SECOND AMENDMENT TO LEASE
This SECOND AMENDMENT TO LEASE is made by and between Xxxxx X. Xxxx and
Xxxxx X. Xxxx, Trustees of Fort Washington Realty Trust under Declaration of
Trust dated June 19, 1995 and recorded with the Middlesex County (South
District) Registry of Deeds in Book 25422, Page 360 (the "Landlord") and
Vertex Pharmaceuticals Incorporated (the "Tenant").
Reference is hereby made to that certain lease (the "Lease") dated March
3, 1995, by and between Landlord's predecessor, Fort Washington Limited
Partnership and Tenant with respect to a portion of the property (the
"Premises") located at 00 Xxxx Xxxxxx, Xxxxxxxxx, Xxxxxxxxxxxxx, (the
"Building") as more particularly described in the Lease as amended by a First
Amendment to Lease (the "First Amendment").
WHEREAS, the Tenant has requested, and the Landlord has agreed, to
further amend the Lease to add additional space to the Premises upon the
terms and conditions set forth in this Second Amendment to Lease.
WHEREAS, Landlord and Tenant desire to amend and modify the terms of the
Lease to incorporate the additional space and to ratify and confirm the terms
of the Lease as amended by the First Amendment as more particularly set forth
below.
NOW, THEREFORE, in consideration of the mutual promises herein
contained, and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, Landlord and Tenant agree as
follows:
1. Upon occupancy by Tenant, the definition of the Premises set forth
in the Lease shall be amended to include the addition of 41,132,
r.s.f. of space (the "Additional Space") in the Building currently
leased to Millennium Pharmaceuticals, Inc. ("Millennium"). See
Exhibit A annexed hereto for the layout of the Additional Space.
2. Tenant shall take occupancy of the Additional Space beginning on the
later of (I) the date upon which Millennium vacates the Additional
Space, or (ii) March 19, 1999, and continuing for a period of ten
(10) years from the date upon which Tenant occupies the Additional
Space (the "Additional Space Term"). On or after March 19, 1999, if
necessary, Landlord shall use best efforts to expedite
Millennium's departure from the Additional Space, including filing
an eviction proceeding. Landlord warrants and represents that
according to the terms of its lease with Millennium that the lease
expires on March 18, 1999 as to the Premises and the associated
parking spaces. As to the Premises and the associated parking
spaces, Landlord hereby agrees that Landlord will not extend or
renew the term of Millennium's lease or waive any failure by
Millennium to vacate. Landlord shall not be held liable for any
loss or damage incurred by Tenant as a result of hold-over by
Millennium. Landlord represents that in addition to other sums for
holding over, Millennium must pay a holdover premium equal to the
greater of (a) twice the then fair market rent as reasonably
determined by Landlord, or (b) the total of the Fixed Rent,
Additional
Rent (as those terms are defined in the Millennium lease) and all other
payments then payable under the Millennium lease. Landlord agrees that it
shall not waive the payment to Landlord of any such holdover premium by
Millennium.
Provided that Tenant has exercised in each instance its options to
extend the Lease Term for the original Premises: (a) Tenant shall have two
(2) options to extend the Additional Space Term (the "Additional Space
Options") for successive periods of five (5) years each (the "Additional
Space Extension Periods"), subject to and on the terms set forth herein.
Tenant may only exercise the Additional Space Options with respect to the
entire Additional Space. If Tenant shall desire to exercise any Additional
Space Option, it shall give Landlord a notice (the "Additional Space Inquiry
Notice") of such desire not later than fifteen (15) months prior to the
expiration of the Additional Space Term of this Lease or the preceding
Additional Space Extension Period, as the case may be. Thereafter, the Fair
Market Rent (as defined in Subsection (c) below) for the applicable
Additional Space Extension Period shall be determined in accordance with
Subsection (d) below. After the applicable Fair Market Rent has been so
determined, Tenant shall exercise each Additional Space Option by giving
Landlord notice (the "Additional Space Exercise Notice") of its election to
do so not later than twelve (12) months prior to the expiration of the
Additional Space Term of this Lease, or the preceding Additional Space
Extension Period, as the case may be. If Tenant fails to timely give either
the Additional Space Inquiry Notice or the Additional Space Exercise Notice
to Landlord with respect to any Additional Space Option, Tenant shall be
conclusively deemed to have waived such Additional Space Option hereunder.
(b) Notwithstanding any contrary provision of this Lease, each
Additional Space Option and any exercise by Tenant thereof shall be void and of
no force or effect unless on the dates Tenant gives Landlord its Additional
Space Inquiry Notice and Additional Space Exercise Notice for each Additional
Space Option and on the date of commencement of each Additional Space Extension
Period (i) this Lease is in full force and effect, (ii) there is no Event of
Default of Tenant under this Lease, and (iii) Tenant has not assigned or
subleased (or agreed to assign or sublease) more than fifty percent (50%) of the
rentable floor area then comprising the Additional Space.
(c) All of the terms, provisions, covenants, and conditions of this
Lease shall continue to apply during each Additional Space Extension Period,
except that the Additional Space Annual Fixed Rent Rate during each Additional
Space Extension Period (the "Extension Rent") shall be equal to the fair market
rent for the Additional Space determined as of the date twelve (12) months prior
to expiration of the Additional Space Term or the preceding Additional Space
Extension Period, as the case may be, in accordance with the procedure set forth
in Subsection (d) below (the "Fair Market Rent").
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(d) The Fair Market Rent for each Additional Space Extension Period
shall be determined as follows: Within five (5) days after Tenant gives Landlord
its Additional Space Inquiry Notice with respect to any Additional Space Option,
Landlord shall give Tenant notice of Landlord's determination of the Fair Market
Rent for the applicable Additional Space Extension Period. Within ten (10) days
after Tenant receives such notice, Tenant shall notify Landlord of its agreement
with or objection to Landlord's determination of the Fair Market Rent, whereupon
the Fair Market Rent shall be determined by arbitration conducted in the manner
set forth below. If Tenant does not notify Landlord within such ten (10) day
period of Tenant's agreement with or objection to Landlord's determination of
the Fair Market Rent, then the Fair Market Rent for the applicable Additional
Space Extension Period shall be deemed to be Landlord's determination of the
Fair Market Rent as set forth in the notice from Landlord described in this
subsection.
(e) If Tenant notifies Landlord of Tenant's objection to Landlord's
determination of Fair Market Rent under the preceding subsection, such notice
shall also set forth a request for arbitration and Tenant's appointment of a
commercial real estate broker having at least ten (10) years experience in the
commercial leasing market in the City of Cambridge, Massachusetts (an
"Arbitrator"). Within five (5) days thereafter, Landlord shall by notice to
Tenant appoint a second Arbitrator. Each Arbitrator shall be advised to
determine the Fair Market Rent for the applicable Additional Space Extension
Period within thirty (30) days after Landlord's appointment of the second
Arbitrator. On or before the expiration of such thirty (30) day period, the two
Arbitrators shall confer to compare their respective determinations of the Fair
Market Rent. If the difference between the amounts so determined by the two
Arbitrators is less than or equal to ten percent (10%) of the lower of said
amounts then the final determination of the Fair Market Rent shall be equal to
the average of said amounts. If such difference between said amounts is greater
than ten percent (10%), then the two arbitrators within ten (10) days thereafter
shall appoint a third Arbitrator (the "Third Arbitrator"), who shall be
instructed to determine the Fair Market Rent for the applicable Additional Space
Extension Period within ten (10) days after his appointment by selecting one of
the amounts determined by the other two Arbitrators. Each party shall bear the
cost of the Arbitrator selected by such party. The cost for the Third
Arbitrator, if any, shall be shared equally by Landlord and Tenant.
3. Tenant shall accept the Additional Space in "as is" condition.
Tenant acknowledges that Landlord has made, in anticipation of
Tenant's future occupancy, for the benefit of Tenant at Landlord's
sole cost and expense, certain improvements to the Additional Space
as outlined in Exhibit B. Landlord agrees to consult with Tenant
prior to agreeing to any changes requested by Millennium to the
Additional Space.
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4. Upon execution of this Second Amendment to Lease, section 4.1(d) of
the Lease will be stricken in its entirety and be null and void and
of no further force and effect.
5. Upon occupancy by Tenant of the Additional Space, Tenant shall pay
to Landlord Annual Fixed Rent for the Additional Space in the
amount of $1,460,186.00 (the "Additional Space Annual Fixed Rent
Rate"), payable in equal monthly installments of $121,682.17 in
advance on the first day of each calendar month; and for any
portion of a calendar month at the beginning or end of the Term, at
that rate payable in advance for such portion.
6. Article 4.1(b) shall be renumbered as 4.l(b)(l) and the following
shall be added to the Lease as Article 4.1(b)(2):
(b) (2) Adjustment for CPI - Additional Space. (a) On December 31,
2000 (the "First Adjustment Date"), the Additional Space
Annual Fixed Rent Rate shall be increased by multiplying
said rate by the lesser of (i) a fraction, the numerator
of which shall be the Price Index (as hereinafter
defined) most recently established prior to the First
Adjustment Date, and the denominator of which shall be
the Base Price Index (as hereinafter defined), or (ii)
one hundred four percent (104%) per year, compounded
annually over the period of time beginning April 1, 1997
through the First Adjustment Date. (b) On December 31,
2005 (the "Second Adjustment Date"), the Additional Space
Annual Fixed Rent Rate (as adjusted) shall be increased
by multiplying said rate by the lesser of (i) a fraction,
the numerator of which shall be the Price Index (as
hereinafter defined) most recently established prior to
the Second Adjustment Date, and the denominator of which
shall be the Base Price Index (as hereinafter defined),
or (ii) one hundred four percent (104%) per year,
compounded annually over the five (5) years of the
Additional Space Term of this Lease. As used herein, the
term "Price Index" shall mean and refer to the "Consumer
Price Index for Urban Wage Earners and Clerical Workers,
for the Boston, Massachusetts area, All Items (1982-84 =
100)" published by the Bureau of Labor Statistics of the
United States Department of Labor or successor or
substitute index appropriately adjusted, and the term
"Base Price Index" shall mean and refer to the Price
Index most recently established prior to the Commencement
Date. In the event the Price Index (or a successor or
substitute index) shall not be published for the City of
Boston, Massachusetts area or for the months indicated
above, the corresponding index for the United States City
Average (and if this is not available, a reliable
governmental or other nonpartisan publication evaluating
similar or equivalent information as used in the Price
Index) shall be used. In the event the Price Index ceases
to use the 1982-84 average of
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100 as the basis of calculation, or if a substantial
change is made in the terms or numbers of items contained
in the Price Index, then the Price Index shall be
adjusted to the figure that would have been arrived at
had the manner of computing the Price Index in effect at
the date of this Lease not been changed.
7. Upon commencement of the Additional Space Term, the Tenant's
Proportionate Fraction as set forth in the Lease will be
amended to 100%.
8. The provisions of Paragraph 10.11 of the Lease shall include
reference to the Additional Space Annual Fixed Rent Rate
in determining the "Security Deposit Amount" as the same
may be adjusted. Upon commencement of the Additional
Space Term, the Tenant shall increase the Security
Deposit Amount by an amount equal to one (1) year
Additional Space Annual Fixed Rent plus additional
amounts, if any, as set forth in paragraph 10.11 as
amended. The Security Deposit Amount shall be adjusted as
provided in Section 10.11 by including the Additional
Space Annual Fixed Rent Rate and other rental amounts due
with respect to the Additional Space, as the same may be
adjusted in accordance with Section 4.1(b), Section
4.1(c), Section 10.12, Section 10.13 and Section 10.14 of
the Lease as amended. The additional Security Deposit
Amount may be in the form of a Letter of Credit in the
form of Exhibit L to the Lease and must be delivered on
the commencement of the Additional Space Term.
9. Upon tenant's reasonable request and subject to availability on
the lot upon which the Building is situated, Landlord
shall provide additional surface parking spaces to Tenant
on a tenancy-at-will basis for an additional charge of
$75.00 per space per month.
10. Landlord acknowledges that Tenant presently intends to
reconfigure the Additional Space upon taking occupancy.
The process for such reconfiguration of the Additional Space
shall be in accordance with paragraph 3.3 of the Lease.
However, Tenant shall be under no obligation to reconfigure the
Additional Space.
11. Exhibit I of the Lease is hereby replaced with Exhibit "I"
attached hereto.
All capitalized terms used herein shall have the same meaning as set
forth in the Lease.
Except as otherwise expressly set forth herein, all other terms of the
Lease shall apply to the Additional Space, are hereby ratified and confirmed and
shall remain unchanged and in full force and effect.
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Executed this 13th day of June, 1997.
LANDLORD
By: /S
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Xxxxx X. Xxxx, Trustee as aforesaid and not individually
By: /S
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Xxxxx X. Xxxx, Trustee as aforesaid and not individually
TENANT:
VERTEX PHARMACEUTICALS INCORPORATED
By:
-----------------------------------------------------
Name:
Title:
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Executed this 13th day of June, 1997.
LANDLORD
By:
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Xxxxx X. Xxxx, Trustee as aforesaid and not individually
By:
-----------------------------------------------------
Xxxxx X. Xxxx, Trustee as aforesaid and not individually
TENANT:
VERTEX PHARMACEUTICALS INCORPORATED
By: /s/
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Name: Xxxxxxx X. Xxxxxxx
Title: Senior Vice President
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EXHIBIT A
TENANT AREA TWO EQUALS ADDITIONAL SPACE
[Drawings Follow]
EXHIBIT B
PLAN ENTITLED MILLENNIUM PHARMACEUTICAL INC.
FORT WASHINGTON RESEARCH CENTER
00 XXXX XXXXXX, XXXXXXXXX, XX 00000
INCORPORATING BASE BUILDING RENOVATIONS
STAGE II & MILLENNIUM TENANT FIT-OUT
FINAL GMP/CONSTRUCTION SET ISSUED 1/7/97
EXHIBIT I
SECOND FLOOR ADDITION PLAN
[DRAWING FOLLOWS]
This OPTION AGREEMENT is entered into this l2th day of June, 1997, by
and between Xxxxx X. Xxxx and Xxxxx X. Xxxx, Trustees of Fort Washington Realty
Trust under Declaration of Trust dated June 19, 1995, and recorded in the
Middlesex South District Registry of Deeds in Book 25422, Page 360 (the "Owner")
with an address c/o of Lyme Timber Company, On the Common, X.X. Xxx 000, Xxxx,
Xxx Xxxxxxxxx 00000, and Vertex Pharmaceuticals Incorporated ("Vertex") with an
address of 00 Xxxx Xxxxxx, Xxxxxxxxx, Xxxxxxxxxxxxx 00000.
WHEREAS, Owner intends to construct a parking garage (the "Garage")
upon its property located at 00 Xxxx Xxxxxx, Xxxxxxxxx, Xxxxxxxxxxxxx.
WHEREAS, Vertex is (i) currently a tenant in the building owned by
Owner located at and known as 00 Xxxx Xxxxxx, Xxxxxxxxx, Xxxxxxxxxxxxx under a
lease dated March 3, 1995, as amended (the "Lease") and (ii) the future Tenant
at 00 Xxxx Xxxxxx, Xxxxxxxxx, Xxxxxxxxxxxxx, of Additional Space as that term is
defined in a Second Amendment to Lease of even date herewith between Owner and
Vertex.
WHEREAS, Vertex has requested and Owner is willing to grant an option
to Vertex to lease fifty (50) enclosed parking spaces (the "Spaces") in the
Garage subject to the terms and conditions set forth herein.
NOW, THEREFORE, for good and valuable consideration, the receipt and
adequacy of which are hereby acknowledged, Owner and Vertex agree as follows:
1. Commencing on the date of this Option Agreement and expiring on the
commencement of the Additional Space Term (the "Option Period"), and provided
Vertex is not in default under the Lease, Vertex shall have an option (the
"Option") to lease the Spaces from Owner or its successor in interest.
2. Vertex may exercise the Option at any time during the Option Period
by giving written notice to Owner or its successor at the address set forth
above.
3. Within a reasonable period of time after Owner is in receipt of
Vertex's notice of exercise of the Option, Owner shall notify Vertex of the
monthly rental (the "Rent") to be charged for the Spaces, which monthly rental
may include a schedule of incremental rental increases not to exceed one
increase per year of the Parking Space Term as hereinafter defined, which shall
be at Fair Market Rate as determined by Owner.
(a) Within ten (10) days after Vertex receives notice of the
Fair Market Rate to be charged for the Spaces from Owner, Vertex shall notify
Owner of its agreement with or objection to Owner's determination of the Fair
Market Rate, whereupon the Fair
Market Rate shall be determined by arbitration conducted in the manner set forth
below. If Vertex does not notify Owner within such ten (10) day period of
Vertex's agreement with or objection to Owner's determination of the Fair Market
Rate, then the Fair Market Rate for the Spaces shall be deemed to be Owner's
determination of the Fair Market Rate as set forth in the notice from Owner
described in this subsection.
(b) If Vertex notifies Owner of Vertex's objection to Owner's
determination of Fair Market Rate under the preceding subsection, such notice
shall also set forth a request for arbitration and Vertex's appointment of a
commercial real estate broker having at least ten (10) years' experience in the
commercial leasing market in the City of Cambridge, Massachusetts (an
"Arbitrator"). Within five (5) days thereafter, Owner shall by notice to Vertex
appoint a second Arbitrator. Each Arbitrator shall be instructed to determine
the Fair Market Rate for the applicable Additional Space Extension Period within
thirty (30) days after Owner's appointment of the second Arbitrator. On or
before the expiration of such thirty (30) day period, the two Arbitrators shall
confer to compare their respective determinations of the Fair Market Rate. If
the difference between the amounts so determined by the two Arbitrators is less
than or equal to ten percent (10%) of the lower of said amounts then the final
determination of the Fair Market Rate shall be equal to the average of said
amounts. If such difference between said amounts is greater than ten percent
(10%), then the two arbitrators within ten (10) days thereafter shall appoint a
third Arbitrator (the "Third Arbitrator"), who shall be instructed to determine
the Fair Market Rate for the applicable Additional Space Extension Period within
ten (10) days after his appointment by selecting one of the amounts determined
by the other two Arbitrators. Each party shall bear the cost of the Arbitrator
selected by such party. The cost for the Third Arbitrator, if any, shall be
shared equally by Owner and Vertex.
4. Occupancy of the Spaces and the payment of the Rent shall commence
no later than the commencement of the Additional Space Term and shall continue
until the expiration of the term of the Lease (as may be extended in accordance
with the terms of the Lease), for Vertex's Additional Space at 00 Xxxx Xxxxxx as
defined the Lease (the "Parking Space Term").
5. The parties agree to memorialize the Commencement Date of the
Parking Space Term.
6. Notwithstanding the foregoing, none of the terms set forth herein or
the existence of this Option Agreement shall create an obligation on the part of
Owner to construct the Garage.
7. Unless otherwise set forth herein, all capitalized terms used herein
shall have the same meaning as set forth in the Lease and Second Amendment to
Lease referred to herein.
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Executed as of the date first above written.
FORT WASHINGTON REALTY TRUST
/S
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By: Xxxxx X. Xxxx, Trustee aforesaid and not individually
/S
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By: Xxxxx X. Xxxx, Trustee as aforesaid and not individually
VERTEX PHARMACEUTICALS INCORPORATED
BY
Name:
Title:
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Executed as of the date first above written.
FORT WASHINGTON REALTY TRUST
By:
Xxxxx X. Xxxx, Trustee as aforesaid and not individually
By:
Xxxxx X. Xxxx, Trustee as aforesaid and not individually
VERTEX PHARMACEUTICALS INCORPORATED
By: /S
----------------------------------------------------------
Name: Xxxxxxx X. Xxxxxxx
Title: Senior Vice President
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