LEASE, dated as of March __, 1997, between KEREN LIMITED PARTNERSHIP,
a Delaware limited partnership having an office at 000 Xxx Xxx Xxxx Xxxxx Xxxx,
Xxxxxxxxx, Xxx Xxxx 00000-0000 (herein called "Landlord") and EMISPHERE
TECHNOLOGIES, INC., a Delaware corporation having an office at 00 Xxxxxxx Xxxxx,
Xxxxxxxxx, Xxx Xxxx 00000 (herein called "Tenant").
W I T N E S S E T H :
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ARTICLE 1 - DEMISE AND RENT AND DEFINITIONS
1.01. Landlord hereby leases to Tenant, and Tenant hereby leases from
Landlord, the Premises (as defined in Section 1.02) in the buildings known as
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the Linde Building and the Spine Building and identified as such on the plan
attached hereto as Exhibit A (herein collectively called the "Building") on land
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(herein called "Land") owned by Landlord located along Old Saw Mill River Road,
partly in the Town of Greenburgh and partly in the Town of Mount Pleasant, in
the County of Westchester and State of New York and called "The Landmark at
Eastview." Landlord intends to and shall have the right at any time to cause
part or parts of the Land to become a separate tax lot or separate tax lots in
connection with future development thereof. If Landlord does so, any separate
tax lots that do not include the Premises shall be excluded from the Land and
"Land" shall mean only the land in the tax lot of which the Premises are a part.
The Land and all of the buildings and other improvements presently and hereafter
located thereon are herein collectively called the "Project." The buildings and
other improvements presently and hereafter located on the Land are herein
collectively called the "Improvements."
1.02. The premises (herein called the "Premises") leased to Tenant
consist of approximately 66,660 square feet of space, and are shown on Exhibit
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A. Tenant shall have, as appurtenant to the Premises, the non-exclusive right
-
to use in common with other tenants and other occupants of the Project, and
their licensees and invitees, subject to the terms and conditions of this Lease,
including the Rules and Regulations (as hereinafter defined): (a) the common
lobbies, corridors, stairways and elevators of the Building, if any, (b) if the
Premises includes less than the rentable floor area of any floor, the common
toilets, corridors and lobby, if any, of such floor, and (c) outdoor common
areas of the Project.
1.03. The term of this Lease (herein called the "Term") shall
commence on the date (herein called the "Commencement Date") on which this Lease
becomes effective pursuant to Article 38 and shall end at 11:59 p.m. on the last
day of the tenth Lease Year (as hereinafter defined), or on such earlier date
upon which the Term shall expire or be cancelled or terminated pursuant to any
of the conditions or covenants of this Lease or pursuant to law. Upon the valid
exercise of any renewal option, the word "Term" shall be deemed to include the
renewal period for which said option or options was or were exercised.
1.04. (a) The rents shall be and consist of (i) fixed rent (herein
called the "Fixed Rent") at the rate or rates per annum set forth on Exhibit B
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which shall be payable in equal monthly install ments in advance on September 1,
1997 (notwithstanding the fact that the "Rent Commencement Date", as hereinafter
defined, might be later than September 1, 1997) and on the first day of each and
every calendar month thereafter during the Term (except that Tenant shall pay,
upon the execution and delivery of this Lease by Tenant, the sum of $55,417, to
be applied against the first installment or installments of Fixed Rent becoming
due under this Lease), and (ii) additional charges (herein called the
"Additional Charges") consisting of all other sums of money as shall become due
from and payable by Tenant to Landlord hereunder.
(b) Notwithstanding the foregoing provisions of this Section 1.04,
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provided that Tenant is not in default beyond the applicable notice and grace
period with respect to any of the terms, provisions, covenants and conditions of
this Lease on its part to be performed, the Fixed Rent payable by Tenant shall
be partially abated as follows:
(i) During the first three Lease Years (as hereinafter
defined), the Fixed Rent shall be abated so that, after giving effect
to such abatement, the Fixed Rent payable during each of the first
three Lease Years shall be at the respective annual rates set forth
below, which rates reflect the abatement of Fixed Rent for 31,660
rentable square feet in the Premises in the first Lease Year, 21,660
rentable square feet in the Premises for the second Lease Year and
11,660 rentable square feet in the Premises for the third Lease Year.
Lease Year Fixed Rent (after such abatement)
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1 $ 665,000
2 855,000
3 1,045,000
The number of rentable square feet in the Premises for which Fixed Rent is so
abated in a given Lease Year is herein called the "Abated Footage".
(ii) During the first five Lease Years, the Fixed Rent shall
be further abated by $19,101.16 per month ($229,213.92 per year), so
that, after giving effect to such abatement, as well as the abatement
under paragraph (b)(i) above, the Fixed Rent payable during each of
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the first five Lease Years shall be at the respective annual rates set
forth below:
2
Lease Year Fixed Rent (after all abatements)
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1 $ 435,786.08
2 625,786.08
3 815,786.08
4 1,037,326.08
5 1,037,326.08
(c) Notwithstanding anything to the contrary provided in Section
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1.04(b) and 1.04(c), if the First Lease Year is a period of more than 12 months,
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then the abatement in such sections shall only apply to the last 12 full
calendar months in such Lease Year.
(d) All the Fixed Rent and Additional Charges shall be paid in lawful
money of the United States to Landlord at its office c/o Keren Developments
Inc., 000 Xxx Xxx Xxxx Xxxxx Xxxx, Xxxxxxxxx, Xxx Xxxx 00000-0000, Attention:
Accounts Receivable, or such other place, or to Landlord's agent and at such
other place, as Landlord shall designate by notice to Tenant.
1.05. Tenant shall pay the Fixed Rent and Additional Charges promptly
when due without notice or demand therefor and without any abatement, deduction
or setoff for any reason whatsoever, except as may be expressly provided for in
this Lease or by law.
1.06. No payment by Tenant or receipt or acceptance by Landlord of a
lesser amount than the correct Fixed Rent or Additional Charges shall be deemed
to be other than a payment on account, nor shall any endorsement or statement on
any check or any letter accompanying any check or payment be deemed an accord
and satisfaction, and Landlord may accept such check or payment without
prejudice to Landlord's right to recover the balance or pursue any other remedy
in this Lease or provided at law.
1.07. Tenant shall pay the Fixed Rent and Additional Charges as above
and as herein provided, by good and sufficient check (subject to collection)
drawn on a New York City bank which is a member of the New York Clearing House
or a successor thereto.
1.08. If Tenant fails to make any payment of Fixed Rent or Additional
Charges on or before the fifth day after the due date thereof, Tenant shall pay
to Landlord a late charge of 3.5% of the amount of such payment. In addition,
any such amount that remains unpaid for more than 30 days after the due date
thereof shall bear interest at a rate (herein called the "Lease Interest Rate")
equal to the lesser of (a) the rate announced by Citibank, N.A. or its successor
from time to time as its prime or base rate, plus 4%, or (b) the maximum
applicable legal rate, if any, from the date such amount became due and payable
to the date of payment thereof by Tenant. Such late charge and interest shall
be due and payable on demand.
1.09. If any of the Fixed Rent or Additional Charges shall be or
become uncollectible, reduced or required to be refunded because
3
of any Legal Requirements (as defined in Section 1.10(i)), Tenant shall enter
into such agreement(s) and take such other steps (without additional expense or
obligation to Tenant) as Landlord may request and as may be legally permissible
to permit Landlord to collect the maximum rents which from time to time during
the continuance of such legal rent restriction may be legally permissible (and
not in excess of the amounts reserved therefor under this Lease). Upon the
termination of such legal rent restriction, (a) the rent shall become and
thereafter be payable in accordance with the amounts reserved herein for the
periods following such termination and (b) Tenant shall pay to Landlord, to the
maximum extent legally permissible, an amount equal to (i) the rent which would
have been paid pursuant to this Lease but for such legal rent restriction, less
(ii) the rent actually paid by Tenant during the period such legal rent
restriction was in effect.
1.10. The following terms, whenever used in this Lease, shall have
the meanings indicated:
(a) The term "and/or" when applied to two or more matters or
things shall be construed to apply to any one or more or all thereof as the
circumstances warrant at the time in question.
(b) The term "Business Days" shall mean all days except
Saturdays, Sundays and days observed by the Federal or the state
governments as legal holidays.
(c) The term "Business Hours" shall mean 9:00 a.m. to 6:00 p.m.
(d) The terms "herein" and "hereunder," and words of similar
import, shall be construed to refer to this Lease as a whole, and not to
any particular Article or Section, unless expressly so stated.
(e) The term "Insurance Requirements" shall mean the rules,
regulations, mandatory orders and mandatory requirements of the New York
Board of Underwriters and/or the New York Fire Insurance Rating
Organization and/or any other similar body performing the same or similar
functions and having jurisdiction or cognizance over the Building and/or
the Premises, whether now or hereafter in force, and the mandatory
requirements of any insurance policy maintained by Landlord. Insurance
Requirements shall not include recommendations of an insurance inspector
which are not mandatory in nature or a condition to the insurability of the
Building, if non-compliance therewith does not materially increase
Landlord's insurance premiums.
(f) The term "Landlord" shall mean only the owner at the time in
question of the Building or of a lease of the
4
Building, so that in the event of any transfer or transfers of title to the
Building or of Landlord's interest in a lease of the Building, the
transferor shall be and hereby is relieved and freed of all obligations of
Landlord under this Lease accruing after such transfer, and it shall be
deemed, without further agreement, for the benefit of Tenant, that such
transferee has assumed and agreed to perform and observe all obligations of
Landlord herein during the period it is the holder of Landlord's interest
under this Lease.
(g) The term "Lease Year" shall mean (i) the period beginning on
the Rent Commencement Date and ending on the last day of the month in which
the anniversary of the Rent Commencement Date falls, and (ii) each
succeeding twelve-month period thereafter during the Term.
(h) The term "Legal Requirements" shall mean laws and ordinances
of any or all of the federal, state, city, town, county, borough and
village governments and rules, regulations, orders and directives of any
and all departments, subdivisions, bureaus, agencies or offices thereof,
and of any other governmental or public authorities having jurisdiction
over the Building and/or the Premises, and the direction of any public
officer pursuant to law, whether now or hereafter in force.
(i) The term "person" shall mean any natural person or persons, a
partnership, a corporation, and any other form of business or legal
association or entity.
(j) The term "Prime Rate" shall mean the rate announced from time
to time by Citibank, N.A., or its successor, at its principal office, as
its prime or base rate; or, if such rate ceases to be announced, a
comparable reference rate reasonably selected by Landlord.
(k) The term "Rent Commencement Date" shall mean the earlier of
(i) November 15, 1997 and (ii) the earliest date, on or after September 1,
1997, on which Tenant takes occupancy of any part of the Premises for the
regular conduct of its business therein. Promptly after the occurrence of
the Rent Commencement Date, the parties shall confirm such Date in writing.
(l) The term "Tenant" shall mean the Tenant herein named or any
assignee or other successor in interest (immediate or remote) of the Tenant
herein named, which at the time in question is the owner of the Tenant's
estate and interest granted by this Lease; but the foregoing provisions of
this subsection shall not be construed to permit any assignment of this
Lease or to relieve the Tenant herein named or any assignee or other
successor in interest (whether immediate or remote) of the Tenant herein
named from the full and prompt payment, performance and observance of the
covenants, obligations and conditions to be paid, performed and observed by
Tenant under this Lease.
5
ARTICLE 2 - USE
2.01. Tenant shall use and occupy the Premises for general
administrative and executive offices and laboratory space and for no other
purpose. Without limiting the foregoing, subject to Section 2.02 (and the other
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provisions of this Lease), Tenant may, in connection with such laboratory use,
have (among other things) vivariums and cages for rodents and dogs; treatment
rooms; a surgical suite; cage washing equipment; organic synthesis, analytical
and formulations laboratories, each generating hazardous waste; pre-clinical
research laboratories (using biomaterials such as tissue samples, cell culture
and biological fluids); a radioisotope laboratory; a photograph suite with a
darkroom; a warehouse area; and locker rooms with shower facilities.
2.02. Tenant, at its expense, shall duly procure and thereafter
maintain any and all governmental licenses, permits and inspection certificates
(including, without limitation, if required by Legal Requirements, Environmental
Protection Agency authorizations for the disposal of hazardous waste, permits
for the disposal of biohazardous waste, a New York State radioisotope license,
New York State and Westchester County emissions permits and New York State and
U.S. Department of Agriculture inspections) required for the proper and lawful
conduct of Tenant's business in the Premises or any part thereof (other than the
present certificate of occupancy for the Premises and the Building) and submit
the same to Landlord for inspection. Tenant shall at all times comply with the
terms and conditions of each such license, permit and certificate. Without
limiting Tenant's right to use the Premises for the permitted uses set forth in
Section 2.01, Tenant's manner of use of the Premises for such permitted uses
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shall not (a) violate the certificate of occupancy for the Premises or for the
Building or any other permit or license issued pursuant to any Legal
Requirements; (b) cause injury to the Building or any equipment, facilities or
systems therein; (c) constitute a violation of the Legal Requirements or
Insurance Requirements; (d) impair the character, reputation or appearance of
the Building as a first class office building; (e) impair the proper and
economic maintenance, operation and repair of the Building and/or its equipment,
facilities or systems; or (f) annoy (in the reasonable judgment of another
tenant or occupant) or interfere with the permitted uses of other tenants or
occupants of the Project. Tenant shall not at any time use or occupy, or suffer
or permit anyone to use or occupy, the Premises, or any part thereof, for (i) a
disposal site for any toxic chemicals (although Landlord acknowledges that
Tenant may use toxic chemicals in the ordinary course of Tenant's laboratory
use), (ii) a banking, trust company, or safe deposit business, or (iii) a
restaurant and/or bar.
2.03. Landlord represents and warrants to Tenant that the current
certificate of occupancy for the Building and Insurance Requirements applicable
to the insurance maintained by Landlord on the Building permit the uses of the
Premises that are permitted under Section 2.01.
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6
ARTICLE 3 - CONDITION OF PREMISES
3.01. Except as provided in Section 3.03(d), Tenant is leasing the
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Premises "as is" on the date hereof, except for reasonable wear and tear and the
rights of the present occupant(s) of the Premises to remove its or their trade
fixtures and other property from the Premises; and the taking of possession by
Tenant of the Premises shall be conclusive evidence as against Tenant that the
Premises and the Building were in good and satisfactory condition at the time
such possession was taken.
3.02. If Landlord is unable to give possession of the Premises on the
Commencement Date for any reason beyond Landlord's reasonable control
(including, but not limited to, the occurrence of any of the events described in
Section 41.04), then Landlord shall not be subject to any liability for failure
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to give possession on the Commencement Date and the validity of this Lease shall
not be impaired under such circumstances, nor shall the same be construed in any
way to extend the Term, but the Fixed Rent and Additional Charges payable
hereunder shall be abated (provided Tenant is not responsible for the inability
to obtain possession) until Landlord tenders possession to Tenant. If Landlord
gives Tenant permission to enter into the possession of the Premises prior to
the Commencement Date, such possession or occupancy shall be deemed to be upon
all the terms, covenants, conditions and provisions of this Lease (but the Rent
Commencement Date shall not be affected thereby). Tenant hereby waives the
provisions of Section 223-a of the Real Property Law of the State of New York,
and agrees that the provisions of this Article are intended to constitute "an
express provision to the contrary" within the meaning of said Section 223-a.
3.03. (a) Except as provided in Section 3.03(e), Tenant shall
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provide and (subject to Section 3.03(b)) pay for all of its tenant improvements,
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furniture, furnishings, telephone and other communication systems and equipment,
other business and laboratory equipment, and any other facilities or
installations Tenant requires or desires for the conduct of its business in the
Premises. Any tenant improvements and other alterations and installations by
Tenant (herein called the "Work") shall be made only in compliance with the
applicable provisions of this Lease.
(b) Landlord shall contribute $1,350,000 (herein called the
"Landlord's Contribution") to the cost of the Work as follows: On the date that
Swiss Bank (as defined in Section 6.01) delivers to Landlord its approval under
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Section 38.01, Landlord shall pay $675,000 of the Landlord's Contribution to
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Xxxx, Scholer, Fierman, Xxxx & Handler, LLP, as escrow agent (herein called
"Escrow Agent") under the Escrow Agreement dated the date hereof (herein called
the "Escrow Agreement"), among Landlord, Tenant and Escrow Agent, pursuant to
which Escrow Agent will hold, invest in an interest-bearing account and disburse
the Landlord's Contribution. On or before May 1, 1997, Landlord shall pay the
balance of the Landlord's Contribution to Escrow Agent. Provided Tenant shall
not be in default hereunder
7
beyond the applicable grace period, Tenant shall be entitled to receive
disbursements of portions of the Landlord's Contribution from time to time upon
delivery to Escrow Agent, with a copy to Landlord and Swiss Bank, of a notice
requesting such disbursement and certifying that (i) the amount requested (A) is
then due and payable, or has been paid, by Tenant to one or more contractors or
materialmen for goods or services provided in connection with the Work and (B)
constitutes not more than 1/3 of the cost of the Work to date (such that Tenant
shall have paid or be concurrently paying with its own funds at least 2/3 of the
cost of the Work to date); (ii) no portion of such amount has previously been
the subject of any such disbursement request; (iii) all previous such
disbursements have been applied in payment of the costs of the Work for which
they were requested; and (iv) Tenant has delivered to Landlord (A) true and
complete copies of the invoices and/or the requisitions of Tenant's general
contractor (herein called the "GC") with respect to the costs for which such
disbursement is being requested and the costs that have been or are being paid
by Tenant from its own funds, (B) lien waivers from the GC and, in the case of
the final disbursement, all other contractors, subcontractors and materialmen
with respect to the cost of all Work theretofore performed and (C) a lien search
indicating that no liens have been filed against the Building in connection with
the Work; provided, however, that the last $100,000 of the Landlord's
Contribution shall not be released to Tenant unless and until (x) all
governmental authorities have (to the extent required) issued final approval of
the Work as built and (y) Tenant has delivered to Landlord "as built" drawings
with respect to the Work (whereupon all of the remaining Landlord's Contribution
shall be released).
(c) If this Lease is terminated for any reason before the disbursement
of the Landlord's Contribution in full, then Landlord shall be entitled to
receive a refund of the remaining balance of the Landlord's Contribution. In
any event, Landlord shall be entitled to receive the interest collected by
Escrow Agent on the funds held by it under the Escrow Agreement, at the time the
final disbursement of such funds is made, and Landlord shall pay all taxes on
such interest.
(d) Landlord represents and warrants that, on the Rent Commencement
Date, the common rest rooms on the floor where the Premises are located, and the
common areas and entrances and exits of the Building, will comply with all Legal
Requirements (including the Americans with Disabilities Act), and such rest
rooms, common areas and the building systems serving the Premises will be in
good working order.
(e) Landlord shall permit Tenant to move to the Premises (at its
expense) and use during the Term, the equipment described in Exhibit K hereto;
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which equipment shall remain the
8
property of Landlord and be surrendered to Landlord at the end of the Term.
Such equipment is being so provided on an "as is", "where is" basis. Landlord
makes no representation or warranty regarding the condition, fitness or
usefulness of it.
ARTICLE 4 - TAX PAYMENTS
4.01. For the purposes of this Article 4 and other provisions of this
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Lease:
(a) The term "Taxes" shall mean (i) the real estate taxes,
assessments and special assessments imposed upon the Project by any
federal, state, municipal or other governments or governmental bodies or
authorities, and (ii) any expenses incurred by Landlord or any other tenant
in contesting such taxes or assessments and/or the assessed value of the
Improvements and/or the Land, which expenses shall be allocated to the Tax
Year to which such expenses relate; provided, that such expenses incurred
by another tenant shall only be included in "Taxes" if the contest by such
tenant is on behalf of the entire Building (or the entire Project). If at
any time during the Term the methods of taxation prevailing on the date
hereof shall be altered so that in lieu of, or as an addition to or as a
substitute for, the whole or any part of such real estate taxes,
assessments and special assessments now imposed on real estate there shall
be levied, assessed or imposed (x) a tax, assessment, levy, imposition,
license fee or charge wholly or partially as a capital levy or otherwise on
the rents received therefrom, or (y) any other such additional or
substitute tax, assessment, levy, imposition or charge, then all such
taxes, assessments, levies, impositions, fees or charges or the part
thereof so measured or based shall be deemed to be included within the term
"Taxes" for the purposes hereof. However, "Taxes" shall not include any
amounts attributable to new buildings constructed on the Land after the
date hereof to the extent (if any) that the real estate taxes attributable
to such new buildings are at a rate per rentable square foot that exceeds
the average rate per rentable square foot of real estate taxes attributable
to the other buildings in the Project.
(b) The term "Tax Year" shall mean the period of 12 calendar
months beginning on January 1 of the year in which the Term commences, and
each succeeding 12-month period thereafter.
(c) The term "Tenant's Proportionate Share" for purposes of this
Article 4, Article 5 and any other relevant provisions of this Lease shall
mean an amount equal to 9.03% minus the Applicable Abatement Factor,
subject to change as provided in Section 4.06 and in this subdivision (c).
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If any building or buildings is or are enlarged, demolished or removed from
the Land or any new building or buildings is or are erected on the Land,
the term "Tenant's Proportionate Share" shall mean (i) the percentage that
represents a fraction the numerator of
9
which is the number of square feet of gross rentable area in the Premises
and the denominator of which is the aggregate number of square feet of
gross rentable area of all the buildings on the Land (herein called the
"Gross Building Area"), minus (ii) the Applicable Abatement Factor; subject
to change as provided in Section 4.06. Landlord represents to Tenant that
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(1) the Gross Building Area is 737,954 on the date hereof and (2) the
aggregate of Tenant's Proportionate Share of Taxes and the percentages of
Taxes payable by other tenants at the Project, other than Carbide, under
provisions in their leases analogous to this Article 4 that require
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payments of additional charges based on a proportionate share of Taxes (or
increases in Taxes over a base amount) does not exceed the Non-Carbide
Percentage of Taxes payable with respect to the Project (except, possibly,
to a de minimis extent attributable to rounding of fractional amounts).
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(d) The term "Applicable Abatement Factor" for a given Lease Year
shall mean the percentage that represents a fraction the numerator of which
is the Adjusted Abated Footage in such Lease Year and the denominator of
which is the Gross Building Area.
(e) The term "Adjusted Abated Footage" for a given Lease Year
shall mean the lesser of (i) the Abated Footage (if any) in such Lease Year
or (ii) the average number of square feet of gross rentable area in the
Premises that is unoccupied during such Lease Year (with such average being
determined based on the sum of the unoccupied areas for each day in such
Lease Year divided by the total number of such days). For purposes of
calculating periodic installments of Taxes or Operating Expenses prior to
the final determination of the Adjusted Abated Footage in any Lease Year,
the Abated Footage shall be used in calculating the Applicable Abatement
Factor for such Lease Year until the unoccupied area of the Premises
decreases below the Abated Footage; and upon such decrease, and each
further decrease during such Lease Year, such periodic installments
thereafter due shall, upon notice to Tenant, be recalculated to reflect the
projected average under the foregoing clause (ii) based on such
decrease(s). The final determination of the Adjusted Abated Footage shall
be made within thirty (30) days following the end of such Lease Year.
(f) The term "Carbide" means Union Carbide Chemicals and Plastics
Company Inc.
(g) The term "Non-Carbide Percentage" means 100% minus the
percentage of the Gross Building Area that is demised under the lease
between Landlord and Carbide (which expires on December 31, 1997).
4.02. Any Taxes for a real estate fiscal tax year, a part of which is
included within a particular Tax Year and a part of which is not so included,
shall be apportioned on the basis of the number of
10
days in the real estate fiscal tax year included in the particular Tax Year for
the purpose of making the computations under Section 4.03.
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4.03. For each Tax Year, any part of which shall occur during the
period from the Rent Commencement Date through the end of the Term, Tenant shall
pay to Landlord an amount (prorated to the extent provided in Section 4.05, if
------------
applicable) (herein called the "Tax Payment") equal to Tenant's Proportionate
Share of the Taxes for such Tax Year. The Tax Payment for each Tax Year shall
be due and payable in installments in the same manner and at the same time that
the Taxes for such Tax Year are first due and payable to the appropriate taxing
authority. Landlord shall xxxx Tenant for any Tax Payment installment(s)
payable by Tenant pursuant to this Article, such xxxx to set forth in reasonable
detail the computation of the Tax Payment and the particular installment(s)
thereof being billed. In the event of any increase in the Taxes for any Tax
Year, whether during or after such Tax Year, or any decrease in the Taxes during
such Tax Year, the Tax Payment for such Tax Year shall be appropriately adjusted
and paid or refunded, as the case may be, in accordance therewith.
4.04. If Landlord shall receive a refund of the Taxes for any Tax
Year (including any interest on such refund), Landlord shall either pay to
Tenant promptly, or permit Tenant to credit against the next installments of
Fixed and Additional Rent due under this Lease, Tenant's Proportionate Share of
the net refund, plus interest received, if any (after deducting from such total
refund the costs and expenses, including, but not limited to, appraisal,
accounting and legal fees of obtaining the same, to the extent that such costs
and expenses were not included in the Taxes for such Tax Year); provided,
however, such payment or credit to Tenant shall in no event exceed Tenant's Tax
Payment paid for such Tax Year, plus interest on such amount. The provisions of
this Section 4.04 shall survive the expiration or sooner termination of the Term
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(subject to Landlord's right of offset against any amounts owing by Tenant
hereunder).
4.05. If a Tax Year begins prior to the Rent Commencement Date or
ends after the expiration or termination of the Term, the Tax Payment therefor
shall be prorated to correspond to that portion of such Tax Year occurring from
and after the Rent Commencement Date and within the Term.
4.06. If Landlord causes part or parts of the Land to become a
separate tax lot or separate tax lots, then the term "Tenant's Proportionate
Share" shall be the percentage that represents a fraction, the numerator of
which is the number of square feet of gross rentable area in the Premises and
the denominator of which is the aggregate number of square feet of gross
rentable area of all the buildings in the separate tax lot of which the Premises
are a part.
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ARTICLE 5 - OPERATING EXPENSE PAYMENTS
5.01. For the purposes of this Article 5 and other provisions of this
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Lease:
(a) The term "Operating Expenses" shall mean the following costs
and expenses actually paid or incurred by Landlord or on Landlord's behalf
in respect of the repair, maintenance and operation of the Project
(including, without limitation, all expenses of the following types paid or
incurred as a result of Landlord complying with its obligations under this
Lease): (i) salaries, wages, medical, surgical, union and general welfare
benefits (including, without limitation, group life insurance and pension
and welfare payments and contributions and all other fringe benefits paid
to, for or with respect to all persons (whether employees of Landlord or
its managing agent) engaged in the repair, operation and maintenance of the
Project (excluding employees above the level of Project Manager); (ii)
payroll taxes, workers' compensation, uniforms, dry cleaning, and related
expenses for such persons; (iii) the cost of all charges for gas, steam,
electricity, heat, ventilation, air-conditioning, water and other utilities
furnished to the buildings within the Project (including, without
limitation, the common areas thereof) together with any taxes on such
utilities (excluding however, the cost of electricity, heat, ventilating
and air-conditioning described in clauses (9) and (10) of this definition);
(iv) the cost of painting the common areas and other non-rentable space of
the Project; (v) the cost (including sales and other taxes thereon) of
building and cleaning supplies, materials and equipment, rentals and
replacements of tools and equipment (subject to the provisions hereinafter
set forth in this Section 5.01(a)) used in the operation, maintenance, and
---------------
repair of the Project, and charges for telephone service for the management
of the Project; (vi) insurance premiums (including, without limitation,
liability insurance, fire and casualty insurance, rent insurance and any
other insurance), attorneys' fees and disbursements (exclusive of any such
fees and disbursements incurred in applying for any reduction of Taxes or
in connection with the leasing of space in the Project or the enforcement
of leases), auditing and other professional fees and expenses (excluding
audit fees resulting from the auditing of Operating Expenses by Tenant or
any other tenant in the Project, if such audit reveals overcharges that
entitle Tenant, or the tenant in question, to reimbursement of its audit
costs), association dues and any other ordinary and customary financial
expenses incurred in connection with the operation of the Project; (vii)
charges of independent contractors for landscaping, exterminating, snow
removal, and equipment inspection and maintenance; (viii) cost of hand
tools and other movable equipment used exclusively in the repair,
maintenance or operation of the Project (subject to the provisions
hereinafter set forth in this Section 5.01(a)); (ix) the cost of all
---------------
charges for window and other cleaning and janitorial and security
12
services; (x) the cost of repairs and replacements made by Landlord
(subject to the provisions hereinafter set forth in this Section 5.01(a));
---------------
(xi) the cost of alterations and improvements to the Project (in addition
to ordinary repairs and maintenance) made to comply with Legal Requirements
or Insurance Requirements not yet enacted as of the date hereof (and
subject to the provisions hereinafter set forth in this Section 5.01(a));
(xii) payments under service contracts to perform services included in
Operating Expenses; (xiii) management fees or, if no managing agent is
employed by Landlord, a sum in lieu thereof, in either case, not to exceed
the lesser of (A) the then prevailing rates for management fees of similar
properties in Westchester County or (B) 4.5% of the rents and additional
charges from tenants of the Project; and (xiv) all other charges properly
allocable to the repair, operation and maintenance of the Project in the
ordinary course of business and in accordance with generally accepted
accounting principles; excluding, however, (1) depreciation and
amortization, (2) interest on and amortization of debts, (3) ground rent,
(4) leasehold improvements made for existing or future tenants of the
Project, (5) brokerage commissions, (6) refinancing costs, (7) costs and
expenses in connection with the construction of new buildings, including
all planning, legal and related costs, (8) Taxes, (9) the cost of Basic
Electric and HVAC Electric (as such terms are defined in Section 15.01)
furnished to the Premises or to other tenants of the Project, (10) the cost
of producing and furnishing steam and chilled water to provide heat,
ventilating and air-conditioning furnished to the Premises or to other
tenants of the Project, (11) costs paid or reimbursed directly by Tenant or
another tenant in the Project (as distinguished from costs that are passed
along to other tenants by virtue of provisions in their leases, analogous
to this Article 5, which require them to pay a proportionate share of
---------
operating costs or increases therein), and (12) capital improvements that
do not qualify under clause (xi) above and are not either (a) of a type
which will reduce Operating Expenses or (b) reasonably required to maintain
the condition of the Project in substantially the condition that it is as
of the date hereof. The cost of any capital improvement or machinery or
equipment that is included as an Operating Expense under the foregoing
definition shall be included in Operating Expenses for the Operating Year
in which such improvement was made or machinery or equipment was pur
chased, provided that to the extent the cost of such capital improvement or
machinery or equipment is required to be capitalized for federal income tax
purposes, such cost shall be amortized on a straight-line basis over the
useful life thereof utilized for federal income tax purposes, and the
annual amortization of such capital improvement or machinery or equipment,
together with interest on the unamortized balance of such cost at the Prime
Rate in effect when such cost is first incurred, shall be included in
Operating Expenses. If the capital expenditure is of a type which will
reduce Operating Expenses, and does not qualify under the foregoing clause
12(b),
13
then the amount to be included in Operating Expenses for any year on
account of such expenditure will not exceed the amount of Operating Expense
Savings achieved. Any cost or expense shall be included in Operating
Expenses for any Operating Year no more than once, notwithstanding that
such cost or expense may fall under more than one of the categories listed
above. Landlord may use related or affiliated entities to provide services
or furnish materials for the Project provided that the rates or fees
charged by such entities are competitive with those charged by unrelated or
unaffiliated entities for the same services or materials. If during any
Operating Year the tenant or occupant of any space in the Project undertook
to perform work or services therein in lieu of having Landlord perform the
same and the cost thereof would have been included in Operating Expenses if
done by Landlord, then, in any such event(s), the Operating Expenses for
such Operating Year shall include the amount that would have been incurred
if Landlord had performed such work or services, as the case may be, to the
extent necessary only to allow Landlord to collect in full Landlord's
actual cost for performing such work or service for the remaining tenants
of the Project. Operating Expenses shall be calculated on the accrual
basis of accounting. Landlord represents to Tenant that the aggregate of
Tenant's Proportionate Share of Operating Expenses and the percentages of
Operating Expenses payable by other tenants at the Project (other than
Carbide) under provisions in their leases analogous to this Article 5 (or
included in a base year for such Tenant) does not exceed the Non-Carbide
Percentage of Operating Expenses actually incurred by Landlord with respect
to the Project (except, possibly, to a de minimis extent attributable to
rounding of fractional amounts).
(b) The term "Operating Year" shall mean the calendar year
beginning on January 1 of the year in which the Term commences, and each
succeeding calendar year thereafter.
(c) The term "Operating Statement" shall mean a written statement
prepared by Landlord or its agent, setting forth Landlord's computation of
the sum payable by Tenant under this Article for a specified Operating
Year.
5.02. For each Operating Year, any part of which occurs during the
period from the Rent Commencement Date through the end of the Term, Tenant shall
pay to Landlord an amount (prorated to the extent provided in Section 5.06, if
------------
applicable) (herein called the "Operating Payment") equal to Tenant's
Proportionate Share of the Operating Expenses for such Operating Year. Said
payments shall be made as provided in Section 5.03.
------------
5.03. Landlord shall furnish to Tenant, prior to the commencement of
each Operating Year (or, in the case of the Operating Year in which the Term
commences, prior to the Rent Commencement Date), a written statement setting
forth Landlord's estimate of the Operating Payment for such Operating Year.
Tenant shall pay to
14
Landlord on the first day of each month during such Operating Year (or the
portion thereof subsequent to the Rent Commencement Date, as the case may be) an
amount equal to one-twelfth of Landlord's estimate of the Operating Payment for
such Operating Year. If, however, Landlord shall furnish any such estimate for
an Operating Year subsequent to the commencement thereof, then (a) until the
first day of the month following the month in which such estimate is furnished
to Tenant, Tenant shall pay to Landlord on the first day of each month an amount
equal to the monthly sum payable by Tenant to Landlord under this Section in
respect of the last month of the preceding Operating Year; (b) after such
estimate is furnished to Tenant or included in or together with such estimate,
Landlord shall give notice to Tenant stating whether the installments of the
Operating Payment previously made for such Operating Year were greater or less
than the installments of the Operating Payment to be made for such Operating
Year in accordance with such estimate, and (i) if there shall be a deficiency,
Tenant shall pay to Landlord the amount thereof within 10 days after demand
therefor, without interest, or (ii) if there shall have been an overpayment,
Landlord shall promptly either refund to Tenant the amount thereof or permit
Tenant to credit the amount thereof against the next subsequent payments under
this Article or Article 4, without interest; and (c) on the first day of the
---------
month following the month in which such estimate is furnished to Tenant, and
monthly thereafter throughout the remainder of such Operating Year, Tenant shall
pay to Landlord an amount equal to one-twelfth of the Operating Payment shown on
such estimate. Landlord may, at any time during each Operating Year, furnish to
Tenant a revised statement of Landlord's estimate of the Operating Payment for
such Operating Year; and in such case, the Operating Payment for such Operating
Year shall be adjusted and paid or refunded, as the case may be, substantially
in the same manner as provided in the preceding sentence.
5.04. Within 120 days after the end of each Operating Year Landlord
shall furnish to Tenant an Operating Statement for such Operating Year. If the
Operating Statement shows that the sums paid by Tenant under Section 5.03
------------
exceeded the Operating Payment to be paid by Tenant for such Operating Year,
Landlord shall promptly either refund to Tenant the amount of such excess or
permit Tenant to credit the amount of such excess against the next subsequent
payments under this Article or Article 4; and if the Operating Statement for
---------
such Operating Year shows that the sums so paid by Tenant were less than the
Operating Payment to be paid by Tenant for such Operating Year, Tenant shall pay
to Landlord the amount of such deficiency within 10 days after demand therefor,
in either case without interest. The provisions of this Section 5.04 shall
------------
survive the expiration or sooner termination of the Term (subject to Landlord's
right of offset against any amounts owing by Tenant hereunder).
5.05. Tenant, upon notice given within 90 days of the receipt of such
Operating Statement, may elect to have Tenant's designated (in such notice)
certified public accountant (who may be an employee of Tenant) examine such of
Landlord's books and records as are directly relevant to the Operating Statement
in question. (If
15
Tenant shall not give such notice within such 90-day period, then the
Operating Statement as furnished by Landlord shall be conclusive and binding
upon Tenant.) Tenant, pending the resolution of any contest shall continue
to pay all sums as determined to be due in the first instance by Landlord's
Operating Statement and upon the resolution of such contest, suitable
adjustment shall be made in accordance therewith with appropriate refund to be
made by Landlord to Tenant (or credit allowed Tenant against the Fixed Rent and
Additional Charges becoming due). If, within such 90-day period, Tenant shall
disagree with Landlord's Operating Statement, then Tenant may send a written
notice ("Tenant's Statement") to Landlord of such disagreement specifying in
reasonable detail the basis for Tenant's disagreement and the amount of the
Operating Payment Tenant claims is due. Landlord and Tenant shall attempt to
adjust such disagreement. If they are unable to do so and the amount of the
Operating Payment Tenant claims is due is substantially different from the
amount of the Operating Payment Landlord claims is due, Landlord and Tenant
shall designate a certified public accountant (herein called the "Arbiter")
whose determination made in accordance with this Section 5.05 shall be binding
------------
upon the parties; it being understood that if the amount of the Operating
Payment Tenant claims is due is not substantially different from the amount of
the Operating Payment Landlord claims is due, then Tenant shall have no right to
protest such amount and shall pay the amount that Landlord claims is due to the
extent not theretofore paid. The term "substantially" as used in the previous
sentence shall mean a variance of $3,000 or more. If the determination of the
Arbiter shall substantially confirm the determination of Landlord and not
Tenant, then Tenant shall pay the cost of the Arbiter. If the determination of
the Arbiter shall substantially confirm the determination of Tenant and not
Landlord, then Landlord shall pay the cost of the Arbiter and the cost of
Tenant's examination of Landlord's books and records in connection with the
disputed Operating Statement. The term "substantially" as used in the previous
two sentences shall mean a variance of 3% or less. In all other events, the
cost of the Arbiter shall be borne equally by Landlord and Tenant, and Tenant
shall bear such costs of examination. The Arbiter shall be a member of an
independent certified public accounting firm having at least three (3)
accounting professionals who shall not be employed by (except for purposes of
this arbitration) or affiliated with either Landlord or Tenant. In the event
that Landlord and Tenant shall be unable to agree upon the designation of the
Arbiter within thirty (30) days after receipt of notice from the other party
requesting agreement as to the designation of the Arbiter, which notice shall
contain the names and addresses of two or more certified public accountants who
are acceptable to the party sending such notice (any one of whom, if acceptable
to the party receiving such notice as shall be evidenced by notice given by the
receiving party to the other party within such thirty (30) day period, shall be
the agreed upon Arbiter), then either party shall have the right to request the
American Arbitration Association (the "AAA") (or any organization which is the
successor thereto) to designate as the Arbiter a certified public accountant
whose determination made in accordance with this Section 5.05 shall be
------------
conclusive and binding upon
16
the parties, and the cost of such certified public accountant designated by the
AAA (or any organization which is the successor thereto) shall be borne as
hereinbefore provided in the case of the Arbiter designated by Landlord and
Tenant. Landlord and Tenant hereby agree that any determination made by an
Arbiter designated pursuant to this Section 5.05 shall not exceed the amount(s)
------------
as determined to be due in the first instance by Landlord's Operating Statement,
nor shall such determination be less than the amount(s) claimed to be due by
Tenant in Tenant's Operating Statement, and that any determination which does
not comply with the foregoing shall be null and void and not binding on the
parties. In rendering such determination such Arbiter shall not add to, subtract
from or otherwise modify the provisions of this Lease, including the immediately
preceding sentence.
5.06. If the Rent Commencement Date shall occur other than on the
first day of an Operating Year or an Operating Year ends after the expiration or
termination of this Lease, any Additional Charges in respect thereof payable
under this Article shall be equitably prorated to correspond to that portion of
the Operating Year occurring from and after the Rent Commencement Date and
within the Term.
ARTICLE 6 - SUBORDINATION, NOTICE TO SUPERIOR
LESSORS AND SUPERIOR MORTGAGEES
6.01. The holder of any mortgage which may now or hereafter affect
the Land and/or the Building and/or any Superior Lease (as hereinafter defined)
may elect that this Lease and all rights of Tenant hereunder shall have priority
over such mortgage and, upon notification by such holder to Tenant, this Lease
shall be deemed to have priority over such mortgage, whether this Lease is dated
prior to or subsequent to the date of such mortgage. Subject to Section 6.04,
------------
except for any mortgage where the holder gave the aforesaid notification that
this Lease shall have priority over such mortgage, this Lease, and all rights of
Tenant hereunder, are and shall be subject and subordinate to all ground leases,
overriding leases and underlying leases of the Land and/or the Improvements now
or hereafter existing and to all mortgages which may now or hereafter affect the
Land and/or the Improvements and/or any of such leases, including, without
limitation, that certain Mortgage Consolidation, Modification, Extension and
Spreader Agreement dated as of September 30, 1987, between Landlord, as
Mortgagor, and Swiss Bank Corporation, New York Branch (herein called "Swiss
Bank"), as Mortgagee, and that certain Restated Mortgage dated as of September
30, 1987, between Landlord, as Mortgagor, and Carbide, as Mortgagee, whether or
not such mortgages shall also cover other lands and/or buildings and/or leases,
to each and every advance made or hereafter to be made under such mortgages, and
to all renewals, modifications, replacements and extensions of such leases and
such mortgages and spreaders and consolidations of such mortgages. This Section
shall be self-operative and no further instrument of subordination or priority
(as described in the first sentence of this
17
Section) shall be required. In confirmation of such subordination or priority
(as described in the first sentence of this Section), subject to Section 6.04,
------------
Tenant shall promptly execute, acknowledge and deliver any instrument that
Landlord, the lessor under any such lease or the holder of any such mortgage or
any of their respective successors in interest may reasonably request to
evidence such subordination or priority; and if Tenant fails to execute,
acknowledge or deliver any such instruments within 10 days after request
therefor, Tenant hereby irrevocably constitutes and appoints Landlord as
Tenant's attorney-in-fact, coupled with an interest, to execute and deliver any
such instruments for and on behalf of Tenant. Any lease to which this Lease is,
at the time referred to, subject and subordinate is herein called a "Superior
Lease," and the lessor of a Superior Lease or its successor in interest, at the
time referred to, is herein called a "Superior Lessor" and any mortgage (a) to
which this Lease is, at the time referred to, subject and subordinate or (b) to
which this Lease shall have priority due to the effect of the first sentence of
this Section is herein called a "Superior Mortgage" and the holder of a Superior
Mortgage is herein called a "Superior Mortgagee."
6.02. If any act or omission of Landlord would give Tenant the right,
immediately or after lapse of a period of time, to cancel or terminate this
Lease, or to claim a partial or total eviction, Tenant shall not exercise such
right (a) until it has given written notice of such act or omission to Landlord
and each Superior Mortgagee and each Superior Lessor whose name and address
shall previously have been furnished to Tenant, and (b) until a reasonable
period for remedying such act or omission shall have elapsed following the
giving of such notice and following the time when such Superior Mortgagee or
Superior Lessor shall have become entitled under such Superior Mortgage or
Superior Lease, as the case may be, to remedy the same (which reasonable period
shall in no event be less than the longer of 30 days or the period to which
Landlord would be entitled under this Lease or otherwise, after similar notice,
to effect such remedy), provided such Superior Mortgagee or Superior Lessor
shall with due diligence give Tenant notice of intention to, and commence and
continue to, remedy such act or omission. The current address of Swiss Bank, a
Superior Mortgagee, is Director, Restructuring, IMBG Restructuring, Swiss Bank
Corporation, 000 Xxxxxxxx, Xxx Xxxx, Xxx Xxxx 00000. The current address of
Carbide, a Superior Mortgagee, is 00 Xxx Xxxxxxxxx Xxxx, Xxxxxxx, Xxxxxxxxxxx
00000-0000, Attention of Director of General Services.
6.03. If any Superior Mortgagee or Superior Lessor shall succeed to
the rights of Landlord under this Lease, whether through possession or
foreclosure action or delivery of a new lease or deed (herein called a
"Successor Landlord"), then Tenant shall attorn to and recognize such Successor
Landlord as Tenant's landlord under this Lease and shall promptly execute and
deliver any instrument that such Successor Landlord may reasonably request to
evidence such attornment. Upon such attornment this Lease shall continue in full
force and effect as a direct lease between the Successor Landlord and Tenant
upon all of the terms, conditions and covenants as are set forth in this Lease,
but, except as may otherwise be expressly provided in the
18
applicable SNDA (as hereinafter defined), the Successor Landlord shall not (a)
be liable for any previous act or omission of Landlord under this Lease
(although the Successor Landlord shall be obligated to correct any conditions
existing at the date of attornment which violate the Successor Landlord's
obligations as Landlord hereunder); (b) be subject to any offset, not expressly
provided for in this Lease, which theretofore shall have accrued to Tenant
against Landlord; (c) be obligated to complete any work to prepare the Premises
for Tenant's occupancy; (d) be obligated to make any payment to or on behalf of
Tenant which theretofore shall have accrued, except for refunds or credits of
Taxes or Operating Expenses due to Tenant; (e) be required to account for any
security deposit other than any actually delivered to the Successor Landlord; or
(f) be bound by any previous modification of this Lease or by any previous
prepayment of more than one month's Fixed Rent, unless such modification or
prepayment shall have been expressly approved in writing by the lessor of the
Superior Lease or the holder of the Superior Mortgage through or by reason of
which the Successor Landlord shall have succeeded to the rights of Landlord
under this Lease.
6.04. The subordination of this Lease to the Superior Mortgages
held by Swiss Bank and Carbide is conditional upon the delivery to Tenant of the
SNDA's described in Section 38.01. The subordination of this Lease to any
-------------
Superior Lease or any Superior Mortgage other than the Superior Mortgages held
by Swiss Bank and Carbide is conditioned upon the delivery to Tenant by the
Superior Lessor or Superior Mortgagee thereunder of an SNDA in form reasonably
acceptable to Tenant (it being understood that any form of SNDA that is not
materially adversely different from the SNDA delivered by Swiss Bank or Carbide
shall be deemed to be acceptable to Tenant).
6.05. If any prospective or actual Superior Mortgagee or Superior
Lessor requires any modification of this Lease, Tenant shall, upon notice
thereof from Landlord, promptly execute and deliver to Landlord the instrument
accompanying said notice from Landlord to effect such modification if such
instrument does not adversely affect in any material respect any of Tenant's
rights under this Lease and does not increase in any material respect any of
Tenant's obligations under this Lease.
ARTICLE 7 - QUIET ENJOYMENT
7.01. So long as no event has occurred (including the expiration of
applicable notice and grace, if any) which, pursuant to Article 24, would give
----------
Landlord the right to terminate this Lease, Tenant shall peaceably and quietly
have, hold and enjoy the Premises without hindrance, ejection or molestation by
Landlord or any person lawfully claiming through or under Landlord, subject,
nevertheless, to the provisions of this Lease and to any Superior Leases and
Superior Mortgages. This covenant shall be construed as a covenant running with
the Land, and is not, nor shall it be construed as, a personal covenant of
Landlord, except to the extent of Landlord's interest in this Lease and only so
long as such interest shall continue, and
19
thereafter this covenant shall be binding only upon subsequent successors in
interest of Landlord's interest in this Lease, to the extent of their respective
interests, as and when they shall acquire the same, and so long as they shall
retain such interest.
ARTICLE 8 - ASSIGNMENT, SUBLETTING AND MORTGAGING
8.01. Tenant shall not, whether voluntarily, involuntarily, or by
operation of law or otherwise (a) assign or otherwise transfer this Lease, or
offer or advertise to do so, (b) sublet the Premises or any part thereof, or
offer or advertise to do so, or allow the same to be used, occupied or utilized
by anyone other than Tenant, or (c) mortgage, pledge, encumber or otherwise
hypothecate this Lease or the Premises or any part thereof in any manner
whatsoever, without in each instance obtaining the prior consent of Landlord and
all Superior Mortgagees. For purposes of the foregoing clause (b), incidental
use of desk or laboratory space by persons controlled by, controlling or under
common control with Tenant shall be considered to be use by Tenant.
8.02. If and so long as Tenant is a corporation or a partnership, the
following shall be deemed to be an assignment of this Lease under Section 8.01
------------
prohibited by said Section unless Tenant obtains the prior consent of Landlord
and all Superior Mortgagees: one or more sales or transfers of stock or
partnership interests, voluntarily, involuntarily, by operation of law or
otherwise, or the issuance of new stock or partnership interests, by which an
aggregate of more than 50% of Tenant's stock or partnership interests shall be
vested in a party or parties who are not stockholders or partners as of the date
hereof. This Section shall not apply to transactions with a corporation or
partnership into or with which Tenant is merged or consolidated or to which
substantially all of Tenant's assets are transferred or to any corporation or
partnership which controls or is controlled by Tenant or is under common control
with Tenant if (a) the successor to Tenant has a tangible net worth that is
reasonably sufficient to enable such successor to pay and perform Tenant's
obligations hereunder in accordance herewith, and (b) proof satisfactory to
Landlord of such tangible net worth is delivered to Landlord at least 10 days
prior to the effective date of any such transaction. The provisions of this
Section shall not apply to any corporation the outstanding voting stock of which
is listed on a national securities exchange (as defined in the Securities
Exchange Act of 1934, as amended) or is traded in the over-the-counter market
with quotations reported by the National Association of Securities Dealers
through its automated system for reporting quotations.
8.03. If this Lease is assigned, whether or not in violation of the
provisions of this Lease, Landlord may collect rent from the assignee. If the
Premises or any part thereof are sublet or used or occupied by anybody other
than Tenant, whether or not in violation of this Lease, Landlord may, after
default by Tenant, and expiration of Tenant's time to cure such default, collect
rent from the subtenant or occupant. In either event, Landlord may apply the
20
net amount collected to the Fixed Rent and Additional Charges herein reserved,
but no such assignment, subletting, occupancy or collection shall be deemed a
waiver of any of the provisions of Section 8.01, or the acceptance of the
------------
assignee, subtenant or occupant as tenant, or a release of Tenant from the
performance by Tenant of Tenant's obligations under this Lease. The consent by
Landlord and any Superior Mortgagee to assignment, mortgaging, subletting or use
or occupancy by others shall not in any way be considered to relieve Tenant from
obtaining the consent of Landlord and all Superior Mortgagees to any other or
further assignment, mortgaging, subletting or use or occupancy by others not
expressly permitted by this Article. References in this Lease to use or
occupancy by others (that is, anyone other than Tenant) shall not be construed
as limited to subtenants and those claiming under or through subtenants but as
including also licensees and others claiming under or through Tenant,
immediately or remotely.
8.04. Any assignment or transfer, whether made with Landlord's and
all Superior Mortgagees' consent pursuant to Section 8.01 or without the
------------
requirement of Landlord's and all Superior Mortgagees' consent pursuant to
Section 8.02, shall be made only if, and shall not be effective until, the
------------
assignee shall execute, acknowledge and deliver to Landlord an agreement in form
and substance reasonably satisfactory to Landlord and all Superior Mortgagees
whereby the assignee shall assume the obligations of this Lease on the part of
Tenant to be performed or observed and whereby the assignee shall agree that the
provisions in Section 8.01 shall, notwithstanding such assignment or transfer,
------------
continue to be binding upon it in respect of all future assignments and
transfers. Notwithstanding any assignment or transfer, whether or not in
violation of the provisions of this Lease, and notwithstanding the acceptance of
the Fixed Rent or Additional Charges by Landlord from an assignee, transferee,
or any other party, the original named Tenant shall remain fully liable for the
payment of the Fixed Rent and Additional Charges and for the other obligations
of this Lease on the part of Tenant to be performed or observed.
8.05. The liability of Tenant and any immediate or remote successor
in interest of Tenant and the due performance of the obligations of this Lease
on Tenant's part to be performed or observed shall not be discharged, released
or impaired in any respect by any agreement or stipulation made by Landlord with
the then Tenant extending the time of, or modifying any of the obligations of,
this Lease, or by any waiver or failure of Landlord to enforce any of the
obligations of this Lease.
8.06. Neither the listing of any name other than that of Tenant,
whether on the door of the Premises or on any directory, or otherwise, nor the
acceptance by Landlord of any check not drawn by Tenant in payment of Fixed Rent
or Additional Charges, shall operate to vest any right or interest in this Lease
or in the Premises, nor shall it be deemed to be the consent of Landlord to any
assignment or
21
transfer of this Lease or to any sublease of the Premises or to the use or
occupancy thereof by others.
8.07. Except as specifically provided to the contrary in this Article
-------
8, if Tenant shall at any time or times during the Term desire to assign this
-
Lease or sublet all or any part of the Premises, Tenant shall give notice
thereof to Landlord and all Superior Mortgagees, which notice shall be
accompanied by (a) a summary of the material business terms of the proposed
assignment or sublease the effective or commencement date of which shall be at
least 60 days after the giving of such notice, (b) a statement setting forth in
reasonable detail the identity of the proposed assignee or subtenant, the nature
of its business and its proposed use of the Premises, and (c) current financial
information with respect to the proposed assignee or subtenant, including,
without limitation, its most recent financial report. Such notice shall be
deemed an offer from Tenant to Landlord whereby Landlord (or Landlord's
designee) may, at its option, (i) sublease such space from Tenant upon the terms
and conditions hereinafter set forth or (ii) terminate this Lease (if the
proposed transaction is an assignment or a sublease of all or substantially all
of the Premises for all or substantially all of the remaining Term). Said
options may be exercised by Landlord by notice to Tenant at any time within 60
days after such notice has been given by Tenant to Landlord; and during such 60-
day period Tenant shall not assign this Lease or sublet such space to any
person.
8.08. If Landlord exercises its option to terminate this Lease in the
case where Tenant desires either to assign this Lease or sublet all or
substantially all of the Premises for all or substan tially all of the
remaining Term, then this Lease shall end and expire on the date that such
assignment or sublet was to be effective or commence, as the case may be, and
the Fixed Rent and Additional Charges shall be paid and apportioned to such
date.
8.09. If Landlord exercises its option to sublet the Premises which
Tenant desires to sublet, such sublease to Landlord or its designee (as
subtenant) shall be at the lower of (i) the rental rate per rentable square foot
of the Fixed Rent and Additional Charges then payable pursuant to this Lease or
(ii) the rentals set forth in the proposed sublease, and shall be for the same
term as that of the proposed subletting, and:
(a) the sublease shall be expressly subject to all of the
covenants, agreements, terms, provisions and conditions of this Lease
except such as are irrelevant or inapplicable, and except as otherwise
expressly set forth to the contrary in this Section;
(b) such sublease shall be upon the same terms and conditions as
those contained in the proposed sublease, (i) except such as are irrelevant
or inapplicable and except as otherwise expressly set forth to the contrary
in this Section and (ii) except that such sublease shall contain provisions
analogous
22
to Section 8.16, obligating the sublessee to share net assignment or sub-
------------
subletting profits with Tenant;
(c) such sublease shall give the sublessee the unqualified and
unrestricted right, without Tenant's permission, to assign such sublease or
any interest therein and/or to further sublet the Premises or any part or
parts thereof and to make any and all changes, alterations, and
improvements in the Premises, subject to the further provisions of
paragraph (d);
(d) such sublease shall provide that any assignee or further
subtenant of Landlord or its designee may, at the election of Landlord, be
permitted to make alterations, decorations and installations in such space
or any part thereof and shall also provide in substance that (i) any such
alterations, decorations and installations in such space therein made by
any assignee or subtenant of Landlord or its designee may be removed, in
whole or in part, by such assignee or subtenant, at its option, prior to or
upon the expiration or other termination of such sublease provided that
such assignee or subtenant, at its expense, shall repair any damage and
injury to such space so sublet caused by such removal and (ii) if such
sublease is for a term ending more than one year prior to the end of the
Term, such assignee or subtenant shall, at Tenant's option, restore such
space substantially to the condition thereof prior to such alterations and
installations, to the extent such alterations and installations are not
consented to by Tenant and would not have been permitted without such
consent under the terms of Tenant's proposed sublease;
(e) such sublease shall provide that (i) the parties to such
sublease expressly negate any intention that any estate created under such
sublease be merged with any other estate held by either of said parties,
(ii) any assignment or further subletting by Landlord or its designee (as
the sublessor) may be for any purpose or purposes that Landlord, in
Landlord's uncontrolled discretion, shall deem suitable or appropriate, and
(iii) at the expiration of the term of such sublease, Tenant will accept
the space covered by such sublease in its then existing condition, subject
to the obligations of the subtenant to make such repairs and restorations
thereto as are required by paragraph (d) above and/or as may be necessary
to preserve the premises demised by such sublease in good order and
condition, ordinary wear and tear and damage by fire or other casualty
excepted; and
(f) Tenant shall not be liable hereunder, during the term of such
sublease, for any breach by the subtenant (or any under-tenant) of the
covenants in this Lease relating to the use, occupancy, maintenance, repair
or insurance of the portion of the Premises covered by such sublease; and
such sublease shall provide that the subtenant will indemnify and hold
harmless Tenant against any liability, damages, losses or costs arising
23
from any such breach; provided, however, that no Superior Mortgagee shall
be bound by the foregoing clause.
8.10. If Landlord does not exercise its options pursuant to Section
-------
8.07 to so sublet the Premises or terminate this Lease and providing that Tenant
----
is not in default of any of Tenant's obligations under this Lease, Landlord's
consent (which shall be in form reasonably satisfactory to Landlord) to the
proposed assignment or sublease shall not be unreasonably withheld, provided and
upon condition that:
(a) Tenant shall have complied with the provisions of Section
-------
8.07 and Landlord shall not have exercised any of its options under said
----
Section 8.07 within the time permitted therefor;
------------
(b) in Landlord's judgment the proposed assignee or subtenant is
engaged in a business and the Premises will be used in a manner which (i)
is in keeping with the then standards of the Building, (ii) is limited to
the use expressly permitted under Section 2.01 or any other office,
------------
laboratory or similar use which complies with Legal Requirements and
Insurance Requirements and otherwise with the provisions of this Lease, and
(iii) will not violate any negative covenant as to use contained in any
other lease of space in the Project;
(c) the proposed assignee or subtenant is a reputable person of
good character and with sufficient financial worth considering the
responsibility involved, and Landlord has been furnished with reasonable
proof thereof;
(d) the proposed assignee or sublessee is not a person with whom
Landlord is then negotiating to lease space in the Project;
(e) the form of the proposed sublease (if Tenant proposes to
sublease all of the Premises) shall be in form reasonably satisfactory to
Landlord and shall comply with the applicable provisions of this Article;
and
(f) the consent of any Superior Mortgagee whose Superior Mortgage
requires the consent of the Superior Mortgagee shall have been obtained (or
deemed obtained thereunder). Landlord shall use diligent efforts to obtain
such consent.
8.11. Tenant shall reimburse Landlord on demand for any costs that
may be incurred by Landlord in connection with any proposed assignment or
sublease, whether consented to by Landlord or not, including, without
limitation, the costs of making investigations as to the acceptability of the
proposed assignee or subtenant, and legal costs incurred in connection with the
granting of any requested consent.
24
8.12. If the proposed subtenant under a proposed sublease is (or
controls, is controlled by or is under common control with) a person that is
then an occupant of the Project, and if Landlord also then has space available
for lease at the Project, then the amount of the aggregate rent per rentable
square foot to be paid under such proposed sublease shall not be less than the
then current market rent per rentable square foot for the Premises as though the
Premises were vacant and unleased. The rental and other terms and conditions of
any actual sublease shall be the same as those contained in the summary
furnished to Landlord pursuant to Section 8.07. Tenant shall not (a) advertise
------------
or publicize in any way the availability of the Premises without prior notice to
Landlord of Tenant's intention to sublet space, or (b) list the Premises for
subletting, whether through a broker, agent, representative or otherwise at a
rental rate less than the Fixed Rent and Additional Charges at which Landlord is
then offering to lease comparable space in the Project.
8.13. Except for any subletting by Tenant to Landlord or its designee
pursuant to the provisions of this Article, each subletting pursuant to this
Article shall be subject to all of the covenants, agreements, terms, provisions
and conditions contained in this Lease. Notwithstanding any such subletting to
Landlord or any such subletting to any other subtenant and/or acceptance of rent
or additional rent by Landlord from any subtenant, Tenant shall and will remain
fully liable for the payment of the Fixed Rent and Additional Charges due and to
become due hereunder and, subject to Section 8.09(f), for the performance of
---------------
all the covenants, agreements, terms, provisions and conditions contained in
this Lease on the part of Tenant to be performed and all acts and omissions of
any licensee or subtenant or anyone claiming under or through any subtenant
which shall be in violation of any of the obligations of this Lease, and any
such violation shall be deemed to be a violation by Tenant. Tenant further
agrees that notwithstanding any such subletting, no other and further subletting
of the Premises by Tenant or any person claiming through or under Tenant (except
as provided in Section 8.09) shall or will be made except upon compliance with
------------
and subject to the provisions of this Article. If Landlord shall decline to
give its consent to any proposed assignment or sublease, or if Landlord shall
exercise any of its options under Section 8.07, Tenant shall indemnify, defend
------------
and hold harmless Landlord against and from any and all loss, liability,
damages, costs and expenses (including reasonable counsel fees) resulting from
any claims that may be made against Landlord by the proposed assignee or
sublessee or by any brokers or other persons claiming a commission or similar
compensation in connection with the proposed assignment or sublease.
8.14. If (a) Landlord fails to exercise all of its options under
Section 8.07 and Landlord consents to a proposed assignment or sublease, and (b)
------------
Tenant fails to execute and deliver the assignment or sublease to which Landlord
consented within 90 days after the giving of such consent, then Tenant shall
again comply with all of the provisions and conditions of Section 8.07 before
------------
assigning this Lease or subletting all or any part of the Premises.
25
8.15. With respect to each and every sublease or subletting
authorized by Landlord under the provisions of this Lease, it is further agreed
that:
(a) No subletting shall be for a term ending later than one day
prior to the expiration date of this Lease.
(b) No sublease shall be valid, and no subtenant shall take
possession of the Premises or any part thereof, until an executed
counterpart of such sublease has been delivered to Landlord.
(c) Each sublease shall provide that it is subject and
subordinate to this Lease and to the matters to which this Lease is or
shall be subordinate, and that in the event of termination, reentry or
dispossess by Landlord under this Lease Landlord may, at its option, take
over all of the right, title and interest of Tenant, as sublessor, under
such sublease, and such subtenant shall, at Landlord's option, attorn to
Landlord pursuant to the then executory provisions of such sublease, except
that Landlord shall not (i) be liable for any previous act or omission of
Tenant under such sublease, (ii) be subject to any offset which theretofore
accrued to such subtenant against Tenant, or (iii) be bound by any previous
modification of such sublease or by any previous prepayment of more than
one month's rent.
(d) If (i) a subtenant of Tenant, under a sublease for which
Landlord's consent is required hereunder and has been obtained, has a
minimum net worth calculated in accordance with generally accepted
accounting principles equal to at least six times the aggregate of the
annual fixed rent, operating payments and tax payments provided for in such
sublease, (ii) such sublease (A) has a term of five (5) years or more, (B)
provides for the demise of at least 50% of the rentable area of the
Premises and (C) provides on a per rentable square foot basis for a fixed
rental and additional rent equal to or greater than the Fixed Rent and
Additional Charges provided for in this Lease (or which provides for the
escalation of such subtenant's rental to such level at such time as it
seeks to invoke the protections of this Section), and (iii) Landlord shall
be reimbursed for its reasonable out-of-pocket costs in connection
therewith (including, without limitation, reasonable legal fees), then
Landlord shall execute and deliver to such subtenant, at the time such
sublease is made, a non-disturbance agreement in form reasonably
satisfactory to Landlord, confirming Landlord's agreement hereunder to
recognize such subtenant as the direct tenant of Landlord upon the
termination of this Lease by reason of a default by Tenant, provided that
at the time of the termination of this Lease (x) no default exists under
the subtenant's sublease which would then permit the landlord thereunder to
terminate the sublease or to exercise any dispossess remedy provided for
therein and (y) the subtenant will
26
deliver to Landlord an instrument confirming the agreement of the subtenant
to attorn to Landlord and to recognize Landlord as such subtenant's
landlord under the sublease, which instrument shall provide that neither
Landlord nor anyone claiming by, through or under Landlord, shall be:
(1) liable for any act or omission of any prior landlord
(including the then-defaulting landlord),
(2) subject to any offsets or defenses which the subtenant may
have against any prior landlord (including the then-defaulting landlord),
(3) bound by any payment of rent which the subtenant might have
made for more than one (1) month in advance of the due date of any
corresponding rental obligation under this Lease to any prior landlord
(including the then-defaulting landlord),
(4) liable for any security deposited by such subtenant which has
not been transferred as such to Landlord,
(5) bound by any covenant to undertake or complete any
construction of the premises demised by said sublease,
(6) bound by any obligation to make any payment to the subtenant,
except for services, repairs, maintenance and restoration provided for
under the sublease to be performed after the date of such termination of
this Lease to the extent Landlord would be obligated to perform the same
under this Lease, or
(7) bound by any modification of the sublease to which Landlord
shall have not consented in writing.
8.16. If Landlord gives its consent to any assignment of this Lease
or to any sublease, Tenant shall, in consideration therefor, pay to Landlord, as
Additional Charges, one-half of:
(a) in the case of an assignment, an amount equal to (i) all
sums and other considerations paid to Tenant by the assignee for or by
reason of such assignment (including, without limitation, sums paid for the
sale of Tenant's fixtures, leasehold improvements, leasehold equipment,
furniture, furnishings or other personal property, less the then net
unamortized or undepreciated cost thereof determined on the basis of
Tenant's federal income tax returns; but excluding sums, not exceeding the
fair market value, paid for the sale of Tenant's laboratory or other
similar technical or movable equipment); minus (ii) Tenant's reasonable
out-of-pocket costs of effectuating such assignment (including, without
limitation, brokerage fees, attorneys' fees and the cost of alterations
performed for the assignee); and
27
(b) in the case of a sublease, (i) any rents, additional charges
or other consideration payable under the sublease to Tenant by the
subtenant which is in excess of the Fixed Rent and Additional Charges
accruing during the term of the sublease in respect of the subleased space
(at the rate per square foot payable by Tenant hereunder) pursuant to the
terms hereof (including, without limitation, sums paid for the sale or
rental of Tenant's fixtures, leasehold improvements, equipment, furniture,
furnishings or other personal property, less, in the case of the sale
thereof, the then net unamortized or undepreciated cost thereof determined
on the basis of Tenant's federal income tax returns, which net unamortized
or undepreciated cost shall be deducted from the sums paid in connection
with such sale in equal monthly installments over the balance of the term
of the sublease); minus (ii) Tenant's reasonable out-of-pocket costs of
effectuating such sublease (including, without limitation, brokerage fees,
attorneys' fees and the cost of alterations performed for the subtenant),
which costs shall be amortized and deducted in equal monthly installments
over the balance of the term of the sublease. The sums payable under this
subdivision (b) shall be paid to Landlord as and when paid by the subtenant
---------------
to Tenant.
ARTICLE 9 - COMPLIANCE WITH LEGAL AND INSURANCE REQUIREMENTS
9.01. Tenant shall give prompt notice to Landlord of any notice it
receives of the violation of any Legal Requirements or Insurance Requirements
with respect to the Premises or the use or occupation thereof. Tenant shall, at
Tenant's expense, comply with all Legal Requirements and Insurance Requirements
which shall, in respect of the Premises or the use and occupation thereof, or
the abatement of any nuisance in, on or about the Premises, impose any
violation, order or duty on Landlord or Tenant, arising from (a) Tenant's use of
the Premises (other than as permitted hereunder), (b) the manner of conduct of
Tenant's business or operation of its installations, equipment or other property
therein, (c) any cause or condition created by or at the instance of Tenant
(other than as expressly permitted hereunder), or (d) breach of any of Tenant's
obligations hereunder, and Tenant shall pay all the costs, expenses, fines,
penalties and damages which may be imposed upon Landlord or any Superior Lessor
or Superior Mortgagee by reason of or arising out of Tenant's failure to fully
and promptly comply with and observe the provisions of this Section. However,
Tenant need not comply with any such Legal Requirements and Insurance
Requirements so long as Tenant is contesting the validity thereof, or the
applicability thereof to the Premises, in accordance with Section 9.02. Subject
------------
to the provisions of Section 9.03, Landlord, at its expense, shall comply with
------------
all other Legal Requirements and Insurance Requirements as shall affect the
Premises and the Project, but may similarly defer compliance so long as Landlord
shall be contesting the validity or applicability thereof (but only so long as
Landlord's contest shall not subject Tenant to criminal penalty, invalidate
Tenant's insurance
28
or otherwise materially interfere with Tenant's conduct of business in the
Premises for the uses permitted under this Lease).
9.02. Tenant, at its expense, after notice to Landlord, may contest,
by appropriate proceedings prosecuted diligently and in good faith, the
validity, or applicability to the Premises, of any Legal Requirements and
Insurance Requirements, provided that (a) neither Landlord nor any Superior
Mortgagee or Superior Lessor shall be subject to criminal penalty or to
prosecution for a crime, nor shall the Premises or any part thereof be subject
to being condemned or vacated, by reason of noncompliance or otherwise by reason
of such contest; (b) before the commencement of such contest, Tenant shall
furnish to Landlord such security as shall be reasonably satisfactory to
Landlord and all Superior Mortgagees, and Tenant shall indemnify Landlord and
any Superior Mortgagees and Superior Lessors against the cost thereof and
against all liability for damages, interest, penalties and expenses (including
reasonable attorneys' fees and expenses), resulting from or incurred in
connection with such contest or noncompliance; (c) such noncompliance or contest
shall not constitute or result in any violation of any Superior Lease or
Superior Mortgage, or if any such Superior Lease or Superior Mortgage shall
permit such noncompliance or contest on condition of the taking of action or
furnishing of security by Landlord, such action shall be taken and such security
shall be furnished at the expense of Tenant; and (d) Tenant shall keep Landlord
advised as to the status of such proceedings. Without limiting the application
of the above, Landlord and/or a Superior Mortgagee and/or Superior Lessor shall
be deemed subject to prosecution for a crime if Landlord or the Superior
Mortgagee or Superior Lessor or any managing agent for the Project, or any
officer, director, partner, shareholder or employee of Landlord or a Superior
Mortgagee or Superior Lessor or any managing agent for the Project, as an
individual, is charged with a crime of any kind or degree whatever, whether by
service of a summons or otherwise, unless such charge is withdrawn before
Landlord or the Superior Mortgagee or Superior Lessor or any managing agent for
the Project, or such officer, director, partner, shareholder or employee of
Landlord or the Superior Mortgagee or Superior Lessor or any managing agent for
the Project (as the case may be) is required to plead or answer thereto.
9.03. If (i) Landlord or any Superior Mortgagee or Superior Lessor is
required under this Lease or pursuant to law to comply with any Legal
Requirements or Insurance Requirements affecting the Pre mises which arise from
laws first enacted or imposed after the date hereof, (ii) the cost of such
compliance throughout the Project is reasonably expected to exceed $25,000,000,
(iii) Landlord does not have the financial resources to pay such cost, (iv)
Tenant's occupancy of the Premises without such compliance will subject
individuals who are officers, directors or owners of Landlord (or of a direct or
indirect owner of Landlord) to civil or criminal penalty, and (v) Landlord also
elects to terminate the other leases of space in the Project under which the
requirement to so comply gives Landlord an option to so terminate, then Landlord
may, at its option, elect to terminate this Lease by (x) giving not less than
120 days' notice
29
thereof to Tenant, and (y) paying to Tenant, on or before such termination date,
an amount equal to Tenant's reasonable moving expenses plus the amounts expended
by Tenant for installations and improvements to the Premises in excess of the
Landlord's Contribution (allocable proportionately to what would have been the
remaining portion of the original Term). If Tenant gives notice to Landlord,
within 60 days after the giving by Landlord of such notice of termination, that
Tenant shall cause the required repairs or alterations to be made at Tenant's
expense, then (a) such notice of termination shall be ineffective, and (b)
Tenant shall, at Tenant's expense, promptly and diligently cause such repairs or
alterations to be performed and shall indemnify and hold harmless Landlord and
the Superior Mortgagees and Superior Lessors from any and all costs, expenses,
penalties and/or liabilities in connection therewith. The provisions of Article
-------
12 hereof, to the extent applicable, shall apply to the work (and the plans and
--
specifications therefor) which Tenant shall be required to perform or cause to
be performed under this Section.
ARTICLE 10 - INSURANCE
10.01. Tenant shall not violate, or permit the violation of, any
Insurance Requirements and shall not do, or permit anything to be done, or keep
or permit anything to be kept in the Premises which would subject Landlord or
any Superior Mortgagee or Superior Lessor to any liability or responsibility for
bodily injury or death or property damage, or which would increase any insurance
rate in respect of insurance maintained by or for the benefit of Landlord over
the rate which would otherwise then be in effect or which would result in
insurance companies of good standing refusing to insure all or any part of the
Project or any contents thereof in amounts reasonably satisfactory to Landlord,
or which would result in the cancellation of or the assertion of any defense by
the insurer in whole or in part to claims under any policy of insurance in
respect of the Project. Landlord represents that the permitted uses of the
Premises under Section 2.01 will not violate this Section 10.01.
------------ -------------
10.02. If, by reason of any failure of Tenant to comply with the
provisions of Section 9.01 or Section 10.01, the premiums on insurance
------------ -------------
maintained by or for the benefit of Landlord shall be higher than they otherwise
would be, Tenant shall reimburse Landlord, on demand, for that part of such
premiums attributable to such failure on the part of Tenant. A schedule or
"make up" of rates for insurance maintained by or for the benefit of Landlord
issued by the New York Fire Insurance Rating Organization or other similar body
making rates for such insurance shall be conclusive evidence of the facts
therein stated and of the several items and charges in the insurance rate then
applicable to such insurance.
10.03. Tenant, at its expense, shall maintain at all times during the
Term (a) "all risk" property insurance covering the Tenant's Property
(hereinafter defined) with a limit of not less than 80% of the replacement cost
thereof, and (b) commercial general
30
liability insurance, including a contractual liability endorsement, in respect
of the Premises and the conduct or operation of business therein, with Landlord
and its managing agent, if any, and any Superior Lessors and Superior
Mortgagees, including, without limitation, Swiss Bank and Carbide, whose names
and addresses shall have been furnished to Tenant, as additional insureds, with
limits of not less than $3,000,000 combined single limit bodily injury and
property damage liability. The limits of such insurance shall not limit the
liability of Tenant hereunder. Tenant shall deliver to Landlord and any
additional insureds certificates and copies of the binders for such insurance in
form reasonably satisfactory to Landlord issued by the insurance company or its
authorized agent no later than 10 days before the Commencement Date and prior to
the commencement of any work by Tenant. Tenant shall procure and pay for
renewals of such insurance from time to time before the expiration thereof, and
Tenant shall deliver to Landlord and any additional insureds certificates and
copies of the binders for such renewal policy issued by the insurance company or
its authorized agent at least 30 days before the expiration of any existing
policy. All such policies shall be issued by companies licensed to do business
in New York State and reasonably satisfactory to Landlord. All such policies
shall be noncancellable in respect of Landlord and any additional insureds
unless 30 days' prior written notice is given to Landlord and all additional
insureds and all such policies shall provide that no act or omission of Tenant
shall affect or limit the obligations of the insurer in respect of Landlord and
the additional insureds.
10.04. Each party agrees to have included in each of its insurance
policies (insuring the Building and Landlord's property therein in the case of
Landlord, and insuring the Tenant's Property in the Premises in the case of
Tenant, against loss, damage or destruction by fire or other casualty) a waiver
of the insurer's right of subrogation against the other party during the Term
or, if such waiver is unobtainable or unenforceable, (a) an express agreement
that such policy shall not be invalidated if the insured waives the right of
recovery against any party responsible for a casualty covered by the policy
before the casualty, or (b) any other form of permission for the release of the
other party. If such waiver, agreement or permission shall not be, or shall
cease to be, obtainable from either party's then current insurance company, the
insured party shall so notify the other party promptly after learning thereof,
and shall use its best efforts to obtain the same from another insurance company
described in Section 10.03. If such waiver, agreement or permission is
-------------
obtainable only by payment of an additional charge, the insured party shall so
notify the other party promptly after learning thereof, and the insured party
shall not be required to obtain said waiver, agreement or permission unless the
other party pays the additional charge therefor. Each party hereby releases the
other, in respect of any claim (including a claim for negligence) which it might
otherwise have against the other for loss, damage or destruction in respect of
its property occurring during the Term to the extent to which it is insured
under a policy or policies containing a waiver of subrogation or permission to
release liability, as provided in the preceding
31
sentences of this Section. Nothing contained in this Section shall be deemed to
relieve either party of any duty imposed elsewhere in this Lease to repair,
restore or rebuild or to nullify any abatement of rents provided for elsewhere
in this Lease.
10.05. Landlord may from time to time, but not more frequently than
once every five years, require that the amount of commercial general liability
insurance to be maintained by Tenant under Section 10.03 be reasonably
-------------
increased, so that the amount thereof adequately protects Landlord's interest.
10.06. Landlord shall maintain at all times during the Term (i) "all
risk" property insurance covering the Building (excluding Tenant's Property) for
its full insurable value (subject to commercially reasonable deductibles) and
(ii) commercial general liability insurance with a combined single limit of not
less than $50,000,000.
ARTICLE 11 - RULES AND REGULATIONS
11.01. Tenant and its employees and agents shall faithfully observe
and comply with the rules and regulations attached hereto as Exhibit C, and such
---------
reasonable changes therein (whether by modification, elimination or addition) as
Landlord at any time or times hereafter makes and communicates to Tenant, which,
in Landlord's reasonable judgment, shall be necessary for the reputation,
safety, care and appearance of the Project, or the preservation of good order
therein, or the operation or maintenance of the Project or its equipment and
fixtures, and which do not materially adversely affect the conduct of Tenant's
business in the Premises or Tenant's rights hereunder (such rules and
regulations as changed from time to time being herein called the "Rules and
Regulations"); provided, however, that in case of any conflict or inconsistency
between the provisions of this Lease and any of the Rules and Regulations, the
provisions of this Lease shall control.
11.02. Nothing in this Lease shall be construed to impose upon
Landlord any duty or obligation to enforce the Rules and Regulations against any
other tenant or any employees or agents of any other tenant, and Landlord shall
not be liable to Tenant for violation of the Rules and Regulations by any other
tenant or its employees, agents, invitees or licensees. Landlord agrees not to
enforce the Rules and Regulations against Tenant in an arbitrary or
discriminatory manner.
ARTICLE 12 - ALTERATIONS
12.01. Tenant may from time to time, at its expense, make alterations
(herein called the "Alterations") in and to the Premises, excluding structural
changes, provided and upon condition that: (a) the outside appearance of the
Building shall not be affected; (b) the Alterations are nonstructural and the
strength of the Building shall not be affected; (c) the Alterations are to the
interior of the
32
Premises and no part of the Building outside of the Premises shall be
affected; (d) the proper functioning of the mechanical, electrical,
sanitary and other service systems of the Building shall not be adversely
affected and the usage of such systems by Tenant shall not be increased; (e)
before proceeding with any Alteration which will cost more than $100,000
(excluding decorative items), Tenant shall submit to Landlord for Landlord's
approval (which shall not be unreasonably withheld if the approval of all
Superior Mortgagees whose Superior Mortgages require the approval of the
Superior Mortgagee shall have been obtained or deemed obtained thereunder; and
which Superior Mortgagee approval Landlord shall use diligent efforts to obtain)
two sets of plans and specifications for the work to be done, and Tenant shall
not proceed with such work until it obtains such approval; (f) except in the
case of the Work (as defined in Section 3.03) and the Offered Space Work (as
------------
defined in Section 42.03(b)), Tenant shall pay to Landlord upon demand
----------------
Landlord's actual and reasonable out-of-pocket cost and expense of Landlord in
(i) reviewing said plans and specifications and (ii) inspecting the Alterations
to determine whether the same are being performed in accordance with the
approved plans and specifications and all Legal Requirements and Insurance
Requirements, including, without limitation, the fees or cost of any architect,
engineer or draftsman, including the cost, based upon the actual salaries and
fringe benefits of architects, engineers or draftsmen who are employees of
Landlord, for such purposes, and a 10% administrative charge; (g) before
proceeding with any Alteration which will cost more than $500,000 (exclusive of
the costs of decorating work and items constituting the Tenant's Property), as
estimated, at Tenant's expense, by a reputable contractor reasonably
satisfactory to Landlord and all Superior Mortgagees, Tenant shall obtain and
deliver to Landlord such security as shall be reasonably satisfactory to
Landlord and all Superior Mortgagees (which security may consist of a payment
and performance bond or letter of credit in customary amount from Tenant's
contractor); and (h) Tenant shall fully and promptly comply with and observe the
Rules and Regulations of Landlord then in force with respect to the making of
the Alterations. Tenant agrees that any review or approval by Landlord of any
plans and/or specifications with respect to any Alterations is solely for
Landlord's benefit, and without any representation or warranty whatsoever to
Tenant with respect to the adequacy, correctness or efficiency thereof or
otherwise.
12.02. Tenant, at its expense, shall obtain all necessary
governmental permits and certificates for the commencement and prosecution of
the Alterations and for final approval thereof upon completion, and shall cause
the Alterations to be performed in compliance therewith and with all applicable
Legal Requirements and Insurance Requirements. The Alterations shall be
diligently performed in a good and workmanlike manner, using new materials and
equipment at least equal in quality and class to the original installations. The
Alterations shall be performed by contractors first approved by Landlord under
the supervision of a licensed architect. The Alterations shall be performed in
such a manner as not to violate
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union contracts affecting the Project, or create any work stoppage, picketing,
labor disruption or dispute or any interference with the business of Landlord or
any tenant of the Project. In addition, the Alterations shall be performed in
such a manner as not to otherwise unreasonably interfere with or delay and as
not to impose any additional expense upon Landlord in the construction,
maintenance, repair, operation or cleaning of the Project, and if any such
additional expense shall be incurred by Landlord as a result of Tenant's
performance of the Alterations, Tenant shall pay such additional expense to
Landlord on demand. Throughout the performance of the Alterations, Tenant shall
carry, or cause its contractors to carry, workers' compensation insurance in
statutory limits, "Builder's Risk" insurance reasonably satisfactory to
Landlord, and commercial general liability insurance, with completed operation
endorsement, for any occurrence in or about the Project, under which Landlord
and its managing agent and any Superior Lessors and Superior Mortgagees, whose
names and addresses were furnished to Tenant shall be named as additional
insureds, in such limits as Landlord may reasonably require, with insurers
reasonably satisfactory to Landlord. Tenant shall furnish Landlord with
reasonably satisfactory evidence that such insurance is in effect before the
commencement of the Alterations and, on request, at reasonable intervals during
the continuance of the Alterations. If any Alterations involve the removal of
any fixtures, equipment or other property in the Premises which are not Tenant's
Property, such removed fixtures, equipment or other property shall be either (i)
offered by Tenant to Landlord for Landlord to keep and store, or (ii) replaced
prior to the end of the Term at Tenant's expense with fixtures, equipment or
other property of like utility and at least equal value. Upon completion of any
Alterations (other than mere decorations) Tenant shall deliver to Landlord
scaled and dimensioned reproducible mylars of "as-built" plans for such
Alteration.
12.03. Tenant, at its expense, and with diligence and dispatch, shall
procure the cancellation or discharge of all notices of violation arising from
or otherwise connected with the Alterations, or any other work, labor, services
or materials done for or supplied to Tenant, or any person claiming through or
under Tenant, which shall be issued by the County of Westchester or the Town of
Greenburgh or the Town of Mount Pleasant or any other public authority having or
asserting jurisdiction. Tenant shall indemnify and save harmless Landlord and
any Superior Mortgagees and Superior Lessors from and against any and all
mechanics' and other liens and encumbrances filed in connection with the
Alterations, or any other work, labor, services or materials done for or
supplied to Tenant, or any person claiming through or under Tenant, including,
without limitation, security interests in any materials, fixtures or articles so
installed in and constituting part of the Premises and against all costs,
expenses and liabilities incurred in connection with any such lien or
encumbrance or any action or proceeding brought thereon. Tenant, at its
expense, shall procure the satisfaction or discharge of record of all such liens
and encumbrances within 25 days after the filing thereof. However, nothing
herein contained shall prevent Tenant from
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contesting, in good faith and at its own expense, any notice of violation,
provided that Tenant shall comply with the provisions of Section 9.02.
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ARTICLE 13 - LANDLORD'S AND TENANT'S PROPERTY
13.01. All built-in fixtures, improvements and appurtenances,
including, without limitation, utility lines built into the Premises at the
commencement of or during the Term, whether or not by or at the expense of
Tenant, shall be and remain a part of the Premises, shall be deemed the property
of Landlord and shall not be removed by Tenant, except as provided in Section
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13.02. Further, any carpeting or other personal property in the Premises on the
-----
Commencement Date, unless constituting Tenant's Property pursuant to Section
13.02, shall be and shall remain Landlord's property and shall not be removed by
Tenant.
13.92 All movable partitions, business and trade fixtures, machinery
and equipment, communications equipment and office equipment, whether or not
attached to or built into the Premises, which are installed in the Premises by
or for the account of Tenant without expense to Landlord and can be removed
without structural damage to the Building, and all furniture, furnishings and
other articles of movable personal property owned by Tenant and located in the
Premises (herein collectively called the "Tenant's Property") shall be and shall
remain the property of Tenant and may be removed by Tenant at any time during
the Term; provided that if any of the Tenant's Property is removed, Tenant shall
repair or pay the cost of repairing any damage to the Premises or to the
Building resulting from the installation and/or removal thereof. Any equipment
or other property for which Landlord shall have granted any allowance or credit
to Tenant shall not be deemed to have been installed by or for the account of
Tenant without expense to Landlord, shall not be considered the Tenant's
Property, and shall be deemed the property of Landlord.
13.03. At or before the expiration date of this Lease, or within
15 days after the date of any earlier termination of this Lease, Tenant, at its
expense, shall remove from the Premises all of the Tenant's Property, and Tenant
shall repair any damage to the Premises or the Building resulting from any
installation and/or removal of the Tenant's Property. Any other items of the
Tenant's Property which shall remain in the Premises after the expiration date
of this Lease, or after a period of 15 days following an earlier termination
date, may, at the option of Landlord, be deemed to have been abandoned, and in
such case such items may be retained by Landlord as its property or disposed of
by Landlord, without accountability, in such manner as Landlord shall determine
at Tenant's expense.
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ARTICLE 14 - REPAIRS AND MAINTENANCE
14.01. Tenant shall, at its expense, throughout the Term, take good
care of the Premises, the fixtures and appurtenances therein and the Tenant's
Property. Tenant shall be responsible for all repairs and replacements, interior
and exterior, structural and nonstructural, ordinary and extraordinary, in and
to the Premises and the Building and the facilities and systems thereof, the
need for which arises out of (a) the performance or existence of any work by
Tenant or Alterations, (b) the installation, use or operation of the Tenant's
Property in the Premises, (c) the moving of the Tenant's Property in or out of
the Premises or the Building, or (d) the act, omission, misuse or neglect of
Tenant or any of its subtenants or its or their employees, agents, contractors
or invitees. Tenant, at its expense, shall promptly repair or replace all
scratched, damaged or broken doors and glass in and about the Premises and shall
be responsible for all repairs, painting, maintenance and replacement of wall
and floor coverings in the Premises and for the repair and maintenance of all
sanitary and electrical fixtures and equipment therein. Tenant shall promptly
make, at Tenant's expense, all repairs in or to the Premises for which Tenant is
responsible. Any repairs required to be made by Tenant to the mechanical,
electrical, sanitary, heating, ventilating, air-conditioning or other systems of
the Building shall be performed only by contractor(s) approved by Landlord. Any
other repairs in or to the Building and the facilities and systems thereof for
which Tenant is responsible, may be performed by Landlord at Tenant's expense.
14.02. Landlord shall make all repairs and replacements, structural
and otherwise, interior and exterior, as and when needed in or about the
Premises and the Building (and the adjacent Land) in order to maintain the
Building in a first-class condition, and shall maintain the heating, ventilating
and air conditioning, plumbing and electrical systems of the Building; except
for those repairs and replacements for which Tenant is responsible pursuant to
any of the provisions of this Lease.
14.03. Except as otherwise expressly provided in this Lease, Landlord
shall have no liability to Tenant, nor shall Tenant's covenants and obligations
under this Lease be reduced or abated in any manner whatsoever, by reason of any
inconvenience, annoyance, interruption or injury to business arising from
Landlord's making any repairs or changes which Landlord is required by this
Lease, or required by law, to make in or to any portion of the Building or the
Premises, or in or to the fixtures, equipment or appurtenances of the Building
or the Premises. However, Landlord shall use reasonable efforts to minimize
interference with the conduct of Tenant's business in the Premises in connection
with the foregoing, including, to the extent appropriate, the use of overtime
labor.
ARTICLE 15 - ELECTRIC ENERGY
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15.01. Subject to the provisions of this Article, Landlord shall
furnish the electric energy that Tenant shall reasonably require in the Premises
for the purposes permitted under this Lease. Except for electric energy required
to operate motors on the air handlers providing heat, ventilating and
conditioning to the Premises ("HVAC Electric"), such electric energy shall be
furnished through a meter or meters and related equipment, installed by Landlord
at its expense and maintained by Landlord at Tenant's expense, measuring the
amount of electric energy furnished to the Premises. Tenant shall pay Landlord
for such electric energy as Additional Charges, within ten days after Landlord
bills Tenant therefor, which bills shall be rendered not more often than
monthly. The amount of such Additional Charges (a) for HVAC Electric shall be
Landlord's actual cost and (b) for other electric energy furnished to the
Premises ("Basic Electric") shall be based upon rates equal to the rates that
would be applicable if such electric energy were supplied directly to Tenant
through a meter or meters on a direct meter basis by the public utility company
then supplying electric energy to the area of Westchester County in which the
Premises are located (even if such electric energy is not generated by such
public utility company but is privately generated); provided that such
Additional Charges for Basic Electric shall in no event be based on rates that
are more than the average of the rates at which Landlord purchases electric
energy for the Project directly from such public utility company (taking into
account the benefit of any "business incentive rate" that is payable by
Landlord); including in each case, without limitation, those charges applicable
to or computed on the basis of electric consumption, demand and hours of use,
any sales or other taxes regularly passed on to or collected from similar
consumers by such public utility company, fuel rate adjustments and surcharges,
and weighted in each case to reflect differences in consumption or demand
applicable to each rate level. Tenant and its authorized representatives may
have access to such meter or meters on at least three days' notice to Landlord,
for the purposes of verifying Landlord's meter readings. From time to time
during the Term of this lease, Landlord may, in its sole discretion, increase or
reduce the number of, such meters or vary the portions of the Premises which
they serve or replace any or all of such meters.
15.02. If pursuant to any Legal Requirements, the charges to Tenant
pursuant to Section 15.01 shall be reduced below that to which Landlord is
-------------
entitled under such Section, the deficiency shall be paid by Tenant within 10
days after being billed therefor, as additional rent for the use and maintenance
of the electric distribution system of the Building.
15.03. Landlord shall not be liable in any event to Tenant for any
failure or defect in the supply or character of electric energy furnished to the
Premises by reason of any requirement, act or omission of the public utility
serving the Building with electric energy or for any other reason to the extent
not attributable to Landlord's willful misconduct or gross negligence.
37
15.04. Landlord shall furnish and install all replacement lighting
tubes, lamps, bulbs and ballasts required in the Premises, and Tenant shall pay
to Landlord or its designated contractor upon demand the then established
reasonable charges therefor of Landlord or its designated contractor, as the
case may be.
15.05. Tenant's use of electric energy in the Premises shall not at
any time exceed the capacity of any of the electrical conductors and equipment
in or otherwise serving the Premises. In order to insure that such capacity is
not exceeded and to avert possible adverse effect upon the Building's
distribution of electricity via the Building's electric system, Tenant shall
not, without Landlord's prior consent in each instance (which shall not be
unreasonably withheld, based upon availability of electric energy in the
Building as allocated by Landlord to various areas of the Building) connect any
fixtures, appliances or equipment (other than normal business machines which do
not materially increase Tenant's electrical consumption) to the Building's
electric system or make any alterations or additions to the electric system of
the Premises existing on the Commencement Date. Should Landlord grant such
consent, all additional risers or other equipment required therefor shall be
provided by Landlord and the cost thereof shall be paid by Tenant to Landlord on
demand. Landlord shall have the right to require Tenant to pay sums on account
of such cost prior to the installation of any such risers or equipment.
Notwithstanding the foregoing, Landlord's consent to any Alterations pursuant to
Article 12 shall be deemed consent to the connection to the Building's electric
system of the fixtures, appliances and equipment specified in plans for such
Alterations.
15.06. If required by any Legal Requirements, Landlord, upon at least
sixty days' notice to Tenant (and after Tenant is able and the Premises are
equipped to receive electric energy directly from the utility company, as
hereinafter provided), may discontinue Landlord's provision of electric energy
(or either HVAC Electric or Basic Electric, as the case may be) hereunder. If
Landlord discontinues provision of electric energy pursuant to this Section,
Tenant shall not be released from any liability under this Lease, except that as
of the date of such discontinuance, Tenant's obligation to pay Landlord
Additional Charges under Section 15.01 for electric energy (or either HVAC
-------------
Electric or Basic Electric, as the case may be) thereafter supplied to the
Premises shall cease. As of such date, Landlord shall permit Tenant to receive
electric energy directly from the public utility company supplying electric
energy to the Project, and Tenant shall pay all costs and expenses of obtaining
such direct electrical service. Such electric energy may be furnished to Tenant
by means of the then existing Building system feeders, risers and wiring to the
extent that the same are available, suitable and safe for such purpose. All
meters and additional panel boards, feeders, risers, wiring and other conductors
and equipment which may be required to obtain electric energy directly from such
public utility company shall be furnished and installed by Landlord at
Landlord's expense.
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ARTICLE 16 - HEAT, VENTILATION AND AIR-CONDITIONING
16.01. Landlord shall maintain and operate the heating, ventilating
and air-conditioning systems serving the Premises, and shall furnish heat,
ventilating and air-conditioning (herein called "HVAC") in the Premises as may
be reasonably required (except as otherwise provided in this Lease and except
for any special requirements of Tenant arising from its particular use of the
Premises) for reasonably comfortable occupancy of the Premises during Business
Hours of Business Days and sufficient to maintain the air temperature in the
Premises within the ranges set forth in Exhibit E. If Tenant shall require heat
---------
or air-conditioning service at any other time, Landlord shall furnish such
service for such times ("Overtime Hours") upon not less than 48 hours advance
notice from Tenant. Tenant shall pay Landlord for HVAC as Additional Charges,
within ten days after Landlord bills Tenant therefor, which bills shall be
rendered not more often than monthly. The amount of such Additional Charges for
a given period of time shall be equal to the total actual cost to Landlord of
delivering steam and chilled water for the Premises for the Business Hours and
Overtime Hours of Tenant in such period. Landlord's current charges for HVAC
during Business Hours and Overtime Hours are as set forth in Exhibit E. HVAC
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charges shall not include any costs or expenses which are included in Operating
Expenses. Costs and expenses included in HVAC charges shall be subject to the
same conditions and limitations as are applicable to similar types of expenses
included in Operating Expenses (e.g., any capital costs included therein are to
be amortized with interest over useful life for tax purposes).
16.02. The performance by Landlord of its obligations under Section
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16.01 is subject to Tenant's compliance with the conditions of occupancy and
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connected load established by Landlord. Use of the Premises, or any part
thereof, in a manner exceeding the HVAC design conditions (including occupancy
and connected electrical load), or rearrangement of partitioning which
interferes with normal operation of the HVAC in the Premises, or the use of
computer or data processing machines or other machines or equipment, may require
changes in the heating, ventilating and/or air-conditioning systems servicing
the Premises, in order to provide comfortable occupancy. Such changes, so
occasioned, shall be made by Tenant, at its expense, as Alterations in
accordance with the provisions of Article 12, but only to the extent permitted
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and upon the conditions set forth in that Article.
ARTICLE 17 - OTHER SERVICES; SERVICE INTERRUPTION
17.01. Landlord shall furnish adequate hot and cold water to the
Premises for drinking, lavatory and cleaning purposes. If Tenant uses water for
any other purpose (such as laboratory purpose), Landlord may install and
maintain, at Tenant's expense, meters to measure Tenant's consumption of cold
water and/or hot water for such other purposes. Tenant shall reimburse Landlord
for its actual cost of supplying the quantities of cold water and hot water
shown on such meters on demand.
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17.02. Landlord shall cause the Premises, including the exterior
and the interior of the windows thereof but excluding any laboratory space
(other than desks, floors and paper trash baskets), to be cleaned in a manner
standard to the Building, in accordance with the specifications attached hereto
as Exhibit G. Tenant shall pay to Landlord on demand the costs incurred by
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Landlord for (a) extra cleaning work in the Premises (i.e., in addition to that
included in such specifications) required because of (i) misuse or neglect on
the part of Tenant or its subtenants or its or their employees or visitors, (ii)
the use of portions of the Premises for special purposes requiring greater or
more difficult cleaning work than office areas, (iii) interior glass partitions
or unusual quantity of interior glass surfaces, (iv) special materials or
finishes on items installed by Tenant or its subtenants or its or their
employees or visitors or at its or their request; and (v) the use of the
Premises by Tenant or its subtenants or its or their employees or visitors other
than during Business Hours on Business Days; and (b) removal from the Premises
and the Building of any refuse or rubbish of Tenant in excess of that ordinarily
accumulated in business office occupancy or at times other than Landlord's
standard cleaning times.
17.03, Landlord, its cleaning contractor and their employees shall
have access to the Premises after 5:30 p.m. and before 8:00 a.m. and shall have
the right to use, without charge therefor, all light, power and water in the
Premises reasonably required to clean the Premises as required under Section
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17.02.
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17.04. If Landlord shall furnish either gas or steam to the Premises,
Landlord shall not be liable in any event to Tenant for any failure or defect in
the supply or character of the gas or steam furnished to the Premises by reason
of any requirement, act or omission of the public utility serving the Building
with steam or for any other reason not attributable to Landlord's willful
misconduct or negligence. Tenant's use of gas or steam in the Premises shall
not at any time exceed the capacity of any of the gas lines and equipment or
steam lines and equipment in or otherwise then serving the Premises.
17.05. Landlord reserves the right, without any liability to Tenant
and without affecting Tenant's covenants and obligations hereunder, to stop or
interrupt or reduce service of any of the heating, ventilating, air-
conditioning, electric, sanitary, elevator, gas, steam, water or other Building
systems serving the Premises, or to stop or interrupt or reduce any other
services required of Landlord under this Lease (whether or not specified in
Article 16 or this Article 17), whenever and for so long as may be necessary, by
---------- ----------
reason of (a) accidents, emergencies, strikes or the occurrence of any of the
other events described in Section 41.04, (b) the making of repairs or changes
-------------
which Landlord is required by this Lease or by law to make, (c) unavailability
of fuel, gas, steam, water, electricity, labor or supplies, or (d) any other
cause beyond Landlord's reasonable control, whether similar or dissimilar, and
not due to Landlord's negligence, willful misconduct, or inability to make
payments.
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ARTICLE 18 - ACCESS AND NAME OF PROJECT
18.01. Except for the space within the inside surfaces of all walls,
hung ceilings, floors, windows and doors bounding the Premises, all of the
Building, including, without limitation, exterior Building walls, core corridor
walls and doors and any core corridor entrances, any terraces or roofs adjacent
to the Premises and any space in or adjacent to the Premises used for shafts,
stacks, pipes, conduits, fan rooms, ducts, electric or other utilities, sinks or
other Building facilities, and the use thereof, as well as reasonable access
thereto through the Premises for the purposes of operation, maintenance,
decoration and repair, are reserved to Landlord.
18.02. Landlord reserves the right, and Tenant shall permit
Landlord, to install, erect, use and maintain pipes, ducts and conduits in and
through the Premises within then existing shafts or conduits, behind or within
existing walls and above then existing hung ceilings only.
18.03. Landlord and its agents shall have the right to enter and/or
pass through the Premises at any time or times, upon reasonable advance notice
(except in the case of emergencies, for which advance notice shall not be
required) (a) to examine the Premises and to show them to actual and prospective
Superior Lessors, Superior Mortgagees, or prospective purchasers, mortgagees or
lessees of the Building, provided that Tenant may require that its
representative accompany Landlord and that access to secure areas be restricted;
and (b) to make such repairs, alterations, additions and improvements in or to
the Premises and/or in or to the Building or its facilities and equipment as
Landlord is required under this Lease to make. Landlord shall be allowed to take
all materials into and on the Premises that may be required in connection
therewith, without any liability to Tenant and without any reduction of Tenant's
covenants and obligations hereunder. Landlord shall not store materials in the
Premises (except during performance of the Work), unless they are confined to
the area in which such alterations, additions and improvements are being
performed. In exercising its rights under this Section 18.03, Landlord shall
-------------
use reasonable efforts to minimize interference with Tenant's conduct of
business in the Premises, including, to the extent appropriate, the use of
overtime labor.
18.04. If at any time any windows of the Premises are temporarily
darkened or obstructed by reason of any repairs, improvements, maintenance
and/or cleaning in or about the Building, or if any part of the Building, other
than the Premises, is temporarily or permanently closed or inoperable, the same
shall be without any reduction or diminution of Tenant's obligations under this
Lease; provided Tenant continues to have a reasonable means of access to the
Premises and the Building continues to be operated as a first-class building.
18.05. During the period of 12 months prior to the expiration date of
this Lease, Landlord and its agents may exhibit the
41
Premises to prospective tenants, upon reasonable advance notice to Tenant; and
Tenant may require that its representative accompany Landlord and that access to
secure areas be restricted.
18.06. If, during the last month of the Term, Tenant has removed
all or substantially all of the Tenant's Property from the Premises, Landlord
may, without notice to Tenant, immediately enter the Premises and alter,
renovate and decorate the same, without reducing or diminishing Tenant's
obligations under this Lease.
18.07. Landlord reserves the right, at any time, without incurring
any liability to Tenant therefor, and without affecting or reducing or
diminishing any of Tenant's obligations hereunder, to make such changes,
alterations, additions and improvements in or to the Building and the fixtures
and equipment thereof, as well as in or to the entrances, doors, halls,
passages, elevators, escalators and stairways thereof, and other public parts of
the Building, as Landlord shall deem necessary or desirable; provided Tenant
continues to have a reasonable means of access to the Premises, the Building
continues to be operated as a first-class building, and Landlord continues to
supply all of the services to the Premises at the capacities specified by this
Lease and otherwise to fulfill its obligations under this Lease.
18.08. Landlord may adopt any name for the Project; provided that
Landlord agrees that it will not adopt the name of any competitor of Tenant as
the name for the Project. Landlord reserves the right to change the name and/or
address of the Project at any time.
18.09. Landlord and its agents shall have the right to permit
access to the Premises at any time, whether or not Tenant shall be present, (a)
by any receiver, trustee, sheriff, marshal or other public official entitled to
(or reasonably believed by Landlord to be entitled to) such access (i) for the
purpose of taking possession of or removing any property of Tenant or of any
other occupant of the Premises, or (ii) for any other lawful purpose, or (b) by
any representative of the fire, police, building, sanitation or other department
or instrumentality of any town, county, city, state or federal government.
Nothing contained in, nor any action taken by Landlord under this Section, shall
be deemed to constitute recognition by Landlord that any person other than
Tenant has any right or interest in this Lease or the Premises.
18.10. If Tenant is not present when for any reason entry into the
Premises is necessary or permissible, after reasonable notice except in the case
of an emergency, Landlord or Landlord's agents may enter same by a master key,
or may forcibly enter same, without rendering Landlord or such agents liable
therefor (if during such entry Landlord or such agents accord reasonable care to
the Tenant's Property), and such entry shall not be deemed an actual or
constructive eviction and shall have no effect upon Tenant's obligations under
this Lease.
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ARTICLE 19 - NOTICE OF OCCURRENCES
19.01. Tenant shall give prompt notice to Landlord of (a) any
occurrence in or about the Premises for which Landlord might be liable, (b) any
fire or other casualty in the Premises, (c) any damage to or defect in the
Premises, including the fixtures, equipment and appurtenances thereof, for the
repair of which Landlord might be responsible, and (d) any damage to or defect
in any part or appurtenance of the Building's sanitary, electrical, heating,
ventilating, air-conditioning, elevator or other systems located in or passing
through the Premises or any part thereof.
ARTICLE 20 - NON-LIABILITY AND INDEMNIFICATION
20.01. Neither Landlord nor any Superior Lessor or Superior Mortgagee
shall be liable to Tenant for any loss, injury or damage to Tenant or to any
other person, or to its or their property, irrespective of the cause of such
injury, damage or loss, except to the extent caused by or resulting from the
negligence or willful misconduct of Landlord or the Superior Lessor or Superior
Mortgagee, in the operation or maintenance of the Premises or the Project.
Neither Landlord nor any Superior Lessor or Superior Mortgagee shall be liable
(a) for any damage caused by other tenants or persons in, on or about the
Project, or (b) even if resulting from negligence or willful misconduct, for
consequential damages of Tenant or any subtenant or licensee of Tenant.
20.02. Notwithstanding any provision to the contrary, Tenant shall
look solely to the estate and property of Landlord in and to the Project
(including any insurance and other proceeds therefrom) in the event of any claim
against Landlord or any partner, director, officer, agent or employee of
Landlord arising out of or in connection with this Lease, the relationship of
Landlord and Tenant or Tenant's use of the Premises, and the liability of
Landlord arising out of or in connection with this Lease, the relationship of
Landlord and Tenant or Tenant's use of the Premises, shall be limited to such
estate and property of Landlord. No other properties or assets of Landlord or
any partner, director, officer, agent or employee of Landlord shall be subject
to levy, execution or other enforcement procedures for the satisfaction of any
judgment (or other judicial process) or for the satisfaction of any other remedy
of Tenant arising out of or in connection with this Lease, the relationship of
Landlord and Tenant or Tenant's use of the Premises, and if Tenant acquires a
lien on or interest in any other properties or assets by judgment or otherwise,
Tenant shall promptly release such lien on or interest in such other properties
and assets by executing, acknowledging and delivering to Landlord an instrument
to that effect prepared by Landlord's attorneys.
20.03. Tenant shall indemnify and hold harmless Landlord and all
Superior Lessors and all Superior Mortgagees, including, without limitation,
Swiss Bank and Carbide, and its and their respective partners, directors,
officers, agents and employees from
43
and against any and all claims arising from or in connection with (a) the
conduct or management of the Premises or of any business therein, or any work or
thing whatsoever done, or any condition created by Tenant or its subtenant or
licensee, or their respective agents, contractors, employees or invitees, in or
about the Premises during the Term or during the period of time, if any, prior
to the Commencement Date that Tenant may have been given access to the Premises;
(b) any act, omission or negligence of Tenant or any of its subtenants or
licensees or its or their employees or contractors; (c) any accident, injury or
damage whatever (unless caused by Land-lord's negligence or willful misconduct)
occurring in, at or upon the Premises; (d) any breach or default by Tenant in
the full and prompt payment and performance of Tenant's obligations under this
Lease; and (e) the failure of Tenant or any of its subtenants or licensees or
its or their employees or contractors to comply with all Legal Require ments and
Insurance Requirements; together with all costs, expenses and liabilities
incurred in or in connection with each such claim or action or proceeding
brought thereon, including, without limitation, all attorneys' fees and
expenses. In case any action or proceeding is brought against Landlord and/or
any Superior Lessor or Superior Mortgagee and/or its or their partners,
directors, officers, agents and/or employees by reason of any such claim which
is the subject of the foregoing indemnity, Tenant, upon notice from Landlord or
such Superior Lessor or Superior Mortgagee, shall resist and defend such action
or proceeding (by counsel reasonably satisfactory to Landlord). Counsel selected
by Tenant's insurance company shall be deemed satisfactory to Landlord.
20.04. Landlord shall indemnify and hold harmless Tenant and its
officers, directors, agents and employees from and against any and all claims
arising from or in connection with (a) the operation or maintenance of the Land,
the Project and the portions of the Building outside of the Premises, (b)
Landlord's failure to comply with Legal and Insurance Requirements in connection
with the Work or the performance of Landlord's other obligations hereunder, or
(c) the negligence or other wrongful acts of Landlord or its agents, contractors
or employees; together with all costs, expenses and liabilities incurred in or
in connection with each such claim or action or proceeding brought thereon,
including, without limitation, all attorneys' fees and expenses. If any action
or proceeding is brought against Tenant and/or its officers, directors, agents
and/or employees by reason of any such claim, Landlord, upon notice from Tenant,
shall resist and defend such action or proceeding (by counsel reasonably
satisfactory to Tenant).
20.05. The provisions of Sections 20.03 and 20.04 shall survive the
expiration or sooner termination of the Term.
ARTICLE 21 - DAMAGE OR DESTRUCTION
21.01. If the Building or the Premises shall be partially or totally
damaged or destroyed by fire or other casualty (and if this Lease shall not be
terminated as provided in this Article) Landlord
44
shall repair the damage and restore and rebuild the Building and/or the Premises
(except for the Tenant's Property) with reasonable dispatch after notice to it
of the damage or destruction and the collection of the insurance proceeds
attributable to such damage. Landlord shall use diligent efforts to collect such
proceeds in a timely manner.
21.02. Subject to the provisions of Section 21.05, if all or part
-------------
of the Premises is damaged or destroyed or rendered completely or partially
untenantable on account of fire or other casualty, the Fixed Rent and Additional
Charges under Article 4 and Article 5 shall be reduced in the proportion that
--------- ---------
the untenantable area of the Premises bears to the total area of the Premises,
for the period from the date of the damage or destruction to (a) the date the
damage to the Premises is substantially repaired, or (b) if the Building and not
the Premises is so damaged or destroyed, the date on which the Premises is made
tenantable; provided, however, should Tenant reoccupy a portion of the Premises
during the period the repair work is taking place and prior to the date the
Premises are substantially repaired or made tenantable the Fixed Rent and
Additional Charges under Article 4 and Article 5 allocable to such reoccupied
--------- ---------
portion, based upon the proportion which the area of the reoccupied portion of
the Premises bears to the total area of the Premises, shall be payable by Tenant
from the date of such occupancy.
21.03. If either (a) the Premises shall be materially (i.e., 30% or
more) damaged or destroyed by fire or other casualty, or (b) the Building shall
be so damaged or destroyed by fire or other casualty (whether or not the
Premises are damaged or destroyed) that its repair or restoration requires the
expenditure (as estimated by a reputable contractor or architect designated by
Landlord) of more than 50% of the full insurable value of the Building
immediately prior to the casualty and Landlord simultaneously terminates all of
the other leases of space within the Building, then in either such case Landlord
may terminate this Lease by giving Tenant notice to such effect within 90 days
after the date of the fire or other casualty and the Fixed Rent and Additional
Charges shall be prorated and adjusted as of the date of termination. If the
Premises shall be damaged or destroyed by fire or other casualty not caused by
the negligence or wrongful act of Tenant, such that 30% or more of the Premises
is rendered untenantable or reasonable means of access to the Premises is cut
off and (i) Land lord's contractor or architect estimates that the Premises
will not be substantially repaired or restored within 180 days following such
fire or other casualty, or (ii) the Premises are not substantially repaired and
restored within 180 days after the date of the fire or other casualty, or (iii)
because of Landlord's failure to commence such repair and restoration within 90
days after such casualty, such repair and restoration will not be completed
within such 180-day period, then Tenant shall have the right to terminate this
Lease by giving Landlord notice to such effect within 30 days after the date of
such fire or casualty, if pursuant to clause (i), or the end of such 90- or 180-
day period, as the case may be, if pursuant to clause (ii) or (iii), in
45
which event the Fixed Rent and Additional Charges shall be prorated and adjusted
as of the date of termination.
21.04. Except as provided in Section 21.03, Tenant shall not be
-------------
entitled to terminate this Lease and 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 Premises or of the Building
pursuant to this Article. Landlord shall use its best efforts to make such
repair or restoration promptly and in such manner as not unreasonably to
interfere with Tenant's use and occupancy of the Premises, but Landlord shall
not be required to do such repair or restoration work except during Business
Hours on Business Days.
21.05 Notwithstanding any of the foregoing provisions of this
Article, if by reason of some willful or negligent act or omission, or a
violation or breach of this Lease, on the part of Tenant or any of its
subtenants or its or their partners, directors, officers, servants, employees or
agents, Landlord or any Superior Lessor or any Superior Mortgagee shall be
unable to collect insurance proceeds (including, without limitation, rent
insurance proceeds) applicable to damage or destruction of the Premises or the
Building by fire or other casualty, then, without prejudice to any other
remedies which may be available against Tenant, the amount of the reduction of
the Fixed Rent and Additional Charges that would otherwise apply as a result of
such casualty shall be diminished by the amount of such uncollectible proceeds.
21.06. Landlord will not carry insurance of any kind on the Tenant's
Property and shall not be obligated to repair any damage to or replace the
Tenant's Property.
21.07. The provisions of this Article shall be deemed an express
agreement governing any case of damage or destruction of the Premises by fire or
other casualty, and Section 227 of the Real Property Law of the State of New
York, providing for such a contin gency 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.
ARTICLE 22 - EMINENT DOMAIN
22.01. Except as otherwise provided in Section 22.05, if the whole of
-------------
the Building or the Premises shall be taken by condem nation or in any other
manner for any public or quasi-public use or purpose, this Lease shall terminate
as of the date of vesting of title on such taking (herein called the "Date of
the Taking"), and the Fixed Rent and Additional Charges shall be prorated and
adjusted as of such date.
22.02. Except as otherwise provided in Section 22.05, if (a) any
-------------
part of the Building or the Land (but not the Premises) shall be so taken, this
Lease shall be unaffected by such taking, except
46
that if such taking materially adversely affects Landlord's ability to perform
its obligations hereunder, or a material portion of the Building shall be so
taken, then Landlord may, at its option, terminate this Lease by giving Tenant
notice to that effect within 90 days after the Date of the Taking, if Landlord
simultaneously terminates the leases of all other tenants in the Building, and
(b) if 20% or more of the Premises shall be so taken and the remaining area of
the Premises shall not be reasonably sufficient for Tenant to continue feasible
operation of its business, then Tenant may terminate this Lease by giving
Landlord notice to that effect within 90 days after the Date of the Taking. Upon
the giving of such notice, this Lease shall terminate effective as of the date
of the taking, and the Fixed Rent and Additional Charges shall be prorated and
adjusted as of such termination date. Upon such partial taking and this Lease
continuing in force as to any part of the Premises, the Fixed Rent and
Additional Charges shall be adjusted according to the rentable area remaining.
22.03. Except as otherwise provided in Section 22.05, Landlord shall
-------------
be entitled to receive the entire award or payment in connection with any taking
without deduction therefrom for any estate vested in Tenant by this Lease and
Tenant shall receive no part of such award. Tenant hereby expressly assigns to
Landlord all of its right, title and interest in and to every such award or
payment. Nothing herein shall affect Tenant's right to make a separate claim for
its fixtures, improvements and moving expenses, provided such claim does not
affect Landlord's award.
22.04. Except as otherwise provided in Section 22.05, in the event of
-------------
any taking of less than the whole of the Building and/or the Land which does not
result in termination of this Lease, Landlord, at its expense, and whether or
not any award or awards shall be sufficient for the purpose, shall proceed with
reasonable diligence to repair the remaining parts of the Building and the
Premises (other than those parts of the Premises which are the Tenant's
Property) to substantially their former condition to the extent that the same
may be feasible (subject to reasonable changes which Landlord shall deem
desirable) and so as to constitute complete and tenantable the Building and the
Premises.
22.05. If the temporary use or occupancy of all or any part of the
Premises is taken by condemnation or in any other manner for any public or
quasi-public use or purpose, this Lease and the Term shall remain unaffected by
such taking and Tenant shall continue to be responsible for all of its
obligations under this Lease (except to the extent prevented from so doing by
reason of such taking). In such event Tenant shall be entitled to claim, prove
and receive the entire award unless the period of temporary use or occupancy
extends beyond the expiration date of this Lease, in which event Landlord shall
be entitled to claim, prove and receive that portion of the award attributable
to the restoration of the Premises, and the balance of such award shall be
apportioned between Landlord and Tenant as of the expiration date of this Lease.
If such temporary use or occupancy
47
terminates prior to the expiration date of this Lease, Tenant, at its own
expense, shall restore the Premises as nearly as possible to its condition prior
to the taking.
ARTICLE 23 - SURRENDER AND HOLDING OVER
23.01. On the last day of the Term, or upon any earlier termination
of this Lease, or upon any reentry by Landlord upon the Premises, Tenant shall
quit and surrender the Premises to Landlord "broom-clean" and in good order,
condition and repair, except for ordinary wear and tear and such damage or
destruction as Landlord is required to repair or restore under this Lease, and
Tenant shall remove all of the Tenant's Property therefrom except as otherwise
expressly provided in this Lease. No act or thing done by Landlord or its
agents shall be deemed an acceptance of a surrender of the Premises, and no
agreement to accept such surrender shall be valid unless in writing and signed
by Landlord.
23.02. If Tenant remains in possession of the Premises after the
termination of this Lease without the execution of a new lease, Tenant, at the
option of Landlord, shall be deemed to be occupying the Premises as a tenant
from month to month, subject to all of the other terms and conditions of this
Lease insofar as the same are applicable to a month-to-month tenancy, but at a
monthly rental equal to the greater of (a) 125% of the monthly Fixed Rent last
payable by Tenant hereunder, plus all Additional Charges payable hereunder, and
(b) Landlord's then asking price, on a monthly basis, for comparable space in
the Building (or, if Landlord has no asking price, the monthly rental equal to
the prevailing rate for comparable space in comparable buildings in the vicinity
of the Building). Nothing contained in this Section shall (i) imply any right of
Tenant to remain in the Premises after the termination of this Lease without the
execution of a new lease, (ii) imply any obligation of Landlord to grant a new
lease or (iii) be construed to limit any right or remedy that Landlord has
against Tenant as a holdover tenant or trespasser.
23.03. Tenant expressly waives, for itself and for any person
claiming through or under Tenant, any rights which Tenant or any such person may
have under the provisions of Section 2201 of the New York Civil Practice Law and
Rules and of any similar or successor law of same import then in force, in
connection with any holdover proceedings which Landlord may institute to enforce
the terms and conditions of this Lease.
ARTICLE 24 - DEFAULT
24.01. This Lease and the Term are subject to the limitation that
whenever Tenant makes an assignment for the benefit of creditors, or files a
voluntary petition under any bankruptcy or insolvency law, or an involuntary
petition alleging an act of bankruptcy or insolvency is filed against Tenant
under any bankruptcy or insolvency law, or whenever a petition is filed by or
against Tenant under the reorganization provisions of the United States
48
Bankruptcy Act or under the provisions of any law of like import, or whenever a
petition is filed by Tenant under the arrangement provisions of the United
States Bankruptcy Act or under the provisions of any law of like import, or
whenever a permanent receiver of Tenant or such Guarantor, or of or for the
property of Tenant or such Guarantor is appointed, then Landlord (a) if such
event occurs without the acquiescence of Tenant, at any time after the event
continues for 90 days, or (b) in any other case at any time after the occurrence
of any such event, may give Tenant a notice of intention to end the Term at the
expiration of five days from the date of service of such notice of intention,
and upon the expiration of said five-day period this Lease, whether or not the
Term shall theretofore have commenced, shall terminate with the same effect as
if that day were the expiration date of this Lease, but Tenant shall remain
liable for damages as provided in Article 26.
----------
24.02. This Lease is subject to the further limitations that:
(a) if Tenant defaults in the payment of any Fixed Rent or
Additional Charges, and such default continues for five days after notice
thereof given by Landlord to Tenant, or
(b) if Tenant, whether by action or inaction, is in default of
any of its obligations under this Lease (other than a default in the
payment of Fixed Rent or Additional Charges) and such default continues and
is not remedied within 30 days after Landlord gives to Tenant a notice
specifying the same, or, in the case of a default which cannot with due
diligence be cured within a period of 30 days and the continuance of which
for the period required for cure will not (i) subject Landlord or any
Superior Lessor or Superior Mortgagee to prosecution for a crime (as more
particularly described in Section 9.02) or (ii) result in the termination
------------
of any Superior Lease or foreclosure of any Superior Mortgage, if Tenant
does not, (1) within said 30-day period advise Landlord of Tenant's
intention to take all steps necessary to remedy such default, (2) duly
commence within said 30-day period, and thereafter diligently prosecute to
completion all steps necessary to remedy the default and (3) complete such
remedy within a reasonable time after the date of said notice of Landlord,
or
(c) if any event occurs or any contingency arises whereby this
Lease or the estate hereby granted or the unexpired balance of the Term
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 8;
---------
then in any of said cases Landlord may give to Tenant a notice of intention to
end the Term at the expiration of five days from the date of the service of such
notice of intention, and upon the expiration of said five days this Lease,
whether or not the Term theretofore had commenced, shall terminate with the same
effect as if that day were the
49
expiration date of this Lease, but Tenant shall remain liable for damages as
provided in Article 26.
----------
ARTICLE 25 - RE-ENTRY BY LANDLORD
25.01. If Tenant defaults in the payment of any Fixed Rent or
Additional Charges, and such default continues for five days after notice
thereof given by Landlord to Tenant, or if this Lease terminates as provided in
Article 24, Landlord or Landlord's agents and employees may immediately or at
----------
any time thereafter re-enter the Premises, or any part thereof, either by
summary dispossess proceedings or by any suitable action or proceeding at law,
without being liable to indictment, prosecution or damages therefor, and may
repossess the same, and may remove any person therefrom, to the end that
Landlord may have, hold and enjoy the Premises. The word "re-enter," as used
herein, is not restricted to its technical legal meaning. If this Lease is
terminated under the provisions of Article 24, or if Landlord re-enters the
----------
Premises under the provisions of this Article 25, 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 thereupon pay to Landlord the
Fixed Rent and Additional Charges payable up to the time of such termination of
this Lease, or of such recovery of possession of the Premises by Landlord, as
the case may be, and shall also pay to Landlord damages as provided in Article
-------
26.
--
25.02. 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 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.
25.03. If this Lease terminates under the provisions of Article 24, or
----------
if Landlord re-enters the Premises under the provisions of this Article, 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, Landlord shall be entitled to
retain all monies, if any, paid by Tenant to Landlord, whether as advance rent,
security or otherwise, but such monies shall be credited by Landlord against any
Fixed Rent or Additional Charges due from Tenant at the time of such termination
or re-entry or, at Landlord's option, against any damages payable by Tenant
under Article 26 or pursuant to law.
----------
ARTICLE 26 - DAMAGES
26.01 If this Lease is terminated under the provisions of Article 24,
----------
or if Landlord re-enters the Premises under the provisions of Article 25, or in
----------
the event of the termination of this Lease, or of re-entry, by or under any
summary dispossess or other proceeding or
50
action or any provision of law by reason of default hereunder on the part of
Tenant, Tenant shall pay to Landlord as damages, 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,
represents the then present value (discounted at the then Prime Rate) of
the excess, if any, of (i) the aggregate amount of the Fixed Rent and the
Additional Charges under Article 4 and Article 5 which would have been
--------- ---------
payable by Tenant (conclusively presuming the average monthly Additional
Charges under Article 4 and Article 5 to be the same as were payable for
--------- ---------
the year, or if less than 365 days have then elapsed since the Rent
Commencement Date, the partial year, immediately preceding such termination
or re-entry) 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 date contemplated as the expiration date hereof if this Lease had
not so terminated or if Landlord had not so re-entered the Premises, over
(ii) the aggregate rental value of the Premises for the same period, or
(b) sums equal to the Fixed Rent and the Additional Charges which
would have been payable by Tenant had this Lease not so terminated, or had
Landlord not so re-entered the Premises, payable upon the due dates
therefor specified herein following such termination or such re-entry and
until the date contemplated as the expiration date hereof if this Lease had
not so terminated or if Landlord had not so re-entered the Premises,
provided, however, that if Landlord shall relet the Premises during said
period, landlord shall credit Tenant with the net rents received by
Landlord from such reletting, such net rents to be determined by first
deducting from the gross rents as and when received by Landlord from such
reletting the expenses incurred or paid by Landlord in terminating this
Lease or in re-entering the Premises and in securing possession thereof, as
well as the expenses of reletting, including, without limitation, altering
and preparing the Premises for new tenants, brokers' commissions, legal
fees, and all other expenses properly chargeable against the Premises and
the rental therefrom, it being understood that any such reletting may be
for a period shorter or longer than what would have been the remaining
Term, but in no event shall Tenant be entitled to receive any excess of
such net rents over the sums payable by Tenant to Landlord hereunder, nor
shall Tenant be entitled in any suit for the collection of damages pursuant
to this subdivision to a credit in respect of any net rents from a
reletting, except to the extent that such net rents are actually received
by Landlord. If the Premises or any part thereof should be relet in
combination with other space, then proper apportionment on a square foot
basis shall be made of the rent received from such reletting and of the
expenses of reletting.
51
If the Premises or any part thereof is or are relet by Landlord for what would
have been the unexpired portion of the Term, or any part thereof, before
presentation of proof of such damages to any court, commission or tribunal, the
amount of rent reserved upon such reletting shall, prima facie, be the fair and
----- -----
reasonable rental value for the Premises, or part thereof, so relet during the
term of the reletting. Landlord shall not be liable in any way whatsoever for
its failure to relet the Premises or any part thereof, or if the Premises or any
part thereof are relet, for its failure to collect the rent under such
reletting, and no such failure to relet or failure to collect rent shall release
or affect Tenant's liability for damages or otherwise under this Lease, unless
Landlord shall be found to have acted in bad faith in connection therewith.
26.02. 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 24, or under any provisions of
----------
law, or had Landlord not re-entered the 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 damages by reason of
the termination of this Lease or re-entry on the 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 than, equal
to, or less than any of the sums referred to in Section 26.01.
-------------
26.03. In addition, if this Lease is terminated under the
provisions of Article 24, or if Landlord re-enters the Premises under the
----------
provisions of Article 25, Tenant agrees that the Premises then shall be in the
----------
same condition as that in which Tenant has agreed to surrender the same to
Landlord at the expiration of the Term.
ARTICLE 27 - AFFIRMATIVE WAIVERS
27.01. Tenant, on behalf of itself and any and all persons claiming
through or under Tenant, does hereby waive and surrender all right and privilege
which it, they or any of them might have under or by reason of any present or
future law, to redeem the Premises or to have a continuance of this Lease after
being dispossessed or ejected therefrom by process of law or under the terms of
this Lease or after the termination of this Lease as provided in this Lease.
27.02. If Tenant is in arrears in payment of Fixed Rent or Additional
Charges, Tenant waives Tenant's right, if any, to designate the items to which
any payments made by Tenant are to be credited, and Landlord may apply any
payments made by Tenant to such items as
52
Landlord sees fit, irrespective of and notwithstanding any designation or
request by Tenant as to the items to which any such payments shall be credited.
27.03. Landlord and Tenant hereby waive trial by jury in any action,
proceeding or counterclaim brought by either against the other on any matter
whatsoever arising out of or in any way connected with this Lease, the
relationship of Landlord and Tenant, Tenant's use or occupancy of the Premises,
including, without limitation, any claim of injury or damage, and any emergency
and other statutory remedy with respect thereto.
27.04. Tenant shall not interpose any counterclaim of any kind in any
summary proceeding commenced by Landlord to recover possession of the Premises
and shall not seek to consolidate such proceeding with any action which may have
been or will be brought by Tenant or any other person.
ARTICLE 28 - NO WAIVERS
28.01. The failure of either party to insist in any one or more
instances upon the strict performance of any one or more of the obligations of
this Lease, or to exercise any election herein contained, shall not be construed
as a waiver or relinquishment for the future of the performance of such one or
more obligations of this Lease or of the right to exercise such election, but
the same shall continue and remain in full force and effect with respect to any
subsequent breach, act or omission. The receipt by Landlord of Fixed Rent or
Additional Charges with knowledge of breach by Tenant of any obligation of this
Lease shall not be deemed a waiver of such breach.
ARTICLE 29 - CURING TENANT'S DEFAULTS
29.01. If Tenant defaults in the performance of any of Tenant's
obligations under this Lease, Landlord, without thereby waiving such default,
may (but shall not be obligated to) perform the same for the account and at the
expense of Tenant, without notice in a case of emergency, and in any other case
only if such default continues after the expiration of 15 days from the date
Landlord gives Tenant notice of the default.
29.02. Bills for any expenses incurred by Landlord in connection with
any such performance by it pursuant to Section 29.01 for the account of Tenant,
and bills for all costs, expenses and disbursements, including reasonable
counsel fees, involved in collecting or endeavoring to collect the Fixed Rent or
Additional Charges or enforcing or endeavoring to enforce any rights against
Tenant or Tenant's obligations hereunder in connection with a default, including
any cost, expense and disbursement involved in instituting and prosecuting
summary proceedings or in recovering possession of the Premises after default by
Tenant or upon the expiration or sooner termination of this Lease, and interest
on all sums advanced by Landlord under this Section and/or Section 29.01 at the
-------------
Lease Interest
53
Rate may be sent by Landlord to Tenant monthly, and such amounts shall be due
and payable in accordance with the terms of such bills.
ARTICLE 30 - BROKER
30.01. Each party represents that no broker except Xxxxxxx &
Xxxxxxxxx, Inc. and Delphi Commercial Properties, Inc. (herein called the
"Brokers") was instrumental in bringing about or consummating this Lease and
that such party had no conversations or negotiations with any broker except the
Brokers concerning the leasing of the Premises. Each party shall indemnify and
hold harmless the other against and from any claims for any brokerage
commissions and all costs, expenses and liabilities in connection therewith,
including, without limitation, attorneys' fees and expenses, arising out of any
conversations or negotiations had by the indemnifying party with any broker
other than the Brokers. Landlord shall pay any brokerage commissions due the
Brokers as per separate agreements between Landlord and the Brokers.
ARTICLE 31 - NOTICES
31.01. Any notice, consent, approval or other communication
required or permitted to be given, rendered or made by either party to the other
shall be in writing (whether or not so stated elsewhere in this Lease) and shall
be deemed to have been properly given, rendered or made only if either (a) sent
by registered or certified mail, return receipt requested, posted in a United
States post office station or letter box in the continental United States, or
(b) hand delivered, in either event addressed to the other party at the address
hereinabove set forth (except that after the Rent Commencement Date, Tenant's
address, unless Tenant shall give notice to the contrary, shall be the
Premises), and shall be deemed to have been given, rendered or made either (i)
on the first day after the day so mailed, unless mailed outside of the State of
New York, in which case it shall be deemed to have been given, rendered or made
on the third business day after the day so mailed, or (ii) on the day received
if so hand delivered. Either party may, by notice as aforesaid, designate a
different address or addresses for notices, statements, demands, consents,
approvals or other communications intended for it. A duplicate original of any
notice given to Landlord shall be simultaneously and similarly sent by Tenant to
the attention of Executive Vice President, Keren Developments, Inc., 000 Xxx Xxx
Xxxx Xxxxx Xxxx, Xxxxxxxxx, Xxx Xxxx 00000-0000.
ARTICLE 32 - ESTOPPEL CERTIFICATES
32.01. Each party shall, at any time and from time to time, if
requested by the other party with not less than 10 days' prior notice, execute
and deliver to the other a statement certifying that this Lease is unmodified
and in full force and effect (or if there have been modifications, that the same
is in full force and effect as modified and stating the modifications),
certifying the dates to which the Fixed Rent and Additional Charges have been
paid, stating whether
54
or not, to the best knowledge of the signer, the other party is in default in
performance of any of its obligations under this Lease, and, if so, specifying
each such default of which the signer shall have knowledge, and stating whether
or not, to the best knowledge of the signer, any event has occurred which with
the giving of notice or passage of time, or both, would constitute such a
default, and, if so, specifying each such event, it being intended that any such
statement delivered pursuant hereto shall be deemed a representation and
warranty to be relied upon by the party requesting the certificate and by others
with whom such party may be dealing, regardless of independent investigation.
Tenant also shall include in any such statement such other information
concerning this Lease as Landlord may reasonably request.
ARTICLE 33 - EXECUTION AND DELIVERY OF LEASE
33.01. Submission by Landlord of the within Lease for review and
execution by Tenant shall confer no rights nor impose any obligations on either
party unless and until both Landlord and Tenant shall have executed this Lease
and duplicate originals thereof shall have been delivered to the respective
parties.
ARTICLE 34 - RECORDING OF LEASE
34.01. At the request of Landlord, Tenant shall promptly execute,
acknowledge and deliver to Landlord a memorandum in respect of this Lease and/or
any amendment or modification of this Lease sufficient for recording, setting
forth only the matters required to be set forth pursuant to Section 291-c of the
New York Real Property Law. Such memorandum shall not in any circumstance be
deemed to change or otherwise affect any of the terms of this Lease. Tenant
shall not record this Lease or said memorandum or any other document related
hereto.
ARTICLE 35 - PARKING
35.01. Landlord shall, without charge to Tenant (except as
consequence of the cost thereof being included in Operating Expenses), provide
and maintain, for the non-exclusive use of Tenant's employees and invitees,
parking areas sufficient to accommodate at least 200 standard size automobiles
in the area(s) shown as "parking" on the plan attached hereto as Exhibit D. In
---------
the event Landlord utilizes such parking areas for Landlord's development
purposes, Landlord will provide Tenant with substantially equivalent number and
location of parking facilities.
ARTICLE 36 - ENVIRONMENTAL COMPLIANCE
36.01. Subject to Section 36.02, Tenant assumes sole and full
-------------
responsibility for compliance with all applicable Federal, state and local
environmental statutes, regulations and ordinances (including licensing and
permitting) (herein called the "Environmental Laws") in respect of Tenant's use
of the Premises and agrees to
55
indemnify, defend, save and hold harmless Landlord and all Superior Lessors and
Superior Mortgagees, and its and their respective partners, directors, officers,
agents and employees from and against any and all claims, demands, losses and
liability (including reasonable attorneys' fees) resulting from any alleged or
actual violation thereof by Tenant or any of its subtenants or licensees or its
or their employees or contractors. Tenant assumes sole and full responsibility
to Landlord for all present and future acts or omissions of Tenant or any of its
subtenants or licensees or its or their employees or contractors while at or on
the Project and covenants and agrees to indemnify, defend, save and hold
harmless Landlord and all Superior Lessors and Superior Mortgagees, and its and
their respective partners, directors, officers, agents and employees, from and
against any and all claims, demands, losses, and liability (including reasonable
attorneys' fees) resulting from any alleged or actual violation thereof,
including, but not limited to, personal injury (and death resulting therefrom),
property damage, damage to natural resources, and strict liability under
Environmental Laws. The provisions of this Section 36.01 shall survive the
-------------
expiration or termination of this Lease.
36.02. Landlord represents and warrants to Tenant that, to Landlord's
actual knowledge, there is no asbestos in the Premises or the public areas of
the Building, except for the possible presence of asbestos on certain pipes,
which is either encapsulated or is not in friable condition. If it is hereafter
determined that asbestos which is present in the Premises on the Commencement
Date is friable and not encapsulated, or if any such asbestos that is
encapsulated will be disturbed by Alterations to be made by Tenant in accordance
with Article 12, then, provided Tenant is not in default hereunder beyond
----------
applicable notice and grace and the need for removal or encapsulation of such
asbestos does not arise as a result of the negligent or wrongful acts or
omissions of Tenant or its agent, subtenant, employee, contractor or invitee,
Landlord shall promptly at its expense, remove or (provided Tenant's permitted
Alterations will not be materially adversely affected thereby) encapsulate such
asbestos in accordance with applicable Legal Requirements. Landlord shall
perform such work in a manner as to have the least practicable interference with
Tenant's use and operations in the Premises, recognizing Tenant's sensitive
laboratory work.
ARTICLE 37 - SIGNS
37.01. Tenant may not place signs anywhere in the Project,
including on the exterior of the Building, without the prior written consent of
Landlord. Landlord hereby consents to the placement by Tenant of appropriate
sign(s), approved by Landlord and Tenant, near the front door of the Premises
and in the elevator lobby of the Building. Landlord shall add Tenant's name to
the Building directory and to the existing tenant directional signs in the
roadway and parking lot appurtenant to the Building.
56
ARTICLE 38 - APPROVAL CONTINGENCY
38.01. This Lease shall not be effective until and unless Swiss
Bank and Carbide shall have executed and delivered a written consent to this
Lease and each shall have executed and delivered to Tenant a non-disturbance
agreement with respect to this Lease (a "SNDA"), substantially in the form of
Exhibit I hereto or in form otherwise reasonably acceptable to Tenant. If Swiss
---------
Bank or Carbide disapproves this Lease, or refuses to execute and deliver such
SNDA, then this Lease shall be deemed null and void and of no effect.
Notwithstanding any provision to the contrary, if Tenant occupies the Premises
or causes any work to be performed thereon prior to receipt of Swiss Bank's or
Carbide's approval or disapproval, then as between Tenant and Landlord the
provisions of this Lease shall be applicable and enforceable. If either Swiss
Bank or Carbide does not give its approval or disapproval, or does not execute
and deliver such SNDA, within 15 days after the date hereof, either party may
give notice of cancellation of this Lease to the other after said 15-day period
but prior to the giving of said approval and the execution and delivery of such
SNDA, and if either party gives such cancellation notice timely, this Lease
shall be deemed null and void and of no effect.
ARTICLE 39 - UNTENANTABILITY
39.01. Subject to Section 6.02, if, as a result of Landlord's
------------
negligence or willful act, Landlord shall fail to provide services, electric
energy, heat, ventilation or air-conditioning to the Premises as required
hereunder (other than in the case of a casualty, which shall be governed by
Article 21), and, as a consequence thereof, the Premises are rendered
----------
untenantable, and Tenant does not use or conduct business in the Premises, for a
period of 10 consecutive days after notice of such untenantability is given by
Tenant to Landlord, then Tenant shall be entitled to an abatement of Fixed Rent
equal to 1/365 of the annual Fixed Rent for the Premises at the time in question
multiplied by the number of such consecutive days, which abatement shall be
credited against the installment of Fixed Rent next becoming due thereafter.
Tenant shall notify Landlord (and all Superior Mortgagees and Superior Lessors)
of any such failure promptly after obtaining knowledge thereof.
ARTICLE 40 - PARTNERSHIP OR MULTI-PERSON TENANT
40.01. If Tenant's interest in this Lease is assigned to a general
partnership (or to two or more persons individually), the following provisions
shall apply: (a) the liability of each of the persons at any time comprising
Tenant shall be joint and several, (b) each of the persons at any time
comprising Tenant shall be bound by (i) any written instrument executed by
Tenant or any successor Tenant changing, modifying, extending or discharging
this Lease, in whole or in part, or surrendering all or any part of the Premises
to Landlord, (ii) any Notices given by Tenant or by any of the persons
comprising Tenant, and (iii) any statement executed by Tenant or any of the
persons comprising Tenant, pursuant to Section 32.01, (c) any
-------------
57
notices given to Tenant or to any of such persons shall be binding on Tenant and
all such persons, (d) if Tenant admits new partners, all of such new partners
shall, by their admission to Tenant, be deemed to have assumed joint and several
liability for the performance of all of Tenant's obligations under this Lease,
(e) Tenant shall give prompt notice to Landlord of the admission of any such new
partners, and on demand of Landlord shall cause each such new partner to execute
and deliver to Landlord an agreement in form satisfactory to Landlord wherein
each such new partner assumes joint and several liability for the performance of
all of Tenant's obligations under this Lease (but neither Landlord's failure to
request any such agreement nor the failure of any such new partner to execute or
deliver any such agreement to Landlord shall vitiate the provisions of clause
------
(d) of this Section), and (f) the death, adjudication of incompetency or
---
withdrawal of an individual comprising Tenant or of an individual partner shall
not relieve him or his personal representatives of any liability for the
performance of Tenant's obligations under this Lease.
ARTICLE 41 - MISCELLANEOUS
41.01. Tenant expressly acknowledges and agrees that Landlord has not
made and is not making, and Tenant, in executing and delivering this Lease, is
not relying upon, any warranties, representations, promises or statements,
except to the extent that the same are expressly set forth in this Lease or in
any other written agreement which may be made between the parties concurrently
with the execution and delivery of this Lease and which expressly refer to this
Lease. All understandings and agreements heretofore had between the parties are
merged in this Lease and any other written agreements made concurrently
herewith, which alone fully and completely express the agreement of the parties
and which are entered into after full investigation, neither party relying upon
any statement or representation not embodied in this Lease or any other written
agreements made concurrently herewith.
41.02. No agreement shall be effective to change, modify, waive,
release, discharge, terminate or effect an abandonment of this Lease, in whole
or in part, unless such agreement is in writing, refers expressly to this Lease
and is signed by the party against whom enforcement of the change, modification,
waiver, release, discharge, termination or effectuation of the abandonment is
sought. If Tenant shall at any time request Landlord to relet the Premises for
Tenant's account, Landlord or its agent is authorized to receive keys for such
purpose without releasing Tenant from any of its obligations under this Lease,
and Tenant hereby releases Landlord of any liability for loss or damage to any
of the Tenant's Property in connection with such reletting.
41.03. Except as otherwise expressly provided in this Lease, the
obligations of this Lease shall bind and benefit the successors and assigns of
the parties hereto with the same effect as if mentioned in each instance where a
party is named or referred to;
58
provided, however, that (a) no violation of the provisions of Article 8 shall
---------
operate to vest any rights in any successor or assignee of Tenant and (b) the
provisions of this Article shall not be construed as modifying the conditions of
limitation contained in Article 24. No provision in this Lease shall be
----------
construed for the benefit of any third party except as expressly provided
herein.
41.04. The obligations of Tenant hereunder shall not be affected,
impaired or excused, nor shall Landlord have any liability to Tenant, because
(a) Landlord is unable to fulfill, or is delayed in fulfilling, any of its
obligations under this Lease by reason of strike, other labor trouble,
governmental preemption of priorities or other controls in connection with a
national or other public emergency, or shortage of fuel, supplies or labor, or
any other cause, whether similar or dissimilar, beyond Landlord's reasonable
control; or (b) of any failure or defect in the supply, quantity or character of
electricity, steam, oil, gas or water furnished to the Premises, by reason of
any requirement, act or omission of the public utility serving the Building with
electric energy, steam, oil, gas or water, or for any other reason whether
similar or dissimilar, beyond Landlord's reasonable control. For purposes
hereof, lack of funds on the part of Landlord or any negligence or wrongful act
of Landlord or any of its employees, agents or contractors shall not be deemed a
cause beyond Landlord's reasonable control.
41.05. All references in this Lease to the consent or approval of
Landlord shall be deemed to mean only the written consent or approval of
Landlord and no consent or approval of Landlord shall be effective for any
purpose unless such consent or approval is set forth in a written instrument
executed by Landlord. If Tenant requests Landlord's consent and Landlord fails
or refuses to give such consent, then, unless Landlord shall be determined to
have acted in bad faith, Tenant shall not be entitled to any damages for any
withholding by Landlord of its consent, it being intended that Tenant's sole
remedy shall be an action for specific performance or injunction, plus court
costs and reasonable legal fees if Tenant is the prevailing party, and that such
remedy shall be available only in those cases where this Lease provides that
Landlord may not unreasonably withhold its consent or where as a matter of law
Landlord may not unreasonably withhold its consent. Wherever this Lease
provides for Landlord's consent not to be unreasonably withheld, such consent
shall also not be unreasonably delayed.
41.06 If an excavation is made upon land adjacent to or under the
Building, or is authorized to be made, Tenant shall afford to the person causing
or authorized to cause such excavation, license to enter the Premises for the
purpose of performing such work as said person shall deem necessary or desirable
to preserve and protect the Building from injury or damage and to support the
same by proper foundations, without any claim for damages or liability against
Landlord and without reducing or otherwise affecting Tenant's obligations under
this Lease.
59
41.07. Tenant agrees that the exercise of its rights pursuant to the
provisions of Article 12 or of any other provisions of this Lease or the
----------
Exhibits hereto shall not be done in a manner which would violate Landlord's
union contracts affecting the Project, nor create any work stoppage, picketing,
labor disruption or dispute or any interference with the business of Landlord or
any tenant or occupant of the Project.
41.08. 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. If any provision of this Lease or the application thereof to
any person or circumstances shall, for any reason and to any extent, be invalid
or unenforceable, the remainder of this Lease and the application of that
provision to other persons or circumstances shall not be affected but rather
shall be enforced to the extent permitted by law. The table of contents,
captions, headings and titles in this Lease are solely for convenience of
reference and shall not affect its interpretation. This Lease shall be construed
without regard to any presumption or other rule requiring construction against
the party causing this Lease to be drafted. 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. 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.
ARTICLE 42 - OPTIONS
42.01. Tenant shall have the right, at its option (herein called the
"First Extension Option"), to extend the term of this Lease for an additional
term of five years (herein called the "First Extension Term") commencing on the
date (herein called the "First Extension Commencement Date") immediately
following the date that would otherwise have been the Expiration Date (herein
called the "Original Expiration Date") and expiring on the fifth anniversary of
the Original Expiration Date. The First Extension Option may only be exercised
by Tenant's written notice (herein called the "First Exten sion Notice") given
to Landlord before the end of the ninth Lease Year, time being of the essence
with respect to the giving of the First Extension Notice, and only if Tenant is
not in default in the payment of Fixed Rent or any Additional Charges under this
Lease and is not in default beyond the applicable notice or cure period in the
performance of any other material terms, covenants or conditions of this Lease,
both as of the date of the giving of the First Extension Notice and the First
Extension Commencement Date. All of the provisions of this Lease shall apply to
the First Extension Term, except that (i) the Fixed Rent payable by Tenant to
Landlord during the First Extension Term shall be at an annual rate equal to 95%
of the Fair Market Rental for the Premises, determined in accordance with
Section 42.04 and (ii) Section 3.03 shall not be applicable.
------------- ------------
60
42.02. If Tenant effectively exercises the First Extension Option, then
Tenant shall have the right, at its option (herein called the "Second Extension
Option"), to extend the term of this Lease for an additional term of five years
(herein called the "Second Extension Term") commencing on the date (herein
called the "Second Extension Commencement Date") immediately following the last
day of the First Extension Term (herein called the "Extended Expiration Date")
and expiring on the fifth anniversary of the Extended Expiration Date. The
Second Extension Option may only be exercised by Tenant's written notice (herein
called the "Second Extension Notice") given to Landlord on or before the fourth
anniversary of the First Extension Commencement Date, time being of the essence
with respect to the giving of the Second Extension Notice, and only if Tenant is
not in default in the payment of Fixed Rent or any Additional Charges under this
Lease and is not in default beyond the applicable notice or cure period in the
performance of any other material terms, covenants or conditions of this Lease,
both as of the date of the giving of the Second Extension Notice and the Second
Extension Commencement Date. All of the provisions of this Lease shall apply to
the Second Extension Term, except that (i) the Fixed Rent payable by Tenant to
Landlord during the Second Extension Term shall be at an annual rate equal to
95% of the Fair Market Rental for the Premises, determined in accordance with
Section 42.04, (ii) Section 3.03 shall not be applicable, and (iii) Tenant shall
------------- ------------
have no option to extend the term of this Lease beyond the fifth anniversary of
the Extended Expiration Date.
42.03. (a) If at any time prior to the expiration or termination of
the original Term of this Lease (i.e., excluding the Extension Terms), Landlord
desires to lease all or a portion (in either case, herein called the "Offered
Space") of the space (herein called the "First Offer Space") described in
Exhibit J hereto, other than as permitted pursuant to clause (ii) of Section
--------- -------
42.03(d), then Landlord shall first offer to lease the Offered Space to Tenant
--------
(herein called the "First Offer") by sending a written notice to Tenant (herein
called the "Offered Space Notice") which shall (i) identify the Offered Space
and the date on which such Offered Space is expected to be ready for occupancy
(the "Availability Date"), and (ii) state that Landlord is in active discussions
with a bona fide prospective tenant for such Offered Space and Landlord and such
prospective tenant have tentatively agreed upon a rental rate for such Offered
Space. Tenant must notify the Landlord in writing, within 30 days after the
Offered Space Notice is given, stating whether Tenant accepts or rejects the
First Offer (herein called the "Election Notice"), time being of the essence
with respect to the giving of the Election Notice. If Tenant fails to give an
Election Notice within such 30-day period, then Tenant will be deemed to have
rejected the First Offer. If Tenant rejects or is deemed to reject such First
Offer, then Landlord shall have no further obligation to again offer any of such
Offered Space to Tenant and such Offered Space shall no longer be considered to
be First Offer Space for purposes hereof; unless Landlord shall fail to enter
into a lease for such Offered Space within 180 days after such rejection (or
deemed rejection), in
61
which event such Offered Space shall again be considered to be First Offer Space
for purposes hereof.
(b) If Tenant accepts, by means of the Election Notice, the First
Offer contained in the Offered Space Notice within the required 30-day period,
then (i) on the Offered Space Commencement Date (as hereinafter defined), (A)
Landlord shall deliver possession of the Offered Space to Tenant, (B) Landlord
shall pay to Tenant (or, at Landlord's option, shall pay into an escrow for
disbursement to Tenant under arrangements similar to the escrow arrangements set
forth in Section 3.03(b)) the Offered Space Work Contribution (as hereinafter
---------------
defined) and (C) Tenant shall accept the Offered Space "as is" on the date of
the giving of the Offered Space Notice, except for reasonable wear and tear,
(ii) Landlord shall use reasonable efforts to cause the Offered Space
Commencement Date to occur not later than the Availability Date, (iii) from and
after the Offered Space Commencement Date, the Offered Space shall be part of
the Premises for all purposes of this Lease, (iv) from and after the Offered
Space Rent Commencement Date (as hereinafter defined), (A) the Fixed Rent shall
be increased by an amount per annum equal to the product of the number of
rentable square feet in the Offered Space and the Offered Space Rent Factor (as
hereinafter defined), and (B) Tenant's Proportionate Share shall be increased
proportionately, based on the percentage by which the area of the Premises shall
have been enlarged by the inclusion of the Offered Space therein. The "Offered
Space Commencement Date" for any Offered Space shall mean the later of the
Availability Date or the date on which possession of the Offered Space is first
delivered to Tenant. The "Offered Space Work Contribution" for any Offered
Space shall be equal to the product of (I) $35.25, (II) the number of rentable
square feet in such Offered Space, and (III) a fraction, the numerator of which
shall be the number of months from the Offered Space Rent Commencement Date to
the tenth anniversary of the Rent Commencement Date and the denominator of which
is 120. The "Offered Space Rent Factor" shall be equal to the annual Fixed Rent
per rentable square foot set forth on Exhibit B. The "Offered Space Rent
---------
Commencement Date" for any Offered Space shall mean the earlier of (x) the 183rd
day after the Offered Space Commencement Date or (y) the date on which Tenant
takes occupancy of any part of such Offered Space for the regular conduct of its
business therein. The work that Tenant performs in the Offered Space to prepare
the Offered Space for its initial occupancy is referred to herein as the
"Offered Space Work".
(c) The addition of the Offered Space shall be reflected by an
amendment to this Lease to include the Offered Space as part of the Premises
(but neither Landlord's failure to submit nor Tenant's or Landlord's failure to
execute and deliver such an amendment shall affect the effectiveness of such
inclusion).
(d) So long as Tenant is not in default hereunder beyond applicable
notice and grace, and Tenant and its affiliates are in actual occupancy of at
least 15,000 square feet of the Premises, Landlord shall not enter into a lease
covering any of the First Offer
62
Space, prior to the First Extension Term, with anyone other than (i) Tenant or
(ii) a tenant listed on Exhibit F hereto pursuant to an expansion right or
---------
option, or right of first offer, contained in such tenant's lease of space in
the Project.
(e) If the First Offer contained in an Offered Space Notice pertains
to First Offer Space on the same floor as the original Premises as well as to
other First Offer Space, then Tenant shall have the right to accept such First
Offer either for all of the First Offer Space covered therein or only for the
portion of such First Offer Space on the same floor as the original Premises;
and the "Offered Space", for purposes of paragraphs (b) and (c) of this Section
42.03 shall be whichever of such two alternatives Tenant specifies in the
Election Notice (if Tenant elects to accept such First Offer).
42.04. The Fair Market Rental for the Premises shall, for purposes of
Section 42.01 or 42.02, be determined as follows, as of the date (herein called
------- ----- -----
the "Determination Date") of the giving of the First Extension Notice (in the
case of Section 42.01) or the Second Extension Notice (in the case of Section
------------- -------
42.02):
-----
(a) Landlord shall notify Tenant of Landlord's determination of
the relevant Fair Market Rental (herein called "Landlord's Determination")
within 60 days after the Determination Date.
(b) If Tenant disputes Landlord's Determination of Fair Market
Rental, then at any time on or before the date occurring 30 days after
Tenant has been notified by Landlord of Landlord's Determination, Tenant
may initiate the arbitration process provided for herein by giving notice
to that effect to Landlord, and if Tenant so initiates the arbitration
process, such notice shall specify the name and address of the person
designated to act as an arbitrator on its behalf. If Tenant fails to
initiate the arbitration process within such 30-day period, time being of
the essence, then Landlord's Determination shall be conclusive. Within 30
days after Landlord's receipt of notice of the designation of Tenant's
arbitrator, Landlord shall give notice to Tenant specifying the name and
address of the person designated to act as an arbitrator on its behalf. If
Landlord fails to notify Tenant of the appointment of its arbitrator within
the time above specified, then the appointment of the second arbitrator
shall be made in the same manner as hereinafter provided for the
appointment of a third arbitrator in a case where the two arbitrators
appointed hereunder and the parties are unable to agree upon such
appointment. The two arbitrators so chosen shall meet within 10 days after
the second arbitrator is appointed, and if within 30 days after the second
arbitrator is appointed the two arbitrators shall not agree upon a
determination of the Fair Market Rental in dispute, they shall together
appoint a third arbitrator. If the two arbitrators are unable to agree
upon the third arbitrator within 45 days after the appointment of the
second arbitrator, the third arbitrator
63
shall be selected by the parties themselves if they can agree thereon
within a further period of 15 days. If the parties do not so agree, then
either party, on behalf of both and on notice to the other, may request
such appointment by the American Arbitration Association (or any
organization successor thereto) in accordance with its rules then
prevailing or if the American Arbitration Association (or such successor
organization) shall fail to appoint the third arbitrator within 15 days
after such request is made, then either party may apply, on notice to the
other, to the Supreme Court, Westchester County (or any other Court having
jurisdiction and exercising functions similar to those now exercised by
such Court) for the appointment of the third arbitrator. The third
arbitrator shall determine which of the two respective Fair Market Rentals
determined by the first arbitrator and the second arbitrator is closer to
the actual Fair Market Rental of the Premises or the Offered Space (as the
case may be) and render a written report of his or her determination to
both Landlord and Tenant within 60 days from the appointment of the third
arbitrator, and the Fair Market Rental as determined by the first
arbitrator or the second arbitrator which, in the judgment of the third
arbitrator, is closer to the actual Fair Market Rental, shall be applied to
determine the Fixed Rent for the Premises for the relevant Extension Term
or for the Offered Space, as the case may be.
(c) In determining the Fair Market Rental, the arbitrators shall
take into account all relevant factors including those provisions of this
Lease which will be in effect during the applicable period.
(d) Landlord and Tenant shall pay the fees and expenses of the
arbitrator appointed by or for it, and the fees and expenses of the third
arbitrator, and all other expenses (not including the attorneys' 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 by
Landlord and Tenant equally.
(e) Each of the arbitrators shall have at least ten years'
current experience in determining fair market rental of office space in
Westchester County office buildings.
(f) If Tenant initiates the aforesaid arbitration process and as
of the first day of the relevant Extension Term or Offered Space
Commencement Date, as the case may be, the amount of the Fair Market Rental
has not been determined, Tenant shall pay the disputed Fixed Rent at a
monthly rate equal to the rate derived from Landlord's Determination, and
when the arbitrator's determination has actually been made, an appropriate
retroactive adjustment shall be made.
42.05. The termination or cancellation of this Lease during (or prior
to) the initial Term hereof shall also terminate and render
64
void any option or right on Tenant's part to extend the Term of this Lease
pursuant to Section 42.01 or 42.02, or to expand the Premises pursuant to
------------- -----
Section 42.03, whether or not such option or right shall have previously been
-------------
exercised.
IN WITNESS WHEREOF, Landlord and Tenant have duly executed this Lease
as of the day and year first above written.
LANDLORD:
KEREN LIMITED PARTNERSHIP
By: Keren Management Limited
Partnership, General Partner
By: Keren Developments Inc.
By:_____________________
Name: Xxxxx X. Xxx
Title: President
TENANT:
EMISHPERE TECHNOLOGIES, INC.
By:_______________________________
Name:
Title:
Tenant's Federal Identification
Number
_______________________________
65
STATE OF NEW YORK )
: ss.:
COUNTY OF WESTCHESTER )
On the ____ day of __________, 1997, before me personally came Xxxxx
X. Xxx to me known, who, being by me duly sworn, did depose and say that he
resides at _________________________________________; that he is the President
of Keren Developments Inc. which corporation is the general partner of Keren
Management Limited Partnership, which limited partnership is the general partner
of KEREN LIMITED PARTNERSHIP, the partnership described in and which executed
the foregoing instrument; and that he signed his name thereto by order of the
board of directors of said corporation (Keren Developments Inc.) as general
partner of Keren Management Limited Partnership, as general partner of Keren
Limited Partnership.
__________________________
Notary Public
STATE OF NEW YORK )
: ss.:
COUNTY OF )
On the ____ day of __________, 1997, before me personally came
__________________________, to me known, who, being by me duly sworn, did depose
and say that he resides at _____________________,
_____________________________________; that he is the ______________ of
EMISPHERE TECHNOLOGIES, INC., the corporation described in and which executed
the foregoing instrument; and that he signed his name thereto by order of the
board of directors of said corporation.
__________________________
Notary Public
PLAN OF PREMISES
----------------
EXHIBIT A
---------
SCHEDULE OF FIXED RENT
----------------------
FIXED RENT PER
RENTABLE SQUARE FIXED RENT
LEASE YEAR FOOT PER ANNUM PER ANNUM
------------ --------------- ----------
1 - 5 $19 $1,266,540
6 - 10 $20 $1,333,200
EXHIBIT B
---------
RULES AND REGULATIONS
---------------------
1. The rights of each tenant in the entrances, corridors and
elevators servicing the Building are limited to ingress to and egress from such
tenant's premises for the tenant and its employees, licensees and invitees, and
no tenant shall use, or permit the use of, the entrances, corridors or elevators
for any other purpose. No tenant shall invite to the tenant's premises, or
permit the visit of, persons in such numbers or under such conditions as to
interfere with the use and enjoyment of any of the plazas, entrances, corridor,
elevators and other facilities of the Building by any other tenants. Fire exits
and stairways are for emergency use only, and they shall not be used for any
other purpose by the tenants, their employees, licensees or invitees. No tenant
shall encumber or obstruct, or permit the encumbrance or obstruction of any of
the sidewalks, plazas, entrances, corridors, elevators, fire exits or stairways
of the Building. Landlord reserves the right to control and operate the public
portions of the Building and the public facilities, as well as facilities
furnished for the common use of the tenants, in such manner as it in its
reasonable judgment deems best for the benefit of the tenants generally.
2. Landlord may refuse admission to the Building outside of Business
Hours on Business Days (as such terms are defined in the lease to which this
Exhibit is attached) to any person not known to the watchman in charge or not
having a pass issued by Landlord or the tenant whose premises are to be entered
or not otherwise properly identified, and Landlord may require all persons
admitted to or leaving the Building outside of Business Hours on Business Days
to provide appropriate identification. Landlord will supply identification
cards and be reimbursed by Tenant at Landlord's cost. Tenant shall be
responsible for all persons for whom it issues any such pass and shall be liable
to Landlord for all acts or omissions of such persons. Tenant shall promptly
notify Landlord in writing of any lost identification cards and will reimburse
Landlord at cost for replacement of identification cards. Any person whose
presence in the Building at any time shall, in the judgment of Landlord, be
prejudi cial to the safety, of the Building or of its tenants may be denied
access to the Building or may be ejected therefrom. During any invasion, riot,
public excitement or other commotion, Landlord may prevent all access to the
Building by closing the doors or otherwise for the safety of the tenants and
protection of property in the Building.
3. No tenant shall obtain or accept for use in its premises towel,
barbering, bootblacking, floor polishing, cleaning or other similar services
from any persons reasonably prohibited by Landlord in writing from furnishing
such services. Such services shall be furnished only at such hours, and under
such reasonable regulations, as may be fixed by Landlord from time to time.
EXHIBIT C
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Page 1
4. No awnings or other projections shall be attached to the outside
walls of the Building. No curtains, blinds, shades or screens which are
different from the standards adopted by Landlord for the Building shall be
attached to or hung in, or used in connection with, any exterior window or door
of the premises of any tenant, without the prior written consent of Landlord,
not to be unreasonably withheld. Such curtains, blinds, shades or screens must
be of a quality, type, design and color, and attached in the manner approved by
Landlord, not to be unreasonably withheld.
5. No lettering, sign, advertisement, notice or object shall be
displayed in or on the exterior windows or doors, or on the outside of any
tenant's premises, or at any point inside any tenant's premises where the same
might be visible outside of such premises, without the prior written consent of
Landlord, not to be unreasonably withheld. In the event of the violation of the
foregoing by any tenant, Landlord may remove the same without any liability, and
may charge the expense incurred in such removal to the tenant violating this
rule. Interior signs, elevator cab designations and lettering on doors and the
Building directory shall, if and when approved by Landlord, not to be
unreasonably withheld, be inscribed, painted or affixed for each tenant by
Landlord at the expense of such tenant, and shall be of a size, color and style
acceptable to Landlord.
6. The sashes, sash doors, skylights, windows and doors that reflect
or admit light and air into the halls, passageways or other public places in the
Building shall not be covered or obstructed by any tenant, nor shall any
bottles, parcels or other articles be placed on the window xxxxx or on the
peripheral air conditioning enclosures, if any.
7. No showcases or other articles shall be put in front of or affixed
to any part of the exterior of the Building, nor placed in the halls, corridors
or vestibules.
8. No noise, including, but not limited to, music or the playing of
musical instruments, recordings, radio or television, which, in the judgment of
Landlord, might disturb other tenants in the Building, shall be made or
permitted by any tenant.
9. Additional locks or bolts of any kind which shall not be operable
by the Grand Master Key for the Building shall not be placed upon any of the
doors or windows by any tenant, nor shall any changes be made in locks or the
mechanism thereof which shall make such locks inoperable by said Grand Master
Key. Additional keys for a tenant's premises and toilet rooms shall be procured
only from Landlord who may make a reasonable charge therefor. Each tenant
shall, upon the termination of its tenancy, turn over to Landlord all keys of
stores, offices and toilet rooms, either furnished to, or otherwise procured by,
such tenant, and in the event of the loss of any keys furnished by Landlord,
such tenant shall pay to Landlord the cost thereof.
EXHIBIT C
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Page 2
10. All removals, or the carrying in or out of any safes, freight,
furniture, packages, boxes, crates or any other object or matter of any
description must take place during such hours and in such elevators, and in such
manner as Landlord or its agent may determine from time to time. The persons
employed to move safes and other heavy objects shall be reasonably acceptable to
Landlord and, if so required by law, shall hold a Master Rigger's license.
Arrangements will be made by Landlord with any tenant for moving large
quantities of furniture and equipment into or out of the Building. All labor and
engineering costs incurred by Landlord in connection with any moving specified
in this rule, including a reasonable charge for overhead, shall be paid by
Tenant to Landlord, on demand.
11. Landlord reserves the right to inspect all objects and matter to
be brought into the Building and to exclude from the Building all objects and
matter which violate any of these Rules and Regulations or the lease of which
this Exhibit is a part. Landlord may require any person leaving the Building
with any package or other object or matter to submit a pass, listing such
package or object or matter, from the tenant from whose premises the package or
object or matter is being removed, but the establishment and enlargement of such
requirement shall not impose any responsibility on Landlord for the protection
of any tenant against the removal of property from the premises of such tenant.
Landlord shall in no way be liable to any tenant for damages or loss arising
from the admission, exclusion or ejection of any person to or from the premises
or the Building under the provisions of this Rule or of Rule 2 hereof.
12. No tenant shall occupy or permit any portion of its premises to be
occupied as an office for a public stenographer or public typist, or for the
storage, manufacture, or sale of liquor, narcotics, dope, tobacco in any form,
or as a xxxxxx, beauty or manicure shop, or as a school. No tenant shall use or
permit its premises or any part thereof to be used for manufacturing or the sale
at retail or auction of merchandise, goods or property of any kind.
13. Landlord shall have the right to prohibit any advertising or
identifying sign by any tenant which, in Landlord's reasonable judgment, tends
to impair the reputation of the Building or its desirability as a building for
others, and upon written notice from Landlord, such tenant shall refrain from
and discontinue such advertising or identifying sign.
14. Landlord shall have the right to prescribe the weight and position
of safes and other objects of excessive weight, and no safe or other object
whose weight exceeds the lawful load for the area upon which it would stand
shall be brought into or kept upon any tenant's premises. If, in the judgment
of Landlord, it is necessary to distribute the concentrated weight of any heavy
object, the work involved in such distribution shall be done at the expense of
the tenant and in such manner as Landlord shall determine.
EXHIBIT C
---------
Page 3
15. Landlord, its contractors, and their respective employees, shall
have the right to use, without charge therefor, all light, power and water in
the premises of any tenant while cleaning or making repairs or alterations in
the premises of such tenant.
16. No premises of any tenant shall be used for lodging or for any
immoral or illegal purpose.
17. The requirements of tenants will be attended to only upon
application at the office of the Building. Employees of Landlord shall not
perform any work or do anything outside of their regular duties, unless under
special instructions from Landlord.
18. Canvassing, soliciting and peddling in the Building are prohibited
and each tenant shall cooperate to prevent the same.
19. No tenant shall cause or permit any unusual or objectionable odors
to emanate from its premises which would annoy other tenants or create a public
or private nuisance. No cooking (other than coffee, tea or similar pantry items
and pantry-type microwave cooking) shall be done in the premises of any tenant
except as is expressly permitted in such tenant's lease.
20. Nothing shall be done or permitted in any tenant's premises, and
nothing shall be brought into or kept in any tenant's premises, which would
impair or interfere with any of the Building's services or the proper and
economic heating, ventilating, air conditioning, cleaning or other servicing of
the Building or the premises.
21. No acids, vapors or other materials shall be discharged or
permitted to be discharged into the waste lines, vents or flues of the Building
which may damage them. The water and wash closets and other plumbing fixtures
in or serving any tenant's premises shall not be used for any purpose other than
the purposes for which they were designed or constructed, and no sweepings,
rubbish, rags, acids or other foreign substances shall be deposited therein.
All damages resulting from any misuse of the fixtures shall be borne by the
tenant who, or whose servants, employees, agents, visitors or licensees shall
have, caused the same. Any cuspidors or containers or receptacles used as such
in the premises of any tenant or for garbage or similar refuse, shall be
emptied, cared for and cleaned by and at the expense of such tenant.
22. All entrance doors in each tenant's premises shall be left locked
and all windows shall be left closed by the tenant when the tenant's premises
are not in use. Entrance doors shall not be left open at any time.
23. Hand trucks not equipped with rubber tires and side guards shall
not be used within the Building.
EXHIBIT C
---------
Page 4
24. All windows in each tenant's premises shall be kept closed, and
all blinds therein above the ground floor shall be lowered as reasonably
required because of the position of the sun, during the operation of the
Building air-conditioning system to cool or ventilate the tenant's premises. If
Landlord shall elect to install any energy saving film on the windows of any
premises or to install energy saving windows in place of the present windows,
each tenant shall cooperate with the reasonable requirements of Landlord in
connection with such installation and thereafter the maintenance and replacement
of the film and/or windows and permit Landlord to have access to the tenant's
premises at reasonable times during Business Hours to perform such work.
EXHIBIT C
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Page 5
PARKING AREA
------------
EXHIBIT D
---------
HVAC SPECIFICATIONS AND CURRENT COST
------------------------------------
EXHIBIT E
---------
OTHER TENANTS WITH EXPANSION RIGHTS
-----------------------------------
EXHIBIT F
---------
CLEANING SPECIFICATIONS
-----------------------
EXHIBIT G
---------
INTENTIONALLY OMITTED
---------------------
EXHIBIT H
---------
FORM OF SNDA
------------
EXHIBIT I
---------
FIRST OFFER SPACE
-----------------
EXHIBIT J
---------
EQUIPMENT TO BE FURNISHED
BY LANDLORD
-------------------------
EXHIBIT K
---------
