ASSIGNMENT, ACCEPTANCE OF ASSIGNMENT
AND
CONSENT TO ASSIGNMENT OF LEASE
This Assignment, Acceptance of Assignment and Consent to Assignment
of Lease is made this 21st day of November, 1997 between ROXBURY CINEMA INC., a
New Jersey corporation whose principal office is located at 21 Sunset Strip,
Roxbury Mall, Succasunna, New Jersey 07876 and (hereinafter referred to as the
"Assignor"), and CCC Succasunna Cinema Corp., a corporation organized and
existing under the laws of Delaware, whose principal office is located at 7
Waverly Place, Madison, New Jersey 17940 (hereinafter collectively referred to
as the "Assignee").
WITNESSETH:
WHEREAS, Assignor entered into a Lease with FIRST ROXBURY COMPANY,
dated May 24, 1989, which Lease was modified by Lease Modification Agreement
dated May 2, 1990 between Roxville Associates, as successor Landlord, and
ROXBURY CINEMA INC., and further modified by Second Lease Modification Agreement
dated December 20, 1994 between Roxville Associates, and ROXBURY CINEMA INC., a
true copy of each is annexed hereto (hereinafter, collectively, the "Lease
Agreement"); and
WHEREAS, the Assignor wishes to assign to Assignee all of its right,
title and interest under and pursuant to the Lease Agreement; and
WHEREAS, the Assignee wishes to accept this Assignment of Lease as
of November 21st, 1997, and agrees to assume, perform and
abide by all of the terms, provisions and obligations of Assignor under the
Lease Agreement; and
WHEREAS, Roxville Associates (hereinafter the "Landlord") hereby
consents to assignment of the Lease Agreement to the Assignee on the terms and
conditions hereinafter set forth;
NOW, THEREFORE, in consideration of the foregoing and intending to
be legally bound hereby, the Assignor and Assignee hereby agree as follows:
1. Assignor hereby assigns all of its right, title and interest
under and pursuant to the Lease Agreement from and after November 21st, 1997 to
Assignee, and its respective successors and/or assigns.
2. Assignee hereby accepts this Assignment of Lease, and agrees from
and after November 21st, 1997 to assume, perform and abide by all of the terms,
provisions and obligations of the Assignor under the Lease Agreement.
3. Assignor shall be relieved from liability for the payment of rent
and the performance of all obligations and covenants under and pursuant to the
Lease Agreement from and after the date of this Assignment, Acceptance of
Assignment and Consent to Assignment of Lease.
4. This Assignment and Acceptance of Assignment of Lease shall be
binding upon the parties hereto and their respective heirs, successors and
assigns.
2
5. This Assignment and Acceptance of Assignment of Lease shall not
be modified or amended without the written consent of the parties hereto and the
Landlord.
IN WITNESS WHEREOF, the parties hereto have hereunto set their hands
as of the date and year hereinabove first written.
ATTEST: ROXBURY CINEMA INC., Assignor
/s/ Seth Ferman By: /s/ John Nelson
- -------------------------- ----------------------------
Seth Ferman, Secretary John Nelson, President
ATTEST: CCC Succasunna Cinema Corp., Inc.
Assignee
/s/ S. H. Mayo By: /s/ A. Dale Mayo
- -------------------------- ----------------------------
S. H. Mayo, Secretary A. Dale Mayo, President
CONSENT TO ASSIGNMENT
Roxville Associates hereby consents to the assignment of the Lease Agreement to
the above-named Assignee on the express understanding and condition that the
Assignor shall not be relieved from liability for the payment of the rent and
the performance of all obligations and covenants provided in the Lease
Agreement, and that no further assignment or sub-lease of any part of the
devised premises shall be made without the prior written consent of the
undersigned Landlord.
WITNESS: LANDLORD:
Roxville Associates
/s/ Illegible By: /s/ Salvatore A. Davino
- -------------------------- ----------------------------
Salvatore A. Davino
3
=====================================================================
FIRST ROXBURY COMPANY,
Landlord
TO
ROXBURY CINEMA INC.
Tenant
LEASE
Premises: Cinema Ten Theater
at
21 Sunset Strip, Roxbury Mall, Succasunna, New Jersey
=====================================================================
TABLE OF CONTENTS
1. Premises Page 1
2. Condition and Preparation of Premises Page 1
3. Certificate of Occupancy Page 2
4. Term Page 2
5. Rent Page 3
6. Real Estate Taxes Page 3
7. Common Areas Charge for Operating Costs Page 4
8. Additional Rent Page 5
9. Deleted Prior To Execution Page 6
10. Use Clause Page 6
11. Utilities Page 6
12. Insurance Page 6
13. Indemnity Page 7
14. Cleanliness Page 7
15. Broken Glass Page 7
16. Repairs and Replacements Page 7
17. Alterations: Trade Fixtures Page 8
18. Damage: Acts of God Page 8
19. Subordination Page 9
20. Quiet Enjoyment Page 9
21. Access Page 9
22. Condemnation Page 10
23. Assignment Page 10
24. Surrender Page 11
25. Default Page 11
26. Deleted Prior To Execution Page 11
27. Notice on Default Page 11
28. Remedies on Default Page 12
29. Certificate of Lease Status Page 13
30. Landlord's Lien Page 13
31. Signs Page 14
32. Parking and Maintenance of Parking Areas Page 14
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33. Compliance with Mortgage Requirements Page 14
34. Rules and Regulations Page 14
35. Headings Page 14
36. Compliance with Laws Page 14
37. Force Majeure Page 15
38. Performance of Tenant's Obligations Page 15
39. Waiver Page 15
40. Execution Page 15
41. Commission Page 15
42. Additional Remedies Page 15
43. Notices Page 15
44. Binding Effect Page 16
45. Severability Page 16
46. Supercession Page 16
47. Definition and Liability of Landlord Page 16
48. ECRA Compliance Page 17
49. Restrictive Covenant Page 17
50. Lease Conditional Page 17
51. Alteration Fund Page 18
52. Construction Conditions Page 19
53. Percentage Rent Page 21
54. Renewal Options Page 22
ii
LEASE AGREEMENT
THIS AGREEMENT, made this 24th day of May, 1989 between FIRST ROXBURY
COMPANY, with a principal office at 241-A Millburn Avenue, Millburn, New Jersey
07041, hereinafter referred to as "LANDLORD", and ROXBURY CINEMA INC., with a
principal office at 21 Sunset Strip, Roxbury Mall, Succasunna, New Jersey 07876,
hereinafter referred to as "TENANT".
WITNESS THAT:
1. PREMISES. The Landlord demises unto the Tenant and the Tenant leases
from the Landlord, for the term and upon the terms and conditions hereinafter
set forth certain premises consisting of (a) the premises currently under lease
by Tenant (the "EXISTING PREMISES") pursuant to that certain lease dated June
28, 1985 by and between Landlord and Tenant (the "EXISTING LEASE") consisting of
approximately 12,388 square feet and (b) a piece of vacant land immediately
adjacent to the Existing Premises as shown on Exhibit B annexed hereto (the
"ADDITIONAL PREMISES") upon which Tenant intends to construct an addition
containing approximately an additional 11,478 square feet (the "ADDITION") (the
Existing Premises and Additional Premises are hereinafter collectively referred
to as "PREMISES", or "LEASED PREMISES", or "DEMISED PREMISES"). The Demised
Premises are located in a shopping center (hereinafter referred to as "SHOPPING
CENTER") shown by cross-hatching on Exhibit A, attached hereto and made a part
hereof. The lease of the Demised Premises to Tenant hereunder shall include the
right to the non-exclusive use, in common with other facilities designed for
common use, as may be installed by Landlord, and of such other facilities as may
be provided or designated from time to time by the Landlord for the common use
of tenants in the Shopping Center and "Landlord's Property" (as hereinafter
defined), subject to the terms and conditions of this Lease.
2. CONDITION AND PREPARATION OF PREMISES. (a) The Landlord
warrants that it is the owner of the tract of land shown on Exhibit A,
hereinafter referred to as the "LANDLORD'S PROPERTY".
(b) The Tenant has examined the Demised Premises, and accepts them
in their present condition (except as otherwise expressly provided herein) and
without any representation on the part of the Landlord or its agents as to the
present or future condition of said Premises except that Landlord represents to
Tenant that water, sewer, electricity and gas are available to points within the
Demised Premises in quantities sufficient for the construction of the Addition
and use and operation of the Addition and Existing Premises for the purposes
contemplated hereby. In the event Tenant shall require access to areas outside
the Demised Premises for the purposes of obtaining, making or expanding
connections to existing systems (whether public or private) furnishing water,
sewer, electrical or gas service to the Demised Premises, then Landlord hereby
grants Tenant permission and right over Landlord's Property for the purpose of
obtaining, making or expanding connections to such systems and Tenant shall be
permitted to take such material and equipment onto Landlord's Property and
perform such work and/or excavations thereto as may be required. Landlord
represents that the Demised Premises are zoned for the operation of a theatre
comprising at least 23,866 square feet, provided that Tenant complies with the
Site Plan dated December 1, 1987 by EI Associates (Drawing No. 11101), and the
resolution approving said Site Plan approved March 1, 1988 (the "Resolution") by
the Board of Adjustment of the Township of Roxbury for the construction of the
Addition. Landlord agrees to perform, at such reasonable time as requested by
Tenant, the paving and fence work required under the Resolution at Landlord's
expense.
(c) On the Commencement Date, as defined hereafter, the Tenant shall
proceed with due diligence to construct the Addition and install such stock,
fixtures, and equipment and perform such other work necessary or appropriate to
prepare the Demised Premises for the opening of business.
1
(d) The Tenant shall have the right to run electric wires or make
such other installations in the Leased Premises and Landlord's Property as may
be necessary to effect a successful operation in the Leased Premises, provided
that the Tenant has such electric wires or other installations approved by the
Board of Fire Underwriters to the extent required by legal or insurance
requirements, the cost thereof to be borne by the Tenant and Tenant further
agrees at its expense to repair any damage to Landlord's Property as a result of
such installations and the maintenance and repair thereof.
(e) The conditions of the rights granted to Tenant pursuant to this
Section 2 shall be as follows:
(i) Landlord shall not be responsible or liable to Tenant
in any manner whatsoever for any loss, damage, destruction or
disappearance of any of the aforesaid items unless caused by the
wilfull or negligent acts or omissions of Landlord;
(ii) Tenant shall have procured liability insurance as
required hereinafter, pursuant to Section 12A hereto;
(iii) Tenant shall have the right to remove all equipment and
stock in the event the Lease rental never commences and upon the
expiration or termination of the term of this Lease.
3. CERTIFICATE OF OCCUPANCY. The Tenant covenants and agrees that the
Premises, when ready for occupancy, will comply with all municipal, state and
county rules and regulations, and agrees to procure a Certificate of Occupancy
(temporary or permanent), if required, issued by the municipality upon the
completion of the Demised Premises and prior to the operation of the Additional
Premises for business by the Tenant. If a temporary certificate is issued to the
Tenant, then the Tenant shall procure a permanent certificate prior to the
expiration of the temporary certificate, as same may be extended. To the extent
required, Landlord shall cooperate with Tenant to obtain the certificates of
occupancy required hereunder, including the execution of applications and
affidavits, provided that Landlord shall not incur any liability or expense in
connection therewith unless Landlord shall agree to be responsible therefor or
Tenant agrees to reimburse Landlord therefor.
4. TERM. Provided the contingencies set forth in Section 50 of this Lease
are satisfied, the term of this Lease shall commence on the date Tenant shall
obtain an unconditional building permit for the construction of the Addition
(hereinafter referred to as the "COMMENCEMENT DATE"), and shall end (unless
sooner terminated as hereinafter provided) at midnight on December 31 of the
thirtieth (30th) "Lease Year" after the "Rental Commencement Date" (as such
quoted terms hereinafter defined). Tenant's obligation to pay the rents reserved
hereunder shall not commence until the earlier of (a) two (2) years following
the Commencement Date or (b) the date that Tenant shall occupy the entire
Demised Premises (including the Addition) for the conduct of and be open for its
business (which earlier date is hereinafter referred to as the "RENTAL
COMMENCEMENT DATE"). Tenant shall be permitted to enter upon, measure, perform
tests and prepare the Additional Premises for the construction of the Addition
prior to the Commencement Date subject to all the terms, covenants and
conditions of this Lease except the covenant to pay the rents reserved
hereunder.
Landlord and Tenant hereby acknowledge that Tenant is presently occupying
the Existing Premises under a lease by and between Roxbury Associates
(Landlord's predecessor-in-interest) and Tenant dated June 28, 1985 as same may
have thereafter been amended, modified, restated and/or superceded
(collectively, the "PRIOR LEASE"). Notwithstanding anything contained in this
lease or in the Prior Lease to the contrary, Landlord and Tenant covenant and
agree that as of the Commencement Date, the Prior Lease shall be superceded by
this Lease and thereafter the rights of Landlord and Tenant relating to the
Demised Premises shall be governed by the terms of this Lease, except that
Tenant shall continue to pay the rents reserved under the Prior Lease to
Landlord until the Rent Commencement Date hereunder.
2
The term "LEASE YEAR" as used herein shall mean January 1 to December 31
of each calendar year occurring after the Rental Commencement Date. In the event
the Rental Commencement Date shall occur on or before June 30 of any calendar
year, then: (i) the first (1st) Lease Year shall be deemed to be the calendar
year in which the Rental Commencement Date shall occur; (ii) the "Percentage
Rent" (as defined in Section 53 hereof) shall be based on annual gross sales of
$1,400,000.00 prorated based on the number of days remaining in such calendar
year from the Rental Commencement Date to December 31 of such calendar year; and
(iii) the second (2nd) Lease Year shall commence on January 1 of the immediately
succeeding calendar year. In the event the Rental Commencement Date shall occur
after June 30 of any calendar year (the "SHORT YEAR"), then: (i) the first (1st)
Lease Year shall be deemed to commence on January 1 of the immediately
succeeding calendar year; (ii) the Percentage Rent payable for the Short Year
shall be based on annual gross sales of $1,400,000.00 prorated based on the
number of days remaining in such calendar year from the Rental Commencement Date
to December 31 of such calendar year; (iii) the term of this Lease shall expire
on December 31 of the thirtieth (30th) Lease Year and (iv) the fixed rent
payable for the Short Year shall be at the rate of $147,000.00 per year
($12,250.00 per month).
5. RENT. TO HAVE AND TO HOLD the same for a term of thirty (30) years as
described in Section 4 ("Term").
(a) Commencing with the Rental Commencement Date, Tenant agrees to
pay as fixed minimum annual rent for the Leased Premises during the term of this
Lease, the following sums:
Lease Year Annually Monthly
---------------- -------------- -------------
1-5 $147,000.00 $12,250.00
6-10 154,350.00 12,862.50
11-15 162,067.50 13,505.62
16-20 170,170.87 14,180.91
21-25 178,679.41 14,889.95
26-30 186,563.38 15,546.95
The fixed minimum rent shall be payable in equal monthly installments on the
first of each month. All such monthly installments of the fixed minimum annual
rent shall be payable to the Landlord, in advance subject to no offset or
deductions of any kind or nature whatsoever (except as otherwise provided in
this Lease), without previous notice or demand therefor, with the first monthly
installment to be due and payable upon the Rental Commencement Date and each
subsequent monthly installment to be due and payable on the first day of each
and every month following the first month after the Rental Commencement Date. If
the Rental Commencement Date is a date other than the first day of a month, rent
for the period commencing with and including the Rental Commencement Date until
the first day of the following month shall be prorated based on the number of
days in such month.
(b) Except as otherwise provided herein, in addition to the fixed
minimum annual net rent, Tenant shall pay all other charges provided for
hereunder, without previous notice or demand therefor, and in a manner and upon
the conditions herein set forth, all other charges of any kind or nature
attributable to the Premises, except as specifically set forth herein, it being
the intention of the parties that the rent payable to Landlord hereunder shall
be absolutely net. Landlord shall have no expense attributable to the operation
and maintenance of the Premises (except as specifically reserved by the Landlord
in this Lease), except payment of its own mortgage costs and except as otherwise
provided herein.
6. REAL ESTATE TAXES AND OTHER GOVERNMENTAL CHARGES. Tenant shall pay as
additional rent its pro rata share of any and all real estate taxes and
assessments, municipal water and sewer charges and other governmental levies and
charges, general and special, ordinary and extraordinary, foreseen and
unforeseen, of any kind or nature whatsoever, which are or may be assessed or
imposed upon the Shopping
3
Center which constitutes Block 45, Lots 23.3 on the Tax Map of the Township of
Roxbury, or which may become payable at any time during the term of this Lease.
Tenant's pro rata share shall be deemed to be that fraction whose numerator is
the total square footage of Tenant's Demised Premises and whose denominator is
the total square feet of leasable space in the Shopping Center as the same may
increase or decrease. The Shopping Center after the construction of the Addition
will contain 60,493 total square feet of leasable space. For the purposes of
this Article 6, Tenant's pro rata share shall currently be 39.45% which has been
computed by divided 23,866, the total leasable square foot area of the Leased
Premises after completion of the Addition, by 60,493, the total leasable square
foot area of the Shopping Center after construction of the Addition. Except as
hereinafter specifically provided with respect to Tenant's construction of the
Addition, Tenant shall not be obligated to pay for any increases in real estate
taxes and assessments or other governmental levies and charges to the extent the
same result from any additions or expansions of the Shopping Center. In the
event any assessment shall be assessed or imposed which may be payable in
installments, the same shall be included in Taxes in any year based on the
maximum permitted deferral of such assessment and only to the extent such
installments may be payable during the term of this Lease.
(a) Nothing contained in this Lease shall require Tenant to pay any
franchise, corporate, estate, inheritance, succession, capital levy or transfer
or sales tax of the landlord, or any income, profits or revenue tax or any other
tax assessment, charge or levy upon the rent payable by Tenant hereunder;
provided, however, that if at any time during the term of this Lease or any
renewal thereof, a tax in lieu of or in total or partial substitution for the
real estate tax, whether a tax on rents or otherwise, shall be assessed against
the Landlord or upon the rent as a substitution in whole or in part for real
estate taxes assessed on the land and building, such substituted tax shall be
deemed to be included in the calculation of the amount required to be paid by
the Tenant hereunder as if the Shopping Center were the sole asset of Landlord
and the rental derived therefrom were Landlord's only income. Tenant shall pay
100% of the taxes resulting from any additional assessment imposed upon the
Leased Premises and payable during the course of construction attributable to
Tenant construction of the Addition.
(b) Based upon the tax bills received by Landlord, Landlord shall
estimate Tenant's annual pro rata share of real estate taxes and one-twelfth
(1/12th) of the amount so estimated shall be paid on the first day of each
calendar month in advance. Within ninety (90) days after the end of each tax
year, Landlord shall furnish Tenant a statement in reasonable detail of the
actual real estate taxes prepared in accordance with sound accounting practices,
and there shall be an adjustment between Landlord and Tenant, with payment to or
repayment by Landlord, as the case may require, to the end that Landlord shall
receive the entire amount of Tenant's annual pro rata share for such period and
Tenant shall receive a refund of any overpayment. In the event that Landlord
shall revise Landlord's estimate of Tenant's annual pro rata share of real
estate taxes, Tenant shall have thirty (30) days from its receipt of Landlord's
revised estimate to begin paying the monthly installments of such revised amount
and thereafter shall pay the monthly installments of such revised amount on the
first day of each calendar month.
7. COMMON AREAS CHARGE FOR OPERATING COSTS. Tenant shall pay to the
Landlord, as additional rent during each lease year, a proportionate share of
the "Operating Costs", as hereinafter defined, of the common areas and
facilities in the Shopping Center. Tenant's proportionate share of Operating
Costs for the purposes of this Paragraph 7 shall mean 39.45%, which has been
computed by divided 23,866, the leasable square foot area of the Leased Premises
after the completion of the Addition, by 60,493. Tenant's Proportionate Share of
Operating Costs shall be subject to increase or decrease with changes in the
leasable square foot area of the Shopping Center. Provided Tenant's
proportionate share of Operating Costs shall not increase as a result thereof,
Landlord may combine the Operating Costs for the Shopping Center with those of
the shopping centers adjoining the Shopping Center (which are currently owned by
Landlord) (the "EXPANDED CENTER"), provided Tenant's proportionate share shall
be recomputed as above provided to reflect the leasable square foot area of the
Expanded Center. "OPERATING COSTS" as used herein shall mean the total costs and
expenses incurred by Landlord, its agents, and/or designees for operating,
maintaining, repairing and/or replacing all or any part of the common areas (and
any installation therein, thereon, thereunder or thereover), for the following:
the total costs and expenses incurred in cleaning, planting, replanting and
maintaining the landscaping; the cost of the following types of Landlord's
insurance,
4
bodily injury, public liability, property damage liability, automobile parking
lot liability insurance provided such insurance does not exceed that carried by
owners of similar properties, sign insurance carried by Landlord for the common
areas in limits reasonably selected by Landlord and Landlord will provide
evidence of such insurance together with its demand for payment; repairs,
repaving, line repainting, exterior repainting, rental and maintenance of signs
and equipment in connection with the operation maintenance of repairs of the
common areas, lighting, sanitary control, removal of snow and ice, roofs, trash
and rubbish, garbage and other refuse, utility charges for serving the common
areas (and any onsite and/or offsite sanitary treatment plants(s) servicing the
Shopping Center and all pipes leading to and from same), the cost of personnel
to implement such services, including directing parking and policing the common
facilities and common areas, fees for required licenses and permits, fire,
security and police protection, public address system(s), public toilets, all
rental charges for movable equipment, supplies, materials and labor; and twenty
percent (20%) of all of the foregoing costs to cover the Landlord's
administrative and overhead costs. Operating Costs shall not include (1) costs
of preparing any space in the Shopping Center for occupancy by a tenant; (2)
administrative, executive and partner wages and salaries; (3) renting and
leasing commissions; (4) franchise taxes or income taxes of landlord; (5) real
estate taxes and assessments; (6) the cost of any items for which Landlord is
reimbursed by payments by Tenant, by any other tenant(s) or occupant(s) of the
Building (except under rent adjustment provisions similar to those contained in
this Paragraph 7), by any other third party or parties, or by insurance proceeds
or condemnation awards; (7) the cost of performing any special services
furnished to other tenants of the Building and not furnished to Tenant; (8) the
cost of enforcing any obligations of other tenants of the Shopping Center (9)
the cost of correcting defects in the construction of the Shopping Center or in
the Shopping Center equipment; (10) any insurance premium (to the extent that
Landlord is separately reimbursed therefor by Tenant, or by any other tenant or
occupant of the Building, by means other than sharing of increases in Operating
Costs; (11) the cost of any work or services performed for, or facilities
furnished to, any tenant (including Tenant) at such tenant's cost; (12) any cost
paid by Landlord to a related corporation, entity, or person (to the extent that
such costs are in excess of the costs that would have been paid by Landlord in
the absence of such a relationship); (13) interest, amortization and other
charges paid in respect of mortgage or other loans; (14) gound lease and other
rent paid by Landlord; (15) depreciation of the Building, amortization and other
non-cash charges; (16) expenditures for capital improvements or replacements not
specifically included herein; and (17) fire insurance provided for in Paragrph
12(b) of this Lease.
Common facilities and common areas, whether such terms are used
individually or collectively, shall mean all areas, space, equipment, signs and
special services provided by Landlord for the common or joint use and benefit of
the occupants of the Shopping Center, and their employees, agents, servants,
customers and other invitees, including without limitation, parking areas,
access roads, retaining walls, landscaped areas, truck serviceways or tunnels,
loading docks, pedestrian malls (enclosed or open), courts, community hall or
auditorium (if any) and parcel pick-up stations.
Based upon Operating Costs for the previous calendar year after
taking into account reasonably anticipated increases or decreases, Landlord
shall estimate Tenant's annual pro rata share of common area charges and
one-twelfth (1/12th) of the amount so calculated shall be paid on the first day
of each calendar month in advance. Within ninety (90) days after the end of each
calendar year, Landlord shall furnish Tenant a statement in reasonable detail of
the actual common area charges prepared in accordance with sound accounting
practices, and there shall be an adjustment between Landlord and Tenant, with
payment to or repayment by Landlord, as the case may require, to the end that
Landlord shall receive the entire amount of Tenant's annual pro rata share for
such period. Tenant shall be permitted to conduct an audit, at its own cost and
expense, of common area maintenance charges. In the event that Landlord shall
revise Landlord's estimate of Tenants proportionate share of Operating Costs,
Tenant shall have thirty (30) days from its receipt of Landlord's revised
estimate to begin paying the monthly installments of such revised amount and
thereafter shall pay the monthly installments of such revised amount on the
first day of each calendar month.
8. ADDITIONAL RENT. Any and all sums required to be paid by Tenant
hereunder, whether to Landlord or otherwise, shall for purposes of Landlord's
rights upon
5
the non-payment thereof and for all other purposes for which the same shall be
relevent, be deemed in all respects to be additional rent subject to the same
duties and obligations and the payment thereof and for all other purposes for
which the same shall be relevent, be deemed in all respects to be additional
rent subject to the same duties and obligations and the same remedies of
Landlord for the non-payment of basic rent.
9. DELETED PRIOR TO EXECUTION.
10. USE CLAUSE. The Tenant shall have the right to utilize the Premises
solely for the purposes of a movie theatre, including the sale of food for
on-premises consumption, concession items, souvenirs and similar items and
activities conducted in movie theatres.
11. UTILITIES. The Tenant shall pay for all utilities when the same
becomes available for its utilization, as recorded on separate meters currently
existing in the Demised Premises including water, gas, electricity and fuel
consumed for heating. In the event that Tenant's special utilization of the
property shall produce a surcharge in utility costs or insurance generally
applicable to Landlord's Center, such surcharges shall be the responsibility of
and paid for by the Tenant.
12. INSURANCE. (a) Tenant shall, during the entire term hereof, keep in
full force and effect a policy of public liability and property damage insurance
with respect to the Leased Premises including curbs and sidewalks, and the
business operated by Tenant and any subtenants of Tenant) or shall cause such
subtenants to carry such insurance) in the Leased Premises in which the limits
of public liability shall not be less than $500,000.00 per person and
$1,000,000.00 per accident or occurrence and in which the property damage
liability shall not be less than $100,000.00. The policy shall name Landlord,
any person, firms or corporations designated by Landlord, and Tenant as named
insureds, and shall contain a clause; (i) that all the provisions thereof,
except the limits ofliability, shall operate in the same manner as if there were
a separate policy covering each insured; and (ii) that the insurer will not
change or terminate the insurance without first giving the Landlord and
landlord's designees thirty (30) days prior written notice. A copy of the policy
or certificate of insurance shall be delivered to Landlord on or before the
Commencement Date.
(b) Tenant will indemnify Landlord and save it harmless from and
against any and all claims, actions, damages, losses, liability and expenses in
connection with loss of life, personal injury and/or damage to property arising
from or our or any occurrence in, upon or at the Leased Premises, (excepting
acts due to Landlord's negligence) or the occupancy or use by Tenant of the
Leased Premises or any part thereof, or occasioned wholly or in part by an act
or omission of Tenant, its agents, contractors, employees, servants, lessees, or
concessionaires. In case landlord shall be made a party to any litigation
commenced by or against Tenant, then Tenant shall protect and hold Landlord
harmless and shall pay all costs and expenses incurred or paid by Landlord in
connection with such litigation.
(c) Landlord shall maintain in full force and effect a policy of
fire insurance with comprehensive coverage on the Leased Premises written by an
insurance company or companies authorized to do business in the State of New
Jersey, in an amount(s) equal to the actual full cash replacement value of the
Shopping Center including without limit, the Demised Premises and completed
Addition. Tenant agrees to reimburse Landlord for its pro rata share, based on
the square footage occupied by Tenant as a percentage of the total square
footage of the entire Shopping Center. Based upon Landlord's insurance costs for
the previous calendar including reasonably anticipated increases or decreases,
Landlord shall estimate Tenant's annual pro rata share of said insurance and
one-twelfth (1/12th) of the amount so estimated shall be paid on the first day
of each calendar month in advance. Within ninety (90) days after the end of each
calendar year, Landlord shall furnish Tenant a statement in reasonable detail of
the actual insurance costs prepared in accordance with sound accounting
practices, and there shall be an adjustment between Landlord and Tenant, with
payment to or repayment by Landlord, as the case may require, to the end that
landlord shall receive the entire amount of Tenant's annual pro rata share for
such period and Tenant shall receive a refund of all over payments. In the event
Landlord shall revise its estimate of Tenant's
6
proportionate share of insurance costs as set forth above, Tenant shall have
thirty (30) days from its receipt of Landlord's revised estimate to begin paying
the monthly installments of such revised amount and thereafter shall pay the
monthly installments of such revised amount on the first day of each calendar
month. Landlord shall provide Tenant with copies of all insurance premiums and
evidence of payment thereof. Landlord shall furnish Tenant with proof of the
fire insurance required to be carried by Landlord hereunder by delivering
certificates of such insurance to Tenant, which shall name Tenant as additional
insured and shall provide that such insurance shall not be modified or cancelled
without at least ten (10) days prior written notice to Tenant. In the event
Landlord shall fail to furnish said insurance or renew the same at least thirty
(30) days prior to the expiration thereof, Tenant may (but shall not be
obligated to) procure the same, at Landlord's expense, and Landlord shall
reimburse Tenant for the cost thereof within ten (10) days of demand, together
with interest at the rate of ten (10%) percent per year until payment.
(d) Tenant shall purchase rent insurance insuring against Landlord's
loss of rent for a period of up to one (1) year in the event of any damage or
destruction to the Premises wherein an abatement of rent is permitted under this
Lease.
(e) Tenant at its option, may self-insure plate glass, or purchase
insurance covering plate glass. In the event Tenant purchases insurance, Tenant
shall provide Landlord with a copy of a certifiate of insurance or, if requested
by Landlord, a copy of said policy.
(f) If the Tenant shall fail, refuse or neglect to obtain any of the
insurance called for by the within agreement or to maintain the same and to show
the Landlord evidence for the same as aforesaid within ten (10) days of request
therefor, the Landlord shall have the right to procure any such insurance for
the benefit of the Tenant and add the cost thereof to any rental payable
hereunder, together with interest of ten percent (10%) thereon until payment.
13. INDEMNITY. The Tenant agrees to indemnify the Landlord against and
save it harmless from any and all liability, loss or damage by reason of injury
or damage to any person or to any property belonging to the Landlord or any
other person, occurring in or about the Demised Premises, caused by or resulting
from fire, steam, electricity, gas, water, rain, ice or snow, or any leak of
flow from or into any part of said building or from any kind of injury which may
arise from any other cause whatsoever in or on the Demised Premises, unless such
injury or damage be caused by or be due to the willful acts or negligence of the
Landlord, or its agents, servants and employees, in which event the Landlord
agrees to indemnify the Tenant in similar manner to the indemnification herein.
14. CLEANLINESS. The Tenant agrees to keep and maintain the Premises and
each and every part thereof, in a clean, neat and businesslike condition.
Landlord, at its expense, will keep the remainder of the Shopping Center clean
and neat in a manner consistent with a first-class Shopping Center.
15. BROKEN GLASS. For the term of this Lease, the Tenant shall, at its own
cost and expense, replace any and all cracked or broken glass in or about the
Demised Premises.
16. REPAIRS AND REPLACEMENTS. The Tenant shall keep the interior parts of
the Demised Premises and the Addition in good repair and condition except,
repairs required by the acts of Landlord, its agents, employees and contractors,
all of which shall be repaired by Landlord, at its expense. Tenant shall comply
with all rules, regulations and requirements of any Federal, State, County or
Municipal authority, or the Board of Fire Underwriters or like organization,
applicable to the Demised Premises except Tenant shall not be obligated to make
any structural alterations with respect to the Existing Premises (as
distinguished from the Addition) unless caused by the acts of Tenant, its
agents, employees or contractors. Excepting landlord's obligation for structural
repairs and damage by fire, the elements, other casualty, unsafe condition or
condition caused by the acts of landlord, its agents, employees or contractors,
Tenant shall make all other repairs, renovations and alterations of any kind or
nature whatsoever throughout the term of this Lease and all option periods
thereof.
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(A) Notwithstanding anything to the contrary contained in this
Lease, Landlord shall, at its expense, during the Lease Term keep in good order,
condition and repair the foundation and exterior walls of the Existing Premises
(excluding the Additions) and all water, sewer and utility lines outside the
Demised Premises, with the following exceptions, which Tenant shall be
responsible for:
(i) Repairs occasioned by a harmful act, negligence or
omissions of Tenant or any of Tenant's employees, agents or invitees, and
(ii) Repairs occasioned by any of Tenant's Work on or
construction of the new Addition.
In the event a structural repair is required on the Addition and Tenant
shall not repair same within thirty (30) days after receipt of notice from
Landlord, then Landlord may proceed with the required repair on behalf of
Tenant, in which event Tenant shall reimburse Landlord for all sums paid to
effect such repair as if it were additional rent.
(B) Tenant shall, during the term of the Lease make all repairs,
structural and otherwise (except for repairs required to be performed by
Landlord pursuant to Section A hereinabove) to:
(i) The Addition;
(ii) The originally Demised Premises on those occasions as
set forth in Section A(i) and (ii); and
(iii) All roof areas of the Demised Premises.
(C) Landlord shall maintain and repair the common areas of the
Shopping Center in a manner consistent with a first class Shopping Center.
17. ALTERATIONS: TRADE FIXTURES. With the prior written consent of
Landlord, not to be unreasonably withheld, or delayed the Tenant may, during the
term of this Lease or any extension thereof, at its own cost and expense, make
any structural alterations or changes of the partitions if they are necessary or
desirable for the operation of its business. Tenant may at any time, without
Landlords' consent, remodel, make non-structural alterations, or improvements
within the Demised Premises as finally constructed, provided it complies with
all laws, ordinances and requirements of any kind and all Federal, State,
Municipal and/or other authorities, and the Board of Fire Underwriters; and all
such nonpermanent alterations, improvements and additions (including fixtures)
shall belong to and become the property of the Landlord upon the expiration of
the term of this Lease. Trade fixtures and equipment may be removed by Tenant,
provided it shall not be in default and Tenant shall restore the Demised
Premises to its original condition prior to such removal. Landlord shall be
deemed to have consented to any request for consent to which Landlord has not
responded within ten (10) days of Tenant's request.
18. DAMAGE: ACTS OF GOD. The Landlord shall repair, rebuild and
restore, at its own expense, and with due diligence, any and all damage to the
Demised Premises sustained as a result of fire; the elements or other casualty
or occurrence or an act of God; and in the event the Demised Premises, in part
or total, are rendered unusable or unfit for the Tenant's business in Tenant's
reasonable opinion, an abatement shall be made for the rent corresponding for
the time during which, and the extent to which, in Tenant's reasonable opinion,
it cannot be used by the Tenant for the conduct of its business after damage
occurring as aforesaid and before repair. In the event of total destruction of
the Demised Premises, or if use of the Demised Premises are rendered
economically unfeasible, in Tenant's reasonable opinion, the rent will be
totally abated. In the event of partial destruction, to be defined as the
destruction of less than fifty percent (50%) of the Demised Premises and are
thereby rendered useless, then the rent will be equitably abated, in accordance
with the square footage of the Demised Premises so rendered unusable provided
that Tenant, in the exercise of its reasonable business judgement, shall be able
to feasibly conduct its business in the undamaged portion of the Demised
Premises. Without limiting Landlord's obligation to restore the Demised Premises
or
8
Tenant's rights, at law or in equity, in the event Landlord shall fail to
restore the Demised Premises, in the event of total destruction of said
Premises, such as to render them unsuitable for the business of the Tenant, in
Tenant's reasonable opinion, unless the Demised Premises are repaired and
reinstated by the Landlord within six (6) months to a condition comparable at
the time of such destruction subject to an extension of up to one (1) year to
complete such repairs if said destruction is a result of fire, the elements or
other casualty or occurrence or an act of God, then at Tenant's option, the
Lease shall cease and come to an end and the Tenant shall be liable for the rent
only upon to the time of such total destruction of said Demised Premises.
Notwithstanding the foregoing, Tenant shall not exercise its right to terminate
this Lease as provided in the immediately preceding sentence so long as Landlord
has commenced the restoration of the Demised Premises within six (6) months of
the destruction and has thereafter diligently and continuously pursued such
restoration and continues to do so to completion. In the event of partial
destruction of said Demised Premises, such as to render them unsuitable for the
business of the Tenant, in Tenant's reasonable opinion, unless the Demised
Premises are repaired and restored by the Landlord within one hundred fifty
(150) days (subject to an extension of up to one (1) year if said destruction is
the result of fire, the elements or other casualty or occurrence or an act of
God), to a condition comparable to the time of said destruction, then at
Tenant's option the Lease shall cease and come to an end and the Tenant shall be
liable for rent only up to the time of such partial destruction of the Demised
Premises.
19. SUBORDINATION. Provided the holder of each such mortgage shall execute
and deliver to Tenant the "Non Disturbance Agreement" (as hereinafter defined),
this Lease shall not be superior to any mortgages that now encumber, or may
hereafter be placed upon, the said Premises. Any such mortgage or mortgages for
which a Non-Disturbance Agreement has been executed shall have preference and
precedence and be superior and prior in lien to this Lease, irrespective of the
date of recording, and the Tenant agrees to execute any instruments, without
cost, which may be deemed reasonably necessary or desirable, to further effect
the subordination of this Lease to any such mortgage or mortgages, provided such
instruments shall not increase Tenant's obligations or diminish Tenant's rights
under this Lease. The subordination of this lease to mortgages as herein
provided is subject to the condition that the holder of each such mortgage shall
execute and deliver to Tenant an agreement in writing (the "Non-Disturbance
Agreement") which shall provide that provided Tenant is not in default after
notice and the expiration of any of the applicable grace periods under this
Lease then (i) Tenant shall not be named or joined in any action or proceeding
to foreclose any of such mortgages, (ii) such action or proceeding shall not
result in a cancellation or termination of the term of this Lease, and (iii) in
the event any such holder or its designee or successor shall succeed to the
rights of Landlord under this Lease, this Lease shall continue in full force and
effect as a direct lease between the Tenant and such holder or its designee or
other successor to the rights of Landlord. Landlord represents to Tenant as of
the date hereof, there are no ground or underlying leases which are superior to
this Lease. Subject to the provisions of Paragraph 50 hereof, Tenant
acknowledges that this Lease shall be subject and subordinate to the existing
mortgages encumbering the Leased Premises but not any refinancings,
replacements, extensions or modifications thereof or any additional financing
secured by Landlord on the Shopping Center, unless tenant shall have received
the Non-Disturbance Agreement referenced heretofore.
20. QUIET ENJOYMENT. The Landlord will put the Tenant in actual possession
of the hereby Demised Premises at the beginning of the term aforesaid, or such
other date as shall be herein elsewhere agreed upon, and the Tenant, subject to
all the terms and conditions hereof, on paying the rent and performing the
covenants herein agreed by it to be performed, shall and may peacably and
quietly have, hold and enjoy, for said term and any extensions thereof, the
Demised Premises, the areas, spaces, parking facilities, passageways, sidewalks,
exits, entranceways and uses aforesaid on the terms and condition contained in
this Lease.
21. ACCESS. The Landlord and its agents, servants, employees, designess or
independent contractors shall have access to enter in and upon the said Demised
Premises upon reasonable prior notice (except in emergencies) at reasonable
hours for inspection and to make any repairs, modifications, alterations,
inspections or maintenance or replacements desirable, or required, if it be
needed to the Demised Premises or Shopping
9
Center. The Tenant shall unload its stock and have all deliveries made at the
area reasonably designated by Landlord for loading and unloading in the area
nearest the Demised Premises. Landlord, in the performance of its rights under
this paragraph shall use all efforts and cause all other parties to minimize the
interference with Tenant's use and occupancy of the Demised Premises.
22. CONDEMNATION. If all or part of the Demised Premises, all access to
the Demised Premises or so much parking for the Demised Premises as to render
use thereof unlawful shall be taken for any public or quasi-public use, under
any statute or by right of eminent domain, such as to render them unsuitable for
the business of the Tenant in Tenant's reasonable opinion, then this Lease, at
the option of the Tenant to be exercised within (90) days of the date of the
taking, shall be cancelled and declared null and void and of no effect, and the
Tenant shall be liable for the rent only up to such time of such taking. In the
event of partial taking, which is not extensive enough to render the Demised
Premises unsuitable for the business of the Tenant in Tenant's reasonable
opinion, the Landlord shall promptly restore the Demised Premises to a condition
comparable to its condition at the time of said condemnation and the Lease shall
continue, but starting with the date of such restorations, the rental shall be
reduced proportionately based upon the reduction in square footage of the
Demised Premises. In the event of the occurrence of the contingencies above
mentioned, or complete condemnation, rent shall abate corresponding with the
time during which the Demised Premises may not be used by the Tenant.
(a) In the event that fifty percent (50%) or more of the parking
area for the entire Shopping Center, of which the Demised Premises constitute a
part, or such amount of parking area as will render use of the Demised Premises
unlawful for the purposes herein contemplated, shall be taken or condemned by
public or quasi-public authority, the Tenant shall have the option to terminate
this Lease within thirty (30) days from the date of such taking or condemning.
If the Tenant shall fail to so terminate the said Lease within the time
aforesaid, then this Lease shall remain in full force and effect. In the event
this Lease shall be terminated in the event of any damage, destruction, casualty
or condemnation, any annual rental or any charges paid in advance shall be
refunded to the Tenant upon its surrender of possession of the remaining
Premises.
(b) Nothing herein contained shall be deemed or construed to prevent
the Landlord or Tenant from enforcing and prosecuting in any condemnation
proceedings, a claim for the value of their respective interest, but in no event
shall any award to the Tenant reduce any award to the Landlord for the value of
the fee or leasehold.
23. ASSIGNMENT. Except as hereinafter specifically provided to the
contrary, Tenant may not assign this Lease or sublet the Premises or any portion
thereof or effect a sale or change of ownership of its stock without Landlord's
prior written consent, which shall not be unreasonably withheld or delayed. Upon
submitting any request for Landlord's consent, Tenant shall submit the financial
statement of the proposed assignee or successor and the expertise and experience
of the proposed assignee or successor in operating movie theaters, all of which
shall be reasonably satisfactory to Landlord, but Landlord shall not withhold
its consent to any proposed assignment based on the financial statement of the
proposed assignee if the financial statement of such assignee indicates a net
worth at least equal to that of the Tenant hereunder at the time of such
assignment. In the event of any permitted assignment or sublet, (i) neither
Tenant nor Guarantors shall be relieved from any liability under this Lease; and
(ii) all of the provisions of this Lease shall be binding upon an assignee or
subtenant. Any written consent of Landlord shall be effective in that instance
only and shall not be deemed to apply to future assignment, sublease or sale or
transfer of stock. Tenant's application for Landlord's consent as herein
provided shall contain the proposed use by the proposed assignee or subtenant as
a condition of such application.
Anything in this Section to the contrary notwithstanding, Tenant
shall not be permitted to assign or sublet the Premises or any portion thereof
to any assignee or subtenant who shall engage in the conduct of a supermarket
for the retail sale of food and such non-food items as are customarily sold in
supermarkets in the Metropolitan-New York area. Additionally, Tenant may not
assign or sublet the Premises to any tenant whose use would be in competition
with an existing tenant at the Center or whose use
10
would be in violation of any restrictions on tenant's use the subject of binding
contracts between Landlord and other tenants at the Center. Landlord shall be
under absolutely no obligation to consent to either of the foregoing. Tenant
shall have the right to assign this Lease for the use clause contained herein.
Notwithstanding the foregoing provisions of this Section 23, Landlord's
consent shall not be required for the following transactions:
(i) sublettings of portions of the Demised Premises to
concessionairres or vendors for the sale of food, beverages, popcorn, candy,
souvenirs, novelties and/or other items as are sold in movie theatres;
(ii) subletting or rental of one or more auditoriums of the Demised
Premises to a distributor for the exhibition of a specific motion picture, in
any case, on a temporary basis (hereinafter referred to as "4-Wall Deal") and
provided the proceeds thereof and ticket sales resulting therefrom are included
in "Gross Sales" (as hereinafter defined);
(iii) any transfer or sale of the stock of Tenant among John A.
Nelson and Robert Ferman or their respective immediate family members (the
"Permitted Transferees"); and
(iv) any assignment, subletting or stock transfer with or to any
parent, affiliate or subsidiary entity or any entity which controls, is
controlled by or under common control with John A. Nelson or Robert Ferman or
their respective immediate family members.
24. SURRENDER. Upon the expiration or other termination of the term of
this Lease, the Tenant shall quit and surrender to the Landlord the Demised
Premises, in good order and condition, ordinary wear and tear and damage by fire
and other casualty excepted. The Tenant shall have the right to remove movable
trade fixtures and equipment from said Demised Premises, and shall repair any
damage caused by such removal.
25. DEFAULT. The following shall be deemed to be events of default
hereunder after the notice and cure period set forth in Paragraph 27:
(a) Failure of Tenant to make any payment of rent or additional rent
when due or within ten (10) days thereafter.
(b) Failure of Tenant to perform any of the terms, covenants or
conditions of this Lease.
(c) In the event that Tenant shall be adjudicated a bankrupt,
insolvent, or placed in receivership, or should proceedings be instituted by or
against the Tenant for bankruptcy, insolvency, receivership, agreement of
composition or assignment for the benefit of creditors, or if this Lease or the
estate of the Tenant herein shall pass to another by virtue of any court
proceeding, writ of execution, levy sale or by operation of law, other than
testate distribution or interstate decent and distribution.
(d) Recordation or attempted recordation of this Lease by Tenant.
(e) Vacation or abandonment of the Premises by Tenant.
(f) Failure of Tenant to take up occupancy of the Premises when the
same shall be ready for occupancy as set forth in this Lease.
26. DELETED PRIOR TO EXECUTION
27. NOTICE OF DEFAULT. In the event of any default as defined in Section
25(a) of the Lease, Landlord agrees to notify Tenant in writing, specifying the
nature of such default and Tenant agrees to remedy and cure said default within
ten (10) days after receipt of Landlord's notice. In the event of any default as
defined in Sections 25(b), (d),
11
(e) or (f) of this Lease, Landlord agrees to notify Tenant in writing,
specifying the nature of such default and Tenant agrees to remedy and cure said
default within thirty (30) days after receipt of Landlord's notice. If the said
default specified shall be of such nature that the same cannot reasonably be
cured or remedied within said thirty (30) day period, and Tenant shall fail to
commence the curing or remedying of such default within said thirty (30) day
period and shall not thereafter continuously and diligently proceed therewith to
completion, then Landlord shall have the right to proceed with the Landlord's
remedies on default as provided for in the Lease or as permitted by law and
Tenant shall not be deemed in default if Tenant shall so commence and prosecute
such cure or remedy. Nothing in this Paragraph shall be deemed to require lessor
to give more than ten (10) days notice prior to the commencement of a summary
proceeding for non-payment of rent or a plenary action for the recovery of rent
on account of any default in the payment of rent, it being intended that such
notices are for the sole purpose of creating a conditional limitation hereunder
pursuant to which this Lease shall terminate and the Lessee shall become a
holdover tenant.
28. REMEDIES ON DEFAULT. (a) In the event of any default as defined in
Section 25 hereof, or if Tenant shall be vacated by summary proceedings or
otherwise, the Landlord, in addition to other remedies herein contained, or as
may be permitted by law, may, without being liable for prosecution therefore, or
for damages, re-enter the said Premises and the same have and again possess and
enjoy; and as agent for the Tenant or otherwise, re-let the Premises and receive
the rents therefore and apply the same, first to the payment of such expenses,
reasonably attorney fees and costs, as the Landlord may have been put in
re-entering and repossessing the same and in making such repairs and alterations
as may be necessary; and second to the payment of the rents due hereunder. The
Tenant shall remain liable for such rents as may be in arrears and also the
rents as may accrued subsequent to the re-entry by the Landlord, to the extent
of the difference between the rents reserved hereunder and the rents, if any,
received by the Landlord during the remainder of the unexpired term hereof,
after deducting the aforementioned expenses, fees and costs; the same to be paid
as such deficiencies arise and are ascertained each month.
(b) Additionally, in the event of default as defined in Section 25
and the requisite notice and cure period under Section 27 of this Lease, and
Tenant's failure to cure said default within the time period provided therefor,
Landlord shall have the right but not the obligation upon giving five (5) days
notice in writing to Tenant, to declare the Lease and the term hereof at an end
on the date fixed in such notice as if such date were the originally fixed
expiration date of the term of this Lease and Landlord shall then have the right
to remove all persons, goods, fixtures, and chattels from the Demised Premises
without liability for damages.
(c) In case of any such default, re-entry, expiration and/or
dispossess by summary proceedings or otherwise: (1) The rent shall become due
thereupon and be paid to the time of such re-entry, dispossess and/or
expiration, together with such expenses as Landlord may incur for legal
expenses, attorneys' fees, brokerage and/or putting the Demised Premises in good
order, or for preparing the same for re-letting provided Tenant shall not be
responsible for brokerage commissions paid for re-lettings extending beyond the
original term of this Lease; (2) The Landlord may re-let the Demised Premises or
any part or parts thereof, either in the name of Landlord or otherwise, for a
term or terms which may, at Landlord's option, be less than or exceed the period
which would otherwise have constituted the balance of the term and may grant
concessions or free rent; and (3) Tenant or the legal representatives of Tenant
shall also pay Landlord as liquidated damages for the failure of Tenant to
observe and perform said Tenant's covenants herein contained, the deficiency
between the rent hereby reserved and/or covenanted to be paid and the net
amount, if any, of the rents collected on account of the Lease or Leases of the
Demised Premises for each month of the period which would otherwise have
constituted the balance of the term. When computing such liquidated damages
there shall be added to the said deficiency such expenses as Landlord may incur
in connection with re-letting, such as legal expenses, attorneys' fees,
brokerage fees, and for keeping the Demised Premises in good order or for
preparing the same for re-letting provided Tenant shall not be responsible for
brokerage commissions paid for re-lettings extending beyond the original term of
this Lease. Any such liquidated damages shall be paid in monthly installments by
Tenant on the rent day specified in this Lease and any suit brought to
12
collect the amount of the deficiency for any month shall not prejudice in any
way the rights of Landlord to collect the deficiency for any subsequent month by
a similar proceeding.
(d) In the event of a breach or threatened breach by Tenant of any
of the covenants or provisions of this Lease, Landlord shall have the right of
injunction and the right to invoke any remedy allowed at law or in equity as if
re-entry, summary proceedings and other remedies were not herein provided for.
Mention in this Lease of any particular remedy shall not preclude Landlord from
any other remedy in law or in equity.
No receipt of rent by Landlord from Tenant after the
termination of this lease or after giving any notice shall reinstate, continue
or extend the term of this Lease. No receipt of rent after the commencement of
suit, or after final judgment for possession of the Demised Premises shall
reinstate, continue or extend the term, or affect the suit of said judgment.
For purposes of this Section, the term Tenant shall also include any
Guarantor of Tenant and any obligations, duties or covenants of Tenant in this
Section which extend to any Guarantor of this Lease in addition to the Tenant.
29. CERTIFICATE OF LEASE STATUS. Tenant and Landlord shall at any time
upon ten (10) days prior written notice, execute, acknowledge and deliver to the
requesting party, in recordable form a certificate certifying that this Lease is
unmodified and in full force and effect as modified, setting forth the
modifications and the dates to which the rent and other additonal charges
required to be paid hereunder have been paid. Such certificate shall state
whether or not the requesting party is in default under this Lease and any
setoffs or defenses against the enforcement of this Lease of any nature
whatsoever that the certifying party may possess. Such certificate shall be in
such form that may be relied upon by Landlord, Tenant by any prospective
purchaser of the fee or any other interest therein or any mortgagee thereof or
any assignee of any mortgage of the fee of the Demised Premises or any of
Landlord's or Tenant's respective successors or assigns.
30. LANDLORD'S LIEN. All tangible personal property not permanently part
of the Demised Premises, including screens, sound systems, projectors, seating,
panelling, movable partitions, lighting fixtures, furniture system, storage
walls, special cabinet work, other business and trade fixtures, machinery and
equipment, communications equipment and office equipment, whether or not the
attached to, or built into, the Demised Premises, that are installed in the
Demised Premises by or for the account of Tenant, at Tenant's expense, and can
be removed without permanent structural damage to the Demised Premises, and all
furniture, furnishings and other articles of movable personal property owned by
Tenant and located in the Demised Premises (all of which are sometimes called
"Tenant's Property"), shall be and shall remain the property of Tenant for all
purposes, subject to a lien in the favor of Landlord in the event Tenant shall
default (after notice and grace) in the observance of Tenant's obligations
hereunder. Landlord's lien, however, shall be subject and subordinate to the
lien of any party which may now or in the future hold an interest in any of
Tenant's Property. This subordination shall be self-operative; however, Landlord
agrees to execute such documents as may be requested by Tenant to confirm the
subordination of its lien to the lien of any party claiming an interest, whether
by lease, financing or otherwise. In the event of damage or destruction thereto
by fire or other causes, Tenant shall have the right to recover the value
thereof as its own loss from any insurance company with which it has insured the
same, or to claim an award in the event of condemnation, notwithstanding that,
absent this sentence, any of such things might be considered a part of the
Demised Premises. Tenant may remove all or any of Tenant's Property at any time
during the term of this Lease, provided that, if any of Tenant's Property is
removed, Tenant or any party or person entitled to remove same shall repair or
pay the cost repairing any damage to the Demised Premises or to the Building
resulting from such removal. Any equipment or other property for which Landlord
shall have granted any allowance or credit to Tenant, or that has replaced such
items originally provided by Landlord at Landlord's expense, shall remain on the
Demised Premises and shall not be removed by Tenant.
13
31. SIGNS. Any signs required by Tenant shall be erected by Tenant at its
sole cost and expense, provided that it shall first have obtained Landlord's
consent as to location, size, and content thereto in writing, which shall not be
unreasonably withheld or delayed. The Tenant may remove such sign or signs at
the expiration of the term of this Lease, or any extension thereof, provided
Tenant repairs any damage caused by such removal. Tenant agrees to comply with
all State and local regualtions pertaining thereto.
32. PARKING AND MAINTENANCE OF PARKING AREA. Throughout the terms and
extensions thereof, parking facilities as shown on the site plan attached hereto
and as may be modified or altered (so long as lawful and not substantially
reduced or relocated to Tenant's detriment) from time to time, shall be provided
by the Landlord for the Tenant, its servants, agents, employees, invitees, and
patrons in connection with those of other tenants, without charge to any of
them, and the same shall be operated and maintained by the Landlord in safe and
legal condition.
Tenant and its employees shall park their cars only in those
portions of the parking area reasonably designated for the purposes by Landlord
reasonably close to the Demised Premises. In the event that Tenant or its
employees fail to park their cars in designated parking areas as aforesaid, then
Landlord shall have the right to charge Tenant ten dollars ($10.00) per day, per
car parked in any other areas than those designated. The Landlord shall require
all tenants of said Shopping Center and employees to park their motor vehicles
in the parking area provided for same, and the Landlord shall take all
reasonable measures to enforce this restriction. Tenant shall inform all of its
employees of said requirement.
The spaces, parking and other areas, passageways and all means of
access thereto, and the Demised Premises, including adjacent and surrounding
sidewalks, shall be kept by the Landlord clean and free and clear of
encumbrances, obstructions, debris and snow.
The Landlord assumes all duties, responsibilities and liabilities in
regard to maintenance, repairs, replacement, operation, supervision, use and
control of and to said spaces, parking areas, passageways, sidewalk repairs,
entrances, exits, cuts in curbing, lighting facilities, landscaped and other
exterior areas, and shall comply with all present and future laws, ordinances,
orders, rules, regulations, notices, notices of violations and requirements of
public authorities, applicable thereto.
33. COMPLIANCE WITH MORTGAGE REQUIREMENTS. As a condition of this Lease
Agreement, Tenant agrees to deliver to Landlord forms, certificates or
applications fully completed and properly executed in a timely manner, as may be
reasonably required from time to time by Landlord's institutional mortgagee
provided none of the same increase any of Tenant's obligations or diminish any
of Tenant's rights hereunder.
34. RULES AND REGULATIONS. Landlord shall have the right to promulgate
reasonable rules and regulations applicable to all tenants at the Premises from
time to time, which rules and regulations shall be deemed covenants of this
Lease to be undertaken by Tenant provided the same do not reduce Tenant's rights
or increase Tenant's obligations hereunder.
35. HEADINGS. The headings contained in the body of this Lease Agreement
are for the purposes of identification only, and are not a part of the agreement
between the parties.
36. COMPLIANCE WITH LAWS. Tenant agrees to comply with all Municipal,
County, State and Federal laws, rules, regulations, ordinances, or orders, and
all rules, orders, regulations or requirements of the Board of Fire Underwriters
or other similar body having jurisdiction pertaining to the Demised Premises and
the manner in which the Tenant conducts its business therein, whether such
compliance with respect to the manner in which Tenant conducts its business is
required within the Demised Premises or on Landlord's Property. Landlord shall
comply with all of the foregoing to the extent the same pertain to the Shopping
Center. In no event shall Tenant be required to comply with any laws, rules,
regulations, ordinances or orders described herein to the extent the same
relates to any structural alterations or repairs to the Existing Premises or any
alterations
14
or repairs necessitated by the acts or negligence of Landlord or its agents,
employees or contractors.
Tenant shall have the right to contest the validity of any
violations of any law, rule, regulations, ordinance or order as aforesaid, and
to defer compliance pending such contest if non-compliance therewith shall not
constitute a crime and is not a hazardous condition, and if compliance is so
deferred, the deferment shall not be deemed a breach of this covenant, provided
any such contest proceedings shall be prosecuted diligently and in good faith.
Tenant hereby agrees to indemnify and save Landlord harmless from and against
any and all claims, costs, expenses and liabilities, including but not limited
to reasonable attorneys' fees incurred by Landlord by reason of any such
deferment or contest.
37. FORCE MAJEURE. All performances, undertakings, or obligations of
Landlord hereunder shall be subject to force majeure, and all times set forth
herein for compliance with any of the above shall be extended due to
catastrophe, accident, weather, storms, acts of war and insurrection,
availability of materials, strikes, embargoes, or other conditions beyond
Landlord's control
38. PERFORMANCE OF TENANT'S OBLIGATIONS. If the Tenant shall be in default
as defined in Section 25 (b), and fail to cure said default after the notice and
expiration of applicable time period set forth in Section 27 hereof, then the
Landlord may cure such default on behalf of the Tenant, in which event the
Tenant shall reimburse the Landlord for all sums paid to effect such cure,
together with interest at the rate of twelve percent (12%) per annum and
reasonable attorneys' fees. In order to collect such reimbursement, the Landlord
shall have all the remedies available under this Lease for a default in the
payment of rent.
39. WAIVER. The failure of the Landlord to enforce against the Tenant any
provision, covenant, or condition, by reason of the Tenant committing any breach
of or defualt under this Lease, shall not be deemed a waiver thereof, nor void
or affect the right of the Landlord to enforce the same covenant or condition on
the occasion of any subsequent breach default thereof; nor shall the failure of
the Landlord to exercise any right in this Lease on any occasion arising
therefore be deemed or construed to be a waiver of the right to exercise the
same kind of right upon any subsequent occasion.
40. EXECUTION. This Lease is not binding upon the Landlord or the Tenant
until it is signed and sealed by duly authorized officers of the Landlord and
the Tenant and delivered to the Landlord and to the Tenant.
41. COMMISSION. Landlord and Tenant represent that each party, for itself,
has dealt with no real estate broker with regards to this Lease.
42. ADDITIONAL REMEDIES. Any remedies specifically provided for in this
Lease, or in addition to and not exclusive of any other remedy available to the
Tenant or the Landlord under applicable law. Any measure or damages provided for
in this Lease shall not be deemed to limit or prejudice the Tenant's or
Landlord's right to prove and obtain all the damages which it may sustain as a
result of any and all breaches of this Lease.
43. NOTICES. All notices, statements, demands, consents, approvals,
authorizations, offers, agreements, appointments or designations herein by
either party to the other shall be deemed to be given to the other shall be
deemed to be given to the other party for the purpose of this Lease ONLY IF IN
WRITING, and either personally served thereon or sent by CERTIFIED MAIL, Return
Receipt Requested, with postage prepaid and subsequently received, and addressed
as follows:
TO THE LANDLORD: FIRST ROXBURY COMPANY
241-A Millburn Ave.
Millburn, N.J. 07041
15
TO THE TENANT: ROXBURY CINEMA INC.
21 Sunset Strip
Roxbury Mall
Rt. 10
Succasunna, N.J.
IF TO TENANT,
WITH A COPY TO: ARTHUR S. MANTEL, ESQ.
Dreyer and Traub
101 Park Avenue
New York, New York 10178
or such substituted parties or addresses, provided such change of address and
party is provided in writing during the term of this Lease.
If so served or sent, any such matter shall be deemed given on the date same is
personally delivered, or if mailed, on the third day after depositing same in a
post office box regularly maintained by the U.S. Post Office Department.
44. BINDING EFFECT. This Lease shall be binding upon and inure to the
benefit of the parties hereto and their respective successors, representatives
and assigns. Each individual executing this Lease on behalf of the respective
parties hereto hereby represents to the other party that such individual is
authorized to execute this Lease on behalf of the party for whom such individual
is executing the same.
45. SEVERABILITY. If any provision of this Lease shall be declared invalid
or unenforceable, the remainder of this Lease shall continue in full force and
effect.
46. SUPERCESSION. As of the Commencement Date, this Lease shall supercede
the Prior Lease. However, the Prior Lease shall remain in full force and effect
until the Commencement Date. In the event this Lease is terminated in accordance
with the terms of this Lease other than pursuant to Sections 18 (Casualty) or 22
(Condemnation) hereof, whether before or after the Commencement Date, then the
Prior Lease shall remain in full force and effect in accordance with its terms.
47. DEFINITION OF LANDLORD - LIABILITY OF LANDLORD.
The term "Landlord" as used in this Lease means only the owner or the
mortgagee in possession for the time being of the Shopping Center in which the
Demised Premises are located or the holder of a lease of both said Shopping
Center and the land thereunder so that in the event of any sale of said Shopping
Center or an assignment of this Lease or any underlying lease or a demise of
both said Shopping Center and land, except for the payment of the "Alteration
Fund" to Tenant in accordance with Section 51 hereof Landlord shall be and
hereby is entirely freed and relieved of all obligations of Landlord hereunder
and it shall be deemed without further agreement between the parties and such
purchaser(s), assignee(s) or lessee(s) that the purchaser, assignee or lessee
has assumed and agreed to observe and perform all obligations of Landlord
thereafter accuring hereunder. Nothwithstanding any transfer of the Shopping
Center by Landlord and/or assumption of such obligation by the successor
Landlord, Tenant shall be entitled to seek payment of the Alteration Fund from
the original named Landlord hereunder in the event any successor Landlord shall
fail to pay the same. The provisions of the preceding sentence shall be
applicable to any successor Landlord. Except for the payment of the "Alteration
Fund" (as hereinafter defined) as provided in Section 51 hereof, it is
specifically understood and agreed that there shall be absolutely no personal
liability on the part of the Landlord or such mortgagee or such individual or on
the part of the members of such firm, partnership or joint venture with respect
to any of the terms, covenants and conditions of the Lease, and that Tenant
shall look solely to the equity of the Landlord or such successor in interest in
the Shopping Center and, so long as owned by Landlord, the "Adjoining Centers"
(as hereinafter defined), or the Leasehold estate of Landlord or such successor
in the Shopping Center and, so long as owned by Landlord, the Adjoining Centers,
or the rents, issues, profits or proceeds of the Shopping Center or Adjoining
Centers for the satisfaction of each and every remedy of Tenant in the event of
any breach by Landlord or by such successor in interest of any of the terms,
covenants and conditions of this Lease to be performed by Landlord, such
exculpation of personal liability to be absolute and without any exception
whatsoever.
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48. ECRA COMPLIANCE. Except to the extent caused by Tenant and subject to
Tenant's representations in this Section 48, Landlord represents that to the
best of its knowledge, the Demised Premises are not currently subject to
compliance with "ECRA" (as hereinafter defined) nor are the Demised Premises
subject to the terms of the New Jersey Spill Act and Landlord will indemnify
Tenant against any liability, loss, cost or expenses (including attorney's fees
or expenses) which Tenant may sustain or incur by reason of Landlord's failure
to comply with the Spill Act or ECRA. Tenant has not and shall not use or suffer
the premises to be used in any manner as to create or cause an environmental
violation or hazard. Not in limitation of the generality of the above, it is
understood that Tenant shall not cause or suffer to be caused any chemical
contamination or discharge of substance of any nature which is noxious,
offensive or harmful or which, under any law rule or regulation of any
governmental authority having jurisdiction, constitutes a hazardous substance or
hazardous waste. As addtional covenants by Tenant, it is specifically agreed
that Tenant shall not generate, manufacture, refine, transport, treat, store,
handle, dispose or otherwise deal with any hazardous substances or hazardous
waste as presently or in the future defined in the Environmental Cleanup
Responsibility Act of New Jersey (N.J.S.A. 13:1K-6 et seq.) ("ECRA") (the
generation, manufacture, refinement, transportation, treatment, storage,
handling, disposition and/or otherwise dealing with such substance or waste, as
the case may be, being referred to for convenience as "dealing with" such
substances or waste).
49. RESTRICTIVE COVENANT. Landlord covenants not to lease any other space
in the Shopping Center or tax lots 23.1 and 23.5 in Block 45 of the Township of
Roxbury (the "Adjoining Centers"), which are immediately adjoining to the
Shopping Center and owned by Landlord, to be used for the operation of a movie
theatre. The provisions of this Section 49 shall be binding on the successors
and assigns of Landlord with respect to the Shopping Center and Adjoining
Centers. In the event a proposed sale of the Adjoining Centers Landlord shall
(i) give Tenant at least ten (10) days prior written notice of such sale; (ii)
notify the prospective purchaser of the provisions of this Section 49 and (iii)
at Tenant's request, record a memorandum in the appropriate recording office
containing the provisions of this Section 49 and such other provisions of this
Lease which may be appropriate, failing which Tenant may do so.
50. LEASE CONDITIONAL: (a) The effectiveness of this Lease Agreement is
conditional upon the satisfaction of the following contingencies within (180)
days of the date hereof. In the event any or all of the following contingencies
shall not have been satisfied within said (180) days period, Tenant may
terminate this Lease by written notice to Landlord and the Prior Lease shall
remain in full force and effect.
(i) Approval by all existing mortgagees of this Agreement (without
imposition of any cost, fee or other expense) and execution and delivery of the
Non-Disturbance Agreements from such mortgagees;
(ii) Landlord obtaining a special water and sewer permit from the
New Jersey State of Environmental Protection and such other permits which may be
required to enable Tenant to obtain a building permit for the construction of
the Addition provided Tenant complies with the conditions for obtaining said
building permit.
(iii) The securing by Landlord of financing to fund the Alteration
Fund (the "Financing") refrenced hereafter it being understood that such
financing may be included within additional financing being secured by Landord
with respect to the Shopping Center and the Adjoining Centers. Landlord agrees
to promptly deliver to Tenant copies of proposed commitment letters or their
equivalent from proposed lenders as well as copies of fully executed commitments
relating to such financing and much other documents or information as Tenant may
reasonably request with respect to same. Tenant shall have the right to waive
this condition if Tenant secures its own financing to fund Tenant's Work as
provided in Paragraph 51(g) hereafter. The Financing shall be subject to the
requirement that such lenders execute and deliver Non-Disturbance Agreements.
(b) This Lease is further contingent upon Tenant obtaining
approval by the Landlord of detailed plans and specifications for the Addition,
including approval by Landlord of proposed applications for governmental
approvals, which
17
approvals shall not be unreasonably withheld or delayed. In the event such
approval is not obtained within ninety (90) days after the satisfaction of the
last of the conditions set forth in Section 50(a) above, Tenant shall have the
option to cancel this Lease and the Prior Lease shall remain in full force and
effect.
(c) Tenant shall have the right to waive any of the conditions
set forth in this Section 50.
(d) In addition to the Tenant's right to terminate this Lease
as herein provided, Landlord shall have the right to terminate this Lease upon
written notice to Tenant in the event Landlord shall be unable to obtain the
Financing within one hundred and eighty (180) days from the date hereof.
51. ALTERATION FUND: In connection with the construction of the Addition
in conformity with this Agreement, Landlord agrees to disburse to the Tenant the
sum of SEVEN HUNDRED AND FORTY THOUSAND ($740,000) as hereinafter provided (the
"Alteration Fund"). However, in the event that the actual construction costs,
direct or indirect, shall exceed the sum of $740,000.00, Landlord's obligation
shall only be to disburse the sum of $740,000.00 and same shall have satisfied
its obligation pursuant to this Agreement. The Landlord's obligation to disburse
the Alteration Fund to Tenant shall not be subject to the limitation of
liability set forth in Section 47 hereof.
(a) The Tenant shall be responsible for the entire cost of
construction of the Addition, whether direct or indirect, and irrespective of
whether such cost shall exceed the disbursement of $740,000.00 to be made by the
Landlord.
(b) Without limiting the generality of the Tenant's obligation
as to the construction of the Addition, the Tenant shall be responsible for all
labor, materials, equipment, tools, machinery, utilities, transportation,
engineering costs, insurance, permits and approvals, and any sales, consumer or
use taxes regarding the materials used in the Addition. The work, services,
materials and fees to be obtained and performed by Tenant in connection with the
Addition are hereinafter collectively referred to as "Tenant's Work".
(c) The Alteration Fund shall be disbursed by Landlord to
Tenant in the following manner and subject to the following conditions:
(i) Tenant may submit to Landlord monthly:
(x) Invoices for all work performed and all
materials furnished in connection with such
work performed or materials installed in the
Demised Premises including payment of
architect and contractor fees to the date of
such invoices;
(y) a certificate from Tenant's architect
approving payment.
(ii) On or before the first day of each calendar
month after the Commencement Date, Tenant may
submit to Landlord with respect to portions of
Tenant's Work completed for a preceding calendar
month for which Landlord has not paid Tenant a
"Construction Payment" (as hereinafter defined) (a
"Monthly Reimbursement Submission"), a request for
payment of the items set forth in subparagraph (i)
hereof and, on or before the twentieth (20th) day
after the submission of such Monthly Reimbursement
Submission, Landlord shall pay to Tenant ninety
(90%) percent of the amount of the completed work
reflected in such Monthly Reimbursement Submission
(a "Construction Payment"), until seventy-five
(75%) percent of the Tenant's Work has been
completed and thereafter ninety five (95%) percent
of Tenant's Work completed. The retained amounts
shall be paid to Tenant within fifteen (15) days
after the submission to Landlord of a certificate
of occupancy (temporary or permanent) for the
Addition from the governmental or
quasi-governmental bodies having jurisdiction
thereof.
18
(d) From and after the date that Landlord shall disburse any
portion of the Alteration Fund to Tenant as hereinabove provided, Tenant shall
pay monthly installments of interest only to Landlord (the "Interest Payment")
on the disbursed portion of the Alteration Fund at the rate of interest actually
being charged to Landlord pursuant to the Financing. Such interest payments
shall be made by Tenant to Landlord beginning on the first day of the first
calendar month immediately succeeding the first Construction Payment by Landlord
and shall be payable on the first day of each and every calendar month
thereafter until the Rent Commencement Date. From and after the Rent
Commencement Date, Tenant shall not be required to make any further Interest
Payments to Landlord. The amount of the Interest Payment shall be prorated to
reflect any portion of a month and shall be recomputed following every
Construction Payment made by Landlord.
(e) In the event Landlord shall fail to make any Construction
Payment as required hereunder, Tenant, at its option, may deduct the same from
any Interest Payment, fixed minimum rent or additional rent becoming due under
this Lease or the Prior Lease together with interest of the rate of thirteen
(13%) percent per year from the date such Construction Payment was due and
payable.
(f) Tenant hereby guarantees completion of Tenant's Work
subject to Landlord's funding of the Alteration Fund as aforesaid.
(g) Notwithstanding anything to the contrary set forth in
Paragraph 51 hereof, Tenant shall have the right not to utilize the Alteration
Fund and in lieu thereof may secure its own financing for Tenant's Work ("Tenant
Financing"). In the event Tenant secures Tenant Financing:
(i) The provisions of Paragraph 51(a) thru (f)
shall be inapplicable; and
(ii) Landlord shall deliver to Tenant a take-out
commitment in the sum of $740,000.00 being in form and substance and being from
a lending institution reasonably acceptable to Tenant and the lender funding the
Tenant Financing.
52. CONSTRUCTION CONDITIONS. Tenant's construction of the Addition
shall be subject to all of the terms, conditions and affirmative obligations
contained in this Section:
(a) The work shall be performed in a good and workmanlike
manner, in conformity with the plans and specification approved by the Landlord
in accordance with all laws, rules and regualtions of all governmental entities
having jurisdiction and in conformity with all plans, specifications, conditions
and other requirments of all such governmental agencies.
(b) Tenant shall procure, prior to commencement of
construction, for the benefit and in the name of the Landlord, a performance
bond with regard to the construction of the Addition.
(c) The general contractor, prime contractors and independent
contractors employed by the Tenant and any subcontractors and materialmen
(collectively "Contractors") shall be reasonably acceptable to the Landlord. All
such contracts with Contractors shall be reasonably acceptable to the Landlord.
Landlord shall be deemed to have consented to any request for Landlord's consent
to which Landlord does not specifically object within seven (7) days. All such
contracts shall be in the name of the Tenant, and the Landlord shall have no
liability with regard thereto; however, all such contracts shall have a
provision permitting the assignment by the Tenant to the Landlord. Without
limiting the general nature of the foregoing, agreements with contractors shall
contain a warranty for a period of at least one (1) year from the date of
completion of construction to the extent commercially available.
(d) The plans and specifications and all modification thereto
for the construction of the Addition must be approved in writing, in advance, by
the Landlord, which approval shall not be unreasonably withheld or delayed.
Landlord shall be deemed
19
to have consented to any request for Landlord's consent to which Landlord does
not specifically object within seven (7) days. To the extent that Tenant's plans
and specifications are consistent with the Tenant's proposal for the Addition
and entire Demised Premises, as set forth on Exhibits "B" and "C" annexed hereto
and made a part hereof, the same shall be deemed approved.
(e) No mechanics liens, stop notices, Uniform Commercial Code
financing statements, or any other lien or encumbrance may be placed upon the
Shopping Center or any part thereof by the Tenant or the Contractors, but the
same shall not be deemed a default under this Lease provided Tenant shall
discharge or bond the same within thirty (30) days.
(f) At all times during the construction, the Lease shall be
in good standing.
(g) Deleted prior to execution.
(h) Tenant shall take out and maintain at its sole cost and
expense or cause its Contractors to take out and maintain during the period of
construction the following insurance in the following minimum amounts:
(1) Adequate workmen's compensation and employers'
liability insurance for all employees employed in connection with the work.
Employers' insurance shall have limits not less than $100,000.00 per claim.
(2) Owner's liability insurance in the following
amounts:
BODILY INJURY AND PROPERTY DAMAGE
$5,000,000/occurance and $5,000,000 aggregate
(3) Contractors' liability insurance covering
bodily injury liability including death, protective, completed operations and
building operation and property damage liability in the following amounts:
BODILY INJURY AND PROPERTY DAMAGE
$5,000,000/occurance and $5,000,000 aggregate
(4) Motor vehicle liability insurance covering
bodily injury including death, and including non-owned and hired cars in the
following amounts:
BODILY INJURY AND PROPERTY DAMAGE
$5,000,000/occurance and $5,000,000 aggregate
(5) Fire and casualty insurance during the course
of construction, including special extended coverage, malicious and wind storm
damage to the full insurable value of the work regarding the Addition and any
damage to the existing Building arising from the work. If any work is sublet,
insurance of the same types, where applicable, and limits shall be provided for
by the Contractors. Property damage shall be extended to cover damage to
underground wires, pipes, ducts, conduites and installations. The policies shall
remain in force until all work has been completed, and Certificate of Occupany
delivered pursuant to the terms of this Contract and the Architect's Final
Certificate delivered. Thereafter, insurance as to the Addition shall be
governed by Article 11 of the Lease.
Each insurance policy shall include the Tenant and Landlord as insured
parties and provide that the Landlord shall be given at least ten (10) days'
prior notice before any amendment or cancellation of such policy or reduction of
coverage thereunder can be effective. All Contractors shall furnish certificates
of insurance coverage in the amounts and kinds specified as above, and it will
be the responsibility of the Tenant to promptly accumulate such certificates and
forward them to the Landlord. Landlord shall have not responsibility for
Tenant's acts or omissions or for those of the Contractors.
20
(i) The Tenant shall employ an independent architect
reasonably acceptable to Landlord to supervise the progress of construction and
conformity of construction to the plans and specifications, on behalf of Tenant,
and to issue reports, written or oral to the Tenant and the Landlord regarding
same.
(j) The Tenant shall be responsible to the Landlord for the
acts and omissions of Tenant's employees, Contractors, and their agents and
employees, and all other persons performing any of the work and shall indemnify
and hold Landlord harmless for its acts and omissions and those of its
contractors and such subcontractors.
(k) To the fullest extent permitted by law, the Tenant shall
indemnify and hold harmless the Landlord from and against any and all claims,
damages, losses and expenses, including, but not limited to reasonable
attorneys' fees, arising out of or resulting form the performance of the work.
(l) The Tenant shall take or cause to be taken all necessary
precautions for the safety of, and shall provide all reasonable protection to
prevent damage, injury or loss to any of the following:
(1) All employees on the work and all other persons
who may be affected thereby;
(2) All of the work and all materials and equipment
to be incorporated therein, whether in storage on or off the site; and
(3) Other property at the site or adjacent thereto,
including the Building, common areas of the Shopping Center, existing
utilities, and the like.
(m) The Tenant acknowledges that it and its architect, and
engineers and consultants solely shall be responsible for determining the
feasibility of constructing the Addition, performing connection and integration
of the Addition to the Building, determining subsurface conditions, and all
other aspects relating to the feasibility of the construction. In the event that
Tenant shall determine that it is not feasible to construct the Addition due to
subsurface conditions, Tenant may cancel this Lease and the Prior Lease shall
remain in full force and effect.
(n) To the extent practicable and lawful, Tenant agrees that
it shall continue its normal business operations at the Building during the
period of construction.
(o) At all times during the construction of the Addition,
Tenant shall keep clear the Demised Premises, inside and outside, as well as all
adjoining sidewalks, walkways and alleyways free of all obstructions and refuse.
53. PERCENTAGE RENT. In addition to the fixed minimum annual rent, Tenant
agrees to pay as additional rent a sum equal to three (3%) percent of the gross
sales in excess of the amount hereinafter set forth for each Lease Year (which
amounts are hereinafter referred to as the "Overage Amount"). Said sum being
herein sometimes referred to as "Percentage Rent" shall be three (3%) percent of
gross sales in excess of gross sales of $1,400,000.00 per Lease Year for Lease
Years 1-5; $1,522,500 per Lease Year for Lease Years 6-10; $1,651,116 per Lease
Year for Lease Years 11-16; $1,786,116 per Lease Year for Lease Years 16-20;
$1,927,982 per Lease Year for Lease Years 21-25; and $2,076,865 per Lease Year
for Lease Years 26-30.
On or before the 60th day after the expiration of the first Lease year the
term of this Lease, Tenant shall submit to Landlord a statement signed by a
Certified Public Accountant showing in reasonable detail, the amount of gross
sales for the Demised Premises during the preceding Lease year. If Percentage
Rent shall be payable with respect to the preceding Lease year the amount of
such Percentage Rent due to Landlord shall be paid over to Landlord at such time
as the redemption of said statement. Each Lease Year during the term shall be
considered as an independent accounting period for the purposes of computing and
determining the amount of Percentage Rent, if any, payable hereunder. The amount
of gross sales in any Lease Year shall not be carried over into any other Lease
Year. The term "Gross Sales" is the entire amount of actual sales
21
price, whether wholly or part for cash or otherwise, actually received by Tenant
from the box office receipts of the movie theatre plus the proceeds actually
received by Tenant pursuant to any 4-Wall Deal after deducting any and all sales
and excise taxes or any other similar taxes required to be paid to any
governmental authority (local, city, county, state, federal or otherwise). Gross
Sales, as used herein, shall not include any proceeds received from the sale of
food, beverages or other concessions and shall also not include any discounts or
promotions to the extent Tenant does not receive monetary compensation therefor.
Tenant shall and hereby agrees to keep in the Premises during the term
hereof, or at a location made known to Landlord by Tenant, for a period of three
(3) consecutive years following the end of each Lease Year a permanent and
complete and accurate record of all Gross Sales (as heretofore defined) and all
revenue derived form the business conducted in the Premises for such Lease Year.
Tenant further agrees to keep and retain and preserve for at least two (2) years
after the expiration of such Lease Year all original sales records and sales
slips or sales checks or other pertinent original sales records. Accurate and
non-resetable cash registers or other modern systems shall be installed or kept
or caused to be installed or kept by Tenant within the Demised Premises, which
shall show, record and preserve, in complete detail, all items making up Gross
Sales as herein above defined. Tenant shall also submit to Landlord on or before
the sixtieth (60th) day following the end of the Tenant's fiscal year at
Tenant's offices, a complete statement made and certified (based upon the
information supplied to the CPA by the Tenant) by a Certified Public Accountant
and also certified by a duly authorized officer of Tenant showing accurately, in
reasonable detail the amount of Gross Sales made by the Tenant, its sublessees,
concessionaires, or licensees, if any, upon and within the Demised Premises
during the preceding Lease Year or fractional Lease Year, if any, and shall
submit on or before the sixtieth (60th) day following the expiration or
termination of the term, a like statement, covering the preceding Lease Year or
fractional Lease Year, if any.
The receipt by Landlord of any statement or any payment of Percentage Rent
for any period or failure of Landlord to make any audits for said period shall
not bind Landlord as to the correctness of the statement or the payment, nor bar
Landlord from collecting at any time thereafter, Percentage Rent due for said
period. If any audit by the Landlord or its agents, of Tenant's records reveal a
deficit in any payment of Percentage Rent, Tenant shall forthwith pay to
Landlord the amount of deficit, and if such deficit exceeds five (5%) percent,
Tenant shall also pay interest at the rate of twelve (12%) percent per annum
from the date of which said payment should have been made, together with all
reasonable costs of such audit. Landlord agrees to keep the results of any such
audit confidential and to be bound by the results thereof. It is agreed that
nothing contained in this Lease shall be deemed or construed as a creation of a
partnership or joint venture between Landlord and Tenant, or between Landlord or
any other party, or cause Landlord to be responsible in any way for debts or
obligations of Tenant or any other party.
54. RENEWAL OPTIONS. (a) Tenant shall have the option (hereinafter
referred to as the "Renewal Options") to renew this lease for two (2) successive
renewal terms of ten (10) years each on the terms and conditions hereinafter
contained.
Tenant shall exercise the applicable renewal option by sending written
notice thereof (each of which notices is hereinafter referred to as a "Renewal
Notice") to Landlord by certified mail, return receipt requested, on or before
the day which shall be twelve (12) months next preceding last day of the
original term of this lease or the last day of the first renewal term, as the
case may be. If Tenant shall send a Renewal Notice within the time and in the
manner hereinbefore provided, this Lease shall be deemed renewed for the
applicable renewal term (hereinafter collectively referred to as the "Renewal
Terms") upon the terms, covenants and conditions hereinafter contained.
(b) The Renewal Terms, if any, shall be upon, and subject to, all of
the terms, covenants and conditions provided in this Lease for the original term
hereof, except that:
(i) Any terms, covenants, or conditions hereof that are
expressly or by their nature inapplicable to the Renewal Terms or either of them
(including, without limitation, Articles 50, 51 and 52 hereof) shall not apply
during the Renewal Terms;
22
(ii) The annual fixed rent payable by Tenant during each
Renewal Term (hereinafter referred to as the "Renewal Rent"), subject to
adjustment as otherwise in this Lease provided, shall be an amount equal to the
fair market rental value of the Demised Premises, to be determined as provided
in Section 54(c) hereof and to be calculated as of the "Determination Date" (as
defined in Section 54(c)) on the basis of a new ten (10) year letting of the
Demised Premises;
(c) In the event that Tenant shall exercise either or both renewal
options as provided in Section 54 (a) hereof, the Renewal Rent for each renewal
term shall be determined jointly by Landlord and Tenant, and such determination
shall be confirmed in a writing (hereinafter referred to as a "Rental
Agreement") to be executed by Landlord and Tenant not later than the day
(hereinafter referred to as the "Determination Date") which shall be ninety (90)
days next preceeding the expiration of the original term of this Lease or the
expiration of the first renewal term as the case may be. In the event that
Landlord and Tenant shall have failed to join in executing a Rental Agreement on
or before the Determination Date because of their failure to agree upon the
Renewal Rent then the Renewal Rent shall be determined by arbitration as
follows:
(i) Landlord and Tenant shall each appoint an arbitrator by
written notice given to the other party hereto not later than thirty (30) days
after the Determination Date. If either Landlord or Tenant shall have failed to
appoint an arbitrator within such period of time and thereafter shall have
failed to do so by written notice given within a period of five (5) days after
notice by the other party requesting the appointment of such arbitrator, then
such arbitrator shall be appointed by the American Arbitration Association or
its successor (the branch office of which is located in or closest to the
Township of Roxbury, State of New Jersey, upon request of either Landlord or
Tenant, as the case may be;
(ii) The two (2) arbitrators appointed as above provided shall
attempt to reach an agreement as to the Renewal Rent and in the event they are
unable to do so within thirty (30) days after their joint appointment, then they
shall appoint a third (3rd) arbitrator by written notice given to both Landlord
and Tenant, and, if they fail to do so by written notice given within sixty (60)
days after their appointment, such third (3rd) arbitrator shall be appointed as
above provided for the appointment of an arbitrator in the event either party
fails to do so;
(iii) All of such arbitrators shall be M.A.I. or S.R.E.A.
appraisers having not less than ten (10) years experience in appraising the
value of leasehold interests in real estate similar to the Demised Premises;
(iv) The three arbitrators, selected as aforesaid, forthwith
shall convene and render their decision in accordance with the then applicable
rules of the American Arbitration Association or its successor, which decision
shall be strictly limited to a determination of the Renewal Rent within twenty
(20) days after the appointment of the third (3rd) arbitrator. The decision of
such arbitrators shall be in writing and the vote of the majority of them shall
be the decision of all and, insofar as the same is in compliance with the
provisions and conditions of this Section 54(c) hereof shall be binding upon
Landlord and Tenant. Duplicate original counterparts of such decision shall be
sent forthwith by the arbitrators by certified mail, return receipt requested,
to both Landlord and Tenant. If, for any reason whatsoever, a written decision
of the arbitrators shall not be rendered within twenty (20) days after the
appointment of the third (3rd) arbitrator, then, at any time thereafter before
such decision shall have been rendered, either party may apply to the Superior
Court of the State of New Jersey or to any other court having jurisdiction and
exercising the functions similar to those now exercised by such court, by
action, proceeding or otherwise (but not by a new arbitration proceeding) as may
be proper, to determine the question in dispute consistently with the provisions
of this lease. The cost and expense of such arbitration, action, proceeding, or
otherwise shall be borne equally by Landlord and Tenant.
23
IN WITNESS WHEREOF, the parties hereto have executed this Lease Agreement the
day and year first above written.
WITNESS LANDLORD:
FIRST ROXBURY COMPANY
/s/ Kathy Hawley By: /s/ Salvatore A. Davino
- ------------------------ ------------------------
SALVATORE A. DAVINO,
General Partner
WITNESS TENANT:
ROXBURY CINEMA INC.
/s/ Robert Ferman By: /s/ John A. Nelson
- ------------------------ ------------------------
Robert Ferman Name: John A. Nelson
Secretary Title: President
24
ACKNOWLEDGMENTS
STATE OF NEW JERSEY )
) ss.:
COUNTY OF ESSEX )
On this 24th day of May, 1989, before me personally came Salvatore A. Davino, to
me known, to be the individual who executed the foregoing instrument; and, who,
being duly sworn by me, did depose and say that he resides in 241-A Millburn
Ave., Millburn, NJ 07041; that he is a general partner of FIRST ROXBURY COMPANY;
the general partnership described in the foregoing instrument and that he
executed the same as the general partner of FIRST ROXBURY COMPANY, as the act
and deed of said partnership.
/s/ Toni L. Shaw
------------------------
Notary Public
TONY L. SHAW
NOTARY PUBLIC OF NEW JERSEY
My Commission Expires Dec. 7, 1992
STATE OF NEW YORK )
) ss.:
COUNTY OF NEW YORK )
On the 10th day of April, 1989, before me personally came John A. Nelson, to me
known, who, being by me duly sworn, did depose and say that he has an address
c/o Cinema Ten Theater, Route 10, Succasunna, New Jersey; that he is the
President of ROXBURY CINEMA INC., the corporation described in and which
executed the foregoing instrument as Tenant; and that he signed his name thereto
by order of the Board of Directors of said Corporation.
/s/ Arthur S. Mantel
------------------------
Notary Public
ARTHUR S. MANTEL
Notary Public, State of New York
No. 02-2516111
Qualified in New York County
Commission Expires June 30, 1989
EXHIBIT A
[GRAPHIC OMITTED]
EXHIBIT B
[GRAPHIC OMITTED]
EXHIBIT C
[GRAPHIC OMITTED]
LEASE MODIFICATION AGREEMENT
AGREEMENT made this 2nd day of May, 1990 between ROXVILLE ASSOCIATES, a
partnership of the State of New Jersey, having an office at 241-A Millburn
Avenue, Millburn, New Jersey 07041 (hereinafter referred to as "Landlord") and
ROXBURY CINEMA INC. (hereinafter referred to as "Tenant").
WITNESSETH:
WHEREAS, The Landlord and Tenant hereby acknowledge the execution of a
Lease Agreement dated May 24, 1989 for premises located at the Roxbury Mall
Shopping Center located on Route 10, in the Township of Roxbury, County of
Morris, State of New Jersey (hereinafter called "The Shopping Center") between
the Tenant and the prior Landlord, First Roxbury Company (hereinafter called the
"Prior Landlord") and
WHEREAS, on June 26, 1989 the Landlord purchased the Shopping Center from
the Prior Landlord; and
WHEREAS, the parties have agreed upon certain modifications to the Lease
to become effective upon the execution hereof, as hereinafter set forth.
NOW, THEREFORE, in consideration of the premises, the sum of $1.00 to each
party, in hand paid, the receipt of which is hereby acknowledged and other good
and valuable consideration, including, without limitation, the mutual covenants
herein contained, the parties hereby agree as follows:
Landlord and Tenant acknowledge that changes are required in the Lease
Agreement because of the preparation of construction plans showing the correct
dimensions of the existing premises and the additional premises. Landlord and
Tenant agree the following paragraphs, Article 1, Article 2(b), Article 6 and
Article 7, shall apply with respect to resolution of these issues.
ARTICLE 1 - The size of the Existing Premises shown as 12,388 square feet
is changed to 12,230 square feet and the size of the Additional Premises shown
as 11,478 square feet is changed to 12,288 square feet.
ARTICLE 2(b) - The second sentence from the bottom of Paragraph 2(b) is
changed to read: Landlord represents that the Demised Premises are zoned for the
operation of a theatre comprising at least 24,518 square feet, provided that
Tenant complies with the Site Plan dated July 5, 1989 and the Elevations dated
October 19, 1989 by Modular Structures Incorporated (Exhibit A) and the
resolution approved March 1, 1988 (The "Resolution") by the Board of Adjustment
of the Township of Roxbury for the construction of the Addition.
1
ARTICLE 6 - The third and fourth sentences of this article are changed to
read: The Shopping Center after the construction of the Addition will contain
61,145 total square feet of leasable space. For the purposes of this Article 6,
Tenant's pro rata share shall currently be 40.10% which has been computed by
dividing 24,518 the total leasable square foot area of the Leased Premises after
completion of the Addition, by, 61,145, the total leasable square foot area o f
the Shopping Center after construction of the Addition.
ARTICLE 7 - The second sentence in this article is changed to read:
Tenant's proportionate share of Operating Costs for the purposes of this
paragraph 7 shall mean 40.10% which has been computed by dividing 24,518, the
leasable square foot area of the Leased Premises after the completion of the
Addition, by 61,145.
IN ADDITION, in consideration of the Landlord increasing the amount of the
Alteration Fund and waiving his rights under Article 52(b), Landlord and Tenant
agree that the following changes are made to Article 4, Article 5(a), Article 51
and Article 52(b):
ARTICLE 4 - The last two lines of the third paragraph of Article 4 are
changed to: (iv) the fixed rent payable for the Short Year shall be at the rate
of $186,450.60 per year ($15,537.55 per month).
ARTICLE 5(a) - RENT SCHEDULE:
Lease Year Annually Monthly
1-5 $186,450.60 $15,537.55
6-10 193,800.60 16,150.05
11-15 201,518.10 16,793.18
16-20 209,621.47 17,468.46
21-25 218,130.01 18,177.50
26-30 226,013.98 18,834.50
ARTICLE 51 - ALTERATON FUND
In connection with the construction of the Addition in conformity with
this Agreement, Landlord agrees to disburse to the Tenant the sum of ONE MILLION
DOLLARS ($1,000,000.00) as hereinafter provided (the "Alteration Fund").
However, in the event that the actual construction costs, direct or indirect,
shall exceed the sum of $1,000,000.00, Landlord's obligation shall only be to
disburse the sum of $1,000,000.00 and same shall have satisfied its obligation
pursuant to this Agreement. The Landlord's obligation to disburse the Alteration
Fund to Tenant shall not be subject to the limitation of liability set forth in
Section 47 hereof.
(a) The Tenant shall be responsible for the entire cost of
construction of the Addition, whether direct or indirect, and irrespective of
whether such cost shall exceed the disbursement of $1,000,000.00 to be made by
the Landlord.
(b) Without limiting the generality of the Tenant's obligation as to
the construction of the Addition, the Tenant shall be responsible for all labor,
materials, equipment, tools, machinery, utilities, transportation, engineering
costs, insurance, permits and approvals, and any sales, consumer or use taxes
regarding the materials used in the Addition. The work, services, materials and
fees to be obtained and performed by Tenant in connection with the Addition are
hereinafter collectively referred to as "Tenant's Work".
2
(c) The Alteration Fund shall be disbursed by Landlord to Tenant in
the following manner and subject to the following conditions:
(i) Tenant may submit to Landlord monthly invoices for all
work performed, all materials furnished in connection with
such work performed and materials installed in the Demised
Premises, all as part of the original contract sum of
$966,500.00 between Tenant and "Modular Structures, Inc.",
(the "Contractor") less any amounts retained by Tenant from
Contractor plus any additional amounts expended but in no
event more than $1,000,000.00 in total.
(ii) On or before the tenth day of each calendar month after
the Commencement Date, Tenant may submit to Landlord with
respect to portions of Tenant's Work completed for a preceding
calendar month for which Landlord has not paid Tenant a
"Construction Payment" (as hereinafter defined) (a "Monthly
Reimbursement Submission"), a request for payment of the items
set forth in subparagraph (i) hereof and, on or before the
fifteenth (15th) day after the submission of such Monthly
Reimbursement Submission Landlord shall pay to Tenant
sixty-eight (68%) percent of the amount of the completed work
as defined in subparagraph (i) hereof, reflected in such
Monthly Reimbursement Submission (a "Construction Payment").
The retained amounts, the difference between the Alteration
Fund and the total of the Construction Payments, shall be paid
to Tenant within fifteen (15) days after the submission to
Landlord of a certificate of occupancy (temporary or
permanent) for the Addition from the Governmental or
quasi-governmental bodies having jurisdiction thereof. In no
event will the Landlord be required to pay more than
$680,000.00 prior to the obtaining of a certificate of
occupancy.
(d) From and after the date that Landlord shall disburse any portion
of the Alteration Fund to Tenant as hereinabove provided, Tenant shall pay
monthly installments of interest only to Landlord (the "Interest Payment") on
the disbursed portion of the Alteration Fund at the rate of interest actually
being charged to Landlord pursuant to the Financing. Such interest payments
shall be made by Tenant to Landlord beginning on the first day of the first
calendar month immediately succeeding the first Construction Payment by Landlord
and shall be payable on the first day of each and every calendar month
thereafter until the Rent Commencement Date. From and after the Rent
Commencement Date, Tenant shall not be required to make any further Interest
Payments to Landlord. The amount of the Interest Payment shall be prorated to
reflect any portion of a month and shall be recomputed following every
Construction Payment made by Landlord.
(e) In the event Landlord shall fail to make any Construction
Payment as required hereunder, Tenant, at its option, may deduct the same from
any Interest Payment, fixed minimum rent or additional rent becoming due under
this Lease or the Prior Lease together with interest of the rate of thirteen
(13%) percent per year from the date such Construction Payment was due and
payable.
3
(f) Tenant hereby guarantees completion of Tenant's Work subject to
Landlord's funding of the Alteration Fund as aforesaid.
(g) Deleted in its' entirety.
ARTICLE 52(b): Deleted in its's entirety.
In the event of any inconsistency between the Lease and this Modification
Agreement, the Modification Agreement shall control.
Except as herein modified, supplemented or amended, all of the terms, covenants
and conditions of the Lease shall remain in full force and effect.
IN WITNESS WHEREOF, the parties have executed this Lease Modification Agreement
the day and year first written above.
WITNESSED: LANDLORD:
/s/ Kathy Hawley By: /s/ Salvatore A. Davino
- ------------------------ -------------------------
Salvatore A. Davino for
ROXVILLE ASSOCIATES
WITNESSED: TENANT:
/s/ Robert Ferman, Sec'y By: /s/ John A. Nelson
- ------------------------- -------------------------
ROXBURY CINEMA INC.
4
12/02/94
SECOND LEASE MODIFICATION AGREEMENT
This Agreement is made this 20th day of December, 1994
BETWEEN: ROXVILLE ASSOCIATES,
with its principal place of
business at 641 Shunpike Road,
Chatham, NJ 07928 (hereinafter
referred to as "Landlord")
AND: ROXBURY CINEMA INC.,
with its principal place of business at
21 Sunset Strip, Succasunna, NJ 07876
(hereinafter referred to as "Tenant").
WHEREAS, Landlord and Tenant did enter into a Lease Agreement dated May
24, 1989 with respect to premises comprising part of the shopping center known
as Roxbury Mall located on Route 10 in Succasunna, New Jersey (which premises,
as heretofore changed or added to, is referred to below as the "Original
Premises"), as such Lease Agreement was amended by Lease Modification Agreement
dated May 2, 1990 (the original Lease Agreement having been entered into by
First Roxbury Company, predecessor in interest to Landlord) (said Lease
Agreement as heretofore modified being referred to as the "Lease"); and
1
WHEREAS, the parties have agreed to a further modification of the Lease in
order for Tenant to lease and to undertake construction upon certain additional
premises contiguous to the Original Premises.
NOW, THEREFORE, for valuable mutual considerations, the parties agree as
follows:
1) LEASE OF PREMISES. Subject to the contingencies set forth hereinbelow,
Landlord demises unto Tenant and Tenant leases from Landlord, upon the terms and
conditions of the Lease as modified hereby, in addition to the Original
Premises, that certain plot of land contiguous to the Original premises as
generally depicted on Second Modification Exhibit A attached hereto and made a
part hereof ("Additional Premises").
2) RENT. It is agreed that the fixed minimum annual rent ("Basic Rent")
for the Additional Premises shall be Five Dollars ($5.00) per square foot per
annum, but shall not exceed Sixty Thousand Dollars ($60,000.00) per annum,
regardless of the square footage, payable in equal monthly installments in the
same manner as is set forth in the Lease for the monthly payments of rent on
account of the Original Premises (it being understood that the said limitation
on Basic Rent shall not affect Tenant's responsibility to pay additional rent
items based on actual gross leasable square footage). No rent on the Additional
Premises shall be due and
2
payable prior to June 1, 1995, at which date, Tenant shall be and become
responsible for payment of one-half (1/2) of the Base Rent set forth above, plus
all additional rents provided for in the Lease as adjusted to reflect the total
aggregate space then comprising the leased Premises (Tenant being obligated to
pay for any utilities which it actually uses from and after the time Tenant
takes occupancy of the Additional Premises). At the earlier of (i) October 1,
1995 or (ii) the date as of which Tenant opens for business, the full amount of
the Basic Rent for the Additional Premises shall commence to be due. Such Basic
Rent shall be increased every five (5) years by an amount equal to Fifty Cents
($.50) per square foot (based on the actual gross leasable square footage) at
five (5) year intervals during the term and any option or extension terms
hereafter in effect, with the first such increase to be effective as of July 1,
2000. The Basic Rent shall be determined specifically on the basis of the actual
gross leasable area of the Addition excluding any mezzanine area used solely for
a projection booth. The parties shall execute an addendum hereto at such time as
the specific rent is determined, in order to document such rent.
3) MODIFICATION OF PERCENTAGE RENT PROVISION. After the commencement
date of the leasing of the Additional Premises, the base amount for determining
Tenant's percentage rent shall be and remain at One Million Six Hundred Thousand
Dollars ($1,600,000.00).
3
4) DEMOLITION OF EXISTING BUILDING. Subject to satisfying the
contingencies as set forth hereinbelow, Tenant shall, with due diligence and in
compliance with all applicable legal requirements, at its own cost and expense,
demolish the existing improvements on the Additional Premises, it being
understood that the Additional Premises are being leased in an "as is"
condition, with whatever improvements are currently located thereon, without
representation or warranty by Landlord of any nature.
5) CONTINGENCIES. (a) Notwithstanding anything contained in this Second
Lease Modification Agreement to the contrary, the continued effectiveness of
this Second Lease Modification Agreement is contingent upon Tenant securing all
necessary municipal, state and federal permits, approvals and licenses,
including but not limited to site plan approval from the Township of Roxbury,
for the construction of an addition as set forth below. Tenant shall with due
diligence, at its own cost and expense, attempt to obtain, as of April 1, 1995,
site plan approval from the Township of Roxbury and any additional governmental
approvals as may be required for the construction on the Additional Premises of
up to 15,000 square feet of gross leasable area as an addition (the "Addition")
to the existing movie theater complex (the "Approvals"). In the event Tenant is
unable to secure all of the Approvals on or before April 1, 1995 (which may be
extended upon the mutual agreement of both parties) for at least 12,000 square
feet of gross leasable area, then this Second Lease Modification Agreement
shall, at the option
4
of either party upon notice to the other, terminate and be of no further force
or effect, after which there shall be no further liability of one party to the
other under this Agreement. In the event that this Second Lease Modification
Agreement is terminated as set forth herein, the original Lease Agreement dated
May 24, 1989 as modified pursuant to the Lease Modification Agreement dated May
2, 1990 shall still remain in full force and effect.
(b) Tenant, upon obtaining the Approvals, shall at its own cost and
expenses construct the Addition on the Additional Premises, in a good and
workmanlike manner and in compliance with all legal requirements, without
causing any construction liens to be filed against the Original Premises or
Additional Premises (to the extent permitted by law but with Tenant in any event
having to cause the discharge of any such liens within thirty (30) days of the
filing thereof) and in compliance with any and all requirements of the Lease
with respect to construction work, alterations or improvements made by Tenant.
(c) If notwithstanding Tenant's obtaining of the Approvals, Tenant
determines that any environmental condition of the Additional Premises is such
as to prevent Tenant from lawfully constructing or using the Addition or is such
that the construction or use thereof would, in Tenant's reasonable judgment,
expose Tenant to possible liability by reason of the environmental condition of
the Additional Premises, then and in any of such
5
events, Tenant may terminate this Agreement upon notice to Landlord given prior
to June 1, 1995. Landlord represents that it is not aware of any violations of
environmental laws (federal, state or local) affecting the Additional Premises
nor aware of any environmental condition affecting the Additional Premises as
would cause a termination right as aforesaid. If Tenant shall terminate this
Agreement in accordance with this paragraph 5(c), Landlord shall reimburse
Tenant for all reasonable costs actually incurred by Tenant in connection with
readying the Additional Premises for the intended use thereof, including costs
incurred in connection with obtaining of the Approvals and demolishing of the
existing building, but not including any costs of actual construction of the
Addition (i.e., not including so-called "hard" costs). If Tenant elects not to
terminate this Agreement in accordance with this paragraph 5(c), then Landlord
shall use reasonable efforts to remediate with due diligence the applicable
environmental problem, except that Landlord shall not be required to do so if in
the reasonable judgment of Landlord, the cost thereof would exceed $50,000.00,
nor shall Landlord in fact be obligated to expend more than $50,000.00 for any
environmental remediation (Landlord having the right to terminate this Agreement
at any time if and when such costs are reasonably estimated by Landlord to
exceed $50,000.00 or in fact are determined to exceed such amount). If Landlord
in fact remediates the environmental condition, then the time periods for
payment of rents hereunder shall be postponed from the above-stated dates for
respective time periods equal to the time of the delay
6
for completion of the remediation.
6) MAINTENANCE OF THE PREMISES. Tenant shall be and remain fully
responsible for all maintenance and repairs with respect to the Additional
Premises, whether structural or nonstructural, interior or exterior,
irrespective of the type or nature of maintenance or repair required as set
forth in the original Lease. The Addition shall be and remain property of
Landlord and shall be surrendered with the Original Premises and Additional
Premises at the expiration of the term of the Lease or earlier termination
thereof, in good order and condition and in accordance with the requirements of
the Lease with respect to surrender of premises. Nothing above is intended to
alter or limit Tenant's responsibilities as to maintenance and repairs of the
Original Premises pursuant to the terms of the Lease.
7) OCCUPANCY OF THE PREMISES. Upon satisfaction of all the contingencies
set forth in this Agreement, at such time as Tenant takes occupancy of the
Additional Premises for any purpose including but not limited to the undertaking
of demolition work and/or construction work thereon, Tenant shall become
responsible for compliance with all terms, covenants and conditions of the Lease
imposed upon Tenant, it being understood that upon the execution hereof the word
"Premises" or any other words or phrases used in the Lease which are intended to
refer to the entire space being leased by Landlord to Tenant shall refer to the
aggregate of
7
the Original Premises and the Additional Premises. Anything hereinabove to the
contrary notwithstanding, it is understood that rent, common area maintenance
charges, real estate taxes, or any other additional rent on the Additional
Premises shall not be due and payable prior to the time period specified herein
for commencement of the rental obligation. In no event shall any monies be due
to Landlord for the Additional Premises in the event that this Agreement is
terminated as a result of Tenant's inability to satisfy the contingencies as set
forth herein.
8) ADDRESSES. Landlord's address for rent payment and notice purposes is
641 Shunpike Road, Chatham, New Jersey 07928. A copy of any notice to Landlord
shall be sent to David Mandelbaum, 80 Main Street, West Orange, New Jersey
07052. Tenant's address is Roxbury Cinema, 21 Sunset Strip, Succasunna, New
Jersey 07876. A copy of any notice to Tenant shall be sent to Jack E. Wenarsky,
225 Route 10, Succasunna, New Jersey 07876.
8
9) RATIFICATION OF EXISTING LEASE. Except as hereby amended, the Lease
shall remain in full force and effect.
WITNESS OR ATTEST: LANDLORD: Roxville Associates
/s/ Kathy Hawley By: /s/ Salvatore A. Davino
- -------------------------- ----------------------------
Salvatore A. Davino
TENANT: Roxbury Cinema, Inc.
/s/ Martin Drescher By: /s/ John Nelson
- -------------------------- ----------------------------
Martin Drescher John Nelson, President
Assistant Secretary
9