LEASE
between
MASSACHUSETTS MUTUAL LIFE INSURANCE COMPANY,
Landlord
and
SFX ENTERTAINMENT, INC.,
Tenant
March 13, 2000
PREMISES:
Xxxxxxx Tower
000 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
TABLE OF CONTENTS
Page:
ARTICLE 1 Term and Fixed Rent.............................................1
ARTICLE 2 Delivery and Use of Premises....................................7
ARTICLE 3 Operating Expenses and Real Estate Taxes.......................19
ARTICLE 4 Security.......................................................34
ARTICLE 5 Subordination, Notice to Superior Lessors and Mortgagees.......38
ARTICLE 6 Quiet Enjoyment................................................41
ARTICLE 7 Assignment, Subletting and Mortgaging..........................42
ARTICLE 8 Compliance with Laws...........................................58
ARTICLE 9 Insurance......................................................60
ARTICLE 10 Intentionally Omitted..........................................64
ARTICLE 11 Alterations....................................................64
ARTICLE 12 Landlord's and Tenant's Property...............................74
ARTICLE 13 Repairs and Maintenance........................................78
ARTICLE 14 Electricity....................................................81
ARTICLE 15 Building Management and Services...............................83
ARTICLE 16 Access.........................................................91
ARTICLE 17 Notice of Occurrences..........................................93
ARTICLE 18 Non-Liability and Indemnification..............................93
ARTICLE 19 Damage or Destruction..........................................95
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ARTICLE 20 Eminent Domain...................................................99
ARTICLE 21 Surrender.......................................................101
ARTICLE 22 Conditions of Limitation........................................101
ARTICLE 23 Reentry by Landlord.............................................105
ARTICLE 24 Damages.........................................................106
ARTICLE 25 Affirmative Waivers.............................................108
ARTICLE 26 No Waivers......................................................109
ARTICLE 27 Curing Tenant's Defaults........................................110
ARTICLE 28 Broker..........................................................111
ARTICLE 29 Notices.........................................................112
ARTICLE 30 Estoppel Certificates...........................................115
ARTICLE 31 Memorandum of Lease.............................................116
ARTICLE 32 No Representations by Landlord..................................116
ARTICLE 33 Roof Rights.....................................................116
ARTICLE 34 Holdover........................................................120
ARTICLE 35 Miscellaneous Provisions and Definitions........................122
ARTICLE 36 Partnership Tenant..............................................132
ARTICLE 37 Industrial and Commercial Incentive Program.....................133
ARTICLE 38 Layout and Finish...............................................136
ARTICLE 39 First Extension of Term.........................................140
ARTICLE 40 Second Extension of Term........................................144
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ARTICLE 41 Historic Tax Credits............................................147
ARTICLE 42 Building Surface Signage and Advertising Rights.................152
ARTICLE 43 Building Name...................................................157
ARTICLE 44 Right of First Offer on Certain Dispositions of Real Property...157
ARTICLE 45 Leasehold Financing.............................................161
ARTICLE 46 Collateral Assignment of Subleases and Subrents.................167
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EXHIBITS
Exhibit A: Description of Land
Exhibit B: Floor Plans
Exhibit B-1: Floor Plan - Building Management Office
Exhibit B-2: Rental Square Footage of Premises
Exhibit C: Building Work
Exhibit D: Minimum SNDA Rents
Exhibit E: Alterations Rules and Regulations
Exhibit F: Operating Budget
Exhibit G-1: Form of Letter of Credit
Exhibit G-2: BONY Form of Letter of Credit
Exhibit H-1: Form of Superior Mortgagee Nondisturbance Agreement
Exhibit H-2: Form of Superior Lessor Nondisturbance Agreement
Exhibit I: Form of Subtenant Nondisturbance Agreement
Exhibit J: Intentionally Omitted
Exhibit K: Form of Assumption of Lease
Exhibit L: Contract of Sale
Exhibit M: Initial Management Agreement
Exhibit N-1: Initial Cleaning Specification
Exhibit N-2: Minimum Cleaning Specification
Exhibit O: Memorandum of Lease
Exhibit P: Form of Commencement Date Agreement
Exhibit Q: Landlord's Initial Wire Transfer Instructions
Exhibit R-1: Form of Collateral Assignment of Subleases and Subrents
Exhibit R-2: Form of Intercreditor Agreement
Exhibit S: ICIP Certificate of Eligibility
Exhibit T: Form of Lien Waiver
Exhibit U: Additional Tenant Work
Exhibit V: Landlord's Entrance and Lobby Signage Plans
Exhibit W: Confirmation of Waiver of Rights of First Offer
Exhibit X: Form of Guaranty of Lease for Affiliate Transactions
Exhibit Y: Example of Sublease Profit Calculation
Exhibit Z: Landlord's Architect's Certificate
Exhibit AA: Section 37.04 Arbitration Procedures
Exhibit BB: Specific Items of Work to be Substantially Completed as
Condition to Substantial Completion of Pre-Commencement
Work
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INDEX OF DEFINED TERMS
3-Floor Retail Sublease......................................................154
AAA...........................................................................30
Acceptable Insurance Companies................................................61
Acceptance Deliveries........................................................159
Additional Charges.............................................................3
Additional Prohibited SNDA Uses...............................................54
Additional Tenant Work.....................................................7,139
Additional Tenant Work Allowance.............................................139
Affiliate....................................................................161
Alterations...................................................................64
and/or.......................................................................126
Antenna Areas................................................................116
Antennas.....................................................................116
Anticipated Completion Date...................................................98
Applicable Areas..............................................................53
Arbiter.......................................................................30
Article 41 Abatement Amount..................................................151
Assignment Profit.............................................................49
Base Net Worth................................................................44
Base Rate....................................................................126
Below-Grade Premises...........................................................1
Broker.......................................................................111
Building.......................................................................1
Building Office................................................................1
Building Systems..............................................................22
Building Work..................................................................7
Building Work Future Compliance Costs.........................................58
Business Days................................................................127
Commencement Date..............................................................4
Compliance Expenditures.......................................................20
Construction Costs...........................................................138
Consumer Price Index.........................................................126
Contract of Sale.............................................................158
control.......................................................................44
Converted Floor(s.............................................................54
Cornerstone...................................................................84
Cost Savings Expenditures.....................................................20
CPI-AUC......................................................................126
Date of the Taking............................................................99
Deemed Approval Notice........................................................48
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Direct Meters.................................................................82
Direct Sublease Space.........................................................55
Direct Tenant Termination Notice..............................................86
Entity Sale..................................................................158
Estimated Tax Credit Loss................................................149,150
Expedited Arbitration..........................................................8
Expiration Date................................................................2
Facade.......................................................................153
final plan...................................................................136
First Determination Date.....................................................140
First Extension Expiration Date..............................................140
First Extension Notice.......................................................140
First Extension Term.........................................................140
First Extension Term Commencement Date.......................................140
First Rent Notice............................................................140
Fixed Rent...................................................................2,4
Force Majeure Causes.........................................................123
GAAP..........................................................................20
Ground Lease.................................................................157
Hazardous Materials..........................................................131
herein.......................................................................125
hereunder....................................................................125
Historic Tax Credits.........................................................116
holder of a mortgage.........................................................125
Holdover Percentage..........................................................121
HVAC..........................................................................67
HVAC List......................................................................9
ICIP Program.................................................................133
Incremental Insurance Costs...................................................63
Industrial and Commercial Incentive Program..................................133
Initial Alterations Request...................................................64
Initial Cleaning Specification................................................89
Initial Contractors Request...................................................71
Initial Management Agreement..................................................83
Insured Losses................................................................62
Interest Rate................................................................126
Land...........................................................................1
Landlord...................................................................1,125
Landlord Delay................................................................11
Landlord shall have no liability to Tenant...................................126
Landlord Tax Credit Fault....................................................150
Landlord's Additional Tax Advisor.............................................26
Landlord's Architect's Certificate...........................................5,9
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Landlord's Casualty Termination Notice........................................97
Landlord's Initial ICIP Application..........................................134
Landlord's Offer.............................................................158
Landlord's Restoration Work................................................95,97
Landlord's Submitted Value...................................................141
Latent Defect List.............................................................9
Lease..........................................................................1
Legal Requirements...........................................................125
LLC...........................................................................42
Major Subcontractor..........................................................138
Major Sublease Period.........................................................50
Major Subleases...............................................................50
Management Agreement..........................................................83
Manager.......................................................................83
Manager Termination Notice....................................................86
Material Alteration...........................................................66
Meter Four....................................................................82
Meter One.....................................................................82
Meter Three...................................................................82
Meter Two.....................................................................82
Minimum ICIP Expenses........................................................134
Minimum Retail Credit Rating..................................................58
Minimum SNDA Rent.......................................................52,53,56
Modified Plan................................................................136
mortgage.....................................................................125
mortgagee....................................................................125
Non-Material Alteration.......................................................67
Non-Material Alterations......................................................66
Non-Notifying Party..........................................................127
Non-Performance Notice........................................................85
Non-Standard Office Items.....................................................74
notices......................................................................112
NPS..........................................................................148
NPS Amendment Filing.........................................................148
Offer........................................................................158
Offeror......................................................................158
Office Floor...................................................................1
Office Premises................................................................1
Offset Notice.................................................................13
Operating Expense Abatement Period............................................28
Operating Expenses............................................................19
Operating Payment.............................................................28
Operating Statement...........................................................19
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Operating Year................................................................23
Outright Sale................................................................157
Outside Billing Date..........................................................32
Partial Approval Notice.......................................................65
Penalty Date..................................................................10
Permitted Ancillary Uses......................................................16
Permitted Retail Elevators....................................................76
Permitted Retail Staircase....................................................76
Permitted SNDA Restaurant/Bar Use.............................................55
person.......................................................................126
Post-Commencement Building Work Self-Help Notice..............................14
Post-Commencement Substantial Completion Notice................................9
Pre-Approved Engineers........................................................68
Premises.......................................................................1
Project......................................................................133
Projected Completion Date.....................................................14
Punchlist......................................................................9
Punchlist Self-Help Notice....................................................13
Real Property.................................................................23
Records.......................................................................29
Relocated Building Office......................................................1
Remedy Work..................................................................124
Reminder Notice...............................................................32
Removal Items.................................................................76
Removal Notice................................................................74
Rent Commencement Date.........................................................5
requirements of insurance bodies.............................................125
Restoration Completion Date...................................................97
Retail Premises................................................................1
Retail Rent Shortfall.........................................................57
Retail Sublease Delay........................................................151
Second Alterations Request....................................................64
Second Contractors Request....................................................71
Second Determination Date....................................................145
Second Extension Expiration Date.............................................144
Second Extension Notice......................................................144
Second Extension Term........................................................144
Second Extension Term Commencement Date......................................144
Second Rent Notice...........................................................145
Section 13.03 Self Help Notice................................................80
Section 13.06 Dispute Notice..................................................81
Section 13.06 Self-Help Notice................................................80
Section 2.01(j) Dispute Notice................................................14
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Section 201(i) Dispute Notice.................................................13
Section 3.02 Notice...........................................................26
Section 3.06 Default Notice...................................................33
Section 3.06 Offset Notice....................................................33
Section 3.07 Offset Notice"...................................................33
Section 39.04 Period.........................................................142
Section 7.02 Transactions.....................................................42
Security Letter...............................................................35
Self-Help Costs...............................................................13
Settlement Amount.............................................................27
Sign Agreement...............................................................153
Sign User....................................................................153
Signage Delay................................................................151
Signage Delay Period.........................................................152
Signage Lines................................................................154
Signs........................................................................153
SNDA..........................................................................40
SNDA Follow-up................................................................41
SNDA Request..................................................................41
Standard Insurance Requirements...............................................18
Sublease Back................................................................154
Sublease Back Space...........................................................55
Sublease Profit...............................................................50
Substantial Completion Dispute Notice..........................................8
Substantial Completion Notice..................................................5
Subtenant SNDA............................................................53, 56
Successor Landlord............................................................39
Superior Lease................................................................38
Superior Lessor...............................................................38
Superior Mortgage.............................................................38
Superior Mortgagee............................................................38
System Distribution Alterations...............................................67
Tax Due Date..................................................................24
Tax Payment...................................................................24
Tax Representative............................................................26
Tax Year......................................................................24
Taxes.........................................................................23
Tenant....................................................................1, 125
Tenant Delay..................................................................12
Tenant Force Majeure Causes...............................................60, 79
Tenant Occupancy Delay.......................................................151
Tenant Requisition...........................................................138
Tenant's Affiliates...........................................................42
Tenant's Cost.................................................................51
Tenant's Costs................................................................50
Tenant's Property.............................................................77
Tenant's Statement............................................................30
Tenant's Submitted Value.....................................................141
Tenant's Work............................................................68, 137
Tenant-Controlled Tax Year....................................................25
Termination Date..............................................................11
the same shall be without liability to Landlord..............................126
the term hereof.........................................................144, 146
the term of this Lease..................................................144, 146
Untenantability Conditions...................................................123
Untenantability Termination Notice...........................................124
Untenantability Termination Period......................................123, 124
Wiring.......................................................................117
without incurring any liability to Tenant therefor...........................126
Work Allowance...............................................................138
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LEASE (herein called this "Lease"), dated March 13, 2000,
between MASSACHUSETTS MUTUAL LIFE INSURANCE COMPANY, a Massachusetts
corporation, having an office at c/o Cornerstone Real Estate Advisers, Inc., Xxx
Xxxxxxxxx Xxxxx Xxxxx 0000, Xxxxxxxx, Xxxxxxxxxxx 00000-0000 (herein called
"Landlord") and SFX ENTERTAINMENT, INC., a Delaware corporation, having an
office at 000 Xxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000 (herein called "Tenant").
Landlord and Tenant do hereby covenant and agree as follows:
ARTICLE I
Term and Fixed Rent
1.01. Landlord hereby leases to Tenant, and Tenant hereby
hires from Landlord, upon and subject to the terms, covenants, provisions and
conditions of this Lease, the premises described in Section 1.02 hereof.
1.02. The premises (herein called the "Premises") leased to
Tenant consist of (i) the land (herein called the "Land") described in Exhibit A
annexed hereto, and (ii) the entire building located on the Land (herein called
the "Building") known as Xxxxxxx Tower, 000 Xxxx 00xx Xxxxxx xx xxx Xxxx, Xxxxxx
and State of New York. The interior space within the Premises and located on
Floors two (2) through five (5) of the Building and the portion of the first
(1st) floor of the Building designated as retail space on the floor plans
attached hereto as Exhibit B are sometimes referred to herein collectively as
the "Retail Premises." The interior space within the Premises and located on
Floors six (6) through twenty-four (24) of the Building are sometimes referred
to herein individually as an "Office Floor" and collectively as the "Office
Premises." In the event Tenant converts the use of the fifth (5th) floor or both
the fourth (4th) and fifth (5th) floors of the Building from retail use to
office use pursuant to Section 2.02(d) hereof, from and after any such
conversion the floor(s) so converted shall be deemed "Office Floor(s)" and part
of the "Office Premises" for purposes of this Lease. The Premises also include
all of the subcellar and the cellar of the Building (herein collectively called
the "Below-Grade Premises"), provided, however, that the portion of the cellar
of the Building substantially as shown on the floor plan annexed hereto as
Exhibit B-1 shall be reserved for use throughout the term of this Lease by
Landlord and/or the Manager (as such term is defined in Section 15.01 hereof)
for use solely as an office for the management of the Building (herein called
the "Building Office"). Notwithstanding the foregoing, from time to time during
the term of this Lease upon not less than sixty (60) days prior written notice
to Landlord by Tenant, Landlord agrees to relocate the Building Office to
another portion of the Building designated by Tenant in such notice (herein
called a "Relocated Building Office"), provided that (i) Landlord shall not be
required to effect
such a relocation more than once in any 12-month period, (ii) any Relocated
Building Office shall be no smaller than 500 useable square feet and shall be
substantially similar in finish to the existing office and receive substantially
similar HVAC service, (iii) all reasonable out-of-pocket costs and expenses
incurred by Landlord and/or the Manager in constructing and finishing any
Relocated Building Office to substantially the same standard as the previously
occupied Building Office and relocating furniture, fixtures and equipment
thereto shall be reimbursed by Tenant as Additional Charges within twenty (20)
days after delivery to Tenant of an invoice therefor, which invoice shall be
accompanied by copies of the bills for such costs and expenses. There shall be
no Fixed Rent (as such term is defined in Section 1.04 hereof) allocated to the
Below-Grade Premises. The number of rentable square feet contained within the
Retail Premises and on each Office Floor are set forth on Exhibit B-2, attached
hereto.
1.03. The term of this Lease (a) shall commence on the
Commencement Date (as such term is defined in Section 1.05 hereof) and (b)
shall end at 11:59 p.m. on the date (herein called the "Expiration Date") that
is the last day of the month in which the twentieth (20th) anniversary of the
day preceding the Rent Commencement Date (as such term is defined in Section
1.05 hereof) occurs, or on such earlier date upon which the term of this Lease
shall expire or be canceled or terminated pursuant to any of the conditions or
covenants of this Lease or pursuant to law.
1.04. The rents shall be and consist of:
A. With respect to the Retail Premises:
(i) fixed rent (herein called "Fixed Rent") at the rate
of:
(w) FIVE MILLION THREE HUNDRED THOUSAND AND
00/100 ($5,300,000.00) DOLLARS per annum,
for the period commencing on the Rent
Commencement Date (as such term is defined
in Section 1.05 hereof) and ending on the
day immediately preceding the fifth (5th)
anniversary of the Rent Commencement Date;
(x) FIVE MILLION NINE HUNDRED NINE THOUSAND FIVE
HUNDRED AND 00/100 ($5,909,500.00) DOLLARS
per annum, for the period commencing on the
fifth (5th) anniversary of the Rent
Commencement Date and ending on the day
immediately preceding the tenth (10th)
anniversary of the Rent Commencement Date;
2
(y) SIX MILLION FIVE HUNDRED EIGHTY-NINE
THOUSAND NINETY-TWO AND 50/100
($6,589,092.50) DOLLARS per annum, for the
period commencing on the tenth (10th)
anniversary of the Rent Commencement Date
and ending on the day immediately preceding
the fifteenth (15th) anniversary of the Rent
Commencement Date; and
(z) SEVEN MILLION THREE HUNDRED FORTY-SIX
THOUSAND EIGHT HUNDRED THIRTY-EIGHT AND
14/100 ($7,346,838.14) DOLLARS per annum,
for the period commencing on the fifteenth
(15th) anniversary of the Rent Commencement
Date and ending on the Expiration Date;
which Fixed Rent shall be payable commencing on the
Rent Commencement Date and thereafter in equal
monthly installments in advance on the first day of
each and every calendar month during the term of this
Lease, and
(ii) additional rent (herein called "Additional Charges")
consisting of Tax Payments (as such term is defined
in Section 3.02(a) hereof) and Operating Payments (as
such term is defined in Section 3.03(a) hereof) and
all other sums of money as shall become due from and
payable by Tenant to Landlord hereunder; and
B. With respect to the Office Premises:
(i) Fixed Rent at the rate of:
(w) FIVE MILLION SIX HUNDRED FOURTEEN THOUSAND
THREE HUNDRED TWELVE AND 50/100
($5,614,312.50) DOLLARS per annum, for the
period commencing on the Rent Commencement
Date and ending on the day immediately
preceding the fifth (5th) anniversary of the
Rent Commencement Date;
(x) SIX MILLION THREE HUNDRED SEVENTY-SEVEN
THOUSAND EIGHT HUNDRED FIFTY-NINE AND 00/100
($6,377,859.00) DOLLARS per annum, for the
period commencing on the fifth (5th)
anniversary of the Rent Commencement Date
and ending on the day immediately
3
preceding the tenth (10th) anniversary of
the Rent Commencement Date;
(y) EIGHT MILLION TWO HUNDRED SIXTY-FOUR
THOUSAND TWO HUNDRED SIXTY-EIGHT AND 00/100
($8,264,268.00) DOLLARS per annum, for the
period commencing on the tenth (10th)
anniversary of the Rent Commencement Date
and ending on the day immediately preceding
the fifteenth (15th) anniversary of the Rent
Commencement Date; and
(z) NINE MILLION SEVEN HUNDRED FORTY-SIX
THOUSAND FOUR HUNDRED FORTY-SIX AND 00/100
($9,746,446.00) DOLLARS per annum, for the
period commencing on the fifteenth (15th)
anniversary of the Rent Commencement Date
and ending on the Expiration Date;
which Fixed Rent shall be payable commencing on the
Rent Commencement Date and thereafter in equal
monthly installments in advance on the first day of
each and every calendar month during the term of this
Lease, and
(ii) Additional Charges consisting of Tax Payments and
Operating Payments and all other sums of money as
shall become due from and payable by Tenant to
Landlord hereunder;
all to be paid in lawful money of the United States to Landlord at its office,
or such other place, or to Landlord's agent and at such other place, as Landlord
shall designate by notice to Tenant.
1.05. For purposes of this Lease, the following terms shall
have the following meanings:
(a) "Fixed Rent" shall mean the aggregate of the Fixed Rent set
forth in Subsection 1.04.A.(i) hereof (with respect to the
Retail Premises) and the Fixed Rent set forth in Subsection
1.04.B.(i) hereof (with respect to the Office Premises).
(b) "Commencement Date" shall mean the date which is the earlier
to occur of: (i) the date that is five (5) Business Days (as
such term is defined in Section 35.05(1) hereof) following the
receipt Tenant of a notice from Landlord advising Tenant that
the Pre-Commencement Building Work (as such term is defined on
Exhibit C attached hereto) to be performed by Landlord to
prepare the Premises for Tenant's
4
occupancy for the performance of Tenant's Work (as such term
is defined in Section 38.01 hereof) has been substantially
completed (herein called, a "Substantial Completion Notice"),
which Substantial Completion Notice shall be accompanied by a
copy of a Certificate of Substantial Completion (AIA Document
G704) as to the Pre-Commencement Building Work in the form of
Exhibit Z attached hereto (herein called "Landlord's
Architect's Certificate") which shall have been completed
(including, without limitation, the attachment of the list of
items of Pre-Commencement Building Work to be completed or
corrected as contemplated in such Certificate) and signed by
Landlord's architect; provided, however, that if Tenant timely
disputes the Substantial Completion Notice in accordance with
Section 2.01(b) hereof, upon the resolution of such dispute,
the date referred to in this clause (i) shall be the date upon
which the Pre-Commencement Building Work is determined in
accordance with such resolution to have been substantially
completed, or (ii) the date Tenant or anyone claiming under or
through Tenant, first occupies the Premises, or any part
thereof, for the performance of Tenant's Work. The Substantial
Completion Notice shall be delivered in the manner provided
for in either Section 29.01 or Section 29.04 hereof, at
Landlord's option. In the event the Commencement Date has not
occurred on or before December 31, 2021, notwithstanding to
the contrary contained herein, this Lease shall automatically
terminate. The Pre-Commencement Building Work shall not be
deemed substantially complete unless and until the items of
work set forth on Exhibit BB annexed hereto are substantially
complete; provided, however, that the parties acknowledge that
Exhibit BB does not constitute a complete list of all items of
Pre-Commencement Building Work which must be substantially
completed in order for the Pre-Commencement Building Work to
be deemed substantially complete and that the incorporation by
reference of Exhibit BB shall not be deemed to expand the
scope of the Building Work.
(c) "Rent Commencement Date" shall mean the date that is the sixth
(6th) month anniversary of the Commencement Date.
Tenant acknowledges and agrees that the copy of Landlord's Architect's
Certificate to be furnished hereunder as to the Pre-Commencement Building Work
is being delivered without representation or warranty as to its accuracy or
completeness, as an accommodation to Tenant to assist Tenant in preparing its
punch list hereunder, and Landlord assumes no responsibility or liability
whatever with respect to such Landlord's Architect's Certificate.
At the request of either party, Landlord and Tenant shall execute,
acknowledge and deliver to each other an instrument in the form annexed hereto
as Exhibit P confirming the
5
Commencement Date, the Rent Commencement Date, and the Expiration Date of this
Lease; provided, however, the failure of either party to execute, acknowledge
and deliver such instrument shall not affect in any manner whatsoever the
occurrence or the validity of any of the foregoing dates set forth in this
Section 1.05.
1.06. Tenant covenants and agrees to pay Fixed Rent and
Additional Charges promptly when due without notice or demand therefor (other
than, in the case of non-recurring Additional Charges only, such notices or
invoices therefor as are expressly provided for in this Lease) and without any
abatement, deduction or setoff for any reason whatsoever, except as may be
expressly provided in this Lease. Fixed Rent and Additional Charges shall be
paid by good and sufficient check (subject to collection drawn on a New York
City bank which is a member of the New York Clearing House Association or a
successor thereto. All checks for payment of Fixed Rent and Additional Charges
shall be sent to Landlord at the address set forth in the invoice therefor by a
nationally recognized overnight courier service (e.g., Federal Express) for
next-Business Day delivery and such checks for monthly Fixed Rent and monthly
recurring Additional Charges shall be received by Landlord no later than the
third business day of each month. Tenant may, at Tenant's election, pay any
Fixed Rent and Additional Charges by wire transfer of immediately available
funds to the account of Landlord in accordance with the wiring instructions set
forth on Exhibit Q annexed hereto, except that Landlord may change such wiring
instructions from time to time during the term of this Lease upon not less than
fifteen (15) days prior written notice to Tenant. Unless another time period is
expressly provided herein, all Additional Charges shall be payable within twenty
(20) days after delivery to Tenant of an invoice therefor.
1.07. If the Rent Commencement Date occurs on a day other than
the first day of a calendar month, or if the Expiration Date occurs on a day
other than the last day of a calendar month, the Fixed Rent and Additional
Charges for the partial calendar month shall be prorated.
1.08. No payment by Tenant or receipt or acceptance by
Landlord of a lesser amount than the correct Fixed Rent or Additional Charges
shall be deemed to be other than a payment on account, nor shall any endorsement
or statement on any check or any letter accompanying any check or payment be
deemed an accord and satisfaction, and Landlord may accept such check or payment
without prejudice to Landlord's right to recover the balance or pursue any other
remedy in this Lease or at law provided. No payment by Tenant of any amount
under this Lease shall be deemed a waiver by Tenant of any rights of Tenant
under this Lease to dispute the amount of such payment.
1.09. As set forth in Section 1.04 hereof, Fixed Rent shall be
payable in equal monthly installments. Any apportionments or prorations of Fixed
Rent or Additional Charges to
6
be made under this Lease for any calendar month shall be made on the basis of
the actual number of days in such calendar month.
1.10. If any of the Fixed Rent or Additional Charges payable
under the terms and provisions of this Lease shall be or become uncollectible,
reduced or required to be refunded because of any act or law enacted by a
governmental authority, Tenant shall enter into such agreement(s) and take such
other steps (without additional expense to Tenant) as Landlord may reasonably
request and as may be legally permissible to permit Landlord to collect the
maximum rents which from time to time during the continuance of such legal rent
restriction may be legally permissible (but not in excess of the amounts
reserved therefor under this Lease). Upon the termination of such legal rent
restriction: (a) the Fixed Rent and/or Additional Charges shall become and
thereafter be payable in accordance with the amounts reserved herein for the
periods following such termination and (b) Tenant shall pay to Landlord within
twenty (20) days after being billed, to the maximum extent legally permissible,
an amount equal to (i) the Fixed Rent and/or Additional Charges which would have
been paid pursuant to this Lease but for such legal rent restriction less (ii)
the rents paid by Tenant during the period such legal rent restriction was in
effect.
1.11. Additional Charges shall be deemed to be rent and
Tenant's failure to pay Additional Charges shall be deemed equivalent to a
failure to pay Fixed Rent hereunder and Landlord shall be entitled to all the
rights and remedies provided herein or by law for a default in the payment of
Additional Charges as for a default in the payment of Fixed Rent
(notwithstanding the fact that Tenant may not then also be in default in the
payment of Fixed Rent).
ARTICLE 2
Delivery and Use of Premises
2.01. (a) For purposes hereof, the terms "Building Work",
"Pre Commencement Building Work" and "Post-Commencement Building Work" shall
have the respective meanings set forth on Exhibit C attached hereto. The
Building Work shall not include the Additional Tenant Work (as such term is
defined in Section 38.05(a) hereof. Subject to the provisions of this Article 2,
Landlord shall substantially complete the Post-Commencement Building Work in
accordance with the schedule therefor set forth on Exhibit C attached hereto.
Except as expressly provided to the contrary in this subsection 2.01(a), Tenant
shall accept the Premises "as is" on the date of this Lease, subject only to
Landlord's obligation to complete the Building Work, and Landlord shall not
thereafter be required to perform any work, install any fixtures or equipment or
render any services to make the Premises ready or suitable for Tenant's
7
use or occupancy. Landlord shall perform the Building Work in the manner and
subject to the provisions of Exhibit C attached hereto. The Pre-Commencement
Building Work shall be deemed to have been substantially completed when the same
has been completed except for (i) minor details or adjustments that may not then
be completed the non-completion of which will not materially interfere with
Tenant's ability to perform Tenant's Work, and (ii) items which, in accordance
with good construction practice, should be performed after completion of
then-incomplete Tenant's Work, subject to Landlord's obligation to complete the
Pre-Commencement Building Work. The Post-Commencement Building Work shall be
deemed to have been substantially completed when the same has been completed
except for (i) minor details or adjustments that may not then be completed the
non-completion of which will not materially interfere with Tenant's ability to
perform Tenant's Work or Tenant's use or enjoyment of the Premises for the
conduct of its Business, and (ii) items which, in accordance with good
construction practice, should be performed after completion of Tenant's Work,
may not then be completed, subject to Landlord's obligation to complete the
Post-Commencement Building Work.
(b) Tenant shall have the right, within fourteen (14) days
after delivery to Tenant of a Substantial Completion Notice (and in any event
prior to Tenant's taking possession of the Premises for the performance of
Tenant's Work or any other reason, other than the taking of measurements and
performing other permitted pre-construction activities), to notify Landlord in
writing (herein called a "Substantial Completion Dispute Notice") that Tenant
disputes that the Pre-Commencement Building Work is substantially complete,
which Substantial Completion Dispute Notice shall set forth in detail the
specific respects in which Tenant believes that Pre-Commencement Building Work
is not substantially complete. Upon at least forty-eight hours prior notice to
the other, each of Landlord and Tenant agrees to make a representative
reasonably available during ordinary business hours during the fourteen (14) day
period following the giving of a Substantial Completion Notice to conduct a
walk-through inspection of the Premises and the Pre-Commencement Building Work
and testing of mechanical systems. In the event that Tenant gives a Substantial
Completion Dispute Notice, then (i) pending the resolution of such dispute,
Landlord's position as to the date on which the Pre-Commencement Building Work
was substantially completed shall control, and (ii) if such dispute is not
resolved between the parties within five (5) Business Days following the
delivery of such Substantial Completion Dispute Notice, such dispute shall be
resolved by binding arbitration under the Expedited Procedures provisions
(currently Rules 56 through 60) of the Arbitration Rules for the Real Estate
Industry of the American Arbitration Association (as amended and effective April
1, 1997) (herein called "Expedited Arbitration"). The taking of possession of
the Premises by Tenant for the performance of Tenant's Work or for any other
reason whatsoever (other than the taking of measurements and performing other
permitted pre-construction activities) shall be deemed an acceptance of such
portion of the Premises and substantial completion by Landlord of the
Pre-Commencement Building Work with respect thereto; provided, however, if
Tenant shall
8
furnish Landlord with a list (herein called a "Punchlist"), within ten (10)
Business Days after the date Tenant takes possession of the Premises, specifying
the items of Pre-Commencement Building Work which have not been substantially
completed and which are capable, with the exercise of reasonable diligence, of
being discovered within ten (10) Business Days of the date Tenant takes
possession of the Premises, or if Tenant shall furnish Landlord with a list
(herein called a "Latent Defect List") within six (6) months after the date
Tenant takes possession of such portion of the Premises, specifying latent
defects in the performance of Pre-Commencement Building Work which could not be
discovered using due diligence during an inspection of such floor of the
Premises during such aforesaid ten (10) Business Day period, or if Tenant shall
furnish Landlord with a list (herein called an "HVAC List") within one (1) year
after the date Tenant takes possession of such portion of the Premises,
specifying defects in the heating, ventilating and air-conditioning systems of
the Premises which could not be discovered using due diligence during such
aforesaid ten (10) Business Day period, then the taking of possession of such
portion of the Premises by Tenant shall be deemed an acceptance of the Premises,
and substantial completion by Landlord of Pre-Commencement Building Work except
with respect to the items set forth on any such Punchlist, Latent Defect List or
HVAC List, but the giving of the Punchlist, Latent Defect List or HVAC List
shall not affect the occurrence of the Rent Commencement Date. Landlord agrees
to use reasonable efforts to commence promptly and complete, subject to Force
Majeure Causes, the items set forth on the Punchlist, Latent Defect List and/or
HVAC List within thirty (30) days after the date that Landlord shall receive
such Punchlist, Latent Defect List or HVAC List.
(c) Landlord shall be deemed to have substantially completed
each item of the Post-Commencement Building Work and Tenant shall be deemed to
have accepted each item of the Post-Commencement Building Work on the earlier to
occur of (i) the date on which Landlord notifies Tenant of the substantial
completion of such item of Post-Commencement Building Work (each such notice
being herein called a "Post-Commencement Substantial Completion Notice"), which
Post-Commencement Substantial Completion Notice shall be accompanied by a copy
of a Landlord's Architect's Certificate as to such item of the Post-Commencement
Building Work, which Landlord's Architect's Certificate shall have been
completed (including, without limitation, the attachment of the list of any
aspects of such item of Post-Commencement Building Work to be completed or
corrected as contemplated in such Certificate) and signed by Landlord's
architect, or (ii) the date on which Tenant first occupies, for the conduct of
business, any portion of the Premises that is used in connection with such item
of Post-Commencement Building Work, subject, however, to Tenant's right to give
a Substantial Completion Dispute Notice, Punchlist, Latent Defect List or an
HVAC List with respect to such item of Post-Commencement Building Work within
fourteen (14) days, ten (10) Business Days, six (6) months or one (1) year,
respectively, of the earlier to occur of the dates described in clauses (i) and
(ii) of this sentence with respect to such item of Post-Commencement Building
Work. Landlord agrees to use reasonable efforts to commence promptly and
complete, subject to
9
Force Majeure Causes, the items set forth on the Punchlist, Latent Defect List
and/or HVAC List with respect to the Post-Commencement Building Work pursuant to
this Section 2.01(c) within thirty (30) days after the date that Landlord shall
receive such Punchlist, Latent Defect List or HVAC List. Tenant acknowledges
and agrees that the copy of Landlord's Architect's Certificate to be furnished
hereunder as to any item of Post-Commencement Building Work is being delivered
without representation or warranty as to its accuracy or completeness, as an
accommodation to Tenant to assist Tenant in preparing its punch lists hereunder,
and Landlord assumes no responsibility or liability whatever with respect to
such Landlord's Architect's Certificate.
(d) (i) If for any reason whatsoever, Landlord shall be unable
to deliver possession of the Premises on any date anticipated for such delivery
by Landlord or Tenant, then notwithstanding anything to the contrary
hereinbefore contained, the term of this Lease shall commence on the date on
which Landlord does so deliver possession of the Premises. Landlord shall not be
subject to any liability for failure to give possession of any portion of the
Premises (except as provided in Section 2.01 (d)(ii) hereof), and the validity
of this Lease shall not be impaired under such circumstances, nor the same be
construed in any way to extend the term of this Lease (except insofar as the
Expiration Date, which, as provided in Section 1.03 hereof, is the last day of
the month in which occurs the twentieth (20th) anniversary of the day preceding
the Rent Commencement Date, is extended by reason of the resulting delay in the
occurrence of the Commencement Date and Rent Commencement Date). Tenant hereby
waives any right to rescind this Lease under the provisions of Section 223(a)
of the Real Property Law of the State of New York, and agrees that the
provisions of this Article are intended to constitute "an express provision to
the contrary" within the meaning of said Section 223(a), but the foregoing
provisions of this sentence shall not be deemed to limit Tenant's rights
pursuant to Sections 2.01(d)(ii) and (iii) hereof.
(ii) In the event that the Commencement Date shall
not have occurred on or before July 26, 2000 (herein called the "Penalty Date"),
which Penalty Date shall be extended by one day for each day Landlord is delayed
in substantially completing the Pre-Commencement Building Work by reason of any
Tenant Delay (as such term is defined in Section 2.01(g) hereof), then, as
Tenants sole remedy (except as provided in Section 2.01(d)(iii) hereof) on
account of the failure of the Commencement Date so to have occurred, the Rent
Commencement Date shall be extended (i.e., beyond the date the Rent
Commencement Date would have occurred but for the provisions of this Section
2.01(d)(ii)) by two (2) days for each day from and after the Penalty Date to
(but not including) the date on which the Commencement Date occurs (or would
have occurred but for the occurrence of any Tenant Delay), provided, however,
that the Rent Commencement Date shall in no event be extended (i.e., beyond the
date the Rent Commencement Date would have occurred but for the provisions of
this
10
Section 2.01(d)(ii)) by more than five hundred forty-eight (548) days by reason
of the provisions of this Section 2.01(d)(ii).
(iii) In the event that the Commencement Date shall
not have occurred on or before August 16, 2000 (herein called the "Termination
Date"), which Termination Date shall be extended by one day for each day
Landlord is delayed in substantially completing the Pre-Commencement Building
Work by any Tenant Delay, then, as Tenant's sole remedy (except as provided in
Section 2.01(d)(ii) hereof) on account of the failure of the Commencement Date
so to have occurred, Tenant shall have the right to terminate this Lease by
notifying Landlord in writing of such election to terminate not later than
forty-five (45) days after the Termination Date, and such notice of termination
shall be effective on the fifteenth (15) Business Day following the receipt
thereof by Landlord unless the Commencement Date occurs prior to the end of such
fifteen (15) Business Day period.
(e) Landlord and Tenant acknowledge and agree that the
performance of Tenant's Work may be taking place simultaneously with the
performance by Landlord of portions of the Building Work. Landlord and Tenant
shall each use reasonable efforts to coordinate the performance of Tenant's Work
and the Building Work in such a manner that there will not be delays (except to
a de minimis extent) in the performance of Tenant's Work or the Building Work.
Such efforts on the part of Tenant shall include, without limitation, Tenant's
compliance with the provisions of Section 11.06 of this Lease.
(f) In the event that Tenant is actually delayed in occupying
the Office Premises for the conduct of its business or using the Retail Premises
for the purposes permitted hereunder (including, without limitation, subleasing
to a user or use by a subtenant) as the result of (i) any wrongful act or
omission of Landlord or any of Landlord's agents, contractors or employees,
including, without limitation, Landlord's failure to comply with the provisions
of subsection 2.01(e) hereof, (ii) Landlord's wrongful withholding of approval
to any of Tenant's plans for Tenant's Work (as more particularly set forth in
Sections 11.01 and 38.01 hereof), or (iii) Landlord's failure to complete any
item of the Post-Commencement Building Work (except to the extent that such
failure may be the result of any Tenant Delay), then, in addition to any
extension applicable pursuant to Section 2.01(d)(ii) hereof, the Rent
Commencement Date shall be delayed by one day for each day that Tenant is
actually delayed in occupying the Premises for the conduct of its business or
using the Retail Premises for the purposes permitted hereunder (including,
without limitation, subleasing to a user or use by a subtenant) as a result of
such wrongful act or omission, wrongful withholding of approval (subject to
Section 11.01 hereof), or failure to complete an item of the Post-Commencement
Building Work (each such day of delay being herein referred to as a day of
"Landlord Delay"); provided that Tenant shall have notified Landlord of any
Landlord Delay promptly (and in any event within ten (10) days) after Tenant
first learns of such Landlord Delay.
11
(g) For purposes hereof, the term "Tenant Delay" shall mean
any actual delay in the performance of the Building Work resulting from (i) any
wrongful act or omission of Tenant or any of Tenant's agents, contractors or
employees, including, without limitation, Tenant's failure to comply with the
provisions of subsection 2.01(c) hereof, (ii) any request by Tenant that
Landlord modify the nature or scope of the Building Work, (iii) any request by
Tenant that Landlord delay the performance of any portion of the Building Work
or (iv) any delay by Tenant in furnishing to Landlord any information requested
by Landlord in connection with changes to or delays in the performance of the
Building Work requested by Tenant; provided that, in the case of any of the
circumstances set forth in clauses (i) through (iv), Landlord shall have
notified Tenant promptly (and in any event within ten (10) days) after Landlord
first learns of such Tenant Delay. In the event that Landlord is actually
delayed in substantially completing the Pre-Commencement Building Work as the
result of a Tenant Delay, the Commencement Date shall be deemed to be the
earlier of (i) the date on which Landlord would have completed such
Pre-Commencement Building Work but for such Tenant Delay, or (ii) the date on
which Tenant or anyone claiming under or through Tenant, first occupies the
Premises, or any part thereof, for the performance of Tenant's Work. In the
event that Landlord is actually delayed in substantially completing any item of
the Post-Commencement Building Work as the result of a Tenant Delay, Tenant
shall not be entitled to any extension of the Rent Commencement Date due to such
delay in the completion of such item of Post-Commencement Building Work, but
Landlord shall complete any such incomplete items of Post-Commencement Building
Work with reasonable promptness after the circumstances causing such delay are
alleviated but without obligation to use overtime or premium-pay labor in
connection therewith. Tenant shall reimburse Landlord as Additional Charges for
any additional out-of-pocket expenses reasonably incurred by Landlord in
performing the Building Work within twenty (20) days after delivery of an
invoice therefor, which invoice shall be accompanied by copies of the bills for
such out-of-pocket expenses.
(h) Any disputes between Landlord and Tenant as to the
occurrence, effect or number of days of Landlord Delay or Tenant Delay shall be
resolved by Expedited Arbitration, which shall be invoked by either Landlord or
Tenant giving notice to the other (as the case may be) stating that such dispute
shall be resolved by Expedited Arbitration pursuant to the provisions of this
Section 2.01(h).
(i) In the event that Landlord shall fail to complete (except
by reason of Tenant Delay or Force Majeure Causes) any item of Building Work on
any Punchlist, Latent Defect List and/or HVAC List given with respect to either
Pre-Commencement or Post-Commencement Building Work within Thirty (30) days
after the delivery to Landlord of such Punchlist, Latent Defect List and/or HVAC
List, or as to any such item of Work which cannot reasonably completed within
such 30-day period, if Landlord has failed to commence same promptly after
receipt of such Punchlist, Lanent Defect List and/or HVAC List and/or thereafter
12
diligently to pursue same to completion, then Tenant may notify Landlord in
writing (herein called a "Punchlist Self-Help Notice") of such failure, setting
forth in reasonable detail the incomplete items of Punchlist, Latent Defect List
and/or HVAC List work and Tenant's intention to exercise its self help rights
pursuant to this Section 2.01(j) and stating that Landlord has a period of
fifteen (15) days following the giving of such Punchlist Self-Help Notice to
dispute Tenant's right to exercise self-help, a copy of which Punchlist
Self-Help Notice shall be delivered simultaneously to any Superior Lessor or
Superior Mortgagee whose name and address shall have previously have been
furnished to Tenant. If, within fifteen (15) days after the giving of a
Punchlist Self-Help Notice, Landlord shall fail (except by reason of Tenant
Delay or Force Majeure Causes) to complete any such items of Building Work so
identified in the Punchlist Self-Help Notice, then Tenant may, at Tenant's
election, perform or complete, as the case may be, the items of Punchlist,
Latent Defect List and/or HVAC List work set forth in the Punchlist Self Help
Notice, in which event Landlord shall reimburse Tenant for Tenant's reasonable
out of pocket expenses paid to third parties to complete such items of work set
forth in the Punchlist Self-Help Notice (herein called "Self Help Costs"),
together with interest thereon at the Interest Rate (as such term is defined in
Section 35.05(j) hereof) from the date incurred until the date repaid to Tenant,
within twenty (20) days after delivery of an invoice to Landlord therefor. If
Landlord fails so to reimburse Tenant for such Self Help Costs within such
20-day period, Tenant may notify Landlord of such failure and of Tenant's
intention to offset such unpaid Self-Help Costs against the next installment(s)
of Fixed Rent thereafter payable hereunder (herein called an "Offset Notice"), a
copy of which Offset Notice shall be delivered simultaneously to any Superior
Lessor or Superior Mortgagee whose name and address shall have previously have
been furnished to Tenant, and if Landlord thereafter fails to reimburse Tenant
for such unpaid Self-Help Costs within five (5) Business Days after receipt of
an Offset Notice, Tenant may offset such unpaid Self-Help Costs against the next
installment(s) of Fixed Rent thereafter payable hereunder, together with
interest on such unpaid Self-Help Costs, from the date paid by Tenant to the
date offset by Tenant, at the Interest Rate. Notwithstanding anything to the
contrary contained in this Section 2.01(i), in the event Landlord notifies
Tenant in writing (herein called a "Section 2.01(i) Dispute Notice") within the
fifteen (15) day period following Landlord's receipt of a Punchlist Self-Help
Notice that Landlord disputes whether an item of work has been properly listed
on a Punchlist, Latent Defect List and/or HVAC List, as the case may be, or
Tenant's claim that Landlord has failed to complete same or Tenant's right to
exercise the self-help and offset rights in accordance with this Section
2.01(i), then (i) Tenant may not exercise such self-help rights until a final
resolution of such dispute unless the failure to perform the work in question at
such time would materially adversely interfere with Tenant's use of the Premises
or the performance of Tenant's Work in which event Tenant may exercise such
self-help rights notwithstanding Landlord's notice of dispute, (ii) Tenant shall
in no event have the right to exercise such offset rights until such dispute has
been finally resolved, and (iii) Landlord shall in no event be responsible for
any costs or expenses incurred by Tenant in exercising such self-help rights if
such dispute is resolved in Landlord's favor. Any such dispute which is not
resolved
13
between the parties within ten (10) Business Days after the giving of a
Self-Help Dispute Notice may be submitted by either party for resolution by
Expedited Arbitration. If such dispute is resolved in Tenant's favor, then,
within ten (10) Business Days following resolution of such dispute, Landlord
shall reimburse Tenant for any Self-Help Costs owed to Tenant pursuant to such
resolution, together with interest thereon at the Interest Rate from the date
paid by Tenant to the date reimbursed to Tenant, failing which Tenant may offset
such unpaid Self-Help Costs against the next installment(s) of Fixed Rent
thereafter payable hereunder, together with interest on such unpaid Self-Help
Costs, from the date paid by Tenant to the date offset in full by Tenant, at the
Interest Rate.
(j) In the event that Landlord shall fail to substantially
complete (except by reason of Tenant Delay or Force Majeure Causes) any item of
Post-Commencement Building Work on or before the projected date of completion
for such item or work set forth on Exhibit C hereof (each, a "Projected
Completion Date"), then Tenant may notify Landlord in writing (herein called a
"Post-Commencement Building Work Self-Help Notice") of such failure, setting
forth in reasonable detail the incomplete items of Post-Commencement Building
Work and Tenant's intention to exercise its self help rights pursuant to this
Section 2.01(j) and stating that Landlord has a period of fifteen (15) days
following the giving of such Post-Commencement Building Work Self Help Notice to
dispute Tenant's right to exercise self-help, a copy of which Post-Commencement
Building Work Self-Help Notice shall be delivered simultaneously to any Superior
Lessor or Superior Mortgagee whose name and address shall have previously have
been furnished to Tenant. If, within fifteen (15) days after the giving of a
Post Commencement Building Work Self-Help Notice, Landlord shall fail (except by
reason of Tenant Delay or Force Majeure Causes) to complete any such items of
work so identified in the Post Commencement Building Work Self-Help Notice, then
Tenant may, at Tenant's election, perform or complete, as the case maybe, the
items of any such items of work, in which event Landlord shall reimburse Tenant
for Tenant's Self-Help Costs in completing such items of work, together with
interest thereon at the Interest Rate from the date incurred until the date
repaid to Tenant, within twenty (20) days after delivery of an invoice to
Landlord therefor. If Landlord fails so to reimburse Tenant for such Self Help
Costs within such 20-day period, Tenant may give an Offset Notice to Landlord, a
copy of which Offset Notice shall be delivered simultaneously to any Superior
Lessor or Superior Mortgagee whose name and address shall have previously have
been furnished to Tenant, and if Landlord thereafter fails to reimburse Tenant
for such unpaid Self-Help Costs within five (5) Business Days after receipt of
an Offset Notice, Tenant may offset such unpaid Self-Help Costs against the next
installment(s) of Fixed Rent thereafter payable hereunder, together with
interest on such unpaid Self-Help Costs, from the date paid by Tenant to the
date offset by Tenant, at the Interest Rate. Notwithstanding anything to the
contrary contained in this Section 2.01(j), in the event that Landlord notifies
Tenant in writing (herein called a "Section 20l(j) Dispute Notice") within
fifteen (15) days after Landlord's receipt of a Post-Commencement Building Work
Self-Help Notice that Landlord disputes Tenant's claim that
14
Landlord has failed to complete an item of Post-Commencement Building Work or
Tenant's right to exercise the self-help and offset rights in accordance with
this Section 2.01(i), then (i) Tenant may not exercise such self-help rights
unless the failure to perform the work in question at such time would materially
adversely interfere with Tenant's use of the Premises or the performance of
Tenant's Work in which event Tenant may exercise such self-help rights
notwithstanding Landlord's notice of dispute, (ii) Tenant shall in no event have
the right to exercise such offset rights until such dispute has been finally
resolved, and (iii) Landlord shall in no event be responsible for any costs or
expenses incurred by Tenant in exercising such self-help rights if such dispute
is resolved in Landlord's favor. Any such dispute which is not resolved between
the parties within ten (10) Business Day after the giving of a Self-Help Dispute
Notice may be submitted by either party for resolution by Expedited Arbitration.
If such dispute is resolved in Tenant's favor, then, within ten (10) Business
Days following resolution of such dispute, Landlord shall reimburse Tenant for
any Self Help Costs owed to Tenant pursuant to such resolution, together with
interest thereon at the Interest Rate from the date paid by Tenant to the date
reimbursed to Tenant, failing which Tenant may offset such unpaid Self-Help
Costs against the next installment(s) of Fixed Rent thereafter payable
hereunder, together with interest on such unpaid Self-Help Costs, from the date
paid by Tenant to the date offset in full by Tenant, at the Interest Rate.
2.02. (a) Tenant shall use and occupy the Retail Premises for
retail uses and/or other uses permitted under this Section 2.02(a), and for no
other purposes; provided, however, that in no event shall the Retail Premises be
used for (i) an outlet, warehouse, close-out, bargain or any form of "deep
discount" store, including, without limitation, stores whose primary business is
the sale or discounting of merchandise at "closeout", "wholesale", "bargain
basement", "warehouse", or other similarly discounted prices (e.g., Xxxxx, All
for 69 Cents, Odd Lot) or the conduct of fire, "going out of business",
bankruptcy and sheriff or receiver sales; (ii) hospital or other medical uses,
including, without limitation, medical or dental offices, agencies, or clinics;
(iii) a drug or any other type of rehabilitation center; (iv) a pawn shop or
flea market; (v) a junk yard, recycling center or other center for the
collection, disposal, incineration or reduction of garbage or refuse; (vi) an
arcade for video or other electronic games, but this Section 2.02(a) shall not
be deemed to prohibit the use of the Retail Premises for a "high-end" video or
electronic game center of a standard of operation comparable to the standard of
operation maintained as of the date of this Lease by the Broadway City facility
located at 000 X. 00xx Xxxxxx, Xxx Xxxx, Xxx Xxxx; or (vii) conduct of an
auction, other than use of the Retail Premises as an auction house with a
standard of operation comparable to the standard of operation maintained as of
the date of this Lease by Xxxxxxxx Auctions & Appraisals, Xxxxxxx Xxxxx
Galleries, Christies or Sotheby's in New York City. Subject to the preceding
sentence and Section 2.02(d) hereof and Tenant's compliance with all applicable
Legal Requirements, the Retail Premises may be used for restaurant and/or bar
uses and/or for entertainment uses including, without limitation, the following
uses: (i) a museum, art and/or memorabilia gallery,
15
and/or exhibit space for memorabilia and/or artifacts (historic, music, art,
sports or otherwise), (ii) a movie or multimedia screening room, (iii) a live
entertainment performance space, (iv) the production of mixed and multimedia
entertainment events, (v) an interactive media space (including, without
limitation, internet and/or worldwide web connection and viewing sites), and/or
(vi) an audio, video, multimedia and/or interactive media production studio.
(b) Tenant shall use and occupy the Office Premises for executive
and general offices and Permitted Ancillary Uses [as such term is defined in
this Section 2.02(b)](subject to Tenant's compliance with all applicable Legal
Requirements relating to such Permitted Ancillary Uses), and for no other
purpose. As used herein "Permitted Ancillary Uses" shall mean uses incidental
and ancillary to the use of the Office Premises for general and executive
offices, including, without limitation, (i) studio facilities for use by
Tenant's employees and guests, (ii) auditorium facilities for use by Tenant's
employees and guests, (iii) computer and communication facilities, (iv)
conference facilities, (v) kitchens, pantries and dining room facilities for
Tenant's employees and guests, (vi) fitness facilities for use by employees and
guests of Tenant, (vii) vending machines for the sale of food, confections,
beverages, cigars and cigarettes, newspapers and other convenience items to
employees and guests of Tenant, (viii) normal office equipment and machines
(including, without limitation, computers and other electronic data processing
equipment and communications equipment), equipment for printing, producing and
reproducing documents, forms, circulars and other materials used in connection
with the conduct of Tenant's business, (ix) facilities for the storage of files,
securities, equipment and supplies in connection with the uses set forth in this
Section 2.02(b), (x) art and/or memorabilia gallery, and (xi) showroom purposes.
The Office Premises may not be used for any of the purposes set forth in clauses
(i) through (vii) of Section 2.02(a) hereof, except that the Office Premises may
be used for medical/dental offices (but not as a medical/dental hospital or
clinic) provided that any special alterations or improvements made to
accommodate any use of the Premises for individual medical/dental offices (such
as, for example, additional plumbing, waste lines, floor or wall reinforcement)
shall be deemed Non-Standard Items for purposes of Section 12.01 of this Lease.
(c) The Facade (as such term is defined in Section 42.01 hereof) and
the rooftop (including, without limitation, any setbacks) may be used for the
purposes permitted in Article 42 hereof, subject to and in accordance with the
provisions of Article 42.
(d) Notwithstanding anything to the contrary contained in this Section
2.02, in no event may the Premises or any portion thereof be used (i) by an
agency, department or bureau of the United States Government, any state or
municipality within the United States or any foreign government, or any
political subdivision of any of them, or (ii) for gambling activities or the
conduct of obscene or pornographic activities.
16
(e) Tenant shall have the right, at Tenant's sole cost and expense, to
change the use of either the fifth (5th) floor or both the fourth (4th) and
fifth (5th) floors of the Building from the use(s) permitted under this Lease
for the Retail Premises to the uses permitted under this Lease for Office
Premises. Any change to the Certificate of Occupancy of the Building required to
effectuate such change shall be made subject to and in accordance with the
provisions of Section 2.03 hereof, and any alterations required to be made in
connection with any such conversion shall be made subject to and in accordance
with this Lease, including, without limitation the provisions of Article 11 and
the provisions of Section 12.01 hereof with respect to "Non-Standard Items".
2.03. Landlord acknowledges that it has caused to be filed an
Alteration Type One application for the purpose of obtaining New York City
Building Department approval of the Building Work and to change the permitted
use of the Building to offices (with respect to the sixth (6th) through
twenty-fourth (24th) floors), mechanical for the twenty-fifth (25th) floor,
retail (with respect to the first (1st) through fifth (5th) floors), storage for
the subcellar, and storage and office for the cellar. The parties acknowledge
that this application will remain open until such time as Tenant completes its
improvements under separate Directive 14 applications. Landlord has delivered to
Tenant a copy of the Temporary Certificate of Occupancy issued for the core and
shell of the Building (herein called the "Core and Shell TCO"). Landlord will
be responsible, at Landlord's sole cost and expense until the Commencement Date
and thereafter at Tenant's sole cost and expense, for obtaining renewals of the
Core and Shell TCO, provided however that Landlord shall not be responsible for
any failure or inability to obtain a renewal of the Core and Shell TCO if and to
the extent such failure or inability results from any act or omission of Tenant
(including, without limitation, any violation resulting from the performance of
Tenant's Work). Tenant shall be responsible for obtaining a permanent
Certificate of Occupancy for offices (with respect to the sixth (6th) through
twenty-fourth (24th) floors), mechanical for the twenty-fifth (25th) floor,
retail (with respect to the first (1st) through fifth (5th) floors), storage for
the subcellar, and storage and office for the cellar, upon completion of
Tenant's Work (and, at Tenant's election, one or more amendments to the Core and
Shell TCO permitting occupancy on completed floors of the Building as Tenant's
Work is completed on such floors); provided, however, that Landlord shall, on or
before June 1, 2000, (i) file all controlled inspection reports (New York City
Building Department Forms TR-l), (ii) obtain all electrical and Fire Department
signoffs required in connection with the Building Work, and (iii) obtain a New
York City Building Department Letter of Completion for all applicable
applications filed with the New York City Building Department in connection with
the Building Work. In the event that a modification to the Building Work (or to
the plans with respect thereto in order to cause the plans to comply with
applicable Legal Requirements) is required as a condition of an amended Core and
Shell TCO or a permanent Certificate of Occupancy, then Landlord will be
responsible, at its expense, for diligently correcting such Building Work or
plans provided that this sentence shall not be deemed to expand the scope of the
Building Work.
17
If any governmental license or permit other than the Core and Shell TCO shall be
required for the proper and lawful conduct of Tenant's business in the Premises
or any part thereof, Tenant, at its expense, shall duly procure and thereafter
maintain such license or permit and submit the same to Landlord for inspection.
Tenant shall at all times comply with the terms and conditions of each such
license or permit. Additionally, should Alterations (as such term is defined in
Section 11.01(a) hereof) or Tenant's use of the Office Premises for other than
executive and general offices or Tenant's use of the Retail Premises for other
than retail use or Tenant's use of any portion of the Premises for a public
assembly use require any modification or amendment of the then current
Certificate of Occupancy for the Building or any other permit, Tenant shall
obtain same at Tenant's sole cost and expense. Landlord agrees to join in such
applications as may be required to obtain such amendments to the Core and Shell
TCO, a permanent Certificate of Occupancy, or any other such modification or
amendment or other permit and to otherwise cooperate with Tenant in connection
with obtaining same, provided however that Tenant shall reimburse Landlord (as
Additional Charges) for all reasonable out-of-pocket costs and expenses Landlord
incurs in connection therewith. The foregoing provisions are not intended to be
deemed Landlord's consent to any Alterations or to a use of the Premises not
otherwise permitted hereunder. Landlord shall be responsible for obtaining and
maintaining on a current basis throughout the term of this Lease any required
permits for the operation of the elevators, HVAC equipment and any other
equipment installed as part of the Building Work.
2.04. Tenant shall not at any time use or occupy the Premises, or
suffer or permit anyone to use or occupy the Premises, or do anything in the
Premises, or suffer or permit anything to be done in, brought into or kept on
the Premises, which in any manner (a) violates the Certificate of Occupancy for
the Premises or for the Building; (b) causes injury to the Premises or any
equipment, facilities or systems therein; (c) constitutes a violation of Legal
Requirements or the requirements of insurance bodies, provided such insurance
requirements do not prohibit the use of the Premises for the purposes permitted
under Section 2.02 hereof and either (x) are customary requirements in the
insurance industry for policies of insurance covering buildings containing both
office and retail use similar to the Building in the Times Square section of
Manhattan, or (y) relate to a special condition existing at the Building which
does not generally exist in buildings containing both office and retail use in
the Times Square section of Manhattan (the foregoing requirements of insurance
bodies described in this clause (c) being herein referred to as "Standard
Insurance Requirements"); (d) impairs the proper maintenance, operation and
repair of the Building and/or its equipment, facilities or systems; (e)
constitutes a public nuisance; or (f) makes unobtainable from reputable
insurance companies authorized to do business in New York State all-risk
property insurance, or liability, elevator, boiler or other insurance at
standard rates required to be furnished by Landlord under the terms of any
mortgages covering the Premises, provided such insurance is generally carried by
owners of buildings containing both office and retail use similar to the
Building in the Times Square section of Manhattan.
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ARTICLE 3
Operating Expenses and Real Estate Taxes
3.01. The terms defined below shall for the purposes of this
Lease have the meanings herein specified:
(a) "Operating Statement" shall mean an instrument or
instruments setting forth the Operating Payment payable by Tenant for a
specified Operating Year pursuant to this Article 3.
(b) "Operating Expenses" shall mean all expenses, determined
on a consistent basis, paid or incurred by Landlord and Landlord's affiliates
and/or on their behalf in respect of the repair, replacement, maintenance,
operation and/or security of the Real Property (as such term is defined in
Section 3.01(d) hereof) or required to be paid or reimbursed to the Manager in
accordance with the Management Agreement in effect from time to time pursuant to
Section 15.01 hereof, including, without limitation:
(i) salaries, wages, medical, surgical, insurance (including,
without limitation, group life and disability insurance) of
employees of Landlord or Landlord's affiliates or the Manager,
union and general welfare benefits, pension benefits,
severance and sick day payments, and other fringe benefits of
employees of Landlord and Landlord's affiliates (or the
Manager) and their respective contractors engaged in such
repair, replacement, maintenance, operation and/or security;
(ii) payroll taxes, worker's compensation, uniforms and related
expenses (whether direct or indirect) for such employees;
(iii) the cost of fuel, gas, steam, heat, ventilation, air
conditioning, chilled and condenser water, water, sewer and
other utilities, together with any taxes and surcharges on,
and fees paid in connection with the calculation and billing
of such utilities, if and to the extent, that, for any portion
of the term of this Lease, such utilities are not directly
metered and billed to Tenant;
(iv) the cost of casualty, liability, fidelity, rent and all other
insurance regarding the Real Property and/or any property on,
below or above the Real Property, and the repair, replacement,
maintenance, operation and/or security thereof;
19
(v) the cost of all supplies, tools, materials and equipment,
whether by purchase or rental, used in the repair,
replacement, maintenance, operation and/or security of the
Real Property, and any sales and other taxes thereon;
(vi) all Building Office expenses, such as telephone, utility,
stationery and similar expenses incurred in connection with
the repair, replacement, maintenance, operation and/or
security thereof;
(vii) the cost of cleaning, janitorial and security services,
including, without limitation, glass cleaning, snow and ice
removal and garbage and waste collection and/or disposal
subject to the provisions of Section 15.02 hereof;
(viii) the cost of alterations and improvements made or installed by
reason of Legal Requirements or applicable Standard Insurance
Requirements, which in either case are enacted or first become
applicable to the Premises after the Commencement Date and all
tools and equipment related thereto (herein collectively
called "Compliance Expenditures");
(ix) the cost of all other alterations, repairs, replacements
and/or improvements made or installed by Landlord or
Landlord's affiliates or the Manager, at their respective
expense, whether structural or non-structural, ordinary or
extraordinary, foreseen or unforeseen, and all tools and
equipment related thereto; provided, however, that if under
generally accepted accounting principles consistently applied
(herein called "GAAP"), any of the costs referred to in clause
(viii) or this clause (ix) are required to be capitalized,
then such capitalized costs (and, at Landlord's option, any
other costs included in Operating Expenses), together with
interest thereon at the Base Rate (as such term is defined in
subsection 35.050(j) hereof) in effect as of December 31 of
the year in which such expenditure is made, shall be amortized
or depreciated, as the case may be, over a period of time
which shall be the useful life of the item in question
determined in accordance with GAAP; provided however that with
respect to any capital improvement and/or any machinery or
equipment which is made or becomes operational, as the case
may be, which has the effect of reducing the expenses which
otherwise would be included in Operating Expenses (herein
collectively called "Cost Savings Expenditures"), the amount
included in Operating Expenses in any Operating Year until
such improvement and/or machinery or equipment has been fully
amortized or depreciated, as the case may be, shall be the
amount of savings, as reasonably estimated by Landlord,
resulting from the installation and operation of such
improvement and/or machinery or equipment;
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(x) the management fee payable to the Manager in accordance with
the Management Agreement (as such term is defined in Section
15.01 hereof) in effect from time to time pursuant to Section
15.01 hereof and all other amounts payable or reimbursable to
the Manager of whatever nature under the Management Agreement
(but without duplication of any amounts, e.g., non-recurring
overtime Building staff expenses, which are paid or reimbursed
by Tenant directly to the Manager or to Landlord);
(xi) all reasonable costs and expenses of legal, bookkeeping,
accounting and other professional services incurred in
connection with the operation, and management of the Real
Property except as hereinafter excluded; and
(xii) all other fees, costs, charges and expenses properly allocable
to the repair, replacement, maintenance, operation and/or
security of the Real Property, in accordance with then
prevailing customs and practices of the real estate industry
in the Borough of Manhattan, City of New York.
The term "Operating Expenses", as used and defined under this subsection (b),
shall not, however, include, or shall be reduced by, as the case may be, the
following items:
(1) depreciation and amortization (except as specifically
provided above in this subsection);
(2) interest on and amortization of debts (and costs and
charges incurred in connection with such financings);
(3) brokerage commissions;
(4) financing or refinancing costs;
(5) the cost of any electricity consumed in the Building;
(6) Taxes;
(7) salaries and fringe benefits for officers, employees and
executives above the grade of Building Manager;
(8) amounts received by Landlord through the proceeds of
insurance (or which would have been received as proceeds from insurance but for
Landlord's failure to maintain the insurance required to be maintained by
Landlord pursuant to this Lease) or condemnation or from
21
Tenant (other than pursuant to this Article 3) or otherwise to the extent such
amounts are compensation for sums previously included in Operating Expenses for
such Operating Year or any prior Operating Year.
(9) costs of repairs or replacements incurred by reason of
fire or other casualty, except that in connection therewith any amount equal to
the deductibles under Landlord's insurance policies (or in the event Landlord
shall not any insurance, an amount of deductibles customarily carried by
landlords of first-class office buildings comparable to the Building) may be
included within Operating Expenses, or costs of repairs or replacements incurred
by reason of condemnation;
(10) advertising and promotional expenditures;
(11) legal, accounting and other professional fees incurred in
connection with negotiations or disputes by Landlord, its affiliates or partners
with lenders, superior lessors or tenants, or the filing of a petition in
bankruptcy by or against Landlord or its affiliates;
(12) any expenditure paid to any corporation or entity related
to or affiliated with Landlord or the principals of Landlord to the extent such
expenditure exceeds the amount which would be paid in the absence of such
relationship;
(13) the cost of any service furnished to Tenant to the extent
that such cost is separately reimbursed to Landlord (other than through this
Article 3);
(14) cost of works of art of the quality and nature of "fine
art" rather than decorative art work customarily founding in first-class office
buildings which are similar to the Building; and
(15) capital expenditures, other than (i) Compliance
Expenditures, (ii) Cost Savings Expenditures, and (iii) the cost of replacing
components of Building plumbing, HVAC, electrical, mechanical, Class-E and
life-safety systems (herein collectively called "Building Systems") which are
generally replaced as part of routine maintenance of such systems by owners of
office buildings or buildings containing both office and retail use in midtown
Manhattan;
(16) the cost of performing the Building Work or any portion
thereof;
(17) the cost of repairing any defects in the roof, facade,
structural columns, load bearing walls or other structural elements of the
Building or any defects in any Building Systems installed by Landlord as part of
the Building Work; and
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(18) Building Work Future Compliance Expenditures (as such
term is defined in Section 8.01 hereof), except that Building Work Future
Compliance Expenditures which represent the cost of repairs, replacements,
alterations or improvements to the Premises which Landlord reasonably would
have made as a prudent landlord within a reasonable period of time prior to or
following the effective date of the Legal Requirement in question, regardless of
whether such Legal Requirement had been enacted, shall be includable in
Operating Expenses to the extent provided in clauses (viii) and (ix) of this
Section 3.01(b).
No item of expense shall be counted more than once either as an
inclusion in or an exclusion from Operating Expenses, and any expense which
should be allocated in accordance with GAAP, between the Land and the Building,
on the one hand, and any other property owned by Landlord or an affiliate of
Landlord, on the other hand, shall be properly allocated in accordance
therewith. Nothing contained in this Section 3.01(b) shall be deemed to obligate
Landlord to perform any repair, replacement, alteration or improvement or incur
any expense which Landlord is not otherwise required to perform or incur
pursuant to this Lease.
(c) "Operating Year" shall mean each calendar year in
which occurs any part of the term of this Lease.
(d) "Real Property" shall mean, collectively, the
Building (together with all personal property located therein and all fixtures,
facilities, machinery and equipment located therein and used in the operation
thereof, including, but not limited to, all cables, fans, pumps, boilers,
heating and cooling equipment, wiring and electrical fixtures and metering,
control and distribution equipment, component parts of the HVAC, electrical,
plumbing, elevator and any life or property protection systems (including,
without limitation, sprinkler systems), window washing equipment and snow
removal equipment), the Land, any property beneath the Land, the curbs,
sidewalks and plazas on and/or immediately adjoining the Land, and all
easements, air rights, development rights and other appurtenances to the
Building or the Land or both the Land and the Building.
(e) "Taxes" shall mean the real estate taxes, vault
taxes, assessments and special assessments, water charges, sewer rents and other
like charges, business improvement district or similar charges levied, assessed
or imposed upon or with respect to the Real Property, by any federal, state,
municipal or other governments or governmental bodies or authorities. If at any
time during the term of this Lease the methods of taxation prevailing on the
date hereof shall be altered so that in lieu of, or as an addition to or as a
substitute for, the whole or any part of such real estate taxes, assessments and
special assessments now imposed on real estate, there shall be levied, assessed
or imposed (x) a tax, assessment, levy, imposition, license fee or charge wholly
or partially as a capital levy or otherwise on the rents received therefrom. (y)
a tax with respect to the rentals payable hereunder other than general income
and gross receipts
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taxes, or (z) any other such additional or substitute tax, assessment, levy,
imposition, fee or charge, then all such taxes, assessments, levies,
impositions, fees or charges or the part thereof so measured or based shall be
deemed to be included within the term "Taxes" for the purposes hereof, but only
to the extent that such tax is imposed upon owners or lessees of real property
or buildings in the Borough of Manhattan in their capacity as owners or lessees
and only to the extent that the same would be payable if the real property were
the only property of Landlord. The term "Taxes" shall, notwithstanding anything
to the contrary contained herein, exclude any net income, franchise or "value
added" tax, inheritance tax or estate tax imposed or constituting a lien upon
Landlord or all or any part of the Land or Building, except to the extent that
any of the foregoing are hereafter assessed against owners or lessors of real
property in their capacity as such (as opposed to any such taxes which are of
general applicability). The amount of any assessments, special or otherwise, to
be included in Taxes for any year, in the case where the same may, at the option
of the taxpayer, be paid in installments, shall be limited to the amount of the
minimum installments (i.e., determined as if Landlord paid same in the maximum
number of permitted installments) plus interest charges by the applicable taxing
authorities due in respect of such year (whether or not Landlord elects to pay
in such maximum number of installments).
(f) "Tax Year" shall mean each period of twelve (12)
months, commencing on the first day of July of each such period, in which occurs
any part of the term of this Lease, or such other period of twelve (12) months
occurring during the term of this Lease as hereafter may be duly adopted as the
fiscal year for real estate tax purposes of the City of New York.
3.02. (a) Tenant shall pay to Landlord as Additional Charges for
each Tax Year an amount (herein called the "Tax Payment") equal to one hundred
(100%) percent of the Taxes for such Tax Year. The Tax Payment for each Tax Year
shall be due and payable in installments in the same manner that Taxes for such
Tax Year are due and payable by Landlord to the City of New York. Tenant shall
pay the full amount of each such installment to Landlord not later than the
twentieth (20th) day prior to the date (herein called the "Tax Due Date") on
which such installment is payable to the taxing authority, if the actual amount
of such installment has then been established by the taxing authority. If the
actual amount of such installment has not been established by the taxing
authority as of the 20th day prior to the Tax Due Date, then, on or before the
tenth (10th) day prior to the Tax Due Date, Tenant shall pay to Landlord an
estimated amount of Tenant's Tax Payment for such installment equal to 103% of
an amount determined by applying against the then-current assessed valuation of
the Real Property for purposes of teal estate tax payments, the tax or "mill"
rate applicable to the Real Property for the immediately prior Tax Year, and
divided by the applicable number of installments in which such Taxes are paid
(i.e., currently 2 such installments), and promptly after the actual Taxes are
established by the taxing authority, Landlord shall notify Tenant of same, and,
within twenty (20) days after delivery of such notice (i) Tenant shall pay to
Landlord any shortfall from the amount
24
paid by Tenant pursuant to such estimate, or (ii) Landlord shall refund any
overpayment made by Tenant pursuant to such estimate, as the case may be.
Landlord shall provide Tenant with a copy of the tax xxxx from the taxing
authorities promptly after receipt of same from the taxing authority, but
Tenant's Tax Payments shall be due and payable in accordance with the previous
sentence irrespective of whether a tax xxxx has been issued or delivered to
Tenant. If there shall be any increase in the Taxes for any Tax Year, whether
during or after such Tax Year, or if there shall be any decrease in the Taxes
for any Tax Year, the Tax Payment for such Tax Year shall be appropriately
adjusted and paid or refunded, as the case may be, in accordance herewith. If
during the term of this Lease, Taxes are required to be paid (either to the
appropriate taxing authorities or as tax escrow payments to a superior
mortgagee) in full or in monthly, quarterly, or other installments, on any other
date or dates than as presently required, then at Landlord's option, Tenant's
Tax Payments shall be correspondingly accelerated or revised so that said
Tenant's Tax Payments are due at least thirty (30) days prior to the date
payments are due to the taxing authorities or such superior mortgagee.
Notwithstanding anything to the contrary contained herein, Tenant shall not be
obligated to make Tenant's Tax Payment with respect to Taxes allocable to any
period prior to the Rent Commencement Date.
(b) If Landlord shall receive a refund of Taxes for
any Tax Year, Landlord shall pay to Tenant the amount of the net refund (after
deducting from such total refund the costs and expenses, including, but not
limited to, appraisal, accounting and legal fees of obtaining the same, to the
extent that such costs and expenses were not theretofore collected from Tenant
for such Tax Year); provided, however, such payment to Tenant shall in no event
exceed Tenant's Tax Payment paid for such Tax Year.
(c) (l) With respect to each and every Tax Year
during the term of this Lease which occurs in its entirety on or before the date
that is five (5) years prior to the Expiration Date (each such Tax Year being
herein referred to as a "Tenant-Controlled Tax Year") and as to which a Tenant's
Tax Payment is payable hereunder, it being understood and agreed that (A) if
Tenant exercises its option to renew the term of this Lease for the First
Extension Term, then, from and after the exercise of such option, the term
"Tenant-Controlled Tax Year" shall mean each and every Tax Year during the term
of this Lease as to which a Tenant's Tax Payment is payable hereunder which
occurs in its entirety on or before the date that is five (5) years prior to the
last day of the First Extension Term, and (B) if Tenant exercises its option to
renew the term of this Lease for the Second Extension Term, then, from and after
the exercise of such option, the term "Tenant-Controlled Tax Year" shall mean
each and every Tax Year during the term of this Lease as to which a Tenant's Tax
Payment is payable hereunder which occurs in its entirety on or before the date
that is five (5) years prior to the last day of the Second Extension Term).
Landlord shall, unless it receives Tenant's written consent (which consent shall
not be unreasonably withheld or delayed) to refrain from doing so or unless
Landlord receives the written advice from the Tax Representative [as such term
is defined in this Section 3.02(c)(l)]
25
that it would not be advisable or productive to bring or pursue such protest,
for such Tax Year, timely and properly file a protest with respect to the annual
assessment of the Real Property by the Department of Finance of the City of New
York and for such Tax Year. If Landlord is required to file such a protest
pursuant to the immediately preceding sentence and fails to do so within thirty
(30) days prior to the deadline for filing same, Tenant may notify Landlord
that, if such failure continues for an additional period of ten (10) days after
the giving of such notice, Tenant may file such protest, and, if such failure in
fact continues for ten (10) days after the giving of such notice, then Tenant
may file such protest, and Landlord agrees to cooperate with Tenant in
connection therewith. The certiorari lawyer, tax consultant or advisory service
selected to represent Landlord in connection with any certiorari proceedings
pursuant to this Section 3.02(c) (herein called the "Tax Representative") shall
be selected by Tenant, subject to Landlord's consent, which consent Landlord
shall not unreasonably withhold or delay. The Tax Representative shall be a
recognized certiorari lawyer, tax consultant or advisory service with at least
ten (10) years experience in representing landlords in certiorari proceedings
with respect to office buildings in New York County. If, in Landlord's
reasonable judgment, a Tax Representative selected by Tenant [or the Tax
Representative described in the last sentence of this subsection 3.02(c)(l)]
should be replaced, Landlord shall have the right to give a notice to Tenant
(herein called a "Section 3.02 Notice") requiring Tenant to select a replacement
Tax Representative within ten (10) Business Days thereafter. If Tenant fails to
select a replacement Tax Representative within such ten (10) Business Day
period, Landlord shall have the right to select a replacement Tax
Representative. Any dispute with respect to the withholding of consent to the
selection or replacement of the Tax Representative by Landlord or Tenant or as
the result of the delivery of a Section 3.02 Notice shall be resolved by
Expedited Arbitration. Until such time that Tenant sends a notice to Landlord
selecting a Tax Representative, both Landlord and Tenant agree that Rosenman &
Colin LLP is an approved Tax Representative and shall represent Landlord in
certiorari proceedings filed for Tenant-Controlled Tax Years in accordance with
this Section 3.02.
(2) With respect to each Tenant-Controlled Tax Year:
(i) Tenant shall have the immediate right to control,
upon notice to Landlord thereof the certiorari proceedings and the Tax
Representative shall report to Tenant;
(ii) Landlord shall have the right to retain its own
certiorari lawyer, tax consultant or advisory service (herein called "Landlord's
Additional Tax Advisor") at Landlord's expense and not reimbursable by Tenant;
(iii) Landlord's Additional Tax Advisor shall have
the right to participate in discussions with the Tax Assessor's Office and in
the certiorari proceedings
26
for each Tenant-Controlled Tax Year (at Landlord's expense and not reimbursable
by Tenant), but shall not have the right to file a separate protest or appeal or
enter into a settlement for any Tenant-Controlled Tax Year; and
(iv) Tenant shall have the sole right to settle the
certiorari proceedings for any Tenant-Controlled Tax Year; provided, however,
that (A) Tenant shall not agree to a Real Property assessment amount nor agree
to settle the certiorari proceedings for any Tenant-Controlled Tax Year without
Landlord's prior written consent, which consent Landlord shall not unreasonably
withhold or delay, (B) Tenant shall not have the right to agree to a Real
Property assessment amount nor agree to settle a certiorari proceeding with
respect to any Tax Year that is not a Tenant-Controlled Tax Year.
(3) In the event that Landlord shall withhold its consent to a
settlement of a certiorari proceeding for a Tenant-Controlled Tax Year (the
amount of the proposed settlement being herein referred to as the "Settlement
Amount"), then:
(i) Landlord shall take over the control of the
certiorari proceeding in question, and
(ii) Landlord shall be responsible, at its sole cost
and expense, for the excess, if any, of the amount of the Taxes as finally
determined for the Tax Year in question over the Settlement Amount.
(4) With respect to any Tax Year as to which a Tenant's Tax
Payment is payable hereunder and that is not a Tenant-Controlled Tax Year,
Landlord shall timely and properly file and thereafter prosecute a protest with
espect to the annual assessment of the Real Property by the Department of
Finance of the City of New York and for such Tax Year, unless it receives
Tenant's written consent (which consent shall not be unreasonably withheld or
delayed) to refrain from doing so or unless Landlord receives the written advice
from the Tax Representative that it would not be advisable or productive to
bring or pursue such protest. Tenant, for itself and its immediate and remote
subtenants and successors in interest hereunder, hereby waives, to the extent
permitted by law, any right Tenant may now or in the future have to protest or
contest any Taxes or to bring any application or proceeding seeking a reduction
in Taxes or assessed valuation with respect to any Tax Year that is not a
Tenant-Controlled Tax Year, or otherwise challenging the determination thereof.
(d) In respect of any Tax Year which begins prior to the Rent
Commencement Date, or terminates after the Expiration Date, the Tax Payment in
respect of each such Tax Year or tax refund pursuant to subdivision (b) above
therefor shall be prorated accordingly.
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(e) Tenant shall pay to Landlord within twenty (20) days after
being billed therefor, any reasonable expenses incurred by Landlord in
contesting any items comprising Taxes and/or the assessed value of the Real
Property where Landlord is required or permitted to do so hereunder, but Tenant
shall not be responsible for the fees and expenses of Landlord's Additional Tax
Advisor in any Tenant Controlled Tax Year during which Tenant is complying with
its obligations hereunder to file and pursue a tax protest.
3.03. (a) For each Operating Year, Tenant shall pay an amount (herein
called "Operating Payment") equal to one hundred (100%) percent of the Operating
Expenses for such Operating Year. Notwithstanding anything to the contrary
contained herein, Tenant shall not be obligated to make an Operating Payment
with respect to Operating Expenses allocable to any period prior to the Rent
Commencement Date (the period between the Commencement Date and the Rent
Commencement Date being herein sometimes referred to as the "Operating Expense
Abatement Period"); provided, however, that Tenant shall remain obligated to pay
for (i) all electricity consumed in the Premises during the Operating Expense
Abatement Period in accordance with Article 14 hereof, and (ii) all other costs
and expenses which would otherwise constitute Operating Expenses and which are
incurred to furnish HVAC, water, sewer other utilities and elevator service to
the Premises during the Operating Expense Abatement Period. Notwithstanding the
foregoing, Tenant shall not be obligated (except as hereinafter provided) to pay
for additional labor charges incurred by Landlord during the Operating Expense
Abatement Period, if any, by reason of the fact that the Building Systems, or
any of them, have not been fully commissioned or are providing service under a
temporary permit.
(b) Landlord shall furnish to Tenant, prior to the
commencement of or within ninety (90) days after the commencement of each
Operating Year, a written statement setting forth in reasonable detail
Landlord's reasonable estimate of the Operating Payment for such Operating Year,
which shall be based upon the annual budget for such Operating Year prepared
pursuant to the Management Agreement. Tenant shall pay to Landlord on the first
day of each month during the Operating Year in which the Operating Payment will
be due (but not earlier than the date which is 20 days following delivery of
Landlord's estimate pursuant to the preceding sentence), an amount equal to
one-twelfth (1/12th) of Landlord's reasonable estimate of the Operating Payment
for such Operating Year. If Landlord shall not furnish any such estimate for an
Operating Year or if Landlord shall furnish any such estimate for an Operating
Year subsequent to the commencement-thereof, then (i) until the first day of the
month following the date which is twenty (20) days after such estimate is
furnished to Tenant, Tenant shall pay to Landlord on the first day of each
month an amount equal to the monthly sum payable by Tenant to Landlord under
this Article 3 in respect of the last month of the preceding Operating Year;
(ii) after such estimate is furnished to Tenant, Landlord shall give notice to
Tenant stating whether the installments of the Operating Payment previously made
for such Operating Year were greater or less than the installments of the
Operating Payment to be made for the Operating
28
Year in which the Operating Payment will be due in accordance with such
estimate, and (A) if there shall be a deficiency, Tenant shall pay the amount
thereof within twenty (20) days after demand therefor, or (B) if there shall
have been an overpayment, Landlord shall within twenty (20) days of such notice
refund to Tenant the amount thereof; and (iii) on the first day of the month
following the month in which such estimate is furnished to Tenant (but if such
first day of the month is not at least twenty (20) days after such estimate was
delivered to Tenant, then on the first day of the following month) and monthly
thereafter throughout the remainder of such Operating Year Tenant shall pay to
Landlord an amount equal to one-twelfth (1/12th) of the Operating Payment shown
on such estimate. Landlord may, but not more than twice during any Operating
Year, furnish to Tenant a revised statement of Landlord's reasonable estimate of
the Operating Payment for such Operating Year, and in such case, the Operating
Payment for such Operating Year shall be adjusted and paid or refunded or
credited as the case may be, substantially in the same manner as provided in the
preceding sentence.
(c) Landlord shall furnish to Tenant a Operating Statement for
each Operating Year within one hundred eighty (180) days after the end of each
Operating Year. Such statement shall set forth in reasonable detail the
Operating Expenses for such Operating Year. If the Operating Statement shall
show that the sums paid by Tenant, if any, under subsection 3.03(b) exceeded the
Operating Payment to be paid by Tenant for the Operating Year for which such
Operating Statement is furnished, Landlord shall refund to Tenant the amount of
such excess; and if the Operating Statement for such Operating Year shall show
that the sums so paid by Tenant were less than the Operating Payment to be paid
by Tenant for such Operating Year, Tenant shall pay the amount of such
deficiency within twenty (20) days after demand therefor.
(d) (i) Tenant, upon reasonable notice given within ninety (90)
days of the receipt of any Operating Statement (including, without limitation,
any revised Operating Statement), may elect to have Tenant's designated (in such
notice) Certified Public Accountant (who may be an employee of Tenant) examine
such of Landlord's books and records (collectively "Records") as are directly
relevant to the Operating Statement in question, together with reasonable
supporting data therefor, such examination to take place at an office designated
by Landlord in Manhattan. Landlord agrees to maintain customary books and
records (or to cause the Manager to maintain customary books and records)
relating to Operating Expenses. In making such examination, Tenant agrees, and
shall cause its designated Certified Public Accountant to agree, to keep
confidential (i) any and all information contained in such Records and not
otherwise known to Tenant or such Certified Public Accountant through a
non-confidential source, and (ii) the circumstances and details pertaining to
such examination and any dispute or settlement between Landlord and Tenant
arising out of such examination, except (A) as may be required by applicable
Legal Requirements or (B) as may be required by a court of competent
jurisdiction or arbitrator or in connection with any action or proceeding before
a court of competent jurisdiction or arbitrator, or (C) to Tenant's attorneys
accountants and other
29
professionals; and Tenant will confirm and cause its Certified Public Accountant
to confirm such agreement in a separate written agreement, if requested by
Landlord. If Tenant shall not give such notice within such ninety (90) day
period, then the Operating Statement as furnished by Landlord shall be
conclusive and binding upon Tenant. Tenant shall, at Tenant's expense, have the
right to obtain copies and/or make abstracts of the Records as it may request in
connection with its verification of any such Operating Statement, subject to the
foregoing confidentiality provisions.
(ii) In the event that Tenant, after having
reasonable opportunity to examine the Records (but in no event more than
one-hundred fifty (150) days from the date on which the Records are made
available to Tenant), shall disagree with the Operating Statement, then Tenant
may send a written notice ("Tenant's Statement") to Landlord of such
disagreement, specifying in reasonable detail the basis for Tenant's
disagreement and the amount of the Operating Payment Tenant claims is due.
Landlord and Tenant shall attempt to resolve such disagreement. If they are
unable to do so within thirty (30) days, Landlord and Tenant shall designate a
Certified Public Accountant which has not previously performed services for
either Landlord or Tenant (the "Arbiter") whose determination made in accordance
with this subsection 3.03(d)(ii) shall be binding upon the parties. If the
determination of Arbiter shall substantially confirm the determination of
Landlord, then Tenant shall pay the cost of the Arbiter. If the Arbiter shall
substantially confirm the determination of Tenant, then Landlord shall pay the
cost of the Arbiter. In all other events, the cost of the Arbiter shall be borne
equally by Landlord and Tenant. The Arbiter (a) shall be a member of an
independent certified public accounting firm having at least fifty (50)
accounting professionals, and (b) shall have at least ten (10) years of
experience in commercial real estate accounting. In the event that Landlord and
Tenant shall be unable to agree upon the designation of the Arbiter within
thirty (30) days after receipt of notice from the other party requesting
agreement as to the designation of the Arbiter, which notice shall contain the
names and addresses of two or more Certified Public Accountants who are
acceptable to the party sending such notice (any one of whom, if acceptable to
the party receiving such notice as shall be evidenced by notice given by the
receiving party to the other party within such thirty (30) day period, shall be
the agreed upon Arbiter), then either party shall have the right to request the
American Arbitration Association (the "AAA") (or any organization which is the
successor thereto) to designate as the Arbiter a Certified Public Accountant
whose determination made in accordance with this subsection 3.03(e)(ii) shall be
conclusive and binding upon the parties, and the cost charged by the AAA (or any
organization which is the successor thereto), for designating such Arbiter,
shall be shared equally by Landlord and Tenant. Landlord and Tenant hereby agree
that any determination made by an Arbiter designated pursuant to this subsection
3.03(e)(ii) shall not exceed the amount(s) as determined to be due in the first
instance by Operating Statement, nor shall such determination be less than the
amount(s) claimed to be due by Tenant in Tenant's Statement, and that any
determination which does not comply with the foregoing shall be null and void
and not binding on the parties. In rendering
30
such determination such Arbiter shall not add to, subtract from or otherwise
modify the provisions of this Lease, including, without limitation, the
immediately preceding sentence. Notwithstanding the foregoing provisions of this
section, Tenant, pending the resolution of any contest pursuant to the terms
hereof, shall continue to pay all sums as determined to be due in the first
instance by such Operating Statement and upon the resolution of such contest,
suitable adjustment shall be made in accordance therewith with, if such
resolution is that Tenant has overpaid Operating Expenses, appropriate credit
allowed Tenant against the next installment(s) of Fixed Rent and Additional
Charges becoming due hereunder, together with interest earned thereon from the
date paid by Tenant to the date refunded or credited to Tenant at the Interest
Rate, or, if there are no further payments of Fixed Rent payable hereunder,
i.e., at the end of the term of this Lease, the amount of such credit including
interest as aforesaid shall be refunded to Tenant within twenty (20) days
following the resolution of such contest.
3.04. (a) In any case provided in this Article 3 in which Tenant
is entitled to a refund, Landlord shall credit against the next due installments
of Fixed Rent and Additional Charges any amounts to which Tenant shall be
entitled, including interest where expressly provided for in this Article 3.
Nothing in this Article 3 shall be construed so as to result in a decrease in
the Fixed Rent hereunder. If this Lease shall expire before any such credit
shall have been fully applied, then Landlord shall refund to Tenant the
unapplied balance of such credit (provided Tenant is not in default hereunder
beyond any applicable notice and grace periods, but Landlord's obligation to
make such refund shall be reinstated if such default is subsequently cured by
Tenant, it being acknowledged that the foregoing shall not be deemed to extend
the time for performance or any cure period provided for in this Lease).
(b) Subject to Section 3.05 hereof, the expiration or
termination of this Lease shall not affect the rights or obligations of the
parties hereto respecting any payment pursuant to this Article 3, and any
Operating Statement or tax xxxx, as the case may be, for any Tax Year or
Operating Year may be sent to Tenant subsequent to, and all such rights and
obligations shall survive, any such expiration or termination. Any payments due
under such Operating Statement or tax xxxx, as the case may be, shall be payable
within twenty (20) days after such statement or xxxx is sent to Tenant.
3.05. (a) Landlord's failure to render or delay in rendering a
Operating Statement with respect to any Operating Year or any component of the
Operating Payment shall not prejudice Landlord's right to thereafter render a
Operating Statement with respect to any such Operating Year or any such
component, nor shall the rendering of a Operating Statement for any Operating
Year prejudice Landlord's right to thereafter render a corrected Operating
Statement for such Operating Year. Landlord's failure to render or delay in
rendering a xxxx with respect to any installment of Taxes shall not prejudice
Landlord's right to thereafter render such a xxxx for such installment, nor
shall the rendering of a xxxx for any installment prejudice Landlord's right to
31
thereafter render a corrected xxxx for such installment. Notwithstanding
anything to the contrary contained in this Lease in the event Landlord fails to
give or correct a final Operating Statement for Operating Expenses or a final
xxxx for Taxes to Tenant for any Tax Year or Operating Year, as the case may be,
on or before the date which is two (2) years after the Expiration Date or
earlier date of termination of this Lease (or two (2) years after such later
date as the information required to calculate such final Operating Statement or
xxxx is reasonably available to Landlord), then Landlord shall be deemed to
have waived the payment of any then unpaid Additional Charges which would have
been due pursuant to said Operating Statement or xxxx for Taxes, or which would
have been due pursuant to any amended Operating Statement or xxxx for Taxes, for
such Operating Year or Tax Year, as the case may be. In addition,
(A) in the event Landlord fails to give or
correct a final Operating Statement for
Operating Expenses or a final xxxx for Taxes
to Tenant for any Operating Year or Tax
Year, as the case may be, on or before the
date which is two (2) years after the end of
such Operating year or Tax Year (or two (2)
years after such later date as the
information required to calculate such final
Operating Statement or xxxx for Taxes is
reasonably available to Landlord) (the later
of such 2 dates being herein referred to as
an "Outside Billing Date"), then Landlord
shall be deemed to have waived the payment
of any then unpaid Additional Charges which
would have been due pursuant to said
Operating Statement or xxxx for Taxes, or
which would have been due pursuant to any
amended Operating Statement or xxxx for
Taxes, for such Operating Year or Tax Year,
as the case may be, provided and on
condition that (X) Tenant shall have sent to
Landlord a notice following the Outside
Billing Date expressly referring to this
Section 3.05 and stating that if Landlord
fails to render such final Operating
Statement or xxxx for Taxes within thirty
(30) days after the giving of such notice,
Landlord shall be deemed to have waived such
payment (herein called a "Reminder Notice"),
and (Y) Landlord shall have failed to
deliver such final Operating Statement or
xxxx for Taxes within such thirty (30) day
period; and
(B) in the event Landlord fails to give or
correct a final Operating Statement for
Operating Expenses or a final xxxx for Taxes
to Tenant for any Operating Year or Tax
Year, as the case may be, on or before the
date which is six (6) years after the end of
such Operating Year or Tax Year (or, in the
case of a xxxx for Taxes, six (6) years
after such later date as the information
required to
32
calculate such final xxxx for Taxes is
reasonably available to Landlord), then
Landlord shall be deemed to have waived the
payment of any then unpaid Additional
Charges which would have been due pursuant
to said Operating Statement or xxxx for
Taxes, or which would have been due pursuant
to any amended Operating Statement or xxxx
for Taxes, as the case may be, without the
requirement of the giving of a Reminder
Notice by Tenant.
3.06. With respect to any amount which Landlord is required to
pay or refund to Tenant under this Article 3 on account of Tenant's Tax Payment
or Operating Payment, in the event Landlord has failed to pay or refund such
amount to Tenant when due hereunder, Tenant may notify Landlord in writing of
such fact, which notice shall specify in reasonable detail the nature and amount
of the payment which Tenant believes is due (herein called a "Section 3.06
Default Notice"), a copy of which Section 3.06 Default Notice shall be delivered
simultaneously to any Superior Lessor or Superior Mortgagee whose name and
address shall have previously have been furnished to Tenant. If Landlord fails
to pay or refund the amount set forth in a Section 3.06 Default Notice within
ten (10) days after delivery to Landlord thereof, then Tenant may give Landlord
a second notice which shall specify Tenant's intention to exercise Tenant's
offset right under this Section 3.06 and shall state that Landlord has a period
of ten (10) days following the giving of such notice to dispute Tenant's right
to exercise its offset right (herein called a "Section 3.06 Offset Notice"), a
copy of which Section 3.06 Offset Notice shall be delivered simultaneously to
any Superior Lessor or Superior Mortgagee whose name and address shall have
previously have been furnished to Tenant. If Landlord fails to pay or refund the
amount set forth in a Section 3.06 Offset Notice within five (5) Business Days
after delivery to Landlord thereof, then Tenant shall have the right to offset
against the next installment(s) of Fixed Rent thereafter payable hereunder the
amount set forth in the Section 3.06 Offset Notice, together with interest
thereon at the Interest Rate from the date such amount was originally payable to
Tenant until paid to or offset by Tenant, provided, however, that Tenant shall
not have the right to exercise the offset right set forth in this Section 3.06
if Landlord shall have notified Tenant in writing not later than ten (10) days
after the giving of the Section 3.06 Offset Notice that Landlord disputes the
payment in question unless and until (i) such dispute shall have been resolved
by Expedited Arbitration in favor of Tenant, and (ii) a final order reflecting
such arbitration award shall have been entered in a court of competent
jurisdiction. Landlord shall reimburse Tenant for any amounts due to Tenant
pursuant to such judgment within five (5) Business Days after the occurrence of
the events described in clauses (i) and (ii) of the immediately preceding
sentence, including interest at the Interest Rate on any such amounts from the
date originally paid by Tenant to the date fully reimbursed to Tenant, and in
the event Landlord fails to do so, Tenant may offset such amounts, together with
interest at the Interest Rate on any such amounts from the date originally paid
by Tenant to the date reimbursed to
33
Tenant, against the next installment(s) of Fixed Rent and Additional Charges
becoming due hereunder.
ARTICLE 4
Security
4.01. Tenant has deposited with Landlord either the Security
Letter (as such term is defined in Section 4.02 hereof) or the sum of Twelve
Million and 00/100 ($12,000,000.00) Dollars as security for the full and
faithful performance and observance by Tenant of Tenant's covenants and
obligations under this Lease. If Tenant defaults beyond notice and the
expiration of any applicable cure period, in the full and prompt payment and
performance of any of Tenant's covenants and obligations under this Lease,
including, but not limited to, the payment of Fixed Rent and Additional Charges,
Landlord may, but shall not be required to, use, apply or retain the whole or
any part of the security so deposited and the interest accrued thereon, if any,
to the extent required for the payment of any Fixed Rent and Additional Charges
or any other sums as to which Tenant is in default or for any sum which Landlord
may expend or may be required to expend by reason of Tenant's default in respect
of any of the terms, covenants and conditions of this Lease, including, but not
limited to, any damages or deficiency in the reletting of the Premises, whether
such damages or deficiency accrue before or after summary proceedings or other
re-entry by Landlord. If Landlord shall so use, apply or retain the whole or any
part of the security or the interest accrued therein, if any, Tenant shall upon
demand immediately deposit with Landlord a sum equal to the amount so used,
applied or retained (but not in excess of $12,000,000, as such amount may be
reduced from time to time as provided in Section 4.06 hereof), as security as
aforesaid failing which Landlord shall have the same rights and remedies as for
the non-payment of Fixed Rent beyond the applicable grace period. If Tenant
shall pay all Fixed Rent and Additional Charges due and payable under this Lease
and shall surrender the Premises to Landlord in accordance with the provisions
of this Lease, the security or any balance thereof, to which Tenant is entitled,
if same has not been previously returned to Tenant in accordance with the
provisions of Section 4.06 hereof, shall be returned or paid over to Tenant
after the date fixed as the end of this Lease and after delivery to Landlord of
entire possession of the Premises. In the event of a sale, transfer or leasing
of Landlord's interest in the Building whether or not in connection with a sale,
transfer or leasing of the Land to a vendee, transferee or lessee, Landlord
shall have the right to transfer the unapplied part of the security and the
interest thereon, if any, to which Tenant is entitled, to the vendee, transferee
or lessee and Landlord shall thereupon be released by Tenant from all liability
for the return or payment thereof, and Tenant shall look solely to the new
landlord for the return or payment of the same. The provisions of the preceding
sentence shall apply to every subsequent sale, transfer or leasing of the
Building, and any successor of Landlord shall, upon a sale, transfer, leasing or
other cessation of the interest of
34
such successors in the Building, whether in whole or in part, pay over any
unapplied part of said security to any vendee, transferee or lessee of the
Building and shall thereupon be relieved of all liability with respect thereto.
Except in connection with a permitted assignment of this Lease, Tenant shall not
assign or encumber or attempt to assign or encumber the monies deposited herein
as security or any interest thereon to which Tenant is entitled, and neither
Landlord nor its successors or assigns shall be bound by any such assignment,
encumbrance, attempted assignment or attempted encumbrance. In any event, in the
absence of evidence satisfactory to Landlord of an assignment of the right to
receive the security, or the remaining balance thereof, Landlord may return the
security to the original Tenant regardless of one or more assignments of this
Lease. If and to the extent that the security deposit is held in cash form
(including, without limitation, any proceeds from a drawing down of the Security
Letter which have not been applied to Tenant's obligations in accordance with
this Article 4), such cash shall be held in a segregated interest-bearing
account at a commercial bank licensed to do business in New York or in a
self-insured money market fund having assets of not less than $500,000,000. Any
interest earned on such account shall be remitted to Tenant annually.
4.02. In lieu of the cash security deposit provided for in
Section 4.01 hereof, Tenant may at any time during the term hereof deliver to
Landlord and shall thereafter, except as otherwise provided herein, maintain in
effect at all times during the term hereof, a clean, irrevocable letter of
credit, in form and substance substantially as set forth on Exhibit G-1 or
Exhibit G-2 annexed hereto (which, in each such case, may be amended after the
determination of the Rent Commencement Date solely for the purpose of stating
the actual effective dates for the reductions referred to in Section 4.06,
provided that the form of such amendment shall be delivered to and approved by
Landlord in draft form prior to its issuance, Landlord's approval not to be
unreasonably withheld or delayed), in the amount of the security required
pursuant to this Article 4, issued by a commercial bank reasonably satisfactory
to Landlord (Landlord hereby acknowledging that Bank of New York is satisfactory
for this purpose) and having its principal place of business or its duly
licensed branch or agency in the State of New York. Such letter of credit shall
have an expiration date no earlier than the first anniversary of the date of
issuance thereof and shall be automatically renewed from year to year unless
terminated by the issuer thereof by notice to Landlord given by certified or
registered mail, return receipt requested not less than sixty (60) days prior to
the expiration thereof. Except as otherwise provided in this Article 4, Tenant
shall, throughout the term of this Lease deliver to Landlord, in the event of
the termination of any such letter of credit, replacement letters of credit in
lieu thereof (each such letter of credit and such extensions or replacements
thereof, as the case may be, is hereinafter referred to as a "Security Letter")
no later than sixty (60) days prior to the expiration date of the preceding
Security Letter. The term of each such Security Letter shall be not less than
one (1) year and shall be automatically renewable from year to year as
aforesaid. If Tenant shall fail to obtain any replacements of a Security Letter
within the time limits set forth in this Section 4.02, Landlord may draw down
the full amount of the existing Security Letter and retain the same as
35
security hereunder. In the event Tenant furnishes Landlord with a Security
Letter which contains a final expiration date which will occur prior to the date
that the security deposit under this Article 4 shall be reduced to zero in
accordance with the schedule set forth in Section 4.06 hereof, Tenant shall
furnish Landlord with a replacement Security Letter, in form and substance
reasonably satisfactory to Landlord, within forty-five (45) days prior to the
final expiration date of Tenant's existing Security Letter, and if Tenant fails
to furnish such a replacement Security Letter in accordance with the foregoing,
Tenant shall be deemed to be in default hereunder and Landlord shall be entitled
to draw down the full amount of the existing Security Letter and retain such
amount as security hereunder in which event the proceeds thereof shall be
applied or held as cash security in accordance with the provisions of Section
4.01 hereof. At any time that Landlord is holding a Security Letter hereunder,
Tenant shall have the right to a return of such Security Letter upon delivery to
Landlord of a cash security deposit in the amount of the security then required
to be maintained under this Article 4 to be held by Landlord in accordance with
this Article 4, provided that Tenant shall give not less than five (5) Business
Days prior written notice to Landlord of such election to replace the Security
Letter with cash and provided further that until such cash security deposit is
delivered to Landlord, Landlord shall retain all of its rights under this
Article 4 to present and receive payment on such Security Letter. Tenant shall
have the right to substitute for any Security Letter then being held by Landlord
a substitute Security Letter which satisfies all of the requirements of this
Article 4, provided that Landlord shall not be obligated to relinquish the
Security Letter then being held by Landlord until such new Security Letter has
been delivered to Landlord.
4.03. In the event that Tenant defaults in respect of any of the
terms, provisions, covenants and conditions of this Lease beyond notice and the
expiration of any applicable cure period, and Landlord utilizes all or any part
of the security represented by the Security Letter but does not terminate this
Lease as provided in Article 22 hereof, Landlord may, in addition to exercising
its rights as provided in Section 4.01 hereof, retain the unapplied and unused
balance of the principal amount of the Security Letter as security for the
faithful performance and observance by Tenant thereafter of the terms,
provisions, and conditions of this Lease, and may use, apply, or retain the
whole or any part of said balance to the extent required for payment of Fixed
Rent, Additional Charges, or any other sums as to which Tenant is in default
after the giving of notice and the expiration of any applicable cure period or
for any sum which Landlord may expend or be required to expend by reason of
Tenant's default in respect of any of the terms, covenants, and conditions of
this Lease. In the event Landlord applies or retains any portion or all of the
security delivered hereunder, Tenant shall forthwith restore the amount so
applied or retained so that at all times the amount deposited shall be not less
than the security required by Article 4. If Tenant shall deliver a new Security
Letter to Landlord in the amount required hereunder to restore the security
deposit to the amount required by this Article 4 in accordance with the
foregoing, Landlord agrees to promptly return to Tenant any cash amount then
being held by Landlord as security hereunder.
36
4.04. In the event of a sale of the Building, Landlord shall have
the right to require Tenant to deliver a replacement Security Letter naming the
new Landlord as beneficiary and, if Tenant shall fail to timely deliver the same
within ten (10) Business Days after written request therefor, to draw down the
existing Security Letter and retain the proceeds as security hereunder until a
replacement Security Letter is delivered. Tenant hereby acknowledges and agrees
that in connection with any transfer by Landlord or its successors or assigns
hereunder of Landlord's interest in the Security Letter delivered by Tenant
pursuant to this Article 4, Tenant shall be solely liable to pay any transfer
fees charged by the issuing bank to Landlord or the transferee in connection
with any such transfer of the Security Letter, as Additional Charges hereunder,
within twenty (20) days after delivery to Tenant of an invoice therefor, but
Tenant shall not be responsible for such transfer fees (i) if the transferee is
an Affiliate (as such term is defined in Section 44.06 hereof) of Landlord, or
(ii) for more than one transfer in any two (2) year period.
4.05. Provided and on condition that Tenant is not then in
default, after notice and the expiration of any applicable cure period, with
respect to any of the terms, provisions, covenants and conditions of this Lease
on its part to be performed, then Landlord agrees that the amount of the
security deposit required pursuant to this Article 4 hereof shall be reduced
automatically in accordance with the following schedule:
(i) from and after the first anniversary of the Rent Commencement
Date, the amount of the security deposit shall be reduced by
$2,400,000.00, to $9,600,000.00;
(ii) from and after the second anniversary of the Rent Commencement
Date, the amount of the security deposit shall be further
reduced by $2,400,000.00, to $7,200,000.00;
(iii) from and after the third anniversary of the Rent Commencement
Date, the amount of the security deposit shall be further
reduced by $2,400,000.00, to $4,800,000.00;
(iv) from and after the fourth anniversary of the Rent Commencement
Date, the amount of the security deposit shall be further
reduced by $2,400,000.00, to $2,400,000.00; and
(v) from and after the fifth anniversary of the Rent Commencement
Date, the amount of the security deposit shall be reduced to
$0, and any remaining security including any interest accrued
thereon, shall be returned to Tenant.
37
If Tenant is not entitled to a reduction of the security deposit on any of
foregoing dates by reason of Tenant then being in default under this Lease after
the giving of notice and the expiration of any applicable cure period as
hereinabove provided, then provided Landlord has not terminated this Lease by
reason of such default or applied the security deposit (or a portion thereof in
excess of the applicable reduction), Tenant's right to have the amount of the
security deposit reduced pursuant to this Section 4.05 shall be reinstated upon
Tenant's cure of such default.
ARTICLE 5
Subordination, Notice to Superior Lessors and Mortgagees
5.01. Subject to the provisions of Section 5.05 hereof, this
Lease, and all rights of Tenant hereunder, are and shall be subject and
subordinate to all ground leases, overriding leases and underlying leases of the
Land and/or the Building hereafter existing and to all mortgages which may
hereafter affect the Land and/or the Building and/or any of such leases, whether
or not such mortgages shall also cover other lands and/or buildings and/or
leases, to each and every advance made or hereafter to be made under such
mortgages, and to all renewals, modifications, replacements and extensions of
such leases and such mortgages and spreaders and consolidations of such
mortgages. This Section 5.01 shall be self-operative and no further instrument
of subordination shall be required. In confirmation of such subordination,
Tenant shall promptly execute, acknowledge and deliver any instrument that
Landlord, the lessor under any such lease or the holder of any such mortgage or
any of their respective successors in interest may reasonably request solely to
evidence such subordination. Any lease to which this Lease is, at the time
referred to, subject and subordinate is herein called "Superior Lease" and the
lessor of a Superior Lease or its successor in interest, at the time referred
to, is herein called "Superior Lessor"; and any mortgage to which this Lease is,
at the time referred to, subject and subordinate is herein called "Superior
Mortgage" and the holder of a Superior Mortgage is herein called "Superior
Mortgagee."
5.02. Subject to the provisions of any SNDA (as such term is
defined in Section 5.05 hereof), if any act or omission of Landlord would give
Tenant the right, immediately or after lapse of a period of time, to cancel or
terminate this Lease (other than a termination of this Lease by reason of fire
or other casualty or condemnation pursuant to Article 19 or 20 hereof, as the
case may be), or to claim a partial or total eviction, Tenant shall not exercise
such right (a) until it has given written notice of such act or omission to
Landlord and each Superior Mortgagee and each Superior Lessor whose name and
address shall previously have been furnished to Tenant, and (b) until a
reasonable period for remedying such act or omission shall have elapsed
following the giving of such notice and following the time when such Superior
Mortgagee or Superior Lessor shall have become entitled under such Superior
Mortgage or Superior Lease, as the case
38
may be, to remedy the same (which reasonable period shall in no event be less
than the period to which Landlord would be entitled under this Lease or
otherwise, after similar notice, to effect such remedy), provided such Superior
Mortgagee or Superior Lessor shall with due diligence give Tenant notice of its
agreement to, and commence and continue to, remedy such act or omission.
5.03. Subject to the provisions of any SNDA, if any Superior
Lessor or Superior Mortgagee, or any designee of any Superior Lessor or Superior
Mortgagee, shall succeed to the rights of Landlord under this Lease, whether
through possession or foreclosure action or delivery of a new lease or deed,
then at the request of such party so succeeding to Landlord's rights (herein
called "Successor Landlord") and upon such Successor Landlord's written
agreement to accept Tenant's attornment and to recognize Tenant under the
then-executory terms of this Lease, Tenant shall attorn to and recognize such
Successor Landlord as Tenant's landlord under this Lease and shall promptly
execute and deliver any instrument that such Successor Landlord may reasonably
request solely to evidence such attornment. Upon such attornment this Lease
shall continue in full force and effect as a direct lease between the Successor
Landlord and Tenant upon all of the terms, conditions and covenants as are set
forth in this Lease, except that the Successor Landlord shall not be:
(a) liable for any previous act or omission of Landlord (or
its predecessors in interest), but the foregoing shall not relieve such
Successor Landlord from the obligation to provide services or perform repairs
or, subject to the provisions of subparagraphs 5.03(b), (c), (d), (e), (f), (g),
(h), or (i) hereof, any other obligations of Landlord provided for under this
Lease which obligations continue or are to be performed after the date such
Successor Landlord succeeds to the interest of Landlord under this Lease;
(b) responsible for any monies owing by Landlord to the credit
of Tenant, other than the Work Allowance and the Additional Tenant Work
Allowance (as such terms are defined in Article 38 hereof);
(c) subject to any credits, offsets (other than offset rights
expressly provided for in this Lease, provided that Tenant shall have complied
with its obligations under this Lease to provide notices to the Superior
Mortgagee or Superior Lessor in question regarding the exercise of such offset
rights, including, without limitation, any notices required to be given under
this Lease to such Superior Mortgagee or Superior Lessor regarding the default
on the part of Landlord and/or the exercise of self-help rights by Tenant which
gives rise to such offset rights), claims, counterclaims, demands or defenses
which Tenant may have against Landlord (or its predecessors in interest);
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(d) bound by any payments of rent which Tenant might have made
for more than one (1) month in advance of the date such payment is due under
this Lease to Landlord (or its predecessors in interest);
(e) bound by any covenant to undertake or complete any
construction of the Premises or any portion thereof, other than the Building
Work;
(f) required to account for any security deposit other than
any security deposit actually delivered to the Successor Landlord;
(g) bound by any obligation to make any payment to Tenant
(other than the Work Allowance and the Building Work Allowance) or grant or be
subject to any credits or offsets, except for credits or offsets expressly
provided for in this Lease, it being expressly understood, however, that the
Successor Landlord shall not be bound by an obligation to make payment to Tenant
with respect to construction performed by or on behalf of Tenant at the Premises
(other than the Work Allowance and the Building Work Allowance);
(h) bound by any modification of this Lease, including,
without limitation, any modification which reduces the Fixed Rent or Additional
Charges or other charges payable under this Lease, or shortens the term thereof,
or otherwise materially adversely affects the rights of the lessor thereunder,
made after the date that the Superior Lessor or Superior Mortgagor through whom
such Successor Landlord's interest arises first becomes a Superior Lessor or
Superior Mortgagor hereunder and written notice of such event has been delivered
to Tenant, without the written consent of the Successor Landlord; or
(i) required to remove any person occupying the Premises or
any part thereof.
5.04. Landlord hereby warrants and represents that, as of the
date of this Lease, there are no Superior Leases or Superior Mortgages affecting
any portion of the Real Property.
5.05. (a) With respect to future Superior Mortgages and future
Superior Leases, the provisions of Section 5.01 hereof shall be conditioned upon
the execution and delivery by and between Tenant and any such Superior
Mortgagee or Superior Lessor of a Subordination, Non-Disturbance and Attornment
Agreement (herein called an "SNDA") substantially in the form annexed hereto as
Exhibit H-1 in the case of a future Superior Mortgage or Exhibit H-2 in the case
of a future Superior Lease, with such modifications to such forms as may be
required by such Superior Mortgagee or Superior Lessor, as the case may be,
provided such modifications are of a ministerial nature or do not reduce the
rights of Tenant or increase the obligations of Tenant under such Exhibits H-1
or H-2, as the case may be, prior to such
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modifications. Tenant agrees to execute such SNDA's and return same to Landlord
within twenty (20) days after Landlord's written request therefor (herein called
the "SNDA Request"), provided that such SNDA Request is given in the manner
provided in Subsection 5.06(b) below. If Tenant shall fail to execute,
acknowledge and return any such SNDA's within such 20-day period, Landlord shall
have the right to send to Tenant a follow-up notice (herein called the "SNDA
Follow-up") and, provided that such SNDA Follow-up is given in the manner
provided in Subsection 5.05(b) below, if Tenant shall fail to execute,
acknowledge and return any such SNDA's within five (5) days after the giving of
the SNDA Follow-up, then (x) the provisions of Sections 5.01, 5.02 and 5.03
shall apply and (y) this Lease shall be subject and subordinate to such future
Superior Mortgages or future Superior Leases, as the case may be. Any dispute by
Tenant that the form of non-disturbance agreement utilized by the Superior
Lessor or the Superior Mortgagee does not afford Tenant substantially the same
rights and protections as does the applicable forms annexed hereto as Exhibit
H-1 or H-2, as the case may be, shall be resolved by Expedited Arbitration,
provided Tenant shall notify Landlord in writing of any such dispute within
twenty (20) days of Tenant's receipt of such form of non-disturbance agreement.
(b) In order to be effective, the SNDA Request and the SNDA
Follow-up must: (i) specifically refer to the provisions of Subsection 5.05(a)
hereof with respect to the failure of Tenant to execute, acknowledge and return
any such SNDA's within five (5) days after the giving of the SNDA Follow-up and
(ii) be given in accordance with the provisions of Section 29.01 hereof
ARTICLE 6
Quiet Enjoyment
6.01. Landlord covenants that during the term of this Lease
Tenant shall have quiet and peaceable possession of the Premises, without
hindrance or molestation by Landlord or any person claiming through or under
Landlord, subject to the terms, covenants, conditions and provisions of this
Lease.
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ARTICLE 7
Assignment, Subletting and Mortgaging
7.01. Subject to the rights of Tenant set forth in the following
Sections of this Article 7, Tenant shall not, whether voluntarily,
involuntarily, or by operation of law or otherwise (a) assign in whole or in
part or otherwise transfer in whole or in part this Lease or the term and estate
hereby granted, (b) sublet the Premises or any part thereof, or allow the same
to be used, occupied or utilized by anyone other than Tenant and Tenant's
Affiliates (as such term is defined in Section 7.02 hereof), (c) except as
provided in Article 45 hereof, mortgage, pledge, encumber or otherwise
hypothecate this Lease or the Premises or any part thereof in any manner
whatsoever, or (d) permit the Premises or any part thereof to be occupied, or
used for desk space, mailing privileges or otherwise, by any person other than
Tenant, without in each instance obtaining the prior written consent of Landlord
(which consent shall be granted or withheld in accordance with the following
provisions of this Article 7).
7.02. If Tenant (or any subtenant) is a corporation, the
provisions of subdivision (a) of Section 7.01 shall apply to a transfer, whether
by a single transaction or by a series of related or unrelated transactions, of
stock (other than a transfer though the "over the counter market" or through any
recognized stock exchange by persons who are not deemed "insiders" within the
meaning of the Securities Exchange Act of 1934, as amended) or any other
mechanism, such as the issuance of additional stock, a stock voting agreement or
change in class(es) of stock, which results in a change of control of Tenant (or
such subtenant) as if such transfer of stock or other mechanism which results in
a change of control of Tenant (or such subtenant) were an assignment of this
Lease, and if Tenant (or such subtenant) is a partnership or joint venture or
limited liability company (herein called an "LLC"), said provisions shall apply
with respect to a transfer, by one or more transfers, of an interest in the
distributions of profits and losses of such partnership or joint venture or LLC
(or other mechanism, such as the creation of additional general partnership or
limited partnership or LLC interests) which results in a change of control of
such partnership or joint venture or LLC, as if such transfer of an interest in
the distributions of profits and losses of such partnership or joint venture or
LLC which results in a change of control of such partnership or joint venture or
LLC were an assignment of this Lease; provided, however, the provisions of
subdivision (a), (b) or (d) of Section 7.01 shall not apply to any of the
transactions or other mechanisms referred to in this Section 7.02 (herein called
"Section 7.02 Transactions"), including, without limitation, any transactions
with a corporation into or with which Tenant (or any permitted subtenant of
Tenant) is merged or consolidated or to transactions with a corporation or
partnership or LLC to which substantially all of Tenant's assets are transferred
or to any corporation (herein collectively called "Tenant's Affiliates") which
controls or is controlled by Tenant or is under common control with Tenant,
provided that in any of such Section 7.02 Transactions:
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(i) the entity which is the Tenant hereunder immediately following
such Section 7.02 Transaction has a net worth computed in
accordance with GAAP at least equal to the lesser of (A) the
net worth computed in accordance with GAAP of Tenant as of the
date which is ninety (90) days prior to the consummation of
the transaction in question, or (B) the Base Net Worth (as
such term is defined in this Section 7.02);
(ii) proof of compliance with the net worth requirements of clause
(i) of this Section 7.02, consisting of an unqualified
certificate of Tenant's chief financial officer as to such
compliance accompanied by copies of the then most current
financial statements available for Tenant and such transferee
or successor, shall have been delivered to Landlord at least
ten (10) days prior to the effective date of any such
transaction;
(iii) a duplicate original instrument of assignment in form and
substance reasonably satisfactory to Landlord duly executed by
Tenant, shall have been delivered to Landlord at least ten
(10) days prior to the effective date of any such transaction
(provided, however, that if such assignment has not been
executed as of the 10th day prior to such effective date, the
form of such assignment which Tenant then reasonably expects
will be executed, which shall be in form and substance
reasonably satisfactory to Landlord, shall be delivered on or
before such 10th day and the actual executed assignment in
substantially the same form shall be delivered to Landlord
promptly following its execution and in any event on or prior
to the effective date thereof);
(iv) an instrument in form and substance reasonably satisfactory to
Landlord (and Landlord agrees that the form annexed hereto as
Exhibit K shall be satisfactory for this purpose), duly
executed by the assignee, in which such assignee assumes (as
of the Commencement Date) observance and performance of, and
agrees to be personally bound by, all of the terms, covenants
and conditions of this Lease on Tenant's part to be performed
and observed shall have been delivered to Landlord at least
ten (10) days prior to the effective date of any such
transaction (provided, however, that if such assumption
instrument has not been executed as of the 10th day prior to
such effective date, the form of such assumption instrument
which Tenant then reasonably expects will be executed, which
shall be in the form of Exhibit K attached hereto or otherwise
in form and substance reasonably satisfactory to Landlord,
shall be delivered on or before such 10th day and the actual
executed assumption instrument in substantially the same form
shall be delivered to Landlord promptly following its
execution and in any event on or prior to the effective date
thereof); and
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(v) such merger, consolidation or transfer shall be for a
good business purpose and not principally for the
purpose of transferring this Lease.
Notwithstanding the provisions of the preceding sentence to
the contrary, the assignment and assumption instruments
referred to in clauses (iii) and (iv) of the preceding
sentence shall not be required in the case of Section 7.02
Transactions in which the same entity which is the Tenant
under this Lease immediately prior to such Section 7.02
Transaction is the Tenant under this Lease immediately
following such Section 7.02 Transaction. In such instance, in
lieu of such assignment and assumption instruments, Tenant
shall deliver to Landlord an opinion of counsel (which may be
Tenant's in house general counsel opining in his or her
professional capacity) in form and substance reasonably
satisfactory to Landlord that, notwithstanding the occurrence
of the Section 7.02 Transaction, the Lease remains the legal,
valid, and binding obligation of Tenant, enforceable against
Tenant in accordance with its terms.
As used in this Lease, the term "Base Net Worth" shall mean
Three Hundred Million Dollars ($300,000,000), which
$300,000,000 amount shall be subject to increase from and
after the date of this Lease at the rate of increase, if any,
in the Consumer Price Index (as such term is defined in
Section 35.05 hereof).
Furthermore, the provisions of Section 7.01 shall not be deemed to prohibit the
simultaneous occupancy of the Office Premises and/or the Retail Premises by, or
a subletting of all or a portion of the Office Premises and/or the Retail
Premises to one or more Tenant's Affiliates or the assignment of this Lease on
one or more occasions to a Tenant's Affiliate; provided, however that (i)
Landlord shall be given not less than ten (10) days prior written notice of any
such assignment, sublease or occupancy arrangement accompanied by reasonable
evidence of such affiliate relationship, (ii) the cessation of such affiliate
relationship while such sublease or occupancy is continuing shall be deemed a
transaction to which all of the terms of this Article 7 shall apply, and (iii)
from and after any assignment of this Lease to a Tenant's Affiliate, any
transactions or other mechanisms involving the assignor which would otherwise
constitute Section 7.02 Transactions if same involved the assignee, shall also
constitute Section 7.02 Transactions. For purposes of this Section 7.02, the
term "control" shall mean, in the case of a corporation, ownership or voting
control, directly or indirectly, of at least fifty percent (50%) of all the
voting stock, and in case of a joint venture, partnership or LLC, or similar
entity, ownership, directly or indirectly, of at least fifty percent (50%) of
all the general or other partnership or membership (or similar) interests
therein. Any agreement pursuant to which (x) Tenant is relieved from the
obligation to pay, or a third party agrees to pay on Tenant's behalf, all or a
part of Fixed Rent or Additional Charges under this Lease, and/or (y) such third
party undertakes or is granted any right to assign or attempt to assign this
Lease or sublet or attempt to
44
sublet all or any portion of the Premises, shall be deemed an assignment of this
Lease and subject to the provisions of Section 7.01 and, if applicable, Section
7.02.
In the case of an assignment of this Lease to a Tenant's Affiliate,
Tenant shall, not less than ten (10) days prior to the effective date of any
such transaction, deliver to Landlord a guaranty of this Lease in the form
annexed hereto as Exhibit X duly executed by the assignor of the Lease, and from
and after the date of such transaction and for the balance of the term of this
Lease, Tenant shall deliver to Landlord within 90 days after the end of the
fiscal year for the assignor and assignee, respectively, the annual financial
statements of the assignor and assignee, which shall be audited if and to the
extent that the assignor and/or assignee prepare audited financial statements
for any purposes other than compliance with the provisions of this sentence.
7.03. If this Lease be assigned, whether or not in violation of
the provisions of this Lease, Landlord may collect rent from the assignee. If
the Premises or any part thereof are sublet or used or occupied by anybody other
than Tenant, whether or not in violation of this Lease, Landlord may, after
default by Tenant, after the giving of notice and the expiration of Tenant's
time to cure such default, collect rent from the subtenant or occupant. In
either event, Landlord shall apply the net amount collected to the Fixed Rent
and Additional Charges herein reserved, but no such assignment, subletting,
occupancy or collection shall be deemed a waiver of any of the provisions of
Section 7.01, or the acceptance of the assignee, subtenant or occupant as
tenant, or a release of Tenant from the performance by Tenant of Tenant's
obligations under this Lease. The consent by Landlord to a particular
assignment, mortgaging, subletting or use or occupancy by others shall not in
any way be considered a consent by Landlord to any other or further assignment,
mortgaging or subletting or use or occupancy by others not expressly permitted
by this Article 7.
7.04. Any assignment or transfer, whether made with Landlord's
consent pursuant to Sections 7.01 or 7.11 hereof or without Landlord's consent
pursuant to Section 7.02 hereof, shall be made only if, and shall not be
effective until, the assignee shall execute, acknowledge and deliver to Landlord
an agreement in form and substance reasonably satisfactory to Landlord (and the
form annexed hereto as Exhibit K is deemed reasonably satisfactory for this
purpose) whereby the assignee shall assume the obligations of this Lease on the
part of Tenant to be performed or observed and whereby the assignee shall agree
that the provisions in Section 7.01 shall, notwithstanding such assignment or
transfer, continue to be binding upon it in respect of all future assignments
and transfers. The original named Tenant covenants that, notwithstanding any
assignment or transfer, whether or not in violation of the provisions of this
Lease, and notwithstanding the acceptance of Fixed Rent and/or Additional
Charges by Landlord from an assignee, transferee, or any other party, the
original named Tenant shall remain fully liable for the payment of the Fixed
Rent and Additional Charges and for the performance and
45
observance of other obligations of this Lease on the part of Tenant to be
performed or observed, subject, however to the provisions of Section 7.05
hereof.
7.05. The joint and several liability of Tenant and any
immediate or remote successor in interest of Tenant and the due performance of
the obligations of this Lease on Tenant's part to be performed or observed shall
not be discharged, released or impaired in any respect by any agreement or
stipulation made by Landlord extending the time of, or modifying any of the
obligations of, this Lease, or by any waiver or failure of Landlord to enforce
any of the obligations of this Lease; provided, however that if any such
agreement or stipulation or modification or amendment to this Lease made between
or binding on Landlord and any immediate or remote successor in interest to
Tenant extends the term of this Lease or otherwise increases the obligations of
the tenant under this Lease, then the liability of any predecessor to the
assignee shall be no greater than if such agreement or stipulation or amendment
or modification had not been made.
7.06. The listing of any name other than that of Tenant,
whether on the doors of the Premises or the Building directory, or otherwise,
shall not operate to vest any right or interest in this Lease or in the
Premises, nor shall it be deemed to be the consent of Landlord to any assignment
or transfer of this Lease or to any sublease of the Premises or to the use or
occupancy thereof by others.
7.07. If Tenant shall at any time or times during the term of
this Lease desire to assign this Lease or sublet all or part of the Premises,
Tenant shall give notice thereof to Landlord, which notice shall set forth (i)
in the case of a proposed subletting, the area proposed to be sublet, and, in
the case of a proposed assignment, such notice shall set forth Tenant's
intention to assign this Lease, (ii) the term of the proposed subletting,
including the proposed dates of the commencement and the expiration of the term
of the proposed sublease or the effective date of the proposed assignment, as
the case may be, and (iii) the rents, work contributions, and all other material
provisions that are proposed to be included in the transaction, (iv) in
reasonable detail, the identity of the proposed assignee or subtenant, the
nature of its business and its proposed use of the Premises, (v) current
financial information with respect to the proposed assignee or subtenant,
including, without limitation, its most recent financial report, and (vi) such
other information as Landlord may reasonably request, and Landlord agrees to
make any such request for additional information to Tenant promptly after
receipt of the information listed in clauses (i) through (v) hereof.
7.08. (a) Provided that Tenant is not in default of any of
Tenant's obligations under this Lease after the giving of notice and the
expiration of any applicable cure period, Landlord's consent shall not be
required in the case of a proposed subletting of:
46
(x) all or any portion of the Retail Premises; or
(y) a portion of the Office Premises from time other
than a sublease covering more than 150,000 rentable
square feet;
(b) With respect to any proposed assignment of this Lease,
other than assignments of this Lease as to which Landlord's consent is not
required pursuant to Section 7.02 hereof, and with respect to any proposed
sublease, other than a sublease as to which Landlord's consent is not required
pursuant to Section 7.02 or Section 7.08(a) hereof, Landlord's consent (which
must be in writing and in form reasonably satisfactory to Landlord, and the
forms of consent annexed to this Lease as Exhibits Y-1 and Y-2, respectively,
shall be deemed to be reasonably satisfactory for this purpose) to the proposed
assignment or sublease shall not be unreasonably withheld or delayed, provided
and on condition that Tenant is not in default of any of Tenant's obligations
under this Lease after the giving of notice and the expiration of any applicable
cure period and further provided and upon condition that:
(1) Tenant shall have delivered to Landlord a
duplicate original of the sublease or
assignment instrument and all other
documents to be executed in connection
therewith;
(2) The proposed assignee or subtenant is
engaged in a business and the Premises, or
the relevant part thereof, will be used in a
manner which complies with the use
provisions of Article 2 hereof;
(3) The proposed assignee or subtenant has
sufficient financial worth considering the
responsibility involved, and Landlord has
been furnished with reasonable proof
thereof;
(4) The form of the proposed sublease shall
comply with the applicable provisions of
this Article 7; and
(5) Tenant shall reimburse Landlord on demand
for any reasonable costs that may be
incurred by Landlord in connection with said
assignment or sublease, including, without
limitation, the costs of making
investigations as to the acceptability of
the proposed assignee or subtenant, and
reasonable legal costs incurred in
connection with the granting of any
requested consent (not to exceed S2,500 for
any consent, which $2,500 amount shall be
subject to increase from and after the date
of this Lease at the rate of increase, if
any, in the Consumer Price Index.
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If Landlord shall fail to respond within twenty (20) days from the date Landlord
has received Tenant's request to approve or disapprove the proposed assignment
or sublease and all information required to be delivered by Tenant in connection
with such request for consent, then Tenant may give Landlord a notice (herein
called a "Deemed Approval Notice") that unless Landlord notifies Tenant in
writing within ten (10) days after delivery to Landlord of the Deemed Approval
Notice that Landlord approves or disapproves the proposed assignment or sublease
Landlord shall be deemed to have approved such assignment or sublease. In the
event Tenant so delivers a Deemed Approval Notice to Landlord, if Landlord fails
to notify Tenant in writing within ten (10) days after delivery to Landlord of
the Deemed Approval Notice that Landlord approves or disapproves the proposed
assignment or sublease, Landlord shall be deemed to have approved such
assignment or sublease. Any notice by Landlord disapproving an assignment or
sublease shall set forth in reasonable detail Landlord's reasons for
disapproving same.
7.09. With respect to each and every sublease or subletting
under the provisions of this Lease (whether or nor such sublease requires the
consent of Landlord), it is further agreed:
(a) No subletting shall be for a term
(including, without limitation, any renewal
or extension options contained in the
sublease) ending later than one day prior to
the expiration date of the term of this
Lease (including, without limitation, the
First Extension Term, if the First Extension
Option is exercised pursuant to Article 39
hereof, and the Second Extension Term, if
the Second Extension Option is exercised
pursuant to Article 40 hereof)
(b) No sublease shall be valid, and no subtenant
shall take possession of the Premises or any
part thereof, until an executed counterpart
of such sublease (and all ancillary
documents executed in connection with, with
respect to or modifying such sublease) has
been delivered to Landlord.
(c) Each sublease shall provide that it is
subject and subordinate to this Lease and to
any matters to which this Lease is or shall
be subordinate, and that in the event of
termination, reentry or dispossess by
Landlord under this Lease Landlord may, at
its option (subject to the provisions of any
non-disturbance agreement in effect between
Landlord and such subtenant), take over all
of the right, title and interest of Tenant,
as sublessor, under such sublease, and such
subtenant shall, at Landlord's option,
attorn to Landlord pursuant to the then
executory provisions of such sublease,
except that Landlord shall not be (i) liable
for any previous act or
48
omission of Tenant under such sublease, (ii)
subject to any credit, offset, claim,
counterclaim, demand or defense which such
subtenant may have against Tenant, (iii)
bound by any previous modification of such
sublease unless consented to in writing by
Landlord or by any previous prepayment of
more than one (1) month's rent except to the
extent such prepayment of rent was actually
received by Landlord, (iv) bound by any
covenant of Tenant to undertake or complete
any construction of the Premises or any
portion thereof, (v) required to account for
any security deposit of the subtenant other
than any security deposit actually delivered
to Landlord by Tenant, (vi) bound by any
obligation to make any payment to such
subtenant or grant any credits, except for
services, repairs, maintenance and
restoration provided for under the sublease
to be performed after the date of such
attornment, (vii) responsible for any monies
owing by Landlord to the credit of Tenant or
(viii) required to remove any person
occupying the Premises or any part thereof
(d) Each sublease shall provide that the
subtenant may not assign its rights
thereunder or further sublet the space
demised under the sublease, in whole or in
part, except in compliance with all of the
terms of provisions of this Article 7.
7.10. (a) If Landlord shall give its consent (or be deemed
pursuant to Section 7.08 to have given such consent) to any assignment of this
Lease, or if there shall at anytime during the term of this Lease be in effect
concurrently one or more subleases of the Office Premises (other than subleases
which are Section 7.02 Transactions) covering, in the aggregate, in excess of
150,000 rentable square feet, Tenant shall in consideration therefor, pay to
Landlord, as Additional Charges an amount equal to the fifty (50%) percent of
any Assignment Profit (as such term is defined in Section 7.10(b) hereof) or
Sublease Profit (as such term is defined in Section 7.10(c) hereof), as the case
may be. The provisions of this Section 7.10 shall not apply to (i) subleases of
the Retail Premises (or portions thereof), except that if a sublease covers both
Retail Premises and Office Premises, the subletting of any portion of the Office
Premises thereunder shall be subject to this Section 7.10, (ii) subleases of
Office Premises during any period when the aggregate portion of the Office
Premises covered by subleases is 150,000 rentable square feet or less, or (iii)
Section 7.02 Transactions.
(b) For purposes of this Section 7.10, the term
"Assignment Profit" shall mean an amount equal to all sums and other
considerations paid to Tenant by the assignee for or by reason of such
assignment (including, but not limited to, sums paid for the sale or rental
49
of Tenant's fixtures, leasehold improvements, equipment, furniture, furnishings
or other personal property, less, the then net unamortized or undepreciated
portion (determined on the basis of Tenant's federal income tax returns) of the
amount, if any, by which the original cost thereof exceeded any amounts paid for
or contributed by Landlord which were applied by Tenant against such-original
cost pursuant to the terms of this Lease); after deducting therefrom the amount
of Tenant's Costs (as such term is defined in Section 7.10(e) hereof).
(c) For purposes of this Section 7.10, the term
"Sublease Profit" shall mean, for any portion(s) of the term of this Lease (each
such portion of the term of this Lease being herein called a "Major Sublease
Period") during which there are in effect one or more subleases of the Office
Premises (other than subleases which are Section 7.02 Transactions) which, in
the aggregate, cover in excess of 150000 rentable square feet of the Office
Premises:
(i) the excess of (X) the aggregate of all rents,
additional charges or other consideration payable to
Tenant under all subleases in effect during the Major
Sublease Period (herein collectively called "Major
Subleases") with respect to all portions of the
Office Premises covered by such Major Subleases and
allocable to the Major Sublease Period, over (Y) the
Fixed Rent and Additional Charges accruing during the
Major Sublease Period in respect of such subleased
portions of the Office Premises (at the rate per
square foot payable by Tenant hereunder) pursuant to
the terms hereof, plus
(ii) all sums paid for the sale or rental of Tenant's
fixtures, leasehold improvements, equipment,
furniture or other personal property by the
subtenants under or in connection with the Major
Subleases, less the then net unamortized or
undepreciated portion (determined on the basis of
Tenant's federal income tax returns) of the amount,
if any, by which the original cost thereof exceeded
any amounts paid for or contributed by Landlord which
were applied by Tenant against such original cost
pursuant to the terms of this Lease), which net
unamortized amount shall be deducted from the sums
paid in connection with such subleases in equal
monthly installments over the balance of the term of
such subleases (each such monthly deduction to be in
an amount equal to the quotient of the net
unamortized amount, divided by the number of months
remaining in the term of this Lease), less
(iii) Tenant's Costs relating to the Major Subleases,
determined on the following basis: Tenant's Costs
for each Major Sublease shall be amortized over the
entire term of the applicable Major Sublease and the
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total portion of the amortization of such Tenant's
Costs for all Major Subleases allocable to the Major
Sublease Period shall be reimbursable to Tenant from
the first Sublease Profits for such Major Sublease
Period prior to any payments to Landlord of
Landlord's share of such Sublease Profits.
An example of the calculation of Sublease Profit in accordance with this Section
7.10 is annexed to this Lease as Exhibit Y.
(d) Subject to Section 7.10(c) hereof, the sums
payable under this Section 7.10 shall be paid to Landlord as and when paid by
the assignee or subtenant to Tenant.
(e) For purposes of this Section 7.10, the term
"Tenant's Cost" shall mean the reasonable expenses actually incurred by Tenant
in connection with the assignment and subletting in question for gains and
transfer taxes, brokerage commissions, advertising expenses, attorneys' fees,
any reasonable rent credit or concession or work allowance, any lease buyout
payments made by Tenant as an inducement to the assignee or subtenant in
question, any moving or relocation expenses of such assignee or subtenant which
are paid by Tenant, and any tenant work performed by Tenant at its expense in
connection with such assignment or subletting based on bills, receipts or other
evidence of such costs reasonably satisfactory to Landlord.
7.11. Each subletting shall be subject to all of the
covenants, agreements, terms, provisions and conditions contained in this Lease.
Notwithstanding any such subletting, Tenant shall and will remain fully liable
for the payment of the Fixed Rent and Additional Charges due and to become due
hereunder and for the performance of all the covenants, agreements, terms,
provisions and conditions contained in this Lease on the part of Tenant to be
performed and all acts and omissions of any licensee or subtenant or anyone
claiming under or through any subtenant which shall be in violation of any of
the obligations of this Lease, and any such violation shall be deemed to be a
violation by Tenant. Tenant further agrees that notwithstanding any such
subletting, no other and further subletting of the Premises by Tenant or any
person claiming through or under Tenant (except as provided in Section 7.10
hereof) shall or will be made except upon compliance with and subject to the
provisions of this Article. If Landlord shall decline to give its consent to any
proposed assignment or sublease, Tenant shall indemnify, defend and hold
harmless Landlord against and from any and all loss, liability, damages, costs
and expenses (including, but not limited to, reasonable counsel fees) resulting
from any claims that may be made against Landlord by the proposed assignee or
sublessee or by any brokers or other persons claiming a commission or similar
compensation in connection with the proposed assignment or sublease.
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7.12. (a) With respect to (i) subject to Section 7.12(f)
hereof, any subletting of at least 2 contiguous floors within the Retail
Premises to a bona-fide third party unaffiliated with Tenant or (ii) any
subletting of twenty thousand (20,000) or more contiguous rentable square feet
in the Office Premises to a bona-fide third party unaffiliated with Tenant,
which in the case of either clause (i) or (ii) of this sentence:
(A) complies with the provisions of clauses (1) through
(5) of Section 7.08(b) hereof,
(B) provides for fixed rent and additional rent on
account of Real Estate Taxes, Operating Expenses and
electricity, on a per rentable square foot basis,
which, in the aggregate, is equal to or in excess of
the sum of (i) the rate of Fixed Rent allocated to
such portion of the Premises in accordance with
Exhibit D annexed hereto, on a per rentable square
foot basis, plus (ii) the Additional Charges on
account of Real Estate Taxes, Operating Expenses and
electricity payable by Tenant hereunder and allocated
to such portion of the Premises, such allocation to
be made on a per rentable square foot basis in
accordance with the rentable areas for each floor of
the Premises as set forth on Exhibit B-1 annexed
hereto (the minimum Fixed Rent and Additional Charges
required to be paid by such subtenant pursuant to
this clause (B) being herein collectively called the
"Minimum SNDA Rent"), or, in the alternative,
provides for a rental rate that is less than the
Minimum SNDA Rent, but will automatically increase to
the Minimum SNDA Rent from and after the attornment
of the sublessee to Landlord as hereinafter provided,
(1)
(C) in the case of subleases of the Retail Premises, is
for a term of at least ten (10) years and has a term
which expires on the same date as all other subleases
of the Retail Premises then in effect as to which
Landlord has theretofore granted a Subtenant SNDA [as
such term is defined in this Section 7.12 (a)] (and
does not contain any extension or renewal options
----------
(1) Notwithstanding the foregoing provisions of this clause (B), in the
case of proposed sublettings of the Retail Premises, the calculation of
Minimum SNDA Rent shall be made without reference to Additional Charges
payable under this Lease with respect to Operating Expenses and/or, for
so long as the proposed subtenant is paying for electricity on a direct
meter basis or a submetered basis to Landlord, without reference to
Additional Charges payable under this Lease with respect to
electricity.
52
which would be binding on Landlord in the event
Landlord succeeds to the position of Tenant under
such sublease),
(D) in the case of subleases of the Office Premises, is
for a term of at least five (5) years,
(E) permits the use of the portion of the Premises so
sublet solely for uses permitted under Section 2.02
hereof, and no other purposes, and, in addition, (x)
with respect to a sublease of the Office Premises,
shall expressly prohibit use for purposes prohibited
under Section 2.02(c) hereof and for any Additional
Prohibited SNDA Uses (as such term is defined in
Section 7.12(d) hereof), (y) with respect to a
sublease of the Retail Premises, shall expressly
prohibit use for a restaurant and/or bar except for a
Permitted SNDA Restaurant/Bar Use (as such term is
defined in Section 7.12(e) hereof) or a restaurant
and/or bar use which is incidental to another use of
the Retail Premises permitted hereunder (e.g., a
restaurant and/or bar included within a bookstore),
(F) in the case of a proposed subletting of all or any
portion of the Retail Premises for an entertainment
use (including, without limitation, live
performances, movies or multimedia screening rooms),
requires the installation of sound attenuation
material sufficient to reduce sound emission from the
applicable portion of the Retail Premises to any
other portion of the Retail Premises, or any portion
of the Office Premises or Building Lobby, or any
leased portions of the Below-Grade Premises
(collectively, the "Applicable Areas"), in each case
to the following standard:
No sound shall be emitted from within the
applicable portion of the Retail Premises
which exceeds a level of NC 30. Measurements
of sound levels shall be made in accordance
with the American National Standards
Institute of Standard S1-1984, with a "type
1" sound level meter as defined in such
standards,
Landlord agrees that, within twenty (20) days after written request of Tenant
and delivery to Landlord of the items referred to in subsections 7.08(b)(l), (2)
and (3) hereof and payment of the charges referred to in subsection 7.08(b)(5)
hereof, Landlord shall enter into a subordination, non-disturbance and
attornment agreement with the subtenant in the form annexed hereto as Exhibit 1
(herein called a "Subtenant SNDA"). The sublease in question shall be deemed to
contain the Minimum SNDA Rent as required pursuant to this Section 7.15
notwithstanding that
53
such rental rate is only payable after such subtenant becomes a direct tenant of
Landlord pursuant to the applicable Subtenant SNDA. In the event Tenant shall
request such a Subtenant SNDA on behalf of a particular subtenant, then, in
making its determination as to the acceptability of such subtenant, Landlord
shall apply, in its review of the creditworthiness and financial ability of such
subtenant, the same standard of review as Landlord would use with respect to a
direct tenant proposing to lease from Landlord the amount of space in the
Building which such subtenant is proposing to sublet for the Minimum SNDA Rent
as if such sublease were a Major Sublease.
(b) Intentionally Omitted.
(c) In the event that (i) Tenant has converted the 5th floor
or the 4th and 5th floors, as the case may be (herein called the "Converted
Floor(s)") to use as Office Premises pursuant to Section 2.02(d) hereof, (ii)
Tenant has previously sublet by one or more subleases the entire balance of the
Retail Premises remaining after such conversion and Landlord has entered into a
Subtenant SNDA with the subtenant(s) under all such subleases of the Retail
Premises, (iii) Tenant proposes to sublease the Converted Floor(s) or a portion
thereof and such sublease would otherwise qualify for a Subtenant SNDA under
this Section 7.12 but for the fact the rental thereunder does not equal or
exceed the Minimum SNDA Rent, then such sublease shall be deemed to contain the
Minimum SNDA Rent if the aggregate of the rents under the sublease of the
Converted Floor(s) or portion thereof and the rents for the aforementioned
subleases of the Retail Premises equals or exceeds the aggregate Minimum SNDA
Rent for the entire Retail Premises and such Converted Floor(s) or portion
thereof as set forth on Exhibit D annexed hereto, provided, however, that in
considering whether to grant a Subtenant SNDA to the subtenant of the Converted
Floor(s) or portion thereof under such circumstances Landlord may take into
account, in addition to all other relevant factors, the net worth and
creditworthiness of the subtenants of the Retail Premises, and Tenant shall
provide Landlord upon request with such information regarding such net worth and
creditworthiness as Landlord may reasonably request.
(d) As used herein the term "Additional Prohibited SNDA Uses"
shall mean (1) a banking, trust company, or safe deposit business (other than
general and executive offices for such businesses and not for "off the street"
business purposes) and, (2) a savings bank, a savings and loan association, or a
loan company operating an "off the street" business to the general public at the
Premises (other than general and executive offices for such businesses and not
for "off the street" business purposes), (3) the sale of travelers' checks
and/or foreign exchange (other than general and executive offices for such
businesses and not for "off the street" business purposes), (4) a stock
brokerage office operating an "off the street" business to the general public at
the Premises (other than general and executive offices for stock brokerage
business and not for "off the street" business purposes), (5) a restaurant
and/or bar and/or the sale of confectionery and/or soda and/or beverages and/or
sandwiches and/or ice cream and/or baked goods, (6) the business of photographic
reproductions and/or offset printing (except that such
54
subtenant may use part of the sublet premises for photographic reproductions
and/or offset printing in connection with, either directly or indirectly, its
own business and/or activities and except for general and executive offices: for
such businesses and not for "off the street" business purposes), (7) an
employment or travel agency (other than general and executive offices for such
businesses and not for "off the street" business purposes), (8) a school or
classroom (other than general and executive offices of a school or university
and not for classroom use), (9) offices of any charitable, religious, union or
other not-for-profit organization, or any tax exempt entity within the meaning
of Section 168(j)(4)(A) of the Internal Revenue Code of 1986, as amended, or any
successor or substitute statute, or rule or regulation applicable thereto (as
same may be amended).
(e) As used herein, the term "Permitted SNDA Restaurant/Bar
Use" shall mean either (i) a restaurant and/or bar use which in either case
sells food and beverages primarily on a table service basis, excluding any such
restaurants or bars providing a quality of food or service at or below the
quality of food or service provided by Denny's, Friendly's, and/or other similar
establishments as of the date of this Lease, or (ii) a McDonald's and/or
Starbuck's, or (iii) a so-called "flagship" location for a national restaurant
and/or bar chain. In order to qualify the use of the Retail Premises (or portion
thereof) as a "flagship" location, Tenant must furnish Landlord with evidence
reasonably satisfactory to Landlord that the subtenant in question (A) is a
national or regional chain with not less than 150 locations in addition to the
location at the Building, (B) intends to use the Retail Premises (or portion
thereof sublet by such subtenant) as a unique (among locations in Manhattan),
flagship location which will include substantial amenities not found at any
other locations of such chain in Manhattan, and (C) intends to make improvements
to the Retail Premises (or portion thereof sublet by such subtenant) at a cost
per square foot substantially in excess of the cost per square foot which would
be incurred by such subtenant in installing a "typical" location for such
subtenant in the Retail Premises (and any Subtenant SNDA executed with such
subtenant shall contain and be subject to the condition that such subtenant
shall deliver to Landlord, within thirty (30) days after occupying the Retail
Premises or any portion thereof, evidence reasonably satisfactory to Landlord,
including without limitation copies of paid invoices, evidencing that the
requirements of clauses (B) and (C) of this sentence have been met). It is
acknowledged and agreed that, as a condition to Landlord's obligation to grant a
Subtenant SNDA with respect to a proposed subletting for a Permitted SNDA
Restaurant/Bar Use, such subletting must also comply with the provisions of
clauses (1) through (4) of Section 7.08(b) hereof and the remaining provisions
of this Section 7.12 applicable to a subletting of all or a portion of the
Retail Premises.
(f) A subtenant which subleases in the aggregate at least 2
contiguous floors within the Retail Premises by means of (i) a direct sublease
from Tenant covering a portion of such subtenant's premises (the "Direct
Sublease Space"), and (ii) an underlease from Tenant or an Affiliate of Tenant
covering the balance of such subtenant's premises (the "Sublease Back Space").
which Sublease Back Space was sub-sublet to Tenant or such Affiliate, as the
case may
55
be, pursuant to a Sublease Back (as such term is defined in Section 42.01(vi)
hereof), shall be deemed to meet the requirement of clause (i) of the first
sentence of Section 7.12(a) hereof. Such subtenant shall be entitled to a
Subtenant SNDA provided and on condition that:
(1) both the subletting of the Direct Sublease Space and
the underletting of the Sublease Back Spade otherwise
meet the applicable requirements of Section
7.12(a)(A), (C), (D), (E) and (F) hereof, and
(2) both the subletting of the Direct Sublease Space and
the underletting of the Sublease Back Space expire on
the same date, and
(3) the sublease of the Direct Sublease Space meets the
requirements of Section 7.12(a)(B) hereof, and
(4) the underlease of the Sublease Back Space provides
for fixed rent and additional rent on account of Real
Estate Taxes, Operating Expenses and electricity, on
a per rentable square foot basis, which, in the
aggregate, is equal to or in excess of the Minimum
SNDA Rent for such Sublease Back Space, or, in the
alternative, provides for a rental rate that is less
than the Minimum SNDA Rent, but will automatically
increase to the Minimum SNDA Rent from and after the
attornment of the sublessee to Landlord in the event
of a termination of both the underlease and the
Sublease Back.
(g) With respect to a proposed subletting of the entire Retail
Premises (or a portion thereof consisting of at least the entire first, second
and third floors of the Building) which would otherwise meet the requirements
for obtaining a Subtenant SNDA under this Section 7.12 but for the fact that the
proposed sublease fails to meet the requirement of Section 7.12(a)(B) hereof,
Landlord agrees that it shall not unreasonably refuse to execute and deliver a
Subtenant SNDA with respect to such proposed subletting and the Sign Agreement
(as such term is defined in Section 42.01(iv) hereof) referred to in Section
7.12 (g)(ii) below, provided and on condition that:
(i) the proposed sublease provides for the payment to
Tenant (or to Landlord upon an attornment of such
subtenant to Landlord in the event of a termination
of this Lease) of fixed rent and additional rent on
account of Real Estate Taxes, Operating Expenses and
electricity which, in the aggregate, is equal to or
in excess of eighty-five (85%) percent of the Minimum
SNDA Rent for the premises proposed to be sublet (the
amount by which such fixed rent and additional rent
under such proposed sublease
56
is less than such Minimum SNDA Rent being herein
called the "Retail Rent Shortfall");
(ii) prior to or simultaneously with the execution of such
sublease, Tenant has entered into a Sign Agreement
with either the proposed subtenant in question or a
third-party Sign User (as such term is defined in
Section 42.01(iv) hereof), which, in either case,
(x) provides for the payment by the subtenant or
Sign User, as the case may be, to Tenant (or
to Landlord upon an attornment of such
subtenant or Sign User to Landlord in the
event of a termination of this Lease), of
rent, license fees and/or other income in an
amount not less than the greater of(A) the
reasonable fair market consideration for the
sign locations in question, or (B) the
Retail Rent Shortfall,
(y) is for a term which ends and expires on the
expiration date or earlier termination of
the proposed sublease, and
(z) is otherwise in form and substance
reasonably satisfactory to Landlord; and
(iii) in the case of a third party Sign User, the
creditworthiness of such Sign User is reasonably
satisfactory to Landlord taking into account that the
payments being made by such Sign User are, in part,
"compensating" for the Retail Rent Shortfall and,
accordingly, that Landlord requires that the
creditworthiness of such Sign User be at least as
favorable as the creditworthiness of the proposed
subtenant; provided, however, that in considering the
acceptability of the creditworthiness of such Sign
User, Landlord shall further consider any improvement
in the net worth and creditworthiness of the then
Tenant as of the date such Subtenant SNDA is
requested from the net worth and creditworthiness of
Tenant on the date of this Lease.
Notwithstanding the provisions of clause (g)(ii)(y) of the preceding sentence,
Landlord agrees that, if the Sign User in question is a third party other than
the proposed retail subtenant or an affiliate of the proposed retail subtenant,
a Sign Agreement for a term which ends and expires on the expiration date or
earlier termination of the proposed sublease but not upon any earlier
termination of the proposed sublease shall be acceptable to Landlord if, as of
the date such Subtenant SNDA's are requested, the proposed subtenant of the
Retail Premises in question has a
57
Standard & Poors credit rating of at least "BBB+" or a then-equivalent credit
rating (herein called the "Minimum Retail Credit Rating"). If the proposed
subtenant does not meet the Minimum Retail Credit Rating, Landlord agrees
nevertheless to consider granting the Subtenant SNDA for the proposed Sign
Agreement which is for a term as described in the immediately preceding sentence
if the then Tenant has a credit rating equal to the Minimum Retail Credit Rating
and Tenant shall provide Landlord with assurances reasonably satisfactory to
Landlord that Tenant will maintain such Minimum Retail Credit Rating for the
balance of the term of the proposed sublease of the Retail Premises.
ARTICLE 8
Compliance with Laws
8.01. Tenant shall give prompt notice to Landlord of any
notice it receives of the violation of any law or requirement of any public
authority with respect to the Premises or the use or occupation thereof. Tenant
shall, at Tenant's expense, comply with all present and future Legal
Requirements in respect of the Premises or the use and occupation thereof, or
the abatement of any nuisance in, on or about the Premises; provided, however,
that Tenant shall not be obligated to make (x) structural repairs or
alterations, or (y) repairs or alterations to those portions of the Building
Systems installed by Landlord, or (z) any other repairs or alterations (herein
called "Building Work Future Compliance Costs") which are required to comply
with Legal Requirements and are required to be made to or as a result of
installations or improvements made as part of Building Work (as opposed to any
Alterations made by Tenant including, without limitation, Tenant's Work), unless
the need for any of the alterations or repairs referred to in clauses (x), (y),
or (z) of this sentence arises out of one or more of the causes set forth in
clauses (i) through (iii) of the next succeeding sentence. Tenant shall also be
responsible for the cost of compliance with all present and future Legal
Requirements in respect of the Real Property arising from (i) Tenant's
particular manner of use of the Premises or operation of its installations,
equipment or other property therein (other than the mere use of the Office
Premises as generic executive and general offices and the Retail Premises as
generic retail space), (ii) any cause or condition created by or at the instance
of Tenant, including, without limitation, any Alterations made by Tenant,
including, without limitation, Tenant's Work, or (iii) the breach of any
Tenant's obligations hereunder, whether or not such compliance arises from any
of the causes set forth in this sentence requires work which is structural or
non-structural, ordinary or extraordinary, foreseen or unforeseen. Tenant shall
pay all the costs, expenses, fines, penalties and damages which may be imposed
upon Landlord or any Superior Lessor by reason of or arising out of Tenant's
failure to fully and promptly comply with and observe the provisions of this
Section 8.01. Without limiting the generality of the foregoing, it is
specifically agreed that Tenant shall comply with all Legal Requirements that
require the installation, modification or
58
maintenance within the Premises of (i) any fire-rated partitions, gas, smoke, or
fire detector or alarm, any emergency signage or lighting system, or any
sprinkler or other system to extinguish fires or (ii) any handicap facilities,
except that the foregoing shall not be deemed to limit Landlord's obligation to
perform the Building Work. However, Tenant need not comply with any law or
requirement of any public authority so long as Tenant shall be contesting the
validity thereof, or the applicability thereof to the Premises, in accordance
with Section 8.02 hereof. Landlord, at its expense but subject to recoupment as
Operating Expenses if and to the extent provided in Article 3 hereof, shall
comply with all Legal Requirements applicable with respect to the Premises but
only to the extent Tenant is not required to comply therewith pursuant to this
Section 8.01 or any other provision of this Lease. Landlord may defer compliance
so long as Landlord shall be contesting the validity or applicability thereof or
so long as other owners of first-class office buildings in New York, New York
are generally not complying with a particular Legal Requirement, provided that,
in any event, (A) Landlord's deferral of such compliance does not (i) adversely
affect Tenant's use or enjoyment of the Premises for the uses permitted under
this Lease, (ii) prevent or delay Tenant from making Alterations permitted
hereunder, (iii) prevent Tenant from making New York City Building Department
filings or obtaining permits for Alterations, (iv) subject Tenant to criminal
penalty or to prosecution for a crime, or any other fine or charge, or (v)
prevent Tenant from fulfilling its obligations under this Lease, and (B) the
Premises, or any part thereof, shall not be subject to being condemned or
vacated, by reason of such non-compliance or otherwise by reason of such
contest.
8.02. Tenant, at its expense, after notice to Landlord, may
contest, by appropriate proceedings prosecuted diligently and in good faith, the
validity, or applicability to the Premises, of any law or requirement of any
public authority, provided that (a) Landlord shall not be subject to criminal
penalty or to prosecution for a crime, or any other fine or charge, nor shall
the Premises or any part thereof or the Building or Land, or any part thereof,
be subject to being condemned or vacated, by reason of non-compliance or
otherwise by reason of such contest; (b) before the commencement of such
contest, Tenant shall furnish to Landlord a cash deposit or other security in
amount, form and substance reasonably satisfactory to Landlord and shall
indemnify Landlord against the cost thereof and against all liability for
damages, interest, penalties and expenses (including reasonable attorneys' fees
and expenses), resulting from or incurred in connection with such contest or
non-compliance, provided however that such requirement shall not apply if Tenant
furnishes to Landlord evidence that the net worth of Tenant computed in
accordance with GAAP is at least equal to the Base Net Worth; (c) such
noncompliance or contest shall not prevent Landlord from obtaining any and all
permits and licenses in connection with the operation of the Building; and (d)
Tenant shall keep Landlord advised as to the status of such proceedings. Without
limiting the application of the above, Landlord shall be deemed subject to
prosecution for a crime if Landlord, or the Manager, or any officer, director,
partner, shareholder or employee of Landlord or the Manager, as an individual,
is charged with a crime of any kind or degree whatever, whether by service of a
summons or
59
otherwise, unless such charge is withdrawn before Landlord or the Manager, or
such officer, director, partner, shareholder or employee of Landlord or the
Manager (as the case may be) is required to plead or answer thereto.
Notwithstanding the foregoing provisions of this Article 8, Tenant shall not be
deemed to be in default of its obligations to make any repair, alteration or
improvement to, or to maintain, the Premises pursuant to Section 8.01 hereof if
and to the extent Tenant is unable to do so by reason of strikes, labor disputes
or unavailability of materials or work force or by reason of Landlord's breach
of its obligations under this Lease (herein collectively called "Tenant Force
Majeure Causes"), but Tenant shall commence such repairs, alterations or
improvements promptly after the cessation of such Tenant Force Majeure Causes
and thereafter diligently pursue same to completion.
ARTICLE 9
Insurance
9.01. Tenant shall not violate, or permit the violation of,
and shall promptly cure or cause the cure of any such violation of which Tenant
receives written notice, any condition imposed by any insurance policy then
issued in respect of the Real Property (provided such condition is a Standard
Insurance Requirement) and shall not do, or permit anything to be done, or keep
or permit anything to be kept in the Premises which would subject Landlord, any
Superior Lessor or any Superior Mortgagee to any liability or responsibility for
personal injury or death or property damage, or which would increase any
insurance rate in respect of the Real Property over the rate which would
otherwise then be in effect or which would result in insurance companies of good
standing refusing to insure the Real Property in amounts reasonably satisfactory
to Landlord, or which would result in the cancellation of or the assertion of
any defense by the insurer in whole or in part to claims under any policy of
insurance in respect of the Real Property; provided, however, that in no event
shall the mere use of the Office Premises for customary and ordinary office
purposes or the mere use of the Retail Premises for retail purposes permitted
under this Lease, as opposed, in either case, to the manner of such use,
constitute a breach by Tenant of the provisions of this Section 9.01.
9.02. If, by reason of any failure of Tenant to comply with
the provisions of this Lease, the premiums on Landlord's insurance on the Real
Property shall be higher than they otherwise would be, and Landlord shall notify
Tenant of such fact and, if Tenant shall not within 15 days thereafter, rectify
such failure so as to prevent the imposition of such increase in premiums, then
Tenant shall reimburse Landlord, on demand and as Additional Charges, for that
part of such premiums attributable to such failure on the part of Tenant. A
schedule or "make up" of rates for the Real Property or the Premises, as the
case may be, issued by the New York Fire Insurance Rating Organization or other
similar body making rates for insurance for the Real Property or the Premises,
as the case may be, shall be conclusive evidence of the facts therein
60
stated and of the several items and charges in the insurance rate then
applicable to the Real Property or the Premises, as the case may be.
9.03. Tenant, at its expense, shall maintain at all times
during the term of this Lease (a) "all risk" property insurance covering all
present and future leasehold improvements, Tenant's Property and Tenant's
improvements and betterments to a limit of not less than the full replacement
value thereof, such insurance to include a replacement cost endorsement, and (b)
commercial general liability insurance, including contractual liability, in
respect of the Premises and the conduct or operation of business therein, with
Landlord and the Manager, if any, and each Superior Lessor and Superior
Mortgagee whose name and address shall previously have been furnished to Tenant,
as additional insureds, with limits of not less than Five Million ($5,000,000)
Dollars combined single limit for bodily injury and property damage liability in
any one occurrence, (c) steam boiler, air-conditioning or machinery insurance,
if there is a boiler or pressure object or similar equipment in the Premises
(excluding any portions of the Building Systems), with Landlord and the Manager,
if any, and each Superior Lessor and Superior Mortgagee whose name and address
shall previously have been furnished to Tenant, as loss payees, with limits of
not less than Five Million ($5,000,000) Dollars and (d) when Alterations are in
progress, the insurance specified in Section 11.05 hereof. The limits of such
insurance shall not limit the liability of Tenant. At least ten (10) days prior
to the Commencement Date, Tenant shall deliver (i) to Landlord, a duplicate
original (or a copy certified by Tenant's insurance carrier to be true, accurate
and complete) of such fully paid-for policies, and (ii) to any additional
insureds other than Landlord, certificates of such insurance issued by the
insurance company or its authorized agent. Tenant shall procure and pay for
renewals of such insurance from time to time before the expiration thereof, and
Tenant shall deliver to Landlord and any other additional insureds a certificate
evidencing such renewal issued by the insurance company or its authorized agent
at least thirty (30) days before the expiration of any existing policy with a
duplicate original (or a copy certified by Tenant's insurance carrier to be
true, accurate and complete) of such renewal policy to be delivered to Landlord
promptly after same is available to Tenant. All such policies shall be issued by
companies of recognized responsibility licensed to do business in New York State
and rated by Best's Insurance Reports or any successor publication of comparable
standing and. carrying a rating of A VIII or better or the then equivalent of
such rating (herein called "Acceptable Insurance Companies"), and all such
policies shall contain a provision whereby the same cannot be canceled or
modified unless Landlord and any additional insureds are given at least thirty
(30) days prior written notice of such cancellation or modification. The
proceeds of policies providing "all risk" property insurance of Tenant's
improvements and betterments shall be payable to Landlord, Tenant and each
Superior Lessor and Superior Mortgagee as their interests may appear. The
parties shall cooperate with each other in connection with the collection of any
insurance monies that may be due in the event of loss and Tenant shall execute
and deliver to Landlord such proofs of loss and other instruments which may be
reasonably required to recover any such insurance monies. Such insurance may be
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carried in a blanket policy covering the Premises and other locations of Tenant,
if any, provided that each such policy shall in all respects comply with this
Article 9 and shall specify that the portion of the total coverage of such
policy that is allocated to the Premises is in the amounts required pursuant to
this Section 9.03.
9.04. Each party agrees to have included in each of its
insurance policies (insuring the Building and any other Landlord's property
therein in case of Landlord, and insuring Tenant's Property (as such term is
defined in Section 12.02 hereof) and improvements and betterments in the case of
Tenant, against loss, damage or destruction by fire or other casualty) a waiver
of the insurer's right of subrogation against the other party during the term of
this Lease or, if such waiver should be unobtainable or unenforceable, (i) an
express agreement that such policy shall not be invalidated if the assured
waives the right of recovery against any party responsible for a casualty
covered by the policy before the casualty or (ii) any other form of permission
for the release of the other party. If such waiver, agreement or permission
shall not be, or shall cease to be, obtainable from either party's then current
insurance company, the insured party shall so notify the other party promptly
after learning thereof, and shall use its best efforts to obtain the same from
another insurance company described in Section 9.03 hereof. Each party hereby
releases the other party, with respect to any claim (including, without
limitation, a claim for negligence) which it might otherwise have against the
other party, for loss, damage or destruction with respect to its property
occurring during the term of this Lease to the extent to which it is, or is
required to be, insured under a policy or policies containing a waiver of
subrogation or permission to release liability, as provided in the preceding
subdivisions of this Section (collectively, "Insured Losses"). Nothing contained
in this Section shall be deemed to relieve either party of any duty imposed
elsewhere in this Lease to repair, restore or rebuild or to nullify any
abatement of rents provided for elsewhere in this Lease.
9.05. Landlord may from time to time (but not more than one
time in any thirty-six (36) month period) require that the amount of the
insurance to be maintained by Tenant under Section 9.03 hereof be reasonably
increased, so that the amount thereof adequately protects Landlord's interest;
provided, however, that the amount to which such insurance requirements may be
increased shall not exceed an amount then being required by landlords of
comparable office buildings or buildings containing both office and retail use
in the Times Square section of Manhattan.
9.06. (a) Landlord shall maintain in respect of the Building
at all times during the term of this Lease fire and casualty insurance covering
the Building and Landlord's property (but excluding all present and future
leasehold improvements. Tenant's Property and Tenant's improvements and
betterments) to a limit of not less than the full replacement value thereof.
Such insurance may be carried in a blanket policy covering the Building and
other locations of Landlord or its affiliates, and in such event Landlord shall
make a reasonable
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allocation of the portion of the total premium paid for such blanket policy
allocable to the Real Property for purposes of computing Operating Expenses and,
within fifteen (15) days after written request, shall furnish Tenant with
documentation showing the basis of such allocation. Landlord shall maintain or
cause its contractor to maintain "builder's risk" insurance during the period
the Building Work is being performed. Landlord shall at all times during the
term of this Lease maintain in effect commercial general liability insurance
covering the Premises in an amount not less than the amount of commercial
general liability insurance required to be carried by Tenant from time to time
under this Lease, and Landlord shall name Tenant as an additional insured
thereunder, but only as to third-party claims against Tenant which result from
Landlord's breach of its obligations contained in this Lease. Landlord shall
furnish to Tenant a certificate of insurance evidencing the insurance required
to be maintained by Landlord hereunder (including, without limitation, any
renewals and amendments thereto) within ten (10) days after written request by
Tenant therefor, but not more than once in any twelve (12) month period.
(b) In the event Landlord fails to carry any insurance which
Landlord is required to maintain under this Lease, Tenant may notify Landlord of
such fact and of Tenant's intention to obtain such insurance on Landlord's
behalf unless Landlord obtains same and furnishes evidence of same to Tenant
within four (4) Business Days after Landlord's receipt of such notice. If
Landlord fails to obtain such insurance and furnish evidence of same to Tenant
within four (4) Business days after receipt of Tenant's notice, then Tenant may
give Landlord a second notice of such fact and of Tenant's intention to obtain
such insurance on Landlord's behalf within two (2) Business Days after receipt
of Tenant's second notice, and if, within two (2) Business Days after receipt of
Tenant's second notice, Landlord has failed to obtain such insurance and furnish
evidence of same to Tenant, Tenant may (in its sole discretion and without any
liability whatsoever if Tenant elects not to do so) obtain such insurance on
Landlord's behalf at Tenant's sole cost and expense except that Landlord shall
reimburse Tenant for the cost of obtaining such insurance if and then only to
the extent that such cost exceeds the cost which Landlord would have incurred to
obtain such insurance (taking into account, for example, Landlord's ability, if
any, to obtain such insurance under a blanket policy if applicable) within ten
(10) days after delivery to Landlord of an invoice therefor (herein called
"Incremental Insurance Costs"), together with interest on such Incremental
Interest Costs at the Interest Rate from the date expended by Tenant until the
date reimbursed by Landlord. If Landlord fails to reimburse Tenant for such
Incremental Insurance Costs within such ten (10) day period, then Tenant may
offset same with interest at the Interest Rate from the date expended by Tenant
until the date offset by Tenant against the next installment(s) of Fixed Rent
payable under this Lease. Notwithstanding the foregoing, if at any time prior to
Tenant's offset of such amounts Landlord disputes Tenant's claim that Landlord
was required to obtain such insurance and/or that Landlord has failed to do so
and/or furnish evidence of same to Tenant, then Tenant may not exercise such
offset right unless and until such dispute has been finally resolved in Tenant's
favor. Any such
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dispute which is not resolved between the parties within fifteen (15) days after
Landlord's notice of dispute shall be finally resolved by Expedited Arbitration.
ARTICLE 10
Intentionally Omitted
ARTICLE 11
Alterations
11.01. (a) Except as otherwise specifically provided in this
Lease, Tenant shall make no improvements, changes or alterations in or to the
Premises (herein called "Alterations") of any nature without Landlord's prior
written approval.
(b) With respect to Alterations other than those
performed as part of Tenant's Work, if Landlord shall fail to respond to
Tenant's written request for approval of any such Alterations, which request
shall be accompanied by drawings, plans and specifications to the extent
required by and in accordance with the provisions of Section 11.02(a) hereof
(herein called an "Initial Alterations Request"), within ten (10) Business Days
after such Initial Alterations Request is made by Tenant, with Landlord's
approval or disapproval, then Tenant shall have the right to give to Landlord a
second notice (herein called a "Second Alterations Request"), and if Landlord
shall fail to respond to such Second Alterations Request within five (5)
Business Days after Landlord's receipt thereof with Landlord's written approval
or disapproval (and any such disapproval shall set forth in reasonable detail
the reason(s) therefor), then such Second Alterations Request shall be deemed
approved by Landlord, provided that such Initial Alterations Request and Second
Alterations Request shall have specifically referred to this Section 11.01 and
specifically stated that Landlord must respond within such ten (10) Business Day
and five (5) Business Day periods or such Second Alterations Request for
approval shall be deemed approved.
(c) With respect to Tenant's Work, Tenant shall
submit the plans and specifications therefor in three phases as follows (i)
complete schematic design drawings, (ii) complete design development drawings,
and (iii) complete construction documents. Provided that Tenant submits such
plans and specifications in 3 phases as set forth in the preceding sentence,
then Landlord agrees to respond to Tenant's request for approval to each phase
of such plans and specifications within the number of days set forth in the
chart below following the
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delivery to Landlord of an Initial Alterations Request accompanied by submission
of such phase of the plans and specifications:
Schematic Design Drawings 7 Business Days
Design Development Drawings 7 Business Days
Construction Documents 12 Business Days
Tenant may deliver the plans and specifications for Tenant's Work in multiple
submissions covering various portions of the Premises, but Tenant agrees to act
reasonably in determining the portions of the Premises covered by each
submission (e.g., if Landlord could not reasonably review and approve plans and
specifications covering a portion of a floor because of the particular work
proposed to be performed thereon without reviewing the plans and specifications
for the entire floor, Tenant shall submit the plans and specifications for the
entire floor as a single submission).
If Landlord shall fail to respond to Tenant's Initial Alterations Request as to
any group of plans and specifications for Tenant's Work within the time period
set forth in the chart above with Landlord's approval or disapproval, then
Tenant shall have the right to give to Landlord a Second Alterations Request
with respect thereto, and if Landlord shall fail to respond to such Second
Alterations Request within three (3) Business Days after Landlord's receipt
thereof with Landlord's written approval or disapproval (any disapproval given
by Landlord pursuant to this Section 11.01(c) shall set forth in reasonable
detail the reason(s) therefor), then such group of plans shall be deemed
approved by Landlord, provided that such Initial Alterations Request and Second
Alterations Request shall have specifically referred to this Section 11.01(c)
and specifically stated that Landlord must respond within the time periods set
forth herein, specifically stating such time periods, failing which such plans
and specifications shall be deemed approved.
(d) If Landlord shall approve any plans and
specifications for Tenant's Work in part and disapprove such plans and
specifications in part, Landlord shall notify Tenant with reasonable specificity
of the portions of the plans and specifications which are disapproved by
Landlord, setting forth in reasonable detail the reasons for such disapproval
(herein called a "Partial Approval Notice"). In the event Landlord gives a
Partial Approval Notice, all portions of the plans and specifications submitted
to Landlord which are not disapproved by Landlord in such Partial Approval
Notice shall be deemed approved by Landlord. In addition, in the event Landlord
gives a Partial Approval Notice and tenant disputes Landlord's disapproval
pursuant to Section 38.01 hereof and it is subsequently determined that Landlord
wrongfully withheld its approval of a portion of Tenant's plans and
specifications, then notwithstanding the provisions of
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Section 2.01(e) hereof to the contrary, Tenant shall not be entitled to an
extension of the Rent Commencement Date as provided for in Section 2.01(e). In
lieu of such extension, Tenant shall be entitled to an abatement of the Fixed
Rent and Additional Charges (in addition to any other abatements to which Tenant
is otherwise entitled under this Lease) allocable to the portion of the Premises
(which may constitute the entire Premises) in which Tenant could not, consistent
with reasonable construction scheduling practices, reasonably commence or
continue to perform Tenant's Work by reason of such partial disapproval of
Tenant's plans and specifications for each day that, as a result of such
disapproval, Tenant is delayed in occupying the Office Premises (or such portion
thereof) for the conduct of its business or using the Retail Premises (or such
portion thereof) for the purposes permitted hereunder. If Tenant shall dispute a
Partial Approval Notice, then the notice of such dispute given by tenant
pursuant to Section 38.01 hereof shall specify the portion of the Premises as to
which Tenant is Unable to commence or continue Tenant's Work in accordance with
the immediately preceding sentence (which may constitute the entire Premises).
Any disputes between Landlord and Tenant with respect to the application of this
Section 11.01(d) which are not resolved within ten (10) days after either party
notifies the other party of such dispute shall be resolved by Expedited
Arbitration.
(e) Any plans and specifications submitted for
Landlord's approval for Tenant's Work or other Alterations which are disapproved
shall be resubmitted to Landlord with the revisions clearly marked as such. If
Landlord shall fail to respond to a request for approval of any such resubmitted
plans within five (5) Business Days following delivery to Landlord of such
resubmitted plans, then Tenant shall have the right to give to Landlord a second
notice with respect thereto, stating that if Landlord fails to respond to such
second request for approval within two (2) Business Days after delivery of such
second notice Landlord shall be deemed to have approved the revisions set forth
on such resubmitted plans and specifications; if Landlord shall fail to respond
to such second notice within two (2) Business Days after Landlord's receipt
thereof with Landlord's written approval or disapproval (and any such
disapproval given by Landlord shall set forth in reasonable detail the reason(s)
therefor), then such resubmitted plans and specifications shall be deemed
approved by Landlord.
(f) Notwithstanding anything to the contrary set
forth above and provided Tenant shall be in compliance with the applicable
provisions of this Article II, Tenant or any permitted subtenant or other
permitted occupant of the Premises, may at its sole expense, without Landlord's
prior approval, undertake Non-Material Alterations [as such term is defined in
this Section 11.01(f)]. A "Material Alteration" is an Alteration which (i) is
not limited to the interior of the Premises or which affects the exterior
(including, without limitation, the appearance) of the Building or the windows
of the Building (other than merely being visible through the windows of the
Building), (ii) is structural or affects the structural integrity or strength of
the Building, (iii) affects the usage or the proper functioning of the
mechanical, electrical, sanitary, heating, ventilating; air-conditioning or
other service systems of the Building,
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except to a de minimis extent and except that Alterations which affect solely
the internal distribution of any such systems installed by Tenant, as opposed to
the portions of such systems installed by Landlord as part of the Building Work
(herein called "System Distribution Alterations"), shall not be deemed "Major
Alterations" by reason of this clause (iii), or (iv) affects the Lobby of the
Building, except that changes affecting solely the finishes of the Lobby (i.e.,
painting, wall coverings, and floor coverings) and other nonstructural changes
to the interior of the Lobby (i.e., not including an expansion of the size of
the Lobby or the location of the Building doors) which do not affect Building
Systems located within or serving the Lobby (other than System Distribution
Alterations) shall not be deemed "Major Alterations" by reason of this clause
(iv). Any Alteration which is not a Material Alteration is herein called a
"Non-Material Alteration". Landlord agrees not to unreasonably withhold its
consent to any Material Alteration, and the provisions and procedures of Section
11.01(b) shall apply with respect to any request by Tenant for approval of any
Material Alterations. For purposes hereof, Landlord shall not be deemed to be
acting unreasonably if it withholds consent to a Material Alteration which: (i)
affects the exterior of the Building (other than mere appearance of the exterior
of the Building), (ii) would have an adverse affect on the heating, ventilation
and air-conditioning (herein called "HVAC"), mechanical, electrical or plumbing
facilities of the Building (except to a de minimis extent and except for System
Distribution Changes), (iii) would have an adverse affect (except to a de
minimis extent) on the structure or the structural integrity or strength of the
Building, or (iv) would make Landlord ineligible for or reduce or otherwise
adversely affect Landlord's eligibility for Landlord's Historic Tax Credits,
subject to the provisions of Section 41.02 hereof.
11.02. (a) Before proceeding with any Alteration, Tenant shall
(x) at Tenant's expense, file all required architectural, mechanical, electrical
and engineering drawings and obtain all necessary permits, if any, as required
by applicable Legal Requirements, and (y) submit to Landlord, for Landlord's
approval [but such submission shall, in the case of Non-Material Alterations,
not be for Landlord's approval but rather for the purposes hereinafter set forth
in this subsection 11.02(a) and Section 41.01 hereof], such drawings, plans and
specifications for the work to be done, and Tenant, subject to the deemed
approval provisions set forth in Section 11.01 above, shall not proceed with
such work until it obtains Landlord's written approval of such drawings, plans
and specifications if so required pursuant to Section 11.01 hereof. The
provisions of clause (y) of the immediately preceding sentence shall apply only
with respect to drawings, plans and specifications for Alterations if and to the
extent (i) same are required to be prepared by applicable Legal Requirements, or
(ii) same are otherwise customarily prepared for Alterations of a similar
nature, or (iii) Tenant, in fact, actually prepares such drawings, plans and
specifications. Landlord, at no out-of-pocket cost to Landlord, will cooperate
with Tenant's efforts to obtain the permits necessary to perform such
Alterations (which process Tenant shall have the right to commence prior to
Landlord's granting of consent hereunder, provided that such cooperation by
Landlord shall not in any event be construed as the granting of consent by
Landlord to any Alteration), and Tenant shall indemnify and hold harmless
Landlord from and
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against any claims arising in connection with such cooperation. Tenant shall use
an engineer approved by Landlord (such approval not to be unreasonably withheld
or delayed) with respect to the preparation of Tenant's engineering drawings (if
same are required to be prepared by applicable Legal Requirements or are
otherwise customarily prepared for Alterations of a similar nature or if Tenant,
in fact, prepares engineering drawings for same), in connection with any
Alteration. As of the date of this Lease, Landlord approves the following
engineers (herein called the "Pre-Approved Engineers") for the preparation of
mechanical and electrical engineering drawings in connection with Tenant's Work
or any other Alterations (except that in the case of Alterations other than
Tenant's Work, Landlord reserves the right, prior to Tenant's commencement of
any such work in accordance with the provisions hereof, to remove any
Pre-Approved Engineer from the following list and make substitutions therefor):
Mechanical/Electrical/Plumbing
Xxxxx & Xxxxx Consulting Engineers LLP
Structural
Weidlinger & Associates
Xxxxxxx Associates
Xxxxxx X. Xxxxxx Consulting Engineer
Landlord agrees to advise Tenant from time to time upon written request if any
previously approved engineer is still acceptable to Landlord. Landlord agrees
that the engineers listed above in this Section 11.02(d) are approved for
Tenant's Work and such approval shall not be withdrawn for Tenant's Work.
Except to the extent set forth in the last sentence of this paragraph,
Tenant shall deliver to Landlord plans and/or specifications for all
Non-Material Alterations (if same are required to be prepared by applicable
Legal Requirements or are otherwise customarily prepared for Alterations of a
similar nature or if Tenant, in fact, prepares and/or specifications for same),
and same shall be accompanied by a certificate from the architect or other
professional preparing such plans and/or specifications certifying that the work
shown thereon constitutes a Non-Material Alteration. Landlord's review of
Tenant's plans and specifications for any Non-Material Alterations shall be
limited to a determination as to whether, in Landlord's reasonable judgment, the
proposed Alteration is in fact a Non-Material Alteration. Notwithstanding
anything to the contrary contained herein, Tenant shall not be required to
submit plans and/or specifications with respect to Non-Material Alterations that
are of a merely decorative nature.
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(b) Tenant shall pay to Landlord within thirty (30)
days, as Additional Charges, Landlord's reasonable out-of-pocket costs and
expenses (including, without limitation, the reasonable fees of any
non-Affiliate, third-party architect or engineer employed by Landlord or any
Superior Lessor or Superior Mortgagee for such purpose) for (i) reviewing said
plans and specifications in connection with Alterations that affect the
structure, exterior or operating systems of the Building to the extent Tenant is
required to deliver plans for same as hereinabove in this Article 11 provided
and (ii) inspecting the Alterations to determine whether the same are being
performed in accordance with the approved plans and specifications, if any, and
the provisions of this Lease. The foregoing charges referred to in this Section
11.02(b) shall not apply to Tenant's Work, and in the case of any other
Alterations, such charges shall not exceed one (1%) percent of the actual
construction costs (i.e., "hard" costs) incurred by Tenant in connection with
such Alterations.
(c) Tenant agrees that any review or approval by
Landlord of any plans and/or specifications with respect to any Alterations is
solely for Landlord's benefit, and without any representation or warranty
whatsoever to Tenant with respect to the adequacy, correctness or efficiency
thereof or otherwise.
11.03. (a) Before proceeding with any Alteration which will
cost more than Two Hundred Fifty Thousand ($250,000.00) Dollars (exclusive of
the costs of decorating work and items constituting Tenant's Property), as
estimated by Tenant's contractor performing such work in writing on the basis of
the construction contract therefor (it being agreed that (i) Tenant shall
furnish to Landlord a copy of such construction contract upon request, (ii)
Landlord shall have the right to dispute any such estimate, and (iii) any such
dispute which is not resolved between the parties within ten (10) Business Days
shall be submitted for final determination by Expedited Arbitration), Tenant
shall furnish to Landlord one of the following (as selected by Tenant): (i) a
cash deposit, or (ii) an irrevocable, unconditional, negotiable letter of
credit, issued by and drawn on a bank or trust company which is a member of the
New York Clearing House Association in a form reasonably satisfactory to
Landlord; each to be in an amount equal to the cost of the Alteration, estimated
as set forth above. Any such letter of credit shall be for one year and shall be
renewed by Tenant each and every year until the Alteration in question is
completed and shall be delivered to Landlord not less than thirty (30) days
prior to the expiration of the then current letter of credit. Failure to deliver
such new letter of credit on or before said date shall entitle Landlord to
present the then current letter of credit for payment, and, if such letter of
credit is not paid for any reason upon first presentment, such failure shall be
a default under this Lease. The amount of the security deposit required under
this Section 11.03(a), if any, shall be reduced from time to time by the amounts
paid by Tenant for the costs of such Alterations, each such reduction to be
effective upon delivery to Landlord of paid invoices for portions of such
Alterations as they are completed, accompanied by partial lien waivers for the
amounts
69
evidenced by such invoices from the contractor and any Major Subcontractors (as
such term is defined in Section 38.04 hereof) performing such Alterations.
(b) Upon (i) the completion of the Alteration in
accordance with the terms of this Article 11 and (ii) the submission to Landlord
of proof evidencing the payment in full for said Alteration, the security
deposited with Landlord (or the balance of the proceeds thereof, if Tenant has
furnished cash or a letter of credit and if Landlord has drawn on the same), as
the same may have been reduced as provided in Section 11.03(a) hereof, shall be
returned to Tenant.
(c) Upon Tenant's failure to properly perform,
complete (in accordance with the plans and specifications therefor as same may
be modified by Tenant with Landlord's approval to the extent such approval is
required under this Article 11), and fully pay for the said Alteration, Landlord
shall be entitled to draw on the security deposited under this Article 11 to the
extent Landlord reasonably deems necessary in connection with the said
Alteration, the restoration and/or protection of the Premises or the Real
Property and the payment or satisfaction of any costs, damages or expenses in
connection with the foregoing and/or Tenant's obligations under this Article 11.
(d) The provisions of this Section 11.03 shall not
apply to (i) the original named Tenant, (ii) any successor to the original named
Tenant by acquisition, merger or consolidation or (iii) any other Tenant
hereunder, in each case for so long as Tenant or such successor has a net worth
determined in accordance with GAAP that is equal to or greater than the Base Net
Worth.
11.04. Tenant, in connection with any Alterations, shall fully
and promptly comply with and observe the Construction/Alteration Rules annexed
as Exhibit E hereto.
11.05. (a) Tenant, at its expense, shall obtain (and furnish
true and complete copies to Landlord of) all necessary governmental permits and
certificates for the commencement and prosecution of Alterations and for final
approval thereof upon completion, and shall cause Alterations to be performed in
compliance therewith, with all applicable Legal Requirements, with all
applicable requirements of insurance bodies and with the plans and
specifications approved by Landlord. Alterations shall be diligently performed
in a good and workmanlike manner, using materials and equipment comparable in
quality and class to the other existing installations and improvements in the
Premises.
(b) Alterations shall be performed by contractors
first approved by Landlord, which approval Landlord shall not unreasonably
withhold or delay (it being agreed that Landlord shall be deemed reasonable in
withholding its consent with respect to any contractor
70
that then has a lien with respect to the Building by reason of any work done or
materials furnished by Tenant or anyone acting under or through Tenant);
provided, however, that any Alterations, tie-ins, testing, adjusting or removals
involving the life safety system of the Building shall be (i) performed only
with materials purchased from Landlord's designated life safety contractor (or
with the same materials used by Landlord's designated life safety contractor)
and (ii) either (x) performed by Landlord's designated life safety contractor,
at Tenant's cost and expense or (y) supervised by Landlord's designated life
safety contractor, at Tenant's cost and expense. If Landlord shall fail to
respond to Tenant's written request for approval of any contractors proposed to
be engaged by Tenant (herein called an "Initial Contractors Request"), within
ten (10) Business Days after such Initial Contractors Request is made by Tenant,
with Landlord's approval or disapproval, the Tenant shall have the right to give
to Landlord a second notice (herein called a "Second Contractors Request"), and
if Landlord shall fail to respond to such Second Contractors Request within five
(5) Business Days after Landlord's receipt thereof with Landlord's written
approval or disapproval (any such disapproval to set forth in reasonable detail
the reason(s) therefor), then such Second Contractors Request shall be deemed
approved by Landlord, provided that such Initial Contractors Request and Second
Contractors Request shall have specifically referred to this Section 11.05(b)
and specifically stated that Landlord must respond within such ten (10) Business
Day and five (5) Business Day periods or such Second Contractors Request for
approval shall be deemed approved.
(c) Alterations shall be performed in such manner as
not to unreasonably interfere with or delay and as not to impose any additional
expense upon Landlord in the construction, maintenance, repair or operation of
the Building; and if any such additional expense shall be incurred by Landlord
as a result of Tenant's performance of any Alterations, Tenant shall pay such
additional expense within twenty (20) days after demand as Additional Charges.
Landlord shall endeavor in good faith to identify to Tenant in advance any
Additional Charges referred to in the preceding sentence of which Landlord is
aware upon written request by Tenant, but Landlord shall have no liability to
Tenant and Tenant shall not be released from its obligations pursuant to the
preceding sentence in the event Landlord is unable or fails so to identify any
such Additional Charges. Throughout the performance of Alterations, Tenant, at
its expense, shall carry, or cause to be carried, worker's compensation
insurance in statutory limits, all risk "Builders Risk" insurance and general
liability insurance, with completed operation endorsement, for any occurrence in
or about the Real Property, under which Landlord and the Manager and any
Superior Lessor and Superior Mortgagee whose name and address shall previously
have been furnished to Tenant shall be named as parties insured, in such limits
as Landlord may reasonably require (which amounts shall not exceed amounts
generally being required by landlords of office buildings or buildings
containing both office and retail use in the Times Square section of Manhattan
similar to the Building), with Acceptable Insurance Companies. Tenant shall
furnish Landlord with reasonably satisfactory evidence that such insurance is in
effect at or before the commencement of Alterations and, on request, at
reasonable
71
intervals thereafter during the continuance of Alterations. No Alterations shall
involve the removal of any fixtures, equipment or other property in the Premises
which are not Tenant's Property or Tenant's leasehold improvements without
Landlord's prior written consent, unless either (i) such fixtures, equipment or
other property shall be promptly replaced at Tenant's expense with comparable
fixtures, equipment or other property of like utility and at least equal value
or (ii) such fixtures, equipment or other property were installed by or on
behalf of Tenant, are in addition to and not in replacement of fixtures,
equipment or other property located in the Premises as of the Rent Commencement
Date to occur, and are removed by Tenant in the normal course of Tenant's
business, or (iii) such fixtures, equipment or other property are obsolete and
either serve no reasonable purpose in the Building or are replaced with
comparable, then-current models of such fixtures, equipment or other property.
11.06. Tenant agrees that the exercise of its rights pursuant
to the provisions of Article 11 or of any other provisions of this Lease or the
Exhibits hereto shall not be done in a manner which would violate Landlord's
union contracts affecting the Real Property, or create any work stoppage,
picketing, labor disruption or dispute or disharmony or any interference with
the business of Landlord. Tenant shall immediately stop work or other activity
if Landlord notifies Tenant (together with reasonable evidence thereof, which
evidence Landlord may submit to Tenant reasonably promptly after the fact if
same is not readily available to Landlord at the time that such stoppage is
required) that continuing such work or activity would violate Landlord's union
contracts affecting the Real Property, or create any work stoppage, picketing,
labor disruption or dispute or disharmony or any interference with the business
of Landlord.
11.07. Tenant, at its expense, and with diligence and
dispatch, shall procure the cancellation or discharge of all notices of
violation arising from or otherwise connected with the performance by or on
behalf of Tenant of Alterations, or any other work, labor, services or materials
done for or supplied to Tenant, or any person claiming through or under Tenant,
which shall be issued by the Department of Buildings of the City of New York or
any other public authority having or asserting jurisdiction. Subject to the
provisions of Section 18.03, hereof Tenant shall defend, indemnify and save
harmless Landlord from and against any and all mechanic's liens and encumbrances
(other than UCC-1 Financing Statements covering Tenant's Property) filed in
connection with Alterations, or any other work, labor, services or materials
done for or supplied to Tenant, or any person claiming through or under Tenant,
including, without limitation, security interests in any materials, fixtures or
articles so installed in and constituting part of the Premises and against all
costs, expenses and liabilities incurred in connection with any such lien or
encumbrance or any action or proceeding brought thereon, if such liens or
encumbrances are not satisfied or discharged as provided. Tenant, at its
expense, shall procure the satisfaction or discharge of record, by bonding in
the manner prescribed by law or otherwise, of all such liens and encumbrances
within twenty (20) days after Tenant has received actual notice of the filing
thereof. However, nothing herein contained shall prevent
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Tenant from contesting, in good faith and at its own expense, any notice of
violation, provided that Tenant shall comply with the provisions of Section 8.02
hereof; provided, however, that the foregoing provisions of this sentence shall
not obviate the need for such satisfaction or discharge of record. The
provisions of this Section 11.07 shall not apply with respect to the Building
Work or any other work which may be performed by Landlord for or on behalf of
Tenant during the term of this Lease.
11.08. Tenant will promptly, upon the completion of an
Alteration deliver to Landlord "as-built" drawings or approved shop drawings of
any Alterations Tenant has performed or caused to be performed in the Premises,
if and to the extent (i) same are required to be prepared by applicable Legal
Requirements, or (ii) same are otherwise customarily prepared for Alterations of
a similar nature, or (iii) Tenant, in fact, actually prepares same.
Notwithstanding anything to the contrary contained herein, wherever this Lease
requires the submission of "as-built" drawings or approved shop drawings by
Tenant, Tenant may satisfy such obligation by submitting final marked drawings
except with respect to Alterations involving the electrical, sprinkler/life
safety or HVAC systems of the Building.
11.09. Except as provided in Article 45 hereof with respect to
leasehold mortgages, no fixtures and equipment (other than Tenant's Property)
installed or used by Tenant in the Premises shall be subject to UCC filings or
other recorded liens.
11.10. Tenant shall keep (or cause to be kept) records for
four (4) years of Tenant's Alterations costing in excess of $250,000 and of the
cost thereof. Tenant shall, within forty-five (45) days after demand by
Landlord, furnish to Landlord copies of such records and cost if Landlord shall
require same in connection with any proceeding to reduce the assessed valuation
of the Real Property, or in connection with any proceeding instituted pursuant
to Article 8 hereof or for any other bona fide reason or purpose.
11.11. In the event there are any violations of Legal
Requirements of record against the Building which prevent Tenant from obtaining
permits or approvals required in connection with any permitted Alterations
hereunder, then, provided such violations related to Legal Requirements which
are the responsibility of Landlord and not Tenant to comply with under this
Lease, Landlord shall, promptly after written notice from Tenant, take such
reasonable steps as are necessary to cure such violations and remove same of
record at Landlord's cost, subject to recoupment as Operating Expenses if and to
the extent permitted under Article 3 hereof.
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ARTICLE 12
Landlord's and Tenant's Property
12.01. All fixtures, equipment, improvements and appurtenances
attached to or built into the Premises at the commencement of or during the term
of this Lease, whether or not by or at the expense of Tenant, shall be and
remain a part of the Premises, shall, upon the expiration or sooner termination
of this Lease, be deemed the property of Landlord and shall not be removed by
Tenant, except as provided in Section 12.02. Notwithstanding the foregoing
provisions, upon notice to Tenant no later than ninety (90) days prior to the
Expiration Date or upon reasonable notice with respect to such earlier date upon
which the term of this Lease shall expire (herein called a "Removal Notice"),
subject to the provisions of Section 12.02 hereof, Landlord may require Tenant
to remove all or part of the foregoing fixtures, equipment, improvements and
appurtenances attached to or built into the Premises during the term of this
Lease by Tenant or its subtenants (excluding the Additional Tenant's Work);
provided, however, that:
(i) Tenant shall not be obligated to remove any such
fixtures, equipment, improvements and appurtenances
installed prior to the date of this Lease, or any
replacements of same made by Landlord or Tenant
during the term of this Lease (provided, if made by
Tenant, such replacements are reasonably limited to
the size and scope of the installation being
replaced), and
(ii) Tenant's obligation to remove fixtures, equipment,
improvements and appurtenances installed after the
date of this Lease shall be limited to:
(X) with respect to the Office Premises,
fixtures, equipment, improvements and
appurtenances which are not standard for
general office installations (herein called
"Non-Standard Office Items"), such as
kitchens (other than pantries or so-called
"xxxxx units"), vaults, private restrooms,
raised or reinforced flooring, slab cuts
(other than slab cuts for conduits, wiring
and plumbing not to exceed (A) two (2)
openings per floor no larger than 18 inches
by 18 inches each and (B) twenty (20)
openings per floor the restoration of which
does not involve restoration of structural
steel and which are no larger than 2 inches
by 2 inches each except that each such 2
inch by 2 inch opening may terminate in a
slab recess of up to 6 inches by 6 inches
for a utility box or similar installation),
elevators, escalators, internal stairways,
generators
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and uninterrupted power supply systems and
associated equipment, and antennas,
satellite dishes and microwave
communications facilities and associated
equipment, and signage installed by Tenant
or any subtenant or occupant acting under or
through Tenant in the Premises or in or on
the Building, and
(Y) in the case of the Retail Premises, any and
all trade fixtures and equipment of any
tenant or occupant of the Retail Premises,
vaults, raised or reinforced flooring,
elevators (other than the Permitted Retail
Elevators, as such term is defined in this
Section 12.01), escalator, internal
stairways (other than the Permitted Retail
Staircase, as such term is defined in this
Section 12.01), generators and uninterrupted
power supply systems and associated
equipment, antennas, satellite dishes and
microwave communications facilities and
associated equipment, signage installed by
Tenant or any subtenant or occupant acting
under or through Tenant in the Premises or
in or on the Building, and slab cuts other
than:
(I) slab cuts for conduits, wiring and
plumbing in the second, third,
fourth and fifth floor slabs not to
exceed (A) two (2) openings per
floor no larger than 18 inches by
18 inches each and (B) twenty (20)
openings per floor the restoration
of which does not involve
restoration of structural steel and
which are no larger than 2 inches
by 2 inches each except that each
such 2 inch by 2 inch opening may
terminate in a slab recess of up to
6 inches by 6 inches for a utility
box or similar instal1ation;
(II) slab cuts in the first floor slab
and/or the slab of the cellar floor
for conduits, wiring and plumbing
not to exceed (A) four (4) openings
per floor no larger than 18 inches
by 18 inches each, (B) ten (10)
openings per floor no larger than
12 inches by 12 inches each, and
(C) twenty (20) openings per floor
the restoration of which does not
involve restoration of structural
steel and which are no larger than
2 inches by 2 inches each except
that each such 2 inch by 2 inch
opening may terminate in a slab
recess of up to 6 inches by 6
inches for a utility box or similar
installation; and
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(III) slab cuts in the first, second and third floors of
the Retail Premises not exceeding 150 square feet in
the aggregate per floor for up to two elevators
within the Retail Premises connecting some or all of
the Below-Grade Premises, first, second and third
floors (herein called the "Permitted Retail
Elevators"), and
(IV) slab cuts in the first, second and third floors of
the Retail Premises not exceeding 200 square feet in
the aggregate per floor for an internal staircase
connecting some or all of the Below-Grade Premises,
first, second and third floors (herein called the
"Permitted Retail Staircase"); and
(Z) with respect to the Building lobby, any audio/video equipment
installed by Tenant, and any other installations or
improvements made by Tenant which substantially reduce the
floor area of the Building Lobby or, in the case of relocated
interior walls, which substantially reduce the floor area of
either the Building Lobby or the Retail Premises, but
excluding any concierge desk in the Building Lobby the
installation of which does not involve Alterations of a
structural nature,
(all items required to be removed from the Premises as hereinabove set forth in
this Section 12.01 being herein collectively called the "Removal Items"). No
slab cuts existing on the date of this Lease shall constitute Removal Items. In
addition, slab cuts reasonably required for installation of restrooms in the
Retail Premises shall not constitute Removal Items. Tenant shall remove any
Removal Items required by Landlord pursuant to this Section 12.01 from the
Premises prior to the expiration, of this Lease at Tenant's expense. Upon such
removal Tenant shall immediately and at its expense, repair and restore the
Premises to the condition existing prior to installation (except that Tenant.
shall not be required to restore the original finishes to any area affected by
removal of any Removal Items if such area is returned to Landlord finished to a
higher standard than the finish existing on the date of this Lease, provided
such upgraded finish is not itself a Removal Item) and repair any damage to the
Premises due to such removal. Landlord agrees that if Tenant shall, in
connection with a request for approval of any Alteration, specifically request
in writing that Landlord advise Tenant whether Landlord believes that such
Alteration is or includes one or more Removal Item(s), and provided that such
notice shall make specific reference to this Section 12.01 land to the fact that
Tenant is not obligated to remove items which are not Removal Items upon the
expiration or earlier termination of this Lease, Landlord shall advise Tenant in
writing whether Landlord believes such Alteration is or includes one or more
Removal Item(s) (and specifically identifying such Removal Items) simultaneously
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with granting Landlord's approval of such Alteration. Tenant shall have the
right to dispute Landlord's determination of whether such Alteration is or
includes one or more Removal Item(s) provided Tenant gives Landlord written
notice of such dispute within thirty (30) days after Landlord notifies Tenant of
its determination (or if Tenant has not requested such a determination as herein
provided, within thirty (30) days after Landlord gives a Removal Notice with
respect to such Alteration). Any such dispute which is not resolved within
fifteen (15) days after the giving of Tenant's notice of such dispute may be
submitted by either party for resolution by Expedited Arbitration.
12.02. All movable partitions, furniture systems, special cabinet work,
business and trade fixtures, machinery and equipment, communications equipment
(including, without limitation, telephone system and security system) and office
equipment, and all conduits and wiring related to any of the foregoing property
described in this Section 12.02, whether or not attached to or built into the
Premises, which are installed in the Premises by or for the account of Tenant
and can be removed without structural damage to the Building, and all furniture,
furnishings and other articles of movable personal property owned by Tenant and
located in the Premises (all of the foregoing being herein collectively called
"Tenant's Property") shall be and shall remain the property of Tenant and may be
removed by Tenant at any time during the term of this Lease; provided that if
any of Tenant's Property is removed, Tenant shall repair or pay the cost of
repairing any damage to the Premises or to the Building resulting from the
installation and/or removal thereof. Tenant shall not be obligated to remove
conduits or wiring.
12.03. At or before the Expiration Date of this Lease (or within 15
days after any earlier termination of this Lease) Tenant, at its expense, shall
remove from the Premises all of Tenant's furniture, equipment (including,
without limitation, telecommunications equipment, exclusive of wiring and
cabling) and other moveable personal property not affixed or attached to the
Premises (except for such items thereof as Landlord shall have expressly
permitted to remain, which property shall become the property of Landlord), and
Tenant shall repair any damage to the Premises resulting from any installation
and/or removal of Tenant's Property.
12.04. Any other items of Tenant's Property which shall remain in the
Premises after the Expiration Date of this Lease, or within 15 days following an
earlier termination date, may at the option of Landlord, be deemed to have been
abandoned, and in such case such items may be retained by Landlord as its
property or disposed of by Landlord, without accountability, in such manner as
Landlord shall determine, at Tenant's expense.
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ARTICLE 13
Repairs and Maintenance
13.01. Tenant shall, at its expense, throughout the term of this Lease,
take good care of and maintain in good order and condition the Premises, and the
fixtures and improvements therein including, without limitation, the property
which is deemed Landlord's pursuant to Section 12.01 hereof and Tenant's
Property, except as otherwise expressly provided in this Section 13.01. Tenant
shall be responsible for all repairs, interior and exterior, structural and
non-structural, ordinary and extraordinary, foreseen or unforeseen, in and to
the Premises, and shall be responsible for the cost of all repairs, interior and
exterior, structural and non-structural, ordinary and extraordinary, foreseen or
unforeseen, in and to the Building and the facilities and systems thereof, the
need for which arises out of (a) the performance or existence of Alterations,
(b) the installation, use or operation of the property which is deemed
Landlord's, pursuant to Sections 12.01 hereof and Tenant's Property, (c) the
moving of the property by or on behalf of Tenant which is deemed Landlord's
pursuant to Sections 12.01 hereof, and/or the moving by or on behalf of Tenant
of Tenant's Property, in or out of the Building, (d) the act (other than mere
occupancy of the Premises for the purposes permitted under this Lease),
omission, misuse or neglect of Tenant or any of its subtenants or its or their
employees, agents, contractors or invitees or (e) design flaws in any of
Tenant's plans and specifications regardless of the fact that such Tenant's
plans may have been approved by Landlord. Tenant, at its expense, shall promptly
replace or repair all scratched, damaged or broken doors and glass (and the
solar film, if any, attached to the window glass) in and about the Premises,
including, without limitation, entrance doors and shall be responsible for all
repairs, maintenance and replacement of wall and floor coverings in the Premises
and for all the repair, maintenance and replacement of all horizontal portions
of the systems and facilities of the Building and all portions of the systems
and facilities of the Building installed by Tenant, including, without
limitation, the sanitary and electrical fixtures and equipment therein. All
repairs in or to the Premises for which Tenant is responsible shall be promptly
performed by Tenant in a good and workmanlike manner; provided, however, any
repairs in and to the facilities and systems of the Building and/or to the
exterior of the Building, including, without limitation, the windows thereof,
and/or to the structural elements of the Building shall be performed by
contractors approved in writing in advance by Landlord, such approval not to be
unreasonably withheld. All repairs for which Tenant is responsible hereunder
shall be performed in accordance with and subject to the provisions of Article
11 hereof. Notwithstanding the foregoing provisions of this Section 13.01, (a)
Tenant shall not be responsible for (except for payment of the costs of such
items as Operating Expenses if and to the extent provided in Article 3 hereof)
repairs to or replacements of the roof or any structural elements of the
Building or any portions of the Building Systems installed by Landlord as part
of the Building Work, except to the extent the need for any of the foregoing
repairs or replacements arises from the matters set forth in clauses (a), (c),
(d) or (e) of
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the second sentence of this Section 13.01., and (b) Tenant shall not be deemed
to be in default of its obligations to make any repairs to the Premises pursuant
to this Section 13.01 if and to the extent Tenant is unable to do so by reason
of Tenant Force Majeure Causes, but Tenant shall commence such repairs promptly
after the cessation of such Tenant Force Majeure Causes and thereafter
diligently pursue same to completion.
13.02. Tenant shall give Landlord prompt notice of any defective
condition in any Building System located in, servicing or passing through the
Premises of which it has actual knowledge. Following such notice, Landlord shall
promptly and diligently remedy the conditions, at the expense of Tenant if
Tenant is responsible for same under the provisions of this Article 13 or, if
Tenant is not responsible for same under the provisions of this Article 13, then
at Landlord's expense, subject to recoupment of same as Operating Expenses if
and to the extent provided in Article 3 hereof.
13.03. Except as otherwise expressly provided in this Lease, Landlord
shall have no liability to Tenant, nor shall Tenant's covenants and obligations
under this Lease be reduced or abated in any manner whatsoever, by reason of any
inconvenience, annoyance, interruption or injury arising from Landlord's making
any repairs or changes which Landlord is required or permitted to make by this
Lease, or required by law, to make in or to the fixtures, equipment or
appurtenances of the Building or the Premises (e.g., in the event Tenant fails
to make a repair for which Tenant is responsible under this Lease or in the
event of changes required by future Legal Requirements for which Landlord is
responsible under this Lease, it being acknowledged and agreed that except as
otherwise expressly provided in this Lease, Landlord shall not have the right to
make alterations or improvements of a voluntary or optional nature to the
Premises during the term of this Lease and is not required to make any
alterations, improvements or repairs to the Building except to the extent
otherwise expressly provided in this Lease); provided, however, that Landlord
shall use reasonable efforts to the extent practicable to make such repairs and
changes at such times and in such manner as to minimize interference with the
conduct of Tenant's business in the Premises, but Landlord shall not be
required to perform any such work on an overtime or premium-pay basis, unless
the performance of such work during Tenant's regular business hours or the delay
in performing such work would materially adversely affect the conduct of
Tenant's business in the Premises or access to and from the Building, in either
of which cases Landlord shall use overtime or premium-pay labor to the extent
the use of same is practicable under the circumstances. Landlord shall repair
any damage to Tenant's Property or Tenant's leasehold improvements resulting
from any work performed by Landlord pursuant to this Section 13.03. Landlord
shall not, however, be required to make or pay for any repairs referred to in
the preceding sentence required to be made to Tenant's Property by reason of any
Insured Losses.
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13.04. Landlord shall maintain and repair, at Landlord's expense
subject to recoupment as Operating Expenses if and to the extent provided in
Article 3 hereof, the portions of the Building Systems installed by Landlord as
part of the Building Work, to the extent such maintenance and repairs are not
the responsibility of Tenant pursuant to any other provision of this Lease. In
no event shall the provisions of this Section 13.04 be deemed to obligate
Landlord to make repairs, the need for which arises from the causes enumerated
in clauses (a), (c), (d) or (e) of the second sentence of Section 13.01 hereof
or from Insured Losses to Tenant's Property or from the negligence or willful
misconduct of Tenant, its employees, agents or contractors.
13.05. Landlord shall maintain and repair, at Landlord's expense
subject to recoupment as Operating Expenses if and to the extent provided in
Article 3 hereof, the following elements of the Building to the extent the same
affect Tenant's use and enjoyment of the Premises and to the extent such
maintenance and repairs are not the responsibility of Tenant pursuant to any
other provision of this Lease: the roof, facade, structural columns, load
bearing walls and other structural elements. In no event shall the provisions of
this Section 13.05 be deemed to obligate Landlord to make repairs, the need for
which arises from the causes enumerated in clauses (a), (c), (d) or (e) of the
second sentence of Section 13.01 hereof or from Insured Losses to Tenant's
Property or from the negligence or willful misconduct of Tenant, its employees,
agents or contractors.
13.06. If Landlord is obligated to perform any maintenance or make any
repair or replacement pursuant to this Article 13 or the last sentence of
Section 16.01 hereof or Section 16.05 hereof and Landlord fails to commence such
maintenance, repair or replacement within twenty (20) days after written notice
from Tenant and thereafter diligently prosecute such maintenance or repair to
completion, then Tenant may notify Landlord of such fact and Tenant's intention
to exercise its self-help and offset rights provided for in this Section 13.06
(herein called a "Section 13.06 Self-Help Notice"), which Section 13.06
Self-Help Notice shall state that Landlord has a period of fifteen (15) days
following the giving of such notice to dispute Tenant's right to exercise
self-help, a copy of which Section 13.06 Self-Help Notice shall be delivered
simultaneously to any Superior Lessor Superior Mortgagee whose name and address
shall have previously have been furnished to Tenant. If, within fifteen (15)
days after the giving of a Section 13.06 Self-Help Notice, Landlord shall fail
(except by reason of Force Majeure Causes) to commence or diligently pursue (as
the case may be) the maintenance, repair or replacement in question, then Tenant
may, at Tenant's election, perform or complete, as the case may be, such
maintenance, repair or replacement, in which event Landlord shall reimburse
Tenant for Tenant's Self-Help Costs to perform or complete such maintenance,
repair or replacement, together with interest thereon at the Interest Rate from
the date incurred until the date repaid to Tenant, within twenty (20) days after
delivery of an invoice to Landlord therefor. Tenant may deliver to Landlord an
Offset Notice together with such invoice or at any time thereafter, a copy of
which Offset Notice shall be delivered simultaneously to any Superior Lessor or
Superior Mortgagee
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whose name and address shall have previously have been furnished to Tenant. If
Landlord fails so to reimburse Tenant for such Self-Help Costs and interest
within twenty (20) days after delivery of an invoice (and provided Tenant shall
have sent an Offset Notice either together with the invoice or thereafter and
at least five (5) Business Days have passed since the giving of such Offset
Notice without Tenant having been reimbursed for such Self-Help Costs and
interest), Tenant may offset such unpaid Self-Help Costs against the next
installment(s) of Fixed Rent thereafter payable hereunder, together with
interest on such unpaid Self-Help Costs, from the date paid by Tenant to the
date offset by Tenant, at the Interest Rate. Notwithstanding anything to the
contrary contained in this 13.06, in the event that the maintenance, repair or
replacement in question relates to any structural elements of the Building, the
roof or facade of the Building or any Building System and Landlord notifies
Tenant in writing (herein called a "Section 13.06 Dispute Notice") within the
fifteen (15) day period following Landlord's receipt of a Section 13.06
Self-Help Notice that Landlord disputes that Landlord is obligated to perform
the maintenance, repair or replacement in question or Tenant's claim that
Landlord has failed to perform or complete same or Tenant's right to exercise
the self-help and offset rights in accordance with this Section 13.06, then (i)
Tenant may not exercise such self-help rights until a final resolution of such
dispute unless the failure to perform the maintenance or repair in question at
such time would materially adversely interfere with Tenant's use of the Premises
or the performance of any Alterations permitted hereunder in which event Tenant
may exercise such self-help rights notwithstanding Landlord's notice of dispute,
(ii) Tenant shall in no event have the right to exercise such offset rights
until such dispute has been finally resolved, and (iii) Landlord shall in no
event be responsible for any costs or expenses incurred by Tenant in exercising
such self-help rights if such dispute is resolved in Landlord's favor. Any such
dispute which is not resolved between the parties within ten (10) Business Days
after the giving of a Section 13.06 Dispute Notice may be submitted by either
party for resolution by Expedited Arbitration. If such dispute is resolved in
Tenant's favor, then, within ten (10) Business Days following resolution of such
dispute, Landlord shall reimburse Tenant for any Self-Help Costs owed to Tenant
pursuant to such resolution, together with interest thereon at the Interest Rate
from the date paid by Tenant to the date reimbursed to Tenant, failing which
Tenant may offset such unpaid Self-Help Costs against the next installment(s) of
Fixed Rent thereafter payable hereunder, together with interest on such unpaid
Self-Help Costs, from the date paid by Tenant to the date offset by Tenant, at
the Interest Rate.
ARTICLE 14
Electricity
14.01. Tenant agrees to be responsible for the cost of, and to purchase
from Landlord, all electricity consumed, used or to be used at the Building
including, without
81
limitation: (i) for Tenant's use in the Premises, (ii) for Landlord's use in the
operation, repair and maintenance of the Building and the delivery of the
services required to be provided by Landlord under the terms and conditions of
this Lease and (iii) by any Antennas (as such term is defined in Article 33
hereof), Signs (as such term is defined in Article 42 hereof) or other equipment
located outside of the Premises but used by Tenant in connection with this
Lease. Accordingly, the cost of any electricity consumed, used or to be used by
Landlord in the operation, repair and maintenance of the Building and the
delivery of the services required to be provided by Landlord under the terms and
conditions of this Lease shall not be included in the Operating Payment pursuant
to the provisions of Article 3 hereof. The amount to be paid by Tenant to
Landlord for electricity shall be the same amount paid by Landlord for such
electricity to the public utility or other provider of electricity, without
profit or markup of any kind; provided, however, that Tenant shall pay to
Landlord the amount of any sales tax that Landlord may, from time to time, be
required to collect from Tenant in connection with the resale of such
electricity to Tenant. Tenant shall be entitled to the full amount of any
discounts or rate reductions that the Building may be entitled to from time to
time, including, without limitation, the discounted rate available under
Consolidated Edison's Business Incentive Rate, but Landlord makes no
representations or warranties as to whether any such discounts or rate
reductions are or will be available or, if available, as to the amount thereof.
Bills for electricity shall be rendered by Landlord to Tenant with the same
frequency that such bills are rendered to Landlord by such public utility or
other provider of electricity, shall be accompanied by copies of the
corresponding bills of such public utility or other provider of electricity, and
shall be payable as an Additional Charge, within twenty (20) days after
rendition of any such xxxx.
14.02. There are four (4) direct meters serving the Building (herein
called the "Direct Meters"). Three of the Direct Meters serve the electrical
service coming into the Building from the Forty-Second (42nd) Street side and
are referred to herein respectively as "Meter One", "Meter Two" and "Meter
Three." The fourth Direct Meter serves the electrical service coming into the
Building from the Forty-First (41st) Street side and is referred to herein as
"Meter Four." The Direct Meters service switches have the following capacities:
Meter One 6,000 ampere switchboard with three (3) service switches
serving (i) general lighting and power throughout the
Building, (ii) the Retail Premises and (iii) the fire
pump, respectively;
Meter Two 1,200 ampere switch serving exterior displays;
Meter Three 1,200 ampere switch reserved for future use; and
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Meter Four 5,000 ampere switch serving all mechanical equipment of
the Building, including, without limitation, the air
conditioning units providing cooling to the Office
Premises.
Tenant covenants and agrees that at all times its installations and use of
electricity, when aggregated with all other Building facilities and equipment
whose electrical consumption is measured by such meters, shall never exceed the
capacities set forth above with respect to Meter One, Meter Two, Meter Three and
Meter Four, respectively. If Tenant requires additional power, Tenant shall, at
Tenant's sole cost and expense, provide and install in conformity with law any
additional riser or risers and/or any and all switch or switches to connect
additional power to the Premises, and such work shall be performed in accordance
with all of the provisions of Article 11 hereof governing the performance of
Material Alterations. If such additional power is not available, then upon
Tenant's request, Landlord, at Tenant's sole cost and expense, shall take such
steps as may be reasonably available to obtain additional power from the utility
company.
14.03. Landlord shall not in any way be liable or responsible to Tenant
for any loss, damage or expense which Tenant may sustain or incur if (i) the
supply of electric energy to the Premises is temporarily interrupted or (ii) the
quantity or character of electric service is changed or is no longer available
or suitable for Tenant's requirements, except to the extent resulting from
Landlord's negligence or wilful misconduct.
ARTICLE 15
Building Management and Services
15.01.(a) During the term of this Lease, the Building will be managed
and operated by a Building manager (herein called the "Manager") pursuant to a
management agreement (herein called the "Management Agreement") to be entered
into from time to time between Landlord and the Manager. Effective not later
than sixty (60) days after the execution of this Lease, Landlord shall terminate
the existing management agreement for the Building and enter into a Management
Agreement in the form annexed to this Lease as Exhibit M (the "Initial
Management Agreement") with either Xxxxxxx X. Xxxxxxx or a management company
which satisfies the requirements set forth in the second sentence of Section
15.01(b) and with which Xxxxxxx X. Xxxxxxx is affiliated, who will act as the
initial Manager hereunder. In the event of any conflict between this Lease and
the Management Agreement, this Lease will control as between Landlord and
Tenant. As more particularly set forth below in this Article 15 and in the
Initial Management Agreement, the Manager shall be obligated to operate the
Building Systems (including, without limitation, the elevators and HVAC
system), and Tenant shall have the right to give certain instructions to the
Manager in connection with the performance of such services.
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Accordingly, Landlord's obligations with respect to the provision of Building
services shall be limited to the obligations of Landlord expressly set forth in
this Article 15.
(b) Upon the expiration or termination of the Initial Management
Agreement or any successor Management Agreement for any reason, Landlord shall
either (i) enter into a renewal or extension of the Management Agreement then in
effect, or (ii) if such existing Management Agreement has been terminated "for
cause" or by reason of the resignation of the Manager thereunder, or upon
Landlord's election to terminate the Management Agreement or not renew it, or if
such Manager is unwilling to enter into a renewal or extension, enter into a new
Management Agreement with a new Manager. Any such new Manager shall be a
reputable, professional real estate management company which has been in the
real estate management business in Manhattan for not less than fifteen (15)
years and which shall, as of the date such Manager is engaged as Manager of the
Building, be performing building management services (i.e., services of a nature
and scope comparable to the nature and scope of services required to be
performed by the initial Manager under the Initial Management Agreement) under
written agreements for not less than 5,000,000 square feet of first class office
buildings or buildings containing both office and retail use in Manhattan in
addition to the Building. Tenant shall have the right to initially designate any
such new Manager, provided, however, that (i) any such new Manager designated by
Tenant shall be subject to Landlord's approval, such approval not to be
unreasonably withheld provided that such Manager shall in any event be capable,
in Landlord's reasonable judgment, of performing the accounting and reporting
functions required by Landlord with respect to the operation of the Property,
(ii) if Tenant fails to designate a new Manager within thirty (30) days after
written request therefor by Landlord, then such new Manager shall be designated
by Landlord. Any new Management Agreement entered into by Landlord pursuant to
this Section 15.01 shall be on substantially the same terms and conditions as
the Initial Management Agreement, with such modifications thereto as may be
required by Landlord or the Manager thereunder, provided such modifications
shall have been approved by Tenant, such approval not to be unreasonably
withheld or delayed. Notwithstanding the foregoing, each Management Agreement
shall provide for (i) a term of one (1) year and shall be automatically extended
for successive one (1) year periods unless and until terminated as provided in
the Initial Management Agreement, (ii) a management fee not to exceed one and
one-half (1-1/2%) percent of the Fixed Rent payable under this Lease, and (iii)
termination of the Manager thereunder "for cause" which shall have substantially
the same meaning as termination of the initial Manager "for cause" under the
Initial Management Agreement. During any interim period between the expiration
or termination of the Initial Management Agreement (or any successor Management
Agreement) and the execution of a new Management Agreement in replacement
therefor, the Building shall be managed by, at Landlord's election, either (i)
(X) Landlord or an affiliate of Landlord or (Y) Cornerstone Real Estate
Advisers, Inc. (herein called "Cornerstone") or an affiliate of Cornerstone, but
Cornerstone or an affiliate of Cornerstone may be the manager only for so long
as Massachusetts Mutual Life Insurance Company or its affiliate is Landlord, or
(ii)
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a reputable third party real estate management company designated by Landlord as
an interim manager (but if such interim period exceeds 60 days, the interim
manager for the balance of such interim period shall be selected by Tenant),
upon substantially the same terms and conditions as are contained in the
then-most recent Management Agreement.
(c) The Initial Management Agreement provides (and any successor or
replacement Management Agreement shall provide) that the Manager is an
independent contractor (and not the agent for any purpose) of Landlord. As more
particularly set forth in the Initial Management Agreement, the Manager shall
(i) employ the Building staff, (ii) operate the Building Systems, including the
provision of overtime elevator, HVAC or other services, and (iii) prepare the
Operating Budget for each Operating Year subject to and in accordance with
Section 3.05 hereof. In addition to the foregoing, the Manager will operate the
Building Systems so as to provide services to the Building during such hours and
on such days as may be directed by Tenant, and Tenant shall be responsible for
scheduling such services directly with the Manager. In addition to the
management fee and any other recurring costs and expenses under the Management
Agreement which are included in Tenant's Operating Payment, Tenant shall be
responsible for all additional costs and expenses payable or reimbursable to the
Manager under the terms of the Management Agreement (including, without
limitation, overtime and premium-pay labor charges) for any work or services
performed by the Manager under the Management Agreement, other than work or
services specifically requested by Landlord and which have not been requested by
Tenant, or work required by reason of any repair which Landlord is obligated to
make under this Lease and which Landlord fails to make or makes incorrectly or
any other default of Landlord under this Lease, or work or services which
Landlord is required to perform or provide at Landlord's cost under this Lease
without recoupment from Tenant. Such additional costs and expenses shall be
invoiced, at Landlord's election, by Landlord or Manager to Tenant and shall be
paid by Tenant to Landlord, within twenty (20) days after delivery of such an
invoice as Additional Charges hereunder. Upon request from Tenant, Landlord
shall provide copies of any bills received from third parties on which any such
additional costs and expenses are based.
(d) Tenant shall have the right to notify Landlord (herein called a
"Non-Performance Notice") at any time that Tenant believes that the Manager has
failed on a material basis to provide the services or perform the obligations
required under the Management Agreement or that other circumstances exist
entitling Landlord to terminate the Manager "for cause" under the Management
Agreement, which Non-Performance Notice shall set forth in reasonable detail the
basis for Tenant's beliefs. Promptly upon receipt of a Non-Performance Notice,
Landlord shall investigate the statements contained therein and take reasonable
steps to enforce the obligations of Manager under the Management Agreement,
including, without limitation, notifying the Manager in writing of any defaults
existing under the Management Agreement. If the circumstances set forth in a
Non-Performance Notice have not been cured within a reasonable period of time
following the giving of such Non-Performance Notice (which
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shall in any event be no shorter than the applicable cure period provided in the
Management Agreement), or if such circumstances constitute grounds for
termination for which no cure period is provided under such Management
Agreement, then, if specifically requested in writing by Tenant (herein called
a "Manager Termination Notice"), which Manager Termination Notice states that
Landlord has a period of ten (10) days following the giving of such Manager
Termination Notice to dispute Tenant's right to require termination of the
Management Agreement, Landlord shall terminate the Management Agreement. If
Landlord shall fail to take the necessary steps under the Management Agreement
to terminate same within ten (10) days after the giving of a Manager Termination
Notice, then Tenant shall have the right to terminate the Management Agreement
by giving the Manager a notice (herein called a "Direct Tenant Termination
Notice") of such termination, provided however that Tenant shall not have the
right to give a Direct Termination Notice in the event Landlord disputes, not
later than ten (10) days following the giving of a Manager Termination Notice,
that grounds exist for the termination of the Management Agreement. Any such
dispute between the parties which is not resolved within ten (10) days after
Landlord so notifies Tenant shall be resolved by Expedited Arbitration. The
Initial Management Agreement and each subsequent Management Agreement entered
into hereunder shall specifically set forth Tenant's rights to send a Direct
Termination Notice in accordance with the provisions of this Section 15.01(d).
(e) (i) Landlord shall cause the Manager to prepare an operating
budget for the Building (herein called the "Operating Budget") in accordance
with the Management Agreement which Operating Budget shall be substantially in
the form annexed to this Lease as Exhibit F. The Budget shall incorporate all
costs and expenses reasonably anticipated by Landlord or Manager to constitute
Operating Expenses for the Operating Year covered by such Operating Budget to
the extent then known to Landlord or the Manager, and shall separately identify
all expenses thereon which are reimbursable by Tenant as Operating Expenses or
otherwise under this Lease and all expenses which are Landlord's responsibility
under this Lease. Without limiting the foregoing, the Operating Budget shall
contain (A) the estimated cost for all service contracts for the maintenance and
repair of the Building Systems and the normal maintenance and repair of the
roof, facade and/or structural elements of the Building (herein called "Building
Systems Service Contracts"), (B) the estimated cost of all service contracts
with third-party vendors for cleaning, security, concierge and other similar
services to Tenant in the Building and not related to the maintenance, operation
or repair of the Building Systems (herein called "Tenant Services Contracts"),
(C) the estimated cost of all wages, salaries and benefits for personnel
employed by Landlord or the Manager to the extent such costs are includable in
Operating Expenses ("Building Personnel"), (D) the cost of insurance required to
be maintained by Landlord with respect to the Building, and (B) the management
fee payable to the Manager.
(ii) Landlord agrees to endeavor to have the Manager prepare a draft of
the Operating Budget for each operating year no later than 60 days prior to the
commencement of
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such Operating Year (and, with respect to the Operating Year commencing January
1, 2000, no later than 30 days after the date of this Lease), and Landlord shall
deliver a copy of the draft Operating Budget to Tenant promptly after the same
has been prepared. Following the delivery of a draft Operating Budget to Tenant,
Landlord agrees to meet and cause the Manager to meet with Tenant at a mutually
convenient time at the Building or at the offices of the Manager in Manhattan to
discuss the Operating Budget and any comments of Tenant with respect thereto,
and Landlord agrees to correct any errors contained in such Operating Budget
following such meeting (but if Landlord disputes whether the Operating Budget
contains any such errors, Tenant shall pay estimated Operating Payments in
accordance with Landlord's position with respect to such Operating Budget,
subject to Tenant's rights of inspection, audit, contest and offset with respect
to Operating Statements as set forth in Article 3 hereof). It is understood and
agreed that the Operating Budgets will be prepared and submitted to Tenant for
planning and informational purposes only and will not be deemed to (A) modify
the nature, type or amount of Operating Expenses for which Tenant is liable
pursuant to Article 3 of this Lease, or (B) modify the rights of Landlord
pursuant to Article 3 hereof to furnish revised estimates of Operating Expenses
during the course of any Operating Year and Tenant's obligation pursuant to
Article 3 to make monthly payments on account of such revised estimates, or (C)
modify Tenant's obligation to pay Additional Charges pursuant to Article 3, this
Article 15 or any other provision of this Lease, or (D) limit Tenant's rights
specifically set forth in this Lease to dispute Operating Statements or other
Additional Charges payable by or (E) the rights of Landlord or Tenant pursuant
to subsection 15.01(e)(iii) below.
(iii) The Operating Budget shall be prepared based upon the following
principles, and Landlord and Tenant agree as follows:
(A) during the term of this Lease, Tenant shall have the right to
require reasonable changes in the number of Building Personnel
provided and on condition that: (1) the foregoing shall not be
deemed to require Landlord or the Manager to take any action
in violation of any applicable labor agreements to which
Landlord or the Manager is a party with respect to the
Building, and (2) there shall at all times be sufficient
Building Personnel, in Landlord's reasonable judgment, for the
proper operation of all Building Systems;
(B) the Manager shall competitively bid all Tenant Services
Contracts to not less than three (3) bidders. Landlord and
Tenant shall each have the right to name one or more reputable
contractors to bid on any such Tenant Services Contracts, but
tenant shall have the right to select the successful bidder
from among those submitting bids and the bidder selected by
Tenant need not be the lowest bidder. The specifications for
any cleaning
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contract shall be as provided in Section 15.02 hereof and the
specifications for any other Tenant Services Contracts shall
be as designated by Tenant, and in the case of the Tenant
Services Contract(s) for Building security services, approved
by Landlord in advance, such approval not to be unreasonably
withheld or delayed.
(C) the Manager shall competitively bid all Building Systems
Service Contracts to not less than three (3) bidders, except
that Landlord shall have the right in its sole discretion to
engage the manufacturer of any Building System as the vendor
under the Building System Service Contract for such system
without bidding provided such manufacturer's charges for such
services are commercially reasonable. Tenant confirms that it
has received a copy of the initial Building System Service
Contract with the manufacturer of the Building's elevators and
that such agreement is acceptable to Tenant in all respects.
With respect to any Building Systems Service Contracts which
are to be bid as provided in the preceding sentence, same
shall be competitively bid to at least three (3) reputable
service providers, and Tenant shall have the right to name one
or more bidders permitted to bid on such Building Systems
Service Contracts, but the selection of any such service
contractor and the determination of the specifications for
such Building Systems Service Contracts shall be made by
Landlord in its sole discretion, provided that the
specifications selected by Landlord are of a quality and scope
at least comparable to the specifications for such Building
Systems Service Contracts customarily used in comparable
office buildings or buildings containing both office and
retail use in midtown Manhattan and provided that the charges
for the vendor selected by Landlord shall be commercially
reasonable.
(f) Landlord shall not amend any Management Agreement in effect from
time to time in a manner which would adversely affect Tenant's rights with
respect to the Management Agreement as specifically set forth in this Article 15
without the prior written consent of Tenant.
(g) Tenant shall have the right to require Landlord to terminate the
Management Agreement and Manager then in effect at any time without cause
provided that (i) Tenant shall not have the right to require such a termination
prior to the fifth (5th) anniversary of the Commencement Date, and (ii) Tenant
shall not have the right to require such a termination more than once in any
five (5) year period.
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(h) Landlord shall deliver to Tenant copies of all notices of default
or termination given by Landlord to the Manager under the Management Agreement
concurrently with delivery of same to the Manager.
(i) Landlord shall deliver to Tenant (or cause Manager to deliver to
Tenant) copies of the following monthly accounting report prepared by Manager
under the Management Agreement promptly after same is prepared: Monthly Building
Expense Report.
(j) Landlord agrees to consult with Tenant and take due consideration
of any concerns expressed by Tenant prior to terminating any Management
Agreement without cause, provided that this clause (j) shall not apply in the
case of a termination of the Management Agreement in connection with a sale or
net or ground lease of the Premises.
(k) Landlord agrees to consult with Tenant prior to terminating any
Management Agreement for cause, except in cases of fraud, misappropriation of
funds or emergency circumstances.
15.02 (a) Landlord shall cause the Building (excluding the Retail
Premises and the storefront thereof) including, without limitation, the exterior
and the interior of the windows thereof, to be cleaned in accordance with the
specification annexed hereto as Exhibit N-1 (the "Initial Cleaning
Specification"), and for such purpose shall enter into (or cause the Manager to
enter into) a cleaning contract with the cleaning contractor selected after
competitive bidding in accordance with the Management Agreement, such cleaning
contract to be in form and substance reasonably satisfactory to Tenant and
Landlord. Tenant shall have the right to (i) amend or modify the Initial
Cleaning Specification in connection with the bidding of any replacement to such
Initial Replacement Contract, provided that the modified specification provides
for cleaning at a standard at least as high as the minimum cleaning
specification annexed hereto as Exhibit N-2, and (ii) require Landlord to
exercise any rights or remedies under the cleaning contract in the event of the
failure of the cleaning contractor to perform in accordance with such contract,
provided, that Tenant shall defend, indemnify and save harmless Landlord from
and against any and all claims, losses, costs, damages and expenses (including,
but not limited to, reasonable counsel fees, subject to Section 18.03 hereof)
resulting from any such actions taken by Landlord at Tenant's request. All
amounts payable to the cleaning contractor under the cleaning contract for the
performance of regularly scheduled cleaning services and other recurring charges
thereunder shall be included in Operating Expenses. All other amounts payable to
the cleaning contractor under the cleaning contract (such as, for example,
charges for supplemental cleaning requested by Tenant or additional charges for
cleaning assessed by the cleaning contract or by reason of Tenant's misuse or
neglect on the part of Tenant or its subtenants or its or their employees or
visitors or non-standard materials or finishes installed by Tenant or at its
request) shall be paid by Tenant to Landlord as Additional
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Charges within twenty (20) days after delivery of an invoice therefor, which
shall be accompanied by a copy of the corresponding invoice delivered to
Landlord by the cleaning contractor. Landlord's cleaning contractor and its
employees shall have access to the Premises during the hours specified in the
cleaning contract for the purposes permitted thereunder (and Landlord's or the
Manager's employees Shall have reasonable access for the purposes of supervising
such work) and shall have the right to use, without charge therefor, all light,
power and water in the Premises reasonably required to clean the Premises as
required under this subsection 15.02. Tenant shall not clean, nor require,
permit, suffer or allow any windows in the Premises to be cleaned, from the
outside in violation of Section 202 of the Labor Law, or any other applicable
law.
(b) Tenant shall, at Tenant's sole cost and expense, keep the Retail
Premises clean (including, without limitation, the interior and exterior of the
windows and doors and the frames thereof) and shall cause all rubbish to be
removed therefrom on a daily basis.
15.03. Intentionally omitted.
15.04. Except as otherwise expressly provided in this Lease, Landlord
shall not be required to provide any services to the Premises.
15.05. Subject to the provisions of Section 35.04(b) and 35.04(c) and
Articles 19 and 20 hereof, Landlord reserves the right, without liability to
Tenant and without it being deemed a constructive eviction, to stop or interrupt
any heating, elevator, escalator, lighting, ventilating, air-conditioning,
steam, power, electricity, water, cleaning or other service and to stop or
interrupt the use of any Building facilities and systems at such times as may be
necessary and for as long as may reasonably be required by reason of accidents,
strikes, or the making of repairs, alterations or improvements required to be
made by Landlord hereunder, or inability to secure a proper supply of fuel, gas,
steam, water, electricity, labor or supplies, or by reason of any other similar
or dissimilar cause beyond the reasonable control of Landlord. Subject to the
provisions of Section 35.04(b) and 35.04(c) and Articles 19 and 20 hereof, no
such stoppage or interruption shall result in any liability from Landlord to
Tenant or entitle Tenant to any diminution or abatement of Fixed Rent or
Additional Charges or other compensation nor shall this Lease or any of the
obligations of Tenant be affected or reduced by reason of any such stoppage or
interruption. Landlord shall give Tenant reasonable prior notice, except in
emergencies (in which case Landlord shall give such prior notice, if any, as is
reasonable under the circumstances), of its intention to make any repairs,
alterations or improvements referred to in this Section 15.05 or any other
stoppages of services of which Landlord has prior notice and shall use
reasonable efforts in making such repairs, alterations or improvements and in
dealing with such other stoppages of service so as to minimize interference with
Tenant's business operations provided that Landlord shall not be required to
perform any such work on an
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overtime or premium-pay basis, unless the performance of such work during
Tenant's regular business hours or the delay in performing such work would
materially adversely affect the conduct of Tenant's business in the Premises or
access to and from the Building, in either of which cases Landlord shall use
overtime or premium-pay labor to the extent the use of same is practicable under
the circumstances.
15.06. In addition to any remedies which Landlord may have
under this Lease, and without reducing or adversely affecting any of Landlord's
rights and remedies contained elsewhere in this Lease, if there shall be a
default hereunder by Tenant which shall not have been remedied after the giving
of notice and the expiration of any applicable grace period, Landlord shall have
the right to direct that the Manager not furnish to Tenant or the Premises any
services for which an additional charge not included in Tenant's Operating
Payment would be incurred unless such additional charge is paid for by Tenant in
advance; and the discontinuance of any one or more such services shall be
without liability by Landlord to Tenant and shall not reduce, diminish or
otherwise affect any of Tenant's covenants and obligations under this Lease.
ARTICLE 16
Access
16.01. Landlord reserves the right, and Tenant shall permit
Landlord and persons authorized by Landlord, to install, erect, use and maintain
pipes, ducts and conduits in and through the Premises but only to the extent
reasonably necessary to comply with Landlord's obligations under this Lease or
to remedy any default by Tenant in the performance of its obligations under this
Lease (it being acknowledged and agreed that except as otherwise expressly
provided in this Lease, Landlord shall not have the right to make alterations or
improvements of a voluntary or optional nature to the Premises during the term
of this Lease); provided that (a) such installations shall be at Landlord's cost
and expense (but subject to inclusion as Operating Expenses if and to the extent
permitted under Article 3 hereof) and, to the extent practicable, shall be
located in boxed enclosures and appropriately furred, and (b) in performing such
installation work, Landlord shall use reasonable efforts not to interfere with
Tenant's use of the Premises without any obligation to employ overtime services,
unless the performance of such work during Tenant's regular business hours or
unless the delay in performing such work would materially adversely affect the
conduct of Tenant's business in the Premises or access to and from the Building,
in either of which cases Landlord shall use overtime or premium-pay labor to the
extent the use of same is practicable under the circumstances. Any damage to the
Premises or Tenant's Property resulting from Landlord's exercise of the
foregoing
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right shall be repaired promptly by Landlord, at Landlord's expense, and in the
event Landlord fails to do so, the provisions of Section 13.06 shall apply with
respect thereto.
16.02. Landlord and persons authorized by Landlord shall have
the right, upon reasonable advance notice, except in cases of emergency (in
which case Landlord shall give such prior notice, if any, as is reasonable under
the circumstances), to enter the Premises at reasonable times provided Landlord
shall use reasonable efforts to minimize any interference with Tenant's business
operations (without obligation to make such visits during non-business hours,
except that the repairs, alterations, additions and improvements referred to in
subparagraph (b) hereof shall be made on an overtime or premium-pay basis to
the extent Landlord is required to do so under the applicable provision of this
Lease) and shall be accompanied by a designated representative of Tenant if
Tenant shall have made such representative available to Landlord, (a) to examine
the Premises and to show them to actual and prospective Superior Lessors or
Superior Mortgagees, or prospective purchasers or mortgagees of the Building,
(b) to make such repairs, alterations, additions and improvements in or to the
Premises or its facilities and equipment as Landlord is required to make under
the terms of this Lease, and (c) to read any utility meters located therein.
Landlord and such authorized persons shall be allowed to take all materials into
and upon the Premises that may be required in connection therewith, without any
liability to Tenant and without any reduction of Tenant's covenants and
obligations hereunder; provided, however, that Landlord agrees that Landlord
shall not store materials for any alterations or improvements being performed by
Landlord beyond those required for the current day's work in any area of the
Premises where such storage would materially adversely affect the conduct of
Tenant's business.
16.03. If at any time any windows of the Premises are either
temporarily or permanently darkened or obstructed if required by Legal
Requirements, or covered by any translucent material for the purpose of energy
conservation, the same shall be without liability to Landlord and without any
reduction or diminution of Tenant's obligations under this Lease.
16.04. During the period of eighteen (18) months prior to the
expiration date of this Lease, Landlord and persons authorized by Landlord may
exhibit the Premises to prospective tenants.
16.05. Any damage to the Premises resulting from the exercise
by Landlord of its rights granted under this Article 16 shall be promptly
repaired by Landlord at Landlord's expense, and in the event Landlord fails to
do so, the provisions of Section 13.06 shall apply with respect thereto.
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ARTICLE 17
Notice of Occurrences
17.01. Tenant shall give notice to Landlord, promptly after
Tenant has actual knowledge of same, of (a) any occurrence in or about the
Premises for which Landlord might be liable, (b) any fire or other casualty in
the Premises, (c) any damage to or defect in the Premises, including, without
limitation, the fixtures, equipment and appurtenances thereof, the repair of
which Landlord might be responsible for, and/or (d) any damage to or defect in
any part or appurtenance of the Building's sanitary, electrical, heating,
ventilating, air-conditioning, elevator or other systems located in or passing
through the Premises or any part thereof which is the obligation of Landlord
under this Lease to maintain or repair, if and to the extent that Tenant shall
have knowledge of any of the foregoing matters.
ARTICLE 18
Non-Liability and Indemnification
18.01. Neither Landlord, any Superior Lessor or any Superior
Mortgagee, nor any partner, director, officer, shareholder, principal, agent,
servant or employee of Landlord, any Superior Lessor or any Superior Mortgagee
(in any case whether disclosed or undisclosed), shall be liable to Tenant for
any loss, injury or damage to Tenant or to any other person, or to its or their
property, irrespective of the cause of such injury, damage or loss, nor shall
the aforesaid parties be liable for any damage to property of Tenant or of
others entrusted to employees of Landlord nor for loss of or damage to any such
property by theft or otherwise except to the extent caused by or resulting from
the negligence or wilful misconduct of Landlord, its agents, servants, employees
in the operation or maintenance of the Premises or the Real Property. Further,
neither Landlord, any Superior Lessor or any Superior Mortgagee, nor any
partner, director, officer, principal, shareholder, agent, servant or employee
of Landlord, any Superior Lessor or any Superior Mortgagee, shall be liable (a)
to any such damage caused by other tenants or persons in, upon or about the
Building or the Real Property, or caused by operations in construction of any
private, public or quasi-public work; or (b) even if negligent, for
consequential damages arising out of any loss of use of the Premises or any
equipment, facilities or other Tenant's Property therein by Tenant or any person
claiming through or under Tenant.
18.02. Subject to the terms, conditions, restrictions and
limitations elsewhere contained in this Lease, Tenant shall indemnify and hold
harmless Landlord and all Superior Lessors and Superior Mortgagees and its and
their respective partners, directors, officers, principals, shareholders, agents
and employees from and against any and all claims arising from
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or in connection with (a) the conduct of any business at the Premises, or any
work or thing whatsoever done, or any condition created (other than by Landlord,
its partners, directors, principals, shareholders, officers, agents, employees
or contractors) in or about the Premises during the term of this Lease or during
the period of time, if any, prior to the Commencement Date that Tenant may have
been given access to the Premises; (b) any act, omission or negligence of Tenant
or any of its subtenants or licensees or its or their partners, directors,
principals, shareholders, officers, agents, employees or contractors in on or
about the Premises or otherwise in connection with this Lease; (c) any accident,
injury or damage whatever (except to the extent caused by Landlord's negligence
or wilful misconduct or the negligence or wilful misconduct of Landlord's
partners, directors, principals, shareholders, officers, agents, employees or
contractors) occurring in, at or upon the Premises; and (d) any breach or
default by Tenant in the full and prompt payment and performance of Tenant's
obligations under this Lease; together with all reasonable costs, expenses and
liabilities incurred in or in connection with each such claim or action or
proceeding brought thereon, including, without limitation, all reasonable
attorneys' fees and expenses, subject to the provisions of Section 18.03 hereof.
18.03. Wherever in this Lease either party is required to
indemnify the other party in connection with a claim or suit by a third party,
such obligation to indemnify shall be subject to the condition that: (i) the
party seeking indemnification shall notify the indemnifying party of such claim,
and that the indemnified part is seeking indemnification with respect to such
claim, with reasonable promptness after the indemnified party learns of the
claim for which indemnification is being sought, (ii) the indemnified party
shall cooperate with the indemnifying party in connection with the defense of
such claim, (iii) the indemnifying party shall defend such claim (and the
indemnifying party covenants and agrees to defend such claim) on behalf of the
indemnified party using counsel reasonably acceptable to the indemnified party
(counsel selected by the indemnifying party's insurance company being deemed
acceptable for this purpose provided no conflict exists which would preclude
such counsel's representation of the indemnified party), (iv) the indemnifying
party shall have the right to control the defense of such claim, provided,
however, that the indemnifying party shall not settle such claim without the
prior written consent of the indemnified party unless such settlement includes
an unconditional release of all such claims against the indemnified party. From
and after the date the indemnifying party has assumed in writing the defense of
such claim and provided, and for so long as the indemnifying party is continuing
to diligently defend same, the indemnifying party shall not be liable for any
attorneys' fees or expenses incurred by the indemnified party in the defense of
such claim.
18.04. Subject to the terms, conditions, restrictions and
limitations elsewhere contained in this Lease (including, without limitation,
the provisions of Section 35.03 hereof), Landlord shall indemnify Tenant and its
partners, officers, directors, principals, shareholders and employees and save
such parties harmless from and against any and all liability, claims, damages
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(excluding consequential damages), costs or expenses, including reasonable
attorneys' fees, to third parties arising from the negligence or wilful
misconduct of Landlord or its officers, contractors, agents or employees in or
about the Premises or Landlord's breach of this Lease or Landlord's deferral of
its obligation to comply with Legal Requirements pursuant to Section 8.01
hereof. This provision shall not be construed to make Landlord responsible for
loss, damage, liability or expense resulting from injuries to third parties to
the extent caused by the negligence of Tenant or its partners, officers,
directors, principals, shareholders, employees, contractors, licensees, agents,
or invitees or any other matters for which Tenant is liable under this Lease.
ARTICLE 19
Damage or Destruction
19.01. If the Building shall be partially or totally damaged
or destroyed by fire or other casualty (and if this Lease shall not be
terminated as in this Article 19 hereinafter provided), then: (a) Landlord shall
repair the damage to and restore and rebuild the Building (including, without
limitation, the Building Work, but excluding leasehold improvements, Tenant's
improvements and betterments and Tenant's Property) (herein collectively called
"Landlord's Restoration Work") diligently and in a workmanlike manner after
notice to it of the damage or destruction and the collection of the insurance
proceeds attributable to such damage, and (b) Tenant shall repair the damage to
and restore and repair the leasehold improvements, Tenant's improvements and
betterments and Tenant's Property diligently and in a workmanlike manner after
the substantial completion of Landlord's Restoration Work, provided that Tenant
shall not have been notified by Landlord that this Lease has been terminated
pursuant to the provisions of this Article 19, or Tenant shall not have elected
to exercise its right of termination of this Lease pursuant to this Article 19,
and provided further that Tenant may make changes to the leasehold improvements,
Tenant's improvements and betterments and Tenant's Property which existed prior
to such fire or casualty subject to the provisions of this Lease (including,
without limitation, Article 11 to the extent applicable). Such repair work by
Tenant shall be deemed to constitute Alterations for the purposes of Article 11
hereof. Copies of all plans and specifications for such work shall be furnished
to Landlord for its review and approval in accordance with Article 11, but,
provided Tenant previously obtained Landlord's approval if and to the extent
required under Article 11 for the improvements being repaired or replaced by
Tenant, Landlord's right to approve such new plans and specifications shall be
limited to those matters set forth therein which would otherwise require
Landlord's approval under Article 11 hereof and which constitute changes to such
prior improvements. Provided that this Lease shall not be terminated by Landlord
or Tenant, the proceeds of policies providing coverage for leasehold
improvements and Tenant's improvements and betterments shall be paid to Tenant,
to be used by Tenant to repair the damage to and restore and repair the
leasehold improvements,
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Tenant's improvements and betterments and Tenant's Property. If this Lease shall
be terminated by Landlord or Tenant pursuant to this Article 19, the proceeds of
policies providing coverage for leasehold improvements and Tenant's improvements
and betterments shall be paid: (i) to Landlord, in an amount equal to the then
net unamortized or undepreciated portion (determined on a straight-line basis
over the initial term of this Lease with simple interest at the Base Rate or
prime rate referred to in Section 35.05 hereof in effect as of the date of the
fire or casualty in question) of the Work Allowance and (ii) to Tenant, in an
amount equal to the remainder of such proceeds after the payment to Landlord of
the amount described in clause (i) of this sentence. Tenant shall be solely
responsible for (i) the amount of any deductible under the policy insuring the
leasehold improvements and Tenant's improvements and betterments and (ii) the
amount, if any, by which the cost of repairing and restoring the leasehold
improvements and Tenant's improvements and betterments exceeds the available
insurance proceeds therefor.
19.02. If all or part of the Premises shall be damaged or
destroyed or rendered completely or partially untenantable on account of fire or
other casualty, the Fixed Rent and the Additional Charges under Article 3 hereof
shall be abated (x) in the proportion that the untenantable area of the Office
Premises bears to the total area of the Office Premises and (y) in the
proportion that the untenantable area of the Retail Premises bears to the total
area of the Retail Premises, for the period from the date of the damage or
destruction to the date Landlord's Restoration Work shall be substantially
completed by Landlord, provided, however, that if, based upon the estimate of
Landlord's independent contractors, such repairs would have been substantially
completed at an earlier date but for Tenant's having failed to reasonably
cooperate with Landlord in effecting such repair, then Landlord's Restoration
Work shall be deemed to have been repaired substantially on such earlier date
and any reduction or abatement shall cease (and Tenant shall have the right to
dispute such determination by notifying Landlord of such dispute within twenty
(20) days after reviewing notice of such determination, and any such dispute not
resolved between the parties within ten (10) days after such notice of dispute
is given shall be submitted for final resolution by Expedited Arbitration, but
Landlord's contractor's determination shall control pending the resolution of
such dispute); provided, however, should Tenant or any of its subtenants
reoccupy a portion of the Premises for the conduct of business during the period
the repair work is taking place and prior to the date that the Premises are
substantially repaired or made tenantable, the Fixed Rent and the Additional
Charges allocable to such reoccupied portion, based upon the proportion which
(he area of the reoccupied portion of the Premises bears to the total area of
the Premises, shall be payable by Tenant from the date of such occupancy.
19.03. If (i) the Building shall be totally damaged or
destroyed by fire or other casualty, or if the Building shall be so damaged or
destroyed by fire or other casualty that its repair or restoration requires more
than fifteen (15) months or the expenditure of more than fifty (50%) percent of
the full insurable value of the Building immediately prior to the casualty (as
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estimated by a reputable contractor, registered architect or licensed
professional engineer designated by Landlord, which estimate Tenant may dispute
by giving written notice to Landlord of such dispute within twenty (20) days
after Tenant's receipt thereof, with any such dispute not resolved between the
parties within fifteen (15) days after Tenant's notice to be finally resolved by
Expedited Arbitration), Landlord may terminate this Lease by giving Tenant
notice to such effect (herein called "Landlord's Casualty Termination Notice")
as soon as practicable under the circumstances and in any event within one
hundred twenty (120) days after the date of the casualty. For the purpose of
this Section only, "full insurable value" shall mean replacement cost less the
cost of footings, foundations and other structures below the street and the
first floor of the Building.
19.04. (a) In the case of any damage or destruction
mentioned in this Article 19, Tenant may terminate this Lease by notice given to
Landlord in accordance with the last sentence of this Section 19.04(a) if there
has been substantial damage or destruction to the Building and Landlord shall
not have completed Landlord's Restoration Work within fifteen (15) months from
the date of such damage or destruction (herein called the "Restoration
Completion Date"), or within such period after such date (not exceeding ninety
(90) days) as shall equal the aggregate period Landlord may have been delayed in
doing so by reasons of Force Majeure Causes (as defined in Section 35.04
hereof). Except as expressly provided in this Section 19.04, Tenant shall not be
entitled to terminate this Lease and no damages, compensation or claim shall be
payable by Landlord for inconvenience, loss of business or annoyance arising
from the performance of Landlord's Restoration Work pursuant to this Article 19.
Landlord shall use all reasonable efforts to make such repair or restoration
diligently and in a workmanlike manner and in such manner as to not, to the
extent practicable, unreasonably interfere with Tenant's use and occupancy of
the Premises; provided, however, that: (i) Landlord shall not be required to do
such repair or restoration work on an overtime basis except to the extent that
the cost of such overtime work would be covered by Landlord's insurance or (ii)
upon Tenant's written request and agreement to bear the incremental additional
cost of same, Landlord shall perform Landlord's Restoration Work on an overtime
basis. In the event that Tenant becomes entitled to terminate this Lease and the
term and estate hereby granted pursuant to the provisions of the first sentence
of this Section 19.04(a), Tenant may do so by giving a notice to such effect to
Landlord within forty-five (45) days following the date on which Tenant received
Landlord's notice given pursuant to Section 19.04(b), and upon the giving of
such notice this Lease and the term and estate hereby granted shall terminate as
of the date set forth in such notice, which shall not in any event be more than
ninety (90) days after the giving of such notice, with the same force and effect
as if such date were the Expiration Date specified herein.
(b) Within one hundred twenty (120) days after the
occurrence of any such damage or destruction, Landlord shall give Tenant notice
of the date that, in Landlord's good faith judgment, it estimates it shall be
able to substantially complete the required repairs
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and restorations (herein called the "Anticipated Completion Date") subject to
delays for any Force Majeure Causes. If the Anticipated Completion Date shall be
after the Restoration Completion Date, Tenant shall have the right, within
forty-five (45) days after the notice of the Anticipated Completion Date is
given, to terminate this Lease by giving forty five (45) days notice of such
termination to Landlord, and on the date set forth in such notice, which shall
not in any event be more than ninety (90) days after the giving of such notice,
this Lease will terminate as if such date were the Expiration Date specified
herein. If Tenant does not give such termination notice within said 45-day
period, then the Restoration Completion Date provided for herein shall
automatically be deemed extended to the date which is forty-five (45) days
following the Anticipated Completion Date. In no event shall Landlord be liable
to Tenant in the event the restoration is not completed on the Anticipated
Completion Date (as extended for any of the causes described in Section 35.04
hereof) and Tenant's sole remedy shall be the termination right herein provided.
19.05. Landlord and Tenant shall fully cooperate with each
other in connection with the collection of any insurance proceeds payable in
respect of any casualty to the Building and shall comply with all reasonable
requests made by each other in connection therewith, including, without
limitation, the execution of any affidavits required by the applicable insurance
companies.
19.06. Except to the extent expressly set forth in this
Article 19, Tenant shall not be entitled to terminate this Lease and Landlord
shall have no liability to Tenant for inconvenience, loss of business or
annoyance arising from any repair or restoration of any portion of the Premises
or of the Building pursuant to this Article 19.
19.07. Landlord will not carry insurance of any kind on
Tenant's Property or on Tenant's improvements and betterments, or leasehold
improvements and shall not be obligated to repair any damage to or replace any
of the foregoing and Tenant agrees to look solely to its insurance for recovery
of any damage to or loss of any of the foregoing. In the event Tenant fails to
carry any insurance which Tenant is required to maintain under this Lease,
Landlord may notify Tenant of such fact and of Landlord's intention to obtain
such insurance on Tenant's behalf unless Tenant obtains same within four (4)
Business Days after Tenant's receipt of such notice. If Tenant fails to obtain
such insurance within four (4) Business days after receipt of Landlord's notice,
then Landlord may give Tenant a second notice of such fact and of Landlord's
intention to obtain such insurance on Tenant's behalf within two (2) Business
Days after receipt of Landlord's second notice, and if, within two (2) Business
Days after receipt of Landlord's second notice, Tenant has failed to obtain such
insurance, Landlord may (in its sole discretion and without any liability
whatsoever if Landlord elects not to do so) obtain such insurance on Tenant's
behalf, and the cost thereof shall be Additional Charges under this Lease and
payable by Tenant to Landlord within twenty (20) days after demand therefor.
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19.08. The provisions of this Article 19 shall be deemed an
express agreement governing any case of damage or destruction of the Premises by
fire or other casualty, and Section 227 of the Real Property Law of the State of
New York, providing for such a contingency in the absence of an express
agreement; and any other law of like import, now or hereafter in force, shall
have no application in such case.
ARTICLE 20
Eminent Domain
20.01. If the whole of the Building shall be taken by
condemnation or in any other manner for any public or quasi-public use or
purpose, this Lease and the term and estate hereby granted shall terminate as of
the date of vesting of title on such taking (herein called "Date of the
Taking"), and the Fixed Rent and Additional Charges shall be prorated and
adjusted as of such date.
20.02. If more than forty (40%) percent of the Building shall
be so taken, this Lease shall be unaffected by such taking, except that either
Landlord or Tenant may, at Landlord's or Tenant's option, terminate this Lease
by giving the other party notice to that effect within ninety (90) days after
the Date of the Taking. This Lease shall terminate on the date specified in such
notice from Landlord or Tenant to the other, provided that such date shall be
not more than ninety (90) days after the giving of such notice, and the Fixed
Rent and Additional Charges shall be prorated and adjusted as of such
termination date. Upon such partial taking and this Lease continuing in force as
to any part of the Premises, the Fixed Rent shall be reduced: (i) in the
proportion that the area of the Office Premises taken bears to the total area of
the Office Premises and (ii) in the proportion that the area of the Retail
Premises taken bears to the total area of the Retail Premises.
20.03. Landlord shall be entitled to receive the entire award
or payment in connection with any taking without deduction therefrom for any
estate vested in Tenant by this Lease and Tenant shall receive no part of such
award except as hereinafter expressly provided in this Article 20. Tenant hereby
expressly assigns to Landlord all of its right, title and interest in and to
every such award or payment; provided, however, that Tenant shall have the right
to make a separate claim for its moving expenses and to the extent the award
otherwise payable to Landlord shall not be diminished thereby, for any of
Tenant's Property taken.
20.04. If the temporary use or occupancy of all or any part
of the Premises shall be taken by condemnation or in any other manner for any
public or quasi-public use or purpose during the term of this Lease, Tenant
shall be entitled, except as hereinafter set forth, to receive
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that portion of the award or payment for such taking which represents
compensation for the use and occupancy of the Premises, for the taking of
Tenant's Property and for moving expenses, and Landlord shall be entitled to
receive that portion which represents reimbursement for the cost of restoration
of the Premises. This Lease shall be and remain unaffected by such taking and
Tenant shall continue to be responsible for all of its obligations hereunder
insofar as such obligations are not affected by such taking and shall continue
to pay in full the Fixed Rent and Additional Charges when due. If the period of
temporary use or occupancy shall extend beyond the Expiration Date of this
Lease, that part of the award which represents compensation for the use and
occupancy of the Premises (or a part thereof) shall be divided between Landlord
and Tenant so that Tenant shall receive so much thereof as represents the period
up to and including such Expiration Date and Landlord shall receive so much
thereof as represents the period after such Expiration Date. All monies paid as,
or as part of, an award for temporary use and occupancy for a period beyond the
date to which the Fixed Rent and Additional Charges have been paid shall be
received, held and applied by Landlord as a trust fund for payment of the Fixed
Rent and Additional Charges becoming due hereunder, and if Landlord fails to
apply such funds against the Fixed Rent and Additional Charges becoming due
hereunder and such failure continues for twenty (20) days after Tenant has
notified Landlord and any Superior Mortgagee or Superior Lessor whose name and
address shall have previously have been furnished to Tenant of such fact, then
Tenant shall have the right to offset the amount of such funds against the Fixed
Rent and Additional Charges thereafter becoming due hereunder.
20.05. In the event of a taking of less than the whole of the
Building and/or the Land which does not result in termination of this Lease, or
in the event of a taking for a temporary use or occupancy of all or any part of
the Premises which does not result in a termination of this Lease, (a) Landlord,
at its expense, and whether or not any award or awards shall be sufficient for
the purpose, shall proceed with reasonable diligence to repair the remaining
parts of the Building (other than Tenant's Property) to substantially their
former condition to the extent that the same may be feasible (subject to
reasonable changes which Landlord shall deem desirable) and so as to constitute
a complete and rentable Building and (b) Tenant, at its expense, and whether or
not any award or awards shall be sufficient for the purpose, shall proceed with
reasonable diligence to repair Tenant's Property to substantially its former
condition to the extent that the same may be feasible, subject to reasonable
changes which shall be deemed Alterations.
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ARTICLE 21
Surrender
21.01. On the Expiration Date or upon any earlier termination
of this Lease, or upon any lawful reentry by Landlord upon the Premises pursuant
to Article 23 hereof, Tenant shall quit and surrender the Premises to Landlord
"broom-clean" and in good order, condition and repair, except for ordinary wear
and tear and such damage or destruction as Landlord is required to repair or
restore under this Lease and except, if this Lease is terminated by reason of
fire or casualty or condemnation, any damage resulting from such fire or
casualty as Tenant is obligated to repair under this Lease, and Tenant shall
remove all of the Tenant's Property therefrom except as otherwise expressly
provided in this Lease.
21.02. No act or thing done by Landlord or its agents shall be
deemed an acceptance of a surrender of the Premises, and no agreement to accept
such surrender shall be valid unless in writing and signed by Landlord and each
Superior Lessor and Superior Mortgagee whose lease or mortgage, as the case may
be, provides that no such surrender may be accepted without its consent. In no
event, however, shall the consent of, or the giving of any notice by Tenant to,
any Superior Mortgagee or Superior Lessor be required with respect to a
termination of this Lease as a result of a fire or casualty in accordance with
Article 19 hereof or as a result of a condemnation pursuant to Article 20
hereof.
ARTICLE 22
Conditions of Limitation
22.01. This Lease and the term and estate hereby granted are
subject to the limitation that whenever Tenant, or any guarantor of Tenant's
obligations under this Lease, shall make an assignment for the benefit of
creditors, or shall file a voluntary petition under any bankruptcy or insolvency
law, or an involuntary petition alleging an act of bankruptcy or insolvency
shall be filed against Tenant or such guarantor under any bankruptcy or
insolvency law, or whenever a petition shall be filed by or against Tenant or
such guarantor under the reorganization provisions of the United States
Bankruptcy Code or under the provisions of any law of like import, or whenever a
petition shall be filed by Tenant, or such guarantor, under the arrangement
provisions of the United States Bankruptcy Code or under the provisions of any
law of like import, or whenever a permanent receiver of Tenant, or such
guarantor, or of or for the property of Tenant, or such guarantor, shall be
appointed, then Landlord (a) if such event occurs without the acquiescence of
Tenant, or such guarantor, as the case may be, at any time after the event
continues for ninety (90) days, or (b) in any other case at any time after the
occurrence of
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any such event, may give Tenant a notice of intention to end the term of this
Lease at the expiration of five (5) days from the date of service of such notice
of intention, and upon the expiration of said five (5) day period this Lease and
the term and estate hereby granted, whether or not the term shall theretofore
have commenced, shall terminate with the same effect as if that day were the
expiration date of this Lease, but Tenant shall remain liable for damages as
provided in Article 24 hereof. Landlord and Tenant acknowledge that as of the
date of this Lease there is no guarantor of Tenant's obligations hereunder, and
all references to such a guarantor in this Section 22.01 shall be applicable
only in the event there is such a guarantor in the future.
22.02. This Lease and the term and estate hereby granted are
subject to the further limitations that:
(a) if Tenant shall default in the payment of any
Fixed Rent or Additional Charges, and such default shall
continue for ten (10) days after notice thereof has been given
to Tenant (except that, with respect only to the first default
of which notice is given pursuant to this Section 22.02(a) in
any 12-month period, this Section 22.02(a) shall be deemed to
read as follows: "if Tenant shall default in the payment of
any Fixed Rent or Additional Charges, and (x) such default
shall continue for ten (10) days after written notice thereof
has been given to Tenant, (y) Landlord shall have given a
second notice of such default to Tenant after the expiration
of such ten (10) day period, and (z) such default shall have
continued for five (5) day after such second notice has been
given to Tenant"), or
(b) if Tenant shall, whether by action or inaction,
be in default of any of its obligations under this Lease
(other than a default in the payment of Fixed Rent or
Additional Charges) and such default shall continue and not be
remedied as soon as practicable and in any event within thirty
(30) days after Landlord shall have given to Tenant a notice
specifying the same, or, in the case of a default which cannot
with due diligence be cured within a period of thirty (30)
days and the continuance of which for the period required for
cure will not subject Landlord or any Superior Lessor or any
Superior Mortgagee to criminal prosecution or any fine or
other charge (unless such fine or other charge is paid by
Tenant within ten (10) days after demand by Landlord, or if
Tenant is then contesting such fine or other charge the amount
of such fine or other charge or a letter of credit in such
amount in form reasonably satisfactory to Landlord is
deposited with Landlord as security for Tenant's obligation to
pay same if Tenant loses such contest), if Tenant shall not
(x) within said thirty (30) day period advise Landlord of
Tenant's intention to take all steps reasonably necessary to
remedy such default, (y) duly commence within said thirty (30)
day period, and thereafter diligently prosecute to completion
all steps reasonably necessary to remedy the default and
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(z) complete such remedy within a reasonable time after the
date of said notice of Landlord, or
(c) if any event shall occur or any contingency shall
arise whereby this Lease or the estate hereby granted or the
unexpired balance of the term hereof would, by operation of
law or otherwise, devolve upon or pass to any person, firm or
corporation other than Tenant, except as expressly permitted
by Article 7 hereof, and such default is not cured within
twenty (20) days after written notice to Tenant,
then in any of said cases Landlord may give to Tenant a notice of intention to
end the term of this Lease at the expiration of five (5) days from the date of
the service of such notice of intention, and upon the expiration of said five
(5) days this Lease and the term and estate hereby granted, whether or not the
term shall theretofore have commenced, shall terminate with the same effect as
if that day was the day herein definitely fixed for the end and expiration of
this Lease, but Tenant shall remain liable for damages as provided in Article 24
hereof.
ANY NOTICE OF DEFAULT GIVEN TO TENANT PURSUANT TO SECTION 22.02(a)
HEREOF SHALL CONTAIN THE STATEMENT "THIS NOTICE OF DEFAULT IS GIVEN PURSUANT TO
SECTION 22.02(a) HEREOF AND FAILURE TO CURE THE DEFAULT(S) REFERRED TO HEREIN
MAY RESULT IN THE TERMINATION OF YOUR LEASE."
22.03. (a) If Tenant shall have assigned its interest in this
Lease, and this Lease shall thereafter be disaffirmed or rejected in any
proceeding under the United States Bankruptcy Code or under the provisions of
any Federal, state or foreign law of like import, or in the event of termination
of this Lease by reason of any such proceeding, the assignor or any of its
predecessors in interest under this Lease, upon request of Landlord given within
ninety (90) days after such disaffirmance or rejection shall (a) pay to Landlord
all Fixed Rent and Additional Charges then due and payable to Landlord under
this Lease to and including the date of such disaffirmance or rejection and (b)
enter into a new lease as lessee with Landlord of the Premises for a term
commencing on the effective date of such disaffirmance or rejection and ending
on the Expiration Date, unless sooner terminated as in such lease provided, at
the same Fixed Rent and Additional Charges and upon the then executory terms,
covenants and conditions as are contained in this Lease, except that (i) the
rights of the lessee under the new lease, shall be subject to any possessory
rights of the assignee in question under this Lease and any rights of persons
claiming through or under such assignee, (ii) such new lease shall require all
defaults existing under this Lease, other than the bankruptcy or insolvency of
the prior tenant which gave rise to the termination of this Lease, to be cured
by the lessee with reasonable diligence, and (iii) such new lease shall require
the lessee to pay all Additional Charges which, had this Lease not been
disaffirmed or rejected, would have become due after the effective date of such
disaffirmance or rejection With respect to any prior period. If the lessee shall
fail or refuse to
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enter into the new lease within twenty (20) days after Landlord's request to do
so, then in addition to all other rights and remedies by reason of such default,
under this Lease, at law or in equity, Landlord shall have the same rights and
remedies against the lessee as if the lessee had entered into such new lease and
such new lease had thereafter been terminated at the beginning of its term by
reason of the default of the lessee thereunder.
(b) If pursuant to the Bankruptcy Code Tenant is
permitted to assign this Lease in disregard of the restrictions contained in
Article 7 hereof (or if this Lease shall be assumed by a trustee), the trustee
or assignee shall cure any default under this Lease and shall provide adequate
assurance of future performance by the trustee or assignee including (a) of the
source of payment of rent and performance of other obligations under this Lease
(for which adequate assurance shall mean the deposit of cash security with
Landlord in an amount equal to the sum of one year's Fixed Rent then reserved
hereunder plus an amount equal to all Additional Charges payable under Article 3
for the calendar year preceding the year in which such assignment is intended to
become effective, which deposit shall be held by Landlord, in an
interest-bearing account which interest shall accrue as additional security, for
the balance of the term as security for the full and faithful performance of all
of the obligations under this Lease on the part of Tenant yet to be performed)
and that any such assignee of this Lease shall have a net worth exclusive of
good will, computed in accordance with generally accepted accounting principles,
equal to at least ten (10) times the aggregate of the annual Fixed Rent reserved
hereunder plus all Additional Charges for the preceding calendar year as
aforesaid and (b) that the use of the Premises shall in no way diminish the
reputation of the Building as a first-class office building or impose any
additional burden upon the Building or increase the services to be provided by
Landlord. If all defaults are not cured and such adequate assurance is not
provided within 60 days after there has been an order for relief under the
Bankruptcy Code, then this Lease shall be deemed rejected, Tenant or any other
person in possession shall vacate the Premises, and Landlord shall be entitled
to retain any rent or security deposit previously received from Tenant and shall
have no further liability to Tenant or any person claiming through Tenant or any
trustee. If Tenant receives or is to receive any valuable consideration for such
an assignment of this Lease, such consideration, after deducting therefrom (a)
the brokerage commissions, if any, and other expenses reasonably incurred by
Tenant for such assignment and (b) any portion of such consideration reasonably
designed by the assignee as paid for the purchase of Tenant's Property in the
Premises, shall be and become the sole exclusive property of Landlord and shall
be paid over to Landlord directly by such assignee. If Tenant's trustee, Tenant
or Tenant as debtor-in-possession assumes this Lease and proposes to assign the
same (pursuant to Title 11 U.S.C. Section 365, as the same may be amended) to
any person, including, without limitation, any individual, partnership or
corporate entity, who shall have made a bona fide offer to accept an assignment
of this Lease on terms acceptable to the trustee, Tenant or Tenant as
debtor-in-possession, then notice of such proposed assignment, setting forth (x)
the name and address of such person, (y) all of the terms and conditions of such
offer, and (z) the adequate
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assurance to be provided Landlord to assure such person's future performance
under this Lease, including, without limitation, the assurances referred to in
Title 11 U.S.C. Section 365(b)(3) (as the same may be amended), shall be given
to Landlord by the trustee, Tenant or Tenant as debtor-in-possession no later
than twenty (20) days after receipt by the trustee, Tenant or Tenant as
debtor-in-possession of such offer, but in any event no later than ten (10) days
prior to the date that the trustee, Tenant or Tenant as debtor-in-possession
shall make application to a court of competent jurisdiction for authority and
approval to enter into such assignment and assumption, and Landlord shall
thereupon have the prior right and option, to be exercised by notice to the
trustee, Tenant or Tenant as debtor-in-possession, given at any time prior to
the effective date of such proposed assignment, to accept an assignment of this
Lease upon the same terms and conditions and for the same consideration, if any,
as the bona fide offer made by such person, less any brokerage commissions which
may be payable out of the consideration to be paid by such person for the
assignment of this Lease.
ARTICLE 23
Reentry by Landlord
23.01. If Tenant shall default in the payment of any Fixed
Rent or Additional Charges, and such default shall continue for ten (10) days
after written notice thereof has been given to Tenant, or if this Lease shall
terminate as provided in Article 22 hereof, Landlord or Landlord's agents and
employees may immediately or at any time thereafter reenter the Premises, or any
part thereof, either by summary dispossess proceedings or by any suitable action
or proceeding at law, without being liable to indictment, prosecution or damages
therefor, and in connection with such summary dispossess proceedings or other
action or proceeding, as the case may be, may repossess the same, and may remove
any person therefrom, to the end that Landlord may have, hold and enjoy the
Premises. The word "reenter," as used herein, is not restricted to its technical
legal meaning. If this Lease is terminated under the provisions of Article 22,
or if Landlord shall reenter the Premises under the provisions of this Article,
or in the event of the termination of this Lease, or of reentry, by or under any
summary dispossess or other proceeding or action or any provision of law by
reason of default hereunder on the part of Tenant, Tenant shall thereupon pay to
Landlord the Fixed Rent and Additional Charges payable up to the time of such
termination of this Lease, or of such recovery of possession of the Premises by
Landlord, as the case may be, and shall also pay to Landlord damages as provided
in Article 24 hereof.
23.02. In the event of a breach or threatened breach by Tenant
of any of its obligations under this Lease, Landlord shall also have the right
of injunction. The special remedies to which Landlord may resort hereunder are
cumulative and are not intended to be exclusive of any other remedies to which
Landlord may lawfully be entitled at any time and
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Landlord may invoke any remedy allowed at law or in equity as if specific
remedies were not provided for herein.
23.03. If this Lease shall terminate under the provisions of Article 22
hereof, or if Landlord shall reenter the Premises under the provisions of this
Article 23, or in the event of the termination of this Lease, or of reentry, by
or under any summary dispossess or other proceeding or action or any provision
of law by reason of default hereunder on the part of Tenant, Landlord shall be
entitled to retain all monies, if any, paid by Tenant to Landlord, whether as
advance rent, security or otherwise, but such monies shall be credited by
Landlord against any Fixed Rent or Additional Charges due from Tenant at the
time of such termination or reentry or, at Landlord's option, against any
damages payable by Tenant under Article 24 hereof or pursuant to law.
ARTICLE 24
Damages
24.01. If this Lease is terminated under the provisions of Article 22
hereof, or if Landlord shall reenter the Premises under the provisions of
Article 23 hereof, or in the event of the termination of this Lease, or of
reentry, by or under any summary dispossess or other proceeding or action or any
provision of law by reason of default hereunder on the part of Tenant, Tenant
shall pay to Landlord as damages, at the election of Landlord, either:
(a) a sum which at the time of such termination of this Lease
or at the time of any such reentry by Landlord, as the case may be,
represents the then value of the excess, if any (assuming a discount
at a rate per annum equal to 2% per annum in excess of the interest
rate then applicable to Federal Treasury Bonds having a maturity
closest to the Expiration Date), of (i) the aggregate amount of the
Fixed Rent and the Additional Charges under Article 3 hereof which
would have been payable by Tenant (conclusively presuming the average
monthly Additional Charges under Article 3 hereof to be the same as
were payable for the last 12 calendar months, or if less than 12
calendar months have then elapsed since the Commencement Date, all of
the calendar months immediately preceding such termination or reentry)
for the period commencing with such earlier termination of this Lease
or the date of any such reentry, as the case may be, and ending with
the date contemplated as the expiration date hereof if this Lease had
not so terminated or if Landlord had not so reentered the Premises,
over (ii) the aggregate fair market rental value of the Premises for
the same period, or
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(b) sums equal to the Fixed Rent and the Additional Charges
under Article 3 hereof which would have been payable by Tenant had this
Lease not so terminated, or had Landlord not so reentered the Premises,
payable upon the due dates therefor specified herein following such
termination or such reentry and until the date contemplated as the
expiration date hereof if this Lease had not so terminated or if
Landlord had not so reentered the Premises, provided, however, that if
Landlord shall relet the Premises during said period, Landlord shall
credit Tenant, with the net rents received by Landlord from such
reletting, such net rents to be determined by first deducting from the
gross rents as and when received by Landlord from such reletting the
expenses incurred or paid by Landlord in terminating this Lease or in
reentering the Premises and in securing possession thereof, as well as
the expenses of reletting, including, without limitation, altering and
preparing the Premises for new tenants, brokers' commissions,
reasonable legal fees, and all other expenses properly chargeable
against the Premises and the rental therefrom, it being understood that
any such reletting may be for a period shorter or longer than the
remaining term of this Lease; but in no event shall Tenant be entitled
to receive any excess of such net rents over the sums payable by Tenant
to Landlord hereunder, nor shall Tenant be entitled in any suit for the
collection of damages pursuant to this subdivision to a credit in
respect of any net rents from a reletting, except to the extent that
such net rents are actually received by Landlord.
If the Premises or any part thereof be relet by Landlord for the unexpired
portion of the term of this Lease, or any part thereof, before presentation of
proof of such damages to any court, commission or tribunal, the amount of rent
reserved upon such reletting shall, prima facie, be the fair and reasonable
rental value for the Premises, or part thereof, so relet during the term of the
reletting. Landlord shall not be liable in any way whatsoever for its failure or
refusal to relet the Premises or any part thereof, or if the Premises or any
part thereof are relet, for its failure to collect the rent under such
reletting, and no such refusal or failure to relet or failure to collect rent
shall release or affect Tenant's liability for damages or otherwise under this
Lease.
24.02. Suit or suits for the recovery of such damages, or any
installments thereof, may be brought by Landlord from time to time at its
election, and nothing contained herein shall be deemed to require Landlord to
postpone suit until the date when the term of this Lease would have expired if
it had not been so terminated under the provisions of Article 22 hereof, or had
Landlord not reentered the Premises. Nothing herein contained shall be construed
to limit or preclude recovery by Landlord against Tenant, of any sums or damages
to which, in addition to the damages particularly provided above, Landlord may
lawfully be entitled by reason of any default hereunder on the part of Tenant;
provided, however, that Tenant shall not be liable for any consequential
damages. Nothing herein contained shall be construed to limit or prejudice the
107
right of Landlord to prove for and obtain as damages by reason of the
termination of this Lease or reentry on the Premises for the default of Tenant
under this Lease an amount equal to the maximum allowed by any statute or rule
of law in effect at the time when, and governing the proceedings in which, such
damages are to be proved whether or not such amount be greater than any of the
sums referred to in Section 24.01 hereof.
24.03. In addition, if this Lease is terminated under the provisions of
Article 22 hereof, or if Landlord shall, reenter the Premises under the
provisions of Article 23 hereof, Tenant agrees that:
(a) the Premises then shall be in the condition in which Tenant
has agreed to surrender the same to Landlord at the expiration of the term
hereof;
(b) Tenant shall have performed prior to any such termination
any covenant of Tenant contained in this Lease for the making of any Alterations
or for restoring or rebuilding the Premises or any part thereof; and
(c) for the breach of any covenant of Tenant set forth above in
this Section 24.03, Landlord shall be entitled immediately, without notice or
other action by Landlord, to recover, and Tenant shall pay, as and for
liquidated damages therefor, the cost of performing such covenant (as estimated
by an independent contractor selected by Landlord).
24.04. In addition to any other remedies Landlord may have under this
Lease, and without reducing or adversely affecting any of Landlord's rights and
remedies under Article 22, if any Fixed Rent, Additional Charges or damages
payable hereunder by Tenant to Landlord are not paid within seven (7) days after
the due date thereof, the same shall bear interest at the Interest Rate from the
due date thereof until paid, and the amount of such interest shall be an
Additional Charge hereunder. For the purposes of this Section 24.04, a rent xxxx
sent by first class mail, to the address to which notices are to be given under
this Lease, shall be deemed a proper demand for the payment of the amounts set
forth therein.
ARTICLE 25
Affirmative Waivers
25.01. Tenant, on behalf of itself and any and all persons claiming
through or under Tenant, does hereby waive and surrender all right and privilege
which it, they or any of them might have under or by reason of any present or
future law, to redeem the Premises or to
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have a continuance of this Lease after being dispossessed or ejected therefrom
by process of law or under the terms of this Lease or after the termination of
this Lease as provided in this Lease.
25.02. If Tenant is in arrears in payment of Fixed Rent or Additional
Charges, Tenant waives Tenant's right, if any, to designate the items to which
any payments made by Tenant are to be credited, and Tenant agrees that Landlord
may apply any payments made by Tenant to such items as Landlord sees fit,
irrespective of and notwithstanding any designation of request by Tenant as to
the items which any such payments shall be credited.
25.03. Landlord and Tenant hereby waive trial by jury in any action,
proceeding or counterclaim brought by either against the other on any matter
whatsoever arising out of or in any way connected with this Lease, the
relationship of Landlord and Tenant, Tenant's use or occupancy of the Premises,
including, without limitation, any claim of injury or damage, and any emergency
and other statutory remedy with respect thereto.
25.04. Tenant shall not interpose any counterclaim of any kind in any
action or proceeding commenced by Landlord to recover possession of the Premises
(other than compulsory counterclaims).
25.05 Except as otherwise expressly provided in this Lease, Tenant's
exercise of any remedy under this Lease or otherwise shall not preclude the
exercise by Tenant of any other remedy of Tenant under this Lease or otherwise.
ARTICLE 26
No Waivers
26.01. The failure of either party to insist in any one or more
instances upon the strict performance of any one or more of the obligations of
this Lease, or to exercise any election herein contained, shall not be construed
as a waiver or relinquishment for the future of the performance of such one or
more obligations of this Lease or of the right to exercise such election, and
such right to insist upon strict performance shall continue and remain in full
force and effect with respect to any subsequent breach, act or omission. The
payment by Tenant or the receipt by Landlord of Fixed Rent or partial payments
thereof or Additional Charges or partial payments thereof with knowledge of
breach by the other party of any obligation of this Lease shall not be deemed a
waiver of such breach.
26.02. If there be any agreement between Landlord and Tenant providing
for the cancellation of this Lease upon certain provisions or contingencies
and/or an agreement for the
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renewal hereof at the expiration of the term, the right to such renewal or the
execution of a renewal agreement between Landlord and Tenant prior to the
expiration of the term shall not be considered an extension thereof or a vested
right in Tenant to such further term so as to prevent Landlord from canceling
this Lease and any such extension thereof during the remainder of the original
term; such privilege, if and when so exercised by Landlord, shall cancel and
terminate this Lease and any such renewal or extension; any right herein
contained on the part of Landlord to cancel this Lease shall continue during any
extension or renewal hereof; any option on the behalf of Tenant herein contained
for an extension or renewal hereof shall not be deemed to give Tenant any option
for a further extension beyond the renewal or extended term in question (i.e.,
the First Extension Term or the Second Extension Term, as the case may be).
ARTICLE 27
Curing Tenant's Defaults
27.01. If Tenant shall default in the performance of any of Tenant's
obligations under this Lease, Landlord, any Superior Lessor or any Superior
Mortgagee without thereby waiving such default, may (but shall not be obligated
to) perform the same for the account and at the expense of Tenant, without
notice in a case of emergency (provided that Landlord shall endeavor in
emergency circumstances to provide such notice, if any, as is reasonable under
the circumstances), and in any other case only if such default continues after
the giving of notice and the expiration of the applicable grace period, if any.
If Landlord effects such cure by bonding any lien which Tenant is required to
bond, Tenant shall obtain and substitute a bond for Landlord's bond at its sole
cost and expense and reimburse Landlord for the cost of Landlord's bond. Upon
completion of any such cure of Tenant's default pursuant to this Section 27.01,
Landlord shall give notice thereof to Tenant together with a copy of paid
invoices setting forth the reasonable costs and expenses incurred by Landlord in
effecting such cure. Tenant shall reimburse Landlord, as Additional Charges
hereunder, within ten (10) days after receipt of such notice for such reasonable
costs and expenses incurred by Landlord in effecting such cure. In the case of
any default by Tenant under this Lease if Landlord shall elect to cure such
default (without any obligation on the part of Landlord to commence or complete
any such cure) and Tenant shall reimburse Landlord for the reasonable costs and
expenses incurred by Landlord in effecting such cure as herein above provided in
this Section 27.01, then, unless this Lease has been terminated pursuant to
Article 22 hereof or by operation of law or otherwise prior to such cure by
Landlord and reimbursement by Tenant, upon such cure by Landlord and
reimbursement by Tenant such default shall be deemed cured by Tenant, provided
however that the foregoing shall not be deemed to preclude Landlord from
terminating this Lease pursuant to Article 22 or
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otherwise exercising its rights and remedies against Tenant under this Lease or
at law or in equity or otherwise prior to the completion of such cure by
Landlord and reimbursement by Tenant.
27.02. Bills for any expenses incurred by Landlord or any Superior
Lessor or any Superior Mortgagee in connection with any such performance by it
for the account of Tenant, and bills for all costs, expenses and disbursements
of every kind and nature whatsoever, including, without limitation, reasonable
counsel fees, involved in collecting the Fixed Rent or Additional Charges or any
part thereof (including, without limitation, all such costs, expenses and
disbursements incurred in endeavoring to collect such items if Tenant is
ultimately determined to have been in default of the payment of any such sums)
or enforcing any rights against Tenant or Tenant's obligations hereunder, under
or in connection with this Lease or pursuant to law (including, without
limitation, all such costs, expenses and disbursements incurred in endeavoring
to enforce such rights or obligations if Tenant is ultimately determined to be
in default under this Lease), including, without limitation, any such cost,
expense and disbursement involved in instituting and prosecuting summary
proceedings or in recovering possession of the Premises after default by Tenant
or upon the expiration or sooner termination of this Lease, and interest on all
sums advanced by Landlord or such Superior Lessor or Superior Mortgagee under
this Section 27.02 and/or Section 27.01 (at the Interest Rate or the maximum
rate permitted by law, whichever is less) may be sent by Landlord or such
Superior Lessor or Superior Mortgagee to Tenant monthly, or immediately, at its
option, and such amounts shall be due and payable as Additional Charges in
accordance with the terms of such bills.
27.03. With respect to any legal proceedings or actions which shall be
commenced by either Landlord or Tenant as a result of a breach by the other
party of its covenants under this Lease, the party which shall prevail in any
such proceeding or action shall be entitled to collect from the non-prevailing
party, reasonable attorneys' fees and disbursements incurred by the prevailing
party in any such action or proceeding.
ARTICLE 28
Broker
28.01. Tenant covenants, warrants and represents that no broker except
Xxxxxx X. Xxxxxxx, Inc. and Xxxxxxxx Real Estate Co., Inc. (herein collectively
called the "Broker") was instrumental in bringing about or consummating this
Lease and that Tenant had no conversations or negotiations with any broker
except the Broker concerning the leasing of the Premises. Tenant agrees to
indemnify and hold harmless Landlord 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
expenses (subject to the provisions of Section 18.03
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hereof), arising out of any conversations or negotiations had by Tenant with any
broker other than the Broker. Landlord agrees to indemnify and hold harmless
Tenant 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 expenses (subject to the provisions of Section
18.03 hereof), arising out of (i) Landlord's failure to pay the Broker a
commission in connection with this Lease, or (ii) conversations or negotiations
had by Landlord with any broker purporting to have dealt with Tenant and with
whom Tenant shall have had no dealings.
ARTICLE 29
Notices
29.01. Any notice, statement, demand, consent, approval or other
communication required or permitted to be given, rendered or made by either
party to this Lease or pursuant to any applicable law or requirement of public
authority (collectively, "notices") shall be in writing (whether or not so
stated elsewhere in this Lease) and shall be deemed to have been properly given,
rendered or made only if sent by registered or certified mail, return receipt
requested, posted in a United States post office station or letter box in the
continental United States, or by nationally recognized overnight courier service
(e.g., Federal Express) for delivery the next business day, in either case,
addressed to the other party as follows:
If to Landlord:
Massachusetts Mutual Life Insurance Company
c/o Cornerstone Real Estate Advisers, Inc.
Xxx Xxxxxxxxx Xxxxx, Xxxxx 0000
Xxxxxxxx, Xxxxxxxxxxx 00000-0000
Attn: Northeast Managing Director
with a copy to:
Massachusetts Mutual Life Insurance Company
c/o Cornerstone Real Estate Advisers, Inc.
Xxx Xxxxxxxxx Xxxxx, Xxxxx 0000
Xxxxxxxx, Xxxxxxxxxxx 00000-0000
Attn: Northeast Regional Counsel
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with a copy to:
Massachusetts Mutual Life Insurance Company
c/o Cornerstone Real Estate Advisers, Inc.
Xxx Xxxxxxxxx Xxxxx, Xxxxx 0000
Xxxxxxxx, Xxxxxxxxxxx 00000-0000
Attn: Northeast Asset Manager
with a copy to:
Xxxxxxx Berlin Shereff Xxxxxxxx, LLP
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: Xxxxxx X. Xxxxxxx, Esq.
and if to Tenant as follows:
SFX Real Estate Group
000 X. Xxxxxxx Xxxxx
Xxxxx 000
Xxxxxx, Xxxxxxxx 00000
Attention: Xxxxxxx Xxxxx
Telecopier No.: 630-566-6166(2)
with a copy to:
SFX Entertainment, Inc.
000 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Chief Financial Officer
Telecopier No.: 212-486-4840(2)
----------
(2) Telecopier numbers provided for purposes of Section 29.04 hereof only.
113
with a copy to:
SFX Entertainment, Inc.
000 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: General Counsel
Telecopier No.: 212-486-4830(3)
with a copy to:
Rosenman & Colin LLP
000 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxxxx X. Xxxxxxxxx, Esq.
Telecopier No.: 212-940-8776(3)
and shall be deemed to have been given, rendered or made: (i) if sent by
registered or certified mail as aforesaid, then on the third business day
following the day so mailed, and (ii) if sent by nationally recognized overnight
courier service as aforesaid, then on the next business day after being so sent.
Either party may, by notice as aforesaid, designate a different address or
addresses for notices intended for it. Notwithstanding the foregoing, with
respect to an occurrence presenting imminent danger to the health or safety of
persons or damage to property in, on or about the Building or during a postal
strike, notices may be hand delivered to a party at the address to which notices
to that party are to be sent, provided that the same notice is also sent in the
manner set forth above.
29.02. Notices hereunder from Landlord may be given by the Manager, if
one exists, or by Landlord's attorney, and notices hereunder from Tenant may be
given by Tenant's attorney, in each ease with the same force and effect as if
given by the respective party.
29.03. In addition to the foregoing, either Landlord or Tenant may,
from time to time, request in writing that the other party serve a copy of any
notice on one other person or entity designated in such request, such service to
be effected as provided in Section 29.01 or 29.02 hereof.
29.04. At Landlord's option, the Substantial Completion Notice to be
given pursuant to Section 1.05(b) hereof may be given by telecopier and, in such
event, shall be
----------
(3) Telecopier numbers provided for purposes of Section 29.04 hereof only.
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deemed given on the date telecopied to Tenant and the parties entitled to
receive copies of notices to Tenant pursuant to Section 29.01 above at the
telecopy numbers set forth in Section 29.01, provided a copy of such Substantial
Completion Notice is sent to such parties, on the date such telecopied notice is
given, by nationally recognized overnight courier service (e.g., Federal
Express) for delivery the next business day.
ARTICLE 30
Estoppel Certificates
30.01 Each party agrees, at any time and from time to time, as
requested by the other party with not less than fifteen (15) days' prior notice,
to execute and deliver to the other a statement certifying that this Lease is
unmodified and in full force and effect (or if there have been modifications,
that the same is in full force and effect as modified and stating the
modifications), certifying the dates to which the Fixed Rent and Additional
Charges have been paid, stating whether or not, to the best knowledge of the
signer, the other party is in default in performance of any of its obligations
under this Lease, and if so, specifying each such default of which the signer
shall have knowledge, and stating whether or not, to the best knowledge of the
signer, any event has occurred which with the giving of notice or passage of
time, or both, would constitute such a default, and, if so, specifying each such
event, it being intended that any such statement delivered pursuant hereto shall
be deemed a representation and warranty to be relied upon by the party
requesting the certificate and by others with whom such party may be dealing,
regardless of independent investigation. Tenant also shall include in any such
statement such other information concerning this Lease as Landlord may
reasonably request.
30.02. Any request by Tenant to Landlord for a statement pursuant to
Section 30.01 shall also constitute a Reminder Notice pursuant to Section 3.05
of this Lease (i.e., if Landlord fails to render a final Operating Statement or
Tax xxxx concurrently with the delivery to Tenant of Landlord's statement
pursuant to Section 30.01 as to any Tax Year or Operating Year whose Outside
Billing Date occurred prior to the date of Tenant's request for such statement,
then Landlord shall be deemed to have waived the payment of any then unpaid
Additional Charges which would have been due pursuant to said Operating
Statement or xxxx for Taxes, or which would have been due pursuant to any
amended Operating Statement or xxxx for Taxes, for such Operating Year or Tax
Year, as the case may be).
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ARTICLE 31
Memorandum of Lease
31.01. Tenant shall not record this Lease. Concurrently with the
execution of this Lease, the parties have executed, acknowledged and delivered,
and the parties shall record, a statutory form of memorandum of this Lease
pursuant to the provisions of Section 291-C of the Real Property Law of the
State of New York in the form annexed hereto as EXHIBIT O.
ARTICLE 32
No Representations by Landlord
32.01. Tenant expressly acknowledges and agrees that Landlord has not
made and is not making, and Tenant, in executing and delivering this Lease, is
not relying upon, any warranties, representations, promises or statements,
except to the extent that the same are expressly set forth in this Lease or in
any other written agreement which may be made between the parties concurrently
with the execution and delivery of this Lease and shall expressly refer to this
Lease. All understandings and agreements heretofore had between the parties are
merged in this Lease and any other written agreement(s) made concurrently
herewith, which alone fully and completely express the agreement of the `parties
and which are entered into after full investigation, neither party relying upon
any statement or representation not embodied in this Lease or any other written
agreement(s) made concurrently herewith.
ARTICLE 33
Roof Rights
33.01. Landlord agrees that, subject to all laws, ordinances, statutes,
rules and regulations of all governmental authorities having jurisdiction
thereof, and if and to the extent that Landlord's entitlement to the tax credits
described in Article 41 hereof for which Landlord has applied as of the date of
this Lease,(herein called the "Historic Tax Credits") would not be reduced or
otherwise adversely affected thereby (subject, however, to the provisions of
Section 41.02 hereof), and further subject to the terms, conditions and
limitations as are hereinafter set forth, during the term of this Lease, Tenant,
at Tenant's sole cost and expense, may install on the rooftop (including,
without limitation, any setbacks) of the Building (herein called the "Antenna
Areas") and thereafter maintain, repair and operate one or more communications
apparatus (herein called the "Antennas"), provided and on condition that:
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(i) the required support structures and the method of
attaching same to the Building, as well as any penetrations of the roof
or facade of the Building required in connection with the installation
of any Antennas, related equipment or Wiring (as such term is defined
in this Section 33.01), shall be subject to Landlord's prior consent,
such consent not to be unreasonably Withheld or delayed. Copies of
plans and specifications for all Antennas, related equipment and Wiring
shall be delivered to Landlord prior to commencement of installation
thereof;
(ii) the installation and position of such Antennas and
reasonably required support structures shall comply with Legal
Requirements;
(iii) the installation of any electrical or communications
lines (herein called "Wiring") and related equipment in connection with
the installation and operation of the Antennas, as well as the manner
and location (i.e., routing) of all Wiring and related equipment in
connection therewith shall (a) be at Tenant's sole cost and expense,
and (b) comply with Legal Requirements; and
(iv) the Antennas, reasonably required support structures,
Wiring and related equipment shall be maintained and kept in repair by
Tenant, at Tenant's sole cost and expense.
33.02. For the purpose of installing, servicing or repairing the
Antennas and related equipment, Tenant shall have access to the rooftop of the
Building. All access by Tenant to the roof of the Building shall be subject to
Landlord's reasonable safeguards for the security and protection of the Building
and such Building equipment and installations as maybe located on the roof of
the Building. Landlord shall have the right to assign a representative of
Landlord or the Manager to be present during the duration of Tenant's access to
the rooftop and Tenant shall pay any charge therefor under the Management
Agreement in accordance with Article 15 hereof.
33.03. Tenant, at Tenant's sole cost and expense, agrees to promptly
and faithfully obey, observe and comply with all laws, ordinances, regulations,
requirements and rules of all duly constituted public authorities in any manner
affecting or relating to Tenant's use of said roof as to the installation,
repair, maintenance and operation of any support structures, Antennas and
related equipment erected or installed by Tenant pursuant to the provisions of
this Article 33. Tenant, at Tenant's sole cost and expense, shall secure and
thereafter maintain all permits and licenses required for the installation and
operation of the Antennas and any support structures and related equipment
erected or installed by Tenant pursuant to the provisions of this Article 33.
including, without limitation, any approval, license or permit required from the
Federal Communications Commission. In no event shall the maximum level of
microwave
117
emissions from the Antennas exceed the amount allowable for the Building as
determined by the governmental authorities having jurisdiction thereof.
33.04. The Antennas, support structures and related equipment installed
by Tenant pursuant to the provisions of this Article 33 shall be Tenant's
personal property, and, upon the Expiration Date, or earlier termination of this
Lease, shall be removed by Tenant at Tenant's sole cost and expense. All wiring
and related electrical equipment installed by Tenant in connection with the
installation and operation of the Antennas shall be Tenant's personal property.
Upon the Expiration Date, or earlier termination of this Lease, if Landlord so
directs by written notice to Tenant, Tenant shall promptly remove the electrical
equipment (other than the Wiring, which need not be removed) as designated in
such notice, at Tenant's sole cost and expense. Tenant, at Tenant's sole cost
and expense, shall promptly repair any and all damage to the rooftop of the
Building and to any other part of the Building caused by or resulting from the
installation, maintenance and repair, operation or removal of the Antennas,
support structures, Wiring and related equipment erected or installed by Tenant
pursuant to the provisions of this Article 33 and restore said affected areas to
their condition as existed prior to the installation of the Antennas and related
equipment, subject to normal wear and tear and damage for which Tenant is not
responsible hereunder. Notwithstanding anything to the contrary contained in the
preceding sentence, in the event Tenant fails to perform such repair work after
notice and expiration of the applicable cure period, Landlord shall have the
option of performing any such repairs, at Tenant's sole cost and expense, to the
extent that same are reasonable, which cost and expense shall be payable by
Tenant to Landlord as an Additional Charge hereunder within thirty (30) days
after Tenant shall have been billed therefor.
33.05. Tenant covenants and agrees that all installations made by
Tenant on the rooftop of the Building or in any other part of the Building
pursuant to the provisions of this Article 33 shall be at the sole risk of
Tenant, and neither Landlord nor Landlord's agent or employees shall be liable
for any damage or injury thereto caused in any manner, except to the extent
caused by the negligence or willful misconduct of Landlord, its agents or
employees.
33.06. Tenant will, and does hereby agree to, indemnify, defend and
save harmless Landlord from and against: (i) any and all claims, reasonable
counsel fees (subject to the provisions of Section 18.03 hereof), demands,
damages, expenses or losses by reason of any liens, orders, claims or charges
resulting from any work done, or materials or supplies furnished, in connection
with the fabrication, erection, installation, maintenance and operation of the
Antennas, support structures, Wiring and any related equipment installed by
Tenant pursuant to the provisions of this Article 33; and (ii) any and all
claims, costs, demands, expenses, fees or suits arising out of accidents,
damage, injury or loss to any and all persons and property, or either,
whomsoever or whatsoever resulting from or arising in connection with the
erection, installation. maintenance and operation and repair of the Antennas,
support structures, Wiring
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and related equipment installed by Tenant pursuant to the provisions of this
Article 33; except to the extent caused by the negligence or willful misconduct
of Landlord, its agents or employees. If any installations referred to in this
Article 33 should revoke, negate or in any manner impair or limit any roof
warranty or guaranty obtained by Landlord, then Landlord shall use reasonable
efforts to give Tenant prior notice of the same (and, to the extent possible,
shall endeavor to do so at the plan approval stage) and Landlord shall, in any
event deliver a copy of such roof warranty or guaranty to Tenant promptly after
Tenant's written request. therefor, and Tenant shall reimburse Landlord for any
loss or damage sustained or reasonable costs or expenses incurred by Landlord as
a result thereof.
33.07. All plans and specifications of Tenant's work and installations
to be done and made by Tenant pursuant to the provisions of this Article 33
shall be subject to the prior approval of Landlord, such approval not to be
unreasonably withheld or delayed, and shall be further subject to inspection and
reasonable supervision by Landlord, agreeing that it shall not be deemed to
incur any liability by reason of the provisions of this Section 33.07.
33.08. Tenant covenants and agrees that the Antennas, support
structures, Wiring and related electrical equipment to be installed by Tenant
shall not interfere with or adversely affect any equipment, installations, lines
or machinery of the Building.
33.09. Tenant shall have the right, upon prior notice to Landlord to
sublet or license to third parties the roof or portions thereof for the purposes
permitted under this Article 33 provided and on condition that any such sublease
or license shall comply with the provisions of Section 7.09 hereof (other than
subsection (d) thereof). Landlord shall not be obligated to enter into any
non-disturbance agreement with respect to any such sublease or license covering
the any portion of the-roof, and any such sublease or license shall provide that
it is subject and subordinate to this Lease and to any matters to which this
Lease is or shall be subordinate, as more particularly provided in Section 7.09
hereof. Except as provided in this Section 33.09, Tenant shall not be permitted
to assign or transfer all or any portion of the rights granted to Tenant
pursuant to this Article 33 unless Tenant assigns this Lease or subleases all or
substantially all the Premises to the party to whom such rights are assigned or
transferred -pursuant to Article 7 hereof; or unless Tenant subleases
substantially all of the Premises pursuant to Article 7 hereof, in which case
such subtenant shall have the rights of Tenant hereunder for so long as such
sublease shall be in full force and effect.
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ARTICLE 34
Holdover
34.01. (a) In the event this Lease is not renewed or extended or a new
lease is not entered into between the parties, and if Tenant shall then hold
over after the expiration of the term of this Lease, and if Landlord shall then
not proceed to remove Tenant from the Premises in the manner permitted by law
(or shall not have given written notice to Tenant that Tenant must vacate the
Premises) irrespective of whether or not Landlord accepts rent from Tenant for a
period beyond the Expiration Date, the parties hereby agree that Tenant's
occupancy of the Premises after the expiration of the term shall be under a
month-to-month tenancy commencing on the first day after the expiration of the
term, which tenancy shall be upon all of the terms set forth in this Lease
except Tenant shall pay on the first day of each month of the holdover period as
Fixed Rent, an amount equal to the higher of (i) an amount equal to the Holdover
Percentage [as such term is defined in this Section 34.01(a)] of one-twelfth of
the Fixed Rent payable by Tenant during the last year of the term of this Lease
(i.e., the year immediately prior to the holdover period) or (ii) an amount
equal to the then market rental value for the Premises as shall be established
by Landlord giving notice to Tenant of Landlord's good faith estimate of such
market rental value. Tenant may dispute such market rental value for the
Premises as estimated by Landlord by giving notice to Landlord within but in no
event after twenty (20) days after the giving of Landlord's notice to Tenant (as
to the giving of which notice to Landlord, time shall be deemed of the essence).
Enclosed with such notice, Tenant shall be required to furnish to Landlord the
written opinion of a reputable New York licensed real estate broker having
leasing experience in the Borough of Manhattan, for a period of not less than
ten (10) years setting forth said broker's good faith opinion of the market
rental value of the Premises. If Tenant and Landlord are unable to resolve any
such dispute as to the market rental value for the Premises then an independent
arbitrator who shall be a real estate broker of similar qualifications and shall
be selected from a listing of not less than three (3) brokers furnished by the
American Arbitration Association (or any successor thereto) to Tenant and
Landlord (at the request of either Landlord or Tenant). If Landlord and Tenant
are unable to agree upon the selection of the individual arbitrator from such
listing; then the first arbitrator so listed by the American Arbitration
Association (or any successor thereto) shall be conclusively presumed to have
been selected by both Landlord and Tenant and the decision of such arbitrator
shall be conclusive and binding upon the parties as to the market rental value
for the Premises. Pending the determination of the market rental value of the
Premises upon the expiration of the term of this Lease, Tenant shall pay to
Landlord as Fixed Rent an amount computed in accordance with clauses (i) or (ii)
of this subsection 34.01(a) (as Landlord shall then elect), and upon
determination of the market rental value of the Premises in accordance with the
preceding provisions hereof appropriate adjustments and payments shall be
effected. If as a result of such adjustments Landlord is required to reimburse
same to Tenant, Landlord shall reimburse Tenant for same with interest at
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the Interest Rate from the date(s) paid by Tenant to the date
reimbursed to Tenant, and if Landlord fails to so reimburse Tenant
within ten (10) days after such determination is made, Tenant may
notify Landlord of such fact and of Tenant's intention to offset such
amounts against amounts thereafter payable by Tenant under this Lease,
a copy of which notice shall be delivered simultaneously to any
Superior Lessor or Superior Mortgagee whose name and address shall have
previously have been furnished to Tenant. If such failure continues for
a further period of ten (10) days following the giving of such notice,
Tenant may offset the amount due Tenant against the next payment(s) due
under this Section 34.01 or any other charges payable under this Lease,
together with interest at the Interest Rate from the date(s) originally
paid by Tenant until the date(s) offset by Tenant. Landlord shall not
be required to perform any work, furnish any materials or make any
repairs within the Premises during the holdover period, except to the
extent same are required to furnish services required to be performed
by Landlord under this Lease, provided, however, that Landlord shall
not be obligated to provide services, other than during ordinary
business hours (i.e., 8:00 AM to 6:00 PM) of Business Days, unless
Tenant pays the incremental cost to Landlord of providing such services
during any such additional hours in advance of the provision of such
services, provided Landlord has furnished Tenant with an invoice
setting forth such incremental charges so that Tenant has a reasonable
opportunity to pay same in advance, it being understood that overtime
services being requested on the same day as same are to be provided may
be invoiced and, if invoiced, shall be paid, on such day). It is
further stipulated and agreed that if Landlord shall, at any time after
the expiration of the original term or after the expiration of any term
created thereafter, proceed to remove Tenant from the Premises as a
holdover, the Fixed Rent for the use and occupancy of the Premises
during any holdover period shall be calculated in the same manner as
set forth above. In addition to such Fixed Rent, Tenant shall continue
to pay Additional Charges during such holdover period in accordance
with all of the terms and provisions of this Lease, including, without
limitation, Additional Charges pursuant to Article 3 hereof. As used
herein, the term "Holdover Percentage" shall mean, (i) for the first
sixty (60) days of any such holdover period, one hundred fifty (150%)
percent, and (ii) for the remainder of any such holdover period,
two-hundred (200%) percent.
(b) Notwithstanding anything to the contrary contained
in this Lease, the acceptance of any rent paid by Tenant pursuant to
subsection 34.01(a) above shall not preclude Landlord from commencing
and prosecuting a holdover or summary eviction proceeding. The
preceding sentence shall be deemed to be an "agreement expressly
providing otherwise" within the meaning of Section 232-c of the Real
Property Law of the State of New York.
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ARTICLE 35
Miscellaneous Provisions and Definitions
35.01. No agreement shall be effective to change, modify,
waive, release, discharge, terminate or effect an abandonment of this
Lease, in whole or in part, including, without limitation, this Section
35.01, unless such agreement is in writing, refers expressly to this
Lease and is signed by the party against whom enforcement of the
change, modification, waiver, release, discharge, termination or
effectuation of the abandonment is sought.
35.02. Except as otherwise expressly provided in this Lease,
the obligations of this Lease shall bind and benefit the successors and
assigns of the parties hereto with the same effect as if mentioned in
each instance where a party is named or referred to; provided, however,
that (a) no violation of the provisions of Article 7 shall operate to
vest any rights in any successor or assignee of Tenant and (b) the
provisions of this Article 35 shall not be construed as modifying the
conditions of limitation contained in Section 22.02(c).
35.03. Tenant shall look only to (i) Landlord's estate and
property in the Land and the Building, (ii) any insurance proceeds and
condemnation awards to the extent not applied to the repair and
restoration of the Real Property, subject, however, to the rights of
any Superior Lessor or Superior Mortgagee, (iii) the proceeds of a sale
of the Real Property, provided that Tenant shall have given Landlord
notice of any claim against such proceeds within ten (10) Business Days
after Tenant's receipt of notice of such sale, which may include a
request for delivery of an estoppel statement in connection with a
pending sale of the Real Property, for the satisfaction of Tenant's
remedies, for the collection of a judgment (or other judicial process)
requiring the payment of money by Landlord in the event of any default
by Landlord hereunder, and no other property or assets of Landlord or
its partners, officers, directors, shareholders or principals,
disclosed or undisclosed, shall be subject to levy, execution or other
enforcement procedure for the satisfaction of Tenant's remedies under
or with respect to this Lease, the relationship of Landlord and Tenant
hereunder or Tenant's use or occupancy of the Premises.
35.04. (a) Except as expressly provided in Articles 19 and 20
hereof, the obligations of Tenant hereunder shall be in no wise
affected, impaired or excused, nor shall Landlord have any liability
whatsoever to Tenant, nor shall it be deemed a constructive eviction
because (a) Landlord is unable to fulfill, or is delayed in fulfilling,
any of its obligations under this Lease by reason of strike, lock-out
or other labor trouble, governmental preemption of priorities or other
controls in connection with a national or other public emergency or
shortages of fuel, supplies or labor resulting therefrom, or any other
cause, whether similar or dissimilar, beyond Landlord's reasonable
control; or (b) of any failure or defect in the supply, quantity or
character of electricity or water furnished to the Premises, by reason
of any requirement, act or
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omission of the public utility or others serving the Building with
electric energy, steam, oil, gas or water, or for any other reason
whether similar or dissimilar, beyond Landlord's reasonable control
(the foregoing circumstances described in this Section 35.04(a) being
herein called "Force Majeure Causes").
(b) Notwithstanding anything to the contrary contained
in this Lease, if for a period of twenty (20) consecutive days (or any
thirty (30) days in any consecutive forty (40) day period) (i) as a
result of causes other than any act or omission of Tenant or any
subtenant or occupant of the Premises claiming under or through Tenant,
or their respective agents, employees, visitors or licensees, there is
a failure of services required to be provided to the Premises or
Landlord shall fail to make the repairs required to be made hereunder
by Landlord or Landlord shall fail to comply with any Legal Requirement
which is the obligation of Landlord to comply with under the terms of
this Lease (each of the foregoing failures being herein called a
"Failure"), and (ii) as a result of such Failure, the Premises or any
one or more full floors of the Premises shall be rendered untenantable
for the normal conduct of business (or, in the case of the Failure by
Landlord to comply with any Legal Requirement which is the obligation
of Landlord to comply with under the terms of this Lease, such Failure
results in the issuance of an order by a governmental authority to
vacate the Premises or any one or more full floors of the Premises),
and (iii) Tenant shall vacate the Premises or such floor or floors
thereof, and (iv) Tenant shall have given notice to Landlord, and to
any Superior Mortgagee or Superior Lessor whose name and address shall
have previously have been furnished to Tenant, that the Premises or
such full floor or floors thereof have been rendered untenantable (or
ordered vacated as set forth above) by reason of such Failure, then in
such event the Fixed Rent and Additional Charges payable by Tenant
pursuant to Article 3 hereof (or such portion thereof as is allocable
to the floor or floors thereof in question, such allocation to be made
in accordance with Exhibit D annexed hereto), shall be abated for the
period commencing on the day that all of the requirements set forth in
clauses (i), (ii), (iii) and (iv) (herein collectively called the
"Untenantability Conditions") are first met and ending on the date that
the Premises or such full floor or floors thereof shall be rendered
tenantable for the conduct of Tenant's business or such earlier date as
Tenant or anyone acting under or through Tenant shall have resumed
occupancy of the Premises or such floor or floors thereof The
requirement that Tenant vacate all or a portion of the Premises as a
condition to obtaining a rent abatement under this subsection 35.04(b)
shall not be deemed to require Tenant to remove Tenant's Property from
the Premises and shall not be deemed to preclude Tenant from having a
skeleton staff in the Premises for the purpose of answering telephones,
providing security and/or retrieving files or other personal property.
(c) In the event that all of the Untenantability
Conditions exist for a period of fifteen (15) consecutive months
(herein called the "Untenantability Termination Period"), and affect a
substantial portion of the Premises (i.e., at least 30% of the floor
areas of the Building have been rendered untenantable or have been
ordered vacated as set forth above), then Tenant
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may terminate this Lease by written notice given to Landlord and any
Superior Mortgagee or Superior Lessor whose name and address shall have
previously have been furnished to Tenant not later than twenty (20)
days after the end of the Untenantability Termination Period, and such
termination shall be effective on the thirtieth (30th) day following
the giving of such notice unless the Premises or applicable portion
thereof are rendered tenantable prior to the end of such 30-day period.
In addition, at any time following the occurrence and during the
continuance of all of the Untenantability Conditions which affect a
substantial portion of the Premises (i.e., at least 30% of the floor
areas of the Building), Tenant may send a notice to Landlord (herein
called an "Untenantability Termination Notice") that Tenant believes
that the repairs, improvements, alterations or other work required to
remedy the Failure in question (herein called the "Remedy Work") cannot
reasonably be completed prior to the end of the Untenantability
Termination Period (which Untenantability Termination Notice shall be
accompanied by a letter from a licensed professional engineer having at
least 15 years experience in the principal areas involved in the Remedy
Work stating that, in his professional opinion, the Remedy Work cannot
reasonably be completed prior to the end of the Untenantability
Termination Period) and setting forth Tenant's intention to terminate
the Lease and further stating that Landlord has a period of thirty (30)
days following the giving of such Untenantability Termination Notice to
dispute Tenant's claim that the Remedy Work cannot reasonably be
completed prior to the end of the Untenantability Termination Period, a
copy of which Untenantability Termination Notice shall be delivered
simultaneously to any Superior Lessor or Superior Mortgagee whose name
and address shall have previously have been furnished to Tenant. In the
event Tenant gives an Untenantability Termination Notice, then this
Lease shall terminate on the sixtieth (60th) day following the giving
of the Untenantability Termination Notice unless either (i) the
Premises or applicable portion thereof are rendered tenantable prior to
the end of such 60-day period, or (ii) within thirty (30) days
following the giving of such Untenantability Termination Notice,
Landlord notifies Tenant that Landlord disputes Tenant's claim that the
Remedy Work cannot reasonably be completed prior to the end of the
Untenantability Termination Period. In the event Landlord so notifies
Tenant of such dispute and same cannot be resolved by the parties
within ten (10) days thereafter, such dispute shall be finally resolved
by Expedited Arbitration. If the final determination of such dispute is
that the Remedy Work cannot reasonably be completed prior to the end of
the Untenantability Termination Period, then this Lease shall terminate
on the 30th day following the date such final determination is
rendered. Except as provided in this Section 35.04(c), Tenant shall
not be obligated to provide additional notices or additional cure
periods to any Superior Mortgagor or Superior Lessor as a condition of
the exercise of Tenant's right to terminate this Lease under this
Section 35.04(c).
35.05. For the purposes of this Lease, the following terms
have the meanings indicated:
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(a) The term "mortgage" shall include a mortgage and/or
a deed of trust, and the term "holder of a mortgage" or "mortgagee" or
words of similar import shall include a mortgagee of a mortgage or a
beneficiary of a deed of trust.
(b) The term "Legal Requirements" and words of a
similar import shall mean laws and ordinances of any or all of the
federal, state, city, town, county, and borough governments including,
without limitation, The Americans with Disabilities Act of 1990, as
amended, and rules, regulations, orders and directives of any and all
departments, subdivisions, bureaus, agencies or offices thereof, and of
any other governmental, public or quasi-public authorities having
jurisdiction over the Building and/or the Premises, and the direction
of any public officer pursuant to law, whether now or hereafter in
force.
(c) The term "requirements of insurance bodies" and
words of similar import shall mean rules, regulations, orders and other
requirements of the New York Board of Underwriters and/or the New York
Fire Insurance Rating Organization and/or any other similar body
performing the same or similar functions and having jurisdiction or
cognizance over the Building and/or the Premises, whether how or
hereafter in force.
(d) The term "Tenant" shall mean the Tenant herein
named or any assignee or other successor in interest (immediate or
remote) of the Tenant herein named, which at the time in question is
the owner of the Tenant's estate and interest granted by this Lease;
but the foregoing provisions of this subsection shall not be construed
to permit any assignment of this Lease or to relieve the Tenant herein
named or any assignee or other successor in interest (whether immediate
or remote) of the Tenant herein named from the full and prompt payment,
performance and observance of the covenants, obligations and conditions
to be paid, performed and observed by Tenant under this Lease.
(e) The term "Landlord" shall mean only the owner at
the time in question of Landlord's interest in the Land and the
Building or a lease of the Land and the Building so that in the event
of any transfer or transfers of Landlord's interest in the Land and the
Building or a lease thereof the transferor shall be and hereby is
relieved and freed of all obligations of Landlord under this Lease
accruing after such transfer, and it shall be deemed, without further
agreement that such transferee has assumed and agreed to perform and
observe all obligations of Landlord herein during the period it is the
holder of Landlord's interest under this Lease.
(f) The terms "herein," "hereof" and "hereunder," and
words of similar import, shall be construed to refer to this Lease as a
whole, and not to any particular article or section. unless expressly
so stated.
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(g) The term "and/or" when applied to one or more
matters or things shall be construed to apply to any one a more or all
thereof as the circumstances warrant at the time in question.
(h) The term "person" shall `mean any natural person or
persons, a partnership, a corporation, and any other form of business
or legal association or entity.
(i) The terms "Landlord shall have no liability to
Tenant" or "the same shall be without liability to Landlord" or
"without incurring any liability to Tenant therefor", or words of
similar import $hall mean that except as provided in Section 35.04(b)
and 35.04(c), Tenant is not entitled to terminate this Lease, or to
claim actual or constructive eviction, partial, or total, or to receive
any abatement or diminution of rent, or to be relieved in any manner of
any of its other obligations hereunder, or to be compensated for loss
or injury suffered or to enforce any other right or kind of liability
whatsoever against Landlord under or with respect to this Lease or with
respect to Tenant's use or occupancy of the Premises.
(j) The term "Interest Rate," when used in this Lease,
shall mean an interest rate equal to two percent (2%) above the
so-called annual "Base Rate" or "prime rare" of interest established
and approved by The Chase Manhattan Bank, New York, New York, from time
to time (or if The Chase Manhattan Bank shall cease to exist or cease
to announce such rate, any similar rate which is publicly announced
from time to time by any other bank designated by Landlord in the City
of New York having combined capital and surplus in excess of
$1,000,000,000), as its interest rate charged for unsecured loans to
its corporate customers, but in no event greater than the highest
lawful rate from time to time in effect.
(k) The term "Consumer Price Index" shall mean the
Consumer Price Index for All Urban Consumers ("CPI-AUC"), New York, New
York-Northeastern New Jersey, All Items (1982-1984=100), issued and
published by the Bureau of Labor Statistics of the United States
Department of Labor. In the event that CPI-AUC ceases to use a 1982-84
base rate of 100 as the basis of calculation, or if a substantial
change is made in the terms or number of items contained in CPI-AUC,
then the CPI-AUC shall be adjusted to the figure that would have been
arrived at had the manner of computing the CPI-AUC in effect at the
date of this Lease not been altered. If CPI-AUC is not available, the
term Consumer Price Index shall mean (i) a successor or substitute
index to CPI-AUC, appropriately adjusted; or (ii) if such a successor
or substitute index is not available or may not lawfully be used for
the purposes herein stated, a reliable governmental or other
non-partisan publication, selected by Landlord and approved by Tenant
(which approval shall not be unreasonably withheld or delayed),
evaluating the information theretofore used in determining CPI-AUC.
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(l) The term "Business Days" shall mean all days except
Saturdays, Sundays, New Year's Day, Washington's Birthday, Memorial
Day, Independence Day, Labor Day, Thanksgiving, the day following
Thanksgiving, and Christmas, and any other days which shall be observed
by both the federal and the state governments as legal holidays.
35.06. Upon the expiration or other termination of this Lease
neither party shall have any further obligation or liability to the
other except as otherwise expressly provided in this Lease and except
for such obligations as by their nature or under the circumstances can
only be, or by the provisions of this Lease, may be, performed after
such expiration or other termination; and, in any event, unless
otherwise expressly provided in this Lease, any liability for a payment
(including, without limitation, Additional Charges under Article 3)
which shall have accrued to or with respect to any period ending at the
time of expiration or other termination of this Lease shall survive the
expiration or other termination of this Lease.
35.07. (a) If Tenant shall request Landlord's consent and
Landlord shall fail or refuse to give such consent, Tenant shall not be
entitled to any damages for any withholding by Landlord of its consent,
it being intended that Tenant's sole remedy shall be an action for
specific performance or injunction, and that such remedy shall be
available only in those cases where Landlord has expressly agreed in
this Lease not to unreasonably withhold its consent or where as a
matter of law Landlord may not unreasonably withhold its consent. The
foregoing provisions of this Section 35.07(a) shall not be deemed to
exculpate Landlord from liability for unreasonably withholding its
consent in any case where (i) Landlord has expressly agreed in this
Lease not to unreasonably withhold its consent, or where as a matter of
law Landlord may not unreasonably withhold its consent, (ii) Landlord
in fact withholds such consent, and (iii) Tenant obtains a final,
non-appealable judgment against Landlord from a court of competent
jurisdiction to the effect that Landlord acted in bad faith in doing
so.
(b) If Tenant desires to determine any dispute between
Landlord and Tenant as to the reasonableness of Landlord's decision to
refuse to consent or approve any item as to which Landlord has
specifically agreed that its consent or approval shall not be
unreasonably withheld, Tenant shall have the right to have such dispute
settled and finally determined by arbitration in The City of New York
in accordance with the following provisions of this subsection
35.07(b). Within ten (10) Business Days next following the giving of
any notice by Tenant stating that it wishes such dispute to be so
determined, Landlord and Tenant shall each give notice to the other
setting forth the name and address of an arbitrator designated by the
party giving such notice. If either party (herein called the
"Non-Notifying Party") shall fail to give such a notice designating its
arbitrator within such ten (10) Business Day period, then the other
party (herein called the "Notifying Party") may give a second notice to
the Non-Notifying Party making specific reference to this Section
35.07(b) and stating that if the Non-Notifying Party fails to designate
its arbitrator within a further period of seven (7) Business Days
following
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the giving of such second notice, then the dispute in question shall be
determined by the single arbitrator designated by the Notifying Party.
If the Non-Notifying Party shall fail to designate its arbitrator
within the 7-Business Day Period following the giving of such second
notice in accordance with the preceding sentence, then the dispute in
question shall be determined by the single arbitrator designated by the
Notifying Party. If two arbitrators are so designated and the two
arbitrators shall fail to agree upon the designation of a third
arbitrator within five (5) Business Days after the designation of the
second arbitrator then either party may apply to the American
Arbitration Association in New York City for the designation of such
arbitrator and if he is unable or refuses to act within ten (10)
Business Days, then either party may apply to the Supreme Court in New
York County or to any other court having jurisdiction for the
designation of such arbitrator. The three arbitrators or single
arbitrator designated in accordance with the procedures set forth in
this Section 35.07(b) shall conduct such hearings as they deem
appropriate, making their determination in writing and giving notice to
Landlord and Tenant of their determination as soon as practicable, and
if possible, within five (5) Business Days after the designation of the
third arbitrator. The concurrence of or, in the event no two of the
arbitrators shall render a concurring determination, then the
determination of the third arbitrator designated, shall be binding upon
Landlord and Tenant, provided, however, that in the event only a single
arbitrator is designated pursuant to the provisions of this Section
35.07(b), then the determination of such single arbitrator shall be
binding upon Landlord and Tenant. Judgment upon any decision rendered
in any arbitration held pursuant to this subsection 35.07(b) shall be
final and binding upon Landlord and Tenant, whether or not a judgment
shall be entered in any court. Each party shall pay its own counsel,
witness and expert fees and expenses, if any, in connection with any
arbitration under this subsection 35.07(b), including the expenses and
fees of any arbitrator selected by it in accordance with the provisions
of this subsection 35.07(b), and the parties shall share all other
expenses and, fees of any such arbitration. The sole remedy which may
be awarded by the arbitrators in any proceeding pursuant to this
Section 35.07 is an order compelling Landlord to consent to or approve
the matter in dispute, and the arbitrators may not award damages or
grant any monetary award or any other form of relief. The arbitrators
shall be bound by the provisions of this Lease, and shall not add to,
subtract from or otherwise modify such provisions.
35.08. If any Superior Mortgagee shall require any
modification(s) of this Lease, Tenant shall, at Landlord's request,
promptly execute and deliver to Landlord such instruments effecting
such modification(s) as Landlord shall require, provided that such
modification(s) are of a ministerial nature or do not increase Tenant's
obligations or decrease its right under this Lease.
35.09. If an excavation shall be made upon land adjacent to or
under the Building, or shall be authorized to be made, Tenant shall
afford to the person causing or authorized to cause such excavation,
license to enter the Premises for the purpose of performing
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such work as said person shall deem necessary or desirable to preserve
and protect the Building from injury or damage to support the same by
proper foundations, without any claim for damages or liability against
Landlord and without reducing or otherwise affecting Tenant's
obligations under this Lease.
35.10. Tenant shall not place a load upon any floor of the
Premises which violates applicable law or the certificate of occupancy
of the Building or which exceeds the floor load per square foot which
such floor was designed to carry. Following the completion of the
Building Work, Landlord represents and warrants that the permitted
floor loads in the Building shall be as required by the applicable
provisions of the New York City Building Code. All heavy material
and/or equipment must be placed by Tenant, at Tenant's expense, so as
to distribute the weight. Business machines and mechanical equipment
shall be placed and maintained by Tenant, at Tenant's expense, in
settings sufficient to absorb and prevent vibration or to dampen same
adequately. If the Premises be or become infested with vermin as a
result of the use or any misuse or neglect of the Premises by Tenant,
its agents, employees, visitors or licensees, Tenant shall at Tenant's
expense cause the same to be exterminated.
35.11. The submission by Landlord of this Lease in draft form
shall be deemed submitted solely for Tenant's consideration and not for
acceptance and execution. Neither such submission nor any response by
Tenant shall have any binding force or effect nor shall same confer any
rights nor impose any obligations, including brokerage obligations, on
either party unless and until both Landlord and Tenant shall have
executed this Lease and duplicate originals thereof shall have been
delivered to the respective parties.
35.12. Irrespective of the place of execution or performance,
this Lease shall be governed by and construed in accordance with the
laws of the State of New York. If any provisions of this Lease or the
application thereof to any person or circumstance shall, for any reason
and to any extent, be invalid or unenforceable, the remainder of this
Lease and the application of that provision to other persons or
circumstances shall not be affected but rather shall be enforced to the
extent permitted by law. The table of contents, captions, headings and
titles in this Lease are solely for convenience of references and shall
not affect its interpretation. This Lease shall be construed without
regard to any presumption or other rule requiring construction against
the party causing this Lease to be drafted. Each covenant, agreement,
obligation or other provision of this Lease on Tenant's part to be
performed, shall be deemed and construed as a separate and independent
covenant of Tenant, not dependent on any other provision of this Lease.
All terms and words used in this Lease, shall be deemed to include any
other number and any other gender as the context may require.
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35.13. If under the terms of this Lease Tenant is obligated to
pay Landlord a sum in addition to the Fixed Rent under this Lease and
no payment period therefor is specified, Tenant shall pay Landlord the
amount due within twenty (20) days after being billed.
35.14. Notwithstanding anything to the contrary contained in
this Lease, during the continuance of any default by Tenant after the
giving of notice and the expiration of any applicable grace periods
hereunder, Tenant shall not be entitled to exercise any rights or
options, or to receive any funds or proceeds being held, under or
pursuant to this Lease, subject to reinstatement of such rights or
options or right to receive funds or proceeds if such default is cured
prior to any termination of this Lease by reason of such default.
35.15. Each party represents and warrants that this Lease has
been duly authorized, executed and delivered by such party.
35.16. Tenant acknowledges that, notwithstanding that the
Premises leased to Tenant hereunder include the Land, Tenant has no
rights to any development rights, "air rights" or comparable rights
appurtenant to the Real Property, and consents, without further
consideration, to any utilization of such rights by Landlord and agrees
to promptly execute and deliver any instruments which may be reasonably
requested by Landlord, including instruments merging zoning lots,
solely evidencing such acknowledgment and consent. The provisions of
this Section 35.16 shall be deemed to be and shall be construed as an
express waiver by Tenant of any interest Tenant may have as a "party in
interest" (as such quoted term is defined in Section 12-10 Zoning Lot
of the Zoning Resolution of the City of New York) in the Real Property.
Notwithstanding anything to the contrary contained in the Lease, Tenant
may not, without the prior written consent of Landlord in each
instance, which consent may be withheld in Landlord's sole and absolute
discretion (i) change the zoning of the Premises, (ii) modify the
"bulk" or "FAR" (as such quoted terms are defined in the New York
Zoning Resolution) of the Premises, (iii) grant or permit any easement,
right of way, restrictive covenant or other similar encumbrance against
the Premises, or (iv) increase the square footage or usable area of the
Building. During the term of this Lease, Landlord shall not (i) change
the zoning of the Premises, (ii) modify the "bulk" or "FAR" (as such
quoted terms are defined in the New York Zoning Resolution) of the
Premises, (iii) grant or permit any easement, right of way, restrictive
covenant or other similar encumbrance against the Premises, or (iv)
increase the square footage or usable area of the Building, if the
action referred to in clause (i), (ii), (iii) or (iv) of this sentence
would adversely affect, except to an immaterial extent, Tenant's use or
enjoyment of the Premises (including, without limitation, Tenant's
rights to use the roof as permitted under this Lease) or Tenant's
ability to make Alterations or would preclude Landlord under applicable
Legal Requirements from restoring the Buildi1ig in the event of a fire
or other casualty to substantially the same floor area as exists on the
date of this Lease.
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35.17. If any sales or other tax is payable with respect to
any cleaning or other services which Tenant obtains or contracts for
directly from any third party or parties, Tenant shall file any
required tax returns and shall pay any such tax, and Tenant shall
indemnify and hold Landlord harmless from and against any loss, damage
or liability suffered or incurred by Landlord on account thereof.
35.18. In connection with any examination by Tenant of
Landlord's books and records, Tenant agrees to treat, and to instruct
its employees, accountants and agents to treat, all information as
confidential and not disclose it to any other person, except (i) as may
be required by applicable Legal Requirements or (ii) in a court of
competent jurisdiction or by arbitration or in connection with any
action or proceeding before a court of competent jurisdiction or
arbitrator, or (iii) to Tenant's attorneys, accountants and either
professionals in connection with any dispute between Landlord and
Tenant or on an "as needed" basis to Tenant's lenders and underwriters;
and Tenant will confirm or cause its agents and accountants to confirm
such agreement in a separate written agreement if requested by
Landlord.
35.19. (a) Tenant shall not cause or permit Hazardous
Materials [as such term is defined in this Section 35.19(a)] to be
used, transported, stored, released, handled, produced or installed in,
on or from, the Premises, other than the reasonable amounts required in
the normal operation and maintenance of Tenant's fixtures and equipment
in the Premises and the cleaning, maintenance and operation of the
Premises (provided same are maintained in accordance with all
applicable Legal Requirements and insurance requirements). The term
"Hazardous Materials" shall, for the purposes hereof, mean any
flammable explosives, radioactive materials, hazardous wastes,
hazardous and toxic substances, or related materials, asbestos or any
material containing asbestos, or any other substance or material, as
defined by any federal, state or local environmental law, ordinance,
rule or regulation including, without limitation, the Comprehensive
Environmental Response Compensation and Liability Act of 1980, as
amended, the Hazardous Materials Transportation Act, as amended, the
Resource Conservation and Recovery Act, as amended, and in the
regulations adopted and publications promulgated pursuant to each of
the foregoing. In the event of a breach of the provisions of this
Section 35.19, Landlord shall, in addition to all of its rights and
remedies under this Lease and pursuant to law, require Tenant to remove
any such Hazardous Materials from the Premises in the manner prescribed
for such removal by Legal Requirements. The provisions of this Section
35.19 shall survive the termination of this Lease.
(b) In the event there exist any Hazardous Materials in
the Premises on the date of this Lease which have not been introduced
into the Premises by Tenant, or anyone acting under or through Tenant,
and which are required under applicable Legal Requirements in effect
and applicable to the Premises on the date of this Lease to be removed
or abated, then, Landlord shall have no liability to Tenant and this
Lease shall not be affected on account thereof, but,
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unless the need for such removal or abatement arises from any
structural Alterations made by Tenant or any Alterations made by
Tenant to those portions of the Building Systems installed by Landlord,
Landlord shall, promptly after written notice from Tenant, remove such
Hazardous' Materials from the Premises in the manner prescribed for
such removal by Legal Requirements.
(c) Landlord represents and warrants to Tenant that the
existing 10,000 gallon heating oil storage tank at the Property was
closed and abandoned in compliance with applicable Legal Requirements.
Notwithstanding anything to the contrary contained herein, Landlord
shall indemnify, defend and hold harmless Tenant and its partners,
officers, directors, principals, shareholders and employees against and
from any and all loss, liability, damages, costs and expenses
(including without limitation reasonable attorneys' fees) resulting
from any third-party claim arising out of the continued presence of
such heating oil storage tank at the Property, any failure to have
properly decommissioned such tank in compliance with all applicable
Legal Requirements and any release that may have occurred or shall
occur from such tank at any time.
35.20. Wherever in this Lease either party's consent or
approval is required not to be unreasonably withheld, such consent or
approval shall not be unreasonably delayed or conditioned, it being
understood and agreed that any specific time periods or conditions set
forth in this Lease for the giving of such consent or approval shall be
deemed reasonable.
ARTICLE 36
Partnership Tenant
36.01. If Tenant's interest in this Lease shall be assigned to
a partnership (or to two (2) or more persons, individually and/or as
co-partners of a partnership) (any such partnership and such persons
are referred to in this section as "Partnership Tenant"), the following
provisions of this Article 36 shall apply to such Partnership Tenant:
(a) the liability of each of the parties comprising Partnership Tenant
(other than limited partners of a limited partnership) shall be joint
and several, (b) each of the parties comprising Partnership Tenant
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 Premises to Landlord or renewing or extending this Lease
and by any notices, demands, requests or other communications which may
hereafter be given, by Partnership Tenant or by any of the parties
comprising Partnership Tenant, but the foregoing shall not be deemed to
render any limited partners of a limited partnership personally liable
for any obligations of Tenant under this Lease, (c) any bills,
statements, notices, demands, requests or other communications given or
rendered to Partnership Tenant or to any of the parties comprising
Partnership Tenant (other than limited partners of a limited
partnership) shall be
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deemed given or rendered to Partnership Tenant and to all such parties
and shall be binding upon Partnership Tenant and all such parties, (d)
if Partnership Tenant shall admit new partners (other than limited
partners of a limited partnership), all of such new partners (other
than limited partners of a limited partnership) 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, (e) Partnership Tenant shall give
prompt notice to Landlord of the admission of any partner or partners
(other than limited partners of a limited partnership), and within
twenty (20) days after demand of Landlord, shall cause each such
partner (other than limited partners of a limited partnership) to
execute and deliver to Landlord an agreement in form satisfactory to
Landlord, wherein each such new partner (other than limited partners of
a limited partnership) shall assume performance of all of the terms,
covenants and conditions of this Lease on Tenant's part to be observed
and performed (but neither Landlord's failure to request any such
agreement nor the failure of any such new partner to execute or deliver
any such agreement to Landlord shall vitiate the provisions of
subdivision (d) of this section) and (f) on each anniversary of the
Commencement Date, Partnership Tenant shall deliver to Landlord a list
of all partners (other than limited partners of a limited partnership)
together with their current residential addresses.
ARTICLE 37
Industrial and Commercial Incentive Program
37.01. For purposes of this Article 37, the term "Project"
shall mean, collectively, the performance by Landlord of the Building
Work (as such term is defined in Section 2.01 hereto). All other terms
used herein, unless otherwise defined in this Lease, shall have the
meanings ascribed to them in Sections 11-256 through 11-267 of the
Administrative Code of the City of New York, authorized by Title 2-D of
Article 4 of the New York Real Property Tax Law and all rules and
regulations promulgated thereunder (herein collectively called the
"Industrial and Commercial Incentive Program" or the "ICIP Program").
37.02. Landlord hereby notifies Tenant that Landlord is
seeking the benefits and entitlements provided by Section 489-bbbb,
Subdivision 5 of the ICIP Program. Tenant agrees to cooperate with
Landlord to the extent reasonably requested in connection with
Landlord's application so that the Building will receive the benefits
and entitlements provided by the ICIP Program (the "ICIP Benefits").
Landlord makes no representation or warranty to Tenant that the ICIP
Benefits shall be received in whole or in part and, except as provided
in Section 37.04, Landlord shall have no liability to Tenant in the
event the ICIP Benefits are not available to the Building for any
reason whatsoever.
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37.03. At Landlord's request, to the extent required to enable
Landlord to file annual certificates of continuing use as required by
the ICIP Program and/or to continue to receive the ICIP Benefits,
Tenant shall (i) report to Landlord the use of the Premises, the number
of workers permanently engaged in employment in the Premises, the
nature of each worker's employment, the number of such workers who
reside in New York City and the New York City residency of each worker,
and (ii) provide access to the Premises by employees and agents of any
governmental agency enforcing the ICIP Program (including, without
limitation, the New York City Department of Finance ("DOF") at all
reasonable times, upon reasonable notice when requested by Landlord.
During each Tenant Tax Controlled Tax Year, Tenant shall prepare and
timely file (or cause its real estate tax certiorari counsel to prepare
and file) the annual certificate of continuing use as required by the
ICIP Program to be filed with respect to such Tenant Tax Controlled
Tax Year, and shall deliver to Landlord at least twenty (20) days prior
to the deadline for filing such certificate, the completed certificate
for Landlord's execution. Notwithstanding the foregoing provisions of
this Section 37.03, if such certificate is sent to Landlord in the
first instance Landlord shall promptly after receipt forward the same
to Tenant to complete and return to Landlord for execution.
Landlord shall execute and return such certificate to Tenant within
five (5) Business Days after Landlord's receipt thereof, and Tenant
shall file same with the appropriate governmental authority.
37.04. Annexed hereto as Exhibit S is a copy of the
Certificate of Eligibility received by Landlord from the DOF in
response to Landlord's preliminary application for ICIP Benefits
(herein called "Landlord's Initial ICIP Application"). In accordance
with the requirements of the ICIP Program, Landlord shall within the
time periods required by the ICIP Program file with the DOF the
required evidence of expenditures for Building Work expenses in an
amount not less than the "minimum required expenditures" under the ICIP
Program (herein called "ICIP Expenses"). Landlord currently anticipates
that it shall file evidence of at least $27,000,000 in ICIP Expenses
(herein called the "Minimum ICIP Expenses") and shall in any event file
evidence for all ICIP Expenses incurred in connection with the Building
Work. Landlord represents and agrees that (i) Landlord has complied and
shall continue to comply and cause its contractor to comply with the
reporting requirements of the ICIP Program, (ii) has timely filed and
will continue to timely file interim construction reports in accordance
with the requirements of the ICIP Program, and (iii) Landlord will
timely file the certificate of completion and all required documents,
affidavits and certificates required by the ICIP Program. Without
limiting Tenant's rights under this Article 37, (i) Tenant shall not be
required to pay any Taxes or charges which may become due because of
the willful misconduct, negligence or fraud by Landlord in connection
with the ICIP Program or otherwise relieve or indemnify Landlord from
any personal liability which may arise under Section 11-265 of the
Administrative Code of the City of New York, and (ii) Tenant shall not
be required to pay any Taxes or charges which may become due because of
the failure by Landlord or its contractors to comply with any
requirements of the ICIP Program (unless such failure results from (x)
Tenant's failure to comply
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with its obligations set forth in Section 37.03 hereof, (y) Tenant's
failure to timely pay Taxes in accordance with Article 3 hereof, or (z)
the imposition of or failure to timely cure any violation of Legal
Requirements which is the obligation of Tenant to cure under this
Lease) if, as a result of such failure, Landlord fails to receive ICIP
Benefits with respect to ICIP Expenses in an amount not less than the
Minimum ICIP Expenses. In the event that Tenant believes that it is
entitled to relief from the payment of Taxes pursuant to the provisions
of this Article 37, Tenant shall notify Landlord in writing of such
claim, Tenant shall notify Landlord in writing of such claim, setting
forth in reasonable detail the grounds for such claim. If such claim
cannot be resolved between Landlord and Tenant within 15 days after the
delivery of such a notice, such dispute will be submitted by either
party for resolution by binding arbitration in accordance with the
provisions of Exhibit AA of this Lease. Each arbitrator in any such
proceedings shall be a real estate tax certiorari attorney with not
less than 10 years experience in ICIP benefits in New York City and
shall not then he representing either Landlord or Tenant or their
respective affiliates. In any such arbitration, Tenant shall be
required to demonstrate that (i) Landlord has failed to receive ICIP
Benefits as a result of the breach of its obligations under this
Article 37, and (ii) as a result of the failure to receive such ICIP
benefits referred to in clause (i) of this sentence, the real estate
tax assessment for the Real Property is higher than the assessment
would have been if such ICIP Benefits had been obtained. Pending the
resolution of any such dispute, Tenant shall continue to make Tax
Payments in accordance with Article 3 of this Lease. If the resolution
of such dispute is that Tenant has made Tax Payments in excess of the
amount Tenant is obligated to pay pursuant to this Section 37.04,
Landlord shall reimburse Tenant for such overpayment, together with
interest on same at the Interest Rate, within 20 days following such
final resolution. If Landlord fails to reimburse Tenant within such
20-day period, Tenant may send to Landlord a second notice stating that
if Landlord fails to reimburse Tenant for such overpayment within 5
Business Days following the giving of such second notice, Tenant shall
offset such overpayment together with interest thereon at the Interest
Rate against the next payment of Fixed Rent due hereunder. If Landlord
fails to reimburse Tenant for such overpayment and interest as
aforesaid within such 5 Business Day period, Tenant may offset such
overpayment and interest as aforesaid against the next payment of Fixed
Rent due hereunder.
37.05. Tenant hereby agrees that it shall indemnify and hold
harmless, subject to Section 18.03 hereof, Landlord and its partners,
directors, officers, agents and employees from and against any and all
claims, loss, damage, liability, cost or expense arising from the
Building's failure to qualify for or the loss of the ICIP Benefits as a
result of (x) Tenant's failure to comply with its obligations set forth
in Section 37.03 hereof, (y) Tenant's failure to timely pay Taxes in
accordance with Article 3 hereof, or (z) the imposition of or failure
to timely cure any violation of Legal Requirements which is the
obligation of Tenant to cure under this Lease.
37.06. In the event the ICIP Benefits are lost or reduced for
any reason other than Landlord's willful misconduct, negligence or
fraud, Landlord agrees to cooperate with Tenant, at
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Tenant's expense, in pursuing any remedies available to Tenant against
third parties by reason of such loss or reduction.
ARTICLE 38
Layout and Finish
38.01. The provisions of this Article 38 shall apply
with respect only to the Office Premises and nothing contained in this
Lease shall be construed as requiring Landlord to make any contribution
to the costs incurred by Tenant to prepare the Retail Premises for
Tenant's occupancy thereof. Tenant hereby covenants and agrees that
Tenant will, at Tenant's own cost and expense, and in a good and
workmanlike manner, make and complete the work and installations in and
to the Office Premises set forth below.
Tenant, at Tenant's expense, shall prepare a final plan or
final set of plans and specifications (which said final plan or final
set of plans, as the case may be, and specifications are herein called
the "final plan") which shall contain complete information and
dimensions necessary for the construction and finishing of the Office
Premises and for the engineering in connection therewith. The final
plan shall be submitted by Tenant to Landlord for Landlord's written
approval, which approval shall be governed by the provisions of Article
11 hereof, including without limitation, the time periods for
responding to such final plans. If Landlord shall disapprove the final
plan, Landlord shall set forth its reasons for such disapproval and
itemize those portions of the final plan so disapproved. In the event
that, following the approval by Landlord of Tenant's final plan, Tenant
shall modify the final plan, then if such modification is of such
scope that it would, standing alone constitute a Material Alteration,
then such modification shall be subject to Landlord's written
approval, which approval shall be governed by the provisions of
Article 11 hereof. If such modification is of such scope that it would,
standing alone, constitute a Non-Material Alteration, then such
modification shall not require Landlord's approval, provided however,
the plan (herein called "Modified Plan") reflecting such modifications
to the final plan must be submitted to Landlord at least three (3)
Business Days prior to the performance of the work shown on the
Modified Plan. In the event Tenant disputes Landlord's disapproval of
all or any portion of the final plan. Tenant shall notify Landlord of
such dispute in writing not later than fifteen (15) days after receipt
of Landlord's notice of disapproval. Any such dispute which is not
resolved within ten (10) days after receipt of such notice shall be
resolved by Expedited Arbitration. In the event that Landlord
wrongfully withholds its approval of all or any portion of the final
plan, then, if Tenant is actually delayed in occupying the Office
Premises for the conduct of its business or using the Retail Premises
for the purposes permitted hereunder (including subleasing to a user or
use by a subtenant) as a result of such wrongful
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disapproval, such wrongful disapproval shall be deemed a Landlord Delay
within the meaning of Section 2.01(f) hereof.
In accordance with the final plan, Tenant, at Tenant's
expense, will make and complete in and to the Office Premises the work
and installations (herein called "Tenant's Work") specified in the
final plan. Tenant agrees that Tenant's Work will be performed in
accordance with the all of the terms, covenants and provisions of
Article 11 hereof and the Construction/Alteration Rules annexed as
Exhibit E hereto. Tenant agrees that Tenant will use reasonable efforts
in performing Tenant's Work so as to minimize disturbance to the
structural and mechanical parts of the Building and Tenant will, at its
own cost and expense, leave all structural and mechanical parts of the
Building which shall or may be affected by Tenant's Work in good and
workmanlike operating condition upon completion of Tenant's Work.
Subject to the provisions of Section 18.03 hereof, Tenant hereby
covenants and agrees to indemnify and save harmless Landlord of and
from all claims, counsel fees, loss, damage and expenses whatsoever by
reason of any injury or damage, howsoever caused, to any person or
property occurring prior to the completion of Tenant's Work or
occurring after such completion, as a result of anything done or
omitted in connection therewith or arising out of any fine, penalty or
imposition or out of any other matter or thing connected with any work
done or to be done or materials furnished or to be furnished in
connection with Tenant's Work. At any and all times during the progress
of Tenant's Work, Landlord at Landlord's sole cost shall be entitled to
have a representative or representatives on the site to inspect
Tenant's Work and such representative or representatives shall have
free and unrestricted access to any and every part of the Office
Premises provided, however, (i) that any such representative shall use
reasonable efforts to minimize any interference with the performance of
Tenant's Work and (ii) under no circumstances shall it be deemed or
construed that Landlord shall have incurred any liabilities,
obligations or responsibilities to Tenant or any third party by reason
of the access, inspections or review of Tenant's plans provided in this
Section 38.01, subject, however, to the provisions of Section 2.01(f)
hereof. Landlord hereby approves Xxxxxx Construction and Xxxxxx
XxXxxxxx as contractors for Tenant's Work.
38.02. All Tenant's Work shall be performed by Tenant
in accordance with Article 11 hereof and the Construction/Alteration
Rules annexed hereto as Exhibit E.
38.03. Landlord shall, at Tenant's written request,
cooperate in all reasonable respects with Tenant in the performance by
Tenant of Tenant's Work in preparing the Premises for Tenant's
occupancy and Landlord shall instruct its employees and contractors to
render such assistance and to cooperate with Tenant's employees,
representatives and contractors provided that to the extent that
Landlord shall incur any expense in so cooperating or in rendering such
assistance, Tenant shall reimburse Landlord for such expense as
Additional Charges hereunder.
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38.04. (a) Landlord shall allow Tenant an allowance in the
amount, subject to the last sentence of this Section 38.04(a), of Seven
Million Three Hundred Twenty-One Thousand Sixty-Three and 50/100
($7,321,063.50) Dollars (herein called the "Work Allowance"), which
Work Allowance shall be applied solely against the cost and expense of
the actual construction work performed by Tenant in connection with
Tenant's Work in the Office Premises, and reasonable architect's,
engineer's and consultant's fees in connection therewith (herein
collectively called the "Construction Costs"). In the event that the
Construction Costs shall exceed the amount of the Work Allowance,
Tenant shall be entirely responsible for such excess. If Tenant does
not use all or any part of the Work Allowance for Construction Costs,
then the Work Allowance shall be reduced accordingly.
(b) The Work Allowance shall be payable by Landlord to
Tenant from time to time within twenty (20) days after periodic
requisitions (each being herein called "Tenant Requisition") submitted
by Tenant to Landlord as Tenant's Work progress (and such Work
Allowance may, at Tenant's option, be paid against the first
Construction Costs incurred in connection with Tenant's Work even if
the total estimated Construction Costs exceed the Work Allowance), but
no more frequently than monthly. Prior to the payment of any portion of
the Work Allowance, Tenant shall deliver to Landlord a Tenant's
Requisition for disbursement signed by an officer of Tenant which shall
be accompanied by (1) invoices for the Tenant's Work performed in
connection therewith (which need not be paid invoices), (2) a
certificate signed by Tenant's architect certifying that Tenant's Work
represented by the aforesaid invoices has been satisfactorily completed
in accordance with the final plan, and (3) partial conditional lien
waivers from the general contractor and Major Subcontractors, in the
form annexed hereto as Exhibit T, who shall have performed the work
referenced in the Tenant Requisition submitted immediately prior to the
subject Tenant Requisition. As used herein the term "Major
Subcontractor" shall mean any subcontractor performing any portion or
portions of Tenant's Work if the amounts paid to such subcontractor for
such portion(s) of Tenant's Work are reasonably expected to exceed
$100,000. Tenant shall, upon request, furnish to Landlord a copy of the
subcontract or other evidence reasonably satisfactory to Landlord of
the amounts expected to be paid to any subcontractor which Tenant
claims is not a Major Subcontractor. Promptly after completion of
Tenant's Work, Tenant shall deliver to Landlord final "as-built"
drawings, and all sign-offs, inspection certificates and permits
required to be issued by the New York City Building Department, Fire
Department and by any other governmental entities having jurisdiction
thereover.
(c) The Work Allowance is being given for the benefit
of Tenant only. No third party shall be permitted to make any claims
against Landlord with respect to any portion of the Work Allowance.
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38.05. (a) In connection with the performance of Tenant's
Work, Tenant shall perform the work listed on Exhibit U annexed hereto
(herein called the "Additional Tenant Work") at Tenant's sole cost and
expense and in accordance with all of the terms and provisions of this
Article 38 (other than Section 38.04) and Article 11 and the
Construction/Alteration Rules annexed as Exhibit E hereto. Landlord
shall allow Tenant an allowance in the amount, subject to the last
sentence of this Section 38.05(a), of Five Hundred Eighty Nine Thousand
Six Hundred ($589,600.00) Dollars (herein called the "Additional
Tenant Work Allowance"), which Additional Tenant Work Allowance shall
be applied solely against the Construction Costs for the Additional
Tenant Work. The Additional Tenant Work shall be completed by Tenant no
later than five (5) years after the Commencement Date. In the event
that the Construction Costs for the Additional Tenant Work shall exceed
the amount of the Additional Tenant Work Allowance, Tenant shall be
entirely responsible for such excess. If Tenant does not use all or any
part of the Additional Tenant Work Allowance for Construction Costs for
the Additional Tenant Work, then the Additional Tenant Work Allowance
shall be reduced accordingly.
(b) The Additional Tenant Work Allowance shall be
payable by Landlord to Tenant from time to time within twenty (20) days
after periodic Tenant Requisitions submitted by Tenant to Landlord as
the Additional Tenant Work progresses signed by an officer of Tenant,
but no more frequently than monthly. Prior to the payment of any
portion of the Additional Tenant Work Allowance, Tenant shall deliver
to Landlord a Tenant's Requisition for disbursement signed by an
officer of Tenant which shall be accompanied be (1) invoices for the
Additional Tenant Work performed in connection therewith (which need
not be paid invoices), (2) a certificate signed by Tenant's architect
certifying that the Additional Tenant Work represented by the aforesaid
invoices has been satisfactorily completed in accordance with the final
plan, and (3) partial conditional lien waivers from the general
contractor and Major Subcontractors, in the form annexed hereto as
Exhibit T, who shall have performed the work referenced in the Tenant
Requisition submitted immediately prior to the subject Tenant
Requisition. Promptly after completion of the Additional Tenant Work,
Tenant shall deliver to Landlord final "as-built" drawings, and all
sign-offs, inspection certificates and permits required to be issued by
the New York City Building Department, Fire Department and by any other
governmental entities having jurisdiction thereover.
(c) The Additional Tenant Work Allowance is being given
for the benefit of Tenant only. No third party shall be permitted to
make any claims against Landlord or Tenant with respect to any portion
of the Additional Tenant Work Allowance.
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ARTICLE 39
First Extension of Term
39.01. Subject to the provisions of Section 39.09 hereof, Tenant shall
have the right to extend the term of this Lease for an additional term often
(IO) years which shall commence on the day following the expiration of the
initial term of this Lease (herein called the "First Extension Term Commencement
Date") and ending on the day preceding the tenth (10th) anniversary of the.
First Extension Term Commencement Date (such additional term is herein called
the "First Extension Term" and such last day of such First Extension Term is
herein called the "First Extension Expiration Xxxx"), provided that:
(i) Tenant shall give Landlord notice (herein called the
"First Extension Notice") of its election to extend,the term of
this Lease at least eighteen (18) months prior to the expiration
of the initial term of this Lease,
(ii) Tenant is not, after notice and expiration of
applicable grace periods, in default of any of Tenant's monetary
or material non-monetary obligations under this Lease as of the
time of the giving of the First Extension Notice and as of the
First Extension Term Commencement Date (which condition Landlord
may elect to waive in its sole discretion), and
(iii) As of the time of the giving of the First
Extension Notice and as of the First Extension Term Commencement
Date, Tenant and/or Tenant's Affiliates are in actual occupancy
(other than vacancies not in preparation for subletting to a
party that is not an Affiliate) of not less than twenty-five
(25%);percent of the Office Premises (which condition Landlord
may elect to waive in its sole discretion).
39.02. The Fixed Rent per annum payable by Tenant to Landlord during
the First Extension Term shall be at the rate of one hundred (100%) percent of
the fair market rent for the Premises as determined by Landlord (subject to
Tenant's right to dispute such determination as provided in Section 39.04
hereof), which determination shall be as of the date occurring six (6) months
prior to the First Extension Term Commencement Date (herein called the "First
Determination Date") and which determination shall be made by Landlord and given
in writing to Tenant (the "First Rent Notice") within a reasonable period of
time after the occurrence of the First Determination Date.
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39.03. During the First Extension Term. the provisions of Article 3
hereof shall be unmodified and remain in full force and effect (i.e., Tenant
shall continue to make payments of the Tax Payment and the Operating Payment on
a net basis, recognizing that there are no base years).
39.04. In the event that Tenant disputes the amount of the fair market
rent of the Premises For the First Extension Term ai determined by Landlord
pursuant to Section 39.02 hereof- then at any time on or before the date
occurring thirty (30) days after Tenant has received the First Rent Notice,
Tenant may initial the arbitration process provided for herein by giving notice
to that effect to Landlord, and if Tenant so initiates the arbitration process
such notice shall specify the name and address of the person designated to act
as an arbitrator on its behalf. Within twenty (20) days after Landlord's receipt
of notice of the designation of Tenant's arbitrator, Landlord shall give notice
to Tenant specifying the name and address of the person designated to act as an
arbitrator on its behalf. Neither Landlord nor Landlord's arbitrator shall be
bound by nor shall any reference be made to the determination of the Fixed Rent
of the Premises for the First Extension Term which was furnished by Landlord in
the First Rent Notice. If Landlord fails to notify Tenant of the appointment of
its arbitrator within such 20-day period, then Tenant shall provide an
additional notice to Landlord requiring Landlord's appointment of an arbitrator
within five (5) Business Days after Landlord's receipt thereof. If Landlord
fails to notify Tenant of the appointment of its arbitrator within the time
specified by the second notice, the appointment of the second arbitrator shall
be made in the same manner as hereinafter provided for the appointment of a
third arbitrator in a case where the two arbitrators appointed hereunder and the
parties are unable to agree upon such appointment. The two arbitrators so chosen
shall meet within ten (IO) days after the second arbitrator is appointed, and
shall exchange sealed envelopes each containing such arbitrator's written
determination of the fair market rent of the Premises during the First Extension
Term. The fair market rent specified by Landlord's arbitrator shall herein be
called "Landlord's Submitted Value" and the fair market rent specified by
Tenant's arbitrator shall herein be called "Tenant's Submitted Value." Copies of
such written determinations shall promptly be sent to both Landlord and Tenant.
If the higher determination of fair market rent for the Premises is not more
than one hundred five percent (105%) of the lower determination of the fair
market rent, then the fair market rent for such space shall be deemed to be the
average of the two determinations. If, however, the higher determination is more
than one hundred five percent (105%) of the lower determination, then within
five (5) days of the date the arbitrators submitted their respective fair market
rent determinations, the two arbitrators shall together appoint a third
arbitrator. In the event of their being unable to agree upon such
appointment,within said five (5) day period, the third arbitrator shall be
selected by the parties themselves if they can agree thereon within a further
period of five (5) days. If the parties do not so agree, then either party, on
behalf of both and on notice to the other, may request such appointment by the
American Arbitration Association (or any SUCCESSOR organization thereto) in
accordance with its rules then prevailing or if the American
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Arbitration Association (or any successor organization thereto) in accordance
with its rules then prevailing or if the American Arbitration Association (or
such successor organization) shall fail to appoint said third arbitrator within
fifteen (15) days after such request is made, then either party may apply, on
notice to the other, to the Supreme Court, New York County, New York (or any
other court having jurisdiction and exercising functions similar to those now
exercised by said Court) for the appointment of such third arbitrator. Within
five (5) days after the appointment of such third arbitrator (herein called the
"Section 39.04 Period"), Landlord's arbitrator shall submit Landlord's Submitted
Value to such third arbitrator and Tenant's arbitrator shall submit Tenant's
Submitted Value to such third arbitrator. Such third arbitrator shall, within
ten (10) days after the end of such Section 39.04 Period, make his own
determination of the fair market rent of the Premises during the First Extension
Term and send a notice along with a copy of this determination promptly to both
Landlord and Tenant and in such notice shall state whether Landlord's Submitted
Value or Tenant's Submitted Value was closer to the determination by such third
arbitrator of the fair market rent of the Premises during the First Extension
Term. Whichever of Landlord's Submitted Value or Tenant's Submitted Value shall
be closer to the determination by such third arbitrator shall conclusively be
deemed to be the fair market rent for the Premises during the First Extension
Term.
39.05. Each party shall pay the fees and expenses of the one of the two
original arbitrators appointed by or for such party, and the fees and expenses
of the third arbitrator and all other expenses (not including the attorneys
fees, witness fees and similar expenses of the parties, which shall be borne
separately by each of the parties) of the arbitration shall be borne by the
parties equally.
39.06. In making their determination of the fair market rent of the
Premises, the arbitrators shall take into consideration all then relevant
factors, including, without limitation, that the provisions of Article 3 hereof
shall be unmodified and remain in full force and effect during the First
Extension Term, and the fact that Tenant is not receiving any work allowance or
work letter or free rent period, and that no brokerage commission is being paid,
in connection with such lease extension. The arbitrators shall not add to,
subtract from or otherwise modify the provisions of this Lease. Each of the
arbitrators selected as herein provided shall have at least ten (10) years
experience in the leasing of office and retail space first class buildings
containing both office and retail use in midtown Manhattan.
39.07. In the event Tenant initiates the arbitration process pursuant
to Section 39.04 hereof and as of the First Extension Term Commencement Date the
amount of the fair market rent has not been determined, Tenant shall pay
Landlord's Submitted Value as rent for the First Extension Term, and Tenant
shall continue to make payments of the Tax Payment and the Operating Payment in
accordance with the provisions of Article 3 hereof, and when such determination
has been made, an appropriate retroactive adjustment shall be made as of the
First Extension Term Commencement Date, and if an overpayment has been made,
Landlord shall
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promptly refund to Tenant the amount of such overpayment, together with interest
on such overpayment at the Interest Rate from the date(s) paid by Tenant to the
date fully refunded; provided, however, if Landlord and Tenant have exchanged
Landlord's Submitted Value and Tenant's Submitted Value, then pending such
determination of the fair market rent, Tenant shall pay the average of
Landlord's Submitted Value and Tenant's Submitted Value. If Landlord fails to
refund such overpayment by Tenant and interest within fifteen (15) days after
such final determination and such failure continues for a further period of five
(5) Business Days following the giving of a second notice from Tenant which
second notice shall set forth the amount due to Tenant and Tenant's intention to
offset such amounts from the next payments of Fixed Rent hereunder if same are
not paid to Tenant within such five (5) Business Day Period, a copy of which
second notice shall be delivered simultaneously to any Superior Lessor or
Superior Mortgagee whose name and address shall have previously have been
furnished to Tenant, then Tenant may offset such amounts from the next payments
of Fixed Rent hereunder if same are not paid to Tenant within such five (5)
Business Day Period.
39.08. Except as otherwise provided in this Article 39 or elsewhere in
this Lease, Tenant's occupancy of the Premises during the First Extension Term
shall be on the same terms and conditions as are in effect immediately prior to
the expiration or the initial term of this Lease; provided, however, that Tenant
shall not be entitled to: (i) any abatement of Fixed Rent or Additional Charges
as set forth in Article 1 hereof, (ii) any Work Allowance provided for in
Article 38 hereof or any other work allowance elsewhere provided for in this
Lease, or (iii) any further right to extend the term of this Lease pursuant to
this Article 39.
39.09. If Tenant does not timely send the First Extension Notice
pursuant to the provisions of Section 39.01 hereof, this Lease shall
automatically terminate at the end of the term and Tenant shall have no further
right to extend the term of this Lease. Time shall be of the essence with
respect to the giving of the First Extension Notice. The termination of this
Lease during the initial term hereof shall also terminate and render void any
option or right on Tenant's part to extend the term of this Lease pursuant to
this Article 39 whether or not such option or right shall have theretofore been
exercised. The termination of this Lease during the First Extension Term shall
also terminate and render void any option or right on Tenant's part to extend
the term of this Lease for the Second Extension Term, whether or not such option
shall have theretofore been exercised. Notwithstanding the foregoing, however,
if Tenant shall have exercised any option to extend the term of this Lease prior
to a termination by reason of Tenant's default hereunder, then damages shall be
calculated pursuant to Article 24 hereof as if said option were validly
effectuated. None of Tenant's options or elections set forth in this Article 39
may be severed from this Lease or separately sold, assigned or transferred.
39.10. If this Lease is renewed for the First Extension Term, then
Landlord or Tenant may request the other party hereto to execute an amendment of
this Lease setting forth the
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exercise of Tenant's right to extend the term of this Lease, the Fixed Rent
for the First Extension Term and the last day of the First Extension Term;
provided however, the failure of either party hereto to so execute such
instrument shall not in any way affect the Tenant's exercise of its right to
extend the term of this Lease pursuant to this Article 39.
39.11. If Tenant exercises its right to extend the term of this Lease
for the First Extension Term pursuant to this Article 39, (i) the phrases "the
term of this Lease" or "the term hereof" as used in this Lease, shall be
construed to include, when practicable, the First Extension Term, and (ii) the
term "Expiration Date" as used in this Lease shall be construed to mean the
First Extension Expiration Date.
ARTICLE 40
Second Extension of Term
40.01. Subject to the provisions of Section 40.07 hereof and provided
that Tenant shall have exercised its right to extend the term of this Lease for
the First Extension Term pursuant to Article 39 hereof, Tenant shall have the
right to extend the term of this Lease for an additional term of ten (10) years
which shall commence on the day following the First Extension Expiration Date
(herein called the "Second Extension Term Commencement Date") and ending on the
day preceding the tenth (10th) anniversary of the Second Extension Term
Commencement Date (such additional term is herein called the "Second Extension
Term" and such last day of such Second Extension Term is herein called the
"Second Extension Expiration Date"), provided that:
(i) Tenant shall give Landlord notice (herein called the
"Second Extension Notice") of its election to extend the term of
this Lease at least eighteen (18) months prior to the First
Extension Expiration Date,
(ii) Tenant is not, after notice and expiration of
applicable grace periods, in default of any of Tenant's monetary
or material non-monetary obligations under this Lease as of the
time of the giving of the Second Extension Notice and as of the
Second Extension Term Commencement Date (which condition
Landlord may elect to waive in its sole discretion), and
(iii) As of the time of the giving of the Second
Extension Notice and as of the Second Extension Term
Commencement Date, Tenant and/or Tenant's Affiliates are in
actual occupancy (other than vacancies not in
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preparation for subletting to a party that is not an Affiliate)
of not less than twenty-five (25%) percent of the Office
Premises (which condition Landlord may elect to waive in its
sole discretion).
40.02. The Fixed Rent per annum payable by Tenant to Landlord during
the Second Extension Term shall be at the rate of one hundred (100%) percent of
the fair market rent for the Premises as determined by Landlord (subject to
Tenant's right to dispute such determination as provided in Section 40.04
hereof), which determination shall be as of the date occurring six (6) months
prior to the Second Extension Term Commencement Date (herein called the "Second
Determination Date") and which determination shall be made by Landlord and given
in writing to Tenant (the "Second Rent Notice") within a reasonable period of
time after the occurrence of the Second Determination Date.
40.03. During the Second Extension Term, the provisions of Article 3
hereof shall be unmodified and remain in full force and effect (i.e., Tenant
shall continue to make payments of the Tax Payment and the Operating Payment on
a net basis, recognizing that there are no base years).
40.04. In the event Tenant disputes the fair market rent of the
Premises for the Second Extension Term as determined by Landlord pursuant to
Section 40.02 hereof, then at any time on or before the date occurring thirty
(30) days after Tenant has received the Second Rent Notice, Tenant may initiate
the arbitration process provided for in Section 39.04 hereof, and such
provisions and the provisions of Section 39.06 hereof shall apply to the
determination of fair market rent for the Second Extension Term.
40.05. In the event Tenant initiates the aforesaid arbitration process
and as of the Second Extension Term Commencement Date the amount of the fair
market rent has not been determined. Tenant shall pay Landlord's Submitted Value
as rent for the Second Extension Term, and Tenant shall continue to make
payments of the Tax Payment and the Operating Payment in accordance with the
provisions of Article 3 hereof, and when such determination has been made, an
appropriate retroactive adjustment shall be made as of such Second Extension
Term Commencement Date, and if an overpayment has been made, Landlord shall
promptly refund to Tenant the amount of such overpayment together with interest
on such overpayment at the Interest Rate from the date(s) paid by Tenant to the
date fully refunded; provided, however, if Landlord and Tenant have exchanged
Landlord's Submitted Value and Tenant's Submitted Value, then pending such
determination of the fair marker rent, Tenant shall pay the average of
Landlord's Submitted Value and Tenant's Submitted Value. If landlord fails to
refund such overpayment by Tenant and interest within fifteen (15) days after
such final determination and such failure continues for a further period of five
(5) Business Days following the giving of a second notice from Tenant which
second notice shall set forth the amount due to Tenant and
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Tenant's intention to offset such amounts from the next payments of Fixed Rent
hereunder if same are not paid to Tenant within such five (5) Business Day
Period, a copy of which second notice shall be delivered simultaneously to any
Superior Lessor or Superior Mortgagee whose name and address shall have
previously have been furnished to Tenant, then Tenant may offset such amounts
from the next payments of Fixed Rent hereunder if Same are not paid to Tenant
within such five (5) Business Day Period.
40.06. Except as otherwise provided in this Article 40 or elsewhere in
this Lease, Tenant's occupancy of the Premises during the Second Extension Term
shall be on the same terms and conditions as are in effect immediately prior to
the First Extension Expiration Date; provided, however, that Tenant shall not be
entitled to: (i) any abatement of Fixed Rent or Additional Charges as set forth
in Article 1 hereof, (ii) any Work Allowance provided for in Article 38 hereof
or any other work allowance elsewhere provided for in this Lease, or (iii) any
further right to extend the term of this Lease pursuant to this Article 40.
40.07. If Tenant does not timely send the Second Extension Notice
pursuant to the provisions of Section 40.01 hereof, this Lease shall
automatically terminate at the end of the First Extension Term and Tenant shall
have no further right to extend the term of this Lease. Time shall be of the
essence with respect to the giving of the Second Extension Notice. The
termination of this Lease during the initial term hereof or the First Extension
Term shall also terminate and render void any option or right on Tenant's part
to extend the term of this Lease pursuant to this Article 40 whether or not such
option or right shall have theretofore been exercised. The termination of this
Lease during the Second Extension Term shall also terminate and render void any
option or right on Tenant's part to extend the term of this Lease for the Second
Extension Term, whether or not such option shall have theretofore been
exercised. Notwithstanding the foregoing, however, if Tenant shall have
exercised any option to extend the term of this Lease prior to a termination by
reason of Tenant's default hereunder, then damages shall be calculated pursuant
to Article 24 hereof as if said option were validly effectuated. None of
Tenant's options or elections set forth in this Article 40 may be severed from
this Lease or separately sold, assigned or transferred
40.08. If this Lease is renewed for the Second Extension Term, then
Landlord or Tenant may request the other party hereto to execute an amendment of
this Lease setting forth the exercise of Tenant's right to extend the term of
this Lease, the Fixed Rent for the Second Extension Term and the last day of the
Second Extension Term; provided however, the failure of either party hereto to
so execute such instrument shall not in any way affect the Tenant's exercise of
its right to extend the term of this Lease pursuant to this Article 40.
40.09 If Tenant exercises its right to extend the term of this Lease
for the Second Extension Term pursuant to this Article 40, (i) the phrases "the
term of this Lease" or "the term
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hereof" as used in this Lease, shall be construed to include, when practicable,
the Second Extension Term, and (ii) the term "Expiration Date" as used in this
Lease shall be construed to mean the Second Extension Expiration Date.
ARTICLE 41
Historic Tax Credits
41.01. (a) Notwithstanding anything to the contrary contained in this
Lease, but subject to the provisions of Sections 41.01(b) and 41.02 hereof,
Tenant shall not make any Alterations prior to the end of the five (5) year
period (the "Recapture Period") beginning on the date the Building is "placed in
service" within the meaning of IRS Regulation 1.46-3(d) which will result in the
loss, reduction or recapture of any Historic Tax Credits to which Landlord would
otherwise be entitled pursuant to Landlord's Historic Preservation Certification
Application - Part 2 (filed October 12, 1998 and approved March 21, 1999).
Except as otherwise provided in this Article 41, in the event any Alterations
are made by Tenant during the Recapture Period which are objected to by the NPS
(as such term is defined in Section 41.01(b) hereof) and are not removed or
rectified by Tenant to the satisfaction of the NPS within the cure period, if
any, permitted by the NPS and which thereby result in the loss, reduction or
recapture of any such Historic Tax Credits, Tenant shall reimburse Landlord for
the full value to Landlord amount of such loss, reduction or recapture
including, without limitation, penalties and interest. If any amount recoverable
by Landlord will be or has been subject to tax, Tenant shall pay to Landlord the
amount (after taking into account any tax in respect of the amount) that will
ensure that Landlord receives and retains a net sum equal to the sum it would
have received had the payment from the Tenant not been subject to tax and which
will compensate Landlord for any additional taxes, interest or penalty charges
which have been or will be incurred by Landlord by reason of Tenant's
Alterations made prior to the end of the Recapture Period. Such payment shall be
made by Tenant within twenty (20) days after demand therefor (but in no event
earlier than thirty (30) days prior to the date Landlord is required to pay the
corresponding tax payment to the taxing authority) as Additional Charges, which
demand shall be accompanied by a copy of any demand or invoice from the taxing
authority setting forth the calculation of the amount payable by Landlord.
Landlord agrees, within fifteen (15) days after written request from Tenant, to
provide Tenant with such information relating to the Building Work within
Landlord's (or its contractors' or consultants') possession as Tenant may
reasonably request to determine the "placed in service" date.
(b) (i) Landlord and Tenant acknowledge and agree that, except as
hereinafter expressly provided, prior to the commencement of any Alterations,
Landlord shall, at Tenant's sole cost and expense, file the plans and
specifications therefor delivered to Landlord by
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Tenant with the National Park Service of the U.S. Department of the Interior
("NPS") together with a request for approval of same as an amendment to
Landlord's Historic Preservation Certification Application - Part 2 (herein
called an "NPS Amendment Filing"), and Tenant shall not commence such
Alterations unless and until the written approval of the NPS to such NPS
Amendment Filing is obtained.
(ii) Prior to making an NPS Amendment Filing with respect to
Alterations which are limited to the interior of the Building, Landlord shall
submit Tenant's plans and specifications therefor to Landlord's tax consultant
("Landlord's Tax Credit Consultant") (currently Xxxxxxx X. XxxXxxxxx of Xxxxx &
Xxxxx and if Xxxxxxx X. XxxXxxxxx is unable or unwilling to continue in that
capacity, Landlord's Tax Credit Consultant shall be a member of a "Big 5"
accounting firm with at least 10 years experience in the Historic Tax Credits)
for the Historic Tax Credits and Landlord shall not make or require any NPS
Amendment Filing with respect to any such interior Alterations unless Landlord's
Tax Credit Consultant advises Landlord that such a filing is recommended.
Landlord shall advise Tenant of such recommendation of Landlord's Tax Credit
Consultant within the time periods Landlord is required to approve or disapprove
Tenant's plans and specifications for Alterations pursuant to Section 11.01
hereof, and, if such recommendation is that an NPS Amendment Filing should be
made, Landlord shall advise Tenant within such time period of the changes
required by Landlord's Tax Credit Consultant in order for Landlord's Tax Credit
Consultant, in his sole discretion, to recommend that an NPS Amendment Filing
not be required. If Landlord's Tax Credit Consultant does not recommend an NPS
Amendment Filing with respect to such interior Alterations, then Tenant may
proceed with such Alterations subject to and in accordance with the provisions
of this Lease (other than this Article 41) and Tenant shall not be responsible
for any portion of the Historic Tax Credits which may be lost, reduced or
recaptured by reason of the performance by Tenant of such interior Alterations.
If Landlord's Tax Credit Consultant shall recommend an NPS Amendment Filing for
any such interior Alterations, then Landlord shall notify Tenant of such fact
and Landlord shall make such NPS Amendment Filing with the NPS unless, within
ten (10) days after receipt of Landlord's notice Tenant requests Landlord in
writing to refrain from making such filing. In the event Tenant so requests,
Landlord shall not make an NPS Amendment Filing with respect to such interior
Alterations and Tenant may proceed with such interior Alterations subject to and
in accordance with the provisions of this Lease, but Tenant shall remain
responsible for any portion of the Historic Tax Credits which may be lost,
reduced or recaptured ("grossed up" as provided in Section 41.01(a) hereof) by
reason of the performance by Tenant of such interior Alterations.
(iii) If Tenant shall desire to make any Alterations without Landlord
making an NPS Amendment Filing (or prior to obtaining a response to an NPS
Amendment Filing), Tenant shall so request of Landlord in writing. Landlord
shall permit such Alterations to be made (subject to the provisions or this
Lease, including Article 11 hereof) without making an
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NPS Amendment Filing (or prior to obtaining a response to an NPS Amendment
Filing, as the case may be) provided and on condition that: (A) Tenant shall
remain responsible for any portion of the Historic Tax Credits which may be
lost, reduced or recaptured ("grossed up" as provided in Section 41.01(a)
hereof) by reason of the performance by Tenant of such Alterations, and (B) at
least ten (10) days prior to the commencement of such Alterations, Tenant shall
deposit with Landlord's attorneys (which shall be a law firm having at least 100
attorneys which carries customary liability insurance), an amount equal to the
full amount of any such potential loss, reduction or recapture, as reasonably
determined by Landlord's Tax Consultant, "grossed-up" as provided in Section
41.01(a) hereof (collectively, the "Estimated Tax Credit Loss"). The amount of
such Estimated Tax Credit Loss shall be held in escrow until the earlier to
occur of (x) receipt of a determination by NPS approving such Alterations, in
which event the Estimated Tax Credit Loss shall be returned to Tenant, (y)
receipt of a determination by the NPS disapproving such Alterations, in which
event the Landlord's Estimated Tax Credit Loss shall be held by Escrow Agent
until the alterations are removed or rectified by Tenant to the satisfaction of
NPS (whereupon same will be released to Tenant) or until such earlier date as
Landlord is required to pay Landlord's Estimated Tax Credit Loss to the taxing
authority (whereupon same shall be released to Landlord for such purpose,
subject to Landlord's reimbursement obligations under Section 41.02 hereof in
the event of a subsequent reduction in Landlord's Estimated Tax Credit Loss), or
(z) the last day of the Recapture Period, in which event the Estimated Tax
Credit Loss shall be returned to Tenant. The Estimated Tax Credit Loss shall be
held and disbursed by the escrow agent in accordance an escrow agreement which
conforms to this Section 41.01(b)(iii) and is otherwise in form and substance
reasonably satisfactory to Landlord, Tenant and the escrow agent, and which
provides for the escrow funds to deposited in an interest bearing account with
Citibank, N.A. or another major commercial bank having a branch in New York
City, or, if available as an investment vehicle to the escrow agent, such escrow
funds shall be invested in US Treasury securities.
(iv) The provisions of clause (B) of the second sentence of Section
41.01(b)(iii) shall not apply (but the provisions of clause (A) of the second
sentence of Section 41.01(b)(iii) shall apply) with respect to Alterations
proposed to be made by Tenant without an NPS Amendment Filing (or prior to
receiving a response to an NPS Amendment Filing) which, in the reasonable
judgment of Landlord's Tax Consultant on the basis of his review of Tenant's
plans and specifications therefor, are limited to the placement of signage on
portions of the facade of the Building previously approved by NPS for signage in
accordance with such approvals.
(c) All NPS Amendment Filings shall be made by Landlord promptly after
receipt of Tenant's plans and specifications therefor (and, in the case of the
plans and specifications for Tenant's Work, such filing shall be made on the
basis of the schematic design drawings for the Building exterior, if any,
submitted by Tenant pursuant to Section 11.01 hereof)
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and thereafter prosecuted with reasonable diligence. If requested by Tenant, in
the event of an unfavorable decision by the NPS regarding any filing made
pursuant to Section 41.01(b) hereof, Landlord shall, at Tenant's sole cost and
expense, pursue administrative or other appeals from such ruling which are
reasonably available to Landlord. Landlord and Tenant shall cooperate with one
another in connection with any such filing, including promptly furnishing any
additional information required by the NPS in connection with any such filing.
Landlord shall furnish Tenant with copies of all filings made by Landlord
pursuant to Section 41.01(b) hereof.
41.02. In the event of an unfavorable ruling by NPS to any proposed
Alterations proposed by Tenant, Tenant shall not be precluded from making such
alteration by reason of such fact if Tenant pays to Landlord the Estimated Tax
Credit Loss prior to commencing any such Alteration or taking such action as the
case may be. In the event that, as a result of an audit or settlement with the
Internal Revenue Service, the amount of Estimated Tax Credit Loss paid by Tenant
is determined to have been less than the actual amount of Landlord's Historic
Tax Credits lost by reason of Tenant's Alterations, Tenant shall reimburse
Landlord for such additional lost Landlord's Historic Tax Credits as Additional
Charges within twenty (20) days after delivery of an invoice therefor which
shall be accompanied by copies of the results of such audit or settlement or
other documents setting forth the final amount of the Historic Tax Credits. In
the event that, as a result of an audit or settlement with the Internal Revenue
Service or by reason of the fact that the time period for auditing or
challenging Landlord's Historic Tax Credits shall have passed without such an
audit or challenge having been raised, the amount of Estimated Tax Credit Loss
paid by Tenant is more than the actual amount of Landlord's Historic Tax Credits
lost by reason of Tenant's Alterations, then Landlord shall reimburse Tenant
within fifteen (15) days after such determination is made or such time period
has expired, as applicable, for the excess Estimated Tax Credit Loss paid by
Tenant, together with interest thereon from the date originally paid by Tenant
to the date reimbursement is made at the Interest Rate, and if Landlord fails to
do so and such failure continues for an additional period of five (5) Business
Days following delivery of a notice from Tenant setting forth Tenant's intention
to offset such amounts against the Fixed Rent payable hereunder, Tenant shall
have the right to offset any unpaid excess Estimated Tax Credit Loss paid by
Tenant, together with interest thereon from the date originally paid by Tenant
to the date offset by Tenant at the Interest Rate, against the next
installment(s) of Fixed Rent payable under this Lease.
41.03. In the event that an NPS Amendment Filing for any Alterations
proposed by Tenant is delayed or rejected by reason of Landlord's failure to
perform the Building Work in accordance with the requirements of the NPS
relating to the Historic Tax Credits (including, without limitation, the use of
non-complying materials) or Landlord's failure to comply with the administrative
or filing requirements related thereto (a "Landlord Tax Credit Fault"), and, as
a result thereof, either:
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(i) Tenant is delayed in completing Tenant's Work and occupying
all or any portion of the Premises beyond the date Tenant would
have taken occupancy in the absence of such Landlord Tax Credit
Fault (a "Tenant Occupancy Delay"), and/or
(ii) Tenant has entered into a sublease of all or a portion of
the Retail Premises (which may also include the right to place
Signs on the Facade), the subtenant is delayed in taking
occupancy of the Retail Premises (or potion thereof), including,
without limitation, by reason of being unable to install its
Signs or alter the storefront, beyond the date such subtenant
would have taken occupancy in the absence of such Landlord Tax
Credit Fault (a "Retail Sublease Delay") and Tenant thereby
suffers a loss of rent under the terms of such sublease, and/or
(iii) Tenant has entered into a Sign Agreement for the placement
of a Sign or Signs on the Facade, and the Sign User is delayed in
completing the installation of such Sign or Signs beyond the date
such Sign or Signs would have been completed in the absence of
such Landlord Tax Credit Fault (a "Signage Delay") and Tenant
thereby suffers a loss of license fees (or similar income) under
the terms of such Sign Agreement,
then, in any such event, unless Landlord,(at Landlords sole election) permits
Tenant to perform the Alterations in question without obtaining approval of the
NPS Amendment Filing (and releases Tenant from responsibility for any loss,
reduction or recapture of Historic Tax Credits resulting therefrom), Tenant
shall be entitled to an abatement of the Fixed Rent and Additional Charges
pursuant to Article 3 hereof in an amount equal to the Article 41 Abatement
Amount (as such term is defined in this Section 41.03). If a Landlord Tax Credit
Fault occurs, Landlord shall either, at Landlord's election, (i) take such steps
as are necessary to cure such Landlord Tax Credit Fault with reasonable
promptness after Landlord has notice of same, or (ii) permit Tenant to perform
the Alterations in question without obtaining approval of the NPS Amendment
Filing (and release Tenant from responsibility for any loss, reduction or
recapture of Historic Tax Credits resulting therefrom).
As used herein the term "Article 41 Abatement Amount" shall mean:
(A) in the case of a Tenant Occupancy Delay, the Fixed Rent or Additional
Rent pursuant to Article 3 hereof allocable to the portion of the
Premises (which may constitute the entire Premises) which Tenant is so
delayed in occupying for each day of such delay;
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(B) in the case of a Retail Sublease Delay, the Minimum SNDA Rent allocable
to the portion of the Retail Premises (which may constitute the entire
Retail Premises) which such subtenant is so delayed in occupying for
each day of such delay; and
(C) in the case of a Signage Delay, the amount of license fees (or similar
income) allocable to the period of time the Sign User is so delayed in
completing installation of its Signs (the "Signage Delay Period") which
otherwise would have been paid to Tenant under the terms of the Sign
Agreement in question and which are abated as a result of the Signage
Delay; provided, however, that the aggregate Article 41 Abatement
Amount with respect to any Signage Delay(s) shall not exceed an amount
equal to the Minimum SNDA Rents allocable to Retail Premises for such
Signage Delay Period, minus the sum of (x) total rents payable to
Tenant for such Signage Delay Period under the terms of all Retail
Subleases in effect during the Signage Delay Period (without giving
effect to any free or reduced rent periods then in effect thereunder if
and to the extent same exceed commercially reasonable amounts), plus
(y) the amount of any abatement received by Tenant pursuant to clause
(B) of this sentence with respect to the Signage Delay Period.
Landlord shall not be responsible for any delays (and same shall not
give rise to the abatement provided for in this Section 41.03) if and to the
extent any period of delay in obtaining approval of an NPS Amendment Filing
results both from Landlord's failure to perform the Building Work in accordance
with any NPS requirements and from the non-conformance of Tenant's proposed
Alterations with any NPS requirements. Landlord's liability to Tenant for a
Landlord Tax Credit Default shall be limited to the abatements provided for in
this Section 41.03, and in no event shall Landlord be responsible for any
consequential damages to Tenant resulting therefrom.
41.04 For purposes of this Article 41, the term Alterations shall
include, without limitation the installation of Signs (as such term is defined
in Article 42 hereof) and/or Antennae (as such term is defined in Article 33
hereof).
ARTICLE 42
Building Surface Signage and Advertising Rights
42.01. Landlord agrees that, subject to all laws, ordinances statutes,
rules and regulations of all governmental authorities having jurisdiction
thereof, including, without limitation, any restrictions or requirements imposed
by the NPS in connection with the Historic
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Tax Credits, and if and to the extent that same will not make Landlord
ineligible for or reduce or otherwise adversely affect Landlord's eligibility
for Landlord's Historic Tax Credits, subject to the provisions of Section 41.02
hereof, and further subject to the terms, conditions and limitations as are
hereinafter set forth, during the term of this Lease, Tenant, at Tenant's sole
cost and expense, shall have the exclusive right to install, or to grant
licenses to (or enter into similar agreements with) third parties to install, on
any and all portions of the facade, rooftop and setbacks of the Building (herein
collectively called the "Facade") and thereafter maintain, repair, and operate
one or more signs (herein called the "Signs") for the purpose of identifying
Tenant or the Building, or for advertising purposes, provided and on condition
that:
(i) the content and design of such signs shall not relate to
obscene or pornographic activity;
(ii) Tenant shall immediately remove or cause to be removed
any Sign which, in Landlord's reasonable judgment violates the requirement set
forth in clause(i) above (any dispute between Landlord and Tenant with respect
to this Section 42.01(ii) which is not resolved between the parties within ten
(10) days after notice of such dispute from either party to the other shall be
finally resolved by Expedited Arbitration);
(iii) subject to Section 18.03 hereof, Tenant shall
indemnify, defend and hold harmless Landlord against and from any and all fines,
loss, liability, damages, costs and expenses (including, but not limited to,
reasonable counsel fees) incurred by Landlord in connection with the
installation and/or operation or maintenance of the Signs;
(iv) except as provided in any Subtenant SNDA entered into
with a Sign User pursuant to Section 7.12(g) hereof, the granting by Tenant to
any third party (herein called a "Sign User") of a right, whether denominated as
a license or other agreement, to install one or more Signs on the Facade (herein
collectively called a "Sign Agreement") shall not create a tenancy or any other
interest in the Premises except a license revocable at will which shall cease
and expire in any event automatically without notice upon the expiration or
termination of this Lease and all acts, omissions and operations of such Sign
Users shall be deemed acts, omissions and operations of the Tenant;
(v) no Sign Agreement shall be for a term (including any
renewal or extension options contained in the Sign Agreement) ending later
than one day prior to the expiration date of the term of this Lease (including,
without limitation, the First Extension Term, if the First Extension Option is
exercised pursuant to Article 39 hereof, and the Second Extension Term, if
the Second Extension Option is exercised pursuant to Article 40 hereof), and a
copy of each executed Sign Agreement (and all ancillary documents executed in
connection
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with, with respect to or modifying such Sign Agreement) shall be delivered to
Landlord prior to the commencement of installation of such Sign;
(vi) Landlord shall not be obligated to enter into any
non-disturbance agreement with respect to any such Sign Agreement, and each Sign
Agreement shall provide that it is subject and subordinate to this Lease and to
any matters to which this Lease is or shall be subordinate; provided, however,
that (A) a Subtenant SNDA given with respect to any subtenant of all or a
portion of the Retail Premises shall cover any Signs which such subtenant has
the right to install; but, except as provided in clause (B) of this sentence,
only on the portion of the exterior of the Building immediately adjacent to the
Retail Premises subleased to such subtenant (e.g., a subtenant of the second
and third floors of the Building which is otherwise entitled to a Subtenant SNDA
shall be entitled to non-disturbance protection for its Signs but only such
Signs as are limited to the exterior of the Building at the second and third
floors), and (B) a Subtenant SNDA given with respect to any retail sublease
covering at least the entire first, second and third floors of the Building
(herein called a "3-Floor Retail Sublease") shall cover any Signs which such
subtenant has the right to install on the portion of the exterior of the
Building immediately adjacent to the first through fifth floors of the Building.
For purposes of the preceding sentence, a sublease shall be deemed to be a
3-Floor Retail Sublease even if a portion of the premises demised thereunder is
sub-sublet back to Tenant or an Affiliate of Tenant (herein called a "Sublease
Back"), provided that at least two (2) full floors demised under such sublease
are not sub-sublet back to Tenant or any Affiliate of Tenant;
(vii) nothing contained herein shall be deemed to prevent
Landlord from installing,a sign in the Building Lobby and a sign at each
entrance to the Building to identify Landlord and/or the Manager, which signs
shall be subject to Tenant's approval, which approval Tenant shall not
unreasonably withhold, or delay (Tenant hereby approving the signs shown on the
plans annexed hereto as Exhibit V);
(viii) the installation and position of the Signs shall comply
with Legal Requirements;
(ix) the installation of any electrical lines (herein called
"Signage Lines") and related equipment in connection with the installation and
operation of the Signs, as well as the manner and location (i.e., routing) of
all Signage Lines and related equipment in connection therewith shall be at
Tenant's sole cost and expense and shall comply with Legal Requirements, and the
method of affixing any Signs to the Building and any penetrations the Building
facade or roof required for the installation of the Signs and/or Signage Lines
shall be subject to Landlord's prior consent, such consent not to be
unreasonably withheld or delayed; and
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(x) the Signs, reasonably required support structures,
Signage Lines and related equipment shall be maintained and kept in repair by
Tenant, at Tenant's sole cost and expense.
42.02. For the purpose of installing, servicing or repairing the
Signs and related equipment, Tenant shall have access to the Facade. All access
by Tenant to the Facade shall be subject to the supervision of Landlord and to
Landlord's reasonable safeguards for the security and protection of the Facade
and the Building including, without limitation, the erection of scaffolding
and/or sidewalk bridges to the extent required by applicable Legal Requirements
or to the extent same would otherwise generally be erected by a prudent owner of
a comparable Building in the Times Square section of Manhattan. Landlord shall
have the right to assign a Building representative to be present during the
duration of Tenant's access to the Facade and Tenant shall pay Landlord's
reasonable; customary charges therefor as Additional Charges.
42.03. Tenant, at Tenant's sole cost and expense, agrees to promptly
and faithfully obey, observe and comply with all Legal Requirements in any
manner affecting or relating to Tenant's use of the Facade as to the
installation, repair, maintenance and operation of any support structures, Signs
and related equipment erected or installed by Tenant pursuant to the provisions
of this Article 42, provided however that Tenant may contest the applicability
of any such Legal Requirements subject to and in accordance with the provisions
of Section 8.02 hereof. Tenant, at Tenant's sole cost and expense, shall secure
and thereafter maintain all permits and licenses required for the installation
and operation of the Signs and any support structures and related equipment
erected or installed by Tenant pursuant to the provisions of this Article 42.
42.04. Tenant agrees that Tenant will pay for all electrical service
required for Tenant's use of the Signs and related equipment erected or
installed by Tenant pursuant to the provisions of this Article 42 in accordance
with Article 14.
42.05. The Signs, support structures and related equipment installed
by Tenant pursuant to the provisions of this Article 42 shall be Tenant's
personal property, and, upon the Expiration Date, or earlier termination of this
Lease, shall be removed by Tenant at Tenant's sole cost and expense, unless
Landlord notifies Tenant not later than 180 days prior to the Expiration Date
(or within twenty (20) days following the earlier termination of this Lease)
that Landlord elects, in Landlord's sole discretion, to retain any such Signs,
support structures and related equipment (collectively, "Retained Signs"), in
which event Tenant shall assign to Landlord or Landlord's designee, effective
from and after the day immediately following the Expiration Date or earlier
termination of this Lease, all right, title and interest of Tenant in and to the
Retained Signs and the income derived therefrom accruing from and after the
Expiration Date or earlier termination of this Lease, as the case may be. All
electrical equipment installed by Tenant in connection with the installation and
operation of the Signs shall be Tenant's personal property.
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Upon the Expiration Date, or earlier termination of this Lease, if Landlord so
directs by written notice to Tenant, Tenant shall promptly remove such
electrical equipment as designated in such notice, at Tenant's sole cost and
expense; provided however that Tenant shall not be obligated to remove any
Signage Lines at the end of the term of this Lease. Tenant, at Tenant's sole
cost and expense, shall promptly repair any and all damage to the Facade and to
any other part of the Building caused by or resulting from the installation,
maintenance and repair, operation or removal of the Signs, support structures,
Signage Lines and related equipment erected or installed by Tenant pursuant to
the provisions of this Article 42 and restore said affected areas to their
condition as existed prior to the installation of the Signs and related
equipment, subject to normal wear and tear. Notwithstanding anything to the
contrary contained in the preceding sentence, in the event Tenant fails to
perform such repair work after notice and expiration of the applicable cure
period, Landlord shall have the option of performing any such repairs, in which
event Tenant shall reimburse Landlord for the actual out-of-pocket expenses
incurred by Landlord as an Additional Charge hereunder within thirty (30) days
after Tenant shall have been billed therefor, which xxxx shall be accompanied by
copies of the invoices for such out-of-pocket expenses
42.06. Tenant agrees that Landlord shall not be required to provide any
services whatsoever in connection with the Signs.
42.07. Tenant covenants and agrees that all installations made by
Tenant on the Facade or in any other part of the Building pursuant to the
provisions of this Article 42 shall be at the sole risk of Tenant, and neither
Landlord nor Landlord's agent or employees shall be liable for any damage or
injury thereto caused in any manner, except to the extent caused by the
negligence or willful misconduct of Landlord, its agents or employees.
42.08. Subject to and in accordance with the provisions of
Section 18.03 hereof, Tenant will, and does hereby agree to, indemnify, defend
and save harmless Landlord from and against: (i) any and all claims, demands,
damages, expenses or losses by reason of any orders, claims or charges resulting
from any work done, or materials or supplies furnished, in connection with the
fabrication, erection, installation, maintenance and operation of the Signs,
support structures, Signage Lines and any related equipment installed by Tenant
pursuant to the provisions of this Article 42; and (ii) any and all claims,
costs, demands, expenses, fees or suits arising out of accidents, damage,
injury or loss to any and all persons and property, or either, whomsoever or
whatsoever resulting from or arising in connection with the erection,
installation, maintenance and operation and repair of the Signs, support
structures, Signage Lines and related equipment installed by Tenant pursuant to
the provisions of this Article 42; except to the extent caused by the negligence
or willful misconduct of Landlord, its agents or employees. If any installations
referred to in this Article 42 should revoke, negate or in any manner impair or
limit any roof warranty or guaranty obtained by Landlord, then Landlord shall
use reasonable efforts to
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give Tenant prior notice of the same (and, to the extent possible, shall
endeavor to do so at the plan approval stage) and Tenant shall reimburse
Landlord for any loss or damage sustained or costs or expenses incurred by
Landlord as a result thereof. Landlord shall deliver to Tenant a copy of any
such roof warranty or guaranty upon written notice from Tenant to Landlord
requesting same.
42.09. All plans and specifications of Tenant's work and installations
to be done and made by Tenant pursuant to the provisions of this Article 42
shall be subject to the prior approval of Landlord, which such approval shall
not be unreasonably withheld or delayed and shall be governed by the provisions
and procedures for plan approvals set forth in Article 11 hereof, and shall be
further subject to inspection and reasonable supervision by Landlord, agreeing
that it shall not be deemed to incur any liability by reason of the provisions
of this Section.
ARTICLE 43
Building Name
43.01. Tenant shall have, the right during the term of this Lease to
select the name of the Building, provided and on condition that such name shall
comply all laws, ordinances, statutes, rules and regulations of all governmental
authorities having jurisdiction thereof, including, without limitation, any
restrictions or requirements imposed by the NPS in connection with any Historic
Tax Credits, and provided further that Landlord's entitlement to such tax
credits would not be reduced or otherwise adversely affected thereby (unless
Tenant pays to Landlord the full amount, discounted to present value, of any
such reduction, as determined by Landlord, prior to naming the Building). The
installation of any signage on the exterior of the Building bearing such name
shall be governed by the provisions of Article 42 hereof.
ARTICLE 44
Right of First Offer on Certain Dispositions of Real Property
44.01. A. If at any time prior to the tenth (10th) anniversary of the
Commencement Date, Landlord shall desire to either (i) sell the Real Property
(herein called an "Outright Sale"), (ii) enter into a long-term ground lease
(i.e., a master lease having a term, including renewal options, in excess of
forty-eight (48) years) (herein called a "Ground Lease"), or (iii) if Landlord
is at any time an entity having the Real Property as its sole asset (or as to
which the Real Property represents at least 95% of its assets), sell a
controlling interest in such
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entity (i.e., fifty (50%) percent or more of the equity and voting interests in
such entity) (herein called an"Entity Sale"), pursuant to a bona fide third
party offer (herein called an "Offer") which is evidenced by a term sheet or
letter of intent signed by the prospective purchaser or lessee (herein called
the "Offeror") or a broker or agent representing such Offeror, or by a signed
contract of sale or Ground Lease, then, provided Tenant is not then in default
hereunder beyond any applicable notice and grace periods with regard to any
monetary default or any other material default, prior to entering into such
transaction with the Offeror, Landlord shall offer (herein called "Landlord's
Offer") to enter into the transaction contemplated by the Offer with Tenant upon
the same terms and conditions as that of the Offer (except as otherwise
specifically provided herein). Notwithstanding the foregoing provisions of this
Section 44.01, Landlord shall not be obligated to make Landlord's Offer in the
case of (i) any sale or ground lease of the Real Property to either Cornerstone
(for so long as Cornerstone remains Landlord's investment adviser) or an
Affiliate of Landlord or, for so long as Cornerstone remains Landlord's
investment adviser, an Affiliate of Cornerstone, or (ii) a foreclosure or
deed-in-lieu of foreclosure, or (iii) the sale or sales of interests in the Real
Property or Landlord to investors or investment groups sponsored by either
Landlord or, for so long as Cornerstone remains Landlord's investment adviser,
Cornerstone wherein Landlord (or, for so long as Cornerstone remains Landlord's
investment adviser, Cornerstone) retains management control of the Real Property
(which shall be deemed to mean retention of ownership of not less than ten (10%)
percent of the total equity interests in the entity which owns the Real Property
and remaining as adviser to the investors with respect to the Property)
following such sale or sales, provided that the provisions of this Article 44.01
shall continue with regard to any Offer(s) received by Landlord from time to
time following any of the transactions referred to in clauses (i), (ii), or
(iii) of this sentence. Tenant shall not be entitled to assign this Lease
following the exercise of its right of first offer pursuant to this Article 44
until either the closing occurs under the executed Contract of Sale between
Landlord and Tenant or such Contract of Sale otherwise terminates in accordance
with its terms. Landlord's Offer shall be in the form of (x) the contract of
sale annexed hereto as Exhibit L (the "Contract of Sale") but containing the
same purchase price and closing date as those set forth in the Offer, in the
case of an Outright Sale, and permitting assignment of the purchaser's interest
thereunder prior to the closing thereunder, provided that the assignee assumes
all of the obligations of the assignor thereunder and that such assignment shall
not relieve the assignor from liability under such Contract of Sale, (y) a
Ground Lease upon all of the terms contained in the Offer and otherwise on
then-customary terms for similar ground lease transactions involving buildings
containing both office and retail use in midtown Manhattan, in the case of a
Ground Lease, and (z) an agreement for the sale of the entity interests upon all
of the terms contained in the Offer and otherwise incorporating the applicable
provisions of the Contract of Sale with appropriate adjustments to reflect the
nature of the transaction as a sale of interests in an owner rather than the
sale of real property.
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B. It is expressly agreed that Tenant's rights under this Article
shall also terminate if Tenant and/or Tenant's Affiliates is no longer in actual
occupancy of at least twenty-five (25%) percent of the Office Premises (which
condition Landlord may elect to waive in its sole discretion).
44.02. In the event an Offer is made, then Landlord shall be free to
sell the Offered Property to any other individual or entity free of any rights
of Tenant hereunder unless within twenty (20) days after the giving of
Landlord's Offer, Tenant shall exercise its right to purchase the Offered
Property by executing and tendering to Landlord two (2) execution originals of
the Contract of Sale, Ground Lease or agreement tendered with Landlord's Offer
pursuant to Section 44.01, together with the downpayment required by such
Contract of Sale or agreement, if any, or any security deposit or other payment
due on signing of the Ground Lease, if any. Time shall be of the essence as to
Tenant's right to tender to Landlord the document and payments required pursuant
to the preceding sentence (the "Acceptance Deliveries") within such twenty (20)
day period. In the event Tenant neither accepts nor rejects Landlord's Offer
within such twenty (20) day period, it shall be deemed that Tenant has rejected
Landlord's Offer. If Tenant exercises its right to purchase the Real Property or
a controlling interest in Landlord in accordance with this Article 44 or to
enter into a Ground Lease, such transaction shall close in accordance with such
Contract of Sale or other agreement executed between Landlord and Tenant
pursuant to this Section 44.02. In the event that Tenant shall not accept
Landlord's Offer by tendering the Acceptance Deliveries within such twenty (20)
day period, then Tenant shall have no further rights in the Real Property
pursuant to such Landlord's Offer, all of which shall be deemed waived by
Tenant, and Landlord shall be free to enter into the transaction which was the
subject of such Landlord's Offer with the Offeror or any other party on such
terms and conditions set forth in the Contract of Sale, Ground Lease or other
agreement, as the case may be, and Tenant covenants and agrees that it shall be
precluded from taking any action to block such transaction (including, without
limitation, filing for injunctive relief or a lis pendens). Notwithstanding the
foregoing, (i) in the event Landlord fails to close the transaction which was
the subject of the Offer within nine (9) months after the date Tenant rejects or
is deemed to have rejected Landlord's Offer, Landlord shall again comply with
the provisions of this Article 44 prior to closing such transaction (and shall
not close such transaction if Tenant shall exercise its rights pursuant to this
Article 44 with respect thereto), or, if such transaction has been terminated,
the provisions of this Article 44 shall again apply with respect to the next
bona-tide offer for an Outright Sale, Ground Lease, or Entity Sale, and (ii) in
the event that, within nine (9) months following the rejection or deemed
rejection by Tenant of a Landlord's Offer, Landlord enters into a contract for
an Outright Sale or Entity Sale or a Ground Lease (or amends such a contract or
lease) and the net economic value to Landlord of the terms of such contract or
lease (as amended, if applicable), is less than 25% of the net economic value of
the original terms of such Offer, then, prior to consummating such transaction
on such revised terms, Landlord shall modify Landlord's Offer to Tenant to
reflect such revised terms, and Tenant shall have a period
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of ten (10) days following the receipt of such revised Landlord's Offer to
accept same in the manner set forth in this Section 44.02. All responses by
Tenant to a Landlord's Offer shall be made by certified mail, return receipt
requested. Tenant, recognizing the confidential nature of Landlord's decision to
offer the Real Property for sale or other disposition as herein provided and any
information furnished to Tenant in connection therewith, shall not disclose to
any third party the fact of Landlord's Offer or any of the information or
materials furnished to it in connection with Landlord's Offer other than in
connection with seeking debt or equity financing in connection with Tenant's
acceptance of Landlord's Offer or as may be required by applicable Legal
Requirements or in connection with any litigation or arbitration between
Landlord and Tenant; provided, however, that Tenant may disclose such
information to its attorneys, accountants, financial advisors, underwriters and
potential lenders. Time shall be of the essence with respect to all time periods
for Tenant to respond to a Landlord's Offer hereunder.
44.03. If Tenant shall accept any Landlord's Offer for an Outright Sale
or Entity Sale and if Tenant shall default in its obligations to close such
Outright Sale or Entity Sale as purchaser under the Landlord's Offer, then,
Tenant shall forfeit its downpayment or other payment and in addition to any
other rights and remedies available to Landlord as a result thereof, Tenant's
rights under this Article 44 shall be terminated and this Article 44 shall be of
no further force and effect.
44.04. Notwithstanding anything to the contrary contained in this
Article 44, (i) Tenant shall not be entitled to exercise the Landlord's Offer
unless at the time of exercise thereof this Lease shall not have been
terminated, and (ii) Landlord shall not be obligated to convey the Real Property
or close the Ground Lease or Entity Sale to Tenant unless on the date fixed for
delivery of the deed or closing (a) the conditions specified in subdivision (i)
of this sentence shall continue to be satisfied, and (b) Tenant shall have paid
to Landlord all Fixed Rent and Additional Charges and other sums and charges due
and/or accrued hereunder and billed to Tenant through such delivery or closing
date.
44.05. Notwithstanding anything to the contrary contained herein but
subject to Tenant's rights under Section 44.02 hereof, in no event shall Tenant
be entitled to more than one (1) opportunity to purchase the Real Property
pursuant to a Landlord's Offer under this Article. Accordingly, upon any sale of
the Real Property to a purchaser or the consummation of a Ground Lease or Entity
Sale with a party that, in any case, is not an Affiliate of Landlord or, for so
long as Cornerstone remains Landlord's investment adviser, Cornerstone, the
rights of Tenant under this Article shall terminate so that no Landlord other
than Massachusetts Mutual Life Insurance Company or, for so long as Cornerstone
remains Landlord's investment adviser, Cornerstone, and their respective
Affiliates shall be bound hereby; provided that with respect to such sale,
Ground Lease or Entity Sale, as the case may be, (i) Landlord shall have
complied with its obligations under Section 44.01 to deliver to Tenant a
Landlord's Offer, (ii) Landlord shall have complied
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with its obligations under Section 44.02 to deliver to Tenant a revised
Landlord's Offer, if applicable, and (iii) Tenant shall have rejected or is
deemed to have rejected such Landlord's Offer and, if applicable, such revised
Landlord's Offer.
44.06. For purposes of this Lease, the term "Affiliate" shall mean,
with respect to Landlord or Cornerstone, as the case may be, a (i) corporation
into or with which Landlord or Cornerstone is merged or consolidated, (ii)
corporation or partnership or LLC to which substantially all of Landlord's (or
Cornerstone's) assets are transferred or (iii) corporation or partnership or LLC
which controls, is controlled by or is under common control with Landlord (or
Cornerstone). For purposes hereof, the term "control" shall mean, in the case of
a corporation, ownership, directly or indirectly, of at least fifty (50%)
percent of all the voting stock, and in case of a joint venture or partnership
or LLC or other entity, ownership, directly or indirectly, of at least fifty
(50%) percent of all the interests therein.
44.07. In the event the Landlord's Offer is waived or deemed waived as
above provided, Tenant shall within five (5) Business Days after request
therefor, deliver an instrument in the form annexed hereto as Exhibit
W confirming such waiver, but no such instrument shall be necessary to make the
provisions hereof effective.
44.08. No option or election of or by Tenant set forth in this
Article 44 may be severed from this Lease or separately sold, transferred or
assigned (i.e., other than to a permitted assignee in connection with a
permitted assignment of this Lease) or transferred.
44.09. Notwithstanding anything to the contrary contained in this
Lease, until the tenth (10th) anniversary of the Commencement
Date or such earlier date as Tenant's rights under this Article 44 shall
terminate, Landlord shall not (i) enter into any agreement providing for the
leasing or occupancy of any portion of the Premises unless such agreement
automatically terminates upon the exercise by Tenant of its right of first offer
under this Article 44, or (ii) grant an option to a third party to purchase the
Premises unless such option, whether or not the same has been exercised by the
optionee, automatically terminates upon the exercise by Tenant of its right of
first offer under this Article 44.
ARTICLE 45
Leasehold Financing
45.01 (a) Tenant shall have the right from time to time during the term
of this Lease, to mortgage the leasehold estate created hereby and, subject to
the provisions of Section 7.10 hereof, to collaterally assign all subrents,
income and profits derived by Tenant
161
from the leasehold estate created hereby to an Institutional Lender [as such
term is defined in this Section 45.01(a)] without Landlord's consent, and to
collaterally assign this Lease as security for such Leasehold Mortgage (as such
term is hereinafter defined); provided that no Leasehold Mortgage shall extend
to, affect, or be a lien or encumbrance upon the estate and interest of Landlord
in the Premises or any part thereof or any rents or other sums payable by Tenant
under this Lease or any other rents, income or profits derived by Landlord from
the Real Property, and provided further that at any time during the term of this
Lease, there shall be no more than one such Leasehold Mortgage which shall be a
lien on Tenant's leasehold estate in this Lease. For purposes of this Article
45, the following terms shall apply:
(x) "Leasehold Mortgage" shall mean a mortgage or a deed of trust that
constitutes a lien on Tenant's interest in this Lease and the
leasehold estate created hereby;
(y) "Leasehold Mortgagee" shall mean a holder of a Leasehold Mortgage
in respect to which notice of the execution of such Leasehold
Mortgage has been given to Landlord; and
(z) "Institutional Lender" shall mean a commercial bank, savings bank,
trust company, insurance company, savings and loan association,
pension or retirement fund, or real estate investment trust;
provided and on condition that each of the foregoing entities
shall qualify as an institutional Lender only if it shall (A) be
subject (or agree to be subject) to the jurisdiction of the courts
of the State of New York in any action with respect to the rights
hereunder as a Leasehold Mortgagee, and (B) have net assets of not
less than $500,000,000.
(b) In no event shall any Leasehold Mortgagee have the rights or
benefits specified herein, nor shall the provisions of this Section 45.01 be
binding on Landlord with respect to any Leasehold Mortgage or any assignment
thereof, as the case may be, unless and until (i) an executed counterpart of
such Leasehold Mortgage or of such assignment, as the case may be, shall have
been delivered to Landlord, and (ii) the Leasehold Mortgagee shall have executed
and delivered to Landlord an Intercreditor Agreement (which Landlord agrees to
execute and deliver to such Leasehold Mortgagee within ten (10) days after
receipt of a counterpart thereof executed by such Leasehold Mortgagee),
substantially in the form annexed hereto as Exhibit R-2 (except that the
foregoing requirement contained in this clause (ii) shall not apply in the case
of a Leasehold Mortgage in favor of The Bank of New York, as agent (or its
successors and/or assigns), which has entered into an Intercreditor Agreement
with Landlord simultaneously with the execution of this Lease in the form
annexed hereto as Exhibit R-3).
162
45.02 If Tenant shall mortgage Tenant's interest in the leasehold
estate created hereby in compliance with the provisions of Section 45.01 hereof,
then so long as such Leasehold Mortgage shall remain unsatisfied of record, the
following provisions shall apply:
(a) Landlord, upon serving Tenant with any notice of default
pursuant to the provisions of Article 16 hereof, shall also concurrently serve a
copy of such notice upon any Leasehold Mortgagee at the address designated by
such Leasehold Mortgagee in a written notice given to Landlord, and such notice
of default shall be sent by Landlord in the same manner as set forth in Article
33 hereof, and no such notice of default by Landlord shall be deemed to have
been duly given unless and until a copy thereof has been so served upon the
Leasehold Mortgagee.
(b) If Tenant defaults in fulfilling any of its obligations
under this Lease, the Leasehold Mortgagee shall have the right to cure such
defaults within the applicable time prescribed therefor in this Lease, and shall
have the additional time periods provided for in subparagraph 45.02 (e) below
prior to any termination of this Lease on account of such default, and Landlord
shall accept such performance by the Leasehold Mortgagee as if such default had
been cured by Tenant.
(c) No surrender, cancellation, modification or amendment of
this Lease shall bind the Leasehold Mortgagee if done without its prior written
consent.
(d) Except as expressly provided in this Article 45, the
execution and delivery of a Leasehold Mortgage shall not give a Leasehold
Mortgagee any greater rights against Landlord than those granted to Tenant under
this Lease.
(e) Anything contained in this Lease to the contrary
notwithstanding, if any default shall occur which entitles Landlord to terminate
this Lease, Landlord shall, in accordance with Section 45.02(a) hereof, notify
any Leasehold Mortgagee whose name and address shall have been previously
furnished to Landlord in accordance with Section 45.02(a) hereof, and Landlord
shall not have the right to terminate this Lease on account of any such default
which is not cured by Tenant following the giving of notice and the expiration
of the applicable cure period hereunder, provided and for so long as:
(i) within ten (10) Business Days after its receipt
of Landlord's notice of default, such Leasehold Mortgagee shall notify Landlord
of such Leasehold Mortgagee's agreement to cure such default, and
163
(ii) if such default is a default in the payment of
Fixed Rent or Additional Charges, then, within the time period permitted for the
cure of such default by Tenant under this Lease plus an additional period of ten
(10) Business Days, such Leasehold Mortgagee shall pay or cause to be paid all
Fixed Rent and Additional Charges then due and in arrears as specified in
Landlord's default notice (other than any damages in the nature of accelerated
rent for future periods on account of Tenant's default), and
(iii) in the case of any default other than a default
in the payment of Fixed Rent or Additional Charges ("Non-Monetary Defaults"),
within the time period permitted for the cure of such default by Tenant under
this Lease plus an additional period of thirty (30) days, such Leasehold
Mortgagee shall have cured or cause the cure of all Non-Monetary Defaults of
Tenant hereunder; provided, however, that if such Leasehold Mortgagee reasonably
requires possession of the Premises to cure such Non-Monetary Default, then,
provided and for so long as the Leasehold Mortgagee has instituted foreclosure
proceedings promptly after receipt of Landlord's notice of default and
thereafter diligently prosecutes same to completion, the time period for
Leasehold Mortgagee to cure such default shall be extended for so long as is
reasonably required for such Leasehold Mortgagee to obtain possession of the
Premises; provided, further, that with respect to any default in any material
covenant of Tenant under the Lease, in no event shall the Leasehold Mortgagee be
entitled to an extension of more than one hundred twenty (120) days beyond the
cure period provided for Tenant to cure such Non-Monetary Default under this
Lease.
If following the giving of a notice by a Leasehold Mortgagee of its
agreement to cure a default of Tenant hereunder, such Leasehold Mortgagee shall
notify Landlord that such Leasehold Mortgagee has relinquished and surrendered
possession of the Premises or has discontinued (or will not commence, as the
case may be) foreclosure proceedings to obtain possession of the Premises (a
"Rescission Notice"), then such Leasehold Mortgagee shall have no further right
or obligation to continue to cure the default in question, and Landlord shall be
under no further obligation to such Leasehold Mortgagee pursuant to this Article
45 with respect to such default and Landlord shall not be permitted to make any
claim against Leasehold Mortgagee on account of the Leasehold Mortgagee's
agreement to cure a default hereunder or its rescission of such agreement (but
the foregoing shall not limit Tenant's liability with respect to any such
default).
45.03 (a) In the event of the termination of this Lease prior to the
expiration of the term of this Lease, whether by summary proceedings to
dispossess, service of notice to terminate, or otherwise, due to any default by
Tenant or condition referred to in Article 16 hereof, unless such termination
occurs as a result of a default as to which Leasehold Mortgagee has given notice
to Landlord pursuant to Section 45.02(e)(i) hereof of its agreement to cure and
has thereafter failed to cure same within the cure periods provided for in
Section 45.02(e)(ii) or
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45.02(e)(iii) hereof (unless Leasehold Mortgagee elects not to pursue such
cure, delivers to Landlord a Rescission Notice in connection therewith, has
timely cured all defaults referred to in Section 45.02(e)(ii) and thereafter
pays (or causes to be paid) to Landlord all Fixed Rent and Additional Charges as
same become due and payable under the Lease, other than damages in the nature of
an acceleration of rent for future periods), Landlord shall deliver written
notice of such termination to the Leasehold Mortgagee concurrently with the
giving of such notice to Tenant (herein called the "Termination Notice") and in
the same manner as required under Article 33 hereof, together with a statement
of any and all sums of money which would then be due and payable under this
Lease but for such termination, and of any other defaults, if any, under this
Lease then known to Landlord. The Leasehold Mortgagee shall thereupon have the
option of entering into a new lease with Landlord for the Premises on the terms
described in subparagraph (c) below (herein called the "New Lease"), effective
upon termination of this Lease, and if the Leasehold Mortgagee shall so elect,
the Leasehold Mortgagee shall make written request upon Landlord for such New
Lease within ten (10) Business Days after the date of the giving of the
Termination Notice pursuant to this Section 45.03.
(b) In the event that the Leasehold Mortgagee shall commence a
proceeding against Tenant to foreclose the Leasehold Mortgage and shall
foreclose the same or shall take a similar action (e.g., exercise of power of
sale), the Leasehold Mortgagee shall promptly notify Landlord of such mortgage
foreclosure or action and shall, within ten (10) Business Days following the
date of such mortgage foreclosure or otherwise obtaining possession of the
Premises, enter into the New Lease with Landlord, effective upon termination of
this Lease.
(c) In the event of the termination of this Lease by Landlord pursuant
to subsection 45.03(a) above, or the foreclosure of the Leasehold Mortgage by
the Leasehold Mortgagee pursuant to subsection 45.03(b) above. Landlord agrees
to enter into the New Lease with the Leasehold Mortgagee or its designee
(provided that such designee shall satisfy all of the criteria for a proposed
assignee as set forth in Article 7 hereof), upon the following terms and
conditions:
(i) Such New Lease shall be for the remainder of the term of
this Lease, effective as of the date of such termination, at the Fixed
Rent and Additional Charges and upon all of the then executory
agreements, terms, covenants and conditions of this Lease. Such New
Lease shall require the Leasehold Mortgagee or to designee to remedy
any existing defaults of Tenant hereunder, other than any default of a
kind which is not reasonably susceptible of being remedied by a
leasehold mortgagee and other than the payment of damages hereunder in
the nature of accelerated rent for future periods.
(ii) Upon the execution of such New Lease, the Leasehold
Mortgagee or its designee, as the case may be, shall pay to Landlord
165
simultaneously with the execution and delivery of such New Lease, any
and all sums which would at the time of execution and delivery thereof
be due pursuant to this Lease but for such termination and, in addition
thereto, all fees and expenses, including reasonable attorneys' fees
and court costs, which Landlord shall have incurred in connection with
such termination, recovery of possession and the preparation and
execution of the New Lease.
(iii) The Leasehold Mortgagee or its designee shall have
deposited with Landlord a sum of money which shall be sufficient to
replenish the Security Deposit to the amount required to be maintained
by Tenant hereunder pursuant to Article 5 hereof (if Landlord has drawn
down on all or any portion of such Security Deposit).
(iv) As security for the obligations under the New Lease, the
Leasehold Mortgagee or its designee shall have executed and delivered
to Landlord a Collateral Assignment of Subleases and Subrents in the
form annexed hereto as Exhibit R.
45.04 Except as specifically set forth in this Article 45, nothing
contained herein shall be construed as limiting Landlord's remedies under this
Lease or applicable law in the event of a default by Tenant under this Lease,
nor shall Tenant be released from its obligations or liabilities to Landlord
hereunder. In the event that Landlord and the Leasehold Mortgagee shall enter
into the New Lease pursuant to Section 45.03 hereof, Tenant shall nevertheless
remain liable for all of the Leasehold Mortgagee's obligations under the New
Lease. If the New Lease is terminated by reason of a default of the tenant
thereunder, Landlord shall retain all rights and remedies available to Landlord
against Tenant.
45.05 A standard mortgagee clause naming a Leasehold Mortgagee may be
added to any and all insurance policies required to be carried by Tenant
hereunder on condition that the insurance proceeds are to be applied in the
manner specified in this Lease and the Leasehold Mortgage shall so provide.
45.06 So long as any Leasehold Mortgage is in existence, unless the
Leasehold Mortgagee shall otherwise expressly consent in writing, the fee title
to the Premises and the leasehold estate shall not merge but shall remain
separate and distinct, notwithstanding the acquisition of said fee title and the
leasehold estate by Landlord or by Tenant or by a third party, by purchase or
otherwise.
45.07 If any Leasehold Mortgagee or its designee has entered into the
New Lease with Landlord in accordance with Section 45.03 hereof, such Leasehold
Mortgagee or its
166
designee shall succeed to the rights of Tenant, if any, in and to the security
deposit paid by Tenant to Landlord pursuant to Article 5 of this Lease. In any
such event, Tenant shall no longer have any rights to such security deposit, and
Landlord shall hold such security deposit for and on behalf of such Leasehold
Mortgagee or its designee.
45.08 With respect to Tenant's Property, Tenant hereby agrees that
Tenant shall be permitted to grant security interests therein only on condition
that the secured party shall remove of at all from the Premises, and repair any
damage to the Premises and/or the Building caused by such removal, those items
constituting Tenant's Property in which such secured party has an interest
within thirty (30) days after the giving of notice by certified mail, return
receipt requested, of the termination of this Lease or the dispossession of
Tenant from the Premises, and that if such secured party shall fail to remove
same from the Premises within such thirty (30) day period, same shall be deemed
abandoned and Landlord shall have the right, without liability to such secured
party, to dispose of same in any manner whatsoever but the secured party shall
have no obligation or liability to Landlord on account of its failure to remove
such Tenant's Property.
45.09 Landlord shall, without charge, at any time and from time to time
hereafter, but not more frequently than twice in any one-year period, within ten
(10) days after written request of Tenant to do so, certify by written
instrument duly executed and acknowledged to any Leasehold Mortgagee, or
proposed Leasehold Mortgagee: (A) as to whether this Lease has been supplemented
or amended, and if so, the substance and manner of such supplement or amendment;
(B) as to the validity and force and effect of this Lease, in accordance with
its tenor; (C) as to the existence of any default hereunder; (D) as to the
existence of any offsets, counterclaims or defenses hereto on the part of
Tenant; (E) as to the commencement and expiration dates of the term of this
Lease; and (F) as to any other matters as may be reasonably so requested. Any
such certificate may be relied upon by Tenant and any other person, firm or
corporation to whom the same may be exhibited or delivered, and the contents of
such certificate shall be binding on Landlord.
ARTICLE 46
Collateral Assignment of Subleases And Subrents
46.01 In order to secure the prompt and complete payment and
performance when due of all of Tenant's obligations under this Lease, Tenant
shall execute and deliver to Landlord a Collateral Assignment of Subleases and
Subrents in the form annexed hereto as Exhibit X-x, whereby Tenant assigns to
Landlord a lien and interest in all of the subleases and subrents in respect of
the Building, including both the Office Space and the Retail Space, whether now
or hereafter existing. Landlord is hereby authorized, at any time after the date
of
167
this Lease, to (i) complete the blank in Paragraph 14 of the Collateral
Assignment of Subleases and Subrents with such amount as Landlord may determine
in its sole discretion, and (ii) record the Collateral Assignment of Subleases
and Subrents. Tenant hereby represents and warrants that it has not executed any
prior assignment of the Subleases and Subrents, nor has it performed any act or
executed any instrument which might prevent Tenant from fulfilling any of the
terms of the Collateral Assignment or which might prevent Landlord from
enforcing its rights or remedies thereunder.
46.02 Tenant shall not grant or execute any other assignment of
subleases and subrents in respect of the Building, except that Tenant may
execute and deliver to a Leasehold Mortgagee an assignment, provided that the
Leasehold Mortgagee has complied fully with all the requirements of Article 45
of this Lease, including the execution of the Intercreditor Agreement in the
form of Exhibit R-2 or R-3, as the case may be.
46.03. Landlord shall be responsible for all mortgage recording taxes
and other costs to record or otherwise perfect the Collateral Assignment of
Subleases and Subrents and any related documents.
168
IN WITNESS WHEREOF, Landlord and Tenant have duly executed this Lease
as of the day and year first above written.
MASSACHUSETTS MUTUAL LIFE INSURANCE
COMPANY, Landlord
By: Cornerstone Real Estate Advisers,
Inc., its agent
By: /s/ Xxxxxx X. Xxxxxx
----------------------------------
Name: Xxxxxx X. Xxxxxx
Title: Managing Director
SFX ENTERTAINMENT, INC., Tenant
By:
----------------------------------
Name:
Title:
Tenant's Federal Identification Number:
----------------------------------------
IN WITNESS WHEREOF, Landlord and Tenant have duly executed this Lease
as of the day and year first above written.
MASSACHUSETTS MUTUAL LIFE INSURANCE
COMPANY, Landlord
By: Cornerstone Real Estate Advisers,
Inc., its agent
By:
----------------------------------
Name:
Title:
SFX ENTERTAINMENT, INC., Tenant
By: /s/ Xxxxxx F.X. Sillerman
----------------------------------
Name: Xxxxxx F.X. Sillerman
Title: Executive Chairman
Tenant's Federal Identification Number:
00-0000000
----------------------------------------
LANDLORD
State of Connecticut )
):ss
County of Hartford )
On the 25th day of February in the year 2000, before me, the undersigned, a
Notary Public in and for said state, personally appeared Xxxxxx X. Xxxxxx
personally known to me or proved to me on the basis or satisfactory evidence to
be the person(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
person(s), or the entity upon behalf of which the person(s) acted, executed the
instrument.
/s/ Xxxx X. Xxxxx
----------------------------------------
Notary Public
XXXX X. XXXXX
My Commission Expires:
September 30, 0000
XXXXXXXXX XXXXXX
Xxxxx xx Xxx Xxxx )
):ss
County of New York )
On the ___ day of _______ in the year 2000, before me, the undersigned, a Notary
Public in and for said state, personally appeared _______________________
personally known to me or proved to me on the basis or satisfactory evidence to
be the person(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
person(s), or the entity upon behalf of which the person(s) acted, executed the
instrument.
----------------------------------------
Notary Public
LANDLORD
State of Connecticut )
):ss
County of Hartford )
On the ___ day of _______ in the year 2000, before me, the undersigned, a Notary
Public in and for said state, personally appeared _______________________
personally known to me or proved to me on the basis or satisfactory evidence to
be the person(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
person(s), or the entity upon behalf of which the person(s) acted, executed the
instrument.
----------------------------------------
Notary Public
CORPORATE TENANT
State of New York )
):ss
County of New York )
On the 1st day of March in the year 2000, before me, the undersigned, a Notary
Public in and for said state, personally appeared Xxxxxx F.X. Sillerman
personally known to me or proved to me on the basis or satisfactory evidence to
be the person(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
person(s), or the entity upon behalf of which the person(s) acted, executed the
instrument.
/s/ May Xxxx Xxx
----------------------------------------
Notary Public
MAY XXXX XXX
Notary Public - State of New York
NO. 01LE6029297
Qualified in New York County
My Commission Expires Aug. 9, 2001
LEASE AMENDMENT
LEASE AMENDMENT (herein called this "Amendment"), dated October 22,
2002, between MASSACHUSETTS MUTUAL LIFE INSURANCE COMPANY, a Massachusetts
corporation, having an office at c/o Cornerstone Real Estate Advisers, Inc., Xxx
Xxxxxxxxx Xxxxx, Xxxxx 0000, Xxxxxxxx, Xxxxxxxxxxx 00000-0000 (herein called
"Landlord") and SFX ENTERTAINMENT, INC. (d/b/a Clear Channel Entertainment), a
Delaware corporation, having an office at 000 Xxxx 00xx Xxxxxx, Xxx Xxxx, Xxx
Xxxx 00000 (herein called "Tenant").
W I T N E S S E T H :
WHEREAS:
A. Landlord and Tenant have entered into that certain Lease dated as of
March 13, 2000, as amended by letter agreement dated as of April 14, 2000 (said
Lease, as the same has been and may hereafter be amended, the "Lease"), covering
the land and building (known as the Xxxxxxx Building) located at 000 Xxxx 00xx
Xxxxxx, Xxx Xxxx, Xxx Xxxx, as more particularly described in the Lease.
B. Landlord and Tenant desire to amend the Lease for the purpose of
permitting Tenant to change the use of the third (3rd) floor of the Building
from retail to office use and as otherwise set forth herein.
NOW, THEREFORE, for good and valuable consideration the receipt and
sufficiency of which is hereby acknowledged by the parties, Landlord and Tenant
hereby agree as follows:
1. The first sentence of Section 2.02(e) of the Lease is hereby
deleted in its entirety and the following inserted in lieu thereof:
"(e) Tenant shall have the right, at Tenant's sole cost and
expense, to change the use of any of the fifth (5th) floor of
the Building, both the fourth (4th) and fifth (5th) floors of
the Building; or all of the third (3rd), fourth (4th) and
fifth (5th) floors of the Building from the use(s) permitted
under this Lease for the Retail Premises to the uses permitted
under this Lease for Office Premises; provided, at Tenant's
option, upon not less than ten (10) days prior written notice
to Landlord and further provided that Tenant otherwise
complies with the other provisions of this Section 2.02(e) and
the other applicable provisions of this Lease, including,
without limitation the provisions of Article 11 and the
provisions of Section 12.01 of the Lease with respect to
"Non-Standard Items", Tenant may subsequently convert back the
use of the third (3rd) floor to a use or uses permitted under
this Lease for Retail Premises."
2. The fourth sentence of Section 1.02 of the Lease is hereby deleted
in its entirety and the following inserted in lieu thereof:
"In the event Tenant converts the use of (x) the fifth (5th)
floor, (y) both the fourth (4th) and fifth (5th) floors, or
(z) all of the third (3rd), fourth (4th) and fifth (5th)
floors of the Building from retail use to office use pursuant
to Section 2.02(e) hereof, from and after any such conversion
the floor(s) so converted shall be deemed "Office Floor(s)"
and part of the "Office Premises" for purposes of this Lease;
provided, however, in the event that Tenant shall subsequently
convert back the use of the third (3rd) floor to a use or uses
permitted under this Lease for Retail Premises in accordance
with the last phrase of the first sentence of section 2.02(e),
from and after such subsequent conversion, the third (3rd)
floor shall be deemed "Retail Floor" and part of the "Retail
Premises" for purposes of this Lease."
2
3. All cross-references in the Lease to Section 2.02(d) of the Lease
are hereby corrected to refer to Section 2.02(e) of the Lease. The
cross-reference in Section 7.12(a)(ii)(E) of the Lease to Section 2.02(c) of the
Lease is hereby corrected to refer to Section 2.02(d) of the Lease.
4. In addition to and not in limitation to any other reimbursement
obligations owed by Landlord to Tenant under the terms and provisions of the
Lease, upon receipt of reasonable proof of payment which may include (but are
not limited to) receipted contractor, subcontractor and/or architect or
engineer's invoices or invoices coupled with cancelled checks, Landlord
covenants to pay Tenant (or, at Tenant's direction, directly to Tenant's
subtenant, XxXxxxxx'x Corporation) the sum of $32,000 for certain work with
respect to asbestos abatement, relocation of a gas vent, and installation of
double-door entrance completed within the Retail Premises.
5. Except as modified by this Amendment, the Lease and all of the
covenants, agreements, terms and conditions thereof shall remain in full force
and effect and are hereby in all respects ratified and confirmed. Nothing
contained in this Amendment nor the execution and delivery of this document by
the parties hereto shall be deemed a waiver of the respective rights and
remedies of the parties hereto; and shall not be deemed a release of the
respective duties and obligations of the parties hereto under the terms and
provisions of the Lease, at law and/or in equity, all of which are expressly
reserved and maintained without abrogation.
6. This Amendment may not be changed orally but only by an agreement in
writing signed by the party against which enforcement of any waiver, change,
modification or discharge is sought.
7. The covenants; agreements, terms, provisions and conditions
contained in this Amendment shall be binding upon and inure to the benefit of
the parties hereto and their respective successors and, except as otherwise
provided in the Lease, their respective assigns.
8. This Amendment may be executed in one or more counterparts, which
when taken together shall constitute one original with the same force and effect
as if all the parties hereto had executed and delivered one counterpart
original.
3
IN WITNESS WHEREOF, Landlord and Tenant have executed this Amendment as
of the date first above written.
MASSACHUSETTS MUTUAL LIFE INSURANCE
COMPANY, Landlord
By: Cornerstone Real Estate Advisers,
Inc., its agent
By: /s/ Xxxx X. Xxxxx
----------------------------------
Name: Xxxx X. Xxxxx
Title: Vice President
SFX ENTERTAINMENT, INC., (d/b/a Clear
Channel Entertainment), Tenant
By: /s/ Xxxxx X. Xxxxxxx
----------------------------------
Name: Xxxxx X. Xxxxxxx
Title: Senior Vice President
The undersigned, CLEAR CHANNEL COMMUNICATIONS, INC., has executed this Amendment
for the purpose of acknowledging and confirming that its Guaranty of Lease dated
September 15, 2000, continues to apply to the Lease as modified by this
Amendment.
CLEAR CHANNEL COMMUNICATIONS, INC.
By: /s/ Xxxxxxx Xxxxx
----------------------------------
Name: Xxxxxxx Xxxxx
Title: Senior Vice President
4
