EXHIBIT 10.1
------------
LEASE
between
DMP NEW BRANFORD, LLC, as Landlord
and
CAS MEDICAL SYSTEMS, INC, as Tenant
44 East Industrial Road
Branford, Connecticut
September 6, 2007
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TABLE OF CONTENTS
-----------------
ARTICLE 1
GRANT..............................................................1
ARTICLE 2
TERM...............................................................2
ARTICLE 3
DELIVERY OF OCCUPANCY OF THE
PREMISES..............................2
ARTICLE 4 RENT
AND SECURITY..................................................5
ARTICLE 5
ADDITIONAL RENT FOR PROJECT
EXPENSES...............................9
ARTICLE 6
SERVICES AND
UTILITIES............................................15
ARTICLE 7
CONDUCT OF BUSINESS BY
TENANT.....................................17
ARTICLE 8 REPAIR
AND MAINTENANCE; ALTERATIONS AND IMPROVEMENTS..............24
ARTICLE 9
INSURANCE.........................................................28
ARTICLE 10
CASUALTY..........................................................31
ARTICLE 11
CONDEMNATION......................................................33
ARTICLE 12 ASSIGNMENT
AND SUBLETTING.........................................34
ARTICLE 13 DEFAULTS
AND REMEDIES.............................................37
ARTICLE 14
NONDISTURBANCE AND RIGHTS OF MORTGAGE
HOLDERS.....................43
ARTICLE 15
NOTICES...........................................................45
ARTICLE 16
MISCELLANEOUS.....................................................46
ARTICLE 17 EXTENSION
RIGHT...................................................49
ARTICLE 18 RIGHT OF
FIRST OFFER..............................................51
ARTICLE 19 RIGHT TO
EXPAND...................................................52
ARTICLE 20 LANDLORD
LIEN WAIVER..............................................62
LIST OF EXHIBITS
----------------
Exhibit A
Premises
Exhibit B
Legal Description
Exhibit C-1 Building
Rules and Regulations
Exhibit C-2
Tenant/Contractor Rules and Regulations
Exhibit D
Form of Letter of Credit
Exhibit E
Building Addition Location
Exhibit F
Sample Development Budget
Exhibit G
Base Building Description
Exhibit H
Base Building and Tenant Rooftop HVAC Units
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LEASE
-----
This
Lease is made and entered into as of September 6, 2007, by and
between
DMP NEW BRANFORD, LLC, a Massachusetts limited liability company,
with its
principal place of business at c/o Davis Marcus Partners, Inc., One
Appleton
Street, Boston, Massachusetts 02116 (the "LANDLORD") and CAS
MEDICAL SYSTEMS,
INC., a Delaware corporation with its principal place of business
at 44 East
Industrial Road, Branford, Connecticut 06405 (the "TENANT").
Recitals
--------
A.
This Lease is being executed and delivered by the parties pursuant
to
the terms of that certain Purchase and Sale Agreement between
Tenant, as seller,
and Landlord, as buyer, (as defined in Section 1.1) pursuant to
which Landlord
has agreed to purchase the "Property" (defined in Section 1.1) from
Tenant.
B.
Tenant has been the sole occupant of the Property since it acquired
the
"Land" (as defined in Section 1.1) and constructed the "Building"
(as defined in
Section 1.1) in 1998.
ARTICLE 1 GRANT
1.1
Premises. LANDLORD, FOR AND IN CONSIDERATION OF THE RENTS
HEREIN
RESERVED AND OF THE COVENANTS AND AGREEMENTS HEREIN CONTAINED ON
THE PART OF
TENANT TO BE PERFORMED, HEREBY LEASES TO TENANT AND TENANT ACCEPTS
FROM
LANDLORD, CERTAIN SPACE SHOWN ON EXHIBIT A ATTACHED HERETO AND MADE
A PART
HEREOF, CONTAINING 24,000 RENTABLE SQUARE FEET IN AREA (THE
"Premises"),
SITUATED IN AN OFFICE/INDUSTRIAL BUILDING LOCATED AT 44 EAST
INDUSTRIAL ROAD,
BRANFORD, CONNECTICUT (THE "Building"). THE PREMISES, BUILDING, THE
"Common
Areas" (DEFINED BELOW) AND THE LAND UPON WHICH THE SAME ARE
LOCATED, WHICH IS
LEGALLY DESCRIBED IN EXHIBIT B (THE "Land"), TOGETHER WITH ALL
OTHER
IMPROVEMENTS THEREON AND THEREUNDER ARE COLLECTIVELY REFERRED TO AS
THE
"Property".
1.2
Common Areas. LANDLORD HEREBY GRANTS TO TENANT DURING THE TERM OF
THIS
LEASE, A LICENSE TO USE, IN COMMON WITH THE OTHERS ENTITLED TO SUCH
USE, THE
COMMON AREAS AS THEY FROM TIME TO TIME EXIST, SUBJECT TO THE
RIGHTS, POWERS AND
PRIVILEGES HEREIN RESERVED TO LANDLORD. THE TERM "Common Areas" AS
USED HEREIN
WILL INCLUDE ALL AREAS AND FACILITIES OUTSIDE THE BUILDING LOCATED
ON THE
PROPERTY THAT ARE PROVIDED AND DESIGNATED BY LANDLORD FOR GENERAL
NON-EXCLUSIVE
USE AND CONVENIENCE OF TENANT AND OTHER TENANTS OF THE PROPERTY.
COMMON AREAS
SHALL INCLUDE, DURING THE TERM OF THE LEASE, AS EXTENDED, BUT ARE
NOT LIMITED TO
THE PEDESTRIAN SIDEWALKS, LANDSCAPED AREAS, ROADWAYS, PARKING AREAS
AND RIGHTS
OF WAY. TENANT WILL HAVE THE EXCLUSIVE USE OF THE COMMON AREAS
(SUBJECT TO
LANDLORD'S RIGHTS UNDER THIS LEASE) DURING THE PERIOD THAT TENANT
IS THE SOLE
TENANT OF THE PROPERTY.
1.3
Parking. TENANT SHALL HAVE THE RIGHT TO USE: (A) THE PARKING
SPACES
LOCATED BETWEEN THE BUILDING AND THE ADJOINING PUBLIC STREET ON AN
EXCLUSIVE
BASIS (THE "Exclusive Parking Area"), AND (B) THE OTHER PARKING
FACILITIES AT
THE PROPERTY IN COMMON WITH OTHER PROPERTY TENANTS ON A
NON-EXCLUSIVE BASIS. THE
TOTAL NUMBER OF PARKING SPACES AT THE PROPERTY AVAILABLE TO TENANT
(INCLUSIVE OF
BOTH EXCLUSIVE AND NON-EXCLUSIVE SPACES) SHALL BE BASED UPON THE
MINIMUM NUMBER
OF PARKING SPACED REQUIRED TO HAVE BEEN PROVIDED FOR THE BUILDING
UNDER THE
BRANFORD ZONING REGULATIONS AT THE TIME OF THE TOWN OF BRANFORD'S
APPROVAL OF
THE SITE PLANS FOR THE DEVELOPMENT OF THE BUILDING. TENANT AGREES
NOT TO
OVERBURDEN THE PARKING FACILITIES AND AGREES TO COOPERATE WITH
LANDLORD AND
OTHER TENANTS IN THE USE OF PARKING FACILITIES. LANDLORD MAY
DESIGNATE PARKING
FACILITIES AT THE PROPERTY FOR THE HANDICAPPED, VISITORS TO THE
BUILDING AND FOR
OTHER TENANTS OF THE PROPERTY.
1.4
FUTURE CONSTRUCTION BY LANDLORD. Landlord agrees that it shall
not
construct any additions to the existing Building nor any
additional
free-standing building prior to the third
1
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(3rd) anniversary of the Commencement Date. Following the third
(3rd)
anniversary of the Commencement Date, there shall be no
restrictions on
Landlord's right to construct any free-standing buildings at the
Property.
Landlord acknowledges that any proposed addition for the existing
Building shall
require Tenant's prior written consent, which shall not be
unreasonably
withheld. Landlord agrees to provide written notice (the "NOTICE OF
INTENT TO
BUILD") to Tenant following its decision to undertake any such new
construction
together with such information as may then be available concerning
the size and
design of the new improvements, but Landlord may not deliver a
Notice of Intent
to Build prior to the third (3rd) anniversary of the Commencement
Date
(notwithstanding the fact that Landlord may have made such decision
prior to
such date and have undertaken related planning and related
non-construction
activities). If Tenant delivers its "Building Expansion Notice" (as
defined in
Section 19.2.1 prior to the Landlord's delivery of its Notice of
Intent to
Build, then Tenant's Building Expansion Notice shall have
priority
notwithstanding the fact that Landlord may have undertaken planning
or related
non-construction activities prior to its delivery of its Notice of
Intent to
Build.
ARTICLE 2 TERM
2.1
Lease Term.
2.1.1 COMMITMENT DATE; TERM. THE PREMISES ARE LEASED FOR A TERM
(THE
"Initial Term") TO COMMENCE ON SEPTEMBER ____, 2007 THE
"Commencement Date"
AND
SHALL END ON THE DATE (THE "Expiration Date") THAT IS TEN (10)
"Lease
Years" (AS DEFINED BELOW) AFTER THE COMMENCEMENT DATE UNLESS
SOONER
TERMINATED AS HEREIN PROVIDED. IF TENANT EXERCISES ITS OPTION TO
EXTEND THE
TERM
PURSUANT TO SECTION 17.1, THE EXPIRATION DATE SHALL BE EXTENDED
IN
ACCORDANCE WITH ARTICLE 17 HEREOF (THE INITIAL TERM HEREOF, AND AS
SO
EXTENDED, THE "Term").
2.1.2 LEASE YEAR DEFINED. THE FIRST "Lease Year" SHALL BEGIN ON
THE
COMMENCEMENT DATE AND SHALL END ON THE LAST DAY OF THE TWELFTH
(12TH) FULL
CALENDAR MONTH FOLLOWING THE COMMENCEMENT DATE. EACH LEASE YEAR
THEREAFTER
SHALL CONSIST OF TWELVE (12) CONSECUTIVE CALENDAR MONTHS FOLLOWING
THE END
OF
THE IMMEDIATELY PRECEDING LEASE YEAR.
2.2
Holding Over. IN THE EVENT THAT TENANT RETAINS OCCUPANCY OF THE
PREMISES, OR ANY PART THEREOF, AFTER THE END OF THE TERM, TENANT'S
OCCUPANCY OF
THE PREMISES (OR PORTION THEREOF) SHALL BE AS A TENANT AT WILL
TERMINABLE AT ANY
TIME BY LANDLORD, UPON AT LEAST THIRTY (30) DAYS' NOTICE TO TENANT.
TENANT SHALL
PAY LANDLORD RENT FOR SUCH TIME AS TENANT REMAINS IN POSSESSION OF
THE PREMISES
(OR PORTION THEREOF) AT THE RATE EQUAL TO ONE HUNDRED FIFTY PERCENT
(150%) FOR
THE FIRST SIXTY (60) DAYS OF SUCH POSSESSION, AND THEREAFTER AT ONE
HUNDRED
SEVENTY-FIVE PERCENT (175%), OF THE ANNUAL BASE RENT PAYABLE DURING
THE LAST
MONTH OF THE LEASE TERM, PLUS ALL ADDITIONAL RENT AND OTHER SUMS
DUE UNDER THIS
LEASE. IN ADDITION, TENANT SHALL PAY LANDLORD FOR ALL DAMAGES
SUSTAINED BY
REASON OF TENANT'S RETENTION OF POSSESSION OF THE PREMISES AFTER
THE END OF THE
TERM AND LANDLORD'S INABILITY TO DELIVER TIMELY POSSESSION OF THE
PREMISES TO A
PROSPECTIVE TENANT WITHIN NINETY (90) DAYS AFTER LANDLORD NOTIFIES
TENANT THAT
LANDLORD REQUIRES POSSESSION OF THE PREMISES FOR A PROSPECTIVE
TENANT WHO HAS
SIGNED A LETTER OF INTENT WITH LANDLORD (BUT SUCH NOTICE SHALL NOT
BE DELIVERED
EARLIER THAN THE EXPIRATION DATE). THE PROVISIONS HEREOF DO NOT
LIMIT OR
RESTRICT LANDLORD'S RIGHTS OR REMEDIES UNDER THIS LEASE IN THE
EVENT OF ANY
HOLDING OVER BY TENANT.
ARTICLE 3 DELIVERY OF OCCUPANCY OF THE PREMISES
3.1
Tenant's Representations. TENANT REPRESENTS AND WARRANTS THAT:
3.1.1 Formation; Good Standing. Tenant is a corporation, duly
formed,
legally existing and in good standing under the laws of the State
of
Delaware and is duly qualified to transact business in the State
of
Connecticut. This Lease constitutes the valid and legally
binding
obligation of Tenant, enforceable against Tenant in accordance
2
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with
its terms. The execution and delivery of, and Tenant's
performance
under this Lease are within Tenant's powers and have been duly
authorized
by
all requisite corporate action;
3.1.2 Power and Authority. Tenant has full right, power and
authority
and
is duly authorized to enter into this Lease, to perform each of
the
covenants on its part to be performed hereunder and to execute and
deliver,
and
to perform its obligations under all documents required to be
executed
and
delivered by it pursuant to this Lease;
3.1.3 No Conflicts. Neither the execution, delivery or performance
of
this
Lease nor compliance herewith (a) conflicts or will conflict with
or
results or will result in a breach of or constitutes or will
constitute a
default under (1) the charter documents or by-laws of Tenant, (2)
to the
best
of Tenant's knowledge, any law or any order, writ, injunction
or
decree of any court or governmental authority, or (3) any agreement
or
instrument to which Tenant is a party or by which it is bound or
(b)
results in the creation or imposition of any lien, charge or
encumbrance
upon
its property pursuant to any such agreement or instrument;
3.1.4 Consents. No authorization, consent, or approval of any
governmental authority (including courts) is required for the
execution and
delivery by Tenant of this Lease or the performance of its
obligations
hereunder;
3.1.5 Pending Litigation. There are no actions, suits or
proceedings
pending or, to the knowledge of Tenant, threatened, against or
affecting
Tenant or the Property which, if determined adversely to Tenant,
would
adversely affect its ability to perform its obligations hereunder;
and
3.1.6 Patriot Act. Neither Tenant nor any individual (or entity
having
an
interest in Tenant) is a person or entity either (a) described
by
Section 1 of the Executive Order (No. 13,224) Blocking Property
and
Prohibiting Transactions With Persons Who Commit, Threaten to
Commit, or
Support Terrorism, 66 Fed. Reg. 49,079 (September 24, 2001), or (b)
is
listed on the current list of Specially Designated Nationals and
Blocked
Persons issued by the U.S. Department of the Treasury, and does not
engage
in
any dealings or transactions, and is not otherwise associated, with
any
such
persons or entities.
3.1.7 Business Use. Tenant currently occupies the Premises in
their
entirety for its business operations which involve general
office,
warehouse and "light" assembly;
3.1.8 Ownership. Tenant has owned and occupied the Property
since
April 28, 1998 and, to Tenant's knowledge, Tenant has conducted
its
business operations at
the Property in compliance with Applicable Laws and
is
currently in compliance with such Applicable Laws;
3.1.9 Construction. To Tenant's knowledge, Tenant constructed
the
Building and related improvements in accordance with all
"Applicable Laws"
(as
defined in Section 7.3); and Tenant has not received any notices
of
violation of any Applicable Laws with respect to the Building or
its
business operations at the Property;
3.1.10 Permits. To Tenant's knowledge, Tenant has obtained all
governmental permits and approvals required for its use occupancy
and
business operations at the Premises and such permits and approvals
are
currently in full force and effect; and
3.1.11 Building Systems. All "BUILDING SYSTEMS" (as defined in
Section
8.3)
are in good operating condition and to Tenant's knowledge, there is
no
condition at
3
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the
Property in need of repair or replacement or that constitutes a
violation of any Applicable Laws.
3.2
CONDITIONS OF THE PREMISES. Landlord leases the Premises to Tenant
"AS
IS" "WHERE IS" AND "WITH ALL FAULTS." Landlord makes no
representations or
warranties whatsoever with respect to the Premises. Tenant
acknowledges that it
has occupied the Premises since April 28, 1998 and has had full,
adequate and
complete opportunity to inspect the Building and the Property, and
that it is
fully and completely satisfied therewith. Landlord shall not have
any obligation
to make any repairs, to construct any improvements or to perform
any other work
to the Premises, except as set forth in Sections 6.1 and 8.1
hereof. If any
repairs, improvements, replacements or work should be necessary to
prepare the
Premises for Tenant's use and occupancy or to comply with Tenant's
maintenance,
repair and replacement obligations under this Lease, Tenant shall
perform such
additional work at its own cost and expense, and shall comply with
Article 8 in
doing so, except as otherwise stated herein.
3.3
LANDLORD'S REPRESENTATIONS. Landlord represents and warrants
that:
3.3.1 Formation; Good Standing. Landlord is a limited liability
company formed, legally existing and in good standing under the
laws of the
State of Massachusetts and is duly qualified to transact business
in the
State of Connecticut. This Lease constitutes the valid and legally
binding
obligation of Landlord, enforceable against Landlord in accordance
with its
terms. The execution and delivery of, and Landlord's performance
under this
Lease are within Landlord's powers and have been duly authorized by
all
requisite corporate action;
3.3.2 Power and Authority. Landlord has full right, power and
authority and is duly authorized to enter into this Lease, to
perform each
of
the covenants on its part to be performed hereunder and to execute
and
deliver, and to perform its obligations under all documents
required to be
executed and delivered by it pursuant to this Lease;
3.3.3 No Conflicts. Neither the execution, delivery or performance
of
this
Lease nor compliance herewith (a) conflicts or will conflict with
or
results or will result in a breach of or constitutes or will
constitute a
default under (1) the operating agreement of Landlord, (2) to the
best of
Landlord's knowledge, any law or any order, writ, injunction or
decree of
any
court or governmental authority, or (3) any agreement or instrument
to
which Landlord is a party or by which it is bound or (b) results in
the
creation or imposition of any lien, charge or encumbrance upon its
property
pursuant to any such agreement or instrument;
3.3.4 Consents. No authorization, consent, or approval of any
governmental authority (including courts) is required for the
execution and
delivery by Landlord of this Lease or the performance of its
obligations
hereunder;
3.3.5 Pending Litigation. There are no actions, suits or
proceedings
pending or, to the knowledge of Landlord, threatened, against or
affecting
Landlord or the Property which, if determined adversely to
Landlord, would
adversely affect its ability to perform its obligations hereunder;
and
3.3.6 Patriot Act. Neither Landlord nor any individual (or
entity
having an interest in Landlord) is a person or entity either (a)
described
by
Section 1 of the Executive Order (No. 13,224) Blocking Property
and
Prohibiting Transactions With Persons Who Commit, Threaten to
Commit, or
Support Terrorism, 66 Fed. Reg. 49,079 (September 24, 2001), or (b)
is
listed on the current list of Specially Designated Nationals and
Blocked
Persons issued by the U.S. Department of the Treasury, and does not
engage
in
any dealings or transactions, and is not otherwise associated, with
any
such
persons or entities.
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ARTICLE 4 RENT AND SECURITY
4.1
Annual Base Rent.
4.1.1 SCHEDULE MONTHLY INSTALLMENTS. BEGINNING WITH THE
COMMENCEMENT
DATE
AND CONTINUING THROUGHOUT THE TERM, TENANT SHALL PAY TO OR UPON
THE
ORDER OF LANDLORD AN ANNUAL RENTAL (THE "Annual Base Rent") AS SET
FORTH
BELOW WHICH SHALL BE PAYABLE IN CONSECUTIVE MONTHLY INSTALLMENTS ON
OR
BEFORE THE FIRST DAY OF EACH CALENDAR MONTH IN ADVANCE IN THE
MONTHLY
AMOUNT SET FORTH BELOW:
PERIOD
ANNUAL BASE RENT
MONTHLY BASE RENT
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----------------
-----------------
Lease Year 1
$244,800.00
$20,400.00
Lease Year 2
$244,800.00
$20,400.00
Lease Year 3
$244,800.00
$20,400.00
Lease Year 4
$244,800.00
$20,400.00
Lease Year 5
$244,800.00
$20,400.00
Lease Year 6
$268,800.00
$22,400.00
Lease Year 7
$268,800.00
$22,400.00
Lease Year 8
$268,800.00
$22,400.00
Lease Year 9
$268,800.00
$22,400.00
Lease Year 10
$268,800.00
$22,400.00
4.1.2 MANNER OF PAYMENT. ALL PAYMENTS OF RENT SHALL BE MADE
WITHOUT
DEMAND, DEDUCTION, COUNTERCLAIM, SET-OFF, DISCOUNT OR ABATEMENT IN
LAWFUL
MONEY OF THE UNITED STATES OF AMERICA, EXCEPT AS OTHERWISE STATED
HEREIN.
IF
THE COMMENCEMENT DATE SHOULD OCCUR ON A DAY OTHER THAN THE FIRST
DAY OF
A
CALENDAR MONTH, OR THE EXPIRATION DATE SHOULD OCCUR ON A DAY OTHER
THAN
THE
LAST DAY OF A CALENDAR MONTH, THEN THE MONTHLY INSTALLMENT OF
ANNUAL
BASE
RENT FOR SUCH FRACTIONAL MONTH SHALL BE PRO-RATED UPON A DAILY
BASIS
BASED UPON A THIRTY (30)-DAY MONTH.
4.2
Additional Rent. TENANT SHALL PAY TO LANDLORD ALL CHARGES AND
OTHER
AMOUNTS REQUIRED UNDER THIS LEASE AND THE SAME SHALL CONSTITUTE
ADDITIONAL RENT
HEREUNDER (HEREIN CALLED "Additional Rent"), INCLUDING, WITHOUT
LIMITATION, ANY
SUMS DUE RESULTING FROM THE PROVISIONS OF ARTICLE 5 HEREOF. ALL
SUCH AMOUNTS AND
CHARGES SHALL BE PAYABLE TO LANDLORD AT THE PLACE WHERE THE ANNUAL
BASE RENT IS
PAYABLE. LANDLORD SHALL HAVE THE SAME REMEDIES FOR A DEFAULT IN THE
PAYMENT OF
ADDITIONAL RENT AS FOR A DEFAULT IN THE PAYMENT OF ANNUAL BASE
RENT. THE TERM
"Rent" AS USED IN THIS LEASE SHALL MEAN THE ANNUAL BASE RENT AND
THE ADDITIONAL
RENT.
4.3
Place of Payment. THE ANNUAL BASE RENT AND ALL OTHER SUMS PAYABLE
TO
LANDLORD UNDER THIS LEASE SHALL BE PAID TO LANDLORD AT C/O DAVIS
MARCUS
MANAGEMENT CORP., 200 CONNECTICUT AVENUE, NORWALK, CONNECTICUT
06854, OR AT SUCH
OTHER PLACE AS LANDLORD SHALL DESIGNATE IN WRITING TO TENANT FROM
TIME TO TIME.
4.4
Terms of Payment. TENANT SHALL PAY TO LANDLORD ALL ANNUAL BASE RENT
AS
PROVIDED IN SECTION 4.1 ABOVE AND TENANT SHALL PAY ALL ADDITIONAL
RENT PAYABLE
UNDER ARTICLE 5 AND ARTICLE 6 ON THE TERMS PROVIDED THEREIN. EXCEPT
AS PROVIDED
IN THE IMMEDIATELY PRECEDING SENTENCE AND AS MAY OTHERWISE BE
EXPRESSLY PROVIDED
BY THE TERMS OF THIS LEASE, TENANT SHALL PAY ALL OTHER RENT TO
LANDLORD, WITHIN
FIFTEEN (15) DAYS AFTER DELIVERY BY LANDLORD TO TENANT OF BILLS OR
STATEMENTS
THEREFOR.
4.5
Late Charges. IF TENANT SHALL FAIL TO PAY ANY RENT WITHIN FIVE (5)
DAYS
AFTER THE DATE SAME IS DUE AND PAYABLE OR IF ANY CHECK RECEIVED BY
LANDLORD FROM
TENANT SHALL
5
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BE DISHONORED, TENANT AGREES THAT LANDLORD'S ACTUAL DAMAGES
RESULTING THEREFROM
ARE DIFFICULT TO FIX OR ASCERTAIN. AS A RESULT, TENANT SHALL PAY TO
LANDLORD (A)
AN ADMINISTRATIVE FEE EQUAL TO FIVE PERCENT (5%) ON THE AMOUNT DUE,
AND (B)
INTEREST ON THE AMOUNT DUE FROM ITS DUE DATE UNTIL PAID AT THE
LESSER OF
EIGHTEEN PERCENT (18%) PER ANNUM OR THE MAXIMUM LEGAL RATE THAT
LANDLORD MAY
CHARGE TENANT; PROVIDED, THAT, ON THE FIRST (1ST) OCCASION ONLY
DURING EACH
LEASE YEAR, NO SUCH CHARGES OR INTEREST SHALL BE PAYABLE WITH
RESPECT TO ANY
DELINQUENT PAYMENT IF SUCH PAYMENT IS RECEIVED BY LANDLORD WITHIN
FIVE (5) DAYS
FOLLOWING WRITTEN NOTICE OF SUCH FAILURE. SUCH CHARGES SHALL BE
PAID TO LANDLORD
TOGETHER WITH SUCH UNPAID AMOUNTS AS AN ADMINISTRATIVE FEE TO
COMPENSATE
LANDLORD FOR ADMINISTRATIVE EXPENSES AND ITS COST OF FUNDS. SUCH
LATE PAYMENT
CHARGE SHALL NOT DIMINISH OR IMPAIR ANY OTHER REMEDIES AVAILABLE TO
LANDLORD.
4.6
Security Deposit.
4.6.1 Financial Covenant. Tenant covenants and agrees that it
shall
comply with the following financial covenants during the Term:
(a) Tenant shall maintain an unrestricted and unencumbered
balance of at least $600,000.00 with a U.S. banking institution
in
cash and cash equivalent financial instruments ("CCE") (the
"REQUIRED
CCE FLOOR BALANCE") during the first Lease Year. On the first day
of
the second Lease Year and on the first day of each succeeding
Lease
Year
thereafter, the Required CCE Floor Balance shall increase
automatically, and without notice, to an amount equal to one
hundred
three percent (103%) of the Required CCE Floor Balance
applicable
during the immediately preceding Lease Year; and
(b) Tenant shall maintain net current assets (determined in
accordance with generally accepted accounting principles ("GAAP"))
of
not less than $3,600,000.00 (the "REQUIRED NCA AMOUNT").
To facilitate
Landlord's verification of Tenant's compliance with
these financial maintenance covenants, Tenant shall deliver
reasonably
satisfactory evidence (the "COMPLIANCE DOCUMENTS") to Landlord of
its
compliance with its obligation to maintain the applicable Required
CCE
Floor Balance and the Required NCA Amount. During any period that
Tenant is
a
publicly-traded U.S. Company, Tenant's compliance with the
financial
reporting required by Section 16.12 shall be sufficient to satisfy
Tenant's
obligation to deliver such Compliance Documents. During any period
that
Tenant is not a publicly-traded U.S. company, Tenant's delivery
of
financial statements in the form required by Subsection 16.12.1
hereof
substantiating the current CCE balance on deposit and the value of
Tenant's
net
current assets shall be sufficient to satisfy Tenant's obligation
to
deliver such Compliance Documents provided that the same are
delivered to
Landlord (i) within ten (10) business days following Landlord's
written
request therefor, and (ii) within thirty (30) days following the
end of the
quarter of each fiscal year during the Term, in each case together
with an
officer's certificate confirming Tenant's compliance with the
covenants
stated in Subsection 4.1.6(a) and (b) above.
Tenant shall also notify Landlord and deliver such Compliance
Documents to Landlord immediately if Tenant's CCE decreases below
the
applicable Required CCE Floor Balance or Tenant's net current
assets
(determined in accordance with GAAP) decreases below the Required
NCA
Amount.
In addition, Tenant shall deliver the same financial information
to
Landlord's institutional lenders and venture partners within ten
(10) days
following written request therefor by such requesting party
(subject to
delivery to Tenant of a commercially reasonable confidentiality
agreement
with
regard to such financing information, which requirement shall be
no
more
often than twice in any calendar year, exclusive of any
6
<PAGE>
request in connection with the sale or refinancing of the Property.
If
Tenant fails to deposit and maintain the "Security Deposit" (as
defined
below) in the amounts and in the manner stated herein, such event
shall
constitute an Event of Default for which Tenant shall not be
entitled to
any
notice or cure period under Article 13.
4.6.2 Security Deposit Requirement. Landlord shall have the right
to
require Tenant to deliver a security deposit (the "SECURITY
DEPOSIT") equal
to
nine (9) months of Rent payable under this Lease (based upon the
rentals
payable for the next succeeding Lease Year) if at any time: (a)
Tenant's
CCE
decrease below the applicable Required CCE Floor Amount, and (b)
the
value of Tenant's net current assets (determined in accordance with
GAAP)
decreases below the Required NCA Amount. Tenant shall deliver the
required
Security Deposit within thirty (30) days following Landlord's
written
request. Tenant shall maintain the full amount of such Security
Deposit
during the balance of the Term and any subsequent periods required
hereby.
The Security Deposit
shall secure the faithful performance of all terms,
covenants and conditions of this Lease. Tenant's Security Deposit
shall be
in
the form of a cash payment (a "CASH PAYMENT") or a "LETTER OF
CREDIT"
(as
defined below).
4.6.3 Letter of Credit Requirements. Any letter of credit provided
to
Landlord hereunder shall be in the form of an unconditional,
irrevocable
letter of credit which Tenant shall maintain in full force and
effect for
the
Term, and shall meet all of the following conditions (a "LETTER
OF
CREDIT"):
(a) it shall be issued for the benefit of Landlord by an
"ELIGIBLE BANK" (defined below) approved by Landlord;
(b) it shall be effective on the date of this Lease and have a
term of not less than one (1) year following its date of issuance
and
contain automatic year-to-year renewal provisions subject to
the
Letter of Credit issuer's obligation to notify Landlord in writing
by
certified or registered mail of non-renewal at least sixty (60)
days
prior to the expiration of the Letter of Credit;
(c) the expiry date of the Letter of Credit for the final Lease
Year of the Term shall be at least ninety-five (95) days following
the
Expiration Date of the Lease;
(d) it shall provide for the amount thereof as set forth in
Subsection 4.6.2 to be available to the Landlord in multiple
drawings
conditioned only upon presentation of a sight draft;
(e) it shall be assignable by Landlord to its successors,
assigns
and mortgagees and by any successive beneficiaries thereof at no
cost
to transferor or transferee (Tenant agreeing to pay such charges
in
connection with any transfer of the Letter of Credit), and
(f) it shall be in the form attached hereto as Exhibit E or in
such form as shall be acceptable to Landlord.
An
"ELIGIBLE BANK" shall mean a commercial or savings bank
organized
under the laws of the United States or any state thereof or the
District of
Columbia and having total assets in excess of One Billion and
00/100
Dollars ($1,000,000,000.00) which shall be a financial institution
having a
rating of not less than BBB or its equivalent by Standard and
Poors
Corporation and subject to a Fitch's Rating of C or better. Tenant,
at its
expense, shall cause the issuing bank to provide Landlord's
mortgage lender
with
a written instrument which acknowledges the collateral assignment
of
the
proceeds of the Letter of Credit to the Mortgagee and recognizes
such
Mortgagee's security interest in
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the
proceeds of the Letter of Credit within seven (7) days following
the
request of Landlord or Landlord's mortgagee therefor.
4.6.4 Substitution Upon Non-Renewal of Letter of Credit. Tenant
shall
deliver to Landlord either: (i) a substitute Letter of Credit
that
satisfies the requirements for a Letter of Credit stated in this
Subsection
4.6.4, or (ii) a Security Deposit in the form of a Cash Payment in
the
amount specified in Subsection 4.6.2 for the applicable period not
later
than
ten (10) days following delivery of a non-renewal notice by the
Letter
of
Credit issuer with respect to the Letter of Credit issued to
Landlord or
forty-five (45) days prior to the scheduled expiration of the
Letter of
Credit, whichever first occurs (such date, the "RE-DELIVERY
DEADLINE"). If
Tenant fails to deliver the substitute Letter of Credit or Cash
Payment
within such ten (10)-day period, Landlord shall have the right to
draw the
Letter of Credit and
receive the proceeds as a cash Security Deposit.
Tenant agrees that notwithstanding any provision of this Lease to
the
contrary, its failure to furnish Landlord with the required
Security
Deposit either in the form of a substitute Letter of Credit or as a
Cash
Payment in compliance with the requirements for the initial Letter
of
Credit prior to the Re-Delivery Deadline shall not be subject to
any rights
of
notice or cure under this Lease.
4.6.5 Landlord's Rights Upon Default. Upon the occurrence of any
of
the
Events of Default described in Article 13 hereof, after the
delivery of
any
default notice and the expiration of any cure periods expressly
provided by the terms of this Lease, in addition to any other right
or
remedies available to Landlord under this Lease, the Security
Deposit shall
become due and payable to Landlord in accordance with the terms
hereof.
Tenant agrees that Landlord may, without waiving any of Landlord's
other
rights and remedies under this Lease, upon the occurrence of any of
the
Events of Default, apply the Security Deposit to remedy any failure
by
Tenant to perform any of the terms, covenants or conditions to be
performed
by Tenant under this
Lease and to compensate Landlord for any damages
incurred as a result of any such default, including payment of
Landlord's
expenses to construct the Leasehold Improvements and pay leasing
brokerage
commissions with respect to this Lease. If Landlord uses any
portion of the
Security Deposit to cure any Event of Default by Tenant hereunder,
Tenant
shall forthwith replenish the Security Deposit to the original
amount
within ten (10) days following written notice from Landlord in the
manner
directed by Landlord in such notice. If Tenant fails to restore the
full
amount of the Security Deposit within such ten (10)-day period,
then the
amount of such deficiency shall be subject to the charges described
in
Section 4.5 hereof. During any period that Landlord is holding the
Security
Deposit in the form of cash, Landlord shall not be required to keep
the
Security Deposit separate from its general funds, and Tenant shall
not be
entitled to interest on any such deposit.
4.6.6 Sale of Building. In the event of a sale or other transfer
of
the
Building (or Landlord's interest therein), Landlord shall have
the
right to transfer the balance of the Security Deposit to the new
owner or
transferee. Upon any such transfer by Landlord and the receipt by
the
successor landlord of the Security Deposit and the assumption by
the
successor landlord or all of Landlord's obligations under this
Lease,
Landlord shall thereupon be released by Tenant from all liability
for the
return of the Security Deposit; and Tenant agrees to look to the
new
landlord for the return of such Security Deposit. If Tenant is not
in
default hereunder at the end of the Term, Landlord will, within
ninety-five
(95)
days after the expiration or earlier termination of the Lease,
return
the
Security Deposit, or so much as has not been applied by Landlord,
to
Tenant or the last permitted assignee of Tenant's interest
hereunder at the
expiration of the Term.
4.6.7 Substitution of Letter of Credit. If Tenant initially
provides
the
Security Deposit to Landlord in the form of a Cash Payment, it
may
substitute for such Cash Payment a Letter of Credit pursuant to
the
requirements of this Section 4.6 prior to the final six (6) months
of the
Term
provided that no Event of Default has occurred and is
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continuing after the delivery of any default notice and the
expiration of
any
cure periods expressly provided by the terms of this Lease. In
the
event of such a substitution (but subject to the delivery of a
Letter of
Credit in conformity with the requirements of Subsection 4.6.3),
Tenant
shall deliver to Landlord the Letter of Credit for its prior review
and
approval at least seven (7) business days prior to the scheduled
date of
such
substitution. Landlord shall return the Cash Security Deposit
to
Tenant not later than five (5) business days following Landlord's
receipt
of a
Letter of Credit satisfying the requirements of this Section 4.6
in
substitution of the Cash Payment.
4.6.8. Substitution of Cash Payment. Tenant may substitute a
Cash
Payment (payable in immediately available funds) as a Security
Deposit in
exchange for a Letter of Credit at any time during the Term
provided that
no
Event of Default has occurred and is continuing. In the event of
such a
substitution of a Cash Payment for a Letter of Credit, Tenant shall
provide
Landlord with at least seven (7) business days' prior written
notice of
such
substitution, and Landlord shall return the Letter of Credit to
Tenant
not
later than five (5) business days following Landlord's receipt of
the
substituted Cash Payment.
ARTICLE 5 ADDITIONAL RENT FOR PROJECT EXPENSES
5.1
Tenant's Payment Obligations; Definitions. THE PARTIES HERETO
HAVE
ENTERED INTO THIS LEASE WITH THE INTENTION THAT TENANT SHALL PAY TO
LANDLORD, IN
ADDITION TO ANNUAL BASE RENT, ANY AND ALL IMPOSITIONS, TAXES, REAL
ESTATE TAXES,
UTILITIES, LIENS, CHARGES OR EXPENSES OF ANY NATURE WHATSOEVER
(INCLUDING BOTH
NON-CAPITAL AND CAPITAL EXPENDITURES) IN CONNECTION WITH THE
MAINTENANCE, REPAIR
(INCLUDING REPLACEMENTS), AND OPERATION OF THE PREMISES, EXCEPT TO
THE EXTENT
CAUSED BY THE NEGLIGENCE OR WILLFUL MISCONDUCT OF LANDLORD, ITS
AGENTS,
EMPLOYEES OR CONTRACTORS AND EXCEPT TO THE EXTENT OTHERWISE
EXPRESSLY STATED IN
THIS LEASE. TENANT AGREES TO PAY AS ADDITIONAL RENT, AN AMOUNT
CALCULATED AS
HEREINAFTER SET FORTH. FOR PURPOSES OF THIS ARTICLE 5, THE
FOLLOWING DEFINITIONS
SHALL APPLY:
"TAX YEAR": The fiscal year of the Town of Branford or other
applicable
governmental authority for real estate tax purposes or such other
twelve
(12)-month period as may hereafter be duly adopted in place
thereof. The first
Tax Year for purposes of this Lease shall be the period July 1,
2006 to June 30,
2007. Each Tax Year thereafter shall consist of twelve (12)
consecutive calendar
months following the end of the immediately preceding Tax Year.
"TAXES": All taxes, assessments and charges of every kind and
nature
levied, assessed or imposed at any time by any governmental
authority upon or
against the Property or any improvements, fixtures and equipment of
Landlord
used in the operation thereof whether such taxes and assessments
are general or
special, ordinary or extraordinary, foreseen or unforeseen in
respect of each
Tax Year falling wholly or partially within the Term. Taxes shall
include,
without limitation, all general real property taxes and general and
special
assessments, charges, fees or assessments for all governmental
services or
purported benefits to the Property, service payments in lieu of
taxes, all
business privilege taxes, and any tax, fee or excise on the act of
entering into
this Lease or any other lease of space in the Building, or on the
use or
occupancy of the Building or any part thereof, or on the rent
payable under any
lease or in connection with the business of renting space under any
lease or in
connection with the business of renting space in the Building, that
are now or
hereafter levied or assessed against Landlord by the United States
of America,
the State of Connecticut, or any political subdivision, public
corporation,
district or other political or public entity, including reasonable
legal fees,
experts' and other witnesses' fees, costs and disbursements
incurred in
connection with proceedings to contest, determine or reduce Taxes.
Taxes shall
also include any other tax, fee or other excise, however described,
that may be
levied or assessed as a substitute for, or as an addition to, in
whole or in
part, any other Taxes (including, without limitation, any municipal
income tax)
and any license fees, tax measured or imposed upon rents, or other
tax or charge
upon Landlord's business of leasing the Building, whether or not
now customary
or in the contemplation of the parties on the date of this
Lease.
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Taxes shall not include: (a) franchise, transfer, gift, excise,
capital
stock, estate, succession and inheritance taxes, and federal and
state income
taxes measured by the net income of Landlord from all sources,
unless due to a
change in the method of taxation such tax is levied or assessed
against Landlord
as a substitute for, or as an addition to, in whole or in part, any
other Tax
that would constitute a Tax; (b) penalties or interest for late
payment of
Taxes; and (c) any assessment for special improvements to the
Property required
by the Town of Branford or the State of Connecticut that solely
benefit a
Building addition or new building constructed by Landlord under
Article 18 or
Article 19 hereof, including, without limitation, widening of
public roads,
installation of, or hookup to, public sewer lines, public sanitary
and storm
drainage systems and other public utility lines and installations.
In the event
that the entire amount of any substitute Tax cannot legally be paid
or
reimbursed to Landlord by tenants of the Building, Landlord will
have the option
to terminate this Lease upon ninety (90) days notice to Tenant.
In the event that Landlord constructs an addition to the Building
or a
new building (in either such case, the "NEW BUILDING") on the
Property pursuant
to either Section 1.4 or Article 19 and Tenant is the sole tenant
of such New
Building and the Property, then the Taxes attributable to such New
Building
shall be included in Common Operating Expenses under this Lease and
Tenant's
Common Share shall be adjusted as provided in the definition of
Tenant' Common
Share in determining Tenant's liability for the payment of Common
Operating
Expenses.
In the event that Landlord constructs a New Building and Tenant is
not
the sole tenant of the New Building and the Property and the Taxes
attributable
to the New Building are separately assessed by the Town of
Branford, then the
Taxes attributable to the New Building shall not be included in the
Common
Operating Expenses payable by Tenant under this Lease (and Tenant's
Common Share
shall not be adjusted to account for the increased square foot area
of the
improvements on the Property in determining Tenant's liability for
the payment
of Taxes attributable to the Building); provided, however, in such
case, (i)
Tenant's Common Share shall be adjusted as specified above with
respect to the
payment of Taxes attributable to the Land, or, if the Land is not
separately
assessed, then Landlord shall equitably determine and apportion the
Taxes
applicable to the Land among the tenants of the Property; and (ii)
Tenant shall
be responsible for its proportionate share of the Taxes assessed on
the New
Building under the terms of the lease agreement to be executed by
Landlord and
Tenant for the space to be leased by Tenant therein.
In the event that Landlord constructs a New Building and Tenant is
not
the sole tenant of the New Building and the Property and the Taxes
attributable
to the New Building are not separately assessed by the Town of
Branford, then
Landlord shall equitably determine and apportion the Taxes
applicable to the New
Building among the tenants of the New Building (based upon the
square footage of
the space leased by each such tenant in the New Building relative
to the total
square footage of the New Building); and the Taxes attributable to
the New
Building shall not be included in the Common Operating Expenses
payable by
Tenant under this Lease (and Tenant's Common Share shall not be
adjusted to
account for the increased square foot area of the improvements on
the Property
in determining Tenant's liability for the payment of Taxes
attributable to the
Building); provided, however, in such case, (i) Landlord shall
equitably
apportion the Taxes applicable to the Land among the tenants of the
Property
(based upon the square footage of the space leased by each such
tenant relative
to the total square footage of all buildings at the Property); and
(ii) Tenant
shall be responsible for its proportionate share of the Taxes
assessed on the
New Building under the terms of the lease agreement to be executed
by Landlord
and Tenant for the space to be leased by Tenant therein.
"OPERATING EXPENSES": All costs and expenses (and taxes, if
any,
thereon) paid or incurred on behalf of Landlord (whether directly
or through
independent contractors) in connection with the following matters
(including any
sales or other taxes thereon):
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MAINTENANCE AND REPAIR OF THE (I) BUILDING'S ROOFING AND
FLASHING
(EXCLUDING ANY OF THE ROOF'S STRUCTURAL COMPONENTS); (II) BUILDING
BASE
BUILDING ROOF-TOP HVAC UNITS (AND RELATED COMPONENT EQUIPMENT)
IDENTIFIED
IN
EXHIBIT H ATTACHED HERETO AS THE "BASE BUILDING HVAC UNITS", AND
(III)
THE
ASPHALT PAVED PARKING AREAS AND DRIVEWAYS;
LANDSCAPING AND GROUNDS MAINTENANCE, INCLUDING LAWN MOWING,
TREE
PRUNING, ANNUAL FLOWER PLANTING, SNOW PLOWING AND SWEEPING OF THE
PARKING
LOT;
AND THE MAINTENANCE AND REPAIR OF ANY EXISTING IRRIGATION
SYSTEM;
THE CAPITAL COSTS INCURRED WITH RESPECT TO THE MAINTENANCE AND
REPAIR
OF
THE PROPERTY FOR REPAIRS, ALTERATIONS, INSTALLATIONS, IMPROVEMENTS
AND
ADDITIONS PERFORMED BY LANDLORD IN ACCORDANCE WITH ITS OBLIGATIONS
UNDER
SECTION 5.6.1 AND SECTION 6.1 HEREOF (SPECIFICALLY EXCLUDING THE
CAPITAL
COSTS OF LANDLORD'S REPLACEMENT OBLIGATIONS AS DEFINED IN SECTION
8.1
HEREOF); AND ANY CAPITAL COSTS INCURRED BY LANDLORD TO COMPLY WITH
LAWS,
REGULATIONS OR ORDERS OF ANY GOVERNMENTAL OR QUASI-GOVERNMENTAL
AUTHORITY,
AGENCY OR DEPARTMENT WHICH WERE ENACTED OR BECAME EFFECTIVE AFTER
THE DATE
HEREOF (EXCEPT ANY SUCH LEGAL COMPLIANCE MATTERS THAT ARE
TENANT'S
RESPONSIBILITY UNDER THIS LEASE WHICH SHALL AT TENANT'S SOLE COST);
WHICH
CAPITAL COSTS SHALL BE AMORTIZED OVER THE USEFUL LIFE OF THE
CAPITAL ITEM
AS
DETERMINED IN THE REASONABLE JUDGMENT OF LANDLORD'S ACCOUNTANT
IN
ACCORDANCE WITH GAAP
TOGETHER WITH INTEREST, AT A RATE OF INTEREST EQUAL TO
THE
"PRIME RATE" (AS DEFINED IN SECTION 5.4.2 HEREOF AS IN EFFECT FROM
TIME
TO
TIME DURING SUCH PERIOD) PLUS TWO AND ONE-HALF PERCENT (2.50%)
PER
ANNUM, ON THE UNAMORTIZED BALANCE OF THE COST OF SUCH CAPITAL
ITEMS;
a) THE PREMIUMS FOR FIRE, EXTENDED COVERAGE, LOSS OF RENTS,
BOILER,
MACHINERY, SPRINKLER, PUBLIC LIABILITY, PROPERTY DAMAGE,
EARTHQUAKE, FLOOD,
AND
OTHER INSURANCE RELATIVE TO THE BUILDING AND THE PROPERTY AND
THE
OPERATION AND MAINTENANCE THEREOF, INCLUDING COMPREHENSIVE
GENERAL
LIABILITY INSURANCE AND UNREIMBURSED COSTS INCURRED BY LANDLORD
THAT ARE
SUBJECT TO AN INSURANCE DEDUCTIBLE (THE "Insurance Expenses");
(e)
SUPPLIES, MATERIALS AND EQUIPMENT PURCHASED OR RENTED, TOTAL
WAGE
AND
SALARY COSTS PAID TO, AND ALL CONTRACT PAYMENTS MADE ON ACCOUNT OF,
ALL
PERSONS TO THE EXTENT ENGAGED IN THE OPERATION, MAINTENANCE AND
REPAIR OF
THE
PROPERTY AT OR BELOW THE LEVEL OF BUILDING MANAGER (INCLUDING
THE
AMOUNT OF ANY TAXES, SOCIAL SECURITY TAXES, UNEMPLOYMENT
INSURANCE
CONTRIBUTIONS, UNION BENEFITS) AND ANY ON-SITE EMPLOYEES OF
LANDLORD'S
PROPERTY MANAGEMENT AGENT;
(f) Office costs of administration, legal and accounting fees
and
other expenses of maintaining and auditing Property accounting
records and
preparing Landlord's Statements; and
(g) Fees for management services whether rendered by Landlord
(or
affiliate) or a third party
property manager in an amount equal to three
percent (3%) of the Rent in each Lease Year.
Operating Expenses shall not include: (1) all costs, fees and
disbursements
relating to activities for the solicitation, negotiation and
execution of leases
for space at the Property (including but not limited to advertising
costs,
leasing commissions and attorneys' fees therefor); (2) the costs of
alterations
to, or the decorating or the redecorating of, space at the Property
leased to
other tenants; (3) the costs of selling, syndicating, financing or
mortgaging
any of Landlord's interest in the Property; (4) rentals payable
under any ground
or underlying lease; (5) depreciation, interest and principal
payments on
mortgages and other debt costs, if any; (6) expenses incurred by
Landlord for
repairs or other work occasioned by fire, windstorm, or other
insurable casualty
or condemnation (except as stated in clause (g) above); (7)
expenses incurred
11
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by Landlord to resolve disputes, enforce or negotiate lease terms
with
prospective or existing tenants or in connection with any
financing, sale or
syndication of the Property; (8) expenses for the replacement of
any item
covered under warranty; (9) cost to correct any penalty or fine
incurred by
Landlord due to Landlord's violation of any federal, state, or
local law or
regulation and any interest or penalties due for late payment by
Landlord of any
of the Operating Expenses; (10) cost of repairs necessitated by
Landlord's
negligence or willful misconduct, or of correcting any latent
defects or
original design defects in any new building construction,
materials, or
equipment; (11) expenses for any item or service which Tenant pays
directly to a
third party or separately reimburses Landlord and expenses incurred
by Landlord
to the extent the same are reimbursable or reimbursed from any
other tenants,
occupants of the property, or third parties; (12) expenses for any
item or
service not provided to Tenant but exclusively to certain other
tenants in the
Building; (13) salaries of (i) employees above the grade of
building
superintendent or building manager, and (ii) that portion of
employee expenses
for employees whose time is not spent directly and solely in the
operation of
the Property; (14) Landlord's general corporate overhead and
administrative
expenses; (15) expenses incurred by Landlord in order to comply
with Landlord's
environmental obligations hereunder; (16) reserves; (17) fees paid
to affiliates
of Landlord to the extent that such fees exceed the customary
amount charged for
the services provided; and (18) capital costs paid to replace the
Building's
roofing and flashing (excluding the structural components of the
roof which is
Tenant's responsibility), the Building's base building rooftop HVAC
units (and
related major components) and the asphalt paved parking areas and
driveways at
the Property.
Notwithstanding anything in this Lease to the contrary, if (a) it
is
established by Landlord or Tenant that a manufacturer's and/or
contractor's roof
warranty or guaranty (the "ROOF WARRANTY") was issued by the
manufacturer or
contractor of the roof of the Building, (b) the coverage period
(the "COVERAGE
PERIOD") of such Roof Warranty includes any portion of the Term of
this Lease,
and (c) a claim arises during the Coverage Period due to the need
for
maintenance, repair or replacement of the Building roof or roofing
by Landlord
that is Landlord's responsibility under the terms of this Lease and
the expense
of which work would be covered by the terms of the Roof Warranty (a
"WARRANTY
CLAIM") but Landlord is not able to make such claim under the Roof
Warranty due
to the fact that such Roof Warranty has not been delivered and
assigned to
Landlord by Tenant in compliance with the requirements of the Roof
Warranty,
then all expenses incurred by Landlord with respect thereto shall
be included
within the definition of Operating Expenses and payable by Tenant
as a Building
Operating Expense under Section 5.4 hereof.
"BUILDING OPERATING EXPENSES": Shall mean all Operating Expenses
which
relate to the Building, as determined by Landlord in its reasonable
judgment.
"COMMON OPERATING EXPENSES": Shall mean the Taxes, Insurance
Expenses
and all Operating Expenses which relate to the Land, the Common
Areas and any
other portions of the Property, exclusive of the Building, as
determined by
Landlord in its reasonable judgment.
"TENANT'S BUILDING SHARE": Tenant's Building Share shall be a
fraction,
the numerator of which shall be the rentable area of the Premises
and the
denominator of which shall be the rentable area of the Building. On
the
Commencement Date, the Tenant's Building Share is one hundred
percent (100%).
The Tenant's Building Share shall be recalculated from time to time
in the event
that there shall be a change in the rentable area of either the
Premises or the
Building.
"TENANT'S COMMON SHARE": Shall be a fraction, the numerator of
which is
the rentable area of the Premises and the denominator of which
shall be the
rentable area of all buildings located on the Property. On the
Commencement
Date, the Building is the only building on the Property and the
Tenant's
Property Share is one hundred percent (100%). The Tenant's Property
Share shall
be recalculated from time to time in the event that there shall be
a change in
the rentable area of the Premises, the Building or the total
rentable square
footage of all buildings located on the Property.
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"LANDLORD'S STATEMENT": An instrument containing a computation of
any
Additional Rent due pursuant to the provisions of this Article 5
together with a
reasonably detailed breakdown, by category, of actual Operating
Expenses for
such time period.
"TRANSITION EVENT": Shall occur if Landlord enters into a lease
with
any person, except the Tenant named in this Lease, with respect to
any building
located at the Property. If such lease entails the construction of
any new
building or improvements for such tenant's occupancy, then the
Transition Event
shall not occur until Landlord's completion of such construction
and the
commencement of the lease term of such lease.
5.2
Payment of Additional Rent.
5.2.1 BUILDING
OPERATING EXPENSES. TENANT SHALL PAY TENANT'S BUILDING
SHARE OF BUILDING OPERATING EXPENSES MONTHLY IN ADVANCE BEGINNING
ON THE
COMMENCEMENT DATE AND CONTINUING ON THE FIRST DAY OF EACH CALENDAR
MONTH
THROUGHOUT THE TERM. LANDLORD MAY REQUIRE THAT TENANT PAY TENANT'S
BUILDING
SHARE OF BUILDING OPERATING EXPENSES BASED ON LANDLORD'S WRITTEN
ESTIMATE
THEREOF DELIVERED TO TENANT FROM TIME TO TIME, AND UPON TENANT'S
RECEIPT OF
ANY
SUCH NOTICE FROM LANDLORD, THE AMOUNT OF SUCH MONTHLY
INSTALLMENT
PAYMENTS SHALL CHANGE CONSISTENT WITH LANDLORD'S WRITTEN ESTIMATE.
WITHIN A
REASONABLE TIME AFTER THE END OF EACH CALENDAR YEAR, LANDLORD SHALL
FURNISH
TO
TENANT A NOTICE AS TO WHETHER THE ESTIMATED PAYMENTS PAID BY TENANT
WERE
MORE
OR LESS THAN ACTUAL BUILDING OPERATING EXPENSES. WITHIN FIFTEEN
(15)
DAYS
FOLLOWING DELIVERY OF A LANDLORD'S STATEMENT, TENANT SHALL PAY
TO
LANDLORD THE AMOUNT OF ANY UNDERPAYMENT OF BUILDING OPERATING
EXPENSES. IN
THE EVENT THAT
TENANT'S PAYMENTS EXCEED ITS LIABILITY FOR BUILDING
OPERATING EXPENSES, ANY SUCH OVERPAYMENT SHALL BE CREDITED AGAINST
THE
MONTHLY INSTALLMENTS THAT ARE NEXT DUE AND PAYABLE BY TENANT UNDER
THIS
SECTION UNTIL SUCH AMOUNT SHALL HAVE BEEN REFUNDED TO TENANT IN
FULL. ANY
EXCESS PAYMENTS MADE BY TENANT DURING THE TERM THAT HAVE NOT BEEN
SO
APPLIED AND OUTSTANDING AT THE END OF THE TERM SHALL BE PAID TO
TENANT
PROMPTLY FOLLOWING LANDLORD'S FINAL ACCOUNTING FOR THE FINAL
CALENDAR YEAR
OF
THE TERM. ANY DELAY OR FAILURE OF LANDLORD IN BILLING ANY
ADDITIONAL
RENT
AS PROVIDED HEREIN SHALL NOT CONSTITUTE A WAIVER OF OR IN ANY
WAY
IMPAIR THE CONTINUING OBLIGATION OF TENANT TO PAY SUCH RENT
ADJUSTMENTS
HEREUNDER.
5.2.2 Common Operating Expenses. Tenant shall pay Tenant's
Common
Share of Common Operating Expenses monthly in advance beginning on
the
Commencement Date and continuing on the first day of each calendar
month
throughout the Term. Landlord may require that Tenant pay Tenant's
Common
Share of Common Operating Expenses based on Landlord's written
estimate
thereof delivered to Tenant from time to time, and upon Tenant's
receipt of
any
such notice from Landlord, the amount of such monthly
installment
payments shall change consistent with landlord's written estimate.
Within a
reasonable time after the end of each calendar year, Landlord shall
furnish
to
Tenant a notice as to whether the estimated payments paid by Tenant
were
more
or less than actually Common Operating Expenses. Within fifteen
(15)
days
following delivery of a Landlord's Statement, together with any
reasonable supporting documentation including copies of tax bills,
Tenant
shall pay to Landlord the amount of any underpayment of Common
Operating
Expenses. In the event that Tenant's payments exceed its liability
for
Common Operating Expenses, any such overpayment shall be credited
against
the
monthly installments that are next due and payable by Tenant under
this
Section until such amount shall have been refunded to Tenant in
full. Any
excess payments made by Tenant during the Term that have not been
so
applied and outstanding at the end of the Term shall be paid to
Tenant
promptly following Landlord's final accounting for the final
calendar year
of
the Term. Any delay or failure of Landlord in billing any
Additional
Rent
as provided herein shall not constitute a waiver of
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or
in any way impair the continuing obligation of Tenant to pay such
rent
adjustments hereunder.
5.3 Utilities. TENANT, AT ITS COST AND EXPENSE, SHALL CONTRACT
DIRECTLY WITH THE APPLICABLE UTILITY COMPANIES FOR ALL UTILITIES
SEPARATELY
SERVING THE PREMISES, INCLUDING, WITHOUT LIMITING THE GENERALITY OF
THE
FOREGOING, HEAT, AIR CONDITIONING, TELEPHONE, WATER GAS AND
ELECTRICITY AND
SHALL EXECUTE ALL AGREEMENTS AND PAY ALL UTILITY DEPOSITS NECESSARY
TO
OBTAIN THE UTILITY SERVICE IN TENANT'S NAME AND, IN THE CASE OF
ELECTRICITY, TO CAUSE THE ELECTRIC UTILITY TO INSTALL THE
FACILITIES
NECESSARY TO BRING ELECTRIC SERVICE TO THE PREMISES. TENANT AGREES
TO PAY
ALL CHARGES FOR
UTILITIES CONSUMED ON OR AFTER THE COMMENCEMENT DATE AS AND
WHEN
DUE. LANDLORD SHALL HAVE NO OBLIGATION TO PROVIDE UTILITIES OR
EQUIPMENT OTHER THAN THE UTILITIES AND EQUIPMENT WHICH EXIST WITHIN
THE
PREMISES AS OF THE COMMENCEMENT DATE OF THIS LEASE, EXCEPT AS MAY
BE
REQUIRED TO PERFORM LANDLORD'S REPLACEMENT OBLIGATIONS. IN THE
EVENT TENANT
REQUIRES ADDITIONAL UTILITIES OR EQUIPMENT, THE INSTALLATION
AND
MAINTENANCE THEREOF SHALL BE TENANT'S SOLE EXPENSE AND OBLIGATION,
PROVIDED
THAT
SUCH INSTALLATION SHALL BE SUBJECT TO THE PRIOR WRITTEN CONSENT OF
THE
LANDLORD. THERE SHALL BE NO ABATEMENT OF RENT AND LANDLORD SHALL
NOT BE
LIABLE IN ANY RESPECT WHATSOEVER FOR THE INADEQUACY, STOPPAGE,
INTERRUPTION, OR DISCONTINUANCE OF ANY UTILITY OR SERVICE DUE TO
ANY "FORCE
MAJEURE" (AS DEFINED IN SECTION 16.16 HEREOF) OR OTHER CAUSE
BEYOND
LANDLORD'S CONTROL.
5.4
Landlord's Statements and Tenant's Inspection Rights.
5.4.1 LANDLORD'S STATEMENTS. LANDLORD WILL DELIVER LANDLORD'S
STATEMENTS TO TENANT DURING THE TERM, BUT LANDLORD'S DELAY OR
FAILURE TO
RENDER LANDLORD'S STATEMENT WITH RESPECT TO ANY BUILDING OPERATING
EXPENSES
OR
COMMON OPERATING EXPENSES BEYOND A DATE SPECIFIED HEREIN SHALL
NOT
PREJUDICE LANDLORD'S RIGHT TO RENDER A LANDLORD'S STATEMENT WITH
RESPECT TO
THE
BUILDING OPERATING EXPENSES AND THE COMMON OPERATING EXPENSES OR
ANY
SUBSEQUENT BUILDING OPERATING EXPENSES AND COMMON OPERATING
EXPENSES. THE
OBLIGATIONS OF LANDLORD AND TENANT UNDER THE PROVISIONS OF THIS
ARTICLE
WITH
RESPECT TO ANY ADDITIONAL RENT INCURRED DURING THE TERM SHALL
SURVIVE
THE
EXPIRATION OR ANY SOONER TERMINATION OF THE TERM. IF LANDLORD FAILS
TO
GIVE
TENANT A STATEMENT OF PROJECTED BUILDING OPERATING EXPENSES AND
COMMON
OPERATING EXPENSES PRIOR TO THE COMMENCEMENT OF ANY CALENDAR YEAR,
TENANT
SHALL CONTINUE TO PAY BUILDING OPERATING EXPENSES AND COMMON
OPERATING
EXPENSES IN ACCORDANCE WITH THE PREVIOUS STATEMENT, UNTIL TENANT
RECEIVES A
NEW
STATEMENT FROM LANDLORD.
5.4.2 TENANT RIGHT TO AUDIT. DURING THE SIXTY (60)-DAY PERIOD
AFTER
RECEIPT OF ANY LANDLORD'S STATEMENT (THE "Review Period"), TENANT
MAY
INSPECT AND AUDIT LANDLORD'S RECORDS RELEVANT TO THE COST AND
EXPENSE ITEMS
REFLECTED IN SUCH LANDLORD'S STATEMENT AT A REASONABLE TIME
MUTUALLY
AGREEABLE TO LANDLORD AND TENANT DURING LANDLORD'S USUAL BUSINESS
HOURS.
EACH
LANDLORD'S STATEMENT SHALL BE CONCLUSIVE AND BINDING UPON
TENANT
UNLESS WITHIN NINETY (90) DAYS AFTER RECEIPT OF SUCH LANDLORD'S
STATEMENT
TENANT SHALL NOTIFY LANDLORD THAT IT DISPUTES THE CORRECTNESS OF
LANDLORD'S
STATEMENT, SPECIFYING THE RESPECTS IN WHICH LANDLORD'S STATEMENT IS
CLAIMED
TO
BE INCORRECT. IF, AFTER SUCH INSPECTION, TENANT DISPUTES THE AMOUNT
OF
BUILDING OPERATING EXPENSES OR COMMON OPERATING EXPENSES PAYABLE BY
UNDER
THIS
ARTICLE 5, TENANT SHALL BE ENTITLED TO RETAIN AN INDEPENDENT
COMPANY
OR
CERTIFIED PUBLIC ACCOUNTANT REASONABLY ACCEPTABLE TO LANDLORD TO
REVIEW
LANDLORD'S RECORDS TO DETERMINE THE PROPER AMOUNT OF SUCH
ADDITIONAL RENT.
IF
SUCH AUDIT OR REVIEW REVEALS THAT LANDLORD HAS OVERCHARGED TENANT,
THEN
WITHIN FIFTEEN (15) DAYS AFTER THE RESULTS OF SUCH AUDIT ARE MADE
AVAILABLE
TO
LANDLORD, LANDLORD SHALL REIMBURSE TENANT THE AMOUNT OF SUCH
OVERCHARGE
PLUS
INTEREST AT THE REFERENCE OR PRIME RATE IN EFFECT FROM TIME TO TIME
AT
CITIBANK, OR ITS SUCCESSOR (AND, IN THE ABSENCE THEREOF, AT THE
PRIME RATE
PUBLISHED IN THE WALL STREET
14
<PAGE>
JOURNAL), FROM THE DATE OF OVERPAYMENT (THE "Prime Rate"). IF THE
AUDIT
REVEALS THAT TENANT WAS UNDERCHARGED, THEN WITHIN FIFTEEN (15) 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
PRIME RATE. IF LANDLORD DESIRES TO CONTEST SUCH AUDIT RESULTS,
LANDLORD
MAY
DO SO BY SUBMITTING THE RESULTS OF THE AUDIT TO ARBITRATION
PURSUANT TO
SECTION 13.8 OF THE LEASE WITHIN SIXTY (60) DAYS OF RECEIPT OF THE
RESULTS
OF
THE AUDIT, AND THE ARBITRATION SHALL BE FINAL AND BINDING UPON
LANDLORD
AND
TENANT. TENANT AGREES TO PAY THE COST OF SUCH AUDIT, PROVIDED THAT,
IF
THE
AUDIT REVEALS THAT LANDLORD'S DETERMINATION OF SUCH ADDITIONAL RENT
AS
SET
FORTH IN ANY STATEMENT SENT TO TENANT WAS IN ERROR IN LANDLORD'S
FAVOR
BY
MORE THAN FIVE PERCENT (5%), LANDLORD SHALL PAY THE REASONABLE COST
OF
SUCH
AUDIT. PENDING THE DETERMINATION OF SUCH DISPUTE AS HEREINAFTER
PROVIDED, TENANT SHALL PAY ADDITIONAL RENT IN ACCORDANCE WITH
THE
APPLICABLE LANDLORD'S STATEMENT, AND SUCH PAYMENT SHALL BE
WITHOUT
PREJUDICE TO TENANT'S POSITION. ALL INSPECTIONS AND AUDITS OF
LANDLORD'S
BOOKS AND RECORDS AND ANY ARBITRATION SHALL BE SUBJECT TO A
CONFIDENTIALITY
AGREEMENT REASONABLY ACCEPTABLE TO LANDLORD.
5.5
Additional Rent Adjustments. IF THE TERM SHALL EXPIRE ON A DATE
OTHER
THAN DECEMBER 31ST, ANY ADDITIONAL RENT FOR THE LEASE YEAR IN WHICH
THE
EXPIRATION DATE SHALL OCCUR SHALL BE APPORTIONED (BASED UPON THE
IMMEDIATELY
PRECEDING TWELVE (12)-MONTH PERIOD) IN THAT PERCENTAGE WHICH THE
NUMBER OF DAYS
IN THE PERIOD FROM JANUARY 1ST OF SUCH LEASE YEAR TO SUCH DATE OF
EXPIRATION,
BOTH INCLUSIVE, SHALL BEAR TO THE TOTAL NUMBER OF DAYS IN THE
CALENDAR YEAR IN
WHICH SUCH EXPIRATION OCCURS.
5.6
COMMON OPERATING EXPENSES FOLLOWING TRANSITION DATE.
5.6.1 Landlord's Additional Services. Upon the occurrence of a
Transition Event, Landlord shall provide the following services to
the
Building under Section 6.1 hereof (and Tenant shall cease providing
such
services and co-operate with Landlord and its contractors with
respect to
the
transition of such service providers): (a) repair and maintenance
(but
not
replacement) of (a) the exterior walls (excluding the exterior
windows,
doors and related hardware) and (b) the storm water system.
Notwithstanding
the
agreement of the parties herein with respect to Landlord's
services
with
respect to the Building, Landlord acknowledges that Landlord's
obligations with respect to any New Building shall also include
the
maintenance, repair and replacement of the following structural
components
of
the New Building: (i) footings and foundation, (ii) structural
columns
and
interior bearing walls, (iii) exterior walls (excluding doors
and
windows), and (iv) the roof structure (excluding the roofing
membrane).
5.6.2 Additional Operating Expenses. Upon the occurrence of a
Transition Event, the following costs and expenses shall be
included within
the
definition of Operating Expenses and subject to payment by Tenant
as
Additional Rent:
(a) MAINTENANCE AND REPAIR (EXCLUDING REPLACEMENTS) OF (I)
EXTERIOR
WALLS (EXCLUDING EXTERIOR WINDOWS AND DOORS AND RELATED HARDWARE)
OF THE
BUILDING; AND (II) THE PROPERTY'S STORM WATER SYSTEM;
(b) Fees for management services whether rendered by Landlord
(or
affiliate) or a third-party property manager in an amount equal to
three
percent (3%) of the Rent in each Lease Year.
ARTICLE 6 SERVICES AND UTILITIES
6.1
Services. LANDLORD SHALL PROVIDE THE FOLLOWING SERVICES TO THE
BUILDING
AND PROPERTY (SUBJECT TO TENANT'S REIMBURSEMENT AND PAYMENT
OBLIGATIONS THEREFOR
IN ACCORDANCE WITH THE OPERATION OF ARTICLE 5 HEREOF) AND SUBJECT
TO TENANT'S
COMPLETION OF THE "Tenant Roof Repairs" (AS DEFINED IN SECTION
8.2.5 HEREOF) AND
THE "Tenant Paving Repairs" (AS DEFINED IN SECTION 8.2.6
HEREOF):
15
<PAGE>
(a) MAINTENANCE AND REPAIR (INCLUDING REPLACEMENTS) OF THE
BUILDING'S
EXISTING BASE BUILDING ROOF-TOP HVAC UNITS (AND RELATED MAJOR
COMPONENT
EQUIPMENT) IDENTIFIED IN EXHIBIT H ATTACHED HERETO AS THE "BASE
BUILDING
HVAC
UNITS", BUT EXCLUDING ANY SPECIALTY UNITS THAT ARE USED IN
TENANT'S
ASSEMBLY OR MANUFACTURING PROCESSES;
(b) MAINTENANCE AND REPAIR (INCLUDING REPLACEMENTS) OF (I) THE
BUILDING'S ROOFING AND FLASHING (EXCLUDING ANY OF THE ROOF'S
STRUCTURAL
COMPONENTS), AND (II) THE ASPHALT PAVED PARKING AREAS AND
DRIVEWAYS;
(c) Landscaping and grounds maintenance, including lawn mowing,
tree
pruning, annual flower planting, snow plowing and sweeping of the
parking
lot;
and the maintenance and repair (but not replacement) of any
existing
irrigation system; and
(d) Maintenance of the insurance coverages described in Sections
5.1
and
9.7.
The manner in which Landlord provides the services described in
Section 6.1,
including the manner in which the Common Areas are maintained and
operated and
the expenditures therefor shall be at the sole commercially
reasonable
discretion of Landlord and in accordance with the standards of
comparable
office/industrial buildings in New Haven County - Shoreline Area
(Branford,
Guilford, East Haven, New Haven, West Haven and Milford) (the "NEW
HAVEN COUNTY
SHORELINE AREA"). Landlord shall have the right to approve the
utility providers
at the Building, which approval shall not be unreasonably withheld,
and Tenant
shall pay all actual costs associated with all utility services as
provided in
Section 5.3 hereof. Landlord's failure to furnish any of such
services when such
failure is caused by accidents, the making of repairs, alterations
or
improvements, labor difficulties, difficulty in obtaining adequate
service or
supplies from the sources from which they are usually obtained for
the Building,
or governmental constraints or any other cause beyond Landlord's
reasonable
control, shall not result in any liability to Landlord. Tenant
shall not be
entitled to any abatement or reduction of rent by reason of such
failure, and
Tenant shall not be relieved from the performance of any covenant
or agreement
in this Lease.
6.2
Additional Services. LANDLORD SHALL IMPOSE REASONABLE CHARGES AND
MAY
ESTABLISH REASONABLE RULES AND REGULATIONS WITH RESPECT TO ANY
ADDITIONAL
SERVICES THAT ARE REQUESTED AND WHICH LANDLORD AGREES TO SUPPLY TO
THE PREMISES.
6.3
Excessive Current. TENANT SHALL COMPLY WITH THE CONNECTED
ELECTRICAL
LOAD REASONABLY ESTABLISHED BY LANDLORD FOR THE BUILDING. TENANT
AGREES THAT AT
ALL TIMES ITS USE OF ELECTRIC CURRENT SHALL NEVER EXCEED THE
CAPACITY OF THE
FEEDERS TO THE PREMISES OR THE RISERS OR WIRING INSTALLED THEREON.
TENANT SHALL
NOT, CONNECT ANY EQUIPMENT, TO THE BUILDING'S ELECTRICAL SYSTEM
THAT WOULD
REQUIRE ELECTRICAL ENERGY IN THE PREMISES IN EXCESS OF THE CAPACITY
OF THE
EXISTING FEEDERS OR WIRING INSTALLATIONS THEN SERVING THE PREMISES.
TENANT ALSO
AGREES TO SUPPLY AND REPLACE ALL LAMPS, BULBS, BALLASTS AND
STARTERS USED IN THE
PREMISES. TENANT SHALL NOT, WITHOUT PRIOR CONSENT OF LANDLORD IN
EACH INSTANCE,
MAKE OR PERFORM, OR PERMIT THE MAKING OR PERFORMING OF, ANY
ALTERATION TO WIRING
INSTALLATIONS OR OTHER ELECTRICAL FACILITIES IN OR SERVING THE
BUILDING OR ANY
ADDITIONS TO THE ELECTRICAL FIXTURES, MACHINES, EQUIPMENT OR OTHER
APPLIANCES AT
THE BUILDING WHICH UTILIZE ELECTRICAL ENERGY.
6.4
Maintenance of Common Areas. EXCEPT AS OTHERWISE STATED HEREIN,
LANDLORD RESERVES THE RIGHT FROM TIME TO TIME TO (A) MAKE CHANGES
IN THE SHAPE,
SIZE, LOCATION AND APPEARANCE OF THE LAND AND IMPROVEMENTS WHICH
CONSTITUTE THE
COMMON AREAS, PROVIDED THAT LANDLORD SHALL NOT MATERIALLY IMPAIR
THE TENANT'S
ABILITY TO OPERATE ITS BUSINESS, EXCEPT TEMPORARY IMPAIRMENTS
REQUIRED BY SAID
CHANGES; (B) MAKE SUCH IMPROVEMENTS, ALTERATIONS AND REPAIRS TO THE
COMMON AREAS
AS MAY BE REQUIRED BY GOVERNMENTAL AUTHORITIES OR BY UTILITY
COMPANIES SERVICING
THE BUILDING; (C) CONSTRUCT, MAINTAIN AND OPERATE LIGHTING AND
OTHER FACILITIES
ON ALL SAID AREAS AND IMPROVEMENTS; (D) GRANT EXCLUSIVE PARKING
RIGHTS TO
PROPERTY TENANTS; AND (E) TO ADD OR REMOVE IMPROVEMENTS AND
16
<PAGE>
FACILITIES TO OR FROM THE COMMON AREAS, PROVIDED THAT LANDLORD
SHALL NOT (I)
REDUCE THE AMOUNT OF TENANT'S PARKING SPACES NOR RELOCATE TENANT'S
EXCLUSIVE
SPACES OUTSIDE OF THE EXCLUSIVE PARKING AREA; NOT (II) UNREASONABLY
INTERFERE
WITH THE CONDUCT OF TENANT'S BUSINESS AT THE PREMISES INCLUDING
ACCESS TO AND
EGRESS FROM THE PREMISES, PARKING AREA AND THE PROPERTY. THE USE OF
THE COMMON
AREAS SHALL BE SUBJECT TO SUCH REASONABLE REGULATIONS AND CHANGES
THEREIN AS
LANDLORD SHALL MAKE FROM TIME TO TIME, INCLUDING (BUT NOT BY WAY OF
LIMITATION)
THE RIGHT TO CLOSE FROM TIME TO TIME, IF NECESSARY, ALL OR ANY
PORTION OF THE
COMMON AREAS TO SUCH EXTENT AS MAY BE LEGALLY SUFFICIENT, IN THE
REASONABLE
OPINION OF LANDLORD'S COUNSEL, TO PREVENT A DEDICATION THEREOF OR
THE ACCRUAL OF
RIGHTS OF ANY PERSON OR OF THE PUBLIC THEREIN; PROVIDED, HOWEVER,
LANDLORD SHALL
DO SO AT SUCH TIMES AND IN SUCH MANNER AS SHALL MINIMIZE ANY
DISRUPTION TO
TENANT TO THE EXTENT REASONABLY POSSIBLE, AND PROVIDED LANDLORD
SHALL NOT (I)
REDUCE THE AMOUNT OF TENANT'S PARKING SPACES NOR RELOCATE TENANT'S
EXCLUSIVE
SPACES OUTSIDE OF THE EXCLUSIVE PARKING AREA; NOR (II) UNREASONABLY
INTERFERE
WITH THE CONDUCT OF TENANT'S BUSINESS AT THE PREMISES INCLUDING
ACCESS TO AND
EGRESS FROM THE PREMISES, PARKING AREA AND THE PROPERTY.
6.5
Access to Premises.
6.5.1 RIGHT OF ENTRY. LANDLORD SHALL HAVE THE RIGHT TO ENTER
THE
PREMISES WITHOUT ABATEMENT OF RENT AT ALL REASONABLE TIMES UPON
REASONABLE
PRIOR NOTICE TO TENANT (EXCEPT IN EMERGENCIES WHEN NO ADVANCE
NOTICE SHALL
BE
REQUIRED), (A) TO SUPPLY ANY SERVICE TO BE PROVIDED BY LANDLORD
TO
TENANT HEREUNDER, (B) TO SHOW THE PREMISES TO LANDLORD'S MORTGAGEE
AND TO
PROSPECTIVE PURCHASERS, MORTGAGEES AND TO TENANTS IN LAST TWELVE
(12)
MONTHS OF TERM, (C) TO INSPECT, ALTER, IMPROVE OR REPAIR THE
PREMISES AND
ANY
PORTION OF THE BUILDING, AND (D) TO INTRODUCE CONDUITS, RISERS,
PIPES
AND
DUCTS TO AND THROUGH THE PREMISES, PROVIDED THAT IN EXERCISING ANY
SUCH
RIGHT, LANDLORD WILL CAUSE ALL SUCH CONDUITS, RISERS, PIPES AND
DUCTS TO BE
PLACED ABOVE DROPPED CEILINGS, WITHIN WALLS, OR BELOW FLOORS OR IN
CLOSETS,
TO
THE EXTENT REASONABLY PRACTICABLE. IN CONDUCTING ANY SUCH
ACTIVITIES,
LANDLORD SHALL USE REASONABLE EFFORTS NOT TO DISRUPT THE CONDUCT
OF
TENANT'S BUSINESS OPERATIONS.
6.5.2 KEYS. FOR EACH OF THE PURPOSES STATED ABOVE IN THIS SECTION
6.5,
LANDLORD SHALL AT ALL TIMES HAVE AND RETAIN A KEY (OR AN ELECTRONIC
ACCESS
CARD
FOR TENANT'S SECURITY SYSTEM) WITH WHICH TO UNLOCK ALL OF THE
DOORS
IN,
UPON AND ABOUT THE PREMISES, EXCLUDING TENANT'S VAULTS AND SAFES,
OR
SPECIAL SECURITY AREAS. LANDLORD SHALL HAVE THE RIGHT TO USE ANY
AND ALL
MEANS THAT LANDLORD MAY DEEM NECESSARY OR PROPER TO OPEN SAID DOORS
IN AN
EMERGENCY, IN ORDER TO OBTAIN ENTRY TO ANY PORTION OF THE
PREMISES.
LANDLORD AND ITS AGENTS AND REPRESENTATIVES SHALL HAVE THE RIGHT TO
ENTER
UPON
THE PREMISES FOR ANY AND ALL OF THE PURPOSES SET FORTH IN THIS
ARTICLE.
ARTICLE 7 CONDUCT OF BUSINESS BY TENANT
7.1
Tenant's Business Operations.
7.1.1 PERMITTED USES. THE PREMISES SHALL BE USED AND OCCUPIED
FOR
GENERAL OFFICE, WAREHOUSE AND "LIGHT" MANUFACTURING AND ASSEMBLY
PURPOSES
ONLY. TENANT SHALL NOT USE OR OCCUPY, OR PERMIT THE USE OR
OCCUPANCY OF,
THE
PREMISES OR ANY PART THEREOF FOR ANY USE OTHER THAN THE SOLE
USE
SPECIFICALLY SET FORTH ABOVE OR IN ANY ILLEGAL MANNER, OR IN ANY
MANNER
THAT, IN LANDLORD'S REASONABLE JUDGMENT, WOULD ADVERSELY AFFECT
OR
INTERFERE WITH ANY SERVICES REQUIRED TO BE FURNISHED BY LANDLORD TO
TENANT
OR
TO ANY OTHER TENANT OR OCCUPANT OF THE BUILDING, OR WITH THE USE
AND
ENJOYMENT OF ANY PART OF THE BUILDING BY ANY OTHER TENANT OR
OCCUPANT.
TENANT AGREES THAT IT
WILL NOT EXCEED THE MAXIMUM FLOOR-BEARING CAPACITY
FOR
THE PREMISES.
17
<PAGE>
7.1.2 Prohibited Actions; Disclosures. Tenant shall not commit
or
suffer to be committed, any waste upon the Premises or the
Property, or any
public or private nuisance or other act or thing which may disturb
the
quiet enjoyment of any other tenant at the Property. Tenant agrees
at all
times to cause the Premises to be operated in compliance with
all
"Applicable Laws" (defined below in Section 7.3), including but not
limited
to
those relating to zoning, environmental protection, health, and
safety.
Tenant further agrees to promptly cure any such violation at its
own
expense, and shall furthermore defend and indemnify Landlord, and
its
mortgagees, and officers, agents, and employees thereof
respectively, for
any
and all liability, loss, costs (including reasonable attorneys'
fees
and
reasonable expenses), damages, responsibilities or obligations
incurred
as a
result of any violation of any of the foregoing, except to the
extent
caused by Landlord, its agents', employees' or contractors' breach
of this
Lease, gross negligence or willful misconduct. At the request of
the
Landlord, Tenant shall submit to the Landlord, or shall make
available for
inspection and copying upon reasonable notice and at reasonable
times, any
or
all of the documents and materials prepared by or for Tenant
pursuant to
any
environmental law or regulation or submitted to any
governmental
regulatory agency in conjunction therewith.
7.2
Tenant's Personal Property. TENANT SHALL BE RESPONSIBLE FOR ANY
AD
VALOREM TAXES ON ITS PERSONAL PROPERTY (WHETHER OWNED OR LEASED)
AND ON THE
VALUE OF ITS LEASEHOLD IMPROVEMENTS IN THE PREMISES (WHICH ARE IN
EXCESS OF
BUILDING STANDARD IMPROVEMENTS), AND IF THE TAXING AUTHORITIES DO
NOT SEPARATELY
ASSESS TENANT'S LEASEHOLD IMPROVEMENTS, LANDLORD MAY MAKE A
REASONABLE
ALLOCATION OF THE IMPOSITIONS TO SUCH IMPROVEMENTS AND CHARGE
TENANT FOR THE
SAME AS ADDITIONAL RENT.
7.3
Compliance with Laws. TENANT, AT TENANT'S EXPENSE, SHALL COMPLY
PROMPTLY WITH THE LAWS, ORDINANCES, RULES, REGULATIONS AND ORDERS
OF ALL
GOVERNMENTAL AUTHORITIES IN EFFECT FROM TIME TO TIME DURING THE
TERM INCLUDING,
WITHOUT LIMITATION, THE AMERICANS WITH DISABILITIES ACT ("ADA"),
AND ALL
APPLICABLE FEDERAL, STATE AND MUNICIPAL BUILDING, ZONING, FIRE,
HEALTH, SAFETY
AND ENVIRONMENTAL LAWS (COLLECTIVELY THE "Applicable Laws") THAT
SHALL IMPOSE
ANY DUTY ON TENANT WITH RESPECT TO THE PREMISES, BUILDING AND
COMMON AREAS OR
THE USE, OCCUPANCY OR OPERATION THEREOF. TENANT SHALL BE
RESPONSIBLE FOR LEGAL
COMPLIANCE, INCLUDING THE REQUIREMENTS OF THE ADA, WITH RESPECT TO
(A) ANY AND
ALL REQUIREMENTS ON ACCOUNT OF TENANT'S USE OF, OR OPERATIONS IN,
THE PREMISES,
AND (B) ALL ALTERATIONS DESIGNED OR CONSTRUCTED BY TENANT OR ITS
CONTRACTORS OR
AGENTS THAT AFFECT THE PREMISES OR THE EXISTING BUILDING. TENANT
WILL OBTAIN AND
MAINTAIN IN FULL FORCE AND EFFECT ANY AND ALL LICENSES AND PERMITS
NECESSARY FOR
ITS USE. TENANT SHALL MAKE ANY ALTERATIONS IN OR TO THE PREMISES,
BUILDING AND
COMMON AREAS IN ORDER TO COMPLY WITH THE FOREGOING, WHICH ARE
NECESSITATED OR
OCCASIONED, IN WHOLE OR IN PART BY THE USE OR OCCUPANCY OR MANNER
OF USE,
OCCUPANCY OR OPERATION OF THE PREMISES BY TENANT OR ANY OF ITS
OFFICERS,
EMPLOYEES, AGENTS, CONTRACTORS, INVITEES, LICENSEES OR SUBTENANTS
(THE "Tenant
Parties").
7.4
Landlord's Rules and Regulations. TENANT SHALL FAITHFULLY OBSERVE
AND
COMPLY WITH THE RULES AND REGULATIONS ATTACHED TO THIS LEASE AS
EXHIBITS C-1 AND
C-2, AND ALL REASONABLE MODIFICATIONS THEREOF AND ADDITIONS THERETO
FROM TIME TO
TIME PUT INTO EFFECT BY LANDLORD (THE "Rules and Regulations").
TENANT SHALL NOT
USE OR PERMIT THE USE OF THE PREMISES IN ANY MANNER THAT WILL TEND
TO CREATE
WASTE OR A NUISANCE, OR WHICH SHALL TEND TO UNREASONABLY DISTURB
OTHER TENANTS
OF THE BUILDING. LANDLORD SHALL NOT BE RESPONSIBLE TO TENANT FOR
THE
NONPERFORMANCE OF ANY OF THE RULES AND REGULATIONS BY ANY OTHER
TENANTS OR
OCCUPANTS OF THE PROPERTY. LANDLORD SHALL USE REASONABLE EFFORTS TO
ENFORCE THE
RULES AND REGULATIONS IN A FAIR AND NON-DISCRIMINATORY MANNER. IN
THE EVENT OF
AN EXPRESS AND DIRECT CONFLICT BETWEEN THE TERMS, COVENANTS,
AGREEMENTS AND
CONDITIONS OF THIS LEASE AND THE TERMS, COVENANTS, AGREEMENTS AND
CONDITIONS OF
SUCH RULES AND REGULATIONS, AS MODIFIED AND AMENDED FROM TIME TO
TIME BY
LANDLORD, THIS LEASE SHALL CONTROL.
18
<PAGE>
7.5
No Liens. TENANT SHALL KEEP THE PREMISES AND PROPERTY FREE FROM
ANY
LIENS OR ENCUMBRANCES ARISING OUT OF ANY WORK PERFORMED, MATERIAL
FURNISHED OR
OBLIGATIONS INCURRED BY OR FOR TENANT OR ANY PERSON OR ENTITY
CLAIMING THROUGH
OR UNDER TENANT. ANY CLAIM TO, OR LIEN UPON, THE PREMISES OR THE
BUILDING
ARISING FROM ANY ACT OR OMISSION OF TENANT SHALL ACCRUE ONLY
AGAINST THE
LEASEHOLD ESTATE OF TENANT AND SHALL BE SUBJECT AND SUBORDINATE TO
THE PARAMOUNT
TITLE AND RIGHTS OF LANDLORD IN AND TO THE PREMISES AND THE
PROPERTY. IF ANY
MECHANICS' OR OTHER LIEN SHALL BE FILED AGAINST THE PREMISES OR THE
PROPERTY
PURPORTING TO BE FOR LABOR OR MATERIAL FURNISHED OR TO BE FURNISHED
AT THE
REQUEST OF THE TENANT, THEN TENANT SHALL AT ITS EXPENSE CAUSE SUCH
LIEN TO BE
DISCHARGED OF RECORD BY PAYMENT, BOND OR OTHERWISE, WITHIN THIRTY
(30) DAYS
AFTER THE FILING THEREOF.
7.6
Environmental Compliance.
7.6.1 DEFINED TERMS. AS USED IN THIS LEASE, THE FOLLOWING TERMS
SHALL
HAVE
THE FOLLOWING MEANINGS:
(a) "HAZARDOUS SUBSTANCES" shall mean (i) any substance that is
defined, listed or otherwise classified as a pollutant, toxic
substance, hazardous substance, hazardous waste, hazardous
material
extremely hazardous waste, or words of similar meaning or
regulatory
effect under any Environmental Laws, including without
limitation,
"Hazardous Waste" as defined by the federal Resource Conservation
and
Recovery Act ("RCRA"), 42 U.S.C. ss.6901 et seq. and
regulations
promulgated thereunder; and "Hazardous Substance" as defined by
the
federal Comprehensive Environmental Response, Compensation and
Liability Act ("CERCLA") 42 U.S.C. ss.9601 et seq. and
regulations
promulgated thereunder; and (ii) any substance that may, if not
properly used, handled, managed, stored, or disposed of,
pollute,
contaminate, harm or have any detrimental effect on human health
or
the environment; including, but not limited to, petroleum and
petroleum products, asbestos and asbestos-containing materials,
polychlorinated biphenyls, lead, radon, radioactive materials,
flammables, explosives and toxic mold.
(b) "ENVIRONMENTAL LAW(S)" shall mean (i) any one or more (as
the
context may require) federal, state or local law or regulation,
effective during the Term and during any period following the
Term
during which any Tenant indemnity or other obligation survives
as
provided in this Lease, relating to the handling, use, control,
management, treatment, storage, disposal, release or threat of
release
of any Hazardous Substance, including without limitation,
CERCLA,
RCRA, the federal Water Pollution Control Act ("CWA"), 33
U.S.C.
ss.1251 et seq., the federal Clean Air Act ("CAA"), 42 U.S.C.
ss.ss.
7401 et seq., the Toxic Substances Control Act ("TSCA"), 7 U.S.C.
ss.
136 et seq., the Safe Drinking Water Act ("SDWA"), 42 U.S.C. ss.
300f
et seq., the Occupation Safety and Health Act of 1970 (the "OSH
ACT"),
29 U.S.C. ss. 651 et seq., the Rivers and Harbors Act of 1970,
as
amended, 33 U.S.C. 401 ss. et seq., and any similar state or
local
laws, rules or regulations; and/or (ii) any and all
requirements
arising under applicable federal, state or local laws,
statutes,
rules, ordinances, codes, common law, licenses, permits,
approvals,
plans, authorizations, and all applicable judicial,
administrative,
and regulatory decrees, judgments, and orders, effective during
the
Term and during any period following the Term during which any
Tenant
indemnity or other obligation survives as provided in this
Lease,
relating to the protection of human health or the environment,
including without limitation any and all requirements pertaining
to
reporting, licensing, authorizing, approving, permitting,
investigating, and remediating emissions, discharges, releases,
or
threat of releases of any Hazardous Substances into the indoor
or
outdoor air, surface water, groundwater, or land, or otherwise
into
the environment, or relating to the manufacture, operation,
processing, distribution,
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use, treatment, storage, disposal, transport, handling or
management
of any Hazardous Substance and any and all requirements pertaining
to
the protection of the health and safety of employees or the
public
and/or the environment.
(c)
"RELEASE" shall mean any release, deposit, discharge,
emission, leaking, leaching, spilling, seeping, migrating,
injecting,
pumping, pouring, emptying, dumping, disposing, generating,
storing
(including storing in above ground or underground storage tanks)
or
other movement of Hazardous Substances into the environment on,
from,
under, or within the Premises or Property, or transportation of
Hazardous Substances to or from the Premises or Property,
including
continuing migration of Hazardous Substances into or through
soil,
surface water or groundwater. "THREATENED RELEASE" shall mean a
condition which, if not altered or mitigated, would be likely
to
result in a Release.
(d) "GOVERNMENTAL AUTHORITY" shall mean the Federal government,
or any state or other political subdivision thereof, or any
agency,
court or body of the Federal government, any state or other
political
subdivision thereof, exercising executive, legislative,
judicial,
regulatory or administrative functions over the Premises or
Property.
7.6.2 HAZARDOUS SUBSTANCES. TENANT SHALL NOT GENERATE, STORE,
DISPOSE
OF
OR RELEASE, OR PERMIT THE STORAGE, USE, DISPOSAL OR RELEASE OF,
ANY
HAZARDOUS SUBSTANCES, IN, ABOVE, ON OR UNDER THE PREMISES OR THE
PROPERTY
(EXCEPT AS EXPRESSLY AUTHORIZED BELOW AND FURTHER EXCEPT FOR
CUSTOMARY
SUPPLIES MAINTAINED IN AMOUNTS AND IN A MANNER CONSISTENT WITH
REASONABLE
COMMERCIAL OFFICE PRACTICES IF STORED, USED AND DISPOSED OF, IN
ACCORDANCE
WITH
ALL APPLICABLE LAWS AND FIRE PROTECTION REQUIREMENTS OF ANY
BUILDING
INSURERS RELATING THERETO). TENANT SHALL REMOVE, CLEAN-UP AND
REMEDIATE ANY
HAZARDOUS SUBSTANCE ON THE PREMISES IN ACCORDANCE WITH APPLICABLE
LAWS,
PROVIDED THAT THE PRESENCE OF SUCH HAZARDOUS SUBSTANCE RESULTED
FROM THE
ACTION OR INACTION OF TENANT OR ANY TENANT PARTIES. TENANT IS
AUTHORIZED TO
STORE, USE AND DISPOSE OF HAZARDOUS SUBSTANCES ONLY AS REQUIRED FOR
THE
MANUFACTURING, SERVICING AND REPAIR OF MEDICAL PRODUCTS
MANUFACTURED BY
TENANT CONSISTENT WITH THE USES EXPRESSLY PERMITTED UNDER SECTION
7.1
HEREOF, SUBJECT TO TENANT'S OBLIGATION (A) TO STORE, USE AND
DISPOSE OF ANY
SUCH
HAZARDOUS SUBSTANCES IN ACCORDANCE WITH THE ENVIRONMENTAL LAWS AND
THE
OTHER TERMS, CONDITIONS AND COVENANTS OF THIS LEASE AND (B) NOT TO
GENERATE
MONTHLY QUANTITIES OF HAZARDOUS WASTE (AS THAT TERM IS DEFINED IN
RCRA AND
THE
CONNECTICUT STATUTE) WHICH WOULD CAUSE THE PROPERTY (OR ANY
PART
THEREOF) TO CONSTITUTE AN "ESTABLISHMENT" (AS DEFINED IN THE
CONNECTICUT
TRANSFER ACT, C.G.S. SS. 22A-134).
7.6.3 CONNECTICUT TRANSFER ACT. NOTWITHSTANDING ANYTHING TO THE
CONTRARY IN THIS SECTION 7.6, TENANT SHALL NOT TAKE OR PERMIT ANY
ACTION
THAT
WOULD CAUSE THE PREMISES OR PROPERTY TO BECOME AN
"ESTABLISHMENT".
TENANT SHALL COOPERATE WITH LANDLORD IN SATISFYING ANY LEGAL
REQUIREMENTS
IMPOSED UPON LANDLORD RELATING TO TENANT'S OPERATIONS, AND, UPON
LANDLORD'S
WRITTEN REQUEST, SHALL FURNISH COMPLETE INFORMATION TO LANDLORD
WITH REGARD
TO
ITS OPERATIONS. IN CONNECTION WITH ANY "TRANSFER" (AS DEFINED IN
THE
CONNECTICUT TRANSFER ACT) SUBSEQUENT TO THE COMMENCEMENT DATE,
THAT
REQUIRES COMPLIANCE WITH THE CONNECTICUT TRANSFER ACT, INCLUDING
ANY
TRANSFER OF TENANT'S INTEREST IN THE LEASE OR TENANT'S BUSINESS
OPERATIONS,
OR
ANY TRANSFER BY LANDLORD OF THE PREMISES OR THE PROPERTY (OR ANY
PORTION
THEREOF), TENANT SHALL COMPLY WITH THE CONNECTICUT TRANSFER ACT
RELATIVE TO
ITS
OPERATIONS AT THE PREMISES, AND TENANT SHALL EXECUTE SUCH
TRANSFER
DOCUMENTS AND CERTIFICATES AS REASONABLY DETERMINED BY LANDLORD TO
BE
NECESSARY AS A RESULT OF TENANT'S BUSINESS OPERATIONS AND USE OF
THE
PREMISES IN THE EVENT OF ANY SUCH TRANSFER. IN THE EVENT THAT THE
TENANT
HAS
CAUSED THE PREMISES OR PROPERTY, IN
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<PAGE>
WHOLE OR IN PART, TO MEET THE DEFINITION OF AN ESTABLISHMENT
PURSUANT TO
THE
CONNECTICUT TRANSFER ACT, THEN THE TENANT SHALL (I) ACT AS THE
CERTIFYING PARTY IN ANY REQUIRED STATEMENT OR FILING UNLESS THE
CONNECTICUT
TRANSFER ACT REQUIRES ANOTHER PARTY TO DO SO; AND (II) IN ADDITION
TO THE
ENVIRONMENTAL INDEMNITY BY TENANT PROVIDED BELOW IN SECTION 7.6.9
HEREOF,
TENANT SHALL INDEMNIFY, DEFEND AND HOLD FULLY HARMLESS LANDLORD AND
ITS
GRANTEES AND SUCCESSORS IN INTEREST TO OWNERSHIP OF THE PREMISES
FROM AND
AGAINST ANY AND ALL LIABILITY, LOSS, SUITS, CLAIMS, ACTIONS, CAUSES
OF
ACTION, REMEDIATION ORDERS, PROCEEDINGS, DEMANDS, COSTS,
PENALTIES,
DAMAGES, FINES AND EXPENSES, INCLUDING, WITHOUT LIMITATION,
ATTORNEYS'
FEES, CONSULTANTS' FEES, LABORATORY FEES, REMEDIATION COSTS, AND
OTHER
COSTS WHICH MAY BE IMPOSED UPON, INCURRED BY OR ASSERTED OR AWARDED
AGAINST
LANDLORD AND ITS GRANTEES AND SUCCESSORS IN INTEREST TO OWNERSHIP
OF THE
PREMISES ARISING OUT OF OR ON ACCOUNT OF TENANT'S FAILURE TO
EXECUTE AND
DELIVER ANY SUCH TRANSFER DOCUMENTS AND CERTIFICATES AND ANY
INVESTIGATION,
REMEDIATION OR MONITORING NECESSARY TO COMPLY WITH THE CONNECTICUT
TRANSFER
ACT,
BUT ONLY TO THE EXTENT THAT SUCH COMPLIANCE WAS REQUIRED AS A
RESULT
OF
AN ACTION TAKEN OR PERMITTED BY TENANT OR ANY TENANT PARTIES THAT
CAUSED
THE
PREMISES TO BECOME AN "ESTABLISHMENT" AS DEFINED IN THE
CONNECTICUT
TRANSFER ACT.
7.6.4 NOTICE TO LANDLORD OF RELEASES AND OTHER CONDITIONS.
TENANT
SHALL IMMEDIATELY NOTIFY LANDLORD IF TENANT BECOMES AWARE OF (A) A
RELEASE
ON,
AT, OR IN THE PREMISES OR PROPERTY; (B) ANY LIEN, NOTICE OR ORDER
FROM
A
GOVERNMENTAL AUTHORITY OR OTHER PERSON ISSUED UNDER ANY
ENVIRONMENTAL
LAWS
AS A RESULT OF THE VIOLATION OR ALLEGED VIOLATION OF ANY
ENVIRONMENTAL
LAWS
BY TENANT OR ANY TENANT PARTIES; AND (C) ANY OCCURRENCE OR
CONDITION
ON
ANY REAL PROPERTY ADJOINING THE PROPERTY THAT COULD CAUSE THE
PROPERTY
OR
ANY PART THEREOF TO BE SUBJECT TO ANY DISCLOSURE REQUIREMENTS UNDER
ANY
ENVIRONMENTAL LAWS, (D) THE IMPOSITION OF ANY RESTRICTIONS ON
THE
OWNERSHIP, OCCUPANCY, TRANSFERABILITY OR USE OF THE PROPERTY UNDER
ANY
ENVIRONMENTAL LAWS, SUCH AS LIENS, INSTITUTIONAL CONTROLS OR
DEED
RESTRICTIONS. TENANT WILL PROMPTLY FORWARD TO LANDLORD COPIES OF
ANY
WRITTEN NOTICES FROM ANY SUCH GOVERNMENTAL AUTHORITY OR OTHER
PERSONS
RECEIVED BY TENANT RELATING TO ALLEGED VIOLATIONS OF ANY
ENVIRONMENTAL LAW.
TENANT WILL PROMPTLY PAY WHEN DUE ANY FINE OR ASSESSMENT PURSUANT
TO THE
ENVIRONMENTAL LAWS WHICH ARISES FROM THE ACTS OR OMISSIONS OF
TENANT OR ANY
TENANT PARTIES ON, AT, OR IN THE PREMISES OR PROPERTY WHICH ARE
IN
VIOLATION OF ANY ENVIRONMENTAL LAWS AND ANY FINE OR ASSESSMENT
PURSUANT TO
THE
ENVIRONMENTAL LAWS WHICH ARISES FROM A CONDITION AT THE PREMISES
OR
PROPERTY THAT EXISTED PRIOR TO THE COMMENCEMENT DATE.
7.6.5
Notice of Claims by Tenant. Tenant shall give written notice to
Landlord of any claim, litigation, investigation,
administrative
enforcement action or proceeding made or threatened and alleging a
Release
or
Threatened Release of Hazardous Substances at the Premises or
Property
(the
"PENDING CLAIM"), or of any investigations or proceedings or
inquiries
regarding conditions at the Premises or Property before or by
any
Governmental Authority (including, without limitation, the
Connecticut
Department of Environmental Protection) with respect to the
presence of any
Hazardous Substances on the Premises or Property or the migration
thereof
from
or to other property (the "PROCEEDINGS"), promptly after Tenant
receives actual
knowledge of same, and shall promptly deliver to Landlord
any
notice of any violation of Environmental Laws by Tenant received
by
Tenant.
7.6.6 Prohibited Activities; Remediation. If at any time (a)
the
operation or use of the Premises by Tenant violates any
applicable
Environmental Law, (b) Hazardous Substances are Released at, in,
on, under
or
about the Property in violation of any applicable Environmental
Law, (c)
if
Tenant's actions or omissions result in the requirement of any form
of
cleanup or corrective action of Hazardous Substances on the
21
<PAGE>
Premises or Property (or any other real property adjacent or
adjoining the
Property), then, Tenant shall take, at Tenant's sole cost and
expense, such
remedial actions as may be necessary to fully comply with all
applicable
Environmental Laws. Any such remedial action taken by Tenant
("REMEDIAL
WORK"), shall be performed in a manner approved by Landlord by one
or more
contractors, approved in advance in writing by Landlord, and under
the
supervision of a consulting engineer approved in advance in writing
by
Landlord (such approvals not to be unreasonably withheld), and
shall be
carried out at Tenant's sole cost and expense in full compliance
with all
Environmental Laws and all requirements of any Governmental
Authorities
having jurisdiction over such Remedial Work. Such work shall be
performed
in
such manner that it does not result in the imposition upon the
Premises
or
Property of any more stringent or limited restrictions on the
ownership,
occupancy, transferability or use of the Premises or Property under
any
Environmental Laws, such as liens, institutional controls or
deed
restrictions, than existed with regard to the Premises or Property
before
undertaking the Remedial Work. Any proposed Remedial Work shall
be
performed pursuant to a remediation plan consistent with the
requirements
of
applicable Environmental Laws and shall be subject to Landlord's
prior
review and approval which shall not be unreasonably withheld.
Tenant shall
give
Landlord written notice of any Remedial Work to be undertaken
by
Tenant on or affecting
the Premises or Property not less than thirty (30)
days
prior to commencing such work (unless notice is not practical
because
of
the need for immediate response, in which case Tenant shall
notify
Landlord in writing immediately upon obtaining actual knowledge of
the need
for
such Remedial Work). All costs and expenses of Remedial Work which
is
the
obligation of Tenant shall be paid by Tenant, including,
without
limitation, the charges of all contractor(s) and any consulting
engineer(s)
and
the expense of the review by, and supervision of, Landlord's
environmental consultant. No consent or approval by Landlord given
or
withheld in connection with any such Remedial Work, nor any
inspection or
monitoring by Landlord, shall be deemed to impose any liability on
Landlord
with
respect to such Remedial Work or the manner, quality or
sufficiency
thereof.
7.6.7 Access: Inspection. Tenant hereby grants Landlord the right
to
access to the Premises to inspect the Premises on not less than
twenty-four
(24)
hours notice to Tenant (except in the event of an emergency in
which
case
Landlord will use reasonable efforts commensurate with the nature
of
the
emergency condition to give Tenant prior notice) throughout the
Term,
provided that such notice includes a reasonable basis for such
inspection
to
determine that Tenant is in compliance with Environmental Laws and
the
provisions of this Article 7 of this Lease. Landlord shall conduct
any such
inspection in a manner reasonably calculated to cause the least
amount of
disruption consistent with the nature of the investigation to
Tenant's
business and other legitimate purposes of occupation.
7.6.8 Environmental Liens. If a lien is filed against the Property
by
any
Governmental Authority resulting from the need to expend or the
actual
expending of monies arising from an action or omission, whether
intentional
or
unintentional, of Tenant or for which Tenant is responsible,
resulting
in
the Release or Threatened Release of any Hazardous Substance into
the
air,
waters or onto land located within or without the state where
the
Property is located, then Tenant shall within thirty (30) days from
the
date
that Tenant receives notice that such lien has been placed against
the
Property, pay (or otherwise satisfy) the claim and remove the lien.
If a
lien
is filed against the Property by any Governmental Authority
resulting
from
the need to expend or the actual expending of monies arising from
an
action or omission, whether intentional or unintentional, of the
Landlord
or
arising by virtue of a condition existing prior to the Tenant
taking
occupancy or for which the Landlord is responsible, resulting in
the
Release or Threatened Release of any Hazardous Substance into the
air,
waters or onto land located within or without the state where the
Property
is
located, then Landlord shall within thirty (30) days from the
22
<PAGE>
date
that Landlord receives notice that such lien has been placed
against
the
Property, pay (or otherwise satisfy) the claim and remove the
lien.
7.6.9 Environmental Indemnity by Tenant. In addition to the
indemnity
arising under Section 7.6.3 in connection with the Connecticut
Transfer
Act,
Tenant shall indemnify, defend, and hold Landlord and any mortgagee
of
the
Property fully harmless, from and against any and all liability,
loss,
suits, claims, actions, causes of action, remediation orders,
proceedings,
demands, costs, penalties, damages, fines and expenses, including,
without
limitation, attorneys' fees, consultants' fees, laboratory
fees,
remediation costs, and other costs of Remedial Work, and the costs
and
expenses of investigating and defending any claims or
proceedings,
resulting from, or attributable to:
(a) Except to the extent caused by or arising out of the act or
omission of the Landlord or a Landlord party, the Release or
Threatened Release of any Hazardous Substance at, in, on,
under,
above, from or affecting the Premises or the Property arising from
the
action, inaction or negligence of Tenant, its officers,
employees,
contractors, agents, subtenants or invitees, or arising out the
generation, storage, treatment, handling, transportation, disposal
or
release by Tenant of any Hazardous Substance at or near the
Premises
or the Property, during any period of ownership of the Property
by
Tenant preceding the Commencement Date and during the Term,
(b) any violation(s) by Tenant of any Environmental Law
regarding
Hazardous Substances, during any period of ownership of the
Property
by Tenant preceding the Commencement Date and during the term,
(c) default of any of its agreements under this Section 7.6 of
this Lease;
(d) any personal injury (including wrongful death) or property
damage (real or personal) arising out of or related to
subsections
(a), (b) or (c) above; or
(e) any lawsuit brought or threatened against, settlement
reached
by, or order or directive of or by any Governmental Authority
relating
to such Hazardous Substances under subsections (a), (b) or (c)
above
issued against the Landlord. In any action, suit or proceeding
brought
against Landlord by reason of any matters included with this
indemnity, Tenant will, at Tenant's expense, resist and defend
such
action, suit or proceeding with counsel reasonably acceptable
to
Landlord. The parties agree that such indemnification by Tenant
shall
survive the expiration or sooner termination of this Lease.
7.6.10 Environmental Indemnity by Landlord. Landlord shall
indemnify,
defend, and hold Tenant fully harmless from and against any and
all
liability, loss, suits, claims, actions, causes of action,
remediation
orders, proceedings, demands, costs, penalties, damages, fines
and
expenses, including, without limitation, attorneys' fees,
consultants'
fees, laboratory fees, and the costs and expenses of investigating
and
defending any claims or proceedings, resulting from, or
attributable to:
(a) Except to the extent caused by or arising out of the act or
omission of the Tenant or a Tenant Party, the Release of any
Hazardous
Substances at, in, on, under, above, or from the Premises or
the
Property caused by the action, inaction or negligence of Landlord,
its
officers, employees,
contractors and agents, during any period of
ownership of the Property by Landlord during the Term,
23
<PAGE>
(b) any other violation(s) by Landlord of any Environmental Law
regarding Hazardous Substances on or in the Premises or
Property,
during any period of ownership of the Property by Landlord during
the
Term,
(c) default of any of Landlord's agreements under this Section
7.6 of this Lease;
(d) any personal injury (including wrongful death) or property
damage (real or personal) resulting from subsections (a) or (b)
above;
or
(e) any lawsuit brought or threatened, settlement reached, or
order or directive of or by any Governmental Authority resulting
from
subsections (a) or (b) above. In any action, suit or proceeding
brought against Tenant by reason of any matters included with
this
indemnity, Landlord will, at Landlord's expense, resist and
defend
such action, suit or proceeding with counsel reasonably acceptable
to
Tenant. The parties agree that such indemnification by Landlord
shall
survive the expiration or sooner termination of this Lease.
7.6.11 Environmental Reports. Tenant shall provide Landlord with
all
environmental reports, whether or not in draft form and subject
to
confidentiality requirements, in its possession or commissioned by
Tenant
prior to and subsequent to the Commencement Date until termination
of this
Lease. In addition, Tenant agrees to provide Landlord with
information
reasonably required by Landlord to ascertain that Tenant is in
compliance
with
the Environmental Laws and provisions of Article 7 of this
Lease,
including but not limited to hazardous waste manifests and reports
to state
and
federal environmental agencies. Upon Landlord's request in
writing,
Tenant promptly shall furnish additional information to Landlord
with
regard to any generation, storage, use, or disposal of Hazardous
Substances
as
part of Tenant's operations.
7.7
Signage. EXCEPT FOR THE EXISTING SIGNAGE AT THE BUILDING, TENANT
SHALL
NOT HAVE ANY RIGHT TO PLACE ANY SIGN, MONUMENT, ADVERTISING,
ANTENNA OR OTHER
SIGNAGE OR STRUCTURE AT ANY LOCATION OUTSIDE THE PREMISES AT THE
BUILDING OR THE
PROPERTY. LANDLORD SHALL HAVE THE RIGHT TO APPROVE OR DISAPPROVE
THE CONTENT,
DESIGN, SIZE AND LOCATION OF ANY AND ALL SIGNAGE PROPOSED TO BE
ERECTED OR
MAINTAINED AT THE PREMISES, WHICH APPROVAL SHALL NOT BE
UNREASONABLY WITHHELD.
TENANT SHALL PAY FOR ALL COSTS TO CHANGE SIGNAGE AS A RESULT OF A
CHANGE IN THE
NAME OF THE BUSINESS OCCUPYING THE PREMISES. IF LANDLORD APPROVES
ANY ADDITIONAL
SIGNAGE, TENANT SHALL BE REQUIRED TO OBTAIN ANY REQUIRED ZONING AND
RELATED
APPROVALS FROM APPLICABLE GOVERNMENTAL AUTHORITIES. THE
INSTALLATION OF ANY
APPROVED SIGNAGE SHALL BE PERFORMED IN A GOOD AND WORKMANLIKE
MANNER IN
ACCORDANCE WITH ALL APPLICABLE LAWS AND THE TERMS OF THIS LEASE.
ANY PERMITTED
SINGS INSTALLED ON OR ABOUT THE PREMISES SHALL BE REMOVED AT THE
EXPIRATION OR
SOONER TERMINATION OF THE TERM OF THIS LEASE AND THE PREMISES
PROMPTLY REPAIRED
OR RESTORED TO ITS ORIGINAL CONDITIONS WHERE SUCH SIGN HAS BEEN
REMOVED. TENANT
SHALL PAY ALL EXPENSES, AND ALL LICENSE AND PERMIT FEES RELATING TO
THE
INSTALLATION AND MAINTENANCE OF AUTHORIZED SIGNS, AND SHALL PAY ALL
EXPENSES OF
REMOVAL AND COSTS OF REPAIRS RESULTING THEREFROM.
ARTICLE 8 REPAIR AND MAINTENANCE; ALTERATIONS AND IMPROVEMENTS
8.1
Landlord's Obligations. SUBJECT TO SECTION 5.6 HEREOF, LANDLORD, AT
ITS
EXPENSE, SHALL BE RESPONSIBLE TO REPLACE THE FOLLOWING PORTIONS OF
THE PROPERTY
(THE "Landlord's Replacement Obligations"): (A) BUILDING'S ROOFING
AND FLASHING
(EXCLUDING ANY OF THE ROOF'S STRUCTURAL COMPONENTS), SUBJECT TO
TENANT'S
OBLIGATION TO COMPLETE THE "TENANT ROOF REPAIRS" (AS DEFINED BELOW
IN SECTION
8.2.5), AT TENANT'S SOLE EXPENSE; (B) EXISTING BASE BUILDING ROOF
TOP HVAC UNIT
(AND RELATED MAJOR COMPONENT EQUIPMENT) WHICH ARE IDENTIFIED IN
EXHIBIT H
ATTACHED HERETO AS THE "BASE BUILDING HVAC UNITS", BUT EXCLUDING
ANY SPECIALTY
UNITS THAT ARE USED IN TENANT'S ASSEMBLY OR MANUFACTURING
PROCESSES; AND (C) THE
ASPHALT PAVED PARKING AREAS AND DRIVEWAYS, SUBJECT TO TENANT'S
OBLIGATION TO
24
<PAGE>
COMPLETE THE "TENANT PAVING REPAIRS" (AS DEFINED IN SECTION 8.2.6),
AT TENANT'S
SOLE EXPENSE. LANDLORD, IN ITS SOLE DISCRETION, SHALL DETERMINE
WHETHER THE
CONDITION OF ANY OF THE FOREGOING ITEMS WILL BE ADDRESSED BY REPAIR
OR
REPLACEMENT. THE DECISION, MANNER AND SCHEDULING OF ANY REPAIR OR
REPLACEMENT
INVOLVED IN LANDLORD'S REPLACEMENT OBLIGATIONS SHALL BE IN
LANDLORD'S SOLE
DISCRETION. LANDLORD AGREES THAT IT SHALL UNDERTAKE LANDLORD'S
REPLACEMENT
OBLIGATIONS IN A MANNER REASONABLY CALCULATED TO CAUSE THE LEAST
AMOUNT OF
DISRUPTION OF TENANT'S BUSINESS OPERATION CONSISTENT WITH THE
NATURE OF THE
CONSTRUCTION ACTIVITY AND NORMAL CONSTRUCTION PRACTICE. EXCEPT FOR
LANDLORD'S
REPLACEMENT OBLIGATIONS AND THE SERVICES TO BE PROVIDED BY LANDLORD
AS DESCRIBED
IN SECTION 6.1 HEREOF, AND AS OTHERWISE SET FORTH IN THIS LEASE,
WHICH SHALL BE
AT TENANT'S COST AND EXPENSE, LANDLORD SHALL NOT HAVE ANY
OBLIGATIONS TO
MAINTAIN OR REPAIR (INCLUSIVE OF ANY REPLACEMENTS) THE PREMISES,
BUILDING OR
PROPERTY. THE COST OF THE MAINTENANCE AND REPAIR PERFORMED BY
LANDLORD UNDER
SECTION 6.1 HEREOF SHALL BE INCLUDED IN OPERATING EXPENSES AND
SHALL BE SUBJECT
TO REIMBURSEMENT UNDER ARTICLE 5 HEREOF. MAINTENANCE AND REPAIR
EXPENSES PAID OR
INCURRED BY LANDLORD CAUSED BY TENANT'S WILLFUL MISCONDUCT OR
NEGLIGENT ACTS OR
OMISSIONS SHALL BE PAID DIRECTLY TO LANDLORD BY TENANT IN
ACCORDANCE WITH
SECTION 4.4.
8.2
Tenant's Obligations.
8.2.1 MAINTENANCE AND REPAIR. EXCEPT FOR THOSE REPLACEMENTS
THAT
COMPRISE LANDLORD'S REPLACEMENT OBLIGATIONS UNDER SECTION 8.1
ABOVE, AND
THE
SERVICES PROVIDED BY LANDLORD AS DESCRIBED IN SECTIONS 5.6 AND
SECTION
6.1
HEREOF (WHICH SHALL BE SUBJECT TO REIMBURSEMENT BY TENANT AS
OPERATING
EXPENSES AS PROVIDED BY SECTION 5.1 HEREOF), TENANT, AT TENANT'S
COST AND
EXPENSE, SHALL KEEP THE PREMISES, BUILDING AND COMMON AREAS IN GOOD
REPAIR
AND
MAINTENANCE AT ALL TIMES, AND TENANT SHALL ALSO BE RESPONSIBLE, AT
ITS
COST
AND EXPENSE, TO MAKE ALL REPAIRS, REPLACEMENTS AND CAPITAL
IMPROVEMENTS NECESSARY TO PRESERVE THE PREMISES, BUILDING AND
COMMON AREAS
IN
GOOD WORKING ORDER AND IN A CLEAN, SAFE AND SANITARY CONDITION,
INCLUDING, WITHOUT LIMITATION:
(a) ALL STRUCTURAL COMPONENTS OF THE BUILDING, INCLUDING THE
ROOF, EXTERIOR LOAD BEARING WALLS, FOOTINGS FOUNDATION, COLUMNS,
BEAMS
AND FLOOR AND CEILING SLABS;
(b) all Building doors, exterior and interior glass, windows
locks, loading docks (including dock doors and related equipment)
and
signage;
(c) all roof-top HVAC units (and related component equipment);
(d) all electrical, mechanical, HVAC, fire protection,
sprinkler,
plumbing, and telecommunications systems (including all
component
facilities, fixtures and devices) located within the Building;
and
Building elevators (if any);
(e) all utility and other systems serving the Building (and
component equipment) including water, sewer, natural gas,
electric,
fuel, oil, steam and chilled water;
(f) all elevators, columns, beams, shafts (including elevator
shafts), stairs, stairwells, paved parking areas, driveways,
sidewalks
and curbs;
(g) janitorial and cleaning services; trash, garbage and refuse
removal; and pest extermination;
(h) landscaping and grounds maintenance, including lawn moving,
tree pruning, annual flower planting, snow plowing and sweeping of
the
parking
25
<PAGE>
lot; and the maintenance and repair (and replacement) of any
existing
irrigation system; and
(i) all Building and Premises security as required by Tenant
(in
its discretion) for its own business operations.
8.2.2 LANDLORD'S SERVICES. DURING THE TERM LANDLORD SHALL PROVIDE
THE
SERVICES STATED IN SECTION 6.1 HEREOF, AT TENANT'S EXPENSE, AND
SUCH
PERFORMANCE BY LANDLORD SHALL FULFILL TENANT'S OBLIGATIONS UNDER
SUBSECTION
8.2.1 WITH RESPECT TO THOSE ITEMS.
8.2.3 LANDLORD'S RIGHT TO PERFORM. TENANT SHALL ALSO REPAIR, AT
ITS
COST, ALL DETERIORATIONS OR DAMAGES TO THE PROPERTY OCCASIONED BY
ITS
NEGLIGENT ACTS OR OMISSIONS OR WILLFUL MISCONDUCT. IF TENANT DOES
NOT MAKE
REPAIRS TO THE PROPERTY THAT ARE TENANT'S RESPONSIBILITY UNDER THIS
SECTION
8.2
WITHIN THIRTY (30) DAYS FOLLOWING DEFAULT NOTICE FROM LANDLORD,
LANDLORD MAY, BUT NEED NOT, MAKE SUCH REPAIRS, AND TENANT SHALL PAY
THE
COST
THEREOF AS PROVIDED IN SECTION 7.6 HEREOF. ALL REPAIRS AND
REPLACEMENTS MADE BY OR ON BEHALF OF TENANT SHALL BE MADE AND
PERFORMED IN
ACCORDANCE WITH THE "Construction Standards" (AS DEFINED IN SECTION
8.3).
8.2.3 Replacements. Tenant's obligations to maintain and repair
the
Property includes the responsibility for all capital repairs and
capital
replacements, excluding those matters that comprise Landlord's
Replacement
Obligations. The HVAC units that are used by Tenant for its
assembly or
manufacturing processes and which are not subject to Landlord's
Replacement
Obligati
