Document:

Exhibit 10.1

 

FIRST AMENDMENT TO LEASE

 

THIS FIRST AMENDMENT TO LEASE dated as of this 23rd day of July, 2010 by and between
BOSTON PROPERTIES LIMITED PARTNERSHIP, a Delaware limited partnership (“Landlord”)
and A123 SYSTEMS, INC., a Delaware corporation (“Tenant”).

 

RECITALS

 

By Lease dated May 19, 2010 (the “Lease”), Landlord
did lease to Tenant and Tenant did hire and lease from Landlord certain
premises containing 87,924 square feet of rentable floor area (the “Rentable
Floor Area of the Initial Premises”) on the first (1st),
second (2nd) and third (3rd) floors of the
building (the “Building”) known as and numbered 200 West Street, Waltham,
Massachusetts (referred to in the Lease as the “Premises” and hereinafter
sometimes referred to as the “Initial Premises”).

 

Section 17.2 of the Lease contemplates that
Landlord and Tenant execute an amendment to the Lease in order to document the
inclusion of the Third Floor Expansion Premises, comprised of additional 9,318
square feet of rentable floor area (the “Rentable Floor Area of the Third Floor
Expansion Premises”) located on the third (3rd)
floor of the Building, into the Premises (which Third Floor Expansion Premises
is shown on Exhibit F attached to the Lease).

 

Landlord and Tenant are entering into this instrument to
set forth said leasing of the Third Floor Expansion Premises, to integrate the
Third Floor Expansion Premises into the Lease and to amend the Lease.

 

NOW THEREFORE, in consideration of One Dollar ($1.00)
and other good and valuable consideration in hand this date paid by each of the
parties to the other, the receipt and sufficiency of which are hereby severally
acknowledged, and in further consideration of the mutual promises herein
contained, Landlord and Tenant hereby agree to and with each other as follows:

 

1.                                       Effective as of the Third Floor Expansion Premises Commencement Date (as
defined in Section 5 below), the Third Floor Expansion Premises shall
constitute a part of the “Premises” demised to Tenant under the Lease, so that
the Premises (as defined in Section 1.2 of the Lease) shall include both
the Initial Premises and the Third Floor Expansion Premises and shall contain a
total of 97,242 square feet of rentable floor area.  By way of example the option to extend the
Term of the Lease provided in Section 3.2 of the Lease shall apply to both
the Initial Premises and the Third Floor Expansion Premises collectively but
not to either space independently.

 

2.                                       The Term of the Lease for both the Initial Premises and the Third Floor
Expansion Premises shall be coterminous. 
Accordingly, the definition of the “Lease Term” as set 

 

1

 

forth in Section 1.2 of the Lease is hereby
amended by deleting the definition therein set forth and substituting therefor
the following:

 

Lease
Term:                                (i)            As to the Initial
Premises, the period beginning on the Commencement Date and ending on the last
day of the one hundred twentieth (120th) full
calendar month immediately following the Commencement Date, unless extended or
sooner terminated as hereinafter provided.

 

(ii)           As
to the Third Floor Expansion Premises, a period beginning on the Third Floor
Expansion Premises Commencement Date and ending on the last day of the one
hundred twentieth (120th) full calendar month
immediately following the Commencement Date, unless extended or sooner
terminated as hereinafter provided.

 

3.                                       (A)          Annual Fixed Rent for
the Initial Premises shall continue to be payable as set forth in the Lease.

 

(B)           During
the period commencing on the Third Floor Expansion Premises Commencement Date
and ending on the last day of the sixtieth (60th) full
calendar month immediately following the Commencement Date, Annual Fixed Rent
for the Third Floor Expansion Premises shall be payable at the annual rate of
$232,950.00 (being the product of (i) $25.00 and (ii) the Rentable
Floor Area of the Third Floor Expansion Premises (being 9,318 square feet)).

 

(C)           During
the period commencing on the first day of the sixty-first (61st) full calendar month immediately following the Commencement Date and
ending on the last day of the Original Lease Term, Annual Fixed Rent for the
Third Floor Expansion Premises shall be payable at the annual rate of
$251,586.00 (being the product of (i) $27.00 and (ii) the Rentable
Floor Area of the Third Floor Expansion Premises).

 

(D)          Annual
Fixed Rent for the Premises during any extension option period (if exercised)
shall be payable as set forth in Section 3.2 of the Lease.

 

4.                                       For the purposes of computing Tenant’s payments for electricity (as
determined pursuant to Section 5.2 of the Lease), Landlord’s Tax Expenses
Allocable to the Premises (as determined pursuant to Section 6.1 of the
Lease) and Operating Expenses Allocable to the Premises (as determined pursuant
to Section 7.4 of the Lease), for the portion of the Term on and after the
Third Floor Expansion Premises Commencement Date, the “Rentable Floor Area of
the Premises” shall comprise a total of 97,242 square feet including both the
Rentable Floor Area of the Initial Premises (being 87,924 square feet) and the
Rentable Floor Area of the Third Floor Expansion Premises (being 9,318 square
feet).  For the portion of the Lease Term
prior to the Third Floor Expansion Premises

 

2

 

Commencement Date, the “Rentable Floor Area of
the Premises” shall continue to be the Rentable Floor Area of the Initial
Premises for such purposes.

 

5.                                       (A)          It is understood and
agreed that, except as may otherwise be expressly provided in this Section 5,
the terms and provisions of Exhibits B-1, B-2, B-3, B-4, B-5 and B-6 of the
Lease shall apply to the design and construction of the Tenant Improvement Work
in the Third Floor Expansion Premises.

 

(B)           Assuming
that the Tenant Improvement Work to be performed by Landlord in the Third Floor
Expansion Premises is shown on the Interim Plans and the Tenant Plans to be
delivered by Tenant to Landlord in accordance with Section 1.1 of Exhibit B-1
to the Lease, the Tenant Improvement Work in the Third Floor Expansion Premises
shall be deemed to be a part of the Landlord’s Work, as if the Third Floor
Expansion Premises were part of the Initial Premises. Accordingly, the “Third
Floor Expansion Premises Commencement Date” shall be the Commencement Date, as
determined in accordance with Section 1.3 of Exhibit B-1 to the
Lease, subject, however, to the provisions of Section 17.2(D) of the
Lease and to the provisions of the immediately following paragraph.

 

Notwithstanding anything contained in the Lease
or herein to the contrary, in the event that any holding over by the
then-current occupant of the Third Floor Expansion Premises causes a delay in
Landlord’s ability to perform the Tenant Improvement Work in the Third Floor
Expansion Premises (Landlord hereby representing that it delivered a
termination notice under the ClickSquared Lease on May 19, 2010), the
Commencement Date for the Initial Premises shall continue to be as determined
in accordance with Section 1.3 of Exhibit B-1 to the Lease
notwithstanding the fact that the Tenant Improvement Work in the Third Floor
Expansion Premises has not been Substantially Completed (and the Third Floor
Expansion Premises shall be as determined pursuant to Section 17.2(D) of
the Lease).

 

(C)           Notwithstanding
anything contained in the Lease or herein to the contrary, in the event that
the Tenant Improvement Work in the Third Floor Expansion Premises has not been
Substantially Completed on or before the Estimated Commencement Date as the
result of any (i) Tenant Delay, (ii) Landlord’s Force Majeure or (iii) holding
over by the then-current occupant of the Third Floor Expansion Premises (any of
the foregoing clauses (i) through (iii) being a “Permitted Delay”),
but Landlord would otherwise be entitled to the four percent (4%) Construction
Management Fee under Section 1.1(C) of Exhibit B-1 to the Lease
with respect to the remainder of the Landlord’s Work, then Landlord shall
nonetheless be entitled to such four percent (4%) Construction Management Fee
and the costs of the Tenant Improvement Work in the Third Floor Expansion
Premises shall be included within the hard construction costs on which the
Construction Management Fee is based; provided, however, that for the avoidance
of doubt Landlord acknowledges and agrees that in the event that the Tenant Improvement
Work in the Third Floor Expansion Premises has not been Substantially Completed
on or before the Estimated Commencement Date as the result of any reason other
than a

 

3

 

Permitted Delay, then Landlord shall not be
entitled to the four (4%) Construction Management Fee under Section 1.1(C) of
Exhibit B-1 to the Lease with respect to all or any portion of the
Landlord’s Work.

 

6.                                       Tenant and Landlord warrant and represent that neither party has dealt
with any broker in connection with the consummation of this Lease other than
the broker, person or firm designated in Section 1.2 of the Lease; and in
the event any claim is made against either party relative to dealings with
brokers other than the broker designated in said Section 1.2, the other
party shall defend the claim against such party with counsel of the other party’s
selection and save harmless and indemnify such party on account of loss, cost
or damage which may arise by reason of such claim. Landlord agrees that it
shall be solely responsible for the payment of brokerage commissions to the
broker, person or firm designated in Section 1.2 of the Lease in
connection with the Original Lease Term.

 

7.                                       Except as otherwise expressly provided herein, all capitalized terms used
herein without definition shall have the same meanings as are set forth in the
Lease.

 

8.                                       Except as herein amended the Lease shall remain unchanged and in full
force and effect.  All references to the “Lease”
shall be deemed to be references to the Lease as herein amended.

 

4

 

EXECUTED as a sealed instrument as of the date and year
first above written.

 

 

	
   

  	
  LANDLORD:

  
	
   

  	
   

  
	
   

  	
  BOSTON PROPERTIES LIMITED PARTNERSHIP

  
	
   

  	
   

  
	
   

  	
  By:

  	
  Boston Properties, Inc., its general
  partner

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/ David C. Provost

  
	
   

  	
   

  	
  Name:

  	
  David C. Provost

  
	
   

  	
   

  	
  Title:

  	
  Senior Vice President Boston Properties

  

 

 

	
   

  	
  TENANT:

  
	
   

  	
   

  
	
  ATTEST:

  	
  A123 SYSTEMS, INC.

  
	
   

  	
   

  	
   

  
	
  By:

  	
  /s/ Eric Pyenson

  	
   

  	
  By:

  	
  /s/ Michael Rubino

  
	
  Name:

  	
  Eric Pyenson

  	
   

  	
  Name:

  	
  Michael Rubino

  
	
  Title:

  	
  Secretary or Assistant Secretary

  	
   

  	
  Title:

  	
  President or Vice President, CFO

  
	
   

  	
   

  	
   

  	
   

  	
  Hereunto duly authorized

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
  /s/ John Granara

  
	
   

  	
   

  	
   

  	
  Name:

  	
  John Granara

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Treasurer or Assistant Treasurer

  
	
   

  	
   

  	
   

  	
   

  	
  Hereunto duly authorized

  

 

5Exhibit 10.2

 

FLANDERS 155 LLC

 

155 Flanders Road

 

Westborough, Massachusetts

 

Lease to

 

A123 SYSTEMS, INC.

 

THE
SUBMISSION OF THIS LEASE FOR EXAMINATION, REVIEW, NEGOTIATION AND/OR SIGNATURE
SHALL NOT CONSTITUTE AN OFFER OR AN OPTION TO LEASE OR A RESERVATION OF THE
PREMISES AND IS SUBJECT TO WITHDRAWAL OR MODIFICATION AT ANY TIME BY EITHER
PARTY.  THIS LEASE SHALL BECOME EFFECTIVE
AND BINDING ONLY IF AND WHEN IT SHALL BE EXECUTED AND DELIVERED BY BOTH
LANDLORD AND TENANT.

 

 

Table Of Contents By Articles And
Sections

 

	
  ARTICLE

  	
   

  	
  SECTION

  	
   

  	
  PAGE

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 1
  Reference Data and Definitions

  	
   

  	
  1

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  1.01

  	
  Reference Data

  	
   

  	
  1

  
	
   

  	
   

  	
  1.02

  	
  General Provisions

  	
   

  	
  3

  
	
   

  	
   

  	
  1.03

  	
  Terms Defined

  	
   

  	
  4

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 2
  Premises

  	
   

  	
  11

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  2.01

  	
  Premises

  	
   

  	
  11

  
	
   

  	
   

  	
  2.02

  	
  Appurtenances

  	
   

  	
  11

  
	
   

  	
   

  	
  2.03

  	
  Reservations By Landlord

  	
   

  	
  11

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 3
  Term

  	
   

  	
  11

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  3.01

  	
  Term Commencement

  	
   

  	
  11

  
	
   

  	
   

  	
  3.02

  	
  Termination

  	
   

  	
  11

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 4
  Rent

  	
   

  	
  12

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  4.01

  	
  Basic Rent

  	
   

  	
  12

  
	
   

  	
   

  	
  4.02

  	
  Computation of Basic Rent

  	
   

  	
  12

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 5
  Use of Premises

  	
   

  	
  12

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  5.01

  	
  Use Restricted

  	
   

  	
  12

  
	
   

  	
   

  	
  5.02

  	
  Rules and Regulations

  	
   

  	
  12

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 6
  Taxes; Operating Expenses; Estimated Cost of Electrical Services

  	
   

  	
  12

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  6.01

  	
  Expenses and Taxes

  	
   

  	
  12

  
	
   

  	
   

  	
  6.02

  	
  Annual Statement of Additional Rent Due

  	
   

  	
  13

  
	
   

  	
   

  	
  6.03

  	
  Monthly Payments of Additional Rent

  	
   

  	
  13

  
	
   

  	
   

  	
  6.04

  	
  Accounting Periods

  	
   

  	
  13

  
	
   

  	
   

  	
  6.05

  	
  Abatement of Taxes

  	
   

  	
  13

  
	
   

  	
   

  	
  6.06

  	
  Electric and Gas Service

  	
   

  	
  14

  
	
   

  	
   

  	
  6.07

  	
  Late Payment of Rent and Late Charges

  	
   

  	
  14

  
	
   

  	
   

  	
  6.08

  	
  Tenant Audit Right

  	
   

  	
  15

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 7
  Improvements, Repairs, Additions, Replacements

  	
   

  	
  16

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  7.01

  	
  Preparation of the Premises

  	
   

  	
  16

  
	
   

  	
   

  	
  7.02

  	
  Alterations and Improvements

  	
   

  	
  16

  
	
   

  	
   

  	
  7.03

  	
  Maintenance By Tenant

  	
   

  	
  18

  
	
   

  	
   

  	
  7.04

  	
  Redelivery

  	
   

  	
  18

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 8
  Landlord’s Obligations

  	
   

  	
  18

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  8.01

  	
  Maintenance By Landlord

  	
   

  	
  18

  

 

 

	
  ARTICLE

  	
   

  	
  SECTION

  	
   

  	
  PAGE

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  8.02

  	
  Limitations on Landlord’s Liability

  	
   

  	
  19

  
	
   

  	
   

  	
  8.03

  	
  Tenant’s Right to Self Help

  	
   

  	
  19

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 9
  Tenant’s Particular Covenants

  	
   

  	
  19

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  9.01

  	
  Pay Rent

  	
   

  	
  19

  
	
   

  	
   

  	
  9.02

  	
  Occupancy of the Premises

  	
   

  	
  19

  
	
   

  	
   

  	
  9.03

  	
  Safety

  	
   

  	
  20

  
	
   

  	
   

  	
  9.04

  	
  Equipment

  	
   

  	
  20

  
	
   

  	
   

  	
  9.05

  	
  Electrical Requirements

  	
   

  	
  20

  
	
   

  	
   

  	
  9.06

  	
  Pay Taxes

  	
   

  	
  20

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 10
  Requirements of Public Authority

  	
   

  	
  20

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  10.01

  	
  Legal Requirements

  	
   

  	
  20

  
	
   

  	
   

  	
  10.02

  	
  Contests

  	
   

  	
  21

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 11
  Covenant Against Liens

  	
   

  	
  22

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  11.01

  	
  Mechanics’ Liens

  	
   

  	
  22

  
	
   

  	
   

  	
  11.02

  	
  Right to Discharge

  	
   

  	
  22

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 12
  Access to Premises

  	
   

  	
  22

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  12.01

  	
  Access

  	
   

  	
  22

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 13
  Assignment and Subletting: Occupancy Arrangements

  	
   

  	
  23

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  13.01

  	
  Subletting and Assignment

  	
   

  	
  23

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 14
  Indemnity

  	
   

  	
  24

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  14.01

  	
  Tenant’s Indemnity

  	
   

  	
  24

  
	
   

  	
   

  	
  14.02

  	
  Landlord’s Liability

  	
   

  	
  25

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 15
  Insurance

  	
   

  	
  25

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  15.01

  	
  Liability Insurance

  	
   

  	
  25

  
	
   

  	
   

  	
  15.02

  	
  Casualty Insurance

  	
   

  	
  25

  
	
   

  	
   

  	
  15.03

  	
  Certificates

  	
   

  	
  25

  
	
   

  	
   

  	
  15.04

  	
  Landlord Insurance

  	
   

  	
  26

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 16
  Waiver of Subrogation

  	
   

  	
  26

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  16.01

  	
  Waiver of Subrogation

  	
   

  	
  26

  
	
   

  	
   

  	
  16.02

  	
  Waiver of Rights

  	
   

  	
  26

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 17
  Damage or Destruction

  	
   

  	
  26

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  17.01

  	
  Damage by Fire, Casualty, Eminent Domain

  	
   

  	
  26

  

 

ii

 

	
  ARTICLE

  	
   

  	
  SECTION

  	
   

  	
  PAGE

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  17.02

  	
  Restoration

  	
   

  	
  28

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 18
  Eminent Domain

  	
   

  	
  28

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  18.01

  	
  Total Taking

  	
   

  	
  28

  
	
   

  	
   

  	
  18.02

  	
  Partial Taking

  	
   

  	
  28

  
	
   

  	
   

  	
  18.03

  	
  Awards and Proceeds

  	
   

  	
  28

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 19
  Quiet Enjoyment; Mortgagee’s Rights

  	
   

  	
  29

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  19.01

  	
  Landlord’s Covenant

  	
   

  	
  29

  
	
   

  	
   

  	
  19.02

  	
  Superiority of Lease: Option to Subordinate

  	
   

  	
  29

  
	
   

  	
   

  	
  19.03

  	
  Notice to Mortgagee

  	
   

  	
  29

  
	
   

  	
   

  	
  19.04

  	
  Other Provisions Regarding Mortgagees

  	
   

  	
  29

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 20
  Defaults; Events of Default

  	
   

  	
  30

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  20.01

  	
  Defaults

  	
   

  	
  30

  
	
   

  	
   

  	
  20.02

  	
  Extended Cure Period

  	
   

  	
  30

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 21
  Insolvency

  	
   

  	
  31

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  21.01

  	
  Insolvency

  	
   

  	
  31

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 22
  Landlord’s Remedies; Damages on Default

  	
   

  	
  31

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  22.01

  	
  Landlord’s Remedies

  	
   

  	
  31

  
	
   

  	
   

  	
  22.02

  	
  Surrender

  	
   

  	
  31

  
	
   

  	
   

  	
  22.03

  	
  Right to Relet

  	
   

  	
  31

  
	
   

  	
   

  	
  22.04

  	
  Survival of Covenants

  	
   

  	
  32

  
	
   

  	
   

  	
  22.05

  	
  Right to Equitable Relief

  	
   

  	
  33

  
	
   

  	
   

  	
  22.06

  	
  Landlord’s Right to Self Help; Interest on Overdue Rent

  	
   

  	
  33

  
	
   

  	
   

  	
  22.07

  	
  Payment of Landlord’s Cost of Enforcement

  	
   

  	
  33

  
	
   

  	
   

  	
  22.08

  	
  Further Remedies

  	
   

  	
  33

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 23
  Waivers; Landlord Default

  	
   

  	
  34

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  23.01

  	
  No Waivers

  	
   

  	
  34

  
	
   

  	
   

  	
  23.02

  	
  Landlord Default

  	
   

  	
  34

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 24
  Security Deposit

  	
   

  	
  34

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  24.01

  	
  Security Deposit

  	
   

  	
  34

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 25
  General Provisions

  	
   

  	
  35

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  25.01

  	
  Force Majeure

  	
   

  	
  35

  
	
   

  	
   

  	
  25.02

  	
  Notices and Communications

  	
   

  	
  35

  

 

iii

 

	
  ARTICLE

  	
   

  	
  SECTION

  	
   

  	
  PAGE

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  25.03

  	
  Tenant Estoppel Certificate

  	
   

  	
  35

  
	
   

  	
   

  	
  25.04

  	
  Governing Law

  	
   

  	
  36

  
	
   

  	
   

  	
  25.05

  	
  Partial Invalidity

  	
   

  	
  36

  
	
   

  	
   

  	
  25.06

  	
  Notice of Lease

  	
   

  	
  36

  
	
   

  	
   

  	
  25.07

  	
  Interpretation

  	
   

  	
  36

  
	
   

  	
   

  	
  25.08

  	
  Bind and Inure; Limitation of Landlord’s Liability

  	
   

  	
  36

  
	
   

  	
   

  	
  25.09

  	
  Parties

  	
   

  	
  37

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 26
  Miscellaneous

  	
   

  	
  37

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  26.01

  	
  Holdover

  	
   

  	
  37

  
	
   

  	
   

  	
  26.02

  	
  Reciprocal Litigation Costs

  	
   

  	
  37

  
	
   

  	
   

  	
  26.03

  	
  Brokerage

  	
   

  	
  37

  
	
   

  	
   

  	
  26.04

  	
  Landlord’s Expenses Regarding Consents

  	
   

  	
  37

  
	
   

  	
   

  	
  26.05

  	
  Financial Statements

  	
   

  	
  38

  
	
   

  	
   

  	
  26.06

  	
  Signage

  	
   

  	
  38

  
	
   

  	
   

  	
  26.07

  	
  Option to Extend Term

  	
   

  	
  38

  
	
   

  	
   

  	
  26.08

  	
  Tenant’s Option to Terminate

  	
   

  	
  39

  
	
   

  	
   

  	
  26.09

  	
  Expansion; Right of First Offer

  	
   

  	
  39

  
	
   

  	
   

  	
  26.10

  	
  HVAC

  	
   

  	
  41

  
	
   

  	
   

  	
  26.11

  	
  Generator

  	
   

  	
  42

  
	
   

  	
   

  	
  26.12

  	
  LN2 Tank

  	
   

  	
  42

  
	
   

  	
   

  	
  26.13

  	
  Test Trailer

  	
   

  	
  42

  
	
   

  	
   

  	
  26.14

  	
  Patio

  	
   

  	
  42

  
	
   

  	
   

  	
  26.15

  	
  Smoking Area

  	
   

  	
  42

  
	
   

  	
   

  	
  26.16

  	
  Loading

  	
   

  	
  42

  
	
   

  	
   

  	
  26.17

  	
  Parking

  	
   

  	
  43

  
	
   

  	
   

  	
  26.18

  	
  Roof

  	
   

  	
  43

  
	
   

  	
   

  	
  26.19

  	
  Compliance with Laws

  	
   

  	
  43

  
	
   

  	
   

  	
  26.20

  	
  Environmental

  	
   

  	
  43

  
	
   

  	
   

  	
  26.21

  	
  Expedited Arbitration

  	
   

  	
  43

  
	
   

  	
   

  	
  26.22

  	
  Landlord Cooperation

  	
   

  	
  45

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 27
  Entire Agreement

  	
   

  	
  45

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  27.01

  	
  Entire Agreement

  	
   

  	
  45

  

 

iv

 

FLANDERS 155 LLC

155 Flanders Road

Westborough, Massachusetts

 

LEASE EXHIBITS

 

	
  Exhibit A:

  	
   

  	
  Legal
  Description

  	
   

  	
  47

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Exhibit B:

  	
   

  	
  Plan
  Showing Tenant’s Space

  	
   

  	
  48

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Exhibit C:

  	
   

  	
  Tenant
  Allowance and Landlord’s Work Obligations

  	
   

  	
  49

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Exhibit D:

  	
   

  	
  Services
  to be Provided by Landlord as Operating Expenses

  	
   

  	
  52

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Exhibit E:

  	
   

  	
  Rules and
  Regulations

  	
   

  	
  53

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Exhibit F:

  	
   

  	
  Tenant
  Estoppel Certificate

  	
   

  	
  55

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Exhibit G:

  	
   

  	
  Agreement
  of Subordination Nondisturbance and Attornment

  	
   

  	
  58

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Exhibit H:

  	
   

  	
  Certificate
  of Vote

  	
   

  	
  62

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Exhibit I:

  	
   

  	
  Parking

  	
   

  	
  63

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Exhibit J:

  	
   

  	
  Trash
  Removal

  	
   

  	
  64

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Exhibit K:

  	
   

  	
  Tenant
  Improvement Plans

  	
   

  	
  65

  

 

v

 

FLANDERS 155 LLC

155 Flanders Road

Westborough, Massachusetts

 

LEASE

 

STANDARD FORM

 

THIS
LEASE by and between FLANDERS 155 LLC, a Massachusetts limited liability
company, (“Landlord”) having a principal place of business at 116 Flanders
Road, Suite 2000, Westborough, Massachusetts 01581, and A123 SYSTEMS, INC., a
duly organized and existing Delaware corporation (“Tenant”) having a principal
place of business at 321 Arsenal Street, Watertown, Massachusetts 02472 (Tenant
Address).

 

W
I T N E S S E T H :

 

ARTICLE 1

Reference Data and Definitions

 

1.01        Reference
Data

 

	
  LANDLORD:

  	
   

  	
  Flanders
  155 LLC

  
	
   

  	
   

  	
   

  
	
  LANDLORD’S
  REPRESENTATIVE:

  	
   

  	
  Mr.
  Marc R. Verreault

  Senior Vice President, Finance

  Flanders 155 LLC

  
	
   

  	
   

  	
   

  
	
  LANDLORD’S
  ADDRESS:

  (FOR PAYMENT OF RENT)

  	
   

  	
  Flanders
  155 LLC

  116 Flanders Road, Suite 2000

  Westborough, Massachusetts 01581

  
	
   

  	
   

  	
   

  
	
  LANDLORD’S
  ADDRESS 

  (FOR NOTICE):

  	
   

  	
  Mr.
  Christopher F. Egan and

  Mr. Marc R. Verreault

  Flanders 155 LLC

  116 Flanders Road, Suite 2000

  Westborough, MA 01581

  
	
   

  	
   

  	
   

  
	
  With a copy to:   

  	
   

  	
  Joseph
  Jenkins, Esquire

  116 Flanders Road, Suite 1100

  Westborough, MA 01581

  
	
   

  	
   

  	
  Telephone:

  	
  508-898-3900

  
	
   

  	
   

  	
  Facsimile:

  	
  508-898-9777

  
	
   

  	
   

  	
   

  
	
  LANDLORD’S
  PHONE NUMBER:

  	
   

  	
  508-898-3800

  

 

1

 

	
  LANDLORD’S
  FACSIMILE NUMBER:

  	
   

  	
  508-898-3005

  
	
   

  	
   

  	
   

  
	
  TENANT:

  	
   

  	
  A123
  Systems, Inc.

  
	
   

  	
   

  	
   

  
	
  TENANT’S
  ADDRESS:

  	
   

  	
  A123
  Systems, Inc.

  321 Arsenal Street

  Watertown, MA 02472

  Attn: General Counsel

  
	
   

  	
   

  	
  Telephone:

  	
  617-778-5700

  
	
   

  	
   

  	
  Facsimile:

  	
  617-924-8910

  
	
   

  	
   

  	
   

  
	
  With a copy to:     

  	
   

  	
  Wilmer
  Cutler Pickering Hale and Dorr LLP

  60 State Street

  Boston, MA 02109

  
	
   

  	
   

  	
  Telephone:

  	
  617-526-6000

  
	
   

  	
   

  	
  Facsimile:

  	
  617-526-5000

  
	
   

  	
   

  	
  Email:  paul.jakubowski@wilmerhale.com

  
	
   

  	
   

  	
   

  
	
  TENANT’S
  REPRESENTATIVE:

  	
   

  	
  John
  Pinho, Director of Facilities

  
	
   

  	
   

  	
   

  
	
  PREMISES:

  	
   

  	
  The
  portion of the Building shown on Exhibit B attached hereto.

  
	
   

  	
   

  	
   

  
	
  RENTABLE
  AREA

  OF PREMISES:

  	
   

  	
  66,863
  Square Feet.

  
	
   

  	
   

  	
   

  
	
  RENTABLE
  AREA

  OF THE BUILDING:

  	
   

  	
  88,983
  Square Feet.

  
	
   

  	
   

  	
   

  
	
  TERM
  COMMENCEMENT DATE:

  	
   

  	
  The
  Term Commencement Date shall be as defined in Section 7.01.

  
	
   

  	
   

  	
   

  
	
  BASIC
  RENT COMMENCEMENT DATE:

  	
   

  	
  The
  Basic Rent Commencement Date shall be February 1, 2011.

  
	
   

  	
   

  	
   

  
	
  STATED
  EXPIRATION

  DATE:

  	
   

  	
  The
  Stated Expiration Date shall be January 31, 2021.

  

 

2

 

	
  BASIC
  RENT:

  	
   

  	
  SEE
  SCHEDULE BELOW:

  

 

	
  FROM

  	
   

  	
  TO

  	
   

  	
  MONTHLY RENT

  	
   

  	
  ANNUAL RENT

  	
   

  
	
  The Term Commencement Date

  	
   

  	
  January
  31, 2011

  	
   

  	
  $

  	
  0.00

  	
   

  	
  $

  	
  0.00

  	
   

  
	
  February 1, 2011

  	
   

  	
  December
  31, 2015

  	
   

  	
  $

  	
  33,425.00

  	
   

  	
  $

  	
  401,100.00

  	
   

  
	
  January 1, 2016

  	
   

  	
  January
  31, 2021

  	
   

  	
  $

  	
  38,995.83

  	
   

  	
  $

  	
  467,950.00

  	
   

  

 

	
  TENANT’S
  SHARE:

  	
   

  	
  75.24%

  
	
   

  	
   

  	
   

  
	
  GUARANTOR:

  	
   

  	
  None

  
	
   

  	
   

  	
   

  
	
  PERMITTED
  USES:

  	
   

  	
  Research
  and development, design, fabrication, component assembly, installation and
  testing of electric hybrid automotive and power solutions and
  administrative/general office use, warehousing, distribution and other lawful
  uses related to Tenant’s business operations.

  
	
   

  	
   

  	
   

  
	
  SECURITY
  DEPOSIT:

  	
   

  	
  $155,983.32

  

 

1.02        General
Provisions.

 

For
all purposes of the Lease unless otherwise expressed and provided herein or
therein or unless the context otherwise requires:

 

(a)           The words herein,
hereof, hereunder and other words of similar import refer to the
Lease as a whole and not to any particular article, section or other
subdivision of this Lease.

 

(b)           A pronoun in
one gender includes and applies to the other gender as well.

 

(c)           Each definition
stated in Section 1.01 or 1.03 of this Lease applies equally to the singular
and the plural forms of the term or expression defined.

 

(d)           Any reference
to a document defined in Section 1.03 of this Lease is to such document as
originally executed, or, if modified, amended or supplemented in accordance
with the provisions of this Lease, to such document as so modified, amended or
supplemented and in effect at the relevant time of reference thereto.

 

(e)           All accounting
terms not otherwise defined herein have the meanings assigned to them in
accordance with generally accepted accounting principles.

 

3

 

(f)            All references
in Section 1.01 hereof are subject to the specified definitions thereof (if
any) in Section 1.03 hereof.

 

1.03        Terms
Defined.

 

Each
term or expression set forth above in Section 1.01 hereof or below in this
Section 1.03 has the meaning stated immediately after it.

 

Additional
Landlord’s Work.  The work to be done by Landlord, entitled Additional
Landlord Work, as described in Exhibit C.

 

Additional Rent.  All sums which Tenant shall be obligated to
pay hereunder other than Basic Rent.

 

Affiliate.  With respect to any specified Person, any
other Person directly or indirectly controlling or controlled by or under
direct or indirect common control with such specified Person.  For the purposes of this definition, the term
“control”, when used with respect to any specified Person, means the power to
direct the management and policies of such Person, directly or indirectly,
whether through the ownership of voting securities, by contract or otherwise,
and the terms “controlling” and “controlled by” have meanings correlative to
the foregoing.

 

Authorizations.  All franchises, licenses, permits and other
governmental consents issued by Governmental Authorities pursuant to Legal
Requirements which are or may be required for the use and occupancy of the
Premises or the conduct or continuation of a Permitted Use therein.

 

Building. The Building located at
155 Flanders Road, Westborough, Massachusetts.

 

Calendar Year.  The First Calendar Year, the Last Calendar
Year and each full calendar year (January 1 through December 31) occurring
during the Lease Term.

 

Common Areas.  All areas devoted to the common use of
occupants of the Building or the provision of Services to the Building,
including but not limited to two (2) electrical rooms.  In the event Tenant exercises its expansion
right pursuant to Section 26.09, the entire Building shall be for Tenant’s sole
use and there shall be no Common Areas within the Building.

 

Control.  As defined in the definition of Affiliate.

 

Corporation.  A corporation, company, association, limited
liability company, business trust or similar organization wherever formed.

 

Default.  Any event or condition specified in Article
20 hereof so long as any applicable requirement for the giving of notice or
lapse of time or both have not been fulfilled.

 

Event of Default.  Any event or condition specified in (a)
Article 20 hereof (if all applicable periods for cure after the giving of
notice or lapse of time or both have expired) or (b) in Article 21 hereof.

 

4

 

First Calendar Year.  The partial Calendar Year period commencing
on the Term Commencement Date and ending on the next succeeding December 31.

 

Force Majeure.  Acts of God, strikes, lockouts, labor
troubles,  inability to procure
materials, failure of power, restrictive Legal Requirements, riots and
insurrection, acts of public enemy, wars, earthquakes, hurricanes and other
natural disasters, fires, explosions, other causes beyond a party’s reasonable
control, or any act, failure to act or Default of the other party to this
Lease;  provided, however, lack of money
shall not be deemed such a cause.

 

Governmental Authority.  United States of America, the Commonwealth of
Massachusetts, the Town of Westborough, County of Worcester, and any political
subdivision thereof and any agency, department, commission, board, bureau or
instrumentality of any of them.

 

Insolvency.  The occurrence with respect to any Person of
one or more of the following events: the death, dissolution, termination of
existence (other than by merger or consolidation), insolvency, appointment of a
receiver for all or substantially all of the property of such Person, the
making of a fraudulent conveyance or the execution of an assignment or trust
mortgage for the benefit of creditors by such Person, or the filing of a
petition in bankruptcy or the commencement of any proceedings by or against
such Person under a bankruptcy, insolvency or other law relating to the relief
or the adjustment of indebtedness, rehabilitation or reorganization of debtors;
provided that if such petition or commencement is involuntarily made against
such a Person and is dismissed within sixty (60) days of the date of such
filing or commencement, such event shall not constitute an Insolvency
hereunder.

 

Insurance Requirements.  All terms of any policy of insurance
maintained by Landlord or Tenant and applicable to (or affecting any condition,
operation, use or occupancy of) the Building or the Premises or any part or
parts of either and all requirements of the issuer of any such policy and all
orders, rules, regulations and other requirements of the National Board of Fire
Underwriters (or any other body exercising similar functions).

 

Land.  The land located at 155 Flanders Road,
Westborough, Massachusetts, County of Worcester, Commonwealth of Massachusetts,
described in Exhibit A.

 

Last Calendar Year.  The partial Calendar Year commencing on
January 1 of the Calendar Year in which the Lease Termination Date occurs and
ending on the Lease Termination Date.

 

Lease Term.  The period commencing on the Term
Commencement Date and ending on the Lease Termination Date.

 

Lease Termination Date.  The earliest to occur of (1) the Stated
Expiration Date, (2) the termination of this Lease by Landlord as the result of
an Event of Default, (3) the termination of this Lease pursuant to Article 17
(Damage or Destruction) or Article 18 (Eminent Domain) hereof, or (4) the
termination of this Lease pursuant to Section 26.08 (Tenant’s Option to
Terminate).

 

Lease Year.  A period commencing on the Term Commencement
Date (or an anniversary thereof) and ending on the day before the next
succeeding anniversary thereof.  For
example, the first Lease Year is

 

5

 

a
period commencing on the Term Commencement Date and ending on the day before
the first anniversary thereof.  The last
Lease Year shall end on the Lease Termination Date.

 

Legal Requirements.  All laws, statutes, codes, ordinances (and
all rules and regulations thereunder), all executive orders and other
administrative orders, judgments, decrees, injunctions and other judicial
orders of or by any Governmental Authority which may at any time be applicable
to the Building or the Premises or to any condition or use thereof and the
provisions of all Authorizations.

 

Occupancy Arrangement.  With respect to the Premises or any portion
thereof, and whether (a) written or unwritten or (b) for all or any portion of
the Lease Term, an assignment, a sublease, a tenancy at will, a tenancy at
sufferance, or any other arrangement (including but not limited to a license or
concession) pursuant to which a Person occupies, or shall have the right to
occupy, the Premises for any purpose.

 

Operating Expenses.  All reasonable expenses, costs, and
disbursements of every kind and nature which Landlord incurs during the Term in
connection with the operation and maintenance of the Building (including all
facilities in operation on the Term Commencement Date and such additional
facilities which are necessary or beneficial for the operation of the
Building), including, but not limited to (a) wages, salaries, fees and costs to
Landlord of all Persons at or below the grade of Property manager engaged in
connection therewith, including taxes, insurance, and benefits relating thereto
(but with respect to employees who are engaged both at the Building and other
buildings, all such costs shall be appropriately allocated); (b) the cost of
(i) all supplies and materials, electricity and lighting, (ii) water, heat, air
conditioning, and ventilating, (iii) all maintenance, janitorial, and service
agreements, (iv) all insurance, including the cost of casualty and liability
insurance, (v) repairs and maintenance including, without limitation, Landlord’s
costs and expenses of performing its obligations under Section 8.01 but
excluding costs and expenses which may be capital in nature except to the
extent permitted under clause (vi) following, (vi) capital expenditures which
are primarily for the purpose of reducing Operating Expenses or which may be
required by a Governmental Authority, amortized over the reasonable life of the
capital items with the reasonable life and amortization schedule being
determined by Landlord in accordance with generally accepted accounting
principles (provided that in the event the reasonably estimated annual savings
arising from the installation of any such capital improvement intended to
reduce Operating Expenses shall exceed such annual amortization, Operating
Expenses shall include, in lieu of such amortization, such estimated annual
savings until the cost of such improvement shall have been completely
amortized), (vii) pursuing an application for an abatement of taxes pursuant to
Section 6.05 hereof to the extent not deducted from the abatement, if any,
received; (viii) an allocable portion of Landlord’s independent auditor and
central accounting expenses; (c) management fees at the rate of 3.5% of gross
collections; and (d) the cost to Landlord of operating, repairing and
maintaining exterior common areas and facilities, including those services
listed on “Exhibit D” attached hereto, which may not be located entirely on the
Land but which may be used for parking or for landscaping, security and
maintenance for common roadways and open areas.

 

Notwithstanding
anything to the contrary set forth in this Lease, Operating Expenses shall not
include the following:

 

6

 

(i)            any ground or
underlying lease rental;

 

(ii)           bad debt
expenses and interest, principal, points and fees on debts or amortization on
any mortgage or other debt instrument encumbering the Building or the Land;

 

(iii)          costs which may
be considered capital improvements, capital repairs, capital changes (including
capital improvements to the Building systems) or any other capital costs as
determined under generally accepted accounting principles except for capital
expenditures expressly permitted pursuant to clause (vi) in the preceding
paragraph and except that, notwithstanding any other provisions of this to the
contrary, the cost of replacing any HVAC Equipment shall be an Operating Expense
in the year incurred;

 

(iv)         rentals for
items which if purchased, rather than rented, would constitute a capital cost;

 

(v)          costs incurred
by Landlord to the extent that Landlord is reimbursed by insurance proceeds or
is otherwise reimbursed;

 

(vi)         depreciation,
amortization and interest payments, except on equipment, materials, tools,
supplies and vendor type equipment purchased by Landlord to enable Landlord to
supply services Landlord might otherwise contract for with a third party where
such depreciation, amortization and interest payments would otherwise have been
included in the charge for such third party’s services, all as determined in
accordance with generally accepted accounting principles, consistently applied,
and when depreciation or amortization is permitted or required, the item shall
be amortized over its reasonably anticipated useful life;

 

(vii)        advertising and
promotional expenditures, and costs of acquisition and maintenance of
advertising signs in or on the Building identifying the owner of the Building
or solely other tenants;

 

(viii)       marketing
costs, including leasing commissions, attorneys’ fees (in connection with the
negotiation and preparation of letters, deal memos, letters of intent, leases,
subleases and/or assignments), space planning costs, and other costs and
expenses incurred in connection with lease, sublease and/or assignment
negotiations and transactions with present or prospective tenants or other
occupants of the Building;

 

(ix)          costs,
including permit, license and inspection costs, incurred with respect to the
installation of other tenants’ or other occupants’ improvements or incurred in
renovating or otherwise improving, decorating, painting or redecorating vacant
space for tenants or other occupants of the Building;

 

(x)           expenses in
connection with services or other benefits which are not available to Tenant or
for which Tenant is charged for directly;

 

(xi)          costs incurred
by Landlord due to the violation by Landlord or any other tenant of the terms
and conditions of any lease of space in the Building;

 

7

 

(xii)         management fees
paid or charged by Landlord in connection with the management of the Building
to the extent such management fee is in excess of the management fee specified
in clause (c) in the preceding paragraph;

 

(xiii)        rent for any
office space occupied by Building management personnel;

 

(xiv)        amounts paid to
Landlord or to subsidiaries or affiliates of Landlord for goods and/or services
in the Building to the extent the same exceeds the costs of such goods and/or
services rendered by unaffiliated third parties on a competitive basis;

 

(xv)         Landlord’s
general corporate overhead and general and administrative expenses;

 

(xvi)        any
compensation paid to clerks, attendants or other persons in commercial
concessions operated by Landlord;

 

(xvii)       services
provided, taxes attributable to, and costs incurred in connection with the
operation of any retail, restaurant and garage operations for the Building, and
any replacement garages and any shuttle services;

 

(xviii)      costs incurred
in connection with upgrading the Building to comply with laws, rules,
regulations and codes with which compliance was first required prior to the
Term Commencement Date;

 

(xix)        all assessments
and premiums which can be paid by Landlord in installments shall be paid by
Landlord in the maximum number of installments permitted by law and not
included as Operating Expenses except in the year in which the assessment or
premium installment is actually incurred;

 

(xx)         costs arising
from the negligence or willful misconduct of Landlord or other tenants or
occupants of the Building or their respective agents, employees, licensees,
vendors, contractors or providers of materials or services;

 

(xxi)        costs arising
from Landlord’s charitable or political contributions;

 

(xxii)       costs to repair
any work required to be performed by Landlord under Exhibit C, during the first
twelve (12) month-period after completion by Landlord of such work;

 

(xxiii)      costs for sculpture,
paintings or other objects of art;

 

(xxiv)      costs
associated with the operation of the business of the entity which constitutes
Landlord as the same are distinguished from the costs of operation of the
Building, including entity (as opposed to property) accounting and legal
matters, costs of defending any lawsuits with any mortgagee (except as the
actions of Tenant may be in issue), costs of selling, syndicating, financing,
mortgaging or hypothecating any of Landlord’s interest in the Building, costs incurred
in connection with any disputes between Landlord and its employees, between
Landlord and Building management, or between Landlord and other tenants or
occupants;

 

8

 

Operating
Expenses shall be determined using the accrual basis of accounting. If at any
time during the Term, less than one hundred percent (100%) of the Rentable Area
of the project is occupied, Operating Expenses that by their nature vary with
occupancy levels shall be adjusted by the Landlord to reasonably approximate
the Operating Expenses which would be incurred if the project had been at least
one hundred percent (100%) occupied.

 

Partial Taking.  Any Taking which is not a Total Taking.

 

Permitted Exceptions.  Any liens or encumbrances on the Premises in
the nature of (a) liens for taxes assessed but not yet due and payable, (b)
easements, reservations, restrictions and rights of way encumbering or
affecting the Land on the date of this Lease, (c) the rights of Landlord,
Tenant and any other Person to whom Landlord has granted such rights to
exercise in common with respect to the Land and the Common Areas the rights
granted to Tenant hereunder, (d) mortgages of record, and (e) Title Conditions.

 

Person.  An individual, a Corporation, a company, a
voluntary association, a partnership, a trust, an unincorporated organization
or a government or any agency, instrumentality or political subdivision
thereof.

 

Predelivery Landlord’s Work.  The
work completed by Landlord prior to the Term Commencement Date, as described in
Section 7.01 and Exhibit C.

 

Premises. The space in the Building
shown on Exhibit B hereto.

 

Proceeds.  With respect to any Taking or occurrence
described in Article 17 hereof, with respect to which any Person is obligated
to pay any amount to or for the account of Landlord, the aggregate of (i) all
sums payable or receivable under or in respect of any insurance policy, and
(ii) all sums or awards payable in respect to a Taking.

 

Rent.  Basic Rent and all Additional Rent.

 

Rentable Area of the Premises.  The number of square feet stated in Section
1.01, whether the same should be more or less as a result of minor variations
resulting from actual construction and completion of the Premises so long as
such work is done in accordance with the terms and provisions hereof.  The calculation was made according to the
following formula:

 

(i)            On single
tenant floors, the usable area measured from the outside surfaces of the outer walls
of the Building, plus Tenant’s Share of interior Common Areas.

 

(ii)           On multi tenant
floors, the usable area measured from the outside surface of the outer walls of
the Building to the midpoint of all demising walls of the space being measured
plus the area of each corridor adjacent to and required as the result of the
layout of the space being measured, measured from the midpoint of the adjacent
demising walls, plus Tenant’s Share of interior Common Areas.

 

9

 

Rules and Regulations.  Reasonable rules and regulations promulgated
by Landlord and uniformly applicable to Persons occupying the Building
regulating the details of the operation and use of the Building.  The initial Rules and Regulations are
attached hereto as Exhibit E.

 

Stated Expiration Date.  The Stated Expiration Date as stated in
Section 1.01.

 

Taking.  The taking or condemnation of title to all or
any part of the Land or the possession or use of the Building or the Premises
by a Person for any public use or purpose or any proceeding or negotiations which
might result in such a taking or any sale or lease in lieu of or in
anticipation of such a taking.

 

Taxes.  All taxes, special or general assessments,
water rents, rates and charges, sewer rents and other impositions and charges
imposed by Governmental Authorities of every kind and nature whatsoever,
extraordinary as well as ordinary, and each and every installment thereof which
shall or may during the term of this Lease be charged, levied, laid, assessed,
imposed, become due and payable or become liens upon or for or with respect to
the Land or any part thereof or the Building or the Premises, appurtenances or
equipment owned by Landlord thereon or therein or any part thereof or on this
Lease under or by virtue of all present or future Legal Requirements or a tax
based on a percentage, fraction or capitalized value of the Rent (whether in
lieu of or in addition to the taxes hereinbefore described).  Taxes shall not include inheritance, estate,
excise, succession, transfer, gift, franchise, income, gross receipt, or profit
taxes except to the extent such are in lieu of or in substitution for Taxes as
now imposed on the Building, the Land, the Premises or this Lease.  If for any year Taxes have been reduced or
abated, or are subsequently reduced or abated, because of vacancies in the
Building, Taxes for such year shall be adjusted by Landlord to reasonably
approximate the amount Taxes would have been had such vacancies not existed.

 

Tenant.  As defined in the preamble hereof.

 

Tenant’s Share.  Tenant’s Share shall be equal to the Rentable
Area of the Premises divided by the Rentable Area of the Building.

 

Term Commencement Date.  The Term Commencement Date stated in Section
1.01.

 

Title Conditions.  All covenants, agreements, restrictions,
easements and declarations of record on the date hereof so far as the same may
be from time to time in force and applicable.

 

Total Taking.  (i) a Taking of: (a) the fee interest in all
or substantially all of the Building or (b) such title to, easement in, over,
under or such rights to occupy and use any part or parts of the Building to the
exclusion of Landlord as shall have the effect, in the good faith judgment of
the Landlord, of rendering the portion of the Building remaining after such
Taking (even if restoration were made) unsuitable for the continued use and
occupancy thereof for the Permitted Uses or (ii) a Taking of all or
substantially all of the Premises or such title to or easement in, on or over
the Premises to the exclusion of Tenant which in the good faith judgment of the
Landlord prohibits access to the Premises or the exercise by Tenant of any
rights under this Lease.

 

10

 

ARTICLE 2

Premises

 

2.01                        Premises.

 

Landlord
hereby leases and lets to Tenant, and Tenant hereby takes and hires from
Landlord, upon and subject to the terms, conditions, covenants and provisions
hereof, the Premises subject to the Permitted Exceptions.  Landlord reserves the right to install within
or without the Premises pipes, ducts, vents, flues, conduits, wires and
appurtenant fixtures which service other parts of the Building; provided that
such work shall be done in such a manner that it does not materially interfere
with Tenant’s use of the Premises.

 

2.02                        Appurtenances.

 

Tenant,
in common with others entitled thereto from time to time, may use the Common
Areas for the purposes for which they were designed.

 

Landlord
reserves the right, from time to time, to grant easements affecting the Land,
to change or alter the boundaries of the Land and to alter, and grant to others
the right to use, the entrances, parking areas and driveways on the Land, all
for purposes of developing and using properties adjacent to the Land, so long
as the same do not materially interfere with Tenant’s use of the Premises or
the Common Areas or reduce the number or convenience of parking spaces
available for Tenant.

 

2.03                        Reservations
By Landlord.

 

Landlord
reserves the right, exercisable at any time and from time to time without the
same constituting an actual or constructive eviction and without incurring any
liability therefor or otherwise affecting Tenant’s obligations under this
Lease, to make changes, alterations, additions, improvements, repairs or
replacements to the Building and the Common Areas as long as such work does not
materially interfere with Tenant’s business, including, without limitation,
elimination of Common Areas and changing the size, arrangement and location of,
and eliminating, entrances, lobbies, driveways, parking areas, doors,
corridors, elevators, stairs and restrooms.

 

ARTICLE 3

Term

 

3.01                        Term
Commencement.

 

The
Lease Term shall commence on the Term Commencement Date.  Tenant shall be granted full access to the
Premises on the Term Commencement Date.

 

3.02                        Termination.

 

The
Lease Term shall end on the Lease Termination Date, subject to extension in
accordance with Section 26.07 and termination in accordance with Section 26.08.

 

11

 

ARTICLE 4

Rent

 

4.01                        Basic
Rent.

 

Tenant
shall pay Landlord for the Premises, without offset or deduction and without
previous demand therefor, the Basic Rent as annual rent for each Lease
Year.  Commencing on the Basic Rent
Commencement Date, Basic Rent shall be paid in equal monthly installments in
advance on the first day of each calendar month during the Lease Term.  Basic Rent for partial months at the
beginning or end of the Lease Term shall be pro rated.

 

4.02                        Computation
of Basic Rent.

 

The
Basic Rent for each Lease Year shall be as stated in Article 1.01 hereof.

 

Basic
Rent shall be exclusive of (and in addition to) amounts due hereunder for Taxes
and Operating Expenses.

 

ARTICLE 5

Use of Premises

 

5.01                        Use
Restricted.

 

The
Premises may be used for the Permitted Uses as stated in Article 1.01 hereof
and for no other purpose.  No
improvements may be made in or to the Premises except as otherwise provided in
this Lease.

 

5.02                        Rules
and Regulations.

 

Tenant
shall comply with Rules and Regulations established from time to time by
Landlord.  Landlord shall not be liable
to Tenant for (a) the failure of other tenants to comply with such Rules and
Regulations, (b) the failure of other tenants to comply with any term or provision
of their respective leases or (c) any nuisance or wrongful, negligent,
improper, offensive or unlawful act or omission of any such other tenant.  Landlord shall not enforce such rules and
regulations other than in a non-discriminatory manner.

 

ARTICLE 6

Taxes; Operating Expenses;

Estimated Cost of Electrical Services

 

6.01                        Expenses
and Taxes.

 

With
respect to each Calendar Year of the Lease Term, Tenant shall pay Tenant’s
Share of Operating Expenses and Taxes. 
Amounts due under this Section 6.01 shall be due as provided in Section
6.03 hereof.

 

12

 

6.02                        Annual
Statement of Additional Rent Due.

 

Landlord
shall render to Tenant a statement, showing (i) for the Calendar Year so
indicated (a) Taxes and (b) Operating Expenses and (ii) for the then current
Calendar Year, an estimate for (a) Operating Expenses, (b) Taxes and (c) Tenant’s
obligation under Section 6.01.

 

6.03                        Monthly
Payments of Additional Rent.

 

Tenant
shall pay to Landlord in advance for each calendar month of the Lease Term
falling between receipt by Tenant of the statement described in Section 6.02
and receipt by Tenant of the next such statement, as Additional Rent, an amount
equal to 1/12th of Tenant’s estimated obligation under Section 6.01 shown
thereon.  The amount due under this
Section 6.03 shall be paid with Tenant’s monthly payments of Basic Rent and
shall be credited by Landlord to Tenant’s obligations under Section 6.01.  If the total amount paid hereunder exceeds
the amount due under Section 6.01, such excess shall be credited to Tenant by
Landlord against the monthly installments of Additional Rent next falling due
or shall be refunded to Tenant upon the expiration or termination of this Lease
; provided, however, that if this Lease is terminated on account of an Event of
Default, then Landlord may apply the excess payment against amounts owed by
Tenant under Section 22.04.  If the total
amount paid is less than the amount due under Section 6.01, Tenant shall pay to
Landlord the balance within thirty (30) days after delivery by Landlord of such
statement.

 

6.04                        Accounting
Periods.

 

Landlord
shall have the right from time to time to change the periods of accounting
hereunder to any other annual period than a Calendar Year, and upon any such
change, all items referred to in this Article 6 shall be appropriately
apportioned.  In all statements rendered
under Section 6.02, amounts for periods partially within and partially without
the accounting periods shall be appropriately apportioned, and any items which
are not determinable at the time of a statement shall be included therein on
the basis of Landlord’s estimate and with respect thereof Landlord shall render
to Tenant promptly after determination a supplemental statement and an appropriate
adjustment shall be made according thereto.

 

6.05                        Abatement
of Taxes.

 

Landlord
may at any time and from time to time make application to the appropriate
Governmental Authority for an abatement of Taxes.  If (i) such an application is successful and
(ii) Tenant has made any payment in respect of Taxes pursuant to this Article 6
for the period with respect to which the abatement was granted, Landlord shall
(a) deduct from the amount of the abatement all reasonable expenses incurred by
it in connection with the application, (b) recompute Tenant’s obligation with
respect to Taxes under Section 6.01 and refund any overpayment to Tenant and
(c) retain the balance, if any.

 

If
at least twenty (20) days prior to the last day for filing an application for
abatement of Taxes for any tax year, Tenant shall give notice to Landlord that
it desires to file an application for abatement of such Taxes or to otherwise
contest the assessed valuation of the Premises for such tax year, and if within
five (5) days after the receipt of such notice Landlord does not give notice
back to Tenant that

 

13

 

Landlord
shall itself file such application or commence such contest, then Tenant shall
have the right either in its own name or in the name of Landlord but at its own
cost and expense to file such application or commence such contest.  If within five (5) days after receipt by
Landlord of such notice from Tenant, Landlord shall give Tenant notice that
Landlord shall itself file such application or commence such contest, then
Landlord shall do so prior to the expiration of the time for the filing of the
same at its own cost and expense.  If
Landlord shall not give such notice, then Tenant shall file the same or
commence such contest prior to the expiration of the time for filing or
commencing the same at its own cost and expense.  In any event, if any abatement by whomever
prosecuted shall be obtained, the cost and expense of obtaining the same shall
be the first charge upon such abatement and shall be reimbursed to the party
expending the same from the proceeds thereof, prior to any other
distribution.  If Tenant shall file an
application for abatement or commence such contest pursuant to the provisions
of this paragraph, Tenant shall prosecute the same to final determination with
reasonable diligence and shall not, without Landlord’s consent (which shall not
be unreasonably withheld), settle, compromise or discontinue the same except
that Tenant may discontinue the prosecution of the same at any time after
giving Landlord notice thereof and a reasonable opportunity to assume
prosecution of the same.  If Landlord
shall file an application for abatement or commence such contest, Landlord
shall prosecute the same to final determination with reasonable diligence and
shall not without Tenant’s consent (which shall not be unreasonably withheld),
settle, compromise, or discontinue the same except that Landlord may
discontinue the prosecution of the same at any time after giving Tenant notice
thereof and a reasonable opportunity to assume prosecution of the same.  If either party shall file an application for
an abatement or commence such contest, the other will cooperate and furnish any
pertinent information in its files reasonably required by the prosecuting
party.  In every case, any abatement,
refund, rebate or credit received shall be paid first to the party which
prosecuted such abatement in the amount of the costs and expenses expended by
it in such connection, and the balance to each party in the proportion that it
paid the tax or assessment being abated, refunded, rebated or credited.  Landlord shall pay any sums due to Tenant
from any abatement after receipt of the same even if this Lease shall have expired.  Tenant shall timely pay all sums payable
under this Lease in respect of taxes and assessments notwithstanding the
pendency of an abatement proceeding or any such contest, unless and to the
extent legally permitted to do otherwise.

 

6.06                        Electric
and Gas Service.

 

Commencing
on the Term Commencement Date and for the entirety of the Lease Term, Tenant
shall arrange to obtain electricity and gas for the Premises at Tenant’s
expense from such source or sources as Landlord shall designate as the source
or sources therefor for the Building from time to time.  Tenant shall pay or cause to be paid when due
all charges for gas and electricity used in or upon the Premises during the
term of this Lease which shall be separately metered for such utilities consumed
in or from the Premises. Subject only to Landlord’s obligations under Exhibit
C, Landlord shall have no obligation with respect to electricity and gas for
the Premises.

 

6.07                        Late
Payment of Rent and Late Charges.

 

Tenant’s
failure to pay Rent, Additional Rent, or any other payments due under this
Lease when due under this Lease may cause Landlord to incur unanticipated
costs.  The exact amount of such costs
are impractical or extremely difficult to ascertain.  Such costs may include, but are not limited
to,

 

14

 

processing
and accounting charges and late charges that may be imposed on Landlord by any
ground lease, mortgage, or deed of trust encumbering the Land or Building.

 

Therefore,
if Landlord does not receive the Rent, Additional Rent, or any other payments
due under this Lease in full within five (5) days after the due date, Tenant
shall pay Landlord a late charge, which shall constitute liquidated damages,
equal to five percent (5%) of each unpaid portion (“Late Charge”), which shall
be paid to Landlord together with such Rent, Additional Rent, or other Lease
costs then in arrears.  Notwithstanding
anything to the contrary contained herein, so long as Tenant has not been in
default in the payment of Rent, Additional Rent and other Lease costs more than
once in any twelve (12) consecutive month period, no such Late Charge shall
accrue.

 

The
parties agree that such Late Charge represents a fair and reasonable estimate
of the cost Landlord will incur by reason of such late payment.

 

For
each Tenant payment check to Landlord that is returned by a bank for any
reason, Tenant shall pay both a Late Charge (if applicable) and a returned
check charge (“Returned Check Charge”) of an amount equal to that charged by
Landlord’s bank at the time.

 

All
Late Charges and any Returned Check Charge shall then become Additional Rent
and shall be due and payable immediately along with such other Rent, Additional
Rent, or other Lease costs then in arrears.

 

Money
paid by Tenant to Landlord shall be applied to Tenant’s account in the
following order:  (i) to any unpaid
Additional Rent, including, without limitation, Late Charges, Returned Check
Charges, legal fees and/or court costs legally chargeable to Tenant, Operating
Expenses and Taxes; and then (ii) to unpaid Basic Rent.

 

Nothing
herein contained shall be construed so as to compel Landlord to accept any
payment of Rent, Additional Rent, or other Lease costs in arrears or Late
Charge or Returned Check Charge should Landlord elect to apply its rights and
remedies available under this Lease or at law or in equity in the case of an
Event of Default hereunder by Tenant. 
Landlord’s acceptance of Rent, Additional Rent, or other Lease costs in
arrears or Late Charge or Returned Check Charge pursuant to this clause shall
not constitute a waiver of Landlord’s rights and remedies available under this
Lease at law or in equity.

 

6.08                        Tenant
Audit Right.

 

Tenant
shall have the right, on reasonable notice to Landlord and at reasonable times,
to inspect and review Landlord’s books and records with respect to Operating
Expenses, provided that Tenant shall conduct such inspection and review for any
year no later than six (6) months after delivery of the statement of Operating
Expenses for such year and provided that Tenant shall timely pay all sums due
with respect to Operating Expenses notwithstanding that it shall elect to
perform such an inspection and review. 
Such payment may be made without prejudice to Tenant’s rights under this
paragraph.  If it shall be determined
that Tenant shall have overpaid any sums on account of Operating Expenses,
Landlord shall promptly refund the same. 
If the audit discloses any overpayment on the part of Tenant, then
Tenant shall be entitled to a credit on the next succeeding installment of rent
for an amount equal to the overcharge plus interest on the amount of such
overcharge from the date on which

 

15

 

Tenant
received the statement of Operating Expenses until the date Tenant completes
the audit at a rate of 18% per annum, and such credit shall be extended to
succeeding installments of rent in the event such overcharge exceeds the amount
of the next succeeding such installment and, in the event the term of this
Lease has expired or been earlier terminated, then Tenant shall be entitled to
a refund of such excess from Landlord within thirty (30) days after completion
of the audit.  In addition, in the event
such audit by Tenant discloses such an overcharge in excess of the ten percent
(10%) of the amount payable in accordance with Article 6 of this Lease, then
Landlord shall pay to Tenant the reasonable costs and expenses of such audit,
such costs not to exceed thirty-three percent (33%) of the total amount of the
overcharge.

 

ARTICLE 7

Improvements, Repairs, Additions, Replacements

 

7.01                        Preparation
of the Premises.

 

The
Term Commencement Date shall be the date of this Lease.  Tenant shall accept the Premises in its “as
is” condition, and Landlord shall have no obligation to perform any work or
construction to prepare the Premises for Tenant, except that Landlord shall
deliver the Premises to Tenant (i) broom clean, (ii) free of all occupants, and
(iii) in the condition required under this Lease. Landlord has completed the
Predelivery Landlord’s Work described on Exhibit C.

 

7.02                        Alterations
and Improvements.

 

Tenant
may make (a) cosmetic alterations or improvements (i.e., painting, carpeting,
flooring, etc) regardless of cost; (b) any other non-structural alterations,
additions or improvements having a cost, when aggregated with all work
performed at substantially the same time, of $100,000.00 or less, without
Landlord’s prior consent and Tenant may make non-structural alterations,
additions or improvements having a cost, when aggregated with all work performed
at substantially the same time, in excess of $100,000.00, with Landlord’s prior
written consent, which consent shall not be unreasonably withheld or delayed,
and then only in accordance with plans and specifications therefor first
approved by Landlord (the “Tenant Improvements Plans”), such approval not to be
unreasonably withheld.

 

Landlord
shall review Tenant’s proposed Tenant Improvements Plans and shall notify
Tenant in writing within fifteen (15) business days after Landlord’s receipt of
same as to whether Landlord approves the Tenant Improvements Plans (which
approval shall not be unreasonably withheld, conditioned or delayed).  If Landlord fails to respond to Tenant’s
request for review and approval of Tenant’s proposed Tenant Improvements Plans
within fifteen (15) business days after receipt of Tenant’s request, Tenant
must send a second notice to Landlord, which such second notice must state that
it is the second notice to Landlord in connection with Tenant’s request for
approval of the Tenant Improvement Plans and that Landlord’s failure to respond
to such second notice within five (5) days after receipt thereof shall be
deemed Landlord’s approval of the Tenant Improvement Plans.  If Landlord fails to respond to Tenant’s
second notice within such five (5) day period, the Tenant Improvement Plans
shall be deemed approved by Landlord.

 

16

 

If
Landlord does not approve the Tenant Improvements Plans, such written notice
from Landlord to Tenant shall provide Landlord’s specific and detailed comments
and suggestions which, if incorporated into the Tenant Improvements Plans,
would render the Tenant Improvements Plans acceptable to Landlord.  Landlord and Tenant shall cooperate with one
another in good faith to reach agreement regarding the Tenant Improvements
Plans as soon as practicable.  In the
event Landlord and Tenant are unable, after complying with the foregoing terms
and provisions in this Section 7.02, to reach agreement regarding the Tenant
Improvements Plans within ten (10) business days after the date on which
Landlord delivers to Tenant Landlord’s specific and detailed comments and
suggestions relating to the Tenant Improvements Plans pursuant to this Section
7.02, then until such time as Landlord and Tenant succeed in reaching agreement
relative to the Tenant Improvements Plans, either Landlord or Tenant shall be
entitled to submit the issue(s) in dispute to expedited arbitration in
accordance with the terms and provisions of Section 26.21 of the Lease.  Landlord hereby approves the plans shown on
Exhibit K, attached hereto, and agrees that it will approve the Tenant
Improvement Plans as long as such plans are consistent with the attached plans.  Without limitation, Landlord may withhold
approval of any alterations or additions which would (a) require unusual
expense to readapt the Premises to normal office, research and development,
warehousing, and distribution uses upon termination of this Lease or (b)
increase the cost of insurance; provided, however, that Landlord shall not be
entitled to withhold Landlord’s approval of such alterations or additions for
the reasons described in clauses (a) or (b) if Tenant agrees to reimburse
Landlord for such unusual expenses or the amount of the increase in the cost of
insurance, if any, associated with Tenant’s alterations or additions.

 

Notwithstanding
anything to the contrary contained herein, Landlord acknowledges that Tenant,
at Tenant’s sole cost, shall have the option to install its own security system
in the Building.

 

All
of Tenant’s alterations and additions and installation of furnishings shall be
coordinated with any work being performed by Landlord and in such manner as to
maintain harmonious labor relations and not to damage the Building or the
Premises or interfere with Building operation and, except for installation of
furnishings, shall be performed by general contractors and subcontractors first
approved by Landlord, such approval not to be unreasonably withheld.  Landlord hereby approves as a general
contractor Builders Systems Inc., 135 Southbridge Street, Box 635, Auburn, MA
01501 (508-798-8797.  Except for work
done by or through Landlord, Tenant before its work is started shall: secure
all licenses and permits necessary therefor; deliver to Landlord a statement of
the names of all its contractors and subcontractors and the estimated cost of
all labor and material to be furnished by them; and cause each contractor to
carry workers’ compensation insurance in statutory amounts covering all the
contractor’s and subcontractor’s employees and commercial general liability
insurance with such limits as Landlord may reasonably require, but in no event
less than $1,000,000.00 and property damage insurance with limits of not less
than $1,000,000.00 and have deductibles of no more than $5,000.00 (all such
insurance to be written by companies approved by Landlord and insuring Tenant
and Landlord and its managing agent and its mortgagees, as well as the
contractors), and to deliver to Landlord certificates of all such
insurance.  Tenant agrees to pay promptly
when due the entire cost of any work done in the Premises by Tenant, its
agents, employees or independent contractors, and not to cause or permit any
liens therewith to attach to the Premises and immediately to discharge any such
liens which may so attach.  All
construction work done by Tenant, its agents,

 

17

 

employees
or independent contractors shall be done in a good and workmanlike manner and
in compliance with all Legal Requirements and Insurance Requirements.

 

Promptly
after completion of any work, whether or not Landlord’s consent was required,
Tenant shall furnish as built plans therefor to Landlord.

 

At
or prior to expiration of the Term, Tenant shall remove (a) all alterations and
improvements designated for removal by Landlord at the time it approves the
same and (b) all alterations and improvements not approved by Landlord
(including alterations and improvements for which Landlord’s approval was not
required) or to which Landlord has objected but have been permitted under
Section 26.21 which Landlord shall designate for removal by notice prior to
expiration of the Term.  Removal shall
include restoration of all affected areas to the condition prior to such
alterations and improvements.

 

7.03                        Maintenance
By Tenant.

 

Except
for Landlord’s obligations under Section 8.01, Tenant shall, at all times
during the Lease Term, and at its own cost and expense, (a) keep and maintain
the Premises in good repair and condition (reasonable wear and tear and damage
by fire or casualty only excepted) and (b) use all reasonable precautions to
prevent waste, damage or injury thereto.

 

7.04                        Redelivery.

 

On
the Lease Termination Date, without limiting its other obligations under this
Lease, Tenant shall surrender all keys to the Premises, remove all of its trade
fixtures, equipment and personal property in the Premises and all of Tenant’s
signs and quit and surrender the Premises free and clear of all tenants and
occupants and liens and encumbrances arising through Tenant.  Tenant shall, subject to the provisions of
Articles 17 and 18 hereof, surrender the Premises to Landlord broom clean and
in good condition and repair (reasonable wear and tear and damage by fire or casualty
only excepted) with all damage occasioned by Tenant’s removal of Tenant’s trade
fixtures, equipment or equipment repaired at Tenant’s cost to Landlord’s
reasonable satisfaction.  Any property
not so removed shall be deemed abandoned and may be removed and disposed of by
Landlord in such manner as it shall determine. 
Tenant shall pay Landlord the entire cost and expense incurred by it in
effecting such removal and disposition and in making any incidental repairs and
replacements.

 

ARTICLE 8

Landlord’s Obligations

 

8.01                        Maintenance
By Landlord.

 

Subject
to Sections 17 and 18, Landlord shall maintain the exterior walls (exclusive of
the glass and doors and exclusive of the interior surface of the exterior
walls, all of which Tenant shall maintain and repair), roof, foundation, and
structural supports of the Building. 
Landlord shall also maintain the Common Areas, plumbing, electrical and
mechanical systems (exclusive of the chiller referred to in Exhibit C and inclusive
of the HVAC Equipment unless Tenant elects to maintain such HVAC Equipment
itself and notifies Landlord of the same).

 

18

 

8.02                        Limitations
on Landlord’s Liability.

 

Landlord
shall not be liable in damages, and shall not be in default hereunder, for any
failure or delay in complying with any of its obligations hereunder when such
failure or delay is occasioned by Force Majeure or by the act or Default of
Tenant.  No such failure or delay shall
be held or pleaded as eviction or disturbance in any manner whatsoever of
Tenant’s possession or give Tenant any right to terminate this Lease or give
rise to any claim for set off or any abatement or Rent or of any of Tenant’s
obligations under this Lease except as set forth in Section 8.03.

 

8.03                        Tenant’s
Right to Self Help.

 

If
Landlord shall default in the performance of any of its obligations under this
Lease, and if Landlord shall not cure such default within a thirty (30) day
period after notice from Tenant specifying the default (or, if such default
cannot by its nature be cured within such thirty (30) day period and Landlord
shall not within such period commence to cure such default and thereafter
prosecute the curing of such default to completion with due diligence), Tenant
may, at its option (but shall not be obligated to), at any time after ten (10)
days after giving to Landlord a further notice of default specifically referring
to this Section 8.03, cure such default for the account of Landlord; provided,
however, that in cases of emergencies that pose an immediate material threat to
person, property, or Tenant’s business operation, Tenant may, at its option
(but shall not be obligated to), cure such default for the account of Landlord
immediately after giving Landlord telephone, facsimile, or electronic notice of
Tenant’s intent to exercise of its right to self-help hereunder.  Any reasonable amount paid or any reasonable
contractual liability incurred by Tenant in exercising its right to self-help
hereunder shall be deemed paid or incurred for the account of Landlord, and, if
Landlord shall not reimburse Tenant within thirty (30) days after demand for
any amount paid for the account of Landlord hereunder, Tenant shall have the
right to deduct any amount (with interest on such amount at ten percent (10%)
per annum) still owing from future payments of Basic Rent hereunder but such
deduction shall not exceed fifteen percent (15%) of the Basic Rent payable for
any month (or such higher amount as shall be required for Tenant to recoup such
amount ratably over the remainder of the Lease Term).

 

ARTICLE 9

Tenant’s Particular Covenants

 

9.01                        Pay
Rent.

 

Tenant
shall pay when due all Rent and Additional Rent, including, without limitation,
all charges for utility services rendered to the Premises.

 

9.02                        Occupancy
of the Premises.

 

Tenant
shall occupy the Premises continuously from the Term Commencement Date for the
Permitted Uses only.  Tenant shall not
(i) injure or deface the Premises or the Building, (ii) install any exterior
sign except as set forth in Section 26.06, (iii) permit in the Premises any
flammable fluids or chemicals not reasonably related to the Permitted Uses, or
(iv) permit any nuisance or any use thereof

 

19

 

which
is improper, offensive, contrary to any Legal Requirement or Insurance
Requirement or liable to render necessary any alteration or addition to the
Building.

 

Tenant
shall not permit any noise, vibration or odor to emit from the Premises which
in Landlord’s sole discretion is offensive or inappropriate for a building
comparable to the Building.

 

9.03                        Safety.

 

Tenant
shall keep the Premises equipped with all safety appliances required by Legal
Requirements or Insurance Requirements because of any use made by Tenant.  Tenant shall procure all Authorizations so
required because of such use and, if requested by Landlord, shall do any work
so required because of such use, it being understood that the foregoing
provision shall not be construed to broaden in any way the Permitted Uses.  Notwithstanding anything to the contrary
contained in this Lease, however, Tenant shall not be responsible for
compliance with any such laws, regulations, or the like requiring (a)
structural repairs or modifications; or (b) repairs or modifications to the
utility or building service equipment; or (c) installation of new building
service equipment, such as fire detection or suppression equipment, unless such
repairs, modifications, or installations shall arise from (i) Tenant’s
particular use of the Premises, or (ii) 
the negligence or default of Tenant or any agent, employee, or
contractor of Tenant, or (iii) any work performed by Tenant.

 

9.04                        Equipment.

 

Tenant
shall not place a load upon the floor of the Premises exceeding the live load
for which the floor has been designed and shall not move any safe or other
heavy equipment in, about or out of the Premises except in such a manner and at
such a time as Landlord shall in each instance authorize.

 

9.05                        Electrical
Requirements

 

Tenant’s
use of electrical energy in the Premises shall not exceed the capacity of the
Premises electrical systems.

 

9.06                        Pay
Taxes.

 

Tenant
shall pay promptly when due all Taxes upon personal property (including,
without limitation, fixtures and equipment) in the Premises to whomsoever
assessed.

 

ARTICLE 10

Requirements of Public Authority

 

10.01                 Legal
Requirements.

 

Tenant
shall, at its own cost and expense, promptly observe and comply with all Legal
Requirements.  Notwithstanding anything
to the contrary contained in this Lease, however, Tenant shall not be
responsible for compliance with any such laws, regulations, or the like requiring
(a) structural repairs or modifications; or (b) repairs or modifications to the
utility or building service equipment; or (c) installation of new building
service equipment, such as fire detection or suppression

 

20

 

equipment,
unless such repairs, modifications, or installations shall arise from (i)
Tenant’s particular use of the Premises, or (ii)  the negligence or default of Tenant or any
agent, employee, or contractor of Tenant, or (iii) any work performed by
Tenant.  Tenant shall pay all costs,
expenses, liabilities, losses, damages, fines, penalties, claims and demands,
that may in any manner arise out of or be imposed because of the failure of
Tenant to comply with the covenants of this Article 10. The Landlord shall not
be responsible or liable for any loss or interruption of Tenant’s business, or
any costs of compliance, caused by the enforcement of any Legal Requirements
which are related to Tenant’s use of the Premises or the Common Areas.

 

Tenant
shall not dump, flush, or in any way introduce any Hazardous Substances or any
other toxic substances into the septic, sewage or other waste disposal system
or generate, store or dispose of Hazardous Substances in or on the Premises or
the Land, or dispose of Hazardous Substances from the Premises or the Land to
any other location without the prior consent of Landlord, which consent shall
not be unreasonably withheld, and then only in compliance with the Resource
Conservation and Recovery Act of 1976, as amended, 42 U.S.C.§6901 et seq., the
Massachusetts Hazardous Waste Management Act, M.G.L. c.21C., as amended, the
Massachusetts Oil and Hazardous Material Release Prevention and Response Act,
M.G.L. c.21E, as amended, and all other applicable codes, regulations,
ordinances and laws.  Tenant shall notify
Landlord of any incident which would require the filing of a notice under
M.G.L. c.21E and shall comply with the orders and regulations of all
governmental authorities with respect to zoning, building, fire, health and
other codes, regulations, ordinances or laws applicable to the Premises or the
Land.  “Hazardous Substances” as used in
this Section shall mean “hazardous substances” as defined in the Comprehensive
Environmental Response Compensation and Liability Act of 1980, as amended, 42
U.S.C. §9601 and regulations adopted pursuant to such Act.

 

Landlord may, if it so
elects, make any of the repairs, alterations, additions or replacements which
otherwise would be Tenant’s responsibility under this Section which affect the
Building structure or the Building systems, and Tenant shall reimburse Landlord
for the cost thereof within twenty (20) days of Landlord’s invoice therefor.

 

Tenant
will provide Landlord, from time to time upon Landlord’s request, with all
non-proprietary records and information regarding any Hazardous Substance
maintained on the Premises by Tenant, but in any event shall provide a list
identifying all Hazardous Substances maintained on the Premises by Tenant.

 

Landlord
shall have the right to make such inspections as Landlord shall reasonably
elect from time to time to determine if Tenant is complying with this Section
or with Tenant’s obligations elsewhere under this Lease, which inspections
shall be at Tenant’s expense if any such inspection shall show that Tenant has
not complied with its obligations herein.

 

10.02                 Contests.

 

Tenant
shall have the right to contest by appropriate legal proceedings diligently
conducted in good faith, in the name of Tenant or Landlord (if legally
required), or both (if legally required), without cost, expense, liability or
damage to Landlord, the validity or application of any Legal

 

21

 

Requirement,
and, if compliance with any of the terms of any such Legal Requirement may
legally be delayed pending the prosecution of any such proceeding, Tenant may
delay such compliance therewith until the final determination of such
proceeding.

 

ARTICLE 11

Covenant Against Liens

 

11.01                 Mechanics’
Liens.

 

Landlord’s
right, title and interest in the Premises shall not be subject to or liable for
liens of mechanics or materialmen for work done on behalf of Tenant in
connection with improvements to the Premises. 
Notwithstanding such restriction, if because of any act or omission of
Tenant, any mechanics’ lien or other lien, charge or order for payment of money
shall be filed against any portion of the Premises, Tenant shall, at its own
cost and expense, cause the same to be discharged of record within fifteen (15)
days after the filing thereof.

 

11.02                 Right
to Discharge.

 

Without
otherwise limiting any other remedy of Landlord for default hereunder, if
Tenant shall fail to cause such liens to be discharged of record within the
aforesaid fifteen (15) day period, then Landlord shall have the right to cause
the same to be discharged.  All amounts
paid by Landlord to cause such liens to be discharged shall constitute
Additional Rent.

 

ARTICLE 12

Access to Premises

 

12.01                 Access.

 

Landlord
covenants and agrees, except in emergency situations, that Tenant shall have
access to and the right to use the Premises at all times, twenty-four (24)
hours per day and three hundred sixty-five (365) days per year during the
Term.  Landlord and Landlord’s agents and
designees shall have the right, but not the obligation, to enter upon the
Premises during ordinary business hours upon twenty-four hours prior notice to
Tenant from Landlord, to perform its obligations hereunder, to examine same and
to exhibit the Premises to prospective purchasers, mortgagees,  tenants or other persons or agents as
Landlord shall designate from time to time, except that no prior notice shall
be required in an emergency.  Tenant or
Tenant’s representatives shall have the right to accompany Landlord at all
times during the periods Landlord accesses the Premises pursuant to this
Section.  Landlord shall keep
confidential any confidential or proprietary information of which Landlord
becomes aware during any such period of access.

 

22

 

ARTICLE 13

Assignment and Subletting: Occupancy Arrangements

 

13.01                 Subletting
and Assignment.

 

Tenant
shall not enter into any Occupancy Arrangement, either voluntarily or by
operation of law without the prior consent of Landlord, which consent will not
be unreasonably withheld.  Without
limiting the generality of the foregoing, in no event shall Tenant enter into
negotiations to sublet all or any part of the Premises or to assign this Lease,
offer to so sublet or assign or so sublet or assign to any tenant or occupant
of the Building or to any party with whom Landlord is then negotiating with
respect to space in the Building.

 

If
Tenant intends to enter into an Occupancy Arrangement, Tenant shall so notify
Landlord in writing, stating the name of (and providing a financial statement
with respect to) the Person with whom Tenant intends to enter into such
Arrangement, the material terms of the Occupancy Arrangement and a precise
description of the portion of the Premises intended to be subject thereto.  Within twenty-one (21) days of receipt of
such writing, Landlord shall either (i) consent to such Occupancy Arrangement,
such consent not to be unreasonably withheld, or (ii) deny consent to such
Occupancy Arrangement.  Landlord’s
failure to respond within such twenty-one (21) day period shall be deemed
consent to the Occupancy Arrangement.  If
Tenant proposes to assign this Lease or sublet more than fifty percent (50%) of
the Premises for substantially the remainder of the Term, other than in a
transaction under which Landlord’s consent is not required, Landlord may elect
to terminate this Lease in the case of an assignment or, in case of a sublease,
terminate this Lease with respect to the portion of the Premises intended to be
subject thereto, such election to be made by notice within such twenty-one (21)
day period, such termination to be effective as of the date such assignment or
sublease would have commenced.  If
Landlord so terminates this Lease in whole or in part, all Rent shall be
adjusted as of the day the Premises (or portion thereof) are redelivered to
Landlord.  Any portion of the Premises so
redelivered shall be in its then as-is condition.  If Landlord elects to terminate this Lease in
whole or in part pursuant to the foregoing, Landlord shall be responsible, at
its sole cost and expense, for constructing and installing any demising walls
necessary to demise the recaptured portion of the Premises from the portion of
the Premises retained by Tenant.

 

If
the Landlord consents to an Occupancy Arrangement, Tenant shall (i) enter into
such Occupancy Arrangement on the terms described to Landlord within thirty
(30) days of Landlord’s consent or comply again with the terms of this Section
and (ii) remain liable for the payment and performance of the terms and
covenants of this Lease.  If Tenant
enters into such an Occupancy Arrangement, Tenant shall pay to Landlord when
received fifty percent (50%) of the excess, if any, of amounts received in
respect of such Occupancy Arrangement over the Rent.  For the purpose of the preceding sentence, amounts
received by Tenant in respect of such Occupancy Arrangement shall be deemed to
include (a) any costs assumed or paid by the subtenant or assignee thereunder
(such as brokerage commissions, tenant improvements and other expenses) which
are normally are paid by landlords or sub-landlords in comparable transactions
and (b) any sums paid for the sale, rental or use of any of Tenant’s personal
property (in case of a sale only, reduced by Tenant’s depreciated basis thereof
for federal income tax purposes).  In
calculating any excess rent payable by Tenant to Landlord pursuant to this
provision, Tenant shall first be entitled to deduct brokerage commissions
and/or legal

 

23

 

fees
paid by Tenant in connection with the assignment or sublease and any costs
incurred by Tenant to prepare the Premises of occupancy by such subtenant or
assignee.

 

Landlord’s
consent shall not be required with respect to (i) any transfers of direct or
indirect ownership interests in Tenant or its Affiliates in the public markets,
(ii) any assignment or subletting to a parent, subsidiary or other Affiliate,
(iii) any assignment or subletting in connection with a sale of substantially
all the assets of Tenant or a merger, consolidation, reorganization or other
corporate transaction provided that in the case of transactions described in
clause (iii), the successor entity has at least the same tangible net worth as
Tenant immediately prior to such transaction, provided, however, that if the successor
to Tenant does not have a tangible net worth computed in accordance with
generally accepted accounting principles at least equal to the lesser of Tenant’s
tangible net worth as of the date hereof or immediately prior to such
transaction, Tenant shall either (a) obtain Landlord’s prior written consent to
such transaction, as provided above, or (b) increase the Security Deposit under
Section 24.01 by an amount equal to the sum of three (3) months’ Basic Rent
then in effect under the Term  (iv) any collateral
assignment as security in connection with a financing transaction, or (v) any
assignment or subletting to a joint venture party or other party with whom
Tenant or any of its Affiliates have a contractual or other business
relationship.  Landlord’s consent shall
be required for any other assignment or subletting but shall not be
unreasonably withheld, conditioned or delayed. 
Moreover, Landlord’s consent shall be deemed granted to the extent
Landlord fails to respond to any request for consent, sent in accordance with
Section 25.02, within thirty (30) business days following delivery of the
request and applicable information relating to the assignment or subletting.

 

ARTICLE 14

Indemnity

 

14.01                 Tenant’s
Indemnity.

 

To
the fullest extent permitted by law, Tenant shall indemnify and save harmless
Landlord from and against any and all liability, damage, penalties or judgments
and from and against any claims, actions, proceedings and expenses and costs in
connection therewith, including reasonable counsel fees, arising from (a) an
Event of Default, (b) injury to person or property sustained by anyone in and
about the Premises, or (c) from injury to person or property occurring outside
the Premises but within the Building or on the Land, to the extent such injury
results, or is claimed to have resulted, from any negligent act or omission, or
negligence on the part of Tenant, or Tenant’s contractors, licensees, agents,
servants, employees, or customers, or anyone claiming by or through Tenant,
except to the extent that such claims, actions, proceedings and expenses and
costs are caused solely by the negligent acts or omissions of Landlord.  Tenant shall, at its own cost and expense,
defend any and all suits or actions (just or unjust) in which Landlord may be
impleaded with others upon any such above mentioned matter, claim or claims,
except as may result from the acts as set forth in Section 14.02.  All merchandise, furniture, fixtures and
property of every kind, nature and description of Tenant or Tenant’s employees,
agents, contractors, invitees, visitors, or guests which may be in or upon the
Premises or the Building during the Lease Term shall be at the sole risk and
hazard of Tenant, and if the whole or any part thereof shall be damaged,
destroyed, stolen or removed by reason of any cause or reason whatsoever, other
than the negligence or willful misconduct of Landlord, no part of said damage
or loss shall be charged to or borne by Landlord.

 

24

 

14.02                 Landlord’s
Liability.

 

To
the fullest extent permitted by law, Landlord shall indemnify and save harmless
Tenant from and against any and all liability, damage, penalties or judgments
and from and against any claims, actions, proceedings and expenses and costs in
connection therewith, including reasonable counsel fees, arising from (a) a
default by Landlord which has not been cured within the applicable grace period
or (b) injury to person or property sustained by anyone in and about the
Building, or the Premises, or the Land to the extent such injury results, or is
claimed to have resulted, from any negligent act or omission, or negligence on
the part of Landlord, or Landlord’s contractors,  agents, or employees, except to the extent
that such claims, actions, proceedings and expenses and costs are caused solely
by the negligent acts or omissions of Tenant. 
Landlord shall, at its own cost and expense, defend any and all suits or
actions (just or unjust) in which Tenant may be impleaded with others upon any
such above mentioned matter, claim or claims, except as may result from the
acts as set forth in Section 14.01.

 

ARTICLE 15

Insurance

 

15.01                 Liability
Insurance.

 

Tenant,
at its expense, shall maintain in force during the Lease Term commercial
general liability insurance in a good and solvent insurance company or
companies licensed to do business in the Commonwealth of Massachusetts selected
by Tenant and reasonably satisfactory to Landlord in an amount reasonably
required by Landlord from time to time but in any event not less than Five
Million Dollars ($5,000,000.00) per occurrence with respect to bodily injury or
property damage and Five Million Dollars ($5,000,000.00)  in the aggregate (which such insurance limits
may be satisfied through a combination of primary and umbrella coverage).  Such policy or policies shall include
Landlord and Landlord’s managing agent and mortgagees as additional insureds.

 

Tenant
shall also maintain in force during the Lease Term worker’s compensation
insurance with statutory limits covering all of Tenant’s employees working at
the Premises.

 

15.02                 Casualty
Insurance.

 

Unless
Landlord shall elect to insure the same, Tenant shall cause all alterations and
improvements to the Premises made by Tenant (“Tenant Improvements”) after the
Basic Rent Commencement Date to be insured for the benefit of Landlord and
Tenant, as their respective interests may appear, against loss or damage under
all risk coverage satisfactory to Landlord in an amount equal to the
replacement value thereof.

 

15.03                 Certificates.

 

Tenant
shall deliver certificates of the insurance required under Sections 15.01 and
15.02 to Landlord as of the date hereof and thereafter promptly upon renewal of
any such policy.  Any policy of insurance
required hereunder shall not be cancelable without thirty (30) days’ written
notice to Landlord.

 

25

 

15.04                 Landlord
Insurance.

 

Landlord
shall maintain in full force from the date upon which Tenant first enters the
Premises for any reason, throughout the Term, a policy of insurance upon the
Building (inclusive of Tenant Improvements installed prior to the Basic Rent
Commencement Date, but exclusive of Tenant Improvements installed
thereafter)  insuring against all risks
of physical loss or damage under an All Risk coverage endorsement in an amount
at least equal to the full replacement value of the property insured, with an
Agreed Amount endorsement to satisfy co-insurance requirements, as well as
insurance against breakdown of boilers and other Building machinery as
customarily insured against.  Landlord
shall supply to Tenant from time to time upon request of Tenant certificates of
all such insurance issued by or on behalf of the insurers named therein by a
duly authorized agent.  All policies of
insurance maintained by Landlord shall contain the same waiver of subrogation
provisions for the benefit of Tenant as Tenant is required to obtain in its
insurance policies for the benefit of Landlord.

 

ARTICLE 16

Waiver of Subrogation

 

16.01                 Waiver
of Subrogation.

 

All
property insurance policies carried by either party covering the Premises,
including but not limited to contents, shall expressly waive any right on the
part of the insurer to make any claim against the other party.  The parties hereto agree that their policies
will include such waiver clause or endorsement.

 

16.02                 Waiver
of Rights.

 

Each
of Landlord and Tenant, on behalf of itself and its insurers, hereby waives all
claims, causes of action and rights of recovery against the other and the other’s
respective partners, agents, officers and employees, for any damage to or
destruction of property or business which shall occur on or about the Building
or Land and shall result from any of the perils insured under any and all
policies of insurance maintained, or required to be maintained, by the waiving
party, regardless of cause, including the negligence and intentional wrongdoing
of either party and their respective agents, officers and employees but only to
the extent of recovery (or the estimated extent of recovery had the required
insurance been maintained), if any, under such policy or policies of insurance;
provided however, that this waiver shall be ineffective in the event any such
insurer would be relieved from the obligation to make payment pursuant to a
policy of insurance by reason of this waiver.

 

ARTICLE 17

Damage or Destruction

 

17.01                 Damage
by Fire, Casualty, Eminent Domain.

 

In
case of damage to the Premises by fire or casualty or action of public
authority in consequence thereof, Landlord shall restore the Premises
(inclusive of Tenant Improvements installed prior to the Basic Rent
Commencement Date) to the same condition it was in prior to the damage,
including any alterations or improvements made by parties other than Landlord (but
subject to the last

 

26

 

sentence
of this paragraph hereof), provided, however, that in no event shall Landlord
be required to expend in the repair of the Premises and any other portions of
the Building sustaining such damage more than the proceeds of such insurance
made available to it by its mortgagee. 
The work shall be commenced within thirty (30) days after receipt of the
insurance proceeds and completed with due diligence except for delays due to
governmental regulation, unusual scarcity of or inability to obtain labor or
materials, or causes beyond Landlord’s reasonable control, and Landlord shall
be entitled to receive and retain the proceeds of all insurance against the
damage.  If insurance is not carried
against the damage, or if the available insurance proceeds, in Landlord’s sole
judgment, would be insufficient to cover the cost of repair to the Premises
(inclusive of Tenant Improvements installed prior to the Basic Rent
Commencement Date), Landlord shall either restore the Premises (inclusive of
Tenant Improvements installed prior to the Basic Rent Commencement Date) to the
same condition it was in prior to the damage or taking, including any
alterations or improvements made by parties other than Landlord, or terminate
this Lease by giving Tenant, within sixty (60) days after the damage, at least
fifteen (15) days prior notice specifying the termination date.  Landlord acknowledges that Tenant may request
that the Premises be restored pursuant to this Section 17.01 to a different,
but better, condition than the prior condition of the Premises; provided,
however, that if the cost of restoring the Premises to a different condition
exceeds the cost of restoring the Premises to its existing condition, then
Tenant shall pay the difference in such costs to the extent not covered by
insurance proceeds to Landlord prior to commencement of restoration.

 

In
the event that the Building is damaged or destroyed to the extent that Landlord
shall reasonably determine that the same cannot, with reasonable diligence, be
fully repaired or restored by Landlord within a period of nine (9) months after
the date of receipt of insurance proceeds, Landlord and Tenant each shall have
the option to terminate this Lease. 
Landlord shall notify Tenant in writing within thirty (30) days after
the date of such damage or destruction of its determination whether or not the
Building can be fully repaired or restored within such nine (9) month period (“Determination
Notice”).  In the event Landlord
determines that restoration cannot be effected within such nine (9) month
period, Landlord or Tenant each shall have the option to terminate this Lease
by giving notice to the other party of such termination within seven (7) days
after the date of the Determination Notice, which notice shall specify a
termination date not less than forty-five (45) days nor more than sixty (60)
days following the date of the notice (“Termination Notice”).  Failure to send the Termination Notice in a
timely manner shall be conclusively presumed to be a waiver of such option to
terminate.  If Landlord determines that
the Building can be fully repaired or restored within such nine (9) month
period, or if it is determined that such repair or restoration cannot be made
within such period but neither Landlord or Tenant elects to terminate, this
Lease shall remain in full force and effect.

 

If
the Premises are materially damaged by fire or other casualty during the last
twenty-four (24) months of the Term and Tenant has not exercised its Term
extension rights under this Lease and the estimated restoration period exceeds
the lesser of (i) ninety (90) days or (ii) twenty-five percent (25%) of the
remaining Term, then either Landlord or Tenant shall have the right, exercisable
by notice delivered within thirty (30) days after the date of such fire or
other casualty,  to terminate this Lease,
effective as of the date of delivery of such notice.

 

In
case the Premises are rendered untenantable by fire or other casualty or action
of public authority in consequence thereof, and this Lease is not terminated as
herein provided, a just proportion

 

27

 

of
the Rent and real estate taxes, according to the nature of the injury, shall be
abated until the repair is completed.

 

17.02                 Restoration.

 

Landlord
may, but shall not be required to, repair or restore any Tenant Improvements
made after the Basic Rent Commencement Date, but if Tenant requests that
Landlord do so and Landlord agrees to do so, Tenant shall make the insurance
proceeds applicable thereto available to Landlord, and if the insurance
proceeds will be insufficient to pay the cost thereof, Tenant shall pay the
amount of insufficiency to Landlord prior to commencement of restoration of
such Tenant Improvements by Landlord.  If
Landlord agrees to restore any Tenant Improvements made after the Basic Rent
Commencement Date, the nine (9) month period described in Section 17.01 shall
be increased to take into account the additional time required to restore such
Tenant Improvements, such additional time not to exceed three (3) months.  Landlord shall not be required to rebuild,
repair, or replace any part of Tenant’s furniture, furnishings or fixtures or
equipment. Landlord shall use diligent efforts to minimize impact on Tenant
during restoration, but shall not be liable for any inconvenience or annoyance
to Tenant or injury to the business of Tenant resulting in any way from such
damage or the repair thereof unless Landlord fails to exercise such diligent
efforts.

 

ARTICLE 18

Eminent Domain

 

18.01                 Total
Taking.

 

If
the Premises or the Building should be the subject of a Total Taking, then this
Lease shall terminate as of the date when physical possession of the Building
or the Premises is taken by the condemning authority.

 

18.02                 Partial
Taking.

 

If
there shall occur a Partial Taking, Rent shall be abated by an amount
representing that part of the Rent properly allocable to the portion of the
Premises so taken and Landlord shall, at Landlord’s sole expense, restore and
reconstruct the Building (to the extent of the net proceeds made available to
Landlord) and the Premises to substantially their former condition to the
extent that the same, in Landlord’s judgment, may be feasible.  The Landlord shall have no liability for
interruption of Tenant’s business.

 

18.03                 Awards
and Proceeds.

 

All
Proceeds payable in respect of a Taking shall be the property of Landlord.  Tenant hereby assigns to Landlord all rights
of Tenant in or to such Proceeds, provided that Tenant shall be entitled to
separately petition the condemning authority for any separate award for its
moving expenses and trade fixtures but only if such a separate award will not
diminish the amount of Proceeds payable to Landlord.

 

28

 

ARTICLE 19

Quiet Enjoyment; Mortgagee’s
Rights

 

19.01                 Landlord’s
Covenant.

 

Provided
that an Event of Default has not occurred and is not then continuing, Tenant
shall, subject to the Permitted Exceptions, quietly have and enjoy the Premises
during the Lease Term, without hindrance or molestation from any Person
lawfully claiming by, through or under Landlord.

 

19.02                 Superiority
of Lease:  Option to Subordinate.

 

The
Building is not subject to a mortgage as of the date hereof.  In the event that the Building shall become
subject to any mortgage or deed of trust lien, and the holder thereof desires
to subordinate this Lease,  Landlord,
Tenant and applicable lender shall enter into a subordination, non-disturbance
and attornment agreement (“SNDA”) in form and substance reasonably acceptable
to Tenant (Tenant hereby agrees that the form attached hereto as Exhibit G
is acceptable).  Tenant agrees to execute
and deliver any appropriate instruments necessary to carry out the agreements
contained in this Section 19.02.

 

19.03                 Notice
to Mortgagee.

 

No
act or failure to act on the part of Landlord which would entitle Tenant under
the terms of this Lease, or by law, to be relieved of Tenant’s obligations
hereunder or to terminate this Lease, shall result in a release or termination
of such obligations or a termination of this Lease unless (i) Tenant shall
have first given written notice of Landlord’s act or failure to act to Landlord’s
mortgagees of which Tenant has been given notice by Landlord (if any)
specifying the act or failure to act on the part of Landlord which could or
would give rise to Tenant’s rights, and (ii) such mortgagees, after
receipt of such notice, have had the opportunity to cure such default within a
reasonable time thereafter (not to exceed sixty (60) days after the date of
such notice); but nothing contained in this Section 19.03 shall be deemed
to impose any obligation on any such mortgagees to correct or cure any such
condition.

 

19.04                 Other
Provisions Regarding Mortgagees.

 

If
this Lease or the Rent due hereunder is assigned to a mortgagee as collateral
security for a loan, no such mortgagee shall be deemed to have assumed any of
Landlord’s obligations hereunder solely as a result of such assignment.  A mortgagee to whom this Lease has been so assigned
shall be deemed to have assumed such obligations only if (i) by the terms
of the instrument of assignment such mortgagee specifically elects to assume
such obligations or (ii) such mortgagee has (a) foreclosed its
mortgage, (b) accepted a deed in lieu thereof, (c) taken possession
of the Premises by entry or otherwise, or (d) assumed such obligations by
way of an SNDA or other agreement with Tenant. 
Even if such mortgagee assumes the obligations of Landlord hereunder,
but except to the extent provided in an SNDA or other agreement between the
mortgagee and Tenant, (i) any such obligation under Section 24.01 to
return the Security Deposit to Tenant shall be limited to the amount actually
received by the mortgagee with respect thereto, and (ii) such mortgagee
will be liable for breaches of any of Landlord’s obligations hereunder only to
the extent such breaches occur during the period of ownership by the mortgagee
after foreclosure (or any conveyance by a deed in lieu thereof), all as set 

 

29

 

forth
in Section 25.08. hereof.  If Tenant
is not a public company, Tenant shall from time to time, at the request of
Landlord or any of Landlord’s mortgagees, provide Landlord and such mortgagee
with financial information pertaining to Tenant as Landlord or such mortgagee
may reasonably request.

 

ARTICLE 20

Defaults; Events of Default

 

20.01                 Defaults.

 

The
following shall, if any requirement for notice or lapse of time or both has not
been met, constitute Defaults, and, if such requirement for notice or lapse of
time have been met, constitute Events of Default hereunder:

 

(1)                                  Occurrence of
any event set forth in Article 21 hereof;

 

(2)                                  The failure of
Tenant to pay Rent when the same shall be due and payable and the continuance
of such failure for a period of five (5) days after Landlord shall give
Tenant notice specifying such failure, provided, however, that if Tenant has
failed to timely pay Rent more than two (2) times in a twelve (12) month
period, Tenant shall not be entitled to further notice from Landlord;

 

(3)                                  The failure of
Tenant to observe any covenant made by it in Sections 13.01, 15.01 and 25.03
hereof;

 

(4)                                  The failure of
Tenant to keep, observe or perform any of the other covenants, conditions and
agreements herein contained on Tenant’s part to be kept, observed or performed
and the continuance of such failure without the curing of same for a period of
thirty (30) days after receipt by Tenant of notice in writing from Landlord
specifying in reasonable detail the nature of such failure.

 

20.02                 Extended
Cure Period.

 

In
the event that the Default under Section 20.01(4) is of such a nature
that it cannot be cured within such thirty (30) day period, then such Default
shall not be deemed to be an Event of Default so long as Tenant, after
receiving such notice, proceeds to cure the Default as soon as reasonably
possible and continues to take all steps reasonably necessary to complete the
same within a period of time which, under all prevailing circumstances, shall
be reasonable.  No such Default shall be
deemed to be an Event of Default if and so long as Tenant shall be so
proceeding to cure the same in good faith or be delayed in or prevented from
curing the same by reason of Force Majeure.

 

30

 

ARTICLE 21

Insolvency

 

21.01                 Insolvency.

 

If
(1) there occurs with respect to Tenant an Insolvency or (2) any
execution or attachment is issued against Tenant or any of its property and as
a result thereof the Premises are taken or occupied by some Person other than
Tenant, except as may herein be permitted, then an Event of Default hereunder
shall be deemed to have occurred so that the provisions of Article 22
hereof shall become effective and Landlord shall have the rights and remedies
provided for therein.

 

ARTICLE 22

Landlord’s Remedies; Damages on
Default

 

22.01                 Landlord’s
Remedies.

 

If
an Event of Default shall occur and be continuing, Landlord may, at its option,
give to Tenant a notice terminating this Lease upon a date specified in such
notice, or Landlord may enter the Premises for the purpose of terminating this
Lease, and upon the date specified in said notice or upon such entry the term
and estate hereby vested in Tenant shall cease and any and all other right, title
and interest of Tenant hereunder shall likewise cease without further notice or
lapse of time, as fully and with like effect as if the entire Lease Term had
lapsed, but Tenant shall continue to be liable to Landlord as hereinafter
provided.

 

If
such Event of Default results from Tenant’s failure to pay any sums payable
under Section 7.01, Landlord may, at its option, in addition to or in lieu
of the other remedies available to Landlord, refuse Tenant access to the
Premises.

 

22.02                 Surrender.

 

Upon
any termination of this Lease as the result of an Event of Default, Tenant
shall quit and peacefully surrender the Premises to Landlord.  Upon or at any time after any such
termination, Landlord may without further notice enter the Premises and possess
itself thereof by summary proceedings or otherwise, and may dispossess Tenant
and remove Tenant and all other Persons and property from the Premises and may
have, hold and enjoy the Premises and the right to receive all rental income of
and from the same.

 

22.03                 Right
to Relet.

 

At
any time from time to time after any termination of this Lease as the result of
an Event of Default, Landlord may relet the Premises or any part thereof, in
the name of Landlord or otherwise, for such term or terms (which may be greater
or less than the period which would otherwise have constituted the balance of
the Lease Term) and on such conditions (which may include concessions or free
rent) as Landlord, in its reasonable discretion, may determine and may collect
and receive the rents therefor.  Landlord
shall in no way be responsible or liable for any failure to relet the Premises
or any part thereof, or for any failure to collect any rent due upon any such
reletting.

 

31

 

22.04                 Survival
of Covenants.

 

No
termination of this Lease as the result of an Event of Default shall relieve
Tenant of its liability and obligations under this Lease and such liability and
obligations shall survive any such termination. 
Tenant shall indemnify and hold Landlord harmless from all loss, cost,
expense, damage or liability arising out of or in connection with such
termination.

 

In
the event of any such termination, Tenant shall pay to the Landlord the Rent up
to the date of such termination.  Tenant
shall also pay to Landlord, on demand, as and for liquidated and agreed damages
for Tenant’s Default, the present value of the difference between

 

(1)                                  the aggregate
Rent which would have been payable under this Lease by Tenant from the date of
such termination until the Stated Expiration Date, and

 

(2)                                  the fair and
reasonable rental value of the Premises for the same period excluding Landlord’s
reasonable estimate of expenses to be incurred in connection with reletting the
Premises, including, without limitation, all repossession costs, brokerage
commissions, legal expenses, reasonable attorney’s fees, alteration costs and
expenses of preparation for such reletting.

 

If
the Premises or any part thereof shall be relet by Landlord before presentation
of proof of such liquidated damages to any court, commission or tribunal, the
amount of rent reserved upon such reletting shall be, prima facie, the
fair and reasonable rental value for the part or the whole of the Premises so
relet during the term of the reletting.

 

As
additional and cumulative obligations after any such termination, Tenant shall
also pay punctually to Landlord all the sums and shall perform all the
obligations which Tenant covenants in this Lease to pay and to perform in the
same manner and to the same extent and at the same time as if this Lease had
not been terminated.  In calculating the
amounts to be paid by Tenant pursuant to the preceding sentence, Tenant shall
be credited with any amount paid to Landlord pursuant to the second paragraph
of this Section 22.04 and also with the net proceeds of any rent obtained
by Landlord by reletting the Premises, after deducting all Landlord’s
reasonable expenses in connection with such reletting, including, without
limitation, all repossession costs,  fees
for legal services and expenses of preparing the Premises for such reletting,
all to the extent Landlord has not been previously compensated therefor by
Tenant, it being agreed by Tenant that Landlord may (i) relet the Premises
or any part or parts thereof for a term or terms which may at Landlord’s option
be equal to or less than or exceed the period which would otherwise have
constituted the balance of the term hereof and may grant such concessions and
free rent as Landlord in its reasonable judgment considers advisable or
necessary to relet the same and (ii) make such alterations, repairs and
decorations in the Premises as Landlord in its reasonable judgment considers
advisable or necessary to relet the same, and no action of Landlord in
accordance with the foregoing or failure to relet or to collect rent under
reletting shall operate or be construed to release or reduce Tenant’s liability
as aforesaid.

 

Nothing
herein contained shall limit or prejudice the right of Landlord to prove for
and obtain in proceedings for bankruptcy or insolvency by reason of the
termination of this Lease, an amount equal to the maximum allowed by any
statute or rule of law in effect at the time when, and governing 

 

32

 

the
proceedings in which, such damages are to be proved, whether or not such amount
be greater, equal to, or less than the amount of the difference referred to
above.

 

22.05                 Right
to Equitable Relief.

 

If
there shall occur a Default or threatened Default, Landlord shall be entitled
to enjoin such Default or threatened Default and shall have the right to invoke
any right and remedy allowed at law or in equity or by statute or otherwise as
though re-entry, summary proceedings, and other remedies were not provided for
in this Lease.

 

22.06                 Landlord’s
Right to Self Help;  Interest on Overdue
Rent.

 

If
an Event of Default shall occur and be continuing, Landlord shall have the
right, but shall not be obligated, to enter upon the Premises and to
perform  the defaulted obligation notwithstanding
the fact that no specific provision for such substituted performance by
Landlord is made in this Lease with respect to such Event of Default.  In performing such obligation, Landlord may
make any payment of money or perform any other act.  The aggregate of (i) all sums so paid by
Landlord, (ii) interest (at the rate of 1 1/2% per month or the highest
rate permitted by law, whichever is less) on such sums and (iii) all
necessary incidental costs and expenses in connection with the performance of
any such act by Landlord, shall be deemed to be Rent under this Lease and shall
be payable to Landlord immediately upon demand. 
Landlord may exercise the foregoing rights without waiving any other of
its rights or releasing Tenant from any of its obligations under this Lease.

 

All
Rent not paid when due shall bear interest at the rate provided in the
preceding paragraph, payable on demand.

 

22.07                 Payment
of Landlord’s Cost of Enforcement.

 

Tenant
shall pay, on demand, Landlord’s expenses, including reasonable attorney’s
fees, incurred in enforcing any obligation of Tenant under this Lease or in
curing any default by Tenant under this Lease as provided in Section 22.06.

 

22.08                 Further
Remedies.

 

Upon
any termination of this Lease pursuant to Section 22.01, or at any time
thereafter, Landlord may, in addition to and without prejudice to any other
rights and remedies Landlord shall have at law or in equity, re enter the
Premises, and recover possession thereof and may dispossess any or all
occupants of the Premises in the manner prescribed by the statute relating to
summary proceedings, or similar statute(s); but Tenant in such case shall
remain liable to Landlord as hereinbefore provided.

 

33

 

ARTICLE 23

Waivers; Landlord Default

 

23.01                 No
Waivers.

 

Failure
of Landlord to complain of any act or omission on the part of Tenant no matter
how long the same may continue, shall not be deemed to be a waiver by said
Landlord of any of its rights hereunder. 
No waiver by Landlord of any provision of this Lease shall be deemed a
waiver of a breach of the same or any other provision.  No acceptance by Landlord of any partial
payment shall constitute an accord or satisfaction but shall only be deemed a
partial payment on account.

 

23.02                 Landlord
Default

 

Landlord
shall be deemed to be in default of this Lease if Landlord shall be in default
in the prompt and full performance of any other of its promises, covenants or
agreements contained in this Lease and such default in performance continues
for more than thirty (30) days after written notice thereof from Tenant to
Landlord specifying the particulars of such default or breach of performance;
provided, however, that if the default complained of, other than for the
payment of monies, is of such a nature that the same cannot be rectified or
cured within such thirty (30) day period, then such default shall be deemed to
be rectified or cured if Landlord, within such thirty (30) day period, shall
have commenced such cure and shall continue thereafter with due diligence to
cause such cure to be completed.  Upon
any default of this Lease by Landlord, Tenant shall be entitled to pursue any
and all remedies available to Tenant at law or in equity.

 

ARTICLE 24

Security Deposit

 

24.01                 Security
Deposit.

 

Tenant
has deposited the Security Deposit with Landlord.  Landlord shall hold the Security Deposit as
security for the full and faithful payment or performance by Tenant of its
obligations under this Lease and not as a prepayment of Rent. Landlord may
commingle the Security Deposit with other funds of Landlord and shall not be
liable to Tenant for the payment of interest thereon or profits therefrom.
Landlord may expend such amounts from the Security Deposit as may be necessary
to cure any Default and, in such case, Tenant shall pay to Landlord the amount
so expended, on demand.  Landlord may
assign the Security Deposit to any subsequent owner of the Building and
thereafter Landlord shall have no further liability to Tenant with respect
thereto.  As soon as reasonably
practicable after the Lease Termination Date, Landlord shall (i) inspect
the Premises, (ii) make such payments from the Security Deposit as may be
required to cure any outstanding Default hereunder and (iii) if no Default
is then continuing, pay the balance of the Security Deposit to Tenant.

 

The
Security Deposit may be in the form of an irrevocable, unconditional,
negotiable letter of credit (the “Letter of Credit”). The Letter of Credit
shall: (a) be in the  amount
required hereby; (b) be in form and substance satisfactory to Landlord; (c) name
Landlord as its beneficiary; (d) be drawn on an FDIC insured financial
institution reasonably satisfactory to the Landlord; (e) expire no earlier
than sixty (60) days after the Termination Date of this Lease (f) be
transferable by Landlord as beneficiary 

 

34

 

upon
presentation of the letter of credit, a transfer certificate in the form
attached to the letter of credit and the payment by Landlord of a transfer
administrative fee acceptable to Landlord set forth on the face of the letter
of credit.  If any reasonable transfer
fee is required in connection with the sale of the Building by Landlord,
Landlord shall be solely responsible for payment of such fee. If Landlord shall
reasonably determine at any time that the issuer is no longer satisfactory,
Tenant shall provide a replacement Letter of Credit complying with the
foregoing within thirty (30) days after notice from Landlord.

 

ARTICLE 25

General Provisions

 

25.01                 Force
Majeure.

 

In
the event that Landlord or Tenant shall be delayed, hindered in or prevented
from the performance of any act required hereunder by reason of Force Majeure,
then performance of such act shall be excused for the period of the delay and
the period for the performance of any such act shall be extended for a period
equivalent to the period of such delay.

 

25.02                 Notices
and Communications.

 

All
notices, demands, requests, consents, approvals and other communications provided
for or permitted under this Lease shall be in writing, either delivered by hand
or sent by registered or certified mail, postage prepaid or by a recognized
courier which maintains delivery records, to the following address:

 

(a)                                  if to Landlord
at the address stated in Section 1.01 hereof, or at such other address as
Landlord shall have designated in writing to the Tenant, with a copy to such
Persons as Landlord shall have designated in writing to Tenant; or

 

(b)                                 if to Tenant at
the address stated in Section 1.01 hereof, or at such other address as
Tenant shall have designated in writing to Landlord, with a copy to such
persons as Tenant shall have designated in writing to Landlord.

 

Any
notice provided for herein shall become effective only upon and at the time of
receipt by the Person to whom it is given, unless such notice is mailed by
registered or certified mail, in which case it shall be deemed to be received
on (i) the third Business Day following the mailing thereof or (ii) the
day of its receipt, if a Business Day, or the next succeeding Business Day,
whichever of (i) or (ii) shall be the earlier.

 

25.03                 Tenant
Estoppel Certificate.

 

Tenant
shall, without charge, at any time and from time to time hereafter, within
fifteen (15) days after written request of Landlord, certify by written
instrument in the form of Exhibit F, duly executed and acknowledged to
Landlord or any mortgagee or purchaser, or proposed mortgagee or proposed
purchaser, or any Person specified in such request; (a) as to whether this
Lease has been supplemented or amended, and if so, the substance and manner of
such supplement or amendment, (b) 

 

35

 

as
to the existence of any Default or Event of Default, (c) as to the
existence of any offsets, counterclaims or defenses thereto on the part of
Tenant, (d) as to the Term Commencement Date and Stated Expiration Date,
and (e) as to the other matters set forth in Exhibit F and any other
matters as Landlord may reasonably request. 
Any such certificate may be relied upon by Landlord and any other Person
to whom the same may be exhibited or delivered, and the contents of such
certificate shall be binding on the party executing same.

 

25.04                 Governing
Law.

 

This
Lease and the performance thereof shall be governed, interpreted, construed and
regulated by the laws of The Commonwealth of Massachusetts.

 

25.05                 Partial
Invalidity.

 

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

 

25.06                 Notice
of Lease.

 

The
parties will at any time, at the request of either one, promptly execute
duplicate originals of an instrument, in recordable form, which will constitute
a Notice of Lease, setting forth a description of the Premises and the Lease
Term.  The cost of review and recording
shall be borne by Tenant.

 

25.07                 Interpretation.

 

The
Section headings used herein are for reference and convenience only and
shall not enter into the interpretation hereof. 
This Lease may be executed in several counterparts, each of which shall
be an original, but all of which shall constitute one and the same instrument.

 

25.08                 Bind
and Inure; Limitation of Landlord’s Liability.

 

The
obligations of this Lease shall run with the land, and this Lease shall be
binding upon and inure to the benefit of the parties hereto and their
respective successors and assigns. No owner of the Land and Building shall be
liable under this Lease except for breaches of Landlord’s obligations occurring
while owner of the Land and Building. 
The obligations of Landlord shall be binding upon the assets of Landlord
which comprise the Land and Building but not upon other assets of
Landlord.  No individual partner,
trustee, stockholder, officer, director, employee or beneficiary of Landlord
shall be personally liable under this Lease and Tenant shall look solely to Landlord’s
interest in the Land and Building in pursuit of its remedies upon an event of
default hereunder, and the general assets of Landlord and its partners,
trustees, stockholders, officers, employees or beneficiaries of Landlord shall
not be subject to levy, execution or other enforcement procedure for the
satisfaction of the remedies of Tenant.

 

36

 

 

25.09                 Parties.

 

Except
as herein otherwise expressly provided, the covenants, conditions and
agreements contained in this Lease shall be binding upon the heirs, successors
and assigns of the Parties hereto.

 

ARTICLE 26

Miscellaneous

 

26.01                 Holdover.

 

In the event Tenant shall fail to vacate the Premises by the Lease
Termination Date, Tenant shall pay Basic Rent to Landlord in an amount equal to
one and one-half (1.5) times the monthly Basic Rent for each month or portion
thereof that Tenant remains in possession (the “Holdover Rental Rate”). Tenant
shall also pay all Additional Rent provided herein.  The Holdover Rental Rate shall be paid
monthly in advance to Landlord.  In
determining the Holdover Rental Rate Landlord shall charge one and one-half
(1.5) times the monthly Basic Rent in effect for the last full calendar month
of the Lease Term.  In addition to the
Holdover Rental Rate, Landlord shall be entitled to seek to recover full
damages sustained as a result of said holdover if such holdover is greater than
thirty (30) days after the Lease Termination Date.

 

26.02                 Reciprocal
Litigation Costs

 

In
the event of any litigation between Landlord and Tenant, the unsuccessful party
as determined by a court of competent jurisdiction shall reimburse the
successful party for all reasonable legal fees and expenses incurred by the
successful party in prosecuting or defending any such action.

 

26.03                 Brokerage.

 

Tenant
warrants and represents to Landlord that it has had no dealings with any broker
or agent in connection with this Lease other than T3 Realty Advisors, LLC and
covenants to defend, with counsel approved by Landlord, hold harmless and
indemnify Landlord from and against any and all cost, expense or liability for
any compensation, commissions and charges claimed by any broker or agent other
than T3 Realty Advisors, LLC based upon dealings with Tenant.  Landlord shall pay T3 Realty Advisors, LLC a
commission based on a standard Industrial schedule.

 

In
the event Tenant exercises its Right of First Offer during the original lease
term on the additional 22,000 square feet and a mutually acceptable lease
amendment is executed between Landlord and Tenant incorporating this additional
square footage into the Lease, and T3 Realty Advisors, LLC remains the broker
of record, T3 Realty Advisors, LLC shall be paid an additional commission by
the Landlord based on a standard industrial schedule.

 

26.04                 Landlord’s
Expenses Regarding Consents.

 

Tenant
shall reimburse Landlord promptly on demand for all reasonable legal and other
out-of-pocket expenses incurred by Landlord in connection with all requests by
Tenant for consent or 

 

37

 

approval
hereunder, except that there shall be no charge to Tenant for Landlord’s review
of the initial Tenant Improvement Plans.

 

26.05                 Financial
Statements.

 

If
Tenant is not a public company, within ten (10) days after request by Landlord
from time to time, Tenant shall deliver to Landlord Tenant’s audited financial
statements (which shall be for the latest available year and in any event for a
year ended not more than fifteen (15) months prior to Landlord’s request).  Such financial statements may be delivered to
Landlord’s mortgagees and lenders and prospective mortgagees, lenders,
investors and purchasers.

 

26.06                 Signage.

 

Landlord
will permit Tenant to install, at Tenant’s sole cost and expense, exterior
building signage on the I-495 (east) side of the Building as well as monument
signage at the main entrance off 
Flanders Road and on the exterior of the Building above the main
entrance.  Landlord will provide
appropriate directional signage for deliveries. 
All signage shall be subject to Landlord’s reasonable prior approval,
such approval not to be unreasonably withheld, and in accordance with Legal
Requirements.

 

26.07                 Option
to Extend Term.

 

Tenant
shall have the option to extend the term of this Lease for one (1) five (5)
year extension term (“Extension Term”) provided (i) no Event of Default shall
exist at the time such option is exercised (ii) Tenant has not assigned this
Lease or sublet the Premises at the time such option is exercised, and (iii)
Tenant shall give written notice to Landlord of its exercise of such option not
less than nine (9) months prior to expiration of the original term, time being of the essence for the giving of such
notice.  The giving of such
notice by Tenant shall automatically extend the Term of this Lease for the
Extension Term and no instrument of renewal need be executed.  All of the terms and provisions of this Lease
shall be applicable during the Extension Term except (a) Tenant shall have no
option to extend the term of the Lease beyond the Extension Term, (b) the Basic
Rent for the Extension Term shall be the greater of the Basic Rent in effect
immediately prior to the Extension Term or ninety-five percent (95%) of the
then Market Rent (defined below) as of the first day of the Extension Term.

 

“Market
Rent” shall be computed as of the applicable date at the then current rentals
being charged to new tenants for comparable space located in the vicinity of
the Building, taking into account and giving effect to, in determining
comparability, without limitation, such considerations as size, location, and
lease term.

 

Landlord
shall initially designate the Market Rent and shall furnish data in support of
such designation.  If Tenant disagrees
with Landlord’s designation of Market Rent, then Tenant shall have the right,
by written notice given within twenty-one (21) days after Tenant has been
notified of Landlord’s designation, to submit such Market Rent to arbitration
as follows.  Market Rent shall be
determined by arbitrators, one to be chosen by Tenant, one to be chosen by
Landlord and a third to be selected, if necessary, as below provided.  If within twenty (20) days after Tenant’s
notice, the parties 

 

38

 

agree
upon a single arbitrator, Market Rent shall be determined by such
arbitrator.  The unanimous written
decision of the two first chosen arbitrators without selection and
participation of a third arbitrator, or otherwise the written decision of a
majority of the three arbitrators chosen and selected as provided herein, shall
be conclusive and binding upon Landlord and Tenant.  Landlord and Tenant shall each notify the
other of its chosen arbitrator within twenty-one (21) days following the call
for arbitration and, unless such two arbitrators shall have reached a unanimous
decision within thirty (30) days after their designation, then they shall so
notify the then President of the Boston Bar Association and request him to
select an impartial third arbitrator, who shall be another office building
owner, a real estate counselor or a broker dealing with like types of
properties, to determine Market Rent as herein defined.  Such third arbitrator and the first two
chosen shall hear the parties and their evidence and render their decision
within thirty (30) days following the conclusion of such hearing and notify
Landlord and Tenant thereof. Landlord and Tenant shall bear the expense of the
third arbitrator (if any) equally. If the dispute between the parties as to
Market Rent has not been resolved before the commencement of Tenant’s
obligation to pay rent under the Lease in Market Rent, then Tenant shall pay
rent under the Lease in respect of the Premises based upon the Market Rent
designated by Landlord until either the agreement of the parties as to the
Market Rent or the decision of the arbitrators, as the case may be, at which
time Tenant shall pay any underpayment of rent to Landlord, or Landlord shall
refund any overpayment of rent to Tenant.

 

26.08                 Tenant’s
Option to Terminate.

 

Tenant
shall have the right, on the date which is the fifth (5th) anniversary of the Basic
Rent Commencement Date (the “Termination Date”), to terminate this Lease.  Such option shall be exercised by Tenant
giving Landlord notice (the “Termination Notice”) of its intention so to
terminate, which notice shall be given not less than twelve (12) months prior
to the Termination Date, time being of the
essence for the giving of such notice.  If Tenant exercises its termination option as
aforesaid, then this Lease shall terminate as of the Termination Date just as
if such date were the date of expiration of the Term, provided, however, that
Tenant shall pay to Landlord, and as a condition to the effectiveness of the
Termination Notice, a payment (the “Termination Payment”) equal to the
following unamortized transaction costs: leasing commissions, the Allowance (as
defined in Exhibit C), costs of the Predelivery Landlord’s Work and the
Additional Landlord’s Work, reasonable attorney’s fees, reasonable
architectural and engineering fees, all amortized on a level payment direct
reduction basis over the original Term, with interest at the rate of ten percent
(10%) interest per annum, plus an amount equal to six (6) months of the Basic
Rent at the rate provided for the last five (5) years of the Lease Term.  The Termination Payment shall be due with the
Termination Notice.  At the request of
either party, the amount of the Termination Payment shall be memorialized in
writing once all costs have been finally determined.

 

26.09                 Expansion;
Right of First Offer.

 

(a)           In
the event Tenant requests expansion into the remaining 22,000 square foot space
(the “Expansion Space”) currently leased (the “Bel Lease”) by Bel Power (“Bel”)
prior to Bel’s lease expiration date of February 28, 2014 (the “Bel Expiration
Date”), Landlord shall use its best efforts (but without liability if it shall
be unsuccessful) to enter into an early termination with Bel and, if Landlord
is successful, this Lease shall be amended to incorporate the Expansion Space
on all of the 

 

39

 

same
terms and conditions as are applicable to the Premises, and the Term of the
Lease for the Expansion Space shall be coterminous with the Lease Term except
that (i) the Expansion Space shall be leased AS IS with no Landlord
construction obligations and no allowance except that Landlord shall complete
the Bel Power Space Environmental Work in the Expansion Space shown on Exhibit
C prior to Tenant’s occupancy thereof and (ii) for the period prior to February
28, 2014, the Basic Rent shall be the per square foot Basic Rent in effect from
time to time under this Lease, adjusted to compensate Landlord for the net cost
to Landlord of effecting such early termination (including any reduction of
rent arising therefrom), if any, but in no event shall the Basic Rent for the
Expansion Space for the period from the Expansion Space Rent Commencement Date
(as hereinafter defined) to February 28, 2014 exceed the basic rent that would
have been payable under the Bel Lease during such period; and from and after
March 1, 2014 through the Stated Expiration Date (as the same may be extended
or terminated), the Basic Rent for the Expansion Space shall be the per foot
Basic Rent in effect from time to time under this Lease.  Landlord’s obligation to use its best efforts
to enter into an early termination of the Bel Lease pursuant to this Section
26.09(a) shall not include any obligation to make any termination or other
payment to Bel unless Tenant provides the funds therefor.

 

The “Expansion Space Rent Commencement Date” shall
be the date upon which the Expansion Space is delivered to Tenant broom clean
and free of all occupants with the Bel Power Space Environmental Work shown on
Exhibit C complete.

 

(b)           Provided
Tenant has not committed more than two (2) Events of Default in the preceding
eighteen (18) month period prior to exercise, Tenant shall have a continuing
right of first offer to lease the Expansion Space on the following terms and
conditions:

 

(i)                                     Prior to
offering the Expansion Space for lease to third parties, Landlord shall first
advise Tenant in writing (the “Offer Notice”) of the terms and conditions upon
which Landlord is prepared to lease the Expansion Space, including term, rent,
additional rent and, if applicable, tenant improvement and allowance packages,
free rent and any other relevant terms (the “Offered Terms”);

 

(ii)                                  Tenant shall
accept or reject the offer made in the Offer Notice within fifteen (15) days
after the date of delivery of the Offer Notice (Tenant’s failure to accept such
offer in writing within such fifteen-day period shall be deemed an election to
reject such offer);

 

(iii)                               In the event
Tenant timely accepts the offer set forth in the Offer Notice, Landlord and
Tenant shall within fifteen (15) days after the date of acceptance enter into
an amendment to this Lease incorporating the Expansion Space into the Premises
on the Offered Terms, except that if the Offered Terms for the Expansion Space
include a term that would expire before the expiration date of the  Lease Term, then the term for the Expansion
Space shall be extended to be made coterminous with the  Lease Term, and the Rent for such extended
period shall be the Rent in effect for the final year as set forth in the
Offered Terms;

 

40

 

(iv)                              In the event
Tenant rejects or is deemed to have rejected the offer set forth in the Offer
Notice, Landlord shall be free for a period of 210 days after the date of
rejection or deemed rejection (the “Marketing Period”) to lease the Expansion
Space to a third party or parties on terms not materially more favorable to such
party or parties than the Offered Terms (with respect to rental rate, “materially”
as used herein shall mean a net effective rental rate that is more than ten
percent (10%) lower than the net effective rental rate set forth in the Offer
Notice); and

 

(v)                                 In the event
Landlord has not by expiration of the Marketing Period executed a lease with a
third party complying with the provisions of clause (iv) above, then Tenant’s
right of first offer shall again apply to the Expansion Space.

 

(c)           Notwithstanding
anything to the contrary contained herein, if, prior to the Bel Expiration
Date, Bel desires to assign its interest under the Bel Lease or sublease all or
a portion of the Expansion Space to a third-party, Landlord shall notify Tenant
of the proposed Bel assignment or subletting within two (2) business days after
Landlord receives notice thereof from Bel. 
If Tenant notifies Landlord within five (5) days after receipt of notice
from Landlord that Tenant desires to expand into the Expansion Space (or the portion
thereof available), Landlord shall terminate the lease with Bel in the case of
an assignment or, in case of a sublease, terminate the Bel Lease with respect
to the portion of the Expansion Space intended to be subject thereto, such
termination to be effective as of the date such assignment or sublease would
have commenced.  If Landlord terminates
the Bel Lease in whole or in part pursuant to the foregoing, Tenant shall lease
the Expansion Space (or portion thereof) as of the Expansion Space Rent Commencement
Date on the terms and conditions set forth in Section 26.09(a) above.

 

(d)           Notwithstanding
anything to the contrary contained herein or in the Bel Lease, if Bel agrees to
assign its interest under the Bel Lease or sublease the Expansion Space to Tenant,
no consent of Landlord shall be required and, if the Bel Lease is assigned to
Tenant, Landlord shall execute such release of Bel of Bel’s obligations under
the Bel Lease for the period following assignment as may reasonably be
requested by Bel. Landlord shall not be required to complete the Bel Power
Space Environmental Work in the Expansion Space shown on Exhibit C. Upon the
expiration of the assignment or subletting arrangement with Bel on the Bel
Expiration Date, this Lease shall be amended to incorporate the Expansion Space
on all of the same terms and conditions as are applicable to the Premises, and
the Basic Rent for the Expansion Space shall be the per square foot rental rate
then in effect under this Lease for the remainder of the Premises, and (iii)
the term of the lease for the Expansion Space shall be coterminous with the
Lease Term (as the same may be extended or terminated).

 

26.10                 HVAC.

 

Tenant
shall have the right to operate the multiple gas fired roof top units with
supplemental gas fired hanging heaters at the Premises twenty-four (24) hours
per day, seven (7) days per week.  Tenant
shall have full control of the temperature within the Premises.  Subject to Landlord’s review and approval of
the HVAC Equipment specifications and Tenant’s installation plans by a
qualified contractor or vendor selected by Tenant in its sole discretion, such
approval not to be unreasonably 

 

41

 

withheld,
Tenant shall be permitted to replace, at Tenant’s sole cost, the heating,
ventilating, and air conditioning systems and appurtenances (“HVAC Equipment”)
serving the Premises throughout the Lease Term with equal or better
equipment.  Any such installation of HVAC
Equipment by Tenant during the Term shall be performed in a manner that does
not void the current roof warranty of the Building.  Tenant shall be responsible for the cost of
replacement of HVAC Equipment throughout the Lease Term; provided, however,
that Landlord shall not be permitted to seek reimbursement from Tenant for
replacement of any HVAC Equipment that is not beyond its useful life unless
such HVAC Equipment is malfunctioning or non-functional.

 

26.11                 Generator.

 

Tenant,
at Tenant’s sole cost, shall have the right to install a generator on an existing
pad on the south side of the Building, with Landlord approval, not to be
unreasonably withheld.

 

26.12                 LN2
Tank.

 

Landlord
shall endeavor (at no cost to Landlord) to arrange for the use by Tenant of an
existing LN2 tank at the Building that is operated and leased by another
tenant.   If Tenant is permitted use of
such tank, Tenant shall have the right but not the obligation to change the
size of the tank.  Use of the tank shall
be subject to Landlord’s review and approval, not to be unreasonably withheld.

 

26.13                 Test
Trailer.

 

Subject
to Landlord’s approval, which shall not be unreasonably withheld, and
compliance by Tenant with all applicable Legal Requirements, Tenant, at its
expense, shall have the right to install a test trailer (the “Test Trailer”) on
the Premises, to be located at the rear of Building in the parking lot or on
existing concrete slab.  Tenant, at its
expense, will install power to this Test Trailer

 

26.14                 Patio.

 

Subject
to Landlord’s approval, which shall not be unreasonably withheld, and
compliance by Tenant will all applicable Legal Requirements, Tenant shall have
the right to construct a patio for outdoor seating located near rear employee
entrance.

 

26.15                 Smoking
Area.

 

Subject
to Landlord’s approval, which shall not be unreasonably withheld, and
compliance by Tenant will all applicable Legal Requirements, Tenant shall have
the right to install an outdoor covered smoking area located near employee
entrance.

 

26.16                 Loading.

 

Tenant
shall have the exclusive use of all loading docks within its Premises.  Landlord shall allow Tenant to construct a
metal structure around four (4) of the loading docks to create a secure and
weather resistant enclosure large enough to house 53 foot tractor trailers.  Construction and use of this 

 

42

 

structure
shall be subject to all applicable Legal Requirements and Landlord’s review and
approval, not to be unreasonably withheld.

 

26.17                 Parking.

 

Tenant
shall be provided parking in common with the other tenants at the Building on
an open lot adjacent to the Building in accordance with the terms of “Exhibit I”
attached hereto.

 

26.18                 Roof.

 

Landlord
represents and warrants that the roof of the Building was replaced with a Sika
Sarnafil 60 mil, fully adhered white PVC roof in April, 2009.  Landlord shall provide to Tenant, upon Tenant’s
request, a copy of the twenty (20) year manufacturer warranty obtained in
connection with this roof replacement.

 

26.19                 Compliance
with Laws.

 

Landlord
represents and warrants to Tenant that as of the date hereof (a) the base
Building core, shell and surrounding site work comply in all material respects
with all applicable zoning, land use and environmental laws, regulations,
agreements and building codes, including without limitation, the requirements
of the Americans with Disabilities Act (ADA) and all regulations thereunder,
and the requirements of all easement and encumbrance documents and, subject to
Tenant’s obligations under this Lease, Landlord covenants to keep the same
materially, in compliance throughout the Term; (b) the Permitted Uses are
permitted as of right on the parcel described on “Exhibit A”; (c) Landlord
holds fee simple title to the parcel described on “Exhibit A”, subject to no
mortgage; (d) Landlord has full power and authority to enter into this Lease
and has obtained all consents and taken all actions necessary in connection
therewith; and (e) no other party has any possessory right to the Premises or
has claimed the same.

 

26.20                 Environmental.

 

Landlord
covenants that it has provided to Tenant all reports and material documents
relating to the environmental status of the Land and the Building in Landlord’s
possession.  Prior to the Term
Commencement Date, Landlord shall perform the environmental testing provided in
Exhibit C.

 

26.21                 Expedited
Arbitration.

 

Whenever
this Lease calls for expedited arbitration, such arbitration shall be conducted
under this Section 26.21.  An arbitration
under this Section 26.21 (“Expedited Arbitration”) shall be conducted by one
neutral Arbitrator (who shall be retired judge experienced in resolving
commercial real property disputes in Massachusetts and who shall be independent
and unaffiliated with either party) mutually agreed upon by the parties, or if
they cannot agree on a single arbitrator within five (5) business days after
this Section 26.21 is invoked, then by JAMS, which shall select such single
arbitrator from a list of no more than five (5) names submitted by each party
to the Expedited Arbitration.  The
Arbitrator so selected shall then hold a hearing within five (5) business days
after notification to him of his selection, at which each party may present its
position on the issue in 

 

43

 

question,
with any written documents and testimony of witnesses that such party believes
is necessary to support its position; provided, however, no party shall be
permitted to present more than eight (8) hours of witness testimony and
argument to the Arbitrator, unless both parties agree otherwise.  There shall be no discovery procedures
allowed in connection with such Expedited Arbitration, and no party shall have
any contact with the Arbitrator except at the hearing.  The Arbitrator shall render his decision on
the issue by a written notice to the parties involved within five (5) business
days after concluding the hearing (which may be adjourned by the Arbitrator in
his reasonable discretion).  The decision
of the Arbitrator shall be final and binding on and non-appealable by the parties
for the purposes of this Agreement and may be enforced by a court of competent
jurisdiction.  Except as provided
otherwise herein, such Expedited Arbitration shall be conducted in accordance
with the Commercial Arbitration Rules of JAMS or the American Arbitration
Association.  If JAMS shall cease to
exist and/or shall decline to serve under this Agreement as to any matter under
dispute that has been submitted to Expedited Arbitration, then the parties
shall mutually select an alternative qualified arbitrator, and in the absence
of an agreement with respect thereto within five (5) business days, either
party shall have the right, upon written notice to the other party, to apply to
the President of the Boston Bar Association for the selection of an independent,
unaffiliated and qualified arbitrator. 
If awarded by the Arbitrator, the prevailing party in any decision of
the Arbitrator under this Section 26.21 shall be reimbursed its reasonable
costs and expenses in participating in such proceeding by the other parties
thereto, including all fees charged by the Arbitrator.  Neither party shall have previously employed
or shall have had a prior contractual relationship with any Arbitrator that is
chosen pursuant to this Section 26.21. 
The provisions of this Section 26.21 shall only be applicable to matters
or events expressly provided for in this Lease to be resolved by expedited
arbitration and not otherwise.

 

44

 

26.22                 Landlord
Cooperation.

 

Landlord is aware that Tenant intends to apply for
federal, state and local grants, loans, tax abatements and reductions and other
incentives with respect to its business to be conducted at the Premises.
Landlord agrees to reasonably cooperate (at no out-of-pocket expense to
Landlord and without incurring any liability to Landlord on account of such
cooperation) with such activities and in no way object to or impede such
activities.  In connection with the
foregoing, Landlord agrees, at the request of Tenant, to execute any
commercially reasonable documentation related to the foregoing.  Further,
and notwithstanding anything to the contrary set forth in this Lease, Tenant
shall have the right to pledge or otherwise grant a first priority security
lien or other interest in any of Tenant’s furniture, fixtures, equipment or
other personal property (“Tenant’s Property”) to the United States Department
of Energy, Massachusetts Clean Energy Technology Center and/or any other party
providing financing to Tenant in connection with the conduct of Tenant’s
business in the Premises, and upon written request by Tenant, Landlord will
execute and
deliver commercially reasonable instrument(s) consenting to
such financing and/or waiving any statutory or contractual Landlord’s lien in
Tenant’s Property.

 

ARTICLE 27

Entire Agreement

 

27.01                 Entire
Agreement.

 

No
oral statement or prior written matter shall have any force or effect.  This Agreement shall not be modified or
canceled except by writing subscribed to by all parties.

 

No
representations, inducement, promises or agreements, oral or otherwise, between
Landlord and Tenant or any of their respective brokers, employees or agents,
not embodied herein, shall be of any force or effect.

 

The
submission of this Lease for examination, review, negotiation and/or signature
shall not constitute an offer or an option to lease or a reservation of the
Premises and is subject to withdrawal or modification at any time by either
party.  This Lease shall become effective
and binding only if and when it shall be executed and delivered by both
Landlord and Tenant.

 

45

 

Executed
as a sealed instrument as of the 16th  day of July,
2010.

 

 

	
   

  	
  LANDLORD:

  
	
   

  	
   

  
	
   

  	
  FLANDERS 155 LLC

  
	
   

  	
   

  
	
   

  	
  By:

  	
  Carruth
  Capital, LLC

  
	
   

  	
   

  	
  Its
  Manager

  
	
   

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Christopher F. Egan

  
	
   

  	
   

  	
  Christopher
  F. Egan, President and Managing Member of Carruth Capital, LLC, not
  individually and without personal liability

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  TENANT:

  
	
   

  	
   

  
	
   

  	
  A123 SYSTEMS, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Michael Rubino

  
	
   

  	
  Printed
  Name:

  	
  Michael
  Rubino

  
	
   

  	
  Title:

  	
  Chief
  Financial Officer

  
				

 

46

 

 

FLANDERS 155 LLC

155 Flanders Road

Westborough, Massachusetts

 

EXHIBIT A

 

LEGAL DESCRIPTION

 

All
that certain parcel(s) of land situate in Westborough in the County of
Worcester and said Commonwealth of Massachusetts bounded and described as
follows:

 

Flanders
Road, Interstate Route 495 and Walkup Drive. 
All of said boundaries are determined by the Court to be located as
shown on Subdivision plan #36263-E drawn by Guerard Survey Co. &
Associates, Surveyors, dated February 5, 1980, as modified and approved by the
Court, filed in the Land Registration Office, a copy of a portion of which is
filed with Land Registration Certificate #9810. 
Being Lot 4 on said plan.

 

Said
lot is conveyed subject to the provisions and agreements as stated in Document
#36573, and to an easement relating to the placement of underground electric
and telephone wires set forth in a deed from High Voltage Engineering
Corporation to Helix Technology Corporation as stated in Document #32784.

 

For
title, see Worcester Land Court Book 65, Page 12821, Certificate of Title
#12821.

 

47

 

FLANDERS 155 LLC

155 Flanders Road

Westborough, Massachusetts

 

EXHIBIT B

 

PLAN SHOWING TENANT’S SPACE

 

48

 

FLANDERS
155 LLC

155 Flanders Road

Westborough, Massachusetts

 

EXHIBIT C

TENANT ALLOWANCE AND LANDLORD’S WORK OBLIGATIONS

 

TENANT ALLOWANCE:

 

Tenant
shall accept Premises in “AS IS” condition except Landlord shall (a) provide a
base building allowance in the amount of One Hundred Thirty-One Thousand Eight
Hundred Twenty Six Dollars and No Cents ($131,826.00) (the “Allowance”), and
(b) complete the Predelivery  Landlord’s
Work prior to the Term Commencement Date. 
The Allowance may be used throughout the Lease Term at Tenant’s
discretion and may be used by Tenant to complete certain Building repairs in
connection with damage from a previous tenant including the following: (i)
patch drywall and paint, (ii) replace ceiling tiles, (iii) replace damaged
floor tiles, (iv) pour concrete slab in chemical storage room, (v) remove and
replace the mold-affected drywall, and (vi) replace a missing cove base.  Landlord shall pay the Allowance to Tenant
within thirty (30) days after request therefor accompanied by evidence that
Tenant has incurred in connection with its preparation of the Premises costs at
least equal to the sum requested accompanied by lien waivers acceptable to
Landlord.  If Landlord fails to pay the
requested Allowance within such thirty-day period and after an additional five
(5) business days notice, Tenant shall be entitled to offset the amount of the
unpaid Allowance against Rent.

 

LANDLORD’S WORK OBLIGATIONS:

 

Pre-Delivery
Work

 

Prior
to the date hereof, Landlord, at its sole cost, has ensured that all systems
are in good working order and has performed the following environmental work
(collectively, the “Predelivery Work”):

 

I.              Microbial/Asbestos
Testing

 

1.             Visual
observation of drywall and building finishes

 

2.             Obtain eight
(8) air samples for determining non-viable mold

 

3.             Perform
moisture testing of drywall within twenty (20) rooms

 

4.             Obtain five (5)
drywall samples for lab analysis

 

5.             Obtain six (6)
air samples for asbestos sampling

 

6.             Complete a
report of findings upon receipt of lab analysis

 

49

 

II.            Environmental
Testing/Chemical Storage Room

 

1.             Remove concrete
floor at Landlord’s expense

 

2.             Obtain three
(3) sub-slab soil samples using hand auger

 

3.             Analyze samples
per Massachusetts Contingency Plan requirements (14 metals, VOC’s, EPH, VPH)

 

4.             Complete data
review and evaluation report

 

III.           Environmental
Testing/Septic System

 

1.             Install one
monitoring well (well completed by Soil Exploration Corp. while on site)

 

2.             Analyze soil
samples per Massachusetts Contingency Plan requirements (14 metals, VOC’s, EPH,
VPH)

 

3.             Obtain water
sample and analyze per Massachusetts Contingency Plan requirements (14 metals,
VOC’s, EPH, VPH)

 

4.             Complete data
review and evaluation report

 

Additional
Landlords Work: Within ninety (90) days
after notice from Tenant, Landlord, at Landlord’s sole cost, shall be
responsible for providing a fully operational 40 ton chilled water system or
removing the same as directed by Tenant (the “Additional Landlord’s Work”).

 

Bel
Power Space Environmental Work: 
Except as provided in Section 26.09(d), Landlord shall, at its sole
cost, complete environmental testing of 
the space currently leased by Bel Power, identified as REC #3, in the
Environmental Site Assessment prepared April 22, 2009, and perform all required
mitigation to achieve or confirm a level of no significant risk to human
health, safety, and the environment arising therefrom, including remediation
for fungi, mold, mildew or other microbial matter, and provide documentation of
completion of such work to Tenant within thirty (30) days after Bel Power
vacates the space (the “Bel Power Space Environmental Work”).

 

The
environmental work comprising Landlord’s Predelivery Work and Bel Power Space
Environmental Work as described  above
shall be performed by a Licensed Site Professional, as defined under 310 CMR
40.000.  Landlord shall provide Tenant
two business days advance notice before performing subsurface investigations or
any required remedial work.  Landlord
shall allow Tenant’s authorized representative to accompany Landlord or its
representative when any such work is being performed.  Landlord shall promptly deliver to Tenant a
copy of all final 

 

50

 

and
verified data, drilling logs, sampling results, reports and amounts relating to
the Predelivery Landlord’s Work and Additional Landlord’s Work required
hereunder.

 

Electrical
Upgrade: Landlord will provide an
allowance in the amount of $500,000.00 (the “Electrical Allowance”) towards
Tenant’s cost of upgrading the electrical service to the Building.  Landlord will pay the Electrical Allowance to
Tenant within thirty (30) days after request therefor accompanied by evidence
that Tenant has incurred such cost and lien waivers acceptable to
Landlord.  If Landlord fails to pay the
requested allowance within such thirty-day period and after an additional five
(5) business days’ notice stating that the unpaid Electrical Allowance amount
will be set off against Rent, Tenant shall be entitled to offset the amount of
the unpaid Electrical Allowance against Rent.

 

51

 

FLANDERS 155 LLC

155 Flanders Road

Westborough, Massachusetts

 

EXHIBIT D

 

SERVICES TO BE PROVIDED BY LANDLORD

 

(AS OPERATING EXPENSES)

 

A.            Proper care of
grounds surrounding the Building, including care of lawns and shrubs and
including removal of litter.

 

B.            Maintaining and
cleaning the sidewalks and parking areas in front of and around the Building
including snow removal.

 

C.            Provision of
adequate lighting for the parking areas servicing the Building.

 

52

 

FLANDERS 155 LLC

155 Flanders Road

Westborough, Massachusetts

 

EXHIBIT E

 

RULES AND REGULATIONS

 

1.             Heating, lighting and
plumbing: The Landlord should be notified at once of any trouble with heating,
lighting or plumbing fixtures.  Tenants
must not leave the doors of the Premises unlocked at night.

 

2.             The sidewalks, entrances,
halls and stairways shall not be obstructed by any Tenant or used for any
purposes other than  ingress and egress
to and from their respective Premises, and no articles or rubbish shall be left
therein.

 

3.             No toilet fixture shall be
used for any purpose other than that for which it is intended, and no
sweepings, rubbish, rags, ashes or other substances shall be thrown therein.

 

4.             Except as provided in
Section 26.06 of the Lease, lettering on outside windows, doors, tablets and
building directory shall be subject to the approval of the Landlord, not to be
unreasonably withheld.

 

5.             No animals or birds shall be
kept in or about the Building.

 

6.             All freight, furniture, etc.
must be received and delivered through entrances to the Building designated for
such purpose unless otherwise authorized by the Landlord.

 

7.             Nothing shall be thrown from
or taken in through the windows, nor shall anything be left outside the
Building on the window sills of the Premises.

 

8.             The Landlord, its agents and
employees shall have access upon 24 hours prior notice to Tenant to perform
their duties in the maintenance and operation of the Premises, except no prior
notice shall be required in an emergency.

 

9.             No Tenant shall use any
method of heating (including space heaters) other than that provided for in the
Tenant’s Lease without the consent of the Landlord.

 

10.           Any damage caused to the
Building or the Premises or to any person or property herein as a result of any
breach of any of the rules and regulations by the Tenant shall be borne by the
Tenant.

 

11.           Trash removal shall be
performed in accordance with Exhibit K.

 

53

 

12.           The Landlord reserves the
right to make any such other and further rules and regulations as, in its
judgment, may from time to time be necessary for maintaining the safety and
cleanliness of the Premises and Building for the preservation of good order
therein.

 

13.           Tenant shall
not permit its employees to smoke in any area in the Building or on the Land,
except smoking areas designated by Landlord.

 

54

 

FLANDERS 155 LLC

155 Flanders Road

Westborough, Massachusetts

 

EXHIBIT F

 

TENANT ESTOPPEL CERTIFICATE

 

To:          <>(“Lender”)

                <>

 

                <>

 

                Attn:  <>

 

Re:          Lease Agreement dated
                                  and
amended
                                  
(“Lease”), between FLANDERS 155 LLC, as “Landlord”, and A123 SYSTEMS, INC., as “Tenant,”
guaranteed by N/A (“Guarantor”) for leased premises known as  155 Flanders Road, Westborough, Massachusetts
01581 (the “Premises”) commonly known as 155 Flanders Road, Westborough,
Massachusetts 01581 (the Property”).

 

1.             Tenant hereby certifies that
the following representations with respect to the Lease are accurate and
complete as of the date hereof:

 

	
  a.
  

  	
  Dates
  of all amendments, letter agreements, modifications and waivers related to
  the Lease

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  b.

  	
  Commencement
  Date

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  c.

  	
  Expiration
  Date

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  d.

  	
  Current
  Annual Base Rent

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Adjustment
  Date       Rental Amount

  
	
   

  	
   

  	
   

  	
   

  
	
  e.

  	
  Fixed
  or CPI Rent Increases

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  f.

  	
  Square
  Footage of Premises

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  g.

  	
  Security
  Deposit Paid to Landlord

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  h.

  	
  Renewal
  Options

  	
   

  	
  <>
  Additional Term for <>years at
  $                      per year

  
	
   

  	
   

  	
   

  	
   

  
	
  i.

  	
  Termination
  Options

  	
   

  	
  Termination
  Date                     

  Fees Payable

  

 

55

 

2.             Tenant further certifies to
Lender that:

 

a.             the Lease is presently in
full force and effect and represents the entire agreement between Tenant and
Landlord with respect to the Premises;

 

b.             the Lease has not been
assigned and the Premises have not been sublet by Tenant except for
                      ;

 

c.             Tenant has accepted and is
occupying the Premises, all construction required by the Lease has been
completed and any payment, credits or abatements required to be given by
Landlord to Tenant have been given except for
                              ;

 

d.             no installment of rent or
other charges under the Lease other than current monthly rent has been paid
more than 30 days in advance and Tenant is not in arrears on any rental payment
or other charges;

 

e.             Landlord has no obligation
to segregate the security deposit or to pay interest thereon;

 

f.              To Tenant’s knowledge,
Landlord is not in default under the Lease and no event has occurred which,
with the giving of notice or passage of time, or both, could result in a
default by Landlord;

 

g.             To Tenant’s knowledge,
Tenant has no existing defenses, offsets, liens, claims or credits against the
payment obligations under the Lease;

 

h.             Tenant has not been granted
any options or rights to terminate the Lease earlier than the Expiration Date
except as stated in the Lease;

 

i.              Tenant has not been granted
any options or rights of first refusal to purchase the Premises or the
Property;

 

j.              Tenant has not received
notice of violation of any federal, state, county or municipal laws,
regulations, ordinances, orders or directives relating to the use or condition
of the Premises or the Property; and

 

k.             Except to the extent used in
connection with the operation of Tenant’s business in compliance with the Lease
and applicable laws, no hazardous wastes or toxic substances, as defined by all
applicable federal, state or local statutes, rules or regulations have been
disposed, stored or treated on or about the Premises or the Property by Tenant.

 

3.             This certification is made
with the knowledge that Lender is about to provide Landlord with financing
which shall be secured by a Deed of Trust (or Mortgage), Security Agreement and
Assignment of Rents, Leases and Contracts (“Mortgage”) upon the 

 

56

 

Property. 
Tenant acknowledges that Landlord’s interest in the Lease is being duly
assigned to Lender as security for Lender’s loan to Landlord.  All rent payments under the Lease shall
continue to be paid to Landlord in accordance with the terms of the Lease until
Tenant is notified otherwise in writing by Lender or its successors and
assigns. Tenant further acknowledges and agrees that Lender and Lender’s
respective successors and assigns holding the Mortgage at any time after the
date of this certificate shall have the right to rely on the information
contained in this certificate.  The
undersigned is authorized to execute this Tenant Estoppel Certificate on behalf
of Tenant.

 

	
   

  	
  TENANT

  
	
   

  	
   

  
	
   

  	
  A123
  SYSTEMS, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  
	
   

  	
  Printed
  Name:

  	
   

  
	
   

  	
   

  
	
   

  	
  Title:

  	
   

  
	
   

  	
   

  
	
   

  	
  Date:

  	
   

  
					

 

57

 

 

FLANDERS 155 LLC

155 Flanders Road

Westborough, Massachusetts

 

EXHIBIT G

 

AGREEMENT OF SUBORDINATION

NON-DISTURBANCE AND ATTORNMENT

 

THIS
AGREEMENT is dated the          day of
                                    ,
between <> (“Lender”) and A123 SYSTEMS, INC., a Delaware corporation (“Tenant”).

 

RECITALS:

 

A.            Tenant has executed that
certain lease dated
                                            
(the “Lease”) with FLANDERS 155 LLC, as Landlord (“Landlord”) covering the
premises described in the Lease (“Premises”) in that certain building located
at 155 Flanders Road, Westborough, Massachusetts 01581 (the “Property”) and
more particularly described in Exhibit A attached hereto and made a part
hereof, by this reference; and

 

B.            Lender has made or has
agreed to make a mortgage loan to Landlord secured by a mortgage or deed of
trust encumbering the Property which includes an assignment of Landlord’s
interest in the Lease (the “Mortgage”); and

 

C.            Tenant and Lender desire to
confirm their understanding with respect to the Lease and the Mortgage.

 

NOW,
THEREFORE, in consideration of the covenants, terms, conditions, agreements
contained herein, the parties hereto agree as follows:

 

1.             The Lease and any
extensions, modifications or renewals thereof, including but not limited to any
option to purchase or right of first refusal to purchase the Property or any
portion thereof, if any, is and shall continue to be subject and subordinate in
all respects to the Mortgage and the lien created thereby, and to any advancements
made thereunder and to any consolidations, extensions, modifications or
renewals thereof.

 

2.             Tenant agrees to deliver to
Lender, in the manner set forth in paragraph 7, a copy of any notice of default
sent to Landlord by Tenant.  If Landlord
fails to cure such default within the time provided in the Lease, Lender shall
have the right, but not the obligation to cure such default on behalf of
Landlord within thirty (30) calendar days after the time provided for Landlord
to cure such default in the Lease or within a reasonable period (not to exceed
sixty (60) calendar days) if such default cannot be cured within that time,
provided Lender is proceeding with due diligence to cure such default.  In such event Tenant shall not terminate the
Lease while such remedies are being diligently pursued by 

 

58

 

Lender. 
Tenant hereby agrees that no action taken by Lender to enforce any
rights under the Mortgage or related security documents, by reason of any
default thereunder (including, without limitation, the appointment of a
receiver, any action to appoint a receiver or to obtain the right to possession
of the Property by foreclosure, deed in lieu of foreclosure, or otherwise (“Foreclosure”),
or any demand for rent under any assignment of rents or leases) shall give rise
to any right of Tenant to terminate the Lease nor shall such action invalidate
or constitute a breach of any of the terms of the Lease.

 

3.             As long as no Event of
Default exists, Tenant’s possession and occupancy of the Premises shall not be
disturbed by Lender during the term of the Lease or any extension thereof and
Lender (and any purchaser at Foreclosure or subsequent transferee) shall
recognize all of Tenant’s rights under the Lease.

 

4.             If Lender succeeds to the
interest of Landlord under the Lease, subject to Tenant’s performance of its
obligations under the Lease, the Lease will continue in full force and
effect.  Thereupon, Lender shall
recognize the Lease and Tenant’s rights thereunder and Tenant shall make full
and complete attornment to Lender as substitute Landlord upon the same terms,
covenants and conditions as provided in the Lease, except for any option to
purchase or right of first refusal to purchase the Property as may be provided
in the Lease.  Further, Tenant agrees
that any such option or right of first refusal to purchase the Property or any
portion thereof, as may be provided in the Lease shall not apply to and shall
not in any way impair or delay any Foreclosure, as defined herein.

 

5.             Tenant agrees that, if
Lender or a purchaser on Foreclosure (whichever is applicable “Purchaser”)shall
succeed to the interest of Landlord under the Lease, Purchaser shall not be:

 

(a)           liable for any prior act or omission of Landlord or
any prior Landlord or consequential damages arising therefrom except that the
Purchaser shall remedy any continuing maintenance defaults of which Tenant
shall have given Lender notice of default and opportunity to cure pursuant to
Section 2 above; or

 

(b)           subject to any offsets or defenses which Tenant
might have as to Landlord or any prior Landlord except as set forth in Exhibit
C of the Lease and except to the extent the cause therefor is continuing
provided Tenant shall have given Lender notice of default and opportunity to
cure pursuant to Section 2 above; or

 

(c)           required or obligated to credit Tenant with any rent
or additional rent for any rental period beyond the then current month which
Tenant might have paid Landlord; or

 

(d)           bound by any material amendments or modifications of
the Lease such as those affecting rent, term or permitted use made without
Lender’s prior written consent; or

 

59

 

(e)           liable for refund of all or any part of any security
deposit unless such security deposit shall have been actually received by
Lender.

 

6.             The provisions of this
Agreement shall be binding upon and inure to the benefit of the parties hereto
and their respective successors and assigns. 
The words, “Lender,” “Landlord” and “Tenant” shall include their
respective heirs, legatees, executors, administrators, beneficiaries,
successors and assigns.

 

7.             All notices, and all other
communication with respect to this Agreement, shall be directed as
follows:  if to Lender,
                                                                  
(“Lender’s Address”) or such other address as Lender may designate in writing
to Tenant and, if to Tenant, at the address set forth in the Lease or at such
other address as Tenant may designate in writing to Lender.  All notices shall be in writing and shall be
(a) hand-delivered, (b) sent by United States express mail or by private
overnight courier, or (c) served by certified mail postage prepaid, return
receipt requested, to the appropriate address set forth above.  Notices served as provided in (a) and (b)
shall be deemed to be effective upon delivery. 
Any notice served by certified mail shall be deposited in the United States
mail with postage thereon fully prepaid and shall be deemed effective on the
day of actual delivery as shown by the addressee’s return receipt or the
expiration of three business days after the date of mailing, whichever is
earlier in time.

 

8.             This Agreement contains the
entire agreement between the parties and no modifications shall be binding upon
any party hereto unless set forth in a document duly executed by or on behalf
of such party.

 

9.             This Agreement may be
executed in multiple counterparts, all of which shall be deemed originals and
with the same effect as if all parties had signed the same document.  All of such counterparts shall be construed
together and shall constitute one instrument.

 

60

 

IN
WITNESS WHEREOF, the parties hereto have executed this Agreement as of the day
and year first above written.

 

	
  LENDER:

  	
   

  	
  TENANT:

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  <> 

  	
   

  	
  A123
  SYSTEMS, INC.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
  Printed
  Name:

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Its
  Authorized Signatories

  	
   

  	
  Title:

  	
   

  
							

 

61

 

FLANDERS 155 LLC

155 Flanders Road

Westborough, Massachusetts

 

EXHIBIT H

 

CERTIFICATE OF VOTE

 

A
meeting of The Board of Directors of A123 Systems, Inc., was held on May 6,
2010 at the office located at 321 Arsenal Street, Watertown, Massachusetts
02472.

 

Michael
Rubino, the Chief Financial Officer of the Corporation, presided at the meeting
and declared that a quorum of the Board of Directors was present and in
attendance.

 

Upon
motion duly made and seconded, the Board of Directors unanimously

 

VOTED:                 That Michael Rubino, Chief Financial Officer
of A123 Systems, Inc., be and is hereby authorized, in name of, and on behalf
of the said Corporation, with respect to all real estate of said Corporation
now, or at any time hereafter, leased by said Corporation, to sign, seal,
acknowledge, and bind said Corporation regarding any and all leases, releases,
notes, assignments, agreements, notices, estoppels, affidavits specifically
including property located at 155 Flanders Road, Westborough, Massachusetts,
and all such instruments as he may by his execution thereof approve, said
authority to remain in full force and effect until notice of revocation thereof
shall be recorded in each Registry of Deeds wherein this Vote shall be
recorded.

 

	
  A TRUE COPY:

  	
   

  
	
   

  	
  Eric
  J. Pyenson, Assistant  Secretary

  

 

ATTEST:

 

I,
Eric J. Pyenson, Assistant Secretary, hereby certify that I am the duly elected
and qualified Assistant Secretary for the above named Corporation and that the
above is a true copy of the Vote that was passed, and that Michael Rubino is
the duly elected and qualified Chief Financial Officer of the Corporation.

 

	
  ATTEST:

  	
   

  
	
   

  	
  Eric J. Pyenson,
  Assistant Secretary

  

 

62

 

FLANDERS 155 LLC

155 Flanders Road

Westborough, Massachusetts

 

EXHIBIT I

 

PARKING

 

Tenant,
upon the commencement of its occupancy of the Premises, shall have the right to
use for its designated employees, as appurtenant to the Premises no more than
one hundred ninety four (194) unassigned parking spaces in the Building’s
parking areas (reduced by the number of spaces which Tenant shall utilize
pursuant to the last paragraph hereof). Tenant shall use the parking areas
solely for parking registered passenger vehicles.  Storage trailers, storage containers, busses,
motor homes, trucks and like vehicles are not permitted, except for such
vehicles or containers as specifically approved by Landlord in writing from
time to time, such approval not to be unreasonably withheld, and in compliance
with the provisions of this Lease Landlord shall in no event be required to
enforce such rights on Tenant’s behalf. 
Use of such spaces may not be sold, assigned, licensed or otherwise
given to any person for any compensation or fee or otherwise.  The use of such parking spaces by Tenant may
be regulated by reasonable rules and regulations issued by the Landlord from
time to time.  Landlord reserves the
right, after reasonable written notice to Tenant, at any time and from time to
time to change the location of any parking space or spaces designated for
Tenant’s use pursuant to this Exhibit I provided there is no material adverse
effect on Tenant’s use and enjoyment of the Premises or parking areas.

 

Subject
to the compliance with all applicable Legal Requirements and Landlord’s
reasonable approval, Tenant shall have the right to install outdoor electrical
power  in order to provide electric /
hybrid vehicle recharging stations as the locations depicted on the attached
plan.

 

Notwithstanding
anything to the contrary contained herein, Landlord hereby approves the locations
of the electric vehicle, customer, and ADA parking spaces show on the plan
attached hereto as Schedule I-1.

 

63

 

FLANDERS 155 LLC

155 Flanders Road

Westborough, Massachusetts

 

EXHIBIT J

 

TRASH REMOVAL

 

Tenant,
at its expense, shall contract with a trash hauling service to provide a
covered trash container (“Dumpster”) and trash removal services, subject to the
following paragraph of this Exhibit J. 
The contractor and the dumpster shall be subject to Landlord’s approval,
such approval not to be unreasonably withheld. 
Tenant shall comply with all rules and regulations related to trash
storage and removal promulgated by Landlord from time to time.  The dumpster shall be placed in a location
designated by Landlord, which designation may be changed by Landlord from time
to time.  The dumpster shall be in good
condition, freshly painted with working covers and doors, and shall be clearly
marked with the name of the hauling company and its telephone number.  The dumpster shall not be overfilled and
shall remain closed at all times.  No
trash shall be placed outside the dumpster. 
Paper, packaging materials and small items shall be placed in trash bags
to prevent spillage when the container is open or emptied.  The dumpster shall be emptied on a frequency
determined by Landlord from time to time to be appropriate for Tenant’s
activities.

 

Notwithstanding
anything to the contrary contained herein, Landlord hereby agrees that Tenant
shall be permitted to operate a trash compactor in lieu of contracting with a
trash hauling service to provide a Dumpster set forth in the foregoing
paragraph.

 

In
the event Tenant shall fail to comply with any of its obligations under this
Exhibit J or the rules and regulations referred to herein, without limiting any
of Landlord’s other rights or remedies under this Lease, Landlord may, without
notice to Tenant, cure Tenant’s default hereunder and charge Tenant for
Landlord’s cost of performing the same as Additional Rent.  Such cost shall be paid by Tenant to Landlord
immediately upon billing therefor.

 

64

 

FLANDERS 155 LLC

155 Flanders Road

Westborough, Massachusetts

 

EXHIBIT K

 

TENANT IMPROVEMENT PLANS

 

65

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