EXHIBIT 10.49
MODIFICATION OF LEASE AGREEMENT
Modification of Lease Agreement made as of the day of , 2000
by and between PENNBUS REALTIES, INC., c/o Olmstead Properties, Inc., a New York
Corporation having an office at 000 Xxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000
("Landlord") and XXXXXXXX.XXX, INC. (formerly known as XXXXXX INTERACTIVE
CORP.), a New York Corporation having an office at 000 Xxxxxx Xxxxxx, Xxx Xxxx,
Xxx Xxxx 00000 ("Tenant").
WITNESSETH
WHEREAS, Landlord and Tenant have previously entered into a certain
agreement of lease dated March, 1999 (hereinafter referred to as the "Lease"),
covering the entire seventh and eleventh floors (the "Demised Premises") in the
building known as 000 Xxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx (the "Building"); and
WHEREAS, Landlord and Tenant now desire to modify the Lease upon the terms
and conditions hereinafter provided;
NOW, THEREFORE, in consideration of the mutual agreements herein contained
and such other good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the parties hereto hereby agree as follows:
1. Effective on the later of (a) November 1, 2000, and (b) the date
Landlord tenders vacant possession of the Second Additional Space (as
hereinafter defined in paragraph 1A hereof) to Tenant, free and clear of all
leases, tenancies and rights of occupancy (such date shall hereinafter be
referred to as the "Second Additional Space Commencement Date"), of which date
Landlord shall give Tenant one business days' prior to written notice, the
following amendments to the Lease shall automatically occur:
A. The entire rentable portion of the eighth floor of the Building
(hereinafter referred to as the "Second Additional Space") shall be added to and
form a part of the Demised Premises under the Lease. The Second Additional Space
shall be subject to all of the terms, covenants, conditions and provisions of
the Lease.
B. Tenant agrees to accept the Second Additional Space in its present
"as-is" condition in all respects and Landlord shall not be obligated to perform
any work or furnish any materials in connection therewith. Tenant shall not be
required to remedy any violations which relate to the Second Additional Space,
if any, that exist as of the Second Additional Space Commencement Date.
C. The Minimum Rent with respect to the Second Additional Space shall be:
$304,500.00 per annum ($25,375.00 per month) from the Second Additional Space
Commencement Date to and including June 30, 2001; $313,635.00 per annum
($26,136.25 per month) from July 1, 2001 to and including June 30, 2002;
$323,044.05 per annum ($26,920.34 per month) from July 1, 2002 to and including
June 30, 2003; $332,735.37 per annum ($27,727.95 per month) from
*Including without limitation, the fact that Tenant's occupancy of the second
Additional Space shall be coterminous with the balance of the Demised Premises,
subject to 6A below.
July 1, 2003 to and including June 30, 2004; $342,717.43 per annum ($28,559.79
per month) from July 1, 2004 to and including June 30, 2005; $352,998.96 per
annum ($29,416.58 per month) from July 1, 2005 to and including June 30, 2006;
$363,588.92 per annum ($30,299.08 per month) from July 1, 2006 to and including
June 30, 2007; $374,496.59 per annum ($31,208.05 per month) from July 1, 2007 to
and including June 30, 2008; $385,731.49 per annum ($32,144.29 per month) from
July 1, 2008 to and including June 30, 2009; $397,303.43 per annum ($33,108.62
per month) from July 1, 2009 to and including September 30, 2009.
The foregoing Minimum Rent with respect to the Second Additional Space is
in addition to all other rents and charges provided for in the Lease.
D. Tenant's Share as defined in Article 41(b) and 100(B)(iii) of the Lease
shall be deemed to mean 15.25%.
E. The water charge provided for in Article 29 of the Lease shall be
increased from $100.00 per month to $300.00 per month.
F. The sprinkler charge provided for in Article 30 of the Lease shall be
increased from $100.00 per month to $300.00 per month.
G. Tenant's rights to terminate the term of the Lease pursuant to the
provisions of Articles 84 and 85 of the Lease shall be deleted therefrom and be
deemed of no further force or effect.
H. Paragraph 77D. of the Lease shall be deleted therefrom and be replaced
with the following:
"D. It is agreed that if Landlord shall consent to such assignment or
subletting, and Tenant thereupon assigns or sublets all or any portion of the
Demised Premises, then and in that event Tenant shall pay to Landlord, as
Additional Rent, (i) in the event of an assignment, an amount equal to 75% of an
amount equal to (a) all monies received by Tenant in excess of the Minimum Rent
and additional rent payable by Tenant pursuant to this Lease for the
corresponding period of such assignment less (b) Tenant's reasonable expenses
incurred in connection with such assignment, including, but not limited to, any
commercially reasonable brokerage fees, advertising and alterations costs and
attorneys' fees; and, (ii) in the event of a subletting, 75% of an amount equal
to (a) the amount by which the Minimum Rent and additional rent payable by the
sublessee to Tenant shall exceed the Minimum Rent plus additional rent allocable
to that part of the Demised Premises affected by such sublease, pursuant to the
provisions of this Lease, plus (b) the amounts, if any, payable by such
sublessee to Tenant pursuant to any side agreement as consideration (partial or
otherwise) for Tenant making such subletting, less (c) Tenant's reasonable
expenses incurred in connection with such subletting, including, but not limited
to, any commercially reasonable brokerage fees, advertising and alteration
costs, and attorney's fees. Such Additional Rent payments shall be made monthly
within five (5) days after receipt of the same by Tenant, or within five (5)
days after Tenant is credited with the same by the assignee or subleesee. At the
time of submitting the proposed assignment or sublease to Landlord, Tenant shall
certify to Landlord, in writing, whether or not the assignee or sublessee has
agreed to pay any monies to Tenant in consideration of the making of
the assignment or sublease other than as specified and set forth in such
instruments, and if so, Tenant shall certify the amounts and time of payment
thereof in reasonable detail."
2. (A) Landlord agrees to deliver the existing Second Additonal Space air
conditioning system in good working order. All maintenance, repair and
replacement of the air conditioning and ventilation system within the Demised
Premises shall be the responsibility of the Tenant, at the Tenant's sole cost
and expense in a manner reasonably satisfactory to Landlord. Tenant covenants,
and agrees to furnish and maintain, at all times during the term of the Lease,
an air conditioning maintenance contract with an air conditioning service firm
reasonably acceptable to Landlord. Landlord shall not be liable to Tenant in
damages or otherwise, nor shall Tenant be entitled to any abatement or
diminution of Minimum Rent or Additional Rent payable under the Lease, if the
operation of the air conditioning and/or ventilation system is interrupted,
impaired, suspended or terminated because of failures, repairs, installations or
improvements in or about the Demised Premises, nor shall any such interruptions,
impairments, suspensions or termination release Tenant from the performance of
any of its obligations under the Lease.
(B) If either the quantity or character of cooling and/or ventilating
service furnished to the Demised Premises shall change or cease to be available
or suitable for Tenant's requirements, no such change, unavailability or
unsuitability shall constitute an actual or constructive eviction, in whole or
in part, or entitle Tenant to impose any liability upon Landlord or Landlord's
agents.
(C) Tenant shall not, without the prior written consent of Landlord in each
instance, which consent shall not be unreasonably withheld or delayed, make or
permit to be made any additions to or modifications of the existing air
conditioning and ventilating system. Any such additions or modifications
permitted to be made hereunder shall be performed by Tenant at Tenant's expense.
(D) Tenant acknowledges that upon the expiration or sooner termination of
the term of the Lease, the air conditioning system shall remain in, and be
surrendered with, the Demised Premises in good order and condition in a manner
reasonably satisfactory to Landlord. Title to said system shall remain with
Landlord at all times.
(E) Anything contained herein to the contrary notwithstanding, it is
expressly understood and agreed that Tenant shall pay the cost of any and all
permits required by any branch of government of the borough, county, city, state
or federal government in connection with any air conditioning system presently
or hereinafter installed at the Demised Premises.
(F) If electric current for the operation of the air conditioning system is
not measured by the meter which measures Tenant's consumption of electricity in
the Demised Premises, Landlord shall have the right to install such a meter or
to re-route the electric service for the air conditioning system so that
Tenant's meter will measure such consumption.
3. (A) Tenant, at its option and at its sole cost and expense, shall
replace the exterior windows of the Second Additional Space with new thermo
pane windows, in a quality, standard and manner approved by Landlord.
(B) Tenant agrees that all such window replacements shall be performed by a
reputable contractor reasonably approved by Landlord and in accordance with any
applicable rules, laws, regulations and any other reasonable standards required
by Landlord.
(C) Landlord shall reimburse Tenant for: (i) said window replacement in an
amount not to exceed the lesser of 50% of the actual cost or $360.00 per window;
and (ii) one-half of the cost of erecting "bridgework" required at the Building
by reason of Tenant's aforementioned window replacements, but in no event to
exceed $5,000.00. Landlord shall make such reimbursement in the form of a rent
credit provided Tenant shall satisfy the conditions provided in paragraph (D)
hereof.
(D) Tenant shall submit to Landlord original paid bills evidencing the
performance of and payment for the window replacement. Tenant shall obtain and
furnish to Landlord all appropriate certificates from all authorities having
jurisdiction, to the effect that the window replacement has been performed and
completed in accordance with the filed plans, if any, and with all laws, rules,
regulations and orders of said authorities having jurisdiction. It is expressly
understood and agreed that the window replacement shall be performed in
compliance with all applicable rules, regulations and laws of any governmental
department or agency having jurisdiction thereof, as well as in compliance with
Articles 3, 6 and 44 of the Lease. Before commencing the window replacement
Tenant shall have first prepared and submitted to Landlord, for Landlord's prior
written approval which shall not be unreasonably withheld or delayed, a copy of
the proposal and specifications detailing and scheduling the window replacement.
Tenant, at its expense, shall procure each and every license, permit, franchise
or other authorization required for the performance of such window replacement.
Landlord shall cooperate with Tenant in obtaining such permits, etc., and shall
execute such documents reasonably necessary to obtain same, but at no cost to
Landlord. Tenant shall obtain: (i) a partial release of lien simultaneously with
each payment made by Tenant to Tenant's contractor for any labor performed or
materials furnished; and (ii) a final release of lien immediately upon final
payment by Tenant to Tenant's contractor for any labor performed or materials
furnished. All windows shall become the property of the Landlord upon the
expiration or sooner termination of the term of the Lease. It is expressly
understood and agreed that Landlord shall not be responsible for any repair,
replacement or maintenance of the windows, except if due to faults in exterior
walls, or the negligence or willful acts of Landlord, its agents, employees and
contractors.
4. Upon the execution of this Modification of Lease Agreement, Tenant shall
deposit an additional $690,340.00 (representing twenty-four (24) months of
Minimum Rent and estimated electric) in cash or a Letter of Credit (pursuant to
the terms of Article 83 of the Lease), hereinafter referred to as the "Second
Additional Security". It is expressly understood and agreed that on or before
the date of any increase in Minimum Rent as provided in paragraph 1 (C) hereof,
the Tenant shall deposit with the Landlord additional security so that at all
times the Second Additional Security shall be a sum equal to twenty four months
of the then current Minimum Rent for the Second Additional Space, and otherwise
in accordance with the Lease Security Deposit Schedule for the 7th and 11th
floor portions of the Demised Premises annexed
hereto. Any failure or refusal on the part of Tenant to timely make such
additional security deposit, beyond the expiration of any applicable grace and
notice periods, may be deemed by Landlord as a default under the Lease
equivalent to the non-payment of rent. Said Second Additional Security shall be
in addition to all other security due under the Lease. It is expressly
understood and agreed that the provisions of Article 79 of the Lease regarding
the return of a portion of the security deposit shall not apply to the Second
Additional Security.
5. Provided Tenant is not then in default of any of the terms, covenants,
conditions or provisions of the Lease beyond the expiration of any applicable
grace or notice period at the time a rent credit is due, Tenant shall be allowed
eight monthly rent credits of $12,687.50 each to be applied to the second,
third, fourth, fifth, sixth, seventh, eighth and ninth monthly installments of
Minimum Rent for the Second Additional Space. Tenant shall use the Demised
Premises and be subject to all of the terms and conditions of the Lease,
including, but not limited to, the obligation to pay for any and all electric
current utilized in or furnished to the Demised Premises during the term of the
Lease. Tenant acknowledges that it has received all the rent credits to which
Tenant is entitled pursuant to the provisions of Article 80 and paragraph 100(D)
of the Lease.
6. (A) Anything contained in the Lease to the contrary notwithstanding (but
subject to the provisions of paragraph 6 (B) hereof), it is expressly understood
and agreed that in lieu of consenting to any subletting or assignment in
accordance with the provisions of Article 77 of the Lease, in the event Tenant
desires to assign the Lease or sublet: 5,000 square feet or more of the seventh
floor portion of the Demised Premises in the aggregate; or 5,250 square feet or
more of the eighth floor portion of the Demised Premises; or 5,000 square feet
or more of the eleventh floor portion of the Demised Premises, then, in any one
or more of the foregoing circumstances, Landlord shall have the option to cancel
the term of the Lease with respect to either the space to be sublet or the
entire floor of such proposed subletting, or the entire Lease with respect to an
assignment, by giving Tenant written notice of such termination within twenty
days after Landlord's receipt of both: (i) Tenant's request for consent to an
assignment of this Lease or subletting of all or the above-mentioned portion of
the subject floor of the Demised Premises; and (ii) such reasonable information
regarding the financial condition of such proposed assignee or sublessee. In the
event Landlord exercises its foregoing option to terminate the term of this
Lease with respect to all or a portion of the subject floor, such termination
shall become effective as of the effective date of such proposed assignment or
subletting, with the same force and effect as if such termination date was
originally set forth as in the expiration date of the term of the Lease and,
provided Tenant is not then in default of any of the terms, covenants,
conditions or provisions of the Lease beyond the expiration of any applicable
notice and cure periods, Landlord shall promptly return to Tenant the portion of
the Tenant's security deposit, and accrued interest thereon (less Landlord's
administration fee) attributable to the terminated portion of the Demised
Premises (or, if Tenant shall have deposited a Letter of Credit in lieu of
security, Landlord shall accept a replacement Letter of Credit representing a
pro-rata reduction of the original Letter of Credit based upon the
aforementioned termination).
(B) Tenant shall have the right to assign the Lease or sublet all or any
part of the Demised Premises, without obtaining Landlord's consent, to any
parent company, subsidiaries or subsidiary of a parent of Tenant, or any entity
into or with which Tenant is merged or consolidated, or to the purchaser of all,
or substantially all, of Tenant's assets, without being subject to Landlord's
options to cancel the term of the Lease as provided in paragraph 6 (A) hereof,
and without being subject to the sharing of profits provisions contained in
paragraph 77 (D) of the Lease as added thereto pursuant to paragraph 1H hereof.
7. Both Tenant and Landlord each represent and warrant to each other that
they have dealt with no broker except Xxxxxxxx Properties, Inc. (the "Broker")
in connection with the execution of this Modification of Lease Agreement and the
showing of the Second Additional Space. Each party agrees to indemnify and hold
and save the other party harmless from and against any and all liabilities from
any claims of any broker, other than Broker, including, without limitation, the
cost of counsel fees in connection with the defense of any such claims. Based
upon Tenant's representation, Landlord has agreed to enter into this
Modification of Lease Agreement. Landlord shall pay the Broker a commission
pursuant to a separate agreement.
8. The parties hereto hereby reaffirm and ratify the Lease as modified
hereby. No further changes or modifications to the Lease may be made except by a
writing executed by the parties hereto.
9. Capitalized terms used herein which are not otherwise defined shall have
the same meanings ascribed to them in the Lease.
10. The provisions hereof shall be binding upon and inure to the benefit of
the parties hereto and their respective successors, legal representatives, heirs
and permitted assigns.
11. IN WITNESS WHEREOF, the parties hereto have executed this Modification
of Lease Agreement as of the day and year first above written.
PENNBUS REALTIES, INC.
By: /s/ [ILLIGIBLE]
-----------------------
XXXXXXXX.XXX, INC.
By: /s/ Xxxxxxx X. Xxxxxx
-----------------------
President
SECURITY DEPOSIT SCHEDULE
-------------------------
FLOORS 7 AND 11
---------------
Rent Security 240,000 (9 months)
Electric Security 61,006 (9 months)
------
Total Security 301,006
Additional Security
-------------------
9 months rent Addt'l Security Due
------------- -------------------
10/01/2000 247,200 7,200.00
10/01/2001 254,616 7,416
10/01/2002 262,254 7,638
10/01/2003 270,122 7,868
*10/01/2004 293,225 23,103
10/01/2005 302,023 8,798
10/01/2006 311,083 9,060
10/01/2007 320,416 9,333
10/01/2008 330,028 9,612
*Effective 10/1/04, provided Tenant shall not be in default of any of the terms,
covenants, conditions or provisions of the Lease, Landlord shall return such
security to Tenant so that the total security deposit held and due shall be
as follows:
6 months rent Addt'l Security Due
------------- -------------------
10/01/2004 195,484
10/01/2005 201,348 5,864
10/01/2006 207,389 6,041
10/01/2007 213,611 6,222
10/01/2008 220,019 6,408
FLOOR 8
-------
Rent Security 609,000 (2 years)
Electric Security 81,340 (2 years)
-------
Total Security 690,340
Additional Security
-------------------
2 months rent Addt'l Security Due
------------- -------------------
07/01/2001 627,270 18,270
07/01/2002 646,088 18,818
07/01/2003 665,471 19,383
07/01/2004 685,435 19,964
07/01/2005 705,998 20,563
07/01/2006 727,178 21,180
07/01/2007 748,993 21,816
07/01/2008 771,463 22,470
07/01/2009 794,607 23,144
All deposits scheduled are subject to future adjustments upon reevaluation of
Tenants electricity usage
