Alkermes Inc. Contracts
Sample Business Contracts
Massachusetts-Cambridge-88 Sidney Street Lease - FC 88 Sidney Inc. and Alkermes Inc.
Lease Forms
- Start a state-specific lease for the rental of commercial property. Specify the term and rent due, as well as whether the landlord or tenant is responsible for property taxes, insurance, and maintenance and repairs.
- When a tenant vacates commercial property before the lease term has expired, it may be able to rent the premises to a third party. The tenant would be the sublessor and the third party would be the sublessee. Besides preparing a sublease, both parties will want to review the provisions for assignment or subletting in the original lease agreement between the landlord and the sublessor.
- Tenants of residential property should prepare a sublease agreement if they are seeking to sublease a room or the entire apartment or house to a third party. All parties should review the original lease agreement to see if there are any restrictions on subletting or assigning the premises.
- Triple net leases are a type of commercial leases where the tenant has to pay for property taxes, insurance, utilities, and maintenance, in addition to the monthly rent.
- When renting an office space, tenants should understand the amount of the rent and duration of the lease. Other important terms include whether the space can be subleased, which parties are responsible for maintenance, and whether any furniture and furnishings will be provided.
LEASE
88 Sidney Street
Cambridge, Massachusetts
LANDLORD
================================================================================
FC 88 SIDNEY, INC.
TENANT
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ALKERMES, INC.
Dated: October 26, 2000
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TABLE OF CONTENTS
Page
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ARTICLE 1
RECITALS AND DEFINITIONS......................................................1
Section 1.1 Recitals.....................................................1
Section 1.2 Definitions..................................................1
ARTICLE 2
PREMISES AND TERM.............................................................3
Section 2.1 Premises.....................................................3
Section 2.2 Appurtenant Rights...........................................3
Section 2.3 Landlord's Reservations......................................4
Section 2.4 Parking Passes...............................................5
Section 2.5 Commencement Date; Scheduled Rent Commencement Date; Rent
Commencement Date............................................5
Section 2.6 Extension Options............................................6
Section 2.7 Termination Rights for Failure of Conditions.................8
ARTICLE 3
RENT AND OTHER PAYMENTS......................................................10
Section 3.1 Annual Fixed Rent...........................................10
Section 3.2 Real Estate Taxes...........................................10
Section 3.3 Operating Expenses..........................................12
Section 3.4 Utility Charges.............................................15
Section 3.5 Above-standard Services.....................................15
Section 3.6 No Offsets..................................................16
ARTICLE 4
ALTERATIONS..................................................................16
Section 4.1 Consent Required for Tenant's Alterations...................16
Section 4.2 Ownership of Alterations....................................17
Section 4.3 Construction Requirements for Alterations...................18
Section 4.4 Payment for Tenant Alterations..............................19
ARTICLE 5
RESPONSIBILITY FOR CONDITION OF BUILDING AND PREMISES........................19
Section 5.1 Maintenance of Building and Common Areas by Landlord........19
Section 5.2 Maintenance of Premises by Tenant...........................20
Section 5.3 Tenant-Provided Services....................................20
Section 5.4 Delays in Landlord's Services...............................20
Section 5.5 Tenant's Responsibilities Regarding Hazardous Materials.....21
Section 5.6 Landlord's Responsibilities Regarding Hazardous Materials...22
(i)
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Page
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Section 5.7 Cross Indemnification.......................................22
ARTICLE 6
TENANT COVENANTS.............................................................23
Section 6.1 Permitted Uses..............................................23
Section 6.2 Laws and Regulations........................................23
Section 6.3 Rules and Regulations; Signs................................23
Section 6.4 Safety Compliance...........................................24
Section 6.5 Landlord's Entry............................................24
Section 6.6 Floor Load..................................................24
Section 6.7 Personal Property Tax.......................................24
Section 6.8 Assignment and Subleases....................................25
ARTICLE 7
INDEMNITY AND INSURANCE......................................................28
Section 7.1 Indemnity...................................................28
Section 7.2 Liability Insurance.........................................28
Section 7.3 Personal Property at Risk...................................29
Section 7.4 Landlord's Insurance........................................29
Section 7.5 Waiver of Subrogation.......................................29
Section 7.6 Policy Requirements.........................................30
ARTICLE 8
CASUALTY AND EMINENT DOMAIN..................................................30
Section 8.1 Restoration Following Casualties............................30
Section 8.2 Landlord's Termination Election.............................31
Section 8.3 Tenant's Termination Elections..............................31
Section 8.4 Casualty at Expiration of Lease.............................32
Section 8.5 Eminent Domain..............................................32
Section 8.6 Rent After Casualty or Taking...............................32
Section 8.7 Temporary Taking............................................32
Section 8.8 Taking Award................................................33
Section 8.9 Casualty or Eminent Domain Affecting Parking Privileges.....33
ARTICLE 9
DEFAULT......................................................................34
Section 9.1 Tenant's Default............................................34
Section 9.2 Damages.....................................................35
Section 9.3 Cumulative Rights...........................................36
Section 9.4 Landlord's Self-help........................................36
Section 9.5 Enforcement Expenses; Litigation............................36
Section 9.6 Late Charges; Interest on Overdue Payments..................37
Section 9.7 Landlord's Right to Notice and Cure; Tenant's Self-Help
Rights......................................................37
(ii)
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ARTICLE 10
MORTGAGEES' AND GROUND LESSORS' RIGHTS.......................................38
Section 10.1 Subordination...............................................38
Section 10.2 Prepayment of Rent not to Bind Mortgagee or Ground Lessor...38
Section 10.3 Tenant's Duty to Notify Mortgagee and Ground Lessor;
Mortgagee's and Ground Lessor's Ability to Cure.............38
Section 10.4 Estoppel Certificates.......................................38
Section 10.5 Subordination, Nondisturbance and Attornment Agreements.....40
ARTICLE 11
SECURITY DEPOSIT.............................................................40
ARTICLE 12
MISCELLANEOUS................................................................42
Section 12.1 Notice of Lease.............................................42
Section 12.2 Notices.....................................................42
Section 12.3 Successors and Limitation on Liability......................43
Section 12.4 Waivers.....................................................43
Section 12.5 Acceptance of Partial Payments of Rent......................43
Section 12.6 Interpretation and Partial Invalidity.......................43
Section 12.7 Quiet Enjoyment.............................................44
Section 12.8 Brokerage...................................................44
Section 12.9 Surrender of Premises and Holding Over......................44
Section 12.10 Ground Lease................................................45
Section 12.11 Financial Reporting.........................................45
Section 12.12 Cambridge Employment Plan...................................45
Section 12.13 Truck Delivery Routes; Traffic Mitigation Measures..........46
Section 12.14 Parking and Transportation Demand Management................46
Section 12.15 Laboratory Animals..........................................46
Section 12.16 No Consequential Damages....................................46
Section 12.17 Governing Law...............................................46
EXHIBIT A - Basic Lease Terms
EXHIBIT B - Legal Description
EXHIBIT B-1 - Depiction of Premises
EXHIBIT B-2 - Map of University Park
EXHIBIT C - Work Letter
EXHIBIT D - Standard Services
EXHIBIT E - Rules and Regulations
EXHIBIT F - Measurement Method
EXHIBIT G - Form of MIT Non-Disturbance Agreement
EXHIBIT H - Intentionally Omitted
(iii)
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EXHIBIT I - Expedited Dispute Resolution Procedure
EXHIBIT J - Tenant Removable Equipment
(iv)
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LEASE
ARTICLE 1
RECITALS AND DEFINITIONS
Section 1.1 RECITALS. This Lease (this "Lease") is entered into this 26th
day of October, 2000 by and between FC 88 Sidney, Inc. (the "Landlord"), a
Massachusetts corporation, and Alkermes, Inc. (the "Tenant"), a Pennsylvania
corporation.
In consideration of the mutual covenants herein set forth, the Landlord and
the Tenant do hereby agree to the terms and conditions set forth in this Lease.
Section 1.2 DEFINITIONS. The following terms shall have the meanings
indicated or referred to below:
"Additional Rent" means all charges payable by the Tenant pursuant to this
Lease other than Annual Fixed Rent, including without implied limitation the
Tenant's parking charges as provided in Section 2.4; the Tenant's Tax Expense
Allocable to the Premises as provided in Section 3.2; the Tenant's Operating
Expenses Allocable to the Premises in accordance with Section 3.3; amounts
payable to Landlord for separately submetered utilities and services pursuant to
Section 3.4; amounts payable for special services pursuant to Section 3.5; costs
for alterations or additions to the Premises exceeding the Tenant's Allowance
(as described in the Work Letter); and the Landlord's share of any sublease or
assignment proceeds pursuant to Section 6.8.
"Annual Fixed Rent" - See EXHIBIT A, and Section 3.1.
"Base Building Improvements" - See the Work Letter.
"Building" means the building to be constructed in accordance with the Work
Letter and located at 88 Sidney Street, Cambridge, Massachusetts.
"Commencement Date" - See Section 2.5.
"Common Areas" - see Section 2.2.
"Declaration of Covenants" means that certain Declaration of Covenants
dated as of December 15, 1997 made by Massachusetts Institute of Technology, as
declarant, recorded on March 12, 1998 in the Middlesex South Registry of Deeds
as Instrument No. 1065 and filed on March 12, 1998 in the Middlesex South
Registry District of the Land Court as Document No. 1058425.
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"Default Interest Rate" - see Section 9.6.
"Estimated Rent Commencement Date" - See EXHIBIT A.
"Expedited Dispute Resolution Procedure" means the dispute resolution
procedure described in EXHIBIT I.
"Extension Term" - See Section 2.6.
"Excusable Delay" - See the Work Letter.
"External Causes" means, when referring to a party's responsibilities under
this Lease, collectively Acts of God, war, civil commotion, fire, flood or other
casualty, strikes or other extraordinary labor difficulties or shortages of
labor or materials or equipment in the ordinary course of trade, extraordinary
weather conditions, government order or regulations or other cause not
reasonably within the control of such party, and not due to the fault or neglect
of such party. In no event shall financial inability be deemed to be an External
Cause.
"Garage" - See EXHIBIT A.
"Initial Leasehold Improvements" means the initial alterations and
additions which Tenant is undertaking pursuant to the Work Letter.
"Initial Term" - See EXHIBIT A.
"Land" means the parcel of land situated in Cambridge, Massachusetts,
described in EXHIBIT B.
"Landlord's Original Address" - See EXHIBIT A.
"Landlord's Work" means the Landlord's construction of the Base Building
Improvements in accordance with the Work Letter.
"Lease Year" means each period of one year during the Term commencing on
the Rent Commencement Date or on any anniversary thereof.
"Market Rate Parking Charge" means the monthly parking rate for structured
parking facilities charged from time to time by owners of parking facilities of
similar age and quality, providing similar convenience and proximity to the work
environment, and similar services and amenities, in the geographical area in
which the Garage is located. As of the date hereof, parking facilities most
similar to the Garage are the parking facilities of Cambridge Center, Technology
Square and One Kendall Square.
"Parking Passes" - See EXHIBIT A.
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"Permitted Uses" - See EXHIBIT A.
"Premises" means the entire rentable area of the Building. See EXHIBIT A
and Sections 2.1 and 2.3.
"Property" means the Land and the Building.
"Removable Alterations" - See Section 4.2.
"Rent Commencement Date" - See Section 2.5.
"Rules and Regulations" - See Section 6.3.
"Substantial Completion" - See the Work Letter.
"Tenant's Original Address" - See EXHIBIT A.
"Term" means the Initial Term together with any Extension Term for which an
extension option is timely exercised by the Tenant under Section 2.6.
"Termination Date" - See EXHIBIT A.
"University Park" means the area in Cambridge, Massachusetts, bounded on
the North side by Massachusetts Avenue, Green and Blanche Streets, on the East
side by Landsdowne, Cross and Purrington Streets, on the South side by Pacific
Street and on the West side by Brookline Street, as shown on EXHIBIT B-2.
"Work Letter" means the letter agreement of even date herewith between the
Landlord and Tenant relating to the construction of the Building and the
leasehold improvements in the Premises attached hereto and made a part hereof as
EXHIBIT C. The Work Letter is incorporated by reference and shall be deemed to
be a part of this Lease.
ARTICLE 2
PREMISES AND TERM
Section 2.1 PREMISES. The Landlord hereby leases to the Tenant, and the
Tenant hereby leases from the Landlord, for the Term, the Premises, which shall
be comprised of the space illustrated on EXHIBIT B-1, the rentable square foot
calculation of which shall be determined in accordance with EXHIBIT A and the
methodology set forth in EXHIBIT F, subject to the Landlord's reservations set
forth in Section 2.3, such easements, covenants and restrictions as may affect
the Property and the terms and conditions of this Lease. The Tenant acknowledges
that, except as expressly set forth in this Lease, there have been no
representations or warranties
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made by or on behalf of the Landlord with respect to the Premises, the Building
or the Property or with respect to the suitability of any of them for the
conduct of the Tenant's business.
Section 2.2 APPURTENANT RIGHTS.
(a) The Tenant shall have, as appurtenant to the Premises, the
nonexclusive right to use in common with others, subject to the Rules and
Regulations, the common walkways and driveways situated upon the Land that are
necessary or reasonably convenient for access to the Building, and all other
areas in and amenities of University Park as are made available generally to the
occupants of University Park or the general public (collectively, the "Common
Areas").
(b) The Tenant shall have, as appurtenant to the Premises (and
exclusively for use in connection with the occupancy of the Premises), the
exclusive right of access to and use of the roof (in common with Landlord but
subject to Section 2.3(b)) for the purpose of installing and maintaining
mechanical equipment, antennae and dishes which, in each case, have been
pre-approved by the Landlord as part of the Initial Leasehold Improvements or as
otherwise approved by the Landlord under Article 4, subject however, to
reasonable rules and regulations from time to time made by the Landlord of which
the Tenant is given notice.
(c) The Tenant shall have, as appurtenant to the Premises, the
right to enjoy such easements of ingress and egress over other land within
University Park as may benefit the Property as more particularly contemplated
under the Declaration of Covenants.
(d) The Tenant shall have, as appurtenant to the Premises, the
parking rights set forth in Section 2.4.
Section 2.3 LANDLORD'S RESERVATIONS.
(a) RESERVED COMMON AREA RIGHTS. The Landlord reserves the
right from time to time, without unreasonable interference with the
Tenant's use to alter or modify the Common Areas, provided that (i) the
Landlord gives the Tenant reasonable advance notice of the Landlord's
contemplated alterations or modifications, with respect to which the
Tenant shall have reasonable approvals rights, (ii) any such actions
are effected in a good and workmanlike manner at no additional cost to
Tenant (other than improvements thereto the costs of which are shared
by tenants in University Park pursuant to the Declaration of
Covenants), and (iii) such alterations or modifications do not impair
Tenant's access to the Premises or its practical use and enjoyment
thereof or of the Common Areas.
(b) RESERVED ROOF RIGHTS. The Landlord reserves the right from
time to time, without unreasonable interference with the Tenant's use,
to access, install, use, maintain, repair, replace and relocate
mechanical and communications equipment on the roof of the Building and
any mechanical penthouse areas thereon, and any related conduits, wires
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and appurtenant fixtures and equipment ("Landlord Reserved Roof
Rights"), provided that the Landlord agrees that the exercise of
Landlord's Reserved Roof Rights shall not be permitted to impair the
Tenant's conduct of business operations in the Premises including,
without limitation, the communication with off-premises locations of
the Tenant or its affiliates. The Tenant acknowledges that the Tenant's
right to make installations, improvements and alterations upon the roof
of the Building, in addition to being limited by Article 4 of this
Lease, shall be restricted to mechanical equipment serving the
Premises, and antennae, satellite dishes or other communications
equipment that serves exclusively the business activities conducted in
the Premises (exclusive of a communications business being conducted in
the Premises) including, without limitation, the communication with
off-premises locations of the Tenant or its affiliates.
(c) GROUND FLOOR LOBBY. Tenant hereby acknowledges that the
Landlord has an interest in the appearance and use of the ground floor
lobby of the Building notwithstanding that the Building shall be
occupied by a single tenant. The Tenant hereby agrees that visitors may
enter the front door to the lobby during normal business hours. For
purposes hereof, normal business hours shall mean Monday through Friday
from 8:00 a.m. to 5:00 p.m. Accordingly, Tenant shall not alter the
appearance of said lobby in a way contrary to the standards mutually
agreed upon by Landlord and Tenant, without Landlord's prior written
consent which shall not be unreasonably withheld, conditioned or
delayed; provided that such consent shall be deemed given if not denied
by Landlord within ten (10) business days of a request therefor and if
still not denied within five (5) business days of a written reminder
notice, which reminder notice shall state the "deemed approval"
consequences of failure to respond.
Section 2.4 PARKING PASSES. The Landlord shall provide and the Tenant shall
pay for Parking Passes (as defined in EXHIBIT A) for use by the Tenant's
employees in accordance with EXHIBIT A. Charges for the Tenant's parking
privileges hereunder shall be determined in accordance with EXHIBIT A, shall
constitute Additional Rent and shall be payable monthly to the Landlord, during
the Term, from and after the Rent Commencement Date. The Tenant agrees that it
and all persons claiming by, through and under it, shall at all times abide by
the Rules and Regulations set forth on EXHIBIT E and any other rules and
regulations promulgated by the Landlord in accordance with Section 6.3, of which
the Tenant is given written notice, with respect to the use of the parking
facilities provided by the Landlord pursuant to this Lease. The Landlord
acknowledges that it is the Landlord's responsibility to assure that holders of
Parking Passes who fulfill the requirements of the Rules and Regulations are
able to park their motor vehicles in the designated parking facilities.
At the option of the Landlord, the Tenant shall enter into a separate
agreement, with the Landlord or a separate entity, or the Landlord may assign
the Landlord's rights and obligations with respect to such parking privileges to
a separate entity, upon the same terms and conditions contained in this Lease
(and cross-defaulted, both as to the Landlord's and Tenant's obligations, with
this Lease) for a period which shall have the same expiration date as the Term
and which, if
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this Lease provides for options on the part of the Tenant to extend, shall be
automatically extended upon the exercise of any of such options.
Section 2.5 COMMENCEMENT DATE; SCHEDULED RENT COMMENCEMENT DATE; RENT
COMMENCEMENT DATE. "Commencement Date" means the date on which the Tenant is
first provided access to any portion of the Premises for the construction of the
Initial Leasehold Improvements. "Scheduled Rent Commencement Date" shall mean
the date specified therefor in EXHIBIT A hereto. "Rent Commencement Date" shall
mean the latest of (w) the Scheduled Rent Commencement Date specified in EXHIBIT
A hereto, (x) the date thirty nine (39) weeks after the occurrence of the Steel
Frame Completion Date (as defined in the Work Letter), (y) the date twenty five
(25) weeks after the occurrence of the Building Weathertight Date (as defined in
the Work Letter) or (z) the date upon which Substantial Completion of the Base
Building Improvements occurs. Notwithstanding the foregoing (w) through (z), the
Rent Commencement Date shall be accelerated to the date upon which Tenant
commences occupancy of any portion of the Premises which, in the aggregate,
comprises twenty five percent (25%) or more of the rentable square footage
thereof for the conduct of business, provided that during any period that Tenant
so occupies any portion of the Premises prior to the Rent Commencement Date, the
Tenant shall be liable for any rental and other monetary obligations under this
Lease allocable to such portion of the Premises so occupied including, without
limitation, Annual Fixed Rent proportionate to the portion of the Premises so
occupied.
Notwithstanding the foregoing procedure for establishing the Rent
Commencement Date, the occurrence of Tenant Delay (as defined in the Work
Letter) or Landlord Delay (as defined in the Work Letter) shall have the
following effect:
(i) If the performance of the Landlord's Work is delayed as
the result of Tenant Delay, then, for the purpose of determining each
of (i) the Steel Frame Completion Date, (ii) the Building Weathertight
Date and (iii) the date upon which Substantial Completion of the Base
Building Improvements occurs, each of such conditions shall be deemed
to have been fulfilled on the date that the conditions would have
otherwise been fulfilled, but for such Tenant Delay.
(ii) If the performance of the Tenant Work is delayed as the
result of Landlord Delay with the consequence that Tenant Work that
would otherwise have been substantially completed on or before the Rent
Commencement Date cannot reasonably be substantially completed on or
before the Rent Commencement Date, then the Rent Commencement Date
shall be postponed for a period equal to the period by which the
substantial completion of such Tenant Work is so delayed, but in any
event the Rent Commencement Date shall be accelerated to any earlier
date (but not prior to the Scheduled Rent Commencement Date) upon which
Tenant commences occupancy of any Portion of the Premises for the
conduct of business.
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The Landlord and the Tenant shall, promptly following the Rent Commencement
Date, confirm in writing the Rent Commencement Date, the rentable floor area of
the Premises and the initial Annual Fixed Rent.
Section 2.6 EXTENSION OPTIONS. Provided that there has been no Event of
Default which is uncured and continuing on the part of the Tenant, and the
Tenant is, as of the date of exercise and as of the commencement date of each
Extension Term, actually occupying at least fifty percent (50%) of the Premises
for its own business purposes, the Tenant shall have the right to extend the
Term hereof for two (2) successive periods of ten (10) years each (each such
period an "Extension Term") on the following terms and conditions:
(a) Such right to extend the Term shall be exercised by the
giving of notice by Tenant to Landlord at least twelve (12) months
prior to the expiration of the Initial Term or the then current
Extension Term, as applicable (the "Extension Notice Deadline Date").
Upon the giving of such notice on or before the Extension Notice
Deadline Date, this Lease and the Term hereof shall be extended for an
additional term, as specified above, without the necessity for the
execution of any additional documents except a document memorializing
the Annual Fixed Rent for the Extension Term to be determined as set
forth below. Time shall be of the essence with respect to the Tenant's
giving notice to extend the Term on or before the Extension Notice
Deadline Date. In no event may the Tenant extend the Term under this
Section 2.6 for more than twenty (20) years after the expiration of the
Initial Term.
(b) Each Extension Term shall be upon all the terms,
conditions and provisions of this Lease, except the Annual Fixed Rent
payable during each Extension Term shall be the then Extension Fair
Rental Value of the Premises for such Extension Term, to be determined
under Section 2.6(d) or Section 2.6(e) below, but in no case less than
the Annual Fixed Rent that was applicable thereto immediately preceding
the Extension Term with respect to which the Extension Fair Rental
Value is to be established (the "Then Applicable Annual Fixed Rental
Rate"). For purposes of this Section 2.6, the "Extension Fair Rental
Value" of the Premises shall mean the then current fair market annual
rent, for leases of other space in Cambridge, Massachusetts similarly
improved, taking into account the condition to which such premises have
been improved (including any replacements of existing improvements or
performance of maintenance obligations ("Replacements"), but excluding
any capital improvements to the Premises (i.e., other than
Replacements) that enhance the value thereof, provided the same are
made by the Tenant during the sixty (60) month period immediately
preceding the applicable Extension Notice Deadline Date), and the
economic terms and conditions specified in this Lease that will be
applicable thereto.
(c) If the Tenant makes a written request to the Landlord for
a proposal for the Extension Fair Rental Value for the upcoming
Extension Term ("Tenant's Extension Rental Request") on or before the
day two (2) months prior to the Extension Notice Deadline Date, then
the Landlord shall make such a written proposal ("Landlord's
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Proposal") to the Tenant within fifteen (15) days after receipt of
Tenant's Extension Rental Request, but in no event shall the Landlord
be required to deliver such a proposal sooner than fifteen (15) months
prior to the scheduled commencement of such Extension Term. Following
delivery by the Landlord of Landlord's Proposal to the Tenant, the
parties will endeavor in good faith to reach agreement with respect to
the establishment of the Extension Fair Rental Value for the Extension
Term.
(d) Unless the parties have already mutually agreed upon such
Extension Fair Rental Value, on or before the day that is ten (10) days
prior to the applicable Extension Notice Deadline Date, the Landlord
and the Tenant shall deliver to each other their final Landlord's
Proposal (or any final change that the Landlord wishes to make to any
previously furnished Landlord's Proposal) and a written proposal from
the Tenant for the Extension Fair Rental Value of the Premises (the
"Tenant's Proposal"), as the case may be, and each of such Landlord's
Proposal and such Tenant's Proposal shall be binding on the Landlord
and the Tenant, respectively, for the purpose of conducting the
resolution procedure described in clause (e) below. Failure by the
Landlord or the Tenant to timely deliver a final Landlord's Proposal or
final Tenant's Proposal (time being of the essence), as the case may
be, shall result in the other party's proposal being deemed the
Extension Fair Rental Value, and failure by the Landlord or the Tenant
to timely make any final change to the then most recently delivered
Landlord's Proposal or Tenant's Proposal, as the case may be, shall
render no longer subject to change the last previously delivered
Landlord's Proposal or Tenant's Proposal, as the case may be, which
shall thereupon become final.
(e) If the Tenant exercises its election to extend the Term
under clause (a) above, without the Extension Fair Rental Value of the
Premises having been established by mutual agreement of the parties as
contemplated under clause (c) above, then unless a final Landlord's
Proposal and a final Tenant's Proposal has been established under
clause (d) above, the Landlord shall furnish a final Landlord's
Proposal to the Tenant, and the Tenant shall furnish a final Tenant's
Proposal to the Landlord, within thirty (30) days of the Tenant's
having exercised its election to extend the Term. Within thirty (30)
days after the later to occur of (x) the Tenant's exercise of its
election to extend the Term or (y) the establishment of a final
Landlord's Proposal and a final Tenant's Proposal in accordance with
this clause (e), unless the parties have mutually agreed upon the
identity of a real estate professional ("Arbiter") with at least ten
(10) years continuous experience in the business of appraising or
marketing similar commercial real estate in the Cambridge,
Massachusetts area who has agreed to serve as hereinafter provided (the
"Deciding Arbiter"), the Landlord and the Tenant shall each appoint an
Arbiter who shall, within thirty (30) days of selection, select a third
Arbiter to serve as the Deciding Arbiter. The Deciding Arbiter shall
select either Landlord's Proposal or Tenant's Proposal as the proposal
most accurately stating the Extension Fair Rental Value of the
Premises. If the two Arbiters respectively selected by the parties (the
"Party Selected Arbiters") cannot agree upon the selection of a
Deciding Arbiter, then such two Party Selected Arbiters shall seek the
selection of the Deciding Arbiter by the Greater Boston Real Estate
Board.
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The Deciding Arbiter shall give notice of his or her selection to the
Landlord and the Tenant and its selection of either Landlord's Proposal
or Tenant's Proposal shall be final and binding upon the Landlord and
the Tenant. Each party shall pay the fees and expenses of its real
estate professional counsel and any Party Selected Arbiter that such
party selects, if any, in connection with any proceeding under this
paragraph, and one-half of the fees and expenses of the Deciding
Arbiter. In the event that the commencement of the Extension Term
occurs prior to a final determination of the Extension Fair Rental
Value therefor (the "Extension Rent Determination Date"), then the
Tenant shall pay the Annual Fixed Rent in effect immediately preceding
the commencement of such Extension Term. If the Annual Fixed Rent for
the Extension Term is determined to be greater than the Annual Fixed
Rent paid with respect to the Premises prior to the Extension Rent
Determination Date, then the Tenant shall pay to the Landlord the
amount of such underpayment within thirty (30) days of the Expansion
Rent Determination Date.
Section 2.7 TERMINATION RIGHTS FOR FAILURE OF CONDITIONS. The effectiveness
of the Lease shall be subject to the timely satisfaction of each of the
conditions specified below, unless the satisfaction of a condition is waived or
deemed waived, on or before the deadline date specified below for the
satisfaction thereof:
(a) TENANT'S TITLE DUE DILIGENCE: that the Tenant is
reasonably satisfied, on or before the date which is ten (10) business
days following the date upon which Landlord furnishes Tenant an ALTA
leasehold title insurance commitment with respect to this Lease and a
boundary survey of the Land specifying the location of any easements or
restrictions, that there are no title or survey matters that will
materially and adversely interfere with Tenant's use of the Premises,
and the timely occupancy thereof as contemplated under this Lease, for
the Permitted Uses. The Tenant's failure to terminate this Lease under
this clause (a) on the basis of the condition herein described, on or
before such tenth (10th) business day, shall constitute a waiver by the
Tenant of such condition.
(b) CLOSING OF CONSTRUCTION LOAN: that a loan financing
construction of the Building shall have closed on or before May 1,
2001, which condition shall be for the benefit of both the Landlord and
the Tenant, and cannot be waived as a condition unless waived by both
the Landlord and the Tenant. If the construction loan is not closed on
or before May 1, 2001, this Lease may be terminated by either the
Landlord or the Tenant upon notice to such effect to the other. Failure
by either party to terminate this Lease under this clause (b) on or
before May 5, 2001 shall constitute a waiver of such condition by such
party.
(c) LENDER SUBORDINATION, NON-DISTURBANCE AND ATTORNMENT
AGREEMENT: that the Tenant has been furnished with a subordination,
non-disturbance and attornment agreement ("SNDA"), in form and
substance reasonably satisfactory to Tenant, on or before the closing
of the construction loan to which reference is made in clause (b)
above.
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Tenant agrees that the form of SNDA attached to the Lease as EXHIBIT H,
with commercially reasonable modifications required by either of the
Tenant or the Lender, shall be deemed satisfactory to the Tenant.
(d) GROUND LESSOR NON-DISTURBANCE AGREEMENT: that Tenant has
been furnished with a non-disturbance agreement in the form attached
to the Lease as EXHIBIT G, on or before the closing of the
construction loan to which reference is made in clause (b) above.
The Landlord and the Tenant each agree to exercise commercially reasonable
efforts to facilitate the satisfaction of the aforesaid conditions to their
respective obligations under this Lease. Upon any termination of this Lease
under this Section 2.7, neither party shall have any further rights or
obligations under this Lease, which shall have no further force or effect.
ARTICLE 3
RENT AND OTHER PAYMENTS
Section 3.1 ANNUAL FIXED RENT. From and after the Rent Commencement Date,
the Tenant shall pay, without notice or demand, monthly installments of
one-twelfth (1/12) of the Annual Fixed Rent in effect and applicable to the
Premises in advance for each full calendar month of the Term following the Rent
Commencement Date and of the corresponding fraction of said one-twelfth (1/12)
for any fraction of a calendar month at the Rent Commencement Date. The Annual
Fixed Rent applicable to the Premises during the Initial Term shall be as set
forth in EXHIBIT A.
Section 3.2 REAL ESTATE TAXES. From and after the Rent Commencement Date,
during the Term, the Tenant shall pay to the Landlord, as Additional Rent, the
entirety of the Landlord's Tax Expenses (as such term is hereinafter defined) in
accordance with this Section 3.2. The terms used in this Section 3.2 are defined
as follows:
(a) "Tax Fiscal Year" means the 12-month period beginning July
1 each year, or such other fiscal period in respect of which real
estate taxes are due and payable to the appropriate governmental taxing
authority.
(b) "The Landlord's Tax Expenses" with respect to any Tax
Fiscal Year means the aggregate Real Estate Taxes on the Property with
respect to that Tax Fiscal Year, reduced by any abatement receipts with
respect to that Tax Fiscal Year.
(c) "Real Estate Taxes" means (i) all taxes and special
assessments of every kind and nature assessed by any governmental
authority on the Property; (ii) reasonable expenses incurred in
connection with negotiating with the city assessor's office, in advance
of the establishment of the assessed valuation of the Property, to
establish a
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mutually agreeable assessment therefor; and (iii) reasonable expenses
incurred in connection with any proceedings for abatement of such taxes
or special assessments. Any special assessments to be included within
the definition of "Real Estate Taxes" shall be limited to the amount of
the installment (plus any interest thereon) of such special tax or
special assessment (which shall be payable over the longest period
permitted by law) required to be paid during the Tax Fiscal Year in
respect of which such taxes are being determined. There shall be
excluded from such taxes all income, estate, succession, inheritance,
excess profit, franchise and transfer taxes, all so-called linkage
payments and delinquency interest or penalties; provided, however, that
if at any time during the Term the present system of AD VALOREM
taxation of real property shall be changed so that in lieu of the whole
or any part of the ad valorem tax on real property, there shall be
assessed on the Landlord a capital levy or other tax on the gross rents
received with respect to the Property, or a federal, state, county,
municipal or other local income, franchise, excise or similar tax,
assessment, levy or charge (distinct from any now in effect) based, in
whole or in part, upon any such gross rents, then any and all of such
taxes, assessments, levies or charges, to the extent so based, shall be
deemed to be included within the term "Real Estate Taxes," based on the
Building being the Landlord's only property. Landlord hereby agrees
that it will cause the Land to constitute a separate parcel with
respect to the assessment of Real Estate Taxes.
Payments by the Tenant on account of the Landlord's Tax Expenses shall
be made monthly at the time and in the fashion herein provided for the payment
of Annual Fixed Rent and shall be in an amount of the greater of (i) one-twelfth
(1/12) of the Landlord's Tax Expenses for the current Tax Fiscal Year as
reasonably estimated by the Landlord, or (ii) an amount reasonably estimated by
any ground lessor of the Land or holder of a first mortgage on the Property, to
be sufficient, if paid monthly, to pay the Landlord's Tax Expenses on the dates
due to the taxing authority.
Not later than one hundred twenty (120) days after the Landlord's Tax
Expenses are determinable for the first Tax Fiscal Year of the Term or fraction
thereof and for each succeeding Tax Fiscal Year or fraction thereof during the
Term, the Landlord shall render the Tenant a statement in reasonable detail
showing for the preceding year or fraction thereof, as the case may be, real
estate taxes on the Property, and any abatements or refunds of such taxes,
together with a copy of the tax bill for the Tax Fiscal Year in question.
Reasonable expenses incurred in obtaining any tax abatement or refund not
previously charged may be charged against such tax abatement or refund before
the adjustments are made for the Tax Fiscal Year. If at the time such statement
is rendered it is determined with respect to any Tax Fiscal Year, that the
Tenant has paid (i) less than the Landlord's Tax Expenses or (ii) more than the
Landlord's Tax Expenses, then, in the case of (i) the Tenant shall pay to the
Landlord, as Additional Rent, within thirty (30) days of such statement the
amount of such underpayment and, in the case of (ii) the Landlord shall credit
the amount of such overpayment against the monthly installments of the
Landlord's Tax Expenses next thereafter coming due (or refund such overpayment
within thirty (30) days if the Term has expired to the extent that such
overpayment exceeds any amount then due from the Tenant to the Landlord). To the
extent that real estate taxes shall be payable to the taxing
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authority in installments with respect to periods less than a Tax Fiscal Year,
the statement to be furnished by the Landlord shall be rendered and payments
made on account of such installments. If the Rent Commencement Date occurs on
other than the first day of a Tax Fiscal Year, or if the Termination Date occurs
on other than the last day of a Tax Fiscal Year, then the amount of Landlord's
Tax Expenses payable by the Tenant with respect to such Tax Fiscal Year(s) shall
be pro-rated based upon the ratio of the length of the time period during such
Tax Fiscal Year(s) in respect of which the Tenant has an obligation to pay
Landlord's Tax Expenses to the length of such Tax Fiscal Year(s).
At the reasonable request of the Tenant, the Landlord shall use
reasonable efforts to contest or seek abatement of any Real Estate Taxes
affecting the Premises. Should the Landlord contest or seek abatement of such
taxes, then it shall do so with diligence and shall keep the Tenant
appropriately informed, in the Landlord's reasonable discretion, as to such
action. If there shall be any dispute between the Landlord and the Tenant
regarding whether or not the Landlord is being reasonable in electing not to
contest or seek abatement of any Real Estate Taxes that the Tenant desires be
contested or with respect to which the Tenant desires to seek abatement, such
dispute shall, at the election of either the Landlord or the Tenant, be resolved
by the Expedited Dispute Resolution Procedure.
Section 3.3 OPERATING EXPENSES. From and after the Rent Commencement
Date, during the Term, the Tenant shall pay to the Landlord, as Additional Rent,
the entirety of the Operating Expenses for the Property, in accordance with this
Section 3.3 including, without limitation, the conditions and limitations set
forth in clauses (a) through (k) below, with respect to each 12-month period
beginning February 1 each year or such other fiscal period of twelve (12)
consecutive months hereinafter adopted by the Landlord for lease administration
purposes ("Operating Fiscal Year"). The term "Operating Expenses for the
Property" means the Landlord's actual cost of operating, cleaning, maintaining
and repairing the Property, the roads, driveways and walkways for providing
access to the Building, and shall include without limitation, the cost of
fulfilling the maintenance and repair obligations required to be performed by
Landlord under Section 5.1 and, subject to the exclusions set forth below, the
cost of services specified on EXHIBIT D; premiums for insurance carried pursuant
to Section 7.4; the amount of any deductible associated with an insurance claim
of the Landlord; compensation including, without limitation, fringe benefits,
worker's compensation insurance premiums and payroll taxes paid to, for or with
respect to all persons (University Park/Building general manager and below)
engaged in the operating, maintaining or cleaning of the Property; interior
landscaping and maintenance; steam, water, sewer, gas, oil electricity,
telephone and other utility charges (excluding any such utility charges either
separately metered or separately chargeable to the Tenant for either measured or
additional or special services); cost of providing HVAC services other than such
services described in Section 3.4; cost of building and cleaning supplies; the
costs of routine environmental management programs operated by Landlord; market
rental costs (or alternatively the Amortization Charge-off [as hereinafter
defined] so long as the expenses which are the subject of such Amortization
Charge-off would have been permitted Operating Expenses had the item in question
been purchased) with respect to equipment used in the operating, cleaning,
maintaining or repairing of the Property; cost of cleaning; cost of
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maintenance, and non-capital repairs and replacements; cost of snow removal;
cost of landscape maintenance; security services; payments under service
contracts with independent contractors; management fees at reasonable rates
consistent with comparable single-tenant or multi-tenant buildings, as
applicable, in the Cambridge market with the type of occupancy and services
rendered (the parties agree that for the first Lease Year, this shall equal
$0.85 per rentable square foot, and shall be subject to reasonable adjustments
during subsequent Lease Years); the cost of any capital repairs, replacements or
improvements: (i) required by any law or regulation enacted or promulgated after
the issuance of a building permit for the construction of the Building, (ii)
which is required in order to maintain the Property in the condition it is
required to be kept and maintained under Section 5.1, (iii) which reduces the
Operating Expenses for the Property, or (iv) which improves the management and
operation of the Property in a manner reasonably acceptable to Tenant (all such
capital costs to be amortized on a straight-line basis in accordance with
generally accepted accounting principles, together with interest on the
unamortized balance at such rate as may have been paid by the Landlord on funds
borrowed for the purpose of making such capital repairs, replacements or
improvements (or if the Landlord did not borrow such funds, then at the base
lending rate announced by a major commercial bank designated by the Landlord),
with only the annual amortization amount ("Amortization Charge-off") being
included in Operating Expenses with respect to any Operating Fiscal Year);
charges equitably and reasonably allocated to the Building for the operating,
cleaning, maintaining, securing and repairing of the Common Areas excluding the
initial capital improvement costs associated with initially establishing the
Common Areas; and all other reasonable and necessary (in the Landlord's
reasonable judgment) expenses paid in connection with the operation, cleaning,
maintenance and repair of the Property.
Operating Expenses for the Property shall not include the following:
(a) any cost or expense to the extent to which Landlord is paid or reimbursed,
or which is reimbursable to the Landlord, from the Tenant or a third party
(other than as a payment for Operating Expenses), including but not
necessarily limited to: (1) work or service performed for Tenant at its
cost and (2) the cost of any item for which the Landlord is paid or
reimbursed, or which is reimbursable, by insurance, warranties, service
contracts, condemnation proceeds, insurance reimbursements or otherwise;
(b) salaries and bonuses of officers or executives of Landlord or
administrative employees above the grade of University Park/Building
general manager, and if personnel below such grades are shared with other
buildings or have other duties not related to the Building, only the
allocable portion of such person or persons salary shall be included in
Operating Expenses;
(c) interest on debt or principal amortization payments (except as expressly
otherwise provided) or any other payments on any mortgage or any payments
under any ground lease;
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(d) any fees, costs, and commissions incurred in procuring or attempting to
procure other tenants including, but not necessarily limited to brokerage
commissions, finders fees, attorneys' fees and expenses, entertainment
costs and travel expenses;
(e) any cost included in Operating Expenses representing an amount paid to a
person, firm, corporation or other entity related to Landlord which is in
excess of the amount which would have been paid on an arms'-length basis in
the absence of such relationship (provided that nothing herein shall be
construed as requiring that the cost in question equal the lowest possible
cost; only that the cost not be inflated solely due to the absence of an
arms'-length relationship);
(f) any cost or expense which is applicable to or incurred for any parking
garage or parking lots, or any costs of personnel used to park cars,
collect money or provide special security, and garage management fees;
(g) depreciation of the Building or any part thereof;
(h) replacement or contingency reserves;
(i) legal, auditing, consulting and professional fees and other costs (other
than those legal, auditing, consulting and professional fees and other
costs incurred in connection with the normal and routine maintenance and
operation of the Building), including, without limitation, those: (i) paid
or incurred in connection with financings, refinancings or sales of any
Landlord's interest in the Building or University Park, (ii) relating to
specific disputes with tenants, and (iii) relating to any special reporting
required by securities laws;
(j) penalty interest, late charges, penalties and similar charges associated
with any failure by the Landlord and fulfill its obligations under this
Lease;
(k) bad debt loss or rent loss; and
(l) any cost incurred primarily as a consequence of the Landlord's negligence
or willful misconduct.
Any costs related to the Common Areas shall, for the purposes of
determining Operating Expenses for the Property, be allocated to the Building
based upon the methodology set forth in the Declaration of Covenants.
Payments by the Tenant for its share of the Operating Expenses for the
Property shall be made monthly at the time and in the fashion herein provided
for the payment of Annual Fixed Rent. The amount so to be paid to the Landlord
shall be an amount from time to time reasonably estimated by the Landlord to be
sufficient to aggregate a sum equal to the Tenant's share of the Operating
Expenses for the Property for each Operating Fiscal Year.
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<PAGE> 20
Not later than one hundred twenty (120) days after the end of each
Operating Fiscal Year or fraction thereof during the Term or fraction thereof at
the end of the Term, the Landlord shall render the Tenant a statement in
reasonable detail and according to usual accounting practices certified by an
officer of the Landlord, showing for the preceding Operating Fiscal Year or
fraction thereof, as the case may be, the Operating Expenses for the Property.
Said statement to be rendered to the Tenant also shall show for the preceding
Operating Fiscal Year or fraction thereof, as the case may be, the amounts of
Operating Expenses already paid by the Tenant. If at the time such statement is
rendered it is determined with respect to any Operating Fiscal Year, that the
Tenant has paid (i) less than the entirety of the Operating Expenses for the
Property or (ii) more than the Operating Expenses for the Property, then, in the
case of (i) the Tenant shall pay to the Landlord, as Additional Rent, within
thirty (30) days of such statement the amounts of such underpayment and, in the
case of (ii) the Landlord shall credit the amount of such overpayment against
the monthly installments of the Operating Expenses for the Building next
thereafter coming due (or refund such overpayment within thirty (30) days if the
Term has expired to the extent that such overpayment exceeds any amount then due
from the Tenant to the Landlord). If the Rent Commencement Date occurs on other
than the first day of an Operating Fiscal Year, or if the Termination Date
occurs on other than the last day of an Operating Fiscal Year, then the amount
of Operating Expenses for the Property payable by the Tenant with respect to
such Operating Fiscal Year(s) shall be pro-rated based upon the ratio of the
length of the time period during such Operating Fiscal Year(s) in respect of
which the Tenant has an obligation to pay Operating Expenses for the Property to
the length of such Operating Fiscal Year.
The Tenant may examine or audit the accounts and original bills for
Operating Expenses for the Property upon ten (10) days' prior written notice to
the Landlord, but no more often than one (1) time in any Operating Fiscal Year;
provided however, that if, during the course of any such examination or audit,
the Tenant reasonably believes that it has discovered an error in the amount of
Operating Expenses for the Property, the Tenant may review the accounts and
bills for the immediately two (2) preceding Operating Fiscal Years relating to
the subject matter of such error. The Landlord agrees that it will make
available to the Tenant in the Landlord's office in University Park, during
regular business hours, such information as the Landlord has available at such
office. In similar manner, the Tenant may examine such further records as the
Landlord (or its affiliates) may have, but such matters will be conducted where
the Landlord customarily keeps such records, which may be at the headquarters of
the Landlord's parent company. The Tenant shall bear the cost of any such audit,
unless the same discloses a discrepancy in excess of three percent (3%) of the
Operating Expenses for the Property, in which event the Landlord shall reimburse
the Tenant for such costs reasonably incurred. For any given Operating Fiscal
Year of the Landlord, the Tenant must, except in connection with errors
discovered during the course of an examination, as provided above, make any such
audit within twenty four (24) months after the Tenant's receipt of itemized
statements (and any supporting documentation requested by the Tenant) referred
to in the preceding paragraph. The Tenant must, except in connection with errors
discovered during the course of an examination, as provided above, further make
any claim for revision of Operating Expenses for the Property for such Operating
Fiscal Year by written notice to the Landlord within said twenty four (24) month
period. If the Tenant and the Landlord determine that Operating Expenses for the
Property are more or less than reported,
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either the Landlord shall provide the Tenant with a refund or a credit against
the next installment of Annual Fixed Rent and other charges or the Tenant shall
pay the Landlord the amount of any underpayment within thirty (30) days of
billing, provided that if the refund or credit to which the Tenant is entitled
relates to an error in Landlord's statement of Operating Expenses for the
Property which overstates the Operating Expenses for the Property by more than
three percent (3%), then interest at the Default Interest Rate accrue on any
such discrepancy from the date of overpayment by the Tenant to the date the
Tenant is credited or reimbursed in full therefor. The Landlord shall have no
right to give the Tenant any adjustment billing on account of Operating Expenses
for the Property incurred in any Operating Fiscal Year later than the date two
(2) years after the expiration of such Operating Fiscal Year.
Section 3.4 UTILITY CHARGES. During the Term, the Tenant shall pay directly
to the provider of the service, which in each case will be separately metered by
the Landlord to the extent specified in the Work Letter, but otherwise by the
Tenant, with respect to the Building, all charges for steam, gas, electricity,
fuel, water, sewer and other services and utilities furnished to the Premises.
Section 3.5 ABOVE-STANDARD SERVICES. If the Tenant requests and the
Landlord elects to provide any services to the Tenant in addition to those
described in EXHIBIT D, the Tenant shall pay to the Landlord, as Additional
Rent, the amount billed by Landlord for such services at Landlord's standard
rates as from time to time in effect, so long as such rates are consistent with
comparable services in comparable buildings within the Cambridge market. If the
Tenant has requested that such services be provided on a regular basis, the
Tenant shall, if requested by the Landlord, pay for such services at their
actual cost to Landlord, including, without limitation, a reasonable overhead
component, at the time and in the fashion in which Annual Fixed Rent under this
Lease is payable. Otherwise, the Tenant shall pay for such additional services
within thirty (30) days after receipt of an invoice from the Landlord.
Section 3.6 NO OFFSETS. Annual Fixed Rent and Additional Rent shall be paid
by the Tenant without offset, abatement or deduction except as provided herein.
ARTICLE 4
ALTERATIONS
Section 4.1 CONSENT REQUIRED FOR TENANT'S ALTERATIONS. The Tenant shall not
make alterations or additions to the Premises except in accordance with the
Tenant Design and Construction Manual, and with plans and specifications
therefor first approved by the Landlord, which approval shall not be withheld
unreasonably, conditioned or delayed. Notwithstanding the foregoing, the Tenant
may, from time to time without the Landlord's prior consent and at the Tenant's
own expense, make interior non-structural alterations and changes in and to the
Premises, provided that such alterations or changes (i) do not diminish the
value of the Building, (ii) are not incompatible with existing mechanical or
electrical, plumbing, HVAC or other
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systems in the Building, and (iii) do not affect the exterior appearance of the
Building. Whether or not the Tenant's changes and/or alterations require the
Landlord's consent pursuant to this paragraph, the Tenant shall, in each
instance, give reasonable prior notice to the Landlord of any alterations and
changes in and to the Premises costing $50,000.00 or more which the Tenant
intends to undertake, together with a reasonable description of the proposed
work and such plans and specifications, if any, as the Tenant has therefor and
promptly following the performance of any alterations or additions to the
Premises, the Tenant shall furnish Landlord an "as-built" set of plans and
specifications for the Premises, modified mechanical, electrical or plumbing
work, specifying the alterations or additions in question, in each case in a
fashion reasonably required by the Landlord, in addition to any other plans and
specifications furnished by Tenant to Landlord from time to time. The Landlord
shall not be deemed unreasonable for withholding approval of any alterations or
additions which (i) would, in the Landlord's reasonable judgment, adversely
affect any structural or exterior element of the Building, (ii) would in the
Landlord's reasonable judgment, adversely affect the general utility of the
Building for use by prospective future tenants thereof, (iii) would affect the
exterior appearance of the Building in a manner which is not acceptable to the
Landlord, in its sole discretion, (iv) will require unusual expense to readapt
the Premises to normal use as a biotechnology office and research and
development facility unless the Tenant first gives assurance acceptable to the
Landlord that such readaptation will be made prior to such termination without
expense to the Landlord; or (v) would not be compatible with existing mechanical
or electrical, plumbing, HVAC or other systems in the Building, in each case, as
reasonably determined by the Landlord; provided, however, that the Landlord
shall specify in any notice withholding approval specifying, in reasonable
detail, the nature of the Landlord's objection, and if the Tenant shall, at its
sole cost and expense, cure the Landlord's objections (in the Landlord's
reasonable judgment except in the case of the subject matter of clause (iii)
above), then the Landlord shall not withhold its approval. If the Tenant shall
request the Landlord's approval of proposed alterations under this Section 4.1,
and the Landlord fails to respond to the Tenant's request within ten (10)
business days thereof, then the Landlord shall be deemed to have given its
approval thereto if Landlord fails to respond to the Tenant's request within
five (5) business days following the delivery to the Landlord of a written
reminder notice, given by the Tenant on or following the expiration of the
aforementioned 10-day period, which reminder notice states the "deemed approval"
consequences of failure to respond. Neither the Landlord's failure to object to
any proposed alterations or additions, nor the Landlord's approval of any plans
and specifications furnished by Tenant to Landlord, shall be construed as
superseding in any respect, or as a waiver of Landlord's right to enforce, the
Tenant's obligation to fulfill all of the terms and conditions of this Lease
applicable to any work contemplated thereby.
Notwithstanding anything to the contrary contained in this Section 4.1, if
any of the Tenant's proposed alterations and/or additions affect the roof or the
envelope of the Building, the following additional conditions shall apply:
(a) Such alterations and changes will not in any way interfere with
the proper functioning of and Landlord's access to equipment located on the
roof of the Building; and
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(b) Adequate measures are taken to screen and otherwise reduce the
visibility and noise of such mechanical equipment, antennae and dishes
consistent with the appearance and design scheme required by the City of
Cambridge and other structures in University Park.
Section 4.2 OWNERSHIP OF ALTERATIONS. All alterations and additions shall
be part of the Building and owned by the Landlord; provided, however, that the
Landlord may require removal by the Tenant of all or any portion of any
alterations and additions made to the Premises, so long as the Landlord advised
the Tenant of such requirement prior to the installation of the alteration or
addition by the Tenant. If the Tenant fails to inform the Landlord, in writing,
at least ten (10) days prior to the installation of the alteration or addition,
thereby preventing the Landlord from making a determination as to whether it
will want such addition or alteration removed from the Premises prior to its
installation, then the Landlord shall advise the Tenant in writing of such
determination within ten (10) days after the Tenant gives the Landlord written
notice requesting that the Landlord make such determination. All movable
equipment, trade fixtures and furnishings not attached to the Premises shall
remain the personal property of the Tenant and shall be removed by the Tenant
upon termination or expiration of this Lease. Notwithstanding anything to the
contrary contained in this Section 4.2, any alterations and additions funded by
the Landlord, and installed as part of the Initial Leasehold Improvements (as
defined in the Work Letter) or otherwise (the "Landlord Funded Improvements"),
and all alterations and additions which are necessary for the use of the
Premises as an operational biotechnology laboratory (the "Base Laboratory
Improvements"), regardless of who funded their acquisition and installation,
shall be part of the Building and owned by the Landlord, and shall in no event
constitute the Tenant's personal property. For purposes of this Lease, "Base
Laboratory Improvements" shall include equipment that is integrated into the
Building which is consistent with and necessary for the operation of a standard,
high quality biotechnology research laboratory. Such equipment would include,
but would not be limited to, supply and exhaust ventilation systems; fume hoods
in reasonable quantity; environmental rooms in reasonable quantity; laboratory
benches in reasonable quantity, casework with associated shelving (whether fixed
or adjustable or otherwise capable of being relocated) in reasonable quantity,
fixtures, plumbing supply/waste lines and equipment associated therewith, gas
supply lines, a back-up electrical generator sufficient to meet critical power
requirements, and similar improvements. Base Laboratory Improvements does not
include stand-alone equipment such as autoclaves, cagewashers, glasswashers,
refrigerators, biosafety cabinets, NMR equipment, benchtop equipment, and
similar equipment, including without limitation the equipment specified in
EXHIBIT J attached hereto.
Within thirty (30) days of the occurrence of the Rent Commencement Date,
the Landlord and the Tenant shall review the final scope of the Initial
Leasehold Improvements and develop a mutually acceptable list of those installed
equipment items that will be deemed to be Base Laboratory Improvements, and
those that, by virtue of quantity, specialization or portability, will not be
deemed to be Base Laboratory Improvements and will therefore remain the property
of the Tenant, subject to the terms of this Lease.
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Any alterations and additions which are neither Landlord Funded
Improvements nor Base Laboratory Improvements shall remain the property of the
Tenant, and, if required to be removed upon the termination or expiration of
this Lease as hereinabove provided, shall be removed by the Tenant with
reasonable care and diligence, including the capping off of all utility
connections behind the adjacent interior finish, and the restoration of such
interior finish to the extent necessary so that the Premises are left with
complete wall, ceiling and floor finishes.
Section 4.3 CONSTRUCTION REQUIREMENTS FOR ALTERATIONS. All construction
work performed by or on behalf of the Tenant ("Tenant's Work"), including
without limitation any Initial Leasehold Improvements, shall be done in a good
and workmanlike manner employing only first-class materials and in compliance
with Landlord's construction rules and regulations and with all applicable laws
and all lawful ordinances, regulations and orders of Governmental authority and
insurers of the Building. The Landlord or Landlord's authorized agent may (but
without any implied obligation to do so) inspect the work of the Tenant at
reasonable times and shall give notice of observed defects. Tenant's Work and
the installation of furnishings shall always be coordinated in such manner as to
maintain harmonious labor relations within University Park and not to damage the
Building or interfere with Building construction or operation. Tenant's Work
shall be performed by contractors or workmen first approved by the Landlord,
which approval the Landlord agrees not to unreasonably withhold or delay. The
Landlord agrees to cooperate with the Tenant to develop a list of contractors
and workmen (which may change, from time to time) who are mutually acceptable
and are permitted to perform work in the Building. The Tenant, before starting
any work, shall receive and comply with the Landlord's construction rules and
regulations and shall cause the Tenant's contractors to comply therewith, except
in the case of the Initial Leasehold Improvements obtain "builder's risk"
coverage (in an amount that is reasonable given the quality and quantity of the
work to be undertaken) to enhance the insurance coverage otherwise required to
be carried by the Tenant, secure all licenses and permits necessary for such
work, and deliver to the Landlord a statement of the names of its general
contractor (or construction manager) and subcontractors who are to perform
mechanical, electrical or plumbing work or are otherwise to perform work that
will affect the structure or base building systems of the Building, and the
estimated cost of all labor and material to be furnished by them and security
satisfactory to the Landlord in its reasonable discretion and consistent with
the security requirements for comparable work in comparable buildings in the
Cambridge market protecting the Landlord against liens arising out of the
furnishing of such labor and material; and cause each contractor to carry
worker's compensation insurance in statutory amounts covering all the
contractors' and subcontractors' employees and comprehensive general public
liability insurance with limits (except as otherwise provided in the Work Letter
with respect to Initial Leasehold Improvements) of $1,000,000 (individual) and
$5,000,000 (occurrence), or in such lesser amounts as Landlord may accept,
covering personal injury and death and property damage (all such insurance to be
written in companies approved reasonably by the Landlord and insuring the
Landlord, such individuals and entities affiliated with the Landlord as the
Landlord may designate, any ground lessor or mortgagee that the Landlord may
designate, and the Tenant as well as the contractors and to contain a
requirement for at least thirty (30) days' notice to the Landlord prior to
cancellation, nonrenewal or material change), and to deliver to the Landlord
certificates of all such insurance.
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Section 4.4 PAYMENT FOR TENANT ALTERATIONS. The Tenant agrees to pay
promptly when due the entire cost of any work done on the Premises by the
Tenant, its agents, employees or independent contractors, and not to cause or
permit any liens for labor or materials performed or furnished in connection
therewith to attach to the Premises or the Property and promptly to discharge or
bond over any such liens which may so attach. If any such lien shall be filed
against the Premises or the Property and the Tenant shall fail to cause such
lien to be discharged, or bonded over, within fifteen (15) days after receipt by
the Tenant of notice of the filing thereof, the Landlord after a further five
(5) days' written notice may cause such lien to be discharged by payment, bond
or otherwise without investigation as to the validity thereof or as to any
offsets or defenses which the Tenant may have with respect to the amount
claimed. The Tenant shall reimburse the Landlord, as additional rent, for any
cost so incurred and shall indemnify and hold harmless the Landlord from and
against any and all claims, costs, damages, liabilities and expenses (including
reasonable attorneys' fees) which may be incurred or suffered by the Landlord by
reason of any such lien or its discharge. The Tenant's obligations under this
Section 4.4 with respect to the Initial Leasehold Improvements that are,
pursuant to the Work Letter, to be paid for with the proceeds of Landlord's
Contribution, are conditioned upon the Landlord's payment to the Tenant of
Landlord's Contribution in accordance with the Work Letter.
ARTICLE 5
RESPONSIBILITY FOR CONDITION OF BUILDING AND PREMISES
Section 5.1 MAINTENANCE OF BUILDING AND COMMON AREAS BY LANDLORD. Except as
otherwise provided in Article 8, the Landlord shall make such repairs to the
foundation system, roof, exterior walls (including exterior glass), floor slabs,
and any other structural elements of the Building as may be necessary to keep
them in good order, condition and repair, and make such repairs to the
mechanical systems and equipment serving the Building, exclusive of mechanical
systems and equipment that constitute either a component of the Initial
Leasehold Improvements, or other alterations or additions made by the Tenant
under Article 4 ("Tenant's Dedicated Mechanical Systems and Equipment"), as are
necessary to keep them in good order, condition and repair. The Landlord shall
further perform the services designated as Landlord's Services on EXHIBIT D.
Costs and expenses incurred by the Landlord under this Section 5.1 shall be
included in Operating Expenses of the Property only as permitted under Section
3.3. Subject to Section 7.5, the Tenant shall be responsible for 100% of the
cost of any repair to the Premises, the Building, or the Land caused by the
negligence or misconduct of the Tenant, or any agent, employee or contractor of
the Tenant, notwithstanding anything to the contrary provided in Section 3.3.
Section 5.2 MAINTENANCE OF PREMISES BY TENANT. The Tenant shall keep and
maintain in good order, condition and repair the Premises and every part thereof
and all of Tenant's Dedicated Mechanical Systems and Equipment, reasonable wear
and tear and damage by fire or other casualty excepted (provided that subject to
Section 7.5, the Landlord shall be responsible for damage caused by the fault or
neglect of the Landlord, or the Landlord's agents, employees
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or contractors), excluding those repairs for which the Landlord is responsible
pursuant to Sections 5.1, 8.1 and 8.5, and shall surrender the Premises and all
alterations and additions thereto, at the end of the Term, in such condition,
first removing all personal property of the Tenant and, to the extent required
pursuant to this Lease, all alterations and additions made by the Tenant,
repairing any damage caused by such removal and restoring the Premises and
leaving them in broom clean condition. If the Tenant elects to provide the
Tenant-Provided Services, identified as such in Section 5.3, the Tenant shall
perform the Tenant-Provided Services promptly, as necessary and appropriate,
with due diligence and in accordance with the standards therefor established
under Section 5.3. The Tenant shall not permit or commit any damage (waste), and
the Tenant shall, subject to Section 7.5, be responsible for the cost of repairs
which may be made necessary by reason of damage to the Property caused by the
negligence or misconduct of the Tenant, or any of the contractors, employees, or
agents of the Tenant. Tenant's Dedicated Mechanical Systems and Equipment, and
all other laboratory systems and equipment, shall be maintained in good order,
condition and repair consistent with prevailing standards at comparable
first-class leased biotechnology facilities, reasonable wear and tear, damage by
fire or other casualty, and subject to Section 7.5, damage caused by the fault
or neglect of the Landlord, or the Landlord's agents, employees, or contractors
excepted.
Section 5.3 TENANT-PROVIDED SERVICES. Notwithstanding anything to the
contrary contained in this Article 5, the Tenant may choose to provide, at its
own cost and expense, in lieu of the Landlord providing the same under this
Lease, services within the interior of the Building, associated directly with
the Tenant's use of the Building, including without limitation, the building
services specified in clauses F, G, H, I and J of EXHIBIT D, and such other
services as the Landlord may approve in its reasonable discretion. Such services
which are paid for and provided by the Tenant are hereinafter referred to as the
"Tenant-Provided Services." The provision by Tenant of Tenant-Provided Services
shall be subject to reasonable standards imposed by Landlord for the purpose of
assuring the fulfillment of the requirements of any ground lessee, mortgagee,
tenant, governmental authority or other third party pertaining to the
maintenance and operation of the Building in good order, condition and repair
and in compliance with all legal requirements.
Section 5.4 DELAYS IN LANDLORD'S SERVICES. The Landlord shall not be liable
to the Tenant for any compensation or reduction of rent by reason or
inconvenience or annoyance or for loss of business arising from the necessity of
the Landlord or its agents entering the Premises for any purposes authorized in
this Lease, or for repairing the Premises or any portion of the Building. In
case the Landlord is prevented or delayed from making any repairs, alterations
or improvements, or furnishing any services or performing any other covenant or
duty to be performed on the Landlord's part, by reason of any External Cause,
the Landlord shall not be liable to the Tenant therefor, nor, except as
expressly otherwise provided in this Lease, shall the Tenant be entitled to any
abatement or reduction of rent by reason thereof, nor shall the same give rise
to a claim in the Tenant's favor that such failure constitutes actual or
constructive, total or partial, eviction from the Premises.
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The Landlord reserves the right to stop any service or utility system the
Landlord provides or causes to be provided under this Lease (i.e. exclusive of
any Tenant-Provided Services or other obligations of the Tenant under this
Lease) when necessary by reason of accident or emergency, or until necessary
repairs have been completed; provided, however, that in each instance of
stoppage, the Landlord shall exercise reasonable diligence to eliminate the
cause thereof. Except in case of emergency repairs, the Landlord will give the
Tenant reasonable advance notice of the contemplated stoppage and will schedule
contemplated stoppages at times reasonably approved by the Tenant and will use
reasonable efforts to avoid unnecessary inconvenience to the Tenant by reason
thereof. To the extent that the Landlord is providing or causing to be provided
heat, light or any utility or service, in no event shall the Landlord have any
liability to the Tenant for the unavailability of the same to the extent that
such unavailability is caused by External Causes, provided, however, that the
Landlord is obligated to exercise reasonable efforts to restore such services or
utility systems' operation. The Landlord agrees to carry rent interruption
insurance in commercially reasonable amounts which permits recovery within, to
the extent reasonably available, five (5) days after the insured peril.
If the unavailability of heat, light or any utility or service provided or
caused to be provided by the Landlord other than the unavailability of the same
due to the Tenant's acts or omissions renders all or any portion of the Premises
untenantable for the Tenant's use as permitted under this Lease, and the Tenant
ceases to occupy the same for the conduct of its business, the Tenant shall
receive an equitable abatement of rent, taking into account the extent of the
Tenant's loss of use of the Premises, following the condition of untenantability
on and after the day following the expiration of the deductible period provided
in the Landlord's rent interruption insurance policy. For all purposes of this
Lease, if Tenant has responsibility for maintenance and repair of any aspect of
the Building or any equipment or system therein, the functioning and performance
of the same shall be the responsibility of the Tenant under this Lease, and
shall in no event constitute a service or utility system that the Landlord
provides or causes to be provided under this Lease.
Section 5.5 TENANT'S RESPONSIBILITIES REGARDING HAZARDOUS MATERIALS. The
Tenant covenants and agrees that the Tenant shall not use, generate, store or
dispose, nor shall the Tenant suffer or permit the use, generation, storing or
disposal in the Premises or otherwise by any of Tenant's contractors, licensees,
invitees, agents or employees, of any oil, toxic substances, hazardous wastes or
hazardous materials (collectively, "Hazardous Materials") in, on or about the
Premises, the Building or the Land, except for Hazardous Materials that are
necessary for Tenant's operation of Tenant's Permitted Use, as set forth on
EXHIBIT A, and in all cases such Hazardous Materials must be used, generated,
stored and disposed of in compliance with all applicable law and regulations.
The Tenant covenants and agrees that the Tenant shall comply with all applicable
laws and regulations and in handling and disposing of materials used in its
research and other uses of the Premises, whether or not considered Hazardous
Materials, and no dumping, flushing or other introduction of Hazardous Materials
or such other inappropriate materials into the septic, sewage or other waste
disposal systems serving the Premises shall occur, except as specifically
permitted by law and subject to the conditions and qualifications imposed by any
governmental license or permit. The Tenant shall provide to the Landlord copies
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of all licenses and permits that the Tenant has been required to obtain prior to
the handling of any such Hazardous Materials, and the Tenant must obtain all of
such licenses and permits prior to the commencement of operations in the
Premises requiring the same. From time to time during the Term of this Lease,
and thereafter during which the Tenant occupies any portion of the Premises, the
Tenant shall provide the Landlord with such reasonable substantiation of the
Tenant's compliance with the requirements of this Section 5.5 and any additional
requirements set forth in Section 6.2 as the Landlord may reasonably request.
The Tenant covenants and agrees that the Tenant shall, at its sole cost,
promptly remove or remediate all Hazardous Materials that are found upon the
Premises, the Building or the Land by virtue of the failure of the foregoing
covenants and agreements to have been fulfilled, or otherwise as the result of
the act or omission of Tenant or its contractors, licensees, agents or
employees, in a manner complying with all applicable laws and regulations and
the provisions of this Lease. If the Tenant should have any responsibility under
this Section 5.5 to remove or remediate Hazardous Materials, the Tenant shall
keep the Landlord reasonably informed as to the status of the environmental
condition at issue, promptly furnish to the Landlord copies of all regulatory
filings with any governmental regulatory agencies in connection therewith, and
substantiate the performance of its obligations under this Section 5.5.
Section 5.6 LANDLORD'S RESPONSIBILITIES REGARDING HAZARDOUS MATERIALS.
During the Term of this Lease, if the removal or remediation of Hazardous
Materials from the Premises, Building or Land is required to be undertaken, then
except to the extent such obligation is the responsibility of the Tenant under
Section 5.5 hereof, the Landlord covenants and agrees to undertake the same
without charge to the Tenant. Without limitation of the foregoing, if necessary
to comply with any applicable legal requirements, should the existing
environmental condition of the Land require the removal or remediation of
Hazardous Materials, the Landlord shall perform such removal or remediation,
without charge to the Tenant, when and if required by applicable legal
requirements. The Landlord shall keep the Tenant reasonably informed as to the
status of the environmental condition at issue, promptly furnish to the Tenant
copies of all regulatory filings with any governmental regulatory agencies in
connection therewith, and substantiate the performance of its obligations under
this Section 5.6.
If the Premises shall be rendered no longer reasonably occupiable as a
consequence of the presence of Hazardous Materials for which the Landlord is
responsible for undertaking remediation under this Section 5.6, and the presence
of such Hazardous Materials is introduced to the Premises by the Landlord, then
until the Premises is again reasonably occupiable, the Annual Fixed Rent and
Additional Rent shall be justly and equitably abated and reduced according to
the nature and extent of the loss of use thereof suffered by the Tenant.
Section 5.7 CROSS INDEMNIFICATION. Each of the Landlord and the Tenant
shall defend and indemnify the other and hold the other harmless from and
against any damages, liability or expense associated with claims by governmental
or other third parties arising out of the presence, removal or remediation of
Hazardous Materials for which the indemnifying party is responsible for removal
or remediation under this Lease.
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ARTICLE 6
TENANT COVENANTS
The Tenant covenants during the Term and for such further time as the
Tenant occupies any part of the Premises:
Section 6.1 PERMITTED USES. The Tenant shall occupy the Premises only for
the Permitted Uses, and shall not injure or deface the Premises or the Property,
nor permit in the Premises any auction sale. The Tenant shall give written
notice to the Landlord, within twenty (20) days prior to the Rent Commencement
Date and thereafter once annually within twenty (20) days of each anniversary of
the Rent Commencement Date, of any materials on OSHA's right to know list or
which are subject to regulation by any other federal, state, municipal or other
governmental authority and which the Tenant intends to have present at the
Premises. The Tenant shall comply with all requirements of public authorities
and of the Board of Fire Underwriters in connection with methods of storage, use
and disposal thereof although nothing herein shall prevent the Tenant from
challenging the validity of such requirements. The Tenant shall not permit in
the Premises any nuisance, or the emission from the Premises of any reasonably
objectionable noise, odor or vibration, nor use or devote the Premises or any
part thereof for any purpose which is contrary to law or ordinance, or liable to
invalidate or increase premiums (above those normally incurred for Permitted
Uses) for any insurance on the Building or its contents (unless the Tenant pays
for any such increase in premiums and provided such actions do not interfere
with the use and enjoyment of the Land by the Landlord, other tenants, visitors
or invitees of University Park) or liable to render necessary any alteration or
addition to the Building, nor commit or permit any waste in or with respect to
the Premises.
Section 6.2 LAWS AND REGULATIONS. The Tenant shall comply with all federal,
state and local laws, regulations, ordinances. executive orders, federal
guidelines, and similar requirements in effect from time to time, including,
without limitation, City of Cambridge ordinances numbered 1005 and 1086 and any
subsequently adopted ordinance for employment and animal experimentation with
respect to animal experiments and hazardous waste and any such requirements
pertaining to employment opportunity, anti-discrimination and affirmative
action. Tenant shall have the right to contest any notice of violation for any
of the foregoing by appropriate proceedings diligently conducted in good faith.
Section 6.3 RULES AND REGULATIONS; SIGNS. The Tenant agrees to comply with
such reasonable and non-discriminatorily enforced rules and regulations of
general applicability ("Rules and Regulations") as (i) may from time to time be
made by the Landlord of which the Tenant is given written notice, so far as the
same relate to the use of the Building, the Land and the Tenant's appurtenant
parking privileges and (ii) may from time to time be promulgated under the
Declaration of Covenants with respect to all or any portion of University Park.
The Tenant shall not obstruct in any manner any portion of the Property; and,
except as set forth in this Lease, shall not permit the placing of any signs,
curtains, blinds, shades, awnings or flagpoles, or the like, visible from
outside the Building.
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The Tenant shall have the right to install a maximum of two (2) signs with
its corporate logo on the facade of the Building and a single identity plaque at
the main Building entrance. Any such exterior sign, however, shall be subject to
prior approval by the City of Cambridge, and subject to the Landlord's
reasonable approval regarding the content, size, design and location on the
Building facade, and all applicable legal requirements. Landlord and Tenant will
work together to implement the aforesaid signage program. Landlord shall provide
street numbering signage and code required signage for the Common Areas.
Section 6.4 SAFETY COMPLIANCE. The Tenant shall keep the Premises equipped
with all safety appliances required by law or ordinance or any other regulations
of any public authority because of the manner of use made by the Tenant and to
procure all licenses and permits so required because of such manner of use and,
if requested by the Landlord, do any work so required because of such use, it
being understood that the foregoing provisions shall not be construed to broaden
in any way the Tenant's Permitted Uses. Tenant shall conduct such periodic
tests, evaluations or certifications of safety appliances and laboratory
equipment as are required or recommended in accordance with generally accepted
standards for good laboratory practice to ensure that such safety appliances and
equipment remain in good working order, and shall, upon Landlord's reasonable
request but not more often than two (2) times in any calendar year, provide to
Landlord copies of such reports, evaluations and certifications.
Section 6.5 LANDLORD'S ENTRY. The Tenant shall permit the Landlord and it
agents, after at least twenty four (24) hours' notice except in the case of
emergencies, to enter the Premises at all reasonable hours for the purpose of
inspecting or making repairs to the same, monitoring Tenant's compliance with
the requirements and restrictions set forth in this Lease, and for the purpose
of showing the Premises to prospective purchasers and mortgagees at all
reasonable times and to prospective tenants within twelve (12) months of the end
of the Term provided that in connection with such entry, Tenant may provide
procedures reasonably designed so as not to jeopardize Tenant's trade secrets,
proprietary technology or critical business operations, including accompaniment
of all such persons by an employee of the Tenant. In case of an emergency, the
Landlord shall make good faith efforts to notify the Tenant in person or by
telephone prior to such entry, and in any event, the Landlord shall notify
Tenant promptly thereafter such entry.
Section 6.6 FLOOR LOAD. The Tenant shall not place a load upon any floor in
the Premises exceeding the floor load per square foot of area which such floor
was designed to carry, and which is allowed by law. The Tenant's machines and
mechanical equipment shall be placed and maintained by the Tenant at the
Tenant's expense in settings sufficient to absorb or prevent vibration or noise
that may be transmitted to the Building structure.
Section 6.7 PERSONAL PROPERTY TAX. The Tenant shall pay promptly when due
all taxes which may be imposed upon personal property (including, without
limitation, fixtures and equipment) in the Premises to whomever assessed. Tenant
shall have the right to contest the validity or amount of any such taxes by
appropriate proceedings diligently conducted in good faith.
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Section 6.8 ASSIGNMENT AND SUBLEASES. The Tenant shall not assign this
Lease or sublet (which term, without limitation, shall include granting of
concessions, licenses and the like) the whole or any part of the Premises, nor
permit the further underletting or assignment of any sublease or other occupancy
agreement (each a "Transfer") without, in each instance, having first received
the consent of the Landlord which consent shall not be unreasonably withheld or
delayed, except in the case of Permitted Transfers, with respect to which the
Landlord's consent shall not be required so long as a condition constituting an
Event of Default is not then subsisting. In no event shall any of the Tenant's
rights with respect to the roof of the Building be assigned or sublet other than
in connection with a Transfer of the whole or any part of the Premises for
purposes of enabling the transferee to occupy the same for the conduct of its
business therein (provided that the occupancy of part of the Premises in service
of a business the substantial orientation of which is roof communications shall
not qualify as such an occupancy), or to a service provider using such roof
rights exclusively for the purpose of providing services to the Tenant in
connection with the conduct of the Tenant's business (other than a
communications business). Any purported Transfer made without such consent or
otherwise not fulfilling the conditions and requirements of this Section 6.8
shall be void, and except as specifically permitted in this Section 6.8, in no
event shall the Tenant or anyone claiming by, through or under the Tenant have
the right to mortgage, pledge, hypothecate or otherwise transfer this Lease. The
Landlord shall not be deemed to be unreasonable in withholding its consent to
any proposed Transfer that is subject to the Landlord's consent based on any of
the following factors:
(a) If the manner in which the proposed occupant conducts its business
operations is not consistent, in Landlord's reasonable opinion, with the
image and character of the University Park development as a first-class
office/research and development park, then the withholding of consent by
the Landlord shall be considered reasonable and
(b) If the proposed Transfer is (i) an assignment of this Lease, or
(ii) a sublease where as a result of the consummation of such sublease, the
then Tenant shall no longer be in occupancy of at least sixty five percent
(65%) of the rentable floor area of the Premises (e.g. any sublease that
would result in more than thirty five percent (35%) of the rentable floor
area of the Premises being subject to a sublease, subleases or other
occupancy agreements), then in either of such cases, if the proposed
occupant is not sufficiently creditworthy in the reasonable opinion of the
Landlord with reference to the obligations which are to be fulfilled by the
tenant under this Lease, and the reasonable needs of the Landlord to
protect the value of the Building, then the withholding of consent by the
Landlord shall be considered reasonable.
If the proposed occupant is already involved in discussions with either the
Landlord or any affiliate of the Landlord regarding space within University Park
that is or is to become available for lease, then the withholding of consent by
the Landlord shall be considered reasonable.
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Notwithstanding anything to the contrary contained in this Section, Tenant
shall have the right to assign or otherwise transfer this Lease or the Premises,
or part of the Premises, without obtaining the prior consent of Landlord, (a) to
an entity owning a majority of Tenant or to a majority owned subsidiary or to an
entity which is majority owned by the same entity which owns a majority of
Tenant (any of the foregoing being referred to herein as a "Tenant Affiliate"),
provided that (i) the transferee shall, subject to applicable law, regulation or
prior binding agreement, prior to the effective date of the transfer, deliver to
Landlord instruments evidencing such transfer and its agreement to assume and be
bound by all the terms, conditions and covenants of this Lease to be performed
by Tenant, all in form reasonably acceptable to Landlord, and (ii) at the time
of such transfer there shall not be an uncured Event of Default under this
Lease; or (b) to the purchaser of at least fifty percent (50%) of its assets or
stock, or to any entity into which the Tenant may be merged or consolidated
(along with all or substantially all of its assets) (the "Acquiring Company"),
provided that (i) the net worth of the Acquiring Company upon the consummation
of the transfer or merger shall not be less than the net worth of the Tenant at
the time immediately prior to such transfer or merger, (ii) the Acquiring
Company continues to operate the business conducted in the Premises consistent
with the Permitted Uses described in Exhibit A hereto, (iii) the Acquiring
Company shall assume in writing, in form reasonably acceptable to Landlord, all
of Tenant's obligations under this Lease, (iv) Tenant shall provide to Landlord
such additional information regarding the Acquiring Company as Landlord shall
reasonably request, and (v) Tenant shall pay Landlord's reasonable out-of-pocket
expenses incurred in connection therewith. Unless Landlord shall have objected
to such assignment or transfer by Tenant within ten (10) business days following
Landlord's receipt of the information or items described in (b)(i) and (iii)
above, then Landlord shall be deemed to have waived its right to object thereto.
Each of the transfers described in this paragraph is referred to hereinafter as
"Permitted Transfers." In no event shall any transaction consummated for the
purpose of evading Tenant's obligation to obtain Landlord's consent under this
Section 6.8 be construed as a Permitted Transfer, notwithstanding that such
transaction otherwise qualifies as a Permitted Transfer.
Whether or not the Landlord consents, or is required to consent, to any
Transfer, the Tenant named herein shall remain fully and primarily liable for
the obligations of the Tenant hereunder, including, without limitation, the
obligation to pay Annual Fixed Rent and Additional Rent provided under this
Lease.
The Tenant shall give the Landlord notice of any proposed Transfer (other
than a Permitted Transfer), specifying the provisions thereof, including (i) the
name and address of the proposed occupant, subtenant, assignee, mortgagee or
other transferee, (ii) a copy of the proposed occupant's, subtenant's,
assignee's, mortgagee's or other transferee's most recent annual financial
statement, and (iii) all of the terms and provisions upon which the proposed
Transfer is to be made including, without limitation, all of the documentation
effectuating such Transfer (which shall be subject to the Landlord's approval
not to be unreasonably withheld) and such other reasonable information
concerning the proposed Transfer or concerning the proposed occupant, subtenant,
assignee, mortgagee or other transferee as the Tenant has obtained in connection
with the proposed Transfer. The Tenant shall reimburse the Landlord promptly for
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reasonable legal and other reasonable expenses incurred by the Landlord in
connection with any request by the Tenant for consent to any Transfer. If this
Lease is assigned, or if the Premises or any part thereof is sublet or occupied
by anyone other than the Tenant, or there is otherwise a Transfer, then during
any time when an Event of Default is subsisting, the Landlord may, at any time
and from time to time, collect rent and other charges from the assignee,
sublessee, occupant, mortgagee or transferee, and apply the net amount collected
to the rent and other charges herein reserved, but no such assignment,
subletting, occupancy or collection shall be deemed a waiver of the prohibitions
contained in this Section 6.8 or the acceptance of the assignee, sublessee or
occupant as a tenant or a release of the Tenant from the further performance by
the Tenant of covenants on the part of the Tenant herein contained.
The Tenant shall pay to the Landlord fifty percent (50%) of any amounts the
Tenant receives from any occupant, subtenant, assignee or other transferee other
than a Permitted Transferee, as rent, additional rent or other forms of
compensation or reimbursement (if any) in excess of the aggregate amount of (i)
the proportionate monthly share of Annual Fixed Rent, Additional Rent and all
other monies due to Landlord pursuant to this Lease (allocable in the case of a
sublease to that portion of the Premises being subleased), (ii) brokerage
commissions and fees for legal services associated with the transaction, (iii)
any expenses incurred by the Tenant in connection with preparing the Premises or
applicable portion thereof for occupancy by such subtenant, assignee or other
transferee and (iv) any monetary concessions paid to the subtenant, assignee or
other transferee such as, but not limited to, reimbursement of moving expenses
(collectively "Sublease Transaction Expenses"). In the circumstances where the
transferee pays the consideration due to the Tenant on account of such transfer
over time (e.g. monthly rental payments under a sublease), Sublease Transaction
Expenses shall be amortized on a straight-line basis over the term of the
transfer in question, together with interest at a rate which is reasonably
satisfactory to the Landlord. Neither the fact that the Landlord's consent may
not be required in order for the Tenant to effectuate a Permitted Transfer, nor
the consent by the Landlord to a Transfer for which the Landlord's consent is
required shall be construed to relieve the Tenant from the obligation to obtain
the express consent in writing of the Landlord to any further Transfer whether
by the Tenant or by anyone claiming by, through or under the Tenant including,
without limitation, any occupant, assignee, subtenant, mortgagee or other
transferee, excluding any Permitted Transfer.
The Landlord may elect, within thirty (30) days of receipt of written
notice from the Tenant of any proposed assignment of this Lease prior to
approving or disapproving any such proposed assignment, to repossess the
Premises. The Landlord may thereafter lease the Premises in such a manner as the
Landlord may in its sole discretion determine. In the event the Landlord elects
to repossess the Premises as provided above, then all of the Tenant's rights and
obligations hereunder with respect to the Premises shall cease and shall be of
no further force and effect. The provisions of this paragraph shall not apply to
Permitted Transfers.
If the Landlord withholds consent to a proposed Transfer, in any case where
the Landlord is bound by this Lease not to unreasonably withhold such consent,
and the Tenant disputes the reasonability of the Landlord's withholding of such
consent, then either party may, at its election,
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have the dispute resolved by the Expedited Dispute Resolution Procedure. The
Landlord shall have no liability for having unreasonably withheld consent to
such a Transfer provided that the Landlord may be required to give such consent
pursuant to the Expedited Dispute Resolution Procedure.
ARTICLE 7
INDEMNITY AND INSURANCE
Section 7.1 INDEMNITY. The Tenant shall indemnify and save harmless the
Landlord and the Landlord's ground lessees, mortgagees and managing agent for
the Building from and against all claims, loss, or damage of whatever nature
arising from (i) any breach by Tenant of any obligation of Tenant under this
Lease, or (ii) any negligence or misconduct of the Tenant, or the Tenant's
contractors, licensees, agents, servants or employees, or (iii) any accident,
injury or damage whatsoever caused to any person or property in the Building or
on or about the Land, occurring after the Rent Commencement Date (or such
earlier date upon which the Tenant first commences occupancy [as distinguished
from construction of Initial Leasehold Improvements by the Contractor (as
defined in the Work Letter)] of all or any part of the Premises) and until the
end of the Term and thereafter, so long as the Tenant is in occupancy of any
part of the Premises, provided that the foregoing indemnity shall not include
any claims, loss or damage to the extent arising from any negligence or
misconduct of the Landlord, or the Landlord's contractors, licensees, agents,
servants or employees or the Landlord's ground lessees, mortgagees or managing
agent for the Building.
The Landlord shall indemnify and save harmless the Tenant from and against
all claims, loss, or damage of whatever nature arising from (i) any breach by
Landlord of any obligation of Landlord under this Lease or (ii) from any
negligence or misconduct of the Landlord, or the Landlord's contractors,
licensees, agents, servants or employees, provided that the foregoing indemnity
shall not include any claims, loss or damage to the extent arising from any act,
omission or negligence of the Tenant, or the Tenant's contractors, licensees,
agents, servants or employees, occurring following the Rent Commencement Date
and until the expiration of earlier termination of the Term of this Lease.
The foregoing indemnity and hold harmless agreements shall include
indemnity against reasonable attorneys' fees and all other costs, expenses and
liabilities incurred in connection with any such claim or proceeding brought
thereon, and the defense thereof, but shall be subject to the limitations
specified in Sections 7.5 and 12.16.
Section 7.2 LIABILITY INSURANCE. The Tenant agrees to maintain in full
force from the Rent Commencement Date (or such earlier date upon which the
Tenant first commences occupancy [as distinguished from construction of Initial
Leasehold Improvements by the Contractor (as defined in the Work Letter)] of all
or any part of the Premises), throughout the Term, and thereafter, so long as
the Tenant is in occupancy of any part of the Premises, a policy
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of commercial general liability insurance under which the Landlord (and any
individuals or entities affiliated with the Landlord, any ground lessor and any
holder of a mortgage on the Property of whom the Tenant is notified by the
Landlord) are named as additional insureds, and under which the insurer provides
a contractual liability endorsement insuring against all cost, expense and
liability arising out of or based upon any and all claims, accidents, injuries
and damages described in Section 7.1, in the broadest form of such coverage from
time to time available. Each such policy shall be noncancelable and nonamendable
(to the extent that any proposed amendment reduces the limits or the scope of
the insurance required in this Lease) with respect to the Landlord and such
ground lessors and mortgagees without thirty (30) days' prior notice to the
Landlord and such ground lessors and mortgagees and at the election of the
Landlord, either a certificate of insurance or a duplicate original policy shall
be delivered to the Landlord. The minimum limits of liability of such insurance
as of the Commencement Date shall be Ten Million Dollars ($10,000,000.00) for
combined bodily injury (or death) and damage to property (per occurrence) with
an aggregate annual limit of liability of Ten Million Dollars ($10,000,000.00),
and from time to time during the Term such limits of liability shall be
increased to reflect such higher limits as are customarily required pursuant to
new leases of space in the Boston-Cambridge area with respect to similar
properties. Such insurance may be effected with a combination of a base
commercial general liability policy and umbrella insurance.
Section 7.3 PERSONAL PROPERTY AT RISK. The Tenant agrees that all of the
furnishings, fixtures, equipment, effects and property of every kind, nature and
description of the Tenant and of all persons claiming by, through or under the
Tenant which, during the continuance of this Lease or any occupancy of the
Premises by the Tenant or anyone claiming under the Tenant which, during the
continuance of this Lease or any occupancy of the Premises by the Tenant or
anyone claiming under the Tenant, may be on the Premises or elsewhere in the
Building or on the Land or parking facilities provided hereby, shall be at the
sole risk and hazard of the Tenant, and if the whole or any part thereof shall
be destroyed or damaged by fire, water or otherwise, or by the leakage or
bursting of water pipes, steam pipes, or other pipes, by theft or from any other
cause, no part of said loss or damage is to be charged to or be borne by the
Landlord, except that the Landlord shall in no event be exonerated from any
liability to the Tenant or to any person, for any injury, loss, damage or
liability to the extent caused by Landlord's or its employees', agents' or
contractors' negligence or willful misconduct.
Section 7.4 LANDLORD'S INSURANCE. The Landlord shall, from and after the
Rent Commencement Date and until the expiration or earlier termination of the
Term of this Lease, carry such "all risk" casualty in an amount equal to at
least the replacement cost for the Building with a deductible in amounts carried
at comparable buildings with similar uses within the Cambridge market or
required by any mortgagee holding a mortgage thereon or any ground lessor of the
Land, in an amount equal to the replacement cost of the Building, including all
leasehold improvements, exclusive of foundations, site preparation and other
nonrecurring construction costs. The Landlord shall also, during the aforesaid
period, carry commercial general liability insurance with the same limits which
the Tenant is required to carry from time to time upon and with respect to
operations at the Building, which shall similarly be noncancellable and
nonamendable (to the extent that any proposed amendment reduces the limits or
the scope of
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insurance required in this Lease) with respect to the Tenant without thirty (30)
days' prior notice to the Tenant.
Section 7.5 WAIVER OF SUBROGATION. Any casualty insurance carried by either
party with respect to the Building, Land, Premises, parking facilities or any
property therein or occurrences thereon shall, without further request by either
party, include a clause or endorsement denying to the insurer rights of
subrogation against the other party (and the Landlord's policy shall also deny
the insurer rights of subrogation against any permitted subtenant and any such
subtenant shall be required to carry a policy that denies the insurer rights of
subrogation against the Landlord) to the extent rights have been waived by the
insured prior to occurrence of injury or loss. Each party, notwithstanding any
provisions of this Lease to the contrary, hereby waives any rights of recovery
against the other (and the Landlord hereby waives any right of recovery which
the Landlord has against any permitted subtenant, and any sublease will require
that the subtenant waive any right of recovery which any such subtenant may have
against the Landlord) for loss or damage to property, including, without
limitation, loss or damage caused by negligence of such other party, due to
hazards covered by casualty insurance which such party is required to carry
hereunder, except with respect to any damage within the deductible under such
insurance policy.
Section 7.6 POLICY REQUIREMENTS. Any required insurance may be in the form
of blanket coverage, so long as the coverage required herein is maintained. Each
party shall cause a certificate, providing such information as reasonably
requested by the other party, evidencing the existence and limits of its
insurance coverage with respect to the Premises and the Building, as the case
may be, to be delivered to such other party upon the commencement of the Term.
Thereafter, each party shall cause similar certificates evidencing renewal
policies to be delivered to such other party at least thirty (30) days prior to
the expiration of the term of each policy and at such other times as reasonably
requested by the other party. The insurance policies and certificates required
by this Article 7 shall contain a provision requiring the insurance company to
furnish Landlord and Tenant, as the case may be, thirty (30) days' prior written
notice of any cancellation or lapse, or the effective date of any reduction in
the amounts or scope of coverage. The Landlord shall have reasonable approval
over the identity of the Tenant's insurance underwriter.
ARTICLE 8
CASUALTY AND EMINENT DOMAIN
Section 8.1 RESTORATION FOLLOWING CASUALTIES. If, during the Term, the
Building or the Premises shall be damaged by fire or casualty, subject to
termination rights of the Landlord and the Tenant provided below in this Article
8, the Landlord shall proceed promptly to exercise diligent efforts to restore,
or cause to be restored, the Building to substantially the condition thereof
just prior to time of such damage, but the Landlord shall not be responsible for
delay in such restoration which may result from External Causes. Provided that
the Landlord complies with its obligations to carry casualty insurance in
accordance with Section 7.4, the Landlord shall
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have no obligation to expend in the reconstruction of the Building more than the
sum of the amount of any deductible and the actual amount of insurance proceeds
made available to the Landlord by its insurer, and any additional costs
associated with changes to the Premises desired by the Tenant and permitted by
Article 4 shall be paid by the Tenant in the manner reasonably required by the
Landlord. Any restoration of the Building or the Premises shall be altered to
the extent necessary to comply with then current and applicable laws and codes.
The Landlord shall, as soon as possible after any casualty, but in any event no
later than sixty (60) days after such casualty, provide to the Tenant a
reasonable written estimate ("Architect's Estimate") from a reputable architect
or other design professional as to the time frame within which the Landlord will
be able to repair the casualty damage and the cost of repairing such damage, and
the Landlord's reasonable determination ("Insurance Proceeds Estimate") as to
the amount of insurance proceeds which will be available to repair such damage.
Section 8.2 LANDLORD'S TERMINATION ELECTION. If the Landlord reasonably
determines, based upon the Architect's Estimate and the Insurance Proceeds
Estimate, that (a) the amount of insurance proceeds available to the Landlord is
insufficient (by more than the amount of any deductible) to cover the cost of
restoring the Building by more than the amount of any deductible (provided
however, that the Landlord shall not have the right to terminate the Lease
pursuant to this clause (a) if the casualty would have been covered by casualty
insurance which the Landlord is required to obtain pursuant to Section 7.4), or
(b) the Landlord will be unable to restore the Building within twelve (12)
months from the date of such casualty, then the Landlord may terminate this
Lease by giving notice to the Tenant at the time that the Landlord provides to
the Tenant the Architect's Estimate and the Insurance Proceeds Estimate. Any
such termination shall be effective on the date designated in such notice from
the Landlord, but in any event not later than sixty (60) days after such notice,
and if no date is specified, effective upon the delivery of such notice. Failure
by the Landlord to give the Tenant notice of termination within ninety (90) days
following the occurrence of the casualty shall constitute the Landlord's
agreement to restore the Building as contemplated in Section 8.1.
Section 8.3 TENANT'S TERMINATION ELECTIONS. If, based upon the Architect's
Estimate and the Insurance Proceeds Estimate, the time period for repairing any
casualty damage will exceed twelve (12) months after the date of any casualty,
then the Tenant shall have the right, exercisable by written notice given on or
before the date thirty (30) days after the Landlord gives to the Tenant the
Architect's Estimate and the Insurance Proceeds Estimate, to terminate this
Lease.
If neither the Landlord nor the Tenant exercise their termination rights
based upon the Architect's Estimate and the Insurance Proceeds Estimate, but the
Landlord has failed to restore the Building, within twelve (12) months from the
date of the casualty or taking, such period to be subject, however, to extension
(which extension shall not exceed an additional one hundred eighty (180) days)
where the delay in completion of such work is due to External Causes, the Tenant
shall have the right to terminate this Lease at any time after the expiration of
such 12-month period (as extended by delay due to External Causes as aforesaid),
as the case may be, until the restoration is substantially completed, such
termination to take effect as of the date of
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the Tenant's notice. However, if the Landlord has been diligently prosecuting
the repair of all casualty and damage, and if the Landlord reasonably determines
at any time, and from time to time, during the restoration, based upon
certification by its architect or other design professional, that such
restoration will not be able to be completed before the deadline date after
which the Tenant may terminate this Lease under this Section 8.3, and the
Landlord specifies in a notice to Tenant to such effect a later date that the
Landlord estimates will be the date upon which such restoration will be
completed, then the Tenant may terminate this Lease within thirty (30) days of
the Landlord's notice as aforesaid, failing which the deadline date shall be
extended to the date set forth in Landlord's notice (as extended by delay due to
External Causes as aforesaid). The Landlord shall exercise reasonable efforts to
keep the Tenant advised of the status of restoration work from time to time, and
promptly following any request for information during the course of the
performance of the restoration work.
Section 8.4 CASUALTY AT EXPIRATION OF LEASE. If the Premises shall be
damaged by fire or casualty in such a manner that the Premises cannot, in the
ordinary course, reasonably be expected to be repaired within one hundred twenty
(120) days from the commencement of repair work and such damage occurs within
the last twenty four (24) months of the Term (as the same may have been extended
prior to such fire or casualty), either party shall have the right, by giving
notice to the other not later than sixty (60) days after such damage, to
terminate this Lease, whereupon this Lease shall terminate as of the date of
such notice. Notwithstanding the foregoing, the Landlord shall not have the
right to terminate this Lease as aforesaid provided that the Tenant shall have
exercised its right to extend the Term of this Lease pursuant to Section 2.6
hereof not later than forty-five (45) days after the date of damage to the
Premises.
Section 8.5 EMINENT DOMAIN. Except as hereinafter provided, if the
Premises, or such portion thereof as to render the balance (if reconstructed to
the maximum extent practicable in the circumstances) unsuitable for continued
occupancy for the purposes contemplated under this Lease, shall be taken by
condemnation or right of eminent domain, and the Landlord and the Tenant shall
each have the right to terminate this Lease by notice to the other of its desire
to do so, provided that such notice is given not later than thirty (30) days
after receipt by the Tenant of notice of the effective date of such taking. If
so much of the Building shall be so taken that the Landlord reasonably
determines, in good faith, that it would be necessary to substantially alter the
Building so that a rebuilt Building will not be substantially similar to the
Building before such taking, the Landlord shall have the right to terminate this
Lease by giving notice to the Tenant of the Landlord's desire to do so not later
than thirty (30) days after the effective date of such taking.
Should any part of the Premises be so taken or condemned during the Term,
and should this Lease be not terminated in accordance with the foregoing
provisions, the Landlord agrees to use reasonable efforts to put what may remain
of the Premises into proper condition for use and occupation as nearly like the
condition of the Premises prior to such taking as shall be practicable, subject,
however, to applicable laws and codes then in existence. The Landlord shall
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have no obligation to expend in the aforesaid restoration more than the proceeds
of any award received in any condemnation or eminent domain proceeding, or any
sum paid in lieu thereof.
Section 8.6 RENT AFTER CASUALTY OR TAKING. If the Premises shall be damaged
by fire or other casualty, until the Lease is terminated or the Premises is
restored, the Annual Fixed Rent and Additional Rent shall be justly and
equitably abated and reduced according to the nature and extent of the loss of
use thereof suffered by the Tenant. In the event of a taking which permanently
reduces the area of the Premises, a just proportion of the Annual Fixed Rent and
applicable Additional Rent shall be abated for the remainder of the Term.
Section 8.7 TEMPORARY TAKING. In the event of any taking of the Premises or
any part thereof for a temporary use not in excess of twelve (12) months, (i)
this Lease shall be and remain unaffected thereby and Annual Fixed Rent and
Additional Rent shall not abate, and (ii) the Tenant shall be entitled to
receive for itself such portion or portions of any award made for such use with
respect to the period of the taking which is within the Term.
Section 8.8 TAKING AWARD. Except as otherwise provided in Section 8.7, the
Landlord shall have and hereby reserves and accepts, and the Tenant hereby
grants and assigns to the Landlord, all rights to recover for damages to the
Building and the Land, and the leasehold interest hereby created, and to
compensation accrued or hereafter to accrue by reason of such taking, damage or
destruction, as aforesaid, and by way of confirming the foregoing, the Tenant
hereby grants and assigns to the Landlord, all rights to such damages or
compensation. Nothing contained herein shall be construed to prevent the Tenant
from prosecuting in any condemnation proceedings a claim for relocation expenses
and improvements made by the Tenant in the Premises that constitute Tenant's
personal property, including the Removable Alterations.
Section 8.9 CASUALTY OR EMINENT DOMAIN AFFECTING PARKING PRIVILEGES. If,
during the Term, there shall be damage by fire or casualty, or a taking by
condemnation or right of eminent domain, that results in the Landlord reducing
the number of Parking Passes that permit the Tenant to park in parking spaces
within University Park (a "University Park Parking Privileges Reduction"), then
notwithstanding anything to the contrary provided in EXHIBIT A, the Landlord may
substitute alternative parking arrangements ("Temporary Substitute Parking
Arrangements") within a one-mile radius of University Park that will provide
parking areas with respect to which the Tenant may (using the Parking Passes
that may no longer be used for parking within University Park) enjoy the parking
privileges contemplated hereby, provided that any such alternative parking areas
shall be reasonably well lit, and there shall be provided shuttle bus
transportation to and from University Park from such alternative parking areas,
on terms reasonably satisfactory to the Tenant. The Landlord's furnishing of
Temporary Substitute Parking Arrangements shall constitute a satisfactory curing
of the adverse effects of a University Park Parking Privileges Reduction,
subject to the further provisions of this Section 8.9 below.
The Landlord hereby covenants and agrees that any University Park Parking
Privileges Reduction shall be made on a fair and equitable basis with respect to
all of the tenants in University Park. The Landlord shall, within one hundred
twenty (120) days of any fire, casualty
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or taking affecting parking facilities within University Park that results in a
University Park Parking Privileges Reduction, give the Tenant written notice
("Parking Notice") (i) describing to what extent the Landlord will be able to
provide Temporary Substitute Parking Arrangements that fulfill the requirements
of the immediately prior paragraph of this Section 8.9 and (ii) providing an
estimate of the likely duration of such University Park Parking Privileges
Reduction. The Landlord shall, in the Parking Notice, designate the number of
affected Parking Passes and the location of the substitute parking areas, and
cooperate with the Tenant to establish reasonably satisfactory terms for shuttle
bus transportation, as soon as reasonably possible following the occurrence of
an event resulting in a University Park Parking Privileges Reduction.
If the Landlord (i) does not, in the Parking Notice, make Temporary
Substitute Parking Arrangements within one hundred twenty (120) days of the
commencement of a University Park Parking Privileges Reduction that fulfill the
requirements of the first paragraph of this Section 8.9 with respect to at least
fifty percent (50%) of the Parking Passes to which the Tenant is entitled under
this Lease, (ii) specifies in the Landlord's estimate of the likely duration of
the University Park Parking Privileges Reduction that the period during which
the Tenant must suffer a reduction of more than fifty percent (50%) of its
Parking Passes (i.e., not replaced through Temporary Substitute Parking
Arrangements) will exceed one (1) year, or (iii) specifies in the Landlord's
estimate of the likely duration of the University Park Parking Privileges
Reduction that the period during which a University Park Parking Privileges
Reduction will exist will likely exceed twenty four (24) months, then the Tenant
shall have the right, exercisable upon written notice to the Landlord within
thirty (30) days after the Tenant receives the Parking Notice, to terminate this
Lease.
If the Tenant does not exercise its termination right, as aforesaid, then
the Landlord shall, to the extent practicable, proceed promptly after the
occurrence of a University Park Parking Privileges Reduction affecting the
Tenant to restore, or cause to be restored, sufficient parking areas in
University Park to permit the Tenant to have the number of Parking Passes
contemplated in EXHIBIT A to be able to be used in parking areas within
University Park. However, if the Landlord is unable to so restore the Tenant's
parking privileges within University Park within twenty four (24) months from
the date of the University Park Parking Privileges Reduction, then the Tenant
shall have the right to terminate this Lease by notice to the Landlord of its
desire to do so, provided such notice is given not later than thirty (30) days
after the Landlord notifies the Tenant as aforesaid.
The Tenant's termination rights set forth in this Section 8.9 shall be the
Tenant's sole remedy for the Landlord's inability to provide the parking
privileges contemplated under this Lease in the event of a casualty or taking
affecting parking in University Park, provided that the Landlord has complied
with its obligation to act on a fair and equitable basis. Any such termination
of this Lease by the Tenant, as aforesaid, shall be effective thirty (30) days
after notice is so given to the Landlord, or such later date specified by the
Tenant in such termination notice not exceeding one hundred eighty (180) days
after termination notice is given. Failure by the Tenant to timely exercise any
right to terminate this Lease under this Section 8.9 shall result in the waiver
by the Tenant of any such right to terminate this Lease.
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ARTICLE 9
DEFAULT
Section 9.1 TENANT'S DEFAULT. Each of the following shall constitute an
Event of Default:
(a) Failure on the part of the Tenant to pay the Annual Fixed Rent,
Additional Rent or other charges for which provision is made herein on or
before the date on which the same become due and payable, if such condition
continues for ten (10) days after written notice that the same are due.
(b) Failure on the part of the Tenant to perform or observe any other
term or condition contained in this Lease if the Tenant shall not cure such
failure within thirty (30) days after written notice from the Landlord to
the Tenant thereof, provided that in the case of breaches that are not
reasonably susceptible to cure within thirty (30) days through the exercise
of due diligence, then so long as the Tenant commences such cure within
thirty (30) days, and the Tenant diligently pursues such cure to
completion, such breach shall not be deemed to create an Event of Default.
(c) The taking of the estate hereby created on execution or by other
process of law; or a judicial declaration that the Tenant, or any guarantor
of this Lease, is bankrupt or insolvent according to law; or any assignment
of the property of the Tenant, or any guarantor of this Lease, for the
benefit of creditors; or the appointment of a receiver, guardian,
conservator, trustee in bankruptcy or other similar officer to take charge
of all or any substantial part of the property of Tenant, or any guarantor
of this Lease, by a court of competent jurisdiction, which officer is not
dismissed or removed within ninety (90) days; or the filing of an
involuntary petition against the Tenant, or any guarantor of this Lease,
under any provisions of the bankruptcy act now or hereafter enacted if the
same is not dismissed within ninety (90) days; the filing by the Tenant, or
any guarantor of this Lease, of any voluntary petition for relief under
provisions of any bankruptcy law now or hereafter enacted.
If an Event of Default shall occur, then, in any such case, whether or not
the Term shall have begun, the Landlord lawfully may, immediately or at any time
thereafter, give notice to the Tenant specifying the Event of Default and this
Lease shall come to an end on the date specified therein as fully and completely
as if such date were the date herein originally fixed for the expiration of the
Lease Term, and the Tenant will then quit and surrender the Premises to the
Landlord, but the Tenant shall remain liable as hereinafter provided.
Section 9.2 DAMAGES. In the event that this Lease is terminated, the Tenant
covenants to pay to the Landlord punctually all the sums ("Periodic Payments")
and perform all the obligations which the Tenant covenants in this Lease to pay
and to perform in the same manner
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and to the same extent and at the same time as if this Lease had not been
terminated, and all of the Landlord's expenses in connection with reletting the
Premises including, without limitation, all repossession costs, brokerage
commissions, fees for legal services and expenses of preparing the Premises for
such reletting. However, the Landlord may elect, at any time, to demand in lieu
of any further obligations to make Periodic Payments, and payments on account of
the Landlord's reletting costs thereafter accruing, as compensation, an amount
(the "Lump Sum Payment") equal to the excess, if any, of the discounted present
value of the total rent reserved for the then remainder of the Term over the
then discounted present fair rental value of the Premises for the then remainder
of the Term. The discount rate for calculating such sum shall be the then
current rate of United States Treasury securities having a maturity date as
close as possible to the end of the Term (had the Lease not been terminated). In
calculating the rent reserved, there shall be included, in addition to the
Annual Fixed Rent and all Additional Rent, the value of all other considerations
agreed to be paid or performed by the Tenant over the remainder of the Term.
In calculating the Periodic Payments to be made by the Tenant under the
foregoing covenant, the Tenant shall be credited with the net proceeds of any
rent obtained by reletting the Premises, after deducting all the Landlord's
expenses in connection with such reletting, including, without limitation, all
repossession costs, brokerage commissions, fees for legal services and expenses
of preparing the Premises for such reletting. The Landlord may (i) relet the
Premises, or any part or parts thereof, for a term or terms which may, at the
Landlord's option, exceed or be equal to or less than the period which would
otherwise have constituted the balance of the Term, and may grant such
concessions and free rent as the Landlord in its reasonable commercial judgment
considers advisable or necessary to relet the same and (ii) make such
alterations, repairs and improvements in the Premises as the Landlord in its
reasonable commercial judgment considers advisable or necessary to relet the
same. No action of the Landlord in accordance with foregoing or failure to relet
or to collect rent under-reletting shall operate to release or reduce the
Tenant's liability. The Landlord shall be entitled to seek to rent other
properties of the Landlord prior to reletting the Premises. Notwithstanding the
foregoing, the Landlord shall offer such Premises to lease in the same manner as
the Landlord offers other vacant space for lease in University Park.
Section 9.3 CUMULATIVE RIGHTS. The specific remedies to which either party
may resort under the terms of this Lease are cumulative and are not intended to
be exclusive of any other remedies or means of redress to which it may be
lawfully entitled in case of any breach or threatened breach by the other party
of any provisions of this Lease. In addition to the other remedies provided in
this Lease, each party shall be entitled to seek the restraint by injunction of
the violation or attempted or threatened violation of any of the covenants,
conditions or provisions of this Lease or to a decree compelling specific
performance of any such covenants, conditions or provisions. Nothing contained
in this Lease shall limit or prejudice the right of the Landlord to prove for
and obtain in proceedings for bankruptcy, insolvency or like proceedings by
reason of the termination of this Lease, an amount equal to the maximum allowed
by any statute or rule of law in effect at the time when, and governing the
proceedings in which, the
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damages are to be proved, whether or not the amount be greater, equal to, or
less than the amount of the loss or damages referred to above.
Section 9.4 LANDLORD'S SELF-HELP. If there shall be an Event of Default, or
if emergency circumstances should exist where, upon the giving of notice or
passage of time, such circumstances would constitute an Event of Default, then
the Landlord shall have the right, but not the obligation, after the giving by
the Landlord of notice thereof to the Tenant (except in case of emergency
circumstances in which case no prior notice need be given), to perform such
obligation. In the event the Landlord exercises its rights under this Section
9.4 in case of emergency, the Landlord shall notify the Tenant as soon as
reasonably possible after the taking of such action. The Landlord may exercise
its rights under this Section without waiving any other of its rights or
releasing the Tenant from any of its obligations under this Lease. The Tenant
shall be liable to the Landlord for all of the Landlord's reasonable costs
associated with effecting such cure.
Section 9.5 ENFORCEMENT EXPENSES; LITIGATION. Each party hereto shall
promptly reimburse the other for all costs and expenses, including without
limitation legal fees, incurred by such party in exercising and enforcing its
rights under this Lease following the other party's failure to comply with its
obligations hereunder, whether or not such failure constitutes an Event of
Default pursuant to Sections 9.1 or 9.7 hereof.
If either party hereto be made or becomes a party to any litigation
commenced by or against the other party by or against a third party, or incurs
costs or expenses related to such litigation, involving any part of the Property
and the enforcement of any of the rights, obligations or remedies of such party,
then the party becoming involved in any such litigation because of a claim
against such other party hereto shall receive from such other party hereto all
costs and reasonable attorneys' fees incurred by such party in such litigation.
Section 9.6 LATE CHARGES; INTEREST ON OVERDUE PAYMENTS.
(a) In the event that any payment of Annual Fixed Rent or Additional
Rent shall remain unpaid for a period of ten (10) days following notice by
the Landlord to the Tenant that such payment is overdue, there shall become
due to the Landlord from the Tenant, as Additional Rent and as compensation
for the Landlord's extra administrative costs in investigating the
circumstances of late rent, a late charge of two percent (2%) of the amount
overdue.
(b) Any Annual Fixed Rent and Additional Rent or other amount which is
due from either party to the other party which is not paid within ten (10)
days after the same is due and payable shall bear interest from the date
due until paid at the variable rate (the "Default Interest Rate") equal to
the annual rate from time to time announced by Fleet Bank as its base rate,
plus two percent (2%), or if such rate can no longer be determined, the
annual prime rate from time to time announced by THE WALL STREET JOURNAL,
plus two percent (2%).
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Section 9.7 LANDLORD'S RIGHT TO NOTICE AND CURE; TENANT'S SELF-HELP RIGHTS.
The Landlord shall in no event be in default in the performance of any of the
Landlord's obligations hereunder unless and until the Landlord shall have failed
to perform such obligations within thirty (30) days, or such additional time as
is reasonably required to correct any such default, after written notice by the
Tenant to the Landlord expressly specifying wherein the Landlord has failed to
perform any such obligation. If the Landlord has failed to make any repair which
results in a material risk of damage or injury to persons or property within the
Premises within thirty (30) days of such notice, or such additional time as is
required (provided the Landlord shall have commenced to undertake such repair
within thirty (30) days of such notice and then diligently prosecutes such
repair work) to make such repair, then the Tenant shall have the right, after
providing an additional ten (10) days' written notice to the Landlord, and any
Mortgagee and Ground Lessor, to perform such obligation so long as the same may
be done solely on the Property. Notwithstanding the foregoing, in the case of an
emergency, the Tenant shall have the right to perform any such obligation
without regard to the thirty (30) day notice period, so long as (a) the Tenant
makes a good faith attempt to notify the Landlord prior to taking such action
and (b) notifies the Landlord as soon as possible thereafter. The Landlord shall
be liable to the Tenant for all of the Tenant's reasonable costs associated with
effecting such cure, provided that in no event shall the Tenant be entitled to
abate any Annual Fixed Rent or Additional Rent or otherwise offset such costs
against sums due the Landlord under this Lease.
ARTICLE 10
MORTGAGEES' AND GROUND LESSORS' RIGHTS
Section 10.1 SUBORDINATION. This Lease shall be subject and subordinate to
any and all ground leases of the Property, and therefore the terms and
conditions of any such ground lease shall be superior to all rights hereby or
hereafter vested in the Tenant, subject however to Section 10.5 hereof. There
are no obligations imposed upon the Tenant under the ground lease except as
expressly set forth in this Lease. At the election of the holder of any mortgage
encumbering the Landlord's interest in the Property, which under this Lease
means the Landlord's leasehold interest under a ground lease, this Lease shall
be subject and subordinate to the lien of any mortgages thereon, so that the
rights of any such mortgagee shall be superior to all rights hereby or hereafter
vested in the Tenant, subject however to Section 10.5 hereof.
Section 10.2 PREPAYMENT OF RENT NOT TO BIND MORTGAGEE OR GROUND LESSOR. No
Annual Fixed Rent, Additional Rent (other than estimated monthly payments on
account of Additional Rent which the Tenant is required to pay pursuant to the
provisions of this Lease), or any other charge payable to the Landlord shall be
paid more than thirty (30) days prior to the due date thereof under the terms of
this Lease and payments made in violation of this provision shall (except to the
extent that such payments are actually received by a mortgagee or ground lessor)
be a nullity as against such mortgagee or ground lessor and the Tenant shall be
liable for the amount of such payments to such mortgagee or ground lessor.
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Section 10.3 TENANT'S DUTY TO NOTIFY MORTGAGEE AND GROUND LESSOR;
MORTGAGEE'S AND GROUND LESSOR'S ABILITY TO CURE. The Tenant hereby agrees that,
if the Tenant provides the Landlord with any notice of default or claimed
default on the part of the Landlord under the Lease, the Tenant shall
concurrently therewith send a copy of such notice to any mortgagee and ground
lessor of whom the Tenant has been given prior written notice ("Mortgagee" or
"Ground Lessor" as applicable). In such event, the Mortgagee and Ground Lessor
shall be permitted (but not obligated) to cure any such default. No act or
failure to act on the part of the Landlord which would entitle the Tenant under
the terms of this Lease, or by law, to be relieved of the Tenant's obligations
to pay Annual Fixed Rent or Additional Rent hereunder or to terminate this
Lease, shall result in a release or termination of such obligations of the
Tenant or a termination of this Lease unless (i) the Tenant shall have first
given written notice of the Landlord's act or failure to act to any Mortgagee
and Ground Lessor, specifying the act or failure to act on the part of the
Landlord which would give basis to the Tenant's rights; and (ii) no such
Mortgagee or Ground Lessor, after receipt of such notice, shall have corrected
or cured the condition complained of within a reasonable time thereafter (which
shall include a reasonable period of time for such mortgagee or ground lessors,
not to exceed thirty (30) days after receipt of such notice, to obtain
possession of the Property if possession is necessary for the mortgagee or
ground lessor to correct or cure the condition and if the mortgagee or ground
lessor notifies the Tenant of its intention to take possession of the Property
and correct or cure such condition).
Section 10.4 ESTOPPEL CERTIFICATES. The Tenant shall from time to time,
upon not less than fifteen (15) days' prior written request by the Landlord,
execute, acknowledge and deliver to the Landlord a statement in writing
certifying to the Landlord or an independent third party, with a true and
correct copy of this Lease attached thereto, to the extent such statements
continue to be true and accurate, (i) that this Lease is unmodified and in full
force and effect (or, if there have been any modifications, that the same is in
full force and effect as modified and stating the modifications); (ii) that the
Tenant has no knowledge of any defenses, offsets or counterclaims against its
obligations to pay the Annual Fixed Rent and Additional Rent and to perform its
other covenants under this Lease (or if there are any defenses, offsets, or
counterclaims, setting them forth in reasonable detail); (iii) that there are no
known uncured defaults of the Landlord or the Tenant under this Lease (or if
there are known defaults, setting them forth in reasonable detail); (iv) the
dates to which the Annual Fixed Rent, Additional Rent and other charges have
been paid; (v) that the Tenant has (if true) accepted, is satisfied with, and is
in full possession of the Premises, including all improvements, additions and
alterations thereto required to be made by Landlord under the Lease; (vi) that
(if true) the Landlord has satisfactorily complied with all of the requirements
and conditions precedent to the occurrence of the Rent Commencement Date with
respect to the entire Building; (vii) that (if true) the Tenant has been in
occupancy since the Rent Commencement Date and paying rent since the specified
dates; (viii) that no monetary or other considerations, including, but not
limited to, rental concessions for Landlord, special tenant improvements or
Landlord's assumption of prior lease obligations of Tenant have been granted to
Tenant by Landlord for entering into Lease, except as set forth in this Lease or
as otherwise specified in such estoppel; (ix) that (if true) the Tenant has no
notice of a prior assignment, hypothecation, or pledge of rents or of the Lease;
(x) that the Lease represents the entire agreement between Landlord and Tenant;
(xi) that any notice to Tenant may be given it by
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certified or registered mail, return receipt requested, or delivered, at the
Premises, or at another address specified; and (xii) such factual other matters
with respect to the Tenant and this Lease as the Landlord may reasonably
request. On or following the Rent Commencement Date, the Tenant shall, within
ten (10) days after receipt of Landlord's request therefor, promptly execute,
acknowledge and deliver to the Landlord a statement in writing that the Rent
Commencement Date has occurred, that the Annual Fixed Rent has begun to accrue
with respect thereto, and that the Tenant has taken occupancy of such portion of
the Premises. Any statement delivered pursuant to this Section may be relied
upon by any prospective purchaser, mortgagee or ground lessor of the Premises or
any interest therein, and shall be binding on the Tenant.
Landlord shall from time to time, upon not less than fifteen (15) days'
prior written request by the Tenant, execute, acknowledge and deliver to the
Tenant a statement in writing certifying to the Tenant or an independent third
party, with a true and correct copy of this Lease attached thereto, to the
extent such statements continue to be true and accurate (i) that this Lease is
unmodified and in full force and effect (or, if there have been any
modifications, that the same is in full force and effect as modified and stating
the modifications); (ii) that the Landlord has no knowledge of any defenses,
offsets or counterclaims against its obligations to perform its covenants under
this Lease (or if there are any defenses, offsets, or counterclaims, setting
them forth in reasonable detail); (iii) that there are no known uncured defaults
of the Tenant or the Landlord under this Lease (or if there are known defaults,
setting them forth in reasonable detail); (iv) the dates to which the Annual
Fixed Rent, Additional Rent and other charges have been paid; (v) that the
Tenant is in full possession of the Premises; (vi) that Landlord has no notice
of a prior assignment of the Lease or sublease of space therein; (vii) that the
Lease represents the entire agreement between Landlord and Tenant; (viii) that
any notice to Landlord may be given if by certified or registered mail, return
receipt requested, or delivered to the Landlord's address listed on EXHIBIT A,
or at another address specified; and (xii) such other factual matters with
respect to the Tenant and this Lease as the Tenant may reasonably request. Any
statement delivered pursuant to this Section may be relied upon by any
prospective assignee or sublessee of Tenant and shall be binding on the
Landlord.
Section 10.5 SUBORDINATION, NONDISTURBANCE AND ATTORNMENT AGREEMENTS. The
subordination of the Tenant's rights under this Lease to ground lessors and
mortgagees now existing or hereafter granted, as contemplated in Section 10.1,
is subject to the condition that any such mortgagee or ground lessor shall have
entered into a subordination, nondisturbance and attornment agreement with the
Tenant, the form of which shall be furnished by the mortgagee or ground lessor,
as the case may be, with such reasonable modifications as Tenant shall request
within a reasonable time period. The form of non-disturbance and attornment
agreement attached hereto as EXHIBIT G is acceptable to Tenant in connection
with the Ground Lease held by MIT (as such terms are defined in Section 12.10).
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ARTICLE 11
SECURITY DEPOSIT
Section 11.1 Concurrently with the Landlord's having closed on its
construction financing for the Building, the Tenant shall deposit with the
Landlord, and thereafter throughout the Term, the Tenant shall maintain with the
Landlord, a security deposit (the "Lease Security Deposit") equal to the product
of (i) six (6) times (ii) the aggregate of (a) the average monthly installment
of Annual Fixed Rent payable by the Tenant to the Landlord over the entire
Initial Term of this Lease or, if applicable, the average monthly installment of
Annual Fixed Rent payable with respect to the then current Extension Term, (b)
the Landlord's reasonable estimate of the average monthly installment of the
Tenant's Tax Expenses Allocable to the Premises over the entire Initial Term or,
if applicable, the then current Extension Term and (c) the Landlord's reasonable
estimate of the average monthly installment of Operating Expenses for the
Property over the entire Initial Term or, if applicable, the then current
Extension Term. The Landlord may draw upon any letter of credit (if deposited as
a letter of credit) and apply such deposit, including all interest thereon
accrued but not yet paid to the Tenant, as provided in this Article 11, upon any
Event of Default by the Tenant hereunder. Provided there is no then subsisting
default by the Tenant under this Lease with respect to which the Landlord has
given the Tenant notice, and thereafter only at such time as there is no such
default by the Tenant then subsisting: (i) on each anniversary of the date upon
which the Rent Commencement Date has occurred with respect to the entire
Original Premises, all interest which shall have theretofore accrued on the
Lease Security Deposit shall be disbursed to Tenant and (ii) within thirty (30)
days after the expiration of this Lease, any remaining portion of the Lease
Security Deposit not theretofore applied shall be disbursed to Tenant. However,
upon any termination of this Lease the Lease Security Deposit
(The remainder of this page is intentionally left blank.)
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may first be applied by the Landlord to any amounts for which the Tenant is
liable under this Lease. In the event the Landlord draws down on any letter of
credit or applies any funds constituting the Lease Security Deposit, the Tenant
shall deliver to the Landlord as Additional Rent, within ten (10) days after
invoice therefor, either a replacement or supplemental letter of credit, or the
amount of the Lease Security Deposit applied by the Landlord, such that the
balance of the Lease Security Deposit shall be restored to the appropriate
amount specified herein. Failure by the Tenant to timely make the Lease Security
Deposit shall constitute a condition to the effectiveness of this Lease, failure
of which to be timely satisfied by the Tenant shall entitle the Landlord to
terminate this Lease.
Section 11.2 The Lease Security Deposit may be made and maintained by the
Tenant, at its election, either in the form of a clean, unconditional and
irrevocable letter of credit in form and substance satisfactory in all respects
to the Landlord, and from a commercial bank having an AA rating by Standard and
Poors or from an institution that is a wholly owned subsidiary of a bank having
an AA rating by Standard and Poors or in cash. If and to the extent the Lease
Security Deposit is held in the form of a letter of credit, the Landlord may
pledge its right, title and interest in and to such letter of credit to any
mortgagee or ground lessor and, in order to perfect such pledge, have such
letter of credit held in escrow by such mortgagee or ground lessee. If and to
the extent the Lease Security Deposit is held in the form of cash, the Landlord
may pledge its right and interest in and to such cash to any mortgagee or ground
lessor and, in order to perfect such pledge, have such cash held in escrow by
such mortgagee or ground lessee or grant such mortgagee or ground lessee a
security interest therein. In connection with any such pledge or grant of
security interest by the Landlord to a mortgagee or ground lessee ("Security
Deposit Pledgee"), Tenant covenants and agrees to cooperate as reasonably
requested by the Landlord, in order to permit the Landlord to implement the same
on terms and conditions reasonably required by such mortgagee or ground lessee
including, without limitation, providing in any letter of credit that the Tenant
elects to give under this Article 11 any necessary and appropriate language that
will permit the implementation of such pledge. If and to the extent the Lease
Security Deposit is hereafter held in the form of cash, and whether or not a
Security Deposit Pledgee shall have a security interest therein, such cash shall
be deposited in a separately maintained and accounted escrow account established
with a bank or other financial institution reasonably acceptable to the Tenant
(the "Escrow Holder"). The Tenant agrees that any Security Deposit Pledgee may
be the Escrow Holder so long as the Security Deposit Pledgee is a bank or other
financial institution. The Landlord and the Tenant agree that a separate
three-party escrow agreement, in form and substance satisfactory to the
Landlord, the Tenant and the Escrow Holder, will be entered into prior to the
date upon which the Tenant may deposit any such sums in cash, and the Tenant
agrees to reasonably cooperate from time to time as requested by the Landlord in
order to effectuate the holding of any cash amount comprising a portion of the
Lease Security Deposit by the Escrow Holder in accordance with terms and
conditions reasonably required by such Escrow Holder. Notwithstanding anything
in this Lease to the contrary, the Lease Security Deposit shall at all times
constitute the property of the Tenant and title to the Security Deposits shall
remain with the Tenant. To the extent, if any, the Security Deposits are deemed
to be held by the Landlord they shall be deemed to be held in trust for the
benefit of the Tenant, in all cases, subject however to the Landlord's rights
pursuant to this Article 11.
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Section 11.3 The Lease Security Deposit shall be immediately increased by
the Tenant to two (2) times the amount specified in Section 11.2 in the event
that either (i) the Tenant's Consolidated Net Available Cash falls below Twenty
Five Million Dollars ($25,000,000) or (ii) the Tenant's Net Working Capital
falls below Ten Million Dollars ($10,000,000); provided, however, if the
Tenant's Consolidated Net Available Cash thereafter rises to a level above
Twenty Five Million Dollars ($25,000,000) or the Tenant's Net Working Capital
rises to a level above an amount equal to Ten Million Dollars ($10,000,000) for
six (6) consecutive months, the Tenant shall be entitled to the reduction of the
Lease Security Deposit back to the amount specified in Section 11.2 within
thirty (30) days after the end of such six (6) month period. For purposes of
this Lease, the Tenant's "Consolidated Net Available Cash" shall be the sum of
the Tenant's (A) cash and cash equivalents and (B) marketable securities as
reported on the consolidated balance sheets contained in the Tenant's quarterly
reports on Form 10-Q and Annual Report on Form 10-K. For purposes of this Lease,
the Tenant's "Net Working Capital" shall mean current assets minus current
liabilities, as reported on the consolidated balance sheets contained in the
Tenant's quarterly reports on Form 10-Q and the Annual Report on Form 10-K. The
Tenant shall provide the Landlord with such reports as soon as practicable but
in no case later than five (5) business days following the filing of same with
the Securities and Exchange Commission. The Tenant shall promptly notify the
Landlord in the event that (A) the Tenant's Consolidated Net Available Cash
falls below Twenty Five Million Dollars ($25,000,000) or (B) the Tenant's Net
Working Capital falls below Ten Million Dollars ($10,000,000). The Tenant shall
be required to provide quarterly reporting of its Consolidated Net Available
Cash during any quarterly period following a quarter in which Tenant's
Consolidated Net Available Cash is less than Thirty Five Million Dollars
($35,000,000) or Tenant's Net Working Capital is less than Twenty Million
Dollars ($20,000,000) unless the Tenant is in default under this Lease of which
fact the Landlord has given the Tenant notice, in which case, during the
pendency of any such default, reports shall be made to the Landlord on a monthly
basis.
ARTICLE 12
MISCELLANEOUS
Section 12.1 NOTICE OF LEASE. The Tenant agrees not to record this Lease,
but upon request of either party, both parties shall execute and deliver a
memorandum of this Lease in form appropriate for recording or registration, an
instrument acknowledging the Commencement Date of the Term, and if this Lease is
terminated before the Term expires, an instrument in such form acknowledging the
date of termination.
Section 12.2 NOTICES. Whenever any notice, approval, consent, request,
election, offer or acceptance is given or made pursuant to this Lease, it shall
be in writing. Communications and payments shall be addressed, if to the
Landlord, at the Landlord's Address for Notices as set forth in EXHIBIT A or at
such other address as may have been specified by prior notice to the Tenant; and
if to the Tenant, at the Tenant's Address or at such other place as may have
been specified by prior notice to the Landlord. Any communication so addressed
shall be deemed
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duly given on the earlier of (i) the date received, or (ii) on the next business
day if sent by a nationally recognized overnight courier service. If the
Landlord by notice to the Tenant at any time designates some other person to
receive payments or notices, all payments or notices thereafter by the Tenant
shall be paid or given to the agent designated until notice to the contrary is
received by the Tenant from the Landlord.
Section 12.3 SUCCESSORS AND LIMITATION ON LIABILITY. The obligations of
this Lease shall run with the land, and this Lease shall be binding upon and
inure to the benefit of the parties hereto and their respective successors and
assigns, except that the original Landlord named herein and each successor
Landlord shall be liable only for obligations accruing during the period of its
ownership. Neither the Tenant, nor anyone claiming by, under or through the
Tenant, shall be entitled to obtain any judgment in enforcing the terms and
conditions of this Lease creating personal liability on the part of the Landlord
or enforcing any obligations of the Landlord against any assets of the Landlord
other than its interest in the Property and, without limitation of the
foregoing, in no event shall any personal liability arise on the part of any of
the Landlord's officers, employees, directors or shareholders. Likewise, no
personal liability shall arise on the part of the Tenant's officers, employees,
directors or shareholders, as this Lease shall create liability on the part of
the Tenant and not personal liability on the part of such officers, employees,
directors or shareholders.
Section 12.4 WAIVERS. The failure of the Landlord or the Tenant to seek
redress for violation of, or to insist upon strict performance of, any covenant
or condition of this Lease, shall not be deemed a waiver of such violation nor
prevent a subsequent act, which would have originally constituted a violation,
from having all the force and effect of an original violation. The receipt by
the Landlord of Annual Fixed Rent or Additional Rent with knowledge of the
breach of any covenant of this Lease shall not be deemed a waiver of such
breach. No provision of this Lease shall be deemed to have been waived by the
Landlord or the Tenant, as the case may be, unless such waiver be in writing
signed by the Landlord or the Tenant, as the case may be. No consent or waiver,
express or implied, by the Landlord or Tenant to or of any breach of any
agreement or duty shall be construed as a waiver or consent to or of any other
breach of the same or any other agreement or duty.
Section 12.5 ACCEPTANCE OF PARTIAL PAYMENTS OF RENT. No acceptance by
either party of a lesser sum than the amount then due to such party shall be
deemed to be other than a partial installment of such rent due, nor shall any
endorsement or statement on any check or any letter accompanying any check or
payment as rent be deemed an accord and satisfaction, and either party may
accept such check or payment without prejudice to the other party's right to
recover the balance of such installment or pursue any other remedy in this Lease
provided. The delivery of keys to any employee of the Landlord or to the
Landlord's agent or any employee thereof shall not operate as a termination of
this Lease or a surrender of the Premises.
Section 12.6 INTERPRETATION AND PARTIAL INVALIDITY. If any term of this
Lease, or the application thereof to any person or circumstances, shall to any
extent be invalid or unenforceable, the remainder of this Lease, or the
application of such term to persons or
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circumstances other than those as to which it is invalid or unenforceable, shall
not be affected thereby, and each term of this Lease shall be valid and
enforceable to the fullest extent permitted by law. The titles of the Articles
are for convenience only and not to be considered in construing this Lease. This
Lease contains all of the agreements of the parties with respect to the subject
matter thereof and supersedes all prior dealings between them with respect to
such subject matter.
Section 12.7 QUIET ENJOYMENT. So long as the Tenant pays Annual Fixed Rent
and Additional Rent, performs all other Tenant covenants of this Lease and
observes all conditions hereof, the Tenant shall peaceably and quietly have,
hold and enjoy the Premises free of any claims by, through or under, or superior
title to, the Landlord including, without limitation, any Ground Lessor or
manager exercising rights under the Declaration of Covenants.
Section 12.8 BROKERAGE. Each party represents and warrants to the other
that it has had no dealings with any broker or agent other than Meredith & Grew,
Incorporated (the "Broker") in connection with this Lease and shall indemnify
and hold harmless the other from claims for any brokerage commission (other than
by the Broker) arising out a breach of the foregoing representations. Landlord
shall be responsible for any commission due to the Broker pursuant to the terms
of a separate agreement.
Section 12.9 SURRENDER OF PREMISES AND HOLDING OVER. The Tenant shall
surrender possession of the Premises on the last day of the Term and the Tenant
waives the right to any notice of termination or notice to quit at the end of
the Term. The Tenant covenants that upon the expiration or sooner termination of
this Lease, it shall, without notice, deliver up and surrender possession of the
Premises in the same condition in which the Tenant has agreed to keep the same
during the continuance of this Lease and in accordance with the terms hereof,
normal wear and tear and damage by fire or other casualty excepted, first
removing therefrom all goods and effects of the Tenant and any leasehold
improvements Landlord specified for removal pursuant to Section 4.2, and
repairing all damage caused by such removal. Upon the expiration of this Lease
or if the Premises should be abandoned by the Tenant, or this Lease should
terminate for any cause, and at the time of such expiration, vacation,
abandonment or termination, the Tenant or Tenant's agents, subtenants or any
other person should leave any property of any kind or character on or in the
Premises after having vacated the Premises, the fact of such leaving of property
on or in the Premises shall be conclusive evidence of intent by the Tenant, and
individuals and entities deriving their rights through the Tenant, to abandon
such property so left in or upon the Premises, and such leaving shall constitute
abandonment of the property. Landlord shall have the right and authority without
notice to the Tenant or anyone else, to remove and destroy, or to sell or
authorize disposal of such property, or any part thereof, without being in any
way liable to the Tenant therefor and the proceeds thereof shall belong to the
Landlord as compensation for the removal and disposition of such property.
Without limitation of the foregoing, the Tenant's surrender obligations
shall include the construction of a new floor in the "depressed slab" portion of
the first floor (as such area is identified on EXHIBIT B-1) so that the finished
floor (exclusive of loading dock area) is at the
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same elevation as the balance of the first floor. The Tenant's construction
shall be carried out in accordance with plans and specifications provided by the
Landlord's architect and/or structural engineer, and the new floor constructed
by the Tenant as aforesaid shall be capable of carrying the same load as what
such area of the first floor slab would otherwise have been able to carry had
there been no such depressed slab. In addition, the Tenant shall replace the
louvers in the masonry openings adjacent to the "depressed slab," and in the
openings on the third floor where the air handling equipment that the Tenant
intends to remove is located, with glazed windows to match the others in the
Building. Unless and to the extent waived in writing by the Landlord which the
Landlord will do if a successor tenant of the Premises desires to take the
depressed slab "as is," the completion of all of the foregoing work, and the
Tenant's substantiation to the Landlord of the Tenant's payment therefor,
accompanied by lien waivers and other documentation reasonably required by the
Landlord, shall constitute conditions to the surrender of the Premises in
accordance with the requirements of this Lease.
If the Tenant fails to surrender possession of the Premises upon the
expiration or sooner termination of this Lease, the Tenant shall pay to
Landlord, as rent for any period after the expiration or sooner termination of
this Lease an amount equal to one hundred fifty percent (150%) of the Annual
Fixed Rent and the Additional Rent required to be paid under this Lease as
applied to any period in which the Tenant shall remain in possession. Acceptance
by the Landlord of such payments shall not constitute a consent to a holdover
hereunder or result in a renewal or extension of the Tenant's rights of
occupancy. Such payments shall be in addition to and shall not affect or limit
the Landlord's right of re-entry, Landlord's right to collect such damages as
may be available at law, or any other rights of the Landlord under this Lease or
as provided by law.
Section 12.10 GROUND LEASE. The Land is owned by the Massachusetts
Institute of Technology ("MIT"). MIT as lessor and the Landlord as lessee (or a
limited partnership of which the Landlord would be the general partner (the
"Limited Partnership") and to whom all of the Landlord's rights and obligations
under this Lease may be assigned in the Landlord's sole discretion) shall enter
into a ground lease (the "Ground Lease") of the Land, and this Lease shall in
all respects be subject to such Ground Lease. If the Ground Lease shall
terminate during the Term for any reason whatsoever, except as may otherwise be
agreed between MIT and the Tenant, this Lease shall terminate with the same
force and effect as if such termination date had been named herein as the date
of expiration hereof. However, this Lease is subject to the execution by MIT,
the Tenant and the Landlord of a non-disturbance agreement in the form attached
hereto as EXHIBIT G. Each party shall pay its own expenses related to such
non-disturbance agreement. The Landlord represents and warrants to the Tenant
that, upon execution of the Ground Lease by the Landlord, or upon assignment of
this Lease to the Limited Partnership and the execution of the Ground Lease by
the Limited Partnership, the Landlord or the Limited Partnership, as the case
may be, shall have the full right and authority to grant the estate demised
herein and the appurtenant rights granted herein.
Section 12.11 FINANCIAL REPORTING. Tenant shall from time to time (but not
less frequently than quarterly) provide Landlord with financial statements of
Tenant, together with
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related statements of Tenant's operations for Tenant's most recent fiscal year
then ended, certified by an independent certified public accounting firm.
Notwithstanding the foregoing, so long as the Tenant is a public company, it
shall be in compliance with its financial reporting obligations provided that it
submits, upon request by the Landlord, all 10-Q and 10-K reports to the Landlord
within ten (10) business days of filing the same with the Securities and
Exchange Commission.
Section 12.12 CAMBRIDGE EMPLOYMENT PLAN. The Tenant agrees to sign an
agreement with the Employment and Training Agency designated by the City Manager
of the City of Cambridge as provided in subsections (a)-(g) of Section 24-4 of
Ordinance Number 1005 of the City of Cambridge, adopted April 23, 1984.
Section 12.13 TRUCK DELIVERY ROUTES; TRAFFIC MITIGATION MEASURES. Tenant
agrees to exercise good faith efforts to cooperate with any efforts by the City
of Cambridge to direct truck traffic to certain streets and away from certain
other streets, in connection with the making of deliveries to the Premises, and
to comply with any traffic mitigation measures of the City of Cambridge
applicable to the Building, and Tenant shall otherwise comply with all legal
requirements of the City of Cambridge pertaining thereto.
Section 12.14 PARKING AND TRANSPORTATION DEMAND MANAGEMENT. Tenant
covenants and agrees to work cooperatively with Landlord to develop a parking
and transportation demand management ("PTDM") program that comprises part of a
comprehensive PTDM for University Park. In connection therewith, the use of
single occupant vehicle commuting will be discouraged and the use of alternative
modes of transportation and/or alternative work hours will be promoted. Without
limitation of the foregoing, Tenant agrees that its PTDM program (and Tenant
will require in any sublease or occupancy agreement permitting occupancy in the
Premises that such occupant's PTDM program) will include offering a subsidized
MBTA transit pass, either constituting a full subsidy or a subsidy in an amount
equal to the maximum deductible amount therefor allowed under the federal tax
code, to any employee working in the Premises requesting one. The Tenant agrees
additionally to comply with any other requirements of the City of Cambridge or
other governmental authorities associated with parking or transportation
management that are now in effect or hereafter adopted.
Section 12.15 LABORATORY ANIMALS. The Landlord acknowledges that the Tenant
will be conducting biotechnology research and development at the Premises and as
such may require the use of certain laboratory animals at the Premises in order
to carry out such research and development.
Section 12.16 NO CONSEQUENTIAL DAMAGES. In no event shall either Landlord
or Tenant be liable to the other for consequential damages, provided that
damages incurred by the Landlord in connection with any holding over by Tenant
in the Premises, including without limitation those associated with loss, cost,
liability or expense arising by virtue of the existence of aggrieved third
parties (e.g. lenders and prospective tenants), shall not constitute
consequential damages.
48
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Section 12.17 GOVERNING LAW. This Lease shall be governed by and construed
in accordance with the laws of the Commonwealth of Massachusetts.
(The remainder of this page is intentionally left blank)
49
<PAGE> 55
IN WITNESS WHEREOF, this Lease has been executed and delivered as of the
date first above written as a sealed instrument.
LANDLORD:
FC 88 SIDNEY, INC.
By: /s/ Gayle B. Farris
------------------------------
Gayle B. Farris
Vice President
TENANT:
ALKERMES, INC.
By: /s/ James M. Frates
------------------------------
Title: Vice President
---------------------------
50
<PAGE> 56
EXHIBIT A
BASIC LEASE TERMS
Annual Fixed Rent
for the Initial Term: - Lease Years One (1) through Five (5): $46.10
per rentable square foot.
- Lease Years Six (6) through Ten (10): $48.10
per rentable square foot.
Fixed Rent Credit for
First Lease Year: Tenant shall be entitled to a credit against
Annual Fixed Rent with respect to the First Lease
Year equal to $41,666.67 per month.
Initial Term: Approximately ten (10) years and eight (8) months
(subject to the provisions of Section 2.5),
commencing on the Commencement Date, and expiring
on the day ("Termination Date") which is the last
day of the month during which the tenth (10th)
anniversary of the Rent Commencement Date occurs.
Extension Options: Tenant shall have options to extend the Initial
Term of this Lease for two (2) additional periods
of ten (10) years each, all as described in Section
2.6 of the Lease.
Landlord's Original
Address: FC 88 Sidney, Inc.
1130 Terminal Tower
50 Public Square
Cleveland, Ohio 44113-2203
Attention: James Ratner
Landlord's Address for
Notices: FC 88 Sidney, Inc.
38 Sidney Street
Cambridge, Massachusetts 02139-4234
Attention: Gayle B. Farris
A-1
<PAGE> 57
With a copy to:
Forest City Commercial Management
38 Sidney Street
Cambridge, Massachusetts 02139-4234
Attention: General Manager
Premises: Approximately 145,275 rentable square feet
("rsf"), comprising all of the rentable square
feet contained in the Building, subject to the
terms and conditions of this Lease, as depicted
on EXHIBIT B-1. If a bridge connection to the
building now known as the Richards Building
having an address of 64 Sidney Street should be
included in Landlord's Work, as established under
the Work Letter, then such bridge connection
shall comprise a portion of the Premises and the
rsf of such bridge connection shall be included
in the rsf of the Premises. The rsf of the
Premises shall be determined in accordance with
the final Base Building Plans and Specs (as
defined in the Work Letter), and only if there is
a change affecting the Base Building Improvements
and modifying the rentable floor area of the
Premises, shall there be any further
remeasurement ("Final Remeasurement") of the
Premises, in which case Landlord shall deliver a
statement from the Landlord's architect setting
forth the rentable floor area of the Premises as
computed in accordance with EXHIBIT F. Such
statement shall be subject to the Tenant's review
and reasonable approval.
Parking Privileges: During the Term, Landlord shall cause to be
provided to Tenant 1.5 parking passes per 1,000
rentable square feet of the Premises, provided
that the Landlord shall not provide fractional
parking passes (each a "Parking Pass"), each of
which shall entitle the parking of a single motor
vehicle in an unreserved parking space in
University Park, the charges for which shall
equal the Market Rate Parking Charge per Parking
Pass. If there is any Final Remeasurement that
adjusts the rentable square footage of the
Premises, the number of Parking Passes will be
modified if necessary to furnish the Tenant
with 1.5 parking passes per 1,000 rentable square
feet of the Premises, provided that the Landlord
shall not provide fractional Parking Passes. Such
parking spaces shall be accessible twenty four
(24) hours per day, seven (7) days per week. In
no event are Parking Passes transferable other
than to the holder, from time to time, of the
Tenant's interest under this Lease or a subtenant
that has been demised all or a portion of the
Premises in conformity with the requirements of
this Lease, and is limited to use by employees of
either of the foregoing. If the
A-2
<PAGE> 58
Tenant requests additional Parking Passes, and at
the time in question there are surplus Parking
Passes that are not committed to others, then
they may be made available by the Landlord, on a
month-to-month basis, subject to availability.
Permitted Uses: General business and administrative offices,
research and development and customary accessory
uses supporting the foregoing, all as defined by
and as permitted under the Zoning Ordinances of
the City of Cambridge.
Commencement Date: See Section 2.5.
Scheduled Rent
Commencement Date: May 1, 2002.
Rent Commencement Date: See Section 2.5.
Tenant's Address: Alkermes, Inc.
64 Sidney Street
Cambridge, MA 02139-4211
Attention: James M. Frates,
Chief Financial Officer
With copies to:
Ballard Spahr Andrews & Ingersoll, LLP
1735 Market Street, 51st Floor
Philadelphia, PA 19103-7599
Attention: Michael D. Silbert, Esq.
A-3
<PAGE> 59
EXHIBIT B
LEGAL DESCRIPTION
B-1
<PAGE> 60
EXHIBIT B-1
DEPICTION OF PREMISES
B-1-1
<PAGE> 61
EXHIBIT B-2
MAP OF UNIVERSITY PARK
B-2-1
<PAGE> 62
EXHIBIT C
WORK LETTER
88 Sidney Street
Cambridge, Massachusetts
LANDLORD
================================================================================
FC 88 SIDNEY, INC.
TENANT
================================================================================
ALKERMES, INC.
Dated: October 26, 2000
<PAGE> 63
TABLE OF CONTENTS
Page
----
ARTICLE 1
Definitions...................................................................1
ARTICLE 2
Engagement of Architect and Engineers; and
Tenant's and Landlord's Representative........................................3
ARTICLE 3
Base Building
Plans and Specifications......................................................4
ARTICLE 4
TI Plans and Specifications...................................................6
ARTICLE 5
Engagement of Contractor......................................................7
ARTICLE 6
Construction of the Base Building Improvements................................8
ARTICLE 7
Construction of the Leasehold Improvements....................................9
ARTICLE 8
Changes in the Work..........................................................10
ARTICLE 9
Indemnity; Insurance.........................................................11
ARTICLE 10
Cooperation..................................................................14
ARTICLE 11
Payment of Costs; Leasehold Improvements Allowance...........................14
ARTICLE 12
Substantial Completion; Delays...............................................17
ARTICLE 13
Completion of Basic Building Improvements; Punch List........................19
(i)
<PAGE> 64
ARTICLE 14
Arbitration..................................................................20
ARTICLE 15
Construction Security........................................................21
ARTICLE 16
Lease Termination Rights.....................................................23
ARTICLE 17
Rent Abatement Associated with Landlord's Failure to Timely
Achieve Substantial Completion of Base Building Improvements.................24
Schedule C1: List of Base Building Design Development
Plans and Specs
Schedule C2: Project Work Allocation
Schedule C3: Design and Construction Commencement Schedule
Schedule C4: Rules and Regulations for Tenant Construction
Schedule C5: Form of Construction Guaranty for Lender
(ii)
<PAGE> 65
EXHIBIT C
WORK LETTER
All capitalized terms used herein and not otherwise defined shall have the
meaning ascribed to said terms in the Lease to which this Work Letter is
attached as EXHIBIT C. This Work Letter is expressly subject to the provisions
of the Lease and supplements the Lease. The provisions herein should be read
consistently with the Lease, provided, however, in the event of any
inconsistency between this Work Letter and the Lease, the terms and conditions
of the Lease shall, in all instances, and for all purposes, control.
ARTICLE 1
DEFINITIONS
Section 1.1 DEFINITIONS. The following terms shall have the meanings
indicated or referred to below:
"Base Building Architect" means Elkus/Manfredi Architects, Ltd. (or
replacement therefor in accordance with Article 2).
"Base Building Design Development Plans and Specs" means the design
development plans and outline specifications prepared by the Base Building
Architect for the Base Building Improvements identified on SCHEDULE C1.
"Base Building Plans and Specs" -- See Section 3.1.
"Base Building Improvements" means the base building shell and core, base
building mechanical systems and site work contemplated by the Project Work
Allocation and the Base Building Plans and Specs.
"Building Standards" means the essential qualities associated with the Base
Building Improvements specified in the Project Work Allocation including,
without limitation, quality of materials and capacity and performance of
building systems.
"Building Weathertight Date" - See Section 6.3.
"Civil Engineer" means SEA Consultants, Inc.
"Construction Period" means the period commencing with Landlord's
commencement of construction of the Base Building Improvements and ending on the
day immediately prior to the Rent Commencement Date (as that term is defined in
Section 1.2 of the Lease).
<PAGE> 66
"Construction Progress Schedule" -- See Section 6.2.
"Contractor" means the general contractor mutually selected by Landlord and
Tenant as contemplated by Article 5 (or replacement therefor in accordance with
Section 5.3).
"Design and Construction Commencement Schedule" -- See Section 3.1.
"Developer's Administrative Fee" means a fee of Fifty Thousand and 00/100
Dollars ($50,000.00), to be charged against the Leasehold Improvement Allowance
by Forest City Development for construction administration services, in the
manner, and subject to the terms and conditions, described in Section 7.4.
"Eligible Leasehold Improvement Expenses" -- See Section 11.3.
"Excusable Delay" means any delay in the satisfaction of the conditions in
question to the extent the same is a consequence of External Causes including,
without limitation, any governmental embargo restrictions, or actions or
inactions of local, state or federal governments (such as, without limitation,
any delays in issuing building permits, certificates of occupancy or other
similar permits or certificates).
"Landlord Delay" -- See Section 12.4.
"Leasehold Improvements" means the initial build-out of the entire Premises
into a first class biotechnology research and development laboratory and office
facility as contemplated by the Project Work Allocation and the TI Plans and
Specs.
"Leasehold Improvements Allowance" -- See Section 11.1.
"Leasehold Improvements Cost Budget" -- See Section 7.1.
"Lighting Consultant" means Joe Kaplan Architectural Lighting.
"MEP Engineer" means AHA Consulting.
"Project Work Allocation" means the schedule denoting aspects of the Base
Building Improvements and the Leasehold Improvements and the allocation thereof
to either Landlord or Tenant (or partially to Landlord and the balance to
Tenant) attached hereto as SCHEDULE C2.
"Steel Frame Completion Date"-- See Section 6.3.
"Structural Engineer" means McNamara Salvia.
"Substantial Completion" -- See Section 12.1.
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"Tenant Base Building Change Order" -- See Section 8.1.
"Tenant Leasehold Improvement Change Order" -- See Section 8.5.
"Tenant Delay" -- See Section 12.3.
"Tenant's Architect" means the architect selected by Tenant in accordance
with Article 2 (or replacement therefor in accordance with Section 2.1).
"TI Plans and Specs" means the plans, specifications and working drawings
for the completion of the Leasehold Improvements approved by Landlord as herein
provided, as the same may be modified consistently with the terms and conditions
hereof.
ARTICLE 2
ENGAGEMENT OF ARCHITECT AND ENGINEERS; AND
TENANT'S AND LANDLORD'S REPRESENTATIVE
Section 2.1 Landlord has engaged the Base Building Architect to develop
design development plans, drawings and specifications for the Base Building
Improvements. Tenant shall hereafter engage the Tenant's Architect to develop
the TI Plans and Specs. Landlord and Tenant shall hereafter enter into separate
formal architect's contracts with the Base Building Architect and the Tenant's
Architect, respectively. The Base Building Architect will be engaged by Landlord
to prepare more fully developed plans, drawings and specifications, work with
Landlord through the bid process and supervise the construction of the Base
Building Improvements. The Tenant's Architect will be engaged by Tenant to
prepare more fully developed TI Plans and Specs, work with Tenant through the
bid process, supervise the construction of the Leasehold Improvements and
monitor, on behalf of Tenant, the construction of the Base Building
Improvements. Landlord and Tenant agree to work together to engage the services
of the Base Building Architect and the Tenant's Architect, respectively, under
contracts that properly allocate the design responsibilities to each of Landlord
and Tenant, and to assure that the construction of the Building is well
coordinated. In order to assure such coordination, Landlord shall furnish a copy
of its architect's contract to Tenant, and it is intended by the parties that
the preparation of Tenant's Architect's contract shall take into account the
terms of the Base Building Architect's contract so as to avert gaps or
inconsistent standards and requirements. Tenant shall furnish a copy of its
proposed architect's contract with the Tenant's Architect to Landlord prior to
its execution for Landlord's review and approval, which shall not be
unreasonably withheld or delayed. In either case, purely economic terms that a
party may reasonably believe are appropriately confidential may be redacted.
Tenant's agreement with the Tenant's Architect shall require the Tenant's
Architect to incorporate the MEP Engineer, the Structural Engineer, the Civil
Engineer, and if needed as determined by Tenant the Lighting Consultant, into
its team and to work closely with such parties so as to ensure coordination of
the complete design package. If Landlord should elect to replace the Base
Building Architect, the MEP Engineer or the
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Structural Engineer, or Tenant should elect to replace the Tenant's Architect
and engage a replacement architect or engineer to fulfill the responsibilities
contemplated to be undertaken by the respective architect or engineer on behalf
of such party (the parties hereby agreeing that such a replacement of an
architect or engineer will not be implemented without good cause), the identity
of the replacement shall be subject to the other party's approval, which shall
not be unreasonably withheld or delayed.
Section 2.2 Tenant shall enter into an agreement (which may be one or more
employment relationships or consulting agreements) with a project manager or
project management team ("Tenant's Representative"), which project manager will
perform certain services for and on behalf of Tenant during the design and
construction phases of the Leasehold Improvements. Tenant shall, at its sole
cost and expense, and in accordance with the terms and conditions of its
agreement with Tenant's Representative, compensate Tenant's Representative for
providing such services. Landlord hereby agrees that Tenant's Representative
shall receive copies of all notices to which reference is made in this Work
Letter given by Landlord to Tenant. Tenant hereby agrees that Tenant's
Representative shall have authority to act as Tenant's representative in
connection with its participation in meetings and otherwise, and that except to
the extent Landlord has been given contrary instructions in writing from Tenant
with respect to any matter with which Tenant's Representative has been involved,
Landlord is entitled to rely on Tenant's Representative as the party having
authority to make decisions and establish schedules for the performance of work.
Tenant agrees further to continue to engage Tenant's Representative to render
the services contemplated hereunder, or a qualified successor subject to
Landlord approval, which shall not be unreasonably withheld, until such time as
final completion of the Tenant's Construction Work and occupancy by Tenant in
the Premises has been achieved. Landlord shall appoint a project manager
("Landlord's Representative"), which project manager will perform certain
services on behalf of Landlord during the design and construction phase of
Landlord's Construction Work. Tenant hereby agrees that all notices to which
reference is made in this Work Letter given by Tenant to Landlord shall be
delivered to the attention of Landlord's Representative. Landlord hereby agrees
that Landlord's Representative shall have authority to act as Landlord's
representative in connection with its participation in meetings and otherwise,
and that except to the extent Tenant has been given contrary instructions in
writing from Landlord with respect to any matter with which Landlord's
Representative has been involved, Tenant is entitled to rely on Landlord's
Representative as the party having authority to make decisions and establish
schedules for the performance of work.
ARTICLE 3
Base Building
PLANS AND SPECIFICATIONS
Section 3.1 Landlord shall, at its sole cost and expense (except as
provided in Section 3.2 and Article 8), as soon as reasonably possible, but in
any event in substantial conformity with
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the "Design and Construction Commencement Schedule" attached hereto as SCHEDULE
C3, cause the completion of the Base Building Design Development Plans and Specs
as necessary to permit construction of the Base Building Improvements to
commence on or before the date contemplated therefor, and thereafter finally
complete the Base Building Plans and Specs as necessary to permit construction
of the Base Building Improvements to proceed expeditiously. For all purposes
hereof, the "Base Building Plans and Specs" means the plans, specifications and
working drawings for the completion of the Base Building Improvements, as the
same may be modified consistently with the terms and conditions hereof. If
Tenant requests any changes to the Base Building Plans and Specs prior to
Landlord's commencement of construction of the Base Building Improvements, such
request shall be governed by Section 3.2 below. After Landlord commences
construction of the Base Building Improvements any changes that Tenant requests
to the Base Building Improvements, shall be governed by Article 8.
Section 3.2 The Base Building Plans and Specs shall always remain
consistent with the Building Standards and, if during the development and
completion of the Base Building Plans and Specs, Landlord desires to make any
change that, in Tenant's judgment reasonably exercised by notice to Landlord,
within ten (10) business days of Landlord's notice of a proposed change in the
Base Building Plans and Specs (time being of the essence), would not be so
consistent, then such change may not be made without Tenant's consent, which
shall not be unreasonably withheld or delayed. Any plans and specifications (or
modifications to existing plans and specifications) associated with a change to
the Base Building Plans and Specs initiated by Landlord, whether or not Tenant's
consent thereto must be obtained by Landlord in accordance with the preceding
sentence, will be furnished by Landlord to Tenant promptly following their
having been prepared by the Architect. If during the development and completion
of the Base Building Plans and Specs, Tenant desires to propose a change to the
Base Building Plans and Specs (a "Tenant Base Building Change"), any such Tenant
Base Building Change shall be subject to Landlord's approval, which Landlord
shall not unreasonably withhold or delay. If Tenant proposes to make a Tenant
Base Building Change, Landlord shall cause all plans and specifications
associated therewith to be prepared by the Base Building Architect, at Tenant's
sole cost and expense. Without limitation of the foregoing, Landlord shall not
be deemed to be unreasonable for withholding consent to any Tenant Base Building
Change which would diminish the Building Standards with respect to the Base
Building Improvements, would cause aggregate delay (together with any other
Tenant Delay) in excess of ninety (90) days in the Substantial Completion of the
Base Building Improvements, or which Landlord would be entitled to reject under
Article 4 of the Lease. Landlord may, in any event, condition its approval to a
Tenant Base Building Change proposed by Tenant upon Tenant's expressly
acknowledging its responsibility for any increase in the costs or adjustment to
the construction schedule associated with the Base Building Improvements
resulting from such Tenant Base Building Change. At the time of the giving of
any consent by Landlord to a Tenant Base Building Change, Landlord shall give
Tenant notice of its non-binding estimate of costs for which Tenant will be
responsible in connection with such Tenant Base Building Change, as calculated
in accordance with Section 11.5 hereof, and the extent of any resulting change
in the Construction Progress Schedule, provided that such change in the
Construction Progress Schedule shall not limit the determination of the extent
of any delay caused by such Tenant Base Building Change.
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Neither the requirement that Tenant submit such plans and specifications to
Landlord, nor Landlord's or Landlord's agents' actual or implied review thereof,
shall in any way be an agreement by Landlord that (i) the work contemplated
thereby or any other aspect thereof complies with legal or other requirements,
(ii) that such plans and specifications will be approved by any governmental
authority having jurisdiction thereover, (iii) that the plans and specifications
are free from errors, omissions or inconsistencies, or are coordinated with the
Base Building Plans and Specs or within themselves, and without limitation, any
delay associated with any of the foregoing (i), (ii) or (iii), or any delay in
Landlord's ability to cause the Steel Frame Completion Date, the Building
Weathertight Date or the date upon which Substantial Completion of the Base
Building Improvements occurs as a consequence of the Tenant Base Building Change
shall constitute Tenant's Delay.
Section 3.3 Tenant shall make payment to Landlord of any increase in
Landlord's costs associated with construction of the Base Building Improvements,
resulting from any Tenant Base Building Change (whether greater or less than the
amount of Landlord's non-binding estimate), in accordance with the terms and
conditions of Section 11.5.
ARTICLE 4
TI PLANS AND SPECIFICATIONS
Section 4.1 Tenant shall at its sole cost and expense (except as provided
in Article 8), as soon as reasonably possible, but in any event in substantial
conformity with the Design and Construction Commencement Schedule, cause the
completion of the TI Plans and Specs as necessary to permit construction of the
Leasehold Improvements to commence on the Steel Frame Completion Date, and
thereafter to proceed expeditiously to completion. For all purposes hereof, the
"TI Plans and Specs" means the plans, specifications and working drawings for
the completion of the Leasehold Improvements approved by Landlord as herein
provided, as the same may be modified consistently with the terms and conditions
hereof.
Section 4.2 The TI Plans and Specs, including without limitation each
iteration thereof, and each change proposal with respect thereto, through and
including the "as-built" version thereof, and the Leasehold Improvements
contemplated to be performed in accordance therewith, shall be subject to
Landlord's prior approval, which approval shall not be unreasonably withheld or
delayed. Tenant shall furnish Landlord, throughout Tenant's design process, with
each of schematic design drawings, followed by design development plans and
specifications, followed by interim construction drawings and finally with final
100% construction drawings, as contemplated by the Design and Construction
Commencement Schedule, and Landlord shall make any comments or request any
changes, as contemplated under Article 10 hereof. Without limitation of the
foregoing, Landlord shall not be deemed to be unreasonable for requiring that
the standards provided in Article 4 of the Lease are being fulfilled, or for
withholding approval with respect to any aspect of TI Plans and Specs that are
inconsistent or incompatible with the Base Building Plans and Specs, unless
Tenant proposes a Tenant Base Building Change to remedy such inconsistency or
incompatibility, to which
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Landlord has no objection under Section 3.2. Neither the requirement that the TI
Plans and Specs be submitted to Landlord nor Landlord's or Landlord's agents
actual or implied review of the TI Plans and Specs on changes thereto shall in
any way be deemed to be an agreement by Landlord that (i) the work contemplated
thereby or any other aspect thereof complies with legal or other requirements,
(ii) that the TI Plans and Specs will be approved by any governmental agency
having jurisdiction thereover, (iii) that the TI Plans and Specs are free from
errors, omissions or inconsistencies or are coordinated with the Base Building
Plans and Specs or within the TI Plans and Specs, and without limitation, any
delay in Landlord's ability to cause the Steel Frame Completion Date or the date
upon which Substantial Completion of the Base Building Improvements to occur
associated with any of the foregoing (i), (ii) and (iii) as they pertain to the
TI Plans and Specs shall constitute Tenant's Delay.
ARTICLE 5
ENGAGEMENT OF CONTRACTOR
Section 5.1 In order to most effectively coordinate the construction of the
Base Building Improvements and the Leasehold Improvements, in the time frames
contemplated herein, the construction of the Base Building Improvements and
Leasehold Improvements must be undertaken concurrently by a single, mutually
agreed upon, Contractor. Landlord and Tenant shall jointly select the
Contractor, and Landlord and Tenant shall then, under separate contracts, engage
the Contractor, and enter into such other arrangements as are appropriate, to
cause the Base Building Improvements and Leasehold Improvements, respectively,
to be timely constructed, installed and completed. Landlord shall furnish a copy
of its construction contract to Tenant, and it is intended by the parties that
Landlord's contracts with the Contractor shall serve as a guide to the
preparation of Tenant's contract with the Contractor. Tenant shall furnish a
copy of its proposed construction contract with the Contractor, prior to its
execution for Landlord's review and approval, which shall not be unreasonably
withheld or delayed. It is contemplated that Tenant's construction contract with
the Contractor be consistent with the terms and conditions set forth in
Landlord's contract with the Contractor, and due to the fact that the
construction of the Base Building Improvements and Leasehold Improvements are to
be performed contemporaneously in significant respects, the coordination of the
construction process and the proper undertaking of responsibility by the
Contractor on behalf of Landlord and Tenant is critically important. In the case
of both Landlord's and Tenant's delivery of their respective construction
contracts to the other, purely economic terms that a party may reasonably
believe are appropriately confidential may be redacted. However, in no event
shall the economic terms associated with the pricing of change orders be
considered appropriately confidential, as under certain circumstances each party
may be responsible for increases in cost incurred by the other party in
connection with change orders. If either Landlord or Tenant should elect to
replace the Contractor to fulfill the responsibilities contemplated to be
undertaken by the Contractor on behalf of such party, and the parties agree that
such a replacement of the Contractor will not be implemented without good cause,
the identity of the replacement shall be subject to the other party's approval,
which shall not be unreasonably withheld or delayed.
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Section 5.2 If either Landlord or Tenant should desire to replace the
Contractor to fulfill the responsibilities contemplated to be undertaken by the
Contractor on behalf of such party, the approval of the other party shall be
required as a condition thereto.
ARTICLE 6
CONSTRUCTION OF THE
BASE BUILDING IMPROVEMENTS
Section 6.1 Landlord shall install, furnish and perform, as the case may
be, with reasonable diligence and in a good and workmanlike manner and at its
sole cost and expense (except as otherwise expressly provided herein to the
contrary), the facilities, materials, labor, supplies and work required for the
construction of the Base Building Improvements in accordance with the Base
Building Plans and Specs. All building permits, certificates of occupancy and
other governmental approvals required to construct the Base Building
Improvements shall be obtained by Landlord at Landlord's sole cost and expense
(except as expressly otherwise provided herein).
Section 6.2 Landlord has established a construction progress schedule (the
"Construction Progress Schedule") for construction and completion of the Base
Building Improvements, which specifies the material activities and events that
will occur during each phase of the Base Building Improvements and sets forth
key dates and certain aspects of construction that are anticipated to be
substantially completed thereby in order that the Base Building Improvements are
timely completed. The Construction Progress Schedule will be updated as
necessary to reflect Landlord's then expectations including, without limitation,
following the occurrence of circumstances reasonably anticipated to affect the
progress of construction. The Construction Progress Schedule will indicate,
without limitation, the anticipated Steel Frame Completion Date. No modification
of the Construction Progress Schedule as hereinabove contemplated, or otherwise
as permitted hereunder, shall necessarily result in a postponement of the
Estimated Rent Commencement Date or the Rent Commencement Date. The only
circumstances resulting in a postponement of either of such dates shall be the
circumstances contemplated in Section 2.5 of the Lease.
Section 6.3 The Base Building Improvements shall for all purposes hereof be
deemed at the stage of completion sufficient to permit Landlord to establish
that the "Steel Frame Completion Date" has occurred on such date as all five
floors of the Building have been fully framed, with concrete slabs poured and
steel fireproofing installed, except for insubstantial areas not meeting the
aforesaid condition, or certain areas not meeting the aforesaid condition by
virtue of Landlord's having accommodated Tenant's request that certain work be
delayed to accommodate possible Tenant changes or Leasehold Improvements. The
projected Steel Frame Completion Date will be indicated on the Construction
Progress Schedule, and upon satisfaction of the conditions thereto, the parties
will memorialize in writing that the conditions have so occurred. The Base
Building Improvements shall, for all purposes hereof, be deemed to have
fulfilled the conditions to establish the "Building Weathertight Date" on such
date as the
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masonry walls are substantially complete, glazing and curtain wall systems are
installed in all material respects and the roof is essentially watertight,
provided that thereafter Tenant shall be reasonably able to continuously
prosecute and complete the Leasehold Improvements without material interference;
however, the Building Weathertight Date shall be deemed to have occurred
notwithstanding that caulking of joints, roofing trim, etc. is not complete,
certain windows are left open to accommodate construction loading, and certain
areas do not fulfill the conditions to the Building Weathertight Date because
Landlord has accommodated Tenant's request that Landlord leave an area open to
accommodate changes or subsequent deliveries. Landlord shall diligently proceed
with the construction of the Base Building Improvements and endeavor to achieve
the stage of completion sufficient to permit Landlord to cause the Steel Frame
Completion Date to occur on or before August 3, 2001, and the Building
Weathertight Date to occur on or before November 6, 2001.
ARTICLE 7
CONSTRUCTION OF THE
LEASEHOLD IMPROVEMENTS
Section 7.1 On or prior to the Steel Frame Completion Date, Tenant shall
furnish Landlord with a reasonably detailed construction budget for the
Leasehold Improvements (the "Leasehold Improvements Cost Budget") specifying the
anticipated Eligible Leasehold Improvements Expenses (as hereinafter defined).
In the event of any Tenant Leasehold Improvement Change Order (as hereinafter
defined) which is approved by Landlord under Section 8.4, Tenant shall furnish
Landlord with a revised Leasehold Improvements Cost Budget (a "Revised Leasehold
Improvements Cost Budget"), together with any amount required under Section 8.4
for deposit in Tenant's Construction Escrow.
Section 7.2 Tenant shall install, furnish, and perform, as the case may be,
with reasonable diligence and in a good and workmanlike manner, within the time
frame contemplated by Article 4 and this Article 7, and at its own cost and
expense (except as otherwise expressly provided to the contrary herein), the
facilities, materials, labor, supplies and work required for the construction of
the Leasehold Improvements in accordance with the TI Plans and Specs. The
Leasehold Improvements shall be constructed, installed and performed in
accordance with the Rules and Regulations for Tenant Construction which are set
forth as SCHEDULE C4 and with any and all requirements which Landlord may
reasonably impose pertaining to inspection procedures. All building permits,
certificates of occupancy, and other governmental approvals required to
construct the Leasehold Improvements and to occupy and operate Tenant's business
in the Premises shall be obtained by Tenant at Tenant's sole cost and expense.
Tenant shall undertake the construction of all of the Leasehold Improvements
contemplated under this Work Letter with due diligence and dispatch, but in any
event Tenant shall sufficiently complete the same in order to qualify for a
certificate of occupancy for at least seventy five percent (75%) of the floor
area of the Building on or before the Rent
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Commencement Date, and for the entire Building on or before the date twelve (12)
months following the Rent Commencement Date.
Section 7.3 Following final completion of the Leasehold Improvements or any
portion thereof, Tenant shall furnish Landlord "as built" plans thereof.
Section 7.4 Developer's Administrative Fee shall be payable to Landlord, in
equal monthly installments of Five Thousand and 00/100 Dollars ($5,000.00) each,
commencing upon the Steel Frame Completion Date. Landlord shall charge payments
owed by Tenant under this Section 7.4 against the Leasehold Improvement
Allowance as and when due and payable.
ARTICLE 8
CHANGES IN THE WORK
Section 8.1 Once Landlord has commenced construction of the Base Building
Improvements, Tenant may nevertheless request changes, subject to the Landlord's
approval as hereinafter provided, in the Base Building Improvements, with an
appropriate adjustment, if any, to the Construction Progress Schedule and with
appropriate provisions for payments by Tenant as herein provided. Any changes in
the Base Building Plans and Specs implementing such a change, which are approved
by Landlord and authorized by Tenant by written change order, are to be prepared
by the Base Building Architect at Tenant's sole cost and expense, and are herein
referred to as a "Tenant Base Building Change Order". Landlord's rights with
respect to approving or withholding approval to a proposed Tenant Base Building
Change Order, and the allocation of responsibility in paying any increase in the
cost of the Base Building Improvements resulting therefrom, shall be governed by
the same criteria as are applicable to requested change to the Base Building
Plans and Specs prior to the commencement of the construction of the Base
Building Improvements under Section 3.2.
Section 8.2 If Landlord determines that a Tenant Base Building Change Order
will result in an increase in the cost ("Tenant's Base Building Change Order
Cost") of the Base Building Improvements, as calculated in accordance with
Section 11.5 hereof, Landlord shall advise Tenant of Landlord's non-binding
estimate thereof (as more fully described in Section 11.5 hereof) and permit
Tenant, in accordance with Section 8.3 below, to decide whether or not to give
Landlord notice that Tenant desires that Landlord proceed with such Tenant Base
Building Change Order. Additionally, Landlord shall give Tenant notice of its
non-binding estimate of any effect that Tenant's Base Building Change Order will
have on the Construction Progress Schedule. Notwithstanding anything to the
contrary otherwise provided in this Article 8, if Tenant should propose a Tenant
Base Building Change Order that is approved by Landlord in accordance with this
Article 8 and approved by Tenant to be implemented by Landlord, and if the
calculation of the Tenant Base Building Change Order Cost with respect thereto
results in a decrease in the cost to the Owner to construct the Base Building
Improvements ("Base Building Change Order Savings"), then such Base Building
Change Order Savings, until fully applied, may be applied by Tenant to any
future Tenant Base Building Change Order Costs thereafter
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incurred by Tenant hereunder. However, Tenant shall not be entitled to any
credit whatsoever for unapplied Base Building Change Order Savings.
Section 8.3 Within five (5) business days after such notification, Tenant
shall, in turn, notify Landlord as to whether Tenant wishes to proceed with the
Tenant Base Building Change Order in question. In the event that Tenant fails to
notify Landlord within such five (5) business day period, Tenant shall
automatically be deemed not to desire the Tenant Base Building Change Order, and
Landlord shall not be obligated to implement the same. If Tenant timely gives
Landlord notice to implement the Tenant Base Building Change Order, then Tenant
shall be responsible for the full Tenant Base Building Change Order Cost
(whether greater or less than the amount of Landlord's non-binding estimate) in
accordance with the terms and conditions of Section 11.5, and any delay in the
occurrence of the Steel Frame Completion Date, the Building Weathertight Date
and/or Substantial Completion of the Base Building Improvements caused thereby,
whether greater or less than the delay estimated by Landlord, shall be deemed
Tenant Delay for all purposes hereof.
Section 8.4 Tenant may, subject to obtaining the Landlord's approval as
hereinafter provided, make changes to the Leasehold Improvements consisting of
additions or deletions to, or other revisions in the approved TI Plans and
Specs, with an appropriate adjustment, if any, to the cost of the Leasehold
Improvements and to the Construction Progress Schedule ("Tenant Leasehold
Improvement Change Order"). However, any change in the cost of the Leasehold
Improvements pursuant to changes approved under this Section 8.4 shall not
affect the basis for Landlord's disbursement of the Leasehold Improvements
Allowance under Section 11.3, which shall be based instead on the Leasehold
Improvements Cost Budget. Instead, any increase in costs for Leasehold
Improvements resulting from a Tenant Leasehold Improvements Change Order shall,
as a condition to Landlord's approval, be deposited as Tenant's Construction
Escrow (as hereinafter defined) for disbursement as contemplated in Section
11.4. Landlord's rights with respect to approving or withholding approval to a
proposed Tenant Leasehold Improvements Change Order shall be governed by the
same criteria as are applicable to the approval of the TI Plans and Specs under
Section 4.2.
Section 8.5 If Landlord elects to make a discretionary change (e.g. not
changes dictated by legal requirements or agreements with municipal authorities,
changes which Landlord is advised should be adopted in order to serve good
construction practice or other changes that otherwise are required to serve some
other non-discretionary purpose) to the Base Building Plans and Specs that would
have the effect of requiring that Tenant modify the TI Plans and Specs, and
increase the cost to Tenant of constructing the Leasehold Improvements, then
Landlord agrees that the Leasehold Improvement Allowance shall be increased by
the amount of such increase. Nothing in the preceding sentence is intended to
impose the burden upon Tenant of any violation by Landlord in its preparation of
the Base Building Plans and Specs of any applicable legal requirements in effect
at the time Landlord obtained the building permit therefor, or any breach by
Landlord of any existing agreements with municipal authorities. Further, nothing
in the preceding sentence is intended to contradict the limitations upon any
change affecting Building Standards set forth in Section 3.2 hereof. Tenant
shall specify based on input from the
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Contractor whether the cost of constructing the Leasehold Improvements would be
increased by virtue of such change in the Base Building Plans and Specs as soon
as is practical following Landlord's inquiry to such effect, specifying the
amount of such increase. If any such change would not be consistent with the
Building Standards, Tenant shall not be deemed unreasonable for withholding
approval thereto on the condition that Landlord agrees to such an increase in
the Leasehold Improvement Allowance.
ARTICLE 9
INDEMNITY; INSURANCE
Section 9.1 Subject to Sections 9.4 below, Tenant shall indemnify and save
harmless Landlord and Landlord's ground lessees, mortgagees and managing agent
for the Building from and against all liability, claims, loss, or damage of
whatever nature, including, without limitation, costs and fees associated with
any claim or proceeding brought thereon such as, but not limited to, reasonable
attorneys' fees and disbursements, arising from any negligence or misconduct of
Tenant, or Tenant's contractors, licensees, agents, servants or employees,
provided that the foregoing indemnity shall not include any liability, claims,
loss or damage to the extent arising from any negligence or misconduct of
Landlord, or Landlord's contractors, licensees, agents, servants or employees or
Landlord's ground lessees, mortgagees or managing agent for the Building.
Subject to Sections 9.4 below, Landlord shall indemnify and save harmless Tenant
from and against all liability, claims, loss, or damage of whatever nature
including, without limitation, costs and fees associated with any claim or
proceeding brought thereon such as, but not limited to, reasonable attorneys'
fees and disbursements arising from any negligence or misconduct of Landlord, or
Landlord's contractors, licensees, agents, servants or employees, provided that
the foregoing indemnity shall not include any claims, loss or damage to the
extent arising from any act, omission or negligence of Tenant, or Tenant's
contractors, licensees, agents, servants or employees.
Section 9.2 Tenant agrees to maintain in full force, from the first day
upon which Tenant or any of Tenant's contractors, licenses, agents, servants or
employees enter upon the Land for any reason, and thereafter, through the
remainder of the Construction Period (after which this Section 9.2 shall be
superseded by Section 7.2 of the Lease), a policy of commercial general
liability insurance under which Landlord (and any individuals or entities
affiliated with Landlord, any ground lessor and any holder of a mortgage on the
Property of whom Tenant is notified by Landlord) are named as additional
insureds, and under which the insurer provides a contractual liability
endorsement insuring against all cost, expense and liability arising out of or
based upon any and all claims, accidents, injuries and damages described in
Section 9.1 above, in the broadest form of such coverage from time to time
available. Each such policy shall be noncancelable and nonamendable (to the
extent that any proposed amendment reduces the limits or the scope of the
insurance required in this Agreement) with respect to Landlord and such ground
lessors and mortgagees without thirty (30) days' prior notice to Landlord and
such ground lessors and mortgagees and at the election of Landlord, either a
certificate of insurance or a duplicate original policy shall be delivered to
Landlord. The minimum limits of liability of
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such insurance shall be Ten Million Dollars ($10,000,000.00) for combined bodily
injury (or death) and damage to property (per occurrence) with an aggregate
annual limit of liability of Ten Million Dollars ($10,000,000.00). Such
insurance may be effected with a combination of a base commercial general
liability policy and umbrella insurance.
Section 9.3 Landlord agrees to maintain in full force throughout the
Construction Period, after which this Section 9.3 shall be superseded by Section
7.4 of the Lease, a policy of commercial general liability insurance with same
limits which Tenant is required to carry under Section 9.2 and shall require
that the Contractor and its subcontractors fulfill, on Landlord's behalf, the
insurance requirements set forth in Landlord's construction contract with the
Contractor previously furnished to Tenant.
Tenant shall also require the Contractor to fulfill, on Tenant's behalf,
the same insurance requirements as Landlord has required the Contractor to
fulfill on Landlord's behalf and require that the Contractor cause
subcontractors and others to fulfill the same insurance requirements as are
applicable to Contractor's obligations under Landlord's construction contract
with the Contractor previously furnished to Tenant.
Section 9.4 Landlord and Tenant each agree that, notwithstanding anything
to the contrary set forth in Section 9.1, in the event that a claim falling
within the scope of the Contractor's commercial general liability insurance
coverage, as required to be carried by Landlord's contract for the Base Building
Improvements, and Tenant's contract for the Leasehold Improvements, Landlord and
Tenant will seek to cause the Contractor's insurance underwriter to defend and,
if appropriate, settle and pay any claim. Only in the event a claim does not so
fall within the scope of such Contractor's insurance coverage shall such claim
shall be subject to the indemnification provisions of Section 9.1 hereof.
Section 9.5 Landlord covenants and agrees that Landlord shall carry the
property insurance, including, without limitation, "builder's risk" coverage,
with respect to both the Base Building Improvements and the Leasehold
Improvements as the same are performed during the Construction Period. Any costs
and expenses equitably allocable to "builder's risk" coverage for the Leasehold
Improvements shall be charged to Tenant, and may be deducted by Landlord from
the Leasehold Improvement Allowance. In case of fire or casualty, or other
circumstances giving rise to a claim under such insurance, the proceeds of
insurance, as well as the deductible associated with any claim, shall be
equitably allocated by Landlord, in its reasonable judgment, to Landlord's costs
of restoring the damaged or destroyed Base Building Improvements, and the
Leasehold Improvement Allowance, to be applied to the cost of restoring the
damaged or destroyed Leasehold Improvements.
Section 9.6 The indemnities set forth in Section 9.1 above shall be subject
to the limitations set forth in Section 12.16 of the Lease.
Section 9.7 Any required insurance may be in the form of blanket coverage,
so long as the coverage required herein is maintained. Each party shall cause a
certificate, providing such
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information as reasonably requested by the other party, evidencing the existence
and limits of its insurance coverage with respect to the Premises and the
Building, as the case may be, to be delivered to such other party on or prior to
the date hereof. Thereafter, each party shall cause similar certificates
evidencing renewal policies to be delivered to such other party at least thirty
(30) days prior to the expiration of the term of each policy and at such other
times as reasonably requested by the other party. The insurance policies and
certificates required by this Article 9 shall contain a provision requiring the
insurance company to furnish Landlord and Tenant, as the case may be, thirty
(30) days' prior written notice of any cancellation or lapse, or the effective
date of any reduction in the amounts or scope of coverage.
ARTICLE 10
COOPERATION
Section 10.1 Landlord and Tenant agree to promptly furnish to each other
such information as may be reasonably requested by the other party in connection
with a request for approval of plans and specifications pursuant to Articles 3
and 4, and to promptly give such approval or specify objections or concerns.
Each of Landlord and Tenant agree that they will reasonably furnish materials
for which the other party's approval is required hereunder in a staged manner,
so that undertaking a review of the materials furnished can reasonably be
accomplished within the time frame hereinafter established therefor. A party
shall give its approval, or withhold or qualify its approval specifying the
reasons therefor, within ten (10) business days of the other party's written
request [which must specify the deadline date for response], failing which the
approval shall be deemed given. The aforesaid ten (10) business day deadline
shall be shortened to five (5) business days in the case of a request for
approval that modifies a prior request for approval with respect to which the
other party withheld or qualified its approval.
Section 10.2 Landlord and Tenant agree to work together cooperatively so as
to coordinate the management, administration, and scheduling of the Base
Building Improvements and the Leasehold Improvements. Such cooperation shall
include without limitation, regular meetings during the Construction Period with
the Contractor, the attendance at such meetings to include authorized
representatives of Landlord and Tenant's Representative. Landlord and Tenant
each agree that they shall respectively assure the availability of such
representatives at reasonable times after reasonable notice. For the foregoing
purposes, Landlord has initially designated Richard McGerigle and Carin Herring
as Landlord's representatives. As construction of the Base Building Improvements
and the Leasehold Improvements will, to a certain extent, be conducted
contemporaneously, each of Landlord and Tenant expressly acknowledge that in
conducting their respective work, due care must be exercised to avert
interference in the conduct by the other party of its work, and each party
covenants and agrees to exercise reasonable efforts to avert such interference.
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ARTICLE 11
PAYMENT OF COSTS; LEASEHOLD IMPROVEMENTS ALLOWANCE
Section 11.1 Landlord shall provide to Tenant an allowance (the "Leasehold
Improvements Allowance") equal to (i) the product of Seventy Five and 00/100
Dollars ($75.00) times the rentable square footage of the Premises less (ii) One
Million Three Hundred Thousand and 00/100 Dollars ($1,300,000.00), for
application to certain costs and expenses, more particularly set forth below,
incurred by or on behalf of Tenant in connection with the performance of the
Leasehold Improvements. If Tenant incurs costs in connection with the
construction of the Leasehold Improvements in excess of the Leasehold
Improvements Allowance, then except as otherwise expressly provided in Section
8.5 and Section 12.6, all such costs shall be borne solely by Tenant.
Additionally, if Tenant incurs costs in connection with the Leasehold
Improvements by virtue of changes approved under Section 8.5, then all such
costs shall be paid by Tenant as and when incurred, and Tenant may not
requisition for advance of any remaining Leasehold Improvements Allowance to
reimburse Tenant for such cost until all Initial Leasehold Improvements have
been substantially completed and paid for, and any remaining Leasehold
Improvements have been substantially completed.
Section 11.2 The application of the Leasehold Improvement Allowance by
Landlord shall be limited to payment of the following costs and expenses
incurred by or on behalf of Tenant in connection with the Leasehold Improvements
that constitute the Base Laboratory Improvements (collectively "Eligible
Leasehold Improvement Expenses"): the actual documented and verified cost
pursuant to Tenant's construction contract, including without limitation the
associated contractor's overhead and profit and general conditions, together
with the Developer's Administrative Fee, incurred in the construction of the
Leasehold Improvements contemplated by the TI Plans and Specs, except for the
making of improvements, installation of fixtures or incorporation of other items
which (x) by virtue of their quantity or quality (whether greater or less) would
not be of general utility to other laboratory tenants that might later occupy
the Premises, whether at the expiration of the Term or by virtue of the earlier
termination of this Lease, or (y) are moveable rather than permanent
improvements, examples of which may include furniture, telephone communications
and security equipment, and bench-top laboratory equipment items such as
microscopes. In the event that, upon substantial completion of the Leasehold
Improvements, there remains unapplied funds from the Leasehold Improvement
Allowance, then (i) architectural and engineering design fees, up to an
aggregate of the product of Five Dollars ($5.00) times the rentable square
footage of the Premises shall be deemed Eligible Leasehold Improvement Expenses
and (ii) Tenant's Base Building Change Expenses shall be deemed Eligible
Leasehold Improvement Expenses (which if Tenant has already remitted payments on
account thereof under Section 11.5 below, they shall be reimbursed by Landlord
to Tenant up to but not exceeding any remaining balance of the Leasehold
Improvements Allowance).
Section 11.3 If the anticipated cost and expense established in the
Leasehold Improvements Cost Budget for the Leasehold Improvements, or in any
Revised Leasehold
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Improvements Cost Budget, should exceed the lesser of (i) so much of such costs
that will constitute Eligible Leasehold Improvement Expenses or (ii) the
Leasehold Improvement Allowance ("Excess Leasehold Improvement Costs"), then
such amount shall be deposited in escrow ("Tenant Construction Escrow") with
Landlord pursuant to the escrow requirements set forth in Article 15 of this
Work Letter. If for any reason the anticipated cost and expense of performing
the Leasehold Improvements should change, the Tenant's Leasehold Improvement
Cost Budget shall be changed accordingly and Tenant shall deposit into the
Tenant Construction Escrow consistent with such reasonable requirements as may
be imposed upon Landlord by Landlord's construction lender with respect to the
Base Building Improvements any increase in the Excess Leasehold Improvement
Costs so that the amount which is so held in escrow shall always equal the
amount by which the then cost of completing the Leasehold Improvements exceeds
the aggregate of (x) the unadvanced Leasehold Improvement Allowance available to
pay the then budgeted Eligible Leasehold Improvement Expenses and (y) the then
amount held in the Tenant Construction Escrow.
Section 11.4 During the construction of the Leasehold Improvements and in
accordance with the commercially reasonable terms and conditions imposed upon
the Landlord pursuant to the loan agreement with Landlord's lender pertaining to
the construction of the Base Building Improvements such as, without limitation,
retainage, lien waiver, and other requisition conditions, Tenant shall, on a
monthly basis (as the Contractor submits to Tenant its application for payment),
deliver to Landlord a requisition for payment showing the cost of the Leasehold
Improvements and the amount of the current payment requested from Landlord for
disbursement from the Leasehold Improvements Allowance or Tenant Construction
Escrow, as applicable. Payments made on account of Tenant's requisitions shall
be made from the Leasehold Improvement Allowance and the Tenant Construction
Escrow account on a proportionate basis consistent with the ratio of (i) the
lesser of (x) the Eligible Leasehold Improvements Expenses set forth in the
Leasehold Improvement Cost Budget established as of the Steel Frame Completion
Date and (y) the Leasehold Improvement Allowance to (ii) the total Leasehold
Improvement Cost Budget established as of the Steel Frame Completion Date. If
Tenant should increase the Leasehold Improvement Cost Budget by authorizing
change orders, then the increased costs shall be deposited by Tenant in the
Tenant Construction Escrow account when due, and such increased costs shall be
paid exclusively from the Tenant Construction Escrow Account, in order to
maintain the same ratio of Landlord's advances from the Leasehold Improvements
Allowance to the total of Tenant's requisitions, as the ratio of the Eligible
Leasehold Improvements Expenses to the total Leasehold Improvements Cost Budget.
Each of the requisitions for payment shall also show the amounts paid to date
and the percent complete of the total Leasehold Improvements scope. Landlord
contemplates delivering Tenant's requisitions to the Lender together with its
own requisitions for payment of costs associated with Base Building
Improvements, and Landlord shall promptly, but in any event within (30) days,
pay Tenant the appropriate amount. Following the completion of the Leasehold
Improvements, Tenant shall deliver to the Landlord, within ninety (90) days of
completion, a statement showing the final costs of the Leasehold Improvements,
the total of Tenant's excess costs, the amounts paid to date to, or on behalf of
the Tenant, and any amounts available for release of retainage.
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Section 11.5 Tenant shall make payment to Landlord of all Landlord's
estimates of Landlord's costs ("Tenant's Base Building Change Expenses")
associated with any Tenant Base Building Change (which is contemplated to be a
change to the Base Building Plans and Specs prior to commencement of
construction of the Base Building Improvements) and any Tenant Base Building
Change Order (which is contemplated to be a change order to the Base Building
Plans and Specs occurring during the construction of the Base Building
Improvements) as a condition to Landlord's approval thereof, which sum shall be
deposited in the Tenant Construction Escrow. Such costs shall be equal to the
sum of (a) all so-called "hard costs" as specified in Landlord's contract with
Contractor reasonably and necessarily incurred with the subject change, plus (b)
all reasonable, actually incurred so-called third party "soft costs" in
connection with the subject change (including, without limitation, interest and
other carrying costs), plus (c) reasonable, actually incurred so-called "general
conditions", plus (d) Contractor's overhead and profit, and (e) all reasonable,
actually incurred design and engineering costs in connection with the design of
such change. Tenant shall have the right to review the basis for any
determination of Tenant's Base Building Change Expenses.
Section 11.6 All of the payments to be made by Landlord and Tenant
described in this Article 11, shall be made based upon the rentable floor area
of the Premises calculated by the Base Building Architect in accordance with
Exhibit A to the Lease on the basis of the Base Building Plans and Specs as of
the date the square footage of the Premises is established under Exhibit A to
the Lease. After any final determination of such rentable floor area pursuant to
Section 2.1 of the Lease, the aforesaid payments shall be adjusted between the
parties within thirty (30) days of such final determination.
Section 11.7 Any improper failure by Landlord to make payment of all or any
portion of the Leasehold Improvements Allowance shall constitute a default by
Landlord under this Work Letter and consequently under the Lease, and shall
therefor be governed in accordance with Section 9.7. However, after the
expiration of the notice and cure periods set forth in Section 9.7 of the Lease,
and subject in any case to the proviso set forth in the last sentence of said
Section 9.7, Tenant shall have the right to offset such payments owing to Tenant
against sums otherwise due and owing by Tenant to Landlord under the Lease.
ARTICLE 12
SUBSTANTIAL COMPLETION; DELAYS
Section 12.1 For all purposes hereof, "Substantial Completion" of the Base
Building Improvements shall be deemed to have taken place once the Base Building
Improvements have been substantially completed in substantial accordance with
the Base Building Plans and Specs. The Base Building Architect shall establish
the Substantial Completion has occurred, subject to the reasonable approval of
Tenant's Architect. The conditions to Substantial Completion as aforesaid shall
be deemed fulfilled notwithstanding that minor or insubstantial details of
construction, mechanical adjustment, balancing or decorating remain to be
performed, or that any other work (upon which a temporary certificate of
occupancy for the Premises is not contingent)
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remains to be performed, provided that (i) neither the failure of such items of
work to have been completed, nor (ii) Landlord's undertaking such work
thereafter, will materially and adversely affect Tenant in occupying and
conducting business therein. Without limitation of (and notwithstanding) the
foregoing, any Base Building Improvements that are incomplete to the extent
necessary to interface with yet-to-be-completed Leasehold Improvements and, if
applicable and acknowledged by both parties, any finish work included within
Base Building Improvements that might appropriately be delayed due to the degree
of Leasehold Improvements then still being performed or yet to be performed
(such as, for example, final painting of stairway, if significant damage to
paint surfaces might still be expected), shall not prevent, by virtue of such
incompleteness, the conditions to Substantial Completion of Base Building
Improvements from being fulfilled.
Section 12.2 It is contemplated by Landlord and Tenant that Landlord will
commence construction of the Base Building Improvements on or before the date
contemplated therefor in the Construction Progress Schedule. Assuming the
foregoing is achieved, Landlord contemplates the Steel Frame Completion Date
occurring on or before the date projected therefor and Substantial Completion of
the Base Building Improvements occurring by the date set forth as the Estimated
Rent Commencement Date in the Lease. Tenant shall have the period commencing on
the Steel Frame Completion Date until the Rent Commencement Date during which
Tenant may cause the Leasehold Improvements to be constructed prior to the
commencement of the rental and other obligations that accrue thereafter. Once
the conditions to Substantial Completion of the Base Building Improvements have
been fulfilled, Landlord shall promptly thereafter continue to finally complete
the Base Building Improvements, as contemplated in Section 13.1.
Section 12.3 As used herein, "Tenant Delay" shall mean any delay in the
satisfaction of the condition in question (e.g. the Steel Frame Completion Date,
the Building Weathertight Date or the date upon which Substantial Completion of
the Base Building Improvements is achieved) to the extent the same is a
consequence of any act, omission or neglect of (i) Tenant, (ii) Tenant's
Architect, or (iii) any other employee, agent, Contractor (but only in its
performance of the Leasehold Improvements), subcontractor, sub-subcontractor,
agent or representative of Tenant, including without limitation, any (x) errors,
omissions or inconsistencies in the TI Plans and Specs or the lack of
coordination of the TI Plans and Specs with the Base Building Plans and Specs,
(y) delays attributable to any modification to the Base Building Plans and Specs
attributable to a Tenant Base Building Change, or any Tenant Base Building
Change Orders, or (z) otherwise from interference that could reasonably have
been averted in a diligent and reasonably cooperative manner had Tenant's
construction of the Leasehold Improvements been so conducted.
Section 12.4 As used in this Work Letter, "Landlord Delay" shall mean any
delay in substantial completion of those Leasehold Improvements that would
otherwise have been substantially completed prior to the Rent Commencement Date,
but are not so substantially completed by the Rent Commencement Date, to the
extent the same is a consequence of any act, omission or neglect of (i)
Landlord, (ii) the Base Building Architect, or (iii) any other employee,
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agent, Contractor (but only in its performance of the Base Building
Improvements), subcontractor, sub-subcontractor, agent or representative of
Landlord, including without limitation from interference that could reasonably
have been averted had Landlord's construction of the Base Building Improvements
been conducted in a diligent and reasonably cooperative manner, and any delay
beyond the Rent Commencement Date in Tenant's reasonable ability to occupy the
Premises by virtue of any inability by Tenant, due to Landlord's failure to
fulfill its obligations hereunder, to obtain any building permits, certificates
of occupancy or other governmental approvals required by Tenant in order to
construct the Leasehold Improvements and occupy and operate Tenant's business in
the Premises.
Section 12.5 In the event of a condition causing delay as set forth in this
Article 12, the party affected by such condition (the "Delayed Party") shall
exercise reasonable efforts to give written notice ("Delay Notice") to the other
party (the "Other Party") within five (5) business days following the
commencement of such condition indicating the cause of delay and the probable
duration thereof. Failure by the Delayed Party to give such notice, where it was
reasonable under the circumstances to expect that the Delayed Party should have
been aware that a condition would cause delay, shall result in the delay in the
commencement of the period that the Delayed Party may consider Tenant Delay,
Landlord Delay or Excusable Delay (as applicable) to have commenced by the
number of days in excess of five (5) business days that the Delay Notice is
itself delayed in being given. It is agreed that a Delayed Party shall exercise
commercially reasonable efforts to mitigate the effects of any delay, whether
caused by the Other Party or an Excusable Delay.
Section 12.6 If Landlord must incur change order costs under its
construction contract with the Contractor with respect to the Base Building
Improvements by virtue of Tenant Delay, such costs shall be payable by Tenant as
an additional cost of its Leasehold Improvements as provided herein. If Tenant
must incur change order costs under its construction contract with the
Contractor with respect to the Leasehold Improvements by virtue of Landlord
Delay, the Leasehold Improvement Allowance shall be increased by the amount of
such costs. In either case, the parties agree that they shall use commercially
reasonable efforts to minimize such costs.
ARTICLE 13
COMPLETION OF BASIC BUILDING IMPROVEMENTS; PUNCH LIST
Section 13.1 Notwithstanding that Substantial Completion of the Base
Building Improvements shall be deemed to have occurred, subject to the
provisions of this Article 13, Landlord shall with reasonable diligence cause
the remaining Base Building Improvements to be completed on or before the Rent
Commencement Date, or as soon thereafter as reasonably possible.
Section 13.2 Within fifteen (15) days of Substantial Completion of the Base
Building Improvements, but in any event prior to Tenant's occupancy of all or
any portion of the Premises, Landlord and Tenant shall conduct a joint
inspection of the Base Building
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Improvements, and within five (5) days thereof, Tenant shall furnish to Landlord
a notice ("First Punch List Notice") specifying any aspect of Base Building
Improvements which remains to be completed or which, if completed, is not
substantially in accordance with the Base Building Plans and Specs, excluding
any aspect of Base Building Improvements which cannot reasonably be inspected or
evaluated due to seasonal factors, due to the fact that its proper construction,
installation or adjustment cannot be evaluated, because of the nature of
Tenant's use and occupancy of the Building, the aspect of Base Building
Improvements will not be utilized sufficiently, or other similar reason ("Late
Punch List Items"). Tenant shall, as promptly as reasonably possible following
Substantial Completion of the Base Building Improvements, but in any event
before the first (1st) anniversary of the Substantial Completion of the Base
Building Improvements, give Landlord notice (a "Late Punch List Notice") of any
deficiency in the Late Punch List Items. Landlord shall cause any incomplete
work to be promptly completed and/or remedy any such work not substantially in
accordance with the Base Building Plans and Specs promptly following the
identification of the work that needs to be performed, whether pursuant to the
First Punch List or any Later Punch List. In no event shall Landlord be
obligated to repair or cause the repair of any damage to the Base Building
Improvements caused by Tenant, its employees, agents or contractors (including
without limitation the Contractor or any of its subcontractors in the
performance of Leasehold Improvements). Nothing in this Section 13.2 shall limit
any of Tenant's rights or Landlord's obligations under the Lease with respect to
the maintenance or operation of the Building.
Section 13.3 If Tenant shall fail to conduct an inspection of Base Building
Improvements and timely give to Landlord either the First Punch List Notice or a
Late Punch List Notice, as provided in Section 13.2 above, then it shall be
deemed that the Base Building Improvements have been fully completed in
accordance with the Base Building Plans and Specs. Nothing in this Section 13.3
shall limit any of Tenant's rights or Landlord's obligations under the Lease
with respect to the maintenance of operation of the Building.
Section 13.4 Tenant shall furnish Landlord, promptly after the substantial
completion of the Leasehold Improvements, an "as built" iteration of the TI
Plans and Specs (which, in the case of architectural plans, may be an "as built"
mark-up of the construction documents).
ARTICLE 14
ARBITRATION
It is the parties' mutual intention that any disputes relating to the
provisions or obligations in this Work Letter shall be negotiated in good faith
by the parties and their design and construction professionals, as applicable,
without being referred to arbitration or litigation. However, in the absence of
prompt resolution, any disputes relating to provisions or obligations in this
Work Letter, exclusive of any rent abatement rights that Tenant may claim under
Section 9.7 of this Work Letter, shall be submitted to arbitration in accordance
with the provisions of applicable state law, as from time to time amended.
Notwithstanding anything to the contrary, (i) in the event of any arbitration
proceeding between either Landlord or Tenant and
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the Contractor, arising out of or relating to the construction of the Building
or any portion thereof, the parties agree that each party may join the other,
where appropriate, in any such proceedings, and that such proceedings may be
consolidated with any proceedings between Tenant and Landlord under this Article
14 as necessary to avoid inconsistent results under Article 14 and either
party's arbitration with the Contractor, and (ii) the parties may make persons,
other than the other of them, participants in any arbitration proceeding
hereunder with respect to any claim, dispute or other matter in question arising
out of the construction of the Building. Arbitration proceedings, including the
selection of an arbitrator or arbitrators (unless the parties agree on the
identity thereof), shall be conducted pursuant to the construction industry
arbitration rules from time to time in effect as promulgated by the American
Arbitration Association. Prior written notice of application by either party for
arbitration shall be given to the other at least ten (10) business days before
submission of the application to the said Association's office in Boston,
Massachusetts. The arbitrator shall hear the parties and their evidence. The
decision of the arbitrator shall be binding and conclusive, and judgment upon
the award or decision of the arbitrator may be entered in the appropriate court
of law; and the parties consent to the jurisdiction of such court and further
agree that any process or notice of motion or other application to the Court or
a Judge thereof may be served outside the Commonwealth of Massachusetts by
registered mail or by personal service, provided a reasonable time for
appearance is allowed. The costs and expenses of each arbitration hereunder and
their apportionment between the parties shall be determined by the arbitrator in
his award or decision. Except where a specified period is referenced in this
Work Letter, no arbitrable dispute shall be deemed to have arisen under this
Work Letter prior to the expiration of the period of twenty (20) days after the
date of the giving of written notice by the party asserting the existence of the
dispute together with a description thereof sufficient for an understanding
thereof.
ARTICLE 15
CONSTRUCTION SECURITY
Section 15.1 In order to secure Landlord's obligations to construct the
Base Building Improvements, in accordance with the Construction Project
Schedule, Landlord agrees to execute and deliver to Tenant on or before the
closing of Landlord's construction loan, a completion guaranty in the same form
as Landlord will be giving to its construction lender, which is anticipated to
be in substantially the form of SCHEDULE C5, with such changes as may be
reasonably requested by Landlord's construction lender and/or ground lessor.
Section 15.2 In order to secure Tenant's obligations to construct and pay
for the costs of the Tenant Construction Work, in accordance with the
Construction Project Schedule, Tenant agrees to deliver to Landlord on or before
the earlier to occur of (i) the Steel Frame Completion Date or (ii) the date
upon which Tenant requisitions its first advance of the Leasehold Improvements
Allowance, Three Million Dollars ($3,000,000) (the "TI Security Deposit").
Notwithstanding the foregoing, Landlord may accelerate the date upon which
Tenant delivers to Landlord the TI Security Deposit (the "Accelerated TI
Security Deposit Date") to a date earlier
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than the date specified in the immediately preceding sentence (the "Original TI
Security Deposit Date") by five (5) business days' advance written notice to
Tenant provided that, if Landlord does so, Landlord shall reimburse Tenant an
amount equal to the product of the first year's annual fee associated with
obtaining a letter of credit for the TI Security Deposit multiplied by a
fraction, the numerator of which is the number of days from the Accelerated TI
Security Deposit Date to the day prior to the Original TI Security Deposit Date,
and the denominator of which is 365. The TI Security Deposit may be made and
maintained by the Tenant, at its election, either in the form of a clean,
unconditional and irrevocable letter of credit in form and substance reasonably
satisfactory in all respects to Landlord, and from a commercial bank having an
AA rating by Standard and Poors or from an institution that is a wholly owned
subsidiary of a bank having an AA rating by Standard and Poors (it being agreed
that Fleet National Bank, as issuer of a letter of credit, shall be
substantially satisfactory for all purposes hereunder) or in cash. Landlord or
the construction lender shall have the right to draw on the TI Security Deposit
if Tenant defaults beyond applicable grace and cure periods on its obligations
under this Work Letter prior to completion of construction of the Base Building
Improvements and Leasehold Improvements.
Section 15.3 If and to the extent the TI Security Deposit is held in the
form of a letter of credit, Landlord may pledge its right, title and interest in
and to such letter of credit to any mortgagee or ground lessor and, in order to
perfect such pledge, have such letter of credit held in escrow by such mortgagee
or ground lessee. If and to the extent the TI Security Deposit is held in the
form of cash, the Landlord may pledge its right and interest in and to such cash
to any mortgagee or ground lessor and, in order to perfect such pledge, have
such cash held in escrow by such mortgagee or ground lessee or grant such
mortgagee or ground lessee a security interest therein.
Section 15.4 In connection with any such pledge or grant of security
interest by the Landlord to a mortgagee or ground lessee ("Security Deposit
Pledgee"), Tenant covenants and agrees to cooperate as reasonably requested by
Landlord, in order to permit Landlord to implement the same on terms and
conditions reasonably required by such mortgagee or ground lessee including,
without limitation, providing in any letter of credit that Tenant elects to give
under this Article 15 any necessary and appropriate language that will permit
the implementation of such pledge. If and to the extent the TI Security Deposit
is held in the form of cash, and whether or not a Security Deposit Pledgee shall
have a security interest therein, such cash, together with the Tenant's
Construction Escrow, shall be deposited in a separately maintained and accounted
escrow account established with a bank or other financial institution reasonably
acceptable to the Tenant (the "Escrow Holder"), and all monies held therein
shall be invested and reinvested by the Escrow Holder in the name of the Escrow
Holder or its nominee in cash equivalents or other investments selected by
Tenant and approved by the Landlord and the Escrow Holder. Unless and until an
Event of Default by Tenant occurs pursuant to the Work Letter, all interest
earned on the TI Security Deposit shall be paid annually to Tenant; from and
after the date of any Event of Default by Tenant, interest (including accrued
interest) shall become part of the TI Security Deposit. Tenant agrees that any
Security Deposit Pledgee may be
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the Escrow Holder so long as the Security Deposit Pledgee is a bank, pension
fund or other financial institution.
Section 15.5 Landlord and Tenant agree that a separate three-party escrow
agreement, in form and substance satisfactory to Landlord, Tenant and Escrow
Holder, will be entered into prior to the date upon which Tenant may deposit any
sums in cash, and Tenant agrees to reasonably cooperate from time to time as
requested by Landlord in order to effectuate the holding of any cash amount,
whether Tenant's Construction Escrow or the TI Security Deposit by the Escrow
Holder in accordance with terms and conditions reasonably required by such
Escrow Holder. Notwithstanding anything in this Lease to the contrary, the TI
Security Deposit and Tenant's Construction Escrow shall at all times constitute
the property of Tenant and title to the TI Security Deposit and Tenant's
Construction Escrow shall remain with the Tenant, subject to the aforementioned
pledge to a mortgagee or ground lessor. To the extent, if any, the TI Security
Deposit or Tenant's Construction Escrow is deemed to be held by Landlord it
shall be deemed to be held in trust for the benefit of Tenant, in all cases,
subject however to Landlord's rights pursuant to this Article 15.
Section 15.6 Neither Tenant's Construction Escrow nor the TI Security
Deposit shall be available for use for any reason other than in accordance with
the exercise of Landlord's rights pursuant to this Work Letter. Upon completion
of Tenant's Construction Work in accordance with the Construction Project
Schedule and payment of all costs in connection therewith, to the extent not
expended in accordance with this Work Letter, Tenant's Cash Escrow and the TI
Security Deposit shall be returned to Tenant.
ARTICLE 16
LEASE TERMINATION RIGHTS
Section 16.1 Notwithstanding anything to the contrary provided in this
Lease, Tenant and Landlord shall each have the right, in accordance with the
terms of this Section 16.1, to terminate the Lease in the event that the
erection of the steel frame of the Building shall not have commenced on or
before August 1, 2001, as such date may be extended, insofar as Tenant's right
to exercise termination rights under this Section 16.1, for the duration of any
period with respect to which Landlord's fulfillment of this milestone is delayed
due to Tenant Delay (the "Steel Frame Commencement Drop Dead Date"). Any
termination as set forth herein shall become effective immediately upon receipt
by Landlord of Tenant's notice properly exercising Tenant's termination right,
or upon receipt by Tenant of Landlord's notice properly exercising Landlord's
termination right, in accordance with this Section 16.1 on or before the Steel
Frame Commencement Drop Dead Date applicable to such party. Landlord agrees to
exercise commercially reasonable efforts to cause the commencement of erection
of the steel frame of the Building to be achieved on or before the Steel Frame
Commencement Drop Dead Date. If either party shall not have given termination
notice to the other under this Section 16.1 on or before the tenth (10th) day
following the occurrence of the Steel Frame Commencement Drop Dead Date, then
such party's right to terminate the Lease under this Section 16.1 shall
automatically expire
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and be of no further force or effect. Upon any termination of the Lease under
this Section 16.1, neither party shall have any further rights or obligations
under the Lease or this Work Letter, which shall have no further force or
effect.
Section 16.2 Notwithstanding anything to the contrary provided in the
Lease, Tenant shall have the right, in accordance with the terms of this Section
16.2, to terminate the Lease in the event that the Steel Frame Completion Date
has not been achieved by February 3, 2001, as such date may be extended for the
duration of any period with respect to which Landlord's fulfillment of the
conditions to the Steel Frame Completion Date is delayed due to Tenant Delay
(the "Steel Frame Completion Drop Dead Date"). Any termination as set forth
herein shall become effective immediately upon receipt by Landlord of Tenant's
notice properly exercising Tenant's termination right under this Section 16.2;
provided, however, that if Tenant has not given such termination notice to
Landlord on or before the tenth (10th) day following the occurrence of the Steel
Frame Completion Drop Dead Date, then Tenant's right to terminate the Lease
under this Section 16.2 shall automatically expire and be of no further force
and effect. Upon any termination of the Lease under this Section 16.2, neither
party shall have any further rights or obligations under the Lease or this Work
Letter, which shall have no further force or effect.
Section 16.3 Notwithstanding anything to the contrary provided in the
Lease, Tenant shall have the right, in accordance with the terms of this Section
16.3, to terminate the Lease in the event that the Substantial Completion of the
Base Building Improvements is not achieved by August 1, 2003, as such date may
be extended for the duration of any period with respect to which Landlord's
fulfillment of the conditions to the Substantial Completion of the Base Building
Improvements is delayed due to Tenant Delay (the "Substantial Completion Drop
Dead Date"). However, if Landlord reasonably determines at any time, and from
time to time, based upon certification of its architect or other design
professional, that Substantial Completion of the Base Building Improvements will
not be able to be completed before the Substantial Completion Drop Dead Date,
and Landlord specifies in a notice to Tenant to such effect a later date that
Landlord estimates will be the date upon which Substantial Completion of the
Base Building Improvements will occur, then Tenant may terminate the Lease
within ten (10) days of Landlord's notice as aforesaid, failing which the
Substantial Completion Drop Dead Date shall be extended, to the date set forth
in Landlord's notice (as extended by delay due to Tenant Delay). Any termination
as set forth herein shall become effective immediately upon receipt by Landlord
of Tenant's notice properly exercising Tenant's termination right under this
Section 16.3, provided that if Tenant has not given such termination notice to
Landlord on or before the tenth (10th) day following the occurrence of the
Substantial Completion Drop Dead Date, then Tenant's right to terminate the
Lease under this Section 16.3 shall automatically expire and be of no further
force or effect. Upon any termination of the Lease under this Section 16.3,
neither party shall have any further rights or obligations under the Lease or
this Work Letter, which shall have no further force or effect.
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ARTICLE 17
RENT ABATEMENT ASSOCIATED WITH LANDLORD'S FAILURE TO TIMELY
ACHIEVE SUBSTANTIAL COMPLETION OF BASE BUILDING IMPROVEMENTS
If Substantial Completion of the Base Building Improvements does not occur
on or before the Scheduled Rent Commencement Date, as such date shall be
postponed by the period of any delay in Landlord's fulfilling the conditions to
Substantial Completion of the Base Building Improvements due to Excusable Delay
or Tenant Delay ("Deadline Date"), then Tenant shall be entitled, as liquidated
damages, commencing on the Rent Commencement Date, to one and one-half days of
rent abatement for each day, less than sixty (60) days in the aggregate,
following the Deadline Date until Substantial Completion of the Base Building
Improvements has occurred. In the event of such delay exceeding sixty (60) days
in the aggregate, the aforesaid rent abatement shall be increased to two (2)
days of rent abatement for each day of delay in excess of the first sixty (60)
days of such delay.
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EXHIBIT D
STANDARD SERVICES
The building standard services shall be defined by the Landlord and its
Management Agent, together with the Tenant, subject to the limitations set forth
below.
The following services will be provided exclusively by the Landlord and may
not be undertaken by the Tenant:
A. Regular maintenance of exterior and parking lot landscaping and
University Park common areas.
B. Regular maintenance, sweeping and snow removal of building exterior
areas such as roadways, driveways, sidewalks, parking areas and
courtyard paving.
C. Maintenance and repair of base building surveillance and alarm
equipment, base building elevators, base building mechanical,
electrical and plumbing systems, and base building life safety
systems.
D. Building surveillance and alarm system operation and the Landlord's
live monitoring service to building standard specifications.
E. Complete interior and exterior cleaning of all windows two times per
year.
The following services will be provided by the Landlord unless the Tenant
elects to cause such services to be performed in whole or in part:
F. Daily, weekday maintenance of hallways, passenger elevators,
bathrooms, lobby areas and vestibules.
G. Periodic cleaning of stairwells, freight elevators, and back of house
areas.
H. Daily, weekday rubbish removal of all tenant trash receptacles.
I. Daily, weekday cleaning of Tenant space to building standard.
J. Surveillance personnel having a desk in the building lobby.
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EXHIBIT E
RULES AND REGULATIONS
DEFINITIONS
Wherever in these Rules and Regulations the word "Tenant" is used, it shall
be taken to apply to and include the Tenant and its agents, employees, invitees,
licensees, contractors, any subtenants and is to be deemed of such number and
gender as the circumstances require. The word "Premises" is to be taken to
include the space covered by the Lease. The word "Landlord" shall be taken to
include the employees and agents of Landlord. Other capitalized terms used but
not defined herein shall have the meanings set forth in the Lease.
The following Rules and Regulations apply to buildings that are wholly occupied
by a single tenant.
A. No actions shall be taken by Tenant that modify the exterior
appearance of the Premises or the Building, unless expressly permitted
by the Lease or the Landlord.
B. No blinds, shades, awnings or other window treatments shall be placed
or installed in windows or curtain wall glazing other than those
approved and installed as Building Standard.
C. No sign, advertisement, notice or the like, shall be posted on the
Building exterior, in windows visible from the exterior of the
building, or in the building lobby except as permitted under the terms
of the Lease or as reasonable necessary in the operation of Tenant's
business without prior approval of Landlord, not to be unreasonably
withheld.
D. The Building lobby shall be open to the public during normal business
hours (at a minimum 9:00 a.m. through 5:00 p.m., Monday through Friday
except legal holidays). Tenant shall be responsible for locking of
doors to the Premises. All locksets shall accept the Best key system.
If the Building key system is maintained by Tenant, designated
representatives of Landlord shall be provided with keys and/or access
cards so as to facilitate access to all spaces within the Building in
case of emergency. No locks or similar devices not on the master key
system shall be attached to any doors.
E. All deliveries to the Building, other than envelopes and small
packages that can legitimately be delivered by hand or bicycle courier
service, shall be accepted only through the building loading dock and
not through the main lobby.
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F. Bicycles may only be stored in designated bicycle racks provided in
University Park garages or elsewhere on the grounds of University
Park. Bicycles shall not be fastened to fences, signposts, or other
non-designated equipment, nor shall bicycles or vehicles of any kind
shall be brought into or kept in or about the building lobby or the
Premises.
G. Tenant shall not cause or permit any unusual or objectionable odors,
noises or vibrations to emanate from said Premises.
H. No pets or other animals, excepting those used for research purposes
or by a disabled person, shall be permitted in or about the Building
or the grounds of the Park.
I. Unless specifically authorized by Landlord, employees or agents of
Landlord shall not perform for nor be asked by Tenant to perform work
other than their regularly assigned duties.
J. Canvassing, soliciting and peddling in the Building is prohibited and
Tenant shall cooperate to prevent the same from occurring.
K. Access roads and loading areas, parking areas, sidewalks, entrances,
lobbies, halls, walkways, elevators, stairways and other common area
provided by Landlord shall not be obstructed by Tenant, or used for
other purpose than for ingress and egress.
L. Landlord shall have the right to make such other and further
reasonable rules and regulations as in the judgment of Landlord, may
from time to time be needed for the safety, appearance, care and
cleanliness of the Building or the park and for the preservation of
good order therein. All reasonable parking, building operation, or
construction rules and regulations which may be established from time
to time by Landlord and enforced on a uniform basis (i.e.
non-discriminatory) shall be respected and obeyed, subject to the
requirements of this Lease.
M. Landlord shall not be responsible to Tenant for any violation of rules
and regulations by other tenants except that Landlord shall use good
faith efforts to uniformly enforce such rules and regulations.
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EXHIBIT F
MEASUREMENT METHOD
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EXHIBIT G
FORM OF MIT NON-DISTURBANCE AGREEMENT
Agreement dated as of ________ __, 2000 (this "Agreement"), by and between
MASSACHUSETTS INSTITUTE OF TECHNOLOGY, a Massachusetts educational corporation
chartered by Massachusetts law (the "Ground Lessor"), FC 88 SIDNEY, INC., a
Massachusetts corporation ("Landlord") and ALKERMES, INC., a Pennsylvania
corporation ("Tenant").
BACKGROUND
Ground Lessor and Landlord are parties, as landlord and tenant
respectively, to a Construction and Lease Agreement ("Ground Lease") dated
________________, 2000, for certain real property located at 88 Sidney Street in
Cambridge, Massachusetts, as more particularly described on EXHIBIT A attached
hereto ("Land"). A Notice of Lease pertaining to the Ground Lease has been
recorded at the Middlesex South District Registry of Deeds and filed for
registration in the Middlesex South Registry District of the Land Court.
Landlord intends to construct a building (the "Building") on the Land. Tenant
has entered into a lease dated as of _______________, 2000 ("Lease") with
Landlord for certain premises in the Building ("Premises"), the Premises being
more particularly described in the Lease.
AGREEMENTS
1. NON-DISTURBANCE. If the Ground Lease is terminated, for any reason,
Ground Lessor shall not disturb Tenant in Tenant's possession of the Premises
and without any hindrance or interference from the Ground Lessor, shall permit
Tenant peaceably to hold and enjoy the Premises for the remainder of the
unexpired term of the Lease, together with any extension periods provided for
therein, upon and subject to the same terms, covenants and conditions as are
contained in the Lease, and shall recognize the Lease as modified hereby. The
foregoing is on the condition that Tenant is not in default under the Lease
beyond any applicable notice and grace periods contained in the Lease.
2. ATTORNMENT. Tenant hereby agrees that if the Ground Lease is terminated
for any reason, Tenant shall attorn to Ground Lessor and shall be liable to and
recognize Ground Lessor as Landlord under the Lease for the balance of the term
of the Lease upon and subject to all of the terms and conditions thereof. In
such case, upon receipt of notice from Ground Lessor setting forth the effective
date of the termination of the Ground Lease, Tenant shall pay to the Ground
Lessor all obligations required to be paid and performed by Tenant under the
Lease arising after the date of termination. The Lease shall continue in full
force and effect as a direct lease between Ground Lessor and Tenant.
3. ADDITIONAL CONDITIONS. Tenant agrees that Ground Lessor shall not be:
(i) liable for any act or omission of any person or party who may be landlord
under the Lease prior to any
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termination of the Ground Lease ("Prior Landlord"); (ii) subject to any offsets
or defenses which Tenant might have against Prior Landlord; (iii) bound by any
prepayment of rent or additional rent, or any other charge which Tenant might
have paid to Prior Landlord for more than the then current month (other than a
bona fide security deposit paid by Tenant to Landlord under the Lease, estimated
monthly payments made on account of additional rent as and when required to be
made pursuant to the provisions of the Lease, or other rent, additional rent or
charges which have been received by Ground Lessor); and (iv) bound by any
amendment, modification or termination of the Lease made without Ground Lessor's
express agreement when such agreement is required under the Ground Lease. Tenant
additionally agrees with Ground Lessor that Tenant shall not enter into any
assignment of the Lease or sublease of all or any part of the Premises in cases
where Landlord's consent is required thereto, unless Ground Lessor shall have
also given its consent thereto, which consent shall not be unreasonably withheld
or delayed. Nothing herein, however, shall constitute a waiver of Tenant's
rights as against such individual or entity which is the landlord under the
Lease as of the time of any event or circumstances which may give rise to a
claim of the Tenant against such individual or entity. In addition, nothing
herein shall relieve any successor landlord under the Lease from its obligation
to comply with those obligations of a Landlord under the Lease during the period
for which it is the owner of the Landlord's interest in the Lease.
4. LANDLORD'S DEFAULTS. Tenant hereby agrees that, if Tenant provides
Landlord with any notice of default or claimed default on the part of Landlord
under the Lease, Tenant shall concurrently therewith send a copy of such notice
to Ground Lessor. In such event, Ground Lessor shall be permitted (but not
obligated) to cure any such default within the period of time allotted thereto
in the Lease. If Landlord shall fail to cure such default within the period of
time allocated thereto in the Lease (or, if Landlord shall not within such time
period have commenced diligent efforts to remedy a default that cannot be fully
cured within such time period) then Tenant shall provide Ground Lessor with
notice of such failure. Upon receipt of such notice of Landlord's failure to
cure, Ground Lessor shall be granted an additional thirty (30) days during which
it shall be permitted (but not obligated) to cure such default. In the case of a
default, which cannot with diligence be remedied by Ground Lessor within thirty
(30) days, Ground Lessor shall have such additional period of time as may be
reasonably necessary in order for Ground Lessor to remedy such default with
diligence and continuity of effort, provided that Ground Lessor has commenced to
cure such default within such thirty (30) day period.
5. NOTICES. Duplicates of all notices delivered by any party to another
party and required by this Agreement shall be delivered concurrently to all
other parties to this Agreement. All notices shall be written, delivered by
certified or registered mail, and sent, if to Ground Lessor, to 238 Main Street,
Suite 200, Cambridge, Massachusetts 02142, Attention: Director of Real Estate,
if to Tenant to 64 Sidney Street, Cambridge, Massachusetts 02139-4211,
Attention: James M. Frates, Chief Financial Officer, before the commencement of
Tenant's occupancy in the Premises, and to the Premises after the Rent
Commencement Date shall have occurred with respect to the entire Original
Premises, and if to Landlord to 38 Sidney Street, Cambridge, MA 02139-4234,
Attention: Ms. Gayle B. Farris, or such addresses as may, from time to time, be
set forth in notices to the other parties hereunder.
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6. EXCULPATION OF GROUND LESSOR. Ground Lessor shall not be personally
liable hereunder. Tenant agrees to look to Ground Lessor's interest in the Land
and Building only for satisfaction of any claim against Ground Lessor hereunder.
7. SUCCESSORS AND ASSIGNS. This Agreement shall bind Tenant, its successors
and assigns, and shall benefit Tenant and only such successor and assigns of
Tenant as are permitted by the Lease and shall bind and benefit Ground Lessor
and its successors and assigns (provided that after transfer of Ground Lessor's
entire interest in the Land to another party, Ground Lessor shall have no
liability for any act or omission of such party) and shall bind and benefit
Landlord and its successors and assigns.
EXECUTED as an instrument under seal as of the date set forth above.
MASSACHUSETTS INSTITUTE OF
TECHNOLOGY
Ground Lessor
By:
---------------------------
ALKERMES, INC.
Tenant
By:
----------------------------
FC 88 SIDNEY, INC.
Landlord
By:
----------------------------
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COMMONWEALTH OF MASSACHUSETTS )
) ss:
COUNTY OF MIDDLESEX )
BEFORE ME, a Notary Public in and for said County and State, personally
appeared the MASSACHUSETTS INSTITUTE OF TECHNOLOGY, by _____________, its
Director of Real Estate and Associate Treasurer, who acknowledged that he did
sign the foregoing instrument and that the same is his free act and deed and the
free act and deed of said corporation.
IN TESTIMONY HEREOF, I set my hand and official seal at __________________,
this _____ day of _______________, ____.
---------------------------
Notary Public
My Commission Expires:
-----
COMMONWEALTH OF MASSACHUSETTS )
) ss:
COUNTY OF MIDDLESEX )
BEFORE ME, a Notary Public in and for said County and State, personally
appeared the above-named ALKERMES, INC., by ______________________ who
acknowledged that he/she did sign the foregoing instrument and that the same is
his/her free act and deed and the free act and deed of said corporation.
IN TESTIMONY HEREOF, I set my hand and official seal at __________________,
this _____ day of _______________, ____.
-----------------------------
Notary Public
My Commission Expires:
------
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<PAGE> 98
COMMONWEALTH OF MASSACHUSETTS )
) ss:
COUNTY OF MIDDLESEX )
BEFORE ME, a Notary Public in and for said County and State, personally
appeared the above-named FC 88 SIDNEY, INC., by _______________________ who
acknowledged that he/she did sign the foregoing instrument and that the same is
his/her free act and deed and the free act and deed of said corporation.
IN TESTIMONY HEREOF, I set my hand and official seal at __________________,
this _____ day of _______________, ____.
-----------------------------
Notary Public
My Commission Expires:
-------
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<PAGE> 99
EXHIBIT H
INTENTIONALLY OMITTED
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<PAGE> 100
EXHIBIT I
EXPEDITED DISPUTE RESOLUTION PROCEDURE
Any dispute or determination by a party hereto which, pursuant to the terms
of this Lease, may be resolved by the "Expedited Dispute Resolution Procedure,"
shall be undertaken in accordance with the following provisions:
(a) In the event of any such dispute, the complaining party (the
"Claimant") shall serve upon the other party (the "Respondent") by registered
mail or hand delivery a written demand for arbitration (the "Dispute Notice"),
setting forth with particularity the nature of the dispute. The Claimant shall
simultaneously serve any request (the "Document Request") for production of
relevant documents from the Respondent. The service of such Dispute Notice and
Document Request shall be effective upon receipt thereof. Failure to serve a
Document Request shall constitute a waiver by the Claimant of any right to
demand documents from the Respondent, except as provided in Subparagraph (c)
below. The Dispute Notice shall also be delivered to J.A.M.S./Endispute, 73
Tremont Street, 4th floor, Boston, Massachusetts 02108, for mediation as part of
that firm's national mediation services expertise. J.A.M.S./Endispute shall
select a member of the company to conduct the arbitration (hereinafter the
"Arbitrator"), the choice of which shall be binding on the parties. If
J.A.M.S./Endispute believes it has a material conflict of interest with any of
the parties, it shall select an alternative nationally recognized firm to
conduct the arbitration, within ten (10) business days of receipt of the Dispute
Notice. If J.A.M.S./Endispute shall cease to exist and/or shall decline to serve
under this Lease as to all or any particular dispute submitted thereto for
arbitration, and within ten (10) business days of receipt of a Dispute Notice,
shall fail to select an alternative nationally recognized firm, then, and in any
such event, the parties shall mutually select an alternative arbitrator for
their dispute(s) and, in the absence of agreement within a period of ten (10)
days, either party shall have the right, on notice to the other, to apply to the
President of the Boston Bar Association for selection of an independent
arbitrator.
(b) RESPONSE BY RESPONDENT. Within ten (10) business days of receipt of a
Dispute Notice and Document Request, the Respondent shall serve a detailed
written response to the Dispute Notice, including any arbitrable counterclaims,
and shall produce all non-privileged documents called for in the Document
Request. At the same time, Respondent shall serve any Document Request on
Claimant, failing which Respondent shall be deemed to have waived any right to
demand documents from Claimant. Within two (2) business days of delivery of the
response, all undisputed amounts shall be paid by Respondent by wire transfer.
(c) RESPONSE BY CLAIMANT. Within ten (10) business days of receipt of such
written response, the Claimant shall serve a reply to any counterclaims asserted
by Respondent and shall produce all non-privileged documents requested by
Respondent. At the same time, the Claimant may serve a second Document Request
limited to documents relevant to Respondent's
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counterclaim. Within two (2) business days of delivery of the reply to any
counterclaims, all undisputed amounts shall be paid by the Claimant by wire
transfer.
(d) RESPONSE BY RESPONDENT. Respondent shall produce all non-privileged
documents called for in any such second Document Request within ten (10)
business days of service thereof.
(e) APPEARANCE BEFORE ARBITRATOR. Within thirty-five (35) business days of
service of the Dispute Notice, any arbitrable dispute shall be submitted to the
Arbitrator, whose decision shall be final, binding and non-appealable, and may
be entered and enforced as a judgment by any court of competent jurisdiction.
The Arbitrator shall consider and determine only matters properly subject to
arbitration pursuant to this Lease.
The Arbitrator shall, in consultation with the parties, establish such
further procedures, including hearings, as he or she deems appropriate,
provided, however, that a decision of the dispute (including counterclaims)
shall be rendered no later than sixty (60) business days after service of the
Dispute Notice.
(f) FINAL DECISION; FEES AND EXPENSES. The Arbitrator's decision shall be
in writing, and shall include findings of fact and a concise explanation of the
reasons for the decision. The decision shall be delivered to the parties
immediately. The Arbitrator's fees and expenses shall be borne by one or both of
the parties in accordance with the direction of the Arbitrator, who shall be
guided in such determination by the results of the arbitration. If any party
refuses to appear before the Arbitrator or to respond as required in
subparagraphs (a) through (e) above, the Arbitrator shall decide the matter as
by default against the non-appearing party, and such decision shall be final,
binding and non-appealable to the same extent as a decision rendered with the
full participation of such party.
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EXHIBIT J
TENANT REMOVABLE EQUIPMENT
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