EXHIBIT 10.17
Execution
SUBLEASE AGREEMENT
BETWEEN
675 OWNERSHIP LLC
AND
BILL GROSS' IDEALAB!,
A CALIFORNIA CORPORATION
DATED: DECEMBER 23, 1999
PREMISES: 675 SIXTH AVENUE
NEW YORK, NEW YORK
LEASE: THE FIFTH FLOOR AND A PORTION OF THE BASEMENT
EXHIBITS: A - FIFTH FLOOR PLAN
B - LANDLORD'S WORK
C - CERTIFICATE OF OCCUPANCY
D - BASEMENT PLAN
E - FOURTH FLOOR PLAN
F - ADDITIONAL BASEMENT PLAN
TABLE OF CONTENTS
PAGE
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Article 1 Rent . . . . . . . . . . . . . . . . . .
Article 2 Commencement of Term . . . . . . . . . .
Article 3 Adjustments of Rent . . . . . . . . . .
Article 4 Electricity . . . . . . . . . . . . . .
Article 5 Use. . . . . . . . . . . . . . . . . . .
Article 6 Alterations and Installations. . . . . .
Article 7 Repairs. . . . . . . . . . . . . . . . .
Article 8 Requirements of Law. . . . . . . . . . .
Article 9 Insurance, Loss, Reimbursement,
Liability . . . . . . . . . . . . .
Article 10 Damage by Fire or Other Cause. . . . . .
Article 11 Assignment, Mortgaging, Subletting,
Etc. . . . . . . . . . . . . . . .
Article 12 Certificate of Occupancy . . . . . . . .
Article 13 Adjacent Excavation - Shoring . . . . .
Article 14 Condemnation . . . . . . . . . . . . . .
Article 15 Access to Demised Premises; Changes . .
Article 16 Conditions of Limitation . . . . . . . .
Article 17 Re-entry by Landlord, Injunction . . . .
Article 18 Damages. . . . . . . . . . . . . . . . .
Article 19 Landlord's Right to Perform Tenant's
Obligations . . . . . . . . . . . .
Article 20 Quiet Enjoyment. . . . . . . . . . . . .
Article 21 Services and Equipment . . . . . . . . .
Article 22 Definitions. . . . . . . . . . . . . . .
Article 23 Invalidity of any Provision. . . . . . .
Article 24 Brokerage. . . . . . . . . . . . . . . .
Article 25 Subordination. . . . . . . . . . . . . .
Article 26 Certificate of Tenant. . . . . . . . . .
Article 27 Legal Proceedings, Waiver of Jury Trial.
Article 28 Surrender of Premises. . . . . . . . . .
Article 29 Rules and Regulations. . . . . . . . . .
Article 30 Consents and Approvals . . . . . . . . .
Article 31 Notices. . . . . . . . . . . . . . . . .
Article 32 No Waiver. . . . . . . . . . . . . . . .
Article 33 Captions . . . . . . . . . . . . . . . .
Article 34 Inability to Perform . . . . . . . . . .
Article 35 No Representations . . . . . . . . . . .
Article 36 Intentionally Omitted. . . . . . . . . .
Article 37 Arbitration. . . . . . . . . . . . . . .
Article 38 Indemnity. . . . . . . . . . . . . . . .
Article 39 Memorandum of Lease. . . . . . . . . . .
Article 40 Signs . . . . . . . . . . . . . . . . .
Article 41 Additional Space . . . . . . . . . . . .
Article 42 Renewal Option . . . . . . . . . . . . .
Article 43 Intentionally Omitted. . . . . . . . . .
Article 44 Miscellaneous. . . . . . . . . . . . . .
SUBLEASE AGREEMENT made as of this 23 day of December, 1999, between 675
Ownership LLC, having an office at 675 Avenue of the Americas, New York, New
York 10010 (hereinafter referred to as "Landlord") and Bill Gross' idealab!, a
California Corporation, having an office at 130 West Union Street, Pasadena
California 91103 (hereinafter referred to as "Tenant").
WITNESSETH:
WHEREAS, by lease dated August 29, 1984 (hereinafter called the "Over
Lease"), AVEMER ASSOCIATES (hereinafter called "Over Landlord") leased to
Landlord's predecessor, the building (the "Building") and premises known as 675
Sixth Avenue, New York, New York (the "Premises") (a true and complete copy of
the "Over Lease", with certain deletions as to economic matters, has previously
been exhibited to Tenant); and
WHEREAS, Tenant desires to hire from Landlord and Landlord desires to
sublet to Tenant a portion of the Premises covered by the Over Lease;
Landlord hereby leases and Tenant hereby rents from Landlord the entire
fifth floor at the Building as shown on the plan annexed hereto as Exhibit A
(the "demised premises"), for a term (the "Term") commencing on the
"Commencement Date" and ending on the "Expiration Date" (as said terms are
defined in Article 2 hereof) unless the Term shall sooner cease and terminate as
hereinafter provided, and Tenant hereby rents from Landlord (as of the date
specified in Article 41 hereof), a portion of the basement at the Building, in
accordance with Article 41 hereof.
The parties hereby covenant and agree as follows:
ARTICLE 1
RENT
1.01. A. Tenant agrees to pay to Landlord a fixed annual rent (the "fixed
annual rent") as follows:
YEAR FIXED ANNUAL RENT MONTHLY INSTALLMENT
- ---- ----------------- -------------------
April 1, 2000 to May 31, 2000 $ -0- $ -0-
June 1, 2000 to May 31, 2005 1,945,000 162,083
June 1, 2005 to May 31, 2010 2,150,000 179,167
June 1, 2010 to May 31, 2015 2,300,000 191,667
B. In lieu of operating expense escalations, the fixed annual rent
shall be increased, on June 1, 2001, by $48,125.00 ($4,010.00 per month), and on
each June 1 thereafter
during the Term, in addition to the regular "step-up increases" set forth in A.
above, by an amount equal to 2.5% of the fixed annual rent, as escalated by the
provision of this sentence, for the immediately preceding twelve month period.
For example, the fixed annual rent shall be increased on June 1, 2003, by 2.5%
of the fixed annual rent payable for the period June 1, 2002 to May 31, 2003, as
previously escalated by the provisions of this Section 1.01(B).
C. All monthly installments of fixed annual rent shall be paid in
advance on the first day of each calendar month during the Term, at the office
of Landlord or such other place as Landlord may designate, without any setoff or
deduction whatsoever, except such deductions as are specifically referred to in
Articles 10 and 14 hereof. The first full month's installment of fixed annual
rent (which shall be applied against the first payment of fixed annual rent)
shall be paid by Tenant to Landlord upon the execution of this Lease. The
payment of fixed annual rent shall commence on the Rent Commencement Date.
Should the Commencement Date fall on any day other than the first of a month,
then the fixed annual rent for such month shall be prorated on a per diem basis.
1.02. Tenant shall pay the fixed annual rent and all additional rent
payable hereunder in lawful money of the United States by check (subject to
collection) drawn to Landlord's order on a bank which is a member of the New
York Clearinghouse Association or a successor thereto. All sums, other than
fixed annual rent, payable by Tenant hereunder shall be deemed additional rent
and shall be payable on demand unless other payment dates are hereinafter
provided. Landlord shall have the same rights and remedies (including, without
limitation, the right to commence a summary proceeding) for a default in the
payment of additional rent as for a default in the payment of fixed annual rent
notwithstanding the fact that Tenant may not then also be in default in the
payment of fixed annual rent.
1.03. If Tenant shall fail to pay when due any installment of fixed annual
rent or any payment of additional rent for a period of seven days after such
installment or payment shall have become due, Tenant shall pay interest thereon
at the Interest Rate (as such term is defined in Article 22 hereof), from the
date when such installment or payment shall have become due to the date of the
payment thereof, and such interest shall be deemed additional rent. The
provisions of this Section 1.03 are in addition to all other remedies available
to Landlord for nonpayment of fixed annual rent or additional rent.
1.04. If any of the fixed annual rent or additional rent payable under this
Lease shall be or become uncollectible, reduced or required to be refunded
because of any Legal Requirement (as such term is defined in Article 22 hereof),
Tenant shall enter into such agreement(s) and take such other legally
permissible steps as Landlord may request to permit Landlord to collect the
maximum rents which from time to time during the continuance of such Legal
Requirement may be legally permissible and not in excess of the amounts reserved
therefor under this Lease. Upon the termination of such Legal Requirement, (a)
the rents hereunder shall be payable in the amounts reserved herein for the
periods following such termination and (b) Tenant shall pay to Landlord, to
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the maximum extent legally permissible, an amount equal to (i) the rents which
would have been paid pursuant to this Lease but for such Legal Requirement less
(ii) the rents paid by Tenant during the period such Legal Requirement was in
effect.
ARTICLE 2
COMMENCEMENT OF TERM
2.01. (a) The "Commencement Date" of the Term shall be the later of
(i)April 1, 2000; or (ii) the date on which Landlord delivers the demised
premises to Tenant vacant, broom clean, free of tenancies and with Landlord's
Work (as hereafter defined), substantially completed.
(b) The "Rent Commencement Date" shall be two months after the
Commencement Date.
(c) The "Expiration Date" of the Term shall be the day before the
15th anniversary of the Commencement Date.
For purposes of this Lease, a "lease year" shall mean each twelve month
period commencing on the Commencement Date and each anniversary thereof.
2.02. Landlord shall deliver the demised premises to Tenant on the
Commencement Date, vacant, broom clean and free of rights of tenants and
occupants. Landlord shall perform only the work set forth on EXHIBIT B annexed
hereto (hereinafter referred to as "Landlord's Work"). Except for the Landlord's
Work, Landlord shall not be required to perform any work or expend any services
to prepare the demised premises or the Building for Tenant's occupancy. All
other installations, materials and work which may be required by Tenant to
prepare, equip, decorate and furnish the demised premises for Tenant's occupancy
shall be done by Tenant at Tenant's expense and are hereinafter called "Tenant's
Extra Work". All Tenant's Extra Work shall be subject to, and conform with, the
provisions of this Lease, including, but not limited to, Article 6. Landlord
shall reimburse Tenant for the cost of certain of Tenant's Extra Work, as set
forth in Section 6.09.
ARTICLE 3
ADJUSTMENTS OF RENT
3.01. A. For purposes hereof, the following definitions shall apply:
(a) The term "Base Tax" shall mean the Taxes actually payable with
respect to the Premises for the July 1, 2000 through June 30, 2001 Tax Year.
Landlord represents
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that there are no tax abatements currently in effect which affect the Base Tax.
(b) The term "Tax Year" shall mean each period of twelve months
which includes any part of the Term which now or hereafter is or may be duly
adopted as the fiscal year for real estate tax purposes of the City of New York.
(c) The term "Taxes" shall mean (i) all real estate taxes,
assessments, governmental levies, municipal taxes, county taxes, business
improvement district, or any other governmental charge, general or special,
ordinary or extraordinary, unforeseen as well as foreseen, of any kind or nature
whatsoever, which are or may be assessed, levied or imposed upon all or any part
of the Premises and the sidewalks, plazas or streets adjacent thereto, including
any tax, excise or fee measured by or payable with respect to any rent, and
levied against Landlord and/or the Premises under the laws of the United States,
the City or State of New York, or any political subdivision thereof, and (ii)
any reasonable expenses incurred by Landlord, including payments to attorneys
and appraisers, in contesting any of the items set forth in clause (i) of this
sentence, or the assessed valuations of all or any part of the Premises. If due
to a future change in the method of taxation or in the taxing authority, a new
or additional real estate tax, or a franchise, income, transit, profit or other
tax or governmental imposition, however designated, shall be levied against
Landlord and/or the Premises, in addition to and similar to the types of taxes
included in Taxes, or in substitution in whole or in part for any tax which
would constitute "Taxes", or in lieu of additional Taxes, such tax or imposition
shall be deemed for the purposes hereof to be included within the term "Taxes".
"Taxes" shall not include income, franchise, inheritance, estate, succession,
profit, revenue, gains, gift, mortgage, capital levy, transfer or similar such
taxes imposed upon Landlord.
(d) The term "Tenant's Tax Share" shall mean 16.66%. (Tenant
occupies one of the six floors in the Building, with no allocation for the
basement space).
(e) The term "Escalation Statement" shall mean a statement setting
forth the amount payable by Tenant for a specified Tax Year or calendar year, as
the case may be, or for some portion thereof pursuant to this Article 3, which
shall be accompanied with a copy of the most recent available tax bill(s) from
the applicable municipal authority.
B. Tenant shall pay to Landlord as additional rent for each Tax Year
a sum equal to Tenant's Tax Share of the amount by which the Taxes for such Tax
Year exceed the Base Tax (hereinafter referred to as "Tenant's Tax Payment").
Landlord shall furnish to Tenant an annual Escalation Statement (subject to
revision as hereinafter provided) for each Tax Year setting forth Tenant's Tax
Payment for such Tax Year. Tenant's Tax Payment shall be due and payable as
follows: two semi-annual installments, in advance, on the first day of each June
and December of each calendar year. If an annual Escalation Statement is
furnished to Tenant after the commencement of the Tax Year to which it relates,
then (a) until such Escalation Statement is rendered, Tenant shall pay Tenant's
Tax Payment for such Tax Year in installments based upon the
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last Escalation Statement rendered to Tenant with respect to Taxes and (b)
Tenant shall, within 10 days after such annual Escalation Statement is furnished
to Tenant, pay to Landlord an amount equal to any underpayment of the
installments of Tenant's Tax Payment theretofore paid by Tenant for such Tax
Year and, in the event of an overpayment by Tenant, Landlord shall permit Tenant
to credit against subsequent payments under this Section 3.01 the amount of such
overpayment. If this Lease shall have theretofore expired, Landlord shall make
such payment directly to Tenant. If there shall be any increase in Taxes for any
Tax Year, whether during or after such Tax Year, Landlord shall furnish a
revised Escalation Statement for such Tax Year to Tenant, and Tenant's Tax
Payment for such Tax Year shall be adjusted and paid in the same manner as
provided in the preceding sentence. If during the Term, Taxes are required to be
paid (either to the appropriate taxing authorities or as tax escrow payments to
a superior mortgagee or to the Over Landlord) in full or in monthly, quarterly,
or other installments, on any other date or dates than as presently required,
then at Landlord's option, Tenant's Tax Payments shall be correspondingly
accelerated or revised so that said Tenant's Tax Payments are due at least 30
days prior to the date payments are due to the taxing authorities or the
superior mortgagee or Over Landlord. The benefit of any discount for any early
payment or prepayment of Taxes shall accrue solely to the benefit of Landlord
and such discount shall not be subtracted from Taxes.
C. If Landlord shall receive a refund of Taxes for any Tax Year,
Landlord shall permit Tenant to credit against subsequent payments under this
Section 3.01, Tenant's Tax Share of the refund, but not in excess of Tenant's
Tax Payment paid for such Tax Year. If the Term has expired, Landlord will
promptly make such payment to Tenant directly.
3.02. INTENTIONALLY OMITTED.
3.03. Tenant shall pay to Landlord upon demand, as additional rent, any
occupancy tax or rent tax hereafter in effect, which Landlord is required to pay
with respect to the demised premises or this Lease, unless such tax is
specifically excluded from Taxes pursuant to the last sentence of Section
3.01(c).
3.04. If the Commencement Date shall be other than the first day of a Tax
Year or if the date of the expiration or other termination of this Lease shall
be a day other than the last day of a Tax Year, then Tenant's Tax Payment for
such partial year shall be equitably adjusted taking into consideration the
portion of such Tax Year falling within the Term. Landlord shall, as soon as
reasonably practicable, cause an Escalation Statement with respect to Taxes for
the Tax Year in which the Term expires to be prepared and furnished to Tenant.
3.05. In no event shall the fixed annual rent ever be reduced by operation
of this Article 3. The rights and obligations of Landlord and Tenant under the
provisions of this Article 3 shall survive the termination of this Lease, and
payments shall be made pursuant to this Article 3 notwithstanding the fact that
an Escalation Statement is furnished to Tenant after the expiration or other
termination of the Term.
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3.06. Landlord's failure to render an Escalation Statement with respect to
any Tax Year or Lease Year shall not prejudice Landlord's right to thereafter
render an Escalation Statement with respect thereto or with respect to any
subsequent Tax Year or Lease Year.
3.07. Each Escalation Statement shall be conclusive and binding upon Tenant
unless within 20 days after receipt of such Escalation Statement Tenant shall
notify Landlord that it disputes the correctness of such Escalation Statement,
specifying the particular respects in which such Escalation Statement is claimed
to be incorrect. Any dispute relating to any Escalation Statement, not resolved
within 45 days after the giving of such notice by Tenant, may be submitted to
arbitration by either party pursuant to Article 37 hereof. Pending the
determination of such dispute, Tenant shall pay additional rent in accordance
with the Escalation Statement that Tenant is disputing, without prejudice to
Tenant's position.
ARTICLE 4
ELECTRICITY
4.01. For the period commencing on the Commencement Date, Tenant covenants
and agrees to pay directly to the utility company supplying electric current for
the demised premises the amounts due for such electric current consumed,
including by use of the hvac system serving the demised premises, as indicated
by meter(s) measuring Tenant's consumption thereof. As of the Rent Commencement
Date, meters measuring only the electrical consumption utilized on the fifth
floor shall be installed at the Building and the demised premises shall be
serviced with electrical energy.
4.02. Any additional risers, feeders or other equipment or service proper
or necessary to supply Tenant's electrical requirements, upon written request of
Tenant, may be installed by Tenant at the sole cost and expense of Tenant, if in
Landlord's sole and reasonable judgment the same are necessary and will not
cause permanent damage or injury to the Premises or the demised premises or
cause or create a dangerous or hazardous condition or entail excessive or
unreasonable alterations, repairs or expense or interfere with or disturb other
tenants or occupants.
4.03. Intentionally Omitted.
4.04. Tenant's use of electric current in the demised premises shall not at
any time exceed the capacity of any of the electrical conductors and equipment
in or otherwise serving the demised premises which capacity shall satisfy the
provisions of Section 4.08 hereof. Tenant shall not make or perform or permit
the making or performing of, any alterations to wiring, installations or other
electrical facilities serving the demised premises (to the extent same are
outside of the demised premises) without the prior consent of Landlord in each
instance. Should Landlord grant any such
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consent, all additional risers or other equipment required therefor shall be
installed by Tenant and the cost thereof shall be paid by Tenant.
4.05. Landlord shall not be liable in any way to Tenant for any failure or
defect in the supply or character of electric energy furnished to the demised
premises by reason of any requirement, act or omission of the public utility
providing the Premises with electricity or for any other reason whatsoever.
4.06. Tenant covenants and agrees that at no time will the connected
electrical load in the demised premises exceed 8 watts per usable square foot
(excluding hvac), unless otherwise specifically consented to by Landlord.
4.07 Landlord shall make available for exclusive use by Tenant, without
charge, up to 20% of available space for riser installations. All such
installations shall be performed at Tenant's sole cost and expense and otherwise
in accordance with this Lease.
ARTICLE 5
USE
5.01. The demised premises shall be used as and for executive,
administrative and general offices and uses reasonably ancillary to and
incidental to the foregoing, including a kitchen for the service of food only to
Tenant's employees and guests, and for no other purpose except as aforesaid.
5.02. Tenant shall not use or permit the use of the demised premises or any
part thereof in any way which would violate any of the covenants, agreements,
terms, provisions and conditions of this Lease or of the Over Lease or for any
unlawful purposes or in any unlawful manner or in violation of the Certificate
of Occupancy for the demised premises of the Building; and Tenant shall not
permit the demised premises or any part thereof to be used in any manner or
anything to be done, brought into or kept therein which, in Landlord's
reasonable judgment shall, or tend to, impair or interfere with (because of
noise level, traffic or other-wise) (i) the character, reputation or appearance
of the Building as a high quality office building, (ii) any of the Building
services or the proper and economic heating, cleaning, air conditioning or other
servicing of the Building or the demised premises, or (iii) the use of any of
the other areas of the Building by, or occasion discomfort, inconvenience or
annoyance to, any of the other tenants or occupants of the Building. Tenant
shall not install any electrical or other equipment of any kind which, in the
reasonable judgment of Landlord, might cause any such impairment, interference,
discomfort, inconvenience or annoyance or which might overload the risers or
feeders servicing the demised premises or other portions of the Building.
Landlord shall have the right to require Tenant, at Tenant's expense and to the
satisfaction of Landlord, to insulate the demised premises to reduce any noise
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generated therein, and to install curtains or blinds on the inside of windows in
the demised premises facing the atrium of the Building.
5.03 A. Tenant shall not use, play or operate or permit to be used, played
or operated any sound making or sound producing device in the demised premises
except in such manner and under such conditions as shall prevent any noise from
emanating from the demised premises to other areas in the Building or to street
areas outside of the Building;
B. Tenant agrees to prevent waste matter or refuse to accumulate in or
about the demised premises and shall keep same in a clean and orderly fashion.
Tenant shall arrange for the removal from the demised premises and the Building
of all of its refuse and rubbish, at Tenant's sole cost and expense.
C. Tenant shall not suffer or permit any occupancy or use thereof for
any purpose which shall be unlawful, obscene or pornographic.
ARTICLE 6
ALTERATIONS AND INSTALLATIONS
6.01. Except as set forth in item 8 below, Tenant shall make no
alterations, installations, additions or improvements in or to the demised
premises without Landlord's prior written consent and then only by contractors
or mechanics first approved by Landlord. All such work, alterations,
installations, additions and improvements shall be done at Tenant's sole expense
and at such times and in such manner as Landlord may from time to time
reasonably designate, so as to minimize interference with the rest of the
Building and its tenants.
Tenant's Extra Work and any future work in the demised premises shall be
done solely in accordance with plans and specifications first approved in
writing by Landlord, and by the Over Landlord if such consent is required under
the provisions of the Over Lease. Landlord will respond to requests for its
approval of such plans and specifications within 15 days of Landlord's receipt
thereof. Tenant shall reimburse Landlord promptly upon demand for any reasonable
costs and expenses incurred by Landlord in connection with Landlord's review of
such Tenant's plans and specifications. Landlord will not unreasonably withhold
or delay its consent to requests for such alterations, additions and
improvements.
Any such approved alterations and improvements shall be performed in
accordance with the foregoing and the following provisions of this Article 6:
1. All work shall be done in a good and workmanlike manner.
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2. (a) Any contractor employed by Tenant to perform any work
permitted by this Lease, and all of its subcontractors shall
agree to employ only such labor as will not result in
jurisdictional disputes or strikes or cause disharmony with other
workers employed at the Building. Tenant will inform Landlord in
writing of the names of any contractors or subcontractors Tenant
proposes to use in the demised premises at least thirty (30) days
prior to the beginning of work by such contractors or
subcontractors, and Landlord shall not unreasonably withhold or
delay its consent to such contractors or subcontractors.
(b) Tenant covenants and agrees to pay to the contractor, as the
work progresses, the entire cost of supplying the materials and
performing the work shown on Tenant's approved plans and
specifications, unless Tenant has a good faith basis for not
making such payment, and further provided that Tenant nonetheless
remains in compliance with the provisions of Section 6.02.
3. All such alterations shall be performed in compliance with all
Legal Requirements (as defined in Article 22 hereof) including,
without limitation, those imposed by the New York City Building
Department, the New York City Fire Department and O.S.H.A.
4. Tenant shall keep the Building and the demised premises free and
clear of all liens for any work or material claimed to have been
furnished to Tenant or to the demised premises on Tenant's
behalf, and all work to be performed by Tenant shall be done in a
manner which will not unreasonably interfere with or disturb
other tenants or occupants of the Building.
5. During the progress of the work to be done by Tenant, said work
shall be subject to inspection by representatives of Landlord who
shall be permitted access and the opportunity to inspect, at all
reasonable times, but this provision shall not in any way
whatsoever create any obligation on Landlord to conduct such an
inspection.
6. Prior to commencement of any work, Tenant shall furnish to
Landlord certificates evidencing the existence of:
(a) worker's compensation insurance covering all persons employed
for such work with statutorily required limits; and
(b) Employer's liability coverage including bodily injury caused
by disease with limits of not less than $100,000 per employee;
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(c) Comprehensive general liability insurance including but not
limited to completed operations coverage, products liability
coverage, contractual coverage, broad form property damage,
independent contractor's coverage and personal injury coverage
naming (i) Landlord and Over Landlord, as well as such
representatives and consultants of them as Landlord shall
reasonably specify (collectively "Landlord's Consultants"), as
well as Tenant, as additional insureds, with coverage of not less
than $5,000,000 combined single limit coverage (or such higher
limits as Landlord may from time to time impose in its reasonable
judgment);
(d) To the extent commercially available at commercially
reasonable rates, Tenant shall require all contractors engaged or
employed by the Tenant to indemnify and hold Tenant, Over
Landlord, Landlord, and Landlord's Consultants harmless in
accordance with the following clauses:
"The contractor hereby agrees to the fullest extent permitted by
law to assume the entire responsibility and liability for and
defense of and to pay and indemnify Landlord, Over Landlord,
Tenant, and Landlord's Consultants against any loss, cost,
expense, liability or damage and will hold each of them harmless
from and pay any loss, cost, expense, liability or damage
(including, without limitation, judgments, attorney's fees, court
costs, and the cost of appellate proceedings), which any and each
of them incur because of injury to or death of any person or on
account of damage to property, including loss of use thereof, or
any other claim arising out of, in connection with, or as a
consequence of the performance of the work by the contractor
and/or any acts or omissions of the contractor or any of its
officers, directors, employees, agents or sub-contractors or
anyone directly or indirectly employed by the contractor or
anyone for whose acts the contractor may be liable as it relates
to the scope of this Contract, whether such injuries to person or
damage to property are due or claimed to be due to any negligence
of the Landlord, Over Landlord, Landlord's Consultants, and/or
Tenant, its or their employees or agents or any other person."
The contractor's insurance shall specifically insure the
foregoing hold harmless provision verbatim.
(e) Such insurance shall be placed with solvent and responsible
companies reasonably satisfactory to the Landlord and licensed or
authorized to do business in the State of New York, with a
general policy holder's rating of not less than "A" and a
financial rating of not less than "Class X" as rated in the most
current available "Bests" Insurance Reports or such other
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comparable publication as may be acceptable to Landlord in the
event that "Bests" Insurance Reports ceases to publish such
information, and the policies shall provide that they may not be
cancelled without 30 days' prior written notice in writing to
Landlord.
7. Movement of all men and materials shall only be done at the
direction, the times and in the manner reasonably designated by
Landlord.
8. Subject to compliance with the Over Lease, no improvements
estimated to cost more than $100,000 in the aggregate in any
calendar year (as reasonably estimated by Landlord's architect or
engineer or general contractor) shall be undertaken (i) except
under the supervision of a licensed architect or licensed
professional engineer reasonably satisfactory to Landlord, (ii)
except after at least 30 days' prior written notice to Landlord
and receipt of Landlord's consent thereto as provided in this
Article 6, and (iii) prior to Tenant delivering to Landlord such
letters of credit or other security, if any, as is required under
the Over Lease. Notwithstanding the contrary, but subject to
compliance with the Over Lease, Tenant may perform non-structural
or non-building system work in the demised premises which are
estimated to cost less than $100,000, upon notice to, but without
the prior approval of or submission of plans to, Landlord.
9. Tenant shall deliver such performance bonds and completion bonds
and shall comply with such other provisions relating to
improvements and alterations, as shall be required under the
terms of the Over Lease as a condition to the commencement of
work on any improvements or alterations.
6.02. Notice is hereby given that Landlord shall not be liable for any
labor or materials furnished to or to be furnished to Tenant upon credit, and
that no mechanic's or other lien for any such labor or materials shall attach to
or affect the reversion or other estate or interest of Landlord or Over Landlord
in and to the demised premises. Any mechanic's lien filed against the demised
premises or the Building for work claimed to have been done for or materials
claimed to have been furnished to Tenant shall be discharged by Tenant at its
expense within fifteen (15) days after such filing, by payment, filing of the
bond required by law or otherwise. Failure to comply with the provisions of this
Section 6.02 shall constitute a material default by Tenant under this Lease
entitling Landlord to exercise any or all of the remedies provided in this Lease
in the event of Tenant's default.
6.03. All alterations, installations, additions and improvements made and
installed by Landlord at its expense, including without limitation all work
referred to in Article 2 hereof shall
11
be the property of Landlord and shall remain upon and be surrendered with the
demised premises as a part thereof at the end of the Term.
6.04. All Tenant's Extra Work and all alterations, installations, additions
and improvements made and installed by Tenant, or at Tenant's expense upon or in
the demised premises which are of a permanent nature and which cannot be removed
without damage to the demised premises or Building shall become the property of
the Landlord, and shall remain upon and be surrendered with the demised premises
as a part thereof at the end of the Term, except that Landlord shall have the
right at any time up to two months prior to the expiration of the Term to serve
notice upon Tenant that any such alterations, installations, additions and
improvements shall be removed and, in the event of service of such notice,
Tenant will, at Tenant's own cost and expense, remove the same in accordance
with and to the extent of such request, so as to render the demised premises
open and clear "slab to slab", including the repair and restoration of any
damage caused by the making of such alterations, installations, additions and
improvements and/or the removal thereof ("Building Standard"). Tenant shall not
be deemed to have surrendered the demised premises until such work has been
completed and until the provisions of Section 6.05 have been complied with,
whether by Tenant or by Landlord at Tenant's expense, and Tenant shall continue
to pay rent, after the expiration of the Term, at the then fair rental value for
the demised premises, and otherwise in accordance with the provisions of this
Lease until such completion and compliance and shall be liable for any
consequential damages incurred by Landlord as a result of any such holding over
after the expiration of the Term.
6.05. Where furnished by or at the expense of Tenant, all non-structural
furniture, furnishings and trade fixtures, including without limitation, murals,
machines and equipment, counters, screens, grille work, special panelled doors,
cages, partitions, metal railings, closets, panelling, free standing lighting
fixtures and equipment, drinking fountains, refrigeration and other food related
equipment and air handling equipment, and any other movable property shall
remain the property of Tenant which may at its option remove all or any part
thereof at any time prior to the expiration of the Term. In case Tenant shall
decide not to remove any part of such property, Tenant shall notify Landlord in
writing not less than six (6) months prior to the expiration of the Term,
specifying the items of property which it has decided not to remove. If, within
90 days after the service of such notice, Landlord shall request Tenant to
remove any of said property, Tenant shall at its expense, remove same. As to
such property which Landlord does not request Tenant to remove, the same shall
be, if left by Tenant, deemed abandoned by Tenant and thereupon the same shall
become the property of Landlord.
6.06. If any alterations, installations, additions, improvements or other
property which Tenant shall have the right to remove or be requested by Landlord
to remove as provided in Sections 6.04 and 6.05 hereof (herein in this Section
6.06 called the "property") are not removed on or prior to the expiration of the
Term, Landlord shall have the right to remove the property and to dispose of the
same without accountability to Tenant and at the sole cost and expense of
Tenant. In case of any damage to the demised premises or the Building resulting
from the removal by
12
Tenant of the property, Tenant shall repair such damage or, in default thereof,
shall reimburse Landlord for Landlord's cost in repairing such damage. This
obligation shall survive any termination of this Lease.
6.07. Subject to the provisions of this Article 6 Tenant shall, at its sole
cost and expense, redecorate the interior of the demised premises at least once
during the Term. For purposes hereof, the term "redecorate" shall mean only to
repaint or to wallpaper all interior walls in the demised premises and the
ceilings thereof, if appropriate, after having first prepared the surfaces
thereof by stripping off and priming them as appropriate. All redecoration work
shall be done with high-quality materials and where painting is involved, two
coats of paint shall be applied.
6.08. Tenant shall keep records of each of Tenant's alterations,
installations, additions and improvements costing in excess of $25,000, and of
the cost thereof. Tenant shall, within 30 days after demand by Landlord, furnish
to Landlord copies of such records if Landlord shall require same in connection
with any proceeding to reduce the assessed valuation of the Building, or in
connection with any proceeding instituted pursuant to Article 14 hereof.
6.09 Landlord shall reimburse Tenant for any cost in connection with
Tenant's Extra Work up to an amount equal to $500,000. Reimbursement by Landlord
to Tenant for Tenant's Extra Work shall be made in installments within thirty
(30) days of Tenant making a progress payment to Tenant's contractors (who
provide either "hard" or "soft" services), in accordance with the contract
documents between Tenant and such contractor, copies of which contract and
checks evidencing payment by Tenant shall have been furnished to Landlord, and
each such installment shall be in an amount equal to $500,000 multiplied by a
fraction, the numerator of which shall be the amount of Tenant's progress
payment with respect to which Tenant is being reimbursed and the denominator of
which shall be the total reasonably estimated completed cost of Tenant's Extra
Work. Alternatively, Tenant may require Landlord to pay Tenant's contractors
directly, upon presentation of invoices for work performed, but not more than
once per month. Landlord shall retain 10% of each such payment which retainage
shall be paid to Tenant only upon completion of Tenant's Extra Work in
accordance with the terms of this Lease and upon submission to Landlord of
documents reasonably satisfactory to Landlord evidencing that such Tenant's
Extra Work has been fully and properly completed, that all amounts due for
materials and labor have been paid in full and that all other conditions
reasonably imposed by Landlord as a condition to such payment have been
satisfied in full.
ARTICLE 7
REPAIRS
7.01. Tenant shall, at its sole cost and expense, make such repairs to the
demised premises and the fixtures and appurtenances therein as are necessitated
by the use, act, omission, occupancy or negligence of Tenant or by the use of
the demised premises in a manner contrary to the
13
purposes for which same are leased to Tenant, as and when needed to preserve
them in good working order and condition. Except as otherwise provided in
Section 9.05 hereof, all damage or injury to the Building or Premises, including
demised premises, and to its fixtures, appurtenances and equipment caused by
Tenant moving property in or out of the Building or by installation or removal
by Tenant of furniture, fixtures or other property, shall be repaired, restored
or replaced promptly by Tenant at its sole cost and expense, which repairs,
restorations and replacements shall be in quality and class equal to the
original work or installations. If Tenant fails to make such repairs,
restoration or replacements, same may be made by Landlord at the expense of
Tenant and such expense shall be collectible as additional rent and shall be
paid by Tenant within ten days after rendition of a bill therefor. Subject to
Tenant's obligations set forth above, Landlord shall maintain and repair the
exterior of the Building and public portions of the Building, all structural
elements of the Building, air-conditioning cooling towers on the roof, and all
building systems serving the demised premises, including pipes, lines and the
like located outside of the demised premises. Landlord shall have no obligation
with respect to any items included in Tenant's Extra Work, or constructed or
installed in the demised premises by Tenant, or located in the demised premises,
or exclusively serving the demised premises.
The exterior walls of the Building, the portions of any window sills
outside the windows and the windows are not part of the premises demised by this
Lease and Landlord reserves all rights to such parts of the Building, but the
foregoing shall not relieve Tenant of any obligation to restore, repair, or
replace same in accordance with the immediately preceding paragraph.
7.02. Tenant shall not place a load upon any floor of the demised premises
exceeding the floor load per square foot area which such floor was designed to
carry and which is allowed by law.
7.03. Business machines and mechanical equipment used by Tenant which cause
vibration, noise, cold or heat that may be transmitted to the Building structure
or to any leased space to such a degree as to be reasonably objectionable to
Landlord or to any other tenant in the Building shall be placed and maintained
by Tenant at its expense in settings of cork, rubber or spring type vibration
eliminators sufficient to absorb and prevent such vibration or noise, or prevent
transmission of such cold or heat. The parties hereto recognize that the
operation of elevators, air conditioning and heating equipment will cause some
vibration, noise, heat or cold which may be transmitted to other parts of the
Building and demised premises. Landlord shall be under no obligation to endeavor
to reduce such vibration, noise, heat or cold beyond what is customary in
current good building practice for buildings of the same type as the Building.
7.04. Except as otherwise specifically provided in this Lease, there shall
be no allowance to Tenant for a diminution of rental value and no liability on
the part of Landlord by reason of inconvenience, annoyance or injury to business
arising from the making of any repairs, alterations, additions or improvements
in or to any portion of the Building or the demised premises or in or to
14
fixtures, appurtenances or equipment thereof. Landlord shall exercise reasonable
diligence so as to minimize any interference with Tenant's business operations,
but shall not be required to perform the same on an overtime or premium pay
basis.
7.05 Landlord shall maintain a code compliant Class E System and shall
comply with the American with Disabilities Act, but the foregoing shall apply
only to areas outside of the demised premises and shall not require Landlord to
take any action with respect to areas outside of the demised premises resulting
from the particular use or occupancy of the demised premises by Tenant.
ARTICLE 8
REQUIREMENTS OF LAW
8.01. Tenant shall comply with all Legal Requirements which shall impose
any violation, order or duty upon Landlord or Tenant with respect to the
particular use by Tenant of the demised premises, or arising out of the
particular use or occupation thereof by Tenant.
8.02. Notwithstanding the provisions of Section 8.01 hereof, Tenant, at its
own cost and expense, in its name and/or (whenever necessary) Landlord's name,
may contest, in any manner permitted by law (including appeals to a court, or
governmental department or authority having jurisdiction in the matter), the
validity or the enforcement of any Legal Requirements with which Tenant is
required to comply pursuant to this Lease, and may defer compliance therewith
provided that:
(a) such non-compliance shall not subject Landlord to criminal
prosecution or subject the Premises to lien or sale;
(b) such non-compliance shall not be in violation of any
mortgage, or of the Over Lease or of any ground or underlying lease or any
mortgage thereon;
(c) Tenant shall first deliver to Landlord a surety bond issued
by a surety company of recognized responsibility, or other security reasonably
satisfactory to Landlord, indemnifying and protecting Landlord or Over Landlord
against any loss or injury by reason of such non-compliance; and
(d) Tenant shall promptly, diligently and continuously prosecute
such contest.
Landlord, without expense or liability to it, shall cooperate
with Tenant and execute any documents or pleadings required for such purpose,
provided that Landlord shall reasonably be satisfied that the facts set forth in
any such documents or pleadings are accurate.
15
ARTICLE 9
INSURANCE, LOSS, REIMBURSEMENT, LIABILITY
9.01. Tenant shall not do or permit to be done any act or thing upon or
about the demised premises, which will invalidate or be in conflict with New
York standard fire insurance policies covering the Building, and fixtures and
property therein, or which would increase the rate of fire insurance applicable
to the Building to an amount higher than it otherwise would be if the demised
premises were used for executive and general offices; and Tenant shall neither
do nor permit to be done any act or thing upon the demised premises which shall
or might subject Landlord to any liability or responsibility for injury to any
person or persons or to property by reason of any business or operation being
carried on within the demised premises; but nothing in this Section 9.01 shall
prevent Tenant's use of the demised premises for the purposes stated in Article
5 hereof.
9.02. If, as a result of any act or omission by Tenant or violation of this
Lease by Tenant, the rate of fire insurance applicable to the Building shall be
increased, Tenant shall reimburse Landlord for all increases of Landlord's and
other tenants' fire insurance premiums so caused; such reimbursement to be
additional rent payable within five days after demand therefor by Landlord. Any
disputes under Section 9.02 shall be resolved in accordance with Article 37.
9.03. Landlord or its agent shall not be liable for any injury or damage to
persons or property resulting from fire, explosion, falling plaster, steam, gas,
electricity, water, rain or snow or leaks from any part of the Building, or from
the pipes, appliances or plumbing works or from the roof, street or subsurface
or from any other place or by dampness or by any other cause of whatsoever
nature, unless any of the foregoing shall be caused by or due to the willful
misconduct or gross negligence of Landlord, its agents, servants or employees.
9.04. Landlord or its agents shall not be liable for any damage which
Tenant may sustain, if at any time any window of the demised premises is broken,
or temporarily or permanently closed, darkened or bricked upon for any reason
whatsoever, except only Landlord's arbitrary acts if the result is permanent and
Tenant shall not be entitled to any compensation therefor or abatement of rent
or to any release from any of Tenant's obligations under this Lease, nor shall
the same constitute an eviction or constructive eviction. Landlord shall not,
unless required by any Legal Requirement, authorize the blocking of any window
in the demised premises by any sign or obstruction placed on the Building's
facade (unless needed for repair, restoration or maintenance of the Building),
or permit the windows to be bricked, closed or darkened, to the extent same is
under the control of Landlord..
9.05. Tenant shall reimburse Landlord for all expenses, damages or fines
incurred or suffered by Landlord, by reason of any act, breach, violation or
non-performance by Tenant, or its agents, servants or employees, of any covenant
or provision of this Lease, or by reason of damage
16
to persons or property caused by moving property of or for Tenant in or out of
the Building, or by the installation or removal of furniture or other property
of or for Tenant, or by reason of or arising out of any act of Tenant, or its
agents, servants or employees, in the use or occupancy of the demised premises.
Subject to compliance with the provisions of Section 8.02 hereof, where
applicable, Tenant shall have the right, at Tenant's own cost and expense, to
participate in the defense of any action or proceeding brought against Landlord,
and in negotiations for settlement thereof if, pursuant to this Section 9.05,
Tenant would be obligated to reimburse Landlord for expenses, damages or fines
incurred or suffered by Landlord.
9.06. Tenant shall give Landlord notice in case of fire or accidents in the
demised premises promptly after Tenant becomes aware of such event.
9.07. Tenant agrees to look solely to Landlord's interest in the Premises
and in the Over Lease, and the demised premises, for the satisfaction of any
right or remedy of Tenant for the collection of a judgment (or other judicial
process) requiring the payment of money by Landlord, in the event of any
liability by Landlord, and no other property or assets of Landlord shall be
subject to levy, execution, attachment, 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 and occupancy of
the demised premises, or any other liability of Landlord to Tenant.
9.08. Each party, on behalf of itself and on behalf of anyone claiming
under or through it by way of subrogation or otherwise, waives all rights and
causes of action against the other party, and the officers, employees, agents
and invitees of the other party, for any liability arising out of any loss or
damage in or to the demised premises and/or the Building or Premises, its
contents and other property owned or controlled by or caused by:
(i) any peril normally covered under all-risk policies issued in the
geographic area in which the Building is located (whether or not such
party actually carries such insurance policies), or
(ii) if the scope of coverage is broader than in (i) above, then any peril
actually covered under the insurance maintained by such party.
This release and waiver shall be complete and total even if such loss or
damage may have been caused by the negligence of the other party, its officers,
employees, agents or invitees and shall not be affected or limited by the amount
of insurance proceeds available to the waiving party, regardless of the reason
for such deficiency in proceeds. If any additional charge or increase in premium
is made by the insurer because of this waiver of subrogation, then the party in
whose favor the waiver was obtained shall pay such additional charge or increase
in premium; failure to pay the increase in premium will void the release and
waiver benefitting such party but shall not affect the benefit of the
corresponding release and waiver enjoyed by the other party.
17
However, if one party's insurance carrier prohibits waiver of subrogation
regardless of premium, then the other party's release and waiver shall become
null and void, it being understood that in this instance each waiver is given in
consideration for the other.
Each party covenants that from and after the date possession of the demised
premises is delivered to Tenant its insurance policies will contain waiver of
subrogation endorsements, and that if such endorsements, for any reason
whatsoever, are about to become unavailable, it will give the other party not
less than thirty (30) days prior written notice of such impending
unavailability.
9.09. Tenant covenants and agrees to provide at its expense on or before
the Commencement Date and to keep in force during the Term naming Landlord and
Over Landlord as additional insured parties a comprehensive general liability
insurance policy including but not limited to premises operation blanket
contractual insurance, broad form property damage, independent contractor's
coverage and personal injury coverage protecting Landlord, Over Landlord and
Tenant against any liability whatsoever, occasioned by any occurrence on or
about the demised premises or any appurtenances thereto. Such policy is to be
written by good and solvent insurance companies licensed to do business in the
State of New York reasonably satisfactory to Landlord, and shall be in such
limits as Landlord may reasonably require. As of the date of this Lease Landlord
reasonably requires limits of liability thereunder of not less than $3,000,000
per occurrence for bodily or personal injury (including death) and in the amount
of $1,000,000 per occurrence in respect of property damage. Such insurance may
be carried under a blanket policy covering the demised premises and other
locations of Tenant, if any, provided that each such policy shall in all
respects, comply with this Article and shall specify that the portion of the
total coverage of such policy that is allocated to the demised premises is in
the amount required pursuant to this Section 9.09. Prior to the time such
insurance is first required to be carried by Tenant and thereafter, at least 15
days prior to the effective date of any such policy, Tenant agrees to deliver to
Landlord a certificate of such insurance, followed within thirty (30) days by a
duplicate original of the aforesaid policy. Said policy shall contain an
endorsement that such insurance may not be cancelled except upon 30 days' prior
notice to Landlord. Such policy shall also have the indemnity clause referred to
in Article 38 hereof typed on the policy evidencing that the "hold harmless"
clause has been insured. Tenant's failure to provide and keep in force the
aforementioned insurance shall be regarded as a material default hereunder
entitling Landlord to exercise any or all of the remedies provided in this Lease
in the event of Tenant's default. Notwithstanding anything to the contrary
contained in this Lease, the carrying of insurance by Tenant in compliance with
this Section shall not modify, reduce, limit or impair Tenant's obligations and
liability under Article 38 hereof.
ARTICLE 10
DAMAGE BY FIRE OR OTHER CAUSE
18
10.01. If the Building or the demised premises shall be partially or
totally damaged or destroyed by fire or other cause (and if this Lease shall not
have been terminated as in this Article 10 hereinafter provided), Landlord shall
repair the damage and restore and rebuild the Building and/or the demised
premises, at its expense with reasonable dispatch after notice to it of the
damage or destruction.
10.02. If the Building or the demised premises shall be damaged or
destroyed by fire or other causes, then unless such fire or damage shall have
resulted from the negligence of Tenant or its officers, contractors, licensees,
agents, employees, guests, invitees or visitors, the rents payable hereunder
shall be abated to the extent that the demised premises shall have been rendered
untenantable for the period from the date of such damage or destruction to the
date the damage shall be repaired or restored; provided, however, that should
Tenant reoccupy a portion of the demised premises during the period the
restoration work is taking place and prior to the date that the whole of said
demised premises are made tenantable, fixed annual rent and additional rents
allocable to such portion shall be payable by Tenant from the date of such
reoccupancy.
10.03. If the Building shall be so damaged or destroyed by fire or other
cause (whether or not the demised premises are damaged or destroyed) as to
require a reasonably estimated expenditure made by Landlord or a reputable
contractor reasonably designated by Landlord of more than 50% of the full
replacement value of the Building immediately prior to the casualty, then
Landlord may terminate this Lease by giving Tenant notice to such effect within
120 days after the date of the casualty. In case of any damage or destruction
mentioned in this Article 10 which Landlord is required to repair and restore,
Tenant may terminate this Lease by notice to Landlord if Landlord has not
completed the making of the required repairs and restorations within 15 months
after the date of such damage or destruction, or within such period after such
date (not exceeding 6 months) as shall equal the aggregate period Landlord may
have been delayed in doing so by adjustment of insurance, labor trouble,
governmental controls, act of God, or any other cause beyond Landlord's
reasonable control.
10.04. 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 or of the Building pursuant
to this Article 10.
10.05. Notwithstanding any of the foregoing provisions of this Article 10,
if Landlord or the Over Landlord or the lessor of any superior lease or the
holder of any superior mortgage shall be unable to collect all of the insurance
proceeds (including rent insurance proceeds) applicable to damage or destruction
of the demised premises or the Building by fire or other cause, by reason of
some action or inaction on the part of Tenant or any of its employees, agents or
contractors, then, without prejudice to any other remedies which may be
available against Tenant, there shall be no abatement of Tenant's rents, but the
total amount of such rents not abated (which would otherwise have been abated)
shall not exceed the amount of uncollected
19
insurance proceeds.
10.06. Landlord will not carry separate insurance of any kind on Tenant's
property (including, without limitation, any property of Tenant which shall
become the property of Landlord as provided in Article 6 hereof), and, except as
provided by law, Landlord shall not be obligated to repair any damage thereto or
replace or clear the same, or any other decorations, installations, equipment or
fixtures installed by or for Tenant at Tenant's expense, or Tenant's Extra Work.
Tenant shall maintain such fire and casualty insurance as it deems advisable.
10.07. The provisions of this Article 10 shall be considered an express
agreement governing any cause of damage or destruction of the demised premises
by fire or other casualty, and Section 227 of the Real Property Law of the State
of New York, providing for such a contingency in the absence of an express
agreement, and any other law of like import, now or hereafter in force, shall
have no application in such case.
10.08. Landlord shall maintain fire and other casualty insurance on the
Building.
ARTICLE 11
ASSIGNMENT, MORTGAGING, SUBLETTING, ETC.
11.01. Except as otherwise expressly provided in this Article 11, Tenant
shall not without, in each instance, obtaining the prior consent of Landlord,
which consent shall not be unreasonably withheld or delayed, (a) assign or
otherwise transfer this Lease or the term and estate hereby granted, (b) sublet
all or part of the demised premises or allow the same to be used or occupied by
others or in violation of Article 5, (c) mortgage, pledge or encumber this Lease
or all or part of the demised premises in any manner by reason of any act or
omission on the part of Tenant, or (d) advertise, or authorize a broker to
advertise, for a subtenant for all or part of the demised premises or for an
assignee of this Lease. For purposes of this Article 11, (i) the transfer of a
majority of the issued and outstanding capital stock of any corporate tenant or
subtenant, or the transfer of a majority of the total interest in any other
entity (partnership or otherwise) which is a tenant or subtenant, however
accomplished, whether in a single transaction or in a series of related or
unrelated transactions, shall be deemed an assignment of this Lease, or such
sublease, as the case may be, provided, however, that the foregoing shall not
apply to a public offering of Tenant's securities on a recognized national
market, or to any transfer of shares which are publically traded, or to a sale
of shares to one acquirer, or to the transfer of shares by a share owner in
connection with such share owner's estate planning, (ii) a takeover agreement
shall be deemed a transfer of this Lease, (iii) any person or legal
representative of Tenant, to whom Tenant's interest under this Lease passes by
operation of law, or otherwise, shall be bound by the provisions of this Article
11, and (iv) a modification, amendment or extension without Landlord's prior
written consent of a sublease previously consented to by Landlord shall be
deemed a new sublease, unless such
20
extension was contained in the sublease previously approved by Landlord, but
with a term not beyond the Expiration Date. Tenant agrees to furnish to Landlord
upon demand at any time and from time to time such information and assurances as
Landlord may reasonably request that neither Tenant, nor any subtenant, shall
have violated the provisions of this Section 11.01.
11.02. The provisions of clauses (a), (b) and (d) of Section 11.01 and the
provisions of Sections 11.05 and 11.06(e) hereof shall not apply to (and
Landlord's consent shall not be required for, but notice shall nonetheless be
given to Landlord), transactions entered into by Tenant with a Tenant Affiliate.
"Tenant Affiliate" shall mean (i) an entity into which the Tenant is merged or
consolidated or to which Tenant sells substantially all its assets, provided
such merger, consolidation or asset sale results in the successor entity being
fully liable under this Lease and such successor entity having a net worth at
least equal to or in excess of the net worth of Tenant as of the date hereof;
(ii) an entity which controls, is controlled by or is under common control with
Tenant (the term "control" meaning ownership of not less than 25% of the
outstanding voting interests of such entity); or (iii) a partnership in which
and for so long as Tenant or a Tenant Affiliate shall be a general partner and
of which Tenant (or one or more Tenant Affiliates) shall own not less than 25%
of the legal equitable interest.
11.03. Any assignment or transfer, whether made with Landlord's consent as
required by Section 11.01 or without Landlord's consent pursuant to Section
11.02, shall not be effective unless and until (a) the assignee of the Lease
shall execute, acknowledge and deliver to Landlord a recordable agreement, in
form and substance reasonably satisfactory to Landlord, whereby the assignee
shall (i) assume the obligations and performance of this Lease and agree to be
personally bound by all of the covenants, agreements, terms, provisions and
conditions hereof on the part of Tenant to be performed or observed on and after
the effective date of any such assignment and (ii) agree that the provisions of
this Article 11 shall, notwithstanding such assignment or transfer, continue to
be binding upon it in the future, and (b) in the case of an assignment or
transfer pursuant to Section 11.02(i), Tenant or its successor shall have
delivered to Landlord financial statements certified by a reputable firm of
certified public accountants evidencing satisfaction of the net worth
requirements referred to in Section 11.02. Tenant covenants that,
notwithstanding any assignment or transfer, whether or not in violation of the
provisions of this Lease, and notwithstanding the acceptance of fixed annual
rent by Landlord from an assignee or transferee or any other party, Tenant shall
remain fully and primarily and jointly and severally liable for the payment of
the fixed annual rent and all additional rent due and to become due under this
Lease and for the performance and observance of all of the covenants,
agreements, terms, provisions and conditions of this Lease on the part of Tenant
to be performed or observed.
11.04. The liability of Tenant, and the due performance by Tenant of the
obligations on its part to be performed under this Lease, shall not be
discharged, released or impaired in any respect by an agreement or stipulation
made by the Landlord or any grantee or assignee of Landlord, by way of mortgage,
or otherwise, extending the time of, or modifying any of the obligations
contained in this Lease, or by any waiver or failure of Landlord to enforce any
of the obligations
21
on Tenant's part to be performed under this Lease, and Tenant shall continue to
be liable hereunder. If any such agreement or modification operates to increase
the obligations of a tenant under this Lease, the liability under this Section
11.04 of the tenant named in the Lease or any of its successors in interest
(unless such party shall have expressly consented in writing to such agreement
or modification) shall continue to be no greater than if such agreement or
modification had not been made.
11.05. Landlord shall not unreasonably withhold or delay its consent to an
assignment of this Lease or a subletting of the whole or a part of the demised
premises, and shall respond to any request for such consent within 30 days of
receipt of such request, provided:
(a) Tenant shall furnish Landlord with the name and business
address of the proposed subtenant or assignee, information with respect to the
nature and character of the proposed subtenant's or assignee's business, or
activities, such references and current financial information with respect to
net worth, credit and financial responsibility as are reasonably satisfactory to
Landlord, and a term sheet setting forth the proposed terms and conditions of
such subletting or assignment, as applicable;
(b) The proposed subtenant or assignee is a reputable party whose
financial net worth, credit and financial responsibility is, considering the
responsibilities involved, reasonably satisfactory to Landlord, and in all
events with a net worth in excess of $150,000,000 per floor, or part thereof,
occupied by such subtenant or assignee.
(c) The nature and character of the proposed subtenant or
assignee, its business or activities and intended use of the demised premises
are, in Landlord's reasonable judgment, in keeping with the standards of the
Building;
(d) The proposed subtenant or assignee is not then an occupant of
any part of the Building or a party who dealt with Landlord or Landlord's agent
(directly or through a broker) with respect to space in the Building, during the
12 months immediately preceding Tenant's request for Landlord's consent, but
only if Landlord then has vacant space in the Building available for rental, or
becoming available within the next 12 months;
(e) All costs incurred with respect to providing reasonably
appropriate means of ingress and egress from the sublet space or to separate the
sublet space from the remainder of the demised premises shall, subject to the
provisions of Article 6 with respect to alterations, installations, additions or
improvements, be borne by Tenant;
(f) Each assignment or sublease shall specifically state that (i)
it is subject to all of the terms, covenants, agreements, provisions, and
conditions of this Lease, (ii) the subtenant or assignee, as the case may be,
will not have the right to further assign or sublet all or part of the demised
premises or to allow same to be used by others, without the consent of
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Landlord in each instance, (iii) a consent by Landlord thereto shall not be
deemed or construed to modify, amend or affect the terms and provisions of this
Lease, or Tenant's obligations hereunder, which shall continue to apply to the
premises involved, and the occupants thereof, as if the sublease or assignment
had not been made, (iv) if Tenant defaults in the payment of any rent, Landlord
is authorized to collect any rents due or accruing from any assignee, subtenant
or other occupant of the demised premises and to apply the net amounts collected
to the fixed annual rent and additional rent due hereunder, and (v) the receipt
by Landlord of any amounts from an assignee or subtenant, or other occupant of
any part of the demised premises shall not be deemed or construed as releasing
Tenant from Tenant's obligations hereunder or the acceptance of that party as a
direct tenant.
(g) Tenant, together with requesting Landlord's consent
hereunder, shall have paid Landlord any reasonable costs incurred by Landlord to
review the requested consent including any reasonable attorneys' fees incurred
by Landlord;
(h) In the case of a subletting of a portion of the demised
premises, the portion so sublet shall be regular in shape and suitable for
normal renting purposes;
(i) Tenant shall have given Landlord not less than 30 days prior
notice of its intention to offer to sublet more than 50% of the demised premises
for more than 75% of the remainder of the Term, or assign this Lease, and shall
first offer the space on the same terms to any existing tenant in the Building
if so requested by Landlord within 30 days after receipt of Tenant's notice. If
Tenant enters into such an assignment or sublet with an existing tenant in the
Building, as requested by Landlord, then Tenant shall be relieved of its
obligations hereunder with respect to the portion of the demised premises so
assigned or sublet, but only to the extent that Tenant's obligations hereunder
are specifically assumed by the assignee or sublessee, and except for those
obligations which arose prior to such assignment/sublease transaction or which
specifically survive any termination or expiration of this Lease.
(j) The subletting or assignment shall not be at a lower
aggregate rental than that being charged by Landlord at the time for similar
space then available for rental in the Building;
(k) The proposed assignment or sublease shall provide that it is
subject to the Landlord's rights under Section 11.06 hereof. Tenant shall have
complied with the provisions of said Section 11.06 and Landlord shall not have
made any of the elections provided for therein; and
(l) The total number of tenants and subtenants occupying the
entire fifth floor shall not exceed three.
11.06 (a) Should Tenant desire to assign this Lease or to sublet all or any
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portion of the demised premises (other than by an assignment or sublease
permitted by Section 11.02 hereof), Tenant shall deliver to Landlord a term
sheet, which term sheet shall specifically reference and address the matters set
forth in Section 11.05, setting forth the proposed terms and conditions of such
subletting or assignment, as applicable, and shall comply with the other
provisions of this Article 11, and Landlord shall then have the right to elect
by notice to Tenant given within 30 days after such delivery to (i) consent
(which consent shall have been deemed granted by Landlord if Landlord shall not
have disapproved of the transaction in writing, within 30 days of Landlord's
actual receipt of within notice from Tenant advising Landlord of Tenant's
intention to assign or sublet along with such other documents and information as
is required under this Article 11), or (ii) refuse to consent to such assignment
or sublease in accordance with the terms of this Lease. Notwithstanding the
foregoing, if such sublet (or such sublet, together with any prior or
contemporaneous sublets, in the aggregate) is for 50% or more of the demised
premises and is for more than 75% of the remainder of the Term, or if Tenant has
agreed to assign this Lease, Landlord may elect to, within 30 days after
Landlord receives the term sheet described above, (x) with respect to a proposed
assignment of this Lease, terminate this Lease as of the date which is 90 days
after Landlord receives the term sheet as described above as if it were the
Expiration Date set forth herein; or (y) with respect to a proposed subletting,
terminate this Lease as to the portion of the demised premises affected by such
subletting as of the date which is 90 days after Landlord receives the term
sheer as described above, in which case Tenant shall promptly execute and
deliver to Landlord an appropriate modification of this Lease in form
satisfactory to Landlord.
(b) Tenant shall, as soon as any permitted assignment or sublease
is consummated, deliver to Landlord copies of the executed assignment or
sublease document.
(c) Intentionally omitted.
(d) If pursuant to the exercise of any of Landlord's options
under this Section 11.06, this Lease is terminated as to only a portion of the
demised premises, then the fixed annual rent and the additional rent due under
this Lease shall be adjusted in proportion to the portion of the demised
premises affected by such termination as reasonably determined by Landlord.
(e) If the Landlord shall give its consent to any assignment of
this Lease or to any sublease, Tenant shall in consideration therefor, pay to
Landlord, as additional rent:
(i) in the case of an assignment, an amount equal to 50% of
all sums and other considerations paid to Tenant by the assignee
for or by reason of such assignment (including, but not limited
to, sums paid for the sale of Tenant's fixtures (other than trade
fixtures) and leasehold improvements, sums paid for the sale of
Tenant's trade fixtures, equipment, furniture, furnishings or
other personal property in excess of the then depreciated value
of same as carried on the books of
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Tenant), less direct and actual costs incurred by Tenant in
connection with such assignment, such as real estate commissions,
legal fees and alterations made at Tenant's expense pursuant to
an assignment agreement, but not including any alterations which
would be required to return the space to Building Standard, and
not including the unamortized cost of any of Tenant's fixtures,
leasehold improvements, equipment, fixtures, furnishings or other
items, except as set forth above, and
(ii) in the case of a sublease, 50% of any rents, additional
charges or other consideration payable under the sublease to
Tenant by the subtenant which is in excess of the fixed annual
rent and additional rent accruing during the term of the sublease
in respect of the subleased space pursuant to the terms hereof
(including, but not limited to, sums paid for the sale or rental
of Tenant's fixtures (other than trade fixtures) and lease-hold
improvements, sums paid for the sale or rental of Tenant's trade
fixtures, equipment, furniture or furnishings or other personal
property in excess of the then depreciated value of same as
carried on the books of Tenant, less direct and actual costs
incurred by Tenant in connection with such sublease, such as real
estate commissions, legal fees, and alterations made at Tenant's
expense pursuant to a sublease agreement, but not including any
alterations which would be required to return the space to
Building Standard, and not including the unamortized cost of any
of Tenant's fixtures, leasehold improvements, equipment fixtures,
furnishings or other items, except as set forth above.
The sums payable under this Section 11.06(e) shall be paid to Landlord, within
fifteen (15) days after payment by the assignee or subtenant to Tenant. Nothing
contained in this Section shall restrict Tenant from selling any personal
property of Tenant to any person or entity, not an assignee or subtenant, as
described above, or retaining all of the proceeds of any such sale.
(f) If Landlord exercises any of its options under this Section
11.06, Landlord shall be free to, and shall have no liability to Tenant if
Landlord shall, lease the demised premises or any portion thereof with respect
to which one of such options exercised, to Tenant's proposed assignee or
subtenant, as the case may be.
(g) If Landlord exercises any of its options under this Section
11.06 to terminate this Lease, whether as to the whole or any part of the
demised premises, Tenant shall be relieved of its obligations hereunder with
respect to said whole or portion of the demised premises, as the case may be,
except for those obligations which arise prior to such termination or which
specifically survive any termination or the expiration of this Lease.
ARTICLE 12
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CERTIFICATE OF OCCUPANCY
12.01. Annexed hereto as Exhibit C is a true and complete copy of the
Certificate of Occupancy for the Building.
ARTICLE 13
ADJACENT EXCAVATION - SHORING
13.01. If an excavation or other substructure work shall be made upon land
adjacent to the demised premises, or shall be authorized to be made, Tenant
shall afford to the person causing or authorized to cause such excavation,
license to enter upon the demised premises for the purpose of doing such work as
shall be reasonably necessary to preserve the wall of or the Building of which
the demised premises form a part from injury or damage and to support the same
by proper foundations without any claim for damages or indemnity against
Landlord, or diminution or abatement of rent.
ARTICLE 14
CONDEMNATION
14.01. In the event that the whole of the demised premises shall be
lawfully condemned or taken in any manner for any public or quasi-public use,
this Lease and the term and estate hereby granted shall forthwith cease and
terminate as of the date of vesting of title. In the event that only a part of
the demised premises shall be so condemned or taken, then, effective as of the
date of vesting of title, the fixed annual rent and additional rent due under
this Lease shall be abated proportionately according to the reduction in the
rentable area of the demised premises resulting from such condemnation or
taking. In the event that only a part of the Building shall be so condemned or
taken, then (a) Landlord (whether or not the demised premises shall be affected)
may, at Landlord's option, if such taking is for more than 50% of the Building,
terminate this Lease and the term and estate hereby granted as of the date of
such vesting of title by notifying Tenant in writing of such termination within
60 days following the date on which Landlord shall have received notice of
vesting of title, or (b) if such condemnation or taking shall be of a
substantial part of the demised premises or of a substantial part of the means
of access thereto, Tenant may, at Tenant's option, by delivery of notice in
writing to Landlord within 30 days following the date on which Tenant shall have
received notice of vesting of title, terminate this Lease and the term and
estate hereby granted as of the date of vesting of title, or (c) if neither
Landlord nor Tenant elects to terminate this Lease, as aforesaid, this Lease
shall be and remain unaffected by such condemnation or taking, except that the
fixed annual rent payable under Article 1 and additional rents payable under
Article 3 shall be abated to the extent hereinbefore provided
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in this Article 14.
14.02. In the event of termination of this Lease in any of the cases
hereinbefore provided, this Lease and the term and estate hereby granted shall
expire as of the date of such termination with the same effect as if that were
the Expiration Date, and the fixed annual rent and additional rents payable
hereunder shall be apportioned as of such date.
14.03. In the event of any condemnation or taking of all or a part of the
Building, Landlord shall be entitled to receive the entire award in the
condemnation proceeding, including any award made for the value of the estate
vested by this Lease in Tenant. Tenant hereby expressly assigns to Landlord
(subject to the preceding sentence), any and all right, title and interest of
Tenant now or hereafter arising in or to any such award or any part thereof, and
agrees that it shall not be entitled to receive any part of such award.
14.04. In the event of any taking of less than the whole of the Building
which does not result in a termination of this Lease, Landlord, at its expense,
shall proceed with reasonable diligence to repair, alter and restore the
remaining parts of the Building and the demised premises to substantially their
former condition to the extent that the same may be feasible and so as to
constitute a complete and tenantable Building and demised premises. Tenant may
terminate this Lease by notice to Landlord if Landlord has not completed the
making of the required repairs and restorations within 15 months after the date
of such taking, or within such period after such date (not exceeding 6 months)
as shall equal the aggregate period Landlord may have been delayed in doing so
by adjustment of insurance, labor trouble, governmental controls, act of God, or
any other cause beyond Landlord's reasonable control.
14.05. In the event any part of the demised premises be taken to effect
compliance with any law or requirement of public authority other than in the
manner hereinabove provided in this Article 14, then (i) if such compliance is
the obligation of Tenant under this Lease, Tenant shall not be entitled to any
diminution or abatement of rent or other compensation from Landlord therefor,
but (ii) if such compliance is the obligation of Landlord under this Lease, the
fixed annual rent hereunder shall be reduced and additional rents under Article
3 shall be adjusted in the same manner as is provided in Section 14.01 according
to the reduction in rentable area of the demised premises resulting from such
taking.
14.06. Tenant shall have the right to seek an award for its own personal
property loss and relocation costs.
ARTICLE 15
ACCESS TO DEMISED PREMISES; CHANGES
15.01. (a) Tenant shall permit Landlord to erect, use and maintain pipes,
ducts and
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conduits in and through the demised premises, provided the same are installed
adjacent to, or to the extent reasonably practicable, concealed behind walls and
ceilings of the demised premises. Landlord shall to the extent practicable
install such pipes, ducts and conduits by such methods and at such locations as
will not materially interfere with or impair Tenant's layout or use of the
demised premises. Landlord or its agents or designees shall have the right, but
only upon reasonable prior notice to Tenant or any authorized employee of Tenant
at the demised premises, to enter the demised premises (a) for the making of
such repairs or alterations as Landlord may deem necessary for the Building or
which Landlord shall be required to or shall have the right to make by the
provisions of this Lease or any other lease in the Building, and (b) for the
purpose of inspecting them or exhibiting them to existing or prospective
purchasers, mortgagees or lessees of all or part of the Building or the Premises
or to prospective assignees, agents or designees of any such parties. Landlord
shall be allowed to take all material into and upon the demised premises that
may be required for the repairs or alterations above mentioned without the same
constituting an actual or constructive eviction of Tenant in whole or in part,
and the rent reserved hereunder shall not abate while said repairs or
alterations are being made by reason of loss or interruption of the business of
Tenant because of the prosecution of any such work. Landlord shall exercise
reasonable diligence so as to minimize the disturbance to Tenant but nothing
contained herein shall be deemed to require Landlord to perform any work on an
overtime or premium pay basis.
(b) Notwithstanding anything to the contrary contained in the
preceding paragraph, it is specifically agreed that Landlord reserves the
absolute right for itself and its agents, employees or designees to enter upon
the demised premises at such times, and with such frequency, as Landlord shall
determine in its sole and absolute discretion, without notice in the case of an
emergency and upon such notice as may be practicable under the circumstances in
non-emergency situations, for the purposes of installing, inspecting, adjusting,
maintaining, repairing or replacing all or any portion of the Building's
structural, electrical, plumbing, elevators and mechanical and HVAC systems as
are or are to be located in the demised premises and, in connection therewith,
to take all material into and upon the demised premises as Landlord deems
necessary in its sole and reasonable discretion to accomplish the foregoing
purposes. The rights herein reserved by Landlord shall include, without
limitation and without the exercise of such rights by Landlord or its agents,
employees or designee as herein permitted constituting an actual or constructive
eviction, or giving rise to any liability whatsoever on the part of Landlord, or
any claim by Tenant for damages or abatement of rents, the following:
(i) Access through the demised premises to stairways and
elevators at any time for any purpose set forth in or
contemplated by this Lease;
(ii) Access to all conduits, pipes, wires, ducts and valves
located in or accessible through, the demised premises,
including, without limitation, all water valves relating to
the Building's plumbing, mechanical and HVAC systems.
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Without limiting the rights of Landlord as expressly reserved above, Landlord
shall:
(x) Unless otherwise required by emergency or any other cause
beyond the reasonable control of Landlord, use reasonable efforts as are
practical under the circumstances to be accompanied by an employee of Tenant in
such access to the demised premises, and to exercise its rights hereunder in
such a manner as to minimize the disturbance to Tenant, but nothing contained
herein shall be deemed to require Landlord to perform work on an overtime or
premium pay basis; and
(y) Repair any damage done to any portion of the demised premises
which is damaged or destroyed as a result of Landlord's exercise of the rights
reserved in this paragraph 15.01.
15.02. Landlord reserves the right, without the same constituting an actual
or constructive eviction and without incurring liability to Tenant therefor, to
change the arrangement and/or location of public entrances, passageways, doors,
doorways, corridors, elevators, stairways, toilets and other public parts of the
Building; provided, however, that access to the Building shall not be cut off
and that there shall be no unreasonable obstruction of access to the demised
premises or unreasonable interference with the use or enjoyment thereof.
15.03. Intentionally Omitted.
15.04. Landlord may, during the eighteen (18) months prior to expiration of
the Term exhibit the demised premises to prospective tenants, upon reasonable
prior notice to Tenant (but Tenant may not require more than 24 hours advance
notice), and otherwise subject to this Article 15.
15.05. If Tenant shall not be personally present to open and permit an
entry into the demised premises at any time when for any reason an entry therein
shall be urgently necessary by reason of fire or emergency, Landlord or
Landlord's agents may forcibly enter the same (upon such notice, if any, as may
be practicable under the circumstances) without rendering Landlord or such
agents liable therefor (if during such entry Landlord or Landlord's agents shall
accord reasonable care to Tenant's property) and without in any manner affecting
the obligations and covenants of this Lease.
ARTICLE 16
CONDITIONS OF LIMITATION
16.01. This Lease and the term and estate hereby granted are subject to the
limitation that whenever Tenant shall make an assignment of the property of
Tenant for the benefit of creditors,
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or if a petition shall be filed by or against Tenant under any provisions of the
United States Bankruptcy Code or under the provisions of any other bankruptcy or
insolvency law or any law of like import, or whenever a permanent receiver of
Tenant or of or for the property of Tenant shall be appointed, then, Landlord
may (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 thirty (30) days, give Tenant a notice of
intention to end the Term of this Lease at the expiration of 5 days from the
date of service of such notice of intention, and upon the expiration of said 5
day period this Lease and the Term and estate hereby granted, whether or not the
Term shall theretofore have commenced, shall terminate with the same effect as
if that day were the Expiration Date, but Tenant shall remain liable for damages
as provided in Article 18.
16.02. This Lease and the Term and estate hereby granted are subject to
further limitation as follows:
(a) whenever Tenant shall fail to pay any installment of fixed
annual rent or any additional rent or any other charge payable by Tenant to
Landlord, on the day the same is due and payable pursuant to the terms hereof,
and such default shall continue for 5 days after Landlord shall have given
Tenant a notice specifying such default, or
(b) whenever Tenant shall do or permit anything to be done,
whether by action or inaction, contrary to any of Tenant's obligations
hereunder, and if such situation shall continue and shall not be remedied by
Tenant within 15 days after Landlord shall have given Tenant a notice specifying
the same, or, in the case of a happening or default which cannot with due
diligence be cured within a period of 15 days and the continuation of the period
required for cure will not subject Landlord to the risk of criminal liability
(as more particularly described in Article 8 hereof) or termination of the Over
Lease or any superior lease or foreclosure of any superior mortgage, if Tenant
shall not (i) within said 15 day period advise Landlord of Tenant's intention to
duly institute all steps necessary to remedy such situation, (ii) duly institute
within said 15 day period, and thereafter diligently and continuously prosecute
to completion all steps necessary to remedy the same, and (iii) complete such
remedy within such time after the date of the giving of said notice of Landlord
as shall reasonably be necessary, or
(c) whenever any event shall occur or any contingency shall arise
whereby this Lease or the estate hereby granted or the unexpired balance of the
Term hereof would, by operation of law or otherwise, devolve upon or pass to any
person, firm or corporation other than Tenant, except as expressly permitted by
Article 11, or
(d) whenever the demised premises shall be abandoned (unless as a
result of such a casualty), or
(e) whenever in case any other lease held by Tenant from Landlord
shall expire and terminate (whether or not the term thereof shall then have
commenced) as a result of
30
the default of Tenant thereunder:
in any of said cases set forth in the foregoing Subsections (a), (b), (c), (d),
or (e), Landlord may give to Tenant a notice of intention to end the Term at the
expiration of 3 days from the date of the service of such notice of intention,
and upon the expiration of said 3 days this Lease and the Term and estate hereby
granted, whether or not the Term shall theretofore have commenced, shall
terminate with the same effect as if that day were the Expiration Date, but
Tenant shall remain liable for damages as provided in Article 18.
16.03. Notwithstanding the cure periods provided for in Section 16.02(b),
such cure periods shall be reduced to such number of days as is necessary so as
to avoid placing Landlord in default under the provisions of any currently
existing Superior Instrument.
ARTICLE 17
RE-ENTRY BY LANDLORD, INJUNCTION
17.01. If Tenant shall fail to pay any installment of fixed annual rent, or
of any additional rent or any other charge payable by Tenant to Landlord on the
date the same is due and payable, and if such default shall continue for 5 days
after Landlord shall have given to Tenant a notice specifying such default, or
if this Lease shall terminate as in Article 16 provided, Landlord or Landlord's
agents and employees may immediately or at any time thereafter re-enter the
demised premises, or any part thereof, either by summary dispossess proceedings
or by any suitable action or proceeding at law, or by force or otherwise,
without being liable to indictment, prosecution or damages therefrom. The word
re-enter, as herein used, is not restricted to its technical legal meaning.
17.02. In the event of a breach or threatened breach by Tenant of any of
its obligations under this Lease, Landlord shall also have the right of
injunction. The special remedies to which Landlord may resort hereunder are
cumulative and are not intended to be exclusive of any other remedies or means
of redress to which Landlord may lawfully be entitled at any time and Landlord
may invoke any remedy allowed at law or in equity as if specific remedies were
not provided for herein.
17.03. If this Lease shall terminate under the provisions of Article 16, or
if Landlord shall re-enter the demised premises under the provisions of this
Article 17, or in the event of the termination of this Lease, or of re-entry by
or under any summary dispossess or other proceeding or action or any provision
of law by reason of default hereunder on the part of Tenant, then (a) Tenant
shall thereupon pay to Landlord the fixed annual rent and additional rent
payable by Tenant to Landlord up to the time of such termination of this Lease,
or of such recovery of possession of the demised premises by Landlord, as the
case may be, and shall also pay to Landlord
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damages as provided in Article 18, and (b) Landlord shall be entitled to retain
all moneys and to draw upon all letters of credit, if any, paid or given by
Tenant to Landlord, whether as advance rent, security or otherwise, but such
moneys shall be credited by Landlord against any fixed annual rent or additional
rent due from Tenant at the time of such termination or re-entry or, at
Landlord's option against any damages payable by Tenant under Articles 16 and 18
or pursuant to law.
17.04. Tenant hereby expressly waives any and all rights of redemption
granted by or under any present or future laws in the event of Tenant being
evicted or dispossessed for any cause, or in the event of Landlord obtaining
possession of the demised premises by reason of the violation by Tenant of any
of the covenants and conditions of this Lease or otherwise.
ARTICLE 18
DAMAGES
18.01. If this Lease is terminated under the provisions of Article 16, or
if Landlord shall re-enter the demised premises under the provisions of Article
17, or in the event of the termination of this Lease or of re-entry by or under
any summary dispossess or other proceeding or action or any provision of law by
reason of default hereunder on the part of Tenant, Tenant shall pay to Landlord
as damages (i) the amount required to restore the demised premises to Building
Standard; plus (ii) all additional rent accrued but unpaid to such date; plus
(iii) the unamortized portion of (x) any real estate brokerage commission paid
by Landlord in connection with this Lease and (y) Tenant's reimbursement for
Tenant's Extra Work, as set forth in Section 2.02 (each of (x) and (y) to be
amortized on a straight line basis over the Term); plus (iv) the unamortized
portion of any rent abatement granted by Landlord to Tenant amortized over the
term; plus (v) at the election of Landlord, either:
(a) a sum which at the time of such termination of
this Lease or at the time of any such re-entry by Landlord, as the case may be,
is the excess, if any, of
(1) the aggregate of the fixed annual rent and the additional
rent payable hereunder which would have been payable by
Tenant (conclusively presuming the additional rent to be the
same as was payable for the year immediately preceding such
termination except that additional rent on account of
increases in Real Estate Taxes shall be presumed to increase
at the average of the rates of increase thereof previously
experienced by Landlord during the period (not to exceed 3
years) prior to such termination) for the period commencing
with such earlier termination of this Lease or the date of
any such re-entry, as the case may be, and ending with the
Expiration Date, had this Lease not so terminated or had
Landlord not so re-entered the demised premises, over
32
(2) the aggregate rental value of the demised premises for the
same period, or
(b) sums equal to the fixed annual rent and the
additional rent payable hereunder which would have been payable by Tenant had
this Lease not so terminated, or had Landlord not so re-entered the demised
premises, payable upon the due dates therefor specified herein following such
termination or such re-entry and until the Expiration Date, provided, however,
that if Landlord shall re-let the demised premises during said period, Landlord
shall credit Tenant with the net rents received by Landlord from such
re-letting, such net rents to be determined by first deducting from the gross
rents as and when received by Landlord from such re-letting, the expenses
incurred or paid by Landlord in terminating this Lease or in re-entering the
demised premises and in securing possession thereof, as well as the expenses of
re-letting, including altering and preparing the demised premises for new
tenants (including tenant work letters), brokers' commissions, legal fees, and
all other expenses properly chargeable against the demised premises and the
rental thereof; it being understood that any such re-letting may be for a period
shorter or longer than the remaining term of this Lease. In no event shall
Tenant be entitled to receive any excess of such net rents over the sums payable
by Tenant to Landlord hereunder for the period of such re-letting, nor shall
Tenant be entitled in any suit for collection of damages pursuant to this
subsection to a credit in respect of any net rents from re-letting, except to
the extent that such net rents are actually received by Landlord. If the demised
premises or any part thereof should be re-let in combination with other space,
then proper apportionment on a square foot basis shall be made of the rent
received from such re-letting and of the expenses of re-letting. If the demised
premises or any part thereof be re-let by Landlord for the unexpired portion of
the term of this Lease, or any part thereof, before presentation of proof of
such damages to any court, commission or tribunal, the amount of rent payable
pursuant to such re-letting shall, prima facie, be the fair and reasonable
rental value for the demised premises, or part thereof, so re-let during the
term of the re-letting.
18.02. Suit or suits for the recovery of such damages, or any installments
thereof, may be brought by Landlord from time to time at its election, and
nothing contained herein shall be deemed to require Landlord to postpone suit
until the date when the Term would have expired if it had not been so terminated
under the provisions of Article 16, or under any provision of law, or had
Landlord not re-entered the demised premises. Nothing herein contained shall be
construed to limit or preclude recovery by Landlord against Tenant of any sums
or damages to which, in addition to the damages particularly provided above,
Landlord may lawfully be entitled by reason of any default hereunder on the part
of Tenant. Nothing herein contained shall be construed to limit or prejudice the
right of Landlord to prove for and obtain as liquidated damages by reason of the
termination of this Lease or re-entry of the demised premises for the default of
Tenant under this Lease, 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 any of the sums referred to in Section 18.01.
33
ARTICLE 19
LANDLORD'S RIGHT TO PERFORM TENANT'S OBLIGATIONS
19.01 If Tenant shall default in the observance or performance of any term
or covenant on Tenant's part to be observed or performed under any of the terms
or provisions of this Lease, (a) Landlord may remedy such default for the
account of Tenant, immediately and without notice in case of emergency, or in
any other case if Tenant shall fail to remedy such default with all reasonable
dispatch after Landlord shall have notified Tenant in writing of such default
and the applicable grace period for curing such default shall have expired; and
(b) if Landlord makes any expenditures or incurs any obligations for the payment
of money in connection with such default including, but not limited to,
reasonable attorneys' fees in instituting, prosecuting or defending any action
or proceeding, such sums paid or obligations incurred, with interest at the
Interest Rate, shall be deemed to be additional rent hereunder and shall be paid
by Tenant to Landlord upon rendition of a bill to Tenant therefor. The
provisions of this Article 19 shall survive the expiration or other termination
of this Lease.
ARTICLE 20
QUIET ENJOYMENT
20.01 Landlord covenants and agrees that subject to the terms and
provisions of this Lease, if, and so long as, Tenant keeps and performs each and
every covenant, agreement, term, provision and condition herein contained on the
part or on behalf of Tenant to be kept or performed, then Tenant shall be
entitled to the quiet enjoyment of the demised premises and Tenant's rights
under this Lease shall not be cut off or ended before the expiration of the term
of this Lease, subject however, to the obligations of this Lease.
ARTICLE 21
SERVICES AND EQUIPMENT
21.01. Landlord shall:
(a) Provide one passenger elevator 24 hours per day, seven (7)
days per week, three passenger elevators from 8:00 a.m. to 6:00 p.m. on Business
Days, and use of one freight elevator. The freight elevator is a manual elevator
(although it may be changed by Landlord in the future to automatic), which
Landlord's superintendent will operate, upon request, on Business Days from 9:00
a.m. to Noon and 1:00 p.m. to 4:30 p.m., as reasonably requested by Tenant when
shipments for Tenant arrive from the outside. Landlord's current charge for
freight
34
outside of the foregoing hours ("Overtime Use") is $65.00 per hour, with a 4
hour per day minimum. Request for such Overtime Use must be made at least one
day in advance.
(b) Furnish reasonable water for lavatory, kitchen and drinking
and office cleaning purposes. If Tenant requires, uses or consumes water for any
other purposes, Tenant agrees that Landlord may install a meter or meters or
other means to measure Tenant's water consumption, and Tenant further agrees to
reimburse Landlord for the cost of the meter or meters and the installation
thereof, and to pay for the maintenance of said meter equipment and/or to pay
Landlord's cost of other means of measuring such water consumption by Tenant.
Tenant shall reimburse Landlord for the cost of all water consumed, as measured
by said meter or meters or as otherwise reasonably measured, including sewer
rents.
(c) Furnish reasonable heat to the demised premises from 8 A.M.
to 6 P.M. on Business Days. Tenant shall give Landlord prior written notice of
need for Overtime Heat. Overtime Heat shall mean before 8 A.M. and after 6 P.M.
on Business Days, and all use on days which are not Business Days. Landlord's
current charge (which may be increased from time to time to reflect actual
increases in cost and/or increases in the consumers price index), for Overtime
Heat is $80 per hour, with a 4 hour minimum per day. Request for such use must
be made at least one day in advance.
(d) Nothing contained herein shall be deemed to require Landlord
to furnish at Landlord's expense such electric energy as is required to operate
the air conditioning system (including the cooling towers) serving the demised
premises, which system Landlord represents contains at least 110 tons (60 tons
in the south side unit and 50 tons in the north side unit). All such electric
energy shall be furnished to Tenant at Tenant's cost and expense. To the extent
such electric energy is not directly metered (such as the cooling towers), so as
to measure Tenant's individual consumption, Tenant shall pay to Landlord, as
additional rent, within ten days of the furnishing of a bill therefor, Tenant's
pro rata portion, determined on a square footage basis, and/or hours of use
basis, of the actual cost of electric energy for the cooling towers. Provided
Tenant pays for the electrical cost as set forth in the preceding sentence,
Landlord will provide to Tenant, chilled water from the cooling towers. Tenant
shall give Landlord prior written notice of overtime chilled water use. Overtime
Use shall mean before 8 A.M. and after 6 P.M. on Business Days, and all use on
days which are not Business Days. Landlord's current charge (which may be
increased from time to time to reflect actual increases in cost and/or increases
in the consumers price index), for overtime chilled water is $135.00 per hour
per floor, with a 4 hour minimum per day. Request for such use must be made at
least one day in advance.
21.02. Landlord reserves the right without any liability whatsoever, or
abatement of fixed annual rent, or additional rent, to stop the heating, air
conditioning, elevator, plumbing, electric and other systems when necessary by
reason of accident or emergency or for repairs, alterations, replacements or
improvements, provided that except in case of emergency, Landlord will notify
Tenant reasonably in advance, if possible, of any such stoppage and, if
ascertainable, its estimated
35
duration, and will proceed diligently with the work necessary to resume such
service as promptly as possible and in a manner so as to minimize interference
with the Tenant's use and enjoyment of the demised premises, but Landlord shall
not be obligated to employ overtime or premium labor therefor.
21.03. Tenant shall arrange for the cleaning of the demised premises and
the removal of its own refuse and rubbish.
21.04. Landlord shall provide one person in the lobby, 24 hours per day,
seven days per week, for security purposes who shall provide such security
services as are generally provided in similar office buildings (i.e., sign-in
book).
21.05. Tenant shall be entitled, without charge by Landlord, to have 50% of
the listings in the current directory located in the lobby, but not less than
the percentage of Tenant's Tax Share.
21.06. Landlord will not be required to furnish any other services, except
as otherwise provided in this Lease.
21.07 Tenant shall have 24-hours 7-days a week access to the demised
premises.
ARTICLE 22
DEFINITIONS
22.0. The term "Landlord" as used in this Lease means only the owner, or
the mortgagee in possession, at any time, of the Building (or the owner of a
lease of the Building or of the Premises and Building), so that in the event of
any transfer of title to said Premises and Building or said lease, or in the
event of a lease of the Building, or of the Premises and Building, upon
notification to Tenant of such transfer or lease the said transferor Landlord
shall be and hereby is entirely freed and relieved of all existing or future
covenants, obligations and liabilities of Landlord hereunder, and it shall be
deemed and construed as a covenant running with the land without further
agreement between the parties or their successors in interest, or between the
parties and the transferee of title to said Premises and Building or said lease,
or the said lessee of the Building or of the Premises and Building, that the
transferee or the lessee, as applicable, has assumed and agreed in writing to
carry out any and all such covenants, obligations and liabilities of Landlord
hereunder, and further provided that the Security, if any, has been transferred
to such transferee.
22.02. The term "Business Days" as used in this Lease shall exclude
Saturdays, Sundays and all days observed as legal holidays and defined as Public
Holidays in the Official Directory of
36
the City of New York as well as all other days recognized as holidays under
applicable union contracts.
22.03. The term "Interest Rate" shall mean a rate per annum equal to the
lesser of (a) 2% above the "base rate" of Citibank, N.A., as publicly announced
from time to time or if Citibank, N.A. shall cease to exist or cease to announce
such rate, any similar rate designated by Landlord which is publicly announced
from time to time by any other bank in the City of New York having combined
capital and surplus in excess of $100,000,000 or (b) the maximum rate of
interest, if any, which Tenant may legally contract to pay.
22.04. The term "Legal Requirements" shall mean laws, statutes and
ordinances including building codes and zoning regulations and ordinances and
the orders, rules, regulations, directives and requirements of all federal,
state, county, city and borough departments, bureaus, boards, agencies, offices,
commissions and other subdivisions thereof, or of any official thereof, or of
any other governmental, public or quasi-public authority, whether now or
hereafter in force, which may be applicable to the Premises or Building or the
demised premises or any part thereof, or the sidewalks, curbs or areas adjacent
thereto.
ARTICLE 23
INVALIDITY OF ANY PROVISION
23.01. If any term, covenant, condition or provision of this Lease or the
application thereof to any circumstance or to any person, firm or corporation
shall be invalid or unenforceable to any extent, the remaining terms, covenants,
conditions and provisions of this Lease shall not be affected thereby and each
remaining term, covenant, condition and provision of this Lease shall be valid
and shall be enforceable to the fullest extent permitted by law.
ARTICLE 24
BROKERAGE
24.01. Tenant and Landlord covenant, represent and warrant to the other
that each has had no dealings or negotiations with any broker or agent other
than Insignia/ESG, in connection with the consummation of this Lease, and each
party covenants and agrees to pay, hold harmless and indemnify the other from
and against any and all cost, expense (including reasonable attorneys' fees and
court costs), loss and liability for any compensation, commissions or charges
claimed by any broker or agent, other than the broker set forth in this Section
24.01, with respect to this Lease or the negotiation thereof if such claim or
claims by any such broker or agent are based in whole
37
or in part on dealing with the party from whom such indemnity is sought.
Landlord agrees to pay to the broker specified in this Section 24.01 such
compensation, commissions or charges to which it is entitled pursuant to the
separate agreement between said broker and Landlord.
ARTICLE 25
SUBORDINATION
25.01. This Lease is and shall be subject and subordinate to all ground or
underlying leases, including the Over Lease which may now or hereafter affect
the Premises or the Building and to all mortgages which may now or hereafter
affect such leases, the Premises or the Building, and to all renewals,
refinancings, modifications, replacements and extensions thereof (hereinafter
called "Superior Instruments"). The provisions of this Section 25.01 shall be
self-operative and no further instrument of subordination shall be required. In
confirmation of such subordination, Tenant shall promptly execute and deliver at
its own cost and expense any instrument, in recordable form if required, that
Landlord, the holder of any Superior Instrument or any of their respective
successors in interest may request to evidence such subordination.
25.02. In the event of a termination of any ground or underlying lease,
including the Over Lease, or if the interests of Landlord under this Lease are
transferred by reason of, or assigned in lieu of, foreclosure or other
proceedings for enforcement of any mortgage, or if the holder of any mortgage
acquires a lease in substitution therefor, then Tenant under this Lease may be
requested to, at the option to be exercised in writing by the holder of any such
Superior Instrument or any purchaser, assignee or lessee, as the case may be,
and if so requested shall, either (i) attorn to it and perform for its benefit
all the terms, covenants and conditions of this Lease on Tenant's part to be
performed with the same force and effect as if it were the landlord originally
named in this Lease, or (ii) enter into a new lease with it for the remaining
term of this Lease and otherwise on the same terms and conditions and with the
same options, if any, then remaining. The foregoing provisions of clause (i) of
this Section 25.02 shall enure to the benefit of such holder of a Superior
Instrument, purchaser, assignee or lessee, shall be self-operative upon the
exercise of such option, and no further instrument shall be required to give
effect to said provisions. Tenant, however, upon demand of any such holder of a
Superior Instrument, purchaser, assignee or lessee agrees to execute, from time
to time, instruments in confirmation of the foregoing provisions of this Section
25.02, reasonably satisfactory to any such holder of a Superior Instrument,
purchaser, assignee or lessee, acknowledging such attornment and setting forth
the terms and conditions of its tenancy.
25.03. Anything herein contained to the contrary notwithstanding, under no
circumstances shall any such holder of a Superior Instrument, purchaser,
assignee or lessee, as the case may be, whether or not it shall have succeeded
to the interests of Landlord under this Lease, be
(a) liable for any act, omission or default of any prior
landlord; or
38
(b) subject to any offsets, claims or defenses which the Tenant
might have against any prior landlord; or
(c) bound by any rent or additional rent which Tenant might have
paid to any prior landlord for more than one month in advance or for more than
three months in advance where such rent payments are payable at intervals of
more than one month; or
(d) bound by any modification, amendment or abridgment of this
Lease, or any cancellation or surrender of the same, made without its prior
written approval.
25.04. If, in connection with the financing of the Building, the holder of
any mortgage shall request reasonable modifications in this Lease as a condition
of approval thereof, Tenant will not unreasonably withhold, delay or defer
making such modifications provided the same do not (i) increase the fixed annual
rent or additional rents payable by Tenant (ii) reduce the Term hereof, (iii)
extend the Term hereof except as otherwise provided in Section 2.06, or (iv)
otherwise increase Tenant's obligations or reduce Tenant's rights under this
Lease except in an immaterial manner.
25.05. Upon execution of this Lease, Landlord shall request and use its
reasonable commercial efforts to obtain prior to the date which is thirty (30)
days after the date hereof, for the benefit of Tenant, a "non-disturbance
agreement" in the form then utilized by the holder of the Superior Instrument
(and Landlord shall seek to obtain any changes to such form as Tenant shall
reasonable request, but Landlord does not assure that any such changes shall be
obtained), provided, however, that the failure of Landlord to obtain such
non-disturbance agreement shall not be a default by Landlord nor shall such
failure affect this Lease.
ARTICLE 26
CERTIFICATE OF TENANT
26.01. Tenant shall, without charge, at any time and from time to time,
within ten (10) days after request by Landlord, execute, acknowledge and deliver
to Landlord, the holder of a Superior Instrument or any other person, firm or
corporation specified by Landlord, a written instrument (an "Estoppel
Certificate") in such form as may reasonably be required by Landlord or the
holder of any Superior Instrument.
26.02. Tenant agrees that, except for the first month's rent hereunder,
it will pay no rent under this Lease more than thirty (30) days in advance of
its due date, if so restricted by any existing or future Superior Instrument or
by an assignment of this Lease to the holder of such Superior Instrument, and,
in the event of any act or omission by Landlord which would give Ten-
39
ant the right to terminate this Lease, Tenant will not exercise such right until
Tenant shall have first given written notice of such act or omission to the
holder of any Superior Instrument who shall have furnished such holder's last
address to Tenant, and until a reasonable period, for remedying such act or
omission shall have elapsed following the giving of such notices, during which
time such holder shall have the right, but shall not be obligated, to remedy or
cause to be remedied such act or omission. Tenant further agrees not to exercise
any such right if the holder of any such Superior Instrument commences to cure
such act or omission within a reasonable time after having received notice
thereof and diligently prosecutes such cure thereafter.
26.03. Tenant shall, without charge, at any time and from time to time
deliver to Landlord within ten (10) days alter request therefor (a) copies of
the most current available financial statements of Tenant and of any guarantor
of Tenant's obligations under the Lease certified by an independent certified
public accountant and (b) such further detailed financial information with
respect to Tenant and any such guarantors as Landlord or the holder of any
Superior Instrument may reasonably request. Landlord and the holder of any
Superior Instrument shall hold such financial information in confidence and
shall not disclose same except as may be legally required.
ARTICLE 27
LEGAL PROCEEDINGS, WAIVER OF JURY TRIAL
27.01. Landlord and Tenant hereby 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 in connection with
this Lease, the relationship of Landlord and Tenant arising out of this Lease,
Tenant's use or occupancy of the demised premises, and/or any other claims
(except claims for personal injury or property damages), and any statutory
emergency or any other statutory remedy. It is further mutually agreed that in
the event Landlord commences any summary proceeding for non-payment of rent,
Tenant will not interpose and does hereby waive the right to interpose any
counterclaim of whatever nature or description in any such proceeding. Tenant
shall reimburse Landlord upon demand for all costs and expenses (including
attorney's fees and disbursements and court costs) incurred by Landlord in
connection with enforcing Tenant's obligations hereunder or in protecting
Landlord's rights hereunder whether incurred in connection with an action or
proceeding commenced by Landlord, by Tenant, or by a third party which third
party claim relates to any action or inaction by Tenant. All such amounts shall
be deemed to be additional rent and shall be collectible in the same manner as
provided in Section 1.02 hereof.
ARTICLE 28
SURRENDER OF PREMISES
40
28.01. Upon the expiration or other termination of the Term, Tenant shall
quit and surrender to Landlord the demised premises, broom clean, in good order
and in the condition required by this Lease (including restoration of the
demised premises to Building Standard, as required by the provisions of Section
6.04 of this Lease), ordinary wear and tear and damage by fire, the elements or
other casualty excepted, other than such damage caused by Tenant, and Tenant
shall remove all of its property as herein provided. Tenant's obligation to
observe or perform this covenant shall survive the expiration or other
termination of the Term.
28.02. If Tenant shall, without the written consent of Landlord, hold over
the expiration of the Term such tenancy shall be deemed a month-to-month
tenancy, which tenancy may be terminated as provided by applicable law. During
such tenancy, Tenant agrees to (a) pay to Landlord, each month, the greater of
the fair market rental value for the demised premises or one hundred twenty
(120) percent of the fixed annual rent and all additional rent payable by Tenant
for the last month of the Term and (b) be bound by all of the terms, covenants
and conditions herein specified except those pertaining to the Term. Nothing
contained in this Section 28.02 shall be deemed in limitation of Landlord's
rights and remedies against Tenant for Tenant's failure to have surrendered the
demised premises on or prior to the expiration of the Term.
ARTICLE 29
RULES AND REGULATIONS
29.01. Tenant and Tenant's servants, employees, agents, licensees,
invitees, visitors and patrons shall observe faithfully and comply strictly with
such Rules and Regulations as Landlord or Landlord's agents may from time to
time reasonably adopt, provided, however, that in case of any conflict or
inconsistency between the provisions of this Lease and of any of the Rules and
Regulations as originally or as hereafter adopted, the provisions of this Lease
shall control. Reasonable written notice of any additional Rules and Regulations
shall be given to Tenant.
Nothing in this Lease contained shall be construed to impose upon
Landlord any duty or obligation to enforce the Rules and Regulations or the
terms, covenants or conditions in any other lease, against any other tenant of
the Building, and Landlord shall not be liable to Tenant for violation of the
same by any other tenant, its servants, employees, agents, visitors or
licensees. Landlord shall not discriminate against Tenant in connection with the
enforcement of such Rules and Regulations.
ARTICLE 30
CONSENTS AND APPROVALS
30.01. Wherever in this Lease Landlord's consent or approval is required,
if Landlord shall
41
delay or refuse such consent or approval, Tenant in no event shall be entitled
to make, nor shall Tenant make, any claim, and Tenant hereby waives any claim,
for money damages (nor shall Tenant claim any money damages by way of set-off,
counterclaim or defense) based upon any claim or assertion by Tenant that
Landlord unreasonably withheld or unreasonably delayed its consent or approval.
Tenant's sole remedy shall be an action or proceeding to enforce any such
provision, for specific performance, injunction or declaratory judgment.
ARTICLE 31
NOTICES
31.01. Any notice or demand, consent, approval or disapproval, or statement
(collectively called "Notices") required or permitted to be given by the terms
and provisions of this Lease, or by any law or governmental regulation, either
by Landlord to Tenant or by Tenant to Landlord, shall be in writing and unless
otherwise required by such law or regulation, shall be sent by United States
mail postage prepaid as registered or certified mail, return receipt requested.
Any Notice shall be addressed to Landlord at its address set forth on page 1 of
this Lease with a copy to David S. Lester, Esq., 1129 Northern Boulevard,
Manhasset, New York 11030 and any notice to Tenant shall be sent to Tenant at
130 West Union Street, Pasadena, California, 91103 Attn: Mr. Brad Ramberg. After
Tenant shall occupy the demised premises, the address of Tenant for Notices
shall be the Building, attention Mr. Howard Morgan, with a copy to the above
address of Tenant. By giving the other party at least ten days prior written
notice, either party may, by Notice given as above provided, designate a
different address or addresses for Notices.
31.02 Any Notice shall be deemed given as of the date of delivery as
indicated on the return receipt; and in the case of failure to deliver by reason
of changed address of which no Notice was given or refusal to accept delivery,
as of the date of such failure as indicated on the return receipt or by notice
of the postal department.
31.03. In addition to the foregoing, either Landlord or Tenant may, from
time to time, request in writing that the other party serve a copy of any Notice
on one other person or entity designated in such request, such service to be
effected as provided in Section 31.01 hereof.
ARTICLE 32
NO WAIVER
32.01. No agreement to accept a surrender of this Lease shall be valid
unless in writing signed by Landlord. No employee of Landlord or of Landlord's
agents shall have any power to accept the keys of the demised premises prior to
the termination of this Lease. The
42
delivery of keys to any employee of Landlord or of Landlord's agent shall not
operate as a termination of this Lease or a surrender of the demised premises.
In the event of Tenant at any time desiring to have Landlord sublet the premises
for Tenant's account, Landlord or Landlord's agents are authorized to receive
said keys for such purpose without releasing Tenant from any of the obligations
under this Lease. The failure of Landlord to seek redress for violation of, or
to insist upon the strict performance of, any covenant or condition of this
Lease or, as to Landlord, any of the Rules and Regulations set forth herein or
hereafter adopted by Landlord, shall not prevent a subsequent act, which would
have originally constituted a violation, from having all the force and effect of
an original violation. The receipt by Landlord of rent with knowledge of the
breach of any covenant of this Lease shall not be deemed a waiver of such
breach. The failure of Landlord to enforce any of the Rules and Regulations set
forth herein, or hereafter adopted, against Tenant and/or any other tenant in
the Building shall not be deemed a waiver of any such Rules and Regulations. No
provision of this Lease shall be deemed to have been waived by Landlord, unless
such waiver be in writing signed by such party. No payment by Tenant or receipt
by Landlord of a lesser amount than the monthly rent herein stipulated shall be
deemed to be other than on the account of the earliest stipulated rent, nor
shall any endorsement or statement on any check or any letter accompanying any
check or payment of rent be deemed an accord and satisfaction, and Landlord may
accept such check or payment without prejudice to Landlord's right to recover
the balance of such rent or pursue any other remedy in this Lease provided and
Tenant may deliver such check without prejudice to Tenant's right to pursue any
other remedy.
32.02. This Lease contains the entire agreement between the parties, and
any executory agreement hereafter made shall be ineffective to change, modify,
discharge or effect an abandonment of it in whole or in part unless such
executory agreement is in writing and signed by the party against whom
enforcement of the change, modification, discharge or abandonment is sought.
ARTICLE 33
CAPTIONS
33.01. The captions are inserted only as a matter of convenience and for
reference, and in no way define, limit or describe the scope of this Lease nor
the intent of any provision hereof.
ARTICLE 34
INABILITY TO PERFORM
34.01. If, by reason of (1) strike, (2) labor troubles, (3) governmental
preemption in connection with a national emergency, (4) any rule, order or
regulation of any governmental
43
agency, (5) conditions of supply or demand which are affected by war or other
national, state or municipal emergency, or any other cause or (6) any cause
beyond Landlord's reasonable control, Landlord shall be unable to fulfill its
obligations under this Lease or shall be unable to supply any service which
Landlord is obligated to supply, this Lease and Tenant's obligation to pay rent
hereunder shall in no wise be affected, impaired or excused.
ARTICLE 35
NO REPRESENTATIONS
35.01. Landlord or Landlord's agents have made no representations or
promises with respect to the Building or demised premises except as herein
expressly set forth.
ARTICLE 36
SECURITY DEPOSIT
36.01. Tenant shall deposit with Landlord upon execution hereof any of, or
a combination of, (i) cash; (ii) an irrevocable and unconditional sight draft
letter of credit which shall provide that it may be drawn upon the unilateral
action of Landlord, in form and substance and issued by a banking institution
acceptable to Landlord; or (iii) negotiable securities listed on any of the
NYSE, AMEX or Nasdaq National Market, aggregating an initial amount equal to
$3,500,000, (which negotiable securities must be immediately convertible to cash
as a result of the unilateral action of Landlord, and which cash must be
immediately available to Landlord), as security for the full and faithful
performance and observance by Tenant of Tenant's covenants and obligations under
this Lease (the "Security"). Any letter of credit shall be renewed annually by
Tenant not less than 30 days prior to its expiration. The Security shall at all
times be equal to the following amount:
LEASE YEARS AMOUNT
----------- ------
1-3 $3,500,000
4 2,800,000
5 2,100,000
6 1,400,000
7 700,000
8 through 10 350,000
11 and thereafter 0
In the event Tenant fails to timely renew any letter of credit, notwithstanding
any other provision contained in this Lease to the contrary, Landlord may
immediately draw upon the existing letter of
44
credit without notice to Tenant. Should Tenant default in respect of any of the
terms, provisions and conditions of this Lease beyond any applicable cure
period, including, but not limited to, the payment of fixed annual rent and
additional rent, Landlord may use, apply or retain the whole or any part of the
Security (including selling any securities) to the extent required for the
payment of any fixed annual rent and additional rent or any other sum as to
which Tenant is so in default or for any sum which Landlord may expend or may be
required to expend by reason of such Tenant's default in respect of any of the
terms, covenants and conditions of this Lease, including but not limited to, any
damages or deficiency accrued before or after summary proceedings or other
re-entry by Landlord, or any costs or expenses incurred in connection with
restoring the demised premises to Building Standard as set forth in Section 6.04
of this Lease. Any income or other taxes imposed on the sale of such securities
shall be the exclusive liability and responsibility of Tenant, and Tenant hereby
indemnifies and holds Landlord harmless from and against any such taxes and any
interest or penalties thereon. In the event of a sale of the demised premises
and Building, Landlord shall transfer the Security to the vendee and Landlord
shall thereupon be released by Tenant from all liability for the return of such
Security, and Tenant agrees to look to the new Landlord solely for the return of
said Security; and it is agreed that the provisions hereof shall apply to every
transfer or assignment made of the Security to a new landlord.
36.02 If Landlord shall use, apply or retain the whole or any part of the
Security, or should the market value of the securities comprising the Security
fall so that the Security on hand shall be less than 95% of the required
Security, as set forth in Section 36.01, Tenant shall, upon demand, immediately
increase the Security held by Landlord to the amount then required hereunder.
36.03 Landlord shall pay the bank fee for any letter of credit obtained by
Tenant as part or all of the Security.
36.04 Landlord shall execute such documents and take such other reasonable
actions, without any out of pocket expense to Landlord, as shall be necessary to
enable Tenant to reduce the Security as set forth in Section 36.01.
ARTICLE 37
ARBITRATION
37.01. In each case specified in this Lease in which resort to arbitration
shall be required, such arbitration (unless otherwise specifically provided in
other Sections of this Lease) shall be in New York City in accordance with the
Commercial Arbitration Rules of the American Arbitration Association and the
provisions of this Lease. The decision and award of the arbitrators shall be in
writing, shall be final and conclusive on the parties, and counterpart copies
thereof shall be delivered to each of the parties. In rendering such decision
and awards, the arbitrators shall not
45
add to, subtract from or otherwise modify the provisions of this Lease. Judgment
may be had on the decision and award of the arbitrators so rendered in any court
of competent jurisdiction.
ARTICLE 38
INDEMNITY
38.01. Tenant shall indemnify Landlord and save it harmless from and
against any and all liability, damages, costs or expenses, including attorneys'
fees, arising from any misconduct or negligence of Tenant, its sublessees or
assignees, and the officers, contractors, licensees, agents, employees, guests,
invitees, or visitors of Tenant or its sublessees or assignees, in or about the
Building or arising from any breach or default under this Lease by Tenant or its
sublessees or assignees, or arising from any accident, injury, or damage,
howsoever and by whomsoever caused, but involving Tenant or its sublessees or
assignees, or the officers, contractors, licensees, agents, employees, guests,
invitees or visitors of Tenant or its sublessees or assignees, occurring in or
about the Building or the Premises. This provision shall not be construed to
make Tenant responsible for loss, damage, liability or expense resulting from
injuries to third parties caused by the negligence or intentional misconduct of
Landlord, or its officers, contractors, licensees, agents, employees or
invitees.
ARTICLE 39
MEMORANDUM OF LEASE
39.01. Tenant shall, at the request of Landlord, execute and deliver a
statutory form of memorandum of this Lease for the purpose of recording, but
said memorandum of this Lease shall not in any circumstances be deemed to modify
or to change any of the provisions of this Lease.
ARTICLE 40
SIGNS
40.01. Tenant shall not erect or install any signs in the Building or on
the Premises, unless such signs have been approved in writing by Landlord, such
approval not to be unreasonably withheld or delayed. It is understood and agreed
that Landlord will not approve any sign if, in Landlord's sole judgment, such
sign does not conform to the decor and character of the Building.
Notwithstanding the foregoing, Tenant may install signs within the demised
premises relating to Tenant's various business divisions and other business
activities.
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ARTICLE 41
ADDITIONAL SPACE
41.01. Tenant hereby leases from Landlord a portion of the basement of the
Building (as shown on Exhibit D annexed hereto) ("Additional Space"), commencing
February 1, 2002. Effective February 1, 2002, the Additional Space shall be
delivered to Tenant vacant, broom clean, free of rights of tenants and
occupants, and with the work set forth on Exhibit B, paragraph 2, substantially
completed, the Lease of the Additional Space shall be included in this Lease,
the Additional Space shall be included within the defined term "demised
premises" and the Additional Space shall be governed by and subject to all of
the terms and conditions of this Lease, and further, effective February 1, 2002,
the fixed annual rent, as previously escalated by Section 1.01B, shall be
increased by $1,100,000, which $1,100,000 shall be also subject, from and after
the date of this Lease, to escalation pursuant to Section 1.01B. Landlord shall
provide Tenant with $440,000 in connection with Tenant's work in the basement
space, to be paid in accordance with the provisions of Section 6.09. There shall
be no increase in Tenant's Tax Share as a result of Tenant leasing the
Additional Space.
41.02. Provided that Young & Rubicam Inc. ("YR"), the current tenant on the
fourth floor, has not exercised its right to renew its lease for the fourth
floor by YR giving notice thereof to Landlord on or before June 1, 2002 (or YR
has otherwise formally lost or waived in writing such right), and provided
Tenant is then a tenant in the Building and is not in default under this Lease
beyond any grace period, Tenant shall have one option (the "Fourth Floor Space
Option") to lease from Landlord, effective June 1, 2003 (the "Fourth Floor
Effective Date"), all of the fourth floor of the Building, as shown on Exhibit E
annexed hereto ("Fourth Floor Space"). The Fourth Floor Space Option shall be
exercised by Tenant giving Landlord notice ("Fourth Floor Notice") of its
exercise of the Fourth Floor Space Option, on or before 30 days, time of the
essence, after Landlord has given Tenant notice that YR has not exercised YR's
renewal option or that YR has formally lost or waived in writing such right).
Upon the giving of the Fourth Floor Notice and the occurrence of the Fourth
Floor Effective Date, the lease of the Fourth Floor Space shall be included in
this Lease, the Fourth Floor Space shall be included within the defined term
"demised premises", the Fourth Floor Space shall be governed by and subject to
all of the terms and conditions of this Lease, and further, effective June 1,
2003:
(a) the fixed annual rent, as escalated by Section 1.01B, shall
be increased by 100%;
(b) Tenant's Tax Share shall be increased to 33.66%; and
(c) with respect to any other charge or expense for which Tenant
is
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responsible for its proportionate or pro rata share, such
share shall be increased to 33.66%.
41.03. If Tenant shall not timely exercise the Fourth Floor Space Option,
Tenant's rights under Section 41.02 shall terminate.
41.04 Provided that YR has not exercised its right to renew its Lease for
the basement space as shown on Exhibit F hereto, by giving notice thereof to
Landlord on or before June 1, 2002 (or YR has otherwise formally lost or waived
in writing such right), and provided Tenant is then a tenant in the Building and
is not in default under this Lease beyond any grace period, Tenant shall have
one option (the "Additional Basement Option") to lease from landlord, effective
June 1, 2003 (the "Additional Basement Effective Date"), the basement space, as
shown on Exhibit F annexed hereto ("Additional Basement Space"). The Additional
Basement Option shall be exercised by Tenant giving Landlord notice ("Additional
Basement Notice") of its exercise of the Additional Basement Option, on or
before 30 days, time of the essence, after Landlord has given Tenant notice that
YR has not exercised YR's renewal option or YR has otherwise formally lost or
waived in writing such right. Upon the giving of the Additional Basement Notice
and the occurrence of the Additional Basement Effective Date, the lease of the
Additional Basement Space shall be included in this Lease, the Additional
Basement Space shall be included within the defined term "demised premises", the
Additional Basement Space shall be governed by and subject to all of the terms
and conditions of this Lease, and further, effective June 1, 2003, the fixed
annual rent, as escalated by Section 1.01B, shall be increased by $72,690;
41.05 If Tenant shall not timely exercise the Additional Basement Option,
Tenant's rights under Section 41.04 shall terminate.
41.06 The commencement date of the renting of each of the additional spaces
referred to in this Article 41 shall only occur upon Landlord delivering the
applicable space to Tenant, vacant, broom clean and free of tenancies, and upon
substantial completion of any work required to be performed by Landlord as set
forth on Exhibit B hereto.
ARTICLE 42
RENEWAL OPTION
42.01. If Tenant is not in default under this Lease beyond any applicable
notice and cure periods, Tenant shall have an option (the "Option") to extend
the term of the Lease for two (2) additional terms of five (5) years each (each,
a "Renewal Term") commencing on the first day next succeeding the Expiration
Date upon the same terms, conditions and provisions as are provided for in this
Lease other than the provisions of this Article 42, except that the fixed annual
rent payable for the Renewal Term shall be the greater of (i) the fixed annual
rent payable thereunder immediately prior to the Expiration Date or (ii) the
fair market rent for the demised
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premises as of such Expiration Date determined in the manner hereinafter
provided. Tenant may not exercise the second renewal option referred to above
unless the first renewal option has been exercised.
42.02. The Option shall be exercised by Tenant giving written notice to
Landlord of Tenant's exercise of said Option by certified mail, return receipt
requested, not less than eighteen (18) months prior to the expiration of the
Term then in effect (the "Exercise Notice"). Upon Tenant's giving of the
Exercise Notice, the term of this Lease shall be extended automatically upon the
terms and conditions herein specified, including, without limitation, the same
Base Tax set forth in Article 3 hereof, without the execution of an extension
agreement or other instrument. If Tenant shall not give Landlord the Exercise
Notice at the time and in the manner set forth above, the Option shall terminate
and be deemed waived by Tenant. Time is of the essence as to the date for the
giving of the Exercise Notice.
42.03. After Landlord receives the Exercise Notice, and if in Landlord's
opinion an increase in the fixed annual rent for the Renewal Term is warranted
because the fair market rent for the demised premises has increased, Landlord
shall within 90 days after Landlord receives the Exercise Notice, send Tenant a
notice (the "Revised Rent Notice") stating the amount which, in Landlord's
opinion, shall constitute the fair market rent for the demised premises as of
the Expiration Date. The increased fixed annual rent set forth in the Revised
Rent Notice shall be effective as of the first day of the Renewal Term.
42.04. (a) If Landlord gives a Revised Rent Notice, then at any time within
30 days after the giving of such Revised Rent Notice, Tenant may dispute the
fair market rent for the demised premises as determined by Landlord by giving
notice to Landlord that it is initiating the appraisal process provided for
herein and specifying in such Notice the name and address of the arbitrator
designated by Tenant to act on its behalf. Within 15 days after the designation
of Tenant's arbitrator, Landlord shall give notice to Tenant specifying the name
and address of Landlord's arbitrator. The two arbitrators so chosen shall meet
within 10 days after the second arbitrator is appointed and if, within 20 days
after the second arbitrator is appointed, the two arbitrators shall not agree
upon a determination in accordance with Paragraph (c) of this Section 42.04 they
shall together appoint a third arbitrator. If said two arbitrators cannot agree
upon the appointment of a third arbitrator within 10 days after the expiration
of such 20 day period, or if either party shall not timely designate its initial
arbitrator, then either party, on behalf of both, and on notice to the other may
request such appointment by the American Arbitration Association (or any
successor organization) in accordance with its then prevailing rules. If the
American Arbitration Association shall fail to appoint said third arbitrator
within 10 days after such request is made, then either party may apply, on
notice to the other, to the Supreme Court, New York County, New York (or any
other court having jurisdiction and exercising functions similar to those now
exercised by the foregoing court) for the appointment of such third arbitrator.
(b) Each of the arbitrators selected as herein provided shall have at
least
49
fifteen years experience in the leasing or management of space in the Borough of
Manhattan. Each party shall pay the fees and expenses of the arbitrator selected
by it. The fees and expenses of the third arbitrator and all other expenses (not
including the attorney's fees, witness fees and similar expenses of the parties
which shall be borne separately by each of the parties) of the arbitration shall
be borne equally by the parties hereto.
(c) The majority of the arbitrators shall determine the fair market
rent of the demised premises as of the Expiration Date and render a decision and
award as to their determination to both Landlord and Tenant within 20 days after
the appointment of the third arbitrator. In no event however, may such fair
market rent be determined by the arbitrators to be less than the fixed annual
rent payable under this Lease immediately prior to the Expiration Date. In
rendering such decision and award, the arbitrators shall assume or take into
consideration as appropriate all of the following: (i) the Landlord and
prospective tenant are typically motivated; (ii) the Landlord and prospective
tenant are well informed and well advised and each is acting in what it
considers its own best interest; (iii) a reasonable time under then-existing
market conditions is allowed for exposure of the demised premises on the open
market; (iv) the rent is unaffected by concessions, special financing amounts
and/or terms, or unusual services, fees, costs or credits in connection with the
leasing transaction; (v) the demised premises are fit for immediate occupancy
and use "as is" and require no additional work by Landlord and that no work has
been carried out thereon by the Tenant, its subtenant, or their predecessors in
interest during the Term which has diminished the rental value of the demised
premises; (vi) in the event the demised premises have been destroyed or damaged
by fire or other casualty, they have been fully restored; (vii) the demised
premises are to be let with vacant possession and subject to the provisions of
this Lease for a 15 year term; and (viii) market rents then being charged for
comparable space in other similar office buildings in the same area. In
rendering such decision and award, the arbitrators shall not modify the
provisions of this Lease. The decision and award of the arbitrators shall be in
writing and be final and conclusive on all parties and counterpart copies
thereof shall be delivered to each of said parties. Judgment may be had on the
decision and award of the arbitrators so rendered in any court of competent
jurisdiction.
(d) Prior to the determination of the arbitrators, Tenant shall pay
as the fixed annual rent it is obligated to pay under this Lease the amount set
forth in the Revised Rent Notice and in the event the arbitrators determine that
the fixed annual rent payable pursuant to this Article 42 is greater than that
set forth in the Revised Rent Notice, then Tenant shall promptly pay to Landlord
the amount of its underpayment of fixed annual rent for the period commencing on
the first day of the Renewal Term, or if the arbitrators determine that the
fixed annual rent payable pursuant to this Article 42 is less than that set
forth in the Revised Rent Notice, then Tenant shall be entitled to a credit in
the amount of its overpayment for the period commencing on the first day of the
Renewal Term against subsequent payments of fixed annual rent due hereunder.
(e) Nothing contained in this Article 42 shall be deemed in any way
to alter or modify the provisions of Article 3 hereof.
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(f) In no event shall the fixed annual rent (as the same may have
been increased from time to time in accordance with this Article 42) be reduced
pursuant to this Article 42.
42.05. Notwithstanding the foregoing provisions of this Article 42, if on
the date that Tenant exercises the Option, or if on any subsequent date up to
and including the date upon which the extension of the term commences, Tenant is
in default, beyond any applicable notice and grace periods, in the payment of
fixed annual rent, additional rent, or in the performance of any of the other
terms, conditions or provisions of this Lease, Tenant's exercise of such Option
and the extension of the Term covered by this Lease contemplated thereby shall,
at the option of Landlord exercised by written notice to Tenant, be rendered
null and void and shall be of no further force and effect and Tenant shall have
no other additional right to exercise such option, which shall be deemed waived
by Tenant.
42.06. If Tenant exercises the Option, then, at Landlord's request, Tenant
agrees within ten (10) days after such request is made to execute, acknowledge
and deliver to Landlord an instrument in form and substance satisfactory to
Landlord, confirming (i) the fixed annual rent payable under this Lease pursuant
to Article 42, unless Tenant is then, in good faith, disputing same in
accordance with the provision of this Article 42, in which case Tenant agrees to
execute, acknowledge and deliver a separate instrument satisfactory to Landlord
confirming the fixed annual rent as finally determined, (ii) the expiration date
of the Term, and (iii) the other modifications provided for in this Article 42,
but no such instrument shall be required in order to make the provisions hereof
effective.
42.07 Notwithstanding the other provisions of this Article 42, if Tenant
shall be the tenant of the fifth floor and the Additional Space, Tenant may
elect in its Exercise Notice which of the floor(s) the Renewal Term shall apply
to, provided, however, that Tenant may only lease full floors (no partial floors
other than the Additional Space) and may not lease any of the basement if Tenant
has not elected to lease at least one full floor other than the basement. If
Tenant makes the election under this Section 42.07, the fixed annual rent and
additional rent shall be determined only with respect to the premises which
Tenant has elected the Renewal Term to apply to.
ARTICLE 43
THIRD FLOOR
43.01. Provided Tenant is then a tenant in the Building and is not in
default beyond any applicable notice and grace period, if Landlord shall have
available for rental any space on the third floor of the Building, or if
Landlord shall be aware that such space in the Building is
51
becoming available to be put on the market, Landlord shall give notice (the
"Notice") to Tenant, and Landlord and Tenant shall meet to discuss Tenant
renting the third floor. Neither Landlord nor Tenant shall be obligated to enter
into any Lease for such third floor. If Landlord and Tenant shall not agree on
the terms and conditions of such third floor rental and enter into a Lease for
such third floor within said 30 day period, time being of the essence, Tenant's
rights under this Article 43 shall terminate. Tenant's right hereunder shall not
apply to any renewal, extension or new lease with a tenant in the building
relating to space then occupied by said tenant.
ARTICLE 44
MISCELLANEOUS
44.01. Irrespective of the place of execution or performance, this Lease
shall be governed by and construed in accordance with the laws of the State of
New York.
44.02. This Lease shall be construed without regard to any presumption or
other rule requiring construction against the party causing this Lease to be
drafted.
44.03. Except as otherwise expressly provided in this Lease, each covenant,
agreement, obligation or other provision of this Lease on Tenant's part to be
performed shall be deemed and construed as a separate and independent covenant
of Tenant, not dependent on any other provision of this Lease.
44.04. All terms and words used in this Lease, regardless of the number or
gender in which they are used, shall be deemed to include any other number and
any other gender as the context may require.
44.05. Time shall be of the essence with respect to the exercise of any
Option on the part of Tenant to extend the term of this Lease.
44.06. Except as otherwise provided herein, whenever payment of interest is
required by the terms hereof it shall be at the Interest Rate.
44.07. Subject to the provisions of Section 1.01, if the demised premises
or any additional space to be included within the demised premises shall not be
available for occupancy by Tenant on the specific date hereinbefore designated
for the commencement of the Term of this Lease or for the inclusion of such
space for any reason whatsoever, then this Lease shall not be affected thereby
but, in such case, said specific date shall be deemed to be postponed until the
date when the demised premises or such additional space shall be available for
occupancy by Tenant, and Tenant shall not be entitled to possession of the
demised premises or such additional space until the same are available for
occupancy by Tenant; provided, however, that Tenant shall have no
52
claim against Landlord, and Landlord shall have no liability to Tenant by reason
of any such postponement of said specific date, and the parties hereto further
agree that any failure to have the demised premises or such additional space
available for occupancy by Tenant on said specific date or on the Commencement
Date shall in no wise affect the obligations of Tenant hereunder nor shall the
same be construed in any wise to extend the Term. This Section 44.07 shall be
deemed to be an express provision to the contrary of Section 223-a of the Real
Property Law of the State of New York and any other law of like import now or
hereinafter in force.
44.08. In the event that Tenant is in arrears in payment of fixed annual
rent or additional rent hereunder, Tenant waives Tenant's right, if any, to
designate the items against which any payments made by Tenant are to be
credited, and Tenant agrees that Landlord may apply any payments made by Tenant
to any items it sees fit, irrespective of and notwithstanding any designation or
request by Tenant as to the items against which any such payments shall be
credited.
44.09. All Exhibits referred to in this Lease are hereby incorporated in
this Lease by reference.
44.10. The covenants, conditions and agreements contained in this Lease
shall bind and inure to the benefit of Landlord and Tenant and their respective
heirs, distributees, executors, administrators, successors, and except as
otherwise provided in this Lease, their assigns.
44.11. No remedy or election hereunder shall be deemed exclusive but shall,
whenever possible, be cumulative with all other remedies at law or in equity.
44.12 This Lease supercedes all prior agreements, whether oral or written,
between Landlord and Tenant, which prior agreements are null and void.
44.13 Landlord represents to Tenant that, as of the date of this Lease, the
Over Lease is in full force and effect and Landlord is the tenant thereunder,
and that Landlord is not aware of any uncured default under said Over Lease and
Landlord has not exercised any right to terminate the Over Lease. Landlord
agrees that it will not amend the Over Lease if such amendment would materially
and adversely effect Tenant's rights under this Lease, nor shall Landlord
terminate the Over Lease. Landlord further agrees that it will use its
reasonable efforts (without incurring any out of pocket cost), to encourage
Mattel, Inc. ("Mattel"), the existing tenant on the Fifth Floor, to timely
vacate from the demises premises. If Mattel shall not so vacate by July 1, 2000,
or if Landlord's Work shall not be substantially completed by July 1, 2000, due
to no fault of Tenant, Tenant may cancel this Lease by written notice to
Landlord given before July 10, 2000, time of the essence. If such cancellation
notice is not given before July 10, 2000, Tenant's right to cancel this Lease
shall be null and void. If Tenant cancels this Lease pursuant to this Section
44.14, Landlord shall return the advance rent payment and the Security to
Tenant.
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44.14 Within 90 days after Mattel, Inc. shall vacate from the entire
Building, including from the basement, Landlord shall arrange to remove the
floor tiles in which Mattel, Inc. has engraved its name, and replace such tiles
with reasonably matching tiles. Tenant shall have the right, at Tenant's sole
cost and expense, to have its name engraved in the new replacement tiles.
44.15 This Lease may be executed in counterparts.
44.16 Landlord agrees that it will use its reasonable efforts (without
incurring any out of pocket cost), to encourage YR (as defined in Exhibit B),
the existing tenant on the fourth floor and a portion of the basement, to timely
vacate from the demises premises.
INTENTIONALLY BLANK
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IN WITNESS WHEREOF, Landlord and Tenant have respectively executed this Lease as
of the day and year first above written.
675 OWNERSHIP LLC, Landlord
By: 675 Managing Member Corp.
By:
---------------------------
Israel Taub, President
BILL GROSS' IDEALAB!, Tenant
By:
--------------------------
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EXHIBIT B
1. Provided Tenant has advised Landlord in writing prior to January 18,
2000 as to the specific partitions and walls within the fifth floor which Tenant
requires Landlord to demolish, Landlord shall, on or before the Commencement
Date, perform such demolition and deliver the demised premises to Tenant in
vacant and broom clean condition, with the Building's sprinkler, mechanical and
hvac systems in good working order, except to the extent Tenant has made any
changes thereto. If Tenant shall not so advise by January 18, 2000, TIME OF THE
ESSENCE, Landlord shall be released of all demolition obligations set forth in
the preceding sentence. In addition, on or before the Commencement Date,
Landlord shall remove the stairs between the fifth and sixth floors and slab
over the opening. Such slab shall meet fifth floor floor load and shall be
reasonably smooth in finish. Additionally, Landlord shall deliver ACP-5
Certificates to Tenant prior to the Commencement Date.
2. Provided Tenant has advised Landlord in writing prior to June 1, 2001 as
to the specific partitions and walls within the Additional Space which Tenant
requires Landlord to demolish, Landlord shall perform such demolition and
deliver the Additional Space to Tenant in vacant and broom clean condition, on
or before February 1, 2002. If Tenant shall not so advise by June 1, 2001, TIME
OF THE ESSENCE, Landlord shall be released of all obligations as set forth on
this Exhibit B as to the Additional Space. Landlord shall reasonably cooperate
with Tenant with respect to plans and information concerning the installations
existing in the Additional Space, but Landlord shall incur no out of pocket
expense with respect thereto.
3. Provided YR is obligated under its lease to perform such demolition, and
provided Tenant has advised Landlord in writing in sufficient time to enable
Landlord to require YR to do so, as to the specific partitions and walls within
the Fourth Floor Space which Tenant requires Landlord to demolish, Landlord
shall require YR to perform such demolition and Landlord shall deliver the
Fourth Floor Space to Tenant in vacant and broom clean condition, on or before
such date as is reasonably and mutually agreed to by Landlord and Tenant.
Landlord will keep Tenant reasonable informed as to the status of YR's rights
with respect to the Fourth Floor Space and the requirements of Landlord as to
the timing of Tenant's furnishing of information with respect to the demolition
to be performed in the Fourth Floor Space. If Tenant shall not so timely advise
Landlord, TIME OF THE ESSENCE, Landlord shall be released of all obligations as
set forth on this Exhibit B as to the Fourth Floor Space. Landlord shall
reasonably cooperate with Tenant with respect to plans and information
concerning the installations existing in the Fourth Floor Space, but Landlord
shall incur no out of pocket expense with respect thereto.
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