THIS INDENTURE OF LEASE made the 15th day of October, 2000, by and between
INDUSTRIAL & RESEARCH ASSOCIATES CO., a co-partnership, with offices at 0000
Xxxxxxx Xxxxxxxx, Xxxxxxxx, Xxx Xxxx 00000, hereinafter referred to as the
"LANDLORD" and INTELLICHECK, INC., with offices at 000 Xxxx Xxxxxx, Xxxxxxxxxx,
Xxx Xxxx 00000, hereinafter referred to as the "TENANT".
W I T N E S S E T H
WHEREAS, the LANDLORD is the owner in fee of the premises hereinafter
demised
NOW, THEREFORE, LANDLORD and TENANT covenant and agree as follows:
ARTICLE I
DEMISE
Section 1.1 The LANDLORD, for and in consideration of the rents, covenants
and agreements, hereinafter reserved and contained herein, hereby leases and
TENANT does hereby take and hire, upon and subject to the covenants and
conditions hereinafter expressed which the TENANT agrees to keep and perform,
the premises shown on the floor plan annexed hereto as Exhibit "A", hereinafter
called the "Demised Premises" consisting of 9,744 square feet rentable in the
building as shown on the Plan annexed hereto and marked Exhibit "B", situated at
000 Xxxxxxxxx Xxxx Xxxx, Xxxxxxxx, Xxx Xxxx 00000, together with the right to
use, in common with other tenants of the LANDLORD in this and other buildings,
the parking area shown on Exhibit "B" (hereinafter called "parking area") for
the parking of automobiles of employees, customers, invitees or licensees of the
TENANT and other tenants of the LANDLORD. TENANT shall be guaranteed thirty (30)
car parking with seven reserved spaces as noted on the plan attached.
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ARTICLE II
TERM
Section 2.1 The basic term of this Lease (hereinafter referred to as the
"Term") shall commence upon the date the LANDLORD gives notice to the TENANT
that the LANDLORD has substantially completed the work set forth on the Work
Letter attached hereto as Exhibit "C". The term "substantially completed" as
used herein shall be deemed to mean so complete as to allow the TENANT to enter
the Demised Premises and conduct its normal business operations therein even
though there may be minor items of decoration or construction to be completed.
At the time of the commencement of the Lease the LANDLORD shall have received a
temporary or permanent Certificate of Occupancy for the Demised Premises (unless
any work to be done therein, by the TENANT, shall prevent the issuance of either
such Certificate of Occupancy) and the air conditioning, heating, plumbing and
electrical systems in the Demised Premises shall be in working order and the
said Demised Premises shall be free of debris.
Section 2.2 The term of this Lease shall be for ten (10) years and two (2)
months.
The term "Lease year" as used herein or "year" as used herein, shall mean
a twelve (12) month period. The first Lease year shall commence on the date of
the term hereof, but if such date of commencement shall be a date other than the
first day of a month, the first Lease year shall commence on the first day of
the month following the month in which the term of the Lease commences. Each
succeeding Lease year during the term hereof shall commence on the anniversary
date of the first Lease year.
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Section 2.3 Immediately following the determination of the commencement
date of the term of this Lease, the LANDLORD and the TENANT, at the request of
either party, shall execute an agreement in recordable form, setting forth both
the dates of the commencement of the term of this Lease and the date of the
termination hereof.
Section 2.4 The parties expect that the term of this Lease will commence
no sooner than sixty (60) days after the execution of this Lease with a minimum
of five (5) days prior written notice of substantial completion of the Demised
Premises. In the event, however, that the LANDLORD is unable to substantially
complete the work set forth on Exhibit "C" by reason of strikes, inability to
obtain materials, governmental regulations, acts of God or other matters beyond
LANDLORD'S control then, and in that event, the provisions of Section "2.1"
shall control the commencement of the term hereof.
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ARTICLE III
BASIC RENT -- ADDITIONAL RENT
Section 3.1 Commencing two (2) months after the Lease Commencement Date,
the TENANT shall pay to the LANDLORD an Annual Basic Rent to INDUSTRIAL &
RESEARCH ASSOCIATES CO. at X.X. Xxx 0000, Xxxxxxxxxx, Xxx Xxxx 00000-0000, in
equal monthly installments in advance of or on the first day of each month
without notice and demand and without abatement, deduction or set-off of any
amount whatsoever based upon the following schedule:
TERM ANNUAL RENT MONTHLY RENT
---- ----------- ------------
Lease Year 1 $209,496.00 $17,458.00
Lease Year 2 $217,875.84 $18,156.32
Lease Year 3 $226,548.00 $18,879.00
Lease Year 4 $235,609.92 $19,634.16
Lease Year 5 $245,061.60 $20,421.80
Lease Year 6 $254,903.04 $21,241.92
Lease Year 7 $265,134.24 $22,094.52
Lease Year 8 $275,755.20 $22,979.60
Lease Year 9 $286,765.92 $23,897.16
Lease Year 10 $298,263.84 $24,855.32
The fractional rent, if any, from the rent commencement date (as above provided)
to the date of the first day of the following month shall be paid by the TENANT
to the LANDLORD within five (5) days after the rent commencement date. The
LANDLORD acknowledges receipt of $17,458.00 representing the rent for the first
full month for which rent is due hereunder.
Section 3.2 As additional rent during each and every year during the term
hereof and any renewals the TENANT shall pay to the LANDLORD its proportionate
share of any increase in real estate taxes over the 2000/2001 School Tax and the
2000 Town Tax, provided that any such tax increase shall not be caused by
another Tenant of the building.
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A. TENANT'S proportionate share of any such increase shall be determined
by multiplying any such increase by a fraction, the numerator of which shall be
the total gross rentable area of the Demised Premises (i.e., 9,744 square feet)
and the denominator of which shall be the total gross rentable area of the
building of which the Demised Premises form a part (i.e., 26,663 square feet),
i.e., 36.55%.
B. TENANT shall similarly pay its proportionate share as determined in
sub-paragraph "A" above of any ad valorem assessments, or impositions against
the real property of which the Demised Premises form a part and its
proportionate share of any taxes which shall be imposed in lieu of any ad
valorem real property tax as the same is presently considered, except that
TENANT shall not be obligated to pay any portion of any assessment or
impositions (whether payable in installments or otherwise) which have become a
lien prior to the commencement of the term of this Lease. In the event that
there shall be any general or special assessments or impositions against the
said real property which the TENANT is obligated to pay a proportionate share,
the LANDLORD agrees that if the said assessments or impositions may be paid in
installments that the LANDLORD will elect to pay the same in installments and
the TENANT shall only be responsible to pay its proportionate share of those
installments which cover the period of the term of the Lease.
LANDLORD represents that to the best of LANDLORD'S knowledge, there are
currently no special assessments, impositions or taxes pending with reference to
the property.
Section 3.3 In the event that LANDLORD or any major tenant of the building
should contest any taxes or assessments levied against the building, the TENANT
agrees to cooperate but is not obligated to contribute to any expenses incurred
by the LANDLORD in any such proceeding or action. In the event that there shall
be any refunds of taxes by reason of any such action or proceeding, the TENANT
shall be entitled to receive back its proportionate share of the net refund
(after deducting therefrom the pro-rata cost of the action or proceeding
including, without limitation, fees for experts, court costs, attorneys, etc.).
In no event shall TENANT be entitled to any refund in excess of the amount of
taxes paid by the TENANT for the year for which such refund was made.
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Section 3.4 Rent and Additional Rent shall be payable in lawful money of
the United States to the LANDLORD at X.X. Xxx 0000, Xxxxxxxxxx, Xxx Xxxx
00000-0000, or at such other place as the LANDLORD may from time to time
designate, in advance, without notice, demand, offset or deduction except as
specifically set forth herein. In the event any payment of Basic Rent or
Additional Rent shall not be made to LANDLORD within ten days after the due date
thereof, there shall be added to the amount a sum equal to five percent of the
unpaid items to help defray LANDLORD'S additional costs for additional
bookkeeping and other costs in connection therewith.
Section 3.5 Any payment to LANDLORD provided for herein, for which no
specific time period is set forth within which it is to be paid, must be paid
within ten (10) days of receipt of notice that same is due.
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ARTICLE IV
UTILITIES AND SERVICES
Section 4.1 TENANT shall contract with the local utility company for all
utilities (gas and electric) used and consumed within the Demised Premises,
including the utilities used in conjunction with TENANT'S HVAC system. TENANT
shall deposit any monies required with the utility company.
Section 4.2 LANDLORD shall supply, at LANDLORD'S own cost and expense,
water to the building of which the Demised Premises form a part for normal
office building consumption.
Section 4.3 The LANDLORD covenants to provide and pay for cleaning
services by LANDLORD'S cleaner as per the Cleaning Specifications attached
hereto and made a part hereof as Exhibit "D".
In the event the TENANT desires to do their own cleaning, TENANT shall
give the LANDLORD thirty (30) days prior written notice of same and LANDLORD
shall provide a credit in the amount of $609.00 per month for the remaining
Lease term.
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ARTICLE V
LANDLORD'S WORK, REPAIR AND MAINTENANCE
Section 5.1 The LANDLORD agrees, at its own cost and expense, to do the
work relating to the Demised Premises in accordance with the Work Letter
attached hereto, as Exhibit "C".
Section 5.2 TENANT may have its workmen commence work in the Demised
Premises prior to the substantial completion of LANDLORD'S work, provided that
such workmen do not, in any manner, interfere with or impede LANDLORD'S workers.
In the event that TENANT'S workers shall interfere with or impede LANDLORD'S
workers, then upon notice from LANDLORD, TENANT will immediately remove its
workers from the Demised Premises. TENANT'S entry into the Demised Premises for
the purpose of making TENANT'S installations shall not be deemed a waiver of any
of the TENANT'S rights under the Lease, nor shall the same be deemed an
acceptance of the work to be done by the LANDLORD hereunder.
Section 5.3 The TENANT covenants throughout the term of this Lease, at the
TENANT'S sole cost and expense, to take good care of the interior of the Demised
Premises and keep the same in good order and condition and to make all repairs
therein except as provided in Section "5.4" hereof.
Section 5.4 The LANDLORD covenants throughout the term of this Lease, at
the LANDLORD'S sole cost and expense, to make all structural repairs to the
building in which the Demised Premises are located and shall also maintain and
keep in good repair the building's sanitary, electrical, heating and other
systems servicing or located, in or passing through the Demised Premises, other
than
(i) To any systems, facilities and equipment installed on behalf of
the TENANT; and
(ii) To any of the improvements to the interior of the Demised
Premises undertaken and completed by the TENANT; and
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(iii) Any repairs which are necessitated by any act or omission of
the TENANT, its agents, servants, employees or invitees, which repairs
TENANT shall make at its own cost and expense. In the event the LANDLORD
makes any repairs which are necessitated by any act or omission of the
TENANT, its affiliates, employees or invitees, LANDLORD shall submit a
copy of the xxxx for same and shall charge the TENANT an additional ten
percent (10%) overhead profit along with such xxxx.
Section 5.5 Except as expressly provided otherwise in this Lease, there
shall be no allowance to the TENANT or diminution of rent and no liability on
the part of the LANDLORD by reason of inconvenience, annoyance or injury to
business arising from the making of any repairs, alterations, additions or
improvements in or to any portion of the building, on the Demised Premises, in
the parking area, or in and to the fixtures, appurtenances and equipment
thereof. The LANDLORD agrees to do any work to be done by it in such a manner as
not to unreasonably interfere with the TENANT'S use of the Demised Premises.
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ARTICLE VI
CHANGES AND ALTERATIONS -- SURRENDER OF DEMISED PREMISES
Section 6.1 The TENANT shall have the right, at any time and from time to
time, during the term of this Lease to make such nonstructural changes and
alterations to the Demised Premises as the TENANT shall deem necessary or
desirable. However, all changes and alterations must be made with the written
consent of the LANDLORD and any alterations affecting HVAC, plumbing and
electrical work, including lighting, must be done by the LANDLORD at TENANT'S
sole cost and expense.
Section 6.2 The TENANT agrees not to place any signs on the roof or on or
about the inside or outside of the building in which the Demised Premises are
situated, except for signs inside of the Demised Premises which may not be seen
from the outside, except as noted in Article XXIX of this Lease.
Section 6.3 All improvements and alterations made or installed by or on
behalf of the TENANT, shall immediately, upon completion of installation
thereof, be and become the property of the LANDLORD without payment therefor by
the LANDLORD.
Section 6.4 The TENANT shall, upon the expiration or earlier termination
of this Lease, surrender to the LANDLORD the Demised Premises, together with all
alterations and replacement thereto, in good order and condition, except for
reasonable wear and tear or damage by fire or casualty.
If the TENANT shall make any alterations or changes or additions to the
Demised Premises, after the commencement of the term of this Lease, and LANDLORD
shall desire the same to be removed upon the expiration of the term hereof, then
upon LANDLORD'S giving notice to the TENANT of its desire to have the same
removed, the TENANT will remove the same prior to the expiration of the term
hereof at TENANT'S sole cost and expense and TENANT will, at its own cost and
expense, restore the premises to the condition which they were in just prior to
the commencement of the term hereof, normal wear and tear and damage by fire
excepted.
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Section 6.5 In connection with any alterations to the Demised Premises
done by TENANT including decorating, prior to any work being commenced, TENANT
shall supply to LANDLORD: (i) liability insurance from the Contractor doing the
work in an amount not less than Three Million Dollars, naming LANDLORD as an
additional insured; (ii) evidence that all workers doing work in the Demised
Premises are covered by Workers Compensation Insurance; (iii) an agreement from
TENANT'S contractor to remove all debris from the premises shown on Exhibit "B"
after 6:00 P.M. at the end of each day's work. In the event TENANT'S contractor
shall fail to remove debris on a daily basis, as hereinabove provided, LANDLORD
may order said contractors off the premises and refuse them access to the
Building thereafter.
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ARTICLE VII
COMPLIANCE WITH ORDERS, ORDINANCES, ETC.
Section 7.1 The TENANT covenants throughout the term of this Lease and any
renewals hereof, at the TENANT'S sole cost and expense, to comply with all laws
and ordinances and the orders and requirements of all federal, state and
municipal governments and appropriate departments, commissions, boards and
officers thereof, which may be applicable to the TENANT'S use or occupancy of
the Demised Premises.
Section 7.2 The TENANT shall have the right to contest by appropriate
legal proceedings, in the name of the TENANT or the LANDLORD or both, but
without cost or expense to the LANDLORD, the validity of any law, ordinance,
order or requirement of the nature referred to in Section "7.1" hereof. Provided
such noncompliance does not subject the LANDLORD to any criminal liability for
failure so to comply therewith, the TENANT may postpone compliance therewith
until the final determination of any proceedings, provided that all such
proceedings shall be prosecuted with all due diligence and dispatch, and if any
lien or charge is incurred by reason of noncompliance, the TENANT may
nevertheless make the contest aforesaid and delay compliance as aforesaid,
provided that the TENANT indemnifies the LANDLORD against any loss or injury by
reason of such noncompliance or delay therein.
Section 7.3 LANDLORD covenants and agrees that at the time of the
commencement of the term of this Lease, the Demised Premises shall comply with
all laws, ordinances and regulations applicable thereto.
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ARTICLE VIII
MECHANIC'S LIENS
Section 8.1 The TENANT covenants not to suffer or permit any mechanic's
liens to be filed against the fee interest of the LANDLORD nor against TENANT'S
Leasehold interest in the Demised Premises by reason of work, labor, services or
materials supplied or claimed to have been supplied to the TENANT or any
contractor, subcontractor or any other party or person acting at the request of
the TENANT, or anyone holding the Demised Premises or any part thereof through
or under the TENANT. TENANT agrees that in the event any mechanic's lien shall
be filed against the fee interest of the LANDLORD or against the TENANT'S
Leasehold interest the TENANT shall, within thirty (30) days after receiving
notice of the filing thereof, cause the same to be discharged of record by
payment , deposit, bond or order of a court of competent jurisdiction or
otherwise.
If TENANT shall fail to cause such lien to be discharged or bonded with
the period aforesaid, then, in addition to any other right or remedy, LANDLORD
may, but shall not be obligated to, discharge the same by paying the amount
claimed to be due, by procuring the discharge of such lien by deposit by bonding
proceedings, and in any such event, LANDLORD shall be entitled, if LANDLORD so
elects, to compel the prosecution of any action for the foreclosure of such lien
by the lienor and to pay the amount of the judgment in favor of the lienor with
interest, costs and allowances. Any amount so paid by LANDLORD and all
reasonable costs and expenses incurred by LANDLORD or the fee owner in
connection therewith, including, but not limited to premiums on any bonds filed
and attorneys' fees, shall constitute Additional Rental payable by TENANT to
LANDLORD within ten days of demand therefor.
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ARTICLE IX
INSPECTION OF DEMISED PREMISES BY LANDLORD
Section 9.1 The TENANT agrees to permit the LANDLORD and the authorized
representatives of the LANDLORD to enter the Demised Premises at all reasonable
times during TENANT'S usual business hours for the purpose of (a) inspecting the
same, and (b) making any necessary repairs to the Demised Premises.
Section 9.2 The LANDLORD is hereby given the right, during TENANT'S usual
business hours, to enter the Demised Premises to exhibit the same for the
purpose of sale or mortgage and, during the last six (6) months of the initial
term or at anytime if the TENANT defaults in any of the terms, covenants and
conditions of this Lease, to exhibit the same to prospective tenants for the
purposes of renting.
Section 9.3 With regard to Sections 9.1 and 9.2, LANDLORD shall endeavor
to give reasonable notice to TENANT of LANDLORD'S intention to inspect the
premises or to make repairs.
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ARTICLE X
RIGHT TO PERFORM COVENANTS
Section 10.1 The TENANT covenants and agrees that if the TENANT shall, at
any time, fail to make any payment or perform any other act on its part to be
made or performed under this Lease, the LANDLORD, after the expiration of any
time limitation set forth in this Lease (except in cases of emergency) may, but
shall not be obligated to, make such payment or perform such other act to the
extent the LANDLORD may deem desirable, and in connection therewith to pay
expenses and employ counsel. All sums so paid by the LANDLORD and all expenses
in connection therewith shall be deemed Additional Rent hereunder and be payable
to the LANDLORD on the first day of the next month and the LANDLORD shall have
the same rights and remedies for the nonpayment thereof as in the case of
default in the payment of the basic rent reserved hereunder.
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ARTICLE XI
DAMAGE OR DESTRUCTION
Section 11.1 A. If the Demised Premises or any part thereof shall be
damaged by fire or other casualty, TENANT shall give immediate notice thereof to
LANDLORD and this Lease shall continue in full force and effect except as
hereinafter set forth.
B. If the Demised Premises are partially damaged or rendered
partially unusable by fire or other casualty, the damages thereto shall be
repaired by and at the expense of LANDLORD to the extent that said damages
include those installations originally installed by LANDLORD.
C. If the Demised Premises are totally damaged or rendered wholly
unusable by fire or other casualty, then the LANDLORD shall have the right
to elect not to restore the same as hereinafter provided.
D. If the Demised Premises are rendered wholly unusable or (whether
or not the Demised Premises are damaged in whole or in part) if the
building shall be so damaged that LANDLORD shall decide to demolish it or
not to rebuild it, then, in any of such events, LANDLORD may elect to
terminate this Lease or rebuild by written notice to TENANT given within
ninety (90) days after such fire or casualty specifying a date for the
expiration of the Lease or rebuilding, which date shall not be more than
sixty (60) days after the giving of such notice. Upon the date specified
in a notice of termination, the term of this Lease shall expire as fully
and completely as if such date were the date set forth above for the
termination of this Lease and TENANT shall forthwith quit, surrender and
vacate the premises without prejudice however, to LANDLORD'S rights and
remedies against TENANT under the Lease provisions in effect prior to such
termination, and any rent owing shall be paid up to such date and any
payments of rent made by TENANT which were on account of any period
subsequent to such date shall be returned to TENANT. Unless LANDLORD
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shall serve a termination notice as provided for herein, LANDLORD shall
make the repairs and restorations under the conditions of "B" and "C"
hereof, with all reasonable expedition subject to delays due to adjustment
of insurance claims, labor troubles and causes beyond LANDLORD'S control.
E. Nothing contained hereinabove shall relieve TENANT from liability
that may exist as a result of damage from fire or other casualty.
Notwithstanding the foregoing, each party shall look first to any
insurance in its favor before making any claim against the other party for
recovery for loss or damage resulting from fire or other casualty, and to
the extent that such insurance is in force and collectable to the extent
permitted by law, LANDLORD and TENANT each hereby releases and waives all
right of recovery against the other or any one claiming through or under
each of them by way of subrogation or otherwise. LANDLORD and TENANT'S
insurance policies shall contain a clause providing that such a release or
waiver shall not invalidate the insurance and also, provided that such
policy can be obtained without additional premiums. In the event that
there are additional premiums for such waiver of subrogation, the party in
whose favor such waiver is intended shall have the option to either pay
the additional premium or waive the condition that the other's policy
contain the same. TENANT acknowledges that LANDLORD will not carry
insurance on TENANT'S furniture and/or furnishings or any fixtures or
equipment, improvements, or appurtenances removable by TENANT and agrees
that LANDLORD will not be obligated to repair any damage thereto or
replace the same.
F. TENANT hereby waives the provisions of Section 227 of the Real
Property Law and agrees that the provisions of this article shall govern
and control in lieu thereof.
Section 11.2 The TENANT shall not knowingly do or permit to be done any
act or thing upon the Demised Premises, which will invalidate or be in conflict
with fire insurance policies covering the building of which Demised Premises
form a part, and fixtures and property therein. The TENANT shall, at its
expense, comply with all rules, orders, regulations or requirements of the New
York Board of Fire Underwriters,
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or any other similar body, which may be applicable to the TENANT'S use and
occupancy of the Demised Premises, provided that the necessity for such
compliance results from the use and occupancy of the Demised Premises by the
TENANT, and shall not do, or permit anything to be done, in or upon the Demised
Premises or bring or keep anything therein, or use the Demised Premises in a
manner which shall increase the rate of fire insurance on the building of which
the Demised Premises form a part, or on the property located therein, over that
in effect when the Lease commenced, unless the TENANT shall reimburse the
LANDLORD, as additional rent hereunder, for that part of all insurance premiums
thereafter paid by the LANDLORD, which shall have been charged because of such
failure or use by the TENANT, and shall make such reimbursement upon the first
day of the month following receipt of notice of such outlay by the LANDLORD and
evidence of the payment thereof.
Section 11.3 Notwithstanding anything to the contrary contained in this
Lease, during any period after damage or destruction and until the premises have
been restored, the TENANT shall be entitled to an abatement of rent and
additional rent for the unusable portion of the Demised Premises, on a square
foot basis.
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ARTICLE XII
CONDEMNATION
Section 12.1 If the whole of the Demised Premises shall be taken for any
public or quasi-public use by any lawful power or authority by exercise of the
right of condemnation or eminent domain, or by agreement between LANDLORD and
those having the authority to exercise such right (hereinafter called "Taking"),
the term of this Lease and all rights of TENANT hereunder, except as hereinafter
provided, shall cease and expire as of the date of vesting of title as a result
of the Taking and the rent or additional rent paid for a period after such date
shall be refunded to TENANT upon demand.
Section 12.2 In the event of a Taking of less than the whole of the
Demised Premises, or the whole or part of the parking area, this Lease shall
cease and expire in respect of the portion of the Demised Premises and/or the
parking area taken upon vesting of title as a result of the Taking, and, if the
Taking results in the portion of the Demised Premises remaining after the Taking
being inadequate, in the judgment of TENANT, for the efficient, economical
operation of the TENANT'S business conducted at such time in the Demised
Premises, TENANT may elect to terminate this Lease by giving notice to LANDLORD
of such election not more than forty-five (45) days after the actual Taking by
the condemning authority, stating the date of termination, which date of
termination shall be not more than thirty (30) days after the date on which such
notice to LANDLORD is given, and upon the date specified in such notice to
LANDLORD, this Lease and the term hereof shall cease and expire. If TENANT does
not elect to terminate this Lease aforesaid:
(i) The new rent payable under this Lease shall be the product of
the basic rent payable under this Lease multiplied by a fraction, the
numerator of which is the net rentable area of the Demised Premises
remaining after the Taking, and the denominator of which is the net
rentable area of the Demised Premises immediately preceding the Taking,
and
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(ii) The net award for the Taking shall be paid to and first used by
LANDLORD, subject to the rights of mortgagee, to restore the portion of
the Demised Premises and the building remaining after the Taking to
substantially the same condition and tenantability (hereinafter called the
"Pre-Taking Condition") as existed immediately preceding the date of the
Taking.
Section 12.3 In the event of a Taking of less than the whole of the
Demised Premises which occurs during the period of two (2) years next preceding
the date of expiration of the term of this Lease, LANDLORD or TENANT may elect
to terminate this Lease by giving notice to the other party to this Lease of
such election, not more than forty-five (45) days after the actual Taking by the
condemning authority, stating the date of termination, which date of termination
shall not be more than thirty (30) days after the date on which such notice of
termination is given, and upon the date specified in such notice, this Lease and
the term hereof shall cease and expire all rent and additional rent paid under
this Lease for a period after such date of termination shall be refunded to
TENANT upon demand. On or before such date of termination, TENANT shall vacate
the Demised Premises, and any of TENANT'S property remaining in the Demised
Premises subsequent to such date of termination shall be deemed abandoned by
TENANT and shall become the property of LANDLORD.
Section 12.4 In the event of a Taking of the Demised Premises or any part
thereof, and whether or not this Lease is terminated, TENANT shall have no claim
against LANDLORD or the condemning authority for the value of the unexpired term
of this Lease, but:
(i) TENANT may interpose and prosecute in any proceedings in respect
of the Taking, independent of any claim of LANDLORD, a claim for the
reasonable value of TENANT'S fixtures and
(ii) A claim for TENANT'S moving expenses.
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ARTICLE XIII
BANKRUPTCY OR OTHER DEFAULT
Section 13.1 A. Events of Bankruptcy, The following shall be Events of
Bankruptcy under this Lease:
(i) TENANT'S becoming insolvent, as the term is defined in Title 11
of the United States Code, entitled Bankruptcy, 11 U.S.C. Sec. 101 et seq.
(The "Bankruptcy Code") or under the insolvency laws of New York State;
(ii) The appointment of a Receiver or Custodian for any or all of
TENANT'S property or assets;
(iii) The filing of a voluntary petition under the provisions of the
Bankruptcy Code or Insolvency Laws;
(iv) The filing of an involuntary petition against TENANT as the
subject debtor under the Bankruptcy Code or Insolvency Laws, which is
either not dismissed within sixty days of filing, or results in the
issuance of an order for relief against the debtor, whichever is later;
or,
(v) TENANT'S making or consenting to an assignment for the benefit
of creditors of a common law composition of creditors.
B. Landlord's Remedies
(i) Termination of Lease. Upon the occurrence of an Event of
Bankruptcy, LANDLORD shall have the right to terminate this Lease by
giving thirty days prior written notice to TENANT, provided, however, that
this Section "13.1 (B) (i)" shall have no effect while a case in which
TENANT is the subject debtor under the Bankruptcy Code is pending, unless
TENANT or its Trustee in Bankruptcy is unable to comply with the
provisions of Sections "13.1 (B) (v)" and "13.1 (B) (vi)" below. If TENANT
or its Trustee is unable to comply with Sections "13.1 (B) (v)" and "13.1
21
(B) (vi)" below, this Lease shall automatically cease and terminate, and
TENANT shall be immediately obligated to quit the premises upon the giving
of notice pursuant to this Section "13.1 (B) (i)". Any other notice to
quit, or notice of LANDLORD'S intention to re-enter is hereby expressly
waived. If LANDLORD elects to terminate this Lease, everything contained
in this Lease on the part of LANDLORD to be done and performed shall cease
without prejudice, subject, however to the right of LANDLORD to recover
from TENANT all rent and any other sums accrued up to the time of
termination or recovery of possession by LANDLORD, whichever is later, and
any other monetary damages or loss of reserved rent sustained by LANDLORD.
(ii) Suit for Possession. Upon termination of this Lease, pursuant
to Section "13.1 (B) (i)", LANDLORD may proceed to recover possession
under and by virtue of the provisions of the laws of the State of New
York, or by such other proceedings, including re-entry and possession, as
may be applicable.
(iii) Reletting of Premises. Upon termination of this Lease,
pursuant to Section "13.1 (B) (i)", the premises may be relet by LANDLORD
for such rent and upon such terms as are not unreasonable under the
circumstances, and if the full rental reserved under this Lease (and any
of the costs, expenses, or damages indicated below) shall not be realized
by LANDLORD, TENANT shall be liable for all damages sustained by LANDLORD,
including, without limitation, deficiency in rent, reasonable attorneys'
fees, brokerage fees, and expenses of placing the premises in the first
class rentable condition. LANDLORD, in putting the premises in good order
or preparing the same for re-rental may, at LANDLORD'S option, make such
alterations, repairs, or replacements in the premises as LANDLORD, in
LANDLORD'S sole judgment, considers advisable and necessary for the
purpose of reletting the premises, and the
22
making of such alterations, repairs, or replacements shall not operate or
be construed to release TENANT from liability hereunder as aforesaid.
LANDLORD shall, in no event, be liable in any way whatsoever for failure
to relet the premises, or in the event that the premises are relet, for
failure to collect the rent thereof under such reletting, and in no event
shall TENANT be entitled to receive any excess, if any, of such net rent
collected over the sums payable by TENANT to LANDLORD hereunder.
(iv) Monetary Damages. Any damage or loss of rent sustained by
LANDLORD as a result of an Event of Bankruptcy may be recovered by
LANDLORD, at LANDLORD'S option, at the time of the reletting, or in
separate actions, from time to time, as said damage shall have been made
more easily ascertainable by successive relettings, or in a single
proceeding deferred until the expiration of the term of this Lease (in
which event TENANT hereby agrees that the cause of action shall not be
deemed to have accrued until the date of expiration of said term) or in a
single proceeding prior to either the time of reletting or the expiration
of the term of this Lease, in which event TENANT agrees to pay LANDLORD
the difference between the present value of the rent reserved under this
Lease on the date of breach, discounted at eight percent per annum, and
the fair market rental value of the Demised Premises on the date of
breach. In the event TENANT becomes the subject debtor in a case under the
Bankruptcy Code the provisions of this Section "13.1 (B) (iv)" may be
limited by the limitations of damage provisions of the Bankruptcy Code.
(v) Assumption or Assignment by Trustee. In the event TENANT becomes
the subject debtor in a case pending under the Bankruptcy Code, LANDLORD'S
right to terminate this Lease pursuant to this Section "13.1" shall be
subject to the rights of the Trustee in Bankruptcy to assume or assign
this Lease. The Trustee shall not have the right to
23
assume or assign this Lease unless the Trustee: (a) promptly cures all
defaults under this Lease, (b) promptly compensates LANDLORD for monetary
damages incurred as a result of such default, and (c) provides adequate
assurance of future performance.
(vi) Adequate Assurance of Future Performance. LANDLORD and TENANT
hereby agree in advance that adequate assurance of future performance, as
used in Section "13.1(B)(v)" above, shall mean that all of the following
minimum criteria must be met:
(a) The Trustee must pay to LANDLORD, at the time the next
payment of rent is then due under this Lease, in addition to such
payment of rent, an amount equal to the next three months rent due
under this Lease, said amount to be held by LANDLORD in escrow until
either the Trustee or TENANT defaults in its payment of rent or
other obligations under this Lease (whereupon LANDLORD shall have
the right to draw such escrow funds) or until the expiration of this
Lease (whereupon the funds shall be returned to the Trustee or
TENANT);
(b) The TENANT or Trustee must agree to pay to the LANDLORD,
at any time the LANDLORD is authorized to and does draw on the funds
escrowed pursuant to Section "13.1 (B)(vi)(a)" above, the amount
necessary to restore such escrow account to the original level
required by said provision;
(c) TENANT must pay its estimated pro-rata share of the cost
of all services provided by LANDLORD (whether directly or through
agents or contractors, and whether or not the cost of such service
is to be passed through to TENANT) in advance of the performance or
provision of such services;
24
(d) The Trustee must agree that TENANT'S business shall be
conducted in a first class manner, and that no liquidating sales,
auctions, or other non-first class business operations shall be
conducted on the premises;
(e) The Trustee must agree that the use of the premises as
stated in this Lease will remain unchanged;
(f) The Trustee must agree that the assumption or assignment
of this Lease will not violate or affect the rights of other tenants
of the LANDLORD.
(vii) Failure to Provide Adequate Assurance. In the event TENANT is
unable to:
(a) cure its defaults; or
(b) reimburse LANDLORD for its monetary damages; or
(c) pay the rent due under this Lease, on time (or within five
days of the due date); or
(d) meet the criteria and obligations imposed by Section "13.1
(B)(vi)" above; then TENANT agrees in advance that it has not met
its burden to provide adequate assurance of future performance, and
this Lease may be terminated by LANDLORD in accordance with Section
"13.1 (B)(i)" above.
Section 13.2 Default of TENANT
A. Events of Default. The following shall be Events of Default under this
Lease.
(i) TENANT'S failure to pay any monthly installment of base annual
rent or any other item of additional rent when due hereunder.
(ii) TENANT'S failure to make any other payment required under this
Lease if such failure shall continue beyond ten days after LANDLORD'S
notice that the same has not been paid.
(iii) TENANT'S violation or failure to perform any of the other
terms, conditions, covenants or agreements herein made by TENANT if such
violation or failure continues for a period of five days after LANDLORD'S
written notice thereof to TENANT.
25
(iv) In the event of any violation or failure to perform a covenant
as contemplated in Section '13.2(A)(iii)', and if such covenant cannot be
performed within the said five day period, then and in that event,
providing TENANT has promptly commenced to cure such violation and is
diligently proceeding with the cure the time within which TENANT may cure
the same shall be extended to such reasonable time as may be necessary to
cure the same with all due diligence.
B. If an Event of Default as hereinabove specified in Section '13.2(A)(i),
(ii) or (iii)' shall occur, and shall not be cured within the time period
specified in LANDLORD'S notice, or as to a default provided for in Section
'13.2(A)(iv)' if TENANT has commenced a cure but fails to diligently proceed
with same after five (5) days notice from LANDLORD then:
(i) LANDLORD may give TENANT a five day notice of its intention to
end the term of this Lease, and thereupon, at the expiration of said five
day period, this Lease shall expire as fully and completely as if the day
were the date herein originally fixed for the expiration of the term, and
TENANT shall then quit and surrender the premises to LANDLORD but TENANT
shall continue to remain liable as hereinafter provided; or, (ii)
LANDLORD, without prejudice to any other right or remedy of LANDLORD, held
hereunder or by operation of law, and notwithstanding any waiver of any
breach of a condition or Event of Default hereunder may, at its option and
without further notice, re-enter the Demised Premises or dispossess TENANT
and any legal representative or successor of TENANT or other occupant of
the premises by summary proceedings or other appropriate suit, action or
proceeding or otherwise and remove his, her or its effects and hold the
Demised Premises as if this Lease had not been made; and TENANT hereby
expressly waives the service of notice of intention to re-enter or to
institute legal proceedings to that end.
Section 13.3 A. Notwithstanding such default, re-entry, expiration and/or
dispossession by summary proceedings or otherwise, as provided in Section '13.2'
above, TENANT shall continue liable during the full period which would otherwise
have constituted the balance of the term hereof, and shall pay as liquidated
damages at the same times as the Basic Annual Rent and Additional Rent and other
charges become
26
payable under the terms hereof, a sum equivalent to the Basic Annual Rent and
Additional Rent and other charges reserved herein (less only the net proceeds of
reletting as hereinafter provided), and LANDLORD may rent the Demised Premises
either in the name of LANDLORD, reserving the right to rent the Demised Premises
for a term or terms which may be less than or exceed the period which would
otherwise have been the balance of the term of this Lease without releasing the
original TENANT from any liability, applying any monies collected, first to the
expense of resuming or obtaining possession, next to restoring the premises to a
rentable condition, and then to the payment of any brokerage commissions and
legal fees in connection with the reletting of the Demised Premises and then to
the payment of the Basic Annual Rent, Additional Rent and other charges due and
to grow due to LANDLORD hereunder, together with reasonable legal fees of
LANDLORD therefore.
B. Under any of the circumstances hereinbefore mentioned in which LANDLORD
shall have the right to hold TENANT liable to pay LANDLORD the equivalent of the
amount of all the Basic Rent, Additional Rent and other charges required to be
paid by TENANT less the net avails of reletting, if any, LANDLORD shall have the
election in place and instead of holding TENANT so liable, forthwith to recover
against TENANT as damages for loss of the bargain and not as a penalty an
aggregate sum which at the time of such termination of this Lease or of such
recovery of possession of the premises by LANDLORD.
Notwithstanding the above, LANDLORD represents that LANDLORD shall use
reasonable commercial efforts to mitigate TENANT'S damages. TENANT agrees to pay
the LANDLORD for LANDLORD'S actual and reasonable losses provided that LANDLORD
attempts to mitigate TENANT'S losses.
Section 13.4 LANDLORD and TENANT do hereby mutually waive trial by jury in
any action, proceeding or counterclaim brought by either LANDLORD or TENANT
against the other with regard to any matters whatsoever arising out of or in any
way connected with this Lease, the relationship of LANDLORD and TENANT, and
TENANT'S use or occupancy of the Demised Premises, provided such waiver is not
prohibited by any laws of the State of New York. Any action or proceeding
brought by either party hereto against the other, directly or indirectly,
arising out of this agreement
27
(except for a summary proceeding), shall be brought in a court in the County in
which the Demised Premises are located and all motions in any such action shall
be made in such County.
Section 13.5 TENANT hereby agrees that in any action or summary proceeding
commenced by the LANDLORD to recover possession of the Demised Premises, whether
by reason of non-payment or the holding over after expiration of its term,
TENANT will not interpose any non-mandatory counterclaim or set-off of whatever
nature or description in any such proceedings and TENANT will not seek to
consolidate or join for trial any such action or proceeding with any other
action or proceeding to which it is a party or over which it has control. This
provision shall not, however, be construed as a waiver of TENANT'S right to
assert such claims in any separate action brought by TENANT. Notwithstanding the
above, TENANT shall have the right to interpose all affirmative defenses and
commence third party actions.
Section 13.6 If TENANT shall default in the observance or performance of
any term or covenant on TENANT'S part to be observed or performed under or by
virtue of any of the terms or provisions in this article of this Lease, LANDLORD
may immediately or at any time thereafter and, without notice, perform the same
for the account of TENANT, and if LANDLORD makes any expenditures or incurs any
obligations for the payment of money in connection therewith including, but not
limited to, attorneys' fees in instituting, prosecuting or defending any action
or proceeding such sums paid or obligations incurred with interest and costs
shall be deemed to be additional rent hereunder and the sum shall be due
immediately upon LANDLORD incurring same and may be included as an item of
additional rent in any summary proceeding instituted by LANDLORD.
Section 13.7 In the event of any default by the TENANT hereunder and the
LANDLORD shall commence any action or other proceeding against the TENANT in
which the LANDLORD shall be successful, or which shall be settled by the payment
of a sum of money to the LANDLORD by the TENANT, the TENANT agrees to reimburse
the LANDLORD for attorneys' fees in connection with such action or proceeding
which shall be deemed additional rent and may be included by LANDLORD in any
summary proceeding instituted to recover possession of the Demised Premises.
28
Section 13.8 In the event that TENANT fails to pay, promptly when due, any
installment of rent or additional rent, or any other payment required pursuant
to the terms of this Lease then, in addition to all of the other rights and
remedies reserved to the LANDLORD herein, the LANDLORD may, upon giving TENANT
three (3) days' notice, require that all future payments of rent and additional
rent shall be paid by certified check or bank check only. The failure of TENANT
to comply with the terms and provisions of this paragraph shall be deemed to
constitute a breach of a material and substantial covenant of this Lease.
29
ARTICLE XIV
CUMULATIVE REMEDIES -- NO WAIVER
Section 14.1 The specific remedies to which the LANDLORD or the TENANT may
resort under the terms of this Lease are cumulative and are not intended to be
exclusive of any other remedies or means of redress of which they may be
lawfully entitled in case of any breach or threatened breach by either of them
of any provision of this Lease. The failure of the LANDLORD to insist in any one
or more cases upon the strict performance of any of the covenants of this Lease,
or to exercise any option herein contained, shall not be construed as a waiver
or relinquishment for the future of such covenant or option. A receipt by the
LANDLORD of rent with knowledge of the breach of any covenant thereof shall not
be deemed a waiver of such breach, and no waiver, change, modification or
discharge by either party hereto of any provision in this Lease shall be deemed
to have been made or shall be effective unless expressed in writing and signed
by both the LANDLORD and the TENANT. In addition to the other remedies in this
Lease provided, the LANDLORD shall be entitled to restraint by injunction of any
violation, or attempted or threatened violation, of any of the covenants,
conditions or provisions of this Lease or to a decree compelling performance of
any such covenants, conditions or provisions.
30
ARTICLE XV
SUBORDINATION
Section 15.1 It is hereby expressly agreed that this Lease and all rights
of the TENANT hereunder shall be subject and subordinate at all times to any
mortgages and any renewals, replacements, extensions of modifications thereof
which may now be or shall hereafter become liens on the Demised Premises or the
land and building of which the same form a part. The TENANT agrees that, at any
time upon five (5) days' written notice, the TENANT will execute and deliver to
the LANDLORD a subordination agreement confirming the provisions of this
article. Failure of TENANT to execute and deliver such agreement shall not
affect the subordination provided for hereunder.
Section 15.2 This Lease is specifically made subordinate to a
mortgage given to an institutional lender and notwithstanding whether or not any
formal subordination agreement is executed, this Lease shall, at all times, be
subordinate to any replacements, extensions, modifications or consolidations
thereof.
31
ARTICLE XVI
QUIET ENJOYMENT
Section 16.1 The LANDLORD covenants and agrees that the TENANT, upon
paying the basic rent and all other charges herein provided and observing and
keeping the covenants, agreements and conditions of this Lease on its part to be
kept, shall and may peaceably and quietly hold, occupy and enjoy the Demised
Premises during the term of this Lease.
32
ARTICLE XVII
NOTICES
Section 17.1 All notices, demands and requests which may or are required
to be given by either party to the other shall be in writing. All notices,
demands and requests by the LANDLORD to the TENANT shall be deemed to have been
properly given if sent by United States registered or certified mail, postage
prepaid or overnight carrier, such as Federal Express, addressed to the TENANT
at the Demised Premises or Temporary Demised Premises, or at such other place as
the TENANT may from time to time designate in a written notice to the LANDLORD.
All notices, demands and requests by the TENANT to the LANDLORD shall be deemed
to have been properly given if sent by United States registered or certified
mail, or overnight carrier, such as Federal Express, postage prepaid, addressed
to the LANDLORD at the address first above written, or at such other place as
the LANDLORD may from time to time designate in a written notice to the TENANT.
Notices to the TENANT may be given by the attorney for the LANDLORD with the
same force and effect as if given by the LANDLORD. Notices, demands and requests
which shall be served upon LANDLORD or TENANT in the manner aforesaid shall be
deemed to have been served or given for all purposes under this Lease at the
time such notice, demand or requests shall be received by addressee or returned
by Post Office or by an overnight carrier, such as Federal Express, as having
been "refused" or "undeliverable".
33
ARTICLE XVIII
DEFINITION OF CERTAIN TERMS, ETC.
Section 18.1 The captions of this Lease are for convenience and reference
only and, in no way, define, limit or describe the scope or intention of this
Lease or in any way affect this Lease.
Section 18.2 The term "TENANT" as referred to hereunder shall refer to
this TENANT and any successor or assignee of this TENANT.
Section 18.3 The term "LANDLORD" as used hereunder shall mean only the
owner for the time being of the land and building of which the Demised Premises
form a part, so that in the event of any sale or sales, or in the event of a
Lease of said land and building, this LANDLORD shall be and hereby is entirely
free and relieved of all covenants and obligations of LANDLORD hereunder and it
shall be deemed and construed without further agreement between the parties, or
their successors in interest, that the purchaser or lessee of the building has
agreed to carry out all of the terms and covenants and obligations of the
LANDLORD hereunder.
Section 18.4 LANDLORD represents that LANDLORD will require any subsequent
LANDLORD to assume all of the terms, covenants and conditions of this Lease.
34
ARTICLE XIX
INVALIDITY OF PARTICULAR PROVISIONS
Section 19.1 If any term or provision of this Lease or the application
thereof to any person or circumstance shall, to any extent, be invalid or
unenforceable, the remainder of this Lease, or the application of such term or
provision to persons or circumstances other than those as to which it is held
invalid or unenforceable, shall not be affected thereby, and each term and
provision of this Lease shall be valid and be enforced to the fullest extent
permitted by law.
35
ARTICLE XX
COVENANTS TO BIND AND BENEFIT RESPECTIVE PARTIES
Section 20.1 It is further covenanted and agreed by and between the
parties hereto that the covenants and agreements herein contained shall bind and
inure to the benefit of the LANDLORD, its successors and assigns, and the
TENANT, its successors and assigns, subject to the provisions of this Lease.
36
ARTICLE XXI
INSURANCE
Section 21.1 TENANT shall, at all times during the term hereby, carry
Public Liability Insurance for the Demised Premises naming LANDLORD as an
additional insured with limits of $1,000,000.00 per incident and $3,000,000.00
for the year for injury to persons and $250,000.00 for property damage. Said
coverage can be accomplished through use of a commercial umbrella policy.
Section 21.2 Prior to taking possession, TENANT shall deliver to the
LANDLORD a certificate of the insurance company licensed to do business in the
State of New York with a Bests rating of A, certifying that the aforesaid
liability policy is in full force and effect. A certificate evidencing the
renewal of such liability insurance policy shall be delivered to the LANDLORD at
least twenty (20) days before the expiration thereof and each such renewal
certificate shall include the LANDLORD as an additional insured. TENANT may
carry aforesaid insurance as a part of a blanket policy provided, however that a
certificate thereof naming the LANDLORD as an additional insured is delivered to
the LANDLORD as aforesaid. Such policy of insurance or certificate shall also
provide that said insurance may not be canceled unless ten (10) days' notice is
given to the LANDLORD prior to such cancellation and that the insurance as to
the interest of the LANDLORD shall not be invalidated by any act or neglect of
the TENANT.
Section 21.3 TENANT shall, prior to doing any work in the Demised
Premises, obtain any and all permits necessary therefore and will provide
Worker's Compensation Insurance pursuant to "Statute" and Liability Insurance in
the limits provided for in Section "21.1" hereof.
37
ARTICLE XXII
USE, ASSIGNMENT OR SUBLETTING
Section 22.1 The TENANT agrees to use the premises for general offices and
for no other purpose. TENANT shall not permit occupancy of the Demised Premises
which in the aggregate exceeds one person for every two hundred square feet of
usable area.
Section 22.2 Unless the LANDLORD shall have given its consent thereto,
this Lease may not be assigned nor may the Demised Premises be sublet in whole
or in part. Such approval will not be unreasonably withheld. In determining the
reasonableness, the LANDLORD shall take into consideration the use to which the
sub-tenant will put the space and the nature of the sub-tenant's business in
order to maintain the integrity of the building as a whole. LANDLORD shall not
unreasonably withhold, delay nor condition such approval. Such approval shall
take place within twenty (20) days of the notification.
Section 22.3 Notwithstanding anything herein to the contrary, LANDLORD
shall have the right of first refusal to recapture the Leased premises or any
part thereof, prior to any sublet or assignment. In the event TENANT shall
desire to assign or sublet this Lease, TENANT shall provide written notice of
same to LANDLORD. LANDLORD shall, within twenty (20) days of receipt of such
notice, notify TENANT as to whether or not LANDLORD desires to recapture the
Demised Premises. In the event that LANDLORD shall elect to recapture the
Demised Premises or any part thereof, it shall be deemed that the space is
recaptured by the LANDLORD on the thirtieth (30th) day following LANDLORD'S
notice to TENANT of its election. Within said thirty (30) day period, TENANT
shall remove all of TENANT'S effects and personal property therefrom. If
LANDLORD shall elect not to recapture the Demised Premises or any part thereof,
TENANT may, after prior written consent of the LANDLORD, assign or sublet the
Demised Premises subject to Section 22.4.
38
Section 22.4 In the event that TENANT shall assign this Lease and shall
receive any consideration therefore in excess of Basic Annual Rent and
Additional Rents after deducting normal and customary brokerage costs, if
applicable, therein, one-half of such consideration shall be paid to the
LANDLORD as additional rent. In the event TENANT shall sublet any of the space
demised hereunder and the rent and/or additional rent reserved under any such
sublease shall be in excess of the rent provided for hereunder, after deducting
normal and customary brokerage costs, if applicable, TENANT shall pay to the
LANDLORD, as additional rent, as and when same is collected, one-half the
difference between the rent and additional rent reserved herein and the rent and
additional rent reserved in such sublease.
Section 22.5 In the event that any sub-tenant should hold over in the
premises beyond the expiration of the term of this Lease, the TENANT hereunder
shall be responsible to the LANDLORD for all Basic Annual Rent and Additional
Rent until the premises are delivered to the LANDLORD in the condition provided
for in this Lease.
Section 22.6 TENANT shall pay LANDLORD'S reasonable legal fees with
reference to approving any assignment and assumption agreement.
39
ARTICLE XXIII
RULES AND REGULATIONS
Section 23.1 The TENANT agrees that it will abide by the rules and
regulations attached hereto as Exhibit "E" and any reasonable amendments or
additions thereto, provided the same are uniform as to all tenants.
40
ARTICLE XXIV
LANDLORD'S LIABILITY
Section 24.1 In the event that the LANDLORD shall default under the terms
of this Lease and the TENANT shall recover a judgment against the LANDLORD by
reason of such default or for any reason arising out of the tenancy or use of
the premises by the TENANT or the Lease of the premises to the TENANT, the
LANDLORD'S liability hereunder shall be limited to the LANDLORD'S interest in
the land and building of which the Demised Premises form a part and no further
and the TENANT agrees that in any proceeding to collect such judgment, the
TENANT'S right to recovery shall be limited to the LANDLORD'S interest in the
building of which the Demised Premises form a part.
Section 24.2 LANDLORD represents that LANDLORD is not in default to
LANDLORD'S current mortgagee.
Section 24.3 LANDLORD represents that it is the Owner in Fee of the
Demised Premises and the property upon which it is constructed.
41
ARTICLE XXV
ENTIRE AGREEMENT
Section 25.1 This instrument contains the entire agreement between the
parties hereto and the same may not be changed, modified or altered except by a
document in writing executed and acknowledged by the parties hereto.
42
ARTICLE XXVI
CERTIFICATES
Section 26.1 Upon request by the LANDLORD, the TENANT agrees to execute
any certificate or certificates evidencing the commencement date of the term of
the Lease and the fact that the Lease is in full force and effect, if such is
the case, and that there are no set-offs or other claims against the LANDLORD or
stating those claims which the TENANT might have against the LANDLORD.
Section 26.2 Upon request by the LANDLORD, the TENANT agrees to execute a
memorandum of this Lease in recordable form which memorandum shall set forth the
commencement dates of the Lease and the subordination of the Lease to a
permanent first mortgage to be held by an institutional lender.
43
ARTICLE XXVII
SECURITY
Section 27.1 TENANT has deposited with LANDLORD an irrevocable,
unconditional Letter of Credit in the amount of $250,000.00 issued by
_________________, as security for the faithful performance and observance by
TENANT of the terms, provisions and conditions of this Lease; it is agreed that
in the event TENANT defaults in respect of any of the terms, provisions and
conditions of this Lease, including, but not limited to, the payment of Basic
Annual Rent and Additional Rent, LANDLORD may draw down the Letter of Credit and
use, apply or retain the whole or any part of the security so deposited to the
extent required for the payment of any Basic Annual Rent and Additional Rent or
any other sum 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 re-letting of the premises, whether
such damages or deficiencies accrued before or after summary proceedings or
other re-entry by LANDLORD and retain the balance of the funds drawn down
pursuant to this Article. In the event TENANT shall default and LANDLORD shall
apply all or any portion of the security to cure such default, TENANT shall,
within said ten (10) days after notification from LANDLORD that LANDLORD has
made such application, replace with LANDLORD by certified or bank check, an
amount equal to the amount so applied by LANDLORD. In the event TENANT shall
fail to replace such amount within the ten (10) day period, LANDLORD shall have
the same remedies for nonpayment thereof as for nonpayment of rent. In the event
that TENANT shall fully and faithfully comply with all of the terms, provisions,
covenants and conditions of this Lease, the security shall be returned to TENANT
after the date fixed as the end of the Lease and after delivery of entire
possession of the Demised Premises to LANDLORD. In the event of a sale of the
land and building or leasing of the building, of which the Demised Premises form
a part, LANDLORD shall have the right to transfer the security to the vendee or
lessee and the LANDLORD shall thereupon be released by TENANT
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from all liability for the return of such security, and TENANT agrees to look to
the new LANDLORD solely for the return of said security; and it is agreed that
the provisions hereof shall apply to every transfer or assignment made of the
security to a new LANDLORD. TENANT further covenants that it will not assign or
encumber or attempt to assign or encumber the monies deposited herein as
security and that neither LANDLORD nor its successors or assigns shall be bound
by any such assignment, encumbrance, attempted assignment or attempted
encumbrance.
Section 27.2 The Letter of Credit to be delivered to the LANDLORD
hereunder shall provide that the same may be drawn down by LANDLORD delivering
the Letter of Credit to Fleet Bank, N. A., at an office within the Counties of
New York or Nassau, together with a letter stating that the TENANT is in default
under this Lease beyond its time to cure.
Section 27.3 The Letter of Credit shall be for a period of three (3) years
and nine (9) months and shall be automatically reduced on the first day of each
Lease Year so that on the first day of the thirty-eighth (38th) month of the
Lease the Letter of Credit shall be reduced to $184,357.71; on the first day of
the subsequent six months the Letter of Credit shall be reduced by $30,726.29 so
that on the first day of the forty-fifth (45th) month of the Lease the LANDLORD
shall retain a Letter of Credit as security in the amount of $34,916.00.
In the event that Fleet Bank, N.A. shall refuse to issue a three (3) year
nine (9) month Letter of Credit, but shall instead wish to issue a series of
Letters of Credit, then and in that event, unless TENANT shall replace the
Letter of Credit at least thirty (30) days prior to the expiration date of the
Letter of Credit, LANDLORD shall have the right to draw down the Letter of
Credit and hold same as security, in which event LANDLORD will remit to TENANT
the amount necessary so that the deposit will be equal to the reduced amounts of
the Letter of Credit when those reductions are provided for.
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ARTICLE XXVIII
BROKER
Section 28.1 TENANT represents that it dealt only with Real Estate
Strategies, Ltd., as broker in connection with this transaction and TENANT
agrees to indemnify LANDLORD against any claims or expenses which the LANDLORD
may incur by reason of the TENANT having dealt with any other broker in
connection with this transaction.
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ARTICLE XXIX
SIGNS
Section 29.1 TENANT, at TENANT'S sole cost and expense, may have installed
building standard signage on the entrance doors and the outside directory.
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ARTICLE XXX
HOLDING OVER
Section 30.1 TENANT covenants that it will vacate the Premises immediately
upon the expiration or sooner termination of this Lease. If the TENANT retains
possession of the Premises or any part thereof after the termination of the
term, the TENANT shall pay the LANDLORD Annual Basic Rent at 150% of the monthly
rate specified in Section 3.1 for the time the TENANT thus remains in possession
and, in addition thereto, shall pay the LANDLORD for all damages, consequential
as well as direct, sustained by reason of the TENANT'S retention of possession.
The provisions of this Section do not exclude the LANDLORD'S rights of re-entry
or any other right hereunder, including without limitation, the right to refuse
150% of the monthly rent and instead to remove TENANT through summary
proceedings for holding over beyond the expiration of the term of this Lease.
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IN WITNESS WHEREOF, the parties hereto have hereunto set their
hands and seals the day and year first above written.
INDUSTRIAL & RESEARCH ASSOCIATES CO.
BY: ___________________________________
INTELLICHECK, INC.
BY: ___________________________________
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