New York-New York-8-10 East 40th Street Sublease - HSBC Bank USA and Marvel Enterprises Inc.
SUBLEASE
THIS SUBLEASE, dated as of the 9th day of June, 2000, is between HSBC
BANK USA, a bank organized under the laws of the State of New York, having an
office a 140 Broadway, New York, NY 10005 ("Sublessor") and MARVEL ENTERPRISES,
INC., a Delaware corporation, having an office at 387 Park Avenue South, New
York, NY 10016 ("Subtenant").
WITNESSETH:
1. DEMISE AND TERM. Sublessor leases to Subtenant, and
Subtenant hires from Sublessor, certain premises identified as Room 801, 9th
Floor, 10th Floor, 11th Floor, Room 1206 and Room 1208 as identified on Schedule
A attached hereto and made a part hereof (collectively, the "Subleased
Premises") located in the building ("Building") known as 8-10 East 40th Street,
New York, NY and being a portion of the premises which were leased to Sublessor
under the Main Lease (as hereinafter defined). The term of this Sublease (the
"Sublease Term") shall be the period: (a) commencing on the date Sublessor
tenders possession of the Subleased Premises to Subtenant, which is anticipated
to be on or about January 1, 2001 (the "Commencement Date"), and (b) ending at
midnight on July 31, 2006 unless sooner terminated as herein provided (the
"Termination Date"). Sublessor shall give Subtenant notice of the date of
possession, if other than January 1, 2001, at least ten (10) days prior thereto.
If the Commencement Date does not occur by May 1, 2001, then either party may,
upon at least ten (10) days prior written notice to the other party, elect to
terminate this Sublease (provided however, that Sublessor may void any such
termination notice given by Subtenant by tendering possession of the Subleased
Premises to Subtenant prior to the expiration of such ten (10) day period).
2. SUBORDINATE TO MAIN LEASE. This Sublease is and shall be
subject and subordinate to the lease dated as of December 14, 1992, a
modification dated October 20, 1993, a supplement dated December 10, 1993, a
second modification dated October 22, 1993, a third modification dated January
28, 1994, a fourth modification dated December 29, 1993, a fifth modification
dated June 20, 1994, a sixth modification dated April 14, 1997, a seventh
modification dated May 14, 1997 and an eighth modification dated November 11,
1997 (collectively, the "Main Lease") all between The Ronbet Company
("Overlandlord"), as landlord, and Sublessor, as tenant, and to the matters to
which the Main Lease is or shall be subject and subordinate. Subtenant
acknowledges that a copy of the Main Lease has been delivered to and examined by
Subtenant.
3. INCORPORATION BY REFERENCE. (a) The terms, covenants and conditions
of the Main Lease are incorporated herein by reference so that, except to the
extent that they are inapplicable , excluded or are modified by the provisions
of this Sublease. For the purpose of incorporation by reference, each and every
term, covenant and condition of the Main Lease binding on or inuring to the
benefit of the landlord thereunder shall, in respect of this Sublease, bind or
inure to the benefit of Sublessor, and each and every term, covenant and
condition of the Main Lease binding on or inuring to the benefit of the tenant
thereunder shall, in respect of this Sublease, bind or inure to the benefit of
Subtenant, with the same force and effect as if such terms, covenants and
conditions were completely set forth in this Sublease, and as if the words
"Owner" and "Tenant," or words of similar import, wherever the same appear in
<PAGE>
the Main Lease, were construed to mean, respectively, "Sublessor" and
"Subtenant" in this Sublease, and as if the words "Demised Premises," or words
of similar import, wherever the same appear in the Main Lease, were construed to
mean "Subleased Premises" in this Sublease, and as if the word "Lease," or words
of similar import, wherever the same appear in the Main Lease, were construed to
mean this "Sublease".
(b) Notwithstanding anything to the contrary contained in this
Sublease, all provisions in the Main Lease which either are inapplicable to the
Subleased Premises by their terms or provide for (i) termination, expansion or
extension options, (ii) tenant improvement work or work allowances or credits,
(iii) rent credits, abatements, offsets or waivers, (iv) the right to install a
concierge desk, emergency generator, or roof top antennae or satellite dish, (v)
the right to discontinue cleaning services or electricity service, or (vi)
exclusive elevator usage, are not incorporated in this Sublease. Furthermore,
the specific provisions of the Main Lease listed on Schedule B attached hereto
and made a part hereof are not incorporated in this Sublease. All
representations or warranties made by Overlandlord in the Main Lease shall be
deemed made only by Overlandlord. Subtenant shall be entitled to the services
and repairs which Overlandlord is obligated to furnish or make to or in the
Subleased Premises pursuant to the terms of the Main Lease. The time limits
contained in the Main Lease for the giving of notices, making of demands or
performing of any act, condition or covenant on the part of the tenant
thereunder, or for the exercise by the tenant thereunder of any right or remedy,
are changed for the purposes of incorporation herein by reference by shortening
the same in each instance by three (3) days, so that in each instance Subtenant
shall have three (3) days less time to observe or perform hereunder than
Sublessor has as the tenant under the Main Lease. Sublessor shall promptly
furnish Subtenant with a copy of any bill, statement or notice received from
Overlandlord relevant to Subtenant's interest in the Subleased Premises,
including any notices of default or termination. If any express provision of
this Sublease shall conflict with any of the provisions incorporated by
reference, such conflict shall be resolved in every instance in favor of the
express provisions of this Sublease.
4. PERFORMANCE BY SUBLESSOR. Any obligation of Sublessor which is
contained in this Sublease by the incorporation by reference of the provisions
of the Main Lease may be observed or performed by Sublessor using its best
efforts (at the sole cost and expense of Subtenant) to cause Overlandlord to
observe and/or perform the same, and Sublessor shall have a reasonable time to
enforce its rights to cause such observance or performance. Sublessor shall not
be required to furnish, supply or install anything required to be furnished,
supplied or installed by Overlandlord under any article of the Main Lease.
Subtenant shall not in any event have any rights in respect of the Subleased
Premises greater than Sublessor's rights under the Main Lease. Sublessor shall
not be responsible for any failure of Overlandlord to make structural or other
repairs or improvements to the Subleased Premises but Sublessor shall use its
best efforts (at the sole cost and expense of Subtenant) to cause Overlandlord
to make such repairs or improvements, to the extent provided for in the Main
Lease. If Sublessor is unable, due to reasons beyond Sublessor's reasonable
control, to provide heat, air conditioning, water, elevator or other service,
then the failure to furnish, or interruption of, any such services or facilities
shall not give rise to any: (a) abatement, diminution or reduction of
Subtenant's obligations under this Sublease, (b) constructive eviction, whether
in whole or in part, or (c) liability of any kind on the part of Sublessor,
unless caused directly by Sublessor's own gross negligence.
If Overlandlord shall default in the performance of any of its
obligations under the Main Lease with respect to the Subleased Premises,
Sublessor shall, upon the written request of Subtenant, make a
-2-
<PAGE>
demand upon the Overlandlord to perform its obligations under the Main Lease
with respect to the Subleased Premises. If, following the making of such demand
and the expiration of any applicable grace period granted to the Overlandlord
under the Main Lease, Overlandlord has failed to perform its obligations under
the Main Lease, then Sublessor shall, upon the request and at the sole cost and
expense of Subtenant (including, but not limited to, payment of all of
Sublessor's attorney's fees and costs) timely institute and diligently prosecute
any action or proceeding which Subtenant, in its reasonable judgment, deems
meritorious, in order to have Overlandlord make such repairs, furnish such
electricity, provide such services or comply with any other obligation of
Overlandlord under the Main Lease. Sublessor or its attorney shall keep
Subtenant apprised of the status of such action or proceeding and shall not
settle the same without the prior written consent of Subtenant, such consent not
to be unreasonably withheld. Notwithstanding the foregoing, Sublessor shall have
no obligation to institute or diligently prosecute any action or proceeding
which Subtenant could bring directly against Overlandlord without Sublessor
being a party to such action or proceeding. Subtenant shall protect, defend,
indemnify and hold harmless Sublessor from and against any and all claims
arising from or in connection with such request, action or proceeding. As a
condition precedent to Sublessor's obligations to commence, continue or
prosecute any such action, Sublessor may require Subtenant to post such cash or
other collateral as Sublessor reasonably deems appropriate to secure all of
Subtenant's obligations under this provision. All amounts payable under this
provision shall be deemed additional rent hereunder. This provision shall
survive the expiration or other termination of this Sublease.
5. NO BREACH OF MAIN LEASE. Neither Subtenant nor Sublessor shall do
or permit to be done any act or thing which may constitute a breach or violation
of any term, covenant or condition of the Main Lease by the tenant thereunder,
whether or not such act or thing is permitted under the provisions of this
Sublease.
6. NO PRIVITY OF ESTATE. Nothing contained in this Sublease shall be
construed to create privity of estate or of contract between Subtenant and
Overlandlord.
7. INDEMNITY. Subtenant shall indemnify, defend (by attorneys selected
by Sublessor and reasonably acceptable to Subtenant) and hold harmless Sublessor
from and against all losses, costs, damages, expenses and liabilities,
including, without limitation reasonable attorneys' fees, which Sublessor may
incur or pay out by reason of: (a) any accidents, damages or injuries to persons
or property occurring in, on or about the Subleased Premises, (b) any breach or
default hereunder on Subtenant's part, (c) any work done in or to the Subleased
Premises, or (d) any act, omission or negligence on the part of Subtenant and/or
its officers, employees, agents, customers and/or invitees, or any person
claiming through or under Subtenant. Sublessor shall promptly notify Subtenant
of any claim for indemnification.
-3-
<PAGE>
Sublessor shall indemnify, defend (by attorneys selected by Subtenant
and reasonably acceptable to Sublessor) and hold harmless Subtenant from and
against all losses, costs, damages, expenses and liabilities, including, without
limitation reasonable attorneys' fees, which Subtenant may incur or pay out by
reason of any breach or default hereunder on Sublessor's part. Subtenant shall
promptly notify Sublessor of any claim for indemnification.
8. RELEASES. Subtenant hereby releases Overlandlord or anyone claiming
through or under Overlandlord by way of subrogation or otherwise to the extent
that Sublessor released Overlandlord and/or Overlandlord was relieved of
liability or responsibility pursuant to the provisions of the Main Lease, and
Sublessor and Subtenant will be named as additional insureds under their
respective liability insurance policies.
9. RENT. Subtenant shall pay to Sublessor rent (the "Fixed Rent")
through the end of the Sublease Term at the following rates:
(i) from the Commencement Date through December 31, 2001, at the
annual rate of $3,307,612;
(ii) from January 1, 2002 through December 31, 2002, at the
annual rate of $3,398,571;
(iii) from January 1, 2003 through December 31, 2003, at the
annual rate of $3,569,214;
(iv) from January 1, 2004 through December 31, 2004, at the
annual rate of $3,667,691;
(v) from January 1, 2005 through December 31, 2005, at the
annual rate of $3,845,851; and
(vi) from January 1, 2006 through the Termination Date, at the
annual rate of 3,951,093.
The Fixed Rent shall be payable in equal monthly installments in advance on the
first day of each month during the Sublease Term.
Provided Subtenant is not in default under any of the terms of this
Sublease, Subtenant shall be entitled to a credit against the Fixed Rent in the
amount of $275,634 for each of the first three months of the Sublease Term and
$137,817 for the fourth month of the Sublease Term.
-4-
<PAGE>
Fixed Rent and all other amounts payable by Subtenant to Sublessor
herein shall be paid promptly when due, without notice or demand therefore, and
without deduction, abatement, counterclaim or setoff of any amount or for any
reason whatsoever; Fixed Rent and Additional Rent (as hereinafter defined) shall
be paid to Sublessor by good unendorsed check of Subtenant at the address of
Sublessor set forth in Paragraph 18 hereof or to such other person and/or at
such other address as Sublessor may from time to time designate by notice to
Subtenant. No payment by Subtenant or receipt by Sublessor of any lesser amount
than the amount stipulated to be paid hereunder shall be deemed other than on
account of the earliest stipulated Fixed Rent or Additional Rent due under this
Sublease; nor shall any endorsement or statement on any check or letter be
deemed an accord and satisfaction, and Sublessor may accept any check for
payment without prejudice to Sublessor's right to recover the
balance due or to pursue any other remedy available to Sublessor and any
provision in the Main Lease referring to fixed rent or additional rent
incorporated herein by reference shall be deemed to refer to the Fixed Rent and
Additional Rent due under this Sublease.
10. LATE CHARGES. If payment of any Fixed Rent or Additional Rent
shall not have been paid by the fifth (5th) day after the date on which such
amount was due and payable, a late charge equal to the lesser of five (%)
percent of the amount due or Fifteen Thousand ($15,000) Dollars, be payable as
liquidated damages for Subtenant's failure to make prompt payment. In addition,
in the event that any Fixed Rent or Additional Rent shall not have been paid by
the fifteenth (15th) day after the date on which such amount was due and payable
interest shall be due and payable as an additional late charge at the rate of
two (2%) percent per calendar month or any part thereof on the amount due from
the date on which such amount was originally due and payable (or the maximum
rate of interest which may lawfully be collected from the Subtenant, whichever
is less), as liquidated damages for Subtenant's continued failure to make such
payment. The late charge for any month shall be payable on the first day of the
following month, and in default of payment of any late charges, Sublessor shall
have (in addition to all other remedies) the same rights as provided in this
Sublease (including the provisions incorporated by reference) for non-payment of
Fixed Rent. Nothing in this Paragraph 10 and no acceptance of late charges by
Sublessor shall be deemed to extend or change the time for payment of Fixed Rent
or Additional Rent.
11. ADDITIONAL RENT. All amounts payable by Subtenant to Sublessor in
accordance with this Sublease, other than Fixed Rent, shall be deemed additional
rent ("Additional Rent"), payable on the first day of each month during the term
of this Sublease, and upon any default by Subtenant in paying any such
Additional Rent, Sublessor shall be entitled to the remedies available to it
hereunder or at law upon the non-payment of Fixed Rent.
(a) Taxes Increase. Subtenant shall pay to Sublessor, as Additional
Rent, all amounts payable by Sublessor under Article 39 of the Main Lease, with
the following changes:
-5-
<PAGE>
(i) for the purpose of this Sublease, "Base Tax" shall mean the
Taxes (as defined in the Main Lease) for the calendar year
2000, and "Tenant's Proportionate Share" shall be 18.082%;
(ii) Insert28E shall not be applicable and Article 39E shall
apply only to Overlandlord;
(iii) all payments from Subtenant to Sublessor shall be due five
(5) days prior to the time when such payments are due from
Sublessor to Overlandlord; and
(iv) Overlandlord's statement to Sublessor as to the Taxes shall
be dispositive as between Sublessor and Subtenant.
(b) Electricity Charge. Subtenant shall pay to Sublessor, as
Additional Rent, an electricity charge pursuant to Article 65 of the Main Lease,
with the following changes:
(i) Subtenant shall only pay such electricity charge for the
Subleased Premises;
(ii) the minimum monthly electricity charge, as set forth in
Insert 43 and the last paragraph of Article 65 shall be
$18,480;
(iii) Sublessor shall, promptly after the Commencement Date,
initiate an electrical survey of the Subleased Premises, as
provided for in Insert 43; and
(iv) the time period in Insert 43A is changed to be twenty (20)
days written notice to Subtenant.
(c) Operating Expense Escalation. An annual operating expense
escalation of 2.75% is included in the foregoing Fixed Rent increases.
(d) Local Laws. Subtenant shall pay to Sublessor, as Additional Rent,
the amounts payable by Sublessor under Article 37 of the Main Lease, with the
following change: the percentage figure in the penultimate line thereof is
changed to 18.082%.
12. UTILITIES. (a) Sublessor 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 Subleased Premises, unless caused directly by
Sublessor's own gross negligence.
(b) If, at any time during the term of this Sublease, Subtenant wishes
to install in the Subleased Premises equipment which would not be considered
ordinary office equipment, including, but not limited to, items such as assembly
machinery, supplemental air conditioning systems, or other heat or
cooling-intensive electrically operated equipment, Subtenant shall submit to
-6-
<PAGE>
Sublessor a list indicating the specific type of additional equipment to be
installed. Such list shall include the number, type and model of each item of
equipment to be installed, as well as the manufacturer's electric rating
associated with same. If, in Sublessor's sole judgment the operation of such
equipment will impair the proper and efficient operation of the electrical,
plumbing, heating, ventilation or air conditioning systems for the Subleased
Premises or the Building, as a condition to the installation of such equipment,
Subtenant shall reimburse Sublessor for Sublessor's cost incurred, as a result
of such equipment installation and operation, in connection with the proper and
efficient function of such systems.
13. USE. Subtenant shall use and occupy the Subleased Premises only
for customary office uses. Furthermore, Subtenant shall comply with all use
restrictions contained in the Main Lease. Subtenant shall also comply with the
certificate of occupancy relating to the Subleased Premises and with all laws,
statutes, ordinances, orders, rules, regulations and requirement of all federal,
state and municipal governments and the appropriate agencies, officers,
departments, boards and commissions thereof, and the board of fire underwriters
and/or the fire insurance rating organization or similar organization performing
the same or similar functions, whether now or hereafter in force, applicable to
the Subleased Premises and/or Subtenant's use of the Subleased Premises.
Subtenant shall operate its business in the Subleased Premises only in a manner
consistent with the first class character of the Building.
14. EQUIPMENT. Subject to the provisions of the Main Lease and this
Sublease, Subtenant shall have the right, at its own cost and expense, to
install and maintain such customary office equipment as Subtenant may reasonably
require for Subtenant's use of the Subleased Premises.
Subtenant shall not place any load upon the floor of the Subleased
Premises in excess of the load per square foot it was designed to carry and
which is permitted by the Main Lease or applicable law.
15. CONDITION OF SUBLEASED PREMISES. Subtenant is leasing the
Subleased Premises in its"AS-IS" condition on the date hereof, reasonable wear
and tear excepted, other than Sublessor delivering the Subleased Premises in
vacant, broom clean condition. In making and executing this Sublease, Subtenant
has relied solely on such investigations, examinations and inspections as
Subtenant has chosen to make or has made. Subtenant acknowledges that Sublessor
has afforded Subtenant the opportunity for full and complete investigations,
examinations, and inspections. Notwithstanding the foregoing, Sublessor shall
have the right, but not the obligation, prior to the Commencement Date to remove
from the Subleased Premises any or all of its personal property and equipment.
16. CONSENTS AND APPROVALS. In any instance when Sublessor's consent
or approval is required under this Sublease, Sublessor's refusal to consent to
or approve any matter or thing shall be deemed reasonable if, inter alia, such
consent or approval has not been obtained from Overlandlord; provided, however,
Sublessor covenants to use reasonable efforts (at Subtenant's sole cost and
expense) to obtain the consent or approval of Overlandlord. In the event that
Subtenant shall seek the approval by or consent of Sublessor and Sublessor shall
-7-
<PAGE>
fail or refuse to give such consent or approval, Subtenant shall not be entitled
to any damages for any withholding or delay of such approval or consent by
Sublessor, it being intended that Subtenant's sole remedy shall be an action for
injunction or specific performance and said remedy of an action for injunction
or specific performance shall be available only in those cases, if any, where
Sublessor shall have expressly agreed in writing not to unreasonably withhold or
delay its consent.
17. SUBLESSOR'S LIABILITY. Sublessor (and its employees, officers,
directors, subsidiaries, affiliates and agents) shall have no personal liability
with respect to this Sublease, and if Sublessor is in breach or default under
this Sublease, Subtenant shall look solely to the equity of Sublessor in the
Subleased Premises for the satisfaction of Subtenant's remedies and in no event
shall Subtenant attempt to secure or execute any personal judgment against
Sublessor (or its employees, officers, directors, subsidiaries, affiliates or
agents) by reason of such default by Sublessor.
18. NOTICES. All notices, consents, approvals, demands and requests
("Notices") hereunder shall be in writing and shall be (i) personally delivered,
(ii) sent by reputable overnight courier delivery service, or (iii) sent by
United States registered or certified mail and deposited in a United States post
office, return receipt requested and postage prepaid. Notices which are served
in the manner provided herein shall be deemed to have been given on the day
personally delivered, the next business day after sending by overnight courier
or on the third (3rd) business day after mailing. After the Commencement Date,
all Notices given to Subtenant shall be addressed to Subtenant at the Subleased
Premises to the attention of its President, with a copy to its Executive Vice
President-Business and Legal Affairs. All Notices given to Sublessor shall be
addressed to it at the address set forth at the beginning of this Sublease to
the attention of Michael L. Gembecki, Vice President, with a copy to Phillips,
Lytle, Hitchcock, Blaine & Huber LLP, 437 Madison Avenue, New York, NY 10022, to
the attention of Milan K. Tyler, Esq. Either party may from time to time change
the names and/or addresses to which Notices shall be addressed by a notice given
in accordance with the provisions hereof. Attorneys for the parties hereto shall
be authorized to give Notices on behalf of their respective clients.
19. EVENTS OF DEFAULT. (a) The occurrence of any of the following
shall constitute a material default and breach of this Sublease by Subtenant:
(i) any failure by Subtenant to pay the Fixed Rent required to
be paid hereunder within five (5) days of the date when due;
(ii) any failure by Subtenant to pay Additional Rent where such
failure continues for five (5) days after written notice
thereof by Sublessor to Subtenant;
-8-
<PAGE>
(iii) any failure by Subtenant to observe and perform any other
provision of this Sublease to be observed or performed by
Subtenant, where such failure continues for ten (10) days
after written notice thereof by Sublessor to Subtenant;
(iv) if Subtenant shall assign, mortgage, or encumber this
Sublease, or if this Sublease or the leasehold estate of
Subtenant hereunder shall be transferred or pass to or
devolve upon any person, firm or corporation other than
Subtenant named herein, except as expressly permitted
hereunder; or
(v) the making by Subtenant of any general assignment for the
benefit of creditors, the filing by or against Subtenant of
a petition to have Subtenant adjudged a bankrupt or of a
petition for reorganization or arrangement under any law
relating to bankruptcy, the appointment of a trustee or
receiver to take possession of all or substantially all of
Subtenant's assets located at the Subleased Premises or of
Subtenant's interest in this Sublease, or the attachment
execution or other judicial seizure of all or substantially
all of Subtenant's assets located at the Subleased Premises
or of Subtenant's interest in this Sublease.
(b) In the event of any such default by Subtenant, then in addition to
other remedies available to Sublessor at law or in equity, then immediately upon
the giving of notice to such effect by Sublessor (or immediately without the
giving of notice with regard to subparagraph (v) above), at Sublessor's sole
option, the term of this Sublease shall end as if the date of such notice were
the Sublease Term termination date set forth herein. In such event, then
Sublessor may recover from Subtenant:
(i) the amount of any Fixed Rent and Additional Rent due under
this Sublease which had been earned at the time of such
termination; plus
(ii) the worth of all unpaid rent for the balance of the Sublease
Term at the time of award; plus
(iii) legal expenses, attorney's fees, court costs, costs of
reletting and brokerage fees.
(c) In the event of any such default by Subtenant, then in addition to
other remedies available to Sublessor at law or in equity, Sublessor shall also
have the right, with or without terminating this Sublease, to reenter the
Subleased Premises and remove all persons and property from the Subleased
Premises; such property may be removed and stored in a public warehouse or
elsewhere at the cost of and for the account of Subtenant.
-9-
<PAGE>
(d) In the event of any such default by Subtenant, and the termination
of this Sublease by Sublessor as aforesaid, then in addition to other remedies
available to Sublessor at law or in equity, Sublessor shall also have the right,
but not the obligation, to relet the Subleased Premises upon terms and
conditions acceptable to Sublessor in its sole and absolute discretion. In the
event that Sublessor shall elect to relet the Subleased Premises, then rentals
received by Sublessor from such reletting shall be applied: first, to the
payment of any indebtedness other than rent and other charges due hereunder from
Subtenant to Sublessor; second, to the payment of any cost of such reletting;
third, to the payment of the cost of any alterations and repairs to the
Subleased Premises; fourth, to the payment of rent due and unpaid hereunder; and
the residue, if any shall be held by Sublessor and applied in payment of future
rent as the same may be come due and payable hereunder. Should the amount of
rental received from such reletting during any month which is applied to the
payment of rent hereunder be less than that agreed to be paid during that month
by Subtenant hereunder, then Subtenant shall pay such deficiency to Sublessor
immediately upon demand therefor by Sublessor. Such deficiency shall be
calculated and paid monthly. Subtenant shall also pay to Sublessor, as soon as
ascertained, any costs and expenses incurred by Sublessor, in such reletting or
in making any alterations and repairs made to the Subleased Premises not covered
by the rentals received from such reletting.
(e) No reentry or taking possession of the Subleased Premises by
Sublessor shall be construed as an election to terminate this Sublease unless a
written notice of such intention is given to Subtenant or unless the termination
thereof is decreed by a court of competent jurisdiction.
20. TERMINATION OF MAIN LEASE. If for any reason the term of the Main
Lease shall terminate prior to the expiration date of this Sublease, this
Sublease shall thereupon be terminated and Sublessor shall not be liable to
Subtenant by reason thereof unless both: (a) Subtenant is not then in default
hereunder, and (b) said termination shall have been effected because of the
default of Sublessor under the Main Lease.
21. ASSIGNMENT AND SUBLETTING. (a) Subtenant shall not, by operation
of law or otherwise, assign, sell, mortgage, pledge or in any manner transfer
this Sublease or any interest therein, or sublet the Subleased Premises or any
part or parts thereof, or grant any concession or license or otherwise permit
occupancy of all or any part of the Subleased Premises by any person, without
the prior written consent of Sublessor in each instance, which consent may be
withheld in Sublessor's sole discretion. However, Sublessor shall not
unreasonably withhold its consent to an assignment of this Sublease or a
sublease of all or any portion of the Subleased Premises provided that:
(i) Subtenant shall have furnished Sublessor with the name and
address of the proposed assignee/subtenant and its
principals and proof reasonably satisfactory to Sublessor
evidencing that the proposed assignee/subtenant: (A) is of a
sound financial condition; (B) is of good character; and (C)
if a partnership, corporation or other entity, is validly
formed, is qualified to transact business in the State of
New York and has duly authorized the signatories to sign all
documents on its behalf so as to bind the assignee;
-10-
<PAGE>
(ii) The proposed assignee/subtenant shall use the Sublease
Premises only for the purposes specified in Paragraph 13;
(iii) Subtenant shall not then be in default in the performance of
any obligations on its part to be performed hereunder;
(iv) Subtenant shall have obtained Overlandlord's consent
thereto, if required; and
(v) Simultaneously with the granting by Sublessor of its
consent, (A) the assignor shall deliver to Sublessor an
executed duplicate original of the assignment or sublease;
(B) the assignee shall execute and deliver to the Sublessor
an assumption or attornment agreement whereunder the
assignee agrees to assume, perform and be bound by all
covenants, agreements and conditions on the part of the
Subtenant to be observed and performed under this Sublease;
(C) at the request of Sublessor, Subtenant and the
assignee/subtenant shall enter into a consent or three party
agreement with respect to such assignment or sublease in
form and substance reasonably satisfactory to Sublessor; and
(D) Subtenant shall pay to Sublessor fifty (50%) percent of
(i) either the consideration received or to be received by
Subtenant for such assignment, or (ii) the excess of the
amount of rent payable by such sub-subtenant to Subtenant
over the amount of rent payable by Subtenant hereunder
allocable to such sub-sublet space, as applicable.
Any request by Subtenant for Sublessor's consent to either an
assignment of this Sublease, or a sublease of all or any portion of the
Subleased Premises for a term expiring within one (1) year of the Termination
Date, shall be deemed to be an offer from Subtenant to surrender possession and
occupancy of the affected portion of the Subleased Premises. If Sublessor, in
its sole discretion, accepts such offer, then the affected portion of the
Subleased Premises shall be removed from the scope of this Sublease and
Subtenant's rights and obligations hereunder shall be decreased accordingly. In
such event, Subtenant shall surrender to Sublessor possession and occupancy of
the affected portion of the Subleased Premises on the date the requested
assignment or subletting would have commenced, and thereafter Sublessor shall be
free to deal with such portion of the Subleased Premises as Sublessor sees fit,
subject only to the applicable provisions of the Main Lease. In such event,
Sublessor and Subtenant agree to execute an agreement modifying this Sublease to
confirm the foregoing.
-11-
<PAGE>
(b) If conditions (ii), (iii), (iv) and (v)(A), (B) and (C) of
subsection (a) above have been satisfied and the assignee has a net worth
greater than or equal to the net worth of the Subtenant on the date hereof or on
the date of such assignment, whichever is greater, then Sublessor's prior
written consent shall not be required for an assignment of this Sublease to a
parent or subsidiary corporation or in connection with a corporate merger
transaction.
(c) Other than as to transactions on a public stock exchange, the
assignment, sale, mortgaging, pledging or other manner of transfer, by operation
of law or otherwise, during the term of this Sublease of more than forty-nine
percent (49%) in the aggregate of the legal or beneficial ownership of Subtenant
or the issuance of additional shares or other ownership interests to the extent
of more than 49% in the aggregate of the legal or beneficial ownership of
Subtenant hereunder, or any combination thereof, shall constitute an assignment
of this Sublease and, unless in each instance the prior written consent of
Sublessor has been obtained, shall constitute a default under this Sublease and
shall entitle Sublessor to exercise all rights and remedies provided for herein
in the case of default.
(d) If this Sublease is assigned, whether nor not in violation of the
provisions of this Sublease, Sublessor may collect rent from such assignee. If
the Subleased Premises or any part thereof are licensed, sublet or used or
occupied by any person other than Subtenant, whether or not in violation of this
Sublease, Sublessor may collect rent from the subtenant or occupant. In either
event, Sublessor may apply the net amount collected to the Fixed Rent and
Additional Rent herein reserved, but no such assignment, subletting, occupancy
or collection shall be deemed a waiver of any of the provisions of this
Sublease, or the acceptance of the assignee, subtenant, licensee or occupant as
tenant, or as a release of Subtenant from the performance by Subtenant of
Subtenant's obligations under this Sublease. The consent by Sublessor to
assignment, mortgaging, subletting, licensing or use or occupancy by others
shall not in any way be considered to relieve Subtenant from obtaining the prior
written consent of Sublessor to any other or further assignment, mortgaging or
subletting or use or occupancy by others not expressly permitted by this
Paragraph.
(e) Subtenant covenants that, notwithstanding any assignment,
subletting or transfer, whether or not in violation of the provisions of this
Sublease, and notwithstanding the acceptance of Fixed Rent and/or Additional
Rent by Sublessor from an assignee, subtenant, transferee, licensee, or any
other party, Subtenant shall remain fully and personally liable for the payment
of the fixed rent and additional rents and for each of the other obligations of
this Sublease on the part of Subtenant to be performed or observed.
(f) The joint and severally liability of Subtenant and any immediate
or remote successor in interest of Subtenant and the due performance of the
obligations of this Sublease on Subtenant's part to be performed or observed
shall not be discharged, released or impaired in any respect by any agreement or
stipulation made by Sublessor extending the time of, or modifying any of the
obligations of this Sublease, or by any waiver or failure of Sublessor to
enforce any of the obligations of this Sublease.
-12-
<PAGE>
22. INSURANCE. Subtenant shall maintain throughout the term of this
Sublease comprehensive general public liability insurance in respect of the
Subleased Premises and the conduct and operation of business therein, with
Sublessor, Overlandlord and any other party required under the Main Lease as
additional insureds, with limits of not less than $3,000,000 combined single
limit for bodily injury or death or property damage in any one occurrence,
including water damage and, if applicable, sprinkler or leakage liability.
Subtenant shall also maintain at all times during the Sublease Term an "all
risk" property insurance policy covering Subtenant's property improvements and
betterments for the full replacement value of the same, less a reasonable
deductible of up to $50,000. Subtenant shall deliver to Sublessor fully paid-for
policies or binders or insurance certificates evidencing such coverage prior to
the Commencement Date. Subtenant shall procure and pay for renewals or
replacements of such insurance from time to time before the expiration thereof,
and Subtenant shall deliver to Sublessor such renewal or replacement policy or
binder or certificates at least thirty (30) days before the expiration of any
existing policy. All such policies shall be issued by companies rated "A" or
better by Best Insurance Reports and licensed to do business in the State of New
York, and all such policies shall contain a provision whereby the same cannot be
cancelled or modified unless Sublessor and Overlandlord are given at least,
thirty (30) days' prior written notice by certified or registered mail of such
cancellation or modification.
23. ESTOPPEL CERTIFICATES. Subtenant shall, within ten (10) days after
each and every request by Sublessor (up to twice per year unless requested by
Overlandlord), execute, acknowledge and deliver to Sublessor a statement in
writing: (a) certifying that this Sublease is unmodified and in full force and
effect (or if there have been modifications, that the same is in full force and
effect as modified, and stating the modifications), (b) specifying the dates to
which the Fixed Rent and Additional Rent have been paid, (c) stating whether or
not Sublessor is in default in performance or observance of its obligations
under this Sublease, and if so, specifying each such default, (d) stating
whether or not any event has occurred which with the giving of notice or passage
of time, or both, would constitute a default by Sublessor under this Sublease,
and if so, specifying each such event, and (e) as to any other matters
reasonably requested by Sublessor. Any such statement delivered pursuant to this
Paragraph may be relied upon by any prospective assignee or transferee of the
leasehold estate under the Main Lease.
24. ALTERATIONS. Subtenant shall not make any alterations, additions
or improvements in or to the Subleased Premises which are structural in nature
or which would affect the plumbing, electrical lines or systems or HVAC systems
of the Building in any substantial respect without the prior written consent of
Overlandlord and Sublessor. Subtenant may make cosmetic, non-structural
alterations, additions or improvements in or to the Subleased Premises which do
not affect the plumbing, or electrical lines or systems or HVAC systems of the
Building without Sublessor's prior written consent, but subject to reasonably
prior notice to Sublessor and Overlandlord, as to any such alterations,
additions or improvements costing Seven Thousand Five Hundred ($7,500) Dollars
or more. All other alterations, additions or improvements in or to the Subleased
Premises shall require Sublessor's prior written consent, which shall not be
unreasonably withheld, subject to the approval of Overlandlord if required under
the Main Lease.
-13-
<PAGE>
Subtenant covenants that it will cause all such alterations, additions
and improvements to be performed at Subtenant's sole cost and expense and in a
manner which: (a) is consistent with the approved plans and specifications and
any conditions imposed by Sublessor or Overlandlord in connection therewith (if
applicable); (b) is in conformity with high quality commercial standards; (c)
includes reasonably acceptable insurance coverage for Sublessor's and
Overlandlord's benefit; (d) does not adversely affect the structural integrity
or building systems of the Building; (e) does not disrupt the business or
operations of any tenants in the Building; and (f) does not invalidate or
otherwise affect the construction and systems warranties then in effect with
respect to the Building. Subtenant or Subtenant's contractor shall: (i) secure
all governmental permits and approvals, as well as comply with all other
applicable governmental requirements and restrictions; (ii) reimburse Sublessor
for all reasonable expenses incurred in connection therewith; and (iii) comply
with any reasonable requirements of Sublessor's construction consultant imposed
in connection therewith, if any. Subtenant shall indemnify, defend and hold
harmless Sublessor from and against all losses, liabilities, damages, liens,
costs, penalties and expenses (including attorney's fees, but without waiver of
the duty to hold harmless) arising from or out of the performance of such
alterations, additions and improvements, including, but not limited to, all
which arise from or out of Subtenant's breach of its obligations under the terms
of this Paragraph. Subject to Article 3 and the other provisions of the Main
Lease, all alterations, additions and improvements, except Subtenant's trade
fixtures, moveable office furniture and equipment, shall upon expiration or
termination of this Sublease immediately become the property of Sublessor
without any obligation on its part to pay therefor.
25. RIGHT TO CURE SUBTENANT'S DEFAULTS. If Subtenant shall at any time
fail to make any payment or perform any other obligation of Subtenant hereunder,
then Sublessor shall have the right, but not the obligation, after three (3)
days' notice to Subtenant, or without notice to Subtenant in the case of any
emergency, and without waiving or releasing Subtenant from any obligations of
Subtenant hereunder, to make such payment or perform such other obligation of
Subtenant in such manner and to such extent as Sublessor shall deem necessary,
and in exercising any such right, to pay any incidental costs and expenses,
employ consultants, and incur and pay attorneys' fees. Subtenant shall pay to
Sublessor upon demand all sums so paid by Sublessor and all incidental costs and
expenses of Sublessor in connection therewith, together with interest thereon at
the rate of two percent (2%) per calendar month or any part thereof (or the then
maximum rate of interest which may lawfully be collected from Subtenant,
whichever shall be less), from the date of the making of such expenditures.
26. BROKERAGE. Subtenant represents to Sublessor that no broker or
other person had any part, or was instrumental in any way, in bringing about
this Sublease, other than Cushman & Wakefield, Inc. and Newmark and Company Real
Estate, Inc. and Subtenant shall pay, and shall indemnify, defend (by attorneys
selected by Sublessor), and hold harmless, Sublessor from and against, any
claims made by any other broker or other person for a brokerage commission,
finder's fee, or similar compensation, by reason of or in connection with this
Sublease, and any loss, liability, damage, cost and expense (including, without
limitation, attorney's fees) in connection with any such claims if such other
broker or other person claims to have had dealings with Subtenant. Sublessor
agrees to pay, or cause to be paid, any commissions due to the aforementioned
brokers.
-14-
<PAGE>
27. WAIVER OF JURY TRIAL AND RIGHT TO COUNTERCLAIM. SUBLESSOR AND
SUBTENANT HEREBY WAIVE ALL RIGHT TO TRIAL BY JURY IN ANY SUMMARY OR OTHER
ACTION, PROCEEDING OR COUNTERCLAIM ARISING OUT OF OR 1N ANY WAY CONNECTED WITH
THIS SUBLEASE, THE RELATIONSHIP OF SUBLESSOR AND SUBTENANT, THE SUBLEASED
PREMISES AND THE USE AND OCCUPANCY THEREOF, AND ANY CLAIM OF INJURY OR DAMAGES.
SUBTENANT ALSO HEREBY WAIVES ALL RIGHT TO ASSERT OR INTERPOSE A COUNTERCLAIM IN
ANY SUMMARY PROCEEDING OR OTHER ACTION OR PROCEEDING TO RECOVER OR OBTAIN
POSSESSION OF THE SUBLEASED PREMISES.
28. SUBTENANT'S SIGNS. Subtenant shall not install in the Subleased
Premises or on or in any portion of the Building any exterior or interior signs,
awnings, projections, advertisements, notices, nameplates or lettering
(including any changes thereto) unless Subtenant obtains the prior written
consent of Sublessor (not to be unreasonably withheld) and Overlandlord (if
applicable) and complies with all applicable law. Notwithstanding the foregoing,
Subtenant shall be entitled to ten (10) directory listings, to be installed (or
changed from time to time) at Subtenant's expense.
29. NO WAIVER. The failure of Sublessor to insist in any one or more
case upon the strict performance or observance of any obligation of Subtenant
hereunder or to exercise any right or option contained herein shall not be
construed as a waiver or relinquishment for the future of any such obligation of
Subtenant or any right or option of Sublessor. Sublessor's receipt and
acceptance of Fixed Rent or Additional Charges, or Sublessor's acceptance of
performance of any other obligation by Subtenant, with knowledge of Subtenant's
breach of any provision of this Sublease, shall not be deemed a waiver of such
breach. No waiver by Sublessor of any term, covenant or condition of this
Sublease shall be deemed to have been made unless expressed in writing and
signed by Sublessor.
30. COMPLETE AGREEMENT. There are no representations, agreements,
arrangements or understandings, oral or written, between the parties relating to
the subject matter of this Sublease which are not fully expressed in this
Sublease. This Sublease cannot be changed or terminated orally or in any manner
other than by a written agreement executed by both parties hereto.
31. SUCCESSORS AND ASSIGNS. The provisions of this Sublease, except as
herein otherwise specifically provided, shall extend to, bind and inure to the
benefit of the parties hereto and their respective personal representatives,
heirs, successors and permitted assigns. In the event of any assignment or
transfer of the leasehold estate under the Main Lease, the transferor is
entirely relieved and freed of all obligations under this Sublease.
-15-
<PAGE>
32. INTERPRETATION. Irrespective of the place of execution or
performance, this Sublease shall be governed by and construed in accordance with
the laws of the State of New York. If any provision of this Sublease or the
application thereof to any person or circumstance shall, for any reason and to
any extent, be invalid or unenforceable, the remainder of this Sublease and the
application of that provision to other persons or circumstances shall not be
affected but rather shall be enforced to the extent permitted by law. The
captions, headings and titles in this Sublease are solely for convenience of
reference and shall not affect its interpretation. This Sublease shall be
construed without regard to any presumption or other rule requiring construction
against the party causing this Sublease to be drafted. If any words or phrases
in this Sublease shall have been stricken out or otherwise eliminated, whether
or not any other words or phrases have been added, this Sublease shall be
construed as if the words or phrases so stricken out or otherwise eliminated
were never included in this Sublease and no implication or inference shall be
drawn from the fact that said words or phrases were so stricken out or otherwise
eliminated. Each covenant, agreement, obligation or other provision of this
Sublease shall be deemed and construed as a separate and independent covenant of
the party bound by, undertaking or making same, not dependent on any other
provision of this Sublease unless otherwise expressly provided. All terms and
words used in this Sublease, regardless of the number of gender in which they
are used, shall be deemed to include any other number and any other gender as
the context may require. The word " ep rson" as used in this Sublease shall mean
a natural person or persons, a partnership, a corporation or any other form of
business or legal association or entity.
33. SECURITY DEPOSIT. (a) Simultaneously with the execution of this
Sublease, Subtenant shall deposit the sum of Five Million Seventy Five Thousand
($5,075,000) Dollars with Sublessor ("Cash Deposit") as security for the full
and faithful performance and observance by Subtenant of Subtenant's covenants or
obligations under this Sublease (the "Security Deposit"). Sublessor may invest
the Cash Deposit in a one-year certificate of deposit (the "CD") with HSBC Bank
USA and provided Subtenant is not in default under this Sublease and upon
Subtenant's request, Sublessor shall pay to Subtenant, not more than once a
year, the interest earned on the CD. So long as Subtenant is not in default
under any of its obligations under this Sublease, the required amount of Cash
Deposit shall decrease by $211,458 per month, commencing on August 1, 2004 (but
the required amount of the Cash Deposit shall never be less than $500,000).
(b) At any time in lieu of the Cash Deposit, Subtenant may deliver
(and receive any Cash Deposit held by Sublessor in return) a clean, irrevocable,
evergreen, transferrable and unconditional letter of credit (the "Letter of
Credit"), in form and content reasonably satisfactory to Sublessor, issued by
and drawable upon any major money center bank which is a New York Clearing House
Member and maintains throughout the period of the Letter of Credit a Standard &
Poor's rating of at least A (the "Issuing Bank"), which Letter of Credit shall
have a term of not less than one year, be for the account of Sublessor, be in
the amount of the applicable Cash Deposit, provide for multiple partial draws,
and be fully transferable by Sublessor without the payment of any fees or
charges. The Letter of Credit shall provide that it shall be deemed
automatically renewed, without amendment, for consecutive periods of one year
each thereafter during the term of this Sublease, unless the Issuing Bank sends
notice (the "NonRenewal Notice") to Sublessor by certified mail, return receipt
requested, not less than thirty (30) days next preceding the then expiration
date of the Letter of Credit that it elects not to have such Letter of Credit
renewed. If the Issuing Bank sends a Non-Renewal Notice, then at least twenty
(20) days prior to the expiration of the Letter of Credit (and each subsequent
-16-
<PAGE>
Letter of Credit), Subtenant shall deliver to Sublessor either (i) cash in the
amount of the required Cash Deposit or (ii) a renewal or new Letter of Credit in
the same amount as the required Cash Deposit. If Subtenant fails to deliver
either the cash or renewal or new Letter of Credit as specified above prior to
the expiration of such twenty (20) day period, time being of the essence, then
Sublessor shall have the immediate and continuing right to draw upon the
existing Letter of Credit and to receive the monies represented by the existing
Letter of Credit and to hold such proceeds pursuant to the terms of this Article
as a Cash Deposit.
(c) The Letter of Credit shall provide, inter alia, that:
The Issuing Bank shall pay to the Sublessor or its designee up
to the amount of Letter of Credit upon presentation of only (a) the
Letter of Credit and (b) a certificate purportedly executed by an
officer of the Sublessor stating that "Subtenant is in default under
the Sublease, between Sublessor and Subtenant, $[Amount to be
designated] is due under such Sublease and you are hereby instructed to
pay such amount to HSBC Bank USA under the Letter of Credit No. , dated
, 20 , issued by to Sublessor" or stating that "Subtenant has not
delivered a renewal or new Letter of Credit to Sublessor in accordance
with the requirements of Article _ of the Sublease between Sublessor
and Subtenant and you are hereby directed to pay the entire amount of
the Letter of Credit No. , dated , 20 , to HSBC Bank USA."
(d) If Subtenant defaults in the full and prompt payment and
performance of any of Subtenant's covenants or obligations under this Sublease,
including, but not limited to, the payment of rent, Sublessor may use, apply or
retain the whole or any part of the Security Deposit and the interest accrued
thereon, if any, to the extent required for the payment of any rent or any other
sums as to which Subtenant is in default or for any sum which Sublessor may
expend or may be required to expend by reason of Subtenant's default in respect
of any of the terms, covenants and conditions of this Sublease, including, but
not limited to, any damages or deficiency in the reletting of all or any portion
of the Subleased Premises, whether such damages or deficiency accrue before or
after summary proceedings or other re-entry by Sublessor. If Sublessor shall so
use, apply or retain the whole or any part of the Security Deposit and the
interest accrued thereon, Subtenant shall upon demand immediately deposit with
Sublessor a sum equal to the amount so used, applied or retained.
(e) If Subtenant shall fully and faithfully comply with all of
Subtenant's covenants and obligations under this Sublease, the Security Deposit
or any balance thereof, shall be returned or paid over to Subtenant after the
date on which this Sublease shall expire or terminate, and after delivery to
Sublessor of entire possession of the Subleased Premises as provided herein. In
the event of any sale of Sublessor's interest in the Building, Sublessor shall
have the right to assign its interest in the Security Deposit to the transferee
or assignee and if Sublessor has given notice to Subtenant of the assignment of
Sublessor's interest in the Security Deposit, Sublessor shall thereupon be
released by Subtenant from all liability for the return or payment thereof; and
Subtenant shall look solely to the new Sublessor for the return or payment of
the same; and the provisions hereof shall apply to every transfer or assignment
made of the same to a new Sublessor. Subtenant shall not assign or encumber or
attempt to assign or encumber the Security Deposit and neither Sublessor nor its
successors or assigns shall be bound by any such assignment, encumbrance,
attempted assignment or attempted encumbrance.
-17-
<PAGE>
34. VACATING THE SUBLEASED PREMISES. Upon the expiration or sooner
termination of the Sublease Term, Subtenant shall vacate the Subleased Premises,
broom-clean and free of all subtenancies or other occupants and in the condition
required by the Main Lease.
35. HAZARDOUS MATERIALS. Subtenant covenants and agrees not to suffer,
permit, introduce or maintain in, on or about any part of the Subleased Premises
any asbestos, polychlorinated byphenals, petroleum products or other hazardous
or toxic materials wastes or substances.
IN WITNESS WHEREOF, Sublessor and Subtenant have executed this
Sublease as of the day and year first above written.
SUBLESSOR: HSBC BANK USA
By: /s/Michael Gembecki
---------------
Michael Gembecki
Vice President
SUBTENANT: MARVEL ENTERPRISES, INC.
By: /s/ Allen S.Lipson
-----------------
Allen S. Lipson
Executive Vice President
-18-
<PAGE>
FIRST AMENDMENT
TO
SUBLEASE
This First Amendment to Sublease (this "Agreement"), dated as of
December 1, 2000, is between HSBC BANK USA, a New York banking corporation
having an office at 140 Broadway, New York, New York 10005, as landlord
("Landlord"), and MARVEL ENTERPRISES, INC., a Delaware corporation having an
office a 387 Park Avenue South, New York, NY 10016, as tenant ("Tenant").
RECITALS:
WHEREAS, Landlord and Tenant entered into a Sublease dated as of June
9, 2000 ("Sublease"), whereby Tenant subleases from Landlord certain premises
located in the building known as 8-10 East 40' Street, New York, NY, as such
premises are more particularly described in the Sublease (the "Demised
Premises");
WHEREAS, Tenant has requested that Landlord consent to a surrender of
a portion of the Demised Premises and Landlord is willing to accept such
surrender, subject to the terms and conditions of this Agreement;
WHEREAS, Landlord and Tenant desire to amend certain terms and
provisions of the Sublease in connection with such surrender of a portion of the
Demised Premises;
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto agree as
follows:
1. DEFINITIONS. All capitalized terms not defined herein shall have
the meanings ascribed to them in the Sublease.
2. SURRENDER. Tenant hereby surrenders to Landlord and Landlord hereby
accepts the surrender by Tenant of that portion of the Demised Premises located
on the 12' floor of the Building ("Surrendered Premises"). Pursuant to the
Sublease, Landlord had not previously delivered possession of the Surrendered
Premises to Tenant and therefore Landlord will accept the surrender thereof in
its "as-is" condition.
3. RELEASE. Landlord and Tenant hereby release each other, effective
as of the date of this Agreement, from any and all obligations under the
Sublease with respect to the Surrendered Premises, except for any obligations
which expressly survive the expiration of the term of or sooner termination of
the Sublease.
4. AMENDMENTS. Effective as of the date of this Agreement, the
Sublease is hereby amended as follows:
(a) Paragraph 1 of the Sublease is hereby deleted and the following
text is substituted in its place:
-1-
<PAGE>
"1. DEMISE AND TERM. Sublessor leases to Subtenant, and Subtenant
hires from Sublessor, certain premises identified as Room 801, 9'
Floor, 10' Floor and 11th Floor as identified on Schedule A attached
hereto and made a part hereof (collectively, the "Subleased Premises")
located in the building ("Building") known as 8-10 East 401 Street,
New York, NY and being a portion of the premises which were leased to
Sublessor under the Main Lease (as hereinafter defined). The term of
this Sublease (the "Sublease Term") shall be the period: (a)
commencing on the date Sublessor tenders possession of the Subleased
Premises to Subtenant, which is anticipated to be on or about April 1,
2001 (the "Commencement Date"), and (b) ending at midnight on July 31,
2006 unless sooner terminated as herein provided (the "Termination
Date"). If the Commencement Date does not occur by April 1, 2001 for
any reason not due to Tenant's acts or a force majeure, then Landlord
shall afford Tenant a credit toward the Fixed Rent due hereunder equal
to $7,750 for each day that the Commencement Date is delayed beyond
April 1, 2001."
(b) Schedule A of the Sublease is amended by deleting all references
to "Room 1206" and "Room 1208" therefrom so that the "Subleased Premises" will
hereafter exclude the Surrendered Premises.
(c) The first two paragraphs of Paragraph 9 of the Sublease are hereby
deleted and the following text is substituted in its place:
"RENT. Subtenant shall pay to Sublessor rent (the "Fixed Rent")
through the end of the Sublease Term at the following rates:
i. from the Commencement Date through December 31, 2001, at the
annual rate of $2,828,980;
ii. from January 1, 2002 through December 31, 2002, at the
annual rate of $2,828,980;
iii. from January 1, 2003 through December 31, 2003, at the
annual rate of $2,893,275;
iv. from January 1, 2004 through December 31, 2004, at the
annual rate of $2,893,275;
v. from January 1, 2005 through December 31, 2005, at the
annual rate of $2,957,570; and
vi. from January 1, 2006 through the Termination Date, at the
annual rate of $2,957,570.
The Fixed Rent shall be payable in equal monthly installments in advance on the
first day of each month during the Sublease Term.
"Provided Subtenant is not in default under any of the terms of this
Sublease, Subtenant shall be entitled to a credit against the Fixed Rent in the
amount of $235,748 for each of the first three months of the Sublease Term and
$117,874 for the fourth month of the Sublease Term."
-2-
<PAGE>
(d) Paragraph 11(a)(i) of the Sublease is hereby deleted and the
following text substituted in its place:
"for the purpose of this Sublease, "Base Tax" shall mean the Taxes (as
defined in the Main Lease) for the calendar year 2000, and "Tenant's
Proportionate Share" shall be 15.551%;"
(e) Paragraph 11(b)(ii) of the Sublease is hereby deleted and the
following text is substituted in its place:
"the minimum monthly electricity charge, as set forth in Insert 43 and
the last paragraph of Article 65 shall be $15,893;"
(f) Paragraph 11 (d) of the Sublease is hereby deleted and the
following text is substituted in its place:
"Local Laws. Subtenant shall pay to Sublessor, as Additional Rent, the
amounts payable by Sublessor under Article 37 of the Main Lease, with
the following change: the percentage figure in the penultimate line
thereof is changed to 15.551%."
(g) Paragraph 33(a) of the Sublease is hereby deleted and the
following text is substituted in its place:
"(a) Simultaneously with the execution of this Sublease, Subtenant
shall deposit the sum of at least Four Million Three Hundred Sixty
Five Thousand ($4,365,000) Dollars with Sublessor ("Cash Deposit") as
security for the full and faithful performance and observance by
Subtenant of Subtenant's covenants or obligations under this Sublease
(the "Security Deposit"). Sublessor may invest the Cash Deposit in a
one-year certificate of deposit (the "CD") with HSBC Bank USA and
provided Subtenant is not in default under this Sublease and upon
Subtenant's request, Sublessor shall pay to Subtenant, not more than
once a year, the interest earned on the CD. So long as Subtenant is
not in default under any of its obligations under this Sublease, the
required amount of Cash Deposit shall decrease by $181,850 per month,
commencing on August 1, 2004 (but the required amount of the Cash
Deposit shall never be less than $500,000)."
5. ADDITIONAL RENT CREDIT. Provided Subtenant is not in default under
any of the terms of the Sublease, Subtenant shall be entitled to a credit
against Fixed Rent in the amount of $100,000 for the fourth month of the
Sublease Term.
6. FURNITURE. Landlord agrees to leave in the Demised Premises, and
hereby conveys to Subtenant without representation, warranty or recourse of any
kind whatsoever, any and all of Landlord's moveable furniture and partitions to
the extent currently located in the Demised Premises (other than the furniture
in the offices on the ninth floor thereof, which Landlord may remove from the
Demised Premises and retain ownership of). Landlord and Tenant agree that the
foregoing conveyance is made without additional consideration, but Tenant shall
be solely responsible for the payment of any sales or conveyance taxes in
connection therewith.
-3-
<PAGE>
7. NO OTHER MODIFICATION. Except as specifically amended by this
Agreement, the Sublease remains in full force and effect, without modification
or amendment in any respect, and is hereby ratified and reaffirmed. In the event
of a conflict between the terms of the Sublease and the terms of this Agreement,
the terms of this Agreement shall control. References in the Sublease to "this
Sublease" shall be deemed to mean the Sublease as amended by this Agreement.
8. BROKERS. Landlord and Tenant represent and warrant to each other
that no broker was involved in the transaction contemplated hereby, other than
the brokers involved in the Sublease (neither of whom shall be entitled to any
commission or other compensation with regard hereto).
IN WITNESS WHEREOF, Landlord and Tenant have executed this Agreement
as of the day and year first above written.
LANDLORD: HSBC BANK USA
By: /s/ Michael L. Gembecki
-----------------------
Michael L. Gembecki
Vice President
TENANT: MARVEL ENTERPRISES,INC.
By:Allen S. Lipson
-----------------
Allen S. Lipson
Vice President