EXHIBIT 10.11
AGREEMENT OF SUBLEASE
between
XXXX COMMUNICATIONS, INC.
Sublandlord
and
BRONNERCOM, LLC
Subtenant
Premises:
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Entire Rentable Areas of the
2/nd/, 3/rd/, 4/th/, 5/th/, 11/th/ and 12/th/ Floors
and Portion of Basement Area
000 Xxxx Xxxxxx Xxxxx
Xxx Xxxx, Xxx Xxxx
XXXXXX XXXX LLP
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
(000) 000-0000
TABLE OF CONTENTS
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Subleasing of Premises................................................. 1
Term................................................................... 2
Fixed Rent; Additional Rent and Electricity............................ 3
Subordination to and Incorporation of the Lease........................ 9
Alterations............................................................ 11
Covenants with Respect to the Lease.................................... 12
Services and Repairs................................................... 13
Consents............................................................... 15
Termination of Lease................................................... 16
Sublease, Not Assignment............................................... 16
Damage, Destruction, Fire and other Casualty; Condemnation............. 16
No Waivers............................................................. 16
Notices................................................................ 17
Indemnity.............................................................. 17
Broker................................................................. 19
Delivery of the Premises............................................... 19
Consent of Owner to this Sublease...................................... 21
Assignment, Subletting and Mortgaging.................................. 21
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Security Deposit....................................................... 22
Insurance.............................................................. 24
Default................................................................ 24
Miscellaneous.......................................................... 25
EXHIBIT A.............................................................. 28
EXHIBIT B.............................................................. 29
EXHIBIT C.............................................................. 31
AGREEMENT OF SUBLEASE, made as of the 15/th/ day of November 1999,
between XXXX COMMUNICATIONS, INC., a New York corporation, having an office
and place of business at 000 Xxxx Xxxxxx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000
("Sublandlord") and BRONNERCOM, LLC, a Delaware limited liability company
having an office at The Prudential Tower, 000 Xxxxxxxx Xxxxxx, Xxxxxx, XX 00000
("Subtenant") .
W I T N E S S E T H :
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WHEREAS, by Agreement of Lease, dated July 17, 1992, as modified by
Agreement dated August 31, 1998 and as further modified by Extension of Term,
Additional Space and Modification Agreement dated September 18, 1998
("Modification Agreement") and as further modified by Amendment of Lease dated
November ____, 1999 (the Amendment)(the lease, as modified and amended is
collectively referred to as the "Lease") 000 Xxxx Xxxxxx Xxxxx/Xxxxxx Inc.,
predecessor-in-interest to RFR Holding, LLC. ("Owner"), as landlord, leased to
Sublandlord, as tenant certain premises consisting of the entire rentable areas
of the 2/nd/, 3/rd/, 4/th/, 5/th/, 11/th/ and 12/th/ floors and a portion of the
basement of the building known as 000 Xxxx Xxxxxx Xxxxx, Xxx Xxxx, XX (the
"Building"); and
WHEREAS, Sublandlord desires to sublease to Subtenant, and Subtenant
desires to hire from Sublandlord, the entire premises leased to Sublandlord
pursuant to the Lease (which premises are as shown on Exhibit A annexed hereto
and made a part hereof, and such premises are also as shown on various exhibits
to the Lease, being hereinafter referred to as the "Premises") on the terms and
conditions contained herein.
NOW, THEREFORE, in consideration of the mutual covenants herein
contained, it is mutually agreed as follows:
1. Subleasing of Premises. Sublandlord hereby subleases to
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Subtenant, and Subtenant hereby hires from Sublandlord, the Premises, upon and
subject to the terms and conditions hereinafter set forth.
2. Term.
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2.1. The term (the "Term") of this Sublease with respect to the
portion of the basement, and the 2/nd/, 3/rd/, 4/th/ and 5/th/ floors shall
commence (the "2 To 5
Commencement Date") on the date Sublandlord delivers exclusive possession
of the basement, 2/nd/, 3/rd/, 4/th/ and 5/th/ floors (the "2 To 5
Premises") to the Subtenant in accordance with Section 16.1 of this
Sublease. The Term with respect to the 11/th/ and 12/th/ floors shall
commence (the "11 & 12 Commencement Date") on the date Sublandlord delivers
exclusive possession of the 11/th/ and 12/th/ floors (the "11 & 12
Premises") to Subtenant in accordance with Section 16.2 of this Sublease.
The Term of this Sublease shall terminate on March 30, 2011 (the
"Expiration Date"), at 12:00 noon, or on such earlier date upon which the
Term shall expire or be canceled or terminated pursuant to any of the
conditions or covenants of this Sublease or pursuant to law. Promptly
following the 2 To 5 Commencement Date and the 11 & 12 Commencement Date,
Sublandlord and Subtenant shall enter into an agreement confirming each
such commencement date; provided, however, that failure to execute and
deliver such agreements shall not affect the validity of such commencement
dates.
3. Fixed Rent: Additional Rent and Electricity.
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3.1. 2 to 5 Premises. Subtenant shall pay to Sublandlord, commencing
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on the 2 To 5 Commencement Date and on the first day of each and every
month thereafter, in currency which at the time of payment is legal tender
for public and private debts in the United States of America, as fixed rent
during the Term, as follows:
(i) for the period commencing on the 2 To 5 Commencement Date and
ending on the day immediately preceding the fourth anniversary of the 2 To
5 Commencement Date, the sum of $3,043,388.00 per annum, payable in equal
monthly installments of $253,615.70;
(ii) for the period commencing on the fourth anniversary of the 2 To
5 Commencement Date and ending on the day immediately preceding the eighth
anniversary of the 2 To 5 Commencement Date, the sum of $3,396,316.00 per
annum, payable in equal monthly installments of $283,026.33;
(iii) for the period commencing on the eighth anniversary of the 2 To
5 Commencement Date and ending on the Expiration Date, the sum of
$3,749,244.00 per annum, payable in equal monthly installments of
$312,437.00.
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3.2. 11 & 12 Premises. In addition to the fixed rent set forth in
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Section 3.1. Subtenant shall also pay to Sublandlord, commencing on the 11
& 12 Commencement Date, the fixed rent during the term as follows:
(i) for the period commencing on the 11&12 Commencement Date and
ending on the day preceding the fourth anniversary of the 11&12
Commencement Date the sum of $1,588,176.00 per annum, payable in equal
monthly installments of $132,348.00;
(ii) for the period commencing on the fourth anniversary of the 11 &
12 Commencement Date and ending on the day immediately preceding the eighth
anniversary of the 11 & 12 Commencement Date, the sum of $1,764,640.00 per
annum, payable in equal monthly installments of $147,053.33;
(iii) for the period commencing on the eighth anniversary of the 11 &
12 Commencement Date and ending on the Expiration Date the sum of
$1,941,104.00 per annum, payable in equal monthly installments of
$161,758.67.
(The fixed rent set forth in Sections 3.2 and 3.3 shall be known
collectively as the "Fixed Rent").
3.3. (i) For each Tax Year (hereinafter defined) during the Term,
Subtenant shall pay to Sublandlord as and for additional rent an amount
(the "Sublease Tax Payment") equal to the amount by which Taxes (as defined
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in Lease) payable by Sublandlord for such Tax Year, as computed by Owner
pursuant to a Escalation Statement (as such term is defined in the Lease)
delivered to Sublandlord in accordance with the Lease, exceeds the Taxes
payable by Sublandlord for the Tax Year commencing July 1, 2000 and ending
June 30, 2001, (hereinafter referred to as the "Sublease Base Taxes").
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(ii) Within seven (7) days after receipt from Owner of a Escalation
Statement, Sublandlord shall render to Subtenant a written statement or
statements (a "Sublease Tax Statement"), together with a reproduced copy of
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the Escalation Statement received from Owner for the current or next
succeeding Tax Year (if theretofore issued by Owner), showing (i) the date
of receipt from Owner of the Escalation Statement, (ii) a comparison of the
Real Estate Taxes payable by Sublandlord for the Tax Year with the Sublease
Base Taxes and (iii) the amount of the Sublease Tax Payment resulting from
such comparison. Subtenant shall pay to Sublandlord, in twelve (12) equal
monthly installments, in advance, monthly
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together with the monthly payments of Fixed Rent due hereunder, one-twelfth (1/
12th) of the Sublease Tax Payment shown on the Sublease Tax Statement, except
that if at the time Sublandlord delivers a Sublease Tax Statement to Subtenant,
the Sublease Tax Payment shall have accrued for a period prior to the delivery
of the Sublease Tax Statement, Subtenant shall pay such accrued portion of the
Sublease Tax Payment in full on the later of fifteen (15) days after receipt of
such Sublease Tax Statement or five (5) days prior to the date same is due under
the Lease. In addition, if the aggregate amount of Sublandlord's installment
payments for Real Estate Taxes have been insufficient to discharge Sublandlord's
obligations for Real Estate Taxes then owed, then Subtenant shall pay the
additional sums required to pay such deficiency that is attributable to Sublease
Tax Payments due hereunder no later than fifteen (15) days after receipt of a
request for such additional payment from Sublandlord together with a computation
of the amount owed by Subtenant and all underlying documentation, if any,
received by Sublandlord from Owner. If Sublandlord shall be required to pay any
Real Estate Taxes on any other date or dates than as presently required by the
Lease, then the due date of the installments of the Sublease Tax Payment shall
be correspondingly accelerated or revised so that the Sublease Tax Payment (or
the applicable installment thereof) is due five (5) days prior to the date the
corresponding payment is due to Owner. Except as provided in Section 3.9 hereof,
Sublandlord`s failure to render a Sublease Tax Statement during or with
respect to any Tax Year shall not prejudice Sublandlord's right to render a
Sublease Tax Statement during or with respect to any subsequent Tax Year, and
shall not eliminate or reduce Subtenant's obligation to make Sublease Tax
Payments pursuant to this Section 3.3 for such Tax Year.
(iii) The Sublease Tax Payment shall be prorated for any partial Tax
Year in which the Term shall commence or end. If, at any time during a Tax Year,
Sublandlord receives a revised Escalation Statement from Owner, Sublandlord
shall deliver a Sublease Tax Statement to Subtenant, revised to correspond with
such revised Owner's Statement and Subtenant shall, within the later of fifteen
(15) days thereafter or five (5) days prior to the date same is due under the
Lease, pay to Sublandlord an amount equal to the amount of any underpayment of
the Sublease Tax Payment with respect to such Tax Year and, in the event of an
overpayment, Sublandlord shall either pay to Subtenant or, at Sublandlord's
election, credit against the next installments of Fixed Rent and payments of
additional rent, the amount of Subtenant's overpayment.
(iv) Only Owner shall be eligible to institute tax reduction or other
proceedings to reduce the assessed valuation of the Building. Should Owner be
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successful in any such reduction proceedings and obtain a rebate for any Tax
Year for which Subtenant has paid installments of the Sublease Tax Payment,
Sublandlord shall either pay to Subtenant, or at Sublandlord's election, credit
against the next installments of the Fixed Rent and payments of additional rent
payable under this Sublease, an amount equal to any such rebate for which
Sublandlord shall receive a credit from Owner together with a computation of the
amount owed by Subtenant and all underlying documentation, if any, received by
Sublandlord from Owner.
(v) "Tax Year" shall mean each Tax Year as set forth in the Lease.
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(vi) Provided Subtenant is not in default of this Sublease and has
received Sublandlord's prior written consent, which consent Sublandlord agrees
shall not be unreasonably withheld or delayed, if Sublandlord fails to file a
Protest under Section 3.10 of the Lease, for any tax year for which Sublandlord
is entitled to file such Protest, Subtenant shall have the right to file such
Protest on behalf of Sublandlord in accordance with the terms and conditions of
Section 3.10 of the Lease. Such Protest shall be at the sole cost and expense of
Subtenant and Subtenant shall keep Sublandlord informed of its actions and shall
not take any action which might give rise to a default under the Lease.
Sublandlord shall reasonably cooperate with Subtenant in connection with such
Protest. Subtenant shall indemnify and hold harmless Sublandlord from and
against any and all liability, fines, suits, demands, cost, and expenses of any
kind or nature, including, without limitation, reasonable attorneys' fees and
disbursements incurred in connection with, arising out of or relating to any
Protest filed by Subtenant pursuant to Section 3.10 of the Lease .
3.4. (i) For each calendar year during the Term subsequent to the
calendar year ending on December 31, 2000 (a "Lease Year"), Subtenant shall pay
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to Sublandlord an amount (the "Expense Payment") equal to of the amount by which
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Tenant's Proportionate Operating Share, as defined in the Lease, of Operating
Expenses (as such term is defined in the Lease) exceeds Tenant's Proportionate
Operating Share for calendar year 2000.
(ii) Within fifteen (15) days after receipt by Owner, Sublandlord may
furnish to Subtenant a written statement (an "Estimate Statement") setting forth
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Sublandlord's estimate of the Expense Payment for such Lease Year (the
"Estimated Payment"), which Estimate Statement shall be based upon and
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accompanied by the Escalation Statement estimating the Expense Payment for such
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Lease Year, if any, received by Sublandlord from Owner. Subtenant shall pay to
Sublandlord on the first day of each month during each Lease Year an amount
equal to one-twelfth (1/12th) of the Estimated Payment. If Sublandlord furnishes
an Estimate Statement for a Lease Year subsequent to the commencement thereof,
then (i) until the first day of the month following the month in which the
Estimate Statement is furnished to Subtenant, Subtenant shall continue to pay to
Sublandlord prior to the first day of each month an amount equal to the monthly
sum payable by Subtenant to Sublandlord with respect to the next previous Lease
Year; (ii) promptly after the Estimate Statement is furnished to Subtenant,
Sublandlord shall give notice to Subtenant stating whether the amount previously
paid by Subtenant to Sublandlord for the current Lease Year was greater or less
that the installments of the Estimated Payments to be paid for the current Lease
Year, and (a) if there shall be a deficiency, Subtenant shall pay the amount
thereof within fifteen (15) days after demand therefor, or (b) if there shall
have been an overpayment, Sublandlord shall either pay to Subtenant or, at
Sublandlord's option, credit against the next installments of the Fixed Rent and
payments of additional rent payable under this Sublease, the amount of
Subtenant's overpayment; and (iii) on the first day of the month following the
month in which the Estimate Statement is furnished to Subtenant, and monthly
thereafter throughout the remainder of the Lease Year, Subtenant shall pay to
Sublandlord an amount equal to one-twelfth (1/12th) of the Estimated Payment
shown on the most recent Estimated Statement. If and to the extent a revised
Estimate Statement is furnished by Owner to Sublandlord, Sublandlord may furnish
to Subtenant a revised Estimate Statement; if a revised Estimate Statement is
furnished to Subtenant, the Estimated Payment for such Lease Year shall be
adjusted in the same manner as provided in the preceding sentence.
(iii) At any time during or after each Lease Year, Sublandlord shall
furnish to Subtenant an annual statement or statements (the "Annual Statement")
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setting forth the items constituting the Operating Expenses during such Lease
Year, which Annual Statement shall be prepared based upon and accompanied by the
Escalation Statement or statement of Operating Expenses received by Sublandlord
from Owner. If the Annual Statement shows that the Estimated Payment (or other
payments) for such Lease Year exceeded the Expense Payment which should have
been paid for such Lease Year, Sublandlord shall either pay within fifteen (15)
days to Subtenant or, at Sublandlord's option, credit against the next
installments of Fixed Rent and payments of additional rent payable under this
Sublease, the amount of such excess; if the Annual Statement for such Lease Year
shows that the Estimated Payment for such Lease Year was less than the Expense
Payment (or other payments) which should have been paid for such Lease Year,
Subtenant shall
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pay the amount of such deficiency within fifteen (15) days after receipt of the
Annual Statement.
(iv) Each Annual Statement shall be conclusive and binding upon
Subtenant unless, within forty-five (45) days after receipt thereof, Subtenant
shall notify Sublandlord that it disputes the correctness of the Annual
Statement, specifying in reasonable detail the manner in which the Annual
Statement is claimed to be incorrect. If such notice is sent, provided Subtenant
shall pay to Sublandlord the amount shown to be due to Sublandlord on the
disputed Annual Statement, Sublandlord agrees to use commercially reasonable
efforts to enforce its rights under the Lease to dispute the correctness of the
Escalation Statement or statements of Operating Expenses delivered by Owner to
Sublandlord provided the cost of such dispute shall be paid by Subtenant as
additional rent. Subtenant agrees to indemnify and hold Sublandlord harmless
from and against any and all claims, costs, expenses and liabilities in
connection therewith, including, without limitation, reasonable attorneys` fees
and disbursements. If Owner shall revise the Escalation Statements disputed by
Subtenant, Sublandlord shall deliver to Subtenant a revised Annual Statement,
and an appropriate payment or credit by Sublandlord, or payment by Subtenant, as
the case may be made in accordance with the terms of Section 3.4(iii) hereof.
Notwithstanding the foregoing, if permitted by the Owner, Subtenant may, in its
own name or in the name of Sublandlord if required under the terms of the Lease
and at Subtenant's sole cost and expense, dispute the correctness of an
Escalation Statement pursuant to Section 3.09 of the Lease. Subtenant agrees to
keep Sublandlord fully informed of any such dispute and that its indemnity set
forth in this Section 3.4(iv) shall also cover any and all claims, costs,
expenses and liabilities incurred by Sublandlord in connection with Subtenant's
dispute of an Escalation Statement pursuant to the provisions of Section 3.09 of
the Lease.
3.5. (i) Subtenant shall pay to Sublandlord, as additional rent,
within three (3) business days after demand, (i) all payments required to be
made by Sublandlord for the supply of electric current and payable by
Sublandlord with respect to the Premises pursuant to Section 4.01 of the Lease
and Sections 2(b)(iv), 4(b) and 10(b) of the Modification Agreement, (ii) any
and all other costs, charges or expenses including, without limitation, any
interest or late charges incurred by Sublandlord as a result of Subtenant not
paying any sums hereunder to Sublandlord when the same are due and payable
hereunder, as determined under the provisions of the Lease, which are
attributable to, or incurred in connection with, Subtenant's use and occupancy
of the Premises and the provision of services and electric energy thereto.
Notwithstanding the foregoing, if permitted by Owner, Subtenant may pay
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Owner directly for the supply of electric current to the Premises provided that
Subtenant sends a copy of each electric xxxx and evidence of payment no later
than the date payment is due Landlord and further provided that Subtenant does
not default more than two (2) times in the payment for electric service.
(ii) Subtenant shall make no alterations to the electric system in the
Premises without obtaining Sublandlord's consent and complying with all
provisions of the Lease. Provided Subtenant has complied with all provisions of
the Lease (including obtaining Owner's consent, if required), Sublandlord shall
not unreasonably withhold or delay its consent to such alterations.
(iii) Sublandlord shall not be liable in any way to Subtenant for any
failure or defect in the supply or character of electric current furnished to
the Premises. Subtenant covenants and agrees that at all times its connected
electrical load shall not cause a default under the Lease nor exceed the
electrical capacity available to the Premises.
3.6. Any sums due and payable to Sublandlord under this Article 3 shall be
deemed to be, and collectible as, additional rent. If Subtenant shall fail to
timely pay when due any installment of Fixed Rent or additional rent, Subtenant
shall also pay to Sublandlord a late charge and/or interest to the extent
Sublandlord would be required to pay a late charge and/or interest to Owner
under the terms of the Lease. The payment of such late charge and interest shall
be in addition to all other rights and remedies available to Sublandlord in the
case of non-payment of Fixed Rent.
3.7. All Fixed Rent, additional rent, and all other costs, charges and
sums payable by Subtenant hereunder (collectively, "Rental"), shall constitute
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rent under this Sublease, and shall be payable to Sublandlord at its address as
set forth above, unless Sublandlord shall otherwise so direct in writing.
3.8. Subtenant shall promptly pay the Rental as and when the same shall
become due and payable without set-off, offset or deduction of any kind
whatsoever, except as expressly set forth herein, and, in the event of
Subtenant's failure to pay the same when due (subject to grace periods provided
herein), Sublandlord shall have all of the rights and remedies provided for
herein or at law or in equity, in the case of non-payment of rent.
3.9. Sublandlord's failure during the Term to prepare and deliver any
statements or bills required to be delivered to Subtenant hereunder, or
Sublandlord's
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failure to make a demand under any provisions of this Sublease shall not in any
way be deemed to be a waiver of, or cause Sublandlord to forfeit or surrender
its rights to collect any additional rent which may have become due pursuant to
this Article 3 during the Term except to the extent Owner has waived its right
to obligate Tenant to pay the corresponding amount of additional rent from
Sublandlord under Section 3.08 of the Lease. Subtenant's liability for Fixed
Rent and additional rent due under this Article 3 accruing during the Term, and
Sublandlord's obligation to refund overpayments of or adjustments to Fixed Rent
or additional rent paid to it by Subtenant, shall survive the expiration or
sooner termination of this Sublease.
3.10. Notwithstanding anything contained in this Sublease to the contrary
(i) Subtenant shall not be liable for the payment of any charges, fees or other
costs imposed by Owner on Sublandlord under the Lease unless and to the extent
related to Subtenant's occupancy of the Premises or caused by Subtenant's
actions or omissions under this Sublease, and (ii) Subtenant shall have no
obligation to make any payment to Sublandlord or Owner relating to any charges
accruing under the Lease (whether denominated as rent, rental, additional rent
or otherwise) for any period prior to the Term of this Sublease.
3.11. If either the 2 To 5 Commencement Date or 11 & 12 Commencement Date
does not occur on the first day of a calendar month, the Fixed Rent and any
Additional Rent payable hereunder shall be prorated for such partial month on
the basis of the actual number of days of such month.
3.12. Anything herein to the contrary notwithstanding, provided Subtenant
is not in default of this Sublease following any required notice and the
expiration of any applicable cure period, Subtenant shall receive an abatement
of Fixed Rent in the amount of $132,348 per month for each of the first three
(3) months following the 11 & 12 Commencement Date.
4. Subordination to and Incorporation of the Lease.
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4.1. This Sublease is in all respects subject and subordinate to the terms
and conditions of the Lease and to all matters to which the Lease is subject and
subordinate. Subtenant shall indemnify Sublandlord for, and shall hold it
harmless from and against, any and all losses, damages, penalties, liabilities,
costs and expenses, including, without limitation, reasonable attorneys' fees
and disbursements, which may be sustained or incurred by Sublandlord by reason
of
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Subtenant's failure to keep, observe or perform any of the terms, provisions,
covenants, conditions and obligations on Sublandlord's part to be kept, observed
or performed under the Lease to the extent same shall have been incorporated
herein, or otherwise arising out of or with respect to Subtenant's use and
occupancy of the Premises from and after the Commencement Date.
4.2. Except as otherwise expressly provided in, or otherwise inconsistent
with, this Sublease, or to the extent not applicable to the Premises, the terms,
provisions, covenants, stipulations, conditions, rights, obligations, remedies
and agreements contained in the Lease are incorporated in this Sublease by
reference, and are made a part hereof as if herein set forth at length, and (i)
as if the word "Lease" or "lease" or words of similar import, wherever the same
appear in the Lease, were construed to mean this "Sublease", (ii) Sublandlord
shall be substituted for all references to the "Landlord' under the Lease, (iii)
Subtenant shall be substituted for the "Tenant" under the Lease, and (iv)
Premises shall be substituted for "Demised Premises" under the Lease, except
that the following provisions of the Lease and any references to such provisions
shall be deemed deleted therefrom and shall have no force and effect as between
Sublandlord and Subtenant:
Sections 1.01, 2.01, 3.10 (second paragraph), 8.03(i),
8.04, 24.01, 25.06(a)(i) and (iii), 25.06(b), (c) and
(d), Articles 42, 44, 47.01, Schedules C, E, F, H, M,
O and P of the original lease dated July 17, 1992
between Owner and Sublandlord; Sections 2(a), 2(b)(v),
3(b) through 3(g), 4(a), 5, 6(a), (b), 7, 10(a), 11,
12(b)(i)(and any references to a specific monetary
amount), 13, 14, 15, 16, 18, 19, 20(e) of the
Modification Agreement.
4.3. If any of the express provisions of this Sublease shall conflict with
any of the provisions of the Lease incorporated by reference, such conflict
shall be resolved in every instance in favor of the express provisions of the
Sublease.
4.4. Subtenant may peaceably and quietly enjoy the Premises subject and
subordinate to the terms of this Sublease and to the terms of the Lease, to the
extent incorporated herein.
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4.5. Anything herein to the contrary notwithstanding, Sublandlord shall
have no obligation to reimburse Subtenant for any costs under Section 4.03 of
the Original Lease unless and until Sublandlord actually receives payment of
such costs from Owner pursuant to said Section 4.03. In addition, Subtenant
shall not be entitled to offset any costs or expenses under said Section 4.03
unless Sublandlord has received payment from the Owner and failed to remit such
payment to Subtenant.
4.6. Anything herein to the contrary notwithstanding, to the extent
Sublandlord shall actually receive any rent abatement under Section 9(c), (d)
and (e) of the Modification Agreement, Subtenant shall be entitled to receive a
corresponding rent abatement under this Sublease. Thus, for example, if under
Section 9(d), Subtenant receives an abatement equal to one and one-half days,
for each day after February 28, 2001 that the 11th and 12th Floors Adjustment
Date does not occur, which abatement is actually received by Sublandlord under
the terms of the Lease, Subtenant shall receive a corresponding abatement for
the same period of one and one-half days of Fixed Rent for the 11 & 12 Premises
for each day that the 11th and 12th Floors Adjustment Date has not occurred
under Section 16.2 of this Sublease. Notwithstanding the foregoing, if Owner has
given Sublandlord a notice under Section 9(f) of the Modification Agreement that
Owner intends to terminate its obligation to add the 11th and 12th Floors Added
Space to the Premises demised under the Lease, Sublandlord shall not agree to
waive the penalties (i.e., the rent abatements) under Subparagraph (c) and (d)
unless advised by Subtenant within the time required by the Modification
Agreement (in which case Subtenant shall not be entitled to any abatement
hereunder). If Subtenant fails to advise Sublandlord to waive such penalties
then, upon the effective date of Landlord's notice of termination, Sublandlord
shall have no obligation to deliver the 11 & 12 Premises to Subtenant and
Subtenant shall have no rights or obligations with respect to the 11 & 12
Premises.
5. Alterations
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5.1. Subtenant shall not make any alterations, installations,
improvements, additions or other physical changes in or about the Premises,
("Subtenant Alterations") without first obtaining the consent of Sublandlord and
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Owner with respect thereto, if (and to the extent) Sublandlord is required under
the Lease to obtain consent from Owner. Sublandlord agrees to cooperate with
Subtenant, at no cost to Sublandlord, in order to obtain consent from Owner. Any
Subtenant Alterations shall be performed by Subtenant, at Subtenant's sole cost
and expense,
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in accordance with the applicable provisions of the Lease. Sublandlord agrees
not to unreasonably withhold or delay consent with respect to any Subtenant
Alterations to the extent Owner's consent is obtained with respect thereto.
5.2 Anything herein to the contrary notwithstanding, Sublandlord's
consent shall not be required with respect to any Subtenant Alterations
(although Subtenant shall give Sublandlord not less than ten (10) days prior
written notice of such Subtenant Alterations) to the extent Subtenant
Alterations do not affect any areas outside of the Premises and do not affect
any structural portions of the Building or the Premises provided that such
Subtenant Alterations (i) shall cost less than $100,000.00 (exclusive of purely
decorative changes such as painting and carpeting) provided however, that for
purposes of this subsection, in the event that a number of discrete changes,
alterations or additions are reasonably determined to be part of a single plan
of change, alterations or additions with respect to the Premises, then the cost
of all such changes, alterations or additions shall be aggregated; (ii) shall
not interfere with or affect to any material degree any mechanical, electrical,
sanitary or utility system of the Building or of the Premises; (iii) shall
comply with all applicable provisions of the Lease, including, without
limitations, Article 6; and (iv) Owner's consent is obtained. Subtenant shall be
obligated to restore the Premises to the condition existing immediately prior to
the commencement of any Subtenant Alterations unless Sublandlord has no
corresponding obligation to restore such portion of the Premises affected by
such Subtenant Alterations under the terms of the Lease. Notwithstanding the
foregoing, Subtenant shall also remove any Specialty Alterations (as hereinafter
defined) and restore the Premises whether or not such restoration is required
under the terms of the Lease if Sublandlord advises Subtenant at any time that
Sublandlord shall be resuming occupancy of the Premises (following the occupancy
of Subtenant) and prior to the Expiration Date. If Sublandlord so advises
Subtenant then Subtenant shall also remove any Specialty Alterations and restore
the Premises as required herein. For purposes hereof, Specialty Alterations
means any Subtenant Alterations consisting of kitchens, executive bathrooms,
computer installations, vaults, internal staircases, vertical and horizontal
transportation systems, and any other alterations of a similar character; any
alterations which are inconsistent with a first class office tenant in a first
class office building in midtown Manhattan; and any Subtenant Alterations which
affect any structural portions of the Building or Premises.
5.3 Sublandlord agrees to respond to any request made by Subtenant for
approval of any Subtenant Alterations within ten (10) business days after
receipt by Sublandlord of all plans, specifications and other documentation
which are required
-12-
to be delivered to Owner under the terms of the Lease. If Sublandlord fails to
respond to Subtenant's request within said ten (10) business day period, then
Sublandlord's consent shall be deemed granted, provided that a notice
accompanying Subtenant's request for approval of Subtenant's Alterations
expressly and conspicuously advises Sublandlord that Sublandlord's failure to
respond within a ten (10) business day period shall be deemed consent under
Section 5.3 of the Sublease.
6. Covenants with Respect to the Lease.
-----------------------------------
6.1. Subtenant shall not do anything that would constitute a default under
the Lease or omit to do anything that Subtenant is obligated to do under the
terms of this Sublease so as to cause a default under the Lease.
6.2. The time limits set forth in the Lease for the giving of notices,
making demands, performance of any act, condition or covenant, or the exercise
of any right, remedy or option, are changed for the purpose of this Sublease, by
lengthening or shortening the same in each instance, as appropriate, so that
notices may be given, demands made, or any act, condition or covenant performed,
or any right, remedy or option hereunder exercised, by Sublandlord or Subtenant,
as the case may be, (and each party covenants that it will do so) within three
(3) days prior to the expiration of the time limit (unless such time period is
ten (10) days or less, in which case such three (3) day time period shall be
reduced to two (2) days), taking into account the maximum grace period, if any,
relating thereto contained in the Lease. Each party shall promptly deliver to
the other party copies of all notices, requests or demands which relate to the
Premises or the use or occupancy thereof after receipt of same from Owner.
6.3. Sublandlord represents and warrants to Subtenant that (i) Sublandlord
has a valid and subsisting leasehold estate under the Lease, (ii) the Lease is
in full force and effect, (iii) Sublandlord has not delivered or received
written notice of default under the Lease which remains uncured, (iv) to the
best of Sublandlord's knowledge, there are no defaults or state of facts with
which the giving of notice or passage of time would constitute a default of
Owner or Sublandlord thereunder, (v) attached to this Sublease as Exhibit B is a
true and complete copy of the Lease except as indicated thereon for the rental
amount and other financial portions thereof which have been redacted.
-13-
6.4. Sublandlord shall not amend or modify the Lease as the Lease may
relate to the Premises, to the detriment of Subtenant or in derogation of the
rights of Subtenant hereunder, without the prior written consent of Subtenant.
Not less than five (5) business days prior to the effective date of any such
Amendment, Sublandlord shall notify Subtenant of all amendments to the Lease and
provide to Subtenant a copy of such amendments of the Lease (with economic terms
of such amendments redacted, if so desired by Sublandlord).
6.5. Sublandlord and Subtenant represent and warrant to each other that
(i) each has the power, right and authority to make this Sublease and to perform
their respective obligations hereunder, and (ii) no petition in bankruptcy or
similar proceeding under is pending or to either party's best knowledge,
threatened against, or contemplated by, either.
6.6 Sublandlord covenants and agrees that except to the extent such
default is a consequence of or arises out of Subtenant's default under this
Sublease, Sublandlord shall not do anything that would constitute a default
under the Lease or omit to do anything that Sublandlord is obligated to do under
the terms of this Sublease so as to cause a default under the Lease. Sublandlord
shall indemnify Subtenant for and shall hold it harmless from and against any
losses, damages, penalties, liabilities, cost and expenses, including, without
limitations, reasonable attorneys fees and disbursements which, may be sustained
or incurred by Subtenant by reasons of Sublandlord's failure to comply with the
foregoing covenant.
7. Services and Repairs. Notwithstanding anything to the contrary
--------------------
contained in this Sublease or in the Lease, Subtenant shall be required to
maintain and repair the Premises in accordance with the terms of the Lease to
fulfill all of Sublandlord's obligations under the Lease with regard to the
Premises and Sublandlord shall not be required to provide any of the services
that Owner has agreed to provide, whether or not specified in the Lease (or
required by law), or furnish the electricity to the Premises that Owner has
agreed to furnish pursuant to the Lease (or required by law), or to otherwise
repair or maintain the Premises and the Personal Property (as hereinafter
defined), or make any of the repairs or restorations that Owner has agreed to
make pursuant to the Lease (or required by law), or comply with any laws or
requirements of any governmental authorities, or take any other action that
Owner has agreed to provide, furnish, make, comply with, or take, or cause to be
provided, furnished, made, complied with or taken under the Lease but Subtenant
shall have the benefit of all services, electricity, repairs, restorations, or
actions to be provided or taken by Owner thereunder and
-14-
Sublandlord agrees to use diligent efforts, at Subtenant's sole cost and
expense, to obtain the same from Owner (provided, however, that Sublandlord
shall not be obligated to use such efforts or take any action which might give
rise to a default under the Lease), and Subtenant shall rely upon, and look
solely to, Owner for the provision, furnishing or making thereof or compliance
therewith. A default by Owner under the Lease shall not excuse Subtenant's
performance under this Sublease except to the extent Sublandlord is excused from
performance under the Lease. If Owner shall default in the performance of any of
its obligations under the Lease, including its obligation to pay the
Construction Allowance under Section 12(b) of the Modification Agreement,
Sublandlord shall, upon request and at the expense of Subtenant, timely
institute and diligently prosecute any action or proceeding reasonably requested
by Subtenant in order to have Owner make such repairs, furnish such electricity,
provide such services or comply with any other obligation of Owner under the
Lease or as required by law. In addition, Subtenant shall have the right to
prosecute such action or proceeding in the name of Sublandlord, provided that
Subtenant shall keep Sublandlord informed of its actions and shall not take any
action which might give rise to a default under the Lease. Subtenant shall
indemnify and hold harmless Sublandlord from and against any and all such claims
arising from or in connection with such request, action or proceeding. This
indemnity and hold harmless agreement shall include indemnity from and against
any and all liability, fines, suits, demands, costs and expenses of any kind or
nature, including, without limitation, reasonable attorneys' fees and
disbursements, incurred in connection with any such claim, action or proceeding
brought by Sublandlord or Subtenant pursuant to this Article 7. Subtenant shall
not make any claim against Sublandlord for any damage which may arise, nor shall
Subtenant's obligations hereunder be diminished, by reason of (i) the failure of
Owner to keep, observe or perform any of its obligations pursuant to the Lease,
unless such failure is due to Sublandlord's default under this Sublease,
negligence or misconduct, or (ii) the acts or omissions of Owner, its agents,
contractors, servants, employees, invitees or licensees. The provisions of this
Article 7 shall survive the expiration or earlier termination of the Term
hereof.
8. Consents.
--------
8.1 Whenever Sublandlord has expressly agreed under the term of this
Sublease not to unreasonably withhold its consent or approval hereunder and the
consent or approval of Owner, the lessor under a superior lease, or the
mortgagee under a mortgage, as the case may be, is also required to consent
pursuant to the terms of the Lease, if Owner, the lessor under a superior lease,
or the mortgagee
-15-
under a mortgage shall withhold its consent or approval for any reason
whatsoever, Sublandlord shall not be deemed to be acting unreasonably to the
extent Sublandlord withholds its consent based upon the withholding of consent
by Owner, or such lessor or mortgagee. Sublandlord agrees that it shall promptly
after receipt thereof from Subtenant, convey all requests for the consent or
approval of Owner to Owner and Sublandlord shall use reasonable efforts
thereafter to secure such consents or approvals. If Owner shall withhold its
consent or approval in connection with this Sublease or the Premises in any
instance where, under the Lease, the consent or approval of Owner may not be
unreasonably withheld, Sublandlord, upon the request and at the expense of
Subtenant, shall either (i) timely institute and diligently prosecute any action
or proceeding which Subtenant, in its reasonable judgment, deems meritorious, in
order to dispute such action by Owner, or (ii) permit Subtenant, to the extent
allowable under the Lease, to institute and prosecute such action or proceeding
in the name of Sublandlord, provided that Subtenant shall keep Sublandlord
informed of its actions and shall not take any action which might give rise to a
default under the Lease.
8.2 If Subtenant shall request Sublandlord's consent and Sublandlord has
expressly agreed, under the terms of this Sublease, that neither its consent nor
its approval shall be unreasonably withheld, and Sublandlord shall fail or
refuse to give such consent or approval, and Subtenant shall dispute the
reasonableness of Sublandlord's refusal to give its consent or approval, such
dispute shall be finally determined by a court of competent jurisdiction or by
Arbitration under Article 38 of the Lease (except that such Arbitration shall be
conducted by a single arbitrator in accordance with the "expedited arbitration"
procedures). If the determination shall be adverse to Sublandlord, Sublandlord,
nevertheless, shall not be liable to Subtenant for a breach of Sublandlord's
covenant not to unreasonably withhold such consent or approval, and Subtenant's
sole remedy in such event shall be the granting of consent or approval by
Sublandlord with respect to such request under this Sublease. Notwithstanding
the foregoing, nothing herein shall be construed to exculpate Sublandlord from
liability based upon a final, non-appealable finding by a court of competent
jurisdiction that Sublandlord acted in bad faith in withholding such consent.
9. Termination of Lease. If the Lease is terminated by Owner pursuant to
--------------------
the terms thereof with respect to all or any portion of the Premises prior to
the Expiration Date for any reason whatsoever, including, without limitation, by
reason of casualty or condemnation, this Sublease shall thereupon terminate with
respect to any corresponding portion of the Premises, and (unless such
termination of the
-16-
Lease shall be as a result of Sublandlord's default thereunder or a voluntary
surrender of the Premises, other than a surrender of the Premises permitted
under the Lease with respect to a termination of the Lease by reason of casualty
to or condemnation of the Premises or the Building) Sublandlord shall not be
liable to Subtenant by reason thereof. In the event of such termination,
Sublandlord shall return to Subtenant that portion of the Fixed Rent and/or
additional rent paid in advance by Subtenant with respect to such portion of the
Premises, if any, prorated as of the date of such termination.
10. Sublease, Not Assignment. Notwithstanding anything contained herein,
------------------------
this Sublease shall be deemed to be a sublease of the Premises and not an
assignment, in whole or in part, of Sublandlord's interest in the Lease.
11. Damage, Destruction, Fire and other Casualty; Condemnation.
----------------------------------------------------------
Notwithstanding any contrary provision of this Sublease or the provisions of the
Lease herein incorporated by reference, Subtenant shall not have the right to
terminate this Sublease as to all or any part of the Premises, or be entitled to
an abatement of Rent, additional rent or any other item of Rental, by reason of
a casualty or condemnation affecting the Premises unless Sublandlord is entitled
to terminate the Lease or is entitled to a corresponding abatement with respect
to its corresponding obligation under the Lease. If Sublandlord is entitled to
terminate the Lease for all or any portion of the Premises by reason of casualty
or condemnation, Subtenant may terminate this Sublease as to any corresponding
part of the Premises by written notice to Sublandlord given at least five (5)
business days prior to the date(s) Sublandlord is required to give notice to
Owner of such termination under the terms of the Lease. Sublandlord agrees that
it shall not exercise any right to terminate the Lease by reason of a casualty
or condemnation without the consent of Subtenant, which consent Subtenant agrees
shall not be unreasonably withheld.
12. No Waivers. Failure by either party hereto in any instance to insist
----------
upon the strict performance of any one or more of the obligations of the other
under this Sublease, or to exercise any election herein contained, shall in no
manner be or be deemed to be a waiver by such party of any of such other party's
defaults or breaches hereunder or of any of the first party's rights and
remedies by reason of such defaults or breaches, or a waiver or relinquishment
for the future of the requirement of strict performance of any and all of such
other party's obligations hereunder. Further, no payment by Subtenant or receipt
by Sublandlord of a lesser amount than the correct amount or manner of payment
of Rental due hereunder
-17-
shall be deemed to be other than a payment on account, nor shall any endorsement
or statement on any check or any letter accompanying any check or payment be
deemed to effect or evidence an accord and satisfaction, and Sublandlord may
accept any checks or payments as made without prejudice to Sublandlord's right
to recover the balance or pursue any other remedy in this Sublease or otherwise
provided at law or equity.
13. Notices. Any notice, statement, demand, consent, approval, advice or
-------
other communication required or permitted to be given, rendered or made by
either party to the other, pursuant to this Sublease or pursuant to any
applicable law or requirement of public authority (collectively,
"Communications") shall be in writing and shall be deemed to have been properly
--------------
given, rendered or made only if sent in accordance with Section 31.01 of the
Lease addressed (i) to Subtenant at its address first above written, Attention:
Xxxxx Xxxxxxxxxx, with a copy to Xxxxx, Xxxxx Xxxx Xxxxxx Xxxxxxx and Xxxxx,
P.C., Xxx Xxxxxxxxx Xxxxxx, Xxxxxx, XX 00000, Attn: Xxxxxx X. Xxxxxx, Esq. and
(ii) to Sublandlord at its address first above written, with a copy to VNU USA,
Inc., 0000 Xxxxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attn: Xxxxxxx Xxxxxx, Chief
Financial Officer and Xxxxxx Xxxx LLP, 000 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx
00000, Attention: Xxxxxx X. Xxxxxxxx, Esq. All such communications shall be
deemed to have been given, rendered or made when delivered and receipted by the
party to whom addressed, in the case of personal delivery, or upon receipt, as
evidenced by the date of receipt noted on the return receipt, or upon the
rejection thereof, in the case of mailing. Either party may, by notice as
aforesaid actually received, designate a different address or addresses for
communications intended for it.
14. Indemnity.
---------
14.1 Subtenant shall not do or permit any act or thing to be done upon the
Premises which may subject Sublandlord to any liability or responsibility for
injury, damages to persons or property or to any liability by reason of any
violation of any requirement of law, and shall exercise such control over the
Premises as to fully protect Sublandlord against any such liability. Subtenant
shall indemnify and save harmless Sublandlord, the Parties (hereinafter defined)
and the employees, agents and contractors of any of the foregoing (collectively,
the "Indemnitees") from and against (a) all claims of whatever nature against
-----------
the Indemnitees arising from any act, omission or negligence of Subtenant, its
contractors, licensees, agents, servants, employees, invitees or visitors, (b)
all claims against the Indemnitees arising from any accident, injury or damage
whatsoever caused to any person or to
-18-
the property of any person and occurring during the Term in or about the
Premises, and (c) all claims against the Indemnitees arising from any accident,
injury or damage occurring outside of the Premises but anywhere within or about
the Building, where such accident, injury or damage results or is claimed to
have resulted from an act, omission or negligence of Subtenant or Subtenant's
contractors, licensees, agents, servants, employees, invitees or visitors. This
indemnity and hold harmless agreement shall include indemnity from and against
any and all liability, fines, suits, demands, costs and expenses of any kind or
nature (including, without limitation, attorneys' fees and disbursements)
incurred in or in connection with any such claim or proceeding brought thereon,
and the defense thereof.
14.2 Sublandlord shall indemnify and save harmless Subtenant, its
employees, agents and contractors (collectively, the "Indemnitees") from and
against all claims of whatever nature against the Indemnitees arising from any
act, omission or negligence of Sublandlord, its agents or employees. This
indemnity and hold harmless agreement shall include indemnity from and against
any and all liability, fines, suits, demands, costs and expenses of any kind or
nature (including, without limitations, attorneys fees and disbursements)
incurred in or in connection with any such claim or proceeding brought thereon
and the defense thereof.
14.3 If any claim, action or proceeding is made or brought against an
indemnified party under Sections 14.1 or 14.2, above, which claim, action or
proceeding the indemnifying party shall be obligated to indemnify the
indemnified party against pursuant to the terms of this Lease, then, upon demand
by the indemnified party, the indemnifying party at its sole cost and expense,
shall resist or defend such claim, action or proceeding in the indemnified
party's name, if necessary, by such attorneys as the indemnified party shall
approve, which approval shall not be unreasonably withheld. Attorneys for the
indemnified party's insurer are hereby deemed approved for purposes of this
Section 14.3. Notwithstanding the foregoing, the indemnified party may retain
its own attorneys to defend or assist in defending any claim, action or
proceeding involving potential liability of Fifty Thousand Dollars ($50,000) or
more, and the indemnifying party shall pay the reasonable fees and disbursements
of such attorneys. The provisions of this Article 14 shall survive the
expiration or earlier termination of the Term hereof.
-19-
15. Broker. Each party hereto covenants, warrants and represents to the
------
other party that it has had no dealings, conversations or negotiations with any
broker other than Xxxxxxx & Wakefield, Inc. ("C&W") and Insignia/ESG ("ESG")
concerning the execution and delivery of this Sublease. Each party hereto agrees
to indemnify and hold harmless the other party against and from any claims for
any brokerage commissions and all costs, expenses and liabilities in connection
therewith, including, without limitation, reasonable attorneys' fees and
disbursements, arising out of its respective representations and warranties
contained in this Article 15 being untrue. Sublandlord shall pay any brokerage
commissions due C&W and Subtenant shall pay any brokerage commission due ESG
pursuant to separate agreements between Sublandlord and C&W and Subtenant and
ESG. The provisions of this Article 15 shall survive the expiration or earlier
termination of the Term hereof.
16. Delivery of the Premises.
------------------------
16.1 Sublandlord shall deliver the 2 To 5 Premises to Subtenant in a
broom-clean condition but otherwise in its condition as exists on the date
hereof "as is" on July 1, 2000 (the "Delivery Date"), reasonable wear and tear
between the date hereof and the Delivery Date excepted. Notwithstanding the
foregoing, if Sublandlord in good faith determines that premises at 000
Xxxxxxxx, Xxx Xxxx, Xxx Xxxx, into which Sublandlord is moving upon vacating the
Premises shall not be ready for Sublandlord's occupancy on or before the
Delivery Date, then Sublandlord may, adjourn the Delivery Date for a period of
time not exceeding ninety (90) days and designated in a written notice given by
Sublandlord to Subtenant on or before twenty (20) days prior to the Delivery
Date. Sublandlord has not made and does not make any representations or
warranties as to the physical condition of the 2 To 5 Premises, the use to which
the 2 To 5 Premises may be put, or any other matter or thing affecting or
relating to the 2 To 5 Premises, except as specifically set forth in this
Sublease. Sublandlord shall have no obligations whatsoever to alter, improve,
decorate or otherwise prepare the 2 To 5 Premises for Subtenant's occupancy
except as set forth in this Sublease.
16.2 Sublandlord shall deliver the 11 & 12 Premises to Subtenant on the
11/th/ and 12/th/ Floors Adjustment Date (as defined in the Modification
Agreement) in the condition required under the Lease, subject to any
modification that may be made in Landlord's consent to this Sublease.
Sublandlord does not make any representations warranties as to the physical
conditions of the 11 & 12 Premises, the use to which the 11 & 12 Premises may be
put, or any other matter or thing
-20-
affecting or relating to the 11 & 12 Premises, except as specifically set forth
in this Sublease. Sublandlord shall have no obligation whatsoever to alter,
improve, decorate or otherwise prepare the 11 & 12 Premises for Subtenant's
occupancy except as set forth herein. Anything herein to the contrary
notwithstanding, Sublandlord shall use diligent efforts to cause Owner to
perform certain work in the 11 & 12 Premises as set forth in Section 12(a) of
the Modification Agreement, ("Owner's Work"). Subtenant agrees that Owner's Work
may be performed following the 11 & 12 Commencement Date and Subtenant shall
provide Owner with reasonable access to the 11 & 12 Premises for the purpose of
permitting Owner to perform Owner's Work provided that the performance of
Owner's Work does not unreasonably interfere with any work being performed by
Subtenant in the 11 & 12 Premises. Sublandlord agrees that Subtenant may
exercise Sublandlord's right under Section 12(a)(iv) of the Modification
Agreement to increase the tonnage of the air-conditioning units for the 11 & 12
Premises. Sublandlord agrees to promptly forward to Subtenant any notice
received by Sublandlord from Owner pursuant to said Section 12(a)(iv). If
Subtenant exercises the option set forth in said subsection to increase the
tonnage of the air-conditioning units, any cost and expenses which Sublandlord
is required to pay to Owner shall be payable on demand by Subtenant to
Sublandlord as additional rent hereunder.
16.3 So long as Subtenant shall not be in default of this Sublease after
the giving of any required notice and the expiration of any applicable cure
period, Sublandlord agrees to reimburse Subtenant in an amount (the
"Construction Allowance") equal to the lesser of: (i) $661,740.00 or (ii) the
cost incurred by Subtenant for any leasehold improvements or other construction
work to the 11 & 12 Premises, but only to the extent such improvements or other
construction work is reimbursable to Sublandlord by Owner pursuant to the term
of the Modification Agreement. The parties hereto agree that the Construction
Allowance shall be paid in accordance with the terms and conditions of Section
12(b) of the Modification Agreement, and Sublandlord shall have no obligation to
reimburse Subtenant for any portion of the Construction Allowance until and
unless Sublandlord has received from Owner the corresponding payment pursuant to
said Section 12(b) of the Modification Agreement. Subtenant agrees that in order
for it to be reimbursed for the Construction Allowance, it must submit to
Sublandlord the documentation, statements, lien waivers and other information
required to be submitted to Owner under Section 12(b) of the Modification
Agreement and failure to provide such documentation or comply with the terms of
said Section 12(b) shall result in a denial of payment of the Construction
Allowance to Subtenant. The Sublandlord agrees that promptly upon receipt of
such documentation as required by the Modification
-21-
Agreement, it shall promptly submit the same to Owner and request reimbursement
in accordance with the terms and conditions of the Modification Agreement.
However, Sublandlord shall only be acting as a conduit for such payments from
the Owner and other than using diligent efforts (at Subtenant's sole cost and
expense to obtain reimbursement for the Construction Allowance from Owner)
Subtenant shall rely upon and look solely to Owner for the payment of the
Construction Allowance and Sublandlord shall have no liability with respect to
thereto.
17. Consent of Owner to this Sublease.
---------------------------------
17.1 Subtenant hereby acknowledges and agrees that this Sublease is
subject to and conditioned upon Sublandlord obtaining ^^^ consent (the
"Consent") of Owner (which shall include the consent ^^^ sublease and the
-------
Amendment by the holder of the mortgage on the Building) sub ^^^ ly in the form
annexed hereto as Exhibit C. Promptly following the execu ^^^ and delivery
hereof, Sublandlord shall submit this Sublease to Owner. ^^^^^^^^^^^^^^^^ agrees
that it shall cooperate in good faith with Sublandlord and shall comply with any
reasonable requests made of Subtenant by Sublandlord or Owner in the procurement
of the Consent. Sublandlord shall use reasonable efforts to obtain Owner's
consent provided that in no event shall Sublandlord be obligated to make any
payment to Owner in order to obtain the Consent or the consent to any provision
hereof, other than as expressly set forth in the Lease.
17.2 If Owner shall not have executed and delivered the Consent on or
before forty-five (45) days from the date hereof, either party shall have the
right to cancel this Sublease on fifteen (15) days written notice to the other
(the "Cancellation Notice") and with the giving of such notice, this Sublease
shall be deemed canceled and no further force or effect and neither party shall
have any liability or obligation to the other in respect thereof.
Notwithstanding the foregoing, if within fifteen (15) days after the giving of
the Cancellation Notice, the Consent by Owner is received, then the Cancellation
Notice shall be deemed null and void and the Sublease shall continue in full
force and effect.
18. Assignment, Subletting and Mortgaging.
-------------------------------------
18.1 Subtenant shall not assign, sell, transfer (whether by operation or
law or otherwise), pledge, mortgage or otherwise encumber this Sublease or any
portion of its interest in the Premises, nor sublet all or any portion of the
Premises or permit any other person or entity to use or occupy all or any
portion of the
-22-
Premises, without the prior written consent of Sublandlord and Owner and with
compliance of all terms of the Lease. Notwithstanding the foregoing, provided
the consent of the Owner is obtained and Subtenant has complied with all terms
of the Lease, Sublandlord agrees not to unreasonably withhold or delay consent
to an assignment of this Sublease or a further sublet of the Premises. Anything
herein to the contrary notwithstanding, provided Subtenant has obtained the
prior written consent of Owner, Subtenant may enter into one (1) sub-sublease
for a portion of the Premises without Sublandlord's consent provided all of the
following conditions are satisfied: (i) Sublandlord shall be given a copy of the
sub-sublease no later than ten (10) days prior to the effective date of its
term, (ii) the premises to be sublet shall be commercially regular in shape and
shall not be less than 10,000 rentable square feet and no more than the entire
rentable area of a floor of the Premises, (iii) such sub-sublease contains a
term not in excess of five (5) years and is executed and unconditionally
delivered no later than one (1) year from the date hereof and (iv) such sub-
sublease shall comply with and shall be subject to all terms and conditions of
the Lease.
18.2 If this Sublease be assigned, or if the Premises or any part thereof
be sublet (whether or not Sublandlord and Owner shall have consented thereto),
Sublandlord, after default by Subtenant in its obligations hereunder, may
collect rent from the assignee or subtenant and apply the net amount collected
to the Rental herein reserved, but no such assignment or subletting shall be
deemed a waiver of the covenant set forth in this Article 18, or the acceptance
of the assignee or subtenant as a tenant, or a release of Subtenant from the
further performance and observance by Subtenant of the covenants, obligations
and agreements on the part of Subtenant to be performed or observed herein. The
consent by Sublandlord or Owner to an assignment, sale, pledge, transfer,
mortgage or subletting shall not in any way be construed to relieve Subtenant
from obtaining the express consent in writing, to the extent required by this
Sublease or the Lease, of Sublandlord and Owner to any further assignment, sale,
pledge, transfer, mortgage or subletting.
19. Security Deposit.
----------------
19.1 Subtenant shall deposit with Sublandlord on the signing of this
Sublease the sum of Five Million Ninety-Eight Thousand Five Hundred Seventy-Two
Dollars and 44/100 ($5,098,572.00), or at Subtenant's option, a "clean,"
unconditional, irrevocable and transferable letter of credit (the "Letter of
---------
Credit") in the same amount, reasonably satisfactory to Sublandlord, issued by
------
and drawn on a bank reasonably satisfactory to Sublandlord with an office in and
which
-23-
regularly conducts business in the City of New York or is a member of the New
York Clearing House Association, for the account of Sublandlord, for a term of
not less than one (1) year, as security for the faithful performance and
observance by Subtenant of the terms, covenants, conditions and provisions of
this Sublease, including, without limitation, the surrender of possession of the
Premises to Sublandlord as herein provided. If a default shall occur and be
continuing beyond any applicable cure period, Sublandlord may apply the whole or
any part of the security so deposited, or present the Letter of Credit for
payment and apply the whole or any part of the proceeds thereof, as the case may
be, to the extent required for the payment of any or all of the following: (i)
the payment of Rental as to which Subtenant is in default, (ii) any sum which
Sublandlord may expend or be required to expend by reason of Subtenant's default
in respect of any of the terms, covenants and conditions of this Sublease,
including, without limitation, any damage, liability or expense (including,
without limitation, reasonable attorneys' fees and disbursements) incurred or
suffered by Sublandlord, and (iii) any damage or deficiency incurred or suffered
by Sublandlord in the reletting of the Premises, whether such damages or
deficiency accrue or accrues before or after summary proceedings or other re-
entry by Sublandlord. If Sublandlord applies or retains any part of the proceeds
of the Letter of Credit or the security so deposited, as the case may be,
Subtenant, within five (5) days after demand, shall deposit with Sublandlord the
amount so applied or retained so that Sublandlord shall have the full deposit on
hand at all times during the Term. If Subtenant shall fully and faithfully
comply with all of the terms, provisions, covenants and conditions of this
Sublease, the Letter of Credit or the security (together with all interest
earned thereon), as the case may be, shall be returned to Subtenant after the
Expiration Date and after delivery of possession of the Premises to Sublandlord
in the condition required by this Sublease. Subtenant shall not assign or
encumber or attempt to assign or encumber the monies deposited herein as
security and neither Sublandlord nor its successors or assigns shall be bound by
any such assignment, encumbrance, attempted assignment or attempted encumbrance.
Subtenant shall renew any Letter of Credit from time to time, at least thirty
(30) days prior to the expiration thereof, and deliver to Sublandlord a new
Letter of Credit or an endorsement to the Letter of Credit, and any other
evidence required by Sublandlord that the Letter of Credit has been renewed for
a period of at least one (1) year. If Subtenant shall fail to renew the Letter
of Credit as aforesaid, Sublandlord may present the Letter of Credit for payment
and retain the proceeds thereof as security in lieu of the Letter of Credit. If
Subtenant does not deliver a Letter of Credit then the security deposited by
Subtenant with Sublandlord will be held in an interest bearing account
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and the party entitled to the security will also be entitled to the interest
earned thereon.
19.2 Anything herein to the contrary notwithstanding, provided Subtenant
is not in default of any term, covenant or condition of this Sublease, subject
to Subtenant's satisfaction of the Net Worth requirements (as hereinafter
defined), [x] on the fifth (5th) anniversary of the 11 & 12 Commencement Date,
the amount of the Letter of Credit may be reduced to the amount of $3,440,637.00
and [y] on the sixth (6/th/) anniversary of the 11 & 12 Commencement Date, the
Letter of Credit may be reduced to $2,845,174.00. For purposes hereof, Subtenant
shall be deemed to have satisfied the Net Worth requirements if Subtenant's Net
Worth determined in accordance with generally accepted accounting principles and
as reflected on Subtenant's audited financial statement for the most recently
ended fiscal period of one year, Subtenant's Net Worth, as submitted to
Sublandlord, is equal to or greater than the Net Worth of Subtenant on the date
of the Sublease. Anything herein to the contrary notwithstanding, Subtenant
shall not be permitted to reduce the amount of the Letter of Credit as set forth
herein, if Subtenant at any time fails to actually occupy at least 88,232
rentable square feet of the Premises.
20. Insurance. During the term of this Sublease, Subtenant, at its sole
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cost and expense, shall provide and maintain insurance in conformity with the
provisions of Article 9 of the Lease applicable to the Premises. Subtenant shall
cause Sublandlord, Owner, any other party which Owner may request under the
Lease to be included as additional named insureds in said policy or policies
which shall contain provisions, that it or they will not be cancelable except
upon not less than thirty (30) days' prior written notice to all insureds and
that the act or omission of one insured will not invalidate the policy as to the
other insureds. Subtenant shall furnish to Sublandlord a certificate or
certificates of insurance or other reasonable satisfactory evidence confirming
that such insurance is in effect at or before the Commencement Date and, on
request, at reasonable intervals thereafter.
21. Default. In the event Subtenant defaults in the performance of any of
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the terms, covenants and conditions of this Sublease beyond any required notice
and applicable grace period set forth herein or in the Lease, Sublandlord shall
be entitled to exercise any and all of the rights and remedies to which it is
entitled by law and also any and all of the rights and remedies specifically
provided for in the Lease, which are hereby incorporated herein and made a part
hereof with the same force and effect as if herein specifically set forth in
full, and that wherever in the
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Lease rights and remedies are given to the Owner, the same shall be deemed given
to Sublandlord.
22. Miscellaneous.
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22.1 This Sublease contains the entire agreement between the parties and
all prior negotiations and agreements are merged in this Sublease. Any agreement
hereafter made shall be ineffective to change, modify or discharge this Sublease
in whole or in part unless such agreement is in writing and signed by the
parties hereto. No provision of this Sublease shall be deemed to have been
waived by Sublandlord or Subtenant unless such waiver be in writing and signed
by Sublandlord or Subtenant, as the case may be. The covenants and agreements
contained in this Sublease shall bind and inure to the benefit of Sublandlord
and Subtenant and their respective permitted successors and assigns.
22.2 In the event that any provision of this Sublease shall be held to be
invalid or unenforceable in any respect, the validity, legality or
enforceability of the remaining provisions of this Sublease shall be unaffected
thereby.
22.3 The paragraph headings appearing herein are for purposes of
convenience only and are not deemed to be a part of this Sublease.
22.4 Capitalized terms used herein shall have the same meanings as are
ascribed to them in the Lease, unless otherwise expressly defined herein.
22.5 This Sublease is offered to Subtenant for signature with the express
understanding and agreement that this Sublease shall not be binding upon either
party unless and until both parties shall have executed and Sublandlord has
delivered a fully executed copy of this Sublease to Subtenant.
22.6 Neither the partners comprising Sublandlord (if Sublandlord is a
partnership), nor the shareholders, partners, directors or officers of
Sublandlord or any of the foregoing (collectively, the "Parties") shall be
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liable for the performance of Sublandlord's obligations under this Sublease.
Subtenant shall look solely to Sublandlord to enforce Sublandlord's obligations
hereunder and shall not seek damages against any of the Parties. Subtenant shall
look only to the assets of Sublandlord for the satisfaction of Subtenant's
remedies for the collection of a judgment (or other judicial process) requiring
the payment of money by Sublandlord in the event of any default by Sublandlord
hereunder, and no property or assets of
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the Parties shall be subject to levy, execution or other enforcement procedure
for the satisfaction of Subtenant's remedies under or with respect to this
Sublease, the relationship of Sublandlord and Subtenant hereunder or Subtenant's
use or occupancy of the Premises.
22.7 Neither the partners comprising Subtenant (if Subtenant is a
partnership), nor the shareholders, partners, directors or officers of Subtenant
or any of the foregoing (collectively, the "Parties") shall be liable for the
-------
performance of Subtenant's obligations under this Sublease. Sublandlord shall
look solely to Subtenant to enforce any of Subtenant's obligations hereunder and
shall not seek damages against any of the Parties. Sublandlord shall look only
to the assets of Subtenant for the satisfaction of Sublandlord's remedies for
the collection of a judgment (or other judicial process) requiring the payment
of money by Subtenant in the event of any default by Subtenant hereunder, and no
property or assets of the Parties shall be subject to levy, execution or other
enforcement procedure for the satisfaction of Sublandlord's remedies under or
with respect to this Sublease, the relationship of Subtenant and Sublandlord
hereunder or Sublandlord's use or occupancy of the Premises.
22.8 This Sublease shall be governed by, and construed in accordance with,
the laws of the State of New York.
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IN WITNESS WHEREOF, the parties hereto have duly executed
this Agreement of Sublease as of the day and year first above written.
XXXX COMMUNICATIONS, INC.,
Sublandlord
By: /s/ Xxxxxx Xxxxx
-----------------------------
Name: Xxxxxx Xxxxx
Title: CFO
BRONNERCOM, LLC,
Subtenant
By: /s/ Xxxxx Xxxxx
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Name: Xxxxx Xxxxx
Title: CEO
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