Exhibit 10.34
AGREEMENT OF LEASE
Between
00 XXXXX XXXXXX L.P.,
Owner
and
BOTTOMLINE TECHNOLOGIES, INC.,
Tenant
Premises
Portion Eighth (18/th/) Floor
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New York Information Technology Center
00 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx
Dated May _____________, 2000
TABLE OF CONTENTS
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ARTICLE 1 Demised Premises, Term, Rents
ARTICLE 2 Use and Occupancy
ARTICLE 3 Alterations
ARTICLE 4 Ownership of Improvements
ARTICLE 5 Repairs
ARTICLE 6 Compliance With Laws
ARTICLE 7 Subordination, Attornment, Etc.
ARTICLE 8 Property Loss, Etc.
ARTICLE 9 Destruction-Fire or Other Casualty
ARTICLE 10 Eminent Domain
ARTICLE 11 Assignment and Subletting
ARTICLE 12 Existing Conditions/Present Occupant
ARTICLE 13 Access to Demised Premises
ARTICLE 14 Vault Space
ARTICLE 15 Certificate of Occupancy
ARTICLE 16 Default
ARTICLE 17 Remedies
ARTICLE 18 Damages
ARTICLE 19 Fees and Expenses; Indemnity
ARTICLE 20 Entire Agreement
ARTICLE 21 End of Term
ARTICLE 22 Quiet Enjoyment
ARTICLE 23 Escalation
ARTICLE 24 No Waiver
ARTICLE 25 Mutual Waiver of Trial by Jury
ARTICLE 26 Inability to Perform
ARTICLE 27 Notices
ARTICLE 28 Partnership Tenant
ARTICLE 29 Utilities and Services
ARTICLE 30 Table of Contents, Etc.
ARTICLE 31 Miscellaneous Definitions, Severability and Interpretation
Provisions
ARTICLE 32 Adjacent Excavation
ARTICLE 33 Building Rules
ARTICLE 34 Broker
ARTICLE 35 Security
ARTICLE 36 Arbitration, Etc.
ARTICLE 37 Parties Bound
SCHEDULE A Building Rules
EXHIBIT 1 Plan of Demised Premises
-i-
LEASE dated as of the _______ day of May, 2000, between 00 XXXXX
XXXXXX L.P., a Delaware limited partnership having its principal office at 000
Xxxx Xxxxxx, Xxxxxxx of Manhattan, City, County, and State of New York, as
landlord (referred to as "Owner"), and BOTTOMLINE TECHNOLOGIES, INC., a Delaware
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corporation authorized to transact business in the State of New York, having an
office at 000 Xxxxx Xxxxxx, Xxxxxxxxxx, XX 00000, as tenant (referred to as
"Tenant").
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W I T N E S S E T H:
Owner and Tenant hereby covenant and agree as follows:
ARTICLE 1
DEMISED PREMISES, TERM, RENTS
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Section 1.01. Demised Premises: Owner hereby leases to Tenant and
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Tenant hereby hires from Owner that portion of the eighteenth (18/th/) floor
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indicated by outlining and diagonal markings on the floor plan initialled by the
parties and annexed hereto as Exhibit "1" in the building known as 00 Xxxxx
Xxxxxx, in the Borough of Manhattan, City of New York (said building is referred
to as the "Building", and the Building together with the plot of land upon which
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it stands is referred to as the "Real Property"), at the annual rental rate or
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rates set forth in Section 1.03, and upon and subject to all of the terms,
covenants and conditions contained in this Lease. The premises leased to
Tenant, together with all appurtenances, fixtures, improvements, additions and
other property attached thereto or installed therein at the commencement of, or
at any time during, the term of this Lease, other than Tenant's Personal
Property (as defined in Article 4), are referred to, collectively, as the
"Demised Premises".
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Section 1.02. Demised Term: A. The Demised Premises are leased for
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a term (referred to as the "Demised Term") to commence on June 1, 2000 and to
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end on July 31, 2003, unless the Demised Term shall sooner terminate pursuant to
any of the terms, covenants or conditions of this Lease or pursuant to law.
B. The date upon which the Demised Term shall
commence pursuant to Subsection A of this Section is referred to as the
"Commencement Date" and the date fixed pursuant to said Subsection A as the date
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upon which the Demised Term shall end is referred to as the "Expiration Date".
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C. Tenant waives any right to rescind this Lease
under Section 223-a of the New York Real Property Law or any successor statute
of similar import then in force and further waives the right to recover any
damages which may result from Owner's failure to deliver possession of the
Demised Premises on the date set forth in Subsection A of this Section, whether
or not due to the holding over of the Present Occupant (defined in Article 12),
for the commencement of the Demised Term.
Section 1.03. Fixed Rent: A. This Lease is made at the annual
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rental rate (referred to as "Fixed Rent") of ONE HUNDRED NINETEEN THOUSAND SIX
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HUNDRED SIXTY-FOUR and 00/100 ($119,664.00) DOLLARS.
B. The Fixed Rent, any increases in the Fixed Rent
and any additional rent payable pursuant to the provisions of this Lease shall
be payable by Tenant to Owner at its office (or at such other place as Owner may
designate in a notice to Tenant) in lawful money of the United States which
shall be legal tender in payment of all debts and dues, public and private, at
the time of payment or by Tenant's good check drawn on a bank or trust company
whose principal office is located in New York City and which is a member of the
New York Clearinghouse Association, without prior demand therefor and without
any offset or deduction whatsoever except as otherwise specifically provided in
this Lease. The Fixed Rent shall be payable in equal monthly installments of
NINE THOUSAND NINE HUNDRED SEVENTY-TWO and 00/100 ($9,972.00) DOLLARS, in
advance, on the first (1st) day of each month during the Demised Term (except as
otherwise provided in Subsection C of this Section).
C. The sum of NINETEEN THOUSAND NINE HUNDRED FORTY-
FOUR and 00/100 ($19,944.00) DOLLARS, representing the installment of Fixed Rent
for the first (1st) and second (2/nd/) full calendar months of the Demised Term,
is due and payable on or before July 1, 2000. In the event that the Commencement
Date shall occur on a date other than the first (1st) day of any calendar month,
Tenant shall pay to Owner, on the first (1st) day of the month next succeeding
the month during which the Commencement Date shall occur, a sum equal to THREE
HUNDRED THIRTY-TWO and 40/100 ($332.40) DOLLARS, multiplied by the number of
calendar days in the period from the Commencement Date to the last day of the
month in which the Commencement Date shall occur, both inclusive. Such payment,
together with the sum paid by Tenant upon the execution of this Lease, shall
constitute payment of the Fixed Rent for the period from the Commencement Date
to and including the last day of the next succeeding calendar month.
Section 1.04. Tenant's General Covenant: Tenant covenants (i) to pay
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the Fixed Rent, any increases in the Fixed Rent, and any additional rent payable
pursuant to the provisions of this Lease, and (ii) to observe and perform, and
to permit no violation of, the terms, covenants and conditions of this Lease on
Tenant's part to be observed and performed.
Section 1.05. Rent Holiday: Provided Tenant is not then in default
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in the observance and performance of any of the terms, covenants and conditions
of this Lease on Tenant's part to be observed and performed, Tenant shall be
entitled to a conditional rent holiday and shall not be required to pay any
portion of the Fixed Rent with respect to the period from the Commencement Date
to and including the date thirty (30)__) days next following the Commencement
Date but during such period of thirty (30) days Tenant shall otherwise be
required to comply with all of the other terms, covenants and conditions of this
Lease on Tenant's part to be observed and performed, including, but not limited
to, the provisions of Article 23 and Article 29. If at any time during the
Demised Term Tenant shall be in default in the observance and performance of any
of the terms, covenants and conditions of this Lease on Tenant's part to be
observed and performed, then the total sum of the Fixed Rent and increases
therein so conditionally excused by operation of the foregoing provisions of
this Section shall become immediately due and payable by Tenant to Owner. If, as
of the Expiration Date, Tenant shall not then be in default in the observance
and performance of any of the terms, covenants and conditions of this Lease on
Tenant's part to be observed and performed, Owner shall waive payment of all
such Fixed Rent and increases therein so conditionally excused.
Section 1.06. Tenant's Existing License:
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A. A portion of the twenty-eighth (28th) floor of the
Building is presently affected by a license dated May 24, 1998 between Owner, as
licensor, and Tenant, as licensee, for a term which expired on February 29,
2000, and Tenant, as licensee, continues to occupy the premises affected thereby
(said license, as may have been modified by any written agreements, including an
agreement dated March 24, 1998 is referred to as "Tenant's Existing License").
Tenant's Existing License and the term demised therein shall terminate and come
to an end on the date (referred to as the "Surrender Date") one (1) day prior to
the Commencement Date of this Lease, unless sooner terminated pursuant to any of
the terms, covenants or conditions of Tenant's Existing License or pursuant to
law. Tenant agrees to vacate and surrender to Owner the entire premises demised
in Tenant's Existing License free of all tenancies and occupancies on or prior
to the Surrender Date, as if the Surrender Date were the date originally fixed
for the expiration of the term demised in Tenant's Existing License, and Tenant
shall fully comply with the provisions of Tenant's Existing License on or prior
to the Surrender Date. If requested by Owner, Tenant agrees to execute and
deliver to Owner after the Surrender Date, a further agreement, in form
reasonably satisfactory to Owner, evidencing the surrender to Owner of the
premises demised in Tenant's Existing License; however, neither Owner's failure
to request such execution nor Tenant's failure to execute and deliver such
instrument shall vitiate the provisions of this Section 1.06.
B. Provided Tenant, as licensee, is not then in
default under any of its obligations under Tenant's Existing License or this
Section, Tenant shall be released from its obligations under Tenant's Existing
License accruing after the Surrender Date, except as otherwise provided in this
Section. If Tenant shall vacate
the premises demised in Tenant's Existing License or any part thereof at any
time prior to the Surrender Date, such premises or such part thereof shall be
deemed surrendered to Owner at such time. Nothing contained in this Section,
shall be deemed to affect Tenant's obligation to pay the license fee reserved in
Tenant's Existing License, and any increases therein, accruing with respect to
all periods to and including the Surrender Date, and regardless of when Tenant
shall vacate the premises demised in Tenant's Existing License, Tenant shall not
be entitled to any refund, abatement or apportionment of the License Fee or
annual rental rate reserved in Tenant's Existing License or any such increases
for such periods.
C. All unpaid portions of the License Fee and
any increases therein and any additional fees due under Tenant's Existing
License with respect to all periods to and including the later of (i) the
Surrender Date or (ii) the date upon which Tenant shall vacate and surrender the
premises demised in Tenant's Existing License in accordance with the provisions
of this Section and Tenant's Existing License shall, at Owner's election, be
payable by Tenant to Owner as additional rent under this Lease.
D. Tenant represents and warrants to Owner that
Tenant is not in default under any of the terms, covenants or conditions of
Tenant's Existing License and that Tenant has not at any time heretofore
committed or suffered, and will not at any time hereafter commit or suffer, any
act, deed, matter or thing whatsoever whereby the premises demised in Tenant's
Existing License or any part thereof are or shall be at any time hereafter in
any way impeached, charged, affected or encumbered. Tenant's obligations under
the applicable provisions of Tenant's Existing License shall survive the
expiration of the term thereof.
E. Except to the extent expressly modified by
the foregoing provisions of this Section, Tenant's Existing License is hereby
ratified and confirmed in respects.
ARTICLE 2
USE AND OCCUPANCY
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Section 2.01. General Covenant of Use: Tenant shall use and occupy
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the Demised Premises for the following purpose: general offices for technology,
research and development.
Section 2.02. No Adverse Use: Tenant shall not use or occupy, or
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permit the use or occupancy of, the Demised Premises or any part thereof, for
any purpose other than the purpose specifically set forth in Section 2.01, or in
any manner which, in Owner's reasonable judgment, (a) shall adversely affect or
interfere with (i) any services required to be furnished by Owner to Tenant or
to any other tenant or occupant of the Building, or (ii) the proper and
economical rendition of any such service, or (iii) the use or enjoyment of any
part of the Building by any other tenant or occupant, or (b) shall tend to
impair the character or dignity of the Building.
ARTICLE 3
ALTERATIONS
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Section 3.01. General Alteration Covenants: Tenant shall not make or
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perform, or permit the making or performance of, any alterations, installations,
improvements, additions or other physical changes in or about the Demised
Premises (referred to collectively, as "Alterations" and individually as an
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"Alteration") without Owner's prior consent in each instance. Owner agrees not
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unreasonably to withhold its consent to any non-structural Alterations proposed
to be made by Tenant to adapt the Demised Premises for Tenant's business
purposes. Owner agrees that Tenant may, without Owner's prior written consent,
make any merely decorative changes and other non-structural Alterations in the
Demised Premises, the estimated cost of which constituting a single project
shall not exceed FIFTY THOUSAND and 00/100 ($50,000.00) DOLLARS and which shall
not affect the electrical, plumbing and heating, ventilation and air
conditioning systems in the Builiding or any portion of the Building outside the
Demised Premises. Notwithstanding the foregoing provisions of this Section or
Owner's consent to any Alterations, all Alterations and decorations shall be
made and performed in conformity with and subject to the following provisions:
A. All Alterations and decorations, shall be made and
performed at Tenant's sole cost and expense and at such time and in such manner
as Owner may, from time to time, designate;
B. No Alteration shall adversely affect the
structural integrity of the Building;
C. Alterations and decorations shall be made only by
contractors or mechanics approved by Owner, such approval not unreasonably to be
withheld (notwithstanding the foregoing, all Alterations requiring mechanics in
heating, ventilation, air conditioning, electrical, plumbing, sprinkler and
other mechanical trades with respect to which Owner has adopted or may hereafter
adopt a list or lists of approved contractors shall be made only by contractors
selected by Tenant from such list or lists provided there are at least three (3)
contractors on each such list and the prices charged by such contractors are
competitive for similar work in the Borough of Manhattan in comparable first
class office buildings);
D. No Alteration or decoration shall affect any part
of the Building other than the Demised Premises or adversely affect any service
required to be furnished by Owner to Tenant or to any other tenant or occupant
of the Building (including, without limitation, the Building-wide standard
systems required to provide elevator, heat, ventilation, air-conditioning and
electrical and plumbing services in the Building);
E. No Alteration shall reduce the value or utility of
the Building or any portion thereof;
F. No Alteration shall affect the Certificate of
Occupancy for the Building or the Demised Premises;
G. No Alteration or decoration shall affect the
outside appearance of the Building or the color or style of any venetian blinds
(except that Tenant may remove any venetian blinds provided that they are
promptly replaced by Tenant with blinds of a similar type, material and color);
H. All business machines and mechanical equipment
shall be placed and maintained by Tenant in settings sufficient, in Owner's
judgment, to absorb and prevent vibration, noise and annoyance to other tenants
or occupants of the Building;
I. Tenant shall submit to Owner detailed plans and
specifications stamped by Tenant's architect (including layout, architectural,
mechanical and structural drawings) for each proposed Alteration and shall not
commence any such Alteration without first obtaining Owner's approval of such
plans and specifications, such approval not unreasonably to be withheld or
delayed, notwithstanding the foregoing, Tenant shall not be required to submit
any detailed plans and specifications for any Alterations unless such plans and
specifications are, in the ordinary course, prepared for such Alterations or are
required to be prepared in connection with any filings or other applicable
requirements of any law, order, rule or regulation of any Federal, State, County
or Municipality, including but not limited to, the Department of Buildings of
the City of New York, and in those cases where Tenant shall not be
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required to submit such detailed plans and specifications, Tenant shall submit
to Owner, in lieu thereof, information with respect to such Alterations in
reasonably sufficient detail so as to enable Owner to determine the nature and
extent of the work to be performed, and following the completion of each
Alteration, Tenant shall submit to Owner a computerized "as built" drawing file
for the Demised Premises (or if the Demised Premises comprise more than one (1)
floor, for each floor of the Demised Premises being altered) and in those cases
where Tenant shall not be so required to submit such detailed plans and
specifications, Tenant shall submit to Owner, in lieu thereof, information with
respect to such Alterations in reasonably sufficient detail so as to enable
Owner to determine the nature and extent of the work to be performed; such file
will be in DXF format and contain, on a separate layer, all ceiling-height
partitions and doors within the Demised Premises (or if the Demised Premises
comprise more than one (1) floor, within each floor of the Demised Premises
being altered);
J. Prior to the commencement of each proposed
Alteration, Tenant shall have procured and paid for and exhibited to Owner, so
far as the same may be required from time to time, all permits, approvals and
authorizations of all Governmental Authorities (as defined in Section 6.01.)
having or claiming jurisdiction;
K. Prior to the commencement of each proposed
Alteration and decoration, Tenant shall furnish to Owner duplicate original
policies of workmen's compensation insurance covering all persons to be employed
in connection with such Alteration or decoration, including those to be employed
by all contractors and subcontractors, and of comprehensive public liability
insurance (including property damage coverage) in which Owner, its agents, the
holder of any Mortgage (as defined in Section 7.01.) and any lessor under any
Superior Lease (as defined in Section 7.01.) shall be named as parties insured,
which policies shall be issued by companies, and shall be in form and amounts,
satisfactory to Owner and shall be maintained by Tenant until the completion of
such Alteration;
L. In the event Owner or its agents employ any
independent architect or engineer to examine any plans or specifications
submitted by Tenant to Owner in connection with any proposed Alteration, Tenant
agrees to pay to Owner a sum equal to any reasonable out-of-pocket fees incurred
by Owner in connection therewith.
M. All fireproof wood test reports, electrical and
air conditioning certificates, and all other permits, approvals and certificates
required by all Governmental Authorities shall be timely obtained by Tenant and
submitted to Owner;
N. All Alterations and decorations, once commenced,
shall be made promptly and in a good and workmanlike manner;
O. Notwithstanding Owner's approval of plans and
specifications for any Alteration, all Alterations and decorations shall be made
and performed in full compliance with all Legal Requirements (as defined in
Section 6.01.) and with all applicable rules, orders, regulations and
requirements of the New York Board of Fire Underwriters and the New York Fire
Insurance Rating Organization or any similar body;
P. All Alterations and decorations shall be made and
performed in accordance with the Building Rules and Building Rules for
Alterations;
Q. All materials and equipment to be installed,
incorporated or located in the Demised Premises as a result of all Alterations
shall be new and first quality;
R. No materials or equipment shall be subject to any
lien, encumbrance, chattel mortgage or title retention or security agreement of
any kind;
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S. Tenant, before commencement of each Alteration,
the estimated cost of which constituting a single project shall exceed ONE
HUNDRED THOUSAND and 00/100 ($100,000.00) DOLLARS shall furnish to Owner a
performance bond or other security satisfactory to Owner, in an amount at least
equal to the estimated cost of such Alteration, guaranteeing the performance and
payment thereof;
T. No Alteration shall be commenced unless any
preceding Alteration shall have been fully paid for and proof of such payment
furnished to Owner;
U. Following the completion of each Alteration,
Tenant, at Tenant's expense, shall obtain certificates of final approval of such
Alteration required by any Governmental Authority and shall furnish Owner with
copies thereof.
V. Tenant agrees that Tenant will not install, affix,
add or paint in or on, nor permit, any work of visual art (as defined in the
Federal Visual Artists' Rights Act of 1990 or any successor law of similar
import) or other Alteration to be installed in or on, or affixed, added to, or
painted on, the interior or exterior of the Demised Premises, or any part
thereof, including, but not limited to, the walls, floors, ceilings, doors,
windows, fixtures and on land included as part of the Demised Premises, which
work of visual art or other Alteration would, under the provisions of the
Federal Visual Artists' Rights Act of 1990, or any successor law of similar
import, require the consent of the author or artist of such work or Alteration
before the same could be removed, modified, destroyed or demolished.
W. Under no circumstances shall Tenant be permitted
to locate any telecommunications facilities in the telecommunications closets of
the Building. With respect to Tenant's telecommunications facilities, (i)
Tenant, without separate additional cost by Tenant payable to Owner, shall
contract separately with all providers of Tenant's telecommunications facilities
(each of which is referred to as a "Provider") and pay each Provider for all
services provided by it to Tenant, and (ii) each Provider shall use,
exclusively, the telecommunications cable distribution system in the Building
designated by Owner and shall contract separately with the company providing
cable distribution service in the Building (referred to as the
"Telecommunications Cable Distribution Company") for the supply and maintenance
of distribution cables. The Provider and Tenant shall comply with all reasonable
rules and regulations adopted by Owner and the Telecommunications Cable
Distribution Company. Owner shall not be liable to Tenant or anyone claiming
through or under Tenant for any damages, including, but not limited to, special,
incidental, remote or consequential damages, including, without limitation, lost
revenue, lost profits and additional operating or personnel expenses arising
from any acts, omissions or negligence of the Provider and the
Telecommunications Cable Distribution Company.
Section 3.02. No Consent to Contractor/No Mechanics Lien: Nothing in
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this Lease shall be deemed or construed in any way as constituting the consent
or request of Owner, express or implied, by inference or otherwise, to any
contractor, subcontractor, laborer or materialmen, for the performance of any
labor or the furnishing of any material for any specific Alteration to, or
repair of, the Demised Premises, the Building, or any part of either. Any
mechanic's or other lien filed against the Demised Premises or the Building or
the Real Property for work claimed to have been done for, or materials claimed
to have been furnished to, Tenant or any person claiming through or under Tenant
or based upon any act or omission or alleged act or omission of Tenant or any
such person shall be discharged by Tenant, at Tenant's sole cost and expense,
within ten (10) days after the filing of such lien.
Section 3.03. Labor Harmony: Tenant shall not, at any time prior to
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or during the Demised Term, directly or indirectly employ, or permit the
employment of, any contractor, mechanic or laborer in the Demised Premises,
whether in connection with any Alteration or otherwise, if such employment will
interfere or cause any conflict with other contractors, mechanics, or laborers
engaged in the construction, maintenance or operation of the Building by Owner,
Tenant or others. In the event of any such interference or conflict, Tenant,
upon demand of Owner, shall cause all contractors, mechanics or laborers causing
such interference or conflict to leave the Building immediately.
Section 3.04. Compliance with Fire Safety: Without in any way
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limiting the generality of the provisions of Section 3.01, all Alterations shall
be made and performed in full compliance with all standards and
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practices adopted by Owner for fire safety in the Building. No Alteration shall
affect all or any part of any Class E Fire Alarm and Communication system
installed in the Demised Premises, except that in connection with any such
Alteration Tenant may relocate certain components of such system, provided (i)
such relocation shall be performed in a manner first reasonably approved by
Owner, (ii) the new location of any such component shall be first reasonably
approved by Owner, (iii) prior to any such relocation Tenant shall submit to
Owner detailed plans and specifications therefor which shall be first reasonably
approved by Owner and (iv) Owner shall have the election of relocating such
components either by itself or by its contractors, in which event all reasonable
expenses incurred by Owner shall be reimbursed by Tenant upon demand of Owner,
as additional rent.
Section 3.05. Sprinklers: The Demised Premises shall contain a
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sprinkler system and notwithstanding anything to the contrary set forth in
Sections 5.01 and 6.01, Owner, at Owner's expense, shall perform routine
maintenance of, and shall repair and replace if necessary, said sprinkler system
and any replacements thereof, unless such repair or replacement is due to
Tenant's acts, omissions or negligence, in which event Owner shall repair or
replace same, at Tenant's sole cost and expense. Owner shall also perform
controlled inspections of said sprinkler system as and when required by law and
Tenant shall give Owner reasonable access to perform such repairs, maintenance
and inspections. Any sprinkler system and any replacements thereof whether made
at Tenant's expense or Owner's expense, shall be deemed the property of Owner.
Section 3.06. Hazardous Material: If any Legal Requirement of any
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Governmental Authority requires that any hazardous material contained in or
about the Demised Premises and installed therein by Tenant or any person
claiming through or under Tenant be removed or dealt with in any particular
manner in connection with any Alterations of the Demised Premises or otherwise,
then it shall be Tenant's obligation, at Tenant's expense, to remove or so deal
with such hazardous material in accordance with all such laws, orders, rules and
regulations. In the event Tenant is required to remove or so deal with such
hazardous material in accordance with the provisions of the foregoing sentence
then, notwithstanding anything to the contrary contained herein, Owner, at
Owner's election, shall have the option to itself remove or so deal with such
hazardous material and, in such event, Tenant shall pay to Owner all of Owner's
costs in connection therewith within ten (10) days next following the rendition
of a statement thereof by Owner to Tenant.
Section 3.07. Dispute Resolution: Any dispute with respect to the
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reasonability of any failure or refusal of Owner to grant its consent or
approval to any request for such consent or approval pursuant to the provisions
of Section 3.01 with respect to which request Owner has agreed, in such Section
not unreasonably to withhold such consent or approval, shall be determined by
arbitration in accordance with the provisions of Article 36.
Section 3.08. Fire Alarm and Communication System Connection Fees:
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In the event that Tenant, pursuant to the provisions of this Lease, including,
but not limited to, the provisions of this Article 3 and Article 6, connects any
of the following equipment to any Class E Fire Alarm and Communication system
installed in the Demised Premises, Tenant shall pay to Owner as a one (1) time
connection fee the following sums set forth opposite the equipment listed below
(which sums shall be subject to increases due to increases in the cost to Owner
of operating and maintaining such Class E Fire Alarm and Communication system
over such costs on the date of this Lease):
A. Speakers in excess of 4 per
floor of the Demised Premises (or
if the Demised Premises contain
less than one (1) floor, in excess
of four in the Demised Premises) $500.00 per device
B. Strobe Lights (single unit) $100.00 per device
C. Combination Speaker/Strobe
light $250.00 per device
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D. Duct Detectors (supplementary
air conditioning systems) $500.00 per point
E. Smoke Detectors (multi-purpose) $500.00 per point
F. Preaction Sprinkler System:
waterflow $500.00 per point
tamper $500.00 per point
X. Xxxxxx Phone (additional) $1,000.00 per unit
H. Fail Safe Door Release $250.00 per connection
Section 3.09. A. In the event that, at any time during the Demised
Term, in connection with any Alterations proposed to be performed by Tenant in
the Demised Premises Tenant is unable to obtain a New York City Department of
Environmental Protection Form ACP5 dated 10/88 (or any successor form), signed
by a certified asbestos investigator, or any other form or approval required by
Federal, State, County or Municipal authorities, indicating that said
Alterations do not constitute an asbestos project, Owner agrees, upon notice
from Tenant to such effect, to perform such work as shall be required to enable
Tenant to obtain any such form or approval.
B. If any laws, orders, rules or regulations of any Federal, State,
County or Municipal authority require that any asbestos or other hazardous
material contained in or about the Demised Premises be removed or dealt with in
any particular manner, then it shall be Owner's obligation, at Owner's expense,
to remove or so deal with such asbestos or other hazardous material in
accordance with such laws, orders, rules and regulations.
C. Notwithstanding the provisions of subsections A and B of this
Section, in the event any work performed by Owner pursuant to the provisions of
either or both of such subsections is in any way disturbed or damaged by Tenant
or any person claiming through or under Tenant, or asbestos or other hazardous
material is installed in the Demised Premises by or on behalf of Tenant, or any
person claiming through or under Tenant, Owner shall have no responsibility in
connection with the disturbed or damaged work or the asbestos or other hazardous
material so installed by Tenant or any person claiming through or under Tenant
and no obligation to perform any work with respect to the disturbed or damaged
work or the asbestos or other hazardous material so installed by Tenant or any
person claiming through or under Tenant, but it shall be Tenant's obligation, at
Tenant's expense, to (i) perform such work with respect to such disturbed or
damaged work or the asbestos or other hazardous material so installed by Tenant
or any person claiming through or under Tenant as shall be required to enable
Tenant to obtain any form or approval referred to in subsection A, and (ii)
remove or so deal with such asbestos or other hazardous material in accordance
with all such laws, orders, rules and regulations referred to in subsection B.
ARTICLE 4
OWNERSHIP OF IMPROVEMENTS
-------------------------
8
Section 4.01. General Rights of Owner and Tenant: All
----------------------------------
appurtenances, fixtures, improvements, additions and other property attached to
or installed in the Demised Premises, whether by Owner or Tenant or others, and
whether at Owner's expense, or Tenant's expense, or the joint expense of Owner
and Tenant, shall be and remain the property of Owner, except that any such
fixtures, improvements, additions and other property installed at the sole
expense of Tenant with respect to which Tenant has not been granted any credit
or allowance by Owner, and which are removable without material damage to the
Demised Premises shall be and remain the property of Tenant and are referred to
as "Tenant's Personal Property". Any replacements of any property of Owner,
--------------------------
whether made at Tenant's expense or otherwise, shall be and remain the property
of Owner.
ARTICLE 5
REPAIRS
-------
Section 5.01. Tenant's Repair Obligations: Tenant shall take good
---------------------------
care of the Demised Premises (including, but not limited to, any Class E Fire
Alarm and Communication system and any sprinkler system installed therein and
any installations made or equipment installed therein as a result of any
requirement of New York City Local Law #16 of 1984 or any successor law or like
import) and, at Tenant's sole cost and expense, shall make all repairs and
replacements, structural and otherwise, ordinary and extraordinary, foreseen and
unforeseen as and when needed to preserve the Demised Premises (including, but
not limited to, any Class E Fire Alarm and Communication system and any
installations made or equipment installed therein as a result of any requirement
of New York City Local Law #16 of 1984 or any successor law of like import) in
good and safe working order and in first class repair and condition, except that
Tenant shall not be required to make any repairs or replacements to the Demised
Premises unless necessitated or occasioned by the acts, omissions or negligence
of Tenant or any person claiming through or under Tenant or any of their
servants, employees, contractors, agents, visitors or licensees, or by the
manner of use or occupancy of the Demised Premises by Tenant or any such person
(in contradistinction to the mere use or occupancy of the Demised Premises for
the purposes set forth in Section 2.01). Without affecting Tenant's obligations
set forth in the preceding sentence, Tenant, at Tenant's sole cost and expense,
shall also (i) make all repairs and replacements, and perform all maintenance as
and when necessary, to the lamps, tubes, ballasts, and starters in the lighting
fixtures installed in the Demised Premises, (ii) make all repairs and
replacements, as and when necessary, to Tenant's Personal Property and to any
Alterations made or performed by or on behalf of Tenant or any person claiming
through or under Tenant, and (iii) if the Demised Premises shall include any
space on any ground, street, mezzanine or basement floor in the Building, make
all replacements, as and when necessary, to all windows and plate and other
glass in, on or about such space, and obtain and maintain, throughout the
Demised Term, plate glass insurance policies issued by companies, and in form
and amounts, satisfactory to Owner, in which Owner, its agents and any lessor
under any ground or underlying lease shall be named as parties insured, and (iv)
perform all maintenance and make all repairs and replacements, as and when
necessary, to any air conditioning equipment, private elevators, escalators,
conveyors or mechanical systems (other than the Building's standard equipment
and systems) which may be installed in the Demised Premises by Owner, Tenant or
others. However, the provisions of the foregoing sentence shall not be deemed
to give to Tenant any right to install air conditioning equipment, elevators,
escalators, conveyors or mechanical systems. All repairs and replacements made
by or on behalf of Tenant or any person claiming through or under Tenant shall
be made and performed in conformity with, and subject to the provisions of
Article 3 and shall be at least equal in quality and class to the original work
or installation. The necessity for, and adequacy of, repairs and replacements
pursuant to this Article 5 shall be measured by the standard which is
appropriate for first class office buildings of similar construction and class
in the Borough of Manhattan, City of New York.
Section 5.02. Supplementing the provisions of Section 5.01, Owner, at
Owner's sole cost and expense, shall timely make (i) all structural repairs to
the Demised Premises and the Building as and when required, (ii) all repairs
necessary to furnish the plumbing, electrical, air conditioning, ventilating,
heating and elevator services required to be furnished by Owner to Tenant under
the provisions of Article 29, and (iii) all necessary repairs to the public
portions of the Building which affect Tenant's use and enjoyment of the Demised
Premises, except that Owner
9
shall not be required to make any of the repairs referred to in subdivision (i),
(ii) or (iii) of this sentence if Tenant is obligated to make such repairs
pursuant to the provisions of Section 5.01. Notwithstanding the foregoing
provisions of this Section, Owner shall have no obligation to make any repairs
unless and until specific actual notice of the necessity therefor shall have
been given to Owner.
ARTICLE 6
COMPLIANCE WITH LAWS
--------------------
Section 6.01. General Covenants: Tenant, at Tenant's sole cost and
-----------------
expense, shall comply with all Legal Requirements (hereinafter defined) which
shall impose any duty upon Owner or Tenant arising as a result of Tenant's use
of the Demised Premises or the use or occupation thereof, including, but not
limited to, any requirement that asbestos or other hazardous material installed
in the Demised Premises by Tenant or any person claiming through or under Tenant
be removed or dealt with in any particular manner, except that Tenant shall not
be required to make any Alterations in order so to comply unless such
Alterations shall be necessitated or occasioned, in whole or in part, by the
acts, omissions, or negligence of Tenant or any person claiming through or under
Tenant, or any of their servants, employees, contractors, agents, visitors or
licensees, or by the manner of use or occupancy of the Demised Premises by
Tenant or by any such person (in contradistinction to the mere use or occupancy
of the Demised Premises for the purposes set forth in Section 2.01). For all
purposes of this Lease the term "Legal Requirements" shall mean all present and
------------------
future laws, codes, ordinances, statutes, requirements, orders and regulations,
ordinary and extraordinary, foreseen and unforeseen (including, but not limited
to, the New York State Energy Conservation Construction Code, New York City
Local Laws #5 of 1973, #16 of 1984 and #58 of 1987 and the Americans with
Disabilities Act, and any successor laws of like import) of any Governmental
Authority (hereinafter defined) and all directions, requirements, orders and
notices of violations thereof. For all purposes of this Lease, the term
"Governmental Authority" shall mean the United States of America, the State of
----------------------
New York, the County of New York, the Borough of Manhattan, the City of New
York, any political subdivision thereof and any agency, department, commission,
board, bureau or instrumentality of any of the foregoing, now existing or
hereafter created, having jurisdiction over Owner, Tenant, this Lease or the
Real Property or any portion thereof. Any work or installations made or
performed by or on behalf of Tenant or any person claiming through or under
Tenant pursuant to the provisions of this Article shall be made in conformity
with, and subject to the provisions of Article 3. Compliance with any
requirement regarding asbestos or other hazardous material shall be made in
conformity with the provisions of Section 3.06.
Section 6.02. Tenant's Compliance with Owner's Fire Insurance:
-----------------------------------------------
Tenant shall not do anything, or permit anything to be done, in or about the
Demised Premises which shall (i) invalidate or be in conflict with the
provisions of any fire and/or other insurance policies covering the Building or
any property located therein, or (ii) result in a refusal by fire insurance
companies of good standing to insure the Building or any such property in
amounts reasonably satisfactory to Owner, or (iii) subject Owner to any
liability or responsibility for injury to any person or property by reason of
any business operation being conducted in the Demised Premises, or (iv) cause
any increase in the fire insurance rates applicable to the Building or property
located therein at the beginning of the Demised Term or at any time thereafter.
Tenant, at Tenant's expense, shall comply with all present and future rules,
orders, regulations and/or requirements of the New York Board of Fire
Underwriters and the New York Fire Insurance Rating Organization or any similar
body and the issuer of any insurance obtained by Owner covering the Building
and/or the Real Property, whether ordinary or extraordinary, foreseen or
unforeseen, including, but not limited to, any requirement that hazardous
material installed in the Demised Premises by Tenant or any person claiming
through or under Tenant be removed or dealt with in any particular manner and
any requirement of New York City Local Law #5 of 1973, #16 of 1984, #58 of 1987
and the Americans With Disabilities Act or any successor laws of like import.
Section 6.03. Fire Insurance Rates: In any action or proceeding
--------------------
wherein Owner and Tenant are parties, a schedule or "make up" of rates
applicable to the Building or property located therein issued by the New York
Fire Insurance Rating Organization, or other similar body fixing such fire
insurance rates, shall be conclusive evidence
10
and of the several items and charges in the fire insurance rates then applicable
to the Building or property located therein.
ARTICLE 7
SUBORDINATION, ATTORNMENT, ETC.
-------------------------------
Section 7.01. Lease Subordination: This Lease and all rights of
-------------------
Tenant under this Lease are, and shall remain, unconditionally subject and
subordinate in all respects to all ground and underlying leases now or hereafter
in effect affecting the Real Property or any portion thereof, and to all
mortgages which may now or hereafter affect such leases or the Real Property,
and to all advances made or hereafter to be made under such mortgages, and to
all renewals, modifications, consolidations, correlations, replacements and
extensions of, and substitutions for, such leases and mortgages (such leases as
above described are referred to herein collectively as the "Superior Lease" and
--------------
such mortgages as above described are referred to herein collectively as the
"Mortgage"). The foregoing provisions of this Section shall be self-operative
--------
and no further instrument of subordination shall be required. In confirmation
of such subordination, Tenant shall execute and deliver promptly any certificate
or other instrument which Owner, or any lessor under any Superior Lease, or any
holder of any Mortgage may request, and Tenant hereby, after five (5) days
notice and Tenant's failure to so execute and deliver any such certificate or
other instrument, irrevocably constitutes and appoints Owner and all such
lessors and holders, acting jointly or severally, as Tenant's agent and
attorney-in-fact to execute any such certificate or other instrument for or on
behalf of Tenant. If, in connection with obtaining financing with respect to
the Building, the Real Property, or the interest of the lessee under any
Superior Lease, any recognized lending institution shall request reasonable
modifications of this Lease as a condition of such financing, Tenant covenants
not unreasonably to withhold or delay its agreement to such modifications,
provided that such modifications do not materially increase the obligations, or
materially and adversely affect the rights, of Tenant under this Lease. No act
or failure to act on the part of Owner which would entitle Tenant under the
terms of this Lease, or by law, to be relieved of Tenant's obligations hereunder
or to terminate this Lease shall result in a release or termination of such
obligations or a termination of this Lease unless (i) Tenant shall have first
given written notice of Owner's act or failure to act to the holder or holders
of any Mortgage and/or the lessor under any Superior Lease of whom Tenant has
been given written notice, specifying the act or failure to act on the part of
Owner which could or would give basis to Tenant's rights; and (ii) the holder or
holders of such Mortgage and/or the lessors under any Superior Lease, after
receipt of such notice, have failed or refused to correct or cure the condition
complained of within a reasonable time thereafter, but nothing contained in this
sentence shall be deemed to impose any obligation on any such holder or lessor
to correct or cure any such condition. "Reasonable time" as used above means
---------------
and includes a reasonable time to obtain possession of the Building if any such
holder or lessor elects to do so (provided such holder or lessor institutes
proceedings to obtain possession within a reasonable time after notice from
Tenant pursuant to the foregoing provisions and conducts such proceedings with
reasonable diligence) and a reasonable time after so obtaining possession to
correct or cure the condition if such condition is determined to exist (provided
such holder or lessor commences said cure within ten (10) days after obtaining
possession and prosecutes the work required to cure with reasonable diligence).
Section 7.02. Tenant Attornment: If, at any time prior to the
-----------------
expiration of the Demised Term, any Superior Lease under which Owner then shall
be the lessee shall terminate or be terminated for any reason, or the holder of
any Mortgage comes into possession of the Real Property or the Building or the
estate created by any Superior Lease by a receiver or otherwise, Tenant agrees,
at the election and upon demand of any owner of the Real Property, or of the
holder of any Mortgage so in possession, or of any lessee under any Superior
Lease covering the premises which include the Demised Premises, to attorn, from
time to time, to any such owner, holder, or lessee, upon the then executory
terms and conditions of this Lease, for the remainder of the term originally
demised in this Lease, provided that such owner, holder or lessee, as the case
may be, shall then be entitled to possession of the Demised Premises. The
provisions of this Section shall enure to the benefit of any such owner, holder,
or lessee, shall apply notwithstanding that, as a matter of law, this Lease may
terminate upon the termination of any Superior Lease, shall be self-operative
upon any such demand, and no further instrument shall be required to give effect
to said provisions. Tenant, however, upon demand of any such owner, holder, or
lessee, agrees to execute, from time to time, instruments in confirmation
11
of the foregoing provisions of this Section, satisfactory to any such owner,
holder, or lessee, acknowledging such attornment and setting forth the terms and
conditions of its tenancy. Nothing contained in this Section shall be construed
to impair any right otherwise exercisable by any such owner, holder, or lessee.
Notwithstanding anything to the contrary set forth in this Article no such
owner, holder or lessee shall be bound by (i) any payment of any instalment of
Fixed Rent or increases therein or any additional rent which may have been made
more than thirty (30) days before the due date of such instalment (except
prepayments in the nature of security for the performance of Tenant's
obligations under this Lease), or (ii) any amendment or modification to this
Lease which is made without its consent.
Section 7.03. Tenant Estoppel Certificate: From time to time, within
---------------------------
seven (7) days next following Owner's request, Tenant shall deliver to Owner a
written statement executed and acknowledged by Tenant, in form and substance
reasonably satisfactory to Owner, (i) stating that this Lease is then in full
force and effect and has not been modified, if this is the case, (or if
modified, setting forth the specific nature of all modifications), and (ii)
setting forth the date to which the Fixed Rent has been paid, and (iii) stating
whether or not, to the best knowledge of Tenant, Owner is in default under this
Lease, and, if Owner is in default, setting forth the specific nature of all
such defaults and (iv) stating that Tenant has accepted and occupied the Demised
Premises and all improvements required to be made by Owner pursuant to the
provisions of this Lease, have been made, if such be the case. Tenant
acknowledges that any statement delivered pursuant to this Section may be relied
upon by any purchaser or owner of the Building, or of the Real Property, or any
part thereof, or of Owner's interest in the Building or the Real Property or any
Superior Lease, or by the holder of any Mortgage, or by any assignee of the
holder of any Mortgage, or by any lessor under any Superior Lease.
Section 7.04. Owner Assignment of Lease and Rents: If Owner assigns
-----------------------------------
its interest in this Lease, or the rents payable hereunder, to the holder of any
Mortgage or the lessor under any Superior Lease, whether the assignment shall be
conditional in nature or otherwise, Tenant agrees that (a) the execution
thereof by Owner and the acceptance by such holder or lessor shall not be deemed
an assumption by such holder or lessor of any of the obligations of the Owner
under this Lease unless such holder or lessor shall, by written notice sent to
Tenant, specifically otherwise elect; and (b) except as aforesaid, such holder
or lessor shall be treated as having assumed Owner's obligations hereunder only
upon the foreclosure of such holder's Mortgage or the termination of such
lessor's Superior Lease and the taking of possession of the Demised Premises by
such holder or lessor, as the case may be.
ARTICLE 8
PROPERTY LOSS, ETC.
-------------------
Section 8.01. 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 Owner nor Owner's agents shall
be liable for any loss of or damage to any such property by theft or otherwise.
Except as otherwise expressly set forth in this Lease, neither (i) the
performance by Owner, Tenant or others of any decorations, repairs, alterations,
additions or improvements in or to the Building or the Demised Premises, nor
(ii) the failure of Owner or others to make any such decorations, repairs,
alterations, additions or improvements, nor (iii) any damage to the Demised
Premises or to the property of Tenant, nor any injury to any persons, caused by
other tenants or persons in the Building, or by operations in the construction
of any private, public or quasi-public work, or by any other cause, nor (iv) any
latent defect in the Building or in the Demised Premises, nor (v) any temporary
(i.e., six [6] months or less) or permanent closing, darkening or bricking up of
any windows of the Demised Premises for any reason whatsoever beyond Owner's
reasonable control, nor any permanent closing, darkening or bricking up of any
such windows if required by law or in connection with any construction upon
adjacent property, nor (vi) any inconvenience or annoyance to Tenant or injury
to or interruption of Tenant's business by reason of any of the events or
occurrences referred to in the foregoing subdivisions (i) through (v), shall
constitute an actual or constructive eviction, in whole or in part, or entitle
Tenant to any abatement or diminution of rent, or relieve Tenant from any of its
obligations under this Lease, or impose any liability upon Owner, or its agents,
or any lessor under any Superior Lease, other than such liability as may be
imposed upon Owner by law for Owner's negligence or the negligence of Owner's
agents, servants or employees
12
in the operation or maintenance of the Building or for the breach by Owner of
any express covenant of this Lease on Owner's part to be performed. Tenant's
taking possession of the Demised Premises shall be conclusive evidence, as
against Tenant, that, at the time such possession was so taken, the Demised
Premises and the Building were in good and satisfactory condition.
ARTICLE 9
DESTRUCTION-FIRE OR OTHER CASUALTY
----------------------------------
Section 9.01. Owner's Repair Obligations: If the Demised Premises or
--------------------------
Building shall be damaged by fire or other casualty, Tenant shall give prompt
notice to Owner of such damage, and Owner, at Owner's expense, shall thereafter
repair such damage. However, Owner shall have no obligation to repair any
damage to, or to replace, Tenant's Personal Property or any other property or
effects of Tenant. Except as otherwise provided in Section 9.03, if the entire
or a material portion of the Demised Premises shall be rendered untenantable or
if the Building is damaged to the extent that reasonable access to the Demised
Premises is not available by reason of any such damage, the Fixed Rent shall
xxxxx for the period from the date of such damage to the date when such damage
shall have been repaired, and if only a part of the Demised Premises shall be so
rendered untenantable, the Fixed Rent shall xxxxx for such period in the
proportion which the area of the part of the Demised Premises so rendered
untenantable bears to the total area of the Demised Premises. However, if,
prior to the date when all of such damage shall have been repaired, any part of
the Demised Premises so damaged shall be rendered tenantable and shall be used
or occupied by Tenant or any person or persons claiming through or under Tenant,
then the amount by which the Fixed Rent shall xxxxx shall be equitably
apportioned for the period from the date of any such use or occupancy to the
date when all such damage shall have been repaired. Tenant hereby expressly
waives the provisions of Section 227 of the New York Real Property Law, and of
any successor law of like import then in force, and Tenant agrees that the
provisions of this Article shall govern and control in lieu thereof.
Notwithstanding the foregoing provisions of this Section, if, prior to or during
the Demised Term, (i) the Demised Premises shall be totally damaged or rendered
wholly untenantable by fire or other casualty, and if Owner shall decide not to
restore the Demised Premises, or (ii) the Building shall be so damaged by fire
or other casualty that, in Owner's opinion, substantial alteration, demolition,
or reconstruction of the Building shall be required (whether or not the Demised
Premises shall have been damaged or rendered untenantable), then, in any of such
events, Owner, at Owner's option, may give to Tenant, within ninety (90) days
after such fire or other casualty, a five (5) days' notice of termination of
this Lease and, in the event such notice is given, this Lease and the Demised
Term shall come to an end and expire (whether or not said term shall have
commenced) upon the expiration of said five (5) days with the same effect as if
the date of expiration of said five (5) days were the Expiration Date, the Fixed
Rent shall be apportioned as of such date and any prepaid portion of Fixed Rent
for any period after such date shall be refunded by Owner to Tenant.
Section 9.02. Owner's Subrogation Waiver Provisions: Owner now has
-------------------------------------
and shall continue to maintain so long as same is available using commercially
sound business practices, throughout the Demised Term, in Owner's fire insurance
and "all-risk" policies covering the Building, provisions to the effect that
such policies shall not be invalidated should the insured waive, in writing,
prior to a loss, any or all right of recovery against any party for loss
occurring to the Building. In the event that at any time Owner's fire insurance
carriers shall exact an additional premium for the inclusion of such or similar
provisions, Owner shall give Tenant notice thereof. In such event, if Tenant
agrees, in writing, to reimburse Owner for such additional premium for the
remainder of the Demised Term, Owner shall require the inclusion of such or
similar provisions by Owner's fire insurance carriers. As long as such or
similar provisions are included in Owner's fire insurance and "all-risk"
policies then in force, or if substantially all fire insurance companies
licensed to do business in New York State (referred to as "New York State
--------------
Insurance Companies") include such provisions as a matter of course and Owner
-------------------
fails to carry fire insurance containing such provisions, Owner hereby waives
(i) any obligation on the part of Tenant to make repairs to the Demised Premises
and the Building necessitated or occasioned by fire or other casualty that is an
insured risk under such policies, and (ii) any right of recovery or claim
against Tenant, any other permitted occupant of the Demised Premises, and any of
their servants, employees, agents or
13
contractors, for any loss occasioned by fire or other casualty which is an
insured risk under such policies and Owner shall look solely to such policies to
compensate Owner for any such loss. In the event that at any time Owner's fire
insurance carriers shall not include such or similar provisions in Owner's fire
insurance policies, and substantially all New York State Insurance Companies no
longer include such provisions as a matter of course, the waivers set forth in
the foregoing sentence shall, upon notice given by Owner to Tenant, be deemed of
no further force or effect and Owner shall have Tenant named in said policies as
an assured party, but not as a loss payee, provided that if at any time Owner's
fire insurance carriers shall exact an additional premium for naming Tenant as
an assured party, Tenant shall agree, in writing, to reimburse Owner for such
additional premium for the remainder of the Demised Term for so long as Tenant
shall elect to be an assured party. In the event Tenant shall be named in such
policies as an assured party in accordance with the foregoing provisions of this
Section, Tenant agrees to endorse promptly, without recourse, any check, draft
or order for the payment of money representing the proceeds of any such policies
or representing any other payment growing out of or in connection with any such
policies, and in the event Tenant does not promptly endorse such check, draft or
order, then Owner shall have the right as Tenant's attorney-in-fact, to make
such endorsement on behalf of Tenant, and Tenant does hereby irrevocably waive
any rights to participate in any settlement proceedings and further hereby
waives any and all rights in and to any such proceeds and payments.
Section 9.03. Tenant Negligence: Except to the extent expressly
-----------------
provided in Section 9.02, nothing contained in this Lease shall relieve Tenant
of any liability to Owner or to its insurance carriers which Tenant may have
under law or the provisions of this Lease in connection with any damage to the
Demised Premises or the Building caused by fire or other casualty.
Notwithstanding the provisions of Section 9.01, if any such damage, occurring
after any date when the waivers set forth in Section 9.02 are no longer in force
and effect, is due to the fault or neglect of Tenant, any person claiming
through or under Tenant, or any of their servants, employees, agents,
contractors, visitors or licensees, then there shall be no abatement of Fixed
Rent by reason of such damage.
Section 9.04. Tenant Subrogation Waiver Provisions: Tenant
------------------------------------
acknowledges that it has been advised that Owner's insurance policies do not
cover Tenant's Personal Property or any other property of Tenant in the Demised
Premises; accordingly, it shall be Tenant's obligation to obtain and maintain
insurance covering its property in the Demised Premises and loss of profits
including, but not limited to, water damage coverage and business interruption
insurance. Tenant shall attempt to obtain and maintain, throughout the Demised
Term, in Tenant's fire and other insurance policies covering Tenant's Personal
Property and other property of Tenant in the Demised Premises, and Tenant's use
and occupancy of the Demised Premises, and/or Tenant's profits (and shall cause
any other permitted occupants of the Demised Premises to attempt to obtain and
maintain, in similar policies), provisions to the effect that such policies
shall not be invalidated should the insured waive, in writing, prior to a loss,
any or all right of recovery against any party for loss occasioned by fire or
other casualty which is an insured risk under such policies. In the event that
at any time the fire insurance carriers issuing such policies shall exact an
additional premium for the inclusion of such or similar provisions, Tenant shall
give Owner notice thereof. In such event, if Owner agrees, in writing, to
reimburse Tenant or any person claiming through or under Tenant, as the case may
be, for such additional premium for the remainder of the Demised Term, Tenant
shall require the inclusion of such or similar provisions by such insurance
carriers. As long as such or similar provisions are included in such insurance
policies then in force, Tenant hereby waives (and agrees to cause any other
permitted occupants of the Demised Premises to execute and deliver to Owner
written instruments waiving) any right of recovery against Owner, any lessors
under any Superior Leases, the holders of any Mortgage, and all other tenants or
occupants of the Building, and any servants, employees, agents or contractors of
Owner, or of any such lessor, or holder or any such other tenants or occupants,
for any loss occasioned by fire or other casualty which is an insured risk under
such policies. In the event that at any time such insurance carriers shall not
include such or similar provisions in any such insurance policy, the waiver set
forth in the foregoing sentence (or in any written instrument executed by any
other permitted occupant of the Demised Premises) shall, upon notice given by
Tenant to Owner, be deemed of no further force or effect with respect to any
insured risks under such policy from and after the giving of such notice. During
any period while any such waiver of right of recovery is in effect, Tenant, or
any other permitted occupant of the Demised Premises, as the case may be, shall
look solely to the proceeds of such policies to compensate Tenant or such other
permitted occupant for any loss occasioned by fire or other casualty which is an
insured risk under such policies.
14
Section 9.05. Owner agrees, during the Demised Term, to obtain and
keep in full force and effect insurance against loss or damage by fire or other
casualty to the Building and to all of Owner's property referred to in Article 4
as may be insurable under then obtainable standard forms of "all-risk" insurance
policies in an amount equal to not less than (i) the amount sufficient to avoid
coinsurance or (ii) eighty (80%) percent of the replacement value of the
Building and such property exclusive of footings and foundations, whichever is
greater.
ARTICLE 10
EMINENT DOMAIN
--------------
Section 10.01. Taking of the Demised Premises: If the whole or any
------------------------------
material and substantial portion of the Demised Premises shall be acquired for
any public or quasi-public use or purpose, whether by condemnation or by deed in
lieu of condemnation, this Lease and the Demised Term shall end as of the date
of the vesting of title with the same effect as if said date were the Expiration
Date. If only a part of the Demised Premises shall be so acquired or condemned
then, except as otherwise provided in this Section, this Lease and the Demised
Term shall continue in force and effect but, from and after the date of the
vesting of title, the Fixed Rent shall be reduced in the proportion which the
area of the part of the Demised Premises so acquired or condemned bears to the
total area of the Demised Premises immediately prior to such acquisition or
condemnation. If only a part of the Real Property shall be so acquired or
condemned, then (i) whether or not the Demised Premises shall be affected
thereby, Owner, at Owner's option, may give to Tenant, within sixty (60) days
next following the date upon which Owner shall have received notice of vesting
of title, a five (5) days' notice of termination of this Lease, and (ii) if the
part of the Real Property so acquired or condemned shall contain more than ten
(10%) percent of the total area of the Demised 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 Demised
Premises, Tenant, at Tenant's option, may give to Owner, within sixty (60) days
next following the date upon which Tenant shall have received notice of vesting
of title, a five (5) days' notice of termination of this Lease. In the event
any such five (5) days' notice of termination is given, by Owner or Tenant, this
Lease and the Demised Term shall come to an end and expire upon the expiration
of said five (5) days with the same effect as if the date of expiration of said
five (5) days were the Expiration Date. If a part of the Demised Premises shall
be so acquired or condemned and this Lease and the Demised Term shall not be
terminated pursuant to the foregoing provisions of this Section, Owner, at
Owner's expense, shall restore that part of the Demised Premises not so acquired
or condemned to a self-contained rental unit. In the event of any termination
of this Lease and the Demised Term pursuant to the provisions of this Section,
the Fixed Rent shall be apportioned as of the date of such termination and any
prepaid portion of Fixed Rent for any period after such date shall be refunded
by Owner to Tenant.
Section 10.02. Condemnation Award or Claims: In the event of any such
----------------------------
acquisition or condemnation of all or any part of the Real Property, Owner shall
be entitled to receive the entire award for any such acquisition or
condemnation, Tenant shall have no claim against Owner or the condemning
authority for the value of any unexpired portion of the Demised Term and Tenant
hereby expressly assigns to Owner all of its right in and to any such award.
Nothing contained in this Section shall be deemed to prevent Tenant from making
a claim in any condemnation proceedings for the value of any items of Tenant's
Personal Property which are compensable, in law, as trade fixtures, or provided
that such claim is authorized by law and will not in any way diminish the award
to which Owner would be entitled if no such claim were made, for Tenant's moving
and/or re-location expenses.
15
ARTICLE 11
ASSIGNMENT AND SUBLETTING
-------------------------
Section 11.01. General Covenant: Except as expressly set forth in
----------------
this Article 11, Tenant, for itself, its heirs, distributees, executors,
administrators, legal representatives, successors and assigns, covenants that,
without the prior consent of Owner in each instance, it shall not (i) assign
whether by merger, consolidation or otherwise, mortgage or encumber its interest
in this Lease, in whole or in part, or (ii) sublet, or permit the subletting of,
the Demised Premises or any part thereof, or (iii) permit the Demised Premises
or any part thereof to be occupied, or used for desk space, mailing privileges
or otherwise, by any person other than Tenant. The sale, pledge, transfer or
other alienation of (a) a controlling interest in the issued and outstanding
capital stock of any corporate Tenant (unless such stock is publicly traded on a
recognized security exchange or over-the counter market) or (b) a controlling
interest in any partnership, limited liability company or joint venture or other
business entity comprising Tenant, however accomplished, and whether in a single
transaction or in a series of related and/or unrelated transactions, shall be
deemed for the purposes of this Section as an assignment of this Lease which
shall require the prior consent of Owner in each instance. For the purposes of
this Section and Section 11.03, the word "controlling" shall have the same
meaning as the word "control" set forth in Section 11.05. Notwithstanding
anything to the contrary contained in this Lease, a public offering of the stock
of Tenant named herein on a recognized security exchange or over-the-counter
market shall not be considered an assignment of this Lease requiring the prior
approval of Owner.
Section 11.02. Owner's Rights Upon Assignment: If Tenant's interest
------------------------------
in this Lease is assigned, whether or not in violation of the provisions of this
Article, Owner may collect rent from the assignee; if the Demised Premises or
any part thereof are sublet to, or occupied by, or used by, any person other
than Tenant, whether or not in violation of this Article, Owner, after default
by Tenant under this Lease, may collect rent from the subtenant, user or
occupant. In either case, Owner shall apply the net amount collected to the
rents reserved in this Lease, but neither any such assignment, subletting,
occupancy, or use, whether with or without Owner's prior consent, nor any such
collection or application, shall be deemed a waiver of any term, covenant or
condition of this Lease or the acceptance by Owner of such assignee, subtenant,
occupant or user as tenant. The consent by Owner to any assignment, subletting,
occupancy or use shall not relieve Tenant from its obligation to obtain the
express prior consent of Owner to any further assignment, subletting, occupancy
or use. If this Lease is assigned to any person or entity pursuant to any
proceeding of the type referred to in Subsections 16.01(c) and 16.01(d), any and
all monies or other consideration payable or otherwise to be delivered in
connection with such assignment shall be paid or delivered to Owner, shall be
and remain the exclusive property of Owner and shall not constitute property of
Tenant or of the estate of Tenant within the meaning of any proceeding of the
type referred to in Subsections 16.01(c) and 16.01(d). Any and all monies or
other considerations constituting Owner's property under the preceding sentence
not paid or delivered to Owner shall be held in trust for the benefit of Owner
and shall be promptly paid to or turned over to Owner. Any person or entity to
which this Lease is assigned pursuant to any proceeding of the type referred to
in Subsections 16.01(c) and 16.01(d) shall be deemed without further act or deed
to have assumed all of the obligations arising under this Lease on and after the
date of such assignment. Any such assignee shall execute and deliver to Owner
upon demand an instrument confirming such assumption. The listing of any name
other than that of Tenant on any door of the Demised Premises or on any
directory or in any elevator in the Building, or otherwise, shall not operate to
vest in the person so named any right or interest in this Lease or in the
Demised Premises, or the Building, or be deemed to constitute, or serve as a
substitute for, any prior consent of Owner required under this Article, and it
is understood that any such listing shall constitute a privilege extended by
Owner which shall be revocable at Owner's will by notice to Tenant. Tenant
agrees to pay to Owner reasonable counsel fees not to exceed THREE THOUSAND and
00/100 ($3,000.00) DOLLARS in any single instance incurred by Owner in
connection with any proposed assignment of Tenant's interest in this Lease or
any proposed subletting of the Demised Premises or any part thereof. Neither
any assignment of Tenant's interest in this Lease nor any subletting, occupancy
or use of the Demised Premises or any part thereof by any person other than
Tenant, nor any collection of rent by Owner from any person other than Tenant as
provided in this Section, nor any application of any such rent as provided in
this Section shall, in any circumstances, relieve Tenant of its obligation fully
to observe and perform the terms, covenants and conditions of this Lease on
Tenant's part to be observed or performed.
16
Section 11.03. Sublet Rights: A. (1) As long as Tenant is not in
-------------
default under any of the terms, covenants or conditions of this Lease on
Tenant's part to be observed or performed, Owner agrees not to unreasonably
withhold Owner's prior consent to a subletting by Tenant of all or a portion of
the Demised Premises to one (1) subtenant for undivided occupancy by such
subtenant, for the use expressly permitted in this Lease.
(2) Without Owner's prior consent, Tenant shall not (a)
negotiate or enter into a proposed subletting with any tenant, subtenant or
occupant of any space in the Building or (b) list or otherwise publicly
advertise the Demised Premises or any part thereof for subletting at a rental
lower than the rental at which the Owner is then offering to rent comparable
space in the Building.
(3) At least thirty (30) days prior to any proposed
subletting, Tenant shall submit to Owner a statement (the "Proposed Sublet
---------------
Statement") containing the name and address of the proposed subtenant, the
---------
nature of the proposed subtenant's business and its current financial status, if
such status is obtained by Tenant, and all of the principal terms and conditions
of the proposed subletting including, but not limited to, the proposed
commencement and expiration dates of the term thereof.
(4) Owner may withhold consent to a proposed subletting if,
(a) in Owner's reasonable judgment, the occupancy of the proposed subtenant will
tend to impair the character or dignity of the Building or impose any additional
burden upon Owner in the operation of the Building, or (b) in Owner's reasonable
judgment, the occupancy of the proposed subtenant will tend to impair the
reputation of (i) the Building as an information technology center or (ii) the
floor on which the Demised Premises are located as a floor devoted to
information technology tenants or (c) the proposed subtenant shall be a person
or entity with whom Owner is then negotiating or discussing to lease space in
the Building or (d) if Owner shall have any other reasonable objections to such
subletting.
(5) In the event of any dispute between Owner and Tenant as
to the reasonableness of Owner's failure or refusal to consent to any
subletting, such dispute shall be submitted to arbitration in accordance with
the provisions of Article 36.
(6) Tenant shall reimburse Owner on demand for any
reasonable costs or expense that may be incurred by Owner's review of any
Proposed Sublet Statement or in connection with any sublease consented to by
Owner, including, without limitation, any reasonable processing fee, reasonable
attorneys' fees and disbursements and the reasonable costs of making
investigations as to the acceptability of the proposed subtenant.
B. Notwithstanding the foregoing provisions of this Section
11.03, Owner shall have the following rights with respect to each proposed
subletting by Tenant:
(1) in the event Tenant proposes to sublet the Demised
Premises, whether or not such subletting is for all or substantially all of the
remainder of the Demised Term, Owner, at Owner's option, may give to Tenant,
within thirty (30) days after the submission by Tenant to Owner of the Proposed
Sublet Statement, a notice terminating this Lease on the date (referred to as
the "Earlier Termination Date") immediately prior to the proposed commencement
------------------------
date of the term of the proposed subletting, as set forth in the Proposed Sublet
Statement, and, in the event such notice is given, this Lease and the Demised
Term shall come to an end and expire on the Earlier Termination Date with the
same effect as if it were the Expiration Date, the Fixed Rent shall be
apportioned as of said Earlier Termination Date and any prepaid portion of Fixed
Rent for any period after such date shall be refunded by Owner to Tenant; or
(2) In the event Tenant proposes to sublet the Demised
Premises for less than substantially all of the remainder of the Demised Term,
Owner, at Owner's option, may give to Tenant, within thirty (30) days after the
submission by Tenant to Owner, of the Proposed Sublet Statement required to be
submitted in connection with such proposed subletting, a notice electing to
recapture the Demised Premises during the period (referred to as the "Recapture
---------
Period") commencing on the date (referred to as "Recapture Date") immediately
------ --------------
prior to
17
the proposed commencement date of the term of the proposed subletting, as set
forth in the Proposed Sublet Statement, and ending on the proposed expiration
date of the term of the proposed subletting, as set forth in the Proposed Sublet
Statement, and in the event such notice is given the following shall apply:
(a) The Demised Premises shall be recaptured by Owner during the
Recapture Period;
(b) Tenant shall surrender the Demised Premises to Owner on or
prior to the Recapture Date in the same manner as if said Date
were the Expiration Date;
(c) During the Recapture Period Tenant shall have no rights with
respect to the Demised Premises nor any obligations with respect
to the Demised Premises, including, but not limited to, any
obligations to pay Fixed Rent or any increases therein or any
additional rent, and any prepaid portion of Fixed Rent allocable
to the Recapture Period shall be refunded by Owner to Tenant;
(d) There shall be an equitable apportionment of any increase in
the Fixed Rent pursuant to Article 23 for the Escalation Year and
Tax Escalation Year (as defined in Article 23) in which said
Recapture Date shall occur;
(e) Upon the expiration of the Recapture Period, the Demised
Premises, in its then existing condition, shall be deemed
restored to Tenant and Tenant shall have all rights with respect
to the Demised Premises which are set forth in this Lease and all
obligations with respect to the Demised Premises which are set
forth in this Lease, including, but not limited to, the
obligations for the payment of Fixed Rent and any increases
therein and any additional rent (as they would have been adjusted
if Tenant occupied the Demised Premises during the Recapture
Period) during the period (referred to as the "Recapture
---------
Restoration Period") commencing on the date next following the
------------------
expiration of the Recapture Period and ending on the Expiration
Date, except in the event that Owner is unable to give Tenant
possession of the Demised Premises at the expiration of the
Recapture Period by reason of the holding over or retention of
possession of any tenant or other occupant, in which event (x)
the Recapture Restoration Period shall not commence and the
Demised Premises shall not be deemed available for Tenant's
occupancy and Tenant shall not be required to comply with the
obligations of Tenant under this Lease until the date upon which
Owner shall give Tenant possession of the Demised Premises free
of occupancies, (y) neither the Expiration Date nor the validity
of this Lease nor the obligations of Tenant under this Lease
shall be affected thereby, and (z) Tenant waives any rights to
rescind this Lease and to recover any damages which may result
from the failure by Owner to deliver possession of the Demised
Premises at the end of the Recapture Period; Owner agrees to
institute, within thirty (30) days after the expiration of the
Recapture Period, possession proceedings against any tenants and
occupants who have not so vacated and surrendered all or any
portions of the Demised Premises and agrees to prosecute such
proceedings with reasonable diligence; and
(f) There shall be an equitable apportionment of any increase in
the Fixed Rent pursuant to Article 23 for the Escalation Year and
Tax Escalation Year in which the Recapture Restoration Period
shall commence.
At the request of Owner, Tenant shall execute and deliver an instrument or
instruments, in form satisfactory to Owner, setting forth any modifications to
this Lease contemplated in or resulting from the operation of the foregoing
provisions of this Subsection 11.03; however, neither Owner's failure to request
any such instrument nor Tenant's failure to execute or deliver any such
instrument shall vitiate the effect of the foregoing provisions of this Section.
The failure by Owner to exercise any option under this Section 11.03 with
respect to any subletting shall not be deemed a waiver of such option with
respect to any extension of such subletting or any subsequent subletting of the
premises affected thereby
18
or any other portion of the Demised Premises. Tenant shall indemnify Owner from
all loss, cost, liability, damage and expense, including, but not limited to,
reasonable counsel fees and disbursements, arising from any claims against Owner
by any broker or other person, for a brokerage commission or other similar
compensation in connection with any such proposed subletting, in the event (a)
Owner shall (i) fail or refuse to consent to any proposed subletting, or (ii)
exercise any of its options under this Section 11.03, or (b) any proposed
subletting shall fail to be consummated for any reason whatsoever.
C. Tenant agrees that (1) seventy-five (75%) percent of
any increase in the rental value of the Demised Premises over and above the
Fixed Rent payable pursuant to the provisions of this Lease, as such Fixed Rent
may be increased from time to time pursuant to the provisions of this Lease, and
(2) any consideration paid to Tenant or any subtenant or other person claiming
through or under Tenant in connection with an assignment of Tenant's interest in
this Lease or the interest of any subtenant or other person claiming through or
under Tenant under any sublease whether or not such assignment shall be effected
with court approval in a proceeding of the types described in Subsection
16.01(c) or (d), or in any similar proceeding, or otherwise, shall accrue to the
benefit of Owner and not to the benefit of Tenant, or of any subtenant or other
person claiming through or under Tenant, or of the creditors of Tenant or of any
such subtenant or other person claiming through or under Tenant. Accordingly,
Tenant agrees that if Owner shall fail to exercise its option to sooner
terminate this Lease or its option to recapture the Demised Premises in
connection with any proposed subletting by Tenant, or if any subtenant or other
person claiming through or under Tenant shall sublet all or any portion of the
Demised Premises, Tenant shall pay to Owner a sum equal to seventy-five (75%)
percent of any Subletting Profit, as such term is hereinafter defined. All
rentals and other sums (including, but not limited to, sums payable for the sale
or rental of any fixtures, leasehold improvements, equipment, furniture or other
personal property, less, in the case of the sale thereof, the then net
unamortized [on a straight-line basis over the term of this Lease or, in the
event of a further subletting, over the term of the initial sublease, as the
case may be] cost thereof, which were provided and installed in the sublet
premises at the sole cost and expense of Tenant or such subtenant or other
person claiming through or under Tenant and for which no allowance or other
credit has been given by Owner) payable by any subtenant to Tenant or to any
subtenant or other person claiming through or under Tenant in connection with
any subletting in excess of the Fixed Rent then payable by Tenant to Owner under
this Lease are referred to, in the aggregate, as "Subletting Profit"; in
-----------------
computing any Subletting Profit it shall be deemed that the rental reserved
under any such subletting shall commence to accrue as of the commencement of the
term of such subletting even if such rental actually commences to accrue as of a
date subsequent to such commencement and there shall be first deducted
reasonable alteration expenses and reasonable legal fees with respect to such
subletting and a reasonable single brokerage commission, if any such commission
shall be paid by Tenant or any such subtenant or other person claiming through
or under Tenant in connection with such subletting. Owner and Tenant agree that
if Tenant, or any subtenant or other person claiming through or under Tenant,
shall assign or have assigned its interest as Tenant under this Lease or its
interest as subtenant under any sublease as the case may be, whether or not such
assignment shall be effected with court approval in a proceeding of the types
described in Subsections 16.01(c) or (d), or in any similar proceeding, or
otherwise, Tenant shall pay to Owner a sum equal to any consideration paid to
Tenant or any subtenant or other person claiming through or under Tenant for
such assignment. All sums payable hereunder to Tenant shall be paid to Owner as
additional rent immediately upon such sums becoming payable to Tenant or to any
subtenant or other person claiming through or under Tenant and, if requested by
Owner, Tenant shall promptly enter into a written agreement with Owner setting
forth the amount of such sums to be paid to Owner, however, neither Owner's
failure to request the execution of such agreement nor Tenant's failure to
execute such agreement shall vitiate the provisions of this Section. For the
purposes of this Section, a trustee, receiver or other representative of the
Tenant's or any subtenant's estate under any federal or state bankruptcy act
shall be deemed a person claiming through or under Tenant.
D. Neither Owner's consent to any subletting nor anything
contained in this Section shall be deemed to grant to any subtenant or other
person claiming through or under Tenant the right to sublet all or any portion
of the Demised Premises or to permit the occupancy of all or any portion of the
Demised Premises by others. Neither any subtenant referred to in this Section
nor its heirs, distributees, executors, administrators, legal representatives,
successors nor assigns, without the prior consent of Owner in each instance,
shall (i) assign, whether by merger, consolidation or otherwise, mortgage or
encumber its interest in any sublease, in whole or in part, or (ii) sublet, or
permit the subletting of, that part of the Demised Premises affected by such
subletting or any portion thereof,
19
or (iii) permit such part of the Demised Premises affected by such subletting or
any part thereof to be occupied or used for desk space, mailing privileges or
otherwise, by any person other than such subtenant and any sublease shall
provide that any violation of the foregoing provisions of this sentence shall be
an event of default thereunder. The sale, pledge, transfer or other alienation
of (a) a controlling interest in the issued and outstanding capital stock of any
corporate subtenant (unless such stock is publicly traded on any recognized
security exchange or over-the-counter market) or (b) a controlling interest in
any partnership or joint venture subtenant, however accomplished, and whether in
a single transaction or in a series of related or unrelated transactions, shall
be deemed for the purposes of this Section to be an assignment of such sublease
which shall require the prior consent of Owner in each instance and any sublease
shall so provide.
Section 11.04. Owner's Rights Upon Lease Disaffirmance: A. In the
---------------------------------------
event that, at any time after Tenant may have assigned Tenant's interest in this
Lease, this Lease shall be disaffirmed or rejected in any proceeding of the
types described in Subsections 16.01(c) and (d), or in any similar proceeding,
or in the event of termination of this Lease by reason of any such proceeding or
by reason of lapse of time following notice of termination given pursuant to
Section 16.01 based upon any of the Events of Default set forth in said
Subsections, Tenant, upon request of Owner given within thirty (30) days next
following any such disaffirmance, rejection or termination (and actual notice
thereof to Owner in the event of a disaffirmance or rejection or in the event of
termination other than by act of Owner), shall (i) pay to Owner all Fixed Rent,
additional rent and other charges due and owing by the assignee to Owner under
this Lease to and including the date of such disaffirmance, rejection or
termination, and (ii) as "tenant", enter into a new lease with Owner of the
Demised Premises for a term commencing on the effective date of such
disaffirmance, rejection or termination and ending on the Expiration Date unless
sooner terminated as in such lease provided, at the same Fixed Rent and then
executory terms, covenants and conditions as are contained in this Lease, except
that (a) Tenant's rights under the new lease shall be subject to the possessory
rights of the assignee under this Lease and the possessory rights of any person
claiming through or under such assignee or by virtue of any statute or of any
order of any court, and (b) such new lease shall require all defaults existing
under this Lease to be cured by Tenant with due diligence, and (c) such new
lease shall require Tenant to pay all increases in the Fixed Rent reserved in
this Lease which, had this Lease not been so disaffirmed, rejected or
terminated, would have accrued under the provisions of Article 23 of this Lease
after the date of such disaffirmance, rejection or termination with respect to
any period prior thereto. In the event Tenant shall default in its obligation
to enter into said new lease for a period of ten (10) days next following
Owner's request therefor, then, in addition to all other rights and remedies by
reason of such default, either at law or in equity, Owner shall have the same
rights and remedies against Tenant as if Tenant had entered into such new lease
and such new lease had thereafter been terminated as at the commencement date
thereof by reason of Tenant's default thereunder. Nothing contained in this
Section shall be deemed to grant to Tenant any right to assign Tenant's interest
in this Lease.
Section 11.05. Subsidiary/Affiliate: A. As long as Tenant is not in
--------------------
default under any of the terms, covenants or conditions of this Lease on
Tenant's part to be observed and performed, Tenant named herein shall have the
right, without the prior consent of Owner, to assign its interest in this Lease,
for the use permitted in this Lease, to any subsidiary or affiliate of Tenant
named herein, which is in the same general line of business as Tenant named
herein and only for such period as it shall remain such subsidiary or affiliate.
For the purposes of this Article: (a) a "subsidiary" of Tenant named herein
shall mean any corporation not less than fifty-one (51%) percent of whose
outstanding voting stock at the time shall be owned or controlled by Tenant
named herein, and (b) an "affiliate" of Tenant named herein shall mean Tenant's
parent and any corporation, partnership or other business entity which controls
or is controlled by, or is under common control with Tenant. For the purpose of
the definition of "affiliate" the word "control" (including, "controlled by" and
"under common control with") as used with respect to any corporation,
partnership or other business entity, shall mean the possession of the power to
direct or cause the direction of the management and policies of such
corporation, partnership or other business entity, whether through the ownership
of voting securities or contract. No such assignment shall be valid or
effective unless, within ten (10) days after the execution thereof, Tenant shall
deliver to Owner all of the following: (I) a duplicate original instrument of
assignment, in form and substance reasonably satisfactory to Owner and Tenant,
duly executed by Tenant, in which Tenant shall (a) waive all notices of default
given to the assignee, and all other notices of every kind or description now or
hereafter provided in this Lease, by statute or rule of law, and (b) acknowledge
that Tenant's obligations with respect to this Lease
20
shall not be discharged, released or impaired by (i) such assignment, (ii) any
amendment or modification of this Lease, whether or not the obligations of
Tenant are increased thereby, (iii) any further assignment or transfer of
Tenant's interest in this Lease, (iv) any exercise, non-exercise or waiver by
Owner of any right, remedy, power or privilege under or with respect to this
Lease, (v) any waiver, consent, extension, indulgence or other act or omission
with respect to any other obligations of Tenant under this Lease, (vi) any act
or thing which, but for the provisions of such assignment, might be deemed a
legal or equitable discharge of a surety or assignor, to all of which Tenant
shall consent in advance, it being the purpose and intent of Owner and Tenant
that the obligations of Tenant hereunder as assignor shall be absolute and
unconditional under any and all circumstances, and (II) an instrument, in form
and substance reasonably satisfactory to Owner and such assignee, duly executed
by the assignee, in which such assignee shall assume the observance and
performance of, and agree to be bound by, all of the terms, covenants and
conditions of this Lease on Tenant's part to be observed and performed.
B. As long as Tenant is not in default under any of the
terms, covenants or conditions of this Lease on Tenant's part to be observed and
performed, Tenant named herein shall have the right without the prior consent of
Owner, to sublet to, or permit the use or occupancy of, all or any part of the
Demised Premises by any subsidiary or affiliate (as said terms are defined in
Section 11.05A.) of Tenant named herein for the use permitted in this Lease
provided that such subsidiary or affiliate is in the same general line of
business as the Tenant named herein and only for such period as it shall remain
such subsidiary or affiliate and in the same general line of business as the
Tenant named herein. However, no such subletting shall be valid unless, prior to
the execution thereof, Tenant shall give notice to Owner of the proposed
subletting, and within ten (10) days prior to the commencement of said
subletting, Tenant shall deliver to Owner an agreement, in form and substance
reasonably satisfactory to Owner and Tenant, duly executed by Tenant and said
subtenant, in which said subtenant shall assume performance of and agree to be
bound by, all of the terms, covenants and conditions of this Lease which are
applicable to said subtenant and such subletting. Tenant shall give prompt
notice to Owner of any such use or occupancy of all or any part of the Demised
Premises and such use or occupancy shall be subject and subordinate to all of
the terms, covenants and conditions of this Lease. No such use or occupancy
shall operate to vest in the user or occupant any right or interest in this
Lease or the Demised Premises. For the purposes of determining the number of
subtenants or occupants in the Demised Premises, the occupancy of any such
permitted subsidiary or affiliate of Tenant shall be deemed the occupancy of
Tenant and such subsidiary or affiliate shall not be counted as a subtenant or
occupant for the purposes of Section 11.03 and the provisions of Section 11.03
relating to Owner's option to terminate this Lease and recapture any portions of
the Demised Premises and the provisions of Section 11.03 relating to Subletting
Profits shall not be applicable to any proposed subletting to any such
subsidiary or affiliate of Tenant pursuant to the provisions of this Section.
Section 11.06. Merger/Consolidation: As long as Tenant is not then
--------------------
in default under any of the terms, covenants or conditions of this Lease on
Tenant's part to be observed or performed, Owner's consent shall not be required
for an assignment of Tenant's interest in this Lease to any person, corporation,
partnership, or other business entity which is a successor of Tenant, either by
merger or consolidation or the purchase of all or substantially all of the
stock, assets, business and goodwill of Tenant named herein, provided that said
person, corporation, partnership or other business entity shall have a net
worth, as determined in accordance with generally accepted accounting principles
consistently applied, at least equal to that of Tenant named herein as of the
date of this Lease, and provided further that such successor, person,
corporation, partnership or other business entity shall continue to operate
Tenant's present business in the Demised Premises and the interest of Tenant
named herein in this Lease is not the sole or principal asset of Tenant named
herein and such assignment is made for a good business purpose. At or about the
time of said proposed assignment, Tenant shall deliver to Owner a reasonably
detailed statement of the financial condition of the aforesaid proposed
assignee, prepared in accordance with generally accepted accounting principles
applied on a consistent basis, sworn to by an executive officer or principal or
partner of Tenant and the proposed Assignee, or certified without qualification
by a firm of reputable independent certified public accountants which statement
shall reflect the financial condition of the aforesaid proposed assignee at that
time. Notwithstanding anything contained in this Section to the contrary, such
assignment shall not be valid if the aforesaid proposed assignee shall not have
a net worth at least equal to that of Tenant as of the date of this Lease or the
interest of Tenant named herein in this Lease is the sole or principal asset of
Tenant named herein or such assignment is not made for a good business purpose.
In the event of any dispute between Owner and Tenant as to the validity of any
such assignment such dispute shall be determined by arbitration
21
in the City of New York in accordance with the provisions of Section 36.01. Any
such determination shall be final and binding upon the parties whether or not a
judgment shall be entered in any court. If the determination of any such
arbitration shall be adverse to Owner, Owner, nevertheless, shall not be liable
to Tenant and Tenant's sole remedy in such event shall be to have the proposed
assignment deemed valid. Other than with respect to any instance where Tenant
named herein, Bottomline Technologies, Inc., is merged into another entity, no
such assignment shall be valid, unless, within ten (10) days after the execution
thereof, Tenant shall deliver to Owner (I) a duplicate original instrument of
assignment in form and substance reasonably satisfactory to Owner duly executed
by Tenant, acknowledged before a notary public, in customary and reasonable form
and substance in which Tenant shall (a) waive all notices of default given to
the assignee and all other notices of every kind or description, now or
hereafter provided in this Lease, by statute or by rule of law; (b) acknowledge
that Tenant's obligations with respect to this Lease shall not be discharged,
released or impaired by (i) such assignment; (ii) any amendment or modification
of this Lease (whether or not the obligations of Tenant are increased thereby);
(iii) any further assignment or transfer of Tenant's interest in this Lease;
(iv) any exercise, non- exercise or waiver by Owner of any right, remedy, power
or privilege under or with respect to this Lease; (v) any waiver, consent,
extension, indulgence or other act or omission with respect to any of the
obligations of Tenant under this Lease; (vi) any act or thing which, but for the
provisions of such assignment, might be deemed a legal or equitable discharge of
a surety or assignor, to all of which Tenant shall consent in advance; it being
the purpose and intent of Owner and Tenant that the obligations of Tenant
hereunder as assignor shall be absolute and unconditional under any and all
circumstances; and (II) an instrument in form and substance reasonably
satisfactory to Owner, duly executed by the proposed assignee, acknowledged
before a notary public, in which such proposed assignee shall assume observance
and performance of, and agree to be bound by, all of the terms, covenants and
conditions of this Lease on Tenant's part to be performed.
ARTICLE 12
EXISTING CONDITIONS
-------------------
Section 12.01. Existing Conditions: Tenant acknowledges that, except
-------------------
as otherwise expressly set forth herein, Owner has made no representations to
Tenant with respect to the condition of the Demised Premises and Tenant agrees
to accept possession of the Demised Premises in the condition which shall exist
on the Commencement Date "as is" and further agrees that Owner shall have no
obligation to perform any work or make any installations in order to prepare the
Demised Premises for Tenant's occupancy, other than deliver the Demised Premises
in broom clean order and condition and free of all tenancies and occupancies and
personalty.
22
ARTICLE 13
ACCESS TO DEMISED PREMISES
--------------------------
Section 13.01. Owner's Right to Enter: Owner and its agents shall
----------------------
have the following rights in and about the Demised Premises: (i) to enter the
Demised Premises without notice in cases of emergency and upon reasonable
advance notice (which may be delivered personally at the Demised Premises) in
other cases, in each case at all times to examine the Demised Premises or for
any of the purposes set forth in this Article or for the purpose of performing
any obligation of Owner under this Lease or exercising any right or remedy
reserved to Owner in this Lease, or complying with any Legal Requirement which
Owner is obligated to comply with hereunder, and if Tenant, its officers,
partners, agents or employees shall not be personally present or shall not open
and permit an entry into the Demised Premises at any time when such entry shall
be necessary or permissible, to use a master key or to forcibly enter the
Demised Premises; (ii) to erect, install, use and maintain pipes, ducts and
conduits in and through the Demised Premises; (iii) to exhibit the Demised
Premises to others; (iv) to make such decorations, repairs, alterations,
improvements or additions, or to perform such maintenance, including, but not
limited to, the maintenance of all heating, air conditioning, ventilating,
elevator, plumbing, electrical, telecommunication and other mechanical
facilities, as Owner may deem necessary or desirable; (v) to take all materials
into and upon the Demised Premises that may be required in connection with any
such decorations, repairs, alterations, improvements, additions or maintenance;
and (vi) to alter, renovate and decorate the Demised Premises at any time during
the Demised Term if Tenant shall have removed all or substantially all of
Tenant's property from the Demised Premises. The lessors under any Superior
Lease and the holders of any Mortgage shall have the right to enter the Demised
Premises from time to time through their respective employees, agents,
representatives and architects to inspect the same or to cure any default of
Owner or Tenant relating thereto. Owner shall have the right, from time to time,
to change the name, number or designation by which the Building is commonly
known which right shall include, without limitation, the right to name the
Building after any tenant of the Building.
Section 13.02. Owner's Reservation of Rights to Portions of the
------------------------------------------------
Building: All parts (except surfaces facing the interior of the Demised
--------
Premises) of all walls, windows and doors bounding the Demised Premises
(including exterior Building walls, core corridor walls, doors and entrances),
all balconies, terraces and roofs adjacent to the Demised Premises, all space in
or adjacent to the Demised Premises used for shafts, stacks, stairways, chutes,
pipes, conduits, ducts, fan rooms, heating, air conditioning, ventilating,
plumbing, electrical, telecommunication and other mechanical facilities,
closets, service closets and other Building facilities, and the use thereof, as
well as access thereto through the Demised Premises for the purposes of
operation, maintenance, alteration and repair, are hereby reserved to Owner.
Owner also reserves the right at any time to change the arrangement or location
of entrances, passageways, doors, doorways, corridors, elevators, stairs,
toilets and other public parts of the Building, provided any such change does
not permanently and unreasonably obstruct Tenant's access to or use of the
Demised Premises. Nothing contained in this Article shall impose any obligation
upon Owner with respect to the operation, maintenance, alteration or repair of
the Demised Premises or the Building.
Section 13.03. Access to Third Parties: Owner and its agents shall
-----------------------
have the right to permit access to the Demised Premises, whether or not Tenant
shall be present, to any receiver, trustee, assignee for the benefit of
creditors, sheriff, marshal or court officer entitled to, or reasonably
purporting to be entitled to, such access for the purpose of taking possession
of, or removing, any property of Tenant or any other occupant of the Demised
Premises, or for any other lawful purpose, or by any representative of the fire,
police, building, sanitation or other department of the City, State or Federal
Governments. Neither anything contained in this Section, nor any action taken by
Owner under this Section, shall be deemed to constitute recognition by Owner
that any person other than Tenant has any right or interest in this Lease or the
Demised Premises.
Section 13.04. No Actual or Constructive Eviction: The exercise by
----------------------------------
Owner or its agents or by the lessor under any Superior Lease or by the holder
of any Mortgage of any right reserved to Owner in this Article shall not
constitute an actual or constructive eviction, in whole or in part, or entitle
Tenant to any abatement or diminution of rent, or relieve Tenant from any of its
obligations under this Lease, or impose any liability upon Owner, or its agents,
23
or upon any lessor under any Superior Lease or upon the holder of any Mortgage,
by reason of inconvenience or annoyance to Tenant, or injury to or interruption
of Tenant's business, or otherwise.
Section 13.05. Supplementing the provisions of Sections 13.01, 13.02
and 13.03, Owner agrees that except in cases of emergency, any entry upon the
Demised Premises pursuant to the provisions of said Sections shall be made at
reasonable times, and only after reasonable advance notice (which may be mailed,
delivered or left at the Demised Premises, notwithstanding any contrary
provisions of Article 27), and any work performed or installation made pursuant
to said Section shall be made with reasonable diligence and any such entry, work
or installations shall be made in a manner designed to minimize interference
with Tenant's normal business operations (however, nothing contained in this
Section shall be deemed to impose upon Owner any obligation to employ
contractors or labor at so-called overtime or other premium pay rates).
Section 13.06. Further supplementing the provisions of Sections 13.01
and 13.03, Owner's right to exhibit the Demised Premises to others shall be
limited to insurance carriers and representatives thereof, prospective
purchasers of the Real Property or the Building, holders or prospective holders
of any mortgage affecting the Real Property or the Building or any ground or
underlying lease, and other legitimate business visitors, and, during the last
eighteen (18) months of the Demised Term, any prospective tenant of the Demised
Premises.
Section 13.07. Further supplementing the provisions of Section 13.01,
Owner agrees that any pipes, ducts or conduits installed in or through the
Demised Premises during the Demised Term pursuant to the provisions of Section
13.01, shall either be concealed behind, beneath or within partitioning,
columns, ceilings or floors, or completely furred at points immediately adjacent
to partitioning, columns or ceilings, and that when the installation of such
pipes, ducts or conduits shall be completed, such pipes, ducts or conduits shall
not materially reduce the usable area of the Demised Premises.
Section 13.08. Further supplementing the provisions of Section 13.01,
in the event that, at any time during the Demised Term, if Tenant shall give a
notice to Owner designating an area or areas used by Tenant for the storage of
monies, securities and other valuable documents or proprietary materials, as the
"Security Area", then thereafter, except in cases of emergency only, Owner and
-------------
its agents shall have no right to enter the Security Area.
ARTICLE 14
VAULT SPACE
-----------
Section 14.01. The Demised Premises do not contain any vaults, vault
space or other space outside the boundaries of the Real Property,
notwithstanding anything contained in this Lease or indicated on any sketch,
blueprint or plan. Owner 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, and if any such
license shall be revoked, or if the amount of such space shall be diminished or
required by any Federal, State or Municipal Authority or by any public utility
company, such revocation, diminution or requisition shall not constitute an
actual or constructive eviction, in whole or in part, or entitle Tenant to any
abatement or diminution of rent, or relieve Tenant from any of its obligations
under this Lease, or impose any liability upon Owner. Any fee, tax or charge
imposed by any governmental authority for any such vault, vault space or other
space shall be paid by Tenant.
24
ARTICLE 15
CERTIFICATE OF OCCUPANCY
------------------------
Section 15.01. Tenant will not at any time use or occupy, or permit
the use or occupancy of, the Demised Premises in violation of any Certificate(s)
of Occupancy covering the Demised Premises. Owner agrees that a temporary or
permanent Certificate(s) of Occupancy covering the Demised Premises will be in
force on the Commencement Date permitting the Demised Premises to be used as
"offices". However, neither such agreement, nor any other provision of this
Lease, nor any act or omission of Owner, its agents or contractors, shall be
deemed to constitute a representation or warranty that the Demised Premises, or
any part thereof, may be lawfully used or occupied for any particular purpose or
in any particular manner, in contradistinction to mere "office" use.
ARTICLE 16
DEFAULT
-------
Section 16.01. Events of Default: Upon the occurrence, at any time
-----------------
prior to or during the Demised Term, of any one or more of the following events
(referred to herein, singly, as an "Event of Default" and collectively as
----------------
"Events of Default"):
------------------
(a) if Tenant shall default in the payment when due of any
installment of Fixed Rent or any increase in the Fixed Rent or in the
payment when due of any additional rent and such default shall
continue for a period of five (5) days after notice by Owner to Tenant
of such default; or
(b) if Tenant shall default in the observance or
performance of any term, covenant or condition of this Lease on
Tenant's part to be observed or performed (other than the covenants
for the payment of Fixed Rent, any increase in the Fixed Rent and
additional rent) and Tenant shall fail to remedy such default within
thirty (30) days after notice by Owner to Tenant of such default, or
if such default is of such a nature that it cannot be completely
remedied within said period of thirty (30) days and Tenant shall not
commence, promptly after receipt of such notice, or shall not
thereafter diligently prosecute to completion, all steps necessary to
remedy such default; or
(c) if Tenant shall file a voluntary petition in
bankruptcy or insolvency, or shall be adjudicated a bankrupt or
insolvent, or shall file any petition or answer seeking any
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, or shall make an assignment for the
benefit of creditors, or shall seek or consent to or acquiesce in the
appointment of any trustee, receiver or liquidator of Tenant or of all
or any part of Tenant's property; or
(d) if, within sixty (60) days after the commencement of
any proceeding against Tenant, whether by the filing of a petition or
otherwise, seeking any 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 sixty (60)
days after the appointment of any trustee, receiver or liquidator of
Tenant, or of 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 execution or
attachment shall be issued against Tenant or any of Tenant's property
pursuant to which the Demised Premises shall be taken or occupied or
attempted to be taken or occupied; or
25
(e) if Tenant shall default 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 Owner of space in the
Building and such default shall continue beyond any grace period set
forth in such other lease for the remedying of such default; or
(f) if the Demised Premises shall become deserted or
abandoned; or
(g) if (i) Tenant's interest in this Lease shall devolve
upon or pass to any person, whether by operation of law or otherwise,
or (ii) there shall be any sale, pledge, transfer or other alienation
described in Section 11.01 of this Lease which is deemed an assignment
of this Lease for purposes of said Section 11.01, except as expressly
permitted under Article 11;
then, during such time as such Event(s) of Default is/are continuing, Owner may
at any time, at Owner's option, give to Tenant a five (5) days' notice of
termination of this Lease and, in the event such notice is given, this Lease and
the Demised Term shall come to an end and expire (whether or not said term shall
have commenced) upon the expiration of said five (5) days with the same effect
as if the date of expiration of said five (5) days were the Expiration Date, but
Tenant shall remain liable for damages and all other sums payable pursuant to
the provisions of Article 18.
Section 16.02. "Tenant"/Moneys Received: If, at any time (i) Tenant
------------------------
shall be comprised of two (2) or more persons, or (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 Subsections (c) and (d) of Section 16.01, 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 Owner from or on
behalf of Tenant during the pendency of any proceeding of the types referred to
in said Subsections (c) and (d) shall be deemed paid as compensation for the use
and occupation of the Demised Premises and the acceptance of any such
compensation by Owner shall not be deemed an acceptance of rent or a waiver on
the part of Owner of any rights under Section 16.01.
ARTICLE 17
REMEDIES
--------
Section 17.01. Owner's Right of Re-Entry and Right to Relet: If
--------------------------------------------
Tenant shall default in the payment when due of any installment of Fixed Rent or
in the payment when due of any increase in the Fixed Rent or any additional
rent, or if this Lease and the Demised Term shall expire and come to an end as
provided in Article 16:
(a) Owner and its agents and servants may immediately, or
at any time after such default or after the date upon which this Lease
and the Demised Term shall expire and come to an end, re-enter the
Demised Premises or any part thereof, without notice, either by
summary proceedings or by any other applicable action or proceeding,
or by force or otherwise (without being liable to indictment,
prosecution or damages therefor), and may repossess the Demised
Premises and dispossess Tenant and any other persons from the Demised
Premises and remove any and all of their property and effects from the
Demised Premises; and
(b) Owner, at Owner's option, may relet the whole or any
part or parts of the Demised Premises, from time to time, either in
the name of Owner or otherwise, to such tenant or tenants, for such
term or terms ending before, on or after the Expiration Date, at such
rental or rentals and upon such other conditions, which may include
concessions and free rent periods, as Owner, in its sole discretion,
may determine. Owner shall have no obligation to relet the Demised
Premises or any part thereof and shall in no event be liable for
refusal or failure to relet the Demised Premises or any part thereof,
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 operate to relieve Tenant of any liability under this
Lease or otherwise to affect any such liability; Owner, at Owner's
option, may make such repairs,
26
replacements, alterations, additions, improvements, decorations and
other physical changes in and to the Demised Premises as Owner, in its
sole discretion, considers advisable or necessary in connection with
any such reletting or proposed reletting, without relieving Tenant of
any liability under this Lease or otherwise affecting any such
liability.
Section 17.02. Waiver of Right to Redeem, etc.: Tenant hereby waives
-------------------------------
the service of any notice of intention to re-enter or to institute legal
proceedings to that end which may otherwise be required to be given under any
present or future law. Tenant, on its own behalf and on behalf of all persons
claiming through or under Tenant, including all creditors, does further hereby
waive any and all rights which Tenant and all such persons might otherwise have
under any present or future law to redeem the Demised Premises, or to re-enter
or repossess the Demised Premises, or to restore the operation of this Lease,
after (i) Tenant shall have been dispossessed by a judgment or by warrant of any
court or judge, or (ii) any re-entry by Owner, or (iii) any expiration or
termination of this Lease and the Demised Term, whether such dispossess, 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. In the event of a breach or threatened breach by Tenant, or any
persons claiming through or under Tenant, of any term, covenant or condition of
this Lease on Tenant's part to be observed or performed, Owner shall have the
right to enjoin such breach and the right 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 right to invoke the
remedies hereinbefore set forth in this Lease is cumulative and shall not
preclude Owner from invoking any other remedy allowed by law or in equity.
Owner agrees that the first sentence of this Section 17.02 shall not be deemed a
waiver of Tenant's right to be served with any notice of petition and petition
in any summary proceedings under the provisions of the Real Property Actions and
Proceedings Law of the State of New York and any successor law of like import
then in force.
ARTICLE 18
DAMAGES
-------
Section 18.01. Amount of Owner's Damages: If this Lease and the
-------------------------
Demised Term shall expire and come to an end as provided in Article 16, or by
or under any summary proceeding or any other action or proceeding, or if Owner
shall re-enter the Demised Premises as provided in Article 17, or by or under
any summary proceeding or any other action or proceeding, then, in any of said
events:
(a) Tenant shall pay to Owner all Fixed Rent, additional
rent and other charges payable under this Lease by Tenant to Owner to
the date upon which this Lease and the Demised Term shall have expired
and come to an end or to the date of re-entry upon the Demised
Premises by Owner, as the case may be; and
(b) Tenant shall also be liable for and shall pay to Owner,
as damages, any deficiency (referred to as a "Deficiency") between the
----------
Fixed Rent reserved in this Lease for the period which otherwise would
have constituted the unexpired portion of the Demised Term and the net
amount, if any, of rents collected under any reletting effected
pursuant to the provisions of Section 17.01 for any part of such
period (first deducting from the rents collected under any such
reletting all of Owner's expenses in connection with the termination
of this Lease or Owner's re-entry upon the Demised Premises and with
such reletting including, but not limited to, all repossession costs,
brokerage commissions, legal expenses, attorneys' fees, alteration
costs and other expenses of preparing the Demised Premises for such
reletting). Any such Deficiency shall be paid in monthly installments
by Tenant on the days specified in this Lease for payment of
installments of Fixed Rent, Owner shall be entitled to recover from
Tenant each monthly Deficiency as the same shall arise, and no suit to
collect the amount of the Deficiency for any month shall prejudice
Owner's right to collect the Deficiency for any subsequent month by a
similar proceeding. Solely for the purposes of this Subsection (b),
the
27
term "Fixed Rent" shall mean the Fixed Rent in effect immediately
prior to the date upon which this Lease and the Demised Term shall
have expired and come to an end, or the date of re-entry upon the
Demised Premises by Owner, as the case may be, adjusted, from time to
time, to reflect any increases which would have been payable pursuant
to any of the provisions of this Lease including, but not limited to,
the provisions of Article 23 of this Lease if the term hereof had not
been terminated; and
(c) At any time after the Demised Term shall have expired
and come to an end or Owner shall have re-entered upon the Demised
Premises, as the case may be, as a result of any Event of Default as
set forth in subsection (c) or (d) of Section 16.01 whether or not
Owner shall have collected any monthly Deficiencies as aforesaid,
Owner shall be entitled to recover from Tenant, and Tenant shall pay
to Owner, on demand, as and for liquidated and agreed final damages, a
sum equal to the amount by which the Fixed Rent reserved in this Lease
for the period which otherwise would have constituted the unexpired
portion of the Demised Term exceeds the then fair and reasonable
rental value of the Demised Premises for the same period, both
discounted to present worth at the rate of eight (8%) percent per
annum less the aggregate amount of Deficiencies theretofore collected
by Owner pursuant to the provisions of subsection (b) of this Section
for the same period. If, before presentation of proof of such
liquidated damages to any court, commission or tribunal, the Demised
Premises, or any part thereof, shall have been relet by Owner for the
period which otherwise would have constituted the unexpired portion of
the Demised 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 Demised
Premises so relet during the term of the reletting. Solely for the
purposes of this Subsection (c), the term "Fixed Rent" shall mean the
Fixed Rent in effect immediately prior to the date upon which this
Lease and the Demised Term shall have expired and come to an end, or
the date of re-entry upon the Demised Premises by Owner, as the case
may be, adjusted to reflect any increases pursuant to the provisions
of Article 23 for the Escalation Year and Tax Escalation Year
immediately preceding such event.
Section 18.02. Rents Under Reletting: If the Demised 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 Article
18. Tenant shall in no event be entitled to any rents collected or payable
under any reletting, whether or not such rents shall exceed the Fixed Rent
reserved in this Lease. Nothing contained in Articles 16, 17 or this Article
shall be deemed to limit or preclude the recovery by Owner from Tenant of the
maximum amount allowed to be obtained as damages by any statute or rule of law,
or of any sums or damages to which Owner may be entitled in addition to the
damages set forth in Section 18.01.
ARTICLE 19
FEES AND EXPENSES; INDEMNITY
----------------------------
Section 19.01. Owner's Right to Cure Tenant's Default: If Tenant
--------------------------------------
shall default in the observance or performance of any term, covenant or
condition of this Lease on Tenant's part to be observed or performed, Owner, at
any time thereafter and without notice in cases of emergency, and in other cases
after the expiration of the applicable grace period set forth in this Lease, may
remedy such default for Tenant's account and at Tenant's expense, without
thereby waiving any other rights or remedies of Owner with respect to such
default.
Section 19.02. Tenant's Indemnity and Liability Insurance
------------------------------------------
Obligations: A. Tenant agrees to indemnify and save Owner and "Owner's
Indemnitees" (as hereinafter defined) harmless of and from all loss, cost,
liability, damage and expense including, but not limited to, reasonable counsel
fees, penalties and fines, incurred in connection with or arising from (i) any
default by Tenant in the observance or performance of any of the terms,
covenants or conditions of this Lease on Tenant's part to be observed or
performed after notice and the expiration of any applicable grace or cure period
in this Lease specifically with respect thereto, or (ii) the breach or failure
of any representation or warranty made by Tenant in this Lease, or (iii) the
manner of use or occupancy of the Demised
28
Premises by Tenant or any person claiming through or under Tenant (in
contradistinction to the mere use or occupancy of the Demised Premises for the
purposes set forth in Section 2.01), or (iv) any acts, omissions or negligence
of Tenant or any such person, or the contractors, agents, servants, employees,
visitors or licensees of Tenant or any such person, in or about the Demised
Premises or the Building either prior to, during, or after the expiration of,
the Demised Term, including, but not limited to, any acts omissions or
negligence in the making or performing of any Alterations. Tenant further agrees
to indemnify and save harmless Owner and Owner's Indemnitees of and from all
loss, cost, liability, damage and expense, including, but not limited to,
reasonable counsel fees and disbursements incurred in connection with or arising
from any claims by any persons by reason of injury to persons or damage to
property occasioned by any use, occupancy, act, omission or negligence referred
to in the preceding sentence. "Owner's Indemnitees" shall mean the Owner, the
-------------------
shareholders or the partners comprising Owner and its and their partners and
shareholders, officers, directors, employees, agents (including without
limitation, any leasing and managing agents) and contractors together with the
lessor under any Superior Lease and the holder of any Mortgage. If any action or
proceeding shall be brought against Owner or Owner's Indemnitees based upon any
such claim and if Tenant, upon notice from Owner, shall cause such action or
proceeding to be defended at Tenant's expense by counsel acting for Tenant's
insurance carriers in connection with such defense or by other counsel
reasonably satisfactory to Owner, without any disclaimer of liability by Tenant
or such insurance carriers in connection with such claim, Tenant shall not be
required to indemnify Owner and Owner's Indemnitees for counsel fees in
connection with such action or proceeding.
B. Throughout the Demised Term Tenant shall maintain
comprehensive public liability and water legal liability insurance against any
claims by reason of personal injury, death and property damage occurring in or
about the Demised Premises covering, without limitation, the operation of any
private air conditioning equipment and any private elevators, escalators or
conveyors in or serving the Demised Premises or any part thereof, whether
installed by Owner, Tenant or others, and shall furnish to Owner duplicate
original policies of such insurance at least ten (10) days prior to the
Commencement Date and at least ten (10) days prior to the expiration of the term
of any such policy previously furnished by Tenant, in which policies Owner, and
Owner's Indemnitees shall be named as parties insured, which policies shall be
issued by companies, and shall be in form and amounts, reasonably satisfactory
to Owner.
Section 19.03. Payments: Tenant shall pay to Owner, within five (5)
--------
days next following rendition by Owner to Tenant of bills or statements
therefor: (i) sums equal to all expenditures made and monetary obligations
incurred by Owner including, but not limited to, expenditures made and
obligations incurred for reasonable counsel fees and disbursements, in
connection with the remedying by Owner, for Tenant's account pursuant to the
provisions of Section 19.01, of any default of Tenant, and (ii) sums equal to
all losses, costs, liabilities, damages and expenses referred to in Section
19.02, and (iii) sums equal to all expenditures made and monetary obligations
incurred by Owner including, but not limited to, expenditures made and
obligations incurred for reasonable counsel fees and disbursements, in
collecting or attempting to collect the Fixed Rent, any additional rent or any
other sum of money accruing under this Lease or in enforcing or attempting to
enforce any rights of Owner under this Lease or pursuant to law, whether by the
institution and prosecution of summary proceedings or otherwise; and (iv) all
other sums of money (other than Fixed Rent) accruing from Tenant to Owner under
the provisions of this Lease. Any sum of money (other than Fixed Rent) accruing
from Tenant to Owner pursuant to any provision of this Lease whether prior to or
after the Commencement Date, may, at Owner's option, be deemed additional rent,
and Owner shall have the same remedies for Tenant's failure to pay any item of
additional rent when due as for Tenant's failure to pay any installment of Fixed
Rent when due. Tenant's obligations under this Article shall survive the
expiration or sooner termination of the Demised Term.
Section 19.04. Tenant's Late Payments - Late Charges: If Tenant
-------------------------------------
shall fail to make payment of any installment of Fixed Rent or any increase in
the Fixed Rent or any additional rent within ten (10) days after the date when
such payment is due, Tenant shall pay to Owner, in addition to such installment
of Fixed Rent or such increase in the Fixed Rent or such additional rent, as the
case may be, as a late charge and as additional rent, a sum equal to three (3%)
percent per annum above the then current prime rate (as the term "prime rate" is
defined in Section 31.03) charged by Chemical Bank or its successor of the
amount unpaid computed from the date such payment was due to and including the
date of payment.
29
Section 19.05. Owner agrees to indemnify and save Tenant harmless of
and from all loss, cost, liability, damage and expense, including, but not
limited to, reasonable counsel fees, penalties and fines incurred in connection
with or arising from (i) any default by Owner in the performance or observance
of any of the terms, covenants or conditions of this Lease on Owner's part to be
observed or performed, or (ii) any acts, omissions or negligence of Owner or its
employees, agents, contractors or servants in or about the Demised Premises or
the Building either prior to, during, or after, the expiration of the Demised
Term. Owner further agrees to indemnify and save harmless Tenant and its agents
of and from all loss, cost, liability, damage, and expense, including, but not
limited to, reasonable counsel fees incurred in connection with or arising from
any claims by any persons or damage to property occasioned by any act, omission
or negligence referred to in the preceding sentence. If any action or
proceeding shall be brought against Tenant or Tenant's agents based upon any
such claim and if Owner, upon notice from Tenant, shall cause such action or
proceeding to be defended at Owner's expense by counsel acting for Owner's
insurance carriers in connection with such defense or by other counsel
reasonably satisfactory to Tenant, without any disclaimer of liability by Owner
in connection with such claim, Owner shall not be required to indemnify Tenant
or Tenant's agents for counsel fees in connection with such action or
proceeding.
ARTICLE 20
ENTIRE AGREEMENT
----------------
Section 20.01. Entire Agreement: This Lease contains the entire
----------------
agreement between the parties and all prior negotiations and agreements are
merged in this Lease. Neither Owner nor Owner's agents have made any
representations or warranties with respect to the Demised Premises, the
Building, the Real Property or this Lease except as expressly set forth in this
Lease and no rights, easements or licenses are or shall be acquired by Tenant by
implication or otherwise unless expressly set forth in this Lease. This Lease
may not be changed, modified or discharged, in whole or in part, orally and no
executory agreement shall be effective to change, modify or discharge, in whole
or in part, this Lease or any provisions of this Lease, unless such agreement is
set forth in a written instrument executed by the party against whom enforcement
of the change, modification or discharge is sought. All references in this
Lease to the consent or approval of Owner shall be deemed to mean the written
consent of Owner, or the written approval of Owner, as the case may be, and no
consent or approval of Owner shall be effective for any purpose unless such
consent or approval is set forth in a written instrument executed by Owner.
30
ARTICLE 21
END OF TERM
-----------
Section 21.01. End of Term: On the date upon which the Demised Term
-----------
shall expire and come to an end, whether pursuant to any of the provisions of
this Lease or by operation of law, and whether on or prior to the Expiration
Date, Tenant, at Tenant's sole cost and expense, (i) shall quit and surrender
the Demised Premises to Owner, broom clean and in good order and condition,
ordinary wear and tear and damage or destruction by fire or any other casualty
and repairs for which Tenant is not responsible under the provisions of this
Lease excepted, and (ii) shall remove all of Tenant's Personal Property and all
other property and effects of Tenant and all persons claiming through or under
Tenant (including, but not limited to, all telecommunications facilities) from
the Demised Premises and the Building, and (iii) shall repair all damage to the
Demised Premises and the Building occasioned by such removal and (iv) shall, at
Owner's election, exercisable within six (6) months following the expiration or
earlier termination of the Demised Term, remove any private interior staircases
in the Demised Premises or connecting the Demised Premises or any part thereof
with any other space (referred to herein as the "Other Space") in the Building
-----------
occupied by Tenant, and restore those portions of the Demised Premises, the
Other Space and the Building affected by any such staircases (including, but not
limited to, the slabbing over of any openings) to the condition of each which
existed prior to the installation of any such staircases, and repair any damage
to the Demised Premises, Other Space and the Building occasioned by such
removal. Notwithstanding the provisions of subdivision (iv) of the foregoing
sentence, in the event Owner does not elect to have removed any such staircase
referred to therein, any such staircase shall be and remain the property of
Owner at no cost or expense to Owner. Owner shall have the right to retain any
property and effects which shall remain in the Demised Premises after the
expiration or sooner termination of the Demised Term, and any net proceeds from
the sale thereof, without waiving Owner's rights with respect to any default by
Tenant under the foregoing provisions of this Section. 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 Owner
may institute to enforce the foregoing provisions of this Article. If said date
upon which the Demised Term shall expire and come to an end shall fall on a
Sunday or holiday, then Tenant's obligations under the first sentence of this
Section shall be performed on or prior to the Saturday or business day
immediately preceding such Sunday or holiday. Tenant's obligations under this
Section shall survive the expiration or sooner termination of the Demised Term.
ARTICLE 22
QUIET ENJOYMENT
---------------
Section 22.01. Quiet Enjoyment: Owner covenants and agrees with
---------------
Tenant that upon Tenant paying the Fixed Rent and additional rent reserved in
this Lease and observing and performing all of the terms, covenants and
conditions of this Lease on Tenant's part to be observed and performed, Tenant
may peaceably and quietly enjoy the Demised Premises during the Demised Term,
subject, however, to the terms, covenants and conditions of this Lease
including, but not limited to, the provisions of Section 37.01, and subject to
the Superior Lease and the Mortgage referred to in Section 7.01.
ARTICLE 23
TAX PAYMENTS AND OPERATING ESCALATION
-------------------------------------
Section 23.01. Definitions: In the determination of any increase in
-----------
the Fixed Rent under the provisions of this Article, Owner and Tenant agree that
the following terms shall have the following meanings:
31
A. The term "Tax Escalation Year" shall mean each fiscal
-------------------
year commencing July 1st and ending on the following June 30th which shall
include any part of the Demised Term.
B. The term "Escalation Year" shall mean each calendar year
---------------
which shall include any part of the Demised Term.
C. The term "Taxes" shall be deemed to mean a sum equal to
-----
the aggregate of: (i) the product determined by multiplying (a) the then
applicable full New York City real estate tax rate in effect with respect to the
Borough of Manhattan by (b) the then applicable assessed valuation of the Real
Property plus (ii) amounts assessed by any business improvement district in
which the Real Property is located plus (iii) any other assessments, special or
otherwise, upon or with respect to the Real Property imposed by the City or
County of New York or any other taxing authority. If, due to any change in the
method of taxation, any franchise, income, profit, sales, rental, use and
occupancy or other tax or payments in lieu of any such taxes shall be
substituted for, or levied against Owner or any owner of the Building or the
Real Property, in lieu of any real estate taxes or assessments upon or with
respect to the Real Property, such tax or payments in lieu of any such taxes
shall be included in the term Taxes for the purposes of this Article. Subject to
the foregoing provisions hereof, "Taxes" shall not include (i) any income,
capital levy, franchise, capital stock, gift, estate or inheritance tax and
(iii) interest or penalties incurred by Owner as a result of Owner's late
payment of Taxes.
D. The term "Demised Premises Area" shall mean 3,324 square
---------------------
feet.
E. The term "Building Area" shall mean 398,537 square feet.
-------------
F. The term "Tenant's Proportionate Share" shall mean the
----------------------------
fraction, the denominator of which is the Building Area and the numerator of
which is the Demised Premises Area.
G. (1) The term "Operating Expenses" shall, subject to the
------------------
provisions of Paragraph (2) of this Subsection 23.01.G, mean the aggregate cost
and expense incurred by Owner in the operation, maintenance, management and
security of the Real Property and any plazas, sidewalks and curbs adjacent
thereto including, without limitation, the cost and expense of the following:
(a) salaries, wages, medical, surgical and general welfare
and other so-called "fringe" benefits (including group insurance
and retirement benefits) for employees (including, but not
limited to, employees who provide twenty four (24) hour services,
seven (7) days per week throughout the year) of Owner or any
contractor of Owner engaged in the cleaning, operation,
maintenance or management of the Real Property, or engaged for
security purposes and/or for receiving or transmitting deliveries
to and from the Building, and payroll taxes and workmen's
compensation insurance premiums relating thereto,
(b) gas, steam, water and sewer rental,
(c) thirty five (35%) percent of all electrical costs
incurred in the operation of the Building, provided, however, in
the event that Owner discontinues the redistribution or
furnishing of electrical energy to the tenants and occupants of
the Building, then the cost and expense incurred by Owner for
electricity shall thereafter be deemed to be one hundred (100%)
percent of (i) the total cost and expense to Owner of purchasing
electricity for the Building less (ii) any reimbursement to Owner
by the tenants in the Building for the payment for the Floor HVAC
Units and the Floor Public Light and Power (as said terms are
defined in Section 29.05).
(d) utility taxes,
32
(e) rubbish removal,
(f) fire, casualty, liability, rent and other insurance
carried by Owner,
(g) repairs, repainting, replacement, maintenance of
grounds, and Included Improvements (as provided in Paragraph (2)
of this Subsection 23.01.G),
(h) Building supplies,
(i) uniforms and cleaning thereof,
(j) snow removal,
(k) window cleaning,
(l) service contracts with independent contractors for any
of the foregoing (including, but not limited to, elevator,
heating, air conditioning, ventilating, sprinkler system, fire
alarm and telecommunication equipment maintenance),
(m) management fees (whether or not paid to any person,
firm or corporation having an interest in or under common
ownership with Owner or any of the persons, firms or corporations
comprising Owner) in the amount of one ($1.00) dollar per
rentable square foot of the Building Area in the first Escalation
Year which amount for management fees shall increase in each
Escalation Year subsequent to the first Escalation Year by the
same percentage of increase as the percentage of increase in the
aggregate of all other Operating Expenses,
(n) legal fees and disbursements and other expenses
(excluding, however, legal fees and expenses incurred in
connection with any (i) application or proceeding brought for
reduction of the assessed valuation of the Real Property or any
part thereof, or (ii) the negotiation of leases or any
proceedings brought for collection of rent or additional rents),
(o) auditing fees,
(p) deleted,
(q) all costs of compliance under the provisions of any
present or future Superior Lease other than the payment of rental
and impositions thereunder and increases in the basic rent under
such leases as a result of adjustments in such basic rent, and
(r) all other costs and expenses incurred in connection
with the operation, maintenance, management and security of the
Real Property, and any plazas, sidewalks and curbs adjacent
thereto.
(2) The cost and expense of the following shall be excluded from
the calculation of operating expenses:
(a) leasing commissions;
(b) executives' salaries above the grade of building
manager and superintendent;
33
(c) capital improvements and replacements which under
generally accepted accounting principles and practice would be
classified as capital expenditures, except the cost and expense
of any improvement, alteration, replacement or installation which
is either (i) required by any Legal Requirement, or (ii)
designed, in Owner's judgment, to result in savings or reductions
in Operating Expenses or (iii) designed, in Owner's judgment, to
benefit the tenants of the Building (such improvements,
alterations, replacements and installations are referred to as
"Included Improvements"); the cost and expense of Included
---------------------
Improvements whenever made shall be included in Operating
Expenses for any Escalation Year subsequent to the Base
Escalation Year to the extent of (x) the annual amortization or
depreciation of the cost and expense to Owner of such Included
Improvements, as amortized or depreciated on a straight line
basis over ten (10) years allocable to such Escalation Year plus
(y) an annual charge for interest upon the unamortized or
undepreciated portions of such cost and expense at the average
prime rate (as defined in Section 31.03) during the Escalation
Year in question;
(d) any other item which under generally accepted
accounting principles and practice would not be regarded as an
operating, maintenance or management expense;
(e) any item for which Owner is compensated through
proceeds of insurance;
(f) any specific compensation which Owner receives from
any tenant for services rendered to such tenant by Owner above
and beyond those services generally rendered by Owner to tenants
in the Building without specific compensation therefor;
(g) sixty-five (65%) percent of all electrical costs
incurred in the operation of the Building, provided however, in
the event that Owner discontinues the redistribution or
furnishing of electrical energy to the tenants and occupants of
the Building, then the aforesaid exclusion of sixty-five (65%)
percent of such electrical costs shall not apply;
(h) interest and principal payments for mortgages;
(i) any ground or underlying lease rental;
(j) bad debt expenses, and interest, principal, points and fees
on debts or amortization on any mortgage or other debt instrument
encumbering the Building or the Real Property;
(k) cost incurred by Owner to the extent that Owner is
reimbursed by insurance proceeds or is otherwise reimbursed;
(l) advertising and promotional expenditures, and costs or
acquisition and maintenance of signs in or on the Building
identifying the Owner of the Building or other tenants;
(m) marketing costs, including leasing commissions, attorneys'
fees (in connection with the negotiation and preparation of
letters, deal memos, letters of intent, leases, subleases and /or
assignments), space planning costs, and other costs and expenses
incurred in connection with lease, sublease and/or assignment
negotiations and transactions with present or prospective tenants
or other occupants of the Building;
(n) costs, including permit, license and inspection costs,
incurred with respect to the installation of tenants' or other
occupants' improvements or incurred in renovating or otherwise
improving, decorating, painting or redecorating vacant space for
tenants or other occupants of the Building;
34
(o) expenses in connection with services or other benefits which
are not offered to Tenant or for which Tenant is charged for
directly;
(p) Costs incurred by Owner due to the violation by Owner or any
tenant of the terms and conditions of any lease of space in the
Building;
(q) amounts paid to Owner or to subsidiaries or affiliates of
Owner for goods and/or services in the Building to the extent the
same exceeds the costs of such goods and/or services rendered by
unaffiliated third parties on a competitive basis;
(r) any compensation paid to clerks, attendants or other persons
in commercial concessions operated by Owner;
(s) services provided, taxes, attributable to, and costs
incurred in connection with the operation of any retail,
restaurant and garage operations for the Building, and any
replacement garages or parking facilities and any shuttle
services;
(t) costs arising from the negligence or willful misconduct of
Owner or other tenants or occupants of the Building or their
respective agents, employees, licensees, vendors, contractors or
providers of materials or services;
(u) costs arising from Owner's charitable or political
contributions;
(v) costs for sculpture, paintings or other objects of art;
(w) costs incurred in connection with the original construction
of the Building or in connection with any major change in the
Building, such as adding or deleting floors which under generally
accepted accounting principles consistently applied, are properly
classified as capital expenditure;
(x) costs associated with the operation of the business of the
partnership or entity which constitutes the Owner, as the same
are distinguished from the costs of operation of the Building,
including partnership accounting and legal matters, costs of
defending any lawsuits with any mortgagee (except as the actions
of Tenant may be in issue), costs of selling, syndicating,
financing, mortgaging or hypothecating any of Owner's interest in
the Building, costs (including attorney's fees and costs of
settlement judgments and payments in lieu thereof) arising from
the claims, disputes or potential disputes in connection with
potential or actual claims, litigation or arbitrations pertaining
to Owner and/or the Building and/or the site upon which the
Building is situated;
(y) the wages and benefits of any executive or administrative
employee above building manager or supervisor or any non-
executive employee to the extent it does not devote substantially
all of his or her time to the Building; and
(z) Owner's general corporate overhead and general and
administrative expenses;
H. The term "Base Operating Expenses" shall mean the sum
-----------------------
equal to Operating Expenses in effect for the calendar year 2000 (which is
referred to herein as the "Base Escalation Year").
--------------------
I. The term "Owner's Tax Statement" shall mean an
---------------------
instrument containing a computation of any increase in the Fixed Rent pursuant
to the provisions of Section 23.02 A. of this Article.
35
J. The term "Owner's Operating Expense Statement" shall
-----------------------------------
mean an instrument containing a computation of any increase in the Fixed Rent
pursuant to the provisions of Section 23.04 of this Article.
K. The term "Monthly Escalation Installment" shall mean a
------------------------------
sum equal to one-twelfth (1/12th) of the increase in the Fixed Rent payable
pursuant to the provisions of Subsection 23.04 A for the Escalation Year with
respect to which Owner has most recently rendered an Owner's Operating Expense
Statement, appropriately adjusted to reflect (i) in the event such Escalation
Year is a partial calendar year, the increase in the Fixed Rent which would have
been payable for such Escalation Year if it had been a full calendar year, and
(ii) the amount by which current Operating Expenses as reasonably estimated by
Owner exceed Operating Expenses as reflected in such Owner's Operating Expense
Statement; and (iii) any net credit balance to which Tenant may be entitled
pursuant to the provisions of Subsection 23.05 C.
L. The term "Monthly Escalation Installment Notice" shall
-------------------------------------
mean a notice given by Owner to Tenant which sets forth the current Monthly
Escalation Installment; such Notice may be contained in a regular monthly rent
xxxx, in an Owner's Operating Expense Statement, or otherwise, and may be given
from time to time, at Owner's election.
M. Owner and Tenant acknowledge that Owner may apply for a
certificate of eligibility from the Department of Finance of the City of New
York determining that Owner is eligible to apply for exemption from tax payments
for the Real Property pursuant to the provisions of Section 11-256 through 11-
267 (the "ICIP Program") of the Administrative Code of the City of New York and
------------
the regulations promulgated pursuant to the ICIP Program. Any such tax exemption
for the Real Property is referred to as "Tax Exemption" and the period of such
-------------
Tax Exemption is referred to as the "Tax Exemption Period". Owner agrees that
--------------------
Tenant shall not be required to (a) pay Taxes or charges which become due
because of the willful neglect or fraud by Owner in connection with the ICIP
Program or (b) otherwise relieve or indemnify Owner from any personal liability
arising under the ICIP Program, except where imposition of such Taxes, charges
or liability is occasioned by actions of Tenant in violation of this Lease.
Tenant agrees to report to Owner, as often as is necessary under such
regulations, the number of workers engaged in employment in the Demised
Premises, the nature of each worker's employment and the residency of each
worker and to provide access to the Demised Premises by employees and agents of
the Department of Finance of the City of New York at all reasonable times at the
request of Owner. Tenant represents to the Owner that, within the seven (7)
years immediately preceding the date of this Lease, Tenant has not been adjudged
by a court of competent jurisdiction to have been guilty of (x) an act, with
respect to a building, which is made a crime under the provisions of Article 150
of the Penal Law of the State of New York or any similar law of another state,
or (y) any act made a crime or violation by the provisions of Section 235 of the
Real Property Law of the State of New York, nor is any charge for a violation of
such laws presently pending against Tenant. Upon request of Owner, from time to
time, Tenant agrees to update said representation when required because of the
ICIP Program and regulations thereunder. Tenant further agrees to cooperate with
Owner in compliance with such ICIP Program and regulations to aid Owner in
obtaining and maintaining the Tax Exemption and, if requested by Owner, to post
a notice in a conspicuous place in the Demised Premises and to publish a notice
in a newspaper of general circulation in the City of New York, in such form as
shall be prescribed by the Department of Finance stating that persons having
information concerning any violation by Tenant of Section 235 of the Real
Property Law or any Section of Article 150 of the Penal Law or any similar law
of another jurisdiction may submit such information to the Department of Finance
to be considered in determining Owner's eligibility for benefits. Tenant
acknowledges that its obligations under the provisions of Subsection 23.02A may
be greater if Owner fails to obtain a Tax Exemption, and agrees that Owner shall
have no liability to Tenant nor shall Tenant be entitled to any abatement or
diminution of rent if Owner fails to obtain a Tax Exemption.
N. Owner and Tenant acknowledge that Tenant may apply for a
certificate of abatement from the Department of Finance of the City of New York
pursuant to the provisions of Title 4 of the Real Property Law of the State of
New York (the "Tax Abatement Program"). Owner agrees, at no cost or expense to
Owner, to cooperate with Tenant in its efforts to procure a certificate of
abatement including, if necessary, and if Owner
36
approves of its contents, co-signing Tenant's application for a certificate of
abatement. Pursuant to the Tax Abatement Program, Owner hereby informs Tenant
that:
"(1) an application for abatement of real property taxes
pursuant to this title will be made for the premises;
(2) the rent, including amounts payable by the tenant for
real property taxes, will accurately reflect any abatement of real property
taxes granted pursuant to this title for the premises;
(3) at least ten dollars per square foot or thirty-five
dollars per square foot must be spent on improvements to the premises and the
common areas, the amount being dependent upon the length of the lease and
whether it is a new or a renewal lease, provided, however, that with respect to
a lease commencing on or after April 1, 1997, if, by the sixtieth (60th) day
following the rent commencement date, the tenant employs one hundred twenty-five
(125) or fewer employees in the relevant premises, at least five dollars per
square foot must be spent on improvements to the premises and the common areas;
and
(4) all abatements granted with respect to a building
pursuant to this title will be revoked if, during the benefit period, real
estate taxes or water or sewer charges or other lienable charges are unpaid for
more than one year, unless such delinquent amounts are paid as provided in
subdivision four of section four hundred ninety-nine-f of this title."
Tenant agrees that Owner shall have no liability to Tenant nor shall
Tenant be entitled to any abatement or diminution of rent if Tenant fails to
obtain a certificate of abatement under the Tax Abatement Program.
Section 23.02. Taxes: A. The Fixed Rent for each Tax Escalation
-----
Year shall be increased by a sum equal to Tenant's Proportionate Share of Taxes
for such Tax Escalation Year.
B. Unless the Commencement Date shall occur on a July
1st, any increase in the Fixed Rent pursuant to the provisions of Subsection A
of this Section 23.02 for the Tax Escalation Year in which the Commencement Date
shall occur shall be apportioned in that percentage which the number of days in
the period from the Commencement Date to June 30th of such Tax Escalation Year,
both inclusive, bears to the total number of days in such Tax Escalation Year.
Unless the Demised Term shall expire on a June 30th, any increase in the Fixed
Rent pursuant to the provisions of said Subsection A for the Tax Escalation Year
in which the date of the expiration of the Demised Term shall occur shall be
apportioned in that percentage which the number of days in the period from July
1st of such Tax Escalation Year to such date of expiration, both inclusive,
bears to the total number of days in such Tax Escalation Year.
Section 23.03. Calculation and Payment of Taxes: A. Owner shall render to
--------------------------------
Tenant, either in accordance with the provisions of Article 27 or by personal
delivery at the Demised Premises, an Owner's Tax Statement or Statements with
respect to each Tax Escalation Year, either prior to or during such Tax
Escalation Year. Owner's failure to render an Owner's Tax Statement with respect
to any Tax Escalation Year shall not prejudice Owner's right to recover any sums
due to Owner hereunder with respect to such Tax Escalation Year nor shall it
deprive Tenant of any credit to which it otherwise might be entitled to for any
Tax Escalation Year pursuant to the provisions of subsection B of this Section
23.03. Tenant acknowledges that under present law, Taxes are payable by Owner
(i) with respect to a fiscal year commencing July 1st and ending on the
following June 30th, and (ii) in two (2) installments, in advance, the first of
which is payable on July 1st, and the second and final payment of which is
payable on the following January 1st. Within ten (10) days next following
rendition of the first Owner's Tax Statement which shows an increase in the
Fixed Rent for any Tax Escalation Year, Tenant shall pay to Owner one-half of
the amount of the increase shown upon such Owner's Tax Statement for such Tax
Escalation Year (including any apportionment pursuant to the provisions of
subsection B of Section 23.02); and, subsequently, provided Owner shall have
rendered to Tenant an Owner's Tax Statement, Tenant shall pay to Owner not later
than thirty (30) days prior to the date on which the installment of Taxes is
required to be paid by Owner a sum equal to one half (1/2) of Tenant's
Proportionate Share of Taxes payable with
37
respect to such Tax Escalation Year as shown on such Owner's Tax Statement.
Tenant further acknowledges that it is the purpose and intent of this Section
23.03 to provide Owner with Tenant's Proportionate Share of Taxes thirty (30)
days prior to the time such installment of Taxes is required to be paid by Owner
without penalty or interest. Accordingly, Tenant agrees if the number of such
installments and/or the date of payment thereof and/or the fiscal year used for
the purpose of Taxes shall change then (a) at the time that any such revised
installment is payable by Owner, Tenant shall pay to Owner the amount which
shall provide Owner with Tenant's Proportionate Share of Taxes applicable to the
revised installment of Taxes then required to be paid by Owner, and (b) this
Article shall be appropriately adjusted to reflect such change and the time for
payment to Owner of Tenant's Proportionate Share of Taxes as provided in this
Article shall be appropriately revised so that Owner shall always be provided
with Tenant's Proportionate Share of Taxes thirty (30) days prior to the
installment of Taxes required to be paid by Owner. Notwithstanding the foregoing
provisions of this subsection A to the contrary, in the event the holder of any
mortgage affecting the Real Property shall require Owner to make monthly
deposits on account of real estate taxes, then this Article shall be
appropriately adjusted to reflect the requirement that Owner make monthly
deposits on account of real estate taxes so that Owner shall always be provided
with one-twelfth (1/12th) of Tenant's Proportionate Share of Taxes with respect
to any Tax Escalation Year thirty (30) days prior to the payment by Owner of
such monthly deposits on account of real estate taxes.
B. If, as a result of any application or proceeding
brought by or on behalf of Owner for reduction of the assessed valuation of the
Real Property there shall be a decrease in Taxes for any Tax Escalation Year
with respect to which Owner shall have previously rendered an Owner's Tax
Statement, the next monthly installment or installments of Fixed Rent following
such decrease shall include an adjustment of the Fixed Rent for such Tax
Escalation Year reflecting a credit to Tenant equal to the amount by which (i)
the Fixed Rent actually paid by Tenant with respect to such Tax Escalation Year
(as increased pursuant to the operation of the provisions of subsection A of
Section 23.02), shall exceed (ii) the Fixed Rent payable with respect to such
Tax Escalation Year (as increased pursuant to the operation of the provisions of
subsection A of Section 23.02) based upon such reduction of the assessed
valuation. Tenant shall pay to Owner within thirty (30) days after demand, as
additional rent under this Lease, a sum equal to Tenant's Proportionate Share of
all costs and expenses, including, without limitation, counsel fees, paid or
incurred by Owner in connection with any application or proceeding brought for
reduction of the assessed valuation of the Real Property or any other contest of
Taxes upon the Real Property for any Tax Escalation Year, whether or not such
application, proceeding or other contest was commenced and/or settled and/or
determined prior to the Tax Escalation Year in question. Any outstanding credit
as of the Expiration Date as a result of the operation of the foregoing
provisions hereof shall be paid as cash to Tenant.
Section 23.04. Operating Expenses: A. If Operating Expenses in any
------------------
Escalation Year shall be in such an amount as shall constitute an increase above
Base Operating Expenses, the Fixed Rent for such Escalation Year shall be
increased by a sum equal to Tenant's Proportionate Share of any such increase.
In the event that Base Operating Expenses shall be in excess of Operating
Expenses in any Escalation Year, in no event shall Tenant be entitled to any
such excess and the Fixed Rent shall not be reduced in any way.
B. Unless the Commencement Date shall occur on a January
1st, any increase in the Fixed Rent pursuant to the provisions of Subsection A
of this Section 23.04 for the Escalation Year in which the Commencement Date
shall occur shall be apportioned in that percentage which the number of days in
the period from the Commencement Date to December 31st of such Escalation Year,
both dates inclusive, bears to the total number of days in such Escalation Year.
Unless the Demised Term shall expire on December 31st any increase in the Fixed
Rent pursuant to the provisions of Subsection A of this Section 23.04 for the
Escalation Year in which the date of the expiration of the Demised Term shall
occur shall be apportioned in that percentage which the number of days in the
period from January 1st of such Escalation Year to such date of expiration, both
dates inclusive, bears to the total number of days in such Escalation Year.
C. In the determination of any increase in the Fixed Rent
pursuant to the foregoing provisions of this Section 23.04, if the Building
shall not have been fully occupied during any Escalation Year, Operating
Expenses for such Escalation Year shall be equitably adjusted (by including such
additional expenses as Owner would have incurred) to the extent, if any,
required to reflect full occupancy.
38
Section 23.05. Calculation and Payment of Operating Expenses: A.
---------------------------------------------
Owner shall render to Tenant, either in accordance with the provisions of
Article 27 or by personal delivery at the Demised Premises, an Owner's Operating
Expense Statement with respect to each Escalation Year on or before the next
succeeding October 1st. Owner's failure to render an Owner's Operating Expense
Statement with respect to any Escalation Year shall not prejudice Owner's right
to recover any sums due to Owner hereunder with respect to such Escalation Year.
B. Within fifteen (15) days next following rendition
of the first Owner's Operating Expense Statement which shows an increase in the
Fixed Rent for any Escalation Year, Tenant shall pay to Owner the entire amount
of such increase. In order to provide for current payments on account of future
potential increases in the Fixed Rent which may be payable by Tenant pursuant to
the provisions of Subsection 23.04.A, Tenant shall also pay to Owner at such
time, provided Owner has given to Tenant a Monthly Escalation Installment
Notice, a sum equal to the product of (i) the Monthly Escalation Installment set
forth in such Notice multiplied by (ii) the number of months or partial months
which shall have elapsed between January 1st of the Escalation Year in which
such payment is made and the date of such payment, less any amounts theretofore
paid by Tenant to Owner on account of increases in the Fixed Rent for such
Escalation Year pursuant to the provisions of the penultimate sentence of this
Subsection 23.05.B; thereafter Tenant shall make payment of a Monthly Escalation
Installment throughout each month of the Demised Term. Monthly Escalation
Installments shall be added to and payable as part of each monthly installment
of Fixed Rent. Notwithstanding anything to the contrary contained in the
foregoing provisions of this Article, prior to the rendition of the first
Owner's Operating Expense Statement which shows an increase in the Fixed Rent
for any Escalation Year, Owner may render to Tenant a pro-forma Owner's
Operating Expense Statement containing a bona fide estimate of the increase in
the Fixed Rent for the Escalation Year in which the Commencement Date shall
occur and/or the subsequent Escalation Year. Following the rendition of such
pro-forma Owner's Operating Expense Statement, Tenant shall pay to Owner a sum
equal to one twelfth (1/12th) of the estimated increase in the Fixed Rent shown
thereon for such Escalation Year or Years multiplied by the number of months
which may have elapsed between the Commencement Date and the month in which such
payment is made and thereafter pay to Owner, on the first day of each month of
the Demised Term (until the rendition by Owner of the first Owner's Operating
Expense Statement) a sum equal to one twelfth (1/12th) of the increase in the
Fixed Rent shown on such pro-forma Owner's Operating Expense Statement. Any sums
paid pursuant to the provisions of the immediately preceding sentence shall be
credited against the sums required to be paid by Tenant to Owner pursuant to the
Owner's Operating Expense Statement for the first Escalation Year for which
there is an increase in the Fixed Rent pursuant to the provisions of Subsection
A.
C. Following rendition of the first Owner's
Operating Expense Statement and each subsequent Owner's Operating Expense
Statement a reconciliation shall be made as follows: Tenant shall be debited
with any increase in the Fixed Rent shown on such Owner's Operating Expense
Statement and credited with the aggregate amount, if any, paid by Tenant in
accordance with the provisions of Subsection B of this Section on account of
future increases in the Fixed Rent pursuant to Subsection 23.04 A. which has not
previously been credited against increases in the Fixed Rent shown on Owner's
Operating Expense Statements. Tenant shall pay any net debit balance to Owner
within fifteen (15) days next following rendition by Owner, either in accordance
with the provisions of Article 27 or by personal delivery at the Demised
Premises of an invoice for such net debit balance; any net credit balance shall
be applied as an adjustment against the next accruing Monthly Escalation
Installment as provided in Subsection L of Section 23.01 or paid promptly, to
Tenant, on or about the Expiration Date.
Section 23.06. Dispute Resolution: A. In the event of any dispute
------------------
between Owner and Tenant arising out of the application of the Operating Expense
provisions of this Article, such dispute shall be determined by arbitration in
New York City in accordance with the provisions of Article 36. Notwithstanding
any such dispute and submission to arbitration, or any dispute with respect to
the Tax Escalation provisions of this Article (which dispute shall not be
subject to arbitration but which can only be prosecuted by the institution of
legal proceedings by Tenant), any increase in the Fixed Rent shown upon any
Owner's Operating Expense Statement or any Monthly Escalation Installment Notice
or any Owner's Tax Statement shall be payable by Tenant within the time
limitation set forth in this Article. If the determination in such arbitration
or legal proceedings shall be adverse to Owner, any amount paid by Tenant to
Owner in excess of the amount determined to be properly payable shall be
credited against the next
39
accruing installments of Fixed Rent due under this Lease. However, if there are
no such installments, such amounts shall be paid by Owner to Tenant within ten
(10) days following such determination.
B. In the event Tenant disagrees with any computation or other
matter contained in any Owner's Operating Expense Statement or any Monthly
Escalation Installment Notice, Tenant shall have the right to give notice to
Owner within ninety (90) days next following rendition of such Statement or
Notice setting forth the particulars of such disagreement. If the matter is not
resolved within thirty (30) days next following the giving of such notice by
Tenant, it shall be deemed a dispute which either party may submit to
arbitration pursuant to the provisions of Subsection A of this Section. If (i)
Tenant does not give a timely notice to Owner in accordance with the foregoing
provisions of this Subsection disagreeing with any computation or other matter
contained in any Owner's Operating Expense Statement or any Monthly Escalation
Installment Notice and setting forth the particulars of such disagreement, or
(ii) if any such timely notice shall have been given by Tenant, the matter shall
not have been resolved and neither party shall have submitted the dispute to
arbitration within thirty (30) days next following the giving of such notice by
Tenant, Tenant shall be deemed conclusively to have accepted such Owner's
Operating Expense Statement or Monthly Escalation Installment Notice, as the
case may be, and shall have no further right to dispute the same.
C. (1) Tenant or its usual auditors of its normal books and
records (provided same are certified public accountants) in each case at
Tenant's expense, shall have the right to examine those portions of Owner's
records which are reasonably required to verify the accuracy of any amounts
shown on any Owner's Operating Expense Statement provided Tenant shall notify
Owner of its desire to so examine such records within sixty (60) days next
following rendition of such Owner's Operating Expense Statement. Owner shall
maintain such records for a period of three (3) years following the expiration
of the Escalation Year to which they relate. Upon Tenant's timely request, Owner
shall make such records available and any such examination shall be conducted at
the office of Owner's accountants or at such other reasonable place designated
by Owner during normal office hours.
(2) Tenant acknowledges and agrees that not more than
three (3) of its employees or three (3) persons employed by such auditors shall
be entitled to entry to the offices of Owner at any one time for the purposes of
such review and inspection. Tenant hereby recognizes the confidential,
privileged and proprietary nature of such records and the information and data
contained therein, as well as any compromise, settlement or adjustment reached
between Owner and Tenant relating to the results of such examination, and Tenant
covenants and agrees for itself, and its employees, agents and representatives
(including, but not limited to, such auditors, and any attorneys or consultants
retained by Tenant as hereinafter provided), that such books, records,
information, data, compromise, settlement and adjustment will be held in the
strictest confidence and not be divulged, disclosed or revealed to any other
person except (x) to the extent required by law, court order or directive of any
Governmental Authority or (y) to such auditors or any attorneys retained by
Tenant or consultants retained by Tenant in connection with any action or
proceeding between Owner and Tenant as to Operating Expenses or Owner's
Operating Expense Statement and no examination of any such records shall be
permitted unless and until such auditors, attorneys and consultants
affirmatively agree and consent to be bound by the provisions of this Section
23.06C.
(3) Tenant agrees that this Section 23.06C is of material
importance to Owner and that any violation thereof shall result in immediate
harm to Owner and Owner shall have all rights allowed by law or equity if
Tenant, its employees, agents, and representatives (including, but not limited
to, such auditors, attorneys or consultants) violate the terms of this Section
23.06C, including, but not limited to, the right to terminate Tenant's right to
audit Owner's records in the future pursuant to this Section 23.06C, and Tenant
shall indemnify and hold Owner harmless of and from all loss, cost, damage,
liability and expense (including, but not limited to counsel fees and
disbursements) arising from a breach of the foregoing obligations of Tenant or
any of its employees, agents and representatives, (including but not limited to,
such auditors, attorneys or consultants). This obligation of Tenant and its
employees, agents and representatives (including, but not limited to, any such
auditors, attorneys or consultants) shall survive the expiration or sooner term
of the Demised Term.
Section 23.07. Collection of Increases in Fixed Rent: The obligations of
-------------------------------------
Owner and Tenant under the provisions of this Article with respect to any
increase in the Fixed Rent, or any credit to which Tenant may
40
be entitled, shall survive the expiration or any sooner termination of the
Demised Term. All sums payable by Tenant under this Article shall be collectible
by Owner in the same manner as Fixed Rent.
ARTICLE 24
NO WAIVER
---------
Section 24.01. Owner's Termination Not Prevented: Neither any option
---------------------------------
granted to Tenant in this Lease or in any collateral instrument to renew or
extend the Demised Term, nor the exercise of any such option by Tenant, shall
prevent Owner from exercising any option or right granted or reserved to Owner
in this Lease or in any collateral instrument or which Owner may have by virtue
of any law, to terminate this Lease and the Demised Term or any renewal or
extension of the Demised Term either during the original Demised Term or during
the renewed or extended term. Any termination of this Lease and the Demised
Term shall serve to terminate any such renewal or extension of the Demised Term
and any right of Tenant to any such renewal or extension, whether or not Tenant
shall have exercised any such option to renew or extend the Demised Term. Any
such option or right on the part of Owner to terminate this Lease shall continue
during any extension or renewal of the Demised Term. No option granted to
Tenant to renew or extend the Demised Term shall be deemed to give Tenant any
further option to renew or extend.
Section 24.02. No Termination by Tenant/No Waiver: No act or thing
----------------------------------
done by Owner or Owner's agents during the Demised Term shall constitute a valid
acceptance of a surrender of the Demised Premises or any remaining portion of
the Demised Term except a written instrument accepting such surrender, executed
by Owner. No employee of Owner or of Owner's agents shall have any authority to
accept the keys of the Demised Premises prior to the termination of this Lease
and the Demised Term, and the delivery of such keys to any such employee shall
not operate as a termination of this Lease or a surrender of the Demised
Premises; however, if Tenant desires to have Owner sublet the Demised Premises
for Tenant's account, Owner or Owner's agents are authorized to receive said
keys for such purposes without releasing Tenant from any of its obligations
under this Lease, and Tenant hereby relieves Owner of any liability for loss of,
or damage to, any of Tenant's property or other effects in connection with such
subletting. The failure by Owner to seek redress for breach or violation of, or
to insist upon the strict performance of, any term, covenant or condition of
this Lease on Tenant's part to be observed or performed, shall not prevent a
subsequent act or omission which would have originally constituted a breach or
violation of any such term, covenant or condition from having all the force and
effect of an original breach or violation. The receipt by Owner of rent with
knowledge of the breach or violation by Tenant of any term, covenant or
condition of this Lease on Tenant's part to be observed or performed shall not
be deemed a waiver of such breach or violation. Owner's failure to enforce any
Building Rule against Tenant or against any other tenant or occupant of the
Building shall not be deemed a waiver of any such Building Rule. Owner agrees
to enforce such Building Rules in a uniform manner. No provision of this Lease
shall be deemed to have been waived by Owner unless such waiver shall be set
forth in a written instrument executed by Owner. No payment by Tenant or
receipt by Owner of a lesser amount than the aggregate of all Fixed Rent and
additional rent then due under this Lease shall be deemed to be other than on
account of the first accruing of all such items of Fixed Rent and additional
rent then due, no endorsement or statement on any check and no letter
accompanying any check or other rent payment in any such lesser amount and no
acceptance of any such check or other such payment by Owner shall constitute an
accord and satisfaction, and Owner may accept any such check or payment without
prejudice to Owner's right to recover the balance of such rent or to pursue any
other legal remedy.
41
ARTICLE 25
MUTUAL WAIVER OF TRIAL BY JURY
------------------------------
Section 25.01. Owner and Tenant hereby waive trial by jury in any
action, proceeding or counterclaim brought by Owner or Tenant against the other
on any matter whatsoever arising out of or in any way connected with this Lease,
the relationship of landlord and tenant, the use or occupancy of the Demised
Premises by Tenant or any person claiming through or under Tenant, any claim of
injury or damage, and any emergency or other statutory remedy; however, the
foregoing waiver shall not apply to any action for personal injury or property
damage. The provisions of the foregoing sentence shall survive the expiration
or any sooner termination of the Demised Term. If Owner commences any summary
proceeding, or any other proceeding of like import, Tenant agrees: (i) not to
interpose any counterclaim of whatever nature or description in any such summary
proceeding, or any other proceeding of like import, unless failure to interpose
such counterclaim would preclude Tenant from asserting such claim in a separate
action or proceeding; and (ii) not to seek to remove to another court or
jurisdiction or consolidate any such summary proceeding, or other proceeding of
like import, with any action or proceeding which may have been, or will be,
brought by Tenant. In the event that Tenant shall breach any of its obligations
set forth in the immediately preceding sentence, Tenant agrees (a) to pay all of
Owner's attorneys' fees and disbursements in connection with Owner's enforcement
of such obligations of Tenant and (b) in all events, to pay all accrued, present
and future Fixed Rent and increases therein and additional rent payable pursuant
to the provisions of this Lease.
ARTICLE 26
INABILITY TO PERFORM
--------------------
Section 26.01. If, by reason of strikes or other labor disputes, fire
or other casualty (or reasonable delays in adjustment of insurance), accidents,
any Legal Requirements, any orders of any Governmental Authority or any other
cause beyond Owner's reasonable control, whether or not such other cause shall
be similar in nature to those hereinbefore enumerated, Owner is unable to
furnish or is delayed in furnishing any utility or service required to be
furnished by Owner under the provisions of Article 29 or any other Article of
this Lease or any collateral instrument, or is unable to perform or make or is
delayed in performing or making any installations, decorations, repairs,
alterations, additions or improvements, whether or not required to be performed
or made under this Lease or under any collateral instrument, or is unable to
fulfill or is delayed in fulfilling any of Owner's other obligations under this
Lease or any collateral instrument, no such inability or delay shall constitute
an actual or constructive eviction, in whole or in part, or entitle Tenant to
any abatement or diminution of rent, or relieve Tenant from any of its
obligations under this Lease, or impose any liability upon Owner or its agents
by reason of inconvenience or annoyance to Tenant, or injury to or interruption
of Tenant's business, or otherwise. Owner shall employ reasonable diligence to
attempt to eliminate the cause of such inability referred to in this Section
(however, the foregoing provisions of this sentence shall not apply in the event
of any strike or labor dispute and Owner shall not be required to employ labor
at overtime or other premium pay rates).
ARTICLE 27
NOTICES
-------
Section 27.01. Except as otherwise expressly provided in this Lease,
any bills, statements, notices, demands, requests or other communications given
or required to be given under this Lease shall be effective only if rendered or
given in writing, sent by registered or certified mail (return receipt requested
optional), addressed as follows:
(a) To Tenant (i) at Tenant's address set forth in
---------
this Lease if mailed prior to Tenant's taking possession of the Demised
Premises, or (ii) at the Building if mailed subsequent to Tenant's taking
42
possession of the Demised Premises, or (iii) at any place where Tenant or any
agent or employee of Tenant may be found if mailed subsequent to Tenant's
vacating, deserting, abandoning or surrendering the Demised Premises, with
copies to Bottomline Technologies, Inc., 000 Xxxxx Xxxxxx, Xxxxxxxxxx, XX 00000-
4050, Attention: Controller and Xxxx and Xxxx, LLP, 00 Xxxxx Xxxxxx, Xxxxxx, XX
00000, Attention Xxxx X. Xxxxxx, Esq., or
(b) To Owner at Owner's address set forth in this
--------
Lease, with a copy to Xxxxxxxx & Fleece, 000 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx
00000, Attention: Partner-in-Charge, Xxxxx Management, or
(c) addressed to such other address as either Owner or
Tenant may designate as its new address for such purpose by notice given to the
other in accordance with the provisions of this Section. Any such xxxx,
statement, notice, demand, request or other communication shall be deemed to
have been rendered or given on the date when it shall have been mailed as
provided in this Section.
Nothing contained in this Section 27.01 shall preclude, limit or modify Owner's
service of any notice, statement, demand or other communication in the manner
required by law, including, but not limited to, any demand for rent under
Article 7 of the New York Real Property Actions and Proceedings Law or any
successor law of like import.
ARTICLE 28
PARTNERSHIP TENANT
------------------
43
Section 28.01. If Tenant is a partnership or professional corporation
or limited liability company (or is comprised of two (2) or more persons,
individually and as co-partners of a partnership or shareholders of a
professional corporation or members of a limited liability company) or if
Tenant's interest in this Lease shall be assigned to a partnership or
professional corporation or limited liability company (or to two (2) or more
persons, individually and as co-partners of a partnership or shareholders of a
professional corporation or members of a limited liability company) pursuant to
Article 11 (any such partnership, professional corporation, limited liability
company and such persons are referred to in this Section as "Partnership
-----------
Tenant"), the following provisions of this Section shall apply to such
Partnership Tenant: (i) the liability of each of the persons comprising
Partnership Tenant shall be joint and several, individually and as a partner or
shareholder or member, with respect to all obligations of the Tenant under this
Lease whether or not such obligations arose prior to, during, or after any
period when any party comprising Partnership Tenant was a member or shareholder
of Partnership Tenant, and (ii) each of the persons comprising Partnership
Tenant, whether or not such person shall be one of the persons comprising Tenant
at the time in question, hereby consents in advance to, and agrees to be bound
by, any written instrument which may hereafter be executed, changing, modifying
or discharging this Lease, in whole or in part, or surrendering all or any part
of the Demised Premises to Owner, and by any notices, demands, requests or other
communications which may hereafter be given by Partnership Tenant or by any of
the persons comprising Partnership Tenant, and (iii) any bills, statements,
notices, demands, requests or other communications given or rendered to
Partnership Tenant or to any of the persons comprising Partnership Tenant shall
be deemed given or rendered to Partnership Tenant and to all such persons and
shall be binding upon Partnership Tenant and all such persons, and (iv) if
Partnership Tenant shall admit new partners or shareholders or members, all of
such new partners or shareholders or members, as the case may be, shall, by
their admission to Partnership Tenant, be deemed to have assumed performance of
all of the terms, covenants and conditions of this Lease on Tenant's part to be
observed and performed, and shall be liable for such performance, together with
all other parties, jointly or severally, individually and as a partner or
shareholder or member, whether or not the obligation to comply with such terms,
covenants or conditions arose prior to, during or after any period when any
party comprising Partnership Tenant was a member or shareholder of Partnership
Tenant and (v) Partnership Tenant shall give prompt notice to Owner of the
admission of any such new partners, or shareholders, or members, as the case may
be, and, upon demand of Owner, shall cause each such new partner or shareholder
or member to execute and deliver to Owner an agreement, in form satisfactory to
Owner, wherein each such new partner or shareholder or member shall so assume
performance of all of the terms, covenants and conditions of this Lease on
Tenant's part to be observed and performed whether or not the obligation to
comply with such terms, covenants or conditions arose prior to, during or after
any period when any party comprising Partnership Tenant was a member or
shareholder of Partnership Tenant (but neither Owner's failure to request any
such agreement nor the failure of any such new partner, shareholder or member to
execute or deliver any such agreement to Owner shall vitiate the provisions of
subdivision (iv) or any other provision of this Section).
ARTICLE 29
UTILITIES AND SERVICES
----------------------
Section 29.01. Elevators: As long as Tenant is not in default under
---------
any of the terms, covenants or conditions of this Lease on Tenant's part to be
observed or performed, Owner, at Owner's expense, shall furnish necessary
passenger elevator facilities twenty-four (24) hours per day on business days
(as defined in Section 31.01) and on Saturdays from 8:00 A.M. to 6:00 P.M. and
shall have a passenger elevator subject to call at all other times. Tenant
shall be entitled to the non-exclusive use of the freight elevator in common
with other tenants and occupants of the Building from 8:00 A.M. to 6:00 P.M. on
business days, subject to such reasonable rules as Owner may adopt for the use
of the freight elevator. At any time or times all or any of the elevators in
the Building may, at Owner's option, be automatic elevators, and Owner shall not
be required to furnish any operator service for automatic elevators. If Owner
shall, at any time, elect to furnish operator service for any automatic
elevators, Owner shall have the right to discontinue furnishing such service
with the same effect as if Owner had never elected to furnish such service.
44
Section 29.02. Heat: As long as Tenant is not in default under any
----
of the terms, covenants or conditions of this Lease on Tenant's part to be
observed or performed, Owner, at Owner's expense, shall furnish heat to the
Demised Premises, as and when required by law, twenty-four (24) hours per day.
Section 29.03. Air Conditioning and Ventilation: As long as Tenant
--------------------------------
is not in default under any of the terms, covenants or conditions of this Lease
on Tenant's part to be observed or performed, Owner, at Owner's expense, shall
furnish and distribute to the Demised Premises (i) conditioned air at reasonable
temperatures, pressures and degrees of humidity and in reasonable volumes and
velocities, twenty-four (24) hours per day during the months of May, June, July,
August, September and October when required for the comfortable occupancy of the
Demised Premises; and (ii) mechanical ventilation through the Building air
conditioning system twenty-four (24) hours per day throughout the year, except
when conditioned air or heat is being furnished. Notwithstanding the foregoing
provisions of this Section, Owner shall not be responsible if the normal
operation of the Building air conditioning system shall fail to provide
conditioned air at reasonable temperatures, pressures or degrees of humidity or
in reasonable volumes or velocities in any portions of the Demised Premises (a)
which, by reason of any machinery or equipment installed by or on behalf of
Tenant or any person claiming through or under Tenant, shall have an electrical
load in excess of four (4) xxxxx per square foot of usable area for all purposes
(including lighting and power), or which shall have a human occupancy factor in
excess of one person per 100 square feet of usable area (the average electrical
load and human occupancy factors for which the Building air conditioning system
is designed) or (b) because of any rearrangement of partitioning or other
Alterations made or performed by or on behalf of Tenant or any person claiming
through or under Tenant. Whenever said air conditioning system is in operation,
Tenant agrees to cause all the windows in the Demised Premises to be kept closed
and to cause the venetian blinds in the Demised Premises to be kept closed if
necessary because of the position of the sun. Tenant agrees to cause all the
windows in the Demised Premises to be closed whenever the Demised Premises are
not occupied. Tenant shall cooperate fully with Owner at all times and abide by
all regulations and requirements which Owner may reasonably prescribe for the
proper functioning and protection of the air conditioning and ventilating
system. Tenant agrees that if its violation or breach of any of the foregoing
provisions of this Section, shall adversely affect the operation of the
Building's heating, ventilation and air conditioning system, no such adverse
affects shall constitute an actual or constructive eviction, in whole or in
part, or entitle Tenant to any abatement or diminution of rent, or relieve
Tenant from any of its obligations under this Lease, or impose any liability
upon Owner, or its agents, by reason of inconvenience or annoyance to Tenant, or
injury to or interruption of Tenant's business, or otherwise. The Building
heating, ventilating and air conditioning system unit serving the floor of the
Building on which the Demised Premises are located shall contain the following
specifications: (1) said unit shall be a water cooled variable air volume (VAV)
unit via a plug fan; (2) said unit shall have a high energy efficiency rating
(EER); (3) said unit shall have a factory mounted economizer coil with controls
which allow water cooling without compressor operation; (4) said unit shall have
factory mounted internal variable frequency drive (VFD); (5) said unit shall
have factory mounted direct digital control (DDC) microprocessor controls; and
(6) said unit shall have internally isolated fans on spring isolators.
Section 29.04. Cleaning: A. Tenant, at Tenant's expense, shall keep
--------
the Demised Premises in order, shall cause the Demised Premises to be cleaned
and shall cause Tenant's refuse and rubbish to be removed, all at regular
intervals in accordance with standards and practices adopted by Owner for the
Building. Tenant shall cooperate with any waste and garbage recycling program
of the Building and shall comply with all reasonable rules and regulations of
Owner with respect thereto. Tenant, at Tenant's expense, shall cause all
portions of the Demised Premises used for the storage, preparation, service or
consumption of food or beverages to be cleaned daily in a manner satisfactory to
Owner, and to be exterminated against infestation by vermin, roaches or rodents
regularly and, in addition, whenever there shall be evidence of any infestation.
B. Owner, at Owner's expense, shall clean the public
portions of the Building at regular intervals in accordance with practices and
standards adopted by Owner for the Building.
C. The removal of refuse and rubbish and the
furnishing of office cleaning services to Tenant by persons other than Owner and
its contractors shall be performed in accordance with such regulations and
requirements as, in Owner's judgment, are necessary for the proper operation of
the Building, and Tenant
45
agrees that Tenant will not permit any person to enter the Demised Premises or
the Building for such purposes, or for the purpose of providing extermination
services required to be performed by Tenant pursuant to Subsection A of this
Section, other than persons first approved by Owner, such approval not
unreasonably to be withheld.
Section 29.05. Electricity: A. As long as Tenant is not in default
-----------
under any of the terms, covenants or conditions of this Lease on Tenant's part
to be observed or performed, Owner shall redistribute or furnish electrical
energy to or for the use of Tenant in the Demised Premises for the operation of
the lighting fixtures and the electrical receptacles installed in the Demised
Premises on the Commencement Date and the operation of the Building heating,
ventilating and air conditioning system unit serving the floor of the Building
on which the Demised Premises are located. If either the quantity or character
of electrical service is changed by the corporation(s) and/or other entity(ies)
selected by Owner to supply electrical service to the Building or is no longer
available or suitable for Tenant's requirements, or if any equipment
supplementing or ancillary to such electrical service which is installed in the
Building by or on behalf of said corporation(s) and/or other entity(ies)
malfunctions or fails to operate for any reason while Tenant has made any
connections to said equipment, no such change, unavailability, unsuitability,
malfunction or failure to operate shall constitute an actual or constructive
eviction, in whole or in part, or entitle Tenant to any abatement or diminution
of rent, or relieve Tenant from any of its obligations under this Lease, or
impose any liability upon Owner, or its agents, by reason of inconvenience or
annoyance to Tenant, or injury to or interruption of Tenant's business or
otherwise.
B. Owner represents that the electrical feeder or
riser capacity serving the Demised Premises on the Commencement Date shall be
adequate to serve the lighting fixtures and electrical receptacles installed in
the Demised Premises on the Commencement Date. Any additional feeders or risers
to supply Tenant's additional electrical requirements, and all other equipment
proper and necessary in connection with such feeders or risers shall be
installed by Owner upon Tenant's request, at the sole cost and expense of
Tenant, provided, that, in Owner's reasonable judgment, such additional feeders
or risers are necessary and are permissible under applicable laws and insurance
regulations and the installation of such feeders or risers will not cause
permanent damage or injury to the Building or the Demised Premises or cause or
create a dangerous or hazardous condition or entail excessive or unreasonable
alterations or repairs to or interfere with or disturb other tenants or
occupants of the Building. Tenant covenants that at no time shall the use of
electrical energy in the Demised Premises exceed the capacity of the existing
feeders or risers or wiring installations then serving the Demised Premises.
C. Prior to the Commencement Date Owner, at Owner's
expense, shall have installed a submeter or submeters in the Demised Premises to
measure Tenant's actual consumption of electricity in the entire Demised
Premises. Tenant shall pay to Owner, from time to time, upon demand, for the
electricity consumed in the Demised Premises, as determined by such submeter or
submeters, the actual cost to Owner of purchasing electricity for the Demised
Premises (as such actual cost is hereinafter defined) plus all applicable taxes
thereon. Owner's actual cost for Tenant's KW and KWH shall be determined by the
application of the Building's electric rate schedule per month from the
corporation(s) and/or other entity(ies) selected by Owner to supply electrical
service to the Building to Tenant's usage. With respect to any period when any
such submeter is not in good working order, Tenant shall pay Owner for
electricity consumed in the portion of the Demised Premises served by such
submeter at the rate paid by Tenant to Owner during the most recent comparable
period when such submeter was in good working order. Tenant shall take good care
of any such submeter and all submetering installation equipment, at Tenant's
sole cost and expense, and make all repairs thereto occasioned by any acts,
omissions or negligence of Tenant or any person claiming through or under Tenant
as and when necessary to insure that any such submeter is, at all times during
the Demised Term, in good working order. With respect to the period (referred to
as the "Interim Period"), if any, from the Commencement Date through the date
--------------
immediately prior to the date upon which the submeter or submeters shall be
operable, Tenant shall pay to Owner monthly on demand of Owner, for the
electricity consumed in the Demised Premises, a sum equal to one-twelfth
(1/12th) of the product of (x) $1.50 multiplied by (y) the Demised Premises
Area. With respect to any period during the Interim Period constituting less
than a full calendar month, the monthly payment referred to in the preceding
sentence shall be appropriately prorated.
46
D. Owner may, at any time, elect to discontinue the
redistribution or furnishing of electrical energy. In the event of any such
election by Owner, (i) Owner agrees to give reasonable advance notice of any
such discontinuance to Tenant, (ii) Owner agrees to permit Tenant to receive
electrical service directly from the corporation(s) and/or other entity(ies)
selected by Owner to supply electrical service to the Building and to permit the
existing feeders, risers, wiring and other electrical facilities serving the
Demised Premises to be used by Tenant for such purpose to the extent they are
suitable and safely capable, (iii) Owner agrees to pay such charges and costs,
if any, as such corporation(s) and/or other entity(ies) may impose in connection
with the installation of Tenant's meters, (iv) the provisions of Subsection C of
this Section 29.05 shall be deemed deleted from this Lease, and (v) this Lease
shall remain in full force and effect and such discontinuance shall not
constitute an actual or constructive eviction, in whole or in part, or entitle
Tenant to any abatement or diminution of rent, or relieve Tenant from any of its
obligations under this Lease, or impose any liability upon Owner or its agents
by reason of inconvenience or annoyance to Tenant, or injury to or interruption
of Tenant's business, or otherwise.
E. Notwithstanding anything to the contrary set forth
in this Lease, any sums payable or granted in any way by the corporation(s)
and/or other entity(ies) selected by Owner to supply electricity to the Building
resulting from the installation in the Demised Premises of energy efficient
lighting fixtures, lamps, special supplemental heating, ventilation and air
conditioning systems or any other Alterations, which sums are paid or given by
way of rebate, direct payment, credit or otherwise, shall be and remain the
property of Owner, and Tenant shall not be entitled to any portion thereof,
unless such lighting fixtures, lamps, supplemental heating, ventilation and air
conditioning systems or other Alterations were installed by Tenant, solely at
Tenant's expense, without any contribution, credit or allowance by Owner, in
accordance with all of the provisions of this Lease. Nothing contained in the
foregoing sentence, however, shall be deemed to obligate Owner to supply or
install in the Demised Premises any such lighting fixtures, lamps, supplemental
heating, ventilation and air conditioning systems or other Alterations.
F. Tenant acknowledges that the Building heating,
ventilating and air conditioning system unit serving the floor of the Building
on which the Demised Premises are located (referred to herein as the "Floor HVAC
Unit") shall not be connected to the submeter(s) serving the Demised Premises,
but, instead, shall be connected to a separate meter(s) measuring the electrical
energy consumed by such Floor HVAC Unit. Accordingly, Tenant agrees that during
the Demised Term, Tenant shall pay to Owner, from time to time upon demand of
Owner and submission by Owner to Tenant of invoices or bills therefor, thirty-
three and 24/100 (33.24%) percent (hereinafter "Tenant's Electrical Share") of
all amounts shown on said separate meter(s) for such Floor HVAC Unit.
G. Tenant acknowledges that the light and power
systems serving the public areas of the floor of the Building on which the
Demised Premises are located (referred to herein as the "Floor Public Light and
Power") shall not be connected to the submeter(s) serving the Demised Premises
but, instead, shall be connected to a separate meter(s) measuring the electrical
energy consumed by such Floor Public Light and Power. Accordingly, Tenant agrees
that during the Demised Term, Tenant shall pay to Owner, from time to time upon
demand of Owner and submission by Owner to Tenant of invoices or bills therefor,
Tenant's Electrical Share of all amounts shown on said separate meter(s) for
such Floor Public Light and Power.
Section 29.06. Water: If Tenant requires, uses or consumes water for
-----
any purpose in addition to ordinary lavatory and drinking purposes, Owner may
install a hot water meter and a cold water meter and thereby measure Tenant's
consumption of water for all purposes. Tenant shall pay to Owner the cost of
any such meters and their installation, and Tenant shall keep any such meters
and any such installation equipment in good working order and repair, at
Tenant's cost and expense. Tenant agrees to pay for water consumed as shown on
said meters, and sewer charges, taxes and any other governmental charges
thereon, as and when bills are rendered. In addition to any sums required to be
paid by Tenant for hot water consumed and sewer charges, taxes and any other
governmental charges thereon under the foregoing provisions of this Section,
Tenant agrees to pay to Owner, for the heating of said hot water, an amount
equal to three (3X) times the total of said sums required to be paid by Tenant
for hot water and sewer charges thereon. For the purposes of determining the
amount of any sums required to be paid by Tenant under this Section, all hot and
cold water consumed during any period when said meters are not in good working
order shall be deemed to have
47
been consumed at the rate of consumption of such water during the most
comparable period when such meters were in good working order.
Section 29.07. Overtime Periods: The Fixed Rent does not reflect or
----------------
include any charge to Tenant for the furnishing or distributing of any necessary
elevator facilities (other than an elevator subject to call) to the Demised
Premises during periods (referred to as "Overtime Periods") other than the hours
----------------
and days set forth above in this Article for the furnishing and distributing of
such services. Accordingly, if Owner shall furnish any such elevator facilities
to the Demised Premises at the request of Tenant during Overtime Periods, Tenant
shall pay Owner for such services at the following rates as of the date of this
Lease: $65.00 Dollars per hour for freight elevator service. Any increases
above such rates shall be in an amount equal to the actual increases after the
date of this Lease in the cost to Owner of furnishing such services. Owner
shall not be required to furnish any such services during Overtime Periods,
unless Owner has received reasonable advance notice from Tenant requesting such
services. If Tenant fails to give Owner reasonable advance notice requesting
such services during any Overtime Periods, then, failure by Owner to furnish any
such services during such Overtime Periods shall not constitute an actual or
constructive eviction, in whole or in part, or entitle Tenant to any abatement
or diminution of rent, or relieve Tenant from any of its obligations under this
Lease, or impose any liability upon Owner or its agents by reason of
inconvenience or annoyance to Tenant, or injury to or interruption of Tenant's
business or otherwise.
Section 29.08. Owner's Right to Stop Service: Owner reserves the
-----------------------------
right to stop the service of the heating, air conditioning, ventilating,
elevator, plumbing, electrical, communications or other mechanical systems or
facilities in the Building when necessary by reason of accident or emergency, or
for repairs, alterations, replacements or improvements, which, in the judgment
of Owner are desirable or necessary, until said repairs, alterations,
replacements or improvements shall have been completed. The exercise of such
right by Owner shall not constitute an actual or constructive eviction, in whole
or in part, or entitle Tenant to any abatement or diminution of rent, or relieve
Tenant from any of its obligations under this Lease, or impose any liability
upon Owner or its agents by reason of inconvenience or annoyance to Tenant, or
injury to or interruption of Tenant's business, or otherwise. Owner shall
employ reasonable diligence in attempting to restore the operation of any such
systems or facilities without any obligation, however, to employ labor at
overtime or other premium pay rates.
Section 29.09. A. Tenant's Supplemental A/C Unit/Cooling Tower:
--------------------------------------------
Supplementing the provisions of Section 29.06, in the event (a) a separate air
conditioning system to serve the Demised Premises is installed by or on behalf
of Tenant in accordance with the provisions of this Lease (referred to herein as
"Tenant's Supplemental A/C Unit"), (b) Tenant requests that such Unit be hooked
------------------------------
up to any Building cooling tower and associated piping (referred to herein as
the "Cooling Tower") and (c) Owner consents to such hookup, then, in those
-------------
events, Owner agrees, subject to the provisions of Article 26 and Section 29.08,
to supply condenser water to Tenant's Supplemental A/C Unit and Tenant agrees
that (i) Tenant shall pay to Owner, upon demand, all costs and expenses incurred
by Owner in connection with the hookup of such Unit to the Cooling Tower,
including, but not limited to, the Building standard hookup fee then charged by
Owner, and (ii) from and after the date the hookup is completed, the Fixed Rent
reserved in this Lease shall be increased by a sum (referred to herein as the
"Tenant's Cooling Tower Use Charge") equal to (x) the standard per ton charge
----------------------------------
then in effect in the Building, multiplied by (xx) the number of tons of
Tenant's Supplemental A/C Unit.
B. If the regular hourly wage rate of operating
engineers employed in the Building shall be increased in any Escalation Year (as
defined in Article 23) over the rate in effect on the January 1/st/ immediately
preceding such hookup, the Fixed Rent for such Escalation Year shall be
increased by a sum equal to that proportion of Tenant's Cooling Tower Use Charge
which such increase in said hourly wage rate bears to the hourly wage rate in
effect on the January 1/st/ immediately preceding such hookup. The increase in
Fixed Rent for any Escalation Year pursuant to the provisions of the immediately
preceding sentence shall be shown on the Owner's Operating Expense Statement
with respect to such Escalation Year rendered by Owner pursuant to the
provisions of said Article 23, and shall be payable by Tenant as if it were an
increase in the Fixed Rent pursuant to the provisions of said Article 23.
48
C. Any increase in Fixed Rent for Tenant's Cooling
Tower Use Charge shall be effective as of the date Tenant's Supplemental A/C
Unit is hooked up to the Cooling Tower and shall be retroactive to such date if
necessary.
D. Tenant's Supplemental A/C Unit shall be repaired
and maintained by Tenant at Tenant's cost and expense, pursuant to a service
contract.
ARTICLE 30
TABLE OF CONTENTS, ETC.
-----------------------
Section 30.01. Table of Contents/Captions: The Table of Contents and
--------------------------
the captions following the Articles and Sections of this Lease have been
inserted solely as a matter of convenience and in no way define or limit the
scope or intent of any provision of this Lease.
ARTICLE 31
MISCELLANEOUS DEFINITIONS, SEVERABILITY AND INTERPRETATION PROVISIONS
---------------------------------------------------------------------
Section 31.01. The term "business days" as used in this Lease shall
-------------
exclude Saturdays, Sundays and holidays, the term "Saturdays" as used in this
---------
Lease shall exclude holidays and the term "holidays" as used in this Lease shall
--------
mean all days observed as legal holidays by either the New York State Government
or the Federal Government.
Section 31.02. The terms "person" and "persons" as used in this Lease
------ -------
shall be deemed to include natural persons, firms, corporations, associations
and any other private or public entities, whether any of the foregoing are
acting on their own behalf or in a representative capacity.
Section 31.03. The term "prime rate" shall mean the rate of interest
----------
announced publicly by Chemical Bank, or its successor, from time to time, as
Chemical Bank's or such successor's base rate, or if there is no such base rate,
then the rate of interest charged by Chemical Bank or its successor to its most
credit worthy customers on commercial loans having a ninety (90) day duration.
Section 31.04. If any term, covenant or condition of this Lease or
any application thereof shall be invalid or unenforceable, the remainder of this
Lease and any other application of such term, covenant or condition shall not be
affected thereby.
Section 31.05. This Lease shall be construed without regard to any
presumption or other rule requiring construction against the party causing this
Lease to be drafted. In the event of any action, suit, dispute or proceeding
affecting the terms of this Lease, no weight shall be given to any deletions or
striking out of any of the terms of this Lease contained in any draft of this
Lease and no such deletion or strike out shall be entered into evidence in any
such action, suit or dispute or proceeding given any weight therein.
Section 31.06. Subject to the provisions of this Lease including, but
not limited to, Article 3 hereof Owner shall make available reasonably
sufficient telecommunication riser access at a riser terminating at the
telecommunications closets located on the floor of which the Demised Premises
are a part. The riser shall provide reasonably sufficient access to allow
Tenant to bring T3 lines to the Demised Premises. Tenant shall be responsible,
at its sole cost and expense (including the cost of installing any required
conduits) of installing such T3 lines.
49
ARTICLE 32
ADJACENT EXCAVATION
-------------------
Section 32.01. If an excavation shall be made upon land adjacent to
the Real Property, or shall be authorized to be made, Tenant shall afford to the
person causing or authorized to cause such excavation license to enter upon the
Demised Premises for the purpose of doing such work as said person shall deem
necessary to preserve the walls and other portions of the Building from injury
or damage and to support the same by proper foundations and no such entry shall
constitute an actual or constructive eviction, in whole or in part, or entitle
Tenant to any abatement or diminution of rent, or relieve Tenant from any of its
obligations under this Lease, or impose any liability upon Owner or said person.
ARTICLE 33
BUILDING RULES
--------------
Section 33.01. Tenant shall observe faithfully, and comply with, and
shall not permit the violation of, the Building Rules set forth in Schedule A
annexed to and made a part of this Lease and such additional reasonable Building
Rules as Owner may, from time to time, adopt. All of the terms, covenants and
conditions of Schedule A are incorporated in this Lease by reference and shall
be deemed part of this Lease as though fully set forth in the body of this
Lease. The term "Building Rules" as used in this Lease shall include those set
--------------
forth in Schedule A and those hereafter made or adopted as provided in this
Section. In case Tenant disputes the reasonableness of any additional Building
Rule hereafter adopted by Owner, the parties hereto agree to submit the question
of the reasonableness of such Building Rule for decision to the Chairman of the
Board of Directors of the Management Division of the Real Estate Board of New
York, Inc., or its successor (the "Chairman"), or to such impartial person or
--------
persons as the Chairman may designate, whose determination shall be final and
conclusive upon Owner and Tenant. Tenant's right to dispute the reasonableness
of any additional Building Rule shall be deemed waived unless asserted by
service of a notice upon Owner within ten (10) days after the date upon which
Owner shall give notice to Tenant of the adoption of any such additional
Building Rule. Owner shall have no duty or obligation to enforce any Building
Rule, or any term, covenant or condition of any other lease, against any other
tenant or occupant of the Building, and Owner's failure or refusal to enforce
any Building Rule or any term, covenant or condition of any other lease against
any other tenant or occupant of the Building shall not constitute an actual or
constructive eviction, in whole or in part, or entitle Tenant to any abatement
or diminution of rent, or relieve Tenant from any of its obligations under this
Lease, or impose any liability upon Owner or its agents by reason of
inconvenience or annoyance to Tenant, or injury to or interruption of Tenant's
business, or otherwise. Any Building Rule not enforced generally against other
tenants of the Building shall not be enforced against Tenant.
Section 33.02. Any Building Rule not enforced generally against other
tenants of the Building shall not be enforced against Tenant. Wherever the
Building Rules provide for a matter to be determined by Owner or its agents,
Owner or its agents shall exercise their reasonable judgment with respect
thereto and any determination to be made by Owner or its agents thereunder shall
not be unreasonably withheld or delayed.
ARTICLE 34
BROKER
------
Section 34.01. Tenant represents and warrants to Owner that this
Lease was negotiated directly between Owner and Tenant and that no broker was
responsible for bringing about this Lease. Tenant shall indemnify
50
Owner from all loss, cost, liability, damage and expenses, including, but not
limited to, reasonable counsel fees and disbursements, arising from any breach
of the foregoing representation and warranty.
ARTICLE 35
Section 35.01. The sum of NINETEEN THOUSAND NINE HUNDRED FORTY-FOUR
and 00/100 ($19,944.00) DOLLARS representing security (referred to as
"Security") for the faithful performance and observance by Tenant of the terms,
--------
covenants and conditions of this Lease on Tenant's part to be observed and
performed is due and payable at the time of the execution and delivery of this
Lease. In the event of any default by Tenant in the observance or performance
of any of the terms, covenants or conditions of this Lease on the part of Tenant
to be observed or performed including, but not limited to, any default in the
payment when due of any monthly installment of the Fixed Rent or increase in the
Fixed Rent payable pursuant to the provisions of Articles 23 or 29 or of any
additional rent, Owner may use or apply all or any part of the Security for the
payment to Owner for Tenant's account of any sum or sums due under this Lease,
without thereby waiving any other rights or remedies of Owner with respect to
such default. Tenant agrees to replenish all or any part of the Security so
used or applied during the Demised Term. After (i) the Expiration Date or any
other date upon which the Demised Term shall expire and come to an end, and (ii)
the full observance and performance by Tenant of all of the terms, covenants and
conditions of this Lease on Tenant's part to be observed and performed,
including, but not limited to, the provisions of Article 21, Owner shall return
to Tenant the balance of the Security then held or retained by Owner. Owner
agrees that, unless prohibited by law or by the general policies of lending
institutions in New York City, Owner shall deposit the Security in an interest-
bearing savings account with a bank selected by Owner, in which event all
interest accruing thereon shall be added to and become part of the Security and
shall be retained by Owner under the same conditions as the sum originally
deposited as Security. Tenant agrees that Tenant shall not assign or encumber
any part of the Security, and no assignment or encumbrance by Tenant of all or
any part of the Security shall be binding upon Owner, whether made prior to,
during, or after the Demised Term. Owner shall not be required to exhaust its
remedies against Tenant or against the Security before having recourse to any
other form of security held by Owner and recourse by Owner to any form of
security shall not affect any remedies of Owner which are provided in this Lease
or which are available to Owner in law or equity. In the event of any sale,
assignment or transfer by Owner named herein (or by any subsequent Owner) of its
interest in the Building as owner or lessee, Owner (or such subsequent owner)
shall have the right to assign or transfer the Security to its grantee, assignee
or transferee and, in the event of such assignment or transfer, Owner named
herein, (or such subsequent Owner) shall have no liability to Tenant for the
return of the Security and Tenant shall look solely to the grantee, assignee or
transferee for such return. A lease of the entire Building shall be deemed a
transfer within the meaning of the foregoing sentence. Notwithstanding anything
to the contrary set forth in the foregoing provisions of this Article, Owner
shall be entitled to retain the one (1%) percent administrative fee permitted by
law to be retained by landlords with respect to security deposits.
ARTICLE 36
ARBITRATION, ETC.
-----------------
Section 36.01. Any dispute (i) with respect to the reasonability of
any failure or refusal of Owner to grant its consent or approval to any request
for such consent or approval pursuant to the provisions of Sections 3.01 or
11.03 with respect to which request Owner has agreed, in such Sections, not
unreasonably to withhold such consent or approval, or (ii) arising out of the
application of the Operating Expenses provisions of Article 23, (iii) as to the
validity of any assignment in accordance with the provisions of Section 11.06
which is submitted to arbitration shall be finally determined by arbitration in
the City of New York in accordance with the rules and regulations then obtaining
of the American Arbitration Association or its successor. Any such determi-
51
nation shall be final and binding upon the parties, whether or not a judgment
shall be entered in any court. In making their determination, the arbitrators
shall not subtract from, add to, or otherwise modify any of the provisions of
this Lease. Owner and Tenant may, at their own expense, be represented by
counsel and employ expert witnesses in any such arbitration. Any dispute with
respect to the reasonability of any failure or refusal of Owner to grant its
consent or approval to any request for such consent or approval pursuant to any
of the provisions of this Lease (other than Sections 3.01 and 11.03) with
respect to which Owner has covenanted not unreasonably to withhold such consent
or approval, and any dispute arising with respect to the increases in Fixed Rent
due to the provisions of Section 23.02 shall be determined by applicable legal
proceedings. If the determination of any such legal proceedings, or of any
arbitration held pursuant to the provisions of this Section with respect to
disputes arising under Sections 3.01, 11.03 and 11.06 or the Operating Expense
provisions of Article 23, shall be adverse to Owner, Owner shall be deemed to
have granted the requested consent or approval, or be bound by any determination
as to Taxes and Operating Expenses and the increases in Fixed Rent relating
thereto, or the validity of any assignment, but that shall be Tenant's sole
remedy in such event and Owner shall not be liable to Tenant for a breach of
Owner's covenant not unreasonably to withhold such consent or approval, or
otherwise. Each party shall pay its own counsel and expert witness fees and
expenses, if any, in connection with any arbitration held pursuant to the
provisions of this Section and the parties will share all other expenses and
fees of any such arbitration.
ARTICLE 37
PARTIES BOUND
-------------
Section 37.01. The terms, covenants and conditions contained in this
Lease shall bind and inure to the benefit of Owner and Tenant and, except as
otherwise provided in this Lease, their respective heirs, distributees,
executors, administrators, successors and assigns. However, the obligations of
Owner under this Lease shall no longer be binding upon Owner named herein after
the sale, assignment or transfer by Owner named herein (or upon any subsequent
Owner after the sale, assignment or transfer by such subsequent Owner) of its
interest in the Building as owner or lessee, and in the event of any such sale,
assignment or transfer, such obligations shall thereafter be binding upon the
grantee, assignee or other transferee of such interest, and any such grantee,
assignee or transferee, by accepting such interest, shall be deemed to have
assumed such obligations. A lease of the entire Building shall be deemed a
transfer within the meaning of the foregoing sentence. Neither the partners
(direct or indirect) comprising Owner, nor the shareholders (nor any of the
partners comprising same), partners, directors or officers of any of the
foregoing (collectively, the "Owner's Parties") shall be liable for the
---------------
performance of Owner's obligations under this Lease. Tenant shall look solely
to Owner to enforce Owner's obligations hereunder and shall not seek any damages
against any of the Owner's Parties. Notwithstanding anything contained in this
Lease to the contrary, Tenant shall look solely to the estate and interest of
Owner, its successors and assigns, in the Real Property and Building for the
collection or satisfaction of any judgment recovered against Owner based upon
the breach by Owner of any of the terms, conditions or covenants of this Lease
on the part of Owner to be performed, and no other property or assets of Owner
or any of Owner's Parties shall be subject to levy, execution or other
enforcement procedure for the satisfaction of Tenant's remedies under or with
respect to either this Lease, the relationship of landlord and tenant hereunder,
or Tenant's use and occupancy of the Demised Premises.
52
IN WITNESS WHEREOF, Owner and Tenant have respectively signed and
sealed this Lease as of the day and year first above written.
00 XXXXX XXXXXX L.P.
By: 00 Xxxxx Xxxxxx LLC, its general partner
Witness:
_____________________________ By:_____________________________
Owner
Name:
Title: Managing Member
BOTTOMLINE TECHNOLOGIES, INC.
Witness:
_____________________________ By:_____________________________
Tenant
Name:
Title:
53
UNIFORM FORM CERTIFICATE OF ACKNOWLEDGMENT
(Within New York State)
State of New York )
:ss.:
County of _______ )
On the ____________ day of _________________, in the year ___________,
before me, the undersigned, personally appeared _________________________,
personally known to me or proved to me on the basis of satisfactory evidence to
be the individual(s) whose name(s) is (are) subscribed to the within instrument
and acknowledged to me that he/she/they executed the same in his/her/their
capacity(ies), and that by his/her/their signature(s) on the instrument, the
individual(s), or the person upon behalf of which the individual(s) acted,
executed the instrument.
________________________________________
(Signature and Office of individual taking acknowledgment)
UNIFORM FORM CERTIFICATE OF ACKNOWLEDGMENT
(Outside of New York State)
State, District of Columbia, Territory,
Possession or Foreign Country
_______________________________):ss.:
On the ______ day of _________________ in the year _________, before
me, the undersigned, personally appeared _______________________, personally
known to me or proved to me on the basis of satisfactory evidence to be the
individual(s) whose name(s) is (are) subscribed to the within instrument and
acknowledged to me that he/she/they executed the same in his/her/their
capacity(ies), that by his/her/their signature(s) on the instrument, the
individual(s), or the person upon behalf of which the individual(s) acted,
executed the instrument, and that such individual made such appearance before
the undersigned in the _____________________. (Insert the city or other
political subdivision and the state or country or other place the acknowledgment
was taken.)
______________________________________
(Signature and office of individual taking acknowledgment)
54
SCHEDULE A
BUILDING RULES
1. The sidewalks, entrances, passages, courts, elevators, vestibules,
stairways, corridors or halls of the Building shall not be obstructed or
encumbered or used for any purpose other than ingress and egress to and from the
premises demised to any tenant or occupant. Any tenant whose premises are
situate on the ground floor of the Building shall, at said tenant's own expense,
keep the sidewalks and curb directly in front of said premises clean and free
from ice and snow.
2. No awnings or other projections shall be attached to the outside walls
or windows of the Building without the prior consent of Owner. No curtains,
blinds, shades, or screens shall be attached to or hung in, or used in
connection with, any window or door of the premises demised to any tenant or
occupant, without the prior consent of Owner. Such awnings, projections,
curtains, blinds, shades, screens or other fixtures must be of a quality, type,
design and color, and attached in a manner, approved by Owner.
3. No sign, advertisement, object, notice or other lettering shall be
exhibited, inscribed, painted or affixed on any part of the outside or inside of
the premises demised to any tenant or occupant or of the Building without the
prior consent of Owner. Interior signs on doors and directory tablets, if any,
shall be of a size, color and style approved by Owner.
4. The sashes, sash doors, skylights, windows, and doors that reflect or
admit light and air into the halls, passageways or other public places in the
Building shall not be covered or obstructed, nor shall any bottles, parcels, or
other articles be placed on any window xxxxx.
5. No showcases or other articles shall be put in front of or affixed to
any part of the exterior of the Building, nor placed in the halls, corridors,
vestibules or other public parts of the Building.
6. The water and wash closets and other plumbing fixtures shall not be
used for any purposes other than those for which they were constructed, and no
sweepings, rubbish, rags, or other substances shall be thrown therein. No tenant
shall bring or keep, or permit to be brought or kept, any inflammable,
combustible or explosive fluid, material, chemical or substance in or about the
premises demised to such tenant.
7. No tenant or occupant shall xxxx, paint, drill into, or in any way
deface any part of the Building or the premises demised to such tenant or
occupant. No boring, cutting or stringing of wires shall be permitted, except
with the prior consent of Owner, and as Owner may direct. No tenant or occupant
shall install any resilient tile or similar floor covering in the premises
demised to such tenant or occupant except in a manner approved by Owner.
8. No bicycles, vehicles or animals of any kind shall be brought into or
kept in or about the premises demised to any tenant. No cooking shall be done
or permitted in the Building by any tenant without the approval of Owner. No
tenant shall cause or permit any unusual or objectionable odors to emanate from
the premises demised to such tenant.
9. No space in the Building shall be used for manufacturing, for the
storage of merchandise, or for the sale of merchandise, goods or property of any
kind at auction.
1
10. No tenant shall make, or permit to be made, any unseemly or disturbing
noises or disturb or interfere with other tenants or occupants of the Building
or neighboring buildings or premises whether by the use of any musical
instrument, radio, television set or other audio device, unmusical noise,
whistling, singing, or in any other way. Nothing shall be thrown out of any
doors or windows.
11. No additional locks or bolts of any kind shall be placed upon any of
the doors or windows, nor shall any changes be made in locks or the mechanism
thereof. Each tenant must, upon the termination of its tenancy, restore to
Owner all keys of stores, offices and toilet rooms, either furnished to, or
otherwise procured by, such tenant.
12. All removals from the Building, or the carrying in or out of the
Building or the premises demised to any tenant, of any safes, freight, furniture
or bulky matter of any description must take place at such time and in such
manner as Owner or its agents may determine, from time to time. Owner reserves
the right to inspect all freight to be brought into the Building and to exclude
from the Building all freight which violates any of the Building Rules or the
provisions of such tenant's lease.
13. No tenant shall use or occupy, or permit any portion of the premises
demised to such tenant to be used or occupied, as an office for a public
stenographer or typist, or as a xxxxxx or manicure shop, or as an employment
bureau. No tenant or occupant shall engage or pay any employees in the
Building, except those actually working for such tenant or occupant in the
Building, nor advertise for laborers, giving an address at the Building.
14. No tenant or occupant shall purchase spring water, ice, food,
beverage, lighting maintenance, cleaning, towels, or other like service, from
any company or persons not approved by Owner, such approval not unreasonably to
be withheld.
15. Owner shall have the right to prohibit any advertising mentioning the
Building or Owner by any tenant or occupant which, in Owner's opinion, tends to
impair the reputation of the Building or its desirability as a building for
offices, and upon notice from Owner, such tenant or occupant shall refrain from
or discontinue such advertising.
16. Owner reserves the right to exclude from the Building, between the
hours of 6 P.M. and 8 A.M. on business days and at all hours on Saturdays,
Sundays and holidays, all persons who do not present a pass to the Building
signed by Owner. Owner will furnish passes to persons for whom any tenant
requests such passes. Each tenant shall be responsible for all persons for whom
it requests such passes and shall be liable to Owner for all acts of such
persons.
17. Each tenant, before closing and leaving the premises demised to such
tenant at any time, shall see that all entrance doors are locked and all windows
closed.
18. Each tenant shall, at its expense, provide artificial light in the
premises demised to such tenant for Owner's agents, contractors and employees
while performing janitorial or other cleaning services and making repairs or
alterations in said premises.
19. No premises shall be used, or permitted to be used, for lodging or
sleeping or for any immoral or illegal purpose.
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20. The requirements of tenants will be attended to only upon application
at the office of Owner. Building employees shall not be required to perform,
and shall not be requested by any tenant or occupant to perform, any work
outside of their regular duties, unless under specific instructions from the
office of Owner.
21. Canvassing, soliciting and peddling in the Building are prohibited and
each tenant and occupant shall cooperate in seeking their prevention.
22. There shall not be used in the Building, either by any tenant or
occupant or by their agents or contractors, in the delivery or receipt of
merchandise, freight or other matter, any hand trucks or other means of
conveyance except those equipped with rubber tires, rubber side guards and such
other safeguards as Owner may require.
23. If the premises demised to any tenant become infested with vermin,
such tenant, at its sole cost and expense, shall cause its premises to be
exterminated, from time to time, to the satisfaction of Owner, and shall employ
such exterminators therefor as shall be approved by Owner.
24. No premises shall be used, or permitted to be used, at any time, as a
store for the sale or display of goods, wares or merchandise of any kind, or as
a restaurant, shop, booth, bootblack or other stand, or for the conduct of any
business or occupation which predominantly involves direct patronage of the
general public in the premises demised to such tenant, or for manufacturing or
for other similar purposes.
25. No tenant shall clean, or permit to be cleaned, any window of the
Building from the outside in violation of Section 202 of the New York Labor Law
or any successor law or statute, or of the rules of the Board of Standards and
Appeals or of any board or body having or asserting jurisdiction.
26. No tenant shall move, or permit to be moved, into or out of the
Building or the premises demised to such tenant, any heavy or bulky matter,
without the specific approval of Owner. If any such matter requires special
handling, only a person holding a Master Rigger's license shall be employed to
perform such special handling. No tenant shall place, or permit to be placed,
on any part of the floor or floors of the premises demised to such tenant, a
load exceeding the floor load per square foot which such floor was designed to
carry and which is allowed by law. Owner reserves the right to prescribe the
weight and position of safes and other heavy matter, which must be placed so as
to distribute the weight.
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