Document:

Exhibit 10.4

 

PRUDENTIAL CENTER

 

I N  D  E  X  T  O  L  E  A
S  E

 

FROM

 

BP 111 HUNTINGTON AVE LLC

 

TO

 

FEDERAL HOME LOAN BANK OF BOSTON

 

	
  ARTICLE

  NUMBER

  	
   

  	
  CAPTION

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  I

  	
   

  	
  BASIC LEASE PROVISIONS AND
  ENUMERATION OF EXHIBITS

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  II

  	
   

  	
  PREMISES, EXPANSION OPTION AND
  RIGHT OF FIRST OFFER

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  III

  	
   

  	
  LEASE TERM AND EXTENSION OPTIONS

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  IV

  	
   

  	
  CONSTRUCTION

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  V

  	
   

  	
  ANNUAL FIXED RENT AND ELECTRICITY
  AND SPECIAL ALLOWANCES

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  VI

  	
   

  	
  TAXES AND OPERATING EXPENSES

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  VII

  	
   

  	
  LANDLORD’S
  REPAIRS AND SERVICES

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  VIII

  	
   

  	
  TENANT’S
  REPAIRS

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  IX

  	
   

  	
  ALTERATIONS

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  X

  	
   

  	
  PARKING

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  XI

  	
   

  	
  CERTAIN TENANT
  COVENANTS

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  XII

  	
   

  	
  ASSIGNMENT AND
  SUBLETTING

  	
   

  	
   

  

 

i

 

	
  XIII

  	
   

  	
  INDEMNITY AND
  COMMERCIAL GENERAL LIABILITY INSURANCE

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  XIV

  	
   

  	
  FIRE, CASUALTY
  AND TAKING

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  XV

  	
   

  	
  DEFAULT

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  XVI

  	
   

  	
  MISCELLANEOUS
  PROVISIONS

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Section 16.1

  	
  Waiver

  	
   

  	
   

  
	
   

  	
   

  	
  Section 16.2

  	
  Cumulative
  Remedies

  	
   

  	
   

  
	
   

  	
   

  	
  Section 16.3

  	
  Quiet
  Enjoyment

  	
   

  	
   

  
	
   

  	
   

  	
  Section 16.4

  	
  Surrender

  	
   

  	
   

  
	
   

  	
   

  	
  Section 16.5

  	
  Brokerage

  	
   

  	
   

  
	
   

  	
   

  	
  Section 16.6

  	
  Invalidity
  of Particular Provisions

  	
   

  	
   

  
	
   

  	
   

  	
  Section 16.7

  	
  Provisions
  Binding, Etc.

  	
   

  	
   

  
	
   

  	
   

  	
  Section 16.8

  	
  Recording

  	
   

  	
   

  
	
   

  	
   

  	
  Section 16.9

  	
  Notices and
  Time for Action

  	
   

  	
   

  
	
   

  	
   

  	
  Section 16.10

  	
  When Lease
  Becomes Binding

  	
   

  	
   

  
	
   

  	
   

  	
  Section 16.11

  	
  Paragraph
  Headings

  	
   

  	
   

  
	
   

  	
   

  	
  Section 16.12

  	
  Rights of
  Mortgagee

  	
   

  	
   

  
	
   

  	
   

  	
  Section 16.13

  	
  Rights of
  Ground Lessor

  	
   

  	
   

  
	
   

  	
   

  	
  Section 16.14

  	
  Notice to
  Mortgagee and Ground Lessor

  	
   

  	
   

  
	
   

  	
   

  	
  Section 16.15

  	
  Assignment
  of Rents

  	
   

  	
   

  
	
   

  	
   

  	
  Section 16.16

  	
  Status
  Report and Financial Statements

  	
   

  	
   

  
	
   

  	
   

  	
  Section 16.17

  	
  Self-Help

  	
   

  	
   

  
	
   

  	
   

  	
  Section 16.18

  	
  Holding
  Over

  	
   

  	
   

  
	
   

  	
   

  	
  Section 16.19

  	
  Entry by
  Landlord

  	
   

  	
   

  
	
   

  	
   

  	
  Section 16.20

  	
  Tenant’s
  Payments

  	
   

  	
   

  
	
   

  	
   

  	
  Section 16.21

  	
  Late
  Payment

  	
   

  	
   

  
	
   

  	
   

  	
  Section 16.22

  	
  Counterparts

  	
   

  	
   

  
	
   

  	
   

  	
  Section 16.23

  	
  Entire
  Agreement

  	
   

  	
   

  
	
   

  	
   

  	
  Section 16.24

  	
  Landlord
  Liability

  	
   

  	
   

  
	
   

  	
   

  	
  Section 16.25

  	
  No Partnership

  	
   

  	
   

  
	
   

  	
   

  	
  Section 16.26

  	
  Security
  Deposit

  	
   

  	
   

  
	
   

  	
   

  	
  Section 16.27

  	
  Governing
  Law

  	
   

  	
   

  
	
   

  	
   

  	
  Section 16.28

  	
  Signage

  	
   

  	
   

  
	
   

  	
   

  	
  Section 16.29

  	
  Antenna
  Area

  	
   

  	
   

  
	
   

  	
   

  	
  Section 16.30

  	
  Rules and
  Regulations

  	
   

  	
   

  

 

ii

 

PRUDENTIAL CENTER

 

THIS INSTRUMENT IS AN INDENTURE OF LEASE in which the Landlord and the
Tenant are the parties hereinafter named, and which relates to space in the
building to be known as 111 Huntington Avenue, Boston, Massachusetts.

 

The parties to this instrument hereby agree with each other as follows:

 

ARTICLE I  

BASIC LEASE PROVISIONS AND ENUMERATIONS OF EXHIBITS

 

1.1           INTRODUCTION. The following sets forth the basic data and
identifying Exhibits elsewhere hereinafter referred to in this Lease, and,
where appropriate, constitute definitions of the terms hereinafter listed.

 

	
  1.2

  	
   

  	
  BASIC
  DATA.

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Date:

  	
   

  	
  June 21,
  2000

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Landlord:

  	
   

  	
  BP
  111 Huntington Ave LLC

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Present
  Mailing Address of Landlord:

  	
   

  	
  c/o
  Boston Properties Limited Partnership

  Prudential Center

  800 Boylston Street

  Boston, Massachusetts 02199

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Landlord’s
  Construction Representative:

  	
   

  	
  John
  Camera

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Tenant:

  	
   

  	
  Federal
  Home Loan Bank of Boston,

  a Federal instrumentality

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Present
  Mailing Address of Tenant:

  	
   

  	
  One
  Financial Center

  Boston, Massachusetts 02111

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Tenant’s
  Construction Representative:

  	
   

  	
  Carol
  Whaley

  

 

1

 

	
   

  	
   

  	
  Term
  or Lease Term: (sometimes
  called the “Original Lease Term”)

  	
   

  	
  One
  hundred thirty-two (132) calendar months (plus the partial month, if any,
  immediately following the Commencement Date), unless extended or sooner
  terminated as hereinafter provided.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Extension
  Options:

  	
   

  	
  Two
  (2) periods of five (5) years each as provided in and on the terms
  set forth in Section 3.2 hereof.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Lease
  Year:

  	
   

  	
  A
  period of twelve (12) consecutive calendar months, commencing on the first
  day of January in each year, except that the first Lease Year of the
  Lease Term hereof shall be the period commencing on the Commencement Date and
  ending on the succeeding December 31, and the last Lease Year of the
  Lease Term hereof shall be the period commencing on January 1 of the
  calendar year in which the Lease Term ends, and ending with the date on which
  the Lease Term ends.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Commencement
  Date:

  	
   

  	
  As
  defined in Section 3.1 hereof.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Premises:

  	
   

  	
  The
  entirety of the 24th and 25th floors of the Building,
  and an area on the 23rd floor of the Building, in accordance with
  the floor plans annexed hereto as Exhibit D and incorporated herein by
  reference, as further defined and limited in Section 2.1 hereof.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Rentable
  Floor Area of the Premises:

  	
   

  	
  Approximately
  60,774 square feet

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Annual
  Fixed Rent:

  	
   

  	
  (I)  During Lease Year 1: At the annual rate of
  $2,582,652.00 (i.e., the sum of 1,925,320,00, being the product of (i) $40,00
  and (ii) 48,133 square feet of Rentable Floor Area of the Premises, plus
  (y) $657,332.00, being the product of (i) $52.00 and (ii) 12,641
  square feel of Rentable Floor Area of the Premises).

  

 

1

 

	
   

  	
   

  	
  Term
  or Lease Term: (sometimes called the “Original Lease Term”)

  	
   

  	
  One
  hundred thirty-two (132) calendar months (plus the partial month, if any,
  immediately following the Commencement Date), unless extended or sooner
  terminated as hereinafter provided.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Extension
  Options:

  	
   

  	
  Two
  (2) periods of five (5) years each as provided in and on the terms
  set forth in Section 3.2 hereof.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Lease
  Year:

  	
   

  	
  A
  period of twelve (12) consecutive calendar months, commencing on the first
  day of January in each year, except that the first Lease Year of the
  Lease Term hereof shall be the period commencing on the Commencement Date and
  ending on the succeeding December 31, and the last Lease Year of the
  Lease Term hereof shall be the period commencing on January 1 of the
  calendar year in which the Lease Term ends, and ending with the date on which
  the Lease Term ends.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Commencement
  Date:

  	
   

  	
  As
  defined in Section 3.1 hereof.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Premises:

  	
   

  	
  The
  entirety of the 24th and 25th floors of the Building,
  and an area on the 23rd floor of the Building, in accordance with
  the floor plans annexed hereto as Exhibit D and incorporated herein by
  reference, as further defined and limited in Section 2.1 hereof.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Rentable
  Floor Area of the Premises:

  	
   

  	
  Approximately
  60,774 square feet

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Annual
  Fixed Rent:

  	
   

  	
  (I)   During Lease Year 1: At the annual rate of
  $2,582,652 (i.e., the sum of (x) 1,925,320,00, being the product of (i) $40.00
  and (ii) 48,133 square feet of Rentable Floor Area of the Premises, plus
  (y) $657,332.00, being the product of (i) $52.00 and (ii) 12,641
  square feet of Rentable Floor Area of the Premises).

  

 

2

 

	
   

  	
   

  	
   

  	
   

  	
  (II)  During Lease Years 2-5: At the annual rate
  of $3,160,248.00, being the product of (i) $52.00 and (ii) the
  Rentable Area Floor Area of the Premises (hereinabove defined in this Section 1.2).

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  (III)  During the remainder of the Original Lease
  Term: At the annual rate of $3,464,118.00, being the product of (i) $57.00
  and (ii) the Rentable Floor Area of the Premises (hereinabove defined in
  this Section 1.2).

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Tenant
  Electricity:

  	
   

  	
  See
  Exhibit F.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Additional
  Rent:

  	
   

  	
  All
  charges and other sums payable by Tenant as set forth in this Lease, in
  addition to Annual Fixed Rent.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Initial
  Minimum Limits of Tenant’s Commercial General Liability Insurance:

  	
   

  	
  $3,000,000
  combined single limit per occurrence on a per location basis.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Total
  Rentable Floor Area of the Building:

  	
   

  	
  931,585
  square feet.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Total
  Rentable Floor Area of the Office Portion of the Building:

  	
   

  	
  867,352
  square feet

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Total
  Rentable Floor Area of the Retail Portion of the Building:

  	
   

  	
  64,233
  square feet

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Overlease:

  	
   

  	
  A
  certain amended and restated lease and easement agreement between BP
  Prucenter Acquisition LLC (with its successors and assigns, “Overlandlord”)
  as landlord and Landlord as tenant.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Overlease
  Premises:

  	
   

  	
  The
  premises demised to Landlord under the Overlease as described on Exhibit I.

  

 

3

 

	
   

  	
   

  	
  Building:

  	
   

  	
  For
  the purposes of this Lease, the Building shall mean the building and other
  improvements on the Overlease Premises commonly known as 111 Huntington
  Avenue located in the Prudential Center (as hereinafter defined), as the same
  may be altered, expanded, reduced or otherwise changed by Landlord from time
  to time.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Retail
  Portion of the Building:

  	
   

  	
  All
  of the space in the Building available, from time to time, for lease and occupancy
  by retail and other non-office tenants.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Office
  Portion of the Building:

  	
   

  	
  The
  Building, other than the Retail Portion of the Building.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Prudential
  Center:

  	
   

  	
  For
  purposes of this Lease, the Prudential Center shall mean the land described
  on Exhibit A and the buildings, garages and other improvements thereon,
  commonly known as Prudential Center, as the same may be altered, expanded,
  reduced or otherwise changed from time to time.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  PruOwner:

  	
   

  	
  Each
  owner of record or tenant under a ground lease, from time to time, of all or
  any portion of the Prudential Center.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Permitted
  Use:

  	
   

  	
  General
  office use, including banking operations (non-retail), a trading desk and an
  employee cafeteria (not open to the general public) and activities incidental
  to non-retail banking operations.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Broker:

  	
   

  	
  Meredith & Grew

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Security
  Deposit:

  	
   

  	
  None

  

 

1.3           ENUMERATION OF EXHIBITS. The following Exhibits attached hereto are
a part of this Lease, are incorporated herein by reference, and are to be
treated as a part of this Lease for all purposes. Undertakings contained in
such Exhibits are agreements on the part of Landlord and Tenant, as the case
may be, to perform the

 

4

 

obligations stated therein to be performed by Landlord and Tenant, as
and where stipulated therein.

 

	
  Exhibit A

  	
   

  	
  —

  	
   

  	
  Legal
  Description of the Prudential Center.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Exhibit B-1

  	
   

  	
  —

  	
   

  	
  Tenant
  Plan and Working Drawing Requirements

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Exhibit B-2

  	
   

  	
  —

  	
   

  	
  Base
  Building Specifications

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Exhibit C

  	
   

  	
  —

  	
   

  	
  Landlord’s
  Services.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Exhibit D

  	
   

  	
  —

  	
   

  	
  Floor
  Plan.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Exhibit E

  	
   

  	
  —

  	
   

  	
  Form of
  Commencement Date Agreement.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Exhibit F

  	
   

  	
  —

  	
   

  	
  Memorandum
  Re: Procedure for Adjustment of Electricity Costs.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Exhibit G

  	
   

  	
  —

  	
   

  	
  Broker
  Determination of Fair Market Rental Value.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Exhibit H

  	
   

  	
  —

  	
   

  	
  List
  of Mortgagees.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Exhibit I

  	
   

  	
  —

  	
   

  	
  Parking
  Plan.

  

 

ARTICLE II

PREMISES

 

2.1           DEMISE AND LEASE OF PREMISES. Landlord hereby demises and leases to Tenant,
and Tenant hereby hires and accepts from Landlord, the Premises in the Building,
excluding exterior faces of exterior walls, the common stairways and stairwells,
elevators and elevator walls, mechanical rooms, electric and telephone closets,
janitor closets, and pipes, ducts, shafts, conduits, wires and appurtenant fixtures
serving exclusively or in common other parts of the Building, and if the Premises
includes less than the entire rentable area of any floor, excluding the common
corridors, elevator lobbies and toilets located on such floor.

 

2.2           TENANT’S EXPANSION OPTION. On the conditions (which conditions Landlord
may waive by written notice to Tenant) that at the time that Tenant gives
Landlord the Expansion Notice, as hereinafter defined, (i) there exists no
“Event of Default” (defined in Section 15.1), (ii) Tenant occupies at
least 50% of the Rentable Floor Area of the Premises (the “Occupancy Condition”),
and (iii) this Lease is still in full force and effect, Tenant shall have
the option to lease the balance of the 23rd floor of the Building
containing 12,108 square feet of Rentable Floor Area (“Expansion Area”).

 

5

 

A.            Exercise of Rights to Expansion Area. Tenant may exercise its option to lease the
Expansion Area by giving written notice (“Exercise Notice”) to Landlord on or
before the Notice Date, as defined in Subparagraph C of this Section 2.2.
If Tenant fails timely to give such notice, Tenant shall have no further right
to lease such Expansion Area, time being of the essence of this Section 2.2.
Upon the timely giving of such notice, Landlord shall lease and demise to
Tenant, and Tenant shall hire and take from Landlord, such Expansion Area,
without the need for further act or deed by either party, for the term and upon
all of the same terms and conditions of this Lease, except as hereinafter set forth.

 

B.            Expiration Date of Leases in Expansion Area. Landlord hereby agrees that if the
Expansion Area, or any portion thereof, is occupied by another tenant(s) during
the Expiration Period, as hereinafter defined, the expiration date of the lease
of such tenant(s) shall occur before the end of the Expiration Period. As used
herein, the Expiration Period shall mean the twelve month period commencing as
of the fifth (5th) anniversary of the initial Commencement Date and
ending as of the day immediately preceding the sixth (6th)
anniversary of said Commencement Date. Landlord shall advise Tenant, upon
written request made from time to time during the Term, of the expiration date
of the lease of any tenant of the Expansion Area.

 

C.            Notice Date. The Notice Date in respect of the Expansion Area shall be the date
fifteen (15) months prior to the first day of the Expiration Period.

 

D.            Lease Provisions Applying to Expansion Area. The leasing to Tenant of the Expansion Area
shall be upon all the same terms and conditions of the Lease except as follows:

 

(1)           Commencement Date

 

(i)            If no tenant is occupying the Expansion Area
during the Expiration Period, then the Commencement Date in respect of the
Expansion Area shall be the first day of the Expiration Period.

 

(ii)           Otherwise, the Commencement Date in respect
of each portion of the Expansion Area shall be the later of (i) the
expiration date of the lease of the tenant occupying such portion of the
Expansion Area, and (ii) the date that such tenant vacates such portion of
the Expansion Area.

 

6

 

(2)           Annual Fixed Rent

 

The Annual Fixed Rent
payable in respect of the Expansion Area shall be based upon the Fair Market
Rental Value of the Expansion Area, as of the Commencement Date in respect of
the Expansion Area based upon the use of the Expansion Area as first-class
office space in comparable first-class office buildings within the City of
Boston. No later than sixty (60) days prior to the Notice Date Tenant may
request that Landlord designate the Annual Fixed Rent payable in respect of the
Expansion Area, and Landlord shall designate the Annual Fixed Rent payable in
respect of the Expansion Area within thirty (30) days thereafter but Landlord
shall not be required to make such designation more than 60 days prior to the
Notice Date. If Tenant disagrees with Landlord’s determination of the Fair
Market Rental Value applicable to the Expansion Area, Tenant shall have the
right, in the Exercise Notice, to make a request to Landlord for a broker
determination of such Fair Market Rental Value, which broker determination
shall be made in the manner set forth in Exhibit G.

 

(3)           Operating Expenses

 

The provisions of Article VI
shall be applied to the Expansion Area separately from the remainder of the
Premises, and shall be modified as follows:

 

Operating Expenses Allocable
to the Expansion Area shall be equal to the same proportion of the Operating
Expenses for the Building (as defined in Section 6.2, including, without
limitation the paragraph titled “Gross-Up Provision”) as the Rentable Floor
Area of the Expansion Area bears to the Total Rentable Floor Area of the Office
Portion of the Building.

 

Base Operating Expenses in respect
of the Expansion Area shall be equal to the actual amount of Operating Expenses
Allocable to the Expansion Area for the calendar year immediately preceding the
calendar year in which the Commencement Date in respect of the Expansion Area occurs.

 

(4)           Condition of Expansion Area

 

The Expansion Area shall be
delivered by Landlord and accepted by Tenant “as-is”, in its then (i.e., as of
the Commencement Date in respect of the Expansion Area), state of construction,
finish and decoration, without any obligation on the part of Landlord to
prepare or construct the Expansion Area for Tenant’s occupancy, or to provide
any contribution to Tenant in respect of the Expansion Area. Without limiting

 

7

 

the foregoing, Landlord shall have no obligation to remove or alter
existing multi-tenant corridors in the Expansion Area.

 

E.             Notwithstanding the fact that Tenant’s
exercise of the above-described expansion option shall be self-executing, as
aforesaid, the parties hereby agree promptly to execute a lease amendment
reflecting the addition of the Expansion Area. The execution of such lease
amendment shall not be deemed to waive any of the conditions to Tenant’s
exercise of the herein expansion option, unless otherwise specifically provided
in such lease amendment.

 

2.3           RIGHT OF FIRST OFFER. Provided that at the time any portion of
the First Offer Space, as hereinafter defined, first becomes available for
reletting (i) no “Event of Default” (as defined in Section 15.1) of Tenant
exists, (ii) Tenant is satisfying the Occupancy Condition, and (iii) the
Lease is still in full force and effect, Landlord agrees not to enter into a
lease or leases to relet the First Offer Space or any portion thereof without
first giving to Tenant an opportunity to lease such space as hereinafter set
forth. For the purposes hereof, the “First Offer Space” shall be defined as any
separately demised space on Floors 22, 23 and 26 of the Building which becomes
available for reletting, as hereinafter defined. When any portion of such First
Offer Space becomes available for reletting, as hereinafter defined, Landlord
shall notify Tenant (“Landlord’s First Notice”) of the availability of such
space and the business terms upon which Landlord is willing to so lease such
space (the “Business Terms”). For the purposes hereof, First Offer Space shall
be deemed “available for reletting” when Landlord determines that the then
current tenant of such First Offer Space will vacate such First Offer Space and
when Landlord intends to offer such First Offer Space for lease. The parties
acknowledge that, as of the Date of this Lease, none of the First Offer Space
is leased. Therefore, no portion of the First Offer Space shall be deemed “available
for reletting” until each such First Offer Space has been leased to a third
party and thereafter Landlord determines that such third party tenant of such
First Offer Space will vacate such First Offer Space If Tenant wishes to
exercise Tenant’s right of first offer with respect to such First Offer Space
on the Business Terms set forth in Landlord’s First Notice, Tenant shall do so,
if at all, by giving Landlord notice (“Tenant’s Acceptance Notice”) of Tenant’s
desire to enter into an amendment to this Lease to incorporate the entire
amount of such First Offer Space into the Premises demised under the Lease
(Tenant having no right to lease less than the entire amount of such First
Offer Space offered to Tenant) on such Business Terms on or before the date
twenty (20) days after Tenant’s receipt of Landlord’s First Notice. If Tenant
shall timely give Tenant’s Acceptance Notice, the same shall automatically
constitute an amendment to this Lease and an agreement to enter into
appropriate documentation of such amendment within thirty (30) days after
Tenant’s Acceptance Notice, however, the failure of the parties to execute such
documentation shall not negate the exercise of Tenant’s right hereunder and the
leasing of such additional space shall

 

8

 

be upon the terms set forth in this Lease except as otherwise provided
in Landlord’s First Notice, If Tenant shall not advise Landlord that it is
interested in leasing the First Offer Space so offered within twenty (20) days
after Tenant’s receipt of Landlord’s First Notice or if Tenant shall not send
Tenant’s Acceptance Notice within the applicable time period set forth above
after Tenant’s receipt of the Business Terms, time being of the essence,
Landlord shall be free at any time within six (6) months after Landlord’s
First Notice to enter into a lease of such space (but not less than or more
than such space) with another prospective tenant upon terms which are not less
than 95% of the average of the effective rent (i.e. taking into account any rent
and other economic concessions and tenant improvement allowances offered by
Landlord) set forth in Landlord’s notice to Tenant of the Business Terms;
provided that (i) Landlord shall reoffer such First Offer Space to Tenant
in accordance with and subject to the terms of this Section 2.3 prior to
leasing such First Offer Space or any portion thereof (a) if such terms
are less than 95% of the average of effective rent set forth in Landlord’s
notice, as aforesaid, (b) if such lease is to be entered into more than
six (6) months after Landlord’s First Notice, (c) if Landlord offers
to lease such First Offer Space in smaller or larger increments than set forth
in Landlord’s First Notice, or (d) if Landlord offers to the tenant
leasing such First Offer Space expansion rights or rights of first offer which
are materially different than those set forth in Landlord’s First Notice; (ii) Tenant
shall have only ten (10) business days to give Tenant’s Acceptance Notice
with respect to any such reoffer of such First Offer Space, except that if the
sole reason that Landlord reoffers such First Offer Space to Tenant is based
upon differences in the expansion rights or rights of first offer, then Tenant
shall have only three (3) business days to give Tenant’s Acceptance Notice.

 

The terms of this Section 2.3 shall continue to apply to the First
Offer Space which Tenant elects not to lease following its receipt of a
Landlord’s First Notice with respect thereto, provided that with respect to
First Offer Space, Landlord will not be obligated under this Section 2.3
to offer such First Offer Space to Tenant again until after the tenancy
(including any extension options or renewal) of the next tenant of such area.

 

2.4           APPURTENANT RIGHTS AND RESERVATIONS. Subject to Landlord’s or Overlandlord’s or
any other PruOwner’s right to change or alter any of the following in its
discretion as herein provided, Tenant shall have, as appurtenant to the
Premises, the non-exclusive right to use in common with others, but not in a
manner or extent that would materially interfere with the normal operation and
use of the Building as a multi-tenant office building and subject to reasonable
rules of general applicability to tenants of the Building from time to
time made by Landlord or Overlandlord or any other PruOwner of which Tenant is
given notice: (a) the common lobbies, corridors, stairways, and elevators
of the Building, and the pipes, ducts, shafts, conduits, wires and appurtenant
meters and equipment

 

9

 

serving the Premises in common with others, (b) the loading areas
serving the Building and the common walkways and driveways necessary for access
to the Building, (c) if the Premises include less than the entire rentable
floor area of any floor, the common toilets, corridors and elevator lobby of
such floor and (d) the plazas and other common areas of the Prudential
Center as Landlord or Overlandlord, or any other PruOwner as the case may be,
makes the same available from time to time; and no other appurtenant rights and
easements. Notwithstanding anything to the contrary herein, Landlord has no
obligation to allow any particular telecommunication service provider to have
access to the Building or to the Premises, but Landlord shall not be unreasonable
in denying such access; however Landlord shall not deny access to the
particular telecommunications service providers who are providing service to
Tenant’s trading desk or in connection with Tenant’s banking operations. If
Landlord permits such access, Landlord may condition such access upon the
payment to Landlord by the service provider of fees assessed by Landlord in its
reasonable discretion to defray Landlord’s expenses associated therewith.
Landlord shall assess such fees at the standard rate for the Building.

 

Landlord reserves for the benefit of it and of Overlandlord and of any
other PruOwner the right from time to time, without unreasonable interference
with Tenant’s use: (a) to install, use, maintain, repair, replace and
relocate for service to the Premises and other parts of the Building, or
either, pipes, ducts, conduits, wires and appurtenant fixtures, wherever
located in the Premises or the Building, and (b) to alter or relocate any
other common facility, provided that substitutions are substantially equivalent
or better, provided that any such alteration shall not materially reduce the
Rentable Floor Area of the Premises. Installations, replacements and
relocations referred to in clause (a) above shall be located so far as
practicable in the central core area of the Building, above ceiling surfaces,
below floor surfaces or within perimeter walls of the Premises. Except in the
case of emergencies, Landlord agrees to use all reasonable efforts to give, or
cause Overlandlord or such PruOwner to give, Tenant reasonable advance notice
of any of the foregoing activities which require work in the Premises.

 

Landlord reserves and excepts for its benefit and the benefit of
Overlandlord and any other PruOwner all rights of ownership and use in all
respects outside the Premises, including without limitation, the Building and
all other structures and improvements and plazas and common areas in the
Prudential Center, except that at all times during the term of this Lease
Tenant shall have a reasonable means of access from a public street to the
Premises. Without limitation of the foregoing reservation of rights by
Landlord, it is understood that in its sole discretion Landlord or Overlandlord
or any other PruOwner, as the case may be, shall have the right to change and
rearrange the plazas and other common areas, to change, relocate and eliminate
facilities therein, to erect new buildings thereon, to permit the use of or
lease all or part thereof for exhibitions and displays and to sell, lease

 

10

 

or dedicate all or part thereof to public use; and further that
Landlord or Overlandlord or any other PruOwner, as the case may be, shall have
the right to make changes in, additions to and eliminations from the Building
and other structures and improvements in the Prudential Center, the Premises
excepted, but the costs thereof shall not be included in Operating Expenses
hereinafter defined; provided however that Tenant, its employees, agents,
clients, customers, and invitees shall at all times have reasonable access to
the Building and Premises, Landlord is not under any obligation to permit
individuals without proper building identification to enter the Building after
6:00 p.m.

 

ARTICLE III

LEASE TERM

 

3.1           TERM. The Term of this Lease shall be the period specified in Section 1.2
hereof as the “Lease Term”, unless sooner terminated. If Section 1.2
provides for a fixed Commencement Date, then the Commencement Date of the Lease
Term hereof shall be such date. Otherwise, the Lease Term hereof shall commence
on, and the Commencement Date shall be, the first to occur of:

 

(a)           The day on which the Premises are delivered by Landlord to Tenant; or

 

(b)           The date upon which Tenant commences beneficial use of the Premises.

 

In the case where the Landlord is to perform work to the Premises as
provided in Article IV, the Premises shall be considered delivered by the
Landlord to the Tenant on the day when the Premises are substantially complete,
as defined in Section 4.1 hereof.

 

As soon as may be convenient alter the Commencement Date has been
determined, Landlord and Tenant agree to join with each other in the execution,
in the form of Exhibit E hereto, of a written Commencement Date Agreement
in which the Commencement Date and specified Lease Term of this Lease shall be
stated. If Tenant shall fail to execute such Agreement, the Commencement Date
and Lease Term shall be as reasonably determined by Landlord in accordance with
the terms of this Lease.

 

3.2           EXTENSION OPTIONS.

 

(A)          Exercise of Option. On the conditions (which conditions
Landlord may waive by written notice to Tenant) that at the time of exercise of
the herein described options to extend (i) there exists no “Event of
Default” (defined in Section 15.1), and (ii) this Lease is still in
full force and effect, Tenant shall have the right, by giving written notice (“Extension
Notice”) to Landlord on or before the date (“Notice Date”) fifteen (15) months
prior to the expiration of the Term of

 

11

 

this Lease (as it may have been previously extended) to extend the Term
hereof upon all the same terms, conditions, covenants and agreements herein
contained (except for the Annual Fixed Rent which shall be equal to ninety-five
percent (95%) of the Fair Market Rental Value as determined in accordance with
clause (B) hereof and except that there shall be no further option to
extend beyond the options set forth herein) for two (2) periods of five (5) years
each as hereinafter set forth. Each option period is sometimes herein referred
to as the “Extended Term.” Notwithstanding the foregoing, the Base Operating
Expenses, as defined in Section 6.2 (including, without limitation, the
paragraph thereof titled “Gross Up Provision”) shall be equal to the actual
amount of Operating Expenses for the calendar year immediately preceding the
calendar year in which the applicable Extended Term commences. Notwithstanding
any implication to the contrary Landlord has no obligation to make any
additional payment to Tenant in respect of any construction allowance or the
like or to perform any work to the Premises as a result of the exercise by
Tenant of any such option.

 

(B)           Determination of Fair Market Rental Value. “Fair Market Rental Value” shall be
determined based on the use of the Premises as first class office space utilizing
properties of a similar character in comparable first-class office buildings within
the City of Boston (“Landlord’s Determination”)., No later than sixty days prior
to the Notice Date Tenant may request that Landlord designate the Annual Fixed
Rent payable in respect of the Expansion Area, and Landlord shall designate the
Annual Fixed Rent payable during the Extended Term in question (“Landlord’s
Determination”) within thirty (30) days thereafter but Landlord shall not be
required to make such designation more than seventeen (17) months prior to the
commencement of the Extended Term in question. The Annual Fixed Rent shall be
equal to 95% of the Fair Market Rental Value. If Tenant disagrees with Landlord’s
Determination, then Tenant shall have the right, in the Extension Notice, to
make a request to Landlord for a broker determination (the “Broker Determination”)
of the Fair Market Rental Value for such Extended Term, which Broker
Determination shall be made in the manner set forth in Exhibit G. If Tenant
fails timely to request the Broker Determination, then the Term of the Lease
shall be extended for the applicable Extended Term and the Annual Fixed Rent
for such Extended Term shall be equal to the Landlord’s Determination.

 

(C)           Confirmation of Exercise. Upon the giving of notice by Tenant to Landlord
exercising Tenant’s applicable option to extend the Lease Term in accordance
with the provisions of Section 3.2 (A) above, then this Lease and the
Lease Term hereof shall automatically be deemed extended, for the applicable Extended
Term, without the necessity for the execution of any additional documents,
except that Landlord and Tenant agree to enter into an instrument in writing
setting forth the Annual Fixed Rent for the applicable Extended Term as determined
in the relevant manner set forth in this Section 3.2; and in such event all
references herein to the Lease Term or the Term of this Lease shall be

 

12

 

construed as referring to the Lease Term, as so extended, unless the
context clearly otherwise requires, and except that there shall be no further
option to extend the Lease Term, beyond the options set forth herein.
Notwithstanding anything contained herein to the contrary, in no event shall
Tenant have the right to exercise more than one extension option at a time and,
further, Tenant shall not have the right to exercise its second extension
option unless it has duly exercised its first extension option.

 

ARTICLE IV

CONSTRUCTION

 

4.0           LANDLORD’S WORK.

 

In accordance with its plans and specifications, Landlord shall
construct the portions of the Building in which the Premises are located and
the common areas and facilities providing access thereto, and the same shall be
deemed substantially completed upon certification thereof by Landlord’s
architect. Such construction work (“Shell Work”) to be performed by Landlord to
the Premises is limited to the building shell (as defined by Landlord) and does
not include the finish of Premises to be performed as hereinafter provided in
this Section 4.0. Attached hereto as Exhibit B-2 is a description of
the Shell Work which is subject to such changes as the Landlord may make from
time to time during the pendency of the construction of the Shell Work,
provided that the same docs not materially change the concept of the Building
(the “Base Building Plans”).

 

(A)          Landlord, at Landlord’s sole cost and expense, shall perform the Shell Work
and the work for the preparation of the Premises for Tenant’s occupancy (“Tenant
Improvement Work”) described on Tenant’s final approved plans. The Shell Work
and the Tenant Improvement Work are sometimes referred to collectively as “Landlord’s
Work”. Subject to delays due to governmental regulation, unusual scarcity of or
inability to obtain labor or materials, labor difficulties, casualty or other
causes reasonably beyond Landlord’s control (collectively “Landlord’s Force
Majeure”) or attributable to Tenant’s action or inaction, Landlord shall use
reasonable speed and diligence in the construction of the Landlord’s Work so as
to have the same completed on or before January 1, 2002, but Tenant shall
have no claim against Landlord for failure so to complete construction of
Landlord’s Work, except as expressly set forth in Section 4.1.

 

(B)           The “Substantial Completion Date” shall be defined as the date on
which: (i) the Tenant Improvement Work is substantially complete as
certified by Landlord’s architect, other than Punch List Items, as hereinafter
defined, (ii) Landlord has obtained a certificate of occupancy permitting
Tenant to legally occupy the Premises (except that if Tenant engages its own
contractors to perform any portion of the work to be performed in the initial
preparation of the Premises,

 

13

 

Landlord shall, subject to the provisions of Section 4.4 hereof,
be relieved of its responsibility for obtaining such certificate of occupancy
to the extent that Landlord’s failure to obtain such certificate of occupancy
is based upon any aspect of the work performed by Tenant’s contractors), and (iii) the
Shell Work has been substantially completed as certified by Landlord’s
architect.

 

(C)           If the Substantial Completion Date is delayed by virtue of a Tenant
Delay, as hereinafter defined, the provisions of Section 4.0 F shall apply.

 

(D)          “Punch List Items” shall be defined as those items of work and
adjustment of equipment and fixtures in the Premises, the incompleteness of
which do not cause material interference with Tenant’s use of the Premises, the
Garage, and access to each, and which can be completed after Tenant commences
its occupancy of the Premises without causing material interference with Tenant’s
use of the Premises, the Garage, and access to each. The Punch List Items shall
be set forth in a so-called punch list prepared and signed by Tenant and
Landlord (provided, however, that Landlord shall give Tenant reasonable advance
notice of the time when Landlord intends to walk through the Premises and
compile the punch list, and if Tenant does not accompany Landlord on such
walk-through, Tenant shall be bound by the punch list compiled by Landlord).
The Landlord shall use diligent efforts to complete, as soon as conditions
practically permit, all Punch List Items, and Tenant shall cooperate with
Landlord in providing access during the performance as may be required to
complete such work in a normal manner. Notwithstanding the foregoing, after
Tenant opens for business in the Premises, the completion of all Punch List
Items, other than work which does not materially interfere with Tenant’s use of
the Premises or the Garage, or access thereto, will be performed after the
Building’s business hours, to the extent reasonably possible.

 

(E)           Shell Work shall not be deemed substantially complete until the
following work has been completed:

 

(i)            all portions of the Shell Work necessary to
achieve substantial completion of the Tenant Improvement Work;

 

(ii)           the exterior of the Building shall be substantially
completed and completely enclosed, including windows;

 

(iii)          the items remaining undone in the Building,
and the work necessary to complete them, shall be of such nature as will not
materially interfere with Tenant’s use and occupancy of the Premises or any
part thereof as a first-class business office;

 

14

 

(iv)          the Building lobbies (and the lobby corridors
which enable Tenant to access the elevator bank serving Tenant’s Premises)
shall be substantially completed and access/egress shall be materially
unobstructed from the Huntington Avenue entrance to the elevator banks serving
the Premises. All such areas shall be free of scaffolding and construction
materials;

 

(v)           the exterior of the Building and those
sidewalks of the Building which access the lobby and elevators shall be
substantially free of hoists, sidewalk bridges and construction equipment and
materials insofar as the same would in any manner affect access to the
Premises; and

 

(vi)          at least four (4) elevators (with
finished passenger cabs) in Tenant’s elevator bank and at least one (1) elevator
(with a finished passenger cab) serving the Garage shall be available for
Tenant’s use.

 

Any portion of the Shell Work which is not completed on or before the
Commencement Date shall be completed as soon as conditions practically permit.
Each party shall take necessary reasonable measures to the end that each party’s
contractors shall cooperate in all ways with the other party’s contractors to
avoid any delay to the work being performed by each party’s contractors or
conflict in any other way with the performance of each party’s work.

 

(F)           A “Tenant Delay” shall be defined as any delay in the performance of
Landlord’s Work to the extent that such delay is:

 

(i)            caused by Tenant’s failure to timely comply
with the Plans and Construction Schedule set forth in Exhibit B-4
except where due to Landlord’s delay; or

 

(ii)           due to special work (i.e., long-lead items
(as evidenced by advice from the suppliers, contractors or the like) of which
Landlord advises Tenant in writing at the time that Landlord approves Tenant’s
plans); or

 

(iii)          due to changes, alterations or additions
required or made by Tenant in the layout or finish of the Premises or any part
thereof after Landlord approves Tenant’s plans; or

 

(iv)          caused by delay and/or default on the part of
Tenant or its contractors including, without limitation, the entities
furnishing communications, data processing or other service or equipment,
except to the extent caused by Landlord’s failure to comply with its
obligations under Section 4.4 (ii) hereof.

 

15

 

With respect to any Tenant Delay under this clause (iv), no period of
time prior to the date that Landlord notifies Tenant of a Tenant Delay shall be
considered to be a Tenant Delay.

 

(v)           caused by Tenant or Tenant’s Representatives,
as hereinafter defined, taking any action or failing to take any action which
Tenant is required to take.

 

If
Landlord has complied, as appropriate, with its obligations under Sections 4.2
and 4.3 as of the Authorization to Proceed Date and Tenant fails to give
Landlord a written and unconditional authorization to proceed with the Tenant
Improvement Work on or before the Authorization to Proceed Date set forth on Exhibit B-4,
then each day between the Authorization to Proceed Date and the date that
Tenant gives Landlord such authorization to proceed shall be deemed to be a day
that Landlord is delayed as the result of a Tenant Delay, provided that the
number of days of Tenant Delay pursuant to this sentence shall not exceed the
number of days which Substantial Completion Date occurs after January 1,
2002. Except as set forth in the immediately preceding sentence, Tenant shall
not be responsible for any delays in Landlord’s Work, including the Tenant
Improvement Work, except to the extent that Landlord is delayed solely as the
result of a Tenant Delay. Furthermore, if Tenant delivers full construction
documents to Landlord on or before the Plans Date, as set forth in Exhibit B-4,
then Tenant’s failure to deliver schematic plans on or before the Initial Plans
Submission Date, or failure to deliver design development plans on or before
the Interim Plans Submission Date, both as set forth in Exhibit B-4, shall
not be considered a Tenant Delay.

 

In
the event of a Tenant Delay(s), Tenant shall pay to Landlord, on the last day
of the month in question (but the first such payment shall not be due until the
date on which the Substantial Completion Date would have occurred but for
Tenant Delays), as rent, on a monthly basis in arrears, an amount (“Tenant
Delay Payment”) equal to the Annual Fixed Rent which would have been payable to
Landlord during the length of any Tenant Delays.

 

4.1           TENANT’S TERMINATION RIGHTS AND REMEDIES
BASED ON DELAYS IN LANDLORD’S WORK.

 

(A)          Abandonment of Construction. If Landlord abandons construction of the
Building for a period in excess of ninety (90) days (which period shall be
extended automatically for such periods of time as Landlord is prevented from
proceeding therewith by reason of Landlord’s Force Majeure as defined in Section 4.0)
(“Abandonment Trigger Period”), Tenant shall have the right to terminate this
Lease by giving notice to Landlord of Tenant’s desire to do so within the time
period between the Abandonment Trigger Period and the date when Landlord
resumes construction of the Building; and, if Tenant timely gives such notice,
the Term of the Lease shall cease and come to an end thirty (30) days after Landlord’s

 

16

 

receipt of such notice from Tenant without further liability or
obligation on the part of either party unless, on or before the end of such
thirty (30) day period, Landlord resumes construction of the Building; and such
right of termination shall be Tenant’s sole and exclusive remedy for Landlord’s
abandonment of construction of the Building.

 

(B)           Failure to Achieve Milestones, (i) If Landlord fails to commence
construction of the mid-rise elevators in the Building by November 1, 2000
(which date shall be extended automatically for such periods of time as
Landlord is prevented from proceeding therewith by reason of Landlord’s Force
Majeure or by reason of Tenant Delay) Tenant shall have the right to terminate
this Lease by giving notice to Landlord of Tenant’s desire to do so before
Landlord has commenced construction of the mid-rise elevators; and, if Tenant
timely gives such notice, the Term of the Lease shall cease and come to an end
thirty (30) days after Landlord’s receipt of such notice from Tenant without
further liability or obligation on the part of either party unless, on or
before the end of such thirty (30) days, Landlord commences construction of the
mid-rise elevators; and such right of termination shall be Tenant’s sole and
exclusive remedy for Landlord’s failure to commence construction of the
mid-rise elevators, (ii) if Landlord fails to commence construction of the
high-rise elevators in the Building by March 1, 2001 (which date shall be extended
automatically for such periods of time as Landlord has been prevented from
proceeding therewith by reason of Landlord’s Force Majeure or by reason of
Tenant Delay) Tenant shall have the right to terminate this Lease by giving
notice to Landlord of Tenant’s desire to do so before Landlord has commenced
construction of the high-rise elevators; and, if Tenant timely gives such
notice, the Term of the Lease shall cease and come to an end thirty (30) days
after Landlord’s receipt of such notice from Tenant without further liability
or obligation on the part of either party unless, on or before the end of such
thirty (30) days, Landlord has commenced construction of the high-rise
elevators; and such right of termination shall be Tenant’s sole and exclusive
remedy for Landlord’s failure to commence construction of the high-rise
elevators; or (iii) if Landlord fails to commence construction of the
Tenant Improvement Work by November 1, 2001 (which date shall be extended
automatically for such periods of time as Landlord is prevented from proceeding
therewith by reason of Tenant Delay) then Tenant shall have the right to
terminate this Lease by giving notice to Landlord of Tenant’s desire to do so
before the commencement of such construction; and, if Tenant timely gives such
notice, the Term of the Lease shall cease and come to an end thirty (30) days
after Landlord’s receipt of such notice from Tenant without further liability
or obligation on the part of either party unless, on or before the end of such
thirty (30) day period, Landlord commences such construction; provided, that,
except where the date for such commencement is delayed by Tenant Delay beyond December 15,
2001 the termination shall take effect not later than December 15, 2001 or
the date of receipt by Landlord of Tenant’s notice, whichever shall occur last.
Such right of

 

17

 

termination shall be Tenant’s sole and exclusive remedy for Landlord’s
failure to commence construction of the Tenant Improvement Work.

 

For the purposes of this subparagraph (iii) the construction of
the Tenant Improvement Work shall be considered to be commenced upon
commencement of installation of Tenant mechanical systems in the Premises.

 

(C)           Failure to Achieve Substantial Completion. If the Substantial Completion Date shall
not have occurred on or before October 1, 2002 (“Outside Completion Date”)
(which date shall be extended for any act or failure to act of Tenant which interferes
with Landlord’s Work, without limiting Landlord’s other rights on account
thereof), Tenant shall have the right to terminate this Lease by giving notice
to Landlord of Tenant’s desire to do so before such completion and within the
time period from the Outside Completion Date (as so extended) until the date which
is thirty (30) days subsequent to the Outside Completion Date (as so extended);
and, upon the giving of such notice, the Term of this Lease shall cease and
come to an end without further liability or obligation on the part of either party
unless, within thirty (30) days after receipt of such notice, the Substantial Completion
Date occurs. Each day of Tenant Delay shall be deemed conclusively to cause an
equivalent day of delay by Landlord in substantially completing Landlord’s
Work, and thereby automatically extend for each such equivalent day of delay
the date of the Outside Completion Date. Such right of termination shall be
Tenant’s sole and exclusive remedy for Landlord’s failure to complete Landlord’s
Work.

 

(D)          Landlord’s Termination Rights for Force
Majeure and Tenant Delay. If
the Substantial Completion Date has not occurred by December 1, 2002 due
to Landlord’s Force Majeure as defined in Section 4.0 or one or more
Tenant Delays, then Landlord, without limiting Landlord’s other rights on
account thereof, shall have the right to terminate this Lease by giving notice
to Tenant of Landlord’s desire to do so; and, upon the giving of such notice,
the Term of this Lease shall cease and come to an end without further liability
or obligation on the part of either party.

 

4.2           PLANS

 

(A)          Planning Process. Tenant shall, promptly after this Lease is
executed by Tenant and Landlord and delivered, submit to Landlord for Landlord’s
approval an initial set of plans (“Initial Plans”), progress plans from time to
time (“Interim Plans”) and a full set of construction drawings (“Final Plans”)
for Tenant Improvement Work (collectively “the Plans”).  Tenant’s architect therefor is Design
Management Corporation. The Plans shall contain at least the information
required by, and shall conform to the requirements of, Exhibit B-2.
Landlord’s approval of the Initial Plans and the Interim Plans (and the Final
Plans, provided

 

18

 

that the Final Plans are consistent with the Initial Plans and the
Interim Plans and contain at least the information required by, and conform to
the requirements of, said Exhibit B-2), shall not be unreasonably
withheld, conditioned or delayed and shall comply with the requirements to avoid
aesthetic or other conflicts with the design and function of the balance of the
Building. Landlord’s approval is solely given for the benefit of Landlord under
this Section 4.2 and neither Tenant nor any third party shall have the
right to rely upon Landlord’s approval of Tenant’s plans for any other purpose
whatsoever. Without limiting the foregoing, Tenant shall be responsible for all
elements of the design of Tenant’s plans (including, without limitation,
compliance with law, functionality of design, the structural integrity of the
design, the configuration of the Premises and the placement of Tenant’s
furniture, appliances and equipment), and Landlord’s approval of Tenant’s plans
shall in no event relieve Tenant of the responsibility for such design. Landlord
agrees to respond to any Initial Plans within thirty days (30) of receipt
thereof and to Interim Plans and the Final Plans within fourteen (14) days of
receipt thereof. If Landlord fails to timely respond then for each day of such
failure, there shall be a corresponding day for day delay in the time periods
under Exhibit B-4 to the extent applicable. If Landlord disapproves of any
Plans, then Tenant shall, within ten (10) days of receipt of such
disapproval, have the Plans revised by its architect to incorporate all
reasonable objections and conditions presented by Landlord and resubmitted to
Landlord (provided, however, that Tenant shall have fourteen (14) days to
resubmit the Plans in the case a major redesign is required as the result of
such disapproval). Such process shall be followed until the Plans shall have
been approved by the Landlord without objection or condition. Landlord shall
respond to the resubmission of any Plans by Tenant within five (5) days of
Landlord’s receipt thereof (or fourteen (14) days in the case of a major
redesign). Tenant shall prepare the Plans within the time frames set forth in
the Plans and Construction Schedule attached hereto as

Exhibit B-4. If no time period is specified in Exhibit B-4 or
elsewhere in this Article IV for any action which must be taken by Tenant
in connection with the approval of the Plans or the performance of the Tenant
Improvement Work, Tenant shall be required to take such action within ten (10) business
days after Tenant receives a written request to take such action. Time is of
the essence of Tenant’s obligation to prepare the Plans in accordance with
Plans and Construction Schedule, except to the extent that Tenant is delayed by
Landlord’s failure to act in a timely manner in accordance with this Paragraph
(A).

 

4.3           PERFORMANCE OF LANDLORD’S WORK; COST OF
TENANT IMPROVEMENT WORK AND OF LANDLORD’S BASE BUILDING WORK

 

(A)          Landlord shall engage a contractor (“General Contractor”) as the
general contractor to perform the Landlord’s Work under a contract (the “TI
Contract”). Landlord shall use J.P. Moriarty (“Moriarty”) as the General
Contractor but may

 

19

 

use another entity as the General Contractor if Moriarty is not the
general contractor for the Building.

 

(B)           In determining the cost of the Tenant Improvement Work to be paid by Tenant
(if any) pursuant to Paragraph (H) of this Section 4.3, any savings accruing
to the Landlord under the TI Contract shall reduce the cost of the Tenant Improvement
Work to be paid by Tenant. The General Contractor shall be required to submit
separate certificates for payment under the TI Contract from the certificates
for payment which it submits to Landlord in connection with the Shell Work.

 

(C)           Landlord shall receive no construction management fee in connection
with the performance of the Tenant Improvement Work.

 

(D)          Following Landlord’s approval of the Final Plans, Landlord shall cause
the General Contractor to obtain at least three (3) subcontractor bids for
each trade in connection with the Tenant Improvement Work. Tenant shall have
the right to propose one subcontractor for each trade for the Tenant
Improvement Work and to consult with Landlord and the General Contractor
regarding the preparation of the bid packages. 
All subcontractors shall be subject to Landlord’s prior consent, which
consent shall not be unreasonably withheld, conditioned or delayed. Landlord’s
General Contractor may bid on portions of the Tenant Improvement Work that
would be performed by a subcontractor, such as rough carpentry. Landlord shall
prepare an analysis of such bids and recommendations for Tenant’s review.
Landlord and Tenant shall prequalify each subcontractor for each trade on the
bid list. The bid packages shall require bids to identify all long lead items and
to specify delivery dates therefor. Landlord’s General Contractor under the direction
of Landlord will solicit the bids from the subcontractors and administer the
bid solicitation process consistent with the time periods provided for in Exhibit B-4.
Upon the conclusion of the bid solicitation process, Landlord will provide
Tenant with a copy of the bids received from the subcontractors, including an
analysis of such bids and recommendations for Tenant’s review, and meet with
Tenant to determine which of the subcontractors shall be awarded the subcontract
for each major trade within the Tenant Improvement Work. Tenant shall
reasonably cooperate with Landlord’s efforts to expedite the bid process. After
Landlord’s receipt of bids for the Tenant Improvement Work, Tenant shall have
the right, in accordance with the Plans and Construction Schedule set
forth on Exhibit B-4, to select the subcontractor in each trade from the
prequalified list for the Tenant Improvement Work.

 

(E)           Cost Proposal. Landlord shall advise Tenant of preliminary
price estimates (including breakdowns by trade) as promptly as possible but in
any event within the following time periods: (i) ten (10) business
days after Landlord’s receipt of the Initial Plans, (ii) fifteen (15)
business days after

 

20

 

Landlord’s receipt of the Interim Plans, and (iii) within twenty
(20) business days after Landlord’s receipt of the Final Plans, After Landlord
and Tenant meet to evaluate the results of the bid solicitation process,
Landlord shall calculate and furnish to Tenant a “Cost Proposal” which shall
constitute the aggregate of (i) the amounts payable under the subcontracts
selected (and, subject to Section 4.3D above, where the General Contractor
is performing work that would be performed by a subcontractor, the cost of such
work) in the bid process and to be let upon approval of the Cost Proposal,
broken down by trade (“Direct Costs”), and (ii) the amount of the General
Contractor’s fee and general conditions based on the Direct Costs. The
components of the Cost Proposal shall (subject to Change Orders) be fixed at
the rates set forth therein.

 

(F)           Tenant Approval of Cost Proposal; Redesign
Period. Tenant shall approve
or reject the Cost Proposal in writing to Landlord on or before the later to
occur of (i) ten business days after being furnished the same, or (ii) the
Authorization to Proceed Date set forth on Exhibit B-4. If Tenant fails to
give Landlord notice approving of the Cost Proposal within the period required
under the preceding sentence, Tenant shall be deemed to have rejected the Cost
Proposal. If Tenant rejects or is deemed to have rejected the Cost Proposal, (i) no
Tenant Improvement Work will commence until a Cost Proposal, has been approved
by Tenant, and (ii) within fifteen (15) business days after the expiration
of Tenant’s response period under the first sentence of this Section 4.3F,
Tenant shall make such revisions to the Final Plans as Tenant desires to make to
change the cost of the Tenant Improvement Work and resubmit the same to
Landlord for approval pursuant to the process set forth in Section 4.2
above. In such event, Landlord shall direct Landlord’s contractor to re-price
the Tenant Improvement Work based upon the revised Final Plans and shall submit
a revised Cost Proposal to Tenant within ten (10) business days (or
twenty-one (21) business days in the case of a major redesign) after receipt of
revised Final Plans. Tenant shall give Landlord written notice accepting or
rejecting the revised Cost Proposal on or before the later of (x) five (5) business
days after Tenant’s receipt thereof or (y) the Authorization to Proceed Date,
and failure to give such notice within such period shall be deemed a rejection
thereof.  In any event, the cost of any
change in or cancellation of any long lead time items after the Long Lead Time
Release Date (as set forth on Exhibit B-4) shall be Tenant’s
responsibility; and Tenant’s failure, on or before the Authorization to Proceed
Date, to approve a Cost Proposal acceptable to Landlord and to authorize, in
writing, Landlord to commence the performance of the Tenant Improvement Work
shall be deemed to be a Tenant Delay, except to the extent that such failure is
based upon Landlord’s failure to timely satisfy its obligations under either Section 4.2A
or Section 4.3F.

 

(G)           Change Orders. Tenant shall have the right, in accordance
herewith, to submit for Landlord’s approval (which shall not be unreasonably
withheld) change proposals subsequent to Landlord’s approval of the Final Plans
and

 

21

 

Tenant’s approval of the Cost Proposal (each, a “Change Order”),
Landlord agrees to respond to any such change proposal (which response shall
include any information necessary for Tenant to evaluate such change order)
within such time as is reasonably necessary (taking into consideration the
information contained in such change proposal) after the submission thereof by
Tenant, advising Tenant of any anticipated costs (“Change Order Costs”)
associated with such change proposal, as well as an estimate of any delay which
would likely result in the completion of the Tenant Improvement Work if a
Change Order is made pursuant thereto. Tenant shall have the right to then
approve or withdraw such change proposal within five (5) business days
after receipt of such information. If Tenant approves such change proposal and
a Change Order is made, then the Change Order Costs associated with the
approved change order shall be deemed additions to the Cost Proposal.

 

(H)          Landlord’s Shell Work shall, subject to Paragraph B of Section 4.2,
be performed by Landlord at Landlord’s expense. In addition, in the event that
the cost of Landlord’s Shell Work is increased as the result of any Tenant
Delays, Tenant shall, within thirty (30) days of billing therefor, pay to
Landlord, as Additional Rent, the cost of any such increase. Landlord shall
give notice to Tenant that Landlord anticipates that a Tenant Delay will
increase the cost of Landlord’s Shell Work as soon as reasonably possible after
Landlord has identified that such delay will cause such increase even though
the amount of such increase has not been identified.

 

(I)            The Tenant Improvement Work shall, subject to
the Special Allowance (as defined in Section 5.3), if applicable, be
performed by Landlord at Tenant’s sole cost and expense. If the cost of the
Tenant Improvement Work exceeds the Special Allowance, if applicable, then
Tenant shall pay to Landlord the amount of such excess. No payments on account
of the Tenant Improvement Work shall be due from Tenant until the Special
Allowance has first been exhausted. Any payments due from Tenant on account of
the Tenant Improvement Work shall be due and payable, as Additional Rent,
within thirty (30) days of billing therefor. Landlord may bill Tenant for such
excess costs on a monthly basis as Landlord incurs such costs after Landlord
has exhausted the Special Allowance.

 

(J)            Tenant acknowledges and agrees that Tenant’s
Representatives shall have full power and authority to act on behalf of Tenant
and any action taken by Tenant’s Representatives shall be fully binding upon
Tenant.

 

4.4           HOLDOVER DAMAGES. If Landlord shall have failed substantially
to complete the work in the Premises described in the Plans on or before February 1,
2002 (which date shall be extended automatically for such periods of time as
Landlord is prevented from proceeding with or completing the same by reason of
any act or failure to act of Tenant which interferes with Landlord’s
construction of

 

22

 

the Premises, without limiting Landlord’s other rights on account
thereof), Landlord shall, in the manner hereinafter set forth, reimburse Tenant
up to $641,773.32 (“Landlord’s Holdover Payment”) towards Tenant’s Holdover
Damages, as hereinafter defined, incurred by Tenant during the period (“Holdover
Period”) from February 1, 2002 until the Commencement Date. For the
purposes hereof, “Tenant’s Holdover Damages” shall be equal to the Holdover
Premium, as hereinafter defined, payable by Tenant to its Existing Landlord, as
hereinafter defined, during the Holdover Period. For the purposes hereof, the “Holdover
Premium” shall mean, subject to the following limitation, all amounts payable
by Tenant to the Existing Landlord on account of rent, use or occupancy of
Tenant’s Existing Premises at One Financial Center, Boston, MA (“Existing
Premises”) during the Holdover Period, less the amount of rent which would have
been payable by Tenant to the Existing Landlord for the Holdover Period had the
rent payable during the Holdover Period equaled the amount of rent and other
charges payable by Tenant under its existing lease dated 11/8/84, as amended (“Existing
Lease”) by and between Dewey Square Tower Associates, as landlord (“Existing
Landlord”) and Tenant, as tenant, in effect immediately preceding the
termination of the Existing Lease; provided, however, that the Holdover Premium
shall not exceed the sum of the square footage of the Existing Premises in
which Tenant holds over during the Holdover Period multiplied by $.0548 per
diem per square foot of holdover. Tenant may invoice Landlord for landlord’s
Holdover Payment monthly as the same is incurred by Tenant and Landlord shall
pay the Landlord’s Holdover Payment to Tenant within thirty (30) days after
receipt of an invoice therefor provided that no default of Tenant, beyond the
expiration of applicable notice and/or cure periods, then exists. Such payment
of Tenant’s Holdover Damages up to Landlord’s Holdover Payment shall be Tenant’s
sole and exclusive remedy for Landlord’s failure so to complete such work
within such time. Each day of Tenant Delay shall be deemed conclusively to
cause an equivalent day of delay by Landlord in substantially completing the
work to be done by Landlord pursuant to Section 4.1, and thereby
automatically extend for each such equivalent day of delay the date of the
Outside Completion Date.

 

4.5           QUALITY AND PERFORMANCE OF WORK. All construction work required or permitted
by this Lease shall be done in a good and workmanlike manner and in compliance
with all applicable laws, ordinances, rules, regulations, statutes, bylaws,
court decisions, and orders and requirements of all public authorities (“Legal
Requirements”) and all Insurance Requirements (as defined in Section 9.1
hereof). All of Tenant’s work shall be coordinated with any work being
performed by or for Landlord and in such manner as to maintain harmonious labor
relations. Each party may inspect the work of the other at reasonable times and
shall promptly give notice of observed defects. Each party authorizes the other
to rely in connection with design and construction upon approval and other
actions on the party’s behalf by any Construction Representative of the party
named in Section 1.2 or any person hereafter designated in substitution or
addition by notice

 

23

 

to the party relying. Except to the extent to which Tenant shall have
given Landlord notice of respects in which Landlord has not performed Landlord’s
construction obligations under this Article IV no later than eleven months
after the Commencement Date Tenant shall be deemed conclusively to have
approved Landlord’s construction and shall have no claim that Landlord has
failed to perform any of Landlord’s obligations under this Article IV.
Landlord agrees to correct or repair at its expense items which are then
incomplete or do not conform to the work contemplated under the Plans and as to
which, in either case, Tenant shall have given notice to Landlord, as
aforesaid.

 

ARTICLE V

ANNUAL FIXED RENT AND ELECTRICITY AND SPECIAL ALLOWANCES

 

5.1           FIXED RENT. Tenant agrees to pay to Landlord, or as directed by Landlord at such
place as Landlord shall from time to time designate by notice (1) on the
Commencement Date, and thereafter monthly, in advance, on the first day of each
and every calendar month during the Original Lease Term, a sum equal to
one-twelfth (1/12) of the Annual Fixed Rent specified in Section 1.2 and (2) on
the first day of each and every calendar month during each Extended Term (if
exercised), a sum equal to one-twelfth of the Annual Fixed Rent as determined
in Section 3.2 for the applicable Extended Term. Until notice of some other
designation is given, Annual Fixed Rent and all other charges for which
provision is herein made shall be paid by remittance to or to the order of
BOSTON PROPERTIES LIMITED PARTNERSHIP, Agents at P.O. Box 3557, Boston,
Massachusetts 02241-3557, and all remittances received by BOSTON PROPERTIES
LIMITED PARTNERSHIP, as Agents as aforesaid, or by any subsequently designated
recipient, shall be treated as a payment to Landlord.

 

Annual Fixed Rent for any partial month shall be paid by Tenant to
Landlord at such rate on a pro data basis, and, if the Commencement Date shall
be other than the first day of a calendar month, the first payment of Annual
Fixed Rent which Tenant shall make to Landlord shall be a payment equal to a
proportionate part of such monthly Annual Fixed Rent for the partial month from
the Commencement Date to the first day of the succeeding calendar month.

 

Additional Rent payable by Tenant on a monthly basis, as elsewhere
provided in this Lease, likewise shall be prorated, and the first payment on
account thereof shall be determined in similar fashion and shall commence on
the Commencement Date and other provisions of this Lease calling for monthly
payments shall be read as incorporating this undertaking by Tenant.

 

The Annual Fixed Rent and all other charges for which provision is made
in this Lease shall be paid by Tenant to Landlord without setoff, deduction or
abatement.

 

24

 

5.2           ALLOCATION OF ELECTRICITY CHARGES. Landlord shall reallocate the cost of
electricity to tenants of the Building (including, but not limited to, Tenant herein)
in accordance with the procedure contained in Exhibit F, and Tenant shall pay
for electricity as provided in said Exhibit F.

 

5.3           SPECIAL ALLOWANCE. Landlord shall provide Tenant with a
special allowance (“Special Allowance”) in the amount of Three Million Thirty
Eight Thousand Seven Hundred and 00/100 ($3,038,700.00) Dollars (i.e., $50.00
per square foot of Rentable Floor Area of the Premises) to be applied against
the costs of the Tenant Improvement Work (the “Tenant Costs”). In the event
that the Tenant Costs are less than the Special Allowance, Tenant shall be
entitled to use up to $607,740.00 of the Special Allowance (i.e., $10.00 per
square foot of Rentable Floor Area of the Premises) toward costs incurred by
Tenant in connection with installing cabling in the Premises, towards furniture
to be used in the Premises, and towards moving expenses (the “Move-In Allowance”).
Landlord shall reimburse such costs within thirty (30) days of Landlord’s
receipt of approved invoices from Tenant evidencing such costs. Any Allowance remaining
shall, at Landlord’s election, be paid to Tenant as a cash payment or be applied
as a credit against Annual Fixed Rent and Additional Rent owed by Tenant under
this Lease. Landlord shall not be entitled to deduct from the Special Allowance
any construction management fee for Landlord’s oversight of the Landlord Work.

 

5.4           PLANS ALLOWANCE. Landlord shall contribute up to One Hundred
Eighty- Two Thousand Three Hundred Twenty-Two and 00/100 ($ 182,322.00) Dollars
(i.e., $3.00 per square foot of Rentable Area of the Premises) (“Plans
Allowance”) towards the costs incurred by Tenant in preparing the Plans.
Landlord shall pay the Plans Allowance to Tenant’s architect within thirty (30)
days of receipt of approved invoices from Tenant evidencing such costs. Tenant
shall not be entitled to any unused portion of the Plans Allowance.

 

5.5           MOVING ALLOWANCE. Landlord shall contribute up to One Hundred
Twenty One Thousand Five Hundred Forty Eight and 00/100 ($121,548.00) Dollars
(i.e., $2.00 per square foot of Rentable Floor Area of the Premises) (“Moving Allowance”)
towards the costs incurred by Tenant in moving to the Premises. Landlord shall
pay the Moving Allowance to Tenant’s moving company within thirty (30) days of
receipt of approved invoices from Tenant evidencing such costs. Tenant shall
not be entitled to any unused portion of the Moving Allowance.

 

25

 

ARTICLE VI

TAXES AND OPERATING EXPENSES

 

6.1           DEFINITIONS. With reference to the real estate taxes and Operating Expenses referred
to in this Article VI, it is agreed that terms used herein are defined as
follows:

 

(a)           “Tax Year” means the 12-month period
beginning July 1 each year during the Lease Term or if the appropriate
Governmental tax fiscal period shall begin on any date other than July 1,
such other date.

 

(b)           Omitted.

 

(c)           “Landlord’s Tax Expenses” with respect to any
Tax Year means the aggregate “real estate taxes” (hereinafter defined) with
respect to that Tax Year, reduced by any net abatement receipts with respect to
that Tax Year; provided, however, that if in any Tax Year an abatement has been
obtained on account of vacancies in the Building, or if the real estate taxes
had initially been assessed in an amount to reflect such vacancies then Landlord’s
Tax Expenses shall be determined to be an amount equal to the taxes which would
normally be expected to have been assessed had occupancy been ninety-five
percent (95%) as of the reference date or period on which or in relation to
which such assessment was made. For this purpose, taxes on properties
comparable to the Building may be used as a reference if such properties were
occupied at ninety-five percent (95%) more or less during the relevant period.

 

(d)           “Real estate taxes” means all taxes and
special assessments of every kind and nature and user fees and other like fees
assessed by any Governmental authority on, or, subject to the provisions of
this paragraph (d) allocable to, (i) the Building, (ii) the
Overlease Premises, or (iii) the land, open areas, public areas and
amenities, plazas, common areas and other non-leasable areas of the Prudential
Center (for the purposes of this subsection (d) ”Tax Common Areas”),
which the Landlord shall be obligated to pay under the Overlease or because of
or in connection with the ownership, leasing or operation of the Building or
Overlease Premises and reasonable expenses of any proceedings for abatement of
taxes. The Overlease provides that: (i) if the Overlease Premises are
separately assessed from other portions of the Prudential Center for real
estate tax purposes, then real estate taxes shall mean such taxes as so
separately assessed together with the share allocable to the Overlease Premises
of real estate taxes on the Tax Common Areas as determined in accordance with
the Overlease; and (ii) if the Overlease Premises are not so separately
assessed, the Overlease provides a mechanism for the allocation of the real
estate taxes to be paid by Landlord under the Overlease in respect of the
Building, the Overlease Premises and the Tax Common Areas. In either case, the
real estate taxes allocable to the Garage shall be excluded from such real
estate taxes for

 

26

 

the purposes of this Lease, and if the portions of the Garage within
the Overlease Premises are not separately assessed for real estate taxes from
the remainder of the Overlease Premises, then the real estate taxes allocable
to the Garage to be so excluded shall be determined in accordance with the
terms of the Overlease and such determination shall be binding on Tenant. The
amount of special taxes or special assessments to be included shall be limited
to the amount of the installment (plus any interest other than penalty interest
payable thereon) of such special tax or special assessment required to be paid
during the year in respect of which such taxes are being determined. There
shall be excluded from such taxes all income, estate, succession, inheritance
and transfer taxes; provided, however, that if at any time during the Lease
Term the present system of ad valorem taxation of real property shall be
changed so that in lieu of, or in addition to, the whole or any part of the ad
valorem tax on real property, there shall be assessed on Landlord a capital
levy or other tax on the gross rents received with respect to the Building or
Overlease Premises, or a Federal, State, County, Municipal, or other local
income, franchise, excise or similar tax, assessment, levy or charge (distinct
from any now in effect in the jurisdiction in which the Prudential Center is
located) measured by or based, in whole or in part, upon any such gross, rents,
then any and all of such taxes, assessments, levies or charges, to the extent
so measured or based, shall be deemed to be included within the term “real
estate taxes” but only to the extent that the same would be payable if the
Building, were the only property of Landlord. For the purposes of this Lease,
real estate taxes shall include any payment in lieu of taxes or any payments
made under Chapter 121A of the Massachusetts General Laws or any similar law.
The parties acknowledge that Landlord is presently negotiating with the Tax
Assessor of the City of Boston so that, as of the Commencement Date, the Tax
Assessor shall, with respect to each fiscal/tax period issue a single real
estate tax bill which will include all real estate taxes imposed by the City of
Boston relating to both the Building and the Overlease Premises, and Landlord
shall hereafter use reasonable and diligent efforts to achieve the same.
However, to the extent that the Building is not separately assessed for real
estate tax purposes, but is assessed as part of a larger parcel, then the
Landlord shall make a reasonable allocation as to the amount of the real estate
taxes (i.e. so far as such taxes are imposed on the land of the Prudential
Center and the open areas, public areas and amenities, plazas, common areas and
other non-leasable areas of the Prudential Center) that shall be allocated to
the Building for the purposes of determination of the Tenant’s share of
increases in real estate taxes under this Lease.

 

6.2           OPERATING COSTS DEFINED. “Operating Expenses Allocable to the
Premises” means the same proportion of the Operating Expenses for the Building

 

27

 

(as hereinafter defined) as Rentable Floor Area of the Premises bears
to 95% of the Total Rentable Floor Area of the Office Portion of the Building. “Base
Operating Expenses Allocable to the Premises” means the product of $15.00
multiplied by the Rentable Floor Area of the Building. “Operating Expenses for
the Building” means the cost of operation of the Building and the Building’s
share of the cost of operating other areas of the Prudential Center as more
specifically provided below in this Section 6.2, including those incurred
in discharging the obligations under Section 7.2 and 7.3 and also includes
Landlord’s Tax Expenses (as hereinbefore defined); however there shall be
excluded from the Operating Expenses for the Building the cost of operation of
the Garage and Operating Expenses Allocable to the Retail Portion of the
Building, as hereinafter defined. In addition, such costs shall exclude
payments of debt service and any other mortgage charges, brokerage commissions,
salaries of executives and owners not directly employed in the management or
operation of the Building, the general overhead and administrative expenses of
the home office of Landlord or Landlord’s managing agent or of Overlandlord or
Overlandlord’s managing agent, and costs of special services rendered to
tenants (including Tenant) for which a separate charge is made, but shall
include, without limitation:

 

(a)           compensation, wages and all fringe benefits,
workmen’s compensation insurance premiums and payroll taxes paid to, for or
with respect to all persons for their services in the operating, maintaining,
managing, insuring or cleaning of the Building or, as allocated under clause (i) below,
the Operating Common Areas;

 

(b)           payments under service contracts with
independent contractors for operating, maintaining or cleaning of the Building
or, as allocated under clause (i) below, the Operating Common Areas;

 

(c)           steam, water, sewer, gas, oil, electricity
and telephone charges (excluding such utility charges separately chargeable to
tenants for additional or separate services and electricity charges paid by
Tenant in the manner set forth in Section 5.2) and costs of maintaining
letters of credit or other security as may be required by utility companies as
a condition of providing such services;

 

(d)           cost of maintenance, cleaning and repairs and
replacements(other than repairs reimbursed from contractors under guarantees);

 

(e)           cost of snow removal and care of landscaping;

 

(f)            cost of building and cleaning supplies and
equipment;

 

28

 

(g)           premiums for insurance carried with respect
to the Building or, as allocated under clause (i) below, the Operating
Common Areas (including, without limitation, liability insurance, insurance
against loss in case of fire or casualty and of monthly installments of Annual
Fixed Rent and any Additional Rent which may be due under this Lease and other
leases of space in the Building for not more than twelve (12) months in the
case of both Annual Fixed Rent and Additional Rent and, if there be any first
mortgage on the Building, including such insurance as may be required by the
holder of such first mortgage);

 

(h)           management fees at reasonable rates
consistent with the type of occupancy and the services rendered;

 

(i)            the cost of operating, maintaining, cleaning
and insuring the open areas, public areas and amenities, plazas, common areas,
common facilities and other non-leasable areas of the Prudential Center that
are used in common by tenants of the Prudential Center (“Operating Common Areas”)
and other Mixed Use Common Area Maintenance Costs, as defined in the Overlease,
under the Overlease incurred by Overlandlord, Landlord or any other PruOwner
and allocated to the Building or Overlease Premises under the Overlease, and
any shuttle buses for the use by tenants of the Building either alone or in
common with tenants of other buildings in the Prudential Center (but see
subparagraph (v) below for limitations on the inclusion of subsidies for
amenities). For the purposes of this Section 6.2, the Operating Common
Areas of the Prudential Center shall not include the Arcades and Exterior
Common Areas, as defined in the Overlease, the lobbies within any building now
or hereafter located at the Prudential Center or the Garage;

 

(j)            depreciation for capital improvements (x) to
reduce Operating Expenses if Landlord reasonably shall have determined that the
annual reduction in Operating Expenses shall exceed depreciation therefor or
(y) to comply with Legal Requirements (plus, in the case of both (x) and (y),
an interest factor, reasonably determined by Landlord, as being the interest rate
then charged for long term mortgages by institutional lenders on like
properties within the general locality in which the Building is located), and
in the case of both (x) and (y) depreciation shall be determined by dividing
the original cost of such capital expenditure by the number of years of useful
life of the capital item acquired, which useful life shall be determined
reasonably by Landlord in accordance with generally accepted accounting
principles and practices in effect at the time of acquisition of the capital
item; provided, however, if Landlord reasonably concludes on the basis of
engineering estimates that a particular capital expenditure will effect savings
in other Operating Expenses, including, without limitation, energy

 

29

 

related costs, and that such projected savings will, on an annual basis
(“Projected Annual Savings”), exceed the annual depreciation therefor, then and
in such event the amount of depreciation for such capital expenditure shall be
increased to an amount equal to the Projected Annual Savings; and in such
circumstance, the increased depreciation (in the amount of the Projected Annual
Savings) shall be made for such period of time as it would take to fully
amortize the cost of the item in question, together with interest thereon at
the interest rate as aforesaid in equal monthly payments, each in the amount of
l/l2th of the Projected Annual Savings, with such payment to be applied first
to interest and the balance to principal (such depreciation being hereinafter
referred to as the “Permitted Depreciation”);

 

(k)           Landlord’s Tax Expenses, as defined in Section 6.l(c) (the
parties hereby acknowledging that Landlord’s Tax Expenses for each calendar
year shall include the actual amount of Landlord’s Tax Expenses for the Tax
Periods included in such calendar year); and

 

(I)            all other reasonable and necessary expenses
paid in connection with the operating, cleaning and maintenance of the
Building, Overlease Premises, or as allocated under clause (i) above, the
Operating Common Areas and properly chargeable against income.

 

Notwithstanding the foregoing, the following shall be excluded from
Operating Expenses for the Building:

 

(i)            The costs of the initial construction of the
Building, and any repair costs in connection with latent defects in the
Building (including any failure of the Building to comply with laws which are
in effect as of the Commencement Date which are incurred by Landlord prior to
the fifth (5th) anniversary of said Commencement Date and repair
costs in connection with other buildings in the Prudential Center and any costs
of a capital nature incurred before such fifth (5th) anniversary
date except where required to comply with law enacted subsequent to the
Commencement Date;

 

(ii)           All capital expenditures and depreciation,
except as otherwise explicitly provided in this Section 6.2;

 

(iii)          Leasing fees or commissions, advertising and
promotional expenses, legal fees, the cost of tenant improvements, build out
allowances, moving expenses, assumption of rent under existing leases and other
concessions incurred in connection with leasing space in the Building or in
Prudential Center;

 

30

 

(iv)          Interest on indebtedness, debt amortization,
ground rent, and refinancing costs for any mortgage or ground lease of the
Building or the Prudential Center, provided however, that the foregoing shall
not exclude the inclusion of the amortization and interest permitted to be
included in Operating Expenses on account of capital improvements under Section 6.2(j)
above;

 

(v)           Legal, auditing, consulting and professional
fees and other costs, (other than those legal, auditing, consulting and
professional fees and other costs incurred in connection with the normal and
routine maintenance and operation of the Building and/or the Operating Common
Areas of Prudential Center), including, without limitation, those: (i) paid
or incurred in connection with financings, refinancings or sales of any
Landlord’s interest in the Building or the Prudential Center, (ii) relating
to specific disputes with tenants, and (iii) relating to any special
reporting required by securities laws

 

(vi)          Costs incurred in performing work or
furnishing services for any tenant (including Tenant), whether at such tenant’s
or Landlord’s expense, to the extent that such work or services is in excess of
any work or service that Landlord is obligated to furnish to Tenant at Landlord’s
expense (e.g., if Landlord agrees to provide extra cleaning to another tenant,
the cost thereof would be excluded since Landlord is not obligated to furnish
extra cleaning to Tenant);

 

(vii)         The cost of any item or service to the extent
reimbursed or reimbursable to Landlord by insurance required to be maintained
under the Lease, by any tenant, or by any third party, such as the cost of
supplying electricity for plugs and lights in a tenant’s premises;

 

(viii)     The cost of repairs or replacements incurred
by reason of fire or other casualty or condemnation other than costs not in
excess of a reasonable deductible on any insurance maintained by Landlord which
provides a recovery for such repair or replacement;

 

(ix)      Insurance premiums to the extent any tenant
causes Landlord’s existing insurance premiums to increase or requires Landlord
to purchase additional insurance because of such tenant’s use of the Building
for other than office purposes;

 

(x)       Any advertising, promotional or marketing
expenses for the Buildings or the Prudential Center;

 

31

 

(xi)      The cost of any service or materials provided
by any party related to Landlord, to the extent such costs exceed the
reasonable cost for such service or materials absent such relationship in
buildings similar to the Building in the vicinity of the Building;

 

(xii)          Payments for rented equipment, the cost of
which equipment would constitute a capital expenditure if the equipment were
purchased to the extent that such payments exceed the amount which could have
been included in Operating Expenses had Landlord purchased such equipment
rather than leasing such equipment;

 

(xiii)     Penalties, damages, and interest for late
payment or violations of any obligations of Landlord, including, without
limitation, taxes, insurance, equipment leases and other past due amounts;

 

(xiv)     Contributions to charitable organizations;

 

(xv)      Costs incurred in removing the property of
former tenants or other occupants of the Building;

 

(xvi)     The cost of testing, remediation or removal
of “Hazardous Materials” (as defined in Section 11.2) in the Building or
on the Prudential Center required by “Hazardous Materials Laws” (as defined in Section 11.2),
provided however, that with respect to the testing, remediation or removal of
any material or substance which, as of the Commencement Date, was not
considered, as a matter of law, to be a Hazardous Material, but which is
subsequently determined to be a Hazardous Material as a matter of law, the
costs thereof shall be included in Operating Expenses, subject, however, to Section 6.2(j)
to the extent that such cost is treated as a capital expenditure.

 

(xvii)    The cost of acquiring, installing, moving or
restoring objects of art;

 

(xviii)      Wages, salaries, or other compensation paid
to any executive employees above the grade of general manager at the Prudential
Center, except that if any such employee performs a service which would have
been performed by an outside consultant, the compensation paid to such employee
for performing such service shall be included in Operating Expenses, to the
extent only that the cost of such service does not exceed competitive cost of
such service had such service been rendered by an outside consultant;

 

(xix)     Operating Costs for the Garage, the retail
portions of the Prudential Center (other than as expressly provided above), or
any building now or hereafter

 

32

 

located at the Prudential Center (other than the Building and the
Operating Common Areas of the Prudential Center, as set forth above);

 

(xx)          The net (i.e. net of the reasonable costs of
collection) amount recovered by Landlord under any warranty or service
agreement from any contractor or service provider shall be credited against
Operating Costs;

 

(xxi)       The cost of installation of, space
preparation for, and rent applicable to any amenities of the Prudential Center
(the parties hereby agreeing that this clause (xxi) shall not be deemed to
exclude the coat of subsidizing the operation of those amenities of the
Prudential Center that are not businesses, a health club being an example of
such an amenity);

 

(xxii)        Cost or expenses due to the willful
misconduct or gross negligence of Landlord;

 

(xxiii)       Bad debt expenses;

 

(xxiv)     Payments to any affiliate of Tenant which
exceed the amount which would have been paid had the service been provided by,
a non-affiliated party;

 

(xxv)        General corporate overhead expenses and
general administrative expenses; or

 

(xxvi)       Cost of correcting violation of laws
currently in effect.

 

Gross-Up Provision. Notwithstanding the foregoing, in determining
the amount of Operating Expenses for the Building for any calendar year or
portion thereof falling within the Lease Term, or the Base Operating Expenses
applicable to any Expansion Area, if less than ninety-five percent (95%) of the
Rentable Area of the Building shall have been occupied by tenants at any time
during the period in question, then, at Landlord’s election, Operating Expenses
(excluding Landlord’s Tax Expenses) which vary according to occupancy for such
period shall be adjusted to equal the amount that such Operating Expenses would
have been for such period had occupancy been ninety-five percent (95%)
throughout such period.

 

“Operating Expenses Allocable to the Retail Portion of the Building”
means:

 

(a)           all costs related to the operation, cleaning
and maintenance of the Retail Portion of the Building, including, without
limitation:

 

(i)            compensation, wages and all fringe benefits,
workmen’s compensation insurance premiums and payroll taxes paid

 

33

 

to, for or with respect to all persons for their services in the
Operating, maintaining or cleaning of the Retail Portion of the Building,

 

(ii)           payments under service contracts with
independent contractors for the operating, maintaining or cleaning of the
Retail Portion of the Building,

 

(iii)          steam, chilled water, water, sewer, gas, oil,
electricity, telephone and other utility charges (excluding utility charges
separately chargeable to tenants for additional or separate services and
electricity charges paid by Tenant in the manner set forth in Section 5.2)
for the Retail Portion of the Building and costs of maintaining letters of
credit or other security as may be required by utility companies as a condition
of providing such services,

 

(iv)          cost of maintenance, cleaning and repairs and
replacements for the Retail Portion of the Building (other than repairs
reimbursed from contractors under, guarantees),

 

(v)           cost of rubbish removal for the Retail
Portion of the Building, including without limitation, the cost of maintaining
dumpsters and compactors,

 

(vi)          the Permitted Depreciation for the Retail
Portion of the Building,

 

(vii)         cost of cleaning supplies and equipment,

 

(viii)        the arcade common area maintenance costs
under the Overlease, and

 

(ix)           all other reasonable and necessary direct
expenses paid in connection with the operating, cleaning and maintenance of the
Retail Portion of the Building and properly chargeable against income; plus

 

(b)           the same proportion of the following costs
(which costs (x) are not otherwise included in subparagraph (a) above and (2) are
not incurred for the exclusive benefit of the Office Portion of the Building)
as the Total Rentable Floor Area of the Retail Portion of the Building bears to
the Total Rentable Floor Area of the Building:

 

34

 

(i)            cost of snow removal and care of landscaping,

 

(ii)           premiums for insurance carried with respect
to the Building or the Prudential Center (including, without limitation,
liability insurance, insurance against loss in case of fire or casualty and of
monthly installments of Annual Fixed Rent and any Additional Rent which may be
due under this Lease and other leases of space in the Building for not more
than twelve months in the case of both Annual Fixed Rent and Additional Rent
and, if there be any first mortgage on the Building, including such insurance
as may be required by the holder of such first mortgage),

 

(iii)          the cost of operation of the open areas,
public areas and amenities, plazas, common areas, facilities and other
non-leasable areas of the Prudential Center and other mixed use common area
maintenance costs under the Overlease incurred by Overlandlord, Landlord or any
other PruOwner and allocated to the Building or Overlease Premises under the
Overlease,

 

(iv)          the Permitted Depreciation,

 

(v)           management fees at reasonable rates
consistent with the type of occupancy and the services rendered, and

 

(vi)          steam, chilled water, water, sewer, gas, oil,
electricity, telephone and other utility charges (excluding utility charges
separately chargeable to tenants for additional or separate services and
electricity charges paid by Tenant in the manner set forth in Section 5.2)
for the Building and costs of maintaining letters of credit or other security
as may be required by utility companies as a condition of providing such
services.

 

6.3           TENANT’S ESCALATION PAYMENTS. (A) If with respect to any calendar year
falling within the Lease Term, or fraction of a calendar year falling within
the Lease Term at the beginning or end thereof, the Operating Expenses
Allocable to the Premises (as defined in Section 6.2) for a full calendar
year exceed Base Operating Expenses Allocable to the Premises (as defined in Section 6.2)
or for any such fraction of a calendar year exceed the corresponding fraction
of Base Operating Expenses Allocable to the Premises (such amount being
hereinafter referred to as the “Operating Cost Excess”), then Tenant shall pay
to Landlord, as

 

35

 

Additional Rent, on or before the thirtieth (30th) day following
receipt by Tenant of the statement referred to below in this Section 6.3,
the amount of such excess.

 

(B)           Payments by Tenant on account of the Operating Cost Excess shall be made
monthly at the time and in the fashion herein provided for the payment of Annual
Fixed Rent. The amount so to be paid to Landlord shall be an amount from time
to time reasonably estimated by Landlord to be sufficient to cover, in the
aggregate, a sum equal to the Operating Cost Excess for each calendar year during
the Lease Term.

 

(C)           No later than one hundred twenty (120) days after the end of the first calendar
year or fraction thereof ending December 31 and of each succeeding calendar
year during the Lease Term or fraction thereof at the end of the Lease Term,
Landlord shall render Tenant a statement in reasonable detail and according to
usual accounting practices certified by a representative of Landlord, showing for
the preceding calendar year or fraction thereof, as the case may be, the Operating
Expenses for the Building and the Operating Expenses Allocable to the Premises.
Said statement to be rendered to Tenant also shall show for the preceding year
or fraction thereof, as the case may be, the amounts already paid by Tenant on
account of Operating Cost Excess and the amount of Operating Cost Excess
remaining due from, or overpaid by, Tenant for the year or other period covered
by the statement.

 

If such statement shows a balance remaining due to Landlord, Tenant
shall pay same to Landlord on or before the thirtieth (30th) day following
receipt by Tenant of said statement. Any balance shown as due to Tenant shall
be credited against Annual Fixed Rent next due, or refunded to Tenant if the
Lease Term has then expired and Tenant has no further obligation to Landlord.

 

Any
payment by Tenant for the Operating Cost Excess shall not be deemed to waive
any rights of Tenant to claim that the amount thereof was not determined in
accordance with the provisions of this Lease.

 

(D)          Subject to the provisions of this paragraph, Tenant shall have the
right, at Tenant’s cost and expense, to examine all documentation and
calculations prepared in the determination of Operating Cost Excess:

 

1.             Such documentation and calculation shall be
made available to Tenant at the offices where Landlord keeps such records
during normal business hours within a reasonable time after Landlord receives a
written request from Tenant to make such examination.

 

36

 

2.             Tenant shall have the right to make such
examination no more than once in respect of any period for which Landlord has
given Tenant a statement of the actual amount of Operating Expenses.

 

3.             Any request for examination in respect of any
calendar year may be made no more than one (1) year after Landlord advises
Tenant of the actual amount of Operating Expenses in respect of such calendar
year and provides to Tenant the year-end statement required under Paragraph C
of this Section 6.3, provided however, if such examination results in a determination
that Tenant was overcharged with respect to a calendar year, then Tenant shall
have the right to review Landlord’s books as to the erroneous items for the two
calendar years immediately prior to the calendar year in question, and if such
examination results in a determination that Landlord committed a fraud with
respect to a calendar year, then Tenant shall have the right to review Landlord’s
hooks for the three (3) calendar years immediately prior to the calendar
year in question. If such examination results in the determination that Tenant
was overcharged with respect to a calendar year by more than five percent (5%),
then Landlord shall reimburse Tenant for the reasonable cost of such examination,
not to exceed $2,000,00.

 

4.             Such examination may be made only by an
independent certified public accounting firm or other hourly consultant
approved by Landlord, which approval shall not be unreasonably withheld.
Without limiting Landlord’s approval rights, Landlord may withhold its approval
of any examiner of Tenant who is being paid by Tenant on a contingent fee
basis.

 

5.             As a condition to performing any such
examination, Tenant and its examiners shall be required to execute and deliver
to Landlord an agreement, in form reasonably acceptable to Landlord, agreeing
to keep confidential any information which it discovers about Landlord or the Building
in connection with such examination, provided however, that Tenant shall be
permitted to share such information with each of its permitted subtenants so
long as such subtenants execute and deliver to Landlord similar confidentiality
agreements. Without limiting the foregoing, if Tenant uses any examiner which
is other than a nationally recognized accounting firm, Tenant’s examiner shall
be required to agree that it will not represent any other tenant in the
Building or in other buildings located in the Prudential Center which is owned
by Landlord or an affiliate of Landlord in connection with reviewing operating
expenses for such tenant.

 

37

 

ARTICLE VII

LANDLORD’S REPAIRS AND SERVICES

 

7.1           STRUCTURAL REPAIRS. Except for (a) normal and reasonable
wear and use and (b) damage caused by fire or casualty and by eminent
domain, Landlord shall, throughout the Lease Term, at Landlord’s sole cost and expense,
keep and maintain, or cause to be kept and maintained, in good order, condition
and repair the following portions of the Building: the structural portions of
the roof, the exterior and load bearing walls, the foundation, the structural
columns and floor slabs and other structural elements of the Building; provided
however, that Tenant shall pay to Landlord, as Additional Rent, the cost of any
and all such repairs which may be required as a result of repairs, alterations,
or installations made by Tenant or any subtenant, assignee, licensee or
concessionaire of Tenant or any agent, servant, employee or contractor of any
of them or to the extent of any loss, destruction or damage caused by the
negligence or willful misconduct of Tenant, any assignee or subtenant or any
agent, servant, employee, customer, visitor or contractor of any of them.

 

7.2           OTHER REPAIRS TO BE MADE BY LANDLORD. Except for (a) normal and reasonable
wear and use and (b) damage caused by fire or casualty and by eminent
domain, and except as otherwise provided in this Lease, and subject to provisions
for reimbursement by Tenant as contained in Section 6.3, Landlord agrees
to keep and maintain, or cause to be kept and maintained, in good order, condition
and repair the common areas and facilities of the Building, including heating,
ventilating, air conditioning, plumbing and other Building systems equipment
servicing the Premises, except that Landlord shall in no event be responsible
to Tenant for (a) the condition of glass in and about the Premises (other
than for glass in exterior walls for which Landlord shall be responsible unless
the damage thereto is attributable to Tenant’s negligence or misuse, in which
event the responsibility therefor shall be Tenant’s), or (b) any condition
in the Premises or the Building caused by any act or neglect of Tenant or any
agent, employee, contractor, assignee, subtenant, licensee, concessionaire or
invitee of Tenant. Without limitation, Landlord shall not be responsible to
make any improvements or repairs to the Building or the Premises other than as
expressly provided in Section 7.1 or in this Section 7.2, unless
expressly otherwise provided in this Lease.

 

7.3           SERVICES TO BE PROVIDED BY LANDLORD. In addition, and except as otherwise
provided in this Lease and subject to provisions for reimbursement by Tenant as
contained in Section 6.3 and Tenant’s responsibilities in regard to electricity
as provided in Section 5.2, Landlord agrees to furnish services,
utilities, facilities and supplies as set forth in Exhibit C hereto equal
in quality comparable to those customarily provided by landlords in high
quality buildings in Boston. In addition, Landlord agrees to furnish, at Tenant’s
expense, reasonable additional

 

38

 

Building operation services which are usual and customary in similar
buildings in Boston, and such additional special services as may be mutually
agreed upon by Landlord and Tenant, upon reasonable and equitable rates from
time to time established by Landlord.

 

7.4           NO DAMAGE. Landlord shall not be liable to Tenant for any compensation or reduction
of rent by reason of inconvenience or annoyance or for loss of business arising
from the necessity of Landlord or its agents entering the Premises for any purposes
in this Lease authorized, or for repairing the Premises or any portion of the
Building or Prudential Center however the necessity may occur. In case Landlord
is prevented or delayed from making any repairs, alterations or improvements,
or furnishing any services or performing any other covenant or duty to be
performed on Landlord’s part, by reason of any cause reasonably beyond Landlord’s
control, including, without limitation, strike, lockout, breakdown, accident,
order or regulation of or by any Governmental authority, or failure of supply,
or inability by the exercise of reasonable diligence to obtain supplies, parts
or employees necessary to furnish such services, or because of war or other
emergency, or for any cause due to any act or neglect of Tenant or Tenant’s
servants, agents, employees, licensees or any person claiming by, through or
under Tenant, Landlord shall not be liable to Tenant therefor, nor, except as
expressly otherwise provided in this Lease, shall Tenant be entitled to any
abatement or reduction of rent by reason thereof, nor shall the same give rise to
a claim in Tenant’s favor that such failure constitutes actual or constructive,
total or partial, eviction from the Premises.

 

Landlord reserves the right to stop any service or utility system, when
necessary by reason of accident or emergency, or until necessary repairs have
been completed; provided, however, that in each instance of stoppage, Landlord
shall exercise reasonable diligence to eliminate the cause thereof. Except in
case of emergency repairs, Landlord will give Tenant reasonable advance notice
of any contemplated stoppage and will use reasonable efforts to avoid
unnecessary inconvenience to Tenant by reason thereof.

 

7.5           Rent Abatement. Notwithstanding anything to the contrary in this
Lease contained, if due to (i) any repairs, alterations, replacements, or
improvements made by Landlord, (ii) Landlord’s failure to make any
repairs, alterations, or improvements required to be made by Landlord
hereunder, or to provide any service required to be provided by Landlord
hereunder, (iii) failure of electric supply caused by Landlord, or (iv) the
presence of any Hazardous Materials not introduced or caused by Tenant or
anyone for whom Tenant is legally responsible, any portion of the Premises is
so adversely affected thereby so that for the Premises Untenantability Cure
Period, as hereinafter defined, the continued operation in the ordinary course
of Tenant’s business is materially adversely affected, then, provided that Tenant
ceases to use the affected portion of the

 

39

 

Premises during the entirety of the Premises Untenantability Cure
Period by reason of such adverse effect, and that such adverse effect and
Landlord’s inability to cure such condition is not caused by the fault or
neglect of Tenant or Tenant’s agents, employees or contractors, Annual Fixed
Rent and Operating Cost Excess shall thereafter be abated in proportion to such
adverse effect and its impact on the continued operation in the ordinary course
of Tenant’s business until the day such condition is completely corrected. For
the purposes hereof, the “Premises Untenantability Cure Period” shall be
defined as five (5) consecutive business days after Landlord’s receipt of
written notice from Tenant of the condition causing such adverse effect in the
Premises, provided however, that the Premises Untenantability Cure Period shall
be ten (10) consecutive business days after Landlord’s receipt of written
notice from Tenant of such condition causing such adverse effect in the
Premises if either the condition was caused by causes beyond Landlord’s control
or Landlord is unable to cure such condition as the result of causes beyond
Landlord’s control. The provisions of this clause (C) shall not apply in
the event of such adverse effect caused by fire or other casualty, or taking
(see Article XIV).

 

7.6           LANDLORD’S INSURANCE. Landlord shall maintain fire and extended
coverage insurance on the Building with commercially responsible insurers and
such other insurance as is required under any mortgage. Such insurance shall
cover the Tenant Improvement Work to the extent of the Special Allowance under Section 5.3.

 

ARTICLE VIII

TENANT’S REPAIRS

 

8.1           TENANT’S REPAIRS AND MAINTENANCE. Tenant covenants and agrees that, from and
after the date that possession of the Premises is delivered to Tenant and until
the end of the Lease Term, Tenant will keep neat and clean and maintain in good
order, condition and repair the Premises and every part thereof, excepting only
for those repairs for which Landlord is responsible under the terms of Article VII
of this Lease and damage by fire or casualty and as a consequence of the
exercise of the power of eminent domain. Tenant shall not permit or commit any
waste, and Tenant shall be responsible for the cost of repairs which may be
made necessary by reason of damages to common areas in the Building or
Prudential Center by Tenant, Tenant’s agents, employees, contractors,
sublessees, licensees, concessionaires or invitees. Tenant shall maintain all
its equipment, furniture and furnishings in good order and repair.

 

If repairs are required to be made by Tenant pursuant to the terms
hereof, Landlord may demand that Tenant make the same forthwith, and if Tenant
refuses or neglects to commence such repairs and complete the same with
reasonable dispatch after such demand, Landlord may (but shall not be required
to do so)

 

40

 

make or cause such repairs to be made and shall not be responsible to
Tenant for any loss or damage that may accrue to Tenant’s stock or business by
reason thereof. If Landlord makes or causes such repairs to be made, Tenant
agrees that Tenant will forthwith on demand, pay to Landlord as Additional Rent
the cost thereof together with interest thereon at the rate specified in Section 16.21,
and if Tenant shall default in such payment, Landlord shall have the remedies
provided for non-payment of rent or other charges payable hereunder.

 

ARTICLE IX

ALTERATIONS

 

9.1           LANDLORD’S APPROVAL. Tenant covenants and agrees not to make alterations,
additions or improvements to the Premises, whether before or during the Lease
Term, except in accordance with plans and specifications therefor first
approved by Landlord in writing, which approval shall not be unreasonably
withheld or delayed. However, Landlord’s determination of matters relating to
aesthetic issues relating to alterations, additions or improvements which are
visible outside the Premises shall be in Landlord’s sole discretion. Without
limiting such standard, Landlord shall not be deemed unreasonable:

 

(a)           for withholding approval of any alterations,
additions or improvements which (i) in Landlord’s opinion might affect any
structural or exterior element of the Building, any area or element outside of
the Premises or any facility or base building mechanical system serving any
area of the Building outside of the Premises, or (ii) involve or affect
the exterior design, size, height or other exterior dimensions of the Building,
or (iii) enlarge the Rentable Floor Area of the Premises, or (iv) are
inconsistent, in Landlord’s judgment, with alterations satisfying Landlord’s
standards for new alterations in the Building.

 

(b)           for making its approval conditional on Tenant’s
agreement to restore the Premises to its condition prior to such alteration,
addition, or improvement at the expiration or earlier termination of the Lease
Term.

 

Landlord’s review and approval of any such plans and specifications or
under Section 4.1 and consent to perform work described therein shall not
be deemed an agreement by Landlord that such plans, specifications and work
conform with applicable Legal Requirements and requirements of insurers of the
Building (herein called “Insurance Requirements”) nor deemed a waiver of Tenant’s
obligations under this Lease with respect to applicable Legal Requirements and Insurance
Requirements nor impose any liability or obligation upon Landlord with respect
to the completeness, design sufficiency or compliance of such plans, specifications
and work with applicable Legal Requirements and Insurance Requirements.

 

41

 

9.1.1        CERTAIN ALTERATIONS. Notwithstanding the terms of Section 9.1,
Tenant shall have the right, without obtaining the prior consent of Landlord,
but upon at least five (5) business days’ prior written notice to
Landlord, to make alterations, additions or improvements to the Premises where:

 

(i)            the same are within the interior of the Premises
within the Building, and do not affect the exterior of the Premises and the
Building;

 

(ii)           the same do not affect the roof, any
structural element of the Building, the mechanical, electrical, plumbing,
heating, ventilating, air-conditioning and fire protection systems of the
Building;

 

(iii)          the cost of any individual alteration,
addition or improvement shall not exceed $100,000.00 in each instance; and

 

(iv)          Tenant shall comply with the provisions of
this Lease and if such work increases the cost of insurance or taxes or of
services, Tenant shall pay for any such increase in cost.

 

9.2           CONFORMITY OF WORK. Tenant covenants and agrees that any
alterations, additions, improvements or installations made by it to or upon the
Premises shall be done in a good and workmanlike manner and in compliance with
all applicable Legal Requirements and Insurance Requirements now or hereafter
in force, that materials of first and otherwise good quality shall be employed
therein, that the structure of the Building shall not be endangered or impaired
thereby and that the Premises shall not be diminished in value thereby.

 

9.3           PERFORMANCE OF WORK, GOVERNMENTAL PERMITS AND
INSURANCE. All of Tenant’s
alterations and additions and installation of furnishings shall be coordinated
with any work being performed by or for Landlord and in such manner as to
maintain harmonious labor relations and not to damage the Building or
Prudential Center or interfere with Building construction or operation and,
except for installation of furnishings, shall be performed by Landlord’s
general contractor or by contractors or workmen first approved by Landlord.
Except for work by Landlord’s general contractor, Tenant shall procure all
necessary governmental permits before making any repairs, alterations, other improvements
or installations. Tenant agrees to save harmless and indemnify Landlord from
any and all injury, loss, claims or damage to any person or property occasioned
by or arising out of the doing of any such work whether the same be performed
prior to or during the Term of this Lease. At Landlord’s election, Tenant shall
cause its contractor to maintain a payment and performance bond in such amount
and with such companies as Landlord shall reasonably

 

42

 

approve. In addition, Tenant shall cause each contractor to carry
workmen’s compensation insurance in statutory amounts covering the employees of
all contractors and subcontractors, and commercial general liability insurance
or comprehensive general liability insurance with a broad form comprehensive
liability endorsement with such limits as Landlord may require reasonably from
time to time during the Term of this Lease, but in no event less than the
minimum amount of commercial general liability insurance or comprehensive
general liability insurance Tenant is required to maintain as set forth in Section 1.2
hereof and as the same may be modified as provided in Section 13.2 hereof
(all such insurance to be written in companies approved reasonably by Landlord
and insuring Landlord, Landlord’s managing agent and Tenant as additional
insureds as well as contractors) and to deliver to Landlord certificates of all
such insurance.

 

9.4           LIENS. Tenant covenants and agrees to pay promptly when due the entire cost
of any work done on the Premises by Tenant, its agents, employees or
contractors, and not to cause or permit any liens for labor or materials
performed or furnished in connection therewith to attach to the Premises or the
Building or the Prudential Center and immediately to discharge any such liens
which may so attach.

 

9.5           NATURE OF ALTERATIONS. All work, construction, repairs,
alterations, other improvements or installations made to or upon the Premises
(including, but not limited to, the construction performed by Landlord under Article IV),
shall become part of the Premises and shall become the property of Landlord and
remain upon and be surrendered with the Premises as a part thereof upon the expiration
or earlier termination of the Lease Term, except as follows:

 

(a)           All trade fixtures whether by law deemed to
be a part of the realty or not, installed at any time or times by Tenant or any
person claiming under Tenant shall remain the property of Tenant or persons
claiming under Tenant and may be removed by Tenant or any person claiming under
Tenant at any time or times during the Lease Term or any occupancy by Tenant
thereafter and shall be removed by Tenant at the expiration or earlier
termination of the Lease Term if so requested by Landlord. Tenant shall repair
any damage to the Premises occasioned by the removal by Tenant or any person
claiming under Tenant of any such property from the Premises.

 

(b)           At the expiration or earlier termination of
the Lease Term, unless otherwise agreed in writing by Landlord, Tenant shall
remove any wiring for Tenant’s computer, telephone and other communication
systems and equipment which is located in any risers or conduits (but not any
such wiring located within the Premises) and, at Landlord’s election, any alterations,
additions and improvements made with Landlord’s consent during the Lease Term
which would be unusually expensive to demolish

 

43

 

or remove. If Tenant has an interior staircase installed within the
Premises then Tenant shall at the expiration or earlier termination of the
Lease Term remove such interior staircase and close up the openings and restore
all damage, all in accordance with plans and specifications prepared by the
Tenant and approved by the Landlord, such approval not to be unreasonably
withheld, delayed or conditioned, unless no later than thirty (30) days prior
to such expiration or earlier termination date, Landlord informs Tenant that
such staircase is not to be removed, in which case such staircase shall not be
removed and shall remain in place. If Tenant has the obligation to remove the
staircase and has not removed the same by the expiration or earlier termination
date, then Landlord may remove the same at Tenant’s cost and Tenant shall pay
to Landlord the costs incurred by Landlord in effecting such removal promptly
upon billing therefor.  Landlord agrees
to make such election at the time Landlord approves Tenant’s plans for such
alterations, additions or improvements (or at the time Tenant gives Landlord
plans and specifications for work performed pursuant to Section 9.1.1) if
Tenant requests in writing that Landlord make such election at the time that
Tenant requests Landlord’s approval (or at the time that Tenant gives Landlord
plans and specifications as aforesaid) and Tenant cites the relevant Lease Section to
which such request applies. Upon such removal Tenant shall restore the Premises
to their condition prior to such alterations, additions and improvements and
repair any damage occasioned by such removal and restoration.

 

(c)           If Tenant shall make any alterations,
additions or improvements to the Premises for which Landlord’s approval is
required under Section 9.1 without obtaining such approval, then at
Landlord’s request at any time during the Lease Term, and at any event at the
expiration or earlier termination of the Lease Term, Tenant shall remove such
alterations, additions and improvements and restore the Premises to their
condition prior to same and repair any damage occasioned by such removal and
restoration. Nothing herein shall be deemed to be a consent to Tenant to make
any such alterations, additions or improvements, the provisions of Section 9.1
being applicable to any such work.

 

9.6           INCREASES IN TAXES. Tenant shall pay, as Additional Rent, one
hundred percent (100%) of any increase in real estate taxes on the Building
which shall, at any time after the Commencement Date, result from alterations,
additions or improvements to the Premises made by Tenant if the taxing
authority specifically determines such increase results from such alterations,
additions or improvements made by Tenant.

 

44

 

9.7           EARLY ENTRY. Landlord hereby grants to Tenant a license to enter the Premises
prior to the Substantial Completion Date in order to perform such installation
or work to the Premises as Tenant shall require and as shall be permitted by
the terms of this Lease; provided, however, that (i) no such entry shall
be made until Landlord has determined that such entry may made be made in a
safe manner dependent upon the status of completion of the Building, (ii) no
such entry or work shall delay Landlord in the performance of its work in the
Building or Premises and any such delay shall be a “Tenant Delay”, and Landlord
may revoke such license if any such delay shall occur or be threatened, and (iii) any
such access or work shall be at Tenant’s sole risk and, prior to making any
such access, Tenant shall deliver to Landlord certificates for the insurance
required under this Lease. All of the terms and conditions of this Lease,
except for the payment of rent and other charges, shall apply during such
period of early access.

 

ARTICLE X

PARKING

 

10.1         PARKING PRIVILEGES. Commencing on the Commencement Date,
Landlord shall provide to Tenant monthly parking privileges in the portion of
the Prudential Center Garage designated for the Building (the “Garage”) of one (1) pass
for each 2,000 Rentable Square Feet of Premises leased by Tenant (including any
premises demised to Tenant pursuant to Tenant’s expansion and/or right of first
offer rights as set forth in Sections 2.2 and 2.3 hereof) for the parking of
motor vehicles in unreserved stalls in the Garage by Tenant’s employees (“Unreserved
Passes”). In addition, commencing on the Commencement Date, Landlord shall
provide to Tenant monthly parking privileges of two (2) passes for the
parking of motor vehicles in reserved spaces in the Garage by Tenant’s
employees (“Reserved Spaces”), which reserved spaces will be located in one of
the areas shown hatched on Exhibit I.

 

10.2         PARKING CHARGES. With respect to the Unreserved Spaces,
Tenant shall pay for such parking privileges at the prevailing monthly rates
from time to time charged by the operator or operators of the Garage, for
unreserved spaces whether or not such operator is an affiliate of Landlord.
With respect to the Reserved Spaces, Tenant shall pay for such parking
privileges at the prevailing monthly rates from time to time charged by the
operator or operators of the Garage for reserved spaces, whether or not such
operator is an affiliate of Landlord.

 

10.3         GARAGE OPERATION. Unless otherwise determined by Landlord or Overlandlord
or the operator of the Garage (the “Garage Operator”), the Garage is to be
operated on a self-parking basis, and Tenant shall be obligated to park and remove
its own automobiles, and, other than in connection with the Reserved Passes,
Tenant’s parking shall be on an unreserved basis, Tenant having the right

 

45

 

to park in any available stalls. Tenant’s access and use privileges
with respect to the Garage shall be in accordance with regulations of uniform
applicability to the users of the Garage from time to time established by the
Landlord, Overlandlord or the Garage Operator. Tenant shall receive one (1) identification
sticker or pass and one (1) magnetic card so-called, or other suitable
device providing access to the Garage, for each parking privilege paid for by
Tenant. Tenant shall supply Landlord with an identification roster listing, for
each identification sticker or pass, the name of the employee and the make,
color and registration number of the vehicle to which it has been assigned, and
shall provide a revised roster to Landlord monthly indicating changes thereto.
Any automobile found parked in the Garage during normal business hours without
appropriate identification will be subject to being towed at said automobile
owner’s expense. The parking privileges granted herein are non-transferable
(other than to a permitted assignee or subtenant pursuant to the applicable
provisions of Article XII hereof). Landlord or Overlandlord or the Garage
Operator may institute a so-called valet parking program for the Garage, and in
such event Tenant shall cooperate in all respects with such program. Landlord
reserves for itself and Overlandlord and any other PruOwner the right to alter
the Garage as it sees fit and in such case to change the Garage including the
reduction in area of the same, Tenant acknowledging that in connection with the
potential expansion of buildings in the Prudential Center or the addition of
other buildings thereto, it may be necessary to make significant changes to the
Garage which may result in the reduction of the amount of parking available in
the Garage and the change of location of such parking or may change the access
to or egress from the Garage, all of which Landlord, Overlandlord or any other
PruOwner may perform in its sole and exclusive discretion, without limitation
to its other rights in respect thereof. Notwithstanding the foregoing, in no
event shall the number of Tenant’s Reserved Passes or Unreserved Passes be
reduced during the Term.

 

10.4         LIMITATIONS. Tenant agrees that it and all persons claiming by, through and under
it, shall at all times abide by all reasonable rules and regulations
promulgated by Landlord, Overlandlord or the Garage Operator with respect to
the use of the Garage, but such rules and regulations shall not be
inconsistent with this Lease. Except to the extent of gross negligence or
willful acts, neither the Landlord nor Overlandlord nor Garage Operator assumes
any responsibility whatsoever for loss or damage due to fire or theft or
otherwise to any automobile or to any personal property therein, however
caused, and Tenant agrees, upon request from the Landlord, from time to time,
to notify its officers, employees and agents then using any of the parking
privileges provided for herein, of such limitation of liability. Tenant further
acknowledges and agrees that a license only is hereby granted, and no bailment
is intended or shall be created.

 

46

 

ARTICLE XI

CERTAIN TENANT COVENANTS

 

Tenant
covenants during the Lease Term and for such further time as Tenant occupies
any part of the Premises:

 

11.1         To pay when due all Annual Fixed Rent and
Additional Rent and all charges for utility services rendered to the Premises
and service inspections therefor except as otherwise provided in Exhibit C
and, as further Additional Rent, all charges for additional and special
services rendered pursuant to Section 7.3.

 

11.2         To use and occupy the Premises for the
Permitted Use only, and not to injure or deface the Premises or the Building or
Prudential Center and not to permit in the Premises any auction sale, or
flammable fluids or chemicals, or nuisance, or the emission from the Premises
of any objectionable noise or odor and not to use or devote the Premises or any
part thereof for any purpose other than the Permitted Use, nor any use thereof
which is inconsistent with the maintenance of the Building as an office
building of the first-class in the quality of its maintenance, use and
occupancy, or which is improper, offensive, contrary to law or ordinance or
liable to invalidate or increase the premiums for any insurance on the Building
or its contents or liable to render necessary any alteration or addition to the
Building. Further, (i) Tenant shall not, nor shall Tenant permit its
employees, invitees, agents, independent contractors, contractors, assignees or
subtenants to, keep, maintain, store or dispose of (into the sewage or waste
disposal system or otherwise except for standard office and cleaning supplies
stored, handled and disposed of in accordance with all applicable laws) or
engage in any activity which might produce or generate any substance which is
or may hereafter be classified as a hazardous material, waste or substance
(collectively “Hazardous Materials”), under federal, state or local laws, rules and
regulations, including, without limitation, 42 U.S.C. Section 6901 et seq.,
42 U.S.C. Section 9601 et seq., 42 U.S.C. Section 2601 et seq., 49
U.S.C. Section 1802 et seq. and Massachusetts General Laws, Chapter 21E
and the rules and regulations promulgated under any of the foregoing, as
such laws, rules and regulations may be amended from time to time
(collectively “Hazardous Materials Laws”), (ii) Tenant shall immediately notify
Landlord of any incident in, on or about the Premises, the Building or the Prudential
Center that would require the filing of a notice under any Hazardous Materials
Laws, (iii) Tenant shall comply and shall cause its employees, invitees, agents,
independent contractors, contractors, assignees and subtenants to comply with each
of the foregoing and (iv) Landlord shall have the right to make such inspections
(including testing) as Landlord shall elect from time to time to determine that
Tenant is complying with the foregoing.

 

Landlord shall indemnify Tenant and hold it harmless against any
claims, damages, losses or liabilities (including reasonable attorneys’ and
expert

 

47

 

consultants’ fees) arising in the event that Landlord, Landlord’s
agents, employees or contractors release Hazardous Materials onto the Building
or the Prudential Center; provided however, the foregoing indemnity shall not
apply to: (i) any material or substance existing on the Prudential Center
as of the Execution Date of this Lease which, as of the Date of this Lease, was
not considered, as a matter of law, to be a Hazardous Material, but which is
subsequently determined to be a Hazardous Material as a matter of law or (ii) any
material or substance released or installed or placed on the Prudential Center
after the Execution Date of this Lease which, as of the date of such release,
installation or placement, was not considered, as a matter of law, to be a
Hazardous Material but which is later determined, as a matter of law, to be a
Hazardous Material. In addition, if Hazardous Materials are discovered in the
Building or the Premises which are not caused by Tenant, its employees,
invitees, agents, independent contractors, contractors, assignees or
subtenants, then Landlord shall, if and as required by law, assess, remediate
or remove the same, or cause the same to be assessed, remediated or removed.

 

11.3         Not to obstruct in any manner any portion of
the Building not hereby leased or any portion thereof or of the Prudential
Center used by Tenant in common with others; not without prior consent of
Landlord to permit the painting or placing of any signs, curtains, blinds,
shades, awnings, aerials or flagpoles, or the like, visible from outside the
Premises; and to comply with all Rules and Regulations (as set forth in Section 16.30)
now or hereafter made by Landlord or Overlandlord, of which Tenant has been
given notice, for the care and use of the Building and the Prudential Center
and their facilities and approaches, but neither Landlord nor Overlandlord
shall be liable to Tenant for the failure of other occupants of the Building to
conform to such rules and regulations.

 

11.4         To keep the Premises equipped with all safety
appliances required by law or ordinance or any other regulation of any public
authority because of any use made by Tenant other than normal office use, and
to procure all licenses and permits so required because of any use made by
Tenant other than normal office use, and to procure all licenses and permits so
required because of such use and, if requested by Landlord, to do any work so
required because of such use, it being understood that the foregoing provisions
shall not be construed to broaden in any way Tenant’s Permitted Use.

 

11.5         Not to place a load upon any floor in the
Premises exceeding an average rate of 70 pounds of live load (including
partitions) per square foot of floor area, except where the floor has been
shored up by Tenant in accordance with plans and specifications approved by
Landlord, and notwithstanding such approval or shoring up, Tenant shall remain
responsible for any damage to the Premises or Building caused by any
overloading; and not to move any safe, vault or other heavy equipment in, about
or out of the Premises except in such manner and at

 

48

 

such time as Landlord shall in each instance authorize. Tenant’s
business machines and mechanical equipment shall be placed and maintained by
Tenant at Tenant’s expense in settings sufficient to absorb and prevent
vibration or noise that may be transmitted to the Building structure or to any
other space in the Building.

 

11.6         To pay promptly when due all taxes which may
be imposed upon personal property (including, without limitation, fixtures and
equipment) in the Premises to whomever assessed.

 

11.7         To pay, as Additional Rent, all reasonable
costs, counsel and other fees incurred by Landlord in connection with the
successful enforcement by Landlord of any obligations of Tenant under this
Lease or in connection with any bankruptcy case involving Tenant or any
guarantor.

 

11.8         Not to do or permit anything to be done in or
upon the Premises, or bring in anything or keep anything therein, which shall
increase the rate of insurance on the Premises or on the Building above the
standard rate applicable to premises being occupied for the use to which Tenant
has agreed to devote the Premises; and Tenant further agrees that, in the event
that Tenant shall do any of the foregoing, Tenant will promptly pay to
Landlord, on demand, any such increase resulting therefrom, which shall be due
and payable as Additional Rent hereunder.

 

11.9         To comply with all applicable Legal
Requirements now or hereafter in force which shall impose a duty on Landlord or
Tenant relating to or as a result of the use or occupancy of the Premises other
than for general office purposes; provided that Tenant shall not be required to
make any alterations or additions to the structure, roof, exterior and load
bearing walls, foundation, structural floor slabs and other structural elements
of the Building unless the same are required by such Legal Requirements as a
result of or in connection with Tenant’s use or occupancy of the Premises
beyond normal use of space of this kind. If Tenant receives notice of any
violation of law, ordinance, order or regulation applicable to the Premises, it
shall give prompt notice thereof to Landlord. Tenant shall promptly pay all
fines, penalties and damages that may arise out of or be imposed because of its
failure to comply with the provisions of this Section 11.9. Landlord,
subject to inclusion of the cost of compliance as Operating Costs to the extent
permitted by the provisions of Section 6.2 of this Lease, shall comply
with (i) all Laws which relate to the structure of the Building, unless
the need for such compliance arises from Tenant’s particular use of the
Premises or any alterations made by Tenant, and (ii) all other Laws
applicable to the Building, or the use and occupancy thereof, other than those
Laws for which Tenant is responsible pursuant to this Section 11.9 or,
with respect to another tenant’s premises, for which such tenant is responsible
pursuant to the provisions of its lease with Landlord.

 

49

 

11.10       The word “Prudential” alone or in any
combination other than “Prudential Center” shall not be used by the Tenant for
any purpose whatsoever. Tenant shall not use the words “Prudential Center”
other than as part of the business address of Tenant and then only in such
manner as will not appear to be part of Tenant’s name. Tenant shall not use the
words “Prudential Center” in any manner which is undignified, confusing,
detrimental or misleading in Landlord’s opinion and shall give no greater
prominence to the words “Prudential Center” than to any other part of the
business address of Tenant and shall give less prominence to the words “Prudential
Center” than to Tenant’s name. The Tenant shall not utilize signage or
advertising which contains (a) any description of the Prudential Center or
the description of the location of the Premises other than “Prudential Center”,
“at Prudential Center”, or an official street address such as “Boylston Street”
or “Huntington Avenue” or a regional locator such as “Boston” or “Back Bay” and
(b) any name of a building, space or area within the Prudential Center
other than “Prudential Tower” if Tenant is located within the Prudential Tower
in order to describe the location of the Premises.

 

In order to reduce peak-hour trip generation of employees at the
Prudential Center, the Landlord encourages all employers at the Prudential
Center to adopt flexible work schedules for its employees. The Landlord
encourages all employers at the Prudential Center to participate in the
Corporate Pass Program of the Massachusetts Bay Transit Authority which is
designed to encourage the use of mass transit by persons working in Boston. As
of June 1988, one hundred and twenty-five greater Boston companies
provided subsidies for the purchase by their employees of monthly transit
passes through this program with subsidies ranging from 10% to 100% of the cost
of the transit pass. The provision of transit pass subsidies may also offer
certain benefits to employers under tax law. The Landlord encourages all
employers at the Prudential Center to participate in this program and to inform
their employees of the benefits of using monthly transit passes.

 

ARTICLE XII

ASSIGNMENT AND SUBLETTING

 

12.1         RESTRICTIONS ON TRANSFER. Except as otherwise expressly provided
herein, Tenant covenants and agrees that it shall not assign, mortgage, pledge,
hypothecate or otherwise transfer this Lease and/or Tenant’s interest in this
Lease or sublet (which term, without limitation, shall include granting of
concessions, licenses or the like) the whole or any part of the Premises. Any
assignment, mortgage, pledge, hypothecation, transfer or subletting not
expressly permitted in or consented to by Landlord under this Article XII
shall be void, ab initio; shall be of no force and effect; and shall confer no
rights on or in favor of third parties. In

 

50

 

addition, Landlord shall be entitled to seek specific performance of,
and other equitable relief with respect to, the provisions hereof.

 

12.2         EXCEPTIONS. Notwithstanding the foregoing provisions of Section 12.1 above and
the provisions of Section 12.4 below, but subject to the provisions
of Sections 12.5, 12.6 and 12.7 below, Tenant shall have the right to assign
this Lease or to sublet the Premises (in whole or in part) to any parent or
subsidiary corporation of Tenant or to any controlling corporation of Tenant or
to any corporation controlled by Tenant or to any corporation under common
control with Tenant (such parent or subsidiary corporation or corporation under
common control with Tenant being hereinafter called a “Tenant Affiliate”) or to
any corporation, limited liability partnership or limited liability company or
other entity into which Tenant may be converted or with which it may merge, or
to any entity purchasing or leasing all or substantially all of Tenant’s
assets, provided that the entity to which this Lease is so assigned or which so
sublets the Premises has a net worth (e.g. assets on a pro forma basis using
generally accepted accounting principles consistently applied and using the
most recent financial statements) equal to (or more than) the net worth of the
Tenant immediately before such transaction. If any Tenant Affiliate to which
this Lease is assigned or the Premises sublet (in whole or in part) shall cease
to be such a Tenant Affiliate, and if such cessation was contemplated at the
time of the assignment or subletting, such cessation shall be considered an
assignment or subletting requiring Landlord’s consent.

 

12.3         LANDLORD’S TERMINATION RIGHT. Notwithstanding the provisions of Section 12.1
above, in the event Tenant desires to assign this Lease or to sublet the whole
or any part of the Premises, Tenant shall notify Landlord thereof in writing
and Landlord shall have the right at its sole option, to be exercised within thirty
(30) days after receipt of Tenant’s notice, to terminate this Lease (provided however,
that if Tenant proposes to sublet less than the entire Premises and/or such
proposed subletting is for less than the balance of the Term, Landlord shall have
the right to terminate the Lease only with respect to the portion of the Premises
proposed to be sublet and for the term of the proposed subletting) as of a date
specified in a notice to Tenant, which date shall not be earlier than sixty (60)
days nor later than one hundred and twenty (120) days after Landlord’s notice
to Tenant; provided, however, that upon the termination date as set forth in Landlord’s
notice, all obligations relating to the period after such termination date (but
not those relating to the period before such termination date) shall cease and promptly
upon being billed therefor by Landlord, Tenant shall make final payment of all
Annual Fixed Rent and Additional Rent due from Tenant through the termination
date. In the event that Landlord shall not exercise its termination rights as
aforesaid, or shall fail to give any or timely notice pursuant to this Section the
provisions of Sections 12.4-12.7 shall be applicable. This Section 12.3
shall not be applicable to an assignment or sublease pursuant to Section 12.2.

 

51

 

12.4         CONSENT OF LANDLORD. Notwithstanding the provisions of Section 12.1
above, but subject to the provisions of this Section 12.4 and the
provisions of Sections 12.5, 12.6 and 12.7 below, in the event that Landlord
shall not have exercised the termination right as set forth in Section 12.3,
or shall have failed to give any or timely notice under Section 12.3, then
for a period of one hundred fifty (150) days (i) after the receipt of
Landlord’s notice stating that Landlord does not elect the termination right,
or (ii) after the expiration of the thirty (30) day period referred to in Section 12.3
in the event Landlord shall not give any or timely notice under Section 12.3,
as the case may be, Tenant shall have the right to assign this Lease or sublet
the whole or any part of the Premises in accordance with Tenant’s notice to
Landlord given as provided in Section 12.5 provided that, in each
instance, Tenant first obtains the express prior written consent of Landlord,
which consent shall not be unreasonably withheld or delayed. Without limiting
the foregoing standard, Landlord shall not be deemed to be unreasonably
withholding its consent to such a proposed assignment or subleasing if:

 

(a)           the proposed assignee or subtenant is a
tenant in the Building or elsewhere in the Prudential Center or is (or within
the previous sixty (60) days has been) in active negotiation with Landlord or
Landlord’s affiliate for premises in the Building or elsewhere in the
Prudential Center (and at Tenant’s written request Landlord shall furnish
Tenant with a list of such entities with which Landlord or its affiliate is (or
within 60 days has been) in active negotiation) or is not of a character consistent
with the operation of a first class office building (by way of example Landlord
shall not be deemed to be unreasonably withholding its consent to an assignment
or subleasing to any governmental or quasi-governmental agency). Notwithstanding
the following, Landlord will not withhold its consent solely because the
proposed subtenant or assignee is an occupant of the Building or elsewhere in
the Prudential Center, if Landlord or Landlord’s affiliate does not have space
available for lease in the Building or elsewhere in the Prudential Center that
is comparable to the space Tenant desires to sublet or assign. For purposes
hereof, Landlord or such affiliate shall be deemed to have comparable space if
it has space available on any floor of the Building or elsewhere in the
Prudential Center that is approximately the same size as the space Tenant
desires to sublet or assign within six (6) months of the proposed
commencement of the proposed sublease or assignment, or

 

(b)           the proposed assignee or subtenant is not of
good character and reputation, or

 

(c)           the proposed assignee or subtenant does not
possess adequate financial capability to perform the Tenant obligations as and
when due or required, or

 

52

 

(d)           the assignee or subtenant proposes to use the
Premises (or part thereof) for a purpose other than the purpose for which the
Premises may be used as stated in Section 1.2 hereof, or

 

(e)           the character of the business to be conducted
or the proposed use of the Premises by the proposed subtenant or assignee shall
(i) be likely to increase Operating Expenses for the Building beyond that
which Landlord now incurs for use by Tenant; (ii) be likely to increase
the burden on elevators or other Building systems or equipment over the burden
prior to such proposed subletting or assignment; or (iii) violate or be
likely to violate any provisions or restrictions contained herein relating to
the use or occupancy of the Premises, or

 

(f)            there shall be existing an Event of Default
(defined in Section 15.1).

 

12.5         TENANT’S NOTICE. Tenant shall give Landlord prior notice of
any proposed sublease or assignment, and said notice shall specify the
provisions of the proposed assignment or subletting, including (a) the
name and address of the proposed assignee or subtenant, (b) in the case of
a proposed assignment or subletting pursuant to Section 12.4, such
information as to the proposed assignee’s or proposed subtenant’s net worth and
financial capability and standing as may reasonably be required for Landlord to
make the determination referred to in Section 12.4 above (provided,
however, that Landlord shall hold such information confidential having the
right to release same to its officers, accountants, attorneys and mortgage
lenders on a confidential basis), (c) all of the terms and provisions upon
which the proposed assignment or subletting is to be made, (d) in the case
of a proposed assignment or subletting pursuant to Section 12.4, all other
information necessary to make the determination referred to in Section 12.4
above and (e) in the case of a proposed assignment or subletting pursuant
to Section 12.2 above, such information as may be reasonably required by
Landlord to determine that such proposed assignment or subletting complies with
the requirements of said Section 12.2.

 

If Landlord shall consent to the proposed assignment or subletting, as
the case may be, then, in such event, Tenant may thereafter sublease the whole
or any part of the Premises or assign pursuant to Tenant’s notice, as given
hereunder; provided, however, that if such assignment or sublease shall not be
executed and delivered to Landlord within one hundred fifty (150) days after
the date of Landlord’s consent, the consent shall be deemed null and void and
the provisions of Section 12.3 shall be applicable.

 

12.6         PROFIT ON SUBLEASING OR ASSIGNMENT. In addition, in the case of any assignment
or subleasing as to which Landlord may consent (other than an

 

53

 

assignment or subletting permitted under Section 12.2 hereof) such
consent shall be upon the express and further condition, covenant and
agreement, and Tenant hereby covenants and agrees that, in addition to the
Annual Fixed Rent, Additional Rent and other charges to be paid pursuant to
this Lease, fifty percent (50%) of the “Assignment/Sublease Profits”
(hereinafter defined), if any shall be paid to Landlord.

 

The “Assignment/Sublease Profits” shall be the excess, if any, of (a) the
“Assignment/Sublease Net Revenues” as hereinafter defined over (b) the
Annual Fixed Rent, Additional Rent and other charges provided in this Lease
(provided, however, that for the purpose of calculating the Assignment/Sublease
Profits in the case of a sublease, appropriate proportions in the applicable
Annual Fixed Rent, Additional Rent and other charges under this Lease shall be
made based on the percentage of the Premises subleased and on the terms of the
sublease). The “Assignment/Sublease Net Revenues” shall be the fixed rent,
additional rent and all other charges and sums payable either initially or over
the term of the sublease or assignment plus all other profits and increases to
be derived by Tenant as a result of such subletting or assignment, less the
reasonable costs of Tenant incurred in such subleasing or assignment (the
definition of which shall include but not necessarily be limited to rent
concessions, brokerage commissions and alteration allowances) amortized over
the term of the sublease or assignment.

 

All payments of the Assignment/Sublease Profits due Landlord shall be
made within ten (10) days of receipt of same by Tenant.

 

12.7         ADDITIONAL CONDITIONS. (A) It shall be a condition of the
validity of any assignment or subletting permitted under Section 12.2
above, or consented to under Section 12.4 above, that both Tenant and the
assignee or sublessee agree directly with Landlord in a separate written
instrument reasonably satisfactory to Landlord which contains terms and
provisions reasonably required by Landlord, including, without limitation, the
agreement of the assignee or sublessee to be bound by all the obligations of
the Tenant hereunder, including, without limitation, the obligation to pay the
Annual Fixed Rent, Additional Rent, and other amounts provided for under this
Lease (but in the case of a partial subletting pursuant to Section 12.2,
such subtenant shall agree on a pro rata basis to be so bound) including the
provisions of Sections 12.1 through 12.7 hereof, but such assignment or
subletting shall not relieve the Tenant named herein of any of the obligations
of the Tenant hereunder, Tenant shall remain fully and primarily liable
therefor and the liability of Tenant and such assignee (or subtenant, as the
case may be) shall be joint and several. Further, and notwithstanding the
foregoing, the provisions hereof shall not constitute a recognition of the
assignment or the assignee thereunder or the sublease or the subtenant
thereunder, as the case may be, and at Landlord’s option, upon the termination
of the Lease, the assignment or sublease shall be terminated.

 

54

 

(B)           As Additional Rent, Tenant shall reimburse Landlord promptly for reasonable
out of pocket legal and other expenses incurred by Landlord in connection with
any request by Tenant for consent to assignment or subletting.

 

(C)           If this Lease be assigned, Landlord may upon prior notice to Tenant, at
any time and from time to time, collect Annual Fixed Rent, Additional Rent, and
other charges from the assignee and apply the net amount collected to the
Annual Fixed Rent, Additional Rent and other charges herein reserved, but no
such assignment or collection shall be deemed a waiver of this covenant, or a
waiver of the provisions of Sections 12.1 through 12.6 hereof, or the
acceptance of the assignee as a tenant or a release of Tenant from the further
performance by Tenant of covenants on the part of Tenant herein contained, the
Tenant herein named to remain primarily liable under this Lease.

 

(D)          If the Premises or any part thereof be sublet or occupied by anyone
other than Tenant, Landlord may upon prior notice to Tenant, at any time after
an Event of Default hereunder and from time to time thereafter while such Event
of Default remains uncured, collect all of the rent and other charges due under
such sublease from the sublessee or occupant and apply the net amount collected
to the Annual Fixed Rent, Additional Rent and other charges herein reserved,
but no such subletting, occupancy or collection shall be deemed a waiver of
this covenant, or a waiver of the provisions of Sections 12.1 through 12.6
hereof, or the acceptance of the sublessee or occupant as a tenant or a release
of Tenant from the further performance by Tenant of covenants on the part of
Tenant herein contained, the Tenant herein named to remain primarily liable
under this Lease.

 

(E)           No assignment or subletting under any of the provisions of Sections
12.2 or 12.4 shall in any way be construed to relieve Tenant from obtaining the
express consent in writing of Landlord to any further assignment or subletting.

 

ARTICLE XIII

INDEMNITY AND COMMERCIAL GENERAL LIABILITY INSURANCE

 

13.1         TENANT’S INDEMNITY. To the maximum extent this agreement may be
made effective according to law and except as expressly provided in Section 13.1.1,
Tenant agrees to indemnify and save harmless Landlord and Overlandlord from and
against all claims of whatever nature arising from or claimed to have arisen
from any breach of this Lease by Tenant or any act, omission or negligence of
Tenant, or Tenant’s contractors, licensees, invitees, agents, servants,
independent contractors or employees; any accident, injury or damage whatsoever
caused to any person, or to the property of any person, occurring in or about
the Premises after the date that possession of the Premises is first delivered
to Tenant and until the end of the Lease Term and thereafter, provided that
during any such period

 

55

 

after the Lease Term Tenant or anyone acting by, through or under
Tenant is in occupancy of the Premises or any portion thereof; or any accident,
injury or damage occurring outside the Premises but within the Building, the
Garage or on the Prudential Center, where such accident, injury or damage results,
or is claimed to have resulted, from an act, omission or negligence on the part
of Tenant or Tenant’s contractors, licensees, invitees, agents, servants,
independent contractors or employees.

 

This indemnity and hold harmless agreement shall include indemnity
against all costs, expenses and liabilities incurred in or in connection with
any such claim or proceeding brought thereon, and the defense thereof.

 

13.1.1.     LANDLORD’S INDEMNITY. Subject to the limitations on Landlord’s
liability set forth in this Lease, Landlord agrees to indemnify, defend and
save harmless Tenant from and against any claim arising from any accident,
injury or damage occurring in the Premises, in the Building or on the
Prudential Center after the date that possession of the Premises is first
delivered to Tenant and until the expiration or earlier termination of the
Lease Term, to the extent that such accident, injury or damage results from any
act, omission or negligence of Landlord or Landlord’s agents, employees or
contractors.

 

Subject to the limitations on Landlord’s liability set forth in this
Lease, this indemnity and hold harmless agreement shall include indemnity
against all costs, expenses and liabilities incurred in or in connection with
any such claim or proceeding brought thereon, and the defense thereof.

 

13.2         COMMERCIAL GENERAL LIABILITY INSURANCE. Tenant agrees to maintain in full force
from the date upon which Tenant first enters the Premises for any reason,
throughout the Lease Term of this Lease, and thereafter, so long as Tenant is
in occupancy of any part of the Premises, a policy of commercial general
liability or comprehensive general liability insurance written on an occurrence
basis with a broad form comprehensive liability endorsement under which
Landlord and Landlord’s managing agent and Overlandlord and Overlandlord’s
managing agent (and such other persons as are in privity of estate with
Landlord and Landlord’s managing agent as may be set out in notice from time to
time) and Tenant are named as insureds, and under which the insurer agrees to
indemnify and hold Overlandlord, Landlord and Landlord’s managing agent, and
those in privity of estate with Overlandlord, Landlord and Landlord’s managing
agent, harmless from and against all cost, expense and/or liability arising out
of or based upon any and all claims, accidents, injuries and damages mentioned
in Section 13.1 of this Article XIII., in the broadest form of such
coverage from time to time available in the jurisdiction in which the Premises
are located. Each such policy shall be non-cancelable and non-amendable with
respect to Overlandlord, Landlord and Overlandlord’s and Landlord’s said

 

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designees without thirty (30) days’ prior notice to Landlord, and a duplicate
original or certificate thereof shall be delivered to Landlord. As of the
Commencement Date hereof, the minimum limits of liability of such insurance
shall be as specified in Section 1.2 and from time to time during the
Lease Term for such higher limits, if any, as are carried customarily in the
Greater Boston Area with respect to similar properties, provided, however, that
in no event shall such limits be increased more frequently than once every five
(5) years or during the first five years of the term hereof. All insurance
required to be maintained by Tenant pursuant to this Lease shall be maintained
with responsible companies qualified to do business, and in good standing, in
the Commonwealth of Massachusetts and which have a rating of at least “A-” and
are within a financial size category of not less than “Class VIII” in the
most current Best’s Key Rating Guide or such similar rating as may be
reasonably selected by Landlord if such Guide is no longer published.

 

13.3         TENANT’S PROPERTY INSURANCE. Tenant, at Tenant’s expense, shall maintain
at all times during the Term of the Lease insurance against loss or damage
covered by the so-called “all risk” type insurance coverage with respect to Tenant’s
fixtures, equipment, goods, wares and merchandise, tenant improvements made by
or paid for by Tenant, and other property of Tenant (collectively “Tenant’s
Property”). Such insurance shall be in an amount at least equal to the full
replacement cost of Tenant’s Property.

 

13.4         NON-SUBROGATION. Any insurance carried by either party with
respect to the Premises or property therein or occurrences thereon shall, if it
can be so written without additional premium or with an additional premium
which the other party agrees to pay, include a clause or endorsement denying to
the insurer rights of subrogation against the other party to the extent rights
have been waived by the insured prior to occurrence of injury or loss. Each
party, notwithstanding any provisions of this Lease to the contrary, hereby
waives any rights of recovery against the other for injury or loss due to
hazards covered by such insurance to the extent of the indemnification received
thereunder. This waiver of rights by Tenant shall apply to, and be for the
benefit of, Landlord’s managing agent.

 

13.5         TENANT’S RISK. To the maximum extent that this agreement
may be made effective according to law, Tenant agrees to use and occupy the
Premises and to use such other portions of the Building, the Garage or the
Prudential Center as Tenant is herein given the right to use at Tenant’s own
risk; and neither Landlord nor Overlandlord shall have any responsibility or
liability for any loss of or damage to fixtures or other personal property of
Tenant, unless, subject to Section 13.4 hereof, such damage or loss is due
to the negligence or willful misconduct of Overlandlord, Landlord or either of
their agents, employees or contractors, in which case Landlord or Overlandlord,
as the case may be, shall bear loss or damage only to “ordinary office property”
(as hereinafter defined). For the

 

57

 

purpose of this Section 13.5, “ordinary office property” shall
mean merchandise, furniture, and other tangible personal property of the kind
and quantity which may customarily be expected to be found within comparable
business offices in the City of Boston, and excluding any unusually valuable or
exotic property, works of art, and the like.

 

ARTICLE XIV

FIRE, CASUALTY AND TAKING

 

14.1         REPAIR OF DAMAGE CAUSED BY CASUALTY. Unless the Lease is terminated pursuant to
the provisions of this Article XIV, if any portion of the Premises, the
Garage or the means of access thereto or egress therefrom, or covered access to
Boylston Street shall be damaged by fire or other casualty, Landlord shall
proceed with diligence, subject to the then applicable statutes, building
codes, zoning ordinances and regulations of any governmental authority, and at
the expense of Landlord, but only to the extent of the proceeds that are available
from the insurance Landlord is required to carry under this Lease or would have
been available if such insurance were obtained, to repair or cause to be
repaired such damage, including any damaged portion of the Tenant Improvement
Work, provided however, that all repairs to and replacements of Tenant’s
property and any other alterations, additions or improvements of Tenant (except
for the Tenant Improvement Work) shall be made by and at the expense of Tenant.
If the Premises or any part thereof shall have been rendered unfit for use and
occupation hereunder by reason of such damage, the Annual Fixed Rent, Additional
Rent and other charges or a just and proportionate part thereof, according to
the nature and extent to which the Premises shall have been so rendered unfit,
shall be suspended or abated until the Premises (except as to the property
which is to be repaired by or at the expense of Tenant) shall have been restored
as nearly as practicably may be to the condition in which they were in immediately
prior to such fire or other casualty. Landlord shall not be liable for delays
in the making of any such repairs nor shall Landlord be liable for any inconvenience
or annoyance to Tenant or injury to the business of Tenant resulting from
delays in repairing such damage.

 

14.2         LANDLORD’S TERMINATION RIGHTS.

 

If, after the Commencement Date, all or any portion of the Building is
damaged by fire or other casualty (i) at any time by an occurrence which
is not covered by the insurance Landlord is required to obtain under this Lease
and the cost to repair such damage exceeds five percent (5%) of the then fair
market value of the Building immediately before such casualty, or (ii) Landlord
elects to demolish the Building (whether or not Landlord elects to demolish the
Huntington Arcade) and terminate the leases for substantially all of the space
in the Building, or (iii) at any

 

58

 

time during the last eighteen (18) months of the term taking into
account any extension option term which has not lapsed unexercised, if Landlord
reasonably estimates that the time to repair such damage would exceed six (6) months
or (iv) such fire or casualty requires such substantial alteration or
reconstruction of the Building that the damage cannot, in the ordinary course,
reasonably be expected to be repaired within twelve (12) months from the date
of such fire or casualty as reasonably determined by Landlord and Landlord
terminates the leases for substantially all of the space in the Building, then,
in any such events, this Lease and the Term hereof may be terminated at the
election of Landlord by a notice in writing of its election so to terminate
which shall be given by Landlord to Tenant within sixty (60) days following
such fire or other casualty, the effective termination date of which shall be
not less than thirty (30) days alter the day on which such termination notice
is received by Tenant.

 

14.3         TENANT’S TERMINATION RIGHTS.

 

(A)          If any portion of the Premises or any portion of the Building shall be damaged
or destroyed by fire or other casualty to the extent that the operation of Tenant’s
business in the Premises in the normal course is materially adversely affected,
then, within sixty (60) days of such fire or other casualty, Landlord shall submit
to Tenant a reasonable engineering estimate as to the estimated length of time
to complete such repairs together with a statement of whether or not Landlord
will receive sufficient proceeds from insurance to repair such damage. If the
time period (“Estimated Restoration Period”) set forth in such estimate shall exceed
ten (10) months from the date of such casualty or if Landlord advises Tenant
in such notice that Landlord will not receive sufficient proceeds from insurance
to repair such damage, Tenant may elect, by a notice sent within sixty (60)
days after notice of such estimate is sent to Tenant, to terminate this Lease. If
such estimate shall fall within the ten (10) month limit and if Landlord
advises Tenant in such notice that Landlord will receive sufficient proceeds
from insurance to repair such damage, Tenant shall have no such right to
terminate pursuant to this Paragraph (A).

 

(B)           In the event that the Premises or the Building are damaged by fire or
other casualty to the extent that the operation of Tenant’s business in the
Premises in the normal course is materially adversely affected and the Lease is
not terminated by either Landlord or Tenant pursuant to Section 14.2 or
Paragraph (A) of this Section 14.3, and if Landlord shall fail to
substantially complete said repairs or restoration on or before the date (“Restoration
Deadline Date”) which is the greater of: (1) the end of the Estimated
Restoration Period and (2) ten (10) months after the date of such
fire or other casualty (which ten (10) month period shall be automatically
extended for up to an additional two (2) months for such periods of time
as Landlord is prevented from proceeding with or completing the same by reason
of matters beyond Landlord’s reasonable control) for any reason

 

59

 

other than Tenant’s fault, Tenant may terminate this Lease by giving
Landlord written notice as follows:

 

(i)            Said notice shall be given after the
Restoration Deadline Date.

 

(ii)           Said notice shall set forth an effective date
which is not earlier than thirty (30) days after Landlord receives said notice.

 

(iii)          If said repairs or restoration are
substantially complete on or before the date thirty (30) days (which
thirty-(30)-day period shall be extended by the length of any delays caused by
Tenant or Tenant’s contractors) after Landlord receives such notice, said
notice shall have no further force and effect.

 

(d)           If said repairs or restoration are not
substantially complete on or before the date thirty (30) days (which
thirty-(30)-day period shall be extended by the length of any delays caused by
Tenant or Tenant’s contractors) after Landlord receives such notice, the Lease
shall terminate as of said effective date.

 

14.4         GENERAL PROVISIONS RELATING TO ANY CASUALTY TERMINATION. In the event of any termination under this Article XIV,
this Lease and the Term hereof shall expire as of such effective termination
date as though that were the termination date of the Lease and the Annual Fixed
Rent, Additional Rent and other charges payable under this Lease shall be
apportioned as of such date.

 

14.5         RIGHTS OF TERMINATION FOR TAKING. If the Building, the Garage, or such
portion thereof or access thereto as to render the balance (if reconstructed to
the maximum extent practicable in the circumstances) unsuitable or inadequate
for Tenant’s purposes, shall be taken by condemnation or right of eminent
domain, Landlord or Tenant shall have the right to terminate this Lease by
notice to the other of its desire to do so, provided that such notice is given
not later than thirty (30) days after Tenant has been deprived of possession.
If either party shall give such notice, then this Lease shall terminate as of
the date of such notice with the same force and effect as if such date were the
date originally established as the expiration date hereof.

 

Further, if so much of the Building, the Garage, or access to either
shall be so taken that continued operation of the Building would be uneconomic,
Landlord shall have the right to terminate this Lease by giving notice to
Tenant of Landlord’s desire to do so not later than thirty (30) days after
Tenant has been deprived of possession of the Premises (or such portion thereof
as may be taken). If Landlord shall give such notice, then this Lease shall
terminate as of the date of

 

60

 

such notice with the same force and effect as if such date were the
date originally established as the expiration date hereof.

 

Should any part of the Premises be so taken or condemned during the
Lease Term hereof, and should this Lease not be terminated in accordance with
the foregoing provisions, and the holder of any mortgage which includes the
Premises as part of the mortgaged premises or any ground lessor of any ground
lease which includes the Premises as part of the demised premises allows the
net condemnation proceeds to be applied to the restoration of the Building,
Landlord agrees that after the determination of the net amount of condemnation
proceeds available to Landlord, Landlord shall use due diligence to put what
may remain of the Premises into proper condition for use and occupation as
nearly like the condition of the Premises prior to such taking as shall be
practicable (excluding Tenant’s Property). Notwithstanding the foregoing,
Landlord shall not be obligated to expend for such repair and restoration any
amount in excess of the net condemnation proceeds made available to it.

 

If the Premises shall be affected by any exercise of the power of
eminent domain and neither Landlord nor Tenant shall terminate this Lease as
provided above, then the Annual Fixed Rent, Additional Rent and other charges
due under the Lease shall be justly and equitably abated and reduced according
to the nature and extent of the loss of use thereof suffered by Tenant; and in
case of a taking which permanently reduces the Rentable Floor Area of the
Premises, a just proportion of the Annual Fixed Rent, Additional Rent and other
charges due under the Lease shall be abated for the remainder of the Lease
Term.

 

14.6         AWARD. Except as otherwise provided in this Section 14.6, Landlord
shall have and hereby reserves and excepts, and Tenant hereby grants and
assigns to Landlord, all rights to recover for damages to the Building, the
Prudential Center, and the Garage and the leasehold interest hereby created,
and compensation accrued or hereafter to accrue by reason of such taking,
damage or destruction, as aforesaid, and by way of confirming the foregoing,
Tenant hereby grants and assigns, and covenants with Landlord to grant and
assign to Landlord, all rights to such damages or compensation.

 

However, nothing contained herein shall be construed to prevent Tenant
from prosecuting in any such proceedings a claim for its trade fixtures so
taken or relocation, moving and other dislocation expenses, provided that such
action shall not affect the amount of compensation otherwise recoverable by
Landlord from the taking authority.

 

61

 

ARTICLE XV

DEFAULT

 

15.1         TENANTS DEFAULT. This Lease and the term of this Lease are
subject to the limitation that Tenant shall be in default if, at any time
during the Lease Term, any one or more of the following events (herein called
an “Event of Default” a “default of Tenant” or similar reference) shall occur
and not be cured prior to the expiration of the grace period (if any) herein
provided, as follows:

 

(a)           Tenant shall fail to pay any installment of
the Annual Fixed Rent, or any Additional Rent or any other monetary amount due
under this Lease on or before the date on which the same becomes due and
payable, and such failure continues for ten (10) days after notice from
Landlord thereof; or

 

(b)           Landlord having rightfully given the notice
specified in (a) above to Tenant twice in any twelve (12) month period,
Tenant shall fail thereafter to pay the Annual Fixed Rent, Additional Rent or
any other monetary amount due under this Lease on or before the date on which
the same becomes due and payable; or

 

(c)           Tenant shall fail to perform or observe some
term or condition of this Lease which, because of its character, would
immediately jeopardize Landlord’s interest (such as, but without limitation,
failure to maintain general liability insurance, or the employment of labor and
contractors within the Premises which interfere with Landlord’s work, in
violation of Section 4.3 or Section 9.3), and such failure continues
for five (5) days after notice from Landlord to Tenant thereof; or

 

(d)           Tenant shall fail to perform or observe any
other requirement, term, covenant or condition of this Lease (not hereinabove
in this Section 15.1 specifically referred to) on the part of Tenant to be
performed or observed and such failure shall continue for thirty (30) days
after notice thereof from Landlord to Tenant, or if said default shall
reasonably require longer than thirty (30) days to cure, if Tenant shall fail
to commence to cure said default within thirty (30) days after notice thereof
and/or fail to continuously prosecute the curing of the same to completion with
due diligence; or

 

(e)           The estate hereby created shall be taken on
execution or by other process of law; or

 

(f)            Tenant shall make an assignment or trust
mortgage arrangement, so-called, for the benefit of its creditors; or

 

62

 

(g)           Tenant shall judicially be declared bankrupt
or insolvent according to law; or

 

(h)           a receiver, guardian, conservator, trustee in
involuntary bankruptcy or other similar officer is appointed to take charge of
all or any substantial part of Tenant’s property by a court of competent
jurisdiction; or

 

(i)            any petition shall be filed against Tenant in
any court, whether or not pursuant to any statute of the United States or of
any State, in any bankruptcy, reorganization, composition, extension,
arrangement or insolvency proceeding, and such proceedings shall not be fully
and finally dismissed within sixty (60) days after the institution of the same;
or

 

(j)            Tenant shall file any petition in any court,
whether or not pursuant to any statute of the United States or any State, in
any bankruptcy, reorganization, composition, extension, arrangement or
insolvency proceeding; or

 

(k)           Tenant otherwise abandons or vacates the
Premises.

 

15.2         TERMINATION; RE-ENTRY. Upon the happening of any one or more of
the aforementioned Events of Default (notwithstanding any license of a former
breach of covenant or waiver of the benefit hereof or consent in a former
instance), Landlord or Landlord’s agents or servants may give to Tenant a notice
(hereinafter called “notice of termination”) terminating this Lease on a date
specified in such notice of termination (which shall be not less than five (5) days
after the date of the mailing of such notice of termination), and this Lease
and the Lease Term, as well as any and all of the right, title and interest of
the Tenant hereunder, shall wholly cease and expire on the date set forth in
such notice of termination (Tenant hereby waiving any rights of redemption) in
the same manner and with the same force and effect as if such date were the
date originally specified herein for the expiration of the Lease Term, and
Tenant shall then quit and surrender the Premises to Landlord.

 

In addition or as an alternative to the giving of such notice of
termination, Landlord or Landlord’s agents or servants may, by any suitable
action or proceeding at law, immediately or at any time thereafter re-enter the
Premises and remove therefrom Tenant, its agents, employees, servants,
licensees, and any subtenants and other persons, and all or any of its or their
property therefrom, and repossess and enjoy the Premises, together with all
additions, alterations and improvements thereto; but, in any event under this Section 15.2,
Tenant shall remain liable as hereinafter provided.

 

63

 

The words “re-enter” and “re-entry” as used throughout this Article XV
are not restricted to their technical legal meanings.

 

15.3         CONTINUED LIABILITY; RE-LETTING. If this Lease is terminated or if Landlord
shall re-enter the Premises as aforesaid, or in the event of the termination of
this Lease, or of re- entry, by or under any proceeding or action or any
provision of law by reason of an Event of Default hereunder on the part of Tenant,
Tenant covenants and agrees forthwith to pay and be liable for, on the days
originally fixed herein for the payment thereof, amounts equal to the several installments
of Annual Fixed Rent, all Additional Rent and other charges reserved as they
would, under the terms of this Lease, become due if this Lease had not been
terminated or if Landlord had not entered or re-entered, as aforesaid, and whether
the Premises be relet or remain vacant, in whole or in part, or for a period less
than the remainder of the Lease Term, or for the whole thereof, but, in the event
the Premises be relet by Landlord, Tenant shall be entitled to a credit in the net
amount of rent and other charges received by Landlord in reletting, after deduction
of all reasonable expenses incurred in reletting the Premises (including, without
limitation, remodeling costs, brokerage fees and the like), and in collecting
the rent in connection therewith, in the following manner:

 

Amounts received by Landlord after reletting shall first be applied
against such Landlord’s expenses, until the same are recovered, and until such
recovery, Tenant shall pay, as of each day when a payment would fall due under
this Lease, the amount which Tenant is obligated to pay under the terms of this
Lease (Tenant’s liability prior to any such reletting and such recovery not in
any way to be diminished as a result of the fact that such reletting might be
for a rent higher than the rent provided for in this Lease); when and if such
expenses have been completely recovered, the amounts received from reletting by
Landlord as have not previously been applied shall be credited against Tenant’s
obligations as of each day when a payment would fall due under this Lease, and
only the net amount thereof shall be payable by Tenant. Further, Tenant shall
not be entitled to any credit of any kind for any period after the date when
the term of this Lease is scheduled to expire according to its terms.

 

15.4         LIQUIDATED DAMAGES. Landlord may elect, as an alternative, to
have Tenant pay liquidated damages, which election may be made by notice given
to Tenant at any time after the termination of this Lease under Section 15.2,
above, and whether or not Landlord shall have collected any damages as
hereinbefore provided in this Article XV, and in lieu of all other such
damages beyond the date of such notice. Upon such notice, Tenant shall promptly
pay to Landlord, as liquidated damages, in addition to any damages collected or
due from Tenant from any period prior to such notice and all expenses which
Landlord may have incurred with respect to the collection of such damages, such
a sum as at the time of such notice represents the amount of the excess, if
any, of (a) the discounted

 

64

 

present value, at a discount rate of 6%, of the Annual Fixed Rent,
Additional Rent and other charges which would have been payable by Tenant under
this Lease for the remainder of the Lease Term if the Lease terms had been
fully complied with by Tenant, over and above (b) the discounted present
value, at a discount rate of 6%, of the Annual Fixed Rent, Additional Rent and
other charges that would be received by Landlord if the Premises were re-
leased at the time of such notice for the remainder of the Lease Term at the
fair market value (including provisions regarding periodic increases in Annual
Fixed Rent if such are applicable) prevailing at the time of such notice as reasonably
determined by Landlord.

 

For the purposes of this Article, if Landlord elects to require Tenant
to pay liquidated damages in accordance with this Section 15.4, the total
rent shall be computed by assuming the Tax Excess under Section 6.2 and
the Operating Cost Excess under Section 7.5 to be the same as were payable
for the twelve (12) calendar months (or if less than twelve (12) calendar
months have been elapsed since the date hereof, the partial year) immediately
preceding such termination of re-entry.

 

Nothing contained in this Lease shall limit or prejudice the right of
Landlord to prove for and obtain in proceedings for bankruptcy or insolvency by
reason of the termination of this Lease, an amount equal to the maximum allowed
by any statute or rule of law in effect at the time when, and governing
the proceeds in which, the damages are to be proved, whether or not the amount
be greater, equal to, or less than the amount of the loss or damages referred
to above.

 

15.5         WAIVER OF REDEMPTION. Tenant, for itself and any and all persons
claiming through or under Tenant, including its creditors, upon the termination
of this Lease and of the term of this Lease in accordance with the terms
hereof, or in the event of entry of judgment for the recovery of the possession
of the Premises in any action or proceeding, or if Landlord shall enter the
Premises by process of law or otherwise, hereby waives any right of redemption
provided or permitted by any statute, law or decision now or hereafter in
force, and does hereby waive, surrender and give up all rights or privileges
which it or they may or might have under and by reason of any present or future
law or decision, to redeem the Premises or for a continuation of this Lease for
the term of this Lease hereby demised after having been dispossessed or ejected
therefrom by process of law, or otherwise.

 

15.6         LANDLORD’S DEFAULT; TENANTS’S SELF-HELP. If a Landlord Default, as hereinafter
defined, shall occur, Tenant may, without the need of Landlord’s consent, if
Landlord fails to cure such Landlord Default within the Landlord Cure Period,
as hereinafter defined, perform the same for the account of Landlord. Landlord
shall, within thirty (30) days of demand therefor, reimburse Tenant the sums so
paid by Tenant in curing such Landlord Default, together with interest on

 

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such sums at the rate per annum set forth in Section 16.17 hereof
from the date of demand until the date of payment. However, in no event shall
Tenant have the right to offset against, withhold or deduct from Annual Fixed
Rent or Additional Rent payable under this Lease for any reason relating to
this Section 15.6. For the purposes of this Section 15.6, a “Landlord
Default” shall be defined as a failure by Landlord to perform Landlord’s
obligation to clean the Premises pursuant to Exhibit C and/or to perform
any of Landlord’s service, maintenance or repair obligations under the Lease,
excluding those maintenance and repair obligations, the cure or performance of
which would adversely affect any other tenant in the Building or the Prudential
Center (e.g., without limitation, Tenant shall have no right to perform any
maintenance or repairs to any common areas or facilities of the Prudential
Center). For the purposes of this Section 15.6, the “Landlord Cure Period”
shall be defined as follows:

 

(1)           In the event of an emergency threatening life
or property, or Tenant’s interest in this Lease, three (3) days after
receipt by Landlord of written notice from Tenant of such default. Notwithstanding
the foregoing, in the event that Landlord has commenced to cure such Landlord Default
within said three (3) day period, and so long as Landlord thereafter
diligently prosecutes such cure to completion, the three (3) day period
shall be extended to such period of time as Landlord reasonably requires to
cure such default;

 

(2)           In the event of any other Land lord Default,
thirty (30) days after receipt by Landlord of written notice from Tenant of
such Landlord Default. Notwithstanding the foregoing, in the event that
Landlord has commenced to cure such Landlord Default within said thirty (30)
day period, and so long as Landlord thereafter diligently prosecutes such cure
to completion, the thirty (30) day period shall be extended to such period of
time as Landlord reasonably requires to cure such default.

 

ARTICLE XVI

MISCELLANEOUS PROVISIONS

 

16.1         WAIVER. Failure on the part of Landlord or Tenant to complain of any action
or non-action on the part of the other, no matter how long the same may
continue, shall never be a waiver by Tenant or Landlord, respectively, of any
of its rights hereunder.

 

Further, no waiver at any time of any of the provisions hereof by
Landlord or Tenant shall be construed as a waiver of any of the other
provisions hereof, and a waiver at any time of any of the provisions hereof
shall not be construed as a

 

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waiver at any subsequent time of the same provisions. The consent or
approval of Landlord or Tenant to or of any action by the other requiring such
consent or approval shall not be construed to waive or render unnecessary
Landlord’s or Tenant’s consent or approval to or of any subsequent similar act
by the other.

 

No payment by Tenant, or acceptance by Landlord, of a lesser amount
than shall be due from Tenant to Landlord shall be treated otherwise than as a
payment on account. The acceptance by Landlord of a check for a lesser amount
with an endorsement or statement thereon, or upon any letter accompanying such
check, that such lesser amount is payment in full, shall be given no effect,
and Landlord may accept such check without prejudice to any other rights or
remedies which Landlord may have against Tenant. Further, the acceptance by
Landlord of Annual Fixed Rent, Additional Rent or any other charges paid by
Tenant under this Lease shall not be or be deemed to be a waiver by Landlord of
any default by Tenant, whether or not Landlord knows of such default, except
for such defaults as to which such payment relates.

 

16.2         CUMULATIVE REMEDIES. Except as expressly provided in this Lease,
the specific remedies to which Landlord and Tenant may resort under the terms
of this Lease are cumulative and are not intended to be exclusive of any other remedies
or means of redress which they may be lawfully entitled to seek in case of any
breach or threatened breach of any provisions of this Lease. In addition to the
other remedies provided in this Lease, Landlord shall be entitled to the restraint
by injunction of the violation or attempted or threatened violation of any of
the covenants, conditions or provisions of this Lease or to seek specific performance
of any such covenants, conditions or provisions, provided, however, that the
foregoing shall not be construed as a confession of judgment by Tenant.

 

16.3         QUIET ENJOYMENT. This Lease is subject and subordinate to
all matters of record including, without limitation, the Overlease. Landlord
agrees that, upon Tenant’s paying the Annual Fixed Rent, Additional Rent and
other charges herein reserved, and performing and observing the covenants,
conditions and agreements hereof upon the part of Tenant to be performed and
observed, Tenant shall and may peaceably hold and enjoy the Premises during the
term of this Lease, without interruption or disturbance from Landlord or
persons claiming through or under Landlord, subject, however, to the terms of
this Lease. This covenant shall be construed as running with the land to and
against subsequent owners and successors in interest, and is not, nor shall it
operate or be construed as, a personal covenant of Landlord, except to the
extent of the Landlord’s interest in the Premises, and this covenant and any
and all other covenants of Landlord contained in this Lease shall be binding
upon Landlord and upon such subsequent owners or successors in interest of
Landlord’s interest under this Lease, including ground or master lessees, to
the extent of their respective interests, as and when they shall acquire same
and then only for so long as they shall retain such interest.

 

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16.4         SURRENDER. (A) No act or thing done by Landlord during the Lease Term shall
be deemed an acceptance of a surrender of the Premises, and no agreement to
accept such surrender shall be valid, unless in writing signed by Landlord. No employee
of Landlord or of Landlord’s agents shall have any power to accept the keys of
the Premises as an acceptance of a surrender of the Premises prior to the termination
of this Lease; provided, however, that the foregoing shall not apply to the
delivery of keys to Landlord or its agents in its (or their) capacity as
managing agent or for purpose of emergency access. In any event, however, the
delivery of keys to any employee of Landlord or of Landlord’s agents shall not
operate as a termination of the Lease or a surrender of the Premises.

 

(B)           Upon the expiration or earlier termination of the Lease Term, Tenant
shall surrender the Premises to Landlord in the condition as required by
Sections 8.1 and 9.5, first removing all goods and effects of Tenant and
completing such other removals as may be permitted or required pursuant to Section 9.5.

 

16.5         BROKERAGE. Tenant warrants and represents that Tenant has not dealt with any
broker in connection with the consummation of this Lease other than the broker,
person or firm designated in Section 1.2 hereof; and in the event any
claim is made against the Landlord relative to dealings with brokers other than
the broker designated in Section 1.2 hereof, Tenant shall defend the claim
against Landlord with counsel of Landlord’s selection and save harmless and
indemnify Landlord on account of loss, cost or damage which may arise by reason
of such claim. Landlord agrees that it shall be solely responsible for the
payment of brokerage commissions to the broker, person or firm designated in Section 1.2
hereof.

 

Landlord warrants and represents that Landlord has not dealt with any
broker in connection with the consummation of this Lease other than the broker,
person or firm designated in Section 1.2 hereof; and in the event any
claim is made against the Tenant relative to Landlord’s dealings with brokers
other than the broker designated in Section 1.2 hereof, Landlord shall
defend the claim against Tenant with counsel of Tenant’s selection and save
harmless and indemnify Tenant on account of loss, cost or damage which may arise
by reason of such claim.

 

16.6         INVALIDITY OF PARTICULAR PROVISIONS. If any
term or provision of this Lease, or the application thereof to any person or
circumstance shall, to any extent, be invalid or unenforceable, the remainder
of this Lease, or the application of such term or provision to persons or
circumstances other than those as to which it is held invalid or unenforceable,
shall not be affected thereby, and each term and provision of this Lease shall
be valid and be enforced to the fullest extent permitted by law.

 

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16.7         PROVISIONS BINDING, ETC. The
obligations of this Lease shall run with the land, and except as herein
otherwise provided, the terms hereof shall be binding upon and shall inure to
the benefit of the successors and assigns, respectively, of Landlord and Tenant
and, if Tenant shall be an individual, upon and to his heirs, executors,
administrators, successors and assigns. Each term and each provision of this
Lease to be performed by Tenant shall be construed to be both a covenant and a
condition. The reference contained to successors and assigns of Tenant is not
intended to constitute a consent to assignment by Tenant, but has reference only
to those instances in which Landlord may have later given consent to a particular
assignment as required by the provisions of Article XII hereof.

 

16.8         RECORDING. Each of Landlord and Tenant agree not to record the within Lease, but
each party hereto agrees, on the request of the other, to execute a so- called
Notice of Lease or short form lease in form recordable and complying with applicable
law and reasonably satisfactory to Landlord’s and Tenant’s attorneys. In no
event shall such document set forth the rent or other charges payable by Tenant
under this Lease; and any such document shall expressly state that it is executed
pursuant to the provisions contained in this Lease, and is not intended to vary
the terms and conditions of this Lease.

 

16.9         NOTICES AND TIME FOR ACTION. Whenever, by the terms of this Lease, notice
shall or may be given either to Landlord or to Tenant, such notices shall be in
writing and shall be sent by hand, registered or certified mail, or by
overnight or other commercial courier which obtains a receipt for delivery,
postage or delivery charges, as the case may be, prepaid as follows:

 

If intended for Landlord, addressed to Landlord at the address set
forth on the first page of this Lease (or to such other address or
addresses as may from time to time hereafter be designated by Landlord by like
notice).

 

If intended for Tenant, addressed to Tenant at the address set forth on
the first page of this Lease except that from and after the Commencement
Date the address of Tenant shall be the Premises with a copy to Schnader, Harrison,
Goldstein & Manello, 265 Franklin Street, Boston, Massachusetts 02110-3192,
Attn: Andrew M. Pearlstein, Esq. (or to such other address or addresses as
may from time to time hereafter be designated by Tenant by like notice).

 

Except as otherwise provided herein, all such notices shall be
effective when received; provided, that (i) if receipt is refused, notice
shall be effective upon the first occasion that such receipt is refused or (ii) if
the notice is unable to be

 

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delivered due to a change of address of which no notice was given,
notice shall be effective upon the date such delivery was attempted.

 

Where provision is made for the attention of an individual or
department, the notice shall be effective only if the wrapper in which such
notice is sent is addressed to the attention of such individual or department.

 

Any notice given by an attorney on behalf of Landlord or by Landlord’s
managing agent shall be considered as given by Landlord and shall be fully
effective.

 

Time is of the essence with respect to any and all notices and periods
for giving of notice or taking any action thereto under this Lease.

 

16.10       WHEN LEASE BECOMES BINDING. Employees or agents of Landlord have no
authority to make or agree to make a lease or any other agreement or undertaking
in connection herewith. The submission of this document for examination and
negotiation does not constitute an offer to lease, or a reservation of, or
option for, the Premises, and this document shall become effective and binding
only upon the execution and delivery hereof by both Landlord and Tenant. All
negotiations, considerations, representations and understandings between
Landlord and Tenant are incorporated herein and may be modified or altered only
by written agreement between Landlord and Tenant, and no act or omission of any
employee or agent of Landlord shall alter, change or modify any of the
provisions hereof.

 

16.11       PARAGRAPH HEADINGS. The paragraph headings throughout this
instrument are for convenience and reference only, and the words contained
therein shall in no way be held to explain, modify, amplify or aid in the
interpretation, construction or meaning of the provisions of this Lease.

 

16.12       RIGHTS OF MORTGAGEE. This Lease shall be subject and subordinate
to any mortgage now or hereafter on the Overlease Premises or the Building, or
both, or any part thereof, and to all renewals, modifications, consolidations,
replacements and extensions thereof and all substitutions therefor, provided
that, unless such mortgage provides by its terms that it is subordinate to this
Lease, Landlord shall cause the holder of such mortgage to agree, by a written
instrument in the customary form of such mortgagee, with such commercially
reasonable changes as Tenant and such mortgagee agree upon, to recognize the
right of Tenant to use and occupy the Premises upon the payment of rent and
other charges payable by Tenant under this Lease and the performance by Tenant
of Tenant’s obligations hereunder. In confirmation of such subordination and
recognition, Tenant shall execute and deliver promptly such instruments of
subordination as such mortgagee may reasonably request, subject to the delivery
by such mortgagee of the recognition agreement described in the immediately
preceding sentence. In

 

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the event that any mortgagee or its respective successor in title shall
succeed to the interest of Landlord, then this Lease shall nevertheless
continue in full force and effect and Tenant shall and does hereby agree to
attorn to such mortgagee or successor and to recognize such mortgagee or
successor as its landlord. If any holder of a mortgage which includes the
Premises, executed and recorded prior to the Date of this Lease, shall so
elect, this Lease, and the rights of Tenant hereunder, shall be superior in
right to the rights of such holder, with the same force and effect as if this
Lease had been executed, delivered and recorded, or a statutory Notice hereof
recorded, prior to the execution, delivery and recording of any such mortgage.
The election of any such holder shall become effective upon either notice from
such holder to Tenant in the same fashion as notices from Landlord to Tenant
are to be given hereunder or by the recording in the appropriate registry or
recorder’s office of an instrument in which such holder subordinates its rights
under such mortgage to this Lease. Reference is hereby made to a certain
Subordination of Mortgage and Security Agreement dated September 24, 1999
and recorded with the Suffolk County Registry of Deeds at Book 24257, Page 258
whereby the mortgage granted by the landlord under the Overlease has been
subordinated to the Overlease.

 

16.13       RIGHTS OF GROUND LESSOR. If Landlord’s interest, in property
(whether land only or land and buildings) which includes the Premises is
acquired by another party and simultaneously leased back to Landlord herein,
the holder of the ground lessor’s interest in such lease shall enter into a
recognition agreement with Tenant simultaneously with the sale and leaseback,
wherein the ground lessor will agree to recognize the right of Tenant to use
and occupy the Premises upon the payment of Annual Fixed Rent, Additional Rent
and other charges payable by Tenant under this Lease and the performance by
Tenant of Tenant’s obligations hereunder, and wherein Tenant shall agree to
attorn to such ground lessor as its Landlord and to perform and observe all of
the tenant obligations hereunder, in the event such ground lessor succeeds to
the interest of Landlord hereunder under such ground lease.

 

16.14       NOTICE TO MORTGAGEE AND GROUND LESSOR. After receiving notice from any person,
firm or other entity that it holds a mortgage which includes the Premises as
part of the mortgaged premises, or that it is the ground lessor under a lease
with Landlord as ground lessee, which includes the Premises as a part of the leased
premises (including the Overlease), no notice from Tenant to Landlord shall be
effective unless and until a copy of the same is given to such holder or ground
lessor at the address as specified in said notice (as it may from time to time
be changed), and the curing of any of Landlord’s defaults by such holder or ground
lessor within a reasonable time after such notice (including a reasonable time
to obtain possession of the premises if the mortgagee or ground lessor elects to
do so) shall be treated as performance by Landlord. For the purposes of this Section 16.14,
the term “mortgage” includes a mortgage on a leasehold interest of

 

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Landlord (but not one on Tenant’s leasehold interest). If any mortgage
is listed on Exhibit H then the same shall constitute notice from the
holder of such mortgage for the purposes of this Section 16.14.

 

16.15       ASSIGNMENT OF RENTS. With reference to any assignment by
Landlord of Landlord’s interest in this Lease, or the rents payable hereunder,
conditional in nature or otherwise, which assignment is made to the holder of a
mortgage or ground lease on property which includes the Premises, Tenant
agrees:

 

(a)           That the execution thereof by Landlord, and
the acceptance thereof by the holder of such mortgage, or the ground lessor,
shall never be treated as an assumption by such holder or ground lessor of any
of the obligations of Landlord hereunder, unless such holder, or ground lessor,
shall, by notice sent to Tenant, specifically otherwise elect; and

 

(b)           That, except as aforesaid, such holder or
ground lessor shall be treated as having assumed Landlord’s obligations
hereunder only upon foreclosure of such holder’s mortgage and the taking of
possession of the Premises, or, in the case of a ground lessor, the assumption
of Landlord’s position hereunder by such ground lessor. In no event shall the
acquisition of title to the Building and the land on which the same is located
by a purchaser which, simultaneously therewith, leases the entire Building or
such land back to the seller thereof be treated as an assumption, by operation
of law or otherwise, of Landlord’s obligations hereunder, but Tenant shall look
solely to such seller-lessee, and its successors from time to time in title,
for performance of Landlord’s obligations hereunder. In any such event, this Lease
shall be subject and subordinate to the lease to such purchaser provided that
such purchaser-lessor agrees to recognize the right of Tenant to use and occupy
the Premises upon the payment of rent and all other charges payable by Tenant
under this Lease and the performance by Tenant of Tenant’s obligations under
this Lease. For all purposes, such seller-lessee, and its successors in title,
shall be the landlord hereunder unless and until Landlord’s position shall have
been assumed by such purchaser-lessor. In addition, (i) no rent payable under
this Lease or under any sublease made by Tenant may be based in whole or in
part on the income or profits derived from the Premises or any subleased
premises except for percentage rent based on gross (not net) receipts or sales;
(ii) if any lender succeeds to the Landlord’s interests under this Lease
and is advised by its counsel that all or any portion of the rent payable under
this Lease is or may be deemed to be unrelated business income within the meaning
of the Internal Revenue Code of the 1986, as amended, or the regulations issued
thereunder, such lender may elect to amend unilaterally the calculation of
rents under this Lease so that none of the rents payable to lender under this
Lease will constitute unrelated business income,

 

72

 

provided that such amendment will not increase the Tenant’s payment
obligations or other liability under this Lease or reduce the Landlord’s
obligations under this Lease; and (iii) if such lender requests, Tenant
will be obligated to execute any document lender may deem necessary to effect
the amendment of this Lease in accordance with the foregoing subsection (ii).
Further, no Annual Fixed Rent or Additional Rent may be paid by Tenant more
than thirty (30) days in advance except with such lender’s prior written
consent, and any such payment without such consent shall not be binding on
lender.

 

16.16       STATUS REPORT AND FINANCIAL STATEMENTS. Recognizing that Landlord may find it
necessary to establish to third parties, such as accountants, banks, potential
or existing mortgagees, potential purchasers or the like, the then current
status of performance hereunder, Tenant, within ten (10) days after the request
of Landlord made from time to time, will furnish to Landlord, or any existing
or potential holder of any mortgage encumbering the Premises, the Building or
the Prudential Center, or any potential purchaser of the Premises, the Building,
or the Prudential Center (each an “Interested Party”) a statement of the status
of any matter pertaining to this Lease, including, without limitation, acknowledgments
that (or the extent to which) each party is in compliance with its obligations
under the terms of this Lease. In addition, Tenant shall deliver to Landlord,
or any Interested Party designated by Landlord, financial statements of Tenant,
and any guarantor of Tenant’s obligations under this Lease, as reasonably requested
by Landlord including, but not limited to, financial statements for the past
three (3) years, provided that (i) in no event shall Landlord request
such statements more often than one (1) time per calendar year, and (ii) such
statements shall be requested by Landlord only in connection with a sale or
financing of the Building or Landlord’s interest in the Overlease. Such
financial statements shall be treated as confidential and may be disclosed only
(i) as required by court order, (ii) to prospective purchasers and
lenders and to financial advisors, investment bankers, lawyers and accountants,
(iii) as may be required by Legal Requirements, or (iv) in connection
with litigation between the parties. Any such status statement or financial
statement delivered by Tenant pursuant to this Section 16.16 may be relied
upon by any Interested Party. Any such status statement or financial statement
delivered by Tenant pursuant to this Section 16.16 may be relied upon by
any Interested Party.

 

16.17       SELF-HELP. If Tenant shall at any time fail to make any payment or perform any
act which Tenant is obligated to make or perform under this Lease and (except
in the case of emergency) if the same continues unpaid or unperformed beyond
applicable grace periods, then Landlord may, but shall not be obligated so to
do, after ten (10) days’ notice to and demand upon Tenant, or without
notice to or demand upon Tenant in the case of any emergency, and without
waiving, or releasing Tenant from, any obligations of Tenant in this Lease
contained, make

 

73

 

such payment or perform such act which Tenant is obligated to perform
under this Lease in such manner and to such extent as may be reasonably
necessary, and, in exercising any such rights, pay any costs and expenses,
employ counsel and incur and pay reasonable attorneys’ fees. All sums so paid
by Landlord and all reasonable and necessary costs and expenses of Landlord
incidental thereto, together with interest thereon at the annual rate equal to
the sum of (a) the Base Rate from time to time announced by BankBoston,
N.A. or its successor as its Base Rate and (b) two percent (2%) (but in no
event greater than the maximum rate permitted by applicable law), from the date
of the making of such expenditures by Landlord, shall be deemed to be
Additional Rent and, except as otherwise in this Lease expressly provided,
shall be payable to the Landlord on demand, and if not promptly paid shall be
added to any rent then due or thereafter becoming due under this Lease, and
Tenant covenants to pay any such sum or sums with interest as aforesaid, and
Landlord shall have (in addition to any other right or remedy of Landlord) the
same rights and remedies in the event of the non-payment thereof by Tenant as
in the case of default by Tenant in the payment of Annual Fixed Rent.

 

16.18       HOLDING OVER. Any holding over by Tenant after the
expiration of the Term of this Lease shall be treated as a tenancy at
sufferance and shall be on the terms and conditions as set forth in this Lease,
as far as applicable except that Tenant shall pay as a use and occupancy charge
an amount equal to the greater of (x) the Annual Fixed Rent and charges for
electricity and Operating Expenses, calculated (on a daily basis) at the
highest rate payable under the terms of this Lease (the “Holdover Multiplied
Expenses”), multiplied by 150%, plus 100% of all Additional Rent not included
in the Holdover Multiplied Expenses, or (y) the fair market rental value of the
Premises, in each case for the period measured from the day on which Tenant’s
hold-over commences and terminating on the day on which Tenant vacates the
Premises. Notwithstanding the foregoing, if such holding over continues for
more than sixty (60) days, effective as of the sixty-first (61st) day, holdover
rent shall increase to the greater of (x) 200% of the Holdover Multiplied
Expenses due for the period immediately preceding such holding over, plus 100%
of all Additional Rent not included in the Holdover Multiplied Expenses, or (y)
the fair market rental value of the Premises. In addition, if Tenant holds over
for sixty (60) days or more, Tenant shall save Landlord, its agents and
employees harmless and will exonerate, defend and indemnify Landlord, its
agents and employees from and against any and all damages (including, without
limitation, reasonable attorneys’ fees) which Landlord may actually suffer by
reason of any holdover by Tenant following such 60-day period (“Holdover
Damages”). Nothing in the foregoing nor any other term or provision of this
Lease shall be deemed to permit Tenant to retain possession of the Premises or
hold over in the Premises after the expiration or earlier termination of the
Lease Term. All property which remains in the Building or the Premises (i) after
the expiration of this Lease or (ii) for more than ten (10) days
after the early

 

74

 

termination of this Lease shall, in either case, be conclusively deemed
to be abandoned and may either be retained by Landlord as its property or sold
or otherwise disposed of in such manner as Landlord may see fit. If any part
thereof shall be sold, then Landlord may receive the proceeds of such sale and
apply the same, at its option against the expenses of the sale, the cost of
moving and storage, any arrears of rent or other charges payable hereunder by
Tenant to Landlord and any damages to which Landlord may be entitled under this
Lease and at law and in equity.

 

16.19       ENTRY BY LANDLORD. Landlord, and its duly authorized
representatives, shall, upon reasonable prior notice (except in the case of
emergency), have the right to enter the Premises at all reasonable times
(except at any time in the case of emergency) for the purposes of inspecting
the condition of same and making such repairs, alterations, additions or
improvements thereto as may be necessary if Tenant fails to do so as required
hereunder (but the Landlord shall have no duty whatsoever to make any such
inspections, repairs, alterations, additions or improvements except as
otherwise provided in Sections 4.1, 4.3, 7.1 and 7.2), and, upon reasonable
advance notice to Tenant, to show the Premises to prospective tenants during
the twelve (12) months preceding expiration of the term of this Lease as it may
have been extended and at any reasonable time during the Lease Term to show the
Premises to prospective purchasers and mortgagees. Landlord acknowledges that
because of the nature of the Tenant’s operation, certain limited areas of the
Premises require special security arrangements, and in that regard, the Landlord
and its agents shall not make entry into such areas unless accompanied by a
representative of Tenant provided that: (i) Landlord and its agents may
make such entry in the case of an emergency or where such a representative is
not provided by Tenant after timely notice and (ii) Landlord shall not be
required to abide by the special security provisions unless Tenant shall have
notified Landlord in writing as to the special areas. Upon reasonable advance
notice to Landlord, Tenant may change the location of such areas.

 

16.20       TENANT’S PAYMENTS. Each and every payment and expenditure,
other than Annual Fixed Rent, shall be deemed to be Additional Rent hereunder,
whether or not the provisions requiring payment of such amounts specifically so
state, and shall be payable, unless otherwise provided in this Lease, within
ten (10) days after written demand by Landlord, and in the case of the
non-payment of any such amount, Landlord shall have, in addition to all of its
other rights and remedies, all the rights and remedies available to Landlord
hereunder or by law in the case of non-payment of Annual Fixed Rent. Unless
expressly otherwise provided in this Lease, the performance and observance by
Tenant of all the terms, covenants and conditions of this Lease to be performed
and observed by Tenant shall be at Tenant’s sole cost and expense. If Tenant
has not objected to any statement of Additional Rent which is rendered by
Landlord to Tenant within ninety (90) days after Landlord has rendered the same
to Tenant, then the same shall be deemed to

 

75

 

be a final account between Landlord and Tenant not subject to any
further dispute. In the event that Tenant shall seek Landlord’s consent or
approval under this Lease, then Tenant shall reimburse Landlord, upon demand,
as Additional Rent, for all reasonable costs and expenses, including legal and
architectural costs and expenses, incurred by Landlord in processing such
request, whether or not such consent or approval shall be given.

 

16.21       LATE PAYMENT. If any payment or installment of Annual Fixed
Rent or Additional Rent or other amount due hereunder is not paid within ten (10) days
after the date (the “Due Date”) on which the same first becomes payable under this
Lease, the amount of such payment or installment shall bear interest from the Due
Date through and including the date such payment or installment is received by
Landlord, at a rate equal to the lesser of (i) the rate announced by Fleet
National Bank (or its successor) from time to time as its prime or base rate
(or if such rate is no longer available, a comparable rate reasonably selected
by Landlord), plus two percent (2%), or (ii) the maximum applicable legal
rate, if any. Such interest shall be deemed Additional Rent and shall be paid
by Tenant to Landlord upon demand.

 

16.22       COUNTERPARTS. This Lease may be executed in several
counterparts, each of which shall be deemed an original, and such counterparts
shall constitute but one and the same instrument.

 

16.23       ENTIRE AGREEMENT. This Lease constitutes the entire agreement
between the parties hereto, Landlord’s managing agent and their respective
affiliates with respect to the subject matter hereof and thereof and supersedes
all prior dealings between them with respect to such subject matter, and there
are no verbal or collateral understandings, agreements, representations or
warranties not expressly set forth in this Lease. No subsequent alteration,
amendment, change or addition to this Lease shall be binding upon Landlord or
Tenant, unless reduced to writing and signed by the party or parties to be
charged therewith.

 

16.24       LANDLORD LIABILITY. Tenant shall neither assert nor seek to
enforce any claim for breach of this Lease against any of Landlord’s assets
other than Landlord’s interest in the Building, and the uncollected rents,
issues and profits therein, and, subject to the rights of any mortgagee of
Landlord and of Landlord to use such proceeds or awards for reconstruction, the
insurance proceeds and taking awards therefor, Tenant agrees to look solely to
such interest for the satisfaction of any liability of Landlord under this
Lease, it being specifically agreed that neither Landlord, nor any successor
holder of Landlord’s interest hereunder, nor any beneficiary of any Trust of
which any person from time to time holding Landlord’s interest is Trustee, nor
any such Trustee, nor any member, manager, partner, director or stockholder nor
Landlord’s managing agent shall ever be personally liable for any such
liability. This paragraph shall not limit any right

 

76

 

that Tenant might otherwise have to obtain injunctive relief against
Landlord or Landlord’s successors-in-interest, or to take any other action
which shall not involve the personal liability of Landlord, or of any successor
holder of Landlord’s interest hereunder, or of any beneficiary of any trust of
which any person from time to time holding Landlord’s interest is Trustee, or
of any such Trustee, or of any manager, member, partner, director or
stockholder of Landlord or of Landlord’s managing agent, to respond in monetary
damages from Landlord’s assets other than Landlord’s interest in said Building,
as aforesaid. In no event shall Landlord ever be liable for any indirect or
consequential damages or loss of profits or the like. In the event that
Landlord shall be determined to have wrongfully withheld any consent or
approval under this Lease, the sole recourse and remedy of the Tenant in
respect thereof shall be to specifically enforce Landlord’s obligation to grant
such consent or approval, and in no event shall the Landlord be responsible for
any damages of whatever nature in respect of its failure to give such consent
or approval nor shall the same otherwise affect the obligations of the Tenant
under this Lease or act as any termination of this Lease. Tenant shall not be
liable for any indirect or consequential damages or loss of profits or the like
except as set forth in Section 16.18 in the case where Tenant holds over
in the Premises after the expiration or earlier termination of this Lease, as
the case may be.

 

16.25       NO PARTNERSHIP. The relationship of the parties hereto is
that of landlord and tenant and no partnership, joint venture or participation
is hereby created.

 

16.26       SECURITY DEPOSIT. Intentionally omitted.

 

16.27       GOVERNING LAW. This Lease shall be governed exclusively by
the provisions hereof and by the law of The Commonwealth of Massachusetts, as
the same may from time to time exist.

 

16.28       SIGNAGE.

 

(A)          Landlord shall provide building standard signage in the standard graphics
for the Building listing Tenant’s names and the names of Tenant’s “key” employees
on the primary directory(ies) for the Building. If the building directory is an
electronic directory there shall be no limit on the number of names of Tenant’s
key employees which may be listed, but if it is not an electronic directory,
then the number of employees listed will not exceed twenty-five. The initial
listing of Tenant’s name and the names of Tenant’s “key” employees shall be at
Landlord’s expense. Any changes or additions to such

directory(ies) shall be at Tenant’s cost and expense.

 

(B)           If Landlord elects to erect a monument sign in the lobby area or inside
the galleria/arcade of the Building, without having any obligation to do so,
Tenant

 

77

 

shall have the right, at Tenant’s cost and expense, to include Tenant’s
name on such monument sign in building standard graphics.

 

16.29       ANTENNA AREA. Tenant shall have the right to use the
Antenna Area, as hereinafter defined, to install one (1) satellite dish
antenna (“Antenna”) for a period commencing as of the date that Tenant installs
the Antenna, as hereinafter defined, in the Antenna Area (“Commencement Date in
respect of the Antenna Area”) and terminating as of the last day of the Term,
as such Term may be extended. The “Antenna Area” shall be an area on the roof
of the Building designated by Landlord or, at Landlord’s election, an area on
the roof of the Prudential Tower building designated by Landlord.

 

(A)          The Annual Fixed Rent in respect of the Antenna Area shall be the Fair Market
Rental Value of the Antenna Area as of the Commencement Date in respect of the
Antenna Area based upon comparable satellite dish antennas on roofs of other
buildings in the Prudential Center as determined by Landlord in Landlord’s
reasonable discretion.

 

(B)           Tenant shall have no obligation to pay Operating Expense Excess in respect
of the Antenna Area.

 

(C)           Landlord shall have no obligation to provide any services to the
Antenna Area.

 

(D)          Tenant shall have no right to make any changes, alterations, signs, decoration,
or other improvements (which changes, alterations, signs, decoration or other
improvements, together with the Antenna, are hereby collectively referred to as
“Rooftop Installations”) to the Antenna Area or to the Antenna without Landlord’s
prior written consent, which consent Landlord may hold it its sole discretion.

 

(E)           Tenant shall have no right of access to the roof of the Building unless
Tenant has given Landlord reasonable advance notice and unless Tenant’s representatives
are accompanied by a representative of Landlord. Landlord shall provide Tenant
with 24-hour access to the Antenna Area, subject to Landlord’s reasonable
security procedures and restrictions based on emergency conditions and to other
causes beyond Landlord’s reasonable control. Tenant shall give Landlord
reasonable advance written notice of the need for access to the Antenna Area
(except that such notice may be oral in an emergency), and Landlord must be present
during any entry by Tenant onto the Antenna Area. Each notice for access shall
be in the form of a work order referencing the lease and describing, as applicable,
the date access is needed, the name of the contractor or other personnel requiring
access, the name of the supervisor authorizing the access/work, the areas to
which access is required, the Building common elements to be impacted (risers,

 

78

 

electrical rooms, etc.) and the description of new equipment or other
Rooftop Installations to be installed and evidence of Landlord’s approval
thereof. In the event of an emergency, such notice shall follow within five (5) days
after access to the Antenna Area.

 

(F)           At the expiration or prior termination of Tenant’s right to use the
Antenna Area, Tenant shall remove all Installations (including, without
limitation, the Antenna) from the Antenna Area.

 

(G)           Tenant shall be responsible for maintaining the Rooftop Installations
and for the cost of repairing any damage to the roof of the Building caused by
the installation, operation or removal of any Rooftop Installations. Tenant
shall operate the Rooftop Installations in a manner which shall not interfere
with other equipment on the Building or on other buildings in the Prudential
Center.

 

(H)          Tenant shall have no right to sublet the Antenna Area.

 

(I)            No other person, firm or entity (including,
without limitation, other tenants, licensees or occupants of the Building)
shall have the right to benefit from the services provided by the Antenna other
than Tenant.

 

(J)            In the event that Landlord performs repairs
to or replacement of the roof, Tenant shall, at Tenant’s cost, remove the
Antenna until such time as Landlord has completed such repairs or replacements.
Tenant recognizes that there may be an interference with Tenant’s use of the
Antenna in connection with such work. Landlord shall use reasonable efforts to
complete such work as promptly as possible and to perform such work in a manner
which will minimize or, if reasonably possible, eliminate any interruption in
Tenant’s use of the Antenna.

 

(K)          Any services required by Tenant in connection with Tenant’s use of the
Antenna Area or the Antenna shall be installed by Tenant, at Tenant’s expense,
subject to Landlord’s prior approval.

 

(L)           To the maximum extent permitted by law, all Rooftop Installations in
the Antenna Area shall be at the sole risk of Tenant, and Landlord shall have
no liability to Tenant in the event that any Rooftop Installations are damaged
for any reason.

 

(M)         Tenant shall take the Antenna Area “as-is” in the condition in which
the Antenna Area is in as of the Commencement Date in respect of the Antenna
Area.

 

(N)          Tenant shall comply with all applicable Legal
Requirements and Insurance Requirements in Tenant’s use of the Antenna Area and
the Antenna.

 

79

 

(O)          Landlord shall have the right, upon thirty (30) days notice to Tenant,
to require Tenant to relocate the Antenna Area to another area (“Relocated
Rooftop Area”) on the roof of the Building (or the Prudential Tower, at
Landlord’s election) suitable for the use of the Rooftop Installations. In such
event, Tenant shall at Landlord’s cost and expense, on or before the thirtieth
(30th) day after Landlord gives such notice, relocate all of its
Rooftop Installations from the Antenna Area to the Relocation Rooftop Area.

 

(P)           In addition to complying with the applicable construction provisions of
the Lease, Tenant shall not install or operate Rooftop Installations in any
portion of the Antenna Area until (x) Tenant shall have obtained Landlord’s
prior written approval of Tenant’s plans and specifications for the placement
and installation of the Rooftop Installations in the Antenna Area (including, without
limitation, as to size and aesthetics of such Rooftop Installations and the
architectural compatibility and relationship between such Rooftop Installations
and the general area of the Building and neighboring buildings), and (y) Tenant
shall have obtained and delivered to Landlord copies of all required
governmental and quasi-governmental permits, approvals, licenses and
authorizations necessary for the lawful installation, operation and maintenance
of the Rooftop Installations. The parties hereby acknowledge and agree, by way
of illustration and not limitation, that Landlord shall have the right to
withhold its approval of Tenant’s plans and specifications hereunder, and shall
not be deemed to be unreasonable in doing so, if Tenant’s intended placement or
method of installation or operation of the Rooftop Installations (i) may
subject other licensees, tenants or occupants of the building, or other
surrounding or neighboring landowners or their occupants, to signal
interference, Tenant hereby acknowledging that a shield may be required in
order to prevent such interference, tenant hereby acknowledging that a shield
may be required in order to prevent such interference, (ii) does not
minimize to the fullest extent practicable the obstruction of the views from
the windows of the Building that are adjacent to the Rooftop Installations, if
any, (iii) does not complement (in Landlord’s sole judgment, which shall
not, however, require Tenant to insure unreasonable expense) the design and
finish of the Building, (iv) may damage the structural integrity of the
Building or the roof thereof, or (v) may constitute a violation of any
consent, approval, permit or authorization necessary for the lawful
installation of the Rooftop Installations.

 

(Q)          In addition to the indemnification provisions set forth in the Lease
which shall be applicable to the Antenna Area, Tenant shall, to the maximum
extent permitted by law, indemnify, defend, and hold Landlord, its agents,
contractors and employees harmless from any and all claims, losses, demands,
actions or causes or actions suffered by any person, firm, corporation, or
other entity arising from Tenant’s use of the Antenna Area.

 

80

 

(R)           Landlord shall have the right to designate or identify the Rooftop
Installations with or by a lease or license number (or other marking) and to
place such number (or marking) on or near such Rooftop Installations.

 

(S)           Tenant recognizes that Landlord may wish to (and Landlord hereby
reserves the right to) install a central Building system (the “Central Building
System”) capable of, among other things, providing Tenant with the type of
service (to be) provided by Tenant’s Rooftop Installations. If Landlord elects
to install the Central Building System, (i) tenant shall, upon Landlord’s
request and at Tenant’s expense, remove its Rooftop Installations and other
Alterations (including any existing cabling) from the Building and repair any
damage caused their installation or removal, (ii) Tenant may, at Tenant’s
expense and subject to the provisions of this Lease (including, without
limitation, subparagraph P hereof), have access to and use (and tie into) the
Central Building System for the uses permitted hereunder, and (ii) commencing
upon Tenant’s use of the Central Building System and continuing thereafter
throughout the term, the Annual Fixed Rent payable hereunder shall be adjusted
to be that which is reasonably designated by Landlord from time to time based
upon Landlord’s determination of the fair market value of the access rights to
the Central Building System granted herein.

 

16.30       RULES AND REGULATIONS. Tenant will faithfully observe and comply
with the reasonable rules and regulations as Landlord (or, as to the
common areas and facilities of the Prudential Center, any PruOwner) hereafter
at any time or from time to time may make and for which Landlord provides at
least five (5) business days’ prior notice in writing to Tenant (referred
to collectively herein as “Rules and Regulations”), which in the
reasonable judgment of Landlord shall be necessary for the reputation, safety,
care or appearance of the Building and/or the Prudential Center, or the
preservation of good order therein, or the operation or maintenance of the
Building and/or the Prudential Center, or the equipment thereof, or the comfort
of tenants or others in the Prudential Center, provided, however, that in the
case of any conflict between the provisions of this Lease and any such Rules and
Regulations, the provisions of this Lease shall control, and provided further
that nothing contained in this Lease shall be construed to impose upon Landlord
any duty or obligation to enforce the Rules and Regulations or the terms,
covenants or conditions in any other lease as against any other tenant and
Landlord shall not be liable to Tenant for violation of the same by any other
tenant, its servants, employees, agents, contractors, visitors, invitees or
licensees. All Rules and Regulations shall be of general applicability to,
and non-discriminatory applied against, all office tenants in the Building.
Landlord initially has designated the common areas of the Building as
non-smoking, and Landlord shall prohibit smoking in the 23rd floor
so long as any portion of the same is occupied by Tenant.

 

81

 

EXECUTED as a sealed instrument in two or more counterparts by persons
or officers hereunto duly authorized on the Date set forth in Section 1.2
above.

 

	
  WITNESS:

  	
   

  	
  LANDLORD:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  BP

  	
  111
  Huntington Ave LLC

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  Boston
  Properties Limited Partnership,

  a Delaware limited partnership

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Its:
  Member

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
   

  	
  Boston
  Properties, Inc.,

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
  a
  Delaware corporation

  
	
   

  	
   

  	
   

  	
  Its:

  	
   

  	
  General
  Partner

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  /s/
  David R. Barrett

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
  David
  R. Barrett

  	
   

  
	
   

  	
   

  	
   

  	
  Its:

  	
  Senior Vice President

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  Hereunto
  duly authorized

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  TENANT:

  
	
  ATTEST:

  	
   

  	
  FEDERAL
  HOME LOAN BANK OF

  
	
   

  	
  BOSTON,
  a Federal instrumentality

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  By

  	
  /s/ Gerard J. Champagne

  	
   

  	
   

  	
  By

  	
  /s/ Carol Whaley

  	
   

  
	
  Name

  	
  GERARD J. CHAMPAGNE

  	
   

  	
   

  	
  Name

  	
  Carol Whaley

  	
   

  
	
  Title

  	
  SECRETARY

  	
   

  	
   

  	
  Title

  	
  FIRST VICE PRESIDENT)

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
  HEREUNTO
  DULY AUTHORIZED

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Name

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Title

  	
   TREASURER
  (OR ASSISTANT

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  TREASURER)

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  HEREUNTO
  DULY AUTHORIZED

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  (CORPORATE
  SEAL)

  
												

 

82EXHIBIT
10.5

 

MORTGAGE
PARTNERSHIP FINANCE®

INVESTMENT AND SERVICES AGREEMENT

(Participation
Program Contribution)

 

This MORTGAGE PARTNERSHIP
FINANCE (“MPF®”) Investment and
Services Agreement (the “Agreement”) is entered into as of the 20th day
of April, 2000, and is executed by the FEDERAL HOME LOAN BANK OF BOSTON (the “Boston
Bank”), a corporation organized and existing under the laws of the United
States of America, having its principal office at One Financial Center, 20th
Floor, Boston, Massachusetts 02111 and the FEDERAL HOME LOAN BANK OF CHICAGO
(the “MPF Provider”), a corporation organized and existing under the laws of
the United States of America, having its principal office at 111 East Wacker
Drive, Suite 800, Chicago, Illinois 60601.

 

RECITALS:

 

WHEREAS, the MPF Provider
and Boston Bank are Federal Home Loan Banks (“FHLBs”) established under the
authority of the Federal Home Loan Bank Act, 12 U.S.C. § 1421 et seq., to carry out a housing finance mission which
includes supporting mortgage finance in a safe and sound manner;

 

WHEREAS, in support of
its housing finance mission, the MPF Provider has developed the MPF Program, a
financial services product whereby the MPF Provider funds residential mortgage
loans (“Loans”) through its members acting as agents of the MPF Provider, or
whereby the MPF Provider purchases Loans from its members, pursuant to separate
Participating Financial Institution Agreements (“PFI Agreements”) with each
participating member;

 

WHEREAS,  the Boston Bank
wishes to provide its members access to the MPF Program, and is therefore
willing (i) to fund Loans through its members acting as its agents
pursuant to the MPF Program, (ii) to purchase Loans from its members
pursuant to the MPF Program, and (iii) to have the MPF Provider operate
and maintain the MPF Program for the benefit of the Boston Bank, in addition to
the MPF Provider and any other FHLBs that are or may participate in the MPF Program;
and

 

WHEREAS, the MPF Provider
is willing (i) to make the MPF Program available to those Boston Bank
members designated by the Boston Bank, and (ii) to operate and maintain
the MPF Program for the benefit of the Boston Bank as well as itself and other
FHLB participants in the MPF Program, subject to the terms and conditions set
forth in this Agreement; and

 

WHEREAS, the parties
contemplate entering into a participation pooling arrangement with other FHLBs
whereby each FHLB that joins in the arrangement will contribute participation
interests in MPF assets to a pool and in return will receive an interest in the
total pool of participation interests; such arrangement is expected to
supplement rather than supersede this Agreement.

 

 

NOW THEREFORE, in
consideration of the foregoing recitals, for other good and valuable
consideration the receipt and sufficiency of which are hereby acknowledged and
the mutual covenants and conditions herein contained, the parties hereto hereby
agree as follows:

 

ARTICLE I

CERTAIN
DEFINITIONS

 

As used herein, the
following terms shall have the following respective meanings:

 

“Administrative Costs”
shall mean any and all liabilities, costs, expenses and disbursements which may
be incurred or paid by the Boston Bank or the MPF Provider under or in the
management of any PFI Agreement, Master Commitment, the Guides, any Loan or any
Loan Documents, or any amendment, modification, supplement, restatement or
waiver of any thereof, or in any action taken to collect the liabilities
created under or in connection with any PFI Agreement, Master Commitment, the
Guides, or any Loan or Loan Documents or to enforce or protect any collateral
for such liabilities, for which no previous reimbursement has been made by or
on behalf of the applicable Borrower or PFI, except those which one of the
parties has specifically agreed to bear without reimbursement from the other
party.

 

“Agency Loan” shall mean
a Loan that is originated by a member of a FHLB as agent for that FHLB under
the MPF Program and funded by that FHLB, and which is therefore owned by such
FHLB from origination and is never owned by the member.

 

“Borrower” shall mean the
obligor or obligors under any Loan.

 

“Business Day” shall mean
any day that the MPF Provider is open for business.

 

“Clearing Account” shall
mean the Boston Bank’s deposit account or accounts at the MPF Provider,
pursuant to the MPF Provider standard agreement for such account(s) from time
to time, for the clearing of debits and credits between the MPF Provider and
the Boston Bank.

 

“Closed Loan” shall mean
a Loan that was owned by a PFI prior to the sale of the Loan to a FHLB under
the MPF Program.

 

“Custodian” shall mean,
at any time, the custodian  to whom the MPF
Provider delegates its duties and obligations under the MPF Program to hold the
Loan Documents pertaining to the Program Loans.

 

“Customized Enhancement”
shall mean a technical enhancement to the MPF Program system made at the
request of an MPF Bank that solely benefits such MPF Bank.

 

“DDA Account” shall mean
a transactional account with an MPF Bank or the MPF Provider.

 

“Default Rate” shall mean
a rate equal to the then current 10 year U.S. Treasury note rate.

 

2

 

“Designated Delivery
Commitment” shall mean each Delivery Commitment entered into by the Boston Bank
on any Business Day after it has given a Liquidity Option Notice to the MPF Provider.

 

“FHLB Guide” shall mean
the Guide for the MPF Banks published by the MPF Provider detailing policy and
procedures among the MPF Banks for their participation in the MPF Program, as
the same may be amended  after
consultation with the MPF Banks from time to time, which FHLB Guide is hereby
incorporated by reference into this Agreement.

 

“Guides” shall mean,
collectively, the Origination Guide and the Servicing Guide promulgated by the MPF
Provider for the MPF Program, as the MPF Provider may revise them from time to
time.

 

“Liquidity Option MPF
Participation Agreement” shall mean that certain agreement referenced in Section 5.10.2.

 

“Liquidity Option Notice”
shall mean a notice to MPF Provider that the Boston Bank elects to participate
to the MPF Provider a 100% participation interest in the Program Loans funded
or purchased under any and all Delivery Commitments issued by the Boston Bank
for the balance of the Business Day, and pursuant to which notice the MPF
Provider shall acquire a 100% participation in such Program Loans; such
Delivery Commitments will be issued in the Boston Bank’s name and the Program
Loans funded or purchased thereunder will be 100% participated to the MPF
Provider pursuant to the terms of the Liquidity Option MPF Participation
Agreement.

 

“Loan” shall mean a
residential loan made by a member bank to a Borrower that is evidenced by a
promissory note and secured by a mortgage lien, deed of trust, security deed or
other security instrument.

 

“Loan Documents” shall
mean, for any Loan, the note, the mortgage or other security documents executed
and delivered by the applicable Borrower and all other documents evidencing or
securing such Loan, as the same may be amended, supplemented, modified or
restated from time to time.

 

“Loan Recoveries” shall
mean all payments and any other sums received with respect to a Program Loan,
including, but not limited to, from the disposition of any collateral for such
loan. Notwithstanding the foregoing, Loan Recoveries shall not include any
amounts due to the seller of a Closed Loan for payment or sums due prior to the
date of the purchase of such Closed Loan by the MPF Bank.

 

“Note” for any Loan shall
mean the promissory note from the Borrower evidencing such Loan.

 

3

 

“Master Commitment” shall
mean an agreement between an MPF Bank and its PFI pursuant to which the PFI
agrees to originate Agency Loans for or sell Closed Loans  to such MPF Bank, credit enhance and service
such Loans thereafter, in accordance with the Guides.

 

“Master Servicer” shall
mean, at any time, the entity to which the MPF Provider delegates its duties
and obligations under the MPF Program as the master servicer of  the Program Loans.

 

“MPF Banks” shall mean
the Boston Bank and any other FHLB that has entered into an agreement with the MPF
Provider to offer the MPF Program to their members.

 

“MPF Program” shall mean
the MORTGAGE PARTNERSHIP FINANCE® Program of the MPF Provider, which
is based upon the Guides, the PFI Agreements and the Master Commitments.

 

“Participation Share”
shall mean the MPF Provider’s pro rata
participation interest in the Program Loans the Boston Bank funds or purchases
under the MPF Program (which is in addition to any participation interest
granted to the MPF Provider pursuant to the Liquidity Option MPF Participation
Agreement).

 

“PFI” shall mean a member
of the MPF Bank  that is a “participating
financial institution” that elects to participate in the MPF Program by
executing a PFI Agreement with the MPF Bank.

 

“Program Contribution”
shall have the meaning set forth in Section 2.2.(a).

 

“Program Loans” shall
mean Agency Loans funded or Closed Loans purchased under the MPF Program.

 

“Servicer” shall have the
meaning set forth in the PFI Agreement.

 

“Termination Event” shall
mean any of the following:  (a) a
court of competent jurisdiction determines that the FHLBs do not have the
authority to offer the MPF Program; (b) the Federal Housing Finance Board
orders or otherwise causes the MPF Banks to stop offering the MPF Program; (c) legislation
is enacted which withdraws the FHLBs’ authority to offer the MPF Program; or (d) the
MPF Program is conclusively determined to violate consumer or other federal or
relevant state laws or otherwise does not comply with applicable law in a
manner that materially affects the structure or processes of the MPF Program.

 

“Transaction Services Fee”
shall mean, at any time, the fee charged by the MPF Provider to the MPF Banks
for operational support provided by the MPF Provider in connection with Program
Loans owned by such MPF Banks.

 

Other terms used herein
shall be defined as set forth in this Agreement.  Any capitalized term used herein, which is
not so defined, shall have the meaning ascribed to such term in the
Guides.  The singular shall include the
plural as the context may require.

 

4

 

ARTICLE II

TERM AND INVESTMENT SHARES 

 

2.1.                              Term
of Agreement.  Unless terminated
earlier as provided in Section 7.2.2, the initial term of this Agreement
shall be three (3) years ending on the third anniversary of the date of
this Agreement and thereafter, this Agreement shall continue in force until
terminated by either party giving the other ninety (90) days written
notice.  Notwithstanding the foregoing,
the obligations of the parties shall continue with respect to all Program Loans
funded or purchased under this Agreement prior to the expiration of the initial
term or any extended term, or prior to any termination pursuant to Article VII
hereof.  Upon the termination of this
Agreement for any reason, the Boston Bank agrees to use its best efforts to
promptly return to the MPF Provider all marketing and operational materials
previously provided by the MPF Provider unless other mutually acceptable
arrangements have been made.

 

2.2.                              Program
Contribution; Participation Share.  (a) A
Program Contribution in the amount of One Million Five Hundred Thousand Dollars
($1,500,000) is required for a FHLB to participate in the MPF Program, such
Program Contribution being payable in installments as follows: (i) One
Million Dollars ($1,000,000) upon the execution of a Services Agreement and (ii) Five
Hundred Thousand Dollars ($500,000) upon the earlier to occur of (y) One
Billion Dollars ($1,000,000,000) in Program Loans being funded or purchased
under such Services Agreement or (z) the third anniversary of the execution of
such Services Agreement.

 

(b)  In lieu of
paying the Program Contribution and the Transaction Services Fee, the Boston
Bank hereby agrees to grant the MPF Provider a Participation Share in the
amount of a fifty percent (50%) interest in the first Five Hundred Million
Dollars ($500,000,000) of Boston Bank Program Loans, and the MPF Provider
agrees to acquire such Participation Share.

 

2.3.                              Option
to Change Participation Share. After the earlier to occur of (i) the
cumulative amount of assets transferred as a Participation Share equaling Two
Hundred Fifty Million Dollars ($250,000,000), or (ii) the second
anniversary of the date of this Agreement, the Boston Bank shall have the right
to change the percentage of the MPF Provider’s Participation Share upon giving
the MPF Provider thirty (30) days written notice, thereafter each Master
Commitment executed with the  Boston Bank
PFIs shall be subject to the Participation Share at the investment percentage
specified in such notice (which may be zero). Subject to the provisions of Section 2.5.,
the MPF Provider will continue to provide operational support services for all
Program Loans.

 

2.4.                              Transaction
Services Fee.  Unless exempted under
the provisions of Sections 2.2. or 2.5., the Boston Bank shall pay a monthly
Transaction Services Fee in accordance with the schedule listed in
Appendix A, to the MPF Provider as compensation for the transaction processing
services to be provided to the Boston Bank, all payments to be made by the MPF
Provider debiting the Boston Bank’s Clearing Account.  The Transaction Services Fee shall be
calculated each month by multiplying (x) one-twelfth of the applicable annual
rate by (y) the aggregate outstanding balance of the Boston Bank’s non-exempted
Program Loans at the end of

 

5

 

the previous month as reported by the Master Servicer.  The rates shown in Appendix A are annual
rates. The rates shown in Appendix A may be adjusted annually to reflect any
increases in the fees charged to the MPF Provider by the Custodian or Master
Servicer.

 

2.5                                 Participation
Share in Lieu of Transaction Services Fee. 
If the Boston Bank elects to change the Participation Share under Section 2.3,
as long as the MPF Provider’s Participation Share in the Program Loans funded
or purchased under Master Commitments executed after the notice period required
in Section 2.3, equals or exceeds twenty-five percent (25 %), the MPF Provider
will not charge the Boston Bank a Transaction Services Fee for such Program
Loans, provided, however, that the MPF Provider may elect on sixty (60) days prior
written notice to the Boston Bank to cease accepting a Participation Share in
the Program Loans and instead to charge the Boston Bank the then applicable
Transaction Services Fee for providing support services under this Agreement.

 

ARTICLE III

MARKETING TO BOSTON BANK PFIs

 

3.1.                        Designation
of Boston Bank PFIs. The Boston Bank may market the MPF Program directly to
its members or the Boston Bank may allow the MPF Provider’s MPF Marketing staff
to make or participate in marketing and sales calls to those members designated
by the Boston Bank.

 

3.2.                              Operational
Training. From time to time the MPF Provider will provide training for
those Boston Bank employees who will have responsibility for completing and
administering PFI Agreements and Master Commitments in conjunction with the MPF
Provider.  The training shall take place
at the offices of the MPF Provider, unless the parties agree otherwise. The
dates for such training shall be scheduled by mutual agreement.  The Boston Bank shall be responsible for
selecting employees with adequate knowledge of the Boston Bank’s operations and
systems, as well as residential mortgage originations and servicing.  The Boston Bank shall pay all travel and
related expenses of its employees in connection with their attending training,
and of the MPF Provider’s employees in connection with their providing
training, if such training is provided at a location other than the MPF
Provider’s offices.

 

3.3.                              Press
Releases and Media Relations.  (a) 
The MPF Provider agrees that during the term of this Agreement, it will provide
the Boston Bank advance notice of all press releases and written communications
with the media, concerning the Boston Bank’s or Boston Bank PFIs’ involvement
with the MPF Program, and that it will not release or publish such items
without the Boston Bank’s prior consent; provided however, that failure of the
Boston Bank to respond to the notice of a communication by the close of the
following Business Day after receipt shall be deemed to be consent to its
publication.

 

(b)                                 The
Boston Bank agrees that during the term of this Agreement, it will provide the MPF
Provider advance notice of all press releases and written communications with
the media, concerning the MPF Program, and that it will not release or publish
such items without the MPF

 

6

 

Provider’s prior consent; provided however, that failure of the MPF Provider
to respond to the notice of a communication by the close of the following
Business Day after receipt shall be deemed to be consent to its publication.

 

ARTICLE IV

OPERATIONAL SYSTEMS

 

4.1.                              Loan
Funding and Reporting Systems.  The MPF
Provider shall work with the Boston Bank to develop an appropriate interface or
method for receiving or sending data transmissions and reports to or from the MPF
Provider.  Data regarding the Boston Bank
PFIs and the Program Loans serviced by its PFIs will be processed on the same
system the MPF Provider uses to process its own MPF Program data.  However, in connection with Agency Loans, the
Boston Bank will be the undisclosed or disclosed principal in whose name Agency
Loans will be funded.  Therefore,
disclosures made to or by PFIs shall refer to the Boston Bank as the funding
party notwithstanding the MPF Provider’s concurrent investment in its Participation
Share of each Loan.

 

4.2.                              Program
Enhancements.   The MPF Provider
shall hold periodic meetings to discuss possible changes and enhancements to
the MPF Program system and to prioritize the scheduling of any such
enhancements.  Such meetings will be open
to all FHLBs participating in the MPF Program, which wish to attend in person
or telephonically.

 

4.3.                              Y2K
Compliance. The MPF Provider represents and warrants to the Boston Bank
that (i) the software used by the MPF Provider in providing ancillary support
services with respect to the Program Loans being administered under the MPF  Program (the “Servicing Software”) will
operate prior to, during and after December 31, 1999 without error
relating to date data, including without limitation, date data which represents
different centuries or more than one century, (ii) the Servicing Software
will not operate abnormally or provide invalid or incorrect results as a result
of date data representing different centuries or more than one century, (iii) the
Servicing Software is designed to ensure year 2000 capability, including
without limitation, date data recognition, calculations which accommodate same
century and multi-century formulas and data values, and date data interface
values that reflect the century, (iv) the Servicing Software will
accurately and correctly manage and manipulate data involving dates, including
single century formulas and multi-century formulas, and will not cause an
abnormally functioning or ending scenario within the application or generate
incorrect values or invalid results involving such dates, and (v) the
Servicing Software will accurately process date/time data from, into and
between the twentieth and twenty-first centuries, and the years 1999 and 2000,
and will accurately perform leap year calculations during and for the twentieth
and twenty-first century, including the leap year 2000.  Notwithstanding any other provision in this
Agreement to the contrary, the MPF Provider’s liability under this Section 4.3.
shall be limited to direct compensatory damages and in no event shall the MPF
Provider be liable under this Section 4.3. for consequential or punitive
damages (except for willful misconduct or gross negligence on the part of the
MPF Provider).

 

7

 

ARTICLE V

PARTICIPATION IN MPF PROGRAM

 

5.1.                              Services
of the Custodian. (a) The MPF Provider shall act as the custodian for
the Boston Bank with respect to all Loans funded or purchased by the Boston
Bank pursuant to the MPF Program.  The MPF
Provider may discharge this duty by entering into a custody agreement (a “Custody
Agreement”) with Norwest Bank Minnesota, N.A. or any other entity which the MPF
Provider deems qualified to act as the Custodian. Notwithstanding the MPF
Provider’s delegation of its custodial obligations to the Custodian, the MPF
Provider shall have direct and primary responsibility to the Boston Bank for
the performance of the duties of the Custodian under the Custody Agreement.

 

(b)                                 The
MPF Provider shall perform or cause to be performed the following custodial
duties for the Boston Bank’s Program Loans, which shall be done in compliance
with the provisions of the PFI Agreements and the incorporated Guides:

 

(i)                                     To
hold the Loan Documents and any other documents or papers relating to a Loan
deposited with the Custodian as an agent for and bailee of the Boston Bank;

(ii)                                  To
review the documents received with respect to a Loan to confirm whether they
comply with the MPF Program requirements;

(iii)                               To
provide exception reports and status reports regarding Loan Documents as
provided for in the FHLB Guide;

(iv)                              Upon
the payment in full or the purchase by a PFI of a Loan, or as needed for
servicing or foreclosure purposes, to release the Loan Documents to the
Servicer or notify the Servicer that the Loan Documents are no longer held by
the Custodian; and

(v)                                 To
maintain or cause the Custodian to maintain customary fidelity and other
insurance in connection with the performance of its obligations under the
Custody Agreement.

 

(c)                                  In
the event that the Custodian fails to produce a Loan Document when requested by
the Servicer, and provided that (i) the Custodian previously acknowledged
in writing that it had possession of such Loan Document, (ii) such Loan
Document is not outstanding pursuant to a prior request for release from the
Servicer, and (iii) such Loan Document was held by the Custodian on behalf
of the Boston Bank (a “Custodial Delivery Failure”), then the MPF Provider
shall, with respect to any missing Loan Document, furnish or cause the
Custodian to furnish a lost Loan Document affidavit in a form reasonably
satisfactory to the Boston Bank and to indemnify (such indemnification to
survive any termination of the Custody Agreement) the Boston Bank and the
Servicer, and their respective designees, harmless against any and all direct
liabilities, obligations, losses, damages, penalties, actions, judgments,
suits, costs, expenses or disbursements, including reasonable attorneys’ fees,
that may be imposed on, incurred by, or asserted against it or them in any way
relating to or arising out of such Custodial Delivery Failure, provided that
neither the MPF Provider nor the Custodian shall be liable for consequential
damages. 

 

8

 

(d)                                 The
MPF Provider shall forward from the Custodian, or cause the Custodian to
deliver to the Boston Bank, such reports applicable to the Boston Bank’s
Program Loans regarding Loan Documents received and the status of requests for
missing loan files or missing documents as required to be provided in the FHLB
Guide. The Custodian shall acknowledge that its holds the Loan Documents
pertaining to Loans owned or held by the Boston Bank which come into its
possession for the benefit of the Boston Bank, and shall dispose of the same
only in accordance with instructions furnished by the MPF Provider on behalf of
the Boston Bank. The Custodian shall not, however, be required to verify the
validity, sufficiency or genuineness of any Loan Document.

 

5.2.                              Services
of the Master Servicer. (a)  
The MPF Provider shall act as the Master Servicer for the Boston Bank
with respect to all Loans funded or purchased by the Boston Bank pursuant to
the MPF Program.  The MPF Provider may
discharge this duty by entering into a master servicing agreement (a “Master
Servicing Agreement”) with Norwest Bank Minnesota, N.A. or any other entity
which the MPF Provider deems qualified to act as the Master Servicer. The MPF
Provider shall have direct and primary responsibility to the Boston Bank for
the performance of the duties of the Master Servicer under the Master Servicing
Agreement.

 

(b)                                 The
MPF Provider shall perform or cause to be performed the following master
servicing duties, which shall be done in compliance with the provisions of the PFI
Agreements, the Guides, and the Servicing Agreements:

 

(i)                                     To
supervise, monitor and oversee the servicing of the Loans and the performance
of each Servicer of its services, duties and obligations under the Servicing
Guide;

(ii)                                  To
receive and review all reports and data that are provided and are deliverable
under the Servicing Guide by each Servicer:

(iii)                               To
collect information, reconcile such information with each Servicer, and submit
reports pertaining to the Loans and any funds due with respect thereto, to the
Boston Bank as provided for in the FHLB Guide;

(iv)                              To
recommend to the Boston Bank corrective action to be taken relative to any
Servicer that fails to comply with the terms and conditions of the Servicing
Guide with respect to defaulted Loans or the property encumbered as security
for Loans;

(v)                                 To
notify the Boston Bank in the event a Servicer has materially or consistently
defaulted under the Servicing Agreement or Servicing Guide and to advise the
Boston Bank of its recommended response to the default, and to assist the
Boston Bank in working with such Servicer to cure any such defaults
expeditiously;

(vi)                              To
maintain or cause the Master Servicer to maintain customary fidelity and other
insurance in connection with the performance of the obligations under the
Master Servicing Agreement;

(vii)                           To make
its books and records relating to the services performed under the Master
Servicing Agreement or those of the Master Servicer accessible for

 

9

 

inspection and copying by
the supervisory agents and examiners of the Federal Housing Finance Board and
by the Boston Bank at any time during normal business hours.

 

Notwithstanding the MPF
Provider’s delegation of master servicing obligations to the Master Servicer
pursuant to the Master Servicing Agreement, the MPF Provider shall not be
relieved from its master servicing obligations hereunder, and the MPF Provider
shall remain obligated and primarily liable to the Boston Bank for the master
servicing of the Loans in accordance with the provisions of this Agreement,
provided, however, that the MPF Provider’s liability arising from or related to
its master servicing obligations under this Section 5.2 shall be limited
to solely liability resulting from the MPF Provider’s or Master Servicer’s
negligence or willful misconduct.

 

5.3.                              Acknowledgements.
The MPF Provider shall provide copies of the Custodian’s and Master Servicer’s
acknowledgments that the Boston Bank is an intended third party beneficiary of
the agreements between the Custodian and the MPF Provider and between the
Master Servicer and the MPF Provider, respectively.

 

5.4.                              Approval
of Boston Bank PFIs. The MPF Provider and the Boston Bank shall jointly
determine the first fifteen (15) Boston Bank members through which Loans will
be originated or from which Loans will be purchased pursuant to the MPF Program.
Thereafter, the Boston Bank shall continue to supply the MPF Provider a copy of
each member’s PFI application, or portion thereof as specified in the FHLB
Guide, prior to approving any of its members as a PFI.  If the MPF Provider objects to the approval
of any member as an Originator and/or Servicer within the time period provided
in the FHLB Guide, then the parties agree to have the suitability of the Boston
Bank member reviewed by KPMG Peat Marwick LLP or such other third party agreed
to by the parties, and they both agree to abide by the determination of such
auditor to either approve or deny the application of such member to become a
Boston Bank PFI.  The costs of such
review and recommendation shall be paid by the Boston Bank unless the parties
agree otherwise.  The Boston Bank shall
enter into a PFI Agreement in the form provided by the MPF Provider with each
such member in order for its member to be deemed a “PFI” under this Agreement.
The Boston Bank shall use the most current form of PFI Agreement as supplied to
it by the MPF Provider when executing a PFI Agreement with a member.

 

5.5.                              Creditworthiness
of PFIs.  Because the financial
condition of a PFI may impact the quality of its servicing, the Boston Bank
shall supply information as requested by the MPF Provider for evaluating the
creditworthiness of each Boston Bank PFI to provide the credit enhancement
required of such PFI under the MPF Program, consistent with applicable law and
regulation. The Boston Bank shall promptly inform the MPF Provider or any
participant in the Program Loans, of any material adverse changes in the
financial condition of any Boston Bank PFIs of which it becomes aware. The
Boston Bank understands and acknowledges that the performance of each PFI is a
risk incident to originating or purchasing Loans pursuant to the MPF Program,
and that the profitability of such investments is contingent, in part, on the
creditworthiness of the PFIs.

 

10

 

5.6.                              Training
of Boston Bank PFIs.  If requested in
writing by the Boston Bank, the MPF Provider shall train the personnel of the
PFIs to enable them to participate in the MPF Program as Originators (defined
in the Guides), sellers and Servicers in accordance with the Guides.  The costs and expenses of MPF Provider’s
personnel shall be paid for by the Boston Bank for any training supplied by the
MPF Provider. All PFI training materials shall be supplied by or approved by
the MPF Provider.

 

5.7.                              MPF
Program Materials.  Any MPF Bank may
submit requests for revisions to the PFI Agreements, the Guides and other MPF
Program documents at any time.  The MPF Provider
may revise the form of the PFI Agreements, the Guides or any other MPF Program
document at any time, provided that the effective date of changes to the Guides
may be delayed to allow appropriate time for the MPF Bank and/or the PFIs to
make changes to their systems.  The MPF Provider
shall send revisions to the Guides directly to the Boston Bank PFIs.

 

5.8.                              Support
of Boston Bank PFIs. The MPF Provider shall be responsible for providing
operational support to all MPF Banks’ participating members by establishing an MPF
Program Service Center (“Service Center”) that can be reached by means of
toll-free telephone and facsimile numbers and will be staffed by MPF Provider
personnel during such hours as may be agreed to by the parties from time to
time. The MPF Provider shall ensure that the Service Center is adequately
staffed to fully service the Boston Bank PFIs in a commercially reasonable
manner and with no less service than the MPF Provider is providing to its own
participating members. The MPF Provider shall 
provide the data transmissions and reports as required by the FHLB
Guide.

 

5.9.                              Execution
of Master Commitments. The Boston Bank will establish the Spread
Account/First Loss Account percentage, the Maximum Credit Enhancement Amount
and the credit enhancement fee for each Master Commitment in accordance with
the FHLB Guide, and notify the MPF Provider of the same.  The Service Center’s personnel will be
responsible for entering each Master Commitment into the MPF Program system.
All Participation Shares or any other participation interest shall be set for
each Master Commitment and may not be changed for that Master Commitment once
Program Loans have been funded or purchased thereunder, with the exception of
interests created under Designated Delivery Commitments.

 

5.10.                        Delivery
Commitments; Pricing.

 

5.10.1.
Pricing of Loans.  Pursuant to the
delegation of pricing authority established by the Federal Housing Finance
Board in Resolution No. 99-50, dated October 4, 1999, the
Boston Bank has elected to utilize the pricing methodology developed by the MPF
Provider, provided that such methodology shall not be modified without prior
notice to the Boston Bank.  Thus, the MPF
Provider shall be responsible for the calculation and publication of the prices
applicable to both Agency Loans and Closed Loans.

 

5.10.2.  Delivery Commitments. (a) As
provided in the Guides, the MPF Provider’s Service Center will publish Rate and
Fee Schedules for Agency Loans and

 

11

 

Closed Loans not
purchased in bulk transactions. Rate and Fee Schedules for Closed Loans
purchased in bulk transactions may be calculated by the MPF Provider separately
for each Delivery Commitment. Rate and Fee Schedules are subject to change as
provided for in the Guides. The Boston Bank PFIs will contact the Service
Center to obtain and fill Delivery Commitments. The Service Center will provide
reports and loan data transmissions concerning all Delivery Commitment
activities of the Boston Bank PFIs to the Boston Bank at the times and in the manner
provided in the FHLB Guide.  The funding
and purchasing of Program Loans will be processed through a PFI’s DDA Account
with the Boston Bank. The Service Center shall compute any Pairoff Fees that
are owed to the Boston Bank by any PFI and will report these amounts to the
Boston Bank. The Boston Bank shall be responsible for collecting Pairoff Fees
from its PFIs and disbursing the same to itself and its participants (including
the MPF Provider), as applicable.

 

(b)                                 (i)                                     At
any time when outstanding Program Loans funded or purchased pursuant to this
Agreement (regardless of the issuance of any participation interests therein)
are less than One Billion Dollars ($1,000,000,000), the Boston Bank shall have
the right to identify Designated Delivery Commitments by giving a Liquidity
Option Notice to the MPF Provider. 
Pursuant to the issuance of such Liquidity Option Notice, the MPF
Provider hereby agrees to acquire a 100% participation in the Program Loans
funded or purchased under any Delivery Commitments requested by the Boston Bank’s
PFIs, such Delivery Commitments shall be issued as Designated Delivery
Commitments.

 

(ii)                                  If outstanding Program Loans funded or
purchased pursuant to this Agreement (regardless of the issuance of any
participation interests therein) equal or exceed One Billion Dollars
($1,000,000,000), the MPF Provider may, at its sole discretion either accept in
writing a Liquidity Option Notice from the Boston Bank and acquire a 100%
participation in such Designated Delivery Commitments, or advise the Boston
Bank that it elects to treat the Liquidity Option Notice as the Boston Bank’s
election not to issue any Delivery Commitments for the remainder of that
Business Day.  In such later case, the
MPF Provider shall cancel all prices published on behalf of the Boston Bank
until the next Business Day.

 

(iii)                               Any
Liquidity Option Notice must be given to the MPF Provider as provided for in
the FHLB Guide. The MPF Provider’s 100% participation in the Program Loans
funded or purchased under Designated Delivery Commitments shall be pursuant to
a Liquidity Option MPF Participation Agreement, which shall be in a form
mutually acceptable to the parties.

 

5.11.                        Quality
Control and Loss Mitigation.  The MPF
Provider will perform the same level of quality control review and loss
mitigation oversight for the Boston Bank’s Program Loans as it performs for its
own Loans and will communicate the results of its quality control activities
and loss mitigation oversight promptly to the persons designated by the Boston
Bank to receive such reports. Consistent with applicable law and regulation,
the Boston Bank agrees to

 

12

 

provide information to the MPF Provider for monitoring the PFIs’
origination and servicing activities. The Boston Bank agrees to administer its
PFI Agreements in accordance with their terms, including the Guides and all
incorporated documents.  The Boston Bank
hereby acknowledges that the MPF Provider, as the drafter of the MPF Program
documents, can provide a definitive interpretation of such documents in the
event of conflict with a PFI over their meaning. The obligation of the Boston
Bank to manage the PFIs’ origination and servicing activities with respect to
Program Loans shall survive termination of this Agreement.

 

5.12.                        Transactional
Relationships.

 

5.12.1.  Maintenance of Accounts at the MPF Provider.  The Boston Bank will establish and maintain
the Clearing Account with the MPF Provider.

 

5.12.2.  Funding of Payment Obligations. The
MPF Provider agrees to fund its share of all Program Loans through the Boston
Bank’s Clearing Account with the MPF Provider which obligation shall be
fulfilled by its funding the Clearing Account with same day funds from time to
time in amounts sufficient to cover its contractual obligations. The MPF
Provider hereby consents to the Boston Bank withdrawing funds from the Clearing
Account from time to time to satisfy the MPF Provider’s obligations to fund its
share of Program Loans and any other obligation under this Agreement. The
Boston Bank hereby consents to the MPF Provider withdrawing funds from the
Clearing Account from time to time to satisfy the Boston Bank’s obligations to
pay any fees and any other obligation under this Agreement.

 

5.12.3.  Interest on Clearing Account.  The MPF Provider will credit to the Boston
Bank’s Clearing Account interest on the outstanding balance thereof from time
to time at the rate of interest paid by the MPF Provider to all MPF Banks under
the MPF Program, as the same is published in the FHLB Guide from time to time
(the “MPF Bank Rate”).  Until such time
as the MPF Bank Rate is published in the FHLB Guide, the MPF Bank Rate, for any
day, shall be equal to the MPF Provider’s Fed Funds Rate for that day less 5
basis points (0.05%). For purposes of this Agreement, the term “Fed Funds Rate”
shall mean, for any day, a rate equal to the weighted average rate the MPF Provider
earns on its overnight investments in the federal funds market, determined as
of the close of business for that day. In the event that any withdrawal from
the Boston Bank’s Clearing Account shall cause the balance in such account to
become negative, such deficit shall be deemed a loan from  the MPF Provider to the Boston Bank, payable
upon demand and bearing interest at a the rate charged by the MPF Provider to
all MPF Banks under the MPF Program, as the same is published in the FHLB Guide
from time to time (the “MPF Bank Default Rate”). Until such time as the MPF
Bank Default Rate is published in the FHLB Guide, the MPF Bank Default Rate,
for any day, shall be equal to the MPF Bank Rate for that day plus 200 basis
points (2.0%).

 

5.13.                        Relationship
of the Parties; Restrictions on Transfers. (a) The MPF Provider or its
designee will hold the Loan Documents pertaining to the Boston Bank Program
Loans in the

 

13

 

same manner as it holds Loan Documents pertaining to its own Program
Loans.  The Boston Bank will receive and
hold all receipts and collections with respect to the Program Loans funded
through or purchased from the Boston Bank PFIs, for the benefit of itself, the
MPF Provider and any other participants who may invest therein, in accordance
with their respective interests in the Loans. 
Except to the extent of its obligations under Section 5.1, the MPF
Provider shall have no fiduciary duty to the Boston Bank.  Except to the extent of its obligations under
Sections 6.4.1. and 7.3., the Boston Bank shall have no fiduciary duty to the
MPF Provider.  The Boston Bank and the MPF
Provider agree that their respective decisions to invest in their respective
shares of the Program Loans to be funded or purchased under each Master
Commitment shall be independent credit decisions.

 

(b)                                 Notwithstanding
the foregoing, the Boston Bank agrees that it will not sell or transfer any of
its interests in Program Loans or its rights under this Agreement, or any
portion of any thereof, except (i) to another FHLB, (ii) to an
institutional third party investor approved of in writing by the MPF Provider,
which approval shall not be unreasonably withheld, or (iii) to the PFIs
providing the credit enhancement for such Program Loans, provided, however,
servicing must be provided by a PFI or an MPF Program approved Servicer, and
the Boston Bank shall continue to monitor the creditworthiness of  its PFIs and, when appropriate to protect the
interests of the holders of the Program Loans, demand and hold collateral to
secure any of its PFIs’ obligations under their respective PFI Agreements.  The MPF Provider will continue to provide
reports defined by Master Commitment.

 

5.14.                        Memo
Spread Account/First Loss Account Allocations. The MPF Provider and the
Boston Bank shall each maintain their own respective loan loss reserves with
respect to the Program Loans.  The Spread
Account/First Loss Account for each Master Commitment (which is an off balance
sheet contingent liability) will be allocated between the parties based upon
their pro rata interests in such Master
Commitment.

 

5.15.                        Rescission
of Payments.  If all or part of any
payment of Loan Recoveries or other amounts paid to the Boston Bank is
rescinded or must otherwise be returned for any reason and if the Boston Bank
has paid to the MPF Provider its pro rata share
thereof, then the MPF Provider shall pay to the Boston Bank an amount equal to
the MPF Provider’s pro rata share
of the amount which was rescinded or which must be so returned by the Boston
Bank in accordance with the requirements of the FHLB Guide.  The MPF Provider shall also pay to the Boston
Bank any interest on such Loan Recoveries which was also rescinded or must be
returned.

 

ARTICLE VI

REPRESENTATIONS AND COVENANTS

 

6.1.                              Participation
Share and Management of Assets.

 

6.1.1.  Participation Share. Notwithstanding
the Boston Bank obligations under Delivery Commitments to fund Agency Loans,
the MPF Provider will become vested in its Participation Share in each such
Agency Loan concurrent with the funding of said

 

14

 

loan, and without the
need for further documentation, upon the deposit by the MPF Provider of its
Participation Share to the Boston Bank’s Clearing Account.  Upon purchase of each Closed Loan by the
Boston Bank and the deposit by the MPF Provider of its Participation Share of
such Closed Loan to the Boston Bank’s Clearing Account, the MPF Provider shall,
without the need for further documentation, become vested in its Participation
Share of such Closed Loan.

 

6.1.2.  Management of Assets. The PFIs are
obligated under the terms of the PFI Agreements to perform all customary
servicing functions, including loss mitigation and property disposition, with
respect to the Program Loans.  The Boston
Bank shall have the responsibility to protect its Program Loans by enforcing
the terms of the PFI Agreement and PFIs compliance with the Guides, on behalf
of itself and the MPF Provider. Except for funds received from the MPF
Provider, if the Boston Bank shall in any manner receive any Loan Recoveries or
property in connection with any such Loan, including but not limited to
payments from PFIs or the proceeds of collateral pledged by PFIs to secure
their respective obligations under PFI Agreements, the Boston Bank shall
transfer to the MPF Provider its pro rata share
of all such receipts as provided in the FHLB Guide.

 

6.1.3.  Sharing in the Assets.  The Boston Bank and MPF Provider shall be
entitled to their respective pro rata shares
of all principal, interest and other recoveries received relative to each of
the Boston Bank Program Loans subject to their respective pro rata
obligations with respect to the (i) the credit enhancement fees payable
under the applicable PFI Agreement, (ii) Realized Losses defined in the
applicable PFI Agreement, (iii) Agent Fees under the PFI Agreement and all
other costs and expenses incurred or payable for the management of the asset,
with respect to such Loan or the PFI Agreement to which such Loan relates, and (iv) Administrative
Costs in connection with such dispositions that are in excess of the Spread
Account/First Loss Account and the Credit Enhancement provided by the  PFI.

 

6.2.                              Risk
of Loss.  (a) The Boston Bank
assumes all risk of loss in connection with retaining its share of each Boston
Program Loan, and its execution of each PFI Agreement and each Master Commitment
except for any losses arising directly from the negligence or willful
misconduct of the MPF Provider in its provision of services pursuant to this
Agreement or breach of its fiduciary duties; provided, however, that such
assumption of risk is not intended to waive or release the liability of any
person who is not a party to this Agreement. 
The Boston Bank acknowledges that it is familiar with the Guides and the
FHLB Guide and the operation of the MPF Program as described therein.

 

(b)                                 The
MPF Provider assumes all risk of loss in connection with the investment in its
Participation Share of each Boston Bank Program Loan, except for any losses
arising directly from the negligence or willful misconduct of the Boston Bank
in the performance of its obligations under this Agreement or breach of its
fiduciary duties; provided, however, that such assumption of risk is not
intended to waive or release the liability of any person who is not a party to
this Agreement.

 

15

 

6.3.                              Loan
Recoveries.

 

6.3.1.  Application of Loan Recoveries.  All Loan Recoveries received in connection
with each Loan shall be applied as provided in the Loan Documents if specific
provision is made therefor, or otherwise in the following order of priority:

 

(a)                                  to
the payment of all Administrative Costs, if any;

 

(b)                                 to
the payment of any amounts payable by the Borrower pursuant to any Loan
Document (other than the payment of interest or principal) to protect the
interests of the holder of the Loan and to the repayment of any amount
permitted to be paid by the lender under the Loan Documents and actually paid
by the PFI, the Boston Bank or the MPF Provider (such as past due taxes not
paid by Borrower), if any;

 

(c)                                  to
the payment of all interest due and payable on the Note; and

 

(d)                                 to
the payment of principal of the Note.

 

Notwithstanding
any other term or condition in this Agreement, in the event that any party has
advanced moneys with respect to items (a) and (b) above, the party
that has advanced such fees shall be reimbursed by the other according to its pro rata share of said advances.

 

6.3.2.  Default by Borrowers or PFIs; Enforcement.
(a) The parties are entitled to assume that no Borrower or PFI default or
event which, with the giving of notice or lapse of time, or both, would
constitute such a default, has occurred and is continuing unless the parties (i) have
actual knowledge of such default or event, or (ii) have been notified in
writing that such a default or event has occurred.

 

(b)                                 Under
the terms of the PFI Agreement, the PFI shall be responsible for taking
whatever action that is appropriate to enforce the rights and remedies accruing
on account of such Borrower default. The Boston Bank shall be responsible for
taking whatever action that is appropriate to enforce the rights and remedies
accruing on account of any PFI default. All related costs and expenses of such
enforcement are Administrative Costs and are subject to the terms of Section 6.1.3.

 

(c)                                  If
any Borrower or PFI fails to pay taxes, assessments, insurance premiums or any
other charges or expenditures for which such Borrower or PFI is responsible,
the Boston Bank may, but shall not be required to, advance the necessary
amounts or make such expenditures.

 

6.4.                              Boston
Bank’s Covenants. The Boston Bank covenants and agrees as follows:

 

6.4.1.  Collateral for Credit Enhancement  The Boston Bank holds for its, the MPF Provider’s
and any other investors’ proportional benefit the proceeds of all collateral

 

16

 

provided from time to
time by each Boston Bank PFI under its PFI Agreement or any other credit
agreement, securing performance and payment of the credit enhancement
obligations of the PFI under its PFI Agreement. The parties acknowledge that (i) a
security interest in a PFI’s assets under the PFI Agreement is obtained by the
incorporation by reference into that document of the PFI’s advances and
security agreement executed with the Boston Bank (the “Security Agreement”),
and (ii) pursuant to the Security Agreement, all collateral subject to the
security interest created thereby secures all the obligations of a PFI to the
Boston Bank on a pari passu basis, which include
the credit enhancement and other obligations arising under the PFI Agreement
and any advances made by the Boston Bank or MPF Provider, unless (x) collateral
is specifically pledged to secure the PFI’s credit enhancement obligations
under the PFI Agreement or some other specific obligation, and (y) the MPF
Provider is notified of the specific collateral pledge, in which case, the
specifically pledged collateral will first secure the specifically
collateralized obligation.

 

6.4.2.
Use of Proprietary Information and Confidentiality.  The Boston Bank has been and may hereafter be
furnished with certain materials and information relating to the MPF Program
that are confidential and proprietary information of the MPF Provider
(collectively, the “Confidential Information”). The Boston Bank agrees (i) to
keep the Confidential Information confidential using reasonable means, not less
than those used to protect its own proprietary material, (ii) to not
disclose the Confidential Information to any one other than (solely in
connection with the MPF Program) to its officers or employees who have a need
to know its contents to perform their duties for the Boston Bank and to those
third party agents who have signed confidentiality agreements protecting the
MPF Provider, in form and substance reasonably satisfactory to the MPF Provider,
and (iii) upon completion of its use of the Confidential Information or at
any time upon the MPF Provider’s request, to promptly return the Confidential
Information to the MPF Provider, including all copies made thereof in any
format and all notes pertaining to the same. 
The Boston Bank further agrees that if it is served with process or any
other governmental or regulatory request for the Confidential Information, it
will immediately notify the General Counsel of the MPF Provider as provided in
the FHLB Guide, prior to complying with such process, order or request, unless
prohibited by applicable law, regulation or court order. The term “Confidential
Information” does not include information that (a) is or becomes publicly
known or enters the public domain; or (b)(i) was available to the Boston
Bank prior to its disclosure to the Boston Bank by the MPF Provider or (ii) becomes
available to the Boston Bank from a source other than the MPF Provider,
provided that such source is not known by the Boston Bank to be subject to
another confidentiality agreement with the MPF Provider.

 

Nothing in this Agreement in intended
to limit or prohibit the Boston Bank from developing or participating in a
program or offering a product that resembles or competes with the MPF Program
except to the extent that Confidential Information may not be used by the
Boston Bank or anyone receiving Confidential Information from the Boston Bank
to develop or assist in the development of any program or product that
resembles or

 

17

 

competes with the MPF Program and
that the use of Confidential Information is subject to the terms of this Section 6.4.2

 

6.4.3.                     Use of
Intellectual Property. The MPF Provider hereby licenses to the Boston Bank
the limited right to use the trademarks “MORTGAGE PARTNERSHIP FINANCE” and “MPF”
(individually, a “Mark” and together, the “Marks”) subject to the following
terms and conditions:

 

(i)                                     The
term of this license shall be the same as this Agreement. Upon termination of
this license, all rights in and to the Marks shall automatically revert to the MPF
Provider.

 

(ii)                                  When
using either of the Marks in any external communications, including letters,
agreements, program descriptions and marketing materials, the Boston Bank agrees
to adhere to the standards governing the use of the Marks set forth in the FHLB
Guide.

 

(iii)                               The
MPF Provider reserves the right to inspect or monitor the use of the Marks and
the services provided in connection with the Marks to assure compliance with
this Agreement and the FHLB Guide.

 

(iv)                              The
Boston Bank hereby recognizes the value of the goodwill associated with the
Marks and acknowledges that all rights in and to the Marks belong exclusively
to the MPF Provider and that the Marks may have acquired secondary meaning in
the mind of the public.  The Boston Bank
agrees, during the term of this Agreement and thereafter, never to attack or
assist any one else in attacking the rights of the MPF Provider in the Marks or
the validity of the license of the Marks being granted herein.

 

6.5.                              Authorization
and Enforceability Representations. Each of the parties hereby represents
to the other party hereto that (i) all necessary corporate and other
action has been taken to authorize it to execute, and to perform its
obligations under, this Agreement, and (ii) all necessary regulatory
approvals to engage in the MPF Program have been obtained and (iii) this
Agreement is the legal, valid and binding obligation of such party, enforceable
against it.

 

6.6.                              MPF
Provider Representations and Warranties. 
In addition to the above representations, the MPF Provider represents to
the Boston Bank and warrants that the MPF Program is fully compliant with all
state and federal laws, including consumer laws, and federal banking regulatory
rules and regulations, except for any ruling arising in Texas Savings &
Community Bankers Assoc., et al. v. Federal Housing Finance Board, Case No. A
97 CA 421SS (W. Dist. Texas).  Further,
the MPF Provider represents to the Boston Bank and warrants that all
copyrights, trademarks, service marks, patents and other intellectual property
rights used in the MPF Program do not infringe upon the rights of any third
parties.

 

18

 

6.7.                              Boston
Bank’s Indemnification Obligation. The Boston Bank acknowledges that the
ability to participate in the MPF Program will be based upon its
representations and warranties set forth above, and the Boston Bank agrees to
indemnify, defend and hold harmless the MPF Provider, its affiliates and each
stockholder, director, officer, employee and agent, if any, thereof from and
against any and all loss, damage, liability or expense, including (without
limitation) costs and attorneys’ fees and expenses, to which it may be put or which
it may incur by reason of, or in connection with, any misrepresentation made by
the Boston Bank in this Agreement, or any breach by Boston Bank of its
warranties set forth in this Agreement. 
The Boston Bank’s indemnification under this section does not
include any loss, damage, liability or expense arising out of any litigation
challenging the authority of the MPF Provider to engage in the MPF Program,
including Texas Savings & Community Bankers Assoc., et al. v.
Federal Housing Finance Board, Case No. A 97 CA 421SS (W. Dist.
Texas).

 

6.8.                              MPF
Provider’s Indemnification Obligation. 
The MPF Provider agrees to indemnify, defend and hold harmless the
Boston Bank, its affiliates and each stockholder, director, officer, employee
and agent, if any, thereof from and against any and all loss, damage, liability
or expense, including (without limitation) costs and attorney’s fees and
expenses, to which it may be put or which it may incur by reason of, or in
connection with, any misrepresentation made by the MPF Provider in this
Agreement, or any breach by MPF Provider of its warranties set forth in this
Agreement.  The indemnification under
this section does not include any loss, damage, liability or expense
arising out of any litigation challenging the authority of the MPF Provider to
engage in the MPF Program, including Texas Savings & Community
Bankers Assoc., et al. v. Federal Housing Finance Board, Case No. A 97
CA 421SS (W. Dist. Texas).

 

6.9.                              Review
of Accounting Books and Records. 
From time to time upon reasonable advance request, either party shall be
entitled to review, at its cost, the accounting books and records of the other
party with respect to the Boston Bank’s participation in the MPF Program. Both
parties agree and acknowledge that the other party need not provide copies of
or information pertaining to confidential bank examiner’s reports.

 

ARTICLE VII

TERMINATION

 

7.1.                              Events
of Default.  It shall be an Event of
Default under this Agreement if either party fails to perform its obligations
or breaches any of its covenants under this Agreement and such failure to
perform or breach is not cured (i) within sixty (60) days from the date
the non-breaching party gives written notice of such default, if the default is
capable of being cured within such time limit, or (ii) within a reasonable
time after notice if the cure is commenced within the sixty (60) day period and
diligently pursued thereafter.

 

19

 

7.2.                              Termination
and Other Remedies.

 

7.2.1.  Remedies for the Boston Bank’s Default.  Without limiting the effect of Section 6.7,
upon the occurrence of an Event of Default caused by the Boston Bank, (i) the
Boston Bank shall, at the option of the MPF Provider, cease issuing new Master
Commitments under the MPF Program, provided that all other provisions of this
Agreement shall remain in full force and effect for the Boston Bank’s
outstanding Program Loans (including Program Loans funded or purchased under
existing Master Commitments), and (ii) the Boston Bank shall pay to the
MPF Provider an amount equal to the MPF Provider’s actual and direct damages
arising from the Event of Default, but the Boston Bank shall have no
responsibility for any consequential or punitive damages.

 

7.2.2.  Remedies for the MPF Provider’s Default or
for a Termination Event.  Without
limiting the effect of Section 6.8., upon the occurrence of an Event of
Default caused by the MPF Provider or a Termination Event, (i) the Boston
Bank shall have the right to cease issuing new Master Commitments, provided
that all other provisions of this Agreement shall remain in full force and
effect for the Boston Bank’s outstanding Program Loans (including Program Loans
funded or purchased under existing Master Commitments) except (ii) the
Transaction Services Fee for support services provided by the MPF Provider
shall be at a rate equal to the lesser of (a) the rate described in Section 2.4.,
or (b) the MPF Provider’s costs of providing such services to the Boston
Bank, subject however, to the provisions of Sections 5.11, 6.7. and 7.3., and (iii) the
MPF Provider shall pay to the Boston Bank an amount equal to the Boston Bank’s
actual and direct damages arising from the Event of Default, but the MPF
Provider shall have no responsibility for any consequential or punitive
damages.  For purposes of this Section 7.2.2.,
the MPF Provider’s costs in providing support services shall be calculated on a
pro rata basis for all Loans in the MPF
Program rather than on a marginal basis, and shall include all costs and
expenses incurred in improving the MPF System, whether or not such charges are
considered capital improvements or chargeable over more than one accounting
period.

 

7.3.                              Obligations
Regarding PFIs; Support for Program Loans. (a) The Boston Bank’s
covenant to monitor the credit and collateral of PFIs set forth in Section 6.4.
and the Boston Bank’s obligations set forth in this Section 7.3. shall
apply and shall survive the expiration or termination of this Agreement as well
as the sale of the Program Loans by the Boston Bank.

 

(b)                                 The
Boston Bank hereby acknowledges that the MPF Provider has the need to have the
credit enhancement obligations of any PFI relating to Program Loans in which
the MPF Provider has an interest secured if the creditworthiness of the PFI
should become impaired. The Boston Bank agrees to notify the MPF Provider of
any material adverse changes in the financial condition of those PFIs who
provide credit enhancements for any Program Loans in which the MPF Provider has
an interest, and to share relevant credit assessments and information on those
PFIs with the MPF Provider.

 

(c)                                  The
Boston Bank agrees to call and hold for the benefit of the MPF Provider and any
other participants collateral as may be necessary to secure the obligations of
the Boston Bank PFIs under their respective PFI Agreements to maintain the
value of such PFI obligations.

 

20

 

7.4.                        Costs
of Enforcement. Each party agrees to bear its own share of any and all
liabilities, costs, expenses and disbursements (including, without limitation,
reasonable attorneys’ fees and other legal expenses) incurred by it in any
effort to collect any amounts payable hereunder to it by the other party.

 

7.5.                              Exculpation
of Parties. Neither party nor any of its shareholders, directors, officers,
employees or agents shall be liable to the other for any obligation,
undertaking, act or judgment of any Borrower, any PFI, any guarantor or any
other person, or be bound to ascertain or inquire as to the performance or
observance by any PFI of any provision of any PFI Agreement, Master Commitment,
the Guides, any Loan or any of the Loan Documents.

 

ARTICLE VIII

MISCELLANEOUS

 

8.1.                              Notices.  Whenever notice is required under this
Agreement or by applicable law, it must be given as described in this section,
unless otherwise expressly provided in this Agreement.  All demands, notices and communications under
this Agreement shall be in writing (except as expressly provided in Section 8.2.
below) and shall be (i) delivered in person, (ii) sent by certified
United States mail, postage prepaid, return receipt requested, (iii) sent
by facsimile transmission, or (iv) sent through a nationally recognized
overnight delivery service, addressed at the applicable party’s address,
delivery fee prepaid.  Any such notice
shall be deemed delivered upon the earlier of actual receipt and, in the case
of notice by United States mail, three Business Days after deposit with the
United States post office, and in the case of notice by overnight courier, the
Business Day immediately following the date so deposited with the overnight
delivery service.

 

8.2.                              The
Guides and Other Documents.  Copies
of the Guides, including (without limitation) any amendments or supplements, or
of any changes or pronouncements with respect thereto, shall be provided from
time to time by the MPF Provider, at its option, either (a) by regular
mail or otherwise, or (b) electronically to the Boston Bank.

 

8.3.                              Addresses.  For purposes of this Agreement, the address,
telephone and facsimile numbers for the Boston Bank and the electronic
transmission information for the Boston Bank are as set forth below its
signature to this Agreement.  For
purposes of this Agreement, the address, telephone and facsimile numbers for
the MPF Provider and the electronic transmission information for the MPF Provider
are as set forth in the FHLB Guide. Any such change must be given in writing
and given in accordance with the provisions of Section 8.1 or as published
in the FHLB Guide from time to time, but shall be effective only upon actual
receipt.

 

8.4.                              Effect
of Agreement.  The MPF Provider will
have no obligation or responsibility to the Boston Bank except as specifically
stated herein. This Agreement constitutes the entire agreement among the
parties, and no representation, promise, inducement or statement of intent

 

21

 

has been made by the MPF Provider to the Boston Bank which is not
embodied in this Agreement and the incorporated FHLB Guide.

 

8.5.                              Execution
in Counterparts; Facsimile Execution Permitted.  This Agreement may be executed in any number
of counterparts and by the parties hereto on separate counterparts, each of
which, when so executed and delivered, shall be deemed an original and all of
which, taken together, shall constitute but one and the same Agreement.  The parties further agree that this Agreement
and signature pages thereof may be transmitted between them by facsimile
machine and that counterpart facsimile copies are included in the
Agreement.  The parties intend that faxed
signatures may constitute original signatures and that a faxed signature page containing
the signature (original or faxed) of all parties is binding on the parties.

 

8.6.                              Governing
Law.  This Agreement shall be a
contract made under, and governed in every respect by, the internal laws (and
not the conflicts law) of the State of Illinois and applicable federal law.

 

8.7.                              Severability
of Provisions.  Any provision of this
Agreement which is prohibited or unenforceable in any jurisdiction shall, as to
such jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions hereof or
affecting the validity or enforceability of such provision in any other
jurisdiction.

 

8.8.                              Successors
and Assigns.  Subject to the terms of
Section 5.13., this Agreement shall be binding upon and inure to the
benefit of the MPF Provider and the Boston Bank and their respective successors
and permitted assigns. Nothing contained in this Agreement shall limit the
right of the MPF Provider to transfer participation interests in its
Participation Share in Program Loans that were funded or purchased under PFI
Agreements with the Boston Bank.

 

8.9.                              Waivers
and Amendments. No delay on the part of the either party in the exercise of
any right, power or remedy shall operate as a waiver thereof, nor shall any
single or partial exercise by one party of any right, power or remedy preclude
other or further exercise thereof, or the exercise of any other right, power or
remedy.  No amendment to, modification or
waiver of, or consent with respect to, any provision of this Agreement shall be
effective unless in writing and executed and delivered by the MPF Provider and
the Boston Bank.

 

8.10.                        References
to Sections, Exhibits and Agreement; Captions.  Unless otherwise indicated either expressly
or by context, any reference in this Agreement to a “Section” or “Exhibit”
shall be deemed to refer to a Section of or Exhibit to this Agreement.  All references herein to this “Agreement”
shall, as of any time after the date hereof, be deemed to include all
amendments hereto which have been made prior to such time in accordance with Section 8.9.  Article and Section captions used
in this Agreement are for convenience only, and shall not affect the
construction of this Agreement.

 

8.11.                        Specific
Performance.  The parties hereto
recognize and agree that it may be impossible to measure in money the damages
which will accrue to any party hereto or its successors or assigns by reason of
a failure to perform any of the obligations arising under this

 

22

 

Agreement.  Therefore, if a party
or its successors or assigns shall institute any action or proceeding to
enforce any provision hereof, any party against whom such action or proceeding
is brought hereby agrees that specific performance may be sought and obtained
for any breach of this Agreement, without the necessity of providing actual
damages.

 

8.12.                        Mediation
of Disputes; Jurisdiction and Venue. 
(a)  Neither the Boston Bank nor the MPF Provider shall institute a
proceeding before any tribunal to resolve any controversy or claim arising out
of or relating to the Agreement, or the breach, termination or invalidity
thereof (a “Dispute”), before such party has sought to resolve the dispute
through mediation.  If the parties do not
promptly agree on a mediator, either party may request the then Chairman of the
Board of the Federal Housing Finance Board to appoint a mediator.  All mediation proceedings under the Agreement
shall be held in Washington, D.C. or such other location as the parties may
agree upon.  If the mediator is unable to
facilitate a settlement of the Dispute within a reasonable time, as determined
by the mediator, the mediator shall issue a written statement to the parties to
that effect and the complaining party may then pursue any other remedy
available to it at law or in equity.  The
fees and expenses of the mediator shall be paid by the party initiating
mediation, unless the parties agree otherwise.

 

(b)                                 The
Boston Bank hereby consents to the exercise of jurisdiction over its person and
its property by any court of competent jurisdiction situated in the State of
Illinois (whether it be a court of the State of Illinois or a court of the
United States of America situated in Illinois) for the enforcement of this
Agreement or in any other controversy, dispute or question arising hereunder,
and the Boston Bank hereby waives any and all personal or other rights to
object to such jurisdiction for such purposes. 
The Boston Bank, for itself and its successors and assigns, hereby
waives any objection which it may have to the laying of venue of any such action,
suit or proceeding in any such court; provided, that the provisions of this
paragraph shall not be deemed to preclude any other appropriate forum.  If such litigation is commenced at any time,
the parties agree that service of process may be made, and personal
jurisdiction over either party obtained, by service of a copy of the summons,
complaint and other pleadings required to commence such litigation by United
States certified or registered mail, return receipt requested, addressed to
such party at its address for notices as provided in this Agreement.  The Boston Bank and MPF Provider waive all
claims of lack of effectiveness or error by reason of any such service.

 

IN WITNESS WHEREOF, each
of  the MPF Provider and the Boston Bank
has caused this Agreement to be executed by its duly authorized officers, as of
the date first above written.

 

	
   

  	
  MPF PROVIDER:

  
	
   

  	
   

  
	
   

  	
  FEDERAL HOME LOAN BANK OF CHICAGO

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Kenneth L. Gould

  	
   

  
	
   

  	
  Title:

  	
  Executive Vice President

  	
   

  
					

 

23

 

	
   

  	
  BOSTON BANK:

  
	
   

  	
   

  
	
   

  	
  FEDERAL HOME LOAN BANK OF BOSTON

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Michael L. Wilson

  	
   

  
	
   

  	
  Title:

  	
  Senior Executive Vice President

  	
   

  
	
   

  	
   

  
	
   

  	
  Address:

  	
  One Financial Center, 20th Floor

  
	
   

  	
   

  	
  Boston, Massachusetts 02111

  
	
   

  	
  Attention:

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Facsimile No.: (      )                      

  
	
   

  	
  Electronic Transmission:                               

  
							

 

24

 

APPENDIX
A

 

	
  Boston Bank’s

  Aggregate Loan Balance

  	
   

  	
  Transaction Services Fee

  Tiered Annual % Rate

  	
   

  	
  Cumulative

  Annual % Rate

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  First $100
  Million

  	
   

  	
  0.25

  	
  %

  	
  0.250

  	
  %

  
	
  >$100 Million
  to $500 Million

  	
   

  	
  0.17

  	
  %

  	
  0.186

  	
  %

  
	
  >$500 Million
  to $1 Billion

  	
   

  	
  0.13

  	
  %

  	
  0.158

  	
  %

  
	
  >$1 Billion
  to $2 Billion

  	
   

  	
  0.12

  	
  %

  	
  0.139

  	
  %

  
	
  >$2 Billion
  to $4 Billion

  	
   

  	
  0.11

  	
  %

  	
  0.125

  	
  %

  
	
  >$4 Billion
  to $10 Billion

  	
   

  	
  0.10

  	
  %

  	
  0.110

  	
  %

  
	
  More than $10
  Billion

  	
   

  	
  0.10

  	
  %

  	
   

  	
   

  

 

25

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