EX-10.28 2 b37716atex10-28.txt EX-10.28 LEASE DATED 11/28/00 1 Exhibit 10.28 EXHIBIT 1, SHEET 1 Building No. 600 TECHNOLOGY SQUARE Cambridge, Massachusetts 02139 LEASE DATA Execution Date: NOVEMBER 28, 2000 Tenant: AKAMAI TECHNOLOGIES, INC. a Delaware corporation Mailing Address: Akamai Technologies, Inc. 500 Technology Square Cambridge, Massachusetts 02139-3539 Landlord: TECHNOLOGY SQUARE LLC, a Delaware limited liability company (the sole manager of which is Beacon Capital Partners L.P., a Delaware limited partnership d/b/a Beacon Capital Partners Limited Partnership; the sole general partner of which is Beacon Capital Partners, Inc., a Maryland corporation) Mailing Address: c/o Beacon Capital Partners, One Federal Street, Boston, Massachusetts 02110, Attention: General Counsel Complex: The land, buildings and other improvements thereon, from time to time, located off Main Street in the City of Cambridge, Middlesex County, Commonwealth of Massachusetts known as Technology Square. The Complex is initially substantially as shown on Exhibit 6, Sheet 1, and the legal description of the Complex is set forth on Exhibit 6, Sheets 2, 3, and 4; however, the Complex may change from time to time as set forth herein. Without limiting the foregoing, the parties acknowledge that the Complex presently consists of Buildings 200, 400 and 500. The parties anticipate that Building 300 will be added to the Complex in May 2001; Building 600 will be added to the Complex on or before the Full Rent Commencement Date and Building 700 will be added to the Complex one month after Building 600. There is no current estimate of when Building 100 will be added to the Complex. Building: 600 Technology Square, Cambridge, Massachusetts Premises: A PORTION OF THE FIRST (1ST) AND THE ENTIRETY OF THE SECOND (2ND), THIRD (3RD), FOURTH (4TH) AND FIFTH (5TH) FLOORS OF THE BUILDING, SUBSTANTIALLY AS SHOWN ON LEASE PLAN, EXHIBIT 2, SHEETS 1, 2, 3, 4 AND 5. Art. 3.1 Specified Commencement Date: May 1, 2001 2 EXHIBIT 1, SHEET 2 Building No. 600 TECHNOLOGY SQUARE Cambridge, Massachusetts 02139 Tenant: AKAMAI TECHNOLOGIES, INC. Execution Date: NOVEMBER 28, 2000 Term Commencement Date: Substantial Completion Date Estimated Full Rent Commencement Date: October 1, 2001 Art. 3.2 Termination Date: TWELVE (12) YEARS AFTER THE FULL RENT COMMENCEMENT DATE Art. 4.3 Landlord's Construction Representative: Greg Walsh Tenant's Construction Representative: Skip Hartwell Art. 5 Use of Premises: GENERAL BUSINESS OFFICE USE Art. 6 Yearly Rent: RENT YEAR YEARLY RENT MONTHLY PAYMENT 1 - 6:(1) $6,818,760.00 $568,230.00 7-12: $7,386,990.00 $615,582.50 Art. 7 Total Rentable Area of the Premises: 113,646 square feet Total Rentable Area of the Building: 127,150 square feet Total Rentable Non-Retail Area of the Building 113,646 square feet Initial Total Rentable Area of the Complex: Buildings 200, 400 and 500 532,279 square feet Building 300 175,226 square feet Building 600 127,150 square feet ---------------------------- (1) For the purposes of this Lease, "Rent Year 1" shall be defined as the twelve-(12)-month period commencing as of the Rent Commencement Date and ending on the last day of the month in which the first (1st) anniversary of the Rent Commencement Date occurs. Thereafter, "Rent Year" shall be defined as any twelve (12) month period during the term of the Lease commencing as of the first (1st) day of the month following the month in which any anniversary of the Rent Commencement Date occurs. -2- 3 EXHIBIT 1, SHEET 3 Building No. 600 TECHNOLOGY SQUARE Cambridge, Massachusetts 02139 Tenant: AKAMAI TECHNOLOGIES, INC. Execution Date: NOVEMBER 28, 2000 Building 700 49,508 square feet Art. 8 Electricity: Electric current will be metered and paid for by Tenant in accordance with Article 8.1 of the Lease. Art. 9 Operating and Tax Escalation: Operating Cost Base: $681,876.00 (i.e. $6.00 per square foot of Total Rentable Area of the Non-Retail Area of the Building) Tax Base: $397,761.00 (i.e. $3.50 per square foot of the Total Rentable Area of the Premises) Tenant's Building Operating Cost Percentage: 100% Tenant's Building Tax Percentage: 89.38% Tenant's Complex Tax Percentage: The Total Rentable Area of the Premises divided by the Total Rentable Area of the Complex, as the same may change from time to time. Art. 29.3 Co-Brokers: INSIGNIA/ESG AND SPAULDING & SLYE Art. 29.5 Arbitration: SUPERIOR COURT; MIDDLESEX COUNTY Exhibit Date: LEASE PLAN, EXHIBIT 2, SHEETS 1, 2, 3, 4 AND 5 DATED NOVEMBER 28, 2000 -3- 4 EXHIBIT 1, SHEET 4 Building No. 600 TECHNOLOGY SQUARE Cambridge, Massachusetts 02139 Tenant: AKAMAI TECHNOLOGIES, INC. Execution Date: NOVEMBER 28, 2000 LANDLORD: TENANT: TECHNOLOGY SQUARE LLC, AKAMAI TECHNOLOGIES, INC. a Delaware limited liability company a Delaware corporation By: Beacon Capital Partners L.P., a Delaware limited partnership d/b/a Beacon Capital Partners Limited Partnership, its manager By: Beacon Capital Partners, Inc., a Maryland corporation, its general partner By: /s/ Thomas Ragno By: /s/ Kathryn L. Jorden ----------------------- ---------------------------- Name: Thomas Ragno Name: /s/ Kathryn L. Jorden -------------------------- Title: Senior Vice President Title: VP, General Counsel ------------------------- Date Signed: 12/05/00 Date Signed: 12/05/00 ---------------------- ------------------- -4- 5 TABLE OF CONTENTS 1. REFERENCE DATA 1 2. DESCRIPTION OF DEMISED PREMISES 1 2.1 DEMISED PREMISES............................................1 2.2 APPURTENANT RIGHTS..........................................1 2.3 PARKING.....................................................1 2.4 EXCLUSIONS AND RESERVATIONS.................................2 3. TERM OF LEASE 2 3.1 DEFINITIONS.................................................2 3.2 HABENDUM....................................................3 3.3 DECLARATION FIXING TERM COMMENCEMENT DATE...................3 4. CONSTRUCTION 3 4.0 LANDLORD'S WORK.............................................3 4.1 TENANT'S REMEDIES BASED ON DELAYS IN LANDLORD'S WORK........9 4.2 TENANT'S WORK..............................................11 4.3 QUALITY AND PERFORMANCE OF WORK............................13 5. USE OF PREMISES 13 5.1 PERMITTED USE..............................................13 5.2 PROHIBITED USES............................................14 5.3 LICENSES AND PERMITS.......................................14 6. RENT AND SPECIAL ALLOWANCE 14 6.1. RENT.......................................................14 6.2 LANDLORD'S CONTRIBUTION....................................15 7. RENTABLE AREA 17 8. SERVICES FURNISHED BY LANDLORD 17 8.1 ELECTRIC CURRENT...........................................17 8.2 WATER......................................................18 8.3 ELEVATORS, HEAT, CLEANING..................................18 8.4 AIR CONDITIONING...........................................19 8.5 ADDITIONAL HEAT, CLEANING AND AIR CONDITIONING SERVICES....19 8.6 ADDITIONAL AIR CONDITIONING EQUIPMENT......................19 8.7 REPAIRS....................................................20 8.8 INTERRUPTION OF CURTAILMENT OF SERVICES....................20 -i- 6 8.9 ENERGY CONSERVATION........................................21 8.10 MISCELLANEOUS..............................................21 9. ESCALATION 21 9.1 DEFINITIONS................................................21 9.2 TAX EXCESS.................................................29 9.3 OPERATING EXPENSE EXCESS...................................30 9.4 PART YEARS.................................................30 9.5 EFFECT OF TAKING...........................................30 9.6 ADJUSTMENT OF OPERATING COSTS BASED UPON OCCUPANCY.........31 9.7 EFFECT OF CONVERSION OF COMPLEX TO A CONDOMINIUM...........31 9.8 DISPUTES, ETC..............................................31 9.9 TENANT'S AUDIT RIGHTS......................................31 10. CHANGES OR ALTERATIONS BY LANDLORD 35 11. FIXTURES, EQUIPMENT AND IMPROVEMENTS--REMOVAL BY TENANT 35 12. ALTERATIONS AND IMPROVEMENTS BY TENANT 36 13. TENANT'S CONTRACTORS--MECHANICS' AND OTHER LIENS-- STANDARD OF TENANT'S PERFORMANCE--COMPLIANCE WITH LAWS 37 14. REPAIRS BY TENANT--FLOOR LOAD 39 14.1 REPAIRS BY TENANT..........................................39 14.2 FLOOR LOAD--HEAVY MACHINERY................................39 15. INSURANCE, INDEMNIFICATION, EXONERATION AND EXCULPATION 39 15.1 GENERAL LIABILITY INSURANCE................................39 15.2 CERTIFICATES OF INSURANCE..................................40 15.3 GENERAL....................................................40 15.4 PROPERTY OF TENANT.........................................41 15.5 BURSTING OF PIPES, ETC.....................................41 15.6 REPAIRS AND ALTERATIONS--NO DIMINUTION OF RENTAL VALUE.....42 16. ASSIGNMENT, MORTGAGING AND SUBLETTING 42 17. MISCELLANEOUS COVENANTS 46 17.1 RULES AND REGULATIONS......................................46 17.2 ACCESS TO PREMISES--SHORING................................47 17.3 ACCIDENTS TO SANITARY AND OTHER SYSTEMS....................47 -ii- 7 17.4 SIGNS, BLINDS AND DRAPES...................................48 17.5 ESTOPPEL CERTIFICATE.......................................49 17.6 PROHIBITED MATERIALS AND PROPERTY..........................49 17.7 REQUIREMENTS OF LAW--FINES AND PENALTIES...................49 17.8 TENANT'S ACTS--EFFECT ON INSURANCE.........................50 17.9 MISCELLANEOUS..............................................50 18. DAMAGE BY FIRE, ETC. 50 19. WAIVER OF SUBROGATION 53 20. CONDEMNATION - EMINENT DOMAIN 53 21. DEFAULT 55 21.1 CONDITIONS OF LIMITATION - RE-ENTRY - TERMINATION..........55 21.2 INTENTIONALLY OMITTED......................................56 21.3 DAMAGES - TERMINATION......................................56 21.4 FEES AND EXPENSES..........................................57 21.5 WAIVER OF REDEMPTION.......................................57 21.6 LANDLORD'S REMEDIES NOT EXCLUSIVE..........................58 21.7 GRACE PERIOD...............................................58 22. END OF TERM - ABANDONED PROPERTY 58 23. SUBORDINATION 59 24. QUIET ENJOYMENT 61 25. ENTIRE AGREEMENT -- WAIVER -- SURRENDER 62 25.1 ENTIRE AGREEMENT...........................................62 25.2 WAIVER.....................................................62 25.3 SURRENDER..................................................62 26. INABILITY TO PERFORM - EXCULPATORY CLAUSE 63 27. BILLS AND NOTICES 63 28. PARTIES BOUND -- SEIZIN OF TITLE 64 -iii- 8 29. MISCELLANEOUS 64 29.1 SEPARABILITY...............................................64 29.2 CAPTIONS, ETC..............................................64 29.3 BROKER.....................................................65 29.4 MODIFICATIONS..............................................65 29.5 ARBITRATION................................................65 29.6 GOVERNING LAW..............................................66 29.7 ASSIGNMENT OF RENTS........................................66 29.8 REPRESENTATION OF AUTHORITY................................66 29.9 EXPENSES INCURRED BY LANDLORD UPON TENANT REQUESTS.........66 29.10 RETAIL AREA................................................67 29.11 SURVIVAL...................................................67 EXHIBIT 2 Lease Plan 69 EXHIBIT 2-1 Plan of Complex 70 EXHIBIT 3 Requirements for Tenant's Plans 71 EXHIBIT 4 Building Services 72 EXHIBIT 5 Form of Letter of Credit 75 EXHIBIT 6 Base Building Specifications 77 EXHIBIT 7 Exterior Signage 78 EXHIBIT 8 Tenant's Removable Property 79 RIDER TO LEASE 80 -iv- 9 THIS INDENTURE OF LEASE made and entered into on the Execution Date as stated in Exhibit 1 and between the Landlord and the Tenant named in Exhibit 1. Landlord does hereby demise and lease to Tenant, and Tenant does hereby hire and take from Landlord, the Premises hereinafter mentioned and described (hereinafter referred to as "Premises"), upon and subject to the covenants, agreements, terms, provisions and conditions of this Lease for the term hereinafter stated: 1. REFERENCE DATA Each reference in this Lease to any of the terms and titles contained in any Exhibit attached to this Lease shall be deemed and construed to incorporate the data stated under that term or title in such Exhibit. 2. DESCRIPTION OF DEMISED PREMISES 2.1 DEMISED PREMISES. The Premises are that portion of the Building as described in Exhibit 1 and is hereinafter referred to as "Building", substantially as shown hatched or outlined on the Lease Plan (Exhibit 2) hereto attached and incorporated by reference as a part hereof. 2.2 APPURTENANT RIGHTS. Tenant shall have, as appurtenant to the Premises, rights to use in common, with others entitled thereto, subject to reasonable rules from time to time made by Landlord of which Tenant is given notice; (a) the common lobbies, hallways, stairways and elevators of the Building, serving the Premises in common with others, (b) common walkways necessary for access to the Building, and (c) if the Premises include less than the entire rentable area of any floor, the common toilets and other common facilities of such floor; and no other appurtenant rights or easements. Landlord shall allow Tenant's telecommunication service provider to have access to the Building and to Tenant's Premises, provided however, that Landlord shall have the right to charge Tenant's provider fees in connection with the services being performed by such provider. Notwithstanding the foregoing, so long as Tenant's telecommunications service provider ("Provider") does not provide telecommunications service to any other tenant of the Building, Landlord shall not require such Provider to pay any fees for such access. 2.3 PARKING. During the term of the Lease, commencing on the Rent Commencement Date (and, if there is more than one Rent Commencement Date pursuant to Article 3.1 hereof commencing on a pro rata basis with each such Rent Commencement Date), the Landlord will make available, at Tenant's written request, which request must be made on or before the Full Rent Commencement Date, up to one and one-half (1.5) monthly parking passes per 1,000 square feet of Total Rentable Area leased by Tenant (the "Parking Space Cap") for use in the garage of the Complex or surface parking areas in the Building, as the same may change from time to time ("Parking Areas"). If Tenant fails timely to make such request for any such parking passes, Tenant shall have no right to obtain such parking passes under this Article 2.3, except to the extent thereafter available, as more specifically set forth herein. If Tenant requests fewer passes than the Parking Space Cap prior to the Full Rent Commencement Date, Tenant shall have the right, from time to time during the term of the Lease, to request additional parking passes up to the Parking Space Cap. If Landlord has such passes available, Landlord will provide the same to Tenant (but in no event more than the Parking Space Cap), provided -1- 10 however, that, if such passes are not available, Landlord shall have no obligation to provide additional passes to Tenant. Tenant shall have no right to sublet, assign, or otherwise transfer said parking passes, other than to an Assignee or a Qualified Transferee pursuant to an approved assignment or sublease under Article 16 of the Lease. Said parking passes shall be paid for by Tenant at the then current prevailing rate in the Parking Areas, as such rate may vary from time to time. If, for any reason, Tenant shall fail timely to pay the charge for said parking passes, and if such default continues for ten (10) days after written notice, Tenant shall have no further right to the parking passes for which Tenant failed to pay the charge under this Article 2.3. Said parking passes will be on an unassigned, non-reserved basis, and shall be subject to such reasonable and uniform rules and regulations as may be in effect for the use of said Parking Areas (including, without limitation, Landlord's right, without additional charge to Tenant above the prevailing rate for parking passes, to institute a valet or attendant-managed parking system), from time to time in force. 2.4 EXCLUSIONS AND RESERVATIONS. All the perimeter walls of the Premises except the inner surfaces thereof, any balconies (except to the extent same are shown as part of the Premises on the Lease Plan (Exhibit 2)), terraces or roofs adjacent to the Premises, and any space in or adjacent to the Premises used for shafts, stacks, pipes, conduits, wires and appurtenant fixtures, fan rooms, ducts, electric or other utilities, sinks or other Building facilities, and the use thereof, as well as the right of access through the Premises for the purposes of operation, maintenance, decoration and repair, are expressly excluded from the Premises and reserved to Landlord. 3. TERM OF LEASE. 3.1 DEFINITIONS. As used in this Lease the words and terms which follow mean and include the following: (a) "SPECIFIED COMMENCEMENT DATE" - The "Specified Commencement Date" is the date (as stated in Exhibit 1) on which it is estimated that Landlord's Work Necessary to Trigger Term Commencement Date will be substantially completed. (b) "TERM COMMENCEMENT DATE" - The "Term Commencement Date" is the date on which the First Substantial Completion Date, as defined in Article 4.0(b), occurs. (c) "RENT COMMENCEMENT DATE" - Subject to the provisions of this Article 3.1(c), the "Rent Commencement Date" is the earlier of (i) the Outside Rent Commencement Date, as defined in Article 3.1(d), or (ii) the date Tenant takes possession of the whole of the Premises for use and operation of Tenant's business as set forth in Exhibit 1. If Tenant takes earlier possession of any portion of any floor on which the Premises are located prior to the Outside Rent Commencement Date for use as set forth in Exhibit 1, then the Rent Commencement Date for the entirety of the portion of the Premises located on such floor shall occur as of the date that Tenant first takes such possession. As used herein, the term "FULL RENT COMMENCEMENT DATE" shall mean the date on which the Rent Commencement Date has occurred for the entirety of the Premises. (d) "OUTSIDE RENT COMMENCEMENT DATE" - Subject to the provisions of this Article 3.1(d), the "Outside Rent Commencement Date" shall be later of: (i) one hundred fifty (150) days after the Term Commencement Date, or (ii) one hundred twenty (120) days after -2- 11 the Third and Fourth Floor Substantial Completion Date, as hereinafter defined, or (iii) ninety (90) days after the First and Second Floor Substantial Completion Date, as hereinafter defined, or (iv) sixty (60) days after the Permanent Power Turn-On Date, as hereinafter defined, or (v) the Base Building Substantial Completion Date, as hereinafter defined, or (vi) five (5) days after the HVAC Operational Date, as hereinafter defined. Notwithstanding the foregoing, if Tenant does not, in fact, substantially complete Tenant's Work prior to the Outside Rent Commencement Date, as determined pursuant to the first sentence of this Article 3.1(d), and if any Landlord Delays occur, then the Outside Rent Commencement Date shall be extended by the number of days that any Landlord Delay actually delays the substantial completion of Tenant's Work beyond the Outside Rent Commencement Date, as determined pursuant to the first sentence of this Article 3.1(d). 3.2 HABENDUM. TO HAVE AND TO HOLD the Premises for a term of years commencing on the Term Commencement Date and ending on the Termination Date as stated in Exhibit 1 or on such earlier date upon which said term may expire or be terminated pursuant to any of the conditions of limitation or other provisions of this Lease or pursuant to law (which date for the termination of the terms hereof will hereafter be called "Termination Date"). Notwithstanding the foregoing, if the Termination Date as stated in Exhibit 1 shall fall on other than the last day of a calendar month, said Termination Date shall be deemed to be the last day of the calendar month in which said Termination Date occurs. 3.3 DECLARATION FIXING TERM COMMENCEMENT DATE, RENT COMMENCEMENT DATE, AND TERMINATION DATE. As soon as may be after the execution date hereof, each of the parties hereto agrees, upon demand of the other party to join in the execution, in recordable form, of a statutory notice, memorandum, etc. of lease and/or written declaration in which shall be stated the Term Commencement Date, the Rent Commencement Date(s), and (if need be) the Termination Date. If this Lease is terminated before the term expires, then upon Landlord's request the parties shall execute, deliver and record an instrument acknowledging such fact and the date of termination of this Lease, and Tenant hereby appoints Landlord its attorney-in-fact in its name and behalf to execute such instrument if Tenant shall fail to execute and deliver such instrument after Landlord's request therefor within ten (10) days. 4. CONSTRUCTION 4.0 LANDLORD'S WORK. (a) Landlord, at Landlord's sole cost and expense, shall perform the base building work ("LANDLORD'S WORK") as defined in the Base Building Specifications attached hereto as Exhibit 6. Landlord shall not make any material change in the Base Building Specifications without obtaining the prior written approval of Tenant (which approval shall not be unreasonably withheld, conditioned, or delayed). Without limiting the foregoing, Landlord shall not make any material changes in the finishes of the lobby of the Building without obtaining the prior written approval of Tenant (which approval shall not be unreasonably withheld, conditioned, or delayed). Notwithstanding the foregoing, Tenant hereby agrees that: (i) with respect to the glasswall finish adjacent to the retail areas in the lobby, Landlord may use an alternate wall finish in lieu of the materials specified in the Base Building Specifications (which alternate finish shall be at least equal in quality to the finishes contained in the lobby at 500 Technology Square as of the date hereof) and Landlord shall perform, as part of the Landlord's Work, whatever sprinkler work is required by applicable codes in connection with such wall finish, and -3- 12 (ii) with respect to the lobby walls, Landlord may use an alternate finish in lieu of the finish specified in the Base Building Specifications, provided that such alternate finish is at least equal in quality to the finishes contained in the lobby at 500 Technology Square as of the date hereof. Subject to delays due to governmental regulation, unusual scarcity of or inability to obtain labor or materials, labor difficulties, casualty or other causes reasonably beyond Landlord's control (collectively "Landlord's Force Majeure"), Landlord shall use reasonable speed and diligence in the construction of Landlord Work Necessary to Trigger Term Commencement Date (as defined in Article 4.0(g) below) so as to have the same substantially completed on or before the Specified Commencement Date set forth in Exhibit 1, but Tenant shall have no claim against Landlord for failure to complete construction of Landlord's Work, except as expressly set forth in Article 4.1. In each such instance of Landlord's Force Majeure, Landlord shall exercise reasonable diligence to eliminate the cause of such inability to perform. (b) The "FIRST SUBSTANTIAL COMPLETION DATE" shall be defined as the date on which the Landlord's Work Necessary to Trigger Term Commencement Date, as defined in Article 4.0(g), has been substantially completed, so that any remaining Landlord's Work can be performed with a minimum of interference or delay in the progress of Tenant's Work on the fifth floor, Tenant acknowledging, however, the priority of Landlord's Work, as set forth in Article 4.2(c). (c) The "THIRD AND FOURTH FLOOR SUBSTANTIAL COMPLETION DATE" shall be defined as the date on which Landlord's Work Necessary to Trigger Third and Fourth Floor Substantial Completion Date, as defined in Article 4.0(h), has been substantially completed, so that any remaining Landlord's Work can be performed with a minimum of interference or delay in the progress of Tenant's Work on the third and fourth floors, Tenant acknowledging, however, the priority of Landlord's Work, as set forth in Article 4.2(c). Notwithstanding the foregoing, in the event of any Tenant Delays which actually delay the performance of Landlord's Work Necessary to Trigger Third and Fourth Floor Substantial Completion Date, the Third and Fourth Floor Substantial Completion Date shall be defined as the date on which Landlord's Work Necessary to Trigger Third and Fourth Floor Substantial Completion Date would have been substantially completed but for such Tenant Delays. (d) The "FIRST AND SECOND FLOOR SUBSTANTIAL COMPLETION DATE" shall be defined as the date on which Landlord's Work Necessary to Trigger First and Second Floor Substantial Completion Date, as defined in Article 4.0(i), has been substantially completed, so that any remaining Landlord's Work can be performed with a minimum of interference or delay in the progress of Tenant's Work on the first and second floors, Tenant acknowledging, however, the priority of Landlord's Work, as set forth in Article 4.2(c). Notwithstanding the foregoing, in the event of any Tenant Delays which actually delay the performance of Landlord's Work Necessary to Trigger First and Second Floor Substantial Completion Date, the First and Second Floor Substantial Completion Date shall be defined as the date on which Landlord's Work Necessary to Trigger First and Second Floor Substantial Completion Date would have been substantially completed but for such Tenant Delays. (e) The "PERMANENT POWER TURN-ON DATE" shall be defined as the date on which Landlord has made permanent electric power and the base building heating and air conditioning system operational for the entire Premises, except that in the event of any Tenant Delays which actually delay Landlord's ability to achieve the Permanent Power Turn-On Date, the Permanent Power Turn-On Date shall be defined as the date on which Landlord would have been able to -4- 13 make permanent electric power and the base building heating and air conditioning system operational for the entire Premises but for such Tenant Delays. (f) The "BASE BUILDING SUBSTANTIAL COMPLETION DATE" shall be defined as the date on which Landlord's Work Necessary to Trigger Rent Commencement Date, as defined in Article 4.0(j), has been substantially completed, except that in the event of any Tenant Delays which actually delay the performance of Landlord's Work Necessary to Trigger Rent Commencement Date, the Base Building Substantial Completion Date shall be defined as the date on which Landlord's Work Necessary to Trigger Rent Commencement Date would have been substantially completed but for such Tenant Delays. (g) The "LANDLORD WORK NECESSARY TO TRIGGER TERM COMMENCEMENT DATE" shall be defined as the following items of work: i.) Site utilities serving the Building; ii.) Foundation piles, grade beams, and structural slab on grade; iii.) Under slab drainage and utilities; iv.) Structural steel erected and set; v.) Composite concrete decks; vi.) Spray fireproofing; vii.) Precast concrete Building exterior panels; viii.) The fifth floor is Building Tight, as defined in Article 4.0(k), and ix.) Any other portions of Landlord's Work necessary to enable Tenant and its contractor to commence the Tenant's Work (as defined in Article 4.2) on the fifth floor. (h) The "LANDLORD WORK NECESSARY TO TRIGGER THIRD AND FOURTH FLOOR SUBSTANTIAL COMPLETION DATE" shall be defined as the following items of work: i.) The Landlord Work Necessary to Trigger Term Commencement Date; ii) Both the third and fourth floors are Building Tight, as defined in Article 4.0(k); and iii) Any other portions of Landlord's Work necessary to enable Tenant and its contractor to commence the Tenant's Work on both the third and fourth floors. (i) The "LANDLORD WORK NECESSARY TO TRIGGER FIRST AND SECOND FLOOR SUBSTANTIAL COMPLETION DATE" shall be defined as the following items of work: i.) The Landlord Work Necessary to Trigger Term Commencement Date; ii.) The Landlord Work Necessary to Trigger Third and Fourth Floor Substantial Completion Date; iii.) Both the first and second floors are Building Tight, as defined in Article 4.0(k); and iv.) Any other portions of Landlord's Work necessary to enable Tenant and its contractor to commence the Tenant's Work on -5- 14 the second floor and in the portion of the first floor in which the Premises are located. (j) The Landlord Work necessary to trigger the "BASE BUILDING SUBSTANTIAL COMPLETION DATE" shall be defined as the following items of work: i.) The Landlord Work Necessary to Trigger Term Commencement Date; ii.) The Landlord Work Necessary to Trigger Third and Fourth Floor Substantial Completion Date; iii.) The Landlord Work Necessary to Trigger First and Second Floor Substantial Completion Date; iv.) The following items of Landlord's Work, to the extent not included in clauses (i), (ii), and (iii) of this Article 4.0(j): (a) Curtainwall; (b) Roofing; (c) Windows; (d) Elevators; (e) Mechanical, Electrical & Plumbing Systems for Building Core & Shell; (f) Building Cores including bathroom, mechanical, electrical, and telephone/data rooms; (g) Building Lobby and Lobby interior finishes to the extent which would be necessary to satisfy the Certificate of Occupancy Test, as defined in Article 4.0(l); (h) Mechanical/Electrical & Plumbing finishes; (i) Base Building Fire Alarm Panels & Life Safety Systems; (j) Exterior walkways at least five (5) feet wide and sufficient to permit access to and egress from the Premises and adjacent public streets and parking areas, as well as around the perimeter of the Building; and (k) All elements of Landlord's Work necessary to satisfy the Certificate of Occupancy Test, as further defined in Article 4.0(l). Any portion of Landlord's Work which is not completed on or before the Base Building Substantial Completion Date which affects a particular portion of the Premises, or the access thereto, shall be completed within thirty (30) days after a Certificate of Occupancy has been issued for such portion of the Premises, except for (x) items of Landlord Work which are not complete due to delays caused by weather (for those items which are weather-sensitive), and (y) items of Landlord Work which are not complete due to delays caused by long lead time items and causes beyond Landlord's reasonable control (provided, however, that items of Landlord Work which are not complete due to delays caused by long lead time items and causes beyond Landlord's reasonable control shall in any event be completed within ninety (90) days after the issuance of the Certificate of Occupancy for the portion of the Premises in question). Without limiting the foregoing, the final balancing of mechanical systems need not be completed as of the Rent Commencement Date, however, the air handling units serving the Premises shall be -6- 15 operational (the date such units are made operational being herein referred to as the "HVAC Operational Date"). (k) BUILDING TIGHT. Any floor shall be deemed to be "Building Tight" if all of the following have been achieved: i.) The roof of the Building has been installed and is weather-tight; ii.) The windows on such floor have been installed and are weather-tight; iii.) The precast concrete on such floor has been installed and is weather-tight; iv.) All core walls facing the tenanted areas of such floor have been substantially completed; v.) The perimeter wall of the Building on such floor has been installed, is weather tight and has interior drywall ready for finish treatment; vi.) Temporary power is available to Tenant on such floor; vii.) All base building mechanical systems which are to be provided to such floor have been stubbed to such floor. (l) CERTIFICATE OF OCCUPANCY TEST. i.) As a Condition to the Base Building Substantial Completion Date. Reference is made to clauses (g) and (j) of Article 4.0(j)(iv), which provide that, as a condition to achieving the Base Building Substantial Completion Date, Landlord's Work must have been completed to the extent necessary to enable Tenant to obtain a Certificate of Occupancy for the Premises (hereinafter referred to as the "Certificate of Occupancy Test"). Landlord shall apply to the Building Inspector of the City of Cambridge ("Building Inspector") for a Certificate of Occupancy with respect to Landlord's Work ("Base Building") in order to assist the parties in determining whether the Base Building Substantial Completion Date has occurred. If the Building Inspector issues a Base Building Certificate of Occupancy, the Certificate of Occupancy Test shall be conclusively deemed to have been satisfied. The parties acknowledge that: (a) if Tenant's Work has not progressed to the point where Tenant is able to apply for a Certificate of Occupancy with respect to at least a portion of the Premises, the Building Inspector may not be willing to perform such inspection, (b) given that Tenant's Work includes a portion of the sprinkler system, the Building Inspector may not be able to issue a Base Building Certificate of Occupancy if Tenant's Work is not complete, and (c) other incomplete portions of Tenant's Work may prevent Landlord from obtaining a Base Building Certificate of Occupancy. If the Building Inspector is willing to perform such inspection and if the Building Inspector denies the issuance of the Base Building Certificate of Occupancy based solely on deficiencies identified by the Building Inspector in Landlord's Work, then the Certificate of Occupancy Test shall not be deemed satisfied until Landlord corrects such deficiencies to the satisfaction of the Building Inspector. If, despite Landlord's application for a Base Building Certificate of Occupancy, the Building Inspector does not perform such inspection, or if the Building Inspector performs such inspection, but does not identify any deficiencies in Landlord's Work and does not issue a Base Building Certificate of Occupancy, then the Certificate of Occupancy Test may still be satisfied as follows: Landlord shall notify Tenant when it believes that all of Landlord's Work necessary for Tenant to obtain a Certificate of Occupancy has been substantially completed ("Landlord's Completion Notice"). If Tenant disputes Landlord's assertion of substantial -7- 16 completion, it shall so notify Landlord within ten (10) days after receipt of Landlord's Completion Notice, whereupon such dispute shall be immediately submitted to arbitration in accordance with the provisions of Article 29.5. The parties hereby acknowledge that Tenant, and not Landlord, is responsible for all items of Tenant's Work which must be completed in order to enable Tenant to obtain a Certificate of Occupancy for the Premises and in no event shall Landlord be deemed to have failed to satisfy the Certificate of Occupancy Test based upon any deficiency or lack of completion of Tenant's Work. ii.) Tenant's Inability to Obtain a Certificate of Occupancy after the Occurrence of the Base Building Substantial Completion Date. If the Base Building Substantial Completion Date (i.e. and the Rent Commencement Date) occurs prior to the issuance of a Certificate of Occupancy with respect to any portion of the Premises, and if, subsequently Tenant is denied a Certificate of Occupancy with respect to any portion of the Premises, solely by reason of any deficiency in Landlord's Work, then: (x) Landlord shall, as promptly as possible, remedy such deficiency so as to remove such impediment to Tenant's obtaining such Certificate of Occupancy, and (y) Tenant's obligation to pay Yearly Rent and other charges due under the Lease in respect of the portion of the Premises which Tenant is unable to occupy because it cannot obtain such Certificate of Occupancy shall be fully abated during the period of time commencing as of the date that Tenant is denied such Certificate of Occupancy until Landlord cures such deficiency in Landlord's Work so that it is no longer prevents Tenant from obtaining such Certificate of Occupancy. (m) TENANT DELAY. A "Tenant Delay" shall be defined as any act or omission by Tenant, or any agent, employee, consultant, contractor, or subcontractor of Tenant, which causes an actual delay in the performance of Landlord's Work Necessary to Trigger Full Rent Commencement Date. Notwithstanding the foregoing, no event shall be deemed to be a Tenant Delay until and unless Landlord has given Tenant written notice ("Tenant Delay Notice") advising Tenant: (i) that a Tenant Delay is occurring, (ii) of the basis on which Landlord has determined that a Tenant Delay is occurring, and (iii) the actions which Landlord believes that Tenant must take to eliminate such Tenant Delay. No period of time prior to the time that Tenant receives a Tenant Delay Notice shall be included in the period of time charged to Tenant pursuant to such Tenant Delay Notice. (n) LANDLORD DELAY. A "Landlord Delay" shall be defined as any act or omission by Landlord or any agent, employee, consultant, contractor or subcontractor of Landlord which: (i) is not a result of the priority granted to Landlord's Work as set forth in Article 4.2(c) hereof, and (ii) causes an actual delay in the performance of Tenant's Work. Notwithstanding the foregoing, except as set forth in Article 4.2(e), no event shall be deemed to be a Landlord Delay until and unless Tenant has given Landlord written notice ("Landlord Delay Notice") advising Landlord: (i) that a Landlord Delay is occurring, (ii) of the basis on which Tenant has determined that a Landlord Delay is occurring, and (iii) the actions which Tenant believes that Landlord must take to eliminate such Landlord Delay. No period of time prior to the time that Landlord receives a Landlord Delay Notice shall be included in the period of time charged to Landlord pursuant to such Landlord Delay Notice. (o) LANDLORD'S WARRANTY; SATISFACTION OF LANDLORD'S OBLIGATIONS UNDER ARTICLE 4. -8- 17 i.) Landlord's Warranty. Landlord warrants to Tenant that: (x) materials and equipment furnished in the performance of Landlord's Work will be of good quality and new unless otherwise required or permitted by the Base Building Specifications, (y) Landlord's Work will be free from defects not inherent in the quality required or permitted under the Base Building Specifications, and (z) Landlord's Work will conform the requirements of the Base Building Specifications. Any portion of Landlord's Work not conforming to the requirements of this clause (i), including substitutions not properly approved and authorized, may be considered defective. Landlord's warranty excludes remedy for damage or defect caused by abuse, modifications not executed by Landlord, improper or insufficient maintenance (other than by Landlord, where Landlord is required to perform maintenance on the item or system in question), improper operation (other than by Landlord, where Landlord operates the item or system in question), or normal wear and tear and normal usage. ii.) Warranty Period. Landlord shall be deemed to have satisfied all of its obligations under this Article 4 (including, without limitation, Landlord's warranty obligations under this Article 4.0(o) and under Article 4.3) except to the extent that, on or before the Warranty Expiration Date, as hereinafter defined, Tenant gives written notice to Landlord in accordance with the provisions of Article 27 setting forth with specificity the manner in which Tenant believes that Landlord has failed to comply with its obligations under this Article 4. The "Warranty Expiration Date" shall be defined as the date three hundred fifty-eight (358) days after the Full Rent Commencement Date. iii.) Repair of Defective Work. Landlord agrees that it shall, without cost to Tenant, correct any portion of Landlord's Work which is found not to be in accordance with the requirements of the warranties set forth in this Article 4.0(o) and in Article 4.3, unless Tenant has previously given Landlord a written acceptance of such condition, provided that: Tenant gives Landlord written notice of such condition in accordance with the provisions of Article 27 promptly after it becomes aware of such condition, and in any event on or before the Warranty Expiration Date. The provisions of this Article 4.0(o) shall not relieve Landlord of any obligation which Landlord has to make repairs or to perform maintenance pursuant to Article 8 of the Lease. (p) Any dispute between the parties with respect to the provisions of this Article 4 shall be submitted to arbitration in accordance with Article 29.5. 4.1 TENANT'S REMEDIES BASED ON DELAYS IN LANDLORD'S WORK. (a) If the Term Commencement Date shall not have occurred on or before October 1, 2001 ("INITIAL OUTSIDE COMPLETION DATE") (which date shall be extended for up to ninety (90) days on account of any Force Majeure Delays, as hereinafter defined), Tenant shall have the right to terminate this Lease by giving notice to Landlord of Tenant's desire to do so before such completion and within the time period from the Initial Outside Completion Date (as so extended) until the date which is thirty (30) days subsequent to the Initial Outside Completion Date (as so extended); and, upon the giving of such notice, the Term of this Lease shall cease and come to an end without further liability or obligation on the part of either party unless, within thirty (30) days after receipt of such notice, the Term Commencement Date occurs. If Tenant terminates the Lease pursuant to this Paragraph (a), Landlord shall return to Tenant any Letter of Credit given by Tenant to Landlord within fifteen (15) business days after Landlord's receipt written request for such return from Tenant, and Landlord shall reimburse Tenant an amount equal to the -9- 18 lesser of: (x) Five Hundred Sixty-Eight Thousand Two Hundred Thirty ($568,230.00) Dollars, or (y) the actual cost incurred by Tenant through the Effective Termination Date in preparing the plans and specifications for Tenant's Work. Landlord shall make such payment to Tenant within thirty (30) days after Tenant delivers to Landlord evidence reasonably satisfactory to Landlord of the amount such costs. Landlord shall have the right to audit Tenant's books and records with respect to Tenant's costs. (b) If the Base Building Substantial Completion Date does not occur on or before March 1, 2002 ("INTERIM OUTSIDE COMPLETION DATE") (which date shall be extended (i) for the period of any Tenant Delays, and (ii) for up to ninety (90) days on account of any Force Majeure Delays), Tenant shall have the right to terminate this Lease by giving notice to Landlord of Tenant's desire to do so before such completion and within the time period from the Interim Outside Completion Date (as so extended) until the date which is thirty (30) days subsequent to the Interim Outside Completion Date (as so extended); and, upon the giving of such notice ("Effective Termination Date"), the Term of this Lease shall cease and come to an end without further liability or obligation on the part of either party unless the Base Building Substantial Completion Date occurs on or before the date thirty (30) days after receipt of such notice (as so extended). If Tenant has occupied part of the Premises for the Permitted Use prior to such termination, then the Effective Termination Date with respect to the part of the Premises so occupied shall be ninety (90) days subsequent to the Interim Outside Completion Date (as so extended). If Tenant terminates the Lease pursuant to this Paragraph (b), Landlord shall return to Tenant any Letter of Credit given by Tenant to Landlord within fifteen (15) business days after Landlord's receipt written request for such return from Tenant, and Landlord shall reimburse Tenant an amount equal to the actual cost incurred by Tenant through the Effective Termination Date in performing and designing the Tenant's Work to the extent that such amount exceeds any portion of Landlord's Contribution theretofore paid to or for the account of Tenant. Landlord shall make such payment to Tenant within thirty (30) days after Tenant delivers to Landlord evidence reasonably satisfactory to Landlord of the amount such costs. Landlord shall have the right to audit Tenant's books and records with respect to Tenant's costs. (c) If the Base Building Substantial Completion Date does not occur on or before June 1, 2002 ("FINAL OUTSIDE COMPLETION DATE") (which date shall be extended for the period of any Tenant Delays), Tenant shall have the right to terminate this Lease by giving notice to Landlord of Tenant's desire to do so before such completion and within the time period from the Final Outside Completion Date until the date which is thirty (30) days subsequent to the Final Outside Completion Date; and, upon the giving of such notice ("Effective Termination Date"), the Term of this Lease shall cease and come to an end without further liability or obligation on the part of either party unless the Base Building Substantial Completion Date occurs on or before the date thirty (30) days after receipt of such notice. If Tenant has occupied part of the Premises for the Permitted Use prior to such termination, then the Effective Termination Date with respect to the part of the Premises so occupied shall be ninety (90) days subsequent to the Final Outside Completion Date. If Tenant terminates the Lease pursuant to this Paragraph (c), Landlord shall return to Tenant any Letter of Credit given by Tenant to Landlord within fifteen (15) business days after Landlord's receipt written request for such return from Tenant, and Landlord shall reimburse Tenant an amount equal to the actual cost incurred by Tenant through the Effective Termination Date in performing and designing the Tenant's Work to the extent that such amount exceeds any portion of Landlord's Contribution theretofore paid to or for the account of Tenant. Landlord shall make such payment to Tenant within thirty (30) days after Tenant delivers to -10- 19 Landlord evidence reasonably satisfactory to Landlord of the amount such costs. Landlord shall have the right to audit Tenant's books and records with respect to Tenant's costs. (d) FORCE MAJEURE DELAYS. For the purposes of this Article 4.1, "Force Majeure Delays" shall be defined as any delays in the performance of Landlord's Work to the extent arising from causes beyond Landlord's reasonable control other than Tenant Delays, provided however, that no delay shall be deemed to be a Force Majeure Delay unless Landlord advises Tenant in writing of such delay on or before the date thirty (30) days after Landlord first becomes aware of such delay. (e) RENT CREDIT. If the Full Rent Commencement Date has not occurred for all or a portion of the Premises on or before the Liquidated Damage Date, as hereinafter defined, then with respect to those portion(s) of the Premises with respect to which the Rent Commencement Date has not occurred, Tenant shall be entitled to a credit against the Yearly Rent on a day-for-day basis for the lesser of (i) the number of days from the Liquidated Damage Date to but not including the Rent Commencement Date with respect to such portion(s) of the Premises, and (ii) one hundred eighty (180) days. The "Liquidated Damage Date" shall be defined as December 1, 2001. (f) The remedies set forth in this Article 4.1 are Tenant's sole and exclusive rights and remedies based upon any delay in the performance of Landlord's Work. If Tenant terminates this Lease pursuant to this Article 4.1, then the Third Amendment to the Building 500 Lease (as defined in Article 21.1 hereof) shall also thereby be automatically terminated and of no further force and effect. 4.2 TENANT'S WORK. (a) Tenant shall, on or before the Outside Tenant Work Commencement Date, commence the performance of the work ("Tenant's Work") necessary to prepare the Premises for Tenant's occupancy, and Tenant shall thereafter diligently prosecute the Tenant's Work to completion. The "OUTSIDE TENANT WORK COMMENCEMENT DATE" shall be defined as the date nine (9) months after the Term Commencement Date, provided that if Tenant is delayed in the commencement of Tenant's Work by reason of causes beyond Tenant's reasonable control, the Outside Tenant Work Commencement Date shall be extended by the lesser of: (i) the period of time which Tenant is so delayed, or (ii) three (3) additional months (i.e. in no event shall the Outside Tenant Work Commencement Date occur later than the date one (1) year after the Term Commencement Date). (b) Tenant shall substantially complete Tenant's Work on or before the Outside Tenant Work Completion Date. The "OUTSIDE TENANT WORK COMPLETION DATE" shall be defined as the date fifteen (15) months after the Full Rent Commencement Date, provided that if Tenant is delayed in the performance of Tenant's Work by reason of causes beyond Tenant's reasonable control, the Outside Tenant Work Completion Date shall be extended by the lesser of: (i) the period of time which Tenant is so delayed, or (ii) three (3) additional months (i.e. in no event shall the Outside Tenant Work Completion Date occur later than the date eighteen (18) months after the Full Rent Commencement Date). (c) COST OF TENANT'S WORK; PRIORITY OF WORK. Except for Landlord's Contribution, as set forth in Article 6.2, all of the Tenant's Work shall be performed at Tenant's -11- 20 sole cost and expense, and shall be performed in accordance with the provisions of this Lease (including, without limitation, Articles 11 and 12). Tenant and Landlord shall each take necessary reasonable measures to the end that Tenant's contractors and Landlord's contractors shall cooperate in all ways with Landlord's contractors to avoid any delay in either Landlord's Work or Tenant's Work or any conflict with the performance of either Landlord's Work or Tenant's Work, Tenant acknowledging, however, that in the case of conflict that is not reasonably avoidable, the performance of Landlord's Work shall have priority. Tenant shall pay to Landlord, as additional rent, within ten (10) days of billing therefor, charges (which shall be reasonably based on Tenant's usage) for the use of elevators and/or hoisting in connection with the performance of Tenant's Work. Tenant shall have access to the Premises and the Building on a 24-hour a day, 365-day a year basis in order to perform Tenant's Work. Landlord and Tenant recognize that to the extent Tenant elects to perform some or all of Tenant's Work during times other than normal construction hours, Landlord will need to make arrangements to have supervisory personnel on site. Accordingly, Landlord and Tenant agree as follows: Tenant shall give Landlord at least five (5) days' written notice of any time outside of normal construction hours (i.e., Monday-Friday, 7 a.m. to 3 p.m., excluding holidays) when Tenant intends to perform portions of Tenant's Work (the "After Hours Work"). Landlord shall pay the cost of the first one hundred hours, in the aggregate, of Landlord's supervisory personnel overseeing the After Hours Work. Tenant shall reimburse Landlord, within thirty (30) days after demand therefor, for the cost of all additional hours of Landlord's supervisory personnel overseeing the After Hours Work. Landlord shall notify Tenant of the after hours hourly rates (which shall be normal and customary) for such supervisory personnel from time to time upon written request. (d) TENANT'S PLANS. In connection with the performance of Tenant's Work, Tenant shall submit to Landlord for Landlord's reasonable approval an initial set of plans ("Initial Plans"), progress plans from time to time ("Interim Plans") and a full set of construction drawings ("Final Plans") for Tenant's Work (collectively "the Plans"). The Final Plans shall contain at least the information required by, and shall conform to the requirements of, Exhibit 3. Landlord's approval of the Initial Plans and the Interim Plans (and the Final Plans, provided that the Final Plans are consistent with the Initial Plans and the Interim Plans and contain at least the information required by, and conform to the requirements of, said Exhibit 3), shall not be unreasonably withheld, conditioned or delayed and shall comply with the requirements to avoid aesthetic or other conflicts with the design and function of the balance of the Building. Landlord's approval is solely given for the benefit of Landlord under this Article 4.2 and neither Tenant nor any third party shall have the right to rely upon Landlord's approval of Tenant's Plans for any other purpose whatsoever. Without limiting the foregoing, Tenant shall be responsible for all elements of the design of Tenant's plans (including, without limitation, compliance with law, functionality of design, the structural integrity of the design, the configuration of the Premises and the placement of Tenant's furniture, appliances and equipment), and Landlord's approval of Tenant's Plans shall in no event relieve Tenant of the responsibility for such design. (e) TIME PERIODS FOR LANDLORD'S RESPONSE TO TENANT'S PLANS. Landlord agrees to respond to any Initial Plans within ten (10) days of receipt thereof and to Interim Plans and the Final Plans within fifteen (15) days of receipt thereof. If Landlord has not responded to any submission of Tenant's Plans within the ten (10) or fifteen (15) day, as applicable, time period set forth above, then Tenant may send Landlord a notice of such failure to respond, which notice ("Second Notice") shall contain the following language in bold face and all capital letters: "SECOND NOTICE. FAILURE TO RESPOND TO THIS NOTICE WITHIN FIVE (5) -12- 21 DAYS SHALL CONSTITUTE A LANDLORD DELAY UNDER THE LEASE, WHICH MAY ENTITLE TENANT TO A RENT ABATEMENT." If Landlord does not respond to the submission of Tenant's Plans within five (5) days after receipt of the Second Notice, then each additional day after five (5) days before Landlord responds to such submission shall constitute a Landlord Delay. (f) TENANT'S HOIST. Subject to Landlord's prior written approval of Tenant's plans and specifications therefor (which approval shall not be unreasonably withheld, conditioned, or delayed), Tenant shall have the right, during the performance of Tenant's Work, to install a hoist at the Building in order to enable Tenant's contractor to perform Tenant's Work. Tenant shall maintain such hoist in good condition and in a manner which does not interfere with the performance of Landlord's Work. The initial location of such hoist shall be as reasonably approved by Tenant, recognizing the priority given to Landlord's Work in Article 4.2(c) hereof. Once such hoist is installed, Tenant shall not be required to relocate such hoist, except that Tenant shall remove such hoist from the Building at the time that Landlord makes available to Tenant an elevator for Tenant's exclusive use. Tenant shall repair any damage to the Building caused by the installation or removal of such hoist. (g) GAS LINE. Subject to (i) Landlord's prior written approval of Tenant's plans and specifications therefor (which approval shall not be unreasonably withheld, conditioned, or delayed), and (ii) Tenant having obtained all necessary governmental approvals therefor, Landlord shall bring natural gas to the perimeter of the Building at Landlord's expense and Tenant shall have the right to tie into the same at its expense for the purpose of serving Tenant's back-up generator. 4.3 QUALITY AND PERFORMANCE OF WORK. All construction work required or permitted by this Lease (whether constituting part of Landlord's Work or Tenant's Work) shall be done in a good and workmanlike manner and in compliance with all applicable laws, ordinances, rules, regulations, statutes, by-laws, court decisions, and orders and requirements of all public authorities ("Legal Requirements") and all insurance requirements of this Lease. All of Tenant's Work shall be coordinated with any work being performed by, or for, Landlord, and in such manner as to maintain harmonious labor relations. Each party authorizes the other to rely in connection with design and construction upon the written approval or other written authorizations on the party's behalf by any Construction Representative of the party designated by the party. Each party's initial Construction Representative is designated on Exhibit 1. 5. USE OF PREMISES 5.1 PERMITTED USE. Tenant shall continuously during the term hereof occupy and use the Premises only for the purposes as stated in Exhibit 1 and for no other purposes. Service and utility areas (whether or not a part of the Premises) shall be used only for the particular purpose for which they were designed. Without limiting the generality of the foregoing, Tenant agrees that it shall not use the Premises or any part thereof, or permit the Premises or any part thereof to be used for the preparation or dispensing of food, whether by vending machines or otherwise. Notwithstanding the foregoing, but subject to the other terms and provisions of this Lease, Tenant may, with Landlord's prior written consent, which consent shall not be unreasonably withheld, install at its own cost and expense so-called hot-cold water fountains, coffee makers and refrigerator-sink-stove combinations for the preparation of beverages and foods, provided that no cooking, frying, etc., are carried on in the Premises to such extent as -13- 22 requires special exhaust venting, Tenant hereby acknowledging that the Building is not engineered to provide any such special venting. Landlord hereby agrees that any equipment shown on Tenant's final approved plans and equivalent equipment in substitution of such equipment shall not, if maintained in good operating order, be deemed to violate the provisions of this Article 5.1. 5.2 PROHIBITED USES. Notwithstanding any other provision of this Lease, Tenant shall not use, or suffer or permit the use or occupancy of, or suffer or permit anything to be done in or anything to be brought into or kept in or about the Premises or the Building or any part thereof (including, without limitation, any materials appliances or equipment used in the construction or other preparation of the Premises and furniture and carpeting): (i) which would violate any of the covenants, agreements, terms, provisions and conditions of this Lease or otherwise applicable to or binding upon the Premises; (ii) for any unlawful purposes or in any unlawful manner; (iii) which, in the reasonable judgment of Landlord shall in any way (a) impair the appearance or reputation of the Building; or (b) impair, interfere with or otherwise diminish the quality of any of the Building services or the proper and economic heating, cleaning, ventilating, air conditioning or other servicing of the Building; or Premises, or with the use or occupancy of any of the other areas of the Building, or occasion discomfort, inconvenience or annoyance, or injury or damage to any occupants of the Premises or other tenants or occupants of the Building; or (iv) which is inconsistent with the maintenance of the Building as an office building of the first class in the quality of its maintenance, use, or occupancy. Tenant shall not install or use any electrical or other equipment of any kind which, in the reasonable judgment of Landlord, might cause any such impairment, interference, discomfort, inconvenience, annoyance or injury. 5.3 LICENSES AND PERMITS. If any governmental license or permit shall be required for the proper and lawful conduct of Tenant's business, and if the failure to secure such license or permit would in any way affect Landlord, the Premises, the Building or Tenant's ability to perform any of its obligations under this Lease, Tenant, at Tenant's expense, shall duly procure and thereafter maintain such license and submit the same to inspection by Landlord. Tenant, at Tenant's expense, shall at all times comply with the terms and conditions of each such license or permit. Tenant shall furnish all data and information to governmental authorities and Landlord as required in accordance with legal, regulatory, licensing or other similar requirements as they relate to Tenant's use or occupancy of the Premises or the Building. 6. RENT AND SPECIAL ALLOWANCE 6.1. RENT. (a) During the term of this Lease the Yearly Rent and other charges, at the rate stated in Exhibit 1, shall be payable by Tenant to Landlord by monthly payments, as stated in Exhibit 1, in advance and without demand on the first day of each month for and in respect of such month. The rent and other charges reserved and covenanted to be paid under this Lease in respect of the Premises shall commence on the Rent Commencement Date. If, by reason of any provisions of this Lease, the rent reserved hereunder shall commence or terminate on any day other than the first day of a calendar month, the rent for such calendar month shall be prorated. The rent shall be payable to Landlord or, if Landlord shall so direct in writing, to Landlord's agent or nominee, in lawful money of the United States which shall be legal tender for payment of all debts and dues, public and private, at the time of payment, at the office of the Landlord or -14- 23 such place as Landlord may designate, and the rent and other charges in all circumstances shall be payable without any setoff or deduction whatsoever. Rental and any other sums due hereunder not paid on or before the date which is five (5) business days after the date due shall bear interest for each month or fraction thereof from the due date until paid computed at the annual rate of three percentage points over the so-called prime rate then currently from time to time charged to its most favored corporate customers by the largest national bank (N.A.) located in the city in which the Building is located ("National Bank"), or at any applicable lesser maximum legally permissible rate for debts of this nature. In lieu of requiring Tenant to pay monthly installments of Yearly Rent and other fixed monthly charges in the manner described above, Tenant shall have the right to pay such amounts by means of an automated debit system (the "Automatic Debit System") whereby any or all such payments shall be debited from Tenant's account in a bank or financial institution designated by Tenant and credited to Landlord's account in a bank or financial institution designated by Landlord. In the event Tenant elects to pay monthly installments of Yearly Rent and other fixed monthly charges by means of the Automatic Debit System, Tenant, within thirty (30) days after written request by Landlord, shall execute and deliver to Landlord any authorizations, certificates or other documentation as may be required to establish and give effect to the Automatic Debit System. Either party shall have the right to change its bank or financial institution from time to time, provided that Tenant, no less than thirty (30) days prior to the effective date of any such change, shall provide Landlord with written notice of such change and any and all authorizations, certificates or other documentation as may be required to establish and give effect to the Automatic Debit System at Tenant's new bank or financial institution if Tenant elects to continue to use such Automatic Debit System. Tenant shall promptly pay all service fees and other charges imposed upon Tenant in connection with the Automatic Debit System, and Tenant shall promptly reimburse Landlord for any charges resulting from insufficient funds in Tenant's bank account (provided however, that Tenant shall have the right to discontinue the use of the Automatic Debit System at any time upon at least thirty (30) days' prior written notice to Landlord). In the event that any Yearly Rent or other fixed monthly charges are not paid on time as a result of insufficient funds in Tenant's account, Tenant shall be liable for any interest in accordance with this Article. Tenant shall remain liable to Landlord for all payments of Rent due hereunder regardless of whether Tenant's account is incorrectly debited in any given month, it being agreed that a debit of less than the full amount due shall not be construed as a waiver by Landlord of its right to receive any unpaid balance. (b) Rentable Area. Landlord and Tenant acknowledge the Total Rentable Area of the Premises, the Building and of the other buildings initially in the Complex have been determined by agreement, and that the figures set forth in Exhibit 1 shall be conclusive and binding on Landlord and Tenant with regard to the Complex. In the event that Landlord alters any of the buildings in, or adds other buildings to, the Complex, the Total Rentable Area of any such buildings shall be included in the Total Rentable Area of the Complex when first occupied. 6.2 LANDLORD'S CONTRIBUTION. (a) As an inducement to Tenant's entering into this Lease, Landlord shall provide to Tenant a special allowance equal to up to Thirty and 00/100 Dollars ($30.00) per square foot of Rentable Floor Area of the Premises initially demised to Tenant (i.e. Three Million Four Hundred Nine Thousand Three Hundred Eighty and 00/100 Dollars ($3,409,380.00)) ("Landlord's Contribution") to be used by Tenant to pay for the cost of the Tenant's Work. For -15- 24 the purposes hereof, the cost to be so reimbursed by Landlord shall include the cost of leasehold improvements but not the cost of any of Tenant's personal property, trade fixtures or trade equipment or any so-called soft costs. Furthermore, in the event that Tenant does not build out all of the Premises, Landlord's Contribution shall be limited to a maximum of Thirty and 00/100 Dollars ($30.00) per square foot of Rentable Floor Area of the Premises actually built out by Tenant (the "Finished Area"). (b) Landlord shall pay Landlord's Proportion (as hereinafter defined) of the cost shown on each requisition (as hereinafter defined) submitted by Tenant to Landlord within twenty (20) days of submission thereof by Tenant to Landlord until the entirety of Landlord's Contribution has been exhausted. For purposes hereof, "Landlord's Proportion" shall be a fraction, the numerator of which is Landlord's Contribution and the denominator of which is the total contract price for Tenant's Work, and a "requisition" shall mean written documentation (including, without limitation, invoices from Tenant's contractors, vendors, service providers and consultants, lien waivers, and such other documentation as Landlord or Landlord's mortgagee may reasonably request) showing in reasonable detail the costs of the item in question or of the improvements installed to date in the Premises, accompanied by certifications from Tenant that the amount of the requisition in question does not exceed the cost of the items, services and work covered by such requisition. Each requisition shall be accompanied by evidence reasonably satisfactory to Landlord that items, services and work covered by such requisition has been fully paid by Tenant and that the work has been performed. Landlord shall have the right, upon reasonable advance notice to Tenant, to inspect Tenant's books and records relating to each requisition in order to verify the amount thereof. Tenant shall submit requisition(s) no more often than monthly. (c) Notwithstanding anything to the contrary herein contained: (i) Landlord shall have no obligation to advance funds on account of Landlord's Contribution unless and until Landlord has received the requisition in question. (ii) Except with respect to work and/or materials previously paid for by Tenant, as evidenced by paid invoices and written lien waivers provided to Landlord, Landlord shall have the right to have Landlord's Contribution paid to directly to Tenant's contractor(s), consultants, service providers, and vendor(s). In no event shall Landlord's Contribution be applied to any fees paid to Tenant or any affiliate of Tenant. (iii) Landlord shall have no obligation to pay any portion of Landlord's Contribution in respect of any requisition submitted after the date ("Outside Requisition Date") which is the earlier of: (a) three (3) months after the completion of Tenant's Work, or (b) twenty-one (21) months after the Full Rent Commencement Date (provided, however, that if Tenant certifies to Landlord that it is engaged in a good faith dispute with its contractor, such Outside Requisition Date shall be extended while such dispute is ongoing, so long as Tenant is diligently prosecuting the resolution of such dispute). Tenant shall not be entitled to receive any portion of Landlord's Contribution except to the extent -16- 25 that it has submitted requisitions and/or made demand therefor, on or before the Outside Requisition Date. (iv) Tenant shall not be entitled to any unused portion of Landlord's Contribution. (v) Landlord's obligation to pay any portion of Landlord's Contribution shall be conditioned upon there existing no default beyond the expiration of any applicable grace periods by Tenant in its obligations under the Lease at the time that Landlord would otherwise be required to make such payment. 7. RENTABLE AREA Total Rentable Area of the Premises, the Building and the Complex have, as of the Execution Date, been agreed to be the amounts set forth on Exhibit 1. 8. SERVICES FURNISHED BY LANDLORD 8.1 ELECTRIC CURRENT. (a) As stated in Exhibit 1, Landlord will require Tenant to contract directly with the company supplying electric current for the purchase and obtaining by Tenant of electric current directly from such company to be billed directly to, and paid for by, Tenant. Tenant shall have the right to choose among companies supplying electric current to the Premises if there is more than one such company available. Tenant acknowledges that such electric current purchased directly by Tenant shall include the current used to operate the HVAC equipment serving the Premises. (b) Landlord shall (i) permit its risers, conduits and feeders to the extent available, suitable and safely capable, to be used for the purpose of enabling Tenant to purchase and obtain electric current directly from such company, (ii) without cost or charge to Tenant, make such alterations and additions to the electrical equipment and/or appliances in the Building as such company shall specify for the purpose of enabling Tenant to purchase and obtain electric current directly from such company, and (iii) at Landlord's expense, furnish and install in or near the Premises any necessary metering equipment used in connection with measuring Tenant's consumption of electric current and Tenant, at Tenant's expense, shall maintain and keep in repair such metering equipment. (c) If Tenant shall require electric current for use in the Premises in excess of the capacity available at the commencement of the term of this Lease and if (i) in Landlord's reasonable judgment, Landlord's facilities are inadequate for such excess requirements or (ii) such excess use shall result in an additional burden on the Building air conditioning system and additional cost to Landlord on account thereof then, as the case may be, (x) Landlord upon written request and at the sole cost and expense of Tenant, will furnish and install such additional wire, conduits, feeders, switchboards and appurtenances as reasonably may be required to supply such additional requirements of Tenant if current therefor be available to Landlord, provided that the same shall be permitted by applicable laws and insurance regulations and shall not cause damage to the Building or the Premises or cause or create a dangerous or hazardous condition or -17- 26 entail excessive or unreasonable alterations or repairs or interfere with or disturb other tenants or occupants of the Building or (y) Tenant shall reimburse Landlord for such additional cost, as aforesaid. (e) Landlord, at Tenant's expense and upon Tenant's request, shall purchase and install all replacement lamps of types generally commercially available (including, but not limited to, incandescent and fluorescent) used in the Premises. (f) Subject to Article 8.8(b), Landlord shall not in any way be liable or responsible to Tenant for any loss, damage or expense which Tenant may sustain or incur if the quantity, character, or supply of electrical energy is changed or is no longer available or suitable for Tenant's requirements. (g) Tenant agrees that it will not make any material alteration or material addition to the electrical equipment and/or appliances in the Premises without the prior written consent of Landlord in each instance first obtained, which consent will not be unreasonably withheld, and will promptly advise Landlord of any other alteration or addition to such electrical equipment and/or appliances. 8.2 WATER. Landlord shall furnish hot and cold water for ordinary premises cleaning, toilet, lavatory and drinking purposes. If Tenant requires, uses or consumes water for any purpose other than for the aforementioned purposes, Landlord may (i) assess a reasonable charge for the additional water so used or consumed by Tenant or (ii) install a water meter and thereby measure Tenant's water consumption for all purposes. In the latter event, Landlord shall pay the cost of the meter and the cost of installation thereof and shall keep said meter and installation equipment in good working order and repair. Tenant agrees to pay for water consumed, as shown on said meter, together with the sewer charge based on said meter charges, as and when bills are rendered, and on default in making such payment Landlord may pay such charges and collect the same from Tenant, but only to the extent that the charges shown on the meter exceed the consumption reasonably expected for ordinary premises cleaning, toilet, lavatory and drinking purposes. All piping and other equipment and facilities for use of water outside the building core will be installed and maintained by Landlord at Tenant's sole cost and expense. 8.3 ELEVATORS, HEAT, CLEANING. (a) Landlord at its expense shall: (i) provide necessary elevator facilities (which may be manually or automatically operated, either or both, as Landlord may from time to time elect) on Mondays through Fridays, excepting legal holidays, from 8:00 a.m. to 6:00 p.m. and on Saturdays, excepting legal holidays, from 8:00 a.m. to 1:00 p.m. (called "business days") and have one elevator in operation available for Tenant's use, non-exclusively, together with others having business in the Building, at all other times; (ii) furnish heat (substantially equivalent to that being furnished in comparably aged similarly equipped office buildings in the same city) to the Premises during the normal heating season on business days; and (iii) cause the office areas and the network operations center of the Premises to be cleaned on business days (except on Saturdays) provided the same are kept in order by Tenant. Either Exhibit 4 (if annexed hereto) or, otherwise, the cleaning standards generally prevailing in first-class office buildings in the city or town where the Building is located, shall represent substantially the extent and scope of the cleaning by Landlord referred to in this Article 8.3. -18- 27 (b) The parties agree and acknowledge that, despite reasonable precautions in selecting cleaning and maintenance contractors and personnel, any property or equipment in the Premises of a delicate, fragile or vulnerable nature may nevertheless be damaged in the course of cleaning and maintenance services being performed. Accordingly, Tenant shall take reasonable protective precautions with such property and equipment (including, without limitation, computers or other data processing components or equipment and optical or electronic equipment, etc.), e.g., housing the property and equipment in a separate, locked room, so as to render it inaccessible to the Building's cleaning personnel. 8.4 AIR CONDITIONING. Landlord shall through the air conditioning equipment of the Building furnish to and distribute in the Premises air conditioning as normal seasonal changes may require on business days during the hours as aforesaid in Article 8.3 when air conditioning may reasonably be required for the comfortable occupancy of the Premises by Tenant. Tenant agrees to use reasonable efforts to lower and close the blinds or drapes when necessary because of the sun's position, whenever the air conditioning system is in operation, and to cooperate fully with Landlord with regard to, and to abide by all the reasonable regulations and requirements which Landlord may prescribe for the proper functioning and protection of the air conditioning system. The air conditioning system referred to in this Article 8.4 shall be capable of maintaining the following: the air conditioning system referred to in this Article 8.4 shall be capable of providing 75(Degree)F dry bulb and 55% of relative humidity with outside conditions of 91(Degree)F dry bulb and 73(Degree)F wet bulb. 8.5 ADDITIONAL HEAT, CLEANING AND AIR CONDITIONING SERVICES. (a) Landlord will use reasonable efforts upon reasonable advance written notice from Tenant of its requirements in that regard, to furnish additional heat, cleaning or air conditioning services to the Premises on days and at times other than as above provided. (b) There shall be no charge for additional heat or air conditioning, as Tenant pays the cost of electricity therefor directly pursuant to Article 8.1. Tenant will pay to Landlord a reasonable charge (i) for any such additional cleaning service required by Tenant, (ii) for any extra cleaning of the Premises required because of the carelessness or indifference of Tenant or because of the nature of Tenant's business, and (iii) for any cleaning done at the request of Tenant of any portions of the Premises which may be used for storage, shipping room or other non-office purposes. If the cost to Landlord for cleaning the Premises shall be increased due to the installation in the Premises, at Tenant's request, of any materials or finish other than those which are building standard, Tenant shall pay to Landlord an amount equal to such increase in cost. 8.6 ADDITIONAL AIR CONDITIONING EQUIPMENT. In the event Tenant requires additional air conditioning for business machines, meeting rooms or other special purposes, or because of occupancy or excess electrical loads, any additional air conditioning units, chillers, condensers, compressors, ducts, piping and other equipment, such additional air conditioning equipment will be installed and maintained by Landlord at Tenant's sole cost and expense, but only if, in Landlord's reasonable judgment, the same will not cause damage or injury to the Building or create a dangerous or hazardous condition or entail excessive or unreasonable alterations, repairs or expense or interfere with or disturb other tenants; and Tenant shall -19- 28 reimburse Landlord in such an amount as will compensate it for the cost incurred by it in operating such additional air conditioning equipment. 8.7 REPAIRS. Except as otherwise provided in Articles 18 and 20, and subject to Tenant's obligations in Article 14, Landlord shall keep and maintain the roof, exterior walls, structural floor slabs, columns, elevators, public stairways and corridors, lavatories, equipment (including, without limitation, sanitary, electrical, heating, air conditioning, or other systems) and other common facilities of the Building in good condition and repair. 8.8 INTERRUPTION OR CURTAILMENT OF SERVICES. (a) When necessary by reason of accident or emergency, or for repairs, alterations, replacements or improvements which in the reasonable judgment of Landlord are desirable or necessary to be made, or of difficulty or inability in securing supplies or labor, or of strikes, or of any other cause beyond the reasonable control of Landlord, whether such other cause be similar or dissimilar to those hereinabove specifically mentioned until said cause has been removed, Landlord reserves the right to interrupt, curtail, stop or suspend (i) the furnishing of heating, elevator, air conditioning, and cleaning services and (ii) the operation of the plumbing and electric systems. Landlord shall exercise reasonable diligence to eliminate the cause of any such interruption, curtailment, stoppage or suspension, but there shall be no diminution or abatement of rent or other compensation due from Landlord to Tenant hereunder, nor shall this Lease be affected or any of the Tenant's obligations hereunder reduced, and the Landlord shall have no responsibility or liability for any such interruption, curtailment, stoppage, or suspension of services or systems. (b) Notwithstanding anything to the contrary in this Lease contained, if the Premises shall lack any service which Landlord is required to provide hereunder, or if Tenant's use and occupancy of the Premises shall be disturbed in violation of Article 10 hereof (thereby rendering the Premises or a portion thereof substantially untenantable) so that, for the Landlord Service Interruption Cure Period, as hereinafter defined, the continued operation in the ordinary course of Tenant's business is materially adversely affected and if Tenant ceases to use the affected portion of the Premises during the period of untenantability as the direct result of such lack of service or disturbance, then, provided that Tenant ceases to use the affected portion of the Premises during the entirety of the Landlord Service Interruption Cure Period and that such untenantability and Landlord's inability to cure such condition is not caused by the fault or neglect of Tenant or Tenant's agents, employees or contractors, Yearly Rent, Operating Expense Excess and Tax Excess shall thereafter be abated in proportion to such untenantability until the day such condition is completely corrected. For the purposes hereof, the "Landlord Service Interruption Cure Period" shall be defined as five (5) consecutive business days after Landlord's receipt of written notice from Tenant of the condition causing untenantability in the Premises, provided however, that the Landlord Service Interruption Cure Period shall be ten (10) consecutive business days after Landlord's receipt of written notice from Tenant of such condition causing untenantability in the Premises if either the condition was caused by causes beyond Landlord's control or Landlord is unable to cure such condition as the result of causes beyond Landlord's control. (c) The provisions of Paragraph (b) of this Article 8.8 shall not apply in the event of untenantability caused by fire or other casualty, or taking (see Articles 18 and 20). -20- 29 8.9 ENERGY CONSERVATION. Notwithstanding anything to the contrary in this Article 8 or in this Lease contained, Landlord may institute, and Tenant shall comply with, such policies, programs and measures as may be necessary, required, or expedient for the conservation and/or preservation of energy or energy services, provided however, that Landlord does not, by reason of such policies, programs and measures, reduce the level of energy or energy services being provided to the premises below the level of energy or energy services then being provided in comparably aged, first-class office buildings in the greater Boston area, or as may be necessary or required to comply with applicable codes, rules regulations or standards. 8.10 MISCELLANEOUS. Other than air conditioning, all services provided by Landlord to Tenant are based upon an assumed maximum Premises population of one person per one hundred fifty (150) square feet of Total Rentable Area. Tenant acknowledges that if it exceeds the foregoing limitation, Landlord may incur costs including, without limitation, additional costs due to the additional load on building systems. Tenant agrees to reimburse Landlord for the amount of such costs (if any), as reasonably determined by Landlord, due to a Premises population in excess of the foregoing maximum. 9. ESCALATION 9.1 DEFINITIONS. As used in this Article 9, the words and terms which follow mean and include the following: (a) "Operating Year" shall mean a calendar year in which occurs any part of the term of this Lease. (b) "Operating Cost Base" shall be the amount as stated in Exhibit 1. (c) Subject to the provisions of Article 6(b),"Tenant's Building Percentage" and "Tenant's Complex Percentage" shall be the respective figures as stated in Exhibit 1. (d) "Taxes": Subject to Article 9.7: (d1) "Building Taxes" shall mean the real estate taxes and other taxes, levies and assessments imposed upon the Building and that portion of the land of the Complex comprised of the Building's footprint and an area surrounding the Building as shown on Exhibit 2-1, and upon any personal property of Landlord used in the operation of the Building, or on Landlord's interest in the Building or such personal property (provided that to the extent such taxes, levies, and assessments are also allocable to property other than the Building, such amounts shall be allocated among all real estate which is so jointly assessed based on the assessor's records or, if the records do not provide a separate allocation, based on square footage of the buildings in question); charges, fees and assessments for transit, housing, police, fire or other services or purported benefits to the Building; service or user payments in lieu of taxes; and any and all other taxes, levies, betterments, assessments and charges arising from the ownership, leasing, operating, use or occupancy of the Building or based upon rentals derived therefrom, which are or shall be imposed by federal, state, county, municipal or other governmental authorities. Notwithstanding anything to the contrary herein contained, with respect to -21- 30 betterments or other extraordinary or special assessments, Tenant's obligations shall apply only to the extent such assessments are payable during and in respect of the term of the Lease if paid over the longest period permitted by law. The definition of Building Taxes is subject to the provisions of Article 9.1(d4) (d2) "Land" shall mean all of the land of the Complex (but not any improvements thereon which are separately assessed, except for common facilities as set forth in Paragraph (d3) below), excluding, however, the land on which the Garage and all other parking areas are located and the portions of land under each building in the Complex and an area surrounding each such building as shown on Exhibit 2-1, and reasonable similar areas designated by Landlord in connection with new buildings added to the Complex from time to time. Real estate taxes with respect to such parking areas are included in the parking fees charged to users and real estate taxes attributable to the land comprised of the footprint and such perimeter area of each building in the Complex shall be allocated on a building-by-building basis. (d3) "Land Taxes" shall mean the real estate taxes and other taxes, levies and assessments imposed upon the Land, upon any common facilities separately assessed as such by the tax assessor, and upon any personal property of Landlord used in connection with the Land, or on Landlord's interest in the Land or such personal property (provided that to the extent such taxes, levies, and assessments are also allocable to property other than the Land, such amounts shall be equitably allocated among all real estate which is so jointly assessed); charges, fees and assessments for transit, housing, police, fire or other governmental services or purported benefits to the Land; service or user payments in lieu of taxes; and any and all other taxes, levies, betterments, assessments and charges arising from the ownership, leasing, operation, or use of the Land or based upon rentals derived therefrom, which are or shall be imposed by federal, state, county, municipal or other governmental authorities. Land Taxes shall exclude any taxes on any parking garage located on the Land or which are otherwise assessed as part of Building Taxes. The definition of Land Taxes is subject to the provisions of Article 9.1(d4). (d4) As of the Execution Date, neither Building Taxes nor Land Taxes shall include any inheritance, estate, succession, gift, franchise, rental, income or profit tax, capital stock tax, capital levy or excise, or any income taxes arising out of or related to the ownership and operation of the Building or Complex, provided, however, that any of the same and any other tax, excise, fee, levy, charge or assessment, however described, that may in the future be levied or assessed as a substitute for or an addition to, in whole or in part, any tax, levy or assessment which would otherwise constitute "Taxes," whether or not now customary or in the contemplation of the parties on the Execution Date of this Lease, shall constitute "Taxes," but only to the extent calculated as if the Complex were the only real estate owned by Landlord. "Taxes" shall also include reasonable expenses of tax abatement or other proceedings contesting assessments or levies. (e) "Tax Base" shall be the amount stated in Exhibit 1 and shall apply to a Tax Period of twelve (12) months. The Tax Base shall be reduced pro rata if and to the extent that the Tax Period contains fewer than twelve (12) months. -22- 31 (f) "Tax Period" shall be any fiscal/tax period in respect of which Taxes are due and payable to the appropriate governmental taxing authority (i.e., as mandated by the governmental taxing authority), any portion of which period occurs during the term of this Lease, the first such Period being the one in which the Rent Commencement Date (or, if there is more than one Rent Commencement Date hereunder, the first such date) occurs. (g) "Operating Costs": Subject to Article 9.7: (g1) Definition of Building Operating Costs. "Building Operating Costs" shall mean all costs incurred and expenditures of whatever nature made by Landlord in the operation and management, for repair and replacements, cleaning and maintenance of the non-retail portion of the Building, including, without limitation, vehicular and pedestrian passageways serving the Building, related equipment, facilities and appurtenances and cooling and heating equipment. For costs and expenditures made by Landlord in connection with the Building as a whole, Landlord shall make a reasonable allocation thereof between the retail and non-retail portions of the Building. A portion of Complex Operating Costs shall be included in Building Operating Costs in accordance with Subparagraphs g(3) and g(6). (g2) Definition of Complex Operating Costs. "Complex Operating Costs" shall mean all costs incurred and expenditures made by Landlord in the operation and management, repair and replacement, cleaning and maintenance of the common areas of the Complex, exclusive of the Garage, the Parking Areas, the Building, and the other buildings in the Complex. Any expenses incurred by Landlord that can be allocated on a building-by-building basis shall be so allocated in accordance with Subparagraph (g3). To the extent that a cost included in Complex Operating Costs is also allocable to property other than the Complex, such cost shall be equitably allocated to each parcel of property which benefits from such cost. (g3) The allocation of costs and expenditures among the various buildings in the Complex shall be on the basis of the ratio of the Total Rentable Area of each building in the Complex to the Total Rentable Area of the Complex, unless such allocation would result in a disproportionate charge based upon the relative usage of the service on which such cost is based, in which case such allocation shall be based upon such relative usage. Building Operating Costs and Complex Operating Costs shall include, without limitation, those categories of "Specifically Included Operating Costs", as set forth below, but shall not include "Excluded Costs", as hereinafter defined. (g4) Definition of Excluded Costs. "Excluded Costs" shall be defined as: (i) mortgage charges (including interest, principal, points and fees); (ii) brokerage commissions; -23- 32 (iii) salaries of executives and owners not directly employed in the management/operation of the Complex; (iv) the cost of work done by Landlord for a particular tenant for which Landlord has the right to be reimbursed by such tenant; (v) subject to Subparagraph (g5) below, such portion of expenditures as are not properly chargeable against income; (vi) any ground or underlying lease rental; (vii) bad debt expenses; (viii) costs incurred by Landlord to the extent that Landlord is reimbursed by insurance proceeds or is otherwise reimbursed, other than through the payment of Operating Costs; (ix) depreciation, amortization and interest payments, except as expressly set forth in subparagraph (g5) below and 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; (x) advertising and promotional expenditures, and costs of acquisition and maintenance of one-party signs in or on the Building identifying the owner of the Building or other tenants; (xi) 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; -24- 33 (xii) costs, including permit, license and inspection costs, incurred with respect to the installation of 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; (xiii) expenses in connection with services or other benefits which are offered to other tenants of the Building or Complex but not to Tenant or for which Tenant is charged directly, other than through Operating Costs; (xiv) fines, interest and penalties incurred by Landlord due to the violation by Landlord or any tenant of the terms and conditions of any lease of space in the Building; (xv) 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 market rate. (xvi) salaries and other benefits paid to any executive employees above the level of senior property manager of the Complex; (xvii) 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; (xviii) Landlord's general corporate overhead and general administrative expenses; (xix) any compensation paid to clerks, attendants or other persons in commercial concessions operated by Landlord; (xx) services provided, taxes, attributable to, and costs incurred in connection with the operation (as opposed to the repair and maintenance thereof which shall be included in Operating Costs) of any garage for the Building, and any replacement garages or parking facilities; (xxi) costs incurred in connection with upgrading the Building to comply with laws, rules, regulations and codes in effect prior to the Term Commencement Date; -25- 34 (xxii) fines, interest and penalties 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; (xxiii) costs arising from Landlord's political contributions; (xxiv) costs for sculpture, paintings or other objects of art; (xxv) 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 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; (xxvi) rentals for items which, if purchased rather than rented, would constitute a capital cost, to the extent that the rental payments exceed the costs which could be included pursuant to paragraph (g5) below; (xxvii) costs of electricity for plugs and lights provided to other tenants' demised premises; (xxviii) repair and replacement costs in connection with defects in Landlord's Work which are incurred by Landlord prior to the third (3rd) anniversary of the Full Rent Commencement Date; and (xxix) any costs related to any development, demolition or construction activity in the Building or the Complex, and any and all costs of construction mitigation measures, including, without limitation, dust control, cleaning, maintenance, debris removal, traffic control and noise control, but the foregoing shall have no effect on the inclusion of the cost of normal cleaning services for the Complex. (g5) Capital Expenditures. (i) REPLACEMENTS. If, during the term of this Lease, Landlord shall replace any capital items or make any capital expenditures -26- 35 (collectively called "Capital Expenditures") the total amount of which is not properly includable in Operating Costs for the Operating Year in which they were made, in accordance with generally accepted accounting principles and practices in effect at the time of such replacement, there shall nevertheless be included in such Operating Costs and in Operating Costs for each succeeding Operating Year the amount, if any, by which the Annual Charge-Off (determined as hereinafter provided) of such Capital Expenditure (less insurance proceeds, if any, collected by Landlord by reason of damage to, or destruction of the capital item being replaced) exceeds the Annual Charge-Off of the Capital Expenditure for the item being replaced. (ii) NEW CAPITAL ITEMS. If a new capital item is acquired which does not replace another capital item which was worn out, has become obsolete, etc., and such new capital item being acquired is either (i) required by law or (ii) reasonably projected to reduce Operating Costs, then there shall be included in Operating Costs for each Operating Year in which and after such capital expenditure is made the Annual Charge-Off of such capital expenditure. (iii) ANNUAL CHARGE-OFF. "Annual Charge-Off" shall be defined as the annual amount of principal and interest payments which would be required to repay a loan ("Capital Loan") in equal monthly installments over the Useful Life, as hereinafter defined, of the capital item in question on a direct reduction basis at an annual interest rate equal to the Capital Interest Rate, as hereinafter defined, where the initial principal balance is the cost of the capital item in question. (iv) USEFUL LIFE. "Useful Life" shall be reasonably determined by Landlord in accordance with generally accepted accounting principles and practices in effect at the time of acquisition of the capital item. Notwithstanding the foregoing, if Landlord reasonably concludes on the basis of engineering estimates that a particular capital expenditure will effect savings in Complex operating expenses including, without limitation, energy-related costs, and that such annual projected savings will exceed the Annual Charge-Off of Capital Expenditures computed as aforesaid, then and in such events, the Annual Charge-Off shall be determined based upon a Useful Life which would cause the principal and interest payments in a full repayment of the Capital Loan in question to equal the amount of projected savings of such Useful Life. (v) CAPITAL INTEREST RATE. "Capital Interest Rate" shall be defined as an annual rate of either one percentage point over the AA Bond rate (Standard & Poor's corporate composite or, if unavailable, its equivalent) as reported in the financial press at the time the capital expenditure is made or, if the capital item is acquired through third-party financing, then the actual (including fluctuating) rate paid by Landlord in financing the acquisition of such capital item. (g6) Specifically Included Categories of Operating Costs. Subject to the Excluded Costs definition, the qualifications on reimbursable Building Operating Costs and Complex Operating Costs set forth in Articles 9.1(g1) 9.1(g2) and 9.1(g3), and -27- 36 except as otherwise expressly excluded from the definition of Building Operating Costs and Complex Operating Costs pursuant to the provisions of this Lease, Building Operating Costs and Complex Operating Costs shall include, but not be limited to, the following, provided that if such costs are attributable to the Building and to other buildings in the Complex, then such costs shall be equitably apportioned among the Building and such other buildings in accordance with Article 9.1(g3), and if such costs are attributable to common areas of the Complex and to other property which is not part of the Complex, then such costs shall be equitably apportioned among the Complex and such other property. TAXES (other than Real Estate Taxes): Sales taxes and Federal Social Security, Unemployment and Old Age Taxes and contributions and State Unemployment taxes and contributions accruing to and paid by the Landlord on account of all employees of Landlord and/or Landlord's managing agent, who are employed in, about or on account of the Premises (to the extent that the underlying wages or salaries are included in Building Operating Costs or Complex Operating Costs, as the case may be), except that taxes levied upon the net income of the Landlord and taxes withheld from employees, and "Taxes" as defined in Article 9.1(d) shall not be included herein. WATER: All charges and rates connected with water supplied to the Premises, the Building and/or the common areas of the Complex and related sewer use charges. HEAT AND AIR CONDITIONING: The cost of electricity connected with heat and air conditioning supplied to the common areas of the Building and/or Complex, and all other charges connected with heat and air conditioning supplied to the Premises, Building and/or Complex. WAGES: Wages and cost of all employee benefits of all employees of the Landlord and/or Landlord's managing agent who are employed in, about or on account of the Premises and/or Complex provided that wages and costs for employees who also work on other properties shall be allocated to the Complex based upon the proportion of their time spent working on the Complex and then allocated to the Premises on a square foot basis. CLEANING: The cost of labor and material for cleaning the Premises and/or Complex, surrounding areaways and windows in the Premises and/or Complex, including, without limitation, the services listed on Exhibit 4. ELEVATOR MAINTENANCE: All expenses for or on account of the upkeep and maintenance of all elevators in the Premises, Building and/or the Complex (if any). ELECTRICITY: The cost of all electric current for the operation of any machine, appliance or device used for the operation of the Premises and the Building and/or Complex, including the cost of electric current for the elevators, lights, air conditioning and heating, but not including electric current which is paid for directly to the utility by the user/tenant in the Premises and/or Complex. (If and so long as Tenant is billed directly by the electric utility for its own consumption of electricity for lights and plugs as determined by its separate meter or by submeter, then Operating Costs shall include only public area electric current consumption and electricity for base building HVAC and not any demised Premises electric current consumption for lights and plugs.) Wherever -28- 37 separate metering is unlawful, prohibited by utility company regulation or tariff or is otherwise impracticable, relevant consumption figures for the purposes of this Article 9 shall be determined by fair and reasonable allocations and engineering estimates made by Landlord. INSURANCE, ETC.: Fire, casualty, liability and such other insurance as may from time to time be reasonably required by lending institutions on first-class office buildings in the City or Town wherein the Building is located and all other expenses customarily incurred in connection with the operation and maintenance of first-class suburban office/research and development buildings in the Market Area. MANAGEMENT SPACE: Market rate rental costs associated with the Complex's management office. COMPLEX AMENITIES: The cost of operating any amenities in the Complex available to all tenants of the Complex including, without limitation, any cafeteria. The costs to be included in Complex Operating Costs shall include any subsidy, including lower than market rate rent, provided by Landlord for or with respect to such amenity. In the event that the costs of a Complex amenity are included in an Operating Year but such costs were not included in the Complex Operating Costs Base, then the Complex Operating Costs Base shall be adjusted to reflect what would have been the costs for such amenity in the Complex Operating Costs Base if such amenity had been operated during calendar year 2000. 9.2 TAX EXCESS. (a) IN GENERAL. Commencing as of the Rent Commencement Date (or, if there is more than one Rent Commencement Date hereunder, the first such date), and continuing thereafter throughout the term of this Lease, if with respect to any Tax Period, the sum ("Tenant's Tax Share") of (i) Tenant's Building Tax Percentage of Building Taxes plus (ii) Tenant's Complex Tax Percentage of Land Taxes exceeds the Tax Base, Tenant shall, subject to Article 9.10, pay such excess to Landlord, such amount being hereinafter referred to as "Tax Excess." Tax Excess shall be due within thirty (30) days of Tenant's receipt of Landlord's bill therefor. In implementation and not in limitation of the foregoing, Tenant shall remit to Landlord pro rata monthly installments on account of projected Tax Excess, calculated by Landlord on the basis of the most recent Tax data available. If the total of such monthly remittances on account of any Tax Period is greater than the actual Tax Excess for such Tax Period, Tenant may credit the difference against the next installment of rental or other charges due to Landlord hereunder, except that if such difference is determined after the end of the term of this Lease, Landlord shall refund such difference to Tenant within thirty (30) days after such determination to the extent that such difference exceeds any amounts then due from Tenant to Landlord. If the total of such remittances is less than the actual Tax Excess for such Tax Period, Tenant shall pay the difference to Landlord within thirty (30) days of Tenant's receipt of the bill. (b) EFFECT OF ABATEMENTS. Appropriate credit against Tax Excess shall be given for any refund obtained by reason of a reduction in any Taxes by the Assessors or the administrative, judicial or other governmental agency responsible therefor. The original computations, as well as reimbursement or payments of additional charges, if any, or allowances, if any, under the provisions of this Article 9.2 shall be based on the original assessed valuations -29- 38 with adjustments to be made at a later date when the tax refund, if any, shall be paid to Landlord by the taxing authorities. Expenditures for reasonable legal fees and for other reasonable similar or dissimilar expenses incurred in obtaining the tax refund may be charged against the tax refund before the adjustments are made for the Tax Period. 9.3 OPERATING EXPENSE EXCESS. Commencing as of the Rent Commencement Date (or, if there is more than one Rent Commencement Date hereunder, the first such date), and continuing thereafter throughout the term of the Lease, if with respect to any Operating Year, the Building Operating Costs exceed the Operating Cost Base, Tenant shall, subject to Article 9.10, pay Tenant's Building Operating Cost Percentage of such excess to Landlord, such amount being hereinafter referred to as "Operating Expense Excess." Operating Expense Excess shall be due within thirty (30) days of the Tenant's receipt of the Landlord's bill therefor. In implementation and not in limitation of the foregoing, Tenant shall remit to Landlord pro rata monthly installments on account of projected Operating Expense Excess, calculated by Landlord on the basis of the most recent Operating Costs data or budget available. Landlord shall, within one hundred twenty (120) days after the end of each Operating Year, deliver to Tenant a reasonably detailed statement ("Year End Statement") of the actual amount of Operating Costs for such Operating Year. If the total of such monthly remittances on account of any Operating Year is greater than the actual Operating Expense Excess for such Operating Year, Tenant may credit the difference against the next installment of rent or other charges due to Landlord hereunder, except that if such difference is determined after the end of the term of this Lease, Landlord shall refund such difference to Tenant within thirty (30) days after such determination to the extent that such difference exceeds any amounts then due from Tenant to Landlord. If the total of such remittances is less than actual Operating Expense Excess for such Operating Year, Tenant shall pay the difference to Landlord within thirty (30) days of Tenant's receipt of Landlord's bill therefor. 9.4 PART YEARS. If any Rent Commencement Date or if the Termination Date occurs in the middle of an Operating Year or Tax Period, Tenant shall be liable for only that portion of the Operating Expense or Tax Excess, as the case may be, in respect of such Operating Year or Tax Period represented by a fraction the numerator of which is the number of days of the herein term (commencing as of the applicable Rent Commencement Date) which falls within the Operating Year or Tax Period and the denominator of which is three hundred sixty-five (365), or the number of days in said Tax Period, as the case may be. Any credit pursuant to Article 9.10 for the years in which any Rent Commencement Date or the Termination Date occur shall be similarly pro-rated. 9.5 EFFECT OF TAKING. In the event of any taking of a portion of the Complex, the Building or the land upon which it stands under circumstances whereby this Lease shall not terminate under the provisions of Article 20 then, for the purposes of determining Tax Excess, there shall be substituted for the Tax Base originally provided for herein a fraction of such Tax Base, the numerator of which fraction shall be the Taxes for the first Tax Period subsequent to the condemnation or taking which takes into account such condemnation or taking, and the denominator of which shall be the Taxes for the last Tax Period prior to the condemnation or taking, which did not take into account such condemnation or taking. Tenant's Building Tax Percentage shall be adjusted appropriately to reflect the proportion of the Premises and the Building remaining after such taking. -30- 39 9.6 ADJUSTMENT OF OPERATING COSTS BASED UPON OCCUPANCY. If less than ninety-five percent (95%) of the rentable area of the Building shall have been occupied by tenants at any time during any Operating Year (including the Base Year), or if services, for any other reason, are not provided by Landlord to at least ninety-five (95%) percent of the rentable area of the Building, then, at Landlord's election, Building Operating Costs for such Operating Year shall be adjusted to equal the amount which Landlord reasonably determines is the amount Building Operating Costs would have been for such period had occupancy been ninety-five percent (95%) throughout such period, or if such services had been provided to ninety-five (95%) percent of the Building throughout such period, as the case may be. 9.7 EFFECT OF CONVERSION OF COMPLEX TO A CONDOMINIUM. Landlord reserves the right to create a condominium encompassing some or all of the Complex, including the Building. In the event that such a condominium is created, then (i) if the Building shall constitute a separately assessed unit in the condominium, Building Taxes shall thereafter be defined as the amount of Taxes assessed against such unit, and if the Building does not constitute a separately assessed unit, Landlord shall thereafter equitably allocate Taxes to the Building and the Land on a reasonable basis; and (ii) Landlord shall include any condominium fees assessed against the unit containing the premises in Building Operating Costs and Complex Operating Costs, as the case may be, to the extent such fees represent costs which would otherwise be included in Building Operating Costs or Complex Operating Costs. The allocation of any such condominium fees between Building Operating Costs and Complex Operating Costs shall be based on square footage of Total Rentable Area of the premises benefiting from the cost in question, unless Landlord reasonably determines that such allocation should be made on another reasonable basis. 9.8 DISPUTES, ETC. Any disputes arising under this Article 9 may, at the election of either party, be submitted to arbitration as hereinafter provided. Any obligations under this Article 9 which shall not have been paid at the expiration or sooner termination of the term of this Lease shall survive such expiration and shall be paid when and as the amount of same shall be determined and be due. 9.9 TENANT'S AUDIT RIGHTS. Subject to the provisions of this paragraph, Tenant shall have the right, at Tenant's cost and expense, to examine all documentation and calculations prepared in the determination of Operating Expense Excess: 1. Such documentation and calculation shall be made available to Tenant at the offices where Landlord keeps such records during normal business hours within a reasonable time after Landlord receives a written request from Tenant to make such examination. 2. Tenant shall have the right to make such examination no more than once in respect of any period in which Landlord has given Tenant a statement of the actual amount of Operating Costs. 3. Any request for examination in respect of any Operating Year may be made no more than sixty (60) days after Landlord advises Tenant of the actual amount of Operating Costs in respect of such period. 4. Such examination may