAL STATEMENTS; OTHER INFORMATION.
(a) Lessee will deliver to Lessor and Beneficiary the following financial
statements of Lessee described below. Lessee shall deliver (i) at any time that
Lessee is a public company, (A) as soon as practicable, copies of all such
financial statements, proxy statements, notices, other communications and
reports as Lessee shall send on a regular basis to its shareholders and other
information, if any, generally made available to banks and other lenders and (B)
copies of all regular, current or periodic reports (including reports on Form
10-K, Form 8-K and Form 10- Q) which Lessee is at any time required to file with
the Securities and Exchange Commission or any governmental body or agency
succeeding to the functions of the Securities and Exchange Commission; and (ii)
at any time that Lessee is not a public company required to file reports with
the Securities and Exchange Commission containing such financial statements, as
soon as practicable and in any event within 90 days after the end of each Fiscal
Year, and within 45 days after the end of any other Fiscal Quarter or shorter
period, a consolidated statement of income, and a consolidated statement of cash
flows, a consolidated statement of shareholder equity, and a consolidated
balance sheet of Lessee as at the end of each such year or Fiscal Quarter or
shorter period, setting forth in each case in comparative form the corresponding
consolidated figures from the preceding annual audit or corresponding Fiscal
Quarter or shorter period in the prior Fiscal Year, as appropriate, all in
reasonable detail and certified to Lessee as to the annual consolidated
statements by independent public accountants of recognized national standing
selected by Lessee, whose certificate shall be based upon an examination
conducted in accordance with generally accepted auditing standards and the
application of such tests as said accountants deem necessary under the
circumstances. Concurrently with the delivery of annual
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financial statements pursuant hereto, Lessee will deliver to Lessor and
Beneficiary an Officer's Certificate that there exists no Default or Event of
Default under this Lease or the Agency Agreement, or if any such Default or
Event of Default exists, specifying the nature thereof, the period of existence
thereof and what action Lessee proposes to take with respect thereto. Lessee
will keep adequate records and books of account reflecting all its financial
transactions with respect to this Lease and the transactions contemplated
hereby. In addition, Lessee agrees upon prior written request to meet with
Lessor or Beneficiary, during normal business hours at mutually convenient
times, from time to time, to discuss this transaction and Lessee's business and
financial condition generally.
(b) Lessee shall deliver or cause to be delivered to Lessor and
Beneficiary, such additional information with respect to Lessee, the Leased
Property, this Lease and the transactions contemplated hereby, as Lessor and
Beneficiary may reasonably request from time to time.
15. FINANCIAL COVENANTS; MERGERS; ACQUISITIONS; ASSET SALES.
A. Lessee hereby covenants and agrees that Lessee shall be in compliance
with the following tests:
(a) LIQUIDITY RATIO. At the end of each Fiscal Quarter, the Liquidity
Ratio shall be not less than 1.5 to 1.
(b) TANGIBLE CAPITAL BASE. At all times the Tangible Capital Base of
Lessee will be not less than $60,000,000.
(c) DEBT SERVICE COVERAGE. At the end of each Fiscal Quarter, Lessee's
Debt Service Coverage will be not less than 2.0 to 1, PROVIDED, HOWEVER, that in
the event Lessee is unable to maintain the Debt Service Coverage required by
this subsection (c) Lessee shall not be in Default hereunder if Lessee's Cash
and Cash Equivalents shall total not less than $50,000,000 on or before October
31, 2000 and $40,000,000 thereafter.
(d) Lessee shall determine its Liquidity Ratio, Tangible Capital Base and
Debt Service Coverage as of the last day of each of its Fiscal Quarters and,
within 45 Business Days of the end of such quarter deliver an Officer's
Certificate to Lessor, Beneficiary and Fleet showing the results of such
determination in sufficient detail to permit Lessor, Beneficiary and Fleet to
evaluate such determination. Nothing contained in the preceding sentence shall
effect Lessee's obligations to maintain, in compliance with the next previous
paragraph (a), its Tangible Capital Base at all times other than such last day
of each of its fiscal quarters. Lessee agrees to inform Fleet of any occurrence
which has or would be likely in the future to cause Lessee to violate its
covenants contained in paragraphs 15A(a) through (c).
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(e) DEFINITIONS. As used in this Article 15, the following terms have the
meanings set forth below. In the event that any term used in paragraph 15(A)(a)
through (c) or a definition thereof shall not be defined in this paragraph
15A(e), such term shall have the meaning defined in Article 31 of this Lease or
if not so defined, shall have the meaning assigned thereto by GAAP.
(i) ACCOUNTS RECEIVABLE means, collectively, any account receivable
determined in accordance with GAAP which (v) has not been acquired from any
other Person, (w) is not subject to any lien in favor of any Person, (x) is a
valid, binding and legally enforceable obligation of the Person who is obligated
thereunder, (y) is not outstanding more than 90 days past the invoice date
thereof, and (z) the obligor thereunder is not a Subsidiary or an Affiliate of
Lessee.
(ii) CAPITAL ASSET means each asset which would properly be classified
as a capital asset on a balance sheet of the Person owning such asset, in
accordance with GAAP, including, without limitation, all fixed assets and
investments consisting of the capital stock or Indebtedness of any other Person.
(iii) CASH EQUIVALENT means any debt of any Person other than an
Affiliate or Subsidiary of Lessee, due within 30 days of the date of
determination and otherwise has the meaning assigned to it by GAAP.
(iv) CONTINGENT OBLIGATION means, as applied to any Person, any direct
or indirect liability, contingent or otherwise, of that Person with respect to
any Indebtedness or contractual obligation of another Person, if the purpose or
intent thereof by the Person incurring the Contingent Obligation is to provide
assurance to the obligee of such Indebtedness or contractual obligation that
such Indebtedness or contractual obligation will be paid or discharged, or that
any agreements relating thereto will be complied with, or that the holders of
such Indebtedness or contractual obligation will be protected (in whole or in
part) against loss in respect thereof. Contingent Obligations include, without
limitation, (a) the direct or indirect guarantee, endorsement (other than for
collection or deposit in the ordinary course of business), co-making,
discounting with recourse or sale with recourse by such Person of the obligation
of another Person, and (b) any liability of such Person for the obligations of
another Person through any agreement (contingent or otherwise) (i) to purchase,
repurchase or otherwise acquire such obligation or any security therefor, or to
provide funds for the payment or discharge of such obligation (whether in the
form of loans, advances, stock purchases, capital contributions or otherwise),
(ii) to maintain the solvency or any balance sheet item, level of income or
financial condition of another, or (iii) to make take-or-pay or similar
payments, if required regardless of nonperformance by any other party or parties
to an agreement, if in the case of any agreement described under subclause (i),
(ii) or (iii) of this sentence, the primary purpose or intent thereof is
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as described in the preceding sentence. The amount of any Contingent Obligation
shall be equal to the amount of the obligation so guaranteed or otherwise
supported.
(v) CURRENT MATURITIES OF LONG TERM DEBT means the amount payable in
respect of long term debt (as defined by GAAP), as principal, during the next
succeeding Fiscal Quarter subsequent to date of determination.
(vi) DEBT SERVICE COVERAGE means as of the last day of each Fiscal
Quarter of Lessee, EBITDA during the preceding four Fiscal Quarters, divided by
the sum of Current Maturities of Long Term Debt plus Interest Expense during
such preceding four Fiscal Quarters.
(vii) EBITDA means, as to the Lessee and in respect of any fiscal
quarter, an amount equal to (a) net income determined on a FIFO basis for such
period, PLUS (b) depreciation and amortization expense and other non-cash
charges for such period, PLUS (c) Interest Expense during such period, PLUS (d)
an amount equal to the Lessee's income tax expense as reflected on the Lessee's
books of account during such period, PLUS (e) any items of loss which are
extraordinary items as defined by GAAP, MINUS (f) any items of gain which are
extraordinary items as defined by GAAP.
(viii) FIFO means the first-in-first-out method of determining value
of Inventory in accordance with GAAP.
(ix) INDEBTEDNESS of any Person means, (a) all indebtedness of such
Person for borrowed money or for the deferred purchase price of property or
services (including without limitation, reimbursement and all other obligations
with respect to surety bonds, letters of credit and bankers' acceptances,
whether or not matured), (b) all obligations evidenced by notes, bonds,
debentures or similar instruments, (c) all indebtedness created or arising under
any conditional sale or other title retention agreement with respect to property
acquired by such Person (even though the rights and remedies of the seller or
Lender under such agreement in the event of default are limited to repossession
or sale of such property), (d) all Capitalized Lease Obligations, (e) all
Contingent Obligations, (f) all Indebtedness referred to in clause (a), (b),
(c), (d) or (e) above secured by (or for which the holder of such Indebtedness
has an existing right, contingent or otherwise, to be secured by) any lien upon
property (including, without limitation, accounts and contracts rights) owned by
such Person, even though such Person has not assumed or become liable for the
payment of such Indebtedness, (g) the obligation to pay due and unpaid
Additional Rent hereunder, and (h) the amount at which any redeemable preferred
stock of such Person is required to be redeemed.
(x) INTANGIBLE ASSETS means the SUM of (a) all goodwill,
organizational expenses, trademarks, trade names, copyrights, patents, patent
applications, licenses and rights in any thereof, and other similar intangibles,
(b) securities which are not Readily Marketable
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Securities, and (c) any items not included in the preceding clauses (a) and (b)
which are treated as intangibles in conformity with GAAP.
(xi) INTEREST EXPENSE means, as to the Lessee and in respect of any
Fiscal Quarter, an amount equal to the total amount of all interest accrued on
Indebtedness of the Lessee during such period.
(xii) LIFO means the last-in-first-out method of determining value of
Inventory in accordance with GAAP.
(xiii) LIQUIDITY RATIO means the ratio of cash, Cash Equivalents,
Readily Marketable Securities and Accounts Receivable to Total Liabilities.
(xiv) READILY MARKETABLE SECURITIES means securities issued by any
Person which is not an Affiliate or Subsidiary of Lessee which (i) is subject to
a repurchase obligation within the next 60 days from any bank subject to the
FDIC (ii) would be an investment permitted by clauses (i) through (v) of
paragraph (d) of Article 15(B) or (iii) or as to which an over the counter or
formal security market exists from which quotations as to the value of such
securities may be obtained and is not subject to any lien in favor of any
Person.
(xv) SHAREHOLDERS EQUITY means with respect to any Person, the equity
of shareholders of any such Person, determined on a consolidated basis in
accordance with GAAP.
(xvi) SUBORDINATED DEBT means any Indebtedness no portion of which
would be payable after an Event of Default hereunder until all payments
(including but not limited to Basic Rent and Additional Rent) payable under this
Lease had been paid in full.
(xvii) TANGIBLE CAPITAL BASE means Shareholders Equity plus
Subordinated Debt less Intangible Assets.
(xviii) TOTAL LIABILITIES means, as to Lessee as of a given date, the
total consolidated liabilities of Lessee, determined in accordance with GAAP.
B. At all times during the Term:
(a) SALES OF CAPITAL ASSETS. Without the reasonable consent of Lessor,
Lessee and any of its Subsidiaries may only sell only those Capital Assets which
it is selling in the ordinary course of its business.
(b) MERGERS AND CONSOLIDATIONS. Lessee shall not, and shall not permit any
of its Subsidiaries to, consolidate with or merge with or into any other
corporation or entity, or permit
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any other corporation or entity to consolidate with or merge with or into the
Lessee or any such Subsidiary; except that (i) any corporation may merge into
the Lessee or any of its Subsidiaries and any Subsidiary may merge into another
corporation if, contemporaneously therewith, such corporation becomes a
Subsidiary of the Lessee, PROVIDED that, after consummation of such merger, (A)
no Default or Event of Default shall exist, and (B) the Lessee or its Subsidiary
shall be the surviving corporation, (ii) the Lessee may merge or consolidate one
or more Subsidiaries with and into the Lessee or with and into another of its
Subsidiaries, and (iii) the Lessee may liquidate or dissolve any of its
Subsidiaries.
(c) GUARANTIES. Lessee will not, without the prior written consent of
Lessor, assume, guaranty, endorse, or otherwise become directly or contingently
liable (including without limitation, liable by way of agreement, contingent or
otherwise, to purchase, to provide funds for payment, to supply funds to or
otherwise invest in any debtor or otherwise to assure any creditor against loss)
(and will not permit any of its Subsidiaries so to assume, guaranty or become
directly or contingently liable) in connection with any indebtedness of any
other Person, except (i) guaranties by endorsement for deposit or collection in
the ordinary course of business, and (ii) guaranties existing at the date hereof
and disclosed to Lessor.
(d) LIMITATION ON INVESTMENTS AND CAPITAL EXPENDITURES. Lessee will not,
without Lessor's prior written consent, invest in, hold or purchase any stock or
securities of any Person (nor will the Borrower permit any of its Subsidiaries
to invest in, purchase or hold any such stock or securities) except: (i) readily
marketable direct obligations of, or obligations guarantied by, the United
States of America or any agency thereof; (ii) securities of United States
corporations with a minimum Xxxxx'x rating of A; (iii) traditional money market
instruments with a minimum rating of A1/P1; (iv) institutional money market
funds, the assets of which are primarily invested in items of the kind described
in the foregoing clauses (i), (ii) and (iii) of this paragraph (d); (iv)
deposits with or certificates of deposit issued by Beneficiary and any other
obligations of Beneficiary or Beneficiary's parent; (v) deposits in any other
bank organized in the United States having capital in excess of $100,000,000;
(in each of cases (i) through (v) having maturity of less than two years) (vi)
investments in any Subsidiaries now existing or hereafter created by the
Borrower, (vii) any investment in an equity interest of another person made for
strategic reasons relating to Lessee's biotechnology business provided that the
total amount so invested in any one Person shall not exceed $50,000 and the
aggregate of all such investments shall not exceed $250,000; and (viii) with
Lessor's consent investments in any entity created by Lessee (alone or with a
third party) to which Lessee contributes any of its intellectual property in
return for an equity investment for reasonable consideration; provided that
Lessee does not guaranty or is otherwise liable for any indebtedness incurred by
such entity.
16. PURCHASE PROCEDURE.
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(a) In the event of the purchase of the Leased Property by Lessee pursuant
to any provision of this Lease, the terms and conditions of this Article 16
shall apply.
(b) On the closing date fixed for the purchase of the Leased Property:
(i) Lessee shall pay to Lessor, in lawful money of the United States in
immediately available funds, at Lessor's address hereinabove stated or
at any other place in the continental United States which Lessor may
designate, the Purchase Price pursuant to Article 28 or Termination
Value and related amounts required to be paid pursuant to Article 9,
paragraph (c) of Article 12 or paragraph (a) or (b) of Article 17 or
paragraph (c) or (h) of Article 22, whichever is applicable; and
(ii) Lessor shall execute and deliver to Lessee or Lessee's designee good
and sufficient quitclaim deeds, assignments and/or such other
instrument or instruments as may be appropriate, which shall transfer
the Leased Property, including any rights of Lessor against any party
through whom Lessor derived its title to the Leased Property, subject
to (A) any encumbrances existing on the Construction Term Commencement
Date, (B) Permitted Encumbrances (other than this Lease, unless Lessee
requests that this Lease remain), (C) all liens, encumbrances,
charges, exceptions and restrictions attaching to the Leased Property
after the Construction Term Commencement Date (other than Lessor Liens
created without the consent of Lessee), and (D) all Legal
Requirements. In the case of a purchase of the Leased Property by
Lessee pursuant to paragraph (c) of Article 12 hereof, Lessor shall
also pay to Lessee the Net Award, if any and assign to Lessee all
rights to any award not yet received; and
(iii) Lessee shall pay all charges incident to such transfer, including but
not limited to all transfer taxes, recording fees, title insurance
premiums and federal, state and local taxes, (except for any Excluded
Taxes), and reasonable attorneys' fees and expenses of Lessor's
counsel; and
(iv) Except as otherwise provided herein, this Lease shall terminate and be
of no further force and effect.
17. FAILURE TO COMPLETE; PURCHASE DURING TERM.
(a) If the Project is not Substantially Complete or Lessee shall not have
certified such fact to Lessor pursuant to Article 35, on or before the
Completion Date for any reason whatsoever, so long as no other Default or Event
of Default shall have occurred and be continuing hereunder, then Lessor shall
not exercise its remedies under Article 22 hereof with respect to such failure
of the Project to be Substantially Complete so long as not later than the
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tenth business day prior to the Completion Date Lessee shall have delivered to
Lessor a written notice (the Non-Completion Termination Notice) specifying the
exercise by Lessee of its option either (i) to purchase the Leased Property
pursuant to Article 28 or (ii) to Terminate the Lease 140 days after the
Completion Date (also a Term Termination Date) subject to the terms of Article
28. Time shall be of the essence in delivering any Non-Completion Termination
Notice.
(b) So long as Lessee shall not be in Default under clause (iii), (iv) or
(v) of Article 22, Lessee shall have the option, exercised by a written notice
to Lessor delivered not less than 90 days prior to the proposed date of purchase
to purchase the Leased Property on any Payment Date.
(c) The purchase price for the Leased Property payable by Lessee pursuant
to this Article 17 shall be equal to the Purchase Price.
18. QUIET ENJOYMENT. So long as no Event of Default under this Lease shall
have occurred and be continuing, Lessor covenants (subject to the first sentence
of Article 5 hereof) that Lessee shall and may at all times peaceably and
quietly have, hold and enjoy the Leased Property during the Term.
Notwithstanding the preceding sentence, Lessor may exercise its rights and
remedies under paragraph (b) of Article 22 and Lessor or its agents may enter
upon and inspect the Leased Property in accordance with the provisions of
Article 11. Lessor shall keep the Leased Property free of Lessor Liens. Any
failure by Lessor to comply with the foregoing warranty shall not give Lessee
any right to cancel or terminate the Lease, or to xxxxx, reduce or make
deduction from or offset against any Basic Rent or Additional Rent or other sum
payable under this Lease, or to fail to perform or observe any other covenant,
agreement or obligation hereunder. Subject to the foregoing sentence, Lessee
shall have the right to obtain injunctive or other relief against Lessor for
breach of the aforesaid covenant of peaceful and quiet possession and enjoyment
of the Leased Property.
19. SURVIVAL. In the event of the termination of this Lease with respect
to the Leased Property, as herein provided, the obligations and liabilities of
Lessee, actual or contingent, under this Lease which arose at or prior to such
termination shall survive such termination unless otherwise expressly provided
herein.
20. SUBLETTING; ASSIGNMENT.
(a) Subject to paragraphs (c) and (d) of this Article 20, Lessee may
sublet the Leased Property or any portion or portions thereof, provided that (i)
no Default or Event of Default under this Lease has occurred and is continuing
on the date such sublease is entered into, (ii) each sublease shall expressly be
made subject and subordinate to the provisions of this Lease and shall be
expressly subject to termination in the event this Lease is terminated pursuant
to Article 28(b), Article 30(b) or an Event of Default hereunder, and (iii) each
such sublease shall
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contain standards with regard to maintenance, repair, use, condition upon
surrender and other matters relevant to the Leased Property, which are no less
strict than those hereunder, and shall prohibit further subleasing.
(b) Lessee may not assign its interest under this Lease except to a
Subsidiary or an Affiliate or with the prior written consent of Lessor, which
consent may be withheld in Lessor's sole and absolute discretion, and subject to
paragraphs (c) and (d) of this Article 20 and provided that such assignment
shall expressly be made subject and subordinate to the terms of this Lease.
(c) No such sublease or assignment shall affect or reduce any obligations
of Lessee or rights of Lessor hereunder, and all obligations of Lessee hereunder
shall continue in full effect as the obligations of a principal and not of a
guarantor or surety, as though no subletting or assignment had been made.
(d) Lessee shall, (i) at least 30 days prior to the execution of any
sublease, deliver to Lessor notice of Lessee's intention to sublet in each case,
which shall include the identity of the sublessee or proposed sublessee, as the
case may be, and stating that such sublease complies with the provisions of this
Article 20 and contains the express subordination required thereby and that
Lessee has made a good faith determination that such sublease does not adversely
affect the fair market value of the Leased Property, or the utility or useful
life of the Leased Property and (ii) within 30 days after such execution, shall
so deliver a conformed copy of such sublease (with acknowledgments) and a
conformed copy of any short form lease or memorandum of lease which has been
prepared for recording purposes.
(e) This Lease shall not be mortgaged by Lessee, nor shall Lessee mortgage
or pledge the interest of Lessee in and to any sublease of the Leased Property
or any portion thereof or the rental payable thereunder. Any such prohibited
mortgage or pledge, and any sublease or assignment not permitted by this Article
20, shall be void.
21. ADVANCES BY LESSOR. If Lessee shall fail to make or perform any
payment or act required by this Lease, then, upon 30 days' notice to Lessee (or
upon shorter notice, or with no notice at all, to the extent necessary to meet
an emergency or a governmental or municipal time limitation, Lessor may at its
option make such payment or perform such act for the account of Lessee, and
Lessor shall not thereby be deemed to have waived any default or released Lessee
from any obligation hereunder. Lessor shall give Lessee prompt notice of any
such payment or act including the amount and payee, but failure to give such
notice shall not impair Lessor's rights to reimbursement for amounts so paid or
otherwise limit Lessee's obligations hereunder in any way whatsoever. Amounts so
paid by Lessor and all incidental costs and expenses (including reasonable
attorneys' fees and expenses) incurred in connection with such payment or
performance, together with interest thereon at the Overdue Rate with respect to
Additional Rent
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provided in Article 3, from the date advanced through the date repaid by Lessee,
shall constitute Additional Rent and shall be paid by Lessee to Lessor on
demand.
22. CONDITIONAL LIMITATIONS -- EVENTS OF DEFAULT AND REMEDIES.
(a) Any of the following occurrences or acts shall constitute an Event of
Default under this Lease and if Lessee has actual knowledge thereof Lessee shall
notify Lessor within five days of obtaining such knowledge of the occurrence
thereof:
(i) if Lessee shall (A) default in making payment of any installment of
Basic Rent five days after such payment shall be due, (B) default in
making payment of any Additional Rent (other than as provided in (vi)
below) which default shall continue for five days after notice from
Lessor of such default, (C) fail to keep in full force and effect the
casualty or general liability insurance coverage required to be
maintained by Lessee pursuant to Article 13, (D) assign this Lease or
any part hereof in violation of the provisions of Article 20 hereof,
or (E) enter into a sublease with respect to this Lease or any part
hereof in violation of the provisions of Article 20; or
(ii) if Lessee shall default in the performance of any covenant, agreement
or obligation on the part of Lessee to be performed under this Lease
other than such covenants that are referred to in clause (i), (vi),
(viii), (xi), (xiii) or (xiv), and such default shall continue for any
specific period expressly provided with respect to such covenant,
agreement or obligation, or if no such specific period is provided,
for a period of 30 days after notice thereof from Lessor; provided,
however, that in the case of a default which can with reasonable
diligence be remedied by Lessee, but not within a period of 30 days,
if Lessee shall promptly commence to remedy the default and thereafter
shall prosecute the remedying of such default with all reasonable
diligence, the period of time after obtaining such notice of default
within which to remedy the default shall be extended for such period
as may be reasonable to remedy the same with all reasonable diligence,
up to a maximum period of 90 days after notice of such default from
Lessor; and provided further, that with respect to any contest by
Lessee pursuant to paragraph (d) of Article 6 hereof, any failure to
comply with the conditions precedent to the right to so contest shall
constitute an immediate Event of Default hereunder; or
(iii) if Lessee, or any corporation succeeding to Lessee by merger,
consolidation or acquisition of all or substantially all of its
assets, shall file a petition in bankruptcy or for reorganization or
for an arrangement pursuant to the Bankruptcy Act, or shall be
adjudicated a bankrupt or become insolvent or shall make an Assignment
for the benefit of its creditors, or shall admit in writing its
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inability to pay its debts generally as they become due, or shall be
dissolved, or shall suspend payment of its obligations, or shall take
any corporate action in furtherance of any of the foregoing; or
(iv) if a petition or answer shall be filed proposing the adjudication of
Lessee or any corporation succeeding to Lessee by merger,
consolidation or acquisition of all or substantially all of its assets
as a bankrupt or its reorganization pursuant to the Bankruptcy Act,
and (A) Lessee or its successor corporation shall consent to the
filing thereof, or (B) such petition or answer shall not be discharged
or denied within 90 days after the filing thereof; or
(v) if a receiver, trustee or liquidator (or other similar official) shall
be appointed for or take possession or charge of Lessee or any
corporation succeeding to Lessee by merger, consolidation or
acquisition of all or substantially all of its assets, or of all or
substantially all of the business or assets of Lessee or its successor
corporation or of Lessee's or its successor corporation's estate or
interest in the Leased Property, and shall not be discharged within 90
days thereafter, or if Lessee or its successor corporation shall
consent to or acquiesce in such appointment; or
(vi) if Lessee shall fail to pay any Adjustment Price, Termination Value,
Purchase Price or Maximum Lessee Risk Amount payable to Lessor as
required by this Lease; or
(vii) if the Leased Property shall have been left unattended, unsecured and
without maintenance in accordance with Article 10 hereof for a period
of 30 days; or
(viii) if, as of the time when the same shall have been made, any
representation or warranty of Lessee set forth herein or in any
consent, notice, certificate, demand, request or other instrument
delivered by or on behalf of Lessee in connection with or pursuant to
this Lease shall prove to have been incorrect or misleading in any
material respect when made; or
(ix) if a final judgment for the payment of money in excess of $2,500,000
(net of insurance proceeds received) shall be rendered against Lessee
and Lessee shall not comply with such judgment, or discharge the same
or cause it to be discharged within 60 days from the entry thereof (or
until the expiration of the period in which an appeal may be filed if
such period should be longer), or shall not appeal therefrom or from
the order, decree or process upon which or pursuant to which said
judgment was granted, based or entered, and secure a stay of execution
pending such appeal; or
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(x) if Lessee has defaulted under any contract or agreement for borrowed
money or under any Capital Leases, including but not limited to any
existing agreement with Beneficiary or its successors or assigns; or
(xi) if Lessee shall fail to purchase the Leased Property in accordance
with Article 17(a) and pay the Termination Value therefor and other
amounts required to be paid pursuant to paragraph (c) of Article 17 in
accordance with Article 16 hereof, if and when required to do so
thereunder; or
(xii) if any Event of Default (as defined therein) shall have occurred and
be continuing under the Agency Agreement;
(xiii) if Lessee shall fail to surrender the Leased Property as and when
required and in the condition required in accordance with Article 26;
or
(xiv) the Work shall not have been Substantially Completed by the
Completion Date.
(b) This Lease and the term and estate hereby granted are subject to the
limitation that whenever an Event of Default shall have occurred and be
continuing, Lessor may, at Lessor's option, elect to (i) lawfully re-enter the
Leased Property, without notice except as otherwise provided by applicable law,
and remove all Persons and property therefrom, either by summary proceedings or
by any other suitable action or proceeding at law, or by other lawful means,
without being liable to indictment, prosecution or damages therefor, and may
have, hold and enjoy the Leased Property, together with the appurtenances
thereto and the improvements thereon; and/or (ii) terminate this Lease at any
time by giving notice in writing to Lessee, electing to terminate this Lease and
specifying the date of termination, and the Term of this Lease shall expire by
limitation at midnight on the date specified in such notice as fully and
completely as if said date were the date herein originally fixed for the
expiration of the Term hereby granted, and Lessee shall thereupon quit and
peacefully surrender the Leased Property to Lessor in accordance with the
provisions of Article 26 hereof, without any payment therefor by Lessor, and
upon the date following the date specified in such notice, or at any time
thereafter, Lessor may re-enter the Leased Property as provided in the preceding
clause (i).
(c) In case of any such re-entry, termination and/or dispossession by
summary proceedings or otherwise as provided in the immediately preceding
paragraph, (i) the Basic Rent and Additional Rent shall become due thereupon and
be paid up to the time of such re-entry, dispossession and/or expiration,
together with such expenses, including reasonable attorneys' fees, as Lessor
shall incur in connection with such re-entry, termination and/or dispossession
by summary proceedings or otherwise; and (ii) Lessor may in good faith relet the
Leased Property or any part or parts thereof (but shall be under no obligation
to do so), either in the name of Lessor or otherwise, for a term or terms which
may, at Lessor's option, be equal to or less than or exceed
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the period which would otherwise have constituted the balance of the Term; and
(iii) Lessee shall also pay to Lessor the amount by which the Basic Rent
provided for in this Lease exceeds the net amount, if any, of the rents
collected on account of the leases of the Leased Property for each quarterly
portion of the period which would otherwise have constituted the Term, which
amounts shall be paid in quarterly installments by Lessee on the respective
Payment Dates specified therefor, and any suit brought to collect said amounts
for any quarterly period shall not prejudice in any way the rights of Lessor to
collect the deficiency in any subsequent quarterly period by a similar action or
proceeding; and (iv) Lessee shall also pay to Lessor all other damages and
expenses which Lessor shall reasonably have sustained by reason of the breach of
any provision of this Lease, including without limitation reasonable attorneys'
fees and expenses, brokerage commissions and expenses incurred in altering,
repairing and putting the Leased Property and any buildings and improvements
thereon in good order and condition and in preparing the same for reletting,
which expenses shall be paid by Lessee as they are incurred by Lessor; or (v) at
the option of Lessor exercised at any time, Lessor forthwith shall be entitled
to recover upon demand from Lessee as liquidated damages, in addition to any
other proper claims but in lieu of and not in addition to any amount which would
thereafter have become payable under the preceding clause (iii) and less any
amounts theretofore collected under the preceding clause (ii) and applied
against repayment of the Equity Investment, the Termination Value as set forth
in Schedule C hereto for the date on which Lessor demands such payment, payable
as of the date of such demand by Lessee under this Lease, whereupon Lessor shall
transfer and convey to Lessee all of Lessor's right, title and interest in and
to the Leased Property pursuant to the terms of Article 16. In the event of
Lessor's acting under the foregoing clauses (i), (ii), (iii) or (iv), Lessor, at
Lessor's option, may make such alterations, repairs or decorations to the
existing Improvements on the Leased Property for uses similar to those
originally intended, as Lessor, in Lessor's reasonable judgment, considers
advisable and necessary for the purpose of reletting the Leased Property; and
the making of such alterations or decorations shall not operate or be construed
to release Lessee from liability hereunder as aforesaid. Any amounts received by
Lessor pursuant to the exercise of Lessor's remedies shall be applied to
Lessee's obligations hereunder and credited against any amounts payable by
Lessee under this Lease.
(d) No receipt of moneys by Lessor from Lessee after a termination of this
Lease by Lessor shall reinstate, continue or extend the Term of this Lease or
affect any notice theretofore given to Lessee, or operate as a waiver of the
right of Lessor to enforce the payment of Basic Rent and Additional Rent, and
any Purchase Price, Termination Value or related amounts to be paid by Lessee to
Lessor for the purchase of the Leased Property then due or thereafter falling
due, it being agreed that after the commencement of suit for possession of the
Leased Property, or after final order or judgment for the possession of the
Leased Property, Lessor may demand, receive and collect any moneys due or
thereafter falling due without in any manner affecting such suit, order or
judgment, all such moneys collected being deemed payments on account of the use
and occupation of the Leased Property or, at the election of Lessor, on account
of
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Lessee's liability hereunder. Lessee hereby waives any and all rights of
redemption provided by any law, statute or ordinance now in effect or which may
hereafter be enacted.
(e) The word "re-enter", as used in this Lease, is not and shall not be
restricted to its technical legal meaning, but is used in the broadest sense
under applicable law. No such taking of possession of the Leased Property by
Lessor shall constitute an election to terminate the Term of this Lease unless
notice of such intention be given to Lessee or unless such termination be
decreed by a court having jurisdiction.
(f) If an action shall be brought for the enforcement of any provision of
this Lease, Lessee shall pay to Lessor all reasonable out-of-pocket costs and
expenses which may become payable as a result thereof, including reasonable
attorneys' fees and expenses.
(g) No right or remedy herein (other than respect to the payment of
liquidated damages) conferred upon or reserved to Lessor is intended to be
exclusive of any other right or remedy, and every right and remedy shall be
cumulative and in addition to any other legal or equitable right or remedy given
hereunder, or at any time existing. The failure of Lessor to insist upon the
strict performance of any provision or to exercise any option, right, power or
remedy contained in this Lease shall not be construed as a waiver or a
relinquishment thereof for the future. Receipt by Lessor of any Basic Rent or
Additional Rent or any other sum payable hereunder with knowledge of the breach
of any provision contained in this Lease shall not constitute a waiver of such
breach, and no waiver by Lessor of any provision of this Lease shall be deemed
to have been made unless made under signature of an authorized officer of
Lessor.
(h) Notwithstanding anything to the contrary contained in this Lease, not
later than 30 days after the occurrence and during the continuance of an Event
of Default (other than an Event of Default pursuant to clauses (iii), (iv) or
(v) of Article 22(a)), Lessee shall have the right to pay to Lessor in
immediately available federal funds an amount equal to the Purchase Price and
upon such payment the Leased Property shall be reconveyed to Lessee or its
designee in accordance with the provisions of Article 16 hereof.
23. NOTICES. All notifications, notices, demands, requests and other
communications herein provided for or made pursuant hereto shall be in writing
and shall sent by (i) registered or certified mail, return receipt requested,
and the giving of such communication shall be deemed complete upon receipt or,
if delivery is refused up on attempted delivery, or (ii) reputable overnight
delivery service, and the giving of such communication shall be deemed complete
upon receipt.
(a) if to Lessor, addressed to such party at Xxx Xxxxxxx Xxxxxx, Xxxxxx,
XX 00000, Attention: Xxxx X. Xxxxxxx with a copy to Day, Xxxxx &
Xxxxxx LLP, 000 Xxxxxxxx Xxxxxx, Xxxxxx, XX 00000, Attention: Xxxx X.
Xxxxxx, Esq. or at such
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other address in the continental United States as Lessor may furnish
to Lessee in writing, or
(b) if to Lessee, addressed to such party at Nine Xxxxxx Xxxxxx, Xxxxxxx,
XX 00000, attention: Xxxx Xxxxxxx and Xxxxxxxxx Xxxxxxx, with a copy
to Xxxxxx & Dodge, Xxx Xxxxxx Xxxxxx, Xxxxxx, XX 00000, attention:
Xxxxxxx Xxxxxx, Esq., or at such other addresses in the continental
United States as Lessee may furnish to Lessor in writing.
24. ESTOPPEL CERTIFICATES. Lessor and Lessee each agree that at any time
and from time to time during the Term of this Lease, it will promptly, but in no
event later than 21 days after request by the other party hereto, execute,
acknowledge and deliver to such other party or to any prospective purchaser or
assignee designated by such other party, a certificate stating, to the best of
such party's knowledge, (a) that this Lease is unmodified and in full force and
effect (or if there have been modifications, that this Lease is in full force
and effect as modified, and setting forth any modifications); (b) the date to
which Basic Rent, Additional Rent and other sums payable hereunder have been
paid; (c) whether or not there is an existing Default by Lessee in the payment
of Basic Rent or any other sum of money due or required to be paid hereunder,
and whether or not there is any other existing Default by Lessee with respect to
which a notice of Default has been served or of which the signer has Actual
Knowledge, and, if there is any such Default, specifying the nature and extent
thereof; (d) whether or not there are any setoffs, defenses or counterclaims
against enforcement of the obligations to be performed hereunder existing in
favor of the party executing such certificate; and (e) stating that Lessee is in
possession of the Leased Property or setting forth the parties in possession and
identifying the instruments pursuant to which they took possession.
25. NO MERGER. Acknowledging that Lessor would not advance funds
without this Lease, Lessee agrees that there shall be no merger of this Lease or
of any sublease under this Lease or of any leasehold or subleasehold estate
hereby or thereby created with the fee or any other estate or ownership interest
in the Leased Property or any part thereof by reason of the fact that the same
person, firm, corporation or other entity may acquire or own or hold, directly
or indirectly, (a) this Lease or any sublease or any leasehold or subleasehold
estate created hereby or thereby or any interest in this Lease or any such
sublease or in any such leasehold or subleasehold estate and (b) (i) the fee
estate or other estate or ownership interest in the Leased Property or any part
thereof or (ii) the Beneficial Interest, and this Lease shall not be terminated
for any cause except as expressly provided herein and any instrument of transfer
shall so provide.
26. SURRENDER AND RETURN.
(a) Upon the expiration or earlier termination of the Term, and provided
that Lessee, if so entitled, has not purchased the Leased Property pursuant to
Article 9, Article 12(c), Article
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17, Article 22(c) or (h) or Article 28, Lessee shall peaceably leave and
surrender and return the Leased Property to Lessor in the condition required
upon completion of the Work, except as completed, repaired, rebuilt, restored,
altered or added to as required by or permitted by any provision of this Lease
(ordinary wear and tear and casualty and condemnation in the case of Article
12(c) excepted). Lessee shall remove from the Leased Property on or prior to
such expiration or earlier termination all property which is not the property of
Lessor, and the Leased Property shall be broom clean and Lessee shall repair any
damage caused by such removal. Property not so removed shall become the property
of Lessor, and Lessor may cause such property to be removed from the Leased
Property and disposed of, and Lessee shall pay the reasonable cost of any such
removal and disposition and of repairing any damage caused by such removal.
(b) Except for surrender upon the expiration or earlier termination of the
Term, no surrender to Lessor of this Lease or of the Leased Property shall be
valid or effective unless agreed to and accepted in writing by Lessor.
(c) Without limiting the generality of the foregoing, upon the surrender
and return of the Leased Property to Lessor pursuant to this Article 26, (i) the
Work, including any punchlist items, shall be complete in all respects and a
final Certificate of Occupancy issued, (ii) the appraisal delivered pursuant to
Section 5.1.16 of the Agency Agreement and any "bringdown" thereof shall have
been satisfactory to Lessor, and (iii) the Leased Property shall (A) be capable
of being immediately utilized by a third-party purchaser or third-party lessee
without further inspection, repair, replacement, alterations or improvements,
licenses, permits, or approvals, except for any of the foregoing required solely
by virtue of the change in ownership (other than to Lessor), use or occupancy of
the Leased Property, and shall be free of any conditions that would interfere
with such a purchaser's or lessee's use and enjoyment of the Leased Property in
accordance with Legal Requirements and Environmental Laws, (B) be in accordance
and compliance with all Legal Requirements and Environmental Laws including,
without limitation, any of the foregoing required by virtue of a change in
ownership, use or occupancy of the Leased Property, (C) be free and clear of any
charge, lien, security interest or encumbrance except for Permitted
Encumbrances, any liens for taxes, assessments and other governmental charges,
which are not then due and payable and which are not allocable to the period
before the date of termination or expiration of this Lease, and Lessor Liens and
any other liens or encumbrances arising solely from any acts or omissions of
Lessor or anyone claiming by, through or under Lessor, without the consent of
Lessee.
(d) On or prior to the date of such surrender and return of the Leased
Property, Lessor shall have received from Lessee, at Lessee's expense, evidence
satisfactory to Lessor of compliance with the provisions of this Article 26,
including without limitation, a "Phase I" or then comparable environmental
assessment for the Leased Property addressed and in form and substance
satisfactory to Lessor, accompanied by a letter permitting Lessor to rely
thereon,
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performed by an independent, licensed professional engineer reasonably
satisfactory to Lessor, and which assessment (y) shall be sufficient in scope to
determine compliance with the then applicable Environmental Laws, and (z) shall
reveal no actual or potential environmental liabilities which have not been
remediated by Lessee in compliance with all Environmental Laws and to the
reasonable satisfaction of Lessor, and, if such environmental assessment reveals
the need for additional review, Lessee shall have provided such additional
information or environmental assessments as are required by Lessor, and any
remediation recommended therein to be performed shall have been performed in
compliance with all Environmental Laws and to the reasonable satisfaction of
Lessor, and evidence of compliance with Article 26(c)(ii) shall have been
provided.
(e) Lessee acknowledges and agrees that a breach of any of the provisions
of this Article 26 may result in damages to Lessor that are difficult or
impossible to ascertain and that may not be compensable at law. Accordingly,
upon application to any court of equity having jurisdiction over the Leased
Property, Lessor shall be entitled to a decree against Lessee requiring specific
performance of the covenants of Lessee set forth in this Article 26.
(f) Upon the request of Lessor, Lessee shall continue to maintain its
insurance policies for the Leased Property, to the extent permitted by such
policies, but subject to Section 13 (g) hereof.
27. SEPARABILITY. Each covenant of Lessee contained in this Lease shall be
separate and independent. The breach of any provision of this Lease by Lessor
shall not discharge or relieve Lessee from its obligation to perform each
obligation of this Lease to be performed by Lessee. If any provision of this
Lease or the application thereof to any Person or circumstance shall to any
extent be invalid and unenforceable, the remainder of this Lease, or the
application of such provision to persons or circumstances other than those as to
which it is invalid or unenforceable, or the enforceability thereof in any
jurisdiction in which such provision shall be valid, shall not be affected
thereby, and each provision of this Lease shall be valid and shall be
enforceable to the extent permitted by law.
28. LESSEE'S END OF TERM PURCHASE OPTION.
(a) If (i) no Default or Event of Default shall have occurred and be
continuing under clause (iii), (iv) or (v) of Article 22, and (ii) this Lease
shall not have been earlier terminated pursuant to its terms, Lessee shall be
entitled, upon written notice to Lessor as hereinafter provided, to purchase the
Leased Property on the last day of the Basic Term, or on the first Basic Rent
Payment Date subsequent to the delivery of a Non-Completion Termination Notice,
for an amount, payable in immediately available federal funds, equal to the
Purchase Price applicable to the date of such purchase. If Lessee intends to
exercise its purchase option granted hereunder, it shall give written notice to
Lessor to such effect (x) in the Termination Notice in accordance
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with the provisions of Article 2 hereof or (y) in the Non-Completion Termination
Notice in accordance with the provisions of Article 17 hereof; provided,
however, if Lessee shall fail to timely deliver such Termination Notice or
Non-Completion Termination Notice as the case may be, Lessee shall be deemed to
have elected to exercise such purchase option. If Lessee gives (or is deemed to
have given) such written notice to Lessor, the same shall constitute a binding
obligation of Lessee to purchase the Leased Property and to pay Lessor the
Purchase Price on the Mandatory Sale Date (as defined below). Any purchase by
Lessee pursuant to this Article 28(a) shall be consummated in accordance with
the terms of Article 16 hereof. If Lessee fails to purchase the Leased Property
on any Mandatory Sale Date in accordance with the terms of this Lease, such
failure shall immediately constitute an Event of Default hereunder.
(b) If Lessee has not exercised (or been deemed to have exercised) its
option to purchase the Leased Property pursuant to Article 2 hereof, Article 17
hereof, or paragraph (a) of this Article 28 (x) so long as no Default or Event
of Default shall have occurred and be continuing Lessee may exercise its option
to terminate this Lease pursuant to Article 2 hereof by delivery of a
Termination Notice or (y) so long as no Default or Event of Default shall have
occurred and be continuing under clause (iii), (iv) or (v) of Article 22 or
under clause (ii) of Article 22 arising out of Lessee's default in the
performance of any covenant, agreement or obligation on the part of Lessee to be
performed under Article 9 of this Lease Lessee may exercise its option to
terminate this Lease pursuant to Article 17 hereof by delivery of a
Non-Completion Termination Notice, specifying Lessee's election to terminate
this Lease, and Lessor shall have the right, and Lessee shall have the
obligation, as agent for Lessor (during the last 360 days of the Basic Term in
the event of a Termination Notice or during the 120 days following the delivery
of the Non-Completion Termination Notice (each a Remarketing Period)), to use
best efforts to obtain bona fide bids (the payment of the purchase price
thereunder shall not be subject to any financing contingency) for the Leased
Property from prospective purchasers who are financially capable of purchasing
the Leased Property in accordance with the terms of this Lease. Upon the request
of Lessor and at Lessee's sole cost and expense, Lessee shall provide Lessor
with a written report describing in reasonable detail Lessee's efforts during
the Remarketing Period to obtain bona fide bids for the purchase of the Leased
Property, including, without limitation, a list of all brokers retained and
Persons approached for the purpose of soliciting bids to purchase the Leased
Property. All bids received by Lessor or Lessee prior to the end of the
Remarketing Period shall be certified by Lessor or Lessee, as the case may be,
in writing, stating the name and address of the bidder and the amount of such
bid.
Not later than the Term Termination Date in the event of a Termination
Notice or 140 days after the Completion Date in the event of a Non-Completion
Termination Notice (each a Mandatory Sale Date), Lessor agrees to sell the
Leased Property to the bidder submitting the highest bid, in accordance with the
terms of Article 16 of this Lease, with such changes as are necessary to reflect
that the sale was to a third party and not Lessee; PROVIDED, HOWEVER, that (x)
any such sale to a third party shall be consummated, and the sales price for the
Leased Property
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shall be paid to Lessor in immediately available funds, at Lessor's address
hereinabove stated or at any other place in the continental United States which
Lessor may designate, on or before the Mandatory Sale Date; and (y) Lessor shall
not be obligated to consummate any proposed sale of the Leased Property if (I)
the aggregate Net Proceeds from the sale of the Leased Property would be less
than the Maximum Lessor Risk Amount as of the applicable Term Termination Date,
or (II) if Lessor has not received the amounts, if any, payable by Lessee
pursuant to paragraph (a) of Article 30 and, if applicable, paragraph (c) of
Article 30. After any such sale with respect to the Leased Property, the
provisions of paragraphs (a) and (c) of Article 30 shall apply. At the time of
any sale of the Leased Property to a third party as contemplated by this
paragraph(b), Lessee shall deliver an Officer's Certificate setting forth the
Net Proceeds from the sale and a detailed calculation thereof.
29. SIGNS; SHOWING. If Lessee has not given (or been deemed to have given)
timely notice pursuant to paragraph (a) of Article 28 of its intention to
purchase the Leased Property on the Term Termination Date, during the
Remarketing Period, Lessor may, subject to all applicable governmental laws,
restrictive covenants, rules and regulations and without unreasonably
interfering with Lessee's business operations, (a) place signs in, on and around
the Leased Property advertising that the same will be available for rent or
purchase, and (b) upon not less than 24 hours notice to Lessee, show the Leased
Property to prospective lessees or purchasers at such reasonable times during
normal business hours as Lessor may elect at all times accompanied by a
representative of Lessee. Lessee will be responsible for hiring one or more
brokers, whose services shall be compensated on a commission basis, and making
the Leased Property available for inspection by prospective purchasers. Lessee
shall promptly upon 24 hours notice permit inspection of the Leased Property and
any maintenance records relating to the Leased Property by the Lessor at all
times accompanied by a representative of Lessee, and any potential purchasers,
during normal business hours, and shall otherwise do all things necessary to
sell and deliver possession of the Leased Property to any purchaser. All such
marketing fees, commissions, costs and expenses of the Leased Property shall be
included among the deductions set forth in clause (ii) of the definition of Net
Proceeds.
30. END OF TERM ADJUSTMENT. (a) The provisions of this paragraph (a) shall
apply only if a sale of the Leased Property to a third party pursuant to
paragraph (b) of Article 28 has been consummated on or before the applicable
Mandatory Sale Date. If the Net Proceeds following a sale of the Leased Property
sold in accordance with paragraph (b) of Article 28 hereof are less than the
Purchase Price for the Leased Property on the applicable Mandatory Sale Date as
set forth in paragraph (a) of Article 28 hereof, Lessee shall, on such Mandatory
Sale Date, pay to Lessor, as an adjustment to the Basic Rent payable under this
Lease, by wire transfer of immediately available federal funds, an amount equal
to such deficiency (the Adjustment Price); PROVIDED, HOWEVER, that if all of the
Limited Lessee Risk Conditions (as hereinafter defined) have been satisfied, the
amount of the Adjustment Price payable by Lessee shall not exceed the sum of (i)
then applicable Maximum Lessee Risk Amount plus (ii) all accrued and
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unpaid Basic Rent (other than Basic Rent capitalized during the Construction
Term) and Additional Rent payable hereunder. Otherwise, if any Limited Lessee
Risk Condition is not met, Lessee shall make the payments specified under
Article 30(b)(ii). If the Net Proceeds following such a sale pursuant to
paragraph (b) of Article 28 on or before the Mandatory Sale Date exceed the
Purchase Price for the Leased Property and Lessor shall have received such
amount, then Lessor shall, on the Mandatory Sale Date, pay to Lessee by wire
transfer of immediately available federal funds, an amount equal to such excess,
as an adjustment to the Basic Rent payable under this Lease; provided, however,
that Lessor shall have the right to offset against such adjustment payable by
Lessor, any amounts then due and payable from Lessee to Lessor hereunder.
(b) If this Lease expires or terminates on a Mandatory Sale Date and a
sale of the Leased Property to Lessee pursuant to paragraph (a) of Article 28 or
to a third party pursuant to paragraph (b) of Article 28 has not been
consummated on or before the applicable Term Termination Date for any reason,
then Lessee shall, on the applicable Mandatory Sale Date, pay to Lessor by wire
transfer of immediately available funds, an amount equal to (i) the Maximum
Lessee Risk Amount, if all of the Limited Lessee Risk Conditions have been met
as of such Term Termination Date, or (ii) the Termination Value, if one or more
of the Limited Lessee Risk Conditions have not been met as of such Term
Termination Date, plus, in the case of the preceding clause (i), the Basic Rent
(but not the Additional Installment of Basic Rent) due and payable on the Term
Termination Date, plus all Additional Rent then due and owing for the Leased
Property. Lessee shall promptly vacate the Leased Property and surrender it to
Lessor on the Mandatory Sale Date in accordance with the provisions of this
Lease, including Article 26. Notwithstanding the termination of this Lease with
respect to the Leased Property, Lessee shall remain liable for the payment of
all applicable sales, excise and other taxes imposed as a result of the sale of
the Leased Property, other than Excluded Taxes. This obligation shall survive
the termination of this Lease with respect to the Leased Property, and upon the
consummation of the sale of the Leased Property at any time after the Mandatory
Sale Date, Lessee shall pay on demand, or reimburse Lessor on demand for the
payment of, all such sales, excise and other taxes. In the event of any such
sale of the Leased Property at any time after the Mandatory Sale Date with
respect thereto, Lessor shall retain the full proceeds of such sale.
(c) The provisions of Articles 28 and 30 are of the essence of this Lease,
and time is of the essence for payment and performance of the obligations of
Lessee set forth therein.
31. CERTAIN DEFINITIONS. As used in this Lease the following terms have
the meanings set forth below:
ACQUISITION AGREEMENT means the Acquisition Agreement dated the date hereof
between Lessor and Lessee.
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ACTUAL KNOWLEDGE by Lessee with respect to the occurrence or non-occurrence
of an event, means knowledge of such occurrence or non-occurrence by the officer
or officers of Lessee in the best organizational position to have such
knowledge.
ADDITION is defined in Article 10.
ADDITIONAL COSTS has the meaning set forth in Article 33(e).
ADDITIONAL INSTALLMENT OF BASIC RENT has the meaning set forth in paragraph
2 of Schedule B.
ADDITIONAL RENT has the meaning set forth in paragraph (b) of Article 3.
ADJUSTMENT PRICE is defined in paragraph (a) of Article 30.
ADVANCE is defined in the Agency Agreement.
AFFILIATE means, with respect to any Person, a Person who, directly or
indirectly, through one or more intermediaries, controls, or is controlled by or
is under common control with, such Person. The term "control" means the
possession, directly or indirectly, of the power to direct or cause the
direction of the management and policies of a Person, whether through the
ownership of voting securities, by contract or otherwise.
AGENCY AGREEMENT means the Agency Agreement, dated as of the date hereof
between Lessor and Lessee, as amended or supplemented from time to time.
ALTERNATE BASE RATE means the Prime Rate.
APPLICABLE OFFICER means the Treasurer, any Assistant Treasurer, Chief
Executive Officer or Chief Financial Officer of Lessee or if Lessee no longer
has an officer with such title, the Chairman of the Board of Directors.
APPRAISAL means an appraisal performed by an MAI appraiser reasonably
satisfactory to Lessor and Lessee using appraisal methodology reasonably
satisfactory to Lessor and Lessee.
APPROVED PLANS is defined in the Agency Agreement.
BANK means Lessor in its individual capacity.
BANKRUPTCY ACT means Title 11 of the United States Code or any other
Federal or state bankruptcy, insolvency or similar law, now or hereafter in
effect in the United States.
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BASIC RENT is defined in paragraph (a) of Article 3.
BASIC TERM is defined in Article 2.
BASIC TERM COMMENCEMENT DATE is defined in Article 2.
BENEFICIAL INTEREST means the beneficial interest of Beneficiary in Lessor
under the Owner Trust Agreement.
BENEFICIARY means the Beneficiary under the Owner Trust Agreement and its
successors and assigns as holders of the Beneficial Interest.
BREAKAGE COSTS has the meaning set forth in Article 33.
BUSINESS DAY means any day other than a Saturday, Sunday or other day or
which banks are authorized to be closed in Massachusetts.
CAPITALIZED LEASE means, as applied to any Person, any lease of property by
such Person as lessee which would be capitalized on a balance sheet of such
Person prepared in accordance with GAAP.
CAPITALIZED LEASE OBLIGATIONS means the capitalized amount of all
obligations under Capitalized Leases.
COMPLETION DATE is defined in the Agency Agreement.
CONSTRUCTION TERM has the meaning set forth in paragraph (a) of Article 2.
CONSTRUCTION TERM COMMENCEMENT DATE means October 21, 1998.
COST OF THE PROJECT is defined in the Agency Agreement.
DEED is defined in the Agency Agreement.
DEFAULT means any event or circumstance which with the passing of time or
giving of notice or both would constitute an Event of Default hereunder.
DEPOSITARY is defined in paragraph (b) of Article 12.
DISPUTE NOTICE is defined in Article 12(b)(ii).
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ENVIRONMENTAL LAWS means and includes but shall not be limited to the
Resource Conservation and Recovery Act (42 U.S.C. ss.6901 ET SEQ.), as amended
by the Hazardous and Solid Waste Amendments of 1984, the Comprehensive
Environmental Response, Compensation and Liability Act (42 U.S.C. ss.9601 ET
SEQ.), as amended by the Superfund Amendments and Reauthorization Act of 1986,
the Hazardous Materials Transportation Act (49 U.S.C. ss.1801 et SEQ.), the
Toxic Substances Control Act (15 U.S.C. ss.2601 ET SEQ.), Clean Air Act (42
U.S.C. ss.7401 ET SEQ.), the Clean Water Act (33 U.S.C. ss.1251 ET SEQ.) the
Federal Insecticide, Fungicide and Rodenticide Act (7 U.S.C. ss.136 ET SEQ.),
the Occupational Safety and Health Act (29 U.S.C. ss.651 ET SEQ.) and all
applicable federal, state and local laws relating to the environment, land use,
protection of national resources, regulation or control of hazardous substances
or environmental health and safety, including obligations under the common law,
ordinances, rules, regulations, permits, approvals, orders, decrees, consent
orders, as any of the foregoing may have been or may be from time to time
amended, supplemented or supplanted, and any other federal, state or local laws,
including obligations under the common law, ordinances, rules, regulations, now
or hereafter existing relating to the environment, land use, protection of
natural resources, regulation or control of Hazardous Substances or
environmental health and safety.
ENVIRONMENTAL REPORTS means the environmental site assessment reports of
the Leased Property delivered pursuant to this Lease and the Agency Agreement.
EQUITY INVESTMENT is defined in the Agency Agreement.
EQUITY RETURN is defined in Schedule B hereto.
EVENT OF DEFAULT is defined in paragraph (a) of Article 22.
EXCLUDED TAXES is defined in paragraph (a) of Article 6.
FISCAL QUARTER means any fiscal quarter of Lessee ending on March 31, June
30, September 30 or December 31.
FISCAL YEAR means the fiscal year of Lessee ending on December 31.
FLEET means Fleet National Bank, a national banking association.
GAAP or GENERALLY ACCEPTED ACCOUNTING PRINCIPLES means, as of the date of
any determination with respect thereto, generally accepted accounting principles
as used by the Financial Accounting Standards Board and/or the American
Institute of Certified Public Accountants.
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HAZARDOUS SUBSTANCES means (i) those substances included within the
definitions of or identified as "hazardous substances", "hazardous materials",
"hazardous waste", or "toxic substances" in or pursuant to any and all local,
state or federal laws, including, without limitation, the Comprehensive
Environmental Response Compensation and Liability Act of 1980 (42 U.S.C.
ss.9601 ET SEQ.) (CERCLA), as amended by Superfund Amendments and
Reauthorization Act of 1986 (Pub. L. 99-499, 100 Stat. 1613) (XXXX), the
Resource Conservation and Recovery Act of 1976 (42 U.S.C., ss. 6901 ET SEQ.)
(RCRA), the Occupational Safety and Health Act of 1970 (29 U.S.C. ss. 651 ET
SEQ.) (OSHA), and the Hazardous Materials Transportation Act, 49 U.S.C. ss.1801
ET SEQ., and in the regulations promulgated pursuant to said laws, all as
amended; (ii) those substances listed in the United States Department of
Transportation Table (40 CFR 172.101 and amendments thereto) or by the
Environmental Protection Agency (or any successor agency) as hazardous
substances (40 CFR Part 302 and amendments thereto); (iii) any material, waste
or substance which is or contains (A) petroleum, including crude oil or any
fraction thereof, natural gas, or synthetic gas usable for fuel or any mixture
thereof, (B) asbestos, (C) polychlorinated biphenyls, (D) designated as
"hazardous substance" pursuant to Section 311 of the Clean Water Act, 33 U.S.C.
ss. 1251 ET SEQ., (33 U.S.C. ss. 1321) or listed pursuant to Section 307 of the
Clean Water Act (33 U.S.C. ss. 1317); (E) flammable explosives; (F) radioactive
materials; and (iv) such other substances, materials and wastes which are or
become regulated as hazardous, toxic or "special wastes" under applicable local,
state or federal law, or the United States government, or which are classified
as hazardous, toxic or as "special wastes" under federal, state or local laws or
regulations, including, without limitation, any Environmental Laws.
IMPROVEMENTS is defined in Article 1.
INDEMNIFIED PARTIES is defined in Article 8.
INDEMNIFICATION PERIOD means the period prior to and during the Term of the
Lease, through and including the first of the following to occur: (i) permitted
sale or transfer of the Lessee's entire interest in the Leased Property by
Lessee (other than to any Affiliate or Subsidiary), or (ii) the return and
surrender of the Leased Property in the condition required by Article 26 of this
Lease and the compliance by Lessee with the terms and conditions of said Article
26, or (iii) a consummation of a foreclosure sale of the Leased Property, or
deed in lieu or other similar transfer of the Leased Property, in each case to
any Person (other than any Affiliate or Subsidiary) unless the Lease and Lessee
shall remain in place and unaffected or (iv) the taking of exclusive and actual
possession or control of the Leased Property by any Indemnified Party or its
Affiliates or designees.
LAND PARCEL is defined in Article 1.
LEASED PROPERTY is defined in Article 1.
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LEGAL REQUIREMENTS is defined in Article 6(c).
LESSEE means GelTex Pharmaceuticals, Inc., a Delaware corporation, and its
successors and assigns expressly permitted hereunder.
LESSEE'S LOSS has the meaning set forth in paragraph (a) of Article 12.
LESSOR means, First Security Bank, N.A., a national banking association
organized under the laws of the United States, not in its individual capacity
except as expressly set forth herein, but solely as Trustee under the Owner
Trust Agreement dated as of the date hereof and its successors and assigns.
LESSOR LIEN means any lien on or with respect to the Leased Property which
is not permitted by the terms of this Lease and which results from (i)
nonpayment by Lessor or any member, partner, shareholder or beneficiary of
Lessor or any affiliate of any of the foregoing (the Lessor Parties), of any
tax, assessment or like charge imposed on any Lessor Party, other than any tax,
assessment or like charge the payment of which is Lessee's obligation hereunder;
(ii) claims against or acts and omissions of any Lessor Party arising out of
events or conditions that are not related to the transactions contemplated by
the terms of this Lease or are in violation of any of the obligations of Lessor
under any of the terms of this Lease; (iii) claims against any Lessor Party
arising out of any transfer (whether voluntary or involuntary) by such Lessor
Party of any portion of its interest in the Leased Property or its rights under
this Lease that is neither permitted hereunder nor consented to in writing by
Lessee; (iv) liens arising out of Lessor's insolvency; or (v) any other act of,
claim against or lien created by any Lessor Party, or any Person claiming by,
through or under any Lessor Party, that is neither permitted under the terms of
this Lease nor consented to in writing by Lessee.
LESSOR PARTIES is defined in the definition of Lessor Lien.
LIMITED LESSEE RISK CONDITIONS means, collectively, the following: (i)
there shall have been no condemnation, damage, destruction or taking of
substantially all of the Leased Property and all Additions, if any, are
substantially complete; (ii) no Default or Event of Default shall have occurred
and be continuing hereunder, including, without limitation, any Default in
Lessee's obligation to maintain the Leased Property or comply with Legal
Requirements; (iii) Lessee shall not have exercised its purchase option under
paragraph (a) of Article 28; (iv) either (x) a sale to a third party of the
Leased Property has been consummated and Lessor has received, in immediately
available funds, on the Term Termination Date, the Net Proceeds of sale of the
Leased Property plus payment of the Maximum Lessee Risk Amount and any
Additional Rent then due and owing hereunder with respect to the Leased
Property, or (y) a sale to a third party of the Leased Property has not been so
consummated on the Term Termination Date and Lessee has vacated the Leased
Property and surrendered and returned the Leased Property to Lessor in the
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condition required by Article 26 hereof, and Lessor has received, in immediately
available funds on or before the Term Termination Date, payment of the Maximum
Lessee Risk Amount and any Additional Rent then due and owing hereunder with
respect to the Leased Property; (v) this Lease has not been terminated prior to
the Termination Date; and (vi) the Leased Property is free and clear of all
liens and encumbrances except for liens for taxes for the current year which are
not due and payable and Permitted Encumbrances described in (a), (c) and (e) of
the definition thereof, and any liens for taxes, assessments and other
governmental charges, which are not then due and payable and which are not
allocable to the period before the date of termination or expiration of this
Lease.
MAXIMUM LESSEE RISK AMOUNT means an amount calculated as set forth in
Schedule G.
MAXIMUM LESSOR RISK AMOUNT means an amount calculated as set forth in
Schedule X.
XXXXX'X means Xxxxx'x Investors Service, Inc.
NET AWARD is defined in paragraph (c) of Article 12.
NET PROCEEDS means, upon the sale of the Leased Property to a third party,
the net amount of the proceeds of such sale, after deducting from the gross
proceeds of such sale (i) all sales taxes and other taxes (excluding any
Excluded Taxes), (ii) all fees, costs and expenses of such sale incurred by
Lessor or by Lessee, as Lessor's agent, unless separately paid or reimbursed by
Lessee, and (iii) any other amounts for which, if not paid, Lessor would be
liable or which, if not paid, would constitute a lien on the Leased Property.
OFFICER'S CERTIFICATE means a certificate executed and delivered by the
Applicable Officer of Lessee, or such other officer of Lessee as is in the best
position to know the substance of the matters contained in such certificate.
OPERATIVE DOCUMENTS has the meaning set forth in the Agency Agreement.
OVERDUE RATE means 2% above the Equity Return.
OWNER TRUST AGREEMENT means the Owner Trust Agreement, dated as of the date
hereof between Bank and Beneficiary, as amended and supplemented from time to
time.
PAYMENT DATES is defined in paragraph (a) of Article 3.
PERMITTED ENCUMBRANCES means with respect to the Leased Property:
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(a) rights reserved to or vested in any municipality or public
authority to condemn, appropriate, recapture or designate a
purchaser of the Leased Property;
(b) any liens thereon for taxes, assessments and other governmental
charges and any liens of mechanics, materialmen or laborers for
work or services performed or material furnished in connection
with the Leased Property, which are not yet due and payable, or
the amount or validity of which are being contested as permitted
by Article 6 hereof;
(c) easements, rights of way, servitudes, zoning laws, use
regulations, and other similar reservations, rights and
restrictions and other minor defects and irregularities in the
title to the Leased Property listed in Lessor's title insurance
policy (or commitment therefor) contemplated by Section 5.1.4 of
the Agency Agreement and acceptable to Lessor or granted in
accordance with the provisions of Article 34 hereof;
(d) this Lease;
(e) such other matters as are set forth on Schedule B to Lessor's
title insurance policy (or commitment therefor) contemplated by
Section 5.1.4 of the Agency Agreement, and acceptable to Lessor
and Beneficiary.
PERSON means any individual, sole proprietorship, partnership, joint
venture, trust, unincorporated organization, association, corporation, limited
liability company, institution, public benefit corporation, entity or government
(whether federal, state, county, city, municipal or otherwise, including,
without limitation, any instrumentality, division, agency, body or department
thereof).
PRIME RATE means that rate of interest per annum announced by Fleet from
time to time, as being its prime rate, it being understood that such rate is
merely a reference rate, not necessarily the lowest, which serves as the basis
upon which effective rates of interest are calculated for obligations making
reference thereto.
PROJECT is defined in the Agency Agreement.
PROPERTY means any interest in any kind of property or asset, whether real,
personal or mixed, or tangible or intangible.
PURCHASE PRICE is defined in Schedule F.
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REGULATORY CHANGE means any change after the date of this Agreement in
United States federal, state or foreign laws or regulations (including
Regulation D and the laws or regulations which designate any assessment rate
relating to certificates of deposit or otherwise) or the adoption or making
after such date of any interpretations, directives or requests applying to a
class of banks, including Fleet, of or under any United States federal, state,
or foreign laws or regulations (whether or not having the force of law) by any
court or governmental or monetary authority charged with the interpretation or
administration thereof.
REMARKETING PERIOD is defined in paragraph (b) of Article 28.
SUBSIDIARY means, with respect to any Person, any corporation, partnership
or other business (including business trusts) of which an aggregate of more than
50% of the outstanding stock, having ordinary voting power to elect or appoint a
majority of the members of the board of directors, trustees or members of a
similar governing body of such corporation, partnership or other entity
(irrespective of whether, at the time, stock of any other class or classes of
such corporation, partnership or other entity shall have or might have voting
power by reason of the happening of any contingency), is, or of which an
aggregate of more than 50% of the interests in which are, at the time, directly
or indirectly, owned by such Person and/or one or more Subsidiaries of such
Person.
SUBSTANTIALLY COMPLETE is defined in the Agency Agreement.
SUCCESSOR OWNER means the Owner Trust at any time the trustee thereof shall
be a successor Owner Trustee (as defined in the Owner Trust Agreement).
TAXES is defined in Article 6(a).
TERM means the Construction Term and the Basic Term.
TERM TERMINATION DATE means the last day of the Basic Term.
TERMINATION DATE is defined in paragraph (c) of Article 12.
TERMINATION NOTICE is defined in Article 2.
TERMINATION VALUE is defined in Schedule C.
TRADE FIXTURES is defined in paragraph (a) of Article 11.
WORK is defined in the Agency Agreement.
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32. NATURE OF LESSOR'S OBLIGATIONS; LIMITATIONS ON LIABILITY. Anything in
this Lease to the contrary notwithstanding, except with respect to Lessor Liens,
it is understood and agreed that (irrespective of any breach of any
representation, covenant, agreement or undertaking of any nature whatsoever made
in this Lease), no recourse shall be had under any rule of law, statute or
constitution or by the enforcement of any assessments or penalties or otherwise
for the payment of any sum hereunder or for any other claim hereunder against
(i) Lessor, Bank, Beneficiary or any other holder of the Beneficial Interest, or
any past, present or future Affiliate, partner, officer, director, any owner,
shareholder, agent or employee of or in any thereof or of any partner thereof or
their legal representatives, successors or assigns, (ii) any Successor Owner or
(iii) any Person for whom Lessor, Beneficiary or any other holder of the
Beneficial Interest was acting as an agent for the account and benefit of such
Person in entering into the transactions evidenced by this Lease, and that such
Person was or was alleged to be the principal of Lessor, Beneficiary or any
other holder of the Beneficial Interest. It is expressly understood that by the
execution of this Lease all such liability (a) of Lessor, Beneficiary or any
other holder of the Beneficial Interest or any past, present or future
Affiliate, partner, officer, director, any shareholder, agent or employee
thereof or director or shareholder of any partner thereof or any of their
respective legal representatives, successors or assigns, (b) of any Successor
Owner or (c) of such other Person, is and is being expressly waived and released
as a condition of and as a consideration for the execution of this Lease by
Lessor, that Lessee and its successors and assigns as lessee hereunder agree to
look solely to the Leased Property for the payment of any such sums or
satisfaction of any such other claims.
In addition to and not in limitation of the foregoing, it is understood and
agreed that (i) this Lease is executed and delivered by Bank, not in its
individual capacity but solely as trustee under the Owner Trust Agreement in the
exercise of the power and authority conferred and vested in it as such trustee,
(ii) (except as pertaining to Lessor Liens attributable to Bank in its
individual capacity) each of the representations, undertakings and agreements
made herein by Lessor are not personal representations, undertakings and
agreements of Bank, but are binding only on Lessor, as trustee, and (iii)
actions to be taken by Lessor pursuant to its obligations hereunder may, in
certain instances, be taken by Lessor only upon specific authority of
Beneficiary as provided in the Owner Trust Agreement.
Notwithstanding the foregoing, nothing in this Article 32 shall be
construed to prohibit any action or proceeding against (i) Lessor and Bank with
respect to Lessor Liens (as to Bank, solely with respect to Lessor Liens
attributable to it), (ii) any party hereto for its own fraud, willful misconduct
or grossly negligent conduct, or (iii) in the case of Lessor and Bank with
respect to the receipt and disbursement of funds, their own negligent action or
their own negligent failure to act. The foregoing provisions of this Article 32
shall survive the termination of this Lease and the other Operative Documents.
33. EQUITY INVESTMENT PROVISIONS; ADDITIONAL COSTS.
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(a) Notwithstanding any other provision of this Lease, if the Beneficiary
shall notify the Lessee that any Regulatory Change makes it unlawful, or any
central bank or other governmental authority asserts that it is unlawful, for
Lessor or Beneficiary to perform its obligations hereunder to make any Advance
as an Advance bearing interest at a LIBOR based rate or to fund or maintain
Advances at a LIBOR based rate hereunder (i) the obligation of Beneficiary to
make Advances bearing interest at a LIBOR based rate shall be suspended until
the Beneficiary shall notify the Lessee that the circumstances causing such
suspension no longer exist and (ii) the outstanding amounts owed to Lessor shall
from and after the end of the then-current LIBOR Period (or, if it shall be
unlawful to maintain such advances at a LIBOR based rate during such period,
immediately) bear interest at the Alternate Base Rate.
(b) In the event that on any LIBOR Interest Setting Date, Beneficiary
shall have determined (which determination shall be conclusive and binding upon
Lessee in the absence of clearly demonstrable error) that, by reason of
circumstances affecting the London interbank market or otherwise, adequate and
reasonable means do not exist for ascertaining LIBOR for such LIBOR Period, or
dollar deposits in the principal amounts of the requested Advance or unpaid
amounts to which such LIBOR Period is to be applicable are not generally
available in the London interbank market, with respect to a requested Advance or
the continuation of unpaid amounts beyond the expiration of the then current
LIBOR Period with respect thereto, the Beneficiary shall promptly give telecopy
or telephonic notice of such determination to Lessee (together with a copy of
such certification). If such notice is given, any Advance requested thereafter
shall be made at the Alternate Base Rate and any outstanding amounts shall be
converted, on the last day of the then current LIBOR Period, to the Alternate
Base Rate. Until such notice has been withdrawn by Beneficiary, no further
Advances at a LIBOR based rate shall be made. Any outstanding portion of the
Advances that does not satisfy the conditions set forth in paragraph (a) above
shall bear interest at the Alternate Base Rate.
(c) If Lessee shall be liable for Lessor's Additional Costs pursuant to
paragraph (e) below, with respect to any Advance as to which a LIBOR Rate is
applicable, Lessee may elect by written notice to Beneficiary not less than ten
Business Days prior to the end of the applicable LIBOR Period for such Advance,
to pay interest thereafter on such Advances at the Alternate Base Rate.
(d) If any payment of Equity Return representing the LIBOR Rate is made
other than on the last day of the applicable LIBOR Period, as a result of
prepayment, or for any other reason, the Lessee shall, upon demand by Lessor,
pay to the Beneficiary any amounts required to compensate Beneficiary for any
additional losses, costs or expenses which it may incur as a result of such
payment (Breakage Costs), including, without limitation, any loss, cost or
expense incurred by reason of the liquidation or redeployment of deposits or
other funds acquired by Beneficiary representing the LIBOR Rate.
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(e) Without duplication of Regulatory Changes made from time to time to
the LIBOR Reserve Percentage, in the event that: (i) any Regulatory Change shall
either impose, modify or deem applicable or result in the application of any
reserve, special deposit, capital maintenance, capital ratio or similar
requirement against loan commitments made by Beneficiary (or any of its
respective successors or assignees hereunder) or against any other extensions of
credit (other than direct loans) or commitments to extend credit or other assets
of or any deposits or other liabilities taken or entered into by Beneficiary,
and the result of any event referred to above shall be to increase the actual
cost to Beneficiary of making or maintaining such commitment, or to impose upon
Beneficiary or increase any capital requirement applicable as a result of the
making or maintenance of, such commitment or the obligation of Lessee with
respect to such commitment or to reduce the amounts receivable by Beneficiary
with respect to such commitment (which increase in cost or increase in (or
imposition of) capital requirements or reduction in amounts receivable shall be
determined by Beneficiary's reasonable allocation of the aggregate of such
actual cost increases, capital increases or impositions or reductions in amounts
receivable resulting from such events); or (ii) any Regulatory Change shall: (A)
result in the imposition of any taxes, levies, imposts, deductions, charges or
withholdings by the United States of America or any State or political
subdivision thereof (Taxes) on any amounts receivable by Beneficiary hereunder
or change the basis of taxation of any amounts payable to Lessor under the
Agency Agreement (in either case, other than taxes imposed on the overall net
income of Beneficiary by the United States or any state or any political
subdivision thereof, or any foreign nation or any political subdivision
thereof); or (B) impose or modify any reserve, capital maintenance, capital
ratio, capital adequacy, Federal Deposit Insurance Corporation premium or
assessment, special deposit or similar requirements relating to any extensions
of credit or other assets of, or any deposits with or other liabilities of,
Beneficiary (including the Equity Investment made hereunder); or (C) impose any
other conditions affecting this Lease Agreement in respect of the Equity
Investment made hereunder (or any of such extensions of credit or liabilities);
and the result of any event referred to in clause (A), (B) or (C) above shall be
to increase Beneficiary's actual cost of making or maintaining the Equity
Investment made hereunder or its commitment to make an Equity Investment under
the Agency Agreement or reduce the amounts receivable by Beneficiary under the
Owner Trust Agreement or (iii) Breakage Costs are suffered by Beneficiary (such
increases in actual costs and reductions in amounts receivable pursuant to (i),
(ii) and (iii) are hereinafter referred to as Additional Costs); then, upon
demand made by Beneficiary as promptly as practicable after it obtains knowledge
that such a Regulatory Change exists and determines to make such demand, Lessee
shall pay as Additional Rent hereunder to Lessor from time to time as specified
by Beneficiary, additional fees or other amounts which shall be sufficient to
compensate Beneficiary for such actual increased cost or increase in (or
imposition of) capital requirements or reduction in amounts receivable by
Beneficiary (including, without limitation, Additional Costs) from the date of
such change, together with interest on each such amount from the date demanded
until payment in full
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thereof at the LIBOR Rate or Alternate Base Rate applicable to the Additional
Advance made in the month that payment of such Additional Costs is demanded by
Lessor.
Determinations by Beneficiary for purposes of this Section 33 of the effect
of any Regulatory Change on its actual costs of making or maintaining Equity
Investment of Lessor made hereunder or on amounts received by it in respect
thereof and of the additional amounts required to compensate Beneficiary in
respect of its Additional Costs, shall be conclusive, absent manifest error.
Beneficiary may provide Lessee with evidence of its calculations of actual costs
for which payment is requested hereunder upon Lessee's written request.
34. GRANTING OF EASEMENTS, ETC. If no Event of Default has occurred and is
continuing, Lessor shall from time to time upon the written request of Lessee
(and at Lessee's sole cost and expense), (i) grant easements, licenses, rights
of way and other rights and privileges in the nature of easements for the
purposes of providing utilities and the like to the Leased Property or for
purposes of operating the Leased Property and adjacent properties (such as
office park reciprocal easement agreements and the like), (ii) release existing
easements and appurtenances relating to the provision of utilities and the like
to the Leased Property or for purposes of operating the Leased Property and
adjacent properties (such as office park reciprocal easement agreements and the
like) and (iii) execute and deliver any instrument, in form and substance
reasonably acceptable to Lessor, necessary or appropriate to make or confirm
such grants or releases to any Person, with or without consideration, provided
that such grant or release does not (x) interfere with and is not detrimental to
the conduct of business on the Leased Property, (x) impair the usefulness,
useful life or fair market value of the Leased Property or (z) cause a default
under any other agreement to which Lessee is a party or benefitting the Leased
Property which default would be reasonably likely to have an adverse effect on
the usefulness, useful life or fair market value of the Leased Property and;
provided that Lessee shall have delivered such other instruments, certificates,
surveys, title insurance policy endorsements and opinions of counsel as Lessor
may reasonably request; and provided further that Lessor, shall have the right,
but not the obligation, to obtain an independent Appraisal, at Lessor's expense,
to verify the certification of Lessee as to the effect of the proposed action on
fair market value and if such Appraisal concludes that the proposed action will
impair the fair market value of the Leased Property by 1% or more, Lessee shall
reimburse Lessor for the costs of such Appraisal and Lessor, may withhold its
consent or condition its consent upon payment by Lessee of an amount equal to
such diminution of fair market value; provided, however, that if Lessee
disagrees with such Appraisal Lessee may cause a second Appraisal to be made,
which, if such Appraisal differs materially from such first Appraisal, shall be
subject to a third Appraisal undertaken by the two appraisers who rendered the
first two appraisals. Any such request by Lessee shall be accompanied by an
Officer's Certificate as to compliance with the conditions set forth in the
foregoing clauses (x), (y) and (z).
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35. SUBSTANTIAL COMPLETION; COMPLETION OF "PUNCHLIST" ITEMS. On the date
the same occurs, Lessee shall certify to Lessor that the Work is Substantially
Complete. Any final "punchlist" items (not to exceed 5% of the Cost of the
Project) with respect to the Project shall be delivered to Lessor, and Lessee
shall make reasonable efforts to complete all punch list items and shall obtain
a final certificate of occupancy (if required by applicable law) with respect to
the Project within 60 days after the Project is Substantially Complete and in
any event as soon as possible thereafter, and shall provide Lessor with an
Officer's Certificate as to such completion and a copy of such Certificate of
Occupancy.
36. RECORDING. Lessor and Lessee will execute, acknowledge, deliver and
cause to be recorded or filed at Lessee's expense, in the manner and place
required by law, a notice of this Lease including, without limitation, the terms
of Section 38 hereof.
37. MISCELLANEOUS. This Lease, the Agency Agreement and the Acquisition
Agreement embody the entire agreement between Lessor and Lessee relating to the
subject matter hereof and supersede all prior agreements and understandings
relating to such subject matter. This Lease shall be binding upon and shall
inure to the benefit of and be enforceable by the parties hereto and their
respective successors and assigns permitted hereunder. No term or provision
hereof may be amended, changed, waived, discharged or terminated orally, but
only by an instrument specifically evidencing an intent to amend signed by the
party against whom enforcement thereof is sought. No failure, delay, forbearance
or indulgence on the part of any party in exercising any right, power or
privilege hereunder shall operate as a waiver thereof, or as an acquiescence in
any breach, nor shall any single or partial exercise of any right, power or
remedy hereunder preclude any other or further exercise thereof or the exercise
of any other right, power or privilege. This Lease and the rights and
obligations in respect hereof shall be governed by, and construed and
interpreted in accordance with, the laws of the Commonwealth of Massachusetts.
All headings are for reference only and shall not be considered as part of this
Lease. This Lease may be executed in any number of counterparts, each of which
shall be an original, and such counterparts together shall constitute but one
and the same instrument. Lessee may cause to be performed any obligation of
Lessee under this Lease in lieu of performing such obligation itself.
To the extent that this Lease is characterized as being a financing
arrangement as set forth below in Article 38, Lessor and Lessee hereby
acknowledge and agree as follows: (1) the amount of interest shall be equal to
the difference between (a) the aggregate amount of payments due under this Lease
(the Payments) and (b) the aggregate cost of the Leased Property to Lessor (the
Cost); (2) Lessee has been informed of the Cost or, in the alternative,
acknowledges that it has been given an opportunity to determine the Cost; (3)
the rate of interest agreed to and specified by Lessor and Lessee in such event
shall be that rate per annum that may be calculated based upon the Cost (i.e.
the principal amount) and the Payments (i.e., the principal and interest
payments); and (4) if the rate of interest so calculated is ever deemed to
exceed the maximum
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rate permitted by applicable law, then the Payments shall be automatically
reduced to ensure that such rate of interest does not exceed the maximum rate
permitted by applicable law.
38. OWNERSHIP OF THE LEASED PROPERTY.
(a) Lessor and Lessee intend that (i) for financial accounting purposes
with respect to Lessee, this Lease will be treated as an "operating lease"
pursuant to Statement of Financial Accounting Standards No. 13, as amended, but
(ii) for federal and all state and local income tax purposes, (A) this Lease
will be treated as a financing arrangement, (B) Lessor will be deemed to be a
lender making a loan for the benefit of Lessee, which loan is secured by the
Leased Property, and (C) Lessee will be treated as the owner of all of the
Leased Property and will be entitled to all tax benefits ordinarily available to
an owner of a property similar to the Leased Property for such tax purposes. So
long as no Event of Default shall have occurred, Lessor and Beneficiary shall
take no action inconsistent with such intent for tax purposes, PROVIDED, that
nothing in this Article 38 shall be deemed to restrict Lessor's right to
exercise any remedies after the occurrence of an Event of Default.
(b) Lessee hereby mortgages, warrants, grants and conveys, with MORTGAGE
COVENANTS and POWER OF SALE, to Lessor a lien on and security interest in all of
Lessee's right, title and interest in and to the Leased Property, together with
any substitutions, replacements and additions thereto, all of Lessee's rights in
and to the Approved Plans and all general intangibles related to the Leased
Property and all of Lessee's rights, claims and damages arising from warranties
(whether express or implied) of architects, contractors and subcontractors and
any other vendors with respect to the development and construction of the
Improvements, and all proceeds of the conversion, voluntary or involuntary, of
the foregoing into cash, investments, securities or other property, whether in
the form of cash, investments, securities or other property. Lessee shall, take
such actions and execute, deliver, file and record such other documents,
financing statements, mortgages and deeds of trust as may be necessary to ensure
that, if this Lease were deemed to create a lien on and security interest in the
Leased Property in accordance with this Article 38, such security interest would
be deemed to be a perfected lien on and security interest of first priority
under applicable federal, state and local law, subject only to Permitted
Encumbrances, and will be maintained as such throughout the Term.
(c) Lessor and Lessee intend and agree that with respect to the nature of
the transaction evidenced by this Lease in the context of the exercise of
remedies under the Operative Documents, including, without limitation, in the
case of any insolvency or receivership proceedings or a petition under the
United States bankruptcy laws or any other applicable insolvency laws or statute
of the United States of America or any State or Commonwealth thereof affecting
Lessee or Lessor, or any enforcement or collection actions and for all other
purposes (except as provided in paragraph (a) of this Article 38), the
transactions
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evidenced by this Lease shall be regarded as a loan made by Lessor an unrelated
third party lender to Lessee secured by all of the Leased Property (it being
understood that Lessee hereby mortgages, warrants, grants and conveys a lien on
and security interest in all of the Leased Property to Lessor to secure such
loans).
(d) Lessor and Lessee further intend and agree that, for the purpose of
securing Lessee's obligations for the repayment of the above-described loan from
Lessor to Lessee, (i) this Lease shall also be deemed to be a security agreement
and financing statement within the meaning of Article 9 of the Uniform
Commercial Code and a real property mortgage; (ii) the conveyance provided for
in paragraph (b) of this Article 38 shall be deemed to be a grant by Lessee to
Lessor, of a security interest in all of the Lessee's right, title and interest
in and to the Leased Property, together with any substitutions, replacements and
additions thereto, all of the Lessee's rights in and to the Approved Plans and
all general intangibles related to the Leased Property and all of Lessee's
rights, claims and damages arising from warranties (whether express or implied)
of architects, contractors and subcontractors with respect to the development
and construction of the Improvements, and all proceeds of the conversion,
voluntary or involuntary, of the foregoing into cash, investments, securities or
other property, whether in the form of cash, investments, securities or other
property (it being understood that Lessee hereby mortgages and warrants and
grants a lien on and security interest in all of the Leased Property to Lessor
to secure the Loans described in paragraph (a) above); (iii) the possession by
Lessor or any of its agents of notes and such other items of property as
constitute instruments, money, negotiable documents or chattel paper shall be
deemed to be "possession by the secured party" for purposes of perfecting the
security interest pursuant to Section 9 of the Uniform Commercial Code; and (iv)
notifications to Persons holding such property, and acknowledgments, receipts or
confirmations from financial intermediaries, bankers or agents (as applicable)
of Lessee shall be deemed to have been given for the purpose of perfecting such
security interest under applicable federal, state and local law. Lessor (upon
request) and Lessee shall, to the extent consistent with this Lease, take such
actions and execute, deliver, file and record such other documents, financing
statements, mortgages and deeds of trust as may be necessary to ensure that, if
this Lease were deemed to create a lien on and security interest in the Leased
Property in accordance with this Article 38, such lien and security interest
would be deemed to be a perfected lien on and security interest of first
priority under applicable federal, state and local law, subject only to
Permitted Encumbrances, and will be maintained as such throughout the Term of
this Lease.
64
IN WITNESS WHEREOF, the undersigned have executed this Lease as of the day
and year first above written.
Lessor:
FIRST SECURITY BANK, N.A., not in
its individual capacity except as
expressly set forth herein, but
solely as Trustee under the Owner
Trust Agreement dated as of
October 21, 1998
By: /s/ Xxx X. Xxxxx
------------------------------
Name: Xxx X. Xxxxx
Title: Vice President
Lessee:
GELTEX PHARMACEUTICALS, INC.
By: /s/ Xxxx X. Xxxxxxx, Xx.
------------------------------
Name: Xxxx X. Xxxxxxx, Xx.
Title: Chief Financial Officer
65
SCHEDULE A
Description of the Demised Premises
1. The parcel of land with all buildings and other improvements thereon,
situated on and westerly of Second Avenue in Waltham, Massachusetts, shown
as Lot 15 on a Plan of Land in Waltham, Mass. dated 4 Sept. 1963 by Xxxxxxx
X. Xxxxxxx, Inc., recorded with the Middlesex South District Registry of
Deeds in Book 10409, Page 121, bounded and described as follows:
NORTHEASTERLY on Second Avenue 60.00 feet;
SOUTHEASTERLY on other land of the Grantors shown as
Lot 16 on said Plan 210.32 feet;
NORTHEASTERLY on the same by four lines measuring 40.50 feet,
97.44 feet, 185.90 and 117.88 feet which run along the center of
the 20- foot sewer easement shown on said Plan;
SOUTHERLY on the same 234.69 feet;
EASTERLY on the same 144.06 feet;
SOUTHERLY on other land of the Grantors by three lines measuring
1.83 feet, 425.15 feet and 21.31 feet;
WESTERLY in part on other land of the Grantors, there measuring
349.60 feet and in part on land designated on said Plan as Lot B Plan
1740 of 1957,171.13 feet;
NORTHERLY on land designated on said Plan as Lot 8A 387.04 feet; and
NORTHWESTERLY on other land of the Grantors shown as Lot 17 on said
Plan by two lines measuring 21.03 feet and 204.74 feet.
Containing according to said Plan 300,020 square feet of land.
For title reference, see deed dated November 20, 1963, recorded with the
Middlesex South District Registry of Deeds in Book 10409, Page 121
The right to use for all purposes for which streets are commonly used,
including the installation and maintenance of pipes, conduits and poles,
for sewer, water and all other utilities, (a) the 30-foot strip of land
lying southerly of and adjacent to Lots 15 and 16 on said Plan and
extending to Second Avenue and (b) Second Avenue from the easterly end of
said 30-foot strip to Winter Street in common with all others from time to
time entitled, subject as to said 30-foot strip to the rights of the City
of Waltham under the sewer taking recorded with said Deeds in Book 9772,
Page 071.
2. The parcel of land situated on Second Avenue in Waltham, Middlesex County,
Massachusetts, shown as Lot 24 on a Plan of Xxxx 00 xxx 00, Xxxxxxx,
Xxxxxxxxxxxxx
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dated 3 March 1965, by Xxxxxxx X. Xxxxxxx, Inc., recorded with said Deeds
in Book 10899, Page 121, bounded and described as follows:
Commencing at a point on the westerly line of said Second Avenue at
the Southeast corner of said Lot 24, thence running south 88 degrees 04'07"
west, 117.92 feet to a point; thence north 14 degrees 56'20" west, 117.88
feet to a point; thence north 24 degrees 41'20" west, 185.90 feet to a
point; thence north 37 degrees 45'20" west, 97.44 feet to a point; thence
north 3 degrees 56'40" east, 40.50 feet to a point; thence north 58 degrees
27'11" east, 210.32 feet to a point on the westerly line of Second Avenue;
thence south 31 degrees 32'49" east, 78.76 feet along Second Avenue to a
point; thence along Second Avenue by a curve to the left having a radius of
350 feet and an arc or distance of 178.63 feet; then south 2 degrees 18'20"
east, 270.38 along the westerly line of Second Avenue to the point or place
of beginning, containing according to said Plan 87,070 square feet of land.
For title reference, see deed dated November 20, 1963, recorded with the
Middlesex South District Registry of Deeds in Book 13296, Page 688.
67
SCHEDULE B
BASIC RENT
1. CONSTRUCTION TERM. During the Construction Term, Basic Rent shall
accrue in arrears on December 31, 1998 and on the last day of March, June,
September and December, 1999 or such date as the Basic Term shall begin pursuant
to the terms of Article 2 hereof (each a Payment Date) and shall be capitalized
and become a part of the Equity Investment. Such Basic Rent shall accrue at a
rate per annum equal to the Equity Return on the actual outstanding Equity
Investment calculated on the actual number of days subsequent to the next
preceding Payment Date in respect of the actual amount of Equity Investment
outstanding on such day.
2. BASIC TERM. During the Basic Term, Basic Rent shall be paid in arrears
on January 31, 2000 and on the last day of each April, July, October and January
thereafter to and including October 31, 2005 (each also a Payment Date) at a
rate per annum equal to the Equity Return on the actual outstanding Equity
Investment calculated on the actual number of days subsequent to the next
preceding Payment Date in respect of the actual amount of Equity Investment
outstanding on each such day. A final Additional Installment of Basic Rent shall
be payable on October 31, 2005 equal to an amount equal to 85% of the Equity
Investment outstanding on such day.
3. EQUITY RETURN. Equity Return shall mean a rate of return on the
outstanding Equity Investment at any time equal to the LIBOR Rate unless the
LIBOR Rate shall not be in effect, in which case the Alternative Base Rate shall
be used to determine the Equity Return.
4. RATE PROTECTION. Lessee may request and Fleet may issue caps, collars,
swaps, and other rate protection products, using Fleet's then customary
documentation for such transactions. Such caps, collars, swaps and other rate
protection products will be issued for such fees and upon such other terms and
conditions as may be agreed upon by Fleet and the Lessee at the time of issuance
thereof. Any rate protection products issued shall be cross collateralized with
all other indebtedness of Lessee to Fleet.
5. DEFINITIONS:
ADJUSTED LIBOR means for any LIBOR Period, an interest rate per annum obtained
by dividing (a) LIBOR by (b) a percentage equal to 1.00 minus the LIBOR Reserve
Percentage for such LIBOR Period.
LIBOR means the rate of interest per annum (expressed as an annual rate rounded
to the nearest one-hundredth of a Basis Point) equal to the London interbank
offered rate for deposits in U.S. dollars for a period equal to the applicable
LIBOR Period as of 1:00 p.m. local London time, on the LIBOR Interest Setting
Date for such LIBOR Period. The applicable LIBOR shall be determined by
reference to the Telerate, Inc. display designated as page 3750 -- "British
Bankers Association Interest Settlement Rates" (or such other page as may
replace such page on the
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Telerate, Inc. service for the purpose of displaying London interbank offered
rates); PROVIDED, HOWEVER, that if Telerate, Inc. shall not publish or shall
cease publication of such information, the applicable LIBOR shall be determined
by reference to the highest rate shown on the display designated as page "LIBO"
on the Reuters Monitor Money Rates Service (or such other page as may replace
the LIBO page on that service for the purpose of displaying London interbank
offered rates of major banks); and PROVIDED FURTHER that if Reuters Monitor
Money Rates Service shall not publish or shall cease publication of such
information, the applicable LIBOR shall be determined by reference to the rate
at which deposits in U.S. dollars are offered by the principal office of Fleet
in the London interbank market for the applicable LIBOR Period. The
determination of LIBOR by Lessor shall be conclusive absent manifest error.
LIBOR BANKING DAY means any Business Day on which dealings in U.S. dollar
deposits are conducted by and between banks in the London Interbank Market.
LIBOR INTEREST SETTING DATE means, with respect to any LIBOR Period, the date
which is two LIBOR Banking Days before the first day of such LIBOR Period.
LIBOR LENDING OFFICE means as the principal office of Fleet or other office or
branch of Fleet as it may hereafter designate as its LIBOR Lending Office.
LIBOR PERIOD means, the period commencing on and including the funding date of
such Advance and ending on the last day of such calendar month, and, thereafter
the period commencing on the last day of the immediately preceding LIBOR Period
and having a term co-equal with the term of all prior LIBOR Periods provided
that:
(a) if any LIBOR Period would otherwise end on a day which is not a LIBOR
Banking Day, that LIBOR Period should be extended to the next succeeding LIBOR
Banking Day, unless the result of such extension would be to carry such LIBOR
Period into another calendar month, in which event such LIBOR Period shall end
on the immediately preceding LIBOR Banking Day;
(b) for purposes of calculating the Equity Return for any LIBOR Period,
such calculation shall include the first day, but exclude the last day, of any
such LIBOR Period;
(c) any LIBOR Period that begins on the last LIBOR Banking Day of a
calendar month (or on a day for which there is no numerically corresponding day
in the calendar month at the end of such LIBOR Period) shall end on the last
LIBOR Banking Day of the calendar month at the end of such LIBOR Period; and
(d) each LIBOR Period shall be for a 30, 60, 90, 120 or 180 day period
(except for LIBOR Periods beginning on a funding date).
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LIBOR PREPAYMENT. If, due to the purchase of the Leased Property, Termination of
this Lease, or for any other reason, Lessor receives any repayment of any Equity
Investment on any date other than the last day of a LIBOR Period, Lessee shall
upon the written demand of Lessor pay forthwith to Lessor all amounts required
to compensate Lessor for losses, costs or expenses which it may have incurred
and may reasonably incur as a result of such payment, including without
limitation, any loss or expense incurred by reason of the liquidation or
redeployment of funds acquired by Lessor to make any Equity Investment hereunder
or under the Agency Agreement.
LIBOR RATE means with respect to the applicable LIBOR Period, the Adjusted LIBOR
plus 1.80%.
LIBOR RESERVE PERCENTAGE for any LIBOR Period, means the reserve percentage
(expressed as a decimal) on the applicable LIBOR Interest Setting Date, under
regulations issued from time to time by the Board of Governors of the Federal
Reserve System (or any successor) for determining the maximum reserve
requirement (including, without limitation, any emergency, supplemental or other
marginal reserve requirement) for Fleet, at its principal office with respect to
liabilities or assets consisting of or including Eurocurrency Liabilities, as
such term is defined in Regulation D Board of Governors of the Federal Reserve
System, as in effect from time to time (or with respect to any other category of
liabilities which includes deposit by reference to which the interest rate on
LIBOR Rate Advances is determined (having a term equal to such LIBOR Period).
70
SCHEDULE C
TERMINATION VALUES
(1) CONSTRUCTION TERM. During the Construction Term, the Termination Value
is the sum of (i) all amounts payable by Lessee hereunder, including
without limitation, accrued Basic Rent, Additional Rent, and all other
sums payable hereunder to the date of payment of the Termination Value,
plus (ii) the sum of all Lessor Advances made pursuant to Article 3 of
the Agency Agreement , plus (iii) an amount equal to the Equity Return
(if any) which has accrued from the last date Basic Rent Payment Date
through the date of payment of the Termination Value.
Anything to the contrary contained in this Lease and/or the Agency
Agreement notwithstanding, in no event during the Construction Term
(other than with respect to (x) a default under clause (iii), (iv) or
(v) of Article 22(a) or (y) a default under clause (ii) of Article
22(a) arising out of Lessee's default in the performance of any
covenant, agreement or obligation on the part of Lessee to be performed
under Article 9 of this Lease or (z) payment of a Purchase Price
required to be made with respect to a purchase of the Leased Premises
by Lessee) shall Lessee be required to pay any amount which will cause
the aggregate amounts paid under this Lease during the Construction
Term to equal or exceed the sum of (a) 90% of the total Cost of the
Project other than land acquisition costs as defined by EITF97-10 and
(b) 100% of such land acquisition costs. For the purposes of this
Lease, including without limitation Schedule G, Lessor and Lessee
hereby agree that such land acquisition costs are equal to $9,000,000.
(2) BASIC TERM. During the Basic Term, the Termination Value shall be an
amount equal to the sum of (i) the then outstanding amount of the
Equity Investment plus (ii) all amounts payable by Lessee hereunder,
including, without limitation, Basic Rent (but not any Additional
Installment of Basic Rent and not capitalized Basic Rent otherwise
included in the Equity Investment), Additional Rent and all other sums
payable hereunder to the date of payment of the Termination Value plus
(iii) an amount equal to the Equity Return (if any) which has accrued
from the last Basic Rent Payment Date. The Equity Investment shall be
calculated on the Basic Term Commencement Date and set forth on a
supplement to this Schedule C.
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SCHEDULE D
[Reserved]
72
SCHEDULE E
ENVIRONMENTAL MATTERS
73
SCHEDULE F
PURCHASE PRICES
The Purchase Price as of any date of purchase of the Leased Property shall be an
amount equal to the sum of (i) the Termination Value in effect as of such date
of purchase plus (ii) all payments required pursuant to clause (b)(iii) of
Article 16.
74
SCHEDULE G
Maximum Lessor and
Lessee Risk Amounts
-------------------
During the Basic Term, the Maximum Lessor Risk Amount shall be equal to the
Cost of the Project as of the last day of the Construction Term multiplied by
.15. During the Construction Term, the Maximum Lessor Risk amount on any date of
calculation shall be equal to Cost of the Project minus the Maximum Lessee Risk
Amount.
During the Basic Term, the Maximum Lessee Risk Amount shall be equal to the
Cost of the Project as of the last day of the Construction Term multiplied by
.85. During the Construction Term, the Maximum Lessee Risk Amount on any date of
calculation shall be less than the sum of (a) 90% of the Cost of the Project
other than land acquisition costs as defined by EITF 97-10 and (b) 100% of such
land acquisition costs.
75
SCHEDULE H
Additional Permitted Encumbrances
---------------------------------
Those matters set forth on Schedule B to ____________________ Title
Insurance Company ALTA Owner's Policy No. _______________.
76
SCHEDULE I
[Reserved]
