New York-New York-420 Lexington Avenue Lease - SLG Graybar Sublease LLC and Fusion Telecommunications International Inc.
Lease made as of the day of 2000, between SLG
Graybar Sublease LLC, a New York limited liability company having an office at
420 Lexington Avenue, New York, New York 10170 Hereinunder referred to as
"Landlord" or "Lessor," and Fusion Telecommunications International, Inc. a
corporation having an office at 15 Exchange Place, Jersey City, New Jersey,
07302. hereinafter referred to as "Tenant" or "Lessee."
Withnesseth: Landlord hereby leases to Tenant and Tenant hereby hires from
Landlord Rooms 518-25 on the fifth (5th) floor of the Building approximately as
indicated in the plan attached hereto and made a part thereof (said space is
hereinafter called the "Premises") in the building known as The Graybar
Building, 420 Lexington Avenue (the "Building") In the County of New York , City
of New York, for a term of ten (10) years to commence on: See Article 55, or
until such term shall sooner end as in Article 12 and elsewhere herein provided,
both dates inclusive, at a fixed annual rental (subject to Articles 23{REMOVED}
and 40) at the annual rate of: See rent schedule attached hereto and made a part
hereof as Exhibit A payable in equal monthly installments in advance on the
first (1st) day of each moth, except that the first installment of rent due
under this Lease shall be paid by Tenant upon its execution of this Lease,
unless this Lease be a renewal.
Landlord and Tenant covenant and agree:
PURPOSE.
1. Tenant shall use and occupy the Premises only for offices relating to
Tenant's business, and for no other purpose.
RENT AND ADDITIONAL RENT.
2. Tenant agrees to pay rent as herein provided at the office of Landlord
or such other place as Landlord may designate, payable in United States legal
tender, by cash, or by good and sufficient check drawn on a New York City
Clearing House Bank, and without any set off or deduction whatsoever except as
otherwise set forth herein. Any sum other than fixed rent payable hereunder
shall be deemed additional rent and due on demand.
ASSIGNMENT.
3. Neither Tenant nor Tenant's legal representatives or successors in
interest by operation of law or otherwise, shall assign, mortgage or otherwise
encumber this Lease, or sublet or permit all or part of the Premises to be used
by others, without the prior written consent of Landlord in each instance. The
transfer of a majority of the issued and outstanding capital stock of any
corporate tenant or sublessee of this Lease or a majority of the total interest
in any partnership Tenant or sublessee, however accomplished, and whether in a
single transaction or in a series of related or unrelated transactions, and the
conversion of a tenant or sublessee entity to either a limited liability company
or a limited liability partnership shall be deemed as assignment of this Lease
or of such sublease. The merger or consolidation of a corporate tenant or
sublessee where the net worth of the resulting corporation is less than the net
worth of the Tenant or sublessee immediately prior to such merger or
consolidation shall be deemed an assignment of this Lease or of such sublease.
If without Landlord's written consent this Lease is assigned, or the Premises
are sublet or occupied by anyone other than the Tenant, Landlord may accept the
rent from such assignee, subtenant or occupant, and apply the net amount thereof
to the rent herein reserved, but no such assignment, subletting, occupancy or
acceptance of rent shall be deemed a waiver of this covenant. Consent by
Landlord to an assignment or subletting shall not relieve Tenant from the
obligation to obtain Landlord's written consent to any further assignment or
subletting. In no event shall any permitted sublessee assign or encumber its
sublease or further sublet all or any portion of its sublet space, or otherwise
suffer or permit the sublet space or any part thereof to be used or occupied by
others, without Landlord's prior written consent in each instance. A
modification, amendment or extension of a sublease shall be deemed a sublease.
DEFAULT
4. Landlord may terminate this Lease on five (5) days' notice: (a) if rent
or additional rent is not paid within five (5) days after written notice from
Landlord; or (b) if Tenant shall have failed to cure a default in the
performance of any covenant of this Lease (except the payment of rent), or any
rule or regulation hereinafter set forth, within thirty (30) days after written
notice thereof from Landlord, or if default cannot be completely cured in such
time, if Tenant shall not promptly proceed to cure such default within said
thirty (30) days, or shall not complete the curing of such default with due
diligence; or (c) when and to the extent permitted by law, if a petition in
bankruptcy shall be filed by or against Tenant or if Tenant shall make a general
assignment for the benefit of creditors, or receive the benefit of any
insolvency or reorganization act; or (d) if a receiver or trustee is appointed
for any portion of Tenant's property and such appointment is not vacated within
(30) days; or (e) if an execution or attachment shall be issued under which the
Premises shall be taken or occupied or attempted to be taken or occupied by
anyone other than Tenant; or (f) if the Premises become abandoned; or (g) if
Tenant shall default beyond any grace period under any other lease between
Tenant and Landlord.
At the expiration of the five (5) day notice period, this Lease and any
rights or renewal or extension thereof shall terminate as completely as if that
were the date originally fixed for the expiration of the term of this Lease, but
Tenant shall remain liable as hereinafter provided.
RELETTING, ETC.
5. If Landlord shall re-enter the Premises on the default of Tenant, after
notice and beyond the expiration of any applicable cure period set forth herein,
by summary proceeding or otherwise: (a) Landlord may re-let the Premises or any
part thereof as Tenant's agent, in the name of Landlord, or otherwise, for a
term shorter or longer than the balance of the term of this Lease, and may grant
concession of free rent. (b) Tenant shall pay Landlord any deficiency between
the rent hereby reserved and the net amount of any rents collected by Landlord
for the remaining term of this Lease, through such re-letting. Such deficiency
shall become due and payable monthly, as it is determined. Landlord shall have
no obligation to re-let the Premises, and its failure or refusal to do so, or
failure to collect rent on re-letting, shall not affect Tenant's liability
hereunder. In computing the net amount of rents collected through such
re-letting, Landlord may deduct all expenses incurred in obtaining possession or
re-letting the Premises, including legal expenses and fees, brokerage fees, the
cost of restoring the Premises to good order, and the cost of all alterations
and decorations deemed necessary by Landlord to affect re-letting. In no event
shall Tenant be entitled to a credit or repayment for re-rental income which
exceeds the sums payable by Tenant hereunder or which covers a period after the
original term of this Lease. (c) Tenant hereby expressly waives any right of
redemption granted by any present or future law. "Re-enter" and "re-entry" as
used in this Lease are not restricted to their technical legal meaning. In the
event of a breach or threatened breach of any of the covenants or provisions
hereof, Landlord shall have the right of injunction. Mention herein of any
particular remedy shall not preclude Landlord form any other available remedy.
(d) Landlord shall recover as liquidated damages, in addition to accrued rent
and other charges, if Landlords' re-entry is the result of Tenant's bankruptcy,
insolvency, or reorganization, the full rental for the maximum period allowed by
any act relating to bankruptcy, insolvency or reorganization.
If Landlord re-enters the Premises for any cause, or if Tenant abandons or
vacates the Premises, and after the expiration of the term of this Lease, any
property left in the Premises by Tenant shall be deemed to have been abandoned
by Tenant, and Landlord shall have the right to retain or dispose of such
property in any manner without any obligation to account therefor to Tenant. If
Tenant shall at any time default hereunder, after notice and beyond the
expiration of any applicable cure period set forth herein, and if Landlord shall
institute an action or summary proceedings against Tenant based upon such
default, the Tenant will reimburse Landlord for the reasonable legal expenses
and fees thereby incurred by Landlord.
LANDLORD MAY CURE DEFAULTS.
6. If Tenant shall default in performing any covenant or condition of this
Lease, after notice and beyond the expiration of any applicable cure period,
Landlord may perform the same for the account of Tenant, and if Landlord, in
connection therewith, or in connection with any default by Tenant, after notice
and beyond the expiration of any applicable cure period, makes any expenditures
or incurs any obligations for the payment of money, including but not limited to
reasonable attorney's fees, such sums so paid or obligations incurred shall be
deemed to be additional rent
<PAGE>
hereunder, and shall be paid by Tenant to Landlord within ten (10) days of
rendition of any bill or statement therefor, and if Tenant's Lease term shall
have expired at the time of the making of such expenditures or incurring of such
obligations, such sums shall be recoverable by Landlord as damages.
ALTERATIONS.
7. Tenant shall make no decoration, alteration, addition or improvement in
the Premises, without the prior written consent of Landlord, and then only by
contractors or mechanics and in such manner and with such materials as shall be
approved by Landlord which shall not be unreasonably withheld or delayed.
Notwithstanding the foregoing, however, Landlord's prior negative experience
with, concerns regarding the financial stability or, and any criminal
proceedings pending against, any such contractor or mechanic shall be deemed to
be a reasonable basis upon which for Landlord to refuse to grant its approval.
All alterations, additions or improvements to the Premises, including window and
central air conditioning equipment and duct work, except movable office
furniture and equipment installed at the expense of Tenant, shall, unless
Landlord elects otherwise in writing, become the property of Landlord, and shall
be surrendered with Premises at the expiration or sooner termination of the term
of this Lease. Any such alterations, additions and improvements which Landlord
shall designate, shall be removed by Tenant and any damage repaired, at Tenant's
expense, prior to the expiration of the term of this Lease. Notwithstanding
anything to the contrary set forth above, Landlord agrees that it shall not
require Tenant to remove any alterations, additions or improvements made in/or
to the Premises other than (i) those which are not customarily found in the
Premises used for the purposes permitted under this Lease and those which are
not of a building standard nature, (ii) those which would require extraordinary
effort for Landlord to remove (iii) those raises computer floors, internal
staircase, dumbwaiters, pneumatic tubes, vertical and horizontal transportation
systems, vaults, safes, and medical installations, if any, and any alterations,
additions or improvements made specifically in connection with any food service
and/or food preparation facilities installed by Tenant (e.g., without
limitation, vents, hoods, grease traps, sinks, etc.) in the Premises
(collectively "Special Alterations"), and (iv) those which are installed or
performed without the prior written consent of Landlord where same is required
by the terms of this Lease. In any of the foregoing events, Tenant shall remove
the foregoing from the Premises at Tenant's expense prior to the expiration or
sooner termination of this Lease. Upon such removal, Tenant shall immediately
and at its expense, repair and restore the Premises to the condition existing
prior to such alternation, addition or improvement and repair any and all damage
to the Premises or the Building due to such removal.
LIENS.
8. Prior to commencement of its work in the demised Premises, Tenant shall
obtain and deliver to Landlord a written letter of authorization, in form
satisfactory to Landlord's counsel, signed by architects, engineers and
designers to become involved in such work, which shall confirm that any of their
drawings or plans are to be removed from any filing with governmental
authorities, on request of Landlord, in the event that said architect, engineer,
or designer thereafter no longer is providing services with respect to the
demised Premises. With respect to contractors, subcontractors, materialmen and
laborers, and architects, engineers and designers, for all work or materials to
be furnished to Tenant at the Premises, Tenant agrees to obtain and deliver to
Landlord written and unconditional waiver of mechanics liens upon the Premises
or the Building, after payments to the contractors, etc., subject to any then
applicable provisions on the Lien law. Notwithstanding the foregoing, Tenant at
its expense shall cause any lien filed against the Premises or the Building, for
work or materials claimed to have been furnished to Tenant, to be discharged of
record within twenty (20) days after notice thereof.
REPAIRS.
9. Tenant shall take good care of the Premises and the fixtures and
appurtenances therein, and shall make all repairs necessary to keep them in good
working order and condition, including structural repairs when those are
necessitated by the act, omission or negligence of Tenant or its agents,
employees or invitees other than due to a casualty covered by Landlord's
insurance. During the term of this Lease, Tenant may have the use of any air
conditioning equipment located in the Premises, and Tenant, at its own cost and
expense, shall maintain and repair such equipment and shall reimburse Landlord,
in accordance with Article 40 of this Lease, for electricity consumed by the
equipment. The exterior walls of the Building, the windows and the portions of
all window sills outside same and areas above any hung ceiling are not part of
the Premises demised by this Lease, and Landlord hereby reserves all rights to
such parts of the Building. Landlord agrees that during the term of this Lease,
it shall be responsible for the maintenance and repair of the common areas of
the Building and those portions of Building-wide systems not located within the
Premises, provided same does not in any way modify or reduce Landlord's
obligations with respect to the air conditioning equipment and facilities
servicing the Premises, as expressly set forth in Article 45 hereof.
DESTRUCTION.
10. If the Premises shall be partially damaged by fire or other casualty,
the damage to the Building and to the core and shell of the Premises (excluding
the Tenant improvements and betterments and Tenant's personal property) shall be
repaired at the expense of Landlord, but without prejudice to the rights of
subrogation, if any, of Landlord's insurer. Landlord shall not be required to
repair or restore any of Tenant's property or any alteration or leasehold
improvement made by or for Tenant at Tenant's expense. The rent shall abate in
proportion to the portion of the Premises not usable by Tenant or, if elevator
access to the Premises is unavailable and renders the Premises inaccessible,
fixed annual rent and additional rent shall abate until the Premises becomes
accessible, Landlord shall not be liable to Tenant for any delay in restoring
the Premises, Tenant's sole remedy being the right to an abatement or rent, as
above provided. If the Premises are rendered wholly untenantable by fire or
other casualty and if Landlord shall decide not to restore the Premises, or if
the Building shall be so damaged that Landlord shall decide core and shell of
the Premises (excluding the Tenant improvements and betterments and Tenant's
personal property) to demolish it or to rebuild it (whether or not the Premises
have been damaged), Landlord may within sixty (60) days after such fire or other
cause give written notice to Tenant of its election that the term of this Lease
shall automatically expire no less than fifteen (15) days after such notice is
given. If the Premises are rendered wholly untenantable due to fire or other
casualty and Landlord has not substantially restored the core and shell of the
Premises or elevator access thereto within one hundred and eighty (1800 days of
such fire or casualty, then, and in such event, Tenant may elect to cancel this
Lease upon giving written notice to Landlord within thirty (30) days after the
end of such one hundred and eighty (180) day period and the term of this Lease
shall expire on the date set forth therein which shall be not less than thirty
(30) days after the date such notice is given (the "Cancellation Date") provided
that Landlord does not substantially restore the core and shell of the Premises
prior to the Cancellation Date. Notwithstanding the foregoing, Landlord and
Tenant acknowledge and agree in the event that the Premises are rendered wholly
untenantable or Landlord is unable to provide elevator access thereto, and as a
result Tenant cannot and does not use the entire Premises, due to fire or other
casualty during the last six (6) months of the term of the Lease, Tenant may
elect to cancel this Lease upon giving ten (10) days' written notice to Landlord
that the term of this Lease shall expire on the date set forth therein which
shall be not less than ten (10) days after the date such notice is given.
Notwithstanding the foregoing, each party shall look first to any insurance in
its favor before making any claim against the other party for recovery for loss
or damage resulting from fire or other casualty, and to the extent that such
insurance is in force and collectible and to the extent permitted by law,
Landlord and Tenant each hereby releases and waives all right of recovery
against the other or any one claiming through or under each of them by way of
subrogation or otherwise. The foregoing release and waiver shall be in force
only if both releasers' insurance policies contain a clause providing that such
a release or waiver shall not invalidate the insurance and also, provided that
such a policy can be obtained without additional premiums, but if an additional
premium is required, Landlord or Tenant, as the case may be, shall be entitled
to pay same if it so desires. Tenant hereby expressly waives the provisions of
Section 227 of the Real Property law and agrees that the foregoing provisions of
this Article shall govern and control in lieu thereof.
END OF TERM.
11. Tenant shall surrender the Premises to Landlord at the expiration or
sooner termination of this Lease in good order and condition, except for
reasonable wear and tear and damage by fire or other casualty, and Tenant shall
remove all of its property. Tenant agrees it shall indemnify and save Landlord
harmless against all costs, claims, loss or liability resulting from delay by
Tenant in so surrendering the Premises, including, without limitation, any
claims made by any succeeding tenant founded on such delay. Additionally, the
parties recognize and agree that other damage to Landlord resulting from any
failure by Tenant timely to surrender the Premises will be substantial, will
exceed the amount of monthly rent theretofore payable hereunder, and will be
impossible of accurate measurement. Tenant therefore agrees that if possession
of the Premises is not surrendered to Landlord within one (1) day after the date
of the expiration or sooner termination of the term of this Lease, then Tenant
will pay Landlord as liquidated damages for each month and for each portion of
any month during which Tenant holds over in the Premises after expiration or
termination of the term of this Lease, a sum equal to two (2) times the average
rent and additional rent which was payable per month under this Lease during the
last six (6) months of the term thereof. The aforesaid obligations shall survive
the expiration or sooner termination of the term of this Lease. At any time
during the term of this Lease upon prior reasonable notice to Tenant, during
business hours and provided Tenant has an opportunity to have a representative
present, Landlord may exhibit the Premises to prospective purchasers or
mortgagees of Landlord's interest therein. During the last year of the term of
this Lease, Landlord may exhibit the Premises to prospective Tenants upon prior
reasonable notice to Tenant, during business hours and provided Tenant has an
opportunity to have a representative present.
SUBORDINATION AND ESTOPPEL, ETC.
12. Tenant has been informed and understands that Landlord is the subtenant
under a lease of the land and entire Building of which the Premises form a part
(hereinafter called the "Master Lease"). This Lease is and shall be subject and
subordinate to the Master Lease and all other ground and underlying leases and
to all mortgages which may now or hereafter affect such leases or the real
property of which the Premises form a part, and to all renewals, modifications,
consolidations, replacements and extensions thereof. This Article shall be
self-operative and no further instruments of subordination shall be necessary.
In confirmation of such subordination, Tenant shall execute promptly any
certificate that Landlord
<PAGE>
may request. Tenant hereby appoints Landlord as Tenant's irrevocable
attorney-in-fact to execute any document of subordination on behalf of Tenant,
provided that Tenant fails to execute and return to Landlord any such document
within twenty-one (21) days of its receipt of same. In the event the Master
Lease or any other ground or underlying Lease is terminated or any mortgage
foreclosed, this Lease shall not terminate or be terminable by Tenant (except as
hereinafter provided as to Master Lease expiration of term) unless Tenant was
specifically names in any termination of foreclosure judgment or final order. In
the event that the Master Lease or any other ground or underlying Lease is
terminated as aforesaid, or expires (as hereinafter provided), or if the
interests of Landlord under this Lease are transferred by reason of or assigned
in lieu of foreclosure or other proceedings for enforcement of any mortgage, or
if the holder of any mortgage acquires a lease in substitution therefor, then
Tenant will, at the option to be exercised in writing by Landlord under the
Master Lease or such purchaser, assignee or lessee, as the cause may be, (i)
attorn to it and will perform for its benefit all the terms, covenants and
conditions of this Lease on the Tenant's part to be performed with the same
force and effect as if said Landlord or such purchaser, assignee or lessee, were
the landlord originally named in this Lease or (ii) enter into a new lease with
said lessor or such purchaser, assignee or lessee, as landlord, for the
remaining term of this Lease and otherwise on the same terms, conditions and
rentals as herein provided. If the current term of the Master Lease shall expire
prior to the date set forth herein for the expiration of this Lease, then,
unless Landlord, at its sole option, shall have elected to extend or renew the
term of the Master Lease, or unless the lessor under the Master Lease elects
that the Tenant attorn or enter into a new lease as aforesaid, the term of this
Lease shall expire on the date of expiration of the Master Lease,
notwithstanding the later expiration date hereinabove set forth. If the Master
Lease is renewed, then the term of this Lease shall expire as hereinabove set
forth. From time to time, Tenant, on at least ten (10) days' prior written
request by Landlord will deliver to Landlord a statement in writing certifying
that this Lease is unmodified and in full force and effect (or if there shall
have been modifications, that the same is in full force and effect as modified
and stating the modification) and the dates to which the rent and other charges
have been paid and stating whether or not the Landlord is in default in
performance of any covenant, agreement, or condition contained in this Lease
and, if so, specifying each such default of which Tenant may have knowledge.
Landlord represents that the term of the Master Lease is scheduled to expire
after the term of this Lease is set to expire, that the execution of this Lease
does not violate any provision of the Master Lease, and that Landlord's
execution of this Lease is not prohibited by the terms of the Master Lease.
CONDEMNATION.
13. If the whole or any substantial part (substantial being any such
portion that prevents Tenant from operating its business in the Premises for the
uses permitted hereunder) of the Premises shall be condemned by eminent domain
or acquired by private purchase in lieu thereof for any public or quasi-public
purpose, this Lease shall terminate on the date of the vesting of title through
such proceeding or purchase, and Tenant shall have no claim against Landlord for
the value of any unexpired portion of the term of this lese, nor shall Tenant be
entitled to any part of the condemnation award or private purchase price. If
less than a substantial part of the Premises is condemned, this Lease shall not
terminate, but rent shall abate in proportion to the portion of the Premises
condemned.
REQUIREMENTS OF LAW.
14. (a) Tenant at is expense shall comply with all laws, orders and
regulations of any governmental authority having or asserting jurisdiction over
the Premises, which shall impose any violation, order or duty upon Landlord or
Tenant with respect to the Premises or the use or occupancy thereof including,
without limitation, compliance in the Premises with all City, State and Federal
laws, rules and regulations on the disabled or handicapped, on fire safety and
on hazardous materials. The foregoing shall not require Tenant to do structural
work. Landlord shall use reasonable efforts, at its sole cost and expense, to
cure within thirty (30) days after the commence net of the term of this Lease,
any New York City Building Department violations pertaining to the Premises
which are a matter of public record as of the commencement of the term of this
Lease. In connection with the foregoing, Landlord shall use reasonable efforts
to minimize interference with Tenant's business, provided, however, that Tenant
acknowledges and agrees that all such efforts shall be performed on normal
business days during normal business hours.
(b) Tenant shall require every person engaged by him to clean any window in
the remises from the outside, to use the equipment and safety devices required
by Section 202 of the labor law and the rules of any governmental authority
having or asserting jurisdiction.
(c) Tenant at its expense shall comply with all requirements of the New
York Board of Fire Underwriters, or any other similar body affecting the
Premises and shall not use the Premises in a manner which shall increase the
rate of fire insurance of Landlord or of any other tenant, over that in effect
prior to this Lease. If Tenant's use of the Premises increases the fire
insurance rate, Tenant shall reimburse Landlord for all such increased costs.
That the Premises are being used for the purpose set forth in Article 1 hereof
shall not relieve Tenant from the foregoing duties, obligations and expenses.
CERTIFICATION OF OCCUPANCY.
15. Tenant will at not time use or occupy the Premises in violation of the
certificate of occupancy issued for the Building. The statement in this Lease of
the nature of the business to be conducted by Tenant shall not be deemed to
constitute a representation or guaranty by Landlord that such use is lawful or
permissible in the Premises under the certificate of occupancy for the Building.
POSSESSION.
16. If Landlord shall be unable to give possession of the Premises on the
Commencement Date of the term because of the retention of possession of any
occupant thereof alteration or construction work, or for any other reason except
as hereinafter provided, Landlord shall not be subject to any liability for such
failure. In such event, this Lease shall stay in full force and effect, without
extension of its term. However, the rent hereunder shall not commence until the
Premises are available for occupancy by Tenant. If delay in possession is due to
work, changes or decorations being made by or for Tenant, or is otherwise caused
by Tenant, there shall be no rent abatement and the rent shall commence on the
date specified in this Lease. If permission is given to Tenant to occupy the
demised Premises or other premises prior to the date specified as the
commencement of the term, such occupancy shall be deemed to be pursuant to the
terms of this Lease, except that the parties shall separately agree as to the
obligation of Tenant to pay rent for such occupancy. The provisions of this
Article are intended to constitute an "express provision to the contrary" within
the meaning of Section 223(a), New York Real Property Law.
QUIET ENJOYMENT.
17. Landlord covenants that if Tenant pays the rent and performs all of
Tenant's other obligations under this Lease, prior to expiration of any
applicable notice and beyond the cure period set forth therein, Tenant may
peaceably and quietly enjoy the demised Premises, subject to the terms,
covenants and conditions of this Lease and to the ground leases, underlying
leases and mortgages hereinbefore mentioned.
RIGHT OF ENTRY.
18. Tenant shall permit Landlord to erect and maintain pipes and conduits
in and through the Premises provided that they are concealed, erected along
perimeter walls wherever possible and are installed in a manner which does not
interfere with Tenant's use of the Premises. Landlord or its agents shall have
the right to enter or pass through the Premises at all times, by master key upon
reasonable oral prior notice to Tenant at reasonable times and by reasonable
force in the event of an Emergency Situation without notice to Tenant, to
examine the same, and to make such repairs, alterations or additions as it may
deem necessary or desirable to the Premises or the Building, and to take all
material into and upon the Premises that may be required therefor. Such entry
and work shall not constitute an eviction of Tenant in whole or in part, shall
not be grounds for any abatement of rent, and shall impose no liability on
Landlord by reason of inconvenience or injury to Tenant's business. Landlord
shall have the right at any time, without the same constituting an actual or
constructive eviction, and without incurring any liability to Tenant, to change
the arrangement and/or location of entrances or passageways, windows, corridors,
elevators, stairs, toilets, or other public parts of the Building, and to change
the name or number by which the Building is known. Landlord shall exercise due
diligence to prosecute to completion any repairs which it is obligated or
permitted to make pursuant to this Lease and when performing such repairs shall
do so in a good and workmanlike manner using new, equal or better quality
materials to those then existing in the Premises in accordance with all
applicable laws and shall use reasonable efforts to minimize interference with
Tenant's permitted use of the Premises, provided, however, that Tenant
acknowledges and agrees that all such efforts shall be performed on normal
business days during normal business hours.
VAULT SPACE.
19. Anything contained in any plan or blueprint to the contrary
notwithstanding, no vault or other space not within the Building property line
is demised hereunder. Any use of such space by Tenant shall be deemed to be
pursuant to a license, revocable at will by Landlord, without diminution of the
rent payable hereunder. If Tenant shall use such vault space, the percentage
(hereinafter defined) of any fees, taxes or charges made by any governmental
authority for such space shall be aid by Tenant.
INDEMNITY.
20. Tenant shall indemnity, defend and save Landlord harmless from and
against any liability or reasonable expense arising from the use or occupation
of the Premises by Tenant, or anyone on the Premises with Tenant's permission or
from any breach of this Lease beyond notice and the expiration of any applicable
cure periods set forth therein.
LANDLORD'S LIABILITY.
21. This Lease and the obligations of Tenant hereunder shall, except as
otherwise set forth herein, in no way be affected because Landlord is unable to
fulfill any of its obligations or to supply any service, by reason of strike or
other cause not within Landlord's control. Landlord shall have the right,
without incurring any liability to Tenant, to stop any service because of
accident or emergency, or for repairs, alterations or improvements, necessary or
desirable in the judgment of Landlord, until such repairs, alterations or
improvements shall have been completed. Landlord shall not be liable to Tenant
or anyone else, for any loss or damage to person,
<PAGE>
property or business, unless due to the negligence or willful misconduct of
Landlord nor shall Landlord be liable for any latent defect the Premises or the
Building. Tenant, during the term of this Lease, shall carry public liability
and property damage insurance, from a company authorized to do business in New
York, with limitations acceptable to Landlord, which policy or policies shall
name the Landlord and its designees as additional insureds. Evidence of the
policies, and of their timely renewal, shall be delivered to Landlord. All such
insurance shall contain an agreement by the insurance company that the policy or
policies will not be cancelled or the coverage changed, without thirty (30)
days' prior written notice to the Landlord. Tenant agrees to look solely to
Landlord's estate and interest in the land and Building, or the Lease of the
Building or of the land and Building, and the demised Premises, including
rentals, refinancing proceeds, condemnation awards and insurance proceeds, for
the satisfaction of any right or remedy of Tenant for the collection of a
judgment (or other judicial process) requiring he payment of money by Landlord,
in the event of any liability by Landlord, and no other property or assets of
Landlord 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 Landlord and Tenant hereinunder, or Tenant's use and occupancy
of the demised Premises or any other liability of Landlord to Tenant (except for
negligence).
CONDITION OF PREMISES.
22. Tenant acknowledges that Landlord has made no representation or
promise, except as herein expressly set forth. Tenant agrees to accept the
Premises "as is," except for any work which Landlord has expressly agreed in
writing to perform. Landlord shall be responsible for compliance will all
applicable laws, rules and regulations (including, without limitation,
environmental laws and the American with Disabilities Act) in the common areas
of the Building.
TAX ESCALATION.
23. Tenant shall pay to Landlord, as additional rent, tax escalation in
accordance with this Article:
(a) For purposes of this Lease the rentable square foot area of the
presently demised Premises shall be deemed to be eight thousand sixty-four
(8,064) square feet.
(b) Definitions: For the purpose of this Article, the following definitions
shall apply:
(i) The term "base tax year" as hereinafter set forth for the
determination of real estate tax escalation, shall mean the New York City
real estate tax year commencing July 1, 1999 and ending June 30, 2000.
(ii) The term "The Percentage," for purposes of computing tax
escalation, shall mean point seven two five (.725%) percent. The Percentage
has been computed on the basis of a fraction, the numerator of which is the
rentable square foot area of the demised Premises and the denominator of
which is the total rentable square foot area of the office and commercial
space in the building project. The parties acknowledge and agree that the
total rentable square foot area of the office and commercial space in the
building project shall be deemed to be one million one hundred twelve
thousand four hundred twenty-four (1,112,424) square feet.
(iii) the term "the building project" shall mean the aggregate
combined parcel of land on a portion of which are the improvements of which
the demised Premises form a part, with all the improvements thereon, said
improvements being a part of the block and lot for tax purposes which are
applicable to the aforesaid land.
(iv) The term "comparative year" shall mean the twelve (12) months
following the base tax year, and each subsequent Period of twelve (12)
months (or such other Period of twelve (12) months occurring during the
term of this Lease as hereafter may be duly adopted as the tax year for
real estate tax purposes by the City of New York).
(v) The term "real estate taxes" shall mean the total of all taxes and
special or other assessments levied, assessed or imposed at any time by any
governmental authority upon or against the building project, and also any
tax assessment levied, assessed or imposed at any time by any governmental
authority in connection with the receipt of income or rents from said
building project to the extent that same shall be in lieu of all or a
portion of any of the aforesaid taxes or assessments, or additions or
increases thereof, upon or against said building project. If, due to a
future change in the method of taxation or in the taxing authority, or for
any other reason, a franchise, income, transit, profit or other tax or
governmental imposition, however designated, shall be levied against
Landlord in substitution in whole or in part for real estate taxes, or in
lieu of additions to or increases of said real estate taxes, then such
franchise, income, transit, profit or other tax or governmental imposition
shall be deemed to be included within the definition of "real estate taxes"
for the purposes hereof. As to special assessments which are payable over a
period of time extending beyond the terms of this Lease, only a pro rata
portion thereof covering the portion of the term of this Lease unexpired at
the time of the imposition of such assessment, shall be included in "real
estate taxes." If by law, any assessment may be paid in installments, then,
for the purposes hereof (a) such assessment shall be deemed to have been
payable in the maximum number of installments permitted by law and (b)
there shall be included in real estate taxes, for each comparative year in
which such installments may be paid, the installments of such assessment to
becoming payable during such comparative year, together with interest
payable during such comparative year. Notwithstanding anything contained
herein to the contrary, real estate taxes shall not, for purposes of this
Lease, be deemed to include franchise taxes, excise taxes, gift taxes,
capital stock taxes, inheritance taxes or real estate taxes. In addition,
Tenant shall have no obligation to pay any interest or penalties on real
estate taxes imposed on Landlord as a result of late payments by Landlord
(unless resulting from a late payment by Tenant).
(vi) Where more than one assessment is imposed by the City of New York
for any tax year, whether denominated an "actual assessment" or a
"transitional assessment" or otherwise, then the phrases herein "assessed
value" and "assessments" shall mean whichever of the actual, transitional
or other assessment is designated by the City of New York as the taxable
assessment for that tax year.
(c) 1. In the event that the real estate taxes payable for any comparative
year shall exceed the amount of the real estate taxes payable during the base
tax year, Tenant shall pay to Landlord, as additional rent for such comparative
year, an amount equal to The Percentage of this excess. Before or after the
start of each comparative year, Landlord shall furnish to Tenant a statement of
the real estate taxes payable for such comparative year, and a statement of the
real estate taxes payable during the base tax year. If the real estate taxes
payable for such comparative year exceed the real estate taxes payable during
the base tax year, additional rent for such comparative year, in an amount equal
to The Percentage of the excess, shall be due from Tenant to Landlord, and such
additional rent shall be payable by Tenant to Landlord within ten (10) days
after receipt of the aforesaid statement. The benefit of any discount for any
earlier payment or prepayment of real estate taxes shall accrue solely to the
benefit of Landlord, and such discount shall not be subtracted from the real
estate taxes payable for any comparative year.
Additionally, Tenant shall pay to Landlord, on demand, a sum equal to The
Percentage of any business improvement district assessment payable by the
building project.
2. Should the real estate taxes payable during the base tax year be reduced
by final determination of legal proceedings, settlement or otherwise, then the
real estate taxes payable during the base tax year shall be correspondingly
revised, the additional rent theretofore paid or payable hereunder for all
comparative years shall be recomputed on the basis of such reduction, and Tenant
shall pay to Landlord as additional rent, within ten (10) days after being
billed therefor, any deficiency between the amount of such additional rent as
theretofore computed and the amount thereof due as the result of such
recomputations. Should the real estate taxes payable during the base tax year be
increased by such final determination of legal proceedings, settlement or
otherwise, then appropriate recomputation and adjustment also shall be made.
3. If after Tenant shall have made a payment of additional rent under this
subdivision (c), Landlord shall receive a refund of any portion of the real
estate taxes payable for any comparative year after the base tax year on which
such payment of additional rent shall have been based, as a result of a
reduction of such real estate taxes by final determination of legal proceedings,
settlement or otherwise, Landlord shall within ten (10) days after receiving the
refund pay to Tenant The Percentage of the refund.
4. The statements of the real estate taxes to be furnished by Landlord as
provided above shall be certified by Landlord and shall constitute a final
determination as between Landlord and Tenant of the real estate taxes for the
periods represented, thereby, unless Tenant within ninety (90) days after they
are furnished shall give a written notice to Landlord that it disputes their
accuracy or their appropriateness, which notice shall specify the particular
respects in which the statement is inaccurate or inappropriate. If Tenant shall
so dispute said settlement then, pending the resolution of such dispute, Tenant
shall pay the additional rent to Landlord in accordance with the statement
furnished by Landlord.
5. In no event shall the fixed annual rent under this Lease (exclusive of
the additional rents under this Article) be reduced by virtue of this Article.
6. If the Commencement Date of the term of this Lease is not the first day
of the first comparative year, then the additional rent due hereunder for such
first comparative year shall be a proportionate share of said additional rent
for the entire comparative year, said proportionate share to be based upon the
length of time that the Lease term will be in existence during such first
comparative year. Upon the date of any expiration or termination of this Lease
(except termination because of Tenant's default) whether the same be the date
hereinabove set forth for the expiration of the term or any prior or subsequent
date, a proportionate share of said additional rent for the comparative year
during which such expiration or termination occurs shall immediately become due
and payable by Tenant to Landlord, if it was not theretofore already billed and
paid. The said proportionate share shall be based upon the length of time that
this Lease shall have been in existence during such comparative year. Landlord
shall promptly cause statements of said additional rent for that comparative
year to be prepared and furnished to lessee. Landlord and Tenant shall thereupon
make appropriate adjustments or amounts then owing.
<PAGE>
7. Landlord's and Tenant's obligations to make the adjustments referred to
in subdivision (6) above shall survive any expiration or termination of this
Lease.
8. Any delay or failure of lessor in billing any tax escalation hereinabove
provided shall not constitute a waiver of or in any way impair the continuing
obligation of lessee or pay such tax escalation hereunder (provided such
statement is rendered within two (2) years of the expiration of the term of this
Lease).
9. In addition to all fixed annual rent and additional rent payable
pursuant to the terms of this Lease and this Article, Tenant shall pay to
Landlord, as additional rent, within ten (10) days after Landlord shall have
delivered to Tenant a statement therefor, the Percentage of all out-of-pocket
expenses incurred by Landlord in reviewing or contesting the validity or amount
of any Real Estate Taxes, including without limitation, the reasonable
attorneys' fees and fees and disbursements of attorneys, third-party
consultants, experts and others.
SERVICES.
24. Tenant acknowledges that it has been advised that the cleaning
contractor for the Building may be a division or affiliate of Landlord. Subject
to Article 31 hereof, Tenant agrees to employ said contractor, or such other
contractor as Landlord shall from time to time designate, for any waxing,
polishing and other maintenance work of the demised Premises and of the Tenant's
furniture, fixtures and equipment, provided that the prices charged by said
contractor are comparable to prices charged by other contractors for the same
work. Tenant agrees that it shall not employ any other cleaning and maintenance
contractor, nor any individual, firm or organization for such purpose. If
Landlord and Tenant cannot agree on whether the prices being charged by the
contractor designated by the Landlord are comparable to those charged by other
contractors, Landlord and Tenant shall each obtain two bona fide bids for such
work from reputable contractors, and the average of the four bids thus obtained
shall be the standard for comparison.
JURY WAIVER.
25. Landlord and Tenant hereby waive trial by jury in any action,
proceeding or counterclaim involving any matter whatsoever arising out of or in
any way connected with this Lease, the relationship of Landlord and Tenant.
Tenant's use or occupancy of the Premises (except for personal injury or
property damage) or involving the right to any statutory relief or remedy.
Tenant will not interpose any counterclaim of any nature in any summary
proceedings, except for compulsory counterclaims.
NO WAIVER, ETC.
26. No act or omission of Landlord or its agents shall constitute an actual
or constructive eviction, unless Landlord shall have first received written
notice of Tenant's claim and shall have had reasonable opportunity to meet such
claim. In the event that any payment herein provided for by Tenant to Landlord
shall become overdue for a period in excess of ten (10) days, then at Landlord's
option a "late charge" shall become due and payable to Landlord, as additional
rent, from the date it was due until payment is made at the following rates: for
individual and partnership Tenants, said late charge shall be computed at the
maximum legal rate of interest; for corporate or governmental entity Tenants,
the late charge shall be computed at two (2%) percent per month unless there is
an applicable maximum legal rate of interest which then shall be used. No act or
omission of Landlord or its agents shall constitute an acceptance of a surrender
of the Premises, except a writing signed by Landlord. The delivery of keys to
Landlord or its agents shall not constitute a termination of this Lease or a
surrender of the Premises. Acceptance by Landlord of less than the rent herein
provided shall at Landlord's option be deemed on account of earliest rent
remaining unpaid. No endorsement on any check, or letter accompanying rent,
shall be deemed an accord and satisfaction, and such check may be cashed without
prejudice to Landlord. No waiver of any provision of this Lease shall be
effective unless such waiver be in writing signed by Landlord. This Lease
contains the entire agreement between the parties, and no modification thereof
shall be binding unless in writing and signed by the party concerned. Tenant
shall comply with the rules and regulations printed in this Lease, and any
reasonable modifications thereof or additions therefore. Landlord shall not be
liable to Tenant for the violation of such rules and regulations by any other
tenant. Failure of Landlord to enforce any provision of this Lease, or any rule
or regulation, shall not be construed as the waiver of any subsequent violation
of a provision of this Lease, or any rule or regulation. This Lease shall not be
affected by nor shall Landlord in any way be liable for the closing, darkening
or bricking up of windows in the Premises, for any reason, including as the
result of construction on any property of which the Premises are not a part or
by Landlord's own acts. Notwithstanding anything contained herein to the
contrary, Landlord and Tenant agree that if seventy (70%) percent or more of the
windows located in the Premises are brickened up in excess of thirty (30) days,
then, and in such event, Tenant may elect to cancel this Lease upon giving
written notice to Landlord within fifteen (15) days after the end of such thirty
(30) day period and the term of this Lease shall expire on the date set forth
herein which shall be not less than fifteen (15) days after the date such notice
is given (the "Cancellation Date") provided that Landlord does not substantially
restore such brickening prior to the Cancellation Date.
OCCUPANCY AND SUE BY TENANT.
27. If Tenant breaches the covenants in subdivision (A) above (?A -
REMOVED?), and this Lease be terminated because of such default, then, in
addition to Landlord's rights of re-entry, restoration, preparation for and
re-rental, and anything elsewhere in this Lease to be contrary notwithstanding,
Landlord shall retain its right to judgment on and collection of Tenant's
aforesaid obligation to make a single payment to Landlord of a sum equal to the
total of all rent and additional rent reserved for the remainder of the original
term of the Lease, subject to future credit or repayment to Tenant in the event
of any re-renting of the Premises by Landlord, after first deducting from
re-rental income all expenses incurred by Landlord in reducing to judgment or
otherwise collecting Tenant's aforesaid obligation, and in obtaining possession
of restoring, preparing for and re-letting the Premises. In no event shall
Tenant be entitled to a credit or repayment for re-rental income which exceeds
the sums payable by Tenant hereunder or which covers a period after the original
term of this Lease.
NOTICES.
28. Any bill, notice or demand from Landlord to Tenant, may be delivered
personally at the Premises or sent by registered or certified mail or by Federal
Express or other reputable overnight courier. Such bill, notice or demand shall
be deemed to have been given at the time of delivery or three (3) days after
mailing. Any notice from Tenant to Landlord must be sent by registered or
certified mail to the last address designated in writing by Landlord.
WATER.
29. Tenant shall pay the amount of Landlord's cost for all water used by
Tenant for any purpose other than ordinary lavatory and pantry uses, and any
sewer rent or tax based thereon. Landlord may install a water meter to measure
Tenant's water consumption for all purposes and Tenant agrees to pay for
installation and maintenance thereof, and for water consumed as shown on said
meter. If water is made available to Tenant in the Building or the demised
Premises through a meter which also supplies other premises, or without a meter,
then Tenant shall pay to Landlord $ per month for water.
SPRINKLER SYSTEM.
30. If there shall be a "sprinkler system" in the demised Premises for any
period during this Lease, Tenant shall pay $ per month, for sprinkler
supervisory service. If such sprinkler system is damaged by any act or omission
of Tenant or its agents, employees, licensees or visitors, Tenant shall restore
the system to good working condition at its own expense. If the New York Board
of Fire Underwriters, the New York Fire Insurance Exchange, the Insurance
Services Office or any governmental authority requires the installation or any
alteration to a sprinkler system by reason of Tenant's occupancy or use of the
Premises, including any alteration necessary to obtain in the full allowance for
a sprinkler system in the fire insurance rate of Landlord, or for any other
reason, Tenant shall make such installation or alteration promptly, and at its
own expense.
HEAT, ELEVATOR, ETC.
31. Landlord shall provide a minimum of one (1) passenger elevator
twenty-four (24) hours a day seven (7) days a week and provide elevator service
during all usual business hours, including Saturdays until 1 P.M., except on
Sundays, State holidays, Federal holidays, or Building Service Employees Union
Contract holidays. Landlord shall furnish heat to the Premises during the same
hours on the same days in the cold season in each year. Landlord shall cause the
Premises to be kept clean in accordance with Landlord's customary standards for
the Building, provided they are kept in order by Tenant. Landlord, its cleaning
contractor and their employees shall have after hours access to the demised
Premises and the use of Tenant's light, power and water in the demised Premises
as may be reasonably required for the purpose of cleaning the demised Premises.
Landlord may remove Tenant's extraordinary refuse from the Building and Tenant
shall pay the cost thereof. If the elevators in the Building are manually
operated, Landlord may convert to automatic elevators at any time, without in
any way affecting Tenant's obligations hereunder.
SECURITY DEPOSIT.
32. Tenant has deposited with Landlord the sum of $120,885.20 as security
for the performance by Tenant of the terms of this Lease. Landlord may use any
part of the Security to satisfy any default of Tenant, which is not cured after
notice and beyond the expiration of any applicable cure period set forth herein
and any reasonable expenses arising from such default, which was not so cured
within any applicable cure period, including but not limited to any damages or
rent deficiency before or after re-entry by Landlord. Tenant shall, upon demand,
deposit with Landlord the full amount to be used, in order that Landlord shall
have the full security deposit on hand at all times during the terms of this
Lease. If Tenant shall comply fully with the terms of this Lease, the security
shall be returned to Tenant within thirty (30) days after the date fixed as the
end of the Lease. In the event of a sale or Lease of the Building containing the
Premises, Landlord may transfer the security to the purchaser or tenant, and
Landlord shall thereupon, provided any such transferee assumes in writing all
obligations of Landlord under this Lease, be released from all liability for the
return of the security. This provision shall apply to every transfer or
assignment of the security to a new Landlord. Tenant shall have no legal power
to assign or encumber the security herein described.
<PAGE>
ELECTRICITY.
33. Terms and conditions with respect to electricity rent inclusion, or
with respect to sub-metering, as the case may be, and general conditions with
respect to either, are set forth in Article 40 in the Rider annexed to and made
part of this Lease.
RENT CONTROL.
34. In the event the fixed annual rent or additional rent or any part
thereof provided to be paid by Tenant under the provisions of this Lease during
the demised term shall become uncollectible or shall be reduced or required to
be reduced or refunded by virtue of any Federal, State or County or City law,
order or regulation, or by any direction of a public officer or body pursuant to
law, or the orders, rules code or regulations of any organization or entity
formed pursuant to law, whether such organization or entity be public or
private, then Landlord, at its option, may at any time thereafter terminate this
Lease, by not less than thirty (30) days' written notice to Tenant, on a date
set forth in said notice, in which event this Lease and the term hereof shall
terminate and come to an end on the date fixed in said notice as if the said
date were the date originally fixed herein for the termination of the demised
term. Landlord shall not have the right so to terminate this Lease if Tenant
within such period of thirty (30) days shall in writing lawfully agree that the
rentals herein reserved are a reasonable rental and agree to continue to pay
said rentals, and if such agreement by Tenant shall then be legally enforceable
by Landlord.
SHORING.
35. Tenant shall permit any person authorized to make an excavation on land
adjacent to the Building containing the Premises to do any work within the
Premises necessary to preserve the wall of the Building from injury or damage,
and Tenant shall have no claim against Landlord for damages or abatement of rent
by reason thereof.
EFFECT OF CONVEYANCE, ETC.
36. If the Building containing the Premises shall be sold, transferred or
leased, or the Lease thereof transferred or sold, Landlord shall be relieved of
all future obligations and liabilities hereunder and the purchaser, transferee
or Tenant of the Building shall be deemed to have assumed and agreed to perform
all such obligations and liabilities for Landlord hereunder. In the event of
such sale, transfer or lease, Landlord shall also be relieved of all existing
obligations and liabilities hereunder, provided that the purchaser, transferee
or tenant of the Building assumes in writing such obligations and liabilities.
RIGHTS OF SUCCESSORS AND ASSIGNS.
37. This Lease shall bind and inure to the benefit of the heirs, executors,
administrators, successors, and, except as otherwise provided herein, the
assigns of the parties hereto. In any provision of any Article of this Lease or
the application thereof to any person or circumstances shall, to any extent, be
invalid or unenforceable, the remainder of that Article, or the application of
such provision or persons or circumstances other than those as to which it is
held invalid or unenforceable, shall not be affected thereby, and each provision
of said Article and of this Lease shall be valid and be enforced to the fullest
extent permitted by law.
CAPTIONS.
38. The captions herein are inserted only for convenience, and are in no
way to be construed as a part of this Lease or as a limitation of the scope of
any provision of this Lease.
LEASE SUBMISSION.
39. Landlord and Tenant agree that this Lease is submitted to Tenant on the
understanding that it shall not be considered an offer and shall not bind
Landlord in any way unless and until (i) Tenant has duly executed and delivered
duplicate originals thereof to Landlord and (ii) Landlord has executed and
delivered one (1) of said originals to Tenant.
<PAGE>
SEE RIDER(S) ANNEXED HERETO AND MADE A PART HEREOF consisting
of pages 1 through 35, containing rules and regulations, Articles 40 through 60,
a location plan, cleaning specifications and Exhibit A.
In Witness Whereof, Landlord and Tenant have executed this Lease as of the
day and year first above written.
SLG Graybar Sublease LLC, a New York Fusion Telecommunications International, Inc.
------------------------------------------------------ ------------------------------------------------------
limited liability company
By: SLG Graybar Sublease Corp, A New York By:
------------------------------------------------------ ------------------------------------------------------
corporation, its Managing Member
By: By:
-------------------------------------------------- --------------------------------------------------
(Name) (Title) (Name) (Title)
ACKNOWLEDGEMENTS
State of New Jersey )
ss.:
County of Hudson )
On the day of , 20 , before me
State of New York ) personally came
ss.: to me known, who being by me duly sworn, did depose and
County of New York ) say that he resides at No.
On the day of , 20 , before me that he is the of
personally came the corporation described in, and which executed, the
to me known and known to me to be the individual described in, foregoing instrument; and that he signed h name thereto
and who executed, the foregoing instrument, and acknowledged by authority of the Board of Directors of said corporation.
to me that he executed the same.
--------------------------------------------- ----------------------------------------------
Notary Public Notary Public
IN WITNESS WHEREOF, the undersigned has set hand and seal this day of 20
(L.S.)
-------------------------------------------------------------- ------------------------------------------------------------
(L.S.)
-------------------------------------------------------------- ------------------------------------------------------------
To me known and kwon to me to be the individual described
in, and who executed the foregoing Guaranty and acknowledged
to me that he executed the same
State of New York )
Ss:
County of New York)
On the day of , 20 , before me personally came
----------------------------------------------
Notary Public
<PAGE>
EXHIBIT A
Upon the occurrence of the Commencement Date (as defined in Article 55 hereof),
Tenant shall pay fixed annual rent to Landlord, subject to provisions of Article
53 hereof, at the annual rate of (i) $298,368.00 per annum beginning on the
Commencement Date through the last day of the month immediately preceding the
second (2nd) anniversary of the Commencement Date of the Lease; (ii) $314,496.00
per annum for the period commencing on the second (2nd) anniversary of the
Commencement Date of the Lease through the last day of the month immediately
preceding the fifth (5th) anniversary of the Commencement Date of the Lease; and
(iii) $330,624.00 per annum commencing on the fifth (5th) anniversary of the
Commencement Date of the Lease through the expiration of the term of this Lease.
<PAGE>
----------------------------------------------------------------------
RIDER ANNEXED TO AND MADE A PART OF THE LEASE BETWEEN
SLG GRAYBAR SUBLEASE LLC LANDLORD
-------------------------------------------------
AND FUSION TELECOMMUNICATIONS INTERNATIONAL, INC. TENANT
--------------------------------------------------
----------------------------------------------------------------------
RULES AND REGULATIONS REFERRED TO IN THIS LEASE
1. No animals, birds, bicycles or vehicles shall be brought into or kept in
the Premises. The Premises shall not be used for manufacturing or commercial
repairing or for sale or display of merchandise or as a lodging place, or for
any immoral or illegal purpose, nor shall the Premises be used for a public
stenographer or typist; barber or beauty shop, telephone, secretarial or
messenger service; employment, travel or tourist agency; school or classroom;
commercial document reproduction; or for any business other than specifically
provided for in the Tenant's lease. Tenant shall not cause or permit in the
Premises any disturbing noises which may interfere with occupants of this
neighboring buildings, any cooking or objectionable odors, or any nuisance of
any kind, or any inflammable or explosive fluid, chemical or substance.
Canvassing, soliciting and peddling in the Building are prohibited, and each
Tenant shall cooperate so as to prevent the same.
2. The toilet rooms and other water apparatus shall not be used for any
purposes other than those for which they were constructed, and no sweepings,
rags, ink, chemicals or other unsuitable substances shall be thrown therein.
Tenant shall not throw anything out of doors, windows of skylights, or into
hallways, stairways or elevators, nor place foot or objects on outside window
sills. Tenant shall not obstruct or cover the halls, stairways and elevators, or
use them for any purpose other than ingress and egress to or from Tenant's
Premises, nor shall skylights, windows, doors and transoms that reflect or admit
light into the Building be covered or obstructed in any way.
3. Tenant shall not place a load upon any floor of the Premises in excess
of the load per square foot which such floor was designed to carry and which is
allowed by law. Landlord reserves the right to prescribe the weight and position
of all safes in the Premises. Business machines and mechanical equipment shall
be placed and maintained by Tenant, at Tenant's expense, only with Landlord's
consent which consent Landlord shall not unreasonably withhold, condition or
delay and in settings approved by Landlord which approval shall not be
unreasonably withheld to control weight, vibration, noise and annoyance. Smoking
or carrying lighted cigars, pipes or cigarettes in the elevators of the Building
is prohibited. If the Premises are on the ground floor of the Building, the
Tenant thereof at its expense shall keep the sidewalks and curb in front of the
Premises clean and free from ice, snow, dirt and rubbish.
4. Tenant shall not move any heavy or bulky materials into or out of the
Building without Landlord's prior written consent which consent Landlord shall
not unreasonably withhold, condition or delay and then only during such manner
as Landlord shall approve which consent Landlord shall not be unreasonably
withheld. If any material or equipment requires special handling, Tenant shall
employ only persons holding a Master Rigger's License to do such work, and all
such work shall comply with all legal requirements. Landlord reserves the right
to inspect all freight to be brought into the Building, and to exclude any
freight which violates any rule, regulation or other provision of this Lease.
5. No sign, advertisement, notice or thing shall be inscribed, painted or
affixed on any part of the Building, without the prior written consent of
Landlord which consent Landlord shall not unreasonable withhold, condition or
delay. Landlord may remove anything installed in violation of this provision and
Tenant shall pay the cost of such removal. Interior signs on doors and
directories shall be inscribed or affixed by Landlord at Tenant's reasonable
expense. Landlord shall control the color, size, style and location of all
signs, advertisements and notices. No advertising of any kind by Tenant shall
refer to the Building (other than its address) unless first approved in writing
by Landlord.
6. No article shall be fastened to, or holes drilled or nails or screws
driven into, the ceilings, walls, doors or other portions of the Premises, nor
shall any part of the Premises be painted, papered or otherwise covered, or in
any way marked or broken, without the prior written consent of Landlord, which
consent Landlord shall not unreasonably withhold, condition or delay.
7. No existing locks shall be changed, nor shall any additional locks or
bolts of any kind be placed upon any door or window by Tenant, without the prior
written consent of Landlord, which consent shall not be unreasonably withheld,
conditioned or delayed, provided that a copy of all such keys are delivered
simultaneously to Landlord. At the termination of this Lease, Tenant shall
deliver to Landlord all keys for any portion of the Premises or Building. Before
leaving the Premises at any time, Tenant shall close all windows and close and
lock all doors.
8. No Tenant shall purchase or obtain for use in the Premises any spring
water, ice, towels, food, boot blacking, barbering or other such service
furnished by any company or person not approved by Landlord. Any necessary
exterminating work in the Premises shall be done at Tenant's expense, at such
times, in such manner and by such company as Landlord shall require. Landlord
reserves the right to exclude from the Building, from 6:00 p.m. to 8:00 a.m.,
and at all hours on Sunday and legal holidays, all persons who do not present a
pass to the Building signed by Landlord. Landlord will furnish passes to all
persons reasonably designated by Tenant. Tenant shall be responsible for the
acts of all persons to whom passes are issued at Tenant's request.
9. Whenever Tenant shall submit to Landlord any plan, agreement or other
document for Landlord's consent or approval, Tenant agrees to pay Landlord as
additional rent, on demand, an administrative fee equal to the sum of the
reasonable fees of any architect, engineer or attorney employed by Landlord to
review said plan, agreement or document and Landlord's administrative costs for
same.
10. The use in the demised Premises of auxiliary heating devices, such as
portable electric heaters, heat lamps or other devices whose principal function
at the time of operation is to produce space heating, is prohibited.
11. Tenant shall keep all doors from the hallway to the Premises closed at
all times except for use during ingress to and egress from the Premises. Tenant
acknowledges that a violation of the terms of this paragraph may also constitute
a violation of codes, rules or regulations of governmental authorities having or
asserting jurisdiction over the Premises, and Tenant agrees to indemnify lessor
for many fines, penalties, claims, action or increase in fire insurance rates
which might result from Tenant's violation of the terms of this paragraph.
12. Tenant shall be permitted to maintain an "in-house" messenger or
delivery service within the Premises, provided that Tenant shall require that
any messengers in its employ affix identification to the breast pocket of their
outer garment, which shall bear the following information: name of Tenant, name
of employee and photograph of the employee. Messengers in Tenant's employ shall
display such identification at all time. In the event that Tenant or any agent,
servant or employee of Tenant violates the terms of this paragraph, Landlord
shall be entitled to terminate Tenant's permission to maintain within the
Premises in-house messenger or delivery service upon written notice to Tenant.
13. Tenant will be entitled to five (5) listings on the Building lobby
directory board, and the directory board on the floor of the Building on which
the Premises is located, without charge. Any additional directory listing (if
space is available), or any change in a prior listing, with the exception of a
deletion, will be subject to a fourteen ($14.00) dollar service charge, payable
as additional rent.
In case of any conflict or inconsistency between any provisions of this
Lease and any of the rules and regulations originally or as hereafter adopted,
the provisions of this Lease shall control.
<PAGE>
ELECTRICITY.
40. Tenant agrees that Landlord may, subject to the provisions of this
Article, furnish electricity to Tenant on a "sub-metering" basis or an a "rent
inclusion basis." Electricity and electric service, as used herein, shall mean
any element affecting the generation, transmission, and/or distribution or
redistribution of electricity, including but not limited to services which
facilitate the distribution of service. Landlord covenants that it shall not
alter the method by which it presently furnishes electricity to the Premises for
Tenant's use therein from a "rent inclusion" basis to a "sub-metering" basis
unless it alters the method by which it furnishes electricity from a "rent
inclusion" basis to a "sub-metering" basis for Tenant's leasing fifty (50%)
percent or more of the rentable space in the Building.
A. Sub-metering: If and so long as Landlord provides electricity to the
demised Premises on a sub-metering basis, Tenant covenants and agrees to
purchase the same from Landlord or Landlord's designated agent at charges, terms
and rates set, from time to time, during the term of this Lease by Landlord but
not more than those specified in the service classification in effect on January
1, 1970 pursuant to which Landlord then purchased electric current from the
public utility corporation serving the part of the city where the Building is
located; provided however, said charges shall be increased in the same
percentage as any percentage increase in the billing to Landlord for electricity
for the entire Building, by reason of increase in Landlord's electric rates or
service classifications, subsequent to January 1, 1970, and so as to reflect any
increase in Landlord's electric charges, including changes in market prices for
electricity from utilities and/or other providers, in fuel adjustments or by
taxes or charges of any kind imposed on Landlord's electricity purchases or
redistribution, or for any other such reason, subsequent to said date. Any such
percentage increase in Landlord's billing for electricity due to changes in
rates, service classifications or market prices, shall be computed by the
application of the average consumption (energy and demand) of electricity for
the entire Building for the twelve (12) full months immediately prior to the
rate and/or service classification change, or any changed methods of or rules on
billing for same, applied on a consistent basis to the new rate and/or service
classification or market price, and to the classification and rate in effect on
January 1, 1970. If the average consumption of electricity for the entire
Building for said prior twelve (12) months cannot reasonably be applied and used
with respect to changed methods of or rules on billing, then the percentage
shall be computed by the use of the average consumption (energy and demand) for
the entire Building for the first three (3) months after such change, projected
to a full twelve (12) months, so as to reflect the different seasons; and that
same consumption, so projected, shall be applied to the service classification
and rate in effect on January 1, 1970. Where more than one meter measures the
service of Tenant in the Building, the service rendered through each meter may
be computed and billed separately in accordance with the rates herein specified.
Bills, therefore, shall be rendered at such times as Landlord may elect and the
amount, as computed from a meter, shall be deemed to be, and be paid as,
additional rent. In the event that such bills are not paid within thirty (30)
days after the same are rendered, Landlord may, without further notice,
discontinue the service of electric current to the demised Premises without
releasing Tenant from any liability under this Lease and without Landlord or
Landlord's agent incurring any liability for any damage or loss sustained by
Tenant by such discontinuance of service. If any tax is imposed upon Landlord's
receipt from the sale, resale or redistribution of electricity or gas or
telephone service to Tenant by any Federal, State or Municipal authority, Tenant
covenants and agrees that where permitted by law, Tenant's pro-rata share of
such taxes shall be passed on to and included in the bill of, and paid by,
Tenant to Landlord.
B. Rent Inclusion: If and so long as Landlord provides electricity to
the demised Premises on a rent inclusion basis, Tenant agrees that the fixed
annual rent shall be increased by the amount of the Electricity Rent Inclusion
Factor ("ERIF"), as hereinafter defined. Tenant acknowledges and agrees (i) that
the fixed annual rent hereinabove set forth in this Lease does not yet, but is
to include an ERIF of three ($3.00) dollars per rentable square foot to
compensate Landlord for electrical wiring and other installations necessary for,
and for its obtaining and making available to Tenant the redistribution of
electric current as an additional service; and (ii) that said ERIF, which shall
be subject to periodic adjustments as hereinafter provided, has been partially
based upon an estimate of the Tenant's connected electrical load, in whatever
manner delivered to Tenant, which shall be deemed to be the demand (KW),
- 1 -
<PAGE>
and hours of use thereof, which shall be deemed to be the energy (KWH), for
ordinary lighting and light office equipment and the operation of the usual
small business machines, including facsimile machines, desktop personal
computers and printers, desktop document scanners, Xerox or other copying
machines (such lighting and equipment are hereinafter called "Ordinary
Equipment") during ordinary business hours ("ordinary business hours") shall be
deemed to mean fifty (50) hours per week, with Landlord providing an average
connected load of four and a half (4 1/2) watts of electricity for all purposes
per rentable square foot. Any installation and use of equipment other than
Ordinary Equipment and/or any connected load and/or energy usage by Tenant in
excess of the foregoing shall result in adjustment of the ERIF as hereinafter
provided. For purposes of this Lease, the rentable square foot area of the
presently demised Premises shall be deemed to be eight thousand sixty-four
(8,064) square feet.
If the cost to Landlord of electricity shall have been, or shall be,
increased or decreased subsequent to May 1, 1996 (whether such change occurs
prior to or during the term of this Lease), by change in Landlord's electric
rates or service classifications, or electricity charges, including changes in
market prices or by an increase, subsequent to the last such electric rate or
service classification change or market price change, in fuel adjustments or
charges of any kind, or by taxes, imposed on Landlord's electricity purchases or
on Landlord's redistribution, or for any other such reason, then the aforesaid
ERIF portion of the fixed annual rent shall be changed in the same percentage as
any such change in cost due to changes in electric rates, service
classifications or market prices, and, also Tenant's payment obligation, for
electricity redistribution, shall change from time to time so as to reflect any
such increase in fuel adjustments or charges, and such taxes. Any such
percentage change in Landlord's cost due to change in Landlord's electric rate
or service classifications or market prices, shall be computed on the basis of
the average consumption of electricity for the Building for the twelve (12) full
months immediately prior to the rate change or other such changes in cost,
energy and demand, and any changed methods of or rules on billing for same,
applied on a consistent basis to the new electric rate or service classification
or market price and to the immediately prior exiting electric rate or service
classification or market price. If the average consumption (energy and demand)
for the entire Building for said prior twelve (12) months cannot reasonably be
applied and used with respect to changed methods of or rules on billing, then
the percentage increase shall be computed by the use of the average consumption
(energy and demand) for the entire Building for the first three (3) months after
such change, projected to a fill twelve (12) months, so as to reflect the
different seasons; and that same consumption, so projected, shall be applied to
the rate and/or service classification or market price which existed immediately
prior to the change. The parties agree that a reputable, independent electrical
consultant firm, selected by Landlord, ("Landlord's electrical consultant")
shall determine the percentage change for the changes in ERIF due to Landlord's
changed costs, and that Landlord's electrical consultant may from time to time
make surveys in the demised Premises at Landlord's sole cost and expense of the
electrical equipment and fixtures and use of current, except in the event that
any such survey is made at Tenant's request, in which event, Tenant shall pay on
demand as additional rent hereunder the cost of any such survey. (i) If such
survey shall reflect an adjusted demand electrical load in the demised Premises
in excess of four and a half (4 1/2) watts of electricity for all purposes per
rentable square foot and/or energy usage in excess of ordinary business hours
(each such excess hereinafter called "excess electricity") then the adjusted
demand electrical load and/or the hours of use portion(s) of the then existing
ERIF shall be increased by an amount which is equal to a fraction of the then
existing ERIF, the numerator of which is the excess electricity (i.e., excess
adjusted demand load and/or excess usage) and the denominator of which is the
adjusted demand load and/or the energy usage which was the basis of the then
existing ERIF. Such fractions shall be determined by Landlord's electrical
consultant. The fixed annual rent shall then be appropriately adjusted,
effective as of the date of any such change in adjusted demand load and/or
usage, as disclosed by said survey. (ii) If such survey shall disclose
installation and use of other than Ordinary Equipment, then effective as of the
date of said survey, there shall be added to the ERIF portion of fixed annual
rent (computed and fixed as hereinbefore described) an additional amount equal
to what would be paid under the SC-4 Rate I Service Classification in effect on
May 1, 1999 (and not the time of day rate schedule) or the comparable rate
schedule (and not the time of day rate schedule) of any utility other than Con
Ed then providing electrical service to the Building as same shall be in effect
on the date of such survey for such load and usage of electricity, with the
connected electrical load deemed to be the demand (KW) and the
- 2 -
<PAGE>
hours of use thereof deemed to be the energy (KWH), as hereinbefore provided
(which addition to the ERIF shall be increased or decreased by all electricity
cost changes of Landlord, as hereinabove provided, from May 1, 1999 through the
date of billing).
In no event, whether because of surveys, rates or cost changes, or for
any reason, is the originally specified three ($3.00) dollars per rentable
square foot ERIF portion of the fixed annual rent to be reduced.
C. General Conditions: The determination by Landlord's electrical
consultant shall be binding and conclusive on Landlord and Tenant from and after
the delivery of copies of such determinations to Landlord and Tenant, unless,
within thirty (30) days after delivery thereof, Tenant disputes such
determination. If Tenant so disputes the determination, it shall, at its own
expense, obtain from a reputable, independent electrical consultant its own
determinations in accordance with the provisions of this Article. Tenant's
consultant and Landlord's consultant then shall seek to agree. If they cannot
agree within thirty (30) days, they shall choose a third reputable electrical
consultant, whose cost shall be shared equally by the parties, to make similar
determinations which shall be controlling. (If they cannot agree on such third
consultant within ten (10) days, then either party may apply to the Supreme
Court in the County of New York for such appointment.) However, pending such
controlling determinations, Tenant shall pay to Landlord the amount of
additional rent or ERIF in accordance with the determinations of Landlord's
electrical consultant. If the controlling determinations differ from Landlord's
electrical consultant, then the parties shall promptly make adjustment for any
deficiency owed by Tenant or overage paid by Tenant.
Supplementing Article 34 hereof, if all or part of the sub-metering
additional rent or the ERIF payable in accordance with Subdivision (A) or (B) of
this Article becomes uncollectible or reduced or refunded by virtue of any law,
order or regulations, the parties agree that, at Landlord's option, in lieu of
sub-metering, additional rent or ERIF, and in consideration of Tenant's use of
the Building's electrical distribution system and receipt of redistributed
electricity and payment by Landlord of consultant's fees and other
redistribution costs, the fixed annual rental rate(s) to be paid under this
Lease shall be increased by an "alternative charge" which shall be a sum equal
to three ($3.00) dollars per year per rentable square foot of the demised
Premises, changed in the same percentage as any increase in the cost to Landlord
for electricity for the entire Building subsequent to May 1, 1999, because of
electric rate, service classification or market price changes, such percentage
change to be computed as in Subdivision (B) provided.
Landlord shall not be liable to Tenant for any loss or damage or
expense which Tenant may sustain or incur if either the quantity or character of
electric service is changed or is no longer available or suitable for Tenant's
requirements, unless caused by the negligence or willful misconduct of Landlord.
Notwithstanding the foregoing, in no event shall Landlord be liable to Tenant,
or anyone claiming through Tenant, for consequential damages. Tenant covenants
and agrees that at all times its use of electric current shall never exceed the
capacity of existing feeders to the Building or wiring installation. Tenant
agrees not to connect any additional electrical equipment to the Building
electric distribution system, other than lamps, typewriters, facsimile machines,
desktop personal computers and printers, desktop document scanners and other
small office machines which consume comparable amounts of electricity, without
Landlord's prior written consent, which consent shall not be unreasonably
withheld. Any riser or risers to supply Tenant's electrical requirements, upon
written request of Tenant, will be installed by Landlord, at the sole cost and
expense of Tenant, if, in Landlord's sole judgment, the same are necessary and
will not cause permanent damage or injury to the Building or demised Premises or
cause or create a dangerous or hazardous condition or entail excessive or
unreasonable alterations, repairs or expense or interfere with or disturb other
tenants or occupants. In addition to the installation of such riser or risers,
Landlord will also at the sole cost and expense of Tenant, install all other
equipment proper and necessary in connection therewith subject to the aforesaid
terms and conditions. The parties acknowledge that they understand that it is
anticipated that electric rates, charges, etc., may be changed by virtue of time
of day rates or changes in other methods of billing and/or electricity purchases
and the
- 3 -
<PAGE>
redistribution thereof, and fluctuation in the market price of electricity, and
that the references in the foregoing paragraphs to changes in methods of or
rules on billing are intended to include any such changes. Anything hereinabove
to the contrary notwithstanding, in no event is the sub-metering additional rent
or ERIF, or any "alternative charge," to be less than an amount equal to the
total Landlord's payments to public utilities and/or other providers for the
electricity consumed by Tenant (and any taxes thereon or on redistribution of
same) plus five (5%) percent thereof for transmission line loss, plus fifteen
(15%) percent thereof for other redistribution costs. The Landlord reserves,
subject to the introductory paragraph of this Article 40, the right, at any time
upon thirty (30) days written notice, to change its furnishing of electricity to
Tenant from a rent inclusion basis to a sub-metering basis, or vice versa, or to
change to the distribution of less than all the components of the existing
service to Tenant. The Landlord reserves the right to terminate the furnishing
of electricity on a rent inclusion, sub-metering, or any other basis at any
time, upon sixty (60) days written notice to the Tenant, provided the foregoing
change (i) is required by law, (ii) is required by the public utility company
supplying electricity to the Building or (iii) applies to fifty (50%) percent or
more of the office tenants in the Building, in which event the Tenant may make
application directly to the public utility and/or other providers for the
Tenant's entire separate supply of electric current and Landlord shall permit
its wires and conduits, to the extent available and safely capable, to be used
for such purpose, but only to the extent of Tenant's then authorized load. Any
meters, risers, or other equipment or connections necessary to furnish
electricity on an sub-metering basis or to enable Tenant to obtain electric
current directly from such utility and/or other providers shall be installed at
Landlord's sole cost and expense. Only rigid conduit or electricity metal tubing
(EMT) will be allowed. The Landlord, upon expiration of the aforesaid sixty (60)
days' written notice to the Tenant may discontinue furnishing the electric
current but this Lease shall otherwise remain in full force and effect, provided
such direct service is available to Tenant. If Tenant was provided electricity
on a rent inclusion basis when it was so discontinued, then commencing when
Tenant receives such direct service and as long as Tenant shall continue to
receive such service, the fixed annual rent payable under this Lease shall be
reduced by the amount of the ERIF which was payable immediately prior to such
discontinuance of electricity on a rent inclusion basis.
- 4 -
<PAGE>
DEFAULT
41. Supplementing Article 4 hereof:
A. In the event that Tenant is in arrears for rent or any item of
additional rent, after notice and beyond the expiration of any applicable cure
period set forth herein, Tenant waives its rights, if any, to designate the
items against which payments made by Tenant are to be credited and Landlord may
apply any payments made by Tenant to any items due hereunder which Landlord in
its sole discretion may elect irrespective of any designation by Tenant as to
the items against which any such payment should be credited.
B. If Landlord, as a result of any default by Tenant in its performance
of any of the terms, covenants, conditions and provisions of this Lease, which
default continues after applicable notice and the expiration of any applicable
cure period, makes any expenditures or incurs any obligations for the payment of
money including, without limitation, attorneys' fees, then any such cost,
expense or disbursement shall be deemed to be additional rent hereunder and paid
by Tenant to Landlord upon demand and, if Tenant's Lease terms shall have
expired after such expenditures or obligations have been incurred, such sums
shall be recoverable from Tenant as damages.
C. Tenant shall not seek to remove and/or consolidate any summary
proceeding brought by Landlord with any action commenced by Tenant in connection
with this Lease or Tenant's use and/or occupancy of the Premises.
D. In the event of a default by Landlord hereunder, no property or
assets of Landlord, or any principal, shareholders, officers, or directors of
Landlord, whether disclosed or undisclosed, other than the Building in which the
Premises are located and the land upon which the Building is situated, and any
refinancing proceeds, insurance proceeds, condemnation awards and rents relating
to the land and/or the Building 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 Landlord and Tenant hereunder or
Tenant's use and occupancy of the Premises.
- 5 -
<PAGE>
DESTRUCTION
42. Supplementing Article 10 hereof:
In no event that the Premises or portion thereof are damaged by fire or
other casualty and Landlord has elected not to terminate this Lease, Tenant
shall cooperate with Landlord in the restoration of the Premises and shall
remove from the Premises as promptly as reasonably possible all of Tenant's
salvageable inventory, movable equipment, furniture and other property. Tenant's
liability for rent shall resume sixty (60) days after written notice from
Landlord that Landlord's restoration work to the core and shell of the Premises
and Landlord's restoration to all components of work in the Premises performed
by Landlord prior to its delivery of possession to Tenant on the Commencement
Date shall have been substantially completed.
- 6 -
<PAGE>
INSURANCE
43. A. Tenant shall not violate, or permit the violation of, any condition
imposed by the standard fire insurance policy then issued for office buildings
in the Borough of Manhattan, City of New York, and shall not do, or permit
anything to be done, or keep or permit anything to be kept in the Premises which
would subject Lessor to any liability or responsibility for personal injury or
death or property damage, or which would increase the fire or other casualty
insurance rate on the Building or the property therein over the rate which would
otherwise then be in effect (unless Tenant pays the resulting premium as
provided in Section C hereof) or which would result in insurance companies of
good standing refusing to insure the Building or any of such property in amount
reasonably satisfactory to Lessor.
B. Tenant covenants to provide on or before the earlier to occur of (i)
the Commencement Date, and (ii) ten (10) days from the date of this Lease, and
to keep in force during the term hereof the following insurance coverage which
coverage shall be effective on the Commencement Date:
(a) A comprehensive policy of liability insurance naming Landlord as
an additional insured protecting Landlord and Tenant against any liability
whatsoever occasioned by accident on or about the Premises or any appurtenances
thereto. Such policy shall have limits of liability of not less than three
million ($3,000,000.00) dollars combined single limit coverage on a per
occurrence basis, including property damage. Such insurance may be carried under
a blanket policy covering the Premises and other locations of Tenant, if any,
provided such a policy contains an endorsement (i) naming Landlord as an
additional insured, (ii) specifically referencing the Premises; and (iii)
guaranteeing a minimum limit available for the Premises equal to the limits of
liability required under this Lease;
(b) Fire and Extended coverage in an amount adequate to cover the
cost of replacement of all personal property, fixtures, furnishings and
equipment, including Tenant's Alteration Work, located in the Premises.
All such policies shall be issued by companies of recognized
responsibility licensed to do business in New York State and rated by Best's
Insurance Reports or any successor publication of comparable standing and
carrying a rating of A- VIII or better or the then equivalent of such rating,
and all such policies shall contain a provision whereby the same cannot be
canceled or modified unless Landlord and any additional insured are given at
least thirty (30) days' prior written notice of such cancellation or
modification.
Prior to the time such insurance is first required to be carried by
Tenant, and thereafter, at least fifteen (15) days prior to the expiration of
any such policies, Tenant shall deliver to Landlord either duplicate originals
of the aforesaid policies or certificates evidencing such insurance, together
with evidence of payment for the policy. If Tenant delivers certificates as
aforesaid Tenant, upon reasonable prior notice from Landlord, shall make
available to Landlord, at the Premises, duplicate originals of such policies
from which Landlord may make copies thereof, at Landlord's cost. Tenant's
failure to provide and keep in force the aforementioned insurance shall be
regarded as a material default hereunder, entitling Landlord to exercise any or
all of the remedies as provided in this Lease in the event of Tenant's default.
In addition, in the event Tenant fails to provide and keep in force the
insurance required by this Lease, at the times and for the durations as
specified in this Lease, Landlord shall have the right, but not the obligation,
at any time and from time to time, and without notice, to procure such insurance
and/or pay the premiums for such insurance in which event Tenant shall repay
Landlord within five (5) days after demand by Landlord, as additional rent, all
sums so paid by Landlord and any costs or expenses incurred by Landlord in
connection therewith without prejudice to any other rights and remedies of
Landlord under this Lease.
C. Landlord and Tenant shall each endeavor to secure an appropriate
clause in, or an endorsement upon, each fire or extended coverage policy
obtained by it and covering the Building, the
- 7 -
<PAGE>
Premises or the personal property, fixtures and equipment located therein or
thereon, pursuant to which the respective insurance companies waive subrogation
or permit the insured, prior to any loss, to agree with a third party to waive
any claim it might have against said third party. The waiver of subrogation or
permission for waiver of any claim hereinbefore referred to shall extend to the
agents of each party and its employees and, in the case of Tenant, shall also
extend to all other persons and entities occupying or using the Premises in
accordance with the terms of this Lease. If and to the extent that such waiver
or permission can be obtained only upon payment of an additional charge then,
except as provided in the following two paragraphs, the party benefiting from
the waiver or permission shall pay such charge upon demand, or shall be deemed
to have agreed that the party obtaining the insurance coverage in question shall
be free of any further obligations under the provisions hereof relating to such
waiver of permission.
In the event that Landlord shall be unable at any time to obtain one
of the provisions referred to above in any of its insurance policies, at
Tenant's options, Landlord shall cause Tenant to be named in such policy or
policies as one of the insureds, but if any additional premium shall be imposed
for the inclusion of Tenant as such as insured, Tenant shall pay such additional
premium upon demand. In the event that Tenant shall have been named as one of
the insureds in any of the Landlord's policies in accordance with the foregoing,
Tenant shall endorse promptly to the order of Landlord, without recourse, any
check, draft or order for the payment of money representing the proceeds of nay
such policy or any other payment growing out of or connected with said policy
and Tenant hereby irrevocably waives any and all right in and to such proceeds
and payments.
In the event that Tenant shall be unable at any time to obtain one
of the provisions referred to above in any of its insurance policies, Tenant
shall cause Landlord to be named in such policy or policies as one of the
insureds, but if any additional premium shall be imposed for the inclusion of
Landlord as such an assured, Landlord shall pay such additional premium upon
demand or Tenant shall be excused from its obligations under this paragraph with
respect to the insurance policy or policies for which such additional premiums
would be imposed. In the event that Landlord shall have been named as one of the
insureds in any of Tenant's policies in accordance with this foregoing, Landlord
shall endorse promptly to the order of Tenant, without recourse, any check,
draft or order for the payment of money representing the proceeds of any such
policy or any other payment growing out of or connected with said policy and
Landlord hereby irrevocably waives any and all rights in and to such proceeds
and payments.
Subject to the foregoing provisions of this Section C, and insofar
as may be permitted by the terms of the insurance policies carried by it, each
party hereby releases the other with respect to any claim (including a claim for
negligence) which it might otherwise have against the other party for loss,
damages or destruction with respect to its property by fire or other casualty
(including rental value or business interruption, as the case may be) occurring
during the term of this Lease.
D. If, by reason of a failure of Tenant to comply with the provisions
of Article 14 or Section A above, the rate of fire insurance with extended
coverage on the Building or equipment or other property of Landlord shall be
higher than it otherwise would be, Tenant shall reimburse Landlord, on demand,
for that part of the premiums for fire insurance and extended coverage paid by
Landlord because of such failure on the part of Tenant.
E. Landlord may, from time to time, require that the amount of the
insurance to be provide and maintained by Tenant under Section B hereof be
increased so that the amount thereof adequately protects Landlord's interest,
but in no event in excess of the amount that would be required by other tenants
in other similar office buildings in the Borough of Manhattan. Notwithstanding
the foregoing, Landlord and Tenant acknowledge and agree that in no event shall
the amount of insurance to be provided and maintained by Tenant under the terms
of this Article be increased prior to the first anniversary of the commencement
of the term of this Lease and in no event shall the amount of said insurance
provided and maintained by Tenant during the term of this Lease be greater than
the sum of five million ($5,000,000.00) dollars.
- 8 -
<PAGE>
F. A schedule or make up of rates for the Building or the Premises, as
the case may be, issued by the New York Fire Insurance Rating Organization or
other similar body making rates for fire insurance and extended coverage for the
Premises concerned, shall be conclusive evidence of the facts therein stated and
of the several items and charges in the fire insurance rate with extended
coverage then applicable to such Premises.
G. Each policy evidencing the insurance to be carried by Tenant under
this Lease shall contain a clause that such policy and the coverage evidenced
thereby shall be primary with respect to any policies carried by Landlord, and
that any coverage carried by Landlord shall be excess insurance.
- 9 -
<PAGE>
SUBORDINATION
44. Supplementing the provisions of Article 12 hereof:
A. This Lease is and shall be subject and subordinate to all present
and future ground leases, underlying leases and to all subleases of the entire
Premises demised by that certain ground lease (hereinafter referred to as the
"Mense Lease") dated December 30, 1957 and recorded in the office of the
Register of the City of New York in the County of New York on December 31, 1957,
in Liber 5024 of Conveyances, Page 430 of which the Premises hereby demised form
a part (the Mense Lease and any or all present and future ground leases
underlying leases and subleases of the entire Premises demised by the Mense
Lease are hereunder referred to as the "ground lease" and the lessors and
lessees thereunder are hereinafter referred to respectively as the "ground
lessors" and "ground lessees") and to all renewals, modifications, replacements
and extensions of the ground leases, and to all present and future mortgages
affecting such ground leases (such mortgages are hereinafter referred to as the
"mortgages" and the mortgagees thereunder are hereinafter referred to as the
"the mortgagees") including, without limitation, that certain Amended and
Restated Indenture of Leasehold Mortgage, Security Agreement, Financing
Statement, Fixture Filing and Assignment of leases, Rents and Security Deposits,
dated as of May 21, 1999 by and between SLG Graybar Mense Lease LLC and SLG
Graybar Sublease LLC, a mortgagor, and German American Capital Corporation, as
mortgagee, and to all renewals, modifications, replacements and extensions of
the mortgages. Landlord represents that the Mense Lease is in full force and
effect and that the term thereof is scheduled to expire after the term of this
Lease is scheduled to expire.
B. Notwithstanding the subordination of this Lease to all ground leases
and mortgages, this Lease shall not terminate or be terminable by Tenant by
reason of the expiration or earlier termination or cancellation of any ground
lease in accordance with its terms or by reason of the foreclosures of any
mortgage, except that this Lease may be terminated if Tenant is named as a party
and served with process in a summary or other proceeding brought by the lessor
under the Mense Lease (hereinafter referred to as the "Mense Lessor") for the
possession of the Premises demised by the Mense Lease or the space occupied by
Tenant, or in such proceeding brought with the written consent of the Mense
Lessor delivered to Tenant, and a final order or judgment is entered, and a
warrant for possession of such space issued and executed against the defendants
or respondents in such proceedings.
C. Tenant agrees that if this Lease terminates, expires or is canceled
for any reason or by any means whatsoever (other than by a summary or other
proceeding brought by the Mense Lessor or with the Mense Lessor's written
consent delivered to Tenant, in which summary or other proceeding Tenant is made
a party and in which a final order or judgment is entered and warrant for
possession is issued and executed against Tenant) and Mense Lessor or a ground
lessor so elects by written notice to Tenant, this Lease shall automatically be
reinstated for the balance of the term which would have remained but for such
termination, expiration or cancellation, at the same rental, and upon the same
agreements, covenants, conditions, restrictions and provisions herein contained,
with the same rental, and upon the same agreements, covenants, conditions,
restrictions and provisions herein contained, with the same force and effect as
if no such termination, expiration or cancellation had taken place. Tenant
covenants to execute and deliver any instrument required to confirm the validity
of the foregoing. Anything herein contained to the contrary notwithstanding,
this Lease shall not be deemed to be automatically reinstated as aforesaid, nor
shall Tenant be obligated to execute and deliver any instrument confirming such
reinstatement, if Tenant has delivered to the Mense Lessor and any ground lessor
so electing a notice that in Tenant's option this Lease has so terminated,
expired or been canceled, and neither the Mense Lessor nor such other ground
lessor has, within thirty (30) days after receipt of such notice from Tenant,
delivered notice to Tenant of its election automatically to reinstate this
Lease.
D. Tenant hereby consents to any and all assignment of Landlord's
interest in this Lease to any ground lessor or mortgagee as collateral security
for the payment of the ground rent or monies due under any mortgage. Tenant
agrees to attorn to and pay rent to any such ground lessor's or mortgagee in
- 10 -
<PAGE>
accordance with the provisions of any such assignment provided such rental
payments shall be applied against rent due hereunder.
E. Tenant agrees that no act, or failure to act, on the part of
Landlord, which would entitle Tenant under the terms of this Lease, or by law to
be relived of Tenant's obligations hereunder or to terminate this Lease, shall
result in a release or termination of such obligations or termination of this
Lease unless (i) Tenant shall have first given written notice of Landlord's act
or failure to act to the ground lessors under all then existing ground leases,
to all then existing mortgages who have requested such notice from Tenant, and
to German American Capital Corporation, as mortgagee, at (i) 31 West 52nd
Street, New York, New York 10019, Attn.: General Counsel, and at (ii) Skadden,
Arps, Slate, Meagher & Flom, LLP, 919 Third Avenue, New York, New York 10022,
Attn.: Harvey Uris, Esq., specifying the act or failure to act on the part of
Landlord which could or would given basis to Tenant's rights and (ii) the ground
lessors and such mortgagees, after receipt of such notice, have failed or
refused to correct or cure the condition complained of within a reasonable time
thereafter but nothing herein contained shall be deemed to impose any obligation
on any ground lessor or such mortgagee to correct or cure any such condition
F. This Lease may not be modified or amended so as to reduce the rent,
shorten the term, or otherwise materially affect the rights of Landlord
hereunder, or be canceled or surrendered except as provided in subparagraph (E)
of this Article 44, without the prior written consent in each instance of the
ground lessors and of any mortgagees whose mortgages shall require such consent.
Any such modification, agreement, cancellation or surrender made without such
prior written consent shall be null and void.
- 11 -
<PAGE>
AIR CONDITIONING
45. Supplementing the provisions of Article 9 hereof, Landlord shall
provide air conditioning to the Premises, through the presently existing
equipment and facilities servicing the Premises, from May 15th to October 15th
in each year during the term of the Lease. Monday through Friday from 8 a.m. to
6 p.m., and on Saturdays from 8:00 am to 12:00 Noon (after hours air
conditioning to be furnished, after reasonable advance request by Tenant in
writing, at Landlord's then standard building rates for same). Tenant shall
reimburse Landlord, in accordance with Article 40 of this Lease, for electricity
consumed by such equipment and facilities in providing air conditioning to the
Premises. Tenant acknowledges and agrees that the air conditioning equipment and
facilities servicing the Premises are Landlord's property, however, Tenant shall
keep, maintain and repair such equipment and all of the facilities including,
without limitation, the ducts, dampers, registers, grilles and appurtenances
utilized in connection therewith: In connection therewith, Tenant shall at all
times during the term hereof contract for and maintain regular service of said
air conditioning equipment and related facilities through an independent,
licensed, professional third-party maintenance company approved by Landlord and
shall, within (30) days of the commencement of the term of this Lease, forward
to Landlord a fully executed original copy of such contract. Tenant shall also
forward to Landlord within thirty (30) days of their execution by the parties
thereto any and all renewals and modifications thereof. Said contract shall
include the thorough overhauling of the air conditioning systems and facilities
servicing the Premises at least once each year during the term of this Lease.
Any restoration or replacement by Tenant of all or any part of the air
conditioning equipment shall be in quality and class equal to the original work
or installations. In the event that Tenant fails to perform the aforementioned
maintenance and repair of the existing air conditioning equipment and facilities
servicing the Premises or fails to enter into and maintain the referenced
service contract Landlord may following twenty (20) days' written notice to
Tenant and Tenant's failure to cure such non-performance, at Tenant's sole cost
and expense payable by Tenant upon demand as additional rent hereunder, perform
any necessary maintenance or enter into such service contract for the Premises.
Provided that Tenant performs the referenced maintenance and repair of the
existing air conditioning equipment and enters into the above-referenced service
contract, Landlord shall be responsible for the replacement, as necessary, of
major components of the air conditioning mechanical equipment (e.g., without
limitation, the compressor and pumps), provided that any such replacement are
not necessitated by the negligence or willful misconduct of Tenant, its
employees, representatives, servants or invitees, in which event Tenant shall be
solely responsible for the cost of same. If supplementary air conditioning
equipment and/or facilities are required to accommodate Tenant's special usage
areas (e.g., without limitation computer rooms, conference rooms,
cafeteria/lunchrooms or any special usage which subjects a portion or the entire
Premises to a high density of office personnel and/or heat generating machinery
or appliances), it shall be Tenant's responsibility to furnish, install,
maintain, repair and operate, subject to Landlord's written approval, which
approval shall not be unreasonably withheld, any necessary supplementary air
conditioning equipment and/or facilities at its sole cost and expense. Landlord
reserve the right to suspend the operation of all air conditioning equipment and
facilities at any time that Landlord, in its sole judgment, deems it necessary,
including without limitation, accidents, emergencies, repairs, alterations, or
improvements in the Premises or the Building. Tenant agrees that any such
suspension in the operation of the air conditioning equipment and/or facilities
may continue until such time as the basis for such suspension has been remedied
and that Landlord shall not be responsible or liable to Tenant for any damages
suffered by Tenant in connection therewith subject to the terms of this Lease
and unless resulting from Landlord's negligence or willful misconduct. Tenant
further agrees that Landlord shall not be responsible or liable for any damages
suffered by Tenant if operation of the air conditioning equipment and/or
facilities is prevented by labor unrest, strikes, shortages or accidents or any
cause beyond Landlord's reasonable control, or by the orders or regulations of
any Federal, State, County or local authority or by failure of the equipment
and/or facilities or electrical current, steam and/or water or other necessary
power source.
- 12 -
<PAGE>
CHANGES AND ALTERATIONS
46. Anything in Article 7 to the contrary notwithstanding, Landlord will
not unreasonably withhold, condition or delay approval of written requests of
Tenant to make nonstructural interior alterations, decorations, additions and
improvements (herein referred to as "alterations") in the demised Premises,
provided that such alterations do no affect utility services or plumbing and
electrical lines or other systems of the Building. All alterations shall be
preformed in accordance with the following conditions:
(a) All alterations costing more than fifteen thousand ($15,000.00)
dollars shall be performed in accordance with plans and specifications first
submitted to Landlord for its prior written approval. Landlord shall be given,
in writing, a good description of all other alterations.
(b) All alterations shall be done in a good and workmanlike manner.
Tenant shall, prior to commencement of any such alterations, at its sole cost
and expense, obtain or cause to be obtained and exhibit to Landlord any
governmental permit required in connection with such alterations.
(c) All alterations shall be done in compliance with all other
applicable provisions of this Lease and with all applicable laws, ordinances,
directions, rules and regulations of governmental authorities having
jurisdiction, including, without limitation, the Americans with Disabilities Act
of 1990 and New York City Local Law No. 57/87 and similar present or future
laws, and regulations issued, pursuant thereto, and also New York City Local Law
No. 76 and subject to the terms of Article 56, and similar present or future
laws, and regulations issued pursuant thereto, on abatement, storage,
transportation and disposal of asbestos, which work, if required, shall be
effected at Tenant's sole cost and expense, by contractors and consultants
approved by Landlord and in strict compliance with the aforesaid rules and
regulations and with Landlord's rules and regulations thereon.
(d) All work shall be performed with union labor having the proper
jurisdictional qualifications.
(e) Tenant shall keep the Building and the demised Premises free and
clear of all liens for any work or material claimed to have been furnished to
Tenant or to the demised Premises.
(f) Prior to the commencement of any work by or for Tenant, Tenant
shall furnish to Landlord certificates evidencing the existence of the following
insurance:
(i) Workmen's compensation insurance covering all persons employed
for such work and with respect to whom death or bodily injury claims could be
asserted against Landlord, Tenant or the demised Premises.
(ii) Board form general liability insurance written on an occurrence
basis naming Tenant as an insured and naming Landlord and its designees as
additional insureds, with limits not less than three million ($3,000,000.00)
dollars combined single limit for personal injury in any one occurrence, and
with limits of not less than five hundred thousand ($500,000.00) dollars for
property damage (the foregoing limits may be revised from time to time by
Landlord to such higher limits as Landlord from time to time reasonably
requires). Tenant at its sole cost and expense, shall cause all such insurance
to be maintained at all time when the work to be performed for or by Tenant is
in progress. All such insurance shall be obtained from a company authorized to
do business in New York and shall provide that it cannot be canceled without
thirty (30) days' prior written notice to Landlord. All policies, or
certificates therefor, issued by the insurer and bearing notations evidencing
the payment of premiums, shall be delivered to Landlord. Blanket coverage shall
be acceptable, provided that coverage meeting the requirements of this paragraph
is assigned to Tenant's location at the demised Premises.
(g) All work to be performed by Tenant shall be done in a manner which
will not unreasonably interfere with or disturb other tenants and occupants of
the Building.
- 13 -
<PAGE>
(h) Any alterations or other work and installations in and for the
demised Premises, which shall be consented to by Landlord as provided herein if
effected on Tenant's behalf at Tenant's requests by Landlord, its agents or
contractors, and shall be paid for by the Tenant promptly when billed, at cost
plus ten (10%) percent thereof for supervision and overhead, plus ten (10%)
percent for general conditions, as additional rent hereunder.
- 14 -
<PAGE>
LANDLORD'S WORK
47. (a) Tenant has examined and agrees to accept the leased Premises in
their existing condition and state of repair and understands that no work is to
be performed by Landlord, except that Landlord's designated, wholly owned
affiliate Emerald City Construction Corp., with reasonable dispatch, subject to
delay by causes beyond its control or by the action or inaction of Tenant, shall
perform the following work at Landlord's expense, subject to the provisions of
(b), below:
Landlord shall perform work in the Premises in a building standard
manner utilizing building standard materials pursuant to the layout and work
letter prepared by Design Consortium, drawing number PSA-5A, dated November 17,
1999 attached hereto and made a part hereof (the "Layout"). In supplement
thereof, Tenant shall prepare, at its sole cost and expense, and submit to
Landlord within fourteen (14) days of the execution and delivery of this Lease
by the parties hereto construction documents necessary for Landlord to perform
the work contained in the Layout ("Landlord's Work"), which construction
documents shall be subject to the prior approval, provided that any variation
between said construction documents and the Layout shall not increase Landlord's
cost in its performance of Landlord's Work in the Premises. The aforementioned
construction documents prepared by Tenant shall be suitable for filing with the
Building Department of the City of New York. The performance by Landlord of
Landlord's Work is expressly conditioned upon compliance by Tenant with all the
terms and conditions of this Lease, including payment of rent.
The performance by Landlord of Landlord's work is expressly
conditioned upon compliance by Tenant with all the terms and conditions of this
Lease, including payment of rent.
(b) Any changes in or additions to the work and installations mentioned
in paragraph (a) above which shall be consented to by Landlord as provided in
Article 7 hereof, and further changes in or additions to be demised Premises
after said work has been completed which shall be so consented to shall be made
by Landlord, or its agents, but shall be paid for by Tenant promptly when billed
at COST PLUS ONE AND ONE QUARTER (1 1/4%) PERCENT FOR INSURANCE, TEN (10%)
PERCENT FOR OVERHEAD AND TEN (10%) PERCENT FOR GENERAL CONDITIONS, and in the
event of the failure of Tenant so to pay for said changes or additions, Landlord
at its option may consider the cost thereof, PLUS THE ABOVE PERCENTAGES, as
additional rent payable by Tenant and collectible as such hereunder, as part of
the rent for the next ensuing months.
(c) If Landlord's Work is substantially completed prior to the date
first above set forth for the commencement of the term, then the term shall
commence on the day ten (10) days following notice of such completion of
Landlord's Work or upon occupancy of the Premises and shall expire on date set
forth above as the expiration date. If the commencement term is other than the
first (1st) day of a month, rent for the first (1st) month shall be adjusted.
(d) If Landlord's Work is not substantially completed and is delayed by
acts, omissions or changes made or requested by Tenant, its agents, designers,
architects or any other party acting or apparently acting on Tenant's behalf,
then Tenant shall pay as hereinbefore provided rent and additional rent on a per
diem basis for each day of delay of Landlord's substantial completion caused by
Tenant or any of the aforementioned parties.
(e) Landlord's Work shall be deemed to be substantially completed
notwithstanding that (i) minor or non-material details of construction,
mechanical adjustment or decoration remain to be performed, provided, that said
"Punch List Items" shall be completed by Landlord within a reasonable time
thereafter or (ii) a portion of Landlord's Work is incomplete because
construction scheduling requires that such work be done after incomplete
finishing or after other work to be done by or on behalf of Tenant is completed.
(f) Tenant acknowledges and agrees that Landlord may be performing
Landlord's Work or portion thereof simultaneously with Tenant's performance of
its initial alteration work in the demised
- 15 -
<PAGE>
Premises, and that Tenant shall use reasonable efforts to coordinate with
Landlord's affiliate, Emerald City Construction Corp., any such work performed
by or on behalf of Tenant in the demised Premises.
- 16 -
<PAGE>
SIGNS
48. Supplementing Article 5 of the Rules and Regulations:
Tenant shall be permitted to affix a suitable sign, plaque or applied
lettering made of brass or bronze on the entrance door of the demised Premises,
subject to the prior written approval of Landlord with respect to location,
number, type, size, shape and design thereof, and subject, also, to compliance
by Tenant, at its expense, with all applicable legal requirements or
regulations.
- 17 -
<PAGE>
BROKERAGE
49. A. Tenant represents and warrants to Landlord that it did not consult
or negotiate with any broker, finder, or consultant with regard to the Premises
other than SL Green Leasing, Inc., and that no other broker, finder or
consultant participated in procuring this Lease. Tenant hereby indemnifies and
agrees to defend and hold Landlord, its agents, servants and employees harmless
from any suit, action, proceeding, controversy, claim or demand whatsoever at
law or in equity that may be instituted against Landlord by anyone for recovery
of compensation or damages for procuring this Lease or by reason of a breach or
purported breach of the representations and warranties contained herein.
B. Landlord represents and warrants to Tenant that it did not consult
or negotiate with any broker, finder, or consultant with regard to the Premises
other than SL Green Leasing, Inc., and that no other broker, finder or
consultant participated in procuring this Lease. Landlord hereby indemnifies and
agrees to defend and hold Tenant, its agents, servants and employees harmless
from any suit, action, proceeding, controversy, claim or demand whatsoever at
law or in equity that may be instituted against Tenant by those who dealt with
Tenant for recovery of compensation or damages for procuring this Lease or by
reason of a breach or purported breach of the representations and warranties
contained herein.
- 18 -
<PAGE>
FAILURE TO PROVIDE CONSENT
50. In no event shall Tenant be entitled to make, nor shall Tenant make any
claim, and Tenant hereby waives any claim for money damages (nor shall Tenant
claim any money damages by way of set-off, counterclaim or defense) based upon
any claim or assertion by Tenant that Landlord had unreasonably withheld,
delayed or conditioned its consent or approval to any request by Tenant made
under a provision of this Lease. Tenant's sole remedy shall be an action or
proceeding to enforce any such provision, or for specific performance or
declaratory judgment which may be sought by arbitration before the American
Arbitration Association on an expedited basis. In the event that Tenant demands
arbitration under this Article, Landlord and Tenant shall jointly select an
independent arbitrator (the "Arbitrator). In the event that Landlord and Tenant
shall be unable to jointly agree on the designation of the Arbitrator within
five (5) days after they are requested to do so by either party, then the
parties agree to allow the American Arbitration Association, or any successor
organization to designate the Arbitrator in accordance with the rules,
regulations and/or procedures for expedited proceedings then obtaining of the
American Arbitration Association of any successor organization. The Arbitrator
shall conduct such hearings and investigations as he may deem appropriate and
shall, within (10) days after the date of designation of the Arbitrator issue as
determination as to whether Landlord's refusal to consent was unreasonable. The
determination of the Arbitrator shall be conclusive and binding upon Landlord
and Tenant and shall be set forth, along and with the Arbitrator's rationale for
such choice, in a written report delivered to Landlord and Tenant. Each party
shall pay its own counsel fees and expenses, if any, in connection with any
arbitration under this Article. The Arbitrator appointed pursuant to this
Article shall be an independent real estate professional with at least ten (10)
years' experience in leasing of properties which are similar in character to the
Building. The Arbitrator shall not have the power to add to, modify or change
any of the provisions of this Lease but shall have the power to direct Landlord
to consent to such request.
- 19 -
<PAGE>
ASSIGNMENT AND SUBLETTING
51. Supplementing Articles 3 and 27 hereof:
A. Tenant, for itself, its heirs, distributees, executors,
administrators, legal representatives, successors and assigns, expressly
covenants that it shall not assign, mortgage or encumber this Lease, no
underlet, or suffer or permit the demised Premises or any part thereof to be
used or occupied by others, without the prior written consent of Landlord in
each instance. The merger or consolidation of a corporate tenant or subtenant
where the net worth of the resulting or surviving corporation is less than the
net worth of the tenant or subtenant immediately prior to such merger or
consolidation shall be deemed an assignment of this Lease or of such sublease.
If this Lease be assigned, or if the demised Premises or any part thereof be
underlet or occupied by anybody other than Tenant, Landlord may, after default
by Tenant, after notice and beyond the expiration of any applicable cure period,
collect rent from the assignee, undertenant or occupant, and apply the net
amount collected to the rent herein reserved, but no assignment, underletting,
occupancy or collection shall be deemed a waiver of the provisions hereof, the
acceptance of the assignee, undertenant or occupant as tenant, or a release of
Tenant from the further performance by Tenant of covenants on the part of Tenant
herein contained. The consent by Landlord to an assignment or underletting shall
not in any way be construed to relieve Tenant from obtaining the express consent
in writing of Landlord to any further assignment or underletting. In no event
shall any permitted subtenant assign or encumber its sublease or further sublet
all or any portion of its sublet space, or otherwise suffer or permit the sublet
space or any part thereof to be used or occupied by others, without Landlord's
prior written consent in each instance. A modification, amendment or extension
of a sublease shall be deemed a sublease. If any lien is filed against the
demised Premises or the Building of which the same form a part for brokerage
services claimed to have been performed for Tenant, other than by SL Green
Leasing, Inc., whether or not actually performed, the same shall be discharged
by Tenant within ten (10) days after Tenant receives notice thereof, at Tenant's
expenses, by filing the bond required by law, or otherwise, and paying any other
necessary sums, and Tenant agrees to indemnify Landlord and its agents and hold
them harmless from and against any and all claims, losses or liability resulting
from such lien for brokerage services rendered.
B. If Tenant desires to assign this Lease or to sublet all or any
portion of the demised Premises, it shall first submit in writing to Landlord
the documents described in Section C hereof, and shall offer in writing, (i)
with respect to a prospective assignment, to assign this Lease to Landlord
without any payment of moneys or other consideration thereof, or (ii) with
respect to a prospective subletting, to sublet to Landlord the portion of the
demised Premises involved ("Leaseback Area") for the term specified by Tenant in
its proposed sublease or, at Landlord's option for the balance of the term of
the Lease less one (1) day, and at the lower of (a) Tenant's proposed subrental
or (b) at the same rate of fixed rent and additional rent, and otherwise on the
same terms, covenants and conditions (including provisions relating to
escalation rents), as are contained herein and as are allocable and applicable
to the portion of the demised Premises to be covered by such subletting. The
offer shall specify the date when the Leaseback Area will be made available to
Landlord, which date shall be in no event earlier than thirty (30) days nor
later than one hundred eighty (180) days following the acceptance of the offer.
If an offer of sublease is made, and if the proposed sublease will result in all
or substantially all of the demised Premises being sublet, then Landlord shall
have the option to extend the term of its proposed sublease for the balance of
the term of this Lease less one (1) day.
Landlord shall have a period of thirty (30) days from the receipt of
such offer to either accept or reject the same. If Landlord shall accept such
offer, Tenant shall then execute and deliver to Landlord, or to anyone
designated or named by Landlord, an assignment or sublease, as the case may be,
in either case in a form reasonably satisfactory to Landlord's counsel.
If a sublease is so made it shall expressly:
- 20 -
<PAGE>
(a) permit Landlord to make further subleases of all or any part of
the Leaseback Area and (at no cost or expense to Tenant) to make and authorize
any and all changes, alterations, installations and improvements in such space
as necessary, provided that Tenant shall have no liability to restore any
alterations made by Landlord or its subtenant;
(b) provide the Tenant will at all times permit reasonably
appropriate means of ingress to and egress from the Leaseback Area;
(c) negate any intention that the estate created under such sublease
be merged with any other estate held by either of the parties;
(d) provide that Landlord shall accept the Leaseback Area "as is"
except that Landlord, at Tenant's reasonable expense, shall perform all such
work and make all such alterations as may be required physically to separate the
Leaseback Area from the remainder of the demised Premises and to permit lawful
occupancy, it being intended that Tenant shall have no other cost or expense in
connection with the subletting of the Leaseback Area;
(e) provide that the expiration of the term of such sublease (which
shall be one day prior to the expiration date of this Lease) Tenant will accept
the Leaseback Area in its then existing condition, subject to the foregoing, and
subject to the obligations of Landlord to make such repairs thereto as may be
necessary to preserve the Leaseback Area in good order and condition, ordinary
wear and tear excepted.
Landlord shall indemnify and save Tenant harmless from all
obligations under this Lease as to the Leaseback Area during the period of time
it is so sublet, except for fixed annual rent and additional rent, if any, due
under the within Lease, which are in excess of the rents and additional sums due
under such sublease.
Subject to the foregoing, performance by Landlord, or its designee,
under a sublease of the Leaseback Area shall be deemed performance by Tenant of
any similar obligation under this Lease and any default under any such sublease
shall not give rise to a default under a similar obligation contained in this
Lease, nor shall Tenant be liable for any default under this Lease or deemed to
be in default hereunder if such default is occasioned by or arises from any act
or omission of the Tenant under such sublease or is occasioned by or arises from
any act or omission of any occupant holding under or pursuant to any such
sublease.
C. If Tenant requests Landlord's consent to a specific assignment or
subletting, it shall submit in writing to Landlord (i) the name and address of
the proposed assignee or subtenant, (ii) a duly executed counterpart of the
proposed agreement of assignment or sublease, (iii) reasonably satisfactory
information as to the nature and character of the business of the proposed
assignee or subtenant and as to the nature of its proposed use of the space, and
(iv) banking, financial or other credit information relating to the proposed
assignee or subtenant reasonably sufficient to enable Landlord to determine the
financial responsibility and character of the proposed assignee or subtenant.
D. If Landlord shall not have accepted Tenant's offer, as provided in
Section B, then Landlord will not unreasonably withhold or delay its consent to
Tenant's request for consent to such specific assignment or subletting. Any
consent of Landlord under this Article shall be subject to the terms of this
Article and conditioned upon there being no default by Tenant, beyond any grace
period, under any of the terms, covenants and conditions of this Lease at the
time that Landlord's consent to any such subletting or assignment is requested
and on the date of the commencement of the term of any proposed sublease or the
effective date of any proposed assignment.
E. Tenant understands and agrees that no assignment or subletting shall
be effective unless and until Tenant, upon receiving any necessary Landlord's
written consent (and unless it was theretofore
- 21 -
<PAGE>
delivered to Landlord) causes a duly executed copy of the sublease or assignment
to be delivered to Landlord within ten (10) days after execution thereof. Any
such sublease shall provide that the subtenant shall comply with all applicable
terms and conditions of this Lease to be performed by the Tenant hereunder with
respect to the space so sublet. Any such assignment of Lease shall contain an
assumption by the assignee of all of the terms, covenants and conditions of this
Lease to be performed by the Tenant arising from and after the effective date of
such assignment.
F. Anything herein contained to the contrary notwithstanding:
1. Tenant shall not advertise (but may list with brokers) its space
for assignment or subletting at a rental rate lower than the greater of the then
Building rental rate for such space or the rental rate then being paid by Tenant
to Landlord.
2. The transfer of a majority of the issued and outstanding capital
stock of, or a controlling interest in, any corporate tenant or subtenant of
this Lease or a majority of the total interest in any partnership Tenant or
subtenant, however accomplished, and whether in a single transaction or in a
series of related or unrelated transactions, shall be deemed an assignment of
this Lease of such sublease. The transfer of outstanding capital stock of any
corporate tenant, for purposes of this Article, shall not include sale of such
stock by persons other than those deemed "insiders" within the meaning of the
Securities Exchange Act of 1934 as amended, and which sale is affected through
"over-the-counter market" or through any recognized stock exchange.
3. No assignment or subletting shall be made:
(a) To any person or entity which shall at that time be a tenant,
subtenant or other occupant of any part of the Building of which the demised
Premises form a part, or who dealt with Landlord or Landlord's agent (directly
or through a broker) with respect to space in the Building during the six (6)
months immediately proceeding Tenant's request for Landlord's consent;
(b) By legal representatives of the Tenant or by any person to
whom Tenant's interest under this Lease passes by operation of law, except in
compliance with the provision of this Article;
(c) To any person or entity for the conduct of a business which
is not in keeping with the standards and the general character of the Building
of which the demised Premises form a part.
(d) To any entity which is entitled to diplomatic or sovereign
immunity or which is not subject to service of process in the State of New York
or to the jurisdiction of the courts of the State of New York and the United
States located in New York County.
G. Anything hereinabove contained to the contrary notwithstanding, the
offer back to Landlord pursuant to the provisions of Section B hereof shall not
apply to, and Landlord will not unreasonably withhold or delay its consent to an
assignment of this Lease, or sublease of all or part of the demised Premises, to
the parent of Tenant or to a wholly-owned subsidiary of Tenant or of said parent
of Tenant, provided the net worth of transferor or sublandlord, after such
transaction, is equal to or greater than its net worth immediately prior to such
transaction, and provided also that any such transaction complies with the other
provisions of this Article.
H. Anything hereinabove contained to the contrary notwithstanding, the
offer back to Landlord pursuant to the provisions of Section B hereof shall not
apply to, and Landlord will not unreasonably withhold or delay its consent to an
assignment of this Lease, or sublease of all or part of the demised Premises, to
any corporation (i) to which substantially all the assets of Tenant are
transferred or (ii) into which Tenant may be merged or consolidated, provided
that the net worth, experience and
- 22 -
<PAGE>
reputation of such transferee or of the resulting or surviving corporation, as
the case may be, is equal to or greater than the net worth experience and
reputation of Tenant and of any guarantor of this Lease immediately prior to
such transfer and provided, also, that any such transaction complies with the
other provisions of this Article.
No consent from Landlord shall be necessary under Subdivision G and
H hereof where (i) reasonably satisfactory proof is delivered to Landlord that
the net worth and other provisions of G or H, as the case may be, and the other
provisions of this Article, have been satisfied and (ii) Tenant, in a writing
reasonably satisfactory to Landlord's attorneys, agrees to remain primarily
liable jointly and severally with any transferee or assignee, for the
obligations of Tenant under this Lease, except that such writing shall not be
necessary with regard to Subdivision H(ii).
I. If Landlord shall not have accepted any required Tenant's offer
and/or Tenant effects any assignment or subletting, then Tenant thereafter shall
pay to Landlord a sum equal to fifty (50%) percent of (a) any rent or other
consideration paid to Tenant by any subtenant which (after (i) deducting the
cost of Tenant, if any, in effecting the subletting, including reasonable
alteration costs, commissions and legal fees and (ii) excluding from such sums
any consideration paid solely for the sale of Tenant's business or Tenant's
assets) is in excess of the rent allocable to the subleased space which is ten
being paid by Tenant to Landlord pursuant to the terms hereof, and (b) any other
profit or gain (after deducting any necessary expenses incurred) realized by
Tenant from any such subletting or assignment. All sums payable hereunder by
Tenant shall be payable to Landlord as additional rent upon receipt thereof by
Tenant, provided that Tenant shall be entitled to recoup the sums set forth in
(a)(1) above prior to paying any such profits to Landlord.
J. In no event shall Tenant be entitled to make, nor shall Tenant make,
any claim, and Tenant hereby waives any claims, for money damages (nor shall
Tenant claim any money damages by way of set-off, counterclaim or defense) based
upon any claim or assertion by Tenant that Landlord has unreasonably withheld or
unreasonably delayed its consent or approval to a proposed assignment or
subletting as provided for in this Article. Tenant's sole remedy shall be an
action or proceeding to enforce any such provision, or for specific performance,
injunction or declaratory judgment which may be sought by arbitration before the
American Arbitration Association on an expedited basis. In the event that Tenant
demands arbitration under this Article, Landlord and Tenant shall jointly select
an independent arbitrator (the "Arbitrator"). In the event that Landlord and
Tenant shall be unable to jointly agree on the designation of the Arbitrator
within five (5) days after they are requested to do so by either party, then the
parties agree to allow the American Arbitration Association, or any successor
organization to designate the Arbitrator in accordance with the rules,
regulations and/or procedures for expedited proceedings then obtaining of the
American Arbitration Association of any successor organization. The Arbitrator
shall conduct such hearings and investigations as he may deem appropriate and
shall, within ten (10) days after the date of designation of the Arbitrator
issue a determination as to whether Landlord's refusal to consent was
unreasonable. The determination of the Arbitrator shall be conclusive and
binding upon Landlord and Tenant and shall be set forth, along and with the
Arbitrator's rationale for such choice, in a written report delivered to
Landlord and Tenant. Each party shall pay its own counsel fees and expenses, if
any, in connection with any arbitration under this Article. The Arbitrator
appointed pursuant to this Article shall be an independent real estate
professional with at least ten (10) years' experience in leasing of properties
which are similar in character to the Building. The Arbitrator shall not have
the power to add to, modify or change any of the provisions of this Lease but
shall have the power to direct Landlord to consent to such request.
- 23 -
<PAGE>
PORTER'S WAGE ESCALATION
52. Tenant shall pay to Landlord, as additional rent, Porter's Wage
escalation, in accordance with this Article:
(a) DEFINITIONS: For the purpose of this Article, the following
definitions shall apply:
(i) The term "Base Rate" as hereinafter set forth for the
determination of Porter's Wage escalation, shall mean the labor rate determined
as hereinafter provided, as of the first day of the calendar year 1999 (the
"base year"). The term "comparative year" shall mean each calendar year, or
portion thereof, subsequent to the base year.
(ii) For purposes of this Lease, the rentable square foot area of
the presently demised Premises shall be deemed to be 8,064 square feet.
(iii) The term "labor rate" shall mean the average of the premium
regular hourly wage rate, (without fringe benefits) plus any taxes applicable
thereto, (1) for a porter and (2) for an office cleaner, determined as follows:
(1) The minimum regular hourly wage rate for porters with five
(5) years' service in Class A office buildings, from time
to time established by Agreement between the Realty
Advisory Board on Labor Relations, Inc., and Local 32B-32J
of the Building Service Employees International Union
AFL-CIO or by the successors to either or both of them;
(this rate shall be used in computations under this
Article whether or not porters' wages are actually paid by
or for the Landlord or by independent contractors who
furnish such services to the demised Premises or to the
Building).
(2) The minimum regular hourly wage rate for office cleaners
with five (5) years' service in Class A office buildings,
from time to time established by agreement between the
Realty Advisory Board on Labor Relations, Inc., and Local
32B-32J of the Building Service Employees International
Union AFL-CIO or by the successors to either or both of
them; (this rate shall be used in computations under this
Article whether or not office cleaners' wages are actually
paid by or for the Landlord or by independent contractors
who furnish such services to the demised Premises or to
the Building).
(3) As used herein, the term "porters" and the term "office
cleaners" shall mean, respectively, that classification of
employee engaged in the general maintenance and operation
of office buildings most nearly comparable to that
classification now applicable to porters or office
cleaners, as the case may be, in the 1996-98 Agreement, as
renewed with said Local 32B-32J (which classification is
presently termed "others" in said Agreement).
(4) If any such union agreement shall require the regular
employment of porters or office cleaners on days or during
hours when overtime or other premium pay rates are in
effect, then the minimum "regular hourly wage rate" as
used above and subject to the other adjustments provided
for herein, shall be deemed to mean the average hourly
wage rate for the hours in a calendar week during which
porters or office cleaners are required to be regularly
employed (e.g., if, for example, as of October 1, 1997, an
agreement between RAB and Local 32B-32J shall require the
regular employment of Building porters for forty (40)
hours during a calendar
- 24 -
<PAGE>
week at a regular hourly rate of three ($3.00) dollars for
the first thirty (30) hours, and premium or overtime
hourly wage rate of four dollars and fifty cents ($4.50)
for the remaining ten (10) hours, then the regular
straight time hourly wage rate under this Article, as of
October 1, 1998, shall be deemed to be the total weekly
wage rate of one hundred thirty-five ($135.00) dollars,
divided by the total number of required hours of
employment, forty (40) or $3.375).
(5) Subject to the provisions herein contained, and at
Landlord's option, computation of the minimum regular
hourly wage rate shall be based on the number of hours
that a porter or office cleaner is expected to work in any
comparison year. In determining said number of hours,
Landlord may make reasonable estimates of the average
number of days or hours not worked by an average porter or
office cleaner, where such days or hours are not specified
by, or vary with individual circumstances pursuant to, the
union agreement.
If there is no such union agreement in effect at any time or prior to
the term of this Lease, then all computations and payments shall, nevertheless,
be made, but shall be on the basis of the regular hourly wage rates, plus any
taxes applicable thereto, actually being paid or accrued at such time by the
Landlord or by the contractor performing the cleaning services for Landlord for
such porters or office cleaners, as the case may be, or, if there are no such
persons employed at the Building, then such computation shall be based on the
wage rates (without fringe benefits) of porters or office cleaners, as the case
may be, at the Empire State Building, New York, New York. Appropriate
retroactive adjustment shall thereafter be made if and when the minimum regular
hourly wage rate pursuant to such agreement is finally determined; provided,
however, that if as of the last day of any comparative year, no union agreement
shall be in effect January 1, occurring in such comparative year, then the
minimum regularly hourly wage rate computed as aforedescribed shall for all
purposes hereof be deemed to be the minimum regular hourly wage rate of purposes
of this Article, and that no retroactive adjustment shall be made with respect
thereto.
(b) The parties acknowledge that the labor rate is intended to be an
index in the nature of a cost of living or other such index; it is not intended
to reflect the actual costs of wages or expenses for the Building.
(c) In the event that the labor rate in effect for the comparative year
2000 and any comparative year thereafter following the base year shall exceed
the Base Rate, then Tenant shall pay to Landlord, as additional rent for such
comparative year, an amount equal to the product obtained by multiplying (i) the
rentable square foot area of the demised Premises, by (ii) one (1) cent for each
cent (including any fraction of a cent) by which the labor rate in effect during
such comparative year exceeds the Base Rate. Subject to subdivision (f) hereof,
each such annual amount of additional rent shall commence to be payable, in
equal monthly installments, as of the first day of the period for which such
labor rate shall have changed; and, after Landlord shall furnish Tenant with an
escalation statement relating to such increase in the labor rate, all monthly
installments of rent shall contain an item of additional rent equal to
one-twelfth (1/12) of the annual amount determined above, until a new change
shall take place in the labor rate. In the event that the escalation statement
is furnished to the Tenant after the commencement or effective date of any
change in the labor rate, there shall be promptly paid by Tenant to Landlord the
amount theretofore accrued or allocable to the period to the furnishing of the
said escalation statement. In the event that the labor rate shall be changed or
shall change more frequently than once a year, the adjustment shall similarly be
made by Landlord in an additional escalation statement furnished by Landlord, so
as to reflect such change in the monthly installments, as of the effective date
of each such change.
- 25 -
<PAGE>
(d) The statements furnished by Landlord to Tenant, as provided above,
shall be prepared in reasonable detail by Landlord. The statements thus
furnished to Tenant shall constitute a final determination as between Landlord
and Tenant of the labor rate and Porter's Wage escalation additional rent for
the periods represented thereby, unless Tenant within ninety (90) days after
they are furnished shall in writing challenge their accuracy or their
appropriateness, which notice shall specify the particular respects in which the
statement is inaccurate or inappropriate.
If Tenant shall so dispute said statement then, pending the
resolution of such dispute, Tenant shall pay the additional rent to Landlord in
accordance with the statements furnished by Landlord.
(e) In no event shall the fixed annual rent payable under this Lease be
reduced by virtue of this Article.
(f) If the rent Commencement Date of this Lease is not the first day of
the first comparative year, then the additional rent due hereunder for such
first comparative year shall be a proportionate share of said additional rent
for the entire comparative year, said proportionate share to be based upon the
length of time that this Lease's term will be in existence during such first
comparative year. Upon the date of any expiration or termination of this Lease
(except termination because of Tenant's default), whether the same be the date
hereinabove set forth for the expiration for the term or any prior or subsequent
date, a proportionate share of said additional rent for the comparative year
during which such expiration or termination occurs shall immediately become due
and payable by Tenant to Landlord. The said proportionate share shall be based
upon the length of time that this Lease shall have been in existence during such
comparative year. Prior to or promptly after said expiration or termination,
Landlord shall compute the additional rent, if any, due from Tenant as
aforesaid, which computations shall either be based on that comparative year's
labor rate(s) or be an estimate, based upon the most recent statements
theretofore prepared by Landlord and furnished to Tenant. If an estimate is
used, then Landlord thereafter shall cause statements to be prepared on the
basis of that comparative year's actual labor rate(s) and, upon Landlord's
furnishing such statement to Tenant. Landlord and Tenant shall make appropriate
adjustments of amounts then owing or estimated payments theretofore made.
(g) Notwithstanding any cancellation or termination of the term of this
Lease prior to the Lease's expiration date (except in the case of a cancellation
by mutual agreement or Tenant's cancellation as of right) Tenant's obligation to
pay any and all additional rent under this Article shall continue and cover all
periods up to the Lease expiration date. Landlord's and Tenant's obligation to
make the adjustments referred to in subdivision (f) above shall survive any
expiration or sooner termination of the term of this Lease.
(h) Any delay or failure of Landlord in billing for any additional rent
payable as hereinabove provided shall not constitute a waiver of or in any way
impair the continuing obligation of Tenant to pay such additional rent
hereunder, provided such failure does not continue for two (2) years beyond the
expiration of the term of this Lease.
- 26 -
<PAGE>
RENT CREDIT
53. If and so long as Tenant is not in default under this Lease beyond any
grace period, Tenant shall be entitled to a rent credit in the amount of
$49,728.00, to be applied against the first (1st) and second (2nd) monthly
installments of fixed annual rent (without electricity) accruing under this
Lease after the Commencement Date (as defined in Article 55), so that Tenant
shall occupy the demised Premises free of such fixed annual rent for that
period; except that Tenant shall nevertheless be obligated from and after the
Commencement Date of the term, to pay additional rents hereunder and to make
payment of the ERIF portion of the fixed annual rent due under Article 40
hereof, (anything in said Article 40 to the contrary notwithstanding).
Anything contained hereinabove to the contrary notwithstanding, if
Tenant at any time during the term of this Lease, breaches any material
covenant, condition or provision of this Lease and fails to cure such breach
within any applicable grace period, and provided that this Lease is terminated
by Landlord because of such material default, then, in addition to all other
damages and remedies herein provided and to which Landlord may be otherwise
entitled, Landlord shall also be entitled to the repayment in full of any rent
credit theretofore enjoyed by Tenant, which repayment Tenant shall make upon
demand therefor provided , however, that the amount of such rent credit to be
repaid hereunder shall be multiplied by a fraction, the denominator of which is
one hundred twenty (120), and the numerator of which is the number of months,
including portions thereof, remaining in the originally stated term of this
Lease following such breach.
- 27 -
<PAGE>
MISCELLANEOUS
54. A. This Lease constitutes the entire agreement between the parties
hereto and no earlier statement or prior written matter shall have any force or
effect. Tenant agrees that it is not relying on any representations or
agreements other than those contained in this Lease. This agreement shall not be
modified or canceled except by written instrument subscribed by both parties.
The covenants, conditions and agreements contained in this Lease shall bind and
inure to the benefit of Landlord and Tenant and their respective heirs,
distributees, executors, administrators, successors and their permitted assigns.
B. This Rider modifies and supersedes certain provisions of the printed
portion of this Lease. In the event any term, covenant, condition or agreement
contained in this Rider to the Lease shall conflict or be inconsistent with any
term, covenant, condition or agreement contained in the printed portion of this
Lease, then the parties agree that the Rider provision shall prevail.
C. This Lease shall be construed without regard to any presumption or
other rule requiring construction against the party causing this Lease to be
drafted.
- 28 -
<PAGE>
COMMENCEMENT OF TERM
55. A. The Premises are leased for a term of approximately ten (10) years
("Term") which shall commence on a date ("Commencement Date") which shall be the
earlier of:
(i) the date upon which Landlord's Work is substantially completed,
or
(ii) the date Tenant or anyone claiming by, under or though Tenant
first shall occupy any part of the Premises for the conduct of Tenant's
business, and shall end on the last day of the calendar month in which the day
preceding the tenth (10th) anniversary of the Commencement Date occurs
("Expiration Date") unless the term shall terminate sooner pursuant to any of
the terms of this Lease or pursuant to law. Landlord shall notify Tenant (i) ten
(10) days prior to the date upon which it estimates that Landlord's Work will be
substantially completed.
B. When the Commencement Date has occurred, Tenant, upon the request of
Landlord, shall execute a statement prepared by Landlord, stating the
Commencement Date unless Tenant disputes the correctness thereof. Any failure of
Tenant to execute such statement shall not affect the Commencement Date as
determined by Landlord.
C. Except as provided in this Article, Tenant expressly waives any
right to rescind this Lease under Section 223-a of the New York Real Property
Law or under any present or future statute of similar import then in force and
further expressly waives the right to recover any damages, direct or indirect,
which may result form Landlord's failure to deliver possession of the Premises
on the Commencement Date. Tenant agrees that the provisions of this Article and
Article 16 are intended to constitute "an express provision to the contrary"
within the meaning of said Section 223-a.
- 29 -
<PAGE>
ACM
56. Notwithstanding anything to the contrary contained in this Lease, in
the event of the existence of any asbestos-containing material (collectively,
"ACM") within the Premises, Landlord shall (at its sole cost and expense)
remove, enclose, encapsulate or otherwise manage such ACM as required by
applicable law and shall use reasonable efforts to minimize interference with
Tenant's permitted use of the Premises in complying with its obligations
pursuant to said law, provided, however, that Tenant acknowledges and agrees
that all such efforts shall be performed on normal business days during normal
business hours, and provided to the extent that Tenant has not (i) disturbed
such ACM, (ii) caused such ACM to become friable by the performance of any work
or alterations in the Premises or (iii) installed same; in the event that any of
the foregoing occur, then Tenant shall remove, enclose, encapsulate or otherwise
manage such ACM as required by applicable law at its sole cost and expense.
- 30 -
<PAGE>
HAZARDOUS SUBSTANCES
57. Notwithstanding anything contained herein to the contrary, Landlord
represents and warrants to Tenant that no proceeding has been instituted and, to
the best of Landlord's knowledge, no proceeding is threatened, by any party or
governmental body in any way relating to the existence of substances in the
Premises deemed to be hazardous as a matter of law.
- 31 -
<PAGE>
INTERRUPTION OF SERVICES
58. If Landlord fails to make any repair or provide any service Landlord is
obligated to provide under this Lease and as a result thereof, Tenant shall be
not able to use and shall have discontinued its occupancy of all or any affected
portion of the Premises for a period of thirty (30) consecutive days or more
after notice thereof to Landlord then, except as provided in Article 10 hereof,
Tenant shall be entitled to an abatement of rent with respect to the Fixed
Annual Rent and Additional Rent allocable to such portion of the Premises which
is not usable and is unoccupied for each day after said thirty (30) consecutive
day period until said repair is substantially completed or services
substantially restored by Landlord provided further, however, Tenant shall not
be entitled to an abatement of rent in the event that such failure results from
(i) any installation, alteration or improvement which is not performed by Tenant
in a good workmanlike manner, (ii) Tenant's failure to perform its obligations
hereunder, or (iii) the negligence or tortious conduct of Tenant.
- 32 -
<PAGE>
FREIGHT ELEVATOR
Supplementing Article 4 of the Rules and Regulations:
59. No heavy or bulky materials including, but not limited to furniture,
office equipment, packages, or merchandise ("Freight Items") shall be received
in the Premises or Building by Tenant or removed from the Premises or Building
by Tenant except on Mondays through Fridays between the hours of 7:30 a.m. and
5:00 p.m. ("Freight Hours") and by means of the freight elevators only. In the
event that Tenant requires additional freight elevator service at hours other
than those set forth above, Tenant shall provide Landlord with at least
twenty-four (24) hours' prior notice. In such event, Tenant agrees that it shall
pay to Landlord the charge prescribed for such additional freight service and
further agrees that, in the event that additional freight service is requested
for a weekend, the minimum charge prescribed by Landlord shall be for four (4)
hours. Any damage done to the Building or Premises by Tenant, its employees,
agents, servants, representatives and/or contractors in the course of moving any
Freight Items shall be paid by Tenant upon demand by Landlord. Notwithstanding
anything to the contrary contained in this Lease and the Rules and Regulations,
at the time Tenant commences or vacates occupancy of the Premises, all Freight
Items and other personal property of Tenant shall be delivered to or removed
from the Building or Premises upon not les than twenty-four (24) hours' prior
notice to Landlord and at times prescribed by Landlord.
Tenant shall not be charged for its use of freight service during its
move into the Premises in connection with its initial occupancy thereof,
provided that such use is during normal Freight Hours an provided that Tenant
acknowledges and agrees that such use shall be on a non-exclusive, first-come,
first-served basis.
- 33 -
<PAGE>
LETTER OF CREDIT
60. A. At any time during the term of this Lease, Tenant shall have the
option to deposit with Landlord in substitution for or in lieu of the cash
security deposit, deposited with Landlord pursuant to Article 32 hereof
simultaneously with the execution of this Lease by Tenant, an unconditional,
irrevocable, negotiable, commercial letter of credit in a sum equal to one
hundred twenty thousand eight hundred eighty-five dollars and twenty cents
($120,885.20) (any such letter of credit deposited hereunder hereinafter called
the "Credit"), to be held and used under the security deposit provisions of the
Lease. Any such Credit shall be issued by a bank which is a member of the New
York Cleaning House Association, naming Landlord (or its successor as Landlord)
as beneficiary and authorizing the beneficiary to draw on the bank in said
amount, or any portion thereof, available by the sight draft of the beneficiary
(which may be executed on behalf of the beneficiary by its agent), without
presentation of any other documents, statements or authorizations. The Credit
shall have a term of at least twelve (12) months, and it shall by its terms be
renewed, automatically, each year, by the bank, the last renewal of which shall
be for a term set to expire not earlier than the date occurring ninety (90) days
following the expiration of the term of this Lease, unless the bank gives
written notice to the beneficiary, at least forty-five (45) days prior to the
expiration date of the then existing Credit, that the bank elects that it not so
be renewed. The Credit shall be transferable. All transfer fees shall be payable
by Tenant. The bank shall further agree with drawers, endorsers, and all bona
fide holders that drafts drawn under and in compliance with the terms of the
Credit will be duly honored upon presentation to the bank at its main office
located in New York, New York. The Credit shall be subject to the Uniform
Customs and Practice for Documentary Credits (1993 Revision) International
Chamber of Commerce Publication No. 500.
B. If during the term of this Lease, the Credit and/or the proceeds of
all or part of said Credit become less than the full amount of the security
hereinabove required, then and in such event Tenant shall, upon demand, deposit
with Landlord the amount of any security/Credit theretofore used or applied by
Landlord pursuant to the terms hereof in order that Landlord shall have the full
security on hand at all times during the term of this Lease. If at the
expiration of the term of this Lease, Landlord holds all or part of said Credit,
and Tenant is not in default under any of the terms, covenants and conditions of
this Lease, then Landlord will turn over said Credit to Tenant or assign it to
the designee of Tenant.
C. It shall be the obligation of Tenant during the term of this Lease
to deliver to Landlord at lest thirty (30) days prior to the expiration date of
the then existing Credit, a renewal or extension of said Credit or a substitute
Credit (each fully complying with the foregoing). If for any reason Landlord has
not received such renewal or extension or substitute Credit within twenty (20)
days prior to the expiration date of the then existing Credit, then and in such
event Landlord shall be free to draw on the Credit and hold and use and apply
the proceeds thereof in accordance with the security deposit provisions of this
Lease. Tenant agrees to reimburse Landlord for any reasonable attorneys' fees
incurred by Landlord in connection with reviewing the Credit and renewals,
extensions or substitutions therefor, ensuring that the provisions of the Credit
and any renewals, extensions or substitutions therefor comply with the
provisions of this Article, drawing down upon the proceeds of Credit, or any
renewals, extensions or substitution therefor, or ensuring that the
security/Credit is maintained as required under this Lease.
D. Landlord and Tenant acknowledge and agree that Tenant may reduce
either the amount of the cash security deposit or the Credit, as the case may
be, by the sum of thirty-nine thousand eight hundred ninety-two dollars and
thirteen cents ($39,892.13) on the fifth (5th) anniversary of the Commencement
Date, so that the amount of the cash security deposit or the Credit held by
Landlord from the fifth (5th) anniversary of the Commencement Date through the
expiration of the term of this Lease shall be eighty thousand nine hundred
ninety-three dollars and seven cents ($80,993.07) provided that (x) at the time
of notice or the effective date of said reductions in the cash security deposit
or the Credit, Tenant shall not then or at any time during the term of this
Lease been in default in any of its obligations under this Lease beyond the
expiration of any notice and cure period, (y) Tenant gives Landlord thirty
- 34 -
<PAGE>
(30) days' written notice of its intent to so reduce the cash security deposit
or the Credit (z) provides Landlord with an amendment to said Credit issued by
the bank which issued the Credit at the time of the foregoing reduction.
- 35 -
<PAGE>
CLEANING SPECIFICATIONS
A) GENERAL CLEANING - NIGHTLY
- Dust sweep all stone, ceramic tile, marble terrazzo, asphalt tile,
linoleum, rubber, vinyl and other types of flooring
- Carpet sweep all carpets and rugs four (4) times per week
- Vacuum clean all carpets and rugs, once (1) per week
- Police all private stairways and keep in clean condition
- Empty and clean all wastepaper baskets, ash trays and receptacles; damp
dust as necessary
- Clean all cigarette urns and replace sand or water as necessary
- Remove all normal wastepaper and tenant rubbish to a designated area in
the Premises. (Excluding cafeteria waste, bulk materials, and all
special materials such as old desks, furniture, etc.)
- Dust all furniture and window sills as necessary
- Dust clean all glass furniture tops
- Dust all chair rails, trim and similar objects as necessary
- Dust all baseboards as necessary
- Wash clean all water fountains
- Keep locker and service closets in clean and orderly condition
B) LAVATORIES - NIGHTLY (EXCLUDING PRIVATE & EXECUTIVE LAVATORIES)
- Sweep and mop all flooring
- Wipe clean all mirrors, powder shelves and bright work, including
flushometers, piping and toilet seat hinges
- Wash and disinfect all basins, bowls and urinals
- Wash both sides of all toilet seats
- Dust all partitions, tile walls, dispensers and receptacles
- Empty and clean paper towel and sanitary disposal receptacles
- Fill toilet tissue holders, soap dispensers and towel dispensers;
materials to be furnished by Landlord
- Remove all wastepaper and refuse to designated area in the Premises
- 36 -
<PAGE>
C) LAVATORIES - PERIOD CLEANING (EXCLUDES PRIVATE & EXECUTIVE LAVATORIES)
- Machine scrub flooring as necessary
- Wash all partitions, tile walls, and enamel surfaces periodically,
using proper disinfectant when necessary
D) DAY SERVICES - DUTIES OF THE DAY PORTERS
- Police ladies' restrooms and lavatories, keeping them in clean
condition
- Fill toilet dispensers; materials to be furnished by Landlord
- Fill sanitary napkin dispensers; materials to be furnished by Landlord
E) SCHEDULE OF CLEANING
- Upon completion of the nightly chores, all lights shall be turned off,
windows closed, doors locked and offices left in a neat and orderly
condition
- All day, nightly and periodic cleaning services as listed herein, to be
done five nights each week, Monday through Friday, except Union and
Legal Holidays
- All windows from the second (2nd) floor to the roof will be cleaned
inside out quarterly, weather permitting
- 37 -