EXHIBIT 10.18
EXETER STREET THEATRE BUILDING
000 XXXXXXX XXXXXX
XXXXXX, XXXXXXXXXXXXX
OFFICE BUILDING LEASE
BY AND BETWEEN
EASTWEST PROPERTY FUND, L.P.,
A GEORGIA LIMITED PARTNERSHIP,
AS LANDLORD,
AND
XXXX XXXXX' IDEALAB!,
A CALIFORNIA CORPORATION
AS TENANT
TABLE OF CONTENTS
PAGE
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1. Premises 1
2. Term 2
3. Delivery of Possession of Premises 2
4. Rental 2
5. Security Deposit 7
6. Use of Premises 9
7. Compliance With Laws 10
8. Services to Tenant 10
9. Liability of Landlord 11
10. Improvements, Repairs by Landlord 12
11. Landlord's Right to Enter Premises 12
12. Repairs by Tenant 13
13. Alterations 13
14. Liens 14
15. Assignment and Subletting 14
16. Eminent Domain 17
17. Destruction or Damage to Premises 17
18. Indemnification 18
19. Insurance 18
20. Damage or Theft of Personal Property 20
21. Hazardous Materials 20
22. Landlord's Lien [TEXT INTENTIONALLY DELETED] 23
23. Relocation [TEXT INTENTIONALLY DELETED] 23
24. Subordination and Attornment 23
25. Estoppel Certificate 24
26. Default 24
27. Remedies 25
28. Effect of Termination of Lease 27
29. Attorneys' Fees 27
30. Quiet Enjoyment 27
31. Surrender of Premises 28
32. Holding Over 28
33. Removal of Fixtures 28
34. Notices 28
35. Agency Disclosure 29
36. Xxxxxxxxxxx xx Xxxxxxxx 00
00. Signage 30
38. Force Majeure 30
39. Authority 30
40. Definitions 30
41. Rules and Regulations 31
42. Guaranty [TEXT INTENTIONALLY DELETED] 31
43. Special Stipulations 31
44. Demolition [TEXT INTENTIONALLY DELETED] 31
45. Entire Agreement 31
Addendum of Special Stipulations
Exhibit A -- Floor Plan of Premises
i
Exhibit B -- Description of Property on Which the Project is
Situated
Exhibit C -- Plans and Specifications for Improvements to Premises
Exhibit D -- Hazardous Materials List
Exhibit E -- Rules and Regulations
Exhibit F -- Schedule of Lease Expiration Dates and Renewal Options
Exhibit G -- Cleaning Specifications
Exhibit H -- Letter of Credit
ii
OFFICE BUILDING LEASE
THIS LEASE, made this _______ day of ______________, 2000 (the "Effective
Date"), is entered into by and between EASTWEST PROPERTY FUND, L.P., a Georgia
limited partnership (the "Landlord"), and XXXX XXXXX' IDEALAB!, a California
corporation (the "Tenant").
FOR AND IN CONSIDERATION of the mutual covenants and conditions contained
herein, the parties hereto do hereby agree as follows:
1. PREMISES
Tenant hereby leases from Landlord approximately 22,052 rentable square
feet of space, as outlined by the floor plan attached hereto as Exhibit "A"
and incorporated herein by this reference, to be known as Suite 110,
comprised of 1,002 rentable square feet of space on the ground floor, 6,350
rentable square feet of space on the mezzanine level, approximately 7,350
rentable square feet of space on the second floor, and approximately 7,350
rentable square feet of space on the third floor (the "Premises") of the
Building known as the Exeter Street Theatre Building, located at 000
Xxxxxxx Xxxxxx, Xxxxxx, Xxxxxxxxxxxxx 00000 (the "Building"), which is
situated on certain real property more particularly described in Exhibit
"B" attached hereto and incorporated herein by this reference (the
"Property"; the Building and the Property are collectively referred to
herein as the "Project"). The actual rentable square footage of the
Premises shall be determined by Tenant's architect in accordance with BOMA
standards. In the event that the actual rentable square footage of the
Premises, as determined by Tenant's architect, varies from that set forth
in this Lease, then the parties agree to execute an amendment to this Lease
reflecting the actual rentable square footage of the Premises and modifying
all provisions of this Lease affected by such variation. All exhibits
attached to this Lease are incorporated herein by reference. This Lease
shall create the relationship of landlord and tenant between Landlord and
Tenant; no estate shall pass out of Landlord; Tenant has only a leasehold
interest in the Premises, not subject to levy and sale and not assignable
by Tenant except by Landlord's consent. In addition to the interest in the
Premises demised to Tenant under this Lease, Landlord hereby grants Tenant
a nonexclusive license for so long as this Lease is in full force and
effect to use the "Common Areas," as hereinafter defined, of the Project in
common with others entitled to use the Common Areas, including Landlord and
other tenants of the Project and their respective employees and invitees
and other persons authorized by Landlord, subject to the terms and
conditions of this Lease, including any and all rules and regulations
promulgated by Landlord in accordance with the terms of this Lease. As used
herein, the term "Common Areas" means all areas and facilities in the
Project that are provided and designated from time to time by Landlord for
the general nonexclusive use and convenience of Tenant, Landlord and all
other tenants of the Project and their respective employees, invitees,
licensees, or other visitors, and may include without limitation the
hallways, entryways, stairs, elevators, loading areas, and restroom
facilities of the Building, and the walkways of the Project. Landlord may
from time to time change the size, use, shape, configuration or nature of
any portion of the Common Areas, so long as such change does not deprive
Tenant of the substantial benefit and enjoyment of the Premises. Neither
Landlord nor Landlord's agents have made any representations, warranties or
promises with respect to the Project, the physical condition of the
Building, the land upon which it is erected, or the Premises, or any matter
or thing affecting or related to the Premises except as expressly set forth
in this Lease.
1
2. TERM
The term of this Lease (the "Term") shall commence on the Effective Date,
defined above (the "Commencement Date"), and shall expire on the last day
of the month in which the tenth (10th) anniversary of the "Rent
Commencement Date," defined below, occurs (the "Expiration Date"), except
as otherwise provided herein.
"Lease Year" shall mean each successive twelve-month period throughout the
Term provided that the first Lease Year shall commence on the Rent
Commencement Date and expire on the last day of the month in which the
anniversary of the Rent Commencement Date occurs, and each subsequent Lease
Year shall commence on the day following the expiration of the previous
Lease Year.
3. DELIVERY OF POSSESSION OF PREMISES
Landlord represents that the base building systems, including fire, life
safety, electrical, mechanical, and HVAC are in good working order as of
the Effective Date of this Lease. On or before the Commencement Date,
Landlord shall remove the existing bookcases from the Premises, but
Landlord shall otherwise deliver possession of the Premises to Tenant in
their present, "as is" condition as of the date of the execution of this
Lease, broom clean and free of debris and any items of personalty of
Landlord or any prior tenant, and Tenant hereby agrees to accept such
delivery of the Premises by Landlord. Commencing on the Effective Date,
Tenant shall have full access to the Premises to complete the Improvements,
as defined hereinbelow. Unless specifically set forth in this Lease,
Landlord shall have no obligation to make any improvements whatsoever to
the Premises. Tenant, by taking possession of the Premises shall be deemed
to have agreed that the Premises are then in the condition required by the
terms of this Lease, subject to latent defects.
4. RENTAL
(a) BASE RENTAL. Commencing the earlier of one hundred twenty (120) days
following the Commencement Date, or the date on which a certificate of
occupancy is received by Tenant reflecting the substantial completion of
the "Improvements," as defined in Exhibit "C" (the "Rent Commencement
Date"), Tenant shall pay base rental to Landlord as follows (the "Base
Rental"):
RATE PER
RENTAL PERIOD SQUARE FOOT MONTHLY ANNUALLY
------------- ----------- ------- --------
Lease Years 1-5 $36.00 $66,156.00 $793,872.00
Lease Years 6-10 $38.00 $69,831.33 $837,976.00
2
Each monthly installment shall be due and payable promptly on the first day
of each month, in advance and without offset, deduction or prior demand,
during the Term of this Lease. In the event that the Term of this Lease
shall commence on a date other than the first day of the month, rent for
such month shall be prorated and such prorated amount (which shall be equal
to the monthly Base Rental stated above multiplied by a fraction, the
numerator of which shall be the number of days from the Commencement Date
through the end of such month, inclusive of both days, and the denominator
of which shall be the number of days in such month) shall be due and
payable on the Commencement Date. All payments of rent or any other sum due
under this Lease shall be made payable to Landlord, and shall be forwarded
by Tenant to Landlord as follows: TMW Real Estate Management, Inc., Xxxxx
000, Xxx Xxxxxxx Xxxxx, Xxxxxxx, Xxxxxxx 00000.
In the event Tenant shall fail to pay a monthly installment within five (5)
days of the due date, a late charge of five percent (5%) of the monthly
Base Rental, with a minimum of twenty dollars ($20.00) per month, shall be
added to the Base Rental and paid to Landlord for each such late payment
and the same shall be treated as additional rent. Should Tenant present a
check to Landlord that is returned from Tenant's bank for any reason,
Tenant shall pay to Landlord as additional rent all costs incurred by
Landlord as a result of such return, and Landlord reserves the right to
demand that all future rental payments be made in the form of cashiers'
checks or certified funds. Tenant agrees to pay Landlord interest at a rate
of twelve percent (12%) per annum (or the maximum rate permitted by
applicable law, whichever is less) on all Base Rental, additional rental or
other sums due hereunder that are not paid when such amounts are due and
payable. Nothing contained herein shall require Landlord to accept any
tender of payment from Tenant for less than the full amount then due under
this Lease, including any and all late charges, interest and attorneys'
fees that may then be due from Tenant in accordance with the express terms
of this Lease. Landlord may elect to accept less than the full amount then
due from Tenant hereunder; however, no payment by Tenant or receipt by
Landlord of such lesser amount shall be deemed to be other than payment on
account, and no restrictive endorsement or statement on any check or
payment shall be deemed to alter the express provisions of this Lease, nor
constitute an accord and satisfaction. Landlord may accept less than the
full amount then due from Tenant without prejudice to Landlord's right to
recover the balance of the full amount then due, or to pursue any other
remedies then available to Landlord under this Lease or applicable law. In
all events, including but not limited to Landlord's acceptance of a partial
payment from Tenant, any payment accepted by Landlord from Tenant may be
applied first to retire the oldest receivables due from Tenant hereunder,
then to any current rental or other payment then due hereunder, and the
balance, if any, will be applied to any rental or other payment which will
become due from Tenant hereunder.
(b) ADDITIONAL RENTAL - OPERATING EXPENSES AND REAL ESTATE TAXES.
(1) DEFINITIONS. The following definitions shall apply for purposes
of this Section:
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All sums other than Base Rental due from Tenant to Landlord under
this Lease shall constitute "Additional Rental." The term "Operating
Expenses" as used herein shall include all direct costs of
administration, operation and maintenance of the Building, and the
Common Areas, as determined in accordance with generally accepted
accounting principles, and shall include Landlord's costs and
expenses incurred in connection with the following by way of
illustration but not limitation: the cost of labor, materials and
services for the operation and maintenance of the Building, and the
Common Areas, including but not limited to license, permit and
inspection fees; water and sewer charges; garbage and waste disposal;
gas, fuel, electricity and other utilities; heat, air conditioning
and ventilation repairs; elevator service; plumbing service and other
normal repairs; janitorial and cleaning service; window washing
services, snow and ice removal; landscaping; repairs, maintenance and
replacement of curbs, walkways and all other paved areas; association
fees; pest control; maintenance contracts; security services or
personnel; insurance for fire, extended coverage, general liability,
and other insurance which Landlord is required to maintain on the
Building and its appurtenances either by the terms of this Lease or
by the holder of any mortgage or deed to secure debt encumbering the
Building, or which Landlord reasonably deems to be necessary in
connection with the ownership and operation of the Building;
personnel engaged in onsite management, administration, operation and
maintenance of the Building, its Common Areas and its appurtenances
together with payroll taxes, employee benefits, workers' compensation
insurance premiums and the cost of uniforms associated therewith;
rental expenses for onsite management offices, management fees;
supplies, materials, tools, equipment and general costs associated
therewith, all accrued and based on a calendar year type operation;
but excluding tenant alterations, depreciation on the Building and
equipment, costs of a capital nature not expressly permitted to be
included hereunder, interest, executive salaries, payments made to
any affiliate of Landlord for goods or services that exceed the fair
market value of such goods or services that would be charged by an
unrelated party in an arm's length transaction, Landlord's costs
incurred in maintaining and repairing the structural portions and the
roof of the Building, all costs billed directly to tenants of the
Building either by Landlord or a third party, and all expenses
incurred by Landlord in cleaning, maintaining and repairing the
Common Area entrance and facilities associated with the Newbury
Street entrance to the Building.
If, for any reason, including imposition of governmental
requirements, laws or regulations, Landlord shall make an
expenditure, directly or indirectly, which is intended to reduce the
energy consumption of the Building and which, by generally accepted
accounting principles would be treated as a capital expenditure, the
annual Operating Expenses of the Building shall also include the
amortization of such capital expenditure based upon a useful life
acceptable to the appropriate taxing authority; provided, however,
that the amount of such capital expenditure included in any calendar
year for purposes of calculating Tenant's Additional Rental hereunder
shall not exceed the savings achieved in such year as a result of
such expenditure.
In the event that any local, state or federal government shall, by
any legally enforceable legislative, administrative or judicial
action, whether by ordinance, act, statute, order, mandate, rule,
regulation or otherwise, require during the Term of this Lease any
alteration of or improvement to any portion of the Project or
Building, excluding the Premises or any premises leased or available
to be leased by other tenants of the Building (a "Mandated
Alteration"), which, by generally accepted accounting principles
would be treated as a capital expenditure, then, provided that such
Mandated Alteration is the result of the adoption of a new or changed
ordinance, act, statute, order, mandate, rule or regulation or
interpretation thereof not existing on the Commencement Date of this
Lease, the annual Operating Expenses of the Building shall also
include the annual amortization of such capital expenditure based
upon a useful life of not less than five (5) years.
"Tenant's Proportionate Share" shall be calculated by dividing the
rentable square footage of the Premises by the total rentable square
footage of the Building. The rentable square footage of the Building
is 45,502 rentable square feet; accordingly, Tenant's Proportionate
Share is 48.4638%.
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The term "Taxes" shall include every type of tax, charge or other
amount assessed against the Building or upon the real estate upon
which the Building is located, including any sales tax assessed on
the rent collected by Landlord in connection with leasing space in
the Building, together with any expenses for tax consulting services
and legal services in appealing or protesting such taxes. Landlord
agrees to make commercially reasonable efforts to determine whether
the amount of Taxes assessed each year is appropriate, and to
determine whether an appeal or protest of the amount of such Taxes
should be pursued. Taxes shall not include income taxes, inheritance,
estate, gift, excise, franchise, gross receipts, stamp or profit
taxes imposed upon Landlord, any tax upon the sale, transfer and/or
assignment of Landlord's interest in the Project other than a sales
tax on rent, as referenced above, and any interest or penalties
resulting from the late payment of Taxes by Landlord.
(2)REIMBURSEMENT OF OPERATING EXPENSES AND TAXES. Commencing on the
Rent Commencement Date, Tenant shall pay as Additional Rental
Tenant's Proportionate Share of Operating Expenses and Taxes for each
calendar year or part thereof during the Lease Term, as the same may
be extended by the parties from time to time (referred to herein as
an "Expense Year") as and when specified below. An annual
determination of Operating Expenses and Taxes shall be made by
Landlord pursuant to generally accepted accounting principles and
shall be binding upon Landlord and Tenant.
(3)ESTIMATES OF OPERATING EXPENSES AND TAXES. Prior to the actual
determination of the Operating Expenses and Taxes for any Expense
Year, Landlord may, if it so elects and at any time or from time to
time during such Expense Year, estimate in good faith the amount of
such Operating Expenses and Taxes that will be paid or incurred in
such year, based upon the amount of Operating Expenses and Taxes that
were incurred in the previous year. Landlord may give Tenant written
notice of the amount of such estimated Operating Expenses and Taxes
and the amount that will be due each month from Tenant. In such
event, Tenant shall, subsequent to receipt of such written notice,
pay monthly Tenant's Proportionate Share of such estimated amount at
the same time and in the same manner as Base Rental is due from
Tenant hereunder.
(4)ANNUAL RECONCILIATION. If, in any Expense Year, the total amount
Tenant actually paid for estimated Operating Expenses and Taxes for
such year is less than Tenant's Proportionate Share of the actual
amount of the Operating Expenses and Taxes owed by Tenant for such
year, Tenant shall pay to Landlord as Additional Rental in one lump
sum the difference between the total amount actually paid by Tenant
for such year and the amount Tenant should have paid pursuant to
subparagraph 2 above; this lump sum payment shall be made within
thirty (30) days of receipt of Landlord's statement therefor; or if
the total amount Tenant actually paid for estimated Operating
Expenses and Taxes is more than Tenant's Proportionate Share of the
actual amount of such Operating Expenses and Taxes, then Landlord
shall remit the excess to Tenant within thirty (30) days of the
making of such determination or, at Landlord's election, credit such
amount against the next monthly installment of Base Rental.
5
(5)PRORATIONS. If the Rent Commencement Date is other than January 1 or
if the Expiration Date is other than December 31, Tenant's
Proportionate Share of Operating Expenses and Taxes for such year
shall be prorated, with the proration for the months in which the
Rent Commencement Date and the Expiration Date occurs to be based
upon a 30-day month. Even if the Term has expired, and Tenant has
vacated the Premises when the final determination is made of Tenant's
Proportionate Share of Operating Expenses and Taxes for the year in
which this Lease expires, Tenant shall pay any increase due over the
estimated amount paid and conversely any overpayment made shall be
rebated by Landlord to Tenant, all as specified above.
(6)AUDIT. Tenant shall have the right to have Landlord's books and
records pertaining to Operating Expenses for any Expense Year
reviewed, copied and audited ("Tenant's Audit") provided that (i)
such right shall not be exercised more than once during any calendar
year; (ii) if Tenant elects to conduct Tenant's Audit, Tenant shall
provide Landlord with written notice thereof no later than thirty
(30) days following Tenant's receipt of Landlord's statement of
Operating Expenses for the year to which Tenant's Audit will apply;
(iii) Tenant shall have no right to conduct Tenant's Audit if Tenant
is, either at the time Tenant forwards Landlord written notice that
Tenant's Audit will be conducted or at any time during Tenant's
Audit, then in default under this Lease; (iv) conducting Tenant's
Audit shall not relieve Tenant from the obligation to pay Tenant's
Proportionate Share of Operating Expenses, as billed by Landlord,
pending the outcome of such audit; (v) Tenant's right to conduct such
audit for any calendar year shall expire thirty (30) days following
Tenant's receipt of Landlord's statement of Operating Expenses for
such year, and if Landlord has not received written notice of such
audit within such thirty (30) day period, Tenant shall have waived
its right to conduct Tenant's Audit for such calendar year; (vi)
Tenant's Audit shall be conducted by a Certified Public Accountant
not employed by or otherwise affiliated with Tenant, except to the
extent that such accountant has been engaged by Tenant to conduct
Tenant's Audit; (vii) Tenant's Audit shall be conducted at Landlord's
office where the records of the year in question are maintained by
Landlord, during Landlord's normal business hours; and (viii) except
as set forth below, Tenant's Audit shall be conducted at Tenant's
sole cost and expense. In the event that Tenant's Audit demonstrates
to Landlord's reasonable satisfaction that Landlord has overstated
the Operating Expenses for the year audited, then Tenant's
Proportionate Share of the overstated amount shall be credited
against Tenant's Base Rental and Additional Rental next due under
this Lease until such credit has been exhausted, or if the Lease Term
has expired and no further amounts are due from Tenant under this
Lease, Landlord shall refund such overstated amount to Tenant within
thirty (30) days following Landlord's receipt of documentation
reasonably acceptable to Landlord reflecting the calculation of such
overstated amount. Additionally, in the event that Tenant's Audit
demonstrates to Landlord's reasonable satisfaction that Landlord has
overstated the Operating Expenses for the year audited by more than
five percent (5%), then, in addition to reimbursing Tenant for
Tenant's Proportionate Share of such overstated amount, as set forth
above, Landlord shall also reimburse Tenant for Tenant's actual
reasonable cost incurred in conducting Tenant's Audit within thirty
(30) days of Landlord's receipt of documentation reasonably
acceptable to Landlord reflecting the amount of such cost.
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5. SECURITY DEPOSIT
(a) DESCRIPTION OF LETTER OF CREDIT. As security for the full and faithful
performance of all the terms, conditions and obligations of Tenant under
this Lease (collectively, the "Obligations"), Tenant shall maintain in full
force and effect throughout the Term of this Lease, an irrevocable, standby
letter of credit in favor of Landlord or its successors or assigns, issued
by a banking institution reasonably acceptable to Landlord (the "Issuer"),
in the amounts set forth in this section (the "Letter of Credit"). The
Letter of Credit shall be in a form substantially similar to the form
Letter of Credit attached hereto as Exhibit "H," or in such other form as
may be reasonably acceptable to Landlord. Contemporaneously with Tenant's
execution and delivery of this Lease to Landlord for execution, Tenant
shall deliver the executed Letter of Credit to Landlord, and upon Tenant's
delivery of the executed Letter of Credit to Landlord, and Landlord's
acceptance of same, a true and genuine photocopy of the executed Letter of
Credit shall be attached hereto as Exhibit "H-1" and incorporated herein by
this reference.
(b) INITIAL AMOUNT OF LETTER OF CREDIT. The initial amount of the Letter of
Credit shall be Eight Hundred Ninety-five Thousand, One Hundred Ninety-two
Dollars ($895,192.00), which amount represents the "Allowance," as defined
in Exhibit "C" to this Lease, and the leasing commissions to be paid by
Landlord in connection with this transaction.
(c) REDUCTIONS IN AMOUNT OF LETTER OF CREDIT. At the commencement of the second
(2nd), third (3rd), fourth (4th), fifth (5th) and sixth (6th) Lease Years
the amount of the Letter of Credit may be reduced by the amount of One
Hundred Thirty-seven Thousand, Thirty-eight and 40/100 Dollars
($137,038.40); thereafter, the Letter of Credit shall be maintained by
Tenant in such reduced amount (which will then be Two Hundred Ten Thousand
Dollars ($210,000.00), assuming that all scheduled reductions are made)
throughout the balance of the Term of the Lease, as the same may be
extended by the parties from time to time. Provided, however, that a
scheduled reduction in the Letter of Credit shall not occur if (i) at the
time of such scheduled reduction Tenant is in default of its Obligations
under this Lease, beyond any notice and period of cure applicable under
this Lease, and (ii) Issuer receives written notice of such uncured default
from Landlord not less than thirty (30) days prior to the date on which
such reduction is scheduled to occur.
(d) DRAWING UPON THE LETTER OF CREDIT IN EVENT OF DEFAULT. In the event that
Tenant shall default in any of its Obligations under this Lease, and fail
to cure such default within the time permitted under this Lease, then in
addition to any other remedies provided under this Lease, Landlord shall be
entitled to a draw upon the Letter of Credit, in the manner described in
the Letter of Credit, in such amount as may be necessary in order to cure
such default on behalf of Tenant. In the event that Landlord draws upon the
Letter of Credit, Tenant shall, within ten (10) days of receipt of notice
from Landlord that the Letter of Credit has been drawn down, restore the
Letter of Credit to the full amount of the Letter of Credit then required
to be maintained by Tenant hereunder, and provide Landlord with
documentation reasonably acceptable to Landlord that the Letter of Credit
has been so restored. If Tenant (i) allows the Letter of Credit to lapse at
any time during the Term of this Lease, or (ii) fails to restore the Letter
of Credit to the amount required hereunder after the Letter of Credit has
been drawn upon by Landlord in accordance with the terms hereof, then
Tenant shall be in default under the Lease and Landlord shall be entitled
to exercise all remedies for default set forth in this Lease.
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(e) DRAWING UPON THE LETTER OF CREDIT WHERE LETTER OF CREDIT IS NOT RENEWED.
The parties acknowledge that the Letter of Credit will be issued for an
initial period of one (1) year, which shall be automatically renewed by
Issuer for successive periods of one (1) year throughout the Term of this
Lease, unless Issuer provides Landlord with written notice of its election
not to renew the Letter of Credit upon the expiration of its then current
term. The parties agree that in such event, Landlord may immediately draw
upon the Letter of Credit in accordance with its terms which expressly
provide for such draw to be permitted, even if no default by Tenant has
occurred under this Lease. In such event, the funds drawn by Landlord upon
the Letter of Credit shall be held by Landlord as a security deposit, in
accordance with the terms of subparagraph (f) below.
(f) SECURITY DEPOSIT. Landlord shall place any funds received by drawing upon
the Letter of Credit under subparagraph (e) above (the "Security Deposit")
in an interest bearing account, and the interest accruing on the Security
Deposit shall be held, disbursed, returned and/or retained in the same
manner as the principal amount of the Security Deposit. If funds are
received by Landlord under subparagraph (e) above prior to the commencement
of the sixth (6th) Lease Year, then the principal amount of the Security
Deposit shall be reduced in the same manner and upon the same schedule as
reductions in the amount of the Letter of Credit are permitted under
subparagraph (c) above, provided that at the time of the permitted
reductions Tenant is not then in default of its Obligations under this
Lease beyond any notice and period of cure; at the time of any reductions
in the principal amount of the Security Deposit, the amount by which the
Security Deposit is to be reduced shall be refunded to Tenant, together
with all interest then accrued on the Security Deposit. The balance of the
Security Deposit existing as of the commencement of the sixth (6th) Lease
Year (which will be Two Hundred Ten Thousand Dollars ($210,00.00) if all
scheduled reductions are made), and all interest thereafter accruing, shall
be held by Landlord throughout the balance of the Lease Term. The balance
of the Security Deposit is refundable to Tenant within thirty (30) days
following the Expiration Date, as the same may be extended by the parties
from time to time, provided that no defective conditions are left
unrepaired by Tenant, other than normal wear and tear, loss by fire or
other casualty not caused by Tenant, Tenant's employees, agents or
contractors or condemnation, and provided Tenant is not otherwise in
default under this Lease. Landlord may, but shall not be required to, apply
all or a portion of the Security Deposit toward sums due to Landlord by
Tenant hereunder and/or in order to make any repairs to the Premises
required to be made by Tenant hereunder, and any portion of this Security
Deposit used by Landlord for such purposes shall be restored by Tenant
within fifteen (15) days after written demand therefor from Landlord. Any
portion of the Security Deposit not required to reimburse Landlord for
Landlord's expense in repairing defective conditions caused by Tenant or
for paying amounts owed by Tenant to Landlord, shall be refunded to the
Tenant as provided above.
(g) ASSIGNMENT OF THE LEASE BY LANDLORD. In the event that Landlord assigns
this Lease pursuant to a sale of the Property or otherwise, then Tenant
shall present Landlord with such documentation as may be required by Issuer
to transfer Landlord's interest as beneficiary of the Letter of Credit to
Landlord's assignee, and all costs of processing such transfer shall be
paid by Tenant directly to Issuer.
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6. USE OF PREMISES
Tenant shall use the Premises only for general business or professional
office purposes, and shall not use the Premises for any illegal purpose, or
violate any statute, regulation, rule, or order of any governmental body,
or create or allow to exist any nuisance, or trespass, or do any act in or
about the Premises, or bring anything onto or in the Premises or the
Building which will in any way increase the rate of insurance on the
Premises or said Building, deface or injure the Premises or such Building,
or overload the floor of the Premises. Cigar smoking is prohibited in all
areas of the Building, including the Premises. Tenant shall not permit
smoke from cigarettes or any other type of smoking instrument used by
Tenant or Tenant's employees, agents, invitees, or licensees to filter into
the Common Areas of the Building, or into other tenants' premises, or to
create in any manner a nuisance which interferes with other tenants' rights
of quiet enjoyment of their premises in the Building (collectively the
"Smoking Nuisance"). Additionally, Tenant shall inform all of its employees
(and all other agents and contractors who regularly occupy the Premises)
that smoking is prohibited in all Common Areas of the Building, and of the
foregoing restrictions set forth in this paragraph. If a Smoking Nuisance
is generated in the Premises, Landlord shall notify Tenant, and Tenant
shall have twenty (20) days from the date of receipt of Landlord's notice
to eliminate the Smoking Nuisance in a manner approved by Landlord. If
Tenant fails to eliminate the Smoking Nuisance to Landlord's satisfaction,
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Landlord, at Tenant's expense, may install all reasonable filtering devices
necessary to eliminate the Smoking Nuisance.
7. COMPLIANCE WITH LAWS
(a) LANDLORD'S COMPLIANCE. During the Term of this Lease, Landlord shall be
responsible for making any modifications to the Project and Building or its
appurtenances, excluding the Premises, but including the Common Areas,
elevators and entrances serving the Project and Building, required pursuant
to any applicable federal, state and local laws, ordinances, building
codes, and rules and regulations of governmental entities having
jurisdiction over the Project, including but not limited to the Americans
with Disabilities Act (the "ADA") and all regulations and orders
promulgated pursuant to the ADA (collectively, the "Applicable Laws"). Any
modifications to the Project and/or the Building made by Landlord pursuant
to the provisions of this paragraph shall initially be at Landlord's
expense; however, such expense may be included in Landlord's Operating
Expenses of the Building as set forth in Paragraph 4(b)(1) of this Lease.
(b) TENANT'S COMPLIANCE. Tenant shall comply with all governmental laws,
ordinances, and regulations applicable to the use of the Premises, and
shall promptly comply with all governmental orders and directives for the
correction, prevention, and abatement of nuisances in, upon, or connected
with the Premises, all at Tenant's sole expense. Tenant warrants that all
improvements or alterations of the Premises made by Tenant or Tenant's
employees, agents or contractors, either prior to Tenant's occupancy of the
Premises or at any time during the term of this Lease, will comply with all
Applicable Laws. In addition, Tenant warrants that its use of the Premises
will be in strict compliance with all Applicable Laws. During the Term of
this Lease, Tenant shall, at Tenant's sole cost and expense, be responsible
for making any modifications to the Premises that may be required pursuant
to any Applicable Laws.
(c) MUTUAL INDEMNITY. Landlord agrees to indemnify, defend and hold Tenant
harmless from and against any claims, losses or causes of action arising
out of Landlord's failure to comply with the provision of subparagraph (a)
above. Tenant shall indemnify, defend and hold Landlord harmless from and
against any claims, losses or causes of action arising out of Tenant's
failure to comply with the provisions of subparagraph (b) above. The
indemnities set forth in this paragraph shall survive the expiration or
earlier termination of this Lease.
8. SERVICES TO TENANT
Landlord shall provide, subject to limitations contained in any
governmental controls now or hereafter imposed, or matters beyond
Landlord's control, the following services:
(a) Furnish heated and chilled water or other heating/cooling medium to the
Premises for a heat pump system installed or to be installed to maintain
the Premises at comfortable temperatures.
(b) General cleaning and janitorial service five times per week, in accordance
with the Cleaning Specifications attached hereto as Exhibit "G."
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(c) Reasonable quantities of water to lavatories and toilets in or
appurtenant to the Premises.
(d) The Premises are equipped with a separate meter to monitor the amount of
electricity used to operate the lights and any equipment, machinery or
other items connected to the power outlets in the Premises, as well as the
heating, ventilation and air conditioning system serving the Premises. The
cost of all electricity furnished to the Premises will be billed to Tenant
by Landlord on a monthly basis. Tenant shall promptly pay all bills for
such service, and Tenant's failure to do so shall constitute an additional
event of default under this Lease. Tenant will not use any electrical
equipment which in Landlord's opinion will overload the wiring
installations or interfere with the reasonable use thereof by other users
in the Building. Tenant will not, without Landlord's prior written consent
in each instance, connect any items such as non-building standard tenant
lighting, vending equipment, printing or duplicating machines, computers
(other than desktop word processors, personal computers and photocopy
equipment not requiring dedicated or special circuitry) or auxiliary air
conditioners to the electrical system of the Premises, or make any
alteration or addition to the electrical system in the Premises or
Building. If any additional circuitry or wiring is required by Tenant, and
Landlord approves the installation of the same in writing, such work shall
be performed at Tenant's expense by Landlord's electrician or under
Landlord's control and supervision, and Tenant shall pay Landlord for such
additional work as billed.
(e) Passenger elevator service to the Premises, 24 hours per day, 7 days per
week, subject to the terms of this Lease, including the Rules and
Regulations attached hereto as Exhibit "E." The 000 Xxxxxxx Xxxxxx elevator
will be the main access passenger elevator for Tenant.
(f) Loading dock access to the Building and freight elevator access to the
Premises in accordance with the Rules and Regulations for the Building and
Landlord's policies and procedures as established from time to time for the
loading and unloading of freight and for the use of the freight elevator.
(g) Tenant shall have access to the Premises 24 hours per day, 7 days per week,
subject to the terms of this Lease.
9. LIABILITY OF LANDLORD
Excepting for the willful misconduct or gross negligence of Landlord, its
agents, contractors and employees, Landlord shall not be liable to Tenant
in any manner whatsoever for failure or delay in furnishing any service
provided for in this Lease, and no such failure or delay to furnish any
service or services by Landlord shall be an actual or constructive eviction
of Tenant nor shall any such event operate to relieve Tenant from the
prompt and punctual performance of each and all of the covenants to be
performed herein by Tenant; nor shall Landlord be liable to Tenant for
damage to person or property caused by defects in the cooling, heating,
electric, water, elevator or other apparatus or systems or by water
discharged from sprinkler systems, if any, in the Building; nor shall
Landlord be liable to Tenant for the theft, or loss of any property of
Tenant whether from the Premises or any part of the Building or property
adjoining the Building containing the Premises. Landlord agrees to make
reasonable efforts to protect Tenant from interference or disturbance of
third persons including other tenants, however, Landlord shall not be
liable for any such interference or disturbance whether caused by another
tenant or tenants or Landlord or other person, nor shall Tenant be relieved
from any obligation under this Lease because of such interference,
disturbance or breach; provided, however, that if Landlord shall fail to
provide any service to Tenant that Landlord is required to provide to
Tenant hereunder, and such failure shall persist for a period of ten (10)
days after Landlord's receipt of written notice from Tenant of the
existence of such failure, and such failure is not due to a force majeure
event, and as a result of such failure, the Premises or a portion thereof
shall be substantially unusable by Tenant for the purposes for which they
were demised to Tenant under this Lease, then, commencing with the
expiration of such ten (10) day period, Tenant's Base Rental and Additional
Rental due under this Lease shall xxxxx in the proportion that the rentable
square footage of the portion of the Premises rendered substantially
unusable by such failure bears to the total rentable square footage of the
Premises for the period of time that such portion is substantially
unusable.
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10. IMPROVEMENTS, REPAIRS BY LANDLORD
Except as may be specifically set forth in this Lease and any Special
Stipulations attached hereto, Landlord shall have no obligation to alter,
remodel, improve, repair, decorate or paint the Premises. Landlord shall,
however, repair and maintain all Common Areas of the Project and the
structural portions of the Building, including elevators of the Building,
and the basic plumbing, air conditioning, heating and electrical systems
serving the Premises and Common Areas installed in accordance with similar
buildings in Boston, Massachusetts, but taking into consideration the age
of the Building, unless the condition requiring such maintenance is caused
in part or in whole by the act, neglect, fault or omission of any duty by
Tenant, its agents, servants, employees or invitees, in which case Tenant
shall pay Landlord the reasonable cost of such maintenance or repairs.
Landlord's costs incurred in maintaining and repairing the structural
portions and the roof of the Building shall not be included in Operating
Expenses. By taking possession of the Premises, Tenant accepts them as
being in good order, condition and repair, and in the condition which
Landlord is obligated to deliver them to Tenant, except for latent defects
and such items as Tenant may set forth on a punch list to be provided from
Tenant to Landlord in accordance with the Notices provision of this Lease
within ten (10) days after Landlord's delivery of possession of the
Premises to Tenant. Landlord shall not be liable for any failure to make
any repairs or to perform any maintenance required of Landlord hereunder,
unless such failure shall persist for an unreasonable period of time after
written notice of the need for such repairs or maintenance is given to
Landlord by Tenant in accordance with the Notices provision of this Lease;
provided, however, that if such failure shall persist for a period of ten
(10) days after Landlord's receipt of written notice from Tenant of the
need for such repairs or maintenance, and such failure is not due to a
force majeure event, and as a result of such failure, the Premises or a
portion thereof shall be substantially unusable by Tenant for the purposes
for which they were demised to Tenant under this Lease, then, commencing
with the expiration of such ten (10) day period, Tenant's Base Rental and
Additional Rental due under this Lease shall xxxxx in the proportion that
the rentable square footage of the portion of the Premises rendered
substantially unusable by such failure bears to the total rentable square
footage of the Premises for the period of time that such portion is
substantially unusable.
11. LANDLORD'S RIGHT TO ENTER PREMISES
Landlord shall retain duplicate keys to all doors of the Premises. Tenant
shall not change the locks on any entrance to the Premises. Upon Tenant's
written request to Landlord, Landlord will make a reasonable change of
locks on behalf of Tenant at Tenant's sole cost and expense. Landlord and
its agents, employees and independent contractors shall have the right to
enter the Premises at all times in the event of an emergency, and at
reasonable hours to make repairs, additions, alterations, and improvements
that are required by this Lease or are otherwise performed with Tenant's
prior written consent; to exhibit the Premises to prospective purchasers,
lenders or tenants, but Landlord may enter to exhibit the Premises to
prospective tenants only during the last twelve (12) months of the Term or
following any event of default for as long as such event of default remains
uncured; and to inspect the Premises to ascertain that Tenant is complying
with all of its covenants and obligations hereunder. Landlord shall also
have the right to enter the Premises at reasonable hours to install,
maintain, repair and replace pipes, wires, cables, duct work, conduit and
utility lines through hung ceiling space and column space within the
Premises. Landlord agrees to use reasonable efforts to minimize any
interference with Tenant's business caused by such entry. Landlord shall,
except in case of emergency, afford Tenant such prior notification of an
entry into the Premises as shall be reasonably practicable under the
circumstances; such prior notification may take the form of a telephone
call to Tenant at the Premises or written notice forwarded to Tenant at
Tenant's address for notices set forth in this Lease. During such time as
such work is being carried on in or about the Premises, payments provided
herein shall not xxxxx and Tenant waives any claim or cause of action
against Landlord for damages by reason of interruption of Tenant's business
or loss of profits therefrom because of the prosecution of any such work or
any part thereof.
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12. REPAIRS BY TENANT
With the exception of those items set forth in this Lease that are required
to be repaired by Landlord, Tenant, during the Term of this Lease or any
extension or renewal of this Lease, shall, at its sole cost and expense,
make all repairs as shall be reasonably necessary to keep the Premises, and
any portion of the Building under Tenant's exclusive control, in good
condition and repair, normal wear, loss by fire or other casualty not
caused by Tenant, Tenant's employees, agents or contractors and
condemnation excepted. Tenant further agrees that all damage or injury of
whatever nature done to the Premises by the Tenant or by any person in or
upon the Premises except the Landlord, Landlord's agents, servants,
contractors and employees, shall be repaired by Tenant at its sole cost and
expense.
13. ALTERATIONS
Tenant shall make no alterations or other improvements (collectively,
"Alterations") to the Premises without Landlord's prior written consent,
which shall not be unreasonably withheld or delayed; provided, however,
that Tenant may make decorative changes to the interior of the Premises,
including but not limited to repainting and recarpeting the Premises,
without Landlord's consent. Unless otherwise agreed, all such approved
Alterations shall be made by Landlord at Tenant's sole expense and shall
become the property of Landlord and be surrendered with the Premises upon
the expiration of this Lease.
Landlord may, at Landlord's option, require Tenant to remove any or all
such Alterations, and repair any damage to the Premises resulting from such
Alterations, upon the expiration or earlier termination of this Lease,
provided that Landlord informs Tenant at the time of providing its written
consent to the making of any such Alteration that Tenant will be required
to remove such Alteration, and repair of any damage to the Premises
resulting from such Alteration or the removal of such Alteration, prior to
the expiration or earlier termination of this Lease.
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14. LIENS
Tenant shall pay or cause to be paid all costs for work done by or on
behalf of Tenant or caused to be done by or on behalf of Tenant on the
Premises of a character which will or may result in liens against
Landlord's interest in the Premises, the Building or the Project, or any
part thereof and Tenant will keep the same free and clear of all
mechanics' liens and other liens on account of work done for or on behalf
of Tenant or persons claiming under Tenant. Tenant hereby agrees to
indemnify Landlord for, and defend and hold Landlord harmless from and
against all liability, loss, damages, costs or expenses, including
reasonable attorneys' fees, incurred in connection with any claims of any
nature whatsoever for work performed for, or materials or supplies
furnished to, Tenant, including lien claims of contractors, laborers, or
materialmen. Should any such liens be filed or recorded against the
Premises, the Building or the Project with respect to work done for or
materials supplied to or on behalf of Tenant or should any action
affecting the title thereto be commenced, Tenant shall cause such liens to
be released of record within twenty (20) days after notice thereof. If
Tenant desires to contest any such claim of lien, Tenant shall nonetheless
cause such lien to be released of record by the posting of adequate
security with a court of competent jurisdiction as may be provided by
Massachusetts' mechanics' lien statutes. If Tenant shall be delinquent in
paying any charge for which such a mechanics' lien or suit to foreclose
such a lien has been recorded or filed and shall not have caused the lien
to be released as aforesaid, Landlord may (but without being required to
do so) pay such lien or claim and costs associated therewith, and the
amount so paid, together with interest thereon at the highest rate
permitted by law and reasonable attorneys' fees incurred in connection
therewith, shall be immediately due from Tenant to Landlord as Additional
Rental.
15. ASSIGNMENT AND SUBLETTING
Tenant may not, without at least fifteen (15) days' prior written notice
to Landlord in accordance with the Notices provision of this Lease, and
the prior written consent of Landlord in each instance, which consent
shall not be unreasonably withheld or delayed, assign this Lease or any
interest hereunder, or sublet the Premises or any part thereof, or permit
the use or occupancy of the Premises by any party other than Tenant
(collectively, an "Assignment"). In the event that Tenant provides
Landlord with notice of such proposed Assignment, such notice shall be
accompanied by a copy of any and all documents, instruments and agreements
pertaining to such transaction reasonably necessary for Landlord to
evaluate such proposed Assignment. Whether or not such proposed Assignment
is approved by Landlord, Tenant shall reimburse Landlord for its
reasonable attorneys' fees incurred in connection with reviewing any
proposed Assignment. Landlord shall have fifteen (15) days from its
receipt of Tenant's notice of the proposed Assignment and all other
required and reasonably requested information within which to make a
decision as to whether or not such proposed Assignment will be approved.
At a minimum, without limitation, in each event the following requirements
must be satisfied: (a) Tenant shall not be released from any obligations
or any liabilities hereunder as a result of any such Assignment; (b)
14
Tenant shall not be in default hereunder at the time it requests
Landlord's consent or on the effective date of the proposed Assignment;
(c) any Assignment or attempted Assignment without Landlord's consent
shall be voidable at Landlord's option; (d) Landlord shall be provided
with such information regarding the name, identity, business reputation
and creditworthiness of the proposed assignee or subtenant as Landlord
shall reasonably request; and (e) in the case of an assignment of the
Lease, the assignee shall deliver to Landlord a written agreement whereby
it assumes jointly and severally with Tenant all of the obligations and
liabilities of Tenant under this Lease. In the event Landlord elects to
approve a requested Assignment, Landlord has the right, but not the
obligation, to terminate the Lease effective as of the date Tenant vacates
the Premises; provided, however, that Landlord shall have no right to
terminate the Lease under this paragraph in the event that the Assignment
is a "Permitted Assignment," as defined below. Should Landlord elect to
terminate the Lease, Tenant shall be relieved of any liability or
obligation to pay rent beyond the date of termination. Unless Landlord
expressly agrees to terminate the Lease or Tenant's obligations hereunder,
in no event shall any Assignment, whether approved by Landlord or not,
relieve Tenant from its obligations under this Lease. Consent to one
Assignment shall not destroy or waive this provision, and all later
Assignments shall likewise be made only upon prior written consent of
Landlord. Assignees shall become liable directly to Landlord for all
obligations of Tenant hereunder, without relieving Tenant's liability. In
the event that Tenant shall be entitled to any rent, rentals, payment,
profit or any other sum or cost paid by the assignee or subtenant in
connection with such Assignment in excess of the then applicable rent and
other charges payable by Tenant to Landlord under this Lease ("Excess
Rental"), then as and when such Excess Rental is received from such
assignee or subtenant, Tenant may retain one-half of such Excess Rental,
and Tenant shall pay one-half of such Excess Rental to Landlord.
In determining whether to consent or withhold consent to a proposed
Assignment, Landlord and Tenant agree that Landlord may withhold its
consent to any proposed Assignment, and such withholding of consent by
Landlord will not be unreasonable, if: (1) if the proposed assignee or
subtenant is a party who would, or whose use would, detract from the
character of the Building, such as, without limitation, a dental, medical,
chiropractic or a governmental office; or (2) if the proposed assignee or
subtenant proposes to engage in a business in the Premises which is not
consistent with the standards of the Building or is not permitted by or
would contravene the provisions of this Lease; or (3) if the lease to, or
use of the Premises or any portion thereof by, such
15
subtenant or assignee will cause Landlord to be in violation of any
restrictive use covenants granted by Landlord to any other tenant in the
Project in such tenant's lease; or (4) if, in the case of a proposed
assignment, the proposed assignee is not of sufficient financial worth to
perform its obligations under this Lease as such obligations become due;
or (5) the proposed assignee or subtenant is then a tenant in the Project,
or is then negotiating with Landlord to become a tenant in the Project;
provided, however, it is understood and agreed that bases set forth above
upon which Landlord may reasonably withhold its consent to a proposed
Assignment are not intended, and shall not be construed, to be an
exclusive list of reasonable bases upon which Landlord may withhold its
consent, and Landlord reserves the right to withhold its consent to any
proposed Assignment by virtue of any other reasonable basis.
Upon execution of any sublease or assignment approved by Landlord under
this Article, a fully-executed counterpart of the sublease or assignment
shall be promptly delivered to Landlord by Tenant.
A change, whether voluntary, involuntary or by operation of law, or a
merger, consolidation or other reorganization of more than a 49% ownership
in Tenant shall be an assignment of this Lease and subject to the
provisions of this Article.
Notwithstanding the foregoing, Tenant may, without securing Landlord's
consent, do any one or more of the following things (each of which is a
"Permitted Assignment"):
(i) Assign this Lease or sublet the Premises, in whole or in part, to
any subsidiary company, parent company, or other affiliated company
of Tenant; as used herein, a company is an "affiliated" company of
Tenant if it directly or indirectly controls, or is controlled by,
or is under direct or indirect common control with, Tenant; and, as
used herein, "control" means the power to direct the management and
policies of an entity, directly or indirectly, through the exercise
of voting rights; and/or
(ii) Assign this Lease or sublet the Premises to any company with which
Tenant may merge, consolidate or be sold to, or to any company
resulting from a merger or consolidation to which Tenant may be a
party; and/or
(iii) Assign this Lease or sublet the Premises pursuant to a
reorganization under which a majority of the capital stock or
substantially all of the assets of Tenant are acquired by a
publicly owned company; and/or
(iv) Assign this Lease or sublet the Premises to any person, firm, or
corporation purchasing all or substantially all of Tenant's assets
or a controlling interest in Tenant's stock; and/or
(v) Assign this Lease or sublet the Premises to any person, firm, or
corporation who has a net worth exceeding Twenty-five Million
Dollars ($25,000,000.00).
Provided, that in the event of such Permitted Assignment, (a) the use of
the Premises to be made by the assignee under such Permitted Assignment
(the "Permitted Assignee") will be substantially the same as the use then
being made of the Premises by Tenant, and will be within the permitted
uses of the Premises under the Lease; (b) no later than fifteen (15) days
after the effective date of the assignment of the Lease or the subletting
of the Premises to a Permitted Assignee, Tenant provides Landlord with
written notice of
16
such assignment or subletting, including (i) the written acknowledgment of
Tenant that Tenant remains fully liable for all of Tenant's obligations
under this Lease until the expiration of the Term of the Lease, and (ii)
in the case of an assignment of the Lease to the Permitted Assignee, the
express assumption by the Permitted Assignee of all obligations of Tenant
under the Lease and the Permitted Assignee's express agreement to be bound
by all terms and conditions of the Lease; and (c) Tenant provides Landlord
with all documentation reasonably requested by Landlord in order to
evaluate the Permitted Assignment.
16. EMINENT DOMAIN
If the whole or any part of the Premises shall be taken by Federal, State,
County or City authority for public use, or under any statute, or by right
of eminent domain (or is conveyed by Landlord in lieu of such taking),
then the Term hereby granted and all rights of the Tenant hereunder shall
cease and terminate as of the day before the effective date of such
taking. It is expressly agreed that the Tenant shall not have any right or
claim to any award made to or received by the Landlord for such taking.
Provided, however, that Tenant shall have the right to separately pursue
an award from the condemning authority for its damages incurred in
relocating its business to other premises, so long as such award or the
pursuit thereof will not reduce any award that would otherwise be
available to Landlord from such condemning authority.
17. DESTRUCTION OR DAMAGE TO PREMISES
If the Premises shall be damaged or destroyed in whole or in part by fire,
casualty or other causes covered by Landlord's insurance, Landlord shall
promptly and diligently restore the Premises to their condition on the
date originally demised to Tenant under this Lease, including the
"Improvements" to the Premises constructed by Tenant in accordance with
the provisions of Exhibit "C" to this Lease, ordinary wear and tear
excepted ("Landlord's Restoration"), provided that, in Landlord's
reasonable estimation, such repairs can be made within one hundred twenty
(120) days of such destruction or damage. In the event that restoration of
the Premises estimated by Landlord to take one hundred twenty (120) days
or less to complete has not been substantially completed within one
hundred twenty (120) days after the occurrence of such damage or
destruction, then Tenant shall have the option of terminating this Lease,
provided that (i) at the time Tenant is required to exercise such option,
Landlord is not then actively in the process of completing such
restoration; (ii) the delay in substantial completion of the restoration
of the Premises is not caused, in whole or in part, by Tenant or any force
majeure; and (iii) Tenant provides Landlord with written notice that
Tenant elects to exercise such option no later than fifteen (15) days
following the expiration of such one hundred twenty (120) day period. In
the event that Tenant exercises its option to terminate this Lease in
accordance with the terms of this paragraph, such termination shall be
effective on the thirtieth (30th) day following Landlord's receipt of
Tenant's notice exercising such option; and, the Term of the Lease shall
expire on such thirtieth (30th) day as if such date were the Expiration
Date. Tenant shall, upon substantial completion by Landlord, promptly and
diligently, and at its sole cost and expense, repair and restore any
improvements to the Premises made by Tenant after the Rent Commencement
Date to the condition thereof prior to such destruction or damage. If, in
Landlord's reasonable estimation, the Premises cannot be restored, to the
extent required herein, within one hundred twenty (120) days of such
damage or destruction, Landlord at its option shall, by written notice to
Tenant given within sixty (60) days after the date of such fire or other
casualty, either (i) elect to repair or restore such damage, this Lease
continuing in full force and effect, or (ii) terminate this Lease as of a
date specified in such notice, which date shall not be less than thirty
(30) nor more than sixty (60) days after the date such notice is given.
Until Landlord's Restoration is complete, there shall be an abatement or
reduction of Base Rental and Additional Rental for Operating Expenses only
(and not Taxes) in the same proportion that the square footage of the
Premises so damaged or destroyed and under restoration bears to the total
square footage of the Premises, unless the damaging event was caused by
the negligence or willful misconduct of Tenant, its employees, officers,
agents, licensees, invitees, visitors, customers, concessionaires,
assignees, subtenants, contractors or subcontractors, in which event there
shall be no such abatement.
17
Notwithstanding the foregoing provisions of this paragraph, if damage to
or destruction of the Premises, in excess of fifty percent (50%) of the
value of the Premises, shall occur within the last year of the Term of
this Lease, as the same may be extended as provided hereinafter, the
obligation of Landlord to restore the Premises shall not arise unless (i)
Landlord, at its sole option, elects to undertake Landlord's Restoration;
(ii) neither party has elected to terminate this Lease as provided below;
(iii) Landlord, at its sole option, elects to provide Tenant with the
opportunity of extending the Term of this Lease for an additional period
so as to expire five (5) years from the date of the completion by Landlord
of Landlord's Restoration; and, (iv) Tenant gives written notice to
Landlord within thirty (30) days after Landlord's request that it agrees
to such extension. Such extension shall be on the terms and conditions
provided herein, if an option to extend this Lease remains to be exercised
by Tenant hereunder, or under the terms prescribed in Landlord's notice,
if no such further extension period is provided for herein. Upon receipt
of such notice from Tenant, Landlord agrees to promptly undertake
Landlord's Restoration. Failing such notice to extend, Landlord at its
option shall have the right to terminate this Lease as of the date of the
damaging event, or to restore the Premises and the Lease shall continue
for the remainder of the then unexpired Term, or until the Lease is
otherwise terminated as provided herein. Additionally, if damage to or
destruction of the Premises, in excess of fifty percent (50%) of the value
of the Premises, shall occur within the last year of the Term of this
Lease, as the same may be extended by the parties from time to time, then
Tenant shall have the option of terminating this Lease by providing
Landlord with written notice of such termination no later than thirty (30)
days after the occurrence of such damage or destruction, and in such event
this Lease shall be terminated effective on the thirtieth (30th) day
following Landlord's receipt of Tenant's notice exercising such option;
and, the Term of the Lease shall expire on such thirtieth (30th) day as if
such date were the Expiration Date.
18. INDEMNIFICATION
Subject to the other provisions of this Lease, Tenant hereby indemnifies
Landlord from and agrees to hold Landlord harmless against, any and all
liability for any loss, injury, or damage (collectively, a "Loss"),
including, without limitation, all costs, expenses, court costs and
reasonable attorneys' fees, imposed on Landlord by any person whomsoever,
caused by or resulting from (i) any Loss occurring in the Premises (except
where such Loss is caused by or results from the gross negligence or
willful misconduct of Landlord or its employees, agents or contractors);
and (ii) any Loss occurring in the Building or anywhere in the Project
other than the Premises that is caused by or results from the gross
negligence or willful misconduct of Tenant, its employees, agents or
contractors. Subject to the provisions of this Lease, Landlord hereby
indemnifies Tenant from, and agrees to hold Tenant harmless against, any
and all liability for any Loss occurring in the Premises, the Building or
anywhere in the Project, including, without limitation, all costs,
expenses, court costs and reasonable attorneys' fees, imposed on Tenant by
any person whomsoever, caused by or resulting from the gross negligence or
willful misconduct of Landlord or its employees, agents or contractors.
The provisions of this paragraph shall survive the expiration or any
termination of this Lease.
19. INSURANCE
(a) Landlord's Insurance.
(1) Landlord shall obtain and keep in force during the Term of this
Lease an insurance policy or policies of all-risks fire, extended
coverage, theft, vandalism, malicious mischief and other casualty,
covering loss or damages to the Project and the Common Areas, as
well as all improvements thereto, and the structural improvements
to the Premises.
(2) Landlord shall also obtain and keep in force during the Term of
this Lease such other insurance in such amounts and with such
policy provisions as it shall deem necessary or appropriate,
including without limitation the following: commercial general
liability insurance pertaining to the Project and the Common Areas,
and bodily injuries, death and property damage arising or occurring
therein.
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(3) Tenant shall reimburse Landlord for any increase in the cost of
any of Landlord's insurance pertaining to the Project if said
increase is caused by or results from Tenant's use or occupancy of
the Premises, the breach of this Lease by Tenant, or the acts,
omissions, or negligence of Tenant, its employees, officers,
agents, licensees, invitees, visitors, customers, concessionaires,
assignees, subtenants, contractors or subcontractors.
Landlord shall deliver to Tenant a certificate of insurance reflecting
that the insurance that Landlord is required to maintain under this Lease
has been obtained and is in full force and effect upon Landlord's receipt
of Tenant's written request for same.
(b) TENANT'S INSURANCE. During the Term of this Lease, and any extension and
renewal thereof, Tenant, at its sole cost and expense, shall carry and
maintain the following policies of insurance with insurance companies
licensed or authorized to do business in the Commonwealth of Massachusetts
and rated as no less than A-, Class VI in the current edition of Best's
Guide, insuring Landlord, Landlord's management agent and authorized
agent, Tenant, and any lender of record encumbering the Premises if
requested by Landlord, and shall deliver to Landlord a certificate of
insurance evidencing such coverage both prior to taking possession of the
Premises and annually thereafter:
(1) Property Insurance on the Special or All-Risk Form (including
theft, sprinkler leakage, boiler and machinery insurance), covering
Tenant's personal property, trade fixtures, inventory and equipment
located in the Premises in an amount equal to the full replacement
cost of all items.
(2) Commercial General Liability Insurance on an occurrence form
including premises operations, products/completed operations,
hazard and contractual coverage with limits of no less than
$2,000,000 per occurrence, $2,000,000 General Aggregate and
$2,000,000 Completed Operations Aggregate. The insurance required
of Tenant hereunder may be satisfied by an umbrella policy, so long
as the minimum coverage requirements set forth under this paragraph
are satisfied.
(3) Workers' Compensation Insurance with liability limits required by
the laws of the state in which the Premises are located and
employers liability coverage.
(4) Business Interruption Insurance in amounts sufficient to pay for
Tenant's expenses and lost income attributable to perils commonly
insured against by prudent tenants or attributable to prevention of
access to the Premises as a result of such perils.
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Tenant's Commercial General Liability insurance shall, to the
extent permitted by law, name Landlord, Landlord's management agent
and authorized agent as additional insureds, and all Tenant's
insurance required hereunder shall provide for thirty (30) days'
prior written notice to Landlord and its asset and property manager
before any modification or termination of said insurance. The
above-referenced insurance shall be considered primary and
non-contributory with or secondary to coverage provided by
Landlord. Landlord reserves the right to require additional
coverage and increase limits as industry standards change. Should
Tenant engage the services of a contractor, Tenant will make
certain that such contractor will carry General Liability Insurance
and will name Landlord and its asset and property manager as
additional insureds.
(c) WAIVER OF SUBROGATION. Landlord and Tenant shall each have included (so
long as commercially reasonable and obtainable) in all policies of all
risks, fire, extended coverage, business interruption and other property
insurance respectively obtained by them covering the Premises, the
Building and contents therein, a waiver by the insurer of all right of
subrogation against the other in connection with any loss or damage
thereby insured against. Any additional premium for such waiver shall be
paid by the primary insured. To the full extent permitted by law, Landlord
and Tenant each waives all right of recovery against the other (and any
officers, directors, partners, employees, agents, and representatives of
the other) for, and agrees to release the other from liability for, loss
or damage to the extent such loss or damage is covered by valid and
collectible insurance in effect covering the party seeking recovery at the
time of such loss or damage or would be covered by the insurance required
to be maintained under this Lease by the party seeking recovery. If the
release of either party, as set forth in the immediately preceding
sentence, should contravene any law with respect to exculpatory
agreements, the liability of the party in question shall be deemed not
released but shall be secondary to the liability of the other's insurer.
20. DAMAGE OR THEFT OF PERSONAL PROPERTY
Tenant agrees that all personal property brought into the Premises shall
be at the risk of the Tenant only and that the Landlord shall not be
liable for the loss thereof or any damages thereto occasioned from any act
of any co-tenant, or other occupants of said Building or any other person,
unless such loss results from the gross negligence or willful misconduct
of Landlord.
21. HAZARDOUS MATERIALS
Tenant agrees that Tenant, its agents and contractors, licensees, or
invitees shall not handle, use, manufacture, store or dispose of any
flammables, explosives, radioactive materials, hazardous wastes or
materials, toxic wastes or materials, or other similar substances,
petroleum products or derivatives (collectively "Hazardous Materials") on,
under, or about the Premises, without Landlord's prior written consent
(which consent shall not be unreasonably withheld as long as Tenant
demonstrates and documents to Landlord's reasonable satisfaction (i) that
such Hazardous Materials (A) are necessary or useful to Tenant's business;
and (B) will be used, kept, and stored in compliance with all laws
relating to any Hazardous Materials so brought or used or kept in or about
the Premises; and (ii) that Tenant will give all required notices
concerning the presence in or on the Premises (or the release of such
Hazardous Materials from the Premises) provided that Tenant may handle,
store, use or dispose of products containing small quantities of Hazardous
Materials, which products are of a type customarily found in offices and
households (such as aerosol cans containing insecticides, toner for
copies,
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paint, paint remover, and the like), provided further that Tenant shall
handle, store, use and dispose of any such Hazardous Materials in a safe
and lawful manner and shall not allow such Hazardous Materials to
contaminate the Premises or the environment. Tenant shall comply with all
federal, state and local laws and ordinances relating to the protection of
the environment or the keeping, use or disposition of environmentally
hazardous materials, substances, or wastes, presently in effect or
hereafter adopted, all amendments to any of them, and all rules and
regulations issued pursuant to any of such laws or ordinances
(collectively "Environmental Laws").
Tenant further agrees that Tenant will not permit any substance suspected
of causing cancer or reproductive toxicity to come into contact with
groundwater under the Premises. Any such substance coming into contact
with groundwater shall be considered a Hazardous Material for purposes of
this Article.
Notwithstanding the above provisions, Tenant may handle, store, and use
Hazardous Materials, limited to the types, amounts, and use identified in
the Hazardous Materials List, if any are identified, on Exhibit "D"
attached hereto. Tenant hereby certifies to Landlord that the information
provided by Tenant pursuant to this paragraph is true, correct, and
complete. Tenant covenants to comply with the use restrictions shown on
the attached Hazardous Materials List. Tenant's business and operations,
and more especially its handling, storage, use and disposal of Hazardous
Materials shall at all times comply with all applicable laws pertaining to
Hazardous Materials. Tenant shall secure and abide by all permits
necessary for Tenant's operations on the Premises. Tenant shall give or
post all notices required by all applicable laws pertaining to Hazardous
Materials. If Tenant shall at any time fail to comply with this Paragraph,
Tenant shall immediately notify Landlord in writing of such noncompliance.
Tenant shall provide Landlord with copies of any Material Safety Data
Sheets (as required by the Occupational Safety and Health Act) relating to
any Hazardous Materials to be used, kept, or stored at or on the Premises,
at least 30 days prior to the first use, placement, or storage of such
Hazardous Material on the Premises. Landlord shall have 10 days following
delivery of such Material Safety Data Sheets to forbid, or, in its sole
discretion, to approve subject to the limitations contained above, such
use, placement, or storage of a Hazardous Material on the Premises.
Tenant shall not store hazardous wastes on the Premises for more than 90
days; "hazardous waste" has the meaning given it by the Resource
Conservation and Recovery Act of 1976, as amended. Tenant shall not
install any underground or above ground storage tanks on the Premises.
Tenant shall not dispose of any Hazardous Material or solid waste on the
Premises. In performing any alterations of the Premises permitted by the
Lease, Tenant shall not install any Hazardous Material in the Premises
without the specific consent of Landlord attached as an exhibit to this
Article.
Any increase in the premiums for necessary insurance on the Property which
arises from Tenant's use and/or storage of Hazardous Materials shall be
solely at Tenant's expense. Tenant shall procure and maintain, at its sole
expense, such additional insurance as may be necessary to comply with any
requirement of any Federal, State or local governmental agency with
jurisdiction.
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If Landlord, in its sole discretion, believes that the Premises or the
environment have become contaminated with Hazardous Materials that must be
removed under the laws of the state where the Premises are located, in
breach of the provisions of this Lease, Landlord, in addition to its other
rights under this Lease, may enter upon the Premises and obtain samples
from the Premises, including without limitation the soil and groundwater
under the Premises, for the purposes of analyzing the same to determine
whether and to what extent the Premises or the environment have become so
contaminated. Tenant shall reimburse Landlord for the costs of any
inspection, sampling and analysis that discloses contamination for which
Tenant is liable under the terms of this Article. Tenant may not perform
any sampling, testing, or drilling to locate any Hazardous Materials on
the Premises without Landlord's prior written consent.
Without limiting the above, Tenant shall reimburse, defend, indemnify and
hold Landlord harmless from and against any and all claims, losses,
liabilities, damages, costs and expenses, including without limitation,
any actual or asserted failure of Tenant to fully comply with all
applicable Environmental Laws, and any loss of rental income, loss due to
business interruption, and attorneys fees and costs, arising out of or in
any way connected with the use, manufacture, storage, or disposal of
Hazardous Materials by Tenant, its agents or contractors on, under or
about the Premises including, without limitation, the costs of any
required or necessary investigation, repair, cleanup or detoxification and
the preparation of any closure or other required plans in connection
herewith, whether voluntary or compelled by governmental authority. The
indemnity obligations of Tenant under this clause shall survive any
termination of the Lease. At Landlord's option, Tenant shall perform any
required or necessary investigation, repair, cleanup, or detoxification of
the Premises. In such case, Landlord shall have the right, in its sole
discretion, to approve all plans, consultants, and cleanup standards.
Tenant shall provide Landlord on a timely basis with (i) copies of all
documents, reports, and communications with governmental authorities; and
(ii) notice and an opportunity to attend all meetings with regulatory
authorities. Tenant shall comply with all notice requirements and Landlord
and Tenant agree to cooperate with governmental authorities seeking access
to the Premises for purposes of sampling or inspection. No disturbance of
Tenant's use of the Premises resulting from activities conducted pursuant
to this paragraph shall constitute an actual or constructive eviction of
Tenant from the Premises. In the event that such cleanup extends beyond
the termination of the Lease, Tenant's obligation to pay rent (including
additional rent and percentage rent, if any) shall continue until such
cleanup is completed and any certificate of clearance or similar document
has been delivered to Landlord. Rent during such holdover period shall be
at market rent; if the parties are unable to agree upon the amount of such
market rent, then Landlord shall have the option of (a) increasing the
rent for the period of such holdover based upon the increase in the
cost-of-living from the third month preceding the commencement date to the
third month preceding the start of the holdover period, using such indices
and assumptions and calculations as Landlord in its sole reasonable
judgement shall determine are necessary; or (b) having Landlord and Tenant
each appoint a qualified MAI appraiser doing business in the area; in
turn, these two independent MAI appraisers shall appoint a third MAI
appraiser and the majority shall decide upon the fair market rental for
the Premises as of the expiration of the then current term. Landlord and
Tenant shall equally share in the expense of this appraisal except that in
the event the rent is found to be within fifteen percent of the original
rate quoted by Landlord, then Tenant shall bear the full cost of all the
appraisal process. In no event shall the rent be subject to determination
or modification by any person, entity, court, or authority other than as
set forth expressly herein, and in no event shall the rent for any
holdover period be less than the rent due in the preceding period.
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Notwithstanding anything set forth in this Lease, Tenant shall only be
responsible for contamination of the Premises by Hazardous Materials or
any cleanup resulting directly therefrom, if the matter which resulted in
the contamination occurred or the Hazardous Materials were deposited
during the Lease Term, or during any other period of time during which
Tenant is in actual or constructive occupancy of the Premises. Tenant
shall take reasonable precautions to prevent the contamination of the
Premises with Hazardous Materials by third parties.
It shall not be unreasonable for Landlord to withhold its consent to any
proposed Assignment if (i) the proposed assignee's or sublessee's
anticipated use of the premises involves the generation, storage, use,
treatment or disposal of Hazardous Materials; (ii) the proposed assignee
or sublessee has been required by any prior landlord, lender, or
governmental authority to take remedial action in connection with
Hazardous Materials contaminating a property, if the contamination
resulted from such assignee's or sublessee's actions or use of the
property in question; or (iii) the proposed assignee or sublessee is
subject to an enforcement order issued by any governmental authority in
connection with the use, disposal, or storage of Hazardous Materials.
Any of Tenant's insurance insuring against claims of the type dealt with
in this Article shall be considered primary coverage for claims against
the Property arising out of or under this paragraph.
In the event of any transfer of Tenant's interest under this Lease, Tenant
shall continue to be fully liable for all of its obligations set forth
herein regarding Hazardous Materials arising under this Lease throughout
the entire Term of this Lease. In the event that the Premises become
contaminated with Hazardous Materials, and Tenant is responsible for such
contamination as set forth herein, then Tenant's duty to pay Base Rental
and Additional Rental shall continue until the obligations imposed by this
Lease and such laws are satisfied in full and any certificate of clearance
or similar document has been delivered to Landlord.
All consents given by Landlord pursuant to this Article shall be in
writing. Landlord hereby agrees to indemnify, defend, and hold Tenant
harmless from any and all claims, demands, actions, liabilities, costs,
expenses, damages and obligations of any nature arising from, or as a
result of the presence or use of any Hazardous Materials anywhere in the
Project, Building or the Premises, other than the presence or use of
Hazardous Materials for which Tenant is responsible under this Lease.
22. LANDLORD'S LIEN
[TEXT INTENTIONALLY DELETED.]
23. RELOCATION
[TEXT INTENTIONALLY DELETED.]
24. SUBORDINATION AND ATTORNMENT
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Tenant agrees that this Lease shall be subject and subordinate to any
mortgage, security deed, loan deed or similar instrument now on said
Premises and to all advances already made, or which may be hereafter made,
on account of said instruments to the full extent of all debts and charges
secured thereby and to any renewals or extensions of all or any part
thereof and to any such instruments which any owner of said Premises may
hereafter at any time elect to place on said Premises (collectively, a
"Security Instrument"), and Tenant agrees upon request to hereafter attorn
to the holder of such Security Instrument as the Landlord under this Lease
and execute any paper or papers which the counsel for Landlord may deem
necessary to accomplish that end and, if Tenant fails to do so, Tenant
shall be in default of its non-monetary obligations under this Lease.
Provided, however, that the subordination of this Lease and Tenant's
interest hereunder to any Security Instrument shall be contingent upon
Landlord, Tenant and the holder of the security interest under such
instrument entering into an agreement reasonably acceptable to each of
them whereby such holder agrees that Tenant's right of quiet enjoyment of
the Premises will not be disturbed in the event of a foreclosure of such
holder's interest under such instrument, so long as Tenant does not
default in its obligations under this Lease, and fail to cure such default
within the time provided in this Lease for the cure of defaults, if any.
25. ESTOPPEL CERTIFICATE
Upon Landlord's request, Tenant shall execute and deliver to the Landlord,
within ten (10) days from Tenant's receipt of said request, a statement in
writing certifying that this Lease is in full force and effect, and
setting forth the dates to which the rent and any other charges have been
paid, and such statement so delivered to the Landlord may be relied upon
by any prospective purchaser of, or by any holder or prospective holder of
a mortgage or other security interest in the Building of which the
Premises are a part. Tenant's failure to deliver such statement within
such time shall be conclusive upon Tenant that this Lease is in full force
and effect, without modification, except as may be represented by
Landlord, that there are no defaults in Landlord's performance, and that
not more than one (1) month's rental has been paid in advance.
Upon Tenant's request, Landlord shall execute and deliver to Tenant,
within ten (10) days from Landlord's receipt of said request, a statement
in writing certifying that this Lease is in full force and effect, and
setting forth the dates to which the rent and any other charges have been
paid. Landlord's failure to deliver such statement within such time shall
be conclusive upon Landlord that this Lease is in full force and effect,
without modification, except as may be represented by Tenant, and that, to
the best of Landlord's knowledge without inquiry, there are no defaults in
Tenant's performance under the Lease. Provided, however, that Tenant may
not request such statement from Landlord any more frequently than twice in
any Lease Year.
26. DEFAULT
The occurrence of any of the following shall constitute a default
hereunder by Tenant:
(a) The Base Rental payable under this Lease (including any Additional
Rental) or any sum of money due hereunder is not paid when due, and
such failure to pay continues for more than five (5) days after
Tenant's receipt of notice thereof from Landlord. Provided,
however, that Landlord shall not be required to provide Tenant with
the notice and five-day period set forth in this subparagraph more
than two (2) times during the Term of this Lease, and the third and
each subsequent failure to timely pay such sums shall immediately
constitute an event of default hereunder.
24
(b) The Premises are abandoned, even though the Tenant continues to pay
the stipulated Base Rental, and such condition is not corrected
within ten (10) days of Tenant's receipt of notice thereof from
Landlord to Tenant. Provided, however, that Landlord shall not be
required to provide Tenant with the notice and ten-day period set
forth in this subparagraph more than once during the Term of this
Lease, and the second, and each subsequent occurrence of such
condition shall immediately constitute an event of default
hereunder.
(c) Tenant files any petition for debt relief under any section or
chapter of the national or federal bankruptcy code or any other
applicable federal or state bankruptcy, insolvency or other similar
act.
(d) Any petition is filed against Tenant under any section or chapter
of the national or federal bankruptcy code or any other applicable
federal or state bankruptcy, insolvency or other similar act, and
such petition is not dismissed within sixty (60) days after the
date of such filing.
(e) Tenant shall become insolvent or transfer property to defraud
creditors.
(f) Tenant makes material misrepresentations to Landlord prior to or
contemporaneously with the execution of this Lease.
(g) Tenant shall make an assignment for the benefit of creditors.
(h) A receiver is appointed for any of the assets of Tenant, and such
receiver is not removed within sixty (60) days of Tenant's receipt
of notice from Landlord to obtain such removal.
(i) A lien is filed against the Premises, Building or Project, or
Landlord's estate therein, by reason of any work, labor, services
or materials performed or furnished, or alleged to have been
performed or furnished, to Tenant or anyone holding the Premises
by, through or under Tenant, and Tenant fails to cause the same to
be vacated and canceled of record, or bonded off in accordance with
the provisions of this Lease, within twenty (20) days after
Tenant's receipt of written notice of the existence of such lien
from Landlord.
(j) Tenant fails to observe, perform and keep each and every one of the
covenants, agreements, provisions, stipulations and conditions
contained in this Lease to be observed, performed and kept by
Tenant, including without limitation the "Rules and Regulations"
for the Project of which the Premises is a part, and unless
otherwise specified herein, Tenant persists in such failure for
twenty (20) days after receipt of notice by Landlord requiring that
Tenant correct such failure; provided, that in the event any such
failure is not reasonably susceptible of cure within such twenty
(20)-day period, Tenant shall have a reasonable time to cure such
failure, provided Tenant commences cure as soon as is reasonably
possible, and prosecutes such cure diligently to completion.
27. REMEDIES
Upon the occurrence of a default by Tenant, Landlord shall have the option
to do and perform any one or more of the following:
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(a) Landlord may terminate this Lease, in which event Tenant shall immediately
surrender the Premises to Landlord. If Tenant shall fail to do so,
Landlord may, without notice and prejudice to any other remedy available,
enter and take possession of the Premises and remove Tenant, or anyone
occupying the Premises, and its effects without being liable to
prosecution or any claim for damages. In the event of termination of this
Lease, Tenant shall be responsible to Landlord for (i) all payments due
under this Lease prior to the date of termination, (ii) all costs incurred
by Landlord in connection with such termination, and (iii) the entire
amount of Base Rental, Additional Rental and other charges due hereunder
for the remainder of the Term, less the then fair market rental value of
the Premises for the remainder of the Term, with such difference
discounted to its present value by using a discount factor of 6%. Such
amount shall be paid by Tenant to Landlord immediately upon demand by
Landlord and shall constitute liquidated damages and not a penalty or
forfeiture (Tenant and Landlord agree that the actual damages are
impossible to ascertain and that the amount described above is a
reasonable estimate thereof). If Landlord elects to terminate this Lease,
Tenant's liability to Landlord for damages shall survive such termination.
(b) Landlord may correct such default, and Tenant shall reimburse Landlord,
upon demand, for the cost incurred by Landlord in curing such default.
(c) Landlord may terminate Tenant's right of possession of the Premises
without terminating this Lease. Landlord may enter upon and take
possession of the Premises as agent of Tenant without terminating this
Lease (termination of this Lease shall only occur by written notice of
such termination from Landlord to Tenant) and without being liable to
prosecution or any claim for damages. In the event that Landlord
terminates Tenant's right of possession of the Premises without
terminating the Lease, then Landlord shall make commercially reasonable
efforts to relet the Premises. In the event that Landlord relets the
Premises, Landlord may make any reasonable alterations or refurbish the
Premises, or both, or change the character or use of the Premises.
Landlord may relet all or any portion of the Premises, alone or in
conjunction with other portions of the Building, for a term longer or
shorter than the Term of this Lease, at a rental rate other than that
provided in this Lease, and upon such other terms (including the granting
of concessions) as Landlord reasonably determines to be acceptable. If
Landlord elects to reenter and relet all or any portion of the Premises,
Landlord shall apply the rent so collected as follows:
(1) first, to any amount due hereunder other than Base Rental and
Additional Rental;
(2) second, to the payment of costs and expenses of such reletting;
(3) third, to the payment of Base Rental and Additional Rental;
(4) fourth, the residue shall be held and applied to future Base Rental
and Additional Rental due hereunder, and if any such excess exists
at the termination of this Lease it shall be paid over to Tenant.
26
No such reentry or taking possession of the Premises shall be construed as
an election on Landlord's part to terminate this Lease unless a written
notice of such intention is given to Tenant. Landlord, however, shall have
no duty to relet the Premises, and Landlord's failure to do so shall not
release Tenant's liability for rent or damages. Tenant shall remain fully
liable to Landlord for the deficiency between any rent collected as a
result of reletting and the rent and other sums that are owed from Tenant
to Landlord under this Lease. Landlord shall have the right to rent any
other available space in the building before reletting or attempting to
relet the Premises.
(d) In addition to all other sums that are owed by Tenant to Landlord under
this Lease, upon such event of default, Tenant shall become liable for any
costs incurred by Landlord under this Lease for the completion of any
improvements to the Premises, and any real estate commissions paid by
Landlord under this Lease (collectively, the "Landlord's Costs"), to the
extent set forth in this paragraph. The entire amount of the Landlord's
Costs shall be amortized evenly over the Lease Term, and so long as Tenant
does not default in its obligations under this Lease, and fail to cure
such default within the applicable period of cure, if any, provided under
this Lease, then Tenant shall have no liability to Landlord for the
repayment of any portion of the Landlord's Costs. However, in the event
that Tenant shall default in its obligations under this Lease, and Tenant
shall fail to cure such default within the applicable period of cure, if
any, provided under this Lease, then in addition to all of Landlord's
other remedies available under this Lease, Tenant shall also be liable to
Landlord for the portion of the Landlord's Costs that remains amortized
but unpaid between the date of such default and the expiration of the Term
of this Lease.
(e) The above-stated remedies of Landlord are to be in addition to, and not in
lieu of, any other rights and remedies provided Landlord either at law or
in equity. No delay in enforcing the provisions of the Lease shall be
deemed to constitute a waiver of such default by Landlord, and the pursuit
by Landlord of one or more remedies shall not be deemed to constitute an
election against other remedies.
28. EFFECT OF TERMINATION OF LEASE
No termination of this Lease prior to the normal ending thereof by lapse
of time or otherwise shall affect Landlord's right to collect sums due
hereunder for the period prior to termination thereof.
29. ATTORNEYS' FEES
If any rent or other sum due and owing under this Lease is collected by or
through an attorney at law, then, in addition to such sums, Tenant shall
also pay Landlord's reasonable attorneys' fees and other reasonable costs
incurred in such collection. In the event that any dispute under this
Lease shall result in litigation, then the non-prevailing party shall
reimburse the prevailing party for its actual reasonable attorneys' fees
incurred in bringing or defending such action; provided, however that a
recovery of attorneys' fees by Landlord against Tenant under this sentence
shall include, but shall not duplicate, the recovery by Landlord against
Tenant of its reasonable attorneys' fees and other reasonable costs of
collection permitted under the first sentence of this Section.
30. QUIET ENJOYMENT
Landlord represents and warrants that it has the full right and authority
to enter into this Lease and that Tenant, while paying the rental and
performing its other covenants and agreements contained in this Lease,
shall peaceably and quietly have, hold and enjoy the Premises for the Term
without hindrance or disturbance from Landlord, or any party claiming an
interest in the Premises by or through Landlord, subject to the terms and
provisions of this Lease.
27
31. SURRENDER OF PREMISES
At the termination of this Lease, Tenant shall surrender the Premises and
keys thereto to Landlord in same condition as at commencement of the Term,
together with the Improvements defined in Exhibit "C," normal wear and
tear, loss by fire or other casualty not caused by Tenant, Tenant's
employees, agents or contractors, and condemnation excepted.
32. HOLDING OVER
If Tenant remains in possession of the Premises after expiration of the
Term hereof, without Landlord's written consent, Tenant shall be a
holdover tenant at sufferance, and there shall be no renewal of this Lease
by operation of law. During the first two (2) months of any holdover,
Tenant shall pay holdover rent equal to 150% of the last Base Rental and
Additional Rental amount due from Tenant prior to such holdover;
thereafter and for the remainder of any such holdover period, Tenant shall
pay holdover rent equal to 200% of the last Base Rental and Additional
Rental amount due from Tenant prior to any holdover.
33. REMOVAL OF FIXTURES
Tenant may prior to the expiration of this Lease, or any extension
thereof, remove all unattached and movable personal property and equipment
which Tenant has placed in the Premises, provided Tenant repairs all
damages to the Premises caused by such removal. All personal property of
Tenant remaining on the Premises after the end of the Term shall be deemed
conclusively abandoned, notwithstanding that title to or a security
interest in such personal property may be held by an individual or entity
other than Tenant, and Landlord may dispose of such personal property in
any manner it deems proper, in its sole discretion, and Tenant shall
reimburse Landlord for the cost of removing such personal property. Tenant
hereby waives and releases any claim against Landlord arising out of the
removal or disposition of such personal property, and Tenant hereby agrees
to indemnify and hold Landlord harmless from and against the claims of all
third parties resulting from such removal. Tenant's obligations under this
paragraph shall survive the expiration or earlier termination of this
Lease.
34. NOTICES
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Any notice or other communication required or permitted to be given under
this Lease must be in writing and shall be effectively given or delivered
if hand delivered to the addresses for Landlord and Tenant stated below,
or if sent by certified United States Mail, return receipt requested, or
if sent by receipted overnight delivery service to said addresses. Notice
effected by hand delivery or receipted overnight delivery service shall be
deemed to have been received upon the earlier of actual receipt or refusal
thereof. Any notice mailed shall be deemed to have been received upon the
earlier of (a) actual receipt, (b) refusal thereof, or (c) three (3) days
after mailing of same. Either party shall have the right to change its
address to which notices shall thereafter be sent, and the party to whose
attention such notice shall be delivered, by giving the other party notice
thereof in accordance with the provisions of this paragraph; provided,
however, that the party in actual or constructive possession of the
Premises under this Lease from time to time may not change its address to
which notices shall thereafter be sent to eliminate the Premises as an
acceptable address where notices to such party may be forwarded or
delivered. Until such time as either party shall change its address for
notices, notices shall be forwarded as follows:
To Landlord: EastWest Property Fund, L.P.
c/o TMW Real Estate Management, Inc.
0000 Xxxxxxxxxx Xxxxx Xxxxxxx
Xxxxx 000
Xxxxxxx, Xxxxxxx 00000
Attention: Director of Asset Management
WITH A COPY TO:
Lincoln Property Company
000 Xxxx Xxxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
Attention: Building Manager
To Tenant: Xxxx Xxxxx' idealab!
000 Xxxxxxx Xxxxxx
Xxxxx 000
Xxxxxx, Xxxxxxxxxxxxx 00000
Attention: Xxxx Xxxxxxx
WITH A COPY TO:
XxXxxxxxx, Will & Xxxxx
00 Xxxxx Xxxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
Attention: Xxxxx Xxxxxxxxxxx, Esquire
35. AGENCY DISCLOSURE
Hunneman Commercial Company ("Landlord's Broker") has represented the
Landlord in this transaction, and The Columbia Group Realty Advisors, Inc.
("Tenant's Broker") has represented the Tenant in this transaction
(Landlord's Broker and Tenant's Broker are collectively referred to herein
as "Broker"), and Broker will be compensated by Landlord by separate
agreement. Landlord and Tenant (each of which is an "Indemnifying Party"
29
hereunder) represent to each other that they have dealt with no broker,
agent or finder in connection with this transaction other than Broker.
Each Indemnifying Party hereby indemnifies the other party and agrees to
hold such other party harmless from and against any and all claims,
causes, demands, losses, liabilities, fees, commissions, settlements,
judgments, damages, and expenses (including attorneys' fees and court
costs) in connection with any claim for commission, fees, compensation or
other charge relating in any way to this agreement, or to the consummation
of the transactions contemplated hereunder, which may be made by any
person, firm or entity, other than Broker, based upon any agreement made
or alleged to have been made by such Indemnifying Party or its agent or
representative, or the conduct or the alleged conduct of such Indemnifying
Party or its agent or representative. The provisions of this paragraph
shall survive termination or expiration of the Lease.
36. EXCULPATION OF LANDLORD
Landlord's obligations and liability to Tenant with respect to this Lease
shall be limited solely to Landlord's interest in the Building, and
neither Landlord nor any joint ventures (if any), partners, officers,
directors, employees or shareholders of or in Landlord shall have any
personal liability whatsoever with respect to this Lease.
37. SIGNAGE
Landlord agrees that Tenant shall be listed on the Building directory at
no cost or expense to Tenant. Tenant shall not place any signs, decals or
other materials upon the windows or suite doors of the Premises, nor on
the exterior walls of the Premises. Landlord agrees to provide Tenant, at
Landlord's expense, one building standard suite door tenant identification
sign, and one building standard floor directory identification sign.
Provided that Tenant applies for and obtains, at its expense, all required
permits, Tenant shall have the right to install the maximum signage
allowable by applicable law or variance obtained by Tenant on the exterior
of the Building, which shall include the vertical exterior banners along
Newbury Street, as well as the marquee fronting Exeter Street; Landlord
agrees to cooperate with Tenant in obtaining the permits required for such
exterior signage. No other signage is acceptable.
38. FORCE MAJEURE
Each party shall be excused from performing an obligation or undertaking
provided for in this Lease (other than the obligation of Tenant to pay any
and all items of rent as the same become due under the applicable
provisions of this Lease) so long as such performance or undertaking is
prevented, delayed, or hindered by a strike, lockout, labor dispute, civil
commotion, act of God, or any other cause outside and beyond such party's
control.
39. AUTHORITY
If Tenant is a corporation, each individual executing this Lease on behalf
of said corporation represents and warrants that he is duly authorized to
execute and deliver this Lease on behalf of said corporation, in
accordance with the bylaws and resolutions of said corporation, and that
this Lease is binding upon said corporation. If Tenant is a partnership,
each individual executing this Lease on behalf of such partnership
represents and warrants that he is duly authorized to execute and deliver
this Lease on behalf of the partnership, and that this Lease is binding on
the partnership. The submission or delivery of this document for
examination and review does not constitute an option, an offer to lease
space in the Building or an agreement to lease. This document shall have
no binding effect on the parties unless and until executed by both
Landlord and Tenant.
40. DEFINITIONS
"Landlord" as used in this Lease shall include the first party named in
this Lease, and its representatives, assigns and successors in title to
Premises. "Tenant" shall include the second party named in this Lease, and
his, hers or its heirs and representatives, and if this Lease shall be
validly assigned or sublet, shall include also Tenant's assignees or
subtenants, as to Premises covered by such assignment or sublease.
30
41. RULES AND REGULATIONS
The current rules and regulations for the Building are attached hereto as
Exhibit "E," and are incorporated herein by this reference. Additionally,
Landlord may hereafter, from time to time, adopt and promulgate such
additional rules and regulations for the government and management of said
Building as Landlord may reasonably determine to be necessary (all such
existing and future rules and regulations are collectively referred to as
the "Rules"). During the Term of this Lease, Tenant shall at all times
comply with the Rules and shall ensure compliance with the Rules by
Tenant's employees, agents and contractors. Provided, however, that Tenant
shall not be required to comply with any Rules adopted after the Effective
Date of this Lease which materially impair the rights of Tenant under this
Lease or increase the cost to Tenant of exercising its rights under this
Lease. In the event of any conflict between the terms of this Lease and
the Rules and Regulations, as the same may exist from time to time, the
terms of this Lease shall control. Subject to the foregoing, Landlord
shall enforce the Rules against all tenants of the Building uniformly, in
a non-discriminatory manner.
42. GUARANTY
[TEXT INTENTIONALLY DELETED]
43. SPECIAL STIPULATIONS
Insofar as the following stipulations conflict with any of the foregoing
provisions, the following shall control: See Addendum of Special
Stipulations attached hereto and by reference incorporated herein.
44. DEMOLITION
[TEXT INTENTIONALLY DELETED.]
45. ENTIRE AGREEMENT
This Lease, including any attachments made a part hereof, contains the
entire agreement of the parties and no representations, inducements,
promises or agreements, oral or otherwise, between the parties not
embodied herein shall be of any force or effect. The failure of either
party to exercise any power given such party hereunder, or to insist upon
strict compliance by the other party of any obligation hereunder, and no
custom or practice of the parties at variance with the terms hereof, shall
constitute a waiver of such provision or of the right to demand exact
compliance with the terms hereof.
[SIGNATURES APPEAR ON NEXT PAGE]
31
IN WITNESS WHEREOF, the parties have hereunto set their hands and seals, the day
and year first above written.
TENANT:
XXXX XXXXX' IDEALAB!,
a California corporation
By:
[SIGNATURE]
Typed Name:
Title:
[PRESIDENT OR VICE PRESIDENT]
Attest:
[SIGNATURE]
Typed Name:
Title:
[CORPORATE SECRETARY OR ASSISTANT SECRETARY]
[CORPORATE SEAL]
LANDLORD:
EASTWEST PROPERTY FUND, L.P.,
a Georgia limited partnership
BY: EASTWEST PROPERTY FUND MANAGEMENT, LLC,
a Georgia limited liability company, general partner
By: TMW Real Estate Management, Inc.,
a Georgia corporation, its authorized agent
By:
Xxxxx X. Xxxxxx, Vice President
32
ADDENDUM OF SPECIAL STIPULATIONS
1. PARKING. If TGI Friday's, an existing tenant of the Building, does not
renew its lease in the Building, Landlord shall then offer to Tenant two
(2) parking spaces adjacent to the Building. Tenant shall pay rent for
such spaces at the then market rate for monthly parking contracts for the
Newbury/Boylston Street area. Additionally, in the event that the premises
leased by TGI Friday's become available during the initial Term of this
Lease, and in the event that Tenant exercises its Right of First Offer, as
defined below, as to TGI Friday's premises, then Landlord shall offer
Tenant the remaining parking spaces adjacent to the Building at the then
market rate for monthly parking contracts in the Newbury/Boylston Street
area.
2. RIGHT OF FIRST OFFER.
(a) GRANT OF RIGHT OF FIRST OFFER. So long as this Lease is in full
force and effect, and so long as Tenant is not in default in the
performance of its covenants under the Lease beyond any applicable
notice, grace or cure period, either at the time of exercise of the
right set forth herein or on the date the "Option Space," as
hereinafter defined, is to become a part of the Premises, Tenant
shall have the right of first offer (the "Right of First Offer") to
lease any space in the Building that becomes available during the
term of the Right of First Offer, subject to all of the terms and
conditions set forth herein. Tenant's Right of First Offer shall be
subject and subordinate to the right of the existing tenant of the
Option Space to renew the term of its lease for such space, and to
any other rights of any other parties to lease all or any portion of
such available space, if such rights have already been granted in
writing prior to the Effective Date hereof. A Schedule of Lease
Expiration Dates and Renewal Options which sets forth the existing
rights of other tenants in the Building to which the Right of First
Offer is subordinate is attached hereto as Exhibit "F."
(b) TERM OF THE RIGHT OF FIRST OFFER. The term of the Right of First
Offer (the "Option Term") shall commence on the Effective Date of
this Lease, and shall expire on the earlier of (i) six (6) months
prior to the expiration of the Term of the Lease, as the same may be
extended by the written agreement of the parties from time to time,
or (ii) the first date on which all space in the Building has either
been leased by Tenant or has been presented to Tenant as "Option
Space," as defined below, and as to which Tenant's Right of First
Offer has been terminated, as provided below.
(c) AVAILABILITY OF THE OPTION SPACE. If Landlord becomes aware that any
space in the Building is or will become available to be leased by a
third party during the Option Term, then prior to making such space
available to be leased by a third party, Landlord shall forward
written notice of the availability of such space (the "Notice of
Availability") to Tenant in accordance with the notices provision of
this Lease; the Notice of Availability shall specify the location of
the space that is or will become available (the "Option Space").
1
(d) RENT APPLICABLE TO THE OPTION SPACE. Landlord shall include in its
Notice of Availability the terms and conditions it would find
acceptable for the leasing of the Option Space by Tenant.
Specifically, Landlord shall specify the Base Rental and all
Additional Rental that would be applicable to the Option Space (the
"Option Space Rent"), and the date on which Landlord anticipates
that the Option Space would be available for Tenant's occupancy,
which date shall not be sooner than sixty (60) days following
Tenant's receipt of the Notice of Availability. The Option Space
Rent shall be determined by Landlord, and shall consist of
Landlord's good faith determination of prevailing market rent for
the Option Space at the time the Option Space would become a part of
the Premises, taking into consideration such factors as rental for
comparable premises in the Building; rental for comparable premises
in existing buildings in the same geographical area as the Building
(taking into consideration, but not limited to, use, quality, age
and location of the applicable building); the rentable area of the
premises being leased; the length of the pertinent rental term;
improvement allowances, rent credits, moving allowances, space
planning allowances or similar inducements, if any, then being
offered in the market place; and the quality and creditworthiness of
the tenant, and such other factors as Landlord may reasonably
determine are relevant.
(e) EXERCISE OF THE RIGHT OF FIRST OFFER. In the event that Tenant
elects to exercise the Right of First Offer, Tenant shall provide
Landlord with notice of its intent to lease the Option Space in
accordance with the terms and conditions set forth in Landlord's
Notice of Availability, by providing Landlord with written notice of
such intent (Tenant's "Notice of Intent") no later than ten (10)
business days after Tenant's receipt of Landlord's Notice of
Availability. If Tenant does not provide its Notice of Intent to
lease the Option Space within such time period, then Tenant shall be
deemed to have elected not to exercise the Right of First Offer as
to the Option Space; the Right of First Offer shall terminate as to
the Option Space; and Landlord shall thereafter be entitled to
market and lease the Option Space to any prospective tenant upon
such terms and conditions as Landlord may deem appropriate.
(f) ARBITRATION NOTICE. If Tenant elects to exercise the Right of First
Offer, but Tenant disputes Landlord's determination of the Option
Space Rent, then Tenant shall have the option of proceeding with the
binding arbitration procedure for determining the Option Space Rent
set forth below by delivering written notice of such election, in
accordance with the notices provision of this Lease (the
"Arbitration Notice"), to Landlord contemporaneously with Tenant's
delivery to Landlord of its Notice of Intent. Tenant's election to
proceed with arbitration as set forth herein to determine the Option
Space Rent shall not delay the date on which the Option Space is to
become a part of the Premises as set forth in Landlord's Notice of
Availability.
(g) ARBITRATION. If Tenant elects to proceed with arbitration, then the
Option Space Rent shall be determined in accordance with the
procedure set forth in this paragraph ("Arbitration").
(1) APPOINTMENT OF BROKERS. Within fifteen (15) days after
Landlord's receipt of Tenant's Arbitration Notice, Landlord
and Tenant shall forward written notices to each other, in
accordance with the notices provision of this
2
Lease, in which each party shall select a real estate broker
with the qualifications set forth below. The expenses of the
initial two brokers shall be paid by the party appointing such
broker, and the expenses of the third broker, if a third
broker is appointed as provided below, shall be shared equally
by the parties. Each real estate broker selected for
Arbitration (i) must be an independent and licensed real
estate broker in the jurisdiction where the Premises are
located; (ii) must have a minimum of ten (10) years'
experience in commercial office leasing in the jurisdiction
where the Premises are located; (iii) must be an active broker
in the jurisdiction where the Premises are located and known
for commercial office expertise; (iv) must have experience
representing both landlords and tenants; (v) in the case of
the third broker only, is not then representing either
Landlord or Tenant; and (vi) in the case of the third broker
only, shall not have been involved in any disputes with
Landlord, Tenant or either of the other brokers.
(2) DETERMINATION OF OPTION SPACE RENT. Within twenty (20) days
after their selection, the brokers selected by Landlord and
Tenant shall deliver to each other their separate written
determinations of the Option Space Rent, based on the
prevailing market base rental and additional rental rate for
comparable leases for comparable premises located in the same
geographical area and market as the Building. If the separate
determinations of the Option Space Rent made by the brokers
vary by five percent (5%) or less, then the Option Space Rent
shall be determined by averaging such separate determinations.
If, however, such separate determinations vary by more than
five percent (5%), then, within fifteen (15) days following
the brokers' exchange of their separate determinations of the
Option Space Rent, a third broker having the qualifications
set forth above shall be selected by the initial two brokers.
During the fifteen (15) days following the selection of the
third broker, such broker shall in good faith review the
separate determinations made by the initial two brokers and
within such fifteen (15) day period, such broker shall select
the determination of the Option Space Rent made by one of the
initial two brokers as the Option Space Rent that will be
applicable. When the Arbitration process set forth in this
paragraph has been completed, the brokers shall notify both
Landlord and Tenant in writing of their determination of the
Option Space Rent, which determination shall be binding on
Landlord and Tenant.
(3) PAYMENT OF INTERIM RENTAL. If Arbitration is invoked by
Tenant, but for whatever reason, the Arbitration process is
not completed and the Option Space Rent has not been
determined prior to the date the Option Space is to become a
part of the Premises, then Tenant shall commence paying rent
for the Option Space at the rate set forth in Landlord's
Notice of Availability until the Arbitration process is
complete and Landlord has received written notice of the
determination of the Option Space Rent made by the brokers
(the "Determination Date"); in such event, any excess rental
paid by Tenant from the date the Premises were expanded
through the Determination Date shall be credited to the
Tenant's Base Rental and Additional Rental as the same shall
thereafter become due until the entire amount of such credit
has been exhausted.
3
(h) EXPANSION OF THE PREMISES. In the event that Tenant
provides Landlord with its Notice of Intent to lease the
Option Space in the manner provided hereinabove, then,
no later than thirty (30) days following Tenant's
receipt of Landlord's Notice of Availability (or five
(5) business days following Tenant's receipt of the
"Amendment" from Landlord, as provided hereinafter,
whichever is later), Landlord and Tenant shall execute
an amendment to this Lease (the "Amendment") to be
prepared by Landlord documenting the expansion of the
Premises to include the Option Space, which shall be
subject to all existing terms of the Lease except as
specified in Landlord's Notice of Availability; the
Option Space Rent; and the date on which the Option
Space is to become a part of the Premises, as set forth
in Landlord's Notice of Availability. In the event that
Tenant elects to proceed with the Arbitration procedure
set forth herein, then the Amendment presented to Tenant
documenting the expansion of the Premises shall provide
that the rent initially applicable to the Option Space
shall be the Option Space Rent set forth in Landlord's
Notice of Availability, until the same is determined
through the Arbitration procedure, and upon completion
of the Arbitration procedure, the parties shall execute
a further amendment to this Lease documenting the amount
of the Option Space Rent as determined by Arbitration.
In the event that Tenant fails to execute the Amendment
within the time required by the terms of this paragraph,
then the Right of First Offer shall terminate as to the
Option Space, and Landlord shall thereafter be entitled
to market and lease the Option Space to any prospective
tenant upon such terms and conditions as Landlord may
deem appropriate.
(i) RIGHT OF FIRST OFFER PERSONAL TO TENANT. The parties
expressly agree that, except as set forth herein, the
Right of First Offer granted to Tenant herein shall be
"personal" to Tenant. The Right of First Offer may only
be exercised by Tenant or a Permitted Assignee of
Tenant; it may not be exercised by any assignee or
subtenant of Tenant other than a Permitted Assignee; and
it may not be exercised by Tenant if Tenant is, either
at the time that the Notice of Intent is provided by
Tenant to Landlord or at the time the Option Space is to
become a part of the Premises, negotiating with Landlord
or a potential assignee or subtenant to either assign
the Tenant's interest under the Lease or to sublet all
or a portion of the Premises to a party other than a
Permitted Assignee.
3. RENEWAL OPTION. Tenant shall have the following option to renew the Term
of this Lease:
(A) GRANT OF RENEWAL OPTION. So long as this Lease is in full force and
effect, and Tenant is not in default in the performance of any of
the covenants or terms and conditions of this Lease beyond any
applicable notice and period of cure, either at the time of the
exercise of the option set forth herein or at the commencement of
the renewal term set forth herein, Tenant is hereby granted the
option to renew the Term of this Lease (the "Renewal Option") for a
period of five (5) additional years (the "Renewal Term"), to
commence at the expiration of the Term of the Lease. The renewal of
this Lease shall be upon the same terms and conditions of this
Lease, except: (i) the Base Rental applicable during the Renewal
Term shall be determined as set forth below; (ii) Tenant shall have
no option to renew this Lease beyond the expiration of the Renewal
Term; (iii) Tenant shall not have the right to assign its renewal
rights to any subtenant of the Premises or assignee of the Lease to
a party other than a Permitted Assignee, nor may any such subtenant
or assignee exercise or enjoy the benefit of the Renewal Option; and
(iv) the leasehold improvements will be provided in their then
existing condition at the time the Renewal Term commences.
4
(b) PRELIMINARY NOTICE. If Tenant intends to exercise the Renewal
Option, Tenant shall provide Landlord with written notice, in
accordance with the notices provision of this Lease (the
"Preliminary Notice"), of such intention at least nine (9) months,
but no earlier than twelve (12) months, prior to the expiration of
the Term of the Lease. If, for whatever reason, Tenant does not
forward Preliminary Notice to Landlord, in accordance with the terms
of this paragraph, that Tenant intends to exercise the Renewal
Option, then the Renewal Option set forth herein shall expire, and
Tenant shall not thereafter have any right to exercise the Renewal
Option or otherwise acquire an interest in the Premises after the
expiration of the initial Term of this Lease.
(c) RENTAL APPLICABLE DURING RENEWAL TERM. Within thirty (30) days after
Landlord's receipt of Tenant's Preliminary Notice, Landlord shall
provide Tenant with written notice, in accordance with the notices
provision of this Lease (the "Rent Notice"), of the Base Rental that
will be applicable during the Renewal Term, and all Additional
Rental that will be owed by Tenant during the Renewal Term (the
"Renewal Term Rent"). The Renewal Term Rent shall be determined by
Landlord, and shall consist of Landlord's good faith determination
of the market rental rate for the Premises as of the commencement of
the Renewal Term, taking into consideration such factors as rental
for comparable premises in the Building; rental for comparable
premises in existing buildings in the Back Bay area (taking into
consideration, but not limited to, use, quality, age and location of
the applicable building); the rentable area of the premises being
leased; the length of the pertinent rental term; improvement
allowances, rent credits, moving allowances, space planning
allowances or similar inducements, if any, then being offered in the
market place; and the quality and creditworthiness of the tenant,
and such other factors as Landlord may reasonably determine are
relevant.
(d) RENEWAL NOTICE. If, after review of Landlord's determination of the
Renewal Term Rent, Tenant elects to exercise the Renewal Option,
then, no later than thirty (30) days after Tenant's receipt of
Landlord's Rent Notice, Tenant shall forward written notice of such
election (the "Renewal Notice") to Landlord in accordance with the
notices provision of this Lease. Tenant shall, within thirty (30)
days after presentation by Landlord, execute an amendment to this
Lease, which amendment shall reflect the extension of the Term of
the Lease through the expiration of the Renewal Term, and the
Renewal Term Rent that will be applicable during the Renewal Term.
If, after providing Landlord with Tenant's Preliminary Notice,
Tenant does not, for whatever reason, provide Landlord with the
Renewal Notice required hereunder in order to exercise the Renewal
Option, then the Renewal Option shall expire; Tenant's Preliminary
Notice shall be of no further force or effect; and it shall be as if
the Preliminary Notice had never been forwarded by Tenant to
Landlord. If, however, after Tenant forwards its Renewal Notice to
Landlord, Tenant fails to execute the amendment to the Lease as
required by the terms of this paragraph, then such failure shall
constitute a default by Tenant under the Lease, but the Term of the
Lease shall nonetheless be extended in accordance with the terms
hereof.
(e) NEGOTIATION PERIOD. If, after review of the Rent Notice, Tenant
disputes Landlord's determination of the Renewal Term Rent, Tenant
may provide Landlord with written notice, in accordance with the
notices provision of this Lease, of such dispute, and request that
the parties negotiate the amount of such
5
rent (the "Negotiation Notice"), provided that such notice shall be
forwarded to Landlord no later than thirty (30) days following
Tenant's receipt of the Rent Notice. If, after providing Landlord
with Tenant's Preliminary Notice, Tenant does not, for whatever
reason, provide Landlord with either the Renewal Notice or the
Negotiation Notice as set forth above, then the Renewal Option shall
expire as if it had never been executed; Tenant shall not thereafter
have any other or further option to renew the Term of the Lease; and
the Lease shall expire at the end of the Term. Upon Landlord's
receipt of the Negotiation Notice, Landlord and Tenant shall proceed
to negotiate in good faith for the thirty (30) days following
Landlord's receipt of the Negotiation Notice (the "Negotiation
Period") to reach an agreement as to the amount of the Renewal Term
Rent. During the Negotiation Period, the amount of the Renewal Term
Rent shall be the subject of negotiation only between the parties
hereto or their designated agents. If the parties are able to reach
an agreement as to the amount of the Renewal Term Rent during the
Negotiation Period, then the parties shall execute an amendment to
this Lease documenting the renewal of the Lease and the amount or
calculation of the Renewal Term Rent; such amendment shall be
prepared by Landlord, and Tenant shall execute same within thirty
(30) days of Landlord's presentation of same to Tenant.
(f) ARBITRATION NOTICE. If the parties are unable to agree on the amount
of the Renewal Term Rent during the Negotiation Period, then either
party shall have the option of proceeding with the arbitration
procedure for determining the Renewal Term Rent set forth below by
delivering written notice of such election, in accordance with the
notices provision of this Lease (the "Renewal Arbitration Notice"),
to the other party within fifteen (15) days after the expiration of
the Negotiation Period. If the parties failed to reach an agreement
as to the amount of the Renewal Term Rent during the Negotiation
Period, but neither party elects to forward a Renewal Arbitration
Notice to the other party within the time frame set forth above,
then the Renewal Option shall expire as if it had never been
executed; Tenant shall not thereafter have any other or further
option to renew the Term of the Lease; and the Lease shall expire at
the end of the Term.
(g) RENEWAL ARBITRATION. If either party elects to proceed with
arbitration, then the Renewal Term Rent shall be determined in
accordance with the procedure set forth in this paragraph ("Renewal
Arbitration").
(1) APPOINTMENT OF BROKERS. Within fifteen (15) days after either
party's receipt of a Renewal Arbitration Notice, Landlord and
Tenant shall forward written notices to each other, in
accordance with the notices provision of this Lease, in which
each party shall select a real estate broker with the same
qualifications required for the brokers in an arbitration of
Option Space Rent. The expenses of the initial two brokers
shall be paid by the party appointing such broker, and the
expenses of the third broker, if a third broker is appointed
as provided below, shall be shared equally by the parties.
(2) DETERMINATION OF RENEWAL TERM RENT. Within twenty (20) days
after their selection, the brokers selected by Landlord and
Tenant shall deliver to each other their separate written
determinations of the Renewal Term Rent, based on the
prevailing market base rental and additional rental
6
rate for comparable renewal terms of leases for comparable
premises located in the same geographical area and market as
the Building. If the separate determinations of the Renewal
Term Rent made by the brokers vary by five percent (5%) or
less, then the Renewal Term Rent shall be determined by
averaging such separate determinations. If, however, such
separate determinations vary by more than five percent (5%),
then, within fifteen (15) days following the brokers' exchange
of their separate determinations of the Renewal Term Rent, a
third broker having the qualifications set forth above shall
be selected by the initial two brokers. During the fifteen
(15) days following the selection of the third broker, such
broker shall in good faith review the separate determinations
made by the initial two brokers and within such fifteen (15)
day period, such broker shall select the determination of the
Renewal Term Rent made by one of the initial two brokers as
the Renewal Term Rent that will be applicable during the
Renewal Term of this Lease. When the Renewal Arbitration
process set forth in this paragraph has been completed, the
brokers shall notify both Landlord and Tenant in writing of
their determination of the Renewal Term Rent, which
determination shall be binding on Landlord and Tenant.
Following the determination of the Renewal Term Rent, the
parties shall execute an amendment to this Lease documenting
the renewal of the Lease and the amount or calculation of the
Renewal Term Rent; such amendment shall be prepared by
Landlord, and Tenant shall execute same within thirty (30)
days of Landlord's presentation of same to Tenant.
(3) PAYMENT OF INTERIM RENTAL. If Renewal Arbitration is invoked
by either party, but for whatever reason, the Renewal
Arbitration process is not completed and the Renewal Term Rent
has not been determined prior to the scheduled commencement of
the Renewal Term, then Tenant shall continue to pay rent for
the Premises at the rate in effect during the last month of
the Term until the Renewal Arbitration process is complete and
Landlord has received written notice of the determination of
the Renewal Term Rent made by the brokers (the "Determination
Date"); in such event, any deficiency between the Renewal Term
Rent owed by Tenant from the commencement of the Renewal Term
through the Determination Date and the amount of rent actually
paid by Tenant for such period shall be calculated by
Landlord, and Tenant shall pay such deficiency within thirty
(30) days after Tenant's receipt of Landlord's statement
therefor forwarded to Tenant in accordance with the notices
provision of this Lease.
(h) RENEWAL OPTION PERSONAL TO TENANT. The parties expressly agree that,
except as set forth herein, the Renewal Option granted to Tenant
herein shall be "personal" to Tenant. The Renewal Option may only be
exercised by Tenant or a Permitted Assignee of Tenant; it may not be
exercised by any assignee or subtenant of Tenant other than a
Permitted Assignee; and it may not be exercised by Tenant if Tenant
is, at the time that the Renewal Notice is provided by Tenant to
Landlord, negotiating with Landlord or a potential assignee or
subtenant to either assign the Tenant's interest under the Lease or
to sublet all or a portion of the Premises to a party other than a
Permitted Assignee.
7
EXHIBIT A
FLOOR PLAN OF PREMISES
[TO BE ATTACHED BY LANDLORD PRIOR TO LEASE EXECUTION]
8
EXHIBIT B
DESCRIPTION OF PROPERTY ON WHICH THE PROJECT IS SITUATED
A certain parcel of land with the buildings thereon situated and now numbered 26
on Exeter Street in Boston, Suffolk County, Massachusetts, and bounded and
described as follows:
Southerly: By Newbury Street, 110 feet
Easterly: By a line parallel with and 418 feet west of the westerly line of
Dartmouth Street, 112 feet
Northerly: By a passageway 16 feet wide, 110 feet and
Westerly: By a line parallel with and 528 feet west of the westerly line of
Dartmouth Street, 112 feet
Said parcel is shown on a plan entitled "Plan of Land - Boston, Massachusetts -
Surveyed for a Xxxxx Xxxxxx and Xxxxxxxx Xxxxxx, Trs. First Spiritual Temple"
dated March 7, 1974, by Xxxx & Xxxxx, Inc., Surveyors, and recorded with Suffolk
deeds in Book 8696, Page 28, on which plan the westerly boundary is shown as
bounding on Exeter Street and the northerly boundary as bounding on Public Alley
No. 434.
9
EXHIBIT C
PLANS AND SPECIFICATIONS FOR
IMPROVEMENTS TO PREMISES
IMPROVEMENTS TO PREMISES. Tenant accepts the Premises in their existing "as is"
condition, and Landlord shall have no obligation to make any improvements to the
Premises. All improvements to the Premises (the "Improvements") shall be
constructed by Tenant at Tenant's sole cost and expense, subject to Landlord's
prior approval as set forth herein.
(a) THE PLANS. Prior to constructing the Improvements, Tenant shall submit to
Landlord detailed plans and specifications (the "Plans") for construction
of the Improvements. After they have been approved by Landlord, a copy of
the Plans will be attached hereto as Exhibit "C-1" and incorporated herein
by this reference. After attachment of a copy of the Plans hereto, all
modifications requested by Tenant to the Plans ("Change Orders") must
receive the prior approval of Landlord, which approval shall not be
unreasonably withheld or delayed. Upon Landlord's approval of the Plans,
which shall not be unreasonably withheld or delayed, Tenant shall commence
construction of the Improvements in accordance with the Plans. Landlord
shall provide Tenant with either Landlord's approval, or its determination
that its approval has been withheld (including Landlord's reasons for
withholding such approval), of the Plans or any proposed Change Orders
within five (5) business days after Landlord's receipt of such Plans or
proposed Change Orders from Tenant.
(b) CONSTRUCTION OF THE IMPROVEMENTS. The Improvements shall be constructed in
a good and workmanlike manner, and in compliance with all applicable laws,
building codes and zoning restrictions. Tenant shall not commence
construction of the Improvements until Tenant has provided Landlord with a
certificate of insurance evidencing that all insurance that Tenant is
obligated to maintain under this Lease has been procured by Tenant and is
in full force and effect. Tenant shall not commence occupancy of the
Premises until a certificate of occupancy has been obtained from the
appropriate governmental authority with jurisdiction over the Premises
reflecting that the Improvements have been substantially completed, and a
copy of such certificate has been provided by Tenant to Landlord. Within
thirty (30) days after completion of the Improvements in accordance with
the Plans, Tenant shall provide Landlord with copies of lien waivers from
all contractors, subcontractors and materialmen supplying work or labor
for the Improvements. After completion of the Improvements, any
alterations or additions which Tenant may desire to make to the Premises
shall be made in strict compliance with the terms of this Lease.
10
(c) IMPROVEMENT ALLOWANCE. Within thirty (30) days following Landlord's
receipt of the lien waivers and the certificate of occupancy required by
the terms of the preceding paragraph, together with documentation
substantiating to Landlord's reasonable satisfaction Tenant's actual cost
incurred in constructing the Improvements, Landlord shall reimburse Tenant
for such cost in an amount up to, but not exceeding, an allowance of
Thirty Dollars ($30.00) per rentable square foot of the Premises, which
amount the parties hereby agree is Six Hundred Sixty-one Thousand, Five
Hundred Sixty Dollars ($661,560.00) (the "Allowance"), Tenant shall be
fully liable for any cost of constructing the Improvements in excess of
the Allowance. In the event that the cost of the Improvements for which
reimbursement is sought by Tenant from Landlord pursuant to this paragraph
is less than the full amount of the Allowance, then the difference between
the Allowance and the cost of the Improvements reimbursed to Tenant
hereunder shall be credited against Tenant's rental as the same becomes
due and payable hereunder until the entire amount of such credit has been
exhausted.
11
EXHIBIT D
HAZARDOUS MATERIALS LIST
12
EXHIBIT E
RULES AND REGULATIONS
1. Tenant shall not obstruct the sidewalks, entry passages, corridors, halls,
elevators or stairways, or use them for any purpose other than ingress and
egress. Tenant shall not cover or obstruct the floors, or skylights and
windows which reflect or admit light into any place in the Building in
which the Premises are located. Nothing shall be thrown by Tenant, its
agents, employees or contractors out of the windows or doors, or down the
passages of the Building. The water closets and other water apparatus shall
not be used for any purpose other than those for which they were
constructed, and no sweepings, rubbish, or other obstructing substances,
shall be thrown therein. The cost of repairing any damage resulting to any
water apparatus, or to associated systems from the misuse of same by
Tenant, its agents, employees or contractors, shall be paid by Tenant.
2. Tenant shall not inscribe, paint, or affix any advertisement or other
notice to any part of the outside or inside of the Building, except upon
the doors of the Premises. Any advertisement or other notice placed upon
the doors of the Premises shall be of such order, size and style, and at
such places as shall be designated by Landlord. Signage at the entrance of
the Premises, identifying Tenant as a tenant of the Building, will be
provided by Landlord in accordance with the signage provisions of this
Lease.
3. Tenant shall not do or permit to be done in the Premises, or bring or keep
anything therein, which shall in any way increase the rate of fire
insurance on the Building or the Property, (only artificial and fire
resistant Christmas trees and/or decorations are permitted), or obstruct or
interfere with the rights of other Tenants, or in any way injure or annoy
them, or conflict with any of the rules and ordinances of the Board of
Health. Tenant, its agents, employees and contractors shall maintain order
in the Building, shall not make or permit any improper or offensive noise
within the Premises or the Building, shall not permit any noxious or
offensive odors to permeate any of the Common Areas of the Building or
Project, and shall not interfere in any way with other tenants rights of
quiet enjoyment or the rights of quiet enjoyment of those having business
with other tenants of the Building. No rooms shall be occupied or used as
sleeping lodging apartments at any time. No part of the Building shall be
used or in any way appropriated for gambling, immoral or other unlawful
practices, and no intoxicating liquors shall be sold in said Building.
4. Tenant shall not employ any persons, other than Landlord's janitors, for
the purposes of cleaning the Premises.
5. Tenant shall strictly comply with any and all regulations set forth by
Landlord for the operation, maintenance and management of the parking areas
adjacent to the Building or buildings in which the Premises are contained.
6. No animals, birds, bicycles or other vehicles, or other obstructions, shall
be allowed in the offices, halls, corridors, elevators or elsewhere in the
Building.
EXHIBIT E
Page 1 OF 2
7. No painting shall be done, nor shall any alterations be made to any part of
the Building by erecting or changing any partitions, doors or windows, nor
shall there be any nailing, boring or screwing into the woodwork, other
than the hanging of art work, or plastering, nor shall any connection be
made to the electric wires or gas or electric fixtures, without the consent
in writing on each occasion of Landlord or its agent. Landlord requires
Tenant to monitor all installation of communications and other
non-electrical wiring to ensure that all installed wiring is of a
plenum-rated type and that all relevant building and fire codes concerning
plenum-rated wiring are maintained by the installer. All glass, locks and
trimmings in or upon the doors and windows of the Building shall be kept
whole and, when any part thereof shall be broken, the same shall be
immediately replaced or repaired and put in order, under the direction and
to the satisfaction of Landlord or its agents, and shall be left whole and
in good repair. Tenant shall not injure, overload or deface the Building,
the woodwork or the walls of the Premises.
8. A reasonable number of keys for each office within the Premises will be
furnished to Tenant without charge. No additional locks or latches shall be
put upon any door without the consent of Landlord. Tenant, at the
termination of this Lease, shall return to Landlord all keys to doors in
the Building and Premises.
9. Landlord, in all cases, reserves the right to prescribe the maximum weight,
and the location of iron safes or other heavy articles placed in the
Premises.
10. The use of burning fluid, camphor, alcohol, benzene, kerosene or anything
except gas or electricity for lighting the Premises, is prohibited. No
offensive gases or liquids are permitted in the Premises or in the
Building.
11. If Tenant desires blinds over the windows, Tenant must obtain Landlord's
consent prior to installing such blinds; they must be in installed at
Tenant's sole cost and expense; and they must be of such shape, color and
material as may be prescribed by Landlord. No awning shall be placed on the
Building.
EXHIBIT E
Page 2 of 2
EXHIBIT F
SCHEDULE OF LEASE EXPIRATION DATES AND RENEWAL OPTIONS
TENANT LEASE EXPIRATION DATE RENEWAL OPTIONS
-------------------- --------------------------- --------------------------------------------------------------
Video Express March 31, 2005 5-year option, exercisable upon 6 month's prior notice
Xxxxxxxx Xxxxx July 31, 0000 Xxxx
XXX Friday's January 31, 2006 5-year option, exercisable upon 1 year's prior notice
EXHIBIT G
CLEANING SPECIFICATIONS
[TO BE ATTACHED BY LANDLORD PRIOR TO LEASE EXECUTION]
EXHIBIT H
LETTER OF CREDIT
[Date]
[Name of Issuing Bank]
Mailing Address:
IRREVOCABLE STANDBY LETTER OF CREDIT NO.
-----------------
BENEFICIARY:
EASTWEST PROPERTY FUND, L.P.
---------------------------
---------------------------
---------------------------
GENTLEMEN:
At the request of Xxxx Xxxxx' Idealab! ("Customer"), we hereby establish
in your favor an Irrevocable Standby Letter of Credit in the sum of USD EIGHT
HUNDRED NINETY-FIVE THOUSAND ONE HUNDRED NINETY-TWO AND 00/100 (US$895,192.00),
available by your drafts at sight at our office at ____________________, Boston,
Massachusetts, effective immediately and expiring on ___________________.
Drafts must be accompanied by a statement on your letterhead and
purportedly signed by you stating that:
"The amount of the draw specified in the accompanying draft represents
funds due to the undersigned by reason of the default by Xxxx Xxxxx'
Idealab! of its obligations under a lease dated __________ between the
undersigned, as landlord, and Xxxx Xxxxx' Idealab! as tenant, which
default has continued without cure beyond the expiration of all notice
and cure periods set forth in such lease."
EXHIBIT H
Page 1 of 3
Drafts drawn hereunder may be presented by Beneficiary or its authorized
representative and must be marked: "Draw under [issuing bank] Letter of Credit
number_______", and must be accompanied by the original of this Letter of Credit
and all amendments (if any). Multiple draws are permitted under this Letter of
Credit. All drafts shall be paid in the form of a cashier's check in the full
amount of the draft (but not in the aggregate in excess of the applicable limit
of this Letter of Credit), made payable to the Beneficiary at the following
address:
Eastwest Property Fund, L.P.
c/o TMW Real Estate Management, Inc.
Xxxxx 000
Xxx Xxxxxxx Xxxxx
Xxxxxxx, Xxxxxxx 00000
Attention: Director of Asset Management.
In the event that the Beneficiary would prefer that such payment be made to the
Beneficiary in another form or at another address, the Beneficiary shall so
state in the draft.
We hereby agree with the drawers, endorsers and bonafide holders of all
drafts drawn under and in compliance with the terms of this Letter of Credit,
that such drafts will be duly honored upon presentation to the drawee on or
before [initial expiration date of Letter of Credit] or any subsequent
expiration date as herein provided.
This Letter of Credit sets forth in full the terms of our undertaking and
such undertaking shall not in any way be modified or amended by reference to any
other documents whatsoever.
This Letter of Credit is subject to ISP 98 (International Standby
Practices) Publication No. 590.
You may transfer your rights under this Letter of Credit in its entirety
(but not in part) to any successor beneficiary, and such transferred rights may
be successively transferred. Transfers of this Letter of Credit shall be
effected upon presentation to [issuing bank] of the original of this Letter of
Credit and all amendments (if any), accompanied by the completed transfer form
attached hereto as Annex A [attach issuing bank's form of transfer form] and
payment of our transfer fee [state amount].
This Letter of Credit shall be deemed to be automatically extend without
amendment for an additional one (1) year term from the present or any future
expiration date hereof, unless at least thirty (30) days prior to the present or
any future expiration date hereof we notify you in writing by overnight courier
service, with receipted delivery, that we elect not to consider this Letter of
Credit renewed for any such additional period. Such notice shall be given to you
at the address set forth above, or if this Letter of Credit has been transferred
in accordance with the provisions hereof, to such address as is set forth in the
amendment to this Letter of Credit reflecting such new beneficiary. If we give
to you such notice of our election not to renew this Letter of Credit, you shall
be entitled to draw hereunder in full or in part upon presentation of your
draft, accompanied by a copy of such notice (in which event you need not provide
the statement set forth above in the second paragraph of this Letter of Credit).
EXHIBIT H
Page 2 of 3
The principal amount of this Letter of Credit shall be reduced according
to the following schedule unless, not less than thirty days prior to the
effective date of the next scheduled reduction as set forth below, we receive
from you written notice, on your letterhead and purportedly signed by you, (i)
referencing this Letter of Credit, and (ii) stating (a) that a default by Xxxx
Xxxxx' Idealab! of its obligations under a lease dated __________ between you,
as landlord, and Xxxx Xxxxx' Idealab! as tenant, has occurred and is then
continuing without cure beyond the expiration of all notice and cure periods set
forth in such lease, and (b) your request that the principal amount of this
Letter of Credit not be reduced:
SCHEDULED AMOUNT OF NEW PRINCIPAL AMOUNT OF
REDUCTION DATE REDUCTION LETTER OF CREDIT
------------------- -------------- --------------------------
March __, 2001 $137,038.40 $758,153.60
March __, 2002 $137,038.40 $621,115.20
March __, 2003 $137,038.40 $484,076.80
March __, 2004 $137,038.40 $347,038.40
March __, 2005 $137,038.40 $210,000.00
This Letter of Credit will not be automatically renewed after March __, 2010.
Very truly yours,
[issuing bank]
--------------------
Authorized signature
EXHIBIT H
Page 3 of 3
