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EXHIBIT 10.64
ROCKEFELLER CENTER
LEASE
FEBRUARY 27, 1998
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RCPI TRUST,
Landlord
and
THE SPORTS CLUB COMPANY, INC.,
Tenant
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LEASE
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A portion of the 1st, 2nd, 3rd and 4th Floors
000 Xxxxx Xxxxxx
Xxxxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx
DATED: February 27, 1998
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TABLE OF CONTENTS
ARTICLE 1 BASIC LEASE PROVISIONS..............................................1
ARTICLE 2 PREMISES; TERM; RENT................................................4
ARTICLE 3 USE AND OCCUPANCY...................................................5
ARTICLE 4 CONDITION OF THE PREMISES...........................................9
ARTICLE 5 ALTERATIONS........................................................11
ARTICLE 6 FLOOR LOAD.........................................................15
ARTICLE 7 REPAIRS............................................................15
ARTICLE 8 INCREASES IN REAL ESTATE TAXES AND
OPERATING EXPENSES.................................................17
ARTICLE 9 REQUIREMENTS OF LAW................................................25
ARTICLE 10 QUIET ENJOYMENT....................................................28
ARTICLE 11 SUBORDINATION......................................................28
ARTICLE 12 SERVICES...........................................................30
ARTICLE 13 INSURANCE, PROPERTY LOSS OR DAMAGE;
REIMBURSEMENT......................................................34
ARTICLE 14 DESTRUCTION - FIRE OR OTHER CAUSE..................................37
ARTICLE 15 EMINENT DOMAIN.....................................................40
ARTICLE 16 ASSIGNMENT AND SUBLETTING..........................................42
ARTICLE 17 ELECTRICITY........................................................51
ARTICLE 18 ACCESS TO PREMISES.................................................53
ARTICLE 19 DEFAULT............................................................54
ARTICLE 20 REMEDIES AND DAMAGES...............................................57
ARTICLE 21 LANDLORD'S RIGHT TO CURE; REIMBURSEMENT............................59
ARTICLE 22 NO REPRESENTATIONS BY LANDLORD; LANDLORD'S
APPROVAL...........................................................60
ARTICLE 23 END OF TERM........................................................61
ARTICLE 24 NO SURRENDER; NO WAIVER............................................62
ARTICLE 25 WAIVER OF TRIAL BY JURY............................................63
ARTICLE 26 ADJACENT EXCAVATION; SHORING.......................................63
ARTICLE 27 NOTICES............................................................63
ARTICLE 28 RULES AND REGULATIONS..............................................64
ARTICLE 29 PARTNERSHIP TENANT.................................................65
ARTICLE 30 VAULT SPACE........................................................66
ARTICLE 31 LANDLORD'S AGENT...................................................67
ARTICLE 32 INDEMNITY..........................................................67
ARTICLE 33 TAX STATUS OF BENEFICIAL OWNERS....................................69
ARTICLE 34 SECURITY DEPOSIT...................................................69
ARTICLE 35 MISCELLANEOUS......................................................72
ARTICLE 36 USE OF PREMISES....................................................75
ARTICLE 37 RENEWAL OPTIONS....................................................81
ARTICLE 38 SPECIAL PROVISION..................................................83
ARTICLE 39 RGTS AREA..........................................................84
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EXHIBITS:
A - FLOOR PLANS
B - DEFINITIONS
C - DIAGRAM OF THE PROTECTED ZONE
D - TENANT'S WORK: RETAIL TENANT ALTERATION REQUIREMENTS
E - RULES AND REGULATIONS
F - [Intentionally Deleted]
G - [Intentionally Deleted]
H - [Intentionally Deleted]
I - FORM OF LETTER OF CREDIT
J - FORM OF LICENSE AGREEMENT
K - EXHAUST AND DUCT PLAN
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LEASE
THIS LEASE is made as of the ____ day of February, 1998 between RCPI
TRUST, a Delaware business trust having an office c/o Tishman Speyer Properties,
L.P., 00 Xxxxxxxxxxx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000 ("Landlord"), and THE
SPORTS CLUB COMPANY, INC., a Delaware corporation having an office at 00000
Xxxxx Xxxxxx Xxxxxxxxx, Xxxxx 000, Xxxx Xxx Xxxxxxx, Xxxxxxxxxx 00000
("Tenant").
Landlord and Tenant hereby covenant and agree as follows:
ARTICLE 1
BASIC LEASE PROVISIONS
PREMISES Portions of the first (1st), second (2nd), third (3rd) and
fourth (4th) floors of the Building, substantially as shown
on Exhibit A, containing in the aggregate, 88,927 rentable
square feet. The Premises include (i) 1,344 rentable square
feet located on the first floor of the Building (the "First
Floor Premises"), as shown on Exhibit A-1; (ii) 16,087
rentable square feet located on the second floor of the
Building (the "Second Floor A Premises"), as shown on
Exhibit A-2; (iii) 2,794 rentable square feet located on the
second floor of the Building (the "Second Floor B
Premises"), as shown on Exhibit A-3; (iv) 10,867 rentable
square feet located on the second floor of the Building (the
"Second Floor C Premises"), as shown on Exhibit A-4; (v)
52,886 rentable square feet located on the third floor of
the Building (the "Third Floor Premises"), as shown on
Exhibit A-5; and (vi) 4,949 rentable square feet located on
the fourth floor of the Building (the "Fourth Floor
Premises"), as shown on Exhibit A-6.
BUILDING The building, fixtures, equipment and other improvements and
appurtenances now located or hereafter erected, located or
placed upon the land known as 000 Xxxxx Xxxxxx, Xxx Xxxx,
Xxx Xxxx.
COMMENCEMENT DATE The date of execution and delivery of this Lease by
Landlord and Tenant.
RENT COMMENCEMENT For and with respect to each of the First Floor Premises,
DATE(S) the Second Floor A Premises, the Second Floor B Premises,
the Second Floor C Premises, the Third Floor Premises and
the Fourth Floor Premises, the date which is 9 calendar
months after the date on which Landlord delivers possession
of the applicable Portion of the Premises to Tenant in
accordance with the provisions of this Lease.
EXPIRATION DATE The last day of the calendar month in which the day
preceding the 15th anniversary of the Commencement Date
occurs, or if the term of this Lease shall be extended in
accordance with the
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provisions of Section 37 of this Lease, the last day of any
renewal or extended term.
TERM The period commencing on the Commencement Date and ending on
the Expiration Date.
PERMITTED USES Provide health club services and/or sports club
services to the public, in a manner and fashion not
materially different from those provided on the date of this
Lease by the facility known as "The Reebok Sports Club"
located at 000 Xxxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx, but
never less than such other services as may be added to the
foregoing facility from time-to-time during the Term
(excepting only as permitted pursuant to the provisions of
Section 36.2(k) of this Lease), and subject to the terms and
provisions of this Lease, including Article 36 hereof and
for no other purpose or purposes.
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BASE TAX YEAR The Tax Year commencing on July 1, 1997 and ending on June
30, 1998.
BASE OPERATING The Computation Year commencing on January 1, 1997 and
YEAR ending on December 31, 1997.
TENANT'S AREA The aggregate number of rentable square feet contained
in the Portion(s) of the Premises delivered to Tenant from
time to time.
FIXED RENT For each portion of the Premises as follows: (i) at the
rate computed on the basis of $40.00 per rentable square
foot per annum, in equal monthly installments, for the
period commencing on the applicable Rent Commencement Date
and ending on the last day immediately preceding the 5th
anniversary of the Commencement Date, both dates being
inclusive, and proportionately at such rate for any partial
month during said period; (ii) at the rate computed on the
basis of $44.80 per rentable square foot per annum, in equal
monthly installments, for the period commencing on the 5th
anniversary of the Commencement Date and ending on the last
day immediately preceding the 10th anniversary of the
Commencement Date, both dates being inclusive, and
proportionately at such rate for any partial month during
said period; and (iii) at the rate computed on the basis of
$50.18 per rentable square foot per annum, in equal monthly
installments, for the period commencing on the 10th
anniversary of the Commencement Date and ending on the
Expiration Date, both dates being inclusive, and
proportionately at such rate for any partial month during
said period.
ADDITIONAL RENT All sums other than Fixed Rent payable by Tenant to
Landlord under this Lease, including Tenant's Tax Payment
and Tenant's Operating Payment (as required pursuant to
Article 8), late charges, overtime or excess service
charges, and interest and other costs related to Tenant's
failure to perform any of its obligations under this Lease.
RENT Fixed Rent and Additional Rent, collectively.
SECURITY DEPOSIT $4,000,000.00, subject to the provisions of Article 34.
LANDLORD'S AGENT Tishman Speyer Properties, L.P., or any other Person
designated by Landlord from time to time as Landlord's
Agent.
TENANT'S AGENT Colliers ABR, Inc.
LANDLORD'S $37.00 per rentable square foot of floor area in the
CONTRIBUTION Premises.
All capitalized terms used in the text of this Lease which are not
otherwise defined herein, shall have the meanings ascribed to them in this
Article 1 or in Exhibit B.
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ARTICLE 2
PREMISES; TERM; RENT
Section 2.1 LEASE OF PREMISES. Subject to the terms of this Lease,
Landlord leases the Premises to Tenant, and Tenant leases the Premises from
Landlord, for the Term, excepting and reserving to Landlord the exterior walls
of the Building and further reserving to Landlord the right to place above the
dropped ceiling and/or below the floor in the Premises (in such manner as to
reduce to a minimum the interference with Tenant's use of the Premises) utility
lines, pipes, conduits, exhausts, and the like, to serve premises other than the
Premises, and to replace and maintain and repair such utility lines, pipes,
conduits, exhausts (including the kitchen exhausts and ducts depicted in the
exhaust and duct plan attached hereto as Exhibit K), and the like in, over and
upon the Premises as may have been or may be installed by Landlord in the
Building. As used herein, the phrase "Portion(s) of the Premises" means the
First Floor Premises, the Second Floor A Premises, the Second Floor B Premises,
the Second Floor C Premises, the Third Floor Premises and/or the Fourth Floor
Premises, individually and collectively.
Section 2.2 PAYMENT OF RENT. Tenant shall pay to Landlord, without
notice or demand, and without any set-off, counterclaim, abatement or deduction
whatsoever, except as may be expressly set forth in this Lease, in lawful money
of the United States, by wire transfer of funds to Landlord's account, as
designated by Landlord, or
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by check drawn upon a bank approved by Landlord, at Landlord's office at 00
Xxxxxxxxxxx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000, or such other place as Landlord
shall from time to time designate in writing: (i) Fixed Rent in equal monthly
installments, in advance, on the first day of each calendar month during the
Term, commencing on the applicable Rent Commencement Date, and (ii) Additional
Rent, at the times and in the manner set forth in this Lease.
Section 2.3 FIRST MONTH'S RENT. Tenant shall pay an amount equal to
$266,213.33 upon the execution and delivery of this Lease (the "Initial
Payment"). If the Rent Commencement Date for any portion of the Premises is on
the first day of a calendar month, then such payment shall be credited towards
such month's Fixed Rent payment; provided, however if pursuant to the provisions
of this Lease (including Section 3.2 hereof) the amount due on account of Fixed
Rent for said month is less than the Initial Payment, then the excess, if any,
will be credited toward the Fixed Rent payment due for the next succeeding
calendar month. If the Rent Commencement Date for any portion of the Premises is
not the first day of a calendar month, then, on the applicable Rent Commencement
Date Tenant shall pay the proportionate amount of the Fixed Rent which is
payable for the period from the applicable Rent Commencement Date through the
last day of such month, and the Initial Payment shall be credited towards the
Fixed Rent which is payable for the next succeeding calendar month; provided,
however if pursuant to the provisions of this Lease (including Section 3.2
hereof) the amount due on account of Fixed Rent for said month is less than the
Initial Payment, then the excess, if any, will be credited toward the Fixed Rent
payment due for the next succeeding calendar month.
Section 2.4 INTEREST. If Tenant shall fail to pay any installment or
other payment of Rent when due, interest shall accrue on such installment or
payment as a late charge, from the date such installment or payment became due
until the date paid, at the Interest Rate.
ARTICLE 3
USE AND OCCUPANCY
Section 3.1 (a) PERMITTED USES. Tenant shall use and occupy the Premises
for the Permitted Uses and for no other purpose or purposes. Tenant shall not
use or occupy or suffer the use or occupancy of any part of the Premises in a
manner constituting a Prohibited Use. If Tenant uses or suffers the use of the
Premises for a purpose which constitutes a Prohibited Use or violates any
Requirement, or which causes the Building to be in violation of any Requirement,
then Tenant shall promptly discontinue such use upon notice of such violation.
(b) LICENSES AND PERMITS. Tenant, at its expense, shall obtain
and at all times maintain and comply with the terms and conditions of all
licenses and permits required for the lawful conduct of the Permitted Uses in
the Premises.
Section 3.2 (a) DELIVERY OF PREMISES. Landlord shall be deemed to have
delivered possession of any Portion(s) of the Premises to Tenant upon the giving
of notice by Landlord to Tenant stating that the applicable Portion of the
Premises is vacant, in the condition required under this Lease, and available
for Tenant's occupancy. Subject to the provisions of this Lease, Landlord agrees
to deliver each Portion of the Premises to Tenant promptly after the same are
vacated by the former tenant(s) or occupant(s). At all times prior to the
delivery of any Portion of the Premises, said Portion of the Premises shall not
be considered to be a part of the Premises and Tenant shall have no rights or
obligations with respect thereto, including the right to enter said Portion of
the Premises. Upon delivery of any Portion of the Premises, said Portion of the
Premises shall automatically be and become a part of the "Premises" for all
purposes under this Lease and the number of rentable square feet contained in
said Portion of the Premises shall be added to and become a part of the
"Tenant's Area." Without limiting the foregoing, upon request by Landlord or
Tenant, from time-to-time, the parties will execute a written instrument or
instruments setting forth the Portions of the Premises delivered to Tenant as of
said date and the Fixed Rent payable in connection therewith. The failure of
either party to execute and deliver said instrument shall not affect the rights,
obligations or interests of the parties. Landlord shall not be liable for the
failure of former tenants or occupants to vacate any Portion of the Premises, or
its failure to deliver possession
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of the applicable Portion of the Premises to Tenant on any specified date, and
subject only to the provisions of the next succeeding paragraph, any such
failure shall not impair the validity of this Lease or the effectiveness thereof
with respect to those Portions of the Premises which are delivered to Tenant.
Tenant acknowledges that the Second Floor B Premises, the Second Floor C
Premises, the Third Floor Premises, and the Fourth Floor Premises, are leased to
or occupied by other tenants or occupants and that the terms of the existing
lease agreements with respect to the Second Floor B Premises, the Second Floor C
Premises and the Fourth Floor Premises presently expire on September 30, 2009,
June 27, 1999 and April 30, 2000, respectively.
(b) DELIVERY OF FIRST FLOOR PREMISES, SECOND FLOOR A PREMISES AND THIRD
FLOOR PREMISES. Landlord shall deliver the First Floor Premises, the Second
Floor A Premises and the Third Floor Premises concurrently. Landlord will
exercise commercially reasonable efforts to deliver each of the First Floor
Premises, the Second Floor A Premises and the Third Floor Premises by not later
than January 1, 1999, subject, however to Unavoidable Delays, in which event
Landlord will exercise commercially reasonable efforts to deliver each of the
First Floor Premises, the Second Floor A Premises, and the Third Floor Premises
by not later than August 1, 1999 (the "Outside Delivery Date"). If Landlord
delivers each of the First Floor Premises, the Second Floor A Premises and the
Third Floor Premises prior to the termination of this Lease by Landlord or
Tenant pursuant to and in accordance with the provisions of this Section 3.2(b),
then notwithstanding Landlord's failure to deliver any other Portions of the
Premises, this Lease shall remain in full force and effect with respect to those
Portions of the Premises which are delivered to Tenant. If notwithstanding
Landlord's reasonable efforts Landlord has not delivered each of the First Floor
Premises, the Second Floor A Premises and the Third Floor Premises by the
Outside Delivery Date, then at any time thereafter prior to delivery of said
Portions of the Premises, either Landlord or Tenant may elect, at their
respective options, by providing notice thereof to the other, to terminate this
Lease, and this Lease shall terminate on the 45th day after the giving of such
notice, unless within said 45 day period Landlord delivers the previously
undelivered Portion (or Portions) of the Premises to Tenant. If this Lease is
terminated as aforesaid, then Tenant shall surrender, in accordance with the
requirements of this Lease, possession of all Portions of the Premises
previously delivered to it, this Lease shall be of no further force and effect
after the date of termination, and neither party shall have any further
obligations to the other in connection with this Lease, subject, however to the
payment by Tenant to Landlord of all sums then due and owing or having accrued
to Landlord hereunder.
Notwithstanding the foregoing, if Landlord in its good faith discretion
determines that notwithstanding its reasonable efforts Landlord will be unable
to deliver each of the First Floor Premises, the Second Floor A Premises and the
Third Floor Premises prior to the Outside Delivery Date, then at any time after
Landlord makes such determination and prior to delivery of said Portions of the
Premises, Landlord may elect, at its option, by providing notice thereof to
Tenant, to terminate this Lease. If this Lease is terminated as aforesaid, then
Tenant shall surrender, in accordance with the requirements of this Lease,
possession of all Portions of the Premises previously delivered to it, this
Lease shall be of no further force and effect after the date of termination, and
neither party shall have any further obligations to the other in connection with
this Lease, subject, however to the payment by Tenant to Landlord of all sums
then due and owing or having accrued to Landlord hereunder.
(c) DELIVERY OF SECOND FLOOR B PREMISES, SECOND FLOOR C PREMISES AND
FOURTH FLOOR PREMISES. Landlord shall not deliver the Second Floor C Premises
unless the Second Floor B Premises are delivered concurrently therewith.
Landlord will exercise commercially reasonable efforts to deliver each of the
Second Floor B Premises, the Second Floor C Premises, and the Fourth Floor
Premises as soon as practicable after the date of this Lease. If notwithstanding
Landlord's reasonable efforts Landlord has not delivered the Second Floor B
Premises by January 1, 2001, then at any time thereafter prior to delivery of
said Portions of the Premises, Landlord may elect, at its option, by providing
notice thereof to Tenant, to terminate this Lease with respect to the Second
Floor B Premises and the Second Floor C Premises, in which event the Second
Floor B Premises and the Second Floor C Premises shall be removed from the
Premises, and this Lease shall remain in full force and effect with respect to
all other Portions of the Premises previously delivered to Tenant. If the Second
Floor B Premises and the Second Floor C Premises are removed from the Premises
as aforesaid, then Tenant shall have no further rights
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or obligations with respect thereto, and Landlord will be free to lease and deal
with the Second Floor B Premises and the Second Floor C Premises free of any
rights or claims of any Tenant Party.
Notwithstanding the foregoing, if Landlord in its good faith discretion
determines that notwithstanding its reasonable efforts Landlord will be unable
to deliver each of the Second Floor B Premises and the Second Floor C Premises
prior to January 1, 2001, then at any time after Landlord makes such
determination and prior to delivery of said Portions of the Premises, Landlord
may elect, at its option, by providing notice thereof to Tenant, to terminate
this Lease with respect to the Second Floor B Premises and the Second Floor C
Premises, in which event the Second Floor B Premises and the Second Floor C
Premises shall be removed from the Premises, and this Lease shall remain in full
force and effect with respect to all other Portions of the Premises previously
delivered to Tenant. If the Second Floor B Premises and the Second Floor C
Premises are removed from the Premises as aforesaid, then Tenant shall have no
further rights or obligations with respect thereto, and Landlord will be free to
lease and deal with the Second Floor B Premises and the Second Floor C Premises
free of any rights or claims of any Tenant Party.
The provisions of this Article are intended to constitute "an express
provision to the contrary" within the meaning of Section 223-a of the New York
Real Property Law or any successor Requirement.
Section 3.3 USE OF BUILDING NAME. Concurrently herewith, Tenant has
entered into a sublicense agreement (the "Sublicense Agreement") in the form
attached hereto as Exhibit J, pursuant to which Tenant may use the trade name
"Sports Club Rockefeller Center" in connection with the business to be conducted
by Tenant in the Premises. Except as expressly and specifically permitted
pursuant to the provisions of the Sublicense Agreement, no Tenant Party shall
use the words "Rockefeller Center", "Radio City" or "Radio City Music Hall" or
any combination or simulation thereof, or any logo or image of Rockefeller
Center, or the image of any prominent part of Rockefeller Center, for any
purpose whatsoever, including as or for any corporate, firm or trade name,
trademark or designation or description of merchandise or services; provided,
however, that the foregoing shall not prevent the use by Tenant or other
permitted occupant of the Premises, in a conventional manner and without
emphasis or display, of the words "Rockefeller Center" and/or, where applicable,
"Rockefeller Plaza," as part of Tenant's or such permitted occupant's business
address or for reference purposes in the ordinary course of its business.
Landlord agrees that if Tenant assigns this Lease in accordance with the
provisions of Article 16 of this Lease, then upon Tenant's request, Landlord
will enter into a sublicense agreement substantially in the form of the
Sublicense Agreement with said assignee. Landlord agrees that if Tenant enters
into a sublease for all or a portion of the Premises in accordance with the
provisions of Article 16 of this Lease, then upon Tenant's request, subject to
Landlord's prior approval of the proposed use of the Rockefeller Center Xxxx (as
defined in the Sublicense Agreement) by the subtenant, Landlord will enter into
a sublicense agreement substantially in the form of the Sublicense Agreement
with said subtenant. Neither Tenant nor any occupant of the Premises shall use
the name of the Building or the name of the entity for which the Building is
named or designated by Landlord or any part or abbreviation (including initials)
of any such name, except in a conventional manner, and without emphasis or
display, as a part of Tenant's or such permitted occupant's business address.
Section 3.4 BROADCAST RESTRICTIONS. Neither Tenant nor any Tenant Party
shall (i) conduct or permit to be conducted any Broadcast activities or video
production activities from any area of the Center, (ii) install or display any
signs, symbols or logos within the Center which are commonly identified with any
Broadcast or cable network or any Broadcast or video production activities or
(iii) use or permit the use of Protected Zone Images in any Broadcast.
"Broadcast" means the transmission of video programming, including news footage
clips, by any means, including over-the air television broadcasting, cable
television distribution and the like, and including successor distribution
technologies which are comparable to the foregoing (but "Broadcast" shall not be
deemed to include teleconferencing, private video telephone communications or
other similar means of video transmission which are not intended for public
distribution). "Protected Zone Images" means visual images of all or any part of
the area consisting of the Plaza, the Plaza Street, the Channel Gardens, the
Center skating rink and areas adjacent thereto, as shown on the diagram of the
Protected Zone attached as Exhibit C to this Lease.
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Section 3.5 EXCLUSIVE. Provided that Tenant operates its business in the
Premises in accordance with all of the terms, provisions and conditions of this
Lease, and provided that this Lease is in full force and effect, Landlord agrees
(insofar as, to the extent and for such period of time as applicable law shall
permit the same) that during the Term Landlord will not enter into any lease for
any other premises in the Center which permits the use of said premises during
the Term principally or primarily as a fitness/health club facility which is
open to the general public or with respect to which memberships are available to
the general public; provided, however, that the foregoing shall not prevent or
preclude Landlord from entering into leases which permit tenants to operate (i)
health club facilities which are not open to the general public or with respect
to which memberships are not available to the general public, (ii) health club
and/or fitness facilities which are incidental or accessory to a principal or
primary use, or (iii) spa, salon or sports medicine facilities which may or may
not be open to the general public, or with respect to which memberships may or
may not be available to the general public. In no event shall Tenant, by reason
of Landlord's breach of the foregoing covenant, have the right to terminate this
Lease or to withhold payment of Rent or other charges due hereunder or to obtain
monetary damages from Landlord. Tenant's sole remedy on account of a breach of
the foregoing covenant shall be to seek injunctive relief against Landlord
compelling Landlord to comply with the foregoing covenant.
ARTICLE 4
CONDITION OF THE PREMISES
Section 4.1 CONDITION; INITIAL CONSTRUCTION OF THE PREMISES. Tenant has
inspected the Premises and agrees (i) to accept possession of each portion of
the Premises in the "as is" condition existing on the date of delivery thereof
to Tenant, (ii) that neither Landlord nor Landlord's agents have made any
representations or warranties with respect to the Premises or the Building
except as expressly set forth herein, and (iii) Landlord has no obligation to
prepare the Premises for use and occupancy by Tenant or to perform any work,
supply any materials, incur any expense (excepting only Landlord's
Contribution), or make any alterations, additions, or improvements to the
Premises to prepare the Premises for Tenant's use and occupancy. Tenant's
occupancy of any part of the Premises shall be conclusive evidence, as against
Tenant, that Tenant has accepted possession of the Premises in their
then-current condition, and the Premises and the Building are in a good and
satisfactory condition as required by this Lease.
Promptly after delivery of possession of each Portion of the Premises to
Tenant, Tenant shall, at its own cost and expense (excepting only Landlord's
Contribution) perform or cause to be performed, any and all work necessary to
prepare such portion of the Premises for Tenant's initial occupancy thereof, in
accordance with and subject to the terms and provisions of this Lease, including
Article 5. Such work to be performed by Tenant shall include any and all work
required to cause the Premises (which shall include all means of access and
egress to, from and between the floors comprising parts of the Premises) to
comply with all conditions and Requirements imposed by Governmental Authorities
in connection with the issuance of all permits, approvals and certificates
(including certificates of occupancy) relating to the Premises; provided, that,
in connection with the calculation of the availability of egress from the
Premises if another tenant (other than Tenant) on any floor has access to any
stairway, then said stairway may only be included in the foregoing calculation
by Tenant to the extent not included by such other tenant(s) in their respective
calculations.
Section 4.2 LANDLORD'S CONTRIBUTION. (a) Landlord agrees to pay to
Tenant, toward payment of the cost of the work to be performed by Tenant in
connection with Tenant's initial occupancy of each Portion of the Premises (the
"Initial Installations"), an amount not to exceed Landlord's Contribution for
such Portion of the Premises, provided that as of the date on which Landlord is
required to make each respective payment pursuant to Section 4.2(b): (i) this
Lease is in full force and effect, and (ii) no Event of Default then exists.
Tenant shall pay all costs of the Initial Installations in excess of Landlord's
Contribution. Landlord's Contribution shall be payable solely on account of
labor directly related to the Initial Installations and materials delivered to
the Premises in connection with the Initial Installations, except that Tenant
may apply up to 5% of Landlord's Contribution to pay "soft costs" incurred in
connection with the Initial Installations, which shall be limited to the actual
architectural, consulting and
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engineering fees incurred by Tenant in connection therewith. Tenant shall not be
entitled to receive any portion of Landlord's Contribution not actually expended
by Tenant in the performance of the Initial Installations in accordance with
this Section 4.2, nor shall Tenant have any right to apply any unexpended
portion of Landlord's Contribution as a credit against Rent or any other
obligation of Tenant hereunder. Notwithstanding anything to the contrary
contained in this Section 4.2, Tenant shall not be entitled to receive any
portion of Landlord's Contribution payable with respect to any Portion of the
Premises prior to delivery to Tenant of the applicable Portion of the Premises.
(b) Landlord shall make progress payments of Landlord's Contribution to
Tenant on a monthly basis, for the work performed during the previous month,
less a retainage of 10% of each progress payment (the "Retainage"). Each of
Landlord's progress payments will be limited to an amount equal to the aggregate
amounts (reduced by the Retainage) theretofore paid by Tenant (as certified by
the chief financial officer of Tenant and by Tenant's independent, licensed
architect) to Tenant's contractors, subcontractors and material suppliers which
have not been the subject of a previous disbursement from Landlord's
Contribution for such Portion of the Premises, multiplied by a fraction, the
numerator of which is the amount of Landlord's Contribution for such Portion of
the Premises, and the denominator of which is the total contract price (or, if
there is no specified or fixed contract price for the Initial Installations for
such Portion of the Premises, then Landlord's reasonable estimate thereof) for
the performance of all of the Initial Installations for such Portion of the
Premises shown on all plans and specifications approved by Landlord, provided
that in no event shall such fraction be greater than 1. Such progress payments
shall be made no more than once each calendar month within 30 days next
following the delivery to Landlord of requisitions therefor, signed by a
financial officer of Tenant, which requisitions shall set forth the names of
each contractor, subcontractor and material supplier to whom payment is due, and
the amount thereof, and shall be accompanied by (1) with the exception of the
first requisition, copies of partial waivers of lien from all contractors,
subcontractors and material suppliers covering all work and materials which were
the subject of previous progress payments by Landlord and Tenant, (2) a written
certification from Tenant's architect that the work for which the requisition is
being made has been completed in accordance with the plans and specifications
approved by Landlord, and (3) such other documents and information as Landlord
may reasonably request. Landlord shall disburse the Retainage upon submission by
Tenant to Landlord of a requisition therefor, accompanied by all documentation
required under clauses (1), (2) and (3) above, together with (A) proof of the
satisfactory completion of all required inspections and issuance of any required
approvals, permits and sign-offs for the Initial Installations by all
Governmental Authorities having jurisdiction thereover, (B) final "as-built"
plans and specifications for the Initial Installations, and (C) the issuance of
final lien waivers by all contractors, subcontractors and material suppliers
covering all of the Initial Installations. Notwithstanding anything to the
contrary set forth in this Section 4.2, if Tenant fails to pay when due any sums
due and payable to any of Tenant's contractors, subcontractors or material
suppliers, Landlord shall have the right, but not the obligation, to pay to such
contractor, subcontractor or supplier all sums so due from Tenant, and sums so
paid by Landlord shall be deemed additional rent and shall be paid by Tenant
within 10 Business Days after Landlord delivers to Tenant an invoice therefor.
The right to receive Landlord's Contribution is for the exclusive benefit of
Tenant, and in no event shall such right be assigned to or be enforceable by or
for the benefit of any third party, including any contractor, subcontractor,
materialman, laborer, architect, engineer, attorney or any other Person.
ARTICLE 5
ALTERATIONS
Section 5.1 TENANT'S ALTERATIONS. (a) Tenant shall not make any
alterations, additions, improvements, or other physical changes in or about the
Premises, including the Initial Installations (collectively, "Alterations"),
other than decorative Alterations such as painting, wall coverings and floor
coverings (collectively, "Decorative Alterations"), without obtaining in each
instance, Landlord's prior consent, which consent may be withheld in Landlord's
sole discretion. Notwithstanding the foregoing, Landlord will not unreasonably
withhold its consent to proposed Alterations so long as such Alterations (i) are
non-structural and do not affect the Building Systems, (ii) are performed only
by Landlord's designated contractors or by contractors approved by Landlord to
perform such Alterations, (iii) affect only
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the Premises and are not visible from outside of the Premises or the Building,
(iv) do not affect the certificate of occupancy issued for the Building or the
Premises, (v) are consistent with the design, construction and equipment of the
Building and the Center, and (vi) do not adversely affect any service furnished
by Landlord in connection with the operation of the Building or the Center.
(b) PLANS AND SPECIFICATIONS. Prior to making any Alterations, Tenant,
at its expense, shall (i) submit to Landlord for its approval, detailed plans
and specifications (including layout, architectural, mechanical, electrical,
plumbing, sprinkler and structural drawings) of each proposed Alteration, other
than Decorative Alterations (said plans shall be delivered with a notice to
Landlord expressly stating that Landlord should identify all Specialty
Alterations (hereinafter defined) while reviewing said plans and
specifications), and with respect to any Alteration affecting any Building
System, Tenant shall submit proof that the Alteration has been designed by, or
reviewed and approved by, Landlord's designated engineer for the affected
Building System, (ii) obtain all permits, approvals and certificates required by
any Governmental Authorities (including a PW-1 Form, approved by applicable
Governmental Authorities, for amending the certificate of occupancy, and all
public assembly permits, and physical culture establishment permits), (iii)
furnish to Landlord duplicate original policies or certificates of workers
compensation insurance (covering all persons to be employed by Tenant, and
Tenant's contractors and subcontractors in connection with such Alteration),
comprehensive public liability (including property damage coverage) and
builder's risk insurance coverage (issued on a completed value basis) all in
such form, with such companies, for such periods and in such amounts as Landlord
may reasonably require, naming Landlord, the Indemnitees and any other parties
designated by Landlord as additional insureds, and (iv) furnish to Landlord such
other evidence of Tenant's ability to complete and to fully pay for such
Alterations (other than Decorative Alterations) as is reasonably satisfactory to
Landlord. Upon Tenant's request, Landlord shall exercise reasonable efforts to
cooperate with Tenant in obtaining any permits, approvals or certificates
required to be obtained by Tenant in connection with any permitted Alteration
(if the provisions of the applicable Requirement require that Landlord join in
such application), provided that Tenant shall reimburse Landlord for any cost,
expense or liability incurred by Landlord in connection therewith. Tenant shall
give Landlord not less than 5 Business Days' notice prior to performing any
Decorative Alteration which is not consistent with, or of the same type, design
and style as those installed as part of the Initial Installations, which notice
shall contain a description of such Decorative Alteration. Without limitation,
all Alterations (including Decorative Alterations) shall be of equal or better
quality as those installed as part of the Initial Installations.
(c) GOVERNMENTAL APPROVALS, PLANS. Upon completion of any
Alterations, Tenant, at its expense, shall promptly obtain all certificates of
final approval of such Alterations required by any Governmental Authority
(including all certificates of occupancy, public assembly permits, and physical
culture establishment permits), and shall furnish Landlord with copies thereof,
together with "as-built" plans and specifications for such Alterations (other
than Decorative Alterations) prepared on an Autocad Computer Assisted Drafting
and Design System (or such other system or medium as Landlord may accept) using
naming conventions issued by the American Institute of Architects in June, 1990
(or such other naming convention as Landlord may accept) and magnetic computer
media of such record drawings and specifications, translated into DXF format or
another format acceptable to Landlord.
(d) LANDMARKS PRESERVATION. TENANT IS HEREBY NOTIFIED THAT THE
PREMISES ARE SUBJECT TO THE JURISDICTION OF THE CITY OF NEW YORK LANDMARKS
PRESERVATION COMMISSION. IN ACCORDANCE WITH SECTIONS 25-305, 25-306, 25-309 AND
25-310 OF THE ADMINISTRATIVE CODE OF THE CITY OF NEW YORK AND THE RULES SET
FORTH IN TITLE 63 OF THE RULES OF THE CITY OF NEW YORK, ANY DEMOLITION,
CONSTRUCTION, RECONSTRUCTION, ALTERATION OR MINOR WORK AS DESCRIBED IN SUCH
SECTIONS AND SUCH RULES MAY NOT BE COMMENCED WITHIN OR AT THE PREMISES WITHOUT
THE PRIOR WRITTEN APPROVAL OF THE LANDMARKS PRESERVATION COMMISSION. TENANT IS
NOTIFIED THAT SUCH DEMOLITION, CONSTRUCTION, RECONSTRUCTION, ALTERATIONS OR
MINOR WORK INCLUDES, BUT IS NOT LIMITED TO, (A) WORK TO THE EXTERIOR OF THE
PREMISES INVOLVING WINDOWS, SIGNS, AWNINGS, FLAGPOLES, BANNERS AND STOREFRONT
ALTERATIONS AND (B) INTERIOR WORK TO THE PREMISES THAT (I) REQUIRES A PERMIT
FROM THE DEPARTMENT OF BUILDINGS OR (II) CHANGES, DESTROYS OR AFFECTS AN
INTERIOR ARCHITECTURAL FEATURE OF AN INTERIOR LANDMARK OR AN EXTERIOR
ARCHITECTURAL FEATURE OF AN IMPROVEMENT THAT IS A LANDMARK OR LOCATED ON A
LANDMARK SITE OR IN A HISTORIC DISTRICT.
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Section 5.2 MANNER AND QUALITY OF ALTERATIONS. All Alterations shall be
performed (i) in a good and first-class workmanlike manner and free from
defects, (ii) in accordance with the plans and specifications as required under
Section 5.1, and by contractors, approved by Landlord, (iii) excepting only for
Decorative Alterations, under the supervision of a licensed architect reasonably
satisfactory to Landlord, and (iv) in compliance with all Requirements, the
terms of this Lease including the Tenant Design and Work Specifications attached
hereto as Exhibit D and incorporated herein by this reference, all procedures
and regulations then prescribed by Landlord for work performed in the Building,
and the Rules and Regulations. All materials and equipment to be used in the
Premises shall be of first quality and at least equal to the applicable
standards for the Building then established by Landlord, and no such materials
or equipment shall be subject to any lien or other encumbrance.
Section 5.3 RESTORATION OF PREMISES; REMOVAL OF TENANT'S PROPERTY. All
Building Standard Installations (as hereinafter defined) shall be and remain the
property of Landlord, shall remain upon the Premises and shall not be removed by
Tenant and at the expiration or termination of the Term shall be surrendered
with the Premises as a part thereof without disturbance, molestation or injury.
All Above Building Standard Installations (as hereinafter defined) and Tenant's
Property shall be and, except as hereinafter provided, shall remain the property
of Tenant. On or prior to the Expiration Date or sooner termination of the Term,
Tenant shall, at Tenant's expense, remove all of Tenant's Property and, unless
otherwise directed in writing by Landlord: (i) close up any slab penetrations,
restore all structural steel and Building Systems previously removed by Tenant
in the Premises and (ii) remove any kitchen facilities, raised floors, internal
stairways, vaults, private lavatories, libraries, vertical transportation
systems, reinforced floor areas, supplemental air-conditioning systems or other
Alterations designated by Landlord for removal by Tenant (collectively,
"Specialty Alterations") (all Specialty Alterations shall be deemed to be "Above
Building Standard Installations" for all purposes of this Lease). Without
limiting the foregoing, if together with the submission of plans and
specifications, Tenant provides Landlord with a notice expressly stating that
Landlord should identify all Specialty Alterations while reviewing said plans
and specifications, then Landlord will designate which Alterations will
constitute Specialty Alterations in connection with its approval of the plans
and specifications. At least 30 days prior to commencing the removal of any
Specialty Alterations or the closing of any slab penetrations, Tenant shall
notify Landlord of its intention to remove such Specialty Alterations or effect
such closings, and if Landlord notifies Tenant within such 30 day period, then
Tenant shall not remove such Specialty Alterations or close such slab
penetrations. All Specialty Alterations not so removed shall become the property
of Landlord upon the Expiration Date or sooner termination of the Term. Tenant
shall repair and restore, at its sole cost and expense, in a good and
workmanlike manner, any damage to the Premises or the Building resulting from or
caused by Tenant's removal of any Alterations or Tenant's Property, or by the
closing of any slab penetrations, and if Tenant fails to do so, Tenant shall
reimburse Landlord, on demand, for Landlord's cost of repairing and restoring
such damage. Any Above Building Standard Installations or Tenant's Property not
removed on or before the Expiration Date or sooner termination of the Term shall
be deemed abandoned and Landlord may either retain the same as Landlord's
property or remove and dispose of same, and repair and restore any damage caused
thereby, at Tenant's cost and without liability to or recourse by Tenant or
anyone claiming by, through or under Tenant.
Section 5.4 MECHANIC'S LIENS. Tenant, at its expense, shall discharge
any lien or charge filed against the Premises and/or the Real Property, which
liens or charges may arise out of or result from any work claimed or determined
in good faith by Landlord to have been done by or on behalf of, or materials
claimed or determined in good faith by Landlord to have been furnished to,
Tenant, within not more than 20 days after Tenant's receipt of notice thereof,
by payment, filing the bond required by law or otherwise in accordance with law.
Section 5.5 LABOR RELATIONS. Tenant shall not employ, or permit the
employment of, any contractor or laborer, or permit any materials to be
delivered to or used in the Building, if, in Landlord's sole judgment, such
employment, delivery or use will interfere or cause any conflict or disharmony
with other contractors or laborers engaged in the construction, maintenance or
operation of the Building or the Center by Landlord, Tenant or others, or the
use and enjoyment of the Building or the Center by other tenants or occupants.
In the event of such interference, conflict or disharmony, upon Landlord's
request,
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Tenant shall cause all contractors or laborers causing such interference or
conflict to leave the Building immediately.
Section 5.6 TENANT'S COSTS. Tenant shall pay to Landlord or its
designee, within 10 days after demand, all out-of-pocket costs actually incurred
by Landlord in connection with Tenant's Alterations (including the Initial
Installations), including costs incurred in connection with (i) Landlord's
review of the Alterations (including review of requests for approval thereof),
and (ii) the provision of Building personnel during the performance of any
Alterations required by trade union policy or otherwise, to operate elevators or
otherwise to facilitate Tenant's Alterations.
Section 5.7 TENANT'S EQUIPMENT. Tenant shall not move any heavy
machinery, heavy equipment, freight, bulky matter or fixtures into or out of the
Building without Landlord's prior consent and payment to Landlord of Landlord's
reasonable charges in connection therewith. If any such machinery, equipment or
other items require special handling, Tenant agrees (i) to employ only persons
holding a Master Rigger's License to perform such work, and (ii) such work shall
be done only during hours designated by Landlord.
Section 5.8 LEGAL COMPLIANCE. The approval of plans or specifications,
or the consent by Landlord to the making of any Alterations, does not constitute
Landlord's agreement or representation that such plans, specifications or
Alterations comply with any Requirements or the certificate of occupancy issued
for the Building. Landlord shall have no liability to Tenant or any other party
in connection with Landlord's approval of plans and specifications for any
Alterations, or Landlord's consent to Tenant's performing any Alterations. If,
as the result of any Alterations made by or on behalf of Tenant, Landlord is
required to make any alterations or improvements to any part of the Building in
order to comply with any Requirements, whether or not in the Premises, Tenant
shall pay all costs and expenses incurred by Landlord in connection with such
alterations or improvements as provided in Article 21.
ARTICLE 6
FLOOR LOAD
Tenant shall not place a load upon any floor of the Premises that
exceeds 50 pounds per square foot. Landlord reserves the right to reasonably
designate the position of all heavy machinery, equipment and fixtures which
Tenant wishes to place within the Premises, and to place limitations on the
weight thereof, in accordance with the Rules and Regulations.
ARTICLE 7
REPAIRS
Section 7.1 LANDLORD'S REPAIR AND MAINTENANCE. Landlord shall operate,
maintain and, except as provided in Section 7.2 hereof, make all necessary
repairs (both structural and nonstructural) to (i) the Building Systems, (ii)
the public portions of the Building (excepting, with respect to the Premises,
glass and glass windows and doors, and the so-called store front), and (iii) the
structural elements of the Building, both exterior and interior, including the
roof, foundation and curtain wall, in conformance with standards applicable to
first-class office buildings of comparable age and quality in midtown Manhattan,
subject however to the provisions of Article 14 and Article 15.
Section 7.2 TENANT'S REPAIR AND MAINTENANCE. Tenant shall, at its
expense and in compliance with the requirements of this Lease, including Article
5, (i) keep neat and clean and in good order, condition and repair, the Premises
and every part thereof, including, the store front and the exterior and interior
portions of all doors, windows, plate glass, all plumbing and sewage facilities
within and exclusively serving the Premises, fixtures, interior walls, floors,
ceilings, signs, and all wiring, electrical systems, HVAC systems and equipment,
and similar equipment exclusively serving the Premises, and (ii) make all
nonstructural repairs to the Premises and the fixtures, equipment and
appurtenances therein as and when needed to preserve the Premises in good
working order, condition and repair, except for
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damage for which Tenant is not responsible pursuant to the provisions of Article
14 and Article 15. Tenant shall, at Tenant's expense, repaint and refurbish the
Premises and any part or portion thereof, from time to time, to assure that the
same are kept in a first-class, tenantable and attractive condition throughout
the Term. The Premises shall be kept in a clean, sanitary and safe condition, in
accordance with all applicable Requirements. The Tenant shall not permit or
commit any waste. Without limiting the foregoing, all damage to the Premises or
to any other part of the Building or the Center, or to any fixtures, equipment,
sprinkler system and/or appurtenances thereof, whether requiring structural or
nonstructural repairs, caused by or resulting from any act, omission, neglect or
improper conduct of any Tenant Party, or Alterations made by any Tenant Party,
or the moving of Tenant's fixtures, furniture or equipment, including machinery
and heavy equipment, into, within or out of the Premises, shall be repaired at
Tenant's expense. Such repairs shall be made by (A) Tenant, at Tenant's expense
if the required repairs are nonstructural in nature and do not affect any
Building System or any portion of the Building outside of the Premises, or (B)
Landlord, at Tenant's expense, if the required repairs are structural in nature,
involve replacement of exterior window glass or affect any Building System or
any portion of the Building outside of the Premises. If such repairs are made by
Landlord, Tenant shall reimburse Landlord for all costs and expenses incurred by
Landlord promptly after demand therefore. Tenant shall give Landlord prompt
notice of any defective condition of which Tenant is aware in any structural
element or any Building System located in, servicing or passing through the
Premises. All repairs made by Tenant shall be performed in a good and
first-class workmanlike manner, shall be of a quality at least equal to the
original work or construction using new construction materials, and shall be
made in accordance with this Lease, including Article 5. If Tenant fails to
proceed with due diligence to make any repairs required to be made by Tenant,
Landlord may make such repairs, and all costs and expenses incurred by Landlord
in connection therewith shall be paid by Tenant as provided in Article 21.
Section 7.3 INTERRUPTIONS DUE TO REPAIRS. Landlord reserves the right to
make all changes, alterations, additions, improvements, repairs or replacements
to the Building and/or the Center, or any parts thereof, including to the
Building Systems which provide services to Tenant, all as Landlord deems
necessary or desirable. Landlord shall use reasonable efforts to minimize
interference with Tenant's use and occupancy of the Premises during the making
of such changes, alterations, additions, improvements, repairs or replacements,
provided that Landlord shall have no obligation to employ contractors or labor
at overtime or other premium pay rates, or to incur any other overtime costs or
additional expenses whatsoever. There shall be no Rent abatement or allowance to
Tenant for a diminution of rental value, no actual or constructive eviction of
Tenant, in whole or in part, no relief from any of Tenant's other obligations
under this Lease, and no liability on the part of Landlord, by reason of
inconvenience, annoyance or injury to business arising from Landlord, Tenant or
others making, or failing to make, any repairs, alterations, additions or
improvements in or to any portion of the Center, the Building or the Premises,
or in or to fixtures, appurtenances or equipment therein.
ARTICLE 8
INCREASES IN REAL ESTATE TAXES AND OPERATING EXPENSES
Section 8.1 DEFINITIONS. As used in this Article:
(a) "BASE EXPENSE FACTOR" means the quotient, expressed in
dollars and cents, of (i) the Operating Expenses payable for the Base Operating
Year, divided by (ii) the Center Operating Area for the Base Operating Year.
(b) "BASE TAX FACTOR" means the quotient, expressed in dollars
and cents, of (i) the Taxes payable for the Base Tax Year, divided by (ii) the
Center Tax Area for the Base Tax Year.
(c) "CENTER OPERATING AREA" means the number of square feet in
the rentable area of the Center which is operated and maintained by Landlord or
an Affiliate of Landlord or at the expense of Landlord or an Affiliate of
Landlord. Notwithstanding the foregoing, Landlord may elect, in its sole
discretion from time to time, to:
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(i) subtract from the Center Operating Area the number of
square feet in the rentable area of the Center operated
and maintained by Landlord or an Affiliate of Landlord
but (A) operated and maintained at the expense of any
Person other than Landlord (or an Affiliate of Landlord)
or (B) owned, as a condominium unit or otherwise, by any
Person other than Landlord;
(ii) add to the Center Operating Area to include the number
of square feet in the additional rentable area of the
Center operated and maintained by Landlord or an
Affiliate of Landlord or at the expense of Landlord or
an Affiliate of Landlord; or
(iii) limit the Center Operating Area to the number of square
feet in the rentable area of the Building.
(d) "CENTER TAX AREA" means the number of square feet in the rentable
area of the Center for which Taxes are payable by Landlord or an Affiliate of
Landlord, excluding the rentable area of the Center for which Taxes are not
payable. Notwithstanding the foregoing, Landlord may elect, in its sole
discretion from time to time, to:
(i) subtract from the Center Tax Area the number of square
feet in the rentable area of the Center for which Taxes
are not payable by Landlord or an Affiliate of Landlord;
(ii) add to the Center Tax Area to include the number of
square feet in the additional rentable area of the
Center for which Taxes are payable by Landlord or an
Affiliate of Landlord; or
(iii) limit the Center Tax Area to the number of square feet
in the rentable area of the Building.
(e) "COMPUTATION YEAR" means each calendar year in which any
part of the Term occurs and, in the case of a termination of this Lease pursuant
to Article 19, in which any part of the Term would have occurred except for such
termination.
(f) "EXPENSE FACTOR" means the quotient, expressed in dollars
and cents, of (i) the Operating Expenses payable for any Computation Year
subsequent to the Base Operating Year, divided by (ii) the Center Operating Area
for such Computation Year.
(g) "LANDLORD'S STATEMENT" means an instrument or instruments,
prepared by Landlord, containing a comparison of one or both of (i) the Base Tax
Factor and the Tax Factor for any Tax Year, and (ii) the Base Expense Factor and
the Expense Factor for any Computation Year.
(h) "OPERATING EXPENSES" means all the costs and expenses of
every kind and nature (and taxes, if any, thereon) paid or incurred by or on
behalf of Landlord and/or its Affiliates with respect to the ownership,
operation, maintenance, and repair of the Center, including, the costs incurred
for: (i) air conditioning, ventilation, and heating; (ii) interior and exterior
cleaning and rubbish removal, including supervisory fees of Landlord's Agent in
connection therewith (provided that if such services are performed by Landlord's
Agent, such costs shall not be materially in excess of those charged by outside
contractors for similar services in comparable office buildings); (iii) window
washing; (iv) elevators and escalators; (v) hand tools and other movable
equipment; (vi) xxxxxx and matron service; (vii) electricity, gas, oil, steam,
water rates, sewer rents and other utilities; (viii) association fees and dues;
(ix) protection and security services; (x) compliance with any agreement with
any Governmental Authority with respect to the maintenance of the Center or any
part thereof as a landmark; (xi) insurance premiums; (xii) supplies; (xiii)
wages, salaries, disability benefits, pensions, hospitalization, retirement
plans, severance packages and group insurance for employees of Landlord and
Landlord's Agent, up to and including the level of building managers and their
immediate supervisors; (xiv) uniforms and working clothes for such
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employees and the cleaning thereof; (xv) expenses imposed pursuant to any
collective bargaining agreement with respect to such employees; (xvi) payroll,
social security, unemployment and other similar taxes with respect to such
employees; (xvii) sales, use and similar taxes; (xviii) vault charges; (xix)
franchise and license fees; (xx) charges of independent contractors performing
work in connection with the operation, maintenance and repair of the Center;
(xxi) legal, accounting and other professional fees of Landlord and Landlord's
Agent; (xxii) installation, operation and maintenance of the Christmas tree for
the Center and related holiday decorations, events open to the public and other
promotional expenses intended to enhance the environment of the Center; (xxiii)
landscaping costs; (xxiv) management fees, or if no management fee is being
charged, an imputed management fee not in excess of the amount that would be
paid to a property manager for managing a comparable first class office building
in midtown Manhattan; (xxv) the annual depreciation or amortization, on a
straight-line basis over such period as Landlord shall reasonably determine
(with interest on the unamortized portion at the Base Rate plus 2% per annum),
of any capital costs incurred after the Base Operating Year for any equipment,
device or other improvement made or acquired which is either (A) intended as a
labor-saving measure or to effect other economies in the operation, maintenance
or repair of the Center (but only to the extent that the annual benefits
anticipated to be realized therefrom are reasonably related to the annual
amounts to be amortized), or (B) required by any Requirement. Operating Expenses
shall not include (1) Taxes, special assessments and franchise, income or any
other taxes imposed upon or measured by the income or profits of Landlord; (2)
except for depreciation and amortization specifically included in Operating
Expenses as provided above, the costs of all items which should be capitalized
in accordance with generally accepted accounting practices; (3) the costs of all
services furnished to any other tenant of the Center on a "rent inclusion" basis
which are not provided to Tenant on such basis; (4) the costs of all work or
services performed for any tenant in the Center (including Tenant) at such
tenant's cost and expense; (5) mortgage amortization and interest; (6) leasing
commissions; (7) allowances, concessions and other costs of tenant installations
and decorations incurred in connection with preparing space for any tenant in
the Center, including work letters and concessions; (8) fixed rent payable under
Superior Leases, if any; (9) wages, salaries and benefits paid to any employees
of Landlord and Landlord's Agent, above the level of the immediate supervisors
of building managers; (10) legal and accounting fees relating to (i) disputes
with tenants, prospective tenants or other occupants of the Center, (ii)
disputes with purchasers, prospective purchasers, mortgagees or prospective
mortgagees of the Center or any part thereof, (iii) negotiations of leases,
contracts of sale or mortgages, or (iv) disputes with ground lessors under
Superior Leases, if any; (11) costs which are reimbursed by insurance, warranty
or condemnation proceeds, or which are reimbursable by Tenant or other tenants
or any other Person other than pursuant to an expense escalation clause; (12)
costs in the nature of penalties or fines; (13) the costs of all services,
supplies and repairs paid to any Affiliate or subsidiary of Landlord or
Landlord's Agent materially in excess of the costs that would be payable in an
"arm's length" or unrelated situation; (14) advertising expenses in connection
with leasing of the Center; (15) the costs of installing, operating and
maintaining a specialty improvement, such as a cafeteria, lodging or private
dining facility, unless Tenant is permitted to make use of any such facility
without additional cost or on a subsidized basis consistent with other users;
(16) the costs or expenses (including fines, interest, penalties and legal fees)
arising out of Landlord's failure to timely pay Operating Expenses or Taxes;
(17) the costs incurred in connection with the removal, encapsulation or other
treatment of any Hazardous Materials classified as such and existing in the
Premises as of the date hereof and required to be removed, encapsulated or
treated under applicable Requirements in effect as of the date hereof; (18) the
costs of acquiring works of fine art (as distinguished from the works of art and
sculpture presently located at the Center and replacements, repairs and
alterations thereto) located within the Center; (19) the annual depreciation or
amortization of any capital costs incurred for any equipment, device or other
improvement made or acquired to remedy violations of any Requirements which
exist on the date hereof of which violations Landlord has received written
notice prior to the date of this Lease; and (20) charitable and political
contributions.
Landlord shall not recover under this Section 8.1 any item of cost more
than once.
(i) "TAXES" means all taxes and assessments from time to time imposed
upon the Center or any part thereof, including assessments made as a result of
the Center or any part thereof being within a business improvement district,
other than any interest or penalties imposed in connection therewith, and all
expenses, including fees and disbursements of counsel and experts, reasonably
incurred by Landlord
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in connection with any application for a reduction in the assessed valuation for
the Center or for a judicial review thereof (but in no event shall such expenses
be included in Taxes payable for the Base Tax Year). If due to a future change
in the method of taxation any franchise, income, profit or other tax shall be
levied in substitution in whole or in part for or in lieu of any tax which would
otherwise constitute a Tax, or in addition thereto, such franchise, income,
profit or other tax shall be deemed to be a Tax for the purposes of this Lease
and Tenant shall be obligated to pay its share thereof in accordance with the
provisions of this Lease.
(j) "TAX FACTOR" means the quotient, expressed in dollars and cents, of
(i) the Taxes payable for any Computation Year subsequent to the Base Tax Year,
divided by (ii) the Center Tax Area for such Computation Year.
(k) "TAX YEAR" means the 12 month period commencing July 1 of each year,
or such other 12 month period as may be duly adopted as the fiscal year for real
estate tax purposes by the City of New York.
Section 8.2 TAX PAYMENTS. (a) If the Tax Factor for any Computation Year
exceeds the Base Tax Factor, Tenant shall pay to Landlord, as Additional Rent
during each Computation Year, an amount ("Tenant's Tax Payment") equal to (i)
Tenant's Area, multiplied by (ii) the amount by which the Tax Factor for such
Computation Year exceeds the Base Tax Factor.
Landlord may furnish to Tenant, prior to the commencement of each
Computation Year, a Landlord's Statement setting forth Landlord's estimate of
Tenant's Tax Payment for such Computation Year. If Landlord furnishes an
estimate of Tenant's Tax Payment prior to the commencement of a Computation
Year, then Tenant shall pay to Landlord on the first day of each month during
such Computation Year, an amount equal to 1/12th of Landlord's estimate of
Tenant's Tax Payment for such Computation Year. If Landlord shall not furnish
any such estimate for a Computation Year prior to the commencement thereof, then
(x) 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 8.2(a) for the last month of the preceding Computation Year; (y)
after such estimate is furnished to Tenant, if the payments previously made by
Tenant on account of Tenant's Tax Payment for such Computation Year were greater
or less than the installments of Tenant's Tax Payment to be made in accordance
with such estimate, then (1) if there is a deficiency, Tenant shall pay the
amount thereof to Landlord within 10 Business Days after such estimate is
furnished to Tenant, or (2) if there has been an overpayment by Tenant, then
Landlord shall credit such overpayment against subsequent installments of
payments on account of Rent due hereunder, however, if said estimate is received
by Tenant after the expiration or termination of the Term, then Landlord shall
refund such overpayment to Tenant promptly thereafter; and (z) on the first day
of the month following the month in which such estimate is furnished to Tenant
and monthly thereafter throughout such Computation Year, Tenant shall pay to
Landlord an amount equal to 1/12th of Tenant's Tax Payment shown on such
estimate. Landlord may elect, but shall no obligation to, during each
Computation Year, furnish to Tenant a revised Landlord's Statement of Landlord's
estimate of Tenant's Tax Payment for such Computation Year, and in such case,
Tenant's Tax Payment for such Computation Year shall be adjusted and any
deficiencies paid or overpayments credited, as the case may be, substantially in
the same manner as provided in the preceding sentence.
After the end of each Computation Year, Landlord shall furnish to Tenant
a Landlord's Statement of Taxes for such Computation Year, and (A) if such
Landlord's Statement shall show that the sums so paid by Tenant were less than
Tenant's Tax Payment for such Computation Year, then Tenant shall pay to
Landlord the amount of such deficiency in Tenant's Tax Payment within 10
Business Days after such Landlord's Statement is furnished to Tenant, or (B) if
such Landlord's Statement shall show that the sums so paid by Tenant were more
than Tenant's Tax Payment for such Computation Year, Landlord shall credit such
overpayment in Tenant's Tax Payment against subsequent installments of Rent
payable by Tenant, however, if said Landlord's Statement is received by Tenant
after the expiration or termination of the Term, then Landlord shall refund such
overpayment to Tenant promptly thereafter. If there shall be any increase in the
Taxes for any Computation Year, whether during or after such Computation Year,
or if
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there shall be any decrease in the Taxes for any Computation Year, Tenant's Tax
Payment for such Computation Year shall be appropriately adjusted and any
deficiencies paid or overpayments credited, as the case may be, substantially in
the same manner as provided in the preceding sentence.
(b) Tenant shall be obligated to pay Tenant's Tax Payment regardless of
whether Tenant may be exempt from the payment of taxes as the result of any
reduction, abatement, or exemption from Taxes granted or agreed to by any
Governmental Authority, or by reason of Tenant's diplomatic status or other tax
exempt status. The benefit of any discount for any early payment of Taxes shall
accrue solely to the benefit of Landlord.
(c) Tenant shall not (and hereby waives any and all rights it may now or
hereafter have to) institute or maintain any action, proceeding or application
in any court or other body having the power to fix or review assessed
valuations, for the purpose of reducing Taxes. Without limitation, the filing of
any such proceeding by Tenant without Landlord's prior consent in each instance
shall be a default hereunder.
(d) Tenant shall pay, prior to the due date thereof, all occupancy or
rent taxes now in effect or hereafter enacted and applicable to Tenant's
occupancy of the Premises, regardless of whether imposed by its terms upon
Landlord or Tenant, and if any such tax is payable by Landlord, Tenant shall
promptly reimburse the amount thereof to Landlord upon demand, as Additional
Rent. Tenant shall pay all taxes assessed or imposed upon personal property,
fixtures and equipment within the Premises prior to the due date thereof. Tenant
shall also pay all license fees and other charges which may be imposed upon the
business of Tenant conducted upon the Premises.
Section 8.3 OPERATING EXPENSE PAYMENTS. (a) If the Expense Factor for
any Computation Year exceeds the Base Expense Factor, Tenant shall pay to
Landlord, as Additional Rent during each Computation Year, an amount ("Tenant's
Operating Payment") equal to (i) Tenant's Area, multiplied by (ii) the amount by
which the Expense Factor for such Computation Year exceeds the Base Expense
Factor.
For each Computation Year, Landlord shall furnish to Tenant a statement
setting forth Landlord's good faith estimate of Tenant's Operating Payment for
such Computation Year. If Landlord furnishes an estimate of Tenant's Operating
Payment prior to the commencement of a Computation Year, then Tenant shall pay
to Landlord, on the first day of each month during such Computation Year, an
amount equal to 1/12th of Landlord's estimate of Tenant's Operating Payment for
such Computation Year. If Landlord does not furnish any such estimate for a
Computation Year until after 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 8.3
(a) during the last month of the preceding Computation Year, (B) promptly after
such estimate is furnished to Tenant or together therewith, Landlord shall give
notice to Tenant stating whether the payments previously made by Tenant on
account of Tenant's Operating Payment for such Computation Year were greater or
less than the installments of Tenant's Operating Payment to be made for such
Computation Year in accordance with such estimate, and (1) if there shall be a
deficiency, Tenant shall pay the amount thereof within 10 Business Days after
receipt of such notice, or (2) if there shall have been an overpayment, Landlord
shall credit the amount thereof against subsequent installments of payments on
account of Rent due hereunder, however, if said estimate is received by Tenant
after the expiration or termination of the Term, then Landlord shall refund such
overpayment to Tenant promptly thereafter, and (C) on the first day of the month
following the month in which such estimate is furnished to Tenant, and on the
first day of each month thereafter throughout the remainder of such Computation
Year, Tenant shall pay to Landlord an amount equal to 1/12th of Tenant's
Operating Payment shown on such estimate.
(b) After the end of each Computation Year, Landlord shall furnish to
Tenant a Landlord's Statement of Tenant's Operating Payment for such Computation
Year. If Landlord's Statement shows that the sums paid by Tenant exceeded the
actual amount of Tenant's Operating Payment for such Computation Year, then
Landlord shall credit the amount of such excess against subsequent installments
of Rent due hereunder, however, if said Landlord's Statement is received by
Tenant after the expiration or
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earlier termination of the Term, then Landlord shall refund such excess to
Tenant promptly thereafter. If Landlord's Statement shows that the sums paid by
Tenant were less than Tenant's Operating Payment for such Computation Year, then
Tenant shall pay the amount of such deficiency within 10 Business Days after
Tenant's receipt of Landlord's Statement.
Section 8.4 CERTAIN ADJUSTMENTS. (a) If the Center Operating Area is
increased or decreased, from time to time, pursuant to Section 8.1(c), then from
and after the date of such increase or decrease, Operating Expenses for purposes
of this Lease shall be those Operating Expenses of the Center which are properly
allocable, in Landlord's reasonable judgment, to the space included in the
Center Operating Area, as so increased or decreased. Such allocation shall be
performed by Landlord in good faith in a manner consistent with the methods and
principles employed by Landlord in computing Operating Expenses prior to the
date of such increase or decrease. If Landlord performs such an allocation, then
Landlord shall, in its reasonable discretion, equitably adjust the calculation
of the amount of Operating Expenses for the Base Operating Year to account for
such increase or decrease.
(b) Taxes shall not include any taxes and assessments imposed upon any
portion of the Center excluded from the calculation of the Center Tax Area
pursuant to Section 8.1(d) above. If Landlord has elected to limit the Center
Tax Area to the number of square feet in the rentable area of the Building
pursuant to Section 8.1(d)(iii), then Taxes for purposes of this Lease shall be
calculated as follows: (i) if the Building is separately assessed for tax
purposes, the Taxes imposed shall be the Taxes imposed on the Building; or (ii)
if the Building is not separately assessed then Taxes shall be, as determined by
Landlord, either (x) a portion of the Taxes imposed upon the Center, determined
in the same proportion that the rentable area of the Building bears to the
aggregate rentable area in all buildings in the Center, or (y) a portion of the
Taxes imposed upon the tax lot on which the Building is located, determined in
the same proportion that the rentable area of the Building bears to the
aggregate rentable area in all buildings located on such tax lot.
(c) If the Rent Commencement Date shall be a day other than January 1 or
the Expiration Date shall be a day other than December 31, or if there is any
abatement of Fixed Rent payable under this Lease (other than any abatement under
Article 1 hereof) or any termination of this Lease (other than a termination
pursuant to Article 19), or if there is any increase or decrease in Tenant's
Area, or if there is any increase or decrease in the Center Operating Area or
the Center Tax Area, then in each such event, in applying the provisions of this
Article with respect to the Tax Year or Computation Year in which the event
occurred, appropriate adjustments shall be made to reflect the result of such
event on a basis consistent with the principles underlying the provisions of
this Article, taking into consideration (i) the portion of such Tax Year or
Computation Year, as the case may be, which shall have elapsed prior to or after
such event, (ii) the rentable area of the Premises or the Center Operating Area
or the Center Tax Area affected thereby, and (iii) the duration of such event.
(d) If during all or any part of any Computation Year (including the
Base Operating Year) Landlord is not furnishing any particular work or service
(the cost of which, if performed by Landlord, would constitute an Operating
Expense) to a rentable portion of the Center which is not then leased, then
Operating Expenses for such period shall include an amount equal to the costs
and expenses which would have been incurred by Landlord and/or its Affiliates
for such work or service during such period (as determined by Landlord in its
good faith) if the Center had been 95% leased and occupied.
(e) If during all or any part of any Computation Year (including the
Base Operating Year) Landlord is not obligated to furnish any particular work or
service (the cost of which, if performed by Landlord, would constitute an
Operating Expense) to any portion of the Center (other than to space not then
leased), then notwithstanding anything to the contrary set forth in Section
8.1(h), the amount included in Operating Expenses for such period with respect
to such work or service shall be equal to the product of (i) the Center
Operating Area multiplied by (ii) the quotient expressed in dollars and cents,
of (A) the costs and expenses actually incurred by Landlord during such period
to furnish such work or service, divided by (B) the area of the Center to which
Landlord provides such work or service. Without limiting the provisions of
Section 8.1(h), if subsequent to the Base Operating Year, Landlord commences
furnishing any particular type or category of work or service which is not
furnished in the Base Operating
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Year, the cost of which is included in Operating Expenses, then Landlord shall,
in its reasonable discretion equitably adjust the calculation of Operating
Expenses for the Base Operating Year to account for such additional type or
category of work or service.
Section 8.5 NON-WAIVER. Landlord's failure to render a Landlord's
Statement on a timely basis with respect to any Computation Year shall not
prejudice Landlord's right to thereafter render a Landlord's Statement with
respect to such Computation Year or any subsequent Computation Year, nor shall
the rendering of a Landlord's Statement prejudice Landlord's right to thereafter
render a corrected Landlord's Statement for any Computation Year.
Section 8.6 TENANT DISPUTES. Each Landlord's Statement sent to Tenant
shall be conclusively binding upon Tenant unless Tenant shall (i) within 30 days
after such statement is sent, pay to Landlord the amount set forth in such
statement, without prejudice to Tenant's right to dispute such statement, and
(ii) within 90 days after such statement is sent, send a notice to Landlord
objecting to such statement and specifying the reasons for Tenant's claim that
such statement is incorrect. In no event shall Tenant withhold payment of any
portion of amounts set forth in a Landlord's statement. Tenant covenants and
agrees that Tenant will not employ, in connection with any dispute under this
Lease, any Person who is to be compensated, in whole or in part, on a
contingency fee basis. If the parties are unable to resolve any such dispute
within 30 days following the giving of Tenant's notice of objection, either
party may refer the issues raised to an independent firm of certified public
accountants selected by Landlord and reasonably acceptable to Tenant, and the
decision of such accountants shall be conclusively binding upon Landlord and
Tenant. In connection therewith, Tenant and such accountants shall execute and
deliver to Landlord a confidentiality agreement, in form and substance
reasonably satisfactory to Landlord, whereby such parties agree not to disclose
to any third party any of the information obtained in connection with such
review, or the substance of any admissions or stipulations by any party in
connection therewith, or of any resulting reconciliation, compromise or
settlement. Tenant shall pay the fees and expenses relating to such procedure,
unless such accountants shall determine that Landlord overstated the Expense
Factor by more than 5% for such Computation Year, as finally determined, in
which case Landlord shall pay such fees and expenses.
ARTICLE 9
REQUIREMENTS OF LAW
Section 9.1 (a) TENANT'S COMPLIANCE. Tenant, at its expense, shall
comply (or cause to be complied) with all Requirements applicable to the
Premises, regardless of whether imposed by their terms upon Landlord or Tenant.
If Tenant obtains knowledge of any failure to comply with any Requirements
applicable to the Premises, Tenant shall give Landlord prompt notice thereof.
All repairs and alterations, whether ordinary or extraordinary, required to be
made to cause the Premises (which shall include all means of access and egress
to, from and between the floors comprising parts of the Premises) to comply with
any Requirements shall be made at Tenant's expense. If such repairs or
alterations are nonstructural, do not affect any Building System, and do not
involve the performance of work outside of the Premises, then they shall be made
by Tenant, in accordance with the requirements of this Lease, including Article
5. If such repairs or alterations are structural, affect any Building System, or
involve the performance of work outside the Premises, then at Landlord's option,
they shall be made by Landlord and, within 10 days after demand therefore,
Tenant shall reimburse Landlord for all costs and expenses incurred by Landlord
in connection therewith. Notwithstanding anything to the contrary contained
herein, Tenant agrees that within the Premises (which shall include all means of
access and egress to, from and between the floors comprising parts of the
Premises), it shall be responsible for compliance with the Americans With
Disabilities Act (42 U.S.C. Section 12101 et seq.) and the regulations and
Accessibility Guidelines for Buildings and Facilities issued pursuant thereto.
(b) HAZARDOUS MATERIALS. Tenant shall not (i) cause or permit
any Hazardous Materials to be brought into or onto the Center, (ii) cause or
permit the storage, handling, or use of Hazardous Materials in any manner not
permitted by any Requirements, or (iii) cause or permit the escape, disposal or
release of any Hazardous Materials within or in the vicinity of the Center.
Nothing
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herein shall be deemed to prevent Tenant's use of commercially available
cleansers which may contain Hazardous Materials; provided that (i) such
cleansers are ordinarily and customarily used in the operation of health club
facilities, and (ii) any such use is in accordance with all Requirements. Tenant
shall be responsible, at its expense, for all matters directly or indirectly
based on, or arising or resulting from, the actual or alleged presence of
Hazardous Materials in the Premises, the Building or the Center which arises out
of or results from Tenant, Tenant's use of the Premises, those acting on behalf
of Tenant or any Tenant Party. Tenant shall provide to Landlord copies of all
communications received by Tenant with respect to any Requirements relating to
Hazardous Materials, and any claims made in connection therewith. Landlord or
its agents may perform environmental inspections of the Premises at any time.
Without limitation, Tenant agrees (A) to notify Landlord immediately of any
contamination, claim of contamination, loss or damage in connection with
Hazardous Materials, (B) after consultation with and approval by Landlord, to
clean up the contamination in full compliance with applicable Requirements, and
(C) to indemnify, defend and hold Landlord harmless from and against any claims,
suits, causes of action, costs and fees, including attorneys' fees, arising out
of or resulting from any such contamination, claim of contamination, loss or
damage. No consent or approval of Landlord shall in any way be construed as
imposing upon Landlord any liability for the means, methods or manner of
removal, containment or other compliance with applicable Requirements.
(c) LANDLORD'S INSURANCE. Tenant shall not cause or permit any action or
condition that would (i) invalidate or conflict with Landlord's insurance
policies, (ii) violate applicable rules, regulations and guidelines of the Fire
Department, Fire Insurance Rating Organization or any other authority having
jurisdiction over the Center, (iii) cause an increase in the premiums for any
insurance then covering the Building over that payable with respect to
comparable first-class office buildings, or (iv) result in insurance companies
of good standing refusing to insure the Building or any property therein in
amounts and against risks as reasonably determined by Landlord. If any insurance
premiums increase as a result of Tenant's failure to comply with the provisions
of this Article, then Tenant shall promptly cure such failure and shall
reimburse Landlord for the increased insurance premiums paid by Landlord as a
result of such failure by Tenant. In any action or proceeding to which Landlord
and Tenant are parties, a schedule or "make up" of rates for the Building or the
Premises issued by the appropriate Fire Insurance Rating Organization, or other
body fixing such insurance rates, shall be conclusive evidence of the insurance
rates then applicable to the Building.
Section 9.2 FIRE ALARM SYSTEM: SPRINKLERS. Tenant shall install, and
thereafter maintain in good order and repair, a sprinkler system and fire-alarm
and life-safety system serving the Premises. Such installation and maintenance
shall be performed by Tenant in accordance with this Lease, the Rules and
Regulations and all Requirements. If the Fire Insurance Rating Organization or
any Governmental Authority or any of Landlord's insurers requires or recommends
any modifications or Alterations be made or any additional equipment be supplied
in connection with the sprinkler system or fire-alarm and life-safety system
serving the Building or the Premises by reason of Tenant's business, or the
location of the equipment, trade fixtures, or other contents of the Premises,
Landlord (to the extent such modifications or Alterations are structural, affect
any Building System or involve the performance of work outside the Premises), or
Tenant (to the extent such modifications or Alterations are nonstructural, do
not affect any Building System and do not involve the performance of work
outside the Premises) shall make such modifications or Alterations, and supply
such additional equipment, in either case at Tenant's expense.
Section 9.3 LIMITATIONS ON RENT. If at any time during the Term, the
Rent is not fully collectible by reason of any Requirement, Tenant shall take
such other steps as Landlord may request, and as may be legally permissible, to
permit Landlord to collect the maximum rents which may during the continuance of
such restriction be legally permissible (but not in excess of the Rent reserved
under this Lease). Upon the termination of such restriction during the Term,
Tenant shall pay to Landlord, in addition to the Rent for the period following
such termination, if legally permissible, the portion of Rent which would have
been paid pursuant to this Lease but for such legal restriction, less the Rent
paid by Tenant to Landlord while such restriction was in effect, together with
interest thereon at the Base Rate.
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ARTICLE 10
QUIET ENJOYMENT
Provided this Lease is in full force and effect and no Event of Default
then exists, Tenant may peaceably and quietly enjoy the Premises without
hindrance by Landlord or any Person lawfully claiming through or under Landlord,
subject to the terms and conditions of this Lease and all Superior Leases and
Mortgages.
ARTICLE 11
SUBORDINATION
Section 11.1 SUBORDINATION AND ATTORNMENT. (a) This Lease and Tenant's
rights hereunder are subject and subordinate to all Mortgages and Superior
Leases. At the request of any Mortgagee or Lessor, Tenant shall attorn to such
Mortgagee or Lessor, its successors in interest or any purchaser in a
foreclosure sale.
(b) If a Lessor or Mortgagee or any other Person shall succeed to the
rights of Landlord under this Lease, whether through possession or foreclosure
action, or the delivery of a new lease or deed, or otherwise, then at the
request of the successor landlord and upon such successor landlord's written
agreement to accept Tenant's attornment and to recognize Tenant's interest under
this Lease, Tenant shall be deemed to have attornment to and recognized such
successor landlord as Landlord under this Lease. The provisions of this Article
11 are self-operative and require no further instruments to give effect hereto;
provided, however, that Tenant shall promptly execute and deliver any instrument
that such successor landlord may reasonably request (1) evidencing such
attornment, (2) setting forth the terms and conditions of Tenant's tenancy, and
(3) containing such other terms and conditions as may be required by such
Mortgagee or Lessor, provided such terms and conditions do not increase the
Rent, materially increase Tenant's non-Rent obligations or materially and
adversely affect Tenant's rights under this Lease. Upon such attornment, this
Lease shall continue in full force and effect as a direct lease between such
successor landlord and Tenant upon all of the terms, conditions and covenants
set forth in this Lease except that such successor landlord shall not be:
(i) liable for any act or omission of Landlord (except to
the extent such act or omission is a default under this
Lease and continues beyond the date when such successor
landlord succeeds to Landlord's interest and Tenant
gives notice of such act or omission to such successor
landlord);
(ii) subject to any defense, claim, counterclaim, set-off or
offset which Tenant may have against Landlord;
(iii) bound by any prepayment of more than one month's Rent to
any prior landlord;
(iv) bound by any obligation to make any payment to Tenant
which was required to be made prior to the time such
successor landlord succeeded to Landlord's interest,
excepting only the obligation of Landlord to provide
Landlord's Contribution in accordance with the terms of
this Lease;
(v) bound by any obligation to perform any work or to make
improvements to the Premises except for (A) repairs and
maintenance required to be made by the landlord under
this Lease, and (B) repairs to the Premises as a result
of damage by fire or other casualty, or partial
condemnation, pursuant to the provisions of this Lease,
but only to the extent that such repairs can reasonably
be made from the net proceeds of any insurance or
condemnation awards actually made available to such
successor landlord; or
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(vi) bound by any modification, amendment or renewal of this
Lease made without the consent of any Lessor or
Mortgagee of which Tenant has been provided notice.
(c) Any Mortgagee may elect that this Lease shall have priority
over the Mortgage that it holds and, upon notification to Tenant by such
Mortgagee, this Lease shall be deemed to have priority over such Mortgage,
regardless of the date of this Lease. In connection with any financing of the
Real Property or the Center, or of the interest of the lessee under any Superior
Lease, Tenant shall consent to any reasonable modifications of this Lease
requested by any lender, provided such modifications do not increase the Rent,
materially increase Tenant's non-Rent obligations or materially and adversely
affect Tenant's rights under this Lease.
Section 11.2 TERMINATION BY TENANT. As long as any Superior Lease or
Mortgage shall exist, Tenant shall not seek to terminate this Lease by reason of
any act or omission of Landlord (i) until Tenant shall have given notice of such
act or omission to all Lessors and/or Mortgagees, and (ii) until a reasonable
period of time shall have elapsed following the giving of notice of such default
and the expiration of any applicable notice or grace periods (unless such act or
omission is not capable of being remedied within a reasonable period of time)
during which period such Lessors and/or Mortgagees shall have the right, but not
the obligation, to remedy such act or omission. If any Lessor or Mortgagee
elects to remedy such act or omission of Landlord, Tenant shall not seek to
terminate this Lease so long as such Lessor or Mortgagee is proceeding with
reasonable diligence to effect such remedy.
Section 11.3 FUTURE CONDOMINIUM DECLARATION. This Lease and Tenant's
rights hereunder are and will be subject and subordinate to any condominium
declaration, by-laws and other instruments (collectively, the "Declaration")
which may be recorded in order to subject the Building to a condominium form of
ownership pursuant to Article 9-13 of the New York Real Property Law or any
successor statute, provided that the Declaration does not by its terms increase
the Rent, materially increase Tenant's non-Rent obligations or materially and
adversely affect Tenant's rights under this Lease. At Landlord's request, and
subject to the foregoing proviso, Tenant will execute and deliver to Landlord an
amendment of this Lease confirming such subordination and modifying this Lease
to conform to such condominium regime.
Section 11.4 APPLICABILITY. The provisions of this Article shall (i)
inure to the benefit of Landlord, any future owner of the Real Property, any
Lessor or Mortgagee and any sublessor thereof, and (ii) apply notwithstanding
that, as a matter of law, this Lease may terminate upon the termination of any
Superior Lease or the foreclosure of any Mortgage.
Section 11.5 NON-DISTURBANCE AGREEMENTS. As a condition to Tenant's
agreement hereunder to subordinate Tenant's interest in this Lease to any
Mortgage and/or any Superior Lease, Landlord shall obtain from each Mortgagee or
Lessor an agreement, in recordable form and in the standard form customarily
employed by such Mortgagee or Lessor, pursuant to which such Mortgagee or Lessor
shall agree that if and so long as no Event of Default hereunder shall have
occurred and be continuing, the leasehold estate granted to Tenant and the
rights of Tenant pursuant to this Lease to quiet and peaceful possession of the
Premises shall not be terminated, modified, affected or disturbed by any action
which such Mortgagee may take to foreclose any such Mortgage, or which such
Lessor shall take to terminate such Superior Lease, as applicable, and that any
successor landlord shall recognize this Lease as being in full force and effect
as if it were a direct lease between such successor landlord and Tenant upon all
of the terms, covenants, conditions and options granted to Tenant under this
Lease, except as otherwise provided in Section 11.1(b) hereof (any such
agreement, a "Non-Disturbance Agreement").
ARTICLE 12
SERVICES
Section 12.1 ELEVATORS. Landlord shall make available to Tenant at least
one freight elevator serving the Premises upon Tenant's prior request, on a
non-exclusive "first come, first serve" basis with
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other Building tenants, on all Business Days from 8:00 a.m. to 12:00 noon, and
from 1:00 p.m. to 5:00 p.m.
Section 12.2 [Intentionally Deleted]
Section 12.3 CHILLED WATER. For and with respect to the Operating Hours
(as hereinafter defined), Landlord, at Tenant's request, shall provide Tenant
with 95 tons of chilled water (at 6 xxxxx per useable square foot for lighting,
power and heat loads) for the heating, ventilation and air-conditioning ("HVAC")
system to be installed by Tenant, at Tenant's cost and expense, as part of the
Initial Installations. Tenant shall pay Landlord, as additional rent, for all
chilled water provided to Tenant in excess of 95 tons, within 10 days after
rendition of a xxxx therefor, an annual charge at the rate of $750.00 per ton
(the "Chilled Water Charge"). The Chilled Water Charge shall be subject to a
cost of living increase for each year after the first year included within the
Term. In that regard, on the first calendar anniversary of the Commencement Date
(such date and each ensuing anniversary thereof being referred to hereinafter as
a "Chilled Water Adjustment Date"), and on each Chilled Water Adjustment Date
thereafter during the Term, the Chilled Water Charge shall be increased above
the initial Chilled Water Charge in the same proportion as the Consumer Price
Index for all Urban Consumers (CPI-U): New York, New York-Northeastern New
Jersey Average, All Items (unadjusted) (1982-84=100), published monthly by the
U.S. Department of Labor, or if said index ceases to be published, a comparable
index reflecting changes in the cost of living and designated by Landlord (the
"Price Index") has increased, if at all, as of the Chilled Water Adjustment Date
in question above the Price Index as of the Commencement Date, and each such
increased figure shall then become the Tenant's Chilled Water Charge and shall
remain in effect until the next Chilled Water Adjustment Date. In no event shall
anything contained herein permit the Chilled Water Charge to be reduced below
the amount of the initial Chilled Water Charge specified hereinabove. Landlord
shall not be liable to Tenant for any failure or defect in the supply or
character of chilled water supplied to Tenant by reason of any Requirement, or
any act or omission of the public service company serving the Building, or for
any other reason not caused by the gross negligence or willful misconduct of
Landlord, its agents, contractors and employees. In addition to the foregoing
Chilled Water Charge, at the time of the initial hookup by Tenant of any HVAC
equipment and at the time of installation of any supplementary or auxiliary HVAC
equipment to serve the Premises, or if Tenant's requirements for chilled water
require additional connections or enlargements to existing connections to
Landlord's chilled water ducts, Tenant shall pay to Landlord a "tap-in" fee for
each connection equal to the greater of (i) $1,500.00, which rate shall be
increased on each anniversary of the Commencement Date based on the percentage
increase in the Price Index, if any, over that in effect on the immediately
preceding anniversary of the Commencement Date and (ii) the "tap-in" fee which
Landlord shall then have established as customary for the Building. All hookups
and "tap-ins" shall be performed by Landlord, on Tenant's behalf and at Tenant's
expense.
Section 12.4 OVERTIME BUILDING SERVICES. The Rent does not reflect or
include any charge to Tenant for the furnishing of any building services such as
freight elevator service or chilled water other than to the extent expressly and
specifically set forth in Sections 12.1, 12.2 and 12.3 above. Landlord shall not
be required to furnish any building services at any times ("Overtime Periods")
other than the times specifically described in this Lease for the provision of
such building services unless Tenant delivers notice to Landlord's property
management office serving the Building requesting such services, such notice to
be delivered on a Business Day at least 24 hours prior to the time at which such
services are to be provided. If Landlord furnishes elevator service, chilled
water or any other building service to the Premises during Overtime Periods,
Tenant shall pay to Landlord Landlord's then established rates for supplying
such overtime building services in the Building. Landlord shall not be obligated
to furnish any building services to the Premises other than as expressly and
specifically set forth in this Article 12.
Section 12.5 CLEANING. Tenant shall, at its cost and expense, cause the
Premises to be cleaned, substantially in accordance with the standards
established by Landlord from time-to-time. All cleaning contractors employed by
Tenant to perform cleaning services shall be subject to the prior written
approval of Landlord in each instance. In connection therewith, Tenant shall
permit Landlord or its designees (as designated by Landlord, the "Cleaning
Contractor") to perform such services, on Tenant's behalf and at Tenant's
expense, as follows: prior to entering into any contracts for cleaning services,
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Tenant shall forward to Landlord a statement setting forth the name of the
proposed cleaning contractor, the rates and other material terms and conditions
of said cleaning services contract. Landlord shall have the right, exercisable
by written notice given to Tenant within 30 days after receipt of Tenant's
notice, to elect to have the Cleaning Contractor designated by Landlord perform
such cleaning services upon the terms and conditions, and at the rates, set
forth in Tenant's notice. If Landlord timely gives notice of its exercise of
said right to Tenant, then promptly thereafter Tenant and the Cleaning
Contractor shall enter into a contract for provision of cleaning services upon
such terms. If Landlord fails to exercise such rights in a timely fashion, then
Tenant may, within 45 days thereafter, enter into a contract for cleaning
services upon the terms and conditions specified in the notice previously
delivered to Landlord.
Section 12.6 WATER AND STEAM. Landlord will install meters to measure
the water furnished to the Premises. Within 10 days after request therefore,
Tenant shall pay the cost of the installation of said meters, for all
maintenance, repairs and replacements to said meters, and from time to time,
upon receipt of bills from Landlord therefore, all costs and expenses incurred
by Landlord in furnishing water to the Premises, including Landlord's reasonable
charge for any required pumping or heating thereof and any sewer or utility tax,
fee or charge now or hereafter assessed or imposed upon the Premises or the Real
Property pursuant to any Requirement, plus an administrative charge for
Landlord's supervision and overhead equal to 3% of such costs and expenses.
Tenant shall be entitled to use and shall pay for all live steam
consumed in and upon the Premises. Landlord shall, at Tenant's cost and expense,
install meters to measure consumption of steam. Within 10 days after request
therefore, Tenant shall pay the cost of the installation of said meters and for
all maintenance, repairs and replacements to said meters. All payments for steam
shall be made either to Landlord or directly to the public utility corporation
or corporations furnishing live steam to the Building, as Landlord may from time
to time specify. If such payments are to be made to a public utility
corporation, they shall be made as and when due and payable. If such payments
are to be made to Landlord, they shall be at the rate charged to consumers by
the aforesaid public utility corporations, together with Landlord's reasonable
charge for any required pumping thereof, and any tax, fee, or charge now or
hereafter assessed, or imposed upon the Premises or the Real Property pursuant
to any Requirement, plus an administrative charge for Landlord's supervision and
overhead equal to 3% of such amounts. All such payments shall be due as
additional rent within 10 days after bills are rendered by Landlord. Landlord
shall not be liable to Tenant for any failure or defect in the supply or
character of water and/or steam supplied to Tenant by reason of any Requirement,
or any act or omission of the public service company serving the Building, or
for any other reason not caused by the gross negligence or willful misconduct of
Landlord, its agents, contractors and employees. Landlord shall maintain, repair
and replace the meter referred to above at Tenant's expense.
Section 12.7 REFUSE AND RUBBISH REMOVAL. All trash, refuse and rubbish
shall be kept in covered trash receptacles, which trash receptacles shall be
kept within the Premises at all times and in no event stored outside of the
same. In accordance with Landlord's direction, on a daily basis Tenant shall
cause all trash to be removed to a designated area of the loading dock located
at the Building. Tenant shall pay to Landlord within 10 days after request
therefor, Landlord's reasonable charges for removal of refuse and rubbish.
Tenant shall not dispose of any refuse and rubbish in the public areas of the
Center or any part thereof, and if any Tenant Party does so, Tenant shall be
liable for Landlord's reasonable charge for such removal. Tenant shall cause all
Tenant Parties to observe such additional rules and regulations regarding
rubbish removal and/or recycling as Landlord may, from time to time, reasonably
impose.
Section 12.8 LISTING IN BUILDING DIRECTORY. Landlord shall, at the
request of Tenant, maintain a listing on the Center directory in the Building
lobby of the name of Tenant.
Section 12.9 SERVICE INTERRUPTIONS. Landlord reserves the right to
suspend any building service when necessary, by reason of Unavoidable Delays,
accidents or emergencies, or for repairs, alterations or improvements which, in
Landlord's reasonable judgment, are necessary or appropriate, until such
Unavoidable Delay, accident or emergency shall cease or such repairs,
alterations or improvements are completed, and Landlord shall not be liable to
Tenant for any interruption, curtailment or failure to supply
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services. Landlord shall use reasonable efforts to restore such service, remedy
such situation and minimize interference with Tenant's business, provided that
Landlord shall have no obligation to employ contractors or labor at overtime or
other premium pay rates, or to incur any other overtime costs or additional
expenses whatsoever. The exercise of any such right or the occurrence of any
such failure by Landlord shall not (i) constitute an actual or constructive
eviction, in whole or in part, (ii) entitle Tenant to any compensation,
abatement or diminution of Rent, (iii) relieve Tenant from any of its
obligations under this Lease, or (iv) impose any liability upon Landlord by
reason of inconvenience to Tenant, or interruption of Tenant's business, or
otherwise.
Section 12.10 RENT ABATEMENT. Not withstanding anything to the contrary
contained in this Lease, if Tenant is unable to use the entire Premises for the
ordinary conduct of Tenant's business due solely to (a) an interruption of an
Essential Service (as hereinafter defined) resulting from Landlord's performance
of an improvement or repair to the Building or (b) Landlord's breach of an
obligation under this Lease to perform repairs or replacements which results in
Landlord's failure to provide an Essential Service, in each case other than as a
result of Unavoidable Delays, casualty or condemnation, and such condition
continues for a period in excess of 10 consecutive days on which pursuant to
Section 36.2(b) of this Lease Tenant is required to keep the Premises open for
business after (i) Tenant furnishes a notice to Landlord (the "Abatement
Notice") stating that Tenant's inability to use the Premises is solely due to
such condition, (ii) Tenant does not actually use or occupy any portion of the
Premises during such period, and (iii) such condition has not resulted from the
negligence or misconduct of Tenant or any Tenant Party, then Fixed Rent,
Tenant's Tax Payment and Tenant's Operating Payment shall be abated on a per
diem basis for the period commencing on the 11th day after Tenant delivers the
Abatement Notice to Landlord and ending on the earlier of (x) the date Tenant
reoccupies any portion of the Premises, and (y) the date on which such condition
is substantially remedied. "Essential Service" shall mean a service which
Landlord is obligated under this Lease to provide to Tenant which if not
provided shall (1) deny access to the Premises, (2) threaten the health or
safety of any occupants of the Premises or (3) prevent the usage of more than
25% of the Premises for the ordinary conduct of Tenant's business.
ARTICLE 13
INSURANCE, PROPERTY LOSS OR DAMAGE: REIMBURSEMENT
Section 13.1 TENANT'S INSURANCE. (a) Tenant, at its expense, shall
obtain and keep in full force and effect during the Term:
(i) a policy of commercial general liability insurance on an
occurrence basis against claims for personal injury, death and/or
property damage occurring in or about the Premises or the Center, in the
broadest and most comprehensive form then generally available from time
to time, under which Tenant is named as the insured and Landlord,
Landlord's managing agent, any Lessors, any Mortgagees and any other
parties whose names shall have been furnished by Landlord to Tenant from
time to time are named as additional insureds, which insurance shall
provide primary coverage without contribution from any other insurance
carried by or for the benefit of Landlord, Landlord's managing agent or
any Lessors or Mortgagees named as additional insureds, and Tenant
agrees to obtain blanket broad-form contractual liability coverage to
insure its indemnity obligations set forth in Article 32 hereof. The
minimum limits of liability shall be a combined single limit with
respect to each occurrence in an amount of not less than $5,000,000.00
and in an amount of not less than $10,000,000.00 in the aggregate;
provided, however, that Landlord may require Tenant to increase such
coverage, from time to time, to that amount of insurance which in
Landlord's reasonable judgment is then being customarily required by
landlords for similar health-club facilities in first-class buildings in
the City of New York. If the aggregate limit applying to the Premises is
reduced by the payment of a claim or establishment of a reserve equal to
or greater than 50% of the annual aggregate, Tenant shall immediately
arrange to have the aggregate limit restored by endorsement to the
existing policy or the purchase of an additional insurance policy
unless, in Landlord's reasonable judgment, Tenant maintains sufficient
excess liability insurance to satisfy the liability requirements of this
Lease without the reinstatement of the aggregate limit;
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(ii) insurance against loss or damage by fire, and such other
risks and hazards as are insurable under then available standard forms
of "all risk" property insurance policies with extended coverage,
insuring Tenant's Property, and all Alterations and improvements to the
Premises (including the Initial Installations) for the full insurable
value thereof or replacement cost value thereof, having a deductible
amount, if any, as reasonably determined by Landlord;
(iii) during the performance of any Alteration (including the
Initial Installations), until completion thereof, builder's risk
insurance on an "all risk" basis and on a completed value form including
a "permission to complete and occupy endorsement", for full replacement
value covering the interest of Landlord and Tenant (and their respective
contractors and subcontractors), any Mortgagee and any Lessor, in all
work incorporated in the Building and all materials and equipment in or
about the Premises;
(iv) workers' compensation insurance, in amounts and with
coverages as required by law;
(v) business interruption insurance in an amount of not less
than 12 months of the Rent payable under this Lease; and
(vi) such other insurance in such amounts as Landlord, any
Mortgagee and/or any Lessor may reasonably require from time to time.
(b) All insurance required to be carried by Tenant pursuant to the terms
of this Lease (i) shall contain a provision that (A) no act or omission of
Tenant shall affect or limit the obligation of the insurance company to pay the
amount of any loss sustained, (B) the policy shall be noncancellable and/or no
material change in coverage shall be made thereto unless Landlord, Lessors and
Mortgagees shall have received 30 days' prior notice of the same by certified
mail, return receipt requested, and (C) Tenant shall be solely responsible for
the payment of all premiums under such policies and Landlord, Lessors and
Mortgagees shall have no obligation for the payment thereof, and (ii) shall be
effected under valid and enforceable policies issued by reputable and
independent insurers permitted to do business in the State of New York, and
rated in Best's Insurance Guide, or any successor thereto (or if there be none,
an organization having a national reputation) as having a Best's Rating of "A-"
and a "Financial Size Category" of at least "IX" or if such ratings are not then
in effect, the equivalent thereof or such other financial rating as Landlord may
at any time consider appropriate.
(c) On or prior to the Commencement Date, Tenant shall deliver to
Landlord appropriate policies of insurance, including evidence of waivers of
subrogation, required to be carried by Tenant pursuant to this Article. Evidence
of each renewal or replacement of a policy shall be delivered by Tenant to
Landlord at least 10 days prior to the expiration of such policy. In lieu of the
policies of insurance required to be delivered to Landlord pursuant to this
Article 13 (collectively, the "Policies"), Tenant may deliver to Landlord a
certification or certifications from Tenant's insurance company or companies (on
the form currently designated "Accord 27", or the equivalent, rather than on the
form currently designated "Accord 25-S", or the equivalent) which shall be
binding on Tenant's insurance company, and which shall expressly provide that
such certification (i) conveys to Landlord and any other named insured and/or
additional insureds thereunder (the "Insured Parties") all the rights and
privileges afforded under the applicable Policies as primary insurance, and (ii)
contains an unconditional obligation of the insurance company to advise all
Insured Parties in writing by certified mail, return receipt requested, at least
30 days in advance of any termination of or change to the applicable Policies
that would affect the interest of any of the Insured Parties.
Section 13.2 WAIVER OF SUBROGATION. Landlord and Tenant shall each
procure an appropriate clause in or endorsement to any property insurance
covering the Premises, the Building and personal property, fixtures and
equipment located therein, wherein the insurance companies shall waive
subrogation or consent to a waiver of right of recovery, and Landlord and Tenant
agree not to make any claim against, or seek to recover from, the other, for any
loss or damage to its property or the property of
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others resulting from fire and other hazards to the extent covered by such
property insurance; provided, however, that the release, discharge, exoneration
and covenant not to xxx contained herein shall be limited by and coextensive
with the terms and provisions of the waiver of subrogation or waiver of right of
recovery. If the payment of an additional premium is required for the inclusion
of, or consent to, a waiver of subrogation, each party shall advise the other,
in writing, of the amount of any such additional premiums and the other party
may pay such additional premium. If such other party shall not elect to pay such
additional premium, then notwithstanding the foregoing provisions, the first
party shall not be required to obtain such waiver of subrogation or consent to
waiver of right of recovery. Tenant acknowledges that Landlord shall not be
obligated to carry insurance on, and shall not be responsible for, (i) damage to
any Alterations or improvements to the Premises (including the Initial
Installations), (ii) Tenant's Property, and (iii) any loss suffered by Tenant
due to interruption of Tenant's business.
ARTICLE 14
DESTRUCTION - FIRE OR OTHER CAUSE
Section 14.1 RESTORATION. (a) If the Premises are damaged by fire or
other casualty, or if the Building is damaged such that Tenant is deprived of
reasonable access to the Premises, Tenant shall give prompt notice to Landlord,
and Landlord shall repair the core and shell of the Premises and all Building
Systems (or the damaged portion thereof) up to the point of connection to the
Premises, at its expense, to substantially the condition thereof prior to the
damage, subject to the provisions of this Article 14, and of any Mortgage or
Superior Lease. Landlord shall have no obligation to repair or restore, and
Tenant shall at its cost and expense, repair and replace Tenant's Property, and
any Alterations or improvements to the Premises (including the Initial
Installations), to substantially the condition prior to the damage. So long as
Tenant is not in default beyond applicable grace or notice provisions in the
payment or performance of its obligations under this Section 14.1, then until
the restoration of the core and shell of the Premises is Substantially Completed
or would have been Substantially Completed but for Tenant Delay, Fixed Rent,
Tenant's Tax Payment and Tenant's Operating Payment shall be abated or reduced
in the proportion by which the area of the part of the Premises which is not
usable (or accessible) and is not used by Tenant bears to the total area of the
Premises. Nothing set forth in this Section 14.1 shall be interpreted to limit
Landlord's right to repair or restore all or any portion of the Premises at such
time and in such manner as Landlord deems appropriate in Landlord's sole
judgment, and no such repair or restoration shall constitute a waiver by
Landlord of any of Landlord's rights set forth in this Section 14.1 or elsewhere
in this Lease.
Section 14.2 LANDLORD'S TERMINATION RIGHT. Notwithstanding anything to
the contrary contained in Section 14.1, if the Premises are totally damaged or
are rendered wholly untenantable, or if the Building is so damaged that in
Landlord's opinion, substantial alteration, demolition, or reconstruction of the
Building is required (whether or not the Premises are so damaged or rendered
untenantable), then in either of such events, Landlord may, not later than 60
days following the date of the damage, give Tenant a notice terminating this
Lease, provided that if the Premises are not damaged, Landlord may not terminate
this Lease unless Landlord similarly terminates the leases of other tenants in
the Building covering, in the aggregate, at least 50% of the rentable area of
the Building which is or was occupied immediately prior to such damage. If this
Lease is so terminated, (i) the Term shall expire upon the date set forth in
Landlord's notice (with the same effect as if such date were the Expiration
Date), which shall not be less than 30 days after such notice is given, and
Tenant shall vacate the Premises and surrender the same to Landlord no later
than the date set forth in the notice, (ii) Tenant's liability for Rent which
accrues thereafter shall cease as of the date of the damage, (iii) any prepaid
Rent for any period after the date of the damage shall be refunded by Landlord
to Tenant, and (iv) Landlord shall be entitled to collect all insurance proceeds
of policies held by Landlord or Tenant providing coverage for Alterations and
other improvements to the Premises (including the Initial Installations).
Landlord shall retain from such proceeds from Tenant's insurance an amount equal
to the unamortized portion of the sum total of amounts paid by Landlord for such
Alterations and improvements (including the Initial Installations), whether by
contribution, offset or otherwise, and the balance of such proceeds, if any,
shall be paid to Tenant, such amortization to be calculated using a
straight-line amortization schedule over the useful life
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of the Alteration or improvement determined in accordance with generally
accepted accounting principles consistently applied, with interest thereon at
the Base Rate plus 2% per annum.
Section 14.3 TENANT'S TERMINATION RIGHT. If the Premises are totally
damaged and are thereby rendered wholly untenantable, or if the Building shall
be so damaged that Tenant is deprived of reasonable access to the Premises, and
if Landlord elects to restore the core and shell of the Premises, Landlord
shall, within 60 days following the date of the damage, cause a contractor or
architect selected by Landlord to give notice (the "Restoration Notice") to
Tenant of the date by which such contractor or architect estimates the
restoration of the Premises shall be Substantially Completed. If such date, as
set forth in the Restoration Notice, is more than 18 months from the date of
such damage, then Tenant shall have the right to terminate this Lease by giving
notice (the "Termination Notice") to Landlord not later than 30 days following
Tenant's receipt of the Restoration Notice. If Tenant delivers a Termination
Notice to Landlord within said 30 day period, then this Lease shall be deemed to
have terminated as of the date of the giving of the Termination Notice, in the
manner and subject to the conditions set forth in the second sentence of Section
14.2.
Section 14.4 FINAL 24 MONTHS. Notwithstanding anything set forth to the
contrary in this Article 14, in the event that any damage rendering the Premises
wholly untenantable occurs during the final 24 months of the Term, either
Landlord or Tenant may terminate this Lease by notice to the other party within
30 days after the occurrence of such damage and this Lease shall expire on the
30th day after the date of such notice. For purposes of this Section 14.4, the
Premises shall be deemed wholly untenantable if due to such damage, Tenant shall
be precluded from using more than 50% of the floor area of the Premises for the
conduct of its business and Tenant's inability to so use the Premises is
reasonably expected to continue until at least the earlier of the (i) Expiration
Date, or (ii) the 90th day after the date when such damage occurs.
Section 14.5 WAIVER OF REAL PROPERTY LAW SECTION 227. This Article
constitutes an express agreement governing any case of damage or destruction of
the Premises or the Building by fire or other casualty, and Section 227 of the
Real Property Law of the State of New York, which provides for such contingency
in the absence of an express agreement, and any other law of like nature and
purpose now or hereafter in force, shall have no application in any such case.
Section 14.6 INABILITY TO COLLECT. Notwithstanding any of the foregoing
provisions of this Article 14, if Landlord or any Lessor or Mortgagee shall be
unable to collect all of the insurance proceeds (including rent insurance
proceeds) applicable to damage or destruction of the Premises or the Building by
reason of any action or inaction on the part of Tenant or any Tenant Party,
then, without prejudice to any other remedies which may be available against
Tenant, (i) there shall be no abatement of Rent, and (ii) Landlord shall have no
obligation to restore the core and shell of the Premises or the Building
Systems.
Section 14.7 LANDLORD'S LIABILITY. Any Building employee to whom any
property shall be entrusted by or on behalf of Tenant shall be deemed to be
acting as Tenant's agent with respect to such property and neither Landlord nor
any of the Indemnitees shall be liable for any damage to such property, or for
the loss of or damage to any property of Tenant by theft or otherwise. Neither
Landlord nor any of the other Indemnitees shall be liable for any injury or
damage to persons or property or interruption of Tenant's business resulting
from fire or other casualty, any damage caused by other tenants or persons in
the Building or by construction of any private, public or quasi-public work, or
any latent defect in the Premises or in the Building (except that Landlord shall
be required to repair the same to the extent expressly provided in Article 7).
Without limitation, Tenant agrees to use and occupy the Premises at its own
risk, and neither Landlord nor any Indemnitees shall have any responsibility or
liability for any loss of or damage to Tenant's Property or other personal
property of Tenant or those claiming by, through or under Tenant. No penalty
shall accrue for delays which may arise by reason of adjustment of insurance on
the part of Landlord or Tenant, or Unavoidable Delays, or in connection with any
repair or restoration of any portion of the Premises or of the Building or of
the Center. Landlord shall use reasonable efforts to minimize interference with
Tenant's use and occupancy of the Premises during the performance of any such
repair or restoration; provided, however, Landlord shall have no obligation to
employ contractors or
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labor at overtime or other premium pay rates or to incur any other overtime
costs or additional expenses whatsoever. Nothing in this Section 14.7 shall
affect any right of Landlord to be indemnified by Tenant pursuant to the
provisions of Article 32 for payments made to compensate for losses of third
parties.
Section 14.8 WINDOWS. If at any time any windows of the Premises are
temporarily closed, darkened or covered over by reason of repairs, maintenance,
alterations or improvements to the Building, or any of such windows are
permanently closed, darkened or covered over due to any Requirement, Landlord
shall not be liable for any damage Tenant may sustain and Tenant shall not be
entitled to any compensation or abatement of any Rent, nor shall the same
release Tenant from its obligations hereunder or constitute an actual or
constructive eviction.
Section 14.9 RESTORATION BY TENANT. Unless this Lease is terminated as
provided in this Article 14, if the Premises shall be damaged by fire or other
casualty, then Tenant shall (i) repair and restore all portions of the Premises
not required to be restored by Landlord pursuant to this Article 14 to
substantially the condition at the time of such casualty, (ii) equip the
Premises with trade fixtures, equipment and all personal property necessary or
proper for the operation of Tenant's business; and (iii) open for business in
the Premises as soon thereafter as possible.
ARTICLE 15
EMINENT DOMAIN
Section 15.1 (a) TOTAL TAKING. If all or substantially all of the
Premises, the Building or the Real Property shall be acquired or condemned for
any public or quasi-public purpose, this Lease shall terminate and the Term
shall end as of the date of the vesting of title, with the same effect as if
such date were the Expiration Date.
(b) PARTIAL TAKING. If only a part of the Premises, the Building or the
Real Property shall be acquired or condemned, this Lease and the Term shall
continue in full force and effect, provided that from and after the date of the
vesting of title, Fixed Rent, Tenant's Tax Payment and Tenant's Operating
Payment shall be modified to reflect the reduction of the Premises and/or the
Building as a result of such acquisition or condemnation.
(c) LANDLORD'S TERMINATION RIGHT. Whether or not the Premises are
affected, Landlord may give to Tenant, within 60 days following the date upon
which Landlord receives notice that all or a portion of the Building or the Real
Property has been acquired or condemned, a notice of termination of this Lease,
provided that Landlord elects to terminate leases (including this Lease)
affecting at least 50% of the rentable area of the Building (excluding any
rentable area leased by Landlord or its Affiliates).
(d) TENANT'S TERMINATION RIGHT. If the part of the Building or the Real
Property so acquired or condemned contains a substantial part of the total area
of the Premises immediately prior to such acquisition or condemnation, or if by
reason of such acquisition or condemnation, Tenant no longer has reasonable
means of access to the Premises, Tenant may terminate this Lease by notice to
Landlord given within 60 days following the date upon which Tenant received
notice of such acquisition or condemnation. If Tenant so notifies Landlord, this
Lease shall terminate and the Term shall end and expire upon the date set forth
in the notice (with the same effect as if such date were the Expiration Date),
which date shall not be more than 30 days following the giving of such notice.
If a part of the Premises shall be so acquired or condemned and this Lease and
the Term shall not be terminated in accordance with this Section 15.1, Landlord,
at Landlord's expense but without requiring Landlord to spend more than it
collects as an award, shall, subject to the provisions of any Mortgage or
Superior Lease, restore that part of the Premises not so acquired or condemned
to a self-contained rental unit substantially equivalent (with respect to
character, quality, appearance and services) to that which existed immediately
prior to such acquisition or condemnation, excluding Tenant's Property, and/or
any Alterations or improvements, including the Initial Installations.
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(e) APPORTIONMENT OF RENT. Upon any termination of this Lease pursuant
to the provisions of this Article 15, Fixed Rent, Tenant's Tax Payment and
Tenant's Operating Payment shall be apportioned as of, and shall be paid or
refunded up to and including, the date of such termination.
(f) APPLICABILITY. The provisions of Sections 15.1 and 15.2 shall not
apply to any acquisition or condemnation of all or any part of the Premises for
a period of 18 months or less.
Section 15.2 AWARDS. Upon any acquisition or condemnation of all or any
part of the Premises, the Building or the Real Property, Landlord shall receive
the entire award for any such acquisition or condemnation, and Tenant shall have
no claim against Landlord or the condemning authority for the value of any
unexpired portion of the Term or for the Alterations or other improvements,
including the Initial Installations; and Tenant hereby assigns to Landlord all
of its right in and to such award. Without limiting the foregoing, out of the
net amount of any such award actually received by Landlord (after deducting
costs of recovery, taxes, amounts payable to lenders, reasonable attorneys fees,
and the like), if any, provided that Tenant shall have certified the amount of
Tenant's Leasehold Improvement Costs (hereinafter defined) to Landlord within 90
days after the Rent Commencement Date, Tenant shall be entitled to an amount
equal to the unamortized portion of the Tenant's Leasehold Improvement Costs.
The "Tenant's Leasehold Improvement Costs" shall mean the actual costs incurred
by Tenant in constructing the Initial Installations, but excluding costs for
moveable and trade fixtures, furniture, equipment and any other personal
property, design costs, legal fees, engineering fees and other soft costs and
also excluding the Landlord's Contribution. Such amortization shall be
calculated using a straight-line amortization schedule over the useful life of
the Alteration or Improvement determined in accordance with generally accepted
accounting principles consistently applied, with interest thereon at the Base
Rate plus 2% per annum. Nothing contained in this Article shall be deemed to
prevent Tenant from making a separate claim in any condemnation proceedings for
the then-value of any Tenant's Property included in such taking and for any
moving expenses, provided any such award is in addition to, and does not result
in a reduction of, the award made to Landlord.
Section 15.3 TEMPORARY TAKING. Notwithstanding the provisions of Section
5.1, if all or any part of the Premises is acquired or condemned for a period of
18 months or less during the Term for any public or quasi-public use or purpose,
Tenant shall give prompt notice to Landlord, and the Term shall not be reduced
or affected in any way, and Tenant shall continue to pay all Rent payable by
Tenant without reduction or abatement and to perform all its other obligations
under this Lease, except to the extent prevented from doing so by the condemning
authority. Tenant shall be entitled to receive any award or payment from the
condemning authority for such use, which award shall be received, held and
applied by Tenant as a trust fund for payment of Rent falling due, provided that
if the acquisition or condemnation is for a period extending beyond the Term,
such award shall be apportioned between Landlord and Tenant and Landlord shall
receive the portion of such award relating to the period after the Term. If the
acquisition or condemnation of all or any part of the Premises is for a period
of more than 18 months, the provisions of Sections 15.1 and 15.2 shall apply.
ARTICLE 16
ASSIGNMENT AND SUBLETTING
Section 16.1 (a) NO ASSIGNMENT OR SUBLETTING. Except as expressly set
forth herein, Tenant shall not assign, mortgage, pledge, encumber, license or
otherwise transfer this Lease, whether by operation of law or otherwise, and
shall not sublet (or underlet), or permit, or suffer the Premises or any part
thereof to be used or occupied by others, without Landlord's prior consent in
each instance. Any assignment, sublease, mortgage, pledge, encumbrance, license
or transfer in contravention of the provisions of this Article 16 shall be void.
(b) COLLECTION OF RENT. If, without Landlord's consent, this Lease is
assigned, or any part of the Premises is sublet or occupied by anyone other than
Tenant, or this Lease or the Premises or any of Tenant's Property is encumbered
(by operation of law or otherwise), Landlord may collect rent from the assignee,
subtenant or occupant and apply the net amount collected to the Rent herein
reserved. No
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such collection of rent shall be deemed to be (i) a waiver of the provisions of
this Article, (ii) an acceptance of the assignee, subtenant or occupant as
tenant, or (iii) a release of Tenant from the performance of any of the terms,
covenants and conditions to be performed by Tenant under this Lease, including
the payment of Rent.
(c) NO WAIVER. Landlord's consent to any assignment or subletting shall
not relieve Tenant from the obligation to obtain Landlord's express consent to
any further assignment or subletting. In no event shall any permitted subtenant
assign or encumber its sublease or further sublet any portion of its sublet
space, or otherwise suffer or permit any portion of the sublet space to be used
or occupied by others. The listing of any name other than that of Tenant in the
directory, or on the doors of the Premises or elsewhere, shall not vest in any
such named party any right or interest in this Lease or in the Premises, nor be
deemed to constitute Landlord's consent to any assignment or transfer of this
Lease, or to any sublease of the Premises, or to the use or occupancy thereof by
others.
Section 16.2 TENANT'S NOTICE. If Tenant desires to assign this Lease or
sublet all or any portion of the Premises, Tenant shall give notice thereof to
Landlord, which shall be accompanied by (i) with respect to an assignment of
this Lease, the date Tenant desires the assignment to be effective, and (ii)
with respect to a sublet of all or a part of the Premises, (A) the material
business terms on which Tenant would sublet such premises, and (B) a description
of the portion of the Premises to be sublet. Such notice shall be deemed an
offer from Tenant to Landlord whereby Landlord (or Landlord's designee) shall be
granted the right, at Landlord's option (1) to terminate this Lease with respect
to such space as Tenant proposes to sublease, upon the terms and conditions
hereinafter set forth, or (2) if the proposed transaction is an assignment of
this Lease or a subletting of 50% or more of the rentable square footage of the
Premises, to terminate this Lease with respect to the entire Premises. Such
option may be exercised by notice from Landlord to Tenant within 45 days after
Landlord's receipt of Tenant's notice.
Section 16.3 LANDLORD'S TERMINATION. If Landlord exercises its option to
terminate all or a portion of this Lease pursuant to Section 16.2: (i) this
Lease shall end and expire with respect to all or a portion of the Premises, as
the case may be, on the date that such assignment or sublease was to commence
(as if such date were the Expiration Date), (ii) Fixed Rent and Tenant's Tax
Payment and Tenant's Operating Payment shall be apportioned, paid or refunded as
of such date, (iii) Tenant, upon Landlord's request, shall enter into an
amendment of this Lease ratifying and confirming such total or partial
termination, and setting forth any appropriate modifications to the terms and
provisions hereof, (iv) Landlord shall be free to lease the Premises (or any
part thereof) to Tenant's prospective assignee or subtenant, and (v) if this
Lease shall terminate with respect to a portion of the Premises, Tenant shall,
at Tenant's sole cost and expense, separately demise such portion of the
Premises, and make available all utility services so as to make such portion of
the Premises a self-contained rental unit satisfactory in all respects to
Landlord and in compliance with all Requirements.
Section 16.4 CONDITIONS TO ASSIGNMENT OR SUBLETTING. (a) With respect to
each and every assignment and/or subletting authorized by Landlord under the
provisions of this Lease, it is further agreed that:
(i) the form of the proposed assignment or sublease shall be
reasonably satisfactory to Landlord and shall comply with the provisions
of this Article;
(ii) no sublease shall be for a term ending later than one day
prior to the Expiration Date of this Lease;
(iii) no sublease shall be delivered to any subtenant, and no
subtenant shall take possession of any part of the Premises, until an
executed counterpart of such sublease has been delivered to Landlord and
approved in writing by Landlord;
(iv) if an Event of Default shall occur at any time prior to the
effective date of such assignment or subletting, then Landlord's consent
thereto, if previously granted, shall be immediately deemed revoked
without further notice to Tenant, and if such assignment or
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subletting would have been permitted without Landlord's consent pursuant
to Section 16.8, such permission shall be void and without force and
effect, and in either such case, any such assignment or subletting shall
constitute a further Event of Default hereunder; and
(v) each sublease shall be subject and subordinate to this Lease
and to the matters to which this Lease is or shall be subordinate, it
being the intention of Landlord and Tenant that Tenant shall assume and
be liable to Landlord for any and all acts and omissions of all
subtenants and anyone claiming under or through any subtenants which, if
performed or omitted by Tenant, would be a default under this Lease; and
Tenant and each subtenant shall be deemed to have agreed that upon the
occurrence and during the continuation of an Event of Default hereunder,
Tenant has hereby assigned to Landlord, and Landlord may, at its option,
accept such assignment of, all right, title and interest of Tenant as
sublandlord under such sublease, together with all modifications,
extensions and renewals thereof then in effect, 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 be
(A) liable for any previous act or omission of Tenant under such
sublease, (B) subject to any counterclaim, offset or defense not
expressly provided in such sublease, which theretofore accrued to such
subtenant against Tenant, (C) bound by any previous modification of such
sublease not consented to by Landlord, or by any prepayment of more than
one month's rent and additional rent under such sublease, (D) bound to
return such subtenant's security deposit, if any, except to the extent
that Landlord shall receive actual possession of such deposit and such
subtenant shall be entitled to the return of all or any portion of such
deposit under the terms of its sublease, or (E) obligated to make any
payment to or on behalf of such subtenant, or to perform any work in the
subleased space or the Building, or in any way to prepare the subleased
space for occupancy, beyond Landlord's obligations under this Lease. The
provisions of this Section 16.4(b)(v) shall be self-operative, and no
further instrument shall be required to give effect hereto, provided
that the subtenant shall execute and deliver to Landlord any instruments
Landlord may reasonably request to evidence and confirm such
subordination and attornment.
Section 16.5 NO RELEASE OF TENANT: INDEMNIFICATION OF LANDLORD.
Notwithstanding any assignment or subletting or any acceptance of Rent by
Landlord from any assignee or subtenant, Tenant shall remain fully liable for
the payment of all Rent due and for the performance of all other terms,
covenants and conditions contained in this Lease on Tenant's part to be observed
and performed, and any default under any term, covenant or condition of this
Lease by any subtenant shall be deemed a default under this Lease by Tenant.
Tenant shall indemnify, defend, protect and hold harmless Landlord from and
against any and all Losses (as defined in Section 32.1(b)) arising out of or
resulting from any claims that may be made against Landlord by the proposed
assignee or subtenant or by any brokers or other Persons claiming a commission
or similar compensation in connection with the proposed assignment or sublease,
irrespective of whether Landlord shall give or decline to give its consent to
any proposed assignment or sublease, or if Landlord shall exercise any of its
options under this Article 16.
Section 16.6 TENANT'S FAILURE TO COMPLETE. If Landlord consents to a
proposed assignment or sublease and Tenant fails to execute and deliver to
Landlord such assignment or sublease within 90 days after the giving of such
consent, then Tenant shall again comply with all of the provisions and
conditions of Sections 16.2 and 16.4 hereof before assigning this Lease or
subletting all or part of the Premises.
Section 16.7 PROFITS. If Tenant shall enter into any assignment or
sublease permitted hereunder or consented to by Landlord, Tenant shall, within
60 days after Landlord's consent to such assignment or sublease, deliver to
Landlord a complete list of Tenant's reasonable third-party brokerage fees,
legal fees and architectural fees paid or to be paid in connection with such
transaction, together with a list of all of Tenant's Property to be transferred
to such assignee or sublessee. Tenant shall deliver to Landlord evidence of the
payment of such fees promptly after the same are paid. In consideration of such
assignment or subletting, Tenant shall pay to Landlord:
(a) In the case of an assignment, on the effective date of the
assignment, an amount equal to 50% of all sums and other consideration
paid to Tenant by the assignee for or by reason
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of such assignment (including sums paid for the sale or rental of
Tenant's Property), less (i) in the case of a sale of Tenant's Property,
the then fair market value thereof, as reasonably determined by
Landlord, (ii) the reasonable out-of-pocket costs and expenses incurred
by Tenant in connection with said assignment such as brokerage fees,
legal fees, architectural fees and advertising fees paid to unrelated
third parties, and (iii) costs approved in advance by Landlord incurred
by Tenant for Alterations made solely to prepare the Premises or
portions thereof for such assignment; or
(b) In the case of a sublease, 50% of any consideration payable
under the sublease to Tenant by the subtenant which exceeds, on a per
square foot basis, Fixed Rent and Additional Rent accruing during the
term of the sublease in respect of the subleased space (together with
any sums paid for the sale or rental of Tenant's Property), less (i) in
the case of the sale of Tenant's Property, the then fair market value
thereof, as reasonably determined by Landlord, (ii) the reasonable
out-of-pocket costs and expenses incurred by Tenant in connection with
said sublease, such as brokerage fees, legal fees, architectural fees
and advertising fees paid to unrelated third parties, (iii) costs
approved in advance by Landlord incurred by Tenant for Alterations made
solely to prepare the Premises or portion thereof for such subletting,
and (iv) if such sublease is of less than the entire Premises, the
actual cost incurred by Tenant in separately demising the subleased
space. The sums payable under this clause shall be paid by Tenant to
Landlord as and when paid by the subtenant to Tenant.
Section 16.8 (a) TRANSFERS. If Tenant is a corporation, the transfer by
one or more transfers, directly or indirectly, by operation of law or otherwise,
of a majority of the stock of Tenant shall be deemed a voluntary assignment of
this Lease; provided, however, that the provisions of this Article shall not
apply to the transfer of shares of stock of Tenant if and so long as the voting
of stock of Tenant is publicly traded on a nationally recognized stock exchange.
For purposes of this Section 16.8 the term "transfers" shall be deemed to
include the issuance of new stock or of treasury stock which results in a
majority of the stock of Tenant being held by a Person or Persons that do not
hold a majority of the stock of Tenant on the date hereof. If Tenant is a
partnership, the transfer by one or more transfers, directly or indirectly, by
operation of law or otherwise, of a majority interest in the partnership or
otherwise in violation of the provisions of Section 29.2 shall be deemed a
voluntary assignment of this Lease. If Tenant is a limited liability company,
trust, or any other legal entity (including a corporation or partnership), the
transfer by one or more transfers, directly or indirectly, of Control of such
entity, however characterized, shall be deemed a voluntary assignment of this
Lease. Notwithstanding the provisions of Section 16.1, Landlord will not
unreasonably withhold its consent to an assignment of this Lease in connection
with transactions with an entity into or with which Tenant is merged or
consolidated or to which all or substantially all of Tenant's assets are
transferred so long as: (i) such entity shall agree with Landlord to be bound by
all of the obligations of Tenant hereunder; (ii) such assignment shall not
relieve Tenant of any of its obligations hereunder; (iii) such transfer was made
for a legitimate independent business purpose and not for the purpose of
transferring this Lease, (iv) the successor to Tenant has a net worth computed
in accordance with generally accepted accounting principles at least equal to
the greater of (A) the net worth of Tenant immediately prior to such merger,
consolidation or transfer, and (B) the net worth of the original Tenant on the
date of this Lease, and (v) in Landlord's sole judgment such entity has the
business experience and good reputation necessary to conduct the business
permitted hereunder (i.e. the operation of first class health club facilities in
major urban areas), in a manner consistent with the high quality of Tenant named
herein, and is of a character which is in keeping with the standards for the
Building and the Center and the occupancy thereof. Without limitation, Landlord
and Tenant acknowledge and agree that based on the unique business operation of
the Tenant named herein, as of the date of this Lease, there are no other health
club operators that operate or conduct businesses consistent with the high
quality of the tenant named herein.
(b) APPLICABILITY. The limitations set forth in this Section 16.8 shall
apply to subtenant(s), assignee(s) and guarantor(s) of this Lease, if any, and
any transfer by any such entity in violation of this Section 16.8 shall be a
transfer in violation of Section 6.1.
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(c) MODIFICATIONS, TAKEOVER AGREEMENTS. Any modification, amendment or
extension of a sublease and/or any other agreement by which a landlord (or its
affiliate) of a building other than the Building agrees to assume or perform the
obligations of Tenant under this Lease shall be deemed a sublease for the
purposes of Section 16.1 hereof.
Section 16.9 ASSUMPTION OF OBLIGATIONS. Any assignment or transfer,
whether made with Landlord's consent or without Landlord's consent, if and to
the extent permitted hereunder, shall not be effective unless and until the
assignee executes, acknowledges and delivers to Landlord (i) an agreement in
form and substance satisfactory to Landlord whereby the assignee (A) assumes
Tenant's obligations under this Lease, and (B) agrees that, notwithstanding such
assignment or transfer, the provisions of Section 16.1 hereof shall be binding
upon it in respect of all future assignments and transfers, and (ii)
certificates or policies of insurance as required under Article 13.
Section 16.10 TENANT'S LIABILITY. The joint and several liability of
Tenant and any successors-in-interest of Tenant and the due performance of
Tenant's obligations under this Lease shall not be discharged, released or
impaired by any agreement or stipulation made by Landlord, or any grantee or
assignee of Landlord, extending the time, or modifying any of the terms and
provisions of this Lease, or by any waiver or failure of Landlord, or any
grantee or assignee of Landlord, to enforce any of the terms and provisions of
this Lease.
Section 16.11 LEASE NOT AFFIRMED OR REJECTED. If at any time after an
assignment by Tenant named herein, this Lease is not affirmed or rejected in any
proceeding of the types described in Section 19.1(h) or (i) or any similar
proceeding, or upon a termination of this Lease due to any such proceeding,
Tenant named herein, upon request of Landlord given within 30 days after such
disaffirmance, rejection or termination (and actual notice thereof to Landlord
in the event of a disaffirmance or rejection or in the event of termination
other than by act of Landlord), shall (i) pay to Landlord all Rent and other
charges due and owing by the assignee to Landlord under this Lease to and
including the date of such disaffirmance, rejection or termination, and (ii) as
"tenant," enter into a new lease of the Premises with Landlord for a term
commencing on the effective date of such disaffirmance, rejection or termination
and ending on the Expiration Date, unless sooner terminated in accordance
therewith, at the same Rent and upon the then executory terms, covenants and
conditions contained in this Lease, except that (A) the rights of Tenant named
herein under the new lease shall be subject to the possessory rights of the
assignee under this Lease and the possessory rights of any Persons claiming
through or under such assignee or by virtue of any statute or of any order of
any court, (B) such new lease shall require all defaults existing under this
Lease to be cured by Tenant named herein with due diligence, and (C) such new
lease shall require Tenant named herein to pay all Rent which, had this Lease
not been so disaffirmed, rejected or terminated, would have become due under the
provisions of this Lease after the date of such disaffirmance, rejection or
termination with respect to any period prior thereto. If Tenant named herein
defaults in its obligations to enter into such new lease for a period of 10 days
after Landlord's request, then, in addition to all other rights and remedies by
reason of default, either at law or in equity, Landlord shall have the same
rights and remedies against Tenant named herein as if it had entered into such
new lease and such new lease had thereafter been terminated as of the
commencement date thereof by reason of Tenant's default thereunder.
Section 16.12 ASSIGNMENT TO A WHOLLY-OWNED SUBSIDIARY. Notwithstanding
the foregoing provisions, Tenant may upon not less than 30 days prior notice to
Landlord, one time during the Term, assign this Lease to a wholly-owned
subsidiary of Tenant (but only for such period of time as such corporation shall
remain a wholly-owned subsidiary of Tenant, it being agreed that the subsequent
sale or transfer of stock resulting in a change of voting control, or any other
transaction(s) having the overall effect that such corporation ceases to be a
wholly-owned subsidiary of Tenant, shall be treated as if such sale or transfer
or transaction(s) were, for all purposes, an assignment of this Lease prohibited
by the provisions of Section 16.1); provided, however, and it shall be a
condition precedent of the validity of any such assignment, that (i) such
wholly-owned subsidiary first agree in writing, directly with Landlord, to be
bound by all of the obligations of Tenant hereunder, including the obligation to
pay Rent and other amounts provided for under this Lease, the covenant to use
the Premises only for the purposes specifically permitted under this Lease, and
the covenant against any further assignment, and (ii) the
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Tenant shall execute and deliver to Landlord documents satisfactory to Landlord
in its sole discretion confirming that such assignment shall not relieve Tenant
of any of its obligations hereunder, and that Tenant shall remain fully and
primarily liable for the payment of all Rent due and for the performance of all
other terms, covenants and conditions contained in this Lease on Tenant's part
to be performed and observed, and that any default under any term, covenant or
condition of this Lease by any such subsidiary shall be deemed a default by
Tenant under this Lease.
Section 16.13 PERMITTED SUBLEASES.
(a) Notwithstanding the foregoing, provided that no Event of Default has
occurred hereunder, upon not less than 30 days prior notice to Landlord, Tenant
may sublet not more than 7,000 rentable square feet of the Premises for use as a
private cafe (i.e. not open to the public and providing food and services only
to Tenant's members) (said 7,000 rentable square feet to be inclusive of all
areas used in connection with cafe operations, including all kitchen and seating
areas), provided that each and every one of the following conditions are fully
and completely satisfied: (i) said cafe shall be operated in a first-class
fashion and manner, not materially different from the cafe (not the restaurant)
operated on the date of this Lease in the Reebok Sports Club facility referred
to in Section 36.2(c); (ii) the Premises continue to be operated a first-class
health club/sports club facility in accordance with the requirements of this
Lease; (iii) the subleased portion of the Premises shall be operated and
maintained in a first-class condition, in accordance with the requirements of
this Lease and the then-standards of the Building and the Center; (iv) the
proposed subtenant has, in Landlord's reasonable judgment, sufficient financial
means to perform all of its obligations under the sublease; (v) Tenant shall,
upon demand, reimburse Landlord for all costs and expenses incurred by Landlord
in connection with such sublease, including reviewing any plans and
specifications for Alterations proposed to be made in connection therewith, and
all legal fees and expenses incurred by Landlord; (vi) the proposed sublease
shall comply with all of the requirements of this Lease, including Section 16.4
hereof, excepting only the obligations of Tenant pursuant to Section 16.7; and
(vii) notwithstanding any such sublease, Tenant shall remain fully and primarily
liable for the payment of all Rent due and for the performance of all other
terms, covenants and conditions contained in this Lease on Tenant's part to be
observed and performed, and any default under any term, covenant or condition of
this Lease by any subtenant shall be deemed a default by Tenant hereunder.
(b) Notwithstanding the foregoing, provided that no Event of Default has
occurred hereunder, upon not less than 30 days prior notice to Landlord, Tenant
may sublet not more than 4,500 rentable square feet of the Premises for use as a
private spa facility (i.e. not open to the public and providing services only to
Tenant's members), provided that each and every one of the following conditions
are fully and completely satisfied: (i) said private spa facility shall be
operated in a first-class fashion and manner not materially different from the
spa facility operated on the date of this Lease in the Reebok Sports Club
facility referred to in Section 36.2(c); (ii) the Premises continue to be
operated a first-class health club/sports club facility in accordance with the
requirements of this Lease; (iii) the subleased portion of the Premises shall be
operated and maintained in a first-class condition, in accordance with the
requirements of this Lease and the then-standards of the Building and the
Center; (iv) the proposed subtenant has, in Landlord's reasonable judgment,
sufficient financial means to perform all of its obligations under the sublease;
(v) Tenant shall, upon demand, reimburse Landlord for all costs and expenses
incurred by Landlord in connection with such sublease, including reviewing any
plans and specifications for Alterations proposed to be made in connection
therewith, and all legal fees and expenses incurred by Landlord; (vi) the
proposed sublease shall comply with all of the requirements of this Lease,
including Section 16.4 hereof, excepting only the obligations of Tenant pursuant
to Section 16.7; and (vii) notwithstanding any such sublease, Tenant shall
remain fully and primarily liable for the payment of all Rent due and for the
performance of all other terms, covenants and conditions contained in this Lease
on Tenant's part to be observed and performed, and any default under any term,
covenant or condition of this Lease by any subtenant shall be deemed a default
by Tenant hereunder.
(c) Notwithstanding the foregoing, provided that no Event of Default has
occurred hereunder, upon not less than 30 days prior notice to Landlord, Tenant
may sublet not more than 3,000 rentable square feet of the Premises for use as a
private hair salon (i.e. not open to the public and providing goods and services
only to Tenant's members), provided that each and every one of the following
conditions are
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fully and completely satisfied: (i) said private hair salon facility shall be
operated in a first-class fashion and manner not materially different from the
hair salon operated on the date of this Lease in the Reebok Sports Club facility
referred to in Section 36.2(c); (ii) the Premises continue to be operated a
first-class health club/sports club facility in accordance with the requirements
of this Lease; (iii) the subleased portion of the Premises shall be operated and
maintained in a first-class condition, in accordance with the requirements of
this Lease and the then-standards of the Building and the Center; (iv) the
proposed subtenant has, in Landlord's reasonable judgment, sufficient financial
means to perform all of its obligations under the sublease; (v) Tenant shall,
upon demand, reimburse Landlord for all costs and expenses incurred by Landlord
in connection with such sublease, including reviewing any plans and
specifications for Alterations proposed to be made in connection therewith, and
all legal fees and expenses incurred by Landlord; (vi) the proposed sublease
shall comply with all of the requirements of this Lease, including Section 16.4
hereof, excepting only the obligations of Tenant pursuant to Section 16.7; and
(vii) notwithstanding any such sublease, Tenant shall remain fully and primarily
liable for the payment of all Rent due and for the performance of all other
terms, covenants and conditions contained in this Lease on Tenant's part to be
observed and performed, and any default under any term, covenant or condition of
this Lease by any subtenant shall be deemed a default by Tenant hereunder.
(d) Notwithstanding the foregoing, provided that no Event of Default has
occurred hereunder, upon not less than 30 days prior notice to Landlord, Tenant
may sublet not more than 3,000 rentable square feet of the Premises for use as a
private sports medicine facility (i.e. not open to the public and providing
services only to Tenant's members), provided that each and every one of the
following conditions are fully and completely satisfied: (i) said private sports
medicine facility shall be operated in a first-class fashion and manner not
materially different from the sports medicine facility operated on the date of
this Lease in the Reebok Sports Club facility referred to in Section 36.2(c);
(ii) the Premises continue to be operated a first-class health club/sports club
facility in accordance with the requirements of this Lease; (iii) the subleased
portion of the Premises shall be operated and maintained in a first-class
condition, in accordance with the requirements of this Lease and the
then-standards of the Building and the Center; (iv) the proposed subtenant has,
in Landlord's reasonable judgment, sufficient financial means to perform all of
its obligations under the sublease; (v) Tenant shall, upon demand, reimburse
Landlord for all costs and expenses incurred by Landlord in connection with such
sublease, including reviewing any plans and specifications for Alterations
proposed to be made in connection therewith, and all legal fees and expenses
incurred by Landlord; (vi) the proposed sublease shall comply with all of the
requirements of this Lease, including Section 16.4 hereof, excepting only the
obligations of Tenant pursuant to Section 16.7; and (vii) notwithstanding any
such sublease, Tenant shall remain fully liable for the payment of all Rent due
and for the performance of all other terms, covenants and conditions contained
in this Lease on Tenant's part to be observed and performed, and any default
under any term, covenant or condition of this Lease by any subtenant shall be
deemed a default by Tenant hereunder.
(e) Notwithstanding the foregoing, provided that no Event of Default has
occurred hereunder, upon not less than 30 days prior notice, Tenant may sublet
not more than 2,500 rentable square feet of the Premises for use as a private
clothing boutique (i.e. not open to the public and providing goods and services
only to Tenant's members), provided that each and every one of the following
conditions are fully and completely satisfied: (i) said private clothing
boutique shall be operated in a first-class fashion and manner not materially
different from the clothing boutique operated on the date of this Lease in the
Reebok Sports Club facility referred to in Section 36.2(c); (ii) the Premises
continue to be operated a first-class health club/sports club facility in
accordance with the requirements of this Lease; (iii) the subleased portion of
the Premises shall be operated and maintained in a first-class condition, in
accordance with the requirements of this Lease and the then-standards of the
Building and the Center; (iv) the proposed subtenant has, in Landlord's
reasonable judgment, sufficient financial means to perform all of its
obligations under the sublease; (v) Tenant shall, upon demand, reimburse
Landlord for all costs and expenses incurred by Landlord in connection with such
sublease, including reviewing any plans and specifications for Alterations
proposed to be made in connection therewith, and all legal fees and expenses
incurred by Landlord; (vi) the proposed sublease shall comply with all of the
requirements of this Lease, including Section 16.4 hereof, excepting only the
obligations of Tenant pursuant to Section 16.7; and (vii) notwithstanding any
such sublease, Tenant shall remain fully and primarily liable for the payment of
all Rent due and for the performance of all other terms, covenants and
conditions contained in
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this Lease on Tenant's part to be observed and performed, and any default under
any term, covenant or condition of this Lease by any subtenant shall be deemed a
default by Tenant hereunder.
ARTICLE 17
ELECTRICITY
Section 17.1 SUBMETERED ELECTRICITY. Subject to the provisions of this
Article 17, Landlord shall redistribute or furnish electricity to or for the use
of Tenant in the Premises for the operation of Tenant's electrical systems and
equipment in the Premises, at a level sufficient to accommodate a demand load of
4 xxxxx per usable square foot of area in the Premises (the "Permitted
Capacity"). Subject to the last sentence of this Section 17.1, Tenant shall pay
to Landlord, on demand from time to time but no more frequently than monthly,
for its consumption of electricity at the Premises, a sum equal to 103% of the
product obtained by multiplying (i) the Cost Per Kilowatt Hour, by (ii) the
actual number of kilowatt hours of electric current consumed by Tenant in such
billing period. "Cost Per Kilowatt Hour" means the total cost incurred by
Landlord to provide electricity to the Center during a particular billing
period, including energy charges, demand charges, surcharges, time-of-day
charges, fuel adjustment charges, rate adjustment charges, taxes, rebates and
any other factors used by the utility company in computing its charges to
Landlord, divided by the total kilowatt hours purchased by Landlord to provide
electricity to the Center during such period. If any tax is imposed upon
Landlord's receipts from the sale or resale of electricity to Tenant, Tenant
shall reimburse Landlord for such tax, if and to the extent permitted by law.
Landlord shall install a submeter or submeters, at Tenant's expense, to measure
Tenant's consumption of electricity in the Premises, which submeter shall be
maintained by Landlord at Tenant's expense. Where more than one submeter
measures Tenant's consumption of electricity in the Premises, the electricity
measured by each submeter shall be computed and billed separately in accordance
with the provisions set forth above. Bills for such amounts shall be rendered to
Tenant at such times as Landlord may elect. For any period during which such
submeter or submeters are not installed or are not operational in the Premises,
the monthly Fixed Rent shall be increased by an amount equal to the product of
(A) $.2083, subject to adjustment for any increases in electric rates or taxes,
and (B) the number of rentable square feet in the Premises.
Section 17.2 USE OF ELECTRICITY. Tenant shall at all times comply with
the rules and regulations of the utility company supplying electricity to the
Building. Tenant shall not use any electrical equipment which, in Landlord's
judgment, would exceed the Permitted Capacity or interfere with electrical
service to other tenants of the Building. Tenant shall not make or perform, or
permit the making or performance of, any Alterations to wiring installations or
other electrical facilities in or serving the Premises, or make any additions to
the equipment or other appliances in the Premises which utilize electrical
energy without the prior consent of Landlord, in each instance, and in
compliance with this Lease.
Section 17.3 SERVICE DISRUPTION. Landlord shall not be liable in any way
to Tenant for any failure, defect or interruption of, or change in the supply,
character and/or quantity of, electric service furnished to the Premises for any
reason except if caused solely by the gross negligence or willful misconduct of
Landlord, nor shall there be any allowance to Tenant for a diminution of rental
value, nor shall the same constitute an actual or constructive eviction of
Tenant, in whole or in part, or relieve Tenant from any of its Lease obligations
(except as expressly and specifically permitted pursuant to Section 12.10
hereof), and no liability shall arise on the part of Landlord by reason of
inconvenience, annoyance or injury to business, whether electricity is provided
by public or private utility or by any electricity generation system owned and
operated by Landlord. Landlord shall use reasonable efforts to minimize
interference with Tenant's use and occupancy of the Premises as a result of any
such failure, defect or interruption of, or change in the supply, character
and/or quantity of, electric service, provided that Landlord shall have no
obligation to employ contractors or labor at overtime or other premium pay rates
or to incur any other overtime costs or additional expenses whatsoever.
Section 17.4 DISCONTINUANCE OF SERVICE. Notwithstanding any provision to
the contrary contained in this Article 17, Landlord reserves the right to
discontinue furnishing electricity to Tenant in the Premises on not less than 30
days notice to Tenant; provided, that either (a) Landlord discontinues
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furnishing electricity to tenants (including Tenant) leasing, in the aggregate,
not less than at least 50% of the rentable area of the Building, or (b) Landlord
is required to discontinue furnishing electricity under applicable Requirements.
If Landlord exercises such right, or is compelled to discontinue furnishing
electricity to Tenant, then this Lease shall continue in full force and effect
and shall be unaffected thereby, except that from and after the effective date
of such discontinuance, Landlord shall not be obligated to furnish electricity
to Tenant hereunder. If Landlord so discontinues furnishing electricity, then
Tenant shall arrange to obtain electricity directly from any utility company or
other electricity provider serving the Premises to the extent available,
suitable and safe for such purposes. All equipment which may be required to
obtain electricity of substantially the same quantity, quality and character
shall be installed by Landlord, at the sole cost and expense of (i) Landlord, if
Landlord voluntarily discontinues such service, or (ii) Tenant, if (A) Landlord
is compelled to discontinue such service by the utility company or pursuant to
applicable Requirements, or (B) such discontinuance arises out of the acts or
omissions of Tenant. Landlord will not voluntarily discontinue furnishing
electricity to Tenant until Tenant is able to receive electricity directly from
the utility company or other company servicing the Building, unless the utility
company or other company is not prepared to furnish electricity to the Premises
on the date required as a result of Tenant's delay or negligence in arranging
for service, Tenant's refusal to provide the utility company or other company
with a deposit or other security requested by the utility company, or Tenant's
refusal to take any other action requested by the utility company or other
company. Tenant shall pay all costs and expenses for all electricity consumed on
the Premises during the Term, including all amounts payable directly to the
electricity provider pursuant to this Section 17.4.
ARTICLE 18
ACCESS TO PREMISES
Section 18.1 LANDLORD'S ACCESS. (a) Tenant shall permit Landlord,
Landlord's agents, utility companies and other service providers servicing the
Building to erect, use, maintain, repair and replace concealed ducts, pipes,
lines and conduits in and through the Premises, provided such use does not cause
the usable area of the Premises to be reduced beyond a de minimis amount.
Landlord shall promptly repair any damage to the Premises or Tenant's Property
caused by any work performed pursuant to this Article.
(b) Landlord, any Lessor or Mortgagee and any other party designated by
Landlord and their respective agents shall have the right to enter the Premises
at all reasonable times, upon reasonable notice (which notice may be oral)
except in the case of emergency, (i) to examine the Premises, (ii) to show the
Premises to prospective purchasers, Mortgagees or Lessors of the Building and
their respective agents and representatives or others, and, during the last 12
months of the Term, to prospective lessees of premises in the Center, and (iii)
to make such repairs, alterations or additions to the Premises or the Building
(A) as Landlord may deem necessary or desirable, (B) which Landlord may elect to
perform following Tenant's failure to perform, or (C) to comply with any
Requirements, and Landlord shall be allowed to take all material into the
Premises that may be required for the performance of such work without the same
constituting an actual or constructive eviction of Tenant in whole or in part
and without any abatement of Rent.
(c) All parts (except surfaces facing the interior of the Premises) of
all walls, windows and doors bounding the Premises, including exterior Building
walls, exterior core corridor walls, and doors and entrances (other than doors
and entrances solely connecting areas within the Premises), all balconies,
terraces and roofs adjacent to the Premises, all space in or adjacent to the
Premises used for shafts, stacks, risers, fan rooms, electrical and
communications closets, stairways, mail chutes, conduits and other mechanical
facilities, Building Systems and Building facilities are not part of the
Premises, and Landlord shall have the use thereof and access thereto through the
Premises for the purposes of Building operation, maintenance, alteration and
repair.
Section 18.2 ALTERATIONS TO BUILDING AND CENTER. Landlord has the right
at any time or from time-to-time, in its sole discretion, to (i) change the
name, number or designation by which the Building or Center is commonly known,
or (ii) alter the Building to change the arrangement or location of entrances or
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passageways, doors and doorways, and corridors, elevators, stairs, toilets, or
other public parts of the Building, or (iii) build, add to, subtract from,
relocate, alter, change or otherwise use the Center or any part thereof, or any
buildings, structures, or other areas or facilities therein or thereon, without
any such acts constituting an actual or constructive eviction and without
incurring any liability to Tenant, so long as such changes do not deny Tenant
reasonable access to the Premises. Landlord shall use reasonable efforts to
minimize interference with Tenant's use and occupancy of the Premises during the
making of such changes or alterations, provided that Landlord shall have no
obligation to employ contractors or labor at overtime or other premium pay rates
or to incur any other overtime costs or additional expenses whatsoever.
ARTICLE 19
DEFAULT
Section 19.1 TENANT'S DEFAULTS. Each of the following events shall be an
"Event of Default" hereunder:
(a) Tenant fails to pay when due any installment of Fixed Rent
or Additional Rent and such default continues for 5 days after
Landlord's notice of such default is given to Tenant; provided, however,
that if Tenant shall default in the timely payment of Fixed Rent or
Additional Rent 2 times in any period of 12 months, then,
notwithstanding that such defaults shall have each been cured within the
applicable period provided above, upon any further default in the timely
payment of Fixed Rent or Additional Rent, Landlord may serve a 3 days'
notice of termination upon Tenant without affording to Tenant an
opportunity to cure such further default; or
(b) Tenant defaults in observing or performing the provisions of
Section 3.1(a), and such default continues for 24 hours after notice; or
(c) if Landlord applies or retains any part of the Security
Deposit, and Tenant fails to deposit with Landlord the amount so applied
or retained by Landlord, or to provide Landlord with a replacement
Letter of Credit (as defined in Section 34.2), if applicable, within 5
days after notice by Landlord to Tenant stating the amount applied or
retained; or
(d) Tenant defaults in the observance or performance of any
other term, covenant or condition of this Lease to be observed or
performed by Tenant and such default continues for more than 15 days
after notice by Landlord to Tenant of such default; or if such default
is of such a nature that it can be remedied but cannot be completely
remedied within 15 days, Tenant fails to commence to remedy such default
within 15 days after such notice; or, with respect to any such default,
Tenant, having commenced such remedy within 15 days after such notice,
fails to diligently prosecute to completion all steps necessary to
remedy such default, or Tenant fails to complete such remedy within 90
days; or
(e) Tenant defaults in the observance or performance of any
term, covenant or condition on Tenant's part to be observed or performed
under any other lease with Landlord or Landlord's
predecessor-in-interest for space in the Center, and such default shall
continue beyond any grace period set forth in such other lease for the
remedying of such default; or
(f) Tenant's interest in this Lease shall devolve upon or pass
to any Person, whether by operation of law or otherwise, except as
expressly permitted under Article 16 hereof; or
(g) Tenant generally does not, or is unable to, or admits in
writing its inability to, pay its debts as they become due; or
(h) Tenant files a voluntary petition in bankruptcy or
insolvency, or is adjudicated a bankrupt or insolvent, or files any
petition or answer seeking any reorganization, liquidation, dissolution
or similar relief under any present or future federal bankruptcy act or
any other present
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or future applicable federal, state or other statute or law, or makes an
assignment for the benefit of creditors or seeks or consents to or
acquiesces in the appointment of any trustee, receiver, liquidator or
other similar official for Tenant or for all or any part of Tenant's
property; or
(i) if, within 60 days after the commencement of any proceeding
against Tenant, whether by the filing of a petition or otherwise,
seeking bankruptcy, insolvency, reorganization, arrangement,
composition, readjustment, liquidation, dissolution or similar relief
under the present or any future federal bankruptcy act or any other
present or future applicable federal, state or other statute or law,
such proceeding shall not have been dismissed, or if, within 60 days
after the appointment of any trustee, receiver, liquidator or other
similar official for Tenant, or for all or any part of Tenant's
property, without the consent or acquiescence of Tenant, such
appointment shall not have been vacated or otherwise discharged, or if
any lien, execution or attachment or other similar filing shall be made
or issued against Tenant or any of Tenant's property pursuant to which
the Premises shall be taken or occupied or attempted to be taken or
occupied by someone other than Tenant; or
(j) Excepting only those days on which Tenant is prevented from
remaining open by virtue of strike, fire, unavoidable casualty or other
event beyond the control of Tenant, but financial inability shall never
be deemed to be an event beyond Tenant's control (and Tenant agrees
promptly to advise Landlord of any such event and closing, and further
agrees to reopen as soon thereafter as possible), failure of Tenant,
after the Term commences, to be open for business to the public for more
than one day when required by this Lease to be so open in any one
calendar year, or for more than an aggregate of 3 such days during the
Term hereof, or if Tenant shall otherwise abandon or vacate the
Premises. Without limitation, the failure of Tenant to have completed
its Initial Installations and equipped the Premises and to have opened
for business on the Rent Commencement Date or the closing of the
Premises for business after Tenant has initially opened for business
therein, if such failure or closing continues for more than 3
consecutive days on which Tenant is required pursuant to applicable
provisions of this Lease to keep the Premises open for business, shall
be considered for the purposes hereof to be an abandonment of the
Premises by Tenant.
Upon the occurrence of any one or more of such Events of Default,
Landlord may, at its sole option, give to Tenant 3 days' notice of cancellation
of this Lease, in which event this Lease and the Term shall come to an end and
expire (whether or not the Term shall have commenced) upon the expiration of
such 3 day period with the same force and effect as if the date set forth in the
notice was the Expiration Date stated herein; and Tenant shall then quit and
surrender the Premises to Landlord, but Tenant shall remain liable for damages
as provided in Article 20 hereof.
Section 19.2 TENANT'S LIABILITY. If, at any time, (i) Tenant shall be
comprised of two or more Persons, (ii) Tenant's obligations under this Lease
shall have been guaranteed by any Person other than Tenant, or (iii) Tenant's
interest in this Lease shall have been assigned, the word "Tenant," as used in
Sections 19.1(g) (h) and (i), shall be deemed to mean any one or more of the
Persons primarily or secondarily liable for Tenant's obligations under this
Lease. Any monies received by Landlord from or on behalf of Tenant during the
pendency of any proceeding of the types referred to in this Article shall be
deemed paid as compensation for the use and occupancy of the Premises and the
acceptance of any such compensation by Landlord shall not be deemed an
acceptance of Rent or a waiver on the part of Landlord of any rights under this
Lease. This Lease and the obligations of Tenant to pay Rent and to perform all
of the other covenants and agreements of Tenant hereunder shall not be affected,
impaired or excused by any Unavoidable Delays, excepting only as expressly and
specifically set forth in Section 19.1(j) hereof.
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ARTICLE 20
REMEDIES AND DAMAGES
Section 20.1 (a) LANDLORD'S REMEDIES. If any Event of Default occurs,
and this Lease terminates as provided in Article 19:
(i) SURRENDER OF POSSESSION. Tenant shall quit and surrender the
Premises to Landlord, and Landlord and its agents may immediately, or at
any time after such Event of Default, re-enter the Premises or any part
thereof, without notice, either by summary proceedings, or by any other
applicable action or proceeding, or by force (to the extent permitted by
law) or otherwise in accordance with applicable legal proceedings
(without being liable to indictment, prosecution or damages therefor),
and may repossess the Premises and dispossess Tenant and any other
Persons from the Premises and remove any and all of their property and
effects from the Premises.
(ii) LANDLORD'S RELETTING. Landlord, at Landlord's option, may
relet all or any part of the Premises from time to time, either in the
name of Landlord or otherwise, to such tenant or tenants, for any term
ending before, on or after the Expiration Date, at such rental and upon
such other conditions (which may include concessions and free rent
periods) as Landlord, in its sole discretion, may determine. Landlord
shall have no obligation to and shall not be liable for refusal or
failure to relet or, in the event of any such reletting, for refusal or
failure to collect any rent due upon any such reletting; and no such
refusal or failure shall relieve Tenant of, or otherwise affect, any
liability under this Lease. Landlord, at Landlord's option, may make
such alterations, decorations and other physical changes in and to the
Premises as Landlord, in its sole discretion, considers advisable or
necessary in connection with such reletting or proposed reletting,
without relieving Tenant of any liability under this Lease or otherwise
affecting any such liability.
(b) OTHER REMEDIES. Upon the breach or threatened breach by Tenant, or
any Persons claiming through or under Tenant, of any term, covenant or condition
of this Lease, Landlord shall have the right to enjoin such breach and to invoke
any other remedy allowed by law or in equity as if re-entry, summary proceedings
and other special remedies were not provided in this Lease for such breach. The
rights to invoke the remedies set forth above are cumulative and shall not
preclude Landlord from invoking any other remedy allowed at law or in equity.
(c) TENANT'S WAIVER. Tenant, on its own behalf and on behalf of all
Persons claiming through or under Tenant, including all creditors, hereby waives
all rights which Tenant and all such Persons might otherwise have under any
Requirement (i) to the service of any notice of intention to re-enter or to
institute legal proceedings, (ii) to redeem, or to re-enter or repossess the
Premises, or (iii) to restore the operation of this Lease, after (A) Tenant
shall have been dispossessed or ejected by judgment or by warrant of any court
or judge, (B) any re-entry by Landlord, or (C) any expiration or early
termination of the term of this Lease, whether such dispossession, re-entry,
expiration or termination shall be by operation of law or pursuant to the
provisions of this Lease. The words "re-enter," "re-entry" and "re-entered" as
used in this Lease shall not be deemed to be restricted to their technical legal
meanings.
Section 20.2 (a) LANDLORD'S DAMAGES. If this Lease and the Term expires
and comes to an end as provided in Article 19, or by or under any summary
proceeding or any other action or proceeding, or if Landlord shall re-enter the
Premises as provided in Section 20.1, then, in any of such events:
(i) Tenant shall pay to Landlord all Rent payable under this
Lease by Tenant to Landlord up to the Expiration Date or to the date of
re-entry upon the Premises by Landlord, as the case may be;
(ii) Landlord shall be entitled to retain all monies, if any,
paid by Tenant to Landlord, whether as prepaid Rent, the Security
Deposit or otherwise, and to draw upon any Letter of Credit or other
security deposited by Tenant hereunder and retain the proceeds thereof,
which monies,
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to the extent not otherwise applied to amounts due and owing to
Landlord, shall be credited by Landlord against any damages payable by
Tenant to Landlord;
(iii) Tenant shall pay to Landlord, in monthly installments, on
the days specified in this Lease for payment of installments of Fixed
Rent, any Deficiency; it being understood that Landlord shall be
entitled to recover the Deficiency from Tenant each month as the same
shall arise, and no suit to collect the amount of the Deficiency for any
month shall prejudice Landlord's right to collect the Deficiency for any
subsequent month by a similar proceeding; and
(iv) whether or not Landlord shall have collected any monthly
payments on account of the Deficiency, Tenant shall pay to Landlord, on
demand, in lieu of any further payments on account of the Deficiency and
as liquidated and agreed final damages, a sum equal to the amount by
which the Rent for the period which otherwise would have constituted the
unexpired portion of the Term (assuming Additional Rent during such
period to be the same as had been payable for the year immediately
preceding such termination or re-entry, increased in each succeeding
year by 4% (on a compounded basis)) exceeds the then fair and reasonable
rental value of the Premises, for the same period (with both amounts
being discounted to present value at a rate of interest equal to 2%
below the then Base Rate) less the aggregate amounts on account of the
Deficiency theretofore collected by Landlord pursuant to the provisions
of Section 20.2(a)(iii) for the same period. If, before presentation of
proof of such liquidated damages to any court, commission or tribunal,
Landlord shall have relet the Premises or any part thereof for the
period which otherwise would have constituted the unexpired portion of
the Term or any part thereof, the amount of rent reserved upon such
reletting shall be deemed, prima facie, to be the fair and reasonable
rental value for the part or the whole of the Premises so relet during
the term of the reletting.
(b) RELETTING. If the Premises, or any part thereof, shall be relet
together with other space in the Building, the rents collected or reserved under
any such reletting and the expenses of any such reletting shall be equitably
apportioned for the purposes of this Section. Tenant shall not be entitled to
any rents collected or payable under any reletting, whether or not such rents
exceed Fixed Rent reserved in this Lease. Nothing contained in Articles 19 or 20
shall be deemed to limit or preclude the recovery by Landlord from Tenant of the
maximum amount allowed to be obtained as damages under applicable Requirements,
or of any sums or damages to which Landlord may be entitled in addition to the
damages set forth in this Section.
Section 20.3 DEFAULT INTEREST: OTHER RIGHTS OF LANDLORD. Any Rent or
damages payable under this Lease and not paid when due shall bear interest at
the Interest Rate from the due date until paid, and the interest shall be deemed
Additional Rent. If Tenant fails to pay any Additional Rent when due, Landlord,
in addition to any other right or remedy, shall have the same rights and
remedies as in the case of a default by Tenant in the payment of Fixed Rent. If
Tenant is in arrears in the payment of Rent, Tenant waives Tenant's right, if
any, to designate the items against which any payments made by Tenant are to be
credited, and Landlord may apply any payments made by Tenant to any items
Landlord sees fit, regardless of any request by Tenant. Landlord reserves the
right, without liability to Tenant and without constituting any claim of
constructive eviction, to suspend furnishing or rendering to Tenant any overtime
Building services or labor, materials or other property or services for which
Tenant is obligated to pay a separate charge under this Lease (excluding
electricity, water and HVAC), in the event that (but only for so long as) Tenant
is in arrears in paying Landlord for such items for more than 5 days after
notice from Landlord to Tenant demanding the payment of such arrears.
ARTICLE 21
LANDLORD'S RIGHT TO CURE: REIMBURSEMENT
Section 21.1 LANDLORD'S RIGHT TO CURE. If Tenant defaults in the
performance of any of its obligations under this Lease, Landlord, without
thereby waiving such default, may perform such obligation for the account and at
the expense of Tenant: (i) immediately or at any time thereafter, and without
notice,
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in the case of emergency or in case the default (A) materially interferes with
the use by any other tenant of any space in the Building, (B) materially
interferes with the efficient operation of the Building, (C) will result in a
violation of any Requirement, (D) will result in a default under any Mortgage or
Superior Lease, or (E) will result in a cancellation of any insurance policy
maintained by Landlord, and (ii) in any other case if such default continues
after more than 10 days from the date Landlord gives notice of Landlord's
intention so to perform the defaulted obligation. All costs and expenses
incurred by Landlord in connection with any such performance by it for the
account of Tenant and all costs and expenses, including reasonable counsel fees
and disbursements, incurred by Landlord in any action or proceeding (including
any summary dispossess proceeding) brought by Landlord to enforce any obligation
of Tenant under this Lease and/or right of Landlord in or to the Premises, shall
be paid by Tenant to Landlord on demand, with interest thereon at the Interest
Rate from the date incurred by Landlord. Except as expressly provided to the
contrary in this Lease, all costs and expenses which, pursuant to this Lease
(including the Rules and Regulations) are incurred by Landlord and payable to
Landlord by Tenant, and all charges, amounts and sums payable to Landlord by
Tenant for any property, material, labor, utility or other services which,
pursuant to this Lease or at the request and for the account of Tenant, are
provided, furnished or rendered by Landlord, shall become due and payable by
Tenant to Landlord in accordance with the terms of the bills rendered by
Landlord to Tenant.
Section 21.2 REIMBURSEMENT FOR TENANT'S DEFAULT. Tenant shall reimburse
Landlord, within 5 days after demand, for all expenditures made by, or damages,
costs or fines sustained or incurred by, Landlord due to any default by Tenant
under this Lease, with interest thereon at the Interest Rate, from the date such
expenditures were made, or damages, costs or fines incurred, until the date
reimbursed by Tenant.
ARTICLE 22
NO REPRESENTATIONS BY LANDLORD; LANDLORD'S APPROVAL
Section 22.1 NO REPRESENTATIONS. Except as expressly set forth herein,
Landlord and Landlord's agents have made no warranties, representations,
statements or promises with respect to (i) the rentable and usable areas of the
Premises, the Building or the Center, (ii) the amount of any current or future
Operating Expenses or Taxes, (iii) the compliance with applicable Requirements
of the Premises, the Building or the Center, or (iv) the suitability of the
Premises for any particular use or purpose. No rights, easements or licenses are
acquired by Tenant under this Lease, by implication or otherwise. Tenant is
entering into this Lease after full investigation, and is not relying upon any
statement or representation made by Landlord not embodied in this Lease.
Section 22.2 WRITTEN APPROVAL. All references in this Lease to the
consent or approval of Landlord mean the written consent or approval of
Landlord, duly executed by Landlord. All consents or approvals of Landlord may
be granted or withheld in Landlord's sole discretion unless specifically
provided to the contrary in this Lease.
Section 22.3 NO MONEY DAMAGES. Wherever in this Lease Landlord's consent
or approval is required, if Landlord refuses to grant such consent or approval,
whether or not Landlord expressly agreed that such consent or approval would not
be unreasonably withheld, Tenant shall not make, and Tenant hereby waives, any
claim for money damages (including any claim by way of set-off, counterclaim or
defense) based upon Tenant's claim or assertion that Landlord unreasonably
withheld or delayed its consent or approval. Tenant's sole remedy shall be an
action or proceeding to enforce such provision, by specific performance,
injunction or declaratory judgment. In no event shall Landlord be liable for,
and Tenant, on behalf of itself and all other Tenant Parties, hereby waives any
claim for, any indirect, consequential or punitive damages, including loss of
profits or business opportunity, arising under or in connection with this Lease.
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ARTICLE 23
END OF TERM
Section 23.1 EXPIRATION. Upon the expiration or other termination of
this Lease, Tenant shall quit and surrender the Premises to Landlord, vacant,
broom clean and in good order and condition, ordinary wear and tear and damage
for which Tenant is not responsible under the terms of this Lease excepted, and
Tenant shall remove all of Tenant's Property and Specialty Alterations as may be
required pursuant to Article 5 of this Lease.
Section 23.2 HOLDOVER RENT. Any holding over by Tenant after the
expiration of the Term shall be treated as a tenancy at sufferance, at the Rent
set forth below, and otherwise on the terms and conditions set forth in this
Lease. Landlord and Tenant recognize that the damage to Landlord resulting from
any failure by Tenant to timely surrender possession of the Premises may be
substantial, may exceed the amount of the Rent theretofore payable hereunder,
and will be impossible to accurately measure. Tenant therefore agrees that if
possession of the Premises is not surrendered to Landlord on or before the
Expiration Date or sooner termination of the Term, in addition to any other
rights or remedies Landlord may have hereunder or at law, Tenant shall:
(a) pay to Landlord for each month (or any portion thereof)
during which Tenant holds over in the Premises after the Expiration Date
or sooner termination of the Term, a sum equal to the greater of (i) 2
times the Rent payable under this Lease for the last full calendar month
of the Term, or (ii) 1.5 times the fair market rental value of the
Premises for such month (as reasonably determined by Landlord);
(b) be liable to Landlord for (i) any payment or rent concession
which Landlord may be required to make to any tenant obtained by
Landlord for all or any part of the Premises (a "New Tenant") in order
to induce such New Tenant not to terminate its lease by reason of the
holding-over by Tenant, and (ii) the loss of the benefit of the bargain
if any New Tenant shall terminate its lease by reason of the
holding-over by Tenant; and
(c) indemnify and hold harmless Landlord against all claims for
damages by any New Tenant.
No holding-over by Tenant, nor the payment to Landlord of the amounts specified
above, shall operate to extend the Term hereof. Nothing herein contained shall
be deemed to permit Tenant to retain possession of the Premises after the
Expiration Date or sooner termination of this Lease, and no acceptance by
Landlord of payments from Tenant after the Expiration Date or sooner termination
of the Term shall be deemed to be other than on account of the amount to be paid
by Tenant in accordance with the provisions of this Article.
Section 23.3 WAIVER OF STAY. 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 successor law of like import then in force, in
connection with any holdover summary proceedings which Landlord may institute to
enforce the foregoing provisions of this Article.
ARTICLE 24
NO SURRENDER: NO WAIVER
Section 24.1 NO SURRENDER OR RELEASE. No act or thing done by Landlord
or Landlord's agents or employees during the Term shall be deemed an acceptance
of a surrender of the Premises.
Section 24.2 NO WAIVER. No provision of this Lease shall be deemed to
have been waived by any party unless such waiver is in writing and is signed by
the party against whom such waiver is
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asserted, and any such waiver shall be effective only for the specific purpose
and in the specific instance in which given. The failure of either party to seek
redress for violation of, or to insist upon the strict performance of, any
covenant or condition of this Lease, or any of the Rules and Regulations, shall
not be construed as a waiver or relinquishment for the future performance of
such obligations of this Lease or the Rules and Regulations, 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 any Rent payable pursuant to this Lease or any other sums with
knowledge of the breach of any covenant of this Lease shall not be deemed a
waiver of such breach. No payment by Tenant or receipt by Landlord of a lesser
amount than the monthly Fixed Rent or Additional Rent herein stipulated shall be
deemed to be other than a payment on account of the earliest stipulated Fixed
Rent or Additional Rent, or as Landlord may elect to apply such payment, nor
shall any endorsement or acceptance of any check or other payment in the face of
a statement on such check or any letter accompanying such 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 of such Fixed Rent
or Additional Rent or pursue any other remedy provided in this Lease. The
existence of a right of renewal or extension of this Lease, or the exercise of
such right, shall not limit Landlord's right to terminate this Lease in
accordance with the terms hereof.
ARTICLE 25
WAIVER OF TRIAL BY JURY
Landlord and Tenant hereby waive trial by jury in any action, proceeding
or counterclaim brought by either party against the other on any matters in any
way arising out of or connected with this Lease, the relationship of Landlord
and Tenant, Tenant's use or occupancy of the Premises, or the enforcement of any
remedy under any Requirement. If Landlord commences any summary proceeding
against Tenant, Tenant will not interpose any counterclaim of any nature or
description in any such proceeding (unless failure to impose such counterclaim
would preclude Tenant from asserting in a separate action the claim which is the
subject of such counterclaim), and will not seek to consolidate such proceeding
with any other action which may have been or will be brought in any other court
by Tenant.
ARTICLE 26
ADJACENT EXCAVATION: SHORING
If an excavation shall be made, or shall be authorized to be made, upon
land adjacent to the Real Property, Tenant shall, upon notice, afford to the
Person causing or authorized to cause such excavation a license to enter upon
the Premises for the purpose of doing such work as such person shall deem
necessary to preserve the Building or any other part of the Center from injury
or damage and to support the Building or such part of the Center by proper
foundations. In connection with such license, Tenant shall have no right to
claim any damages or indemnity against Landlord, or diminution or abatement of
Rent, provided that Tenant shall continue to have access to the Premises.
ARTICLE 27
NOTICES
Except as otherwise expressly provided in this Lease, all consents,
notices, demands, requests, approvals or other communications given under this
Lease shall be in writing and shall be deemed sufficiently given or rendered if
delivered by hand (provided a signed receipt is obtained) or if sent by
registered or certified mail (return receipt requested) or by a nationally
recognized overnight delivery service making receipted deliveries, addressed as
follows:
if to Tenant, at Tenant's address set forth on the first page of
this Lease, Attention: Xx. Xxxxxxx Xxxxx, or
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if to Landlord, at Landlord's address set forth on the first
page of this Lease, Attention: Property Manager-630 Fifth Avenue, and
with copies to (A) Office of the Center, 00 Xxxxxxxxxxx Xxxxx, Xxx Xxxx,
Xxx Xxxx 00000, Attention: General Counsel, (B) Office of the Center, 00
Xxxxxxxxxxx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Controller, (C)
Tishman Speyer Properties, L.P., 000 Xxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx
00000, Attention: General Counsel, and (D) any Mortgagee or Lessor which
shall have requested copies of notices, by notice given to Tenant in
accordance with the provisions of this Article at the address designated
by such Mortgagee or Lessor; or
to such other addressees) as either Landlord or Tenant or any Mortgagee or
Lessor may designate as its new addressees) for such purpose by notice given to
the other in accordance with the provisions of this Article. Any such consent,
notice, demand, request or other communication shall be deemed to have been
given on the date of receipted delivery or refusal to accept delivery as
provided in this Article 27, or the date delivery is first attempted but cannot
be made due to a change of address of which no notice was given.
ARTICLE 28
RULES AND REGULATIONS
Tenant and all Tenant Parties shall observe and comply with the Rules
and Regulations, as supplemented or amended from time to time, provided, that in
case of any conflict or inconsistency between the provisions of this Lease and
any of the Rules and Regulations as originally promulgated or as supplemented or
amended from time to time, the provisions of this Lease shall control. Landlord
reserves the right, from time to time, to adopt additional Rules and Regulations
and to amend the Rules and Regulations then in effect. Nothing contained in this
Lease shall impose upon Landlord any obligation to enforce the Rules and
Regulations or terms, covenants or conditions in any other lease against any
other Building tenant, and Landlord shall not be liable to Tenant for violation
of the Rules and Regulations by any other tenant, its employees, agents,
visitors or licensees, Landlord shall not enforce any Rule or Regulation against
Tenant in a discriminatory fashion, except where differing circumstances justify
different treatments.
ARTICLE 29
PARTNERSHIP TENANT
Section 29.1 PARTNERSHIP TENANT. If Tenant, or a permitted assignee of
this Lease pursuant to Article 16, is a partnership, or is comprised of two or
more Persons, individually or as partners of a partnership (any such partnership
and such Persons are referred to in this Article 29 as "Partnership Tenant"),
the following shall apply: (i) the liability of each of the general partners
(excluding Persons solely holding interests as limited partners), each of the
partners in a limited liability partnership or Persons comprising Partnership
Tenant (the "Partners") shall be joint and several; (ii) each of the Partners
hereby consents in advance to, and agrees to be bound by, any written instrument
which may hereafter be executed by Partnership Tenant or any of the Partners,
which shall modify, extend or discharge this Lease, in whole or in part, or
surrender all or any part of the Premises to Landlord; (iii) any bills,
statements, notices, demands, requests or other communications given or rendered
to Partnership Tenant or to any of the Partners shall be binding upon
Partnership Tenant and all of the Partners; (iv) if Partnership Tenant shall
admit new Partners, all new Partners shall, by their admission to Partnership
Tenant, be deemed to have assumed joint and several liability for the
performance of all of the terms, covenants and conditions of this Lease on
Tenant's part to be observed and performed; (v) Partnership Tenant shall give
prompt notice to Landlord of the admission of any new Partners, and upon demand
of Landlord, shall cause each new Partner to execute and deliver to Landlord an
agreement in form and substance satisfactory to Landlord, wherein each new
Partner shall assume joint and several liability for the performance of all the
terms, covenants and conditions of this Lease on Tenant's part to be observed
and performed (but neither Landlord's failure to request any such agreement nor
the failure of any new Partner to execute or deliver any such agreement to
Landlord shall vitiate the provisions of this Section
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29.1); and (vi) no change in the Partners of Partnership Tenant resulting from
the admission of a new Partner, or the death, retirement or withdrawal of a
Partner shall release Partnership Tenant or any Partner or former Partner from
their obligations under this Lease.
Section 29.2 CHANGE OF PARTNERS. If Tenant is a Partnership Tenant, (i)
the admission of new Partners, the withdrawal (in the ordinary course of
business), retirement, death, incompetency or bankruptcy of any Partner, or the
reallocation of partnership interests among the Partners shall constitute an
assignment of this Lease unless Partners holding in the aggregate not less than
80% of the partnership interests in Partnership Tenant immediately prior to such
event remain as Partners holding not less than 80% of the partnership interests
in Partnership Tenant during the 12 month period immediately following such
event (i.e., the transfer, by any of the foregoing means, of more than 20% of
the partnership interests in Partnership Tenant in any consecutive 12 month
period shall constitute an assignment of this Lease subject to the provisions of
Article 16), and (ii) the reorganization of Partnership Tenant into a
professional corporation or a limited liability partnership, or the
reorganization of Tenant from a professional corporation or a limited liability
partnership into a partnership, shall constitute an assignment of this Lease,
unless immediately following such reorganization the Partners or shareholders,
as the case may be, of Tenant shall be the same as those existing immediately
prior to such reorganization, and shall acknowledge in writing to Landlord that
they shall remain fully liable, jointly and severally, under this Lease as
provided in this Article 29. If Tenant shall become a professional corporation,
each individual shareholder, shareholder-employee, new individual shareholder
and new shareholder-employee of any professional corporation which is a
shareholder in Tenant shall have the same personal liability (if any) as such
individual or shareholder-employee would have under this Lease if Tenant were a
partnership and such individual or shareholder-employee were a Partner or
admitted as a new Partner. If any individual Partner in Tenant is or becomes a
shareholder-employee of a professional corporation, such individual shall have
the same personal liability under this Lease as such individual would have if he
and not the professional corporation were a Partner of Tenant. If Tenant shall
become a limited liability partnership, (A) each Partner therein shall continue
to have the same personal liability as such Partner had under this Lease prior
to Tenant becoming a limited liability partnership, and (B) each new partner
admitted to such limited liability partnership shall be bound by the provisions
of Section 29.1, and shall execute and deliver to Landlord the assumption
agreement required pursuant to Section 29.1(v) hereof.
ARTICLE 30
VAULT SPACE
Notwithstanding anything contained in this Lease or indicated on any
sketch, blueprint or plan, no vaults, vault space or other space outside the
boundaries of the Real Property are included in the Premises. Landlord makes no
representation as to the location of the boundaries of the Real Property. All
vaults and vault space and all other space outside the boundaries of the Real
Property which Tenant may be permitted to use or occupy are to be used or
occupied under a revocable license. If any such license shall be revoked, or if
the amount of such space shall be diminished as required by any Governmental
Authority or by any public utility company, such revocation, diminution or
requisition shall not (i) constitute an actual or constructive eviction, in
whole or in part, (ii) entitle Tenant to any abatement or diminution of Rent,
(iii) relieve Tenant from any of its obligations under this Lease, or (iv)
impose any liability upon Landlord. Any fee, tax or charge imposed by any
Governmental Authority for any such vaults, vault space or other space occupied
by Tenant shall be paid by Tenant.
ARTICLE 31
LANDLORD'S AGENT
Section 31.1 BROKERS. Landlord has retained Landlord's Agent as leasing
agent in connection with this Lease and Landlord shall be solely responsible for
any fee that may be payable to Landlord's Agent pursuant to a separate
agreement. Each of Landlord and Tenant represents and warrants to the other that
it has not dealt with any other brokers in connection with this Lease other than
Landlord's Agent
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and Tenant's Agent and that to the best of its knowledge and belief, no other
broker, finder or like entity procured or negotiated this Lease or is entitled
to any fee or commission in connection herewith. Each of Landlord and Tenant
shall indemnify, defend, protect and hold the other party harmless from and
against any and all Losses which the indemnified party may incur by reason of
any claim of or liability to any broker, finder or like agent (other than
Landlord's Agent and Tenant's Agent) arising out of any dealings claimed to have
occurred between the indemnifying party and the claimant in connection with this
Lease, or the above representation being false.
Section 31.2 AGENT. Unless Landlord shall render notice to Tenant to the
contrary, Tishman Speyer Properties, L.P. is authorized to act as Landlord's
agent in connection with the performance of this Lease, and Tenant shall direct
all correspondence and requests to, and shall be entitled to rely upon
correspondence received from, Tishman Speyer Properties, L.P., as agent for
Landlord in accordance with Article 27. Tenant acknowledges that Tishman Speyer
Properties, L.P. is acting solely as agent for Landlord in connection with the
foregoing; and neither Tishman Speyer Properties, L.P. nor any of its direct or
indirect partners, officers, shareholders, directors, employees, principals,
agents or representatives shall have any liability to Tenant in connection with
this Lease, and Tenant waives any and all claims against any and all of such
parties arising out of, or in any way connected with, this Lease, the Building
or the Center.
ARTICLE 32
INDEMNITY
Section 32.1 (a) TENANT'S INDEMNITY. Tenant shall not do or permit to be
done any act or thing upon the Premises, the Building or the Center which may
subject Landlord to any liability or responsibility for injury, damages to
persons or property or to any liability by reason of any violation of any
Requirement, and shall exercise such control over the Premises as to fully
protect the Indemnitees against any such liability. Tenant shall indemnify,
defend, protect and hold harmless each of the Indemnitees from and against any
and all Losses to which any Indemnitee may (except to the extent arising from
the gross negligence or willful misconduct of any such Indemnitee in the
operation and maintenance of the Building) be subject or suffer, whether by
reason of, or by reason of any claim for, any injury to, or death of, any person
or persons or damage to property (including any loss of use thereof) or
otherwise arising from or in connection with the use of, or from any work or
thing whatsoever done in, any part of the Premises (other than by such
Indemnitee) or by any Tenant Party in the Center, during the Term or during the
period of time, if any, prior to the commencement or following the expiration of
the Term that any Tenant Party may have been given access to any portion of the
Premises for the purpose of performing work or otherwise, or as a result of any
Tenant Party performing any such work or otherwise that subjects any Indemnitee
to any Requirement to which such Indemnitee would not otherwise be subject, or
arising from any condition of the Premises due to or resulting from any default
by Tenant in the keeping, observance or performance of any provision contained
in this Lease or from any act or negligence of any Tenant Party.
(b) LANDLORD'S INDEMNITY. Landlord shall indemnify, defend and hold
Tenant harmless from and against all losses incurred by Tenant (except insofar
as it arises out of the negligence or willful misconduct of Tenant or any Tenant
Party) arising from any accident, injury or damage whatsoever caused to any
person or the property of any person in or about the common or public areas of
the Building (specifically excluding the Premises), to the extent attributable
to the gross negligence or willful misconduct of Landlord or its agents or
employees.
(c) INDEMNITY INCLUSIONS. As used in this Lease, the term "Losses" means
any and all losses, liabilities, damages, claims, judgments, fines, suits,
demands, costs, interest and expenses of any kind or nature (including
reasonable attorneys' fees and disbursements) incurred in connection with any
claim, proceeding or judgment and the defense thereof, and including all costs
of repairing any damage to the Premises, the Building or the Center, or the
appurtenances of any of the foregoing, to which a particular indemnity and hold
harmless agreement applies.
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Section 32.2 DEFENSE AND SETTLEMENT. If any claim, action or proceeding
is made or brought against any party entitled to indemnification hereunder,
then, upon demand by the indemnified party, the indemnifying party, at its sole
cost and expense, shall resist or defend such claim, action or proceeding in the
indemnified party's name (if necessary), by attorneys approved by the
indemnified party, which approval shall not be unreasonably withheld. Attorneys
for the indemnifying party's insurer shall hereby be deemed approved for
purposes of this Section 32.2. Notwithstanding the foregoing, an indemnified
party may retain its own attorneys to participate or assist in defending any
claim, action or proceeding involving potential liability of $5,000,000 or more,
provided that the indemnifying party shall control the defense and the
indemnifying party shall pay the reasonable fees and disbursements of such
attorneys. Notwithstanding anything herein contained to the contrary, the
indemnifying party may direct the indemnified party to settle any claim, suit or
other proceeding provided that (i) such settlement shall involve no obligation
on the part of the indemnified party other
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than the payment of money, (ii) any payments to be made pursuant to such
settlement shall be paid in full exclusively by the indemnifying party at the
time such settlement is reached, (iii) such settlement shall not require the
indemnified party to admit any liability or wrongdoing, and (iv) the indemnified
party shall have received an unconditional release from the other parties to
such claim, suit or other proceeding.
ARTICLE 33
TAX STATUS OF BENEFICIAL OWNERS
Tenant recognizes and acknowledges that Landlord and/or certain
beneficial owners of Landlord may from time to time qualify as real estate
investment trusts pursuant to Sections 856 et seq. of the Code or as entities
described in Section 511(a)(2) of the Code, and that avoiding (i) the loss of
such status, (ii) the receipt of any income derived under any provision of this
Lease that does not constitute "rents from real property" (in the case of real
estate investment trusts) or that constitutes "unrelated business taxable
income" (in the case of entities described in Section 511(a)(2) of the Code),
and (iii) the imposition of penalty or similar taxes (each, an "Adverse Event")
is of material concern to Landlord and such beneficial owners and Tenant's
agreement herein contained regarding the avoidance of an Adverse Event is a
material inducement to Landlord entering into this Lease. In the event that this
Lease or any document contemplated hereby could, in the opinion of counsel to
Landlord, result in or cause an Adverse Event, Tenant agrees to cooperate with
Landlord in amending or modifying this Lease or such documents and shall at the
request of Landlord execute and deliver such documents reasonably required to
effect such amendment or modification. Any amendment or modification pursuant to
this Article 33 shall be structured so that the economic results to Landlord and
Tenant shall be substantially similar to those set forth in this Lease without
regard to such amendment or modification. Without limiting any of Landlord's
other rights under this Article 33, Landlord may waive the receipt of any amount
payable to Landlord under this Lease, and such waiver shall constitute an
amendment or modification of this Lease with respect to such payment.
ARTICLE 34
SECURITY DEPOSIT
Section 34.1 SECURITY DEPOSIT. Tenant shall deposit the Security Deposit
with Landlord upon the execution of this Lease in cash as security for the
faithful performance and observance by Tenant of the terms, covenants and
conditions of this Lease, including the surrender of possession of the Premises
to Landlord as herein provided.
Section 34.2 LETTER OF CREDIT. In lieu of a cash deposit, Tenant may
deliver the Security Deposit to Landlord in the form of a clean, irrevocable,
non-documentary and unconditional letter of credit in the amount of the Security
Deposit (the "Letter of Credit"), in the form attached hereto as Exhibit I,
issued by and drawable upon a commercial bank, trust company, national banking
association or savings and loan association with offices for banking and drawing
purposes in the City of New York (the "Issuing Bank"), which has outstanding
unsecured, uninsured and unguaranteed indebtedness, or shall have issued a
letter of credit or other credit facility that constitutes the primary security
for any outstanding indebtedness (which is otherwise uninsured and
unguaranteed), that is then rated, without regard to qualification of such
rating by symbols such as `+' or "-" or numerical notation, "Aa" or better by
Xxxxx'x Investors Service and "AA" or better by Standard & Poor's Ratings
Service (and is not on credit-watch with negative implications), and has
combined capital, surplus and undivided profits of not less than $500,000,000.
The Letter of Credit shall (i) name Landlord as beneficiary, (ii) be in the
amount of the Security Deposit, (iii) have a term of 1 year, (iv) permit
multiple drawings, (v) be fully transferable by Landlord without the payment of
any fees or charges, and (vi) otherwise be in form and content satisfactory to
Landlord; provided, however, that Landlord shall in no event be obligated to
accept a Letter of Credit for any amount less than $25,000. If upon any transfer
of the Letter of Credit, any fees or charges shall be so imposed, then such fees
or charges shall be payable solely by Tenant and the Letter of Credit shall so
specify. The Letter of Credit shall provide that it shall be deemed
automatically renewed, without amendment, for consecutive periods of 1 year each
thereafter during the Term through the date that is at least 60 days after the
Expiration Date, unless the Issuing Bank sends a notice (the "Non-Renewal
Notice") to Landlord by certified mail, return receipt requested, not less than
30 days prior to the then-
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current expiration date of the Letter of Credit, stating that the Issuing Bank
has elected not to renew the Letter of Credit. Unless Tenant delivers a
replacement Letter of Credit which satisfies the conditions of this Article 34
within 10 days after Landlord receives a Non-Renewal Notice, then at any time
after the expiration of such 10 day period Landlord shall have the right to draw
the full amount of the Letter of Credit, by sight draft on the Issuing Bank, and
shall thereafter hold or apply the cash proceeds of the Letter of Credit
pursuant to the terms of this Article 34. The Letter of Credit shall state that
drafts drawn under and in compliance with the terms of the Letter of Credit will
be duly honored upon presentation to the Issuing Bank at an office location in
New York City. The Letter of Credit shall be subject in all respects to the
Uniform Customs and Practice for Documentary Credits (1993 revision),
International Chamber of Commerce Publication No. 500.
Section 34.3 APPLICATION OF SECURITY. If Tenant defaults in the payment
or performance of any the terms, covenants or conditions of this Lease,
including the payment of Rent, Landlord may use, apply or retain the whole or
any part of the cash Security Deposit or may notify the Issuing Bank and
thereupon receive all or a portion of the Security Deposit represented by the
Letter of Credit, and use, apply, or retain the whole or any part of such
proceeds, as the case may be, to the extent required for the payment of any Rent
or any other sum as to which Tenant is in default, including (i) any sum which
Landlord may expend or may be required to expend by reason of Tenant's default,
and (ii) any damages or Deficiency to which Landlord is entitled pursuant to
this Lease or applicable Requirements, whether such damages or Deficiency
accrues
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before or after summary proceedings or other reentry by Landlord. If Landlord
uses, applies or retains any part of the Security Deposit, Tenant, upon demand,
shall deposit with Landlord the amount so applied or retained so that Landlord
shall have the full Security Deposit on hand at all times during the Term. If
Tenant shall fully and faithfully comply with all of the terms, covenants and
conditions of this Lease, the Security Deposit (or so much thereof as remains,
if any) shall be returned to Tenant after the Expiration Date and after delivery
of possession of the Premises to Landlord in the manner required by this Lease.
Tenant expressly agrees that Tenant shall have no right to apply any portion of
the Security Deposit against any of Tenant's obligations to pay Rent hereunder.
Section 34.4 TRANSFER. Upon a sale of the Building or the Real Property
or a leasing of the Building, or any financing of Landlord's interest therein,
Landlord shall have the right to transfer the Security Deposit or the Letter of
Credit, as applicable, to the vendee, lessee or lender. With respect to the
Letter of Credit, within 10 days after notice from Landlord of any such
anticipated sale, leasing or financing, Tenant, at its sole cost, shall arrange
for the transfer of the Letter of Credit to the new landlord or lender, as
designated by Landlord in the foregoing notice, or to have the Letter of Credit
reissued in the name of the new landlord or lender. From and after any such
sale, financing or leasing, Tenant shall look solely to the new landlord or
lender for the return of such Security Deposit or Letter of Credit and Landlord
shall have no further liabilities or obligations in connection therewith. The
provisions of this Section 34.4 shall apply to each and every transfer or
assignment made of the Security Deposit to a new landlord or lender. Tenant will
not assign, transfer, pledge or encumber, or attempt to assign, transfer, pledge
or encumber, the Security Deposit or Letter of Credit, and neither Landlord nor
its successors or assigns as the holders of the Security Deposit or the Letter
of Credit shall be bound by any such actual or attempted assignment or
encumbrance.
Section 34.5 REPLACEMENT LETTER OF CREDIT. For purposes hereof, the
"Letter of Credit Amount" shall be defined as follows: (i) during the period
from the Commencement Date through the 4th anniversary of the Rent Commencement
Date, the Letter of Credit Amount shall be Four Million and 00/100 Dollars
($4,000,000.00); (ii) during the period from the 4th anniversary of the Rent
Commencement Date through the last day immediately preceding the 5th anniversary
of the Rent Commencement Date, the Letter of Credit Amount shall be Three
Million and 00/100 Dollars ($3,000,000.00); and (iii) during the period from the
5th anniversary of the Rent Commencement Date through the 6th anniversary of the
Rent Commencement Date, the Letter of Credit Amount shall be Two Million and
00/100 Dollars ($2,000,000.00).
Provided that no Event of Default has occurred hereunder, commencing
with the 4th anniversary of the Rent Commencement Date, concurrent with the
expiration of any of the foregoing periods, Tenant may elect to replace the
Letter of Credit with a substitute Letter of Credit (the "Substitute Letter of
Credit"), which Substitute Letter of Credit shall be in the amount of the Letter
of Credit Amount which is applicable during the respective period, and shall in
all respects comply with the provisions of this Article 34. Such Substitute
Letter of Credit shall be delivered to Landlord on or before the date which is
30 days prior to the then-current expiration date of the Letter of Credit. Upon
delivery of the Substitute Letter of Credit by Tenant, (i) the Substitute Letter
of Credit shall be deemed to be the "Letter of Credit" for all purposes under
this Lease, and (ii) the existing Letter of Credit shall be returned by Landlord
to Tenant. In the event that Tenant fails timely to deliver to Landlord a
Substitute Letter of Credit, then Landlord may elect, at any time thereafter, to
draw down the then-outstanding Letter of Credit and to hold the proceeds thereof
in accordance with the provisions of this Article 34. To the extent that
Landlord has not previously drawn down the Letter of Credit or applied the
proceeds thereof, and provided that no Event of Default has occurred under this
Lease, then upon Tenant's request therefor, the amount of such proceeds in
excess of the then-applicable Letter of Credit Amount shall be returned to
Tenant by Landlord. To the extent that Landlord has not previously drawn upon
any Letter of Credit held by Landlord, and provided that no Event of Default has
occurred under this Lease, then after the sixth anniversary of the Rent
Commencement Date, promptly after receipt of Tenant's request therefor, the
then-outstanding Letter of Credit shall be returned to Tenant by Landlord.
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ARTICLE 35
MISCELLANEOUS
Section 35.1 DELIVERY. The submission of this document for examination
and negotiation does not constitute an offer to lease, or a reservation of, or
option for, the Premises, and this Lease shall not be binding upon Landlord or
Tenant unless and until Landlord shall have executed and delivered a fully
executed copy of this Lease to Tenant.
Section 35.2 TRANSFER OF REAL PROPERTY. Landlord's obligations under
this Lease shall not be binding upon Landlord named herein after the sale,
conveyance, assignment, transfer or lease of Landlord's interest (collectively,
a "Transfer") by Landlord (or upon any subsequent landlord after the Transfer by
such subsequent landlord) of its interest in the Building or the Real Property,
as the case may be, and in the event of any such Transfer, Landlord (and any
such subsequent landlord) shall be entirely freed and relieved of all covenants
and obligations of Landlord hereunder, and the transferee of Landlord's interest
(or that of such subsequent landlord) in the Building or the Real Property, as
the case may be, shall be deemed to have assumed all obligations under this
Lease.
Section 35.3 LIMITATION ON LIABILITY. The liability of Landlord for
Landlord's obligations under this Lease shall be limited to Landlord's interest
from time to time in the Real Property and Tenant shall not look to any other
property or assets of Landlord or the property or assets of any of the
Indemnitees in seeking either to enforce Landlord's obligations under this Lease
or to satisfy a judgment for Landlord's failure to perform such obligations; and
none of the Indemnitees shall be personally liable for the performance of
Landlord's obligations under this Lease.
Section 35.4 RENT. Notwithstanding anything to the contrary contained in
this Lease, all amounts payable by Tenant to or on behalf of Landlord under this
Lease, whether or not expressly denominated Fixed Rent, Tenant's Tax Payment,
Tenant's Operating Payment, Additional Rent or Rent, shall constitute rent for
the purposes of Section 502(b)(6) of the United States Bankruptcy Code and other
Requirements.
Section 35.5 ENTIRE AGREEMENT. This Lease (including any Schedules and
Exhibits referred to herein and all supplementary agreements provided for
herein) contains the entire agreement between the parties and all prior
negotiations and agreements are merged into this Lease. All of the Schedules and
Exhibits attached hereto are incorporated in and made a part of this Lease,
provided that, in the event of any inconsistency between the terms and
provisions of this Lease and the terms and provisions of the Schedules and
Exhibits hereto, the terms and provisions of this Lease shall control. All
Article and Section references set forth herein shall, unless the context
otherwise requires, be deemed references to the Articles and Sections of this
Lease.
Section 35.6 GOVERNING LAW. This Lease shall be governed in all respects
by the laws of the State of New York.
Section 35.7 PARTIAL UNENFORCEABILITY. If any provision of this Lease,
or its application to any Person or circumstance, shall ever be held to be
invalid or unenforceable, then in each such event the remainder of this Lease or
the application of such provision to any other Person or any other circumstance
(other than those as to which it shall be invalid or unenforceable) shall not be
thereby affected, and each provision hereof shall remain valid and enforceable
to the fullest extent permitted by law.
Section 35.8 CONSENT TO JURISDICTION. (a) Tenant agrees that all
disputes arising, directly or indirectly, out of or relating to this Lease, and
all actions to enforce this Lease, shall be dealt with and adjudicated in the
state courts of the State of New York or the federal courts for the Southern
District of New York; and for that purpose Tenant expressly and irrevocably
submits itself to the jurisdiction of such courts. Tenant agrees that so far as
is permitted under applicable law, this consent to personal jurisdiction shall
be self-operative and no further instrument or action, other than service of
process in one of the manners specified in this Lease, or as otherwise permitted
by law, shall be necessary in order to
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confer jurisdiction upon it in any such court. Tenant further agrees that
judgment against it in any such action or proceeding shall be conclusive and, to
the extent permitted by applicable law, may be enforced in any other
jurisdiction within or outside the United States of America by suit on the
judgment, a certified or exemplified copy of which shall be conclusive evidence
of the fact and of the amount of its indebtedness.
(b) To the extent that Tenant has or hereafter may acquire any
immunity from jurisdiction of any court or from any legal process (whether
through service or notice, attachment prior to judgment, attachment in aid of
execution, execution or otherwise) with respect to itself or its property,
Tenant irrevocably waives such immunity in respect of its obligations under this
Lease.
Section 35.9 SURVIVAL. All obligations and liabilities of Landlord or
Tenant to the other which accrued before the expiration or other termination of
this Lease, and all such obligations and liabilities which by their nature or
under the circumstances can only be, or by the provisions of this Lease may be,
performed after such expiration or other termination, shall survive the
expiration or other termination of this Lease. Without limiting the generality
of the foregoing, the rights and obligations of the parties with respect to any
indemnity under this Lease, and with respect to Fixed Rent, Tenant's Tax
Payment, Tenant's Operating Payment, Additional Rent, and any other amounts
payable under this Lease, shall survive the expiration or other termination of
this Lease.
Section 35.10 ESTOPPELS. Within 7 days following request from Landlord,
any Mortgagee or any Lessor, Tenant shall deliver to Landlord a statement
executed and acknowledged by Tenant, in form satisfactory to Landlord, (i)
stating the Commencement Date, the Rent Commencement Date and the Expiration
Date, and that this Lease is then in full force and effect and has not been
modified (or if modified, setting forth all modifications), (ii) setting forth
the date to which Fixed Rent and any Additional Rent have been paid, together
with the amount of monthly Fixed Rent, Tenant's Tax Payment and Tenant's
Operating Payment then payable, (iii) stating whether or not, to the best of
Tenant's knowledge, Landlord is in default under this Lease, and, if Tenant
asserts that Landlord is in default, setting forth the specific nature of any
such defaults, (iv) stating whether Landlord has failed to complete any work
required to be performed by Landlord under this Lease, (v) stating whether there
are any sums payable to Tenant by Landlord under this Lease, (vi) stating the
amount of the Security Deposit, if any, under this Lease, (vii) stating whether
there are any subleases affecting the Premises, (viii) stating the address of
Tenant to which all notices and communications under this Lease shall be sent,
and (ix) responding to any other matters reasonably requested by Landlord, such
Mortgagee or such Lessor. Tenant acknowledges that any statement delivered
pursuant to this Section 35.10 may be relied upon by any purchaser or owner of
the Real Property or the Building, or all or any portion of Landlord's interest
in the Real Property or the Building or under any Superior Lease, or by any
Mortgagee or assignee thereof, or by any Lessor or assignee thereof.
Section 35.11 CERTAIN RULES OF INTERPRETATION. For purposes of this
Lease, whenever the words "include", "includes", or "including" are used, they
shall be deemed to be followed by the words "without limitation", and, whenever
the circumstances or the context requires, the singular shall be construed as
the plural, the masculine shall be construed as the feminine and/or the neuter
and vice versa. This Lease shall be interpreted and enforced without the aid of
any canon, custom or rule of law requiring or suggesting construction against
the party drafting or causing the drafting of the provision in question.
Section 35.12 CAPTIONS. The captions and paragraph headings in this
Lease are inserted only as a matter of convenience and for reference and in no
way define, limit or describe the scope of this Lease or the intent of any
provision hereof.
Section 35.13 PARTIES BOUND. The terms, covenants, conditions and
agreements contained in this Lease shall bind and inure to the benefit of
Landlord and Tenant and, except as otherwise provided in this Lease, to their
respective legal representatives, successors, and assigns. Each and every
provision of this Lease to be performed by Tenant shall be construed to be both
a covenant and a condition.
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Section 35.14 MEMORANDUM OF LEASE. This Lease shall not be recorded;
however, at Landlord's request, Landlord and Tenant shall promptly execute,
acknowledge and deliver a memorandum of this Lease in form suitable for
recording, together with such customary Xxx Xxxx Xxxx xxx Xxx Xxxx Xxxxx real
property transfer tax forms and affidavits as are then required for the
recording of such memoranda, and Landlord may thereupon record such memorandum.
Upon the expiration or sooner termination of the Term, Tenant shall execute and
deliver to Landlord such customary documents and instruments, in form suitable
for recording, as Landlord shall reasonably request to evidence the termination
of such memorandum of lease.
Section 35.15 COUNTERPARTS. This Lease may be executed in duplicate
counterparts, each of which shall be deemed an original and all of which, when
taken together, shall constitute one and the same instrument.
ARTICLE 36
USE OF PREMISES
Section 36.1 GENERAL STANDARDS. Tenant covenants and agrees that the
Premises during the Term shall be used and occupied by Tenant only for the
Permitted Uses and no other purpose or purposes. Without limitation, Tenant
shall conduct its business in the Premises in a first-class, reputable manner,
consistent with first-class health-club facilities operated from time to time in
the borough of Manhattan.
Section 36.2 SPECIFIC OPERATING COVENANTS. Tenant further covenants and
agrees that it will, at its sole cost and expense:
(a) Occupy and commence the operation of its business in each
Portion of the Premises as soon after the respective delivery date of that
Portion of the Premises as possible, but in no event later than the Rent
Commencement Date occurs.
(b) Excepting only on Christmas Day, New Years Day and
Thanksgiving Day, keep the Premises open for business at least during the
following (the "Operating Hours"): (i) Monday through Friday for 12 consecutive
hours, and (ii) on Saturdays and Sundays for 8 consecutive hours, but in no
event a greater number of hours than are permitted by applicable Requirements.
(c) Throughout the Term, incident to the Permitted Uses,
maintain and operate a cafe substantially similar to the cafe operation operated
on the date of this Lease located in the facility known as "The Reebok Sports
Club" located at 000 Xxxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx; provided, however,
that said cafe shall be private (i.e. not open to the public and providing food
only to Tenant's members). In addition, notwithstanding the foregoing or any
other provisions of this Lease, Tenant shall not operate, or permit the
operation of, a restaurant in the Premises.
(d) Clean the windows and doors (including, in each case, the
frames thereof) in the Premises and in the perimeter walls thereof whenever
necessary, in Landlord's reasonable judgment. Tenant will not require, permit,
suffer or allow any such window or door to be cleaned in violation of any
applicable Requirements.
(e) Keep the Premises clean; keep all toilets and locker rooms
clean and sanitary; not permit garbage or waste materials to accumulate or
become a nuisance; seal all refuse in plastic bags of adequate strength and
size; maintain all garbage dumpsters in a clean and sanitary condition; remove
all rubbish and other debris from the Premises to such location as may be
specified by Landlord from time to time and under conditions approved by
Landlord.
(f) Keep all glass in the Premises and in the perimeter walls
thereof, the frames for such glass, and any lettering and ornamentation on such
glass insured against damage (including temporary repairs) for the benefit of
Landlord for the full replacement value thereof. Such insurance shall
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be effected, at the option of Landlord, either by Tenant paying to Landlord a
proportionate share of the premium incurred by Landlord for a blanket
comprehensive glass policy for the Building or the Center, or by Tenant
furnishing Landlord with a separate policy or policies for such glass insurance,
in such form and placed with such underwriters as may be approved by Landlord.
In the event Landlord elects to obtain such insurance, then upon Tenant's
payment of its proportionate share of Landlord's blanket premium, Landlord will
furnish Tenant with a certificate of such insurance.
(g) Adequately staff the Premises with sufficient employees to
conduct its business in a first-class, reputable manner.
(h) Install blinds, curtains, shades or other window treatments
on the windows and doors of the Premises. All such blinds, curtains, shades and
window treatments (a) shall be subject to the prior written approval of Landlord
in all respects, and (b) shall be kept closed and lowered at all times.
(i) Not install or place any lettering, sign, advertisement,
decoration, or notice on the windows or doors or on the exterior of the Premises
which is not in each instance (i) approved in writing by Landlord prior to
installation, and (ii) in conformity with Landlord's standard sign and store
front program for the Building, as such program may be modified by Landlord from
time to time by notice to Tenant. Tenant shall remove from the Premises any such
items installed without Landlord's approval, and if Tenant fails to do so
promptly after notice from Landlord, Landlord may perform such work on Tenant's
behalf, and Tenant shall pay all costs and expenses incurred by Landlord in so
doing, as provided in Article 21. On or before the expiration or earlier
termination of this Lease, Tenant shall remove all lettering, signs,
advertisements, decorations, and notices from the Premises.
(j) Not install, place or permit any awning or canopy on the
perimeter walls of the Premises unless provided or approved by Landlord, and if
so provided or approved, keep each such awning clean and in good order, repair
and appearance to Landlord's reasonable satisfaction, including, whenever
necessary in Landlord's reasonable judgment, the replacement of awning coverings
with materials approved by Landlord. Where any such awning has been provided by
Landlord, Landlord will make all repairs and replacements to the framework or
mechanical parts thereof, at Tenant's expense.
(k) Within the Premises, maintain and provide exercise
equipment, fixtures, amenities, appearances, finishes and the like not
materially different from those maintained and provided on the date of this
Lease at the facility known as "The Reebok Sports Club" located at 000 Xxxxxxxx
Xxxxxx, Xxx Xxxx, Xxx Xxxx (excepting only a swimming pool, child care facility,
rock climbing wall, and a so-called "white table cloth" restaurant), but never
less than the exercise equipment, fixtures, amenities, appearances, finishes and
the like as may be added to the foregoing facility from time-to-time during the
Term (excepting only the foregoing facilities). Without limitation, subject to
the prior written consent of Landlord in each instance, such consent not to be
unreasonably withheld, Tenant may from time-to-time add to or remove from the
Premises such services or amenities as may be necessary, in Tenant's reasonable
judgment, to operate a first-class health club facility in the Premises of the
same or better quality as the aforementioned Reebok Sports Club. Further, from
time to time during the Term, Tenant shall redecorate the Premises and refinish,
renew or replace the fixtures, furnishings, decorations and equipment therein as
may be necessary, in Landlord's reasonable judgment, to preserve the good and
first-class appearance of the Premises.
(l) At all times during the Term, keep the lights lit which
illuminate those shop windows of the Premises on the street and mezzanine levels
facing the street during non-daylight hours.
(m) Maintain a contract to have the door and brass signage above
the exterior of the Premises polished semi-annually in a manner satisfactory to
Landlord, submit maintenance records with respect to such metal maintenance to
the Building manager on a semi-annual basis, and make such maintenance records
available for review by the Building manager upon request at all times during
the Term. If Tenant fails comply with the provisions of this Section 36.2(m)
promptly after notice from Landlord, Landlord may perform such work on Tenant's
behalf, and Tenant shall pay all costs and expenses incurred by Landlord in so
doing, as provided in Article 21.
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(n) Provide and maintain in good working order during the Term a
security system adequate to provide reasonable protection to the Premises,
including a 24-hour direct response smoke, fire and burglary alarm system. If
Tenant employs security guards at the Premises, under no circumstances shall
such security guards carry firearms of any kind. Tenant understands that
Landlord will not provide Tenant with any security guards or alarm or security
systems of any kind for nature, and will have no liability or obligation to
Tenant arising from any claims for loss, injury or damage to persons or property
in connection therewith.
(o) As soon as practicable and in any event within 24 hours
after any exterior or interior glass (including mirrors) is broken or cracked,
including any so-called "bulls eye" break in the glass, replace such glass with
glass of the same kind and quality, and repair or replace the frames for such
glass if necessary or desirable in Landlord's reasonable judgment, and if Tenant
fails to do so promptly after notice from Landlord, Landlord may perform such
work on Tenant's behalf, and Tenant shall pay all cost and expenses incurred by
Landlord in so doing, as provided in Article 21.
(p) Not conduct any clearance, "going-out-of-business", auction,
distress, fire or bankruptcy or similar sale in the Premises.
(q) Place no fixtures, furnishings, decorations or equipment
(excepting trade fixtures and athletic equipment) in the Premises at any time
during the Term, without the prior written approval of Landlord in each
instance. Tenant shall remove from the Premises any such items installed without
Landlord's approval, and if Tenant fails to do so promptly after notice from
Landlord, Landlord may perform such work on Tenant's behalf, and Tenant shall
pay all costs and expenses incurred by Landlord in so doing, as provided in
Article 21. On or before the expiration or earlier termination of this Lease in
accordance with the provisions of this Lease, Tenant shall remove all fixtures,
furnishings, decorations and equipment from the Premises.
(r) Not remove any trade fixtures from the Premises without the
prior consent of Landlord in each instance, except that Tenant may remove trade
fixtures as long as Tenant promptly installs replacement trade fixtures at least
equal in quality, value and function to those being removed.
(s) Not (i) place or maintain any merchandise or other articles
in the concourse or in any other area outside of the Premises, or on the
sidewalks, corridors or other common areas of the Center, nor (ii) receive or
ship articles of any kind outside the designated loading areas for the Premises,
nor (iii) permit the parking of vehicles so as to interfere with the use of any
driveway, corridor, footwalk, parking area or other common area of the Center.
(t) Operate the Premises in a manner consistent with its
location in a first class office building including the exercise of methods of
crowd control, security and the prevention of prospective customers congregating
in and about the Premises as may be required by Landlord. Tenant shall take all
necessary steps to prevent prospective customers from entering, using,
congregating in or causing a disturbance in the lobby area of the Building or in
and around the sidewalk area outside of the Building, and Tenant shall cause all
patrons to enter and leave the Premises through the separate exterior door
exclusively serving the Premises, and shall ensure that no lines of patrons form
outside the Premises.
(u) Cause all of its customers, agents, staff and employees, and
all Tenant Parties, to enter and exit the Premises at all times through the
separate exterior door to the Rockefeller Plaza Street, and shall not use or
permit the use of the door from the Premises to the lobby of the Building
excepting only in the event of emergencies. Tenant shall keep such customers,
agents, staff and employees, and all Tenant Parties, from loitering in the
lobbies and other areas of the Building.
(v) Not use, play or operate or permit to be used, played or
operated any sound making or sound reproducing device in the Premises, except in
such manner and under such conditions
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so that no sound shall be heard outside of the Premises, and observe, comply
with and adopt such means and precautions as Landlord may from time to time
request in such connection.
(w) Store or stock in the Premises only such goods, wares and
merchandise as Tenant is permitted to offer for sale, at retail, in or from the
Premises.
(x) Not install or use any lighting equipment in or about the
Premises which is visible from or casts light toward the exterior of the
Premises without the prior written consent of Landlord.
(y) Take all precautions to prevent any odors from emanating
from the Premises, including the installation, as part of the Initial
Installations, of such control devices as shall be prescribed by Landlord, and
the establishment of effective control procedures, to eliminate such odors.
(z) Install and maintain automatic, non-toxic, dry chemical fire
extinguishing devices approved by the Fire Insurance Rating Organization having
jurisdiction over the Premises, and if gas is used in the Premises, suitable gas
cut-off devices (manual and automatic).
(aa) Not use the utility waste lines and plumbing for any
purpose other than for which they were constructed, and not permit any food,
waste or other foreign substances to be thrown or drawn into the pipes. Tenant
shall take all reasonable steps to prevent fat, grease, or any other greasy
substance from entering the utility waste lines and plumbing of the Premises,
including the installation, as part of the Initial Installations, and the
maintenance thereafter, of suitable grease traps in all waste lines (and Tenant
shall clear any blockage in the sewer line or lines servicing the Premises
resulting from Tenant's operations, whether or not in violation of any provision
hereof).
(bb) To the extent that there are stacks, flues and exhausts
servicing the Premises, periodically clean and otherwise maintain the same, as
and when require to minimize the risk of fire and other hazards.
(cc) Cause all of Tenant's waste, trash and rubbish to be
deposited into, and stored in, appropriate containers to be stored within the
Premises in a manner satisfactory to Landlord so that the Premises and the
Building shall be maintained in a clean and slightly condition at all times, and
cause all such waste, trash and rubbish to be regularly carted from the Premises
in a manner satisfactory to Landlord so as to prevent the accumulation of the
same, in accordance with the regulations Governmental Authorities. Tenant shall
not encumber or obstruct, or permit to be encumbered or obstructed, the portion
of the Building or of the sidewalk or street adjacent to or abutting the
Premises. Tenant agrees to use the services of Landlord's independent sanitation
contractor for removal of Tenant's rubbish and refuse from the Premises. Tenant
shall refrigerate all of its food waste and other perishable refuse, at its sole
cost and expense, and comply with all requirements of Governmental Authorities
and Landlord with respect to refrigeration of food waste and/or sorting or
recycling of rubbish and refuse. Tenant shall be required to transport its
rubbish and refuse to Landlord's loading dock in a manner determined by
Landlord, for ultimate removal by Landlord's independent sanitation contractor.
(dd) Not sell or permit the sale of, or permit the consumption
of, alcohol in the Premises or any part thereof.
Section 36.3 NAME OF BUSINESS. Tenant shall always conduct its
operations in the Premises under its present trade name, "Sports Club
Rockefeller Center" or such other trade name as may be approved, in advance, by
Landlord.
Section 36.4 BREACH BY TENANT. Tenant understands and agrees that a
breach by Tenant of any of the provisions of this Article 36 shall be deemed a
material breach of this Lease and considered an Event of Default hereunder.
Tenant acknowledges that damages resulting from any breach of the provisions of
this Article 36 are difficult, if not impossible to ascertain and concedes that,
among other remedies for such breach permitted by law or the provisions of this
Lease, Landlord shall be entitled to enjoin Tenant from any violation hereof.
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ARTICLE 37
RENEWAL OPTIONS
Section 37.1 EXERCISE OF OPTIONS. Subject to the conditions of this
Article 37, Tenant shall have the right, at its sole option, to renew the Term
for all of the Premises for 2 renewal terms (collectively, the "Renewal Terms"
and each a "Renewal Term") of 5 years each, by providing written notice (each, a
"Renewal Notice") delivered to Landlord not less than 12 months prior to the
then-applicable Expiration Date; provided, however, that (a) Tenant shall not be
in default under any of the terms, covenants or conditions of this Lease either
on the date the Renewal Notice is given or on the Renewal Term Commencement Date
(as hereinafter defined), and (b) Tenant shall not have assigned this Lease, or
subleased more than 10% of the rentable area of the Premises (excepting only
pursuant to an assignment which Landlord has consented to in accordance with the
provisions of Section 16.8(a) of this Lease and/or a sublease (or subleases)
which Landlord has consented to under Section 16.13 of this Lease). Upon the
giving of the Renewal Notice, this Lease shall be deemed renewed for the Renewal
Term with the same force and effect as if the Renewal Term had originally been
included in the Term. The first Renewal Term shall commence on the day after the
Expiration Date (a "Renewal Term Commencement Date") and shall terminate on the
day immediately preceding the 5th anniversary of the Expiration Date. The second
Renewal Term shall commence on the date after the expiration of the first
Renewal Term and shall terminate on the 5th anniversary thereof. Tenant shall
have no further option to extend the Term of this Lease other than the 2
five-year terms herein provided. Time is of the essence with respect to the
giving of a Renewal Notice by Tenant.
Section 37.2 TERMS. All of the terms, covenants and conditions of this
Lease shall continue in full force and effect during each Renewal Term, except
that (a) the Fixed Rent for the first Renewal Term shall be payable at a rate of
112% of the Fixed Rent for the last year of the initial Term; (b) the Fixed Rent
for the second Renewal Term shall be in an amount equal to the Fair Market Value
of the Premises (determined as provided in Section 37.3); (c) after the delivery
of the second Renewal Notice, Tenant shall no further right to renew the Term;
(d) the Base Tax Year will be the Tax Year commencing on the July 1st prior to
the Renewal Term Commencement Date; and (e) the Base Operating Year will be the
Computation Year commencing on the January 1st prior to the Renewal Term
Commencement Date. Any termination, cancellation or surrender of the entire
interest of Tenant under this Lease at any time during the Term shall terminate
and extinguish any right of renewal of Tenant hereunder.
Section 37.3 DETERMINATION OF FAIR MARKET VALUE. For purposes of
determining the Fixed Rent payable during the second Renewal Term, the fair
market value of the Premises (the "Fair Market Value") shall be the fair market
annual rental value of the Premises at the commencement of the second Renewal
Term for a term equal to the second Renewal Term, as determined by Landlord
based on comparable space in the Building and in comparable buildings in the
Center, including all of Landlord's services provided for in this Lease and with
the Premises considered (a) as vacant, and (b) in "as is" condition on the
Renewal Term Commencement Date for the second Renewal Term. The calculation of
the Fair Market Value shall also be adjusted to take into account any
construction allowances, work letters, free-rent periods or other inducements as
shall then be prevalent in comparable transactions.
Section 37.4. ARBITRATION. If Tenant shall dispute Landlord's
determination of Fair Market Value pursuant to Section 37.3, Tenant shall give
notice to Landlord of such dispute within 10 days of Tenant's receipt of
Landlord's determination, and such dispute shall be determined by a single
arbitrator appointed in accordance with the American Arbitration Association
Real Estate Valuation Arbitration Proceeding Rules. The arbitrator shall be
impartial and shall have not less than 10 years' experience in the County of New
York in a calling related to the leasing of commercial space in buildings
comparable to the Building, and the fees of the arbitrator shall be shared by
Landlord and Tenant. Within 15 days following the appointment of the arbitrator,
Landlord and Tenant shall attend a hearing before the arbitrator at which each
party shall submit a report setting forth its determination of the Fair Market
Value of the Premises for the Renewal Term, together with such information on
comparable rentals and such other evidence as such party shall deem relevant.
The arbitrator shall, within 30 days following such hearing and
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submission of evidence, render his or her decision by selection the
determination of Fair Market Value submitted by either Landlord or Tenant which,
in the judgment of the arbitrator, most nearly reflects the Fair Market Value of
the Premises for the second Renewal Term. The arbitrator shall have no power or
authority to select any Fair Market Value other than a Fair Market Value
submitted by Landlord or Tenant. Prior to the determination of the arbitrator,
Tenant shall pay Rent in the amount equal to Landlord's determination of Fair
Market Value submitted to Tenant pursuant to Section 37.3, and following the
arbitrator's final determination, the amount of any overpayment or underpayment
shall be adjusted between the parties.
Section 37.5 LEASE AMENDMENT. Notwithstanding the fact that upon
delivery of each Renewal Notice Tenant's exercise of the option to extend the
Term shall be automatic and self-executing, upon request by Landlord made on or
following the Renewal Term Commencement Date, Tenant will execute, acknowledge
and deliver to Landlord an amendment to this Lease setting forth the Renewal
Term Commencement Date, Fixed Rent for the Renewal Term, and the Renewal Term
Expiration Date. The failure of either party to execute and deliver such an
amendment shall not affect the rights or the parties under this Lease.
ARTICLE 38
SPECIAL PROVISION
Notwithstanding anything to the contrary contained herein, provided that
Tenant shall have initially opened for business in the Premises as provided in
this Lease and shall have continuously operated its business therein, without
otherwise being in default hereunder, then at any time after the 5th anniversary
of the date on which Tenant initially opens for business in the Premises, Tenant
shall have the right to cease operating its business in the Premises by
providing not less than 30 days prior notice to Landlord of its intention to do
so. In such event Tenant shall continue to perform all of its other obligations
under this Lease, including the obligation to make payments on account of Rent
hereunder. If Tenant ceases operating its business in the Premises, then at any
time thereafter while such cessation or discontinuance continues, Landlord shall
have the right to terminate this Lease by sending notice to that effect to the
Tenant, and this Lease shall terminate on the 45th day after the giving of such
notice, unless the following conditions are fully and completely satisfied: (i)
within 30 days after Landlord sends said notice to Tenant, Tenant notifies
Landlord of its intention to recommence operating its business in the Premises,
(ii) within 45 days after Landlord sends said notice, Tenant reopens its
business in the Premises and continues to operate its business therein in
accordance with the requirements of this Lease for the remainder of the Term,
and (iii) Tenant shall have no further right under this Article 38 to cease
operating its business in the Premises. In the event that the Landlord exercises
its right to terminate this Lease as set forth above, then Tenant shall
surrender possession of the Premises in accordance with the requirements of this
Lease, this Lease shall be of no further force and effect after the date of
termination, and neither party shall have any further obligations to the other
in connection with this Lease, subject, however, to the payment by Tenant to
Landlord of all sums then due and owing or having accrued to Landlord hereunder.
ARTICLE 39
RGTS AREA
Landlord may elect, at Tenant's cost and expense, to perform or cause to
be performed, any and all work necessary to provide access and egress to and
from the area on the 3rd floor of the Building which is shown on Exhibit A-5 as
RGTS (the "RGTS Area"), which work may include the following (collectively, the
"RGTS Area Access Work"): (i) modification of the existing elevator car(s) and
elevator controls as may be required to limit access to the RGTS Area; (ii)
construction of an opening in the wall of the RGTS Area in order to create
access to the existing stairway located at the western wall of the RGTS Area;
(iii) construction of a new stairway in the location of the existing bathrooms
which are adjacent to the RGTS Area, which stairway will connect the 2nd and 3rd
floors; (iv) creation of an exit passageway to the existing stairway at
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the 2nd floor stair landing; and (v) any and all other work relating to such
access and egress, including the removal and abatement of asbestos, the
relocation of mechanical systems, and the like. Tenant shall reimburse Landlord
for all costs and expenses of every kind, nature and description incurred by
Landlord in connection with the RGTS Area Access Work, including soft costs,
architectural and engineering fees and costs of tenant coordination. Tenant
shall make payments to Landlord on account thereof from time-to-time within not
more than 10 days after Landlord delivers to Tenant an invoice or invoices
therefor. Tenant shall permit Landlord and the tenants and occupants of the RGTS
Area to enter and pass through the Third Floor Premises, at all times, for the
purpose of gaining and maintaining access to and egress from the RGTS Area.
Tenant shall not obstruct or permit the obstruction of said means of access and
egress to and from the RGTS Area, including the elevator doors which open into
the Third Floor Premises.
IN WITNESS WHEREOF, Landlord and Tenant have executed this Lease as of
the day and year first above written.
LANDLORD:
RCPI TRUST
By: Tishman Speyer Properties,
L.P., its Agent
By: /s/ Xxxxxxxx X. Xxxxxxx
---------------------------------
Xxxxxxxx X. Xxxxxxx
TENANT:
SPORTS CLUB COMPANY, INC.
By: /s/ Xxxxx X. Xxxxx
---------------------------------
Name: Xxxxx X. Xxxxx
Title: CEO
Tenant's Federal Identification
Number:
00-0000000
------------------------------------
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