LEASE

 

 

TABLE OF CONTENTS

 

		PAGE
ARTICLE 1 BASIC DATA; DEFINITIONS		1
1.1	Basic Data	1
1.2	Enumeration of Exhibits	5
ARTICLE 2 PREMISES, APPURTENANT RIGHTS AND RESERVATIONS		5
2.1	Lease of Premises	5
2.2	Appurtenant Rights and Landlord Reservations	6
2.3	Security	7
2.4	Elm Parcel Right of First Offer	7
2.5	Tenant Access	8
ARTICLE 3 BASIC RENT		8
3.1	Payment	8
ARTICLE 4 TERM COMMENCEMENT DATE/EXTENSION TERMS		8
4.1	Term Commencement Date	8
4.2	Extension Option	9
ARTICLE 5 CONDITION OF PREMISES		10
5.1	Preparation of the Premises	10
5.2	Landlord’s Work	10
5.3	Landlord’s Contribution	11
5.4	Condition of Premises	12
5.5	Swing Space	12
ARTICLE 6 USE OF PREMISES		12
6.1	Permitted Use	12
6.2	Signage	12
6.3	Other Requirements	13
6.4	Extra Hazardous Use	13
6.5	Hazardous Materials	13
ARTICLE 7 INSTALLATIONS AND ALTERATIONS BY TENANT		15
7.1	General	15
7.2	Requirements for Alterations	15
7.3	Tenant’s Removable Property	15
7.4	Liability; Mechanics’ Liens	15
7.5	Intentionally Omitted	16
7.6	Telecommunications	16
7.7	Building Expansions	16
ARTICLE 8 ASSIGNMENT AND SUBLETTING		18
8.1	Prohibition	18

 

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8.2	Additional Events Deemed to be Assignment/Sublet	19
8.3	Provisions Incorporated Into Sublease	19
8.4	Collection of Rent	20
8.5	Excess Payments	20
8.6	Payment of Landlord’s Costs	20
8.7	Conditions to Effectiveness of Assignment/Sublet	21
ARTICLE 9 MAINTENANCE, REPAIRS AND REPLACEMENTS		21
9.1	Landlord’s Obligations	21
9.2	Tenant’s Obligations	22
ARTICLE 10 UTILITIES AND OTHER SERVICES		23
10.1	Heating, Ventilation and Air-Conditioning	23
10.2	Utilities	23
ARTICLE 11 REAL ESTATE TAXES		25
11.1	Payments on Account of Real Estate Taxes	25
11.2	Abatement	26
ARTICLE 12 OPERATING EXPENSES		26
12.1	Definitions	26
12.2	Tenant’s Payment of Operating Expenses	27
12.3	Triple Net Lease	28
ARTICLE 13 INDEMNITY AND INSURANCE		28
13.1	Tenant’s Indemnity	28
13.2	Tenant’s Insurance	29
13.3	Waiver of Subrogation	30
13.4	Landlord Insurance	30
ARTICLE 14 FIRE, EMINENT DOMAIN, ETC.		31
14.1	Landlord’s Right of Termination	31
14.2	Restoration; Tenant’s Right of Termination	32
14.3	Abatement of Rent	32
14.4	Condemnation Award	32
ARTICLE 15 ADDITIONAL COVENANTS		33
15.1	Tenant	33
15.2	Landlord	33
15.3	As to Both Parties	34
ARTICLE 16 HOLDING OVER; SURRENDER		34
16.1	Holding Over	34
16.2	Surrender of Premises	34
ARTICLE 17 RIGHTS OF MORTGAGEES		35
17.1	Rights of Mortgagees	35
17.2	Assignment of Rents	35

 

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17.3	Notice to Holder	36
ARTICLE 18 LETTER OF CREDIT/SECURITY DEPOSIT		36
18.1	Letter of Credit	36
18.2	Security Deposit	37
18.3	Application of Security Deposit	37
18.4	Intentionally Omitted	38
ARTICLE 19 DEFAULT; REMEDIES		38
19.1	Tenant’s Default	38
19.2	Landlord’s Remedies	40
19.3	Additional Rent	42
19.4	Remedies Cumulative	42
19.5	Attorneys’ Fees	42
19.6	Waiver	42
19.7	Landlord’s Default	43
19.8	Tenant’s Remedies	43
19.9	Landlord’s Liability	43
ARTICLE 20 MISCELLANEOUS PROVISIONS		44
20.1	Brokerage	44
20.2	Invalidity of Particular Provisions	44
20.3	Provisions Binding, Etc.	44
20.4	Notice	44
20.5	When Lease Becomes Binding; Entire Agreement; Modification	45
20.6	Headings and Interpretation of Sections	45
20.7	Waiver of Jury Trial	45
20.8	Time Is of the Essence	45
20.9	Multiple Counterparts	46
20.10	Governing Law	46
20.11	Condominium	46

 

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LEASE

 

THIS LEASE is dated as of April 25, 2005 between the Landlord and the Tenant named below, and is of space in the Buildings described below.

 

ARTICLE 1
BASIC DATA; DEFINITIONS

 

1.1          Basic Data . Each reference in this Lease to any of the following terms shall be construed to incorporate the data for that term set forth in this Section:

 

Landlord: BCIA New England Holdings LLC, a Delaware limited liability company.

 

Landlord’s Address: c/o CrossHarbor Capital Partners LLC, One Boston Place, Boston, Massachusetts 02108.

 

Landlord’s Managing Agent: BCIA Property Management LLC, or such other person or entity from time to time designated by Landlord.

 

Tenant: Caliper Life Sciences, Inc., a Delaware corporation.

 

Tenant’s Address: 68 Elm Street, Hopkinton, Massachusetts 01748.

 

Building No. 68: The building commonly known and numbered as 68 Elm Street, Hopkinton, Massachusetts, as shown on the site plan attached hereto as Exhibit A, as the same may be expanded by Expansions.

 

Building No. 68 Rentable Area: Agreed to be 40,800 rentable square feet on the date hereof.

 

Building No. 78: The building commonly known and numbered as 78 Elm Street, Hopkinton, Massachusetts, as shown on the site plan attached hereto as Exhibit A, as the same may be expanded by Expansions.

 

Building No. 78 Rentable Area: Agreed to be 76,114 rentable square feet on the date hereof.

 

Buildings: Collectively, Building No. 68 and Building No. 78, agreed to contain 116,914 rentable square feet on the date hereof (each, a “Building” ).

 

Land: The parcels of land upon which Building No. 68 and Building No. 78 and their respective parking areas are situated, respectively shown cross-hatched and labeled on Exhibit A as 68 Elm Parcel and 78 Elm Parcel .

 

Property: The Land together with the Buildings and other improvements thereon.

 

Initial Premises: Building No. 68 and Building No. 78.

 

 

Premises: The Initial Premises, together with any Expansions which may be added thereto from time to time upon exercise of Tenant’s rights under Section 7.7, and together with the Swing Space during any period of use of the same by Tenant.

 

Expansion and Expansions: As defined in Section 7.7.

 

Premises Rentable Area: Agreed to be 116,914 rentable square feet, as the same may be increased from time to time to reflect any Expansions.

 

Park: Parcel A as shown on the site plan attached hereto as Exhibit A, together with all improvements thereon and all driveways, roads, drainage, utilities or other facilities appurtenant to or serving the same.

 

Basic Rent: The Basic Rent prorated at the beginning and end of the Term if appropriate pursuant to Section 3.1 for the Initial Term is as follows:

 

RENTAL PERIOD		ANNUAL BASIC RENT		MONTHLY PAYMENT
From the Term Commencement Date through December 31, 2005.		The Annual Basic Rent under the Prior Leases, the provisions of which are incorporated herein by this reference for such purpose		The monthly payment of Basic Rent under the Prior Leases
From January 1, 2006 through June 30, 2008.		$1,227,597.00		$102,299.75
July 1, 2008 through December 31, 2011.		$1,490,653.50		$124,221.13
January 1, 2012 through the Initial Expiration Date.		$1,607,567.50		$133,963.96

 

If Tenant exercises the First Extension Option as provided in Section 4.2 hereof, then the Basic Rent for the First Extension Term shall be the greater of (i) $13.75 multiplied by the rentable square feet of the Premises Rentable Area as of the end of the Initial Term (but in no event less than 116,914 rentable square feet) and (ii) the “First Extension Term Fair Market Rent,” meaning the Basic Rent as determined: (A) by agreement between Landlord and Tenant no later than thirty (30) days after Tenant’s timely exercise of the First Extension Option, provided that if Landlord and Tenant shall not have agreed upon the First Extension Term Fair Market Rent by said date as aforesaid (an “Impasse” ), then First Extension Term Fair Market Rent for the First Extension Term shall be fixed by means of an Appraisers’ Determination as more particularly described in Exhibit F hereto.

 

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If Tenant exercises the Second Extension Option as provided in Section 4.2 hereof, then the Basic Rent for the Second Extension Term shall be the greater of (i) the Annual Basic Rent in effect immediately prior to the expiration of the First Extension Term on a per rentable square foot basis multiplied by the number of rentable square feet of Premises Rentable Area as of the end of the First Extension Term (but in no event less than 116,914 rentable square feet), and (ii) the “Second Extension Term Fair Market Rent,” meaning the Basic Rent as determined: (A) by agreement between Landlord and Tenant no later than thirty (30) days after Tenant’s timely exercise of the Second Extension Option, provided that if Landlord and Tenant have reached an Impasse with respect to the determination of the Second Extension Term Fair Market Rent, then Second Extension Term Fair Market Rent for the Second Extension Term shall be fixed by means of an Appraisers’ Determination as more particularly described in Exhibit F hereto.

 

Additional Rent: All charges and sums which Tenant is obligated to pay to Landlord pursuant to the provisions of this Lease, other than and in addition to Basic Rent.

 

Rent: Basic Rent and Additional Rent.

 

Tenant’s Proportionate Share: One hundred percent (100%) (which is based on the ratio of the agreed upon (a) Premises Rentable Area to (b) Building Rentable Area).

 

Security Deposit: Any sum, including without limitation, the unapplied proceeds of any Letter of Credit delivered to Landlord, from time to time, to secure the payment and performance of Tenant’s obligations under this Lease.

 

Letter of Credit: A letter of credit conforming to the requirements set forth in Section 18.1(a)  in the initial sum of One Million Four Hundred Seventy-Three Thousand One Hundred Sixteen Dollars and 40/100 ($1,473,116.40) to be held and disposed of as provided in ARTICLE 18.

 

Term Commencement Date: The date hereof.

 

Rent Commencement Date: The date hereof.

 

Expiration Date: December 31, 2015 as the same may be extended pursuant to Section 7.7 (the “Initial Expiration Date” ), subject to Tenant’s Termination Right set forth in Section 7.7, and provided that such Expiration Date shall be extended if Tenant exercises its First Extension Option or Second Extension Option, as the case may be.

 

Term: Commencing on the Term Commencement Date and expiring at 11:59 p.m. on the Expiration Date (the “Initial Term” ). The Term shall include any extension thereof that is expressly provided for by this Lease and that is exercised strictly in accordance with this Lease.

 

Right of First Offer: Tenant’s right to purchase or lease the vacant land referred to as the Elm Parcel (as hereinafter defined) as shown cross-hatched and labeled as Elm Parcel on Exhibit A hereto as provided in Section 2.4.

 

First Extension Option: Tenant’s right to extend the Term hereof in accordance with Section 4.2.

 

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Prior Leases: The following Leases with respect to the Premises collectively constitute the Prior Leases: (i) that certain lease dated October 9, 1982, as amended, between Landlord’s predecessor in title Elmwood Realty Associates (“Elmwood”) and Zymark Corporation (“Zymark”) as to which Tenant was a successor by merger and successor tenant, with respect to Building No. 68; (ii) that certain lease dated September 9, 1986, as amended, between Elmwood and Zymark with respect to 52,114 rentable square feet in Building No. 78; and (iii) that certain lease dated December 30, 1993, as amended, between Elmwood and Zymark with respect to an additional 24,000 expansion space in Building No. 78, which Prior Leases are superseded hereby as of the Term Commencement Date (1) except to the extent provisions thereof are incorporated herein and (2) except that all provisions thereof which are stated to survive the expiration of the term thereof or the earlier termination thereof shall so survive. The security deposit of $5,000 held by Landlord with respect to the Prior Leases shall be returned to Tenant upon the execution of this Lease and the delivery of the Letter of Credit.

 

1.2          Enumeration of Exhibits . The following Exhibits are attached hereto, and are incorporated herein by reference.

 

Exhibit A		Site Plan of Buildings and Park
Exhibit A-1		Expansions Application Plans
Exhibit A-2		Swing Space Plan
Exhibit B		Operating Expenses
Exhibit C		Rules and Regulations of Building
Exhibit D		Form of Notice of Lease
Exhibit E		Form of Letter of Credit
Exhibit F		Appraiser’s Determination of Fair Market Rent
Exhibit G		Qualified Base Building Improvements
Exhibit H		SNDA

 

ARTICLE 2
PREMISES, APPURTENANT RIGHTS AND RESERVATIONS

 

2.1         Lease of Premises . Landlord hereby leases to Tenant and Tenant hereby leases from Landlord the Premises, to have and to hold, for the Term and upon the terms and conditions set forth herein.

 

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2.2         Appurtenant Rights and Landlord Reservations .

 

(a)           Appurtenant Rights .

 

Tenant shall have, as appurtenant to the Premises, the non-exclusive right to use, and permit its invitees to use in common with others entitled thereto, (A) the common areas, driveways roads, drainage, and utilities of the Park to the extent that the same actually service the Premises, and (B) easements, rights of way or other rights, if any, which are appurtenant to the Property pursuant to any recorded documents evidencing such easements or rights and the parking from time to time provided for the Buildings; but such rights shall always be subject to (i) reservations, restrictions, easements and encumbrances of record, from time to time, as the same may be amended (ii) such conditions, rules and regulations from time to time established by Landlord with respect to the Property or the Park pursuant to Section 6.3(c)  (the “Rules and Regulations” ), and (iii) Landlord’s reservations set forth in subsection (b) below. Tenant shall have the exclusive right to use the parking area shown on the cross-hatched area labeled “68 Elm Parcel” on Exhibit A for Building No. 68, and Tenant shall have the exclusive right to use the parking area shown on the cross-hatched area labeled “78 Elm Parcel” on Exhibit A for Building No. 78.

 

(b)           Landlord Reservations .

 

Landlord reserves the right to post “For Lease” signs on the Property during the last twelve (12) months of the Term, but such signage shall include no more than two signs and such signs shall not exceed 4 feet by 6 feet and shall not include banners on the Buildings. In addition, Landlord and Tenant acknowledge the request by the Town of Hopkinton to change the name, street address, and number of Building No. 78 and agree that the change can proceed based upon Landlord’s reasonable judgment as to the appropriate change in consultation with the Town of Hopkinton. Upon any such change, Landlord shall be responsible for costs associated with any changes to signage identifying the Building address which may be (1) affixed to the Building or (2) on a monument outside the Building but shall not be responsible for any of Tenant’s costs related to letterhead changes, notices to third parties, or otherwise.

 

Landlord further reserves the right to enter the Premises at all reasonable hours for the purpose of inspecting the Premises, doing maintenance, making repairs and replacements, reading meters or otherwise exercising its rights or fulfilling its obligations under this Lease, including without limitation, its rights as set forth in Section 9.2 hereof, and Landlord and Landlord’s Managing Agent also shall have the right to make access available at all reasonable hours to prospective or existing mortgagees, purchasers or tenants of any part of the Property. Such right of access shall be during business hours and after reasonable telephonic notice to Tenant except in the event of an emergency. If Tenant shall not be personally present to open and permit such entry into the Premises, Landlord or Landlord’s Agents shall nevertheless be able to gain such entry by contacting a representative of Tenant, whose name, address and telephone number shall be furnished by Tenant to Landlord within ten (10) days after the Term Commencement Date, and updated from time to time as necessary. If an excavation shall be made by Landlord or Landlord’s Agents upon the portion of the Land adjacent to any Building, or shall be authorized by Landlord or Landlord’s Agents to be made, Tenant shall afford to those parties causing or authorized to cause such excavation, license to enter upon the Premises for the purpose of doing such work as said parties shall deem necessary to preserve such Building from injury or damage and to support the same by proper foundations without any claim for damage or indemnity against Landlord, or diminution or abatement of Rent.

 

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Landlord further reserves the right to further develop the Park and to modify common areas as it determines in its sole discretion so long as the same does not prevent access to the Property, such development rights being limited by Section 2.4 and Section 7.7 hereof.

 

2.3          Security . Tenant shall be solely responsible for providing security for the Property. Landlord expressly disclaims any and all responsibility and/or liability for the physical safety of Tenant’s property, and for that of Tenant’s Agents, invitees and independent contractors. Tenant agrees that, as between Landlord and Tenant, it is Tenant’s responsibility to advise Tenant’s Agents, invitees and independent contractors as to necessary and appropriate safety precautions.

 

2.4          Elm Parcel Right of First Offer . Tenant shall have a one-time right of first offer (the “Right of First Offer” ) to purchase or lease the existing vacant, undeveloped, un-permitted parcel of land shown cross-hatched and labeled “Elm Parcel” on Exhibit A hereto (the “Elm Parcel” ) subject to the terms and provisions hereof. Except as set forth below, if Landlord decides to develop or market for sale or lease the Elm Parcel, Landlord agrees to notify Tenant in writing that Landlord intends to (a) develop or market or (b) lease the Elm Parcel (the “Elm Parcel Intention Notice” ) in which event Tenant shall have seven (7) Business Days from the date of the Elm Parcel Intention Notice to present a written offer to Landlord either to purchase (if the Elm Parcel Intention Notice related to a sale) or to lease (if the Elm Parcel Intention Notice related to a lease) the Elm Parcel (the “Offer” ). If within ten (10) Business Days following Landlord’s receipt of an Offer, Landlord and Tenant are unable to agree on the terms and conditions relating to the purchase and sale or lease of the Elm Parcel, then (i) Landlord shall be free to develop the Elm Parcel, (ii) Landlord shall be free to sell, if the Elm Parcel Intention Notice related to a sale, or lease if the Elm Parcel Intention Notice related to a lease, the Elm Parcel to any third party on such terms and conditions as may be agreed to with such third party, (iii) this Right of First Offer shall lapse, (iv) this Section 2.4 shall be void and of no further force and effect and (v) all other provisions of this Lease shall remain in full force and effect as if this Section 2.4 was not included therein.

 

If, following Landlord’s delivery of the Elm Parcel Intention Notice, Tenant shall fail to timely submit an Offer as set forth above, then (i) Landlord shall be free to develop the Elm Parcel, (ii) Landlord shall be free to sell the Elm Parcel to any third party on such terms and conditions as may be agreed to with such third party, (iii) this Right of First Offer shall lapse, (iv) this Section 2.4 shall be void and of no further force and effect, and (v) all other provisions of this Lease shall remain in full force and effect as if this Section 2.4 was not included therein.

 

Tenant’s right to be provided with the Elm Parcel Intention Notice and its right to submit an Offer to Landlord as set forth herein are conditioned upon (i) no uncured Default of Tenant existing on either the date the Offer is submitted to Landlord or the date the Elm Parcel is to be sold to Tenant as agreed upon by the parties, (ii) this Lease being in full force and effect, and (iii) Caliper Life Sciences, Inc. not having assigned this Lease nor sublet more than fifty percent (50%) of the rentable square footage of the Premises.

 

Notwithstanding any of the foregoing provisions to the contrary, Landlord shall have no obligation whatsoever to provide the Elm Parcel Intention Notice to Tenant or otherwise provide Tenant with an opportunity to purchase the Elm Parcel if Landlord at any time intends to market

 

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or sell the Elm Parcel together with any other material portion or portions of the Park, and upon any such sale, this Section 2.4 shall be void and of no further force and effect and all other provisions of this Lease shall remain in full force and effect as if this Section 2.4 was not included herein.

 

2.5          Tenant Access . Tenant shall have access to the Premises and the right to use and enjoy the Premises and the appurtenant rights as set forth in Section 2.2(a)  (subject to Landlord’s reservations set forth in Section 2.2(b)  and elsewhere in this Lease) twenty-four (24) hours per day, seven (7) days per week.

 

ARTICLE 3
BASIC RENT

 

3.1         Payment .

 

(a)           Tenant agrees to pay the Basic Rent and Additional Rent to Landlord, or as directed by Landlord, commencing on the Rent Commencement Date, without offset, abatement (except as provided in Section 14.3 ), deduction or demand. Basic Rent shall be payable in advance in lawful money of the United States in equal monthly installments, on the first day of each and every calendar month during the Term. All payments of Rent shall be sent to Landlord at Fleet Lock Box, Mail Code CTEHF03E, Boston Capital, Box 31130, 99 Founder’s Plaza, Hartford, Connecticut 06108, or at such other place as Landlord may from time to time designate by written notice or may be paid by wire transfer based upon the following instructions as the same may be amended from time to time: Bank of America, BCIA New England Holdings LLC, Account # 9419047140, ABA # 011 000 138, Reference: Elm Street/Caliper. In the event that any installment of Basic Rent or any payment of Additional Rent is not paid within five (5) days following when due, Tenant shall pay to Landlord, in addition to any charges due under Section 19.2(f), an administrative fee equal to 5% of the overdue amount. Landlord and Tenant agree that all amounts due from Tenant under or with respect to this Lease, whether labeled Basic Rent, Additional Rent or otherwise, shall be considered as rental reserved under this Lease for all purposes, including without limitation, regulations promulgated pursuant to the Bankruptcy Code, including without limitation, Section 502(b) thereof.

 

(b)           Basic Rent for any partial month falling within the Term shall be pro-rated on a daily basis, and if the first day on which Tenant must pay Basic Rent shall be other than the first day of a calendar month, the first payment which Tenant shall make to Landlord shall be equal to a proportionate part of the monthly installment of Basic Rent for the partial month from the first day on which Tenant must pay Basic Rent to the last day of the month in which such day occurs.

 

ARTICLE 4
TERM COMMENCEMENT DATE/EXTENSION TERMS

 

4.1          Term Commencement Date . The “Term Commencement Date” shall be January 1, 2006.

 

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4.2          Extension Option . Tenant shall have the option (the “First Extension Option” ) to extend the Term of this Lease for an additional period of five (5) years, commencing on the day following the originally scheduled Expiration Date and expiring on the day immediately preceding the five (5) year anniversary of the originally scheduled Expiration Date (the “First Extension Term Expiration Date” ), with such First Extension Option to be exercised by Tenant delivering to Landlord written notice thereof not less than twelve (12) months and not more than fifteen (15) months prior to the originally scheduled Expiration Date. Tenant’s right to exercise its First Extension Option is conditioned upon (a) no uncured Default of Tenant existing on the date of exercise or the date the First Extension Term (as hereinafter defined) is to commence, and (b) this Lease being in full force and effect. If Tenant exercises its First Extension Option, then the portion of the Term preceding the originally scheduled Expiration Date shall be referred to as the “Initial Term,” and the portion of the Term from and after the originally scheduled Expiration Date shall be referred to as the “First Extension Term.” The First Extension Term shall be upon all the same terms, covenants and conditions as the Initial Term, except (i) as to Basic Rent, which shall be determined as set forth in Section 1.1, (ii) that, except as set forth below with respect to Tenant’s Second Extension Option (as hereinafter defined), Tenant shall have no further extension rights unless otherwise expressly provided herein or hereafter agreed to in writing by Landlord, (iii) Tenant shall not be entitled to any period of “free rent” for the First Extension Term, (iv) there shall be no Landlord Contribution or similar contribution from Landlord for tenant improvements in connection with such First Extension Term, and (v) Landlord shall be under no obligation to perform any improvements or related work to the Premises.

 

Tenant shall have the option (the “Second Extension Option” ) to extend the Term of this Lease for an additional period of five (5) years following the First Extension Term, commencing on the day following the originally scheduled First Extension Term Expiration Date and expiring on the day immediately preceding the five (5) year anniversary of the originally scheduled First Extension Term Expiration Date, with such Second Extension Option to be exercised by Tenant delivering to Landlord written notice thereof not less than twelve (12) months and not more than fifteen (15) months prior to the originally scheduled First Extension Term Expiration Date. Tenant’s right to exercise its Second Extension Option is conditioned upon (a) no uncured Default of Tenant existing on the date of exercise or the date the Second Extension Term (as hereinafter defined) is to commence, and (b) this Lease being in full force and effect. If Tenant exercises its Second Extension Option, then the portion of the Term from and after the originally scheduled First Extension Term Expiration Date shall be referred to as the “Second Extension Term.” The Second Extension Term shall be upon all the same terms, covenants and conditions as the Initial Term, except (i) as to Basic Rent, which shall be determined as set forth in Section 1.1, (ii) that Tenant shall have no further extension rights unless otherwise expressly provided herein or hereafter agreed to in writing by Landlord, (iii) Tenant shall not be entitled to any period of “free rent” for the Second Extension Term, (iv) there shall be no Landlord Contribution or similar contribution from Landlord in connection with such Second Extension Term, and (v) Landlord shall be under no obligation to perform any improvements or related work to the Premises.

 

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ARTICLE 5
CONDITION OF PREMISES

 

5.1         Preparation of the Premises .

 

(a)           Tenant shall prepare, at its sole cost and expense (against which the Landlord’s Contribution may be applied), plans (the “Plans” ) for (i) the interior finish and layout of the initial improvements which Tenant desires to perform in the Premises, and (ii) the qualified base building improvements set forth on Exhibit G attached hereto (together, the “Initial Work” ). The Plans shall be submitted to Landlord, together with a construction budget setting forth the anticipated costs for the Initial Work (the “Estimated Initial Work Budget” ), and Landlord shall approve or disapprove of the Plans, in its reasonable discretion, in writing (and any disapproval by Landlord shall specify the matters objected to by Landlord), within thirty (30) days of receiving them. Landlord will not object to matters shown on initial plans that Landlord has reviewed and approved in writing prior to the date of this Lease to the extent not materially altered in the Plans. No work shall be conducted by or on behalf of Tenant until the Plans have been fully approved in writing by Landlord. At Tenant’s sole cost and expense (against which the Landlord’s Contribution may be applied), Tenant shall cause the Plans to be revised in a manner sufficient to remedy the Landlord’s objections and/or respond to the Landlord’s concerns and for such revised Plans to be redelivered to Landlord, and Landlord shall approve or disapprove Tenant’s revised Plans within ten (10) Business Days following the date of resubmission. Landlord’s failure to timely respond to Tenant’s submitted Plans or revised Plans shall be deemed to be an approval thereof.

 

The Plans shall be stamped by a Massachusetts registered architect and engineer, such architect and engineer and Tenant’s construction manager, general contractor and subcontractors, being subject to Landlord’s prior reasonable approval, and shall comply with Applicable Law and the requirements of the Rules and Regulations and shall be in a form satisfactory to appropriate governmental authorities responsible for issuing permits, approvals and licenses required for such Initial Work. Such architect and engineer and Tenant’s construction manager shall be subject to Landlord’s prior approval, which approval shall not be unreasonably withheld, conditioned, or delayed.

 

(b)             All of the Initial Work shall be completed by Tenant in accordance with the requirements set forth in the Rules and Regulations.

 

5.2          Landlord’s Work . While the Initial Work is conducted by Tenant, Landlord agrees to replace the roof membrane in accordance with plans and specifications prepared by Landlord on Building No. 68 (“Landlord’s Work”), and Landlord shall bear the full cost of the Landlord’s Work without any offset against Landlord’s Contribution or inclusion in Operating Expenses, it being acknowledged that Landlord shall have no obligation to maintain, repair or replace any other portion of the Buildings except as set forth in ARTICLE 9, and that any such maintenance, repair or replacement work, other than Landlord’s Work, may be included in Operating Expenses as further described in ARTICLE 12 and Exhibit B . So long as the Tenant’s Termination Right, as defined in Section 7.7, has expired without exercise, Landlord shall also provide an allowance to Tenant of $116,349.00 for the estimated cost to replace: (i) all rooftop HVAC units at Building No. 68, and (ii) the nine (9) 1986 rooftop HVAC units at

 

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Building No. 78 (the “HVAC Allowance” ). Tenant shall replace such HVAC units as part of the Initial Work and Landlord shall pay the HVAC Allowance to Tenant consistent with the procedures for payment of Landlord’s Contribution (without any requirement for Tenant to share in the expense of such replacement up to the amount of the HVAC Allowance).

 

5.3          Landlord’s Contribution . So long as the Tenant’s Termination Right, as defined in Section 7.7, has expired without exercise, Landlord shall reimburse Tenant for the costs incurred by Tenant with respect to the design and performance of the Initial Work and the Expansions (as defined in Section 7.7 ), if any, up to the amount of Landlord’s Contribution, subject to the provisions hereof; provided, however, that no more than Five Hundred Thousand Dollars ($500,000.00) of Landlord’s Contribution may be used by Tenant for so-called soft costs, including without limitation, costs related to design, architectural, engineering and construction planning services. To the extent that the Initial Work and any Expansions exceeds the Landlord’s Contribution, Tenant shall be entirely responsible for such excess, but in any case, Tenant shall spend no less than One Million Six Hundred Thousand Dollars ($1,600,000.00) with respect to the Initial Work and any Expansions, as more particularly set forth herein. Landlord’s Contribution shall be payable by Landlord to Tenant in installments, according to Landlord’s construction disbursement procedures as the Initial Work progresses, in the amount of two-thirds (2/3) of any installment of such costs and Tenant shall be obligated to pay one-third (1/3) of such costs until such time as Tenant has paid One Million Three Hundred Thousand Dollars ($1,300,000.00) of such costs; provided, however, that once Landlord has paid the entire Landlord’s Contribution and Tenant has paid One Million Three Hundred Thousand Dollar ($1,300,000.00), Tenant shall thereafter (i) pay no less than Three Hundred Thousand Dollars ($300,000.00) towards the Initial Work and any Expansions, and (ii) provide Landlord with satisfactory evidence that such payment has been made towards the Initial Work and any Expansions, on or before December 31, 2006, as may be extended pursuant to Section 7.7. Prior to the payment of any such installment of Landlord’s Contribution by Landlord, Tenant shall deliver to Landlord a written request, to be submitted no more frequently than once every thirty (30) days, for such disbursement, which request shall be accompanied by: (i) invoices for the Initial Work covered by any previous requisition; (ii) partial lien waivers or final lien waivers (in the case of a final installment) from all contractors and subcontractors; (iii) a certificate signed by the Architect and an officer of the Tenant certifying that the Initial Work represented by the aforementioned invoices has been completed substantially in accordance with the Plans; and (iv) evidence reasonably satisfactory to Landlord that Tenant has paid its respective share of Initial Work and Expansion costs to date as set forth above. Thereafter, Landlord’s Contribution shall be available for requisition as aforesaid and Landlord shall disburse such amounts within thirty (30) days following the date Tenant delivers to Landlord items (i) through (iv) above, until the same is exhausted. After Landlord’s Contribution is exhausted, Tenant shall then pay from its own funds all further sums necessary to complete the Initial Work and any Expansions; provided, however, that Tenant shall pay no less than Three Hundred Thousand Dollars ($300,000.00) towards the completion of the Initial Work and any Expansions on or before December 31, 2006, as set forth above, as may be extended pursuant to Section 7.7.

 

Any portion of Landlord’s Contribution which has not been applied on or before December 31, 2006 shall be deemed forfeited by Tenant and Landlord shall have no further obligation with respect thereto.

 

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5.4          Condition of Premises . Except for Landlord’s Contribution for the Initial Work and Landlord’s performance of Landlord’s Work under Section 5.2, the Premises are being leased by Tenant in their condition as of the delivery date, “As Is,” without representation or warranty by Landlord. Tenant acknowledges that it has inspected the Premises and, except for the Initial Work and Landlord’s Work under Section 5.2, has found the same satisfactory.

 

5.5          Swing Space . During the period commencing on the later of (a) the date on which Tenant notifies Landlord of its intent to occupy and use the Swing Space, (b) the date this Lease is fully executed and (c) the date on which Tenant’s Termination Right, as defined in Section 7.7, has expired without exercise, and ending on the earlier of (a) five (5) business days following Tenant’s substantial completion of the Initial Work, and (b) December 31, 2005, as may be extended pursuant to Section 7.7 (the “SS End Date” ), Tenant may use the portion of the building at 35 Parkwood Drive, Hopkinton, MA shown on Exhibit A-2 hereto for office and warehouse use (the “Swing Space” ). Tenant shall accept the Swing Space in its “as is” condition and Landlord shall have no obligation to prepare the Swing Space for Tenant’s occupancy except that if the Town of Hopkinton does not permit Tenant to occupy the Swing Space due to a building code issue, then Landlord shall be responsible for all costs associated with rectifying such issue. Tenant’s occupancy of the Swing Space shall be on all of the terms and conditions of this Lease except that (a) no Basic Rent shall be payable for the Swing Space, and (b) the following provisions of this Lease shall not be applicable to the Swing Space: Section 2.4, 3.1, Article 3, Article 4, Article 5, Section 6.2, 7.6, 7.7, Article 11, Article 12, Article 14, Article 18. Tenant will reimburse Landlord, upon billing therefor, for the excess of utilities cost during Tenant’s occupancy of the Swing Space over the monthly utility cost for the Swing Space during 2004. Tenant shall surrender the Swing Space on the SS End Date in accordance with Section 16.2 as though the Swing Space were the Premises and the Term hereof had expired or had earlier terminated.

 

ARTICLE 6
USE OF PREMISES

 

6.1          Permitted Use . Tenant agrees that the Premises shall be used and occupied by Tenant only for Permitted Uses and for no other use without Landlord’s prior express written consent. Tenant agrees and acknowledges that it has performed all investigations it has deemed necessary to satisfy itself that the use of the Premises for the Permitted Use is authorized under Applicable Law, including without limitation, all zoning laws in effect in the town/city in which the Property is located, and that Landlord has made no representations or warranties to Tenant with respect thereto.

 

6.2          Signage . Tenant shall have the right to install exterior signage on the Buildings bearing Tenant’s name and logo and a monument sign (which may be shared with other Park tenants) at the Park entrance provided that such signs or lettering comply with law and conform to any sign standards of Landlord and/or the Park, and provided that Tenant has submitted to Landlord a plan or sketch in reasonable detail (showing, without limitation, size, color, location, materials and method of affixation) of the sign to be placed on such entry doors. Landlord will not unreasonably withhold consent for any such sign which complies with the foregoing. Tenant shall not otherwise place on the exterior of the Buildings (including both interior and exterior

 

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surfaces of doors and interior surfaces of windows) or on any part of the Property, to the extent visible to the public, any sign, symbol, advertisement or the like.

 

6.3         Other Requirements . Tenant agrees to conform to the following provisions during the Term of this Lease:

 

(a)           Tenant shall not perform any act or carry on any practice which materially may injure the Premises, or any other part of the Buildings or the Property, other than that arising from normal wear and tear, nor shall approved Alterations constitute material injury so long as constructed in conformity with this Lease;

 

(b)           Tenant shall, in its use of the Premises, comply with Applicable Law;

 

(c)            Tenant shall abide by the Rules and Regulations for the Property and the Park which may be established from time to time by Landlord or the Park. In the event that there shall be a conflict between such Rules and Regulations and the provisions of this Lease, the provisions of this Lease shall control. The Rules and Regulations currently in effect are set forth in Exhibit C ; and

 

(d)           Tenant shall not abandon the Premises.

 

6.4          Extra Hazardous Use . Tenant covenants and agrees that Tenant will not do or permit anything to be done in or upon the Premises, or bring in anything or keep anything therein, which shall increase the rate of property or liability insurance carried by Landlord on the Premises or the Property above the standard rate applicable to Premises being occupied for the Permitted Use, unless Tenant agrees to pay such increase in insurance premiums. If the premium or rates payable with respect to any policy or policies of insurance purchased by Landlord or Landlord’s Managing Agent with respect to the Property increases as a result of any act or activity on or use of the Premises during the Term or payment by the insurer of any claim arising from any act or neglect of Tenant, or Tenant’s Agents, independent contractors or invitees, Tenant shall pay such increase, from time to time, within fifteen (15) days after demand therefor by Landlord, as Additional Rent.

 

6.5          Hazardous Materials .

 

(a)           As used herein each of the following terms shall have the meaning ascribed thereto:

 

(i)            “Hazardous Materials” shall mean each and every element, compound, chemical, mixture, contaminant, pollutant, material, waste or other substance which is defined, determined or identified as hazardous or toxic under any Environmental Law, including, without limitation, an “oil,” “hazardous waste,” “hazardous substance,” or “chemical substance or mixture,” as the foregoing terms (in quotations) are defined in Environmental Laws, as defined below.

 

(ii)           “Environmental Law” shall mean any federal, Commonwealth of Massachusetts and/or local Town of Hopkinton statute, ordinance, bylaw, code, rule and/or regulation now or hereafter enacted, pertaining to any aspect of the environment or

 

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human health, including, without limitation, the Comprehensive Environmental Response, Compensation and Liability Act of 1980, 42 U.S.C. §9601 et seq., the Resource Conservation and Recovery Act of 1976, 42 U.S.C. §6901 et seq., the Toxic Substances Control Act, 15 U.S.C. §2061 et seq., the Federal Clean Water Act, 33 U.S.C. §1251, and the Federal Clean Air Act, 42 U.S.C. §7401 et seq., and all environmental laws of the state in which the Property is located, including without limitation, Chapter 21C, Chapter 21D, and Chapter 21E of the General Laws of Massachusetts and the regulations promulgated by the Massachusetts Department of Environmental Protection.

 

(iii)          “Environmental Condition” shall mean any disposal, release or threat of release of Hazardous Materials on, from or about the Premises, the Buildings or the Property or storage of Hazardous Materials on, from or about the Premises, the Buildings or the Property.

 

(b)         Tenant may use, handle, treat, transport, store and dispose of Hazardous Materials related to its use of the Premises for the Permitted Use, provided that Tenant shall comply with all applicable Environmental Laws. Tenant shall give written notice to Landlord as soon as reasonably practicable of (i) any communication received by Tenant from any governmental authority concerning Hazardous Materials which relates to the Premises, the Buildings or the Property, and (ii) any Environmental Condition of which Tenant is aware.

 

(c)          Tenant shall indemnify, defend upon demand with counsel reasonably acceptable to Landlord, and hold Landlord harmless from and against, any liabilities, losses, claims, damages, interest, penalties, fines, Attorneys’ Fees (as defined below), experts’ fees, court costs, remediation costs, and other expenses which result from the use, storage, handling, treatment, transportation, release, threat of release or disposal of Hazardous Materials in or about the Premises or the Property by Tenant or Tenant’s Agents, independent contractors or invitees or by Zymark or Zymark’s Agents, independent contractors or invitees either prior to, during or after the Term of this Lease. As used in this Lease, the term “Attorneys’ Fees” means attorneys’, paralegals;, consulting and witness’ fees and disbursements, whether for in house counsel or outside counsel (including, without limitation, for attendance at hearings, depositions, and trials) and related expenses, including, without limitation, for lodging, meals, and transportation, together with all such costs and expenses incurred in connection with appellate proceedings.

 

(d)         Landlord shall indemnify, defend upon demand with counsel reasonably acceptable to Tenant, and hold Tenant harmless from and against, any liabilities, losses, claims, damages, interest, penalties, fines, Attorneys’ Fees (as defined above), experts’ fees, court costs, remediation costs, and other expenses which result from the use, storage, handling, treatment, transportation, release, threat of release or disposal of Hazardous Materials in or about the Premises or the Property by Landlord, or Landlord’s Agents or independent contractors, either prior to, during or after the Term of this Lease.

 

(e)          Landlord, on or prior to the date of this Lease, has provided Tenant with a copy of the most recent Phase I environmental report for the Property.

 

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Landlord in and to the Property or any portion thereof. To the maximum extent permitted by law, before such time as any contractor commences to perform the Initial Work or other Alterations, Tenant shall obtain from such contractor (and any subcontractors), and shall furnish to Landlord, a written statement acknowledging the provisions set forth in the immediately preceding sentence and, at Landlord’s request, Tenant shall, before commencing its Alterations, secure additional assurances satisfactory to Landlord in its reasonable discretion protecting Landlord against claims arising out of the furnishing of labor and materials for such Alterations. Tenant agrees to pay promptly when due the entire cost of any Alterations, and not to cause or permit any liens for labor or materials performed or furnished in connection therewith to attach to all or any part of the Property and to immediately discharge any such liens which may so attach. If, notwithstanding the foregoing, any lien is filed against all or any part of the Property for Alterations claimed to have been done for, or materials claimed to have been furnished to, Tenant or Tenant’s Agents or independent contractors, Tenant, at its sole cost and expense, shall cause such lien to be dissolved within twenty-five (25) days after receipt of notice that such lien has been filed, by the payment thereof or by the filing of a bond sufficient to accomplish the foregoing and shall deliver to Landlord evidence thereof within three (3) business days of such dissolution. Any notice by Landlord to Tenant shall refer to the obligation to comply within such twenty-five (25) day period. If Tenant fails to discharge any such lien within such time period, Landlord may, at its option, discharge such lien and treat the cost thereof (including Attorneys’ Fees incurred in connection therewith) as Additional Rent payable by Tenant upon demand, it being expressly agreed that such discharge by Landlord shall not be deemed to waive or release a Default of Tenant in not discharging such lien. Tenant shall indemnify and hold Landlord harmless from and against any and all expenses, liens, claims, liabilities and damages based on or arising, directly or indirectly, by reason of the making of any Alterations, which obligation shall survive the expiration or earlier termination of this Lease.

 

7.5          Intentionally Omitted .

 

7.6          Telecommunications . Tenant shall have the exclusive right to install, in accordance with Landlord’s roof installation requirements, telecommunications, HVAC, generators, and other mechanical devices on the roof of the Buildings in order to (a) serve Tenant’s needs, but such facilities shall not interfere in any way with the operations of any other tenants or occupants of the Park and shall not adversely affect any roof warranty and (b) shall comply with all provisions of this Article VII with respect to Alterations. Tenant shall further have the right to connect such facilities to available utilities and use shaft space to make the required connections. All of the foregoing shall be at Tenant’s sole cost and expense.

 

7.7          Building Expansions . Subject to the following provisions, Tenant shall have the right to expand at Tenant’s sole discretion, cost and expense, having the right to apply any portion of Landlord’s Contribution to such expansions if and when Tenant’s Termination Right has expired without exercise, (a) Building No. 68 by up to 5,400 rentable square feet in a single story (“Expansion 1”) and (b) Building No. 78 by (i) up to 10,600 rentable square feet in a single story (“Expansion 2”) and (ii) up to an additional 10,600 rentable square feet in a second story of the addition referenced in subsection (b)(i)  (“Expansion 3”) singularly, an “Expansion” and (collectively, the “Expansions” ). The Tenant’s rights to construct the Expansions shall be subject to (a) the availability of rights under all Applicable Law and all recorded documents affecting or governing the Park or any portion thereof or affecting title to the Property; (b)

 

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Tenant’s receipt of the following permits and approvals from the Town of Hopkinton to the extent required for Expansion 1 and Expansion 2 (collectively, the “Permits” ): (1) zoning board of appeal and/or planning board approval of modification of pre-existing, non-conforming Building No. 68 and (2) sewer connection permit (or approval of current or expanded septic system(s)) sufficient to service Expansion 1 and Expansion 2; and (c) Tenant’s payment of all costs related to design, permitting, approval, implementation and construction of any Expansions and all required parking areas and other improvements which are required therefor. Tenant shall make good faith efforts to obtain the Permits and shall diligently pursue such Permits and shall provide Landlord with copies of all applications and other submittals related thereto prior to or simultaneously with delivery to the appropriate official. In the event Tenant is denied one or more of the Permits (a “Denial” ), Tenant shall provide notice of such Denial to Landlord within five (5) days following such Denial. Landlord shall have the right but not the obligation to appeal such Denial to the applicable administrative or judicial entity and the right but not the obligation to prosecute such appeal through to completion at Landlord’s sole cost and expense except that Tenant agrees to cooperate in any such appeal with costs related to Tenant’s employees and consultants in connection therewith to be Tenant’s obligation (“Landlord’s Appeal Right”). In the event Tenant, despite using good faith efforts, cannot obtain the Permits, with applicable appeal periods expiring without appeal of an issued permit or approval (unless any such appeal is settled in favor of issuance of the permit or approval) by June 1, 2005 (the “Permit Target Date” ), Tenant shall have the right within ten (10) days thereafter, time being of the essence thereof, to terminate this Lease by written notice to the Landlord (“Tenant’s Termination Right”); however, any such notice shall not terminate this Lease if (A) Landlord successfully obtains all necessary, remaining Permits through exercise of Landlord’s Appeal Right or otherwise on or before December 31, 2005, in which case, the Expiration Date shall remain unchanged and Tenant’s exercise of Tenant’s Termination Right shall be null and void, but the dates for completion of the Initial Work, expenditure of the Landlord’s Contribution, the SS End Date, and the Initial Expiration Date shall all be extended on a day for day basis equivalent to the number of days between the Permit Target Date and the date on which Landlord successfully obtains the last of the Permits. In the event all necessary Permits are not obtained on or before December 31, 2005, then if Tenant has timely exercised Tenant’s Termination Right, the term of the Lease shall thereafter terminate and expire on December 31, 2006 (the “Modified Expiration Date” ) at which time this Lease shall terminate, Tenant shall surrender the Premises, as required in this Lease, all security deposits and letters of credit shall be returned as and when required by ARTICLE 18, and neither party shall have any further rights, responsibilities or obligations hereunder except provisions specifically stated to survive the expiration or earlier termination of this Lease. Landlord shall reasonably cooperate with Tenant in obtaining the Permits (and any permits for Expansion 3) by executing applications or documents authorizing Tenant to proceed before boards, attending hearings if necessary, and making land and/or additional parking spaces available on the Property, or on land then owned by Landlord which abuts, is adjacent to, or is in reasonable proximity with the Property, to comply with Applicable Law with respect to the Expansions, including, but not limited to floor area ratios, green space requirements, lot coverage requirements, and parking requirements; however, in no event shall Landlord be required to incur out-of-pocket costs or liability in connection with the Expansions or any of the foregoing matters related thereto or to limit its rights to further develop the Park as set forth below. Upon the construction of Expansions, Tenant shall have the right, at its sole cost and expense, to construct such parking spaces as

 

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aforesaid, as necessary to meet any municipal zoning parking requirements, in an area then owned by Landlord and reasonably designated by Landlord so long as such land abuts, is adjacent to, or in reasonable proximity with the Property, as local approvals may require them to be built. If any Expansion is constructed by Tenant, Base Rent during the Initial Term shall remain as set forth in Section 1.1. Upon the commencement of construction of any of the Expansions, such Expansions shall become part of the Premises for all purposes hereunder. Any further expansion of the Buildings (other than the Expansions) shall occur only upon a written amendment to this Lease as executed by Landlord and Tenant. The plans attached hereto as Exhibit A-1 depict the current proposal for the Expansions and parking area changes which are expected to be proposed to the Town of Hopkinton by Tenant.

 

Construction of the Expansions shall comply with all applicable provisions of this Lease, including without limitation, those relating to Alterations. The plans and specifications for the Expansions shall be subject to Landlord’s approval, which shall not be unreasonably withheld, conditioned or delayed, and the work shall be performed by a contractor or contractors approved by Landlord, which shall not be unreasonably withheld, conditioned or delayed.

 

Tenant acknowledges that Landlord may elect to obtain permits and/or construct additional buildings and/or building additions in the Park and that obtaining such permits and/or construction of the same may adversely affect Tenant’s ability to obtain permits and/or construct one or more of the Expansions because of the reduction of available land required to comply with zoning and other regulatory requirements. Notwithstanding the foregoing, Landlord agrees that Landlord will take no action to obtain, or to permit any other party to obtain, a building permit for any such additional building and/or building addition prior to January 1, 2006 if the same would have such an adverse effect.

 

ARTICLE 8
ASSIGNMENT AND SUBLETTING

 

8.1          Prohibition . Tenant covenants and agrees that, except as permitted herein, neither this Lease nor the estate hereby granted, nor any interest herein or therein, will be assigned (collaterally, conditionally or otherwise), mortgaged, pledged, encumbered or otherwise transferred, whether voluntarily, involuntarily, by operation of law or otherwise, and that neither the Premises nor the Property, nor any part thereof, will be encumbered in any manner by reason of any act or omission on the part of Tenant, or be sublet (which term, without limitation, shall include granting of concessions, licenses, use and occupancy agreements and the like) in whole or in part, without in each case, the prior written consent of Landlord, which shall not be unreasonably withheld, conditioned, or delayed provided that any such assignee or subtenant agrees directly with Landlord, by written instrument in form satisfactory to Landlord in its reasonable discretion, to be bound by all obligations of Tenant under this Lease (with respect only to the subleased premises in the case of a sublease), including without limitation, the covenant limiting assignment and subletting and containing such other provisions as are consistent with this Lease. Tenant further agrees that notwithstanding any assignment or sublet of any or all of Tenant’s interest in this Lease (irrespective of whether or not Landlord’s consent is required therefor), Tenant shall remain fully and primarily liable for the payment and performance of its obligations hereunder, and in the case of assignment such liability shall be joint and several with such assignee or assignees from time to time. Any consent by Landlord to

 

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a particular assignment, sublease or occupancy or other act, from time to time, for which Landlord’s consent is required pursuant to this ARTICLE 8, and any provision of this Lease which permits an assignment, sublease or occupancy or other act without Landlord’s consent shall not in any way diminish the prohibition stated in this Section 8.1 as to any such further assignment, sublease or occupancy or other act or the continuing liability of the original named Tenant or of any assignee from time to time. Assignment of the Lease or a sublease of all or a portion of the Premises to a parent, affiliate, or subsidiary of Tenant shall be permitted hereunder without the consent of Landlord. Any assignee or subtenant shall be obligated to enter into a written instrument in form satisfactory to Landlord in its reasonable discretion agreeing to be bound by all obligations of Tenant under this Lease (with respect only to the subleased premises in the case of a sublease), including without limitation, the covenant against further assignment and subletting.

 

8.2          Additional Events Deemed to be Assignment/Sublet . Without limiting the foregoing, each of the following events shall, for all purposes hereof, be deemed to be an assignment/sublet of this Lease and shall be subject to the provisions of this ARTICLE 8: (i) Tenant entering into any agreement pursuant to which a third party undertakes or is granted by or on behalf of Tenant the right to assign or attempt to assign this Lease or to sublet or attempt to sublet all or any portion of the Premises; (ii) the transfer (by one or more transfers) of a controlling portion of or interest in (meaning more than fifty percent (50%)) of the voting rights or stock or partnership or membership interests or other evidences of equity interests of Tenant; provided, however, that a transfer (i) of equity interests in Tenant on a nationally recognized public stock exchange, (ii) of all or a portion of the equity interest of Tenant to a parent, affiliate, or subsidiary of Tenant, (iii) of all or substantially all the equity interests of Tenant arising from a merger of Tenant with another entity or acquisition of Tenant by another entity, or (iv) of all or substantially all of the assets of Tenant to another entity shall not be deemed an assignment for which Landlord’s consent is required within the meaning of this ARTICLE 8.

 

8.3          Provisions Incorporated Into Sublease . Any sublease of all or a portion of the Premises shall be deemed to include the following provisions (notwithstanding any provision of the sublease to the contrary) and such provisions shall be deemed included in any Landlord consent agreement: (i) the term of the sublease must end no later than one day before the last day of the Term of this Lease; (ii) no sublease shall be valid, and no sublessee shall take possession of all or any part of the Premises until a fully executed counterpart of such sublease has been delivered to Landlord; (iii) such sublease is subject and subordinate to this Lease and the provisions hereof; and (iv) in the event of termination of this Lease for any reason or reentry or repossession of the Premises by Landlord, Landlord may, in its sole discretion and option, take over and assume all of the right, title and interest of Tenant, as sublessor under such sublease, whereupon, from and after notice thereof given by Landlord to such sublessee, such sublessee shall attorn to Landlord and pay rent and perform all obligations of such sublessee under such sublease for the full term of such sublease directly to Landlord, such sublease, from and after such notice, constituting a direct lease between Landlord and such sublessee; provided, however, that Landlord shall not (A) be liable for any previous act or omission of Tenant under such sublease; (B) be subject to any credit, claim, defense or offset previously accrued in favor of such sublessee against Tenant; (C) be bound by any previous modification of such sublease made without Landlord’s prior written consent or by any previous prepayment of more than one (1) month’s rent; or (D) be required to account for, or be responsible for, any security deposit not

 

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actually delivered to Landlord, and then, only to the extent not previously applied to amounts due. If a Default of Tenant occurs and Landlord elects to take over all of the right, title and interest of Tenant as sublessor under such sublease and to cause such sublessee to attorn to Landlord, all as provided above, then for the purposes of the foregoing provisions of this ARTICLE 8 only, by execution of a sublease, each such subtenant shall be deemed to have agreed that such subtenant and Landlord shall be in privity of contract with each other.

 

8.4         Collection of Rent . If Tenant assigns its interest under this Lease, or sublets or allows occupancy of the Premises or any part thereof by any party other than Tenant, whether or not in violation of the terms and conditions of this ARTICLE 8, Landlord may, at any time and from time to time, collect rent and other charges from any assignee and only from and after a Default of Tenant from any sublessee or occupant, and apply the net amount collected to the Rent and other charges herein reserved, but no such assignment, sublease, occupancy, collection or modification of any provisions of this Lease shall be deemed a waiver of this covenant, or the acceptance of the assignee, sublessee or occupant as a tenant or a release of Tenant from the payment and further performance of obligations on the part of Tenant to be performed hereunder.

 

8.5          Excess Payments . If Tenant assigns its interest under this Lease or sublets or otherwise permits occupancy of the Premises or any portion thereof, Landlord shall be entitled to an amount equal to fifty percent (50%) of all Profits (as defined below). As used herein, the term “Profits” means the amount, if any, by which (a) all compensation received by Tenant as a result of such assignment or sublease, or other occupancy, net of (a) reasonable expenses actually incurred by Tenant in connection with such assignment or sublease or other occupancy with such reasonable expenses to be amortized without interest over the remaining Term (or, with respect to fit-up costs, the useful life thereof, if greater than the remaining Term) (the “Amortized Costs” ) and (b) up to $1,600,000 in the aggregate of hard construction costs actually paid out of pocket by Tenant between the date hereof and December 31, 2005 only for Initial Work and work related to the Expansions (with evidence reasonably satisfactory to Landlord with respect to such actual out of pocket payments having been delivered to Landlord by December 31, 2006) as ratably amortized without interest over the remaining Term, specifically excluding Landlord’s Contribution and allowance under Section 5.2, and with such Amortized Costs and such excess payments to be recalculated upon any extension or renewal of the Term hereof, exceeds (b) in the case of an assignment, the Rent under this Lease, and in the case of a sublease or other occupancy, the portion of the Rent allocable to the portion of the Premises subject to such subletting or other occupancy. Together with Tenant’s notice and/or request for Landlord’s consent to such assignment or sublet, Tenant shall deliver to Landlord a schedule of anticipated Profits and a schedule of anticipated Amortized Costs. All payments due pursuant to this Section 8.5 shall be made on a monthly basis concurrently with Tenant’s payment of Basic Rent hereunder. Landlord shall have the right, upon five (5) days prior written notice to Tenant, to review Tenant’s books and records with respect to such excess payments at no out-of-pocket cost to Tenant. Notwithstanding the foregoing, the provisions of this Section 8.5 shall impose no obligation on Landlord to consent to any assignment/subletting/occupancy with respect to this Lease.

 

8.6          Payment of Landlord’s Costs . Tenant shall reimburse Landlord on demand, as Additional Rent, for any out-of-pocket costs (including reasonable Attorneys’ Fees and expenses) incurred by Landlord in connection with each actual or proposed assignment, sublease,

 

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occupancy agreement, or other act described in Section 8.1 or Section 8.2 or other request for approval or execution of any document whatsoever whether or not consummated, including without limitation, the costs of making investigations as to the acceptability of a proposed assignee, sublessee or occupant. Tenant shall have the right, upon five (5) days prior written notice to Landlord, to review Landlord’s books and records with respect to such out-of-pocket costs at no out-of-pocket cost to Landlord.

 

8.7          Conditions to Effectiveness of Assignment/Sublet . Any assignment, sublease or occupancy agreement shall not be valid or binding on Landlord and no assignee, sublessee or occupant shall take possession of all or any portion of the Premises unless and until (i) Tenant, Landlord and the assignee, sublessee, or occupant have each executed a consent agreement, in form and substance satisfactory to Landlord (which consent agreement shall provide, among other things, that said assignee, sublessee or occupant agrees to be independently bound by and upon all of the covenants, agreements, terms, provisions and conditions set forth in this Lease on the part of Tenant to be kept and performed, except in the event of a sublease of only a portion of the Premises, in which case such obligations shall only apply to the portion being sublet, and shall otherwise comply with this ARTICLE 8 ), (ii) Tenant has delivered to Landlord a fully executed counterpart of such assignment, sublease or occupancy agreement acceptable to Landlord, together with a final schedule of expected Profits and a final schedule of expected Amortized Costs, (iii) Tenant has paid to Landlord any sums required pursuant to Section 8.6 hereof, and (iv) Tenant has delivered to Landlord evidence (in the form of a certificate of insurance using Acord 27 or equivalent) of compliance by the assignee/sublessee with the insurance provisions of this Lease.

 

ARTICLE 9
MAINTENANCE, REPAIRS AND REPLACEMENTS

 

9.1          Landlord’s Obligations . Except as otherwise provided in this Lease, Landlord agrees to (i) keep the parking lots and driveways in good condition, properly lit, and reasonably free of snow and ice, (ii) keep and maintain all landscaped areas in the outdoor portions of the Property in a neat and orderly condition, (iii) maintain, repair and replace the Structure of the Buildings excluding the Alterations; provided, however, that Tenant (and not Landlord) shall be responsible with respect to any condition caused by or related to (A) any misconduct or neglect of Tenant, its Agents, invitees or independent contractors, or (B) the Alterations or Tenant’s Removable Property. As used herein, the term “Structure” means the exterior walls, load bearing portions of the walls, columns, beams, concrete slab, footings, structural beams of the roof, and all Landlord Utilities, as defined in Section  10.2 in each case as necessary to preserve the load bearing capacity thereof, Landlord also shall not be responsible for any maintenance, repair or replacement at the Premises other than as expressly set forth in this Section 9.1.

 

Provided Tenant complies with its repair and maintenance obligations under this Lease and its obligations under Section 5.2, Landlord shall, at its expense, make any necessary replacements of the roof and the rooftop HVAC units as required in Landlord’s reasonable determination, in the case of the roof, in order to maintain the roof in a watertight condition and, in the case of the rooftop HVAC units, to provide substantially the levels of heating, ventilating and air conditioning which the same provide as of the date hereof.

 

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All of the costs of Landlord pursuant to this ARTICLE 9 shall be included in Operating Expenses, including without limitation, capital replacements, as set forth in Exhibit B , Paragraph 6 unless specifically excluded from Operating Expenses pursuant to the provisions of Exhibit B .

 

Landlord shall never be liable for any failure to perform any of its maintenance, repair or replacement obligations under this Lease unless Tenant has given notice to Landlord of the need to perform the same, and Landlord fails to commence to perform the same within a reasonable time thereafter, or fails to proceed with reasonable diligence to complete such performance.

 

9.2         Tenant’s Obligations .

 

(a)           Except to the extent specifically required of Landlord under Section 9.1, Tenant will keep the Premises and every part thereof neat and clean including without limitation arranging for trash removal and disposal with respect thereto. Tenant further agrees to keep in good order, condition and repair (including replacement of) each and every part of the Premises, including without limitation, window glass, the roof (excluding the structural beams thereof and excluding the replacement of the roof to the extent that the same is Landlord’s obligation under Section 9.1 after the initial replacement thereof by Tenant under Section 5.2 ) and all Building Systems (excluding replacement of the rooftop HVAC units to the extent that the same is Landlord’s obligation under Section 9.1 ), and all Tenant Utilities, as defined in Section 10.2 and all other improvements at the Premises, and Tenant shall surrender the Premises to Landlord, at the end of the Term, in such condition, subject to normal wear and tear to carpeting and painted interior surfaces. Without limitation, Tenant shall comply with Applicable Law and the standards recommended by the local Board of Fire Underwriters applicable to Tenant’s use and occupancy of the Premises, and shall, at Tenant’s expense, timely obtain all permits, licenses and the like required thereby.

 

(b)           Tenant shall, at its sole cost and expense, obtain and at all times during the Term hereof maintain in full force and effect, a service contract in form and substance reasonably satisfactory to Landlord for the maintenance of the HVAC system serving the Premises, which service contract shall cover replacement of component parts, and Tenant shall deliver to Landlord a copy of such HVAC service contract promptly upon the execution hereof, but such requirement shall not be deemed to limit or otherwise affect Tenant’s obligation to maintain, repair and replace any supplemental HVAC equipment installed by Tenant, including without limitation, HVAC equipment for server rooms which shall be Tenant’s sole responsibility.

 

(c)             If either party is required to repair, replace or maintain any portion of the Buildings pursuant to the provisions of this Lease and fails to commence to perform such act within ten (10) Business Days’ after written notice from the other party, or fails to complete such act so commenced within thirty (30) days of said notice or such longer period as may be reasonably required so long as such work is being diligently conducted (except that no notice shall be required in the event of an emergency), the other party may perform such act (but shall not be required to do so), and in the case of Tenant failure, the provisions of Section 19.2(f) (“Remedying Defaults”) shall be applicable to the costs thereof, and in the case of Landlord failure, Landlord shall be responsible to reimburse Tenant for the costs of such work except to

 

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the extent that such costs would have been included in Operating Expenses. The party thereafter performing the work shall not be responsible to the party failing to perform the work for any loss or damage whatsoever that may accrue to such party’s stock or business or property by reason of properly performing such acts.

 

(d)           Tenant, shall, at its sole cost and expense, arrange and pay for cleaning and janitorial services for the Premises, substantially in accordance with the cleaning standards from time to time in effect for the Buildings.

 

ARTICLE 10
UTILITIES AND OTHER SERVICES

 

10.1        Heating, Ventilation and Air-Conditioning . Except as set forth in Section 9.1 above, Tenant and not Landlord shall furnish all heating and cooling for the Premises as required by Tenant for the comfortable occupancy thereof, but at a minimum Tenant shall furnish sufficient heating to the Premises to prevent any damage to the Property, including without limitation, the freezing of pipes.

 

10.2        Utilities .

 

(a)           General . Landlord shall be responsible for the following (collectively, the “Landlord Utilities” ): all electricity, natural gas (if any), water, and septic service lines from the property line of the Park up to their entry point into the Buildings (the “Utility Switching Points” ), and Tenant shall be responsible for such utilities from the Utility Switching Points into and throughout the Premises and for all oil supplies, telecommunications and other utility services, modifications made to the Landlord Utilities after the date hereof, and any new utilities, including without limitation, sewer service, installed after the date hereof (collectively, “Tenant Utilities” ). All utility services shall be separately metered, and Tenant shall pay all charges therefor directly to the utility provider. Notwithstanding the foregoing, electrical service for the Premises shall also be governed by the provisions of subsections (b), (c), and (d)  below.

 

(b)           Electricity; Arrangement/Metering . Tenant shall pay all charges for utilities directly to the utility provider. Upon prior notice and approval by Landlord, Tenant may supplement and/or modify Landlord’s existing wires, risers, conduits and other electrical equipment of Landlord serving the Premises. Any additional feeders or risers to supply Tenant’s, or any subtenant’s, electrical requirements in addition to those originally installed and all other equipment proper and necessary in connection with such feeders or risers, shall be installed by and at the sole cost and expense of Tenant, provided that such additional feeders and risers are permissible under Applicable Law and insurance regulations and the installation of such feeders or risers will not cause permanent damage or injury to the Buildings or cause or create a dangerous condition or unreasonably interfere with other tenants of the Buildings. Tenant agrees that it will not make any material alteration or material addition to the electrical equipment and/or appliances in the Premises without the prior written consent of Landlord, which consent will not be unreasonably withheld, conditioned or delayed.

 

(c)           Capacity . Tenant warrants and represents to Landlord that its electrical demand requirement shall not adversely affect the Buildings’ electrical system. Tenant’s use of

 

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electrical energy in the Premises shall not at any time exceed the maximum capacity permitted from time to time under Applicable Law or the capacity of any of the electrical conductors and equipment in or otherwise serving the Premises and Tenant shall repair any damage caused by Tenant’s failure to observe such requirements. Any additional feeders or risers necessary to supply electricity to the Premises in addition to those originally installed and all other equipment proper and necessary in connection with such feeders or risers, shall be installed by Tenant at its sole cost and expense, provided that such additional feeders and risers and other equipment are permissible under Applicable Law and insurance regulations and the installation of such feeders or risers will not cause permanent damage or injury to the Buildings or cause or create a dangerous condition. Tenant agrees that it will not make any material alteration or material addition to the electrical equipment and/or appliances in the Premises without the prior written consent of Landlord, which consent shall not be unreasonably withheld, conditioned or delayed.

 

(d)           No Landlord Liability . Landlord shall not be liable in any way to Tenant for any failure or defect in the supply or character of electrical energy furnished to the Premises by reason of any requirement, act or omission of the public or other utility serving the Buildings with electricity unless due to the act or omission of Landlord or Landlord’s Agents or independent contractors. Landlord shall not be liable or responsible to Tenant for any loss, damage or expense that Tenant may sustain or incur if the quantity, character or supply of electrical energy is changed or is no longer available or suitable for Tenant’s requirements.

 

(e)           Interruption of Service . Landlord reserves the right to curtail, suspend, interrupt and/or stop the supply and/or flow of water, sewage, electrical current, and other services, and to curtail, suspend, interrupt and/or stop use of entrances and/or lobbies serving as access to the Buildings, or other portions of the Property, provided that, except in the event of any emergency, Landlord shall provide Tenant with at least seven (7) days prior notice before taking any such action, without thereby incurring any liability to Tenant, when necessary or advisable, in Landlord’s judgment, by reason of accident or emergency, or for repairs, alterations, replacements or improvements necessary or advisable, in Landlord’s judgment, or when prevented from supplying such services or use due to any act or neglect of Tenant or Tenant’s Agents, invitees or independent contractors or any person claiming by, through or under Tenant or by