EXHIBIT 10.8
LEASE
THIS LEASE, made as of the 30th day of March, 1992, by and between
HAROLD LEPLER, an individual having an office in care of Covington Management
Company (Attn: Harold Lepler) at Millbrooke Office Centre, Route 22 and
Milltown Road, Brewster, New York 10509. (hereinafter referred to as
"Landlord"), and SCHEIN PHARMACEUTICAL, INC., a corporation organized and
existing under the laws of the State of New York, having an office at 26 Harbor
Park Drive, Port Washington, New York 11050 (hereinafter referred to as
"Tenant").
W I T N E S S E T H
ARTICLE 1
DEMISED PREMISES
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1.1 Landlord hereby leases to Tenant, and Tenant hereby takes from
Landlord, upon and subject to the terms, covenants and conditions hereinafter
set forth, that certain parcel of land (hereinafter referred to as the "Land")
described on Exhibit A attached hereto and outlined on the plot plan attached
hereto as Exhibit B, located in Mt. Ebo Corporate Park (hereinafter referred to
as the "Park") in the Town of Southeast, County of Putnam and State of New York,
together with the building (hereinafter referred to as the "Building") on the
Land, together with all other improvements, and all other easements,
improvements, tenements, appurtenances, hereditaments and rights and privileges
appurtenant thereto, and any and all machinery and equipment installed in said
Building (all such items together with the Land and Building are hereinafter
collectively referred to as the "Demised Premises").
SUBJECT, only, however, to the title and site plan conditions
described on Exhibit C attached hereto (the foregoing being hereinafter referred
to as the "Permitted Encumbrances"), provided the same do not prevent the use of
the Demised Premises for the purposes initially specified in Article 4 hereof.
TO HAVE AND TO HOLD the Demised Premises for the term and at the rents
and upon the covenants, conditions and agreements hereinafter provided.
Tenant hereby expressly covenants to keep, perform and observe all of
the covenants, conditions and agreements contained herein on its part to be
kept, performed and observed.
Landlord hereby expressly covenants to keep, perform and observe all
of the covenants, conditions and agreements contained herein on its part to be
kept, performed and observed.
ARTICLE 2
TERM
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2.1 The term (hereinafter referred to as the "Term") of this Lease
shall commence on the Commencement Date (as hereinafter defined) and shall be
for fifteen (15) years, plus the fractional month, if any, between the fifteenth
(15th) anniversary of the Commencement Date, if it falls on a day other than the
first day of a month, and the last day of the month in which the fifteenth
(15th) anniversary of the Commencement Date occurs; otherwise, if the
Commencement Date is the first day of the month, then the Term shall end on the
last day of the month immediately preceding the month in which the fifteenth
(15th) anniversary of the Commencement Date falls; unless the Term of this Lease
is sooner terminated or extended, as hereinafter provided. Tenant shall have
options to renew the Term in accordance with Article 33 hereof.
2.2 Landlord and Tenant have, contemporaneously herewith, entered
into a certain Agreement of even date herewith with respect to the construction
of the Demised Premises (the "Development Agreement").
2.3 Landlord hereby covenants and agrees, at Landlord's sole cost and
expense, to perform the work and all other obligations on the part of the
Developer to be performed under the Development Agreement in accordance with the
terms and conditions thereof ("Landlord's Work"). Landlord agrees to perform
Landlord's Work in a manner which shall cause the least possible interference to
Tenant in the performance of Tenant's Work (as defined in the Development
Agreement) and Tenant's use and enjoyment of the Demised Premises. Landlord
shall continuously keep Tenant fully informed of the progress of Landlord's
Work; and Tenant's representatives at all times shall have access to the Demised
Premises during Landlord's Work for purposes of inspection. In addition,
Landlord shall cooperate with Tenant so that Tenant is able to commence
preparing the Demised Premises for Tenant's use and occupancy.
Tenant is hereby permitted to enter the Demised Premises for the
purpose of doing Tenant's Work and making the same ready for Tenant's occupancy.
Provided that all "Conditions" on the part of Developer to be satisfied pursuant
to and as defined in the Development Agreement have been satisfied in full,
Tenant agrees promptly to commence Tenant's Work and to use due diligence and
continuity to complete Tenant's Work, subject to unavoidable delays caused by
events beyond the control of Tenant. Tenant and Landlord agree that:
(a) Tenant will employ contractors approved by Landlord, which
approval Landlord agrees not to unreasonably withhold;
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(b) Except to the extent that any of Tenant's Work shall constitute a
portion of the Demised Premises with respect to which Landlord shall have an
obligation to maintain or repair in accordance with another provision of this
Lease, Landlord shall not be responsible for any materials installed or
delivered, or any work performed, in connection with Tenant's Work;
(c) Landlord and Tenant will cooperate with each other to coordinate
the schedule of the performance of Tenant's Work and Landlord's Work so that the
installation or delivery of such materials or work performed shall not interfere
with the other's work or the other's workmen;
(d) Any materials so installed or work performed by Tenant shall be
made in conformity with all Laws and Ordinances (as hereinafter defined), shall
not violate any permit issued to Landlord (which Landlord has identified to
Tenant and Tenant's architect) and shall be made after Tenant obtains any
permits required for such materials and work;
(e) Tenant and Landlord shall cooperate with each other to coordinate
the employment of labor for the performance of any work required to be done by
Tenant or Landlord, which is compatible with the labor employed by the other so
as to avoid any labor dispute or work stoppage and agrees to cease work promptly
upon notice from the other if any is threatened; and
(f) Tenant shall, during such period, perform and comply with all the
terms, covenants and conditions of this Lease to be performed by Tenant other
than the payment of any charges for rent or additional rent required to be paid
by Tenant hereunder.
2.4 For the purposes of this Lease, the Commencement Date shall mean
the date on which the last of all the following shall have occurred or have been
performed:
(i) Landlord shall have Substantially Completed Landlord's
Work and Tenant shall have been provided with at least ninety (90) days from the
date on which Landlord has Substantially Completed Landlord's Work to perform
Tenant's Work. As used in this Lease, "Substantially Completed" or "Substantial
Completion" shall mean completed or completion except for details of
construction, decoration and mechanical, electrical or other adjustments, which
do not materially interfere with Tenant's use of the Demised Premises;
(ii) All utilities have been connected in the Building and are
in good working order;
(iii) A temporary or permanent certificate of occupancy shall
have been obtained by Landlord from the
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appropriate local authority indicating that the Demised Premises may be lawfully
occupied for the purposes set forth herein;
(iv) Landlord shall have delivered to Tenant the "Commencement
Date Certificate and Agreement" in the form annexed hereto as Exhibit D;
(v) Landlord shall have obtained from any mortgagee of the
Demised Premises, a Non-Disturbance Agreement, as such term is defined herein;
and
(vi) All other Conditions under and as defined in the
Development Agreement on the part of the Developer thereunder to be satisfied
have been satisfied in full.
In the event that the Commencement Date occurs prior to Landlord's
having obtained a permanent certificate of occupancy, Landlord shall be
obligated to perform all work and supply all material necessary to obtain a
permanent certificate of occupancy prior to the expiration of the temporary
certificate of occupancy.
2.5 Within one hundred twenty (120) days after the Substantial
Completion of the Demised Premises, Tenant shall deliver to Landlord a statement
or statements setting forth the items of work to be performed by Landlord
hereunder, if any, which have not been completed or which are defective.
Landlord agrees to complete such items with reasonable diligence. Landlord shall
not be relieved of its responsibility with respect to Landlord's Work as a
result of Tenant's failure to identify defects in Landlord's Work, unless Tenant
has not notified Landlord of such defects within twelve (12) months from the
Commencement Date of this Lease. Defects which are not reasonably apparent from
Tenant's contemplated use of the Demised Premises shall not be subject to such
twelve (12) month limitation. Landlord agrees to assign to Tenant any warranty
and/or guaranty of work and/or materials from any contractor and/or materialmen
at the end of such twelve (12) month period and shall cooperate with Tenant in
enforcing all such warranties and/or guaranties. Landlord shall not be
obligated to repair or restore any damage to Demised Premises caused by Tenant,
or Tenant's employees or contractors.
2.6 Within thirty (30) days after the request of either party hereto
after the Commencement Date of this Lease shall have been determined, Landlord
and Tenant shall execute, acknowledge and deliver to each other duplicate
originals of an instrument in form and content reasonably satisfactory to them
setting forth such date. The failure of either party to promptly execute and
deliver such instrument shall in no way affect the commencement of the term
hereof.
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At the request of either party, Landlord and Tenant shall promptly
execute, acknowledge and deliver a memorandum with respect to this Lease
sufficient for recording, which Tenant may record at Tenant's cost and expense.
Such memorandum shall not in any circumstance be deemed to change or otherwise
affect any of the obligations or provisions of this Lease.
2.7 Anything set forth in this Lease to the contrary notwithstanding,
this Lease shall not be effective, nor shall Tenant have any obligations to
perform hereunder, unless and until all Conditions under and as defined in the
Development Agreement on the part of the Developer thereunder to be satisfied
have been satisfied in full. In the event that Tenant elects to terminate the
Development Agreement in accordance with the terms thereof, this Lease will
automatically terminate without the necessity of any additional action on the
part of either Landlord or Tenant hereunder.
ARTICLE 3
RENTAL
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3.1 Tenant agrees to pay to Landlord a fixed minimum rent
(hereinafter referred to as the "Fixed Minimum Rent") at the rates set forth on
Exhibit E attached hereto. Monthly installments of Fixed Minimum Rent, shall be
paid in advance on the first day of each and every calendar month, and, together
with all other amounts payable by Tenant to Landlord hereunder, shall be paid at
the offices of Landlord set forth above, or at such other place or to such other
entity or entities as Landlord may from time to time designate by notice to
Tenant, without notice or demand therefor and without deduction, abatement or
set-off except as herein permitted.
3.2 All costs, charges and expenses which Tenant is obligated to pay
to Landlord pursuant to the provisions of this Lease shall be deemed additional
rent ("Additional Rent"), and in the event of nonpayment thereof, after Tenant's
receipt of notice of nonpayment and the expiration of ten (10) days without
payment (provided that, if Tenant disputes in good faith its obligation to make
all or any portion of such payment, such ten (10) day period shall be extended
with respect to the disputed portion of such payment during the period of such
dispute), Landlord shall have all the rights and remedies with respect thereto
as is provided for herein or by applicable law in case of non-payment of rent
(Fixed Minimum Rent and Additional Rent are sometimes hereinafter collectively
referred to as "Rental"). If the Commencement Date shall be a date other than
the first day of a calendar month, the Fixed Minimum Rent and other charges
shall be prorated for the portion of the calendar month in which the
Commencement Date occurs, and shall be paid by Tenant promptly after being
billed therefor.
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Tenant covenants to pay the Fixed Minimum Rent and Additional Rent as
in this Lease provided, when due, and in lawful money of the United States which
shall be legal tender for payment of all debts and dues, public and private, at
the time of payment. From and after the expiration of the applicable notice and
grace period provided in this Lease, all unpaid sums due and payable as Fixed
Minimum Rent and Additional Rent shall bear interest at the rate of two (2%)
percent per annum over the prime rate of interest announced, from time to time,
by The Chase Manhattan Bank, N.A., New York, New York, or any successor thereto,
to corporate borrowers of the highest credit standing for 90-day unsecured
commercial loans, but in no event more than the maximum permitted by law
(hereinafter referred to as the "Default Charge"), and such interest shall be
deemed to be Additional Rent; provided, however, that no further interest shall
be payable upon such interest.
3.3 If at any time or times during the Term, the Fixed Minimum Rent,
Additional Rent or other charges payable by Tenant hereunder shall not be fully
collectible by reason of any Laws and Ordinances (including, without limitation,
rent control or stabilization laws), then for the period prescribed by such Laws
and Ordinances, Tenant shall pay to Landlord the maximum amounts permitted
pursuant thereto. Upon the expiration of the applicable period of time during
which such amounts shall be uncollectible, Tenant shall pay to Landlord as
Additional Rent, within fifteen (15) days after demand, all such uncollected
amounts that would have been payable for the period absent such legal
restrictions; provided, however, that the retroactive collection thereof shall
then be lawful.
Tenant shall remain obligated under this Lease in accordance with its
terms and shall not take any action to terminate, rescind or avoid this Lease,
notwithstanding any bankruptcy, insolvency, reorganization, liquidation,
dissolution or other proceeding affecting Landlord or any assignee of Landlord
or any action with respect to this Lease which may be taken by any trustee,
receiver or liquidator or by any court.
ARTICLE 4
USE
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4.1 Tenant initially shall use: (i) the Building for administrative,
executive and general business offices, warehousing of finished goods, raw
materials and packaging components, and distribution, in the conduct of its
pharmaceutical business (the "Initial Building Use") and (ii) the Land, other
than that occupied by the Building, for parking and landscaping as shown on the
final approved site plan; and thereafter the Demised Premises may be used for
any lawful purposes, which are not prohibited by the Permitted Encumbrances and
the other provisions of this Lease (a "Subsequent Building Use").
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4.2 Tenant shall not suffer or permit the Demised Premises or any
part thereof to be used in any manner, or anything to be brought into or kept
therein, which would in any way: (i) cause structural injury to the Building or
any part thereof; (ii) constitute a public or private nuisance; (iii) impair the
appearance, character or reputation of the Building and/or the Park; or (iv)
violate any of Tenant's other obligations under this Lease.
4.3 For purposes hereof the term "Insurance Companies and Boards"
shall mean the companies writing the insurance policies required pursuant to the
provisions of this Lease and the New York Board of Fire Underwriters, or any
other body having similar jurisdiction and any body establishing insurance
premium rates.
ARTICLE 5
COMPLIANCE WITH LAWS
--------------------
5.1 A. Landlord agrees that Landlord's Work in constructing the
Demised Premises shall comply with all Laws and Ordinances on the Commencement
Date and shall permit Tenant's initial use of the Demised Premises.
B. Landlord shall, at its sole cost and expense, comply with all
present and future laws, orders, ordinances and regulations, including, without
limitation, all environmental, health and safety laws and regulations, of all
state, federal, municipal and local governments, departments, commissions and
orders of any public officer pursuant to law, all orders, rules and regulations
of the Board of Fire Underwriters or a similar body ("Laws and Ordinances") and
all requirements of Insurance Companies and Boards applicable to the Building or
the Demised Premises (other than matters for which Tenant is responsible under
the provisions of this Section). Tenant shall, at its sole cost and expense,
comply with all Laws and Ordinances and all requirements of applicable Insurance
Companies and Boards to the extent that such compliance is necessitated by
reason of Tenant's Specific Use (as hereinafter defined) of the Demised
Premises. Anything in this Lease to the contrary notwithstanding, it is hereby
understood and agreed that compliance with Laws and Ordinances: (i) which are of
general applicability to office buildings, warehouses and distribution
facilities, and (ii) which do not arise as a result of Tenant's Specific Use,
shall not be the responsibility of Tenant. For purposes hereof, "Tenant's
Specific Use" shall mean (i) the specific nature of the Initial Building Use of
the Demised Premises by Tenant, (ii) the specific nature of a Subsequent
Building Use of the Demised Premises by Tenant and (iii) the conversion of the
Building from its then existing use to a Subsequent Building Use.
C. If any structural repair or alteration to the Demised
Premises or the Building shall be required under this
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Article 5 and Tenant shall not be obligated to make the same pursuant to the
provisions hereof, such repair or alteration shall be made by Landlord, at
Landlord's sole cost and expense and in such manner so as to not unreasonably
interfere with Tenant's business or reduce the amount of useable space available
to Tenant.
D. In the event that Landlord pays the cost of any capital
expenditure required to be paid by Landlord by reason of any Laws and Ordinances
or the requirements of applicable Insurance Companies and Boards which become
effective after the Commencement Date, then Tenant shall pay to Landlord on the
first day of each calendar month during the period commencing with the calendar
month following completion of such capital expenditure and ending on the earlier
the expiration (inclusive of any Extended Terms elected by Tenant pursuant to
Article 33 below) or earlier termination of this Lease and the date upon which
such capital expenditure has been fully reimbursed by Tenant to Landlord, an
amount equal to the cost of such capital expenditure divided by the number of
months of the useful economic life of such capital expenditure.
5.2 Landlord agrees to remedy, at Landlord's sole cost and expense,
all environmental problems, other than those caused by Tenant, and shall
indemnify, defend and hold Tenant harmless against all loss, liability, damages,
costs and expenses, including reasonable attorneys' fees, relating to any
Hazardous Materials, as hereinafter defined, found in the Demised Premises
during the term of this Lease that are not caused by Tenant. Tenant shall be
responsible to remedy, at its sole cost and expense, all environmental problems
caused by Tenant during the Term, and shall indemnify, defend and hold Landlord
harmless against all losses, liability, damages, costs and expenses, including
reasonable attorneys' fees, relating to any Hazardous Materials found in the
Demised Premises during the term of this Lease that are caused by Tenant.
Without limiting the generality of the provisions of Section 5.lB, Tenant agrees
not to use, generate, manufacture, produce, store, release, discharge or dispose
of (or permit any of the same) or permit to exist on the Demised Premises or
transport (or permit to be transported) to or from the Demised Premises any
hazardous substances, hazardous materials, toxic substances or solid waste as
defined in the Clear Air Act, the Comprehensive Environmental Response
Compensation and Liability Act ("CERCLA"), the Resource Conservation and
Recovery Act ("RCRA") and the Hazardous Materials Transportation Act ("HMTA"),
any substances or materials listed as hazardous or toxic in the United States
Department of Transportation Table, by the Environmental Protection Agency or
any successor agency or under any federal, state or local laws or regulations
(collectively, "Hazardous Materials"), except in the ordinary course of its
business and in compliance with all Laws and Ordinances, including, without
limitation, the Clean Air Act, CERCLA, RCRA and HMTA. Tenant
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will immediately remove or cause to be removed from the Demised Premises any
Hazardous Materials not used, stored, generated, manufactured, produced,
released or discharged in the ordinary course of its business. Landlord
expressly acknowledges that Tenant shall from time to time, in the ordinary
course of its business, cause certain Hazardous Materials to be stored or
otherwise be present in the Demised Premises and agrees that such storage or
presence of Hazardous Materials shall be permitted by the terms of this Lease
provided Tenant complies with all applicable Laws and Ordinances relating
thereto.
In the event any Laws and Ordinances, as applied to Tenant's Specific
Use, shall require Tenant to follow special procedures for such emissions or
discharges, whether into the atmosphere, the ground, the water systems and/or
the sewage system, including but not limited to, the pretreatment of sewage
and/or the installation of a monitoring well(s), Tenant shall be responsible for
full compliance therewith and all of the costs and expenses thereof. Landlord
hereby covenants to cooperate with Tenant, to the extent necessary to enable
Tenant to comply with such procedures. Tenant agrees to deliver to Landlord any
and all certifications, affidavits and other documents which may be required
pursuant to Laws and Ordinances during the Term and after the expiration of the
Term, indicating compliance by Tenant with the provisions thereof. Without
limiting the generality of the foregoing, Tenant shall not intentionally
discharge into the sewer systems any Hazardous Materials stored in containers
situated in the Demised Premises.
5.3 If Tenant receives written notice of any violation of any Laws
and Ordinances applicable to the Demised Premises, or any recommendations by any
Insurance Companies and Boards, Tenant shall give prompt notice thereof to
Landlord.
5.4 Tenant, after notice to Landlord, may contest by appropriate
legal proceedings, without cost or expense to Landlord, the validity of any Law
or Ordinance, and may defer compliance therewith; provided, however, that (a)
such noncompliance shall not constitute a crime on the part of Landlord;
(b) Tenant shall diligently prosecute such contest to a final determination by a
court, department or governmental authority or body having final jurisdiction;
(c) Tenant shall indemnify Landlord against any and all liability, loss and
damage which Landlord may sustain by reason of Tenant's failure or delay in
complying therewith; and (d) Tenant shall keep Landlord advised as to the status
of such proceeding. Landlord agrees to cooperate reasonably with Tenant, and to
execute any documents or pleadings reasonably required for the purpose of any
such contest; provided, however, that the same shall be without cost or expense
to Landlord. Provided that Tenant chooses not to initiate a contest pursuant to
this paragraph, Landlord shall have the right, but not the obligation, to
contest by appropriate
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legal proceedings, at Landlord's expense, any such Law or Ordinance.
5.5 Tenant shall, at its own cost and expense, keep in full force and
effect any and all necessary permits, licenses, certificates or other
authorizations required in connection with Tenant's lawful and proper use,
occupancy, operation and management of the Demised Premises, and Tenant shall
obtain any and all necessary permits, licenses, certificates or other
authorization required in connection with Tenant's Specific Use of the Demised
Premises, provided however that nothing in this Section 5.5 shall increase,
enlarge or otherwise affect Tenant's obligations under Section 5.1 above.
5.6 Subject to the provisions of Articles 8, 12 and 17 of this Lease,
no abatement, diminution or reduction of the Fixed Minimum Rent, or of any
Additional Rent or other charges required to be paid by Tenant pursuant to the
terms of this Lease, shall be claimed by, or allowed to, Tenant for any
inconvenience, interruption, cessation or loss of business or otherwise caused
directly or indirectly by any present or future Laws and Ordinances, or by
priorities, rationing or curtailment of labor or materials, or because of civil
commotion, strikes or riots, or any matter or thing resulting therefrom, nor
shall this Lease be affected by any such causes, except for any act, omission or
gross negligence of Landlord; provided, however, that Tenant shall in no event
have any right of offset against the Rental under this Lease, except as provided
in Section 17.2 hereof. Tenant however, may bring a separate action against
Landlord, subject to the limitations set forth in Article 27 hereof, and
provided further that nothing herein contained is intended to affect the
coverage of Landlord as additional insured under the policies of liability
insurance to be maintained by Tenant.
ARTICLE 6
MAINTENANCE AND REPAIRS
AND COVENANT AGAINST WASTE
--------------------------
6.1 Except with respect to replacements, repairs and restorations
which are the obligation of Landlord pursuant to an express provision of this
Lease, including without limitation Section 6.2 and Articles 5, 8 and 12 hereof,
Tenant shall, throughout the Term and at no expense whatsoever to Landlord, take
good care of the Demised Premises and shall not do or suffer any waste with
respect thereto, and Tenant shall promptly make all repairs and replacements to
the Demised Premises necessary to keep the Demised Premises (including the
heating, plumbing, electrical, ventilating and air-conditioning systems) in good
and lawful order and condition, ordinary wear and tear excepted. Tenant shall
keep and maintain all exterior areas of the Demised Premises in a clean and
orderly condition, reasonably free of accumulation of ice, snow, dirt and
rubbish. Tenant agrees to use chemicals for de-icing which are not harmful to
the Demised
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Premises. Tenant agrees not to place a load upon any floor of the Building
which exceeds the load per square foot which such floor was designed to carry
and which is allowed by law.
6.2 Anything to the contrary set forth in this Lease notwithstanding,
during the Term of this Lease and any renewals thereof, Landlord shall, upon
reasonable notice from Tenant, make all necessary structural repairs to the
Building (but excluding the exterior and interior of all windows, doors, plate
glass and signs) and all repairs to the roads and drives located on, or
providing access to, the Demised Premises which roads and drives are owned by
Landlord. In addition, (i) during the first five (5) years and the last two (2)
years of the Term, Landlord agrees to make all replacements and repairs to the
heating, plumbing, electrical, ventilating and air conditioning systems (other
than such routine repairs as are necessary, in the course of Tenant's
maintenance of such systems, to keep such systems in good order and condition)
and (ii) during the first five (5) years of the Term, Landlord agrees to make
all replacements and repairs to the parking areas located on the Demised
Premises. Tenant shall be responsible for the restriping of the parking lots
throughout the Term.
Landlord shall not be required to do any of the work or supply any of
the materials required pursuant to this Section 6.2 in the event any damage is
caused by gross negligence of Tenant or Person Within Tenant's Control (as
hereinafter defined).
6.3 Tenant shall promptly reimburse Landlord for expenditures made by
Landlord pursuant to Section 6.2 above during the last two (2) years of the
Initial Term or any Extended Term if (i) Landlord's obligation to make such
expenditures arises only during the last two (2) years of the Term and (ii)
Tenant thereafter exercises its option to extend the Term.
ARTICLE 7
INSURANCE
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7.1 (a) Tenant, at Tenant's cost and expense, will maintain
insurance on the Demised Premises as follows:
(i) Insurance on an all-risk form insuring against the perils
of fire and extended coverage and physical loss or damage, including, without
duplication of coverage, theft, vandalism, malicious mischief, collapse, false
work, temporary buildings and debris removal, in amounts sufficient to prevent
Mortgagee, Landlord or Tenant from becoming a co-insurer of any loss, but in any
event in amounts not less than the actual replacement value of the Demised
Premises, exclusive of foundations, footings and excavations. The policies to be
provided pursuant to this Section 7.l(a)(i) shall be subject to such deductibles
as Tenant may elect, provided that, in the event of a loss covered by any such
policy, Tenant shall be obligated
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to provide from its own funds a sum equal to the amount of such deductible
(which sum to be provided by Tenant shall, for purposes of Article 8 hereof, be
deemed "insurance proceeds").
The actual replacement value of the Demised Premises shall be
determined from time to time, but not more often than once in every two (2)
years, at Landlord's request, by an appraiser designated by an insurer of the
Demised Premises and if the insurance company does not so designate an
appraiser, then by an appraiser designated by Landlord, at Landlord's cost and
expense, except that no such appraisal shall be required for the first two (2)
years of the Term. Appraisals which are requested by the insurer shall be
conducted at the expense of the insurer or Tenant. Notwithstanding the
foregoing provisions of this Section 7.1(a)(i), no appraisals of the Demised
Premises shall be required by Landlord as long as coverage of at least $30
million is provided with respect to the Demised Premises (by Tenant's blanket or
excess coverage policies, or otherwise).
(ii) Rent insurance with the standard extended coverage
endorsements issued in connection with fire insurance policies covering property
similar to the Demised Premises in an amount equal to the aggregate of the Fixed
Minimum Rent, Impositions (as hereinafter defined) and all other charges payable
by Tenant pursuant to this Lease for a period of one (1) year, except that
Tenant may at its election provide such insurance by an appropriate endorsement
to its business interruption policy.
(iii) General comprehensive public liability insurance with
respect to the Demised Premises and its appurtenances in the combined aggregate
amount of not less than Five Million ($5,000,000.00) Dollars with respect to
death and/or injuries suffered in any one accident, including property damage.
Such limits shall be increased from time to time (but not more often than once
every five (5) years) as may be reasonably required by Landlord based upon the
limits which are customary for similar buildings in the general vicinity of the
Building.
(iv) Workers' compensation insurance to the extent required by
the law of the State in which the Demised Premises are located and to the extent
necessary to protect Landlord and the Demised Premises against Workers'
compensation claims.
(v) Such other insurance reasonably requested by Landlord, in
such amounts and against such risks, as is commonly obtained in the case of
property similar in use to the Demised Premises and located in the vicinity of
the Demised Premises are located, with due regard to the height and the type of
the Building, its construction, use and occupancy.
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The insurance described in this Section 7.1(a) shall be written by
companies of nationally recognized good financial standing legally qualified to
issue such insurance and shall name Tenant as insured party and Mortgagee and
Landlord as additional insureds, as their interests may appear.
(b) Every such policy (other than any comprehensive liability or
workers' compensation policy) shall bear a mortgagee endorsement in favor of
Mortgagee; and such policies shall provide that the loss, if any, shall be
adjusted and payable to Landlord to be held and applied by Landlord or Mortgagee
for reconstruction of the Demised Premises. Every policy referred to in this
section (other than the workers' compensation policy) shall not be canceled or
materially altered except after 30 days' written notice to Landlord and the
Mortgagee and the policies referred to in Section 7.1(a)(i) and (ii) shall not
be invalidated by any act or neglect of Landlord or Tenant, nor by occupancy of
the Demised Premises for purposes more hazardous than permitted by such policy,
nor by any foreclosure or other proceedings relating to the Demised Premises,
nor by change in title to the Demised Premises. Tenant will immediately deliver
to the Landlord copies of any notices of cancellation received with regard to
any insurance maintained pursuant to this Article.
(c) Tenant shall deliver to Landlord and Mortgagee original
certificates which set forth the major policy provisions and limits of liability
relating to the Demised Premises (together with such other reasonable
information as may be requested by Landlord or Mortgagee to correctly evidence
the insurance coverage of Tenant covering the Demised Premises) of insurers,
reasonably satisfactory to Mortgagee, evidencing the existence of all insurance
which is required to be maintained by Tenant hereunder, such delivery to be made
(i) promptly after the execution and delivery hereof, and (ii) within ten (10)
days prior to the expiration of any such insurance. Tenant shall have the right
to pay such premiums in installments. Tenant shall not obtain or carry separate
insurance concurrent in form or contributing in the event of loss with that
required by this Article. Any insurance required hereunder may be provided
under blanket policies or excess coverage (umbrella) policies, provided that the
policies otherwise comply with the provisions of this Lease and allocate to the
Demised Premises the specific coverage, without possibility of reduction or
coinsurance by reason of, or damage to, any other property named therein.
7.2 Each insurance policy insuring the Demised Premises and Tenant's
fixtures and contents against loss, shall be written in a manner so as to
provide that the insurance company waives all right of recovery by way of
subrogation against Landlord and Mortgagee in connection with any loss or damage
covered by any such policies, provided that such waiver is available at no
additional cost to Tenant. If an additional charge is imposed to obtain such
waiver, Landlord may elect to
13
pay such charge. Landlord and Mortgagee shall not be liable to Tenant, to the
extent of the insurance proceeds actually collected and retained by Tenant, for
any loss or damage caused by fire or any of the risks enumerated in such
policies provided such waiver was in effect with respect to such policies at the
time of such loss or damage. If the release of either Landlord or Mortgagee
shall contravene the provisions of any insurance policy or any law with respect
to exculpatory agreements, the liability of the party in question shall be
deemed not released but no action or rights shall be sought or enforced against
such party unless and until all rights and remedies against such party's insurer
are exhausted and such party shall be unable to collect such insurance proceeds.
ARTICLE 8
FIRE AND OTHER CASUALTY
-----------------------
8.1 (a) Subject to the provisions of Section 8.1(b), Section 8.2,
Section 8.3 and Section 8.4 hereof, if the Building or the Demised Premises
shall be damaged by any casualty, Tenant shall notify Landlord of the same and
if an election to terminate this Lease shall not have been made pursuant to this
Article 8, Landlord shall repair said damage and restore and rebuild the
Building and/or Demised Premises (excluding Tenant Work and the personal
property of Tenant). In such event, the Fixed Minimum Rent payable hereunder
shall be reduced, until such time as the repair and restoration work is
Substantially Completed, Tenant has had an opportunity to Substantially Complete
restoration of Tenant's Work, and Tenant is not prevented by the condition of
the Demised Premises from occupying the Demised Premises for the normal conduct
of its business, in proportion to the extent that the Demised Premises are
rendered unusable for the normal conduct of the business then conducted on the
Demised Premises, and Landlord shall be entitled to receive the proceeds of rent
insurance maintained pursuant to Section 7.1(a)(ii) hereof. Such repair and
restoration work shall be diligently commenced and prosecuted by Landlord until
full completion thereof. It is acknowledged that a casualty affecting a portion
of the Warehouse (as hereinafter defined) may, as a consequence of Tenant's
Specific Use thereof, render the entire Warehouse unusable for the normal
conduct of the business conducted therein by Tenant. The terms of the rent
insurance maintained pursuant to Section 7.1(a)(ii) hereby shall acknowledge
the foregoing.
(b) If the insurance proceeds available to Landlord (or Landlord's
mortgagee) are not adequate to pay for the full cost of such repair and
restoration work, then (i) Landlord shall not be obligated to pay such
deficiency if within thirty (30) days of the date of such casualty, Landlord
sends written notice to Tenant (the "Insurance Deficiency Notice") advising
Tenant of the amount of such deficiency and that Landlord elects not to pay such
deficiency, and (ii) in the event that Landlord delivers the Insurance
Deficiency Notice to Tenant within such thirty (30) day
14
period, Tenant shall have the right, at its option, to terminate this Lease by
sending written notice of such termination to Landlord within ninety (90) days
after Tenant's receipt of the Insurance Deficiency Notice, which termination
shall be effective as of any date designated by Tenant, which effective date
shall not be more than twelve (12) months from the date of such termination
notice, or if Tenant does not terminate this Lease as aforesaid, Tenant shall
pay such deficiency. Notwithstanding the preceding sentence, Tenant shall pay
any deficiency attributable to Tenant's failure to maintain in effect any
insurance required to be maintained by Tenant pursuant to this Lease, and, in
such event, Tenant shall not have the right to terminate this Lease (it being
understood that Tenant shall not be responsible for any deficiency that would
not have been paid pursuant to normal policy exclusions). Landlord shall apply
all insurance proceeds received with respect to any insurance required to be
maintained by Tenant hereunder (other than the insurance to be provided pursuant
to Section 7.1(a) (ii) above) for the purposes of fully repairing and replacing
the damage unless an election to terminate this Lease is made pursuant to this
Article 8.
8.2 If the Building and/or Demised Premises shall be damaged by
casualty, to the extent that the portion of the Demised Premises used by Tenant
as a warehouse and distribution facility (the "Warehouse") is rendered unusable
for the normal conduct of Tenant's business then conducted in the Warehouse, and
a reputable contractor selected by Landlord and reasonably approved by Tenant
estimates that the repair of the Warehouse (including Tenant's Work, but
excluding the personal property of Tenant) cannot be Substantially Completed
within seven (7) months after the date of such casualty, Tenant may terminate
this Lease by notice to Landlord given within sixty (60) days of the date of
such casualty. Upon such notice, this Lease shall terminate (and Tenant shall
not be responsible for paying any deficiency pursuant to Section 8.1(b));
provided, however, that the provisions of this Lease which are designated to
cover matters of termination and the period thereafter shall survive the
termination of this Lease. Landlord shall use reasonable efforts to cause such
contractor's estimate to be rendered and delivered to Tenant within thirty (30)
days after the casualty.
8.3 If the Building and/or the Demised Premises shall be damaged by
casualty, to the extent that the portion of the Demised Premises used by Tenant
for office purposes (the "Offices") is rendered unusable for the normal conduct
of Tenant's business then conducted in the Offices, and a reputable contractor
selected by Landlord and reasonably approved by Tenant estimates that the repair
of the Offices (including the leasehold improvements, but excluding the personal
property of Tenant) cannot be Substantially Completed within twelve (12) months
after the date of such casualty, Tenant may terminate this Lease by notice to
Landlord given within sixty (60) days of the date of such casualty. Upon such
notice this Lease shall terminate (and
15
Tenant shall not be responsible for paying any deficiency pursuant to Section
8.1(b)), provided, however, that the provisions of this Lease which are
designated to cover matters of termination and the period thereafter shall
survive the termination of this Lease. Landlord shall use reasonable efforts to
cause such contractor's estimate to be rendered and delivered to Tenant within
thirty (30) days after the casualty. Notwithstanding the foregoing, Tenant shall
not have a right to terminate this Lease pursuant to this Section 8.3 in the
event that Landlord is able to provide to Tenant, within thirty (30) days of the
casualty and upon terms reasonably acceptable to Tenant, substitute office
facilities in the immediate vicinity of the Building, which are reasonable
acceptable to Tenant, and which will be available to Tenant during the period
that the repair and restoration work to the offices is being completed.
8.4 If a casualty occurs during the last two (2) years of the Term
and if any portion of the Demised Premises shall be so damaged by such casualty
that the cost of repair or replacement would exceed twenty-five percent (25%) of
the replacement cost of the Building as estimated by a reputable contractor
selected by Landlord and reasonably approved by Tenant, Tenant may terminate
this Lease by notice to Landlord given within sixty (60) days of the date of
such casualty and upon such notice, this Lease shall terminate; provided,
however, that the provisions of this Lease which are designated to cover matters
of termination and the period thereafter shall survive the termination of this
Lease. If Tenant does not choose to terminate this Lease in accordance with
this paragraph within such sixty (60) day period, Landlord may, at its option,
terminate this Lease by notice to Tenant given within ten (10) days of the
expiration of such sixty (60) day period. Landlord shall use reasonable efforts
to cause such contractor's estimate to be rendered and delivered to Tenant
within thirty (30) days after the casualty.
8.5 No damages, compensation, or claim shall be payable by Landlord
for inconvenience, loss of business or annoyance arising from any repair or
restoration of any portion of the Demised Premises, the leasehold improvements,
or the Building. Landlord shall use reasonable efforts to have such repairs for
which it is responsible made promptly so as not to unnecessarily interfere with
Tenant's occupancy.
8.6 In the event of the termination of this Lease pursuant to the
provisions of Section 8.1(b), Section 8.2, Section 8.3 or Section 8.4, this
Lease, the Term and the estate hereby granted shall expire as of the date of
such termination in the same manner and with the same effect as if it were the
date set for the normal expiration of the Term, and Fixed Minimum Rent shall be
apportioned as of the date of termination.
16
8.7 (a) If any of the insurance monies paid to Landlord shall remain
after the completion of the repair and restoration, the excess shall be paid to
Tenant, or if Tenant and Landlord funded any deficiency in the insurance
proceeds in order to complete the repair and restoration work, any excess shall
be shared by Landlord and Tenant proportionately to the amount of the deficiency
contributed by each party.
(b) Tenant understands that Landlord will not carry insurance of any
kind on Tenant's furniture or furnishings or on any fixtures or equipment
removable by Tenant under the provisions of this Lease, including Tenant's Work,
and that Landlord shall not be obligated to repair any damage thereto or replace
the same.
8.8 Landlord and Tenant each agrees that it will cooperate with the
other, to such extent as such other party may reasonably require, in connection
with the prosecution or defense of any action or proceeding arising out of, or
for the collection of, any insurance monies that may be due in the event of any
loss or damage, and that they each will execute and deliver to the other party
such instruments as may be reasonably required to facilitate the recovery of any
insurance monies.
8.9 Tenant agrees to give prompt notice to Landlord with respect to
all fires and other casualties occurring in, on, at or about the Demised
Premises.
ARTICLE 9
UTILITIES
---------
9.1 After the Substantial Completion of Landlord's Work, Tenant
agrees that Landlord is not, nor shall it be, required to furnish to Tenant or
any other occupant of the Demised Premises any gas, water, sewer, electric, heat
or any other utility, facility, equipment, labor, materials, services or trash
removal of any kind whatsoever (collectively referred to in this Article as
"Utilities and Services").
9.2 Tenant agrees to obtain all Utilities and Services and to pay all
charges therefor. Provided that Landlord performs all of its obligations under
Article 6 in a timely manner, Tenant expressly agrees that Landlord shall not be
responsible for the failure of supply to Tenant of any of such Utilities and
Services, or any other utility or services, whether similar or dissimilar to
those enumerated in this Article.
9.3 Tenant agrees to limit its consumption of water at the Demised
Premises to not more than l0~000 gallons per day.
9.4 Notwithstanding the foregoing provisions of this Article 9, as
long as water and sewer service is provided to the Demised Premises by an
affiliate of Landlord, unless the water
17
and sewer rates are regulated by a state or municipal agency, Tenant's
obligation to pay for water and sewer service shall be limited to the amount
that is computed based upon the average rates approved by the state or municipal
agency then applicable to the provision of water to facilities comparable to the
Demised Premises in the vicinity thereof.
ARTICLE 10
MECHANIC'S LIENS
----------------
10.1 Tenant shall not suffer or permit any liens to be filed against
the Park, Demised Premises or any part thereof or against Tenant's leasehold
estate therein by reason of any work, labor, services or materials done for, or
supplied, or claimed to have been done for, or supplied to, Tenant or any one
holding the Demised Premises or any part thereof through or under Tenant. If
any such lien shall at any time be filed against the Park, the Demised Premises
or any part thereof or against Tenant's leasehold estate therein, Tenant shall
cause the same to be discharged of record within forty-five (45) days after the
date of notice thereof to Tenant, by either payment, deposit, bond or otherwise.
If Tenant shall fail to discharge any such lien within such period, then, in
addition to any other right or remedy of Landlord, Landlord may, but shall not
be obligated to, procure the discharge of the same either by paying the amount
claimed to be due by deposit in court or by bonding, and/or Landlord shall be
entitled, if Landlord so elects, to compel the prosecution of an action for the
foreclosure of such lien by the lienor and to pay the amount of the judgment, if
any, in favor of the lienor with interest, costs and allowances. Any amount
paid or deposited by Landlord for any of the aforesaid purposes, and all legal
and other expenses of Landlord, including reasonable attorneys' fees, in
defending any such action or in or about procuring the discharge of such lien,
with all necessary disbursements in connection therewith, together with the
Default Charge thereon, shall become due and payable forthwith by Tenant to
Landlord.
10.2 Nothing in this Lease shall be deemed to be, or construed in any
way as constituting, the consent or request of Landlord, expressed or implied,
by inference or otherwise, to any person, firm or corporation for the
performance of any labor or the furnishing of any materials for any
construction, rebuilding, alteration or repair of or to the Demised Premises or
any part thereof, nor as giving Tenant any right, power or authority to contract
for or permit the rendering of any services or the furnishing of any materials
which might in any way give rise to the right to file any lien against
Landlord's interest in the Demised Premises.
18
ARTICLE 11
ALTERATIONS
-----------
11.1 For the purposes of this Article the term "Alterations" shall
include, without limitation, decorations, installations, changes, restorations,
replacements, additions, improvements and betterments. An alteration shall be
deemed to be structural if it involves or affects (a) the exterior (or the
exterior appearance) of the Building other than landscaping or the restriping of
the parking areas located on the Demised Premises or the other areas of the
Demised Premises outside the Building other than landscaping or the restriping
of the parking areas located on the Demised Premises, or the roof or foundations
of the Building, (b) the supporting members or structural elements of the
Building, or (c) any of the Building systems in a material and adverse manner.
After the completion of Tenant's Work, Tenant shall make no
Alterations in or to the Demised Premises, whether structural or non-structural,
without Landlord's prior written consent, except as follows:
(a) Tenant may make non-structural Alterations in each instance
costing less than Fifty Thousand ($50,000) Dollars and decorative Alterations
costing less than One Hundred Thousand ($100,000) Dollars without obtaining
Landlord's consent.
(b) Landlord agrees that it shall not unreasonably withhold or delay
its consent to any other Alterations to the Demised Premises requested to be
made by Tenant.
(c) No structural Alterations in or to the Demised Premises shall be
made by Tenant without obtaining Landlord's prior consent in each case, which
consent shall not be unreasonably withheld or delayed.
All Alterations: (i) shall be done at Tenant's sole expense; (ii) may
be made at all hours and days; (iii) shall in all events comply with all Laws
and Ordinances and all orders, rules and regulations of Insurance Boards; (iv)
shall be made in a good workmanlike manner using materials comparable in quality
to the quality of the existing materials in the Demised Premises; and (v) shall,
in the case of structural Alterations, non-structural Alterations costing in
excess of Fifty Thousand ($50,000) Dollars and decorative Alterations costing in
excess of One Hundred Thousand ($100,000) Dollars, be made only by contractors
or mechanics approved by Landlord (which approval Landlord agrees not to
unreasonably withhold or delay).
11.2 Prior to commencing any Alterations, Tenant shall furnish to
Landlord, and obtain Landlord's prior written consent (unless said consent is
not required pursuant to subparagraph (a) of Section 11.1) to:
19
(i) Plans and specifications (to be prepared by and at the
expense of Tenant), in detail, of such proposed Alterations, and Landlord agrees
that provided Tenant otherwise complies with the provisions of this Article 11,
Landlord shall not unreasonably withhold or delay its consent to plans and
specifications in connection with Alterations, provided that Tenant shall not be
obligated to provide such plans and specifications for non-structural
Alterations costing less than Fifty Thousand ($50,000) Dollars, or decorative
Alterations costing less than One Hundred Thousand ($100,000) Dollars;
(ii) A certificate evidencing that Tenant (or Tenant's
contractors) has (have) procured and paid for workmen's compensation and
employer liability insurance covering all persons employed in connection with
the work who might assert claims for death or bodily injury against Landlord,
Tenant, the Land or the Building;
(iii) Such additional personal injury and property damage
insurance (over and above the insurance required to be carried by Tenant
pursuant to the provisions of Article 7) and builder's risk fire and other
casualty insurance as Landlord may reasonably require in connection with the
work to be done by Tenant; and
(iv) Such permits, authorizations or consents as may be
required by any applicable Law or Ordinance, all of which shall be obtained at
Tenant's expense; provided, however, that no plans, specifications or
applications shall be filed by Tenant with any governmental authority without
first obtaining Landlord's consent (which Landlord agrees not to unreasonably
withhold or delay to the extent provided elsewhere in this Article), except to
the extent authorized under subparagraph (a) of Section 11.1. Landlord agrees to
cooperate with Tenant's efforts to obtain such permits, authorizations and
consents. Without limiting the generality of the foregoing, Landlord shall
execute and deliver and/or join in the execution and delivery of any building or
alteration permit applicable requested by Tenant.
11.3 (Except for the property described in Section 11.5 which Tenant
may remove at the end of the Term) in no event shall any material or equipment
be incorporated in the Demised Premises in connection with any such Alteration
which is subject to any lien, encumbrance, chattel mortgage, security interest,
charge of any kind whatsoever, or is subject to any conditional sale or other
similar or dissimilar title retention agreement.
11.4 Upon the termination of this Lease, Tenant shall be required to
remove all Alterations with respect to which (i) Tenant was required to obtain
Landlord's consent pursuant to subparagraph (a) of Section 11.1 hereof, and (ii)
Landlord notified Tenant, at the time of Landlord's consent to the installation
of such Alteration, that Tenant would have to remove
20
the same from the Demised Premises at the termination of this Lease.
11.5 Where furnished by or at the expense of Tenant (except where
same is a replacement of an item theretofore furnished and paid for by Landlord
or against which Tenant has received a credit), all movable property, furniture,
furnishings, trade fixtures and equipment (including such trade fixtures and
equipment which may be attached to the Building due to the nature of Tenant's
business) shall remain the property of Tenant, and may be removed by Tenant on
or before the expiration of the Term, and, in case of damage by reason of the
removal, Tenant shall restore the Demised Premises to good order and condition,
normal wear and tear excepted. If Tenant shall fail to remove such property,
Landlord may remove such property, and dispose of it or place it in storage. Any
of such property not removed by Tenant shall, at the election of Landlord, be
deemed to be abandoned by Tenant, and Landlord may return or dispose of such
property as Landlord shall elect, without any liability to Tenant.
11.6 Except as provided in Sections 11.4 and 11.5, all of Landlord's
Work and all of Tenant's Work shall become the property of Landlord and shall
remain upon, and be surrendered with, said Demised Premises, as a part thereof,
at the end of the Term. Except as provided in Sections 11.4 and 11.5, all
Alterations upon the Demised Premises, made by either party subsequent to
Landlord's Work and Tenant's Work, affixed to the realty shall become the
property of Landlord and shall remain upon, and be surrendered with, said
Demised Premises, as a part thereof, at the end of the Term. Except as provided
in Sections 11.4 and 11.5, in no event shall Tenant be required or permitted to
remove (a) the original installations made by Landlord as part of Landlord's
Work or Tenant as part of Tenant's Work, or (b) Alterations, made by Tenant. Any
Alteration which is not removed by Tenant from the Building at the end of the
Term shall be deemed abandoned by Tenant to Landlord, and Landlord may remove
the same from the Demised Premises.
ARTICLE 12
CONDEMNATION
------------
12.1 In the event that all of the Demised Premises are taken or
condemned for any public purpose, this Lease shall terminate as of the date of
such taking; provided, however, that those provisions of this Lease which are
designated to cover matters of termination and the period thereafter shall
survive the termination hereof.
12.2 In the event that any portion of the Warehouse or more than
twenty percent (20%) of the Offices shall be taken or condemned for any public
purposes, or in the event of any taking or condemnation which prevents Tenant
from having access to any portion of the Warehouse or at least eighty percent
(80%) of the
21
Offices or which reduces the number of parking spaces available to Tenant below
ninety percent (90%) of the number of parking spaces available to Tenant
immediately prior to such taking or condemnation, then Tenant shall have the
option, exercisable within thirty (30) days after Tenant receives notice of such
taking or condemnation, to terminate this Lease effective as of the date
specified by Tenant in its notice of termination, which effective date shall not
be more than one (1) year after the date of Tenant's notice of termination;
provided, however, that those provisions of this Lease which are designated to
cover matters of termination and the period thereafter shall survive the
termination hereof; and provided further that Landlord may negate Tenant's
option to terminate this Lease pursuant to Section 12.2 by reason of any taking
of any portion of the Offices or any parking spaces if Landlord provides to
Tenant, in a location and condition satisfactory to Tenant, similar office space
of the same dimensions of those taken or condemned or an equal number of
substitute parking spaces in the immediate vicinity of the Building.
12.3 In the event that a portion, but less than all, of the Demised
Premises shall be taken or condemned for any public purpose or such taking or
condemnation shall result in a denial of access to a portion, but less than all,
of the Demised Premises, then this Lease shall terminate as of the date of such
taking as to the portion of the Demised Premises so taken or denied access, and,
unless Tenant exercises its option to terminate this Lease pursuant to Section
12.2 hereof, this Lease shall remain in full force and effect as to the
remainder of the Premises. In such event, the Fixed Minimum Rent will be
diminished by an amount representing the part thereof applicable to the portion
of the Demised Premise so taken, and Landlord shall restore the balance of the
Demised Premises to an architecturally complete unit with reasonable promptness.
12.4 In the event of the termination of this Lease pursuant to the
provisions of Sections 12.1 and 12.2, the Lease shall expire as of the date of
such termination in the same manner and with the same effect as if that were the
date set for the normal expiration of the Term, and Fixed Minimum Rent shall be
apportioned as of the date of termination. The provisions of this Section shall
apply in the same manner to any partial termination of this Lease pursuant to
the provisions of this Article 12.
12.5 Landlord may appear in any condemnation proceeding or action or
taking to negotiate, prosecute and adjust any claim for an award thereunder.
Landlord shall be entitled to receive the entire award in any condemnation
proceeding or action for taking, without deduction therefrom for any estate
vested in Tenant by this Lease; provided that nothing herein contained shall
prohibit Tenant from seeking severance damages, moving
22
expenses or any other award so long as any such award does not reduce the award
payable to Landlord.
12.6 If the temporary use or occupancy of all or any part of the
Demised Premises shall be condemned or taken for any public or quasi-public use
during the Term, this Lease shall be and remain unaffected by such condemnation
or taking and Tenant shall continue to pay the full Fixed Minimum Rent payable
hereunder and Tenant shall be entitled to receive the entire amount of any award
made for such taking, whether paid as damages, rent or otherwise, provided,
however, that in the event that: (i) any such temporary taking involves any
portion of the Warehouse or more than twenty percent (20%) of the Offices or
prevents Tenant from having access to any portion of the Warehouse or at least
eighty percent (80%) of the Offices or reduces the number of parking spaces
available to Tenant below ninety percent (90%) of the number of parking spaces
available to Tenant immediately prior to such taking, and (ii) such taking is
for a period of more than six (6) months, Tenant may elect to terminate this
Lease by notifying Landlord of such election within thirty (30) days after
Tenant receives notice of such taking, in which event this Lease shall terminate
as of the date specified in Tenant's notice of termination, which effective date
shall not be later than one (1) year after the date of Tenant's notice of
termination; provided, however, that the provisions of this Lease which are
designated to cover matters of termination and the period thereafter shall
survive the termination hereof. For purposes hereof, Offices and/or parking
spaces shall be deemed available to Tenant if alternative Offices and/or
substitute parking spaces are provided to Tenant in accordance with the
requirements of Section 12.2.
ARTICLE 13
ACCESS TO DEMISED PREMISES
--------------------------
13.1 Tenant shall permit Landlord and the authorized representatives
of Landlord, upon notice of not less than fifteen (15) days (except in
emergency), to enter the Demised Premises at all reasonable times during usual
business hours for the purpose of making any repairs required to be made by
Landlord to fulfill Landlord's obligations under this Lease, or inspecting the
Demised Premises, and after the notice and the expiration of the grace period
provided for in this Lease, for the purpose of curing any defaults on the part
of Tenant in the making of any necessary repairs to the Demised Premises, or in
the performance of any work therein that may be necessary to comply with any
Laws and Ordinances, or that may be necessary to prevent waste or deterioration
in connection with the Demised Premises. No prior notice of such entry shall be
necessary in the case of emergency, but Landlord agrees to provide Tenant with
written notice of its entry as soon thereafter as practicable. Nothing in this
section 13.1 shall imply any duty upon the part of Landlord to cure any such
defaults or to do any such work. The performance thereof by
23
Landlord shall not constitute a waiver of Tenant's default in failing to perform
the same. Landlord shall be liable for all damage to Tenant's property caused
by Landlord or Landlord's agents or employees in connection with the making of
repairs or the performance of any work in the Demised Premises or on account of
bringing materials, supplies and equipment into or through the Demised Premises
during the course thereof. Landlord must use its best efforts to minimize any
inconvenience or damage caused by Landlord in connection with the making of
repairs or performance of any work on the Demised Premises and to coordinate the
scheduling of such repairs, maintenance, or work with Tenant.
For a period commencing six (6) months prior to the end of the Term,
Landlord shall have reasonable access to the Demised Premises for the purposes
of exhibiting the same to prospective tenants and for posting any "To Let" or
"To Lease" signs upon the Demised Premises. The size and location of such signs
shall be subject to Tenant's approval, which approval may not be unreasonably
withheld.
ARTICLE 14
ASSIGNMENT, SUBLETTING, MORTGAGING
----------------------------------
14.1 Tenant covenants and agrees that neither this Lease nor the Term
and estate hereby granted, nor any part hereof or thereof, will be assigned,
mortgaged, pledged, encumbered or otherwise transferred, by Tenant or by
operation of law or otherwise, and that neither the Demised Premises, nor any
part thereof, will be sublet or occupied, by anyone other than Tenant, or for
any purpose other than as set forth in this Lease, without the prior written
consent of Landlord in every case, except as expressly provided in subparagraph
(c) hereinbelow.
Notwithstanding the foregoing provisions of this Section 14.1:
(a) Prior to the agreement by Tenant to any assignment or subletting,
Tenant shall submit to Landlord in writing: (1) the name of the proposed
assignee or subtenant; (2) a copy of the proposed written agreement including
all of the terms and conditions of the proposed assignment or subletting,
stating that such agreement shall not become effective unless Landlord hereunder
shall consent thereto in writing and which shall contain a provision complying
with Section 14.4; (3) the nature and character of the business of the proposed
assignee or subtenant and any other information reasonably requested by
Landlord; (4) a financial statement of the proposed assignee or subtenant,
certified to by a certified public accountant as of a date not more than twelve
(12) months prior thereto or if not available, such other financial information
as may be reasonably acceptable to Landlord; and (5) an agreement by Tenant to
indemnify, defend and hold Landlord harmless against any claim or liability for
real estate brokerage commission payable with
24
respect to any sublease or assignment by Tenant in accordance with this Article.
Provided Tenant is not in default hereunder (after notice from
Landlord if any be required hereunder and the expiration of any applicable grace
period)1 Landlord's consent to any such proposed assignment or subletting shall
not be "unreasonably" withheld or delayed, in accordance with paragraph (b).
This paragraph (a) shall apply to each and every proposed assignment and
sublease during the Term hereof, and if Tenant fails to consummate any proposed
assignment or sublease to which Landlord shall have consented within one hundred
eighty (180) days after granting such consent, this paragraph (a) shall again
apply to said proposed assignment or sublease.
(b) In determining reasonableness, Landlord may take into
consideration all relevant factors surrounding the proposed sublease or
assignment, including, without limitation, the following:
(i) the financial stability and business reputation of the
proposed assignee or subtenant;
(ii) the nature of the business and the proposed use of the
Demised Premises by the proposed assignee or subtenant in relation to the
majority of other tenants in the Park;
(iii) the proposed assignee or subtenant shall not be a
tenant of other space in the Park, and shall not be entitled directly or
indirectly to diplomatic or sovereign immunity; and
(iv) not more than two (2) unrelated entities shall occupy
the Demised Premises at any time.
(c) Notwithstanding any contrary provision of this Lease, provided
Tenant shall not be in default hereunder (which continues after notice and the
expiration of any applicable grace period), this Lease may be assigned at any
time without the consent of Landlord, to any corporation into which or with
which Tenant may be merged or consolidated, or to any corporation which shall
purchase all or substantially all of the assets of Tenant, or assigned or sublet
in whole or in part to any subsidiary or affiliate of Tenant, provided each of
the following conditions shall be complied with:
(i) If such assignment shall be to a successor by merger or
consolidation, or by acquisition of assets, such successor shall have acquired
all or substantially all of the assets of the assignor;
25
(ii) If such assignment or sublease shall be to a subsidiary
or affiliate, such subsidiary or affiliate shall have assumed all of the
liabilities hereunder of the assignor, and the assignor shall have expressly
agreed to continue to remain jointly and severally liable as Tenant hereunder;
(iii) The assumptions and agreement referred to in
subparagraphs (i) and (ii) above, shall be set forth in written instruments
complying with the provisions of Section 14.4 of this Lease; and
(iv) The assignee or sublessee shall at all times use the
Demised Premises for a purpose permitted by Article 4 hereof; and
(v) Subdivision (iv) of paragraph (b) above shall apply.
For the purposes of this paragraph, a corporation shall be deemed to
be a subsidiary of Tenant if fifty (50%) percent or more of its voting stock
shall be owned by Tenant, and a corporation or other person or entity shall be
deemed to be an affiliate of Tenant if it directly or indirectly controls, is
controlled by or is under common control with Tenant.
(d) Notwithstanding the provisions of subparagraphs (b) and (c)
above, Tenant shall obtain, at Tenant's cost and expense, all necessary
governmental consents and approvals for the occupancy of the Demised Premises,
or any portion thereof, by such permitted assignee or sublessee.
(e) In the event of the sale or other disposition of all or
substantially all of the assets of Tenant during the Term of this Lease, the
transferee of assets shall be deemed to have assumed all obligations, covenants
and responsibilities of Tenant under this Lease. Upon request of Landlord, the
transferee of assets shall deliver to Landlord an instrument in recordable form
evidencing the aforesaid assumption of this Lease.
14.2 If this Lease is assigned or if the Demised Premises is sublet
or occupied by anyone other than Tenant, and if Tenant is in default (after
notice from Landlord if any be required hereunder and the expiration of any
applicable grace period), Landlord may collect Fixed Minimum Rent, Additional
Rent and other charges from the assignee, sublessee or occupant, and apply the
net amount collected to the Fixed Minimum Rent, Additional Rent and other
charges herein provided, but no such assignment, subletting, occupancy or
collection shall be deemed a waiver of the covenant by Tenant under Section
14.1, nor shall the same be deemed the acceptance of the assignee, sublessee or
occupant as a tenant, or a release of Tenant from the further performance of the
covenants and agreements contained in this Lease on the part of Tenant to be
performed.
26
14.3 The consent by Landlord to an assignment or subletting shall not
relieve Tenant, the assignee or subtenant from obtaining the express consent in
writing of Landlord to any further assignment or subletting required pursuant to
this Article 14.
14.4 Each permitted assignee or transferee of this Lease shall assume
and be deemed to have assumed this Lease and shall be and remain liable jointly
and severally with Tenant for the payment of the Fixed Minimum Rent, Additional
Rent and other charges, and for the due performance of and compliance with all
of the terms, covenants, conditions and agreements contained in this Lease on
Tenant's part to be performed or complied with for the Term. No assignment,
sublease or transfer shall be binding on Landlord unless such assignee,
subtenant or transferee of Tenant shall deliver to Landlord a duplicate original
of the instrument of assignment, sublease or transfer which (i) contains a
covenant of assumption by the assignee or transferee (other than a subtenant) of
all of the obligations aforesaid, (ii) contains a confirmation that Landlord
shall have all of the rights set forth in this Article as to any further
assignment or subletting superior to and preemptive of any rights of sublessor
thereunder, and (iii) in every case, other than pursuant to Section 14.1(c)
hereof Landlord shall have consented thereto in advance in writing as required
hereunder. In the event of Tenant's failure to comply with the provisions of
this Article, Landlord may elect to treat such purported assignee, subtenant or
transferee as having assumed this Lease jointly and severally with Tenant,
without in any way or to any extent binding Landlord to consent to such
purported assignment, sublease or transfer.
14.5 If Landlord shall for any reason or cause recover or come into
possession of said Demised Premises before the date hereinbefore fixed for the
expiration of the Term, Landlord shall have the right at its option to take over
any and all subleases or subletting of the Demised Premises or any part or parts
thereof made or granted by Tenant and to succeed to the rights and privileges of
Tenant with respect to said subleases and subletting or such of them as it may
elect to take over and assume, and Tenant hereby expressly assigns and transfers
to Landlord such of the subleases and subletting as Landlord may elect to take
over and assume at the time of such recovery of possession, and Tenant shall
upon request of Landlord execute, acknowledge and deliver to Landlord such
further assignments and transfers as may be necessary, sufficient and proper to
vest in Landlord the then existing subleases and subletting. By its acceptance
of and entry- into a sublease, subtenant thereunder shall be deemed to have
thereby agreed that, at Landlord's election, such subtenant shall be bound to
Landlord for the balance of the term of such sublease and shall attorn to
Landlord, as its landlord, under all of the terms, covenants and conditions of
such Sublease.
27
ARTICLE 15
SIGNS. ETC.
----------
15.1 Tenant shall not erect any signs on the Demised Premises without
Landlord's prior written consent, which consent Landlord agrees not to
unreasonably withhold. All such signs must conform to all Laws and Ordinances.
ARTICLE 16
IMPOSITIONS
-----------
16.1 Tenant agrees to pay to the appropriate taxing authority, all
Impositions (as hereinafter defined) and to provide Landlord with proof of the
payment thereof upon Landlord's request. Such Impositions shall be paid prior
to delinquency. If, at Tenant's option, Tenant pays the Impositions to Landlord
rather than to the appropriate taxing authority, Landlord agrees to pay or cause
to be paid all such monies to the appropriate authorities prior to delinquency.
16.2 As used herein the term "Impositions" shall mean: (a) all taxes,
assessments, levies, fees, water and sewer rents and charges, and all other
governmental charges, general and special, ordinary and extraordinary, and
whether or not the same shall have been within the express contemplation of the
parties hereto, together with any interest and penalties thereon, which are
imposed or levied upon or assessed against (i) all or any part of the Demised
Premises, (ii) the Fixed Minimum Rent, Additional Rent or other charges payable
by Tenant hereunder, or (iii) this Lease or the leasehold estate created hereby;
(b) any gross receipts, gross income, rental income or similar taxes which fail
to take into account deductions with respect to the Demised Premises such as
depreciation, interest, taxes or ordinary and necessary business expenses,
imposed or levied upon, assessed against or measured solely by the Fixed Minimum
Rent, Additional Rent or other charges to be paid by Tenant hereunder and
without regard to other income of Landlord; (c) all sales and use taxes which
may be levied or assessed against or be payable by Landlord or Tenant on account
of the leasing or use of all or any part of the Demised Premises; and (d) all
other taxes and charges in the same or similar categories. Tenant shall not be
required to pay any franchise, corporate, capital levy, estate, inheritance,
succession, transfer, federal, state, municipal or other income, profit or
revenue or similar taxes assessed or imposed against Landlord, the Demised
Premises, this Lease or any Fixed Minimum Rent or Additional Rent or other
charges due hereunder (other than any gross receipts, gross income or similar
taxes which fail to take into account deductions with respect to the Demised
Premises such as depreciation, interest, taxes or ordinary and necessary
business expenses, imposed or levied upon, assessed against or measured solely
by the Fixed Minimum Rent, Additional Rent or other charges to be paid by Tenant
hereunder, and without regard to other income of Landlord).
28
16.3 To the extent that the same may be permitted by law, Tenant
shall have the right to apply for the conversion of any assessment for local
improvements assessed during the term of this Lease to be payable in annual
installments over the maximum time permitted by the municipal authority imposing
the same and upon such conversion Tenant shall be responsible for the payment of
only such installments thereof as shall be allocable to the term of this Lease.
Impositions, whether or not a lien upon the Demised Premises, shall be
apportioned between Landlord and Tenant at the beginning and end of the term of
this Lease; it being intended that Tenant shall pay only that portion of the
Impositions as is allocable to the term of this Lease; provided, however, that
Landlord need not make any apportionment in Tenant's favor if the term of this
Lease shall be terminated by reason of a default on the part of Tenant hereunder
unless and until such default is cured.
16.4 Tenant, at its own expense, may contest any Impositions,
including a proceeding to reduce the assessed value of the Demised Premises
through tax certiori proceedings, in any manner permitted by law, in Tenant's
name, and whenever necessary in Landlord's name. Landlord agrees that if
requested by Tenant, Landlord will remit Tenant's payments for Impositions to
the appropriate authority under protest. Landlord will cooperate with Tenant
and execute any documents or pleadings reasonably required for such purpose;
provided, however, that the same shall be without cost, liability or expense to
Landlord. Such contest may include appeals from any judgment, decree or order
until a final determination is made by a court or governmental department or
authority having final jurisdiction in the matter. However, notwithstanding
such contest, Tenant shall promptly pay the contested Impositions in the manner
provided for in this Article, if at any time the Demised Premises or any part
thereof shall, as a result of the deferment of such payment, be subject to
forfeiture or if Landlord shall be subject to any criminal liability by reason
of the non-payment thereof. Any tax refund with respect to any Imposition paid
by Tenant shall, to the extent thereof, be the property of Tenant. Landlord, at
its expense, may contest any Imposition only in the event that Tenant is not
actively contesting any such Imposition, provided that Landlord provides Tenant
with written notice of its intention to contest such Imposition prior to the
commencement thereof.
ARTICLE 17
RIGHT TO CURE DEFAULTS
----------------------
17.1 If Tenant shall fail to comply fully with any of its obligations
under this Lease (including without limitation, its obligations to make repairs,
maintain insurance, comply with all laws, ordinances and regulations and pay all
bills for utilities) after receipt of written notice of such failure from
Landlord and the expiration of any applicable grace periods, then Landlord shall
have the right, at its option, to cure such breach
29
at Tenant's expense. Tenant agrees to reimburse Landlord for all costs and
expenses incurred as a result thereof together with the Default Charge which
Default Charge shall not begin to accrue until the date that Tenant receives a
written demand for such reimbursement from Landlord.
17.2 Without limiting any rights granted to Tenant under Article 20.3
hereof, and notwithstanding any contrary provision of this Lease, if Landlord
shall fail to fully comply with any of its obligations under this Lease
(including without limitation, its obligations to make repairs or restoration in
connection with a casualty) and such failure shall continue for thirty (30) days
after receipt of written notice of such default from Tenant, Tenant shall
thereafter, upon notice to Landlord, have the right to cure such default at
Landlord's expense; provided, however, that if the said default shall be of a
nature that the same cannot be completely cured or remedied within said thirty
(30) day period and if Landlord shall commence the curing of such default
promptly, then the time of Landlord within which to cure the same shall be
extended for such period as may be necessary to complete the same with all due
diligence. Landlord agrees to promptly reimburse Tenant for any costs and
expenses incurred as a result thereof, together with interest thereon at the
Default Charge. If Landlord does not reimburse Tenant within ten (10) business
days of its receipt of a written request thereof from Tenant, Tenant shall be
entitled to offset and deduct such expenses from the next Fixed Minimum Rent
payment due hereunder.
ARTICLE 18
BANKRUPTCY
---------
18.1 This Lease may be canceled by Landlord after the happening of
any one or more of the following events: (1) the commencement of a case in
bankruptcy or under the laws of any State naming Tenant as the debtor; or (2)
the making by Tenant of an assignment or any other arrangement for the benefit
of creditors under any State statute. Landlord, (a) at any time after receipt of
notice of the occurrence of any such event, or (b) if such event occurs without
the acquiescence of Tenant, at any time after the event continues for one
hundred twenty (120) days, may give Tenant a notice of intention to end the Term
of this Lease at the expiration of five (5) days from the date of service of
such notice of intention and, upon the expiration of said five (5) day period,
this Lease and the Term and estate hereby granted shall terminate with the same
effect as if that date were expressly set forth in this Lease, but Tenant shall
remain liable for damages as hereinafter provided. Neither Tenant nor any person
claiming through or under Tenant, or by reason of any statute or order of court,
shall thereafter be entitled to possession of the Demised Premises but shall
forthwith quit and surrender the Demised Premises.
30
18.2 It is stipulated and agreed that in the event of the termination of
this Lease pursuant to Section 18.1, Landlord shall forthwith, notwithstanding
any other provisions of this Lease to the contrary, be entitled to recover from
Tenant as and for liquidated damages an amount equal to the excess of the rent
reserved hereunder for the unexpired portion of the Term demised over the then
fair and reasonable rental value of the Demised Premises for the same period. In
the computation of such damages the difference between any installment of rent
becoming due hereunder after the date of termination and the fair and reasonable
rental value of the Demised Premises for the period for which such installment
was payable shall be discounted to the date of termination at the annual rate of
interest payable with respect to the first mortgage encumbering the Demised
Premises. Nothing herein contained shall limit or prejudice the right of the
Landlord to prove for and obtain as liquidated damages (in lieu of other
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, equal to or less than the amount of the difference referred to
above.
ARTICLE 19
DEFAULT
-------
19.1 If Tenant shall: (a) (i) default in the payment of the Fixed Minimum
Rent or any other item of Rental reserved herein payable on a regular monthly
basis for ten (10) days after Tenant's receipt of written notice of such
default, or (ii) in the payment of any other obligation involving the payment of
money within ten (10) business days after receipt of written notice from
Landlord; or (b) default in the observance of any of the other terms, covenants
and conditions of this Lease (except those expressly enumerated in this Section
19.1) and such default shall continue for more than thirty (30) business days
after written notice of such default, provided, however, that if the said
default shall be of a nature that the same cannot be completely cured or
remedied within said thirty (30) business day period and if Tenant shall
commence the curing of such default promptly, then the time of Tenant within
which to cure the same shall be extended for such period as may be necessary to
complete the same with all due diligence; or (c) if the Demised Premise shall be
occupied by someone other than Tenant in violation of the provisions of this
Lease and such occupancy shall continue for thirty (30) business days after
Tenant's receipt of written notice of such violation, or (d) if this Lease shall
be assigned or pass to or devolve upon one other than Tenant, except as herein
permitted; (e) if a receiver or trustee of Tenant and/or its property shall be
appointed in any proceedings other than bankruptcy proceedings and such
appointments, if made in proceedings instituted by or against Tenant, shall not
be vacated within one hundred twenty (120) business days after it has been
31
made; or (f) Tenant shall vacate the Demised Premises or any substantial portion
of the Demised Premises for any consecutive period in excess of eighteen (18)
months, it being agreed that Tenant shall not be in default under this Lease if
Tenant vacates the Demised Premises or any substantial portion of the Demised
Premises for a consecutive period of less than eighteen (18) months provided
that Tenant fulfills all of its obligations under this Lease (including, but not
limited to, the obligations contained in Article 7 hereof) during such period,
and provided further that Tenant provides Landlord with reasonable assurances
that Tenant will continue to fulfill its obligations hereunder, then upon the
happening of any one or more of the defaults or events above mentioned in this
Article and the continuance thereof beyond the applicable cure period, this
Lease and the Term hereof shall upon the date specified in a notice, which date
shall be not less than five (5) business days after the date of sending of such
notice by Landlord to Tenant, wholly cease and expire, with the same force and
effect as though the date so specified were the date hereinabove first set forth
as the date of the expiration of the Term (but Tenant shall remain liable to
Landlord as hereinafter provided); and thereupon, or at any time thereafter,
Landlord may recover possession thereof in the manner prescribed by the statute
relating to summary proceedings, or similar statutes (but Tenant shall remain
liable to Landlord as hereinafter provided), it being understood that no demand
for reentry for condition broken and no notice to quit possession or other
notices prescribed by statute shall be necessary to enable Landlord to recover
such possession but that all right to any such demand and any such re-entry and
any notice to quit possession or other statutory notices or prerequisites are
hereby expressly waived by Tenant to the extent such waiver is permitted by law.
19.2 Notwithstanding any other provision in this Article, no termination,
re-entry, or dispossess by summary proceedings or otherwise, no termination by
operation of law or otherwise, and no reletting of the Demised Premises shall
relieve Tenant of its liabilities and obligations hereunder, all of which shall
survive such termination, re-entry, repossession or reletting.
19.3 In case of any such termination, re-entry, or dispossess by summary
proceedings or otherwise, the Fixed Minimum Rent, Additional Rent and all other
charges required to be paid by Tenant hereunder shall thereupon become due and
be paid up to the time of such termination, re-entry or dispossess, and Tenant
shall also pay to Landlord all reasonable expenses which Landlord may then or
thereafter incur for attorneys' fees, brokerage commissions, and all other costs
paid or incurred by Landlord for recovering and restoring the Demised Premises
to good order and condition and for preparing the same for re-letting. Landlord
may, at any time and from time to time, re-let the Demised Premises, in whole or
in part, either in its own name or as agent
32
of Tenant, for a term or terms which at Landlord's option, may be for the
remainder of the Term of this Lease or for any longer or shorter period, and
(unless the statute or rule of law which governs or shall govern the proceeding
in which such damages are to be proved, limits or shall limit the amount of such
claim capable of being so proved and allowed, in which case Landlord shall be
entitled to prove as and for liquidated damages and have allowed an amount equal
to the maximum allowed by or under any such statute or rule of law) Tenant shall
be obligated to and shall pay to Landlord as damages, upon demand, and Landlord
shall be entitled to recover from Tenant damages (payable in monthly
installments, in advance, on the first day of each calendar month following such
termination, re-entry or dispossess, and continuing until the date originally
fixed herein for the expiration of the Term) in an amount or amounts equal to
the excess, if any, of the sum of the aggregate expenses paid by Landlord during
the month immediately preceding such calendar month for all such items as, by
the terms of this Lease, are required to be paid by Tenant, plus an amount equal
to the amount of the installment of Fixed Minimum Rent which would have been
payable by Tenant hereunder in respect of such calendar month, had this Lease
and the Term not been so terminated, or had Landlord not so re-entered, over the
rents, if any, collected by Landlord in respect of such calendar month pursuant
to such reletting (provided that if Landlord acted unreasonably in connection
with such reletting, given the market conditions then existing, Landlord shall
be deemed to have collected the fair market rental value of the Demised Premises
in respect of such calendar month), and any suit or action brought to collect
the amount of the deficiency for any month shall not prejudice in any way the
rights of Landlord to collect the deficiency for any subsequent month by a
similar proceeding. Provided that Landlord acts reasonably and in good faith,
(i) Landlord shall in no event be liable in any way whatever for failure to re-
let the Demised Premises and Landlord shall have no obligation or affirmative
duty to re-let or attempt to re-let the Demised Premises, nor to accept a new
tenant suggested by or supplied by Tenant and (ii) in the event that the Demised
Premises are re-let, Landlord shall not be liable for failure to collect the
rent thereof under such re-letting.
19.4 Landlord, at Landlord's option, may make such alterations, repairs,
replacements and/or decorations in the Demised Premises as Landlord, in
Landlord's sole reasonable judgment, considers advisable and necessary for the
purpose of reletting the Demised Premises; and the making of such alterations
and/or decorations shall not operate or be construed to release Tenant from
liability hereunder.
19.5 In the event of a breach or threatened breach by Tenant of any of the
covenants or provisions of this Lease, Landlord shall have the right to seek an
injunction and the right to invoke any remedy allowed at law or in equity as if
reentry,
33
summary proceedings and other remedies were not herein provided for. Mention in
this Lease of any particular remedy shall not preclude Landlord from any other
remedy, in law or in equity.
19.6 No receipt of Rental by Landlord from Tenant after the termination in
any way of this Lease or after giving any notice, shall reinstate, continue or
extend the Term, or affect any notice. No receipt of Rental after the
commencement of suit, or after final judgment for possession of the Demised
Premises, shall reinstate, continue or extend the Term or affect said suit or
said judgment.
ARTICLE 20
SUBORDINATION, ATTORNMENT AND NON-DISTURBANCE
---------------------------------------------
20.1 This Lease, at the option of Landlord or any Mortgagee or
Overlandlord, shall be or shall become subject and subordinate, to all
Overleases, and to all Mortgages, and all advances thereon, which may now or
hereafter affect this Lease or the Demised Premises, and to all renewals,
modifications, consolidations, participations, replacements and extensions of
such Overleases and/or Mortgages; provided, however, any such Mortgagee or
Overlandlord must execute and deliver to Tenant an agreement substantially in
the form of Exhibit F attached hereto (a "Non-Disturbance Agreement") containing
provisions to the effect that, as long as Tenant is not in default under the
terms, covenants and conditions of this Lease beyond any grace period provided
in this Lease for remedying the same, in any action or proceeding to terminate
the Overlease, or to foreclose the Mortgage, Tenant will not be made a party
defendant, that Tenant's possession of the Demised Premises will not be
disturbed, and that Tenant's leasehold estate and its rights and remedies
hereunder will not be affected, impaired or terminated by any such action or
proceeding or by any judgment or order rendered therein. The term "Mortgages" as
used herein shall be deemed to include trust indentures and deeds of trust.
In the event that Landlord, any Mortgagee or any Overlandlord elects to
subject and subordinate this Lease as mentioned in the preceding paragraph, then
Landlord or its Mortgagee or Overlandlord shall give Tenant notice to such
effect, and provided that such Mortgagee or Overlandlord shall have duly
executed and delivered to Tenant a Non-Disturbance Agreement, immediately
thereafter the aforesaid provisions shall be self-operative and no further
instrument of subordination shall be required. In the event Landlord or any
Overlandlord or any Mortgagee desires confirmation of such subordination, Tenant
shall execute promptly a confirmatory certificate in form reasonably acceptable
to Tenant upon Landlord's request.
20.2 Tenant agrees that neither the cancellation nor the termination of
any Overlease, nor any foreclosure of any Mortgage, nor any proceeding to
recover possession of the Demised
34
Premises shall by operation of law or otherwise result in the cancellation or
termination of this Lease or the obligations of the Tenant hereunder. Tenant
covenants and agrees that upon delivery of a duly executed Non-Disturbance
Agreement, it shall attorn to any Mortgagee or Overlandlord or to the purchaser
of the Demised Premises in foreclosure or the sale of the Overlease, or any of
their respective successors or assigns or any other person claiming by or
through any such Mortgagee, or the Overlandlord, or by or through any
foreclosure proceeding of any such Mortgage, or any proceeding with respect to
such Overlease, who shall succeed to the rights of Landlord under this Lease;
and Tenant shall recognize such successor as Tenant's landlord under this Lease.
Upon such attornment this Lease shall continue in full force and effect as a
direct lease between Tenant and such successor landlord, upon and subject to all
of the terms, covenants and conditions of this Lease with the same force and
effect as if this Lease had originally been entered into by such successor
landlord and Tenant; except that such successor landlord and each succeeding
landlord shall not be: (a) liable for any act or omission of any prior landlord
(including Landlord); (b) subject to any offset, defense or counterclaim which
Tenant might have against any prior landlord (including Landlord); (c) bound by
any prepayments of more than one (1) month's Fixed Minimum Rent or additional
rent which Tenant may have paid to any prior landlord (including Landlord); or
(d) bound by any amendment or modification of this Lease made without its
consent. The provisions of this Article shall be self-operative, and no
instrument of attornment shall be required or needed. In confirmation of any
such attornment, Tenant shall promptly execute and deliver such instruments as
may be reasonably required.
20.3 In the event of any act or omission by Landlord which would give
Tenant the right to terminate this Lease or claim a partial or total eviction,
or, except pursuant to Section 17.2, make any claim against Landlord for the
payment of money, Tenant will not exercise such right until it has given written
notice of such act or omission to
(i) the Landlord; and
(ii) the Mortgagee and the Overlandlord as to whom Landlord has
instructed Tenant to give copies of all of Tenant's notices to Landlord,
and unless Landlord shall not have remedied such act or omission within thirty
(30) days from its receipt of such written notice, or, if such act or omission
cannot be remedied by the payment of money and is not capable of being remedied
within said thirty (30) day period, Landlord shall not have commenced the remedy
of such act or omission within said thirty day period or shall not diligently
pursue the completion of such remedy. Nothing herein contained shall be deemed
to create any rights in Tenant not
35
specifically granted in this Lease or under any applicable provision of law.
ARTICLE 21
SURRENDER OF DEMISED PREMISES
-----------------------------
21.1 On the last day or sooner termination of the Term, Tenant shall quit
and surrender the Demised Premises broom clean, in good condition and repair
(reasonable wear and tear, casualty and condemnation excepted), as provided in
Sections 11.4, 11.5 and 11.6 of this Lease. If the Demised Premises be not
surrendered as and when aforesaid and such failure to surrender shall continue
for three (3) months thereafter, Tenant shall indemnify Landlord against loss or
liability directly resulting from the delay by Tenant in so surrendering the
Demised Premises, including, without limitation, any claims made by any
succeeding occupant or prospective occupant of the Demised Premises founded upon
such delay. Upon expiration of the then current term of this Lease, without
premature termination, for the number of days that Tenant remains in possession
of the Demised Premises, without the execution of a new lease, Tenant shall be
deemed to be occupying said Demised Premises at a Rental equal to 125% of the
amount of the Rental (Fixed Minimum Rent), and 100% of the additional charges
herein provided for each month or part thereof and otherwise be subject to all
the conditions, provisions, and obligations of this Lease insofar as the same
are applicable to a month-to-month tenancy.
Tenant's obligations under this Article 21 shall survive the expiration or
sooner termination of the Term.
ARTICLE 22
CERTIFICATES AND FINANCIAL STATEMENTS
-------------------------------------
22.1 Tenant shall, without charge, at any time and from time to time
hereafter but not more often than four (4) times each year, within twenty (20)
days after written request of Landlord, certify by a written instrument duly
executed and acknowledged to any mortgagee or purchaser, or proposed mortgagee
or proposed purchaser, or any other person, firm or corporation specified in
such request: (a) as to whether this Lease has been supplemented or amended and
if so the substance and manner of such supplement or amendment; (b) as to the
validity and force and effect of this Lease, in accordance with its tenor as
then constituted; (c) as to the existence of any default by Landlord hereunder
known to Tenant; (d) as to the existence of any offsets, counterclaims or
defenses thereto on the part of Tenant known to Tenant; (e) as to commencement
and expiration dates of the Term; and (f) as to any other matters as may
reasonably be so requested. Any such certificate may be relied upon by Landlord
and any other person, firm or corporation to whom the same may be exhibited or
delivered; and the contents of such certificate shall be binding on Tenant.
36
22.2 Landlord shall, without charge, at any time and from tine to time
hereafter but not more often than four (4) times each year, within twenty (20)
days after written request of Tenant, certify by a written instrument duly
executed and acknowledged to any mortgagee, sublessee or assignee or proposed
mortgagee, proposed sublessee or proposed assignee, or any other person, firm or
corporation specified in such request: (a) as to whether this Lease has been
supplemented or amended and if so the substance and manner of such supplement or
amendment; (b) as to the validity and force and effect of this Lease, in
accordance with its tenor as then constituted; (c) as to the existence of any
default by Tenant hereunder known to Landlord; (d) as to the existence of any
counterclaims or defenses thereto on the part of Landlord known to Landlord; (e)
as to commencement and expiration dates of the Term; and (f) as to any other
matters as may reasonably be so requested. Any such certificate may be relied
upon by Tenant and any other person, firm or corporation to whom the same may be
exhibited or delivered; and the contents of such certificate shall be binding on
Landlord.
22.3 In addition to the provisions of Section 22.1 of this Lease, Tenant
agrees to furnish directly to Landlord's proposed lender upon Landlord's
request, within six (6) months from the end of each of Tenant's fiscal years,
Tenant's consolidated financial statements prepared by independent certified
public accountants. Landlord agrees to keep such financial information
confidential; and to deliver such statements only to the party proposing to give
such financing and/or proposing to purchase the Demised Premises or the Park and
only if such party agrees, in a manner reasonably acceptable to Tenant, to
preserve such confidentiality.
ARTICLE 23
WAIVER OF TRIAL BY JURY
-----------------------
23.1 It is mutually agreed by and between Landlord and Tenant that the
respective parties hereto shall and they hereby do waive trial by jury in any
action, proceeding or counterclaim brought by either of the parties hereto
against the other on any matters whatsoever arising out of or in any way
connection with this Lease, the relationship of Landlord and Tenant, Tenant's
use or occupancy of the Demised Premises, and/or any claim of injury or damage.
ARTICLE 24
QUIET ENJOYMENT
---------------
24.1 Landlord covenants and agrees with Tenant that upon Tenant paying the
Rental and observing and performing all the terms, covenants and conditions on
Tenant's part to be observed and performed, Tenant may peaceably and quietly
enjoy the Demised Premises without hindrance or ejection by Landlord or
37
any persons claiming under Landlord; subject, however, to the terms of this
Lease.
ARTICLE 25
BROKER
------
25.1 Tenant covenants, warrants and represents that Tenant has not dealt
with any broker in connection with this Lease, other than Landlord's broker,
Spectra Realty, and any other person or entity identified by Tenant in writing
to Landlord. Tenant agrees to hold Landlord harmless against any liability or
expense arising out of a misrepresentation by Tenant in the preceding sentence.
Landlord agrees to be responsible for any brokerage commissions which may be
payable to Spectra Realty, and hereby agrees to indemnify Tenant from any claims
of Spectra Realty or any other person or entity claiming a commission in
connection with this Lease, including all costs and expenses in connection
therewith.
ARTICLE 26
PARTIES BOUND
-------------
26.1 The obligations of this Lease shall bind and benefit the successors
and assigns of the parties with the same effect as if mentioned in each instance
where a party is named or referred to, except that no violation of the
provisions of Article 14 shall operate to vest any rights in any successor or
assignee of Tenant and that the provisions of this Article shall not be
construed as modifying the provisions of Article 14. All covenants and
agreements of this Lease shall run with the Land. The term "Landlord" as used in
this Lease means only the owner or the mortgagee in possession for the time
being of the Demised Premises so that in the event of any sale of said Demised
Premises or an assignment of this Lease Landlord shall be and hereby is entirely
freed and relieved of all obligations of Landlord hereunder and it shall be
deemed without further agreement between the parties and such purchaser(s) or
assignee(s) that the purchaser or assignee has assumed and agreed to observe and
perform all obligations of Landlord hereunder, subject to the exculpation
provisions of the immediately following paragraph.
Notwithstanding anything to the contrary provided in this Lease, it is
understood and agreed that, except in the case of fraud or intentional
misconduct by Landlord in connection with this Lease or the misapplication of
any funds, insurance proceeds or condemnation awards received by Landlord under
or in connection with this Lease, there shall be no personal liability on the
part of Landlord or any officer, director, shareholder or agent of Landlord (or
any successor corporate landlord or any partner of any limited or general
partnership which may become Landlord or any individual or other entity) to
Tenant with respect to any of the terms, covenants and conditions of this
38
Lease except to the extent of the Demised Premises and the proceeds thereof, and
Tenant agrees that it shall look solely to the Demised Premises and the proceeds
thereof for the satisfaction of any claims, debts, demands or judgments of
Tenant in the event of breach or default by Landlord under the terms of this
Lease, except in the case of fraud or intentional misconduct by Landlord in
connection with this Lease or the misapplication of any funds, insurance
proceeds or condemnation awards received by Landlord under or in connection with
this Lease. No other property or assets of Landlord shall be subject to
judgment, levy, execution or other enforcement procedure for the satisfaction of
Tenant's remedies under or with respect to this Lease, the relationship of
Landlord and Tenant hereunder or Tenant's use or occupancy of the Demised
Premises. The foregoing shall not limit or restrict Tenant's right to obtain as
against Landlord affirmative or negative injunctive relief or any other relief
similar to such injunctive relief.
ARTICLE 27
NOTICES
-------
27.1 Any notice, consent or approval provided for herein must be in
writing and shall be deemed duly given by the sender thereof to the addressee
thereof only if mailed to such addressee by registered or certified mail,
postage prepaid, or by sending the same via Federal Express, Purolator Courier
or other overnight courier service which delivers only upon signed receipt of
the addressee, return receipt requested, to the addressee as set forth on page 1
of this Lease. If such writing is addressed to Tenant, it shall be to the
attention of General Counsel; and a copy shall be sent in a similar manner to:
Proskauer Rose Goetz & Mendelsohn, 1585 Broadway, New York, New York 10036,
Attention: Perry A. Cacace, Esq. If such writing is addressed to Landlord, it
shall be sent to the attention of Harold Lepler; and a copy shall be sent in a
similar manner to Theodore J. Malvin, Suite 2101, Eleven Pennsylvania Plaza, New
York, New York 10001. The time of the giving of any notice shall be the time of
receipt thereof by the addressee or any agent of the addressee, except that in
the event the addressee or such agent of the addressee shall refuse to receive
any notice given by registered mail or certified mail as above provided the time
of the giving of such notice shall be the time of such refusal. If the sender of
any notice to any addressee shall have previously been given notice by said
addressee of a change of address of said addressee, such changed address shall
thereafter as to such sender be deemed the address to which future notices shall
be sent.
ARTICLE 28
EASEMENTS
---------
28.1 Tenant hereby grants to Landlord an easement or easements for
Landlord or any designee of Landlord in, to, or through all areas of the Demised
Premises, except the Building,
39
for the installation, repair, maintenance and replacement of pipes, cables,
conduits and wires at reasonable times and upon reasonable written notice to
Tenant to the extent that Landlord may now or hereafter deem to be necessary or
appropriate for the proper operation and maintenance of the Demised Premises or
any other portion of the Park or which may be required by Laws and Ordinances,
provided that Tenant shall have the right to approve the location of such pipes,
cables, conduits and wires and provided further that Landlord's installation,
repair, maintenance or replacement thereof does not substantially interfere with
any of the parking spaces located on the Demised Premises. Landlord agrees to
cause the least interference with Tenant's use of the Demised Premises. All such
work shall be done in such manner as to cause the least interference with
Tenant's use of the Demised Premises, and Landlord shall repair and replace all
areas of the Demised Premises damaged by such installation, repair, maintenance
and replacement to the same condition as existed immediately prior to the
commencement of such work.
ARTICLE 29
OFFICE PARK
-----------
29.1 Landlord and owners of other property intend to develop, or cause to
be developed, a first class corporate/industrial park; but nothing herein
contained shall be deemed a representation by Landlord (or a requirement that
Landlord) construct any portion of the Park or the size of the Park nor shall
Landlord be limited from time to time in changing the size thereof. Tenant
agrees to keep the Land clean of unsightly objects or debris. Tenant shall
maintain the landscaping on the Demised Premises as set forth in the final
approved subdivision plan and as initially installed by Landlord. All
landscaping areas shall be maintained in good order and condition, including
watering when necessary for continued growth and cutting; and no weeds or
underbrush nor unsightly growth of any kind shall be permitted. There shall be
no outside storage, except for adequately screened garbage dumpsters, provided
same are permitted by Laws and Ordinances.
ARTICLE 30
MISCELLANEOUS
-------------
30.1 One or more waivers of any covenant or condition by Landlord shall
not be construed as a waiver of a subsequent breach of the same or any other
covenant or condition, and the consent or approval by Landlord to or of any act
by Tenant requiring Landlord's consent or approval shall not be construed to
waive or render unnecessary Landlord's consent or approval to or of any
subsequent similar act by Tenant. Landlord's failure to prepare any of the bills
for Impositions or any other bills or statements shall not in any way cause
Landlord to forfeit or surrender its rights to collect any of such items of
additional
40
rent that may have become due during the Term; which right shall survive the
termination of this Lease.
30.2 This Lease (together with the Development Agreement) contains the
entire agreement of the parties with respect to the subject hereof, and no oral
statement or prior written matter (other than the terms of the Development
Agreement) shall have any force of effect. No waiver of any provision of this
instrument shall be effective unless in writing, signed by the waiving party.
Tenant agrees that it is not relying on any representations or agreements other
than those contained in this Lease and the Development Agreement. This Lease
shall not be modified except by a writing subscribed by Landlord and Tenant, nor
canceled by Tenant except with the written consent of Landlord, unless otherwise
specifically provided herein.
30.3 If any provision of this Lease shall be invalid or unenforceable in
whole or in part, the remainder of this Lease shall not be affected thereby and
each and every provision of this Lease shall be enforceable to the fullest
extent permitted by Laws and Ordinances. This Lease shall be interpreted in
accordance with and be governed by the Laws and Ordinances of the State of New
York.
30.4 Tenant waives any and all rights of redemption conferred by statute
or otherwise, to the maximum extent permitted by Laws and Ordinances, upon the
expiration or sooner termination of the Term, or upon the entry of final
unappealable judgment for recovery of possession through any action or
proceeding.
30.5 Wherever herein the singular number is used, the same shall include
the plural, and the masculine gender shall include the feminine and neuter
genders. The paragraph headings used herein are for reference and convenience
only, and shall not enter into the interpretation of this Lease. The words
"reenter" and "reentry" as used herein are not restricted to their technical
legal meaning.
30.6 Nothing in this Lease shall cause Landlord in any way to be construed
as a partner, joint venturer, or an associate of Tenant in the operation of the
Demised Premises.
ARTICLE 31
NON-BINDING EFFECT
------------------
31.1 This Lease is transmitted for examination only and does not
constitute an offer to lease, and, subject to the provisions of Section 2.7
above, this Lease shall become effective only upon execution and unconditional
delivery thereof by both parties hereto.
41
ARTICLE 32
REPRESENTATIONS AND COVENANTS
-----------------------------
32.1 The execution and delivery of this Lease by either of the parties
hereto shall be deemed to be a representation that this Lease has been duly
authorized and the party executing the same has the proper authority. Each party
shall supply the other reasonable evidence of such proper authorization.
32.2 Tenant agrees to cooperate with Landlord and, at Landlord's sole cost
and expense supply all necessary materials and testimony, including, but not
limited to, expert witnesses, which may be required in order to obtain the
necessary approvals (such as final site plan) for Tenant's Specific Uses of the
Demised Premises.
ARTICLE 33
OPTION TO RENEW
---------------
33.1 Tenant shall have an option to extend the Initial Term for a period
of five (5) years (hereinafter referred to as the "First Extended Term"), upon
the following terms and conditions: (a) said option shall be exercised by
written notice to Landlord given no later than twelve (12) months prior to the
expiration of the Initial Term; (b) there shall not be any uncured defaults (of
which notice has been given to Tenant and with respect to which the applicable
cure periods have expired) by Tenant hereunder at the time of the exercise of
said option or the commencement of the First Extended Term; (c) upon such First
Extended Term taking effect, this Lease shall continue for such additional
period of five (5) years
All of the terms, covenants and conditions of this Lease shall continue in
force and effect during the First Extended Term, except that the Fixed Minimum
Rent shall be at the rates set forth on Exhibit E attached hereto and made a
part hereof.
33.2 Provided Tenant shall have exercised the option for the First
Extended Term, Tenant shall have an additional option to extend the Term for a
period of five (5) years, (hereinafter referred to as the "Second Extended
Term") upon the following terms and conditions: (a) said option shall be
exercised by written notice to Landlord given no later than twelve (12) months
prior to the expiration of the First Extended Term; (b) there shall not be any
uncured defaults (of which notice has been given to Tenant and with respect to
which the applicable cure periods have expired) by Tenant hereunder at the time
of the exercise of said option or the commencement of the Second Extended Term;
and (c) upon such Second Extended Term taking effect, this Lease shall continue
for such additional period of five (5) years.
42
All of the terms, covenants and conditions of this Lease shall continue in
force and effect during the Second Extended Term, except that the Fixed Minimum
Rent shall be at the rates set forth on Exhibit E attached hereto and made a
part hereof.
33.3 Provided Tenant shall have exercised the options for the First
Extended Term and the Second Extended Term, Tenant shall have an additional
option to extend the Term for a period of five (5) years (hereinafter referred
to as the "Third Extended Term") upon the following terms and conditions: (a)
said option shall be exercised by written notice to Landlord given no later than
twelve (12) months prior to the expiration of the Second Extended Term; (b)
there shall not be any uncured defaults (of which notice has been given to
Tenant and with respect to which the applicable cure periods have expired) by
Tenant hereunder at the time of the exercise of said option or the commencement
of the Third Extended Term; (c) upon such Third Extended Term taking effect,
this Lease shall continue for such additional period of five (5) years; and (d)
there shall be no further right to extend the Term.
All of the terms, covenants and conditions of this Lease shall continue in
force and effect during the First Extended Term, except that the Fixed Minimum
Rent shall be at the rates set forth on Exhibit E attached hereto and made a
part hereof.
33.4 In the event Tenant exercises one or more of the options granted
herein, the word "Term" shall include such option period(s); the period of time
referred to in Section 2.1 of this Lease is sometimes referred to as the
"Initial Term", and each or all, as the case may be, of the option periods are
sometimes referred to as the "Extended Term".
IN WITNESS WHEREOF, the parties hereto have hereunto set their hands and
seals the day and year first above written.
/s/ Harold Lepler
--------------------------------
HAROLD LEPLER(Landlord)
SCHEIN PHARMACEUTICAL, INC. (Tenant)
By: [SIGNATURE APPEARS HERE], VP - OPERATIONS
---------------------------------------------
43
EXHIBITS
--------
Exhibit A - Description of Land
Exhibit B - Plot Plan
Exhibit C - Permitted Encumbrances
Exhibit D - Commencement Date Certificate
Exhibit E - Rent Schedule
Exhibit F - Non-Disturbance Agreement
44
[MAP APPEARS HERE]
SURVEY OF PROPERTY
OF
SECTION ONE
MT. EBO CORPORATE CENTER
PREPARED PER
ROBERT ARNOW
SITUATED IN
TOWN OF SOUTHEAST, PUTNAM CO. NY
MARCH 17, 1992
Exhibit A
Terry Bergendorff Collins
Professional Land Surveyor
Mt. Ebo Corporate Park
Putnam Lake Road
BREWSTER, NEW YORK 10509
(914) 279-4261 FAX (914) 279-6838
Mt. Ebo Corporate Center
Site 2A - 11.421 Acres
March 19, 1992
All that certain plot, piece or parcel of land situate, lying and
being in the Town of Southeast, County of Putnam and State of New York being a
portion of Site 2 as shown on a filed map entitled "Section One of Mt. Ebo
Corporate Center" filed in the Putnam County Clerk's Office September 13, 1982
as filed map no. 1888 and being more particularly described as follows:
Beginning at the northeasterly corner of the parcel herein described which point
is distant on a curve to the right having a radius of 50.00, a central angle of
103-57-33 and a length of 90.72, S 0-41-52 E 126.51, S 7-00-00 W 391.19 and on a
curve to the left having a radius of 600.00, a central angle of 13-36-03
and a length of 142.43 from the intersection of the southerly side of Putnam
Lake Road and the westerly side of Road "A" as shown on the aforementioned
filed map no. 1888; thence from said point of beginning through lands of Site 2
as shown on said filed map no. 1888 on a curve to the left having a radius of
600.00, a central angle of 7-11-08 and a length of 75.25 to a point: thence S
13-47-11 E 455.96 to a point on a curve to the right: thence along said curve to
the right having a radius of 275.00, a central angle of 44-14-06 and a length of
212.31 to a point: thence still through lands of Site 2 S 30-26-55 W 102.78 to
the southeasterly corner of the parcel herein described and the northerly line
of lands now or formerly Hipotronics: thence along the northerly line of
lands now or formerly Hipotronics and along the mean centerline of a stonewall N
4-10-20 W 28.35, S 87-03-00 W 91.38 and S 80-53-00 W 338.51 to lands now or
formerly Presbyterian Church; thence, along lands now or formerly Presbyterian
Church and continuing along the mean centerline of a stonewall N 1-09-00 W
52.13, N 14-17-00 W 35.79, N 85-03-00 W 90.86, N 77-52-00 W 137.07, N 62-08-00 W
91.06 and N 62-08-00 W 30.40 to the centerline of Old Route 22: thence along the
centerline of Old Route 22 N 3-10-47 W 335.93 to the easterly side of New York
State Route 22; thence along the easterly side of New York State Route 22 N
9-30-12 E 21.68 to a point: thence partly along lands now or formerly Brewster
Properties N 86-58-00 E 222.24 and N 3-02-00 W 100.00 to a point on the
southerly boundary of Site 3 as shown on the aforementioned filed map no. 1888;
thence along the southerly boundary of said Site 3 N 86-57-33 E 201.47 and N 61-
00-00 E 373.52 to the point and place of beginning. Containing within said
bounds 11.421 acres more or less.
EXHIBIT C
none
EXHIBIT D
COMMENCEMENT DATE CERTIFICATE AND AGREEMENT
-------------------------------------------
THIS COMMENCEMENT DATE CERTIFICATE AND AGREEMENT, dated the day
---
of, 199 , is by a [general/limited] partnership organized
- ---------------------
and existing under the laws of the State of New York, having an office in care
of Covington Management Company (Attn: Harold Lepler) at Millbrooke Office
Centre, Route 22 and Milltown Road, Brewster, New York 10509 ("Landlord")
WITNESSETH:
WHEREAS Landlord and Schein Pharmaceutical, Inc. ("Tenant") have
entered into that certain Agreement dated as of , 1992 (the
----------
"Development Agreement") whereby Landlord agreed, inter alia, to construct the
----- ----
Building pursuant to the terms thereof;
WHEREAS, upon satisfaction of certain Conditions described in the
Development Agreement, Tenant agreed to lease the Demised Premises from
Landlord, and Landlord agreed to lease the Demised Premises to Tenant pursuant
to the terms of that certain Lease dated as of the day of , 1992 (the
-- ------
"Lease"); and
WHEREAS, the Lease provides that the Commencement Date of the Lease
shall not occur until, inter alia, Landlord shall have delivered this
----- ----
Commencement Date Certificate and Agreement to Tenant.
NOW THEREFORE, for valuable consideration, the receipt and sufficiency
of which is hereby acknowledged, and as an inducement to Tenant to commence the
performance of its obligations under the Lease, Landlord hereby represents,
warrants and agrees that:
1. The Demised Premises, and the use thereof permitted under the
Lease, complies with all Laws and Ordinances and all requirements of the
Insurance Companies and Boards.
2. The certificate of occupancy issued for the Building (the
"Certificate of Occupancy") bears number , is dated , and
---------- -------------
has not been modified by the relevant municipal authorities. The Certificate of
Occupancy is in effect as of the date hereof and does not prohibit the use of
the Demised Premises for the purposes permitted under the Lease.
3. The Building and Land currently comply with all Laws and
Ordinances, fire insurance regulations and floor load restrictions.
4. The Land, the Building and the Demised Premises are in compliance
with all applicable Laws and Ordinances relating to Hazardous Materials and the
Land and the Building do not contain Hazardous Materials.
2
5. Except for the Permitted Encumbrances, there are no easements,
restrictions or other exceptions to title affecting the Demised Premises.
6. There are no common area maintenance or similar charges relating
to the Park payable with respect to the Demised Premises except
.
- -------------------------------
7. Landlord hereby agrees to indemnify, defend and hold Tenant
harmless with respect to any and all loss, liability, damages, costs and
expenses (including reasonable legal fees) which may be incurred by Tenant
arising out of or in connection with any breach by Landlord of the
representations and warranties set forth in this Certificate and Agreement.
Any capitalized terms used herein and not otherwise herein defined
shall be given the meanings ascribed to such terms in the Lease.
IN WITNESS WHEREOF, the undersigned has caused this Commencement Date
Certificate and Agreement to be executed as of the date set forth above.
-------------------------------
(Landlord)
By:
----------------------------
3
EXHIBIT E
---------
The Fixed Minimum Rent to be paid by Tenant pursuant to the provisions
of this Lease for the first year of the Term shall be computed based upon an
annual rate of $7.945 per square foot of space in the Building (adjusted in
accordance with the provisions of Section 6.02 of the Development Agreement),
and shall be increased for each subsequent year of the Term (including each year
of each Extended Term elected by Tenant) by 2.15% of the Fixed Minimum Rent
payable for the preceding lease year.
EXHIBIT F
NON-DISTURBANCE AND ATTORNMENT AGREEMENT
----------------------------------------
THIS AGREEMENT, made this day of l99 , by and among
---- ---------- -
SCHEIN PHARMACEUTICAL, INC., a New York Corporation, having an office at
(hereinafter referred
- --------------------------------------------------------
to as "Tenant"), and , a , having its
----------------------------- ----------
principal place of business at
----------------------------------------
(hereinafter referred to as "Mortgagee").
WITNESSETH:
----------
WHEREAS, Harold Lepler, as landlord ("Landlord") entered into a
certain Lease with Tenant dated as of , 1992 (the "Lease"), relating
-----------
to a warehouse and office facility located in the Mt. Ebo Office Park in the
Town of Southeast, County of Putnam, State of New York (the "Demised Premises");
and
WHEREAS, Landlord is about to execute a first Mortgage to Mortgagee
dated of even date herewith (the "Mortgage") securing a loan in the amount of
($ ), and Mortgagee has
- -------------------------------------- -------------
refused to make said loan unless it is secured by a mortgage prior in right and
interest to the Lease and the interests of Tenant under the Lease; and
WHEREAS, Tenant has agreed that the Lease shall be subject and
subordinate to mortgages affecting the Demised
Premises provided that the mortgagee thereunder delivers to Tenant an agreement
in the form of this Agreement.
NOW, THEREFORE, in consideration of the Premises and ONE DOLLAR
($1.00) paid to Tenant, the receipt and sufficiency of which are hereby
acknowledged and intending to be legally bound, Tenant and Mortgagee covenant
and agree as follows:
1. Mortgagee agrees that, for as long as Tenant is not in default
beyond any applicable notice and/or grace period under any of the terms,
covenants or conditions of the Lease, if any action or proceeding is commenced
by Mortgagee for the foreclosure of the Mortgage, Tenant shall not be named as a
party therein, and the right of possession of Tenant to the Demised Premises
shall not be affected or disturbed, and upon the sale of the Demised Premises in
any such action or proceeding, the Mortgagee or other purchaser of the premises
shall accept the attornment of Tenant and recognize the rights of Tenant under
the Lease.
2. In the event that Mortgagee or such other purchaser shall succeed
to the interests of Landlord under the Lease as aforesaid, Tenant agrees to
attorn to and accept Mortgagee or such other purchaser as its landlord under the
Lease for the balance of the term thereof and Mortgagee or such other purchaser
shall be bound to Tenant under all the terms, covenants and conditions of the
Lease and Tenant shall, from and after such event, have the same remedies
against Mortgagee or such other
2
purchaser for the breach of an agreement contained in the Lease that Tenant
might have had under the Lease against Landlord if Mortgagee or such other
purchaser had not succeeded to the interest of Landlord; provided, however, that
Mortgagee or such other purchaser shall not be:
(i) bound by any payment of rent or additional rent made by
Tenant for more than one month in advance;
(ii) bound by any amendment or modification of the Lease, dated
subsequent to this Agreement, made without the consent of Mortgagee;
(iii) liable for any previous act or omission of any prior
landlord, including Landlord, under the Lease; or
(iv) subject to any offset or counterclaim or defense which shall
theretofore have accrued to Tenant against any prior landlord, including
Landlord, under the Lease.
3. Tenant agrees to give prompt written notice to Mortgagee of any
default of Landlord in the obligations of Landlord under the Lease, if such
default is of such nature as to give Tenant a right to terminate the Lease,
reduce rent or to credit or offset any amounts against future rents. It is
further agreed that such notice will be given to any successor in interest of
Mortgagee in said Mortgage provided that prior to any such default of Landlord
such successor in interest shall have given written notice to Tenant of its
acquisition of Mortgagee's
3
interest therein, and designated the address to which such notice is to be
directed. Tenant further agrees that notwithstanding any provision of the Lease
to the contrary, no notice of cancellation thereof shall be effective unless
Mortgagee, or such successor in interest, has received such notice of default
within thirty (30) days of the date thereof (or if the default cannot be cured
within thirty (30) days in the exercise of reasonable diligence, has had the
opportunity to commence the cure thereof within said thirty (30) day period) and
thereafter completes the cure with reasonable diligence.
4. All notices and other communications provided for or contemplated
by this Agreement shall be in writing and shall be delivered by hand or
commercial courier guaranting overnight delivery, or mailed by registered or
certified mail, postage prepaid, return receipt requested1 addressed as follows:
If to the Tenant, in all cases to it at:
-------------------------------
-------------------------------
-------------------------------
-------------------------------
Attention:
---------------------
If to Mortgagee, in all cases to it at:
-------------------------------
-------------------------------
4
-------------------------------
-------------------------------
Attention:
---------------------
All notices and other communications given to any party hereto in accordance
with the provisions of this Agreement shall be deemed to have been given on the
date of receipt if hand delivered or delivered by overnight courier, or five
days after posting if sent by registered or certified mail, postage prepaid,
return receipt requested, in each case addressed to such party as provided in
this Section. Each party hereto may change its address by providing express
notice of such change to the other in accordance with this Section.
5. The agreements herein contained shall bind and inure to the
benefit of the successors in interest of the parties hereto, and, without
limiting such, the agreement of Mortgagee shall specifically be binding upon any
purchaser of all or any portion of the Mortgagee's interest in the Mortgage, or
of the Demised Premises at a sale foreclosing the Mortgage, or of the Demised
Premises at a sale in lieu of such foreclosure.
5
IN WITNESS WHEREOF, the parties hereto have caused the execution
hereof as of the date first above written.
SCHEIN PHARMACEUTICAL, INC. (Tenant)
By:
---------------------------
Its:
------------------------------
By:
---------------------------
Its:
[NOTE: THIS FORM SHALL BE CONFORMED AS APPROPRIATE IN THE EVENT THAT IT IS
INTENDED TO APPLY TO AN OVERLEASE RATHER THAN A MORTGAGE]
6
MORTGAGEE
- ---------
STATE OF )
) ss.:
COUNTY OF )
On the _____ day of ___________________, 19__, before me personally
came , to me known, who, being by me duly sworn, did depose and say that he
resides at that he is the ___________________________ of __________________, the
corporation described in and which executed the foregoing instrument, and that
he signed his name thereto by order of the Board of Directors of said
corporation.
--------------------------------------
Notary Public
TENANT
- ------
STATE OF )
) ss.:
COUNTY OF )
On the ____ day of ______________, 19__ , before me personally came
_____________________________________________, to me known, who, being by me
duly sworn, did depose and say that he resides at _________________
_____________________________________________________________; that he is the
___________________________________ of ________________________________________
_______________________________, the corporation described in and which executed
the foregoing instrument, and that he signed his name thereto by order of the
Board of Directors of said corporation.
7