LEASE AGREEMENT BETWEEN
PHOENIX CAPITAL PARTNERS, LLC,
AS LESSOR,
AND
MVC CAPITAL,
AS LESSEE.
Premises:
RIVERVIEW AT PURCHASE
287 BOWMAN AVENUE
PURCHASE, NEW YORK 10577
Prepared By:
THE LAW OFFICES OF
STEVEN C. HIRSCH, ESQ.
585 STEWART AVENUE
SUITE 430
GARDEN CITY, NEW YORK 11530
(516) 227-1117
TABLE OF CONTENTS
ARTICLE 1 - DEMISE AND TERM OF DEMISE ........................................1
ARTICLE 2 - RENT .............................................................2
ARTICLE 3 - TAXES AND COMMON AREA MAINTENANCE CHARGES ........................3
ARTICLE 4 - USE OF DEMISED PREMISES .........................................10
ARTICLE 5 - POSSESSION AND CONDITION OF DEMISED PREMISES ....................14
ARTICLE 6 - UTILITIES, CLEANING, ETC. .......................................14
ARTICLE 7 - REPAIR AND MAINTENANCE ..........................................20
ARTICLE 8 - LESSOR'S WORK; LESSEE'S WORK ....................................22
ARTICLE 9 - COMPLIANCE WITH LAWS ............................................23
ARTICLE 10 - RIGHTS RESERVED TO LESSOR .......................................23
ARTICLE 11 - INSURANCE .......................................................25
ARTICLE 12 - DAMAGE OR DESTRUCTION ...........................................27
ARTICLE 13 - CURING DEFAULTS; FEES AND EXPENSES ..............................30
ARTICLE 14 - DEFAULT PROVISIONS ..............................................31
ARTICLE 15 - MEASURE OF DAMAGES IN EVENT OF DEFAULT ..........................36
ARTICLE 16 - INDEMNIFICATION .................................................38
ARTICLE 17 - MECHANIC'S AND OTHER LIENS ......................................39
ARTICLE 18 - CONDEMNATION ....................................................40
ARTICLE 19 - COVENANT OF QUIET ENJOYMENT .....................................41
ARTICLE 20 - WAIVER OF COUNTERCLAIM AND JURY TRIAL ...........................41
ARTICLE 21 - NOTICES .........................................................42
ARTICLE 22 - WAIVERS AND SURRENDERS TO BE IN WRITING .........................42
ARTICLE 23 - RIGHTS CUMULATIVE ...............................................43
ARTICLE 24 - CONVEYANCE; LIABILITY OF PARTIES ................................44
ARTICLE 25 - CHANGES AND ALTERATIONS BY LESSEE ...............................45
ARTICLE 26 - CERTIFICATE OF LESSEE ...........................................47
ARTICLE 27 - ASSIGNMENTS, SUBLEASES AND MORTGAGES ............................47
ARTICLE 28 - SUBORDINATION ...................................................51
ARTICLE 29 - SURRENDER; REMOVAL OF LESSEE'S PROPERTY .........................52
ARTICLE 30 - RENEWAL TERM ....................................................53
ARTICLE 31 - THIS ARTICLE HAS BEEN INTENTIONALLY OMITTED .....................55
ARTICLE 32 - BROKERS .........................................................55
ARTICLE 33 - RIGHT OF FIRST OFFER ............................................55
ARTICLE 34 - DEFINITIONS .....................................................57
ARTICLE 35 - MISCELLANEOUS ...................................................62
LIST OF EXHIBITS TO LEASE
EXHIBIT "A" THE METES AND BOUNDS DESCRIPTION OF THE PROPERTY
EXHIBIT "B" THE FLOOR PLANS OF DEMISED PREMISES
EXHIBIT "C" BUILDING RULES AND REGULATIONS
EXHIBIT "D" CLEANING SPECIFICATIONS
EXHIBIT "E" This Exhibit Has Been Intentionally Omitted
EXHIBIT "F" This Exhibit Has Been Intentionally Omitted
EXHIBIT "G" STANDARD REQUIREMENTS FOR ALTERATIONS
TO BE PERFORMED BY LESSEES
AGREEMENT OF LEASE, dated as of December , 2003, between PHOENIX
CAPITAL PARTNERS, LLC, having an office at 287 Bowman Avenue, Purchase, New York
10577 (hereinafter referred to as "Lessor") and MVC CAPITAL, having an office at
287 Bowman Avenue, Purchase, New York 10577 (hereinafter referred to as
"Lessee");
W I T N E S S E T H
WHEREAS, Lessor, is the owner in fee simple absolute of the land and
all the improvements erected thereon located in Purchase in the Town of
Harrison, County of Westchester, State of New York and more particularly
described in EXHIBIT "A" annexed hereto (the "Property");
WHEREAS, Lessor desires to lease to Lessee, and Lessee desires to hire
from Lessor, a portion of the Third (3rd) Floor in the building known as
RiverView at Purchase and located at 287 Bowman Avenue, Purchase, New York 10577
on the Property and which the parties hereto agree shall be deemed to consist of
One Thousand, Six Hundred and Fifty (1,650) rentable square feet (hereinafter
referred to as the "Demised Premises") and as more particularly described on the
floor plans annexed hereto as EXHIBIT "B" and made a part hereof; and
NOW, THEREFORE, in consideration of the foregoing and of the covenants,
conditions and agreements hereinafter set forth, Lessor and Lessee agree as
follows:
ARTICLE 1 - DEMISE AND TERM OF DEMISE
SECTION 1.01.A. Lessor, in consideration of the rents hereinafter
reserved and of the terms, covenants, conditions and agreements herein contained
on the part of Lessee to be paid, observed and fulfilled, does hereby demise and
lease the Demised Premises to Lessee and Lessee hereby hires the same from
Lessor; subject to all present and future zoning ordinances, laws, regulations,
requirements and orders, including building restrictions and regulations, and
all other present and future ordinances, laws, regulations, requirements and
orders of all departments, boards, bureaus, commission and bodies, of any
municipal, county, state or federal governments now or hereafter having or
acquiring jurisdiction of the Demised Premises; Taxes (as hereinafter defined)
not yet due and payable; all other present and future covenants, easements and
restrictions affecting the Property and the Demised Premises and the revocable
nature of any restriction, easement, agreement, ordinance or right affecting the
Property and the Demised Premises.
B. The Demised Premises are demised and leased unto Lessee, for a term
("Term") commencing on the Commencement Date (as hereinafter defined) and
expiring at noon on November 30, 2005 (the "Expiration Date"), unless the same
shall sooner terminate or be extended pursuant to any of the terms, covenants,
conditions or agreements of this Lease or pursuant to law. As used herein, the
"Commencement Date" shall mean December 8, 2003, PROVIDED, HOWEVER, that the
Commencement Date shall not occur unless and until Lessor delivers to Lessee the
Demised Premises in vacant, broom clean condition and free of tenancies.
ARTICLE 2 - RENT
SECTION 2.01. Lessee shall pay to Lessor, or to such other person as
Lessor may from time to time designate, at the address specified in or pursuant
to Section 2.04, during the Term, fixed rent ("Fixed Rent"), over and above the
other and additional payments to be made by Lessee as hereinafter provided, as
follows:
A. During and in respect of the period from Commencement Date
through November 30, 2004 (both dates inclusive), an amount equal to
Fifty-Five Thousand, Two Hundred and Seventy-Five and 00/100
($55,275.00) Dollars (inclusive of electric) payable in equal monthly
installments of Four Thousand, Six Hundred and Six and 25/100
($4,606.25) Dollars (inclusive of electric); and
B. During and in respect of the period from December 1, 2004
through November 30, 2005 (both dates inclusive), an amount equal to
Fifty-Six Thousand, Eight Hundred and Nine and 56/100 ($56,809.56)
Dollars (inclusive of electric) payable in equal monthly installments
of Four Thousand, Seven Hundred and Thirty-Four and 13/100 ($4,734.13)
Dollars (inclusive of electric).
SECTION 2.02.A. Fixed Rent shall be paid in equal monthly installments
on the first day of each and every month during the Term without any set off or
deduction whatsoever; PROVIDED HOWEVER, that if Fixed Rent shall be payable for
any period prior to the first day of the first full month during the Term, then
such Fixed Rent shall be paid in a proportionate amount for the number of days
in such period and paid as and when the first equal monthly installment is
payable as aforesaid. Notwithstanding the foregoing, Lessee shall pay the first
monthly installment of Fixed Rent upon execution of this Lease.
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SECTION 2.03. If Lessee shall fail to pay as and when due under this
Lease any Additional Rent (as hereinafter defined), and such failure shall not
be remedied within the grace period (if any) applicable thereto under this
Lease, Lessor shall have all of the rights and remedies provided in this Lease
as in the case of default in the payment of the Fixed Rent, including any rights
available to Lessor at law or in equity and shall be entitled interest on any
unpaid Fixed Rent and Additional Rent at the maximum legal rate from and after
the end of the grace period following notice of the date such payments were due
until the date payment is made. Except as otherwise specifically provided in
this Lease, the Fixed Rent and Additional Rent shall be paid without notice,
demand, credit, abatement, deduction or setoff of any kind whatsoever. The Fixed
Rent and Additional Rent are sometimes referred to collectively herein as
"Rent."
SECTION 2.04. Lessee shall pay the Rent to Lessor in lawful money of
the United States of America which shall be legal tender for all debts, public
and private, at the time of payment, at the office of Lessor set forth above, or
to such other person or persons and/or at such other place or places as Lessor
may designate from time to time by notice to Lessee. Such payments may be by
check of Lessee, subject to collection, payable to the order of Lessor or to
such other person or persons as Lessor may designate from time to time by notice
to Lessee; any such payment shall be deemed made upon receipt thereof, subject
to collection.
SECTION 2.05. Any obligation of Lessee for payment of Rent which shall
have accrued with respect to any period during or prior to the Term shall
survive the expiration or termination of this Lease for a period of Two (2)
years.
ARTICLE 3 - TAXES AND COMMON AREA MAINTENANCE CHARGES
SECTION 3.01. As used herein:
A. "Lessor's Statement" shall mean an instrument containing a
computation of any Additional Rent payable by Lessee to Lessor pursuant to this
Article.
B. "Common Area Maintenance Charges" shall mean all actual costs and
expenses of whatever kind or nature, whether or not herein specifically
mentioned or now contemplated, which are incurred by Lessor or Lessor's agents
in connection with the use, operation, repair or maintenance of the Building
and/or Property, including, but not limited to the following: (1) premiums and
other charges for insurance which Lessor is required or permitted to maintain
hereunder including, but not limited to, general comprehensive liability
insurance covering bodily injury, personal injury (including death), property
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damage, public liability, non-hired automobile insurance, sign insurance, plate
glass insurance and any other insurance incurred by Lessor for the Building
and/or Property; (2) costs and expenses of performing repairs in or to the
Building and/or Property and the sidewalks and curbs adjacent thereto; (3) costs
and expenses of performing repairs or resurfacing of the parking lots and any
adjacent facilities; (4) costs and expenses of landscaping and maintaining the
grounds of the Building and/or Property; (5) costs and expenses of snow and ice
removal and/or treatment; (6) costs and expense of rubbish, garbage and other
refuse removal; (7) fees and disbursements payable to any person to furnish
management, repair or other services regarding the Building and/or Property,
except that, in the case of any such person who is affiliated with Lessor, such
fees shall not exceed that which is customary or reasonable in the industry for
similar buildings in Westchester County; (8) cost and expenses of performing
repairs to all structural walls, roofs, and plate glass doors and windows, if
any, which are not expressly made part of the Building, Property or the Demised
Premises; (9) cost of refurbishing the common areas and modernizing and
replacing equipment servicing the common areas, including but not limited to
regular painting of non-tenanted areas at the Building and/or Property; (10)
cost and expense of maintenance and repairs of the structural elements of the
Building and/or Property; (11) costs and expenses of performing repairs and
maintenance of lighting and lighting fixtures; (12) repair and maintenance of
all or any part of the sprinkler system installed in any part of the Building
and/or Property; (13) cost of utilities, such as electricity, water and sewer;
depreciation of the capital cost of all items required to be capitalized
pursuant to this Lease, including but not limited to, machinery, equipment
(including on-site sewage, lighting and power facilities) and vehicles used in
connection with the operation and maintenance of the common areas as determined
by Lessor for federal income tax purposes but utilizing the straight-line method
of computing depreciation and the normal useful lives; (14) costs and expenses
of performing repairs and maintenance of all heating, ventilating and air
conditioning equipment installed in any part of the Building, including but not
limited to that portion contained within the Demised Premises; (15) cost and
expense of performing repairs and maintenance of utility lines, sanitary and
storm sewer lines and culverts and drainage facilities; (16) costs and expenses
of providing and maintaining security, if any; (17) costs and expenses of
providing and maintaining traffic control, if any; (18) labor costs and expenses
of part and/or full time personnel employed at the Property in connection with
the operation of the Building at or below the grade of building manager; (19)
costs and expenses of providing holiday and other decorations to the Building
and/or Property; (20) costs and expenses of performing repairs and maintenance
of all elevators in any part of the Building and/or Property; (21) cost and
expense of providing and maintaining porter and matron service at the Building
and/or Property, if any; (22) cost and expense of providing and performing
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cleaning and related services; (23) cost and expense of providing window
washing; (24) cost and expense of all supplies; (25) wages, salaries, disability
benefits, pensions, hospitalization, retirement plans and group insurance
respecting service and maintenance employees of Lessor; (26) cost and expense of
all uniforms and working clothes for such employees and the cleaning thereof;
(27) cost and expense imposed on Lessor pursuant to law or to any collective
bargaining agreement with respect to such employees; (28) cost and expense of
providing and maintaining worker's compensation insurance, payroll, social
security, unemployment and other taxes now in effect or hereinafter imposed with
respect to such employees; (29) cost of all sales, utility and use taxes and
other taxes of like import now in effect or hereinafter imposed; (30) cost and
expense of all maintenance and service contracts for the Building and/or
Property; (31) cost of all other normal operating expenses of repair, operation,
and maintenance of the Building and/or Property; (32) cost and expense of
providing and maintaining loading dock and mail personal, if any; (33) cost and
expense of all professional and consulting fees, including legal and audit fees
and all costs and disbursements incurred in connection therewith; (34) such cost
and expenses shall be subject to Lessor's overhead and administrative cost of
[FIVE (5%)] percent; and (35) the cost of any capital equipment or capital
expenditures only to the extent specifically provided for in Section 3.01.C.
hereof;
PROVIDED, HOWEVER, that the following items shall be excluded from Common Area
Maintenance Charges: (1) leasing commissions; (2) cost of repairs or
replacements incurred by reason of fire or other casualty (to the extent the
same is or would have been covered by insurance required to be maintained by
Lessor herein), or caused by the exercise of the right of eminent domain (to the
extent same is covered by any condemnation award) less any cost incurred by
Lessor in obtaining such insurance proceeds or condemnation award; (3) costs
incurred in performing work or furnishing services to or for individual tenants
(including Lessee) at such tenant's expense; (4) debt service on any mortgages
now or hereafter encumbering the Building and/or Property; (5) the cost of
performing or furnishing services for tenants other than Lessee at Lessor's
expense, to the extent that such work or service Lessor is obligated to furnish
to or for Lessee at Lessor's expense and (6) the cost of attorneys' fees
incurred in connection with negotiating and drafting leases with other tenants,
or in connection with disputes with other tenants; (7) costs incurred in the
sale or refinancing of the Building and/or Property; (8) interest or penalties
due to Lessor's violations of law; (9) advertising and promotional expenses;
(10) depreciation; (11) leasehold improvements made for other tenants; and (12)
Taxes.
C.1. If Lessor shall purchase any item of capital equipment or make any
capital expenditure intended to result in savings or reductions in the Common
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Area Maintenance Charges and which Lessor reasonably believes shall provide
Lessee with the benefit of a savings or reduction in such common area
maintenance charges based upon the advice of Lessor's consultants, then the
costs for same shall be included in the Common Area Maintenance Charges, to the
extent hereinafter set forth. Lessor shall deliver to Lessee, promptly following
Lessee's request, a copy of any concluded studies conducted by Lessor which show
anticipated savings or reductions in such Common Area Maintenance Charges as a
result of any planned capital expenditure or purchase of capital equipment. The
costs of capital equipment or capital expenditures are so to be included in the
Common Area Maintenance Charges in which the costs are incurred and in any
subsequent years, on a straight-line basis, to the extent that such items are
amortized over such period of time as reasonably can be estimated at the time in
which such savings or reductions in such Common Area Maintenance Charges are
expected to equal Lessor's costs for such capital equipment or capital
expenditure, with an interest factor equal to two percent (2%) above the
interest rate payable on United States Treasury securities having a maturity
comparable to the period of amortization at the time Lessor incurred said costs.
If Lessor shall lease any such item of capital equipment designed to result in
savings or reductions in any common area maintenance charges, then the rentals
and other costs paid pursuant to such leasing shall be included in such common
area maintenance charges for the year in which they were incurred.
2. If Lessor shall purchase any item of capital equipment or make any
other capital expenditure in order to comply with Legal Requirements, Insurance
Requirements or Environmental Laws (as those terms are hereinafter defined) or
in order to benefit or increase the safety and security of the Building or
Property tenants and/or invitees, then the costs for same shall be included in
common area maintenance charges for the year in which the costs are incurred and
subsequent years, on a straight-line basis, amortized over the useful life of
such items, with an interest factor equal to two percent (2%) above the interest
rate payable on United States Treasury securities having a maturity comparable
to the useful life of such items at the time Lessor incurred said costs. If
Lessor shall lease any such item of capital equipment to comply with Legal
Requirements, Insurance Requirements, Environmental Laws or to increase safety
and security then the rentals and other costs paid pursuant to such leasing
shall be included in common area maintenance charges for the year in which they
were incurred.
D. Lessor shall have the absolute right, at all times during the Term
and any Renewal Term, (as hereinafter defined) to increase, reduce, alter or
otherwise modify the way in which it uses, operates, repairs, or maintains the
Building and/or the Property and the cost thereof. Nothing contained herein
shall require Lessor to incur or provide any particular service or charge in
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connection with its use, operation, repair or maintenance of the Building and/or
Property, it being agreed and understood that the items described in Section
3.01.B. are by way of illustration only and shall not obligate Lessor thereto,
except that Lessor shall maintain the Building and Property in such condition as
is otherwise provided for herein.
E. The term "Taxes" shall mean all such taxes, assessments, use and
occupancy taxes in respect of this Lease and any subleases made hereunder, water
and sewer charges, rates and rents, water and other meter charges and all such
other charges, taxes, levies and sums of every kind or nature whatsoever,
general and special, extraordinary as well as ordinary, whether or not now
within the contemplation of the parties, as shall or may during or in respect of
the Term (or any period prior to the Term for which Fixed Rent is payable) be
assessed, levied, charged or imposed upon or become a lien on the Property,
Building, or Demised Premises, or any part thereof, or anything appurtenant
thereto, or the sidewalks, streets or roadways in front of, adjacent to or
appurtenant to the Property, Building or Demised Premises (and which have a
basis related in any way to the Property, Building, or Demised Premises and/or
the use or manner of use thereof), or which, if imposed on Lessee or in respect
of the Property, Building or Demised Premises and if not paid by Lessee, would
be collectible from Lessor, or which have been so assessed, levied, charged or
imposed prior to the Term (but, in the last-mentioned case, only with respect to
a period falling within the Term); PROVIDED, HOWEVER, that, except if and to the
extent otherwise provided in the succeeding sentence, "Taxes" shall not mean
federal, state or local income taxes, franchise, excise, gift, transfer, capital
stock, estate, succession or inheritance taxes or penalties or interest for late
payment of any tax in respect of which Lessee shall have duly made payment of
Additional Rent as herein provided, or any increase in Taxes directly
attributable to Lessor's Initial Building Renovation. If, at any time during the
Term, the methods of taxation prevailing at the commencement of the Term shall
be altered so that, in lieu of or as a substitution in whole or in part for the
taxes, assessments, levies, impositions or charges now or hereafter levied,
assessed or imposed on real estate and the improvements thereon, shall be
levied, assessed or imposed any tax or other charge on or in respect of the
Property, Building and/or Demised Premises or the rents, income or gross
receipts of Lessor therefrom (including any county, town, municipal, state or
federal levy), then such tax or charge shall be deemed a Tax, but only to the
extent that such Tax would be payable if the Property, Building or Demised
Premises, or the rent, income or gross receipts received therefrom, were the
only property of Lessor subject to such Tax, and Lessee shall pay and discharge
the same as herein provided in respect of the payment of Taxes.
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F. The term "School Tax Base" shall mean the amount of Taxes as
hereinabove defined, imposed, levied, assessed and/or collected on the Property,
for the second half of the 2003/2004 School Tax and the first half of the
2004/2005 School Tax and "City Tax Base" shall mean the amount of Taxes as
hereinabove defined, imposed, levied, assessed and/or collected on the Property
for the 2004 City, County and State Tax.
G. The term "School Tax Year" shall mean each period of twelve (12)
consecutive months commencing as of the first day of July of each such period;
and "City Tax Year" shall mean each period of twelve (12) consecutive months
commencing as of the first day of January of each such period, in which any part
of the term of this Lease shall occur, or such other periods of twelve (12)
months as may be adopted as the fiscal year for real estate tax purposes.
SECTION 3.02.A. Lessee shall pay to Lessor, as Additional Rent, during
or in respect of the period from the Commencement Date to the Expiration Date
(both dates inclusive) for each School Tax Year and City Tax Year or portion
thereof, its proportionate share ("Lessee's Proportionate Share", as hereinafter
defined) of increases in Taxes which will be imposed, levied, assessed or
collected on the Property, and/or Building of which the Demised Premises are a
part, for such School Tax Year and/or City Tax Year, as the case may be, over
the respective tax bases regardless of whether such increase results from a
higher tax rate and/or an increase in the assessed valuation of either the
Property or Building or any other tax. Reasonable fees and expenses, if any,
incurred in obtaining any reduction in assessed valuation from the tentative
assessment to the final assessment shall also be considered an increase in Taxes
for the purpose of this provision. Such payments shall be made by Lessee as
Additional Rent in equal monthly installments during the applicable tax year
together with the payment of Fixed Rent. Copies of tax bills applicable to the
School Tax Base and the City Tax Base, as the case may be, and to any such
applicable tax year shall be made available by Lessor for inspection by Lessee
during normal business hours. In the event of any reduction in Taxes after final
assessment and with respect to which Lessee has paid its proportionate share,
any such reduction, less fees and expenses incurred to obtain such reduction
shall be refunded in proportionate amounts to Lessee.
B. If Lessor obtains a reduction of either the School Tax Base or City
Tax Base by final determination of legal proceedings or otherwise, then: (i) the
School Tax Base or City Tax Base shall be correspondingly revised, (ii) all Tax
payments theretofore paid or payable hereunder shall be recomputed on the basis
of such reduction, (iii) Lessee shall pay to Lessor as Additional Rent, within
thirty (30) days after receipt of a bill therefor, any deficiency between the
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amount of such Tax payments theretofore computed and the amount thereof due as a
result of such recomputations and (iv) all future Tax payments shall be computed
using the revised School Tax Base and City Tax Base.
SECTION 3.03.A. Lessee shall pay to Lessor, as Additional Rent, during
or in respect of the period from the Commencement Date to the Expiration Date
(both dates inclusive) for each calendar year or portion thereof, Lessee's
Proportionate Share of the increases in the Common Area Maintenance Charges
over the Base Common Area Maintenance Charges (as hereinafter defined). Such
payments shall be made by Lessee as Additional Rent in equal monthly
installments during the applicable calendar year together with the payment of
Fixed Rent.
B. The term "Base Common Area Maintenance Charges" shall mean the
Common Area Maintenance Charges in effect for the calendar year ending December
31, 2003.
SECTION 3.04.A. At any time hereafter and from time to time, Lessor may
furnish to Lessee a Lessor's Statement setting forth (i) Lessor's actual Common
Area Maintenance Charges (or any one or more items thereof) and/or actual Taxes
for a period which shall have expired only if a final statement has not been
previously rendered, and/or (ii) Lessor's reasonable estimate of Common Area
Maintenance Charges and/or Taxes for a succeeding period. Within Thirty (30)
days next following rendition of each such Lessor's Statement, Lessee shall pay
to Lessor the entire amount, if any, shown on such Lessor's Statement as being
due with respect to any period which shall have expired. In addition, Lessee
shall pay to Lessor, on the first day of each month following rendition of each
such Lessor's Statement, on account of the estimated Additional Rent thereafter
payable, a proportionate sum of the total Additional Rent shown upon such
Lessor's Statement as being Lessor's reasonable estimate for a succeeding period
on an annual basis (it being agreed that Lessor's estimate shall in any event be
deemed reasonable if it is based on actual Common Area Maintenance Charges (or
any one or more items thereof) and/or actual Taxes for a period which shall have
expired immediately prior thereto, so that one month prior to the end of such
period, Lessee's Proportionate Share of the increase shall be paid in full, and
Lessee shall continue to pay Additional Rent on such basis until receipt of a
subsequent Lessor's Statement. Such Additional Rent shall be due and payable at
the same time as each monthly installment of Fixed Rent.
B. A reconciliation shall be made upon each Lessor's Statement as
follows: Lessee shall be debited with any Common Area Maintenance Charges and/or
Taxes payable as shown on such Lessor's Statement, and credited with the
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aggregate of the total amount, if any, paid by Lessee in accordance with the
provisions of the preceding paragraph on account of the estimated Additional
Rent, for the period or item in question, and, within thirty (30) days next
following rendition of such Lessor's Statement, Lessee shall pay Lessor the
amount of any net debit balance shown thereon or Lessor shall apply against the
next ensuing installments of Fixed Rent the net credit balance shown thereon.
C. Without limiting the preceding provisions of Section 3.04, it is
understood that Lessor shall furnish a Lessor's Statement, for each calendar
year falling wholly or partially within the Term.
SECTION 3.05. A. Lessor's failure to render Lessor's Statements with
respect to any period shall not prejudice Lessor's right to render a Lessor's
Statement with respect to that or any subsequent period. The obligations of
Lessor and Lessee under the provisions of this Article with respect to
Additional Rent shall survive the expiration or any sooner termination of the
Term.
B. Each Lessor's Statement shall be conclusive and binding upon Lessee
unless within ninety (90) days after receipt of such Lessor's Statement, Lessee
shall notify Lessor that it disputes the reasonableness or correctness of
Lessor's Statement, specifying the respects in which Lessor's Statement is
claimed to be unreasonable or incorrect. Pending the determination of such
dispute by agreement or otherwise, Lessee shall pay Additional Rent in
accordance with the applicable Lessor's Statement, and such payment will be
without prejudice to Lessee's position.
SECTION 3.06. Lessee shall pay and discharge, or cause to be paid and
discharged, the following items, regardless of to whom or how incurred, all
taxes and assessments, if any, which shall or may during the Term be charged,
levied, assessed or imposed upon, or become a lien upon, the personal property
of Lessee used in the operation of the Demised Premises and which, if not paid
by Lessee, would be collectible from Lessor.
ARTICLE 4 - USE OF DEMISED PREMISES
SECTION 4.01.A. Subject to the provisions of this Article, Lessee shall
have the right to use the Demised Premises for general and executive office
purposes and for no other purposes.
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B. From and after the Commencement Date, Lessor does hereby grant unto
Lessee the privilege and a license to Seven (7) non-reserved parking spaces in
the parking area located on the Property for a period to be coterminous with the
Term of this Lease. Lessee agrees that Lessor shall have the right, in its sole
and absolute discretion, upon thirty (30) days written notice to Lessee, to
change the location of all parking spaces in the event that Lessor determines to
change the area, level, location and arrangement of parking areas and other
facilities; to build multistory parking facilities; to temporarily restrict
parking by lessees, their officers, agents and employees; and to close all or
any portion of said areas or facilities to such extent as may be legally
sufficient to prevent a dedication thereof or the accrual of any right to any
person or the public therein; to close temporarily all or any portion of the
parking areas or facilities to discourage non-customer parking. The license and
privilege hereby granted shall apply only to those duly registered and operating
private passenger motor vehicle(s) owned and operated by Licensee or Licensee's
employees, invitees and contractors and shall not be transferable to any other
person or used for any other purpose other than as herein provided.
SECTION 4.02. Lessee shall not use or occupy the Demised Premises in
any manner or suffer or permit the Demised Premises or any part thereof to be
used in any manner, or do or suffer or permit anything to be done in the Demised
Premises, or bring anything into the Demised Premises or suffer or permit
anything to be brought into the Demised Premises, which would in any way do any
of the following: (a) violate any of the provisions of the Mortgage (as
hereinafter defined) or Superior Lease (as hereinafter defined); (b) violate any
Legal Requirements, Insurance Requirements or Environmental Laws (as such terms
are hereinafter defined); (c) make void or voidable any insurance policy then in
force with respect to the Demised Premises, Building or Property; (d) make
unobtainable from insurance companies authorized to do business in the State of
New York and rated by Best's Insurance Rating Service with a rating at least
equal to A:XII, at standard rates without any special premium or charge, any
fire or other casualty insurance with extended coverage, or rental, liability or
boiler insurance, or other insurance provided for in Section 11.01 or otherwise
may be required to be furnished by Lessor under the terms of the Mortgage or
Superior Lease with respect to the Demised Premises; (e) cause physical damage
to the Demised Premises, Building or Property, or any part thereof; (f)
constitute a public or private nuisance; (g) substantially impair the appearance
or character of the Demised Premises, Building or Property; (h) discharge or
cause the discharge of objectionable substances, fumes, vapors or odors from the
11
Demised Premises not otherwise in compliance with Legal Requirements, Insurance
Requirements and Environmental Laws; (i) cause Lessee to default in the
observance and performance of any of its other obligations to be observed and
performed under this Lease; (j) unreasonably interfere with the effectiveness or
accessibility of the utility, mechanical, electrical and other systems installed
or located anywhere at the Demised Premises, or (k) violate any of the
Building's Rules and Regulations annexed hereto as EXHIBIT "C," as same may be
amended from time to time.
SECTION 4.03. If any governmental license or permit shall be required
for the proper and lawful conduct of Lessee's business in the Demised Premises
or any part thereof, then Lessee, at its sole cost and expense, shall duly
procure and thereafter maintain such license or permit and submit the same to
inspection by Lessor. Lessee shall, at all times, comply with the terms and
conditions of each such license or permit, but in no event shall failure to
procure and maintain same by Lessee affect Lessee's obligations hereunder.
Lessee shall not use or occupy the Demised Premises, or suffer or permit anyone
to use or occupy the Demised Premises, in violation of any certificate of
occupancy issued for the Building or Property.
SECTION 4.04. Lessor shall obtain a certificate(s) of occupancy
required for Lessee's occupancy of the Demised Premises upon the Commencement
Date.
SECTION 4.05. Lessee shall not place, or suffer, or permit anyone to
place a load upon any floor of the Building that exceeds the floor load per
square foot that such floor was designed to carry and which is allowed by
certificate, rule, regulation, permit or law, nor shall Lessee overload, or
suffer, or permit anyone to overload any wall, roof, land surface, pavement,
landing or equipment on the Demised Premises.
SECTION 4.06. Lessee shall not use, or suffer, or permit anyone to use,
on or across the Demised Premises, Building or Property, any equipment having
caterpillar-type tracks or tires, or any other equipment which would be damaging
to the Demised Premises, Building or Property or any road surface or
blacktopping thereon.
SECTION 4.07. A. Lessee shall not release, discharge or dispose of, or
permit, or suffer any release, discharge or disposal of any Hazardous Material
at the Demised Premises in violation of any Environmental Law (as hereinafter
defined). Lessee shall not permit or suffer the manufacture, generation,
storage, transmission or presence of any Hazardous Material over or upon the
Demised Premises in violation of any Environmental Law.
B. Lessee shall: (i) promptly, upon learning thereof, notify Lessor of
any violation of, or non-compliance with, potential violation of or
non-compliance with, or liability or potential liability under, any
Environmental Law concerning the Demised Premises, (ii) promptly make (and
12
deliver to Lessor copies of) all reports or notices that Lessee is required to
make under any Environmental Law concerning the Demised Premises and maintain in
current status all permits and licenses required under any Environmental Law
concerning the Demised Premises, (iii) immediately comply with any orders,
actions or demands of any Governmental Authority (as herein defined) with
respect to the discharge, clean-up or removal of Hazardous Materials at or from
the Demised Premises due to a breach of a covenant set forth in Section 4.07.A,
(iv) pay when due the cost of removal of, treatment of, or the taking of
remedial action with respect to, any Hazardous Material on the Demised Premises
which is required by an Environmental Law due to a breach of a covenant set
forth in Section 4.07.A, (v) keep the Demised Premises free of any lien imposed
pursuant to any Environmental Law in respect of a breach of a covenant set forth
in Section 4.07.A, (vi) from time to time, upon the request of Lessor, execute
such affidavits, certificates and statements concerning Lessee's knowledge and
belief concerning the presence of Hazardous Materials on the Demised Premises
and (vii) otherwise comply with all Environmental Laws concerning the Demised
Premises.
SECTION 4.08.A. Lessor shall include Lessee's name on any internal
Building directory and on the floor directional signs. Other than the foregoing,
Lessee shall not place or suffer to be placed or maintain any sign, awning or
canopy upon or outside the Demised Premises or in the Building; nor shall Lessee
place at the store front any sign, decoration, lettering or advertising matter
of any kind without first obtaining Lessor's written approval and consent in
each instance. In the event that Lessor gives its consent hereunder, all signs
shall be of a size, color and design as is approved in writing by Lessor and
shall be installed where designated by Lessor and maintained in good condition,
repair and appearance at all times, according to Lessor's standards and the laws
of the municipality having jurisdiction over such signs. If Lessor shall deem it
necessary to remove any sign in order to paint or to make any repairs,
alterations or improvements in or upon the Demised Premises or any part thereof,
Lessor shall have the right to do so, provided the same be removed and replaced
at Lessor's cost and expense unless having been occasioned by fault of Lessee.
Lessor shall have the right, with or without notice to Lessee, to remove any
signs (paper or otherwise) installed by Lessee in violation of this paragraph
and to charge Lessee the cost of such removal without liability to Lessee for
such removal.
SECTION 4.09 No property, other than such as might normally be brought
upon or kept in the Demised Premises as incidental to the reasonable use of the
Demised Premises for the purposes herein permitted, will be brought upon or kept
in the Demised Premises.
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ARTICLE 5- POSSESSION AND CONDITION OF DEMISED PREMISES
SECTION 5.01. Lessee accepts the Demised Premises in their "AS IS"
state and condition on the Commencement Date and without any representation or
warranty (except as expressly set forth herein), express or implied, in fact or
by law, by Lessor, and without recourse to Lessor, as to title thereto, the
nature, condition or usability thereof or as to the use or occupancy which may
be made thereof.
SECTION 5.02. If delivery of possession to the Demised Premises to
Lessee is delayed by reason of Unavoidable Delays (as hereinafter defined), then
this Lease and the validity thereof shall not be affected thereby and Lessee
shall not be entitled to terminate this Lease, to claim actual or constructive
eviction, partial or total, or to be compensated for loss or injury suffered as
a result thereof, nor shall the same be construed in any way to extend the Term,
PROVIDED, HOWEVER, that, notwithstanding the provisions of Article 1, the
Commencement Date shall be deemed to occur only if and when possession of the
Demised Premises is made available to Lessee.
SECTION 5.03. The provisions of this Article shall be considered an
express provision to the contrary pursuant to New York REAL PROPERTY LAW Section
223-(a) governing delivery of possession of the Demised Premises and any law
providing for such a contingency in the absence of such express agreement now or
hereafter enacted shall have no application in such case to the extent
inconsistent with this Lease.
ARTICLE 6- UTILITIES, CLEANING, ETC.
SECTION 6.01.A. During the Term hereof and any Renewal Term, Lessor
shall furnish to Lessee, during Normal Working Hours (as hereinafter defined:
(i) necessary elevator facilities; (ii) heat to the Demised Premises when and as
required by law; (iii) water for ordinary lavatory purposes for the Demised
Premises, but if Lessee uses or consumes water for any other purposes or in
unusual quantities (of which fact Lessor shall be the sole judge), Lessor may
install a water meter at Lessee's expense in good working order and repair to
register such water consumption and Lessee shall pay for water consumed as shown
on said meter as Additional Rent as and when bills are rendered; (iv) air
conditioning and/or cooling for the Demised Premises through the Building's air
conditioning and/or cooling system (the "Building's AC System"); (v) ventilation
for the Demised Premises; and (vi) electricity for Building lighting and normal
Building equipment and other incidental equipment (hereinafter collectively
referred to as the "Utility Service").
B. Except as otherwise specifically provided for in this Lease, Lessor
represents and warrants that Lessee shall have access (by elevator) to the
Demised Premises Twenty-Four (24) hours a day, Seven (7) days a week.
14
C.1. The Building's AC System shall be capable of substantially meeting
the following maximum performance specifications:
Inside Condition Outside Condition
(DEGREES) (DEGREES)
---------------- ------------------
Cooling Season
78(degree)F dry bulb 95(degree)F dry bulb
50% RH 75(degree)F wet bulb
Heating Season 0(degree)F
72(degree)F dry bulb
2. The foregoing performance standards shall be inapplicable where the
Demises Premises are occupied by more than an average of one person for each 200
square feet of Lessee's floor space or if Lessee installs and operates machines
and appliances, the installed electrical load of which when combined with the
load of all lighting fixtures and all occupancy factors exceeds four (4) watts
of connected load per square foot of Lessee's floor space in any one room or
other area or in any area used other than for offices. If due to use of the
Demised Premises in a manner exceeding the aforementioned occupancy and
electrical load criteria, or due to rearrangement of partitioning after the
initial preparation of the Demised Premises, interference with normal operation
of the air conditioning in the Demised Premises results, necessitating changes
in the air conditioning system servicing the Demised Premises, such changes
shall be made by Lessor upon written notice to Tenant and Tenant's sole cost and
expense. Tenant agrees to keep all windows closed, and to lower and close window
coverings when necessary because of the sun's position whenever the said air
conditioning system is in operation, and Lessee agrees at all times to cooperate
fully with Lessor and to abide by all the regulations and requirements which
Lessor may prescribe for the proper functioning and protection of the said air
conditioning system. Lessor, throughout the Term, shall have free and
unrestricted access to any and all air conditioning facilities in the Demised
Premises.
SECTION 6.02. During the Term hereof and any Renewal Term, Lessor shall
furnish to Lessee cleaning services for the Demised Premises, Monday through
Friday, in accordance with the Cleaning Specifications annexed hereto as EXHIBIT
"D".
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SECTION 6.03.A. If Lessee uses the Demised Premises outside Normal
Working Hours and such use constitutes Extraordinary Use (as hereinafter
defined), Lessee agrees to pay to Lessor, overtime charges to cover Lessor's
actual expenses for electricity for lighting and normal Building Equipment (as
hereinafter defined) and other incidental equipment, extra building maintenance,
building employee overtime, furnishing water for lavatories, air cooling, heat,
ventilation, wear and tear, etc ("Overtime Charge").
B.1 Lessor shall furnish such overtime service to Lessee provided that
(i) Lessee pays to Lessor as Additional Rent the Overtime Charge therefore,
which Overtime Charge will be billed to Lessee along with Lessee's next monthly
installment of Fixed Rent if such service shall have been furnished to Lessee
prior to the fifteenth (15th) day of the month or along with the subsequent
monthly installment of Fixed Rent if such service shall have been furnished to
Lessee after the fifteenth (15th) day of the month, and (ii) that Lessee's
request shall be received by Lessor by not later than 2:00 P.M. on the day for
which after hours service is requested (and by not later than 2:00 P.M. on the
day preceding any requested before-hours service) Notwithstanding anything
contained to the contrary in this Article 6, Lessee shall not be required to pay
Overtime Charges for intermittent use of the Demised Premises outside Normal
Working Hours, unless such use shall be on a scale and frequency so as to
constitute the regular operation of Lessee's business outside Normal Working
Hours ("Extraordinary Use"). In no event, however, shall Lessor be obligated to
supply heating or air conditioning outside of Normal Working Hours unless Lessee
shall request and pay for the same as provided in this Article 6. In the event
that Lessee and any other tenant in the Building shall request Overtime
Services, then, to the extent that the Building Equipment permits same, Lessee
and such other tenants shall pay their proportionate share of the Overtime
Charges.
2. Lessee agrees that the Overtime Charges, may from time to time, be
increased by Lessor, with not less than thirty (30) days prior written notice to
Lessee, if the rates at which Lessor purchases electrical energy from the public
utility corporation supplying electrical current to the Building of which the
Demised Premises are a part shall be increased, or any tax is imposed upon
Lessor's receipt from the sale or resale of electrical energy by any Federal,
State or Municipal Authority, or any charges incurred or taxes payable by Lessor
in connection therewith shall be increased. The Overtime Charges shall be
16
increased by an amount equal to the product of the respective hourly rate times
the percentage increase in the rates at which Lessor purchases electrical energy
from the public utility corporation as aforesaid.
SECTION 6.04.A. Lessee acknowledges and agrees that Lessor shall
furnish electrical current to Lessee ("Electric Service") for use in the Demised
Premises based on the method of including the use thereof within the Fixed Rent
and, accordingly, Lessee agrees that the Fixed Rent provided for in Article 2 of
this Lease has been increased to compensate Lessor for supplying Electric
Service on the basis of Two and 50/100 Dollars ($2.50) per square foot per annum
for each square foot contained in the Demised Premises (hereinafter referred to
as the "Base Charge") payable in equal monthly installments commencing on the
Commencement Date. By the execution of this Lease, Lessee acknowledges and
agrees that the Base Charge shall not be contestable by Lessee at a future date
and shall only be increased by Lessor at a future date in accordance with this
Section. Lessor will furnish electricity to Lessee through presently installed
electrical facilities for Lessee's reasonable use.
B.1. Lessee shall make no substantial alterations or additions to the
initial lighting, electrical appliances or office equipment if the connected
electrical load, when combined with the load of all lighting fixtures and all
occupancy factors exceeds four (4) watts per square foot of installed ceiling
area, without first obtaining written consent from Lessor in each instance.
Lessor warrants that the electrical facilities servicing the Demised Premises is
in good working order and can accommodate a normal office installation with
associated office machinery and equipment, PROVIDED, HOWEVER, that the connected
electrical load, when combined with the load of all lighting fixtures and all
occupancy factors does not exceed four (4) watts per square foot of installed
ceiling area. Lessee agrees that at all times its use of Electric Service shall
not exceed the capacity or overload any of the central and appurtenant
installations for Electric Service including, but not limited to all wires,
feeders, risers, electrical boxes, switches, outlets, connections, and cables
located in the Property, Building, or Demised Premises or any other mechanical
equipment spaces located therein. Lessee's use of Electric Service shall not
interfere with the use thereof by other occupants of the Property, or Building
and shall be of such a nature, as determined by Lessor in its sole judgment and
discretion, so as not cause permanent damage or injury to the Demised Premises
or the Building of which the Demised Premises are a part, or cause or create a
dangerous or hazardous condition or entail excessive or unreasonable
alterations, repairs or expense, or interfere with or disturb other tenants or
occupants.
17
2. If at any time prior to or during the Term or any Renewal Term of
this Lease, subject to the restrictions contained elsewhere in this Lease: (i)
Lessee installs substantial additional or substituted lighting, electrical
appliances, office equipment or otherwise increases its use of Electric Service
so that the connected electrical load, when combined with the load of all
lighting fixtures and all occupancy factors exceeds four (4) watts per square
foot of installed ceiling area, and/or; (ii) subject to the provisions of
Article 8 of this Lease, electrical feeders, risers, wiring or other electrical
facilities serving the Demised Premises shall be installed by Lessor, Lessee or
others, on behalf of Lessee or any person claiming through or under Lessee in
addition to the feeders, risers, wiring or other electrical facilities necessary
to serve the lighting fixtures, electrical appliances, office equipment and
electrical receptacles initially located in the Demised Premises so that the
connected electrical load, when combined with the load of all lighting fixtures
and all occupancy factors exceeds four (4) watts per square foot of installed
ceiling area; then the Fixed Rent shall be increased by an amount determined by
the electrical engineer selected by Lessor who shall certify the amount of the
Additional Rent to be increased in writing to Lessor and Lessee. Following any
such determination and certification by the electrical engineer, this Lease
shall automatically be modified by increasing the Additional Rent by an amount
equal to (i) the product of the Base Charge times the percentage increase in
Lessee's use of electrical current over that for Lessee's initially installed
lighting, electrical appliances and office equipment and/or (ii) the product of
the Base Charge times the percentage increase in the potential additional
electrical energy made available to Lessee annually based upon the estimated
capacity of such additional electrical feeders, risers, wiring or other
electrical facilities, as the case may be. As evidence of such modification such
electrical engineer's certification shall be delivered by Lessor to Lessee and
also appended hereto. Any such increase shall be effective as of the date of the
first use by Lessee of such additional service and retroactive to such date if
necessary. In addition, Lessee shall pay to Lessor, as Additional Rent, within
ten (10) days of the date of a notice therefore from Lessor, the total Cost (as
hereinafter defined) to Lessor of the additional electrical feeders, risers,
wiring, or other electrical facilities serving the Demised Premises.
C. If, at any time or times after the date of this Lease, the rates at
which Lessor purchases electrical energy from the public utility corporation
supplying electrical current to the Building of which the Demised Premises are a
part shall be increased, or any tax is imposed upon Lessor's receipt from the
18
sale or resale of electrical energy or gas or telephone service to Lessee by any
Federal, State or Municipal Authority, or any charges incurred or taxes payable
by Lessor in connection therewith shall be increased, the Additional Rent shall
be increased by an amount equal to the product of the Base Charge times the
percentage increase in the rates at which Lessor purchases electrical energy
from the public utility corporation as aforesaid, over those rates in effect on
the date of the calculation of the Base Charge. The rates in effect on the date
of the calculation of the Base Charge is more particularly set forth on EXHIBIT
"E" annexed hereto and made a part hereof. Following any such rate increase or
other charge, this Lease shall automatically be modified by increasing the
Additional Rent for the remainder of the term hereof in accordance with this
Subsection and, as evidence of such modification, documentation of such rate
increase or other charge shall be delivered by Lessor to Lessee and also
appended hereto. Any such increase in the Additional Rent shall be effective as
of the date of any such increase in cost or other charge to Lessor and shall be
retroactive to such date if necessary.
D. Notwithstanding anything contained to the contrary in this Article
6, Lessor shall have the right, at its option, to conduct a survey of the
Demised Premises by an electrical engineer of Lessor's choosing at any time
during the term of this Lease in order to determine Lessee's actual use of
electrical current therein. In the event that Lessor's survey provided for in
the preceding sentence shall indicate that Lessee's use of electrical current
then exceeds that at the time of Lessee's initial installation of its lighting
fixtures, electrical appliances and office equipment, Lessee, upon receipt of
notice from Lessor, shall pay to Lessor an increase in Fixed Rent equal to an
amount determined by multiplying the Base Charge times the percentage increase
in Lessee's use of electrical current over that for Lessee's initially installed
lighting, electrical appliances and office equipment. Any such increase shall be
payable in accordance with the terms of this Article 6 and shall be effective as
of the date of Lessee's first increased use of electrical current and shall be
retroactive to such date, if necessary.
SECTION 6.05. Lessor reserves the right to stop, interrupt and/or
suspend Utility Service and/or Electric Service when necessary by reason of
accident or for repairs, alterations, replacements or improvements necessary or
desirable in the judgement of Lessor for as long as may be reasonably required
19
by reason thereof. The repairs, alterations, replacements or improvements shall
be done with a minimum of inconvenience to Lessee and upon reasonable advance
notice to Lessee (except that a lesser notice appropriate under the
circumstances shall be given in the event of an emergency) and Lessor shall use
its best efforts to pursue same with due diligence.
SECTION 6.06. The Lessor shall in no way be liable for any loss,
damage, or expense which Lessee may incur as a result of the change, at any
time, of the character or quality of Electric Service or Utility Service or any
failure of or defect in Electric Service or Utility Service by reason of any
public or private utility company then supplying such service to the Property,
Building or the Demised Premises and Lessee agrees to hold the Lessor harmless
and to indemnify it from and against any loss, liability or damage to Lessee or
a third party in connection therewith due to the negligent acts or omissions of
Lessee and its agents, employees, contractors, subcontractors, officers and
directors. This indemnity shall survive the expiration or other termination of
this Lease.
ARTICLE 7- REPAIR AND MAINTENANCE
SECTION 7.01.A. Subject to the provisions of Section 7.02 hereof,
Lessee shall, during the Term of this Lease and any Renewal Term, at Lessee's
sole cost and expense, take good care of, maintain and make all repairs, (other
than structural) in the Demised Premises, and the fixtures and equipment therein
and appurtenances thereto, including but not limited to, internal doors and
entrances, door checks, internal signs, floor covering, interior walls, columns
and partitions; and lighting, heating, hot water, plumbing and sewerage
facilities, sprinkler system and sprinkler heads; and variable air volume boxes
and controls, thermostats and light switches, supplemental air conditioning
units, if any, located within the Demised Premises and serving only the Demised
Premises.
B. If Lessee refuses or neglects to clean, maintain or make repairs or
otherwise fails to perform any of Lessee's repairs or maintenance obligations
hereunder, Lessor shall have the right, but shall not be obligated, to make such
repairs or perform on behalf of and for the account of Lessee. All sums so paid
by Lessor in connection with the payment or performance by it or any of the
obligations of Lessee hereunder and all actual and reasonable costs, expenses
and disbursements paid in connection therewith or enforcing or endeavoring to
20
enforce any right under or in connection with this Lease, or pursuant to law,
together with interest thereon at the maximum legal rate from the respective
dates of the making of such payment, shall constitute Additional Rent payable by
Lessee under this Lease and shall be paid by Lessee to Lessor upon demand by
Lessor. The provisions of this Section shall survive the expiration or other
termination of this Lease.
SECTION 7.02. Lessor shall not be required to make any repairs or
improvements of any kind upon the Demised Premises except for necessary
structural repairs to the Building, Building Equipment, or for damage caused by
a casualty or Lessor's negligent acts, excluding Lessee's property. Lessor shall
during the Term of this Lease and any Renewal Term, maintain and repair all
common areas and other facilities in or about the Property and/or the Building,
exclusive of interior doors, door frames, door checks, windows and window
frames. Lessor shall have the right to construct, maintain and operate lighting
and other facilities on all said areas and improvements; to police the same; to
change the area, level, location and arrangement of parking areas and other
facilities; to build multistory parking facilities; to restrict parking by
Lessee's, their officers, directors, agents and employees, to enforce parking
charges (by operation of meters and otherwise); and to close all or any portion
of said areas or facilities to such extent as may be legally sufficient to
prevent a dedication thereof or the accrual of any right to any person or the
public therein; to close temporarily all or any portion of the parking areas or
facilities to discourage non-visitor parking. Lessor shall operate and maintain
the common areas in such manner as Lessor in its discretion shall determine, and
Lessor shall have full right and authority to employ and discharge all personnel
with respect thereto. If Lessor shall designate an employee or lessee parking
area or areas, Lessee and its employees shall use only such areas for parking
and Lessee shall cooperate fully with Lessor in enforcing this covenant.
SECTION 7.03. "Repairs" as used herein shall mean all repairs,
replacements, renewals, alterations, additions and betterments. All contracts
between Lessee and others for installations, maintenance, and repairs and
alterations involving the Demised Premises, including maintenance agreements,
shall be subject to the prior written approval of Lessor, not to be unreasonably
withheld or delayed.
21
SECTION 7.04. Lessor shall not be required to make any repairs or
replacements to the common areas occasioned by the act or negligence of Lessee,
its agents, employees, invitees, customers, licensees, or contractors, except to
the extent that Lessor is reimbursed therefor under any policy of insurance
permitting waiver of liability and containing a waiver of subrogation, except as
otherwise provided in this Article and Article 12 of this Lease.
ARTICLE 8- LESSOR'S WORK; LESSEE'S WORK
SECTION 8.01. Lessee acknowledges that Lessor shall have no obligation
whatsoever to perform any build-out or similar work to Demised Premises, and
Lessee agrees to accept same in "AS IS" physical order and condition on the
Commencement Date and without any representation or warranty, express or
implied, in fact or by law, by Lessor, and without recourse to Lessor, as to the
nature, condition or usability thereof or as to the use or occupancy which may
be made thereof.
SECTION 8.02 Following the Commencement Date, Lessee shall build-out
and fully equip the Demised Premises with all trade and operating fixtures and
equipment, plumbing, lighting and other fixtures and equipment, furniture,
furnishings, floor covering, and any and all other items necessary for the
proper operation of Lessee's business ("Lessee's Work"). All trade and operating
fixtures and equipment, plumbing, lighting and other fixtures and equipment,
furniture, furnishings, fixtures, floor covering, and any and all other items
necessary for the proper operation of Lessee's business installed by Lessee
shall be new or completely reconditioned and shall not be subject to liens,
conditional sales contracts, security agreements or chattel mortgages. Lessee
shall complete or cause to be completed all of Lessee's Work required on
Lessee's part to be performed in and at the Demised Premises under this Lease
pursuant to Lessor's STANDARD REQUIREMENTS FOR ALTERATIONS TO BE PERFORMED BY
LESSEES' annexed hereto as EXHIBIT "G" and made a part hereof.
SECTION 8.03. Other than Lessee's Work, Lessee shall not do any
construction, work or alterations to the Demised Premises, nor shall Lessee
install any items other than Lessee's trade fixtures without first: (1)
obtaining Lessor's written consent AND (2) complying with all of the terms,
covenants and conditions contained in Lessor's STANDARD REQUIREMENTS FOR
ALTERATIONS TO BE PERFORMED BY LESSEES', as may be amended from time to time.
22
ARTICLE 9- COMPLIANCE WITH LAWS
SECTION 9.01. Lessor represents that the Demised Premises, the Building
and Property will comply with all Legal Requirements, Environmental Laws and
Insurance Requirements as of the Commencement Date.
SECTION 9.02. Throughout the Term of this Lease, Lessee shall promptly
comply with all Legal Requirements, Environmental Laws and Insurance
Requirements whether or not such compliance involves structural repairs or
changes or be required on account of any particular use to which the Demised
Premises, or any part, may be put by Lessee, other than general office use, and
whether or not any such Legal Requirements, Environmental Laws, or Insurance
Requirements be of a kind not now within the contemplation of the parties
hereto. Compliance by Lessee with Legal Requirements, Environmental Laws, and
Insurance Requirements shall be at Lessee's sole cost and expense. Lessee shall
not contest the application or validity of any such Legal Requirements,
Environmental Laws, or Insurance Requirements without the prior written consent
of Lessor in each such instance. Any repair or change required under this
Section shall be deemed a repair for the purposes of Article 7. With respect to
actions necessary to comply with Legal Requirements, Insurance Requirements and
Environmental Laws which due to their nature, can only be taken by Lessor,
Lessor, at Lessee's expense, will cooperate with Lessee in facilitating such
compliance.
ARTICLE 10- RIGHTS RESERVED TO LESSOR
SECTION 10.01. Lessee shall permit Lessor, Lessor's agents, and its
invitees to enter the Demised Premises, or any part thereof, at all reasonable
times provided same does not unreasonably interfere with Lessee's business and a
representative of Lessee is present for the purposes of (a) inspecting the same,
(b) curing Events of Default of Lessee (after Ten (10) days notice to Lessee,
except that no notice shall be required in case of an emergency), (c) showing
the same to mortgagees, appraisers, or prospective lenders, purchasers or
lessees, (d) observing the performance by Lessee of its obligations under this
Lease, (e) performing any act or thing which Lessor may be obligated or have the
right to do under this Lease or otherwise, and (f) any other reasonable purpose.
Lessor and any providers of Utility Services or other services shall have the
right to maintain existing utility, mechanical, electrical and other systems and
to enter upon the Demised Premises to make such repairs and alterations therein
23
or in or to the Demised Premises as may, in the opinion of Lessor, be deemed
necessary or advisable. Lessor shall not be liable for inconvenience, annoyance,
disturbance or loss of business to Lessee or any sublessee by reason of making
any repairs or the performance of any work, or on account of bringing materials,
tools, supplies and equipment into or through the Demised Premises during the
course thereof and the obligations of Lessee under this Lease shall not be
affected thereby. The rights provided in this Article shall be exercised so as
to minimize interference with the use and occupancy of the Demised Premises by
Lessee. Nothing contained in this Article shall impose, or shall be construed to
impose on Lessor any obligation to maintain the systems referred to in this
Article or the Demised Premises or anything appurtenant thereto, or to make
repairs or alterations thereof or thereto, or to create any liability for any
failure to do so.
SECTION 10.02.A. Without abatement or diminution in rent, Lessor
reserves and shall have the following additional rights: (a) to change the
street address and/or the name of the Building of which the Demised Premises are
a part and/or the Property and/or the locations of entrances, passageways,
doors, doorways, corridors, elevators, stairs, toilets, or other public parts of
the Building and/or Property without liability to Lessee, (b) to approve in
writing all sources furnishing construction work, painting, decorating,
repairing, maintenance and any other work in or about the Demised Premises, (c)
to erect, use and maintain pipes and conduits in and through the Demised
Premises, (d) to charge to Lessee any expense including overtime cost incurred
by Lessor in the event that repairs, alterations, decorating or other work in
the Demised Premises are made or done after ordinary business hours at Lessee's
request, (e) to immediately enter and alter, renovate, and redecorate the
Demised Premises (without reduction or abatement of rent or incurring any
liability to Lessee for compensation), if during the last four (4) months of the
term or of a renewal term Lessee shall have removed all or substantially all of
Lessee's property therefrom, and (f) to grant to anyone the exclusive right to
conduct any particular business or undertaking in the Building of which the
Demised Premises are a part.
B. Lessor may exercise any or all of the foregoing rights hereby
reserved to Lessor without being deemed guilty of an eviction, actual or
constructive, or disturbance or interruption of Lessee's use or possession and
without being liable in any manner toward Lessee and without limitation or
abatement of rent or other compensation, and such acts shall have no effect on
this Lease.
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ARTICLE 11- INSURANCE
SECTION 11.01. A. Lessee shall obtain and keep in full force and effect
during the Term, and during any earlier period of time when Lessee or Lessee's
agents, employees, or contractors may enter the Demised Premises at its own cost
and expense:
(1) commercial general liability insurance (with a contractual
liability endorsement covering the matters set forth in Article 16)
having a combined single limit of not less than Three Million
($3,000,000.00) Dollars protecting Lessor, any Lessor's agent which is
acting as a property manager for the Property, the holder of any
Mortgage, or lessor under any Superior Lease and Lessee as insureds
(and naming each such person as an insured party or as an additional
insured) against any and all claims for bodily injury, death or
property damage occurring, during the Term and during any earlier
period of time when Lessee or Lessee's agents, employees, or
contractors may enter the Demised Premises;
(2) insurance (herein sometimes referred to as "Lessee's fire
(casualty) insurance") against loss or damage by any and all risks and
hazards to Lessee's Property (as hereinafter defined) for the full
replacement value thereof (including coverages which are currently
sometimes referred to as "all risk" with coverage written on a
replacement cost basis);
(3) workers' compensation and employees liability insurance in
accordance with the laws of the State of New York and all Governmental
Authorities having jurisdiction over the Demised Premises and/or the
Property; and
(4) Lessee shall insure and keep insured in the name of
Lessee, with the name of Lessor included as an additional insured, at
Lessee's expense, broad form boiler insurance in the amount of at least
Five Hundred Thousand ($500,000.00) Dollars, only if there is a steam
boiler, steam generator, or any other combustible device, mechanism or
appliance in, on, adjoining or beneath the Demised Premises, for the
exclusive use of the Lessee. Lessee shall further insure, at Lessor's
request, against any other peril generally insured against by a
business of Lessee's type.
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B. Said insurance is to be written in form and substance reasonably
satisfactory to Lessor by an insurance company, licensed to do business in the
State of New York, which shall be rated by Best's Insurance Rating Service with
at least a rating equal to A:XII. Lessee shall procure, maintain and place such
insurance and pay all premiums and charges therefor and upon failure to do so
Lessor may, but shall not be obligated to, procure, maintain and place such
insurance or make such payments, and in such event Lessee agrees to pay the
amount thereof plus interest at the maximum legal rate then prevailing, to
Lessor on demand as Additional Rent. If Lessee has other locations that it owns
or leases, said policy shall include an aggregate per location endorsement.
Lessee shall cause to be included in all such insurance policies (i) a provision
to the effect that the same will not be canceled or modified except upon not
less than thirty (30) days prior written notice to the Lessor, and (ii) a
provision to the effect that the naming of any person other than Lessee as an
insured shall not obligate such person to pay any premium. Each such Lessee's
fire (casualty) insurance policy shall contain an agreement by the insurer that
the act or omission of one insured will not invalidate the policy as to any
other insured. Not less than ten (10) days prior to the Commencement Date the
original insurance policies or appropriate certificates and paid receipts
therefor, (together with a photocopy of the policy, if Lessor shall so request)
shall be deposited with Lessor. Any renewals or endorsements thereto shall also
be deposited with Lessor, not less than ten (10) days prior to the expiration
date of the policy being renewed, replaced or endorsed, to the end that said
insurance shall be in full force and effect at all times during the Term.
SECTION 11.02. Lessee agrees to use reasonable efforts to include in
each of its insurance policies (insuring the Demised Premises and Lessor's
property therein, against loss occasioned by fire or other casualty) a waiver of
the insurer's right of subrogation against the Lessor, or if such waiver should
be unobtainable or unenforceable, (a) an express agreement that such policy
shall not be invalidated if the insured waives or has waived before the casualty
the right of recovery against any party responsible for a casualty covered by
the policy, or (b) any other form of permission for the release of the other
party, or (c) the inclusion of the Lessor as an additional insured. Lessee, upon
request from Lessor from time to time, will furnish evidence of the nature of
the insurance arrangements made concerning the subject matter of this Section.
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SECTION 11.03. As long as both parties' fire (casualty) insurance
policies then in force include the waiver of subrogation or agreement or
permission to release liability referred to in Section 11.02 or name the other
party as an additional insured, each party hereby waives (and agrees to cause
any other permitted occupants of the Demised Premises to execute and deliver to
the other party written instruments waiving) any right of recovery against the
other party, the holder of the Mortgage, or Superior Lease, and any servants,
employees, agents or contractors of the other party, or of any such lessor or
holder, or of any such other tenants or occupants, for any loss occasioned by
fire or other casualty, that is an insured risk under Lessee's fire (casualty)
insurance policies. In the event that at any time either party's fire (casualty)
insurance carriers shall not include such or similar provisions in the other
party's fire (casualty) insurance policies, the waivers set forth in the
foregoing sentence shall be deemed of no further force and effect. During any
period when either party fails to maintain such fire (casualty) insurance, for
the purposes of the first sentence of this Section there shall be deemed to be
in effect such fire (casualty) insurance meeting the requirements of such
sentence.
SECTION 11.04. Nothing contained in this Lease shall (i) relieve Lessee
of any liability to Lessor or to its insurance carriers which Lessee may have
under law or the provisions of this Lease in connection with any damage to the
Demised Premises by fire or other casualty; (ii) impose upon Lessor any duty to
procure or maintain any kinds of insurance or any particular amounts or limits
of any such kinds of insurance.
SECTION 11.05. Lessor shall insure the Building with all risk insurance
coverage in such amounts so as to avoid co-insurance and Lessor agrees that such
policies shall contain a waiver of subrogation in favor of Lessee.
ARTICLE 12 - DAMAGE OR DESTRUCTION
SECTION 12.01. If the Demised Premises or any part thereof shall be
damaged by fire or other casualty, Lessee shall give prompt notice thereof to
Lessor and Lessor shall proceed (subject to the provisions of this Article) with
reasonable diligence to repair or cause to be repaired such damage. Except as
provided in Section 12.05, the Fixed Rent shall be abated proportionately to the
extent that the Demised Premises shall have been rendered Untenantable (as
hereinafter defined), such abatement to be from the date of such damage or
destruction to the date the Demised Premises shall no longer be Untenantable.
27
SECTION 12.02. If the Demised Premises shall be totally damaged or the
whole of the Demised Premises shall be rendered Untenantable by fire or other
casualty, and Lessor has not terminated this Lease pursuant to Section 12.03 and
Lessor has not completed the making of the required repairs and restored and
rebuilt the Demised Premises and/or access thereto within one (1) year from the
date of such damage or destruction to the condition the Demised Premises were in
on the date preceding such casualty (except for Lessee's Property), and such
additional time after such date, as shall equal the aggregate period Lessor may
have been delayed in doing so by Unavoidable Delays or adjustment of insurance,
Lessee may serve notice on Lessor of its intention to terminate this Lease and
if within thirty (30) days thereafter, Lessor shall not have substantially
completed the making of the required repairs and restored and rebuilt the
Demised Premises to the condition the Demised Premises were in on the date
preceding such casualty (except for Lessee's Property), then in such events,
this Lease shall terminate on the expiration of such thirty (30) day period as
if such termination date were the Expiration Date, and the Fixed Rent and
Additional Rent shall be apportioned as of such date of sooner termination and
any prepaid portion of Fixed Rent and Additional Rent for any period after such
date shall be refunded by Lessor to Lessee.
SECTION 12.03.A. If the Demised Premises shall be totally damaged or
the whole or substantially all of the Demised Premises shall be rendered
Untenantable by fire or other casualty or if the Demised Premises shall be so
damaged by fire or other casualty that substantial alteration or reconstruction
shall, in Lessor's reasonable opinion, be required, then and in such events
Lessor may, at its option, terminate this Lease and the Term and estate hereby
granted by giving Lessee not less than thirty (30) days, nor more than sixty
(60) days, notice of such termination, within ninety (90) days after the date of
such damage. In the event that such notice of termination shall be given, this
Lease and the Term and estate hereby granted shall terminate as of the date
provided in such notice of termination (whether or not the Term shall have
commenced) with the same effect as if that were the Expiration Date, and the
Fixed Rent and Additional Rent shall be apportioned as of such date of sooner
termination, and any prepaid portion of Fixed Rent and Additional Rent for any
period after such date shall be refunded by Lessor to Lessee.
B. If the Demised Premises shall be totally damaged or the whole or
substantially all of the Demised Premises shall be rendered untenantable by fire
or other casualty, and Lessor has not terminated this Lease as provided in
Section 12.03.A., Lessor shall notify Lessee, within ninety (90) days after such
28
fire or other casualty, as to the estimated period of time necessary to complete
the required repairs and restore and rebuild the Demised Premises to the level
of demising walls. If such Lessor's estimate exceeds one (1) year, from the date
of such notice, or if Lessor falls to deliver such notice, then in such events,
Lessee may serve on Lessor, within thirty (30) days of its receipt of Lessor's
notice, or the expiration of the ninety (90) days after such fire or other
casualty, as the case may be, (time being of the essence with respect thereto),
notice of its intention to terminate this Lease on a date which shall be not
more than thirty (30) days from the date of Lessee's notice. If Lessee gives
notice of its intention to cancel this Lease as provided herein, then in such
events, this Lease shall terminate on the expiration of such thirty (30) day
period as if such termination date were the Expiration Date, and the Fixed Rent
and Additional Rent shall be apportioned as of such date of sooner termination
and any prepaid portion of Fixed Rent and Additional Rent for any period after
such date shall be refunded by Lessor to Lessee. Lessee's failure to notify
Lessor within the thirty (30) day period shall be deemed a waiver of the right
to terminate this Lease.
SECTION 12.04. Lessor shall not be liable for any inconvenience or
annoyance to Lessee or injury to the business of Lessee resulting in any way
from such damage by fire or other casualty or the repair thereof.
SECTION 12.05. Lessee shall restore all improvements made by Lessee to
the Demised Premises, at Lessee's sole cost and expense. Nothing herein
contained shall relieve Lessee from any liability to the Lessor or to its
insurers in connection with any damage to the Property, Building or Demised
Premises by fire or other casualty if Lessee shall be legally liable in such
respect. Notwithstanding any of the foregoing provisions of this Article, if by
reason of some action or inaction on the part of Lessee or any of its employees,
agents, officers, directors or contractors, Lessor or the holder of the Mortgage
or Superior Lease shall be unable to collect all of the insurance proceeds
(including rent insurance proceeds) applicable to damage or destruction of the
Demised Premises by fire or other cause, then, without prejudice to any other
remedy which may be available against Lessee, the abatement of Fixed Rent
provided for in this Article shall not be effective to the extent of the
uncollected insurance proceeds.
29
SECTION 12.06. This Lease shall be considered an express agreement to
the contrary pursuant to New York REAL PROPERTY LAW Section 227 governing any
case of damage to or destruction of the Demised Premises or any part thereof by
fire or other casualty, and any law providing for such a contingency in the
absence of such express agreement, now or hereafter enacted, shall have no
application in such case to the extent inconsistent with this Lease.
SECTION 12.07. Lessee shall, at its own cost and expense, remove all of
Lessee's property from the Demised Premises as Lessor shall require in order to
repair and restore the Demised Premises and Lessor shall not be obligated to
commence repairs or restoration of the Demised Premises until such property has
been removed by Lessee from the damaged portion of the Demised Premises. Should
Lessee neglect, fail, or refuse to remove its aforesaid property within thirty
(30) days after such damage or destruction, the provisions for abatement of
Fixed Rent contained herein shall be suspended and of no force and effect
whatsoever until Lessee has completed such removal. In no event shall the Lessor
be required to repair or replace Lessee's merchandise, trade fixtures,
furniture, furnishings, inventory and equipment.
ARTICLE 13 - CURING DEFAULTS; FEES AND EXPENSES
SECTION 13.01. If Lessee shall default in the full and prompt
performance of any covenant contained herein and to be performed on Lessee's
part, Lessor, after ten (10) days notice to Lessee (except that a lesser notice
appropriate to the circumstances shall be required in case of an emergency),
without being under any obligation to do so and without thereby waiving such
default may perform such covenant for the account and at the expense of Lessee
and may enter upon the Demised Premises for any such purpose and take all action
thereon as may be necessary therefor. All sums so paid by Lessor in connection
with the payment or performance by it of any of the obligations of Lessee
hereunder and all actual and reasonable costs, expenses and disbursements paid
in connection therewith or enforcing or endeavoring to enforce any right under
or in connection with this Lease, or pursuant to law, together with interest
thereon at the maximum legal rate from the respective dates of the making of
each such payment, shall constitute Additional Rent payable by Lessee under this
Lease and shall be paid by Lessee to Lessor upon demand by Lessor. The
provisions of this Section shall survive the expiration or other termination of
this Lease.
30
ARTICLE 14 - DEFAULT PROVISIONS
SECTION 14.01. A. If any one or more of the following events shall
happen and shall not have been cured within any applicable grace period
herein provided:
(1) if default shall be made in the due and punctual payment
of Fixed Rent or Additional Rent payable by Lessee under this Lease
when and as the same shall become due and payable, and such default
shall continue for a period of five (5) days after written notice
thereof from Lessor to Lessee (provided that no such notice shall be
required if, during the period of one (1) year immediately preceding
the date of default, there shall have been two (2) or more defaults in
the due and punctual payment of Fixed Rent or Additional Rent payable
by Lessee under this Lease when and as the same shall have been due and
payable); or
(2) if default shall be made by Lessee in performance of, or
compliance with, any of the covenants, agreements or conditions
contained in this Lease and either (i) in the case of a default or a
contingency which can with due diligence be cured within thirty (30)
days, such default shall continue for a period of thirty (30) days
after written notice thereof from Lessor to Lessee, or (ii) in the case
of a default or a contingency which cannot with due diligence be cured
within thirty (30) days, Lessee shall fail, after written notice
thereof from Lessor, to proceed promptly and with all due diligence to
commence to cure the same and thereafter to prosecute the curing of
such default with all due diligence (it being intended that, in
connection with a default which is not susceptible of being cured with
due diligence within thirty (30) days the time of Lessee within which
to cure the same shall be extended for such period as may be necessary
for the curing thereof with all due diligence); or
(3) if Lessee shall file a voluntary petition seeking an order
or relief under Title 11 of the United States Code or similar law of
any jurisdiction applicable to Lessee, or Lessee shall be adjudicated a
debtor, bankrupt or insolvent, or shall file any petition or answer
seeking, consenting to or acquiescing in any order for relief,
reorganization, arrangement, composition, adjustment, winding-up,
liquidation, dissolution or similar relief with respect to Lessee or
its debts under the present or any future bankruptcy act or any other
31
present or future applicable federal, state or other statute or law, or
shall file an answer admitting or failing to deny the material
allegations of a petition against it for any such relief or shall
generally not, or shall be unable to, pay its debts as they become due
or shall admit in writing in any filing with any court or Governmental
Authority its insolvency or its inability to pay its debts as they
become due, or shall make a general assignment for the benefit of
creditors or shall seek or consent or acquiesce in the appointment of
any trustee, receiver, examiner, assignee, sequestrator, custodian or
liquidator or similar official of Lessee or of all or any part of
Lessee's property or if Lessee shall take any action in furtherance of
or authorizing any of the foregoing; or if Lessee shall call a meeting
of, or propose any form of arrangement, composition, extension or
adjustment with, its creditors holding a majority in amount of Lessee's
outstanding indebtedness; or
(4) if any case, proceeding or other action shall be commenced
or instituted against Lessee, seeking to adjudicate lessee a bankrupt
or insolvent, or seeking an order for relief against Lessee as debtor,
or reorganization, arrangement, composition, adjustment, winding-up,
liquidation, dissolution or similar relief with respect to Lessee or
its debts under the present or any future bankruptcy act or any other
present or future applicable federal, state or other statute or law, or
seeking appointment of any trustee, receiver, examiner, assignee,
sequestrator, custodian or liquidator or similar official of Lessee or
of all or part of Lessee's property, which either (i) results in the
entry of an order for relief, adjudication of bankruptcy or insolvency
or such an appointment or the issuance or entry of any other order
having similar effect or (ii) remains undismissed for a period of
ninety (90) days; or if any case, proceeding or other action shall be
commenced or instituted against Lessee seeking issuance of a warrant of
execution, attachment restraint or similar process against Lessee or
any of Lessee's property which results in the taking or occupancy of
the Demised Premises or an attempt to take or occupy the Demised
Premises which shall not have been vacated, discharged, or stayed or
bonded pending appeal within ninety (90) days after the entry thereof;
or
32
(5) if any event shall occur or any contingency shall arise
whereby this Lease or the estate hereby granted to the unexpired
balance of the Term would, by operation of law or otherwise, devolve
upon or pass to any person other than Lessee, except as is expressly
permitted under Article 27, or if default shall be made by Lessee in
the performance of, or compliance with, the covenants, agreements and
conditions set forth in Article 27; or
(6) if Lessee's (other than Lessee herein named) obligations
under this Lease shall have been guaranteed by any person other than
Lessee and such person shall default in observance or performance of
any term, covenant or condition to be observed or performed by such
person under the instrument or agreement containing such guarantee; or
(7) if any financial statement or other information furnished
to Lessor by Lessee in connection with this Lease is materially false
or misleading; or
(8) if Lessee shall default in the observance or performance
of any term, covenant or condition on Lessee's part to be observed or
performed under the provisions of Section 35.09; or
(9) if Lessee is the subject of a Chapter 11 reorganization
under the Bankruptcy Reform Act of 1978 and such reorganization is not
confirmed within eighteen (18) months from the time of filing of a
voluntary or involuntary petition thereunder (it being understood that
in such event Lessee consents to the termination of the automatic stay
provisions of Section 362 of such Act);
then and in any such event (hereinafter sometimes called an "Event of Default")
Lessor may give written notice ("Termination Notice") to Lessee specifying such
Event of Default or Events of Default and stating that this Lease and the Term
shall expire and terminate on the date specified in the Termination Notice,
which shall be at least seven (7) days after the giving of the Termination
Notice, and on the date specified therein this Lease and the Term and all rights
of Lessee under this Lease shall expire and terminate, it being the intention of
33
the Lessor and Lessee hereby to create conditional limitations, and Lessee shall
remain liable as provided in Article 15 and in accordance with those provisions
of this Lease which are specifically stated herein to survive the expiration or
other termination of this Lease.
B. Notwithstanding the provisions of Section 14.01.A, if there shall be
an Event of Default at any time or from time to time under the provisions of
subdivision (1) of Section 14.01.A, Lessor may, in lieu of giving a Termination
Notice, at any time after the occurrence of any such Event of Default and during
the continuance thereof, institute an action for the recovery of the Fixed Rent
and/or Additional Rent in respect of which an Event of Default shall have
occurred and be continuing. Neither the commencement of any such action for the
recovery of Fixed Rent and/or Additional rent nor the prosecution thereof shall
be deemed a waiver of Lessor's right to give a Termination Notice in respect of
any such Event of Default during the continuance thereof and Lessor may,
notwithstanding the commencement and prosecution of any such action, give a
Termination Notice and terminate this Lease pursuant to Section 14.01.A at any
time during the continuance of such Event of Default.
C. If, at any time, (i) Lessee shall be comprised of two or more
persons, or (ii) Lessee's obligations under this Lease shall have been
guaranteed by any person other than Lessee, or (iii) Lessee's interest in this
Lease shall have been assigned, the word "Lessee", as used in subdivisions (4),
(5) and (9) of Section 14.01.A, shall be deemed to mean any one or more of the
persons primarily or secondarily liable for Lessee's obligations under this
Lease. Any monies received by Lessor from or on behalf of Lessee during the
pendency of any proceeding of the types referred to in said subdivisions (4),
(5) and (9) of Section 14.01.A shall be deemed paid as compensation for the use
and occupation of the Demised Premises and the acceptance of any such
compensation by Lessor shall not be deemed an acceptance of rent or a waiver on
the part of Lessor of any rights under Section 14.01.
SECTION 14.02. In the event that this Lease shall be terminated as
provided in this Article, Lessor or Lessor's agents may, immediately, or at any
time thereafter, without further notice, enter upon and re-enter the Demised
Premises and possess and repossess itself thereof, by summary proceedings,
ejectment or otherwise, and have, hold and enjoy the Demised Premises and the
right to receive all income of and from the same. No re-entry by Lessor pursuant
to this Article shall be deemed an acceptance of a surrender of this Lease nor
shall it absolve or discharge Lessee from any liability under this Lease.
34
SECTION 14.03. In the event that this Lease shall be terminated as
provided in this Article, Lessor may, at any time or from time to time
thereafter, relet the Demised Premises or any part thereof, for such term or
terms (which may be greater or less than the period which would otherwise have
constituted the balance of the Term) and on such conditions (which may include
concessions or free rent, which shall, however, be amortized over the entire
term for the purpose of determining damages under Article 15) as Lessor may
determine, to any tenant which it may deem suitable and satisfactory and for any
use and purpose it may deem appropriate and may collect and receive the rents
therefor. Lessor shall use commercially reasonable methods in making such
reletting. Lessor, at its option, may make such repairs, alterations, additions,
improvements, decorations and other physical changes in and to the Demised
Premises as Lessor considers advisable or necessary in connection with any such
reletting or proposed reletting, without relieving Lessee of any liability under
this Lease or otherwise affecting any such liability. Lessor shall in no way be
responsible or liable for any failure to relet the Demised Premises, or any part
thereof, or for any failure to collect any rent due upon such reletting. Lessor
shall not in any event be required to pay Lessee (but shall credit Lessee, to
the extent set forth in Article 15, with) any sums received by Lessor on a
reletting of the Demised Premises, or any part thereof, whether or not in excess
of the rent reserved in this Lease.
SECTION 14.04. Lessee, on its own behalf and on behalf of all persons
claiming through or under Lessee including all creditors, does hereby waive any
and all rights and privileges, so far as is permitted by law, which Lessee and
all such persons might otherwise have under any present or future law, to (i)
the service of any notice of intention to re-enter or institute legal
proceedings to that end, excluding service of process, (ii) redeem the Demised
Premises, (iii) re-enter or repossess the Demised Premises, or (iv) restore the
operation of this Lease, after Lessee shall have been dispossessed by a judgment
or by warrant of any court or judge, or after any re-entry by Lessor or after
any expiration or termination of this Lease and the Term, whether such
dispossess, re-entry, expiration or termination shall be by operation of law or
pursuant to the provisions of this Lease. The words "re-enter," "re-entry" and
"re-entered" as used in this Lease shall not be deemed to be restricted to their
technical legal meanings.
35
SECTION 14.05. In the event the Lessee shall dispute the validity or
amount, or the time or manner of payment of, any rent claimed by Lessor to be
due from Lessee under this Lease, Lessee shall nevertheless pay the same and
such payment may be without prejudice to Lessee's position if Lessee so requests
at the time of payment. If the dispute shall be finally determined in Lessee's
favor by a court of competent jurisdiction, Lessor shall within a reasonable
period of time not to exceed sixty (60) days pay Lessee the amount of Lessee's
overpayment of such rent. Lessee's failure to observe and perform the provisions
of this Section shall be deemed a default under subdivision (1) of Section
14.01.A.
ARTICLE 15 - MEASURE OF DAMAGES IN EVENT OF DEFAULT
SECTION 15.01. A. In the event that this Lease be terminated pursuant
to Article 14 as a result of an Event of Default on the part of the Lessee and
whether or not the Demised Premises be relet, Lessor shall be entitled to retain
all monies, if any, paid by Lessee to Lessor, whether as advance rent or
otherwise, but such monies shall be credited by Lessor against any rent due at
the time of such termination, or at Lessor's option, against any damages payable
by Lessee, and Lessor shall be entitled to recover from Lessee, and Lessee shall
pay to Lessor the following:
(a) All rent to the date upon which this Lease and the Term shall have
terminated, and
(b) All expenses reasonably incurred by Lessor in recovering possession
of the Demised Premises (including summary proceedings), restoring the
Demised Premises to good order and condition, maintaining the Demised
Premises in good order and condition while vacant, altering or
otherwise preparing the same for reletting, and in reletting the
Demised Premises (including brokerage commissions, administrative costs
and legal expenses), the same to be paid by Lessee to Lessor on demand,
and
(c) The amount by which the rent which, but for the termination of this
Lease, would have been payable under this Lease from the date of
termination to the Expiration Date exceeds the rental and other income,
if any, collected by Lessor in respect of the Demised Premises, or any
part thereof, subject nevertheless to the provisions of Section 14.03,
said amount to be due and payable by Lessee to Lessor on the several
days on which the rent reserved in this Lease would have become due and
payable for the period which otherwise would have constituted the
unexpired portion of the Term (that is to say, upon each of such days
Lessee shall pay to Lessor the amount of deficiency then existing).
36
B. Whether or not Lessor shall have collected any monthly deficiencies
aforesaid, Lessor shall be entitled to recover from Lessee on demand,
as and for liquidated damages, a lump sum payment equal to the amount
by which the Fixed Rent and Additional Rent payable hereunder for the
period which otherwise would have constituted the unexpired portion of
the Term (due account being taken of amounts, if any, collected under
clause [c] of Section 15.01.A, and conclusively presuming the
Additional Rent to be the same as was payable for the year immediately
preceding such termination or re-entry and thereafter increasing by
five (5%) percent per annum) exceeds the then rental value of the
Demised Premises for the same period both discounted at a rate equal to
then applicable Treasury Rate to present value. If the Demised Premises
or any part thereof be relet by Lessor for the unexpired portion of the
Term, or any part thereof, before presentation of proof of such
liquidated damages to any court, commission or tribunal, the amount of
rent reserved upon such reletting shall be deemed PRIMA FACIE to be the
fair and reasonable rental value for the part or the whole of the
Demised Premises so relet during the term of the reletting. Nothing
herein contained shall limit or prejudice the right of the Lessor to
prove for and obtain as damages by reason of such termination an amount
equal to the maximum allowed by any statute or rule of law in effect at
the time when, and governing the proceedings in which, such damages are
to be proved, whether or not such amount be greater or less than the
amount of liquidated damages referred to above (due account to be
taken, however, of the amounts, if any, collected under this Article
15).
SECTION 15.02. In no event shall Lessee be entitled to receive any
excess of the rental and other income collected by Lessor in respect of the
Demised Premises over the sums payable by Lessee to Lessor hereunder. In no
event shall Lessee be entitled in any suit for the collection of damages
pursuant to this Article to a credit in respect of any such rental and other
income, except to the extent that such rental and other income is allocable to
the portion of the Term in respect of which such suit is brought and is actually
received by Lessor prior to the entry of judgment in such suit.
SECTION 15.03. Separate actions may be maintained by Lessor against
Lessee from time to time to recover any damages which, at the commencement of
any such action, have then or theretofore become due and payable to Lessor under
Article 14, without waiting until the end of the Term and without prejudice to
Lessor's right to collect damages thereafter.
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ARTICLE 16 - INDEMNIFICATION
SECTION 16.01. Notwithstanding that joint or concurrent liability may
be imposed upon either party by statute, ordinance, rule, regulation, order or
court decision, and notwithstanding any insurance furnished by either party
pursuant hereto or otherwise, Lessee shall and does hereby indemnify and hold
Lessor and its agents, officers, directors, and employees, harmless from and
against any and all loss, liability, fines, suits, claims, obligations, damages,
penalties, demands and actions, and costs and reasonable expenses of any kind or
nature (including architects', engineers' and attorneys' fees) due to or arising
out of any of the following:
(a) any work or thing done in, on or about the Demised
Premises, Building or the Property or any part thereof or any use,
possession, occupation, condition, operation, maintenance, repair or
management of the Demised Premises, Building or the Property or any
part thereof, by Lessee or anyone claiming through or under Lessee or
the respective employees, agents, licensees, contractors, servants or
sublessees of Lessee or any such person;
(b) any act or omission on the part of Lessee or any person
claiming through or under Lessee, or the respective employees, agents,
licensees, invitees, contractors, servants or sublessees of Lessee or
any such person; or
(c) any accident or injury to any person (including death) or
damage to property (including loss of property) occurring in, on, or
about the Demised Premises, Building or the Property or any part
thereof, due to the act or omission by Lessee, its employees, agents,
licensees, invitees, contractors or servants.
The provisions of this Section 16.01 shall survive the expiration or
termination of this Lease. Any sums payable by Lessee to Lessor under this
Section 16.01 shall be due and payable on demand.
SECTION 16.02. Lessor and Lessor's agents, officers, directors, and
employees shall not be liable for any of the following, however caused, other
than by wilful or negligent acts: (a) failure of any Utility Service, (b) damage
to Lessee's property on the Demised Premises caused by or resulting from any
cause whatsoever, including explosion, falling plaster, vermin, smoke, gasoline,
oil, Hazardous Materials, steam, gas, electricity, earthquake, subsidence of
land, hurricane, tornado, flood, wind or similar storms or disturbances or
water, rain, ice or snow which may be upon, or leak or flow from, any street,
road, parking lot, sewer, gas main or subsurface area, or from any part of the
Property, or leakage of gasoline, oil or other substances from pipes, pipelines,
38
appliances, storage tanks, sewers or plumbing works in or at the Property, or
from any other place, or from the breaking of any electrical wire or the
breaking, bursting or leaking of water or Hazardous Materials from any plumbing
or sprinkler system, or any other pipe or storage tanks in, on, under or about
the Property, (c) interference with light or other incorporeal hereditaments,
and (d) loss by theft or otherwise of Lessee's Property or the property of any
person claiming through or under Lessee. Any employees of Lessor to whom any
property shall be entrusted by or on behalf of Lessee shall be deemed to be
acting as Lessee's agents with respect to such property and neither Lessor nor
Lessor's agents shall be liable for any loss or for damage to any such property
by theft or otherwise. This Section 16.02 shall not be construed as a provision
for indemnification.
SECTION 16.03. Except as otherwise provided for in this Lease, Lessor
shall and does hereby indemnify and hold harmless Lessee and Lessee's agents
from and against any and all loss, liability, fines, suits, claims, obligations,
damages, penalties, demands and actions, and costs and reasonable expenses of
any kind or nature (including architects' and attorneys' fees) due to or arising
out of the breach of this Lease, negligence or willful misconduct of Lessor, its
agents, officers, directors and employees. In case of any obligation of Lessor
to indemnify Lessee pursuant to this Section, such obligation shall be subject
to and conditioned upon (x) the receipt by Lessor of prompt written notice of
the claim with respect to which indemnification is sought and (y) Lessor's
having had reasonable opportunity to conduct the defense of such claim in such
manner as it deems appropriate, with the full cooperation of Lessee, and using
counsel reasonably acceptable to Lessor.
ARTICLE 17 - MECHANIC'S AND OTHER LIENS
SECTION 17.01. If any mechanic's, laborer's or materialman's lien shall
be at any time be filed against the Demised Premises, Building or Property, or
any part thereof with respect to any work done, or caused to be done, or labor
or materials furnished, or caused to be furnished, by Lessee or anyone claiming
through or under Lessee, Lessee, within thirty (30) days after notice of the
filing thereof, shall cause the same to be discharged of record by payment,
deposit, bond, order of a court of competent jurisdiction or otherwise. If
Lessee shall fail to cause such lien to be discharged within the period
aforesaid, then, in addition to any other right or remedy, Lessor may, but shall
not be obligated to, discharge the same by bonding proceedings, if permitted by
law (and if not so permitted, by deposit in court). Any amount so paid by
Lessor, including all costs and expenses paid by Lessor in connection therewith,
39
together with interest thereon at the maximum legal rate from the respective
dates of Lessor's so paying any such amount, cost or expense, shall constitute
Additional Rent payable by Lessee under this Lease and shall be paid by Lessee
to Lessor on demand.
ARTICLE 18 - CONDEMNATION
SECTION 18.01. If the whole of the Demised Premises, or such part
thereof as will render the remainder Untenantable, shall be acquired or
condemned for any public or quasi-public use or purpose, this Lease and the Term
shall end as of the date of vesting of title in the condemning authority with
the same effect as if said date were the Expiration Date. If only a part of the
Demised Premises shall be so acquired or condemned then, except as otherwise
provided in this Article, this Lease and the Term shall continue in force and
effect but, from and after the date of the vesting of title, the Fixed Rent
shall be an amount which bears the same ratio to the Fixed Rent payable
immediately prior to such condemnation pursuant to this Lease as the value of
the untaken portion of the Demised Premises (appraised after taking and repair
of any damage to the Demised Premises pursuant to this Section) bears to the
value of the entire Demised Premises immediately before the taking. The value of
the Demised Premises before and after the taking shall be determined for the
purposes of this Section by an independent licensed appraiser chosen by Lessor.
If more than sixty (60%) percent of the total area of the Building included in
the Demised Premises immediately prior to acquisition or condemnation is so
acquired or condemned, or if by reason of such acquisition or condemnation,
Lessee no longer has reasonable means of access to the Demised Premises, then in
such event, either party, may give notice to the other party within sixty (60)
days next following the date upon which Lessee have received notice of vesting
of title, thirty (30) days notice of termination of this Lease. In the event any
such thirty (30) day notice of termination is given by Lessor or Lessee, this
Lease and the Term shall terminate upon the expiration of said thirty (30) days
with the same effect as if that date were the Expiration Date. If a part of the
Demised Premises shall be so acquired or condemned, and the Term shall not be
terminated pursuant to the provisions of this Section, Lessor, at Lessor's
expense, shall restore that part of the Demised Premises not so acquired or
condemned to a self-contained unit. In the event of any termination of this
Lease and the Term pursuant to the provisions of this Section, the Fixed Rent
and Additional Rent shall be apportioned as of the date of sooner termination
and any prepaid portion of the Fixed Rent and Additional Rent for any period
after such date shall be refunded by Lessor to Lessee, subject to the claims, if
any, of Lessor against Lessee hereunder or otherwise.
40
SECTION 18.02. In the event of any acquisition or condemnation of all
or part of the Demised Premises for any public or quasi-public use or purpose,
Lessor shall be entitled to receive the entire award for such acquisition or
condemnation, Lessee shall have no claim against Lessor or the condemning
authority for the value of any unexpired portion of the Term and Lessee hereby
expressly assigns to Lessor all of its right, title and interest in and to any
such award, and also agrees to execute any and all further documents that may be
required in order to facilitate the collection thereof by Lessor. Nothing
contained in this Section shall be deemed to prevent Lessee from making a
separate claim in any condemnation proceeding for moving expenses and for the
value of any Lessee's Property which would be removable at the end of the Term
pursuant to the provisions hereof, directly against any governmental authority
authorized to exercise the power of eminent domain, provided that applicable
statutes permit such awards and any award to Lessor is not diminished or
adversely affected thereby.
SECTION 18.03. The terms "condemnation" and "acquisition" as used in
this Article shall include any agreement in lieu of or in anticipation of the
exercise of the power of eminent domain between Lessor and/or any Superior
Mortgage and any governmental authority authorized to exercise the power of
eminent domain.
ARTICLE 19 - COVENANT OF QUIET ENJOYMENT
SECTION 19.01. If and so long as no Event of Default shall have
occurred and be continuing, Lessor covenants and agrees that Lessee may
peaceably and quietly enjoy the Demised Premises and Lessee's possession of the
Demised Premises will not be disturbed by Lessor, its successors and assigns,
subject, however, to the terms of this Lease (including those set forth in
Sections 24.01 and 24.02), the Mortgage, Superior Lease and any and/or all other
agreements and any amendments thereto, to which this Lease is subordinated.
ARTICLE 20 - WAIVER OF COUNTERCLAIM AND JURY TRIAL
SECTION 20.01. In the event that Lessor shall commence any summary or
other proceedings or action for non-payment of rent hereunder, Lessee shall not
interpose any counterclaim of any nature or description in such proceeding or
action, unless such non-interposition would effect a waiver of Lessee's right to
assert such claim against Lessor in a separate action or proceeding. The parties
hereto waive a trial by jury on any and all issues arising in any action or
proceeding between them or their successors under or in any way connected with
this Lease or any of its provisions, any negotiations in connection therewith,
the relationship of Lessor and Lessee, or Lessee's use or occupation of the
Demised Premises, including any claim of injury or any emergency or other
statutory remedy with respect thereto. The provisions of this Article shall
survive the expiration or other termination of this Lease.
41
ARTICLE 21 - NOTICES
SECTION 21.01. A. Except as otherwise expressly provided in this Lease,
any bills, statements, notices, demands, requests, consents or other
communications given or required to be given under this Lease shall be effective
only if rendered or given in writing and
(a) If to Lessee, then, at the option of Lessor, (i) addressed
to Lessee's address as set forth in this Lease, with copies thereof to
[SCHULTE ROTH & ZABEL, 919 THIRD AVENUE, NEW YORK, NEW YORK 10022,
ATTENTION: GEORGE SILFEN, ESQ.,] or to such other address as Lessee may
designate as its new address for such purpose by notice given to Lessor
in accordance with the provisions of this Section, or (ii) delivered
personally to Lessee, or (iii) by overnight courier,
(b) If to Lessor, sent by personal delivery or overnight
courier, addressed to Lessor at Lessor's address as set forth in this
Lease, with copies thereof to Steven C. Hirsch, Esq., 585 Stewart
Avenue, Suite 430, Garden City, New York 11530, or to such other
address as Lessor may designate as its new address for such purpose by
notice given to Lessee in accordance with the provisions of this
Section.
B. Any such bill, statement, notice, demand, request, consent or other
communication shall be deemed to have been rendered or given: (i) on the date
delivered, if delivered to Lessee personally, or by overnight courier and (ii)
on the expiration of five (5) days after mailing, if mailed to Lessor or Lessee
as provided in this Section. Any notice by a party signed by counsel for such
party shall be deemed a notice signed by such party.
ARTICLE 22 - WAIVERS AND SURRENDERS TO BE IN WRITING
SECTION 22.01. The receipt of full or partial rent by Lessor with
knowledge of any breach of this Lease by Lessee or of any default on the part of
the Lessee in the observance or performance of any of the provisions or
covenants of this Lease shall not be deemed to be a waiver of any such
provision, covenant or breach of this Lease PROVIDED, HOWEVER, that acceptance
of a payment of rent shall be valid PRO TANTO. No waiver or modification by
42
Lessor, unless in writing, and signed by Lessor, shall discharge or invalidate
any provision or covenant or affect the right of Lessor to enforce the same in
the event of any subsequent breach or default. The failure on the part of Lessor
to insist in any one or more instances upon the strict performance of any of the
provisions or covenants of this Lease, or to enforce any covenant or provision
herein contained or to exercise any right, remedy or election herein contained
consequent upon a breach of any provision of this Lease, shall not affect or
alter this Lease or be construed as a waiver or relinquishment for the future of
such one or more provisions or covenants or of the right to insist upon strict
performance or to exercise such right, remedy or election, but the same shall
continue and remain in full force and effect with respect to any existing or
subsequent breach, act or omission, whether of a similar nature or otherwise.
The receipt by Lessor of any rent or any other sum of money or any other
consideration hereunder paid by Lessee after the termination, in any manner, of
the Term, or after the giving by Lessor of the Termination Notice, shall not
reinstate, continue or extend the Term, or destroy, or in any manner impair the
efficacy of any such Termination Notice, as may have been given hereunder by
Lessor to Lessee prior to the receipt of any such rent, or other sum of money or
other consideration, unless so agreed to in writing and signed by Lessor.
Neither acceptance of the keys or any other act or thing done by Lessor or any
agent or employee shall be deemed to be an acceptance of a surrender of the
Demised Premises, or any part thereof, excepting only an agreement in writing
signed by Lessor. No payment by Lessee or receipt by Lessor of a lesser amount
than the correct rent shall be deemed to be other than a payment on account, nor
shall any endorsement or statement on any check, as distinguished from any
letter accompanying such check or payment, be deemed to effect or evidence an
accord and satisfaction, and Lessor may accept such check or payment without
prejudice to Lessor's right to recover the balance or pursue any other remedy in
this Lease provided.
ARTICLE 23- RIGHTS CUMULATIVE
SECTION 23.01. Each right and remedy of Lessor shall be cumulative and
to the extent permitted by law, the exercise or beginning of the exercise by
Lessor of any one or more of the rights or remedies of such party shall not
preclude the simultaneous or later exercise by Lessor of any or all other rights
or remedies; PROVIDED, HOWEVER, that this sentence shall not be construed to
entitle Lessor to satisfaction of more than one remedy in respect of a
particular breach. In the event of any breach or threatened breach by Lessee or
any persons claiming through or under Lessee of any of the agreements, terms,
covenants or conditions contained in this Lease, Lessor shall be entitled to
enjoin such breach or threatened breach (if entitled to do so at law or in
equity or by statue or otherwise) and shall have the right to invoke any right
or remedy allowed by law or in equity or by statute or otherwise as if re-entry,
summary proceedings or other specific remedies were not provided for in this
Lease.
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ARTICLE 24- CONVEYANCE; LIABILITY OF PARTIES
SECTION 24.01. The term "Lessor" as used herein shall mean and include
only the owner or owners at the time in question of the Lessor's interest in
this Lease so that in the event of any transfer or transfers (by operation of
law or otherwise) of Lessor's entire interest in this Lease, Lessor herein named
(and in the case of any subsequent transfers or conveyances, the then
transferor) shall be and hereby is automatically freed and relieved, from and
after the date of such transfer or conveyance, of all liability in respect of
the performance of any covenants or obligations on the part of the Lessor
contained in this Lease thereafter to be performed, provided that the transferee
shall be deemed to have assumed and agreed to perform subject to the limitation
of this Article (and without further agreement between or among the parties or
their successors in interest, and/or the transferee) and only during and in
respect of the transferee's period of ownership, all of the terms, covenants and
conditions in this Lease contained on the part of Lessor to be performed, which
terms, covenants, and conditions shall be deemed to "run with the land", it
being intended hereby that the terms, covenants and conditions contained in this
Lease on the part of the Lessor to be performed shall, subject as aforesaid, be
binding on Lessor, its successors and assigns, only during and in respect of
their respective successive periods of ownership.
SECTION 24.02. In the event of a breach by Lessor of any provisions,
covenants or obligations of this Lease to be performed by Lessor, the monetary
liability of Lessor in relation to any such breach shall be limited to the
equity of Lessor in the Demised Premises, and Lessee shall look only to Lessor's
equity in the Demised Premises for the performance and observance of the terms,
covenants, conditions and obligations of this Lease to be performed or observed
by Lessor and for the satisfaction of Lessee's remedies for the collection of
any award, judgment or other judicial process requiring the payment of money by
Lessor in the event of a default in the full and prompt payment and performance
of any Lessor's obligations hereunder and in no event shall any of the partners
constituting Lessor (the "Partners"), nor the partners, shareholders, officers
or directors of Lessor or the Partners shall be liable for the performance of
Lessor's obligations under this Lease, nor shall any of the Partners assets be
liable to any levy, execution, restraint, award, claim of any kind whatsoever
arising out of, or in any way related to this Lease.
44
SECTION 24.03. The term "Lessee" as used in this Lease shall mean and
include Lessee named herein and, during and in respect of their respective
successive periods of ownership, each subsequent owner or owners of the
leasehold estate created by this Lease. For all purposes of this Lease and
without affecting the rights of, and obligations between, Lessee herein named
and any transferee, notwithstanding any transfer (by operation or law or
otherwise) of title to the leasehold estate created by this Lease by Lessee
herein named or by any subsequent owner of such estate and notwithstanding the
assumption by any transferee of the obligations of the Lessee hereunder, Lessee
herein named, as between Lessor and Lessee herein named, shall remain primarily
liable as primary obligor and not as a surety, for the full and prompt payment
and performance of Lessee's obligations hereunder and, without limiting the
generality of the foregoing or of Article 28, shall remain fully and directly
responsible and liable to Lessor for all acts and omissions on the part of any
transferee subsequent to it in violation of any obligation of this Lease.
ARTICLE 25- CHANGES AND ALTERATIONS BY LESSEE
SECTION 25.01.A. Lessee shall have no right to make any alteration,
change, additions or improvement, structural or otherwise (an "Alteration"), to
the Demised Premises or any appurtenances thereto without the prior written
consent of Lessor in each instance, which consent shall not be unreasonably
withheld.
B. If Lessor shall grant its consent to the making of an Alteration,
then the same shall (i) be performed at the sole cost and expense of Lessee,
(ii) be performed in a good and workmanlike manner, and in compliance with all
applicable Legal Requirements (including existing zoning requirements),
Insurance Requirements and Environmental Laws, (iii) be consistent with the use
of the Demised Premises provided for herein, (iv) not in any way render the
Demised Premises other than a complete, self containing operating unit, (v) in
the case of a structural alteration, be performed in accordance with plans and
specifications approved prior to the commencement of any work by the appropriate
Governmental Authorities and by Lessor, (vi) be of such nature so as not to
lessen the fair market value of the Demised Premises, and (vii) be performed
under the supervision of a licensed architect approved by Lessor and in
accordance with Lessor's STANDARD REQUIREMENTS FOR ALTERATIONS TO BE PERFORMED
BY LESSEES', as may be amended from time to time.
45
SECTION 25.02.A. Any and all Alterations made in accordance with
Section 25.01 shall immediately become the property of Lessor, PROVIDED,
HOWEVER, that if, in accordance with the provisions of Sections 25.02.B and
29.02, Lessee shall have the option to and shall remove its trade fixtures,
provided that same are not affixed to or such removal would otherwise damage the
Demised Premises, then the same shall cease to be property of the Lessor upon
removal.
B. Unless Lessor shall otherwise expressly indicate in writing at the
time of granting its consent to the making of a proposed Alteration, Lessee
shall, as and when provided in Section 29.02, restore the affected portion of
the Demised Premises to the state or condition thereof existing prior to the
making of such Alteration.
C. Any and all contractors to be involved in performing work shall be
subject to Lessor's prior approval, which shall not be unreasonably withheld.
D. Prior to commencing any work at the Demised Premises, Lessee shall
furnish Lessor with evidence reasonably satisfactory to Lessor of such insurance
as Lessor may require and such insurance shall be in full force and effect
during such work and will cover, by endorsement or otherwise, the risk during
the course of such work.
E. In the event of any Alteration as provided for in this Article, the
Rent payable hereunder shall not be reduced or abated in any manner whatsoever.
F. No Alterations shall involve the removal of any fixtures, equipment
or other property in the Demised Premises which are not Lessee's property,
unless Lessor's prior written consent is first obtained and unless such
fixtures, equipment or other property shall be promptly replaced, at Lessee's
expense and free of superior title, liens and claims, with fixtures, equipment
or other property (as the case may be) of like utility and at least equal value
(which replaced fixtures, equipment or other property shall thereupon become the
property of Lessor), unless Lessor shall otherwise expressly consent in writing.
SECTION 25.03. Notwithstanding anything herein to the contrary, Lessor
shall have the option of performing any and all Alterations pursuant to Article
25 of this Lease on Lessee's behalf and at Lessee's Cost.
46
ARTICLE 26 - CERTIFICATE OF LESSEE
SECTION 26.01. Lessee agrees at any time and from time to time, within
twenty (20) days after request by Lessor, to execute, acknowledge and deliver a
statement certifying (i) the Commencement Date hereunder, (ii) that this Lease
is unmodified and in full force and effect (or if there have been modifications,
that the Lease is in full force and effect as modified and stating the
modifications), (iii) the dates to which the Fixed Rent and Additional Rent have
been paid, and (iv) whether or not to the knowledge of the signer of such
statement (a) Lessor is in default in keeping, observing or performing any term,
covenant, agreement, provision, condition or limitation contained in this Lease
and, if in default, specifying each such default, (b) either party is holding
any funds under this Lease in which the other has an interest (and, if so,
specifying the party holding such funds and the nature and amount thereof), and
(c) there is any amount then due and payable to Lessee by Lessor, it being
intended that any such statement delivered pursuant to this Section may be
relied upon by Lessor, any mortgagee, superior lessor or any person who may and
does become a mortgagee, superior lessee, any person who may and does become a
purchaser or assignee of Lessor's interest in this Lease or the mortgagee's
interest in any mortgage or the lessor's interest in the Superior Lease.
ARTICLE- 27 ASSIGNMENTS, SUBLEASES AND MORTGAGES
SECTION 27.01.A. Except as otherwise specifically provided in this
Article, neither this Lease, nor the Term and estate hereby granted, nor any
part thereof, nor the interest of Lessee in any sublease or the rental
thereunder, shall be assigned, mortgaged, pledged, encumbered or otherwise
transferred by Lessee or Lessee's legal representatives or successors in
interest, by operation of law or otherwise, and neither the Demised Premises,
nor any part thereof, nor any Lessee's Property, shall be encumbered in any
manner by reason of any act or omission on the part of Lessee or anyone claiming
under or through Lessee, or shall be sublet or be used or occupied or permitted
to be used or occupied or utilized for desk or storage space by anyone other
than Lessee or for any purpose other than as specifically permitted by this
Lease, without the prior written consent of Lessor in each case, which consent
shall not be unreasonably withheld, conditioned or delayed. If Lessee is other
than a public company, a transfer (including any issuance of stock) of an
aggregate of fifty (50%) percent or more stock, partnership interest or other
equity interest in Lessee by any party or parties in interest shall be deemed an
assignment of this Lease.
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B. If Lessee herein named is a corporation, upon at least Sixty (60)
days prior notice to Lessor, this Lease in its entirety may be assigned without
Lessor's consent to a corporation into which Lessee merges or consolidates, or
which controls, is controlled by or under common control with Lessee, so long as
the Demised Premises continue to be used for the use described in Article 4 of
this Lease; the transfer is not principally for the purpose of transferring the
leasehold estate created hereby; the net worth of the assignee is at least equal
to or in excess of the net worth of Lessee at the time of execution of this
Lease and immediately prior to such assignment or the assignee can otherwise
secure and guaranty the payment to Lessor or all rent and any other amounts due
from Lessee pursuant to this Lease in a manner reasonably satisfactory to
Lessor; the assignee assumes by documents satisfactory to Lessor all of Lessee's
obligations to be performed under this Lease, and; provided such assignment
shall be subject to all of the other terms and conditions of this Lease.
SECTION 27.02. If this Lease be assigned, whether or not in violation
of the provisions of this Lease, Lessor may collect rent from the assignee, and
Lessor shall be entitled to receive, as Additional Rent, one half of all of the
excess consideration paid to Lessee in connection with such assignment as shall
for any period exceed the aggregate of the Rents payable under this Lease (the
"Excess Consideration"). Such Excess Consideration shall be reduced by the
reasonable cost of tenant improvements, brokerage commissions and attorneys'
fees and disbursements reasonably incurred by Lessee for such assignment, and
the net amount thereof shall be paid to Lessor either: (i) in a lump sum, (ii)
or allocated to such period on a straight line basis over the term of such
assignment if paid in installments, as the case may be, promptly after receipt
thereof by Lessee. The provisions of the preceding sentence shall be in full
force and effect notwithstanding that Lessee has sought the protection of any
provisions of the bankruptcy law (as hereinafter defined) or if a petition has
been filed against Lessee under such bankruptcy law. If the Demised Premises or
any part thereof be sublet or be used or occupied by anybody other than Lessee,
whether or not in violation of this Lease, Lessor may, after default by Lessee
and expiration of Lessee's time to cure such default, if any, collect rent from
the sublessee or occupant. In either event, Lessor may apply the net amount
collected to the rents herein reserved, but no such assignment, subletting,
occupancy or collection shall be deemed a waiver of any of the provisions of
Section 27.01, or the acceptance of the assignee, sublessee or occupant as
tenant, or a release of Lessee from the further performance by Lessee of
Lessee's obligations under this Lease. The consent by Lessor to an assignment,
mortgaging or subletting pursuant to any provision of this Lease shall not in
any way be considered to relieve Lessee from obtaining the express consent of
48
Lessor for any other or further assignment, mortgaging or subletting. References
in this Lease to use or occupancy by anyone other than Lessee shall not be
construed as limited to sublessees and those claiming under or through
sublessees but as including also licensees and other claiming under or through
Lessee, immediately or remotely. The listing of any name other than that of
Lessee on any door of the Demised Premises or on any sign on the Demised
Premises, or otherwise, shall not operate to vest in the person so named any
right or interest in this Lease or in the Demised Premises, or be deemed to
constitute, or serve as a substitute for, any prior consent of Lessor required
under this Article, and it is understood that any such listing shall constitute
a privilege extended by Lessor which shall be revocable at Lessor's will by
notice to Lessee. Lessee agrees to pay to Lessor any reasonable counsel fees
incurred by Lessor in connection with any proposed assignment of Lessee's
interest in this Lease or any proposed subletting of the Demised Premises or any
part thereof. Neither any assignment of Lessee's interest in this Lease nor any
subletting, occupancy or use of the Demised Premises or any part thereof by any
person other than Lessee as provided in this Article, nor any application of any
such rent as provided in this Article shall, under any circumstances, relieve
Lessee herein named of its obligations fully to observe and perform the terms,
covenants and conditions of this Lease on Lessee's part to be observed and
performed.
SECTION 27.03. A. Notwithstanding anything contained in Sections 27.01
and 27.02, in the event that, at any time or from time to time during the Term,
Lessee desires to sublet all or any part of the Demised Premises, Lessee shall
notify Lessor of such desire and shall: (i) submit to Lessor in writing the name
and address of the proposed subtenant, a reasonably detailed statement of the
proposed subtenant's business, reasonably detailed financial references for the
proposed subtenant and any other information reasonably requested by Lessor, and
(ii) submit to Lessor a copy of the proposed sublease.
B. If a proposed assignment or sublease requires Lessor's consent, then
upon receipt of such notice, Lessor shall thereupon have the option and right,
exercisable within Ten (10) days of receipt of such notice from Lessee, to
terminate this Lease with respect to the portion to be assigned or subleased
effective as of a date specified by Lessor in such notice which date shall not
be later than Thirty (30) days after the date of Lessor's notice.
49
C. If within thirty (30) days after Lessee shall have requested the
consent of Lessor to any assignment or subletting under this Article, and shall
have submitted all items required hereby, Lessor does not exercise its option to
terminate this Lease, the term of the proposed assignment or sublease may
commence upon Lessor's consent, which consent may not be unreasonably withheld,
it being agreed that if within such thirty (30) day period Lessor does not
advise Lessee that such consent is granted, such consent shall be deemed granted
by Lessor. Lessor, however, shall not in any event be obligated to consent to
the proposed sublease or the commencement of the term unless: (i) in the
reasonable judgment of Lessor the proposed subtenant is of a character and
financial worth such as is in keeping with the standards of Lessor in those
respects for the Demised Premises, and the nature of the proposed subtenant's
business and its reputation are in keeping with the character of the Demised
Premises and the use thereof, (ii) the purpose for which the proposed subtenant
intends to use the portion of the Demised Premises sublet to it are uses
expressly permitted by and not expressly prohibited by this Lease; (iii) the
proposed sublease shall prohibit any assignment or subletting; (iv) no Event of
Default shall have occurred and be continuing and (v) Lessee shall reimburse
Lessor for all reasonable costs that may be incurred by Lessor in connection
with the said sublease, including the costs of making investigations as to the
acceptability of a proposed subtenant and legal costs incurred in connection
with the granting of any requested consent.
D. With respect to each and every subletting authorized by the
provisions of this Article it is further agreed and understood between Lessor
and Lessee that: (i) the subletting shall be, and each such sublease shall
expressly provide that is, subject and subordinate at all times and in all
respects, to this Lease, (ii) no subletting shall be for a term ending later
than one day prior to the Expiration Date originally provided for herein and
that part, if any, of the proposed term of any sublease which shall extend
beyond a date one day prior to the Expiration Date originally provided for
herein (or any sooner date of the expiration of the term or termination of this
Lease) is hereby deemed to be a nullity, (iii) there shall be delivered to
Lessor, within ten (10) days after the commencement of the term of the proposed
sublease, notice of such commencement and a fully executed copy of the proposed
sublease (unless previously submitted) and (iv) Lessee shall pay to Lessor, as
Additional Rent, one half of all of the Excess Consideration.
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E. Anything herein contained to the contrary notwithstanding: (i)
Lessee shall not advertise but may list its space for subletting or assignment,
and may list its space at a rental rate lower than the rental rate then being
paid by Lessee to Lessor only with respect to subletting (but not assignment)
and (ii) No assignment or subletting shall be made to any person or entity which
shall at that time otherwise be a tenant, sub-tenant or other occupant of any
part of the Property or which shall within the prior Four (4) months have been
negotiating with Lessor to become such a tenant, sub-tenant or occupant of the
Property.
ARTICLE 28 - SUBORDINATION
SECTION 28.01. This Lease, and all rights of Lessee hereunder, are and
shall be subject and subordinate in all respects to (a) all present and future
ground leases, overriding leases and underlying leases and/or grants of term of
the Property, the Building, the Building Equipment and/or any appurtenance
thereto of which Lessor has notified Lessee (collectively, the "Superior
Lease"), (b) all mortgages and building loan agreements, including leasehold
mortgages, deeds of trust, and building loan agreements, which may now or
hereafter affect the Property, the Building, the Building Equipment and/or any
appurtenance thereto, of which Lessor has notified Lessee (collectively, the
"Mortgage"), whether or not the Mortgage shall also cover other land and/or
buildings, and (c) each and every advance made or hereafter to be made under the
Mortgage and to all renewals, modifications, replacements, substitutions and
extensions of any Superior Lease and the Mortgage and spreaders and
consolidations of the Mortgage. The provisions of this Section shall be
self-operative and no further instrument of subordination shall be required. In
confirmation of such subordination, Lessee shall promptly execute and deliver,
at its own cost and expense, an instrument in recordable form to evidence such
subordination. If, in connection with the obtaining, continuing or renewing of
financing for which the Demised Premises or the interest of the lessee under the
Superior Lease represents collateral in whole or in part, a bank, insurance
company or other lender shall request reasonable modifications of this Lease as
a condition of such financing, Lessee will not unreasonably withhold or delay
its consent thereto, provided that such modifications do not increase the
monetary obligations of Lessee under this Lease or materially increase the other
obligations of Lessee hereunder or materially and adversely affect the rights of
Lessee under this Lease. Lessor represents that as of the date hereof, the
Property is not encumbered by a Superior Lease or Mortgage.
51
SECTION 28.02. If at any time prior to the expiration of the Term, the
holder of the Mortgage shall become the owner of the Demised Premises as a
result of foreclosure of its mortgage or by reason of an assignment of the
lessee's interest under any such lease or conveyance of the Demised Premises,
Lessee agrees, at the election and upon demand of any owner of the Demised
Premises, or of the holder of any Mortgage or Superior Lease (including a
leasehold mortgage) in possession of the Demised Premises, to attorn, from time
to time, to any such owner, or lessee, upon the then executory terms and
conditions of this Lease, provided that such owner, holder or lessee, as the
case may be, shall then be entitled to possession of the Demised Premises. No
such owner, holder or lessee shall be liable for any previous acts or omission
of Lessor under this Lease (except that this provision shall not be construed to
relieve such person from any obligation thereafter to be performed), nor shall
such owner holder or Lessee be subject to any offset which shall have
theretofore accrued to Lessee against Lessor, or be bound by any previous
modification of this Lease, not expressly provided for in this Lease, entered
into after the date of the Mortgage, or Superior Lease, or by any previous
prepayment of more than one month's Fixed Rent. The foregoing provisions of this
Section shall enure to the benefit of any such owner, holder or lessee, shall
apply notwithstanding that, as a matter of law, this Lease may terminate upon
the termination of the Superior Lease, or the foreclosure (including judgment of
foreclosure and sale) of the Mortgage, shall be self-operative upon any such
demand, and no further instrument shall be required to give effect to said
provisions. Lessee, however, upon demand of any such owner, holder or lessee,
agrees to execute, from time to time, instruments in confirmation of the
foregoing provisions of this Section, acknowledging such attornment and setting
forth the terms and conditions of its tenancy. Nothing contained in this Section
shall be construed to impair any right otherwise exercisable by any such owner,
holder or lessee.
ARTICLE 29 - SURRENDER; REMOVAL OF LESSEE'S PROPERTY
SECTION 29.01. On the last day of the Term or on the earlier
termination of the Term, Lessee shall peaceably and quietly leave, surrender and
deliver the Demised Premises to Lessor, together with (a) all alterations,
changes, additions and improvements, which may have been made upon the Demised
Premises, and (b) except for Lessee's Property, all fixtures and articles of
personal property of any kind or nature which Lessee may have installed or
affixed on, in, or to the Demised Premises for use in connection with the
operation and maintenance of the Demised Premises (whether or not said property
be deemed to be fixtures), all of the foregoing to be surrendered in good,
substantial and sufficient repair, order and condition, reasonable use, wear and
tear, and damage by fire or other casualty, excepted, and free of occupants and
sublessees.
SECTION 29.02. On or prior to the Expiration Date or any earlier
termination of this Lease, Lessee shall remove Lessee's Property, and any items
referred to in clauses (a) or (b) of Section 29.01, which Lessor shall request
Lessee to remove (unless Lessor shall have waived such right as to any item
referred to in clause (a) of Section 29.01 at the time of the granting of
consent with respect thereto under Article 25), and Lessee shall pay or cause to
be paid the cost of repairing or remedying any damage caused thereby, provided
that no item of Lessee's Property may be removed if its removal would impair the
integrity (structural or otherwise) of the Building or Building Equipment. All
property not so removed shall be deemed abandoned and may either be retained by
Lessor as its property or disposed of, without accountability, at Lessee's sole
cost, expense and risk, in such manner as Lessor may see fit.
52
SECTION 29.03. If the Demised Premises are not surrendered in
accordance with the provisions of this Article upon the expiration or
termination of this Lease, Lessor shall have all rights given at law or in
equity, in the case of holdovers, to remove Lessee and anyone claiming through
or under Lessee. In any event, Lessee shall and does hereby indemnify Lessor
against all loss or liability arising from delay by Lessee in so surrendering
the Demised Premises, including any claims made by any succeeding lessees
founded on such delay. Lessee expressly waives, for itself and for any person
claiming through or under Lessee (including creditors), any rights which lessee
or any such person may have under the provisions of any law in connection with
any holdover summary proceedings which Lessor may institute to enforce the
provisions of this Article. Lessee's obligations under this Article shall
survive the expiration or termination of this Lease.
SECTION 29.04. Lessee acknowledges the extreme importance to Lessor
that possession of the Demised Premises be surrendered at the expiration or
sooner termination of this Lease. In the event that Lessee fails to vacate the
Demised Premises at the expiration or sooner termination of this Lease, or fails
to notify Lessor of its option to extend this Lease for the Extension Term (as
hereinafter defined), Lessee shall be obligated to pay Lessor damages in an
amount equal to Two Hundred (200%) percent of the annual Fixed Rent and
Additional Rent provided for on the day preceding the Expiration Date for such
period of time that Lessee holds over on a per diem basis.
ARTICLE 30 - RENEWAL TERM
SECTION 30.01. Lessee named herein, shall have the right, at its
option, to extend this Lease for a term ("Renewal Term") of Five (5) years (to
commence on the Expiration Date originally provided for herein and to end at
noon on the Fifth (5th) anniversary of such Expiration Date originally provided
for herein) by giving Lessor notice of such election at any time but not less
than Six (6) months prior to the Expiration Date originally provided for herein
(time being of the essence with respect thereto), and upon the giving of such
notice this Lease thereupon shall, subject to the provisions of Section 30.02,
be automatically extended for the Renewal Term with the same force and effect as
if the Renewal Term had been originally included in the Term, without the
execution of any further instrument.
SECTION 30.02. Any notice of election to exercise the option to extend
as hereinbefore provided must be in writing and sent to Lessor as provided in
Article 21. Neither the option granted to Lessee in this Article to extend the
Term, nor the exercise of such option by Lessee, named herein shall prevent
Lessor from exercising any option or right granted or reserved to Lessor in this
53
Lease to terminate this Lease, and the effective exercise of any such right of
termination by Lessor shall terminate any such renewal or extension and any
right of Lessee to any such renewal or extension, whether or not Lessee shall
have exercised any such option to extend the Term. Any such option or right on
the part of Lessor to terminate this Lease pursuant to the provisions hereof
shall continue during any Renewal Term.
SECTION 30.03. All of the terms, covenants and conditions of this Lease
shall continue in full force and effect during the Renewal Term except that (i)
the Fixed Rent for the Renewal Term shall be as provided in Section 30.04 (all
other rent and charges payable by Lessee remaining unaffected), and (b) there
shall be no further privilege of extension of this Lease beyond the Renewal
Term.
SECTION 30.04. During the Renewal Term, Lessee shall pay to Lessor
annual Fixed Rent, at the same times and in the same manner as in the Term
originally provided for, as follows:
A. During and in respect of the period from December 1, 2005
through November 30, 2006 (both dates inclusive), an amount equal to
Fifty-Eight Thousand, Three Hundred and Ninety and 08/100 ($58,390.08)
Dollars (inclusive of electric) payable in equal monthly installments
of Four Thousand, Eight Hundred and Sixty-Five and 84/100 ($4,865.84)
Dollars (inclusive of electric); and
B. During and in respect of the period from December 1, 2006
through November 30, 2007 (both dates inclusive), an amount equal to
Sixty Thousand, Eighteen and 00/100 ($60,018.00) Dollars (inclusive of
electric) payable in equal monthly installments of Five Thousand, One
and 50/100 ($5,001.50) Dollars (inclusive of electric); and
C. During and in respect of the period from December 1, 2007
through November 30, 2008 (both dates inclusive), an amount equal to
Sixty-One Thousand, Six Hundred and Ninety-Four and 76/100 ($61,694.76)
Dollars (inclusive of electric) payable in equal monthly installments
of Five Thousand, One Hundred and Forty-One and 23/100 ($5,141.23)
Dollars (inclusive of electric).
54
D. During and in respect of the period from December 1, 2008
through November 30, 2009 (both dates inclusive), an amount equal to
Sixty-Three Thousand, Four Hundred and Twenty-One and 80/100
($63,421.80) Dollars (inclusive of electric) payable in equal monthly
installments of Five Thousand, Two Hundred and Eighty-Five and 50/100
($5,285.50) Dollars (inclusive of electric); and
E. During and in respect of the period from December 1, 2009
through November 30, 2010 (both dates inclusive), an amount equal to
Sixty-Five Thousand, Two Hundred and 68/100 ($65,200.68) Dollars
(inclusive of electric) payable in equal monthly installments of Five
Thousand, Four Hundred and Thirty-Three and 39/100 ($5,433.39) Dollars
(inclusive of electric).
ARTICLE 31- THIS ARTICLE HAS BEEN INTENTIONALLY OMITTED
ARTICLE 32- BROKERS
SECTION 32.01. Lessee and Lessor each represent that in connection with
this Lease it dealt with no broker, other than FMB Real Estate Services, Inc.
(the "Brokers") nor has Lessee or Lessor had any correspondence or other
communication in connection with this Lease with any other person who is a
broker, and that so far as Lessee and Lessor are aware the Brokers are the only
brokers who negotiated this Lease. Each party hereby indemnifies the other party
and holds it harmless from any and all loss, cost, liability, claim, damage, or
expense (including court costs and attorneys' fees) arising out of any
inaccuracy of the above representation. Lessor agrees to pay the Brokers all
commissions due for its services pursuant to a separate written agreement.
ARTICLE 33- RIGHT OF FIRST OFFER
SECTION 33.01.A. From and after the Commencement Date, Lessor agrees
that prior to offering for lease any contiguous space on the Third (3rd) floor
of the Building (subject to the rights of other lessees), it shall give Lessee
notice of and the right to, at its option, expand the Demised Premises herein to
include all such additional space (the "Additional Space") with occupancy to
commence on the Additional Space Commencement Date (as hereinafter defined) and
to end on the Expiration Date originally provided for herein.
55
B. Lessee shall, within Ten (10) days after receipt of the notice from
Lessor that the Additional Space will become available for hire, notify Lessor
of its intention to lease the Additional Space (time being of the essence with
respect thereto). Lessee's failure to notify Lessor within the Ten (10) day
period shall be deemed a waiver of the right to hire the Additional Space. In
the event that Lessee shall elect to hire the Additional Space, same shall be
deemed added to and a part of the Demised Premises, with the same force and
effect as if originally so demised under this Lease as of the Additional Space
Commencement Date.
C. Lessee shall have the right to inspect the Additional Space prior to
exercising its rights herein. Lessee agrees to accept the Additional Space in
its "AS IS" state and condition on the Additional Space Commencement Date
without any representation or warranty, express or implied, in fact or by law,
by Lessor, and without recourse to Lessor, as to title thereto, the nature,
condition or usability thereof or as to the use or occupancy which may be made
thereof.
D. As used herein the "Additional Space Commencement Date" shall be the
date which is the sooner of: (1) the date specified in Lessor's notice or (2)
the date which on which Lessee occupies all or a part of the Additional Space.
SECTION 33.02. Any notice of election to exercise the right to expand
the Demised Premises as hereinbefore provided must be in writing and sent to
Lessor as provided in Article 21. In addition, if prior to the exercise of the
right to expand the Demised Premises, Lessee herein named shall have assigned
this Lease, no notice by the then Lessee of election to exercise an option to
expand shall be valid unless joined in or consented to in writing by Lessee
herein named (which consent, in order for the exercise of such right to be
effective, shall be delivered to Lessor at or prior to the time of the exercise
of the right as to which consent of Lessee herein named had been given). Neither
the right granted to Lessee in this Article to expand the Demised Premises, nor
the exercise of such right by Lessee, shall prevent Lessor from exercising any
option or right granted or reserved to Lessor in this Lease to terminate this
Lease, and the effective exercise of any such right of termination by Lessor
shall terminate any such renewal or extension and any right of Lessee to any
such renewal or extension, whether or not Lessee shall have exercised any such
right to expand the Demised Premises. Any such option or right on the part of
Lessor to terminate this Lease pursuant to the provisions hereof shall apply to
the Additional Space.
56
SECTION 33.03.A. All of the terms, covenants and conditions of this
Lease applicable to the Demised Premises as originally constituted shall be
applicable to the Demised Premises including the Additional Space, except that
the annual Fixed Rent provided for in Article 2 shall be increased by the
product of the Fair Market Rent as determined in Section 33.03.C hereof and the
gross square footage of the Additional Space, and Lessee agrees to pay such
amount from and after the Additional Space Commencement Date.
B. During and in respect of the Term hereof, Lessee's Proportionate
Share shall be increased by the gross square footage of all Additional Space
that Lessee occupies in the Building.
C. As used herein "Fair Market Rent" shall mean the annual rate equal
to the annual fair rental value of the Additional Space (without deduction for
the cash value of free rent and leasehold improvements), which non-equity
tenants are then receiving in connection with a lease for comparable space in
the Building on the Additional Space Commencement Date with a term equal to the
term of this Lease and otherwise containing the same provisions as this Lease
contains, as reasonably determined by Lessor.
SECTION 33.04. If Lessee shall effectively exercise its right to hire
the Additional Space, Lessor and Lessee, upon demand of either, shall execute
and deliver to each other duplicate originals of an instrument, duly
acknowledged, setting forth (i) that the Demised Premises have been expanded to
include the Additional Space, (ii) the amount of such Additional Space, (iii)
the annual Fixed Rent payable during the Term, (iv) that such Additional Space
is upon and subject to all of the terms, covenants, conditions and limitations
contained herein, and (v) Lessee's Proportionate Share as increased by the
Additional Space.
ARTICLE 34- DEFINITIONS
SECTION 34.01 For the purposes of this Lease and all agreements
supplemental to this Lease, unless the context otherwise requires:
(a) "Additional Rent" shall mean all sums of money, other than
Fixed Rent, as shall become due from and payable by Lessee hereunder.
57
(b) "Building" shall mean the building, structures and
improvements, and related facilities, including paved areas and all
parking lots adjacent and/or appurtenant thereto (other than "Building
Equipment", as such term is herein defined) known as RiverView at
Purchase and located at 287 Bowman Avenue, Purchase, New York 10577,
now or hereafter erected, constructed or situated on the land
underlying or appurtenant to the Building or any part thereof, together
with all alterations, additions and improvements thereto and all
restorations and replacements thereof.
(c) "Building Equipment" shall mean all machinery, systems,
apparatus, facilities, equipment and fixtures of every kind whatsoever
now or hereafter belonging, attached to and used exclusively (whether
or not same constitute fixtures), or procured for exclusive use, in
connection with the operation or maintenance of the Building and/or
Property, including water, sewer and gas connections, all heating,
electrical, lighting, and power equipment, engines, furnaces, boilers,
pumps, tanks, dynamos, motors, generators, conduits, plumbing,
cleaning, fire prevention, refrigeration, ventilating, air cooling, air
conditioning equipment and apparatus, cranes, elevators, escalators,
ducts and compressors and any and all replacements thereof and
additions thereto; but excluding, however, (i) Lessee's Property, (ii)
property of any sublessee which sublessee may be authorized to remove
from the Building upon and subject to the terms and conditions of its
sublease and this Lease, (iii) property of contractors servicing the
Building, and (v) improvements for water, gas, and electricity and
other similar equipment or improvements owned by any public utility
company or any governmental agency or body.
(d) "Cost" shall mean that Lessor will perform all such
services on a "cost plus" basis, whereby Cost shall include, but not be
limited to, the cost of sub-contractors, material, equipment rental,
transportation and delivery items, permits, fees, taxes, insurance's,
debris removal, demolition, safety protection, labor, supervision,
construction management, purchasing, expediting and material handling,
and shall also include a contingency, based on the complexity of the
work to be performed, of up to five percent (5%) of the total of all
such items otherwise included within such definition (the "Trades"). In
addition, with respect to Lessor's Work as provided for in Article 8 of
this Lease or Alterations as provided for in Article 25 of this Lease,
Cost shall also include Lessor's fee for acting as project manager.
58
(e) "Environmental Laws" shall mean any and all Federal,
state, local, or municipal laws, rules, orders, regulations, statutes,
ordinances, codes, decrees or requirements of any Governmental
Authority regulating, relating to or imposing liability or standards of
conduct concerning environmental conditions at the Demised Premises,
Building or Property as now or may at any time hereafter be in effect,
including but not limited to and without limiting the generality of the
foregoing, The Clean Water Act also known as the Federal Water
Pollution Control Act, 88 U.S.C. Section 1251 ET SEQ., the Toxic
Substance Control Act, 15 U.S.C. Section 2601 ET SEQ., the Clean Air
Act, 42 U.S.C. Section 7401 ET SEQ., the Federal Insecticide, Fungicide
and Rodenticide Act, 7 U.S.C. Section 186 ET SEQ., the Safe Drinking
Water Act, 42 U.S.C. Section 300f ET SEQ., the Surface Mining Control
and Reclamation Act, Section 1201 ET SEQ., 80 U.S.C. Section 1201 ET
SEQ., the Comprehensive Environmental Response, Compensation and
Liability Act ("CERCLA"), 42 U.S.C. Section 9601 ET SEQ., the Superfund
Amendment and Reauthorization Act of 1986 ("SARA"), Public Law 99-499,
100 Stat. Section 1818, the Emergency Planning and Community Right to
Know Act, 42 U.S.C. Section 1101 ET SEQ., the Resource Conservation and
Recovery Act ("RCRA"), 42 U.S.C. Section 6901 ET SEQ., and the
Occupational Safety and Health Act as amended ("OSHA"), 29 U.S.C.
Section 655 and Section 657, together with any amendments thereto,
regulations promulgated thereunder and all substitutions thereof.
(f) "Hazardous Material" shall mean (i) Any hazardous, toxic
or dangerous waste, substance or material defined as such in (or for
the purpose of) CERCLA, SARA, RCRA, or any other Environmental Law as
now or at any time hereafter in effect; (ii) any other waste, substance
or material that exhibits any of the characteristics enumerated in 40
C.F.R. Sections 261.20 through 261.24, inclusive, and those extremely
hazardous substances listed under Section 902 of SARA that are present
in threshold planning or reportable quantities as defined under SARA
and toxic or hazardous chemical substances that are present in
quantities that exceed exposure standards as those terms are defined
under Section 6 and 8 of OSHA and 29 C.F.R. Part 1910; (iii) any
asbestos or asbestos containing substances whether or not the same are
defined as hazardous, toxic, dangerous waste, a dangerous substance or
dangerous material in any Environmental Law; (iv) "Red Label" flammable
materials; (v) all Laboratory Waste and by-products; and (vi) all
biohazardous materials.
59
(g) "Insurance Requirements" shall mean the rules,
regulations, orders and other requirements of any insurance rating or
regulatory organization having jurisdiction of, and which are
applicable to, the Demised Premises and of any liability, casualty, or
other insurance policy which either Lessor or Lessee is required
hereunder to maintain or may maintain hereunder.
(h) "Legal Requirements" shall mean the requirements of every
statute, law, ordinance, regulation, rule requirement, order or
directive, now or hereafter made by any Federal, state or local
government or any department, political subdivision, bureau, agency,
office or officer thereof, or any other governmental authority having
jurisdiction (a "Governmental Authority") with respect to and
applicable to (i) the Demised Premises and appurtenances thereto,
and/or (ii) the condition, equipment, maintenance, use or occupation of
the Demised Premises, including the making of an alteration or addition
in or to any structure upon, connected with or appurtenant to the
Demised Premises.
(i) "Lessee's Delays" shall mean any and all delays caused by
or attributable to any action or failure or refusal of Lessee to
perform a duty of, Lessee or any person claiming through or under
Lessee, or any agent, servant, employee, director, shareholder,
contractor or invitee of Lessee or any such person.
(j) "Lessee's Property" shall mean all articles of personal
property and fixtures and other property, which have been installed or
affixed on, in or to, or brought into, the Demised Premises, at the
expense of Lessee or any permitted sublessee of Lessee or other
permitted occupant of the Demised Premises and without any credit or
allowance by Lessor, which are not replacements or any property of
Lessor (whether any such replacement is made at Lessee's expense or
otherwise), and which do not constitute alterations, changes,
additions, or improvements to the Demised Premises or any appurtenances
thereto.
(k) "Lessee's Proportionate Share" shall mean a fraction the
numerator of which is equal to the rental square footage that Lessee
occupies in the Demised Premises, and the denominator of which is equal
to the total rental square footage of the Building as it presently
exists or may hereinafter be increased or enlarged. As of the
Commencement Date, the total rentable square footage of the Building
shall be deemed to consist of One Hundred and Twenty Thousand
(120,000), the total rentable square footage of the Demised Premises
shall be deemed to consist of One Thousand, Six Hundred and Fifty
60
(1,650) square feet, and Lessee's Proportionate Share shall be deemed
to be One and Thirty-Eight Hundredths (1.38%) percent. Lessee and
Lessor agree that Lessee's Proportionate Share is not based upon any
particular method of measuring the Demised Premises and/or the Building
and represents an agreed upon percentage and shall not be contestable
by Lessee at a future date.
(l) "Lessor's Agents" shall be deemed to include agents,
servants, employees, directors, officers, shareholders and contractors
of Lessor.
(m) "Normal Working Hours" shall mean only those between the
hours of 8:00 A.M. and 6:00 P.M., Monday through Friday, exclusive of
New Years Day, the day designated as the legal holiday for the
celebration of Washington's Birthday, Memorial Day, Fourth of July,
Labor Day, Thanksgiving Day and Christmas Day and all union holidays.
(n) "Unavoidable Delays" shall mean any and all delays beyond
Lessor's reasonable control, including Lessee's Delays, governmental
restrictions, governmental preemption, strikes, labor disputes,
lockouts, shortages of labor and materials, enemy action, civil
commotions, riot, insurrection and fire, other casualty and other acts
of God.
(o) "Untenantable" shall mean actual inability to use space in
the Demised Premises for the purposes permitted by Section 4.01.
SECTION 34.02. For the purposes of this Lease and all agreements
supplemental to this Lease, unless the context otherwise requires:
(a) The terms "include", "including", and "such as" shall be
construed as if followed by the phrase "without being limited to".
(b) Whenever this Lease provides that Lessee shall pay Lessor
interest at the "maximum legal rate" then interest shall be payable at
the highest rate of interest permitted at the relevant time by
applicable law to be paid by Lessee without impairing the validity or
enforceability of this Lease and without incurring any civil or
criminal penalty.
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(c) The term "obligations of this Lease" and words of similar
import, shall mean the covenants to pay Fixed Rent and Additional Rent
and all of the other covenants and conditions contained in this Lease.
Any provision in this Lease that one party or the other or both shall
do or not do or shall cause or permit or not cause or permit a
particular act, condition or circumstance shall be deemed to mean that
such party so covenants or both parties so covenant, as the case may
be.
(d) The term "repair" shall be deemed to include restoration
and replacement as may be necessary to achieve and/or maintain good
working order and condition.
(e) Reference to "substantially complete" and words of similar
import shall be deemed to mean, with regard to construction work,
completion but for such minor details of work, the non-completion of
which would not materially interfere with the utility of the affected
space and a certificate of occupancy has been issued by the
Governmental Authority having jurisdiction over the Demised Premises.
(f) Reference to "termination of this Lease" includes
expiration or earlier termination of the Term or cancellation of this
Lease pursuant to any of the provisions of this Lease or to law. Upon
the termination of this Lease, the Term and estate hereby granted by
this Lease shall end at noon on the date of termination as if such date
were the date of expiration of the Term and neither party shall have
any further liability or obligation to the other after such termination
(i) except as shall be expressly provided for in this Lease, and (ii)
except for such obligations as by their nature or under the
circumstances can only be, or by the provisions of this Lease, may be,
performed after such termination, and, in any event, unless expressly
otherwise provided in this Lease, any liability for a payment which
shall have accrued to or with respect to any period ending at the time
of termination shall survive the termination of this Lease.
ARTICLE 35- MISCELLANEOUS
SECTION 35.01. This Lease shall be governed in all respects by the laws
of the State of New York applicable to leases made and to be performed wholly
therein.
SECTION 35.02. All pronouns and any variations thereof shall be deemed
to refer to the masculine, feminine, neuter, single or plural, as the identity
of the person or persons or entity or entities in question may require. The term
"person" shall be deemed to include individuals, corporations, partnerships,
joint ventures, firms, associations and other entities.
SECTION 35.03. All provisions of this Lease shall be deemed and
construed to be "conditions" as well as "covenants", as though the words
specifically expressing or importing covenants and conditions were used in each
separate provision hereof.
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SECTION 35.04. If any provision of this Lease or application thereof to
any person or circumstance shall, to any extent, be invalid or unenforceable,
the remainder of this Lease, or the application of such provision or provisions
to persons or circumstances other than those as to whom or which it is held
invalid or unenforceable, shall not be affected thereby, and every provision of
this Lease shall be valid and enforceable to the fullest extent permitted by
law.
SECTION 35.05. The article headings in this Lease are inserted only as
a matter of convenience and reference and are not to be given any effect
whatsoever in construing this Lease.
SECTION 35.06. This Lease contains the entire agreement between the
parties regarding the Demised Premises and shall not be modified in any manner
except by an instrument in writing executed by the parties or their respective
successors in interest. No waiver or modification by either party or any
provision or covenant of this Lease shall be deemed to have been made unless
such waiver is expressed in writing and signed by the party against whom such
waiver or modification is sought.
SECTION 35.07. Lessee agrees with Lessor that Lessee will not record
this Lease or any memorandum of this Lease without the prior written consent of
Lessor.
SECTION 35.08. The covenants, agreements, terms, provisions and
conditions contained in this Lease shall apply to and inure to the benefit of
and be binding upon Lessor and Lessee and their respective successors and
assigns, except as otherwise provided for herein.
SECTION 35.09. Upon request of Lessor, but not more often than once
each fiscal or calendar year, as the case may be, Lessee and any such person
shall submit to Lessor true, correct, current and complete financial statements
of Lessee and its affiliates, if any.
SECTION 35.10. Solely for the purposes of a proceeding under the
present or future federal bankruptcy act or any other present or future
applicable federal, state or other statute or law (a "bankruptcy law"), the
following terms and conditions have been agreed upon by Lessor and Lessee:
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(a) In the event of a default by Lessee under this Lease
continuing after the filing of a voluntary or involuntary petition (a
"pre-petition default") under any bankruptcy law, a period exceeding
thirty (30) days for curing such default shall in no event be deemed
reasonable.
(b) In order to be deemed adequate assurance by Lessee for the
cure of any pre-petition default, Lessee, or the trustee, as the case
may be, must (i) deposit with a banking institution selected by Lessor
securities, in negotiable form, issued by the United States of America,
with a fair market value, at all relevant times, equal to twice the
amount of rent due or the cost, as estimated by Lessor of curing the
pre-petition default, as the case may be, or (ii) grant to Lessor a
security interest or lien, which shall be superior to any and all
claims and liens, on any of Lessee's property that is valued at
liquidation at twice the amount of such rent or cost.
(c) In order to be deemed adequate assurance by Lessee, with
respect to the payment of rent due after the filing of a voluntary or
involuntary petition under any bankruptcy law, Lessee must (i) deposit
with a banking institution selected by Lessor securities in negotiable
form, issued by the United States of America, with a fair market value,
at all relevant times, of not less than four (4) months' rent, or (ii)
grant a security interest or lien, which shall be superior to any and
all claims and liens, in any of Lessee's property that is valued at
liquidation at not less than six (6) months' rent.
SECTION 35.11. Lessee represents and warrants: (i) that it is a
corporation duly organized in its state of incorporation and authorized to do
business in the State of New York; (ii) that it has all requisite authority to
execute and to enter into this Lease and that the execution of this Lease will
not constitute a violation of any internal by-law, agreement or other rule of
governance, and (iii) that the individual executing this Lease on behalf of
Lessee is so authorized and Lessee shall supply Lessor with a verified
resolution or similar written documentation evidencing such authority upon or
prior to Lessee's execution of this Lease.
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IN WITNESS WHEREOF, the parties to this Lease have executed the same on
the day and in the year first above written.
PHOENIX CAPITAL PARTNERS, LLC, (Lessor)
By: FMB Asset Management I, LLC, a Member
By: /s/ Frank M. Boccanfuso
--------------------------------------
Name: Frank M. Boccanfuso
Title: Managing Member
MVC CAPITAL, (Lessee)
By: /s/ Jaclyn Shapiro
--------------------------------------
Name: Jaclyn Shapiro
Title: Assistant Secretary
STATE OF NEW YORK )
)SS.:
COUNTY OF WESTCHESTER )
On this 6th day of January, 2004, before me, the undersigned,
personally appeared FRANK BOCCANFUSO, personally known to me or proved to me on
the basis of satisfactory evidence to be the individual(s) whose name(s) is
(are) subscribed to the within instrument and acknowledged to me that
he/she/they executed the same in his/her/their capacity(ies), and that by
his/her/their signature(s) on the instrument, the individual(s), or the person
on behalf of which the individual(s) acted, executed the instrument.
/s/ Ralph D. Amicucci
Notary Public
STATE OF NEW YORK )
)SS.:
COUNTY OF NEW YORK )
On this 30th day of December, 2003, before me, the undersigned,
personally appeared Jaclyn Shapiro, personally known to me or proved to me on
the basis of satisfactory evidence to be the individual(s) whose name(s)is(are)
subscribed to the within instrument and acknowledged to me that he/she/they
executed the same in his/her/their capacity(ies), and that by his/her/their
signature(s) on the instrument, the individual(s), or the person on behalf of
which the individual(s) acted, executed the instrument.
/s/ Henry B. Trattner
Notary Public