Exhibit 10.13
EDGEWATER OFFICE PARK
WAKEFIELD, MASSACHUSETTS
SECOND AMENDMENT TO LEASE
Epsilon Data Management, LLC
Second Amendment to Lease
(“Second Amendment”) dated as of October 3, 2008
between 601 Edgewater LLC, a Delaware limited liability company
(“Landlord”), and Epsilon Data Management, LLC, a
Delaware limited liability company, successor by merger to Epsilon
Data Management, Inc., a Delaware corporation
(“Tenant”).
Background
Reference is made to that certain
Office Lease between Landlord and Tenant, dated July 30, 2002 (the
“Original Lease”), as amended by that certain First
Amendment to Lease between Landlord and Tenant, dated
August 29, 2007 (the “First Amendment” and
together with the Original Lease, the “Lease”) for
certain premises containing 113,433 square feet of Rentable Floor
Area (the “Premises”) in the building known as 601
Edgewater Drive, Wakefield, MA (the “Building”).
Capitalized terms used and not otherwise defined in this Second
Amendment shall have the meanings ascribed to them in the
Lease.
Landlord and Tenant desire to enter
into this Second Amendment to extend the Term of the Lease and to
make certain other changes, all on the terms more particularly set
forth in this Second Amendment.
Agreement
FOR VALUE RECEIVED, Landlord and
Tenant agree as follows:
1. Term Extension. The Term of the
Lease is hereby extended for an additional twelve (12) year
term commencing on January 1, 2009 (the “Extension
Commencement Date”) and expiring on the last day of the
twelfth (12th) Extended Lease Year, which shall be the new
Term Expiration Date (the “Extended Term”). Each
“Extended Lease Year” shall consist of twelve
(12) calendar months beginning with the Extension Commencement
Date. All references to Lease Year in the Lease shall be amended to
include Extended Lease Year, mutatis mutandis.
2. Improvements. (a) Tenant
Work: Landlord shall reimburse Tenant for actual third-party costs
incurred by Tenant to make improvements to the Premises in the
amount of $1,134,330 (the “Extension Tenant Improvement
Allowance”). Any portion of the Extension Tenant Improvement
Allowance may be credited against the next payments due of Annual
Fixed Rent by notice to such effect given by Tenant to Landlord.
Any portion of the Extension Tenant Improvement Allowance not so
credited shall be made available to Tenant within ninety
(90) days after the date hereof. In addition, Landlord shall
reimburse Tenant for actual third-party costs incurred for
Tenant’s space planning for the Premises in the amount of
$11,343.30 (the “Extension Space Planning Allowance”).
The Extension Space Planning Allowance shall be distributed within
five (5) Business Days after the date hereof. All
Tenant’s construction costs for
the Premises in excess of the Extension Tenant
Improvement Allowance and all design costs for the Premises in
excess of the Extension Space Planning Allowance shall be paid for
entirely by Tenant, and Landlord shall not provide any
reimbursement therefor.
(b) Landlord Work. Landlord shall
perform, at Landlord’s sole cost and expense, subject to an
allowance in the amount of $2,268,660.00 (the “Base Building
Allowance”), the base building work described on Exhibit C
attached hereto (the “Base Building Work”). The Base
Building work is in the nature of Landlord’s capital and
depreciable improvements to the Building and shall commence upon
the date hereof. Landlord shall use best efforts to substantially
complete the Base Building Work on Of before February 1, 2009,
subject to Tenant’s Delays (as defined below) and Force
Majeure. All Base Building Work (including, without limitation, any
Change Orders (as defined on Exhibit B attached hereto) the cost of
which exceeds the Base Building Allowance shall be “Excess
Work.” All Excess Work shall be performed at the sale expense
of Tenant. Tenant shall pay Landlord for such Excess Work within
ten (10) days following receipt of Landlord’s invoice
therefor. Tenant acknowledges and agrees that (a) Landlord may
be performing the Base Building Work during the first month of the
Extended Term, and Tenant shall use reasonable efforts to cooperate
with Landlord with respect to such work including, without
limitation, providing Landlord with reasonable access to the
Premises, if necessary, during performance of the Base Building
Work, and (b) the Base Building Work is being performed for
Landlord’s purposes only and all Base Building Work shall be
the property of Landlord and shall be retained by Landlord at the
expiration or earlier termination of the Extended Term.
No charges shall be imposed by
Landlord for Tenant’s use of utilities, loading docks, and
passenger and freight elevators during construction of Tenant
improvements. Landlord agrees not to impede, hinder or interfere
with the construction of Tenant improvements. Landlord agrees that
deliveries may be received, without preference or priority given to
Landlord’s deliveries, at any time of the day, subject to
scheduling with the Landlord. Landlord shall pad the
elevators.
For purposes of this Second
Amendment, “Tenant’s Delays” shall include:
(i) any request by Tenant that Landlord delay in the
commencement or completion of the Base Building Work, (ii) any
change made or requested by Tenant in any of the Base Building Work
Plans (as defined on Exhibit B attached hereto), (iii) any
special requirements of Tenant not in conformity with the Base
Building Work Plans, (iv) the failure of Tenant to submit the
Base Building Work Plans to Landlord for approval on or before
October 15, 2008 (the “Base Building Work Plans
Submission Deadline”), (v) any other act or Omission of
Tenant or its members, managers, officers, directors, agents,
servants, contractors, architects, engineers or employees, or
(vi) any reasonably necessary rescheduling of the sequence of
any of the Base Building Work due to any of the causes for delay
referred to in the preceding clauses (i) - (v).
3. Base Operating Expenses and
Taxes. Commencing as of the Extension Commencement Date,
(i) the Base Operating Expenses Per Square Foot of Rentable
Floor Area figure shall be equal to actual Operating Expenses for
calendar year 2009, adjusted to 100% occupancy and (ii) the
Base Taxes Per Square Foot of Rentable Floor Area figure shall be
equal to actual Taxes for fiscal year 2009.
4. Annual Fixed Rent. Effective as
of the Extension Commencement Date, the definitions of
“Annual fixed Rent” in Section 1.1 of the Original
Lease and Section 3 of the First Amendment shall be deleted in
their entirety and replaced with the following:
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Rent Per
Rentable
Square
Foot
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Annual Fixed
Rent
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Monthly Rent
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1-3
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$
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24.25
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$
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2,750,750.25
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$
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229,229.19
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4-5
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$
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25.25
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$
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2,864,183.25
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$
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238,681.94
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6-10
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$
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28.25
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$
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3,204,482.25
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$
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267,040.19
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11-12
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$
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31.25
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$
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3,544,781.25
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$
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295,398.44
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Annual Fixed Rent shall be due and
payable in equal monthly installments as provided in
Section 2.5 of the Lease.
5. Extension Options.
Section 2.4.1 of the Lease is hereby deleted in its entirety
and replaced with the following:
Tenant shall have the option to
extend the Term for two (2) additional 5 year extension terms
(each an “Extension Term”) by notice given to Landlord
at least one (1) year before the Term Expiration Date.
Tenant’s election shall be exercised, and Annual Fixed Rent
for the Extension Term determined, as set forth below. If Tenant
fails timely to exercise its option for any Extension Term, Tenant
shall have no further extension rights hereunder.
Tenant’s option so to extend
the Term shall be void, at Landlord’s election, if Tenant is
in default at the time Tenant elects to extend the Term or at the
time the Term would expire but for such extension or if more than
seventy percent (70%) of the Premises are to be used as a data
center during such Extension Term. Tenant shall have no right to
extend the Term for less than seventy percent (70%) of the
Premises. During the Extension Term, if any, all provisions of this
Lease shall apply except that Tenant shall have no further option
to extend the Term after the last Extension Tenn.
During the Extension Term, Tenant
shall pay Annual Fixed Rent equal to the greater of (i) the
Annual Fixed Rent then being paid under the Lease or
(ii) ninety five percent (95%) of the then prevailing
market rate for a five (5) year lease of office space in the
Greater Boston, Massachusetts “Metro-North” area
comparable to the Premises in terms of location within a building,
finish, age, building quality and amenities for a tenant of equal
size and financial strength as Tenant, under terms and conditions
substantially the. same as those of this Lease as though then
available for single occupancy for the Permitted Uses (or any
higher and better use then being made by Tenant) in
“as-is” condition or such better condition in which
Tenant is required to maintain the Premises taking into account
rent abatements, construction costs and other concessions and the
manner, if any, in which Landlord is reimbursed for operating
expenses and taxes (the “Fair Market Rent”).
Landlord shall notify Tenant of its
estimate of the Fair Market Rent within ten (10) days after
Tenant exercises the applicable extension option. Tenant shall have
the option to accept or
reject by written notice Landlord’s
estimate, or to withdraw its exercise of the extension option, in
any case within fourteen (14) days following delivery of
Landlord’s estimate. Tenant’s failure to respond within
such period shall be deemed to constitute acceptance of
Landlord’s estimate. In the event Tenant rejects
Landlord’s estimate then the Fair Market Rent shall be
arbitrated in accordance with the following procedure.
Each of Landlord and Tenant, within
twenty (20) days after notice by Tenant disputing
Landlord’s estimate of the Fair Market Rate, shall appoint as
an arbitrator an MAI appraiser with at least ten (10) years
experience as an appraiser of office buildings in the Greater
Boston area, including first class suburban office buildings, and
shall give notice of such appointment to the other party. If either
Landlord or Tenant shall fail timely to appoint an arbitrator, the
other may apply to the Boston office of the American Arbitration
Association (“AAA “) for appointment of such an
arbitrator five (5) Business Days, as such term is defined in
Section 8.19, after notice of such failure to the delinquent
party if such arbitrator has not then been appointed. The two
arbitrators shall, within five (5) Business Days after
appointment of the second arbitrator, appoint a third arbitrator
who shall be similarly qualified. If the two arbitrators are unable
to agree timely on the selection of the third arbitrator, then
either arbitrator on behalf of both may request such appointment
from the Boston office of the AAA. The arbitration shall be
conducted in accordance with the commercial arbitration rules of
the AAA insofar as such rules are not inconsistent with the
provisions of this Lease (in which case the provisions of this
Lease shall govern). The arbitrators shall be charged to reach a
majority written decision in accordance with the standards for the
Fair Market Rate as provided in this Section 2.4.1, within
twenty (20) days after the third arbitrator is appointed, by
selecting either of the final estimates of the Fair Market Rate
provided by Landlord and Tenant at the commencement of the hearing.
The arbitrators shall have no authority or jurisdiction to make any
other determination of such amount. The cost of the arbitration
(exclusive of each party’s witness and attorneys fees, which
shall be paid by such party) shall be borne equally by the parties.
If the AAA shall cease to provide arbitration for commercial
disputes in Boston, the second or third arbitrator, as the case may
be, shall be appointed by any successor organization providing
substantially the same services, and in the absence of such an
organization, by a court of competent jurisdiction under the
arbitration act of The Commonwealth of Massachusetts.
If Landlord should delay in giving
the notice which begins the valuation procedures of this
Section 2.4.1, or if the process should otherwise be delayed
for any reason, then such procedures shall nevertheless remain in
effect and be applicable when and as invoked with respect to Annual
Fixed Rent payable during the Extension Term; but until such
procedures are completed, Tenant shall pay on account of Annual
Fixed Rent at the rate established for Annual Fixed Rent for the
last twelve (12) months of the Term (and upon Fair Market Rent
being established, Tenant shall pay the same within ten
(10) days of such determination, retroactively to the
beginning of the Extension Term). Each party shall bear the costs
of the arbitrator selected by it and shall share equally in the
costs of the third arbitrator selected in accordance herewith. The
parties shall adjust for over or under payments within twenty
(20) days after the decision of the arbitrators is
announced.
Promptly after the Annual Fixed Rent
is determined for each Extension Term, Landlord and Tenant shall
enter into an amendment of this Lease confirming the extension of
the Term and the new rate for Annual Fixed Rent.
6. Expansion. (a) Right of
First Offer. Simultaneously with any offer to lease any portion of
the Building or any portion of the b