Exhibit 10.3
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LEASE AGREEMENT BETWEEN
W9/TIB REAL ESTATE LIMITED PARTNERSHIP,
AS LANDLORD, AND
ERUNWAY, INC.,
AS TENANT
DATED AS OF JUNE __, 0000
XXXXXXXXXXX, XXXXXXXXXXXXX
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MASSACHUSETTS OFFICE LEASE FORM
VERSION 13 - LAST REVISED AUGUST 1999
BASIC LEASE INFORMATION
Lease Date: as of June ___, 2000.
Landlord: W9/TIB REAL ESTATE LIMITED PARTNERSHIP, a
Delaware limited partnership.
Tenant: ERUNWAY, INC., a Delaware corporation.
Premises: Suite No. 310, containing 10,499 rentable
square feet, in the building (the "BUILDING"),
whose street address is 0000 Xxxx Xxxx Xxxxx,
Xxxxxxxxxxx, Xxxxxxxxxxxxx. The Premises are
shown cross-hatched on the plan attached to the
Lease as Exhibit A. The term "Building"
includes the land (the "LAND") on which the
Building is located, and the driveways, parking
facilities, and similar improvements located
thereon.
Office Park: The buildings whose street address are 0000
Xxxx Xxxx Xxxxx, Xxxxxxxxxxx, Xxxxxxxxxxxxx,
0000 Xxxx Xxxx Xxxxx, Xxxxxxxxxxx,
Xxxxxxxxxxxxx, 0000 Xxxx Xxxx Xxxxx,
Xxxxxxxxxxx, Xxxxxxxxxxxxx, 0000 Xxxx Xxxx
Xxxxx, Xxxxxxxxxxx, Xxxxxxxxxxxxx, and 0000
Xxxx Xxxx Xxxxx, Xxxxxxxxxxx, Xxxxxxxxxxxxx,
and the land on which such buildings are
located and all other buildings or improvements
now or hereafter located on such land. The
parcels of land which presently comprise the
Office Park (the "OFFICE PARK LAND") are
described on Exhibit B attached hereto.
Term: Approximately 60 months, commencing on the
Commencement Date and ending at 5:00 p.m. local
time on the last day of the 60th full calendar
month following the Commencement Date, subject
to adjustment and earlier termination as
provided in the Lease.
Commencement Date: The earlier of (a) the date on which Tenant
occupies any portion of the Premises and begins
conducting business therein, or (b) July 1,
2000 (provided, that if Landlord is unable to
deliver possession of the Premises to Tenant by
such date, then, as provided in Section 3 of
the Lease, Tenant shall accept possession of
the Premises on the date Landlord tenders
possession thereof to Tenant, which date will
then be the "Commencement Date").
Basic Rent: Basic Rent shall be the following amounts for
the following periods of time:
Lease Month Monthly Basic Rent
----------- ------------------
1 - 60 $21,872.92
As used herein, the term "LEASE MONTH" shall
mean each calendar month during the Term (and
if the Commencement Date does not occur on the
first day of a calendar month, the period from
the Commencement Date to the first day of the
next calendar month shall be included in the
first Lease Month for purposes of determining
the duration of the Term and the monthly Basic
Rent rate applicable
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for such partial month).
Security Deposit: $262,475.04.
Additional Security Deposit: $291,199.96
Rent: Basic Rent, Tenant's Proportionate Share of
Taxes and Electrical Costs, Tenant's share of
Additional Rent, and all other sums that Tenant
may owe to Landlord or otherwise be required to
pay under the Lease.
Permitted Use: General office use.
Tenant's Proportionate Share: 16.62%, which is the percentage obtained by
dividing (a) the number of rentable square feet
in the Premises as stated above by (b) 63,180,
which is the number of rentable square feet in
the Building. Landlord and Tenant stipulate
that the number of rentable square feet in the
Premises and in the Building set forth above
shall be binding upon them.
Expense Stop: Operating Costs per rentable square foot in the
Building for the calendar year 2000 (grossed up
as provided in Section 4.(b)(6) of the Lease).
Base Tax Year: The fiscal year ending June 30, 2001.
Initial Liability Insurance
Amount: $3,000,000.00.
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Tenant's Prior to Commencement Date: Following Commencement Date:
Address: eRunway, Inc. eRunvay, Inc.
000 Xxxx Xxxx Xxxxxx 0000 Xxxx Xxxx Xxxxx
Xxxxxxxxxxx, Xxxxxxxxxxxxx 00000 Xxxxxxxxxxx, Xxxxxxxxxxxxx 00000
Attention: Chief Financial Officer Attention: Chief Financial Officer
Telephone: 000-000-0000 Telephone: 000-000-0000
Telecopy: 508-366-9901 Telecopy: 508-366-9901
Landlord's For all Notices: With a copy to:
Address: W9/TIB Real Estate Limited Partnership W9/TIB Real Estate Limited Partnership
c/o Archon Group, L.P. c/o Archon Group, L.P.
0000 X Xxxxxx, X. X., Xxxxx 000 000 Xxxx Xxx Xxxxxxx Xxxx., Xxxxx 000
Xxxxxxxxxx, X.X. 00000 Xxxxxx, Xxxxx 00000
Attention: Asset Manager Attention: General Counsel - 2000
Telephone: 000-000-0000 Xxxx Xxxx Xxxxx, Xxxxxxxxxxx, Xxxxxxxxxxxxx
Telecopy: 000-000-0000 Telephone: 000-000-0000
Telecopy: 000-000-0000
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The foregoing Basic Lease Information is incorporated into and made a part of
the Lease identified above. If any conflict exists between any Basic Lease
Information and the Lease, then the Lease shall control.
LANDLORD: W9/TIB REAL ESTATE LIMITED PARTNERSHIP,
a Delaware limited partnership
By: W9/TIB Gen-Par, Inc., a Delaware
corporation, its general partner
By: /s/ Xxxxxxx X. Xxxxxxx
------------------------------------
Name: Xxxxxxx X. Xxxxxxx
Title: Assistant Vice President
TENANT: ERUNWAY, INC, a Delaware corporation
By: /s/ XXXX XXXXXXXXXXX
------------------------------------
Name: XXXX XXXXXXXXXXX
Title: SVP
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TABLE OF CONTENTS
PAGE
----
1. Definitions and Basic Provisions ..................................... 1
2. Lease Grant; Common Areas ............................................ 1
3. Tender of Possession ................................................. 2
4. Rent ................................................................. 2
(a) Payment .......................................................... 2
(b) Operating Costs; Taxes; Electrical Costs ......................... 2
(c) Tenant Inspection Right .......................................... 4
5. Delinquent Payment; Handling Charges ................................. 5
6. Security Deposit ..................................................... 5
7. Landlord's Obligations ............................................... 6
(a) Services ......................................................... 6
(b) Excess Utility Use ............................................... 7
(c) Restoration of Services .......................................... 7
(d) Alternate Service Provide ........................................ 7
8. Improvements; Alterations; Repairs; Maintenance ...................... 8
(a) Improvements; Alterations ........................................ 8
(b) Repairs; Maintenance ............................................. 8
(c) Performance of Work .............................................. 8
(d) Mechanic's Liens ................................................. 8
9. Use .................................................................. 9
10. Assignment and Subletting ........................................... 9
(a) Transfers ........................................................ 9
(b) Consent Standards ................................................ 9
(c) Request for Consent .............................................. 9
(d) Conditions to Consent ............................................ 10
(e) Cancellation ..................................................... 10
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(f) Additional Compensation .......................................... 10
(g) Permitted Transfers .............................................. 10
00.Xxxxxxxxx; Waivers; Subrogation; Indemnity ........................... 11
(a) Tenant's Insurance ............................................... 11
(b) Landlord's Insurance ............................................. 12
(c) No Subrogation ................................................... 12
(d) Indemnity ........................................................ 12
12.Subordination; Attornment; Notice to Landlord's Mortgagee ............ 12
(a) Subordination .................................................... 12
(b) Attornment ....................................................... 13
(c) Notice to Landlord's Mortgagee ................................... 13
(d) Landlord's Mortgagee's Protection Provisions ..................... 13
13.Rules and Regulations ................................................ 13
14.Condemnation ......................................................... 13
(a) Total Taking ..................................................... 13
(b) Partial Taking-Tenant's Rights ................................... 13
(c) Partial Taking-Landlord's Rights ................................. 14
(d) Award ............................................................ 14
00.Xxxx or Other Casualty ............................................... 14
(a) Repair Estimate .................................................. 14
(b) Tenant's Rights .................................................. 14
(c) Landlord's Rights ................................................ 14
(d) Repair Obligation ................................................ 14
(e) Abatement of Rent ................................................ 15
16.Personal Property Taxes .............................................. 15
00.Xxxxxx of Default .................................................... 15
(a) Payment Default .................................................. 15
(b) Abandonment ...................................................... 15
(c) Estoppel ......................................................... 15
(d) Other Defaults ................................................... 15
(e) Insolvency ....................................................... 15
(e) Additional Security Deposit ...................................... 16
18.Remedies ............................................................. 16
(a) Termination of Lease ............................................. 16
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(b) Termination of Possession ........................................ 16
(c) Alteration of Locks .............................................. 16
19.Payment by Tenant; Non-Waiver; Cumulative Remedies ................... 16
(a) Payment by Tenant ................................................ 16
(b) No Waiver ........................................................ 17
(c) Cumulative Remedies .............................................. 17
20.Landlord's Lien ...................................................... 17
21.Surrender of Premises ................................................ 17
22.Holding Over ......................................................... 18
23.Certain Rights Reserved by Landlord .................................. 18
(a) Building Operations .............................................. 18
(b) Security ......................................................... 18
(c) Prospective Purchasers and Lenders ............................... 18
(d) Prospective Tenants .............................................. 18
24.[Intentionally Omitted] .............................................. 19
25.Miscellaneous ........................................................ 19
(a) Landlord Transfer ................................................ 19
(b) Landlord's Liability ............................................. 19
(c) Force Majeure .................................................... 19
(d) Brokerage ........................................................ 19
(e) Estoppel Certificates ............................................ 19
(f) Notices .......................................................... 19
(g) Separability ..................................................... 19
(h) Amendments; and Binding Effect ................................... 20
(i) Quiet Enjoyment .................................................. 20
(j) No Merger ........................................................ 20
(k) No Offer ......................................................... 20
(1) Entire Agreement ................................................. 20
(m) Waiver of Jury Trial ............................................. 20
(n) Governing Law .................................................... 20
(o) Recording ........................................................ 20
(p) Joint and Several Liability ...................................... 20
(q) Financial Reports ................................................ 20
(r) Landlord's Fees .................................................. 21
(s) Telecommunications ............................................... 21
(t) Confidentiality .................................................. 21
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(u) Authority ........................................................ 21
(v) Hazardous Materials .............................................. 22
(w) List of Exhibits ................................................. 22
26.Other Provisions ..................................................... 22
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LEASE
THIS LEASE AGREEMENT (this "LEASE") is entered into as of
June _________________, 2000, between W9/TIB REAL ESTATE LIMITED PARTNERSHIP, a
Delaware limited partnership ("LANDLORD"), and ERUNWAY, INC., a Delaware
corporation ("TENANT").
1. DEFINITIONS AND BASIC PROVISIONS. The definitions and basic provisions
set forth in the Basic Lease Information (the "BASIC LEASE INFORMATION")
executed by Landlord and Tenant contemporaneously herewith are incorporated
herein by reference for all purposes. Additionally, the following terms shall
have the following meanings when used in this Lease: "AFFILIATE" means any
person or entity which, directly or indirectly, through one or more
intermediaries, controls, is controlled by, or is under common control with the
party in question; "BUILDING'S STRUCTURE" means the Building's exterior walls,
roof, elevator shafts, footings, foundations, structural portions of
load-bearing walls, structural floors and subfloors, and structural columns and
beams; "BUILDING'S SYSTEMS" means the Building's HVAC, life-safety, plumbing,
electrical, and mechanical systems; "INCLUDING" means including, without
limitation; "LAWS" means all federal, state, and local laws, rules and
regulations, all court orders, governmental directives, and governmental orders,
and all restrictive covenants affecting the Building, and "LAW" shall mean any
of the foregoing; and "TENANT PARTY" means any of the following persons: Tenant;
any assignees claiming by, through, or under Tenant; any subtenants claiming by,
through, or under Tenant; and any of their respective agents, contractors,
employees, and invitees.
2. LEASE GRANT; COMMON AREAS. Subject to the terms of this Lease, Landlord
leases to Tenant, and Tenant leases from Landlord, the Premises.
Tenant shall have the non-exclusive right during the Term to use the Common
Areas (as defined below) for itself, its employees, agents, customers, invitees
and licensees. The phrase "COMMON AREAS" as used herein shall mean the portions
of the Building which are from time to time designated and improved for common
use by or for the benefit of more than one tenant of the Building, including,
but not limited to, any of the following: the land and facilities used as
parking areas, access and perimeter roads, landscaping areas, exterior walks,
stairways, ramps, interior corridors, stairs, but excluding any portion thereof
when designated by Landlord for a non-common use. All Common Areas shall be
subject to the exclusive control and management of Landlord. Landlord shall have
the right to (i) to close, if necessary, all or any portion of the Common Areas
to such extent as may be legally necessary to prevent a dedication thereof or
the accrual of any rights of any person or of the public therein; (ii) to close
temporarily all or any portion of the Common Areas to discourage non-tenant use;
(iii) to use portions of the Common Areas while engaged in making additional
improvements or repairs or alterations to the Building; and (iv) to do and
perform such other acts in, to and with respect to the Common Areas as Landlord
shall determine to be appropriate for the Building. Landlord shall have the
right to increase the size of the Common Areas, including the expansion thereof
to adjacent property, to reduce the Common Area, to reconfigure the parking
spaces and improvements on the Common Areas, and to make such changes therein
and thereto from time to time which in Landlord's opinion are desirable and in
the best interests of all persons using the Common Areas. Any portion of the
Building not originally included within the Common Areas shall be so included if
and when so designated by Landlord for common use. Tenant shall use and shall
use reasonable efforts to cause its agents, employees, invitees, vendors,
suppliers and independent contractors to use such access roads and operate
trucks and trailers delivering merchandise to and from the Premises upon and
over such access roads as are designated by Landlord as a means of ingress to
and egress from the Premises. Landlord may establish a system or systems of
validation or other type of operation to control the parking areas within
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the Common Areas. Nothing contained in this Lease shall prohibit or otherwise
restrict Landlord from changing, from time to time, the location, layout or type
of parking areas within the Common Areas.
3. TENDER OF POSSESSION. Landlord and Tenant presently anticipate that
possession of the Premises will be tendered to Tenant (with the Work to be
performed by Landlord therein, if any, Substantially Completed) on or about July
1, 2000 (the "ESTIMATED DELIVERY DATE"). If Landlord is unable to tender
possession of the Premises in such condition to Tenant by the Estimated Delivery
Date, then (a) Landlord shall not be in default hereunder or be liable for
damages therefor, and (b) Tenant shall accept possession of the Premises when
Landlord tenders possession thereof to Tenant. By occupying the Premises, Tenant
shall be deemed to have accepted the Premises in their condition as of the date
of such occupancy, subject to the performance of punch-list items that remain to
be performed by Landlord, if any. Tenant shall execute and deliver to Landlord,
within 10 days after Landlord has requested the same, a letter substantially in
the form of Exhibit E hereto confirming (1) the Commencement Date and the
expiration date of the initial Term, (2) that Tenant has accepted the Premises,
and (3) that Landlord has performed all of its obligations with respect to the
Premises (except for punch-list items specified in such letter). Occupancy of
the Premises by Tenant prior to the Commencement Date shall be subject to all of
the provisions of this Lease excepting only those requiring the payment of Basic
Rent, Additional Rent, Taxes and Electrical Costs (each as defined herein).
4. RENT.
(a) PAYMENT. Tenant shall timely pay to Landlord Rent, without notice,
demand, deduction or set off (except as otherwise expressly provided herein), at
Landlord's address provided for in this Lease or as otherwise specified by
Landlord and shall be accompanied by all applicable state and local sales or use
taxes. Basic Rent, adjusted as herein provided, shall be payable monthly in
advance. The first monthly installment of Basic Rent shall be payable
contemporaneously with the execution of this Lease; thereafter, Basic Rent shall
be payable on the first day of each month beginning on the first day of the
second full calendar month of the Term. The monthly Basic Rent for any partial
month at the beginning of the Term shall equal the product of 1/365 of the
annual Basic Rent in effect during the partial month and the number of days in
the partial month from and after the Commencement Date, and shall be due on the
Commencement Date.
(b) OPERATING COSTS; TAXES; ELECTRICAL COSTS.
(1) Tenant shall pay to Landlord the amount (per each rentable
square foot in the Premises) ("ADDITIONAL RENT") by which the annual
Operating Costs (defined below) per rentable square foot in the Building
exceed the Expense Stop (per rentable square foot in the Building).
Landlord may make a good faith estimate of the Additional Rent to be due by
Tenant for any calendar year or part thereof during the Term. During each
calendar year or partial calendar year of the Term (after the base year, if
the Expense Stop is calculated on a base year basis), Tenant shall pay to
Landlord, in advance concurrently with each monthly installment of Basic
Rent, an amount equal to the estimated Additional Rent for such calendar
year or part thereof divided by the number of months therein. From time to
time, Landlord may estimate and re-estimate the Additional Rent to be due
by Tenant and deliver a copy of the estimate or re-estimate to Tenant.
Thereafter, the monthly installments of Additional Rent payable by Tenant
shall be appropriately adjusted in accordance with the estimations so that,
by the end of the calendar year in question, Tenant shall have paid all of
the Additional Rent as estimated by Landlord. Any amounts paid based on
such an estimate shall be subject to adjustment as herein provided when
actual Operating Costs are available for each calendar year.
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(2) The term "OPERATING COSTS" shall mean all expenses and
disbursements (subject to the limitations set forth below) that Landlord
incurs in connection with the ownership, operation, and maintenance of the
Building, determined in accordance with sound accounting principles
consistently applied, including the following costs: (A) wages and salaries
(including management fees) of all on-site employees at or below the grade
of senior building manager engaged in the operation, maintenance or
security of the Building (together with Landlord's reasonable allocation of
expenses of off-site employees at or below the grade of senior building
manager who perform a portion of their services in connection with the
operation, maintenance or security of the Building), including taxes,
insurance and benefits relating thereto; (B) all supplies and materials
used in the operation, maintenance, repair, replacement, and security of
the Building; (C) costs for improvements made to the Building which,
although capital in nature, are expected to reduce the normal operating
costs (including all utility costs) of the Building, as amortized using a
commercially reasonable interest rate over the time period reasonably
estimated by Landlord to recover the costs thereof taking into
consideration the anticipated cost savings, as determined by Landlord using
its good faith, commercially reasonable judgment, as well as capital
improvements made in order to comply with any Law hereafter promulgated by
any governmental authority or any interpretation hereafter rendered with
respect to any existing Law, as amortized using a commercially reasonable
interest rate over the useful economic life of such improvements as
determined by Landlord in its reasonable discretion; (D) cost of all
utilities, except Electrical Costs and the cost of other utilities
reimbursable to Landlord by the Building's tenants other than pursuant to a
provision similar to this Section 4.(b); (E) insurance expenses; (F)
repairs, replacements, and general maintenance of the Building; and (G)
service or maintenance contracts with independent contractors for the
operation, maintenance, repair, replacement, or security of the Building
(including alarm service, window cleaning, and elevator maintenance).
Operating Costs shall also include the Building's pro rata share of
the costs of operating, managing, maintaining and cleaning (including,
without limitation, snow and ice removal) the common areas and facilities
of the Office Park shared by the Building and other buildings in the Office
Park, including, without limitation, the costs of landscaping, insurance,
security, snow plowing/sanding; the cost of maintaining and repairing the
entrance and side roads and sidewalks within the Office Park, the drainage
system, the Office Park directory and signage, the irrigation system and
the street lights: and the cost of providing electricity to the street
lights. The Building's pro rata share (as referred to in the preceding
sentence) shall be equal to a fraction, the numerator of which is the total
number of rentable square feet of floor area in the Building and the
denominator of which is the total number of rentable square feet of floor
area in all the buildings in the Office Park, from time to time.
Operating Costs shall not include costs for (i) capital improvements
made to the Building, other than capital improvements described in Section
4.(b)(2)(C) and except for items which are generally considered maintenance
and repair items, such as painting of common areas, replacement of carpet
in elevator lobbies, and the like; (ii) repair, replacements and general
maintenance paid by proceeds of insurance or by Tenant or other third
parties; (iii) interest, amortization or other payments on loans to
Landlord; (iv) depreciation; (v) leasing commissions; (vi) legal expenses
for services, other than those that benefit the Building tenants generally
(e.g., tax disputes); (vii) renovating or otherwise improving space for
occupants of the Building or vacant space in the Building; (viii) Taxes;
and (ix) federal income taxes imposed on or measured by the income of
Landlord from the operation of the Building. If the Expense Stop is
calculated on a base year basis, Operating Costs for the base year only
shall not include market-wide labor-rate increases due to extraordinary
circumstances, including boycotts and strikes; utility rate increases due
to extraordinary circumstances, including conservation surcharges,
boycotts, embargos or other
3
shortages; or amortized costs relating to capital improvements.
(3) Tenant shall also pay its Proportionate Share of any increase
in Taxes for each year and partial year falling within the Term over the
Taxes for the Base Tax Year. Tenant shall pay its Proportionate Share of
Taxes in the same manner as provided above for Additional Rent with regard
to Operating Costs. "TAXES" shall mean taxes, assessments, and governmental
charges or fees whether federal, state, county or municipal, and whether
they be by taxing districts or authorities presently taxing or by others,
subsequently created or otherwise, and any other taxes and assessments
(including non-governmental assessments for common charges under a
restrictive covenant or other private agreement that are not treated as
part of Operating Costs) now or hereafter attributable to the Building (or
its operation), excluding, however, penalties and interest thereon and
federal and state taxes on income (if the present method of taxation
changes so that in lieu of the whole or any part of any Taxes, there is
levied on Landlord a capital tax directly on the rents received therefrom
or a franchise tax, assessment, or charge based, in whole or in part, upon
such rents for the Building, then all such taxes, assessments, or charges,
or the part thereof so based, shall be deemed to be included within the
term "Taxes" for purposes hereof). Taxes shall include the costs of
consultants retained in an effort to lower taxes and all costs incurred in
disputing any taxes or in seeking to lower the tax valuation of the
Building. For property tax purposes, Tenant waives all rights to protest or
appeal the appraised value of the Premises, as well as the Building, and
all rights to receive notices of reappraisement.
(4) Tenant shall also pay to Landlord Tenant's Proportionate
Share of the cost of all electricity used by the Building ("ELECTRICAL
COSTS"). Such amount shall be payable in monthly installments on the
Commencement Date and on the first day of each calendar month thereafter.
Each installment shall be based on Landlord's estimate of the amount due
for each month. From time to time during any calendar year, Landlord may
estimate or re-estimate the Electrical Costs to be due by Tenant for that
calendar year and deliver a copy of the estimate or re-estimate to Tenant.
Thereafter, the monthly installments of Electrical Costs payable by Tenant
shall be appropriately adjusted in accordance with the estimations.
(5) By April 1 of each calendar year, or as soon thereafter as
practicable, Landlord shall furnish to Tenant a statement of Operating
Costs and Electrical Costs for the previous year, in each case adjusted as
provided in Section 4.(b)(6), and of the Taxes for the previous year (the
"OPERATING COSTS AND TAX STATEMENT"). If the Operating Costs and Tax
Statement reveals that Tenant paid more for Operating Costs or Electrical
Costs than the actual amount for the year for which such statement was
prepared, or more than its actual share of Taxes for such year, then
Landlord shall promptly credit or reimburse Tenant for such excess;
likewise, if Tenant paid less than Tenant's actual Proportionate Share of
Additional Rent or share of Taxes due, then Tenant shall promptly pay
Landlord such deficiency.
(6) With respect to any calendar year or partial calendar year in
which the Building is not occupied to the extent of 95% of the rentable
area thereof, the Operating Costs and Electrical Costs for such period
shall, for the purposes hereof, be increased to the amount which would have
been incurred had the Building been occupied to the extent of 95% of the
rentable area thereof.
(c) TENANT INSPECTION RIGHT. Provided no Event of Default then exists
after receiving an annual Operating Costs and Tax Statement and giving Landlord
30 days' prior written notice thereof, Tenant may inspect or audit Landlord's
records relating to Operating Costs for the period of time covered by such
Operating Costs and Tax Statement in accordance with the following provisions.
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If Tenant fails to object to the calculation of Operating Costs on an annual
Operating Costs and Tax Statement within 30 days after the statement has been
delivered to Tenant, or if Tenant fails to conclude its audit or inspection
within 90 days after the statement has been delivered to Tenant, then Tenant
shall have waived its right to object to the calculation of Operating Costs for
the year in question and the calculation of Operating Costs set forth on such
statement shall be final. Tenant's audit or inspection shall be conducted where
Landlord maintains its books and records, shall not unreasonably interfere with
the conduct of Landlord's business, and shall be conducted only during business
hours reasonably designated by Landlord. Tenant shall pay the cost of such audit
or inspection, including $150 per hour of Landlord's or the building manager's
employee time devoted to such inspection or audit, to reimburse Landlord for its
overhead costs allocable to the inspection or audit, unless the total Operating
Costs for the period in question is determined to be in error by more than 5% in
the aggregate, and, as a result thereof, Tenant paid to Landlord $1.00 per
square foot in the Premises more than the actual Operating Costs due for such
period, in which case Landlord shall pay the audit cost (not to exceed the
amount Tenant was overcharged for the period in question). Tenant may not
conduct an inspection or have an audit performed more than once during any
calendar year. Tenant or the accounting firm conducting such audit shall, at no
charge to Landlord, submit its audit report in draft form to Landlord for
Landlord's review and comment before the final approved audit report is
submitted to Landlord, and any reasonable comments by Landlord shall be
incorporated into the final audit report. If such inspection or audit reveals
that an error was made in the Operating Costs previously charged to Tenant, then
Landlord shall refund to Tenant any overpayment of any such costs, or Tenant
shall pay to Landlord any underpayment of any such costs, as the case may be,
within 30 days after notification thereof. Provided Landlord's accounting for
Operating Costs is consistent with the terms of this Lease, Landlord's good
faith judgment regarding the proper interpretation of this Lease and the proper
accounting for Operating Costs shall be binding on Tenant in connection with any
such audit or inspection. Tenant shall maintain the results of each such audit
or inspection confidential and shall not be permitted to use any third party to
perform such audit or inspection, other than an independent firm of certified
public accountants (1) reasonably acceptable to Landlord, (2) which is not
compensated on a contingency fee basis or in any other manner which is dependent
upon the results of such audit or inspection (and Tenant shall deliver the fee
agreement or other similar evidence of such fee arrangement to Landlord upon
request), and (3) which agrees with Landlord in writing to maintain the results
of such audit or inspection confidential. Notwithstanding the foregoing, Tenant
shall have no right to conduct an audit if Landlord furnishes to Tenant an audit
report for the period of time in question prepared by an independent certified
public accounting firm of recognized national standing (whether originally
prepared for Landlord or another party). Nothing in this Section 4.(c) shall be
construed to limit, suspend or xxxxx Tenant's obligation to pay Rent, including
Additional Rent, when due.
5. DELINQUENT PAYMENT; HANDLING CHARGES. All past due payments required of
Tenant hereunder shall bear interest from the date due until paid at the lesser
of 18% per annum or the maximum lawful rate of interest; additionally, Landlord
may charge Tenant a fee equal to 5% of the delinquent payment to reimburse
Landlord for its cost and inconvenience incurred as a consequence of Tenant's
delinquency. In no event, however, shall the charges permitted under this
Section 5 or elsewhere in this Lease, to the extent they are considered to be
interest under applicable Law, exceed the maximum lawful rate of interest.
Notwithstanding the foregoing, the late fee referenced above shall not be
charged with respect to the first occurrence (but not any subsequent occurrence)
during any 12-month period that Tenant fails to make payment when due, until 5
days after Landlord delivers written notice of such delinquency to Tenant.
6. SECURITY DEPOSIT. Contemporaneously with the execution of this Lease,
Tenant shall pay to Landlord the Security Deposit, which shall be held by
Landlord to secure Tenant's performance of its obligations under this Lease. The
Security Deposit is not an advance payment of Rent or a measure or limit
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of Landlord's damages upon an Event of Default (as defined herein). Landlord
may, from time to time following an Event of Default and without prejudice to
any other remedy, use all or a part of the Security Deposit to perform any
obligation Tenant fails to perform hereunder. Following any such application of
the Security Deposit, Tenant shall pay to Landlord on demand the amount so
applied in order to restore the Security Deposit to its original amount.
Provided that Tenant has performed all of its obligations hereunder, Landlord
shall, within 30 days after the Term ends, return to Tenant the portion of the
Security Deposit which was not applied to satisfy Tenant's obligations. The
Security Deposit may be commingled with other funds, and no interest shall be
paid thereon. If Landlord transfers its interest in the Premises and the
transferee assumes Landlord's obligations under this Lease, then Landlord may
assign the Security Deposit to the transferee and Landlord thereafter shall have
no further liability for the return of the Security Deposit.
In lieu of a Security Deposit in immediately available funds, Tenant may
deliver to Landlord a standby, unconditional, irrevocable letter of credit in
the face amount of the Security Deposit, naming Landlord as beneficiary, issued
by any of the 5 largest national banking associations with banking offices in
Dallas, Texas, permitting partial draws thereon, and otherwise in the form of
Exhibit J attached hereto or another form reasonably acceptable to Landlord.
Tenant shall from time to time cause its letter of credit to be renewed no later
than 30 days prior to any expiration date thereof so that its letter of credit
remains in effect for 30 days after the scheduled expiration date of the Term or
any renewal Term; if Tenant fails timely to renew its letter of credit, then
Landlord shall have the right to draw thereon, and retain the amounts so drawn
as the Security Deposit. Landlord may draw upon the letter of credit and apply
the proceeds thereof to perform any of Tenant's unperformed obligations under
this Lease. After any such draw, Tenant shall pay to Landlord on demand the
amount so drawn to be held as part of the Security Deposit. Tenant hereby
irrevocably appoints Landlord its true and lawful attorney-in-fact, such power
of attorney being coupled with an interest, with full power of substitution, to
do any one or more of the following in its sole discretion upon the occurrence
of an Event of Default under the Lease: (a) demand, collect, receive, xxx for,
compound and give acquittance for any and all amounts which may be or become due
or payable with respect to the letter of credit and all funds evidenced thereby,
(b) execute any and all withdrawal receipts or others orders for the payment of
monies drawn from the letter of credit, (c) endorse the name of Tenant on all
commercial paper given in payment or in partial payment of the letter of credit,
(d) file any claim or institute any proceeding with respect to the letter of
credit, (e) transfer the letter of credit into the name of Landlord or its
nominee, and (f) take any other action which Landlord may deem necessary or
appropriate to protect and preserve the right, title, and interest of Landlord
under the Lease. To further secure Tenant's obligations under the Lease, Tenant
hereby pledges to Landlord and grants to Landlord a security interest in, the
letter of credit, and all renewals and replacements thereof, and proceeds
therefrom.
7. LANDLORD'S OBLIGATIONS.
(a) SERVICES. Landlord shall use all reasonable efforts to furnish to
Tenant (1) water at those points of supply provided for general use of tenants
of the Building; (2) heated and refrigerated air conditioning ("HVAC") as
appropriate, at such temperatures and in such amounts as are standard for
comparable buildings in the vicinity of the Building; (3) janitorial service to
the Premises on weekdays, other than holidays, for Building-standard
installations and such window washing as may from time to time be reasonably
required; (4) elevators for ingress and egress to the floor on which the
Premises are located, in common with other tenants, provided that Landlord may
reasonably limit the number of operating elevators during non-business hours and
holidays; and (5) electrical current during normal business hours for equipment
that does not require more than 110 volts and whose electrical energy
consumption does not exceed normal office usage. Landlord shall maintain the
common areas of the Building in reasonably good order and condition, except for
damage caused by a Tenant Party. If Tenant desires any of the services specified
in Section 7(a)(2): (A) at any time other than between 8:00 a.m. and 5:30 p.m.
on weekdays
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(other than holidays), or (B) on Saturdays, Sundays or holidays, then such
services (i.e, after-hour HVAC services) shall be supplied to Tenant upon the
written request of Tenant delivered to Landlord before 3:00 p.m. on the business
day preceding such extra usage, and Tenant shall pay to Landlord the cost of
such services within 30 days after Landlord has delivered to Tenant an invoice
therefor. The costs incurred by Landlord in providing after-hour HVAC service to
Tenant shall include costs for electricity, water, sewage, water treatment,
labor, metering, filtering, and maintenance reasonably allocated by Landlord to
providing such service.
(b) EXCESS UTILITY USE. Landlord shall not be required to furnish
electrical current for equipment that requires more than 110 volts or other
equipment whose electrical energy consumption exceeds normal office usage. If
Tenant's requirements for or consumption of electricity exceed the electricity
to be provided by Landlord as described in Section 7.(a), Landlord shall, at
Tenant's expense, make reasonable efforts to supply such service through the
then-existing feeders and risers serving the Building and the Premises, and
Tenant shall pay to Landlord the cost of such service within 30 days after
Landlord has delivered to Tenant an invoice therefor. Landlord may determine the
amount of such additional consumption and potential consumption by any
verifiable method, including installation of a separate meter in the Premises
installed, maintained, and read by Landlord, at Tenant's expense. Tenant shall
not install any electrical equipment requiring special wiring or requiring
voltage in excess of 110 volts or otherwise exceeding Building capacity unless
approved in advance by Landlord. The use of electricity in the Premises shall
not exceed the capacity of existing feeders and risers to or wiring in the
Premises. Any risers or wiring required to meet Tenant's excess electrical
requirements shall, upon Tenant's written request, be installed by Landlord, at
Tenant's cost, if, in Landlord's judgment, the same are necessary and shall not
cause permanent damage to the Building or the Premises, cause or create a
dangerous or hazardous condition, entail excessive or unreasonable alterations,
repairs, or expenses, or interfere with or disturb other tenants of the
Building. If Tenant uses machines or equipment in the Premises which affect the
temperature otherwise maintained by the air conditioning system or otherwise
overload any utility, Landlord may install supplemental air conditioning units
or other supplemental equipment in the Premises, and the cost thereof, including
the cost of installation, operation, use, and maintenance, shall be paid by
Tenant to Landlord within 30 days after Landlord has delivered to Tenant an
invoice therefor.
(c) RESTORATION OF SERVICES. Landlord shall use reasonable efforts to
restore any service required of it that becomes unavailable; however, such
unavailability shall not render Landlord liable for any damages caused thereby,
be a constructive eviction of Tenant, constitute a breach of any implied
warranty, or entitle Tenant to any abatement of Tenant's obligations hereunder.
(d) ALTERNATE SERVICE PROVIDER. Landlord has advised Tenant that
presently Massachusetts Electric Company (the "ELECTRIC SERVICE PROVIDER") is
the electric utility company selected by Landlord to provide electricity service
for the Building. Notwithstanding the foregoing, Landlord reserves the right at
any time and from time to time before or during the Term to either contract for
electric service from a different company or companies providing electricity
service (each such company shall hereinafter be referred to as an "ALTERNATIVE
SERVICE PROVIDER") or continue to contact for electricity service from the
Electric Service Provider. Tenant shall cooperate with Landlord, the Electric
Service Provider and any Alternative Service Provider at all times and, as
reasonably necessary, shall allow Landlord, the Electric Service Provider and
any Alternative Service Provider reasonable access to the Building's electric
lines, feeders, risers, wiring and other machinery within the Premises.
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8. IMPROVEMENTS; ALTERATIONS; REPAIRS; MAINTENANCE.
(a) IMPROVEMENTS; ALTERATIONS. Improvements to the Premises shall be
installed at Tenant's expense only in accordance with plans and specifications
which have been previously submitted to and approved in writing by Landlord,
which approval shall be governed by standards in the following sentence. No
alterations or physical additions in or to the Premises may be made without
Landlord's prior written consent, which shall not be unreasonably withheld or
delayed; however, Landlord may withhold its consent to any alteration or
addition that would adversely affect (in the reasonable discretion of Landlord)
(1) the Building's Structure or the Building's Systems (including the Building's
restrooms or mechanical rooms), (2) the exterior appearance of the Building, or
(3) the appearance of the Building's common areas or elevator lobby areas.
Tenant shall not paint or install lighting or decorations, signs, window or door
lettering, or advertising media of any type on or about the Premises without
the prior written consent of Landlord, which shall not be unreasonably withheld
or delayed; however, Landlord may withhold its consent to any such painting or
installation which, would affect the appearance of the exterior of the Building
or of any common areas of the Building. All alterations, additions, and
improvements shall be constructed, maintained, and used by Tenant at its risk
and expense, in accordance with all Laws; Landlord's consent to or approval of
any alterations, additions or improvements (or the plans therefor) shall not
constitute a representation or warranty by Landlord, nor Landlord's acceptance,
that the same comply with sound architectural and/or engineering practices or
with all applicable Laws, and Tenant shall be solely responsible for ensuring
all such compliance.
(b) REPAIRS; MAINTENANCE. Tenant shall maintain the Premises in a
clean, safe, and operable condition, and shall not permit or allow to remain any
waste or damage to any portion of the Premises. Tenant shall repair or replace,
subject to Landlord's direction and supervision, any damage to the Building
caused by a Tenant Party. If Tenant fails to make such repairs or replacements
within 15 days after the occurrence of such damage, then Landlord may make the
same at Tenant's cost. If any such damage occurs outside of the Premises, then
Landlord may elect to repair such damage at Tenant's expense, rather than having
Tenant repair such damage. The cost of all repair or replacement work performed
by Landlord under this Section 8 shall be paid by Tenant to Landlord within 30
days after Landlord has invoiced Tenant therefor.
(c) PERFORMANCE OF WORK. All work described in this Section 8 shall be
performed only by Landlord or by contractors and subcontractors approved in
writing by Landlord. Tenant shall cause all contractors and subcontractors to
procure and maintain insurance coverage naming Landlord as an additional insured
against such risks, in such amounts, and with such companies as Landlord may
reasonably require. All such work shall be performed in accordance with all Laws
and in a good and workmanlike manner so as not to damage the Building (including
the Premises, the Building's Structure and the Building's Systems). All such
work which may affect the Building's Structure or the Building's Systems must be
approved by the Building's engineer of record, at Tenant's expense and, at
Landlord's election, must be performed by Landlord's usual contractor for such
work. Tenant shall provide sworn statements, including the names, addresses and
copies of contracts for all contractors, and upon completion of any work shall
promptly furnish Landlord with sworn owner's and contractor's statements and
full and final waivers of lien covering all labor and materials included in the
work in question.
(d) MECHANIC'S LIENS. Tenant shall not permit any mechanic's liens to
be filed against the Premises or the Building for any work performed, materials
furnished, or obligation incurred by or at the request of Tenant. If such a lien
is filed, then Tenant shall, within 10 days after Landlord has delivered notice
of the filing thereof to Tenant (or such earlier time period as may be necessary
to prevent the forfeiture of the Building or any interest of Landlord therein or
the imposition of a civil or criminal fine
8
with respect thereto), either (1) pay the amount of the lien and cause the lien
to be released of record, or (2) diligently contest such lien and deliver to
Landlord a bond or other security reasonably satisfactory to Landlord. If Tenant
fails to timely take either such action, then Landlord may pay the lien claim,
and any amounts so paid, including expenses and interest, shall be paid by
Tenant to Landlord within ten days after Landlord has invoiced Tenant therefor.
All materialmen, contractors, artisans, mechanics, laborers and any other
persons now or hereafter contracting with Tenant or any contractor or
subcontractor of Tenant for the furnishing of any labor, services, materials,
supplies or equipment with respect to any portion of the Premises, at any time
from the date hereof until the end of the Term, are hereby charged with notice
that they look exclusively to Tenant to obtain payment for same. Nothing herein
shall be deemed a consent by Landlord to any liens being placed upon the
Building or Landlord's interest therein due to any work performed by or for
Tenant.
9. USE. Tenant shall continuously occupy and use the Premises only for the
Permitted Use and shall comply with all Laws relating to the use, condition,
access to, and occupancy of the Premises. The population density within the
Premises as a whole shall at no time exceed one person for each 300 rentable
square feet in the Premises. Tenant shall not conduct second or third shift
operations within the Premises; however, Tenant may use the Premises after
normal business hours, so long as Tenant is not generally conducting business
from the Premises after normal business hours. The Premises shall not be used
for any use which is disreputable, creates extraordinary fire hazards, or
results in an increased rate of insurance on the Building or its contents, or
for the storage of any Hazardous Materials (other than typical office supplies
[e.g., photocopier toner] and then only in compliance with all Laws). Tenant
shall not use any substantial portion of the Premises for a "call center," any
other telemarketing use, or any credit processing use. If, because of a Tenant
Party's acts, the rate of insurance on the Building or its contents increases,
then such acts shall be an Event of Default, Tenant shall pay to Landlord the
amount of such increase on demand, and acceptance of such payment shall not
waive any of Landlord's other rights. Tenant shall conduct its business and
control each other Tenant Party so as not to create any nuisance or unreasonably
interfere with other tenants or Landlord in its management of the Building.
10. ASSIGNMENT AND SUBLETTING.
(a) TRANSFERS. Except as provided in Section 10.(g), Tenant shall not,
without the prior written consent of Landlord, (1) assign, transfer, or encumber
this Lease or any estate or interest herein, whether directly or by operation of
law, (2) permit any other entity to become Tenant hereunder by merger,
consolidation, or other reorganization, (3) if Tenant is an entity other than a
corporation whose stock is publicly traded, permit the transfer of an ownership
interest in Tenant so as to result in a change in the current control of Tenant,
(4) sublet any portion of the Premises, (5) grant any license, concession, or
other right of occupancy of any portion of the Premises, or (6) permit the use
of the Premises by any parties other than Tenant (any of the events listed in
Section 10.(a)(l)through 10.(a)(6) being a "TRANSFER").
(b) CONSENT STANDARDS. Landlord shall not unreasonably withhold its
consent to any assignment or subletting of the Premises, provided that the
proposed transferee (A) is creditworthy, (B) has a good reputation in the
business community, (C) will use the Premises for the Permitted Use (thus,
excluding, without limitation, uses for credit processing and telemarketing) and
will not use the Premises in any manner that would conflict with any exclusive
use agreement or other similar agreement entered into by Landlord with any other
tenant of the Building, (D) is not a governmental entity, or subdivision or
agency thereof, and (E) is not another occupant of the Building or person or
entity with whom Landlord is negotiating to lease space in the Building;
otherwise, Landlord may withhold its consent in its sole discretion.
(c) REQUEST FOR CONSENT. If Tenant requests Landlord's consent to a
Transfer, then, at
9
least 15 business days prior to the effective date of the proposed Transfer,
Tenant shall provide Landlord with a written description of all terms and
conditions of the proposed Transfer, copies of the proposed documentation, and
the following information about the proposed transferee: name and address;
reasonably satisfactory information about its business and business history; its
proposed use of the Premises; banking, financial, and other credit information;
and general references sufficient to enable Landlord to determine the proposed
transferee's creditworthiness and character. Concurrently with Tenant's notice
of any request for consent to a Transfer, Tenant shall pay to Landlord a fee of
$1,000 to defray Landlord's expenses in reviewing such request, and Tenant shall
also reimburse Landlord immediately upon request for its reasonable attorneys'
fees incurred in connection with considering any request for consent to a
Transfer.
(d) CONDITIONS TO CONSENT. If Landlord consents to a proposed
Transfer, then the proposed transferee shall deliver to Landlord a written
agreement whereby it expressly assumes Tenant's obligations hereunder; however,
any transferee of less than all of the space in the Premises shall be liable
only for obligations under this Lease that are properly allocable to the space
subject to the Transfer for the period of the Transfer. No Transfer shall
release Tenant from its obligations under this Lease, but rather Tenant and its
transferee shall be jointly and severally liable therefor. Landlord's consent to
any Transfer shall not waive Landlord's rights as to any subsequent Transfers.
If an Event of Default occurs while the Premises or any part thereof are subject
to a Transfer, then Landlord, in addition to its other remedies, may collect
directly from such transferee all rents becoming due to Tenant and apply such
rents against Rent. Tenant authorizes its transferees to make payments of rent
directly to Landlord upon receipt of notice from Landlord to do so following the
occurrence of an Event of Default hereunder. Tenant shall pay for the cost of
any demising walls or other improvements necessitated by a proposed subletting
or assignment.
(e) CANCELLATION. Landlord may, within 30 days after submission of
Tenant's written request for Landlord's consent to an assignment or subletting,
cancel this Lease as to the portion of the Premises proposed to be sublet or
assigned as of the date the proposed Transfer is to be effective. If Landlord
cancels this Lease as to any portion of the Premises, then this Lease shall
cease for such portion of the Premises and Tenant shall pay to Landlord all
Rent accrued through the cancellation date relating to the portion of the
Premises covered by the proposed Transfer. Thereafter, Landlord may lease such
portion of the Premises to the prospective transferee (or to any other person)
without liability to Tenant.
(f) ADDITIONAL COMPENSATION. Tenant shall pay to Landlord, immediately
upon receipt thereof, the excess of (1) all compensation received by Tenant for
a Transfer less the costs reasonably incurred by Tenant with unaffiliated third
parties in connection with such Transfer (i.e., brokerage commissions, tenant
finish work, and the like) over (2) the Rent allocable to the portion of the
Premises covered thereby.
(g) PERMITTED TRANSFERS. Notwithstanding Section 10.(a), Tenant may
Transfer all or part of its interest in this Lease or all or part of the
Premises (a "PERMITTED TRANSFER") to the following types of entities (a
"PERMITTED TRANSFEREE") without the written consent of Landlord:
(1) an Affiliate of Tenant;
(2) any corporation, limited partnership, limited liability
partnership, limited liability company or other business entity in which or
with which Tenant, or its corporate successors or assigns, is merged or
consolidated, in accordance with applicable statutory provisions governing
merger and consolidation of business entities, so long as (A) Tenant's
obligations hereunder are assumed by the entity surviving such merger or
created by such consolidation; and (B) the Tangible Net Worth of the
surviving or created entity is not less than the Tangible Net Worth of
Tenant as of the date hereof; or
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(3) any corporation, limited partnership, limited liability
partnership, limited liability company or other business entity acquiring
all or substantially all of Tenant's assets if such entity's Tangible Net
Worth after such acquisition is not less than the Tangible Net Worth of
Tenant as of the date hereof.
Tenant shall promptly notify Landlord of any such Permitted Transfer. Tenant
shall remain liable for the performance of all of the obligations of Tenant
hereunder, or if Tenant no longer exists because of a merger, consolidation, or
acquisition, the surviving or acquiring entity shall expressly assume in writing
the obligations of Tenant hereunder. Additionally, the Permitted Transferee
shall comply with all of the terms and conditions of this Lease, including the
Permitted Use, and the use of the Premises by the Permitted Transferee may not
violate any other agreements, affecting the Premises, the Building, Landlord or
other tenants of the Building. At least 30 days after the effective date of any
Permitted Transfer, Tenant agrees to furnish Landlord with copies of the
instrument effecting any of the foregoing Transfers and documentation
establishing Tenant's satisfaction of the requirements set forth above
applicable to any such Transfer. The occurrence of a Permitted Transfer shall
not waive Landlord's rights as to any subsequent Transfers. "TANGIBLE NET WORTH"
means the excess of total assets over total liabilities, in each case as
determined in accordance with generally accepted accounting principles
consistently applied ("GAAP"), excluding, however, from the determination of
total assets all assets which would be classified as intangible assets under
GAAP including goodwill, licenses, patents, trademarks, trade names, copyrights,
and franchises. Any subsequent Transfer by a Permitted Transferee shall be
subject to the terms of this Section 10.
11. INSURANCE; WAIVERS; SUBROGATION; INDEMNITY.
(a) TENANT'S INSURANCE. Tenant shall maintain throughout the Term the
following insurance policies: (1) commercial general liability insurance in
amounts of $3,000,000.00 per occurrence or, following the expiration of the
initial Term, such other amounts as Landlord may from time to time reasonably
require (and, if the use and occupancy of the Premises include any activity or
matter that is or may be excluded from coverage under a commercial general
liability policy (e.g., the sale, service or consumption of alcoholic
beverages], Tenant shall obtain such endorsements to the commercial general
liability policy or otherwise obtain insurance to insure all liability arising
from such activity or matter [including liquor liability, if applicable] in
such amounts as Landlord may reasonably require), insuring Tenant, Landlord,
Landlord's agents and their respective Affiliates against all liability for
injury to or death of a person or persons or damage to property arising from the
use and occupancy of the Premises, (2) insurance covering the full value of
Tenant's property and improvements, and other property (including property of
others) in the Premises, (3) contractual liability insurance sufficient to cover
Tenant's indemnity obligations hereunder (but only if such contractual liability
insurance is not already included in Tenant's commercial general liability
insurance policy), (4) worker's compensation insurance, and (5) business
interruption insurance. Tenant's insurance shall provide primary coverage to
Landlord when any policy issued to Landlord provides duplicate or similar
coverage, and in such circumstance Landlord's policy will be excess over
Tenant's policy. Tenant shall furnish to Landlord certificates of such insurance
and such other evidence satisfactory to Landlord of the maintenance of all
insurance coverages required hereunder, and Tenant shall obtain a written
obligation on the part of each insurance company to notify Landlord at least 30
days before cancellation or a material change of any such insurance policies.
All such insurance policies shall be in form, and issued by companies,
reasonably satisfactory to Landlord.
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(b) LANDLORD'S INSURANCE. Throughout the Term of this Lease, Landlord
shall maintain, as a minimum, the following insurance policies: (1) fire and
extended risk insurance for the Building's replacement value and (2) commercial
general liability insurance in an amount of not less than $3,000,000.00. The
cost of all insurance carried by Landlord with respect to the Building shall be
included in Operating Costs. The foregoing insurance policies and any other
insurance carried by Landlord shall be for the sole benefit of Landlord and
under Landlord's sole control, and Tenant shall have no right or claim to any
proceeds thereof or any other rights thereunder.
(c) NO SUBROGATION. Landlord and Tenant each waives any claim it might
have against the other for any injury to or death of any person or persons or
damage to or theft, destruction, loss, or loss of use of any property (a
"LOSS"), to the extent the same is insured against under any insurance policy
that-covers the Building, the Premises, Landlord's or Tenant's fixtures,
personal property, leasehold improvements, or business, or is required to be
insured against under the terms hereof, REGARDLESS OF WHETHER THE NEGLIGENCE OF
THE OTHER PARTY CAUSED SUCH LOSS. Each party shall cause its insurance carrier
to endorse all applicable policies waiving the carrier's rights of recovery
under subrogation or otherwise against the other parry.
(d) INDEMNITY. Subject to Section 11.(c), Tenant shall defend,
indemnify, and hold harmless Landlord and its representatives and agents from
and against all claims, demands, liabilities, causes of action, suits,
judgments, damages, and expenses (including attorneys' fees) arising from (1)
any Loss arising from any occurrence on the Premises, except to the extent
caused by the negligence or fault of Landlord or its agents, or (2) Tenant's
failure to perform its obligations under this Lease. Subject to Section 11.(c),
Landlord shall defend, indemnify, and hold harmless Tenant and its agents from
and against all claims, demands, liabilities, causes of action, suits,
judgments, and expenses (including attorneys' fees) for any Loss arising from
any occurrence in the Building's common areas, except to the extent caused by
the negligence or fault of Tenant or its agents. The indemnities set forth in
this Section 11.(d) shall survive termination or expiration of this Lease and
shall not terminate or be waived, diminished or affected in any manner by any
abatement or apportionment of Rent under any provision of this Lease. If any
proceeding is filed for which indemnity is required hereunder, the indemnifying
party agrees, upon request therefor, to defend the indemnified party in such
proceeding at its sole cost utilizing counsel satisfactory to the indemnified
party.
12. SUBORDINATION; ATTORNMENT: NOTICE TO LANDLORD'S MORTGAGEE.
(a) SUBORDINATION. This Lease shall be subordinate to any deed of
trust, mortgage, or other security instrument (each, a "MORTGAGE"), or any
ground lease, master lease, or primary lease (each, a "PRIMARY LEASE"), that now
or hereafter covers all or any part of the Premises (the mortgagee under any
such Mortgage, beneficiary under any such deed of trust, or the lessor under any
such Primary Lease is referred to herein as a "LANDLORD'S MORTGAGEE"). Any
Landlord's Mortgagee may elect, at any time, unilaterally, to make this Lease
superior to its Mortgage, Primary Lease, or other interest in the Premises by so
notifying Tenant in writing. The provisions of this Section shall be
self-operative and no further instrument of subordination shall be required;
however, in confirmation of such subordination, Tenant shall execute and return
to Landlord (or such other party designated by Landlord) within ten days after
written request therefor such documentation, in recordable form if required, as
a Landlord's Mortgagee may reasonably request to evidence the subordination of
this Lease to such Landlord's Mortgagee's Mortgage or Primary Lease (including a
subordination, non-disturbance and attornment agreement) or, if the Landlord's
Mortgagee so elects, the subordination of such Landlord's Mortgagee's Mortgage
or Primary Lease to this Lease.
12
(b) ATTORNMENT. Tenant shall attorn to any party succeeding to
Landlord's interest in the Premises, whether by purchase, foreclosure, deed in
lieu of foreclosure, power of sale, termination of lease, or otherwise, upon
such party's request, and shall execute such agreements confirming such
attornment as such party may reasonably request.
(c) NOTICE TO LANDLORD'S MORTGAGEE. Tenant shall not seek to enforce
any remedy it may have for any default on the part of Landlord without first
giving written notice by certified mail, return receipt requested, specifying
the default in reasonable detail, to any Landlord's Mortgagee whose address has
been given to Tenant, and affording such Landlord's Mortgagee a reasonable
opportunity to perform Landlord's obligations hereunder.
(d) LANDLORD'S MORTGAGEE'S PROTECTION PROVISIONS. If Landlord's
Mortgagee shall succeed to the interest of Landlord under this Lease, Landlord's
Mortgagee shall not be: (1) liable for any act or omission of any prior lessor
(including Landlord); (2) bound by any rent or additional rent or advance rent
which Tenant might have paid for more than the current month to any prior lessor
(including Landlord), and all such rent shall remain due and owing,
notwithstanding such advance payment; (3) bound by any security or advance
rental deposit made by Tenant which is not delivered or paid over to Landlord's
Mortgagee and with respect to which Tenant shall look solely to Landlord for
refund or reimbursement; (4) bound by any termination, amendment or modification
of this Lease made without Landlord's Mortgagee's consent and written approval,
except for those terminations, amendments and modifications permitted to be made
by Landlord without Landlord's Mortgagee's consent pursuant to the terms of the
loan documents between Landlord and Landlord's Mortgagee; (5) subject to the
defenses which Tenant might have against any prior lessor (including Landlord);
and (6) subject to the offsets which Tenant might have against any prior lessor
(including Landlord) except for those offset rights which (A) are expressly
provided in this Lease, (B) relate to periods of time following the acquisition
of the Building by Landlord's Mortgagee, and (C) Tenant has provided written
notice to Landlord's Mortgagee and provided Landlord's Mortgagee a reasonable
opportunity to cure the event giving rise to such offset event. Landlord's
Mortgagee shall have no liability or responsibility under or pursuant to the
terms of this Lease or otherwise after it ceases to own an interest in the
Building. Nothing in this Lease shall be construed to require Landlord's
Mortgagee to see to the application of the proceeds of any loan, and Tenant's
agreements set forth herein shall not be impaired on account of any modification
of the documents evidencing and securing any loan.
13. RULES AND REGULATIONS. Tenant shall comply with the rules and
regulations of the Building which are attached hereto as Exhibit C. Landlord
may, from time to time, change such rules and regulations for the safety, care,
or cleanliness of the Building and related facilities, provided that such
changes are applicable to all tenants of the Building, will not unreasonably
interfere with Tenant's use of the Premises and are enforced by Landlord in a
non-discriminatory manner. Tenant shall be responsible for the compliance with
such rules and regulations by each Tenant Party.
14. CONDEMNATION.
(a) TOTAL TAKING. If the entire Building or Premises are taken by
right of eminent domain or conveyed in lieu thereof (a "TAKING"), this Lease
shall terminate as of the date of the Taking.
(b) PARTIAL TAKING - TENANT'S RIGHTS. If any part of the Building
becomes subject to a Taking and such Taking will prevent Tenant from conducting
its business in the Premises in a manner reasonably comparable to that conducted
immediately before such Taking for a period of more than 180 days, then Tenant
may terminate this Lease as of the date of such Taking by giving written notice
to Landlord within 30 days after the Taking, and Basic Rent and Additional Rent
shall be apportioned as of the
13
date of such Taking. If Tenant does not terminate this Lease, then Rent shall be
abated on a reasonable basis as to that portion of the Premises rendered
untenantable by the Taking.
(c) PARTIAL TAKING - LANDLORD'S RIGHTS. If any material portion, but
less than all, of the Building becomes subject to a Taking, or if Landlord is
required to pay any of the proceeds arising from a Taking to a Landlord's
Mortgagee, then Landlord may terminate this Lease by delivering written notice
thereof to Tenant within 30 days after such Taking, and Basic Rent and
Additional Rent shall be apportioned as of the date of such Taking. If Landlord
does not so terminate this Lease, then this Lease will continue, but if any
portion of the Premises has been taken, Rent shall xxxxx as provided in the last
sentence of Section 14.(b).
(d) AWARD. If any Taking occurs, then Landlord shall receive the
entire award or other compensation for the Land, the Building, and other
improvements taken; however, Tenant may separately pursue a claim (to the extent
it will not reduce Landlord's award) against the condemnor for the value of
Tenant's personal property which Tenant is entitled to remove under this Lease,
moving costs, loss of business, and other claims it may have.
15. FIRE OR OTHER CASUALTY.
(a) REPAIR ESTIMATE. If the Premises or the Building are damaged by
fire or other casualty (a "CASUALTY"), Landlord shall, within 90 days after such
Casualty, deliver to Tenant a good faith estimate (the "DAMAGE NOTICE") of the
time needed to repair the damage caused by such Casualty.
(b) TENANT'S RIGHTS. If a material portion of the Premises is damaged
by Casualty such that Tenant is prevented from conducting its business in the
Premises in a manner reasonably comparable to that conducted immediately before
such Casualty and Landlord estimates that the damage caused thereby cannot be
repaired within 270 days after the Casualty (the "REPAIR PERIOD"), then Tenant
may terminate this Lease by delivering written notice to Landlord of its
election to terminate within 30 days after the Damage Notice has been delivered
to Tenant.
(c) LANDLORD'S RIGHTS. If a Casualty damages the Premises or a
material portion of the Building and (1) Landlord estimates that the damage to
the Premises cannot be repaired within the Repair Period, (2) the damage to the
Premises exceeds 50% of the replacement cost thereof (excluding foundations and
footings), as estimated by Landlord, and such damage occurs during the last two
years of the Term, (3) regardless of the extent of damage to the Premises,
Landlord makes a good faith determination that restoring the Building would be
uneconomical, or (4) Landlord is required to pay any insurance proceeds arising
out of the Casualty to a Landlord's Mortgagee, then Landlord may terminate this
Lease by giving written notice of its election to terminate within 30 days after
the Damage Notice has been delivered to Tenant.
(d) REPAIR OBLIGATION. If neither party elects to terminate this Lease
following a Casualty, then Landlord shall, within a reasonable time after such
Casualty, begin to repair the Premises and shall proceed with reasonable
diligence to restore the Premises to substantially the same condition as they
existed immediately before such Casualty; however, Landlord shall only be
required to reconstruct the Premises to the extent of any improvements existing
therein on the date of the damage that were installed by Landlord as part of the
Work (if any) pursuant to Exhibit D ("LANDLORD'S CONTRIBUTION"), and Landlord's
obligation to repair or restore the Premises shall be limited to the extent of
the insurance proceeds actually received by Landlord for the Casualty in
question. Tenant shall be responsible for repairing or replacing its furniture,
equipment, fixtures, alterations and other improvements which Landlord is not
obligated to restore, and shall use the proceeds of its insurance for such
purpose. Tenant shall pay the difference
14
between the total cost of reconstructing the Premises and Landlord's
Contribution ("TENANT'S CONTRIBUTION"). Prior to Landlord's commencement of
reconstruction, Tenant shall place Landlord's estimate of Tenant's Contribution
in escrow with Landlord (or furnish Landlord other commercially reasonable
assurances of payment thereof)
(e) ABATEMENT OF RENT. If the Premises are damaged by Casualty, Rent
for the portion of the Premises rendered untenantable by the damage shall be
abated on a reasonable basis from the date of damage until the completion of
Landlord's repairs (or until the date of termination of this Lease by Landlord
or Tenant as provided above, as the case may be), unless a Tenant Party caused
such damage, in which case, Tenant shall continue to pay Rent without abatement.
16. PERSONAL PROPERTY TAXES. Tenant shall be liable for all taxes levied or
assessed against personal property, furniture, or fixtures placed by Tenant in
the Premises. If any taxes for which Tenant is liable are levied or assessed
against Landlord or Landlord's property and Landlord elects to pay the same, or
if the assessed value of Landlord's property is increased by inclusion of such
personal property, furniture or fixtures and Landlord elects to pay the taxes
based on such increase, then Tenant shall pay to Landlord, within 30 days
following written request, the part of such taxes for which Tenant is primarily
liable hereunder; however, Landlord shall not pay such amount if Tenant notifies
Landlord that it will contest the validity or amount of such taxes before
Landlord makes such payment, and thereafter diligently proceeds with such
contest in accordance with Law and if the non-payment thereof does not pose a
threat of loss or seizure of the Building or interest of Landlord therein or
impose any fee or penalty against Landlord.
17. EVENTS OF DEFAULT. Each of the following occurrences shall be an "EVENT
OF DEFAULT":
(a) PAYMENT DEFAULT. Tenant's failure to pay Rent within 5 days after
Landlord has delivered written notice to Tenant that the same is due; however,
an Event of Default shall occur hereunder without any obligation of Landlord to
give any notice if Tenant fails to pay Rent when due and, during the 12 month
interval preceding such failure, Landlord has given Tenant written notice of
failure to pay Rent on one or more occasions;
(b) ABANDONMENT. Tenant (1) abandons or vacates the Premises or any
substantial portion thereof or (2) fails to continuously operate its business in
the Premises;
(c) ESTOPPEL. Tenant fails to provide any estoppel certificate after
Landlord's written request there for pursuant to Section 25.(e) and such failure
shall continue for 5 days after Landlord's second written notice thereof to
Tenant;
(d) OTHER DEFAULTS. Tenant's failure to perform, comply with, or
observe any other agreement or obligation of Tenant under this Lease and the
continuance of such failure for a period of more than 30 days after Landlord has
delivered to Tenant written notice thereof;
(e) INSOLVENCY. The filing of a petition by or against Tenant (the
term "TENANT" shall include, for the purpose of this Section 17.(e), any
guarantor of Tenant's obligations hereunder) (1) in any bankruptcy or other
insolvency proceeding; (2) seeking any relief under any state or federal debtor
relief law; (3) for the appointment of a liquidator or receiver for all or
substantially all of Tenant's property or for Tenant's interest in this Lease;
or (4) for the reorganization or modification of Tenant's capital structure;
however, if such a petition is filed against Tenant, then such filing shall not
be an Event of Default unless Tenant fails to have the proceedings initiated by
such petition dismissed within 90 days after the filing thereof; and
15
(f) ADDITIONAL SECURITY DEPOSIT. Tenant's failure to pay the
Additional Security Deposit within 5 days after Landlord has delivered written
notice to Tenant that the same is due.
18. REMEDIES. Upon any Event of Default, Landlord may, in addition to all
other rights and remedies afforded Landlord hereunder or by law or equity, take
any one or more of the following actions:
(a) TERMINATION OF LEASE. Terminate this Lease by giving Tenant
written notice thereof, in which event Tenant shall pay to Landlord the sum of
(1) all Rent accrued hereunder through the date of termination, (2) all amounts
due under Section 19.(a), and (3) an amount equal to (A) the total Rent that
Tenant would have been required to pay for the remainder of the Term plus
Landlord's estimate of aggregate expenses of reletting the Premises, minus
(B) the then present fair rental rate value of the Premises for such period;
(b) TERMINATION OF POSSESSION. Terminate Tenant's right to possess the
Premises without terminating this Lease by giving written notice thereof to
Tenant, in which event Tenant shall pay to Landlord (1) all Rent and other
amounts accrued hereunder to the date of termination of possession, (2) all
amounts due from time to time under Section 19.(a), and (3) all Rent and other
net sums required hereunder to be paid by Tenant during the remainder of the
Term, diminished by any net sums thereafter received by Landlord through
reletting the Premises during such period, after deducting all costs incurred by
Landlord in reletting the Premises. If Landlord elects to proceed under this
Section 18.(b), Landlord may remove all of Tenant's property from the Premises
and store the same in a public warehouse or elsewhere at the cost of, and for
the account of, Tenant, without becoming liable for any loss or damage which may
be occasioned thereby. Landlord shall use reasonable efforts to relet the
Premises on such terms as Landlord in its sole discretion may determine
(including a term different from the Term, rental concessions, and alterations
to, and improvement of, the Premises); however, Landlord shall not be obligated
to relet the Premises before leasing other portions of the Building. Landlord
shall not be liable for, nor shall Tenant's obligations hereunder be diminished
because of, Landlord's failure to relet the Premises or to collect rent due for
such reletting. Tenant shall not be entitled to the excess of any consideration
obtained by reletting over the Rent due hereunder. Reentry by Landlord in the
Premises shall not affect Tenant's obligations hereunder for the unexpired Term;
rather, Landlord may, from time to time, bring an action against Tenant to
collect amounts due by Tenant, without the necessity of Landlord's waiting until
the expiration of the Term. Unless Landlord delivers written notice to Tenant
expressly stating that it has elected to terminate this Lease, all actions taken
by Landlord to dispossess or exclude Tenant from the Premises shall be deemed to
be taken under this Section 18.(b). If Landlord elects to proceed under this
Section 18.(b), it may at any time elect to terminate this Lease under Section
18.(a); or
(c) ALTERATION OF LOCKS. Additionally, with or without notice, and to
the extent permitted by Law, Landlord may alter locks or other security devices
at the Premises to deprive Tenant of access thereto, and Landlord shall not be
required to provide a new key or right of access to Tenant.
Any and all remedies set forth in this Lease: (i) shall be in addition to
any and all other remedies Landlord may have at law or in equity; (ii) shall be
cumulative; and (iii) may be pursued successively or concurrently as Landlord
may elect. The exercise of any remedy by Landlord shall not be deemed an
election of remedies or preclude Landlord from exercising any other remedies in
the future. Notwithstanding the foregoing, Landlord shall only recover its
damages allowed hereunder once.
19. PAYMENT BY TENANT; NON-WAIVER; CUMULATIVE REMEDIES.
(a) PAYMENT BY TENANT. Upon any Event of Default, Tenant shall pay to
Landlord all costs incurred by Landlord (including court costs and reasonable
attorneys' fees and expenses) in
16
(1) obtaining possession of the Premises, (2) removing and storing Tenant's or
any other occupant's property, (3) repairing, restoring, altering, remodeling,
or otherwise putting the Premises into condition acceptable to a new tenant, (4)
if Tenant is dispossessed of the Premises and this Lease is not terminated,
reletting all or any part of the Premises (including brokerage commissions,
cost of tenant finish work, and other costs incidental to such reletting), (5)
performing Tenant's obligations which Tenant failed to perform, and (6)
enforcing, or advising Landlord of, its rights, remedies, and recourses arising
out of the Event of Default. To the full extent permitted by law, Landlord and
Tenant agree the federal and state courts of the state in which the Premises are
located shall have exclusive jurisdiction over any matter relating to or arising
from this Lease and the parties' rights and obligations under this Lease.
(b) NO WAIVER. Landlord's acceptance of Rent following an Event of
Default shall not waive Landlord's rights regarding such Event of Default. No
waiver by Landlord of any violation or breach of any of the terms contained
herein shall waive Landlord's rights regarding any future violation of such
term. Landlord's acceptance of any partial payment of Rent shall not waive
Landlord's rights with regard to the remaining portion of the Rent that is due,
regardless of any endorsement or other statement on any instrument delivered in
payment of Rent or any writing delivered in connection therewith; accordingly,
Landlord's acceptance of a partial payment of Rent shall not constitute an
accord and satisfaction of the full amount of the Rent that is due.
(c) CUMULATIVE REMEDIES. Any and all remedies set forth in this Lease:
(1) shall be in addition to any and all other remedies Landlord may have at law
or in equity, (2) shall be cumulative, and (3) may be pursued successively or
concurrently as Landlord may elect. The exercise of any remedy by Landlord shall
not be deemed an election of remedies or preclude Landlord from exercising any
other remedies in the future.
20. LANDLORD'S LIEN. In addition to any statutory landlord's lien, now or
hereafter enacted, Tenant grants to Landlord, to secure performance of Tenant's
obligations hereunder, a security interest in all goods (including equipment
and inventory), fixtures, and other personal property of Tenant situated on the
Premises, and all proceeds thereof (the "COLLATERAL"), and the Collateral shall
not be removed from the Premises without the prior written consent of Landlord
(other than in Tenant's ordinary course of business) until all obligations of
Tenant have been fully performed. Upon the occurrence of an Event of Default,
Landlord may, in addition to all other remedies, without notice or demand except
as provided below, exercise the rights afforded to a secured parry under the
Uniform Commercial Code of the state in which the Premises are located (the
"UCC"). To the extent the UCC requires Landlord to give to Tenant notice of any
act or event and such notice cannot be validly waived before a default occurs,
then five-days' prior written notice thereof shall be reasonable notice of the
act or event. Tenant grants to Landlord a power of attorney to execute and file
any financing statement or other instrument necessary to perfect Landlord's
security interest under this Section 20, which power is coupled with an interest
and is irrevocable during the Term. Landlord may also file a copy of this Lease
as a financing statement to perfect its security interest in the Collateral.
Within ten days following written request therefor, Tenant shall execute
financing statements to be filed of record to perfect Landlord's security
interest in the Collateral.
21. SURRENDER OF PREMISES. No act by Landlord shall be deemed an acceptance
of a surrender of the Premises, and no agreement to accept a surrender of the
Premises shall be valid unless it is in writing and signed by Landlord. At the
expiration or termination of this Lease, Tenant shall deliver to Landlord the
Premises with all improvements located therein in good repair and condition,
free of Hazardous Materials placed on the Premises during the Term, broom-clean,
reasonable wear and tear (and condemnation and Casualty damage not caused by
Tenant, as to which Sections 14 and 15 shall control) excepted, and shall
deliver to Landlord all keys to the Premises. Provided that Tenant has performed
all of its obligations hereunder, Tenant may remove all unattached trade
fixtures, furniture, and personal property placed in the
17
Premises or elsewhere in the Building by Tenant (but Tenant may not remove any
such item which was paid for, in whole or in part, by Landlord or any wiring or
cabling unless Landlord requires such removal). Additionally, at Landlord's
option. Tenant shall remove such alterations, additions, improvements, trade
fixtures, personal property, equipment, wiring, cabling, and furniture as
Landlord may request; however, Tenant shall not be required to remove any
addition or improvement to the Premises if Landlord has specifically agreed in
writing that the improvement or addition in question need not be removed. Tenant
shall repair all damage caused by such removal. All items not so removed shall,
at Landlord's option, be deemed to have been abandoned by Tenant and may be
appropriated, sold, stored, destroyed, or otherwise disposed of by Landlord
without notice to Tenant and without any obligation to account for such items;
any such disposition shall not be considered a strict foreclosure or other
exercise of Landlord's rights in respect of the security interest granted under
Section 20. The provisions of this Section 21 shall survive the end of the Term.
22. HOLDING OVER. If Tenant fails to vacate the Premises at the end of the
Term, then Tenant shall be a tenant at sufferance and, in addition to all other
damages and remedies to which Landlord may be entitled for such holding over,
(a) Tenant shall pay, in addition to the other Rent, Basic Rent equal to the
greater of (1) 150% of the Basic Rent payable during the last month of the Term,
or (2) 125% of the prevailing rental rate in the Building for similar space, and
(b) Tenant shall otherwise continue to be subject to all of Tenant's obligations
under this Lease. The provisions of this Section 22 shall not be deemed to limit
or constitute a waiver of any other rights or remedies of Landlord provided
herein or at law. If Tenant fails to surrender the Premises upon the termination
or expiration of this Lease, in addition to any other liabilities to Landlord
accruing therefrom, Tenant shall protect, defend, indemnify and hold Landlord
harmless from all loss, costs (including reasonable attorneys' fees) and
liability resulting from such failure, including any claims made by any
succeeding tenant founded upon such failure to surrender, and any lost profits
to Landlord resulting therefrom.
23. CERTAIN RIGHTS RESERVED BY LANDLORD. Provided that the exercise of such
rights does not unreasonably interfere with Tenant's occupancy of the Premises,
Landlord shall have the following rights:
(a) BUILDING OPERATIONS. To decorate, and to make inspections,
repairs, alterations, additions, changes, or improvements, whether structural or
otherwise, in and about the Building, or any part thereof; to enter upon the
Premises (after giving Tenant reasonable notice thereof, which may be oral
notice, except in cases of real or apparent emergency, in which case no notice
shall be required) and, during the continuance of any such work, to temporarily
close doors, entryways, public space, and corridors in the Building; to
interrupt or temporarily suspend Building services and facilities; to change the
name of the Building; and to change the arrangement and location of entrances or
passageways, doors, and doorways, corridors, elevators, stairs, restrooms, or
other public parts of the Building;
(b) SECURITY. To take such reasonable measures as Landlord deems
advisable for the security of the Building and its occupants; evacuating the
Building for cause, suspected cause, or for drill purposes; temporarily denying
access to the Building; and closing the Building after normal business hours and
on Sundays and holidays, subject, however, to Tenant's right to enter when the
Building is closed after normal business hours under such reasonable regulations
as Landlord may prescribe from time to time;
(c) PROSPECTIVE PURCHASERS AND LENDERS. To enter the Premises at all
reasonable hours to show the Premises to prospective purchasers or lenders; and
(d) PROSPECTIVE TENANTS. At any time during the last 12 months of the
Term (or earlier if Tenant has notified Landlord in writing that it does not
desire to renew the Term) or at any time following the occurrence of an Event of
Default, to enter the Premises at all reasonable hours to show the
18
Premises to prospective tenants.
24. [INTENTIONALLY OMITTED].
25. MISCELLANEOUS.
(a) LANDLORD TRANSFER. Landlord may transfer any portion of the
Building and any of its rights under this Lease. If Landlord assigns its rights
under this Lease, then Landlord shall thereby be released from any further
obligations hereunder arising after the date of transfer, provided that the
assignee assumes Landlord's obligations hereunder in writing.
(b) LANDLORD'S LIABILITY. The liability of Landlord (and its partners,
shareholders or members) to Tenant (or any person or entity claiming by, through
or under Tenant) for any default by Landlord under the terms of this Lease or
any matter relating to or arising out of the occupancy or use of the Premises
and/or other areas of the Building shall be limited to Tenant's actual direct,
but not consequential, damages therefor and shall be recoverable only from the
interest of Landlord in the Building, and Landlord (and its partners,
shareholders or members) shall not be personally liable for any deficiency.
(c) FORCE MAJEURE. Other than for Tenant's obligations under this
Lease that can be performed by the payment of money (e.g., payment of Rent and
maintenance of insurance), whenever a period of time is herein prescribed for
action to be taken by either party hereto, such party shall not be liable or
responsible for, and there shall be excluded from the computation of any such
period of time, any delays due to strikes, riots, acts of God, shortages of
labor or materials, war, governmental laws, regulations, or restrictions, or any
other causes of any kind whatsoever which are beyond the control of such
party.
(d) BROKERAGE. Neither Landlord nor Tenant has dealt with any broker
or agent in connection with the negotiation or execution of this Lease, other
than Xxxxxxxx Xxxx Company and CB Xxxxxxx Xxxxx/Whittier Partners L.P., whose
commission shall be paid by Landlord pursuant to a separate written agreement.
Tenant and Landlord shall each indemnify the other against all costs, expenses,
attorneys' fees, liens and other liability for commissions or other compensation
claimed by any broker or agent claiming the same by, through, or under the
indemnifying party.
(e) ESTOPPEL CERTIFICATES. From time to time, Tenant shall furnish to
any party designated by Landlord, within 10 days after Landlord has made a
request therefor, a certificate signed by Tenant confirming and containing such
factual certifications and representations as to this Lease as Landlord may
reasonably request. Unless otherwise required by Landlord's Mortgagee or a
prospective purchaser or mortgagee of the Building, the initial form of estoppel
certificate to be signed by Tenant is attached hereto as Exhibit F.
(f) NOTICES. All notices and other communications given pursuant to
this Lease shall be in writing and shall be (1) mailed by first class, United
States Mail, postage prepaid, certified, with return receipt requested, and
addressed to the parties hereto at the address specified in the Basic Lease
Information, (2) hand delivered to the intended address, (3) sent by a
nationally recognized overnight courier service, or (4) sent by facsimile
transmission during normal business hours followed by a confirmatory letter sent
in another manner permitted hereunder. All notices shall be effective upon
delivery to the address of the addressee. The parties hereto may change their
addresses by giving notice thereof to the other in conformity with this
provision.
(g) SEPARABILITY. If any clause or provision of this Lease is illegal,
invalid, or unenforceable under present or future laws, then the remainder of
this Lease shall not be affected thereby
19
and in lieu of such clause or provision, there shall be added as a part of this
Lease a clause or provision as similar in terms to such illegal, invalid, or
unenforceable clause or provision as may be possible and be legal, valid, and
enforceable.
(h) AMENDMENTS; AND BINDING EFFECT. This Lease may not be amended
except by instrument in writing signed by Landlord and Tenant. No provision of
this Lease shall be deemed to have been waived by Landlord unless such waiver is
in writing signed by Landlord, and no custom or practice which may evolve
between the parties in the administration of the terms hereof shall waive or
diminish the right of Landlord to insist upon the performance by Tenant in
strict accordance with the terms hereof. The terms and conditions contained in
this Lease shall inure to the benefit of and be binding upon the parties hereto,
and upon their respective successors in interest and legal representatives,
except as otherwise herein expressly provided. This Lease is for the sole
benefit of Landlord and Tenant, and, other than Landlord's Mortgagee, no third
party shall be deemed a third party beneficiary hereof.
(i) QUIET ENJOYMENT. Provided Tenant has performed all of its
obligations hereunder, Tenant shall peaceably and quietly hold and enjoy the
Premises for the Term, without hindrance from Landlord or any party claiming by,
through, or under Landlord, but not otherwise, subject to the terms and
conditions of this Lease.
(j) NO MERGER. There shall be no merger of the leasehold estate hereby
created with the fee estate in the Premises or any part thereof if the same
person acquires or holds, directly or indirectly, this Lease or any interest in
this Lease and the fee estate in the leasehold Premises or any interest in such
fee estate.
(k) NO OFFER. The submission of this Lease to Tenant shall not be
construed as an offer, and Tenant shall not have any rights under this Lease
unless Landlord executes a copy of this Lease and delivers it to Tenant.
(l) ENTIRE AGREEMENT. This Lease constitutes the entire agreement
between Landlord and Tenant regarding the subject matter hereof and supersedes
all oral statements and prior writings relating thereto. Except for those set
forth in this Lease, no representations, warranties, or agreements have been
made by Landlord or Tenant to the other with respect to this Lease or the
obligations of Landlord or Tenant in connection therewith. The normal rule of
construction that any ambiguities be resolved against the drafting party shall
not apply to the interpretation of this Lease or any exhibits or amendments
hereto.
(m) WAIVER OF JURY TRIAL. To the maximum extent permitted by law,
Landlord and Tenant each waive right to trial by jury in any litigation arising
out of or with respect to this Lease.
(n) GOVERNING LAW. This Lease shall be governed by and construed in
accordance with the laws of the state in which the Premises are located.
(o) RECORDING. Tenant shall not record this Lease without the prior
written consent of Landlord, which consent may be withheld or denied in the sole
and absolute discretion of Landlord.
(p) JOINT AND SEVERAL LIABILITY. If Tenant is comprised of more than
one party, each such party shall be jointly and severally liable for Tenant's
obligations under this Lease. All unperformed obligations of Tenant at the end
of the Term shall survive.
(q) FINANCIAL REPORTS. Within 15 days after Landlord's request, Tenant
will furnish Tenant's most recent audited financial statements (including any
notes to them) to Landlord, or, if no such
20
audited statements have been prepared, such other financial statements (and
notes to them) as may have been prepared by an independent certified public
accountant or, failing those, Tenant's internally prepared financial statements.
If Tenant is a publicly traded corporation, Tenant may satisfy its obligations
hereunder by providing to Landlord Tenant's most recent annual and quarterly
reports. Tenant will discuss its financial statements with Landlord and,
following the occurrence of an Event of Default hereunder, will give Landlord
access to Tenant's books and records in order to enable Landlord to verify the
financial statements. Landlord will not disclose any aspect of Tenant's
financial statements that Tenant designates to Landlord as confidential except
(1) to Landlord's Mortgagee or prospective mortgagees or purchasers of the
Building, (2) in litigation between Landlord and Tenant, and (3) if required by
court order. Tenant shall not be required to deliver the financial statements
required under this Section 25.(q) more than once in any 12-month period unless
requested by Landlord's Mortgagee or a prospective buyer or lender of the
Building or an Event of Default occurs.
(r) LANDLORD'S FEES. Whenever Tenant requests Landlord to take any
action not required of it hereunder or give any consent required or permitted
under this Lease, Tenant will reimburse Landlord for Landlord's reasonable,
out-of-pocket costs payable to third parties and incurred by Landlord in
reviewing the proposed action or consent, including reasonable attorneys',
engineers' or architects' fees, within 30 days after Landlord's delivery to
Tenant of a statement of such costs. Tenant will be obligated to make such
reimbursement without regard to whether Landlord consents to any such proposed
action.
(s) TELECOMMUNICATIONS. Tenant and its telecommunications companies,
including local exchange telecommunications companies and alternative access
vendor services companies, shall have no right of access to and within the
Building, for the installation and operation of telecommunications systems,
including voice, video, data, Internet, and any other services provided over
wire, fiber optic, microwave, wireless, and any other transmission systems
("TELECOMMUNICATIONS SERVICES"), for part or all of Tenant's telecommunications
within the Building and from the Building to any other location without
Landlord's prior written consent. All providers of Telecommunications Services
shall be required to comply with the rules and regulations of the Building,
applicable Laws and Landlord's policies and practices for the Building. Tenant
acknowledges that Landlord shall not be required to provide or arrange for any
Telecommunications Services and that Landlord shall have no liability to any
Tenant Party in connection with the installation, operation or maintenance of
Telecommunications Services or any equipment or facilities relating thereto.
Tenant, at its cost and for its own account, shall be solely responsible for
obtaining all Telecommunications Services. However, nothing in this Section
25.(s) shall prohibit Tenant's employees from accessing areas solely within the
Premises that do not contain any equipment serving other tenants of the Building
or the Building's Systems.
(t) CONFIDENTIALITY. Tenant acknowledges that the terms and conditions
of this Lease are to remain confidential for Landlord's benefit, and may not be
disclosed by Tenant to anyone, by any manner or means, directly or indirectly,
without Landlord's prior written consent. The consent by Landlord to any
disclosures shall not be deemed to be a waiver on the part of Landlord of any
prohibition against any future disclosure.
(u) AUTHORITY. Tenant (if a corporation, partnership or other business
entity) hereby represents and warrants to Landlord that Tenant is a duly formed
and existing entity qualified to do business in the state in which the Premises
are located, that Tenant has full right and authority to execute and deliver
this Lease, and that each person signing on behalf of Tenant is authorized to do
so. Landlord hereby represents and warrants to Tenant that Landlord is a duly
formed and existing entity qualified to do business in the state in which the
Premises are located, that Landlord has full right and authority to execute and
deliver this Lease, and that each person signing on behalf of Landlord is
authorized to do so.
21
(v) HAZARDOUS MATERIALS. The term "HAZARDOUS MATERIALS" means any
substance, material, or waste which is now or hereafter classified or considered
to be hazardous, toxic, or dangerous under any Law relating to pollution or the
protection or regulation of human health, natural resources or the environment,
or poses or threatens to pose a hazard to the health or safety of persons on the
Premises or in the Building. Tenant shall not use, generate, store, or dispose
of, or permit the use, generation, storage or disposal of Hazardous Materials on
or about the Premises or the Building except in a manner and quantity necessary
for the ordinary performance of Tenant's business, and then in compliance with
all Laws. If Tenant breaches its obligations under this Section 25.(v), Landlord
may immediately take any and all action reasonably appropriate to remedy the
same, including taking all appropriate action to clean up or remediate any
contamination resulting from Tenant's use, generation, storage or disposal of
Hazardous Materials. Tenant shall defend, indemnify, and hold harmless Landlord
and its representatives and agents from and against any and all claims, demands,
liabilities, causes of action, suits, judgments, damages and expenses (including
reasonable attorneys' fees and cost of clean up and remediation) arising from
Tenant's failure to comply with the provisions of this Section 25.(v). This
indemnity provision shall survive termination or expiration of this Lease.
(w) LIST OF EXHIBITS. All exhibits and attachments attached hereto are
incorporated herein by this reference.
Exhibit A - Plan Showing the Premises
Exhibit A-1 - Plan Showing the Additional Premises
Exhibit B - Description of the Land
Exhibit C - Building Rules and Regulations
Exhibit D - Tenant Finish-Work
Exhibit E - Form of Confirmation of Commencement Date Letter
Exhibit F - Form of Tenant Estoppel Certificate
Exhibit G - Parking
Exhibit H - Renewal Option
Exhibit I - Additional Premises
Exhibit J - Form of Letter of Credit
26. OTHER PROVISIONS.
LANDLORD AND TENANT EXPRESSLY DISCLAIM ANY IMPLIED WARRANTY THAT THE PREMISES
ARE SUITABLE FOR TENANTS INTENDED COMMERCIAL PURPOSE, AND TENANTS OBLIGATION TO
PAY RENT HEREUNDER IS NOT DEPENDENT UPON THE CONDITION OF THE PREMISES OR THE
PERFORMANCE BY LANDLORD OF ITS OBLIGATIONS HEREUNDER, AND, EXCEPT AS OTHERWISE
EXPRESSLY PROVIDED HEREIN, TENANT SHALL CONTINUE TO PAY THE RENT, WITHOUT
ABATEMENT, DEMAND, SETOFF OR DEDUCTION, NOTWITHSTANDING ANY BREACH BY LANDLORD
OF ITS DUTIES OR OBLIGATIONS HEREUNDER, WHETHER EXPRESS OR IMPLIED.
IN WITNESS WHEREOF, and in consideration of the mutual entry into this
Lease and for other good and valuable consideration, and intending to be legally
bound, each party hereto has caused this Lease to be duly executed as a
Massachusetts instrument under seal as of the day and year first above written.
22
LANDLORD: W9/TIB REAL ESTATE LIMITED
PARTNERSHIP, a Delaware limited
partnership
By: W9/TIB Gen-Par, Inc., a Delaware
corporation, its general partner
By: /s/ Xxxxxxx X. Xxxxxxx
------------------------------------
Name: Xxxxxxx X. Xxxxxxx
Title: Assistant Vice President
TENANT: ERUNWAY, INC.,
a Delaware corporation
By: /s/ XXXX XXXXXXXXXXX
------------------------------------
Name: XXXX XXXXXXXXXXX
Title: SVP
23
FIRST AMENDMENT TO LEASE
This First Amendment to Lease (this "First Amendment") is hereby entered
into as of the ______ day of November, 2000 by and between W9/TIB REAL ESTATE
LIMITED PARTNERSHIP, a Delaware limited partnership having an address c/o Archon
Group, L.P., 0000 X Xxxxxx, X.X., Xxxxx 000, Xxxxxxxxxx, X.X. 00000
("Landlord"), and ERUNWAY, INC., a Delaware corporation having an address at
0000 Xxxx Xxxx Xxxxx, Xxxxxxxxxxx, Xxxxxxxxxxxxx 00000 ("Tenant").
WHEREAS, Landlord, as landlord, and Tenant, as tenant, entered into that
certain Lease Agreement (the "Lease") dated as of June _______, 2000 by which
Landlord leased to Tenant and Tenant leased from Landlord a portion of the
building (the "Building") located at and numbered 0000 Xxxx Xxxx Xxxxx,
Xxxxxxxxxxx, Xxxxxxxxxxxxx consisting of approximately 10,499 rentable square
feet of floor area on the third floor of the Building, as more particularly
described in the Basic Lease Information (as defined in the Lease) and as shown
cross-hatched on the plan attached to the Lease as Exhibit A (the "Original
Premises").
WHEREAS, the Term (as defined in the Lease) commenced on September 1, 2000
and expires on August 31, 2005.
WHEREAS, pursuant to Exhibit I attached to the Lease, Landlord shall lease
to Tenant and Tenant shall lease from Landlord a portion of the third floor of
the Building consisting of approximately 11,648 rentable square feet of floor
area as shown cross-hatched on the plan attached to the Lease as Exhibit A-l
(the "Additional Premises") commencing on the Additional Premises Commencement
Date (as defined in the Lease).
WHEREAS, Landlord and Tenant have agreed to extend the Term beyond August
31, 2005 to expire on the Expiration Date (as defined below) in accordance with
the terms and provisions of this First Amendment.
WHEREAS, Landlord now desires to lease to Tenant and Tenant now desires to
lease from Landlord additional space on the first floor of the Building in
accordance with the terms and provisions of this First Amendment.
NOW, THEREFORE, in consideration of the premises and the mutual agreements
contained herein and in Lease, Landlord and Tenant hereby agree as follows:
1. The Term is hereby extended so as to expire on the last day of the
sixtieth full calendar month following the later of (i) January 1, 2001 or (ii)
the Additional Premises Commencement Date (the "Expiration Date"). Therefore,
notwithstanding anything in the Lease to the contrary, the "Term" shall be
defined as the period commencing on September 1, 2000 and ending at 5:00 p.m.
local time on the Expiration Date, subject to adjustment and earlier termination
as provided in the Lease or this First Amendment.
2. Landlord hereby leases to Tenant and Tenant hereby leases from Landlord
a portion of the first floor of the Building consisting of approximately 7,848
rentable square feet of floor area, as shown cross-hatched on the plan attached
hereto as Exhibit A and incorporated herein by this reference (the "First
Amendment Premises"), upon the same terms and conditions set forth in the Lease
and this First Amendment for the Original Premises except as otherwise provided
in this First Amendment, for a
term commencing on December 1, 2000 and expiring on the Expiration Date, unless
terminated earlier as provided in the Lease or this First Amendment.
Notwithstanding anything in the Lease to the contrary, for the period from and
including December 1, 2000 to the day prior to the Additional Premises
Commencement Date, the word "Premises", wherever such word appears in the Lease
or this First Amendment, shall mean the Original Premises and the First
Amendment Premises. Notwithstanding anything in the Lease to the contrary,
effective on and after the Additional Premises Commencement Date, the word
"Premises", wherever such word appears in the Lease or this First Amendment,
shall mean, collectively, the Original Premises, the Additional Premises and the
First Amendment Premises.
3. Notwithstanding anything in the Lease, to the contrary, effective on and
after December 1, 2000 through the end of the Term, the Basic Rent due and
payable by Tenant to Landlord under the Lease (as amended by this First
Amendment) for the First Amendment Premises shall be as follows:
Period Monthly Basic Rent 110 160
------ ------------------ -------- -------
December 1, 2000 - December 31, 2002 $18,639.00 15112.13 3526.87
January 1, 2003 - December 31, 2003 $19,293.00 15642.38 3650.62
January 1, 2004 - Expiration Date $19,947.00 16172.63 3774.37
Basic Rent for the First Amendment Premises shall be conditionally abated
during the month of December 2000. Commencing with January 1, 2001, Tenant shall
make Basic Rent payments for the First Amendment Premises as otherwise provided
in the Lease and this First Amendment. Notwithstanding such abatement of Basic
Rent for the First Amendment Premises (a) all other sums due under the Lease or
this First Amendment shall be payable as provided in the Lease, and (b) any
increases in Basic Rent for the First Amendment Premises set forth in the Lease
and this First Amendment shall occur on the dates scheduled therefor.
4. Notwithstanding anything in the Lease to the contrary, effective on and
after September 1, 2005 through the end of the Term, the Basic Rent due and
payable by Tenant to Landlord under the Lease (as amended by this First
Amendment) for the Original Premises and the Additional Premises shall be
$56,290.91 per calendar month.
5. Notwithstanding anything in the Lease, including, without limitation,
the definition of the phrase "Tenant's Proportionate Share" as set forth in the
Basic Lease Information, to the contrary, effective on and after January 1,
2001, Tenant's Proportionate Share shall be 47.48%, which is the percentage
obtained by dividing the rentable square feet in the Premises (29,995) by the
rentable square feet in the Building (63,180). Landlord and Tenant stipulate
that the number of rentable square feet in the Original Premises, the Additional
Premises, the First Amendment Premises and the Building as set forth in the
Lease and this First Amendment shall be binding upon them.
6. Tenant's taking possession of the First Amendment Premises shall be
conclusive evidence that the First Amendment Premises were in good order and
satisfactory condition when Tenant took possession thereof. No agreement of
Landlord to alter, remodel, decorate, clean or improve the First Amendment
Premises (or to provide Tenant with any credit or allowance for the same) and no
representation or warranty regarding the condition of the First Amendment
Premises or the suitability of the First Amendment Premises for Tenant's
proposed use thereof, have been made by or on behalf of
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Landlord or relied upon by Tenant in connection with this First Amendment,
except as otherwise provided in Exhibit B attached hereto and incorporated by
this reference.
7. Simultaneously with the execution and delivery of this First Amendment
by Tenant, Tenant shall pay to Landlord $239,364.00, which shall be held by
Landlord to secure Tenant's performance of its obligations under the Lease and
this First Amendment pursuant to the terms and provisions of Section 6 of the
Lease. Therefore, the Basic Lease Information is hereby amended by changing the
amount of the Security Deposit (as defined in the Basic Lease Information) from
"$553,675.00" to "793,039.00".
8. Tenant represents to Landlord that Tenant has not dealt with any brokers
other than Xxxxxxx Xxxx Company and CB Xxxxxxx Xxxxx/Xxxxxxx Partners L.P.
(collectively, the "Brokers") in connection with this First Amendment and that,
insofar as Tenant knows, no other broker negotiated this First Amendment or is
entitled to any commission or fee in connection herewith. Tenant agrees to
indemnify, defend and hold Landlord, its asset manager, its property manager and
their respective employees harmless from and against any claim for a fee or
commission made by any broker, other than the Brokers, claiming to have acted by
or on behalf of Tenant in connection with this First Amendment.
9. Section 4.(b) of the Lease is hereby amended by deleting all of such
Section 4.(b). In addition, all references in the Lease to the phrase
"Electrical Costs" are hereby deleted. Section 7 of the Lease is hereby amended
by adding at the end thereof a new subsection (e) as follows:
10. "To the extent that the Premises are separately metered for
electricity, Tenant shall pay (as hereinafter described) for the use of all
electrical service to the Premises. Tenant shall be billed directly by the
electric utility company and Tenant agrees to pay each xxxx promptly in
accordance with its terms, and upon default in making such payment, Landlord may
pay such charges and collect the same from Tenant. In the event for any reason
Tenant cannot be billed directly, Landlord shall forward each xxxx received with
respect to the Building to Tenant of which Tenant shall pay its proportionate
share (as reasonably determined by Landlord based upon either square footage or
level of use) promptly and in accordance with its terms. If the Premises are not
separately metered for any reason, Tenant shall pay Landlord as further
additional rent, in monthly installments at the time prescribed for monthly
installments of Basic Rent, a pro rata share of the cost of electricity for the
Premises as estimated by Landlord from time to time in Landlord's reasonable
discretion. Initially, the cost estimate by Landlord shall be at the rate of
$1.00 per rentable square foot of the Premises per annum. Landlord may require
the purchase and installation of a meter and/or sub-meter, at Tenant's sole cost
and expense, for the purpose of metering and/or sub-metering Tenant's
consumption of electricity. Tenant shall keep such meter and/or sub-meter
serving the Premises and their related installation equipment in good working
order and repair."
The terms and provisions of this paragraph 9 shall take effect retroactive
to September 1, 2000.
11. Given that the Additional Premises Work has already commenced and is
proceeding, it is assumed herein that the Additional Premises Commencement Date
will occur prior to January 1, 2001. However, if the Additional Premises
Commencement Date occurs after January 1, 2001, then paragraph 5 of this First
Amendment shall be modified to provide that, effective on and after the January
1, 2001 "Tenant's Proportionate Share" shall be 29.04%, and, effective on and
after the Additional Premises Commencement Date, "Tenant Proportionate Share"
shall be 47.48%.
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12. Submission of this First Amendment for examination or signature by
Tenant does not constitute a reservation of space or an option for lease, and
this First Amendment shall not be effective unless and until execution and
delivery thereof by both Landlord and Tenant.
13. In all other respects, Landlord and Tenant hereby reaffirm all of the
covenants, agreements, terms, conditions and other provisions of the Lease
except as modified hereby, and the Lease is hereby incorporated in full herein
by reference. The terms and provisions of this First Amendment shall be
effective as of the date first above written, except as may otherwise be
expressly provided herein.
IN WITNESS WHEREOF, Landlord and Tenant have executed this First Amendment
to Lease as a sealed instrument as of the date first above written.
LANDLORD:
W9/TIB REAL ESTATE LIMITED PARTNERSHIP
By: W9/TIB GEN-PAR, INC.,
its General Partner
By: /s/ Xxxxxxx X. Xxxxxxx
------------------------------------
Name: Xxxxxxx X. Xxxxxxx
Title: Assistant Vice President
TENANT:
ERUNWAY, INC.
By: /s/ XXXX XXXXXXXXXXX
------------------------------------
Name: XXXX XXXXXXXXXXX
Title: SVP
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SECOND AMENDMENT AND EXTENSION OF LEASE
THIS INSTRUMENT, dated as of December 30, 2003, by and between 2000
Westborough Office Park LLC, a Delaware limited liability company (the
"Landlord") and Virtusa Corporation, a Delaware corporation formerly known as
eRunway, Inc. (the "Tenant") is an amendment and extension of a certain lease by
and between the Landlord and the Tenant.
Reference is made to the following facts:
A. W9/TIB Real Estate Limited Partnership, a Delaware limited partnership
("W9/TIB") and Tenant entered into a certain lease dated as of June,
2000, as amended by a First Amendment to Lease dated as of November,
2000 (as amended, the "Lease"), with respect to certain space (the
"Premises") in the building at 0000 Xxxx Xxxx Xxxxx, Xxxxxxxxxxx,
Xxxxxxxxxxxxx, containing 29,995 rentable square feet of floor area on
the first and third floors of such building.
B. The Landlord is the successor-in-interest to W9/TIB under the Lease.
C. The Term of the Lease, as previously extended, is scheduled to expire
on December 31, 2005.
D. The Landlord and Tenant are wiling to amend and to extend the Lease,
upon the terms and conditions set forth below.
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties agree as follows
(Capitalized terms used but not defined herein shall have the meanings given in
the Lease.):
1. The Term of the Lease is hereby extended until February 28, 2011.
2. The Tenant accepts the Premises in its "as is" condition as of the
date of this Amendment and agrees that all obligations of the Landlord
to perform any construction or other leasehold improvement work in the
Premises have been performed in full.
3. Notwithstanding anything contained in the Lease to the contrary,
effective January 1, 2004 (the "Restructure Date"), the Basic Rent
shall be payable at the following rates (the period from January
1, 2004, through February 28, 2011, is hereinafter referred to as the
"Restructure Term"):
(i) for the period from January 1, 2004, through December 31, 2004:
$614,897.50 per annum ($51,241.46 per month);
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(ii) for the period from January 1, 2005, through December 31, 2005:
$633,344.43 per annum ($52,778.70 per month);
(iii) for the period from January 1, 2006, through December 31, 2006:
$652,344.76 per annum ($54,362.06 per month);
(iv) for the period from January 1, 2007, through December 31, 2007:
$671,915.10 per annum ($55,992.93 per month);
(v) for the period from January 1, 2008, through December 31, 2008:
$692,072.55 per annum ($57,672.71 per month);
(vi) for the period from January 1, 2009, through December 31, 2009:
$712,834.73 per annum ($59,402.89 per month);
(vii) for the period from January 1, 2010, through December 31, 2010:
$734,219.77 per annum ($61,184.98 per month); and
(viii) for the period from January 1, 2011, through February 28, 2011:
$756,246.36 per annum ($63,020.53 per month).
Notwithstanding the foregoing, no Basic Rent shall accrue or be
payable for and with respect to the period from January 1, 2006,
through February 28, 2006.
4. The Tenant may elect to extend the term of the Lease for one (1) five
(5) year period (the "Option Term"), by giving the Landlord notice of such
election (the "Election Notice") not earlier than twelve (12) months nor later
than nine (9) months before the expiration of the Restructure Term, provided the
Tenant is not in default on the date such notice is given or on the commencement
date of the Option Term. Such extension shall be upon the same terms, covenants,
and conditions contained in the Lease except that the Tenant shall have no
further right to extend the Term and except that the Basic Rent for the Option
Term shall be at a rate equal to the greater of $756,246.36 per annum or the
fair market rent for the Premises as of the commencement of the Option Term. If
the Landlord and the Tenant are unable to agree in writing on the amount of such
fair market rent by the date that is thirty (30) days after the date of the
Election Notice, then the fair market rent shall be determined as follows: On or
before the date that is forty (40) days after the date of the Election Notice,
the Landlord shall specify in writing the rent (the "Landlord's Rental Rate") at
which the Landlord is willing to lease the Premises for the Option Term and the
Tenant shall specify in writing the rent (the "Tenant's Rental Rate") which the
Tenant is willing to pay for the Option Term, the Landlord and the Tenant shall
each appoint one appraiser. The two appraisers so appointed shall endeavor to
determine the fair market rent. If such appraisers are unable to agree on the
amount of such fair market rent on or before the date that is seventy (70)
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days after the date of the Election Notice, they shall appoint a third appraiser
on or before the date that is eighty (80) days after the date of the Election
Notice. The three appraisers shall stipulate the fair market rent within thirty
(30) days after the appointment of the third appraiser. The fair market rent
shall be the amount agreed upon in writing by any two of the three appraisers
and the fair market rent so determined shall be conclusive on the Landlord and
the Tenant. The total costs of such appraisal shall be split equally between the
parties;
5. Effective as of the date hereof, the Lease shall be amended as
follows:
(a) the paragraph on page (ii) of the basic Lease information
entitled "Landlord's Address" shall be deleted in its entirety
and the following shall be substituted in its place:
"Landlord's For all Notices: With a copy to:
Address: 0000 Xxxxxxxxxxx Office 1900 Westborough Office
Park LLC Park LLC
c/o General Investment & x/x Xxxxxxx Xxxxxxxxxx &
Xxxxxxxxxxx Xx. Xxxxxxxxxxx Xx.
000 Xxxxxxxx Xxx., 000 Xxxxxxxx Xxx.,
Xxxxx 0000 Xxxxx 0000
Xxxxxx, XX 00000 Xxxxxx, XX 00000
ATTN: Portfolio Manager ATTN: Legal Counsel
Telephone: 000-000-0000 Telephone: 000-000-0000
Telecopy: 000-000-0000 Telecopy: 000-000-0000
6. As of the Effective Date, the Lease shall be amended as follows:
(i) in the paragraph of Basic Lease Information entitled "Expense
Stop", delete "calendar year 2000" and insert in its place
"calendar year 2004";
(ii) in the paragraph of Basic Lease Information entitled "Base Tax
Year", delete "the fiscal year ending June 30, 2001" and insert
in its place "Calendar year 2004 (For purposes of calculating the
Taxes for calendar year 2004, such amount shall equal fifty
percent (50%) of the Taxes payable for fiscal year 2004 (i.e.,
July 1, 2003, through June 30, 2004) plus fifty percent (50%) of
the Taxes payable for fiscal year 2005 (i.e., July 1, 2004,
through June 30, 2005);
It is understood that the expenses will be grossed up to reflect a 95%
occupancy of the Building and/or Office Park, as applicable.
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The foregoing changes shall not affect the calculation of additional
rent payable under the Lease for the period prior to the commencement
of the Restructure Term.
(iii) In Section 10(e), delete the first sentence thereof in its
entirety and insert in its place the following:
"Landlord may, within 30 days after submission of Tenant's
written request for Landlord's consent to an assignment or to a
subletting that, collectively with all previous subleases,
results in a subleasing of more than 40% of the rentable floor
area of the Premises, cancel this Lease as to the portion of
Premises proposed to be sublet or assigned as of the date the
proposed Transfer is to be effective."
(iv) In Section 10(f), insert, in the second line thereof, between
"thereof," and "the excess", the following:
"50% of".
(v) In Section 10(c), delete the last sentence thereof in its
entirety.
(vi) In Section 22, delete the first sentence in its entirety and
insert in its place the following:
"If Tenant fails to vacate the Premises at the end of the Term,
then Tenant shall be a tenant at sufferance and, in addition to
all other damages and remedies to which Landlord may be entitled
for such holding over, (a) Tenant shall pay, in addition to the
other Rent, Basic Rent equal to 150% of the Basic Rent payable
during the last month of the Term, (provided, however, that if
such holding over continues for more than sixty (60) days, then
the Basic Rent shall increase to 200% of the Basic Rent payable
during the last month of the Term (b) Tenant shall otherwise
continue to be subject to all of Tenant's obligations under this
Lease."
7. Each party hereto warrants and represents that it has dealt with no real
estate broker or agent other than Xxxxxxxxx and Xxxx LLC and Xxxxxxxx Xxxxx
Xxxxx & Partners (collectively, the "Broker") in connection with this
transaction and agrees to defend, indemnify and save the other party harmless
from and against any and all claims for commissions or fees resulting from a
breach of the warranting party's warranties and representations. Landlord shall
be responsible for any commissions or fees owed to the Broker in connection with
this transaction in accordance with a separate agreement between Broker and
Landlord.
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8. Right of First Offer (a) If at any time prior to January 1, 2008,
Landlord in its sole discretion determines that any separately demised leaseable
area on the first floor of the Building (each such area, a "ROFO Space") has
become "available for leasing" (as hereinafter defined), and provided that the
conditions precedent set forth in Subsection (c) below are then satisfied, then
prior to offering to lease such ROFO Space to any 3rd parties, Landlord shall
deliver notice thereof to Tenant (the "ROFO Notice") setting forth a description
of the ROFO Space in question (including the rentable area thereof), the
Landlord's determination of the Basic Rent and Additional Rent for the ROFO
Space, the other material business terms upon which Landlord is willing to lease
the ROFO Space, and the date Landlord anticipates that the ROFO Space will
become available for leasing (the "ROFO Space Availability Date"). Provided that
all of the conditions precedent set forth in this Section 8 are fully satisfied
by Tenant, Tenant shall have the option (the "ROFO Option"), exercisable by
Tenant delivering written notice (the "Acceptance Notice") to Landlord within
twenty (20) calendar days after delivery by Landlord of the ROFO Notice, to
lease the ROFO Space upon all of the terms and conditions set forth in the ROFO
Notice, including the Annual Fixed Rent, escalation rent, and Additional Rent
for the ROFO Space designated by Landlord as set forth therein. Time shall be of
the essence as to Tenant's giving of the Acceptance Notice with respect to any
ROFO Space. If (a) Tenant fails to deliver an Acceptance Notice within such
twenty (20) day period, or (b) if Tenant timely delivers an Acceptance Notice as
aforesaid but does not execute and deliver a final fully executed amendment to
this Lease with respect to the leasing of the ROFO Space, in form and
substance reasonably satisfactory to Landlord within forty five (45) days after
delivery of the Acceptance Notice, then Tenant shall be deemed to have rejected
the option to lease the applicable ROFO Space (the "Rejected ROFO Space"). In
such event, the Landlord shall be free for one hundred eighty (180) days after
the date of the ROFO Notice to lease the ROFO Space to any party without again
offering such space to the Tenant; provided, however, that if the Landlord
offers the ROFO Space for a rental rate that is less than ninety (90%) percent
of the rate set forth in the ROFO notice, then the Landlord shall first offer
the ROFO Space to the Tenant on such terms. If Landlord does not lease the ROFO
Space during such one hundred eighty (180) day period or if the Landlord
proposes to lease the ROFO Space during such period at a rental rate below
ninety (90%) percent of the effective rate, taking into consideration rental
rate and concessions, set forth in the ROFO Notice, the terms of this Section 8
shall continue to apply to such space.
(b) For purposes of this Section 8, space shall be deemed "available for
leasing" when Landlord has determined in its discretion that (a) the space is
vacant, or (b) the respective existing tenant or occupant will not extend or
renew the term of its lease or other occupancy agreement for the ROFO Space and
that said existing tenant or occupant is not interested either in extending or
renewing its lease or other occupancy agreement for the ROFO Space or in
entering into a new lease for such ROFO Space. For purposes of this Section 8,
space shall not be deemed "available for leasing" if, at the time in question
(a) any person or entity holds any option or right to lease or occupy the ROFO
Space, or to renew its lease or right(s) of occupancy thereof, or any other
rights or claims thereto (including, without limitation, any rights of first
offer, rights of first refusal or
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expansion rights) or (b) Landlord intends to occupy the ROFO Space. Without
limitation, so long as a tenant or other occupant leases or occupies all or a
portion of the ROFO Space, Landlord shall be free to extend or renew any such
tenancy or occupancy, whether or not pursuant to a lease or other agreement, and
such space shall not be deemed to be "available for leasing." In no event shall
Landlord be liable to Tenant for any failure by any then existing tenant or
occupant (the "Hold-Over Tenant") to vacate any ROFO Space by any particular
date. However, if such Hold-Over Tenant continues to occupy such ROFO Space for
120 days after the ROFO Space Availability Date then Tenant may elect to
terminate its agreement to lease the ROFO Space by giving Landlord written
notice of such election at any time after the expiration of such 120-day period
and before Landlord delivers possession of the ROFO Space, in which event
Tenant's election to lease the ROFO Space shall become void on the date that is
thirty (30) days after Tenant gives Landlord such termination notice, unless on
or before the expiration of such 30-day period, Landlord delivers possession of
the ROFO Space to Tenant, in which event such termination shall become void.
Notwithstanding anything herein to the contrary, Tenant's Right of First Offer
pursuant to this Section is subject and subordinate in all respects to the
rights (whether such rights are designated as a right of first offer, right of
first refusal, expansion option or otherwise) of any tenant or occupant of the
Building existing on the date hereof.
(c) Tenant shall have no right to exercise the ROFO Option unless all of
the following conditions have been satisfied both on the date of the Acceptance
Notice and on the ROFO Space Commencement Date (as hereinafter defined): (a) no
default or Event of Default shall exist at the time of the offer, (b) Landlord
shall not have validly given Tenant more than (2) notices of monetary default
under the Lease in the twelve (12) month period immediately preceding to the
Acceptance Notice and (c) the named Tenant herein (i.e. Virtusa Corporation)
shall occupy not less than seventy percent (70%) of the rentable floor area of
the Premises.
(d) Effective as of the date on which Landlord delivers the ROFO Space to
Tenant (the "ROFO Space Commencement Date"):
(i) The ROFO Space shall be added to and be deemed to be a part of the
Premises for all purposes under this Lease (except as otherwise provided in this
Section 8);
(ii) The ROFO Space shall be delivered in broom-clean condition, free
of all tenants and occupants subject to improvement allowance, if any, offered
in the ROFO Notice.
(iii) Basic Rent and Additional Rent (including a Base Year) for the
ROFO Space shall be as set forth in the ROFO Notice; and
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(iv) Tenant shall pay all Additional Rent payable under this Lease
with respect to the applicable ROFO Space, except to the extent that any such
Additional Rent is included in the amounts payable under clause (iii) above.
(e) If Tenant exercises the ROFO Option, upon request made by Landlord,
Tenant will execute, acknowledge and deliver to Landlord an amendment to this
Lease confirming the ROFO Space Commencement Date, the Annual Fixed Rent, the
improvement allowance, if any, escalation rent and Additional Rent payable with
respect to the ROFO Space, the incorporation of the ROFO Space into the
Premises, and the modifications to this Lease resulting therefrom, as provided
in Subsection (d) above. The failure of either party to execute and deliver such
an amendment shall not affect the rights, liabilities or obligations of the
parties with respect to the ROFO Space.
9. Security Deposit Reduction: Notwithstanding any other provision of the
Lease to the contrary, the following provisions shall apply to the Security
Deposit under the lease:
(a) As of the date of this Amendment, the Security Deposit being held by
the Landlord equals $793,039.00. Subject to the following conditions,
on the Effective Date the Security Deposit shall be reduced to
$614,897.50. Such reduction, and any future reductions provided for in
this Section 9, shall, so long as the Security Deposit is in the form
of one or more letters of credit, be accomplished by the Tenant
providing the Landlord with a substitute or replacement letter(s) of
credit in the reduced amount of the security deposit, whereupon the
Landlord shall forthwith return to the Tenant the letter(s) of credit
for the previous amount of the Security Deposit.
The reduction permitted in this Subsection (a) is made on the
condition that at all times from the Effective Date until December 31,
2005, the Tenant shall (i) timely make all payments of Basic Rent and
Additional Rent and (ii) maintain a net worth of at least
$15,000,000.00 and a cash balance of $5,500,000. If either such
condition ceases to the satisfied at any time before December 31,
2005, then, forthwith upon demand therefor by the Landlord, the Tenant
shall deliver to the Landlord an additional Security Deposit in the
amount of $178,141.50 (i.e., $793,039.00 minus $614,897.50). Upon
written request by Landlord, the Tenant shall deliver to the Landlord,
within thirty (30) days after the close of each calendar quarter
through December 31, 2005, a quarterly financial statement for the
Tenant, as certified by the Tenant's Chief Financial Officer, for the
most recently expired calendar quarter, showing the Tenant's financial
condition in reasonable detail, including, without limitation, a
balance sheet which outlines the Tenant's net worth and cash balance
as of the close of such quarter.
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(b) In addition to the reduction provided for in Subsection (a) above, and
regardless of whether such reduction is in effect as of the first
Reduction Date (defined below), if, as of any Reduction Date, as
hereinafter defined, (i) there is no uncured Event of Default and (ii)
in the twelve (12) months immediately preceding to the Reduction Date,
Landlord shall not have validly given Tenant two (2) notices of
monetary default under the Lease which monetary defaults remained
uncured for more than thirty (30) days after the applicable notice
(notwithstanding the cure period provided in the Lease, which shall be
unaffected by this Amendment), then the amount of the Security Deposit
shall be reduced to equal the amount set forth below opposite each
Reduction Rate:
Reduction Date Security Deposit
-------------- ----------------
January 1,2006 $489,258.56
January 1,2008 $346,036.28
January 1,2010 $183,554.94
10. The Tenant acknowledges and agrees that the Landlord's agreement to
reduce the Basic Rent payable for the period (the "Rent Reduction Period") from
January 1, 2004, through December 31,2005, is made in consideration of the
Tenant's agreement to extend the Term of the Lease as provided herein and on the
understanding that the Tenant will perform its obligations hereunder and under
the Lease as amended hereby. Accordingly, the Tenant agrees that throughout the
Rent Reduction Period, Basic Rent shall continue to accrue at the rates set
forth in the Lease without taking into account this Amendment (the "Previous
Rate"), provided that Basic Rent shall be payable at the rates set forth herein.
The amount, as of any date, by which the accrued Basic Rent (i.e., at the
Previous Rate) for the Rent Reduction Period exceeds the Basic Rent payable
hereunder (i.e., at the rates set forth in this Amendment) is hereinafter
referred to as the "Deferred Basic Rent". If before December 31,2005, (i) an
Event of Default occurs pursuant to Section 17 (a) the Lease which Event of
Default continues for more than twenty (20) days, i.e. thirty (30) days after
the giving of notice with respect to such default (notwithstanding the cure
period provided in the Lease, which shall be unaffected by this Amendment) or
(ii) an Event of Default occurs pursuant to Section 17(e) of the Lease (unless,
notwithstanding the occurrence of such Event of Default, Tenant continues to
make all required payments and performs all of its other obligations under the
Lease through December 31, 2005), then in the event that the Landlord terminates
the Lease or takes possession of the Premises under Section 18(b) of the Lease
as a result of such Event of Default, in addition to such damages as may be
payable under Article 19 of the Lease, (i) the Tenant shall also be liable to
Landlord in damages for the amount of the Deferred Basic Rent, as of the date of
such termination or taking of possession and (ii) for the balance of the Rent
Reduction Period, Basic Rent shall be payable at the Previous Rate for the
purposes of calculating the Landlord's damages on account of such Event of
Default. If no Event of Default has occurred by January 1,2006, then this
Section 11 shall automatically become void and of no further effect.
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11. Tenant acknowledges that the rate currently charged by Landlord for
after-hour HVAC services is $35.00 per hours and that the rate currently
charged by Landlord for electric service is $1.25 per square foot per annum.
Nothing contained herein shall affect Landlord's right to adjust such charges
from time to time as provided in the Lease.
12. Except as expressly amended hereby, the Lease shall remain in full
force and effect.
WITNESS the execution hereof under seal as of the date first set forth
above.
LANDLORD:
2000 WESTBOROUGH OFFICE PARK LLC,
a Delaware limited liability company
By: Windsor Realty Fund IV-2002 L.P.,
its sole member and manager
By: Windsor Advisory IV LLC,
its general partner
By: Windsor Investment Company, Inc.,
its sole member and manager
By: /s/ Xxxxxx X. Xxxxxxxxxx, Xx.
------------------------------------
Name: Xxxxxx X. Xxxxxxxxxx, Xx.
Title: Clerk
TENANT:
VITUSA CORPORATION
By: /s/ Xxxx X. Xxxxx
------------------------------------
Name: Xxxx X. Xxxxx
Title: Corporate Counsel
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