<PAGE>
EXHIBIT 10.63
LEASE
BETWEEN
BELLINGHAM MECHANIC, LLC
A MASSACHUSETTS LIMITED LIABILITY COMPANY
LANDLORD,
AND
99 COMMISSARY LLC
A DELAWARE LIMITED LIABILITY COMPANY
TENANT
AND
O'CHARLEY'S INC.
A TENNESSEE CORPORATION
GUARANTOR
<PAGE>
TABLE OF CONTENTS
<TABLE>
<S>
<C>
1. USE AND RESTRICTIONS
ON USE................. 1
2.
TERM........................................ 2
3.
RENT........................................ 3
4. ADDITIONAL
RENT............................. 5
5. TENANT'S RIGHT TO
TERMINATE................. 8
6. LANDLORD'S
WORK/ALTERATIONS................. 8
7.
REPAIR...................................... 10
8.
LIENS....................................... 11
9. ASSIGNMENT AND
SUBLETTING................... 11
10.
INDEMNIFICATION............................. 13
11.
INSURANCE................................... 13
12. WAIVER OF
SUBROGATION....................... 14
13. SERVICES AND
UTILITIES...................... 14
14. HOLDING
OVER................................ 15
15.
SUBORDINATION............................... 15
16. RULES AND
REGULATIONS....................... 15
17. REENTRY BY
LANDLORD......................... 15
18.
DEFAULT..................................... 16
19.
REMEDIES.................................... 17
20. TENANT'S BANKRUPTCY OR
INSOLVENCY........... 20
21. QUIET
ENJOYMENT............................. 21
22. DAMAGE BY FIRE,
ETC......................... 21
23. EMINENT
DOMAIN.............................. 22
24. SALE BY
LANDLORD............................ 23
25. ESTOPPEL
CERTIFICATES....................... 23
26. SURRENDER OF
PREMISES....................... 23
27.
NOTICES..................................... 24
28. DEFINED TERMS AND
HEADINGS/FORCE MAJEURE.... 24
29. TENANT'S
AUTHORITY.......................... 25
30.
COMMISSIONS................................. 25
31. TIME AND APPLICABLE
LAW..................... 25
32. SUCCESSORS AND
ASSIGNS...................... 25
33. ENTIRE
AGREEMENT............................ 25
34. EXAMINATION NOT
OPTION...................... 25
35.
RECORDATION................................. 25
36. LIMITATION OF LANDLORD'S
LIABILITY.......... 25
37.
ACCESS...................................... 26
38. LANDLORD'S COMPLIANCE WITH
LAWS............. 26
39.
SIGNAGE..................................... 26
</TABLE>
EXHIBIT A - PREMISES
EXHIBIT A-1 - LAND
EXHIBIT B - LANDLORD'S IMPROVEMENTS
EXHIBIT C - MODIFIED SITE PLAN
EXHIBIT D - FORM OF SNDA
EXHIBIT E - RULES AND REGULATIONS
EXHIBIT F - FORM OF GUARANTY
i
<PAGE>
REFERENCE PAGES
BUILDING:
1-8 Mechanic Street
Bellingham, Massachusetts 02019
LANDLORD:
BELLINGHAM MECHANIC, LLC, a
Massachusetts limited liability company
LANDLORD'S ADDRESS: 800
Technology Center Drive, Stoughton,
MA 02072
LEASE REFERENCE DATE: December 13, 2004
TENANT:
99 COMMISSARY LLC,
a Delaware limited liability company
TENANT'S ADDRESS:
3038 Sidco Drive
Nashville, TN 37204
Attn: Gregory L. Burns, Chairman and CEO
Tel.: 615-256-8500
Fax: 615-782-5030
With a copy to:
Ninety-Nine Restaurant & Pub
160 Olympia Avenue
Woburn, MA 01804
Attn: Executive Vice President of Real
Estate
Tel. 781-933-8999
Fax: 781-933-0821
and
Joseph R. Tarby, III, Esq.
Murtha Cullina LLP
600 Unicorn Park Drive
Woburn, MA 01801
Tel. 781-933-5505
Fax: 781-933-1530
i
<PAGE>
PREMISES
The warehouse and office and showroom areas shown as
IDENTIFICATION:
"NINETY-NINE" on the plan attached hereto as Exhibit A
("Plan") in the building ("Building") commonly known
as the Bellingham Business Center and numbered as [1-8]
Mechanic Street, Bellingham, Massachusetts, together
with the use, in common with others, of any common
areas of the Building, including, but not limited to,
entryways, sidewalks, driveways and parking areas. The
Building has 239 parking spaces available, or 1.13
parking spaces per 1,000 rentable square feet of the
Building. The land ("Land") upon which the Building is
located the Building and the parking spaces are shown
on Exhibit A-1 attached hereto.
PREMISES RENTABLE
Approximately 78,000 sq. ft. (determined by Landlord's
AREA:
architect, after completion of perimeter walls, using
ANSI/BOMA Z65.1 - 1996 Standard).*
PERMITTED USE:
Storage, office, processing of food products,
distribution of restaurant goods and supplies and
related products and uses ancillary thereto. SCHEDULED
DELIVERY DATE: July 25, 2005 (or on such earlier date
as Landlord can complete Landlord's Work)
DELIVERY DATE:
The date established under Section 2.1.
RENT COMMENCEMENT
The date established under Section 2.2.
DATE
TERM OF LEASE:
Ten (10) years plus any fraction of a month in which
the Delivery Date
shall occur if-the Delivery Date
shall not occur on the first day of the month (unless
sooner terminated pursuant to the Lease).
TERMINATION DATE:
Subject to the provisions of this Lease, the date (at
5:00 p.m.) which is 120 months, plus any fraction of a
month at the commencement of the Term, from the
Delivery Date
ii
<PAGE>
OPTION(S) TO EXTEND: Two (2) option
to extend the Term for five (5) years,
as set forth in Section 2.4
<TABLE>
<CAPTION>
Annual Rent
Monthly Installments
-----------
--------------------
<S>
<C>
<C>
ANNUAL RENT (ARTICLE 3):
YEARS 1 THROUGH 5
$687,960*
$57,330*
YEARS 6 THROUGH 10
$726,960*
$60,580*
</TABLE>
TENANT'S PROPORTIONATE SHARE:
37.14%*
BUILDING RENTABLE AREA:
210,000 square feet
LANDLORD'S CONSTRUCTION
William Conroy
REPRESENTATIVE:
TENANT'S CONSTRUCTION
Thomas Williams
REPRESENTATIVE:
REAL ESTATE BROKER(S) DUE
Richards Barry Joyce & Partners and
COMMISSION:
Colebrook Realty Services, Inc.
The Reference Page information is
incorporated into and made a part of the
Lease. In the event of any conflict between
any Reference Page information and
the Lease, the Lease shall control. This
Lease includes Exhibits A through F all
of which are made a part of this Lease.
LANDLORD:
TENANT:
BELLINGHAM MECHANIC, LLC
99 COMMISSARY LLC
By: /s/
By:
/s/ Gregory L. Burns
-------------------------
--------------------------------------
Title: Manager
Title: Chief Manager/President
Dated: December 17, 2004
Dated: December 16, 2004
*Subject to possible adjustment per above
measurement of Premises
iii
<PAGE>
LEASE
By this
Lease Landlord leases to Tenant and Tenant leases from Landlord
the Premises described on the Reference
Page. The Reference Page, including all
terms defined thereon, is incorporated as
part of this Lease.
1. USE AND RESTRICTIONS ON USE.
1.1 The
Premises are to be used solely for the Permitted Use stated on
the
Reference Page. Tenant shall not do or
permit anything to be done in or about
the Premises which will be used for any
unlawful purpose. Tenant shall not do,
permit or suffer in, on, or about the
Premises, the commission of any waste.
Tenant shall comply with all governmental
laws, ordinances and regulations
applicable to the use of the Premises and
its occupancy and shall promptly
comply with all governmental orders and
directions for the correction,
prevention and abatement of any violations
in or upon, or in connection with,
the Premises, all at Tenant's sole expense,
but excluding those responsibilities
of Landlord pursuant to Sections 6.1, 7.1
and 38 hereof. Tenant shall not do or
permit anything to be done on or about the
Premises or bring or keep anything
into the Premises which will in any way
increase the rate of, invalidate or
prevent the procuring of any insurance
protecting against loss or damage to the
Building or any of its contents by fire or
other casualty or against liability
for damage to property or injury to persons
in or about the Building or any part
thereof.
1.2 Tenant
shall not, and shall not direct, suffer or permit any of its
agents, contractors, employees, licensees
or invitees to at any time handle,
use, manufacture, store or dispose of in or
about the Premises or the Building
any (collectively "Hazardous Materials")
flammables, explosives, radioactive
materials, hazardous wastes or materials,
toxic wastes or materials, or other
similar substances, petroleum products or
derivatives or any substance subject
to regulation by or under any federal,
state and local laws and ordinances
relating to the protection of the
environment or the keeping, use or disposition
of environmentally hazardous materials,
substances, or wastes, presently in
effect or hereafter adopted, all amendments
to any of them, and all rules and
regulations issued pursuant to any of such
laws or ordinances (collectively
"Environmental Laws"), nor shall Tenant
suffer or permit any Hazardous Materials
to be used in any manner not fully in
compliance with all Environmental Laws, in
the Premises or the Building and
appurtenant land or cause the environment to
become contaminated with any Hazardous
Materials. Notwithstanding the foregoing,
Tenant may (i) handle, store, use or
dispose of products containing small
quantities of Hazardous Materials (such as
aerosol cans containing insecticides,
toner for copiers, solvents, paints, paint
remover and the like) to the extent
customary and necessary for the use of the
Premises for general office purposes
and in connection with the Permitted Use;
(ii) provide on-site, mobile fueling
for Tenant's vehicles, subject to any
approvals which may be required by the
Town of Bellingham, and (iii) wash its
vehicles, subject to any necessary
approvals from the Town of Bellingham; in
each case provided that Tenant shall
always handle, store, use, and dispose of
Hazardous Materials in a safe and
lawful manner and never allow such
Hazardous Materials to contaminate the
Premises, Building or appurtenant land or
the environment in violation of
Environmental Laws. Tenant shall protect,
defend, indemnify and hold each and
all of the Landlord Entities (as defined in
costs and reasonable attorney's
fees) incurred by reason of any failure of
Tenant to fully comply with all
applicable Environmental Laws, or the
presence, handling, use or disposition in
or from
<PAGE>
the Premises of any Hazardous Materials
(even though permissible under all
applicable Environmental Laws or the
provisions of this Lease) caused by Tenant
or its agents or invitees except to the
extent of Landlord's obligations
pursuant to Section 38 hereof, or by reason
of any failure of Tenant to keep,
observe, or perform any provision of this
Section 1.2. Landlord represents that
the Land is currently free of environmental
contamination (and in compliance
with all Environmental Laws) and shall
indemnify Tenant and be responsible for
any costs of remediation of any
environmental contamination, should any be
discovered to have been existing at the
Land as of the date hereof.
1.3
Landlord shall provide Tenant, as appurtenant to the Premises
and
without extra charge, (i) with the use, in
common with others in the Building,
of the common area parking servicing the
Premises which is a ratio of at least
1.13 parking spaces for each 1,000 rentable
square feet of the Building. Tenant
shall have truck access to drive around the
Building and park at its loading
docks. Landlord agrees to proceed as soon
as possible and to use diligent
efforts to obtain a modification to the
site plan approval and any other permits
necessary to change the truck parking as
shown on the Modified Site Plan
attached hereto as Exhibit C and shall
allow Tenant the opportunity to
participate in this process.
2. TERM.
2.1 The
Term of this Lease shall begin on the delivery date ("Delivery
Date") which shall be the later to occur of
(a) the Scheduled Delivery Date
shown on the Reference Page, and (b) the
date when Landlord shall tender
possession of the Premises to Tenant with
Landlord's Work described on Exhibit B
attached hereto substantially completed
(but for punch list items that do not
materially interfere with Tenant's ability
to use the Premises for the Permitted
Use) and all mechanical, plumbing and
utility systems in working order and
available for Tenant's immediate use, and
Landlord shall have provided Tenant
with a certificate of occupancy (or
temporary certificate of occupancy) from the
Town of Bellingham, Massachusetts with
respect to the Premises. Landlord agrees
to use reasonable and diligent efforts to
obtain a certificate of occupancy and
deliver the Premises to the Tenant. As soon
as it shall be determined, Landlord
and Tenant shall execute a memorandum in
recordable form setting forth the
actual Delivery Date and Termination Date.
In the event the Delivery Date shall
not have occurred by August 25, 2005 for
any reason other than the fault of
Tenant, Tenant shall receive a credit
against its first rental payments due
hereunder at the rate of $1,884.82 for each
two (2) days by which the Delivery
Date is extended beyond August 25, 2005. If
the Delivery Date shall not have
occurred by September 25, 2005 for any
reason other than the fault of Tenant,
Tenant shall receive a credit against its
first rental payment due hereunder at
the rate of $1,884.82 for each day by which
the Delivery Date is extended beyond
September 25, 2005. If the Delivery Date
shall not have occurred on or before
December 10, 2005, Tenant shall have the
right to terminate this Lease upon ten
(10) days written notice to Landlord.
2.2
Notwithstanding any provision of this Lease to the contrary,
Annual
Rent and all other charges due under this
Lease shall begin on the Rent
Commencement Date which shall be the
Delivery Date.
2.3 After
the Lease Reference Date, and only after Landlord's prior
consent and scheduled so as not to
interfere with Landlord's Work at least four
(4) weeks prior to the
2
<PAGE>
Delivery Date, Landlord shall afford Tenant
reasonable access to the Premises in
order for Tenant to install
telecommunication (which may include a satellite
dish(es) upon the roof of the Building,
where designated by Landlord, at
Tenant's expense and responsibility for any
damage which the installation or
maintenance of the same may cause to the
roof of the Building) and computer
wiring and equipment and other furniture,
fixtures, warehouse racking and
equipment. In the event Landlord shall
permit Tenant to occupy the Premises
prior to the Delivery Date, such occupancy
shall be subject to all the
provisions of this Lease other than the
payment of Rent and Additional Rent and
shall not advance the Termination Date.
2.4 Option
to Extend. Tenant shall have two (2) options to extend the Term
for a period of five (5) years each
following the end of the existing Term, so
long as no uncured Event of Default by
Tenant exists during the period from the
time of the exercise of this option until
the end of the Term. Such options may
be exercised by notice from Tenant to
Landlord given not less than twelve (12)
months prior to the expiration of the Term.
Upon the giving of such notice, this
Lease and the Term hereof shall
automatically be extended for five (5) years
without the necessity for the execution of
any other instrument in confirmation
thereof except for a document memorializing
the Annual Rent established as set
forth in Section 3.3 below for the extended
Term and an amended notice of lease
to be signed by the parties suitable for
recording that Tenant may register or
record at its cost and expense. Except for
the rent payable during the option
period, which shall be determined in the
manner provided in Section 3.3 below,
and the fact that there shall be no further
option to extend, each extension
shall be upon all the same terms,
conditions and provisions as contained in this
Lease. Whenever the context shall not be
inconsistent therewith, references in
this Lease to the Term hereof shall be
deemed to include the option period for
which the original Term shall then be so
extended.
2.5
Contiguous Space Expansion Option. Landlord agrees that it will
not,
during the Term of this Lease, lease any
space in the Building which is
contiguous to the Premises ("Contiguous
Space") without first offering the same
to Tenant upon the same terms and
conditions as Landlord would be willing to
lease to a third party. If Landlord intends
to lease Contiguous Space, Landlord
shall first provide written notice of such
terms and conditions to Tenant
("Landlord Notice") and Tenant shall have a
period of ten (10) days from receipt
of Landlord's Notice within which to agree
to lease such Contiguous Space upon
the exact same terms and conditions as set
forth in Landlord's Notice. If Tenant
shall notify Landlord of its desire to
lease the Contiguous Space within such
ten (10) day period, then this Lease shall
be modified to include the Contiguous
Space upon the same terms and conditions as
set forth in this Lease, except as
the same may be modified with respect to
the Contiguous Space by the terms set
forth in Landlord's Notice. If Tenant shall
fail to accept the offer contained
in Landlord's Notice within such ten (10)
day period, then Landlord shall be
free to lease the Contiguous Space to a
third party on terms and conditions no
more favorable to any third party than
those set forth in Landlord's Notice.
3. RENT.
3.1 Tenant
agrees to pay to Landlord the Annual Rent in effect from time
to time by paying the Monthly Installment
of Rent then in effect on or before
the first day of each full calendar month
during the Term, except that the first
month's rent shall be paid upon the
Delivery Date. The Monthly Installment of
Rent in effect at any time shall be
one-twelfth of the
3
<PAGE>
Annual Rent in effect at such time. Rent
for any period during the Term which is
less than a full month shall be a prorated
portion of the Monthly Installment of
Rent based (except as otherwise set forth
in this Lease) upon a thirty (30) day
month. Said rent shall be paid to Landlord,
without deduction or offset and
without notice or demand, except as may be
required by Section 19.7, at the
Landlord's address, as set forth on the
Reference Page, or to such other person
or at such other place as Landlord may from
time to time designate in writing.
3.2 Tenant
recognizes that late payment of any rent or other sum due under
this Lease will result in administrative
expense to Landlord, the extent of
which additional expense is extremely
difficult and economically impractical to
ascertain. Tenant therefore agrees that if
rent or any other sum is not paid
within seven (7) days of the date when due
and payable pursuant to this Lease, a
late charge shall be imposed in an amount
equal to four percent (4%) of the
unpaid rent or other payment. The amount of
the late charge to be paid by Tenant
shall be reassessed and added to Tenant's
obligation for each successive monthly
period until paid. The provisions of this
Section 3.2 in no way relieve Tenant
of the obligation to pay rent or other
payments on or before the date on which
they are due, nor do the terms of this
Section 3.2 in any way affect Landlord's
remedies pursuant to Article 19 in the
event said rent or other payment is
unpaid after date due.
3.3 If
Tenant shall extend the Term pursuant to Section 2.4 above,
Tenant
shall pay Annual Rent during each extension
of the Term equal to the greater of
(a) Market Rent, as defined below, or (b)
the Annual Rent in effect upon the
last day of the Term existing prior to the
extension period in question.
"Market
Rent" shall be computed for the option period at the then
effective current rentals being charged to
new tenants in buildings of
comparable type, build-out and quality to
that of the Premises, in the same
rental market area as that of the Premises,
taking into account and giving
effect to, in determining comparability,
without limitation, such considerations
as size, location of premises, lease term,
whether or not there will be a
brokerage commission charged, and Real
Estate Tax and Operating Expense charges
to the tenant.
Landlord
and Tenant shall use best efforts to agree on the Market Rent
no
later than thirty (30) days after Landlord
receives Tenant's notice of its
intent to extend the Term. In the event
Landlord and Tenant cannot so agree,
Landlord shall provide Tenant with notice
as to its designation of Market Rent
("Landlord's Designation") for the five
year option period in question no later
than thirty (30) days after receiving
Tenant's notice of its intention to extend
the Term and shall furnish comparable data
in support of such designation. If
Tenant disagrees with Landlord's
Designation of the Market Rent, then Tenant
shall have the right, by written notice
given within thirty (30) days after
Tenant's receipt of Landlord's Designation
("Tenant's Arbitration Notice"), to
submit the determination of Market Rent to
arbitration as follows. Market Rent
shall be determined by appraisers, one to
be chosen by Tenant, one to be chosen
by Landlord, and a third to be selected, if
necessary, as below provided. All
appraisers selected under this paragraph
shall be experienced, M.A.I. real
estate appraisers with at least 10 years
experience with properties in the
Greater Boston Area and shall not have been
employed by the party choosing such
appraiser in the prior five (5) years.
Within twenty-one (21) days after
Tenant's Arbitration Notice, the parties
shall each designate its own appraiser
and notify the other of its chosen
appraiser. Unless such two appraisers shall
have reached a unanimous
4
<PAGE>
decision within thirty (30) days after
their designation, then they shall so
notify the then President of the Greater
Boston Real Estate Board and request
him or her to select an impartial third
appraiser to act hereunder. Such third
appraiser shall receive submittals of the
determination of Market Rent from each
of Landlord's and Tenant's appraisers with
accompanying data to support their
determination. Within fifteen (15) days
after receipt of such information from
Landlord's and Tenant's appraisers, the
third appraiser shall determine Market
Rent only by selecting one or the other of
the two appraisals without
modification. The decision of the third
appraiser as to which appraisal the
third appraiser believes to be closest to
Market Rent shall be final and binding
upon the parties. Landlord and Tenant shall
each bear the expense of their own
appraiser and shall bear the expense of the
third appraiser (if any) equally.
4. ADDITIONAL RENT.
4.1 This
Lease is a so-called "triple net" lease. For the purpose of
this
Article 4, the following terms are defined
as follows:
4.1.1 LEASE YEAR: Each calendar year falling partly or wholly
within
the Term.
4.1.2 OPERATING EXPENSES: All direct costs of operation,
maintenance, repair and management of the
Building (excluding all equipment
related to Tenant's HVAC and refrigeration
and freezer areas which shall be at
Tenant's sole expense), as determined in
accordance with generally accepted
accounting principles, including the
following costs by way of illustration, but
not limitation: water and sewer charges;
insurance charges of or relating to all
insurance policies and endorsements deemed
by Landlord to be reasonably
necessary or desirable and relating in any
manner to the protection,
preservation, or operation of the Building
or any part thereof; utility costs,
including, but not limited to, the cost of
heat, light, power, steam, gas, and
waste disposal (but not the wiring of
electricity to the Premises or to any
other tenant space); the cost of security
and alarm services (including any
central station signaling system); window
cleaning costs; maintenance labor
costs; costs and expenses of managing the
Building, including a management fee
not to exceed three (3%) percent of the
gross annual income of the Building;
heating, ventilation and air conditioning
maintenance costs; material costs;
equipment costs including the cost of
maintenance, repair and service agreements
and rental and leasing costs; purchase
costs of equipment other than capital
items; tool costs; licenses, permits and
inspection fees; wages and salaries;
employee benefits and payroll taxes;
accounting fees; any sales, use or service
taxes incurred in connection therewith.
Operating Expenses shall not include
janitorial services, which are to be
provided by Tenant to the Premises,
depreciation or amortization of the
Building or equipment in the Building except
as provided herein, loan principal
payments, costs of alterations of tenants'
premises, leasing commissions, interest
expenses on long-term borrowings,
advertising costs or management salaries
for executive personnel, all costs and
expenses incurred in connection with
leasing space in the Building, including,
but not limited to, advertising and
promotional expenses and real estate
brokerage commissions; legal fees incurred
in leasing or in disputes with
tenants; cost of construction allowances
provided to other tenants; interest or
principal payments on any mortgage or deed
of trust or any ground lease payments
or any other financing costs or fees; any
cost or expenditure for which Landlord
is reimbursed; costs of any services
furnished to other tenants but which
Landlord does not make available to Tenant
or is available to Tenant only for an
additional direct charge; any expense
resulting from the negligence of Landlord,
its agents,
5
<PAGE>
contractors or employees; costs recoverable
by Landlord under its insurance
policies; costs resulting from defects in
the design or construction of the
Building; cost of construction of new
tenant or common area space in the
Building; attorneys fees, costs and
disbursements incurred in connection with
matters relating to the formation of
Landlord as an entity and maintaining its
continued existence as an entity; or costs
resulting from Landlord's breach of
this Lease or imposed upon Landlord by any
governmental authority as a result of
the violation of any law, statute or
ordinance by Landlord or its agents or
employees. In addition, Landlord shall be
entitled to amortize and include as an
additional rental adjustment: (i) an
allocable portion of the cost of capital
improvement items which are reasonably
calculated to reduce Operating Expenses;
(ii) fire sprinklers and suppression
systems and other life safety systems
required by changes in the law after the
commencement of the Term; and (iii)
other capital expenses which are required
under any governmental laws,
regulations or ordinances which were not
applicable to the Building at the time
it was constructed. All such costs shall be
amortized over the reasonable life
of such improvements in accordance with
such reasonable life and amortization
schedules as shall be determined by
Landlord in accordance with generally
accepted accounting principles, with
interest on the unamortized amount at one
percent (1%) in excess of the prime lending
rate announced from time to time as
such by Bank of America, N.A. Landlord
estimates that the initial Operating
Expenses shall be approximately
$1.50/square foot, based upon similar buildings
which Landlord owns or manages.
4.1.3 TAXES: Real estate taxes and any other taxes, charges and
assessments which are levied with respect
to the Land and Building, or with
respect to any improvements, fixtures and
equipment or other property of
Landlord, real or personal, located in the
Building and used in connection with
the operation of the Building and said
Land, any payments to any ground lessor
in reimbursement of tax payments made by
such lessor; and all reasonable fees,
expenses and costs incurred by Landlord in
investigating, protesting, contesting
or in any way seeking to reduce or avoid
increase in any assessments, levies or
the tax rate pertaining to any Taxes to be
paid by Landlord in any Lease Year.
Landlord agrees to seek an abatement of
Taxes if requested to do so by tenants
occupying at least 51% of the Building
(including the Premises), provided, if so
requested, any cost of obtaining the same
will be borne by the Tenants of the
Building in their respective Proportionate
Shares. If Landlord secures an
abatement or refund of any Taxes, Tenant
shall receive its proportionate share
of the amount of such abatement or refund
(i.e., the net amount remaining after
paying all reasonable costs and expenses of
securing the abatement or refund,
including reasonable attorneys' fees) as a
credit to be applied by Landlord
against rent next becoming due (or, if no
further rent is due from Tenant, by a
cash payment by Landlord to Tenant).
Landlord's obligation to pay such abatement
or refund to Tenant shall survive the
expiration or termination of this Lease.
Taxes shall also include any substitute or
additional tax on real estate or the
profits therefrom, whether or not now
customary or within the contemplation of
the parties to this Lease: (a) upon,
allocable to, or measured by or on the
gross or net rent payable under this Lease,
including without limitation any
gross income tax or excise tax levied by
the State, any political subdivision
thereof, or the Federal Government with
respect to the receipt of such rent; (b)
upon or with respect to the possession,
leasing, operation, management,
maintenance, alteration, repair, use or
occupancy of the Premises or any portion
thereof, including any sales, use or
service tax imposed as a result thereof;
(c) upon or measured by the Tenant's gross
receipts or payroll or the value of
Tenant's equipment, furniture, fixtures and
other personal property of Tenant or
leasehold improvements, alterations or
additions located in the Premises; or (d)
upon this transaction or any document to
which Tenant
6
<PAGE>
is a party creating or transferring any
interest of Tenant in this Lease or the
Premises. In addition to the foregoing,
Tenant agrees to pay, before
delinquency, any and all taxes levied or
assessed against Tenant and which
become payable during the term hereof upon
Tenant's equipment, furniture,
fixtures and other personal property of
Tenant located in the Premises. Taxes
shall not include any corporate franchise,
or estate, inheritance, succession,
transfer, gift, profit or net income tax or
capital levy, or tax imposed upon
any transfer by Landlord of its interest in
this Lease or the Building.
4.2 Tenant
shall pay as additional rent for each Lease Year Tenant's
Proportionate Share of Operating Expenses
and Taxes incurred for such Lease
Year.
4.3 The
annual determination of Operating Expenses shall be made by
Landlord and shall be binding upon Landlord
and Tenant (subject to Tenant's
rights pursuant to Section 4.7 below).
Tenant may review the books and records
supporting such determination in the office
of Landlord, or Landlord's agent,
during normal business hours, upon giving
Landlord five (5) days advance written
notice within ninety (90) days after
receipt of such determination, and in no
event more often than once in any one year
period.
4.4 Prior
to the actual determination thereof for a Lease Year, Landlord
may from time to time (but in no event more
often than once in any one year
period) estimate Tenant's liability for
Operating Expenses and/or Taxes under
Section 4.2. Landlord will give Tenant
written notification of the amount of
such estimate and Tenant agrees that it
will pay, by increase of its Monthly
Installments of Rent due in such Lease
Year, additional rent in the amount of
such estimate. Any such increased rate of
Monthly Installments of Rent pursuant
to this Section 4.4 shall remain in effect
until written notification to Tenant
of the actual Operating Expenses pursuant
to Section 4.3 above.
4.5 When
the above mentioned actual determination of Tenant's liability
for Operating Expenses and/or Taxes is made
for any Lease Year and when Tenant
is so notified in writing, then:
4.5.1 If the total additional rent Tenant actually paid pursuant
to
Section 4.4 on account of Operating
Expenses and/or Taxes for the Lease Year is
less than Tenant's liability for Operating
Expenses and/or Taxes, then Tenant
shall pay such deficiency to Landlord as
additional rent in one lump sum within
thirty (30) days of receipt of Landlord's
bill therefore (irrespective as to
whether such bill shall have been rendered
after Tenant shall no longer occupy
the Premises); and
4.5.2 If the total additional rent Tenant actually paid pursuant
to
Section 4.4 on account of Operating
Expenses and/or Taxes for the Lease Year is
more than Tenant's liability for Operating
Expenses and/or Taxes, then Landlord
shall pay the difference to Tenant within
thirty (30) days irrespective as to
whether Tenant shall no longer occupy the
Premises.
4.6 If the
Delivery Date is other than January 1 or if the Termination
Date is other than December 31, Tenant's
liability for Operating Expenses and
Taxes for the Lease Year in which said Date
occurs shall be prorated based upon
a three hundred sixty-five (365) day
year.
7
<PAGE>
4.7
Notwithstanding any other provision of this Lease to the
contrary,
Tenant shall have the right to audit the
Operating Expenses, Taxes and any and
all other costs, charges or expenses
(collectively, the "charges") for which
Tenant is required to reimburse Landlord
pursuant to this Lease, and Landlord
agrees to cooperate with any such audit.
Landlord shall maintain complete books
and records in accordance with generally
accepted accounting principles for the
same period as required for income tax
reporting purposes. Such audit(s) shall
only take place within one (1) year after
such charges are due in accordance
with the terms hereof. If it shall be
determined as a result of such audit(s)
that Tenant has overpaid any of such
charges, Landlord shall promptly refund to
Tenant the amount of such overpayment. If
the amount of Tenant's overpayment
exceeds four percent (4%) of said charges,
Landlord shall promptly pay the cost
of said audit(s) upon Tenant's submission
of an invoice for same.
5. TENANT'S RIGHT TO TERMINATE. The
Tenant's obligation under this Lease is
specifically contingent upon Landlord using
reasonably diligent efforts, at its
own expense, to secure all permits,
licenses and other governmental and private
approvals which are required for the
modification of the Site Plan as shown on
Exhibit C by February 10, 2005 (the
"Approvals").
If
Landlord does not receive said Approvals by February 10, 2005,
then
Tenant, at its sole option, may elect to
terminate this Lease by written notice
to Landlord on or before February 20, 2005,
accompanied by a lease termination
payment in the amount equal to Landlord's
costs relative to Tenant's specific
construction requirements for the Premises,
which costs include the Base
Building Architectural Design, Base
Building Sub-Redesign, Fit Up of
Architectural Design, Steel Premium for
Freezer/Cooler Space, Preconstruction
Activities/Dacon Project Planning,
Refrigeration Sub-Design and General
Conditions and Supervision (45 days extra
due to termination and re-work), but
such payment shall in no event exceed
$85,000.00. If Tenant gives such timely
notice and payment, this Lease shall
terminate and be of no further force or
effect; otherwise, Tenant shall
conclusively be deemed to have waived any
termination right it may have under this
Section 5.
6. LANDLORD'S WORK/ALTERATIONS.
6.1
Landlord shall, at Landlord's sole cost and expense, cause to
be
performed the work required described on
Exhibit B ("Landlord's Work"). Landlord
shall use due diligence to promptly
commence construction and shall use diligent
efforts to complete Landlord's Work. All
Landlord's Work shall be done in a good
and workmanlike manner employing good
materials and in compliance with all
applicable laws, rules, regulations and
codes, including, without limitation,
all building and zoning laws. Landlord
shall not make any material changes in
Landlord's Work without the prior written
approval of Tenant, but Landlord shall
have the right to substitute materials of
equal or higher quality if materials
specified on Exhibit B are not available in
time for a timely completion of
Landlord's Work. Tenant shall have the
right to install (at its own cost and
expense) and operate a generator on the
(10' x 15') generator pad shown on the
Plan. Landlord shall be responsible for
constructing the generator pad at its
cost and expense. Landlord agrees to use
its best efforts to obtain all
governmental approvals necessary to modify
the site plan to reduce the parking
and create trailer parking areas as shown
on Exhibit C, and if Landlord is able
to obtain such approvals, the parking areas
shall be built according to said
Exhibit C.
8
<PAGE>
6.2
Construction Representatives. Each party authorizes the other to
rely,
in connection with plans and construction,
upon approval and other actions on
the party's behalf by any Construction
Representative of the party named in the
Reference Page or any person hereafter
designated in substitution or addition by
written notice to the party relying.
Tenant's Construction Representative shall
be afforded full and complete access to the
Premises and Landlord's Work during
the construction of such work, and Landlord
shall allow Tenant's Construction
Representative to attend meetings relating
thereto.
6.3 Tenant
shall not make or suffer to be made any alterations, additions,
or improvements, including, but not limited
to, the attachment of any fixtures
or equipment in, on, or to the Premises or
any part thereof or the making of any
improvements as required by Article 7,
without the prior written consent of
Landlord, which consent shall not be
unreasonably withheld, conditioned or
delayed. When applying for such consent,
Tenant shall, if requested by Landlord,
furnish complete plans and specifications
for such alterations, additions and
improvements. Landlord may condition any
consent on Tenant's agreement to remove
such alterations, improvements or additions
at the end of the Term and to
restore the Premises to their previous
condition. Notwithstanding the foregoing,
non-structural alterations costing less
than $50,000.00 may be made by Tenant
without Landlord's approval provided Tenant
provides Landlord with as-built
plans for such alteration(s) and will
remove the same from the Premises upon
Landlord's request upon the termination of
this Lease.
6.4 In the
event Landlord consents to the making of any such alteration,
addition or improvement by Tenant, the same
shall be made at Tenant's sole cost
and expense. If Tenant shall employ any
Contractor other than Landlord's
Contractor and such other Contractor or any
Subcontractor of such other
Contractor shall employ any non-union labor
or supplier, Tenant shall be
responsible for any and all delays, damages
and extra costs suffered by Landlord
as a result of any dispute with any labor
unions concerning the wage, hours,
terms or conditions of the employment of
any such labor.
6.5 All
alterations, additions or improvements proposed by Tenant shall
be
constructed in accordance with all
government laws, ordinances, rules and
regulations and Tenant shall, prior to
construction, provide the additional
insurance required under Article 11 in such
case, and also all such assurances
to Landlord, including but not limited to,
waivers of lien, surety company
performance bonds and personal guaranties
of individuals of substance as
Landlord shall reasonably require to assure
payment of the costs thereof and to
protect Landlord and the Building and
appurtenant land against any loss from any
mechanic's, materialmen's or other liens.
Tenant shall pay in addition to any
sums due pursuant to Article 4, any
increase in real estate taxes attributable
to any such alteration, addition or
improvement for so long, during the Term, as
such increase is ascertainable. If there
shall be any dispute as to whether any
increase shall be attributable to Tenant's
improvements, the burden shall be on
Landlord to establish the same and the
matter shall be submitted to a third
party expert in municipal tax assessment
for final and binding arbitration. At
Landlord's election said sums shall be paid
in the same way as sums due under
Article 4.
6.6 All
alterations, additions, and improvements in, on, or to the
Premises made or installed by Tenant,
including carpeting, shall be and remain
the property of Tenant during the Term but,
excepting furniture, furnishings,
movable racks and partitions of less than
full height
9
<PAGE>
from floor to ceiling and other trade
fixtures, shall become a part of the
realty and belong to Landlord without
compensation to Tenant upon the expiration
or sooner termination of the Term, at which
time title shall pass to Landlord
under this Lease as by a bill of sale,
unless Landlord elects otherwise. Upon
such election by Landlord and provided
Landlord informs Tenant of such election
at the time Tenant requests approval of any
alterations, Tenant shall, at
Tenant's sole cost and expense, forthwith
and with all due diligence remove any
such alterations, additions or improvements
which are designated by Landlord to
be removed prior to such alterations being
made, and Tenant shall forthwith and
with all due diligence, at its sole cost
and expense, repair and restore the
Premises to their original condition,
reasonable wear and tear and damage by
fire or other casualty and repairs that are
the responsibility of the landlord,
excepted.
7. REPAIR.
7.1
Landlord shall have no obligation to alter, remodel, improve,
repair,
decorate or paint the Premises, except as
may be specified in Exhibit B attached
to this Lease, and except that Landlord
shall promptly repair, replace and
maintain the common areas and the exterior
and structural portions of the
Building, including without limitation, the
roof, walls, foundation, exterior
paint, exterior glass, floors (other than
carpeting), the parking areas and
Building Systems including without
limitation, plumbing, electrical (excluding
equipment in Tenant's freezer and
refrigeration areas and HVAC throughout the
Premises which shall be Tenant's sole
responsibility), utility and sewer lines
and sprinkler systems, except for damage
caused or repairs required as a result
of the acts or omissions of Tenant or
Tenant's agents, employees, contractors or
invitees. Landlord's costs of repair and
maintenance of any of the foregoing
(but not replacement costs) shall be
included in Tenant's Proportionate Share of
Operating Expenses. By taking possession of
the Premises, Tenant accepts them as
being in good order, condition and repair
and in the condition in which Landlord
is obligated to deliver them except for
such items for which Tenant shall have
given written notice to Landlord within
sixty (60) days after the Delivery Date,
except that with respect to the Building's
HVAC system, seasonal items, items
under warranty and latent defects, Tenant
shall have up to six (6) months to
notify Landlord of the same. It is hereby
understood and agreed that no
representations respecting the condition of
the Premises or the Building have
been made by Landlord to Tenant, except as
specifically set forth in this Lease.
Landlord shall not be liable for any
failure to make any repairs or to perform
any maintenance unless such failure shall
persist for an unreasonable time after
written notice of the need of such repairs
or maintenance is given to Landlord
by Tenant.
7.2 Tenant
shall at its own cost and expense, subject to Landlord's
obligations pursuant to Section 7.1 above,
keep and maintain all parts of the
Premises and such portion of the Building
and improvements as are within the
exclusive control of Tenant in good
condition, promptly making all necessary
repairs and replacements, whether ordinary
or extraordinary, with materials and
workmanship of the same character, kind and
quality as the original (including,
but not limited to, repair and replacement
of all fixtures installed by Tenant,
interior glass, doors, any special office
entries, interior walls and finish
work, floor coverings, electrical systems
and fixtures, refrigeration units,
dock boards, truck doors, dock bumpers,
plumbing work and fixtures, and
performance of regular removal of trash and
debris). Tenant, as part of its
obligations hereunder shall keep the
Premises in a clean and sanitary condition.
Tenant, upon termination of this Lease in
any way, will yield up the Premises to
Landlord in good condition and repair,
reasonable wear and tear, loss by fire or
other casualty and repairs that are the
10
<PAGE>
responsibility of Landlord excepted. Tenant
shall, at its own cost and expense,
repair any damage to the Premises or the
Building resulting from and/or caused
in whole or in part by the negligence or
misconduct of Tenant, its agents,
employees, invitees, or any other person
entering upon the Premises as a result
of Tenant's business activities or caused
by Tenant's default hereunder.
Landlord shall similarly be responsible to
Tenant for damage to the Premises
covered by Landlord or its contractors.
7.3 Except
as provided in Article 22, there shall be no abatement of rent
and no right of Tenant to terminate this
Lease by reason of any injury to or
interference with Tenant's business arising
due to the fault of Landlord, from
the making or failure to make any repairs,
alterations or improvements in or to
any portion of the Building or the Premises
or to fixtures, appurtenances and
equipment in the Building. Except to the
extent, if any, prohibited by law,
Tenant waives the right to make repairs at
Landlord's expense under any law,
statute or ordinance now or hereafter in
effect.
7.4
Notwithstanding anything to the contrary contained in this
Lease,
Landlord shall cause Landlord's Work, and
all other work performed by Landlord
pursuant to this Lease to be performed in a
good, workmanlike and lien free
manner in compliance with all applicable
laws, rules and regulations, and
Landlord warrants that all such work and
all systems and equipment installed by
Landlord in the Building or the Premises
shall be in good working condition as
of the Rent Commencement Date.
8. LIENS. Tenant shall keep the Premises,
the Building and appurtenant land and
Tenant's leasehold interest in the Premises
free from any liens arising out of
any services, work or materials performed,
furnished, or contracted for by
Tenant, or obligations incurred by Tenant.
In the event that Tenant shall not,
within thirty (30) days following the
imposition of any such lien, either cause
the same to be released of record or
provide Landlord with insurance against the
same issued by a major title insurance
company or such other protection against
the same as Landlord shall reasonably
accept, Landlord shall have the right to
cause the same to be released by such means
as it shall deem proper, including
payment of the claim giving rise to such
lien. All such sums paid by Landlord
and all reasonable expenses incurred by it
in connection therewith shall be
considered additional rent and shall be
payable to it by Tenant within thirty
(30) days of demand.
9. ASSIGNMENT AND SUBLETTING.
9.1 Except as
expressly set forth herein, Tenant shall not have the right
to assign or pledge this Lease or to sublet
the whole or any part of the
Premises whether voluntarily or by
operation of law, or permit the use or
occupancy of the Premises by anyone other
than Tenant, and shall not make,
suffer or permit such assignment,
subleasing or occupancy, without the prior
written consent of Landlord, which consent
Landlord agrees not to unreasonably
withhold or delay. Said restrictions shall
be binding upon any and all assignees
of this Lease and subtenants of the
Premises. In the event Tenant desires to
sublet, or permit such occupancy of, the
Premises, or any portion thereof, or
assign this Lease, Tenant shall give
written notice thereof to Landlord at least
thirty (30) days prior to the proposed
Delivery Date of such subletting or
assignment, which notice shall set forth
the name of the proposed subtenant or
assignee, the relevant terms of
11
<PAGE>
any sublease or assignment and copies of
any financial reports and other
relevant financial reports and other
relevant financial information of the
proposed subtenant or assignee.
9.2 In the
event that Tenant sells, sublets, assigns or transfers this
Lease, Tenant shall pay to Landlord as
additional rent an amount equal to fifty
percent (50%) of any Increased Rent (as
defined below) when and as such
Increased Rent is received by Tenant. As
used in this Section, "Increased Rent"
shall mean the excess of (i) all rent and
other consideration attributed to this
Lease which Tenant is entitled to receive
by reason of any sale, sublease,
assignment or other transfer of this Lease,
over (ii) the Rent, Taxes and
Operating Expense otherwise payable by
Tenant under this Lease at such time
after deducting all of Tenant's reasonable
costs directly related to such
sublease or assignment. For purposes of the
foregoing, any consideration
received by Tenant in form other than cash
shall be valued at its fair market
value as determined by Landlord in good
faith.
9.3
Notwithstanding any assignment or subletting, permitted or
otherwise,
Tenant shall at all times remain directly,
primarily and fully responsible and
liable for the payment of the rent
specified in this Lease and for compliance
with all of its other obligations under the
terms, provisions and covenants of
this Lease. Upon the occurrence of an Event
of Default, if the Premises or any
part of them are then assigned or sublet,
Landlord, in addition to any other
remedies provided in this Lease or provided
by law, may, at its option, collect
directly from such assignee or subtenant
all rents due and becoming due to
Tenant under such assignment or sublease
and apply such rent against any sums
due to Landlord from Tenant under this
Lease, and no such collection shall be
construed to constitute a novation or
release of Tenant from the further
performance of Tenant's obligations under
this Lease.
9.4
Notwithstanding any other provision hereof, Tenant shall have no
right
to make (and Landlord shall have the
absolute right to refuse consent to) any
assignment of this Lease or sublease of any
portion of the Premises if at the
time of either Tenant's notice of the
proposed assignment or sublease or the
proposed Delivery Date thereof, there shall
exist any uncured Event of Default
of Tenant.
9.5 Tenant
will pay to Landlord a sum equal to all of Landlord's
reasonable third party costs, including
reasonable attorney's fees, incurred in
investigating and considering any proposed
or purported assignment or pledge of
this Lease or sublease of any of the
Premises, regardless of whether Landlord
shall consent to, refuse consent, or
determine that Landlord's consent is not
required for, such assignment, pledge or
sublease. Any purported sale,
assignment, mortgage, transfer of this
Lease or subletting which does not comply
with the provisions of this Article 9 shall
be void.
9.6
Notwithstanding the foregoing provisions of this Section 9,
Tenant
may, without Landlord's consent, assign
this Lease or sublet any portion or all
of the Premises to any corporation,
partnership, trust, association or other
business organization directly or
indirectly controlling or controlled by Tenant
or to any successor by merger,
consolidation or acquisition of all or
substantially all of the assets of Tenant,
provided that the surviving entity
shall have a financial statement (balance
sheet and income statement) at least
as strong as that of the Tenant at the time
of execution of this Lease and shall
assume all of Tenant's obligations under
this
12
<PAGE>
Lease. As long as Tenant is a public
company, the public trading of its stock
shall not constitute an assignment of this
Lease.
10. INDEMNIFICATION. None of the Landlord
Entities (defined in Section 28 below)
shall be liable and Tenant hereby waives
all claims against them for any damage
to any personal property or any injury to
any person in or about the Premises or
the Land by or from any cause whatsoever
(including without limiting the
foregoing, rain or water leakage of any
character from the roof, windows, walls,
basement, pipes, plumbing works or
appliances, the Building not being in good
condition or repair, gas, fire, oil,
electricity or theft), except to the extent
caused by or arising from the negligence or
willful misconduct of Landlord or
its agents, employees or contractors for
which Landlord agrees to indemnify and
hold harmless Tenant. Tenant shall protect,
indemnify and hold the Landlord
Entities harmless from and against any and
all loss, claims, liability or costs
(including court costs and reasonable
attorney's fees) incurred by reason of (a)
any damage to any property (including but
not limited to property of any
Landlord Entity) or any injury (including
but not limited to death) to any
person occurring in, on or about the
Premises or the Land to the extent that
such injury or damage shall be caused by or
arise from any negligence by or of
Tenant, its agents, servants, employees,
invitees, or visitors to meet any
standards imposed by any duty with respect
to the injury or damage; (b) the
conduct or management of any work or thing
whatsoever done by the Tenant in or
about the Premises or from transactions of
the Tenant concerning the Premises;
(c) Tenant's failure to comply with any and
all governmental laws, ordinances
and regulations applicable to the condition
or use of the Premises or its
occupancy to the extent required in this
Lease; or (d) any breach or default on
the part of Tenant in the performance of
any covenant or agreement on the part
of the Tenant to be performed pursuant to
this Lease. The provisions of this
Article shall survive the termination of
this Lease with respect to any claims
or liability accruing prior to such
termination.
Landlord
will, in all events, indemnify and save Tenant harmless from
and
against any and all claims, actions,
damages, liability and expense in
connection with the loss of life, personal
injury and/or damage to property
arising from or out of any occurrence in,
upon or at the common areas or the
occupancy or use of same, or any part
thereof, by Landlord and its respective
agents, employees or contractors, without
limitation, with the exception of
those matters which stem directly from
Tenant's negligence, omissions or
intentional acts. In the event Tenant
shall, with no fault on its part, be made
a party to any litigation commenced by or
against Landlord arising from any such
action for which Landlord shall be
responsible to indemnify Tenant, then
Landlord shall protect and hold Tenant
harmless and pay all costs, expenses and
reasonable attorney's fees in connection
with such litigation with attorneys
selected by Landlord, subject to Tenant's
reasonable approval.
11. INSURANCE.
11.1
Tenant shall keep in force throughout the Term: (a) a
Commercial
General Liability insurance policy or
policies to protect the Landlord Entities
against any liability to the public or to
any invitee of Tenant or a Landlord
Entity incidental to the use of or
resulting from any accident occurring in or
upon the Premises with a limit of not less
than $1,000,000.00 per occurrence and
not less than $2,000,000.00 in the annual
aggregate, or such larger amount as
Landlord may prudently require from time to
time, covering bodily injury and
property damage liability and $1,000,000
products/completed operations
aggregate; (b) Business Auto Liability
13
<PAGE>
covering owned, non-owned and hired
vehicles with a limit of not less than
$1,000,000 per accident; (c) insurance
protecting against liability under
Worker's Compensation Laws with limits at
least as required by statute; (d)
Employers Liability with limits of $500,000
each accident, $500,000 disease
policy limit, $500,000 disease--each
employee; and (e) All Risk or Special Form
coverage protecting Tenant against loss of
or damage to Tenant's alterations,
additions, improvements, carpeting, floor
coverings, panelings, decorations,
fixtures, inventory and other business
personal property situated in or about
the Premises to the full replacement value
of the property so insured.
11.2 Each
of the aforesaid policies shall (a) be provided at Tenant's
expense; (b) name the Landlord and building
management company, if any, as
additional insureds; (c) be issued by an
insurance company with a minimum Best's
rating of "A: VII" during the Term; (d)
provide that said insurance shall not be
canceled unless thirty (30) days prior
written notice (ten days for non-payment
of premium) shall have been given to
Landlord; and (e) may be provided as a part
of any blanket insurance policy or policies
maintained by Tenant; and said
policy or policies or certificates thereof
shall be delivered to Landlord by
Tenant upon the Delivery Date and at least
thirty (30) days prior to each
renewal of said insurance.
11.3
Whenever Tenant shall undertake any alterations, additions or
improvements in, to or about the Premises
("Work") the aforesaid insurance
protection must extend to and include
injuries to persons and damage to property
arising in connection with such Work,
without limitation including liability
under any applicable structural work act,
and such other insurance as Landlord
shall require; and the policies of or
certificates evidencing such insurance
must be delivered to Landlord prior to the
commencement of any such Work.
11.4
Landlord represents that it currently maintain and shall
maintain
throughout the Term (a) all risk of
physical loss coverage for the full
replacement cost of the Building and (b)
general liability insurance coverage
for the Building consistent with that being
maintained from time to time by
reasonably prudent owners of properties
similar to the Building in the Boston
metropolitan area.
12. WAIVER OF SUBROGATION. Notwithstanding
anything contained in this Lease to
the contrary, so long as their respective
insurers so permit, Tenant and
Landlord hereby mutually waive their
respective rights of recovery against each
other for any loss insured by fire,
extended coverage, All Risks or other
insurance now or hereafter existing for the
benefit of the respective party but
only to the extent of the net insurance
proceeds payable under such policies.
Each party shall obtain any special
endorsements required by their insurer to
evidence compliance with the aforementioned
waiver.
13. SERVICES AND UTILITIES. Tenant shall
pay for all water, sewer, gas, heat,
light, power, telephone, and other
utilities and services used on or from the
Premises, together with any taxes,
penalties, and surcharges or the like
pertaining thereto and any maintenance
charges for utilities. The Tenant's
utilities to the Premises shall be
separately metered. Tenant shall furnish all
electric light bulbs, tubes and ballasts,
battery packs for emergency lighting
and fire extinguishers. Landlord covenants
and agrees to exercise all reasonable
efforts not to interfere with the conduct
of Tenant's business in the Premises
and to exercise commercial diligence in
repairing, replacing or restoring any
interruption in service or utilities.
14
<PAGE>
14. HOLDING OVER. Tenant shall pay Landlord
for each day Tenant retains
possession of the Premises or part of them
after termination of this Lease by
lapse of time or otherwise at the rate
("Holdover Rate") which shall be the
greater of (a) 130% for the first month and
150% thereafter of the amount of the
Annual Rent for the last period prior to
the date of such termination plus 100%
of all Additional Rent under Article 4; or
(b) the then market rental value of
the Premises as reasonably determined by
Landlord assuming a new lease of the
Premises of the then usual duration and
other terms, in either case prorated on
a daily basis, and also pay all damages
sustained by Landlord by reason of such
retention, and a tenancy at sufferance at
the Holdover Rate shall be deemed to
have been created. In any event, no
provision of this Article 14 shall be deemed
to waive Landlord's right of reentry or any
other right under this Lease or at
law.
15. SUBORDINATION. Without the necessity of
any additional document being
executed by Tenant for the purpose of
effecting a subordination, this Lease
shall be subject and subordinate at all
times to ground or underlying leases and
to the lien of any mortgages or deeds of
trust now or hereafter placed on,
against or affecting the Land, the
Building, Landlord's interest or estate in
the Building, or any ground or underlying
lease; provided, however, that if the
lessor, mortgagee, trustee, or holder of
any such mortgage or deed of trust
elects to have Tenant's interest in this
Lease be superior to any such
instrument, then, by notice to Tenant, this
Lease shall be deemed superior,
whether this Lease was executed before or
after said instrument. Notwithstanding
the foregoing, Tenant covenants and agrees
to execute and deliver within ten
(10) days after request by Landlord, such
further instruments evidencing such
subordination or superiority of this Lease
as may be required by Landlord,
including but not limited to the
Subordination, Non-Disturbance and Attornment
Agreement in the form attached hereto as
Exhibit D, which Tenant acknowledges to
be reasonable, or in such other form as
Landlord's lender may require. Landlord
agrees to provide Tenant with a
non-disturbance agreement in a form reasonable
acceptable to Tenant from its lender(s) and
it shall be a condition of Tenant's
obligation to subordinate this Lease to any
mortgage (and of the self
effectuating subordination provisions
described above) that the mortgagee shall
provide Tenant with a reasonable
Non-Disturbance Agreement. Landlord represents
that the Danvers Savings Bank is the only
lender currently holding a mortgage on
the Land, and that there are no ground
leases in effect on the Land, and
Landlord will provide Tenant with a
Subordination, Non-Disturbance and
Attornment Agreement from such bank.
16. RULES AND REGULATIONS. Tenant shall
faithfully observe and comply with all
the rules and regulations as set forth in
Exhibit E to this Lease and all
reasonable modifications of and additions
to them from time to time put into
effect by Landlord. Landlord shall not be
responsible to Tenant for the
non-performance by any other tenant or
occupant of the Building of any such
rules and regulations. Landlord covenants
to reasonably enforce such rules
fairly and non-discriminatorily against all
tenants in the Building.
17. REENTRY BY LANDLORD.
17.1
Landlord reserves and shall at all times, after reasonable
advance
notice to Tenant except in the case of
emergency, have the right to re-enter the
Premises to inspect the same, to show said
Premises to prospective purchasers,
mortgagees or, tenants, and to alter,
improve or repair any portion of the
Building, and may for that purpose erect,
use and maintain scaffolding,
15
<PAGE>
pipes, conduits and other necessary
structures and open any wall, ceiling or
floor in and through the Building and
Premises where reasonably required by the
character of the work to be performed,
provided entrance to the Premises shall
not be blocked thereby, and further
provided that the business of Tenant shall
not be interfered with unreasonably.
17.2
Landlord shall have the right at any time to change the
arrangement
and/or locations of entrances, or
passageways, doors and doorways, and
corridors, windows, elevators, stairs,
toilets or other public parts of the
Building provided the same does not
unreasonably interfere with Tenant's use of
the Premises or inconvenience Tenant, and
to change the name, number or
designation by which the Building is
commonly known. In the event that Landlord
damages any portion of any wall or wall
covering, ceiling, or floor or floor
covering within the Premises, Landlord
shall repair or replace the damaged
portion to match the original as nearly as
commercially reasonable but shall not
be required to repair or replace more than
the portion actually damaged.
Landlord agrees that it shall not eliminate
any parking shown on the Plan,
except as proposed by the modification of
the site plan to accommodate Tenant's
truck parking shown on Exhibit C, and shall
not make any material modifications
to Tenant's vehicular ingress or egress to
or from the Property.
17.3 For
each of the aforesaid purposes, Landlord shall at all times
have
and retain a key with which to unlock all
of the doors in the Premises,
excluding Tenant's vaults and safes or
special security areas (designated in
advance), and Landlord shall have the right
to use any and all means which
Landlord may deem proper to open said doors
in an emergency to obtain entry to
any portion of the Premises. As to any
portion to which access cannot be had by
means of a key or keys in Landlord's
possession, Landlord is authorized to gain
access by such means as Landlord shall
elect and the cost of repairing any
damage occurring in doing so shall be borne
by Tenant and paid to Landlord as
additional rent upon demand.
18. DEFAULT.
18.1
Except as otherwise provided in Article 20, the following
events
shall be deemed to be "Events of Default"
under this Lease:
18.1.1 Tenant shall fail to pay when due any sum of money
becoming
due to be paid to Landlord under this
Lease, whether such sum be any installment
of the rent reserved by this Lease, any
other amount treated as additional rent
under this Lease, or any other payment or
reimbursement to Landlord required by
this Lease, whether or not treated as
additional rent under this Lease, and such
failure shall continue for a period of ten
(10) days after written notice that
such payment was not made when due, but if
within any twelve month period
commencing with the date of the first
notice Landlord shall give two (2) such
notices, then thereafter, the failure to
pay within seven days after due any
additional sum of money becoming due to be
paid to Landlord under this Lease
shall be an Event of Default without
notice.
18.1.2 Tenant shall fail to comply with any term, provision or
covenant of this Lease which is not
provided for in another Section of this
Article and shall not cure such failure
within thirty (30) days (forthwith, if
the failure involves a hazardous condition)
after written notice of such failure
to Tenant; provided, however, that if such
cure cannot be reasonably performed
within such 30-day period, Tenant shall
have a reasonable period of time to
complete
16
<PAGE>
such cure so long as Tenant commences the
cure within such 30-day period and
thereafter diligently pursues such cure to
completion.
18.1.3 Tenant shall become insolvent, file a petition in
bankruptcy
or a petition to take advantage of any
insolvency statute, make an assignment
for the benefit of creditors, make a
transfer in fraud of creditors, apply for
or consent to the appointment of a receiver
of itself or of the whole or any
substantial part of its property, or file a
petition or answer seeking
reorganization or arrangement under the
federal bankruptcy laws, as now in
effect or hereafter amended, or any other
applicable law or statute of the
United States or any state thereof.
18.1.4 A court of competent jurisdiction shall enter an order,
judgment or decree adjudicating Tenant
bankrupt, or appointing a receiver of
Tenant, or of the whole or any substantial
part of its property, without the
consent of Tenant, or approving a petition
filed against Tenant seeking
reorganization or arrangement of Tenant
under the bankruptcy laws of the United
States, as now in effect or hereafter
amended, or any state thereof, and such
order, judgment or decree shall not be
vacated or set aside or stayed within
sixty (60) days from the date of entry
thereof.
19. REMEDIES.
19.1
Except as otherwise provided in Article 20, upon the occurrence
of
any of the Events of Default described or
referred to in Article 18, Landlord
shall have the option to pursue any one or
more of the following remedies
without any notice or demand whatsoever,
concurrently or consecutively and not
alternatively:
19.1.1 Landlord may, at its election, terminate this Lease or
terminate Tenant's right to possession
only, without terminating the Lease.
19.1.2 Upon any termination of this Lease, whether by lapse of
time
or otherwise, or upon any termination of
Tenant's right to possession without
termination of the Lease, Tenant shall
surrender possession and vacate the
Premises immediately, and deliver
possession thereof to Landlord, and Tenant
hereby grants to Landlord full and free
license to enter into and upon the
Premises in such event and to repossess
Landlord of the Premises as of
Landlord's former estate and to expel or
remove Tenant and any others who may be
occupying or be within the Premises and to
remove Tenant's signs and other
evidence of tenancy and all other property
of Tenant therefrom without being
deemed in any manner guilty of trespass,
eviction or forcible entry or detainer,
and without incurring any liability for any
damage resulting therefrom, Tenant
waiving any right to claim damages for such
re-entry and expulsion, and without
relinquishing Landlord's right to rent or
any other right given to Landlord
under this Lease or by operation of
law.
19.1.3 Upon any termination of this Lease, whether by lapse of
time
or otherwise, Landlord shall be entitled to
recover as damages, all rent,
including any amounts treated as additional
rent under this Lease, and other
sums due and payable by Tenant on the date
of termination, plus as liquidated
damages and not as a penalty, an amount
equal to the sum of: (a) an amount equal
to the then present value of the rent
reserved in this Lease for the residue of
the stated Term of this Lease including any
amounts treated as additional rent
under this Lease and all other sums
provided in this Lease to be paid by Tenant,
minus the fair rental value of the
17
<PAGE>
Premises for such residue; (b) the amount
of rent loss and expense incurred
necessary to obtain a replacement tenant or
tenants, and the estimated expenses
described in Section 19.1.4 relating to
recovery of the Premises, preparation
for reletting and for reletting itself and
(c) the cost of performing any other
covenants which would have otherwise been
performed by Tenant. Landlord agrees
to use commercially reasonable efforts to
relet the Premises after any default
by Tenant.
19.1.4 Upon any termination of Tenant's right to possession
only
without termination of the Lease:
19.1.4.1 Neither such termination of Tenant's right to
possession nor Landlord's taking and
holding possession thereof as provided in
Section 19.1.2 shall terminate the Lease or
release Tenant, in whole or in part,
from any obligation, including Tenant's
obligation to pay the rent, including
any amounts treated as additional rent,
under this Lease for the full Term, and
if Landlord so elects Tenant shall pay
forthwith to Landlord the sum equal to
the entire amount of the rent, including
any amounts treated as additional rent
under this Lease, for the remainder of the
Term plus any other sums provided in
this Lease to be paid by Tenant for the
remainder of the Term.
19.1.4.2 Landlord may, but need not, relet the Premises or any
part thereof for such rent and upon such
terms as Landlord, in its sole
discretion, shall determine (including the
right to relet the premises for a
greater or lesser term than that remaining
under this Lease, the right to relet
the Premises as a part of a larger area,
and the right to change the character
or use made of the Premises). In connection
with or in preparation for any
reletting, Landlord may, but shall not be
required to, make repairs, alterations
and additions in or to the Premises and
redecorate the same to the extent
Landlord deems necessary or desirable, and
Tenant shall, upon demand, pay the
cost thereof, together with Landlord's
expenses of reletting, including, without
limitation, any commission incurred by
Landlord. Landlord shall not be required
to observe any instruction given by Tenant
about any reletting or accept any
tenant offered by Tenant unless such
offered tenant has a creditworthiness
acceptable to Landlord and leases the
entire Premises upon terms and conditions
including a rate of rent (after giving
effect to all expenditures by Landlord
for tenant improvements, broker's
commissions and other leasing costs) all no
less favorable to Landlord than as called
for in this Lease, nor shall Landlord
be required to make or permit any
assignment or sublease for more than the
current term or which Landlord would not be
required to permit under the
provisions of Article 9.
19.1.4.3 Until such time as Landlord shall elect to terminate
the Lease and shall thereupon be entitled
to recover the amounts specified in
such case in Section 19.1.3, Tenant shall
pay to Landlord upon demand the full
amount of all rent, including any amounts
treated as additional rent under this
Lease and other sums reserved in this Lease
for the remaining Term, together
with the costs of repairs, alterations,
additions, redecorating and Landlord's
expenses of reletting and the collection of
the rent accruing therefrom
(including reasonable attorney's fees and
broker's commissions), as the same
shall then be due or become due from time
to time, less only such consideration
as Landlord may have received from any
reletting of the Premises; and Tenant
agrees that Landlord may file suits from
time to time to recover any sums
falling due under this Article 19 as they
become due. Any proceeds of reletting
by Landlord in excess of the amount then
owed by Tenant to Landlord from time to
time shall be
18
<PAGE>
credited against Tenant's future
obligations under this Lease but shall not
otherwise be refunded to Tenant or inure to
Tenant's benefit.
19.2
Landlord may, at Landlord's option, enter into and upon the
Premises
if Landlord determines in its sole
discretion that Tenant is not acting within a
commercially reasonable time to maintain,
repair or replace anything for which
Tenant is responsible under this Lease and
correct the same, without being
deemed in any manner guilty of trespass,
eviction, or forcible entry and
detainer and without incurring any
liability for any damage or interruption of
Tenant's business resulting therefrom.
19.3 If, on
account of any breach or default by Tenant or Landlord under
the terms and conditions of this Lease, it
shall become necessary or appropriate
for either party to employ with an attorney
to enforce or defend any of it's
rights or remedies arising under this
Lease, the losing party agrees to pay all
of the prevailing party's reasonable
attorney's fees so incurred. Tenant
expressly waives any right to trial by
jury.
19.4
Pursuit of any of the foregoing remedies shall not preclude
pursuit
of any of the other remedies provided in
this Lease or any other remedies
provided by law (all such remedies being
cumulative), nor shall pursuit of any
remedy provided in this Lease constitute a
forfeiture or waiver of any rent due
to Landlord under this Lease or of any
damages accruing to Landlord by reason of
the violation of any of the terms,
provisions and covenants contained in this
Lease.
19.5 No
act or thing done by Landlord or its agents during the Term
shall
be deemed a termination of this Lease or an
acceptance of the surrender of the
Premises, and no agreement to terminate
this Lease or accept a surrender of said
Premises shall be valid, unless in writing
signed by Landlord. No waiver by
Landlord of any violation or breach of any
of the terms, provisions and
covenants contained in this Lease shall be
deemed or construed to constitute a
waiver of any other violation or breach of
any of the terms, provisions and
covenants contained in this Lease.
Landlord's acceptance of the payment of
rental or other payments after the
occurrence of an Event of Default shall not
be construed as a waiver of such Default,
unless Landlord so notifies Tenant in
writing. Forbearance by Landlord in
enforcing one or more of the remedies
provided in this Lease upon an Event of
Default shall not be deemed or construed
to constitute a waiver of such Default or
of Landlord's right to enforce any
such remedies with respect to such Default
or any subsequent Default.
19.6 Any
and all property which may be removed from the Premises by
Landlord pursuant to the authority of this
Lease or of law, to which Tenant is
or may be entitled, may be handled, removed
and/or stored, as the case may be,
by or at the direction of Landlord but at
the risk, cost and expense of Tenant,
and Landlord shall in no event be
responsible for the value, preservation or
safekeeping thereof. Tenant shall pay to
Landlord, upon demand, any and all
reasonable expenses incurred in such
removal and all storage charges against
such property so long as the same shall be
in Landlord's possession or under
Landlord's control. Any such property of
Tenant not retaken by Tenant from
storage within thirty (30) days after
removal from the Premises and notice to
Tenant shall, at Landlord's option, be
deemed conveyed by Tenant to Landlord
under this Lease as by a bill of sale
without further payment or credit by
Landlord to Tenant.
19
<PAGE>
19.7 In
the event that Landlord shall at any time be in default in the
observance or performance of any of the
covenants and agreements required to be
performed and observed by Landlord
hereunder and any such default shall continue
for a period of thirty (30) calendar days
after written notice to Landlord (or
if such default is incapable of being cured
in a reasonable manner within thirty
(30) calendar days then if Landlord has not
commenced to cure the same within
said thirty (30) calendar day period and
thereafter diligently prosecutes the
same to completion) and Landlord shall not
thereafter cure such default, Tenant
shall be entitled at its election, to bring
suit for the collection of any
amounts for which Landlord may be in
default, or for' the performance of any
other covenant or agreement devolving upon
Landlord, in addition to all remedies
otherwise provided in this Lease and
otherwise available in law or equity under
the laws of the United States or the State
or Commonwealth in which the Premises
are located, and after any judgment may be
obtained by Tenant, Tenant may offset
the amount of any such judgment against
rent due under this Lease.
In
addition to all of Tenant's other remedies hereunder, if
Landlord
defaults in the performance of any
obligation imposed on it by this Lease and
does not cure such default within twenty
(20) days after written notice from
Tenant specifying the default (or does not
within said period commence and
diligently proceed to cure such default),
Tenant, without waiver of or prejudice
to any other right or remedy it may have,
shall have the right, at any time
thereafter, to cure such default for the
account of the Landlord, and Landlord
shall reimburse Tenant upon invoice for any
amount paid and any expense or
contractual liability so incurred. If
Landlord fails to reimburse Tenant, then
Tenant shall have the right to offset
