Exhibit 10.11
THIS LEASE AGREEMENT (this "Lease") made as of this 16th day of June 2004,
by and between EIGHT FIFTY CANAL, LLC, a limited liability company organized and
existing under the laws of the State of Connecticut, with its principal offices
at c/o Xxxxx Xxxxxxx & Sons, Inc., 000 Xxxxx Xxxxxx in the City of Stamford,
County of Fairfield and State of Connecticut, acting herein by Xxxxx Xxxxxx
Xxxxxxx, its manager, hereunto duly authorized, which limited liability company
is hereinafter referred to as "Landlord," and MTM TECHNOLOGIES, INC., a
corporation organized and existing under the laws of the State of New York,
acting herein by Xxxxxxx X. Xxxxxx, its Chief Executive Officer, hereinafter
referred to as "Tenant."
WITNESSETH:
SECTION 1 - DEMISED PREMISES:
Landlord hereby leases to Tenant and Tenant hereby hires approximately (i)
Six Thousand (6,452) rentable square feet of office space (the "Original Space")
on the third floor in a building (the "Building") located on real property (the
"Land") located at 000 Xxxxx Xxxxxx, Xxxxxxxx Xxxxxxxxxxx, which Original Space
is shown on Exhibit "A" annexed hereto and which Land is shown on Exhibit "B"
annexed hereto, and (ii) when such space is vacated by its current tenant
(estimated to be within one (1) year of the Original Space Rent Commencement
Date (defined below)), the approximately Two Thousand Four Hundred and Sixty
Eight (2,468) rentable square feet of office space adjacent to the Original
Space (the "Additional Space, and with the Original Space, the "Demised
Premises"). Landlord hereby warrants and represents that such rentable areas
accurately reflects a "loss factor" (i.e., the percentage difference between the
rentable area and usable area of the Demised Premises) which does not exceed 19
percent and that Tenant's Proportionate Share (defined below) accurately
reflects the fraction obtained by dividing the rentable square footage of the
Demised Premises by the rentable square footage of the Building. If Landlord has
overstated the rentable area of the Demised Premises or Tenant's Proportionate
Share, upon Tenant's request, this Lease shall be appropriately amended and
Tenant's rent shall be retroactively adjusted to reflect such overstatement,
with Landlord reimbursing Tenant for any overpayments made before said
adjustment. For the purposes of convenience, unless otherwise indicated the term
"Demised Premises" shall be deemed to apply solely to the Original Space during
the period in which Tenant occupies solely the Original Space; after Tenant
occupies both the Original Space and the Additional Space, it shall be deemed to
apply to both the Original Space and the Additional Space. In addition, Landlord
shall, and hereby does, grant to Tenant, and Tenant shall, and hereby does,
accept from Landlord, the non-exclusive right to use the Common Areas during the
Term for itself, its employees, other agents and guests in common with Landlord,
any tenants of other leased premises within the Building and any of their
respective employees, other agents and guests. "Common Areas" means all areas
and facilities at the Land intended for the common use of all tenants of the
Building, including, without limiting the generality of the foregoing, the
parking area and driveways on the Land.
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SECTION 2 - PARKING:
Landlord will provide Tenant, at no extra charge, with three (3) parking
spaces at the Building for each 1,000 rentable square feet of office space
actually occupied from time to time by Tenant, such that until such time as
Tenant occupies the Additional Space, Landlord will provide Tenant with nineteen
(19) parking spaces, and when Tenant occupies the Additional Space, Landlord
will provide Tenant with an additional eight (8) parking spaces for a total of
twenty seven (27) parking spaces. Of said parking spaces, two (2) shall be
marked and reserved for Tenant's exclusive use. Landlord reserves the right to
relocate Tenant's spaces within the same parking area and to change the size of
the spaces at any time during the Term of this Lease. Landlord shall keep the
parking area in good order and repair, reasonably secure, and reasonably free of
obstructions such as ice, snow, rubbish and unauthorized vehicles.
SECTION 3 - TERM OF LEASE
(a) The Term of this Lease shall be for five (5) years, commencing on the
later of September, 1, 2004 or five (5) business days following: Tenant's
receipt from Landlord of a final and unconditional certificate of occupancy for
the Original Space d (the "Original Space Rent Commencement Date") and ending on
the fifth anniversary of the Original Space Rent Commencement Date (the "Term"),
with payment of rent commencing on (i) with respect to the Original Space,
subject to the provisions of Section 4(a)(iii) hereof, the Original Space Rent
Commencement Date, and (ii) with respect to the Additional Space, subject to the
provisions of Section 4(a)(iii) hereof, after the Additional Space is vacated by
its existing tenant and five (5) business days following Tenant's receipt from
Landlord of a final and unconditional certificate of occupancy for the
Additional Space (the "Additional Space Rent Commencement Date", and with the
Original Space Rent Commencement Date, the "Commencement Date"). Notwithstanding
the immediately preceding sentence, Landlord and Tenant agree that the
Additional Space Rent Commencement Date shall not occur before June 1, 2005 or
after the one (1) year anniversary of the Original Space Rent Commencement Date.
(b) (i) If the Original Space is not ready for occupancy in accordance with
the provisions of Section 3(a) and Section 6(a) hereof on September 1, 2004 or
the Additional Space is not ready for occupancy in accordance with the
provisions of Section 3(a) and Section 6(a) hereof by the one (1) year
anniversary of the Original Space Rent Commencement Date, Landlord shall have
the greater of (x) an additional forty five (45) days or (y) such amount in
excess of forty five (45) days as may be necessary under the circumstances to
comply with any change orders in the Work required by Tenant under Section 6(a)
hereof, in which to ready such designated portion of the Demised Premises for
occupancy. If either designated portion of the Demised Premises is not ready for
occupancy on the respective date set forth as such portion's Commencement Date
(and with respect to the Additional Space, on or before the one (1) year
anniversary of the Original Space Rent Commencement Date) and said delay is
proximately caused by any act or omission of Tenant or any of its employees,
agents or contractors, including but not limited to, any change orders in the
Work required by Tenant and/or failure of Tenant to act reasonably promptly when
any consent of approval may be requested by Landlord, Tenant's obligation to pay
rent with respect to such portion
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shall commence nevertheless. Should Landlord fail to deliver the Original Space
or Additional Space to Tenant as required by this Lease for any reason not
caused by Tenant (including, without limitation, any reasons due to "Force
Majeure" conditions) within the aforesaid period, Tenant may terminate this
Lease, without liability, upon ten (10) days' notice, in which case Landlord
shall immediately return to Tenant any prepaid rent.
(c) At the expiration or termination of the Term of this Lease, whether by
lapse of time or otherwise, Tenant shall surrender the Demised Premises in good
condition, reasonable wear and tear, loss or damage by fire, casualties, the
elements, or by causes beyond Tenant's reasonable control, and Landlord's
maintenance, repair and replacement obligations, excepted. At the expiration of
the Term of this Lease, Tenant shall remove from the Demised Premises all
fixtures and furnishings belonging to Tenant (provided, however, that Tenant
shall have no obligation to remove or pay for the removal of the initial fit-up
of the Demised Premises, or any subsequent alterations which Landlord has
approved during the Term), and the Demised Premises shall be left in broom-clean
condition. Tenant shall repair, at its cost, any damage caused by removal of
fixtures or furnishings during or at the end of the Term. At the election of the
Landlord, all partitions, ceilings, lighting appended to the Demised Premises
and flooring or carpeting will become the property of the Landlord unless
fixtures installed by Tenant.
SECTION 4 - RENT
(a) The basic rent for the Demised Premises shall be as follows:
(i) For the Original Space, One Hundred Forty One Thousand Nine
Hundred and Forty Four and 00/100 ($141,944) Dollars per year, or $11,828.67
monthly; and
(ii) For the Additional Space, Fifty Four Thousand Two Hundred and
Ninety Six and 00/100 ($54,296) Dollars per year, or $4,524.67 monthly.
(iii) Notwithstanding the foregoing provisions, Tenant shall not be
obligated to pay any rent during the first three (3) full months it occupies the
Original Space, and during the first full month following the Additional Space
Rent Commencement Date.
(b) The term "Lease Year" as used herein shall mean each period of twelve
(12) consecutive calendar months commencing on the Original Space Rent
Commencement Date and, hereafter, on the anniversary of the Original Space Rent
Commencement Date during the Term of this Lease, and the Renewal Term, if any.
(c) The annual rent shall be paid in twelve (12) equal installments in
advance on the first day of each calendar month during the Term. Tenant shall
pay the prorated monthly portion of said rent for any fractional period of a
month or fractional period of a Lease Year within the Term or Renewal Term, if
any.
SECTION 5 - COVENANTS:
(a) Landlord covenants that as long as Tenant is not in default under this
Lease, Tenant may peaceably and quietly have, hold and enjoy the Demised
Premises, subject to the conditions set forth herein.
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(b) Landlord hereby represents and warrants that it has the full right,
power and authority to execute this Lease and grant the estate herein demised.
(c) Landlord shall have the right, however, to enter the Demised Premises
at all reasonable times, upon reasonable prior notice to the Tenant, during
usual business hours, for the purpose of inspection or for showing the same to
prospective purchasers or fee mortgagees, provided Landlord's entries are in a
manner consistent with Tenant's reasonable security requirements and do not
unreasonably interfere with Tenant's use of the Demised Premises for business
purposes.
SECTION 6 - FIT-UP AND ALTERATIONS:
(a) Prior to the applicable Commencement Date, Landlord, at its expense,
shall undertake and complete to Tenant's reasonable satisfaction all the work
(the "Work") described in Exhibit "A1" attached hereto and made a part hereof
with respect to the Original Space and the Additional Space. The Work shall be
performed promptly and diligently until completion, by supervised, experienced
personnel. The Work shall be performed in a first-class manner as to
workmanship, installation and materials, and in accordance with Tenant's
approved plans. Tenant shall have the right to make change orders to said
approved plans, upon Landlord's prior written consent, which consent shall not
be unreasonably withheld, conditioned or delayed. Landlord shall provide Tenant
with any and all resulting cost increases and/or estimated time delays
associated with said change orders upon approving same. Landlord shall perform
the Work in compliance with all applicable federal, state and local laws, codes,
statutes, ordinances, guidelines, rules and regulations. During the course of
construction, Landlord shall keep Tenant duly apprised of the progress of the
Work and any claimed delays. Landlord hereby warrants and represents that the
Work shall be free from defects in workmanship, installation and materials for a
period of one (1) year from the applicable Commencement Date, and Landlord, at
its sole cost and expense, shall promptly perform any corrective work arising
from said warranty. Within sixty (60) days after the applicable Commencement
Date, Tenant shall have the right to submit to Landlord a "punch list" of any
Work items which need to be finished or corrected, and Landlord, at its sole
cost and expense, shall promptly complete and/or correct same. Landlord, at its
expense, before the Original Space Commencement Date, shall install Tenant's
name on all directories in the Building. Landlord shall modify such listings to
identify any permitted assignees or subtenants, with Tenant reimbursing Landlord
for the actual costs therefor. Tenant shall have the right to install a sign on
its entrance door and reasonably appropriate signage in the Demised Premises,
provided it first obtains Landlord's consent.
(b) (i) Subsequent to the Work to be performed by the Landlord, as outlined
on Exhibit "A1", Tenant shall make no alterations or improvements in or to the
Demised Premises without Landlord's prior written consent. Any such alterations
or improvements shall be performed only by Landlord, or by contractors
reasonably approved by Landlord, provided however, any such approved contractors
must be licensed to do business in the State of Connecticut and must be of
similar size, quality and reputation as Xxxxx Xxxxxxx & Sons, Inc.
Notwithstanding the foregoing, Tenant may decorate, not including painting, and
perform minor cosmetic remodeling with respect
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to the portion of the Demised Premises occupied by Tenant from time to time, in
either case without obtaining Landlord's consent.
(ii) In furtherance of the foregoing provisions, Landlord and Tenant
have discussed, and Landlord is amenable to the installation in the Building or
on the Land (the location of which shall be reasonably determined by Landlord in
its sole discretion) of, a back-up generator of a size and power agreed upon by
the parties that is reasonably necessary to provide back-up power for Tenant's
computers and electronic data processors in the Demised Premises. In all events,
the installation of any such generator shall be subject to the following
conditions: the generator (i) shall not interfere with the peaceful and quiet
enjoyment of the other tenants of the Building, (ii) must be installed in a
manner and in a location which will minimize noise and vibration, be performed
at Tenant's expense and by duly licensed and Landlord-approved contractors, and
(iii) must be serviced under a maintenance contract by a reputable service
provider at Tenant's sole cost and expense throughout the term of the Lease.
(c) Landlord hereby warrants and represents that, as of the applicable
Commencement Date: (a) the Demised Premises shall be vacant, broom-clean and
ready for Tenant's exclusive occupancy; (b) all Work shall be substantially
completed such that a final and unconditional certificate of occupancy
permitting lawful occupancy has been duly issued, and such that Tenant may
reasonably commence its business operations; (c) all mechanical equipment and
utility systems serving the Demised Premises shall be in good working order and
repair; (d) the Demised Premises shall be structurally sound and "water-tight";
(e) Tenant's access to the Demised Premises shall be reasonably secure and
unimpeded; and (f) the Demised Premises, Building and the Land shall be in
compliance with all applicable laws, codes, statutes, ordinances, guidelines,
rules and regulations. Landlord's warranties and representations under this
subsection shall survive the commencement of the Term.
SECTION 7 - ADDITIONAL RENT; ESCALATION:
(a) As used herein:
1. The term "Real Estate Taxes" shall mean all real property related
taxes and assessments levied, assessed, or imposed at any time by any
governmental authority upon or against the Building, parking lot and Land, and
also any tax or assessment levied, assessed, or imposed, newly enacted at any
time by any governmental authority having jurisdiction over the Demised Premises
in connection with the receipt of income or rent from said Building, parking lot
and Land (computed as if Landlord owned or operated no property other than said
Building, parking lot and Land) to the extent that same shall be in lieu of or
in addition to all or a portion of any of the aforesaid real property taxes
against the Building and Land. The term "Real Estate Taxes " shall not mean or
include any interest or penalties which may become due by reason of the failure
to pay any such taxes when due and payable, or any inheritance, estate,
transfer, gift, succession, general franchise, corporate, income, excess
profits, sales, conveyance or other non-real estate tax imposed on Landlord, and
shall exclude any Real Estate Taxes not fairly allocable to the Term.
2. "Tax Year" shall mean a fiscal year for which Real Estate Taxes are
imposed.
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3. "Base Tax Year" is stipulated to be the tax fiscal year of July 1,
2004 to June 30, 2005 of the City of Stamford. The Real Estate Taxes payable in
the Base Tax Year shall be deemed to be the amount derived by multiplying the
full assessment value of the Building, parking lot and Land by the mill rate for
the Base Tax Year. Full assessed value of the Building and Land, in the first
instance, shall be deemed to mean the total assessment for the Building and Land
made by the City Tax Assessor on the Grand List of October 1, 2003; provided
however, until such time as the Building, parking lot and Land are assessed by
the City Tax Assessor as a fully constructed and 90% occupied property, the
assessed value of said items will be equitably adjusted to assume a fully
constructed (including tenant space fit-out) Building that was 90% occupied
during the entire Base Tax Year.
4. "Subsequent Tax Year" shall mean a Tax Year or portion thereof that
falls within the Term of this Lease which shall be subsequent to the Base Tax
Year.
5. "Building" shall mean the Building in which the Demised Premises
are located.
6. "Tenant's Proportionate Share" shall be deemed to be 9.67% of the
Building with respect to the Original Space, including the parking lot and Land.
When Tenant takes occupancy of the Additional Space, Tenant's Proportionate
Share shall be increased by 3.7% for an aggregate total of 13.37%.
(b) If the Real Estate Taxes for any Subsequent Tax Year shall be more than
Real Estate Taxes for the Base Tax Year, Tenant shall pay as additional rent for
such Subsequent Tax Year, a sum equal to Tenant's Proportionate Share of the
amount by which the Real Estate Taxes for such Subsequent Tax Year are greater
than the Real Estate Taxes for the Base Tax Year (which amount is hereinafter
called the "Tax Payment"). In connection therewith, the parties agree that until
such time as the Building is 90% occupied and, therefore, 90% assessed, the Real
Estate Taxes for any Subsequent Tax Year shall be equitably adjusted to the
amount such Real Estate Taxes would have been if the Building was 90% occupied
during each such Subsequent Tax Year. Should this Lease terminate prior to the
expiration of a Subsequent Tax Year, such Tax Payment shall be prorated to, and
shall be payable on, or when ascertained after, the date of termination of this
Lease. Payments of additional rent for Tax Payments due from Tenant shall be
made as and subject to the conditions, hereinafter provided in this Section. If
Landlord shall receive a refund or rebate of Real Estate Taxes for any
Subsequent Tax Year, Landlord shall pay to Tenant, Tenant's Proportionate Share
of such refund and of any interest thereon, after deduction from such refund and
interest the reasonable costs and expenses (including experts' and attorneys'
fees) of obtaining such refund.
(c) Landlord with reasonable promptness after receipt of the xxxx for the
Base Tax Year shall supply Tenant with a copy thereof. If the Real Estate Taxes
for the Base Tax Year shall thereafter be reduced, Landlord shall notify Tenant
with reasonable promptness of the amount of the Real Estate Taxes for the Base
Tax Year as so reduced and provide Tenant with written evidence of such
reduction issued by the taxing authority. With reasonable promptness after the
end of each Subsequent Tax Year, Landlord shall render and deliver to Tenant a
copy of the Real Estate Tax xxxx for such Subsequent Tax Year and a comparative
statement showing the amount of the Real Estate Taxes for the Base Tax Year, the
amount of Real Estate Taxes for such Subsequent Tax Year and the Tax Payment due
from Tenant for such Subsequent Tax Year, indicating thereon in reasonable
detail the computation of such Tax Payment. If the comparative statement for a
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Subsequent Tax Year shows a payment due, Tenant shall pay the amount of the Tax
Payment shown on such comparative statement (or the balance or a proportionate
installment thereon, if only an installment of such Real Estate Taxes is
involved) within thirty (30) days after the rendition and receipt of such
comparative statement.
(d) The following words and phrases, wherever used in this Section 7 shall
have the following meanings:
1. "Base Operating Expense" means the amount of the Operating Expenses
for the Base Year (as hereinafter defined). The parties agree that until the
Building is 90% occupied "Base Operating Expenses" shall be equitably adjusted
by cost item to the amount such expenses would have been if the Building was 90%
occupied during the entire Base Year.
2. "Base Year" means the calendar year 2004.
3. "Subsequent Year" means the Twelve (12) month period immediately
succeeding the Base Year and any further Twelve (12) month period immediately
succeeding a Subsequent Year.
4. "Operating Expenses" means the following expenses of the Landlord
attributable to maintenance of the Land and Building, to the extent that they
are reasonable and properly incurred for the stated purpose and chargeable
against income in accordance with generally accepted accounting principles, and
except to the extent that they have been separately charged to the tenants of
the Building and excluding capital expenses:
(i) The wages of persons (other than any head office employees of the
Landlord) engaged in the current operation and maintenance of the Land and
Building;
(ii) The cost of common area electric (calculated by subtracting the
sum of all monies paid by all tenants of the Building for electricity from the
electricity xxxx for the Building covering the same period of time), water,
fuel, supplies, materials, and equipment required for the current operation and
maintenance of the Building. Landlord represents that each tenant of the
Building is and shall continue to be required to pay for all electricity
consumed within its leased premises outside of Operating Expenses.
(iii) Amounts payable under contracts with contractors reflecting
prevailing rates in the subject industry, with contractors for current operation
and maintenance to the Building, including without limiting the generality of
the foregoing, contracts relating to the elevator, the cleaning of the Building,
security of the Building, and all other services to be provided by Landlord
pursuant to the terms of this Lease;
(iv) Amounts payable for insurance premiums for those insurance
policies purchased by Landlord as required in this Lease.
"Operating Expenses" shall exclude all of the following:
(i) Landlord's debt service (principal and interest) of any kind;
(ii) Any environmental compliance or remediation costs of any kind;
(iii) Intentionally Omitted;
(iv) Any costs, fees or expenses not expressly referred to in this
Lease, or otherwise provided to be paid by parties other than Tenant;
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(v) Wages, salaries, fees and fringe benefits paid to administrative
or executive personnel or officers or partners of Landlord who are not directly
involved in the daily management and operations of the Land;
(vi) All costs, fees and disbursements relating to activities for the
solicitation and execution of leases for space in the Land (including, without
limitation, legal fees and brokerage costs);
(vii) The cost of correcting defects in the construction of the
Building or in the building equipment and mechanical systems thereof;
(viii) The cost of any repair made by Landlord because of the total or
partial destruction of the Building or the condemnation of a portion of the
Building or Land;
(ix) The cost of any items for which Landlord is reimbursed by
insurance or other parties;
(x) The cost of any additions or capital improvements to the Building;
(xi) the cost of any repairs, alterations, additions, replacements,
and other items which under generally accepted accounting principles are
properly classified as capital expenditures to the extent they upgrade or
improve the Building as opposed to the replacement of existing items which have
worn out;
(xii) the cost of any work or service performed for, or facilities
furnished to, any tenant of the Building to a greater extent or in a manner more
favorable to such tenant than the work or services regularly performed for or
furnished to other tenants of the Building;
(xiii) The cost of alterations to, or the decorating or redecorating
of space in the Building leased to other tenants;
(xiv) the cost of overtime or other expense to Landlord in curing its
defaults under this Lease or performing work expressly provided in this Lease to
be borne at Landlord's sole expense;
(xv) Intentionally Omitted; and
(xvi) Any costs representing an amount paid to a corporation, entity
or person related to Landlord which is in excess of the amount which would be
paid in the absence of such relationship.
5. "Wages" means and includes salaries, medical, surgical and general
welfare benefits (including group life insurance), workmen's compensation
insurance, uniforms, and amounts contributed by Landlord to pension funds in
respect of the employees of Landlord referred to in Paragraph 4, but only to the
extent that such salaries, benefits, insurance and/or reasonable contributions
are reasonable having regard to corresponding salaries, benefits, insurance
and/or contributions paid in connection with the operation of similar office
Buildings in Stamford, Connecticut.
6. "Tenant's Proportionate Share" shall be deemed to be 9.67% with
respect to the Original Space. When Tenant takes occupancy of the Additional
Space, Tenant's Proportionate Share shall be increased by 3.7% for an aggregate
total of 13.37%.
(e) In the event that at any time or from time to time during the Term of
this Lease, the amount of Operating Expenses for any Subsequent Year shall be in
excess of the Base Operating Expenses, the Tenant shall pay as additional rent a
sum equal to Tenant's Proportionate Share of the amount by which the Operating
Expenses for such Subsequent Year are greater than the Base
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Operating Expenses; provided, however, that Tenant shall not be liable for any
increases in Operating Expenses which are not fairly allocable to the Term. In
connection therewith, the parties agree that until such time as the Building is
90% occupied, the Operating Expenses for any Subsequent Year shall be equitably
adjusted to the amount such Operating Expenses would have been if the Building
was 90% occupied during each such Subsequent Year. The Landlord shall furnish to
the Tenant as soon as possible after the end of the Base Year and each
Subsequent Year but in any event not later than Four (4) months thereafter, a
certificate of the Landlord specifying the amount of the Base Operating Expenses
and the Operating Expenses for each such year determined as herein provided and
showing in reasonable detail the nature of and the manner of computing such
expenses. Within Thirty (30) days of the receipt of such certificates for each
such year in respect of which amounts (said amount being herein called "Excess
Operating Payments") are payable by the Tenant hereunder, the Tenant shall
reimburse the Landlord all amounts then owing by it in respect of such Excess
Operating Payments.
(e) Notwithstanding anything to the contrary contained herein, Landlord
agrees that during the initial term of this Lease Tenant shall not be charged
for increases in non-fixed Operating Expenses in excess of ten percent (10%) per
year.
(g) Landlord's comparative statement for a Tax Payment and Landlord's
comparative statement of increase in the Operating Expenses over the Base Year
Operating Expenses shall be conclusive and binding upon Tenant unless:
(i) within Sixty (60) days after receipt of either such comparative
statement Tenant shall notify Landlord that it disputes the correctness of the
statement, specifying the respects in which the statement is claimed to be
incorrect, and;
(ii) if such dispute shall not have been settled by agreement, Tenant
shall submit the dispute to binding arbitration within Sixty (60) days after
receipt of such comparative statement. Pending the determination of such dispute
by agreement or arbitration as aforesaid, Tenant shall pay additional rent in
accordance with Landlord's comparative statement, and such payment shall be
without prejudice to Tenant's position. If the dispute shall be determined in
Tenant's favor, Landlord shall forthwith reimburse Tenant for any overpayment.
Notwithstanding the foregoing, Landlord agrees to make available, upon two (2)
business days' notice, its statements, books and records relating to said
dispute for audit, inspection and copying by Tenant.
SECTION 8 - UTILITIES:
Together with monthly payments of base rent due hereunder, Tenant shall pay
for all electricity used in the portion of the Demised Premises, including
electricity used and consumed for lighting, and/or other small business office
equipment and machines at the current rate of $1.75 per rentable square foot per
Lease Year, which rate has been established based on the electricity rate
charged to Landlord by the public utility, Northeast Utilities Company. Tenant
shall pay for any rate increase imposed by the public utility during the Term of
this Lease. If any additional or large office equipment requiring in excess of
15 amperes is employed by Tenant during the term of this Lease or any extension
thereof, the rates and amounts payable by the Tenant each Lease Year shall be
established by means of a survey conducted by the public utility at Landlord's
expense. Landlord shall not in any way be liable or responsible to Tenant for
any loss or damage or expense which
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Tenant may sustain of incur if the quantity or character of electric service is
changed by the public utility or through no fault of Landlord is no longer
available or suitable for Tenant's requirements. Tenant's electricity charges
shall not exceed the normal and customary electricity charges imposed at
comparable first-class office buildings in the Stamford, Connecticut area.
SECTION 9 - USE AND OPERATION OF DEMISED PREMISES:
(a) Throughout the Term of this Lease, Tenant may use the Demised Premises
for general office purposes and to operate a computer network operations center
and any lawful uses reasonably related thereto. Landlord hereby warrants and
represents that, to the best of its knowledge, information and belief,
applicable zoning and the Building's certificate of occupancy permit the
foregoing usage at the Demised Premises. Landlord shall not unreasonably
withhold, condition or delay its consent to uses at the Demised Premises other
than those specified above, provided such other uses are generally in keeping
with the standards of the Building and (X) do not (i) injure or damage the
Demised Premises or the Property, (ii) cause any offensive odors, noises or
visual effects, (iii) constitute a public or private nuisance or menace to any
patron, tenant or other persons or their property, (iv) constitute or be
reasonably viewed by Landlord or the community at any time and from time to time
as vulgar, lewd, lascivious or catering to prurient interests or be in any way
detrimental to the reputation of Landlord or its principals, (v) make void or
voidable any insurance with respect to the Property and/or the Demised Premises,
or which will make it impossible to obtain fire or other insurance at the usual
rate for similar structures, (Y) will not cause or be likely to cause structural
damage to the Building or any part thereof, and (Z) will not violate any law or
regulation of any governmental authority, and are otherwise allowed by
applicable law, zoning regulations and the underwriting requirements of
Landlord's insurer(s) of the Building and the requirements of any holder of any
mortgage encumbering the Land and the Building.
(b) Tenant agrees to keep and maintain the Demised Premises in the same
condition it will be in on the day Tenant takes possession, and to maintain it
in accordance with Tenant's obligation pursuant to Section 10(a) hereof, all
subject to reasonable wear and tear, loss by fire or other casualty and
Landlord's maintenance, repair and replacement obligations.
(d) Tenant shall not use or install any special equipment without the prior
approval of Landlord, which approval shall not be unreasonably withheld.
(e) Tenant shall not act or carry on any practice which may injure the
Demised Premises or the Building in which the same are located, cause any
offensive odors or loud noises, or constitute a public nuisance or menace to any
other tenant or other persons.
(e) Landlord reserves the right to adopt reasonable and uniform rules and
regulations for the operation of the Building and common areas so that the same
shall be operated efficiently and in accordance with other provisions of this
Lease. Tenant agrees to abide by, and require its employees to abide by, said
rules and regulations.
1. Nothing in this Lease contained shall be construed to impose upon
Landlord any duty or obligation to enforce the Rules and Regulations or terms,
covenants or conditions in any other Lease, as against any other tenant unless
Tenant has given Landlord notice of a material and repeated violation of same
which is interfering with Tenant's enjoyment of the Demised Premises,
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and Landlord shall not be liable to Tenant for violation of the same by any
other tenant, its servants, employees, agents, visitors or licenses.
2. If any governmental license or permit regulating or related to
Tenant's business other than a Certificate of Occupancy, shall be required for
the proper and lawful conduct of Tenant's business in the Demised Premises, or
any part thereof, and if failure to secure such license or permit would in any
way affect Landlord, then Tenant, at its expense, shall duly procure and
thereafter, maintain such license or permit and submit same to inspection by
Landlord. Tenant shall at all times comply with the terms and conditions of each
such license or permit, but in no event shall failure to procure and maintain
same by Tenant affect Tenant's obligations hereunder. Except as immediately set
forth above, Landlord, at its sole cost and expense, shall comply with all
applicable laws, codes, statutes, ordinances, rules and regulations relating to
the Demised Premises, the Building and the Land, including, without limitation,
building, health, disability and fire code requirements.
SECTION 10 - REPAIRS
(a) Tenant, at its expense, shall take good care of and repair the interior
of the Demised Premises and fixtures and appurtenances located therein and
replace all light bulbs. Landlord, at its expense, shall take care of, and keep
in repair and good order and condition, all exterior and structural portions
(including the foundations, walls roofs, windows and structural portions of the
ceiling and floors) and all light fixtures. All such repairs and maintenance
shall be performed promptly and in a substantial and workmanlike manner. All
damage or injury to the Demised Premises and to its fixtures, appurtenances and
equipment caused by Tenant moving property in or out of the Building or by
installation or removal of furniture, fixtures or other property, or from any
other cause of any other kind or nature whatsoever due to the neglect, improper
conduct of, or other cause by Tenant, its servants, or employees, shall be
repaired, restored or replaced by Landlord at Tenant's sole cost and expense
(except for loss or damage or other insured against risks contained in fire
insurance policies with standard extended coverage, whether or not said
insurance is actually purchased.) Tenant shall not place a load upon any floor
of the Demised Premises exceeding the floor load per square foot area which such
floor was designed to carry.
(b) During the progress of any work in the Demised Premises performed by
the Landlord pursuant to the provisions hereof, Landlord may keep and store
therein all necessary materials, tools, supplies, and equipment. Landlord shall
not be liable for inconvenience, annoyance, disturbance, loss of business or
other damage of Tenant or any subtenant by reason of making such repairs or
performance of any such work, or on account of bringing materials, tools,
supplies and equipment into the Demised Premises during the course thereof, and
the obligations of Tenant under this Lease shall not be affected thereby,
provided that the Landlord uses efforts reasonable under the circumstances to
minimize to the extent practical any resulting inconvenience, annoyance,
disturbance, loss of business or other damage to Tenant or any subtenant by
reason of making such repairs or the performance of any such work or of any of
the matters referred to above.
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(c) Any mechanic's liens resulting from work done for, or materials
furnished for, Tenant shall be discharged by Tenant within Thirty (30) days
after Tenant receives notice of any such lien at Tenant's expense.
SECTION 11 - FIRE PROTECTION
(a) Landlord agrees that it will keep the Building and other improvements
on the Land insured against loss or damage against the risks contained in fire
insurance policies with standard extended coverage including, vandalism and
malicious mischief and so-called "All Risk." Such insurance shall be maintained
in an amount equal to the full replacement value thereof and shall be sufficient
to prevent any co-insurance provisions from becoming effective. Landlord further
agrees to insure the Building for comprehensive General Liability Insurance in
such amounts held by reasonably prudent commercial landlords of comparable
first-class office properties in the Stamford, Connecticut, area.
(b) Tenant shall not do or permit to be done any act or thing upon the
Demised Premises which will invalidate or be in conflict with the fire insurance
policies covering the Building of which the Demised Premises form a part. Tenant
at its sole expense shall comply with all rules, orders and regulations of the
Board of Fire Underwriters, or any other similar body with regard to its
activities within the Demised Premises, except that this shall not require the
Tenant to make any structural changes that may be required thereby that are
generally applicable to the Building as a whole. The Landlord agrees that it
will notify the Tenant of any act or thing upon the Demised Premises which will
invalidate or be in conflict with said fire insurance policies, or with the
rules, orders and regulations of the Board of Fire Underwriters.
(c) Tenant shall not use the Demised Premises in any manner which shall
cause an increase in the rate of fire insurance for the Building of which the
Demised Premises are a part or on property located therein. If by reason of the
failure of Tenant to comply with provisions of this Section the fire insurance
rates are increased, Tenant shall reimburse Landlord for all such increased
costs.
SECTION 12 - DESTRUCTION OR DAMAGE:
(a) If the Demised Premises and/or access thereto shall be partially or
totally damaged or destroyed by fire, by casualties, by the elements or Acts of
God, Landlord shall, subject to its rights under Paragraph (c) hereof, repair
the damage and restore and rebuild the Demised Premises and/or access thereto as
nearly as may be reasonably practical to its condition and character immediately
prior to such damage or destruction, with reasonable diligence after notice to
it of the damage or destruction.
(b) If the Demised Premises and/or access thereto shall be partially or
totally damaged or destroyed by fire, by casualties, by the elements, or Acts of
God, not attributable to the fault, negligence or misuse of the Demised Premises
by the Tenant, its agents or employees under the provisions of this Lease, the
rents and other charges payable hereunder shall be abated to the extent that the
Demised Premises shall have been rendered untenantable from the date of such
damage until the Demised Premises shall be substantially restored and rendered
tenantable for Tenant's
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business operations. Should Tenant reoccupy a portion of the Demised Premises
during the period that the repair, restoration or rebuilding is in progress and
prior to the date that the same are made completely tenantable, rents allocable
to such portion shall be payable by Tenant from the date of such occupancy to
the date the Demised Premises are made tenantable.
(c) In the case of substantial (i.e., 33% percent or more) or total damage
or destruction of the rentable area of the Demised Premises or access thereto,
Landlord shall, within Thirty (30) days of such damage or destruction, notify
Tenant, in writing, as to whether or not such damage or destruction can
reasonably be renovated or reconstructed within 135 days from the date of said
written notice. If, in Landlord's or Tenant's reasonable judgment, the damage or
destruction cannot be renovated or reconstructed within said 135 day period,
then either Tenant or Landlord may, at its option, terminate this Lease and the
term and estate hereby granted, by notifying the other party, in writing, of
such termination within Twenty (20) days after the date of Landlord's notice, in
which case Landlord shall immediately return any prepaid rent and Security
Deposit.
(d) If Landlord's notice states that the damage can reasonably be renovated
or reconstructed within 135 days from the date of said notice, then Landlord
shall promptly proceed with all due diligence to restore and rebuild the Demised
Premises; and this Lease shall continue in full force and effect and rent shall
xxxxx pursuant to Paragraph (b). In the event that the Demised Premises are not
fully repaired and restored within said 135-day period, and the Landlord has
proceeded with all due diligence but has been delayed by adjustment of
insurance, labor trouble, governmental controls, Acts of God, or any other cause
beyond Landlord's control, then the time for Landlord to complete said
reconstruction and repair shall be extended by such additional time as equals
the aggregate period the Landlord has been delayed; but if such delay shall
exceed an additional thirty (30) days each party shall have the option to
terminate this Lease by notifying the other part in writing of such termination
within Twenty (20) days after the date of such notice, in which case Landlord
shall immediately return any prepaid rent and Security Deposit.
(e) If at any time prior to Landlord giving Tenant such notice of
termination pursuant to Paragraph (c) above or commencing the repair and
restoration pursuant to Paragraph (a), the holder of a superior mortgage or any
person claiming under or through the holder of such superior mortgage takes
possession of the Building through foreclosure or otherwise, such holder or
person shall have a further period of Sixty (60) days from the date of so taking
possession to terminate this Lease by appropriate notice to Tenant. In the event
that such a notice of termination shall be given pursuant to Paragraph (c), this
Lease and Term and estate hereby granted shall expire as of the date of such
termination with the same effect as if that were the date set forth as the
expiration of the Term of this Lease and the fixed and additional rent due and
to become due hereunder shall be apportioned as of such date if not earlier
abated pursuant to Paragraph (b).
(f) During the period of repair and restoration of the Demised Premises,
Landlord shall use its best efforts to assist Tenant in securing alternate
office space.
(g) No damages, compensation or claim shall be payable by Landlord for
inconvenience, loss of business or annoyance arising from any repair or
restoration of any portion of the Demised Premises or of the Building pursuant
to this Section unless due to Landlord's neglect. Landlord shall use its best
efforts to effect such repair or restoration promptly and in such manner as not
unreasonably to interfere with Tenant's use and occupancy.
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(h) Landlord will not carry insurance of any kind on Tenant's property,
and, except as provided by law or its breach of any of its obligations
hereunder, shall not be obligated to repair any damage thereto or replace the
same.
(i) The provisions of this section shall be considered an express agreement
governing any case of damage or destruction of the Demised Premises by fire, by
casualties, by the elements or Acts of God.
(j) Notwithstanding any of the foregoing provisions of this section, if
Landlord or the holder of any superior mortgage shall be unable to collect all
of the insurance proceeds (including rent insurance proceeds) applicable to
damage or destruction of the Demised Premises, or the Building by fire or other
cause, by reason of some action or inaction on the part of Tenant, or any of its
employees, agents, or contractors, then, without prejudice to any other remedies
which may be available against Tenant, the abatement of Tenant's rents provided
for in this section shall not be effective to the extent of the uncollected
insurance proceeds.
(k) Landlord and Tenant hereby waive all rights to recover against each
other for any loss or damage arising from any cost covered by any casualty
insurance required under this Lease, or otherwise actually carried by each of
them. Landlord and Tenant will cause their respective insurers to issue
appropriate waiver of subrogation right endorsements to all policies and
insurance carried in connection with the Demised Premises or the contents of
either of them. Landlord and Tenant hereby agree to look first to the proceeds
of their respective insurance policies before proceeding against each other in
connection with any claim relating to any matter covered by this Lease.
SECTION 13 - COVENANT TO HOLD HARMLESS:
(a) Tenant shall save Landlord harmless and shall indemnify Landlord from
and against all injuries, liability, expense (including reasonable attorney's
fees) claim or damage to any person or property to the extent arising from the
negligence of the Tenant, its agents, servants or employees. Tenant shall
maintain with respect to the Demised Premises public liability insurance with
limits of no less than $1,000,000 Bodily Injury Liability and/or Property Damage
Liability, per occurrence, in companies licensed to do business in the State of
Connecticut and reasonably acceptable to Landlord. Said insurance shall name
Landlord as an "additional insured/landlord" and name Tenant as insured. Tenant
shall deposit with Landlord evidence of said insurance in a format acceptable to
the Landlord at or prior to the commencement of the Term, and thereafter within
Ten (10) days prior to the expiration of such policies.
(b) Landlord shall save Tenant harmless and shall indemnify Tenant from and
against all injuries, liability, expense (including reasonable attorney's fees)
claim or damage to any person or property to the extent arising from arising
from the negligence of Landlord, its agents, servants or employees.
SECTION 14 - PROPERTY LOSS OR DAMAGE:
Landlord shall not be liable for any injury or damage to persons or
property or for any denial of access to the Demised Premises (and any
consequences therefrom) resulting from actual or
14
purported acts of terrorism or war, fire, explosion, falling plaster, steam,
water, rain, or snow or leaks from any part of the Building or from the pipes,
appliances, or plumbing works or by dampness or by any other cause of whatever
nature, unless caused by or due to the negligence of Landlord, its agents,
servants or employees.
SECTION 15 - SERVICES:
(a) As long as Tenant is not in default under any of the covenants of this
Lease, Landlord shall:
1. Provide necessary elevator facilities on business days, business
days being Monday through Friday.
2. Furnish adequate heat to the Demised Premises, when and as required
by law, on business days from 8:00 A.M. to 8:00 P.M. whenever necessary during
the period from October 15th to May 15th in each year.
3. Furnish adequate air conditioning to the Demised Premises on all
business days during the hours of 8:00 A.M. to 8:00 P.M. whenever necessary
during the period from May 15th to October 15th in each year.
(b) Notwithstanding anything to the contrary contained in this Lease,
Landlord shall not be obligated to provide services of any kind to the Tenant,
except Monday through Friday of each week, between the hours of 8:00 A.M. and
8:00 P.M. Any such services provided by the Landlord beyond said hours shall be
charged to the Tenant at the rate of Fifty ($50.00) Dollars per hour,
proportionately reduced to reflect any simultaneous usage of other tenants. In
addition, the rates for such overtime usage shall not exceed the normal and
customary rates charged at comparable first-class office buildings in the
Stamford, Connecticut, area.
(c) Landlord reserves the right upon reasonable notice to stop service of
the heating, air conditioning, elevator, plumbing and electric systems, when
necessary, by reason of accident, or emergency, or for repairs, alterations,
replacements of improvements, in the judgment of Landlord desirable or necessary
to be made, until said repairs, alterations, replacements or improvements shall
have been completed.
(d) Landlord shall supply water for ordinary lavatory, kitchen area and
drinking purposes. If Tenant uses for any purpose additional water, Landlord
reserves the right to install a water meter and thereby measure Tenant's water
consumption. In that event, Tenant shall pay Landlord for the cost of the meter
and the cost of the installation thereof and throughout the duration of Tenant's
occupancy Tenant shall keep said meter and installation equipment in good
working order and repair, in default of which Landlord may cause such meter and
equipment to be replaced or repaired and collect the cost thereof from Tenant.
Tenant agrees to pay as additional rent for water consumed as shown on said
meter, as and when bills are rendered by Tenant by Landlord, at rates fixed by
water supplier.
(e) Tenant shall have access and use of the Demised Premises and the phone
cabinets located on the first and third floors of the Building twenty-four (24)
hours per day, seven (7) days per week, at no extra charge.
(f) Landlord hereby warrants and represents that the HVAC system serving
the Demised Premises shall be in good working order and condition on the
applicable
15
Commencement Date, and shall, throughout the Term, provide levels of
ventilation, humidity, heating and cooling which are appropriate for executive
office occupancies in a first-class building. Except for damage caused by
Tenant's negligence or misuse, Landlord shall be responsible for maintenance,
repairs, replacements and additions to said HVAC system during the Term, said
maintenance to include periodic testing and cleaning of the ductwork as is
reasonably necessary to avoid unsafe or unhealthy interior air conditions.
(g) Landlord hereby warrants and represents that the electrical capacity
for the Building is sufficient for normal and customary general office usage,
including, without limitation, the use of a telephone and paging system,
facsimile equipment, photocopy machines, desk-top computers, word processors,
utility kitchen equipment, and other customary office machines and equipment.
(h) Landlord hereby warrants and represents, that it has no knowledge, of
any materials or substances (collectively, "Substances") in or about the Demised
Premises, the Building or the Land, which are environmentally hazardous or
harmful, or which violate applicable laws, codes, statutes, ordinances,
guidelines, rules and regulations. Said Substances include, without limitation,
asbestos, radon, PCB's or petroleum products. Landlord shall have sole liability
for, and Tenant shall have no liability for, any and all Substances (and any
related equipment such as, but not limited to, underground storage tanks) not
created or deposited by Tenant.
SECTION 16 - DEFAULT:
(a) Landlord may, at its option, terminate this Lease
(i) if rent or additional rent is not paid when due and such
non-payment continues for five (5) days following Landlord's notice of such
non-payment; or
(ii) if Tenant shall have failed to cure a default in the performance
of any covenant of this Lease (except the payment of rent) or any rule or
regulation hereunder within Thirty (30) days, after written notice from Landlord
of such default, or, in the case where such default cannot be cured within
Thirty (30) days the Tenant shall have failed to commence in good faith to cure
such default; or
(iii) if Tenant shall file in bankruptcy or be adjudicated a bankrupt,
make a general assignment for the benefit or creditors, or be declared insolvent
and fail to cure the foregoing within Sixty (60) days; or
(iv) if a receiver or trustee is appointed for any portion of Tenant's
property and such appointment is not vacated within Sixty (60) days; or
(v) if an execution or attachment shall be issued under which the
Demised Premises shall be taken or occupied by anyone other than Tenant; or
(vi) if the Demised Premises are used for some purpose other than the
use authorized by this Lease; or
(vii) if this Lease is mortgaged or assigned without the written
consent of Landlord; or
16
(viii) if any portion of the Demised Premises is sublet other than in
accordance with the provisions of Section 20 hereof; or
(ix) if the Demised Premises become or remain vacant or deserted for a
period of thirty (30) days.
(b) At the expiration of the applicable notice and cure period, this Lease
shall terminate as completely as if that were the date originally fixed for the
expiration of the term of this Lease; but Tenant shall remain liable as
hereinafter provided. Landlord may recover such possession in the manner
prescribed by the statute relating to summary process. The Tenant hereby
expressly waives and will waive all right to trial by jury in summary
proceedings hereafter instituted by the Landlord against Tenant in respect of
the Demised Premises or in any action brought to recover rent or damages
hereunder.
SECTION 17 - REMEDIES OF LANDLORD:
(a) In case of any such default under the provisions of the Section of this
Lease entitled "Default", and the dispossession of the Tenant by summary process
or otherwise:
(i) the rent shall become due thereupon and be paid up to the time of
such default, together with such commercially reasonable expenses as Landlord
may incur for legal expenses, reasonable attorneys' fees, brokerage and/or
putting the Demised Premises in good order or for preparing the same for
rerental. At Landlord's option, Landlord may apply any security deposit provided
under this Lease to any such delinquent rent, and Tenant shall replenish the
portion of the security deposit so applied immediately upon demand therefore;
any such required replenishment shall constitute additional rent.;
(ii) Landlord may relet the Demised Premises or any part or parts
thereof as Tenant's agent in the name of Landlord, or otherwise, for a term or
terms, which may at Landlord's option be less than or exceed the period which
would otherwise have constituted the balance of the term of this Lease and may
grant commercially reasonable free concessions or free rent; and/or
(iii) Tenant shall also pay Landlord as liquidated damages for the
failure of Tenant to observe and perform Tenant's covenants herein contained,
any deficiency between the rent hereby reserved and/or covenanted to be paid and
the net amount, if any, of the rents collected on account of this Lease of
Demised Premises for each month of the period which would otherwise have
constituted the balance of the term of this Lease. In computing such liquidated
damages there shall be added to said deficiency such reasonable expenses as
Landlord may incur in connection with reletting, such as legal expenses,
reasonable attorneys' fees, brokerage and for keeping the Demised Premises in
good order or for preparing the same for reletting. Any such liquidated damages
shall be due and payable on the basis of the rent which had become due and
payable for the month prior to the default, and any suit brought to collect the
amount of the deficiency for any month shall not prejudice in any way the rights
of Landlord to collect the deficiency for any subsequent month by a similar
proceeding. Landlord at Landlord's option may make such alterations, repairs,
replacements and/or decorations in the Demised Premises as Landlord in
Landlord's sole commercially reasonable judgment considers advisable and
necessary for the purpose of reletting the Demised Premises; and the making of
such alterations and/or decorations
17
shall not operate or be construed to release Tenant from liability hereunder as
aforesaid. Landlord shall have a duty to reasonably mitigate its damages
following any Tenant default.
(b) In the event of a breach by Tenant of any of the covenants or
provisions hereof, Landlord shall have the right to seek an injunction and the
right to invoke any remedy allowed at law or in equity as if reentry, summary
process and other remedies were not herein provided for. Mention in this Lease
of any particular remedy shall not preclude Landlord from any other remedy in
law or in equity.
(c) If Tenant shall default in the observance or performance of any term or
covenant of this Lease, Landlord may immediately or at any time thereafter upon
reasonable notice perform the same for the account of Tenant, and if Landlord
makes any expenditures or incurs any obligations for the payment of money
including, but not limited to, reasonable attorneys' fees, instituting,
prosecuting or defending any action or proceeding, such sums paid or obligation
incurred with interest and costs shall be deemed to be additional rent hereunder
and shall be paid by Tenant to Landlord within Five (5) days of rendition of any
xxxx or statement to Tenant.
(d) If such termination and/or reentry is the result of Tenant's
bankruptcy, insolvency or judicial reorganization, neither Tenant nor any person
claiming through or under Tenant by virtue of any statute or court order shall
be entitled to possession or to remain in possession and Landlord, in addition
to any other remedies or rule or law may retain as liquidated damages any rent,
security deposit or monies received by it from Tenant or others on behalf of
Tenant and may recover as liquidated damages hereunder an amount equal to the
difference between the rent reserved hereunder for the unexpired portion of the
term demised and the then fair and reasonable rental value of the Demised
Premises for the same period discounted at the rate of four (4%) percent per
annum. Nothing herein contained shall limit or prejudice the right of Landlord
to prove and obtain as liquidated damages by reason of such termination an
amount equal to the maximum allowed by any statute or rule or law in effect at
the time when, and governing the proceedings in which, such damages are to be
proved, whether or not such amount be greater equal to, or less than the amount
of the difference referred to above.
(e) If Tenant abandons or vacates the Demised Premises in violation of this
Lease, any property left in the Demised Premises by Tenant shall be deemed to
have been abandoned by Tenant, and Landlord shall have the right to retain or
dispose of such property in any manner and without any obligation to account
therefor to Tenant.
SECTION 18 - EMINENT DOMAIN;
(a) If the whole or any substantial part of the Demised Premises or access
thereto shall be taken, acquired or purchased by or through condemnation
proceedings or any right of eminent domain or any other authority of law, the
term of this Lease shall end as of the effective date of such taking. In
addition, if any such condemnation or taking renders the Demised Premises
untenantable for Tenant's business, Tenant shall have the right to terminate
this Lease upon written notice to Landlord. Rent shall be apportioned as of the
date of such termination. In the event the property taken, acquired or purchased
by or through such condemnation proceedings consist only of land constituting
parking spaces, accessways or driveways, the Term of this Lease shall not end if
the Landlord can arrange reasonably similar substitute facilities within a
reasonable time. In the event
18
of any condemnation in which this Lease is not terminated, all rent shall be
proportionately abated to reflect the rentable area of the Demised Premises
remaining tenantable after such taking, and Landlord, at its sole cost and
expense, shall promptly repair and restore the areas of the Demised Premises
which are not affected by such taking to the extent practicable and necessary
under the circumstances to render such unaffected area tenantable.
(b) Landlord reserves to itself all rights to damages or compensation
accruing on account of any such taking of the real property as aforesaid, or by
reason of any act of any public or quasi-public authority for which damages are
payable. Nothing herein contained, however, shall deprive Tenant of its right to
claim and recover, in any taking or other proceedings against the condemning
authority, for its loss or damage to its fixtures or any improvements paid for
by Tenant which have not become part of the realty or for the cost of relocating
from the Demised Premises and all other losses and costs (including loss of
business) incident to or in consequence of the closing or rebuilding of the
Demised Premises or the removal therefrom or rearrangement thereof, provided,
however, that no provisions herein allowing Tenant to make a claim for a
separate award shall in any way diminish the award to Landlord for the full
value of the Demised Premises and the Land and Building of which they are a
part, without deduction therefrom of any value which may be attributable to
Tenant's leasehold estate under this lease.
SECTION 19 - SUBORDINATION: ESTOPPEL CERTIFICATE:
(a) This Lease is subject and subordinate to all mortgages and trust
indentures which may now or hereafter affect the real property of which the
Demised Premises form a part, and to all modifications, consolidations,
replacements, renewals, and extensions thereof. This clause shall be
self-operative, and no further instrument of subordination shall be required by
any such mortgagee. In confirmation of such subordination, Tenant shall execute
promptly and deliver to Landlord any instrument that may be requested.
(b) In the event that someone other than Landlord comes into ownership or
possession of the Demised Premises, this Lease shall be valid and continue in
full force and effect and shall not be terminated. Tenant shall be deemed to
have attorned, and shall attorn, to the holder of any mortgage acquiring title
by virtue of a conveyance or through foreclosure proceedings, and such
attornment shall not be terminated by reason of any foreclosure under such
mortgage or any similar action pursuant to which such holder succeeds to the
interest of Landlord. Tenant agrees to execute such further evidences of
attornment as the holder of any such mortgage may from time to time reasonably
request. Landlord agrees to use its best efforts to obtain from the holder of
any mortgage placed or to be placed upon the Demised Premises, an agreement in
recordable form containing a covenant that so long as Tenant is not in default
under the terms of this Lease, Tenant's leasehold estate under this Lease shall
not be terminated or disturbed by such holder, subsequent to a default by
Landlord under such mortgage, or foreclosure under such mortgage or any similar
action pursuant to which such holder succeeds to the interest of Landlord.
Notwithstanding anything to the contrary contained in this Lease, Tenant's
subordination and attornment to any future mortgages, ground leases or
encumbrances shall be conditioned upon the Landlord using its commercially
reasonable efforts to obtain and deliver to Tenant a reasonable and binding
nondisturbance agreements protecting Tenant's tenancy as long as Tenant is not
in default of its
19
obligations under this Lease. In addition, Landlord shall use its commercially
reasonable efforts to obtain such nondisturbance agreement(s) from any and all
current mortgagees or ground lessors and provide same to Tenant within sixty
(60) days of the date of this Lease.
(c) At the option of the Landlord or any successor Landlord or the holder
of any mortgage affecting the Demised Premises, Tenant agrees that neither the
foreclosure of a mortgage affecting the Demised Premises, nor the institution of
any suit, action, summary or other proceeding against the Landlord herein or any
successor Landlord, nor any foreclosure proceeding brought by the holder or any
such mortgage to recover possession of such property, shall by operation of law
or otherwise result in cancellation or termination of this Lease or the
obligations of the Tenant hereunder, and upon request of any such Landlord,
successor Landlord or the holder of such mortgage, Tenant covenants and agrees
to execute an instrument in writing satisfactory to such successor Landlord or
to any successor to the Landlord's interest in the Demised Premises, or to the
holder of such mortgage or to the purchaser of the mortgaged Demised Premises in
foreclosure whereby Tenant attorns to such successor in interest.
(d) In the event of any act or omission by the Landlord which would give
the Tenant the right to terminate this Lease or to claim a partial or total
eviction, pursuant to the terms of this Lease, if any, the Tenant will not
exercise any such right until:
1. It has given written notice of such act or omission to the holder
of any mortgage covering the Building whose name and address shall previously
have been furnished to Tenant, by delivering such notice of such act or omission
to such holder at the last address so furnished; and
2. A reasonable period not to exceed Forty-five (45) days for
remedying such act or omission shall have elapsed following such giving of
notice during which such parties or any or them, with reasonable diligence
following the giving of such notice, has not commenced and continued to remedy
such act or omission or to cause the same to be remedied.
(e) If, in connection with obtaining financing for the Land and/or
Building, a banking, insurance or other recognized institutional lender shall
request reasonable modifications in this Lease as a condition to such financing,
Tenant will not unreasonably withhold, delay or defer its consent thereto,
provided that such modifications do not increase the obligations of Tenant
hereunder or unreasonably adversely affect the leasehold interest hereby created
or Tenant's use and enjoyment of the Demised Premises.
(f) Tenant agrees, at any time, and from time to time, upon not less than
Ten (10) business days prior notice by Landlord, to execute, acknowledge and
deliver to Landlord, a statement in writing addressed to Landlord certifying
that this Lease is unmodified and in full force and effect (or, if there have
been modifications, that the same are in full force and effect as modified and
stating the modifications) stating the dates to which the fixed minimum rent,
additional rental and other charges have been paid, and stating whether or not,
to the best knowledge of the signer of such certificate there exists any default
in the performance of any covenant, agreement, term, provision, or condition
contained in this Lease, and, if so, specifying each such default of which the
signer may have knowledge, it being intended that any such statement delivered
pursuant hereto may be relied upon by Landlord and by any mortgagee or
prospective mortgagee of any mortgage affecting the Building or the Building and
the Land.
20
SECTION 20 - ASSIGNMENT AND SUBLETTING:
Provided the terms and conditions set forth in clauses (a) through (e)
below have been met and Tenant notifies Landlord in writing of its intention to
do so at least ten (10) days prior to the date in question Tenant shall have the
right without obtaining Landlord's consent, to assign this Lease or sublet all
or part of the Demised Premises to any affiliate, parent, subsidiary, divisional
entity, partner, joint venture entity or related business entity of Tenant, or
to any entity arising by virtue of merger, consolidation or other business
combination with Tenant or Tenant's parent entity, or to any purchaser of all or
substantially all of Tenant's stock or assets, or to any entity under the
ownership or control of Tenant's parent entity or holding entity (individually,
a "Related Entity" and collectively, "Related Entities"). During the term of
this Lease, or any renewal thereof, the Tenant may not assign or sublet all or a
portion of the Demised Premises to any parties not constituting a Related Entity
without the express written consent of the Landlord, which consent shall not be
unreasonably withheld or delayed and upon the further express terms and
conditions:
(a) That the Tenant shall not be in material default of any provision of
this Lease;
(b) That the Tenant shall demonstrate to the reasonable satisfaction of the
Landlord:
(i) The office use by the proposed lessee of the Demised Premises
shall be similar to that of the Tenant.
(ii) The use by the proposed lessee shall not be substantially more
intense (by virtue of density of occupancy, applicable fire codes, hours of use,
or otherwise) than that of the Tenant;
(c) That the Tenant shall remain fully liable under the terms of this
Lease; and
(d) That the Tenant shall pay over to the Landlord and the Landlord shall
be entitled to receive Fifty Percent (50%) of all rentals, escalations and
payments due and payable to Tenant from the proposed lessee/assignee in
connection with the sublease (or assignment of the Lease) of the Demised
Premises which are in excess of the rentals, escalations and payments paid by
the Tenant under this Lease and after Tenant deducts its reasonable brokerage,
advertising and attorneys' fees, as well as any fit-up expenditures and free
rent concessions.
(e) That in the case of an assignment of this Lease (which assignment shall
not release Tenant of its obligations under this Lease), Tenant shall have
delivered a written assumption by the assignee of the obligations of Tenant
under this Lease.
For purposes hereof, Landlord shall grant or withhold its consent in writing
(with specific reasons for withholding its consent), within thirty (30) days
after receiving Tenant's request therefor. Landlord's failure to so respond
within said thirty (30) day period shall be deemed a consent to said proposed
assignment or sublease. Upon any permitted sublease, Landlord, upon Tenant's
request and at Tenant's sole cost and expense, agrees to enter into a reasonable
nondisturbance agreement with any such subtenant.
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SECTION 21 - SECURITY DEPOSIT:
The Landlord hereby acknowledges receipt from the Tenant of the sum of
Twenty Three Thousand Seven Hundred Fifty Seven and 34/100 ($23,757.34) Dollars
to be held by Landlord as security for the faithful performance by the Tenant of
all terms, conditions and provisions of this Lease, which sum (subject to the
provisions hereinafter set forth) shall be promptly returned by the Landlord to
the Tenant after the termination of this Lease, provided the Tenant shall
faithfully perform the terms and conditions hereof. The above sum shall be
increased by Nine Thousand Forty Nine and 34/100 ($9,049.34) Dollars to Thirty
Two Thousand Seven Hundred Six and 68/100 ($32,706.68) Dollars as a precondition
to the occupancy by Tenant of the Additional Space. The rights provided
hereunder are in addition to such other rights that the Landlord may have. In
the event of the sale of the Demised Premises by the Landlord, it shall assign
the deposit referred to herein (the "Security Deposit") to the purchaser and
provide written notice to Tenant. Unless otherwise provided in this Lease or
otherwise elected by Landlord in Landlord's sole discretion, the Security
Deposit referred to herein shall not, under any circumstances, be used or
applied toward any rent or other payment required to be made by the Tenant under
the terms of this Lease.
SECTION 22 - INABILITY TO PERFORM:
(a) Except as hereinafter otherwise provided, if Landlord is prevented or
delayed in performing or complying with any of the covenants or provisions
hereunder on the part of the Landlord to be performed or complied with, or if
Landlord is unable to fulfill any of its obligations under this Lease or to
supply, or is delayed in supplying, any service expressly or impliedly to be
supplied or is unable to make, or is delayed in making any repair, additions,
alterations, or decorations or is unable to supply or is delayed in supplying
any equipment or fixtures, by reason of actual or purported acts of terrorism or
by reason of strike or labor troubles, including, but not limited to,
governmental preemption in connection with a National Emergency or by reason of
a change subsequent to the date of this Lease, in any rule, order, or regulation
of any department or subdivision thereof or any government agency or by reason
of the conditions of supply and demand which have been or are affected by way of
other emergency, this Lease and the obligations of Tenant to pay rent or
additional rent hereunder and perform and comply with all of the other covenants
and agreements hereunder on the part of the Tenant to be performed and complied
with shall in no wise be affected, impaired, or excused, because of Landlord's
delay or failure to perform or comply with any of the covenants or provisions
hereunder on the part of the Landlord to be performed or complied with, nor
because Landlord is unable to fulfill any of its obligations under this Lease or
to supply or is delayed in supplying, any service expressly or impliedly to be
supplied or is unable to make, or is delayed in making any repair, additions,
alternations, or decorations or is unable to supply or is delayed in supplying
any equipment or fixtures.
(b) Should any Landlord-provided services (including the utilities
described in Section 8 above) be interrupted or terminated for any of the
foregoing reasons or as a result of Landlord's negligence (a "Service
Interruption") and such Service Interruption continues for a
22
period of three (3) or more consecutive business days after Tenant delivers
written notice to Landlord of such Service Interruption, then all rent shall
xxxxx as to those portions of the Demised Premises rendered untenantable from
and including the first (1st) business day after Landlord's receipt of such
written notice from Tenant and such abatement shall continue until such service
is restored. In addition to the foregoing, if a Service Interruption occurs and
continues for a period in excess of thirty (30) consecutive days, Tenant, at its
option, shall be entitled to terminate this Lease by providing Landlord written
notice of such termination.
SECTION 23 - NO BROKERS:
Tenant represents and warrants that no brokers interested Tenant in the
Demised Premises. Tenant shall indemnify and hold the Landlord harmless from the
claim of any real estate broker or salesman claiming to have interested the
Tenant in or having been responsible for Tenant's execution of this Lease; but
Tenant shall not be responsible for any claim arising solely out of any
exclusive listing given by Landlord. Landlord hereby warrants and represents
that it has dealt with no brokers or agents in connection with this Lease, and
shall indemnify and hold Tenant harmless from and against all losses,
liabilities, claims, damages and expenses (including, without limitation,
reasonable attorneys' fees) arising out of Landlord's breach of said
representation.
SECTION 24 - SUCCESSORS AND ASSIGNS:
(a) The covenants, conditions and agreements contained in this Lease shall
bind and enure to the benefit of the parties hereto and their respective heirs,
legal representative, successors and, except as otherwise provided herein, their
assigns. The term "Landlord" wherever used in this Lease shall be limited to
mean and include only the owner or owners at the time in question of the
Building to whom this Lease may be assigned, or a mortgagee in possession, so
that in the event of any sale, assignment or transfer of the Building, any prior
owner or mortgagee in possession shall thereupon be released and discharged from
all covenants, conditions and agreements accruing on and after such sale,
assignment or transfer and this Lease shall be binding upon each new owner or
mortgagee in possession for the time being of the Building, until sold, assigned
or transferred.
(b) Tenant shall look solely to the estate and interest of Landlord, its
successors and assigns, in the Land and Building (or the proceeds thereof,
including, without limitation, any sales, rental and insurance proceeds) for the
collection of a judgment (or other judicial process) requiring the payment of
money by Landlord in the event of any default by Landlord, hereunder, and no
other property or assets of Landlord shall be subject to levy, execution or
other enforcement procedure for the satisfaction of Tenant's remedies under or
with respect to either this Lease, the relationship of Landlord and Tenant
hereunder or Tenant's use and occupancy of the Demised Premises.
SECTION 25 - MAINTENANCE SERVICE
Landlord shall, during the term of this Lease, perform the services as set
forth in Exhibit "C" attached hereto.
23
SECTION 26 - CHANGES IN BUILDING
Landlord reserves the right at any time without incurring any liability to
Tenant therefor to make such changes in or to the Building and the fixtures and
equipment thereof, as well as in or to the street entrances, halls passages,
elevators and stairways thereof, as it may deem necessary or desirable; provided
that no unreasonable interference with the use of the Demised Premises or in the
services furnished to the Demised Premises, and no reduction in the area of the
Demised Premises shall occur as a result of the exercise of such right.
SECTION 27 - NOTICES:
All notices and demands which are required to or are permitted by the terms
of this Lease shall be given in writing, whether herein specified or not, and
shall be sent by hand or by United States registered or certified mail, postage
prepaid, addressed to the parties as follows:
To or for the Landlord:
Eight Fifty Canal, LLC
000 Xxxxx Xxxxxx
Xxxxxxxx, XX 00000
Attn: Xxxxxx Xxxxxx, Properties Manager
To or for the Tenant:
MTM Technologies, Inc.
000 Xxxxx Xxxxxx
Xxxxxxxx, XX 00000
Attn: Xxxxx X. Xxxxxx, CEO
With a copy to:
MTM Technologies, Inc.
000 Xxxxx Xxxxxx
Xxxxxxxx, XX 00000
Attn: Xxxx X. Xxxxxx, SVP and General Counsel
SECTION 28 - NO WAIVER: ENTIRE AGREEMENT:
(a) The failure of Landlord to seek redress for violation of, or to insist
upon the strict performance of any covenant or condition of this Lease or any of
the Rules and Regulations adopted by Landlord shall not prevent a subsequent
act, which would originally have constituted a violation, from having all the
force and effect of an original violation. The receipt by Landlord of rent with
knowledge of the breach of any covenant of this Lease shall not be deemed to be
a waiver
24
of such breach by Landlord, unless such waiver is in writing signed by Landlord.
No payment by Tenant or receipt by Landlord of a lesser amount than the monthly
rent herein stipulated shall be deemed to be other than on account of the
earliest stipulated rent, nor shall any endorsement or statement on any check,
or letter accompanying any check or payment as rent be deemed an accord and
satisfaction, and Landlord may accept the check or payment without prejudice to
Landlord's right to recover the balance of such rent or pursue any other remedy
in this Lease provided.
(b) This Lease contains the entire agreement between Landlord and Tenant
and any agreement hereafter made between Landlord and Tenant shall be
ineffective to change, modify, waive, release, discharge, terminate or effect an
abandonment of this Lease, in whole or in part, unless such agreement is in
writing and signed by the party against whom enforcement of the change,
modification, waiver, release, discharge, termination or the effecting of the
abandonment is sought.
(c) If any term or provision of this Lease shall, to any extent, be invalid
or unenforceable, the remainder of this Lease shall not be affected thereby and
the balance of the terms and provisions of this Lease shall be valid and
enforceable to the fullest extent, either hereunder or as permitted by the law.
SECTION 29 - GOVERNING LAW:
This Lease and the rights and obligations of the parties shall be construed
under and governed by the laws of the State of Connecticut.
SECTION 30 - CAPTIONS:
The captions herein are inserted only for convenience and are in no way to
be construed as part of this Lease or as a limitation of the scope of any
provisions of this Lease.
SECTION 31 - OPTION TO RENEW
Tenant shall have the option to renew this Lease on the same terms and
conditions as herein provided, for a further period of five (5) years commencing
September 1, 2009 and ending August 31, 2014 (the "Renewal Term") provided that
the annual rental shall be adjusted to reflect 95% of the then fair market value
of similar office space in the general area.
(a) Tenant shall not, at the time of exercising this option, be in default
of this Lease, and
(b) Prior to the expiration of this Lease, Tenant shall have given not less
than three (3) months written notice to the Landlord of its intention to
exercise this option.
SECTION 32 - RIGHT OF FIRST REFUSAL FOR ADDITIONAL SPACE
(a) Provided Tenant is not in default under this Lease (either at the time
of Tenant's election or immediately prior to the subsequent time of actual
occupancy), and subject to any rights of first refusal or similar expansion
options which may exist in any existing leases for space in the Building, Tenant
shall have the continuous right of first option to lease any space on the third
floor
25
of the Building other than the Additional Space described in Section 1 hereof
(collectively and severally, the "Section 32 Additional Space") which may become
available during the original five (5) year term of this Lease, upon the
specific terms and conditions set forth in this Section. The annual rental for
any such Section 32 Additional Space for which Tenant exercises its rights
pursuant to this subparagraph shall be the then "fair market rental value" of
the Section 32 Additional Space at the time of exercise. Tenant shall have ten
(10) business days from the date Tenant receives notice from Landlord of the
availability of any such Section 32 Additional Space to notify Landlord in
writing of Tenant's intention to add such space to this Lease. Tenant is under
no obligation to elect to add to this Lease all Section 32 Additional Space
which may become available.
(b) Tenant acknowledges that the rights afforded Tenant under this Section
are valuable, and that in reliance of any exercise by Tenant of such rights
Landlord will have foregone the opportunity to market any such Section 32
Additional Space to third parties at a point in time which will in many cases be
prior to the time such space actually becomes vacant. Accordingly, Tenant
acknowledges that any such notification or exercise by Tenant shall be binding
upon Tenant, and that Tenant shall be bound to Landlord for the lease of such
Section 32 Additional Space at the appropriate rental and appropriate term as if
a formal amendment to this Lease had been executed between the parties.
Following its receipt of any such notice or exercise, Landlord will cause a
suitable amendment of this Lease to be prepared to more formally reflect the
agreement of the parties, but the failure of Tenant to execute any such
amendment shall not absolve Tenant of its obligations as reflected in the
related notice or exercise, which for all intents and purposes shall be deemed
an amendment to this Lease without the need for any acknowledgment of the same
by Landlord.
(c) The length of the term for any Section 32 Additional Space added to
this Lease pursuant to this Section shall be equal to the then unexpired portion
of the initial Term of this Lease remaining at the time any Section 32
Additional Space is added, excluding any previously or subsequently exercised
renewal terms. The commencement date of the term for any Section 32 Additional
Space shall be the earlier of (x) the date any such Section 32 Additional Space
is made available to Tenant for occupancy, if Tenant elected to add any such
space in its "as-is" condition, or (y) the date any such Section 32 Additional
Space is made available to Tenant for occupancy following procurement of any
certificate of occupancy required as a result of any fit-up work requested by
Tenant; provided however, if the issuance of the certificate of occupancy is
delayed as a result of any action or inaction on the part of Tenant, including
without limitation, Tenant's failure to provide or approve plans for the
improvements in a commercially reasonable manner and time frame (a "Tenant
Delay"), then the term shall commence on the date on which Landlord would have
reasonably anticipated the certificate of occupancy to have been issued but for
the Tenant Delay.
SECTION 33 - MISCELLANEOUS
(a) In each case in which a party's approval or consent is expressly
required under this Lease, such party shall not unreasonably withhold, condition
or delay such approval or consent unless the context clearly states otherwise.
26
(b) Upon Tenant's request, Landlord shall promptly execute and deliver a
statutory Notice of Lease or short form memorandum of Lease for recording in the
appropriate Land Records.
(c) Following the execution of this Lease and the simultaneous delivery to
Landlord of the security deposit and proof of insurance required to be tendered
to Landlord under this Lease, Tenant shall be given access to the Demised
Premises prior to Original Space Rent Commencement Date for the purpose of
installation of Tenant's wiring as provided in the Landlord's Work Letter
attached hereto.
(d) In addition, Landlord shall provide Tenant with access, without the
payment of rent or other fees, to three (3) offices and six (6) phone lines in
the Landlord's affiliate's facility located at 000 Xxxxx Xxxxxx, Xxxxxxxx, XX
(the "Corporate Centres Facility") prior to the Commencement Date, provided that
the Tenant will reimburse the Landlord's affiliate for telephone changes
incurred by the Tenant.
(e) To the extent available at such time, Landlord shall provide to Tenant,
free of all charges for rent and any other fees, with such temporary office
space at the Corporate Centres Facility as is reasonably necessary to support
Tenant's personnel dislocated during the fit-up of the Additional Space.
END OF TEXT OF LEASE. THE NEXT PAGE IS THE SIGNATURE PAGE.
27
IN WITNESS WHEREOF, the Landlord and Tenant have executed this Lease as of
the day and year first above written.
EIGHT FIFTY CANAL, LLC
By: /s/ Xxxxx Xxxxxx Xxxxxxx
----------------------------- ----------------------------
(AS TO LANDLORD) Xxxxx Xxxxxx Xxxxxxx,
Manager
MTM TECHNOLOGIES, INC.
By: /s/ Xxxxxxx X. Xxxxxx
----------------------------- ----------------------------
(AS TO TENANT) Xxxxxxx X. Xxxxxx,
Chief Executive Officer
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TABLE OF CONTENTS
Section:
--------
1. Demised Premises
2. Parking
3. Term of Lease
4. Rent
5. Covenants
6. Fit-Up and Alterations
7. Additional Rent; Escalations
8. Utilities
9. Use and Operation of Premises
10. Repairs
11. Fire Protection
12. Destruction or Damage
13. Covenant to Hold Harmless
14. Property Loss or Damage
15. Services
16. Default
17. Remedies of Landlord
18. Eminent Domain
19. Subordination: Estoppel Certificate
20. Assignment and Subletting
21. Security Deposit
22. Inability to Perform
23. No Brokers
24. Successors and Assigns
25. Maintenance
26. Charges in Building
27. Notices
28. No Waiver: Entire Agreement
29. Governing Law
30. Captions
31. Option to Renew
32. Right of First Refusal for Contiguous Space
33. Miscellaneous
Exhibits:
---------
A. Demised Premises
A1. Landlord's Work List
B. Description of Land
C. Landlord's Cleaning Schedule
29
