**Exhibit 2.1**

 

**PURCHASE AND SALE AGREEMENT**

 

 

**BETWEEN**

 

 

**SUMMER INFANT (USA), INC.**

**AS SELLER**

 

**AND**

 

# **FAITHREALTY II, LLC**

**AS PURCHASER**

 

 

**DATED**

# ** **

# **MARCH 24,2009**

 

----

 

----

 

**PURCHASE AND SALE AGREEMENT**

 

**THIS PURCHASE AND SALE AGREEMENT** (“Agreement”) dated                             this    day of March, 2009, is made by and between **Summer Infant (USA), Inc.,**a Rhode Island corporation (“Seller”)having a principal mailing address at 1275 Park East Drive, Woonsocket, RhodeIsland 02895, and **Faith Realty II, LLC,**aRhode Island limited liability company (the “Purchaser”), or its nominee,having a principal mailing address at 10 Hannah Drive, Cumberland, Rhode Island02864.

 

1.                                       **CONVEYANCE**.       Seller agrees to sell andconvey to Purchaser and Purchaser agrees to purchase from Seller, fee simpleinterest to the real estate located in the County of Providence, in the City ofWoonsocket, State of Rhode Island, commonly known as 1275 Park East Drive,Woonsocket, Rhode Island, and more particularly described in Exhibit Aattached hereto and made a part hereof, together with (a) all rights,easements and appurtenances belonging or appertaining thereto, (b) allright, title and interest of Seller in and to any and all roads, streets,alleys or public and private rights of way, bounding such property and (c) allbuildings, improvements and  fixturesattached to the real estate (collectively the “Property”).

 

2.                                       **PURCHASEPRICE**.                                  The purchaseprice is Four Million Fifty Two Thousand Five Hundred and 00/100 Dollars($4,052,500.00) (the “Purchase Price”).

 

3.                                       **SURVEY;TITLE INSURANCE****.**

 

(a)                                  Purchaser will, at Purchaser’s sole costand expense, obtain a preliminary title report for the Property (“Title Report”).Purchaser may also obtain, at Purchaser’s sole cost and expense, a survey ofthe Property (“Survey”). If the Title Report or Survey discloses any matter,other than those matter set forth on Exhibit B, attached hereto(collectively the “Existing Encumbrances”), which needs to be released orremoved in order for good and marketable title to the Property to be conveyedto Purchaser in accordance with the provisions of this Agreement  (other than release or satisfaction of anymortgage or security interest granted by the Seller with respect to the Property,which Seller agrees to release or satisfy at the Closing) or any encroachmentor other matter unacceptable to Purchaser’s title company or lender, thenwithin twenty (20) business days following the execution date of this Agreement, TIME BEING OF THEESSENCE, Purchaser will notify Seller in writing of such matter (a “Title/SurveyObjection”). The failure of Purchaser to give notice to Seller within twenty(20) business days following the execution date of this Agreement of any matter(other than those which arise after the 20 business day period and could nothave been determined by searching applicable public records within the 20business day period) to which Purchaser has objection shall constitute anirrevocable waiver of Purchaser’s right to raise such matters as a Title/SurveyObjection. Upon receipt of a timely notice of a Title/Survey Objection, Sellerwill undertake such steps as Seller, acting in good faith, deems reasonableunder the circumstance either (i) to cause such Title/Survey Objection tobe released or satisfied or (ii) to induce the title insurance companywhich issued the Title Report to issue a title policy to Purchaser without theTitle/Survey Objection, it being understood that Seller shall have noobligation whatsoever to expend any sum or undertake any actual or potentialliability in excess of $5,000.00 in connection therewith. If at the Closing,any Title/Survey Objection has not been released or removed despite Seller’sgood faith efforts as aforesaid, then Purchaser shall have the option toeither, (i) terminate this 

 

----

 

Agreement forthwith (in which event the Deposit shallbe repaid to the Purchaser), or (ii) accept title to the Property subjectto the Title/Survey Objections without any change in the Purchase Price;

 

(b)                                  Seller willconvey the Property by Warranty Deed (the “Deed”), the form of which isattached hereto as Exhibit C. Notwithstanding the foregoing, Sellershall be required to cure (i) all existing monetary liens and (ii) anyand all encumbrances created by Seller after the 20 business day period referredto in subsection (a) above, at Seller’s sole cost and expense.  Seller’s failure to cure such defects shallbe a default by Seller hereunder. For purposes hereof, “Permitted Exceptions”shall be defined as (i) the lien of any real estate taxes which are notyet due and payable, (ii) easements, restrictions, reservations, liens andencumbrances of record, if any, (iii) building and use restrictions ofrecord, (iv) any charges or installments for municipal improvements notassessed and due and payable as of the date of this Agreement, (v) andsuch other matters as Purchaser shall specifically approve in writing prior tothe Closing and (vi) the Existing Exceptions.

 

4.                                       **INSPECTIONPERIOD AND CONDITIONS PRECEDENT****.**

 

(a)                                  Prior toClosing, Purchaser, personally or through its authorized agents orrepresentatives, shall be entitled, at Purchaser’s sole cost and expense, toenter upon the Property at all reasonable times, upon prior notice to theBroker, in order to perform such investigations as Purchaser shall deemnecessary, including, without limitation, soil tests and environmental audits.Purchaser shall coordinate all access to the Property through Joseph Driscoll (“SellerRepresentative”) and shall provide to the Seller Representative the identity of the parties accessing theProperty, the purpose for such access and the nature of the tests and/orinspections to be performed. Purchaser will promptly repair and restoreany damage or injury to the Property caused by such investigations. Purchasershall not permit any liens or encumbrances to arise against the Property inconnection with or as a result of such inspections, studies orinvestigations.  Purchaser shallindemnify, defend and hold Seller and the Property harmless of and from any andall losses, liabilities, costs, expenses (including without limitationreasonable attorneys’ fees and costs of court), damages, liens, claims(including without limitation mechanics’ or materialmen’s liens or claims ofliens), actions and causes of action arising from or relating to Purchaser’s(or Purchaser’s agents, employees or representatives) entering upon theProperty to test, study, investigate or inspect the Property, whether pursuantto this Section 4 (a) or otherwise. The provisions of this Section 4(a) shall survive the deliveryof the Deed and the consummation of the transactions contemplated by thisAgreement.

 

(b)                                 Purchaser shall have twenty (20) businessdays from the date of the execution of this Agreement (the “Inspection Period”),within which to make all reviews, inspections, audits, or investigationsdesired by Purchaser, including, without limitation, the following:

 

i.                                          Structural and mechanical inspections ofthe Property;

 

ii.                                       Environmental Site Assessment;

 

----

 

iii.                                    such other inspections and customary duediligence matters with respect to the Property that the Purchaser desires toperform including a determination that the Property is properly zoned forPurchaser’s intended  use; and

 

iv.                                   Any feasibility study that Purchase maydesire to perform in order to confirm, at Purchaser’s sole determination, thatthe Property is suitable for Purchaser’s intended use of the Property.

 

If the results of any inspection or test conducted at the Property isnot satisfactory to the Purchaser, then the Purchaser must notify the Seller,in writing, the reasons for such dissatisfaction, within the Inspection Period,TIME BEING OF THE ESSENCE. The failure of Purchaser to give notice to Sellerwithin the Inspection Period of any reason for said dissatisfaction resulting fromsuch tests or inspections shall constitute an irrevocable waiver of thiscontingency. Upon receipt of a timely notice from Purchaser of suchdissatisfaction, Seller will undertake such steps as Seller, acting in goodfaith, deems reasonable under the circumstance to cause such dissatisfaction tobe remedied, it being understood that Seller shall have no obligationwhatsoever to expend any sum or undertake any actual or potential liability inexcess of $5,000.00 in connection therewith. If at the Closing, any such reasonfor dissatisfaction has not been remedied despite Seller’s good faith effortsas aforesaid, then the Purchaser shall have the option of either (i) terminatingthis Agreement forthwith (in which event the Deposit shall be returned to the Purchaser),or (ii) accepting the Property subject to such reasons fordissatisfaction, without any reduction in the Purchase Price.

 

Except as otherwise set forth in this Agreement or inthe Deed, the Property is being sold to the Purchaser “AS IS”, “WHERE IS” and “WITHALL FAULTS”. The Purchaser acknowledges that it has the right to conductwhatever inspections it deems necessary and that the Seller is not making anyrepresentations, warranties or covenants of any kind, express or implied,unless specifically stated in this Agreement, including, without limitation,all zoning, land use and environmental laws, ordinances, and regulations.

 

5.                                       **INTENTIONALLY DELETED.**

 

6.                                       **SALE AND LEASE BACK.**                                              The obligations of the Seller and thePurchaser hereto are conditioned upon the parties, at the Closing, enteringinto a lease of the Property, pursuant to which the Purchaser will lease theProperty back to the Seller, on a net, net, net basis, for a term of seven (7) yearsand on such other terms and conditions, including the base monthly rent, as setforth in said lease. The lease shall be substantially in the form of Exhibit D,attached hereto and incorporated herein (the “Lease”).

 

7.                                       **EMINENTDOMAIN; DAMAGE**.                  If prior toClosing all or any part of the Property is condemned or appropriated by publicauthority or any party exercising the right of eminent domain, or is threatenedthereby, or if the buildings and improvements on the Property are destroyed ormaterially damaged by fire, windstorm, explosion or other casualty, Seller willgive Purchaser written notice thereof and Purchaser may, at its option: (1) terminatethis

 

----

 

Agreement and Purchaser shall be entitled to the return of the Depositand the parties shall be released from further liability; or (2) elect toproceed under this Agreement and, at Purchaser’s discretion, either (a) thePurchase Price shall be reduced by, or (b) Purchaser may take anassignment of, the amount of Seller’s award and/or insurance proceeds to whichSeller is entitled to receive.

 

8.                                       **INSURANCE; RISK OF LOSS****.**

 

(a)                                  Insurance.                                        Except as setforth in Section 4 (a), until the Closing and recording of the Deed,Seller shall bear the risk of loss and shall maintain Fire and ExtendedCoverage Insurance on the building and other structures located on the Propertyin such amount as presently insured.

 

(b)                                 Loss.                   Except as set forth in Section 4(a) or for any loss or damaged caused by the Purchaser or its agents,which loss or damage shall be the Purchaser’s obligation to repair or replace,if the Property or any portion thereof is damaged or destroyed prior to theClosing or if the Property or any portion thereof is taken by exercise ofeminent domain during such period, Purchaser may elect either: (i) toterminate this Agreement and any and all obligations to purchase the Property,by written notice to Seller, or (ii) to consummate the purchase of theproperty, with an abatement of the purchase price in the amount of theinsurance proceeds received by the Seller to replacement or repair the damageor destruction.

 

(c)                                  Notification ofDamage.                  Seller shallnotify Purchaser in writing promptly upon the occurrence of any damage,destruction, taking or threat of taking with respect tot he Property.

 

9.                                       **CLOSING****.**

 

(a)                                  Time.                                                                   Closing (hereinso called) shall take place at one o’clock (1:00) p.m. (EST) on March 24, 2009, at the law offices of Poore & Rosenbaum LLP, 30 ExchangeTerrace, Providence, RI 02903 or at such or time and place as the partiesagree.

 

(b)                                 Documents fromSeller.                     Seller shall,at Seller’s sole cost and expense, deliver at Closing the following executeddocuments in form and content acceptable to Purchaser:

 

(i)                                     Deed.                 A Rhode Island statutoryform Warranty Deed, conveying good, and marketable fee simple title subjectonly to the Permitted Exceptions.

 

(ii)                                  Affidavits.                                       such affidavitsas Purchaser or its Title Company may reasonable require.

 

(iii)                               ClosingStatement.                                            Two (2) signedcopies of a closing statement approved by Purchaser and Seller.

 

----

 

(iv)                              Authority.                                        Such evidenceor documents as may be reasonably required by Purchaser or the Title Companyevidencing the status and capacity of Seller and the authority of the person orpersons who are executing the various documents on behalf of Seller inconnection with the sale of the Property, including, but not limited to, a goodstanding certificate from the Secretary of State in which the Property islocated, and a good standing certificate from the Rhode Island Division ofTaxation and corporate resolutions, if applicable.

 

(v)                                 Lease.                                                              Two (2) signedoriginals of the Lease

 

(vi)                              Other Documents.                                               Such otherdocuments required by this Agreement and/or which Purchaser or the TitleCompany may reasonably require.

 

(c)                                  Documents fromPurchaser.                                             Purchaser shalldeliver at the Closing the following executed documents:

 

(i)                                     ClosingStatement.                                            Two (2) signedcopies of a closing statement approved by Seller and Purchaser.

 

(ii)                                  Authority.                                        To the extentthat Purchaser takes title to the Property in the name of a Nominee, then suchevidence or documents as may be reasonably required by Seller or the TitleCompany evidencing the status and capacity of Nominee and the authority of theperson or persons who are executing the various documents on behalf of Nomineein connection with the acquisition of the Property, including, but not limitedto, a good standing certificate from the Secretary of State in which theProperty is located and corporate resolutions, if applicable.

 

(iii)                               Lease.                                                              Two (2) signedoriginals of the Lease

 

(d)                                 Payment.                                               The PurchasePrice, subject to any applicable adjustments, or credits provided hereunder(including, without limitation, pro ration of real estate taxes or closingcosts) shall be paid in cash, by wire transferred funds or by any other meansas may be acceptable to both parties.

 

(e)                                  Real EstateTaxes.                                                Seller shallpay all taxes, general and special, and all special assessments against theProperty which have accrued and are a lien on the Property and are due andpayable prior to the Closing Date and Purchaser shall assume all of such taxesand assessments, and installments of unpaid special assessments (exclusive ofrebates and penalties) becoming due and payable and accruing thereafter. RealEstate taxes for the then current fiscal year shall be apportioned as follows:if the taxes are paid by Seller for a period going beyond the date of deliveryof the Deed, that portion shall be added to the Purchase Price payable byPurchaser; if taxes are unpaid for any portion of the fiscal year preceding thedelivery of the Deed, that portion shall be subtracted from the Purchase Priceand the obligation to pay such taxes assumed by the Purchaser. If the amount ofsuch tax or assessment to be prorated cannot then be ascertained, pro rationshall be computed on the amount thereof for the preceding year, 

 

----

 

witha reapportionment upon receipt of the tax bill for the current year. Theprovisions of this paragraph shall survive the Closing and delivery of theDeed.

 

(f)                                    Brokers.                                    Seller andPurchaser represent and warrant to each other that neither party had anydealings with any real estate brokers, finders or agents and no commissions orfees are payable in connection with this Agreement.  Seller agrees to indemnify, defend (withcounsel selected by Purchaser) and hold Purchaser, and Purchaser’s nominees,successors and assigns harmless from any and all claims, costs, commissions,fees or damages by any person or firm claiming to have negotiated, institutedor brought about this Agreement due to contact with Seller.  Purchaser agrees to indemnify, defend, withcounsel selected by Seller, and hold Seller and Seller’s nominees, successorsand assigns harmless from any and all claims, costs, commissions, fees ordamages by any person or firm claiming to have negotiated, instituted orbrought about this Agreement due to contact with Purchaser.  The provisions of this Section 9(f) shallsurvive the delivery of the Deed and the consummation of the transactionscontemplated by this Agreement

 

10.                                 **PLANS, SURVEY AND BLUEPRINTS****.**                             Copies of allblueprints and other plans of the building/Property which the Seller may havein its possession will be provided to Purchaser within ten (10) businessdays from the execution of this Agreement. The provisions of this Section 10 shall survive the delivery of theDeed and the consummation of the transactions contemplated by this Agreement

 

11.                                 **POSSESSION**.             The proposed transactioncontemplates a lease to the Seller and continued occupancy of the Property bythe Seller. Except for the Seller, its properties and possessions, possessionof the Property will be free from all tenancies, parties in possession andoccupants at the Closing.

 

12.                                 **NOTICE****.**                                              All notices,demands, or other communications of any type given, or required to be given,pursuant to this Agreement shall be in writing and shall be delivered to theperson to whom the notice is directed, either in person with a receiptrequested therefore, or sent by a recognized overnight service for next daydelivery or by United States certified mail, return receipt requested, postageprepaid to the addresses as follows:

 

If to Seller:

 

Summer Infant (USA), Inc.

1275 Park East Drive

Woonsocket, Rhode Island 02895

Attn: Joseph Driscoll

 

with a copy to:

 

Greenberg Truarig, LLP

One International Place, 20th Floor

Boston, MA. 02110

Attn: John Bello, Esquire

 

----

 

If to Purchaser:

 

Faith Realty II, LLC

10 Hannah Drive

Cumberland, Rhode Island 02864

Attn: Jason Macari

 

with copy to:

 

Poore & Rosenbaum LLP

30 Exchange Terrace

Providence, RI 20903

Attn: Steven Rosenbaum, Esquire

 

Any notice given by personal delivery, overnight delivery or courierdelivery service will be deemed effective when received.  Any notice given by United States Mail willbe deemed effective on the third (3rd) business day following deposit in theUnited States mail, postage prepaid, registered or certified mail, returnreceipt requested, addressed as set forth above.  Any notice that may be given by either partyin connection with this Agreement may be given by such party’s attorney.

 

13.                                 **REPRESENTATIONSAND WARRANTIES OF SELLER****.**                         To induce the Purchaser toexecute, deliver and perform this Agreement, Seller represents and warrants toPurchaser on the date hereof, which representations and warranties shall betrue and correct as of the Closing Date:

 

(a)                                  Title.                     Seller owns the Property infee simple, free of any liens, claims or encumbrances other than the PermittedExceptions.

 

(b)                                 Authorization.                 Seller has full capacity,right, power and authority to execute, deliver and perform this Agreement andall documents to be executed by Seller pursuant hereto, and all required actionand approvals therefore have been fully taken and obtained. The individualssigning this Agreement and all other documents executed or to be executedpursuant hereto on behalf of Seller are and shall be duly authorized to signthe same on Seller’s behalf and to bind Seller thereto.

 

(c)                                  Litigation.                                          There are noclaims, causes of action or other litigation or proceedings pending or, to thebest of Seller’s knowledge, threatened in respect to the ownership, operationor environmental conditions of the Property or any part thereof includingdisputes with mortgagees, governmental authorities, utility companies,contractors, adjoining land owners or suppliers of good or services).

 

----

 

(d)                                 Conflicts.                                             Neither theexecution and delivery of this Agreement nor the consummation of thetransaction contemplated herein will violate any provision of anyorganizational document of seller or any law, rule, regulation, writ, judgment,injunction, decree, determination, award, or other order of any court,government or governmental agency or instrumentality, domestic or foreign, orconflict with or result in nay breach of any of the terms of or constitute adefault under or result in the creation or imposition of any mortgage, pledgelien, security interest or other charge or encumbrance of any nature pursuantto the terms of any contract or agreement to which the Seller is a party or bywhich the Seller or the Property is bound.

 

(e)                                  Lease Back.                                 Seller will beduly authorized and will have full capacity, right, power and authority toenter into, to execute and deliver at the Closing the Lease.

 

**Seller is making no other representations orwarranties, express or implied, of any nature whatsoever with respect to theProperty, except the warranties of title specifically set forth in the Deed.**

 

14.                                 **REPRESENTATIONSAND WARRANTIES OF PURCHASER****.**                                            Purchaserrepresents and warrants to Seller on the date hereof which representations andwarranties shall be true and correct as of the Closing Date:

 

(a)                                  Authorization.                    The Purchaser has fullcapacity, right, power and authority to execute, deliver and perform thisAgreement and to purchase the Property from Seller. All documents to beexecuted by each Purchaser pursuant hereto, and all required action andapprovals therefore have been fully taken and obtained and this Agreement islegally binding on the Purchaser.

 

15.                                 **REMEDIESON DEFAULT****.**

 

(a)                                  Seller’sDefaults; Purchaser’s Remedies.                          In the event that Sellershall be in default hereunder, Purchaser may, as its sole option and exclusiveremedy for such default, deliver a written notice to Seller stating withparticularity the alleged default of Seller and the action required by Sellerto cure such default, and stating Purchaser’s intent to terminate thisAgreement if the default is not cured, whereupon Seller shall have five (5) businessdays after receipt of such notice in which to cure the alleged default toPurchaser’s reasonable satisfaction (and the Closing Date shall be delayed, if necessary,until the end of such five (5) business day period).  In the event such default is not cured withinsuch five (5) business day period, then Purchaser may proceed to terminatethis Agreement.

 

(b)                                 Purchaser’sDefault; Seller’s Remedies.                                In the event Purchaser shallbe in default hereunder, Seller may deliver a written notice to Purchaserstating with particularity the alleged default of Purchaser and the actionrequired by Purchaser to cure such default, and stating Seller’s intent toterminate this Agreement if the default is not cured, whereupon Purchaser shallhave five (5) business days after receipt of such notice in which to curethe alleged default to Seller’s reasonable satisfaction (and the Closing Dateshall be delayed, if necessary, until the end of such five (5) businessday period).  In the event such defaultis not 

 

----

 

cured within such five (5) business day period, then Seller mayterminate this Agreement by written notice delivered to Purchaser.

 

16.                                 **TITLEIN THE NAME OF A NOMINEE****.**                            The Purchaser shall have theright to take title to the Property in the name of a nominee, provided,however, that Jason Macari, shall have a controlling and majority interest in,over and to all ownership classes of such nominee. The nominee shall providesuch reasonable evidence as may be required by the Seller to evidencecompliance with the provisions hereof.

 

17.                                 **MISCELLANEOUS**.                                   No term orcondition of this Agreement will be deemed to have been waived or amendedunless expressed in writing, and the waiver of any condition or the breach ofany term will not be a waiver of any subsequent breach of the same or any otherterm or condition.  This Agreementconstitutes the entire agreement of the parties which incorporates andsupersedes all prior written and oral understandings.  This Agreement shall be binding upon, andinure to the benefit of, the parties, their heirs, executors, personalrepresentatives, nominees, successors or assigns.

 

18.                                 **COUNTERPARTS****.**                                       This Agreementmay be executed in any number of counterparts, each of which shall be deemed tobe an original and all such counterparts taken together shall be deemed toconstitute one and the same instrument.

 

19.                                 **SELLER’SOBLIGATIONS****.**

 

(a)                                  DocumentaryStamps.                           Seller shall beresponsible to pay any documentary stamps and/or transfer taxes incurred orrequired in connection with the sale of Property as contemplated herein.

 

(b)                                 Non-ResidentWithholding Tax. If the Seller is not a resident of the State ofRhode Island or will not be a resident at the time of the Closing, thePurchaser must withhold six percent (6%) of the total payment to the Seller(nine percent (9%) if the Seller is a corporation), in accordance with R.I.G.L.Section 44-30-71.3, as same may be amended from time to time, and pay suchamount to the Division of Taxation as a non-resident withholding tax.  In order to have such tax based on gainrather than net proceeds of sale, Seller must submit an election form to theDivision of Taxation at least twenty (20) days prior to closing.  Seller agrees to pay the entire amount ofsuch tax found to be due at or after the closing, whether or not such tax wascorrectly calculated at the closing. This shall survive the transfer of title to the Property.

 

(c)                                  ForeignInvestment in Real Property Tax Act (“FIRPTA”). The Seller represents thatthe Seller is not a foreign person or foreign corporation as defined in FIRPTAand, accordingly, that the Purchaser will not be required to comply with thewithholding requirements of FIRPTA at the closing.

 

(d)                                 Survey CostReimbursement.  At ClosingSeller shall reimburse Purchaser for the cost to prepare an ALTA survey of theProperty.

 

----

 

20.                                 **PURCHASER****INFORMATION****.**

 

(a)**                                 **Ordinances. Purchasers ofReal Estate in the State of Rhode Island are legally obligated to comply withall local real estate ordinances, including but not limited to ordinances onthe number of unrelated persons who may legally reside in a dwelling, as well,as ordinances on the number of dwelling units permitted under the local zoningordinances.

 

(b)**                                **Radon Gas. RADON HASBEEN DETERMINED TO EXIST IN THE STATE OF RHODE ISLAND. TESTING FOR THE PRESENCEOF RADON IN RESIDENTIAL REAL ESTATE PRIOR TO PURCHASE IS ADVISABLE.

 

(c)**                                 **LeadContamination. Every Purchaser of residential real estate builtprior to 1978 is hereby notified that such properties may have lead exposuresthat may place young children at risk of developing lead poisoning. Leadpoisoning in young children may produce permanent neurological damage,including learning disabilities, reduced I.Q., behavioral problems, andimpaired memory. The Seller of such property is required to provide thePurchaser with a copy of any lead inspection report in the Seller’s possessionand notify the Purchaser of any known lead poisoning problem. Environmentallead inspection is recommended prior to purchase.

 

(d)**                                **Restrictions orLegislative/Governmental Action. Purchaser is responsiblefor investigating whether there are any restrictions orlegislative/governmental actions, present or proposed, which affect or wouldaffect the use of the Property and Purchaser acknowledges that it has notrelied on any advise or representations by Seller, Listing Agent or any otherreal estate representatives in this transaction with regard to same.

 

(e)                                  Water System.  Private water supply (well).  Purchaser understands that this property, isor may be served by a private water supply (well) which may be susceptible tocontamination and potentially harmful to health.  If a public water supply is not available,the private water supply should be tested for coliforms, nitrates, andchlorides.  Periodic testing isrecommended.

 

(f)                                    Wetlands. The locationof coastal wetlands, bay fresh water wetlands, ponds, marshes, river banks orswamps, and the associated buffer areas may impact future propertydevelopment.  Seller must disclose to thePurchaser any such determinations on all or part of the land made by theappropriate governing body.  Purchaser isadvised to seek professional assistance in investigating these potentiallocations.

 

21.                                 **RELATIONSHIP****.**                                                Nothingcontained in this Agreement shall be deemed or construed by the parties or byany third person to create a relationship of principal and agent or apartnership or a joint venture between Purchaser and Seller or between eitheror both of them and any third party.

 

22.                                 **SEVERABILITY****.**   Nothing contained hereinshall be construed so as to require the commission of any act contrary to law,and whenever there is any conflict between any provision herein and any presentor future statute, law, ordinance or regulation contrary to which the partieshave no legal right to contract, the latter shall prevail, but the provision ofthis 

 

----

 

Agreement affected shall be limited only to the extent necessary tobring it within the requirements of such statute, law, ordinance or regulation.

 

23.                                 **CHOICEOF LAW****.**                                        This Agreement, and theinterpretation and enforcement thereof, shall be governed by the laws of theState where the Property is located.

 

24.                                 **CAPTIONS,NUMBER AND GENDER****.**                              The captions appearing atthe commencement of the sections and subsections hereof are descriptive onlyand for convenience in reference.  Shouldthere be any conflict between such caption and the section or subsection at thehead of which it appears, the section or subsection and not such caption shallcontrol and govern the construction of this Agreement.  Unless the context otherwise requires,singular nouns and pronouns used in this Agreement are to be construed asincluding the plural thereof.  Forconvenience and brevity, masculine pronouns are used herein in their genericsense as a reference to all persons, without regard to sex.

 

25.                                 **MERGER****.**                                         The acceptanceof the Deed by Purchaser shall be deemed to be a full performance and dischargeof every agreement and obligation of Seller herein contained and expressed,except such as are, by the terms hereof, to survive, or to be performed after,the delivery of said Deed.

 

26.                                 **FURTHERASSURANCES****.**                                             Seller agreesthat it will, at any time and from time to time after the Closing Date, uponrequest of Purchaser, do, execute, acknowledge and deliver, or will cause to bedone, executed, acknowledged or delivered, all such further acts, deeds,assignments, conveyances, and assurances as may reasonably be required for thebetter conveying, transferring, assigning, assuring and confirming the Propertyto Purchaser.  The provisions of this Section 26shall survive the delivery of the Deed and the consummation of the transactionscontemplated by this Agreement

 

**IN WITNESS WHEREOF**, the Seller and Purchaserhave caused this Agreement to be executed under seal as of the date first abovewritten.

 

 
| **PURCHASER:**        | **SELLER:**               |   |
|-----------------------|---------------------------|--------|
|                  |                      |   |
| Faith  Realty II, LLC | Summer Infant (USA), Inc. |   |

 

 
| By:    | /s/  Jason Macari     |    | By:   | /s/  Joseph Driscoll |
|--------|-----------------------|---------|-------|----------------------|
|   | Jason  Macari, Member |    |
|   |                  |
| Date:  | 3/24/09               |    | Name: | Joseph  Driscoll     |
|   | Title:                | CFO     |
|   | Date:                 | 3/24/09 |
|        |                       |         |       |                      |  |  |  |

 

----

 

**EXHIBIT “A”**

 

Legal Description

 

That certain tract or parcel of land, withall buildings and improvements thereon, situated on the easterly and southerlyside of Park East Drive (extension), in the City of Woonsocket, County ofProvidence, State of Rhode Island, bounded and described as follows:

 

Beginning at a Rhode Island highway boundoil the southerly sideline of said Park East Drive (Extension), said pointbeing twenty-eight and 00/100 (28.00) feet left and opposite Station 85+ 16.66on State Highway Plat #2386;

 

Thence S35° 42’ 33” W a distance- of onehundred forty and 00/100 (140.00) feet to an angle point;

 

Thence S51° 51’ 53” W a distance of onehundred ninety-six and 44/100 (196.44) feet to an angle

 

Thence S40° 21’ 03” W a distance of onehundred thirty-three and 48/100 (133.48) feet to an angle point;

 

Thence S36° 12’ 39” W a distance offorty-nine and 34/100 (49.34) feet to a corner;

 

Thence N54° 17’ 27” W a distance of twohundred thirty-two and 38/100 (232.38) feet to an angle point;

 

Thence S86° 27’ 52” W a distance of onehundred seventy and 92/100 (170.92) feet to the easterly line of Park FastDrive;

 

Thence northerly bearing easterly alongthe arc of a curve having a radius of three-hundred twenty-two and 00/100(322.00) feet, an arc length of three hundred eighty-nine and 13/100 389.13)feet, a chord bearing of N50° 49’ 35”E and a chord distance of three hundredsixty-five Byrd 88/100 (365.88) feet to a Rhode Island highway boundtwenty-eight (28.00) feet left and opposite station 89+51.85;

 

Thence N85° 26’ 47”E continuing along thesoutherly sideline of Park East Drive, a distance of three hundred three, and32/100 (303.32) feet to a Rhode Island highway bound twenty-eight (28.00) feetleft and opposite Station 86+48.53;

 

Thence easterly bearing southerly alongthe arc of a curve having a radius of five hundred seventy-two and 00/100(572.00) feet, an arc length of one hundred twenty-five and 39/100 (125.39)feet, a chord bearing of S88° 16’ 25”E and a chord distance of one hundredtwenty-five and 14/100 (125-14) feet to the point and place of beginning.

 

Said parcel is further designated as MapD7, D8 Lot 59-16 on plan entitled “ADMINISTRATIVE SUBDIVISION PLAN MAP D7, D8LOT 59-16 SITUATED ON: PARK EAST DRIVE (EXTENSION) WOONSOCKET, RHODE ISLANDSCALE: 1” = 40’ DATE: OCTOBER 2004 REVISED:  NOVEMBER, 2004 REVISED:JANUARY, 2005, FEBRUARY, 2005 PREPARED FOR: FAITH REALTY, LLC. 6 BLACKSTONEVALLEY PLACE SUITE 206A, LINCOLN, R.I. 02865  PREPARED BY: CROSSMAN ENGINEERING, INC. 151 Centerville Road Warwick,Rhode ISLAND 02886 (the “Subdivision Plan”), which Subdivision Plan, isrecorded at Plan Book 22, Page 59 of Woonsocket Land Evidence Records.

 

----

 

EXHIBIT B

 

Existing Encumbrances

 

Restrictions at Book 1083, Page 577.

 

Notice of taking to State of Rhode Island at Book 962, Page 101,regarding taking at Book 961, Pages 336 and shown on RIDOT Highway Plan 2386and recorded at Plan Book 21, Pages 1-30.

 

Blackstone Valley Electric and Tennessee Gas easements at Plan Book 20,Page 8.

 

Conditions described on Plan Book 21, Page 39.

 

Rights of others in and to brooks or streams crossing through or onlocus.

 

Deed of easements to Redevelopment Agency of Woonsocket recorded atBook 1417, Page 192.

 

Subdivision Plan recorded at Plan Book 22, Page 59.

 

RIDEM Insignificant Alteration Permit recorded at Book 1474, Page 58,revised June 1, 2006 at Book 1547, Page 165.

 

Zoning Decision recorded at Book 1473, Page 198.

 

Easement to NarragansettElectric recorded at Book 1609, Page 319.

 

----

 

EXHIBIT C

 

Deed

 

----

 

**WARRANTYDEED**

 

**SUMMERINFANT (USA), INC.,** a Rhode Island corporation (“**Grantor**”)with a mailing address of 1275 Park East Drive, Woonsocket, Rhode Island 02895

 

*forFour Million Fifty-Two Thousand Five Hundred and 00/100 Dollars ($4,052,500.00)paid, grants to*

 

**FAITHREALTY II, LLC,** a Rhode Island limited liability company with amailing address of 10 Hannah Drive, Cumberland, Rhode Island 02864

**WITH WARRANTY COVENANTS**

 

Thatcertain tract or parcel of land, together with the buildings and improvementsthereon, situated in Woonsocket, Rhode Island, and more fully described on Exhibit Aattached hereto and by this reference incorporated herein.

 

Beingthe same premises conveyed to Summer Infant (USA), Inc. (successor bymerger with Summer Infant, Inc.) by deed dated March 1, 2007 andrecorded in Book 1637 at Page 162 in the Land Evidence Records of the Cityof Woonsocket, Rhode Island on March 6, 2007.

 

Subjectto restrictions, easements, covenants and all other matters of record.

 

Subjectto taxes assessed December 31, 2008, not yet due and payable.

 

Thetransfer is such that no withholding is required under Section 44-30-71.3of the Rhode Island General Laws of 1956, as amended, as Grantor is a RhodeIsland corporation as evidenced by affidavit.

 

**[Remainder of Page Left Intentionally Blank]**

 

----

 

WITNESSMY HAND THIS      DAY OF MARCH, 2009.

 

 
|   | Summer  Infant (USA), Inc |
|--------|---------------------------|
|   |                      |
|   | By:                       |   |
|   | Name:                     |
|   | Title:                    |

 

 

STATE OF RHODE ISLAND

 

Providence,ss.                                                                                                                                                                                                                                                               March     ,2009

 

 

Thenpersonally appeared the above-named                           the                           of Summer Infant (USA), Inc., known to me to be the person described inand who executed the foregoing instrument in such capacity and acknowledged thesame to be his free act and deed and the free act and deed of Summer Infant(USA), Inc.

 
|   |                    |
|--------|-------------------------|
|   | Notary  Public          |
|   | My  commission expires: |

 

 

PropertyAddress:

 

1275Park East Drive

Woonsocket,Rhode Island 02895

Plat59 Lot 16

 

----

 

**EXHIBIT A**

 

**Legal Description**

 

That certain tract or parcel of land, withall buildings and improvements thereon, situated on the easterly and southerlyside of Park East Drive (extension), in the City of Woonsocket, County ofProvidence, State of Rhode Island, bounded and described as follows:

 

Beginning at a Rhode Island highway boundoil the southerly sideline of said Park East Drive (Extension), said pointbeing twenty-eight and 00/100 (28.00) feet left and opposite Station 85+ 16.66on State Highway Plat #2386;

 

Thence S35° 42’ 33” W a distance- of onehundred forty and 00/100 (140.00) feet to an angle point;

 

Thence S51° 51’ 53” W a distance of onehundred ninety-six and 44/100 (196.44) feet to an angle

 

Thence S40° 21’ 03” W a distance of onehundred thirty-three and 48/100 (133.48) feet to an angle point;

 

Thence S36° 12’ 39” W a distance offorty-nine and 34/100 (49.34) feet to a corner;

 

Thence N54° 17’ 27” W a distance of twohundred thirty-two and 38/100 (232.38) feet to an angle point;

 

Thence S86° 27’ 52” W a distance of onehundred seventy and 92/100 (170.92) feet to the easterly line of Park FastDrive;

 

Thence northerly bearing easterly alongthe arc of a curve having a radius of three-hundred twenty-two and 00/100(322.00) feet, an arc length of three hundred eighty-nine and 13/100 389.13)feet, a chord bearing of N50° 49’ 35”E and a chord distance of three hundredsixty-five Byrd 88/100 (365.88) feet to a Rhode Island highway boundtwenty-eight (28.00) feet left and opposite station 89+51.85;

 

Thence N85° 26’ 47”E continuing along thesoutherly sideline of Park East Drive, a distance of three hundred three, and32/100 (303.32) feet to a Rhode Island highway bound twenty-eight (28.00) feetleft and opposite Station 86+48.53;

 

Thence easterly bearing southerly alongthe arc of a curve having a radius of five hundred seventy-two and 00/100(572.00) feet, an arc length of one hundred twenty-five and 39/100 (125.39)feet, a chord bearing of S88° 16’ 25”E and a chord distance of one hundredtwenty-five and 14/100 (125-14) feet to the point and place of beginning.

 

Said parcel is further designated as MapD7, D8 Lot 59-16 on plan entitled “ADMINISTRATIVE SUBDIVISION PLAN MAP D7, D8LOT 59-16 SITUATED ON: PARK EAST DRIVE (EXTENSION) WOONSOCKET, RHODE ISLANDSCALE: 1” = 40’ DATE: OCTOBER 2004 REVISED:  NOVEMBER, 2004 REVISED:JANUARY, 2005, FEBRUARY, 2005 PREPARED FOR: FAITH REALTY, LLC. 6 BLACKSTONEVALLEY PLACE SUITE 206A, LINCOLN, R.I. 02865  PREPARED BY: CROSSMAN ENGINEERING, INC. 151 Centerville Road Warwick,Rhode ISLAND 02886 (the “Subdivision Plan”), which Subdivision Plan, isrecorded at Plan Book 22, Page 59 of Woonsocket Land Evidence Records.

 

18

----

 

EXHIBIT D

 

Lease

 

----

 

**LEASE**

 

 

**OF PREMISES AT 1275 PARK EAST DRIVE**

 

 

**WOONSOCKET, RHODE ISLAND**

 

 

**FROM**

 

 

**FAITH REALTY II, LLC,**

**A RHODE ISLAND LIMITED LIABILITY COMPANY**

 

 

**TO**

 

 

**SUMMER INFANT (USA), INC.,**

**A RHODE ISLAND CORPORATION**

 

ii

----

 

**SUMMARY OF BASIC TERMS**

 

###### **LEASE**

 

**OF PREMISES AT 1275 PARK EASTDRIVE,**

**WOONSOCKET, RHODE ISLAND**

 

**TO**

 

 

**SUMMER INFANT (USA), INC.,**

**A RHODE ISLAND CORPORATION**

 

 

**DATED AS OF MARCH 24, 2009**

 

The following is a summary of certain basic terms of this Lease whichis intended for the convenience and reference of the parties.  Capitalized terms used, but not defined, inthis Summary of Basic Terms, have their defined meanings in this Lease.  In addition, some of the following items orterms are incorporated into this Lease by reference to the item or term or tothis Summary of Basic Terms.

 

1.                                       Landlord:  Faith Realty II, LLC, a Rhode Island limitedliability company.

 

2.                                       Tenant:  Summer Infant (USA), Inc., a RhodeIsland corporation.

 

3A.                             Premises:  All of the leasable space in the Building.

 

3B.                               Landlord’s Property:  The Land with the Building and any otherimprovements now or hereafter thereon, commonly known as 1275 Park East Drive,Woonsocket, Rhode Island, as described on Exhibit A.

 

3C.                               Leasable SquareFootage of the Premises: approximately 52,000 square feet.

 

4.                                       TenantImprovements Work:  Tenantshall perform the Tenant Improvements Work as provided in Section 3.1.

 

5A.                             Lease Term:  From the Commencement Date (March 24,2009) until the last day of the seventh Lease Year March 31, 2016),subject to extension in accordance with Section 2.4(b).

 

5B.                               Commencement Date:  March 24, 2009.

 

5C.                               Rent Commencement Date:  April 1, 2009.

 

----

 

5D.                              Right of Extension:  Tenant shall have the right to extend theLease Term for one term of five years in accordance with Section 2.4(b).

 

6.                                       Permitted Use:  Subject to applicable Legal Requirements, thePremises may be used only for manufacturing, warehouse and general officepurposes and other lawful purposes ancillary thereto.

 

7.                                       SecurityDeposit:  $32,000.00, in the form ofcash.

 

8.                                       Tenant’sParking Allocation:  All of theparking spaces in the Parking Area, subject to Landlord’s right to use parkingspaces in the Parking Areas in connection with the management and operation ofLandlord’s Property.

 

9.                                       Base Rent:  Base Rent for the Initial Term shall be asfollows:

 
| **PERIOD**                                                                                                                                            | ** ** | **ANNUAL  RATE** | ** ** | **MONTHLY  RATE** | ** ** | **PSF  RATE** | ** ** |
|-------------------------------------------------------------------------------------------------------------------------------------------------------|------------|------------------|------------|-------------------|------------|---------------|------------|
|                                                                                                                                                  |       |             |       |              |       |          |       |
| Rent Commencement Date through seventh Lease Year  (April 1, 2009 – March 31, 2016)                                                    |       | $                | 390,000.00 |              | $          | 32,500.00     |       | $ | 7.50 |   |
|                                                                                                                                                  |       |             |       |              |       |          |       |
| First two (2) Lease Years of the Extension  Term (if Tenant elects to exercise such extension) (April 1, 2016 –  March 31, 2018)  |       | $                | 429,000.00 |              | $          | 35,750.00     |       | $ | 8.25 |   |
|                                                                                                                                                  |       |             |       |              |       |          |       |
| Last three (3) Lease Years of the Extension  Term (if Tenant elects to exercise such extension) (April 1, 2018 –  March 31, 2021) |       | $                | 468,000.00 |              | $          | 39,000.00     |       | $ | 9.00 |   |

 

10.                                 Tenant’s Electricity Costs:  Tenant shall directly pay its actual costsfor electricity services provided to the Premises for lights and plugs (“Tenant’sElectricity Costs”), as provided in Section 4.6.

 

11.                                 Heat and Utilities: To beobtained by Tenant at Tenant’s sole cost and expense (including water and sewercharges).

 

12.                                 First Payment:  First month’s Base Rent in the amount of$32,500.00, plus the Security Deposit, shall be paid upon execution of thisLease.

 

13.                                 Broker:  None.

 

iv

----

 

14A.                       Tenant’sAddress for Notices, Telephone Number, Fax Number and Taxpayer IdentificationNo.:

 

SummerInfant (USA), Inc.

1275Park East Drive

Woonsocket,Rhode Island

Attn:Joseph Driscoll, CFO

Telephone: (401) 671-6922;  Fax:(401) 671-6051

 

Withcopies to:

 

GreenbergTraurig, LLP

One International Place – 20th Floor

Boston, MA 02110

Attn: John M. Bello, Esq.

Telephone:(617) 310-6285; Fax: (617) 897-0985

 

Tenant F.I.D.# 20-8641043

 

14B.                         Landlord’sAddress for Notices:

 

Faith Realty II, LLC

10 Hannah Drive

Cumberland, Rhode Island 02864

Attn: Jason Macari

Telephone:(401) 671-6563;  Fax:  (401) 671-6563

 

with a copy to:

 

Poore & Rosenbaum LLP

30 Exchange Terrace

Providence, RI 20903

Attn: Steven Rosenbaum, Esquire

Telephone: (401) 831-2600; Fax: (401) 831-2220

 

v

----

 

**LEASE**

 

THISLEASE (this “Lease”), made as of the 1st day ofFebruary, 2009, between Faith Realty II, LLC, a Rhode Island limited liabilitycompany and Summer Infant (USA), Inc., a Rhode Island corporation, is asfollows:

 

**W****ITNESSETH:**

 

**ARTICLE I**

**CERTAIN DEFINITIONS**

 

Inaddition to the words and terms defined elsewhere in this Lease, the followingwords and terms shall have in this Lease the meanings set forth in this Article I(whether or not underscored):

 

“BankruptcyLaws” means any existing or future bankruptcy, insolvency, reorganization,dissolution, liquidation or arrangement or readjustment of debt law or anysimilar existing or future law of any applicable jurisdiction, or any lawsamendatory thereof or supplemental thereto, including, without limitation, theUnited States Bankruptcy Code of 1978, as amended (11 U.S.C. Section 101 *et seq*.), as any or all of the foregoing may be amended orsupplemented from time to time.

 

“BaseRent” has the meaning set forth in Item 9****ofthe Summary of Basic Terms.

 

“Broker”has the meaning set forth in Item 13 of the Summary of Basic Terms.

 

“Building”means the building located on the Land.

 

“BusinessDays” means Monday through Friday, except holidays.  The term “holiday” shall mean (a) thefederal day of celebration of the following holidays:  New Year’s Day, President’s Day, MemorialDay, July 4th, Labor Day,Thanksgiving and Christmas and (b) the Friday after Thanksgiving.

 

“CommencementDate” has the meaning set forth in Item 5B of the Summary of BasicTerms.

 

“EnvironmentalLaw” means the Comprehensive Environmental Response, Compensation, andLiability Act (“CERCLA”), 42 U.S.C. §9601 etseq., theResource Conservation and Recovery Act, 42 U.S.C. §6901 etseq.,the Hazardous Materials Transportation Act, 49 U.S.C. §1802 etseq.,the Toxic Substances Control Act, 15 U.S.C. §2601 etseq., the FederalWater Pollution Control Act, 33 U.S.C. §1251 etseq., the CleanWater Act, 33 U.S.C. §1321 etseq., the Clean Air Act, 42 U.S.C.§7401 etseq., all regulations promulgated thereunder, and anyother federal, state, county, municipal, local or other statute, law, ordinanceor regulation (including any state or local board of health rules, regulation,or code), which may

 

1

----

 

relateto the protection of human health or the environment, all as may be from timeto time amended or modified.

 

“Eventof Default” has the meaning set forth in Section 12.1.

 

“ExtensionTerm” means the period beginning at the end of the Initial Term andextending through the end of the twelfth (12th) Lease Year.

 

“HazardousMaterials” or “Hazardous Substances” means, at any time, (a) any “hazardoussubstance” as defined in §101(14) of CERCLA (42 U.S.C. §9601(14)) orregulations promulgated thereunder; (b) any “solid waste,” “hazardouswaste” or “infectious waste,” as such terms are defined in any EnvironmentalLaw at such time; (c) asbestos, urea-formaldehyde, polychlorinatedbiphenyls (“PCBs”), bio-medical materials or waste, nuclear fuel or material,chemical waste, radioactive material, explosives, known carcinogens, petroleumproducts and by-products and other dangerous, toxic or hazardous pollutants,contaminants, chemicals, materials or substances which may be hazardous tohuman health or the environment and which are listed or identified in, orregulated by, any Environmental Law; and (d) any additional substances ormaterials which are classified or considered to be hazardous or toxic under anyEnvironmental Law.

 

“InitialTerm” means the period beginning on the Commencement Date and extendingthrough the end of the seventh (7th) Lease Year.

 

“InsuranceCosts” includes the cost of insuring Landlord’s Property, including withoutlimitation the Building and all other improvements now or hereafter situatedthereon, and all operations conducted in connection therewith, with such policies,coverages and companies and in such limits as may be reasonably required byLandlord (and/or which may be required by Landlord’s lenders), including, butnot limited to, fire insurance with extended or with all-risk coverage,comprehensive public liability insurance covering personal injury, deaths andproperty damage with a personal injury endorsement covering false arrest,detention or imprisonment, malicious prosecution, libel and slander, andwrongful entry or eviction, rent loss or business interruption insurance, plateglass insurance, contractual liability insurance, boiler insurance and fidelitybonds, all such insurance to be with coverages and in amounts and withdeductibles consistent with insurance maintained by landlords of properties ofcomparable type and character in the Providence, Rhode Island area.

 

“Invitees”means employees, workers, visitors, guests, customers, suppliers, agents,contractors, representatives, licensees and other invitees.

 

“Land”means the land located at 1275 Park East Drive, Woonsocket, Rhode Island moreparticularly described in Exhibit A.

 

“Landlord”has the meaning set forth in Item 1 of the Summary of Basic Terms.

 

“Landlord’sProperty” has the meaning set forth in Item 3B of the Summary ofBasic Terms.

 

2

----

 

“LeaseTerm” means the Initial Term, and, if Tenant timely and properly exercisesits right to extend pursuant to Section 2.4(b), the Extension Term.

 

“LeaseYear” means the 12 month period beginning on the Rent Commencement Date andon each anniversary of the Rent Commencement Date throughout the Lease Term.

 

“LegalRequirements” means all applicable laws, statutes, rules, regulations andrequirements of governmental authorities, including, but not limited to, zoninglaws and building codes.

 

“OperatingCosts” means all costs, expenses and disbursements of every kind and nature(except Taxes and Insurance Costs) necessary or required  in connection with operating, managing,maintaining, repairing or replacing Landlord’s Property or elements thereof, inthe same condition and repair as the Landlord’s Property is at the CommencementDate or may be put in during the Term hereof. Operating Costs shall include, by way of illustration, but not belimited to:  all charges incurred inconnection with the maintenance and repair obligations with respect to Landlord’sProperty including the HVAC, electrical, mechanical and plumbing systems; allcharges incurred  to provide utilityservices to Landlord’s Property; all costs related to removal of snow and ice;all costs of pest and vermin control; all costs of providing, maintaining andrepairing paving, curbs, walkways, landscaping, planters, roofs, walls,drainage, utility lines, security systems and other equipment; all costs ofpainting the exterior of the Building; all costs of repaving, resurfacing, andrestriping the Parking Area and drives; all costs of lighting, cleaning,maintaining and repairing the Outside Areas; all costs of licenses, permits andinspection fees; all legal, accounting, inspection and consulting fees; allcosts of wages, salaries and benefits of operating personnel hired by Tenant,including welfare, retirement, vacations and other compensation and fringebenefits and payroll taxes.  OperatingCosts shall also include any costs for alterations to the Landlord’s Propertyrequired or necessary to comply with changes in laws or Legal Requirements.Operating Costs shall not include (i) replacement of the structuralcomponent parts of the Building, roof, walls and floor unless such replacementis caused by the negligent acts, actions or omissions of the Tenant, itsemployees, agents, representatives or invitees, in which case such replacementcosts shall be borne by the Tenant or (ii) legal, accounting, inspectionand consulting fees incurred by Landlord in administering this Lease; provided;however, Landlord shall be entitled to reimbursement for reasonable legal feesincurred in successfully enforcing the terms of this Lease.

 

“OutsideAreas” means all areas of Landlord’s Property located outside of theBuilding.

 

“ParkingArea” means those portions of Landlord’s Property which may be used forparking as depicted on the Site Plan.

 

“PermittedUse” has the meaning set forth in Item 6****ofthe Summary of Basic Terms.

 

“Person”means any individual, partnership, joint venture, trust, limited liabilitycompany, business trust, joint stock company, unincorporated association,corporation, institution or other entity, including any governmental authority.

 

3

----

 

“Premises”has the meaning set forth in Item 3A of the Summary of Basic Terms.

 

“RentCommencement Date” has the meaning set forth in Item 5C of theSummary of Basic Terms.

 

“RooftopEquipment” means a satellite dish, antenna, related communicationsequipment and supplemental HVAC equipment installed on the roof of the Buildingby or for Tenant for use in Tenant’s business.

 

“SecurityDeposit” has the meaning set forth in Item 7 of the Summary of BasicTerms.

 

“Summaryof Basic Terms” means the Summary of Basic Terms which is affixed to thisLease.

 

“TaxFiscal Year” shall mean July 1 through June 30 next following, orsuch other tax period as may be established by law for the payment of Taxes.

 

“Taxes”shall mean (a) all taxes, assessments, betterments, water or sewerentrance fees and charges including general, special, ordinary andextraordinary, environmental, or any other charges (including charges for theuse of municipal services if billed separately from other taxes), levied,assessed or imposed at any time by any governmental authority upon or againstthe Land, the Building, or the fixtures, signs and other improvements thereonthen comprising Landlord’s Property and (b) all reasonable attorneys’ feesappraisal fees and other fees, charges and costs incurred in connection withany proceedings related to the amount of Taxes, the tax classification and/orthe assessed value of Landlord’s Property. This definition of Taxes is based upon the present system of real estatetaxation in the State of Rhode; if taxes upon rentals or any other basis shallbe substituted, in whole or in part, for the present ad valorem real estatetaxes, the term “Taxes” shall be deemed changed to the extent to which there issuch a substitution for the present ad valorem real estate taxes.

 

“Tenant”has the meaning set forth in Item 2 of the Summary of Basic Terms.

 

“TenantAffiliate” means any Person which controls, is controlled by, or is undercommon control with, Tenant, or is a successor to Tenant (or the acquirer ofthe assets of Tenant) by merger, consolidation or sale of substantially all ofthe assets of Tenant.  For purposes ofthis definition, “control” of a Person means the power, direct or indirect, tovote more than 50% of the securities (or other ownership interests) havingvoting power for the election of directors or managers (in the case of alimited liability company) of the Person.

 

“TenantImprovements Costs” means all costs of designing and performing the TenantImprovements Work, all costs of telephone and data cabling for the Premises.

 

“TenantImprovements Plans” means the plans and specifications for the TenantImprovements Work, to be prepared and adopted as provided in Section 3.1(a),as the same may be modified from time to time pursuant to the terms of thisLease.

 

4

----

 

“TenantImprovements Work” means the work to be performed by Tenant pursuant to theTenant Improvements Plans.

 

“Tenant’sElectricity Costs” has the meaning set forth in Item 10 of theSummary of Basic Terms.

 

**ARTICLE II**

**LEASE OF PREMISES**

 

Section 2.1  Lease of the Premises.  Landlord hereby leases the Premises toTenant, and Tenant hereby leases the Premises from Landlord, on and subject tothe terms and conditions of this Lease, and subject to and with the benefits ofall zoning ordinances and easements, covenants, conditions, restrictions andother matters of record applicable or appurtenant to the Land.  Throughout the Lease Term, Tenant shall havethe exclusive right to use all closed circuit television systems, elevators,lobbies, hallways, corridors, stairwells and mechanical systems, utilities andloading docks serving the Premises and all other ancillary facilities.  This Lease is effective as of the date ofthis Lease, and Tenant may commence occupancy of the Premises on theCommencement Date, however, rental payments due hereunder shall commence on theRent Commencement Date.  From and afterthe Commencement Date, Tenant shall have 24 hour access to the Premises, theOutside Areas and the Parking Areas, subject to the terms of this Lease.

 

Section 2.2  Outside Areas.  The Premises are leased with the benefit ofthe exclusive right to use the Outside Areas for purposes consistent with thePermitted Use and in accordance with Legal Requirements.

 

Section 2.3  Parking.  Without limiting the generality of Section 2.2,Tenant’s Invitees shall have the right to park passenger automobiles in theParking Area.

 

Section 2.4 Lease Term; Extension Option.

 

(a)                                  The Lease Termshall commence at 12:01 a.m. on the Commencement Date and shall end at11:59 p.m. on the last day of the seventh (7th) Lease Year.

 

(b)                                 Provided anEvent of Default does not then exist, Tenant shall have the right to extend theLease Term for one (1) period of five (5) years by giving Landlordwritten notice specifying such extension, which notice must be received byLandlord not earlier than twelve (12) months, nor later than six (6) months,prior to the expiration of the Initial Term. If such extension becomes effective, the Lease Term shall beautomatically extended upon the same terms and conditions as were applicable tothe Initial Term, except that (i) Base Rent for the Extension Term shallbe the amount set forth for the applicable periods set forth in Item 9of the Summary of Basic Terms, and (ii) there shall be no further right toextend or renew the Lease Term beyond the Extension Term.

 

5

----

 

Section 2.5 Security Deposit.

 

(a)                                  Simultaneouslywith the execution and delivery of this Lease, Tenant shall deliver to Landlordthe Security Deposit in cash or immediately available funds.

 

(b)                                 The SecurityDeposit is security for the faithful performance and observance by Tenant ofthe terms and conditions of this Lease and is not an advance payment ofrent.  If an Event of Default occurs, Landlordmay use, apply or retain all or any part of the Security Deposit to the extentrequired for payment of any Base Rent or any other sum as to which Tenant is indefault or for any sum which Landlord may expend or may be required to expendby reason of the occurrence of an Event of Default, including, but not limitedto, any damage or deficiency accrued before or after summary proceedings orother re-entry by Landlord, including the costs of such proceeding or re-entryand further including, without limitation, reasonable attorneys’ fees.  If an Event of Default occurs, Landlord shallhave the right to apply the Security Deposit, or any part thereof, asaforesaid, without additional notice and without prejudice to any other remedyor remedies which Landlord may have, or Landlord may pursue any other suchremedy or remedies in lieu of applying the Security Deposit or any partthereof.  No interest shall be payable onthe Security Deposit and Landlord shall have the right to commingle theSecurity Deposit with other funds of Landlord. If Landlord applies the Security Deposit in whole or in part, Tenantshall immediately upon demand pay to Landlord the amount so applied to restorethe Security Deposit to its original amount. In the event of a sale or other transfer of Landlord’s Property, orleasing of Landlord’s Property subject to Tenant’s tenancy hereunder, Landlordshall transfer the Security Deposit then remaining to the vendee or lessee, inwhich event Landlord shall thereupon be released from all liability for thereturn of such Security Deposit to Tenant; and Tenant shall look solely to thenew landlord for the return of the Security Deposit then remaining.  The holder of any mortgage on Landlord’sProperty shall not be responsible to Tenant for the Security Deposit or itsapplication or return unless the Security Deposit shall actually have beenreceived by such holder.  Tenant shallnot assign or encumber or attempt to assign or encumber the Security Deposit,and Landlord shall not be bound by any such assignment, encumbrance, attemptedassignment or attempted encumbrance.

 

Section 2.6  Intentionally Deleted.

 

Section 2.7  Lease Amendment.  If, pursuant to Sections 8.1 or 11.1or any other provision of this Lease, there results a change in any of the termsor amounts in the Summary of Basic Terms then in effect, Landlord and Tenantwill promptly execute a written amendment of the Summary of Basic Terms,substituting the changed terms and recomputed amounts in lieu of each of theapplicable terms and amounts then in effect which have been changed.  As of the effective date of the amendment ofthe Summary of Basic Terms, the changed terms (and recomputed amounts) will beeffective for all purposes of this Lease, and the amended and restated Summaryof Basic Terms will be a part of, and incorporated into, this Lease.

 

6

----

 

**ARTICLE III**

##### **WORK; SIGNS**

 

Section 3.1  Tenant Improvements Work.  Tenant shall design and perform the TenantImprovements Work, and the Tenant Improvements Costs shall be borne by Tenant.

 

(a)                                  TenantImprovements Plans.  Tenantshall prepare or cause to be prepared, and shall submit to Landlord for reviewand approval the Tenant Improvements Plans. Within ten (10) Business Days after receipt of the TenantImprovements Plans, Landlord shall, by written notice to Tenant, approve ordisapprove the Tenant Improvements Plans, and if Landlord fails to respondwithin such ten (10) Business Day period, Landlord will be deemed to havedisapproved the Tenant Improvements Plans. Landlord will not unreasonably disapprove proposed Tenant ImprovementsPlans, provided, however, it shall not be unreasonable for the Landlord towithhold its consent and/or disapprove plans that may, in the Landlord’sreasonable discretion have a material adverse effect on the value of theLandlord’s Property.  In any disapprovalof Tenant Improvements Plans, Landlord shall specify in reasonable detail therespects in which the Tenant Improvements Plans are not satisfactory to Landlordand the changes which Landlord desires in order that the Tenant ImprovementsPlans will be satisfactory to Landlord. After receiving any such notice of disapproval from Landlord withrespect to the Tenant Improvements Plans, Tenant will revise the TenantImprovements Plans as reasonably requested by Landlord and will resubmit therevised Tenant Improvements Plans to Landlord for review and approval inaccordance with the procedures set forth above. After approval of the Tenant Improvements Plans by Landlord, Tenant maymake changes to the Tenant Improvements Plans only with the prior writtenapproval of Landlord, which approval shall not be unreasonably withheld,conditioned or delayed; provided that if such changes are minor in nature anddo not affect the structural elements or mechanical systems of the Building,Landlord’s approval shall not be required. Upon approval of the Tenant Improvements Plans, a list identifying theapproved Tenant Improvements Plans shall be attached as Exhibit Bto this Lease.  Tenant shall be fullyresponsible for compliance of the Tenant Improvements Plans with all LegalRequirements and for assuring that the Tenant Improvements Plans provide forTenant Improvements Work that will comply with all Legal Requirements and willsatisfy Tenant’s requirements.  Landlord’sapproval of the Tenant Improvements Plans shall not constitute a certification,representation or warranty by Landlord that the Tenant Improvements Plans areadequate, complete or in compliance with Legal Requirements.

 

(b)                                 Performance ofTenant Improvements Work. Tenant shall perform the Tenant Improvements Work diligently andcontinuously, in a good and workmanlike manner, in accordance with the TenantImprovements Plans, and in compliance with all Legal Requirements.  The contractor(s) performing the TenantImprovements Work shall be subject to the prior written approval of Landlord,which approval shall not be unreasonably withheld, conditioned or delayed andif Landlord does not respond within five (5) Business Days of receivingnotice of Tenant’s contractor selection, then such contractor shall be deemedto be approved by Landlord. If the amount of work to be performed exceeds$250,000 Landlord may require that such contractor shall provide a performanceand payment bond covering the work to be performed by such contractor. Landlordmay, at Landlord’s cost, conduct such inspections of the Tenant ImprovementsWork as Landlord, in its sole discretion, determines.  All such

 

7

----

 

inspectionsand reviews are for the sole benefit of Landlord, and Landlord shall have noliability or obligation to Tenant or any other Person with respect to theTenant Improvements Work.

 

Section 3.2  Delivery.  At such time that this Lease becomes bindingon Landlord as provided in Section 13.10, Landlord shall deliverthe Premises to Tenant for the purpose of planning and performing the TenantImprovements Work in the same condition that is in on the date hereof.

 

Section 3.3  Intentionally Deleted.

 

Section 3.4  Intentionally Deleted.

 

Section 3.5  Signs.  Tenant shall have the right, subject to LegalRequirements, to erect signs identifying Tenant on the exterior façade of theBuilding and monument signs identifying Tenant at the entrance to Landlord’sProperty.  Except for the exterior signspermitted pursuant to the above provisions of this Section, Tenant shall noterect any signs which are visible from the exterior of the Building.  Tenant shall not erect signs except incompliance with all Legal Requirements. Tenant shall be solely responsible for confirming that any proposed signis in compliance with all Legal Requirements. All costs of obtaining permits and approvals, creating, installing,illuminating, maintaining, repairing, and/or replacing Tenant’s exterior signsshall be paid by Tenant.  Tenant shallmaintain its exterior signs in good repair and condition.  At the end of the Lease Term or earliertermination of this Lease, Tenant shall promptly remove Tenant’s signs and restoreall damage related to the installation, existence and/or removal of such signs.

 

**ARTICLE IV**

**BASE RENT; TENANT’S COSTS**

 

Section 4.1 Base Rent.

 

(a)                                  Tenant shallpay Base Rent to Landlord for the Initial Term and the Extension Term (if theTenant elects to extend the Lease Term beyond the Initial Term) the amounts setforth in Item 9 of the Summary of Basic Terms.

 

(b)                                 Base Rent foreach Lease Year shall be payable in equal monthly installments and shall bepaid without offset for any reason, in advance, on the first day of eachcalendar month during the Lease Term commencing on the Rent CommencementDate.  If the Rent Commencement Date isnot on the first day of a calendar month, Tenant shall pay, on or before the RentCommencement Date, a proportionate part of the Base Rent for the month in whichthe Rent Commencement Date occurs based upon the annual Base Rent applicable tothe first Lease Year, divided by three hundred sixty (360) and then multipliedby the number of days in such month (including the Rent Commencement Date)included in the Lease Term.  Base Rentshall be paid by an “electronic funds transfer” system arranged by and amongTenant, Tenant’s bank and Landlord, or in such other manner as Landlord shallfrom time to time designate in writing. The parties acknowledge and agree that the obligations owing by Tenantunder this Section 4.1 are rent reserved under this Lease, for allpurposes hereunder, and are rent reserved

 

8

----

 

withinthe meaning of Section 502(b)(6) of the Bankruptcy Code or anysuccessor provision thereto.

 

Section 4.2  Intentionally Deleted.

 

Section 4.3 Taxes.

 

(a)                                  Tenant shallpay all Taxes during the Initial Term and the Extension Term, if any, whichrelate to the period during which the Tenant occupied the Landlord’s Propertyprior to or when the same shall become due and payable and shall provideLandlord with evidence of such payment.

 

(b)                                 If theCommencement Date is not on July 1, or the expiration or termination ofthis Lease is not on June 30, Tenant’s obligation in respect of Taxesshall be prorated.  If the final tax billfor the Tax Fiscal Year in which such expiration or termination of this Leaseoccurs, then within thirty (30) days after the receipt of the tax bill for suchTax Fiscal Year, Landlord and Tenant shall make appropriate adjustments ofestimated payments.

 

(c)                                  Withoutlimiting the generality of the foregoing, Tenant shall pay all rent andpersonal property taxes attributable to its signs or any other personalproperty including but not limited to its trade fixtures, the existing or anyfuture floor coverings, wall treatments and light fixtures in the Premises.

 

Section 4.4  Insurance Costs.  Tenant shall pay to all Insurance Costsduring the Initial Term and the Extension Term, if any, which relate to theperiod during which the Tenant occupied the Landlord’s Property prior to orwhen the same become due and payable and shall provide Landlord with evidenceof such payments.

 

Section 4.5  Operating Costs.  Tenant shall pay all Operating Costs duringthe Initial Term and the Extension Term, if any, which relate to the periodduring which the Tenant occupied the Landlord’s Property.

 

Section 4.6  Payment for Electricity.  Electric service for lights and plugs in thePremises shall be separately metered, and Tenant shall pay Tenant’s ElectricityCosts directly to the utility provider as due and payable.

 

Section 4.7Intentionally Deleted.

 

**ARTICLE V**

**USE OF PREMISES**

 

Section 5.1  Permitted Use.  Tenant shall use and occupy the Premises onlyfor the Permitted Use.

 

Section 5.2  Restrictions on Use.  Tenant shall use the Landlord’s Property in acareful, safe and proper manner, shall not commit or suffer any waste on orabout Landlord’s Property,

 

9

----

 

andshall not make any use of Landlord’s Property which is prohibited by orcontrary to any Legal Requirements, or which would cause a public or privatenuisance.  Tenant shall comply with andobey all Legal Requirements which in any way affect the use of Landlord’sProperty.  Tenant, at its own expense,shall obtain any and all permits, approvals and licenses necessary for use ofthe Premises.  Tenant shall not overloadthe floors or other structural parts of the Building; and shall not commit orsuffer any illegal act or thing on Landlord’s Property.  Tenant shall cause any fire lanes located onLandlord’s Property to be kept free of all parking associated with its businessor occupancy and in compliance with all applicable regulations.

 

Section 5.3 Hazardous Materials.

 

(a)                                  Tenant (i) willnot conduct any activity on the Landlord’s Property that will use or produceany Hazardous Materials, except for such activities that are part of theordinary course of Tenant’s business activities and conducted in accordancewith all Environmental Laws; (ii) will not use the Landlord’s Property inany manner for the storage of any Hazardous Materials except for storage ofsuch materials that are used in the ordinary course of Tenant’s business andproperly stored in a manner and location satisfying all Environmental Laws; (iii) willnot install any underground tanks of any type; and (iv) will not permitany Hazardous Materials to be brought onto the Landlord’s Property, except inthe ordinary course of Tenant’s business and in compliance with allEnvironmental Laws.  If any HazardousMaterials are brought or found on the Landlord’s Property in violation ofEnvironmental Laws and/or in violation of the above provisions of this Section,the same shall be immediately removed by Tenant, with proper disposal, and allrequired cleanup procedures shall be diligently undertaken pursuant to allEnvironmental Laws.  If at any timeduring or after the Lease Term, the Landlord’s Property is found to be so contaminatedor subject to such conditions  then theTenant shall defend, indemnify and hold Landlord harmless from all claims,demands, actions, liabilities, costs, expenses, damages and obligations of anynature arising from or as a result of the use of the Landlord’s Property  by Tenant or Tenant Invitees under Tenant’sdirection, whether such use occurred prior to the sale by the Tenant to theLandlord of the Landlord’s Property or during the Term of this Lease.  Tenant will maintain on the Premises a listof all materials stored at the Premises for which a material safety data sheet(an “MSDS”) was issued by the producers or manufacturers thereof,together with copies of the MSDS’s for such materials, and shall deliver suchlist and MSDS copies to Landlord upon Landlord’s request therefor.  Except for Hazardous Materials that existedin or on the Premises prior to Tenant’s occupancy thereof, Tenant shall removeall Hazardous Materials from the Premises in a manner acceptable to Landlordbefore the earlier of the date Tenant vacates the Premises and the date Tenant’sright to possess the Premises ends. Landlord may enter the Premises and conduct environmental inspectionsand tests therein as it may require from time to time, provided that Landlordshall use reasonable efforts to minimize the interference with Tenant’sbusiness.  Such inspections and testsshall be conducted at Landlord’s expense, unless they reveal the presence ofHazardous Materials in violation of the above provisions of this Section orthat Tenant has not complied with the requirements of this Section, in whichcase Tenant shall reimburse Landlord for the cost thereof within ten days afterLandlord’s request therefor.

 

Section 5.4  Rooftop Equipment.  At no additional rent to Tenant, butotherwise at Tenant’s cost, Tenant shall have the right to install and maintainRooftop Equipment on the roof

 

10

----

 

ofthe Building for Tenant’s use in connection with Tenant’s business (providedthat Tenant shall not be permitted to make any alterations or installationswhich, in Landlord’s reasonable judgment, could invalidate or otherwiseadversely affect any roof warranty or materially affect the integrity of theroof structure), subject to (a) Legal Requirements, (b) the terms andconditions of this Lease (including, but not limited to, Section 5.2and Article VII), and (c) Landlord’s written approval (whichapproval shall not be unreasonably conditioned, withheld or delayed) of thesize and location of such Rooftop Equipment, together with the plans andspecifications therefor, if Landlord does not respond to such request forapproval within five (5) Business Days of receiving the same then Landlordshall have been deemed to disapprove such matter.  Tenant may use the Building’s risers,conduits and towers for the purpose of installing cabling from the RooftopEquipment to the interior of the Premises, subject to reasonable spacelimitations and to Landlord’s reasonable requirements for the use of such areas.  Tenant shall have access to the roof of theBuilding for the purpose of installing, using, maintaining, repairing andreplacing Rooftop Equipment, subject to Landlord’s reasonablerequirements.  Tenant shall not allow anythird parties to use any Rooftop Equipment installed by Tenant. Tenant shall beresponsible to repair any damage caused to the roof system by the installation,use and/or removal of such Rooftop Equipment.

 

Section 5.5  Generator.  Tenant shall have the right to use theexisting generator serving the Building for its intended purposes and, atTenant’s option and cost, to replace the existing generator with anothergenerator.  If Tenant installs areplacement generator, the replacement generator shall be the property ofLandlord.

 

**ARTICLE VI**

**LANDLORD’S OBLIGATIONS**

 

Section 6.1  Landlord’s Obligations.  Landlord shall keep in good condition andrepair the structural elements of the Building, including the roof, the wallsand the subfloors of the Building. Notwithstanding the foregoing, the Tenantshall be obligated to repair and/or replace any damage to the structuralcomponents of the Building caused by the acts, actions and/or omissions of theTenant, its employees, agents, representatives and Invitees.

 

Section 6.2  Extraordinary Use.  Except for Landlord’s Obligations set forthin Section 6.1, Landlord shall have no obligation to make theLandlord’s Property suitable for Tenant’s use and tenant accepts the Landlord’sProperty in an “AS IS” condition.  Anyadditional capacity or structural support which may be necessary and/orappropriate in connection with the conduct of Tenant’s business and/or Tenant’suse of the Premises shall be installed and maintained at the sole cost andexpense of Tenant subject to, and in accordance with, the applicable provisionsof this Lease.

 

Section 6.3  Interruption; Delay.  Landlord shall have no responsibility orliability for failure or interruption of any such repairs or services referredto in this Article VI, or for any interruption in utility services,caused by breakage, accident, strikes, repairs, inability after exercise ofreasonable diligence to obtain supplies or otherwise furnish services, or forany cause or causes beyond the reasonable control of Landlord (but Landlord, inrespect of those matters for which Landlord is responsible, will use reasonableefforts to restore such services or make such repairs as soon as possible); andfailure or omission on the part of Landlord to furnish such

 

11

----

 

serviceor make such repair shall not be construed as an eviction of Tenant, nor renderLandlord liable in damages, nor entitle Tenant to an abatement of Base Rent,nor release Tenant from the obligation to fulfill any of its covenants underthis Lease, except as provided in Articles X and XI with respect toeminent domain and damage by fire or other casualty.  Notwithstanding anything to the contrarycontained in this Lease, to the extent that any interruption, deprivation orreduction in utility or building services to the Premises is caused by Landlord’sor its agents’, employees’ or contractors’ negligence or willful misconduct,Landlord’s responsibility and Tenant’s remedy shall be limited to an abatementin Base Rent for the period beginning with the day which is three (3) consecutiveBusiness Days after the date on which Tenant delivers notice to Landlord ofsuch interruption, deprivation or reduction and the extent to which Tenant isbeing deprived of reasonable use of the Premises, and ending on the date suchinterruption, deprivation or reduction which is Landlord’s responsibilityceases.

 

Section 6.4Intentionally Deleted.

 

Section 6.5  Indemnification by Landlord.  Landlord shall indemnify, defend, save andhold harmless Tenant from and against all claims, proceedings, defensesthereof, liabilities, costs, and expenses of any kind and nature, includinglegal fees, arising from the negligence or willful misconduct of Landlord, itsagents, contractors or employees, except to the extent the same is caused orcontributed to by the negligence of Tenant or any of Tenant’s Invitees.  This indemnification and hold harmlessagreement shall survive the termination of this Lease.

 

**ARTICLE VII**

**CERTAIN OBLIGATIONS OF TENANT**

 

Section 7.1  Rent.  Tenant will promptly pay the Base Rent at thetime and in the manner provided for in this Lease.

 

Section 7.2  Utilities.  Tenant shall pay Tenant’s Electricity Costsdirectly to the utility provider as provided in Section 4.6.  Except for Tenant’s Electricity Costs, andcharges for telephone, cable and internet service, the charges for publicutility services shall be included in Operating Costs.  Tenant’s use of electricity shall neverexceed the capacity of the feeders, risers and wiring installations in theBuilding.  Without limiting theforegoing, Tenant shall not connect to the electrical distribution systemanything other than normal office equipment. Tenant shall not make or perform any alterations to wiring,installations, lighting fixtures or other electrical facilities in any mannerwithout the prior written consent of Landlord, which consent shall not beunreasonably withheld, if Landlord does not respond to such request for consentwithin five (5) days of receiving the same then Landlord shall have beendeemed to have consented to such matter. Any risers or wiring to meet Tenant’s excess electrical requirements, ifrequested by Tenant and approved by Landlord, will be installed by Landlord atTenant’s expense.

 

Section 7.3  No Waste.  Tenant shall not overload, damage or defacethe Premises nor shall it suffer or permit the same to be done, nor shall itcommit any waste.

 

12

----

 

Section 7.4 Maintenance and Repairs.

 

(a)                                  Tenant will, atits cost and expense, keep the Landlord’s Property neat and clean and maintainthe same in good condition and repair ordinary wear and tear excepted and willmake all replacements and repairs thereto as required pursuant to the terms ofthis Lease.  There is excepted fromTenant’s obligations under this Section 7.4 only (a) damagedue to fire or other casualty, (b) taking by eminent domain and (c) repairsand work which are otherwise the specific responsibility of Landlordhereunder.  At the end of the Lease Termor sooner termination of this Lease, Tenant shall peaceably surrender anddeliver up the Premises to Landlord, broom clean, with all utilities safelycapped, and in good condition and repair, reasonable wear and tear and damageby casualty and taking by eminent domain excepted, and removing all signs andlettering and all trade fixtures, personal property, goods and effectsbelonging to Tenant or anyone claiming through or under Tenant.  Tenant shall cause all maintenance and repairwork to conform to Legal Requirements. Tenant shall keep the Premises clear of all filth, trash and refuse andshall furnish all janitorial services and supplies necessary for thispurpose.  If at any time there exists anEvent of Default as to Tenant’s obligations under the above provisions of this Section 7.4,then Landlord will have the right (but not the obligation), without waiving anysuch Event of Default by Tenant, to cause such obligations to be performed uponnot less than three (3) days’ prior written notice to Tenant (or a shorterperiod of prior written notice, or a contemporaneous written notice, ifappropriate in Landlord’s judgment in light of the nature of Tenant’sobligations to be performed), and if Landlord causes any of such obligations tobe performed, the costs and expenses reasonably incurred by Landlord inconnection therewith shall be due and payable by Tenant to Landlord upondemand.  Notwithstanding any provision ofthis Lease to the contrary, Tenant shall not be required to remove any of theTenant Improvements Work at the end of the Lease Term.

 

(b)                                 Tenant shallkeep any and all Rooftop Equipment neat and clean and maintain any and allRooftop Equipment in good repair and condition. At the end of the Lease Term or sooner termination of this Lease, Tenantshall not be required to remove the Rooftop Equipment.

 

Section 7.5  Alterations by Tenant.  Tenant will not make any change in, oraddition to, the Landlord’s Property without first obtaining, on each occasion,Landlord’s consent in writing, which consent shall not be unreasonablywithheld, conditioned or delayed (if Landlord does not respond to such requestfor consent within five (5) business days of receiving the same thenLandlord shall have been deemed to have not consented to such matter), and then only at Tenant’s expense, and ina lawful manner subject to (a) maintenance of insurance in form andsubstance satisfactory to Landlord and (b) compliance with Sections 7.9and 7.11; provided that Tenant may, upon prior written notice to, butwithout the requirement of consent of, Landlord, make alterations which arepurely cosmetic in nature, such as paint, wallcovering, carpeting and the like,regardless of cost (“Permitted Alterations”).  Any such alteration or addition shall beconsistent with the Permitted Use and shall be made only after duly obtaining(and providing to Landlord copies of) all required permits and licenses fromall governmental authorities.  Tenantwill deliver to Landlord in writing a schedule setting forth the details andlocation of all such proposed alterations or additions and detailed plans andspecifications.  The contractor(s) performingthe work other than Permitted Alterations shall be subject to Landlord’sapproval,

 

13

----

 

whichshall not be unreasonably withheld, conditioned or delayed and if Landlord doesnot respond to such request for consent within five (5) days of receivingthe same then Landlord shall have been deemed to have consented to suchmatter.  All approved repairs,installations, alterations, additions or other improvements made by Tenantshall be made in a good and workmanlike manner and in accordance with LegalRequirements and any plans and specifications approved by the Landlord, ifapplicable.  Tenant agrees not toconstruct or permit the installation of partitions and/or other obstructions inthe Premises which might interfere with Landlord’s free access to the Premisesor Building, or impede the free flow of air to and from air vents and otherportions of the HVAC systems in the Building. Except as herein otherwise provided, all installations, alterations,additions or improvements in or to the Premises shall become the property ofLandlord and shall remain upon, and be surrendered with, the Premises at theend of the Lease Term or sooner termination of this Lease.

 

Section 7.6  Trade Fixtures and Equipment.  Any trade fixtures installed in, or attachedto, the Premises by, and at the expense of, Tenant, and any Rooftop Equipment,shall remain the property of Tenant. Tenant shall have the right, at any time and from time to time duringthe Lease Term, to remove any and all of its trade fixtures, which it may haveinstalled in, or attached to, the Premises, during the Lease Term, and anyRooftop Equipment.  In addition, at theend of the Lease Term or sooner termination of this Lease, Tenant may removesome or all of Tenant’s trade fixtures and Rooftop Equipment.  If at any time that Tenant removes any of itstrade fixtures or Rooftop Equipment, Tenant shall promptly repair Landlord’s Propertyas a result of any damage to, or destruction of, Landlord’s Property caused bysuch removal.

 

Section 7.7  Compliance with Laws.  Tenant, in its use of the Landlord’s Propertyand at its sole expense, shall comply with all Legal Requirements, including,without limitation, all Legal Requirements related to the use, storage,discharge, release, removal or existence of Hazardous Materials.  Tenant agrees that the Landlord’s Propertyshall be kept in a sanitary and safe condition in accordance with all LegalRequirements. And in accordance with the provisions of this Lease.

 

Section 7.8  Contents at Tenant’s Risk.  All inventory, equipment, goods, merchandise,furniture, fixtures and property of every kind which may be on or about thePremises, and all Rooftop Equipment, shall be at the sole risk and hazard ofTenant, and if the whole or any part thereof shall be destroyed or damaged byfire, water or otherwise, or by the use or abuse of water or by the leaking orbursting of water pipes, or by rising water, or by roof or other structuralleak, or by loss of electrical service, or in any other way or manner, no partof such loss or damage shall be charged to or borne by Landlord in any casewhatsoever, except that the foregoing shall not exculpate the Landlord fromliability for its own negligent acts or omissions.  Tenant agrees to maintain full and adequateinsurance coverage on all of its property at the Premises and in the remainderof Landlord’s Property, including physical damage, theft and business interruptioninsurance, or Tenant shall be a self-insurer thereof, in which case Tenantshall so advise Landlord in writing and shall be fully responsible for all suchdamage, and shall indemnify and save harmless Landlord from any loss, cost,expense, damage or liability resulting from Tenant’s failure to have suchinsurance as required in this Lease. Such insurance on Tenant’s property shall contain a waiver ofsubrogation clause in favor of Landlord, or shall name Landlord as anadditional insured for the sole purpose of preventing a subrogation claimagainst Landlord.  If

 

14

----

 

Tenantis a self-insurer, in whole or in part, Landlord shall be entitled to the samebenefits it would have enjoyed had insurance covering the loss in full with awaiver of subrogation clause been in effect, or as if the Landlord has beennamed on insurance covering the loss in full as an additional insured for thepurpose of preventing a subrogation claim.

 

Section 7.9  Exoneration; Indemnification and Insurance.

 

(a)                                  Tenant willexonerate, indemnify, defend, save and hold harmless Landlord (and any and allPersons claiming by, through or under Landlord) from and against allliabilities and claims for personal injury and property damage, and costs andexpenses, including legal fees, in connection therewith arising from anynegligence of Tenant or any of Tenant’s Invitees, or arising from any accident,injury or damage occurring in, on or about Landlord’s Property, which suchaccident, damage or injury results from the acts, actions, omissions,negligence or misconduct on the part of Tenant or any of Tenant’s Invitees;provided that the above provisions of this sentence shall not exculpateLandlord from its own negligence or that of Landlord’s Invitees.  This exoneration, indemnification and holdharmless agreement shall survive the termination of this Lease.

 

(b)                                 During theLease Term and any period of holding over, Tenant shall maintain in full forceand effect a policy of commercial general liability insurance under whichLandlord (and its designees) and Landlord’s mortgagee(s) are named asadditional insureds.  Each such policyshall be non-cancelable with respect to Landlord without thirty (30) days priorwritten notice to Landlord, and Tenant shall deliver to Landlord prior to anypre-term occupancy and thereafter at least thirty (30) days prior to the expirationof any then effective coverage a satisfactory written certificate of insurancecoverages or the renewal or replacement of such coverages.  The minimum limits of liability of suchinsurance shall be $2,000,000.00 combined single limits for bodily injury andproperty damage, each occurrence, and $2,000,000.00 limits for personal injury,together with an overall umbrella coverage of an additional $5,000,000.00,subject to adjustment from time to time during the Lease Term as reasonablyrequired by Landlord consistent with limits for liability insurance customarilymaintained on properties of comparable type and character in the Providence,Rhode Island area.  Any contractorengaged by Tenant to do any work at or furnish any materials to be incorporatedinto the Premises shall deliver to Landlord evidence of the contractor’scommercial general liability insurance, worker’s compensation insurance andautomobile insurance each reasonably acceptable to Landlord, and if requestedby the Landlord for work having an aggregate value in excess of $250,000,payment and performance bonds.

 

(c)                                  Tenant shallmaintain in full force and effect fire, casualty and extended coverageinsurance, with replacement cost coverage, with respect to the improvements tothe Premises constructed by Tenant pursuant to Section 3.1 or Section 7.5.  Tenant shall provide Landlord with acertificate evidencing such insurance and containing a provision that the samemay not be canceled without thirty (30) days’ prior written notice to Landlordand Landlord’s lender, and Tenant shall provide Landlord and Landlord’s lenderwith such a certificate prior to the Commencement Date and thereafter at leastthirty (30) days prior to the expiration of any such coverage. The obligationsof the Tenant set forth herein shall be in addition to the obligations of theTenant to pay the Insurance Costs as set forth in Section 4.4 of thisLease.

 

15

----

 

(d)                                 All insurancerequirements imposed upon Tenant or its contractors under this Lease shall besubject to the requirements that the forms of coverage be reasonably acceptableto Landlord and that the insurers providing the insurance be licensed in theState of Rhode Island, be in sound financial condition, carry an A or betterBest’s rating, and be reasonably acceptable to Landlord.

 

Section 7.10  Landlord’s Access.  Landlord and its representatives shall havethe right without charge to it and without reduction in Base Rent, uponreasonable prior notice, at reasonable times and in such manner as shall notunreasonably interfere with Tenant’s business, to enter the Premises for thepurposes of showing the Premises to prospective purchasers, tenants (during thelast twelve (12) months of the Lease Term) and lenders and investigating repairor maintenance problems and making such repairs or changes as Landlord isrequired or permitted to make hereunder. In case of an emergency, whether resulting from circumstances in thePremises or elsewhere on Landlord’s Property, Landlord or its representativesmay enter the Premises (forcibly, if necessary, provided Landlord shall beresponsible for any damage caused thereby) at any time to take such measures asmay be needed to cope with such emergency.

 

Section 7.11  No Liens.  Tenant shall not permit any mechanics’,laborers’ or materialmen’s liens to stand against Landlord’s Property or Tenant’sinterest in the Premises, this Lease, or the estate created hereby for anylabor or materials furnished to Tenant or claimed to have been furnished toTenant in connection with work of any character performed or claimed to havebeen performed in or on the Premises by or at the direction or sufferance ofTenant.  Landlord may condition the rightof Tenant to do any work which could result in a lien upon Landlord’s Propertyor Tenant’s interests in the Premises, this Lease, or the estate created herebyon the delivery and recording of statutory lien bonds or indemnitiessatisfactory to Landlord.

 

Section 7.12  Tenant Services.  Landlord shall furnish or cause to befurnished to the Building the services set forth below, subject to theconditions stated in this Lease.

 

(a)                                  Water and Sewer.  Cold and hot water at standard Buildingtemperatures will be available for ordinary drinking, cleaning, sanitary andlavatory purposes.

 

(b)                                 Elevators.  Tenant will maintain any elevators in theBuilding.

 

(c)                                  Outside Areas.  Tenant shall maintain and keep the OutsideAreas in good condition and repair. Tenant’s maintenance responsibilities with respect to the Outside Areasshall include landscaping, lighting and snow removal.

 

(d)                                 Taxes.  Tenant shall pay all Taxes levied upon orwith respect to the Landlord’s Property. Tenant shall have the right to file abatements of Taxes in the mannerrequired by applicable law, and shall be entitled to all of the awards onaccount hereof.  Landlord shallreasonably cooperate with Tenant in connection with any such abatement filing,if an to the extent requested by Tenant.

 

16

----

 

(e)                                  Insurance.  Tenant shall procure and maintain in fullforce and effect fire, casualty and extended coverage insurance with respect toLandlord’s Property, with vandalism and malicious mischief endorsements,liability insurance with respect to Landlord’s Property, rent loss insuranceand such other insurance on or with respect to Landlord’s Property as Landlordreasonably determines to be necessary, appropriate and/or desirable or isrequired by Landlord’s lender, all with such limits of coverage as Landlord orLandlord’s lender may deem necessary, appropriate and/or desirable and Tenantshall provide Landlord with a certificate evidencing such insurance andcontaining a provision that the same may not be canceled without thirty (30)days’ prior written notice to Landlord and Landlord’s lender, and Tenant shallprovide Landlord and Landlord’s lender with such a certificate prior to theCommencement Date and thereafter at least thirty (30) days prior to theexpiration of any such coverage. The Tenant shall also comply with and pay theInsurance Costs in accordance with Section 4.4 of this Lease.

 

**ARTICLE VIII**

**SUBLETTING AND ASSIGNMENT**

 

Section 8.1  Subletting and Assignment

 

(a)                                  Except as set forth in Section 8.1(b),Tenant shall not assign, mortgage, pledge or encumber this Lease nor sublet allor any part of the Premises, nor permit or allow the use of all or any part ofthe Premises by third party users, such as concessionaires, without, on eachoccasion, obtaining Landlord’s written consent thereto, which consent shall notbe unreasonably withheld, conditioned or delayed and if Landlord does notrespond to such request for consent within fifteen (15) Business Days ofreceiving the same then Landlord shall have been deemed to have consented tosuch matter.  In connection with aproposed sublease or assignment for which Tenant requests Landlord’s consentpursuant to this Section 8.1(a), Tenant shall furnish to Landlord (i) acopy of the proposed sublease or assignment (or, if the proposed sublease or assignmenthas not yet been negotiated, a summary of the material business terms of thesublease or assignment), (ii) financial and other information about thesubtenant or assignee, and the proposed use of the Premises by the subtenant orassignee, as reasonably requested by Landlord to assess the creditworthiness ofthe subtenant or assignee, to determine whether the subtenant or assignee, andits proposed use, is of a character consistent with the operation of a buildingof the type and character of the Building, and to determine whether theproposed use of the subtenant or assignee is a Permitted Use.  In the event Landlord fails to respond to arequest for consent pursuant to this Section 8.1(a) withinfifteen (15) Business Days after Tenant’s request and the furnishing of theinformation set forth above, Landlord shall be deemed to have consented to theproposed transaction.  Tenant shall payto Landlord all of Landlord’s reasonable expenses arising out of a proposedsublease or assignment, including, without limitation, a legal retainer in areasonable amount required by Landlord in advance of Landlord’s review of anyof Tenant’s documentation in connection therewith.  Tenant may not assign this Lease nor subletall or any part of the Premises at any time that there exists an Event ofDefault.  Any proposed sublease mustprohibit any assignment of the sublease or any sub-sublease of any portion ofthe Premises without the prior written consent of Landlord, which consent maybe granted or denied on terms consistent herewith.

 

17

----

 

(b)                                 (i)                                     Notwithstandinganything to the contrary in Section 8.1(a), but subject to Section 8.1(c),Tenant may, upon at least five (5) Business Days prior written notice to,but without the requirement of consent by, Landlord, sublease all or anyportion of the Premises to one or more Tenant Affiliates, so long as (A) Tenantfurnishes to Landlord a copy of the sublease and evidence reasonablysatisfactory to Landlord that the sublease is permitted under this Section 8.1(b)(i);(B) the subtenant’s proposed use is a Permitted Use; (C) there doesnot then exist an Event of Default; (D) the sublease prohibits anyassignment of the sublease or any sub-sublease of any portion of the Premises withoutthe prior written consent of Landlord, which consent may be granted or deniedon terms consistent herewith; and (E) Tenant pays all of Landlord’sreasonable expenses arising out of such sublease including, without limitation,a legal retainer in a reasonable amount specified by Landlord in advance ofLandlord’s review of any of Tenant’s documentation in connection therewith.

 

(ii)                                  Notwithstandinganything to the contrary in Section 8.1(a), but subject to Section 8.1(c),Tenant may, upon prior written notice to, but without the requirement ofconsent by, Landlord, assign this Lease to a Tenant Affiliate, so long as (A) withinten Business Days after such assignment, Tenant furnishes to Landlord a copy ofthe assignment and evidence reasonably satisfactory to Landlord that theassignment is permitted under this Section 8.1(b)(ii); (B) theassignee’s proposed use is a Permitted Use; (C) there does not then existan Event of Default; and (D) Tenant pays all of Landlord’s reasonableexpenses arising out of such assignment including, without limitation, a legalretainer in a reasonable amount specified by Landlord in advance of Landlord’sreview of any of Tenant’s documentation in connection therewith.

 

(c)                                  In the event ofa permitted assignment of this Lease or sublease of all or any part of thePremises by Tenant, Tenant shall be jointly and severally liable with the newtenant for the payment of any and all Base Rent which may become due by theterms of this Lease and for the performance of all covenants, agreements andconditions on the part of Tenant to be performed hereunder.  Except in connection with an assignment orsublease involving a Tenant Affiliate, Tenant shall pay to Landlord fiftypercent (50%) of any rent received as a result of the assignment or subleasewhich exceeds the Base Rent payable hereunder on a per square foot basis, aftertaking into account the costs of the assignment or sublease (including leasingcommissions, reasonable attorneys’ fees and tenant improvements costs)amortized over the remaining Lease Term. No such assignment or sublease shall be valid or effective unless anduntil (i) the new tenant and the Tenant execute and deliver to Landlord anagreement, in commercially reasonable form submitted by Landlord and with theassignment or sublease attached, pursuant to which interalia,such new tenant (A) in the case of an assignment, assumes all of theobligations of the Tenant under this Lease, (B) agrees to execute anddeliver such estoppel certificates and subordination agreements as may bereasonably required by Landlord, (C) in the case of a sublease,acknowledges that Landlord has no obligations to new tenant under this Lease,the sublease or otherwise and (D) agrees to maintain the same insurancecoverages as the insurance coverages which Tenant is required to maintain underthis Lease and to provide evidence thereof satisfactory to Landlord whenrequested; and (ii) the new tenant delivers to Landlord evidence, in formand substance satisfactory to Landlord, of the insurance coverages required tobe maintained by such new tenant under the agreement referenced in clause (i) above.

 

18

----

 

Nomodification of the terms of this Lease or any course of dealing betweenLandlord and any assignee or sublessee of Tenant’s interest herein shalloperate to release or impair Tenant’s obligations hereunder.

 

(d)                                 IntentionallyOmitted.

 

(e)                                  Tenant shallnot enter into any arrangements with any subtenant or assignee for the purposeof circumventing (i) its obligation to share rents received from asublease or assignment or (ii) any other provisions of this Article VIII.

 

**ARTICLE IX**

**RIGHTS OF MORTGAGEES; ESTOPPEL CERTIFICATES**

 

Section 9.1  Subordination to Mortgages.  Tenant agrees that this Lease is and shall beand remain subordinate to the lien of any present or future mortgage ormortgages upon Landlord’s Property, irrespective of the time of execution ortime of recording of any such mortgage or mortgages, and to all renewals,extensions, and modifications therefor or amendments thereto; provided that asa condition to such subordination, the mortgagee must agree not to disturbTenant’s possession of the Premises pursuant to the terms of this Lease so longas no Event of Default exists.  Tenant shall,upon ten (10) Business Days’ advance written request from Landlord or anyholder of a mortgage on all or a portion of Landlord’s Property, execute anddeliver an agreement to give effect to, or notice of, such subordination,provided that such subordination includes a non-disturbance agreement for thebenefit of Tenant on commercially reasonable terms and conditions specified bythe mortgagee.  Upon ten (10) BusinessDays’ written request from Landlord, any holder of a mortgage on Landlord’sProperty or any successor in interest to Landlord, whether by purchase,foreclosure, deed in lieu of foreclosure or otherwise, Tenant shall enter intoan attornment agreement, in the form reasonably requested by such party, withsuch party.  Without limiting the generalityof the above provisions of this Section 9.1, Tenant and the currentmortgagee of Landlord’s Property shall enter into a Subordination,Non-Disturbance and Attornment Agreement in a form that Tenant, Landlord andLandlord’s mortgagee acting reasonably can collectively agree to.

 

Section 9.2  Intentionally Deleted.

 

Section 9.3  Notice to Mortgagee.  Upon receipt of a written request fromLandlord or any holder of a mortgage, on all or any part of Landlord’sProperty, Tenant will thereafter send any such holder copies of all notices ofdefault or termination given by Tenant to Landlord in accordance with anyprovision of this Lease.  In the event ofany failure by Landlord to perform, fulfill or observe any agreement byLandlord herein or any breach by Landlord of any representation or warranty ofLandlord herein, any such holder may at its election cure such failure orbreach for and on behalf of Landlord within twenty (20) Business Days after thetime provided herein for Landlord to cure the same or such longer period as maybe reasonably necessary to cure the default. In the event of any inconsistency between this Section 9.3and any similar provision in a Subordination, Non-Disturbance and AttornmentAgreement entered into by Tenant and any mortgagee, the provisions of theSubordination, Non-Disturbance and Attornment Agreement shall be controlling.

 

19

----

 

Section 9.4  Limitations on Obligations of Mortgagees andSuccessors. Tenant agrees that the holder of a mortgage or anysuccessor-in-interest to any of them or to Landlord shall not be:  (a) liable for any act or omission ofLandlord under this Lease unless such act or omission is of a continuing natureand the mortgagee(s) or successor in interest to any of them has beengiven notice and a reasonable opportunity to cure such act or omission after ithas taken possession of Landlord’s Property; (b) subject to any offsets ordefenses which Tenant might have against Landlord under this Lease unless the mattergiving rise to such offset or defense is of a continuing nature and themortgagee(s) or successor in interest to any of them has been given noticeand a reasonable opportunity to cure such matter; (c) bound by the paymentof any Base Rent which Tenant might have paid for more that the current monthto Landlord under the Lease; (d) bound by any amendment or modification ofthis Lease made without the prior written consent of the mortgagee or groundlessor and not otherwise permitted under the mortgage or ground lease; (e) personallyliable for any default under this Lease of any covenant or obligation on itspart to be performed, it being acknowledged that Tenant’s sole monetaryrecourse in the event of such default shall be to proceed against the interestof such mortgagee or successor-in-interest in this Lease and Landlord’sProperty; or (f) obligated to perform any of the Tenant ImprovementsWork.  Further, Tenant shall not seek toterminate this Lease by reason of any act or omission of Landlord until Tenantshall have given written notice of such act or omission to the holder of suchmortgage (at such holder’s last address furnished to Tenant) and following thegiving of such notice such holder shall have the right, but shall not beobligated, to remedy such act or omission within twenty (20) Business Daysafter the time period provided for in this Lease for Landlord to cure the sameor such longer period as may be reasonably necessary to cure the same. Tenantshall enter into a written agreement confirming the foregoing from time to timeupon written request from Landlord and/or the holder of a mortgage on Landlord’sProperty.  In the event of anyinconsistency between any Subordination, Non-Disturbance and AttornmentAgreement entered into as contemplated by Section 9.1, and theabove provisions of this Section 9.4, such Subordination,Non-Disturbance and Attornment Agreement shall control.

 

Section 9.5  Estoppel Certificates.  Each party (“Responding Party”) shall,at any time and from time to time, within ten Business Days after writtenrequest by the other party (“Requesting Party”), execute and deliver tothe Requesting Party a statement in writing certifying that (except as may beotherwise specified by the Responding Party): (i) this Lease is presently in full force and effect andunmodified; (ii) Tenant has accepted possession of the Premises; (iii) anyimprovements required by the terms of this Lease to be made by Landlord havebeen completed to the satisfaction of Tenant; (iv) no rent under thisLease has been paid more than 30 days in advance of its due date; (v) theaddresses for notices to be sent to the Responding Party is as set forth inthis Lease or as specified in such certificate; (vi) Tenant has no charge,lien or claim of offset under this Lease, or otherwise, against rents or othercharges due or to become due hereunder; (vii) to the best of the knowledgeof the Responding Party, the Responding Party is not in default under thisLease; and (viii) such other information as the Requesting Party mayreasonably request about this Lease or Tenant’s occupancy.

 

20

----

 

**ARTICLE X**

**CASUALTY**

 

Section 10.1  Damage From Casualty.

 

(a)                                  If any portionof the Building is damaged by fire or other casualty, Tenant shall giveLandlord written notice of such casualty promptly after Tenant becomes aware ofsuch casualty.  Within forty five (45)days after Tenant gives Landlord written notice of such casualty, Landlord shallreasonably estimate, and give Tenant written notice of, the period commencingwith the date of such notice (the “Restoration Period”) that Landlordanticipates will be reasonably required to perform the restoration work whichis the responsibility of Landlord as provided below.  If Landlord reasonably estimates that theRestoration Period will be longer than two hundred seventy (270) days, theneither Landlord or Tenant may terminate this Lease by giving to the otherwritten notice of termination within ten (10) days after Landlord givesTenant written notice of such estimate. Such notice of termination shall be effective on the date thereof, andif Tenant is then occupying the Premises, Tenant shall thereafter have areasonable period of time in which to vacate the Premises.  If (i) Landlord reasonably estimatesthat the Restoration Period will be two hundred seventy (270) days or shorter,or (ii) Landlord reasonably estimates that the Restoration Period will belonger than two hundred seventy (270) days but neither Landlord nor Tenantexercises its right to terminate this Lease as set forth above, then this Leaseshall not terminate; and in such event, Landlord shall, with reasonabledispatch, repair or rebuild the Premises to substantially their condition as ofdelivery of the Premises to Tenant (subject, however, to Legal Requirementsthen in existence), and Tenant shall concurrently (to the extent practical andconsistent with good construction practices) (i) repair and restore somuch of the Premises as was the responsibility of Tenant under this Lease and (ii) repairand restore its fixtures and personal property.

 

(b)                                 If, pursuant toSection 10.1(a), Landlord is required to restore the Premises andLandlord fails to substantially complete such restoration within thirty (30)days after the end of the Restoration Period, subject to extension for delaybeyond the reasonable control of Landlord, then Tenant shall have the right toterminate this Lease upon thirty (30) days prior written notice toLandlord.  If Landlord fails tosubstantially complete such restoration work within such thirty (30) dayperiod, then this Lease shall terminate as of such thirtieth (30th) day.

 

Section 10.2  Abatement of Rent.  In the event that the provisions of Section 10.1shall become applicable, the Base Rent shall be abated or reducedproportionately during any period in which, by reason of any such damage ordestruction, there is substantial interference with the operation of thebusiness of Tenant in the Premises, having regard to the extent to which Tenantmay be required to discontinue its business in the Premises, and such abatementor reduction shall continue (but may be adjusted from time to time based on theextent of the interference with Tenant’s operations) for the period commencingwith such destruction or damage and ending with the substantial completion byLandlord of such work, repair and/or reconstruction as Landlord may do.

 

21

----

 

**ARTICLE XI**

**EMINENT DOMAIN**

 

Section 11.1  Eminent Domain; Right to Terminate andAbatement in Rent.  If thePremises or any part thereof, or such portion of the Parking Areas as wouldcause the remaining Parking Areas to be inadequate for Tenant’s reasonable useand enjoyment of the Premises, shall be taken, or if a conveyance shall be madein anticipation thereof, for any street or other public use, by action of themunicipal, state, federal or other authorities, or shall receive anysubstantial direct or consequential damage for which Landlord or Tenant shallbe entitled to compensation by reason of anything lawfully done in pursuance ofany public authority, after the execution hereof and before the expiration ofthe Lease Term, then this Lease and the Lease Term shall terminate at theelection of either Landlord or Tenant (given by written notice to the otherwithin sixty (60) days of the taking or within ninety (90) days of notice ofthe taking to Landlord), and such election may be made in case of any suchtaking notwithstanding the entire interest of Landlord may have been divestedby such taking; and if neither party so elects, then in case of any such takingor destruction of, or damage to, the Premises, rendering the same or any partthereof unfit for use and occupation, a just proportion of the Base Rentaccording to the nature and extent of the injury sustained by the Premises, asagreed to by Landlord and Tenant, shall be suspended or abated until thePremises or, in case of such taking, what may remain thereof, shall have beenput in proper condition for use and occupation. To the extent that the Premises, upon having been put in propercondition for use and occupation are smaller, the Base Rent hereinbeforereserved shall be reduced for the balance of the Lease Term in the same proportionwhich the reduction in space bears to the original Leasable Square Footage ofthe Premises.

 

Section 11.2  Restoration.  If this Lease is not terminated as providedin Section 11.1, Landlord shall apply so much of the availableproceeds of the eminent domain award as are required to restore Landlord’sProperty and the Premises to a condition, to the extent practical,substantially the same as that immediately preceding the taking, but subject toLegal Requirements then in existence. The term “available proceeds” shall mean the amount of the awardpaid to Landlord, less cost of obtaining the same (including attorneys’ feesand appraisal fees) and less the amount thereof required to be paid to amortgagee.  In the event Landlord failsto commence restoration of the Landlord’s Property and/or the Premises withinsixty (60) days after the taking, Tenant shall have the right to terminate theLease upon sixty (60) days’ prior written notice to Landlord.

 

Section 11.3  Landlord to Control Eminent Domain Action.  Landlord reserves all rights to compensationfor damage to the Premises or any part thereof, or the leasehold herebycreated, heretofore accrued or hereafter to accrue, by reason of any taking forpublic use of said Premises or any portion thereof, or right appurtenantthereto, or privilege or easement in, through, under or over the same, and byway of confirmation of the foregoing Tenant hereby assigns all rights to suchdamages heretofore accrued or hereafter accruing during the Lease Term toLandlord.  However, nothing hereincontained shall limit Tenant’s right to any separate award for the taking ofpersonal property, moving expenses, or other items the payment of which shallnot reduce the award payable to Landlord.

 

22

----

 

**ARTICLE XII**

**DEFAULT AND REMEDIES**

 

Section 12.1  Event of Default.  As used herein, a “Default” shall meanthe occurrence and/or existence of any one or more of the following:  (a) (i) Tenant shall fail to payany installment of Base Rent or the Taxes, Insurance Costs or Operating Costson or before the date on which the same becomes due and payable, and suchfailure continues for fifteen (15) days after Landlord gives Tenant writtennotice thereof; or (b) Tenant shall neglect or fail to perform or observeany of the other covenants or undertakings herein on its part to be performedor observed and such neglect or failure shall continue for thirty (30) daysafter notice to Tenant; provided that if the default is other than a defaultunder clause (a) above, or clauses (c) through (f) below, and issuch that it cannot be cured within thirty (30) days such thirty (30) dayperiod shall be extended for as long as may be reasonably necessary to cure thedefault; or (c) there is filed by Tenant any case, petition, proceeding orother action for protection, reorganization or liquidation under any BankruptcyLaw; or (d) any other proceedings shall be instituted against Tenant underany Bankruptcy Law and not be dismissed within one hundred twenty (120) days;or (e) a receiver, custodian or other similar officer for Tenant shall beappointed and not be discharged within one hundred twenty (120) days; or (f) anassignment or sublease in violation of the terms of this Lease.

 

Section 12.2Landlord’s Remedies.

 

(a)                                  After theexpiration of any cure periods set forth in Section 12.1 above,Landlord shall provide notice thereof to Tenant and Tenant shall have (i) thirty(30) days after such notice to cure any non-payment default and if suchnon-payment default is of a nature that it cannot be cured within thirty (30)days such thirty (30) day period shall be extended for as long as may bereasonably necessary to cure the default provided that Tenant commences suchcure within such thirty (30) day period and diligently pursues the cure thereofor (ii) ten (10) days after such notice to cure any payment defaults;provided; however, that this additional ten (10) day notice and cureperiod for payment defaults shall not be available to Tenant more than two (2) timesin any twelve (12) month period.  Afterthe expiration of such second (2nd) notice and cure period, if applicable (hereafteran “Event of Default”), then at any time thereafter if such Event of Default isin existence then Landlord, in compliance with all Legal Requirements maypursue all legal and equitable remedies to terminate this Lease, repossess thePremises and expel Tenant and those claiming through or under it and removetheir effects without being deemed guilty of any manner of trespass and withoutprejudice to any remedy which might otherwise be used for arrears of Base Rentor breach of covenant, and thereupon this Lease shall terminate and Landlord,in addition to all other remedies which it may have at law or equity, and notin limitation thereof, shall have the remedies provided in this Article XII.  No termination of this Lease and/orrepossession of the Premises pursuant to this Section 12.1 shallrelieve Tenant of its obligations under this Lease, which shall survive suchtermination or repossession.

 

(b)                                 From thetermination of this Lease pursuant to Section 12.2(a) throughthe remainder of the Lease Term, until such time, if any, that Landlordexercises its right pursuant to Section 12.2(c), Tenant shall payto Landlord the Base Rent, Insurance Costs, Taxes and Operating Costs ininstallments as and when the same become due and payable, subject to

 

23

----

 

reductionby any rent actually received by Landlord as a result of a re-letting of thePremises (net of the actual reasonable and customary costs of re-letting,including remodeling costs, brokerage commissions and attorneys’ fees).  Landlord shall exercise commerciallyreasonable efforts to re-let the Premises to mitigate damages, and Landlord mayre-let the Premises or any part or parts thereof, either in the name ofLandlord or otherwise for a term or terms which may, at Landlord’s option, beless than or exceed the period which would otherwise have constituted thebalance of the Lease Term; *provided; that*,Landlord shall be deemed to have expended commercially reasonable efforts tore-let the Premises if it engages a commercial real estate broker withexperience in the market that the Premises is located and such broker lists thePremises at the then current market rents.   Any suit brought to collect the amount of deficiency for any month orother period shall not prejudice in any way the right of Landlord to collectthe deficiency for any subsequent month or period by a similar proceeding.  Landlord, at Landlord’s option, may make suchalterations, repairs, replacements and decorations on the Premises as Landlordin Landlord’s sole but reasonable judgment considers advisable and necessaryfor the purpose of re-letting the Premises, and the making of such alterationsor decorations shall not operate or be construed to release Tenant fromliability hereunder.

 

(c)                                  At Landlord’soption exercisable by written notice given to Tenant upon or after thetermination of this Lease pursuant to Section 12.2(a) and inlieu of an damages provided in Section 12.2(b) above, Tenantshall forthwith pay to Landlord as damages, in addition to all sums which weredue prior to the exercise of such option by Landlord, a sum equal to the amountby which the Base Rent for the remainder of the Lease Term exceeds the fairrental value of the Premises determined as of the termination date for theremainder of the Lease Term, discounted to present value using a then marketrate of interest as reasonably determined by the Landlord.

 

Section 12.3  Reimbursement of Landlord.  After the termination of this Lease pursuantto Section 12.2(a), Tenant will, in addition to paying Landlord allamounts due under the terms and provisions of this Lease, including, withoutlimitation, Section 12.9, reimburse Landlord for all reasonableexpenses incurred by Landlord in collecting such rent or in obtainingpossession of, or in re-letting the Premises, or in defending any action,including expenses for reasonable and actual counsel fees and commissions.  If, on termination of this Lease byexpiration or otherwise, Tenant shall fail to remove any of its property fromthe Premises as provided for herein, Landlord shall be authorized, in its soleoption, and in Tenant’s name and on its behalf, either (a) to cause suchproperty to be removed and placed in storage for the account and at the expenseof Tenant; or (b) to sell such property at public or private sale, with orwithout notice, and to apply the proceeds thereof, after the payment of allexpenses of removal, storage and sale, to the indebtedness, if any, of Tenantto Landlord, the surplus, if any, to be paid to Tenant.

 

Section 12.4  Landlord’s Right to Perform Tenant’sCovenants.  Tenantcovenants and agrees that, if there shall at any time exist an Event of Defaultwith respect to Tenant’s obligation to make any payment or perform any otheract on its part to be made or performed as in this Lease provided, Landlord, inits sole discretion, may make any payment or perform such other act on the partof Tenant to be made or performed as in this Lease provided, in such manner andto such extent as Landlord may reasonably deem desirable, and in exercising anysuch rights, Landlord may pay reasonable, actual and necessary costs andexpenses, employ counsel, and

 

24

----

 

incurand pay reasonable and actual attorneys’ fees. The making of any such payment or the performing of such other act byLandlord pursuant to this Article 12 shall not waive, or releaseTenant from, any obligations of Tenant in this Lease contained.  All sums so paid by Landlord and allreasonably necessary and incidental costs and expenses in connection with theperformance of any such act by Landlord shall, except as otherwise in thisLease expressly provided, be payable to Landlord on demand, and Tenantcovenants to pay any such sum or sums promptly, and Landlord shall have (inaddition to any other right or remedy of Landlord) the same rights and remediesin the event of the non-payment thereof by Tenant as in the case of default byTenant in the payment of the Base Rent.

 

Section 12.5  Cumulative Remedies.  The specified remedies to which Landlord orTenant may resort under the terms of this Lease are cumulative and not intendedto be exclusive of any other remedies or means of redress to which Landlord maybe lawfully entitled in case of any breach or threatened breach by Tenant ofany provisions of this Lease.  Thefailure of Landlord or Tenant to insist in any one or more cases upon thestrict performance of any of the covenants of this Lease or to exercise anyoption contained herein shall not be construed as a waiver or a relinquishmentfor the future of such covenant or option. Receipt by Landlord of any Base Rent payment with knowledge of thebreach of any covenants hereof shall not be deemed a waiver of suchbreach.  No payment by Tenant, whether ornot expressly under protest, shall be deemed a waiver of Tenant’s right todispute its obligation to pay or its right to seek a refund of the same.  No waiver by Landlord or Tenant of anyprovision of this Lease shall be deemed to have been made unless expressed inwriting and signed by it.  In addition tothe other remedies provided in this Lease, Landlord and Tenant shall beentitled to restraint by injunction of any violation or attempted or threatenedviolation of any of the covenants, conditions or provisions of this Lease.  Notwithstanding anything else to the contraryelsewhere in this Lease, Tenant will not be liable for indirect orconsequential damages, other than damages for holding over beyond the end ofthe Lease Term.

 

Section 12.6  Expenses of Enforcement.  Tenant agrees to pay all reasonable andactual out-of-pocket expenses and attorneys’ fees incurred by Landlord inenforcing any obligation or any remedies hereunder including, withoutlimitation, in connection with collection of Base Rent, recovery by Landlord ofthe Premises, or in any litigation in which Landlord shall become involved byreason of any act or negligence of any of Tenant’s Invitees or any breach ofthis Lease by Tenant.

 

Section 12.7  Landlord’s Default.  Landlord shall not be deemed to be in defaulthereunder unless such default shall remain uncured for more than thirty (30)days following written notice from Tenant to Landlord specifying the nature ofsuch default, or such longer period as may be reasonably required to correctsuch default.  In no event whatsoevershall Landlord be liable for consequential or any indirect damages.  Notwithstanding anything to the contrarycontained herein, so long as any Event of Default exists, Tenant shall not beentitled to enforce any obligation from Landlord or seek any cure of Landlord’sdefaults under this Lease.  Theprovisions of this Section 12.7 are further subject to theprovisions of Articles X and XI dealing with eminent domain and fire andother casualty.

 

25

----

 

Section 12.8  Limitation of Liability.  The obligations of Landlord hereunder shallbe binding upon Landlord and each succeeding owner of Landlord’s interesthereunder only during the period of such ownership, and Landlord and eachsucceeding owner shall have no liability whatsoever except for its obligationsduring each such respective period. Tenant hereby agrees for itself and each succeeding holder of Tenant’s interest,or any portion thereof, hereunder, that any judgment, decree or award obtainedagainst Landlord or any succeeding owner of Landlord’s interest, which is inany manner related to this Lease, the Premises or Tenant’s use and occupancy ofthe Premises or the remainder of Landlord’s Property, whether at law or inequity, shall be satisfied out of Landlord’s equity in the land and buildingsthen comprising Landlord’s Property owned by Landlord to the extent then ownedby Landlord and such succeeding owner, or any insurance policies maintained byLandlord, and further agrees to look only to such assets and to no other assetsof Landlord, or such succeeding owner, for satisfaction.  Neither Landlord nor any Person executingthis Lease on behalf of Landlord, nor any partner, limited or general, or anyofficer, director, employee, member, trustee, beneficiary, or owner ofLandlord, nor any subsequent Landlord, or any partner, limited or general, orany officer, director, employee, member, trustee, beneficiary, or owner of anysubsequent Landlord shall have any personal liability hereunder.  No Person executing this Lease on behalf ofTenant, nor any shareholder, director, officer or employee of Tenant, shallhave any personal liability hereunder.

 

Section 12.9  Late Payment and Administrative Expense. If Tenantshall fail to pay Base Rent, Insurance Costs, Operating Costs and Taxes orother charges within fifteen (15) days after the same become due and payableunder this Lease, such unpaid amounts shall bear interest from the due datethereof to the date of payment at an annual rate equal to the prime rateannounced from time to time by Bank of America (or any successor).  In addition, if Landlord is required toredeposit any check which is returned for insufficient funds or if Tenant shallfail to pay Base Rent or other charges within fifteen (15) days after the samebecome due and payable, then Tenant shall also pay to Landlord anadministrative expense charge of five percent (5%) of the amount thereof.  The provisions herein for the payment ofinterest and an administrative expense charge shall not be construed to relieveTenant of the obligation to pay Base Rent and all other charges when due underthis Lease and shall be in addition to and not in limitation of Landlord’sother remedies as provided for in this Lease.

 

**ARTICLE XIII**

**MISCELLANEOUS PROVISIONS**

 

Section 13.1  Brokers.  Tenant and Landlord each represents to theother that it has not dealt with any Person in connection with the Premises orthe negotiation or execution of this Lease other than officers, employees andattorneys of Landlord and Tenant.  Tenantagrees to indemnify, defend (with counsel selected by Landlord) and holdLandlord, and Landlord’s nominees, successors and assigns harmless from any andall claims, costs, commissions, fees or damages by any person or firm claimingto have negotiated, instituted or brought about this Agreement due to contactwith Tenant.  Landlord agrees toindemnify, defend (with counsel selected by Tenant) and hold Tenant, andTenants’s nominees, successors and assigns harmless from any and all claims,costs, commissions, fees or damages by any person or firm claiming to havenegotiated, instituted or brought about this Agreement due to contact withLandlord.

 

26

----

 

Section 13.2  Quiet Enjoyment.  Tenant shall, upon paying all Base Rent duehereunder and observing and performing all of the terms, covenants andconditions on Tenant’s part to be observed and performed, peaceably and quietlyhave and hold the Premises, subject, however, to the terms of this Lease.

 

Section 13.3  Tenant’s Request for Landlord’s Action.  In the event that at Tenant’s written requestLandlord takes any action which is not required of Landlord pursuant to thisLease, Tenant shall pay Landlord’s reasonable and actual attorneys’ fees,expenses and disbursements in connection with such action, with payment to bemade by Tenant within fifteen (15) days after billing therefor by Landlord.

 

Section 13.4  Notices.  Any notice, demand, request or statementrequired or intended to be given or delivered under the terms of this Leaseshall be in writing, shall be addressed to the party to be notified at theaddress or addresses set forth in the Summary of Basic Terms or at such otheraddress in the continental United States as each party may designate for itselffrom time to time by notice hereunder, and shall be deemed to have been given,delivered or served upon the earliest of (a) the next Business Day afterdelivery to a regularly scheduled overnight delivery carrier with delivery feeseither prepaid or an arrangement, satisfactory with such carrier, made for thepayment of such fees or (b) receipt of notice given by telecopy orpersonal delivery.

 

Section 13.5  Waiver of Subrogation.  Landlord and Tenant hereby release each otherfrom any and all liability for any loss or damage caused by fire, any of theextended coverage casualties, or other casualties insured against, or whichwould be covered by insurance either of them is required hereunder to carry,even if such fire or other casualty shall be brought about by the fault ornegligence of the party benefited by the release or its agents, and whether ornot any applicable policy shall contain a clause, or be subject to a statutoryprovision, to the effect that such release shall not affect said policies orthe right of the releasing party to recover thereunder.  Landlord and Tenant agree that their fire,extended coverage, and other insurance policies will include such a clause,whenever available.

 

Section 13.6  Entire Agreement; Execution; Time of theEssence and Headings.  This Leasetogether with all Exhibits referred to herein and the Summary of Basic Terms,sets forth the entire agreement between the parties hereto and cannot bemodified or amended, except in a writing duly executed by the respectiveparties.  This Lease, together with allExhibits referred to herein and the Summary of Basic Terms, supersedes allprevious written and oral negotiations, understandings and agreements regardingthe subject matter of this Lease. Neither Landlord nor Tenant nor any Person acting on behalf of Landlordor Tenant has made any representations to the other on which the other hasrelied in entering into this Lease except any representations expressly statedin this Lease.  This Lease is executed asa sealed instrument and in multiple counterparts, all copies of which areidentical, and any one of which is to be deemed to be complete in itself andmay be introduced in evidence or used for any purpose without the production ofany other copy.  Time is of the essenceof the obligations of Tenant and Landlord to be performed within a specifictime frame in this Lease.  The headingsthroughout this Lease are for convenience of reference only, and shall in noway be held or deemed to define, limit,

 

27

----

 

explain,describe, modify or add to the interpretation, construction or meaning of anyprovision of this Lease.

 

Section 13.7  Partial Invalidity.  If any term or condition of this Lease or itsapplication to any Person or circumstance shall to any extent be in violationof or unenforceable under any law, rule, regulation or order (including anycourt order) now existing or hereafter enacted or entered by any court or othergovernmental entity having competent jurisdiction (including after all appealstherefrom), the remainder of this Lease, or the application of such term orcondition to Persons or circumstances other than those as to which it isinvalid or unenforceable, shall not be affected thereby and shall beenforceable to the fullest extent not prohibited by law.

 

Section 13.8  No Waiver.  No assent, express or implied, by Landlord orTenant to any breach of any agreement or condition herein contained on the partof the other to be performed or observed, and no waiver, express or implied, ofany such agreement or condition shall be deemed to be a waiver of or an assentto any succeeding breach of the same or any other agreement or condition.  The acceptance by Landlord of Base Rent duehereunder (whether such payment is made by Tenant or another Person), orsilence by Landlord as to any breach, shall not be construed as waiving any ofLandlord’s rights hereunder unless such waiver shall be in writing.  No payment by Tenant or acceptance byLandlord of a lesser amount than shall be due Landlord from Tenant shall bedeemed to be anything but payment on account, and the acceptance by Landlord ofa check for a lesser amount with an endorsement or statement thereon, or upon aletter accompanying said check, that said lesser amount is payment in fullshall not be deemed an accord and satisfaction, and Landlord may accept saidcheck without prejudice to recover the balance due or pursue any other remedy.

 

Section 13.9  Holdover.  If Tenant remains in the Premises beyond theexpiration of this Lease at the end of the Lease Term, or sooner following anearly termination as provided for herein, such holding over shall not be deemedto create any tenancy, but Tenant shall be a daily Tenant at sufferance onlysubject to all of Tenant’s obligations set forth herein, but at a daily rateequal to (a) one and one-half times the Base Rent then in effect plus (b) allother charges provided for under this Lease including Operating Costs,Insurance Costs and Taxes.  Theacceptance of a purported rent check following termination shall not constitutethe creation of a tenancy at will, it being agreed that Tenant’s status shallremain that of a daily Tenant at sufferance, at the aforesaid daily rate.  Tenant shall also pay to Landlord all directdamages, if any, sustained by reason of any such holding over, but in no eventshall Tenant be responsible for consequential damages.  Otherwise, such holding over shall be on theterms and conditions set forth in this Lease as far as applicable.

 

Section 13.10  When Lease Becomes Binding.  The submission of this document forexamination and negotiation does not constitute an offer to lease or areservation or an option for the Premises, and this document shall becomeeffective and binding only upon the execution and delivery hereof by bothLandlord and Tenant and the receipt by Landlord of the Security Deposit and thefirst monthly installment of Base Rent. All negotiations, considerations, representations and understandingsbetween Landlord and Tenant are incorporated herein and may be modified oraltered only by agreement in writing between Landlord and Tenant, and no act oromission of any employee or agent of Landlord shall alter, change or modify anyof the provisions hereof.

 

28

----

 

Section13.11  No Recordation. Tenant shallnot record this Lease with any registry of deeds or land court, and any suchrecordation will be void and constitute an Event of Default under thisLease.  Landlord and Tenant shallexecute, and Tenant may record, a notice of this Lease in the form of ExhibitC, provided that at the time of execution of such notice, the parties enterinto arrangements reasonably satisfactory to Landlord to provide for suchnotice to be released when appropriate.

 

Section13.12  As Is.  Tenant represents to Landlord that it hasleased the Premises after a full and complete examination of the same, and byits execution and delivery of this Lease, Tenant hereby acknowledges thatneither Landlord, nor Landlord’s agents, has made any representation orpromises with respect to the Premises, the Building, or the land upon which itstands, and no rights, easements or licenses are acquired by Tenant, byimplication or otherwise, except as may be set forth expressly in this Lease.

 

Section13.13 Arbitration.  Any and alldisputes relating to provisions or obligations in this Lease hereunder shall besubmitted to arbitration in accordance with the provisions of applicable statelaw, as from time to time amended. Arbitration proceedings, including the selection of an arbitrator, shallbe conducted pursuant to the rules, regulations and procedures from time totime in effect as promulgated by the American Arbitration Association.  Prior written notice of application by eitherparty for arbitration shall be given to the other at least ten (10) days beforesubmission of the application to the said Association’s office in Providence,Rhode Island.  The arbitrator shall hearthe parties and their evidence.  Thedecision of the arbitrator shall be binding and conclusive, and judgment uponthe award or decision of the arbitrator may be entered in the appropriate courtof law; and the parties consent to the jurisdiction of such court and furtheragree that any process of notice of motion or other application to the Court ora Judge thereof may be served outside the State of Rhode Island by registeredmail or by personal service, provided a reasonable time for appearance isallowed.  The costs and expenses of eacharbitration hereunder and their apportionment between the parties shall bedetermined by the arbitrator in his award or decision.  No arbitrable dispute shall be deemed to havearisen under this Lease prior to the expiration of the period of ten (10) daysafter the date of the giving of written notice by the party asserting theexistence of the dispute together with a description thereof sufficient for anunderstanding thereof.

 

Section 13.14  Confidentiality. Tenantacknowledges that the terms under which Landlord has leased the Premises toTenant, (including, without limitation, the rental rate(s), term and otherfinancial and business terms), constitute confidential information of Landlord(the “Confidential Information”). Tenant covenants and agrees to keep the Confidential Informationcompletely confidential; provided that (a) the Confidential Informationmay be disclosed by Tenant to those of its officers, employees, attorneys,accountants, lenders and financial advisors (collectively, “representatives”)who need to know such information in connection with Tenant’s use and occupancyof the Premises and for financial reporting and credit related activities (itbeing understood that Tenant shall inform its representatives of theconfidential nature of the Confidential Information and that suchrepresentatives shall be directed by Tenant to treat the ConfidentialInformation confidentially in accordance with the terms of this Section 13.14),and (b) unless required by securities regulations or other applicable law,any other disclosure of the

 

29

----

 

ConfidentialInformation may only be made if Landlord consents in writing prior to any suchdisclosure.

 

Section 13.15  Summary of Basic Terms.  The Summary of Basic Terms which is affixedto this Lease sets forth certain basic terms and information which isthereafter referred to in the main text of this Lease.  The Summary of Basic Terms, and everyparticular item thereon, shall be deemed incorporated by reference into themain text of this Lease.

 

Section 13.16  Tenant’s Purchase Option.  At anytime during the first six (6) monthsof last Lease Year of the Initial Term Tenant shall have the option ofpurchasing the Landlord’s Property for $4,457,750.00 by providing Landlord withwritten notice of its intention to do so setting forth a closing date which isat least six (6) months prior to the expiration of the Initial Term andnot less than fifteen (15) days after the date that such notice is sent.  In connection with the foregoing, Landlordagrees that other than for any mortgages that Landlord may encumber theproperty with during the Initial Term (which mortgages Landlord agrees it shallbe responsible for paying off and discharging in the event Tenant exercises itsrights under this Section 13.16) of the Lease, Landlord shall notencumber, restrict or alienate all or any portion of the Landlord’s Propertywithout the consent of the Tenant, which consent shall not be unreasonablywithheld, conditioned or delayed. Landlord and Tenant agree (i) that allclosing costs, including documentary stamps, recording charges and transfertaxes, shall be allocated in accordance with customary practice in the State ofRhode Island for similar transactions and (ii) to deliver such documents,certificates and affidavits as are customarily delivered in the State of RhodeIsland for similar transactions.

 

**[Remainder of Page Left Intentionally Blank]**

 

30

----

 

Tenantand Landlord, each by its duly authorized officer, has signed this Lease as ofthe date first set forth above.

 
|   | **TENANT****:**            |
|--------|----------------------------|
|   |                       |
|   | SUMMER  INFANT (USA), INC. |
|   |                       |
|   |                       |
|   | By:                        |   |
|   | Name:                      |  Joseph Driscoll |
|   | Title:                     |  CFO |
|   |                       |   |
|   | **LANDLORD****:**          |
|   |                       |
|   | FAITH  REALTY II, LLC      |
|   |                       |
|   |                       |
|   | By:                        |   |
|   | Name:                      |  Jason P. Macari |
|   | Title:                     |  Manager |
|        |                            |  |  |  |

 

 

Exhibits:

A— Property Description

B— Tenant Improvements Plans

C— Notice of Lease

 

----

 

**EXHIBIT****A**

 

PROPERTY DESCRIPTION

 

[To Be Attached]

 

----

 

EXHIBIT A

 

THE PROPERTY

 

That certain tract or parcel of land, withall buildings and improvements thereon, situated on the easterly and southerlyside of Park East Drive (extension), in the City of Woonsocket, County ofProvidence, State of Rhode Island, bounded and described as follows:

 

Beginning at a Rhode Island highway boundoil the southerly sideline of said Park East Drive (Extension), said pointbeing twenty-eight and 00/100 (28.00) feet left and opposite Station 85+ 16.66on State Highway Plat #2386;

 

Thence S35° 42' 33" W a distance- ofone hundred forty and 00/100 (140.00) feet to an angle point;

 

Thence S51° 51' 53" W a distance ofone hundred ninety-six and 44/100 (196.44) feet to an angle

 

Thence S40° 21' 03" W a distance ofone hundred thirty-three and 48/100 (133.48) feet to an angle point;

 

Thence S36° 12' 39" W a distance offorty-nine and 34/100 (49.34) feet to a corner;

 

Thence N54° 17' 27" W a distance oftwo hundred thirty-two and 38/100 (232.38) feet to an angle point;

 

Thence S86° 27' 52" W a distance ofone hundred seventy and 92/100 (170.92) feet to the easterly line of Park FastDrive;

 

Thence northerly bearing easterly alongthe arc of a curve having a radius of three-hundred twenty-two and 00/100(322.00) feet, an arc length of three hundred eighty-nine and 13/100 389.13)feet, a chord bearing of N50° 49' 35"E and a chord distance of threehundred sixty-five Byrd 88/100 (365.88) feet to a Rhode Island highway boundtwenty-eight (28.00) feet left and opposite station 89+51.85;

 

Thence N85° 26' 47"E continuing alongthe southerly sideline of Park East Drive, a distance of three hundred three,and 32/100 (303.32) feet to a Rhode Island highway bound twenty-eight (28.00)feet left and opposite Station 86+48.53;

 

Thence easterly bearing southerly alongthe arc of a curve having a radius of five hundred seventy-two and 00/100(572.00) feet, an arc length of one hundred twenty-five and 39/100 (125.39)feet, a chord bearing of S88° 16' 25"E and a chord distance of one hundredtwenty-five and 14/100 (125-14) feet to the point and place of beginning.

 

2

----

 

Said parcel is further designated as MapD7, D8 Lot 59-16 on plan entitled “ADMINISTRATIVE SUBDIVISION PLAN MAP D7, D8LOT 59-16 SITUATED ON: PARK EAST DRIVE (EXTENSION) WOONSOCKET, RHODE ISLANDSCALE: 1” = 40’ DATE: OCTOBER 2004 REVISED:  NOVEMBER, 2004 REVISED:JANUARY, 2005, FEBRUARY, 2005 PREPARED FOR: FAITH REALTY, LLC. 6 BLACKSTONE VALLEYPLACE SUITE 206A, LINCOLN, R.I. 02865  PREPARED BY: CROSSMAN ENGINEERING, INC. 151 Centerville Road Warwick,Rhode ISLAND 02886 (the “Subdivision Plan”), which Subdivision Plan, isrecorded at Plan Book 22, Page 59 of Woonsocket Land Evidence Records.

 

3

----

 

**EXHIBIT B**

 

TENANT IMPROVEMENT PLANS

 

[To Be Attached]

 

NONE

 

 

----

 

**EXHIBIT C**

 

NOTICE OF LEASE

 

[To Be Attached]

 

----

 

**NOTICE OF LEASE**

 

 

Notice is hereby given ofthe following described lease:

 
| Landlord:                        |   | Faith  Realty II, LLC, a Rhode Island limited liability company                                                                                                                                                      |
|----------------------------------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|                             |   |                                                                                                                                                                                                                 |
| Tenant:                          |   | Summer  Infant (USA), Inc., a Rhode Island corporation                                                                                                                                                          |
|                             |   |                                                                                                                                                                                                                 |
| Date  of Execution:              |   | March       ,  2009                                                                                                                                                               |
|                             |   |                                                                                                                                                                                                                 |
| Description  of Leased Premises: |   |  

The  land with the building and any other improvements now or hereafter thereon,  commonly known as 1275 Park East Drive, Woonsocket, Rhode Island, which is  more particularly described on Exhibit A. |
|                             |   |                                                                                                                                                                                                                 |
| Term:                            |   | 7  years                                                                                                                                                                                                             |
|                             |   |                                                                                                                                                                                                                 |
| Extension  Option:               |   | The  Tenant has the option to extend the Term for an additional five  (5) years on the terms and conditions set forth in the Lease.                                                                             |
|                             |   |                                                                                                                                                                                                                 |
| Commencement  Date:              |   | April 1,  2009                                                                                                                                                                                                  |
|                             |   |                                                                                                                                                                                                                 |
| Pertinent  Provisions:           |   | The  Tenant has the option to purchase the Leased Premises for $4,457,750 in  accordance with the terms of the Lease.                                                                                                |

 

**[Remainder of Page Left Intentionally Blank]**

 

----

 
| Signed  this        day of March, 2009. |                      |
|-----------------------------------------------------------------------|---------------------------|
|                                                                  | Faith  Realty II, LLC     |
|                                                                  |                      |
|                                                                  |                      |
|                                                                  |                      |
|                                                                  | Name:                     |
|                                                                  | Title:                    |
|                                                                  |                      |
|                                                                  | Summer  Infant (USA), Inc |
|                                                                  |                      |
|                                                                  |                      |
|                                                                  |                      |
|                                                                  | Name:                     |
|                                                                  | Title:                    |

 

STATE OF RHODE ISLAND

 
| Providence,  ss. | March      ,  2009 |
|------------------|--------------------------------------------------|

 

Thenpersonally appeared the above-named                          the                          of Faith Realty II, LLC, known to me to be the person described in and whoexecuted the foregoing instrument in such capacity and acknowledged same to behis free act and deed and the free act and deed of Faith Realty II, LLC.

 
|   |                    |   |
|--------|-------------------------|--------|
|   | Notary  Public          |
|   | My  commission expires: |

 

 

STATE OF RHODE ISLAND

 
| Providence,  ss. | March      ,  2009 |
|------------------|--------------------------------------------------|

 

Thenpersonally appeared the above-named                          the                          of Summer Infant (USA), Inc., known to me to be the person described inand who executed the foregoing instrument in such capacity and acknowledged thesame to be his free act and deed and the free act and deed of Summer Infant(USA), Inc.

 
|   |                    |   |
|--------|-------------------------|--------|
|   | Notary  Public          |
|   | My  commission expires: |

 

----

 

**EXHIBIT A**

 

**Legal Description**

 

That certain tract or parcel of land, withall buildings and improvements thereon, situated on the easterly and southerlyside of Park East Drive (extension), in the City of Woonsocket, County ofProvidence, State of Rhode Island, bounded and described as follows:

 

Beginning at a Rhode Island highway boundoil the southerly sideline of said Park East Drive (Extension), said pointbeing twenty-eight and 00/100 (28.00) feet left and opposite Station 85+ 16.66on State Highway Plat #2386;

 

Thence S35° 42' 33" W a distance- ofone hundred forty and 00/100 (140.00) feet to an angle point;

 

Thence S51° 51' 53" W a distance ofone hundred ninety-six and 44/100 (196.44) feet to an angle

 

Thence S40° 21' 03" W a distance ofone hundred thirty-three and 48/100 (133.48) feet to an angle point;

 

Thence S36° 12' 39" W a distance offorty-nine and 34/100 (49.34) feet to a corner;

 

Thence N54° 17' 27" W a distance oftwo hundred thirty-two and 38/100 (232.38) feet to an angle point;

 

Thence S86° 27' 52" W a distance ofone hundred seventy and 92/100 (170.92) feet to the easterly line of Park FastDrive;

 

Thence northerly bearing easterly alongthe arc of a curve having a radius of three-hundred twenty-two and 00/100(322.00) feet, an arc length of three hundred eighty-nine and 13/100 389.13)feet, a chord bearing of N50° 49' 35"E and a chord distance of threehundred sixty-five Byrd 88/100 (365.88) feet to a Rhode Island highway boundtwenty-eight (28.00) feet left and opposite station 89+51.85;

 

Thence N85° 26' 47"E continuing alongthe southerly sideline of Park East Drive, a distance of three hundred three,and 32/100 (303.32) feet to a Rhode Island highway bound twenty-eight (28.00)feet left and opposite Station 86+48.53;

 

Thence easterly bearing southerly alongthe arc of a curve having a radius of five hundred seventy-two and 00/100(572.00) feet, an arc length of one hundred twenty-five and 39/100 (125.39)feet, a chord bearing of S88° 16' 25"E and a chord distance of one hundredtwenty-five and 14/100 (125-14) feet to the point and place of beginning.

 

Said parcel is further designated as MapD7, D8 Lot 59-16 on plan entitled “ADMINISTRATIVE SUBDIVISION PLAN MAP D7, D8LOT 59-16 SITUATED ON: PARK EAST DRIVE (EXTENSION) WOONSOCKET, RHODE ISLANDSCALE: 1” = 40’ DATE: OCTOBER 2004 REVISED:  NOVEMBER, 2004 REVISED:JANUARY, 2005, FEBRUARY, 2005 PREPARED FOR: FAITH REALTY, LLC. 6 BLACKSTONEVALLEY PLACE SUITE 206A, LINCOLN, R.I. 02865  PREPARED BY: CROSSMAN ENGINEERING, INC. 151 Centerville Road Warwick,Rhode ISLAND 02886 (the “Subdivision Plan”), which Subdivision Plan, isrecorded at Plan Book 22, Page 59 of Woonsocket Land Evidence Records.

 

----