<PAGE>
EXHIBIT 10.4
LEASE
BY AND BETWEEN
TRUSTEES OF 4 MAGUIRE ROAD REALTY TRUST
LANDLORD
AND
PREDIX PHARMACEUTICALS HOLDINGS, INC.
TENANT
4 MAGUIRE ROAD
LEXINGTON,
MASSACHUSETTS
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Table of Contents
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ARTICLE 1 Reference
Data.............................................. 1
1.1 Introduction and Subjects
Referred To......................... 1
1.2
Exhibits......................................................
2
ARTICLE 2 Premises and
Term........................................... 3
2.1
Premises......................................................
3
2.2
Term..........................................................
3
2.3 Extension
Option.............................................. 3
2.4 Measurement of the Premises
and Building...................... 5
ARTICLE 3 Commencement and
Condition.................................. 5
3.1 Commencement
Date............................................. 5
3.2 Preparation of the
Premises................................... 5
3.3 Conclusiveness of Landlord's
Performance...................... 7
3.4 Tenant Delay: Force
Majeure................................... 7
3.5 Construction
Representatives.................................. 9
3.6 Application of Remaining
Contribution......................... 9
3.7 Early
Access..................................................
10
ARTICLE 4 Rent, Additional Rent, Insurance
and Other Charges.......... 10
4.1 The Annual Fixed
Rent......................................... 10
4.2 Additional
Rent............................................... 10
4.2.1 Real Estate Taxes.......................................
11
4.2.2 Operating Costs.........................................
12
4.3 Personal Property and Sales
Taxes............................. 16
4.4
Insurance.....................................................
16
4.5
Utilities.....................................................
17
4.6 Late Payment of
Rent.......................................... 18
4.7 Security
Deposit.............................................. 18
ARTICLE 5 Landlord's
Covenants........................................ 20
5.1 Affirmative
Covenants......................................... 20
5.1.1 Heat and Air-Conditioning...............................
20
5.1.2 Landscaping.............................................
20
5.1.3 Elevator, Lighting and Electricity......................
20
5.1.4 Repairs.................................................
21
5.2
Interruption..................................................
21
5.3 Outside
Services.............................................. 21
5.4 Access to
Building............................................ 21
5.5
Parking.......................................................
22
5.6 Compliance with Americans
with Disabilities Act............... 22
5.7 Hazardous Waste
Representation and Covenants.................. 22
5.8
Indemnification...............................................
23
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ARTICLE 6 Tenant's Additional
Covenants..................................................
23
6.1 Affirmative
Covenants............................................................
23
6.1.1 Perform
Obligations........................................................
23
6.1.2
Use........................................................................
23
6.1.3 Repair and
Maintenance.....................................................
23
6.1.4 Compliance with
Law........................................................
24
6.1.5
Indemnification............................................................
24
6.1.6 Landlord's Right to
Enter..................................................
25
6.1.7 Personal Property at Tenant's
Risk......................................... 25
6.1.8 Payment of Landlord's Cost of
Enforcement.................................. 25
6.1.9 Yield
Up...................................................................
26
6.1.10 Rules and
Regulations.....................................................
27
6.1.11 Estoppel
Certificate......................................................
27
6.1.12 Landlord's Expenses For
Consents.......................................... 27
6.1.13 Financial
Information.....................................................
27
6.2 Negative
Covenants...............................................................
27
6.2.1 Assignment and
Subletting..................................................
27
6.2.2
Nuisance...................................................................
31
6.2.3 Floor Load; Heavy
Equipment................................................
31
6.2.4
Electricity................................................................
32
6.2.5 Installation, Alterations or
Additions..................................... 32
6.2.6 Intentionally
Deleted......................................................
33
6.2.7
Signs......................................................................
33
6.2.8 Oil and Hazardous
Materials................................................
34
ARTICLE 7 Casualty or
Taking.............................................................
35
7.1
Termination......................................................................
35
7.1.1 Termination by Landlord
................................................... 35
7.1.2 Termination by
Tenant......................................................
36
7.2
Restoration......................................................................
36
7.3
Award............................................................................
37
7.4 Effect of Casualty or Taking
on the Tax Excess and the Operating Cost Excess..... 37
ARTICLE 8
Defaults.......................................................................
37
8.1 Default of
Tenant................................................................
37
8.2
Remedies.........................................................................
38
8.3 Remedies
Cumulative..............................................................
40
8.4 Landlord's Right to Cure
Defaults................................................
40
8.5 Holding
Over.....................................................................
41
8.6 Effect of Waivers of
Default.....................................................
41
8.7 No Waiver,
etc...................................................................
41
8.8 No Accord and
Satisfaction.......................................................
41
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ARTICLE 9 Rights of
Holders..............................................................
42
9.1 Rights of Mortgagees or
Ground Lessor............................................
42
9.2
Modifications....................................................................
43
9.3 Subordination,
Non-Disturbance and Attornment....................................
43
ARTICLE 10 Miscellaneous
Provisions......................................................
43
10.1
Notices..........................................................................
43
10.2 Quiet Enjoyment; Landlord's Right
to Make Alterations, Etc....................... 43
10.3 Recording of Lease;
Confidentiality of Lease Terms...............................
44
10.4 Assignment of Rents and Transfer
of Title; Limitation of Landlord's Liability.... 44
10.5 Landlord's
Default...............................................................
45
10.6 Notice to Mortgagee and Ground
Lessor............................................ 46
10.7
Brokerage........................................................................
46
10.8 Applicable Law and
Construction..................................................
46
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LEASE
4 Maguire Road
Lexington, Massachusetts
ARTICLE 1
Reference Data
1.1 Introduction and Subjects Referred
To.
This is a
lease (this "Lease") entered into by and between Trustees of 4
Maguire Road Realty Trust, under
Declaration of Trust dated January 30, 1998 and
filed with Middlesex County Registry
District of the Land Court as Document No.
1054066 ("Landlord") and Predix
Pharmaceuticals Holdings, Inc., a Delaware
corporation ("Tenant").
Each
reference in this Lease to any of the following terms or
phrases
shall be construed to incorporate the
corresponding definition stated in this
Section 1.1.
Date of this
Lease:
January 25, 2005.
Building
and Property: That building in the
Town of Lexington,
Massachusetts known as 4 Maguire Road (the
"Building"). The Building and the land parcels
on which it is located and the sidewalks
adjacent thereto are hereinafter collectively
referred to as the "Property".
Premises:
A portion of the first floor of the Building
containing a pH neutralization tank and related
equipment, the exact location and size to be
determined by Landlord and Tenant by the Final
Plans Date, and the entire rentable area on the
second floor of the Building, substantially as
shown on Exhibit A hereto.
Premises
Rentable Area:
27,500 square feet, subject to the provisions of
Section 2.4.
Original
Term:
Seven (7) years and two (2) months, commencing
on the Commencement Date and expiring on the day
preceding the seventh anniversary of the Rent
Commencement Date.
Annual
Fixed Rent:
The sum of (i) for the period commencing on the
Rent Commencement Date and expiring on the day
preceding the first anniversary of the Rent
Commencement Date, $16.29 per square foot of
Premises Rentable Area, (ii) for the period
commencing on the first anniversary of the Rent
Commencement Date and expiring on the day
preceding the second anniversary of the Rent
Commencement Date, $19.55
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per square foot of Premises Rentable Area, (iii)
for the period commencing on the second
anniversary of the Rent Commencement Date and
expiring on the day preceding the fifth
anniversary of the Rent Commencement Date,
$25.00 per square foot of Premises Rentable Area
per annum, and (iv) for the remaining two (2)
years of the Original Term, $27.50 per square
foot of Premises Rentable Area per annum. The
first Year shall be the period commencing on the
Rent Commencement Date and expiring on the day
preceding the first anniversary of the Rent
Commencement Date, and each subsequent
twelve-month period shall be a subsequent Year.
Tenant's
Percentage: Fifty
percent (50%), subject to the provisions
of Section 2.4.
Permitted
Uses:
General offices and pharmaceutical research and
laboratory purposes and any other lawful
purposes ancillary to the aforesaid principle
uses, subject to the provisions of Subsection
6.1.2.
Plan
Submission Date: March 2,
2005.
Final
Plans Date:
March 31, 2005.
Security
Deposit:
$450,000, subject to reduction as provided in
Section 4.7.
Commercial
General
$5,000,000 per occurrence (combined single
Liability
Insurance
limit) for property damage, bodily and personal
Limits:
injury and death.
Original
Address of c/o
Reit Management & Research LLC
Landlord:
400 Centre Street
Newton, Massachusetts 02458
Original
Address of 10K
Gill Street
Tenant:
Woburn, Massachusetts 01801
1.2
Exhibits.
The
Exhibits listed below in this section are incorporated in this
Lease
by reference and are to be construed as a
part of this Lease.
EXHIBIT A. Plan showing the
Premises.
EXHIBIT
A-1. Plan Showing Location of Tenant's Visitor Parking Spaces
EXHIBIT B.
Rules and Regulations.
EXHIBIT C.
Alterations Requirements.
EXHIBIT D.
Contractor's Insurance Requirements.
EXHIBIT E. Clerk's
Certificate.
EXHIBIT 1.
Shell and Core Work.
EXHIBIT 2.
Exterior Work.
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ARTICLE 2
Premises and Term
2.1 Premises. Landlord
hereby leases to Tenant and Tenant hereby leases
from Landlord, subject to and with the
benefit of the terms, covenants,
conditions and provisions of this Lease,
the Premises, excluding exterior faces
of exterior walls, the common lobbies,
hallways, stairways, stairwells, elevator
shafts and other common areas, and the
escalators, elevators, pipes, ducts,
conduits, wires and appurtenant fixtures
and other common facilities serving the
common areas, the Premises and the premises
of other tenants in the Building.
Tenant
shall have, as appurtenant to the Premises, rights to use, in
common with others, subject to reasonable
rules of general applicability to
tenants of the Building from time to time
made by Landlord of which Tenant is
given notice: (a) the common lobbies,
hallways and stairways and loading docks
of the Building, (b) the common escalators,
elevators, pipes, ducts, conduits,
wires and appurtenant fixtures and other
common facilities serving the Premises,
and (c) common walkways and driveways (if
any) necessary for access to the
Building.
2.2 Term.
The term of this Lease shall be for a period beginning on the
Commencement Date (as defined in Section
3.1) and continuing for the Original
Term and any extension of the term hereof
in accordance with the provision of
this Lease, unless sooner terminated as
hereinafter provided. When the dates of
the beginning and end of the Original Term
have been determined such dates shall
be evidenced by a document executed by
Landlord and Tenant and delivered each to
the other, but the failure of Landlord and
Tenant to execute or deliver such
document shall have no effect upon such
dates. The Original Term and any
extension of the term hereof in accordance
with the provisions of this Lease is
hereinafter referred to as the "term" of
this Lease.
2.3
Extension Option. So long as this Lease is still in full force
and
effect, and the named Tenant as set forth
in Section 1.1(or any successor by
merger, or any Affiliate) shall actually
occupy at least seventy percent (70%)
of the Premises, Tenant shall have the
right to extend the term of this Lease
for two (2) additional periods (the
"Extended Term(s)") of three (3) years each.
Each Extended Term shall commence on the
day succeeding the expiration of the
Original Term or the preceding Extended
Term, as the case may be, and shall end
on the day immediately preceding the third
anniversary of the commencement of
such Extended Term. All of the terms,
covenants and provisions of this Lease
applicable immediately prior to the
expiration of the then current term (i.e.
Original Term or Extended Term, as
applicable) shall apply to each such Extended
Term except that (i) the Annual Fixed Rent
for each such Extended Term shall be
ninety-five percent (95%) of the Market
Rate (as hereinafter defined) for the
Premises determined as of the commencement
of such Extended Term, as designated
by Landlord by notice to Tenant
("Landlord's Notice"), but subject to Tenant's
right to dispute as hereinafter provided;
and (ii) Tenant shall have no further
right to extend the term of this Lease
beyond the Extended Terms hereinabove
provided. If Tenant shall elect to exercise
any of the aforesaid options, it
shall do so by giving Landlord notice
("Tenant's Extension Notice") of its
election not later than one year, nor
sooner than eighteen (18) months, prior to
the expiration of the then current term of
this Lease (Original Term or Extended
Term, as applicable). If Tenant fails to
give any such notice to Landlord, the
term of this Lease shall automatically
terminate no
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later than the end of the term then in
effect, and Tenant shall have no further
option to extend the term of this Lease, it
being agreed that time is of the
essence with respect to the giving of any
such notice. If Tenant shall extend
the term hereof pursuant to the provisions
of this Section 2.3, such extension
shall be automatically effected without the
execution of any additional
documents, but Tenant shall, at Landlord's
request, execute an agreement
confirming the Annual Fixed Rent for the
applicable Extended Term.
"Market
Rate" shall mean the then fair market annual rental rate and
terms
for the Premises for the applicable period
(determined as set forth below).
Within thirty (30) days after Landlord's
receipt of a Tenant's Extension Notice,
Landlord shall provide Landlord's Notice.
Within thirty (30) days after Tenant's
receipt of Landlord's Notice, Tenant shall
either accept Landlord's
determination of the Market Rate or shall
propose its determination of the
Market Rate by providing notice to
Landlord. If Tenant disagrees with Landlord's
designation of the Market Rate, the parties
shall meet for the purpose of
reaching agreement. If the parties cannot
agree upon the Market Rate by the date
that is thirty (30) days following
Landlord's receipt of Tenant's proposal, then
the Market Rate shall be submitted to
appraisal as follows: Within fifteen (15)
days after the expiration of such thirty
(30) day period, Landlord and Tenant
shall designate a mutually acceptable
appraiser, or either party then may
request the American Arbitration
Association, Boston office (or any successor
organization) to designate an independent
appraiser in accordance with its then
prevailing rules.
Any
appraisers selected as herein provided shall have at least ten
(10)
years experience in the leasing, ownership
or management of 1,000,000 or more
square feet of floor area of properties of
the same type and quality as the
Building in the Route 128 market area. Each
party shall pay one half (1/2) of
the fees and expenses of the appraiser and
all other expenses of the appraisal.
The parties shall have the opportunity to
present evidence in accordance with
reasonable procedures prescribed by the
appraiser. The decision and award of the
appraiser shall be in writing and shall be
final and conclusive on all parties,
and counterpart copies thereof shall be
delivered to both Landlord and Tenant.
Judgment upon the award of the appraiser
may be entered in any court of
competent jurisdiction.
The
appraiser shall select the Market Rate determination of either
Landlord or Tenant that the appraiser
considers closest to his or her own
determination of the Market Rate of the
Premises for the applicable Extended
Term and render a decision and award as to
such determination to both Landlord
and Tenant (a) within twenty (20) days
after the appointment of the appraiser.
In rendering such decision and award, the
appraiser shall assume (i) that the
Premises are available in the then rental
market, (ii) that Landlord has had a
reasonable time to locate a tenant, (iii)
that neither Landlord nor the
prospective tenant is under a compulsion to
rent, (iv) that Landlord and Tenant
are typically motivated, well-informed and
well-advised, and each is acting in
what it considers its own best interest,
(v) the Premises are appropriate and
desired for immediate occupancy by Tenant
and contain no work that has been
carried out thereon by Tenant, its
subtenant(s), or its or their
successors-in-interest during the Term of
this Lease which has diminished the
rental value of the Premises, and (vi) that
in the event the Premises are
destroyed or damaged by fire or other
casualty prior to the commencement of the
applicable Extended Term, they have been
fully restored. In rendering such
decision and award, the appraiser shall
consider the fair market annual rents
(as the same may change over time and
considering any rent abatement or other
offset against stated annual rents) then
being charged for
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comparable space in comparable buildings
for the period of the applicable
Extended Term in the Route 128 market area,
but shall not modify the provisions
of this Lease.
If the
dispute between the parties as to the Market Rate has not been
resolved before the commencement of
Tenant's obligation to pay the Annual Fixed
Rent based upon determination of such
Market Rate, then Tenant shall pay the
Annual Fixed Rent under the Lease for the
annual period just ended until either
the agreement of the parties as to the
Market Rate, or the decision of the
appraiser(s), as the case may be, at which
time Tenant shall pay any
underpayment of the Annual Fixed Rent to
Landlord, or Landlord shall refund any
overpayment of the Annual Fixed Rent to
Tenant.
2.4
Measurement of the Premises and Building. Landlord shall cause
its
architect to determine the measurement of
the Premises and the Building in
accordance with the ANSI/BOMA Z65.1 1996
standards. Such measurement shall occur
only once, shall be made only after
reasonable prior notice to Tenant, and at
Tenant's request the architect shall meet
with Tenant or its architect to
provide any appropriate substantiation.
If the rentable area of the
Premises, as so measured, is different from
the Premises Rentable Area as set forth in
Section 1. 1, the definition of
Premises Rentable Area for all purposes
(e.g. Annual Fixed Rent, Landlord's
Contribution and the Applied Rent Amount)
shall be deemed amended in accordance
with such measurement, and if the Premises
Rentable Area as so measured is not
one-half of the rentable area of the
Building as so measured ("Building Rentable
Area"), Tenant's Percentage shall be
amended to be the ratio of the Premises
Rentable Areas as so measured to Building
Rentable Area, all retroactively to
the Commencement Date.
In the
event of any adjustment pursuant to this Section 2.3, Landlord
and
Tenant shall promptly execute a written
statement setting forth the recomputed
Premises Rentable Area and Tenant's
Percentage, but the failure by either party
to execute such a statement shall have no
effect on the validity of such
recomputation.
ARTICLE 3
Commencement and Condition
3.1
Commencement Date. The Commencement Date shall be the
Substantial
Completion Date, as defined in Section
3.2(c).
3.2
Preparation of the Premises.
(a) Landlord and Tenant shall adhere to any schedules for
submittals
and decisions reasonably established by The
Richmond Group to have final
construction drawings ("Tenant's Plans")
for the initial improvements to the
Premises completed on or before the Final
Plans Date.
(b) Landlord shall fill in the atrium on the second floor and
perform the alterations and improvements
described on Exhibit 1 (the "Shell and
Core Work") and shall perform the
alterations and improvements to the exterior
of the Building described on Exhibit 2 (the
"Exterior Work"). Landlord shall
cause the improvements to the second floor
lobby common
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area to be consistent with adjacent areas
of the Premises, and shall seek input
from Tenant regarding the Exterior Work
prior to Landlord finalizing plans
therefor.
Promptly
after approval by Landlord of Tenant's Plans, Landlord shall
also
perform the work specified therein (the
"Leasehold Improvement Work", and
together with the Shell and Core Work and
the Exterior Work, as may be modified
as hereinafter provided, "Landlord's
Work"); and Landlord shall use all
reasonable efforts to complete Landlord's
Work diligently, but Tenant shall have
no claim against Landlord or right to
terminate this Lease due to failure by
Landlord to complete Landlord's Work by any
given date, except as provided in
Section 3.4(d). Landlord shall enter into a
contract to perform the Leasehold
Improvement Work with The Richmond Group
provided that The Richmond Group shall
execute Landlord's standard form of
construction contract containing the
contractor's agreement to perform the
Leasehold Improvement Work in accordance
with Tenant's Plans and Landlord's
reasonable requirements, including, without
limitation, providing customary contractor
insurance and performance and payment
bonds and to substantially complete the
Leasehold Improvement Work not later
than August 31, 2005 (the "Target Delivery
Date"), subject to Force Majeure and
Tenant Delay, as hereinafter defined;
otherwise Landlord shall be free to select
the contractor to perform the Leasehold
Improvement Work on the foregoing terms.
Landlord
shall perform the Shell and Core Work and the Exterior Work at
its sole cost and expense, in a good and
workmanlike manner, using materials
that are new, commercial grade and of
first-class quality. Tenant agrees that
Landlord may make any changes in Landlord's
Work from that shown on Tenant's
Plans or the Exhibits to this Lease, the
necessity or desirability of which
becomes apparent following the Date of this
Lease, upon prior written notice to
Tenant for changes that are not substantial
(either individually or in the
aggregate) and do not increase the cost of
Landlord's Work (either individually
or in the aggregate) and with the approval
of Tenant (which approval shall not
be unreasonably withheld or delayed) for
all other changes. Landlord shall
provide Tenant with an allowance
("Landlord's Contribution") of One hundred
dollars ($100.00) per square foot of
Premises Rentable Area for the performance
of the Leasehold Improvement Work. To the
extent that the cost of the Leasehold
Improvement Work exceeds Landlord's
Contribution (such excess being the "Excess
Cost"), Tenant shall (at Landlord's
election) (i) pay fifty percent (50%) of the
Excess Cost (as estimated by Landlord) to
Landlord upon approval by Landlord of
Tenant's Plans and the remainder of such
Excess Cost within ten (10) days after
delivery to Tenant of a final accounting of
the cost of the Leasehold
Improvement Work, or (ii) pay the entire
Excess Cost within ten (10) days after
delivery to Tenant of a final accounting of
the cost of Leasehold Improvement
Work. For purposes of this subsection (b),
"cost" shall be the actual cost to
Landlord of performing the Leasehold
Improvement Work including, without
limitation, all architectural and
engineering fees and expenses in preparing
Tenant's Plans or otherwise and all filing
fees and other permitting costs and
all contractor charges ("Contractor
Charges") for the cost of work and
materials, profit, general conditions and
overhead and supervision, plus five
percent (5%) of Contractor Charges as a fee
for administering the Leasehold
Improvement Work on behalf of Landlord.
Tenant shall, if requested by Landlord,
execute an agreement (the "Excess Cost
Amendment") confirming Landlord's
estimate of such Excess Cost, and (subject
to Landlord's obligation to
substantiate the actual Excess Cost
following completion of Landlord's Work)
Tenant's obligation on account thereof
within five (5) Business Days after
Landlord's request therefor.
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(c) The "Substantial Completion Date" shall be the first day as
of
which Landlord's Work has been completed
except for items of work (and, if
applicable, adjustment of equipment and
fixtures) which can be completed after
occupancy has been taken without causing
undue interference with Tenant's use of
the Premises (i.e. so-called "punch list"
items), and a temporary or permanent
certificate of occupancy has been issued.
Landlord shall complete as soon as
conditions permit all "punch list" items
and Tenant shall afford Landlord access
to the Premises for such purposes.
3.3
Conclusiveness of Landlord's Performance. Tenant shall be
conclusively
deemed to have accepted Landlord's Work
unless, within ten (10) months after the
Commencement Date with regard to heat,
ventilation and air-conditioning
equipment and related work or within ninety
(90) days after the Commencement
Date with regard to other items, Tenant
gives Landlord a notice setting forth in
detail those portions of Landlord's Work
Tenant does not accept. Upon Tenant's
request, Landlord shall assign to Tenant
any warranties provided to Landlord in
connection with Landlord's Work which are
assignable without expense to Landlord
provided Tenant shall release Landlord from
any liability with respect to the
matter subject to the warranty.
3.4 Tenant
Delay; Force Majeure. A "Tenant Delay" shall be any delay in
the occurrence of the Substantial
Completion Date as a result of a Direct Delay
(as defined in Section 3.4 (a)), plus any
delay in the occurrence of the
Substantial Completion Date as a result of
an Additional Delay (as defined in
Section 3.4(b)). Tenant shall pay to
Landlord (as Additional Rent), for each day
of Tenant Delay, the amount of Annual Fixed
Rent, Additional Rent and other
charges that would have been payable
hereunder as if the Rent Commencement Date
occurred, and the obligation to pay the
full amount of Annual Fixed Rent,
Additional Rent and other charges (without
abatement) had commenced, immediately
prior to such Tenant Delay.
(a) A "Direct Delay" shall be any of the following:
(i) any request
by Tenant that Landlord delay in the
commencement or completion of the Leasehold Improvement
Work or any other portions of Landlord's Work for any
reason (other than as a result of Landlord's failure to
perform its obligations under this Lease);
(ii) Tenant's failure
to submit Tenant's Plans by the Plan
Submission Date, or to obtain Landlord's approval
thereof by the Final Plans Date, or to execute the
Excess Cost Agreement if requested by Landlord or to pay
when due any Excess Cost;
(iii) any request by Tenant for any change in any of Tenant's
Plans after the Final Plans Date;
(iv) any requirement
of Tenant's Plans identified by Landlord
at time of Landlord's approval of Tenant's Plans as a
long lead item; or
(v) any other act or omission of
Tenant or its officers,
agents, servants or contractors (including unreasonable
delay or withholding of
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approval to changes
desired by Landlord and which
require Tenant's approval, as described in Subsection
3.2(b)).
(b) An "Additional Delay" shall be (i) any reasonably necessary
change in Landlord's construction schedule
resulting from a Direct Delay or (ii)
any "Force Majeure" condition (as defined
in subsection (e) hereof) which would
have occurred after the Substantial
Completion Date but for a Direct Delay.
(c) If, as a result of a Tenant Delay, the Substantial
Completion
Date is delayed in the aggregate for more
than ninety (90) days, Landlord may
(but shall not be required to) at any time
thereafter terminate this Lease by
giving notice of such termination to Tenant
and thereupon this Lease shall
terminate without further liability or
obligation on the part of either party,
except that Tenant shall pay to Landlord
the cost theretofore incurred by
Landlord in performing Landlord's Work,
plus an amount equal to Landlord's
out-of-pocket expenses incurred in
connection with this Lease, including,
without limitation, brokerage and legal
fees, together with any amount required
to be paid pursuant to this Section 3.4
through the date of termination. If as a
result of Force Majeure the Substantial
Completion Date is delayed for more than
six (6) months, Landlord may (but shall not
be required to) at any time
thereafter terminate this Lease by giving
notice of such termination to Tenant
and thereupon this Lease shall terminate
without further liability or obligation
on the part of either party.
(d) Landlord shall comply with all of its obligations and
enforce
all of its rights under the contract it
shall execute for the performance of
Landlord's Work. If nevertheless the
Substantial Completion Date has not
occurred within ninety (90) days after the
Target Delivery Date (as it may be
extended pursuant to Section 3.4), Tenant
shall have the right to terminate this
Lease by giving notice to Landlord not
later than thirty (30) days after the
expiration of such ninety (90) day period;
and this Lease shall cease and come
to an end without further liability or
obligation on the part of either party
(except, if applicable, for any
undischarged obligations of Tenant arising
pursuant to Section 3.7, which obligations
shall remain in effect) on the giving
of such notice, it being agreed that time
is of the essence with respect to the
giving of such notice. Tenant's termination
right shall be Tenant's sole and
exclusive remedy at law or in equity for
Landlord's failure to complete
Landlord's Work.
(e) "Force Majeure" shall be defined as any strike or other
labor
trouble, fire, flood or other casualty,
breakage, accident, repairs, unusually
severe weather, governmental preemption of
priorities or other controls in
connection with a national or other public
emergency, governmental moratoria, or
inaction of governmental authority (or
shortages of fuel, supplies or labor
resulting therefrom), war, civil commotion,
labor or transportation
difficulties, inability to obtain supplies,
or any other cause, whether similar
or dissimilar, beyond Landlord's reasonable
control.
(f) The Target Delivery Date shall be extended by the number of
days
of delay due to any Tenant Delay or Force
Majeure.
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3.5
Construction Representatives. Both Landlord and Tenant shall
appoint
one individual as its "Construction
Representative" who is authorized to act on
its behalf in connection with any matters
arising pursuant to this Article 3.
The Construction Representative may be
changed from time to time by notice
hereunder from the then current
Construction Representative to the other party's
Construction Representative or by notice
from Landlord or Tenant pursuant to
Section 10.1. The initial Construction
Representatives shall be Michael Marx
(Landlord) and Christine H. Wang (Tenant).
Notwithstanding Section 10.1, any
notices or other communication under this
Article 3 may be made by letter or
other writing sent by U.S. mail, facsimile
or email, provided the communication
is made by one party's Construction
Representative to the other party's
Construction Representative.
3.6
Application of Remaining Contribution. To the extent the cost of
the
Leasehold Improvement Work shall be less
than Landlord's Contribution, Tenant
may apply such difference (the
"Difference") toward the following (the
"Associated Costs"): (i) architectural
services incurred by Tenant in preparing
Tenant's Plans (including any amounts
incurred prior to the Date of this Lease),
(ii) construction management services
incurred by Tenant in connection with the
Leasehold Improvement Work, (iii) costs
incurred by Tenant to install in the
Premises any "work" as defined in Section
6.2.5 of this Lease including lab
benches and fixtures, (iv) costs (including
reasonable third party relocation
management fees) incurred by Tenant in
moving from 10K Gill Street to the
Premises, (v) costs incurred by Tenant to
install telephone, data and electrical
cabling and wiring in the Premises and (vi)
up to $100,000 of costs incurred by
Tenant to purchase new office furniture;
and to the extent of the remaining
Difference, Landlord shall reimburse Tenant
for such expenses within thirty (30)
days of receipt of request therefor
together with paid invoices, and provided
that there shall exist no Default of Tenant
and such invoices are delivered to
Landlord prior to the first anniversary of
the Commencement Date.
To the
extent the cost of the Leasehold Improvement Work plus any
amounts
paid by Landlord toward the Associated
Costs shall be less than Landlord's
Contribution, up to the Applied Rent Amount
of such remaining difference may be
applied to the first installment(s) of
Annual Fixed Rent due hereunder, provided
Tenant shall elect to make such application
by notice to Landlord on or before
the Rent Commencement Date. The "Applied
Rent Amount" is $5.00 per square foot
of Premises Rentable Area.
Should
there remain any portion of Landlord's Contribution that shall
not
have been applied toward the cost of the
Leasehold Improvement Work, the
Associated Costs or application against
Annual Fixed Rent as provided in the
previous paragraph, such remaining portion
shall be available to reimburse
Tenant for any "work" as defined in Section
6.2.5 of this Lease performed to the
Premises in compliance with the terms of
this Lease, further provided that there
shall exist no Default of Tenant and
provided paid invoices for such work are
provided to Landlord on or before the
fourth anniversary of the Commencement
Date.
Any
portion of Landlord's Contribution not applied toward the cost of
the
Leasehold Improvement Work, the Associated
Costs, credit against Annual Fixed
Rent or work, as described in the three
preceding paragraphs, shall be forfeited
by Tenant and shall become Landlord's
property.
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3.7 Early
Access. Landlord acknowledges that Tenant desires to occupy a
portion of the Premises of approximately
five thousand (5,000) rentable square
feet as soon as possible after May 31,
2005, irrespective of the fact that the
Commencement Date may not have occurred.
Landlord therefore agrees that, at such
point as, in Landlord's reasonable
judgment, Landlord's Work has proceeded to
such point where Tenant may, in compliance
with applicable law and building
codes, occupy such portion as desired by
Tenant without interfering with the
performance of Landlord's Work, Tenant may
occupy such portion of the Premises
for the Permitted Uses. In connection with
such access, Tenant agrees to cease
promptly upon notice from Landlord any
activity (including mere possession of
such area) which shall interfere with or
delay the performance of Landlord's
Work. Such access by Tenant shall be deemed
to be subject to all of the
applicable provisions of this Lease, except
that the Commencement Date shall not
be deemed to have occurred but Tenant shall
pay rent monthly in advance during
such pre-Commencement Date period at a per
annum rate of $16.25 per rentable
square foot so occupied. If Tenant fails or
refuses to comply with any of the
obligations described or referred to above,
then immediately upon notice to
Tenant, Landlord may revoke Tenant's rights
of access to the Premises until the
Commencement Date.
ARTICLE 4
Rent, Additional Rent, Insurance and Other Charges
4.1 The
Annual Fixed Rent. Commencing on that date (the "Rent
Commencement
Date") which is two (2) months following
the Commencement Date, Tenant shall pay
Annual Fixed Rent to Landlord, or as
otherwise directed by Landlord, without
offset, abatement (except as provided in
Article 7), deduction or demand. Annual
Fixed Rent shall be payable in equal
monthly installments, in advance, on the
first day of each and every calendar month
after the Rent Commencement Date and
during the term of this Lease, at the
Original Address of Landlord, or at such
other place as Landlord shall from time to
time designate by notice, by check
drawn on a domestic bank.
Annual
Fixed Rent for any partial month shall be prorated on a daily
basis, and if Annual Fixed Rent commences
on a day other than the first day of a
calendar month, the first payment which
Tenant shall make to Landlord shall be
payable on the date Annual Fixed Rent
commences and shall be equal to such
pro-rated amount plus the installment of
Annual Fixed Rent for the succeeding
calendar month. Annual Fixed Rent for any
month during which Annual Fixed Rent
shall increase after the first day of such
month shall be the sum of similarly
pro-rated amounts for both the period prior
to such change and the period from
and after such change.
4.2
Additional Rent. Tenant covenants and agrees to pay Tenant's
Percentage of Taxes and Operating Costs as
provided in Sections 4.2.1 and 4.2.2,
and all other charges and amounts payable
by or due from Tenant to Landlord (all
such amounts referred to in this sentence
being "Additional Rent").
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<PAGE>
4.2.1 Real Estate Taxes. Tenant shall pay to Landlord, as
Additional
Rent, Tenant's Percentage of Taxes (as
hereinafter defined) assessed against the
Property (or estimated to be due by
governmental authority) for any fiscal tax
period (a "Tax Year") during the term of
this Lease (Tenant's Percentage of
Taxes being "Tenant's Tax Obligation").
Upon the request of Tenant, Landlord
shall deliver to Tenant copies of all
applicable tax bills and the calculation
of Tenant's Tax Obligation. Except as
otherwise provided in the immediately
following paragraph, Tenant shall pay
Tenant's Tax Obligation to Landlord at
least thirty (30) days prior to the date or
dates within any year during the
term hereof that the same, or any
fractional share thereof, shall be due and
payable to any governmental authority
responsible for collection of same (as
stated in a notice to Tenant given at least
thirty (30) days prior to the date
or dates any such payment shall be due,
which notice shall set forth the manner
of computation of Tenant's Tax Obligation
due from Tenant), except that such
payment shall be made to Landlord not later
than thirty (30) days after such
notice to Tenant, if such notice is given
subsequent to the date thirty (30)
days prior to the date the same is due and
payable as aforesaid.
Tenant
shall pay to Landlord, as Additional Rent on the first day of
each
calendar month during the term but
otherwise in the manner provided for the
payment of Annual Fixed Rent, estimated
payments on account of Tenant's Tax
Obligation, such monthly amounts to be
sufficient to provide Landlord by the
time Tax payments are due or are to be made
by Landlord a sum equal to Tenant's
Tax Obligation, as reasonably estimated by
Landlord from time to time on account
of Taxes for the then current Tax Year. If
the total of such monthly remittances
for any Tax Year is greater than Tenant's
Tax Obligation for such Tax Year,
Landlord shall credit such overpayment
against Tenant's subsequent obligations
on account of Taxes (or promptly refund
such overpayment if the term of this
Lease has ended and Tenant has no further
obligations to Landlord); if the total
of such remittances is less than Tenant's
Tax Obligation for such Tax Year,
Tenant shall pay the difference to Landlord
within thirty (30) days after being
so notified by Landlord.
If, after
Tenant shall have made all payments due to Landlord pursuant to
this subsection 4.2.1, Landlord shall
receive a refund of any portion of Taxes
as a result of an abatement of such Taxes
by legal proceedings, settlement or
otherwise, Landlord shall credit to
Tenant's subsequent obligations on account
of Taxes (or promptly refund such
overpayment if the term of this Lease has
ended and Tenant has no further obligations
to Landlord) Tenant's Percentage of
that percentage of the refund (after first
deducting any reasonable expenses,
including attorneys', consultants' and
appraisers' fees, incurred in connection
with obtaining any such refund) which
equals the percentage of the applicable
Tax Year included in the term hereof. In
addition to Tenant's rights pursuant to
Mass. Gen Laws Ann. c. 59 Section 59, from
time to time, Landlord, in its
reasonable discretion, shall make
commercially reasonable efforts to challenge
obvious and materially unfair assessments
of Taxes by contesting or objecting to
increases in the determination of the fair
market value of the Property.
In the
event that the Commencement Date shall occur or the term of
this
Lease shall expire or be terminated during
any Tax Year, or should the Tax Year
or period of assessment of real estate
taxes be changed or be more or less than
one (1) year, or should Tenant's Percentage
be modified during any Tax Year due
to a change in the rentable area of the
Building and/or the
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Premises or otherwise, as the case may be,
then the amount of Tenant's Tax
Obligation which may be otherwise payable
by Tenant as provided in this
subsection 4.2.1 shall be pro-rated on a
daily basis based on a 365 day Tax
Year.
"Taxes"
shall mean all taxes, assessments, excises and other charges
and
impositions (including penalties and
interest only to the extent due to Tenant's
failure to make payments in accordance with
this Section 4.2. 1) which are
general or special, ordinary or
extraordinary, foreseen or unforeseen, of any
kind or nature which are levied, assessed
or imposed at any time during the term
by any governmental authority upon or
against or with respect to the Property,
Landlord or the owner or lessee of personal
property used by or on behalf of
Landlord in connection with routine
maintenance and operation of the Property,
or taxes in lieu thereof, and additional
types of taxes to supplement real
estate taxes due to legal limits imposed
thereon. If, at any time during the
term of this Lease, any tax or excise on
rents or other taxes, however
described, are levied or assessed against
Landlord, either wholly or partially
in substitution for, or in addition to,
real estate taxes assessed or levied on
the Property, such tax or excise on rents
or other taxes shall be included in
Taxes; however, Taxes shall not include
franchise, estate, inheritance,
succession, capital levy, income (except to
the extent that a tax on income or
revenue is levied solely on rental revenues
and not on other types of income and
then only from rental revenue generated by
the Property) or excess profits taxes
assessed on Landlord. Taxes also shall
include all court costs, attorneys',
consultants' and accountants' fees, and
other expenses incurred by Landlord
contesting Taxes through and including all
appeals. Taxes shall include any
estimated payment made by Landlord on
account of a fiscal tax period for which
the actual and final amount of taxes for
such period has not been determined by
the governmental authority as of the date
of any such estimated payment.
4.2.2 Operating Costs. Tenant shall pay to Landlord, as
Additional
Rent, Tenant's Percentage of Operating
Costs (as hereinafter defined) paid or
incurred by Landlord with respect to the
Property in any twelve-month period
established by Landlord (an "Operating
Year") during the term of this Lease.
Except as otherwise provided in the
immediately following paragraph Tenant shall
pay Tenant's Percentage of Operating Costs
("Tenant's Operating Cost
Obligation") to Landlord within twenty (20)
days from the date Landlord shall
furnish to Tenant an itemized statement
thereof, prepared, allocated and
computed in accordance with then prevailing
customs and practices of the real
estate industry, consistently applied. Any
year-end statement by Landlord
relating to Operating Costs (other than an
invoice for a monthly estimate) shall
be final and binding upon Tenant unless it
shall within thirty (30) days after
receipt thereof, contest any item therein
by giving notice to Landlord
specifying each item contested and the
reasons therefor.
Tenant
shall pay to Landlord, as Additional Rent on the first day of
each
calendar month during the term but
otherwise in the manner provided for the
payment of Annual Fixed Rent, estimated
payments on account of Tenant's
Operating Cost Obligation, such monthly
amounts to be sufficient to provide to
Landlord, by the end of each Operating
Year, a sum equal to the Tenant's
Operating Cost Obligation for such
Operating Year, as reasonably estimated by
Landlord from time to time during such
Operating Year. If, at the expiration of
each Operating Year in respect of which
monthly installments of Operating Cost
Obligation shall have been made as
aforesaid, the total of such monthly
remittances is greater than the Tenant's
Operating Cost Obligation for such
Operating Year, Landlord shall credit such
overpayment against
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Tenant's subsequent obligations on account
of Operating Costs (or promptly
refund such overpayment if the term of this
Lease has ended and Tenant has no
further obligation to Landlord); if the
total of such remittances is less than
the Operating Cost Obligation for such
Operating Year, Tenant shall pay the
difference to Landlord within ten (10) days
after being so notified by Landlord.
In the
event that the Commencement Date shall occur or the term of
this
Lease shall expire or be terminated during
any Operating Year or Tenant's
Percentage shall be modified during any
Operating Year due to a change in the
rentable area of the Building and/or the
Premises or otherwise, as the case may
be, then the amount of Tenant's Operating
Cost Obligation which may be payable
by Tenant as provided in this subsection
4.2.2 shall be pro-rated on a daily
basis based on a 365 day Operating
Year.
"Operating
Costs" shall include all costs and expenses reasonably paid or
incurred for the operation, cleaning,
management, maintenance, repair, upkeep
and security of the Property, including,
without limitation:
(a) all salaries, wages, fringe benefits, payroll taxes and
workmen's compensation insurance premiums
related thereto and all other costs
paid or incurred with respect to employment
of personnel engaged in operation,
administration, cleaning, maintenance,
repair, upkeep and security of the
Property including, without limitation,
supervisors, property managers,
accountants, bookkeepers, janitors,
carpenters, engineers, mechanics,
electricians and plumbers;
(b) all utilities and other costs related to provision of heat
(including oil, steam and/or gas),
electricity, air conditioning, and water
(including sewer charges) and other
utilities to the Property (exclusive of
reimbursement to Landlord for any of same
received as a result of direct billing
to any tenant of the Building);
(c) all costs, including supplies, material and equipment costs,
for
cleaning and janitorial services to the
common areas of the Property (including,
without limitation, exterior window
cleaning), and interior and exterior
landscaping and pest control;
(d) the cost of replacements for tools and other similar
equipment
used in the repair, maintenance, cleaning
and protection of the Property,
provided that, in the case of any such
equipment used jointly on other property
of Landlord, such costs shall be suitably
prorated among the Property and such
other properties;
(e) all costs and premiums for fire, casualty, rental income,
liability and such other insurance as may
be maintained reasonably from time to
time by Landlord relating to the
Property;
(f) all costs of maintaining, repairing, decorating, operating,
administering, inspecting and protecting
the Property (including, without
limitation, lighting, installation,
maintenance, repair and alteration of signs,
snow removal on the Property and adjacent
walks and ways, paving, patching and
restriping of parking areas and operation,
maintenance, replacement and repair
of heating, ventilating and air
conditioning equipment, fire protection and
security systems, elevators, roofs, parking
areas and any other common Building
equipment,
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<PAGE>
systems or facilities), and all costs of
structural and other repairs and
replacements (other than repairs for which
Landlord has received full
reimbursement from contractors, other
tenants of the Building or from others)
necessary to keep the Property in good
working order, repair, appearance and
condition;
(g) costs of compliance with any laws, rules, regulations,
ordinances, agreements or standards
applicable to the Building or the Property,
which conformance is not the responsibility
of any tenant of the Building, and
which Landlord elects or is required to
perform, and costs of testing and
monitoring for any Hazardous Materials (as
defined in Section 6.2.8) in the
Building or Property, which is not the
responsibility of any tenant of the
Building, and which Landlord elects to
perform;
(h) all costs incurred in connection with the administration
and
supervision of all matters referred to in
items (a) through (g) hereof and in
performing Landlord's obligations under
Article 5, including Landlord's office
overhead costs provided that, if any such
administrative or supervisory
personnel are also employed on other
property of Landlord, such cost of
compensation shall be suitably prorated
among the Property and such other
properties;
(i) payments under all service contracts relating to matters
referred to in Items (a) through (h)
hereof;
(j) a management fee of three percent (3%) of gross rents payable
by
tenants of the Property; and
(k) reasonable attorney's fees and disbursements (exclusive of
any
such fees and disbursements incurred in tax
abatement proceedings or in the
preparation of leases) and auditing and
other professional fees and expenses.
If, after
twenty-four months after the Commencement Date and during the
term of this Lease, Landlord shall make any
capital expenditure, the total cost
of which is not included in Operating Costs
for the Operating Year in which it
was made, Landlord may include in Operating
Costs for the Operating Year in
which such expenditure was made and in
Operating Costs for each succeeding
Operating Year an annual charge-off of such
capital expenditure. Annual
charge-offs shall be equal to the level
payments of principal and interest
necessary to amortize the original capital
expenditure over the useful life of
the improvement, repair, alteration or
replacement made with the capital
expenditure using an interest rate
reasonably determined by Landlord as being
the interest rate being charged at the time
of the original capital expenditure
for long-term mortgages by institutional
lenders on like properties; and the
useful life shall be determined reasonably
by Landlord in accordance with then
prevailing customs and practices of the
real estate industry, consistently
applied.
Notwithstanding any other contrary provision, Operating Costs shall
not
include:
(i) the cost of
any additions or expansions to the rentable
areas of the Property;
(ii) any leasehold
improvements performed to any premises
intended to be occupied by individual tenants;
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<PAGE>
(iii) any reserves for future expenditures not yet incurred;
(iv) ground lease
rental;
(v) costs
incurred by Landlord for repair or restoration to
the extent that Landlord is reimbursed by insurance or
condemnation proceeds or that the same is covered by
warranty;
(vi) attorneys' fees,
leasing commissions and other costs and
expenses incurred in connection with negotiations or
disputes with present or prospective tenants or other
occupants of, or persons, firms or entities with respect
to, the Property;
(vii) expenses in connection with services or benefits that
are not offered to Tenant;
(viii) costs incurred by Landlord due to the negligence or
misconduct (including any violation of law) of Landlord
or its agents, contractors, licensees and employees or
the violation by Landlord or any tenants or other
occupants of the terms and conditions of any lease of
space or other agreements including this Lease;
(ix)
interest, principal,
points and fees on debts or
amortization on any mortgage or mortgages or any other
debt instrument encumbering all or any portion of the
Property;
(x) all items
and services for which Tenant or any other
tenant reimburses Landlord or that Landlord provides
exclusively to one or more tenants (other than Tenant)
but not all tenants;
(xi) advertising and
promotional expenditures in connection
with leasing the Property;
(xii) electric power and any other utility costs for which any
tenant or occupant directly contracts with the local
public service company;
(xiii) any costs relating to clean-up of hazardous materials,
asbestos and the like;
(xiv) any charges for depreciation of the Building, fixtures
or otherwise; and
(xv) the cost of any
electric current or other utility
furnished to any leasable area of the Building.
In
addition, if during any portion of any Operating Year for which
Operating Costs are being computed, less
than ninety-five percent (95%) of the
rentable area of the Building was leased to
tenants or if Landlord is supplying
less than ninety-five percent (95%) of the
rentable
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<PAGE>
area of the Building with the services and
utilities being supplied hereunder,
Landlord may, at its option, reasonably
project, on an item-by-item basis, the
Operating Costs that would have been
incurred if ninety-five percent (95%) of
the Building were occupied for such
Operating Year and such services and
utilities were being supplied to
ninety-five percent (95%) of the rentable area
of the Building, and such projected amount
shall, for the purposes hereof, be
deemed to be the Operating Costs for such
Operating Year.
4.3
Personal Property and Sales Taxes. Tenant shall pay all taxes
charged,
assessed or imposed upon the personal
property of Tenant and all taxes on the
sales of services or inventory, merchandise
and any other goods by Tenant in or
upon the Premises.
4.4
Insurance. Tenant shall, at its expense, take out and maintain,
throughout the tenor of this Lease, the
following insurance:
4.4.1 Commercial general liability insurance (on an occurrence
basis
and on a 1988 ISO CGL form or its
equivalent, including without limitation,
broad form contractual liability, bodily
injury, property damage, fire legal
liability, and products and completed
operations coverage) under which Tenant is
named as an insured and Landlord and Reit
Management and Research LLC (and the
holder of any mortgage on the Premises or
Property, as set out in a notice from
time to time) are named (on an ISO Form
20226 or as otherwise acceptable to
Landlord) as additional insureds as their
interests may appear, in an amount
which shall, at the beginning of the term,
be at least equal to the Commercial
General Liability Insurance Limits, and,
which, from time to time during the
term, shall be for such higher limits, if
any, as Landlord shall reasonably
determine to be customarily carried in the
area in which the Premises are
located at property comparable to the
Premises and used for similar purposes;
Worker's
compensation insurance with statutory limits covering all of
Tenant's employees working on the Premises;
and
So-called
"special form" property insurance on a "replacement cost" basis
with an agreed value endorsement covering
all furniture, furnishings, fixtures
and equipment and other personal property
brought to the Premises by Tenant and
all improvements and betterments to the
Premises performed at Tenant's expense.
4.4.2 All such policies shall contain deductibles not in excess
of
that reasonably approved by Landlord, shall
contain a clause confirming that
such policy and the coverage evidenced
thereby shall be primary with respect to
any insurance policies carried by Landlord
and shall be obtained from
responsible companies qualified to do
business and in good standing in the state
or district in which the Property is
located, which companies shall have a
general policy holder's rating of at least
A and a financial class of at least
VIII by A.M. Best Company, Inc.. A copy of
each paid-up policy evidencing such
insurance (appropriately authenticated by
the insurer) or a certificate (on
ACORD Form 27 or its equivalent) of the
insurer, certifying that such policy has
been issued and paid in full, providing the
coverage required by this Section
and containing provisions specified herein,
shall be delivered to Landlord prior
to the commencement of the term of this
Lease and, upon renewals, not less than
three (3) days prior to the expiration of
such coverage. Each such policy shall
be non-cancelable and not materially
changed with respect to the interest of
Landlord and such mortgagees of the
Property (and others
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that are in privity of estate with Landlord
of which Landlord provides notice to
Tenant from time to time) without at least
thirty (30) days' prior written
notice thereto. Any insurance required of
Tenant under this Lease may be
furnished by Tenant under a blanket policy
carried by it provided that such
blanket policy shall reference the
Premises, and shall guarantee a minimum limit
available for the Premises equal to the
insurance amounts required in this
Lease. Landlord may, at any time, and from
time to time, inspect and/or copy any
and all insurance policies required to be
procured by Tenant hereunder.
4.4.3 Landlord
and Tenant shall each endeavor to secure an
appropriate clause in, or an endorsement
upon, each property damage insurance
policy obtained by it and covering the
Building, the Premises or the personal
property, fixtures and equipment located
therein or thereon, pursuant to which
the respective insurance companies waive
subrogation and permit the insured,
prior to any loss, to agree with a third
party to waive any claim it might have
against said third party. The waiver of
subrogation or permission for waiver of
any claim hereinbefore referred to shall
extend to the agents of each party and
its employees and, in the case of Tenant,
shall also extend to all other persons
and entities occupying or using the
Premises by, through or under Tenant. If and
to the extent that such waiver or
permission can be obtained only upon payment
of an additional charge then the party
benefiting from the waiver or permission
shall pay such charge upon demand, or shall
be deemed to have agreed that the
party obtaining the insurance coverage in
question shall be free of any further
obligations under the provisions hereof
relating to such waiver or permission
from such insurance companies.
Subject to
the foregoing provisions of this Subsection 4.4.3, and insofar
as may be permitted by the terms of the
insurance policies carried by it, each
party hereby releases the other with
respect to any claim which it might
otherwise have against the other party for
any loss or damage, excluding any
deductible amounts, to the extent such
damage is actually covered or would have
been covered by policies of insurance
required by this Lease to be carried by
the respective parties hereunder. In
addition, Tenant agrees to exhaust any and
all claims against its insurer(s) prior to
commencing an action against Landlord
for any property loss.
4.5
Utilities. Tenant shall pay all charges related to the supply
of
electricity and natural gas to the
Premises, whether designated as a charge,
tax, assessment, fee or otherwise, all such
charges to be paid as the same from
time to time become due. Except as
otherwise provided in this Subsection 4.5 or
in Article 5, it is understood and agreed
that Tenant shall make its own
arrangements for the installation or
provision of all utilities and services and
that Landlord shall be under no obligation
to furnish any utilities to the
Premises.
Tenant
acknowledges that Annual Fixed Rent does not include the cost
of
supplying electricity or water and sewer
service to the Premises. If the utility
serving the Premises shall agree to
separate metering, electricity usage shall
be separately metered (and the cost of
installing such separate metering shall
be included as part of the Shell and Core
Work) and Tenant shall pay all bills
for the supply of electricity to the
Premises during the term of this Lease
directly to the utility company furnishing
the same. If such separate metering
is not available with respect to the
Premises, then Tenant shall, during such
portion of the term as such separate
metering is not in effect, pay as
Additional Rent all cost of electricity
supplied to the Premises as determined
in good faith by Landlord by submetering or
similar device and the cost of
operating, maintaining and repairing (but
not installing, which shall be done as
part of the
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Shell and Core Work, if applicable) any
meter or other device used to measure
Tenant's electrical consumption and any
cost incurred by Landlord in keeping
account of or determining Tenant's
electrical consumption. Tenant shall pay as
Additional Rent all cost of water and sewer
service for the Premises during the
term as determined by Landlord by
submetering or other similar device and the
cost of operating, maintaining and
repairing (but not installing, which shall be
done as part of the Shell and Core Work)
any meter or other device used to
measure water consumption and any cost
incurred by Landlord in keeping account
of or determining Tenant's water
consumption. Alternatively, at Landlord's
option, Tenant shall pay Tenant's
Percentage of the charges for electricity
service and/or the charges for water and
sewer service during the term allocable
to those portions of the Building leased or
intended to be leased to tenants,
within ten days of invoice therefor,
provided however if some or all of the
areas leased or intended to be leased to
tenants are separately metered for
electricity and/or water, such Tenant's
Percentage for purposes of this
Subsection 4.5 only shall be determined by
dividing the rentable area of the
Premises by the rentable area of the
portions of the Building not separately
metered for such service.
4.6 Late
Payment of Rent. If any installment of Annual Fixed Rent or any
Additional Rent is not paid on or before
the date the same is due, it shall bear
interest (as Additional Rent) from the date
due until the date paid at the
Default Rate (as defined in Section 8.4).
In addition, if any installment of
Annual Fixed Rent or Additional Rent is
unpaid for more than ten (10) days after
the date due, Tenant shall pay to Landlord
a late charge equal to the greater of
One Hundred Dollars ($100) or three percent
(3%) of the delinquent amount. The
parties agree that the amount of such late
charge represents a reasonable
estimate of the cost and expense that would
be incurred by Landlord in
processing and administration of each
delinquent payment by Tenant, but the
payment of such late charges shall not
excuse or cure any default by Tenant
under this Lease. Absent specific provision
to the contrary, all Additional Rent
shall be due and payable in full ten (10)
days after demand by Landlord.
4.7
Security Deposit. Upon execution of this Lease, Tenant shall
deposit
with Landlord the Security Deposit. The
Security Deposit shall be held by
Landlord as security for the faithful
performance of all the terms of this Lease
to be observed and performed by Tenant. The
Security Deposit shall not be
mortgaged, assigned, transferred or
encumbered by Tenant and any such act on the
part of Tenant shall be without force and
effect and shall not be binding upon
Landlord. Tenant shall cause the Security
Deposit to be maintained throughout
the term in the amount set forth in Section
1.1, subject to reduction as
hereinafter provided. The Security Deposit
shall be reduced to $350,000 as of
the first anniversary of the Rent
Commencement Date, to $250,000 as of the
second anniversary of the Rent Commencement
Date, to $150,000 as of the third
anniversary of the Rent Commencement Date,
and to $100,000 as of the fourth
anniversary of the Rent Commencement Date;
provided, however, that no reduction
in the Security Deposit shall occur once
there shall have existed a Default of
Tenant as defined in Section 8.1.
Tenant
shall have the right to post the Security Deposit in the form of
a
letter of credit (the "Letter of Credit"),
which shall (a) be unconditional and
irrevocable and otherwise in form and
substance reasonably satisfactory to
Landlord; (b) permit multiple draws; (c) be
issued by a commercial bank
reasonably acceptable to Landlord from time
to time; (d) be made payable to, and
expressly transferable and assignable at no
charge by, Landlord but only to the
holder from
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time to time of the interest of Landlord
under this Lease (and if the issuer
shall impose a charge for transfer, Tenant
shall pay such charge); (e) be
payable at sight upon presentment of a
sight draft accompanied by a certificate
of Landlord stating either that Tenant is
in default under this Lease or that
Landlord is otherwise permitted to draw
upon such Letter of Credit under the
express terms of this Lease, and the amount
that Landlord is owed (or is
permitted to draw) in connection therewith;
and (f) either expire not earlier
than ninety (90) days following the
expiration of the tern of this Lease, or be
replaced not less than thirty (30) days
prior to the expiration of the then
current Letter of Credit so that the
original Letter of Credit or a replacement
thereof shall be in full force and effect
throughout the term of this Lease and
for a period of at least ninety (90) days
thereafter. Tenant shall maintain the
Letter of Credit in the amount of the
Security Deposit as the same may be
reduced as provided above and shall deliver
to Landlord any replacement Letter
of Credit not less than thirty (30) days
prior to the expiration of the then
current Letter of Credit. Any reduction in
the amount of the Letter of Credit
may be accomplished by Landlord's surrender
of the existing Letter of Credit in
return for Landlord's contemporaneous
receipt of a new Letter of Credit in the
lower amount. Notwithstanding anything in
this Lease to the contrary, any grace
period or cure periods which are otherwise
applicable under Section 8.1 hereof,
shall not apply to any of the foregoing,
and, specifically, if Tenant fails to
comply with the requirements of subsection
(f) above or if Tenant shall fail to
maintain the Letter of Credit in the full
amount of the Security Deposit after
any draw thereon by Landlord,. Landlord
shall have the immediate right to draw
upon the Letter of Credit in full and hold
the proceeds thereof as a cash
security deposit. Each Letter of Credit
shall be issued by a commercial bank
that has a credit rating with respect to
certificates of deposit, short term
deposits or commercial paper of at least
P-2 (or equivalent) by Moody's Investor
Service, Inc., or at least A-2 (or
equivalent) by Standard & Poor's Corporation.
If the issuer's credit rating is reduced
below P-2 (or equivalent) by Moody's
Investor Service, Inc., or at least A-2 (or
equivalent) by Standard & Poor's
Corporation, or if the financial condition
of the issuer changes in any other
materially adverse way, then Landlord shall
have the right to require that
Tenant obtain from a different issuer a
substitute Letter of Credit that
complies in all respects with the
requirements of this Section, and Tenant's
failure to obtain such substitute Letter of
Credit within twenty (20) days after
Landlord's demand therefor (with no other
notice, or grace or cure period being
applicable thereto) shall entitle Landlord
immediately to draw upon the existing
Letter of Credit in full, without any
further notice to Tenant. Landlord may
use, apply or retain the proceeds of the
Letter of Credit to the same extent
that Landlord may use, apply or retain any
cash security deposit, as set forth
herein. If Landlord draws against the
Letter of Credit and uses or applies the
proceeds as Landlord could apply the
Security Deposit in accordance with this
Lease, Tenant shall, within ten (10) days
after notice from Landlord, provide
Landlord with either an additional Letter
of Credit in the amount so drawn or an
amendment to the existing Letter of Credit
restoring the amount thereof to the
amount initially provided. Tenant hereby
agrees to cooperate promptly, at its
expense with Landlord to execute and
deliver to Landlord any modifications,
amendments and replacements of the Letter
of Credit, as Landlord may reasonably
request to carry out the terms and
conditions hereof.
If the
Annual Fixed Rent or Additional Rent payable hereunder shall be
overdue and unpaid or should Landlord make
any payment on behalf of the Tenant,
or Tenant shall fail to perform any of the
terms of this Lease, then Landlord
may, at its option and without notice or
prejudice to any other remedy which
Landlord may have on account thereof,
appropriate and apply the entire Security
Deposit or so much thereof as may be
necessary to compensate
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Landlord toward the payment of Annual Fixed
Rent, Additional Rent or other sums
or loss or damage sustained by Landlord due
to such breach by Tenant; and Tenant
shall forthwith upon demand restore the
Security Deposit to the amount stated in
Section 1.1. Notwithstanding the foregoing,
upon the application by Landlord of
all or any portion of the Security Deposit
(with or without notice thereof to
Tenant) to compensate Landlord for a
failure by Tenant to pay any Annual Fixed
Rent or Additional Rent when due or to
perform any other obligation hereunder,
and until Tenant shall have restored the
Security Deposit to the amount required
by Section 1.1, Tenant shall be deemed to
be in default in the payment of
Additional Rent for purposes of Section
8.l(a)(I) hereof. So long as Tenant
shall not be in default of its obligations
under this Lease, Landlord shall
return the Security Deposit, or so much
thereof as shall have not theretofore
been applied in accordance with the terms
of this Section 4.7 (and less any
amounts Landlord shall estimate shall be
due from Tenant following year-end
reconciliation of Operating Costs and
Taxes) to Tenant promptly following the
expiration or earlier termination of the
term of this Lease and the surrender of
possession of the Premises by Tenant to
Landlord in accordance with the terms of
this Lease. While Landlord holds the
Security Deposit, Landlord shall have no
obligation to pay interest on the same and
shall have the right to commingle the
same with Landlord's other funds. If
Landlord conveys Landlord's interest under
this Lease, the Security Deposit, or any
part thereof not previously applied,
shall be turned over by Landlord to
Landlord's grantee, and Tenant shall look
solely to such grantee for proper
application of the Security Deposit in
accordance with the terms of this Section
4.7 and the return thereof in
accordance herewith. The holder of a
mortgage on the Property shall not be
responsible to Tenant for the return or
application of the Security Deposit,
whether or not it succeeds to the position
of Landlord hereunder, unless such
holder actually receives the Security
Deposit.
ARTICLE 5
Landlord's Covenants
5.1
Affirmative Covenants. Landlord shall, during the term of this
Lease
provide the following:
5.1.1 Heat and Air-Conditioning. Landlord shall maintain the
central
Building heat, ventilation and
air-conditioning equipment ("HVAC") to provide
outside air and chilled and heated water to
a central area in the Premises.
Tenant shall pay, as Additional Rent, all
charges (which charges shall include
costs of utilities and maintenance and
repair costs) incurred by Landlord to
supply HVAC to the Premises, and Landlord
shall substantiate the basis of such
charges using customary industry
practices.
5.1.2 Landscaping. Landlord shall provide cleaning, maintenance
and
landscaping to the common areas of the
Building and Property (including snow
removal to the extent necessary to maintain
reasonable access to the Building
and the parking lot) in accordance with
standards generally prevailing
throughout the term hereof in comparable
office buildings in the Route 128 area.
5.1.3 Elevator, Lighting and Electricity. Landlord shall
furnish
non-exclusive elevator service to the
Premises; purchase and install, at
Tenant's expense, all lamps, tubes, bulbs,
starters and ballasts for lighting
fixtures in the Premises; provide lighting
to public and
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common areas of the Property; and arrange
for the supply of electrical power to
the Premises to accommodate a load not
exceeding the limitations contained in
Section 6.2.4.
5.1.4 Repairs. Except as otherwise expressly provided herein,
Landlord shall promptly and professionally
make such repairs and replacements to
the roof, exterior walls, floor slabs and
other structural components of the
Building, and to the common areas and
facilities of the Building (including any
common area plumbing, electrical and HVAC
equipment, elevators and any other
common equipment or systems in the
Building) as may be necessary to keep them in
good repair and condition (exclusive of
equipment installed by Tenant and except
for those repairs required to be made by
Tenant pursuant to Subsection 6.1.3
hereof and repairs or replacements
occasioned by any act or negligence of
Tenant, its servants, agents, customers,
contractors, employees, invitees, or
licensees).
5.2
Interruption. Landlord shall have no responsibility or liability
to
Tenant for failure, interruption,
inadequacy, defect or unavailability of any
services, facilities, utilities, repairs or
replacements or for any failure or
inability to provide access or to perform
any other obligation under this Lease
caused by breakage, accident, fire, flood
or other casualty, strikes or other
labor trouble, order or regulation of or by
any governmental authority,
inclement weather, repairs, inability to
obtain or shortages of utilities,
supplies, labor or materials, war, civil
commotion or other emergency,
transportation difficulties or due to any
act or neglect of Tenant or Tenant's
servants, agents, employees or licensees or
for any other cause beyond the
reasonable control of Landlord, and in no
event shall Landlord be liable to
Tenant for any indirect or consequential
damages suffered by Tenant due to any
such failure, interruption, inadequacy,
defect or unavailability; and failure or
omission on the part of Landlord to furnish
any of same for any of the reasons
set forth in this paragraph shall not be
construed as an eviction of Tenant,
actual or constructive, nor entitle Tenant
to an abatement of rent, nor render
the Landlord liable in damages, nor release
Tenant from prompt fulfillment of
any of its covenants under this Lease.
Landlord
reserves the right to deny access to the Building and to
interrupt the services of the HVAC,
plumbing, electrical or other mechanical
systems or facilities in the Building when
necessary from time to time by reason
of accident or emergency, or for repairs,
alterations, replacements or
improvements which in the reasonable
judgment of Landlord are desirable or
necessary, until such repairs, alterations,
replacements or improvements shall
have been completed. Landlord shall use
reasonable efforts to minimize the
duration of any such interruption and to
give to Tenant at least three (3) days'
notice if service is to be interrupted,
except in cases of emergency.
5.3
Outside Services. In the event Tenant wishes to obtain services or
to
hire vendors relating to the Premises,
Tenant shall first obtain the prior
approval of Landlord for the installation
and/or utilization of such services or
vendors. Landlord's approval may not be
withheld, conditioned or delayed
unreasonably. Such services shall include,
but shall not be limited to, utility
providers, security services, moving
services, equipment servicers and
installers, catering services and the like.
Notwithstanding any Landlord
approval of the installation and/or
utilization of such services or vendors,
such installation and utilization shall be
at Tenant's sole cost, risk and
expense.
5.4 Access
to Building. During Normal Building Operating Hours, the
Building
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shall, subject to the provisions of Section
5.2, be open and access to the
Premises shall be freely available, subject
to the Rules and Regulations. During
periods other than Normal Building
Operating Hours, Tenant shall have access to
the Premises, but such access shall also be
subject to the Rules and
Regulations. Tenant acknowledges that
Tenant is responsible for providing
(subject to the terms of this Lease) such
security to and for its property and
personnel in the Premises as it deems
appropriate.
5.5
Parking. During the term of this Lease, Landlord shall provide
Tenant
with access to parking spaces on the
Property as follows:
(a) Tenant shall be entitled to 3.6 parking spaces per 1,000
square
feet of Premises Rentable Area, rounded
down to the nearest whole number. All
such parking spaces shall be unreserved and
available on a first-come,
first-served basis, except that six (6)
spaces, in the location shown on Exhibit
A-1, shall be identified as reserved for
Tenant's visitors.
(b) Tenant shall use such parking spaces solely for the parking
of
passenger vehicles of Tenant and Tenant's
employees, business invitees and
guests only.
(c) Landlord reserves the right to implement and modify systems
to
regulate access to and use of the parking
spaces, including, without limitation,
parking passes, parking stickers and card
key access, or any other system
reasonably designated by Landlord.
(d) Tenant hereby indemnifies and shall defend and hold
Landlord
harmless form and against all claims, loss,
cost or damage arising out of the
use by Tenant and Tenant's employees and
invitees of the parking spaces, except
to the extent caused by the willful
misconduct or gross negligence of Landlord
or Landlord's agent or employees.
5.6
Compliance with Americans with Disabilities Act. As of the
Commencement Date, the common areas of the
Property shall, to Landlord's
knowledge, be in material compliance with
the Americans with Disabilities Act of
1990, as amended and all other applicable
laws and regulations concerning access
to and use of facilities like the Building
by people with disabilities,
including without limitation, the
Massachusetts Architectural Business Board
regulations (collectively, the "ADA"). If
during the term of this Lease any
improvement or alteration to the common
areas of the Property is necessary for
compliance with the ADA and the obligation
to make such improvement or
alteration is not Tenant's pursuant to
Sections 6.1.3, 6.1.4 or 6.2.5, Landlord
shall make such required improvement or
alteration.
5.7
Hazardous Waste Representation and Covenants. Landlord has
previously
delivered to Tenant reports dated December
15, 1995 and April 10, 1998 by Rizzo
Associates, Inc. and Dames & Moore
respectively with respect to certain
environmental conditions at the Property
and a Phase I and Downgradient Property
Status Report of Haley & Aldrich dated
August 1, 1997 with respect to 91
Hartwell Avenue. So long as the condition
requiring removal or remediation of
Hazardous Materials is not caused by Tenant
or any party for whom Tenant is
responsible, Landlord shall, in a manner
that complies with all applicable
Environmental Laws, perform or cause others
to perform all remediation necessary
to cause the Property to comply with
Environmental Laws. Landlord shall
indemnify and defend (with counsel
reasonably acceptable to Tenant) Tenant from
any liability for fines or penalties
arising from or related to a
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breach by Landlord of the forgoing
representations and agreements of Landlord
(including also costs incurred to avoid the
imposition of, or to discharge, any
lien on the Property arising from any such
breach) and from any liability for
costs of removing or remediating Hazardous
Materials which Landlord is obligated
to remediate pursuant to this
paragraph.
5.8
Indemnification. Subject to all limitations, waivers, exclusions
and
conditions contained in this Lease (each of
which shall control in the event of
any conflict or inconsistency with this
Section 5.8), Landlord shall defend and
indemnify Tenant and its directors,
officers, agents and employees against and
from any and all claims, liabilities or
penalties asserted by or on behalf of
any third party on account of personal
injury arising out of the negligence or
other wrongful conduct of Landlord or its
agents, contractors or employees
during the term of this Lease. In case of
any action or proceeding brought
against Tenant by reason of any such claim,
Landlord, upon notice from Tenant,
shall resist or defend such action or
proceeding and employ counsel therefor
reasonably satisfactory to Tenant.
Notwithstanding the foregoing in no event
shall this Section 5.8 require Landlord to
indemnify or defend Tenant or its
employees or Tenant's agents or their
employees against any loss, cost, damage,
liability, claim, or expense to the extent
arising out of the negligence or
misconduct of Tenant or its employees or
contractors or Tenant's agents or their
employees.
ARTICLE 6
Tenant's Additional Covenants
6.1
Affirmative Covenants. Tenant shall do the following:
6.1.1 Perform Obligations. Tenant shall perform promptly all of
the
obligations of Tenant set forth in this
Lease; and pay when due the Annual Fixed
Rent and Additional Rent and all other
amounts which by the terms of this Lease
are to be paid by Tenant.
6.1.2 Use. Tenant shall, during the term of this Lease, use the
Premises only for the Permitted Uses and
from time to time, procure and
maintain, and at Landlord's request provide
to Landlord copies of, all licenses
and permits necessary therefor and for any
other use or activity conducted at
the Premises, at Tenant's sole expense.
Tenant shall also provide to Landlord
access to all Material Safety Data Sheets
on any Hazardous Materials in the
Prem
