Exhibit 10.14
LEASE
THIS LEASE (this "Lease") is made as of the 31st day of March, 1997, by
and between CONSTITUTION REALTY COMPANY, LLC, having a business address c/x
Xxxxxx/Xxxxx Company, LLC, 000 Xxxxx Xxxxxx, Xxxxxxx, Xxxxxxxxxxxxx 00000
("Landlord"), and PHOENIX COLOR CORP., having a business address at 000 Xxxxxxx
Xxxxxxxx Xxxxxxx, Xxxxxxxxxx, Xxxxxxxx 00000 ("Tenant")
Landlord hereby leases to Tenant and Tenant hereby rents and leases from
Landlord all of Landlord's rights and interests in and to the following
(collectively, the "Leased Property"):
(a) the real property having an address at ______ Constitution Drive,
Taunton, Massachusetts, as more particularly described in EXHIBIT A attached
hereto (the "Land");
(b) all buildings, structures, and other improvements of every kind
including, but not limited to, alleyways and connecting tunnels, sidewalks,
utility pipes, conduits and lines, and parking areas and roadways appurtenant to
such buildings and structures presently or hereafter situated upon the Land
(collectively, the "Leased Improvements");
(c) all easements, rights and appurtenances of every nature and
description now or hereafter relating to or benefitting any or all of the Land
and the Leased Improvements; and
(d) all equipment, machinery, building fixtures, and other items of
property (whether realty, personalty or mixed), including all components
thereof, owned by Landlord and now or hereafter located in, on or used in
connection with, and permanently affixed to or incorporated into the Leased
Improvements, including, without limitation, all furnaces, boilers, heaters,
electrical equipment, heating, plumbing, lighting, ventilating, refrigerating,
incineration, air and water pollution control, waste disposal, air-cooling and
air-conditioning systems and apparatus, sprinkler systems and fire and theft
protection equipment, and built-in oxygen and vacuum systems, all of which, to
the greatest extent permitted by law, are hereby deemed by the parties hereto to
constitute real estate, together with all replacements, modifications,
alterations and additions thereto.
1. REFERENCE DATA.
Each of the following capitalized terms used in this Lease shall have the
meaning set forth opposite such term below:
COMMENCEMENT DATE: The later of (a) December 1, 1997 or (b) the date
determined under Section 25 below.
RENTABLE AREA OF FLOOR
SPACE WITHIN THE
LEASED IMPROVEMENTS: 54,300 square feet
PERMITTED USE: The use of the Leased Property as a Light Industrial
and Printing Facility.
SECURITY DEPOSIT: None
TENANT'S
MAILING ADDRESS: Phoenix Color Corp
000 Xxxxxxx Xxxxxxxx Xxxxxxx
Xxxxxxxxxx, Xxxxxxxx 00000
Attention: Xxxxxx Xxxxxxxxx
with a copy to:
Xxxxxx X. Xxxxxxx, Esq.
Rosner, Bresler, Xxxxxxx & Xxxxxxx
000 Xxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, XX 00000
LANDLORD'S MAILING
ADDRESS: Constitution Realty Company, LLC
c/x Xxxxxx/Xxxxx Company, LLC
000 Xxxxx Xxxxxx
Xxxxxxx, Xxxxxxxxxxxxx 00000
Attention: Xxxxxx X. Xxxxx
with a copy to:
Fruik Giso III, Esq.
Xxxxxx, Hail & Xxxxxxx
Exchange Place
00 Xxxxx Xxxxxx
Xxxxxx, XX 00000
BROKER: Xxxxx Properties and Whittier Partners, as equal
co- brokers
RENT: Collectively, the Base Rent, the Additional Rent and
all other sums payable under this Lease.
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ADDITIONAL RENT: All charges payable by Tenant pursuant to this Lease
other than Base Rent, including without implied
limitation: Real Estate and Other Taxes as provided
in Section 5; Operating Expenses in accordance with
Section 6; and insurance premiums in accordance with
Section 18.
LEASE YEAR: A period of twelve (12) consecutive calendar months
commencing on the Commencement Date or the first day
of the month subsequent to the month in which the
Commencement Date occurs if the Commencement Date
is any day other than the first day of a month, and
then each consecutive twelve (12) month period
occurring thereafter during the Term of this Lease.
GOVERNMENTAL
AUTHORITIES: Collectively, all agencies, authorities, bodies,
boards, commissions, courts, instrumentalities,
legislatures, and offices of any nature whatsoever
of any government, quasi-government unit or
political subdivision, whether with a federal,
state, county, district, municipal, city or
otherwise and whether now or hereinafter in
existence.
LEGAL
REQUIREMENTS: Collectively, all statutes, ordinances, by-laws,
codes, rules, regulations, restrictions, orders,
judgments, decrees and injunctions (including,
without limitation, all applicable building, health
code, zoning, subdivision, and other land use and
assisted living licensing statutes, ordinances,
by-laws, codes, rules and regulations), whether now
or hereafter enacted, promulgated or issued by any
Governmental Authority, affecting the Tenant, or the
Leased Property or the ownership, construction,
development, maintenance, management, repair, use,
occupancy, possession or operation thereof or the
operation of any programs or services in connection
with the Leased Property, including, without
limitation, any of the foregoing which may (i)
require repairs, modifications or alterations in or
to the Leased Property, (ii) in any way affect
(adversely or otherwise) the use and enjoyment of
the Leased Property or (iii) require the assessment,
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monitoring, clean-up, containment, removal,
remediation or other treatment of any hazardous
substances on, under or from the Leased Property.
CONSUMER PRICE INDEX: United States Department of Labor Bureau of Labor
Statistics Consumer Price Index, All Urban
Consumers, All Items, (1982-84 equals 100) for
Boston-Lawrence-Salem, Massachusetts-New Hampshire;
if the Bureau of Labor Statistics substantially
revises the manner in which the Consumer Price Index
is determined, an adjustment shall be made in the
revised index which would produce results
equivalent, as nearly as possible, to those which
would be obtained if the Consumer Price Index had
not been so revised. If the Consumer Price Index
becomes unavailable to the public because
publication is discontinued or for any other reason,
or if data is not readily available to enable
Landlord to make the adjustment to the revised index
referred to above, Landlord shall substitute a
comparable index based on changes in the cost of
living or purchasing power of the consumer dollar
published by any other governmental agency or, if no
such index is available, then a comparable index
published by a major bank, other financial
institution, university or recognized financial
publication, generally recognized and used for such
adjustments in the Boston Metropolitan Area; any
such substituted Index shall be subject to Tenant's
approval, which approval shall not be unreasonably
withheld or delayed.
2. LEASE TERM: EXTENSIONS.
The term of this Lease shall be for a period of fifteen (15) years
commencing on the Commencement Date and ending on the last day of the month in
which the fifteenth (15th) anniversary of the Commencement Date occurs (the
"Term" or the "Original Term", as the case may be).
3. BASE RENT.
3.1 BASE RENT. Subject to the immediately following sentence, Tenant
shall pay to Landlord rent ("Base Rent") as follows: Four Hundred Seventy Five
Thousand One Hundred
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Twenty Five Dollars ($475,125.00) per year, for the period from December 1, 1997
to November 30, 2004; Five Hundred Twenty Five Thousand Eighty One Hundred
Dollars ($525,081.00) per year for the period from December 1, 2004 to November
30, 2008; and Six Hundred Twenty Four Thousand Four Hundred Fifty Dollars
($624,450.00) per year for the period from December 1, 2008 to November 30,
2012. In the event that the Commencement Date shall be determined under Section
25 to be a date other than December 1, 1997, then all other dates specified in
this Section 3.1 shall be adjusted so that each of the segments of the Term
determined by the dates specified in this Section 3.1 shall contain the same
number of months.
3.2 PAYMENT OF RENT. Payment of Base Rent shall be made by Tenant in
equal monthly installments on the Commencement Date and thereafter on the first
day of each month during the Term in advance, in lawful money of the United
States. The Base Rent payment for any fractional month at the commencement,
termination or expiration of the Term will be pro rated accordingly. All Rent
shall be paid and sent to Landlord at Landlord's Mailing Address.
3.3 NO TERMINATION. ABATEMENT, OFFSETS, ETC. Except as otherwise
specifically provided in this Lease, Tenant, to the maximum extent permitted by
law, shall remain bound by this Lease in accordance with its terms and shall
neither take any action without the consent of Landlord to modify, surrender or
terminate the same, nor seek nor be entitled to any abatement, deduction,
deferment or reduction of the annual Base Rent or Additional Rent, or set-off
against any Rent hereunder, nor shall the respective obligations of Landlord and
Tenant be otherwise affected by reason of (a) any damage to, or destruction of;
all or any part of the Leased Property as a result of condemnation. or any other
cause; (b) the prohibition or restriction upon Tenant's use of all or any part
of the Leased Property; (c) any claim which Tenant may have against Landlord by
reason of any breach or default by Landlord under this Lease; (d) any
bankruptcy, insolvency, reorganization, composition, readjustment, liquidation,
dissolution, winding up or other proceedings affecting Landlord or any assignee
or transferee of Landlord; or (e) for any other cause whether similar or
dissimilar to any of the foregoing. Except as otherwise expressly and
specifically provided in this Lease, the obligations of Landlord and Tenant
hereunder shalt be separate and independent covenants and agreements and all
Rent and all other sums payable by Tenant hereunder shall continue to be payable
in all events. However, the foregoing provisions of this Section shall not be
construed to prohibit Tenant from exercising any other rights or remedies
available to Tenant at law or in equity, including, without limitation, a
proceeding to obtain injunctive relief to enforce Landlord's obligations under
this Lease.
3.4 NET LEASE. It is understood and agreed that this Lease is an absolute
net lease so that, except as otherwise expressly herein provided, the annual
Base Rent is entirely net to Landlord and Landlord shall not be required to
incur any costs or expenses with respect to the Leased Property during the Term,
excepting only (a) Landlord's obligation to perform the Landlord's Work (as
defined in Section 25 below), (b) Landlord's obligations to restore the Leased
Property in the event of casualty or condemnation as contemplated under Sections
19.1 and 19.3, respectively, (c) Landlord's obligations to make certain
structural and other repairs as
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contemplated under Section 12.2 and (d) any other obligations expressly imposed
upon Landlord in this Lease.
3.5 TENANT ALLOWANCE FOR LANDSCAPING AND BUILDING IMPROVEMENTS.
The annual Base Rent set forth above includes a so-called "allowance"
figure in the amount of ONE HUNDRED FORTY THOUSAND DOLLARS ($140,000.00) (the
"Allowance Account") that was used in calculating such annual Base Rent. This
Allowance Account is intended to cover the cost of any and all landscaping of
the Leased Property and also any additional costs resulting from Tenant's
request to change any of the plans and specifications for the Leased
Improvements to be constructed by Landlord not currently specified in EXHIBIT LW
attached hereto. However,. if there are any savings associated with Tenant's
deletion of items from the work currently specified in EXHIBIT LW, then such
savings shall be added to the Allowance Account. The amount to be charged to the
Allowance Account for Tenant requested changes to the work described in EXHIBIT
LW shall be determined as part of the change order process under Landlord's
construction contract. Any unspent portion of the Allowance Account remaining
after deductions for landscaping and Tenant requested changes shall be paid to
Tenant within 60 days after the Commencement Date.
4. EXTENSION RIGHTS.
Provided there is not then an uncured Event of Default hereunder or at
the commencement of the Option Term (as hereinafter defined), Tenant shall have
the right to extend the Term for one (1) five-year extension period. (the
"Option Term") upon the following terms and conditions:
4.1 Tenant must notify Landlord of its election to extend the Term for
the Option Term on or before the date which is one year prior to the date on
which the Original Term expires.
4.2 The annual Base Rent for the Option Term shall be equal to the lower
of (i) the Fair MarKet Rental Value as determined in EXHIBIT FMRV attached
hereto, as determined on the last day of the Original Term or (2) the Base Rent
for the last year of the Original Term escalated at one-half of the total change
in the Consumer Price Index over the preceding five (5) year period. In no event
will Base Rent be less than the Base Rent for the last year of the Original
Term.
4.3 All provisions of this Lease shall remain in effect during the Option
Term except the right to extend as set forth in this Section 4, it being agreed
that there are no further rights of extension after the Option Term. Unless
expressly stated herein to the contrary, all references in this Lease to the
"Term" shall include the Option Term when and if Landlord receives Tenant's
notice of election to extend the Term as herein provided.
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5. REAL ESTATE AND OTHER TAXES.
(a) From and after the Commencement Date, during the Term, Tenant shall
pay directly to the applicable taxing authority or agency, as Additional Rent,
Real Estate Taxes, as hereinafter defined, in accordance with this Section 5 and
also all taxes relating to any of Tenant's personal property or equipment on the
Leased Property. The terms used in this Section 5 are defined as follows:
(i) "Tax Year" means the 12-month period beginning July 1 each
year or if the appropriate governmental tax fiscal period shall begin on
any date other than July 1 such other date.
(ii) "Real Estate Taxes" means all taxes, special taxes and special
assessments of every kind and nature assessed by any governmental
authority on the Leased Property during the Term of this Lease, reduced
by any abatement receipts with respect to any Tax Year. The amount of
special taxes or special assessments to be included shall be limited to
the amount of the installment (plus any interest thereon) of such
special tax or special assessment (which shall be payable over the
longest period permitted by law) required to be paid during the Tax Year
in respect of which such taxes are being determined and for any Tax Year
at the beginning or end of the Term which is not wholly included within
the Term of this Lease, the amount of Real Estate Taxes owed by Tenant
for such partial Tax Year shall be prorated. There shall be excluded
from such taxes any income, estate, succession, inheritance, excess
profit, franchise and transfer taxes assessed against Landlord: PROVIDED,
HOWEVER, that if at any time during the Term the present system of
taxation of real property shall be changed so that in lieu all or any
portion of such real property tax, there shall be assessed on Landlord a
capital levy or other tax on the gross rents received with respect to the
Leased Property, or a federal, state, county, municipal, or other local
income, franchise, excise or similar tax, assessment, levy or charge
(distinct from any now in effect) based, in whole or in part, upon any
such gross rents, then any and all of such taxes, assessments, levies or
charges, to the extent so based and to the extent that such gross Tents
are the sole rents of Landlord received with respect to the Leased
Property, shall be deemed to be included within the term "Real Estate
Taxes"
(b) Payments by Tenant on account of Real Estate Taxes shall be made at
least ten (10) days prior to the due date of the applicable installment.
Landlord and Tenant shall arrange For Tenant to be billed directly by all
applicable taxing authorities or agencies. Tenant shall promptly furnish
Landlord with satisfactory evidence that Real Estate Taxes have been timely
paid. If Tenant shall fail to pay any Real Estate Taxes required hereunder to be
paid by Tenant, Landlord shall have the right, in addition to any other rights
of Landlord hereunder, to pay the same, and Tenant shall reimburse Landlord
therefor upon demand.
(c) Tenant shall have the right to contest or seek a reduction or
abatement of Real Estate Taxes, provided that Tenant shall continue to pay all
Real Estate Taxes as required
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hereinunder until such time as an abatement or reduction is granted. Tenant
shall not have the right to seek reimbursement from Landlord or reduce or
offset its obligation to pay annual Base Rent for any out-of-pocket expenses,
including, without limitation, attorneys' and experts' fees and costs,
incurred by Tenant in connection with any attempted reduction or abatement of
Real Estate Taxes. Landlord shall, at Tenant's request, assist Tenant in
seeking any abatement for reduction of Real Estate Taxes, provided however
that the Landlord shall not be required to incur any out-of-pocket expenses
or liability in connection with such assistance to Tenant. Similarly, if
Landlord elects to file a petition or an action for the abatement or
reduction of Real Estate Taxes (it being understood, however, that Landlord
has absolutely no obligation to do so) and Landlord incurs any out-of-pocket
expenses in connection with such an attempted abatement or reduction in Real
Estate Taxes, Tenant shall reimburse Landlord for such expenses immediately
upon demand therefor.
(d) Notwithstanding any of the foregoing, in the event any mortgagee of
the Leased Property requires Landlord to escrow taxes with such mortgagee, then
promptly upon written notice of such requirement to Tenant, Tenant shall pay all
Real Estate Taxes directly to Landlord monthly at the time and in the fashion
herein provided for the payment of Base Rent and in an amount equal to
one/twelfth of Real Estate Taxes for the current tax year, which amount shall be
reasonably estimated by Landlord or Landlord's mortgagee to pay in full all Real
Estate Taxes when due. Not later than 90 days after the end of the relevant tax
year, Landlord shall render a statement in reasonable detail showing all Real
Estate Taxes for the prior year. If at the time such statement is rendered it is
determined with respect to any tax year that Tenant has paid (i) less than the
full amount of Real Estate Taxes or (ii) more than the full amount of Real
Estate Taxes, then in the case of (i) Tenant shall pay to Landlord, as
Additional Rent, within fifteen (15) days after receiving such statement, the
amount of such underpayment and in the case of (ii) Landlord shall credit the
amount of such overpayment within fifteen (15) days after rendering such
statement against the monthly installments of Real Estate Taxes next thereafter
coming due (or refund such overpayment if the term has expired).
6. OPERATING EXPENSES.
From and after the Commencement Date, during the Term, Tenant shall pay
directly to the vendor of the services or commodity being supplied to the Leased
Property, as Additional Rent, Operating Expenses, as hereinafter defined, in
accordance with this Section 6. "Operating Expenses" means all costs of
operating, cleaning, maintaining and repairing the Leased Improvements, all
landscaping upon the Leased Property and the parking lot thereon and the
driveways and walkways and all other improvements and amenities which are pant
of the Leased Property, including without limitation, (i) the amount deductible
from any insurance claim (unless the damage to which such insurance claim
related was caused by the negligence or intentional misconduct of Landlord),
(ii) interior and exterior maintenance, (iii) steam, water, sewer, gas, oil,
electricity, telephone and other utility charges, (iv) the cost of HVAC service
and maintenance (v) the cost of building and cleaning supplies, (vi) rental and
leasing costs for equipment used in the operating, cleaning, maintaining or
repairing of the Leased Property, (vii) the cost of cleaning the Leased
Improvements, (viii) the cost of maintenance, repairs and replacements (other
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than Structural Repairs which are the obligation of Landlord), (ix) the cost of
maintaining off site amenities and improvements required by the county,
municipality or any commission or other agency having jurisdiction over the
Leased Property, in connection with obtaining any permit or approval for the
operation of the Leased Property, (x) the allocable costs from-om any business
owner's association(s) in which membership of Landlord or Tenant is required by
virtue of the location of the Leased Property, (xi) the cost of landscape
maintenance, (xii) the cost of security and alarm systems, and (xiii) payments
under service contracts with independent contractors for services to the Leased
Property.
7 WARRANTIES AND COVENANTS.
7.1 LANDLORD WARRANTIES. Landlord represents and warrants the following
to Tenant as of the date hereof and as of the Commencement Date:
(a) Landlord is duly organized and validly existing as a limited
liability company in the Commonwealth of Massachusetts. Landlord has full power
and authority to execute and deliver this Lease, and to carry on its business as
presently conducted.
(b) Landlord has the complete and unrestricted power to enter into
this Lease and perform its obligations hereunder. The Lease when executed and
delivered by Landlord, constitutes the valid and legally binding obligation of
Landlord, enforceable against Landlord in accordance with its term; subject to
(i) applicable bankruptcy, insolvency, reorganization, moratorium and other laws
affecting the rights of creditors generally and (ii) the exercise of judicial
discretion in accordance with general principles of equity.
(c) Landlord is not a parry to any litigation, proceeding or
controversy pending before any court or administrative agency or, to Landlord's
knowledge, threatened against Landlord; nor is Landlord in receipt of any
inquiry, notice, citation, investigation or complaint from any governmental
agency or department, which might materially adversely affect Landlord's ability
to enter into and/or perform its obligations under this Lease.
(d) Landlord is not a party to, subject to or bound by, any
agreement, judgment, order, writ, injunction or decree of any court or
Governmental Authority which could prevent the consummation of the transactions
contemplated herein.
(e) Neither the execution or delivery, nor performance of this Lease
or the other agreements contemplated herein in accordance with their respective
terms, does, nor will, after the giving of notice; the lapse of time or
otherwise, conflict with, result in a breach of, or constitute a default under,
the charter of Landlord or to the knowledge of Landlord constitute a default
under any contract or other agreement to which Landlord is a party (except those
for which consent has been or will be obtained by the Commencement Date) or by
which Landlord is bound, or of any federal or state law; statute, ordinance,
rule or regulation, or of any court or administrative order or process
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7.2 TENANT'S WARRANTIES. Tenant hereby represents and warrants to
Landlord as of the date hereof and as of the Commencement Date the following:
(a) Tenant is a duly organized and validly existing corporation in
the State of Delaware. Tenant has fill power and authority to execute and
deliver this Lease and to carry on the business contemplated by this Lease.
(b) Tenant has the complete and unrestricted authority and power to
enter into this Lease and perform its obligations hereunder. The Lease, when
executed and delivered by Tenant, constitutes the valid and legally binding
obligation. of Tenant, enforceable against Tenant in accordance with its terms;
subject to (i) applicable bankruptcy, insolvency, reorganization, moratorium and
other laws affecting the rights of creditors generally and (ii) the exercise of
judicial discretion in accordance with general principles of equity.
(c) Neither the execution or delivery, nor performance of this Lease
or the other agreements contemplated herein in accordance with their respective
terms, does nor will, after the giving of notice, the lapse of time or
otherwise, conflict with, result in a breach of, or constitute a default under,
the charter or bylaws of Tenant or to the knowledge of Tenant constitute a
default under any contract or other agreement to which Tenant is a party (except
those for which consent has been or will be obtained by the Commencement Date)
or by which Tenant is bound, or of any federal or state law, statute, ordinance,
rule or regulation, or of any court or administrative order or process.
(d) Tenant is not a party to, subject to or bound by, any agreement,
judgment, order, writ, injunction or decree of any court or governmental body
which could prevent the consummation of the transactions contemplated herein.
8. SECURITY DEPOSIT. NOT APPLICABLE.
9. UTILITIES: TRASH REMOVAL.
9.1 TENANT'S DIRECT PAYMENT TO UTILITY PROVIDERS. Tenant shall pay
relevant provider, as they become due, all bills for utilities (whether they
are used for furnishing heat or other purposes) that are furnished directly
to the Leased Property. Tenant all relevant deposits and utility access fees.
9.2 TENANT'S OBLIGATIONS REGARDING ADDITIONAL UTILITIES. Landlord
warrants and represents to Tenant that the following utilities are presently
available to the Leased Property, or will be available upon completion of the
Landlord's Work: water, sewer, gas, electricity, and telephone. Landlord shall
have no obligation to provide utilities or equipment other than the utilities
and equipment within the Leased Property as of the Commencement Date of this
Lease. In the event Tenant requires additional utilities or equipment or
utilities of greater capacity, the
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installation and maintenance thereof shall be Tenant's sole obligation and shall
be performed at Tenant's sole cost and expense, provided that such installation
shall be subject to the prior written consent of Landlord.
9.3 TRASH REMOVAL. Trash generated in the ordinary course of business by
Tenant shall be deposited in dumpster(s) and the cost of this dumpster(s) and
removal of trash from the dumpster(s) shall be the sole responsibility of Tenant
It also shall be the sole responsibility of Tenant to segregate any and all
hazardous waste from the trash deposited in such dumpster and to have such
hazardous waste also removed at its own cost and expense from the Leased
Property by a licensed contractor in accordance with all applicable laws as more
fully detailed in Section 11.5 below.
10. BROKERAGE.
Tenant warrants that it has dealt with no broker in connection with
this Lease other than the Broker or Brokers named in Section 1 above and
agrees to defend and indemnify Landlord against any claim, loss, damage, cost
or expense (including, without limitation, reasonable attorney's fees)
incurred by Landlord on account of any breach of such warranty. Landlord
warrants that it has dealt with no broker in connection with the consummation
of this Lease except the Broker or Brokers named in Section l above, and
agrees to indemnify Tenant against any claim, loss damage, cost or expense
(including, without limitation, reasonable attorney's fees) incurred by
Tenant on account of any breach of such warranty. Landlord will be
responsible for paying any commission or other fees owed to the Brokers named
in Section 1 above.
11. USE OF LEASED PROPERTY: COMPLIANCE WITH LAWS AND FIRE INSURANCE
REQUIREMENTS: HAZARDOUS MATERIALS.
11.1 USE OF LEASED PROPERTY. Tenant acknowledges that no trade or
occupation shall be conducted in the Leased Property or use made thereof other
than the Permitted Use without the prior written consent of Landlord, which
consent shall not be unreasonably withheld or delayed.
11.2 COMPLIANCE WITH LAWS. Landlord shall complete the Landlord's Work
in compliance with all Legal Requirements. Thereafter, Tenant, at its sole
expense, shall comply with all Legal Requirements affecting the Leased Property.
11.3 NO NUISANCE OR OTHER HARMFUL OR DISRUPTIVE ACTIVITY. Tenant shall
not perform any acts or carry on any practices which may injure any part of the
Leased Property, the Property or common areas, violate any certificate of
occupancy affecting the same, constitute a public or private nuisance or a
menace to other tenants on the Property, produce undue noise, create obnoxious
fumes or other odors.
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11.4 COMPLIANCE WITH FIRE INSURANCE REQUIREMENTS. Tenant shall not permit
any use of the Leased Property which will make voidable any insurance on the
Leased Property or which shall be contrary to any law.
11.5 HAZARDOUS MATERIALS. Tenant shall not permit the emission, release,
threat of release or other escape of any Hazardous Materials so as to adversely
affect in any manner, even temporarily, any element or part of the Leased
Property. Tenant shall not use, generate, store or dispose of Hazardous
Materials in or about the Leased Property, or dump, flush or in any way
introduce Hazardous Materials into sewage or other waste disposal systems
serving the Leased Property (nor shall Tenant permit or suffer any of the
foregoing), in any manner not in full compliance with all applicable federal,
state and local statutes, laws, codes, ordinances, by-laws, rules and
regulations for the use, generation, storage and disposal of Hazardous
Materials.
Tenant will indemnify, defend and hold Landlord harmless from and against
all claims, loss, costs and expenses (including, without limitation, reasonable
attorneys' fees and disbursements, diminution in the value of the Leased
Property, costs incurred in connection with any investigation of site conditions
or any clean-up or remedial work required by any federal, state or local
governmental agency) incurred as a result of any breach of Tenant's covenants in
the first paragraph of this Section by Tenant or Tenant's contractors,
licensees, invitees, agents, servants or employees. Without limiting the
foregoing, if the presence of any Hazardous Materials in, on or under the Leased
Property caused or permitted by Tenant results in any contamination of the
Leased Property or the Property, Tenant shall promptly take all actions at its
sole expense as are necessary to return the Leased Property to the condition
existing prior to the introduction of any such Hazardous Material by Tenant,
provided that Landlord's approval of such action shall first be obtained, which
approval shall not be unreasonably withheld so long as such actions would not
potentially have any material adverse long-term or short-term effect on the
Leased Property.
Landlord will indemnify, defend and hold harmless Tenant from and against
all claims, loss, cost and expenses (including, without limitation, reasonable
attorneys fees and disbursements) incurred by Tenant as a result of Hazardous
Materials existing in, on or under the Leased Property as of the Commencement
Date; however, Tenant shall have the burden of proof to establish that such
Hazardous Material was present on or under the Leased Property as of the
Commencement Date.
The obligations of Tenant and Landlord in this Section shall survive the
expiration or earlier termination of this Lease and any transfer of title to the
Leased Property, whether by sale, foreclosure, deed in lien of foreclosure or
otherwise.
For purposes of this Lease, "Hazardous Materials" means, collectively,
any animal wastes, medical waste, blood, biohazardous materials, Hazardous
waste, hazardous substances, pollutants or contaminants, oils, radioactive
materials, asbestos in any form or condition, or any pollutant or contaminant or
hazardous, dangerous or toxic chemicals, materials or substances within the
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meaning of any applicable federal, state or local law, regulation, ordinance or
requirement relating to or imposing liability or standards of conduct concerning
any such substances or materials on account of their biological, chemical,
radioactive, hazardous or toxic nature, all as now in effect or hereafter from
time to time enacted or amended.
12. MAINTENANCE: REPAIRS.
12.1 TENANT'S OBLIGATIONS. Tenant shall, at Tenant's sole cost and
expense, (a) maintain and keep the Leased Property in good repair, good working
order and free of litter and refuse and make any and all repairs and
replacements thereto as and when required, ordinary or extraordinary,
foreseeable or unforeseeable, but specifically excluding any repairs or
replacements required by damage from fire or other casualty (except that Tenant
shall be fully liable and responsible to Landlord for the deductible amount of
any insurance unless the damage to which such insurance claim related was caused
by the negligence or intentional misconduct of Landlord); and (b) periodically
repaint and redecorate the Leased Property as and when required to maintain a
clean and fresh appearance. Landlord understands that the Leased Property will
incur reasonable, normal wear and tear during the term of the Lease and agrees
that Tenant shall not be obligated to repair or replace every incidence of
reasonable and normal wear and tear; however, nothing herein shall relieve
Tenant of its obligations to maintain the Leased Property in good order and
repair.
Further, Tenant shall, at Tenant's sole cost and expense, procure and
maintain contracts, with copies to Landlord, in customary form and substance
for, and with contractors specializing and experienced in, the inspection,
maintenance and service of the following equipment and improvements, if any,
located on the Premises: (i) heating, air conditioning and ventilation
equipment, (ii) boiler, fired or unfired pressure vessels, (iii) fire sprinkler
and/or standpipe and hose or other automatic fire extinguishing systems,
including fire alarms and/or smoke detection, (iv) landscaping, (v) roof
covering and drain maintenance, and (vi) asphalt and parking lot and parking
garage maintenance.
12.2 LANDLORD'S OBLIGATIONS. Landlord agrees to maintain the structural
elements and the roof of the Leased Property in good working order and repair,
reasonable wear and tear, damage by fire and other casualty only excepted.
Further, if such maintenance is required because of the act or negligence of
Tenant or those for whose conduct Tenant is equally responsible and such
maintenance is not covered by insurance, then Tenant shall be responsible for
such maintenance, and if such maintenance is covered by insurance, then Tenant
shall be fully liable and responsible to Landlord for the deductible amount of
any such insurance.
12.3 REMOVAL OF SNOW AND ICE. Removal of snow and ice from the sidewalks,
driveways and parking areas of the Leased Property shall be the responsibility
of Tenant.
12.4 TENANT'S FAILURE TO MAKE REPAIRS. If repairs are required to be made
by Tenant pursuant to the terms hereof, Landlord may demand that Tenant make
the same forthwith, and if Tenant refuses or neglects to commence such repairs
and complete the same with reasonable
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dispatch, after such demand, Landlord may (but shall not be required to do so)
make or cause such repairs to be made (the provisions of Section 20.4 being
applicable to the costs thereof).
12.5 COMPLIANCE WITH AMERICANS WITH DISABILITIES ACT. Landlord will
complete the Landlord's Work in compliance with applicable provisions of the
Americans with Disabilities Act and all of the regulations promulgated
thereunder (collectively, the "ADA"). Thereafter, without in any way limiting
the generality of the obligations set forth in Sections 11.2 and 12.1 above
Tenant also shall comply at Tenant's sole cost and expense with all
provisions of the ADA as they apply to Tenant's use and occupancy of the
Leased Property and the operation of Tenant's business therein and shall be
fully responsible for any modifications or alterations to the Leased Property
necessary to meet requirements of the ADA which have become applicable to the
Leased Property as a result of Tenant's operation of its business within the
Leased Property.
13. ALTERATIONS: LEASED EQUIPMENT OR PERSONAL PROPERTY.
13.1 ALTERATIONS OR ADDITIONS BY TENANT. Tenant shall not make structural
alterations or additions to the Leased Property, but may make non-structural
alterations provided that, in cases involving an expenditure in excess of
Twenty-Five Thousand Dollars ($25,000.00), Landlord gives its prior written
consent thereto, which consent shall not be unreasonably withheld or delayed.
All such allowed alterations shall be at Tenant's sole cost and expense. Tenant
shalt not permit any mechanics' liens, or similar liens, to remain upon the
Leased Property for labor and material furnished to Tenant or claimed to have
been furnished to Tenant in connection with work of any character performed or
claimed to have been performed at the direction of Tenant and shall cause any
such lien to be released of record by bond or otherwise forthwith without cost
to Landlord. Prior to commencement of any alterations or additions to be made by
Tenant, Landlord and Tenant shall agree (which agreement shall not be
unreasonably withheld or delayed by either party) whether such alterations or
improvements will become the property of the Landlord or be removed from the
Leased Premises at the expiration or earlier termination of the Term. All
alterations or additions made by Tenant shall be performed in a good and
workmanlike manner and in compliance with all the applicable laws, ordinances,
orders, rules, regulations and requirements applicable thereto and shall he
performed only by contractors or mechanics approved by Landlord. All such
contractors and mechanics shall carry adequate liability insurance (which shall
name Landlord and Tenant as an additional insured) and workmen's compensation
insurance and Landlord shall be presented with certificates of same prior to the
commencement of any work.
13.2 EQUIPMENT OR PROPERTY LEASED BY TENANT. If requested by Tenant in
writing, Landlord will execute one or more agreements in favor of an equipment
lessor who is leasing equipment or personal property to Tenant for use at the
Leased Property which will allow such equipment lessor to have access to the
Leased Premises to remove such equipment or personal property in the event of
Tenant's default under such equipment lease agreement; however, any such
agreement shall also provide that (a) any such right of entry on behalf of the
equipment lessor shalt terminate as long as there is any uncured Event of
Default relating to the non-payment of any monetary obligations of Tenant lender
this Lease and (b) such equipment lessor shall repair to
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Landlord's reasonable satisfaction any damage to the Leased Property caused by
the equipment lessor's removal of such equipment or personal property.
14. ASSIGNMENT: SUBLEASING.
Tenant shall not assign this Lease or sublet the whole or any part of the
Leased Property without Landlord's prior written consent, which consent shall
not be unreasonably withheld or delayed; it being agreed, however, that Landlord
will give its consent to any sublease or assignment of all or any portion of the
Leased Property to an affiliate (i.e., an entity in common ownership with Tenant
or wholly owned by Tenant or wholly owning Tenant) of Tenant for the Permitted
Use. Notwithstanding such consent, Tenant shall remain liable to Landlord for
the payment of all Base Rent, Additional Charges, any other charges due
hereunder, and for the full performance of the covenants and conditions of this
Lease. Landlord's consent to any such transfer, assignment or sublease will not
be deemed a consent to any subsequent transfer, assignment or sublease. In the
event of a default under the terms of this Lease, if the Leased Property or any
part thereof are then assigned or sublet, Landlord, in addition to any other
remedies herein provided or provided by law, may at its option collect directly
from assignee or subtenant all rents becoming due to Tenant under such
assignment or sublease and apply such rent against any sums due it by Tenant
hereunder, and no such collection shall be construed to constitute a novation or
a release of Tenant from the further performance of its obligations hereunder.
In the event of a permitted sublease. Landlord shall have the right to elect to
share equally in any profit to Tenant from subleasing of the Leased Property.
15. SUBORDINATION TO MORTGAGES: ESTOPPEL CERTIFICATES.
15.1 SUBORDINATION. This Lease shall be subject and subordinate to any
and all mortgages, deeds of trust and other instruments in the nature of a
mortgage, easements or rights of way (provided no such easement or right of way
shall unreasonably interfere with Tenant's use of the Leased Property) now or at
a time hereafter, constituting a lien or encumbrance on the Property and Tenant
shall, when requested, promptly execute and deliver such written instruments as
shall be necessary to show the subordination of this Lease to such mortgages,
deeds of trust or other such instruments and, if requested, an agreement to
recognize any mortgagee as a successor landlord in the event of a foreclosure or
deed in lieu of foreclosure of such mortgage. Failure to execute any such
instruments within twenty (20) days after receipt of an execution copy of the
instrument requested shall constitute a default hereunder. It is the
understanding of the parties hereto that Landlord shall obtain and deliver a
recognition and non-disturbance agreement from the current mortgagee of the
Leased Property as of the date of this Lease and shall use its best efforts to
secure a recognition and non-disturbance agreement with any and all subsequent
lenders requiring such subordination from Tenant or grantees under such other
instruments, but the effectiveness of the other provisions of this Section 15.1
shall not be conditioned in any manner upon the actual receipt of a recognition
and non-disturbance agreement from such subsequent lenders.
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15.2 ESTOPPEL CERTIFICATES. Tenant shall, within ten (10) days after
request from Landlord, deliver to any proposed mortgagee or purchaser of all or
any part of the Property, in recordable form, a certificate certifying and
covenanting any and all information requested, including, but not limited to,
the following: (a) the date of this Lease, the date when the Term of this Lease
commenced, the date of the expiration of the Term, and the date when Base Rent
and Additional Rent commenced to accrue hereunder; (b) that this Lease is
unmodified, not amended, and in full force and effect; or, if there have been
any amendments or modifications, that the Lease is in frill force and effect as
so amended or modified and stating the amendments or modifications and the dates
thereof; (c) whether or not there are, to the best of Tenant's knowledge, then
existing any setoffs or defenses against the enforcement of any of the terms
and/or conditions of this Lease and any amendments or modifications hereof on
the part of Tenant to be performed, and, if so, specifying the same; (d) the
dates, if any, to which the Base Rent, the Additional Rent and other sums on
Tenant's part to be paid hereunder have been paid and/or paid in advance; and
(e) that Tenant has accepted the Leased Property in the condition then existing
and in accordance with the Lease, or Tenant will specify any particular items
which Tenant has not accepted. If Landlord shall submit to Tenant a proposed
instrument containing any of the foregoing information, then, if Tenant shall
fail to respond to Landlord's request for confirmation of the information set
forth therein within twenty (20) days after receipt of such document from
Landlord any information contained in such proposed instrument shall be deemed
to be true, and Tenant shall be deemed to have waived any rights accruing by
reason of any inaccuracy in such proposed instrument. Further, Tenant's failure
or refusal to execute and deliver such certificate within such twenty (20) day
period shall constitute a default under this Lease.
15.3 MORTGAGEE'S CURE RIGHTS. Tenant agrees to provide any mortgagee of
the Leased Property with a copy of any notice given to Landlord alleging a
default by Landlord under this Lease at the same time such notice of default is
given to Landlord, and that in the event of any defaults by Landlord under the
Lease, Tenant will take no action to terminate the Lease (a) if the default is
not curable by such mortgagee (so long as the default does not interfere with
Tenant's use and occupation of the Leased Property) or (b) if the default is
curable by mortgagee, unless the default remains uncured for a period of thirty
(30) days beyond the date on which the Landlord would be obligated to cure such
default under the terms of this Lease; provided, however, that if any such
default is not reasonably capable of cure within such thirty (30) day period,
such period shall be extended for such additional period of time as shall be
reasonably necessary (including, without Limitation, a reasonable period of time
for such mortgagee to obtain possession of the Leased Property), if such
mortgagee gives Tenant written notice within such thirty (30) day period of
mortgagee's election to undertake the cure of such default and if curative
action (including, without limitation, action to obtain possession and foreclose
upon the Leased Property) is instituted within a reasonable period of time and
is thereafter diligently pursued. However, unless such mortgagee so notifies
Tenant as provided in the preceding sentence, no such mortgagee shall have any
obligation to cure any default under the Lease.
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16. LANDLORD'S ACCESS.
Landlord or agents of Landlord may, upon forty-eight (48) hours prior
notice to Tenant (or at any time without notice in the case of emergency), enter
the Leased Property to (a) inspect the same, (b) make alterations as provided
in Section 13.2 above or repairs, (c) show the Leased Property to prospective
lenders at any time and to prospective tenants within one year prior to the
then-scheduled expiration of the Term, and (d) at any time within six (6) months
before the expiration of the Term, affix to any suitable part of the Leased
Property a notice that the Leased Property are available for lease and keep the
same so affixed without hindrance or molestation.
17. INDEMNIFICATION AND LIABILITY.
17.1 DAMAGE TO PROPERTY. Tenant shall save Landlord harmless from all
loss and damage to property occurring within the Leased Property occasioned by
the use or escape of water or by the bursting of pipes, as well as from any
claim or damage resulting from neglect in not removing snow and ice from the
roof of the Leased Improvements, or by any nuisance made or suffered on the
Leased Property. Tenant also agrees to save Landlord harmless from any claim or
damage resulting from neglect in not removing snow and ice from the sidewalks
bordering upon the Leased Property, unless such loss is caused by the
intentional misconduct or negligence of Landlord. Landlord shall not be liable
for any loss or damage arising from any latent defect in the Leased Property
except as may be otherwise expressly and specifically provided herein. All
personal property or improvements of Tenant at or about the Leased Property
shall be installed, used, or enjoyed at the sole risk of Tenant, and Tenant
shall defend, indemnify and hold Landlord harmless from and against any and all
claims and/or causes of action pertaining to or arising out of damage to the
same, including but not limited to subrogation claims, if any, by Tenant's
insurance carrier, but excepting such claims and/or causes of action resulting
from the actual negligence and/or willful and wanton conduct of Landlord.
17.2 INDEMNITY LIABILITY. Tenant shall also indemnify and hold
Landlord harmless, to the fullest extent permitted by law, from and against any
and all claims, actions, loss, damage, liability and expense (including, without
limitation, reasonable attorney's fees and related legal costs incurred by
Landlord) in connection with loss of life, personal injury and/or damage to
property arising out of or resulting from any occurrence in, upon or at the
Leased Property or the occupancy or use of the Leased Property or any part
thereof, or anywhere on or about the Property if caused wholly or in part by any
act, neglect or failure to perform the obligations imposed by this Lease or any
breach thereof, or omission of Tenant, its officers, agents, employees,
subtenants, licensees, concessionaires, or others occupying space in the Leased
Property.
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18. INSURANCE.
18.1 INSURANCE TO BE MAINTAINED BY TENANT. At its own cost and expense,
Tenant shall obtain and maintain throughout the Term of this Lease the following
insurance coverage: (a) comprehensive general public liability insurance
covering claims for injury to persons or property occurring in or about the
Leased Property, or arising out of ownership, maintenance, use, or occupancy
thereof by the Tenant, with limits of One Million Dollars ($1,000,000.00) per
occurrence and Three Million Dollars ($3,000,000.00) in the aggregate, with an
excess liability policy of at least Twenty-Five Million Dollars
($25,000,000.00); (b) all risk hazard insurance including and not limited to
fire, extended coverage, vandalism and malicious mischief insurance, covering
any and all of the Leased Property, in the full amount of the stated amount
requirements of Landlord's mortgagee, including inflation protection; (c)
Worker's Compensation and all other insurance coverages for employees, agents,
servants, and others at or about the Leased Property in compliance with and as
required by any and all applicable governmental regulations and statutes; and
(d) rental insurance in the amount which corresponds to the Base Rent for the
respective year of the Term. Landlord may from time to time require Tenant to
maintain other insurance coverage or may increase the amount of the foregoing
insurance to be maintained by Tenant so as to provide insurance coverage in
forms and amounts consistent with the extent of coverage' maintained by similar
tenants in similar buildings located in the vicinity of the Leased Property.
18.2 OTHER INSURANCE REQUIREMENTS; WAIVER OF SUBROGATION. All such
insurance procured by Tenant as provided herein shall be in responsible
companies (i.e., a company having a Best's rating of at least A-, provided
that a lower rating will be accepted if it is acceptable to the mortgagee of
the Leased Property) qualified to do business in Massachusetts and in good
standing therein, insuring Landlord and Landlord's mortgagee (if any) as well
as Tenant against injury to persons or damage to property as herein provided.
Tenant shall deposit with Landlord certificates for such insurance at or
prior to the Commencement Date, and thereafter within thirty (30) days prior
to the expiration of any such policies. All such insurance certificates shall
provide that such policies shall not be cancelled or modified without at
least ten (10) days prior written notice to each insured named therein.
Insofar as, and to the extent that, the following provision may be effective
without invalidating or making it impossible to secure insurance coverage
obtainable from responsible insurance companies doing business in the
locality in which the Property is located (even though an extra premium may
result therefrom), Landlord and Tenant mutually agree that, with respect to
any hazard, the loss from which is covered by insurance then being carried by
them, respectively, the party carrying such insurance and suffering such loss
releases the other of and from any and all claims with respect to such loss
to the extent of the insurance proceeds paid with respect thereto; and they
further mutually agree that their respective insurance companies shall have
no right of subrogation against the other on account thereof.
18.3 ESCROW FOR INSURANCE PREMIUMS. (a) Notwithstanding any of the
foregoing, in the event that any mortgagee of the Leased Property requires
Landlord to escrow insurance
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payments or in the event that Landlord elects to purchase property and liability
insurance for the Leased Property directly as a result of Tenant's failure to do
so, Tenant shall also pay to Landlord, as Additional Rent, die full amount of
all premiums for property and liability insurance maintained by Landlord with
respect to the Leased Property. Payments by Tenant on account of such insurance
premiums shall be made monthly at the time and in the fashion herein provided
for the payment of Base Rent and shall be in an amount, specified by Landlord
in a notice given by Landlord to Tenant, from time to time reasonably estimated
by Landlord to be sufficient, if paid monthly, to aggregate a sum equal to the
total insurance premiums paid by Landlord in connection with the Leased
Property.
(b) Not later than ninety (90) days after the end of each calendar year
or fraction thereof during the Term or fraction thereof at the end of the Term,
Landlord shall render Tenant a statement in reasonable detail and according to
usual accounting practices certified by a financial officer of Landlord, showing
for the preceding calendar year or fraction thereof, as the case may be, the
total insurance premiums paid by Landlord in connection with the Premises. Said
statement to be rendered to Tenant also shall show for rho' preceding calendar
year or fraction thereof, as the case may be; the amounts of insurance premiums
already paid by Tenant. If at the time such statement is rendered it is
determined with respect to any calendar year that Tenant has paid (i) less or
(ii) more than the total insurance premiums for the relevant period, then, in
the case of (i), Tenant shall pay to Landlord; as Additional Rent, within
fifteen (15) days after such statement, the amounts of such underpayment, and,
in the ease of (ii), Landlord shall credit the amount of such overpayment
against the monthly installments of annual Base Rent and Additional Rent next
thereafter coming due (or refund such overpayment if the Term has expired and
Tenant has no further obligation to Landlord).
19. FIRE: CASUALTY: EMINENT DOMAIN.
19.1 DAMAGE BY CASUALTY. Should more than fifty percent (50%) of the
floor space of the Leased Improvements be substantially damaged by fire or other
casualty, Landlord may elect to terminate this Lease. When such fire or casualty
renders the Leased Property substantially unsuitable for its intended use, a
just and proportionate abatement of rent shall be made. Further; within thirty
(30) days after such fire or other casualty, Landlord shall give written notice
to Tenant with respect to whether or not Landlord will restore the Leased
Property. Tenant may elect to terminate this Lease if either (a) Landlord
notifies Tenant that Landlord has elected not to restore the Leased Property, or
(b) Landlord elects to restore but fails to restore the Leased Property to a
condition substantially suitable for its intended use with one hundred eighty
(180) days after such fire or casualty. However, Tenant's failure to give such
notice of termination within five (5) days after the date on which the right to
terminate ripens under either (a) or (b) above shall constitute a waiver of such
right by Tenant. Landlord will use its best efforts to cause the first
mortgagee of the Leased Property, if any, to allow application of hazard
insurance loss proceeds to the repair or reconstruction of the Leased Property
upon any hazard loss. Notwithstanding the foregoing, in the event such mortgagee
shall not make the insurance loss proceeds available for repair or restoration,
Landlord shall not be required to repair or
19
reconstruct the Leased Property and shall notify Tenant within thirty (30) days
next following such hazard loss, of its election in this respect and thereupon,
Tenant shall have the termination rights described above in this Section 19.1.
19.2 "COMPLETE" TAKING OF LEASED PROPERTY. If, prior to the Commencement
Date or otherwise, the Leased Property shall be taken in its entirety under any
condemnation or eminent domain proceedings (each such occurrence being
hereinafter referred to as a "Taking") by any governmental authority (the
"Taking Authority") during the Term hereof, this Lease shall terminate.
Similarly, if there is a Taking of the Leased Property where, even after
restoration of the Leased Property to the maximum extent feasible under the
circumstances, either (a) more than thirty percent (30%) of the floor space of
the Leased Improvements has been eliminated by such Taking or (b) more than
twenty-five (25) parking spaces have been eliminated by such Taking or (c)
parking spaces are reduced below the number required for compliance with local
zoning or (d) access to and from the Leased Improvements and Constitution Drive
has been eliminated, then provided that no Event of Default (or set of
circumstances which could constitute and Event of Default, with the giving of
notice) then exists, Tenant may terminate this Lease on thirty (30) days prior
written notice given to Landlord within thirty (30) days after the date of such
Taking. In the event of a termination pursuant to either of the preceding two
sentences, this Lease and the Term hereof shall terminate and Tenant
shall be liable for the payment of Base Rent. Additional Charges and all other
charges due from Tenant hereunder, and performance of the other terms and
conditions of this Lease on Tenant's part to be performed only up to date of
such termination, and any Base Rent paid in advance for periods following such
date shall be apportioned and promptly refunded to Tenant.
19.3 "PARTIAL" TAKING OF LEASED PROPERTY. In the event of a Taking that
does not result in a termination of this Lease as provided in Section 19.2
above, and either (a) the mortgagee of the Leased Property shall not make the
proceeds of any awards or damages payable as to the Taking available for
restoration and repair of the Leased Property, or (b) Landlord shall determine
in its reasonable discretion that the restoration and repair of the Leased
Property shall be impracticable, or (c) the Taking occurs within the last
eighteen (18) months of the initial Term (or of a renewal term, if any),
Landlord shall be entitled to terminate this Lease by reason of such Taking
without liability to Tenant. If Landlord does not so terminate this Lease, this
Lease shall continue in effect and Landlord shall rebuild and restore the Leased
Property as nearly as possible to the condition existing next preceding such
Taking, with due allowance for the portion so taken. Further, Tenant shall
promptly restore or repair any improvements made by it in the Leased Property to
the extent proceeds from such awards are made available to Tenant for such
purpose and this Lease shall be and remain in full force and effect and be
unaffected by, the Taking, except that from the date possession of the taken
portion of the Leased Property is acquired by the Taking Authority, the Base
Rent payable under this Lease shall be diminished by the Fair Market Rental
Value of the portion of the Leased Property so taken. The restoration or repair
work to be done by Tenant shall be done subject to any and all terms and
conditions elsewhere set forth in this Lease governing alterations or work on
Tenants part to be performed.
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19.4 MISCELLANEOUS PROVISIONS REGARDING CASUALTY OR TAKING.
19.4.1 In the event this Lease is terminated or terminates by
reason of a Taking or a Casualty, the provisions of the Lease applicable upon
expiration of the Lease shall govern the parties, except for those provisions
which, by their nature, are affected by the Casualty or Taking such that
their performance is not equitable under the circumstances.
19.4.2 Landlord will seek to have any mortgagee of the Leased
Property provide for application of the proceeds of any Taking awards to
restoration, repair, and reconstruction of the portion of such property
remaining after the Taking Notwithstanding the amount of land, building or
improvements taken by condemnation or eminent domain or the termination or
continuance of this Lease with respect thereto, Tenant shall not participate
or share in any recovery, award, or damages payable or paid as to such
Taking, nor have or assert any right, claim, or cause of action against
Landlord, the fee owner, or mortgagee of the Leased Property or, except as
expressly provided in Section l9.4.3 below, the Taking Authority whether for
the loss of or diminution in value of, the unexpired Term of this Lease, or
as to the Taking of any such land, building, and/or improvements or
otherwise; and Tenant for itself and its successors and assigns hereby
waives, surrenders, and releases to Landlord any and all claims or rights to
claim or receive all or any portion of any and all recovery, awards, and/or
damages as to such Taking.
19.4.3 If permitted by statute, Tenant may assert a separate and
independent claim for and recover from the Taking Authority but not from
Landlord, any compensation as may be separately awarded or recoverable by
Tenant in its own name and right for relocation expenses or any damage to
Tenant's portable fixtures and equipment, or on account of any expenses which
it shall incur in removing its merchandise, furnishings, and equipment from
the Leased Property, but in no event shall any such claims or recoveries be
claims or asserted in the event the same would, may, or shall diminish,
offset, or bar any damages, recovery, or award to Landlord or the fee owner
of the Leased Property.
20. DEFAULT: REMEDIES: BANKRUPTCY
20.1 EVENTS OF DEFAULT. Each of the following shall be an event of
default ("Event of Default") under this Lease:
20.1.1 Tenant shall default in the payment of any installment of
Rent or other sum herein specified and such default shall continue for five (5)
days after written notice thereof provided, however, that Landlord shall not be
required to give more than one (1) such notice during any consecutive twelve
(12) month period with regard to defaults in the payment of installments of Base
Rent, or any other sums due under this Lease, and in the event that Landlord has
already given one (1) such notice during any consecutive twelve (12) month
period, any subsequent failure of Tenant during such twelve (12) month period to
make any payment due hereunder shall immediately constitute a default even
though no notice has been given:
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20.1.2 Tenant shall fail to maintain insurance as required by this
Lease:
20.1.3 Tenant shall default in the observance or performance of any
other of Tenant's covenants, agreements, or obligations hereunder and such
default shall not be cured within thirty (30) days after written notice thereof,
or if such default is of a nature that it cannot be reasonably cured within such
thirty (30) day period, Tenant shall not have commenced to cure such default
within said thirty (30) day period and diligently proceed to completion of said
cure, provided such extended period without a completed cure will not have a
material adverse effect on the value of the Leased Property or expose Landlord
to any liability; provided however, that Landlord shall not be required to give
more than two (2) notices during any consecutive twenty-four (24) month period
with regard to Tenant's failure to perform its obligations under a particular
Section of' this Lease (a 'Previously Defaulted Provision") and in the event
that Landlord has already given two (2) such notices during any consecutive
twenty-four (24) month period, any subsequent failure of Tenant during such
twenty-four (24) month period to fully and punctually observe such Previously
Defaulted Provision shall immediately constitute a default even though no notice
has been given; or
20.1.4 Tenant or any other party shall file a petition or
application lender any state or federal bankruptcy, insolvency or debtor's
relief law relating to Tenant or Tenant shall consent to an assignment or
composition for the benefit of Tenant's creditors or consent to the appointment
of a receiver for any of Tenant's property; provided, however, that if such
petition, application or receivership proceedings are instituted against Tenant
by a third party, there shall be no default hereunder unless the same shall
remain undischarged for a period of greater than sixty (60) days from the filing
of such petition or application or the commencement of the receivership
proceedings, as the case may be.
20.2 LANDLORD'S REMEDIES. Upon the occurrence of an event of default,
Landlord shall have the following rights and remedies:
20.2.1 Landlord shall have the right at its election, at any time
thereafter, to give Tenant written notice of Landlord's election to terminate
this Lease on a date specified in such notice. Upon the giving of such notice,
this Lease and the estate hereby granted shall expire and terminate on such date
as fully and completely and with the same effect as if such date were the date
hereinbefore fixed for the expiration of the Term, and all rights of Tenant
hereunder shall expire and terminate, but Tenant shall remain liable as
hereinafter provided.
20.2.2 Landlord shall have the immediate right to reenter and
repossess the Leased Property or any part thereof by summary or other judicial
proceedings and the right to remove all persons and property therefrom. Landlord
shall be under no liability for or by reason of any such entry, repossession or
removal. No such re-entry or taking of possession of the Leased Property by
Landlord shall be deemed to waive or prejudice any remedies provided to Landlord
hereunder, nor be construed as an election on Landlord's part to terminate this
Lease
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unless a written notice of such election be given to Tenant pursuant to Sections
20.2.1 and 21 or unless the termination of this Lease be decreed by a court of
competent jurisdiction.
20.2.3 Landlord may relet the Leased Property or any part thereof
for the account of Tenant in the name of Tenant or Landlord or otherwise,
without notice to Tenant, for such term or terms (which may be greater or less
than the period which would otherwise have constituted the balance of the Term)
and on such conditions (which may include free rent and any other concessions)
and for such uses as Landlord, in its absolute discretion reasonably exercised,
may determine; and Landlord may collect and receive any rents payable by reason
of such reletting. Landlord shall not be responsible or liable for any failure
to relet or to collect any rent due upon such reletting.
20.2.4 In the event of any termination of this Lease by reason of
the occurrence of an Event of Default, Tenant will pay to Landlord the Base
Rent, and any Additional Charges and other sums required to be paid by Tenant
for the period to and including the date of such termination.
20.2.5 Landlord shall be entitled to recover from Tenant, and Tenant
will pay to Landlord on demand, as and for liquidated and agreed final damages
for Tenant's default and in lieu of all current damages beyond the date of
termination (it being agreed that it would be impracticable or extremely
difficult to fix the actual damages), an amount equal to the excess, if any, of
the present value of the excess of (a) the total of (i) the Base Rent, any
Additional Charges and other sums which would be payable under this Lease from
the date of such termination for what would be the then unexpired Term in the
absence of such termination plus (ii) the aggregate of all expenses relating to
Landlord's reletting the Leased Property, including, without limitation,
brokerage fees and the cost of any alterations needed to relet, over (b) the
then net fair rental value of the Leased Property for the same period (after
deducting from such fair rental value the time needed to relet the Leased
Property in the amount and concessions which would normally be given to a new
tenant). Fair rental value shall be established in accordance with the appraisal
procedures set forth in EXHIBIT FMRV.
20.3 LANDLORD'S CURE RIGHTS. If Tenant shall default in the observance or
performance of any conditions or covenants on Tenant's part to be observed or
performed under or by virtue of any of the provisions of this Lease and such
default shall continue beyond any period provided in this Lease for Tenant to
cure such default, Landlord, without being under any obligation to do so and
without thereby waiving such default, may remedy such default for the account
and at the expense of Tenant.
20.4 TENANT'S OBLIGATION TO REIMBURSE LANDLORD. If Landlord makes any
expenditures (pursuant to Section 20.3 above or otherwise) or incurs any
obligations for the payment of money in connection with any failure of Tenant to
perform fully all of its obligations under this Lease, which failure continues
beyond any period provided in this Lease for Tenant to cure such default, such
sums paid or obligations incurred (including but not limited to,
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reasonable attorney's fees and court costs in instituting, prosecuting or
defending any action or proceeding), with interest at the rate of one and one
half percent (1-1/2%) per month and costs, shall upon demand be paid to Landlord
by Tenant as an Additional Charge
20.5 NO WAIVER. Landlord's failure to take action against Tenant with
respect to any default in Tenant's performance of its obligations hereunder
shall not, under any circumstances, constitute a waiver of any of Landlord's
rights under this Lease and, further, no waiver of any of the provisions of this
Lease shall be effective unless given in writing nor shall any waiver be
construed as a waiver of any of the other provisions hereof or as a waiver of
the same provisions for any subsequent time,
20.6 ACCEPTANCE OF LATE PAYMENTS. No payment by Tenant, or acceptance by
Landlord, of a lesser amount than then due from Tenant to Landlord shall be
treated otherwise than as a payment on account regardless of any letter
accompanying such check or legend entered upon such check. Further, no
acceptance of any payment by Landlord from Tenant shall in any way constitute a
waiver of any default then existing or which would exist with the proper giving
of notice.
20.7 INTEREST ON LATE PAYMENTS. If Tenant shall fail to pay, when the
same is due and payable, any Base Rent, Additional Rent, Additional Charges or
any other charges or payments required hereunder (excluding the payments
described in Section 20.4 above), such unpaid amounts shall bear interest from
ten (10) days after the due date thereof to the date of payment at the annual
rate of interest of twelve percent (12%) per annum, but in no event higher than
the maximum rate permitted by law; and, in addition, Tenant shall pay Landlord a
late charge for any Base Rent, Additional Rent, Additional Charges or any other
charges or payments due hereunder which is paid more than ten (10) days after
its due date equal to five percent (5%) of such payment.
20.8 REMEDIES CUMULATIVE. Any and all remedies set forth in this Lease
(a) shall be in addition to any and all other remedies Landlord may have at law
or in equity, (b) shall be cumulative, and (c) may be pursued successively or
concurrently as Landlord may elect. The exercise of any remedy by Landlord shall
not be deemed an election of remedies or preclude Landlord from exercising any
other remedies in the future.
20.9 LANDLORD'S RIGHTS IN TENANT'S BANKRUPTCY. If this Lease is assigned
to any person or entity pursuant to the provisions of the Bankruptcy Code, 11
U.S.C. 101 ET SEQ. as now existing or hereafter amended (the Bankruptcy Code"),
any and all monies or other considerations payable or otherwise to be delivered
in connection with such assignment shall be paid and delivered to Landlord,
shall be and remain the exclusive property of Landlord and shall not constitute
property of Tenant or of the estate of Tenant within the meaning of the
Bankruptcy Code. Any and all monies or other considerations constituting
Landlord's property under the preceding sentence not paid or delivered to
Landlord shall be held in trust for the benefit of Landlord and be promptly paid
to or turned over to the Landlord. Notwithstanding anything in
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this Lease to the contrary, all amounts payable by Tenant to or on behalf of
Landlord under this Lease, whether or not expressly denominated as rent,
including, without limitation, the Base Rent and Additional Rent specified
herein, shall constitute rent for the purpose of Section 502(b)(7) of the
Bankruptcy Code.
If Tenant assumes this Lease and proposes to assign the same pursuant to
the provisions of the Bankruptcy Code to any person or entity who shall have
made a bona fide offer to accept an assignment of this Lease on terms acceptable
to Tenant, then notice of such proposed assignment, setting forth (a) the name
and address of. such person; (b) all of the terms and conditions of such offer,
and (c) the adequate assurance to be provided Landlord to assure such person's
future performance under the Lease, including without limitation, the assurance
referred to in Section 365(b)(3) of the Bankruptcy Code, shall be given to
Landlord by the Tenant no later than twenty (20) days after receipt by the
Tenant, but in any event no later than ten (10) days prior to the date that the
Tenant shall make application to a court of competent jurisdiction for authority
and application to enter into such assignment and assumption, and Landlord shall
thereupon have the prior right and option, to be exercised by notice to the
Tenant given at any time prior to the effective date of such proposed
assignment, to accept an assignment of this Lease upon the same terms and
conditions and for the same consideration, if any, as the bona fide offer made
by such person, less any brokerage commissions which may be payable out of the
consideration to be paid by such person for the assignment of this Lease. Any
person or entity to which this Lease is assigned pursuant to the provisions of
the Bankruptcy Code shall be deemed without further act or deed to have assumed
on and after the date of such assignment all of the obligations arising under
this Lease. Any such assignee shall upon demand execute and deliver to Landlord
an instrument confirming such assumption.
21. NOTICES.
Any and all notices, demands, consents or approvals required hereunder
shall be given in writing in accordance with this Section 21. Any notice from
Landlord to Tenant shall be deemed duly served, if delivered by overnight
courier, or by registered or certified mail, return receipt requested, postage
prepaid to Tenant's Mailing Address (as defined in Section 1 above) or if sent
by telefax transmission to (000) 000-0000 with confirmation of receipt of such
telefax transmission. Any notice from Tenant to Landlord shall be deemed duly
served, if delivered to Landlord by overnight courier, or by registered or
certified mail, return receipt requested, postage prepaid, addressed to Landlord
at Landlord's Mailing Address (as defined in Section 1 above) or sent to
Landlord by telefax transmission to (000) 000-0000. Either Landlord or Tenant
may change their respective Mailing Address or telefax transmission number by
notice given to the other party in accordance with this Section 21.
22. SURRENDER: HOLDING OVER.
22.1 SURRENDER OF LEASED PROPERTY. Tenant shall, at the expiration or
other termination of the Term, (a) remove all of Tenant's goods and effects from
the Leased Property
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(including, without hereby limiting the generality of the foregoing, all signs
and lettering affixed or painted by Tenant either inside or outside the Leased
Property), and (b) deliver to Landlord the Leased Property, in broom clean
condition, and otherwise in the same condition as existed as of the Commencement
Date (normal wear and tear in accordance with Section 12.1 above and damage by
fire or other casualty excepted), all keys, locks thereto, other fixtures
connected therewith and all alterations and additions made to or upon the Leased
Property. Upon Tenant's failure to comply with the preceding sentence, Landlord
is hereby authorized, without liability to Tenant for loss or damage thereto,
and at the sole risk of Tenant, to remove and store any of such property at
Tenant's expense, or to retain same under Landlord's control or to sell, at
public or private sale, without notice, any or all of such property not so
removed and to apply the net proceeds of such sale to the payment of any sum due
hereunder, or to destroy such property.
22.2 HOLDING OVER. If Tenant remains in Possession of the Leased Property
or any part thereof after the expiration or earlier termination of the Term of
this Lease, Tenant shall be deemed to be in use and Occupancy of the Leased.
Property as a month-to-month tenant at a rate of monthly rent one and one-half
(1 1/2) times the rate of the total monthly installment of Base Rent then in
effect upon the date of expiration or termination of this Lease and subject to
the same terms and conditions (including, without limitation, provisions
concerning the payment or all other charges hereunder) as those set forth in
this Lease other than as to the length of Term However, nothing in this Lease
provision shall be deemed to extend the Term beyond that set forth in Section 2
hereof, nor grant any right to Tenant or any other person to use, occupy, or
remain in Possession of all or any part of the Leased Property beyond the
expiration or earlier termination of the Term of this Lease.
23. LANDLORD'S LIABILITY.
23.1 NO CONSEQUENTIAL DAMAGES. In no event shall either Landlord or
Tenant ever be liable to the other for any loss of business or any other
indirect or consequential damages suffered by such other party as a result of
the defaulting party's breach of its obligations under this Lease.
23.2 LIABILITY AFTER CONVEYANCE OF PROPERTY. The term "Landlord," as used
herein, shall mean and refer to the owner of the fee estate in the Leased
Property whosoever such owner may be from time to time or to the person or
entity named as Landlord above or its successors or assigns, as the case may be;
and upon any conveyance or transfer of the interest of such person or entity as
Landlord, such person or entity shall be thereupon released and discharged from
any and all liability under this Lease or otherwise to Tenant and any and all
others whomsoever except for breaches of this Lease occurring prior to such
transfer.
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24. MISCELLANEOUS.
24.1 GOVERNING LAW. This Lease shall be governed by the law of the
Commonwealth of Massachusetts and shall be deemed to have been made, executed,
delivered and accepted by the respective parties in that state.
24.2 PARTIAL INVALIDITY. If any term or provision of this Lease, or the
application thereof to any person or circumstance shall to any extent be invalid
or unenforceable, the remainder of this Lease, or the application of such term
or provision to persons Or circumstances other than those as to which it is held
invalid or unenforceable, shall not be affected thereby, and each term and
provision of this Lease shall be valid and be enforced to the fullest extent
permitted by law. It is the intention of the parties hereto that if any
provision of this Lease is capable of two constructions, one of which would
render the provision valid, then the provision shall have the meaning which
renders it valid.
24.3 CAPTIONS. The captions of this Lease are for convenience and
reference only and shall not be deemed or construed to bind, modify, increase,
or decrease the terms and conditions of this Lease, or any interpretation or
construction thereof.
24.4 SUCCESSORS AND ASSIGNS. The terms and conditions in this Lease shall
apply to and be binding upon the parties herein and their respective successors
and assigns except as expressly otherwise provided.
24.5 RECORDING OF LEASE. Tenant shall not record this Lease. However at
the request of either party, Landlord and Tenant shall executor acknowledge,
deliver, exchange, and record at the requestor's expense a Notice of Lease in
the form attached hereto as EXHIBIT NL.
24.6 ENTIRE AGREEMENT. This Lease and any and all exhibits and. riders
attached hereto and made a part of this Lease constitute the entire agreement of
the parties concerning this Lease, and any and all other or prior agreements,
representations, or warranties are hereby terminated, cancelled, and agreed to
be void and of no force or effect.
24.7 AMENDMENTS. No change, amendment, deletion, or addition to this
Lease shall be effective unless in writing and signed by the parties.
24.8 QUIET ENJOYMENT. So long as Tenant is not in default of any of its
obligations under this Lease, beyond any applicable grace period, Tenant shall
peaceably and quietly have, hold and enjoy the Leased Property free of any
claims by, through or under Landlord.
24.9 NO PARTNERSHIP. Nothing in this Lease shall create or be construed
to create a between Tenant and Landlord, or make them joint ventures, or bind
or make any way liable or responsible for any acts, omissions, negligence, debts
or obligations of Tenant.
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24.10 TIME OF ESSENCE. Time is of the essence in this Lease.
24.11 PURCHASE OPTION. Tenant shall have the option to purchase the
Leased Property (the "Purchase Option") on the following dates and for the
following respective prices on each such date: January 15, 2000 at the price of
$4,900,000 (which the parties reasonably estimate to represent 87(pound) 5% of
Fair Market Value of the Leased Property); on January 15, 2003 at the price of
$5,275,000; and on January 15, 2005 at the price of $5,550,000 (each such date
being hereinafter referred to as the "Purchase Option Date," and each such
dollar amount being hereinafter referred to as the "Option Price"). The Purchase
Option shall also be subject to the following terms:
(a) CONDITIONS TO OPTION. On the conditions (which conditions
Landlord may waive, at its sole option, by notice to Tenant at any time) that
(i) at the time of exercise of the Purchase Option and on the Option Closing
Date (defined below), there then exists no uncured Event of Default regarding
the payment of money, and Landlord has not given notice of any fact or
circumstance that remains uncured which if not cured during the appropriate
grace period would constitute an Event of Default; and (ii) Tenant strictly
complies with the provisions of this Section 24.11. then Tenant shall have the
right to exercise the Purchase Option.
(b) NOTICE. Tenant shall give Landlord written notice of Tenant's
election to exercise the Purchase Option at least one hundred eighty (180) days
prior to the relevant Purchase Option Date.
(c) CONVEYANCE. It the Purchase Option is exercised by Tenant in
accordance with the terms hereof then, subject to the conditions of subsection
(g) below, Landlord shall convey to Tenant good and clear record and marketable
title to the Leased Property by delivery to Tenant of a duly executed and
acknowledged quiteclaim deed (the "Deed"), subject to all Existing Encumbrances
listed on EXHIBIT EE attached hereto as well as any other encumbrances created
during the term of this Lease by Landlord with the consent of Tenant (however,
in no event shall the Leased Property be subject to any voluntary monetary
encumbrances created by Landlord).
(d) PAYMENT OF OPTION PRICE. The Option Price shall be paid by Tenant
on the Option Closing Date by certified, cashier's, treasurer's or bank check(s)
or wire transfer pursuant to instructions received from Landlord.
(e) PLACE AND TIME OF CLOSING. If this Purchase Option is exercised,
the closing shall occur and the Deed shall be delivered (the "Closing") at the
office of Landlord at 12:00 o'clock noon (E.S.T.)) on the relevant Purchase
Option Date (such time, as the same may be extended by mutual written agreement
of Landlord and Tenant, being hereinafter referred to as the "Option Closing
Date"). It is agreed that time is of the essence of this Purchase Option.
(f) CONDITION OF LEASED PROPERTY. The Leased Property is to be
purchased "AS IS" and "WHERE IS" as of the Option Closing Date.
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(g) QUALITY OF TITLE. If Landlord shall be unable to give title or to
make conveyance, as stipulated in this Section 24.11, then, Landlord shall use
reasonable efforts to remove all defects in title and the Option Closing Date
shall be extended for period of ninety (90) days. Landlord shall not be required
to expend more than THIRTY THOUSAND and NO/100 DOLLARS ($30,000.00) (inclusive
of attorney's fees) in order to have used 'treasonable efforts." However,
Landlord's obligation to remove any voluntary encumbrances on the Leased
Property created by Landlord from the date of this Lease (except those
encumbrances for which Tenant has given its express approval at the time of the
creation of the same other than voluntary monetary encumbrances created by
Landlord) shall not be limited to reasonable efforts only.
(h) LANDLORD'S INABILITY TO PERFORM: LANDLORD'S DEFAULT. If at the
expiration of the extended time Landlord, after having complied with its
obligations under subsection (g) above, shall have failed so to remove any such
defects in title, then all other obligations of all parties hereto under this
Section 24.11 shall cease and this Section 24.11 shall be void and without
recourse to the parties hereto, but this Lease shall otherwise continue in full
force and effect. Notwithstanding the foregoing, Tenant shall have the election,
at either the original or extended Option Closing Date, to accept such title as
Landlord can deliver to the Leased Property in its then condition and to pay
therefor the Option Price without reduction, in which case Landlord shall convey
such title; PROVIDED, THAT, in the event of such conveyance, if any portion of
the Leased Property shall have been taken by exercise of the power of
condemnation prior to the Option Closing Date, Landlord shall pay over or assign
to Tenant at the Option Closing Date, all awards recovered on account of such
taking, less any amounts reasonably expended by Landlord in obtaining such
award, or, to the extent such awards have not been recovered as of the Option
Closing Date, Landlord shall assign to Tenant all its rights with respect to any
claim therefor If Landlord wilfully fails to perform its obligations under
subsection (f) or for any other reason wilfully and without excuse fails to
deliver the Deed, then Tenant shall be entitled to xxx for specific performance
of Landlord's obligations to convey the Leased Property and shall be entitled to
all reasonable costs and expense associated with such suit (including, without
limitation, reasonable attorney's fees).
(i) USE OF OPTION PRICE TO CLEAR TITLE. To enable Landlord to make
conveyance as provided in this Section 24.11, Landlord may, at the Closing, use
the Option Price or any portion thereof to clear the title of any lien; provided
that all instruments so procured are recorded contemporaneously with the Closing
or reasonable arrangements are made for a recording subsequent to the Option
Closing Date in accordance with customary conveyancing practices.
(j) TENANT'S DEFAULT. If Tenant delivers a notice to Landlord
exercising the Purchase Option and then fails to consummate the purchase of the
Leased Property in accordance with the terms hereof for any reason other than
Landlord's inability to perform its obligations or Landlord's wilful and
unexcused failure to comply with the provisions of this Section 24.11, Tenant
shall thereafter have no farther right to purchase the Leased Property, although
this Lease shall otherwise continue in full force and effect.
24.12 FINANCIAL STATEMENTS. On or before April 30 of each year during the
Term of this
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Lease, Tenant shall provide to Landlord and Landlord's mortgagee copies of
Tenant's certified financial statements for the immediately preceding calendar
year which have been prepared for Tenant by Tenant's independent certified
public accountant.
25. CONSTRUCTION OF TENANT IMPROVEMENTS.
Landlord shall perform the work (the "Landlord Work") described in
EXHIBIT LW attached hereto in a good and workmanlike manner.
The term of this Lease shall commence (the "Commencement Date") fourteen
(14) days after the date Landlord shall have substantially completed the
Landlord Work (that is, has completed the Landlord Work, except for normal
"punch list" items) and shall have delivered to Tenant a copy of either (i) a
permanent Certificate of Occupancy for the Leased Property from the appropriate
building official of the City of Taunton, Massachusetts or (ii) a Temporary
Certificate of Occupancy for the Leased Property from such official, provided
that such Temporary Certificate of Occupancy contains no conditions which would
render the Premises unusable by Tenant for the Permitted Use.
In the event the Landlord's Work is not completed on or before December
31, 1997, Tenant shall have the right to terminate its obligations under this
Lease by giving written notice of such termination to Landlord on or before
February 1, 1998; provided, however, that (1) such dates shall be extended for a
period equal to the duration of any delays in construction caused by strikes,
shortages or materials, acts of God or other matters not reasonably within the
control of Landlord, and (2) in the event any delays in completing the
Landlord's Work are as a result of change orders or other delays caused by
Tenant. The foregoing dates shall be extended day for day for each such delay
caused by Tenant or longer if appropriate to compensate for additional delays
which were encountered on account of items enumerated in (1) above that would
not otherwise have been encountered but for the Tenant-caused delays. Tenant's
failure to give such notice of termination on or before February 1, 1998 (or
such later date as extended pursuant to (1) or (2) above) shall constitute a
waiver of such termination right with the result that February 1, 1998 (or such
later date as extended pursuant to (1) or (2) above) shall become the
Commencement Date.
Thirty (30) days after the Commencement Date, Landlord shall be deemed to
have satisfactorily completed the construction of the Landlord Work, and Tenant
shall be deemed to have waived all rights and remedies with respect to
deficiencies in such construction, except for (a) deficiencies in the HVAC
system of which Tenant has informed the Landlord in writing not later than three
hundred sixty-five (365) days following the Commencement Date, (b) deficiencies
of any other type of which Tenant has informed Landlord, in writing, not later
than thirty (30) days following the Commencement Date, and (c) latent defects in
the roof or structural integrity of the building constructed as part of the
Landlord Work. Further, with respect to any portions of the Landlord's Work for
which Landlord has received a guaranty or warranty from the general contractor
or subcontractor performing such work, Tenant shall have the full benefit of
such warranty or guaranty as long as Tenant gives Landlord written notice of
such defect or deficiency in a timely manner so that Landlord is capable of
making a timely claim under the guaranty or warranty in question.
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26.1 Landlord and Tenant acknowledge that Landlord intends to enter into
agreements with the Massachusetts Development Finance Agency ("MDFA") providing
for the issuance of industrial revenue bonds in a principal amount of
approximately $4,175,000 (the "Bonds") pursuant to Chapters 23A and 40D of the
Massachusetts General Laws. The proceeds from the sale of the Bonds have been or
will be used to finance the acquisition of the Leased Property and performance
of Landlord's construction work referenced in Section 25 and the repayment of
the Bonds will be secured by a mortgage of the Leased Property. The Bonds will
be issued and sold on the condition that interest due thereon will be excluded
from gross income for purposes of Federal income taxation under Section 103 of
the Internal Revenue Code of 1986, as amended (the "Code") and exempt from
Massachusetts income taxation.
26.2 Landlord and Tenant further acknowledge that Landlord's willingness
to enter into this Lease is specifically and expressly condition upon the
agreements of Tenant set forth in this Section 26, all of which are necessary to
the establishment and preservation of the aforesaid tax-exempt status. Tenant
acknowledges that qualification of the Bonds for tax-exempt status depends upon
the continuing qualification under the small issue exemption of Section 144(a)
of the Code, and that the Bonds will continue to be treated as a qualified small
issue only so long as (a) the sum of (i) the authorized amount of the Bonds plus
(ii) the aggregate face amount of certain other exempt small issues plus (iii)
the aggregate amount of certain capital expenditures does not exceed $10,000,000
and (b) with respect to (i) the Tenant, (ii) the Landlord, and (iii) each other
test-period beneficiary (as defined in Section 144(a)(10)(D) of the Code) of
the Leased Property, the sum of the authorized face amount of the Bonds
allocable to such test-period beneficiary plus the respective aggregate face
amount of all tax-exempt facility related bonds presently outstanding that are
allocable to such test-period beneficiary does not exceed $40,000,000. (Except
as expressly stated to the contrary, all quoted terms used in this Article 26
shall have the meanings set forth in Sections 103 and 141 through 150 of the
Code and in the regulations, rulings and judicial decisions thereunder.) Tenant
agrees that each of the following agreements, covenants, obligations and duties
of Tenant shall constitute a "Bond Related Obligation" such that the failure of
Tenant to perform or observe a Bond Related Obligation shall entitle Landlord to
the special remedies set forth in Section 26.4 hereof in addition to any other
remedies Landlord may have under this Lease:
(a) Tenant covenants and agrees that neither it nor any related
person" will make or incur any "capital expenditures" (which term for
purposes of this subsection (a) only, shall include both capital
expenditures and any exempt small issue industrial revenue bonds (other
than the Bonds) for purposes of Section 144(a) of the Code) within the
City of Taunton (or with respect to a contiguous or integrated facility
within a municipality adjacent to the City of Taunton) such that the
total of all such "capital expenditures" from and after the date of this
lease exceeds $10,000,000 if the effect thereof is to cause a loss in the
tax-exempt status of the Bonds.
(b) Tenant covenants and agrees that neither it nor any "related
person" will become a principal user" of any facility other than the
Leased Property located in the City of Taunton (or of a contiguous or
integrated facility within a municipality adjacent to the City of
Taunton) if the effect thereof is to cause a loss in the tax-exempt
status of the Bonds.
(c) Tenant covenants and agrees that neither it nor any "related
persons" will acquire the stock or assets of any person or entity in a
tax-free exchange or reorganization
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and will not allow its stock or assets to be acquired by any other person
or entity in a tax-free exchange or reorganization, or otherwise merge or
combine itself with any other person or entity in a tax-free transaction,
in each such case if any such person or entity shall be a "principal
user" of a facility located within the City of Taunton (or of a
contiguous or integrated facility within a municipality adjacent to the
City of Taunton) or shall be a test period beneficiary" of any
outstanding tax-exempt industrial development bonds, whenever issued, of
a facility, wherever located, if the effect thereof is to cause the loss
of the tax-exempt status of the Bonds.
(d) Tenant covenants and agrees that neither it nor any "related
person" will become a "test period beneficiary" of any outstanding
tax-exempt facility related bonds if the sum of the percentage of
outstanding principal amount of all tax-exempt facility related bonds,
whenever issued, allocable to Tenant and any "related persons", including
the Bonds, shall exceed $40,000,000.
(e) Any assignee, mortgagee, pledge or sublessee under Section 14
of this Lease will comply with the provisions of this Section 26 in
addition to all other provisions of this lease and such assignee,
mortgagee, pledge or sublessee must so agree in writing with Landlord.
(f) Tenant agrees that Landlord may withhold its consent under
Section 14 of this Lease, if, in addition to any other basis for
withholding such consent, any requested use of the demised premises will
not comply the requirements of the Code with respect to use of facilities
financed by the Bonds.
26.3 Tenant hereby represents that within the last six (6) years the
total amount of all "capital expenditures" plus all exempt small issue
industrial revenue bond financings with respect to any facility located in the
City of Taunton (or with respect to a contiguous or integrated facility within a
municipality adjacent to the City of Taunton) of which Tenant or any "related
person" is a "principal use?' does not exceed $1,000.00, excluding for purposes
of making such computation the "capital expenditures" made by Landlord in
connection with acquisition of the Leased Property and performance of Landlord's
construction work.
26.4 In the event of any failure to observe or perform any of the Bond
Related Obligations by Tenant, which failure has caused the loss of the
tax-exempt status of the Bonds, in addition to any other remedy which Landlord
may have under this Lease or otherwise, Landlord shall be entitled to recover
damages from Tenant in an amount equal to the interest payments, fees,
back-taxes, penalties and other amounts required to be paid by Landlord to the
holder of the Bonds from the date such loss shall occur until the Bonds are
redeemed or retired and that, upon such redemption or retirement, the Base Rent
shall be recalculated so as to provide the same debt coverage ratio for the
Leased Property with respect to the replacement mortgage financing that existed
before redemption or retirement of the Bonds The underwriting standards to be
applied in determining what adjustment to Base Rent is necessary to create the
same debt coverage ratio for the Leased Property shall be those underwriting
standards which were employed
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in determining the debt coverage ratio that existed with respect to the Leased
Property when the Bonds remained in effect Landlord shall give Tenant notice of
any claimed loss of tax-exempt status of the Bonds promptly after its receipt of
such claim, shall afford Tenant an opportunity to participate in any action
contesting such loss and shall permit Tenant to cure (if possible) any default
on its part giving rise to such loss It is understood and agreed that Tenant
shall not be deemed in default of this Lease nor shall Tenant be responsible for
any damages as set forth in this Paragraph 26E4 if the loss of tax-exempt status
of the Bonds is caused by Landlord
26.5 In the event that Landlord does not obtain Bond financing for the
acquisition of the Leased Property or the Landlord's construction work, as
contemplated by Section 261 of this Lease, within four (4) years from the date
of execution of this Lease, the provisions of this Section 26 shall be deemed
null and void of no further force and effect
IN WITNESS WHEREOF, the parties hereto have caused this Lease to be
executed and delivered as a sealed instrument by their respective duly
authorized officers as of the day and year first written above
LANDLORD: TENANT:
CONSTITUTION REALTY PHOENIX COLOR CORP
COMPANY, LLC)
By: /s/ Xxxxxx X. Xxxxx By: /s/ Xxxxxx Xxxxxxxxx
----------------------- ------------------------
Name: Xxxxxx X Xxxxx Name: Xxxxxx Xxxxxxxxx
Title: Manager Title: CFO
List of Exhibits
Exhibit A - Legal Description of Land
Exhibit LW - Landlord's Work
Exhibit FMRV - Calculation of Fair Market Rental Value
Exhibit EE - Existing Encumbrances
Exhibit NL - Notice of Lease
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