ATLANTIC WHARF WATERFRONT BUILDING 290 CONGRESS STREET BOSTON, MASSACHUSETTS 02210 I N D E X T O L E A S EFROM BP RUSSIA WHARF LLC TO BRIGHTCOVE INC. TABLE OF CONTENTS

Exhibit 10.7

ATLANTIC WHARF

WATERFRONT BUILDING

290 CONGRESS STREET

BOSTON, MASSACHUSETTS 02210

I N D E X T O L E A S E

FROM

BP RUSSIA WHARF LLC

TO

BRIGHTCOVE INC.

TABLE OF CONTENTS

 

 

-i-

 

-ii-

 

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ATLANTIC WHARF

THIS INSTRUMENT IS AN INDENTURE OF LEASE in which the Landlord and the Tenant are the parties hereinafter named, and which relates to space in the building known as the “ Office Tower” and the “Waterfront Office Building”.

The parties to this instrument hereby agree with each other as follows:

ARTICLE I

Basic Lease Provisions and Enumerations of Exhibits

 

1.1	Introduction

The following sets forth the basic data and identifying Exhibits elsewhere hereinafter referred to in this Lease, and, where appropriate, constitute definitions of the terms hereinafter listed.

 

1.2	Basic Data

 

 

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1.3	Enumeration of Exhibits

The following Exhibits attached hereto are a part of this Lease, are incorporated herein by reference, and are to be treated as a part of this Lease for all purposes. Undertakings contained in such Exhibits are agreements on the part of Landlord and Tenant, as the case may be, to perform the obligations stated therein to be performed by Landlord and Tenant, as and where stipulated therein.

 

 

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ARTICLE II

Premises

 

2.1	Demise and Lease of Premises

Landlord hereby demises and leases to Tenant, and Tenant hereby hires and accepts from Landlord, the Premises in the Building, excluding any portion of exterior walls except the inner surfaces thereof, the common stairways and stairwells, elevators and elevator walls, mechanical rooms, electric and telephone closets, janitor closets, and pipes, ducts, shafts, conduits, wires and appurtenant fixtures serving exclusively or in common other parts of the Building, and if the Premises includes less than the entire rentable area of any floor, excluding the common corridors, elevator lobbies and toilets located on such floor. Tenant shall have the non-exclusive right, to the extent that the same are available and in common with others entitled thereto, to use the fan rooms, janitorial, electrical, telephone and telecommunications closets, conduits, risers, shafts, and plenum spaces serving the Building. Tenant’s right to use such common areas are subject to the rules and regulations promulgated by Landlord from time to time in accordance with Section 11.3 hereof, subject, however, to the extent Tenant is given prior written notice thereof.

 

2.2	Appurtenant Rights and Reservations

Subject to Landlord’s right to change or alter any of the following in Landlord’s reasonable discretion as herein provided, Tenant shall have, as appurtenant to the Premises, the non-exclusive right to use in common with others entitled thereto, but not

 

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in a manner or extent that would materially interfere with the normal operation and use of the Building as a multi-tenant office building and subject to reasonable rules of general applicability to tenants of the Building or Atlantic Wharf from time to time made by Landlord (which shall include any successor owner of the Building or Atlantic Wharf of which Tenant is given notice): (a) the common lobbies, corridors, stairways, and elevators of the Building, and, subject to Section 2.1, the fan rooms, janitorial, electrical, telephone and telecommunications closets, pipes, ducts, shafts, conduits, risers, shafts, and plenum spaces serving the Premises in common with others, (b) the loading areas serving the Building and the common walkways and driveways necessary for access to the Building, (c) if the Premises include less than the entire rentable floor area of any floor, the common toilets, corridors and elevator lobby of such floor and (d) the plazas and other common areas of Atlantic Wharf as Landlord makes the same available from time to time to tenants or the public; and no other appurtenant rights and easements. No changes shall be made to the public or common areas that would unreasonably interfere with Tenant’s access to or use of the Premises for the purposes of this Lease or that would adversely affect the quality of the public or common areas as a mixed-use project consistent with other first class mixed-use projects in the Central Business District of Boston. To the extent that, during the Lease Term, Landlord is required, pursuant to the Chapter 91 License to which Atlantic Wharf is subject (as the same may be modified by agreement or waiver, from time to time), to operate any amenities open to the public (e.g., the multi-media room), Landlord shall comply with such obligation. Notwithstanding anything to the contrary herein, Landlord may establish reasonable rules and regulations for access to the Building by telecommunications providers providing services to tenants in the Building, which may include reasonable fees for Landlord’s providing access to closets, shafts, ducts or similar spaces reasonably necessary for the provision of such services, but such rules and regulations and Landlord shall not unreasonably deny access to the Building to any particular service provider proposing to provide services to Tenant except on the basis of a reasonably documented pattern of misconduct or damage to persons or property in buildings, which may include Atlantic Wharf or other properties owned by Landlord or its affiliates. Notwithstanding the foregoing, Landlord agrees to permit Cogent Communications to have telecommunications access to the Premises and the Building for the purpose of providing telecommunications service to Tenant. Provided that and so long as Tenant’s telecommunications service provider (“Provider”) does not provide telecommunications service to any other tenant of the Building, Landlord shall not require such Provider to pay any fees for such access.

Landlord reserves for its benefit and the benefit of any other owner the right from time to time, without unreasonable interference with Tenant’s use: (a) to install, use, maintain, repair, replace and relocate for service to the Premises and other parts of the Building, or either, pipes, ducts, conduits, wires and appurtenant fixtures, wherever located in the Premises or the Building, and (b) to alter or relocate any other common facility, provided that substitutions are substantially equivalent or better. Installations, replacements and relocations referred to in clause (a) above shall be located so far as practicable in the central core area of the Building, above ceiling surfaces, below floor surfaces or within

 

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perimeter walls of the Premises, and in any event in a manner that does not reduce the usable area of the Premises (other than to a de minimis extent). Except in the case of emergencies or for normal cleaning and maintenance operations, Landlord shall give Tenant reasonable advance notice of any of the foregoing activities which require work in the Premises and to conduct such work during non-business hours except if work can be conducted in a manner that does not materially interfere with Tenant’s business.

Landlord reserves and excepts for its benefit and the benefit of any others entitled thereto (including, without limitation, owners and tenants of condominium units of the Condominiums (the “Condominium Units”) all rights of ownership (as the case may be) and use in all respects outside the Premises, including without limitation, the Building and all other structures and improvements and plazas and common areas in Atlantic Wharf, except that at all times during the term of this Lease, subject to Force Majeure, as defined in Section 14.1, Landlord’s rules and regulations promulgated pursuant to Section 11.3, and Landlord’s reasonable security requirements, Tenant shall have a reasonable means of access from a public street to the Premises and the Garage and the right to use the amenities available from time to time to tenants and occupants in the Building. Without limitation of the foregoing reservation of rights by Landlord, it is understood that in its sole discretion Landlord or the owners of Condominium Units pursuant to the requirements of the applicable Condominium Documents, as the case may be, shall have the right to change and rearrange the plazas and other common areas of the Building and Atlantic Wharf, to reasonably change, relocate and eliminate facilities therein, to reasonably permit the use of or lease all or part thereof for exhibitions and displays and to sell, lease or dedicate all or part thereof to public use; and further that Landlord or the owners of Condominium Units pursuant to the requirements of the applicable Condominium Documents or any other owner, as the case may be, shall have the right to make changes in, additions to and eliminations from the Building and other structures and improvements in Atlantic Wharf, the Premises excepted; provided however that Tenant, its employees, agents, clients, customers, and invitees shall at all times have reasonable access to the Premises, the Building and the Garage through lobby areas and entrances, as the case may be, applicable to the Building and the Premises generally consistent with Class A office Buildings in the Central Business District in Boston, except during reasonable temporary periods of repair, renovation or construction, and subject to Force Majeure, Landlord’s rules and regulations promulgated pursuant to Section 11.3, and Landlord’s reasonable security requirements. Landlord is not under any obligation to permit individuals without proper building identification or guests of Tenant who are not properly identified to enter the Building after 6:00 p.m.

ARTICLE III

Lease Term and Extension Options

 

3.1

Term

The Term of this Lease shall be the period specified in Section 1.2 hereof as the “Lease Term,” unless sooner terminated or extended as herein provided.

 

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As soon as may be convenient after the Commencement Date has been determined, Landlord and Tenant agree to join with each other in the execution, in the form of Exhibit E hereto, of a written Commencement Date Agreement in which the Commencement Date and specified Lease Term of this Lease shall be stated. If Tenant shall fail to execute such Agreement, the Commencement Date and Lease Term shall be as reasonably determined by Landlord in accordance with the terms of this Lease.

 

3.2	Extension Option

 

(A)

On the conditions (which conditions Landlord may waive by written notice to Tenant) that both at the time of exercise of the applicable herein described option to extend and as of the commencement of the applicable Extended Term in question (i) there exists no “Event of Default” (defined in Section 15.1) and (ii) this Lease is still in full force and effect, and (iii) Tenant has neither assigned this Lease nor sublet more than fifty percent (50%) of the Rentable Floor Area of the Premises (except for an assignment or subletting permitted without Landlord’s consent under Section 12.5 hereof), Tenant shall have the right to extend the Term hereof upon all the same terms, conditions, covenants and agreements herein contained (except that the Annual Fixed Rent which shall be adjusted during the option period as hereinbelow set forth and except that there shall be no further option to extend except as set forth herein) for two (2) periods of five (5) years each, as hereinafter set forth. Each option period is sometimes herein referred to as an “Extended Term.” Notwithstanding any implication to the contrary Landlord has no obligation to make any additional payment to Tenant in respect of any construction allowance or the like or to perform any work to the Premises as a result of the exercise by Tenant of any such option, the parties hereby agreeing, however, that the amount (if any) of any construction allowance and/or work performed to the Premises by Landlord in connection with an Extended Term shall be a factor in determining the Prevailing Market Rent Term.

 

(B)

If Tenant desires to exercise an option to extend the Term, then Tenant shall give notice (“Exercise Notice”) to Landlord, not earlier than eighteen (18) months (except in connection with an exercise pursuant to Sections 3.3 or 3.4 of this Lease) nor later than fifteen (15) months prior to the expiration of the then Term of this Lease (as it may have been previously extended) exercising such option to extend. Within thirty (30) days following Landlord’s receipt of Tenant’s Exercise Notice but in no event earlier than twenty one months prior to the expiration of the then current Term, Landlord shall give notice to Tenant of Landlord’s good faith proposal of the Prevailing Market Rent to be applied for the Annual Fixed Rent for the applicable Extended Term (“Landlord’s Rent Quotation”). For all purposes of this Lease, “Prevailing Market Rent” shall mean the arms-length fair market annual rental rate per rentable square foot of (i) the Premises in connection Tenant’s exercise of its extension options under this Section 3.2, or (ii) the Available 5 th Floor ROFO Space in connection with Tenant’s exercise of its rights

 

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under Section 3.3 of this Lease, or (iii) any expansion space leased in connection with Tenant’s rights under Section 3.5 of this Lease, as applicable under leases and amendments then being entered into with private sector tenants in Class A office buildings in the Central Business District of Boston, taking into account all then relevant factors (including, without limitation, those set forth in Exhibit H ). If at the expiration of thirty (30) days after the date when Landlord provides such quotation to Tenant (the “Negotiation Period”), during which period Landlord and Tenant agree to negotiate in good faith with respect to the Prevailing Market Rent applicable to the Premises, Landlord and Tenant have not reached agreement on a determination of the Prevailing Market Rent for such Extended Term and executed a written instrument extending the Term of this Lease pursuant to such agreement, then Tenant shall have the right, for thirty (30) days following the expiration of the Negotiation Period, to make a request to Landlord for a broker determination (the “Broker Determination”) of the Prevailing Market Rent for such Extended Term, which Broker Determination shall be made in the manner set forth in Exhibit H. If Tenant timely shall have requested the Broker Determination, then the Annual Fixed Rent for the applicable Extended Term shall be the greater of (a) the Prevailing Market Rent as determined by the Broker Determination, with a Base Year for Operating Expenses for such Extended Term which is the calendar year immediately preceding the calendar year in which such Extended Term commences and a Base Year for Taxes for such Extended Term which is the fiscal tax year immediately preceding the fiscal tax year immediately preceding fiscal tax year in which such Extended Term commences (“Prevailing Market Terms”), or (b) the product of $41.00 and the Rentable Floor Area of the Premises, with a Base Year for Operating Expenses for such Extended Term which is same calendar year as the Base Year in effect immediately preceding the commencement of such Extended Term and a Base Year for Taxes which is which is same fiscal tax year as the Base Year in effect immediately preceding the commencement of such Extended Term (“Floor Terms”). If Tenant does not timely request the Broker Determination, then the Annual Fixed Rent during the applicable Extended Term shall be equal to the greater of (a) Landlord’s Rent Quotation or (b) the product of $41.00 and the Rentable Floor Area of the Premises.

 

(C)

Upon the giving of the Exercise Notice by Tenant to Landlord exercising Tenant’s applicable option to extend the Lease Term in accordance with the provisions of Section 3.2 (B) above, then this Lease and the Lease Term hereof shall automatically be deemed extended, for the applicable Extended Term, without the necessity for the execution of any additional documents, except that Landlord and Tenant agree to enter into an instrument in writing setting forth the Annual Fixed Rent for the applicable Extended Term as determined in the relevant manner set forth in this Section 3.2; and in such event all references herein to the Lease Term or the Term of this Lease shall be construed as referring to the Lease Term, as so extended, unless the context clearly otherwise requires, and except that: (i) there shall be no further option to extend the Lease Term beyond the two (2) Extended Option periods provided for in this Section 3.2, and (ii) if the Base Rent payable

 

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by Tenant in respect of such Extended Term is based upon Prevailing Market Rate, then the Base Year for Operating Expenses for such Extended Term shall be the calendar year immediately preceding the calendar year in which such Extended Term commences and the Base Year for Taxes for such Extended Term shall be the fiscal tax year immediately preceding the fiscal tax year immediately preceding fiscal tax year in which such Extended Term commences. Notwithstanding anything contained herein to the contrary, in no event shall Tenant have the right to exercise more than one extension option at a time and, further, Tenant shall not have the right to exercise its second extension option unless it has duly exercised its first extension option and in no event shall the Lease Term hereof be extended for more than ten (10) years after the expiration of the Original Lease Term hereof.

 

3.3	5 th Floor Right of First Offer

 

(A)

5 th Floor Right of First Offer Conditions. On the conditions (which conditions Landlord may waive by written notice to Tenant at any time) that both at the time that any Available 5 th Floor ROFO Space would be offered to Tenant and as of the date upon which the Available 5 th Floor ROFO Space which Tenant has elected to lease pursuant to this Section 3.3 would have otherwise become incorporated into the Premises: (i) there exists no Event of Default, (ii) this Lease is still in full force and effect, and (iii) Tenant has neither assigned this Lease nor sublet more than thirty five percent (35%) of the Rentable Floor Area of the Premises then leased to Tenant (excluding any sublease or assignment to a Permitted Transferee which is permitted in accordance with Section 12.5), prior to offering to lease or accepting any offer to lease the Available 5 th Floor ROFO Space to a third party other than a third party with 5 th Floor Right of First Offer Prior Rights (as hereinafter defined), Landlord will first offer such Available 5 th Floor ROFO Space to Tenant for lease pursuant to this Section 3.3 (“ Tenant’s 5 th Floor Right of First Offer ”).

 

(B)

Definition of 5 th Floor Right of First Offer Space. The parties hereby acknowledge that, as of the Execution Date of this Lease, the entire 5 th floor of the Waterfront Building is leased to another tenant of the Building, Payette Associates (“ Payette ”). For the purposes hereof, an “ Available 5 th Floor ROFO Space ” shall be defined as any leasable space on the 5 th floor of the Building, when Landlord determines in good faith to make any such space available for lease after the occupancy of Payette, and anyone claiming by, through, or under Payette; provided, however, that Landlord shall have the right to extend the term or otherwise modify or amend Landlord’s lease with Payette.

 

(C)

Exercise of Right to Lease Available 5 th Floor ROFO Space. Landlord shall give Tenant written notice (“ Landlord’s 5 th Floor ROFO Notice ”) at the time that Landlord determines in good faith, as aforesaid, that any particular Available 5 th Floor ROFO Space will become available for lease. Landlord’s 5 th Floor ROFO Notice shall set forth (i) Landlord’s good faith quotation of the Prevailing Market

 

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Rent therefore to be the proposed Annual Fixed Rent for the Available 5 th Floor ROFO Space, and (ii) all other material terms and conditions (which need not include a tenant improvement allowance, the parties hereby agreeing that the amount of tenant improvement allowance, if any, provided by Landlord in connection with Tenant’s demise of an Available 5 th Floor ROFO Space shall be a factor in determining the Prevailing Market Rate for such Available 5 th Floor ROFO Space) that will apply to the Available 5 th Floor ROFO Space, all of which shall be the terms and conditions of this Lease (i) except for any conditions unique to such Available 5 th Floor ROFO Space and set forth in Landlord’s 5 th Floor ROFO Notice, and (ii) except as set forth in or subject to the provisions of Section 3.3(D) below. Tenant shall have the right, exercisable upon written notice (“ Tenant’s 5 th Floor ROFO Exercise Notice ”) given to Landlord within twenty (20) days after the receipt of Landlord’s 5 th Floor ROFO Notice, (i) to lease all of the Available 5 th Floor ROFO Space, on the terms set forth in Landlord’s 5 th Floor ROFO Notice, (ii) to lease all of the Available 5 th Floor ROFO Space, but reject the quotation of annual fixed rent set forth in Landlord’s 5 th Floor ROFO Notice and instead elect to submit the same to a Broker Determination in accordance with the provisions of Exhibit H attached hereto to determine the Prevailing Market Rent for the Available 5 th Floor ROFO Space, or (iii) reject Landlord’s 5 th Floor ROFO Notice. If Tenant fails timely to give Tenant’s 5 th Floor ROFO Exercise Notice, Landlord shall be free to lease the Available 5 th Floor ROFO Space (or any portion thereof) to a third party and Tenant shall have no further right to lease such Available 5 th Floor ROFO Space (or such portion thereof) pursuant to this Section 3.3, unless:

(x) no such third party lease is executed for the entirety of the Available 5 ^th Floor ROFO Space that was previously offered to Tenant during the 5 ^th Floor ROFO Space Leasing Period, as hereinafter defined, (in which event Tenant shall again have a right of first offer to lease the entirety, or the portion of the Available 5 ^th Floor ROFO Space which has not been leased to a third party, as the case may be, of the Available 5 ^th Floor Space in accordance with the provisions of this Section 3.3); or

(y) the term of any such third party lease, as from time to time extended or renewed, has expired or sooner ended, in which event the portion of the 5 ^th floor leased to such third party shall again become Available 5 ^th ROFO Space and Tenant shall again have a right of first offer to lease such Available 5 ^th Floor ROFO Space in accordance with the provisions of this Section 3.3.

The “ 5 ^th Floor ROFO Space Leasing Period ” with respect to any Landlord’s 5 ^th Floor ROFO Notice shall be the period ending as of the date (“ 5 ^th Floor ROFO Space Leasing Period Expiration Date ”) twelve (12) months after the date that Tenant fails timely to accept the terms of such Landlord’s 5 ^th Floor ROFO Notice, as aforesaid, except that if, as of the date twelve (12) months after the date that Tenant fails timely to accept the terms of such Landlord’s 5 ^th Floor ROFO

 

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Notice, Landlord is engaged in good faith negotiations with a third party to enter into an agreement to lease the Available 5 ^th Floor ROFO Space in question, then such 5 ^th Floor ROFO Space Lease Expiration Date shall be the date fifteen (15) months after the date that Tenant fails timely to accept the terms of such Landlord’s 5 ^th Floor ROFO Notice. Upon the timely giving of such Tenant’s 5 ^th Floor ROFO Exercise Notice, Landlord shall lease and demise to Tenant and Tenant shall hire and take from Landlord, the entirety of such Available 5 ^th Floor ROFO Space commencing upon the Term Commencement Date for such Available 5 ^th Floor ROFO Space (as determined pursuant to Section 3.3(D)(1) below), upon all of the same terms and conditions of the Lease, except as hereinafter set forth. In any case in which Tenant shall have waived said right of first offer or said right shall have expired, Tenant shall, upon request of Landlord, execute and deliver in recordable form an instrument indicating such waiver or expiration, subject to Tenant’s continuing rights under this Section 3.3, which instrument shall be conclusive in favor of all persons relying thereon in good faith.

Notwithstanding anything to the contrary provided in this Section 3.3 (including, but not limited to, Section 3.3(C)), if the Available 5 ^th Floor ROFO Space shall be available for delivery to Tenant at any time during the last thirty six (36) months of the Original Lease Term or the first Extended Term, as the case may be, then: (a) if Tenant has no further right to extend the term of the Lease (i.e. because Tenant’s right to extend the term of the Lease pursuant to Section 3.2 has been irrevocably waived by Tenant or has lapsed unexercised), then Tenant shall not be entitled to lease the Available 5 ^th Floor ROFO Space under this Section 3.3, (b) if Tenant then has a right to extend the term of the Lease pursuant to Section 3.2 which has not either lapsed unexercised or been irrevocably waived), then Tenant shall have no right to lease such Available 5 ^th Floor ROFO Space unless, prior to, or simultaneously with, the giving of Tenant’s 5 ^th Floor ROFO Exercise Notice, Tenant timely and properly exercises such extension option.

 

(D)

Lease Provisions Applying to Available 5 th Floor ROFO Space. The leasing to Tenant of such Available 5 th Floor ROFO Space shall be upon all of the same terms and conditions of the Lease, except as follows:

 

1.

Commencement Date; Occupancy Date . The term as to the Available 5 th Floor ROFO Space shall be co-terminous with the term of this Lease subject, however, to the last paragraph of Section 3.3(C) above. The Commencement Date in respect of such Available 5 th Floor ROFO Space shall be the later of: (x) the commencement date in respect of such Available 5 th Floor ROFO Space specified in Landlord’s 5 th Floor ROFO Notice (“Estimated 5 th Floor ROFO Commencement Date”) or (y) the date that Landlord delivers such Available 5 th Floor ROFO Space to Tenant in the condition specified in Landlord’s 5 th Floor ROFO Notice or as otherwise provided in Section 3.3(D)(3) below.

 

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Tenant’s 5 ^th Floor ROFO Rescission Right . If the Commencement Date in respect of an Available 5 ^th Floor ROFO Space does not occur on or before the date one hundred fifty (150) days after the Estimated 5 ^th Floor ROFO Commencement Date for such Available 5 ^th Floor ROFO Space, Tenant shall have the right (“ Tenant’s 5 ^th Floor ROFO Rescission Right ”) to cancel Tenant’s demise of such Available 5 ^th Floor ROFO Space. Tenant may exercise Tenant’s 5 ^th Floor ROFO Rescission Right by giving Landlord thirty (30) days written rescission notice (“ Tenant’s 5 ^th Floor ROFO Rescission Notice ”). If the Commencement Date with respect to such Available 5 ^th Floor ROFO Space occurs on or before the date thirty (30) days after Landlord receives such Tenant’s 5 ^th Floor ROFO Rescission Notice, then Tenant’s 5 ^th Floor ROFO Rescission Notice shall be void and without force or effect, and Tenant shall have no right to cancel its demise of such Available 5 ^th Floor ROFO Space pursuant to this Section 3.3(D)(1). If the Commencement Date with respect to such Available 5 ^th Floor ROFO Space does not occur on or before the date thirty (30) days after Landlord receives such Tenant’s 5 ^th Floor ROFO Rescission Notice, then the Tenant’s demise of such Available 5 ^th Floor ROFO Space shall be cancelled as of the date (“5 ^th Floor ROFO Effective Cancellation Date ”) which is thirty (30) days following such notice, and neither party shall have any further liability or obligation to the other party with respect to such Available 5 ^th Floor ROFO Space. The effect of Tenant’s exercise of Tenant’s 5 ^th Floor ROFO Rescission Right shall be the same as if Tenant had failed timely to accept Landlord’s offer to lease such Available 5 ^th Floor ROFO Space, except that, as provided in Section 3.5(C), Tenant’s Termination Right may be revived.

 

2.

Fixed Annual Rent. The Annual Fixed Rent in respect of such Available 5 th Floor ROFO Space shall be as set forth in Landlord’s 5 th Floor ROFO Notice, unless within Tenant’s 5 th Floor ROFO Exercise Notice Tenant elects to submit the same to a Broker Determination in accordance with the provisions of Exhibit H attached hereto to determine the Prevailing Market Rent as of the Commencement Date for such Available 5 th Floor ROFO Space, in which event the Annual Fixed Rent in respect of such Available 5 th Floor ROFO Space shall be the Prevailing Market Rent for such Available 5 th Floor ROFO Space as of the Commencement Date with respect to such Available 5 th Floor ROFO Space determined in accordance with Exhibit H . Both parties shall be bound by such Broker Determination.

 

3.

Base Years . The Base Year with respect to Operating Expenses for such Available 5 th Floor ROFO Space shall be the calendar year immediately preceding the Commencement Date with respect to such Available 5 th Floor ROFO Space. The Base Year with respect to Landlord’s Tax Expenses for such Available 5 th Floor ROFO Space shall be the fiscal/tax year immediately preceding the Commencement Date with respect to such Available 5 th Floor ROFO Space.

 

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4.

Condition of Available 5 th Floor ROFO Space . Tenant shall take such Available 5 th Floor ROFO Space “as-is” in its then (i.e., as of the date of delivery) state of construction, finish, and decoration, without any obligation on the part of Landlord to construct or prepare any Available 5 th Floor ROFO Space for Tenant’s occupancy, and with no obligation on the part of Landlord to provide any Landlord Contribution in respect of such Available 5 th Floor ROFO Space unless otherwise specified in Landlord’s 5 th Floor ROFO Notice or otherwise mutually agreed by Landlord and Tenant, and in either such case the foregoing shall be a factor in the calculation of the Prevailing Market Rent. Notwithstanding the foregoing, Landlord shall in all events deliver possession of the Available 5 th Floor ROFO Space to Tenant vacant, broom clean, free of all Hazardous Materials, property, tenants and occupants.

 

(E)

5 th Floor Right of First Offer Prior Rights . Notwithstanding anything herein to the contrary, Tenant’s 5 th Floor Right of First Offer is subject and subordinate to the following: (i) the rights (whether such rights are designated as an extension right, right of first offer, right of first refusal, expansion option or otherwise) of Payette to extend, renew, amend the term of or otherwise modify or amend its lease of such Available 5 th Floor ROFO Space, (ii) the existing rights as of the date of this Lease of Communispace Corporation to lease such Available 5 th Floor ROFO Space, and (iii) the existing rights as of the date of this Lease of Wellington Management Company to lease such 5 th Floor Space (collectively called the “5 th Floor Right of First Offer Prior Rights”).

 

3.4	Intentionally Omitted.

 

3.5	Tenant’s Contingent Termination Right

 

(A)

Subject to the provisions of this Section 3.5, Tenant shall have the following right (“ Tenant’s Termination Right ”) to terminate the term of the Lease as of the last day of the seventh Lease Year, or later pursuant Section 3.5(C) (“ Effective Termination Date ”) by: (i) giving written notice (“ Tenant’s Termination Notice ”) to Landlord on or before the date that is fifteen (15) months prior to the Effective Termination Date, (ii) paying fifty (50%) of the Termination Payment, as hereinafter defined, to Landlord at the time that Tenant gives the Tenant’s Termination Notice to Landlord, and (iii) paying the balance of the Termination Payment (“ Balance of Termination Payment ”) to Landlord on or before the Effective Termination Date.

 

(B)

Termination Option Conditions . It shall be a condition (“ Termination Option Conditions ”) to Tenant’s right to exercise Tenant’s Termination Right under this Section 3.5 that the following conditions are all satisfied:

 

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(i) there is, as of the time that Tenant gives Tenant’s Termination Notice, as hereinafter defined, no uncured monetary or material non-monetary Event of Default in existence and continuing;

(ii) there is, as of the Effective Termination Date, no uncured monetary or material non-monetary default by Tenant in its obligations under the Lease in existence and continuing of which Landlord has given Tenant written notice prior to the Effective Termination Date (“ Noticed Tenant Default ”), provided however, that if Tenant has not cured a Noticed Tenant Default on or before the Effective Termination Date, Tenant shall nevertheless be deemed to have satisfied the Termination Option Condition set forth in this clause (ii) if Tenant cures such Noticed Tenant Default on or before the last day of the grace period for curing such Noticed Tenant Default (i.e. as set forth in Section 15.1) even if such cure occurs after the Effective Termination Date; and

(iii) Landlord has been unable to satisfy the Tenant’s Expansion Needs Condition, as hereinafter defined.

The Termination Option Conditions under clauses (i) and (ii) above are for the sole benefit of Landlord; therefore, Landlord may, at its election, waive either of such Termination Option Conditions.

 

(C)

Tenant’s Expansion Needs Condition . The parties intend that Tenant will have the right to exercise Tenant’s Termination Right only if Landlord is unable to satisfy Tenant’s expansion needs, as expressly set forth in this Section 3.5(C). The “ Tenant’s Expansion Needs Condition ” will only be deemed to have been satisfied by Landlord if either: (i) Tenant does not, during the Expansion Request Period, as hereinafter defined, give Landlord a written request (“ Expansion Request ”) to Landlord to lease expansion space in the Waterfront Office Building containing at least 10,000 rentable square feet, or (ii) Tenant gives an Expansion Request to Landlord during the Expansion Request Period, and Landlord delivers to Tenant a written offer (“ Landlord’s Expansion Offer ”) to lease Acceptable Expansion Space, as hereinafter defined; provided however, that if Tenant gives Landlord a timely Expansion Request and, in response, if Landlord gives Tenant a Landlord’s Expansion Offer to lease Acceptable Expansion Space, but Tenant’s demise of such Acceptable Expansion Space is cancelled by reason of the exercise, by Tenant of its Tenant’s Acceptable Expansion Space Rescission Right or Tenant’s 5 th Floor ROFO Rescission Right, as applicable, then Landlord shall not be deemed to have satisfied Tenant’s Expansion Needs Condition based upon such Landlord’s Expansion Offer. For the purposes of this Section 3.5(C), Tenant shall have the right to give Landlord only one Expansion Request, and Landlord may not deliver a Landlord’s Expansion Offer prior to the receipt by Landlord of an Expansion Request from Tenant. The “ Expansion Request Period ” shall be the period commencing as of the second anniversary of the Commencement Date and ending as of the date twenty-seven (27) months prior to the Effective Termination

 

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Date. Landlord shall have no obligation to offer Acceptable Expansion Space to Tenant in response to the Expansion Request. Landlord’s Expansion Offer shall set forth: (x) the estimated Commencement Date with respect to the Acceptable Expansion Space, (y) the rent which would be payable by Tenant with respect to such Acceptable Expansion Space, which rent shall be based upon Landlord’s designation of the Prevailing Market Rent for such Acceptable Expansion Space, and (z) the terms and conditions as set forth in Section 3.3(D) shall, except to the extent inconsistent with this Section 3.5, be applicable to the Acceptable Expansion Space as if the Acceptable Expansion Space were the Available 5 th Floor ROFO Space. Notwithstanding anything to the contrary herein contained, if, subject to the next following paragraph either:

 

(i)

on or after January 1, 2016, but not less than thirty (30) days prior to the expiration of the Expansion Request Period, Landlord gives to Tenant a Landlord’s 5 th Floor ROFO Notice(s), pursuant to Section 3.3, which, if Tenant timely accepted the offers represented by such Notice(s), would have permitted Tenant to demise Available 5 th Floor ROFO Space containing not less than 15,000 rentable square feet in the aggregate, for a term commencing during calendar year 2016 or calendar year 2017, or

 

(ii)

Tenant, at any time after the Date of this Lease, enters into an agreement with Landlord leasing any additional space in the Building containing, in the aggregate, not less than 15,000 rentable square feet in the aggregate, for a term commencing during calendar year 2016 or calendar year 2017,

 

then, and, in any such event, Landlord shall be deemed to have satisfied Tenant’s Expansion Needs Condition and, subject to the next following paragraph, Tenant shall have no right to exercise Tenant’s Termination Right.

 

Revival of Tenant’s Termination Right if Tenant Exercises Rescission Rights . Notwithstanding the foregoing, if Tenant exercises its right to lease Available 5 th Floor ROFO Space that qualifies to satisfy Tenant’s Expansion Needs Condition pursuant to clause (i) above and/or Acceptable Expansion Space, and Tenant’s demise of such ROFO Space or Tenant’s Acceptable Expansion Space is cancelled by reason of Tenant’s exercise of Tenant’s 5 th Floor ROFO Rescission Right or Acceptable Expansion Space Rescission Right (as applicable) so that Tenant will have leased less than an additional Minimum Expansion Space Floor Area, as defined in Section 3.5(D), by reason of such cancellation(s), then Landlord shall, notwithstanding the foregoing, not be deemed to have satisfied the Tenant’s Expansion Needs Condition pursuant to clause (i) of the immediately preceding sentence, and Tenant shall again have the right to exercise Tenant’s Termination Right pursuant to this Section 3.5.

 

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If Tenant’s Termination Right is revived by reason of the exercise by Tenant of a Tenant’s 5 th Floor ROFO Rescission Right or Tenant’s Acceptable Expansion Space Rescission Right, and if the effective date of cancellation of demise of the applicable Available ROFO Space pursuant to such Tenant’s 5 th Floor ROFO Rescission Right or of the Acceptable Expansion Space pursuant to Tenant’s Acceptable Expansion Space Rescission Right is on or after the date sixteen (16) months prior to the last day of the seventh Lease Year (i.e. one month prior to the date Tenant’s Termination Notice is due), then:

 

(a)

Tenant may exercise Tenant’s Termination Right by giving a Tenant’s Termination Notice on or before the date ninety (90) days after the 5 th Floor ROFO Effective Cancellation Date or the Acceptable Expansion Space Effective Cancellation Date, as the case may be;

 

(b)

If Tenant exercises Tenant’s Termination Right, the Effective Termination Date shall be the date fifteen (15) months after Landlord receives such Tenant’s Termination Notice; and

 

(c)

For the purposes of determining the Termination Payment, the Unamortized Portion of Landlord’s Transaction Costs shall be determined based upon the amount of principal which would remain unpaid as of the date fifteen (15) months after Landlord receives Tenant’s Termination Notice, as set forth in clause (b) above.

 

(D)

Acceptable Expansion Space . “ Acceptable Expansion Space ” shall be defined as any area in the Waterfront Office Building offered to be leased by Landlord to Tenant pursuant to Landlord’s Expansion Offer which (i) contains not less than eighty (80%) of the Rentable Floor Area (“ Minimum Expansion Space Floor Area ”) nor more than one hundred twenty (120%) of the Rentable Floor Area requested to be leased by Tenant in the Expansion Request (“ Maximum Expansion Space Floor Area ”) (the condition set forth in this clause (i) being referred to herein as the “ Size Condition ”), (ii) with respect to which the rent payable by Tenant is based upon the Prevailing Market Rent, as defined in Section 3.2 above, and (iii) the estimated Commencement Date with respect to the Acceptable Expansion Space will occur during calendar years 2016 or 2017 (the condition set forth in this clause (iii) being referred to herein as the “ Commencement Date Condition ”).

 

(E)

Tenant’s Right to Dispute Landlord’s Expansion Offer ; Tenant’s Demise of Acceptable Expansion Space . If Landlord gives Tenant a Landlord’s Expansion Offer to lease Acceptable Expansion Space pursuant to Section 3.5(C), then Tenant shall have the following options:

(i) Tenant may unconditionally accept such Landlord’s Expansion Offer by giving Landlord written notice (“ Tenant’s Acceptance ”) on or

 

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before the date fifteen (15) days after Tenant receives Landlord’s Expansion Offer. If Tenant timely gives Tenant’s Acceptance, then Landlord shall lease the Acceptable Expansion Space described in Landlord’s Expansion Offer to Tenant, and Tenant shall demise such Acceptable Expansion Space from Landlord, on the terms and conditions set forth in Landlord’s Expansion Offer, the terms of Section 3.3(D), and upon all of the terms and conditions of the Lease to the extent not inconsistent with Landlord’s Expansion Offer; or

(ii) Tenant may, by giving Landlord written notice (“ Tenant’s Acceptance and Broker Determination Request ”) on or before the date fifteen (15) days after Tenant receives Landlord’s Expansion Offer, accept such Landlord’s Expansion Offer, but assert that the Base Rent offered in Landlord’s Expansion Offer is not the Prevailing Market Rent of the Acceptable Expansion Space specified in Landlord’s Expansion Offer, and request a Broker Determination of such Base Rent in accordance with Exhibit H . Tenant’s Acceptance and Broker Determination Request shall expressly accept Landlord’s Expansion Offer and state that Tenant requests a Broker Determination. If Tenant timely gives Tenant’s Acceptance and Broker Determination Request, then Tenant shall be conclusively be deemed to have accepted Landlord’s Expansion Offer, Landlord shall lease the Acceptable Expansion Space described in Landlord’s Expansion Offer to Tenant, and Tenant shall demise such Acceptable Expansion Space from Landlord, on the terms and conditions set forth in Landlord’s Expansion Offer and upon all of the terms and conditions of the Lease to the extent not inconsistent with Landlord’s Expansion Offer, except that the Base Rent payable by Tenant with respect to the Acceptable Expansion Space will be either as determined by the Broker Determination (and both parties shall be bound by such Broker Determination), or as mutually agreed to by the parties in writing,; or

(iii) Tenant may give written notice (“ Objection Notice ”) to Landlord asserting that the space identified in Landlord’s Expansion Offer does not qualify as Acceptable Expansion Space because it does not satisfy either the Size Condition and/or the Commencement Date Condition. If Tenant delivers a timely Objection Notice to Landlord and if the space identified in Landlord’s Expansion Offer does not, in fact, qualify as Acceptable Expansion Space, then Tenant may exercise Tenant’s Termination Right unless Landlord delivers an acceptable Landlord’s Expansion Offer to Tenant.

If Tenant does not, on or before the date fifteen (15) days after Tenant’s receipt of Landlord’s Expansion Offer, timely either give to Landlord a Tenant’s Acceptance, a Tenant’s Acceptance and Broker Determination Request, or an Objection Notice, then Tenant shall conclusively be deemed to have agreed that: (i) Landlord’s Expansion Offer offered to lease Acceptable Expansion Space to Tenant for purposes of satisfying the Tenant’s Expansion Needs Condition, and, therefore, (ii) Tenant has no right to exercise Tenant’s Termination Right.

 

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(F)

Acceptable Expansion Space Rescission Right . If the Commencement Date in respect of an Acceptable Expansion Space does not occur on or before the date one hundred fifty (150) days after the Estimated Commencement Date for such Acceptable Expansion Space, Tenant shall have the right (“ Tenant’s Acceptable Expansion Space Rescission Right ”) to cancel Tenant’s demise of such Acceptable Expansion Space. Tenant may exercise Tenant’s Acceptable Expansion Space Rescission Right by giving Landlord thirty (30) days written rescission notice (“ Tenant’s Acceptable Expansion Space Rescission Notice ”). If the Commencement Date with respect to such Acceptable Expansion Space occurs on or before the date (“ Acceptable Expansion Space Effective Cancellation Date ”) which is thirty (30) days after Landlord receives such Tenant’s Acceptable Expansion Space Rescission Notice, then Tenant’s Acceptable Expansion Space Rescission Notice shall be void and without force or effect, and Tenant shall have no right to cancel its demise of such Acceptable Expansion Space pursuant to this Section 3.5(F). If the Commencement Date with respect to such Acceptable Expansion Space does not occur on or before the date thirty (30) days after Landlord receives such Tenant’s Acceptable Expansion Space Rescission Notice, then the Tenant’s demise of such Acceptable Expansion Space shall be cancelled, and neither party shall have any further liability or obligation to the other party with respect to Tenant’s attempted demise of such Acceptable Expansion Space. The effect of Tenant’s exercise of Tenant’s Acceptable Expansion Space Rescission Right shall be the same as if Tenant had failed timely to accept Landlord’s offer to lease such Acceptable Expansion Space, except that, as provided in Section 3.5(C), Tenant’s Termination Right shall be revived.

 

(G)

Termination Payment . Subject to the provisions of this Section 3.5(F), the “ Termination Payment ” shall be equal to the sum of: (i) the Unamortized Portion, as hereinafter defined, of Landlord’s Transaction Costs, as hereinafter defined, plus (ii) the Rent Loss Payment, as hereinafter defined. The “ Rent Loss Payment ” shall be equal to $2,527,158.00, except that if (by reason of the exercise by Tenant of any of its Rescission Rights) the Effective Termination Date occurs after the last day of the seventh Lease Year, then the Rent Loss Payment shall be reduced by the amount of Base Rent to be paid by Tenant to Landlord between the last day of the seventh Lease Year and the Effective Termination Date.

 

(H)

Transaction Costs . “ Landlord’s Transaction Costs ” shall mean the following costs incurred by Landlord in connection with Tenant’s demise of the premises initially demised to Tenant: Landlord’s Contribution, any other costs incurred by Landlord in performing Landlord’s Work, brokerage commissions paid by Landlord in connection with Tenant’s demise of the premises initially demised to Tenant, and reasonable legal fees incurred by Landlord in connection with the Lease. “ Landlord’s Additional Premises Transaction Costs ” shall mean the following costs incurred by Landlord in connection with Tenant’s demise of any additional

 

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premises: any tenant allowances, any other costs incurred by Landlord in preparing such additional premises for Tenant’s occupancy, brokerage commissions paid by Landlord in connection with the Lease, and legal fees incurred by Landlord in connection with the Lease. Landlord shall, upon written request of Tenant, from time to time, advise Tenant of the amount of Landlord’s Transaction Costs and Landlord’s Additional Premises Transaction Costs, to the extent that such information is then available to Landlord and Landlord’s calculation of the Termination Payment.

 

(I)

Unamortized Portion . The “Unamortized Portion” shall be defined as the amount of principal which would remain unpaid as of the Effective Termination Date with respect to a loan in an original principal amount equal to the Landlord’s Transaction Costs (or Landlord’s Additional Premises Transaction Costs, as the case may be) and which is repaid in equal monthly payments of principal and interest on a direct reduction basis over the initial Term of the Lease with respect to the premises initially demised to Tenant (or the applicable additional premises, as the case may be) based upon an interest rate of six percent (6%) per annum.

 

(J)

If Tenant timely and properly exercises Tenant’s Termination Right and pays the entire Termination Fee, pursuant to this Section 3.5, then the Term of the Lease shall terminate as of the Effective Termination Date as if the Effective Termination Date were the Expiration Date set forth in Section 1.2, and Annual Fixed Rent and other charges shall be apportioned as of said Effective Termination Date. If Tenant fails timely and properly to give Tenant’s Termination Notice and to pay the first half of the Termination Fee, Tenant shall have no right to terminate the term of the Lease pursuant to this Section 3.5, time being of the essence hereof. If Tenant timely and properly gives Tenant’s Termination Notice and pays the first half of the Termination Fee, but Tenant fails timely to pay the Balance of the Termination Fee on or before the Effective Termination Date and if Tenant fails to cure such failure on or before the date ten (10) days after Tenant receives written notice of such failure from Landlord, then Landlord shall have the right, at Landlord’s election, to either : (i) declare Tenant’s Termination Notice void and of no force or effect, in which case Landlord shall apply the first half of the Termination Fee paid by Tenant as a credit against Tenant’s next succeeding obligation(s) to pay Annual Fixed Rent and other charges due under the Lease, or, (ii) to require Tenant to pay the balance of the Termination Fee, plus all legal fees incurred by Landlord in enforcing Tenant’s obligation to pay the Balance of the Termination Fee.

 

(K)

If Tenant exercises its Termination Right pursuant to this Section 3.5, Tenant shall have no right to extend the Term of the Lease pursuant to Section 3.2.

 

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ARTICLE IV

Condition of Premises; Alterations

 

4.0	Landlord’s Work

Landlord shall commence and diligently perform Landlord’s Work in accordance with the Work Agreement attached hereto as Exhibit B and made a part hereof. In addition to the performance of the Landlord’s Work, Landlord shall deliver the Premises to Tenant vacant, broom clean, free of all property, debris, Hazardous Materials, tenants or occupants. Subject to delays arising from Force Majeure, Landlord shall use diligent efforts to achieve Substantial Completion of Landlord’s Work on or before the Estimated Commencement Date. However, except as set forth in Section II of Exhibit B, the failure of the Commencement Date to occur on or before the Estimated Commencement Date shall in no way affect the validity of this Lease or the obligations of Tenant hereunder nor shall the same be construed in any way to extend the Term of this Lease. Except as set forth in Section II of Exhibit B, if the Commencement Date does not occur on or before the Estimated Commencement Date, Tenant shall not have any claim against Landlord, and Landlord shall have no liability to Tenant, by reason thereof.

ARTICLE V

Annual Fixed Rent and Electricity

 

5.1	Fixed Rent

Tenant agrees to pay to Landlord, commencing on the Commencement Date, and thereafter monthly, in advance, on the first day of each and every calendar month during the Original Lease Term, a sum equal to one-twelfth (1/12 ^th ) of the Annual Fixed Rent specified in Section 1.2 hereof for the applicable portion of the Term of this Lease and on the first day of each and every calendar month during each Extended Term (if exercised), a sum equal to one-twelfth of the Annual Fixed Rent as determined in Section 3.2 for the applicable Extended Term. Until notice of some other designation is given, fixed rent and all other charges for which provision is herein made shall be paid by remittance to or for the order of Boston Properties Limited Partnership either (i) by mail to P.O. Box 3557, Boston, Massachusetts 02241-3557, (ii) by wire transfer to Bank of America in Dallas, Texas, Bank Routing Number 0260-0959-3 or (iii) by ACH transfer to Bank of America in Dallas, Texas, Bank Routing Number 111 000 012, and in the case of (ii) or (iii) referencing Account Number 3756454460, Account Name of Boston Properties, LP, Tenant’s name and Atlantic Wharf address. All remittances received by BOSTON PROPERTIES LIMITED PARTNERSHIP, as Agents as aforesaid, or by any subsequently designated recipient, shall be treated as a payment to Landlord.

Annual Fixed Rent for any partial month shall be paid by Tenant to Landlord at such rate on a pro rata basis based on a 365 day year, and, if the Commencement Date shall be

 

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other than the first day of a calendar month, the first payment of Annual Fixed Rent which Tenant shall make to Landlord shall be a payment equal to a proportionate part of such monthly Annual Fixed Rent for the partial month from the Commencement Date to the first day of the succeeding calendar month.

Additional Rent payable by Tenant on a monthly basis, as elsewhere provided in this Lease, likewise shall be prorated, and the first payment on account thereof shall be determined in similar fashion and, if applicable at that time, shall commence on the Commencement Date and other provisions of this Lease calling for monthly payments shall be read as incorporating this undertaking by Tenant.

Notwithstanding that the payment of Annual Fixed Rent payable by Tenant to Landlord shall not commence until the Commencement Date, Tenant shall be subject to, and shall comply with, all other provisions of this Lease as and at the times provided in this Lease.

The Annual Fixed Rent and all other charges for which provision is made in this Lease shall be paid by Tenant to Landlord without setoff, deduction or abatement except as otherwise expressly set forth in this Lease.

 

5.2	Allocation of Electricity Charges

Landlord shall allocate the cost of electricity to Tenant in accordance with the procedure contained in Exhibit F , and Tenant shall pay for electricity as provided in said Exhibit F.

ARTICLE VI

Taxes

 

6.1	Definitions

With reference to the real estate taxes referred to in this Article VI, it is agreed that terms used herein are defined as follows:

 

(a)

“Tax Year” means the 12-month period beginning July 1 each year during the Lease Term or if the appropriate Governmental tax fiscal period shall begin on any date other than July 1, such other date with appropriate proration of any change.

 

(b)

“Landlord’s Tax Expenses Allocable to the Premises” means the same proportion of Landlord’s Tax Expenses as Rentable Floor Area of Tenant’s Premises bears to 100% of the Total Rentable Floor Area of the Building.

 

(c)

“Landlord’s Tax Expenses” with respect to any Tax Year means the aggregate “real estate taxes” (hereinafter defined) with respect to that Tax Year, reduced by any net abatement receipts with respect to that Tax Year but equitably adjusted to be a fully/assessed, fully occupied building.

 

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(d)

“Real estate taxes” means all taxes and special assessments of every kind and nature and user fees and other like fees assessed by any Governmental authority (including, but not limited to, any tax, assessment or charge resulting from the creation of a special improvement district, (but excluding any late fees unless Tenant is late with its payments)) on, or allocable to: (i) the Building (i.e., the Tower Office Unit and the Waterfront Office Unit, as defined in the Secondary Condominium Documents), and (ii) reasonable expenses of and fees for any formal or informal proceedings for negotiation or abatement of taxes (collectively, “Abatement Expenses”), which Abatement Expenses shall be excluded from Base Taxes. The amount of special taxes or special assessments to be included shall be limited to the amount of the installment (plus any interest other than penalty interest payable thereon) of such special tax or special assessment required to be paid on account of the tax year or portion thereof included with the Lease Term, payable over the longest period permitted by law. There shall be excluded from such taxes all mitigation or impact fees or subsidies associated with the initial construction of the Building or Atlantic Wharf and all income, inheritance, estate, succession, transfer, gift, franchise, or capital stock taxes; provided, however, that if at any time during the Lease Term the present system of ad valorem taxation of real property shall be changed so that in lieu of, or in addition to, the whole or any part of the ad valorem tax on real property (or in lieu of, or in addition to, any increases therein) there shall be assessed on Landlord a capital levy or other tax on the gross rents received with respect to the Site or Building or Property, or a federal, state, county, municipal, or other local income, franchise, excise or similar tax, assessment, levy or charge (distinct from any now in effect in the jurisdiction in which Atlantic Wharf is located) measured by or based, in whole or in part, upon any such gross rents, then any and all of such taxes, assessments, levies or charges, to the extent so measured or based, shall be deemed to be included within the term “Real Estate Taxes” but only to the extent that the same would be payable if the Site and Building, were the only property of Landlord. To the extent that the Building is not separately assessed for real estate tax purposes, but is assessed as part of a larger parcel including the Russia Building and the Garage, then the Landlord shall make a reasonable allocation in accordance with the Condominium Documents as to the amount of the real estate taxes that should be allocated to the Building for the purposes of determination of the Tenant’s share of increases in real estate taxes under this Lease. The Landlord’s allocation, if made in good faith, shall be final. For the purposes of this Lease, real estate taxes shall include any legally required payment in lieu of taxes or any payments made under Chapter 121A of the Massachusetts General Laws or any similar law, provided that any such payments in lieu of taxes shall be included solely to the extent any such agreement is consistent with

 

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agreements then required to be entered into in the City of Boston for comparable properties, but shall not be included in real estate taxes to the extent any such agreement is not so required or consistent.

 

(e)

“Base Taxes” means Landlord’s Tax Expenses (hereinbefore defined) for fiscal tax year 2012 (that is the period beginning July 1, 2011 and ending June 30, 2012), provided, however, the Base Taxes shall be equitably adjusted and grossed up as if the Building (or the applicable portion of Atlantic Wharf on which Base Taxes are based) were to be a fully assessed, fully occupied building. Landlord represents and warrants to Tenant that, as of the Execution Date of this Lease, there are no tax agreements, tax credits, tax abatements or other tax incentives applicable to the Base Taxes for the Building which expire or terminate during the Term of this Lease.

 

(f)

“Base Taxes Allocable to the Premises” means the same proportion of Base Taxes as the Rentable Floor Area of Tenant’s Premises bears to 100% of the Total Rentable Floor Area of the Building.

 

(g)

If during the Lease Term the Tax Year is changed by applicable law to less than a full 12-month period, the Base Taxes and Base Taxes Allocable to the Premises shall each be proportionately reduced.

 

6.2	Tenant’s Share of Real Estate Taxes

If with respect to any full Tax Year or fraction of a Tax Year falling within the Lease Term Landlord’s Tax Expenses Allocable to the Premises for a full Tax Year exceed Base Taxes Allocable to the Premises or for any such fraction of a Tax Year exceed the corresponding fraction of Base Taxes Allocable to the Premises (such amount being hereinafter referred to as the “Tax Excess”), then Tenant shall pay to Landlord, as Additional Rent, the amount of such Tax Excess. Payments by Tenant on account of the Tax Excess shall be made monthly at the time and in the fashion herein provided for the payment of Annual Fixed Rent. The amount so to be paid to Landlord shall be an amount from time to time reasonably estimated by Landlord to be sufficient to provide Landlord, in the aggregate, a sum equal to the Tax Excess, ten (10) days at least before the day on which tax payments by Landlord would become delinquent. Not later than ninety (90) days after Landlord’s Tax Expenses Allocable to the Premises are determinable for the first such Tax Year or fraction thereof and for each succeeding Tax Year or fraction thereof during the Lease Term, Landlord shall render Tenant a statement in reasonable detail certified by a representative of Landlord showing for the preceding year or fraction thereof, as the case may be, real estate taxes allocated to the Building, abatements and refunds, if any, of any such taxes and assessments, expenditures incurred in seeking such abatement or refund, the amount of the Tax Excess, the amount thereof already paid by Tenant and the amount thereof overpaid by, or remaining due from, Tenant for the period covered by such statement, together with copies of all of the tax bills from the City of Boston on which such calculations are based. Landlord shall provide Tenant with a

 

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statement of the amount of Taxes included in Base Taxes following the conclusion of the Base Tax Year, and if requested by Tenant together with copies of all of the tax bills from the City of Boston on which such calculations are based. Within thirty (30) days after the receipt of such statement, Tenant shall pay any sum remaining due. Any balance shown as due to Tenant shall be credited against Annual Fixed Rent next due, or refunded to Tenant if the Lease Term has then expired and Tenant has no further obligation to Landlord. Reasonable expenditures for legal fees and for other expenses incurred in obtaining an abatement or refund may be charged against the abatement or refund before the adjustments are made for the Tax Year.

To the extent that real estate taxes shall be payable to the taxing authority in installments with respect to periods less than a Tax Year, the statement to be furnished by Landlord shall be rendered and payments made on account of such installments.

Landlord shall, within thirty (30) days after Landlord receives written notice from the Tax Assessor of the City of Boston setting forth the assessed value of the Building for the Base Tax Year, provide to Tenant a written statement of the amount of assessed value of the Building which Landlord intends to use as the basis for Base Taxes and the manner in which Landlord determined such amount. After Landlord delivers such statement to Tenant, the parties shall meet at a mutually acceptable time to discuss Landlord’s determination of such assessed value.

ARTICLE VII

Landlord’s Repairs and Services and Tenant’s Escalation Payments

 

7.1	Structural Repairs; Water Tightness

Except for damage caused by fire or casualty or by eminent domain which shall be covered by Article XIV of this Lease, Landlord shall, throughout the Lease Term, at Landlord’s sole cost and expense, keep and maintain, or cause to be kept and maintained, in good order, condition and repair generally and reasonably consistent with other high quality Class A office buildings in the Central Business District in Boston and in conformance with all Legal Requirements, including necessary capital repairs and replacements, the following portions of the Building: all structural and non-structural portions and components of the roof systems (including roof membranes), the exterior and load bearing walls, the foundation, the structural columns, mullions, floor/ceiling slabs, exterior glass, shafts and other structural elements of the Building and the reasonable weatherizing of the Building; provided however, that, subject to Section 13.13, Tenant shall pay to Landlord, as Additional Rent, the cost of any and all such repairs which may be required as a result of repairs, alterations, or installations made by Tenant or any subtenant, assignee, licensee or concessionaire of Tenant or any agent, servant, employee or contractor of any of them or to the extent of any loss, destruction or damage caused by the negligent act or omission of Tenant, any assignee or subtenant or any agent, servant, employee, customer, visitor or contractor of any of them.

 

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7.2	Other Repairs to be Made by Landlord

Except for damage caused by fire or casualty or by eminent domain which shall be covered by Article XIV of this Lease, and except as otherwise provided in this Lease, and subject to provisions for reimbursement by Tenant as contained in Section 7.5, Landlord agrees to keep and maintain, or cause to be kept and maintained, in good order, condition and repair generally and reasonably consistent with other high quality Class A office buildings in the Central Business District in Boston and in conformance with all Legal Requirements, the common areas and facilities of the Building, including the base building mechanical, electrical, plumbing, sprinkler, fire/life safety, and access control systems and the base building heating, ventilating, and air conditioning (“Base Building HVAC”) systems serving the Premises and the Building and other common Building systems equipment servicing the Premises, except that Landlord shall in no event be responsible to Tenant for (a) subject to Section 13.13, the condition of glass in and about the Premises (other than for glass in exterior walls for which Landlord shall be responsible unless the damage thereto is attributable to Tenant’s negligence or misuse, in which event the responsibility for the cost thereof shall be Tenant’s), or (b) subject to Section 13.13, any condition in the Premises or the Building caused by any act or neglect of Tenant or any agent, employee, contractor, assignee, subtenant, licensee, concessionaire or invitee of Tenant. Without limitation, Landlord shall not be responsible to make any improvements or repairs to the Building or the Premises other than as expressly provided in Section 7.1 or in this Section 7.2, unless expressly otherwise provided in this Lease or the Condominium Documents. Landlord shall perform Landlord’s obligations under the Condominium Documents and shall use reasonable efforts to enforce the obligations of the Tower Office Unit owner and the Commercial Unit Owner under the Condominium Documents to the extent that such obligations affect Tenant.

 

7.3	Services to be Provided by Landlord

In addition, and except as otherwise provided in this Lease and subject to provisions for reimbursement by Tenant as contained in Section 7.5 and Tenant’s responsibilities in regard to electricity as provided in Section 5.2, Landlord agrees to furnish services, utilities, facilities and supplies to the Premises and the Building as set forth in Exhibit C hereto equal in quality comparable to those customarily provided by landlords in high quality Class A buildings in Boston. In addition, Landlord agrees to furnish, at Tenant’s expense, reasonable additional Building operation services which are usual and customary in similar buildings in Boston, and such additional special services as may be mutually agreed upon by Landlord and Tenant, upon reasonable and equitable rates from time to time established by Landlord. Tenant agrees to pay to Landlord, as Additional Rent, the cost of any such additional Building services requested by Tenant and for the cost of any additions, alterations, improvements or other work performed by Landlord in the Premises at the request of Tenant within thirty (30) days after being billed therefor. Landlord represents to Tenant that, as of the Execution Date, there are two zones for overtime Base Building HVAC services and tenants are charged for overtime Base Building HVAC service based upon an hourly charge relating to the applicable zoning and floor to which such service is provided.

 

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7.4	Operating Costs Defined

“Operating Expenses Allocable to the Premises” means the same proportion of the Operating Expenses for the Building (as hereinafter defined) as Rentable Floor Area of the Premises bears to 100% of the Total Rentable Floor Area of the Building. “Base Operating Expenses” means Operating Expenses for the Building for calendar year 2012 (that is the period beginning January 1, 2012 and ending December 31, 2012 (the “Base Year”)). Base Operating Expenses shall not include market-wide cost increases due to extraordinary circumstances, including but not limited to, Force Majeure (as defined in Section 14.1), boycotts, strikes, conservation surcharges, embargoes or shortages. For purposes of this Section 7.4, “market-wide cost increases due to extraordinary circumstances” shall mean an actual, material increase in a category of Landlord’s Operating Expenses under this Lease in excess of the amount reasonably budgeted by Landlord for such expense category in the Base Operating Expenses which is attributable to some unanticipated event or circumstance occurring during the Base Year and that affects the Central Business District of the City of Boston in general for a temporary period of time and where the costs for such category(ies) subsequently returns, within not more than nine (9) months after the calendar year used for calculating Base Operating Expenses, to amounts that would otherwise have been consistent with the projected and normal level of increases in such category(ies) of costs during subsequent years of the Term. If there are elements of Building repair and maintenance which would have been included in Base Operating Expenses except that such repair and maintenance is covered under construction or installation warranties or service contracts, then the costs which would have been incurred but for such warranties or service contracts shall be included in Base Operating Expenses, less the reasonable costs incurred by Landlord in enforcing such warranties and less the cost of any such service contracts. “Base Operating Expenses Allocable to the Premises” means the same proportion of Base Operating Expenses as the Rentable Floor Area of Tenant’s Premises bears to 100% of the Total Rentable Floor Area of the Building. “Operating Expenses for the Building” means the cost of operation of the Building and the Building’s share (allocated per the Condominium Documents) of the cost of operating the common areas of Atlantic Wharf as more specifically provided below in Section 7.4, including those incurred in discharging the obligations under Sections 7.2 and 7.3; however there shall be excluded from the Operating Expenses for the Building all costs solely relating to the operation and maintenance of the Garage or the retail and residential portions of Atlantic Wharf. In no event shall Landlord have the right to include in Operating Expenses for the Building more than 100% of the Building’s allocable share of any Operating Expense and, so long as Landlord is operating the multi-media center in accordance with the requirements of the Chapter 91 license applicable to Atlantic Wharf (as the same may be modified by amendment or waiver), all revenue and user fees collected from use of the multi-media center shall be credited against the operating expenses of such facility. In addition, such costs shall exclude payments of debt service and any other mortgage charges, brokerage commissions, real estate taxes (to the extent paid pursuant to Section 6.2 hereof), and costs of special services rendered to tenants (including Tenant) for which a separate charge is made, but shall include, without limitation:

 

Page 30

(a)

compensation, wages and all fringe benefits, workmen’s compensation insurance premiums and payroll taxes paid to, for or with respect to all persons up to and including the level of Regional Property Manager for their services in the operating, maintaining, managing, insuring or cleaning of the Building. To the extent, if any, that any such persons shall perform any work with respect to the Building and other buildings in or common areas of Atlantic Wharf or other properties of Landlord or its affiliates, there shall be a reasonable allocation to the Building of the aforesaid charges and items payable to such persons among other buildings, areas and properties so served;

 

(b)

payments under service contracts with independent contractors for operating, maintaining or cleaning of the Building;

 

(c)

steam, water, sewer, gas, oil, electricity and telephone charges (excluding such utility charges separately chargeable to tenants for additional or separate services and excluding electricity for plugs, lights and supplemental heating, ventilating and air-conditioning supplied to leasable areas of the Building) and costs of maintaining letters of credit or other security as may be required by utility companies as a condition of providing such services;

 

(d)

cost of maintenance, cleaning and repairs and replacements (other than repairs not properly chargeable against income or reimbursable from contractors under guarantees);

 

(e)

cost of snow removal and the cost of landscaping services;

 

(f)

cost of building and cleaning supplies and equipment;

 

(g)

premiums for insurance carried with respect to the Building (including, without limitation, liability insurance, insurance against loss in case of fire or casualty and of monthly installments of Annual Fixed Rent and any Additional Rent which may be due under this Lease and other leases of space in the Building for not more than twelve (12) months in the case of both Annual Fixed Rent and Additional Rent and, if there be any first mortgage on the Building, including such insurance as may be required by the holder of such first mortgage); provided, however, that: (i) so long as an affiliate of Boston Properties Limited Partnership owns the Building, such coverages are consistent with those carried by other affiliates of Boston Properties Limited Partnership which own properties similar to the Building in the greater Boston area, and (ii) during such period of time as the Building is not owned by an affiliate of Boston Properties Limited,

 

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Partnership, such coverages shall be of the type and amounts customarily required to be carried by lenders of comparable class A, multi-tenant office buildings in Central Business District of the City of Boston;

 

(h)

management fees at reasonable rates for self managed buildings consistent with the type of occupancy and the services rendered, but in no event at a rate of more than four percent (4%) of fixed and additional rent scheduled for the Building (excluding Tenant electricity reimbursements), parking fees and the aforesaid management fees), the parties agreeing that in calculating the amount of management fees included in Operating Expenses for any calendar year (including the Base Year), management fees shall grossed up as if the Building were 95% occupied (i.e., determined as full rent were being paid on any space which is vacant during such year and on any space with respect to which the tenant is receiving the benefit of free rent or rent abatements);

 

(i)

the Building’s share (determined in accordance with the Condominium Documents) of Operating Expenses (as herein defined in this Section 7.4) related to the operation (and insurance) of the open areas, interior and exterior public areas and amenities, plazas, common areas, facilities and other non-leasable areas of Atlantic Wharf including the Lot, and the Public Spaces (but not including any portion of the Russia Building) and other mixed use common area maintenance costs incurred by Landlord or any other owner and allocated to the Building and any shuttle buses and other like amenities, for use of tenants of the Building either alone or in common with tenants of other buildings in Atlantic Wharf and any contributions or payments respecting the Rose Kennedy Greenway;

 

(j)

depreciation for capital expenditures made by Landlord during the Lease Term but only with respect to capital expenditures incurred (x) to reduce Operating Expenses if Landlord reasonably shall have determined that the annual reduction in Operating Expenses shall exceed depreciation therefor or (y) to comply with Legal Requirements effective after the date of this Lease (the capital expenditures described in subsections (x) and (y) being hereinafter referred to as “Permitted Capital Expenditures”) plus, in the case of both (x) and (y), an interest factor, reasonably determined by Landlord, as being the interest rate then charged for long term mortgages by institutional lenders on like properties within the general locality in which the Building is located, and depreciation in the case of both (x) and (y) shall be determined by dividing the original cost of such capital expenditure by the number of years of useful life of the capital item acquired, which useful life shall be determined reasonably by Landlord in accordance with generally accepted accounting principles and practices in effect at the time of acquisition of the capital item; provided, however, if Landlord reasonably concludes on the basis of engineering estimates that a particular capital expenditure will effect savings in other Operating

 

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Expenses, including, without limitation, energy related costs, and that such projected savings will, on an annual basis (“Projected Annual Savings”), exceed the annual depreciation therefor, then and in such event the amount of depreciation for such capital expenditure shall be increased to an amount equal to the Projected Annual Savings; and in such circumstance, the increased depreciation (in the amount of the Projected Annual Savings) shall be made for such period of time as it would take to fully amortize the cost of the item in question, together with interest thereon at the interest rate as aforesaid in equal monthly payments, each in the amount of 1/12th of the Projected Annual Savings, with such payment to be applied first to interest and the balance to principal; and

 

(k)

all other reasonable and necessary expenses paid in connection with the operating, cleaning and maintenance of the Building or said common areas and facilities of the Building consistent with other high quality Class A buildings in the Central Business District of Boston and properly chargeable against income.

Notwithstanding anything in this Lease to the contrary, to the extent that Landlord provides or procures services for the Building together with other buildings in Atlantic Wharf or otherwise operated by Landlord or any affiliate thereof, then the costs of such services shall be allocated between the Building and such other buildings in a manner reasonably determined by Landlord.

Notwithstanding any of the foregoing, all of the items of expense listed in Exhibit M attached hereto and made a part hereof entitled Operating Expense Exclusions, are excluded from Operating Expenses.

Notwithstanding the foregoing, in determining the amount of Operating Expenses for the Building for any calendar year or portion thereof falling within the Lease Term (including the calendar year in which Base Operating Expenses are determined), if less than one hundred percent (100%) of the Total Rentable Floor Area of the Building shall have been occupied by tenants at any time during the period in question, then, with respect to the Base Year then, at Landlord’s election, with respect to years after the Base Year, but on a mandatory basis for the Base Year, those components of Operating Expenses for the Building that vary based on occupancy for such period shall be adjusted to equal the amount such components of Operating Expenses for the Building would have been for such period had occupancy been one hundred percent (100%) throughout such period.

 

7.5	Tenant’s Escalation Payments

 

(A)

If with respect to any calendar year falling within the Lease Term, or fraction of a calendar year falling within the Lease Term at the beginning or end thereof, the Operating Expenses Allocable to the Premises (as defined in Section 7.4) for a full calendar year exceed Base Operating Expenses Allocable to the Premises (as

 

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defined in Section 7.4) or for any such fraction of a calendar year exceed the corresponding fraction of Base Operating Expenses Allocable to the Premises (such amount being hereinafter referred to as the “Operating Cost Excess”), then Tenant shall pay to Landlord, as Additional Rent, on or before the thirtieth (30 th ) day following receipt by Tenant of the statement referred to below in this Section 7.5, the amount of such Operating Cost Excess.

 

(B)

Estimated payments by Tenant on account of the Operating Cost Excess shall be made monthly at the time and in the fashion herein provided for the payment of Annual Fixed Rent. The amount so to be paid to Landlord shall be an amount reasonably estimated by Landlord in writing to Tenant from time to time (but no more than twice in any calendar year) to be sufficient to cover, in the aggregate, a sum equal to the Operating Cost Excess for each calendar year during the Lease Term.

 

(C)

No later than one hundred twenty (120) days after the end of the first calendar year or fraction thereof ending December 31 and of each succeeding calendar year during the Lease Term or fraction thereof at the end of the Lease Term, Landlord shall render Tenant a statement in reasonable detail and according to usual accounting practices consistently applied and certified by a representative of Landlord, showing for the preceding calendar year or fraction thereof, as the case may be, the Operating Expenses for the Building and the Operating Expenses Allocable to the Premises. The first such Operating Expense Statement from Landlord under this Lease shall also set forth the Base Operating Expenses and the Base Operating Expenses Allocable to the Premises. Said statement to be rendered to Tenant also shall show for the preceding year or fraction thereof, as the case may be, the amounts already paid by Tenant on account of Operating Cost Excess and the amount of Operating Cost Excess remaining due from, or overpaid by, Tenant for the year or other period covered by the statement.

If such statement shows a balance remaining due to Landlord, Tenant shall pay same to Landlord on or before the thirtieth (30 ^th ) day following receipt by Tenant of said statement. Any balance shown as due to Tenant shall be credited against Annual Fixed Rent next due, or refunded to Tenant within thirty (30) days if the Lease Term has then expired and Tenant has no further obligation to Landlord.

Any payment by Tenant for the Operating Cost Excess shall not be deemed to waive any rights of Tenant to claim that the amount thereof was not determined in accordance with the provisions of this Lease.

 

(D)

In the event of any dispute regarding the amount due as Tenant’s Operating Cost Excess, Tenant shall have the right, after reasonable notice and at reasonable times during normal business hours, to inspect and photocopy Landlord’s accounting records relating to the Operating Costs Excess for the period in question at Landlord’s office in Boston, MA, provided Tenant shall exercise such right with respect to any calendar year by giving such notice to Landlord within

 

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one hundred (100) days after Tenant shall receive a bill or reconciliation from Landlord concerning Operating Costs for such calendar year. Notwithstanding the foregoing, if Tenant has not previously exercised its right, pursuant to this Paragraph (D), to examine Landlord’s accounting records relating to Operating Costs Excess for calendar year 2012, Tenant shall have the right to make such examination at the same time that Tenant properly exercises its right to examine Landlord’s accounting records relating to Operating Costs Excess for calendar year 2013 or 2014. Time is of the essence as to any notice. Further, in no event shall Tenant have the right to make any such examination (whether by itself or with an examiner) more than once in respect of any year in which Landlord has given Tenant a statement of Operating Costs, unless review of a subsequent period gives rise to the disclosure of a miscalculation or error that may apply to any of the two (2) calendar years prior to the calendar year for which such miscalculation or error has been discovered; provided, however that if any such prior calendar year was subject to a previous examination, then no further review of such prior calendar year shall be permitted. If, after such inspection and photocopying, Tenant continues to dispute the amount of its Operating Cost Excess, Tenant or an independent professional firm designated by Tenant (including FHO Partners) shall be entitled to audit and/or review Landlord’s records relating to the period in question with respect to the proper amount of Operating Cost Excess; provided that no auditor engaged by Tenant shall be paid on a contingent fee basis. As a condition to performing any such examination, Tenant and its examiners shall be required to execute and deliver to Landlord a commercially reasonable agreement, in form reasonably acceptable to Landlord, agreeing to keep confidential any information about Landlord or the Building obtained in the course of such examination.

If such audit or review reveals that Landlord has overcharged Tenant, then within thirty (30) days after the results of such audit are made available to Landlord, Landlord shall reimburse Tenant the amount of such overcharge plus interest thereon at the Lease Interest Rate. If the audit reveals that Tenant was undercharged, then within thirty (30) days after the results of the audit are made available to Tenant, Tenant shall reimburse Landlord the amount of such undercharge plus interest thereon at the Lease Interest Rate. If Landlord desires to contest such audit results, Landlord may do so by submitting the results of the audit to arbitration pursuant to the then current rules and procedures of the American Arbitration Association within sixty (60) days of receipt of the results of the audit, and the arbitration shall be final and binding upon Landlord and Tenant. The cost of the arbitrator engaged in connection with such arbitration shall be shared equally between the parties.

Tenant agrees to pay the cost of its own audit, provided that if the audit reveals that Landlord’s determination of Operating Cost Excess as set forth in any statement sent to Tenant was in error in Landlord’s favor by more than Ten Thousand Dollars ($10,000.00), Landlord shall pay the cost of such audit. Landlord shall provide Tenant with a statement of the Operating Costs incurred in

 

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the Base Year following the conclusion of the such Base Year, and Tenant’s audit right shall include but not be limited to the right to audit and review Landlord’s records with respect to such Base Year.

 

7.6

No Damage

Landlord shall not be liable to Tenant for any compensation or reduction of rent by reason of inconvenience or annoyance or for loss of business arising from the necessity of Landlord or its agents entering the Premises for any purposes in this Lease authorized, or for repairing the Premises or any portion of the Building or Atlantic Wharf however the necessity may occur provided that except in case of emergency repairs, Landlord will give Tenant reasonable advance notice of any contemplated stoppage or entry (except in the event of emergencies and in connection with normal cleaning and maintenance operations) and will use reasonable efforts to avoid unnecessary inconvenience to Tenant by reason thereof. Except in the event of an emergency, Tenant may have the right to have an employee or other representative of Tenant accompany Landlord when Landlord is making such entry. In exercising any right which Landlord has to enter the Premises, Landlord shall use reasonable efforts to minimize any interference with Tenant’s use of the Premises. In case Landlord is prevented or delayed from making any repairs, alterations or improvements, or furnishing any services or performing any other covenant or duty to be performed on Landlord’s part, by reason of any cause reasonably beyond Landlord’s control, including, without limitation, by reason of Force Majeure (as defined in Section 14.1 hereof) or for any cause due to any act or neglect of Tenant or Tenant’s servants, agents, employees, licensees or any person claiming by, through or under Tenant, Landlord shall not be liable to Tenant therefor, nor, except as expressly otherwise provided in this Lease, shall Tenant be entitled to any abatement or reduction of rent by reason thereof, or right to terminate this Lease, nor shall the same give rise to a claim in Tenant’s favor that such failure constitutes actual or constructive, total or partial, eviction from the Premises.

Landlord reserves the right to stop any service or utility system, when necessary by reason of accident or emergency, or until necessary repairs have been completed; provided, however, that in each instance of stoppage, Landlord shall exercise reasonable diligence to eliminate the cause thereof. Except in case of emergency repairs, Landlord will give Tenant reasonable advance notice of any contemplated stoppage and will use reasonable efforts to avoid unnecessary inconvenience to Tenant by reason thereof.

Notwithstanding the foregoing, and solely for the purposes of this Section 7.6, an “Abatement Event” shall be defined as an event or circumstance where a portion of the Premises becomes untenantable and Tenant ceases to occupy such portion of the Premises resulting from or caused by: (i) any repairs, alterations, replacements or improvements made by Landlord, (ii) Landlord’s failure to make any repairs, alterations, or improvements required to be made by Landlord hereunder, or to provide any service required to be provided by Landlord hereunder, or to remediate any Hazardous Materials, as defined in Section 11.2 and provided that such Hazardous Materials were not used, stored, or disposed of by Tenant, anyone claiming by, through or under Tenant, or any of

 

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their respective agents, employees or contractors, or (iii) any failure of Landlord to provide electrical, heating, ventilating, air conditioning, or all elevator service to the Premises or reasonable access to the Premises. Tenant shall give Landlord notice (“Abatement Notice”) of any such Abatement Event, and if such Abatement Event continues beyond the “Eligibility Period” (as that term is defined below), then the Annual Fixed Rent and Tenant’s payments on account of Landlord’s Tax Expenses Allocable to the Premises and Operating Expenses Allocable to the Premises shall be abated entirely or reduced, as the case may be, after expiration of the Eligibility Period for such time that Tenant continues to be so prevented from using, and does not use, the Premises or a portion thereof, in the proportion that the rentable area of the portion of the Premises that Tenant is prevented from using, and does not use, bears to the total Rentable Floor Area of the Premises. The term “Eligibility Period” shall mean (i) as the result of an Abatement Event due to an event or circumstance within Landlord’s reasonable control, a period of three (3) consecutive days after Landlord’s receipt of any Abatement Notice(s) and (ii) as the result of an Abatement Event due to an event or circumstance not within Landlord’s reasonable control, a period of fifteen (15) consecutive days after Landlord’s receipt of any Abatement Notice(s). Notwithstanding anything herein contained to the contrary, in no event shall any of the events referred to in this Section 7.6 give rise to a claim in Tenant’s favor that such failure constitutes actual or constructive, total or partial, eviction from the Premises

ARTICLE VIII

Tenant’s Repairs

 

8.1	Tenant’s Repairs and Maintenance

Tenant covenants and agrees that, from and after the date that possession of the Premises is delivered to Tenant and until the end of the Lease Term, (except during construction of Tenant’s Work (which shall be governed by Work Letters).Tenant will keep neat and clean and maintain in good order, condition and repair the Premises and every part thereof, excepting only for those repairs or other obligations for which Landlord is responsible under the terms of Article VII of this Lease conditions caused by the negligence or willful misconduct of Landlord or its employees, agents or contractors, and damage by fire or casualty and as a consequence of the exercise of the power of eminent domain. Tenant shall not permit or commit any waste, and, subject to Section 13.13, Tenant shall be responsible for the cost of repairs which may be made necessary by reason of damages to common areas in the Building or at Atlantic Wharf by Tenant, Tenant’s agents, employees, contractors, sublessees, licensees, concessionaires or invitees (other than ordinary wear and tear). Tenant shall maintain all its equipment, furniture and furnishings in good order and repair.

If repairs are required to be made by Tenant pursuant to the terms hereof, Landlord may demand that Tenant make the same forthwith, and, subject to the next following sentence, if Tenant refuses or neglects to commence such repairs and complete the same within

 

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thirty (30) days after written notice (or such longer period of time as Tenant may reasonably require to complete the same, provided that Tenant commences to perform such repairs within such thirty (30) day period and thereafter diligently prosecutes such repairs to completion), Landlord may (but shall not be required to do so) make or cause such repairs to be made and shall not be responsible to Tenant for any loss or damage that may accrue to Tenant’s stock or business by reason thereof except to the extent of the negligence or willful misconduct of any Landlord Parties. Notwithstanding the foregoing, in emergencies, Landlord may exercise its rights under the immediately preceding sentence without prior notice to Tenant. If Landlord makes or causes such repairs to be made, Tenant agrees that Tenant will forthwith within thirty (30) days of Landlord’s demand, pay to Landlord as Additional Rent the cost thereof together with interest thereon at the rate specified in Section 16.21, and if Tenant shall default in such payment, Landlord shall have the remedies provided for non-payment of rent or other charges payable hereunder.

ARTICLE IX

Alterations

 

9.1	Landlord’s Approval

Tenant covenants and agrees not to make alterations, additions or improvements to the Premises (other than Cosmetic Alterations, as hereinafter defined), whether before or during the Lease Term, except in accordance with plans and specifications therefor first approved by Landlord in writing, which approval shall not be unreasonably withheld or delayed. However, Landlord’s determination of matters relating to aesthetic issues relating to alterations, additions or improvements which are visible outside the Premises shall be in Landlord’s sole discretion. Without limiting such standard, Landlord shall not be deemed unreasonable:

 

(a)

for withholding approval of any alterations, additions or improvements which (i) in Landlord’s opinion might materially and adversely affect any structural element of the Building or which might affect any exterior element of the Building, any area or element outside of the Premises or might materially and adversely affect any facility or base building mechanical system serving any area of the Building outside of the Premises, or (ii) involve or affect the exterior design, size, height or other exterior dimensions of the Building, or (iii) enlarge the Rentable Floor Area of the Premises, or (iv) are inconsistent, in Landlord’s good faith judgment, with alterations satisfying Landlord’s reasonable standards which do not discriminate between similarly situated tenants for new alterations in the Building, or (v) will require unusual expense to readapt the Premises to normal office use on Lease termination or increase the cost of construction or of insurance or taxes on the Building or of the services called for by Section 7.3 unless Tenant first gives assurance reasonably

 

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acceptable to Landlord for payment of such increased cost and that such readaptation will be made prior to such termination without expense to Landlord.

 

(b)

for making its approval conditional on Tenant’s agreement to restore the Premises to its condition prior to such alteration, addition, or improvement at the expiration or earlier termination of the Lease Term. Notwithstanding anything to the contrary herein contained, Landlord agrees that Tenant will not be required to remove any alterations, additions, or improvements which: (i) are found in typical business offices in the Central Business District of the City of Boston, and (ii) are not, in Landlord’s reasonable judgment, unusual costly to remove and restore. Without limiting the foregoing, Landlord shall, in any event, have the right to require Tenant to remove internal staircases and Cable. If Tenant makes any alterations, additions or improvements to the Premises, then Landlord may, except as provided above, elect to require Tenant at the expiration or sooner termination of the Term of this Lease to restore the Premises to substantially the same condition as existed at the Commencement Date. If Tenant so requests in writing at the time that Tenant requests Landlord’s approval of such alterations, additions or improvements, Landlord agrees to make such election at the time that Landlord approves Tenant’s plans for any such alterations, additions or improvements.

Landlord’s review and approval of any such plans and specifications or under Exhibit B and consent to perform work described therein shall not be deemed an agreement by Landlord that such plans, specifications and work conform with applicable Legal Requirements and requirements of insurers of the Building and the other requirements of the Lease with respect to Tenant’s insurance obligations (herein called “ Insurance Requirements ”) nor be deemed a waiver of Tenant’s obligations under this Lease with respect to applicable Legal Requirements and Insurance Requirements nor impose any liability or obligation upon Landlord with respect to the completeness, design sufficiency or compliance of such plans, specifications and work with applicable Legal Requirements and Insurance Requirements. Further, Tenant acknowledges that Tenant is acting for its own benefit and account, and that Tenant shall not be acting as Landlord’s agent in performing any work in the Premises; accordingly, no contractor, subcontractor or supplier shall have a right to lien Landlord’s interest in Atlantic Wharf in connection with any such work. Within 30 days after receipt of an invoice from Landlord, Tenant shall pay to Landlord, as a fee for Landlord’s review of any plans or work (excluding any review respecting initial improvements performed pursuant to Exhibit B or other improvements for which a fee had previously been paid, but including any review of plans or work relating to any assignment or subletting), as Additional Rent, an amount equal to the sum of : (i) $150.00 per hour for technical reviews performed in-house by Landlord’s professional staff, plus (ii) if Landlord reasonably determines that a third-party consultant is needed to review such work or plans, then Tenant shall reimburse Landlord for the reasonable third-party out-of-pocket costs incurred by Landlord in hiring said third party to review Tenant’s plans and Tenant’s work.

 

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Notwithstanding anything to the contrary herein contained, Tenant shall have the right, without obtaining Landlord’s consent, to either: (x) make cosmetic interior nonstructural alterations, additions or improvements other than installing paint and carpet, the cost of which do not exceed Four Hundred Thousand and 00/100 ($400,000.00) Dollars, or (y) install paint and carpet (collectively “ Cosmetic Alterations ”), provided however that:

 

(i)

Tenant shall give prior written notice to Landlord of such Cosmetic Alterations;

 

(ii)

Tenant shall submit to Landlord plans for such Alterations if Tenant utilizes plans for such Cosmetic Alterations; and

 

(iii)

such Cosmetic Alterations shall not materially affect any of the Building’s systems, or the ceiling of the Premises.

Upon and subject to the provisions of this Lease, Tenant may construct internal staircases between floors within the Premises that are located in the Waterfront Office Building and Tenant shall have the right to select the location of such internal staircases, subject to Tenant’s obtaining Landlord’s prior written approval, which shall not be unreasonably withheld, conditioned, or delayed.

 

9.2	Conformity of Work

Tenant covenants and agrees that any alterations, additions, improvements or installations made by it to or upon the Premises shall be done in a good and workmanlike manner and in compliance with all applicable Legal Requirements and Insurance Requirements now or hereafter in force, that materials of first and otherwise good quality shall be employed therein, that the structure of the Building shall not be endangered or impaired thereby and that the Premises shall not be diminished in value thereby.

 

9.3	Performance of Work, Governmental Permits and Insurance

All of Tenant’s alterations and additions and installation of furnishings shall be coordinated with any work being performed by or for Landlord and in such manner as to maintain harmonious labor relations and not to damage the Building or Atlantic Wharf or interfere with Building construction or operation and, except for installation of furnishings, shall be performed by Landlord’s general contractor or by contractors or workers first approved by Landlord, as to which Landlord agrees to act reasonably. Except for work by Landlord’s general contractor, Tenant shall procure all necessary governmental permits before making any repairs, alterations, other improvements or installations. Tenant agrees to save harmless and indemnify Landlord from any and all injury, loss, claims or damage to any person or property occasioned by or arising out of the doing of any such work whether the same be performed prior to or during the Term of

 

Page 40

this Lease. At Landlord’s election, as to which Landlord agrees to act reasonably, with respect only to alterations costing in excess of Two Hundred Fifty Thousand and 00/100 Dollars ($250,000.00) and excluding Cosmetic Alteration and Landlord’s Work, Tenant shall cause its contractor to maintain a payment and performance bond in such amount and with such companies as Landlord shall reasonably approve. In addition, Tenant shall cause each contractor to carry insurance in accordance with Section 13.14 hereof and to deliver to Landlord certificates of all such insurance. Tenant shall also prepare and submit to Landlord a set of record drawings in accordance with the requirements of paragraph 18 of Exhibit B-1, in both print and electronic forms, showing such work performed by Tenant to the Premises promptly after any such alterations, improvements or installations are substantially complete and promptly after any wiring or cabling for Tenant’s computer, telephone and other communications systems is installed by Tenant or Tenant’s contractor. Without limiting any of Tenant’s obligations hereunder, Tenant shall be responsible, as Additional Rent, for the costs of any alterations, additions or improvements in or to the Building that are required in order to comply with Legal Requirements as a result of any work performed by Tenant. Landlord shall have the right to provide rules and regulations relative to the performance of any alterations, additions, improvements and installations by Tenant hereunder, including, without limitation, payment for the costs of using Building services, provided such rules and regulations and charges are reasonable and are generally promulgated and applied to all tenants in Atlantic Wharf on a non-discriminatory basis, and Tenant shall abide by all such reasonable rules and regulations and shall cause all of its contractors to so abide. Tenant acknowledges and agrees that Landlord shall be the owner of any additions, alterations and improvements in the Premises or the Building to the extent paid for by Landlord.

 

9.4

Liens

Tenant covenants and agrees to pay promptly when due the entire cost of any work done on the Premises by Tenant, its agents, employees or contractors, and not to cause or permit any liens for labor or materials performed or furnished in connection therewith to attach to the Premises or the Building or Atlantic Wharf and immediately upon receipt of notice or actual knowledge to discharge any such liens which may so attach.

 

9.5	Nature of Alterations

All work, construction, repairs, alterations, other improvements or installations made to or upon the Premises (including, but not limited to, the construction performed by Landlord under Article IV), shall become part of the Premises and shall become the property of Landlord and remain upon and be surrendered with the Premises as a part thereof upon the expiration or earlier termination of the Lease Term, except as follows:

 

(a)

All trade fixtures whether by law deemed to be a part of the realty or not, installed at any time or times by Tenant or any person claiming under Tenant shall remain the property of Tenant or persons claiming under Tenant and may be removed by Tenant or any person claiming under Tenant at any time or times during the Lease Term or any occupancy by

 

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Tenant thereafter and shall be removed by Tenant at the expiration or earlier termination of the Lease Term if so requested by Landlord in writing at the time Landlord gives its approval for such installation. Tenant shall repair any damage to the Premises occasioned by the removal by Tenant or any person claiming under Tenant of any such property from the Premises, except to the extent that any such damage affects improvements to the Premises that will be demolished (in Landlord’s sole determination) by Landlord or the next tenant of such space.

 

(b)

(i) At the expiration or earlier termination of the Lease Term, Tenant shall remove: (i) any wiring, cables or other installations appurtenant thereto installed by Tenant, or anyone claiming by, through or under Tenant, for Tenant’s computer, telephone and other communication systems and equipment whether located in the Premises or in any other portion of the Building, including all risers between floors of the Premises (collectively, “Cable”), unless Landlord gives Tenant a written waiver of its obligation to remove Cable, and (ii) any alterations, additions and improvements made with Landlord’s consent during the Lease Term for which such removal was made a condition of such consent under Section 9.1(b), at its sole cost and expense. Without limiting the foregoing, Tenant (a) shall remove any internal stairways and all associated appurtenances installed by or on behalf of Tenant or anyone claiming by, through or under Tenant between floors of the Premises and Cable, equipment installed outside of the Premises (roof or mechanical floors), and fire alarm system “points and panel” within the Premises (collectively “Internal Stairways and Appurtenances” and “Cable”), and (b) shall restore the Premises including, but not limited to, in-filling the slab openings, re-installation of ceilings which have been removed to create “open ceilings” (collectively the “Restoration and Slab In Filling”). Upon such removal Tenant shall restore the Premises to their condition prior to such alterations, additions and improvements and repair any damage occasioned by such removal and restoration, except to the extent that any such damage affects improvements to the Premises that will be demolished (in Landlord’s sole determination) by Landlord or the next tenant of such space.

 

(c)

If Tenant shall make any alterations, additions or improvements to the Premises for which Landlord’s approval is required under Section 9.1 without obtaining such approval, then at Landlord’s request at any time during the Lease Term, and at any event at the expiration or earlier termination of the Lease Term, Tenant shall remove such alterations, additions and improvements and restore the Premises to their condition prior to same and repair any damage occasioned by such removal and restoration, except to the extent that any such damage affects improvements to the Premises that will be demolished (in the sole determination of Landlord) by Landlord or the next tenant of such space.

 

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Nothing herein shall be deemed to be a consent to Tenant to make any such alterations, additions or improvements, the provisions of Section 9.1 being applicable to any such work.

 

9.6	Increases in Taxes

Tenant shall pay, as Additional Rent, one hundred percent (100%) of any increase in real estate taxes on the Building which shall, at any time after the Commencement Date, result solely from alterations, additions or improvements to the Premises made by Tenant if the taxing authority specifically determines such increase results solely from such alterations, additions or improvements made by Tenant.

ARTICLE X

Parking

 

10.1	Parking Privileges

Subject to the next paragraph of this Section 10.1, Landlord shall provide to Tenant monthly parking privileges in the Atlantic Wharf Garage (the “Garage”) for, forty-one (41) passenger automobiles for the parking of motor vehicles in unreserved stalls in the Garage by Tenant’s employees commencing on the Commencement Date of the Term. In the event that the Rentable Floor Area of the Premises increases or decreases at any time during the Lease Term, the number of parking privileges provided to Tenant hereunder shall be increased or reduced proportionately, and based upon a ratio of one (1) parking space per 2,000 rentable square feet leased to Tenant. For the purposes of this Article X, the “Maximum Number of Parking Privileges” shall be defined as 41, as the same may be increased or reduced pursuant to the immediately preceding sentence.

Not later than one (1) year following the Commencement Date, time being of the essence (the “Outside Parking Notice Date”), Tenant shall give to Landlord an irrevocable notice (“Tenant’s Final Parking Notice”) of the total number of parking privileges (not to exceed 41) which Tenant elects to have and pay for, from and after the date of Landlord’s receipt of Tenant’s Final Parking Notice (provided same is received not later than the Outside Parking Notice Date) through and during the remainder of the Lease Term (as it may be extended). If Tenant shall fail to give or shall fail to timely give a Tenant’s Final Parking Notice, then in either such case, Tenant shall be deemed for all purposes to have irrevocably elected to have and pay for 41 parking privileges from and after the Outside Parking Notice Date through and during the remainder of the Lease Term (as it may be extended). Until the first to occur of (i) the Outside Parking Notice Date and (ii) the date of Landlord’s receipt of Tenant’s Final Parking Notice which must be received prior to the Outside Parking Notice Date, Tenant shall, not later than 10 days prior to the Commencement Date and not later than five (5) days prior to the first day of each calendar month, advise Landlord of the interim number of parking privileges Tenant elects to have and pay for, which in no event shall exceed the Maximum Number of Parking Privileges. If Tenant elects to lease fewer than the Maximum Number of Parking

 

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Privileges, Tenant shall have the right, from time to time, to request that Tenant be provided with an additional number of monthly parking privileges for use in the Garage in accordance with this Article X, which Landlord shall provide to Tenant, so long as: (i) such additional parking privileges are then available for use by Tenant, and (ii) the number of parking privileges provided to Tenant shall not exceed the Maximum Number of Parking Privileges.

 

10.2	Parking Charges

Tenant shall pay for such parking privileges at the prevailing monthly rates from time to time charged by the operator or operators of the Garage as quoted by Landlord to prospective office tenants of Atlantic Wharf (other than Wellington Management Company and as opposed to the monthly rates charged to the public or other persons who are not office tenants), whether or not such operator is an affiliate of Landlord. Such monthly parking charges for parking privileges shall constitute Additional Rent and shall be payable monthly as directed by Landlord upon billing therefor by Landlord or such operator. Tenant acknowledges that said monthly charges to be paid under this Section are for the use by the Tenant of the parking privileges referred to herein, and not for any other service.

 

10.3	Garage Operation

Unless otherwise determined by Landlord or the operator of such garage (the “Garage Operator”), the Garage is to be operated on (i) an attendant-managed basis, whereupon the Tenant shall be obligated to cooperate with such attendants in parking and removing its automobiles, or (ii) a self-park basis, whereupon Tenant shall be obligated to park and remove its own automobiles, and Tenant’s parking shall be on an unreserved basis, Tenant having the right to park in any available stalls excluding the parking nest or parking areas from time to time dedicated to Wellington Management or any other tenant or (iii) a combination of both. Tenant’s access and use privileges with respect to the Garage shall be in accordance with regulations of uniform applicability to the users of the Garage from time to time established by the Landlord or the Garage Operator. Tenant shall receive one (1) magnetic card or access card, or other suitable device providing access to the Garage, for each parking privilege paid for by Tenant. Tenant shall, from time to time within five (5) Business Days after receipt of a request from Landlord, supply Landlord with a then current identification roster listing, for each access card, the name of the employee and the make, color and registration number of the primary (or secondary if applicable) vehicles to which it has been assigned. The fact that an access card has been assigned to an employee of Tenant who has two vehicles shall not under any circumstances increase the number of parking privileges or allow both such vehicles to access the garage on the same day. The parking privileges granted herein are non-transferable (other than to an assignee or subtenant permitted to occupy and use the Premises pursuant to the applicable provisions of Article XII hereof). Landlord or the Garage Operator may institute a so-called valet parking program for the Garage, and in such event Tenant shall cooperate in all respects with such program. Landlord reserves for itself and any other owner the right to alter the Garage as it sees fit and in such case to

 

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change the Garage including the reduction in area of the same, provided that there shall be no reduction in the number of parking privileges available to Tenant. Landlord shall maintain and operate the Garage or cause the same to be maintained and operated in accordance with first-class standards and generally consistent with Class A office Buildings in the Central Business District in Boston that have a parking garage.

 

10.4	Limitations

Tenant agrees that it and all persons claiming by, through and under it, shall at all times abide by all reasonable rules and regulations promulgated by Landlord or the Garage Operator with respect to the use of the Garage. Except to the extent of negligence or willful acts, neither the Landlord nor the Garage Operator assumes any responsibility whatsoever for loss or damage due to fire or theft or otherwise to any automobile or to any personal property therein, however caused, and Tenant agrees, upon request from the Landlord, from time to time, to notify its officers, employees and agents then using any of the parking privileges provided for herein, of such limitation of liability. Tenant further acknowledges and agrees that a license only is hereby granted, and no bailment is intended or shall be created.

ARTICLE XI

Certain Tenant Covenants

Tenant covenants and agrees to the following during the Lease Term and for such further time as Tenant occupies any part of the Premises:

 

11.1

To pay when due all Annual Fixed Rent and Additional Rent and all charges for utility services rendered to the Premises and service inspections therefor except as otherwise provided in Exhibit C and, as further Additional Rent, all charges for additional and special services rendered pursuant to Section 7.3.

 

11.2

To use and occupy the Premises for the Permitted Use only, and not to injure or deface the Premises or the Building or Atlantic Wharf and not to permit in the Premises any auction sale, or flammable fluids or chemicals not used or stored in accordance with Legal Requirements, or nuisance, or the emission from the Premises of any objectionable noise or odor, nor to operate in the Premises anything which in any way results in the leakage of fluid or the growth of mold which is visible to the naked eye or hazardous to human health, and not to use or devote the Premises or any part thereof for any purpose other than the Permitted Use, nor any use thereof which is inconsistent with the maintenance of the Building as a Class A office building, or which is improper, offensive, contrary to law or ordinance or liable to invalidate or increase the premiums for any insurance on the Building or its contents or liable to render necessary any alteration or addition to the Building. Landlord acknowledges and agrees that the use (as opposed to the manner of use) of the Premises for general business office use will not invalidate Landlord’s insurance or increase the premiums therefore. Further, (i) Tenant

 

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shall not, nor shall Tenant permit its employees, invitees, agents, independent contractors, contractors, assignees or subtenants to, keep, maintain, store or dispose of (into the sewage or waste disposal system or otherwise) or engage in any activity which might produce or generate any substance which now or hereinafter is classified as a hazardous material, waste or substance (collectively “Hazardous Materials”), under federal, state or local laws, rules and regulations, including, without limitation, 42 U.S.C. Section 6901 et seq., 42 U.S.C. Section 9601 et seq., 42 U.S.C. Section 2601 et seq., 49 U.S.C. Section 1802 et seq. and Massachusetts General Laws, Chapter 21E and the rules and regulations promulgated under any of the foregoing, as such laws, rules and regulations may be amended from time to time (collectively “Hazardous Materials Laws”), (ii) Tenant shall promptly notify Landlord of any incident in, on the Premises, the Building or Atlantic Wharf that would require the filing of a notice under any Hazardous Materials Laws, (iii) Tenant shall comply and shall cause its employees, invitees, agents, independent contractors, contractors, assignees and subtenants to comply with each of the foregoing and (iv) Landlord shall have the right to make such inspections (including testing) as Landlord shall elect from time to time to determine that Tenant is complying with the foregoing. Notwithstanding the foregoing, Tenant may use Hazardous Materials and other substances typically used in typical business offices in class A office buildings in the Central Business District of Boston by Tenant for the conduct of the Permitted Uses, provided that Tenant uses, stores and disposes of such Hazardous Materials and other substances in the manner which they are normally used, and in compliance with all Hazardous Materials Laws and other applicable laws, ordinances, bylaws, rules and regulations, and Tenant obtains and complies with all permits required by Hazardous Materials Laws or any other laws, ordinances, bylaws, rules or regulations prior to the use or presence of any such substances in the Premises.

Landlord represents to Tenant that, to the best of Landlord’s knowledge, as hereinafter defined, there exist no Hazardous Materials in the Building or elsewhere at Atlantic Wharf which do not comply with applicable Hazardous Materials Laws and which require abatement or remediation. For the purposes of this paragraph, “Landlord’s knowledge” shall mean the knowledge of Jeffrey J. Lowenberg, Vice President of Development (Landlord hereby representing that Jeffrey J. Lowenberg has had extensive involvement in the development of Atlantic Wharf). Landlord agrees that the removal or remediation of any Hazardous Materials that become present at the Building or in, under, or upon Atlantic Wharf during the Term, other than Hazardous Materials introduced by Tenant (or anyone claiming by, through, or under Tenant), shall be at no cost to Tenant, except as otherwise expressly set forth in Section 7.4. If any Hazardous Materials which are in violation of applicable Environmental Laws become present at the Building or in, under or upon Atlantic Wharf during the Term, other than Hazardous Materials introduced by Tenant (or anyone claiming by, through, or under Tenant), Landlord shall (subject to Landlord’s right, at its sole discretion, to appeal any administrative orders or legal judgments related to the determination of its liability for Hazardous Materials) cause such Hazardous Materials to be removed or remediated when, if, and in the manner required by applicable Hazardous Materials Laws, at no cost to Tenant, except as otherwise expressly set forth in Section 7.4.

 

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11.3

Not to obstruct in any manner any portion of the Building not hereby leased to Tenant or any areas of Atlantic Wharf used by Tenant in common with others; not without prior consent of Landlord to permit the painting or placing of any signs, curtains, blinds, shades, awnings, aerials or flagpoles, or the like, visible from outside the Premises; provided however, that the foregoing shall not affect Tenant’s right to use building standard window blinds or to install and maintain any signage permitted under this Lease; and to comply with all reasonable rules and regulations for the Building now or hereafter made by Landlord, of which Tenant has been given notice, for the care and use of the Building and Atlantic Wharf and their facilities and approaches, but Landlord shall not be liable to Tenant for the failure of other occupants of the Building to conform to such rules and regulations. Landlord agrees that Tenant shall have the following signage rights during the Lease Term:

 

(a)

If, and so long as Brightcove Inc. itself, together with Permitted Transferees, occupy at least 120,000 rentable square feet of office space in the Building (“Plaque Condition”), Tenant shall have the right to install and maintain a tenant identification plaque (“Plaque”) at the street level on the Waterfront Office Building in the location shown on Exhibit N . Such plaque shall be subject to: (i) Landlord’s prior written consent, which consent shall not be unreasonably withheld, conditioned, or delayed, and (ii) Tenant obtaining all necessary governmental approvals in connection with such plaque. Tenant shall, at Tenant’s cost, maintain the plaque in good condition. Upon the earlier of: (x) the termination or expiration of the Lease Term, or (y) Tenant’s inability to satisfy the Plaque Condition, Tenant shall, at Tenant’s sole cost and expense, remove the plaque and repair any damage to the Waterfront Office Building caused by the installation or removal of the Plaque.

 

(b)

Landlord shall list Tenant’s name on an electronic directory in the lobby of the Waterfront Office Building (“ Lobby ”). Notwithstanding the foregoing, Landlord acknowledges that, in lieu of such electronic directory, Tenant desires to install an impact electronic tenant identification display (“ Impact Display ”) in the Lobby. Tenant acknowledges that Landlord is unwilling to allow Tenant to install an Impact Display in the Lobby unless the other tenants in the Waterfront Office Building, Payette Associates and Communispace (“ Other Tenants ”), agree to install an Impact Display. Landlord agrees that it will attempt to arrange meetings between Tenant, Landlord and representatives of the Other Tenants to discuss the installation of an Impact Display. If Tenant and Other Tenants agree that they desire to install and maintain an Impact Display in the Lobby as well as the terms for (“ Impact Display Terms ”) operating and sharing the cost (installation, operational, and removal) of such Impact Display, then Landlord will allow the installation and maintenance of such Impact Display, subject to Landlord’s prior written approval of the location of the Impact Display, the Impact Display (as well as the materials to be shown on the Impact Display), and the Impact Display Terms, which approval shall not be unreasonably withheld, conditioned, or delayed.

 

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(c)

Tenant shall have the right to install and maintain Building standard tenant identification signs on Tenant’s entry doors and in the elevator lobbies on which floor of the Building on which the Premises are located.

 

11.4

To keep the Premises equipped with all safety appliances required by law or ordinance or any other regulation of any public authority because of any use made by Tenant other than normal office use, and to procure all licenses and permits so required because of any use made by Tenant other than normal office use, and, if requested by Landlord, to do any work so required by Legal Requirements because of: (i) any use by Tenant other than general office use, or (ii) alterations, additions, or improvements made by Tenant (provided, however, that Tenant shall not be required to perform work in the common areas required by Legal Requirements as the result of alterations, additions, or improvements made by Tenant within the Premises), it being understood that the foregoing provisions shall not be construed to broaden in any way Tenant’s Permitted Use.

 

11.5

Not to place a load upon any floor in the Premises exceeding an average rate of 70 pounds of live load (including partitions) per square foot of floor area; and not to move any safe, vault or other heavy equipment in, about or out of the Premises except in such manner and at such time as Landlord shall in each instance authorize. Tenant’s business machines and mechanical equipment shall be placed and maintained by Tenant at Tenant’s expense in settings sufficient to absorb and prevent vibration or noise that may be transmitted to the Building structure or to any other space in the Building.

 

11.6	To pay promptly when due all taxes which may be imposed upon personal property (including, without limitation, fixtures and equipment) in the Premises to whomever assessed.

 

11.7	To pay, as Additional Rent, all reasonable costs, counsel and other fees incurred by Landlord in connection with the successful enforcement by Landlord of any obligations of Tenant under this Lease or in connection with any bankruptcy case involving Tenant.

 

11.8

To comply with all applicable Legal Requirements now or hereafter in force which shall impose a duty on Landlord or Tenant relating to or as a result of the use or occupancy of the Premises, except that (i) Landlord shall be responsible for maintaining or causing to be maintained the compliance of all of the common areas and public areas of the Building, the Garage and Atlantic Wharf with all City, State and Federal requirements concerning accessibility, including, without limitation, the requirements and regulations of the Massachusetts Architectural Access Board and all requirements of the Americans With Disabilities Act; and (ii) Tenant shall not be required to make any alterations or additions required by Legal Requirements (including any Legal Requirements requiring installation of new building service equipment, such as fire detection or suppression equipment) to made to the structure, roof, exterior and load bearing walls, foundation,

 

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structural floor slabs and other structural and weatherization elements of the Building or any common utility or building service equipment wherever located, unless such alterations or additions are required by reason of: (x) Tenant’s use of the Premises for other than general office use, or (y) alterations, additions, or improvements made by Tenant (provided, however, that in no event will Tenant be required to perform work in the common areas required by Legal Requirements as the result of alterations, additions, or improvements made by Tenant within the Premises). Tenant shall promptly pay all fines, penalties and damages that may arise out of or be imposed because of its failure to comply with the provisions of this Section 11.8.

 

11.9	In order to reduce peak-hour trip generation of employees at Atlantic Wharf, the Landlord encourages (but without any obligation under this Lease) all employers at Atlantic Wharf to adopt flexible work schedules for its employees. The Landlord encourages all employers at Atlantic Wharf to:

 

•

Save on payroll-related taxes and provide employee benefits by offering transportation benefits.

 

•

Provide on-site and on-line sale of MBTA passes for employees.

 

•

Encourage tenants to provide a 50% subsidy for all full-time employees. Striving for a transit subsidy of 50% is a consistent citywide goal as part of TDM and mitigation programs.

 

•

Provide information on bus and subway routes and schedules to its employees.

 

•

Facilitate ridesharing through geographic matching, parking fee discounts, and preferential parking for carpools/vanpools. This may be accomplished through membership in a TMA, use of computerized ridesharing software, or participation in MassRIDES, the Massachusetts Car Sharing program.

 

•

Organize an internal ride-matching program for employees who would be more willing to participate in a ride-matching service with fellow employees than with a large regional database.

 

•

Provide preferential parking for car- or vanpool participants. Spaces will be determined on a demand basis.

 

11.10

Any vendors engaged by Tenant to perform services in or to the Premises including, without limitation, janitorial contractors and moving contractors shall be coordinated with any work being performed by or for Landlord and in such manner as to maintain harmonious labor relations and not to damage the Building or Atlantic Wharf or interfere with Building construction or operation and shall be performed by vendors first reasonably approved by Landlord.

 

11.11

As an inducement to Landlord to enter into this Lease, Tenant hereby represents and warrants that: (i) Tenant is not, nor is it owned or controlled directly or indirectly by, any person, group, entity or nation named on any list issued by the Office of Foreign Assets Control of the United States Department of the Treasury (“OFAC”) pursuant to Executive Order 13224 or any similar list or any law, order, rule or regulation or any Executive Order of the President of the United States as a terrorist, “Specially Designated National

 

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and Blocked Person” or other banned or blocked person (any such person, group, entity or nation being hereinafter referred to as a “Prohibited Person”); (ii) Tenant is not (nor is it owned, controlled, directly or indirectly, by any person, group, entity or nation which is) acting directly or indirectly for or on behalf of any Prohibited Person; and (iii) from and after the effective date of the above-referenced Executive Order, Tenant (and any person, group, or entity which Tenant controls, directly or indirectly) has not conducted nor will conduct business nor has engaged nor will engage in any transaction or dealing with any Prohibited Person in violation of the U.S. Patriot Act or any OFAC rule or regulation, including without limitation any assignment of this Lease or any subletting of all or any portion of the Premises or the making or receiving of any contribution of funds, goods or services to or for the benefit of a Prohibited Person in violation of the U.S. Patriot Act or any OFAC rule or regulation. In connection with the foregoing, it is expressly understood and agreed that (x) any breach by Tenant of the foregoing representations and warranties of which Tenant does not have actual knowledge which is not corrected forthwith upon receipt of notice or actual knowledge shall be deemed an Event of Default by Tenant under Section 15.1(d) of this Lease and shall be covered by the indemnity provisions of Section 13.1 below, and (y) the representations and warranties contained in this subsection shall be continuing in nature and shall survive the expiration or earlier termination of this Lease.

ARTICLE XII

Assignment and Subletting

 

12.1	Restrictions on Transfer

Except as otherwise expressly provided herein, Tenant covenants and agrees that it shall not assign, mortgage, pledge, hypothecate or otherwise transfer this Lease and/or Tenant’s interest in this Lease or sublet (which term, without limitation, shall include granting of concessions, licenses or the like) the whole or any part of the Premises. Any assignment, mortgage, pledge, hypothecation, transfer or subletting not expressly permitted in this Lease or consented to by Landlord under this Article XII shall, at Landlord’s election, be void; shall be of no force and effect; and shall confer no rights on or in favor of third parties. In addition, Landlord shall be entitled to seek specific performance of or other equitable relief with respect to the provisions hereof.

 

12.2	Tenant’s Notice

Notwithstanding the provisions of Section 12.1 above, in the event Tenant desires to assign this Lease or to sublet the whole or any part of the Premises, Tenant shall give Landlord notice (the “Proposed Transfer Notice”) of any proposed sublease or assignment, and said notice shall specify the provisions of the proposed assignment or subletting, including (a) the name and address of the proposed assignee or subtenant, (b) in the case of a proposed assignment or subletting pursuant to Section 12.4 below, such information as to the proposed assignee’s or proposed subtenant’s net worth and financial capability and standing as may reasonably be required for Landlord to make the

 

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determination referred to in said Section 12.4 (provided, however, that Landlord shall hold such information confidential having the right to release same only to its officers, accountants, attorneys and mortgage lenders on a confidential basis), (c) all of the terms and provisions upon which the proposed assignment or subletting is to be made, (d) in the case of a proposed assignment or subletting pursuant to Section 12.4 below, all other information necessary to make the determination referred to in said Section 12.4 and (e) in the case of a proposed assignment or subletting pursuant to Section 12.5 below, such information as may be reasonably required by Landlord to determine that such proposed assignment or subletting complies with the requirements of said Section 12.5. Tenant may, prior to identifying a proposed assignee or subtenant, give Landlord written notice (“Notice of Intent to Transfer”) advising Landlord that Tenant intends to enter into an assignment of Tenant’s interest in the Lease or a proposed sublease of the Premises, or any portion thereof. A Notice of Intent to Transfer shall set forth: (f) the location and size of the portion of the Premises which would be affected by such proposed assignment or sublease, (g) the estimated commencement of the term of such proposed assignment or sublease, and (h) the estimated term of such proposed assignment or sublease.

 

12.3	Landlord’s Termination Right

Except in connection with a proposed assignment or sublease to a Permitted Transferee in accordance with Section 12.5 below, in the event Tenant proposes to assign this Lease or enter into any sublease, Landlord shall have the right at its sole option, to be exercised within fifteen (15) days after receipt of Tenant’s Proposed Transfer Notice or Notice of Intent to Transfer, as the case may be (the “Acceptance Period”), to terminate this Lease in the case of a proposed assignment or sublease of all or substantially all of the Premises for all or substantially all of the remaining Term, or (b) in the case of an proposed subletting of less than all or substantially all of the Premises, to (y) terminate this Lease only as to the portion of the Premises then proposed to be sublet if such sublease shall be for all or sub