Document:

Exhibit 10.1

 

 

INSULET CORPORATION

 

AMENDED AND RESTATED EXECUTIVE SEVERANCE PLAN

	
1.

	
Purpose. Insulet Corporation (the “Company”) considers it essential to the best interests of its stockholders to foster the continuous employment of key management personnel. The Board of Directors of the Company (the “Board”) recognizes, however, that, as is the case with many publicly held corporations, the possibility of an involuntary termination of employment, either before or after a Change in Control (as defined in Section 2 hereof), exists and that such possibility, and the uncertainty and questions which it may raise among management, may result in the departure or distraction of management personnel to the detriment of the Company and its stockholders.  Therefore, the Board has determined that the Insulet Corporation Amended and Restated Executive Severance Plan (the “Plan”) should be adopted to reinforce and encourage the continued attention and dedication of the Company’s officers with the title of Vice President or higher (each, a “Covered Executive” and collectively, the “Covered Executives”) to their assigned duties without distraction. Nothing in this Plan shall be construed as creating an express or implied contract of employment and, except as otherwise agreed in writing between the Covered Executive and the Company, the Covered Executive shall not have any right to be retained in the employ of the Company.  The Plan is not intended to be an “employee pension benefit plan” or “pension plan” within the meaning of Section 3(2) of the Employee Retirement Income Security Act of 1974, as amended (“ERISA”).  Rather the Plan is intended to be a “welfare benefit plan” within the meaning of Section 3(1) of ERISA and to meet the requirements of a “severance pay plan” within the meaning of regulations published by the Secretary of Labor at Title 29, Code of Federal Regulations, Section 2510.3-2(b).  Accordingly, no employee shall have a vested right to benefits paid by the Plan.

 

	
2.

	
Definitions.  The following terms shall be defined as set forth below:

 

	
(a)

	
“Base Salary” shall mean the annual base salary in effect immediately prior to the Terminating Event.

 

	
(b)

	
“Cause” shall mean, and shall be limited to, the occurrence of any one or more of the following events:

 

	
(i)

	
conduct by the Covered Executive constituting a material act of willful misconduct in connection with the performance of his duties, including, without limitation, misappropriation of funds or property of the Company or any of its subsidiaries or affiliates other than the occasional, customary and de minimis use of Company property for personal purposes; or

 

	
(ii)

	
the commission by the Covered Executive of any felony or a misdemeanor involving moral turpitude, deceit, dishonesty or fraud, or any conduct by the Covered Executive that would reasonably be expected to result in material injury to the Company or any of its subsidiaries and affiliates if he were retained in his position; or

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(iii)

	
willful and deliberate material non-performance by the Covered Executive of his duties hereunder (other than by reason of the Covered Executive’s physical or mental illness, incapacity or disability) which has continued for more than 30 days following written notice of such non-performance from the Company; or

 

	
(iv)

	
a breach by the Covered Executive of any of the provisions contained in Section 5 of this Plan; or

	
(v)

	
a material violation by the Covered Executive of the Company’s employment policies which has continued following written notice of such violation from the Company; or

 

	
(vi)

	
willful failure to cooperate with a bona fide internal investigation or an investigation by regulatory or law enforcement authorities, after being instructed by the Company to cooperate, or the willful destruction or failure to preserve documents or other materials known to be relevant to such investigation or the willful inducement of others to fail to cooperate or to produce documents or other materials in connection with such investigation.

 

For purposes of clauses (i), (iii) or (vi) hereof, no act, or failure to act, on the Covered Executive’s part shall be deemed “willful” unless done, or omitted to be done, by the Covered Executive without reasonable belief that the Covered Executive’s act or failure to act, was in the best interest of the Company and its subsidiaries and affiliates.

	
(c)

	
“Change in Control” shall be deemed to have occurred upon the occurrence of any one of the following events, so long as such event constitutes a change in the ownership or effective control of the Company or a change in the ownership of a substantial portion of the assets of the Company for purposes of Section 409A of the Code:

	
(i)

	
any “person,” as such term is used in Sections 13(d) and 14(d) of the Securities Exchange Act of 1934, as amended (the “Act”) (other than the Company, any of its subsidiaries, or any trustee, fiduciary or other person or entity holding securities under any employee benefit plan or trust of the Company or any of its subsidiaries), together with all “affiliates” and “associates” (as such terms are defined in Rule 12b-2 under the Act) of such person, shall become the “beneficial owner” (as such term is defined in Rule 13d-3 under the Act), directly or indirectly, of securities of the Company representing 50 percent or more of the combined voting power of the Company’s then outstanding securities having the right to vote in an election of the Board (“Voting Securities”) (in such case other than as a result of an acquisition of securities directly from the Company); or

	
(ii)

	
persons who, as of the date hereof, constitute the Board (the “Incumbent Directors”) cease for any reason, including, without limitation, as a result of a tender offer, proxy contest, merger or similar transaction, to constitute at least a majority of the Board, provided that any person becoming a director of the Company subsequent to the date hereof shall be considered an Incumbent Director if such person’s election was approved by or such person was nominated for election by either (A) a vote of at least a majority of the Incumbent Directors or (B) a vote of at least a majority of the Incumbent Directors who are members of a nominating committee comprised, in the majority, of Incumbent Directors; but provided further, that any such person whose initial assumption of office is in connection with an actual or threatened election contest relating to the election of members of the Board of Directors or other actual or threatened solicitation of proxies or consents by or on behalf of a Person other than the Board, including by reason of agreement intended to avoid or settle any such actual or threatened contest or solicitation, shall not be considered an Incumbent Director; or

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(iii)

	
the consummation of (A) any consolidation or merger of the Company where the stockholders of the Company, immediately prior to the consolidation or merger, would not, immediately after the consolidation or merger, beneficially own (as such term is defined in Rule 13d-3 under the Act), directly or indirectly, shares representing in the aggregate more than 50 percent of the voting shares of the Company issuing cash or securities in the consolidation or merger (or of its ultimate parent corporation, if any), or (B) any sale or other transfer (in one transaction or a series of transactions contemplated or arranged by any party as a single plan) of all or substantially all of the assets of the Company.

 

Notwithstanding the foregoing, a “Change in Control” shall not be deemed to have occurred for purposes of the foregoing clause (i) solely as the result of an acquisition of securities by the Company that, by reducing the number of shares of Voting Securities outstanding, increases the proportionate number of shares of Voting Securities beneficially owned by any person to 50 percent or more of the combined voting power of all then outstanding Voting Securities; provided, however, that if any person referred to in this sentence shall thereafter become the beneficial owner of any additional shares of Voting Securities (other than pursuant to a stock split, stock dividend, or similar transaction or as a result of an acquisition of securities directly from the Company) and immediately thereafter beneficially owns 50 percent or more of the combined voting power of all then outstanding Voting Securities, then a “Change in Control” shall be deemed to have occurred for purposes of the foregoing clause (i).

	
(d)

	
“Code” shall mean the Internal Revenue Code of 1986, as amended.

 

	
(e)

	
“Committee” shall mean the Compensation Committee of the Board or such other committee appointed by such Board to assist the Company in making determinations required under the Plan in accordance with its terms. The Committee may delegate its authority under the Plan to an individual or another committee.

 

	
(f)

	
“Good Reason” shall mean that the Covered Executive has complied with the “Good Reason Process” (hereinafter defined) following the occurrence of any of the following events:

 

	
(i)

	
a material diminution in the Covered Executive’s responsibilities, authority or duties; or

 

	
(ii)

	
a material reduction in the Covered Executive’s Base Salary except for across-the-board salary reductions similarly affecting all or substantially all management employees; or

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(iii)

	
the relocation of the Company offices at which the Covered Executive is principally employed to a location more than 50 miles from such offices.

 

	
(g)

	
“Good Reason Process” shall mean:

 

	
(i)

	
the Covered Executive reasonably determines in good faith that a “Good Reason” condition has occurred;

 

	
(ii)

	
the Covered Executive notifies the Company in writing of the occurrence of the Good Reason condition within 30 days of the occurrence of such condition;

 

	
(iii)

	
the Covered Executive cooperates in good faith with the Company’s efforts, for a period not less than 30 days following such notice (the “Cure Period”), to remedy the condition;

 

	
(iv)

	
notwithstanding such efforts, the Good Reason condition continues to exist following the Cure Period; and

 

	
(v)

	
the Covered Executive terminates his employment within 30 days after the end of the Cure Period.

 

If the Company cures the Good Reason condition during the Cure Period, Good Reason shall be deemed not to have occurred.

 

	
(h)

	
“Plan Administrator” shall mean the individual(s) appointed by the Committee to administer the terms of the Plan as set forth herein and if no individual is appointed by the Committee to serve as Plan Administrator for the Plan, the Plan Administrator shall be the Company’s Chief Human Resources Officer.  Notwithstanding the previous sentence, in the event the Plan Administrator is entitled to benefits under the Plan, the Committee or its delegate shall act as the Plan Administrator for purposes of administering the terms of the Plan with respect to the Plan Administrator.  The Plan Administrator may delegate all or any portion of its authority under the Plan to any other person(s).

	
(i)

	
“Pro-Rata Bonus” shall mean an amount equal to a pro rata portion of the cash incentive award for the year of termination based on the degree to which the applicable Company-based financial performance metrics for the year of termination were satisfied, and assuming target achievement of any performance metrics related to individual performance.

 

	
(j)

	
“Terminating Event” shall mean any of the following events: (i) termination by the Company of the employment of the Covered Executive for any reason other than for Cause, death or disability; (ii) solely with respect to the Chief Executive Officer, the termination by the Chief Executive Officer of his or her employment with the Company for Good Reason; or (iii) during the 24-month period following the occurrence of a Change in Control, the termination by the Covered Executive of his or her employment with the Company for Good Reason.  Notwithstanding the foregoing, a Terminating Event shall not be deemed to have occurred herein solely as a result of the Covered Executive being an employee of any direct or indirect successor to the business or assets of the Company.

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3.

	
Termination Benefits. In the event a Terminating Event occurs with respect to a Covered Executive, the Company shall pay or provide to the Covered Executive any earned but unpaid Base Salary, unpaid expense reimbursements, accrued but unused vacation and any vested benefits the Covered Executive may be entitled to under any employee benefit plan of the Company within the time required by law but in no event more than 30 days after the Terminating Event. In such event, the Covered Executive shall also remain eligible to receive a cash incentive award for the year prior to the Covered Executive’s termination to the extent any such bonus has not yet been determined and/or paid, in which case such bonus, if earned by the Covered Executive under the terms of the applicable cash incentive plan, shall be paid at the same time as payments are made to other participants in the applicable cash incentive plan, but in no event later than March 15th of the year of the Terminating Event.

 

	
(a)

	
Additional Benefits Upon Termination Other Than Within 24 Months Following Change in Control. In the event that the Terminating Event occurs other than during the 24-month period following the occurrence of a Change in Control, then, subject to and contingent upon the Covered Executive’s continued satisfaction of the obligations imposed on the Covered Executive pursuant to Section 5 and the execution of a general release of claims as provided by the Company (the “Release”) by the Covered Executive and the expiration of any revocation period with respect to such Release within 60 days of the Terminating Event, the Company shall pay to the respective Covered Executive, subject to the terms and conditions set forth below, the benefits listed in the following chart:

 

	
Covered Executive

	
Severance Benefits

	
Chief Executive Officer

	
 

(i)  Two times base salary; plus

(ii) Two times target annual incentive plan bonus; plus

(iii) Pro-Rata Bonus; plus

(iv) Continued health and dental insurance coverage for twenty four (24) months; plus

(v)  Reimbursement for outplacement services of up to $25,000.

 

	
 

President

Executive Vice President

Senior Vice President

	
 

(i)  One times base salary; plus

(ii)  With respect to Presidents, Executive Vice Presidents or Senior Vice Presidents who commenced employment with the Company before January 1, 2019, and who experience a Terminating Event before January 1, 2021, one times target annual incentive plan bonus; plus

(iii)     Pro-Rata Bonus; plus

(iv)     Continued health and dental insurance coverage for twelve (12) months; plus

(v)     Reimbursement for outplacement services of up to $25,000.

 

	
 

Vice President

	
 

(i)  One times base salary; plus

(ii)  Continued health and dental insurance coverage for twelve (12) months; plus

(iii)  Reimbursement for outplacement services of up to $15,000.

 

 

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The amounts set forth in the chart above other than the Pro-Rata Bonus shall be paid, subject to Section 11 and clause (b) below, to the respective Covered Executive in substantially equal installments in accordance with the Company’s payroll practice over 12 months (24 months with respect to the Chief Executive Officer); provided, however, that payments for the first 2 months of the period shall not be made until the first payroll date that occurs following the 60-day period beginning on the date of the Terminating Event and the amount paid shall include amounts attributable to the period from the Terminating Event up to and including the payroll period in which the payment is being made. The amount, if any, payable as a Pro-Rata Bonus shall be paid at the same time and in the same manner as bonuses are paid to Company employees generally, but in no event later than March 15th of the year following the fiscal year to which such bonus relates.

	
(b)

	
Additional Benefits Upon Termination Within 24 Months Following Change in Control. In the event that the Terminating Event occurs during the 24-month period following the occurrence of a Change in Control, then, subject to and contingent upon the Covered Executive’s continued satisfaction of the obligations imposed on the Covered Executive pursuant to Section 5 and the execution of the Release by the Covered Executive and the expiration of any revocation period with respect to such Release within 60 days of the Terminating Event, the Company shall pay to the respective Covered Executive, subject to the terms and conditions set forth below, the benefits as listed in the following chart:

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Covered Executive

	
Severance Benefits

	
Chief Executive Officer

President

Executive Vice President

Senior Vice President

 

	
(i)  Two times base salary; plus

(ii) Two times the higher of (a) the Chief Executive Officer’s, President’s, Executive Vice President’s or Senior Vice President’s annual incentive plan target bonus for the fiscal year in which the Terminating Event occurs; or (b) the annual incentive plan bonus actually paid to the Chief Executive Officer, Executive Vice President or Senior Vice President for the fiscal year that immediately precedes the fiscal year in which the Terminating Event occurs; plus

(iii)  Pro-Rata Bonus; plus

(vi)  Continued health and dental insurance coverage for twenty four (24) months; plus

(vii)  Reimbursement for outplacement services of up to $25,000; plus

(viii)  Full and accelerated vesting of all outstanding equity awards, including stock options and all other stock-based equity awards, effective as of the applicable Terminating Event, such that all such awards become nonforfeitable and, with respect to stock options, fully exercisable, as of the Terminating Event.

	
 

Vice President

	
(i)  One times base salary; plus

(ii)  One times the higher of (a) the Vice President’s annual incentive plan target bonus for the fiscal year in which the Terminating Event occurs; or (b) the annual incentive plan bonus actually paid to the respective Vice President for the fiscal year that immediately precedes the fiscal year in which the Terminating Event occurs; plus

(iii)  Pro-Rata Bonus; plus

(iv)  Continued health and dental insurance coverage for twelve (12) months; plus

(v)  Reimbursement for outplacement services of up to $15,000; plus

(vi)  Full and accelerated vesting of all outstanding equity awards, including stock options and all other stock-based equity awards, effective as of the applicable Terminating Event, such that all such awards become nonforfeitable and, with respect to stock options, fully exercisable, as of the Terminating Event.

 

The amounts set forth in the chart above, other than the Pro-Rata Bonus, shall be paid, subject to Section 11, to the respective Covered Executive in a single lump sum payment on the first business day following the expiration of the 60-day period beginning on the date of the Terminating Event.  The amount, if any, payable as a Pro-Rata Bonus shall be paid at the same time and in the same manner as bonuses are paid to Company employees generally, but in no event later than March 15th of the year following the fiscal year to which such bonus relates.

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4.

	
Additional Limitation.

 

	
(a)

	
Anything in this Plan to the contrary notwithstanding, in the event that any compensation, payment or distribution by the Company to or for the benefit of the Covered Executive, whether paid or payable or distributed or distributable pursuant to the terms of this Plan or otherwise (the “Severance Payments”), would be subject to the excise tax imposed by Section 4999 of the Code, the following provisions shall apply:

 

	
(i)

	
If the Severance Payments, reduced by the sum of (A) the Excise Tax and (B) the total of the Federal, state, and local income and employment taxes payable by the Covered Executive on the amount of the Severance Payments which are in excess of the Threshold Amount, are greater than or equal to the Threshold Amount, the Covered Executive shall be entitled to the full benefits payable under this Plan.

 

	
(ii)

	
If the Threshold Amount is less than (A) the Severance Payments, but greater than (B) the Severance Payments reduced by the sum of (1) the Excise Tax and (2) the total of the Federal, state, and local income and employment taxes on the amount of the Severance Payments which are in excess of the Threshold Amount, then the benefits payable under this Plan shall be reduced (but not below zero) to the extent necessary so that the sum of all Severance Payments shall not exceed the Threshold Amount. In such event, the Severance Payments shall be reduced in the following order:  (1) cash payments not subject to Section 409A of the Code; (2) cash payments subject to Section 409A of the Code; (3) equity-based payments and acceleration; and (4) non-cash forms of benefits.  To the extent any payment is to be made over time (e.g., in installments, etc.), then the payments shall be reduced in reverse chronological order.

 

	
(b)

	
For the purposes of this Section 4, “Threshold Amount” shall mean three times the Covered Executive’s “base amount” within the meaning of Section 280G(b)(3) of the Code and the regulations promulgated thereunder less one dollar ($1.00); and “Excise Tax” shall mean the excise tax imposed by Section 4999 of the Code, and any interest or penalties incurred by the Covered Executive with respect to such excise tax.

 

	
(c)

	
The determination as to which of the alternative provisions of Section 4(a) shall apply to the Covered Executive shall be made by a nationally recognized accounting firm selected by the Company (the “Accounting Firm”), which shall provide detailed supporting calculations both to the Company and the Covered Executive within 15 business days of the Terminating Event, if applicable, or at such earlier time as is reasonably requested by the Company or the Covered Executive.  For purposes of determining which of the alternative provisions of Section 4(a) shall apply, the Covered Executive shall be deemed to pay federal income taxes at the highest marginal rate of federal income taxation applicable to individuals for the calendar year in which the determination is to be made, and state and local income taxes at the highest marginal rates of individual taxation in the state and locality of the Covered Executive’s residence on the Terminating Event, net of the maximum reduction in federal income taxes which could be obtained from deduction of such state and local taxes. Any determination by the Accounting Firm shall be binding upon the Company and the Covered Executive.

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5.

	
Confidential Information, Noncompetition and Cooperation.

 

	
(a)

	
Confidentiality.  The Covered Executive understands and agrees that the Covered Executive’s employment creates a relationship of confidence and trust between the Covered Executive and the Company with respect to all Confidential Information (as defined below). At all times, both during the Covered Executive’s employment with the Company and after his or her termination, the Covered Executive will keep in confidence and trust all such Confidential Information, and will not use or disclose any such Confidential Information without the written consent of the Company, except as may be necessary in the ordinary course of performing the Covered Executive’s duties to the Company.

 

	
(b)

	
Confidential Information. As used in this Plan, “Confidential Information” means information belonging to the Company which is of value to the Company in the course of conducting its business and the disclosure of which could result in a competitive or other disadvantage to the Company.  Confidential Information includes, without limitation, financial information, reports, and forecasts; inventions, improvements and other intellectual property; trade secrets; know-how; designs, processes or formulae; software; market or sales information or plans; customer lists; and business plans, prospects and opportunities (such as possible acquisitions or dispositions of businesses or facilities) which have been discussed or considered by the management of the Company. Confidential Information includes information developed by the Covered Executive in the course of the Covered Executive’s employment by the Company, as well as other information to which the Covered Executive may have access in connection with the Covered Executive’s employment.  Confidential Information also includes the confidential information of others with which the Company has a business relationship.  Notwithstanding the foregoing, Confidential Information does not include information in the public domain, unless due to breach of the Covered Executive’s duties under Section 5(a).

	
(c)

	
Documents, Records, etc.  All documents, records, data, apparatus, equipment and other physical property, whether or not pertaining to Confidential Information, which are furnished to the Covered Executive by the Company or are produced by the Covered Executive in connection with the Covered Executive’s employment will be and remain the sole property of the Company.  The Covered Executive will return to the Company all such materials and property as and when requested by the Company. In any event, the Covered Executive will return all such materials and property immediately upon termination of the Covered Executive’s employment for any reason.  The Covered Executive will not retain with the Covered Executive any such material or property or any copies thereof after such termination.

	
(d)

	
Noncompetition and Nonsolicitation.  During the employment of the Covered Executive and for 12 months (24 months if the Covered Executive is the Company’s Chief Executive Officer) thereafter, the Covered Executive (i) will not, directly or indirectly, whether as owner, partner, shareholder, consultant, agent, employee, co-venturer or otherwise, engage, participate, assist or invest in any Competing Business (as hereinafter defined); (ii) will refrain from directly or indirectly employing, attempting to employ, recruiting or otherwise soliciting, inducing or influencing any person to leave employment with the Company (other than terminations of employment of subordinate employees undertaken in the course of the Covered Executive’s employment with the Company); and (iii) will refrain from soliciting or encouraging any customer or supplier to terminate or otherwise modify adversely its business relationship with the Company.  The Covered Executive understands that the restrictions set forth in this Section 5(d) are intended to protect the Company’s interest in its Confidential Information and established employee, customer and supplier relationships and goodwill, and agrees that such restrictions are reasonable and appropriate for this purpose. For purposes of this Plan, the term “Competing Business” shall mean a business conducted anywhere in the United States that is competitive with any business which the Company or any of its affiliates conducts or proposes to conduct at any time during the employment of the Covered Executive. Notwithstanding the foregoing, the Covered Executive may own up to one percent of the outstanding stock of a publicly held corporation which constitutes or is affiliated with a Competing Business.

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(e)

	
Litigation and Regulatory Cooperation. During and after the Covered Executive’s employment, the Covered Executive shall cooperate fully with the Company in the defense or prosecution of any claims or actions now in existence or which may be brought in the future against or on behalf of the Company which relate to events or occurrences that transpired while the Covered Executive was employed by the Company.  The Covered Executive’s full cooperation in connection with such claims or actions shall include, but not be limited to, being available to meet with counsel to prepare for discovery or trial and to act as a witness on behalf of the Company at mutually convenient times. During and after the Covered Executive’s employment, the Covered Executive also shall cooperate fully with the Company in connection with any investigation or review of any federal, state or local regulatory authority as any such investigation or review relates to events or occurrences that transpired while the Covered Executive was employed by the Company.  The Company shall reimburse the Covered Executive for any reasonable out-of-pocket expenses incurred in connection with the Covered Executive’s performance of obligations pursuant to this Section 5(e).

 

	
(f)

	
Non-Disparagement.  During the employment of the Covered Executive and after the termination of employment of the Covered Executive, the Covered Executive agrees not to make or cause to be made, directly or indirectly, any statement to any person criticizing or disparaging the Company or any of its stockholders, directors, officers or employees or commenting unfavorably or falsely on the character, business judgment, services, products, business practices or business reputation of the Company or any of its stockholders, directors, officers or employees.

 

	
(g)

	
Injunction.  The Covered Executive agrees that it would be difficult to measure any damages caused to the Company which might result from any breach by the Covered Executive of the promises set forth in this Section 5, and that in any event money damages would be an inadequate remedy for any such breach.  Accordingly, subject to Section 10 of this Plan, the Covered Executive agrees that if the Covered Executive breaches, or proposes to breach, any portion of this Plan, the Company shall be entitled, in addition to all other remedies that it may have, to an injunction or other appropriate equitable relief to restrain any such breach without showing or proving any actual damage to the Company.

 

	
6.

	
Withholding.  All payments made by the Company under this Plan shall be net of any tax or other amounts required to be withheld by the Company under applicable law.

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7.

	
Plan Administrator.

(a)            It shall be the duty of the Plan Administrator, on the basis of information supplied to it by the Company and the Committee, to properly administer the Plan.  The Plan Administrator shall have the full power, authority and discretion to construe, interpret and administer the Plan, to make factual determinations, to correct deficiencies therein, and to supply omissions.  All decisions, actions and interpretations of the Plan Administrator shall be final, binding and conclusive upon the parties, subject only to determinations by the Named Appeals Fiduciary (as defined in Section 10), with respect to denied claims for benefits.  The Plan Administrator may adopt such rules and regulations and may make such decisions as it deems necessary or desirable for the proper administration of the Plan.

(b)            The Plan Administrator shall receive no compensation for services as such.  However, all reasonable expenses of the Plan Administrator shall be paid or reimbursed by the Company upon proper documentation.  The Plan Administrator shall be indemnified by the Company against personal liability for actions taken in good faith in the discharge of the Plan Administrator’s duties.

(c)            The Plan Administrator shall keep a copy of all records relating to the payment of benefits to Covered Executives and former Covered Executives and all other records necessary for the proper operation of the Plan.  All Plan records shall be made available to the Committee, the Company and to each Covered Executive for examination during business hours except that a Covered Executive shall examine only such records as pertain exclusively to the examining Covered Executive and to the Plan.  The Plan Administrator shall prepare and shall file as required by law or regulation all reports, forms, documents and other items required by ERISA and every other relevant statute, each as amended, and all regulations thereunder.

	
8.

	
Discretion.  Any decisions, actions or interpretations to be made under the Plan by the Company shall be made in its sole discretion, not in any fiduciary capacity and need not be uniformly applied to similarly situated individuals and such decisions, actions or interpretations shall be final, binding and conclusive upon all parties.  As a condition of participating in the Plan, the Covered Executive acknowledges that all decisions and determinations of the Company shall be final and binding on the Covered Executive, his or her beneficiaries and any other person having or claiming an interest under the Plan on his or her behalf.

	
9.

	
Payment.  Payment of benefits to Covered Executives shall be made in such amount as determined by the Company pursuant to Section 3, from the Company’s general assets.

	
10.

	
Claims Procedures.

(a)          Claim.  Each Covered Executive under this Plan may contest only the administration of the benefits awarded by completing and filing with the Plan Administrator a written request for review in the manner specified by the Plan Administrator.  No appeal is permissible as to a Covered Executive’s eligibility for or the amount of benefits, which are decisions made solely within the discretion of the Company.  No person may bring an action for any alleged wrongful denial of Plan benefits in a court of law unless the claims procedures described in this Section 10 are exhausted and a final determination is made by the Plan Administrator and/or the Named Appeals Fiduciary.  If a Covered Executive or other interested person challenges a decision by the Plan Administrator and/or Named Appeals Fiduciary, a review by the court of law will be limited to the facts, evidence and issues presented to the Plan Administrator during the claims procedure set forth in this Section 10.  Facts and evidence that become known to the terminated Covered Executive or other interested person after having exhausted the claims procedure must be brought to the attention of the Plan Administrator for reconsideration.  Issues not raised with the Plan Administrator and/or Named Appeals Fiduciary will be deemed waived.

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(b)          Initial Claim.  Before the date on which payment of benefits commence, each such application must be supported by such information as the Plan Administrator deems relevant and appropriate.  In the event that any claim relating to the administration of benefits is denied in whole or in part, the Covered Executive or his or her beneficiary (“claimant”) whose claim has been so denied shall be notified of such denial in writing by the Plan Administrator within ninety (90) days after the receipt of the claim for benefits.  This period may be extended an additional ninety (90) days if the Plan Administrator determines such extension is necessary and the Plan Administrator provides notice of extension to the claimant prior to the end of the initial ninety (90) day period.  The notice advising of the denial shall specify the following: (i) the reason or reasons for denial, (ii) make specific reference to the Plan provisions on which the determination was based, (iii) describe any additional material or information necessary for the claimant to perfect the claim (explaining why such material or information is needed), and (iv) describe the Plan’s review procedures and the time limits applicable to such procedures, including a statement of the claimant's right to bring a civil action under ERISA Section 502(a) following an adverse benefit determination on review.  If it is determined that payment is to be made, any such payment shall be made within ninety (90) days after the date by which notification is required.

(c)          Appeals of Denied Administrative Claims.  All appeals shall be made by the following procedure:

	
(i)

	
A claimant whose claim has been denied shall file with the Plan Administrator a notice of appeal of the denial.  Such notice shall be filed within sixty (60) calendar days after notification by the Plan Administrator of the denial of a claim, shall be made in writing, and shall set forth all of the facts upon which the appeal is based.  Appeals not timely filed shall be barred.

 

	
(ii)

	
The Named Appeals Fiduciary shall consider the merits of the claimant’s written presentations, the merits of any facts or evidence in support of the denial of benefits, and such other facts and circumstances as the Named Appeals Fiduciary shall deem relevant.

 

	
(iii)

	
The Named Appeals Fiduciary shall render a determination upon the appealed claim which determination shall be accompanied by a written statement as to the reasons therefore.  The determination shall be made to the claimant within sixty (60) days after the claimant’s request for review, unless the Names Appeals Fiduciary determines that special circumstances requires an extension of time for processing the claim.  In such case, the Named Appeals Fiduciary shall notify the claimant of the need for an extension of time to render its decision prior to the end of the initial sixty (60) day period, and the Named Appeals Fiduciary shall have an additional sixty (60) day period to make its determination.  The determination so rendered shall be binding upon all parties.  If the determination is adverse to the claimant, the notice shall provide (i) the reason or reasons for denial, (ii) make specific reference to the Plan provisions on which the determination was based, (iii) a statement that the claimant is entitled to receive, upon request and free of charge, reasonable access to, and copies of, all documents, records and other information relevant to a the claimant’s claim for benefits, and (iv) state that the claimant has the right to bring an action under ERISA Section 502(a). If the final determination is that payment shall be made, then any such payment shall be made within ninety (90) days after the date by which notification of the final determination is required.

12

(d)          Appointment of the Named Appeals Fiduciary.  The Named Appeals Fiduciary shall be the person or persons named as such by the Committee, or, if no such person or persons be named, then the person or persons named by the Plan Administrator as the Named Appeals Fiduciary.  Named Appeals Fiduciaries may at any time be removed by the Committee, and any Named Appeals Fiduciary named by the Plan Administrator may be removed by the Plan Administrator.  All such removals may be with or without cause and shall be effective on the date stated in the notice of removal.  The Named Appeals Fiduciary shall be a “Named Fiduciary” within the meaning of ERISA, and unless appointed to other fiduciary responsibilities, shall have no authority, responsibility, or liability with respect to any matter other than the proper discharge of the functions of the Named Appeals Fiduciary as set forth herein.

 

(e)          Arbitration; Expenses.  In the event of any dispute under the provisions of this Plan, other than a dispute in which the primary relief sought is an equitable remedy such as an injunction, the parties shall have the dispute, controversy or claim settled by arbitration in Boston, Massachusetts (or such other location as may be mutually agreed upon by the Company and the Covered Executive) in accordance with the National Rules for the Resolution of Employment Disputes then in effect of the American Arbitration Association, before a panel of three arbitrators, two of whom shall be selected by the Company and the Covered Executive, respectively, and the third of whom shall be selected by the other two arbitrators.  Any award entered by the arbitrators shall be final, binding and non-appealable and judgment may be entered thereon by either party in accordance with applicable law in any court of competent jurisdiction.  This arbitration provision shall be specifically enforceable.  The arbitrators shall have no authority to modify any provision of this Plan or to award a remedy for a dispute involving this Plan other than a benefit specifically provided under or by virtue of the Plan.  If the Covered Executive substantially prevails on any material issue, which is the subject of such arbitration or lawsuit, the Company shall be responsible for all of the fees of the American Arbitration Association and the arbitrators and any expenses relating to the conduct of the arbitration (including the Company’s and Covered Executive’s reasonable attorneys’ fees and expenses); in this event, any such fees and expenses are limited to those typically incurred in the usual course of arbitration proceedings and shall not be negotiable or determinable by the Covered Executive, and payment to the Covered Executive of such amounts shall occur within ninety (90) days after the date of entry of judgment (entered in accordance with applicable law in any court of competent jurisdiction) of the final, binding and non-appealable arbitration settlement.  Otherwise, each party shall be responsible for its own expenses relating to the conduct of the arbitration (including reasonable attorneys’ fees and expenses) and shall share the fees of the American Arbitration Association.

13

	
11.

	
Section 409A.

 

	
(a)

	
Anything in this Plan to the contrary notwithstanding, if at the time of the Covered Executive’s “separation from service” within the meaning of Section 409A of the Code, the Company determines that the Covered Executive is a “specified employee” within the meaning of Section 409A(a)(2)(B)(i) of the Code, then to the extent any payment or benefit that the Covered Executive becomes entitled to under this Plan would be considered deferred compensation subject to the 20 percent additional tax imposed pursuant to Section 409A(a) of the Code as a result of the application of Section 409A(a)(2)(B)(i) of the Code, such payment shall not be payable and such benefit shall not be provided until the date that is the earlier of (A) six months and one day after the Covered Executive’s separation from service, or (B) the Covered Executive’s death.

 

	
(b)

	
The parties intend that this Plan will be administered in accordance with Section 409A of the Code.  To the extent that any provision of this Plan is ambiguous as to its compliance with Section 409A of the Code, the provision shall be read in such a manner so that all payments hereunder comply with Section 409A of the Code.  The Plan is intended to provide certain benefits that meet the requirements of the “short-term deferral” exception, the “separation pay” exception and other exceptions under Code Section 409A and the regulations promulgated thereunder.

 

	
(c)

	
The determination of whether and when a separation from service has occurred shall be made in accordance with the presumptions set forth in Treasury Regulation Section 1.409A-1(h).

 

	
(d)

	
The Company makes no representation or warranty and shall have no liability to the Covered Executive or any other person if any provisions of this Plan are determined to constitute deferred compensation subject to Section 409A of the Code but do not satisfy an exemption from, or the conditions of, such Section.

 

	
12.

	
Notice and Date of Termination.

 

	
(a)

	
Notice of Termination.  After the occurrence of a Terminating Event, such event shall be communicated by written Notice of Termination from the Company to the Covered Executive or vice versa in accordance with this Section 12. For purposes of this Plan, a “Notice of Termination” shall mean a notice which shall indicate the specific termination provision in this Plan relied upon and the Date of Termination.

 

	
(b)

	
Date of Termination.  “Date of Termination,” with respect to any purported termination of a Covered Executive’s employment, shall mean the date specified in the Notice of Termination.

 

	
(c)

	
Notice to the Company. Covered Executive will send all communications to the Company relating to this Plan, in writing, addressed as follows, subject to change when notified by the Company:

14

Insulet Corporation

ATTN:  General Counsel

600 Technology Park Drive, Suite 200

Billerica, MA 01821

	
(d)

	
Notice to the Executive. Company will send all communications to the Covered Executive, relating to this Plan, in writing, addressed to the Covered Executive at the last address the Covered Executive has filed in writing with the Company.

 

	
13.

	
No Mitigation.  The Covered Executive is not required to seek other employment or to attempt in any way to reduce any amounts payable to the Covered Executive by the Company under this Plan.  Further, the amount of any payment provided for in this Plan shall not be reduced by any compensation earned by the Covered Executive as the result of employment by another employer, by retirement benefits, by offset against any amount claimed to be owed by the Covered Executive to the Company, or otherwise.

 

	
14.

	
Benefits and Burdens.  This Plan shall inure to the benefit of and be binding upon the Company and the Covered Executives, their respective successors, executors, administrators, heirs and permitted assigns. In the event of a Covered Executive’s death after a Terminating Event but prior to the completion by the Company of all payments due him under this Plan, the Company shall continue such payments to the Covered Executive’s beneficiary designated in writing to the Company prior to his death (or to his estate, if the Covered Executive fails to make such designation).

 

	
15.

	
Enforceability. If any portion or provision of this Plan shall to any extent be declared illegal or unenforceable by a court of competent jurisdiction, then the remainder of this Plan, or the application of such portion or provision in circumstances other than those as to which it is so declared illegal or unenforceable, shall not be affected thereby, and each portion and provision of this Plan shall be valid and enforceable to the fullest extent permitted by law.

 

	
16.

	
Waiver.  No waiver of any provision hereof shall be effective unless made in writing and signed by the waiving party. The failure of any party to require the performance of any term or obligation of this Plan, or the waiver by any party of any breach of this Plan, shall not prevent any subsequent enforcement of such term or obligation or be deemed a waiver of any subsequent breach.

 

	
17.

	
Notices.  Any notices, requests, demands, and other communications provided for by this Plan shall be sufficient if in writing and delivered in person or sent by registered or certified mail, postage prepaid, to a Covered Executive at the last address the Covered Executive has filed in writing with the Company, or to the Company at their main office, attention of the Board of Directors.

 

	
18.

	
Effect on Other Plans.  Nothing in this Plan shall be construed to limit the rights of the Covered Executives under the Company benefit plans, programs or policies.

	
19.

	
Unfunded Plan.  The Plan shall not be funded.  No Covered Executive shall have any right to, or interest in, any assets of the Company that may be applied by the Company to the payment of benefits hereunder.

15

	
20.

	
Amendment or Termination of Plan. The Company may amend or terminate this Plan at any time or from time to time provided, however, that this Plan may not be terminated, suspended or amended in any material respect during the period beginning sixty (60) days prior to a Change in Control and ending two (2) years after a Change in Control.  No amendment shall give the Company the right to recover any amount paid to a Covered Executive prior to the date of such amendment or to cause the cessation of any benefits already approved for a Covered Executive who has executed a Release.  Any amendment or termination of the Plan must comply with all applicable legal requirements including, without limitation, compliance with Code Section 409A and the regulations and rulings promulgated thereunder, securities, tax, or other laws, rules regulations or regulatory interpretation thereof, applicable to the Plan.  The Plan shall continue in full force and effect until termination of the Plan pursuant to this Section 20; provided, however, that after the termination of the Plan, if any Covered Executive terminated employment on account of a Terminating Event prior to the termination of the Plan and is still receiving benefits under the Plan, the Plan shall remain in effect until all of the obligations of the Company are satisfied with respect to such Covered Executive.

 

	
21.

	
Governing Law. This Plan shall be construed under and be governed in all respects by the laws of The Commonwealth of Massachusetts.

 

	
22.

	
Obligations of Successors. Any successor to the Company shall assume the obligations under this Plan and expressly agrees to perform the obligations under this Plan.

 

ADOPTED:  May 8, 2008

AMENDED:  November 14, 2008

AMENDED:   December 16, 2010

AMENDED:  February 1, 2015

AMENDED: March 25, 2016

AMENDED: December 14, 2016

AMENDED:  January 1, 2019

 

 

16Exhibit 10.1 

  

		 A 185 –Blumberg’s Improved Gilsey Form Lease, 7-04	©2004 BlumbergExcelsior Inc.

www.blumberg.com

	 	 	 	 	 
	 	
This Agreement BETWEEN

3661 Horseblock Associates LLC, a partnership with offices located at 3661 Horseblock Rd. Medford, NY 11763 Unit Q.

	 
	 	 	 
	and	 	as Landlord
	 	
Chembio Diagnostics Systems Inc. a domestic Corp. 

with offices located at 3661 Horseblock Rd. Medford, NY 11763 

 Units, a,b,c,d,e,f,g,j,k,l,m,n,o.

	 
	 	 	 
	 	 	as Tenant
	 	 
	Witnesseth: The Landlord hereby leases to the Tenant the following premises:	 
	 	 	 
	 	
Approximately 39,660 square feet of building located at 3661 Horseblock Rd. Medford, NY 11763. 

 Units A,B,C,D.E.F,G,J,K,L,M,N,O.

	 
	 	 	 
	for the term of  Two Years (2) 	 
	 	
with a 2 year option (see paragragh51)

	 
	to commence from the                                                 day of 	and to end on the
	 	
May 1, 2017

	 
	 	
30th day of April 2019

	to be used and occupied only for	 
	 	 	 
	 	
Research and development and any lawful commerical or light industrial manufacturing use.

	 
	 	upon the conditions and covenants following:
	 	 	 
	1st. That the Tenant shall pay the annual rent of
	 	 	 
	 	
Annual rent will be $352,860.00 per year. 

 with a 2 1/2 percent increase each year on May 1, 2018.

	 
	 	 	 
	
said rent to be paid in equal monthly payments in advance on the 

	day of each and every month during the
	term aforesaid, as follows:
	 	 	 
	 	
Monthly rent will be $29,405.00 per month 

 with an increase of 2 1/2 percent on May 1, 2018.

	 
	 	 	 
	2nd. That the Tenant shall take good care of the premises and shall, at the Tenant’s own cost and expense make all repairs
	 	 	 
	 	Except structural and preserve the premises in good order and condition.	 
	 	 	 
	and at the end or other expiration of the term, shall deliver up the demised premises in good order or condition, damages by the elements excepted.
	 	 	 
	3rd. That the Tenant shall promptly execute and comply with all statutes, ordinances, rules, orders, regulations and requirements of the Federal, State and Local Governments and of any and all their Departments and Bureaus applicable to said premises, for the correction, prevention, and abatement of nuisances or other grievances, in, upon, or connected with said premises during said term; and shall also promptly comply with and execute all rules, orders and regulations of the New York Board of Fire Underwriters, or any other similar body, at the Tenant’s own cost and expense.
	 	 	 
	4th. That the Tenant, successors, heirs, executors or administrators shall not assign this agreement, or underlet or under-lease the premises, or any part thereof, or make any alterations on the premises, without the Landlord’s consent in writing; or occupy, or permit or suffer the same to be occupied for any business or purpose deemed disreputable or extra-hazardous on account of fire, under the penalty of damages and forfeiture, and in the event of a breach thereof, the term herein shall immediately cease and determine at the option of the Landlord as if it were the expiration of the original term.
	 
	
5th. Tenant must give Landlord prompt notice of fire, accident, damage or dangerous or defective condition. If the Premises can not be used because of fire or other casualty, Tenant is not required to pay rent for the time the Premises are unusable. If part of the Premises can not be used, Tenant must pay rent for the usable part. Landlord shall have the right to decide which part of the Premises is usable. Landlord need only repair the damaged structural parts of the Premises. Landlord is not required to repair or replace any equipment, fixtures, furnishings or decorations unless originally installed by Landlord. Landlord is not responsible for delays due to settling insurance claims, obtaining estimates, labor and supply problems or any other cause not fully under Landlord’s control.

 

If the fire or other casualty is caused by an act or neglect of Tenant, Tenant’s employees or invitees, or at the time of the fire or casualty Tenant is in default in any term of this Lease, then all repairs will be made at Tenant’s expense and Tenant must pay the full rent with no adjustment. The cost of the repairs will be added rent.

 

Landlord has the right to demolish or rebuild the Building if there is substantial damage by fire or other casualty. Landlord may cancel this Lease within 30 days after the substantial fire or casualty by giving Tenant notice of Landlord’s intention to demolish or rebuild. The Lease will end 30 days after Landlord’s cancellation notice to Tenant. Tenant must deliver the Premises to Landlord on or before the cancellation date in the notice and pay all rent due to the date of the fire or casualty. If the Lease is cancelled Landlord is not required to repair the Premises or Building. The cancellation does not release Tenant of liability in connection with the fire or casualty. This Section is intended to replace the terms of New York Real Property Law Section 227.

 

6th. The said Tenant agrees that the said Landlord and the Landlord’s agents and other representatives shall have the right to enter into and upon said premises, or any part thereof, at all reasonable hours for the purpose of examining the same, or making such repairs or alterations therein as may be necessary for the safety and preservation thereof.

 

7th. The Tenant also agrees to permit the Landlord or the Landlord’s agents to show the premises to persons wishing to hire or purchase the same; and the Tenant further agrees that on and after the sixth month, next preceding the expiration of the term hereby granted, the Landlord or the Landlord’s agents shall have the right to place notices on the front of said premises, or any part thereof, offering the premises “To Let” or “For Sale”, and the Tenant hereby agrees to permit the same to remain thereon without hindrance or molestation.

 

8th. That if the said premises, or any part thereof shall be deserted or become vacant during said term, or if any default be made in the payment of the said rent or any part thereof, or if any default be made in the performance of any of the covenants herein contained, the Landlord or representatives may re-enter the said premises and remove all persons and all or any property therefrom, by summary dispossess proceedings or by any suitable action or proceeding at law or otherwise, as permitted by law, without being liable to prosecution therefor, and the Tenant hereby expressly waives the service of any notice in writing of intention to re-enter, and the Tenant shall pay at the same time as the rent becomes payable under the terms hereof a sum equivalent to the rent reserved herein, and the Landlord may rent the premises on behalf of the Tenant, reserving the right to rent the premises for a longer period of time than fixed in the original lease without releasing the original Tenant from any liability, applying any moneys collected, first to the expense of resuming or obtaining possession, second to restoring the premises to a rentable condition, and then to the payment of the rent and all other charges due and to grow due to the Landlord, any surplus to be paid to the Tenant, who shall remain liable for any deficiency. 

 

9th. Landlord may replace, at the expense of Tenant, any and all broken glass in and about the demised premises. Landlord may insure, and keep insured, all plate glass in the demised premises for and in the name of Landlord. Bills, for the premiums therefor shall be rendered by Landlord to Tenant at such times as Landlord may elect, and shall be due from, and payable by Tenant when rendered, and the amount thereof shall be deemed to be, and be paid as, additional rental. Damage and injury to the said premises, caused by the carelessness, negligence or improper conduct on the part of the said Tenant or the Tenant’s agents or employees shall be repaired as speedily as possible by the Tenant at the Tenant’s own cost and expense.

 

10th. That the Tenant shall neither encumber nor obstruct the sidewalk in front of, entrance to, or halls and stairs of said premises, nor allow the same to be obstructed or encumbered in any manner.

 

11th. The Tenant shall neither place, or cause or allow to be placed, any sign or signs of any kind whatsoever at, in or about the entrance to said premises or any other part of same, except in or at such place or places as may be indicated by the Landlord and consented to by the Landlord in writing. And in case the Landlord or the Landlord’s representatives shall deem it necessary to remove any such sign or signs in order to paint the said premises or the building wherein same is situated or make any other repairs, alterations or improvements in or upon said premises or building or any part thereof, the Landlord shall have the right to do so, providing the same be removed and replaced at the Landlord’s expense, whenever the said repairs, alterations or improvements shall be completed.

 

12th. That the Landlord is exempt from any and all liability for any damage or injury to person or property caused by or resulting from steam, electricity, gas, water, rain, ice or snow, or any leak or flow from or into any part of said building or from any damage or injury resulting or arising from any other cause or happening whatsoever unless said damage or injury be caused by or be due to the negligence of the Landlord.

 

13th. That if default be made in any of the covenants herein contained, then it shall be lawful for the said Landlord to re-enter the said premises, and the same to have again, re-possess and enjoy. The said Tenant hereby expressly waives the service of any notice in writing of intention to re-enter.

 

14th. That this instrument shall not be a lien against said premises in respect to any mortgages that are now on or that hereafter may be placed against said premises, and that the recording of such mortgage or mortgages shall have preference and precedence and be superior and prior in lien of this lease, irrespective of the date of recording and the Tenant agrees to execute without cost, any such instrument which may be deemed necessary or desirable to further effect the subordination of this lease to any such mortgage or mortgages, and a refusal to execute such instrument shall entitle the Landlord, or the Landlord’s assigns and legal representatives to the option of cancelling this lease without incurring any expense or damage and the term hereby granted is expressly limited accordingly.

 

15th. The Tenant has this day deposited with the Landlord the sum of $58,810.00 as security for the full and faithful performance by the Tenant of all the terms, covenants and conditions of this lease upon the Tenant’s part to be performed, which said sum shall be returned to the Tenant after the time fixed as the expiration of the term herein, provided the Tenant has fully and faithfully carried out all of said terms, covenants and conditions on Tenant’s part to be performed. In the event of a bona fide sale, subject to this lease, the Landlord shall have the right to transfer the security to the vendee for the benefit of the Tenant and the Landlord shall be considered released by the Tenant from all liability for the return of such security; and the Tenant agrees to look to the new Landlord solely for the return of the said security, and it is agreed that this shall apply to every transfer or assignment made of the security to a new Landlord.

 

16th. That the security deposited under this lease shall not be mortgaged, assigned or encumbered by the Tenant without the written consent of the Landlord.

 

17th. It is expressly understood and agreed that in case the demised premises shall be deserted or vacated, or if default be made in the payment of the rent or any part thereof as herein specified, or if, without the consent of the Landlord, the Tenant shall sell, assign, or mortgage this lease or if default be made in the performance of any of the covenants and agreements in this lease contained on the part of the Tenant to be kept and performed, or if the Tenant shall fail to comply with any of the statutes, ordinances, rules, orders, regulations and requirements of the Federal, State and Local Governments or of any and all their Departments and Bureaus, applicable to said premises, or if the Tenant shall file or there be filed against Tenant a petition in bankruptcy or arrangement, or Tenant be adjudicated a bankrupt or make an assignment for the benefit of creditors or take advantage of any insolvency act, the Landlord may, if the Landlord so elects, at any time thereafter terminate this lease and the term hereof, on giving to the Tenant five days’ notice in writing of the Landlord’s intention so to do, and this lease and the term hereof shall expire and come to an end on the date fixed in such notice as if the said date were the date originally fixed in this lease for the expiration hereof. Such notice may be given by mail to the Tenant addressed to the demised premises.

 

18th. Tenant shall pay to Landlord the rent or charge, which may, during the demised term, be assessed or imposed for the water used or consumed in or on the said premises, whether determined by meter or otherwise, as soon as and when the same may be assessed or imposed, and will also pay the expenses for the setting of a water meter in the said premises should the latter be required. Tenant shall pay Tenant’s proportionate part of the sewer rent or charge imposed upon the building. All such rents or charges or expenses shall be paid as additional rent and shall be added to the next month’s rent thereafter to become due.

 

19th. That the Tenant will not nor will the Tenant permit undertenants or other persons to do anything in said premises, or bring anything into said premises, or permit anything to be brought into said premises or to be kept therein, which will in any way increase the rate of fire insurance on said demised premises, nor use the demised premises or any part thereof, nor suffer or permit their use for any business or purpose which would cause an increase in the rate of fire insurance on said building, and the Tenant agrees to pay on demand any such increase. 

 

20th. The failure of the Landlord to insist upon a strict performance of any of the terms, conditions and covenants herein, shall not be deemed a waiver of any rights or remedies that the Landlord may have, and shall not be deemed a waiver of any subsequent breach or default in the terms, conditions and covenants herein contained. This instrument may not be changed, modified, discharged or terminated orally.

 

21st. If the whole or any part of the demised premises shall be acquired or condemned by Eminent Domain for any public or quasi public use or purpose, then and in that event, the term of this lease shall cease and terminate from the date of title vesting in such proceeding and Tenant shall have no claim against Landlord for the value of any unexpired term of said lease. No part of any award shall belong to the Tenant.

 

22nd.If after default in payment of rent or violation of any other provision of this lease, or upon the expiration of this lease, the Tenant moves out or is dispossessed and fails to remove any trade fixtures or other property prior to such said default, removal, expiration of lease, or prior to the issuance of the final order or execution of the warrant, then and in that event, the said fixtures and property shall be deemed abandoned by the said Tenant and shall become the property of the Landlord.

 

23rd.In the event that the relation of the Landlord and Tenant may cease or terminate by reason of the re-entry of the Landlord under the terms and covenants contained in this lease or by the ejectment of the Tenant by summary proceedings or otherwise, or after the abandonment of the premises by the Tenant, it is hereby agreed that the Tenant shall remain liable and shall pay in monthly payments the rent which accrues subsequent to the re-entry by the Landlord, and the Tenant expressly agrees to pay as damages for the breach of the covenants herein contained, the difference between the rent reserved and the rent collected and received, if any, by the Landlord during the remainder of the unexpired term, such difference or deficiency between the rent herein reserved and the rent collected if any, shall become due and payable in monthly payments during the remainder of the unexpired term, as the amounts of such difference or deficiency shall from time to time be ascertained; and it is mutually agreed between Landlord and Tenant that the respective parties hereto shall and hereby do waive trial by jury in any action, proceeding or counterclaim brought by either of the parties against the other on any matters whatsoever arising out of or in any way connected with this lease, the Tenant’s use or occupancy of said premises, and/or any claim of injury or damage.

 

24th.The Tenant waives all rights to redeem under any law of the State of New York.

 

25th.This lease and the obligation of Tenant to pay rent hereunder and perform all of the other covenants and agreements hereunder on part of Tenant to be performed shall in nowise be affected, impaired or excused because Landlord is unable to supply or is delayed in supplying any service expressly or impliedly to be supplied or is unable to make, or is delayed in making any repairs, additions, alterations or decorations or is unable to supply or is delayed in supplying any equipment or fixtures if Landlord is prevented or delayed from so doing by reason of governmental preemption in connection with a National Emergency or in connection with any rule, order or regulation of any department or subdivision thereof of any governmental agency or by reason of the condition of supply and demand which have been or are affected by war or other emergency.

 

26th.No diminution or abatement of rent, or other compensation, shall be claimed or allowed for inconvenience or discomfort arising from the making of repairs or improvements to the building or to its appliances, nor for any space taken to comply with any law, ordinance or order of a governmental authority. In respect to the various “services,” if any, herein expressly or impliedly agreed to be furnished by the Landlord to the Tenant, it is agreed that there shall be no diminution or abatement of the rent, or any other compensation, for interruption or curtailment of such “service” when such interruption or curtailment shall be due to accident, alterations or repairs desirable or necessary to be made or to inability or difficulty in securing supplies or labor for the maintenance of such “service” or to some other cause, not gross negligence on the part of the Landlord. No such interruption or curtailment of any such “service” shall be deemed a constructive eviction. The Landlord shall not be required to furnish, and the Tenant shall not be entitled to receive, any of such “services” during any period wherein the Tenant shall be in default in respect to the payment of rent. Neither shall there be any abatement or diminution of rent because of making of repairs, improvements or decorations to the demised premises after the date above fixed for the commencement of the term, it being understood that rent shall, in any event, commence to run at such date so above fixed.

 

27th.Landlord shall not be liable for failure to give possession of the premises upon commencement date by reason of the fact that premises are not ready for occupancy or because a prior Tenant or any other person is wrongfully holding over or is in wrongful possession, or for any other reason. The rent shall not commence until possession is given or is available, but the term herein shall not be extended.

 

And the said Landlord doth covenant that the said Tenant on paying the said yearly rent, and performing the covenants aforesaid, shall and may peacefully and quietly have, hold and enjoy the said demised premises for the term aforesaid, provided however, that this covenant shall be conditioned upon the retention of title to the premises by the Landlord.

 

And it is mutually understood and agreed that the covenants and agreements contained in the within lease shall be binding upon the parties hereto and upon their respective successors, heirs, executors and administrators.

 

In Witness Whereof, the parties have interchangeably set their hands and seals (or caused these presents to be signed by their proper corporate officers and caused their proper corporate seal to be hereto affixed) this day of

 

Signed, sealed and delivered

 

	in the presence of	3661 Horseblock Associates LLC	 
	 	 	L. S.
	 	 	 
	 		L. S.
	 	Lorraine Schmidt 	
	 	 	L. S.
	 	         CFO	 
	 	Richard J. Larkin, CFO	 
	 	Chembio Diagnostic Systems Inc.	

 

22nd. If after default in payment of rent or violation of any other provision of this lease, or upon the expiration of this lease, the Tenant moves out or is dispossessed and fails to remove any trade fixtures or other property prior to such said default, removal, expiration of lease, or prior to the issuance of the final order or execution of the warrant, then and in that event, the said fixtures and property shall be deemed abandoned by the said Tenant and shall become the property of the Landlord.

 

23rd. In the event that the relation of the Landlord and Tenant may cease or terminate by reason of the re-entry of the Landlord under the terms and covenants contained in this lease or by the ejectment of the Tenant by summary proceedings or otherwise, or after the abandonment of the premises by the Tenant, it is hereby agreed that the Tenant shall remain liable and shall pay in monthly payments the rent which accrues subsequent to the re-entry by the Landlord, and the Tenant expressly agrees to pay as damages for the breach of the covenants herein contained, the difference between the rent reserved and the rent collected and received, if any, by the Landlord during the remainder of the unexpired term, such difference or deficiency between the rent herein reserved and the rent collected if any, shall become due and payable in monthly payments during the remainder of the unexpired term, as the amounts of such difference or deficiency shall from time to time be ascertained; and it is mutually agreed between Landlord and Tenant that the respective parties hereto shall and hereby do waive trial by jury in any action, proceeding or counterclaim brought by either of the parties against the other on any matters whatsoever arising out of or in any way connected with this lease, the Tenant’s use or occupancy of said premises, and/or any claim of injury or damage.

 

24th. The Tenant waives all rights to redeem under any law of the State of New York.

 

25th. This lease and the obligation of Tenant to pay rent hereunder and perform all of the other covenants and agreements hereunder on part of Tenant to be performed shall in nowise be affected, impaired or excused because Landlord is unable to supply or is delayed in supplying any service expressly or impliedly to be supplied or is unable to make, or is delayed in making any repairs, additions, alterations or decorations or is unable to supply or is delayed in supplying any equipment or fixtures if Landlord is prevented or delayed from so doing by reason of governmental preemption in connection with a National Emergency or in connection with any rule, order or regulation of any department or subdivision thereof of any governmental agency or by reason of the condition of supply and demand which have been or are affected by war or other emergency.

 

26th. No diminution or abatement of rent, or other compensation, shall be claimed or allowed for inconvenience or discomfort arising from the making of repairs or improvements to the building or to its appliances, nor for any space taken to comply with any law, ordinance or order of a governmental authority. In respect to the various “services,” if any, herein expressly or impliedly agreed to be furnished by the Landlord to the Tenant, it is agreed that there shall be no diminution or abatement of the rent, or any other compensation, for interruption or curtailment of such “service” when such interruption or curtailment shall be due to accident, alterations or repairs desirable or necessary to be made or to inability or difficulty in securing supplies or labor for the maintenance of such “service” or to some other cause, not gross negligence on the part of the Landlord. No such interruption or curtailment of any such “service” shall be deemed a constructive eviction. The Landlord shall not be required to furnish, and the Tenant shall not be entitled to receive, any of such “services” during any period wherein the Tenant shall be in default in respect to the payment of rent. Neither shall there be any abatement or diminution of rent because of making of repairs, improvements or decorations to the demised premises after the date above fixed for the commencement of the term, it being understood that rent shall, in any event, commence to run at such date so above fixed.

 

27th. Landlord shall not be liable for failure to give possession of the premises upon commencement date by reason of the fact that premises are not ready for occupancy or because a prior Tenant or any other person is wrongfully holding over or is in wrongful possession, or for any other reason. The rent shall not commence until possession is given or is available, but the term herein shall not be extended.

 

And the said Landlord doth covenant that the said Tenant on paying the said yearly rent, and performing the covenants aforesaid, shall and may peacefully and quietly have, hold and enjoy the said demised premises for the term aforesaid, provided however, that this covenant shall be conditioned upon the retention of title to the premises by the Landlord.

 

And it is mutually understood and agreed that the covenants and agreements contained in the within lease shall be binding upon the parties hereto and upon their respective successors, heirs, executors and administrators.

 

In Witness Whereof, the parties have interchangeably set their hands and seals (or caused these presents to be signed by their proper corporate officers and caused their proper corporate seal to be hereto affixed) this day of

 

Signed, sealed and delivered

 

 

	in the presence of	3661 Horseblock Associates LLC	 
	 	 	L. S.
	 	 	 
	 		L. S.
	 	Lorraine Schmidt	 
	 		L. S.
	 	Chembio Diagnostic Systems Inc.	 

 

 

ACKNOWLEDGMENT

 

	State of New York, County of	ss.:
	On	before me, the undersigned,
	personally appeared	 

 

personally known to me or proved to me on the basis of satisfactory evidence to be the individual(s) whose name(s) is (are) subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their capacity(ies), and that by his/her/their signature(s) on the instrument, the individual(s), or the person upon behalf of which the individual(s) acted, executed the instrument.

 

	 	 
	 	(signature and office of individual taking acknowledgment)

 

ACKNOWLEDGMENT

 

	State of	County of	ss.:
	On	before me, the undersigned,
	personally appeared	 	 

 

personally known to me or proved to me on the basis of satisfactory evidence to be the individual(s) whose name(s) is (are) subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their capacity(ies), and that by his/her/their signature(s) on the instrument, the individual(s), or the person upon behalf of which the individual(s) acted, executed the instrument.

 

	 	 
	 	(signature and office of individual taking acknowledgment)

ACKNOWLEDGMENT BY SUBSCRIBING WITNESS(ES)

 

 

	State of

 County of	} ss.:

 

 

	On	before me, the undersigned,
	personally appeared	

 

the subscribing witness(es) to the foregoing instrument, with whom I am personally acquainted, who, being by me duly sworn, did depose and say that he/she/they reside(s) in (if the place of residence is in a city, include the street and street number, if any, thereof);

 

that he/she/they know(s)

 

to be the individual(s) described in and who executed the foregoing instrument; that said subscribing witness(es) was (were) present and saw said

 

execute the same; and that said witness(es) at the same time subscribed his/her/their name(s) as a witness(es) thereto.

(☐ if taken outside New York State insert city or political subdivision and state or country or other place acknowledgment taken And that Said subscribing witness(es) made such appearance before the undersigned in

 

	 	 
	 	)

 

 

	 	 
	 	(signature and office of individual taking acknowledgment)

 

 

 

 

In Consideration of the letting of the premises within mentioned to the within named Tenant and the sum of

 

3661 Horseblock Associates, LLC

3661 Horseblock Road

 Unit Q

 Medford, NY 11763

February 15, 2017

Chembio Diagnostic Systems Inc.

3661 Horseblock Rd.

 Medford, NY 11763

Units AB,C,D,E,F,G,J,K,L,M,N,O

This letter is to inform you that security is due upon signing of the lease.

Please sign in three (3) places, and return to 3661 Horseblock Associates, LLC. A copy will be sent to you.

	
Security due

	 	
$

	
58,810.00

	 
	
On hand

	 	
$

	
54,610.94

	 
	 	 	 	 	 
	
Total due at signing

	 	
$

	
4,199.06

	 

Thank you for your cooperation in this matter.

Lorraine Schmidt,

 3661 Horseblock Associates, LLC.

 

3661 Horseblock Associates, LLC

  3661 Horseblock Road

Unit Q

  Medford, NY 11763

February 15, 2017

Chembio Diagnostic Systems Inc.

3661 Horseblock Rd.

Medford, NY 11763

 Units AB,C,D,E,F,G,J,K,L,M,N,O

This letter is to inform you that security is due upon signing of the lease.

Please sign in three (3) places, and return to 3661 Horseblock Associates, LLC. A copy will be sent to you.

	
Security due

	 	
$

	
58,810.00

	 
	
On hand

	 	
$

	
54,610.94

	 
	 	 	 	 	 
	
Total due at signing

	 	
$

	
4,199.06

	 

Thank you for your cooperation in this matter.

Lorraine Schmidt,

  3661 Horseblock Associates, LLC.

Rider to lease Agreement dated February 15,2017, by and between 3661 Horseblock Associates, L.L.C., as Landlord and Chembio Diagnostic Systems Inc., as Tenant:

28th: that the tenant, at its own cost and expense shall procure and maintain throughout the term of the lease, an insurance policy commonly known as “Owner, Landlord, and Tenant” insurance in the amount of One Million Dollars ($1,000,000.00) for bodily injury and Five Hundred Thousand Dollars ($500,000.00) for property damage, naming both the landlord and the tenant payable as their interest may appear, covering said premises. Said original O.L. & T. Policy or certificate thereof, shall be deposited with the landlord and the commencement of the lease. Upon failure of the tenant to so deposit said O.L. & T. Policy and keep same currently paid, the landlord shall have the privilege to procure said insurance on its own application thereof and the amount of the premium if paid by landlord, shall be due and payable with the rent installment next due and shall be considered additional rent reserved hereunder, collectible with the same remedies as if originally reserved as rent hereunder.

29th: The landlord will procure and maintain a fire insurance policy covering said premises during the term of said lease. If as a result of any hazards or conditions caused by the tenant, the fire insurance premium payable by the landlord on the policy shall increase over the basic minimum therefore, the tenant shall reimburse the landlord the entire amount of any such increase as shall be directly allocable to the said tenant’s use and occupancy and the amount of such increase in the fire insurance premium shall be collectible by the landlord from the tenant with the same remedies as if originally reserved as rent hereunder.

30th: In addition to the rental provided herein, the tenant shall also pay, as additional rent, 86.90% of any increases in the dollar taxes which are assessed on the entire land, building and parking lot. The base year will be 2011/2012 real estate tax.

The foregoing further additional rent shall be due and payable from the tenant on the 30th Day after the mailing of notice from the landlord demanding such additional rent, and shall be paid in semi-annual installment.

1

For the purposes of this paragraph, the word “taxes” shall mean all real estate taxes, assessments, water and sewer rents and charges and governmental, municipal duty and charges of every kind and nature whatsoever extraordinary as well as ordinary and whether now in the contemplation of the parties, or not, and every and each installment of each of them, which shall, or may during the term of the lease be charges, laid, levied assessed or imposed upon or become a lien or liens upon the demised premises or any part thereof, or upon sidewalks, street, in front of and/or adjoining the demised premises or which may become due payable with respect thereto, and any and all taxes charged, levied, laid, assessed or imposed in lieu of or in addition to the foregoing requirements, orders, directions, ordinances, of the United States of America, or of the State, County, or City government or any other municipal, governmental or lawful authority whatsoever and gas, electricity or any other services to the demised premises or the occupants thereof during the term hereof and all fees and charges of the State, County or City government or any other municipal, governmental or lawful authority whatsoever, for the construction, maintenance or use during the term hereof, of any part of any building of the premises within the limit of the street.

31st: If the landlord commences any action or proceeding for rent, additional rent, or any dispossess proceeding, tenant agrees to pay the sum of SIX HUNDRED DOLLARS ($600.00) as the for landlord’s attorney’s or agent fees, if successful, together with interest, costs, disbursements. Said attorney’s fees shall be deemed to be additional rent for the month in which proceeding is concluded.

32nd: No counterclaim, set-off or claim for reduction shall be made by tenant in any action, for the premises by landlord, summary proceeding or any other proceeding brought by landlord under this lease for the payment of any rent, additional rent, or other charge, or for the enforcement of any of the provisions of this lease or the rules and regulations established hereunder.

33rd: All references herein to the landlord’s “consent” shall be deemed to mean landlords “prior written consent”.

34th: Tennant shall have no power to do any act or make any contract which may create or be the foundation for any lien, mortgage or other encumbrance upon the reversion of other estates of landlord or any interest of landlord in the premises or in the building or improvements thereon. Should tenant cause any alterations, rebuilding, replacements, changes, additions, improvements or repairs to be made to the premises, or labor performed or material furnished therein, thereon or thereto, neither the landlord nor the premises shall, under any circumstances, be liable for the payment of any expense incurred for the value of any work done or material furnished, but all such alterations, rebuilding, replacements, changes, additions, improvements and repairs and labor and material shall be made, furnished and performed at tenant’s expense, and tenant shall be solely and wholly responsible to contractors, laborers and material furnishing and performing such labor and material.

2

35th: Tenant agrees to indemnify, defend and save landlord harmless from any Mechanic’s lien filed against the premises and to pay all costs and expenses resulting there from including landlord’s reasonable consul fees. Tenant agrees, at its own cost, to have any such Mechanic’s lien cancelled and discharged of record within thirty (30) days from the filing thereof. The tenant agrees to defend any action instituted to enforce said lien at its own cost and to apply any judgment resulting there from.

36th: This lease contains all agreements of the parties. There have been no representations understandings other than those included in this lease.

37th: Tenant agrees to indemnify, defend, repay and save the landlord harmless from any and all third party claims, expenses, liabilities, judgments or losses which landlord may suffer or incur as a result of tenant’s violation or breach of this lease, its use of the premises, any failure of tenant to act in accordance with this lease, and or because of any negligent action or omission (or alleged act or omission) on the part of the tenant. If landlord retains an a attorney as a result of the foregoing, all of the charges of said attorney and of landlord’s disbursements shall be paid to landlord by tenant as additional rent for the month in which said charge or disbursement are incurred. Tenant’s liability hereunder extends itself and to its agents employees, contractors, licensees, visitors, invitees and all other persons entering the premises.

38th: Anything to the contrary notwithstanding and provided the tenant is not in default under this lease, the landlord shall not reasonably withhold its consent in extending the tenants the right to assign the lease together with the security deposit hereunder provided compliance be had with the following terms and conditions:

a)         Each assignment of this lease shall be accompanied by an agreement in writing executed by the assignee for the benefit of the landlord wherein the assignee shall assume duties of the tenant hereunder.

b)         Said agreement of this lease shall be accompanied by an agreement in writing executed by the assignee for the benefit of the landlord wherein the assignee shall assume the duties of the tenant hereunder.

c)         The assignment shall in no way operate to release the assignor from the obligations of the tenants under this lease.

3

39th:All fixtures and equipment used by the tenant in the conduct of his business shall remain the property of said tenant and may be removed by him at the end of the term herein demised, provided there is no default as specified in paragraph “Twenty Two” of this lease and provided further, however, that all provisions of Paragraph “Twenty-Two” remains in full force and effect and any damage, alterations or changes made in the demised premises, by the tenant removing any or all of their trade fixtures, shall be full responsibility of the tenant.

40th: Further, if tenant vacates without removing said fixtures or if said fixtures are removed and there is damage to be demised premises, the landlord may remove same or repair said damage and charge said expense to tenant. Landlord may use all or part of the security deposit mentioned heretofore to cover said expenses and if same is insufficient, then tenant shall be personally liable for said expenses and said obligation shall survive the termination of the landlord-tenant relationship established herein.

41st: The tenant will make no structural changes or alterations to the demised without the prior written approval of the landlord. If structural changes or alterations are made, premises have to be restored to original condition this must take place before vacating the premises.

42nd: Tenant further agree to keep the area outside of the demised premises, occupied by the tenant, free from storage of boxes, cartons, garbage, and refuse, except in the area designated for garbage pick-ups.

43rd: The tenant shall, at its own cost and expense, pay any charge or fees in procuring or maintaining any utilities, including electrical and heat, for the demised premises.

44th: Landlord agrees to be responsible for the maintenance of the driveway, parking area, for cleaning and snow removal and shall also be responsible for maintaining the landscaping of the premises. Tenant will be responsible for snow removal and deicing, from their own doorway to parking area, and by loading dock areas.

45th: Tenant shall, at its own cost and expense, be responsible for the removal of any garbage and refuse at the above premises by private sanitation firm approved by the landlord.

46th: In the event any payments due herein are not received by landlord by the 10th. Day after the due date, landlord shall be entitled to impose a 2%late charge for the amount due and owing. Said late charge shall be considered additional rent.

47th: This lease shall not be an offer or binding upon the landlord until such time as a duly executed copy is signed and delivered by landlord to tenant.

4

48th: Tenants represent that they are aware that the premises herein are subject to the requirements set forth in article VII of the Suffolk County Sanitary code set forth in the Covenants and Restrictions recorded in Liber 10311, page 513. Tenant agrees to comply with the terms of said Article VII. Violation of this paragraph shall constitute a material breach of this lease.

49th: The tenant shall not store or park any unregistered vehicle in the parking lot.

50th: When said lease is expired and the tenant vacates the premises, the tenant is responsible to clean units, sanitize bathrooms and remove all garbage from inside and outside of premises. .Any other improvements are the responsibility of the tenant.

  

51st 3661 Horseblock Associates LLC must notify in writing, 3 months in advance for 2 year option May 1, 2019 to April 30, 2021. There will be a 2 1/2% per year increase for each year. Notification should be sent in writing three months before lease expires. We must be notified by January 31, 2019.

52nd Landlord hereby agrees to notify tenant, Chembio Diagnostic Systems Inc., if and when the building herein goes for sale. Parties agree that this is not a right of first refusal or an option to purchase, but merely a courtesy extended to tenant.

	 	 	 
	 	
3661 HORSEBLOCK ASSOCIATES, L.L.C.

	 	 	 
	 	
  BY:  

	 
	 	 	
Lorraine Schmidt

	 	 	 
	 	
  BY:  

	 CFO
	 	 	
Chembio Diagnostic Systems Inc.

5

I, Richard Larkin, CFO, am aware that chemicals, pollutants, etc. are not to be put down sinks, toilets or any other drains, including outside drains. All chemicals and pollutants shall be disposed of in a legal manner according to all local, county, state and federal laws. I will inform all employees, concerning this matter.

There is no outside storage of barrels or other containers, except for garbage containers. All chemicals or pollutants must be stored and used according to all local county, state and federal regulations.

	
Signed

	  CFO	 

 

 

 

 

 

 

 

  

 

		 A 185 –Blumberg’s Improved Gilsey Form Lease, 7-04	©2004 BlumbergExcelsior Inc.

www.blumberg.com

	 	 	 	 
	 	
This Agreement BETWEEN

3661 Horseblock Associates LLC, a partnership with offices located at 3661 Horseblock Rd. Medford, NY 11763 Unit Q.

	 
	 	 	 
	and	 	as Landlord
	 	
Chembio Diagnostics Systems Inc. a domestic Corp. 

with offices located at 3661 Horseblock Rd. Medford, NY 11763 

 Units, a,b,c,d,e,f,g,j,k,l,m,n,o.

	 
	 	 	 
	 	 	as Tenant
	Witnesseth: The Landlord hereby leases to the Tenant the following premises:	 
	 	 	 
	 	
Approximately 39,660 square feet of building located at 3661 Horseblock Rd. Medford, NY 11763. 

 Units A,B,C,D.E.F,G,J,K,L,M,N,O.

	 
	 	 	 
	for the term of  Two Years (2) 	 
	 	
with a 2 year option (see paragragh51)

	 
	to commence from the                                                 day of 	and to end on the
	 	
May 1, 2017

	 
	 	
30th day of April 2019

	to be used and occupied only for	 
	 	 	 
	 	
Research and development and any lawful commerical or light industrial manufacturing use.

	 
	 	upon the conditions and covenants following:
	 	 	 
	1st. That the Tenant shall pay the annual rent of
	 	 	 
	 	
Annual rent will be $352,860.00 per year. 

 with a 2 1/2 percent increase each year on May 1, 2018.

	 
	 	 	 
	
said rent to be paid in equal monthly payments in advance on the                                                                                                  day of each and every month during the 

 term aforesaid, as follows:

	 	 	 
	 	
Monthly rent will be $29,405.00 per month 

 with an increase of 2 1/2 percent on May 1, 2018.

	 
	 	 	 
	2nd. That the Tenant shall take good care of the premises and shall, at the Tenant’s own cost and expense make all repairs
	 	 	 
	 	Except structural and preserve the premises in good order and condition.	 
	 	 	 
	and at the end or other expiration of the term, shall deliver up the demised premises in good order or condition, damages by the elements excepted.
	 	 	 
	3rd. That the Tenant shall promptly execute and comply with all statutes, ordinances, rules, orders, regulations and requirements of the Federal, State and Local Governments and of any and all their Departments and Bureaus applicable to said premises, for the correction, prevention, and abatement of nuisances or other grievances, in, upon, or connected with said premises during said term; and shall also promptly comply with and execute all rules, orders and regulations of the New York Board of Fire Underwriters, or any other similar body, at the Tenant’s own cost and expense.
	 	 	 
	4th. That the Tenant, successors, heirs, executors or administrators shall not assign this agreement, or underlet or underlease the premises, or any part thereof, or make any alterations on the premises, without the Landlord’s consent in writing; or occupy, or permit or suffer the same to be occupied for any business or purpose deemed disreputable or extra-hazardous on account of fire, under the penalty of damages and forfeiture, and in the event of a breach thereof, the term herein shall immediately cease and determine at the option of the Landlord as if it were the expiration of the original term.
	 
	
5th. Tenant must give Landlord prompt notice of fire, accident, damage or dangerous or defective condition. If the Premises can not be used because of fire or other casualty, Tenant is not required to pay rent for the time the Premises are unusable. If part of the Premises can not be used, Tenant must pay rent for the usable part. Landlord shall have the right to decide which part of the Premises is usable. Landlord need only repair the damaged structural parts of the Premises. Landlord is not required to repair or replace any equipment, fixtures, furnishings or decorations unless originally installed by Landlord. Landlord is not responsible for delays due to settling insurance claims, obtaining estimates, labor and supply problems or any other cause not fully under Landlord’s control.

 

If the fire or other casualty is caused by an act or neglect of Tenant, Tenant’s employees or invitees, or at the time of the fire or casualty Tenant is in default in any term of this Lease, then all repairs will be made at Tenant’s expense and Tenant must pay the full rent with no adjustment. The cost of the repairs will be added rent.

 

Landlord has the right to demolish or rebuild the Building if there is substantial damage by fire or other casualty. Landlord may cancel this Lease within 30 days after the substantial fire or casualty by giving Tenant notice of Landlord’s intention to demolish or rebuild. The Lease will end 30 days after Landlord’s cancellation notice to Tenant. Tenant must deliver the Premises to Landlord on or before the cancellation date in the notice and pay all rent due to the date of the fire or casualty. If the Lease is cancelled Landlord is not required to repair the Premises or Building. The cancellation does not release Tenant of liability in connection with the fire or casualty. This Section is intended to replace the terms of New York Real Property Law Section 227.

 

6th. The said Tenant agrees that the said Landlord and the Landlord’s agents and other representatives shall have the right to enter into and upon said premises, or any part thereof, at all reasonable hours for the purpose of examining the same, or making such repairs or alterations therein as may be necessary for the safety and preservation thereof.

 

7th. The Tenant also agrees to permit the Landlord or the Landlord’s agents to show the premises to persons wishing to hire or purchase the same; and the Tenant further agrees that on and after the sixth month, next preceding the expiration of the term hereby granted, the Landlord or the Landlord’s agents shall have the right to place notices on the front of said premises, or any part thereof, offering the premises “To Let” or “For Sale”, and the Tenant hereby agrees to permit the same to remain thereon without hindrance or molestation.

 

8th. That if the said premises, or any part thereof shall be deserted or become vacant during said term, or if any default be made in the payment of the said rent or any part thereof, or if any default be made in the performance of any of the covenants herein contained, the Landlord or representatives may re-enter the said premises and remove all persons and all or any property therefrom, by summary dispossess proceedings or by any suitable action or proceeding at law or otherwise, as permitted by law, without being liable to prosecution therefor, and the Tenant hereby expressly waives the service of any notice in writing of intention to re-enter, and the Tenant shall pay at the same time as the rent becomes payable under the terms hereof a sum equivalent to the rent reserved herein, and the Landlord may rent the premises on behalf of the Tenant, reserving the right to rent the premises for a longer period of time than fixed in the original lease without releasing the original Tenant from any liability, applying any moneys collected, first to the expense of resuming or obtaining possession, second to restoring the premises to a rentable condition, and then to the payment of the rent and all other charges due and to grow due to the Landlord, any surplus to be paid to the Tenant, who shall remain liable for any deficiency. 

 

9th. Landlord may replace, at the expense of Tenant, any and all broken glass in and about the demised premises. Landlord may insure, and keep insured, all plate glass in the demised premises for and in the name of Landlord. Bills, for the premiums therefor shall be rendered by Landlord to Tenant at such times as Landlord may elect, and shall be due from, and payable by Tenant when rendered, and the amount thereof shall be deemed to be, and be paid as, additional rental. Damage and injury to the said premises, caused by the carelessness, negligence or improper conduct on the part of the said Tenant or the Tenant’s agents or employees shall be repaired as speedily as possible by the Tenant at the Tenant’s own cost and expense.

 

10th. That the Tenant shall neither encumber nor obstruct the sidewalk in front of, entrance to, or halls and stairs of said premises, nor allow the same to be obstructed or encumbered in any manner.

 

11th. The Tenant shall neither place, or cause or allow to be placed, any sign or signs of any kind whatsoever at, in or about the entrance to said premises or any other part of same, except in or at such place or places as may be indicated by the Landlord and consented to by the Landlord in writing. And in case the Landlord or the Landlord’s representatives shall deem it necessary to remove any such sign or signs in order to paint the said premises or the building wherein same is situated or make any other repairs, alterations or improvements in or upon said premises or building or any part thereof, the Landlord shall have the right to do so, providing the same be removed and replaced at the Landlord’s expense, whenever the said repairs, alterations or improvements shall be completed.

 

12th. That the Landlord is exempt from any and all liability for any damage or injury to person or property caused by or resulting from steam, electricity, gas, water, rain, ice or snow, or any leak or flow from or into any part of said building or from any damage or injury resulting or arising from any other cause or happening whatsoever unless said damage or injury be caused by or be due to the negligence of the Landlord.

 

13th. That if default be made in any of the covenants herein contained, then it shall be lawful for the said Landlord to re-enter the said premises, and the same to have again, re-possess and enjoy. The said Tenant hereby expressly waives the service of any notice in writing of intention to re-enter.

 

14th. That this instrument shall not be a lien against said premises in respect to any mortgages that are now on or that hereafter may be placed against said premises, and that the recording of such mortgage or mortgages shall have preference and precedence and be superior and prior in lien of this lease, irrespective of the date of recording and the Tenant agrees to execute without cost, any such instrument which may be deemed necessary or desirable to further effect the subordination of this lease to any such mortgage or mortgages, and a refusal to execute such instrument shall entitle the Landlord, or the Landlord’s assigns and legal representatives to the option of cancelling this lease without incurring any expense or damage and the term hereby granted is expressly limited accordingly.

 

15th. The Tenant has this day deposited with the Landlord the sum of $58,810.00 as security for the full and faithful performance by the Tenant of all the terms, covenants and conditions of this lease upon the Tenant’s part to be performed, which said sum shall be returned to the Tenant after the time fixed as the expiration of the term herein, provided the Tenant has fully and faithfully carried out all of said terms, covenants and conditions on Tenant’s part to be performed. In the event of a bona fide sale, subject to this lease, the Landlord shall have the right to transfer the security to the vendee for the benefit of the Tenant and the Landlord shall be considered released by the Tenant from all liability for the return of such security; and the Tenant agrees to look to the new Landlord solely for the return of the said security, and it is agreed that this shall apply to every transfer or assignment made of the security to a new Landlord.

 

16th. That the security deposited under this lease shall not be mortgaged, assigned or encumbered by the Tenant without the written consent of the Landlord.

 

17th. It is expressly understood and agreed that in case the demised premises shall be deserted or vacated, or if default be made in the payment of the rent or any part thereof as herein specified, or if, without the consent of the Landlord, the Tenant shall sell, assign, or mortgage this lease or if default be made in the performance of any of the covenants and agreements in this lease contained on the part of the Tenant to be kept and performed, or if the Tenant shall fail to comply with any of the statutes, ordinances, rules, orders, regulations and requirements of the Federal, State and Local Governments or of any and all their Departments and Bureaus, applicable to said premises, or if the Tenant shall file or there be filed against Tenant a petition in bankruptcy or arrangement, or Tenant be adjudicated a bankrupt or make an assignment for the benefit of creditors or take advantage of any insolvency act, the Landlord may, if the Landlord so elects, at any time thereafter terminate this lease and the term hereof, on giving to the Tenant five days’ notice in writing of the Landlord’s intention so to do, and this lease and the term hereof shall expire and come to an end on the date fixed in such notice as if the said date were the date originally fixed in this lease for the expiration hereof. Such notice may be given by mail to the Tenant addressed to the demised premises.

 

18th. Tenant shall pay to Landlord the rent or charge, which may, during the demised term, be assessed or imposed for the water used or consumed in or on the said premises, whether determined by meter or otherwise, as soon as and when the same may be assessed or imposed, and will also pay the expenses for the setting of a water meter in the said premises should the latter be required. Tenant shall pay Tenant’s proportionate part of the sewer rent or charge imposed upon the building. All such rents or charges or expenses shall be paid as additional rent and shall be added to the next month’s rent thereafter to become due.

 

19th. That the Tenant will not nor will the Tenant permit undertenants or other persons to do anything in said premises, or bring anything into said premises, or permit anything to be brought into said premises or to be kept therein, which will in any way increase the rate of fire insurance on said demised premises, nor use the demised premises or any part thereof, nor suffer or permit their use for any business or purpose which would cause an increase in the rate of fire insurance on said building, and the Tenant agrees to pay on demand any such increase. 

 

20th. The failure of the Landlord to insist upon a strict performance of any of the terms, conditions and covenants herein, shall not be deemed a waiver of any rights or remedies that the Landlord may have, and shall not be deemed a waiver of any subsequent breach or default in the terms, conditions and covenants herein contained. This instrument may not be changed, modified, discharged or terminated orally.

 

21st. If the whole or any part of the demised premises shall be acquired or condemned by Eminent Domain for any public or quasi public use or purpose, then and in that event, the term of this lease shall cease and terminate from the date of title vesting in such proceeding and Tenant shall have no claim against Landlord for the value of any unexpired term of said lease. No part of any award shall belong to the Tenant.

 

	
Rider to lease Agreement dated February 15,2017, by and between 3661 Horseblock Associates, L.L.C., as Landlord and Chembio Diagnostic Systems Inc., as Tenant:

 

28th: that the tenant, at its own cost and expense shall procure and maintain throughout the term of the lease, an insurance policy commonly known as “Owner, Landlord, and Tenant” insurance in the amount of One Million Dollars($1,000,000.00) for bodily injury and Five Hundred Thousand Dollars ($500,000.00) for property damage, naming both the landlord and the tenant payable as their interest may appear, covering said premises. Said original O.L. & T. Policy or certificate thereof, shall be deposited with the landlord and the commencement of the lease. Upon failure of the tenant to so deposit said O.L. & T. Policy and keep same currently paid, the landlord shall have the privilege to procure said insurance on its own application thereof and the amount of the premium if paid by landlord, shall be due and payable with the rent installment next due and shall be considered additional rent reserved hereunder, collectible with the same remedies as if originally reserved as rent hereunder.

 

29th: The landlord will procure and maintain a fire insurance policy covering said premises during the term of said lease. If as a result of any hazards or conditions caused by the tenant, the fire insurance premium payable by the landlord on the policy shall increase over the basic minimum therefore, the tenant shall reimburse the landlord the entire amount of any such increase as shall be directly allocable to the said tenant’s use and occupancy and the amount of such increase in the fire insurance premium shall be collectible by the landlord from the tenant with the same remedies as if originally reserved as rent hereunder.

 

30th: In addition to the rental provided herein, the tenant shall also pay, as additional rent, 86.90% of any increases in the dollar taxes which are assessed on the entire land, building and parking lot. The base year will be 2011/2012 real estate tax.

 

The foregoing further additional rent shall be due and payable from the tenant on the 30th Day after the mailing of notice from the landlord demanding such additional rent, and shall be paid in semi-annual installment.

1

For the purposes of this paragraph, the word “taxes” shall mean all real estate taxes, assessments, water and sewer rents and charges and governmental, municipal duty and charges of every kind and nature whatsoever extraordinary as well as ordinary and whether now in the contemplation of the parties, or not, and every and each installment of each of them, which shall, or may during the term of the lease be charges, laid, levied assessed or imposed upon or become a lien or liens upon the demised premises or any part thereof, or upon sidewalks, street, in front of and/or adjoining the demised premises or which may become due payable with respect thereto, and any and all taxes charged, levied, laid, assessed or imposed in lieu of or in addition to the foregoing requirements, orders, directions, ordinances, of the United States of America, or of the State, County, or City government or any other municipal, governmental or lawful authority whatsoever and gas, electricity or any other services to the demised premises or the occupants thereof during the term hereof and all fees and charges of the State, County or City government or any other municipal, governmental or lawful authority whatsoever, for the construction, maintenance or use during the term hereof, of any part of any building of the premises within the limit of the street.

 

31st: If the landlord commences any action or proceeding for rent, additional rent, or any dispossess proceeding, tenant agrees to pay the sum of SIX HUNDRED DOLLARS ($600.00) as the for landlord’s attorney’s or agent fees, if successful, together with interest, costs, disbursements. Said attorney’s fees shall be deemed to be additional rent for the month in which proceeding is concluded.

 

32nd: No counterclaim, set-off or claim for reduction shall be made by tenant in any action, for the premises by landlord, summary proceeding or any other proceeding brought by landlord under this lease for the payment of any rent, additional rent, or other charge, or for the enforcement of any of the provisions of this lease or the rules and regulations established hereunder.

 

33rd: All references herein to the landlord’s “consent” shall be deemed to mean landlords “prior written consent”.

 

34th: Tennant shall have no power to do any act or make any contract which may create or be the foundation for any lien, mortgage or other encumbrance upon the reversion of other estates of landlord or any interest of landlord in the premises or in the building or improvements thereon. Should tenant cause any alterations, rebuilding, replacements, changes, additions, improvements or repairs to be made to the premises, or labor performed or material furnished therein, thereon or thereto, neither the landlord nor the premises shall, under any circumstances, be liable for the payment of any expense incurred for the value of any work done or material furnished, but all such alterations, rebuilding, replacements, changes, additions, improvements and repairs and labor and material shall be made, furnished and performed at tenant’s expense, and tenant shall be solely and wholly responsible to contractors, laborers and material furnishing and performing such labor and material.

2

48th: Tenants represent that they are aware that the premises herein are subject to the requirements set forth in article VII of the Suffolk County Sanitary code set forth in the Covenants and Restrictions recorded in Liber 10311, page 513. Tenant agrees to comply with the terms of said Article VII. Violation of this paragraph shall constitute a material breach of this lease.

 

49th: The tenant shall not store or park any unregistered vehicle in the parking lot.

 

50th: When said lease is expired and the tenant vacates the premises, the tenant is responsible to clean units, sanitize bathrooms and remove all garbage from inside and outside of premises. .Any other improvements are the responsibility of the tenant.

 

51st 3661 Horseblock Associates LLC must notify in writing, 3 months in advance for 3 year option May 1, 2020 to April 30, 2023. There will be a 2 1/2% per year increase for each year. Notification should be sent in writing three months before lease expires. We must be notified by January 31, 2020.

52nd Landlord hereby agrees to notify tenant, Chembio Diagnostic Systems Inc., if and when the building herein goes for sale. Parties agree that this is not a right of first refusal or an option to purchase, but merely a courtesy extended to tenant.

 

3661 HORSEBLOCK ASSOCIATES, L.L.C.

	 	 	 	 
	 	
BY:

	 	 
	 	 	
Lorraine Schmidt

	 

	 	
BY:

	 	 
	 	 	
Chembio Diagnostic Systems Inc.

	 

5

 

ACKNOWLEDGMENT

 

	State of New York, County of	ss.:
	On	before me, the undersigned,
	personally appeared	 

 

personally known to me or proved to me on the basis of satisfactory evidence to be the individual(s) whose name(s) is (are) subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their capacity(ies), and that by his/her/their signature(s) on the instrument, the individual(s), or the person upon behalf of which the individual(s) acted, executed the instrument.

 

	 	 
	 	(signature and office of individual taking acknowledgment)

 

ACKNOWLEDGMENT

 

	State of	County of	ss.:
	On	before me, the undersigned,
	personally appeared	 	 

 

personally known to me or proved to me on the basis of satisfactory evidence to be the individual(s) whose name(s) is (are) subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their capacity(ies), and that by his/her/their signature(s) on the instrument, the individual(s), or the person upon behalf of which the individual(s) acted, executed the instrument.

 

	 	 
	 	(signature and office of individual taking acknowledgment)

ACKNOWLEDGMENT BY SUBSCRIBING WITNESS(ES)

 

 

	State of

 County of	} ss.:

 

 

	On	before me, the undersigned,
	personally appeared	

 

the subscribing witness(es) to the foregoing instrument, with whom I am personally acquainted, who, being by me duly sworn, did depose and say that he/she/they reside(s) in (if the place of residence is in a city, include the street and street number, if any, thereof); 

 

that he/she/they know(s)

 

to be the individual(s) described in and who executed the foregoing instrument; that said subscribing witness(es) was (were) present and saw said

 

execute the same; and that said witness(es) at the same time subscribed his/her/their name(s) as a witness(es) thereto.

(☐ if taken outside New York State insert city or political subdivision and state or country or other place acknowledgment taken And that said subscribing witness(es) made such appearance before the undersigned in

 

	 	 
	 	)

 

 

	 	 
	 	(signature and office of individual taking acknowledgment)

 

 

 

In Consideration of the letting of the premises within mentioned to the within named Tenant and the sum of $1.00 paid to the undersigned by the within named Landlord, the undersigned do          hereby covenant and agree, to and with the Landlord and the Landlord’s legal representatives, that if default shall at any time be made by the said Tenant in the payment of the rent and the performance of the covenants contained in the within lease, on the Tenant’s part to be paid and performed, that the undersigned will well and truly pay the said rent, or any arrears thereof, that may remain due unto the said Landlord, and also pay all damages that may arise in consequence of the non-performance of said covenants, or either of them, without requiring notice of any such default from the said Landlord. The undersigned hereby waives all right to trial by jury in any action or proceeding hereinafter instituted by the Landlord, to which the undersigned may be a party.

In WitnessWhereof, the undersigned(s) signed this Guaranty on

 

	
WITNESS

	 	 L. S.

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