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EXHIBIT 10.18
AGREEMENT AND LEASE
(Xxxxxxx Building)
THIS AGREEMENT AND LEASE is entered into as of this 1st day of September,
1978 between XXXXXXX & ASSOCIATES, a Pennsylvania limited partnership (the
"Landlord"), and EDUCATION MANAGEMENT CORPORATION, a Pennsylvania corporation
(the "Tenant").
FOR and in consideration of the mutual benefits hereinafter provided, and
each intending to be legally bound, the said Landlord and Tenant do hereby
covenant and agree as follows:
1. LEASING CLAUSE
The Landlord does hereby lease and grant to the Tenant, and the Tenant does
hereby hire and take as Tenant from the Landlord, the Premises as defined in
Paragraph 2, subject to and in accordance with all the terms and conditions of
this Lease.
2. DESCRIPTION OF THE PREMISES
The Premises consist of the following portions of the building known as the
Xxxxxxx Building, 000 Xxxx Xxxxxx, Xxxxxxxxxx, Xxxxxxxxxxxx 00000: (i) the
space in the Basement presently occupied by Tenant and containing approximately
2,750 sq. ft. of space, (ii) the street level gallery area (consisting of
approximately 2,756 sq. ft.), and (iii) the entire 2nd, 3rd, 4th, 5th, 6th,
7th, 8th, 9th, and 1Oth Floors, which together contain approximately 65,700 sq.
ft. of space. (The aforesaid
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square footage figures are intended to be exclusive of stairwells and elevator
shafts.)
3. PURPOSES
The Premises may be used and enjoyed for the operation of an art school
and/or for any other lawful purpose.
4. TERM OF THE LEASE
The initial term of this Lease will begin at 12:01 A.M. on September 1, 1978
and will end at midnight on August 31, 1990, except as that period may be
extended by the renewal options provided for in Paragraph 5 of this Lease or
otherwise by the mutual agreement of the parties.
5. RIGHTS OF RENEWAL
The Tenant will have the right, at its option, to renew and to extend this
Lease for a term of five (5) years beginning September 1, 1990, and ending
August 31, 1995. If that first right to renew this Lease is exercised, the
Tenant will have a further right, at its option, to renew this Lease for an
additional term of five (5) years beginning September 1, 1995, and ending
August 31, 2000. The Tenant may exercise those renewal options by giving
written notice to the Landlord at least twelve (12) full months before the
expiration of the then-current term. However, notwithstanding the foregoing,
the Tenant's purported exercise of a renewal option will be null and void if,
prior to the exercise of the renewal option by the Tenant, the Landlord has
entered into a bona fide and legally binding
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agreement to sell all of the Xxxxxxx Building and the adjacent garage building
owned by Landlord (known as the Penn-Sixth-Liberty Garage Building) to a third
party purchaser as part of the assembly by that purchaser of all the properties
within the block bounded by Penn Avenue, Sixth Avenue, Liberty Avenue and Fifth
Avenue Extension, and then only if the agreement between the Landlord and the
third party purchaser calls for a closing on or before the last day of the
then-current term of this Lease. In the event that the exercise of a renewal
option by the Tenant is null and void under the preceding sentence, the Tenant
will have the right at its option to reinstate the effectiveness of the
exercise of a renewal option if and when the Landlord's said agreement to sell
to a third party purchaser is terminated or is not, or cannot be, effectively
closed for any reason before the end of the then-current term of this Lease.
In the event of the effective exercise of the renewal options, all of the terms
and conditions of this Lease will continue in effect during the period(s) of
renewal, except as is otherwise specifically provided in Paragraph 6 of this
Lease with respect to rental payments.
6. RENT
(a) GENERAL.
The Tenant will make monthly Rental Payments to the Landlord during the
term of this Lease and any extension thereof. All Rental Payments will be made
by delivery of a check payable to "Realty Growth Corporation" as agent for the
Landlord,
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at the address specified in subparagraph 29(a) of this Lease. Rental Payments
will be paid in advance and without demand, on or before the tenth day of each
month. Any late payment or portion thereof will bear simple interest at the
annual rate of 12% until paid. The amount of each Rental Payment will be the
sum of (1) the Base Rental Payment and (2) the Escalation Rental Payment.
(b) BASE RENTAL PAYMENTS.
The Base Rental Payment payable by the Tenant during the initial
term of this Lease will be:
Monthly Base
Dates Rental Payment
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September 1, 1978 to April 30, 1979 $34,903.53
May 1, 1979 to April 30, 1980 $32,503.53
May 1, 1980 to May 31, 1980 $33,336.86
June 1, 1980 to April 30, 1981 $33,327.87
May 1, 1981 to August 31, 1990 $34,094.54
If the Tenant exercises its renewal options under paragraph 5 of this
Lease, the Tenant's Base Rental Payments during the renewal periods will be:
Monthly Base
Dates Rental Payment
----- --------------
September 1, 1990 to August 31, 1995 $44,616.67
September 1, 1995 to August 31, 2000 $53,225.00
(c) ESCALATION RENTAL PAYMENTS.
In addition to the Base Rental Payments set forth in Paragraph 6(b),
beginning with the rental payment due for the month of March 1979 and continuing
thereafter during the term of
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this Lease and any renewal thereof, the Tenant will pay Escalation Rental
Payments to the Landlord equal to one-twelfth (1/12th) of the net aggregate of
the following amounts (provided, however, that, for the months March through
August of the year during which the final expiration of the term of this Lease
[as extended by the exercise of any renewal options by Tenant] occurs,
Escalation Rental Payments shall equal one-sixth (1/6th) of the net aggregate
of the following amounts):
(i) 97.9% of increases or decreases (if any) in real estate taxes
on the Xxxxxxx Building paid by the Landlord to the City of Pittsburgh, the
Pittsburgh School District and Allegheny County during the preceding
calendar year as compared to the real estate taxes paid by Landlord for the
calendar year 1977 (Landlord and Tenant agree that said taxes totaled
$28,382.00 for calendar year 1977);
(ii) 100% of increases or decreases (if any) in the portion of the
all risks insurance cost incurred by Landlord during the preceding calendar
year in connection with Xxxxxxx Building which is properly allocable to the
Premises occupied by Tenant in said building as compared to such cost as
incurred by Landlord for calendar year 1977 (Landlord and Tenant agree that
said cost totaled $6,572.00 for calendar year 1977);
(iii) 100% of increases or decreases (if any) in the costs of the
security services furnished to the Premises by the Landlord during the
preceding calendar year
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as compared to such costs as incurred by Landlord for calendar year 1977
(Landlord and Tenant agree that said costs totaled $1,267.00 for calendar
year 1977);
(iv) 100% of increases or decreases (if any) in the water and
sewer charges which are separately metered to the Premises occupied by the
Tenant in the Xxxxxxx Building during the preceding calendar year as
compared to said charges for calendar year 1977 (Landlord and Tenant agree
that said charges totaled $3,109.00 for calendar year 1977);
(v) 100% of increases or decreases (if any) in the actual net
cost to the Landlord during the preceding calendar year of furnishing those
portions of work required for the proper inspection, servicing, repair,
maintenance and improvement of the elevators in the Xxxxxxx Building which
are specifically listed in Appendix "D" to this Lease (but not the cost of
any work not specifically listed in Appendix "D") as compared to $6,197.00
(the actual net cost shall exclude (1) costs incurred by Landlord for which
it was reimbursed by insurance, the Tenant or third parties and (2) costs
which were incurred by Landlord primarily because of negligent or
intentional acts or omission of or attributable to Landlord); and
(vi) 100% of increases or decreases (if any) in wages and benefit
costs during the preceding year for the full-time Heavy Duty Cleaners, the
full-time Maintenance
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Employees, the full-time Elevator Operators and the part-time employees in
these job categories provided by the Landlord to perform work at the
Premises under the terms of collective bargaining agreements with
Pittsburgh Local 29 of the Service Employees' International Union as
compared to said wages and benefit costs for calendar year 1977 (Landlord
and Tenant agree that these costs totaled $58,757.00 for calendar year
1977).
On or before March 1, 1979 and on or before March 1 of each succeeding year
during the term of this Lease and any renewal thereof, the Landlord will
calculate the Escalation Rental Payments, if any, which the Tenant will pay for
March and during the succeeding twelve (12) months, or until termination of the
Lease, and notify Tenant in writing of the amount of those payments and the
basis of calculation. Upon request of the Tenant, the Landlord will provide
copies of receipts or other reasonably satisfactory documentation of the costs
incurred during the preceding calendar year which were used by the Landlord to
determine the Escalation Rental Payments. With the exception of the Escalation
Rental Payments provided for in this subparagraph, the Landlord will not be
entitled to any increase in Rental Payments on account of any cost increases
incurred by it in connection with the performance of its duties and obligations
under the terms of this Lease. Any special assessment levied against the
Premises for the Purpose of improvements to or for the benefit of the Premises
will be paid
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by the Landlord and will not be taken into account in establishing Escalation
Rental Payments.
The parties hereto understand and agree that the Landlord shall not be
entitled to Escalation Rental Payments on account of, nor to any other
reimbursement for, any costs or expenses (or increases therein) which it incurs
in connection with the six categories of costs and expenses listed in Clauses
(i) through (vi) of this Subparagraph 6(c) insofar as such costs and expenses
(and increases therein) are incurred during or are attributable to the months
January through August of the year during which the final expiration of the term
of this Lease (as extended by the exercise of any renewal options by Tenant)
occurs.
7. ALTERATIONS, ADDITIONS AND IMPROVEMENTS
(a) INITIAL IMPROVEMENTS.
The Landlord agrees to make, at its own expense, the improvements
listed in Appendix "A" to this Lease (insofar as they apply to these Premises),
in accordance with plans and specifications prepared by Klaus Associates (which
plans and specifications have been approved by Landlord) and to pay for the work
promptly upon the presentation of the contractor's invoices accompanied by
certifications by the architect and the Tenant (or other evidence reasonably
acceptable to the Landlord) that such items have been incorporated in the
Premises.
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(b) ADDITIONAL IMPROVEMENTS.
In addition to the Landlord's improvements referred to in subparagraph
7(a), the Landlord promptly will take care of all of the maintenance items and
other responsibilities identified in Appendix "B" to this Lease (insofar as they
apply to these Premises). All costs relating to said work will be borne by the
Landlord. All of the improvements provided for in this subparagraph will be
made in accordance with the plans and specifications prepared by Klaus
Associates (which plans and specifications have been approved by Landlord).
(c) FUTURE TENANT IMPROVEMENTS.
The Tenant will have the right, at its own expense, from time to time
during the term of this Lease to make such nonstructural alterations, additions
and changes in and to the Premises as it finds necessary or convenient to its
purposes. The Tenant may, at its own expense, from time to time during the term
of this Lease, make such structural alterations, additions and changes as it
finds necessary or convenient to its purposes, provided the Tenant shall have
first submitted to the Landlord plans and reasonably detailed specifications
covering such alterations, additions and changes, the names of the architect and
contractor who will carry out the work, and copies of its agreements with them,
and the Landlord shall have given its consent in writing to the alterations,
additions and changes and approved the architect and contractor. Such consent
and approval shall not be withheld unreasonably. Any alteration, addition or
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change will be made in a good and workmanlike manner, and in compliance with
all applicable permits and authorizations and building and zoning laws and with
all other laws and ordinances. The alterations, additions and improvements
listed in Appendix "F" to this Lease (insofar as they apply to the Premises)
will be made by the Tenant in accordance with plans and specifications prepared
by Klaus Associates (which plans and specifications have been approved by
Landlord), will be paid for by the Tenant, and are hereby deemed to be Tenant
improvements. (The improvements listed in Appendices "X," "X," and "F" are as
shown on a set of 14 drawings which are listed in Appendix "E" to this Lease,
copies of said drawings having been signed by the parties hereto in connection
with the execution of this Lease.) Any and all alterations, additions and
improvements (together with fixtures and other personal property) placed in the
Premises at any time by the Tenant will be Tenant improvements and will remain
the personal property of the Tenant unless otherwise determined by the mutual
agreement of the parties in writing. Such alterations, additions, improvements
and any personal property of the Tenant may be removed by it at any time during
the term of this Lease, provided only that the Tenant will be responsible for
the restoration of any structural damage or other material damage which may be
caused by such removal so that the Premises are in such condition that they
could be rented for a normal use of premises of this type and at a rental rate
consistent with that prevailing at the time for similar premises.
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8. UTILITIES AND OTHER SERVICES
The Tenant will pay the costs of steam, gas, electricity and rubbish
removal during the term of this Lease as soon as the same may be payable. The
Landlord will pay the costs of water and sewer. The Landlord will also provide,
at its expense, a central office alarm security system for the Premises,
consisting of the existing system or equivalent, and other security services for
the Premises as required.
9. REAL ESTATE TAXES
The Landlord will, during the term of this Lease, pay and discharge
when due all real estate taxes assessed against the Premises.
10. MAINTENANCE
Except as is otherwise provided in Paragraph 12 respecting damage
caused by, or attributable to, the Tenant, and except as is otherwise provided
in Paragraph 14 respecting destruction of the Premises, the respective
responsibilities of the Landlord and the Tenant regarding maintenance of the
Premises will be as follows:
(a) THE TENANT'S RESPONSIBILITIES.
The Tenant, at its expense, will be responsible for repair and maintenance
of the Premises as follows:
(i) All janitorial services and customary and ordinary
maintenance to the interior of the Premises (other than as provided in
subparagraph 10(b)), including
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the replacement of fluorescent and other light bulbs and ballasts;
(ii) Repair and maintenance of the individual heat exchangers,
heat valves, air conditioning compressors and air handling units located on
the various floors and exposed lateral heating and cooling pipes;
(iii) Repair, maintenance and replacement of the following
portions of the Cooling Tower installation:
(a) Circulation System: the valves, the pump, the
controls and the motor; and
(b) Water Tower: the fan, the fan motor, the fan drive
gear box, the fan control and the gate valve.
(iv) Tenant will also provide, at its own cost (either with its
own employees or by a service contract, if Tenant so elects), the services
for maintaining the Cooling Tower installation which are listed in Appendix
"C" to this Lease;
(v) Repair and maintenance of exhaust fans;
(vi) Repair and maintenance of all toilet facilities and
fixtures, including sinks, urinals, water closets, soap dispensers, faucets
and valves associated therewith;
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(vii) Repair and maintenance of the electrical system from the main
distribution panels on each floor to the points of electrical usage;
(viii) Repair, maintenance and replacement of all floor coverings,
interior wall coatings, interior wall coverings, ceiling suspension systems
and ceiling tiles and coatings; provided, however, that, if damage to such
items is caused by water seepage from outside windows, outside walls or the
roof, Landlord shall reimburse Tenant for the cost of repairing or
replacing such items;
(ix) Control of day-to-day operations of the steam system;
(x) Repair, maintenance, cleaning and replacing doors; and
(xi) Repair, maintenance, cleaning and replacing ground level windows
and interior windows and cleaning exterior windows above ground level.
(b) THE LANDLORD'S RESPONSIBILITIES.
The Landlord, at its expense, will be responsible for all repairs and
maintenance of the Premises not specifically made the responsibility of the
Tenant under subparagraph 10(a) including, without limitation, the following
items:
(i) Repair and maintenance of the roof and of all structural
portions of the Premises (including, without limitation, all stairways,
floors, ceiling and walls, but not the coverings on floors, walls or
ceiling);
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(ii) Cleaning, inspecting, servicing, repairing and maintaining the
elevators so that they remain in a clean, safe and operable condition at
all times, including but not limited to oiling and greasing twice monthly
and including, but not limited to, the items listed in Appendix "D" to this
Lease;
(iii) Repair and maintenance of all plumbing including, but not
limited to, the water and sanitary sewer lines, but not the items listed as
item (vi) in subparagraph 10(a);
(iv) Repair and maintenance of all portions of the heating, air
conditioning and air handling systems other than the items to be maintained
by the Tenant under items (ii), (iii), (iv) and (v) in subparagraph 10(a),
including, but not limited to, the main vertical heating distribution pipes
system and concealed lateral heating pipes and the main steam valve;
(v) Repair and maintenance of the electrical system up to the
main distribution panels on each floor;
(vi) Repair and maintenance of the exterior of the Xxxxxxx Building;
(vii) Transporting rubbish from the floors to the loading dock;
(viii) Cleaning the sidewalk and removing snow and ice during the
winter;
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(ix) Cleaning the outside area of the loading dock and the land and
the alley area at the rear of the Xxxxxxx Building;
(x) Cleaning the facilities, including the basement restroom,
used by Landlord's employees;
(xi) Locking and unlocking the building at scheduled times and arming
and disarming the security system;
(xii) Turning the electricity on and off; and
(xiii) Repair and maintenance (but not cleaning) of all exterior
windows above the ground level; provided, however, that, if damage to such
windows is caused by Tenant or Tenant's students, Tenant shall reimburse
Landlord for the cost of repairing such windows.
11. INSURANCE
(a) FIRE AND CASUALTY AND OTHER INSURANCE.
The Landlord will keep the building of which the Premises are a part
insured against loss or damage by those risks now covered by the all risks
insurance policy presently owned by Landlord in connection with the Premises.
Such insurance at all times will be in an amount sufficient to cover 90% of the
cost of replacement of the building in substantially the same condition as it
was when the loss occurred. The Landlord shall also provide insurance against
flood damage up to the limit of $100,000.00. The Tenant will reimburse the
Landlord for the
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increases in costs of such insurance insofar as that is provided for in
subparagraph 6(c) of this Lease. If and to the extent to which the Landlord
has a restoration obligation under Paragraph 14 of this Lease or the Premises
are otherwise restored, all proceeds of such insurance will be used first to
restore the Premises. The Landlord will also obtain and maintain liability
insurance in the single limit of $1,000,000.00 per occurrence for bodily injury
and property damage, or the loss of use thereof, to protect itself against any
liability or claim which may arise on account of Landlord's activities in
connection with the Premises. The all risk policy will provide that Landlord
may waive its subrogation rights against the Tenant and the Landlord hereby
waives subrogation rights against Tenant on that policy. Both the all risk
policy and the liability insurance policy shall provide that the same may not
be cancelled or materially changed by the insurer except after twenty (20) days
prior written notice by the insurer to the Tenant. The Landlord will furnish
certificates of insurance for these policies to the Tenant within a reasonable
time after they are secured. In connection with those employees of Landlord or
Landlord's agent who work at the Premises, Landlord will obtain and maintain,
or cause its agent to obtain and maintain, Workmen's Compensation Insurance and
employer's liability insurance.
The Tenant may, at its option, insure (in amounts and under terms which are
satisfactory to it) its personal property and the Tenant improvements located on
the Premises to the extent
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that such contents and Tenant improvements are the personal property of the
Tenant and are not covered by the Landlord's insurance. Any such policies will
provide that the Tenant may waive its subrogation rights against the Landlord
and the Tenant hereby waives subrogation rights against Landlord on any such
policies.
(b) LIABILITY INSURANCE.
The Tenant will obtain and maintain at its own expense liability insurance
for the Premises to protect itself against any liability or claim which may
arise on account of any actionable injury on account of Tenant's activities in
connection with the Premises in the single limit of $1,000,000.00 per occurrence
for personal injury and property damage. The Tenant will also obtain and
maintain at its own expense Workmen's Compensation Insurance in accordance with
the Workmen's Compensation Act of the Commonwealth of Pennsylvania and
employer's liability insurance with the limit of $100,000.00 per occurrence.
All such policies shall provide that the same may not be cancelled or materially
changed by the insurer except after twenty (20) days prior written notice to the
Landlord. The Tenant shall furnish certificates of insurance for these policies
to Landlord within a reasonable time after they are secured.
12. LIABILITY FOR DAMAGES
The parties agree that each will indemnify the other for, and save the
other harmless against, any and all losses, expenses, claims and/or liability
for damages of any kind
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which may arise at any time (1) from any failure of the indemnifying party to
fulfill the maintenance obligations imposed on it under Paragraph 10 of this
Lease, (2) from any negligent act or omission of or attributable to the
indemnifying party, and/or (3) from use of the Premises by the indemnifying
party. The parties also agree that each will indemnify the other for, and save
the other harmless against, any claims or liability for compensation under the
Workmen's Compensation Act arising out of injuries sustained by any employee of
the indemnifying party and/or of any licensees, contractors or subcontractors
of the indemnifying party. However, except as otherwise specifically provided
in Paragraphs 11 and 14 of this Lease, neither party will be liable to the
other for any damage of any kind which may arise at any time from any negligent
act or omission of any co-tenant, subtenant, assignor or other occupant of the
building, or of any person whomsoever other than such party or those for whom
it is responsible, or from any act beyond the control of such party. All
subleases will require the subtenant to indemnify, defend and save the Tenant
and the Landlord harmless from any and all losses, expenses, claims and/or
liability for damages of any kind which may arise at any time (1) from any
negligent act or omission of or attributable to the subtenant or any officer,
employee, agent, contractor or invitee of the subtenant, and/or (2) use of the
Premises by the subtenant, except as the Landlord may otherwise approve.
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13. COMPLIANCE WITH LEGAL REQUIREMENTS
(a) GENERAL.
Each of the parties will comply with all applicable statutes, ordinances,
rules, orders, regulations and requirements of the federal, state, county and/or
city governments, insofar as they may be properly applied to the respective
obligations of the parties in connection with the Premises or the conduct of the
parties therein. The Landlord shall be responsible for keeping the Premises in
compliance at all times with all city, county, state and federal building
requirements which may apply to the Premises insofar as such building
requirements shall require that capital improvements be made to the Premises;
provided, however, that, insofar as any such building requirement (a) shall be
applicable to the Premises solely because of the use of the Premises as a school
by Tenant and (b) shall require capital improvements which improve the Premises
solely for use as a school (such building requirements hereinafter shall be
referred to as "School Requirements"), Tenant shall be responsible for keeping
the Premises in compliance with such School Requirements, subject, however, to
the terms and conditions set forth below in Subparagraph (b) of this Paragraph
13.
(b) SCHOOL REQUIREMENTS.
(i) Tenant shall have the right, at its sole discretion, to
contest any School Requirements and to decide if, when, and to what extent
it will make any capital
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improvements to the Premises in order to comply with any School
Requirements, and this Paragraph 13 shall not in any event create any
contractual obligations to Landlord on the part of Tenant to make, or to
cause to be made, any capital improvement to the Premises on account of any
School Requirement; provided, however, that failure of the Tenant to make
said capital improvements will not release the Tenant of its contractual
obligations to pay rent and abide by the other terms and conditions of this
Lease.
(ii) If, during the initial term or any renewal period of this
Lease, Tenant makes capital improvements to the Premises on account of any
School Requirements and if, upon the completion of such capital
improvements, the remaining portion of the then current term of the Lease
(as it may have been extended at the time by the exercise of any renewal
option by Tenant) will not allow Tenant sufficient time to amortize the
costs of those capital improvements at a rate of $2,000 per month beginning
on such completion date and continuing during such remaining term of the
Lease, then Tenant shall have the right (but not the obligation) to extend
the term of the Lease (and, if it so desires, also to extend the term of
the Lease for the Mezzanine space in the Penn-Sixth-Liberty Garage
Building) beyond the termination date of such remaining term for as many
one (1) year periods as may be required to permit such costs to be fully
amortized at that rate with complete
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amortization occurring during the final year of the term of the Lease as so
extended. Tenant agrees that estimates for the capital improvements will
be submitted to the Landlord prior to the Tenant undertaking any such
capital improvements. If the total estimated cost of the capital
improvements is such that the Tenant could not amortize the cost over a
period extending more than two (2) years beyond the expiration of the
second renewal period, then Landlord shall have the option of terminating
this Lease upon not less than ninety (90) days written notice to the Tenant
unless Tenant agrees within twenty (20) days thereafter to increase its
amortization schedule so as to permit complete amortization within a period
not extending more than two (2) years beyond the expiration date of the
second renewal period.
(iii) If any one or more School Requirements shall require Tenant to
make capital improvements to the Premises costing in the aggregate in
excess of $240,000 during the initial term of this Lease or $120,000 during
the first renewal period or $60,000 during the second renewal period, then
Tenant shall have the option of terminating this Lease upon not less than
ninety (90) days written notice to Landlord, rather than making such
capital improvements. However, Landlord shall have the right (by written
notice to Tenant within twenty (20) days after receipt by Landlord of a
notice from Tenant of its intention
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to terminate this Lease under the terms of the preceding sentence) to elect
to continue the Lease in full force and effect during such remaining term,
in which event Landlord shall share the costs of such capital improvements
so that Tenant's aggregate costs for such capital improvements do not
exceed $240,000 during the initial term of this Lease or $120,000 during
the first renewal period or $60,000 during the second renewal period.
(iv) If, during the initial term of this Lease, any one or more
School Requirement shall require Tenant to make capital improvements to the
Premises costing in the aggregate in excess of $120,000, Landlord will, at
Tenant's request, pay any costs in excess of $120,000 (but Landlord shall
not be required to pay more than $120,000 of excess costs) and Tenant will
thereafter pay Landlord equal monthly additional rental payments over the
remaining term of the Lease. Such payments shall equal the amount expended
by Landlord for such excess costs divided by the number of months in the
remaining term of the Lease plus interest floating at the rate of 2% above
the Prime Rate.
(v) If any School Requirement shall require Tenant to make
capital improvements to the Premises which will be completed less than two
(2) years prior to the termination date of the then current term of the
Lease (as it may have been extended at the time by the exercise of any
renewal option by Tenant) and the cost of such capital
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improvements cannot be fully amortized at the rate of $2,000 per month
beginning on the completion date of the capital improvements and continuing
during such remaining term, then Tenant shall have the option of
terminating this Lease effective as of a termination date to be specified
in that notice (which date shall not be less than ninety (90) days after
the date of the written notice to Landlord), rather than making such
capital improvements. However, Landlord shall have the right (by written
notice to Tenant within twenty (20) days after receipt by Landlord of a
notice from Tenant of its intention to terminate this Lease under the terms
of the preceding sentence) to elect to continue the Lease in full force and
effect during such remaining term, in which event Landlord shall contribute
to the costs of such capital improvements to the extent necessary so that
Tenant is able to amortize Tenant's total aggregate costs for such capital
improvements at a rate of $2,000 per month beginning on the completion date
thereof and continuing over the then remaining term of the lease, or any
extensions thereof.
(vi) If Tenant is required to and does make any capital improvement
to the Premises by reason of School Requirements during the initial term of
this Lease or during the first renewal option period without exercising its
rights under this paragraph to extend the term of the Lease on account of
such capital improvement and thereafter
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Landlord terminates any renewal options available to Tenant under Paragraph
5 of this Lease for the reason and in the manner set forth in that
Paragraph, then Landlord shall pay to Tenant, at the time the then current
term of the Lease expires, the portion of the costs of such capital
improvements which actually remain unamortized by Tenant on such expiration
date, it being understood that Tenant shall have begun to amortize such
costs upon completion of such capital improvements at a rate of $2,000 per
month. (The term "amortization", as used in this Subparagraph (b) of
Paragraph 13, is not intended to refer or relate in any way to the way in
which such capital improvements are treated for tax or accounting purposes
by either Landlord or Tenant.)
(vii) If Tenant exercises its rights to extend the term of the Lease
pursuant to the terms of this paragraph, the Monthly Basic Rental Payments
due during such extension period shall be the Monthly Basic Rental Payments
for the time period applicable to such extension period which are set forth
in Paragraph 6 of this Lease; however, in the event that the term of the
Lease is extended beyond August 31, 2000, the Monthly Basic Rental Payments
for the extension period beyond that date shall be 110% of the Monthly
Basic Rental Payments applicable for the period from September 1, 1995 to
August 31, 2000, plus Escalation Rentals Payments.
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(viii) Insofar as the term "Premises" is used in this Subparagraph
(b) of Paragraph 13, such term shall include the space leased by the Tenant
from the Landlord in the Penn-Sixth-Liberty Garage Building and the cost of
any capital improvements required to be undertaken by the Tenant pursuant
to this Paragraph 13 on account of School Requirements shall be deemed to
include the total aggregate cost of such improvements in both the Xxxxxxx
Building and the Penn-Sixth-Liberty Garage Building.
14. DESTRUCTION OF OR DAMAGE TO THE PREMISES
If, at any time after execution hereof, the Premises are destroyed or
damaged by fire or the elements or by any other cause whatsoever, the Landlord,
at its expense, will restore or rebuild them promptly as nearly as practicable
to the condition existing just prior to such destruction or damage and under
arrangements reasonably satisfactory to the Tenant, except as is otherwise
provided in the following two sentences. The Landlord shall have no obligation
to restore and rebuild the Premises if the Premises are totally or substantially
destroyed by a cause or event (1) which was outside the control of Landlord, (2)
which is outside the usual scope of coverage of a first class fire and casualty
insurance policy with extended coverage, (3) which, in fact, is outside the
scope of Landlord's fire and casualty insurance policy, and (4) which results in
Landlord not otherwise being able to recover its losses as a result of such
destruction of the Premises from some third party or parties. If the
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26
Premises are destroyed or severely damaged as to interfere materially with the
normal use of the Premises by the Tenant during the last two years of the term
of this Lease (including any renewal period if the renewal option under this
Lease has been exercised), then either party may terminate this Lease as of the
date of such damage or destruction by giving written notice to the other party
within thirty (30) days thereafter of its election to do so, unless within such
thirty (30) days the Tenant gives notice of its intention to extend the term or
to renew the Lease in accordance with a renewal option provided for in
Paragraph 5 of this Lease (in which case this Lease will not be terminated
although notice of termination previously may have been given by the Landlord).
If and to the extent to which such destruction or damage materially interferes
with the normal use of the Premises by the Tenant (a) the Tenant will be
entitled to a pro rata abatement of rentals and other monetary obligations of
the Tenant under this Lease until the completion of the restoration and/or
repair work, and (b) the Tenant will have the right at its option to terminate
this Lease by the giving of written notice to the Landlord unless the parties
mutually determine by their reasonable and in good faith agreement that all
necessary restoration and repair work can be substantially completed within One
Hundred and Eighty (180) days after the occurrence of the destruction and/or
damage, and unless the Landlord proceeds diligently with and completes such
restoration and repair work within One Hundred and Eighty (180) days after
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the occurrence of the destruction and/or damage. If the Landlord is unable to
complete such restoration or repairs within 180 days because of strikes,
lockouts, unavailability of materials or other conditions beyond the reasonable
fault and control of the Landlord and of its contractors and agents, the time
for completion will be extended by a period of time equal to the period that
such condition existed, but it will not in any event be extended beyond a date
which is 270 days after the occurrence of the destruction and/or damage.
15. CONDEMNATION
If the Premises or any substantial part thereof are condemned and taken by
right of eminent domain or for public or quasi public use, or if without taking,
substantial consequential damage to the Premises or this Leasehold is caused by
a taking of other property, the Tenant may, at its option, cancel and terminate
this Lease by the giving of written notice to the Landlord at any time within
the period of ninety (90) days following the filing of a declaration of taking,
in which case all unearned rent and all other charges paid by the Tenant in
advance pursuant to this Lease, if any, shall be refunded to the Tenant.
16. DEFAULT BY THE TENANT
(a) DEFINITION OF DEFAULT.
The Tenant will be deemed to be in default under this Lease if and when any
one or more of the following events
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shall occur: (i) the Tenant fails to make payment of any rent, or other charges
required to be paid by the Tenant under this Lease, when due, if such default
continues for a period of five (5) days after written notice by the Landlord to
the Tenant specifying such default; or (ii) the Tenant fails to perform or to
observe any of the other covenants or conditions of this Lease to be kept,
observed or performed by the Tenant, if such default continues for a period of
thirty (30) days after written notice by the Landlord to the Tenant specifying
such default and if the Tenant has not begun diligent and good faith efforts to
remedy such default within the thirty (30) day period and diligently continued
the same thereafter; or (iii) the Tenant is adjudicated as bankrupt or makes an
assignment for the benefit of creditors or has a receiver appointed for its
assets, all whether voluntary or involuntary. A "material default" within the
meaning of subparagraph 16(b) will be any default described in clauses (i) and
(iii) of this subparagraph, or any default described in clause (ii) of this
subparagraph which may have a substantial adverse effect on the property or
interest of the Landlord.
(b) REMEDIES OF THE LANDLORD.
Upon the occurrence of any default by the Tenant, as defined in
subparagraph 16(a), the Landlord may, at its election, (i) take appropriate
corrective actions on behalf of the Tenant to remedy the default (and the Tenant
hereby authorizes the Landlord to enter the Premises to remedy such default),
and thereafter recover from the Tenant all costs
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29
reasonably incurred in connection therewith as additional rent; and (ii)
recover, in an action at law, such damages as may reasonably have been
foreseeable as a consequence of such default, including reasonable attorney's
fees.
In the event of any material default, as defined in subparagraph 16(a), the
Landlord may, in lieu of the remedies provided for in the foregoing clauses (i)
and (ii) of this subparagraph, at its election, terminate this Lease upon the
giving to the Tenant of an additional ten (10) days written notice of its
intention to do so. In that event, and unless the Tenant shall have cured the
material default complained of within that ten (10) day notice period, this
Lease will terminate upon the expiration of that period, and the Tenant
forthwith will surrender the Premises, but will remain liable as hereinafter
provided.
Upon the termination of this Lease under this subparagraph the Landlord
may, at any time thereafter, reenter and resume possession of the Premises and
remove all persons and property therefrom by summary proceedings or by any
suitable action at law or in equity, or by force or otherwise, without being
liable for damages therefor. Reentry by the Landlord will not be deemed an
acceptance or a surrender of this Lease or the Premises. The Tenant will remain
liable for all rent, additional rent and other charges to be paid by the Tenant
as such rent and other charges become due according to the terms of this Lease;
provided however, that the Landlord agrees to use the best
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efforts, in good faith, to relet the Premises on reasonable terms to another
tenant. If and to the extent to which the Landlord relets the Premises, or
uses the same for its own purposes, at any time during the period for which the
Tenant is liable under this Lease, the Tenant will be entitled to a credit
against the amounts due under this Lease equal to (a) the rent and other
charges paid by such other tenants reduced by the commissions and other costs
reasonably incurred by the Landlord in reletting or, (b) if the Landlord is
using the Premises for its own purposes, the net fair rental value of that use.
In the event that this Lease is terminated under the provision of this
subparagraph, the Tenant agrees that any sublease between the Tenant and any
other person which then is in effect will automatically be assigned to the
Landlord as of the effective date of such termination, unless, within five (5)
days following such termination date, the Landlord notifies the Tenant of its
election to refuse such assignments, or any of them; provided, however, that any
rents or other charges paid to Landlord by such sublessee in accordance with the
subleases then in effect will be considered as credits against the Tenant's
obligation in the same manner as if they were payments by a new tenant under the
preceding provision in this subparagraph.
The remedies provided for in this paragraph will be the exclusive remedies
of the Landlord for any default by the Tenant, except as may be expressly
provided elsewhere in this Lease.
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31
17. DEFAULT BY THE LANDLORD
(a) DEFINITION OF DEFAULT.
The Landlord will be deemed to be in default under this Lease if and when
it shall have failed to perform or to observe any covenant or condition of this
Lease to be kept, observed and performed by the Landlord. A "material default"
is any default which has a substantial adverse effect on the property or
interests of the Tenant. Such a default will not be deemed material for
purposes of this paragraph if, within thirty (30) days after receiving notice
thereof, the Landlord shall have taken appropriate and diligent corrective
actions, or shall have commenced such actions and thereafter diligently pursued
them.
(b) REMEDIES OF THE TENANT.
In addition to the remedies provided for specifically in Paragraph 18 of
this Lease, in the event of any default by the Landlord which is not material,
as defined in subparagraph 17(a), the Tenant will have the right (i) after ten
(10) days notice to Landlord of its intention to do so, to take reasonable and
appropriate corrective actions on behalf of the Landlord to remedy the default,
and thereafter to deduct all costs reasonably incurred in connection therewith
from the rental payments otherwise to be made by it under this Lease, provided,
however, that no notice to Landlord shall be required if circumstances compel
immediate action by Tenant; (ii) to recover such damages in action at law as may
reasonably have been foreseeable as a consequence of such default by the
Landlord; and
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(iii) to xxx for specific performance or other appropriate relief, including
costs and reasonable attorney's fees. In the event of any material default by
the Landlord, the Tenant, in addition to the remedies provided for above, shall
have the right at its option to terminate this Lease, upon giving the Landlord
an additional ten (10) days written notice of its intention to do so. In that
event, and unless the Landlord shall have cured the material default complained
of within that ten (10) day notice period, this Lease will terminate upon the
expiration of said period, and the Tenant forthwith shall surrender the
Premises.
18. THE TENANT'S RIGHT TO MAKE PAYMENTS ON BEHALF OF LANDLORD
In addition to any remedies provided for in Paragraph 17 of this Lease, if
the Landlord fails to pay within ten (10) days after due, any installment of
principal or interest on any mortgage paramount to this Lease, or any
installment of taxes or assessments affecting the Premises, or fails promptly to
remove any other lien or charge which reasonably could be expected to jeopardize
the Tenant's immediate right to possession as hereby granted, the Tenant may
after the giving of ten (10) days' prior written notice to the Landlord make
such payment or effect such removal. Any such payment or removal will entitle
the Tenant to be subrogated to the lien or charge of the item so paid in
addition to the rights given the Tenant under this paragraph. If the Tenant
makes any payment or advance or incurs any expense for the account of the
Landlord, pursuant to this Paragraph 18 or to
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any other provision of this Lease, the Tenant will be entitled to receive
prompt reimbursement thereof from the Landlord, together with interest at the
rate of twelve percent (12%) per annum. The Tenant, in addition to its
remedies at law, may apply such claim against any subsequent installment of
rent and, if not reimbursed at the expiration of the term hereby granted or any
extensions thereof, may remain in possession of the Premises until completely
reimbursed.
19. SURRENDER OF PREMISES
Upon the termination of this Lease, the Tenant will vacate and surrender
the Premises to the Landlord in good order and condition, subject only to
reasonable wear and tear, and to fire and casualty damage in accordance with
Paragraph 14, and to the maintenance and other obligations of the Landlord under
the applicable provisions of this Lease.
20. ATTORNMENT
The Tenant agrees that it will attorn to any and all successors in interest
to the Landlord, regardless of the manner in which such succession may arise,
whether by operation of law or by voluntary or involuntary act of the Landlord
or otherwise, provided only that such successors simultaneously agree to accept
and to observe the obligations of the Landlord under this Lease and to assure
the nondisturbance of the Tenant hereunder.
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21. QUIET ENJOYMENT
Upon the payment of the rentals provided for in this Lease and the
compliance by the Tenant with all other terms and conditions hereof, the Tenant
will be entitled to the peaceable and quiet enjoyment of the Premises and of all
the rights and privileges granted to it under this Lease.
22. NAME OF THE BUILDING
Throughout the term of this Lease, the Premises will be known and commonly
identified as the "Art Institute of Pittsburgh" or by such other name as may be
selected for the purposes of the Tenant from time to time with the approval of
the Landlord; such approval shall not be withheld unreasonably.
23. RIGHT OF FIRST REFUSAL TO PURCHASE THE PREMISES
If at any time during the term of this Lease, the Landlord receives (1) a
bona fide offer from any person to purchase the Xxxxxxx Building or any portion
thereof, which the Landlord intends to accept, or (2) a bona fide offer from any
person to purchase as a package the Xxxxxxx Building and the Penn-Sixth-Liberty
Garage Building, which the Landlord intends to accept, the Landlord will send
the Tenant a copy of the proposed contract and will notify the Tenant of the
intention of the Landlord to accept it. The Tenant will have the right, within
thirty (30) days after the delivery of that notice, to accept the terms of the
said contract in its own name or in the name of a nominee, for the gross
purchase price and under the terms
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specified in such bona fide offer, or under other terms and conditions not less
advantageous to the Landlord. If the Tenant does not so elect within that
thirty (30) day period, the Landlord within forty-five (45) days, may enter
into a contract to sell the Premises to the proposed purchaser, provided that
the sale is on terms and conditions and for a price which are essentially the
same as (and are not more favorable to the Purchaser than) the terms,
conditions and price set forth in the proposed contract sent to the Tenant.
24. ASSIGNMENT AND SUBLETTING
(a) ASSIGNMENT OF LEASE.
The Tenant may assign the Lease only if the consent of the Landlord is
first obtained (which consent will not be unreasonably withheld), provided that
(i) the assignee under said assignment assumes all of the obligations of this
Lease, (ii) the Landlord is given a signed copy of the assignment together with
a signed assumption agreement by the new tenant, and (iii) the Tenant will
remain liable under this Lease despite the assignment, unless Tenant
satisfactorily proves to Landlord that the assignee's net worth at the time of
the assignment is equal to or greater than Tenant's net worth.
(b) SUBLETTING.
The Tenant may sublet all or any portion of the Premises if the written
consent of the Landlord is first obtained (which consent will not be
unreasonably withheld), provided that any such subletting will be subject to all
of the terms and
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36
conditions hereof. Such sublettings will not release the Tenant from any of
its obligations under this Lease.
(c) LANDLORD'S CONSENT TO ASSIGNMENTS OR SUBLETTINGS.
The Landlord may not unreasonably withhold its consent to assignments or
sublettings of this Lease. The Landlord agrees that it would not be reasonable
for it to withhold its consent to any assignment or subletting in order to
prevent the Tenant from realizing an appreciation in the value of Tenant's
interest in the Lease. Further, the Landlord agrees that it would not be
reasonable for it to withhold its consent to any assignment or subletting in
order to extract additional money from the Tenant as the price for obtaining the
Landlord's consent, and the Landlord specifically covenants and agrees that it
will not do so. Further, the Landlord agrees that it would not be reasonable
for it to withhold its consent to any assignment or subletting to prevent any of
the following: (1) an assignment or subletting as part of a concession
arrangement between Tenant and a third party for services intended primarily for
the use and benefit of Tenant's students such as, but not limited to, the sale
of books and school supplies or food and beverage services; (2) an assignment or
subletting to any affiliated corporation of the Tenant; (3) an assignment or
subletting of space to any person for professional or business office purposes;
and (4) an assignment or subletting of space for appropriate and lawful types of
wholesale or retail businesses, provided that such businesses are not in
competition with the
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business of another existing tenant of Landlord on the Penn Avenue and Sixth
Street sides of the Penn-Sixth-Liberty Garage Building.
(d) NO ASSIGNMENT OF SUBLEASES.
The Tenant will not assign, pledge or otherwise encumber any interest of
the Tenant in any sublease of any of the Premises or in any rentals due
thereunder.
25. CERTAIN REPRESENTATIONS
(a) REPRESENTATIONS BY THE TENANT.
The Tenant represents and warrants to the Landlord that (i) it is a
corporation duly organized and validly existing in good standing under the laws
of Pennsylvania, (ii) this Lease has been duly authorized by all necessary
corporate action on the part of the Tenant, and (iii) the execution and delivery
of this Lease and the performance by the Tenant of its obligations hereunder
will not conflict with any term of its articles of incorporation or by-laws.
(b) REPRESENTATION BY THE LANDLORD.
The Landlord represents and warrants to the Tenant that (i) the Landlord is
a duly organized and validly existing Pennsylvania limited partnership, (ii) the
Landlord is the sole owner of the building of which the Premises are a part and
has an unrestricted right and power to lease the premises to the Tenant under
this Lease, (iii) this Lease has been duly authorized by all necessary action on
the part of the Landlord, and (iv) the execution and delivery of this Lease and
the performance by the
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Landlord of its obligations hereunder will not conflict with any term of its
partnership agreement or of any other contract or obligation of the Landlord.
26. ELEVATOR SERVICE
Landlord agrees to provide elevator service except on Legal Holidays and
Sundays, as follows:
Freight 1 Elevator Monday through Friday,
7:00 A.M. to 5:00 P.M.
Passenger 2 Elevators Monday through Friday, 7:00 A.M.
to 5:00 P.M. (or to 6:30 P.M. if and when Tenant
adjusts its class schedules to require such service).
1 Elevator Monday through Friday, 5:00 P.M. (or
6:30 P.M. if and when required as indicated above) to
11:00 P.M.
1 Elevator Saturday, 8:00 A.M. to 1:00 P.M.
In addition, upon not less than 24 hours notice from Tenant, Landlord shall
furnish elevator service at other hours provided Tenant shall pay the cost of
furnishing operators for such additional hours.
27. EMERGENCY EXITS
Throughout the term of this Lease, the Landlord at all times will prevent
the emergency exits from the Premises and from the building of which the
Premises is a part and from the adjacent Garage Building from being locked,
chained, or otherwise obstructed in any manner which may prevent the free
passage of persons from the Premises through those exits. Tenant agrees
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that it will endeavor to prevent such emergency exits from being locked,
chained, or otherwise obstructed in any manner.
28. GENERAL PROVISIONS
(a) NOTICES.
Any notice or communication required or contemplated in connection with
this Lease will be in writing and will be conclusively deemed to have been
effectively given if and when delivered or tendered in person or by certified
mail return receipt requested to the appropriate party at the address set forth
below (or at such other address, if any, as may be designated by such party in
writing for that purpose from time to time hereafter). Neither party shall
refuse delivery of any notice.
Landlord: Xxxxxxx & Associates
c/o Realty Growth Corporation
The Roosevelt Building
Sixth and Penn Avenue
Pittsburgh, Pennsylvania 15222
Tenant: Education Management Corporation
000 Xxxxx Xxxxxx
Xxxxxxxxxx, Xxxxxxxxxxxx 00000
Attn: Xxxxxx X. Xxxxxxx
(b) CAPTIONS.
The captions of this Lease are used only for convenience of reference and
will not in any way control or affect the interpretation of any of the
provisions hereof.
(c) INTEGRATION.
This Lease contains the entire agreement of the parties with respect to the
subject matter hereof and supersedes
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any and all prior agreements, understandings or representations of any kind.
It is understood, however, that there is a separate Lease between the parties
of even date with this Lease of a portion of the Building known as the
Penn-Sixth-Liberty Garage Building, which is adjacent to the Xxxxxxx Building
and which connects directly with these Premises in the Xxxxxxx Building.
(d) WAIVERS.
The failure of the Landlord or the Tenant to insist, in any one or more
instances, upon a strict performance of any of the covenants or conditions of
this Lease, or to exercise any option herein contained, will not be construed or
deemed to be a waiver or relinquishment for the future of such covenant,
condition or option, but the same will continue and remain in full force and
effect. No waiver by the Landlord or the Tenant of any provision hereof will be
deemed to have been made, unless expressed in writing and signed by the Landlord
or the Tenant.
(e) TIME OF THE ESSENCE.
Time is of the essence of this Lease.
(f) ASSIGNMENT AND BINDING EFFECT.
In the event of any proper assignment hereunder, the rights, privileges and
obligations of the respective parties will inure to the benefit of and will be
binding upon the parties and their respective successors and assigns, as the
case may be.
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(g) HOLDING OVER.
If the Tenant remains in possession after the expiration of the term of the
Lease, with the Lessor's acquiescence and without any distinct agreement of the
parties with respect to a future extension of this Lease or its replacement by
another lease, the Tenant will be a tenant-at-will, in which event there will be
no renewal of this Lease by operation of law.
(h) APPENDICES.
The appendices to this Lease are as follows:
Appendix A - 8 pages
Appendix B - 1 page
Appendix C - 2 pages
Appendix D - 2 pages
Appendix E - 1 page
Appendix F - 1 page
IN WITNESS WHEREOF, the parties hereto have duly executed this Lease as of
the day and year first above written.
LANDLORD:
WITNESS: XXXXXXX & ASSOCIATES
By
------------------------------- -------------------------------
TENANT
ATTEST: EDUCATION MANAGEMENT CORPORATION
By
------------------------------- -------------------------------
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APPENDIX A
TO LEASE BETWEEN XXXXXXX & ASSOCIATES
AND EDUCATION MANAGEMENT CORPORATION
DATED SEPTEMBER 1, 1978
PART I
1. Replace fire stairwell doors and door frames as required
throughout the Xxxxxxx Building. New panic hardware to be installed throughout.
2. Replace restroom doors and door frames leading into one men's room
and one women's room, to make them wide enough to accommodate wheelchairs of
handicapped persons.
3. Install facilities for handicapped persons in the one men's room
and the one women's room referred to in Paragraph 2, above, including the
installation of one wide stall, one appropriate toilet, and one suitable wash
basin to serve handicapped persons in each of those two restrooms.
4. Replace 27 deteriorated wash basins in toilet rooms of the Xxxxxxx
Building.
5. Install 30 vacuum breakers on toilets in the Xxxxxxx Building, so
as to comply with all applicable health regulations.
6. Replace two water closets with two urinals.
7. Install an emergency generator and associated emergency lighting
facilities and exit signs throughout the Xxxxxxx Building, to comply with
applicable fire regulations.
APPENDIX A
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8. Install a concrete pad for generator, natural gas line, exhaust
and ventilation system.
9. Install emergency lighting facilities and exit signs for first
floor lobby, mezzanine and second floor to comply with applicable fire
regulations.
10. Install panic hardware and door closer on existing B-rated fire
door separating the Xxxxxxx Building and the mezzanine.
11. Install B-rated fire door in the lower lobby ahead of the two
elevator doors and at stairway entrance to the basement. Doors will be equipped
with panic hardware and door closer.
12. Extend the front stairwell down from the second to the first
floor. It will be an open stairway with a B-rated fire door added at the second
floor level into a reception area. The B-rated fire door will be complete with
panic hardware and closer. This contract excludes any structural steel
supports, if required.
13. Remove existing front stairway between the first and second
floors. Close the resulting opening with a steel and concrete floor system.
14. The toilets on floors two, three, five, six, seven, eight, nine
and ten will have seamless epoxy covering added.
APPENDIX A
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15. An electrical holdback system will be added to each of the B-rated
fire doors described in Items 9, 10 and 11, with the exception of the door
leading to the basement. This electromagnetic system will be deactivated by the
current central fire alarm system.
16. Install rubber stair treads on the rear stairs from the first
through the tenth floors.
17. Replace the rubber stair treads on the front stairwell from the
fifth floor down and add rubber to the intermediate platforms on floors one
through five.
18. Exhaust fans will be added to each of the restrooms that do not
have one and the existing exhaust fans will be placed in good operating order.
19. Seal off through the installation of B-rated fire doors and
two-hour fire rated walls, the entranceways to each of the freight elevator
entrances on floors two through ten.
20. Replace all sprinkler heads that are over 50 years old.
21. Replace 32 wooden framed windows in the front of the building.
22. Install flow alarms in the sprinkler system and electrically wire
it into the central alarm system.
23. Resurface the fourth floor men's and women's rooms with new
material selected by the tenant.
APPENDIX A
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24. Add one fire alarm xxxx in the mezzanine to the Xxxxxxx Building
system to meet current fire codes.
25. Recover all steam pipes in classrooms and offices which are
readily accessible to staff and students.
PART II
1. Patch all unnecessary openings in the rear and front stairwells.
2. Install additional lights in the front and rear stairwells.
3. Remove the electric water heater from the rear stairway.
4. Remove water chiller from the rear stairway.
5. Move the fan ventilation units out of the rear stairway and
install per contract documents.
6. Paint all walls and floors of the front stairwell. Deck paint is
to be added to each of the floors.
7. Install lighting in the first floor lobby and elevator lobby.
8. Paint the walls of the first floor lobby in accordance with the
contract documents.
9. Remove terrazzo flooring in first floor lobby as per contract
documents.
10. Install a new ceiling in the first floor lobby as per contract
documents.
APPENDIX A
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11. Install new corridor lights, floors seven and eight, inclusive.
Existing third floor suspended ceiling system will be repaired and lighting
fixtures relocated as per blueprint detail.
12. Paint all walls and ceilings of the corridors and both sides of
the corridor doors and frames with accent colors.
13. Add wall mounted ash receptacles throughout the facility, six per
floor.
14. Move fire alarm station to within 15 feet of the rear stair
entrance on the eighth floor.
15. Reinstall conduit of the alarm on the eighth floor.
16. Paint the ceilings in accordance with the blueprint detail.
17. Renovate mezzanine in accordance with the blueprint detail.
18. Add outlets on the eighth and ninth floors so that there are two
operating outlets in each classroom.
19. Move the sprinkler heads that are in the way of partitions and
sprinkler lines as necessary on the eighth floor.
20. Move the sprinkler heads below the ceiling as required on the
third and fourth floors in accordance with the blueprint detail.
APPENDIX A
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21. On the eighth floor, add partitions and extend the partitions to
the ceiling in accordance with the blueprint detail.
22. On the ninth floor, add partitions as per the blueprint detail.
23. Move the light fixtures on the ninth floor in accordance with
blueprint detail.
24. Move the airbrush lines from the fourth to the fifth floor.
25. Change lay-out of the third and fourth floor classrooms as per
blueprint detail.
26. Change plumbing lines on the fourth floor as per blueprint detail.
27. Change electrical distribution on the third and fourth floors as
per blueprint detail.
28. Change the air distribution system on the third and fourth floors
as per blueprint detail.
29. Paint and highlight classrooms on the eighth and ninth floors in
accordance with blueprint detail. Paint all corridors three through ten.
30. Plaster all wall openings of painted surfaces on floors two
through ten.
31. Plaster all ceiling openings larger than 1/2" diameter on floors
three through nine.
APPENDIX A
- 6 -
48
32. Repair eighth floor acoustical ceiling with tile removed from the
second floor ceiling.
33. Add Xxxxxxxxx Seagate floor covering to Rooms 908 and 909.
34. Add built-ins for the third and fourth floors in accordance with
blueprint detail.
35. Remove all sprinkler pipes on second floor and install new in
accordance with the reflected ceiling plan in blueprint detail.
36. Remove existing second floor partitions and install new in
accordance with blueprint detail. Modify air distribution system in accordance
with blueprint detail.
37. Paint the walls of the second floor.
38. Replace the ceiling tile throughout the second floor, in
accordance with the reflected ceiling plan in the blueprint detail.
39. Install lighting on the second floor in accordance with the
reflected ceiling plan in the blueprint detail.
40. Install electrical outlets and switches in locations shown in the
blueprint detail.
41. Renovate gallery and marketing offices in accordance with the
blueprint detail.
APPENDIX A
- 7 -
49
APPENDIX B
TO LEASE BETWEEN XXXXXXX & ASSOCIATES
AND EDUCATION MANAGEMENT CORPORATION
DATED SEPTEMBER 1, 1978
1. Insulate suspended ceiling of mezzanine; insulate duct work; and
modify duct work in accordance with plans supplied by Klaus Associates.
One-third of the expense is to be paid by the tenant.
2. Seal roof (parking ramp) of mezzanine area to stop water seepage.
3. Seal windows of mezzanine area to stop water seepage.
4. Replace defective compressor in mezzanine air conditioning with a
Carrier unit.
5. Purchase back-up motor for water circulation pump to cooling tower
on roof.
6. Repair circulation pump referred to in Item 5.
7. Install by-pass and flow-control valves on the cooling tower
system.
8. Add a steam coil in place of the resistive heating unit on the
mezzanine.
9. Install automatic steam valve in basement of Xxxxxxx Building.
10. Provide lounge for elevator operators in basement.
11. Purchase back-up gear box for the cooling tower.
APPENDIX B
- 1 -
50
APPENDIX C
TO LEASE BETWEEN XXXXXXX & ASSOCIATES
AND EDUCATION MANAGEMENT CORPORATION
DATED SEPTEMBER 1, 1978
The services which Tenant will provide for maintaining the Cooling Tower
installation are as follows:
1. Total start up of the cooling tower system at the start of the air
conditioning season. This includes, but is not limited to, cleaning the tower
and its reservoir, flushing the entire circulation system, repacking the moving
parts, and adding the necessary chemicals to the system.
2. Monthly check out of the system, including cleaning those items
which show an unusual collection of debris and dirt, and lubricating all moving
parts.
3. Draining, flushing, hosing down and refilling the system with
water and chemicals twice during the cooling season.
4. Adding chemicals as required, and sending samples of the solution
to a lab for verification of the proper balance at start up, after each refill,
and once between each refill for a total of six tests during a season.
Additionally, in-house chemical balance checks will be made five days per week
during the air-conditioning season.
5. Changing the gear box oil twice a season.
6. Packing the pump at the start of the season and as required during
the season.
APPENDIX C
- 1 -
51
7. Total shutdown of the system at the end of the season. This
includes, but is not limited to, draining and flushing the system, draining all
supply lines, and disabling the automatic control device to prohibit false
operation of the system.
Tenant's maintenance responsibilities for the Cooling Tower installation
will not cover the cost of any parts nor the labor to install such parts beyond
the items specifically described above.
XXXXXXXX X
- 0 -
00
XXXXXXXX X
TO LEASE BETWEEN XXXXXXX & ASSOCIATES
AND EDUCATION MANAGEMENT CORPORATION
DATED SEPTEMBER 1, 1978
The costs with respect to the elevators which will be taken into account in
calculating Escalation Rental Payments are limited to:
A. The Actual cost of the inspection, adjustment and lubrication of
the elevators as required, including periodical examination of all safety
devices and governors, checking and equalizing tensions of all hoisting ropes,
lubricating guide rails properly (except where roller guides are used) and
maintaining accessory equipment.
B. The actual cost, if required, of repairing, renewing or replacing
the following:
1. Elevator Machine
2. Elevator Motor
3. Generator
4. Controller Parts
5. Gears
6. Worms
7. Bearings
8. Rotating Elements
9. Thrusts
10. Brake Magnet Coils
11. Brake Magnet Stators
APPENDIX D
- 1 -
53
12. Brake Shoes and Linings
13. Commutators and Brushes
14. Windings and Coils
15. Contacts and Magnet Frames
16. Resistance for Motor and Operator Circuits
17. Renewing Ropes
18. Conductor Cables
19. Renewing Guide Shoe Gibs or Rollers (when necessary for smooth
and quiet operation)
20. Damage to the Doors and Cabs of the Elevators if caused by
Tenant or Tenant's students.
APPENDIX D
- 2 -
54
APPENDIX E
TO LEASE BETWEEN XXXXXXX & ASSOCIATES
AND EDUCATION MANAGEMENT CORPORATION
DATED SEPTEMBER 1, 1978
The following drawings prepared by Klaus Associates show
substantially all of the work listed in Appendices A, B and F to this Lease.
All drawings show the number "78-6" and are dated "7-5-78." When the drawings
have been revised, those revisions are indicated.
A1 Revised 11-17-78
A2A Revised 8-23-78, 8-25-78, 9-14-78
A2 Revised 10-9-78, 2-22-79
A2E Revised 8-8-78, 8-22-78, 8-25-78
A3 Revised 8-9-78, 10-23-78
A4 Revised 8-9-78, 9-14-78
A5 Revised 9-14-78
A6 Revised 9-14-78
A7 Revised 9-14-78
A8 Revised 9-14-78
A9 Revised 8-25-78, 9-14-78, 10-6-78
X00 Xxxxxxx 00-00-00
X00
X00 Revised 0-0-00
XXXXXXXX X
- 0 -
00
XXXXXXXX F
TO LEASE BETWEEN XXXXXXX & ASSOCIATES
AND EDUCATION MANAGEMENT CORPORATION
DATED SEPTEMBER 1, 1978
1. Install new corridor lights, floors four, five, six and nine.
2. Remove all wooded baseboards in corridors, third floor through tenth
floor, and install carpet and rubber base. (Also includes mezzanine
halls.)
3. Install new lighting fixtures with individual room switches in eighth
floor classrooms.
4. Install 4'x 5' homasote boards covered with material and framed in
locations shown in drawing details.
5. Install tack strips in each of the rooms in the locations and
quantities shown in the drawing details.
6. Furnish air conditioning for computer room in accordance with drawing
detail.
7. Install new carpeting throughout second floor.
8. Install rolling screen counter doors for security purposes in the
accounting office and photo supply store.
APPENDIX F
- 1 -
