Common use of Effect of Lease Severance on Outstanding Alterations Payables Clause in Contracts

Effect of Lease Severance on Outstanding Alterations Payables. Section 8.1(b) (relating to Outstanding Alterations Payables) shall be deleted in all Severed Leases in its entirety, and replaced with the following provisions (with references to “Landlord”, “Tenant”, the “Lease” and the “Property”, respectively, under such provisions, being deemed to refer to the applicable Severed Landlord, Severed Tenant, Severed Lease and Severed Property subject to the applicable Severed Lease): “Any request for Landlord’s consent to an Alteration under this Section 8.1(b) shall be accompanied by an Officer’s Certificate, pursuant to which Tenant shall certify either (i) that the Tangible Net Worth of the Lease Guarantors equals or exceeds the Reference Net Worth and specifying such Tangible Net Worth, (ii) that, in connection with the applicable Alteration or any other Alterations at the Property (or any other Properties subject to this Lease), no payables accrued by Tenant with respect to such Alteration(s) (excluding, for the avoidance of doubt, any payables that are the subject of a bona fide dispute conducted in accordance with any applicable provisions of Section 4.2) (collectively, “Alterations Payables”) are more than sixty (60) days past due (and promptly following Landlord’s written request, Tenant shall provide any back-up documentation reasonably requested by Landlord with respect to such accrued payables), or (iii) that if Landlord requests the same, Tenant shall post security for the applicable Alteration as described below. In the event that Tenant fails to deliver a certification that complies with either clause (i) or clause (ii) above by the date that Landlord’s consent to the applicable Alteration is required, Landlord may condition its consent thereto upon Tenant’s agreement to deposit cash with a nationally recognized Title Company or another nationally recognized institutional third party depository selected by Landlord and reasonably approved by Tenant in an amount equal to one hundred ten percent (110%) of the cost of such Alteration (as reasonably estimated by Tenant and supported by any back-up documentation reasonably requested by Landlord, provided that in all events Tenant’s policies and practices for accruing amounts constituting Alterations Payables shall be consistent with the policies and practices of the Tenant Parties with respect to their other accounts payable) that is the subject of such request for Landlord’s consent, which cash shall be disbursed to Tenant periodically in the manner, and subject to similar conditions, as the Restoration Conditions, as applicable; provided, however, that (A) such cash shall be made available to Landlord for the completion of such Alteration in the event that Tenant fails to complete the same in accordance with the terms and conditions of this Lease and such failure continues beyond any applicable notice and cure periods, (B) in the event Tenant is completing such Alterations in accordance with the applicable terms and conditions of this Lease, amounts may, pursuant to an escrow arrangement reasonably acceptable to the Parties, be disbursed to Tenant periodically in the manner, and subject to similar conditions, as the Restoration Conditions, as applicable, and (C) following the completion of such Alteration by Tenant, any remaining deposited amount returned to Tenant upon the completion of such Alteration in accordance with the terms and conditions of this Lease so long as no Disabling Event then exists. Alternatively, Tenant may elect to deposit cash with Landlord (or, at Tenant’s option, to deliver to Landlord an irrevocable standby letter of credit in form and substance reasonably acceptable to Landlord and issued by a Qualified Financial Institution or other financial institution reasonably acceptable to Landlord), in each case in an amount equal to one hundred ten percent (110%) of the cost of such Alteration, which cash or letter of credit (1) may be drawn by Landlord for the completion of such Alteration in the event Tenant fails to complete the same in accordance with the applicable terms and conditions of this Lease and such failure continues beyond any applicable notice and cure periods, (2) in the event Tenant is completing such Alterations in accordance with the applicable terms and conditions of this Lease, Landlord shall, to the extent such letter of credit permits partial draws, permit partial amounts to be disbursed to Tenant periodically, pursuant to an escrow arrangement acceptable to Landlord, in the manner, and subject to similar conditions, as the Restoration Conditions, as applicable, and (3) shall be returned to Tenant upon the completion of such Alteration in accordance with such terms and conditions so long as no Disabling Event then exists.” In connection with the foregoing, all references to “Outstanding Alterations Payables” and the “Outstanding Alterations Payables Threshold” shall be deleted in Severed Leases.

Effect of Lease Severance on Outstanding Alterations Payables. Section 8.1(b) (relating to Outstanding Alterations Payables) shall be deleted in all Severed Leases in its entirety, and replaced with the following provisions (with references to “Landlord”, “Tenant”, the “Lease” and the “Property”, respectively, under such provisions, being deemed to refer to the applicable Severed Landlord, Severed Tenant, Severed Lease and Severed Property subject to the applicable Severed Lease): “Any request for Landlord’s consent to an Alteration under this Section 8.1(b) shall be accompanied by an Officer’s Certificate, pursuant to which Tenant shall certify either (i) that the Tangible Net Worth of the Lease Guarantors equals or exceeds the Reference Net Worth and specifying such Tangible Net Worth, (ii) that, in connection with the applicable Alteration or any other Alterations at the Property (or any other Properties subject to this Lease), no payables accrued by Tenant with respect to such Alteration(s) (excluding, for the avoidance of doubt, any payables that are the subject of a bona fide dispute conducted in accordance with any applicable provisions of Section 4.2) (collectively, “Alterations Payables”) are more than sixty (60) days past due (and promptly following Landlord’s written request, Tenant shall provide any back-up documentation reasonably requested by Landlord with respect to such accrued payables), ) or (iii) that if Landlord requests the same, Tenant shall post security for the applicable Alteration as described below. In the event that Tenant fails to deliver a certification that complies with either clause (i) or clause (ii) above by the date that Landlord’s consent to the applicable Alteration is required, Landlord may condition its consent thereto upon Tenant’s agreement to deposit cash with a nationally recognized Title Company or another nationally recognized institutional third party depository selected by Landlord and reasonably approved by Tenant in an amount equal to one hundred ten percent (110%) of the cost of such Alteration (as reasonably estimated by Tenant and supported by any back-up documentation reasonably requested by Landlord, provided that in all events Tenant’s policies and practices for accruing amounts constituting Alterations Payables shall be consistent with the policies and practices of the Tenant Parties with respect to their other accounts payable) that is the subject of such request for Landlord’s consent, which cash shall be disbursed to Tenant periodically in the manner, and subject to similar conditions, as the Restoration Conditions, as applicable; provided, however, that (A) such cash shall be made available to Landlord for the completion of such Alteration in the event that Tenant fails to complete the same in accordance with the terms and conditions of this Lease and such failure continues beyond any applicable notice and cure periods, (B) in the event Tenant is completing such Alterations in accordance with the applicable terms and conditions of this Lease, amounts may, pursuant to an escrow arrangement reasonably acceptable to the Parties, be disbursed to Tenant periodically in the manner, and subject to similar conditions, as the Restoration Conditions, as applicable, and (C) following the completion of such Alteration by Tenant, any remaining deposited amount returned to Tenant upon the completion of such Alteration in accordance with the terms and conditions of this Lease so long as no Disabling Event then exists. Alternatively, Tenant may elect to deposit cash with Landlord (or, at Tenant’s option, to deliver to Landlord an irrevocable standby letter of credit in form and substance reasonably acceptable to Landlord and issued by a Qualified Financial Institution or other financial institution reasonably acceptable to Landlord), in each case in an amount equal to one hundred ten percent (110%) of the cost of such Alteration, which cash or letter of credit (1) may be drawn by Landlord for the completion of such Alteration in the event Tenant fails to complete the same in accordance with the applicable terms and conditions of this Lease and such failure continues beyond any applicable notice and cure periods, (2) in the event Tenant is completing such Alterations in accordance with the applicable terms and conditions of this Lease, Landlord shall, to the extent such letter of credit permits partial draws, permit partial amounts to be disbursed to Tenant periodically, pursuant to an escrow arrangement acceptable to Landlord, in the manner, and subject to similar conditions, as the Restoration Conditions, as applicable, and (3) shall be returned to Tenant upon the completion of such Alteration in accordance with such terms and conditions so long as no Disabling Event then exists.” In connection with the foregoing, all references to “Outstanding Alterations Payables” and the “Outstanding Alterations Payables Threshold” shall be deleted in Severed Leases.with