FIRST AMENDMENT TO SUBLEASE
FIRST
AMENDMENT TO SUBLEASE
AGREEMENT, dated as of the 3rd day of August, 2006, between
BKF MANAGEMENT CO., INC., having its principal office at
Xxx Xxxxxxxxxxx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000 (hereinafter
called “Sublandlord”), and DAYLIGHT FORENSIC
AND ADVISORY LLC, having an office at Xxx Xxxxxxxxxxx Xxxxx,
Xxx Xxxx, Xxx Xxxx 00000 (hereinafter called
“Subtenant”).
W I T N E S
S E T H:
WHEREAS:
1. Sublandlord and Subtenant executed that certain sublease
dated as of May, 2006 (hereinafter called the
“Sublease”), covering the entire eighteenth
(18th) floor (hereinafter called the “Present
Premises”), in the building known as Xxx Xxxxxxxxxxx
Xxxxx, Xxx Xxxx, Xxx Xxxx (hereinafter called the
“Building”), for a term expiring on
September 29, 2011, which Sublease was approved by Master
Landlord pursuant to Consent to Sublease dated May 31, 2006
among Master Landlord, Sublandlord and Subtenant; and
2. The parties now desire to amend the Sublease by adding
additional space to the Present Premises, and in other respects
as hereinafter provided.
3. As used herein, the term “Sublease” shall mean
the Sublease as amended by this First Amendment to Sublease.
NOW, THEREFORE, in consideration of the mutual covenants herein
contained, it is agreed as follows:
FIRST: Unless the context otherwise
clearly indicates a contrary intent or unless specifically
provided herein, each term used in this Agreement which is
defined in the Sublease shall be deemed to have the meaning
ascribed to such term in the Sublease.
SECOND: The Sublease is hereby amended,
effective as of the date which is the latest to occur of
(a) the date of execution and delivery of this Sublease by
Sublandlord and Subtenant, (b) the date of
Sublandlord’s receipt of the Master Landlord Consent (as
defined in Article NINTH hereof)with respect to this First
Amendment to Sublease, (c) the tendering of delivery of
possession of the Additional Premises (as hereinafter defined)
to Subtenant vacant and in broom clean condition, or such
earlier date upon which Subtenant shall take possession of the
Additional Premises (hereinafter called the “Additional
Premises Commencement Date”), so that the Present
Premises shall include the entire nineteenth (19th) floor of the
Building which, notwithstanding anything to the contrary
contained in the Sublease or Master Lease, Sublandlord and
Subtenant agree shall be deemed to consist of
17,054 rentable square feet for purposes of the Sublease
(hereinafter called the “Additional Premises”).
Tenant shall use and occupy the Additional Premises from and
after the Additional Premises Commencement Date under the same
terms, covenants and conditions as provided in the Sublease
(including, without limitation, Articles XIII and XVI
thereof), as herein amended.
THIRD: Effective from the Additional
Premises Commencement Date:
1. The “Subleased Premises”, as said term is
defined in the Sublease, shall mean collectively the Present
Premises together with the Additional Premises, except as
hereinafter provided;
2. The “Fixed Rent”, as said term is defined in
the Sublease, shall be modified such that the Fixed Rent payable
under the Sublease shall be increased by NINE HUNDRED
THIRTY-SEVEN THOUSAND NINE HUNDRED SEVENTY AND 00/100
($937,970.00) DOLLARS per annum ($78,164.16 per month) (the
“Additional Premises Fixed Rent”) for the
remainder of the term of the Sublease;
3. Section 13.01 of the Sublease captioned
“Escalations” is hereby amended with respect solely to
the Additional Premises such that Subtenant covenants and agrees
to pay Sublandlord as Additional Rent during the term of the
Sublease all additional rent payable pursuant to subdivision
(v) of Section 3(b) of the Second Amendment except
that for purposes of the Sublease, (i) the term
“Base Real Estate Taxes” shall mean the R. E.
Tax Share of Real Estate Taxes for the Tax Year beginning on
July 1, 2006 and ending on June 30, 2007, and
(ii) the term “Base COM” shall mean the
O.E. Share of the Cost of Operation and Maintenance for the
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Computation Year beginning on January 1, 2006 and ending on
December 31, 2006. For purposes of the Sublease with
respect to the Additional Premises, the term “Tenant
Area” shall mean 17,054 rentable square feet
notwithstanding anything to the contrary set forth in the Second
Amendment or the Master Lease. All such payments shall be made
by Subtenant at least three (3) days prior to the date such
payment is required to be made by Sublandlord to Master Landlord
but subject to the provisions of the last sentence of
Section 6.02 of the Sublease. With respect to the
Additional Premises, whenever the term “Tenant Area”
appears in the Master Lease and is incorporated by reference
into the Sublease, “Tenant Area” shall be deemed to
mean 17,054 rentable square feet. It is the intent of the
parties that all Additional Rent payable by Subtenant pursuant
to Article XIII of the Sublease shall be payable with
respect to both the Present Premises and the Additional
Premises. In the event Master Landlord credits Sublandlord for
any amounts charged in previous periods occurring during the
term of the Sublease with respect to the Additional Premises for
Operating Expenses or Taxes or other Additional Rent items under
the Master Lease, then, provided Subtenant has paid the amount
so credited, Sublandlord shall (i) provide Subtenant with a
copy of the supporting documentation received by Sublandlord and
(ii) give to Subtenant a credit or refund equal to
Subtenant’s allocable share of the portion of such credit
or refund.;
4. The electric energy to the Additional Premises shall be
furnished pursuant to, and subject to, the provisions of
Section 3(b) (ix) of the Second Amendment and the
other provisions of the Master Lease as they relate to the
Additional Premises. Sublandlord shall not be liable in any way
to Subtenant for any failure or defect in the supply or
character of electric energy furnished to the Additional
Premises except to the extent such failure or defect arises as a
result of Sublandlord’s gross negligence or willful
misconduct; and
5. Sections 6.04 and 6.05 of the Sublease shall not
apply to the Additional Premises Fixed Rent. Provided Subtenant
is not then in default under the terms, covenants and conditions
of the Sublease following notice and expiration of applicable
cure periods provided therein, Subtenant shall have the right to
use and occupy the Additional Premises free solely of the
Additional Premises Fixed Rent during (i) the six
(6) month period commencing on the Additional Premises
Commencement Date and (ii) the five (5) month period
commencing on the one (1) year anniversary of the
Additional Premises Commencement Date (the “Free Fixed
Rent Periods”), except that during such period,
Subtenant shall pay to Sublandlord all Additional Rent and other
charges due during the above period. Except for the free Fixed
Rent allowance as herein provided, Subtenant shall use and
occupy the Additional Premises during the Free Fixed Rent
Periods pursuant to all of the other terms, covenants and
conditions of the Sublease.
FOURTH: 1. Article VIII of
the Sublease shall not apply to the Additional Premises.
Subtenant acknowledges that Subtenant has fully inspected the
Additional Premises and Subtenant agrees to accept possession
thereof in its then “as-is” physical condition on the
Additional Premises Commencement Date, including, without
limitation, all existing partitions and without any furniture,
furnishings or other personal property except as set forth in
Article SIXTH hereof, and with all fixtures, equipment,
improvements and appurtenances attached to or built into the
Additional Premises on the Additional Premises Commencement Date
(including, without limitation, any “built-ins”,
carpeting, paneling, fixtures, partitions, equipment, lighting
fixtures, doors, wall treatments, window treatments and
shelving), all of which shall remain a part of the Additional
Premises.
A. It is understood and agreed that Sublandlord shall not
be required to make any improvements, alterations or repairs
whatsoever to the Additional Premises or incur any expense to
prepare the Additional Premises for Subtenant’s occupancy
thereof, except that Sublandlord shall deliver the Additional
Premises in vacant, broom clean condition free of all tenancies
and occupancies (other than Sublandlord’s tenancy under the
Master Lease).
2. A. In making and executing this First Amendment to
Sublease, Subtenant has not relied upon or been induced by any
statements or representations (except as otherwise expressly
provided in this First Amendment to Sublease) of any persons
with respect to the Additional Premises or of any other matter
affecting the Additional Premises or this transaction which
might be pertinent in considering the leasing of the Additional
Premises or the execution of this First Amendment to Sublease.
Subtenant acknowledges that Sublandlord has afforded Subtenant
the opportunity for full and complete investigations,
examinations and inspections.
3. A. Subtenant shall, at Subtenant’s expense, perform
all of the work and installations necessary for Subtenant’s
initial occupancy of the Additional Premises (the
“Initial Work”) subject to the provisions of
the
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Sublease, including, without limitation, Sublandlord’s and
Master Landlord’s prior written approval thereof. Subtenant
agrees that it will, prior to the commencement of any work in
the Additional Premises, deliver to Sublandlord all certificates
of insurance required to be supplied to Sublandlord by Subtenant
pursuant to the terms of the Sublease.
B. 1. In consideration of Subtenant performing and
completing all of the Initial Work in the entire Additional
Premises, Sublandlord shall, subject to the terms and conditions
of Section B.3 of this Article, reimburse or cause to be
reimbursed to Subtenant, an amount equal to the lesser of
(i) the actual cost of the labor, materials and any other
hard costs or reasonable soft costs incurred (including, without
limitation, engineering, architectural and consulting fees) in
connection with the installation of the physical improvements
comprising the Initial Work, or (ii) ONE HUNDRED SEVENTY
THOUSAND FIVE HUNDRED FORTY AND 00/100 ($170,540.00) DOLLARS,
representing “Sublandlord’s Contribution”
to such work, it being understood and agreed that
Sublandlord’s Contribution shall not exceed such sum, and
that all costs and expenses in excess of said sum shall be borne
solely by Subtenant.
2. Provided Subtenant is not in default under the Sublease
following notice and expiration of applicable cure periods
provided herein, Sublandlord’s Contribution as provided in
Paragraph B.2 hereof shall be paid out from time to time
upon written request of the Chief Financial Officer or
equivalent officer of Subtenant (the “Request”)
as the Initial Work progresses, but not more frequently than
monthly and which payment by Sublandlord shall be made on a pari
passu basis, along with payments for the Initial Work to be paid
by Subtenant hereunder, such that the proportion to be paid by
Sublandlord of the cost of the work then performed to date shall
in no event exceed the ratio that the total Sublandlord’s
Contribution bears to the total projected cost of the Initial
Work. Any such Request shall be received no later than nine
(9) months following the Additional Premises Commencement
Date and shall be accompanied by the following:
(a) copies of all receipts, invoices and bills for the work
completed and materials furnished in connection with the Initial
Work and incorporated in the Additional Premises which are to be
paid from the requested disbursement or which have been paid by
Subtenant and for which Subtenant is seeking reimbursement;
(b) copies of all work orders, change orders and other
materials relating to the work or materials, if any, which are
the subject of the requested reimbursement;
(c) a certificate signed by Subtenant’s independent
licensed architect, dated not more than ten (10) days prior
to such Request, setting forth the following:
(i) that the sum then requested is justly due to persons
who have rendered services or furnished materials for the work
therein specified, and giving a brief description of such
services and materials and the several amounts due to each of
said persons in respect thereof, and stating that no part of
such expenditure is being made the basis, in any previous or
then pending prior request, for the receipt of
Sublandlord’s Contribution or has been made out of the
proceeds of Sublandlord’s Contribution received by
Subtenant, that the sum then requested does not exceed the value
of the services and materials described in the certificate, and
that, in his opinion, the portion of the Initial Work
theretofore completed was performed in a good and workmanlike
manner and substantially in accordance with the plans therefor;
(ii) that except for the sum then requested, there is no
outstanding indebtedness (except for withholding of ten (10%)
percent retainages) known to the persons signing such
certificate, which is then due for labor, wages, materials,
supplies or services in connection with the Initial Work which,
if unpaid, might immediately become the basis of a
vendor’s, mechanic’s, laborer’s or material
man’s statutory or similar lien upon such work or upon the
land and building or any part thereof or upon Subtenant’s
leasehold interest;
(iii) a good faith estimate of the percentage of the
Initial Work theretofore completed; and
(d) waivers of lien from all contractors, subcontractors
and materialmen involved in the performance of the Initial Work
relating to the portion of the Initial Work theretofore
performed and materials theretofore
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provided and for which previous disbursements
and/or the
requested disbursement has been or is to be made (except to the
extent such waivers of lien were previously furnished to
Sublandlord).
Subject to the provisions of Paragraph B.2 hereof, upon
compliance with the foregoing provisions of this
Xxxxxxxxx X.0, Xxxxxxxxxxx shall pay or cause to be paid to
Subtenant or the persons named (pursuant to
subdivision (c)(i) of this Section) in such certificate,
the respective amounts stated therein to be due to them provided
(less ten (10%) percent of such sum as retainage), provided
however, that Sublandlord’s Contribution shall not exceed
ONE HUNDRED SEVENTY THOUSAND FIVE HUNDRED FORTY AND 00/100
($170,540.00) DOLLARS, and that all costs and expenses in excess
of said sum shall be borne solely by Subtenant.
FIFTH: Upon Subtenant’s execution
of this First Amendment to Sublease, Subtenant shall deliver to
Sublandlord a letter of credit in the amount of $511,620.00 to
be held by Sublandlord pursuant to the terms of the Sublease as
additional security for the faithful performance and observance
by Subtenant of the terms, provisions and conditions of the
Sublease (the “Additional Security”). Provided
Subtenant shall not then be in default under any of the terms,
covenants and conditions of the Sublease, and provided further
that at no time shall Sublandlord have drawn down on any
security deposit or letter of credit theretofore maintained
under the Sublease as permitted under the Sublease, then, upon
written notice to Sublandlord, the amount of Additional Security
required to be deposited under the Sublease or LC Amount may be
reduced after the dates and to the amounts as follows:
(i) After the date that is twelve (12) months
following the day immediately succeeding the last day of the
initial Free Fixed Rent Period pursuant to Section 5 of
Article THIRD of this First Amendment to Sublease (the
“1st Reduction Date”), to $383,715.00;
(ii) After the date that is twelve (12) months
following the 1st Reduction Date, to $255,810.00 (the
“2nd Reduction Date”); and
(iii) After the date that is twelve (12) months
following the 2nd Reduction Date and for the balance of the
term of the Sublease, to $127,905.00.
It is agreed that the security
and/or LC
Amounts required to be maintained pursuant to this
Article FIFTH are (and shall remain) in addition to the
security
and/or LC
Amounts required to be maintained pursuant to Article XXV
of the Sublease prior to this First Amendment to Sublease.
SIXTH: 1. Sublandlord’s
office furniture and equipment listed on
Exhibit “A” annexed hereto and made a part hereof
(the “Office Furniture and Equipment”) shall
remain in the Additional Premises pursuant to the provisions of
this Article. In consideration of the execution and delivery of
this First Amendment to Sublease by Subtenant, Sublandlord
hereby conveys to Subtenant and Subtenant hereby accepts all of
Sublandlord’s right, title and interest in and to the
Office Furniture and Equipment. Such conveyance is made with no
recourse, warranty or representation of any nature whatsoever,
express or implied, including any warranty of fitness for any
particular purpose, except that Sublandlord hereby represents
and warrants that such Office Furniture and Equipment is owned
by Sublandlord free and clear and is not subject to any liens or
encumbrances and that no third party has any rights in and to
such Office Furniture and Equipment.
2. Subtenant acknowledges that it has inspected the Office
Furniture and Equipment, is familiar with its condition and
accepts the same in its “as-is” physical condition as
of the Additional Premises Commencement Date. Except as
otherwise set forth herein, neither Sublandlord nor any agent or
representative of Sublandlord has made any express or implied
warranties, guaranties, inducements, representations or
information pertaining to the Office Furniture and Equipment or
any part thereof, the physical condition, the uses which can be
made of same or any other matter or thing with respect thereto.
Subtenant shall remove all of the Office Furniture and Equipment
from the Subleased Premises on or before the Expiration Date or
the sooner termination of the Sublease.
3. Subtenant shall obtain and keep in full force and effect
at all times during the term of the Sublease insurance policies
in accordance with the terms of the Master Lease, which
insurance policies, in addition to the requirements set forth in
the Master Lease, shall name Sublandlord as an additional
insured.
4. Subtenant agrees to pay any applicable sales and use
taxes arising out of or in connection with the conveyance of the
Office Furniture and Equipment to Subtenant.
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SEVENTH: If Sublandlord is unable to
give (or delayed in giving ) possession of the Additional
Premises to Tenant on the Additional Premises Commencement Date
because of the holding-over or retention of possession of any
tenant, undertenant or occupants, or for any other reason,
Sublandlord shall not be subject to any liability for failure to
give possession on said date and the validity of this First
Amendment to Sublease and the Sublease shall not be impaired
under such circumstances, nor shall the same be construed in any
way to extend the term of the Sublease, but the Additional
Premises Commencement Date shall be deemed extended until the
date on which Sublandlord shall have tendered delivery of
possession thereof to Subtenant (provided Subtenant is not
responsible for the inability to obtain possession). The
provisions of this Paragraph are intended to constitute “an
express provision to the contrary” within the meaning of
Section 223-a
of the New York Real Property Law. In the event that Sublandlord
does not deliver possession of the Additional Premises by the
date that is sixty (60) days following the date of
execution and delivery of this First Amendment to Sublease by
Sublandlord and Subtenant and execution and delivery of the
Master Landlord Consent by the parties thereto (the
“Deadline Date”), then the Free Fixed Rent
Period set forth in subdivision (i) of Section 5 of
Article Third of this First Amendment to Sublease shall be
extended one (1) day for each day following the Deadline
Date that the Additional Premises are not delivered until the
date Sublandlord delivers possession of the Additional Premises.
The foregoing extension of the Free Fixed Rent Period shall be
Subtenant’s exclusive remedy with respect to the failure
(or delay) to deliver the Additional Premises.
EIGHTH: Notwithstanding anything to
the contrary contained in the Sublease, Article VIII of the
Sublease is hereby amended by deleting Section 8.01B
(i) and Section 8.02B thereof and Subtenant
acknowledges that Sublandlord has no obligation to enclose the
internal stairway leading from the Present Premises to the
Additional Premises or perform any other work in connection
therewith.
NINTH: Subtenant warrants and
represents that (a) it dealt with no broker in consummating
this First Amendment to Sublease, and (b) no conversations
or prior negotiations were had with any broker concerning the
renting of the Additional Premises other than Xxxxxxx &
Xxxxxxxxx, Inc. and Colliers ABR, Inc. (collectively,
“Brokers”). Sublandlord warrants and represents
that (a) it dealt with no broker in consummating this First
Amendment to Sublease, and (b) no conversations or prior
negotiations were had with any broker concerning the renting of
the Additional Premises to Subtenant other than the Brokers.
Subtenant agrees to indemnify and hold Sublandlord harmless
against any claims, losses, damages, judgments, costs and
expenses (including reasonable attorneys’ fees and
disbursements) arising out of any breach of its foregoing
representations. Sublandlord agrees to indemnify and hold
Subtenant harmless against any claims, losses, damages,
judgments, costs and expenses (including reasonable
attorneys’ fees and disbursements) arising out of any
breach of its foregoing representations. Commission, if any,
payable to Brokers shall be paid by Sublandlord.
TENTH: This First Amendment to Sublease
shall not become effective unless and until the written consent
of the Master Landlord to this First Amendment to Sublease,
which consent shall include, in substance, an agreement by
Master Landlord to recognize Subtenant under the terms of the
Sublease in the event of a termination of the Master Lease by
reason of a default thereunder by Sublandlord or voluntary
termination of the Master Lease except in certain circumstances,
subject to the terms of such consent (the “Master
Landlord Consent”) has been obtained in form and
substance reasonably acceptable to Sublandlord and Subtenant,
and a copy of the fully executed Master Landlord Consent has
been delivered to Sublandlord and Subtenant. Promptly following
execution and delivery of this First Amendment to Sublease by
Sublandlord and Subtenant, Sublandlord shall request the Master
Landlord Consent. If the written Master Landlord Consent to this
First Amendment to Sublease shall not be obtained on or before
forty-five (45) days following execution of this First
Amendment to Sublease by Sublandlord and Subtenant, then
Sublandlord and Subtenant shall each have the right to terminate
this First Amendment to Sublease upon ten (10) days’
prior written notice to the other party and unless the Master
Landlord Consent is obtained within said ten (10) day
period, this First Amendment to Sublease shall be of no further
force or effect and shall be deemed null and void ab
initio, and neither Sublandlord nor Subtenant shall have
any liability hereunder, except that Sublandlord shall promptly
return any Additional Premises Fixed Rent and security deposit
delivered by Subtenant to Sublandlord pursuant to this First
Amendment to Sublease; but the Sublease in effect prior to this
First Amendment to Sublease shall remain in full force and
effect and may not be terminated if the Master Landlord Consent
to this First Amendment to Sublease is not obtained.
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Subtenant hereby agrees that it shall cooperate in good faith
with Sublandlord and shall comply with any reasonable requests
made of Subtenant by Master Landlord in the procurement of the
Master Landlord Consent.
ELEVENTH: Subject to the provisions of
the Sublease and Master Lease, including, without, limitation,
Article XV of the Sublease and Section 7.4 of the
Master Lease, at Subtenant’s request, Sublandlord shall
request Master Landlord maintain listings (pursuant to
Section 7.4 of the Master Lease) on the Building directory
of the names of Subtenant and the names of any officers or
employees of Subtenant; provided, however, that the number of
names so listed shall be in the same proportion to the number of
listings to which Tenant is entitled under the Master Lease as
the aggregate number of square feet of rentable area of the
Subleased Premises is to the aggregate number of square feet of
rentable area of the Premises. Any amounts payable to Master
Landlord for such listings shall be payable by Subtenant as a
Subtenant Surcharge.
TWELFTH: This First Amendment to
Sublease is being tendered to Subtenant without obligation on
Sublandlord’s part and in no event shall it be deemed to be
binding on Sublandlord or give Subtenant any rights unless and
until Sublandlord shall have executed the same and delivered a
copy to Subtenant.
THIRTEENTH: This Agreement may not be
changed, modified or cancelled orally. Except as hereinabove
modified and amended, and as so modified and amended, the
Sublease is hereby ratified and confirmed in all respects and
shall be binding upon the parties hereto and their respective
successors and permitted assigns.
IN WITNESS WHEREOF, the parties hereto have hereunto set their
hand and seals as of the day and year first above written.
BKF MANAGEMENT CO., INC., Sublandlord
| By: |
/s/ X.
Xxxxxx Xxxx
|
Name: X. Xxxxxx Xxxx
| Title: CFO |
DAYLIGHT FORENSIC AND ADVISORY LLC, Subtenant
| By: |
/s/ Xxxxx
Xxxxxxx
|
Name: Xxxxx Xxxxxxx
| Title: CEO |
0
|
XXXXX XX XXX XXXX
|
) | |||
| : | ss.: | |||
|
COUNTY OF NEW YORK
|
) |
On
the
day
of
in the year 2006 before me, the undersigned, a Notary Public in
and for said State, personally
appeared ,
personally known to me or proved to me on the basis of
satisfactory evidence to be the individual(s) whose name(s) is
(are) subscribed to the within instrument and acknowledged to me
that he/she/they executed the same in his/her/their
capacity(ies), and that by his/her/their signature(s) on the
instrument, the individual(s), or the person upon behalf of
which the individual(s) acted, executed the instrument.
/s/ Notary
Public
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EXHIBIT
“A”
All built-in furniture currently located in the Additional
Premises
All Conference Room Furniture currently located in the
Additional Premises
All other moveable furniture to the extent remaining in the
Additional Premises on the
Additional Premises Commencement Date, in Sublandlord’s
sole discretion.
A-1
