New York-New York-40 East 52nd Street Lease - 40 East 52nd Street LP and BlackRock Inc.
AGREEMENT OF LEASE
Between
40 EAST 52ND STREET L.P.,
Owner
and
BLACKROCK, INC.,
Tenant
Premises
40 East 52nd Street
New York, New York
Dated: May 3, 2000
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TABLE OF CONTENTS
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ARTICLE 1 DEMISED PREMISES, TERM, RENTS.......................................... 1
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ARTICLE 2 USE AND OCCUPANCY...................................................... 3
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ARTICLE 3 ALTERATIONS............................................................ 4
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ARTICLE 4 OWNERSHIP OF IMPROVEMENTS.............................................. 15
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ARTICLE 5 REPAIRS................................................................ 15
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ARTICLE 6 COMPLIANCE WITH LAWS................................................... 16
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ARTICLE 7 SUBORDINATION, ATTORNMENT, ETC......................................... 19
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ARTICLE 8 PROPERTY LOSS, ETC..................................................... 23
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ARTICLE 9 DESTRUCTION-FIRE OR OTHER CASUALTY..................................... 23
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ARTICLE 10 EMINENT DOMAIN......................................................... 26
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ARTICLE 11 ASSIGNMENT AND SUBLETTING.............................................. 27
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ARTICLE 12 OWNER'S INITIAL WORK................................................... 40
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ARTICLE 13 ACCESS TO DEMISED PREMISES............................................. 41
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ARTICLE 14 VAULT SPACE............................................................ 43
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ARTICLE 15 CERTIFICATE OF OCCUPANCY............................................... 43
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ARTICLE 16 DEFAULT................................................................ 43
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ARTICLE 17 REMEDIES............................................................... 45
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ARTICLE 18 DAMAGES................................................................ 46
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ARTICLE 19 FEES AND EXPENSES; INDEMNITY........................................... 47
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ARTICLE 20 ENTIRE AGREEMENT....................................................... 49
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ARTICLE 21 END OF TERM............................................................ 49
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ARTICLE 22 QUIET ENJOYMENT........................................................ 50
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ARTICLE 23 ESCALATION............................................................. 50
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TABLE OF CONTENTS CONTINUED
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ARTICLE 24 NO WAIVER............................................................ 59
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ARTICLE 25 MUTUAL WAIVER OF TRIAL BY JURY........................................ 60
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ARTICLE 26 INABILITY TO PERFORM.................................................. 60
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ARTICLE 27 NOTICES............................................................... 61
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ARTICLE 28 PARTNERSHIP TENANT.................................................... 61
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ARTICLE 29 UTILITIES AND SERVICES................................................ 62
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ARTICLE 30 TABLE OF CONTENTS, ETC................................................ 67
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ARTICLE 31 MISCELLANEOUS DEFINITIONS, SEVERABILITY AND
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INTERPRETATION PROVISIONS............................................. 68
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ARTICLE 32 ADJACENT EXCAVATION................................................... 68
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ARTICLE 33 BUILDING RULES........................................................ 68
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ARTICLE 34 BROKER................................................................ 69
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ARTICLE 35 INTENTIONALLY DELETED................................................. 69
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ARTICLE 36 ARBITRATION, ETC...................................................... 69
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ARTICLE 37 PARTIES BOUND......................................................... 70
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ARTICLE 38 ADDITIONAL SPACE...................................................... 70
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ARTICLE 39 OPTION FOR FIFTH YEAR ADDITIONAL SPACE................................ 74
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ARTICLE 40 OPTION FOR TENTH YEAR ADDITIONAL SPACE................................ 79
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ARTICLE 41 RIGHTS FOR ADDITIONAL OPTION SPACES................................... 81
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ARTICLE 42 TENANT'S SINGLE OPTION TO RENEW....................................... 84
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ARTICLE 43 NAME OF BUILDING...................................................... 85
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ARTICLE 44 MEMORANDUM OF LEASE................................................... 86
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ARTICLE 45 ACCELERATION OF ADDITIONAL SPACES..................................... 87
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ARTICLE 46 GENERATOR SPACE....................................................... 88
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SCHEDULE A Building Rules
SCHEDULE B Cleaning Services to be Furnished by Owner
SCHEDULE C Rentable Square Footage Schedule
EXHIBIT 1 Floor Plan of Basement Space
EXHIBIT 2 Description of Shaft Space
EXHIBIT 3 List of Approved Contractors
EXHIBIT 4 Description of Tenant's Satellite Equipment
EXHIBIT 5 Description of Tenant's Reception Desk
EXHIBIT 6 [Intentionally Deleted]
EXHIBIT 7 Tenant's Emergency contact list
EXHIBIT 8 Description of Tenant's exterior and lobby signs
EXHIBIT 9 Floor Plan of Generator Space
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LEASE dated as of the 3rd day of May, 2000, between 40 EAST 52ND
STREET L.P., a Delaware limited partnership having its principal office at 345
Park Avenue, Borough of Manhattan, City, County, and State of New York, as
landlord (referred to as "Owner"), and BLACKROCK, INC., a Delaware corporation
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having its principal office at 345 Park Avenue, Borough of Manhattan, City,
County and State of New York, as tenant (referred to as "Tenant").
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W I T N E S S E T H:
Owner and Tenant hereby covenant and agree as follows:
ARTICLE 1
DEMISED PREMISES, TERM, RENTS
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Section 1.01. Demised Premises: Owner hereby leases to Tenant and
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Tenant hereby hires from Owner the entire second (2/nd/) floor, in the building
located on East 52nd Street and East 51st Street between Park Avenue and Madison
Avenue known as 40 East 52nd Street, in the Borough of Manhattan, City of New
York (said building is referred to as the "Building", and the Building together
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with the plot of land upon which it stands and the development rights (referred
to as the "Development Rights") conveyed in a deed dated January 4, 1984 from 39
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East 51st Street Corporation to Owner recorded in Reel 52, Page 566 of the New
York County Register's Office is referred to collectively as the "Real
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Property"), at the annual rental rate or rates set forth in Section 1.03, and
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upon and subject to all of the terms, covenants and conditions contained in this
Lease. The premises leased to Tenant, together with all appurtenances,
fixtures, improvements, additions and other property attached thereto or
installed therein at the commencement of, or at any time during, the term of
this Lease, other than Tenant's Personal Property (as defined in Article 4), are
referred to, collectively, as the "Demised Premises".
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Section 1.02. Demised Term: A. The Demised Premises are leased for
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a term (referred to as the "Demised Term") to commence on May 1, 2000 and to end
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on the last day of the calendar month in which the date immediately preceding
the date which is six (6) months next following the fifteenth (15/th/)
anniversary of the Additional Space Commencement Date (as defined in Section
38.01) shall occur, unless the Demised Term shall sooner terminate pursuant to
any of the terms, covenants or conditions of this Lease or pursuant to law.
B. The date upon which the Demised
Term shall commence pursuant to Subsection A of this Section referred to as the
"Commencement Date", and the date fixed pursuant to said Subsection A as the
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date upon which the Demised Term shall end is referred to as the "Expiration
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Date".
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C. Tenant waives any right to rescind
this Lease under Section 223-a of the New York Real Property Law or any
successor statute of similar import then in force and further waives the right
to recover any damages which may result from Owner's failure to deliver
possession of the Demised Premises on the date set forth in Subsection A of this
Section for the commencement of the Demised Term.
D. After the determination of the
Commencement Date, Tenant agrees, upon demand of Owner, to execute, acknowledge
and deliver to Owner, an instrument, in form reasonably satisfactory to Owner,
setting forth said Commencement Date, the Expiration Date and the date upon
which rent shall commence pursuant to the provisions of this Lease.
Section 1.03. Fixed Rent: A. This Lease is made at the following
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annual rental rates (referred to as "Fixed Rent"):
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1
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1. NINE HUNDRED FIFTY-SIX
THOUSAND SIX HUNDRED FIFTY AND 00/100 ($956,650.000) DOLLARS with respect to the
Period ("First Rent Period") from the Commencement Date to the last day of the
calendar month in which the day immediately preceding the date which is six (6)
months next following the fifth (5/th/) anniversary of the Additional Space
Commencement Date (as defined in Section 38.01) shall occur;
2. ONE MILLION THIRTY-THREE ONE
HUNDRED EIGHTY-TWO AND 00/100 ($1,033,182.00) DOLLARS with respect to the next
five (5) years of the Demised Term ("Second Rent Period");
3. ONE MILLION ONE HUNDRED
TWENTY-EIGHT THOUSAND EIGHT HUNDRED FORTY-SEVEN AND 00/100 ($1,128,847.00)
DOLLARS with respect to the remainder of the Demised Term ("Third Rent Period").
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B. The Fixed Rent, any increases in
the Fixed Rent and any additional rent payable pursuant to the provisions of
this Lease shall be payable by Tenant to Owner at its office (or at such other
place as Owner may designate in a notice to Tenant) in lawful money of the
United States which shall be legal tender in payment of all debts and dues,
public and private, at the time of payment or by Tenant's good check drawn on a
bank or trust company whose principal office is located in New York City and
which is a member of the New York Clearinghouse Association, without prior
demand therefor and without any offset or deduction whatsoever except as
otherwise specifically provided in this Lease. The Fixed Rent shall be payable
in equal monthly installments, in advance, on the first (1st) day of each month
during the Demised Term (except as otherwise provided in Subsection C of this
Section) as follows:
1. SEVENTY-NINE THOUSAND SEVEN
HUNDRED TWENTY AND 83/100 ($79,720.83) DOLLARS with respect to the First Rent
Period;
2. EIGHTY-SIX THOUSAND NINETY-
EIGHT AND 50/100 ($86,098.50) DOLLARS with respect to the Second Rent Period;
and
3. NINETY-FOUR THOUSAND SEVENTY
AND 58/100 ($94,070.58) DOLLARS with respect to the Third Rent Period.
C. In the event that the Rent
Commencement Date (as defined in Section 1.05) shall occur on a date other than
the first (1st) day of any calendar month, Tenant shall pay to Owner, on the
Rent Commencement Date, a sum equal to TWO THOUSAND SIX HUNDRED FIFTY-SEVEN AND
36/100 ($2,657.36) DOLLARS, multiplied by the number of calendar days in the
period from the Rent Commencement Date to the last day of the month in which the
Rent Commencement Date shall occur, both inclusive. Such payment shall
constitute payment of the Fixed Rent for the period from the Rent Commencement
Date to and including the last day of the month in which the Rent Commencement
Date shall occur.
Section 1.04. Tenant's General Covenant: Tenant covenants (i) to pay
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the Fixed Rent, any increases in the Fixed Rent, and any additional rent payable
pursuant to the provisions of this Lease, and (ii) to observe and perform, and
to permit no violation of, the terms, covenants and conditions of this Lease on
Tenant's part to be observed and performed.
Section 1.05. Rent Holiday: Notwithstanding anything to the contrary
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contained in the Lease, Tenant shall not be required to pay any portion of the
Fixed Rent, or increases therein pursuant to Article 23, with respect to the
period (the "Rent Holiday Period") from the Commencement Date to and including
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the date one hundred eighty (180) days next following the Commencement Date but
during such period of one hundred eighty (180 ) days Tenant shall otherwise be
required to comply with all of the other terms, covenants and conditions of this
Lease on
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Tenant's part to be observed and performed. The date next following the
expiration of the Rent Holiday Period is referred to as the "Rent Commencement
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Date".
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Section 1.06. Escalation Holiday. Notwithstanding anything to the
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contrary contained in this Lease, Tenant shall not be required to pay any
portion of the increases in Fixed Rent pursuant to Article 23, with respect to
the period (the "Escalation Holiday Period") from the Rent Commencement Date to
and including the date three hundred sixty-five (365) days next following the
Rent Commencement Date but during such period of three hundred sixty-five (365)
days Tenant shall otherwise be required to comply with all of the other terms,
covenants and conditions of this Lease on Tenant's part to be observed and
performed including, but not limited to Section 1.03.
Section 1.07. Intentionally Deleted.
Section 1.08. In the event that solely as a result of any violation
of record of any Legal Requirement with respect to any public portion of the
Building ("Existing Violation") Tenant is unable to obtain a so-called "sign-
off" from the New York City Department of Buildings with respect to Tenant's
Initial Installation, the Rent Commencement Date shall be extended one (1) day
for each day that Tenant is unable to (and does not) occupy the Demised Premises
beyond the date that Tenant would have been able to occupy the Demised Premises
had a "sign-off" been issued but for the existence of an Existing Violation.
Section 1.09. Intentionally Deleted.
Section 1.10. In the event that, solely as a result of a delay of the
Commencement Date or Additional Space Commencement Date beyond May 1, 2000 and
September 1, 2001, respectively, Tenant holds over beyond the expiration of the
term of any direct lease (in contradistinction to any sublease) between 345 Park
Avenue L.P. and Tenant affecting space at 345 Park Avenue, New York, New York,
Owner agrees to indemnify and save Tenant harmless of and from any Fixed Rent
paid by Tenant to 345 Park Avenue L.P. in excess of the Fixed Rent payable by
Tenant to 345 Park Avenue L.P. as of the expiration of any such lease, i.e. by
virtue of the foregoing indemnity, the Fixed Rent payable by Tenant to 345 Park
Avenue L.P. during any such holdover period shall not be increased above the
Fixed Rent in effect as of the day immediately prior to the expiration date
thereunder.
ARTICLE 2
USE AND OCCUPANCY
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Section 2.01. General Covenant of Use: Tenant shall use and occupy
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the Demised Premises for the following purpose: Executive, general,
administrative and sales offices of Tenant and any permitted subtenants and
occupants, including, but not limited to, general, administrative and executive
offices. Incidental thereto, Tenant may use portions of the Demised Premises
for: the operation of a trading room; the operating of dining, pantry and bar
facilities and vending machines for soft drinks, candy and other items commonly
sold in such vending machines, the operation of an infirmary, a health and
fitness facility, a petty cash and ATM facility solely for the use of Tenant's
partners and employees, a travel agency solely for bookings of Tenant's partners
and employees, a print shop (which does not constitute a manufacturing use under
any Legal Requirements) solely for Tenant's work product, concessions and
franchises providing services solely to Tenant and its guests, a childcare
facility, an auditorium, board rooms, libraries, training rooms and facilities,
audiovisual and closed circuit television facilities, messenger and mailroom
facilities, reproduction and copying facilities (provided that such use does not
constitute a manufacturing use under Legal Requirements), word processing
centers, computer and communications facilities, pantries, file rooms, meeting
and conference centers and rooms, employee kitchens, cafeterias and dining rooms
all as ancillary or incidental to the use of the Demised Premises for executive,
general and administrative offices, and all for service only to Tenant and its
employees and business agents, but not for the general public; and the operation
of Tenant's business machines, including, but not limited to, computers,
duplicating, telecommunications and audio visual equipment normally used
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in general offices; provided that (i) none of the uses set forth herein shall
violate any Certificate of Occupancy covering the Demised Premises or any Legal
Requirements and (ii) such uses and all installation required thereby shall be
in accordance with the provisions of this Lease.
Section 2.02. No Adverse Use: Tenant shall not use or occupy, or
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permit the use or occupancy of, the Demised Premises or any part thereof, for
any purpose other than the purpose specifically set forth in Section 2.01, or in
any manner which, in Owner's judgment, (a) shall adversely affect or interfere
with (i) any services required to be furnished by Owner to Tenant or to any
other tenant or occupant of the Building, or (ii) the proper and economical
rendition of any such service, or (iii) the use or enjoyment of any part of the
Building by any other tenant or occupant, or (b) shall tend to impair the
character or dignity of the Building.
ARTICLE 3
ALTERATIONS
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Section 3.01. General Alteration Covenants: Tenant shall not make or
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perform, or permit the making or performance of, any alterations, installations,
improvements, additions or other physical changes in or about the Demised
Premises (referred to collectively, as "Alterations" and individually as an
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"Alteration") without Owner's prior consent in each instance. Owner agrees not
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unreasonably to withhold or delay its consent to any non-structural Alterations
proposed to be made by Tenant to adapt the Demised Premises for Tenant's
business purposes. Notwithstanding the foregoing provisions of this Section or
Owner's consent to any Alterations, all Alterations shall be made and performed
in conformity with and subject to the following provisions:
A. All Alterations shall be made and performed at
Tenant's sole cost and expense and at such time and in such manner as Owner may,
from time to time, reasonably designate;
B. No Alteration shall adversely affect the
structural integrity of the Building;
C. Alterations shall be made only by contractors or
mechanics approved by Owner, such approval not unreasonably to be withheld
(notwithstanding the foregoing, all Alterations requiring mechanics in trades
with respect to which Owner has adopted or may hereafter adopt a list or lists
of approved contractors shall be made only by contractors selected by Tenant
from such list or lists). Owner hereby consents to the performance of Tenant's
Initial Installation by the contractors set forth on Exhibit 3;
D. No Alteration shall affect any part of the
Building other than the Demised Premises or adversely affect any service
required to be furnished by Owner to Tenant or to any other tenant or occupant
of the Building (including, without limitation, the Building-wide standard
systems required to provide elevator, heat, ventilation, air-conditioning and
electrical and plumbing services in the Building);
E. No Alteration shall reduce the value or utility of
the Building or any portion thereof;
F. No Alteration shall affect the Certificate of
Occupancy for the Building or the Demised Premises;
G. No Alteration shall affect the outside appearance
of the Building or the color or style of any venetian blinds (except that Tenant
may remove any venetian blinds provided that they are promptly replaced by
Tenant with blinds of a similar type, material and color);
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H. All business machines and mechanical equipment
shall be placed and maintained by Tenant in settings sufficient, in Owner's
reasonable judgment, to absorb and prevent vibration, noise and annoyance to
other tenants or occupants of the Building;
I. Tenant shall not be required to submit plans and
specifications to Owner with respect to any Alterations which, pursuant to Legal
Requirements, do not require the filing of plans and specifications with the New
York City Building Department, but in such cases Tenant shall submit to Owner
information with respect to such Alterations in reasonably sufficient detail to
enable Owner to determine the nature and extent of the work to be performed;
before Tenant commences any Alterations which do require such filing with the
New York City Building Department, however, Tenant shall submit to Owner for
Owner's approval, which shall not be unreasonably withheld, delayed or
conditioned, detailed plans and specifications stamped by Tenant's architect
(including layout, architectural, mechanical and structural drawings); Owner
shall respond to Tenant's request for approval of such plans and specifications
within ten (10) business days for any such Alteration affecting one (1) floor or
less (with such ten (10) business day period extended to fifteen (15) business
days with respect to any Alteration which affects more than one (1) floor);
Owner shall respond to re-submissions within five (5) business days; Owner's
failure to respond within the above-mentioned time periods shall be deemed
Owner's approval provided Tenant shall have accompanied the submission of its
plans and specifications with a notice stating in bold capital letters that if
Owner does not respond to Tenant's submission within the applicable time period,
such plans and specifications shall be deemed approved by Owner; any dispute as
to the reasonability of Owner's refusal to approve such plans and specifications
shall be determined by arbitration in accordance with the provisions of Article
36; in cases where Owner's consent to a particular Alteration is not required
pursuant to the provisions of this Lease but where Tenant must submit such plans
and specifications for Owner's review, such review shall relate merely to the
manner in which the Alterations therefor shall be performed and not to Tenant's
right to perform such Alterations; following the completion of each Alteration
requiring a filing with the New York City Building Department, Tenant shall
submit to Owner architectural computerized "as built" drawing file for each
floor of the Demised Premises being altered; such file will be in DXF format (or
successor technology) and contain, on a separate layer, all ceiling-height
partitions and doors within each floor of the Demised Premises being altered.
With respect to the submission by Tenant of its plans and specifications, Owner
will endeavor to review portions thereof as they are submitted to Owner in order
to advise Tenant as to whether Owner will agree to the concept involved, without
affecting any Owner's rights to approve the complete plans and specifications
which Owner has in accordance with the provisions of this Lease;
J. Prior to the commencement of each proposed
Alteration, Tenant shall have procured and paid for and exhibited to Owner, so
far as the same may be required from time to time, all permits, approvals and
authorizations of all Governmental Authorities (as defined in Section 6.01.)
having or claiming jurisdiction;
K. Prior to the commencement of each proposed
Alteration, Tenant shall furnish to Owner duplicate original policies of
worker's compensation insurance covering all persons to be employed in
connection with such Alteration, including those to be employed by all
contractors and subcontractors, and of comprehensive public liability insurance
(including property damage coverage) in which Owner, its agents, the holder of
any Mortgage (as defined in Section 7.01.) and any lessor under any Superior
Lease (as defined in Section 7.01.) shall be named as parties insured, which
policies shall be issued by companies, and shall be in form and amounts,
reasonably satisfactory to Owner and shall be maintained by Tenant until the
completion of such Alteration;
L. In the event Owner or its agents employ any
independent architect or engineer to examine any plans or specifications
submitted by Tenant to Owner in connection with any proposed Alteration, Tenant
agrees to pay to Owner a sum equal to any reasonable out of pocket fees actually
incurred by Owner in connection therewith.
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M. All fireproof wood test reports, electrical and
air conditioning certificates, and all other permits, approvals and certificates
required by all Governmental Authorities shall be timely obtained by Tenant and
submitted to Owner;
N. All Alterations, once commenced, shall be made
promptly and in a good and workmanlike manner;
O. Notwithstanding Owner's approval of plans and
specifications for any Alteration, all Alterations shall be made and performed
in full compliance with all Legal Requirements (as defined in Section 6.01.) and
with all applicable rules, orders, regulations and requirements of the New York
Board of Fire Underwriters and the New York Fire Insurance Rating Organization
or any similar body;
P. All Alterations shall be made and performed in
accordance with the Building Rules and Building Rules for Alterations, a copy of
which has been delivered to Tenant prior to the date of this Lease;
Q. All materials and equipment to be installed,
incorporated or located in the Demised Premises as a result of all Alterations
shall be first quality;
R. No materials or equipment shall be subject to any
lien, encumbrance, chattel mortgage or title retention or security agreement of
any kind;
S. Tenant, before commencement of each Alteration
costing in excess of SEVEN HUNDRED FIFTY THOUSAND AND 00/100 ($750,000.00)
DOLLARS, shall furnish to Owner a performance bond or other security
satisfactory to Owner, in an amount at least equal to the estimated cost of such
Alteration, guaranteeing the performance and payment thereof except, if Tenant
is a publicly traded company with a net worth equal to $25,000,000, no such bond
shall be required;
T. Following the completion of each Alteration,
Tenant, at Tenant's expense, shall obtain certificates of final approval of such
Alteration required by any Governmental Authority and shall furnish Owner with
copies thereof.
U. Tenant agrees that Tenant will not install, affix,
add or paint in or on, nor permit, any work of visual art (as defined in the
Federal Visual Artists' Rights Act of 1990 or any successor law of similar
import) or other Alteration to be installed in or on, or affixed, added to, or
painted on, the interior or exterior of the Demised Premises, or any part
thereof, including, but not limited to, the walls, floors, ceilings, doors,
windows, fixtures and on land included as part of the Demised Premises, which
work of visual art or other Alteration would, under the provisions of the
Federal Visual Artists' Rights Act of 1990, or any successor law of similar
import, require the consent of the author or artist of such work or Alteration
before the same could be removed, modified, destroyed or demolished.
Section 3.02. No Consent to Contractor/No Mechanics Lien: Nothing in
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this Lease shall be deemed or construed in any way as constituting the consent
or request of Owner, express or implied, by inference or otherwise, to any
contractor, subcontractor, laborer or materialmen, for the performance of any
labor or the furnishing of any material for any specific Alteration to, or
repair of, the Demised Premises, the Building, or any part of either. Any
mechanic's or other lien filed against the Demised Premises or the Building or
the Real Property for work claimed to have been done for, or materials claimed
to have been furnished to, Tenant or any person claiming through or under Tenant
or based upon any act or omission or alleged act or omission of Tenant or any
such person shall be discharged (by bonding or otherwise) by Tenant, at Tenant's
sole cost and expense, within thirty (30) days after the filing of such lien.
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Section 3.03. Labor Harmony: Tenant shall not, at any time prior to
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or during the Demised Term, directly or indirectly employ, or permit the
employment of, any contractor, mechanic or laborer in the Demised Premises,
whether in connection with any Alteration or otherwise, if such employment will
interfere or cause any conflict with other contractors, mechanics, or laborers
engaged in the construction, maintenance or operation of the Building by Owner,
Tenant or others. In the event of any such interference or conflict, Tenant,
promptly after receipt from Owner of written notice of such interference or
conflict, which notice shall set forth the perceived source or cause thereof,
shall cause all contractors, mechanics or laborers causing such interference or
conflict to leave the Building immediately.
Section 3.04. Compliance with Fire Safety: Without in any way
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limiting the generality of the provisions of Section 3.01, all Alterations shall
be made and performed in full compliance with all standards and practices
adopted by Owner for fire safety in the Building. No Alteration shall affect
all or any part of any Class E Fire Alarm and Communication system installed in
the Demised Premises, except that in connection with any such Alteration Tenant
may relocate certain components of such system, provided (i) such relocation
shall be performed in a manner first reasonably approved by Owner, (ii) the new
location of any such component shall be first reasonably approved by Owner,
which approval shall not be unreasonably withheld (iii) prior to any such
relocation Tenant shall submit to Owner detailed plans and specifications
therefor which shall be first reasonably approved by Owner and (iv) Owner shall
have the election of relocating such components either by itself or by its
contractors, in which event all reasonable expenses incurred by Owner shall be
reimbursed by Tenant upon ten (10) days' demand of Owner, as additional rent.
Section 3.05. Sprinklers: In the event that Tenant performs any
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Alterations in the Demised Premises, Tenant, as part of such Alterations, shall
be required to make all modifications to the existing sprinkler system in the
Demised Premises and in connection therewith the following provisions of this
Section shall apply: (i) any such modifications to the sprinkler system shall
comply with all applicable laws, orders, rules and regulations; (ii) the
supplying and installing of any such modifications to the sprinkler system shall
be made in accordance with the provisions of this Lease, including but not
limited to the provisions of this Article and Article 6 and the type, brand,
location and manner of installation of such modifications to the sprinkler
system shall be subject to Owner's prior approval; and (iii) Tenant shall make
all repairs and replacements, as and when necessary, to such modifications to
the sprinkler system and any replacements thereof. Notwithstanding the
aforesaid provisions of this Section, Owner shall have the election of supplying
and installing the modifications to such sprinkler system either by itself or by
its agents or contractors, in which event all reasonable out-of-pocket costs and
expenses incurred by Owner in connection with supplying and installing the
modifications to such sprinkler system and any repairs or replacements of the
modifications to such sprinkler system and any replacements thereof made by
Owner, at Owner's election, shall be paid by Tenant to Owner within thirty (30)
days next following the rendition of a statement thereof by Owner to Tenant.
Notwithstanding anything contained in this Lease to the contrary, such sprinkler
system, or any modifications to and replacement thereof and any installments in
connection therewith, whether made by Tenant or Owner, shall upon expiration or
sooner termination of the Demised Term be deemed the property of Owner.
Section 3.06. Hazardous Material: If any Legal Requirement of any
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Governmental Authority requires that any hazardous material contained in or
about the Demised Premises installed by Tenant be removed or dealt with in any
particular manner in connection with any Alterations of the Demised Premises or
otherwise, then it shall be Tenant's obligation, at Tenant's expense, to remove
or so deal with such hazardous material in accordance with all such laws,
orders, rules and regulations. In the event Tenant is required to remove or so
deal with such hazardous material in accordance with the provisions of the
foregoing sentence then, notwithstanding anything to the contrary contained
herein, Owner, at Owner's election, shall have the option to itself remove or so
deal with such hazardous material and, in such event, Tenant shall pay to Owner
all of Owner's out-of-pocket reasonable costs in connection therewith within
thirty (30) days next following the rendition of a statement thereof by Owner to
Tenant.
Section 3.07. Dispute Resolution: Any dispute with respect to the
------------------
reasonability of any failure or refusal of Owner to grant its consent or
approval to any request for such consent or approval pursuant to the
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provisions of Section 3.01 with respect to which request Owner has agreed, in
such Section not unreasonably to withhold such consent or approval, shall be
determined by arbitration in accordance with the provisions of Article 36.
Section 3.08. Fire Alarm and Communication System Connection Fees:
---------------------------------------------------
A. In the event that Tenant, pursuant to the provisions of this Lease,
including, but not limited to, the provisions of this Article 3 and Article 6,
connects any of the following equipment to any Class E Fire Alarm and
Communication system installed in the Demised Premises, Tenant shall pay to
Owner as a one (1) time connection fee the following sums set forth opposite the
equipment listed below (which sums shall be subject to increases due to
increases in the cost to Owner of operating and maintaining such Class E Fire
Alarm and Communication system over such costs on the date of this Lease):
A. Speakers in excess of 4 per
floor of the Demised Premises (or
if the Demised Premises contain
less than one (1) floor, in excess
of four in the Demised Premises) $500.00 per device
B. Strobe Lights (single unit) $100.00 per device
C. Combination Speaker/Strobe
light $250.00 per device
D. Duct Detectors (supplementary
air conditioning systems) $500.00 per point
E. Smoke Detectors (multi-purpose) $500.00 per point
F. Preaction Sprinkler System:
waterflow $500.00 per point
tamper $500.00 per point
G. Warden Phone (additional) $1,000.00 per unit
H. Fail Safe Door Release $250.00 per connection
B. Notwithstanding the foregoing, Tenant shall not be
required to pay any connection fee with respect to any of such equipment
existing in the Demised Premises as of the date of this Lease.
C. Owner shall throughout the term of this Lease, at
no additional cost to Tenant, except with respect to Tenant's subsystems within
the Demised Premises, be obligated to test and maintain any equipment which is
connected to the Class E Fire Alarm and Communication System in accordance with
this Section.
Section 3.09. Tenant's Initial Installation. Promptly after the
-----------------------------
Commencement Date and promptly after the Additional Space Commencement Date (as
defined in Article 38), respectively, Tenant shall, at Tenant's cost and
expense, perform various Alterations in the Demised Premises and the Additional
Space (as defined in Article 38), respectively, required for Tenant's occupancy
and use thereof and conduct of its business therein. Such Alterations (referred
to, collectively, as "Tenant's Initial Installation") shall be made and
-----------------------------
performed in accordance with the provisions of this Lease, including, without
limitation, the provisions of this Article 3 and Article 6 hereof. Tenant shall
prosecute Tenant's Initial Installation to completion with all reasonable
diligence.
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Section 3.10. Owner's Contribution. A. Subject to the provisions
--------------------
and requirements of this Article 3, and provided that Tenant is not then in
default under any of the terms, covenants or conditions of this Lease on the
part of Tenant to be observed or performed beyond applicable grace periods,
Owner shall contribute the sum of not more than FOUR MILLION ONE HUNDRED NINETY-
THREE THOUSAND NINE HUNDRED SEVENTY-FIVE and 00/100 ($4,193,975.00) DOLLARS in
the aggregate toward the cost and expense actually incurred by Tenant with
respect to Tenant's Initial Installation including the cost of all
architectural, engineering and designers fees incurred by Tenant in connection
therewith. Owner's contribution on account of Tenant's Initial Installation is
referred to as "Owner's Work Contribution". Irrespective of the actual cost and
-------------------------
expense of Tenant's Initial Installation, in no event shall Owner's Work
Contribution exceed the aggregate sum of FOUR MILLION ONE HUNDRED NINETY-THREE
THOUSAND NINE HUNDRED SEVENTY-FIVE AND 00/100 ($4,193,975.00) DOLLARS.
B. Provided that Tenant is not then in default under
any of the terms, covenants or conditions of this Lease on Tenant's part to be
observed and performed beyond applicable grace periods, Owner shall distribute
Owner's Work Contribution on account of Tenant's Initial Installation as the
work with respect thereto progresses, within twenty (20) days of Tenant's
submission to Owner of (i) vouchers or bills, in form reasonably acceptable to
Owner, for the cost and expense of Tenant's Initial Installation, and (ii)
partial waivers of mechanic's liens from all contractors, subcontractors,
materialmen and laborers who performed any services or delivered any materials
in connection with Tenant's Initial Installation and which services or materials
were the subject of the previous month's distribution by Owner to Tenant of
Owner's Work Contribution, provided however that (a) at no time shall Owner be
required to pay more than the value of the work in place or stored off-site, (b)
except with respect to disbursements solely for architectural and engineering
services rendered, that any such work shall comply with any plans and
specifications previously approved by Owner and shall otherwise comply with the
requirements of this Lease and Tenant's request for distribution shall be
accompanied by a certification of Tenant's architect or designer to that effect
and (c) in the event that Owner fails to distribute to Tenant an installment of
Owner's Work Contribution on or before the date that Owner is required to do so
under the terms and provisions of this Section 3.10.B., Tenant shall be entitled
to collect interest on such installment at a rate equal to two (2%) percent per
annum above the then current prime rate (as defined in Section 31.03) for the
period from the date that such installment of Owner's Work Contribution was due
until such installment is paid to Tenant. Distributions of Owner's Work
Contribution shall be made not more than monthly.
C. The making of the Owner's Work Contribution by
Owner shall constitute a single nonrecurring obligation on the part of Owner. In
the event this Lease is renewed or extended for a further term by agreement or
operation of law, Owner's obligation to give Owner's Work Contribution or any
part thereof shall not apply to any such renewal or extension.
D. If upon completion of Tenant's Initial
Installation in accordance with the plans and specifications approved by Owner
and otherwise in accordance with the provisions of this Lease and complete
payment by Tenant of all of the costs and expenses thereof there shall remain
unused portions of Owner's Work Contribution, then, provided Tenant is not in
default under any of the terms, covenants or conditions of this Lease on the
part of Tenant to be observed or performed beyond applicable grace periods, the
amount of such unused Owner's Work Contribution shall be applied as a rent
credit against the next accruing installments of Fixed Rent payable by Tenant
under this Lease.
E. Tenant acknowledges and agrees that Owner is
merely acting on behalf of Tenant in connection with the disbursement of the
Owner's Work Contribution in accordance with the provisions of this Section 3.10
to Tenant for the contractors, suppliers and materialmen employed in connection
with Tenant's Initial Installation, and that Owner shall have no obligation,
liability or responsibility to any of the contractors, suppliers or materialmen
seeking any of the Owner's Work Contribution pursuant to any of the aforesaid
contracts or agreements with such contractors, suppliers or materialmen or
otherwise, provided that Owner shall be obligated to disburse such Owner's Work
Contribution only as expressly provided by the provisions of this Section 3.10.
Nothing contained in this Section 3.10 shall relieve Tenant of any obligations
or liabilities to such contractors, suppliers or materialmen under such
contracts, agreements or otherwise. Nothing contained in this Article shall
relieve Tenant of any obligations of
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Tenant under Sections 3.02. or 3.03. of this Lease. Tenant shall indemnify Owner
and Owner's Indemnitees from all loss, cost, liability and expense, including
but not limited to reasonable counsel fees, incurred in connection with, or
arising from, any claims or actions by any contractors, suppliers or materialmen
employed in connection with Tenant's Initial Installation.
Section 3.11. Owner agrees that, if permitted by Legal Requirements,
Owner will grant to Tenant the exclusive use, at no additional cost, of the
existing emergency power system consisting of a 600kw emergency generator (the
"Generator") located on the mezzanine level of the Building and an emergency
feeder distribution system including automatic transfer switches, meters,
feeders and panels, as well as the existing 550 gallon fuel tank located in the
basement of the Building and the two (2) existing pumps in the upper pump room
of the Building all associated with the Generator. Tenant agrees to accept
possession of the generator and fuel tank in the condition in which they shall
exist on the Commencement Date. Owner shall have no responsibility for the
maintenance and repairs of the emergency power system or any components thereof
and Tenant, at Tenant's sole cost and expense, shall keep the emergency power
system and any components thereof in good condition and make all necessary
repairs and replacements thereto and to the Building occasioned thereby.
Section 3.12. Owner agrees to make available to Tenant for its
exclusive use the existing dedicated 800 amp electric riser to the fourth
(4/th/) floor portion of the Premises at no cost to Tenant except for the
payment of electricity as provided in Section 29.05. Tenant shall be
responsible for all costs incurred by Owner in making any repairs to said
electrical riser occasioned by the acts, omissions or negligence of Tenant or
any person claiming through or under Tenant.
Section 3.13. Subject to (i) the availability of power from the
public utility and any other authority having jurisdiction and (ii) the capacity
of the electrical feeders serving the Building, Owner agrees to make available
to Tenant the existing 4,000 amp panel located in the basement electrical
switchgear room at no cost to Tenant except for the payment of electricity as
provided in Section 29.05. Tenant agrees to take all actions necessary to
provide service from such panel for Tenant's non-exclusive use in accordance
with the provisions of this Lease, including but not limited to Article 3 and 6.
Owner agrees to cooperate with Tenant to activate service from such panel at
Tenant's request and to pay all actual third party fees in connection therewith.
Tenant shall be responsible for all costs incurred by Owner in making any
repairs to said electric panel and ancillary equipment occasioned by the acts,
omissions or negligence of Tenant or any person claiming through or under
Tenant. Owner shall be entitled to use any excess power which is not used by
Tenant as set forth in this Section 3.13.
Section 3.14. Owner shall make available to Tenant shaft space in the
Building in which Tenant, at Tenant's sole cost and expense, may install conduit
for Tenant's electric, voice and data requirements and connections to Tenant's
Satellite Equipment. The location of such shaft space shall be mutually agreed
upon by Owner and Tenant and Tenant shall not be required to pay any rent for
the use of the shaft space for the conduits. Tenant, by operation of the
provisions of this Section 3.14 and Section 3.22 in the aggregate, shall not be
entitled to more than Tenant's Proportionate Share of fifty (50%) percent of the
shaft space in the Building.
Section 3.15. Owner agrees, at Owner's sole cost and expense, to
refinish the exterior metal cladding of the Building from the present reddish
color to the color illustrated in the sample, a copy of which (i) has been
exhibited to Tenant and (ii) is initialed by both Owner and Tenant, with the
parties acknowledging that the actual color of the refinishing may vary slightly
from the sample without any liability on the part of Owner for any such
variance. Owner agrees to commence such refinishing on or about May 1, 2001 and
to complete such refinishing with reasonable diligence, without any obligation
to employ labor at overtime or other premium pay rates. In the event Owner
fails to substantially complete such refinishing by December 31, 2001, Tenant
shall be entitled to a rent credit of TWO HUNDRED THOUSAND and 00/100
($200,000.00) DOLLARS to be applied against the next accruing monthly
installments of Fixed Rent. In the event Owner fails to substantially complete
such refinishing by September 1, 2002, Tenant shall be entitled to a further
rent credit of ONE HUNDRED THOUSAND ($100,000.00) DOLLARS to be applied against
the next accruing monthly installments of Fixed Rent. For the purposes of this
Section, Owner
10
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shall be deemed to have substantially completed such refinishing if (a) the
extent of such refinishing not yet completed does not materially affect the
overall look of the Building as a first class office building or (b) the
refinishing has not been completed only for not more than the top two(2) floors
of the Building. The dates "December 31, 2001" and "September 1, 2002" set forth
above shall be extended by the number of days that Owner is delayed in
performing such refinishing arising by reason of any force majeure events set
forth in Section 26.01.
Section 3.16. Owner shall cooperate with Tenant, and, if necessary,
join any necessary applications to governmental bodies with respect to licenses
or permits required in connection with Alterations to be performed by Tenant,
provided that such Alterations shall be permitted by the provisions of this
Lease and provided further that Tenant shall pay all reasonable costs and
expenses incurred in connection therewith.
Section 3.17. Notwithstanding the foregoing, with respect to each
floor of the Demised Premises, Owner agrees that Tenant may, without Owner's
prior consent, make any non-structural Alterations in the Demised Premises
provided, that the aggregate estimated costs of all such Alterations with
respect to such floor shall not exceed ONE HUNDRED FIFTY THOUSAND and 00/100
($150,000.00) DOLLARS in any calendar year and provided, further that no such
Alteration shall adversely affect the electrical, plumbing, heating, ventilation
and air conditioning systems in the Building or any portion of the Building
outside the Demised Premises. Such sum of ONE HUNDRED FIFTY THOUSAND
($150,000.00) DOLLARS set forth in the preceding sentence shall be deemed
increased annually by the percentage increase in the Consumer Price Index (as
hereinafter defined) for the month in which the first anniversary of the
Commencement Date, and each subsequent anniversary date thereof, occurs over the
Consumer Price Index for the month of December, 1999. The Consumer Price Index
set forth in the immediately preceding sentence shall mean the Consumer Price
Index for Urban Wage Earners and Clerical Workers based upon the New York-
Northern New Jersey area for All Group Commodities and Items, published by the
United States Department of Labor, Bureau of Labor Statistics, or a successor
substitute index; if in any year the 1982-84 average of one hundred (100) is no
longer used as the basis of calculation, then, for the purposes of this Article,
the Consumer Price Index for such year shall be recalculated as though such
1982-84 average of one hundred (100) were still the basis of calculation of the
Consumer Price Index for such year; in the event such Consumer Price Index (or a
successor substitute index) is not available, a reliable government or other
non-partisan publication evaluating the information theretofore used in
determining the Consumer Price Index shall be used to reflect the increase in
the national cost of living.
Section 3.18. A. Installation, Maintenance, Operation and Repair
-----------------------------------------------
of Tenant's Microwave Antenna Equipment. Subject to Owner's consent and Tenant's
---------------------------------------
compliance with the provisions of this subdivision A, Tenant may install on the
roof of the Building a microwave antenna dish of Tenant not exceeding two (2)
meters in diameter at the location described on Exhibit 4 annexed hereto and
made a part hereof (said dish shall sometimes be referred to herein as the
"Dish", and together with the hereinafter defined "Tenant's Connecting
----
Equipment" and the "Tenant's Future Equipment", shall sometimes be referred to
herein, collectively, as "Tenant's Satellite Equipment"). In the event that
----------------------------
Tenant seeks to install such Tenant's Satellite Equipment, Tenant shall make a
written request for Owner's consent to the installation of Tenant's Satellite
Equipment. Such request shall include detailed plans and specifications of the
proposed Tenant's Satellite Equipment, its placement on the roof (including the
method of installation and the proposed location of Tenant's cables (referred to
herein as "Tenant's Connecting Equipment") connecting such Dish to equipment in
-----------------------------
the Demised Premises running through conduits, pipes or shafts in the Building,
the exact location of which shall be reasonably designated by Owner. Tenant
shall have the right to install Tenant's Satellite Equipment on the roof of the
Building pursuant to Tenant's request, the exact location of which shall be
approved by Owner. All of the foregoing installations of Tenant's Satellite
Equipment shall be made at Tenant's sole cost and expense and in accordance with
all the provisions of this Lease, including, but not limited to, the provisions
of this Article 3 and Article 6. Owner shall have no responsibility for the
maintenance and repair of Tenant's Satellite Equipment and Tenant, at Tenant's
sole cost and expense, shall keep all said installations of Tenant's Satellite
Equipment in good condition and make all necessary repairs and replacements
thereto and to the Building occasioned thereby. Tenant, at Tenant's cost and
expense, shall repair any damage to the Building occasioned by the installation,
maintenance, relocation or removal of such Tenant's Satellite Equipment. Tenant
further agrees that the maintenance and operation of Tenant's Satellite
Equipment shall comply with the provisions of Article 6. The
11
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installation of Tenant's Satellite Equipment shall be made on behalf of Tenant
by a contractor or contractors designated by Tenant and approved by Owner, which
approval shall not be unreasonably withheld or delayed. Tenant further
understands and agrees that the aesthetic characteristics of the Building are of
significant commercial importance to Owner and, therefore, Tenant shall ensure
that the installed appearance of Tenant's Satellite Equipment will be subject to
Owner's prior written approval.
B. End of Term. Upon the Expiration Date or sooner
-----------
termination of the Demised Term, Tenant, at Tenant's sole cost and expense,
shall remove Tenant's Satellite Equipment and make all repairs to the Building
occasioned by such removal. If Owner elects, however, to have Tenant's
Connecting Equipment remain in the Demised Premises, such installations shall
remain in the Demised Premises. Tenant's Satellite Equipment and any associated
future installations (referred to herein as "Tenant's Future Equipment") shall
-------------------------
be subject to such conditions with respect to the installation, operation and
maintenance thereof as may reasonably be imposed by Owner, including, but not
limited to, those conditions set forth in Section 3.18A.
C. (1) No Interference/Shutdown. Tenant agrees
-------------------------
that Tenant's Satellite Equipment shall be designed, operated, installed and
maintained in such a manner that it shall not (i) interfere with
telecommunication equipment existing on or in the Building at the time of
installation of Tenant's Satellite Equipment, or (ii) interfere or threaten to
interfere with the use of the roof, or if applicable "set-back", or any other
part of the Building by Owner or any tenant, licensee, user or occupant of the
Building as of the date of this Lease including the operation of communication
or computer equipment by such person or (iii) create or threaten to create any
danger to the health and safety of persons or the Building or to the environment
and all other tenants of the Building shall be deemed third party beneficiaries
of the foregoing provision with the right to enforce the same. For the purpose
hereof, such interference shall include (i) any electrical, electromagnetic or
radio frequency interference and (ii) any restrictions or limitation of any
space tenants in the Building to conduct their business therein or use or occupy
their space. If, in the judgment of Owner, any such interference or danger shall
occur or might occur as a result of the operation of Tenant's Satellite
Equipment, then Tenant shall promptly correct or cure such situation at Tenant's
sole cost and expense including Tenant's promptly ceasing operation and use of
Tenant's Satellite Equipment (except for intermittent testing on a schedule
approved by Owner) until the interference or emergency situation has been
corrected to the satisfaction of Owner.
If Tenant shall fail to promptly remedy or cure such
interference after Owner's notice to Tenant (except in the case of emergency,
when no notice from Owner to Tenant shall be required), whether by shutting down
of Tenant's Satellite Equipment or otherwise, then, Owner may act, at Tenant's
cost and expense, to shut down Tenant's Satellite Equipment to eliminate such
interference and/or correct such emergency situation and Owner shall have no
liability to Tenant as a result thereof. Any such sums due Owner from Tenant
pursuant to the provisions of this Section shall be deemed added to the Fixed
Rent and shall be deemed additional rent, paid and collectable as part of such
Fixed Rent and such obligation of Tenant shall survive the termination or
cancellation of this Lease.
(2) Owner's Relocation Right. Notwithstanding
------------------------
anything to the contrary contained herein, Owner reserves the right (referred
to herein as "Owner's Relocation Right") to require that Tenant relocate
------------------------
Tenant's Satellite Equipment, or any item thereof, to another location in or on
the Building reasonably acceptable to Tenant in the event required (i) by Legal
Requirements or (ii) in connection with the installation of a proprietary
communications network connecting buildings owned or managed by affiliated
entities of Owner. In the event that Owner exercises Owner's Relocation Right
(unless Owner's exercise of such option was by virtue of subdivision (ii) of the
preceding sentence in which event such relocation shall be at Owner's sole cost
and expense), then Tenant shall, at Tenant's cost and expense, relocate Tenant's
Satellite Equipment to such new location on or before the date set forth in
Owner's notice to Tenant of such relocation provided that such date shall not be
earlier than thirty (30) days of the date of Owner's notice to Tenant exercising
such Owner's Relocation Right.
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(3) No Owner Responsibility. Owner shall have
-----------------------
no responsibility with respect to any interference with Tenant's Satellite
Equipment. Owner agrees, however, that in the event that any other tenant in the
Building shall install any satellite equipment on the roof of the Building after
the installation by Tenant of Tenant's Satellite Equipment which shall cause any
interference with Tenant's then existing Satellite Equipment, Owner, upon
request of Tenant, shall use reasonable diligence to cause such tenant causing
such interference to cease such interference. Any interference with Tenant's
Satellite Equipment shall not be deemed to constitute an actual or constructive
eviction, in whole or in part, or entitle Tenant to any abatement or diminution
of rent, or relieve Tenant from any of its obligations under this Lease, or
impose any liability upon Owner or its agents by reason of inconvenience or
annoyance to Tenant, or injury to or interruption of Tenant's business or
otherwise. Notwithstanding any right of election on Owner's part to have
Tenant's Connecting Equipment remain in the Demised Premises as hereinabove set
forth, all other Tenant's Satellite Equipment shall, for all other purposes of
this Lease, be deemed Tenant's Personal Property.
D. Use. Tenant (or Tenant's agents, as approved or
---
authorized by Owner) shall use Tenant's Satellite Equipment solely for purposes
of providing communications services used in the operation of Tenant's business
activities set forth in Section 2.01. Tenant shall have no right to use
Tenant's Satellite Equipment for any other purpose. Without limiting the
aforesaid, Tenant is expressly forbidden to use Tenant's Satellite Equipment to
provide telecommunications services to any other person or entity other than
affiliates of Tenant or former affiliates of Tenant. Tenant acknowledges and
agrees that Owner may grant similar rights or licenses to other communication
companies or tenants of the Building to place similar telecommunications
equipment next to Tenant's Satellite Equipment on or in the Building.
E. Electricity. Owner shall have no obligation to
-----------
provide any utilities, including electrical service, for the operation of
Tenant's Satellite Equipment and Owner makes no representation as to the
availability of such utilities. Tenant shall, at Tenant's cost and expense,
provide all necessary utilities to Tenant's Satellite Equipment and shall make
its own arrangements with the public utility servicing the Building for such
electrical service.
F. Access. Tenant and Tenant's representatives,
------
approved and authorized by Owner in advance, shall have access to Tenant's
Satellite Equipment (x) during regular business hours, if access is not obtained
through other tenant spaces of the Building or (y) after regular business hours,
if access is obtained solely through other tenant spaces of the Building upon
reasonable advance notice to Owner, and, in the event of an emergency with
respect to Tenant's Satellite Equipment, upon such advance notice as is
reasonably practicable under the circumstances. Such access by Tenant shall be
subject in a manner as Owner shall reasonably designate with respect to safety
and to prevent interference with the use and operation of the Building by Owner
and the other tenants or occupants thereof.
G. Increase in Fixed Rent. In consideration for the
----------------------
rights granted to Tenant set forth in this Section 3.18, in the event that
Tenant's microwave antenna dish has a diameter in excess of eighteen (18)
inches, from and after the date of installation of Tenant's Satellite
Equipment, the Fixed Rent reserved in the Lease shall be increased by the sum of
$250.00 per month per foot of diameter.
H. For the period from the Commencement Date to the
date upon which Tenant's occupancy of portions of the Building known as 345 Park
Avenue, New York, New York (the "345 Park Building") shall expire, Tenant shall
be permitted to install on the roof of the Building a line of sight microwave
antenna (the "Temporary Microwave Antenna") not exceeding 18" in diameter to
access either the northwest or southwest corner of the 345 Park Building. Tenant
shall have the right to install the Temporary Microwave Antenna on the roof of
the Building pursuant to Tenant's request, the exact location of which shall be
approved by Owner. The installation of the Temporary Microwave Antenna shall be
made at Tenant's sole cost and expense and in accordance with all the provisions
of this Lease, including, but not limited to, the provisions of this Article 3
and Article 6. Owner shall have no responsibility for the maintenance and repair
of the Temporary Microwave Antenna. Tenant, at Tenant's sole cost and expense,
shall keep all said installations of the Temporary Microwave Antenna in good
condition and make all necessary repairs and replacements thereto and to the
Building occasioned thereby. Tenant, at Tenant's cost and expense, shall repair
any damage to the Building occasioned by the installation, maintenance, or
removal of
13
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the Temporary Microwave Antenna. Tenant further agrees that the maintenance and
operation of the Temporary Microwave Antenna shall comply with the provisions of
Article 6. The installation of the Temporary Microwave Antenna shall be made on
behalf of Tenant by a contractor or contractors designated by Tenant and
approved by Owner, which approval shall not be unreasonably withheld or delayed.
Tenant further understands and agrees that the aesthetic characteristics of the
Building are of significant commercial importance to Owner and, therefore,
Tenant shall ensure that the installed appearance of the Temporary Microwave
Antenna will be subject to Owner's prior written approval. Upon the expiration
of Tenant's lease at the 345 Park Building or sooner termination of the Demised
Term, Tenant, at Tenant's sole cost and expense, shall remove the Temporary
Microwave Antenna and make all repairs to the Building occasioned by such
removal. The Temporary Microwave Antenna shall be subject to such conditions
with respect to the installation, operation and maintenance thereof as may
reasonably be imposed by Owner, including, but not limited to, those conditions
set forth in Section 3.18A and Section 3.18C.
Section 3.19. During the performance of Tenant's Initial
Installation, Tenant shall have the right to remove any existing sprinkler loop
in the Demised Premises provided that Tenant shall, at Tenant's sole cost and
expense (i) replace the sprinkler loop during the course of Tenant's Initial
Installation and (ii) provide a fire guard watch during the period that such
sprinkler loop is inoperative. All work performed by Tenant pursuant to this
Section 3.19 shall be performed in accordance with the provisions of this Lease,
including, but not limited to, Articles 3 and 6.
Section 3.20. Owner agrees that in connection with supervising access
to the Demised Premises and security/reception therein, Tenant may install a
security/reception desk in the Building lobby at the approximate location
indicated on the plan initialed by the parties and annexed to this Lease as
Exhibit 8 with the actual location to be subject to Landlord's reasonable
approval, (provided that the actual location shall be compatible with the
overall design of the Building's lobby), which security/reception desk shall be
designed in approximately the manner set forth in Exhibit 8, but in any event in
a manner to be compatible with the overall design of the Building's lobby. Owner
shall not charge Tenant any rent for such security/reception desk. In the event
of any dispute as to the actual location or final design of the
security/reception desk, such dispute shall be determined by arbitration in the
same manner as provided as in Article 36. The foregoing installations set forth
in this Section 3.20 as well as the maintenance, repair and use thereof, shall
be made at Tenant's sole cost and expense and in accordance with all the
provisions of this Lease, including, but not limited to, the provisions of
Articles 3 and 6 notwithstanding that they are not located in the Demised
Premises. Owner shall have no responsibility for the maintenance and repair
thereof unless such repair is necessitated due to Owner's or any of Owner's
agents', employees', or contractors' negligence or wilful misconduct and Tenant,
at Tenant's sole cost and expense, shall keep all said installations in good
condition and make all necessary repairs and replacements thereto and to the
Building unless such repair is necessitated due to Owner's or any of Owner's
agents', employees' or contractors' negligence or wilful misconduct. On the
Expiration Date or any sooner termination date of the Demised Term, Tenant, at
Tenant's sole cost and expense, shall, upon request of Owner, given in writing
at least two (2) months prior to such date unless this Lease terminates prior to
the anticipated Expiration Date, in which case, such advance notice shall be
given if practicable under the circumstances, remove such installations and make
all repairs to the Building, occasioned thereby. If Owner elects to have such
installations remain in the Building, such installations shall remain in the
Building at no cost and expense to Owner or Tenant. Unless due to the negligence
or wilful misconduct of Owner or any of Owner's agents, employees or
contractors, Tenant hereby agrees to hold Owner harmless of and from and
indemnify Owner from, all loss, cost, liability, damage and reasonable expense,
including, but not limited to reasonable counsel fees and disbursements, arising
from the installation, maintenance and use of all such installations set forth
in this Section 3.20. Tenant agrees that its manner of use of the installations
set forth in this Section 3.20 shall not (a) adversely affect or interfere with
(i) any service required to be furnished by Owner to Tenant or any other tenant
or occupant of the Building or (ii) the proper and economical rendition of any
such service or (iii) the use or enjoyment of any part of the Building by any
other tenant or occupant or (b) tend to impair the character or dignity of the
Building.
Section 3.21. Owner agrees that Tenant shall have the right to
install internal staircases in the Demised Premises provided such installation
shall be subject to the provisions of this Lease, including, but not limited to
Articles 3, 6 and 21.
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Section 3.22. Tenant, at Tenant's sole cost and expense, shall have
the right to install the following:
1. Two (2) four inch (4") empty conduits with pull
boxes from the basement telco/carrier room to the
fourth (4/th/) floor data center as shown on
Exhibit 2;
2. Four (4) four (4") inch pipes feeding the second
(2/nd/) and third (3/rd/) floor satellite closets
from the satellite closet located on the fourth
(4/th/) floor. Said pipes will begin six (6")
inches above the finished floor on the fourth
(4/th/) floor with two (2) pipes finishing six
(6") inches below the finished ceiling on the
third (3/rd/) floor and two (2) pipes finishing
six (6") inches below the finished ceiling on the
second (2/nd/) floor.
3. Four (4") inch sleeves as a form of access via the
"hot columns" that exist in the Demised Premises.
ARTICLE 4
OWNERSHIP OF IMPROVEMENTS
-------------------------
Section 4.01. General Rights of Owner and Tenant: All appurtenances,
----------------------------------
fixtures, improvements, additions and other property attached to or installed in
the Demised Premises, whether by Owner or Tenant or others, and whether at
Owner's expense, or Tenant's expense, or the joint expense of Owner and Tenant,
shall be and remain the property of Owner, except that any such fixtures,
improvements, additions and other property installed at the sole expense of
Tenant with respect to which Tenant has not been granted any credit or allowance
by Owner other than Owner's Work Contribution and Owner's Fifth Year Work
Contribution, and which are removable without material damage to the Demised
Premises shall be and remain the property of Tenant and are referred to as
"Tenant's Personal Property". Any replacements of any property of Owner, whether
---------------------------
made at Tenant's expense or otherwise, shall be and remain the property of
Owner.
ARTICLE 5
REPAIRS
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Section 5.01. Tenant's Repair Obligations: Tenant shall take good
---------------------------
care of the Demised Premises (including, but not limited to, any Class E Fire
Alarm and Communication system and any sprinkler system installed therein and
any installations made or equipment installed therein as a result of any
requirement of New York City Local Law #16 of 1984 or any successor law or like
import) and, at Tenant's sole cost and expense, shall make all repairs and
replacements, structural and otherwise, ordinary and extraordinary, foreseen and
unforeseen as and when needed to preserve the Demised Premises (including, but
not limited to, any Class E Fire Alarm and Communication system and the
sprinkler system installed therein and any installations made or equipment
installed therein as a result of any requirement of New York City Local Law #16
of 1984 or any successor law of like import) in good and safe working order and
in first class repair and condition, except that Tenant shall not be required to
make any repairs or replacements to the Demised Premises unless necessitated or
occasioned by the acts, omissions or negligence of Tenant or any person claiming
through or under Tenant or any of their servants, employees, contractors,
agents, visitors or licensees, or by the manner of use or occupancy of the
Demised Premises (in contradistinction to the mere use of the Demised Premises
for office purposes) by Tenant or any such person. Without affecting Tenant's
obligations set forth in the preceding sentence, Tenant, at Tenant's sole cost
and expense, shall also (i) make all repairs and replacements, and perform all
maintenance as and when necessary, to the lamps, tubes, ballasts, and starters
in the lighting fixtures installed in the Demised Premises, (ii) make all
repairs and replacements, as and when necessary, to Tenant's Personal Property
and to any Alterations made or performed by or on behalf of Tenant or any person
claiming through or under
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Tenant, and (iii) if the Demised Premises shall include any space on any ground,
street, mezzanine or basement floor in the Building, make all replacements, as
and when necessary, to all windows and plate and other glass in, on or about
such space, and obtain and maintain, throughout the Demised Term, plate glass
insurance policies issued by companies, and in form and amounts, satisfactory to
Owner, in which Owner, its agents and any lessor under any ground or underlying
lease shall be named as parties insured, and (iv) perform all maintenance and
make all repairs and replacements, as and when necessary, to any air
conditioning equipment, private elevators, escalators, conveyors or mechanical
systems (other than the Building's standard equipment and systems) which may be
installed in the Demised Premises by Owner, Tenant or others. However, the
provisions of the foregoing sentence shall not be deemed to give to Tenant any
right to install air conditioning equipment, elevators, escalators, conveyors or
mechanical systems. All repairs and replacements made by or on behalf of Tenant
or any person claiming through or under Tenant shall be made and performed in
conformity with, and subject to the provisions of Article 3 and shall be at
least equal in quality and class to the original work or installation. The
necessity for, and adequacy of, repairs and replacements pursuant to this
Article 5 shall be measured by the standard which is appropriate for first class
office buildings of similar construction and class in the Borough of Manhattan,
City of New York.
Section 5.02. Supplementing the provisions of Section 5.0l, Owner, at
Owner's sole cost and expense, shall make (i) all structural repairs to the
Demised Premises as and when required, (ii) all repairs necessary to furnish the
plumbing, electrical, air conditioning, ventilating, heating and elevator
services required to be furnished by Owner to Tenant under the provisions of
Article 29, and (iii) all necessary repairs to the public portions of the
Building which affect Tenant's use and enjoyment of the Demised Premises, except
that Owner shall not be required to make any of the repairs referred to in
subdivision (i), (ii) or (iii) of this sentence if Tenant is obligated to make
such repairs pursuant to the provisions of Section 5.0l. Notwithstanding the
foregoing provisions of this Section, Owner shall have no obligation to make any
repairs unless and until specific notice of the necessity therefor shall have
been given by Tenant to Owner. Within a reasonable time following receipt of
such notice, Owner shall commence such repairs and prosecute the same to
completion with reasonable diligence.
ARTICLE 6
COMPLIANCE WITH LAWS
--------------------
Section 6.01. General Covenants: Tenant, at Tenant's sole cost and
-----------------
expense, shall comply with all Legal Requirements (hereinafter defined) which
shall impose any duty upon Owner or Tenant with respect to the Demised Premises
or the use or occupation thereof, including, but not limited to, the
modification to and maintenance of the sprinkler system serving the Demised
Premises or any part thereof and any requirement that any hazardous material be
removed or dealt with in any particular manner, except that Tenant shall not be
required to make any structural Alterations in order so to comply or remove such
hazardous material existing in the Demised Premises as of the date of this
Lease, unless such Alterations shall be necessitated or occasioned, in whole or
in part, by the acts, omissions, or negligence of Tenant or any person claiming
through or under Tenant, or any of their servants, employees, contractors,
agents, visitors or licensees, or by the manner of use or occupancy of the
Demised Premises (in contradistinction to the mere use of the Demised Premises
for office purposes) by Tenant or by any such person. For all purposes of this
Lease the term "Legal Requirements" shall mean all present and future laws,
------------------
codes, ordinances, statutes, requirements, orders and regulations, ordinary and
extraordinary, foreseen and unforeseen (including, but not limited to, the New
York State Energy Conservation Construction Code, New York City Local Laws #5 of
1973, #16 of 1984 and #58 of 1987 and the Americans with Disabilities Act, and
any successor laws of like import) of any Governmental Authority (hereinafter
defined) and all directions, requirements, orders and notices of violations
thereof. For all purposes of this Lease, the term "Governmental Authority"
----------------------
shall mean the United States of America, the State of New York, the County of
New York, the Borough of Manhattan, the City of New York, any political
subdivision thereof and any agency, department, commission, board, bureau or
instrumentality of any of the foregoing, now existing or hereafter created,
having jurisdiction over Owner, Tenant, this Lease or the Real Property or any
portion thereof. Any work or installations made or performed by or on behalf of
Tenant or any person claiming through or under Tenant pursuant to the provisions
of this Article shall be made in conformity with, and subject to the provisions
of Article 3. For the purposes of this Article, the modification to and
maintenance of the sprinkler system or any requirement that any hazardous
material installed by Tenant be removed or dealt with in any particular manner
or any
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Alterations required to comply with Local Law #5 of 1973, #16 of 1984, #58 of
1987 and the Americans With Disabilities Act and any successor laws of like
import shall be deemed to be a non-structural Alteration. Any modification to
the sprinkler system shall be made in conformity with the provisions of Section
3.05. Compliance with any requirement regarding any hazardous material shall be
made in conformity with the provisions of Section 3.06.
Section 6.02. Tenant's Compliance with Owner's Fire Insurance:
-----------------------------------------------
Tenant shall not do anything, or permit anything to be done, in or about the
Demised Premises which shall (i) invalidate or be in conflict with the
provisions of any fire and/or other insurance policies covering the Building or
any property located therein, or (ii) result in a refusal by fire insurance
companies of good standing to insure the Building or any such property in
amounts reasonably satisfactory to Owner, or (iii) subject Owner to any
liability or responsibility for injury to any person or property by reason of
any business operation being conducted in the Demised Premises, or (iv) cause
any increase in the fire insurance rates applicable to the Building or property
located therein at the beginning of the Demised Term or at any time thereafter.
Tenant, at Tenant's expense, shall comply with all present and future rules,
orders, regulations and/or requirements of the New York Board of Fire
Underwriters and the New York Fire Insurance Rating Organization or any similar
body and the issuer of any insurance obtained by Owner covering the Building
and/or the Real Property, whether ordinary or extraordinary, foreseen or
unforeseen, including, but not limited to, any requirement that any hazardous
material installed by Tenant be removed or dealt with in any particular manner
and any requirement of New York City Local Law #5 of 1973, #16 of 1984, #58 of
1987 and the Americans With Disabilities Act or any successor laws of like
import.
Section 6.03. Fire Insurance Rates: In any action or proceeding
--------------------
wherein Owner and Tenant are parties, a schedule or "make up" of rates
applicable to the Building or property located therein issued by the New York
Fire Insurance Rating Organization, or other similar body fixing such fire
insurance rates, shall be conclusive evidence of the facts therein stated and of
the several items and charges in the fire insurance rates then applicable to the
Building or property located therein.
Section 6.04. Owner agrees that as of the Commencement Date, or the
Additional Space Commencement Date, as the case may be, the core bathrooms on
each floor of the Demised Premises (other than the Basement Space) shall comply
with the Americans With Disabilities Act.
Section 6.05. Tenant shall have the right, after prior written notice
to Owner, and the holder of any mortgage which may now or hereafter affect such
leases and/or the Real Property or the Building, to contest, by appropriate,
administrative and/or legal proceedings, diligently conducted in good faith, at
Tenant's own cost and expense, the validity or application of any law, order,
regulation or direction with which Tenant is required to comply under the
provisions of said Article provided that:
(1) Such contest shall not subject Owner or any lessor
under any such ground or underlying lease or the holder of any such mortgage to
any criminal penalty or impose upon Owner or any such lessor or holder any
unusual obligation or liability or affect any service required to be furnished
by Owner to any other tenant or occupant of the Building; and
(2) Neither such contest nor Tenant's failure to
comply pending such contest shall constitute a default under any ground or
underlying lease, under any mortgage affecting any ground or underlying lease,
or under any mortgage affecting the Building or the Real Property; and
(3) Tenant shall indemnify and protect Owner, all of
the lessors under and all of the holders under any such mortgages affecting any
ground or underlying lease or the Building or the Real Property from and against
any and all damage, expenses, losses, injuries, fees, including, but not limited
to, reasonable counsel fees, penalties, actions, causes of action, suits, costs,
claims or judgments arising from such contest or Tenant's non-compliance with
any such law, order, regulation or direction; and
(4) Promptly following the determination of any such
contest, Tenant shall fully comply with said law, order, regulation or direction
except to the extent, if any, to which it has been determined in said
administrative and/or legal proceedings that Tenant is excused from such
compliance.
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<PAGE>
Section 6.06. Owner agrees solely to the extent that non-compliance
by Owner prevents or hinders Tenant from using the Demised Premises for its
normal business operations or delays Tenant's ability to perform any Alterations
in accordance with the provisions of this Lease, except to a de minimus extent,
Owner, at Owner's sole cost and expense, shall comply with all Legal
Requirements, which shall impose any duty upon Owner or Tenant with respect to
the Demised Premises or the use or occupation thereof, or any other portion of
the Building with which Tenant is not required to comply pursuant to the
provisions of Section 6.01 or 6.02 including, but not limited to, the core
elevators; provided, however, Owner shall not be required to so comply unless
and until Owner shall have received notice of the necessity therefor from Tenant
except that Owner shall be liable for any damages Tenant has suffered arising
from such non-compliance prior to Owner's receipt of such notice. All work
required under this Section 6.06 shall be done in such manner as to minimize
interference with Tenant's normal business operations; provided, however,
nothing contained in this sentence shall be deemed to impose upon Owner any
obligation to employ contractors or labor at so-called overtime or other premium
pay rates; provided further, that in cases where there is a material
interference with Tenant's business, or the health or safety of the occupants of
the Demised Premises is adversely affected, Owner agrees to employ, at Owner's
expense, contractors or labor at overtime or other premium pay rates in order to
effect compliance with any of the foregoing with which Owner is required to
comply pursuant to the provisions of this Section 6.06.
Section 6.07. Owner shall have the right to contest, by appropriate
legal proceedings diligently conducted in good faith, at its own cost and
expense, the validity or application of any law, order, regulation or direction
with which Owner is required to comply under the provisions of Section 6.06
provided that such contest shall not subject Tenant to any penalty or place
Tenant in imminent danger of being required to vacate the Demised Premises or
cease its normal business operations therein or prevent Tenant from making
Alterations pursuant to this Lease or diminish Tenant's rights under this Lease,
except to a de minimus extent.
-- -------
Section 6.08. A. If any laws, orders, rules or regulations of any
Federal, State, County or Municipal authority require that any asbestos or other
hazardous material contained in or about the Demised Premises be removed or
dealt with in any particular manner, then it shall be Owner's obligation, at
Owner's expense, to remove such asbestos and hazardous materials from all
portions of the Demised Premises to be occupied by Tenant in accordance with
such laws, orders, rules and regulations.
B. Notwithstanding the provisions of subsection A of
this Section, in the event any work performed by Owner pursuant to the
provisions of subsection A is in any way disturbed or damaged by Tenant or any
person claiming through or under Tenant, or asbestos or other hazardous material
is installed in the Demised Premises by or on behalf of Tenant, or any person
claiming through or under Tenant, Owner shall have no responsibility in
connection, therewith and no obligation to perform any work with respect
thereto, but it shall be Tenant's obligation, at Tenant's expense, to (i) remove
or so deal with such asbestos or other hazardous material in accordance with all
Legal Requirements. Any work required to be performed by Tenant pursuant to the
provisions of the foregoing sentence is referred to as the "Compliance Work".
In the event Tenant is required to perform any Compliance Work then,
notwithstanding anything to the contrary contained in this subsection B, Owner,
at Owner's election, shall have the option to itself perform any Compliance Work
and, in such event, Tenant shall pay to Owner all of Owner's reasonable out-of-
pocket costs in connection therewith within ten (10) days next following the
rendition of a statement thereof by Owner to Tenant.
C. In the event that all or any portion of the
Demised Premises is rendered untenantable for a period of more than ten (10)
consecutive days as a result of Owner's work under Section 6.08.A. above, the
Fixed Rent and any increases therein allocable to such portion of the Demised
Premises shall be abated for the period from the end of such ten (10) day period
to and including the day immediately preceding the date upon which Tenant is
able to use such portion of the Demised Premises.
18
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ARTICLE 7
SUBORDINATION, ATTORNMENT, ETC.
-------------------------------
Section 7.01. Lease Subordination: This Lease and all the terms,
-------------------
covenants and provisions thereof and all rights, remedies and options of Tenant
under this Lease as the same may hereafter be modified, amended or extended are
and shall remain subject and subordinate in all respects to the mortgages which
will affect the Real Property and the lien thereof on the date of execution and
delivery of this lease which will be held by The Prudential Insurance Company of
America and any additional mortgages hereafter held by such holder and to all
advances made or hereafter to be made under such mortgages, and to all renewals,
modifications, consolidations, correlations, replacements and extensions of, and
substitutions for, such mortgages. Owner shall obtain and deliver to Tenant
simultaneously with the execution and delivery of this Lease an agreement from
the then holder or holders of said mortgages substantially to the effect that in
the event of any foreclosure of said mortgages (including any such additional
mortgages hereafter held by such holder or holders), such holder or holders will
not make Tenant a party-defendant to such foreclosure (unless required by law in
order to obtain jurisdiction, but in such event, no judgment foreclosing this
Lease will be sought) nor disturb its possession under this Lease so long as
there shall be no default by Tenant under this Lease beyond applicable grace
periods (any such agreement, or any agreement of similar import is referred to
in this Lease as a "Non-Disturbance Agreement"). If Owner shall fail to make
timely delivery to Tenant of such Non-Disturbance Agreement executed by the then
holder or holders of such presently existing mortgages, Tenant, as Tenant's sole
remedy for such failure, shall have the right, exercisable within thirty (30)
days after the date of the execution and unconditional delivery of this Lease,
to cancel and terminate this Lease by notice to Owner. Upon the giving of such
notice of cancellation and termination, this Lease shall terminate and come to
an end, and neither party shall have any further rights or liabilities under
this Lease. It is agreed that time is of the essence with respect to any such
notice of cancellation and termination, and that Tenant shall not have the right
to give any such notice after the thirty (30) day period referred to in the
immediately preceding sentence, and that any such notice given after the
expiration of such period shall have no force or effect.
Section 7.02. This Lease and all rights of Tenant under this Lease
shall be and remain subject and subordinate in all respects to all future ground
or underlying leases of the Real Property or the Building and to all renewals,
modifications, replacements and extensions of, and substitutions for, such
ground or underlying leases, provided that (i) any such ground or underlying
lease shall contain provisions, or (ii) the lessor under any such ground or
underlying lease shall execute and deliver to Tenant an agreement, in either
case substantially to the effect that, in the event of the termination of such
ground or underlying lease by reason of the default or insolvency of the lessee
thereunder, such lessor will permit Tenant to attorn to such lessor and will not
disturb its possession under this Lease, so long as there shall be no default by
Tenant under this Lease beyond applicable grace periods (any such provisions or
agreement, or any provisions or agreement of similar import, are referred to in
this Lease as "Tenant Recognition Provisions or a "Tenant Recognition
Agreement").
Section 7.03. This Lease and all the terms, covenants and provisions
thereof and all rights, remedies and options of Tenant under this Lease as the
same may hereafter be modified, amended or extended shall be and remain subject
and subordinate in all respects to all mortgages other than the mortgages
referred to in Section 7.01 which may, from time to time, hereafter affect the
Real Property and/or any future ground or underlying leases and to all advances
to be made under such mortgages, and to all renewals, modifications,
consolidations, correlations, replacements and extensions of, and substitutions
for, any such mortgage or mortgages, provided that (i) the holder of any such
mortgage shall execute and deliver a Non-Disturbance Agreement to Tenant, or
(ii) any such mortgage shall contain provisions substantially to the same effect
as those contained in a Non-Disturbance Agreement (any such provisions are
referred to in this Lease as "Non-Disturbance Provisions").
Section 7.04. If, at any time prior to the expiration of the Demised
Term, any ground or underlying lease under which Owner shall then be the lessee
shall terminate or be terminated for any reason or the holder of any mortgage
acquires possession of the Real Property or the Building or the estate created
by any ground or underlying lease, by receiver or otherwise, Tenant agrees, at
the election and upon demand of any owner of the Real Property or the Building
or of any such receiver, or of the holder of any mortgage in possession of the
Real Property or the Building, or of any lessee under any other ground or
underlying lease covering premises which include the
19
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Demised Premises, to attorn, from time to time, to any such owner, holder,
receiver or lessee, including, but not limited to, the holder of any mortgages
referred to in Section 7.01 or 7.03 or its designee, upon the then executory
terms and conditions of this Lease, for the remainder of the term originally
demised in this Lease, provided that such owner, holder, receiver or lessee,
including, but not limited to, the holder of any mortgages referred to in
Section 7.01 or 7.03 or its designee, as the case may be, shall then be entitled
to receive the rent from the Demised Premises or possession of the Demised
Premises. The foregoing provisions of this Section shall enure to the benefit of
any such owner, holder, receiver or lessee, shall apply notwithstanding that, as
a matter of law, this Lease may terminate upon the termination of any such
ground or underlying lease, shall be self-operative upon any such demand, and no
further instrument shall be required to give effect to said provisions. Tenant,
however, upon demand of any such owner, holder, receiver or lessee, including,
but not limited to, the holder of any mortgages referred to in Section 7.01 or
7.03 or its designee, agrees to execute, from time to time, instruments, in
confirmation of the foregoing provisions of this Section, satisfactory to any
such owner, holder, receiver or lessee, including, but not limited to, the
holder of any mortgages referred to in Section 7.01 or 7.03 or its designee,
acknowledging such adornment and setting forth the terms and conditions of its
tenancy. Nothing contained in this Section shall be construed to impair any
right otherwise exercisable by any such owner, holder, receiver or lessee.
Section 7.05. The subordination provisions of this Article 7 shall be
self-operative and no further instrument of subordination shall be required. In
confirmation of such subordination, however, Tenant shall execute and deliver
promptly any certificate or other instrument evidencing such subordination which
Owner, or any lessor under any ground or underlying lease, or any holder of any
mortgage to which this Lease is subordinate, may reasonably request. If, in
connection with obtaining financing for the Building, the Real Property, or the
interest of the lessee under any ground or underlying lease, any recognized
lending institution shall request reasonable modifications of this Lease as a
condition of such financing, Tenant covenants not unreasonably to withhold or
delay its agreement to such modifications, provided such modifications do not
increase the obligations, or materially and adversely affect the rights, of
Tenant under this Lease. Tenant hereby agrees that in the event of any act or
omission by Owner which would give Tenant the right, either immediately or after
the lapse of a period of time, to terminate this Lease or to claim a partial or
total eviction, Tenant will not exercise any such right until: (i) Tenant shall
have given written notice of Owner's act or omission to the holder or holders of
any mortgage or to the lessor or lessors under any ground or underlying lease of
whom Tenant has been given written notice specifying the act or omission on the
part of Owner which could or would give basis to Tenant's rights; and (ii) the
holder or holders of such mortgage or the lessor or lessors under any such
ground or underlying lease, after receipt of such notice, have failed or refused
to remedy such act or omission, or cause the same to be remedied within a
reasonable time after the giving of such notice by Tenant to such holder or
holders or lessor or lessors provided that such reasonable period of time shall
not exceed sixty (60) days (except if the act or omission is of such a nature
that it cannot be completely remedied within such period of sixty (60) days, it
may be further extended for a further reasonable period of time provided such
holder(s) or lessor(s) shall commence within said period of sixty (60) days and
thereafter diligently prosecute to completion all steps necessary to remedy such
act or omission), except that if: (a) such holder(s) or lessor(s) need(s)
possession of the Real Property in order to effect such remedy, or (b) the act
or omission is personal to Owner and not capable of being remedied by such
holder(s) or lessor(s), then the time for such remedy will be extended until
such holder(s) or lessor(s), using reasonable efforts, shall have foreclosed on
the mortgages (or otherwise taken title to the Real Property) provided such
holder(s) or lessor(s) within sixty (60) days after receipt of Tenant's notice
shall take all steps necessary to commence applicable proceedings to obtain
possession of the Real Property whether through foreclosure proceedings or
otherwise and to prosecute such proceedings with diligence. However, such
holder(s) or lessor(s) shall have no obligation to cure such act or omission by
Owner and shall have no liability for not curing such act or omission by Owner
unless such holder(s) or lessor(s) undertake(s) in writing to do so.
Section 7.06. In the event that by reason of any default on the part
of the Owner, such holder(s) or lessor(s) shall succeed to the interest of Owner
or any successor to Owner, under this Lease then subject to the provisions of
this Article and at the election of the holder(s) or lessor(s), this Lease shall
nevertheless continue in full force and effect, and Tenant shall and does hereby
agree to (1) attorn to such holder(s) or lessor(s) and to recognize such
holder(s) or lessor(s) as the Owner, and upon request of such holder(s) or
lessor(s), Tenant shall execute and deliver to such holder(s) or lessor(s) an
agreement of attornment, or, at such holder(s) or lessor(s) option, (2) enter
into a new lease with such holder(s) or lessor(s), as Owner, for the remaining
term of this Lease and otherwise on the identical terms and conditions and with
the same options, if any, then remaining, including all modifications set forth
20
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in this Article. Notwithstanding anything contained in this Article, or in any
Non-Disturbance Provision, Non-Disturbance Agreement, Tenant Recognition
Provision or Tenant Recognition Agreement, however, the provisions of the
mortgages or ground or underlying leases, as the case may be, shall govern with
respect to the proceeds of any award in condemnation or of any fire or casualty
insurance policies affecting the Real Property and such holder(s) or lessor(s)
as Tenant's landlord, or otherwise, shall not have any liability to Tenant (i)
in the event of damage or destruction to the Building or the premises demised in
this Lease, for any repairs, replacements, rebuilding or restoration, unless
required to be made under the provisions of this Lease and in any event, except
as can reasonably be accomplished from the net proceeds of insurance actually
received by, or made available to such holder(s) or lessor(s) and not applied in
reduction and/or repayment of the loan secured by any such mortgages, or (ii)
for any default by Owner, its successors and assigns under this Lease occurring
prior to any date upon which such holder(s) or lessor(s), its successors and
assigns, shall become Tenant's landlord (provided however such holder(s) or
lessor(s) shall be liable to Tenant for any defaults of its obligations under
this Lease from and after the date such holder(s) or lessor(s) become Tenant's
landlord), or (iii) for or be subject to any credits, offsets, abatements, or
claims against the rent under this Lease accruing to Tenant as a result of any
acts or omissions of Owner, its successors or assigns, occurring or committed
prior to the date upon which such holder(s) or lessor(s) shall become the owner
of or obtain possession or control of the Real Property, or (iv) for any default
by Owner of its obligations under this Lease or any act or omission of Owner,
its successors or assigns, occurring or committed prior to the date upon which
such holder(s) or lessor(s) shall become the owner of or obtain possession or
control of the Real Property or (provided however such holder(s) or lessor(s)
shall be liable to Tenant for any default of its obligation under this lease
from and after the date upon which such holder(s) or lessor(s) shall become the
owner of or obtain possession or control of the Real Property or (v) under any
indemnity provision of whatever nature contained in this Lease, including, but
not limited to, any environmental identification with respect to any act by any
person other than such holder(s) or lessor(s) or any event occurring prior to
the date such holder(s) or lessor(s) shall become Tenant's landlord.
Section 7.07. If required by the holder of any mortgage or by the
lessor under any ground or underlying lease, Tenant shall promptly join in any
Non-Disturbance Agreement or Tenant Recognition Agreement to indicate its
concurrence with the provisions thereof, provided such agreement shall
substantially comply with the provisions of this Article.
Section 7.08. If any such holder(s) or lessor(s) shall succeed to the
interest of Owner, or any successor to Owner, any such holder(s) or lessor(s)
shall have no liability under this Lease prior to the date any such holder(s) or
lessor(s) shall take possession of the Real Property or succeed to the rights of
Owner under this Lease, no liability under this Lease for offsets or defenses
which Tenant might have had against Owner, and in any event any such holder(s)
or lessor(s) shall have no personal liability as successor to Owner and Tenant
shall look only to the estate and property of any such holder(s) or lessor(s) in
the Real Property for the satisfaction of Tenant's remedies for the collection
of a money judgment (or other judicial process) requiring the payment of money
in the event of any default by any such holder(s) or lessor(s), as Owner under
the Lease, and no other property or assets of any such holder(s) or lessor(s)
shall be subject to levy, execution or other enforcement procedure for the
satisfaction of Tenant's remedies under or with respect to this Lease, the
relationship of Owner and Tenant thereunder or Tenant's use or occupancy of the
Demised Premises.
Section 7.09. Tenant agrees that no prepayment of rent or additional
rent due under this Lease of more than one month in advance, and no amendment,
modification, surrender or cancellation of this Lease (other than a
confirmation, ratification or exercise of an express right or benefit set forth
in this Lease), shall be binding upon or as against any such holder(s) or
lessor(s), as holder(s) of the mortgages or lessor(s) of the Real Property of
which Tenant has knowledge, and as Owner under this Lease if it succeeds to that
position, unless consented to in writing by any such holder(s) or lessor(s) or
made pursuant to the exercise of an express right or benefit set forth in this
Lease.
Section 7.10. Any such holder(s) or lessor(s) shall not be obligated
to undertake or complete any specific renovations or additions to the Demised
Premises specifically provided for in this Lease to be performed by Owner (other
than repairs) or pay the cost of any construction or other special landlord work
or pay the cost of any special tenant work which Tenant shall be permitted or
required to perform or reimburse Tenant therefor (in each case either now or
concurrently under way or hereafter to be undertaken, whether or not the same is
set forth in this Lease or any other agreement).
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Section 7.11. A. After request by Owner, Tenant shall, within ten
(10) days furnish Owner with a statement duly acknowledged and certified setting
forth the following to the extent then true and applicable: (i) Tenant is the
owner and holder of the Tenant's interest under this Lease; (ii) this Lease has
not been modified or amended, except as specifically recited; (iii) this Lease
is in full force and effect and the term thereof has commenced; (iv) the
premises demised under this Lease have been completed and Tenant has taken
possession of the same on a rent-paying basis; (v) to the knowledge of Tenant,
neither Tenant nor Owner is in default under any of the terms, covenants or
provisions of the Lease; (vi) neither Tenant nor Owner has commenced any action
or given or received any notice for the purpose of terminating this Lease; (vii)
all rents, additional rents and other sums due and payable under this Lease have
been paid in full for the date due and no rents, additional rents or other sums
payable under this Lease have been paid for more than one (1) month in advance
of the due date thereof; and (viii) there are no offsets or defenses to the
payment of the rents, additional rents, or other sums payable under this Lease.
Tenant acknowledges that any statement delivered pursuant to this said Section
7.11 A may be relied upon by any purchaser or owner of the Building or the Real
Property, or of Owner's interest in the Building or the Real Property or any
ground or underlying lease, or by any mortgagee, or by any assignee of any
mortgage, or by any lessee under any ground or underlying lease.
B. From time to time, within ten (10) days next
following Tenant's request, Owner shall deliver to Tenant a written statement
executed by Owner, in form reasonably satisfactory to Tenant, (i) acknowledging
whether or not this Lease is then in full force and effect and has been modified
(or, if modified, setting forth the specific nature of all modifications), and
(ii) setting forth the date to which the Fixed Rent has been paid, and (iii)
stating whether or not, to the best knowledge of Owner, Tenant is in default
under this Lease, and if Tenant is in default, setting forth the specific nature
of all such defaults. Owner acknowledges that any statement delivered pursuant
to this Section may be relied upon by any prospective assignee of Tenant's
interest in this Lease or by any prospective subtenant.
Section 7.12. If Owner assigns its interest in this Lease, or the
rents payable hereunder, to the holder of any mortgage or the lessor under any
ground or underlying lease, whether the assignment shall be conditional in
nature or otherwise, Tenant agrees that (a) the execution thereof by Owner and
the acceptance by such holder or lessor shall not be deemed an assumption by
such holder or lessor of any of the obligations of the Owner under this Lease
unless such holder or lessor shall, by written notice sent to Tenant,
specifically otherwise elect; and (b) except as aforesaid, such holder or lessor
shall be treated as having assumed Owner's obligations hereunder only upon the
foreclosure of such holder's mortgage or the termination of such lessor's lease
and the taking of possession of the Demised Premises by such holder or lessor,
as the case may be.
Section 7.13. Tenant agrees to cooperate reasonably with Owner in
Owner's obtaining any Non-Disturbance Agreement or Tenant Recognition Agreement
and Tenant shall provide Owner and the holder of any mortgage and the lessor
under any ground or underlying lease with any information reasonably required by
them in connection with obtaining any such Non-Disturbance Agreement or Tenant
Recognition Agreement.
Section 7.14. Owner represents to Tenant that as of the date of this
Lease (i) there are no mortgages affecting the Real Property other than the
mortgage held by The Prudential Insurance Company of America and (ii) there are
no ground or underlying leases affecting the Real Property (other than space
leases with various tenants of the Building).
ARTICLE 8
PROPERTY LOSS, ETC.
-------------------
Section 8.01. Any Building employee to whom any property shall be
entrusted by or on behalf of Tenant shall be deemed to be acting as Tenant's
agent with respect to such property and neither Owner nor Owner's agents shall
be liable for any loss of or damage to any such property by theft or otherwise.
Neither (i) the performance by Owner, Tenant or others of any decorations,
repairs, alterations, additions or improvements in or to the Building or the
Demised Premises, nor (ii) the failure of Owner or others to make any such
decorations, repairs, alterations, additions or improvements, nor (iii) any
damage to the Demised Premises or to the property of Tenant, nor any injury
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to any persons, caused by other tenants or persons in the Building, or by
operations in the construction of any private, public or quasi-public work, or
by any other cause, nor (iv) any latent defect in the Building or in the Demised
Premises, nor (v) any temporary closing, darkening or bricking up of any windows
of the Demised Premises for any reason whatsoever including, but not limited to,
Owner's own acts nor any permanent darkening or bricking up of any such windows
if required by Legal Requirement not occasioned solely by acts or omissions of
Owner, nor (vi) any inconvenience or annoyance to Tenant or injury to or
interruption of Tenant's business by reason of any of the events or occurrences
referred to in the foregoing subdivisions (i) through (v), shall constitute an
actual or constructive eviction, in whole or in part, or entitle Tenant to any
abatement or diminution of rent, or relieve Tenant from any of its obligations
under this Lease, or impose any liability upon Owner, or its agents, or any
lessor under any Superior Lease, other than such liability as may be imposed
upon Owner by law for Owner's negligence or the negligence of Owner's agents,
servants or employees in the operation or maintenance of the Building or for the
breach by Owner of any express covenant of this Lease on Owner's part to be
performed. Tenant's taking possession of the Demised Premises shall be
conclusive evidence, as against Tenant, that, at the time such possession was so
taken, the Demised Premises were in good and satisfactory condition and Owner's
Initial Work was substantially completed.
Section 8.02. Notwithstanding the foregoing provisions of Section
8.01, in the event any windows of the Demised Premises are temporarily closed,
darkened or boarded up due to Owner's own acts (and not as the result of a Legal
Requirement) Owner covenants to reasonably promptly take such steps as are
reasonably necessary to remove such obstruction unless such obstruction is due
to construction or renovation work undertaken by or on behalf of Owner in which
event Owner agrees to remove such temporary obstruction reasonably promptly upon
completion of such work in accordance with applicable Legal Requirements.
ARTICLE 9
DESTRUCTION-FIRE OR OTHER CASUALTY
----------------------------------
Section 9.01. Owner's Repair Obligations: If the Demised Premises
--------------------------
shall be damaged by fire or other casualty and if Tenant shall give prompt
notice to Owner of such damage, Owner, at Owner's expense, shall repair such
damage. However, Owner shall have no obligation to repair any damage to, or to
replace, Tenant's Personal Property or any other property or effects of Tenant.
Except as otherwise provided in Section 9.03, if the entire Demised Premises
shall be rendered untenantable by reason of any such damage, the Fixed Rent
shall abate for the period from the date of such damage to the date when such
damage shall have been repaired, and if only a part of the Demised Premises
shall be so rendered untenantable, the Fixed Rent shall abate equitably for such
period on the basis of the area of the part of the Demised Premises so rendered
untenantable and the allocations of Fixed Rent as set forth in subsection D of
Section 38.02. However, if, prior to the date when all of such damage shall
have been repaired, any part of the Demised Premises so damaged shall be
rendered tenantable and shall be used or occupied by Tenant or any person or
persons claiming through or under Tenant, then the amount by which the Fixed
Rent shall abate shall be equitably apportioned for the period from the date of
any such use or occupancy to the date when all such damage shall have been
repaired. Tenant hereby expressly waives the provisions of Section 227 of the
New York Real Property Law, and of any successor law of like import then in
force, and Tenant agrees that the provisions of this Article shall govern and
control in lieu thereof. Notwithstanding the foregoing provisions of this
Section, if, prior to or during the Demised Term, (i) the Demised Premises shall
be to totally damaged or rendered wholly untenantable by fire or other casualty,
and there shall be less than three (3) years remaining of the Demised Term, as
it may be extended pursuant to the provisions of Article 42 (provided, however,
if any option pursuant to Article 42 has not been exercised prior to such fire
or other casualty because such fire or other casualty has occurred prior to the
time by which Tenant must notify Owner of its exercise of such option, Tenant
shall have the right to exercise such option by notice to Owner within the
lesser of (a) the period of forty-five (45) days following Tenant's receipt of
Owner's notice of termination hereunder and (b) the period between the date of
such fire of other casualty and the date by which Tenant must otherwise notify
Owner of the exercise of such option and in the event Tenant exercises its
option in accordance with the foregoing, Owner's notice of termination shall be
void and of no force and effect) and if Owner shall decide not to restore the
Demised Premises, or (ii) the Building shall be so damaged by fire or other
casualty that, in Owner's opinion, substantial alteration, demolition, or
reconstruction of the Building shall be required (whether or not the Demised
Premises shall have been damaged or rendered untenantable), then, in any of such
events, Owner, at Owner's
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option, may give to Tenant, within ninety (90) days after such fire or other
casualty, a five (5) days' notice of termination of this Lease and, in the event
such notice is given, this Lease shall come to an end and expire (whether or not
said term shall have commenced) upon the expiration of said five (5) days with
the same effect as if the date of expiration of said five (5) days were the
Expiration Date, the Fixed rent shall be apportioned as of such date (subject to
any earlier date or abatement of Fixed Rent) and any prepaid portion of Fixed
Rent for any period after such date shall be refunded by Owner to Tenant.
Section 9.02. Owner's Subrogation Waiver Provisions: Owner shall
-------------------------------------
attempt to obtain and maintain, throughout the Demised Term, in Owner's fire
insurance policies covering the Building, provisions to the effect that such
policies shall not be invalidated should the insured waive, in writing, prior to
a loss, any or all right of recovery against any party for loss occurring to the
Building. In the event that at any time Owner's fire insurance carriers shall
exact an additional premium for the inclusion of such or similar provisions,
Owner shall give Tenant notice thereof. In such event, if Tenant agrees, in
writing, to reimburse Owner for such additional premium for the remainder of the
Demised Term, Owner shall require the inclusion of such or similar provisions by
Owner's fire insurance carriers. As long as such or similar provisions are
included in Owner's fire insurance policies then in force, Owner hereby waives
(i) any obligation on the part of Tenant to make repairs to the Demised Premises
necessitated or occasioned by fire or other casualty that is an insured risk
under such policies, and (ii) any right of recovery against Tenant, any other
permitted occupant of the Demised Premises, and any of their servants,
employees, agents or contractors, for any loss occasioned by fire or other
casualty which is an insured risk under such policies. In the event that at any
time Owner's fire insurance carriers shall not include such or similar
provisions in Owner's fire insurance policies, the waivers set forth in the
foregoing sentence shall, upon notice given by Owner to Tenant, be deemed of no
further force or effect.
Section 9.03. Tenant Negligence: Except to the extent expressly
-----------------
provided in Section 9.02, nothing contained in this Lease shall relieve Tenant
of any liability to Owner or to its insurance carriers which Tenant may have
under law or the provisions of this Lease in connection with any damage to the
Demised Premises or the Building caused by fire or other casualty.
Notwithstanding the provisions of Section 9.01, if any such damage, occurring
after any date when the waivers set forth in Section 9.02 are no longer in force
and effect, is due to the fault or neglect of Tenant, any person claiming
through or under Tenant, or any of their servants, employees, agents,
contractors, visitors or licensees, then there shall be no abatement of Fixed
Rent by reason of such damage.
Section 9.04. Tenant Subrogation Waiver Provisions: Tenant
------------------------------------
acknowledges that it has been advised that Owner's insurance policies do not
cover Tenant's Personal Property or any other property of Tenant in the Demised
Premises; accordingly, it shall be Tenant's obligation to obtain and maintain
insurance covering its property in the Demised Premises and loss of profits
including, but not limited to, water damage coverage and business interruption
insurance. Tenant shall attempt to obtain and maintain, throughout the Demised
Term, in Tenant's fire and other insurance policies covering Tenant's Personal
Property and other property of Tenant in the Demised Premises, and Tenant's use
and occupancy of the Demised Premises, and/or Tenant's profits (and shall cause
any other permitted occupants of the Demised Premises to attempt to obtain and
maintain, in similar policies), provisions to the effect that such policies
shall not be invalidated should the insured waive, in writing, prior to a loss,
any or all right of recovery against any party for loss occasioned by fire or
other casualty which is an insured risk under such policies. In the event that
at any time the fire insurance carriers issuing such policies shall exact an
additional premium for the inclusion of such or similar provisions, Tenant shall
give Owner notice thereof. In such event, if Owner agrees, in writing, to
reimburse Tenant or any person claiming through or under Tenant, as the case may
be, for such additional premium for the remainder of the Demised Term, Tenant
shall require the inclusion of such or similar provisions by such insurance
carriers. As long as such or similar provisions are included in such insurance
policies then in force, Tenant hereby waives (and agrees to cause any other
permitted occupants of the Demised Premises to execute and deliver to Owner
written instruments waiving) any right of recovery against Owner, any lessors
under any Superior Leases, the holders of any Mortgage, and all other tenants or
occupants of the Building, and any servants, employees, agents or contractors of
Owner, or of any such lessor, or holder or any such other tenants or occupants,
for any loss occasioned by fire or other casualty which is an insured risk under
such policies. In the event that at any time such insurance carriers shall not
include such or similar provisions in any such insurance policy, the waiver set
forth in the foregoing sentence (or in any written instrument executed by any
other permitted occupant of the Demised Premises) shall, upon notice given by
Tenant to Owner, be deemed of no further force or effect with respect to any
insured risks
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under such policy from and after the giving of such notice. During any period
while any such waiver of right of recovery is in effect, Tenant, or any other
permitted occupant of the Demised Premises, as the case may be, shall look
solely to the proceeds of such policies to compensate Tenant or such other
permitted occupant for any loss occasioned by fire or other casualty which is an
insured risk under such policies.
Section 9.05. For the purposes of this Article 9, (i) the Demised
Premises shall be deemed untenantable if Tenant shall be deprived of reasonable
means of access to the Demised Premises by reason of fire of other casualty, and
(ii) any floor of the Demised Premises shall be deemed untenantable if Tenant
shall be deprived of reasonable access thereto through public parts of the
Building.
Section 9.06. Owner agrees, during the Demised Term, to obtain and
keep in full force and effect insurance against loss or damage by fire or other
casualty to the Building in an amount equal to not less then eighty (80%)
percent of the replacement value of the Building exclusive of footings and
foundations.
Section 9.07. Owner agrees that it shall not exercise its option to
give a notice of termination of this Lease pursuant to the provisions of
subdivision (ii) of Section 9.01 unless Owner exercises a similar option in
leases affecting all space in the Building.
Section 9.08. In the event that fifty (50%) percent or more of the
Demised Premiss shall be rendered wholly untenantable by reason of any damage
occurring during the last two (2) years of the Demised Term, as it may be
extended pursuant to the provisions of Article 42, by fire or other casualty,
Tenant, at Tenant's option, and as Tenant's sole remedy with respect thereto,
may give to Owner within thirty (30) days following such fire or other casualty,
a thirty (30) days' notice of termination of this Lease and, in the event any
such notice is given in accordance with the foregoing provisions of this
sentence, this Lease and the Demised Term shall come to an end and expire upon
the expiration of said thirty (30) days as if the expiration of said thirty (30)
days were the Expiration Date, the Fixed Rent and any increases in the Fixed
Rent pursuant to the provisions of Article 23, shall be apportioned as of such
date, and any prepaid portion of Fixed Rent and any such increases for any
period after such date shall be promptly refunded by Owner and Tenant.
Section 9.09. Owner covenants that if the Demised Premises or the
Building shall be damaged by fire or other casualty, and Owner and Tenant shall
fail to exercise any applicable option to give a notice of termination of this
Lease pursuant to this Article, Owner shall repair such damage with diligence
after final settlement of any insurance claim by Owner in connection with such
damage, provided, however, in the event such final settlement does not occur
within a reasonable time, Owner shall commence repair of such damage prior to
such settlement. Owner shall diligently attempt to settle any such insurance
claim. However, nothing contained in this Subsection shall be deemed to impose
upon Owner any obligation to employ labor at overtime or other premium pay
rates.
Section 9.10. A. Supplementing the provisions of Section 9.01, in
the event (a) the Demised Premises or Building shall be damaged by fire or other
casualty and Tenant shall be unable to use the Demised Premises as a result of
such damage and (b) Owner shall not exercise the right to terminate this Lease
in accordance with the provisions of Section 9.01 and shall, accordingly, be
obligated to repair any such damage, then, if such damage is not repaired within
twelve (12) months after the date of such fire or other casualty (such twelve
(12) month period is referred to as the "Restoration Period"), Tenant shall have
the following options:
(i) to give to Owner within ten (10) days next
following the expiration of the Restoration Period a five (5) days' notice of
termination of this Lease, or
(ii) to extend the Restoration Period for a
further period of six (6) months by notice given to Owner within ten (10) days
after the expiration of the initial Restoration Period. In the event Tenant
shall have given such notice to Owner extending the initial Restoration Period
and if such damage shall not have been repaired by Owner within any extended
Restoration Period, Tenant shall have the options to (a) further extend the
Restoration Period for further successive periods of six (6) months, by notice
given to Owner within ten (10) days
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after the expiration of any extended Restoration Period or (b) to give Owner,
within ten (10) days after the expiration of any such extended Restoration
Period a five (5) days' notice of termination of this Lease.
B. Notwithstanding anything to the contrary contained
in the provisions of Paragraph A of this Section 9.10, in the event Owner, in
Owner's opinion, shall determine that the repair of such damage to the Demised
Premises or Building will reasonably require a period longer than twelve (12)
months, Owner shall, within ninety (90) days after the date of such fire or
casualty, give a notice to Tenant extending the initial Restoration Period to
the date upon which Owner estimates that such repair to the Demised Premises or
Building shall be completed. In the event Owner shall give such a notice under
this Paragraph B, then, the initial Restoration Period set forth in Paragraph A
of this Section 9.10, shall be so extended and (b) Tenant shall have the further
option to give to Owner a five (5) days' notice of termination of this Lease
within twenty (20) days next following the giving of such notice under this
Paragraph B by Owner to Tenant extending the initial Restoration Period.
C. Time is of the essence with respect to the giving
by Tenant to Owner of any notice in accordance with the provisions of Paragraphs
A and B of this Section 9.10 and in the event that Tenant shall fail to give any
such notice within the time periods set forth therein, Tenant shall be deemed to
have given to Owner a notice pursuant to subdivision (ii) of Paragraph A of this
Section 9.10 extending the Restoration Period provided, however, that any five
(5) days' notice of termination given by Tenant pursuant to the provisions of
Paragraph B of this Section 9.10 beyond the ten (10) day period provided therein
shall be void and of no force and effect.
D. In the event that Tenant shall give to Owner
within the applicable time periods set forth in the foregoing provisions of this
Section a five (5) days' notice of termination of this Lease, this Lease and the
Demised Term shall come to an end and expire upon the expiration of said five
(5) days with the same effect as if the date of expiration of said five (5) days
were the Expiration Date, the Fixed Rent and all increases thereof shall be
apportioned as of such date, and any prepaid portion of Fixed Rent for any
period after such date shall be refunded by Owner to Tenant.
E. Nothing contained in the foregoing provisions of
this Section 9.10 shall be deemed to affect the rights of Owner to give to
Tenant a five (5) days' notice of termination of this Lease in accordance with
the provisions of Subdivision (i) of Section 9.01 and the provisions of
Subdivision (ii) of Section 9.01.
ARTICLE 10
EMINENT DOMAIN
--------------
Section 10.01. Taking of the Demised Premises: If the whole of the
------------------------------
Demised Premises shall be acquired for any public or quasi-public use or
purpose, whether by condemnation or by deed in lieu of condemnation, this Lease
and the Demised Term shall end as of the date of the vesting of title with the
same effect as if said date were the Expiration Date. If only a part of the
Demised Premises shall be so acquired or condemned then, except as otherwise
provided in this Section, this Lease and the Demised Term shall continue in
force and effect but, from and after the date of the vesting of title, the Fixed
Rent shall be equitably reduced on the basis of the area of the part of the
Demised Premises as acquired or condemned and the allocations of Fixed Rent set
forth in subsection D of Section 38.02. If only a part of the Real Property
shall be so acquired or condemned, then (i) whether or not the Demised Premises
shall be affected thereby, Owner, at Owner's option, may give to Tenant, within
sixty (60) days next following the date upon which Owner shall have received
notice of vesting of title, a five (5) days' notice of termination of this
Lease, and (ii) if the part of the Real Property so acquired or condemned shall
contain more than ten (10%) percent of the total area of the Demised Premises
immediately prior to such acquisition or condemnation, or if, by reason of such
acquisition or condemnation, Tenant no longer has reasonable means of access to
the Demised Premises, Tenant, at Tenant's option, may give to Owner, within
sixty (60) days next following the date upon which Tenant shall have received
notice of vesting of title, a five (5) days' notice of termination of this
Lease. Notwithstanding anything to the contrary contained in the provisions of
subsection (i) of the immediately preceding
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sentence, Owner agrees that unless the Demised Premiss are so affected to a
material degree by a condemnation or acquisition, Owner will not exercise its
option to give a notice of termination of this Lease pursuant to the provisions
of said subdivision (i) unless Owner exercises a similar option in other leases
affecting substantially all of the space in the Building. In the event any such
five (5) days' notice of termination is given, by Owner or Tenant, this Lease
and the Demised Term shall come to an end and expire upon the expiration of said
five (5) days with the same effect as if the date of expiration of said five (5)
days were the Expiration Date. If a part of the Demised Premises shall be so
acquired or condemned and this Lease and the Demised Term shall not be
terminated pursuant to the foregoing provisions of this Section, Owner, at
Owner's expense, shall restore that part of the Demised Premises not so acquired
or condemned to a self-contained rental unit. In the event of any termination of
this Lease and the Demised Term pursuant to the provisions of this Section, the
Fixed Rent shall be apportioned as of the date of such termination and any
prepaid portion of Fixed Rent for any period after such date shall be refunded
by Owner to Tenant.
Section 10.02. Condemnation Award or Claims: In the event of any such
----------------------------
acquisition or condemnation of all or any part of the Real Property, Owner shall
be entitled to receive the entire award for any such acquisition or
condemnation, Tenant shall have no claim against Owner or the condemning
authority for the value of any unexpired portion of the Demised Term and Tenant
hereby expressly assigns to Owner all of its right in and to any such award.
Nothing contained in this Section shall be deemed to prevent Tenant from making
a claim in any condemnation proceedings for the value of any items of Tenant's
Personal Property which are compensable, in law, as trade fixtures or, provided
that such claim is authorized by law and will not in anyway diminish the award
to which Owner would be entitled if no such claim were made, for Tenant's moving
expenses.
ARTICLE 11
ASSIGNMENT AND SUBLETTING
-------------------------
Section 11.01. General Covenant: Except as expressly provided in this
----------------
Article 11, Tenant, for itself, its heirs, distributees, executors,
administrators, legal representatives, successors and assigns, covenants that,
without the prior consent of Owner in each instance, it shall not (i) assign
whether by merger, consolidation or otherwise, mortgage or encumber its interest
in this Lease, in whole or in part, or (ii) sublet, or permit the subletting of,
the Demised Premises or any part thereof, or (iii) permit the Demised Premises
or any part thereof to be occupied, or used for desk space, mailing privileges
or otherwise, by any person other than Tenant. The sale, pledge, transfer or
other alienation of (a) any of the issued and outstanding capital stock of any
corporate Tenant (unless such stock is publicly traded on a recognized security
exchange or over-the counter market) or (b) any interest in any partnership,
limited liability company or joint venture or other business entity comprising
Tenant, however accomplished, and whether in a single transaction or in a series
of related and/or unrelated transactions, shall be deemed for the purposes of
this Section as an assignment of this Lease which shall require the prior
consent of Owner in each instance.
Section 11.02. Owner's Rights Upon Assignment: If Tenant's interest
------------------------------
in this Lease is assigned, whether or not in violation of the provisions of this
Article, Owner may collect rent from the assignee; if the Demised Premises or
any part thereof are sublet to, or occupied by, or used by, any person other
than Tenant, whether or not in violation of this Article, Owner, after default
by Tenant under this Lease, may collect rent from the subtenant, user or
occupant. In either case, Owner shall apply the net amount collected to the
rents reserved in this Lease, but neither any such assignment, subletting,
occupancy, or use, whether with or without Owner's prior consent, nor any such
collection or application, shall be deemed a waiver of any term, covenant or
condition of this Lease or the acceptance by Owner of such assignee, subtenant,
occupant or user as tenant. The consent by Owner to any assignment, subletting,
occupancy or use shall not relieve Tenant from its obligation to obtain the
express prior consent of Owner to any further assignment, subletting, occupancy
or use. If this Lease is assigned to any person or entity pursuant to any
proceeding of the type referred to in Subsections 16.01(c) and 16.01(d), any and
all monies or other consideration payable or otherwise to be delivered in
connection with such assignment shall be paid or delivered to Owner, shall be
and remain the exclusive property of Owner and shall not constitute property of
Tenant or of the estate of Tenant within the meaning of any proceeding of the
type referred to in Subsections 16.01(c) and 16.01(d). Any and all monies or
other considerations constituting Owner's property under the preceding sentence
not paid or delivered to Owner shall be held in trust for the benefit of Owner
and shall be promptly paid to or turned over to Owner. Any person or entity
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to which this Lease is assigned pursuant to any proceeding of the type referred
to in Subsections 16.01(c) and 16.01(d) shall be deemed without further act or
deed to have assumed all of the obligations arising under this Lease on and
after the date of such assignment. Any such assignee shall execute and deliver
to Owner upon demand an instrument confirming such assumption. The listing of
any name other than that of Tenant on any door of the Demised Premises or on any
directory or in any elevator in the Building, or otherwise, shall not operate to
vest in the person so named any right or interest in this Lease or in the
Demised Premises, or the Building, or be deemed to constitute, or serve as a
substitute for, any prior consent of Owner required under this Article, and it
is understood that any such listing shall constitute a privilege extended by
Owner which shall be revocable at Owner's will by notice to Tenant. Tenant
agrees to pay to Owner reasonable counsel fees incurred by Owner in connection
with any proposed assignment of Tenant's interest in this Lease or any proposed
subletting of the Demised Premises or any part thereof. Neither any assignment
of Tenant's interest in this Lease nor any subletting, occupancy or use of the
Demised Premises or any part thereof by any person other than Tenant, nor any
collection of rent by Owner from any person other than Tenant as provided in
this Section, nor any application of any such rent as provided in this Section
shall, in any circumstances, relieve Tenant of its obligation fully to observe
and perform the terms, covenants and conditions of this Lease on Tenant's part
to be observed or performed.
Section 11.03. A. As long as Tenant is not in default under any of
the terms, covenants or conditions of this Lease on Tenant's part to be observed
or performed beyond applicable grace periods, Tenant shall have the right to
give notice to Owner (referred to as a "Tenant's Section 11.03 Sublet Notice")
of Tenant's intention to sublet all or any part of the Demised Premises (the
space which Tenant intends to sublet is referred to in this Section as the
"Section 11.03 Sublet Space"), which notice shall set forth the proposed
commencement and expiration dates of the term of such intended subletting (and,
if the Section 11.03 Sublet Space, or any portion thereof, shall constitute less
than an entire floor, such notice shall be accompanied by a floor plan
delineating such Section 11.03 Sublet Space or portion thereof).
B. Within a period of one hundred twenty (120) days
after the giving of Tenant's Section 11.03 Sublet Notice, if the Section 11.03
Sublet Space shall contain all or substantially all of the Demised Premises,
Owner, at Owner's option, may give to Tenant, a notice terminating this Lease on
the date (referred to as the "Earlier Termination Date") immediately prior to
the proposed commencement date set forth in Tenant's Section 11.03 Sublet Notice
but in no event shall the Earlier Termination Date occur prior to the expiration
of the one hundred twenty (120) day period set forth above, and, in the event
such notice is given, this Lease and the Demised Term shall come to an end and
expire on the Earlier Termination Date with the same effect as if it were the
Expiration Date, the Fixed Rent shall be apportioned as of the Earlier
Termination Date and any prepaid portion of Fixed Rent for any period after such
date shall be refunded by Owner to Tenant. Within a period of either (1) thirty
(30) days after the giving of Tenant's Section 11.03 Sublet Notice if the
Section 11.03 Sublet Space shall contain less than five thousand (5,000)
rentable square feet or (2) one hundred twenty (120) days after the giving of
Tenant's Section 11.03 Sublet Notice, if the Section 11.03 Sublet Space shall
contain five thousand (5,000) rentable square feet or more, as the case may be,
Owner, at Owner's option, may give to Tenant a notice (referred to as a "Section
11.03 Elimination Notice") electing to eliminate the Section 11.03 Sublet Space
(after the giving of such notice, such Space is referred to as the "Eliminated
Space") from the Demised Premises during the period (referred to as the
"Elimination Period") commencing on the date fixed by Owner in such Section
11.03 Elimination Notice (referred to as the "Elimination Date") which date may
be any date between the date which is one (1) month prior to and the date which
is three (3) months subsequent to the proposed commencement date set forth in
Tenant's Section 11.03 Sublet Notice, both inclusive, which date shall, in any
event, not be earlier than the date next following the expiration of the
applicable thirty (30) day or one hundred twenty (120) day period set forth in
subdivisions (1) and (2) above, and ending on the date fixed by Owner in such
Section 11.03 Elimination Notice, which date may be any date between the date
which is three (3) months prior to and the date which is three (3) months
subsequent to the proposed expiration date set forth in Tenant's Section 11.03
Sublet Notice, both inclusive. In the event any Section 11.03 Elimination Notice
shall be given, the provisions of Section 11.04 shall apply to the Eliminated
Space.
C. If, at the expiration of the applicable thirty
(30) day or one hundred twenty (120) day period set forth in subsection B of
this Section 11.03, (1) Owner shall not have given a notice terminating this
Lease or a Section 11.03 Elimination Notice, and (2) Tenant is not in default
under any of the terms, covenants or conditions of this Lease on Tenant's part
to be observed or performed beyond applicable grace periods, Owner
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agrees thereafter not unreasonably to withhold its prior consent to a subletting
by Tenant of the Section 11.03 Sublet Space provided that any subletting of all
or part of the Basement Space shall include any other part of the Demised
Premises as well. Without Owner's prior consent, Tenant shall not (x) negotiate
or enter into a proposed subletting with any tenant, subtenant or occupant of
any space in the Building (other than any subtenant of Tenant) if at such time
there is comparable vacant space or comparable space available for leasing in
the Building unless such vacant space or space available for leasing contains
substantially fewer rentable square feet than contained in the proposed sublet
space or (xx) list or otherwise publicly advertise the Demised Premises or any
part thereof for subletting at a rental lower than the rental at which Owner is
then offering to rent comparable space in the Building (provided the foregoing
shall not prohibit Tenant from advertising the Demised Premises in so-called
"brokers sheets" with rents furnished upon request). Any such subletting shall
be (a) for substantially the same term set forth in Tenant's Section 11.03
Sublet Notice, (b) for undivided occupancy by the subtenant of that part of the
Demised Premises affected thereby, and (c) for the use permitted in this Lease,
and at no time shall there be more than three (3) occupants, including Tenant,
on any one (1) floor. At least thirty (30) days prior to any such proposed
subletting, Tenant shall submit to Owner a statement (referred to as the
"Proposed Sublet Statement") containing the name and address of the proposed
subtenant, the nature of the proposed subtenant's business and its current
financial status, if such status is obtained or obtainable by Tenant, and all of
the principal terms and conditions of the proposed subletting, including, but
not limited to, the proposed commencement and expiration dates of the term
thereof, and unless the Section 11.03 Sublet Space shall constitute an entire
floor or floors, the Proposed Sublet Statement shall be accompanied by a floor
plan delineating the proposed sublet space. Owner may, however, arbitrarily
withhold such consent if, in Owner's reasonable judgment, the occupancy of the
proposed subtenant will tend to impair the character or dignity of the Building
or impose any additional burden upon Owner in the operation of the Building or
the proposed subtenant shall be a person or entity with whom Owner is then
negotiating or discussing to lease space in the Building. In the event of any
dispute between Owner and Tenant as to the reasonableness of Owner's refusal to
consent to any such proposed subletting, such dispute shall be determined by
arbitration in the City of New York in accordance with the rules and regulations
then obtaining of the American Arbitration Association or its successor as set
forth in Article 36. Any such determination shall be final and binding upon the
parties, whether or not a judgment shall be entered in any court. If the
determination of any such arbitration shall be adverse to Owner, Owner,
nevertheless, shall not be liable to Tenant for a breach of Owner's covenant not
unreasonably to withhold such consent, and Tenant's sole remedy in such event
shall be to enter into the proposed subletting unless (x) the Building shall not
have been a Rudin Building (as hereinafter defined) at the time such consent was
withheld, and (y) such consent shall have been withheld in bad faith in which
event Owner shall pay Tenant's out-of-pocket costs and expenses (including
attorneys' fees). For the purposes of the preceding sentence, the term "Rudin
Building" shall mean a building at least fifty (50%) percent of which is owned
or controlled, either by voting rights, contract or otherwise, by lineal
descendants of Samuel Rudin and/or spouses of such lineal descendants and/or
trusts established for the benefit of any of the foregoing persons.
D. Any sublease consented to by Owner must conform in
all material respects to the information contained in the Proposed Sublet
Statement and shall expressly provide that (a) the subtenant shall obtain
provisions in its insurance policies to the effect that such policies shall not
be invalidated should the insured waive, in writing, prior to a loss, any or all
right of recovery against any party for loss occasioned by fire or other
casualty which is an insured risk under such policies, as set forth in Section
9.04, and (b) in the event of the termination, re-entry or dispossess of Tenant
by Owner under this Lease, Owner may, at its option, take over all of the right,
title and interest of Tenant, as sublessor under the sublease, and such
subtenant shall, at Owner's option, attorn to Owner pursuant to the then
executory provisions of such sublease, except that Owner shall not (i) be liable
for any act or omission of Tenant under such sublease prior to such attornment
by subtenant, (ii) be subject to any offset which accrued to such subtenant
against Tenant, (iii) be bound by any previous modification of such sublease or
by any previous prepayment of more than one month's rent unless such
modification or prepayment was previously approved by Owner, (iv) be bound by
any covenant to undertake or complete any construction of the premises, or any
portion thereof, demised by such sublease and (v) be bound by any obligation to
make any payment to or on behalf of the subtenant, except for services, repairs,
maintenance and restoration provided for under the sublease to be performed
after the date of such termination, re-entry or dispossess by Owner under this
Lease and to which Owner is expressly required to perform under this Lease with
respect to the subleased space at Owner's expense, it being expressly
understood, however, that Owner shall not be bound by any obligation to make
payment to or on behalf of a subtenant with respect to construction performed by
or on behalf of such subtenant in the subleased premises. Tenant shall reimburse
Owner on demand for any costs or expense that may be incurred by Owner's review
of any Proposed
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Sublet Statement or in connection with any sublease consented to by Owner,
including, without limitation, any reasonable attorneys' fees and disbursements
and the reasonable costs of making investigations as to the acceptability of the
proposed subtenant.
E. The covenant of Owner contained in Subsection C of
this Section 11.03 not unreasonably to withhold its consent to a proposed
subletting by Tenant of the Section 11.03 Sublet Space shall apply only for a
period of one hundred eighty (180) days next following the expiration of both
the thirty (30) day period and the one hundred twenty (120) day period set forth
in Subsection B of this Section 11.03 and shall not apply after the expiration
of such one hundred eighty (180) day period subject, however, to Tenant's right
to give to Owner another Tenant's Section 11.03 Sublet Notice pursuant to the
provisions of subsection A of this Section 11.03.
Section 11.04. A. In the event any Section 11.03 Elimination Notice
shall be given by Owner (i) the Eliminated Space shall be eliminated from the
Demised Premises during the Elimination Period; (ii) Tenant shall surrender the
Eliminated Space to Owner on or prior to the Elimination Date in the same manner
as if said Date were the Expiration Date; (iii) if the Eliminated Space shall
constitute less than an entire floor, (a) Owner, at Owner's expense, shall have
the right to make any alterations and installations in the Demised Premises
required, in Owner's judgment, reasonably exercised, to make the Eliminated
Space a self-contained rental unit with access through corridors to the
elevators and core toilets serving the Eliminated Space, and if the Demised
Premises shall contain any core toilets (for the purposes of this Article, core
toilets shall be deemed to include any unisex toilets) or any corridors
(including any corridors proposed to be constructed by Owner pursuant to this
subdivision [iii]), providing access from the Eliminated Space to the core area,
(b) Owner and any tenant or other occupant of the Eliminated Space shall have
the right to use such toilets and corridors in common with Tenant and any other
permitted occupants of the Demised Premises, and the right to install signs and
directional indicators in or about such corridors indicating the name and
location of such tenant or other occupant; (iv) during the Elimination Period,
the Fixed Rent shall be equitably reduced on the basis of the area of the
Eliminated Space and the allocations of Fixed Rent set forth in subsection D of
Section 38.02 and the Demised Premises Area (as defined in Article 23) shall be
reduced in the proportion which the area of the Eliminated Space bears to the
total area of the Demised Premises immediately prior to the Elimination Date
(including an equitable portion of the area of any corridors referred to in
subdivision (iii) of this sentence as part of the area of the Eliminated Space
for the purpose of computing such reduction), and any prepaid portion of Fixed
Rent for any period after the Elimination Date allocable to the Eliminated Space
shall be refunded by Owner to Tenant and in the event that the Eliminated Space
shall be the entire Demised Premises, during the Elimination Period, Tenant
shall have no rights with respect to the Demised Premises nor any obligations
with respect to the Demised Premises, including, but not limited to, any
obligations to pay Fixed Rent or any increases therein or any additional rent,
(v) there shall be an equitable apportionment of any increase in the Fixed Rent
pursuant to Article 23 for the Escalation Year and Tax Escalation Year (as
defined in Article 23) in which said Elimination Date shall occur; (vi) if the
Elimination Period shall end prior to the Expiration Date, the Eliminated Space,
in its then existing condition provided, Owner, at Owner's cost and expense,
shall remove the demising walls within the Eliminated Space and the Eliminated
Space shall be usable as general offices (unless the Eliminated Space was not so
usable on the date immediately preceding the Elimination Date) and if not so
usable shall be made so usable by Owner; however, if it is the subtenant's
obligation under the Proposed Sublease to make such restoration and the
subtenant defaults in such obligation, then Owner shall assign to Tenant,
without recourse, its rights, at Tenant's sole cost and expense, to enforce such
restoration obligation or to seek damages caused by the failure of such
subtenant to so restore the Eliminated Space, shall be deemed restored to and
once again a part of the Demised Premises during the period (referred to as the
"Restoration Period") commencing on the date next following the expiration of
the Elimination Period and ending on the Expiration Date; (vii) during the
Restoration Period, if any, the Fixed Rent shall be equitably increased on the
basis of the area of the Eliminated Space and the allocations of Fixed Rent set
forth in subsection D of Section 38.02 and the Demised Premises Area, shall be
increased in the proportion which the area of the Eliminated Space bears to the
total area of the Demised Premises immediately prior to the commencement of the
Restoration Period (including an equitable portion of the area of any corridors
referred to in subdivision (iii) of this sentence as a part of the area of the
Eliminated Space for the purpose of computing such increase) and in the event
that the Eliminated Space shall be the entire Demised Premises, during the
Restoration Period, the Demised Premises, in its then existing condition
provided, Owner, at Owner's cost and expense, shall remove the demising walls
within the Eliminated Space and the Eliminated Space shall be usable as general
offices (unless the Eliminated Space was not so usable on the date immediately
preceding the Elimination Date) and if not so usable shall be made so usable by
Owner; however, if it is the subtenant's
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obligation under the Proposed Sublease to make such restoration and the
subtenant defaults in such obligation, then Owner shall assign to Tenant,
without recourse, its rights, at Tenant's sole cost and expense, to enforce such
restoration obligation or to seek damages caused by the failure of such
subtenant to so restore the Eliminated Space, shall be deemed restored to Tenant
and Tenant shall have all rights with respect to the Demised Premises which are
set forth in this Lease and all obligations with respect to the Demised Premises
which are set forth in this Lease, including, but not limited to, the
obligations for the payment of Fixed Rent and any increases therein and any
additional rent (as they would have been adjusted if Tenant occupied the Demised
Premises during the Elimination Period); and (viii) there shall be an equitable
apportionment of any increase in the Fixed Rent pursuant to Article 23 for the
Escalation Year and Tax Escalation Year in which the Restoration Period, if any,
shall commence; however, notwithstanding the foregoing, Owner and Tenant
acknowledge the possibility that all or any of the tenants or occupants of the
Eliminated Space may not have vacated and surrendered all or any portions of the
Eliminated Space to Owner by the commencement of the Restoration Period;
accordingly, notwithstanding anything to the contrary contained in the foregoing
provisions of this Section, (1) the Restoration Period applicable to the
Eliminated Space shall commence on the commencement of the Restoration Period
with respect to those portions, if any, of the Eliminated Space which are vacant
on the commencement of the Restoration Period and with respect to those
portions, if any, of the Eliminated Space which are not vacant on the
commencement of the Restoration Period on the respective later date or dates
upon which such portions of the Eliminated Space become vacant and Owner gives
notice to Tenant of such vacancy and the Expiration Date shall not be affected
thereby, the increases in the Fixed Rent and Demised Premises Area, shall be
equitably adjusted to reflect the fact that all or any portions of the
Eliminated Space have not been restored to Tenant on the commencement of the
Restoration Period but are restored to Tenant and included back in the Demised
Premises on a date or dates after the commencement of the Restoration Period and
(2) except as set forth in this sentence, neither the validity of this Lease nor
the obligations of Tenant under this Lease shall be affected thereby and (3)
Tenant waives any right to rescind this Lease and to recover any damages from
Owner which may result from the failure of Owner to deliver possession of all or
any portions of the Eliminated Space on the commencement of the Restoration
Period and Owner shall institute, within thirty (30) days after the commencement
of the Restoration Period, possession proceedings against any tenants and
occupants who have not so vacated and surrendered all or any portions of the
Eliminated Space, and shall prosecute such proceedings with reasonable diligence
or, at Tenant's election, exercisable within such thirty (30) day period, Owner
shall assign to Tenant, without recourse, its rights to institute, at Tenant's
sole cost and expense, possession proceedings against any such tenants and
occupants who have not so vacated and surrendered such portion of the Eliminated
Space and, in such event, Tenant agrees to so institute such proceedings with
reasonable diligence and to prosecute them with reasonable diligence.
Notwithstanding anything to the contrary contained in the foregoing sentence,
Tenant shall not be obligated to take back the Eliminated Space in more than (2)
portions per floor.
B. At the request of Owner, Tenant shall execute and
deliver an instrument or instruments, in form satisfactory to Owner, setting
forth any modifications to this Lease contemplated in or resulting from the
operation of the provisions of this Section and Section 11.03; however, neither
Owner's failure to request any such instrument nor Tenant's failure to execute
or deliver any such instrument shall vitiate the effect of the provisions of
this Section and Section 11.03. The failure by Owner to exercise its option
under Section 11.03 with respect to any subletting shall not be deemed a waiver
of such option with respect to any extension of such subletting or any
subsequent subletting of the premises affected thereby or any other portion of
the Demised Premises. If (a) Owner shall (i) fail or refuse to consent to any
proposed subletting in accordance with the provisions of this Lease, or (ii)
exercise any of its options under this Section 11.03, or (b) any proposed
subletting shall fail to be consummated for any reason whatsoever, Tenant shall
indemnify Owner from all loss, cost, liability, damage and expense, including,
but not limited to, reasonable counsel fees and disbursements, arising from any
claims against Owner by any broker or other person, for a brokerage commission
or other similar compensation in connection with any such proposed subletting.
C. If Owner shall have exercised the option contained
in Subsection 11.03.B to terminate this Lease or eliminate the entire Demised
Premises or any portion of the Demised Premises in connection with any proposed
subletting, and Owner shall thereafter relet the entire Demised Premises or that
portion thereof which is eliminated, as the case may be, then, in those events,
and provided Tenant is not then in default under any of the terms, covenants or
conditions of this Lease on Tenant's part to be observed or performed beyond
applicable grace periods, Owner shall pay to Tenant annually, at the end of each
calendar year during which such reletting shall
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continue, a sum equal to fifty (50%) percent of the Owner's Profits (as the term
"Owner's Profits" is hereinafter defined) received by Owner in connection with
any such reletting, but only with respect to that period expiring on the end of
the Demised Term, or if Owner has exercised the option contained in Subsection
11.03.B to terminate this Lease only with respect to that period which would
have comprised the unexpired portion of the Demised Term of this Lease had Owner
not so exercised such option, as the case may be. If Tenant shall sublet all or
any portion of the Demised Premises in accordance with the provisions of
Subsection 11.03.B, Tenant shall pay to Owner annually, at the end of each
calendar year during which any such subletting shall continue, a sum equal to
fifty (50%) percent of Tenant's Profits (as the term "Tenant's Profits" is
hereinafter defined) received by Tenant in connection with any such subletting.
The term "Owner's Profits" shall mean the amount by which the rental received by
Owner during the term of any such reletting (deducting from such rental "Owner's
reletting costs" [as hereinafter defined] spread equitably over the term of such
reletting) exceeds the rental which would have been payable by Tenant to Owner
for the premises covering such reletting had not Owner exercised its option to
terminate or eliminate, as the case may be. The term "Owner's reletting costs"
shall mean with respect to each reletting by Owner of the Demised Premises or
portions thereof the cost to Owner of altering such premises in connection with
such reletting plus any reasonable rental concessions provided by Owner, any so-
called "takeover" obligations incurred by Owner, any brokerage commissions and
reasonable counsel fees incurred by Owner and any other reasonable expenses
incurred by Owner in connection with such reletting. The term "Tenant's Profits"
shall mean the amount by which the rental received by Tenant during the term of
any such subletting (deducting from such rental "Tenant's subletting costs" [as
hereinafter defined] spread equitably over the term of such subletting) exceeds
the rental payable by Tenant to Owner for the premises covered by such
subletting. There shall be deemed included in such rental received by Tenant
during the term of such subletting all sums paid for the sale or rental of any
fixtures, leasehold improvements, equipment, furniture or other personal
property, less, in the case of the sale thereof, the then net unamortized (on a
straight-line basis over the term of this Lease) cost thereof, which were
provided and installed in the sublet premises at the sole cost and expense of
Tenant and for which no allowance or other credit has been given. The term
"Tenant's subletting costs" shall mean with respect to each subletting by Tenant
of the Demised Premises or portions thereof the cost to Tenant of altering such
premises in connection with such subletting plus any rental concessions provided
by Tenant, any so-called "takeover" obligations incurred by Tenant, any
brokerage commissions and reasonable counsel fees incurred by Tenant and any
other reasonable expenses incurred by Tenant in connection with such subletting.
D. Owner and Tenant agree that any consideration paid
to Tenant or any subtenant or other person claiming through or under Tenant in
connection with an assignment of Tenant's interest in this Lease or the interest
of any subtenant or other person claiming through or under Tenant under any
sublease shall accrue to the benefit of Owner and not to the benefit of Tenant
or of any subtenant or other person claiming through or under Tenant or of the
creditors of Tenant or of any such subtenant or other person claiming through or
under Tenant. Accordingly, Owner and Tenant agree that if Tenant, or any
subtenant or other person claiming through or under Tenant shall assign or have
assigned its interest as Tenant under this Lease or its interest as subtenant
under any sublease, as the case may be, Tenant shall pay to Owner a sum equal to
any consideration paid to Tenant or any subtenant or other person claiming
through or under Tenant for such assignment. All sums payable under this
Subsection 11.04D shall be paid to Owner as additional rent immediately upon
receipt and, if requested by Owner, Tenant shall promptly enter into a written
agreement with Owner setting forth the amount of such sums to be paid to Owner,
however, neither Owner's failure to request the execution of such agreement nor
Tenant's failure to execute such agreement shall vitiate the provisions of this
Section 11.04. For the purposes of this Section, a trustee, receiver or other
representative of the Tenant's or any subtenant's estate under any federal or
state bankruptcy act shall be deemed a person claiming through or under Tenant.
Neither Owner's consent to any subletting nor anything contained in this Section
shall be deemed to grant to any subtenant or other person claiming through or
under Tenant the right to sublet all or any portion of the Demised Premises or
to permit the occupancy of all or any portion of the Demised Premises by others.
Neither any subtenant referred to in this Section nor its heirs, distributees,
executors, administrators, legal representatives, successors nor assigns,
without the prior consent of Owner in each instance, shall (i) assign, whether
by merger, consolidation or otherwise, mortgage or encumber its interest in any
sublease, in whole or in part, or (ii) sublet, or permit the subletting of, that
part of the Demised Premises affected by such subletting or any part thereof or
(iii) permit such part of the Demised Premises affected by such subletting or
any part thereof to be occupied or used for desk space, mailing privileges or
otherwise, by any person other than such subtenant, and any sublease shall
provide that any violation of the foregoing provisions of this sentence shall be
an event of default thereunder. The sale, pledge, transfer or other alienation
of (a) any of the issued and outstanding capital stock of any
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corporate subtenant (unless such stock is publicly traded on any recognized
security exchange or over-the-counter market) or (b) any interest in any
partnership or joint venture subtenant, however accomplished, and whether in a
single transaction or in a series of related or unrelated transactions, shall be
deemed for the purposes of this Section as an assignment of such sublease which
shall require the prior consent of Owner in each instance and any sublease shall
so provide.
E. Owner's Rights Upon Lease Disaffirmance: (1) In
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the event that, at any time after Tenant may have assigned Tenant's interest in
this Lease, this Lease shall be disaffirmed or rejected in any proceeding of the
types described in Subsections 16.01(c) and (d), or in any similar proceeding,
or in the event of termination of this Lease by reason of any such proceeding or
by reason of lapse of time following notice of termination given pursuant to
Section 16.01 based upon any of the Events of Default set forth in said
Subsections, Tenant, upon request of Owner given within thirty (30) days next
following any such disaffirmance, rejection or termination (and actual notice
thereof to Owner in the event of a disaffirmance or rejection or in the event of
termination other than by act of Owner), shall (i) pay to Owner all Fixed Rent,
additional rent and other charges due and owing by the assignee to Owner under
this Lease to and including the date of such disaffirmance, rejection or
termination, and (ii) as "tenant", enter into a new lease with Owner of the
Demised Premises for a term commencing on the effective date of such
disaffirmance, rejection or termination and ending on the Expiration Date unless
sooner terminated as in such lease provided, at the same Fixed Rent and then
executory terms, covenants and conditions as are contained in this Lease, except
that (a) Tenant's rights under the new lease shall be subject to the possessory
rights of the assignee under this Lease and the possessory rights of any person
claiming through or under such assignee or by virtue of any statute or of any
order of any court, and (b) such new lease shall require all defaults existing
under this Lease to be cured by Tenant with due diligence, and (c) such new
lease shall require Tenant to pay all increases in the Fixed Rent reserved in
this Lease which, had this Lease not been so disaffirmed, rejected or
terminated, would have accrued under the provisions of Article 23 of this Lease
after the date of such disaffirmance, rejection or termination with respect to
any period prior thereto. In the event Tenant shall default in its obligation to
enter into said new lease for a period of ten (10) days next following Owner's
request therefor, then, in addition to all other rights and remedies by reason
of such default, either at law or in equity, Owner shall have the same rights
and remedies against Tenant as if Tenant had entered into such new lease and
such new lease had thereafter been terminated as at the commencement date
thereof by reason of Tenant's default thereunder. Nothing contained in this
Section shall be deemed to grant to Tenant any right to assign Tenant's interest
in this Lease.
(2) If Tenant assumes this Lease in any proceeding of
the types described in Subsections 16.01(c) and (d), or in any similar
proceeding and proposes to assign the same pursuant to said proceeding to any
person or entity who shall have made a bona fide offer to accept an assignment
of this Lease on terms acceptable to the Tenant, then notice of such proposed
assignment shall be given to Owner by Tenant no later than twenty (20) days
after receipt by Tenant of such offer, but in any event no later than ten (10)
days prior to the date that Tenant shall make application to a court of
competent jurisdiction for authority and approval to enter into such assignment
and assumption. Such notice shall set forth (a) the name and address of such
person, (b) all of the terms and conditions of such offer, and (c) adequate
assurance of future performance by such person under the Lease, including,
without limitation, the assurance referred to in Section 365(b)(3) of the United
States Bankruptcy Code or any provisions in substitution thereof. Owner shall
have the prior right and option, to be exercised by notice to Tenant given at
any time prior to the effective date of such proposed assignment, to accept an
assignment of this Lease upon the same terms and conditions and for the same
consideration, if any, as the bona fide offer made by such person, less any
brokerage commissions which would otherwise be payable by Tenant out of the
consideration to be paid by such person in connection with the assignment of
this Lease.
(3) The term "adequate assurance of future
----------------------------
performance" as used in this Lease shall mean that any proposed assignee shall,
-----------
among other things, (a) deposit with Owner on the assumption of this Lease the
sum of nine (9) months of the then Fixed Rent and increases therein pursuant to
Article 23 as security for the faithful performance and observance by such
assignee of the terms and obligations of this Lease, (b) furnish Owner with
financial statements of such assignee for the prior three (3) fiscal years, if
available, as finally determined after an audit and certified as correct by a
certified public accountant, which financial statements shall show a net worth
of at least six (6) times the Fixed Rent and increases therein pursuant to
Article 23 then payable for each of such three
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(3) years, (c) grant to Owner a security interest in such property of the
proposed assigned as Owner shall deem necessary to provide adequate assurance of
the performance by such assignee of its obligations under the Lease.
Section 11.05. A. Supplementing the provisions of Article 11, as
long as Tenant is not in default under any of the terms, covenants or conditions
of this Lease on Tenant's part to be observed and performed beyond applicable
grace periods, BLACKROCK, INC., Tenant named herein, shall have the right,
without the prior consent of Owner, to assign its interest in this Lease, for
the use permitted in this Lease, to any subsidiary or affiliate of Tenant named
herein, which is in the same general line of business as Tenant named herein
(except for PNC Bank which shall operate its general line of business subject,
however, to the provisions of Article 2) and only for such period as it shall
remain such subsidiary or affiliate. For the purposes of this Article: (a) a
"subsidiary" of Tenant named herein shall mean any corporation not less than
fifty-one (51%) percent of whose outstanding voting stock at the time shall be
owned by Tenant named herein, and (b) an "affiliate" of Tenant named herein
shall mean any corporation, partnership or other business entity which controls
or is controlled by, or is under common control with Tenant. For purposes of
this Section 11.05, PNC Bank is deemed an "affiliate" of Tenant. For the purpose
of the definition of "affiliate" the word "control" (including, "controlled by"
and "under common control with") as used with respect to any corporation,
partnership or other business entity, shall mean the possession of the power to
direct or cause the direction of the management and policies of such
corporation, partnership or other business entity, whether through the ownership
of voting securities or contract. Within ten (10) days after the execution
thereof, Tenant shall deliver to Owner all of the following: (I) a duplicate
original instrument of assignment, in form and substance satisfactory to Owner,
duly executed by Tenant, in which Tenant shall (a) waive all notices of default
given to the assignee, and all other notices of every kind or description now or
hereafter provided in this Lease, by statute or rule of law, and (b) acknowledge
that Tenant's obligations with respect to this Lease shall not be discharged,
released or impaired by (i) such assignment, (ii) any amendment or modification
of this Lease, whether or not the obligations of Tenant are increased thereby,
(iii) any further assignment or transfer of Tenant's interest in this Lease,
(iv) any exercise, non-exercise or waiver by Owner of any right, remedy, power
or privilege under or with respect to this Lease, (v) any waiver, consent,
extension, indulgence or other act or omission with respect to any other
obligations of Tenant under this Lease, (vi) any act or thing which, but for the
provisions of such assignment, might be deemed a legal or equitable discharge of
a surety or assignor, to all of which Tenant shall consent in advance, and (c)
expressly waive and surrender any then existing defense to its liability
hereunder it being the purpose and intent of Owner and Tenant that the
obligations of Tenant hereunder as assignor shall be absolute and unconditional
under any and all circumstances, and (II) an instrument, in form and substance
satisfactory to Owner, duly executed by the assignee, in which such assignee
shall assume the observance and performance of, and agree to be personally bound
by, all of the terms, covenants and conditions of this Lease on Tenant's part to
be observed and performed.
B. Further supplementing the provisions of Article
11, as long as Tenant is not in default under any of the terms, covenants or
conditions of this Lease on Tenant's part to be observed and performed beyond
applicable grace periods, BLACKROCK, INC., Tenant named herein, shall have the
right without the prior consent of Owner, to sublet to, or permit the use or
occupancy of, all or any part of the Demised Premises by (x) any subsidiary or
affiliate (as said terms are defined in Section 11.05. A.) of Tenant named
herein for the use permitted in this Lease and (y) solely with respect to
portions constituting less than fifty (50%) percent of the Demised Premises in
the aggregate, any entity, the business of which was originally a division or
component of Tenant or was otherwise a part of or related to Tenant's business,
but thereafter as a result of a so-called spin off or other sale occurring after
the Commencement Date is no longer a division, component or otherwise part of or
related to Tenant's business. Tenant shall give prior written notice to Owner of
any such proposed subletting, and within ten (10) days prior the commencement of
said subletting, Tenant shall deliver to Owner an agreement, in form and
substance satisfactory to Owner, duly executed by Tenant and said subtenant, in
which said subtenant shall assume performance of and agree to be personally
bound by, all of the terms, covenants and conditions of this Lease which are
applicable to said subtenant and such subletting. Tenant shall give prompt
notice to Owner of any such use or occupancy of all or any part of the Demised
Premises and such use or occupancy shall be subject and subordinate to all of
the terms, covenants and conditions of this Lease. No such use or occupancy
shall operate to vest in the user or occupant any right or interest in this
Lease or the Demised Premises. For the purposes of determining the number of
subtenants or occupants in the Demised Premises, the occupancy of any such
permitted subsidiary or affiliate of Tenant shall be deemed the occupancy of
Tenant and such subsidiary or affiliate shall not be counted as a subtenant or
occupant for the purposes of Section 11.03 and the provisions of Section 11.03
relating to Owner's option to terminate this Lease and the provisions of
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Section 11.03 relating to Subletting Profits shall not be applicable to any
proposed subletting to any such subsidiary or affiliate of Tenant pursuant to
the provisions of this Section.
Section 11.06. If Tenant desires to determine any dispute between
Owner and Tenant as to the reasonableness of Owner's decision to refuse to
consent to (a) any subletting in accordance with the provisions of Section
11.03, or (b) an assignment of Tenant's interest in this Lease in accordance
with the provisions of Section 11.03 or (c) the sale of Tenant's stock in
accordance with the provisions of Section 11.03, such dispute shall be settled
and finally determined by arbitration in the City of New York in accordance with
the following provisions of this Section. Within five (5) days next following
the giving of any notice by Tenant to Owner stating that it wishes such dispute
to be so determined, Owner and Tenant shall each give notice to the other
setting forth the name and address of an arbitrator designated by the party
giving such notice. If either party shall fail to give notice of such
designation within said five (5) days, then the arbitrator chosen by the other
side shall make the determination alone. The two arbitrators shall designate a
third arbitrator. If the two arbitrators shall fail to agree upon the
designation of a third arbitrator within five (5 days after the designation of
the second arbitrator, then either party may apply to the Supreme Court of the
State of New York, New York County, or to any other court having jurisdiction,
for the designation of such arbitrator. All arbitrators shall be persons who
shall have had at least ten (10) years continuous experience in the business of
appraising or managing real estate or acting as real estate agents or brokers in
the Borough of Manhattan. The three arbitrators shall conduct such hearings as
they deem appropriate, making their determination in writing and giving notice
to Owner and Tenant of their determination as soon as practicable, and if
possible, within five (5) days after the designation of the third arbitrator;
the concurrence of any two of said arbitrators shall be binding upon Owner and
Tenant, or, in the event no two of the arbitrators shall render a concurrent
determination, then the determination of the third arbitrator designated shall
be binding upon Owner and Tenant. Any award rendered in any arbitration held
pursuant to this Section shall be final and binding upon Owner and Tenant,
whether or not a judgment shall be entered in any court. Each party shall pay
its own counsel fees and expenses, if any, in connection with any arbitration
under this Section, including the expenses and fees of any arbitrator selected
by it in accordance with the provisions of this Section, and the parties shall
otherwise share all other expenses and fees of any such arbitration. The
arbitrators shall be bound by the provisions of this Lease, and shall not add
to, subtract from or otherwise modify such provisions.
Section 11.07. A. The words "for undivided occupancy" as used in
Section 11.04.A with respect to subletting, shall be deemed to mean that neither
the premises sublet to any subtenant, nor any part thereof shall be further
sublet by any such subtenant or occupied by any reason other than such
subtenant.
B. In determining whether any proposed subletting will
impose any additional burden upon Owner in the operation of the Building, if the
space proposed to be sublet is vacant or not fully utilized, it shall be assumed
that such space is being fully utilized by Tenant for Tenant's normal business
purposes immediately prior to the proposed subletting and the additional burden
in question shall be the burden, if any, above and beyond that which Owner would
have had if such space were being fully utilized by Tenant for Tenant's normal
business purposes immediately prior to the proposed subletting.
Section 11.08. Owner agrees that (i) so long as Owner maintains a
directory in the lobby of the Building, Tenant shall be entitled to a reasonable
number of listing spaces on said directory for the names of Tenant, its partners
and associates and other permitted occupants of the Demised Premises, and (ii)
so long as Owner maintains the names of other tenants in the elevators serving
the floors occupied by such other tenants to indicate the floors so occupied,
Owner will similarly maintain the name of Tenant and, in accordance with
standard practices adopted for the Building by Owner, the names of other
permitted occupants of the Demised Premises, to indicate the floors occupied by
Tenant and such other permitted subtenants.
Section 11.09. Supplementing the provisions of Article 11, as long as
Tenant is not then in default under any of the terms, covenants or conditions of
this Lease on Tenant's part to be observed or performed beyond applicable grace
periods, BLACKROCK, INC., Tenant named herein, shall have the right without the
prior consent of Owner to assign Tenant's interest in this Lease to any person,
corporation, partnership, or other business entity which is a successor of
Tenant, either by merger or consolidation or the purchase of all or
substantially all of the assets, business and goodwill of BLACKROCK, INC.,
Tenant named herein, provided that said person, corporation, partnership or
other business entity shall have a net worth, as determined in accordance with
generally accepted
35
<PAGE>
accounting principles consistently applied, at least equal to that of Tenant
named herein as of the date of such merger or consolidation or purchase, and
provided further that such successor, person, corporation, partnership or other
business entity shall continue to operate Tenant's present business in the
Demised Premises and the interest of Tenant named herein in this Lease is not
the sole or principal asset of Tenant named herein and such assignment is made
for a good business purpose. At the time of said proposed assignment, Tenant
shall deliver to Owner a detailed statement of the financial condition of the
aforesaid proposed assignee, prepared in accordance with generally accepted
accounting principles applied on a consistent basis, sworn to by an executive
officer of Tenant and the proposed Assignee, and certified without qualification
by a firm of reputable independent certified public accountants, reasonably
approved by Owner, which statement shall reflect the financial condition of the
aforesaid proposed assignee at that time. Any so called "Big Four" accounting
firm shall be deemed approved by Owner. Notwithstanding anything contained in
this Section to the contrary, Owner shall have no obligation to consent to such
assignment if in Owner's reasonable judgment the aforesaid proposed assignee
shall not have a net worth, consisting of assets and liabilities in types and
amounts satisfactory to Owner, at least equal to that of Tenant as of the date
of such merger or consolidation or purchase or the interest of Tenant named
herein in this Lease is the sole or principal asset of Tenant named herein or
such assignment is not made for a good business purpose. In the event of any
dispute between Owner and Tenant as to the reasonableness of Owner's refusal to
consent to any such assignment such dispute shall be determined by arbitration
in the City of New York in accordance with the rules and regulations then
obtaining of the American Arbitration Association or its successor. Any such
determination shall be final and binding upon the parties whether or not a
judgment shall be entered in any court. If the determination of any such
arbitration shall be adverse to Owner, Owner, nevertheless, shall not be liable
to Tenant for a breach of Owner's covenant not unreasonably to withhold such
consent, and Tenant's sole remedy in such event shall be to enter into the
proposed assignment. Even if Owner consents to such an assignment, no such
assignment shall be valid, unless, within ten (10) days after the execution
thereof, Tenant shall deliver to Owner (I) a duplicate original instrument of
assignment in form and substance reasonably satisfactory to Owner duly executed
by Tenant, acknowledged before a notary public, in which Tenant shall (a) waive
all notices of default given to the assignee and all other notices of every kind
or description, now or hereafter provided in this Lease, by statute or by rule
of law; (b) acknowledge that Tenant's obligations with respect to this Lease
shall not be discharged, released or impaired by (i) such assignment; (ii) any
amendment or modification of this Lease (whether or not the obligations of
Tenant are increased thereby); (iii) any further assignment or transfer of
Tenant's interest in this Lease; (iv) any exercise, non-exercise or waiver by
Owner of any right, remedy, power or privilege under or with respect to this
Lease; (v) any waiver, consent, extension, indulgence or other act or omission
with respect to any of the obligations of Tenant under this Lease; (vi) any act
or thing which, but for the provisions of such assignment, might be deemed a
legal or equitable discharge of a surety or assignor, to all of which Tenant
shall consent in advance; and (c) expressly waive and surrender any then
existing defense to its liability thereunder, it being the purpose and intent of
Owner and Tenant that the obligations of Tenant hereunder as assignor shall be
absolute and unconditional under any and all circumstances; and (II) an
instrument in form and substance reasonably satisfactory to Owner, duly executed
by the proposed assignee, acknowledged before a notary public, in which such
proposed assignee shall assume observance and performance of, and agree to be
bound by, all of the terms, covenants and conditions of this Lease on Tenant's
part to be performed.
Section 11.10 Supplementing the provisions of Section 11.08 so long as
Owner shall maintain the names of occupants of the Building and the floors on
which they are located, in the elevators serving the Demised Premises, Owner
shall list the names of Tenant and any permitted occupants of the Demised
Premises (not to exceed the number of names which can reasonably be placed in
the space proportionately allocated to Tenant in such elevators using Building
standard size lettering) in such elevators.
Section 11.11. Notwithstanding anything to the contrary contained in
this Lease, in the event that any subtenant of at least one (1) entire floor of
the Demised Premises (any such subtenant is referred to as the "Prime
-----
Subtenant") desires to further sublet all or any portion of the premises sublet
---------
by it from Tenant, Owner agrees not to unreasonably withhold, delay or condition
Owner's prior consent to such further subletting by such Prime Subtenant
provided, however, that the occupancy restrictions on the number of permitted
occupants set forth in subsection C of Section 11.03 shall apply in all respects
to such further subletting as if such further subletting were made by Tenant and
such Prime Subtenant shall be required to pay to Owner a sum equal to one half
(1/2) of any Further Subletting Profit, as such term is hereinafter defined,
received by such Prime Subtenant or any other person claiming through or under
such Prime Subtenant in connection with such further subletting. "Further
-------
Subletting Profit" shall mean all rentals and other sums (including, but not
-----------------
limited to, sums paid for the sale or rental of any fixtures, leasehold
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improvements, equipment, furniture or other personal property, less, in the case
of the sale or rental thereof, the then net unamortized [on a straight-line
basis over the useful life of the property in question] cost thereof and any
financing costs charged by the Prime Subtenant to such subtenant therefor which
were provided and installed in the further sublet premises at the sole cost and
expense of the Prime Subtenant and for which no allowance or other credit has
been given) paid by any sub-subtenant to such Prime Subtenant or other person
claiming through or under such Prime Subtenant in connection with (i) any
further subletting of the entire sublet premises in excess of the rental and any
increases therein then payable by such Prime Subtenant to Tenant under such
subletting or (ii) any further subletting of a portion of the sublet premises in
excess of that proportion of the rental and any increases therein then payable
by such Prime Subtenant to Tenant under such subletting which the area of the
portion of the sublet premises so further sublet bears to the total area of the
sublet premises; in computing any Further Subletting Profit there shall be
deducted reasonable expenses incurred by such subtenant in connection with such
further subletting, including, without limitation, a reasonable brokerage
commission, reasonable alteration costs, reasonable attorney's fees, reasonable
advertising fees and reasonable rent holiday periods, which deductions for such
brokerage commission, alteration costs, rental holidays, advertising fees and
counsel fees shall be spread equitably over the term of such further subletting.
Owner and Tenant agree that if such Prime Subtenant or any other person claiming
through or under such Prime Subtenant shall assign or have assigned its interest
as subtenant under such subletting or its interest as further subtenant under
any further sublease, as the case may be, such Prime Subtenant shall pay to
Owner a sum equal to any consideration paid to such Prime Subtenant or to any
further subtenant or other person claiming through or under such Prime Subtenant
for such assignment less any reasonable reimbursement to such Prime Subtenant
for the cost of the transaction, any Alterations made by such Prime Subtenant to
the premises and any furniture or equipment sold to the assignee. For the
purposes of this subsection, a trustee, receiver or other representative of such
Prime Subtenant's or any other further subtenant's estate under any Federal or
State Bankruptcy Act shall be deemed a person claiming through or under such
Prime Subtenant. Notwithstanding anything to the contrary contained in the
foregoing provisions of this subsection, Owner may, however, withhold consent to
any such further subletting by such Prime Subtenant if in Owner's reasonable
judgment the occupancy of the proposed further subtenant will tend to impair the
character or dignity of the Building or impose any additional material burden
upon Owner in the operation of the Building or the proposed further subtenant
shall be a person or entity with whom Owner is then negotiating or discussing to
lease space in the Building. The provisions of this Section 11.11 shall not be
deemed to confer any rights upon any such Prime Subtenant or be deemed a third
party beneficiary contract, or be enforceable in any way by such Prime
Subtenant. In the event of any dispute between Owner and Tenant as to the
reasonableness of Owner's refusal to consent to any such further subletting,
such dispute shall be determined by arbitration in the City of New York in
accordance with the provisions of Article 36. Any such determination shall be
final and binding upon the parties, whether or not a judgment shall be entered
in any court. If the determination of any such arbitration shall be adverse to
Owner, Owner, nevertheless, shall not be liable to Tenant or to such Prime
Subtenant for a breach of Owner's covenant not unreasonably to withhold such
consent and Tenant's and such Prime Subtenant's sole remedy in such event shall
be to enter into the proposed further subletting.
Section 11.12. A. Owner covenants and agrees, for the benefit of any
subtenant under a Protected Sublease (as hereinafter defined), at Tenant's or
such subtenant's request, to execute and deliver a non-disturbance agreement,
which, in Owner's reasonable opinion, is in customary and standard form for a
like transaction, provided that in any case, such non-disturbance agreement
shall contain the provisions of subsection C of this Section 11.12, at the time
such Protected Sublease is made and approved, confirming Owner's agreement to
recognize such subtenant as the direct tenant of Owner upon the termination of
this Lease by reason of default or insolvency of Tenant hereunder, provided
that:
(i) the non-disturbance agreement shall
provide that the subtenant attorns to Owner either upon, at Owner's election,
(a) all of the terms and conditions of this Lease (modified to reflect the space
covered by the Protected Sublease and the elimination of any rights under
Articles 38, 29, 40, 41, 42, 43 and 44) or (b) upon all of the terms and
conditions set forth in the "Protected Sublease"; and
(ii) Owner shall be reimbursed for its
reasonable out-of-pocket expenses, including reasonable legal fees, in
connection with such non-disturbance agreement.
B. As used herein, a "Protected Sublease" shall mean
a sublease which:
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(1) Owner has consented to;
(2) is with a subtenant who is not a subsidiary
or affiliate of Tenant and who has a net worth, determined in accordance with
generally accepted accounting principles consistently applied, equal to at least
FIFTEEN MILLION AND 00/100 ($15,000,000.00) DOLLARS if the sublease is for not
more than one (1) entire floor, which sum shall be increased by FIFTEEN MILLION
AND 00/100 ($15,000,000.00) DOLLARS for each additional floor contained within
the Protected Sublease. At the time of the request for such non-disturbance
agreement, Tenant shall deliver to Owner a reasonably detailed statement of the
financial condition of the subtenant, prepared in accordance with generally
accepted accounting principles consistently applied, sworn to by an executive
officer, principal or partner of the subtenant and certified without
qualification by a firm of reputable independent certified public accountants
which is one of the so-called "big six" accounting firms or their successors, or
such other independent certified public accountant reasonably acceptable to
Owner, which statement shall reflect the financial condition of the subtenant at
the time of Tenant's request for the non-disturbance agreement;
(3) has a term of at least five (5) years;
(4) provides for the demise of at least one (1)
entire floor of the Demised Premises which is an "end floor" (that is, the then
highest or lowest floor of the block of contiguous floors of the Demised
Premises as constituted at the time in question) and may include other entire
floors of the Demised Premises provided they are all contiguous to each other
and to such "end floor" (for the purposes of determining contiguity, any space
leased to Tenant under this Lease which has been eliminated from the Demised
Premises pursuant to the provisions of Section 11.03 shall not be deemed to be
space leased to Tenant under this Lease); and
(5) provides for Fixed Rent and additional rent
equal to or greater than, on a per rentable square foot basis, the Fixed Rent,
and all other applicable additional rent provided for in this Lease with respect
to such portion of the Demised Premises (or which provides for the escalation of
such subtenant's rental to such level at such time as it seeks to invoke the
protection of the non-disturbance agreement).
C. Nothing contained in this Section 11.12 shall
impose upon Owner any liability (a) for any default by Tenant under the
Protected Sublease, occurring prior to any date upon which Owner shall become
landlord of any such subtenant, (b) for any credits, offsets or claims against
the rent under the Protected Sublease as a result of any acts or omissions of
Tenant, including, but not limited to, any free rent provided to any such
subtenant in the Protected Sublease, (c) for any rent paid in advance by any
such subtenant under a Protected Sublease beyond the rent period next following
the current rent period, (d) for any of the obligations of the sublessor under
the Protected Sublease, to make any payment to such subtenant or for any
previous acts or omissions of the sublessor thereunder, including, but not
limited to, any obligation of sublessor to perform any improvements in the space
affected by the Protected Sublease to make a contribution to the subtenant in
lieu of such improvements or otherwise to be responsible under any "take-over"
agreement or any other obligation to make any payment to such subtenant whether
or not such obligation arises from any such previous acts or omissions of the
sublessor thereunder, or (e) arising from any modification of the Protected
Sublease not consented to by Owner, and the provisions of any such non-
disturbance agreement may so provide.
D. The obligations of Owner under the provisions of
subparagraph A of this Section 11.12 may be conditioned upon the existence of
any one or more of the following circumstances at the time of the termination of
this Lease:
(1) any such subtenant shall not be in default in
the observance or performance of any of the covenants of the Protected Sublease
on the part of such subtenant to be observed or performed beyond the applicable
grace periods provided therein for the curing of such default; and
(2) any such subtenant shall have furnished to
Owner a statement, in writing, as to the above circumstance (1) within fifteen
(15) days after Owner shall have made written demand for such statement.
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Section 11.13. Notwithstanding anything to the contrary contained in
this Lease, Tenant may, without Owner's consent but with prior to notice to
Owner, sublet all or any portion of the Demised Premises for all or any portion
of the remaining balance of the Demised Term to the New York City Industrial
Development Agency ("NYCIDA; the sublease to NYCIDA is referred to as the
"NYCIDA Sublease"), and in such event, NYCIDA shall further sublease the sublet
premises for the term of the NYCIDA Sublease to Tenant or Tenant's affiliates,
as defined in Section 11.05A (the "NYCIDA Sub-Sublease"), provided that the
following conditions are met:
(i) the NYCIDA Sublease shall provide that NYCIDA
shall have no right to occupy any portion of the
sublet premises or place anyone other than
Tenant into occupancy of the sublet premises,
and the NYCIDA Sublease shall provide that
NYCIDA shall sub-sublease the sublet premises to
Tenant or its affiliates for Tenant's or such
affiliate's use and occupancy;
(ii) the NYCIDA Sublease and the NYCIDA Sub-Sublease
shall each state that it is subject and
subordinate in all respects to this Lease and
all the matters to which this Lease is subject
and subordinate;
(iii) there shall be no Fixed Rent in excess of TEN
AND 00/100 ($10.00) DOLLARS under the NYCIDA
Sublease and the rental under the NYCIDA Sub-
Sublease shall not exceed an amount equal to the
debt service payments on notes or bonds to be
issued by NYCIDA and (a) except for these
payments, the NYCIDA Sublease and the NYCIDA
Sub-Sublease will generate no direct economic
return to either Tenant or NYCIDA, (b) a default
of Tenant under the NYCIDA Sub-Sublease with
respect to these payments or any other term or
condition of the NYCIDA Sub-Sublease shall not
entitle NYCIDA to any remedies or rights under
this Lease, (c) Tenant shall hold harmless and
indemnify and defend (with counsel reasonably
acceptable to Owner) Owner from any and all
liability, claims, suits, demands, judgments,
costs and expenses including, but not limited
to, reasonable counsel fees and disbursements,
arising from or in connection with any such
default by Tenant under the NYCIDA Sublease and
NYCIDA Sub-Sublease or violation of the terms of
this consent and (d) all provisions of this
Lease including, but not limited to, the
provisions of Article 11, shall continue in full
force and effect and shall be applied and
interpreted as though the NYCIDA Sublease and
the NYCIDA Sub-Sublease were not in effect and
did not apply to this Lease.
(iv) the NYCIDA Sublease will, by its terms, expire
not later than one (1) business day prior to the
expiration date of the Demised Term and the
NYCIDA Sub-Sublease will, by its terms, expire
not later than one (1) business day prior to the
expiration date of the term of the NYCIDA
Sublease; and
(v) subject to any confidentiality requirements
imposed by NYCIDA a true and complete copy of
the aforesaid NYCIDA Sublease and NYCIDA Sub-
Sublease and a true and complete copy of each
amendment thereto shall be available for review
within ten (10) days after the execution and
delivery thereof by the parties thereto.
(vi) Owner, at no expense to Owner, will cooperate
with Tenant in Tenant's entering into the NYCIDA
Sublease and the NYCIDA Sub-Sublease provided
Owner's rights under this Lease are not
adversely affected by such cooperation, and
Owner's obligations under this Lease are not
increased by such cooperation.
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ARTICLE 12
OWNER'S INITIAL WORK
Section 12.01. "As Is" but for Owner's Initial Work: Tenant
-----------------------------------
acknowledges that Owner has made no representations to Tenant with respect to
the condition of the Demised Premises and Tenant agrees to accept possession of
the Demised Premises in the condition which shall exist on the Commencement Date
"as is" and further agrees that Owner shall have no obligation to perform any
work or make any installations in order to prepare the Demised Premises for
Tenant's occupancy except, as otherwise provided in Section 12.02 to the
contrary.
Section 12.02. Owner's Initial Work: A. Provided Tenant shall submit
--------------------
to Owner Tenant's Demolition Plans (as hereinafter defined) which shall be
entitled to meet with Owner's approval by September 1, 2002 then, at the time
set forth in Section 12.03, Owner shall perform the following work in the
Demised Premises and place the Demised Premises in a so called "broom clean
condition" (referred to herein as "Owner's Initial Work"): demolish the
--------------------
presently existing interior Alterations in the Demised Premises in accordance
with demolition plans ("Tenant's Demolition Plans") to be delivered by Tenant to
-------------------------
Owner on or prior to September 1, 2002, which Tenant's Demolition Plans shall be
subject to Owner's reasonable approval, and remove any asbestos from all
portions of the Demised Premises to be occupied by Tenant in accordance with
Legal Requirements so as to be able to deliver to Tenant a form ACP-5 with
respect to the Demised Premises upon Tenant's submission to Owner of plans which
are in compliance with all Legal Requirements and the provisions of this Lease.
As part of Owner's Initial Work, Owner shall perform re-fire proofing where
necessary after demolition (excluding planned removal of fire proofing by Tenant
in Tenant's Demolition Plans). Entry by Owner or its contractors into the
Demised Premises to perform Owner's Initial Work shall not constitute an actual
or constructive eviction, in whole or in part, or entitle Tenant to any
abatement or diminution of rent (except as otherwise provided in Section 12.03)
or relieve Tenant from any of its obligations under this Lease.
B. Owner's Initial Work required to be performed and
made by Owner pursuant to the provisions of this Section 12.02 shall be equal to
standards adopted by Owner for the Building and shall constitute a single, non-
recurring obligation on the part of Owner. In the event this Lease is renewed or
extended for a further term by agreement or operation of law, Owner's obligation
to perform such work shall not apply to such renewal or extension.
Section 12.03. Tenant shall accept the Demised Premises on the
Commencement Date in an "as is" "broom clean condition" and provided (i) Tenant
notifies Owner by September 1, 2002 to commence the performance of Owner's
Initial Work, and (ii) Tenant shall have submitted to Owner Tenant's Demolition
Plans which shall be entitled to meet with Owner's approval by September 1,
2002, Owner, at Owner's expense shall perform Owner's Initial Work. Provided
Tenant shall have so submitted to Owner Tenant's Demolition Plans which shall be
entitled to meet with Owner's approval, Owner shall commence the performance of
Owner's Initial Work within thirty (30) days after Tenant shall have vacated the
Demised Premises to enable Owner to commence such performance. Tenant shall not
be required to pay any portion of the Fixed Rent or increases therein pursuant
to the provisions of Article 23 applicable to the 2nd floor portion of Demised
Premises with respect to the period ("Initial Work Credit Period")from the
--------------------------
earlier of (a) the date, subsequent to the submission by Tenant to Owner of
Tenant's Demolition Plans which shall be entitled to meet with Owner's approval,
thirty (30) days following the date upon which Tenant has vacated the Demised
Premises to permit Owner to perform Owner's Initial Work therein, or (b) the
date when Owner commences the performance of Owner's Initial Work to and
including the date upon which Owner shall have substantially completed Owner's
Initial Work but Tenant shall otherwise be required to comply with all of the
other terms, covenants and conditions of this Lease on Tenant's part to be
observed or performed. If any portion ("Duplicative Portion") of the Initial
-------------------
Work Credit Period occurs during the Rent Holiday Period, then the Rent Holiday
Period shall be extended by the number of days occurring during the Duplicative
Portion to give effect to the rent holiday set forth in the foregoing sentence.
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ARTICLE 13
ACCESS TO DEMISED PREMISES
--------------------------
Section 13.01. Owner's Right to Enter: Owner and its agents shall have
---------------------
the following rights in and about the Demised Premises: (i) to enter the Demised
Premises at all times to examine the Demised Premises or for any of the purposes
set forth in this Article or for the purpose of performing any obligation of
Owner under this Lease or exercising any right or remedy reserved to Owner in
this Lease, or complying with any Legal Requirement which Owner is obligated to
comply with hereunder, and if Tenant, its officers, partners, agents or
employees shall not be personally present or shall not open and permit an entry
into the Demised Premises at any time when such entry shall be necessary, to use
a master key or to forcibly enter the Demised Premises; (ii) to erect, install,
use and maintain pipes, ducts and conduits in and through the Demised Premises;
(iii) to exhibit the Demised Premises to others except that Owner agrees not to
exhibit the Demised Premises to any prospective tenants at any time prior to the
last eighteen (18) months of the Term, as said Term may be extended pursuant to
the provisions of Article 42; (iv) to make such repairs, alterations,
improvements or additions, or to perform such maintenance, including, but not
limited to, the maintenance of all heating, air conditioning, ventilating,
elevator, plumbing, electrical, telecommunication and other mechanical
facilities, as Owner may deem necessary or desirable; (v) to take all materials
into and upon the Demised Premises that may be required in connection with any
such repairs, alterations, improvements, additions or maintenance but not to
store same except for temporary storage that may be required in connection with
any such repairs, alterations, improvements, additions or maintenance; and (vi)
to alter, renovate and decorate the Demised Premises at any time during the
Demised Term if Tenant shall have removed all or substantially all of Tenant's
property from the Demised Premises. The lessors under any Superior Lease and the
holders of any Mortgage shall have the right to enter the Demised Premises from
time to time through their respective employees, agents, representatives and
architects to inspect the same or to cure any default of Owner or Tenant
relating thereto upon reasonable notice except in cases of emergency. Owner
shall have the right, from time to time, to change the name, number or
designation by which the Building is commonly known which right shall include,
without limitation, the right to name the Building after any tenant of the
Building in the event that at any time after the Additional Space Commencement
Date, Tenant (or its affiliates or subsidiaries,) in contradistinction to
subtenants or other occupants, is not in occupancy of at least seven (7) full
floors of the Building. Provided that Tenant (or its affiliates) is in occupancy
of at least seven (7) full floors of the Building, Owner shall not permit any
tenant of the Building to have a so-called "monument sign" in the lobby of the
Building. Subject to the provisions of Section 19.02, Owner agrees, with
reasonable promptness, to repair any damage to the Demised Premises caused by
Owner or its agents in connection with their entry in the Demised Premises in
accordance with the provisions of this Section 13.01.
Section 13.02. Owner's Reservation of Rights to Portions of the
------------------------------------------------
Building: All parts (except surfaces facing the interior of the Demised
--------
Premises) of all walls, windows and doors bounding the Demised Premises
(including exterior Building walls, core corridor walls, doors and entrances),
all balconies, terraces and roofs adjacent to the Demised Premises, all space in
or adjacent to the Demised Premises used for shafts, stacks, stairways, chutes,
pipes, conduits, ducts, fan rooms, heating, air conditioning, ventilating,
plumbing, electrical, telecommunication and other mechanical facilities,
closets, service closets and other Building facilities, and the use thereof, as
well as access thereto through the Demised Premises for the purposes of
operation, maintenance, alteration and repair, are hereby reserved to Owner
subject to any specific provision of this Lease. Owner also reserves the right
at any time to change the arrangement or location of entrances, passageways,
doors, doorways, corridors, elevators, stairs, toilets and other public parts of
the Building, provided any such change does not permanently and unreasonably
obstruct Tenant's access to the Demised Premises. Nothing contained in this
Article shall impose any obligation upon Owner with respect to the operation,
maintenance, alteration or repair of the Demised Premises or the Building. In
the event that such access must be granted by Owner, Owner shall give prompt
notice of such grant of access to the persons listed on Tenant's emergency
contact list annexed as Exhibit 7 to this Lease. Notwithstanding anything to the
contrary contained in this Section 13.02, Owner agrees to maintain the existing
51/st/ Street and 52/nd/ Street entrances to the Building during the Demised
Term, subject to the provisions of this Lease.
Section 13.03. Access to Third Parties: Owner and its agents shall
-----------------------
have the right to permit access to the Demised Premises, whether or not Tenant
shall be present, to any receiver, trustee, assignee for the benefit of
creditors, sheriff, marshal or court officer entitled to, or reasonably
purporting to be entitled to, such access for the
41
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purpose of taking possession of, or removing, any property of Tenant or any
other occupant of the Demised Premises, or for any other lawful purpose, or by
any representative of the fire, police, building, sanitation or other department
of the City, State or Federal Governments. Neither anything contained in this
Section, nor any action taken by Owner under this Section, shall be deemed to
constitute recognition by Owner that any person other than Tenant has any right
or interest in this Lease or the Demised Premises.
Section 13.04. No Actual or Constructive Eviction: The exercise by
----------------------------------
Owner or its agents or by the lessor under any Superior Lease or by the holder
of any Mortgage of any right reserved to Owner in this Article shall not
constitute an actual or constructive eviction, in whole or in part, or entitle
Tenant to any abatement or diminution of rent, or relieve Tenant from any of its
obligations under this Lease, or impose any liability upon Owner, or its agents,
or upon any lessor under any Superior Lease or upon the holder of any such
Mortgage, by reason of inconvenience or annoyance to Tenant, or injury to or
interruption of Tenant's business, or otherwise.
Section 13.05. No repairs, alterations, improvements or additions made
by Owner pursuant to this Article 13 shall, when completed, result in any
material decrease of space on any floor of the Demised Premises or materially
adversely affect the appearance of any floor of the Demised Premises.
Section 13.06. Supplementing the provisions of Sections 13.01 and
13.02, Owner agrees that except in cases of emergency, any entry upon the
Demised Premises pursuant to the provisions of said Sections shall be made at
reasonable times, and only after reasonable advance notice to enable Tenant at
its option to have an employee or representative at the Demised Premises (which
may be mailed, delivered or left at the Demised Premises, notwithstanding any
contrary provisions of Article 27), and any work performed or installations made
pursuant to said Section shall be made with reasonable diligence and any such
entry, work or installations shall be made in a manner designed to minimize
interference with Tenant's normal business operations including, where
necessary, the employment of labor at overtime or other premium pay rates. In
cases of emergency Owner shall endeavor to give Tenant notice of any such entry
as promptly as reasonably practical under the circumstances (which notice may be
by telephone or personal delivery).
Section 13.07. Further supplementing the provisions of Section 13.01,
Owner' agrees that any pipes, ducts or conduits installed in or through the
Demised Premises during the Demised Term pursuant to the provisions of Section
13.01, shall either be concealed behind, beneath or within partitioning,
columns, ceilings or floors, or completely furred at points immediately adjacent
to partitioning, columns or ceilings, and that when the installation of such
pipes, ducts or conduits shall be completed, such pipes, ducts or conduits shall
not materially reduce the usable area of the Demised Premises.
Section 13.08. Owner agrees not to store materials or equipment on the
Building's seventh (7/th/) floor set back, except for davits and, on a temporary
basis, items required for repairs or cleaning of the Building. Owner agrees to
use reasonable efforts to locate such items in a manner designed to minimize any
obstruction of the views from the windows of the Demised Premises. Owner shall
maintain such setback in a manner consistent with standards of other first class
office buildings in mid-town Manhattan.
ARTICLE 14
VAULT SPACE
-----------
Section 14.01. The Demised Premises do not contain any vaults, vault
space or other space outside the boundaries of the Real Property,
notwithstanding anything contained in this Lease or indicated on any sketch,
blueprint or plan. Owner makes no representation as to the location of the
boundaries of the Real Property. All vaults and vault space and all other space
outside the boundaries of the Real Property which Tenant may be permitted to use
or occupy are to be used or occupied under a revocable license, and if any such
license shall be revoked, or if the amount of such space shall be diminished or
required by any Federal, State or Municipal Authority or by any public utility
company, such revocation, diminution or requisition shall not constitute an
actual or constructive eviction, in whole or in part, or entitle Tenant to any
abatement or diminution of rent, or relieve Tenant from any of its obligations
42
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under this Lease, or impose any liability upon Owner. Any fee, tax or charge
imposed by any governmental authority for any such vault, vault space or other
space shall be paid by Tenant.
ARTICLE 15
CERTIFICATE OF OCCUPANCY
------------------------
Section 15.01. Tenant will not at any time use or occupy, or permit
the use or occupancy of, the Demised Premises in violation of any Certificate(s)
of Occupancy covering the Demised Premises. Owner agrees that a temporary or
permanent Certificate(s) of Occupancy covering the Demised Premises except for
the Basement Space will be in force on the Commencement Date permitting the
Demised Premises to be used as "offices" and the Basement Space to be used as
storage . However, neither such agreement, nor any other provision of this
Lease, nor any act or omission of Owner, its agents or contractors, shall be
deemed to constitute a representation or warranty that the Demised Premises, or
any part thereof, may be lawfully used or occupied for any particular purpose or
in any particular manner, in contradistinction to mere use of the Demised
Premises exclusive of the Basement Space, as "offices" and the mere use of the
Basement Space for "storage".
ARTICLE 16
DEFAULT
-------
Section 16.01. Events of Default: Upon the occurrence, at any time
-----------------
prior to or during the Demised Term, of any one or more of the following events
(referred to herein, singly, as an "Event of Default" and collectively as
----------------
"Events of Default"):
-----------------
(a) if Tenant shall default in the payment when due of any
installment of Fixed Rent or any increase in the Fixed Rent or in the
payment when due of any additional rent, and such default shall
continue for a period of ten (10) days after notice by Owner to Tenant
of such default; or
(b) if Tenant shall default in the observance or performance of
any term, covenant or condition of this Lease on Tenant's part to be
observed or performed (other than the covenants for the payment of
Fixed Rent, any increase in the Fixed Rent and additional rent) and
Tenant shall fail to remedy such default within thirty (30) days after
notice by Owner to Tenant of such default, or if such default is of
such a nature that it cannot be completely remedied within said period
of thirty (30) days and Tenant shall not commence, promptly after
receipt of such notice, or shall not thereafter diligently prosecute
to completion, all steps necessary to remedy such default; or
(c) if Tenant shall file a voluntary petition in bankruptcy or
insolvency, or shall be adjudicated a bankrupt or insolvent, or shall
file any petition or answer seeking any reorganiza tion, arrangement,
composition, readjustment, liquidation, dissolution or similar relief
under the present or any future federal bankruptcy act or any other
present or future applicable federal, state or other statute or law,
or shall make an assignment for the benefit of creditors, or shall
seek or consent to or acquiesce in the appointment of any trustee,
receiver or liquidator of Tenant or of all or any part of Tenant's
property; or
(d) if, within ninety (90) days after the commencement of any
proceeding against Tenant, whether by the filing of a petition or
otherwise, seeking any reorganization, arrangement, composition,
readjustment, liquidation, dissolution or similar relief under the
present or any future federal bankruptcy act or any other present or
future applicable federal, state or other statute or law, such
proceeding shall not have been dismissed, or if, within thirty (30)
days after the appointment of any trustee, receiver or liquidator of
Tenant, or of all or any part of Tenant's property, without the
consent or acquiescence of Tenant, such appointment shall not have
been vacated or otherwise
43
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discharged, or if any execution or attachment shall be issued against
Tenant or any of Tenant's property pursuant to which the Demised
Premises shall be taken or occupied or attempted to be taken or
occupied; or
(e) if Tenant shall default in the observance or performance of
any term, covenant or condition on Tenant's part to be observed or
performed under any other lease with Owner of space in the Building
and such default shall continue beyond any grace period set forth in
such other lease for the remedying of such default; or
(f) if the Demised Premises shall become vacant for more than
three hundred sixty- five (365) days and Tenant is not thereafter
actively seeking subtenants; or
(g) if (i) Tenant's interest in this Lease shall devolve upon or
pass to any person, whether by operation of law or otherwise, or (ii)
there shall be any sale, pledge, transfer or other alienation
described in Section 11.01 of this Lease which is deemed an assignment
of this Lease for purposes of said Section 11.01, except as expressly
permitted under Article 11;
then, during such time as such Event(s) of Default is/are continuing, Owner may
at any time, at Owner's option, give to Tenant a five (5) days' notice of
termination of this Lease and, in the event such notice is given, this Lease and
the Demised Term shall come to an end and expire (whether or not said term shall
have commenced) upon the expiration of said five (5) days with the same effect
as if the date of expiration of said five (5) days were the Expiration Date, but
Tenant shall remain liable for damages and all other sums payable pursuant to
the provisions of Article 18.
Section 16.02. "Tenant"/Moneys Received: If, at any time (i) Tenant
-----------------------
shall be comprised of two (2) or more persons, or (ii) Tenant's obligations
under this Lease shall have been guaranteed by any person other than Tenant, or
(iii) Tenant's interest in this Lease shall have been assigned, the word
"Tenant", as used in Subsections (c) and (d) of Section 16.01, shall be deemed
to mean any one or more of the persons primarily or secondarily liable for
Tenant's obligations under this Lease. Any monies received by Owner from or on
behalf of Tenant during the pendency of any proceeding of the types referred to
in said Subsections (c) and (d) shall be deemed paid as compensation for the use
and occupation of the Demised Premises and the acceptance of any such
compensation by Owner shall not be deemed an acceptance of rent or a waiver on
the part of Owner of any rights under Section 16.01.
ARTICLE 17
REMEDIES
--------
Section 17.01. Owner's Right of Re-Entry and Right to Relet: If Tenant
--------------------------------------------
shall default in the payment when due of any installment of Fixed Rent or in the
payment when due of any increase in the Fixed Rent or any additional rent, or if
this Lease and the Demised Term shall expire and come to an end as provided in
Article 16:
(a) Owner and its agents and servants may immediately, or at any
time after such default or after the date upon which this Lease and
the Demised Term shall expire and come to an end, re-enter the Demised
Premises or any part thereof, without notice, either by summary
proceedings or by any other applicable action or proceeding, or
otherwise (without being liable to indictment, prosecution or damages
therefor), and may repossess the Demised Premises and dispossess
Tenant and any other persons from the Demised Premises and remove any
and all of their property and effects from the Demised Premises; and
(b) Owner, at Owner's option, may relet the whole or any part or
parts of the Demised Premises, from time to time, either in the name
of Owner or otherwise, to such tenant or tenants, for such term or
terms ending before, on or after the Expiration Date, at such rental
or rentals and upon such other conditions, which may include
concessions and free rent periods, as Owner, in its sole discretion,
may determine. Owner shall have no obligation to relet the Demised
Premises or any part
44
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thereof and shall in no event be liable for refusal or failure to
relet the Demised Premises or any part thereof, or, in the event of
any such reletting, for refusal or failure to collect any rent due
upon any such reletting, and no such refusal or failure shall operate
to relieve Tenant of any liability under this Lease or otherwise to
affect any such liability; Owner, at Owner's option, may make such
repairs, replacements, alterations, additions, improvements,
decorations and other physical changes in and to the Demised Premises
as Owner, in its sole discretion, considers advisable or necessary in
connection with any such reletting or proposed reletting, without
relieving Tenant of any liability under this Lease or otherwise
affecting any such liability.
Section 17.02. Waiver of Right to Redeem, etc.: Tenant hereby waives
-------------------------------
the service of any notice of intention to re-enter or to institute legal
proceedings to that end which may otherwise be required to be given under any
present or future law. Tenant, on its own behalf and on behalf of all persons
claiming through or under Tenant, including all creditors, does further hereby
waive any and all rights which Tenant and all such persons might otherwise have
under any present or future law to redeem the Demised Premises, or to re-enter
or repossess the Demised Premises, or to restore the operation of this Lease,
after (i) Tenant shall have been dispossessed by a judgment or by warrant of any
court or judge, or (ii) any re-entry by Owner, or (iii) any expiration or
termination of this Lease and the Demised Term, whether such dispossess, re-
entry, expiration or termination shall be by operation of law or pursuant to the
provisions of this Lease. The words "re-enter", "re-entry" and "re-entered" as
used in this Lease shall not be deemed to be restricted to their technical legal
meanings. In the event of a breach or threatened breach by Tenant, or any
persons claiming through or under Tenant, of any term, covenant or condition of
this Lease on Tenant's part to be observed or performed, Owner shall have the
right to enjoin such breach and the right to invoke any other remedy allowed by
law or in equity as if re-entry, summary proceedings and other special remedies
were not provided in this Lease for such breach. The right to invoke the
remedies hereinbefore set forth in this Lease is cumulative and shall not
preclude Owner from invoking any other remedy allowed by law or in equity. Owner
agrees that the first sentence of this Section 17.02 shall not be deemed a
waiver of Tenant's right to be served with any notice of petition and petition
of summary proceedings under the provisions of the Real Property Actions and
Proceedings Law of the State of New York and of any successor law of like import
then in force.
ARTICLE 18
DAMAGES
-------
Section 18.01. Amount of Owner's Damages: If this Lease and the
-------------------------
Demised Term shall expire and come to an end as provided in Article 16, or by or
under any summary proceeding or any other action or proceeding, or if Owner
shall re-enter the Demised Premises as provided in Article 17, or by or under
any summary proceeding or any other action or proceeding, then, in any of said
events:
(a) Tenant shall pay to Owner all Fixed Rent, additional rent
and other charges payable under this Lease by Tenant to Owner to the
date upon which this Lease and the Demised Term shall have expired and
come to an end or to the date of re-entry upon the Demised Premises by
Owner, as the case may be; and
(b) Tenant shall also be liable for and shall pay to Owner, as
damages, any deficiency (referred to as a "Deficiency") between the
----------
Fixed Rent reserved in this Lease for the period which otherwise would
have constituted the unexpired portion of the Demised Term and the net
amount, if any, of rents collected under any reletting effected
pursuant to the provisions of Section 17.01 for any part of such
period (first deducting from the rents collected under any such
reletting all of Owner's expenses in connection with the termination
of this Lease or Owner's re-entry upon the Demised Premises and with
such reletting including, but not limited to, all repossession costs,
brokerage commissions, legal expenses, attorneys' fees, alteration
costs and other expenses of preparing the Demised Premises for such
reletting). Any such Deficiency shall be paid in monthly installments
by Tenant on the days specified in this Lease for payment of
installments of Fixed Rent, Owner shall be entitled to recover from
Tenant each monthly Defi ciency as the same shall arise, and
45
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no suit to collect the amount of the Deficiency for any month shall
prejudice Owner's right to collect the Deficiency for any subsequent
month by a similar proceeding. Solely for the purposes of this
Subsection (b), the term "Fixed Rent" shall mean the Fixed Rent in
effect immediately prior to the date upon which this Lease and the
Demised Term shall have expired and come to an end, or the date of re-
entry upon the Demised Premises by Owner, as the case may be,
adjusted, from time to time, to reflect any increases which would have
been payable pursuant to any of the provisions of this Lease
including, but not limited to, the provisions of Article 23 of this
Lease if the term hereof had not been terminated; and
(c) At any time after the Demised Term shall have expired and
come to an end or Owner shall have re-entered upon the Demised
Premises, as the case may be, whether or not Owner shall have
collected any monthly Deficiencies as aforesaid, Owner shall be
entitled to recover from Tenant, and Tenant shall pay to Owner, on
demand, as and for liquidated and agreed final damages, a sum equal to
the amount by which the Fixed Rent reserved in this Lease for the
period which otherwise would have constituted the unexpired portion of
the Demised Term exceeds the then fair and reasonable rental value of
the Demised Premises for the same period, both discounted to present
worth at the rate of eight (8%) percent per annum. If, before
presentation of proof of such liquidated damages to any court,
commission or tribunal, the Demised Premises, or any part thereof,
shall have been relet by Owner for the period which otherwise would
have constituted the unexpired portion of the Demised Term, or any
part thereof, the amount of rent reserved upon such reletting shall be
deemed, prima facie, to be the fair and reasonable rental value for
the part or the whole of the Demised Premises so relet during the term
of the reletting. Solely for the purposes of this Subsection (c), the
term "Fixed Rent" shall mean the Fixed Rent in effect immediately
prior to the date upon which this Lease and the Demised Term shall
have expired and come to an end, or the date of re-entry upon the
Demised Premises by Owner, as the case may be, adjusted to reflect any
increases pursuant to the provisions of Article 23 for the Escalation
Year and Tax Escalation Year immediately preceding such event.
Section 18.02. Rents Under Reletting: If the Demised Premises, or any
---------------------
part thereof, shall be relet together with other space in the Building, the
rents collected or reserved under any such reletting and the expenses of any
such reletting shall be equitably apportioned for the purposes of this Article
18. Tenant shall in no event be entitled to any rents collected or payable under
any reletting, whether or not such rents shall exceed the Fixed Rent reserved in
this Lease. Nothing contained in Articles 16, 17 or this Article shall be deemed
to limit or preclude the recovery by Owner from Tenant of the maximum amount
allowed to be obtained as damages by any statute or rule of law, or of any sums
or damages to which Owner may be entitled in addition to the damages set forth
in Section 18.01.
ARTICLE 19
FEES AND EXPENSES; INDEMNITY
----------------------------
Section 19.01. Owner's Right to Cure Tenant's Default: If
--------------------------------------
Tenant shall default in the observance or performance of any term, covenant or
condition of this Lease on Tenant's part to be observed or performed beyond
applicable grace periods, Owner, at any time thereafter and without notice, may
remedy such default for Tenant's account and at Tenant's expense, without
thereby waiving any other rights or remedies of Owner with respect to such
default.
Section 19.02. Tenant's Indemnity and Liability Insurance
------------------------------------------
Obligations: A. Tenant agrees to indemnify and save Owner and "Owner's
-----------
Indemnitees" (as hereinafter defined) harmless of and from all loss, cost,
liability, damage and expense including, but not limited to, reasonable counsel
fees, penalties and fines, incurred in connection with or arising from (i) any
default by Tenant in the observance or performance of any of the terms,
covenants or conditions of this Lease on Tenant's part to be observed or
performed, or (ii) the breach or failure of any representation or warranty made
by Tenant in this Lease, or (iii) the use or occupancy or manner of use or
occupancy of the Demised Premises by Tenant or any person claiming through or
under Tenant, or (iv) any acts, omissions or
46
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negligence of Tenant or any such person, or the contractors, agents, servants,
employees, visitors or licensees of Tenant or any such person, in or about the
Demised Premises or the Building either prior to, during, or after the
expiration of, the Demised Term, including, but not limited to, any acts
omissions or negligence in the making or performing of any Alterations or any
installation, maintenance or removal of equipment referred to in Section 3.18.
Tenant further agrees to indemnify and save harmless Owner and Owner's
Indemnitees of and from all loss, cost, liability, damage and expense,
including, but not limited to, reasonable counsel fees and disbursements,
incurred in connection with or arising from any claims by any persons by reason
of injury to persons or damage to property occasioned by any use, occupancy,
act, omission or negligence referred to in the preceding sentence. "Owner's
-------
Indemnitees" shall mean the Owner, the shareholders or the partners comprising
-----------
Owner and its and their partners and shareholders, officers, directors,
employees, agents (including without limitation, any leasing and managing
agents) and contractors together with the lessor under any Superior Lease and
the holder of any Mortgage. If any action or proceeding shall be brought against
Owner or Owner's Indemnitees based upon any such claim and if Tenant, upon
notice from Owner, shall cause such action or proceeding to be defended at
Tenant's expense by counsel acting for Tenant's insurance carriers in connection
with such defense or by other counsel reasonably satisfactory to Owner, without
any disclaimer of liability by Tenant or such insurance carriers in connection
with such claim, Tenant shall not be required to indemnify Owner and Owner's
Indemnitees for counsel fees in connection with such action or proceeding.
B. Throughout the Demised Term Tenant shall maintain
comprehensive public liability and water legal liability insurance against any
claims by reason of personal injury, death and property damage occurring in or
about the Demised Premises covering, without limitation, the operation of any
private air conditioning equipment and any private elevators, escalators or
conveyors in or serving the Demised Premises or any part thereof, whether
installed by Owner, Tenant or others, and shall furnish to Owner duplicate
original policies of such insurance at least ten (10) days prior to the
Commencement Date and at least ten (10) days prior to the expiration of the term
of any such policy previously furnished by Tenant, in which policies Owner, and
Owner's Indemnitees shall be named as parties insured, which policies shall be
issued by companies, and shall be in form and amounts, reasonably satisfactory
to Owner.
Section 19.03. Payments: Tenant shall pay to Owner, within ten (10)
--------
days next following rendition by Owner to Tenant of bills or statements
therefor: (i) sums equal to all expenditures made and monetary obligations
incurred by Owner including, but not limited to, expenditures made and
obligations incurred for reasonable counsel fees and disbursements, in
connection with the remedying by Owner, for Tenant's account pursuant to the
provisions of Section 19.01, of any default of Tenant, and (ii) sums equal to
all losses, costs, liabilities, damages and expenses referred to in Section
19.02, and (iii) sums equal to all expenditures made and monetary obligations
incurred by Owner including, but not limited to, expenditures made and
obligations incurred for reasonable counsel fees and disbursements, in
collecting or attempting to collect the Fixed Rent, any additional rent or any
other sum of money accruing under this Lease or in enforcing or attempting to
enforce any rights of Owner under this Lease or pursuant to law, whether by the
institution and prosecution of summary proceedings or otherwise; and (iv) all
other sums of money (other than Fixed Rent) accruing from Tenant to Owner under
the provisions of this Lease. Any sum of money (other than Fixed Rent) accruing
from Tenant to Owner pursuant to any provision of this Lease, whether prior to
or after the Commencement Date, may, at Owner's option, be deemed additional
rent, and Owner shall have the same remedies for Tenant's failure to pay any
item of additional rent when due as for Tenant's failure to pay any installment
of Fixed Rent when due. Tenant's obligations under this Article shall survive
the expiration or sooner termination of the Demised Term.
Section 19.04. Tenant's Late Payments - Late Charges: If Tenant shall
-------------------------------------
fail to make payment of any installment of Fixed Rent or any increase in the
Fixed Rent or any additional rent within ten (10) days after the date when such
payment is due, Tenant shall pay to Owner, in addition to such installment of
Fixed Rent or such increase in the Fixed Rent or such additional rent, as the
case may be, as a late charge and as additional rent, a sum equal to two (2%)
percent per annum above the then current prime rate (as the term "prime rate" is
defined in Section 31.03) charged by Citibank (N.A.) or its successor of the
amount unpaid computed from the date such payment was due to and including the
date of payment.
Section 19.05. Owner agrees to indemnify and save Tenant harmless of
and from all loss, cost, liability, damage and expense including, but not
limited to, reasonable counsel fees, penalties and fines incurred in
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connection with or arising from (i) any default by Owner in the performance or
observance of any of the terms, covenants or conditions of this Lease on Owner's
part to be observed or performed, or (ii) any acts, omissions or negligence of
Owner or its employees, agents, contractors or servants in or about the Demised
Premises or the Building either prior to, during, or after, the expiration of
the Demised Term. Owner further agrees to indemnify and save harmless Tenant and
its agents of and from all loss, cost, liability, damage, and expense,
including, but not limited to, reasonable counsel fees incurred in connection
with or arising from any claims by any persons or damage to property occasioned
by any act, omission or negligence referred to in the preceding sentence. If any
action or proceeding shall be brought against Tenant or Tenant's agents based
upon any such claim and if Owner, upon notice from Tenant, shall cause such
action or proceeding to be defended at Owner's expense by counsel acting for
Owner's insurance carriers in connection with such defense or by other counsel
reasonably satisfactory to Tenant, without any disclaimer of liability by Owner
in connection with such claim, Owner shall not be required to indemnify Tenant
or Tenant's agents for counsel fees in connection with such action or
proceeding.
Section 19.06. Owner shall pay to Tenant, within ten (10) days next
following rendition by Tenant to Owner of statements therefor, or shall credit
Tenant, at Owner's election, against the next accruing monthly installments of
Fixed Rent, sums equal to all loss, costs, liabilities, damages and expenses
referred to in Section 19.05. Owner's obligations under this Article shall
survive the expiration or sooner termination of the Demised Term.
Section 19.07. If any claim, action or proceeding is made or brought
against either party (the "Indemnified Party"), and pursuant to which claim,
action or proceeding the other (the "Indemnifying Party") shall be obligated to
indemnify the Indemnified Party pursuant to the terms of this Lease, then the
Indemnifying Party at its sole cost and expense, shall resist or defend such
claim, action or proceeding in the Indemnified Party's name, if necessary, by
such attorneys as the Indemnified Party shall approve, which approval shall not
be unreasonably withheld. Attorney's for the Indemnifying Party's insurer are
hereby deemed approved for purposes of this Section. If any claim is made
against the Indemnified Party, it shall give notice of the claim to the
Indemnifying Party in order that the Indemnifying Party can undertake its
obligations pursuant to the first sentence of this Section. The Indemnifying
Party may not settle any such action involving the Indemnified Party unless the
Indemnified Party receives a general release relating to the subject matter of
the claim from the claimant in the action. Failure by the Indemnified Party to
notify the Indemnifying Party of any claim, action or proceeding shall not
affect the Indemnifying Party's obligations hereunder unless the failure to
notify is prejudicial to the Indemnifying Party. Notwithstanding the foregoing,
the Indemnified Party may retain its own attorneys to defend or resist in
defending any claim, action or proceeding involving potential liability of FIVE
MILLION ($5,000,000) DOLLARS or more, and the Indemnifying Party shall pay the
reasonable fees and disbursements of such attorneys. The provisions of this
Article shall survive the expiration or earlier termination of this Lease
ARTICLE 20
ENTIRE AGREEMENT
----------------
Section 20.01. Entire Agreement: This Lease contains the entire
----------------
agreement between the parties and all prior negotiations and agreements are
merged in this Lease. Neither Owner nor Owner's agents have made any
representations or warranties with respect to the Demised Premises, the
Building, the Real Property or this Lease except as expressly set forth in this
Lease and no rights, easements or licenses are or shall be acquired by Tenant by
implication or otherwise unless expressly set forth in this Lease. This Lease
may not be changed, modified or discharged, in whole or in part, orally and no
executory agreement shall be effective to change, modify or discharge, in whole
or in part, this Lease or any provisions of this Lease, unless such agreement is
set forth in a written instrument executed by the party against whom enforcement
of the change, modification or discharge is sought. All references in this Lease
to the consent or approval of Owner shall be deemed to mean the written consent
of Owner, or the written approval of Owner, as the case may be, and no consent
or approval of Owner shall be effective for any purpose unless such consent or
approval is set forth in a written instrument executed by Owner. In any case
where Owner agrees not unreasonably to withhold any consent or approval under
this Lease, such agreement shall be deemed to include an agreement on the part
of Owner not unreasonably to delay such consent or approval.
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ARTICLE 21
END OF TERM
-----------
Section 21.01. End of Term: On the date upon which the Demised Term
-----------
shall expire and come to an end, whether pursuant to any of the provisions of
this Lease or by operation of law, and whether on or prior to the Expiration
Date, Tenant, at Tenant's sole cost and expense, (i) shall quit and surrender
the Demised Premises to Owner, broom clean and in good order and condition,
ordinary wear excepted, and (ii) shall remove all of Tenant's Personal Property
and all other property and effects of Tenant and all persons claiming through or
under Tenant from the Demised Premises and the Building, and (iii) shall repair
all damage to the Demised Premises occasioned by such removal and (iv) shall, at
Owner's election, exercisable on or before the expiration or earlier termination
of the Demised Term, remove any private interior staircases in the Demised
Premises or connecting the Demised Premises or any part thereof with any other
space (referred to herein as the "Other Space") in the Building occupied by
-----------
Tenant, and restore those portions of the Demised Premises, the Other Space and
the Building affected by any such staircases (including, but not limited to, the
slabbing over of any openings) to the condition of each which existed prior to
the installation of any such staircases, and repair any damage to the Demised
Premises, Other Space and the Building occasioned by such removal.
Notwithstanding the provisions of subdivision (iv) of the foregoing sentence, in
the event Owner does not elect to have removed any such staircase referred to
therein, any such staircase shall be and remain the property of Owner at no cost
or expense to Owner. Owner shall have the right to retain any property and
effects which shall remain in the Demised Premises after the expiration or
sooner termination of the Demised Term, and any net proceeds from the sale
thereof, without waiving Owner's rights with respect to any default by Tenant
under the foregoing provisions of this Section. Tenant expressly waives, for
itself and for any person claiming through or under Tenant, any rights which
Tenant or any such person may have under the provisions of Section 2201 of the
New York Civil Practice Law and Rules and of any successor law of like import
then in force, in connection with any holdover summary proceedings which Owner
may institute to enforce the foregoing provisions of this Article. If said date
upon which the Demised Term shall expire and come to an end shall fall on a
Sunday or holiday, then Tenant's obligations under the first sentence of this
Section shall be performed on or prior to the Saturday or business day
immediately preceding such Sunday or holiday. Tenant's obligations under this
Section shall survive the expiration or sooner termination of the Demised Term.
Section 21.02. Supplementing the provisions of Section 21.01, except
as otherwise expressly provided in this Lease, Tenant shall have no obligations
to remove any of Tenant's Alterations and restore the Demised Premises to their
original condition. However, the foregoing shall not be deemed to relieve Tenant
of any obligations to repair damage to the Demised Premises occasioned by the
removal of such Alterations, Personal Property and other property and effects of
Tenant and all persons claiming through or under Tenant which Tenant elects to
remove from the Demised Premises and the Building. Tenant shall not be required
to remove any pre- existing staircases which exist in the Demised Premises as of
the Commencement Date or the Additional Space as of the Additional Space
Commencement Date.
ARTICLE 22
QUIET ENJOYMENT
---------------
Section 22.01. Quiet Enjoyment: Owner covenants and agrees with Tenant
---------------
that upon Tenant paying the Fixed Rent and additional rent reserved in this
Lease and observing and performing all of the terms, covenants and conditions of
this Lease on Tenant's part to be observed and performed, Tenant may peaceably
and quietly enjoy the Demised Premises during the Demised Term, subject,
however, to the terms, covenants and conditions of this Lease including, but not
limited to, the provisions of Section 37.01, and subject to the Superior Lease
and the Mortgage referred to in Section 7.01.
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ARTICLE 23
ESCALATION
----------
Section 23.01. Definitions: In the determination of any increase in
-----------
the Fixed Rent under the provisions of this Article, Owner and Tenant agree that
the following terms shall have the following meanings:
A. The term "Tax Escalation Year" shall mean each fiscal year
-------------------
commencing July 1st and ending on the following June 30th which shall include
any part of the Demised Term.
B. The term "Escalation Year" shall mean each calendar year which
---------------
shall include any part of the Demised Term.
C. The term "Taxes" shall be deemed to mean a sum equal to the
-----
aggregate of: (i) the product determined by multiplying (a) the then applicable
full New York City real estate tax rate in effect with respect to the Borough of
Manhattan by (b) the then applicable assessed valuation of the Real Property
plus (ii) amounts assessed by any business improvement district in which the
Real Property is located plus (iii) any other assessments, special or otherwise,
upon or with respect to the Real Property imposed by the City or County of New
York or any other taxing authority. If, due to any change in the method of
taxation, any franchise, income, profit, sales, rental, use and occupancy or
other tax or payments in lieu of any such taxes shall be substituted for, or
levied against Owner or any owner of the Building or the Real Property, in lieu
of any real estate taxes or assessments upon or with respect to the Real
Property, such tax or payments in lieu of any such taxes shall be included in
the term Taxes for the purposes of this Article.
D. The term "Owner's Basic Tax Liability" shall mean a sum equal
---------------------------
to the greater of (i) Taxes payable for the fiscal tax year commencing July 1,
2000 and ending June 30, 2001 or (ii) THREE MILLION NINE HUNDRED EIGHTY-EIGHT
THOUSAND SIX HUNDRED NINETY-EIGHT AND 00/100 ($3,988,698.00) DOLLARS.
E. The term "Demised Premises Area" shall mean 19,133 square
---------------------
feet.
F. The term "Building Area" shall mean 379,876 square feet with
-------------
respect to the determination of increases in Fixed Rent for the purposes of
Section 23.02 and 359,207 square feet with respect to the determination of
increases in Fixed Rent for the purposes of Section 23.04.
G. The term "Tenant's Proportionate Share" shall mean the
----------------------------
fraction, the denominator of which is the applicable Building Area and the
numerator of which is the Demised Premises Area.
H. (1) The term "Operating Expenses" shall, subject to the
------------------
provisions of Paragraph (2) of this Subsection 23.01.H, mean the aggregate cost
and expense incurred by Owner in the operation, maintenance, management and
security of the Real Property and any plazas, sidewalks and curbs adjacent
thereto including, without limitation, the cost and expense of the following:
(a) salaries, wages, medical, surgical and general
welfare and other so-called "fringe" benefits (including group
insurance and retirement benefits) for employees (including, but
not limited to, employees who provide twenty four (24) hour
services, seven (7) days per week throughout the year) of Owner
or any contractor of Owner engaged in the cleaning, operation,
maintenance or management of the Real Property, or engaged for
security purposes and/or for receiving or transmitting deliveries
to and from the Building, and payroll taxes and workmen's
compensation insurance premiums relating thereto,
(b) gas, steam, water and sewer rental,
(c) electricity,
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(d) utility taxes,
(e) rubbish removal,
(f) fire, casualty, liability, rent and other
insurance carried by Owner,
(g) repairs, repainting, replacement, maintenance
of grounds, and Included Improvements (as provided in Paragraph (2) of
this Subsection 23.01.H),
(h) Building supplies,
(i) uniforms and cleaning thereof,
(j) snow removal,
(k) window cleaning,
(l) service contracts with independent
contractors for any of the foregoing (including, but not limited to,
elevator, heating, air conditioning, ventilating, sprinkler system,
fire alarm and telecommunication equipment maintenance),
(m) management fees (whether or not paid to any
person, firm or corporation having an interest in or under common
ownership with Owner or any of the persons, firms or corporations
comprising Owner) in the amount of one ($1.00) dollar per rentable
square foot of the Building Area in the Base Escalation Year (as
hereinafter defined in Subsection I) which amount for management fees
shall increase in each Escalation Year subsequent to the Base
Escalation Year by the same percentage of increase as the percentage of
increase in the aggregate of all other Operating Expenses but shall in
no event exceed four (4%) percent of the gross rent received from all
tenants in the Building,
(n) legal fees and disbursements and other
expenses (excluding, however, legal fees and expenses incurred in
connection with any application or proceeding brought for reduction of
the assessed valuation of the Real Property or any part thereof),
(o) auditing fees,
(p) advertising and promotion expenses,
(q) all costs of compliance under the provisions
of any present or future Superior Lease other than the payment of
rental and impositions thereunder and increases in the basic rent under
such leases as a result of adjustments in such basic rent, and
(2) The cost and expense of the following shall be
excluded from the calculation of operating expenses:
(a) leasing commissions;
(b) executives' salaries above the grade of
building manager and superintendent;
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(c) capital improvements and replacements which
under generally accepted accounting principles and practice would be
classified as capital expenditures, except the cost and expense of any
improvement, alteration, replacement or installation which is either
(i) required by any Legal Requirement enacted after the date of this
Lease, or (ii) designed, in Owner's judgment, to result in savings or
reductions in Operating Expenses (such improvements, alterations,
replacements and installations are referred to as "Included
--------
Improvements"); the cost and expense of Included Improvements whenever
------------
made shall be included in Operating Expenses for any Escalation Year
subsequent to the Base Escalation Year to the extent of (x) the annual
amortization or depreciation of the cost and expense to Owner of such
Included Improvements, as amortized or depreciated on a straight line
basis over ten (10) years allocable to such Escalation Year plus (y) an
annual charge for interest upon the unamortized or undepreciated
portions of such cost and expense at the average prime rate (as defined
in Section 31.03) during the Escalation Year in question;
(d) any other item which under generally
accepted accounting principles and practice would not be regarded as an
operating, maintenance or management expense;
(e) any item for which Owner is compensated
through proceeds of insurance; and
(f) any specific compensation which Owner
receives from any tenant for services rendered to such tenant by Owner
above and beyond those services generally rendered by Owner to tenants
in the Building without specific compensation therefor.
(g) franchise or income taxes imposed upon
Owner;
(h) ground rent;
(i) financing costs including the payment of
principal and interest;
(j) depreciation on the Building and its
components (subject, however, to the provisions of this subsection
23.01H with respect to Included Improvements) and amortization and
interest payments under any mortgage;
(k) expenses in connection with services or
other benefits which are not provided to Tenant;
(l) expenses for services which are provided to
other tenants or occupants of the Building if such services are
services which are provided to Tenant and charged to Tenant directly;
(m) overhead and profit increment paid to Owner
or to subsidiaries or affiliates of Owner for goods and/or services in
the Building to the extent the same exceeds the costs of such goods
and/or services which would be rendered by unaffiliated third parties
on a competitive basis in comparable buildings;
(n) costs arising from Owner's charitable or
political contributions;
(o) costs for sculpture, paintings or other
objects of art;
52
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(p) the cost of any work or services rendered or
performed by Owner for the benefit of any other tenant in the Building
to the extent such work or services are in excess of those to be
afforded or rendered to Tenant under this Lease;
(q) attorney's fees and disbursements incurred
(i) in procuring tenants or in negotiating leases or renewing leases,
(ii) in connection with any mortgaging, financing, refinancing, sale,
or entering into or extending or modifying any ground or underlying
lease, (iii) in defending Owner's title to the Real Property, or (iv)
in prosecution of summary dispossess proceeding or holdover proceedings
or in defense of any landlord-tenant action;
(r) costs attributable to the negligence of
Owner;
(s) if Owner operates concessions such as
restaurants, parking facilities, health or other clubs, observatories
or other special services in the Building, costs incurred in connection
therewith;
(t) rent paid by Owner for office space
(including, but not limited to office space used for a management
office) and any other expenses related to such office space;
(u) dues and fees for trade and industry
associations and costs of their related activities to the extent such
dues, fees and costs exceed those customarily incurred by owners of
office buildings similarly situated;
(v) expenses for repairs and maintenance which
are covered by warranties;
(w) expenses allocable directly and solely to
the retail space of the Building;
(x) any accrued and unfunded pension or other
benefits of any personnel which are not paid within six (6) months
after required;
(y) the cost of any separate electric meter or
any survey Owner may provide to any of the tenants in the Building; and
(z) electric energy furnished directly by Owner
to Tenant or any other tenants in the Building.
I. The term "Base Operating Expenses" shall mean a sum equal to
-----------------------
the Operating Expenses for the calendar year 2000.
J. The term "Owner's Tax Statement" shall mean an instrument
---------------------
containing a computation of any increase in the Fixed Rent pursuant to the
provisions of Section 23.02 A. of this Article.
K. The term "Owner's Operating Expense Statement" shall mean an
-----------------------------------
instrument containing a computation of any increase in the Fixed Rent pursuant
to the provisions of Section 23.04 of this Article.
L. The term "Monthly Escalation Installment" shall mean a sum
------------------------------
equal to one-twelfth (1/12th) of the increase in the Fixed Rent payable pursuant
to the provisions of Subsection 23.04 A for the Escalation Year with respect to
which Owner has most recently rendered an Owner's Operating Expense Statement,
appropriately adjusted to reflect (i) in the event such Escalation Year is a
partial calendar year, the increase in the Fixed Rent which would have been
payable for such Escalation Year if it had been a full calendar year, and (ii)
the amount by which
53
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current Operating Expenses as reasonably estimated by Owner exceed Operating
Expenses as reflected in such Owner's Operating Expense Statement except that
such estimated excess shall not exceed an amount equal to five (5%) of the
Operating Expenses for the immediately preceding Escalation Year unless Owner
delivers reasonable evidence to Tenant that such excess is more than five (5%);
and (iii) any net credit balance to which Tenant may be entitled pursuant to the
provisions of Subsection 23.05 C.
M. The term "Monthly Escalation Installment Notice" shall mean
-------------------------------------
a notice given by Owner to Tenant which sets forth the current Monthly
Escalation Installment; such Notice may be contained in a regular monthly rent
bill, in an Owner's Operating Expense Statement, or otherwise, and may be given
from time to time, at Owner's election.
N. Owner and Tenant acknowledge that Owner may apply for a
certificate of eligibility from the Department of Finance of the City of New
York determining that Owner is eligible to apply for exemption from tax payments
for the Real Property pursuant to the provisions of Section 11-256 through 11-
267 (the "ICIP Program") of the Administrative Code of the City of New York and
------------
the regulations promulgated pursuant to the ICIP Program. Any such tax exemption
for the Real Property is referred to as "Tax Exemption" and the period of such
-------------
Tax Exemption is referred to as the "Tax Exemption Period". Owner agrees that
--------------------
Tenant shall not be required to (a) pay Taxes or charges which become due
because of the willful neglect or fraud by Owner in connection with the ICIP
Program or (b) otherwise relieve or indemnify Owner from any personal liability
arising under the ICIP Program, except where imposition of such Taxes, charges
or liability is occasioned by actions of Tenant in violation of this Lease.
Tenant agrees to report to Owner, as often as is necessary under such
regulations, the number of workers engaged in employment in the Demised
Premises, the nature of each worker's employment and the residency of each
worker and to provide access to the Demised Premises by employees and agents of
the Department of Finance of the City of New York at all reasonable times at the
request of Owner. Tenant represents to the Owner that, within the seven (7)
years immediately preceding the date of this Lease, Tenant has not been adjudged
by a court of competent jurisdiction to have been guilty of (x) an act, with
respect to a building, which is made a crime under the provisions of Article 150
of the Penal Law of the State of New York or any similar law of another state,
or (y) any act made a crime or violation by the provisions of Section 235 of the
Real Property Law of the State of New York, nor is any charge for a violation of
such laws presently pending against Tenant. Upon request of Owner, from time to
time, Tenant agrees to update said representation when required because of the
ICIP Program and regulations thereunder. Tenant further agrees to cooperate with
Owner in compliance with such ICIP Program and regulations to aid Owner in
obtaining and maintaining the Tax Exemption and, if requested by Owner, to post
a notice in a conspicuous place in the Demised Premises and to publish a notice
in a newspaper of general circulation in the City of New York, in such form as
shall be prescribed by the Department of Finance stating that persons having
information concerning any violation by Tenant of Section 235 of the Real
Property Law or any Section of Article 150 of the Penal Law or any similar law
of another jurisdiction may submit such information to the Department of Finance
to be considered in determining Owner's eligibility for benefits. Tenant
acknowledges that its obligations under the provisions of Subsection 23.02A may
be greater if Owner fails to obtain a Tax Exemption, and agrees that Owner shall
have no liability to Tenant nor shall Tenant be entitled to any abatement or
diminution of rent if Owner fails to obtain a Tax Exemption.
Section 23.02. Section 23.02. Taxes: A. If Taxes payable in any
-----
Tax Escalation Year shall be in such amount as shall constitute an increase
above Owner's Basic Tax Liability, the Fixed Rent for such Tax Escalation Year
shall be increased by a sum equal to Tenant's Proportionate Share of any such
increase in Taxes.
B. Unless the Commencement Date shall occur on a
July 1st, any increase in the Fixed Rent pursuant to the provisions of
Subsection A of this Section 23.02 for the Tax Escalation Year in which the
Commencement Date shall occur shall be apportioned in that percentage which the
number of days in the period from the Commencement Date to June 30th of such Tax
Escalation Year, both inclusive, bears to the total number of days in such Tax
Escalation Year. Unless the Demised Term shall expire on a June 30th, any
increase in the Fixed Rent pursuant to the provisions of said Subsection A for
the Tax Escalation Year in which the date of the expiration of the Demised Term
shall occur shall be apportioned in that percentage which the number of days in
the period from July 1st of such Tax Escalation Year to such date of expiration,
both inclusive, bears to the total number of days in such Tax Escalation Year.
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Section 23.03. A. Payment of Taxes: Owner shall render to
----------------
Tenant, in accordance with the provisions of Article 27, an Owner's Tax
Statement with respect to each Tax Escalation Year, either prior to or during
such Tax Escalation Year; upon request of Tenant, Owner shall deliver to Tenant
a copy of the tax bill with respect to the payment to be made by Tenant with
respect thereto if Owner has received same from the taxing authority. Owner's
failure to render an Owner's Tax Statement with respect to any Tax Escalation
Year shall not prejudice Owner's right to recover any sums due to Owner
hereunder with respect to such Tax Escalation Year, nor shall it deprive Tenant
of any credit to which it otherwise might be entitled for such Tax Escalation
Year pursuant to the provisions of subsection C of this Section 23.03. The
obligations of Owner and Tenant under the provisions of Section 23.02 and this
Section 23.03 with respect to any increase in the Fixed Rent or any payment or
credit to which Tenant may be entitled shall survive the expiration or any
sooner termination of the Demised Term. Tenant acknowledges that under the
present law Taxes are payable by Owner (i) with respect to a fiscal year
commencing July 1st and ending on the following June 30th and (ii) in two (2)
installments, in advance, the first of which is payable on July 1st and the
second and final payment of which is payable on the following January 1st.
Within thirty (30) days next following rendition of the first Owner's Tax
Statement which shows an increase in the Fixed Rent for any Tax Escalation Year,
but not earlier than thirty (30) days before the installment of Taxes is due,
Tenant shall pay to Owner a sum equal to one-half (1/2) of the amount of the
increase shown upon such Owner's Tax Statement for such Tax Escalation Year
(subject to any apportionment pursuant to the provisions of Subsection B of
Section 23.02) and, subsequently, provided Owner shall have rendered to Tenant
another Owner's Tax Statement or invoice with respect to the installment in
question, Tenant shall pay to Owner not later than the later of (x) thirty (30)
days prior to the date on which the installment of Taxes is required to be paid
by Owner to the taxing authority and (y) thirty (30) days after the rendition of
an Owner's Tax Statement or invoice, as the case may be, a sum equal to one-half
(1/2) of Tenant's Proportionate Share of the increase in Taxes payable with
respect to such Tax Escalation Year as shown on such Owner's Tax Statement or
invoice, as the case may be.
Tenant further acknowledges that it is the purpose and
intent of this Section 23.03 to provide Owner with Tenant's Proportionate Share
of the increase in the Taxes pursuant to the provisions of this subsection A at
least thirty (30) days prior to the time such installment of Taxes is required
to be paid by Owner to the taxing authority without penalty or interest.
Accordingly, Tenant agrees that if the number of such installments, and/or the
time for payment thereof, and/or the fiscal year used for purposes of Taxes, is
changed, then, (a) at the time described in clause (b) below, Tenant shall pay
to Owner the amount which shall provide Owner with Tenant's Proportionate Share
of the increase in the Taxes pursuant to the provisions of Section 23.02.A
applicable to the revised installment of Taxes then required to be paid by Owner
to the taxing authority and (b) this Article shall be appropriately adjusted to
reflect such change and the time for payment by Tenant to Owner of Tenant's
Proportionate Share of any increase in Taxes as provided in this Article shall
be appropriately revised so that Owner shall always be provided with Tenant's
Proportionate Share of the increase in the Taxes no later than the later of (xx)
thirty (30) days prior to the date the installment of Taxes is required to be
paid by Owner and (yy) thirty (30) days after the rendition of an Owner's Tax
Statement therefor. Notwithstanding the foregoing provisions of this subsection
A to the contrary, in the event the holder of any Mortgage and/or any Superior
Lease shall require Owner to make monthly deposits on account of real estate
taxes, then this Article shall be appropriately adjusted to reflect the
requirement that Tenant make monthly deposits on account of real estate taxes to
Owner so that Owner shall always be provided with one-twelfth (1/12th) of
Tenant's Proportionate Share of such increase in the Taxes with respect to any
Tax Escalation Year thirty (30) days prior to the payment by Owner of such
monthly deposits on account of real estate taxes, provided that no payment need
be made by Tenant earlier than thirty (30) days following Owner's invoice
therefor, provided further, however, Owner shall pay to Tenant interest at the
prime rate on the amount of such monthly deposit from the date Tenant makes such
deposit to the next occurring date upon which an installment of Taxes is
required to be paid to the taxing authority.
B. If, as a result of any application or
proceeding brought by or on behalf of Owner, Owner's Basic Tax Liability shall
be decreased, Owner's Tax Statement next following such decrease shall include
any adjustment of the Fixed Rent for all prior Tax Escalation Years reflecting a
debit to Tenant equal to the amount by which (a) the aggregate Tenant's Tax
Payments payable with respect to all such prior Tax Escalation Years calculated
after taking into account such reduction of Owner's Basic Tax Liability shall
exceed (b) the aggregate Tenant's Tax Payments actually paid by Tenant with
respect to all such prior Tax Escalation Years. If, as a result of any
application or proceeding brought by or on behalf of Owner for reduction of the
assessed valuation of the Real Property or for Taxes for any fiscal tax year
subsequent to the fiscal tax year commencing July 1st, 2000, and expiring
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June 30th, 2001, there shall be a decrease in Taxes for any Tax Escalation Year
with respect to which Owner shall have previously rendered an Owner's Tax
Statement, Owner's Tax Statement next following such decrease shall include an
adjustment (inclusive of Tenant's Proportionate Share of any interest received
by Owner from the taxing authority allocable to Tenant's Tax Payment and that
portion of the Tax Escalation Year falling within the Demised Term) of the
Tenant's Tax Payment for such Tax Escalation Year reflecting a credit to Tenant
equal to the amount by which (i) the Tenant's Tax Payment actually paid by
Tenant with respect to such Tax Escalation Year shall exceed (ii) the Tenant's
Tax Payment payable with respect to such Tax Escalation Year calculated after
taking into account such reduction of the assessed valuation or reduction of
Taxes and any such credit shall be credited against the next accruing monthly
installment of Fixed Rent next accruing after such decrease in Taxes is received
by Owner or credited against future taxes. If such refund of Taxes is received
by Owner after the expiration or earlier termination of this Lease, or if during
the Demised Term such credit owed by Owner to Tenant is greater than Tenant's
next following payment of Fixed Rent due, Owner shall pay Tenant the amount of
the refund owed to Tenant, together with the amount of interest thereon to which
Tenant is entitled as hereinabove provided, within thirty (30) days after Owner
receives such refund, which obligation shall survive such expiration or earlier
termination of this Lease.
C. Owner, upon timely requests of tenants occupying at
least sixty-five (65%) percent of the total rentable area of the Building, will,
from time to time, make appropriate protest of any proposed real estate tax
assessment for any fiscal tax year subsequent to the fiscal tax year commencing
July 1, 2000 and ending June 30, 2001, or will institute proceedings seeking to
reduce any such assessment and use reasonable efforts to effect a reduction of
such proposed assessment, provided, however, that (i) as a condition of Owner's
obligation to make such protest or institute such proceedings, the tenants
requesting same shall agree, in writing, to bear the entire cost of such protest
or proceedings, including reasonable counsel fees, to the extent that such cost
is not recoverable by Owner from other tenants of the Building pursuant to the
provisions of the respective leases of such tenants (in the event of any
question as to whether any such cost is so recoverable from other tenants, the
certification of an independent certified public accountant employed by owner
shall be deemed conclusive with respect to such question) and to pay such
portion of such cost to Owner, upon demand, as additional rent under the
respective leases of such tenants, and (ii) the method or manner or conducting
such protest or proceedings, including this selection of counsel, shall be
solely within the judgment of Owner, and (iii) Owner may cancel, discontinue or
settle such protest or proceeding if, in Owner's judgment, such cancellation,
discontinuation or settlement is deemed advisable.
Section 23.04. Operating Expenses: A. If Operating Expenses in
------------------
any Escalation Year shall be in such an amount as shall constitute an increase
above Base Operating Expenses, the Fixed Rent for such Escalation Year shall be
increased by a sum equal to Tenant's Proportionate Share of any such increase.
In the event that Base Operating Expenses shall be in excess of Operating
Expenses in any Escalation Year, in no event shall Tenant be entitled to any
such excess and the Fixed Rent shall not be reduced in any way.
B. Unless the Commencement Date shall occur on a
January 1st, any increase in the Fixed Rent pursuant to the provisions of
Subsection A of this Section 23.04 for the Escalation Year in which the
Commencement Date shall occur shall be apportioned in that percentage which the
number of days in the period from the Commencement Date to December 31st of such
Escalation Year, both dates inclusive, bears to the total number of days in such
Escalation Year. Unless the Demised Term shall expire on December 31st any
increase in the Fixed Rent pursuant to the provisions of Subsection A of this
Section 23.04 for the Escalation Year in which the date of the expiration of the
Demised Term shall occur shall be apportioned in that percentage which the
number of days in the period from January 1st of such Escalation Year to such
date of expiration, both dates inclusive, bears to the total number of days in
such Escalation Year.
C. In the determination of any increase in the
Fixed Rent pursuant to the foregoing provisions of this Section 23.04, if the
Building shall not have been fully occupied during any Escalation Year including
the calendar year 2000, Operating Expenses for such Escalation Year shall be
equitably adjusted (by including such additional expenses as Owner would have
incurred) to the extent, if any, required to reflect full occupancy.
Section 23.05. Space Calculation and Payment of Operating
------------------------------------------
Expenses: A. Owner shall render to Tenant, either in accordance with the
--------
provisions of Article 27 or by personal delivery at the Demised Premises, an
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Owner's Operating Expense Statement with respect to each Escalation Year on or
before the next succeeding October 1st. Owner's failure to render an Owner's
Operating Expense Statement with respect to any Escalation Year shall not
prejudice Owner's right to recover any sums due to Owner hereunder with respect
to such Escalation Year.
B. Within fifteen (15) days next following
rendition of the first Owner's Operating Expense Statement which shows an
increase in the Fixed Rent for any Escalation Year, Tenant shall pay to Owner
the entire amount of such increase. In order to provide for current payments on
account of future potential increases in the Fixed Rent which may be payable by
Tenant pursuant to the provisions of Subsection 23.04.A, Tenant shall also pay
to Owner at such time, provided Owner has given to Tenant a Monthly Escalation
Installment Notice, a sum equal to the product of (i) the Monthly Escalation
Installment set forth in such Notice multiplied by (ii) the number of months or
partial months which shall have elapsed between January 1st of the Escalation
Year in which such payment is made and the date of such payment, less any
amounts theretofore paid by Tenant to Owner on account of increases in the Fixed
Rent for such Escalation Year pursuant to the provisions of the penultimate
sentence of this Subsection 23.05.B; thereafter Tenant shall make payment of a
Monthly Escalation Installment throughout each month of the Demised Term.
Monthly Escalation Installments shall be added to and payable as part of each
monthly installment of Fixed Rent. Notwithstanding anything to the contrary
contained in the foregoing provisions of this Article, prior to the rendition of
the first Owner's Operating Expense Statement which shows an increase in the
Fixed Rent for any Escalation Year, Owner may render to Tenant a pro-forma
Owner's Operating Expense Statement containing a bona fide estimate of the
increase in the Fixed Rent for the Escalation Year in which the Commencement
Date shall occur and/or the subsequent Escalation Year. Following the rendition
of such pro-forma Owner's Operating Expense Statement, Tenant shall pay to Owner
a sum equal to one twelfth (1/12th) of the estimated increase in the Fixed Rent
shown thereon for such Escalation Year or Years multiplied by the number of
months which may have elapsed between the Commencement Date and the month in
which such payment is made and thereafter pay to Owner, on the first day of each
month of the Demised Term (until the rendition by Owner of the first Owner's
Operating Expense Statement) a sum equal to one twelfth (1/12th) of the increase
in the Fixed Rent shown on such pro-forma Owner's Operating Expense Statement.
Any sums paid pursuant to the provisions of the immediately preceding sentence
shall be credited against the sums required to be paid by Tenant to Owner
pursuant to the Owner's Operating Expense Statement for the first Escalation
Year for which there is an increase in the Fixed Rent pursuant to the provisions
of Subsection A.
C. Following rendition of the first Owner's
Operating Expense Statement and each subsequent Owner's Operating Expense
Statement a reconciliation shall be made as follows: Tenant shall be debited
with any increase in the Fixed Rent shown on such Owner's Operating Expense
Statement and credited with the aggregate amount, if any, paid by Tenant in
accordance with the provisions of Subsection B of this Section on account of
future increases in the Fixed Rent pursuant to Subsection 23.04 A. which has not
previously been credited against increases in the Fixed Rent shown on Owner's
Operating Expense Statements. Tenant shall pay any net debit balance to Owner
within fifteen (15) days next following rendition by Owner, either in accordance
with the provisions of Article 27 or by personal delivery at the Demised
Premises of an invoice for such net debit balance; any net credit balance shall
be applied as an adjustment against the next accruing Monthly Escalation
Installment as provided in Subsection J of Section 23.01.
Section 23.06. Dispute Resolution: A. In the event of any dispute
------------------
between Owner and Tenant arising out of the application of the Operating Expense
provisions of this Article, such dispute shall be determined by arbitration in
New York City in accordance with the provisions of Article 36. Notwithstanding
any such dispute and submission to arbitration, or any dispute with respect to
the Tax Escalation provisions of this Article (which dispute shall not be
subject to arbitration but which can only be prosecuted by the institution of
legal proceedings by Tenant), any increase in the Fixed Rent shown upon any
Owner's Operating Expense Statement or any Monthly Escalation Installment Notice
or any Owner's Tax Statement shall be payable by Tenant within the time
limitation set forth in this Article. If the determination in such arbitration
or legal proceedings shall be adverse to Owner, any amount paid by Tenant to
Owner in excess of the amount determined to be properly payable shall be
credited against the next accruing installments of Fixed Rent due under this
Lease. However, if there are no such installments, such amounts shall be paid by
Owner to Tenant within ten (10) days following such determination.
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B. In the event Tenant disagrees with any
computation or other matter con tained in any Owner's Operating Expense
Statement including the Base Operating Expenses as shown in the first Operating
Expense Statement rendered by Owner to Tenant, Tenant shall have the right to
give notice to Owner within ninety (90) days next following rendition of such
Statement setting forth the particulars of such disagreement. If the matter is
not resolved within thirty (30) days next following the giving of such notice by
Tenant, it shall be deemed a dispute which either party may submit to
arbitration pursuant to the provisions of Subsection A of this Section. If (i)
Tenant does not give a timely notice to Owner in accordance with the foregoing
provisions of this Subsection disagreeing with any computation or other matter
contained in any Owner's Operating Expense Statement and setting forth the
particulars of such disagreement, or (ii) if any such timely notice shall have
been given by Tenant, the matter shall not have been resolved and neither party
shall have submitted the dispute to arbitration within thirty (30) days next
following the giving of such notice by Tenant, Tenant shall be deemed
conclusively to have accepted such Owner's Operating Expense Statement and shall
have no further right to dispute the same.
C. (1) Tenant or an accounting firm or a
subsidiary of any accounting firm, including without limitation, Lease Audit and
Analysis Services (provided same are certified public accountants) in each case
at Tenant's expense, shall have the right to examine those portions of Owner's
records which are reasonably required to verify the accuracy of any amounts
shown on any Owner's Operating Expense Statement provided Tenant shall notify
Owner of its desire to so examine such records within ninety (90) days next
following rendition of such Owner's Operating Expense Statement. Owner shall
maintain such records for a period of three (3) years following the expiration
of the Escalation Year to which they relate. Upon Tenant's timely request, Owner
shall make such records available and any such examination shall be conducted at
the office of Owner's accountants or at such other reasonable place designated
by Owner during normal office hours.
(2) Tenant acknowledges and agrees that not
more than three (3) of its employees or three (3) persons employed by such
auditors shall be entitled to entry to the offices of Owner at any one time for
the purposes of such review and inspection. Tenant hereby recognizes the
confidential, privileged and proprietary nature of such records and the
information and data contained therein, as well as any compromise, settlement or
adjustment reached between Owner and Tenant relating to the results of such
examination, and Tenant covenants and agrees for itself, and its employees,
agents and representatives (including, but not limited to, such auditors, and
any attorneys or consultants retained by Tenant as hereinafter provided), that
such books, records, information, data, compromise, settlement and adjustment
will be held in the strictest confidence and not be divulged, disclosed or
revealed to any other person except (x) to the extent required by law, court
order or directive of any Governmental Authority or (y) to such auditors or any
attorneys retained by Tenant or consultants retained by Tenant in connection
with any action or proceeding between Owner and Tenant as to Operating Expenses
or Owner's Operating Expense Statement and no examination of any such records
shall be permitted unless and until such auditors, attorneys and consultants
affirmatively agree and consent to be bound by the provisions of this Section
23.06C.
(3) Tenant agrees that this Section 23.06C is of
material importance to Owner and that any violation thereof shall result in
immediate harm to Owner and Owner shall have all rights allowed by law or equity
if Tenant, its employees, agents, and representatives (including, but not
limited to, such auditors, attorneys or consultants) violate the terms of this
Section 23.06C, including, but not limited to, the right to terminate Tenant's
right to audit Owner's records in the future pursuant to this Section 23.06C,
and Tenant shall indemnify and hold Owner harmless of and from all loss, cost,
damage, liability and expense (including, but not limited to reasonable counsel
fees and disbursements) arising from a breach of the foregoing obligations of
Tenant or any of its employees, agents and representatives, (including but not
limited to, such auditors, attorneys or consultants). This obligation of Tenant
and its employees, agents and representatives (including, but not limited to,
any such auditors, attorneys or consultants) shall survive the expiration or
sooner term of the Demised Term.
Section 23.07. Collection of Increases in Fixed Rent: The
-------------------------------------
obligations of Owner and Tenant under the provisions of this Article with
respect to any increase in the Fixed Rent, or any credit to which Tenant may be
entitled, shall survive the expiration or any sooner termination of the Demised
Term. All sums payable by Tenant under this Article shall be collectible by
Owner in the same manner as Fixed Rent.
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ARTICLE 24
NO WAIVER
---------
Section 24.01. Owner's Termination Not Prevented: Neither any
---------------------------------
option granted to Tenant in this Lease or in any collateral instrument to renew
or extend the Demised Term, nor the exercise of any such option by Tenant, shall
prevent Owner from exercising any option or right granted or reserved to Owner
in this Lease or in any collateral instrument or which Owner may have by virtue
of any law, to terminate this Lease and the Demised Term or any renewal or
extension of the Demised Term either during the original Demised Term or during
the renewed or extended term. Any termination of this Lease and the Demised Term
shall serve to terminate any such renewal or extension of the Demised Term and
any right of Tenant to any such renewal or extension, whether or not Tenant
shall have exercised any such option to renew or extend the Demised Term. Any
such option or right on the part of Owner to terminate this Lease shall continue
during any extension or renewal of the Demised Term. No option granted to Tenant
to renew or extend the Demised Term shall be deemed to give Tenant any further
option to renew or extend.
Section 24.02. No Termination by Tenant/No Waiver: No act or
----------------------------------
thing done by Owner or Owner's agents during the Demised Term shall constitute a
valid acceptance of a surrender of the Demised Premises or any remaining portion
of the Demised Term except a written instrument accepting such surrender,
executed by Owner and Tenant. No employee of Owner or of Owner's agents shall
have any authority to accept the keys of the Demised Premises prior to the
termination of this Lease and the Demised Term, and the delivery of such keys to
any such employee shall not operate as a termination of this Lease or a
surrender of the Demised Premises; however, if Tenant desires to have Owner
sublet the Demised Premises for Tenant's account, Owner or Owner's agents are
authorized to receive said keys for such purposes without releasing Tenant from
any of its obligations under this Lease, and Tenant hereby relieves Owner of any
liability for loss of, or damage to, any of Tenant's property or other effects
in connection with such subletting. The failure by Owner to seek redress for
breach or violation of, or to insist upon the strict performance of, any term,
covenant or condition of this Lease on Tenant's part to be observed or
performed, shall not prevent a subsequent act or omission which would have
originally constituted a breach or violation of any such term, covenant or
condition from having all the force and effect of an original breach or
violation. The receipt by Owner of rent with knowledge of the breach or
violation by Tenant of any term, covenant or condition of this Lease on Tenant's
part to be observed or performed shall not be deemed a waiver of such breach or
violation. Owner's failure to enforce any Building Rule against Tenant or
against any other tenant or occupant of the Building shall not be deemed a
waiver of any such Building Rule. No provision of this Lease shall be deemed to
have been waived by Owner unless such waiver shall be set forth in a written
instrument executed by Owner. No payment by Tenant or receipt by Owner of a
lesser amount than the aggregate of all Fixed Rent and additional rent then due
under this Lease shall be deemed to be other than on account of the first
accruing of all such items of Fixed Rent and additional rent then due, no
endorsement or statement on any check and no letter accompanying any check or
other rent payment in any such lesser amount and no acceptance of any such check
or other such payment by Owner shall constitute an accord and satisfaction, and
Owner may accept any such check or payment without prejudice to Owner's right to
recover the balance of such rent or to pur sue any other legal remedy.
ARTICLE 25
MUTUAL WAIVER OF TRIAL BY JURY
------------------------------
Section 25.01. Owner and Tenant hereby waive trial by jury in any
action, proceeding or counterclaim brought by Owner or Tenant against the other
on any matter whatsoever arising out of or in any way connected with this Lease,
the relationship of landlord and tenant, the use or occupancy of the Demised
Premises by Tenant or any person claiming through or under Tenant, any claim of
injury or damage, and any emergency or other statutory remedy; however, the
foregoing waiver shall not apply to any action for personal injury or property
damage. The provisions of the foregoing sentence shall survive the expiration or
any sooner termination of the Demised Term. If Owner commences any summary
proceeding, or any other proceeding of like import, Tenant agrees: (i) not to
interpose any counterclaim of whatever nature or description in any such summary
proceeding, or any other proceeding of like import, unless failure to interpose
such counterclaim would preclude Tenant from asserting such claim in a
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separate action or proceeding; and (ii) not to seek to remove to another court
or jurisdiction or consolidate any such summary proceeding, or other proceeding
of like import, with any action or proceeding which may have been, or will be,
brought by Tenant. In the event that Tenant shall breach any of its obligations
set forth in the immediately preceding sentence, Tenant agrees (a) to pay all of
Owner's reasonable attorneys' fees and disbursements in connection with Owner's
enforcement of such obligations of Tenant and (b) in all events, to pay all
accrued, present and future Fixed Rent and increases therein and additional rent
payable pursuant to the provisions of this Lease.
ARTICLE 26
INABILITY TO PERFORM
--------------------
Section 26.01. If, by reason of strikes or other labor disputes,
fire or other casualty (or reasonable delays in adjustment of insurance),
accidents, any Legal Requirements, any orders of any Governmental Authority or
any other cause beyond Owner's reasonable control, whether or not such other
cause shall be similar in nature to those hereinbefore enumerated, Owner is
unable to furnish or is delayed in furnishing any utility or service required to
be furnished by Owner under the provisions of Article 29 or any other Article of
this Lease or any collateral instrument, or is unable to perform or make or is
delayed in performing or making any installations, dec orations, repairs,
alterations, additions or improvements, whether or not required to be performed
or made under this Lease or under any collateral instrument, or is unable to
fulfill or is delayed in fulfilling any of Owner's other obligations under this
Lease or any collateral instrument, no such inability or delay shall constitute
an actual or constructive eviction, in whole or in part, or entitle Tenant to
any abatement or diminution of rent, or relieve Tenant from any of its
obligations under this Lease, or impose any liability upon Owner or its agents
by reason of inconvenience or annoyance to Tenant, or injury to or interruption
of Tenant's business, or otherwise. Owner agrees to employ reasonable diligence
to eliminate the cause of any inability or delay referred to in this Section,
including, where necessary, the employment of labor at overtime or other premium
pay rates; it is understood and agreed, however, that the foregoing provisions
of this sentence shall not apply in the event of any strike or other labor
dispute.
ARTICLE 27
NOTICES
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Section 27.01. Except as otherwise expressly provided in this Lease,
any bills, statements, notices, demands, requests or other communications given
or required to be given under this Lease shall be effective only if rendered or
given in writing, sent by registered or certified mail (return receipt requested
optional), or by nationally recognized overnight courier addressed as follows:
(a) To Tenant (i) at Tenant's address set forth in
---------
this Lease if mailed prior to Tenant's taking possession of the Demised
Premises, or (ii) at the Building if mailed subsequent to Tenant's taking
possession of the Demised Premises, or (iii) at any place where Tenant or any
agent or officer of Tenant may be found if mailed subsequent to Tenant's
vacating, deserting, abandoning or surrendering the Demised Premises, and, with
the exception of bills and statements a copy to Skadden Arps, Slate, Meagher &
Flom, 4 Times Square, New York, New York 10036, Attention: Richard Kalikow, Esq;
or
(b) To Owner at Owner's address set forth in this
--------
Lease, with a copy to Goldfarb & Fleece, 345 Park Avenue, New York, New York
10154, Attention: Partner-in-Charge, Rudin Management, or
(c) addressed to such other address as either Owner
or Tenant may designate as its new address for such purpose by notice given to
the other in accordance with the provisions of this Section. Any such bill,
statement, notice, demand, request or other communication shall be deemed to
have been rendered or given on the date when it shall have been mailed as
provided in this Section.
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Nothing contained in this Section 27.01 shall preclude, limit or modify Owner's
service of any notice, statement, demand or other communication in the manner
required by law, including, but not limited to, any demand for rent under
Article 7 of the New York Real Property Actions and Proceedings Law or any
successor laws of like import.
ARTICLE 28
PARTNERSHIP TENANT
------------------
Section 28.01. If Tenant is a partnership or professional
corporation (or is comprised of two (2) or more persons, individually and as
co-partners of a partnership or shareholders of a professional corporation (or
if Tenant's interest in this Lease shall be assigned to a partnership or
professional corporation (or to two (2) or more persons, individually and as
co-partners of a partnership or shareholders of a professional corporation)
pursuant to Article 11 (any such partnership, professional corporation, and such
persons are referred to in this Section as "Partnership Tenant"), the following
------------------
provisions of this Section shall apply to such Partnership Tenant: (i) the
liability of each of the persons comprising Partnership Tenant shall be joint
and several, individually and as a partner or shareholder, with respect to all
obligations of the Tenant under this Lease whether or not such obligations arose
prior to, during, or after any period when any party comprising Partnership
Tenant was a shareholder of Partnership Tenant, and (ii) each of the persons
comprising Partnership Tenant, whether or not such person shall be one of the
persons comprising Tenant at the time in question, hereby consents in advance
to, and agrees to be bound by, any written instrument which may hereafter be
executed, changing, modifying or discharging this Lease, in whole or in part, or
surrendering all or any part of the Demised Premises to Owner, and by any
notices, demands, requests or other communications which may hereafter be given
by Partnership Tenant or by any of the persons comprising Partnership Tenant,
and (iii) any bills, statements, notices, demands, requests or other
communications given or rendered to Partnership Tenant or to any of the persons
comprising Partnership Tenant shall be deemed given or rendered to Partnership
Tenant and to all such persons and shall be binding upon Partnership Tenant and
all such persons, and (iv) if Partnership Tenant shall admit new partners or
shareholders, all of such new partners or shareholders, as the case may be,
shall, by their admission to Partnership Tenant, be deemed to have assumed
performance of all of the terms, covenants and conditions of this Lease on
Tenant's part to be observed and performed, and shall be liable for such
performance, together with all other parties, jointly or severally, individually
and as a partner or shareholder, whether or not the obligation to comply with
such terms, covenants or conditions arose prior to, during or after any period
when any party comprising Partnership Tenant was a member or shareholder of
Partnership Tenant and (v) Partnership Tenant shall give prompt notice to Owner
of the admission of any such new partners, or shareholders, as the case may be,
and, upon demand of Owner, shall cause each such new partner or shareholder to
execute and deliver to Owner an agreement, in form reasonably satisfactory to
Owner, wherein each such new partner or shareholder shall so assume performance
of all of the terms, covenants and conditions of this Lease on Tenant's part to
be observed and performed whether or not the obligation to comply with such
terms, covenants or conditions arose prior to, during or after any period when
any party comprising Partnership Tenant was a shareholder of Partnership Tenant
(but neither Owner's failure to request any such agreement nor the failure of
any such new partner or shareholder to execute or deliver any such agreement to
Owner shall vitiate the provisions of subdivision (iv) or any other provision of
this Section).
ARTICLE 29
UTILITIES AND SERVICES
----------------------
Section 29.01. Elevators: During the Demised Term, Owner, at
---------
Owner's expense, shall furnish necessary passenger elevator facilities on
business days (as defined in Section 31.01) from 8:00 A.M. to 6:00 P.M. and on
Saturdays from 8:00 A.M. to 1:00 P.M. and shall have a passenger elevator
subject to call at all other times. Tenant shall be entitled to the non-
exclusive use of the freight elevator in common with other tenants and occupants
of the Building from 8:00 A.M. to 6:00 P.M. on business days, subject to such
reasonable rules as Owner may adopt for the use of the freight elevator. At any
time or times all or any of the elevators in the Building may, at Owner's
option, be automatic elevators, and Owner shall not be required to furnish any
operator service for automatic elevators. If Owner shall, at any time, elect to
furnish operator service for any automatic elevators, Owner shall have
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the right to discontinue furnishing such service with the same effect as if
Owner had never elected to furnish such service. Subject to the provisions of
this Lease, during the Demised Term (i) Owner shall maintain at least the same
quality of elevator service to the Demised Premises as is being provided as of
the date of this Lease and (ii) Owner agrees that the thirteenth (13/th/) floor
of the Building shall remain a "cross over" floor for the Building.
Section 29.02. Heating, Ventilating and Air Conditioning: During
-----------------------------------------
the Demised Term, Owner, at Owner's expense, shall furnish and distribute to the
Demised Premises through the Building heating, ventilating and air conditioning
(referred to as "HVAC") system, when required for the comfortable occupancy of
----
the Demised Premises, heated, cooled and outside air, at reasonable
temperatures, pressures and degrees of humidity and in reasonable volumes and
velocities on a year-round basis, on business days from 7:00 A.M. to 7:00 P.M.
and on Saturdays from 7:00 A.M. to 2:00 P.M. Tenant understands, however, that
the equipment which will be employed in distributing cooled and outside air will
be connected to Tenant's electric meter and Tenant shall be responsible for
payment of all electricity consumed by such equipment. Notwithstanding the
foregoing provisions of this Section, Owner shall not be responsible if the
normal operation of the Building HVAC system shall fail to provide conditioned
air at reasonable temperatures, pressures or degrees of humidity or in
reasonable volumes or velocities in any portions of the Demised Premises (a)
which, by reason of any machinery or equipment installed by or on behalf of
Tenant or any person claiming through or under Tenant, shall have an electrical
load in excess of three and one-half (3 1/2) demand watts per square foot of
usable area for all purposes (including lighting and power), or which shall have
a human occupancy factor in excess of one person per 100 square feet of usable
area (the average electrical load and human occupancy factors for which the
Building HVAC system is designed) or (b) because of any rearrangement of
partitioning or other Alterations made or performed by or on behalf of Tenant or
any person claiming through or under Tenant. Whenever said HVAC system is in
operation, Tenant agrees to cause all the windows in the Demised Premises to be
kept closed and to cause the venetian blinds in the Demised Premises to be kept
closed if necessary because of the position of the sun. Tenant agrees to cause
all the windows in the Demised Premises to be closed whenever the Demised
Premises are not occupied. Tenant shall cooperate fully with Owner at all times
and abide by all regulations and requirements which Owner may reasonably
prescribe for the proper functioning and protection of the HVAC system. In
addition to any and all other rights and remedies which Owner may invoke for a
violation or breach of any of the foregoing provisions of this Section, Owner
may discontinue furnishing services under this Section during the period of such
violation or breach, and such discontinuance shall not constitute an actual or
constructive eviction, in whole or in part, or entitle Tenant to any abatement
or diminution of rent, or relieve Tenant from any of its obligations under this
Lease, or impose any liability upon Owner, or its agents, by reason of
inconvenience or annoyance to Tenant, or injury to or interruption of Tenant's
business, or otherwise.
Section 29.03. Cleaning: A. During the Demised Term, and
--------
provided Tenant shall keep the Demised Premises in order, Owner, at Owner's
expense, shall cause the office areas of the Demised Premises other than the
Basement Space to be cleaned substantially in accordance with the standards set
forth in Schedule B, all of the terms, covenants and conditions of which are
incorporated in this Lease by reference and shall be deemed a part of this
Lease, as though fully set forth in the body of this Lease and shall cause
Tenant's ordinary office waste paper refuse to be removed. Tenant shall
cooperate with any waste and garbage recycling program of the Building and shall
comply with all reasonable rules and regulations of Owner with respect thereto.
Tenant acknowledges that Owner's obligation to cause the office areas of the
Demised Premises to be cleaned excludes any portion of the Demised Premises not
used as office areas (e.g., storage, mail and computer areas, and areas used for
the storage, preparation, service or consumption of food or beverages). Tenant
shall pay Owner at Building standard rates (which rates, in the event that a
company affiliated with Owner provides such services, shall be competitive with
such rates for Class A office buildings in the mid-town Manhattan vicinity) or,
if there are no such rates, at reasonable rates, for the removal of any of
Tenant's refuse or rubbish, other than ordinary office waste paper refuse, from
the Building, and Tenant, at Tenant's expense, shall cause all portions of the
Demised Premises used for the storage, preparation, service or consumption of
food or beverages to be cleaned daily in a manner satisfactory to Owner, and to
be exterminated against infestation by vermin, roaches or rodents regularly and,
in addition, whenever there shall be evidence of any infestation.
B. Tenant acknowledges and is aware that the
cleaning services required to be furnished by Owner pursuant to this Section may
be furnished by a contractor or contractors employed by Owner and agrees that
Owner shall not be deemed in default of any of its obligations under this
Section 29.03 unless such
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default shall continue for an unreasonable period of time after notice from
Tenant to Owner setting forth the specific nature of such default. In the event
that Tenant is dissatisfied with the cleaning services furnished by Owner
pursuant to the provisions of this Section, Owner agrees to meet with Tenant
and, if necessary, representatives of Owner's cleaning contractor to attempt to
resolve the causes of Tenant's dissatisfaction. In the event that the parties
are unable to resolve the causes of Tenant's dissatisfaction, Owner agrees, upon
request of Tenant, to solicit bids from new cleaning services and award the
Building's cleaning contract to a new cleaning service reasonably acceptable to
both Owner and Tenant. In no event, however, shall Owner be required to change
the Building's cleaning service more than once in any two (2) year period by
reason of the provisions of the previous sentence.
C. Notwithstanding the provisions of Subsection
A of this Section, Tenant shall have the option to contract independently for
the removal of such other refuse and rubbish and for office cleaning services in
addition to those furnished by Owner. In the event Tenant exercises such option,
the removal of such other refuse and rubbish and the furnishing of office
cleaning services to Tenant by persons other than Owner and its contractors
shall be performed in accordance with such regulations and requirements as, in
Owner's reasonable judgment, are necessary for the proper operation of the
Building, and Tenant agrees that Tenant will not permit any person to enter the
Demised Premises or the Building for such purposes, or for the purpose of
providing extermination services required to be performed by Tenant pursuant to
Subsection A of this Section, other than persons first approved by Owner, such
approval not unreasonably to be withheld or delayed.
Section 29.04. Electricity: A. Tenant shall make arrangements
-----------
to supply all electricity in the Demised Premises, including, but not limited
to, electricity to serve the air conditioning and ventilating equipment
installed in the Demised Premises by contracting directly with the public
utility corporation furnishing electricity to the Building and shall pay said
utility corporation for all current consumed in or about the Demised Premises.
B. If either the quantity or character of
electrical service is changed by the public utility corporation supplying
electrical service to the Building or is no longer available or suitable for
Tenant's requirements, no such change, unavailability or unsuitability shall
constitute an actual or constructive eviction, in whole or in part, or entitle
Tenant to any abatement or diminution or rent, or relieve Tenant from any of its
obligations under this Lease, or impose any liability upon Owner, or its agents,
by reason of inconvenience or annoyance to Tenant, or injury to or interruption
of Tenant's business or otherwise.
C. Owner represents that the electrical feeder
or riser capacity serving the Demised Premises on the Commencement Date shall be
adequate to serve the lighting fixtures and electrical receptacles and HVAC
equipment installed in the Demised Premises on the Commencement Date. Owner
shall provide an average of six (6) watts per usable square foot of electrical
energy demand load in the Demised Premises throughout the Demised Term, other
than during any period it is prohibited from doing so by Legal Requirements
(including, but not limited to, the New York Energy Construction Code), in which
event the reference to "six (6)" set forth herein shall during such period be
decreased to a maximum average number of watts per usable square foot which is
permitted by Legal Requirements. Any additional feeders or risers to supply
Tenant's additional electrical requirements, and all other equipment proper and
necessary in connection with such feeders or risers, shall be installed by Owner
upon Tenant's request, at the sole cost and expense of Tenant, provided that, in
Owner's reasonable judgment, such additional feeders or risers are necessary and
are permissible under applicable laws and insurance regulations and the
installation of such feeders or risers will not cause permanent damage or injury
to the Building or the Demised Premises or cause or create a dangerous or
hazardous condition or entail excessive or unreasonable alterations or repairs
to, interfere with, or disturb, other tenants or occupants of the Building.
Tenant covenants that at no time shall the use of electrical energy in the
Demised Premises exceed the capacity of the existing feeders or wiring
installations then serving the Demised Premises.
D. Notwithstanding anything to the contrary set
forth in this Lease, any sums payable or granted in any way by the public
utility corporation supplying electricity to the Building resulting from the
installation in the Demised Premises of energy efficient lamping, special
supplemental heating, ventilation and air conditioning systems or any other
Alterations, which sums are paid or given by way of rebate, direct payment,
credit or otherwise, shall be and remain the property of Owner, and Tenant shall
not be entitled to any portion thereof, unless
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such lamping, supplemental heating, ventilation and air conditioning systems or
other Alterations were installed by Tenant, solely at Tenant's expense. Nothing
contained in the foregoing sentence, however, shall be deemed to obligate Owner
to supply or install in the Demised Premises any such lamping, supplemental
heating, ventilation and air conditioning systems or other Alterations.
Section 29.05. Water: If Tenant requires, uses or consumes water
-----
for any purpose in addition to ordinary lavatory, cleaning and drinking
purposes, Owner may install a hot water meter and a cold water meter and thereby
measure Tenant's consumption of water for all purposes. Tenant shall pay to
Owner the cost of any such meters and their installation, and Tenant shall keep
any such meters and any such installation equipment in good working order and
repair, at Tenant's cost and expense. Tenant agrees to pay for water consumed as
shown on said meters, and sewer charges, taxes and any other governmental
charges thereon, as and when bills are rendered. In addition to any sums
required to be paid by Tenant for hot water consumed and sewer charges, taxes
and any other governmental charges thereon under the foregoing provisions of
this Section, Tenant agrees to pay to Owner a reasonable charge, for the heating
of said hot water. For the purposes of determining the amount of any sums
required to be paid by Tenant under this Section, all hot and cold water
consumed during any period when said meters are not in good working order shall
be deemed to have been consumed at the rate of consumption of such water during
the most comparable period when such meters were in good working order.
Section 29.06. Overtime Periods: A. The Fixed Rent does not
----------------
reflect or include any charge to Tenant for the furnishing or distributing of
any elevator facilities or HVAC services to the Demised Premises during periods
(referred to as "Overtime Periods") other than the hours and days set forth
----------------
above in this Article for the furnishing and distributing of such services.
Accordingly, if Owner shall furnish any such elevator facilities or HVAC
services to the Demised Premises at the request of Tenant during Overtime
Periods, Tenant shall pay Owner for such services at the standard rates then
fixed by Owner for the Building or, if no such rates are then fixed, at
reasonable rates provided that such rates shall not exceed the rates charged by
Owner to any other tenant of the Building. Owner shall not be required to
furnish any such services during Overtime Periods, unless Owner has received
reasonable advance notice of not less than four (4) hours provided however that
such request shall be given by Tenant to Owner between 7:00 A.M. and 6:00 P.M.
on business days and between 7:00 A.M. to 1:00 P.M. on Saturdays from Tenant
requesting such services. If Tenant fails to give Owner reasonable advance
notice requesting such services during any Overtime Periods, then, whether or
not the Demised Premises are habitable during such Overtime Periods, failure by
Owner to furnish or distribute any such services during such Overtime Periods
shall not constitute an actual or constructive eviction, in whole or in part, or
entitle Tenant to any abatement or diminution of rent, or relieve Tenant from
any of its obligations under this Lease, or impose any liability upon Owner or
its agents by reason of inconvenience or annoyance to Tenant, or injury to or
interruption of Tenant's business or otherwise.
B. Owner and Tenant agree that as of the date of
this Lease; (i) the hourly rate of providing overtime conditioned air is THIRTY-
NINE AND 00/100 ($39.00) DOLLARS per floor; (ii) the hourly rate for providing
overtime heat is SEVENTY-TWO AND 00/100 ($72.00) DOLLARS per floor and (iii) the
hourly rate for providing overtime elevator service is SIXTY-FIVE ($65.00)
DOLLARS per freight elevator. The aforementioned hourly rates for providing
conditioned air, heat and elevator service shall be increased from time to time,
on the basis of actual increases in the cost to Owner of the various components
thereof over the cost to Owner of such components in effect as of the date of
this Lease. Subject to union requirements, there is a four (4) hour minimum for
Tenant's request for overtime conditioned air or heat unless such overtime
conditioned air or heat is requested for the period immediately following the
normal operating hours set forth in Section 29.02 in which event there is a one
(1) hour minimum.
C. Owner agrees that Tenant shall not be
required to pay for Tenant's use of the freight elevator for Tenant's initial
move into the Demised Premises during four (4) weekends to be designated by
Tenant upon at least ten (10) days prior notice to Owner. For purposes of the
preceding sentence, a weekend shall mean from 5:00 P.M. Friday to 12:00 midnight
on Sunday.
Section 29.07. Owner's Right to Stop Service: Owner reserves the
-----------------------------
right to stop the service of the HVAC, elevator, plumbing, electrical or other
mechanical systems or facilities in the Building when necessary by reason of
accident or emergency, or for repairs, alterations, replacements or
improvements, which, in the judgment
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of Owner are desirable or necessary, until said repairs, alterations,
replacements or improvements shall have been completed. The exercise of such
right by Owner shall not constitute an actual or constructive eviction, in whole
or in part, or entitle Tenant to any abatement or diminution of rent, or relieve
Tenant from any of its obligations under this Lease, or impose any liability
upon Owner or its agents by reason of inconvenience or annoyance to Tenant, or
injury to or interruption of Tenant's business, or otherwise. Owner shall employ
reasonable diligence in attempting to restore the operation of such system or
facilities including, where necessary, the employment of labor at overtime or
other premium pay rates. Except in cases of emergency, Owner (i) agrees to give
Tenant reasonable advance notice of any such stoppage, (ii) shall coordinate any
such stoppage with Tenant In an attempt to minimize interference with Tenant's
normal business operations and (iii) shall endeavor to schedule such stoppage
only on those weekends or week nights upon which Owner and Tenant shall
reasonably agree. If (i) by reason of an occurrence, other than such occurrences
as are contemplated in Articles 9 and 10, which is an insured risk under any
insurance policy carried by Owner (Owner covenants to maintain such insurance
policy provided it is available at commercially reasonable rates), all or any
portion of the Demised Premises is rendered untenantable for a period or more
than ten (10) consecutive business days, and (ii) Owner is reimbursed under such
policy for its loss of rent by reason of the rent abatement hereafter provided,
the Fixed Rent and any increases therein allocable to such portion of the
Demised Premises shall be abated for the period from the end of such ten (10)
day period to and including the day immediately preceding the date upon which
Tenant is able to use such portion of the Demised Premises. Owner agrees to use
reasonable diligence to maintain a Boiler and Machinery insurance policy with
business interruption covering throughout the Demised Term. Owner agrees to use
reasonable diligence in making any repairs, alterations, replacements or
improvements under the provisions of this Section 29.07, including, where
necessary, the employment of labor at overtime or other premium pay rates.
Section 29.08. Tenant's Existing and Additional Supplemental A/C
-------------------------------------------------
Unit/Cooling Tower:
------------------
A. (1) Supplementing the provisions of Section
29.05, as of the date of this Lease, there are separate air conditioning systems
serving the Additional Space as follows: (a) 98.6 tons on the 4/th/ floor; (b)
66 tons on the 5/th/ floor; (c) 1.44 tons on the 6/th/ floor; (d) 8.19 tons on
the 7/th/ floor; and (e) 6.46 tons on the 8/th/ floor (referred to collectively
herein as "Tenant's Existing Supplemental A/C Units") which are currently hooked
----------------------------------------
up to the Building cooling tower and associated piping (referred to herein as
the "Cooling Tower"). The provisions of this Section 29.08.A shall apply to
-------------
Tenant's Existing Supplemental A/C Units and the provisions of Section 29.08.B
shall apply to any other separate air conditioning system serving all or any
part of the Demised Premises installed by or on behalf of Tenant in accordance
with the provisions of this Lease. Owner agrees, subject to the provisions of
Article 26, Section 29.07 and this Section, to supply condenser water to
Tenant's Existing Supplemental A/C Units and accordingly Tenant agrees that
subject to any increases thereof pursuant to subdivision (2) of this Subsection
A, from and after the Additional Space Commencement Date the Fixed Rent shall be
increased per annum by the product of (x) FOUR HUNDRED FIFTY and 00/100
($450.00) DOLLARS multiplied by (y) 300, the total number of tons (including
fractions of a ton) of Tenant's Existing Supplemental A/C Units and Tenant's
Additional Supplemental A/C Units (hereinafter referred to) which Tenant shall
be entitled to connect (referred to herein as the "Tenant's Additional Space
-------------------------
Cooling Tower Charge"). Tenant shall not be required to pay a "hookup" charge
--------------------
for Tenant's Existing Supplemental A/C Units.
(2) If the regular hourly wage rate of
operating engineers employed in the Building shall be increased in any
Escalation Year (as defined in Article 23) over the rate in effect on January 1,
2000, the Fixed Rent for such Escalation Year shall be increased by a sum equal
to that proportion of Tenant's Additional Space Cooling Tower Use Charge, which
such increase in said hourly wage rate bears to the hourly wage rate in effect
on January 1, 2000. The increase in Fixed Rent for any Escalation Year pursuant
to the provisions of the immediately preceding sentence shall be shown on the
Owner's Operating Expense Statement with respect to such Escalation Year
rendered by Owner pursuant to the provisions of said Article 23, and shall be
payable by Tenant as if it were an increase in the Fixed Rent pursuant to the
provisions of said Article 23.
(3) Tenant's Existing Supplemental A/C Units
shall be repaired and maintained by Tenant, at Tenant's cost and expense.
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B. (1) Supplementing the provisions of
Section 29.05 and Section 29.08.A., in the event (a) any additional separate air
conditioning system to serve the Demised Premises are hereafter installed by or
on behalf of Tenant in accordance with the provisions of this Lease (referred to
herein as "Tenant's Additional Supplemental A/C Units"), (b) Tenant requests
------------------------------------------
that such Units be hooked up to the Cooling Tower, and (c) Owner consents to
such hookup, then, in those events, Owner agrees, subject to the provisions of
Article 26 and Section 29.07, to supply condenser water to Tenant's Additional
Supplemental A/C Units and Tenant agrees that Tenant shall pay to Owner, upon
demand, the sum of SEVEN HUNDRED and 00/100 ($700.00) DOLLARS per ton multiplied
by the number of tons of any such Tenant's Additional Supplemental A/C Units so
hooked up as a one time hook up fee (subject to any increases in such per ton
charge based upon increases in Owner's hook up costs above the costs in effect
on the date of this Lease).
(2) If the regular hourly wage rate of
operating engineers employed in the Building shall be increased in any
Escalation Year over the rate in effect on January 1, 2000, the Fixed Rent for
such Escalation Year shall be increased by a sum equal to that proportion of
Tenant's Additional Cooling Tower Use Charge which such increase in said hourly
wage rate bears to the hourly wage rate in effect on January 1, 2000. The
increase in Fixed Rent for any Escalation Year pursuant to the provisions of the
immediately preceding sentence shall be shown on the Owner's Operating Expense
Statement with respect to such Escalation Year rendered by Owner pursuant to the
provisions of said Article 23, and shall be payable by Tenant as if it were an
increase in the Fixed Rent pursuant to the provisions of said Article 23.
(3) Any increase in Fixed Rent for
Tenant's Additional Cooling Tower Use Charge for any Tenant's Additional
Supplemental A/C Unit on any additional space leased by Tenant pursuant to this
Lease other than floors 2-10, shall be effective as of the date such Tenant's
Additional Supplemental A/C Unit is hooked up to the Cooling Tower and shall be
retroactive to such date if necessary.
(4) Tenant's Additional Supplemental
A/C Unit shall be repaired and maintained by Tenant, at Tenant's cost and
expense.
C. Owner agrees that Tenant shall be
entitled to connect (i) a total of 300 tons in the aggregate of Tenant's
Existing and Additional Supplemental A/C Units with respect to the original
Demised Premises (i.e. second (2/nd/) through tenth (10/th/) floors and Basement
Space) with such 300 tons to include the tonnage already used by Tenant's
Existing Supplemental A/C Units, and (ii) up to an additional 15 tons of
Supplemental A/C Units for each full floor in addition to the original Demised
Premises which Tenant may add to the Demised Premises pursuant to the provisions
of this Lease provided for each such full floor, Tenant notifies Owner by the
date six (6) months next following the date upon which Tenant exercises its
right to lease such floor that it wishes to make such connection, time being of
the essence and the Fixed Rent reserved in this Lease and Tenant's Additional
Space Cooling Tower Charge shall be further increased per annum by a sum equal
to (x) FOUR HUNDRED FIFTY and 00/100 ($450) DOLLARS multiplied by (xx) the
number of tons of Tenant's Additional Supplemental A/C Units for such full
floor, subject to any increases therein as provided herein.
Section 29.09. Owner represents and covenants that the HVAC
system was designed in accordance and compliance with the New York City Building
Code and that the HVAC system shall, throughout the term of this Lease, achieve
the recommended minimum ventilation rate set forth in Table 2 of the 62-1989
Standard (Ventilation for acceptable Indoor Air Quality) of the American Society
of Heating, Refrigeration and Air Conditioning Engineers Inc. (the "ASHRAE
Standard") and that (to the extent the HVAC system has the capability with no
obligation of Owner to increase such capability) the HVAC system shall be
operated in accordance with the then current ASHRAE Standard. Notwithstanding
the foregoing, Owner shall not be liable to Tenant if the HVAC system fails to
comply with the requirements of the preceding sentence if such failure is the
result of any act, omission or negligence of Tenant (including, but not limited
to, Tenant's Alterations or Tenant's manner of use of the Demised Premises in
contradistinction to mere use in accordance with the provisions of Section 2.01)
or the result of Owner's compliance with any Legal Requirement.
Section 29.10. Owner represents that it shall operate the
Building as a first class office building similar to the operation of other
first class office buildings in New York City with comparable rental rates.
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ARTICLE 30
TABLE OF CONTENTS, ETC.
----------------------
Section 30.01. Table of Contents/Captions: The Table of
--------------------------
Contents and the captions following the Articles and Sections of this Lease have
been inserted solely as a matter of convenience and in no way define or limit
the scope or intent of any provision of this Lease.
ARTICLE 31
MISCELLANEOUS DEFINITIONS, SEVERABILITY AND INTERPRETATION PROVISIONS
---------------------------------------------------------------------
Section 31.01. The term "business days" as used in this
-------------
Lease shall exclude Saturdays, Sundays and holidays, the term "Saturdays" as
---------
used in this Lease shall exclude holidays and the term "holidays" as used in
--------
this Lease shall mean all days observed as legal holidays by either the New York
State Government or the Federal Government.
Section 31.02. The terms "Person" and "persons" as used in
------ -------
this Lease shall be deemed to include natural persons, firms, corporations,
associations and any other private or public entities, whether any of the
foregoing are acting on their own behalf or in a representative capacity.
Section 31.03. The term "prime rate" shall mean the rate of
----------
interest announced publicly by Chemical Bank, or its successor, from time to
time, as Chase Manhattan Bank's or such successor's base rate, or if there is no
such base rate, then the rate of interest charged by Chase Manhattan Bank or its
successor to its most credit worthy customers on commercial loans having a
ninety (90) day duration.
Section 31.04. If any term, covenant or condition of this
Lease or any application thereof shall be invalid or unenforceable, the
remainder of this Lease and any other application of such term, covenant or
condition shall not be affected thereby.
Section 31.05. This Lease shall be construed without regard
to any presumption or other rule requiring construction against the party
causing this Lease to be drafted. In the event of any action, suit, dispute or
proceeding affecting the terms of this Lease, no weight shall be given to any
deletions or striking out of any of the terms of this Lease contained in any
draft of this Lease and no such deletion or strike out shall be entered into
evidence in any such action, suit or dispute or proceeding given any weight
therein.
ARTICLE 32
ADJACENT EXCAVATION
-------------------
Section 32.01. If an excavation shall be made upon land
adjacent to the Real Property, or shall be authorized to be made, Tenant shall
afford to the person causing or authorized to cause such excavation license to
enter upon the Demised Premises for the purpose of doing such work as said
person shall deem necessary to preserve the walls and other portions of the
Building from injury or damage and to support the same by proper foundations and
no such entry shall constitute an actual or constructive eviction, in whole or
in part, or entitle Tenant to any abatement or diminution of rent, or relieve
Tenant from any of its obligations under this Lease, or impose any liability
upon Owner or said person.
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ARTICLE 33
BUILDING RULES
Section 33.01. Tenant shall observe faithfully, and comply
strictly with, and shall not permit the violation of, the Building Rules set
forth in Schedule A annexed to and made a part of this Lease and such additional
reasonable Building Rules as Owner may, from time to time, adopt. All of the
terms, covenants and conditions of Schedule A are incorporated in this Lease by
reference and shall be deemed part of this Lease as though fully set forth in
the body of this Lease. The term "Building Rules" as used in this Lease shall
--------------
include those set forth in Schedule A and those hereafter made or adopted as
provided in this Section. In case Tenant disputes the reasonableness of any
additional Building Rule hereafter adopted by Owner, the parties hereto agree to
submit the question of the reasonableness of such Building Rule for decision to
the Chairman of the Board of Directors of the Management Division of the Real
Estate Board of New York, Inc., or its successor (the "Chairman"), or to such
--------
impartial person or persons as the Chairman may designate, whose determination
shall be final and conclusive upon Owner and Tenant. Tenant's right to dispute
the reasonableness of any additional Building Rule shall be deemed waived unless
asserted by service of a notice upon Owner within thirty (30) days after the
date upon which Owner shall give notice to Tenant of the adoption of any such
additional Building Rule. Owner shall have no duty or obligation to enforce any
Building Rule, or any term, covenant or condition of any other lease, against
any other tenant or occupant of the Building, and Owner's failure or refusal to
enforce any Building Rule or any term, covenant or condition of any other lease
against any other tenant or occupant of the Building shall not constitute an
actual or constructive eviction, in whole or in part, or entitle Tenant to any
abatement or diminution of rent, or relieve Tenant from any of its obligations
under this Lease, or impose any liability upon Owner or its agents by reason of
inconvenience or annoyance to Tenant, or injury to or interruption of Tenant's
business, or otherwise. Any Building rule not enforced generally against other
tenants of the Building shall not be enforced against Tenant.
ARTICLE 34
BROKER
------
Section 34.01. Tenant represents and warrants to Owner that
CUSHMAN & WAKEFIELD, INC., ("Broker") is the sole broker with whom Tenant has
negotiated or otherwise dealt with in connection with the Demised Premises or in
bringing about this Lease. Owner agrees to pay the Broker a brokerage commission
pursuant to the provisions of a separate agreement between Owner and Broker.
Tenant shall indemnify Owner from all loss, cost, liability, damage and
expenses, including, but not limited to, reasonable counsel fees and
disbursements, arising from any breach of the foregoing representation and
warranty.
ARTICLE 35
INTENTIONALLY DELETED
---------------------
ARTICLE 36
ARBITRATION, ETC.
----------------
Section 36.01. Any dispute (i) with respect to the
reasonability of any failure or refusal of Owner to grant its consent or
approval to any request for such consent or approval pursuant to the provisions
of Sections 3.01 or 11.03 with respect to which request Owner has agreed, in
such Sections, not unreasonably to withhold such consent or approval, or (ii)
arising out of the application of the Operating Expenses provisions of Article
23, which is submitted to arbitration shall be finally determined by arbitration
in the City of New York in accordance with the following provisions of this
Section 36.01. Within five (5) business days next following the giving of any
notice by either party to the other stating that it wishes such dispute to be so
determined, Owner and Tenant shall each give notice to the other
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setting forth the name and address of an arbitrator designated by the party
giving such notice. If either party shall fail to give notice of such
designation within five (5) business days, the arbitrator chosen by the other
side shall make the determination alone. The two arbitrators shall designate a
third arbitrator. If the two arbitrators shall fail to agree upon the
designation of a third arbitrator within five (5) business days after the
designation of the second arbitrator, then either party may apply to the Supreme
Court of the State of New York or to any other court having jurisdiction, for
the designation of such arbitrator. All arbitrators shall be persons who shall
have had at least ten (10) years continuous experience in the business of
appraising or managing real estate or acting as a real estate agent or brokers
in the Borough of Manhattan, except in the event of arbitration of a dispute
under Section 3.02 such arbitrators shall be persons who are licensed architects
in the State of New York and who shall have at least ten (10) years continuous
experience as architects in the Borough of Manhattan. The three arbitrators
shall conduct such hearings as they deem appropriate, making their determination
in writing and giving notice to Owner and Tenant of their determination as soon
as practicable, and if possible, within five (5) business days after the
designation of the third arbitrator; the concurrence of any two (2) of said
arbitrators shall be binding upon Owner and Tenant, or, in the event no two (2)
of the arbitrators shall render a concurrent determination, then the
determination of the third arbitrator designated shall be binding upon Owner and
Tenant. Any such determination shall be final and binding upon the parties,
whether or not a judgment shall be entered in any court. In making their
determination, the arbitrators shall not subtract from, add to, or otherwise
modify any of the provisions of this Lease. Owner and Tenant may, at their own
expense, be represented by counsel and employ expert witnesses in any such
arbitration. Any dispute with respect to the reasonability of any failure or
refusal of Owner to grant its consent or approval to any request for such
consent or approval pursuant to any of the provisions of this Lease (other than
Sections 3.01 and 11.03) with respect to which Owner has covenanted not
unreasonably to with hold such consent or approval, and any dispute arising with
respect to the increases in Fixed Rent due to the provisions of Section 23.02
shall be determined by applicable legal proceedings. If the determination of any
such legal proceedings, or of any arbitration held pursuant to the provisions of
this Section with respect to disputes arising under Sections 3.01 and 11.03 or
the Operating Expense provisions of Article 23, shall be adverse to Owner, Owner
shall be deemed to have granted the requested consent or approval, or be bound
by any determination as to Taxes and Operating Expenses and the increases in
Fixed Rent relating thereto, but that shall be Tenant's sole remedy in such
event and Owner shall not be liable to Tenant for a breach of Owner's covenant
not unreasonably to withhold such consent or approval, or otherwise. Each party
shall pay its own counsel and expert witness fees and expenses, if any, in
connection with any arbitration held pursuant to the provisions of this Section
and the parties will share all other expenses and fees of any such arbitration.
ARTICLE 37
PARTIES BOUND
-------------
Section 37.01. The terms, covenants and conditions contained
in this Lease shall bind and inure to the benefit of Owner and Tenant and,
except as otherwise provided in this Lease, their respective heirs,
distributees, executors, administrators, successors and assigns. However, the
obligations of Owner under this Lease shall no longer be binding upon Owner
named herein after the sale, assignment or transfer by Owner named herein (or
upon any subsequent Owner after the sale, assignment or transfer by such
subsequent Owner) of its interest in the Building as owner or lessee, and in the
event of any such sale, assignment or transfer, such obligations shall
thereafter be binding upon the grantee, assignee or other transferee of such
interest, and any such grantee, assignee or transferee, by accepting such
interest, shall be deemed to have assumed such obligations. A lease of the
entire Building shall be deemed a transfer within the meaning of the foregoing
sentence. Neither the partners (direct or indirect) comprising Owner, nor the
shareholders (nor any of the partners comprising same), partners, directors or
officers of any of the foregoing (collectively, the "Owner's Parties") shall be
---------------
liable for the performance of Owner's obligations under this Lease. Tenant shall
look solely to Owner to enforce Owner's obligations hereunder and shall not seek
any damages against any of the Owner's Parties. Notwithstanding anything
contained in this Lease to the contrary, Tenant shall look solely to the estate
and interest of Owner, its successors and assigns, in the Real Property and
Building for the collection or satisfaction of any judgment recovered against
Owner based upon the breach by Owner of any of the terms, conditions or
covenants of this Lease on the part of Owner to be performed, and no other
property or assets of Owner or any of Owner's Parties shall be subject to levy,
execution or other enforcement procedure for the satisfaction
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of Tenant's remedies under or with respect to either this Lease, the
relationship of landlord and tenant hereunder, or Tenant's use and occupancy of
the Demised Premises.
ARTICLE 38
ADDITIONAL SPACE
----------------
Section 38.01. A. The entire third (3/rd/), fourth
(4/th/), fifth (5/th/), sixth (6/th/), seventh (7/th/), eighth (8/th/), ninth
(9/th/) and tenth (10/th/) floors and a portion of the basement of the Building,
indicated by outlining and diagonal markings on the floor plan initialed by the
parties, annexed hereto as Exhibit 1, are referred to as the "Additional Space".
----------------
Owner hereby leases to Tenant and Tenant hereby hires from Owner the Additional
Space, upon all the then executory terms, covenants and conditions contained in
this Lease (including, but not limited to, the definitions of Base Operating
Expenses set forth in Section 23.01, and Owner's Basic Tax Liability set forth
in Section 23.01), except as otherwise provided in this Article, for a term to
commence, subject to the provisions of Subsections B and C of this Section 38.01
on September 1, 2001(the date upon which the Demised Term applicable to the
Additional Space shall commence is hereinafter referred to as the "Additional
----------
Space Commencement Date") and to end on the Expiration Date, unless sooner
-----------------------
terminated pursuant to any of the terms, covenants or conditions of this Lease
or pursuant to law. The basement portion of the Additional Space is referred to
as the "Basement Space" and the remainder of the Additional Space is sometimes
--------------
referred to herein as the "Remainder Space".
---------------
B. Tenant acknowledges that Owner has
advised Tenant that the Additional Space is presently affected by a letting
agreement with Bank of America (referred to as the "Present Occupant") for a
----------------
term to expire on August 31, 2001 unless sooner terminated pursuant to any of
the terms, covenants or conditions of the lease with the Present Occupant or
pursuant to law. Notwithstanding anything to the contrary contained in this
Lease, if Tenant shall fail to deliver to Owner Tenant's Additional Demolition
Plans (as hereinafter defined) which shall be entitled to meet with Owner's
approval by July 1, 2001and the Present Occupant does not vacate and surrender
the Additional Space to Owner on or prior to August 31, 2001, then (i) the
Additional Space Commencement Date shall not occur on September 1, 2001, but
shall, instead, occur on the date next following the date that the Present
Occupant has vacated and surrendered the Additional Space to Owner, (ii) the
Expiration Date shall occur on the date set forth in Section 1.02A, unless
sooner terminated pursuant to any of the terms, covenants or conditions of this
Lease or pursuant to law, (iii) except as set forth in this sentence, neither
the validity of this Lease nor the obligations of Tenant under this Lease shall
be affected thereby, (iv) Tenant waives any right under Section 223-a of the
Real Property Law of New York or any successor law of like import to rescind
this Lease or rescind its obligations with respect to this Lease and (v) except
as otherwise provided in Section 38.05 Tenant further waives the right to
recover any damages which may result from the failure of Owner to deliver
possession of the Additional Space to Tenant on September 1, 2001.
C. Notwithstanding anything to the contrary
contained in this Lease in the event that Tenant has submitted to Owner Tenant's
Additional Demolition Plans which shall be entitled to meet with Owner's
approval on or prior to July 1, 2001, and Owner has not substantially completed
Owner's Additional Work by September 1, 2001 for any reason, including, but not
limited to, the failure of the Present Occupant to have vacated the Additional
Space in time for Owner to have so substantially completed Owner's Additional
Work by such date, then, (i) the Additional Space Commencement Date shall not
occur on September 1, 2001 but shall instead occur on the date fixed in a notice
by Owner to Tenant not sooner than five (5) days next following the date of the
giving of such notice which notice shall state that Owner has, or prior to the
commencement date fixed in said notice will have, substantially completed
Owner's Additional Work, and (ii) the Expiration Date shall occur on the date
set forth in Section 1.02A, unless sooner terminated pursuant to any of the
terms, covenants or conditions of this Lease or pursuant to law, (iii) except as
set forth in this sentence, neither the validity of this Lease nor the
obligations of Tenant under this Lease shall be affected thereby, (iv) Tenant
waives any right under Section 223(a) of the Real Property Law of New York or
any successor law of like import to rescind this Lease or rescind its
obligations with respect to this Lease; and (v) Tenant further waives the right
to recover any damages which may result from the failure of Owner to deliver
possession of the Additional Space on September 1, 2001.
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Section 38.02. On the Additional Space Commencement Date
this Lease shall be deemed modified as follows:
A. The Demised Premises shall include the Additional
Space (together with all appurtenances, fixtures, improvements, additions and
other property attached thereto or installed therein on the Additional Space
Commencement Date or at any time during the Demised Term applicable to the
Additional Space, other than Tenant's Personal Property), for all purposes of
this Lease;
B. (i) The Fixed Rent shall be increased
by the following annual rental
rates:
1. SEVEN MILLION FOUR HUNDRED
THIRTY-ONE THOUSAND THREE HUNDRED AND 00/100 ($7,431,300.00) DOLLARS per annum
with respect to the period from the Additional Space Commencement Date to and
including the last day of the First Rent Period;
2. EIGHT MILLION TWENTY-FIVE
THOUSAND EIGHT HUNDRED FOUR AND 00/100 ($8,025,804.00) DOLLARS per annum with
respect to the Second Rent Period; and
3. EIGHT MILLION SEVEN HUNDRED
SIXTY-EIGHT THOUSAND NINE HUNDRED THIRTY-FOUR AND 00/100 ($8,768,934.00) DOLLARS
per annum with respect to the remainder of the Demised Term.
(ii) The monthly instalments of the
Fixed Rent shall be increased by the following amounts:
1. SIX HUNDRED NINETEEN THOUSAND
TWO HUNDRED SEVENTY-FIVE AND 00/100 ($619,275.00) DOLLARS with respect to the
period from the Additional Space Commencement Date to and including the last day
of the First Rent Period;
2. SIX HUNDRED SIXTY-EIGHT
THOUSAND EIGHT HUNDRED SEVENTEEN AND 00/100 ($668,817.00) DOLLARS with respect
to the Second Rent Period;
3. SEVEN HUNDRED THIRTY THOUSAND
SEVEN HUNDRED FORTY-FOUR AND 50/100 ($730,744.50) DOLLARS with respect to the
remainder of the Demised Term.
(iii) Notwithstanding anything to the
contrary set forth in this Article, Tenant shall not be required to pay any
portion of the increase in the Fixed Rent allocable to the Additional Space set
forth in subdivision (i) of this Subsection B with respect to the period
("Additional Space Rent Holiday Period") from the Additional Space Commencement
------------------------------------
Date to and including the date 180 days thereafter, but (a) during the
Additional Rent Holiday Period Tenant shall otherwise be required to comply with
all of the other terms, covenants and conditions of this Lease on Tenant's part
to be observed or performed.
(iv) In the event that the date 181 days
next following the Additional Space Commencement Date shall occur on a date
other than the first day of any month, the monthly instalment of the Fixed Rent
for the month during which such date shall occur shall be increased pro rata to
reflect such increase in the Fixed Rent;
C. The Demised Premises Area set forth in Section
23.01 shall be increased by 151,876 square feet of which 145,376 square feet is
allocable to the Remainder Space and 6,500 square feet is allocable to the
Basement Space. Notwithstanding anything to the contrary contained herein,
Tenant shall not be required to pay increases in Operating Expenses pursuant to
the provisions of Section 23.04 with respect to the Basement Space.
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D. The parties agree that (i) with respect to the
First Rent Period, ONE HUNDRED SIXTY-TWO THOUSAND FIVE HUNDRED AND 00/100
($162,500.00) DOLLARS of the Fixed Rent is allocated to the Basement Space and
the remainder of the Fixed Rent is allocated to the Remainder Space; (ii) with
respect to the Second Rent Period, ONE HUNDRED SEVENTY-FIVE THOUSAND FIVE
HUNDRED AND 00/100 ($175,500.00) DOLLARS of the Fixed Rent is allocated to the
Basement Space and the remainder of the Fixed Rent is allocated to the Remainder
Space; and (iii) with respect to the Third Rent Period, ONE HUNDRED NINETY-ONE
THOUSAND SEVEN HUNDRED FIFTY AND 00/100 ($191,750.00) DOLLARS of the Fixed Rent
is allocated to the Basement Space and the remainder of the Fixed Rent is
allocated to the Remainder Space.
Section 38.03. A. Tenant acknowledges that Owner has made no
representations to Tenant with respect to the condition of the Additional Space
and Tenant agrees to accept possession of the Additional Space in the condition
which shall exist on the Additional Space Commencement Date "as is" and further
agrees that Owner shall have no obligation to perform any work or make any
installations in order to prepare the Additional Space for Tenant's occupancy
except as otherwise provided in Subsection B of this Section 38.03 to the
contrary.
B. Owner shall perform the following work in the
Remainder Space and place the Remainder Space in a so called "broom clean
condition" (referred to as "Owner's Additional Work"): demolish the presently
-----------------------
existing interior Alterations in the Remainder Space in accordance with Tenant's
demolition plans ("Tenant's Additional Demolition Plans") which shall be
------------------------------------
approved by Owner, such approval not to be unreasonably withheld, and remove any
asbestos from all portions of the Remainder Space to be occupied by Tenant in
accordance with Legal Requirements so as to be able to deliver to Tenant a form
ACP-5 with respect to the Remainder Space upon Tenant's submission to Owner of
plans which are in compliance with all Legal Requirements and the provisions of
this Lease. Owner's Additional Work shall (i) be substantially completed prior
to the Additional Space Commencement Date in the event that Tenant has submitted
to Owner by July 1, 2001, Tenant's Additional Demolition Plans which shall be
entitled to meet with Owner's approval as provided in Subsection 38.01C or (ii)
be performed and completed subsequent to the Additional Space Commencement Date
in the event that Tenant has not submitted to Owner by July 1, 2001, Tenant's
Additional Demolition Plans which shall be entitled to meet with Owner's
approval as provided in Subsection 38.03D provided Tenant requests Owner by one
(1) year immediately following the Additional Space Commencement Date to so
perform Owner's Additional Work. Notwithstanding anything to the contrary set
forth herein, Owner shall not be required to perform Owner's Additional Work if
such request is not made by Tenant within such one (1) year period , time being
of the essence with respect thereto.
C. Owner's Additional Work required to be performed
and made by Owner pursuant to the provisions of this Section 38.03 shall be
equal to standards adopted by Owner for the Building and shall constitute a
single, non-recurring obligation on the part of Owner. In the event this Lease
is renewed or extended for a further term by agreement or operation of law,
Owner's obligation to perform such work shall not apply to such renewal or
extension. In the event that Owner's Additional Work shall be required to be
substantially completed prior to the Additional Space Commencement Date, as
provided in Subsection 38.01C, then entry by Owner or its contractors into the
Additional Space to complete unfinished details of Owner's Additional Work after
the Additional Space Commencement Date shall not constitute an actual or
constructive eviction in whole or in part, or entitle Tenant to any abatement or
diminution of rent, or relieve Tenant from any obligations under this Lease or
impose any liability upon Owner, or its agents, provided that Owner shall
complete such unfinished details with reasonable diligence and shall use
reasonable efforts to mitigate interference with the operation of Tenant's
business in the Demised Premises without any obligation to employ labor at
overtime or other premium pay rates.
D. If Tenant shall fail to deliver to Owner Tenant's
Additional Demolition Plans which shall be entitled to meet with Owner's
approval by July 1, 2001, then Tenant shall accept the Additional Space on the
Additional Space Commencement Date in an "as is" "broom clean condition" and
provided (i) Tenant notifies Owner by the date one (1) year immediately
following the Additional Space Commencement Date (the "Additional Space Work
---------------------
Request Date") to commence the performance of Owner's Additional Work, and (ii)
------------
Tenant shall have submitted to Owner Tenant's Additional Demolition Plans which
shall be entitled to meet with Owner's approval by the Additional Space Work
Request Date, Owner, at Owner's expense shall perform Owner's Additional Work.
Provided Tenant shall have submitted to Owner Tenant's Additional Demolition
Plans which shall be entitled to meet with Owner's approval, Owner shall
commence the performance of Owner's Additional Work with respect to the
Remainder Space or any applicable full floor thereof within thirty (30) days
after Tenant shall have vacated the
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Remainder Space or any applicable full floor thereof to enable Owner to perform
Owner's Additional Work with respect to the Remainder Space or any applicable
full floor thereof. Tenant shall not be required to pay any portion of the
increase in the Fixed Rent allocable to the Remainder Space or any applicable
full floor thereof or any increases therein with respect to the period
("Additional Work Period") from the earlier of (a) the date, subsequent to the
submission by Tenant to Owner of Tenant's Additional Demolition Plans which
shall be entitled to meet with Owner's approval, thirty (30) days following the
date upon which Tenant has vacated the Remainder Space or any applicable full
floor thereof to permit Owner to perform Owner's Additional Work therein, or (b)
the date when Owner commences the performance of Owner's Additional Work with
respect to the Remainder Space or any applicable full floor thereof, to and
including the date upon which Owner shall have substantially completed Owner's
Additional Work with respect to the Remainder Space or any applicable full floor
thereof, but Tenant shall otherwise be required to comply with all of the other
terms, covenants and conditions of this Lease on Tenant's part to be observed or
performed. If any portion ("2/nd/ Duplicative Portion") of the applicable
-------------------------
Additional Work Period occurs during the Additional Rent Holiday Period, then
the Additional Rent Holiday Period shall be extended by the number of days
occurring during the 2/nd/ Duplicative Portion to give effect to the rent
holiday set forth in the foregoing sentence.
Section 38.04. Upon request of Owner, Tenant will execute,
acknowledge, and deliver to Owner an instrument, in form reasonably satisfactory
to Owner, setting forth the Additional Space Commencement Date. However, neither
the failure of Owner to request the execution and delivery of such instrument
nor the failure of Tenant to execute and deliver such instrument shall vitiate
the provisions of this Article.
Section 38.05. Notwithstanding anything to the contrary contained in
this Lease, if the Present Occupant does not vacate and surrender the Additional
Space to Owner on or prior to August 31, 2001, then Owner shall institute, on or
before September 3, 2001, possession proceedings against the Present Occupant
and shall prosecute such proceeding to completion with reasonable diligence.
Owner agrees not to renew or extend the term of the lease with the Present
Occupant beyond September 3, 2001. In connection with any summary proceeding
commenced by Owner against the Present Occupant pursuant to the provisions of
this Section 38.05, Owner agrees to use reasonable efforts to recover from the
Present Occupant any sums payable by Owner to Tenant by virtue of the provisions
of the following sentence. Owner agrees to indemnify and hold Tenant harmless of
and from any rent increases payable by Tenant to the sublessors under the
existing subleases for space at 345 Park Avenue, New York City with Scudder,
Stevens & Clark, Inc., Loeb & Loeb and KPMG LLP during the period from September
1, 2001 to and including the date immediately preceding the Additional Space
Commencement Date in excess of the rent payable under such existing subleases as
of August 31, 2001 (the "Rent Increases") provided, and to the extent that,
Owner actually recovers such Rent Increases from Present Occupant. Nothing
contained in the foregoing provisions of this Section shall impose any liability
upon Owner in the event that Owner is unable, using reasonable diligence, to
recover any such Rent Increases, in such proceeding commenced against the
Present Occupant.
ARTICLE 39
OPTION FOR FIFTH YEAR ADDITIONAL SPACE
--------------------------------------
Section 39.01. A. Provided (a) Tenant shall not then be in default
under any of the terms, covenants or conditions of this Lease on Tenant's part
to be observed or performed beyond applicable grace periods, (b) Tenant (or its
affiliates) in contradistinction to subtenants or other occupants, shall then be
in occupancy of at least sixty (60%) percent of the space leased to Tenant under
this Lease (for the purpose of this Article 39, any space leased to Tenant under
this Lease which has been eliminated from the Demised Premises pursuant to the
provisions of Section 11.03 shall be deemed space leased to Tenant under this
Lease), Tenant shall have the option exercisable only by notice given to Owner
on or prior to September 1, 2005, to lease and add to the Demised Premises an
entire floor of the Building other than the twenty-third (23/rd/) floor, such
space to be designated by Owner as hereinafter provided (the floor so designated
is referred to as the "Fifth Year Additional Space"), upon all of the then
executory terms, covenants and conditions contained in this Lease (including,
but not limited to, the provisions of Article 23), except as otherwise provided
in this Article, for a term to commence in accordance with the provisions of
subsection B of this Section, (subject to the provisions of subsection C of this
Section), and to end on the Expiration Date, unless sooner terminated pursuant
to any of the terms, covenants or conditions of this Lease or pursuant to law.
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B. In the event Tenant gives a timely notice to
Owner, in accordance with the provisions of subsection A of this Section 39.01,
exercising the option set forth herein, Owner shall give notice to Tenant
designating the location of the Fifth Year Additional Space and setting forth
the commencement date of the term applicable to the Fifth Year Additional Space
(subject to the provisions of paragraph C of this Section), which date is
referred to as the "Expected Possession Date"), and which shall be no sooner
than September 1, 2006 and no later than June 1, 2007. Such notice shall be
given at least six (6) months prior to the Expected Possession Date.
C. (1) Owner agrees that at least one (1) entire
floor of the Building other than the twenty-third (23rd) floor shall be subject
to a lease or leases expiring, inclusive of any renewal options during the
period between September 1, 2006 and June 1, 2007. However, notwithstanding the
foregoing, Owner and Tenant acknowledge the possibility that all or any of the
tenants or occupants of the Fifth Year Additional Space may not have vacated and
surrendered all or any portions of the Fifth Year Additional Space to Owner by
the Expected Possession Date. Accordingly, if Tenant shall fail to deliver to
Owner Tenant's Fifth Year Demolition Plans (as hereinafter defined) which shall
be entitled to meet with Owner's approval by the Fifth Year Plan Submission Date
(as hereinafter defined) notwithstanding anything to the contrary contained in
paragraph B of this Section; (a) in the event that any tenants or occupants of
the Fifth Year Additional Space have not vacated the Fifth Year Additional Space
on or before the Expected Possession Date, the term of this Lease applicable to
the Fifth Year Additional Space shall commence on the date upon which the entire
Fifth Year Additional Space shall become vacant and Owner gives notice to Tenant
of such vacancy; (b) the Expiration Date shall not be affected thereby; (c)
except as set forth in this sentence, neither the validity of this Lease nor the
obligations of Tenant under this Lease shall be affected thereby; (d) Tenant
waives any rights under Section 223-a of the Real Property Law of New York or
any successor statue of similar import to rescind this Lease and further waives
the right to recover any damages from Owner which may result from the failure of
Owner to deliver possession of the Fifth Year Additional Space on the Expected
Possession Date; (e) Owner shall institute, within three (3) days after the
Expected Possession Date, possession proceedings against any tenants and
occupants who have not vacated and surrendered all or any portion of the Fifth
Year Additional Space, and shall prosecute such proceedings to completion with
reasonable diligence.
(2) Notwithstanding anything to the contrary
contained in this Lease in the event that Tenant has submitted to Owner Tenant's
Fifth Year Demolition Plans, which shall be entitled to meet with Owner's
approval on or prior to the date sixty (60) days preceding the Expected
Possession Date (the "Fifth Year Plan Submission Date"), and Owner has not
substantially completed Owner's Fifth Year Additional Work by the Expected
Possession Date for any reason, including, but not limited to, the failure of
any of the present tenants or occupants to have vacated the Fifth Year
Additional Space in time for Owner to have so substantially completed Owner's
Fifth Year Additional Work, by such date, then, (i) the commencement date of the
Demised Term applicable to the Fifth Year Additional Space ("Fifth Year
----------
Additional Space Commencement Date") shall not occur on the Expected Possession
----------------------------------
Date but shall instead occur on the date fixed in a notice by Owner to Tenant
not sooner than five (5) days next following the date of the giving of such
notice which notice shall state that Owner has, or prior to the commencement
date fixed in said notice will have, substantially completed Owner's Fifth Year
Additional Work and (ii) the Expiration Date shall not be affected thereby,
(iii) except as set forth in this sentence, neither the validity of this Lease
nor the obligations of Tenant under this Lease shall be affected thereby, (iv)
Tenant waives any right under Section 223(a) of the Real Property Law of New
York or any successor law of like import to rescind this Lease or rescind its
obligations with respect to this Lease; and (v) Tenant further waives the right
to recover any damages which may result from the failure of Owner to deliver
possession of the Fifth Year Additional Space on the Expected Possession Date.
D. On the effective commencement date of the term
applicable to the Fifth Year Additional Space, this Lease shall be deemed
modified as follows:
(i) The Demised Premises shall include the
Fifth Year Additional Space (together with
all appurtenances, fixtures, improvements,
additions and other property attached
thereto or installed therein at the
commencement of the term applicable to the
Fifth Year Additional Space or at any time
during said term, other than Tenant's
Personal Property) for all purposes of this
Lease;
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(ii) The Fixed Rent shall be increased by a sum
equal to the annual rental rate determined
as provided in Section 39.05 (but in no
event shall such increase in the Fixed Rent
per rentable square foot, from time to
time, be less than the Fixed Rent per
rentable square foot in effect, at the time
or times in question applicable to the
original portion of the Demised Premises
[before giving effect to any abatement or
apportionment of such Fixed Rent] with
respect to the period from the effective
commencement date of the term applicable to
the Fifth Year Additional Space to the
Expiration Date, both dates inclusive and
the monthly installments of the Fixed Rent
shall each be increased accordingly to
conform with such increase in the Fixed
Rent. In the event that the term applicable
to the Fifth Year Additional Space shall
commence on a date other than the first day
of any month, the monthly installment of
the Fixed Rent for the month during which
the term applicable to the Fifth Year
Additional Space shall commence shall be
equitably apportioned to reflect such
increase in the Fixed Rent.
(iii) The Demised Premises Area set forth in
Section 23.01 shall be increased by the
number of rentable square feet set forth in
Schedule C opposite the floor designated by
Owner as the Fifth Year Additional Space.
(iv) Notwithstanding anything to the contrary
set forth in this Article, Tenant shall not
be required to pay any portion of the
increase in Fixed Rent allocable to the
Fifth Year Additional Space set forth in
subdivision (i) of this Subdivision D with
respect to the period ("Fifth Year
----------
Additional Rent Holiday Period") from the
------------------------------
effective commencement date of the term
applicable to the Fifth Year Additional
Space to and including the date one hundred
eighty (180) days thereafter, but during
such period of one hundred eighty (180)
days Tenant shall otherwise be required to
comply with all of the other terms,
covenants and conditions of this Lease on
Tenant's part to be observed or performed.
(v) In the event that the date one hundred
sixty (180) days next following the
effective commencement date of the term
applicable to the Fifth Year Additional
Space shall occur on a date other than the
first (1st) day of any month, the monthly
installment of the Fixed Rent for the month
during which such date shall occur shall be
increased pro rata to reflect such increase
in the Fixed Rent.
E. It is understood and agreed that time is of the
essence with respect to the exercise of the option set forth in subsection A of
Section 39.01, and, if Tenant does not exercise such option on or prior to
September 1, 2005, any notice of the exercise of such option given after
September 1, 2005 shall be void and of no further force and effect.
Section 39.02. A. Tenant acknowledges that Owner has made no
representations to Tenant with respect to the condition of the Fifth Year
Additional Space and Tenant agrees to accept possession of the Fifth Year
Additional Space in the condition which shall exist on the Expected Possession
Date "as is" and further agrees that Owner shall have no obligation to perform
any work or make any installations in order to prepare the Fifth Year
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Additional Space for Tenant's occupancy except as otherwise provided in
Subsection B of this Section 39.02 to the contrary.
B. Owner shall perform the following work in the
Fifth Year Additional Space and place the Fifth Year Additional Space in a so
called "broom clean condition" (referred to as "Owner's Fifth Year Additional
-----------------------------
Work"): demolish the presently existing interior Alterations in the Fifth Year
----
Additional Space in accordance with Tenant's demolition plans ("Tenant's Fifth
--------------
Year Demolition Plans") which shall be approved by Owner, such approval not to
---------------------
be unreasonably withheld, and remove any asbestos from all portions of the Fifth
Year Additional Space to be occupied by Tenant in accordance with Legal
Requirements so as to be able to deliver to Tenant a form ACP-5 with respect to
the Fifth Year Additional Space upon Tenant's submission to Owner of plans which
are in compliance with all Legal Requirements and the provisions of this Lease.
Owner's Fifth Year Additional Work shall (i) be substantially completed prior to
the Fifth Year Additional Space Commencement Date in the event that Tenant has
submitted to Owner by the Fifth Year Plan Submission Date, Tenant's Fifth Year
Additional Demolition Plans which shall be entitled to meet with Owner's
approval as provided in Subsection 39.01C(2) or (ii) be performed and completed
subsequent to the Fifth Year Additional Space Commencement Date in the event
that Tenant has not submitted to Owner by the Fifth Year Plan Submission Date,
Tenant's Fifth Year Additional Demolition Plans which shall be entitled to meet
with Owner's approval as provided in Subsection 39.02D provided Tenant requests
Owner by six (6) months immediately following the Fifth Year Additional Space
Commencement Date to so perform Owner's Fifth Year Additional Work.
Notwithstanding anything to the contrary set forth herein, Owner shall not be
required to perform Owner's Fifth Year Additional work if such request is not
made by Tenant within such six (6) months period, time being of the essence with
respect thereto.
C. Owner's Fifth Year Additional Work required to be
performed and made by Owner pursuant to the provisions of this Section 39.02
shall be equal to standards adopted by Owner for the Building and shall
constitute a single, non-recurring obligation on the part of Owner. In the event
this Lease is renewed or extended for a further term by agreement or operation
of law, Owner's obligation to perform such work shall not apply to such renewal
or extension. In the event that Owner's Fifth Year Additional Work shall be
required to be substantially completed prior to the Fifth Year Additional Space
Commencement Date, as provided in Section 39.01C(2) then entry by Owner, or its
contractors, into the Fifth Year Additional Space to complete unfinished details
of Owner's Fifth Year Additional Work after the Fifth Year Additional Space
Commencement Date shall not constitute an actual or constructive eviction in
whole or in part or entitle Tenant to any abatement or diminution of rent or
relieve Tenant from any obligations under this Lease or impose any liability
upon Owner or its agents, provided, that Owner shall complete such unfinished
details with reasonable diligence, and shall use reasonable efforts to mitigate
interference with the operation of Tenant's business in the Fifth Year
Additional Space without any obligation to employ labor at overtime or other
premium pay rates.
D. If Tenant shall fail to deliver to Owner Tenant's
Fifth Year Additional Demolition Plans which shall be entitled to meet with
Owner's approval by the Fifth Year Plan Submission Date, then Tenant shall
accept the Fifth Year Additional Space on the Fifth Year Additional Space
Commencement Date in an "as is" "broom clean condition" and provided (i) Tenant
notifies Owner by the date six (6) months immediately following the Fifth Year
Additional Space Commencement Date (the "Fifth Year Additional Space Work
--------------------------------
Request Date") to commence the performance of Owner's Fifth Year Additional
------------
Work, and (ii) Tenant shall have submitted to Owner Tenant's Fifth Year
Additional Demolition Plans which shall be entitled to meet with Owner's
approval by the Fifth Year Additional Space Work Request Date, Owner, at Owner's
expense, shall perform Owner's Fifth Year Additional Work. Provided Tenant shall
have submitted to Owner Tenant's Fifth Year Additional Demolition Plans which
shall be entitled to meet with Owner's approval, Owner shall commence the
performance of Owner's Fifth Year Additional Work within thirty (30) days after
Tenant shall have vacated the Fifth Year Additional Space to enable Owner to
perform Owner's Fifth Year Additional Work. Tenant shall not be required to pay
any portion of the increase in the Fixed Rent allocable to the Fifth Year
Additional Space or any increases therein with respect to the period ("Fifth
-----
Year Additional Work Period") from the earlier of (a) the date, subsequent to
---------------------------
the submission by Tenant to Owner of Tenant's Fifth Year Additional Demolition
Plans which shall be entitled to meet with Owner's approval, thirty (30) days
following the date upon which Tenant has vacated the Fifth Year Additional Space
to permit Owner to perform Owner's Fifth Year Additional Work therein, or (b)
the date when Owner commences the performance of Owner's Fifth Year Additional
Work, to and including the date upon which Owner shall have substantially
completed Owner's Fifth Year Additional Work, but Tenant shall otherwise be
required to comply with all of the other terms, covenants and conditions
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of this Lease on Tenant's part to be observed or performed. If any portion
("3/rd/ Duplicative Portion") of the Fifth Year Additional Work Period occurs
-------------------------
during the Fifth Year Additional Space Rent Holiday Period, then the Fifth Year
Additional Space Rent Holiday Period shall be extended by the number of days
occurring during the 3/rd/ Duplicative Portion, to give effect to the rent
holiday set forth in the foregoing sentence.
Section 39.03. Tenant's Initial Installation. Promptly after the
-----------------------------
effective commencement date of the term applicable to the Fifth Year Additional
Space, Tenant shall, at Tenant's cost and expense, perform various Alterations
to the Fifth Year Additional Space, respectively, required for Tenant's
occupancy and use thereof and conduct of its business therein. Such Alterations
(referred to, collectively, as "Tenant's Fifth Year Initial Installation") shall
----------------------------------------
be made and performed in accordance with the provisions of this Lease,
including, without limitation, the provisions of Article 3 and Article 6 hereof.
Tenant shall prosecute Tenant's Fifth Year Initial Installation to completion
with all reasonable diligence
Section 39.04. Owner's Contribution. A. Subject to the provisions and
--------------------
requirements of Article 3, and provided that Tenant is not then in default under
any of the terms, covenants and conditions of this Lease on the part of Tenant
to be observed or performed, Owner shall contribute the sum of not more than the
product of (i) $25.00 and (ii) the number of rentable square feet set forth in
Exhibit C opposite the floor designated by Owner as the Fifth Year Additional
Space in the aggregate, toward the cost and expense actually incurred by Tenant
with respect to Tenant's Fifth Year Initial Installation including the cost of
all architectural, engineering and designers fees incurred by Tenant in
connection therewith. Owner's contribution on account of Tenant's Fifth Year
Initial Installation is referred to as "Owner's Fifth Year Work Contribution".
------------------------------------
Irrespective of the actual cost and expense of Tenant's Fifth Year Initial
Installation, in no event shall Owner's Fifth Year Work Contribution exceed the
aggregate sum of the product of (i) $25.00 and (ii) the number of rentable
square feet set forth in Exhibit C opposite the floor designated by Owner as the
Fifth Year Additional Space.
B. Provided that Tenant is not
then in default under any of the terms, covenants or conditions of this Lease on
Tenant's part to be observed and performed, Owner shall distribute Owner's Fifth
Year Work Contribution on account of Tenant's Fifth Year Initial Installation in
the same manner as Owner's distribution of Owner's Work Contribution set forth
in Section 3.10.
Section 39.05. A. In the event Owner and Tenant are unable to agree
as to the fair market annual rental rate value of the Fifth Year Additional
Option Space leased by Tenant pursuant to the provisions of this Article, such
fair market annual rental value shall be determined by arbitration as follows:
(a) Owner and Tenant shall each appoint an
arbitrator within thirty (30) days after notice by either party requesting
arbitration of the issue. If either Owner or Tenant shall have failed to appoint
an arbitrator within such period of time, then such arbitrator shall be
appointed by the American Arbitration Association, or its successor, or if at
such time such association is not then in existence, and has no successor, then
the presiding Justice of the Appellate Division, First Department, of the
Supreme Court of the State of the New York, or any successor court, upon request
of either Owner or Tenant, as the case may be.
(b) The two arbitrators appointed, as above
provided, shall select a third arbitrator and if they fail to do so within
thirty (30) days after their appointment, such third arbitrator shall be
appointed as above provided for the appointment of an arbitrator in the event
either party fails to do so.
(c) All of such arbitrators shall be real estate
appraisers or brokers having at least fifteen (15) years of experience in such
field in the Borough of Manhattan, City of New York.
(d) The three arbitrators, selected as aforesaid,
forthwith shall convene and render their decision as promptly as practicable
after the appointment of the third arbitrator. The decision of the such
arbitrators shall be in writing and the vote of the majority of them (or, if
there shall be no majority decision, then the decision of the last appointed
arbitrator) shall be the decision of all and binding upon Owner and Tenant
whether of not a judgment shall be entered in any court. Duplicate original
counterparts to such decision shall be sent by the arbitrators to both Owner and
Tenant.
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(e) The arbitrators, in arriving at their
decision, shall be entitled to consider all testimony and documentary evidence
which may be presented at any hearing as well as facts and data which the
arbitrators may discover by investigation and inquiry outside of such hearings;
the arbitrators shall be bound by the provisions of this Lease, and shall not
add to, subtract from, or otherwise modify such provisions; the cost and expense
of such arbitration shall be borne equally by Owner and Tenant, except that each
party shall pay its own counsel fees and expenses.
(f) Notwithstanding any findings of the
arbitrators, such fair market rental value from time to time per rentable square
foot, shall not be less than the Fixed Rent per rentable square foot in effect,
at the time or times in question applicable to the original portion of the
Demised Premises (before giving effect to any abatement or apportionment of such
Fixed Rent).
B. The Demised Premises Area set forth in Section
23.01 shall be increased by the number of rentable square feet set forth in
Schedule C opposite the floor designated by Owner as the Fifth Year Additional
Space.
Section 39.06. Upon request of Owner or Tenant, the parties
shall execute and deliver to the other, from time to time, an instrument or
instruments, in form reasonably satisfactory to Owner and Tenant, setting forth
all of the modifications of the Lease resulting from the operation of the
foregoing provisions of this Article including, but not limited to, the
effective commencement date of the term applicable to the Fifth Year Additional
Space;; however, neither the failure of Owner or Tenant to request the execution
of any such instrument nor Owner's or Tenant's failure to execute and deliver
any such instrument shall vitiate any of the provisions of this Article 39.
ARTICLE 40
OPTION FOR TENTH YEAR ADDITIONAL SPACE
--------------------------------------
Section 40.01. A. Provided (a) Tenant shall not then be in default
under any of the terms, covenants or conditions of this Lease on Tenant's part
to be observed or performed beyond applicable grace periods, (b) Tenant (or its
affiliates) in contradistinction to subtenants or other occupants, shall then be
in occupancy of at least sixty (60%) percent of the space leased to Tenant under
this Lease (for the purpose of this Article 40, any space leased to Tenant under
this Lease which has been eliminated from the Demised Premises pursuant to the
provisions of Section 11.03 shall be deemed space leased to Tenant under this
Lease), Tenant shall have the option exercisable only by notice given to Owner
on or prior to the date which is eight (8) years and six (6) months next
following the Additional Space Commencement Date, to lease and add to the
Demised Premises an entire floor of the Building other than the twenty-third
(23/rd/) floor, such space to be designated by Owner as hereinafter provided
(the floor so designated is referred to as the "Tenth Year Additional Space"),
upon all of the then executory terms, covenants and conditions contained in this
Lease (including, but not limited to, the provisions of Article 23), except as
otherwise provided in this Article, for a term to commence in accordance with
the provisions of subsection B of this Section, (subject to the provisions of
subsection C of this Section), and to end on the Expiration Date, unless sooner
terminated pursuant to any of the terms, covenants or conditions of this Lease
or pursuant to law.
B. In the event Tenant gives a timely notice to
Owner, in accordance with the provisions of subsection A of this Section 40.01,
exercising the option set forth herein, Owner shall give notice to Tenant
designating the location of the Tenth Year Additional Space and setting forth
the commencement date of the term applicable to the Tenth Year Additional Space
(subject to the provisions of paragraph C of this Section), which date is
referred to as the "Expected Possession Date"), and which shall be no sooner
than the date which is nine (9) years next following the Additional Space
Commencement Date and no later than the eleventh (11/th/) anniversary of the
Additional Space Commencement Date. Such notice shall be given at least six (6)
months prior to the Expected Possession Date.
C. Owner agrees that at least one (1) entire floor of
the Building other than the twenty-third (23/rd/) floor shall be subject to a
lease or leases expiring, inclusive of any renewal options during the
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period between the date which is nine (9) years following the Additional Space
Commencement Date and the date which is eleven (11) years following the
Additional Space Commencement Date. However, notwithstanding the foregoing,
Owner and Tenant acknowledge the possibility that all or any of the tenants or
occupants of the Tenth Year Additional Space may not have vacated and
surrendered all or any portions of the Tenth Year Additional Space to Owner by
the Expected Possession Date. Accordingly, notwithstanding anything to the
contrary contained in paragraph B of this Section; (a) in the event that any
tenants or occupants of the Tenth Year Additional Space have not vacated the
Tenth Year Additional Space on or before the Expected Possession Date, the term
of this Lease applicable to the Tenth Year Additional Space shall commence on
the date upon which the entire Tenth Year Additional Space shall become vacant
and Owner gives notice to Tenant of such vacancy; (b) the Expiration Date shall
not be affected thereby; (c) except as set forth in this sentence, neither the
validity of this Lease nor the obligations of Tenant under this Lease shall be
affected thereby; (d) Tenant waives any rights under Section 223-a of the Real
Property Law of New York or any successor statue of similar import to rescind
this Lease and further waives the right to recover any damages from Owner which
may result from the failure of Owner to deliver possession of the Tenth Year
Additional Space on the Expected Possession Date; (e) Owner shall institute,
within three (3) days after the Expected Possession Date, possession proceedings
against any tenants and occupants who have not vacated and surrendered all or
any portion of the Tenth Year Additional Space, and shall prosecute such
proceedings to completion with reasonable diligence.
D. On the effective commencement date of the term
applicable to the Tenth Year Additional Space, this Lease shall be deemed
modified as follows:
(i) The Demised Premises shall include the
Tenth Year Additional Space (together with
all appurtenances, fixtures, improvements,
additions and other property attached
thereto or installed therein at the
commencement of the term applicable to the
Tenth Year Additional Space or at any time
during said term, other than Tenant's
Personal Property) for all purposes of this
Lease;
(ii) The Fixed Rent shall be increased by a sum
equal to the annual rental rate determined
as provided in Section 40.02 with respect
to the period from the effective
commencement date of the term applicable to
the Tenth Year Additional Space to the
Expiration Date, both dates inclusive and
the monthly installments of the Fixed Rent
shall each be increased accordingly to
conform with such increase in the Fixed
Rent. In the event that the term applicable
to the Tenth Year Additional Space shall
commence on a date other than the first day
of any month, the monthly installment of
the Fixed Rent for the month during which
the term applicable to the Tenth Year
Additional Space shall commence shall be
equitably apportioned to reflect such
increase in the Fixed Rent.
(iii) The Demised Premises Area set forth in
Section 23.01 shall be increased by the
number of rentable square feet set forth in
Schedule C opposite the floor designated by
Owner as the Tenth Year Additional Space.
E. Tenant agrees to accept the Tenth Year Additional
Space in the condition which shall exist at the commencement of the term
applicable thereto, as is, and agrees that Owner will not be required to make
any alterations, additions, improvements or decorations thereto in order to
prepare the Tenth Year Additional Space for Tenant's occupancy except that Owner
agrees to deliver the Tenth Year Additional Space vacant and in so-called "broom
clean" condition and abate any asbestos therein as required by Legal
Requirements so as to be able to deliver to Tenant a form ACP-5 with respect to
the Tenth Year Additional Space upon Tenant's submission to Owner of plans which
are in compliance with all Legal Requirements and the provisions of this Lease.
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F. It is understood and agreed that time is of
the essence with respect to the exercise of the option set forth in subsection A
of Section 40.01, and, if Tenant does not exercise such option on or prior to
the date which is eight (8) years six (6) months next following the Additional
Space Commencement Date any notice of the exercise of such option given after
the date which is eight (8) years six (6) months next following the Additional
Space Commencement Date shall be void and of no further force and effect.
Section 40.02. A. In the event Owner and Tenant are unable to
agree as to the fair market annual rental rate value of the Tenth Year
Additional Option Space leased by Tenant pursuant to the provisions of this
Article, such fair market annual rental value shall be determined by arbitration
as follows:
(a) Owner and Tenant shall each appoint an
arbitrator within thirty (30) days after notice by either party requesting
arbitration of the issue. If either Owner or Tenant shall have failed to appoint
an arbitrator within such period of time, then such arbitrator shall be
appointed by the American Arbitration Association, or its successor, or if at
such time such association is not then in existence, and has no successor, then
the presiding Justice of the Appellate Division, First Department, of the
Supreme Court of the State of the New York, or any successor court, upon request
of either Owner or Tenant, as the case may be.
(b) The two arbitrators appointed, as above
provided, shall select a third arbitrator and if they fail to do so within
thirty (30) days after their appointment, such third arbitrator shall be
appointed as above provided for the appointment of an arbitrator in the event
either party fails to do so.
(c) All of such arbitrators shall be real
estate appraisers or brokers having at least fifteen (15) years of experience in
such field in the Borough of Manhattan, City of New York.
(d) The three arbitrators, selected as
aforesaid, forthwith shall convene and render their decision as promptly as
practicable after the appointment of the third arbitrator. The decision of the
such arbitrators shall be in writing and the vote of the majority of them (or,
if there shall be no majority decision, then the decision of the last appointed
arbitrator) shall be the decision of all and binding upon Owner and Tenant
whether of not a judgment shall be entered in any court. Duplicate original
counterparts to such decision shall be sent by the arbitrators to both Owner and
Tenant.
(e) The arbitrators, in arriving at their
decision, shall be entitled to consider all testimony and documentary evidence
which may be presented at any hearing as well as facts and data which the
arbitrators may discover by investigation and inquiry outside of such hearings;
the arbitrators shall be bound by the provisions of this Lease, and shall not
add to, subtract from, or otherwise modify such provisions; the cost and expense
of such arbitration shall be borne equally by Owner and Tenant, except that each
party shall pay its own counsel fees and expenses.
Section 40.03. A. Upon request of Owner, Tenant from time
to time, shall execute and deliver to Owner, instruments, in form reasonably
satisfactory to Owner and Tenant, stating whether or not Tenant has exercised
the option contained in Section 40.01.
B. Upon the request of Owner or Tenant, the
parties from time to time, shall execute and deliver to the other, an instrument
or instruments, in form reasonably satisfactory to Owner and Tenant, setting
forth all of the modifications to this Lease resulting from the exercise of such
option, including, but not limited to, the increases in Fixed Rent resulting
therefrom.
C. Neither the failure of Owner or Tenant
to request the execution of any such instrument nor Owner's or Tenant's failure
to execute and deliver such instrument shall vitiate any of the provisions of
this Article.
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ARTICLE 41
RIGHTS FOR ADDITIONAL OPTION SPACES
-----------------------------------
Section 41.01. Provided (a) Tenant is not then in default under any of
the terms, covenants or conditions of this Lease on Tenant's part to be observed
and performed beyond applicable grace periods, and (b) Tenant (or its
affiliates), in contradistinction to any subtenants or other occupants, shall
then be in occupancy of at least four (4) entire floors of the Building, Tenant
shall have the option, (x) during the first (1st) thirteen (13) years of the
Demised Term, and (y) at any time during the period, if any, commencing as of
the date Tenant exercises the renewal option set forth in Article 42 in
accordance with the provisions thereof, and ending on the seventh (7/th/)
anniversary of the original Expiration Date (as hereinafter defined) subject to
the provisions of this Article, exercisable in accordance with the provisions of
Section 41.02, to lease and add to the Demised Premises any space in the
Building other than any ground floor space which after the initial leasing by
Owner of such space, becomes, or is about to become, available for leasing
during the Demised Term. No such space shall be deemed "available for leasing"
---------------------
if any other tenant in the Building as of the date of this Lease or any assignee
or successor of such other tenant, shall exercise any contractual option or
right which it or its predecessor has to lease such space (whether such space is
specifically referred to in any such contractual option or right or Owner must
use such space in order to satisfy such contractual option or right). Owner
represents to Tenant that as of the date of this Lease no tenant of the Building
has any option under its lease to lease additional space not affected by such
lease as of the date hereof.
Section 41.02. In the event that any such space shall become or about
to become available for leasing in accordance with the provisions of Section
41.01, Owner shall give notice thereof to Tenant (any such notice is referred to
as an "Availability Notice"), which Notice may be given not earlier than
-------------------
eighteen (18) months prior to the date set forth in such Notice on which such
space is expected to become vacant and available for leasing and, in such event,
Tenant shall have the option, exercisable only by notice given to Owner within
thirty (30) days next following the date of the giving of such Availability
Notice to lease and add any full floor or floors of such space to the Demised
Premises (provided that (x) if such space comprises less than a full floor,
Tenant must lease the entire such space (y) if such space comprises more than
two (2) contiguous floors, Tenant must lease the end floor (i.e. the top or
bottom floor of such space) and, at Tenant's option, Tenant may lease any other
full floor or floors which are contiguous to each other and the end floor leased
by Tenant and (z) from and after the fifteenth (15/th/) anniversary of the
Additional Space Commencement Date Tenant must lease all of such space that is
included within a lease made with an existing tenant (and may not lease less
than all such space) (any such space is referred to as an "Additional Option
-----------------
Space"; any such date set forth in an Availability Notice is referred to as an
-----
"Applicable Expected Vacancy Date"; and any notice given by Tenant to Owner
--------------------------------
exercising any such option is referred to as an "Additional Option Notice"). In
------------------------
the event that any Additional Option Space shall become available for leasing
sooner than the Applicable Expected Vacancy Date because of the termination of
the term of the lease affecting such space as a result of the occurrence of an
event of default thereunder, or a voluntary agreement to surrender resulting
from the imminent bankruptcy of the tenant thereof, as opposed to the expiration
of said lease prior to its original expiration date, Owner shall have the right
to accelerate the Applicable Expected Vacancy Date by not less than forty-five
(45) days' prior notice to Tenant. Owner shall accompany any Availability Notice
with a plan designating the location and size of the Additional Option Space.
Any such space shall be leased and added to the Demised Premises at an annual
rental rate equal to the fair market annual rental value of the applicable
Additional Option Space on the commencement date of the term applicable thereto,
as determined by agreement between Owner and Tenant or by arbitration in
accordance with the provisions of Section 41.07 and such Additional Option Space
shall otherwise be leased and added to the Demised Premises upon the same
executory terms, covenants and conditions as are contained in this Lease
(including, but not limited to, the definitions of Base Operating Expenses set
forth in Section 23.01 and Owner's Basic Tax Liability set forth in Section
23.01)) except as otherwise provided in this Article, adjusted to reflect (x)the
number of rentable square feet contained in the applicable Additional Option
Space, (determined in the same manner as the rentable square feet were
determined in the original portion of the Demised Premises), and (y) that the
term shall commence on the Applicable Expected Vacancy Date, as the same may
have been accelerated by Owner pursuant to the provisions of this Section 41.02,
subject, however, to the provisions of Section 41.03.
Section 41.03. Owner and Tenant acknowledge the possibility that all
or any of the tenants or occupants of any Additional Option Space may not have
vacated and surrendered all or any portions of the Additional
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Option Space to Owner by the Applicable Expected Vacancy Date. Accordingly,
notwithstanding anything to the contrary contained in Sections 41.01 or 41.02 or
in any Availability Notice, (a) the term of this Lease applicable to the
Additional Option Space in question shall commence (i) on the Applicable
Expected Vacancy Date with respect to those portions, if any, of the Additional
Option Space which are vacant on the Applicable Expected Vacancy Date, and (ii)
with respect to those portions, if any, of the Additional Option Space which are
not vacant on the Applicable Expected Vacancy Date, on the respective later date
or dates upon which such portions of the Additional Option Space become vacant
and Owner gives notice to Tenant of such vacancy; (b) the Expiration Date shall
not be affected thereby; (c) the increases in the Fixed Rent, the Demised
Premises Area, and all other modifications of this Lease resulting from the
application of the provisions of this Article shall be equitably adjusted to
reflect the fact that all or any portions of the Additional Option Space have
not been leased and added to the Demised Premises on the Applicable Expected
Vacancy Date but are leased and added to the Demised Premises on a date or dates
after the Applicable Expected Vacancy Date; (d) except as set forth in this
sentence, neither the validity of this Lease nor the obligations of Tenant under
this Lease shall be affected thereby; (e) Tenant waives any rights under Section
223-a of the Real Property Law of New York or any successor statute of similar
import to rescind this Lease and further waives the right to recover any damages
against Owner which may result from the failure of Owner to deliver possession
of all or any portions of the Additional Option Space on the Applicable Expected
Vacancy Date; and (f) Owner shall institute, within three (3) days after the
Applicable Expected Vacancy Date, possession proceedings against any tenants or
occupants who have not vacated and surrendered all or any portion of the
Additional Option Space, and shall prosecute such proceedings to completion with
reasonable diligence.
Section 41.04. It is understood and agreed that time is of the essence
with respect to the exercise of any option pursuant to this Article and that if
Tenant does not exercise such option within the time limitation set forth in
Section 41.02, any notice purporting to exercise such option given after the
expiration of such time limitation shall be void and of no force and effect and
Tenant thereafter shall have no further right to lease as additional space the
space which was the subject of the Availability Notice in question.
Section 41.05. In the event that Tenant shall timely exercise any
option set forth in this Article then, on the effective commencement date of the
term applicable to any Additional Option Space, this Lease shall be deemed
modified as follows:
A. The Demised Premises shall include the Additional
Option Space (together with all appurtenances, fixtures, improvements, additions
and other property attached thereto or installed therein upon the commencement
of the term applicable to the Additional Option Space or at any time during said
term, other than Tenant's Personal Property) for all purposes of this Lease.
B. The Fixed Rent shall be increased by the fair
market annual rental value for the Additional Option Space as of the effective
commencement date of the term applicable thereto as determined by agreement
between Owner and Tenant or by arbitration as provided in Section 41.07 with
respect to the period from the effective commencement date of the term
applicable to the Additional Option Space to the Expiration Date, both dates
inclusive and the monthly installments of the Fixed Rent shall each be increased
accordingly to conform with such increase in the Fixed Rent. In the event that
the term applicable to the Additional Option Space shall commence on a date
other than the first day of any month, the monthly installment of the Fixed Rent
for the month during which the term applicable to the Additional Option Space
shall commence shall be equitably apportioned to reflect such increase in the
Fixed Rent;
C. The Demised Premises Area set forth in Section
23.01, shall be increased by the number of rentable square feet set forth in
Schedule C opposite the floor designated by Owner as the Additional Option
Space.
D. If, by the effective commencement date of the term
applicable to the Additional Option Space, the Fixed Rent applicable thereto has
not yet been determined, Tenant shall, until such determination, pay for the
Additional Option Space the same Fixed Rent per rentable square foot then
allocable to the original portion of the Demised Premises, and following any
such determination there shall be a reconciliation between Owner and Tenant and
Tenant agrees to pay any underpayment to Owner within thirty (30) days of such
determination
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or Owner agrees to apply any overpayment to the monthly installment of Fixed
Rent next following the date of such determination, as the case may be.
Section 41.06. Tenant agrees to accept the Additional Option Space in
the condition which shall exist on the commencement date of the term applicable
thereto "as is" and further agrees that Owner shall have no obligation to
perform any work or make any installations in order to prepare such space for
Tenant's occupancy except that Owner agrees to deliver the Additional Option
Space vacant and in so-called "broom clean" condition and abate any asbestos
therein as required by Legal Requirements so as to be able to deliver Tenant a
form ACP-5 with respect to the Additional Option Space upon Tenant's submission
to Owner of plans which are in compliance with Legal Requirements and the
provisions of this Lease.
Section 41.07. In the event Owner and Tenant are unable to agree as to
the fair market annual rental value of the Additional Option Space, then, upon
the demand of either Owner or Tenant, such fair market annual rental value shall
be determined by arbitration as follows;
(a) Owner and Tenant shall each appoint an arbitrator
within thirty (30) days after notice by either party requesting arbitration of
the issue. If either Owner or Tenant shall have failed to appoint an arbitrator
within such period of time, then such arbitrator shall be appointed by the
American Arbitration Association, or its successor, or if at such time such
association is not in existence and has no successor, then by the presiding
Justice of the Appellate Division, First Department, of the Supreme Court of the
State of New York, or any successor court, upon request of either Owner or
Tenant, as the case may be.
(b) The two arbitrators appointed, as above provided,
shall select a third arbitrator and if they fail to do so within thirty (30)
days after their appointment, such third arbitrator shall be appointed as above
provided for the appointment of an arbitrator in the event either party fails to
do so.
(c) All of such arbitrators shall be real estate
appraisers or brokers having at least fifteen (15) years of experience in such
field in the Borough of Manhattan, City of New York.
(d) The three arbitrators, selected as aforesaid,
forthwith shall convene and render their decision as promptly as practicable
after the appointment of the third arbitrator. The decision of such arbitrators
shall be in writing and the vote of the majority of them (or, if there be no
majority decision, then the decision of the last appointed arbitrator) shall be
the decision of all and binding upon Owner and Tenant whether or not a judgment
shall be entered in any court. Duplicate original counterparts of such decision
shall be sent by the arbitrators to both Owner and Tenant.
(e) The arbitrators, in arriving at their decision,
shall be entitled to consider all testimony and documentary evidence which may
be presented at any hearing as well as facts and data which the arbitrators may
discover by investigation and inquiry outside of such hearings. The arbitrators
shall be bound by the provisions of this Lease, and shall not add to, subtract
from, or otherwise modify such provisions. The cost and expense of such
arbitration shall be borne equally by Owner and Tenant, except that each party
shall pay its own counsel fees and expenses.
Section 41.08. A. Upon request of Owner or Tenant, the parties from
time to time, shall execute and deliver to the other, instruments, in form
reasonably satisfactory to the parties, stating whether or not Tenant has
exercised any right to lease any Additional Option Space pursuant to the
provisions of this Article.
B. Upon the request of Owner or Tenant, the parties
from time to time, shall execute and deliver to the other, instruments, in form
reasonably satisfactory to the parties, setting forth all of the modifications
to this Lease resulting from the exercise of any such option, including, but not
limited to, the increases in the Fixed Rent resulting therefrom.
C. Neither the failure of Owner or Tenant to request
the execution of any such instrument nor Owner's or Tenant's failure to execute
and deliver such instrument shall vitiate any of the provisions of this Article.
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ARTICLE 42
TENANT'S SINGLE OPTION TO RENEW
-------------------------------
Section 42.01. Provided (a) Tenant is not then in default under any of
the terms, covenants or conditions of this Lease on Tenant's part to be observed
or performed beyond the applicable grace periods and (b) Tenant (or its
affiliates), in contradistinction to subtenants or other occupants, shall then
be in occupancy of at least sixty (60%) percent of the space leased to Tenant
under this Lease (for the purpose of this Article 42 any space leased to Tenant
under this lease which has been eliminated from the Demised Premises pursuant to
the provisions of Section 11.03 shall be deemed space leased to Tenant under
this Lease),Tenant shall have the option to renew this Lease and the Demised
Term for a single renewal term of ten (10) years (referred to herein as the
"Renewal Term") commencing the date next following the Expiration Date referred
------------
to in Article 1 and ending on the tenth (10th) anniversary of the Expiration
Date, unless sooner terminated pursuant to the provisions of this Lease or
pursuant to law (referred to as the "Extended Expiration Date"). If Tenant
------------------------
exercises such option in accordance with the provisions and limitations of this
Article, this Lease and the Demised Term shall be renewed for such Renewal Term:
(i) upon an annual rental rate equal to the fair market annual rental value of
the Demised Premises as of the first day of the Renewal Term, as determined by
agreement between Owner and Tenant or by arbitration in accordance with the
provisions of Section 42.02, and (ii) except as hereinafter provided, upon all
of the other then executory terms, covenants and conditions contained in this
Lease (including, but not limited to, the definition of "Owner's Basic Tax
Liability" and "Base Operating Expenses" set forth in Section 23.01) and the
Expiration Date shall be deemed extended to the Extended Expiration Date.
Section 42.02. The option set forth in Section 42.01.A.(1) may only be
exercised by notice given by Tenant to Owner on or prior to the date (referred
to as the "Renewal Option Notice Date") eighteen (18) months immediately
--------------------------
preceding the original Expiration Date. Time is of the essence with respect to
the exercise of such option. Tenant shall not have the right to give any such
notice after the Renewal Option Notice Date, and any notice given after the
Renewal Option Notice Date purporting to exercise such option shall have no
force and effect.
Section 42.03. In the event Owner and Tenant are unable to agree as to
the fair market annual rental value of the Demised Premises pursuant to Section
42.01, such fair market annual rental value shall be determined by arbitration,
as follows:
(a) Owner and Tenant shall each appoint an arbitrator
within thirty (30) days after notice by either party requesting arbitration of
the issue. If either Owner or Tenant shall have failed to appoint an arbitrator
within such period of time, then, upon request of either Owner or Tenant, as the
case may be, such arbitrator shall be appointed by the American Arbitration
Association, or its successor, or if at any time such association is not in
existence and has no successor, then, by the Presiding Justice of Appellate
Division, First Department, of the Supreme Court of the State of New York, or
any successor court.
(b) The two arbitrators appointed as above provided,
shall select a third arbitrator and if they fail to do so within thirty (30)
days after their appointment, such third arbitrator shall be appointed as above
provided for the appointment of an arbitrator in the event either party fails to
do so.
(c) All of such arbitrators shall be commercial real
estate appraisers or brokers having at least fifteen (15) years of experience in
such field in the Borough of Manhattan, City of New York.
(d) The three arbitrators, selected as aforesaid,
forthwith shall convene and render their decisions as promptly as practicable
after the appointment of the third arbitrator. The decision of such arbitrators
shall be in writing and the vote of the majority of them (or, if there shall be
no majority decision, then the decision of the last appointed arbitrator) shall
be the decision of all and binding upon Owner and Tenant whether or not a
judgment shall be entered in any court. Duplicate original counterparts of such
decision shall be sent by the arbitrators to both Owner and Tenant.
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(e) The arbitrators, in arriving at their decision,
shall be entitled to consider all testimony and documentary evidence which may
be presented at any hearing as well as facts and data which the arbitrators may
discover by investigation and inquiry outside of such hearings; the arbitrators
shall be bound by the provisions of this Lease, and shall not add to, subtract
from, or otherwise modify such provisions; the cost and expense of such
arbitration shall be borne equally by Owner and Tenant, except that each party
shall pay its own counsel fees and expenses.
Section 42.04. Tenant, upon request of Owner, from time to time, will
execute and deliver to Owner an instrument in form reasonably satisfactory to
Owner stating whether or not Tenant has exercised either the options contained
in the provisions of Section 42.01.
ARTICLE 43
NAME OF BUILDING
----------------
Section 43.01. Owner agrees to name the Building "BlackRock", or any
---------
other name which essentially consists of the then corporate name of Blackrock,
Inc. ("Blackrock"), throughout the Demised Term. However, Owner shall have the
right to change the name of the Building, and the provisions of the first
sentence of this Section shall be without force and effect from and after any
date when Tenant, it subsidiaries and affiliates, in contradistinction to any
subtenants or other occupants which are not subsidiaries or affiliates of
Tenant, are no longer in actual occupancy of at least eight (8) floors of the
Building.
Section 43.02. As long as the Building is named "BlackRock" or after
---------
the then corporate name of Blackrock, Tenant, at Tenant's sole cost, expense and
risk, to the extent permitted by Legal Requirements and subject in all respects
to the provisions of this Lease, may install and maintain signs on the interior
and exterior of the Building, respectively on both the 51/st/ and 52/nd/ Street
entrances, and in the Building's lobby above a reception desk setting forth the
name of the Building and Tenant's logo (all such signs are referred to,
collectively, as "Tenant's Signs" all as shown on Exhibit 8). The exact location
of Tenant's Signs and their design, size, color, materials and method of
installation shall be subject to the reasonable approval of Owner based on
consultation with its architect. In no event shall Tenant's Signs be
illuminated. Tenant, at Tenant's sole cost and expense, shall keep Tenant's
Signs in good order and condition and make all repairs and replacements to the
Building, ordinary or extraordinary, structural or otherwise, foreseen or
unforeseen, as may be necessitated or occasioned in whole or in part, by the
installation or maintenance of Tenant's Signs. Tenant, at Tenant's sole cost and
expense, shall comply with Legal Requirements relating to the installation or
maintenance of Tenant's Signs which may impose any duty upon Owner or Tenant
with respect to the Building. In addition to complying with the other provisions
of this Lease, Tenant covenants that Tenant's Signs shall be installed and
maintained in accordance with the provisions of Article 3 notwithstanding that
Tenant's Signs shall not be in or about the Demised Premises. On the date upon
which the Demised Term shall expire and come to an end, or on any earlier date
upon which Owner has the right, pursuant to the provisions of Section 43.01, to
change the name of the Building, Tenant, at Tenant's sole cost and expense,
shall promptly remove Tenant's Signs from the Building and repair all damage to
the Building which may have been occasioned by such removal. Tenant's
obligations under this Section shall survive the expiration or sooner
termination of the Demised Term. If Tenant is unable for any reason to install
or maintain Tenant's Signs, or if Tenant is required by Legal Requirements to
remove Tenant's Signs, or if Tenant's Signs shall be damaged by reason of fire,
casualty, the elements or any other cause, whether or not similar to those
hereinabove enumerated, no such inability, removal or damage shall constitute an
actual or constructive eviction, in whole or in part, or entitled Tenant to any
abatement, diminution of rent, or relieve Tenant of its obligations under this
Lease, or impose any liability upon Owner or its agents.
Section 43.03. Owner covenants to Tenant that it shall not permit any
tenant of the Building to install its name in the lobby of the Building or on
the exterior of the Building during the Demised Term other than (i) on a
building directory or (ii) retail tenants which shall be permitted to have their
name and/or logo on the exterior of the Building but no higher than the floor of
the tenant occupying the space on the floor directly above such retail tenant.
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ARTICLE 44
MEMORANDUM OF LEASE
-------------------
Section 44.01. At the request of Tenant, Owner and Tenant shall
execute and deliver to each other a short form or memorandum of this Lease for
the purpose of recording the interest of Tenant in the Demised Premises, said
short form or memorandum of lease to be in form reasonably satisfactory to Owner
and Tenant. In the event the parties shall execute and deliver such short form
or memorandum of lease, its shall under no circumstances be deemed to modify or
change any of the provisions of this Lease, which provisions shall, in all
instances prevail. Upon the execution or any sooner termination of the Demised
Term, Tenant shall execute and deliver to Owner an agreement, in form reasonably
satisfactory to Owner, for the purpose of recording such expiration or sooner
termination of the Demised Term and the expunging from the records the interest
of Tenant in the Demised Premises and the Building. If Tenant shall fail to
execute such agreement within a reasonable time, Tenant hereby irrevocably
constitutes and appoints Owner as Tenant's agent and attorney-in-fact to execute
such agreement. Owner and Tenant agree that neither of them shall record, or
cause to be recorded, this Lease.
ARTICLE 45
ACCELERATION OF ADDITIONAL SPACES
---------------------------------
Section 45.01. A. Tenant has advised Owner that Tenant would like
the option to lease and add to the Demised Premises any full floors of the
Additional Space leased by Tenant pursuant to the provisions of Article 38 prior
to the date upon which Tenant would otherwise lease such floor(s) pursuant to
the provisions of Article 38. Accordingly, in the event that Owner receives a
notice from the Present Occupant that it intends to sublet any full floor or
floors of the Additional Space in accordance with the provisions of its lease,
Owner shall notify Tenant thereof by a notice ("Intention Notice") delivered to
Tenant only by a nationally recognized overnight courier providing dated
evidence of receipt or refusal ("Accepted Courier"). The Intention Notice shall
state the full floor or floors of the Additional Space in question and the
date(s) upon which the Present Occupant wishes to commence its subletting
thereof. Within fifteen (15) days after the delivery of the Intention Notice,
Tenant shall notify Owner only by Accepted Courier, whether Tenant elects to
have Owner recapture all or any of the full floor Additional Space(s) set forth
in the Intention Notice (any such notice by Tenant to Owner is referred to as an
"Exercise Notice"). Time is of the essence with respect to the delivery of any
Exercise Notice. If Tenant fails to give an Exercise Notice within such fifteen
(15) day period, any Exercise Notice given by Tenant to Owner thereafter
purporting to exercise such option to accelerate the leasing of the Additional
Space(s) in question shall be of no force and effect and Tenant shall have no
right to accelerate the leasing of such Additional Space(s).
B. In the event that Tenant timely exercises the
option to accelerate the leasing of any Additional Space(s) on such earlier
date(s) in accordance with the foregoing provisions of this Article, Owner shall
send a notice to the Present Occupant recapturing the Additional Space(s) in
question which Tenant desires to so lease earlier, and the Demised Term
applicable to such Additional Space(s) shall commence on the date(s) upon which
the Present Occupant shall have so vacated and surrendered such Additional
Space(s) to Owner, and all of the terms, covenants and conditions of this Lease
shall be applicable to such accelerated Additional Space(s) with the increase in
the Fixed Rent and the increase in the Demised Premises Area set forth in
Article 38 equitably apportioned on the basis of square footage determinations
set forth in Schedule C annexed to and made a part of this Lease, except that
Tenant shall take occupancy of such Additional Space(s) in question in their "as
is" and "broom clean" condition and the Additional Space Commencement Date for
the purpose of fixing the Expiration Date shall be deemed to be the commencement
date of the Demised Term applicable to the last floor of the Additional Space
leased. Owner agrees that, provided Tenant notifies Owner to commence Owner's
Additional Work applicable to the Additional Space(s) in question on or before
the later of September 1, 2002 or sixty (60) days after Owner delivers such
space to Tenant, then Owner, at Owner's expense, shall perform such portion of
Owner's Additional Work applicable thereto and Tenant shall not be required to
pay any portions of the Fixed Rent and increases therein pursuant to Article 23
applicable to the Additional Space(s) in which Owner is performing Owner's
Additional Work with respect to the period ("Alternate Rent Holiday Period")
from the date upon which Owner enters such Additional Space(s) to perform such
work, to and including, the date upon which Owner substantially completes such
work with the Alternate Rent Holiday Period to be the same period as the
applicable portion of the Additional Work Period (referred to in Section
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38.03D) applicable to the Additional Space(s) in question and with Tenant
entitled to the benefits of the last sentence of Section 38.03D. During the
period that Owner shall be performing Owner's Additional Work in any Additional
Space(s), Tenant shall vacate such Additional Space(s) to permit Owner to
perform such work without interference by Tenant.
ARTICLE 46
GENERATOR SPACE
---------------
Section 46.01. Tenant acknowledges that Reuters America, Inc., a
---------------------
tenant in the Building, has leased a portion of the mezzanine of the Building in
which it has installed a generator and a portion of the basement in the Building
in which it has installed a diesel tank (the "Reuter's Tank"). Such space is
indicated on the floor plan initialed by the parties, annexed hereto and made a
part hereof as Exhibit 9 and is referred to, collectively, as the "Generator
---------
Space"; and the generator installed therein is referred to as the Reuters
----- -------
Generator. Provided (a) Tenant is not then in default under any of the terms,
---------
covenants or conditions of this Lease on Tenant's part to be observed and
performed beyond applicable grace periods, and (b) Tenant (or its affiliates) in
contradistinction to any subtenants or other occupants, shall then be in
occupancy of at least four (4) entire floors in the Building, Tenant shall have
the option to lease the Generator Space, and the Reuter's Generator and Reuter's
Tank therein as provided in this Article.
Section 46.02. In the event that the Generator Space shall become or
is about to become available for leasing, Owner shall give notice ("Generator
---------
Availability Notice") to Tenant which may be given not earlier than twelve (12)
-------------------
months prior to the date set forth in such notice on which such space is
expected to become vacant and available for leasing and, in such event, Tenant
shall have the option, exercisable only by notice to Owner, within thirty (30)
days next following the date of such Generator Availability Notice to lease and
add the Generator Space to the Demised Premises. Any such date set forth in the
Generator Availability Notice is referred to as the "Generator Expected Vacancy
--------------------------
Date"; and any notice given by Tenant to Owner exercising such option is
----
referred to as the "Generator Option Notice". In the event that the Generator
-----------------------
Space shall become available for leasing sooner than the Generator Expected
Vacancy Date because of the termination of the term of the lease affecting such
space as the result of the occurrence of an event of default thereunder, or a
voluntary agreement to surrender resulting from the imminent bankruptcy of the
tenant thereunder, as opposed to the expiration of said lease prior to its
original expiration date, Owner shall have the right to accelerate the Generator
Expected Vacancy Date by not less than forty-five (45) days prior notice to
Tenant. The Demised Term of this Lease applicable to the Generator Space shall
commence on the date upon which the present tenant thereof vacates and surrender
such space to Owner, whether such date occur prior to, or after, the Generator
Expected Vacancy Date, subject to the provisions of the immediately preceding
sentence. Accordingly, in the event that the present tenant thereof fails to
vacate and surrender the Generator Space to Owner by the Generator Expected
Vacancy Date: (i) the Demised Term of this Lease applicable to the Generator
Space shall not commence on the Generator Expected Vacancy Date, but shall
instead, commence on the later date upon which such present tenant so vacates
and surrenders the Generator Space to Owner, and (ii) the Expiration Date shall
not be affected thereby, (iii) except as set forth in this sentence, neither the
validity of this Lease nor the obligation of Tenant hereunder shall be affected
thereby, (iv) Tenant waives any right under such 223-a of the New York Real
Property Law or any successor law to rescind this Lease or its obligations with
respect to this Lease, (v) Tenant waives any right to recover any damages which
may result from the failure of Owner to deliver possession of the Generator
Space on the Generator Expected Vacancy Date, and (vi) Owner, upon Tenant's
request shall commence and prosecute with reasonable diligence possession
proceedings against said tenant holding over.
Section 46.03. It is understood and agreed that time is of the essence
with respect to the exercise of the option pursuant to this Article and that if
Tenant does not exercise such option within the time limitation set forth in
Section 46.02, any notice purporting to exercise such option given after the
expiration of such time limitation shall be void and of no force and effect and
Tenant thereafter shall have no further right to lease the Generator Space.
Section 46.04. In the event that Tenant shall timely exercise the
option for the Generator Space, on the effective commencement date of the
Demised Term applicable to the Generator Space, this Lease shall be deemed
modified as follows:
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A. The Basement Space shall include the Generator
Space (together with all appurtenances, fixtures, improvements, additions and
other property attached thereto or installed therein on said effective
commencement date of the Demised Term applicable to the Generator Space, other
than Tenant's Personal Property) for all purposes of this Lease, except Owner
shall have no obligation to provide any services to the Generator Space.
B. (i) Fixed Rent shall be increased by the
following annual rental rates:
1. SIXTY-TWO THOUSAND FIVE HUNDRED and 00/100
($62,500) DOLLARS per annum with respect to any portion of the Demised Term
applicable to the Generator Space occurring during the First Rent Period;
2. SIXTY-SEVEN THOUSAND FIVE HUNDRED and 00/100
($67,500) DOLLARS per annum with respect to any portion of the Demised Term
applicable to the Generator Space occurring during the Second Rent Period; and
3. SEVENTY-THREE THOUSAND SEVEN HUNDRED FIFTY
and 00/100 ($73,750) DOLLARS per annum with respect to any portion of the
Demised Term applicable to the Generator Space occurring during the Third Rent
Period.
(ii) The monthly installments of the Fixed Rent
shall be increased accordingly to reflect
the foregoing increases in the Fixed Rent.
C. The Demised Premises Area set forth in Section
23.01 shall not be increased by reason of the leasing of the Generator Space as
escalation payments are not payable with respect to the Generator Space.
Section 46.05. Tenant acknowledges that Owner has made no
representations to Tenant with respect to the condition of the Generator Space
and Tenant agrees to accept possession of the Generator Space in the condition
which shall exist on the effective commencement date of the Demised Term
applicable thereto "as is" and further agrees that Owner shall have no
obligation to perform any work or make any installations in order to prepare the
Generator Space for Tenant's occupancy.
Section 46.06. Owner shall assign to Tenant, without recourse, on the
effective commencement date of the Demised Term applicable to the Generator
Space any rights Owner has in and to the Reuter's Generator and Reuter's Tank
existing therein and Tenant, at Tenant's sole cost and expense, may make all
repairs and replacements thereto and to any replacements thereof as and when
necessary and Owner shall have no responsibility therefor and Tenant shall
indemnify and hold Owner harmless of and from all loss, cost, liability, damage
and expense, including, but not limited to, reasonable counsel fees and
disbursements arising from the maintenance, operation, repair, replacement and
removal of the Reuter's Generator or Reuter's Tank and any other generator in
the Generator Space. The Reuter's Generator or any other generator in the
Generator Space and Reuter's Tank shall remain the the Building on the
Expiration Date or sooner termination of the Demised Term, and all such
installations shall become the property of Owner at no cost and expense to Owner
or Tenant. Tenant shall during the Demised Term comply with all rules and
regulations with respect to any generator as may be reasonably imposed by Owner.
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Section 46.07. Upon request of Owner, Tenant will execute, acknowledge
and deliver to Owner an instrument, in form reasonably satisfactory to Owner,
stating whether or not Tenant has exercised the option set forth in this Article
and setting forth the effective commencement date of the Demised Term applicable
to the Generator Space. Failure of Tenant to execute and deliver any such
instrument shall not vitiate the foregoing provisions of this Article.
IN WITNESS WHEREOF, Owner and Tenant have respectively signed and
sealed this Lease as of the day and year first above written.
40 EAST 52ND STREET L.P.,
By 40 EAST 52ND STREET LLC, general partner
Witness:
By: /s/ Lewis Rudin Owner
------------------ -------------------------------------
Name: Lewis Rudin
Title: Managing Member
BLACKROCK, INC.
Witness:
Attest:
_______________________ By: /s/ Paul L. Audet Tenant
-----------------------------------
Name: Paul L. Audet
Title: Managing Director
89