<PAGE> 1
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON JUNE 30 1999
REGISTRATION NO. 333-74403
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
------------------------
AMENDMENT NO. 5
TO
FORM S-1
INTERLIANT, INC.
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
<TABLE>
<S> <C> <C>
DELAWARE 7379 13-397-8980
(STATE OR OTHER JURISDICTION (PRIMARY STANDARD INDUSTRIAL (I.R.S. EMPLOYER
OF INCORPORATION OR ORGANIZATION) CLASSIFICATION CODE NUMBER) IDENTIFICATION NO.)
</TABLE>
2 MANHATTANVILLE ROAD
PURCHASE, NEW YORK 10577
(914) 649-9000
(ADDRESS, INCLUDING ZIP CODE AND TELEPHONE NUMBER,
INCLUDING AREA CODE, OF REGISTRANT'S PRINCIPAL EXECUTIVE OFFICES)
------------------------
BRADLEY A. FELD
CO-CHAIRMAN OF THE BOARD
INTERLIANT, INC.
2 MANHATTANVILLE ROAD
PURCHASE, NEW YORK 10577
(914) 649-9000
(NAME, ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER,
INCLUDING AREA CODE, OF AGENT FOR SERVICE)
------------------------
COPIES TO:
<TABLE>
<S> <C>
E. ANN GILL, ESQ. STEVEN BERSON, ESQ.
JONATHAN L. FREEDMAN, ESQ. WILSON SONSINI GOODRICH & ROSATI,
DEWEY BALLANTINE LLP PROFESSIONAL CORPORATION
1301 AVENUE OF THE AMERICAS 650 PAGE MILL ROAD
NEW YORK, NEW YORK 10019 PALO ALTO, CALIFORNIA 94304-1050
(212) 259-8000 (650) 493-9300
</TABLE>
------------------------
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: As soon as
practicable after this Registration Statement becomes effective.
If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, check the following box: [ ]
If this Form is filed to register additional securities for an Offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same Offering. [ ] ________
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same Offering. [ ] ________
If this Form is a post-effective amendment filed pursuant to Rule 462(d)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same Offering. [ ] ________
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [ ]
------------------------
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------
PROPOSED PROPOSED
MAXIMUM MAXIMUM AMOUNT OF
TITLE OF EACH CLASS OF AMOUNT TO BE OFFERING PRICE AGGREGATE REGISTRATION
SECURITIES TO BE REGISTERED REGISTERED(1) PER SHARE(2) OFFERING PRICE(2) FEE(3)
- ------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock
($.01 par value)............ 8,050,000 $11.00 $88,550,000 $24,617
- ------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) Includes 1,050,000 shares that the Underwriters have the option to purchase
to cover any over-allotments.
(2) Estimated solely for the purpose of calculating the registration fee.
(3) Previously paid.
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL
FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(a) OF
THE SECURITIES ACT OF 1933 OR UNTIL THIS REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(a),
MAY DETERMINE.
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<PAGE> 2
EXPLANATORY NOTE
THIS REGISTRATION STATEMENT CONTAINS TWO SEPARATE PROSPECTUSES. THE FIRST
PROSPECTUS RELATES TO A PUBLIC OFFERING OF SHARES OF COMMON STOCK OF INTERLIANT,
INC. IN THE UNITED STATES AND CANADA (THE "U.S. OFFERING"). THE SECOND
PROSPECTUS RELATES TO A CONCURRENT OFFERING OF COMMON STOCK OUTSIDE THE UNITED
STATES AND CANADA (THE "INTERNATIONAL OFFERING"). THE PROSPECTUSES FOR THE U.S.
OFFERING AND THE INTERNATIONAL OFFERING WILL BE IDENTICAL IN ALL RESPECTS, OTHER
THAN THE FRONT COVER PAGE, THE "UNDERWRITING" SECTION AND THE BACK COVER PAGE
RELATING TO THE INTERNATIONAL OFFERING. SUCH ALTERNATE PAGES APPEAR IN THIS
REGISTRATION STATEMENT IMMEDIATELY FOLLOWING THE COMPLETE PROSPECTUS FOR THE
U.S. OFFERING.
<PAGE> 3
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 13. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION
The following is an itemized statement of the estimated amounts of all
expenses payable by the Registrant in connection with the registration of the
common stock offered hereby, other than underwriting discounts and commissions:
<TABLE>
<S> <C>
Registration Fee -- Securities and Exchange Commission...... $ 21,375
NASD Filing Fee............................................. 9,125
Blue Sky fees and expenses.................................. 1,000
Accountants' fees and expenses.............................. 300,000
Legal fees and expenses..................................... 550,000
Printing and engraving expenses............................. 500,000
Transfer agent and registrar fees........................... 5,000
Miscellaneous............................................... 13,500
----------
Total............................................. $1,400,000
==========
</TABLE>
ITEM 14. INDEMNIFICATION OF DIRECTORS AND OFFICERS
Section 145(a) of the General Corporation Law of the State of Delaware (the
"DGCL") provides that a Delaware corporation may indemnify any person who was or
is a party or is threatened to be made a party to any threatened, pending or
completed action, suit or proceeding, whether civil, criminal, administrative or
investigative (other than an action by or in the right of the corporation) by
reason of the fact that he is or was a director, officer, employee or agent of
the corporation or is or was serving at the request of the corporation as a
director, officer, employee or agent of another corporation, partnership, joint
venture, trust or other enterprise, against expenses, judgments, fines and
amounts paid in settlement actually and reasonably incurred by him in connection
with such action, suit or proceeding if he acted in good faith and in a manner
he reasonably believed to be in or not opposed to the best interests of the
corporation, and, with respect to any criminal action or proceeding, had no
cause to believe his conduct was unlawful.
Section 145(b) of the DGCL provides that a Delaware corporation may
indemnify any person who was or is a party or is threatened to be made a party
to any threatened, pending or completed action or suit by or in the right of the
corporation to procure a judgment in its favor by reason of the fact that such
person acted in any of the capacities set forth above, against expenses actually
and reasonably incurred by him in connection with the defense or settlement of
such action or suit if he acted under similar standards, except that no
indemnification may be made in respect of any claim, issue or matter as to which
such person shall have been adjudged to be liable to the corporation unless and
only to the extent that the court in which such action or suit was brought shall
determine that despite the adjudication of liability, such person is fairly and
reasonably entitled to be indemnified for such expenses which the court shall
deem proper.
Section 145 of the DGCL further provides that to the extent a director or
officer of a corporation has been successful in the defense of any action, suit
or proceeding referred to in subsections (a) and (b) or in the defense of any
claim, issue, or matter therein, he shall be indemnified against any expenses
actually and reasonably incurred by him in connection therewith; that
indemnification provided for by Section 145 shall not be deemed exclusive of any
other rights to which the indemnified party may be entitled; and that the
corporation may purchase and maintain insurance on behalf of a director,
officer, employee or agent of the corporation against any liability asserted
against him or incurred by him in any such capacity or arising out of his status
as such whether or not the corporation would have the power to indemnify him
against such liabilities under Section 145.
II-1
<PAGE> 4
Section 102(b)(7) of the DGCL provides that a corporation in its original
certificate of incorporation or an amendment thereto validly approved by
stockholders may eliminate or limit personal liability of members of its board
of directors or governing body for breach of a director's fiduciary duty.
However, no such provision may eliminate or limit the liability of a director
for breaching his duty of loyalty, failing to act on good faith, engaging in
intentional misconduct or knowingly violating a law, paying a dividend or
approving a stock repurchase which was illegal or obtaining an improper personal
benefit. A provision of this type has no effect on the availability of equitable
remedies, such as injunction or rescission, for breach of fiduciary duty.
Interliant's Restated Certificate of Incorporation contains such a provision.
Interliant's Certificate of Incorporation and By-Laws provide that
Interliant shall indemnify officers and directors and, to the extent permitted
by the Board of Directors, employees and agents of Interliant, to the full
extent permitted by and in the manner permissible under the laws of the State of
Delaware. In addition, the By-Laws permit the Board of Directors to authorize
Interliant to purchase and maintain insurance against any liability asserted
against any director, officer, employee or agent of Interliant arising out of
his capacity as such.
ITEM 15. RECENT SALES OF UNREGISTERED SECURITIES
In the three years preceding the filing of this Registration Statement,
Interliant has issued securities that were not registered under the Securities
Act of 1933, as amended (the "Securities Act") to a limited number of persons,
as described below.
Interliant believes that the transactions described below were exempt from
registration under the Securities Act pursuant to Section 4(2) of the Securities
Act, or Regulation D promulgated thereunder, as transactions by an issuer not
involving public offering, or pursuant to Rule 701 promulgated under Section
3(b) of the Securities Act, as transactions pursuant to compensatory benefit
plans and contracts relating to compensation. The recipients of securities in
each such transaction represented that they were acquiring the securities for
investment only and not with a view to or for sale in connection with any
distribution thereof and appropriate legends were affixed to the share
certificates issued in such transactions. All recipients had adequate access,
through their relationships with Interliant, to information about Interliant, or
were given an adequate opportunity to review information about Interliant.
The following figures give effect to a three-for-one stock split of the
Common Stock of Interliant in July 1998.
(A) ISSUANCE OF CAPITAL STOCK.
Pursuant to a Stock Subscription Agreement dated December 8, 1997 between
Interliant and Web Hosting Organization LLC ("WEB"), Interliant issued to WEB,
for a purchase price of $5,000,000, 3,000,000 shares of common stock of
Interliant, $.01 par value and also granted WEB an option to purchase up to an
additional 6,600,000 shares of common stock at an exercise price of $1.67 per
share (the "Option").
On April 7, 1998, in connection with the acquisition of substantially all
of the assets of Clever Computers, Inc., ("Clever"), and as consideration for
entering into an employment agreement with Interliant, Interliant issued 150,000
shares of common stock to the former president and founder of Clever, Steven C.
Dabbs.
On July 10, 1998, Interliant issued 9,000 shares of common stock to Jab
Web, Inc. (formerly Tri-Star Web Creations, Inc.), as part of the purchase price
for substantially all of the assets of Tri-Star Web Creations, Inc.
On July 10, 1998, Interliant issued to WEB, for a purchase price of
$11,000,000, 6,600,000 shares of common stock.
On July 10, 1998, Interliant issued 115,707 shares of common stock to All
Information Systems, Inc., as part of the purchase price for substantially all
of the assets of All Information Systems, Inc.
II-2
<PAGE> 5
On July 10, 1998, Interliant issued 12,000 shares of common stock to
Software Business Technologies, Inc., as part of the purchase price for
substantially all of the Web hosting assets of Software Business Technologies,
Inc.
On July 30, 1998, Interliant issued 5,490 shares of common stock to
BestWare, Inc. (dba "Maikon"), as part of the purchase price for substantially
all of the assets of BestWare, Inc. (dba "Maikon").
On August 31, 1998, in connection with the acquisition of B.N. Technology,
Inc., and as consideration for entering into employment agreements with
Interliant, Interliant issued 240,000 shares of common stock to Mr. Bernd
Neumann and Andrea Neumann, his wife, and 60,000 shares of common stock to Mr.
Thomas Gorny.
On September 16, 1998, in connection with the acquisition of GEN
International Inc., and as consideration for entering into a consulting
agreement with Interliant, Interliant issued 25,000 shares of common stock to
Mr. Thomas Heimann and Patricia Karasy, his wife.
On September 18, 1998, Interliant issued to WEB, for a purchase price of
$7,500,000, 4,500,000 shares of common stock.
On December 4, 1998, Interliant issued to WEB, for a purchase price of
$7,500,000, 4,500,000 shares of common stock.
On January 28, 1999, Interliant issued 2,647,658 shares of Series A
Redeemable Convertible Preferred Stock, convertible into an equal amount of
shares of common stock, and warrants to purchase 749,625 shares of common stock
to SOFTBANK Technology Ventures IV L.P. and one of its affiliates, SOFTBANK
Technology Advisors Fund for a purchase price of $13,000,000.
On February 4, 1999, Interliant issued 450,000 shares of common stock to
Digiweb, Inc. as part of the purchase price for substantially all of the assets
of Digiweb, Inc.
On February 4, 1999, in connection with the acquisition of substantially
all of the assets of Telephonetics International, Inc., Interliant issued
140,000 shares of common stock to Telephonetics, International, Inc..
On February 4, 1999, Interliant issued to WEB, for a purchase price of
$11,000,000, 6,600,000 shares of common stock.
On February 17, 1999, in connection with the acquisition of Net Daemons
Associates, Inc., Interliant issued 425,000 shares of common stock to certain
stockholders of Net Daemons Associates, Inc.
On March 10, 1999, in connection with the acquisition of substantially all
of the assets of Interliant Texas Interliant issued 2,748,555 shares of common
stock to Mathew Wolf, 398,845 shares of common stock to the Ann Weltchek Wolf
1995 Marital Trust, 797,690 shares of common stock to the Mathew D. Wolf
Children's Trust, 31,908 shares of common stock to Michael August and 114,644
shares of common stock to Broadview Holdings LLP.
On April 19, 1999, SOFTBANK exercised its warrants to purchase 749,625
shares of the common stock of Interliant for an aggregate exercise price of
$5,000,000.
On May 4, 1999, in connection with the acquisition of Advanced Web
Creations, Inc. Interliant issued 52,500 to Advanced Web Creations, Inc., 2,250
shares of common stock to Santa Fe Capital Group of New Mexico, Inc., 53,417
shares of common stock to Gary Rudd, 53,416 shares of common stock to Stephen
Rudd, 53,417 shares of common stock to Mark Lichtenstein and 10,000 shares of
common stock to Kevin Paul.
On May 19, 1999, as consideration for entering into a licensing
arrangement, Interliant issued 6,000 shares of common stock to Greg Stipe.
As of the date of the filing of this Registration Statement, options to
purchase 581,894 shares of common stock have been exercised at a weighted
average exercise price of $0.17 per share.
II-3
<PAGE> 6
(B) GRANTS OF STOCK OPTIONS.
The Interliant, Inc. 1998 Stock Option Plan was adopted by Interliant's
Board of Directors on February 1, 1998. As of the date hereof, options to
purchase up to an aggregate 3,713,994 shares of common stock at prices ranging
from $0.13 to $10.00 per share, had been granted to employees of Interliant, of
which options to purchase up to an aggregate of 3,092,700 shares of common
stock, at a weighted average exercise price of $2.83 per share, were outstanding
as of such date.
ITEM 16. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
(a) Exhibits
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
- ------- -----------
<C> <C> <S>
1.1 -- Form of U.S. Purchase Agreement.*
1.2 -- Form of International Purchase Agreement.*
2.1 -- Asset Purchase Agreement among Sage Networks Acquisition
Corp., Sage Networks, Inc., Interliant, Inc. and the
shareholders of Interliant, Inc., dated March 8, 1999.*
2.2 -- Agreement to Deliver Shares between Interliant, Inc., Sage
Networks Acquisition Corp. and Sage Networks, Inc., dated as
of March 10, 1999.*
2.3 -- Agreement and Plan of Merger by and among Net Daemons, Inc.,
the Shareholders Party hereto and Sage Networks, Inc. and
Sage NDA Acquisition Corp., dated as of February 17, 1999.*
2.4 -- Asset Purchase Agreement between Digiweb, Inc., a Delaware
corporation, Yi Wen Chung, Diane X. Chen and Digiweb, Inc.,
a Maryland corporation, dated February 4, 1999.*
2.5 -- Asset Purchase Agreement between Telephonetics
International, Inc., Alan Kvares and Telephonetics, Inc.,
dated February 4, 1999.*
2.6 -- Asset Purchase Agreement between Sage Networks Acquisition
Corp., Thomas Heimann and GEN International Inc., dated
September 16, 1998.*
2.7 -- Asset Purchase Agreement between Global Entrepreneurs
Network, Inc. and Sage Networks Acquisition Corp., dated as
of September 16, 1998.*
2.8 -- Stock Purchase Agreement among B.N. Technology, Inc., Bernd
Neumann, Annedore Sommer, and Sage Networks, Inc., dated
August 31, 1998.*
2.9 -- Asset Purchase Agreement between Sage Networks, Inc. and
HomeCom Communications, Inc. dated June 10, 1998.*
2.10 -- Asset Purchase Agreement between Sage Networks Acquisition
Corp., Bonnie Shimel, William Nicholson and James Kucharski,
Alan Shimel and Tri-Star Web Creations, Inc., dated May 1,
1998.*
2.11 -- Asset Purchase Agreement between Sage Networks Acquisition
Corp., Steven C. Dabbs and Clever Computers, Inc., dated
April 7, 1998.*
3.1 -- Form of Amended and Restated Certificate of Incorporation of
the Registrant.*
3.2 -- Form of Amended and Restated By-Laws of the Registrant.*
4.1 -- Specimen Certificate for common stock of the Registrant.*
4.2 -- Investors Agreement, dated as of January 28, 1999, by and
among Sage Networks, Inc., SOFTBANK Technology Ventures IV,
L.P. and SOFTBANK Technology Advisors Funds, L.P.*
4.3 -- Securities Purchase Agreement between Sage Networks, Inc.
and SOFTBANK Technology Ventures IV, L.P. and SOFTBANK
Technology Advisors Funds, L.P. dated January 28, 1999.*
4.4 -- Registration Rights Agreement, dated as of December 8, 1997,
by and between Sage Networks, Inc. and Web Hosting
Organization LLC.*
4.5 -- Shareholders Agreement by and among Sage Networks, Inc. and
each of the Stockholders of Sage Networks, Inc., dated as of
March 10, 1999.*
</TABLE>
II-4
<PAGE> 7
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
- ------- -----------
<C> <C> <S>
4.6 -- Letter Agreement, dated November 26, 1997, between Leonard
J. Fassler, Bradley A. Feld, Chef Nominees Limited and
Charterhouse Equity Partners III L.P. (Agreement has now
been terminated.)*
5.1 -- Opinion of Dewey Ballantine LLP.*
10.1 -- Professional Services Agreement by and between Sage
Networks, Inc. and Portal Software, Inc., dated as of July
31, 1998.*
10.2 -- Software License and Support Agreement by and between Sage
Networks, Inc. and Portal Software, Inc., dated as of July
31, 1998.*
10.3 -- The Vantive Corporation Software License and Support
Agreement by and between Interliant Networks, Inc. and The
Vantive Corporation, dated as of September 29, 1998.*
10.4 -- Addendum to The Vantive Corporation Software License and
Support Agreement by and between Sage Networks, Inc. and The
Vantive Corporation, dated as of September 29, 1998.*
10.5 -- Master Discounted Internet Services Agreement by and between
UUNET Technologies, Inc. and Sage Networks, Inc., dated
February 17, 1999.*
10.6 -- Joint Development Agreement between Lotus Development
Corporation and Interliant, Inc., dated as of April 27,
1998.*
10.7 -- Sage Networks, Inc. 1998 Stock Option Plan.*
10.8 -- Form of ISO Award Agreement.*
10.9 -- Form of Incentive Stock Option Award Agreement between Sage
Networks, Inc. and the individual Optionee.*
10.10 -- Form of Nonqualified Stock Option Award Agreement between
Sage Networks, Inc. and the individual Optionee.*
10.11 -- Employment Agreement by and between Sage Networks, Inc., and
Leonard J. Fassler, dated January 1, 1999.*
10.12 -- Consulting Agreement by and between Sage Networks, Inc., and
Intensity Ventures, Inc., dated January 1, 1999.*
10.13 -- Employment Agreement by and between Sage Networks, Inc., and
Stephen W. Maggs, dated January 1, 1999.*
10.14 -- Employment Agreement by and between Sage Networks, Inc., and
Rajat Bhargava, dated January 1, 1999.*
10.15 -- Employment Agreement between Sage Networks, Inc. and James
M. Lidestri, dated March 3, 1999.*
10.16 -- Deed of Lease by and between Westwood Center, LLC and Sage
Networks, Inc., dated February 11, 1999.*
10.17 -- Sublease Agreement by and between Southern Company Services,
Inc. and Sage Networks, Inc., dated May 29, 1998.*
10.18 -- First Amendment to Sublease Agreement by and between
Southern Company Services, Inc. and Sage Networks, Inc.,
dated December 15, 1998.*
10.19 -- Sublease Agreement by and between Leuko Site, Inc. and Sage
Networks, Inc., dated November 17, 1998.*
10.20 -- Agreement for Terminal Facilities Collocation Space by and
between Comstor Corporation and Sage Networks, Inc., dated
as of July 2, 1998.*
10.21 -- Standard Lease Agreement, dated June 11, 1995, between
LaSalle Partners Management Limited (as agent for Fannin
Street Limited Partnership) and Wolf Communications
Company.*
10.22 -- First Amendment to Standard Lease, dated January 18, 1996,
between LaSalle Partners Management Limited (as agent for
Fannin Street Limited Partnership) and Wolf Communications
Company.*
10.23 -- Second Amendment to Standard Lease, dated August 8, 1996,
between LaSalle Partners Management Limited (as agent for
Fannin Street Limited Partnership) and Wolf Communications
Company.*
</TABLE>
II-5
<PAGE> 8
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
- ------- -----------
<C> <C> <S>
10.24 -- First Amendment to Lease Agreement, between Westwood Center,
L.L.C. and Interliant, Inc., dated June 28, 1999.
10.25 -- Master Lease Agreement between Leasing Technologies
International, Inc. and Interliant, Inc., dated June 9,
1999.
10.26 -- Agreement of Lease between Purchase Corporate Park
Associates and Courtaulds United States Inc., dated August
23, 1991.
10.27 -- Sublease, by and between Akzo Nobel Courtalds United States,
Inc. and Interliant, Inc., dated as of May 11, 1999.
10.28 -- Agreement of Lease, between Purchase Corporate Park
Associates, L.P. and Interliant, Inc., dated as of June 16,
1999 (Interliant I).
10.29 -- Agreement of Lease, between Purchase Corporate Park
Associates, L.P. and Interliant, Inc., dated as of June 16,
1999 (Interliant II).
10.30 -- Agreement of Lease, between Purchase Corporate Park
Associates, L.P. and Interliant, Inc., dated as of June 16,
1999 (Interliant III).
21.1 -- List of Subsidiaries.*
23.1 -- Consent of Ernst & Young LLP with respect to the financial
statements of Interliant, Inc. (formerly known as Sage
Networks, Inc.).*
23.2 -- Consent of Ernst & Young LLP with respect to the financial
statements of Interliant, Inc. (which is not the registrant
and which is referred to in this prospectus as Interliant
Texas)*
23.3 -- Consent of Urbach Kahn & Werlin PC.*
23.4 -- Consent of BSC&E.*
23.5 -- Consent of PricewaterhouseCoopers LLP.*
23.6 -- Consent of Frankel, Lodgen, Locher, Golditch, Sardi &
Howard.*
23.7 -- Consent of BDO Seidman, LLP.*
23.8 -- Consent of Deloitte & Touche LLP.*
23.9 -- Consent of Dewey Ballantine LLP (contained in Exhibit 5.1).*
24.1 -- Power of Attorney (included on page II-5).*
27.1 -- Financial Data Schedule.*
99.1 -- Consent of Director Nominee.*
</TABLE>
- ---------------
* Previously filed.
(b) Consolidated Financial Statement Schedules
All schedules have been omitted because they are not required or because
the required information is given in the Consolidated Financial Statements or
Notes thereto.
ITEM 17. UNDERTAKINGS
The undersigned Registrant hereby undertakes to provide to the
underwriters, at the closing specified in the underwriting agreement,
certificates in such denominations and registered in such names as required by
the underwriters to permit prompt delivery to each purchaser.
Insofar as indemnification for liabilities arising under the Securities Act
of 1933 may be permitted to directors, officers and controlling persons of the
Registrant pursuant to the foregoing provisions, or otherwise, the Registrant
has been advised that in the opinion of the Securities and Exchange Commission
such indemnification is against public policy as expressed in the Act and is,
therefore, unenforceable. In the event that a claim for indemnification against
such liabilities (other than the payment by the Registrant in the successful
defense of any action, suit or proceeding) is asserted by such director, officer
or controlling person in connection with the securities being registered, the
Registrant will, unless in the opinion of its counsel the matter has been
settled by controlling precedent, submit to a court of appropriate jurisdiction
the question whether such indemnification by it is against public policy as
expressed in the Act and will be governed by the final adjudication of such
issue.
II-6
<PAGE> 9
The undersigned Registrant hereby undertakes that:
(1) For purposes of determining any liability under the Securities Act
of 1933, the information omitted from the form of prospectus filed as part
of this registration statement in reliance upon Rule 430A and contained in
a form of prospectus filed by the Registrant pursuant to Rule 424(b)(1) or
(4) or 497(h) under the Securities Act shall be deemed to be part of this
registration statement as of the time it was declared effective.
(2) For the purpose of determining any liability under the Securities
Act of 1933, each post-effective amendment that contains a form of
prospectus shall be deemed to be a new registration statement relating to
the securities offered therein, and this offering of such securities at the
time shall be deemed to be the initial bona fide offering thereof.
II-7
<PAGE> 10
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
has duly caused this Amendment to the Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of New York,
State of New York, on June 30, 1999.
INTERLIANT, INC.
By: /s/ LEONARD J. FASSLER
------------------------------------
Leonard J. Fassler
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed by the following persons on June 30,
1999 in the capacities indicated:
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
--------- ----- ----
<C> <S> <C>
/s/ LEONARD J. FASSLER Co-Chairman of the Board June 30, 1999
- ------------------------------------
Leonard J. Fassler
/s/ BRADLEY A. FELD* Co-Chairman of the Board June 30, 1999
- ------------------------------------
Bradley A. Feld
/s/ STEPHEN W. MAGGS* Vice Chairman, Treasurer and June 30, 1999
- ------------------------------------ Director
Stephen W. Maggs
/s/ WILLIAM A. WILSON* Chief Financial Officer (Chief June 30, 1999
- ------------------------------------ Financial and Accounting Officer)
William A. Wilson
/s/ MERRIL M. HALPERN* Director June 30, 1999
- ------------------------------------
Merril M. Halpern
/s/ THOMAS C. DIRCKS* Director June 30, 1999
- ------------------------------------
Thomas C. Dircks
/s/ PATRICIA A. M. RILEY* Director June 30, 1999
- ------------------------------------
Patricia A. M. Riley
/s/ JAY M. GATES* Director June 30, 1999
- ------------------------------------
Jay M. Gates
/s/ CHARLES R. LAX* Director June 30, 1999
- ------------------------------------
Charles R. Lax
</TABLE>
*By: /s/ LEONARD J. FASSLER
---------------------------------------------------------
Leonard J. Fassler
(Attorney in fact)
II-8
<PAGE> 11
EXHIBIT INDEX
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION PAGE
- ------- ----------- ----
<C> <C> <S> <C>
1.1 -- Form of U.S. Purchase Agreement.*
1.2 -- Form of International Purchase Agreement.*
2.1 -- Asset Purchase Agreement among Sage Networks Acquisition
Corp., Sage Networks, Inc., Interliant, Inc. and the
shareholders of Interliant, Inc., dated March 8, 1999.*
2.2 -- Agreement to Deliver Shares between Interliant, Inc., Sage
Networks Acquisition Corp. and Sage Networks, Inc., dated as
of March 10, 1999.*
2.3 -- Agreement and Plan of Merger by and among Net Daemons, Inc.,
the Shareholders Party hereto and Sage Networks, Inc. and
Sage NDA Acquisition Corp., dated as of February 17, 1999.*
2.4 -- Asset Purchase Agreement between Digiweb, Inc., a Delaware
corporation, Yi Wen Chung, Diane X. Chen and Digiweb, Inc.,
a Maryland corporation, dated February 4, 1999.*
2.5 -- Asset Purchase Agreement between Telephonetics
International, Inc., Alan Kvares and Telephonetics, Inc.,
dated February 4, 1999.*
2.6 -- Asset Purchase Agreement between Sage Networks Acquisition
Corp., Thomas Heimann and GEN International Inc., dated
September 16, 1998.*
2.7 -- Asset Purchase Agreement between Global Entrepreneurs
Network, Inc. and Sage Networks Acquisition Corp., dated as
of September 16, 1998.*
2.8 -- Stock Purchase Agreement among B.N. Technology, Inc., Bernd
Neumann, Annedore Sommer, and Sage Networks, Inc., dated
August 31, 1998.*
2.9 -- Asset Purchase Agreement between Sage Networks, Inc. and
HomeCom Communications, Inc. dated June 10, 1998.*
2.10 -- Asset Purchase Agreement between Sage Networks Acquisition
Corp., Bonnie Shimel, William Nicholson and James Kucharski,
Alan Shimel and Tri-Star Web Creations, Inc., dated May 1,
1998.*
2.11 -- Asset Purchase Agreement between Sage Networks Acquisition
Corp., Steven C. Dabbs and Clever Computers, Inc., dated
April 7, 1998.*
3.1 -- Form of Amended and Restated Certificate of Incorporation of
the Registrant.*
3.2 -- Form of Amended and Restated By-Laws of the Registrant.*
4.1 -- Specimen Certificate for common stock of the Registrant.*
4.2 -- Investors Agreement, dated as of January 28, 1999, by and
among Sage Networks, Inc., SOFTBANK Technology Ventures IV,
L.P. and SOFTBANK Technology Advisors Funds, L.P.*
4.3 -- Securities Purchase Agreement between Sage Networks, Inc.
and SOFTBANK Technology Ventures IV, L.P. and SOFTBANK
Technology Advisors Funds, L.P. dated January 28, 1999.*
4.4 -- Registration Rights Agreement, dated as of December 8, 1997,
by and between Sage Networks, Inc. and Web Hosting
Organization LLC.*
4.5 -- Shareholders Agreement by and among Sage Networks, Inc. and
each of the Stockholders of Sage Networks, Inc., dated as of
March 10, 1999.*
4.6 -- Letter Agreement, dated November 26, 1997, between Leonard
J. Fassler, Bradley A. Feld, Chef Nominees Limited and
Charterhouse Equity Partners III L.P. (Agreement has now
been terminated.)*
5.1 -- Opinion of Dewey Ballantine LLP.*
10.1 -- Professional Services Agreement by and between Sage
Networks, Inc. and Portal Software, Inc., dated as of July
31, 1998.*
10.2 -- Software License and Support Agreement by and between Sage
Networks, Inc. and Portal Software, Inc., dated as of July
31, 1998.*
</TABLE>
<PAGE> 12
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION PAGE
- ------- ----------- ----
<C> <C> <S> <C>
10.3 -- The Vantive Corporation Software License and Support
Agreement by and between Interliant Networks, Inc. and The
Vantive Corporation, dated as of September 29, 1998.*
10.4 -- Addendum to The Vantive Corporation Software License and
Support Agreement by and between Sage Networks, Inc. and The
Vantive Corporation, dated as of September 29, 1998.*
10.5 -- Master Discounted Internet Services Agreement by and between
UUNET Technologies, Inc. and Sage Networks, Inc., dated
February 17, 1999.*
10.6 -- Joint Development Agreement between Lotus Development
Corporation and Interliant, Inc., dated as of April 27,
1998.*
10.7 -- Sage Networks, Inc. 1998 Stock Option Plan.*
10.8 -- Form of ISO Award Agreement.*
10.9 -- Form of Incentive Stock Option Award Agreement between Sage
Networks, Inc. and the individual Optionee.*
10.10 -- Form of Nonqualified Stock Option Award Agreement between
Sage Networks, Inc. and the individual Optionee.*
10.11 -- Employment Agreement by and between Sage Networks, Inc., and
Leonard J. Fassler, dated January 1, 1999.*
10.12 -- Consulting Agreement by and between Sage Networks, Inc., and
Intensity Ventures, Inc., dated January 1, 1999.*
10.13 -- Employment Agreement by and between Sage Networks, Inc., and
Stephen W. Maggs, dated January 1, 1999.*
10.14 -- Employment Agreement by and between Sage Networks, Inc., and
Rajat Bhargava, dated January 1, 1999.*
10.15 -- Employment Agreement between Sage Networks, Inc. and James
M. Lidestri, dated March 3, 1999.*
10.16 -- Deed of Lease by and between Westwood Center, LLC and Sage
Networks, Inc., dated February 11, 1999.*
10.17 -- Sublease Agreement by and between Southern Company Services,
Inc. and Sage Networks, Inc., dated May 29, 1998.*
10.18 -- First Amendment to Sublease Agreement by and between
Southern Company Services, Inc. and Sage Networks, Inc.,
dated December 15, 1998.*
10.19 -- Sublease Agreement by and between Leuko Site, Inc. and Sage
Networks, Inc., dated November 17, 1998.*
10.20 -- Agreement for Terminal Facilities Collocation Space by and
between Comstor Corporation and Sage Networks, Inc., dated
as of July 2, 1998.*
10.21 -- Standard Lease Agreement, dated June 11, 1995, between
LaSalle Partners Management Limited (as agent for Fannin
Street Limited Partnership) and Wolf Communications
Company.*
10.22 -- First Amendment to Standard Lease, dated January 18, 1996,
between LaSalle Partners Management Limited (as agent for
Fannin Street Limited Partnership) and Wolf Communications
Company.*
10.23 -- Second Amendment to Standard Lease, dated August 8, 1996,
between LaSalle Partners Management Limited (as agent for
Fannin Street Limited Partnership) and Wolf Communications
Company.*
10.24 -- First Amendment to Lease Agreement, between Westwood Center,
L.I.C. and Interliant, Inc., dated June 28, 1999.
10.25 -- Master Lease Agreement between Leasing Technologies
International, Inc. and Interliant, Inc., dated June 9,
1999.
10.26 -- Agreement of Lease between Purchase Corporate Park
Associates and Courtaulds United States Inc., dated August
23, 1991
10.27 -- Sublease, by and between Akzo Nobel Courtalds United States,
Inc. and Interliant, Inc., dated as of May 11, 1999.
</TABLE>
<PAGE> 13
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION PAGE
- ------- ----------- ----
<C> <C> <S> <C>
10.28 -- Agreement of Lease, between Purchase Corporate Park
Associates, L.P. and Interliant, Inc., dated as of June 16,
1999 (Interliant I).
10.29 -- Agreement of Lease, between Purchase Corporate Park
Associates, L.P. and Interliant, Inc., dated as of June 16,
1999 (Interliant II).
10.30 -- Agreement of Lease, between Purchase Corporate Park
Associates, L.P. and Interliant, Inc., dated as of June 16,
1999 (Interliant III).
21.1 -- List of Subsidiaries.*
23.1 -- Consent of Ernst & Young LLP with respect to the financial
statements of Interliant, Inc. (formerly known as Sage
Networks, Inc.).*
23.2 -- Consent of Ernst & Young LLP with respect to the financial
statements of Interliant, Inc. (which is not the registrant
and which is referred to in this prospectus as Interliant
Texas.)*
23.3 -- Consent of Urbach Kahn & Werlin PC.*
23.4 -- Consent of BSC&E.*
23.5 -- Consent of PricewaterhouseCoopers LLP.*
23.6 -- Consent of Frankel, Lodgen, Locher, Golditch, Sardi &
Howard.*
23.7 -- Consent of BDO Seidman, LLP.*
23.8 -- Consent of Deloitte & Touche LLP.*
23.9 -- Consent of Dewey Ballantine LLP (contained in Exhibit 5.1).
24.1 -- Power of Attorney (included on page II-5).*
27.1 -- Financial Data Schedule.*
99.1 -- Consent of Director Nominee.*
</TABLE>
- ---------------
* Previously filed.
(b) Consolidated Financial Statement Schedules
All schedules have been omitted because they are not required or because
the required information is given in the Consolidated Financial Statements or
Notes thereto.
<PAGE> 1
Exhibit 10.24
FIRST AMENDMENT TO LEASE AGREEMENT
THIS FIRST AMENDMENT TO LEASE AGREEMENT (this "Amendment") is dated as of
June 28, 1999 between WESTWOOD CENTER, L.L.C., a Delaware limited liability
company ("Landlord"), and INTERLIANT, INC., (formerly known as Sage Networks,
Inc.), a Delaware corporation ("Tenant").
WITNESSETH
WHEREAS, Landlord entered into a Deed of Lease with Tenant dated as of
February 12, 1999 (the "Lease"), whereby Tenant leased from Landlord certain
commercial office premises (the "Premises") located on the first floor of the
property located at 8619 Westwood Center Drive, Vienna, Virginia (the
"Building");
WHEREAS, Tenant desires to lease from Landlord and Landlord desires to
lease to Tenant the remaining square footage located on the first floor of the
Building, on the same terms and conditions as contained in the Lease as amended
and modified hereby.
NOW, THEREFORE, in consideration of the premises and agreements herein
contained, the parties hereto agree as follows:
1. Defined Terms. All capitalized terms used and not otherwise defined
herein shall have the meanings ascribed to them in the Lease and the work
agreement attached as Exhibit C thereto.
2. Effective Date. This Amendment shall constitute a present and binding
agreement between the parties hereto which shall be effective as of the date
hereof.
3. Expansion Space. "Expansion Space" with respect to this Amendment shall
mean that portion of the Building on the first (1st) floor of the Building which
is demised hereunder by Landlord to Tenant and which is described and depicted
as "Wing A" in Exhibit A to the Lease.
4. Expansion Space Commencement Date. The Expansion Space Commencement
Date hereunder shall be September 1,1999.
5. Premises. From and after the Expansion Space Commencement Date,
"Premises" shall mean, in addition to those portions of the Building included in
the meaning of Premises under the Lease, (i) the Expansion Space, such that the
Premises consist of the entirety of the first floor of the Building, (exclusive
of the Common Areas), containing 22,270 rentable square feet, and (ii) that pad
location on the Site Plan (as defined in the Lease) on which Tenant's
generator(s) and fuel tank is located, as generally depicted on Exhibit A
attached to this Amendment. The definition of Premises as set forth in this
Section 5 shall be applicable for all
<PAGE> 2
purposes of the Lease, including, but not limited to, the calculation of
Tenant's Share and the calculation of Base and Additional Rent
6. Tenant's Share. Commencing upon the Expansion Space Commencement Date,
"Tenant's Share" shall mean 22.94% (22,270/97,081).
7. Construction of Tenant Improvements. "Tenant's Work" hereunder shall
mean the construction of the Tenant Improvements within the Expansion Space in
accordance with the Approved Plans as defined in Exhibit C to the Lease. The
Improvement Allowance as set forth in such Exhibit C is hereby increased to an
aggregate $222,700.00, calculated at $10.00 per rentable square foot of the
Premises. Access to the Expansion Space shall be given to Tenant on June 15,
1999 for purposes of Tenant's performance of Tenant's Work (but not for Tenant's
occupancy thereof).
8. Term. The term of the Lease applicable to the Expansion Space shall
commence on September 1, 1999, and expire one hundred twenty (120) months
thereafter. The Term of the Lease as set forth in Section 1.3 thereof is hereby
amended and modified to be coterminous with the term of the Expansion Space; it
being the intent hereof that the Term of the Lease shall expire on August 31,
2009.
9. Security Deposit. Within three (3) business days after the date hereof,
Tenant shall increase (i) the Security Deposit as set forth in Section 3.1 of
the Lease to an aggregate Two Hundred Fifty Thousand Dollars ($250,000.00), and
(ii) the Advance Deposit as set forth in Section 3.2 of the Lease to an
aggregate $43,612.08.
10. Base Rent. The annual Base Rent for the Expansion Space (which shall
be paid in monthly installments as a portion of the "Monthly Base Rent" under
and pursuant to the Lease) for the initial Lease Year of the Term of the
Expansion Space shall be Twenty Three Dollars and Fifty Cents ($23.50) per
square foot of the Expansion Space. Base Rent is "net" of electrical service
which will be contracted for and paid directly by Tenant. As of September 1,
2000, and each subsequent annual anniversary of the Expansion Space Commencement
Date thereafter, the Base Rent for the Expansion Space shall be increased to an
amount equal to one hundred three percent (103%) of the Base Rent for the
Expansion Space for the immediately preceding Lease Year. The foregoing shall
not affect the scheduled escalation of Base Rent for the initial Premises as
originally set forth in the Lease, which shall remain as originally contemplated
therein (it being the intent hereof that the Base Rent applicable to the
Expansion Space shall be adjusted as of September 1 of each year, and the Base
Rent applicable to the balance of the Premises shall be adjusted as of July 1 of
each year).
11. Assignment; Subleasing. Tenant's right to sublease and or assign the
Expansion Space shall be as set forth in Article 21 of the Lease.
12. Right of First Offer
12.1 Provided that Tenant is not in default under the Lease, Tenant
shall have a right of first offer to lease any space (except space leased to
Tenant) which is not currently vacant
<PAGE> 3
but subsequently is leased and then becomes available for re-lease on the 8370-5
floor of the Building during the Lease Term (hereinafter "Qualifying Space").
Notwithstanding the preceding sentence, (i) this right of first offer is subject
and subordinate to the rights of existing Building tenants, including without
limitation, any renewal, expansion, or any other contractual options to lease or
occupy space within the Building previously granted to such existing Building
tenants, and/or the holding over of such existing tenant(s); (ii) Tenant shall
not have a right of first offer in the event that leasing the Qualifying Space
to Tenant would "adversely affect the leasability of the remaining space" (as
defined below); and (iii) Landlord shall have no obligation to offer this right
of first offer to Tenant more than once on any Qualifying Space.
12.2 For purposes of this Lease, leasing a Qualifying Space to
Tenant shall "adversely affect the leasability of the remaining space" if the
remaining space on such floor is of a configuration which hinders the
marketability of the remaining space to potential Building tenants or renders
the space unsuitable for its intended use (including without limitation,
configurations which consist of only interior space or space which has
disproportionately few or no windows; space which is not contiguous; space which
is oddly-shaped or includes a disproportionate amount of Building core areas;
space for which there is limited or no access to or from the common areas of the
Building; or space for which it is disproportionately expensive or impractical
to partition or provide utilities or other services for). Tenant expressly
agrees that Landlord's determination, which shall be made in Landlord's sole
discretion, regarding whether leasing a Qualifying Space to Tenant would
adversely affect the leasability of the remaining space, shall be determinative.
12.3 In the event any Qualifying Space becomes available during the
Term, Landlord shall, if ascertainable, notify Tenant in writing of the size and
location of such space (the "Offered Space") at least three (3) months prior to
the expiration of the lease term applicable to such Offered Space. Landlord's
notice shall be hereafter referred to as the "Offer Notice". The Offer Notice
shall include the lease term for the Offered Space, which shall be coterminous
with the Lease Term (or, if applicable, the Renewal Term) of the initially
leased Premises, regardless of when the Offered Space becomes available.
12.4 The Offer Notice shall specify that the terms and conditions
for leasing the Offered Space shall be the identical to the terms and conditions
in this Lease, except that the rental rate and tenant improvement allowance for
the Offered Space shall be the current rental rate and interior improvement
allowance being offered by Landlord for comparable space in the Building. The
Offer Notice shall state the dollar amounts of such rental rate and allowance
(the amount of such allowance being adjusted based upon the number of months
then remaining in the Term).
12.5 Tenant shall have fifteen (15) business days after receipt of
the Offer Notice to (i) exercise its right of first offer by giving Landlord
written notice of Tenant's election to lease all (but not less than all) of,
such Offered Space ("Tenant's Election Notice"), or (ii) elect not to exercise
its right of first offer for the Offered Space.
12.6 In the event Tenant exercises its right of first offer to lease
the Offered
<PAGE> 4
within such fifteen (15) business day period for an Offered Space then Tenant
and Landlord shall execute an Amendment to this Lease as follows: Landlord shall
promptly prepare and deliver to Tenant an Amendment to this Lease (the
"Amendment") which brings the Offered Space under the terms and conditions of
the Lease. Specifically, the Amendment shall: (i) make the square footage of the
Offered Space part of the Premises; (ii) specify that the rental rate and
allowance for the Offered Space is then current rental rate stated in the Offer
Notice; (iii) specify that Tenant shall accept the Offered Space in "as-is"
condition (subject to the allowance), and that Tenant shall not receive any free
rent or reduced rent for the Offered Space; (iv) increase Tenant's Proportionate
Share to include the Offered Space; (v) specify that the commencement date for
the Offered Space shall be forty five (45) days after the date on which the
Offered Space becomes vacant; (vi) specify that any improvements or construction
that Tenant performs in the Offered Space shall be treated as an "Alteration"
pursuant to the Lease; and (vii) specify that, except for (i) - (vi), all other
terms and conditions of the Lease shall remain in full force and effect and with
respect to the Premises and the Offered Space. Tenant shall execute and deliver
the Amendment to Landlord within five (5) days after Tenant's receipt of the
Amendment, in a form mutually satisfactory to Landlord and Tenant.
12.7 In the event Tenant fails or declines to exercise its right of
first offer within the requisite time periods in accordance with this Section 12
with respect to a particular Offered Space, or in the event Tenant fails or
declines to execute and deliver the Amendment for an Offered Space within the
requisite time period after Tenant exercises its right of first offer, then
Tenant's right of first offer with respect to that particular Offered Space
shall be extinguished and shall thereafter be null and void and of no further
force and effect, and Landlord shall thereafter have the right to lease such
Offered Space to third parties on such terms as Landlord (in its sole
discretion) deems appropriate, without any further notification to Tenant.
12.8 Time is of the essence in this Section 12.
12.9 Tenant acknowledges and agrees that this right of first offer
and any other rights granted under this Section 12 are granted exclusively to
Tenant and not to any assignee or sublessee of Tenant; unless such assignee is
an entity which acquired substantially all of the assets or capital stock of
Tenant or is an entity into which Tenant has merged.
13. Complete Agreement; No Other Modification. This Amendment and the
Lease contain the entire agreement of the parties hereto and no representations,
inducements, promises, or agreements, oral or otherwise, between the parties not
embodied herein, shall be of any force or effect. This Amendment may not be
amended, modified, or canceled except by written agreement executed by both
parties. Except as otherwise expressly set forth herein, the terms and
provisions of the Lease are and shall remain in full force and effect.
<PAGE> 5
IN WITNESS WHEREOF, the parties hereto have executed this First Amendment
on the date and year first above written.
LANDLORD:
WESTWOOD CENTER, L.L.C.
__________________ By: /s/ John B. Detwiler
_______________________
Name: John B. Detwiler
Title: Vice President
TENANT:
INTERLIANT, INC.
__________________ By: /s/ James M. Lidestri
______________________
Name: James M. Lidestri
Title: President
<PAGE> 1
Exhibit 10.25
MASTER LEASE AGREEMENT
This Master Lease Agreement (the "Lease") is made the 9th day of June, 1999
between Leasing Technologies International, Inc., with its principal office at
221 Danbury Road, Wilton, CT 06897 (the "Lessor"), and Interliant, Inc., with
its principal office at Two Manhattanville Road, Purchase, New York 10577 (the
"Lessee").
The parties hereto agree as follows:
1. Lease:
This Lease establishes the general terms and conditions by which Lessor
may lease to Lessee die Equipment (the "Equipment") listed on each Equipment
Schedule executed periodically pursuant to this Lease. Each such Equipment
Schedule shall incorporate by reference the terms of this Lease, and shall be a
separate lease agreement as to the Equipment listed thereon for all purposes,
including default. In the event of any conflict between the terms and conditions
of this Lease and the terms and conditions of any Equipment Schedule(s) or
Rider(s) thereto, the terms and conditions of such Equipment Schedule(s) or
Rider(s) shall prevail.
2. Definitions:
(a) The "Installation Date" means the date determined in accordance with
the applicable Equipment Schedule.
(b) The "Commencement Date" means, as to any item of Equipment designated
on any Equipment Schedule where the Installation Date for such item of Equipment
falls on the first day of the month, that date, or, in any other case, the first
day of the month following the month in which such installation Date falls.
(c) The "Daily Rental" means 1/30th of the amount set forth as the monthly
rental in the applicable Equipment Schedule.
3. Term of Lease:
The term of this Lease, as to all Equipment designated on any Equipment
Schedule, shall commence on the Installation Date for such Equipment, and shall
continue for an initial period ending that number of months as is specified on
the applicable Equipment Schedule from the Commencement Date for the last item
of Equipment to be installed (the "Initial Term"). The term of this Lease for
all such Equipment shall be automatically extended for successive monthly
periods until terminated in accordance with this Lease. Any termination shall be
effective only on the last day of the initial Term or the last day of any such
successive period.
4. Rental:
The monthly rental payable hereunder is as set forth in the Equipment
Schedule(s). Rental shall begin to accrue on the Installation Date for each item
of Equipment and shall be due and payable by Lessee in advance on the first day
of each month. if the Installation Date does not fall on the first day of a
month, the rental for that period of time from the Installation Date until the
Commencement Date shall be an amount equal to the Daily Rental multiplied by the
number of days from (and including) the Installation Date to (but not including)
the Commencement Date and shall be due and payable on the Installation Date. In
addition to the monthly rental set forth in the Equipment Schedule(s), Lessee
shall pay to Lessor an amount equal to all taxes paid, payable or required to be
collected by Lessor, however designated, which are levied or based on the
rental, on the Lease or on the Equipment or on its purchase for lease hereunder,
or on its use, lease, operation, control or value (including, without
limitation, state and local privilege or excise taxes based on gross revenue),
any penalties or interest in connection therewith which are attributable to
Lessee's negligence or taxes or amounts in lieu thereof paid or payable by
Lessor in respect of the foregoing, but excluding taxes based on Lessor's net
income. Personal property taxes assessed on the Equipment during the term hereof
shall be paid by Lessee. Lessee agrees that Lessor, or Lessor's agent may file
all required property tax returns and reports and pay all taxes thereon
pertaining to the Equipment. In such event, Lessee shall reimburse Lessor or
Lessor's agent for all costs and expenses incurred in connection therewith,
provided that such costs and expenses (including property taxes) shall not
exceed the property taxes pursuant to statutory tax rates and regulations. If
requested by Lessor, Lessee agrees to file, on behalf of Lessor, all required
property tax returns and reports concerning the Equipment with all appropriate
governmental agencies, and, within not more than thirty (30) days after the due
date of such filing to send Lessor confirmation of such filing.
Interest on any past due payments, including but not limited to
administrative charges and any other charges or fees arising out of or related
to this Lease, shall accrue at the rate of 1 1/2% per month, or if such rate
shall exceed the
COUNTERPART NO. 2 of 2
<PAGE> 2
maximum rate allowed by law, then at such maximum rate, and shall be payable on
demand. Charges for taxes, penalties and interest shall be promptly paid by
Lessee when invoiced by Lessor.
As security for the full performance of all of Lessee's obligations under
each Equipment Schedule, Lessee shall, simultaneously with the execution and
delivery of each Equipment Schedule, deposit with Lessor the amount set forth on
such Equipment Schedule. The security deposit shall be promptly returned to
Lessee by Lessor upon the expiration of such Equipment Schedule and return or
purchase of all Equipment, as the case may be, provided that all Lessee
obligations under such Equipment Schedule have been fulfilled.
5. Installation, Use and Quiet Possession of Equipment:
(a) Lessee, at its own expense, will provide the required suitable
electric current to operate the Equipment and appropriate installation
facilities as specified by the manufacturer.
(b) Any equipment, cards, disks, tapes or other items not specified in the
Equipment Schedule(s) which are used on or in connection with the Equipment must
meet the specifications of the manufacturer and shall be acquired by Lessee at
its own expense.
(c) Lessee shall use the Equipment solely in connection with Lessee's
business and for no other purpose. Subject to the preceding sentence, Lessee
shall be entitled to unlimited usage of the Equipment without extra charge by
Lessor.
(d) Unless otherwise set forth in the applicable Equipment Schedule,
Lessee will at all times keep the Equipment in its sole possession and control.
The Equipment shall not be moved from the location stated in the applicable
Equipment Schedule without the prior written consent of Lessor which shall not
be unreasonably withheld or delayed.
(e) After prior notice to Lessor, Lessee may, at its own expense, make
alterations in or add attachments to the Equipment, provided such alterations or
attachments do not interfere with the normal and satisfactory operation or
maintenance of the Equipment or with Lessee's ability to obtain and maintain the
maintenance contract required by Section 5(h) hereof. The manufacturer or other
organization selected by Lessee and approved in writing by Lessor to maintain
the Equipment ("Maintenance Organization") may incorporate engineering changes
or make temporary alterations to the Equipment upon request of Lessee. All such
alterations and attachments shall be and become the property of Lessor or, at
the option of Lessee, shall be removed by Lessee and the Equipment restored, at
Lessee's expense, to its original condition as of the Installation Date thereof,
reasonable wear and tear only excepted, and upon the removal and restoration,
the alteration and/or attachment which was made by Lessee shall become the
property of Lessee. Notwithstanding anything to the contrary contained herein,
(i) Lessee shall be permitted, without the consent of Lessor, to load software
and make configuration or other changes to the Equipment as are reasonably
appropriate to operate Lessee's business provided that such alterations or
additions do not adversely affect the value thereof or the ability to operate,
maintain and remove the Equipment. The alterations and additions set forth in
the immediately preceding sentence need not be removed at the termination or
expiration of this Agreement.
(f) So long as Lessee in Lessor's reasonable judgement, is not in default
hereunder, neither Lessor nor any party claiming through or under Lessor shall
interfere with Lessee's use or possession of any Equipment during the term of
this Lease.
(g) Lessee shall, during the term of this Lease, at its expense, keep the
Equipment in good working order and condition and make all necessary
adjustments, repairs and replacements and shall not use or permit the Equipment
to be used in any manner or for any purpose for which, in the opinion of the
manufacturer, the Equipment is not designed or reasonably suitable.
(h) Unless otherwise set forth in the applicable Equipment Schedule,
Lessee shall, during the term of this Lease, at its own expense, enter into and
maintain in force a contract with the manufacturer or the Maintenance
Organization covering at least prime shift maintenance of each item of
Equipment. Such contract shall commence upon expiration of the manufacturer's
warranty period, if any, relating to such item. Lessee shall furnish Lessor with
a copy of such contract(s).
(i) At the termination of the applicable Equipment Schedule, Lessee at its
expense shall make available for return at Lessee's place of business, if
permitted by the applicable Equipment Schedule, not less than all the Equipment
subject thereto to Lessor (at the location designated by Lessor within the
Continental United States up to a maximum
<PAGE> 3
distance of 500 miles) in the same operating order, repair, condition and
appearance as on the Installation Date, reasonable wear and tear only excepted,
with all engineering and safety changes prescribed by the manufacturer or
Maintenance Organization incorporated therein. Lessee shall, prior to such
termination, arrange and pay for any repairs, changes and manufacturers
certifications as are necessary for the manufacturer or Maintenance Organization
to accept the Equipment under contract maintenance at its then standard rates.
Lessee shall return all accessories supplied with the Equipment, including but
nor limited to all manuals, cables and software diskettes. Lessee shall promptly
pay, after receipt of an invoice therefore, all reasonable costs and expenses
pertaining to the replacement of any missing accessories and for the repair of
any Equipment reasonable wear and tear excluded, together with any audit,
inspection or certification charges reasonably incurred by Lessor.
6. Leasehold Rights and Inspection:
(a) Lessee shall have no interest in the Equipment other than the rights
acquired as a lessee hereunder and the Equipment shall remain personalty
regardless of the manner in which it may be installed or attached. Lessee shall,
at Lessor's request, affix to the Equipment, tags, decals or plates tarnished by
Lessor, indicating Lessor's ownership and Lessee shall not permit their removal
or concealment. Lessee shall replace any such tag, decal or plate which may be
removed or destroyed or become illegible. Lessee shall keep all Equipment free
from any marking or labeling which might be interpreted as a claim of ownership
thereof by Lessee or any party other than Lessor or anyone claiming through
Lessor.
(b) Lessee shall keep the Equipment free and clear of all liens and
encumbrances except liens or encumbrances arising through the actions or
omissions of Lessor. LESSEE SHALL NOT ASSIGN OR OTHERWISE ENCUMBER THIS LEASE OR
ANY OF ITS RIGHTS HEREUNDER OR SUBLEASE THE EQUIPMENT WITHOUT THE PRIOR WRITTEN
CONSENT OF LESSOR except that Lessee may assign this Lease or sublease the
Equipment to its parent or any subsidiary corporation, or to a corporation which
shall have acquired all or substantially all of the property of Lessee by
merger, consolidation or purchase. No permitted assignment or sublease shall
relieve Lessee of any of its obligations hereunder.
(c) Lessor or its agents shall have free access to the Equipment during
normal business hours, and, except in case of emergency or if a default has
occurred, upon at least three business days' notice for the purpose of
inspection and for any other purpose contemplated by this Lease.
(d) Lessee shall promptly notify Lessor of all details concerning any
material damage to, or loss of the Equipment arising out of any event or
occurrence whatsoever, including but not limited to, the alleged or apparent
improper manufacture, functioning or operation of the Equipment.
7. No Warranties By Lessor:
Lessee represents that, at the Installation Date thereof, it shall have
(a) thoroughly inspected the Equipment; (a) determined for itself that all items
of Equipment are of a size, design, capacity and manufacture selected by it; and
(c) satisfied itself that the Equipment is suitable for Lessee's purposes.
LESSOR SUPPLIES THE EQUIPMENT AS IS AND NOT BEING THE MANUFACTURER OF THE
EQUIPMENT, THE MANUFACTURER'S AGENT OR THE SELLER'S AGENT, MAKES NO WARRANTY OR
REPRESENTATION, EITHER EXPRESS OR IMPLIED AS TO THE EQUIPMENT'S MERCHANTABILITY,
FITNESS FOR A PARTICULAR PURPOSE, DESIGN, CONDITION, QUALITY, CAPACITY, MATERIAL
OR WORKMANSHIP OR AS TO PATENT INFRINGEMENT OR THE LIKE, it being agreed that
all such risks, as between Lessor and Lessee, are to be borne by Lessee. Lessee
agrees to look solely to the manufacturer, maintenance provider or to suppliers
of the Equipment for any and all warranty claims and any and all warranties made
by the manufacturer or the supplier of Lessor are, to the extent to which the
same may be assignable, hereby assigned to Lessee for the term of the applicable
Equipment Schedule. Lessee agrees that Lessor shall not be responsible for the
delivery, installation, maintenance, operation or service of the Equipment or
for delay or inadequacy of any or all of the foregoing. Except in the case of
Lessor's willful misconduct, Lessor shall not be responsible for any direct or
consequential loss or damage resulting from the installation, operation or use
of the Equipment or otherwise. Except in the case of Lessor's willful
misconduct, Lessee will defend, indemnify and hold Lessor harmless against any
and all claims, demands and liabilities arising out of or in connection with the
design, manufacture, possession or operation of the Equipment.
8. Risk of Loss on Lessee:
(a) Except in the case of Lessor's willful misconduct, beginning on the
Installation Date thereof and continuing until the Equipment is either returned
to Lessor or purchased by Lessee as provided in this Lease, Lessee relieves
Lessor
<PAGE> 4
of responsibility for all risks of physical damage to or loss or destruction of
the Equipment, howsoever caused. During the term of this Lease as to any
Equipment Schedule, Lessee shall, at its own expense, keep in effect "all risk"
property insurance and public liability insurance policies covering the
Equipment designated in each Equipment Schedule. The public liability insurance
policy shall be in such amount as is specified herein. The "all risk" property
insurance policy shall be for an amount not less than the replacement cost of
the Equipment. Lessor, its successors and assigns and/or such other party as may
be designated by any thereof to Lessee, in writing, shall be named as additional
insureds and loss payees on such policies, which shall be written by an
insurance company of recognized responsibility which is reasonably acceptable to
Lessor. Evidence of such insurance coverage shall be furnished to Lessor no
later than the Installation Date set forth in the Equipment Schedule(s) and,
from time to time, thereafter as Lessor may reasonably request. Such policies
shall provide that no less than ten days written notice shall be given Lessor
and any other party named as loss payee prior to cancellation of such policies
for any reason. To the extent of Lessor's interest therein, Lessee hereby
irrevocably appoints Lessor or any other party named as loss payee as Lessee's
attorney-in-fact coupled with an interest solely to make claim for, receive
payment of, and execute any and all documents that may be required to be
provided to the insurance carrier in substantiation of any such claim for loss
or damage under said insurance policies, and upon notice to Lessor, to endorse
Lessee's name to any and all drafts or checks in payment of the loss proceeds.
(b) If any item of Equipment is rendered unusable as a result of any
physical damage to, or destruction of, the Equipment, Lessee shall give to
Lessor prompt notice thereof and this Lease shall continue in full force and
effect without any abatement of rental. Lessee shall determine, within fifteen
(15) days after the date of occurrence of such damage or destruction, whether
such item of Equipment can be repaired. In the event Lessee determines that the
item of Equipment cannot be repaired, Lessee shall either, at its expense,
promptly replace such item of Equipment and convey title to such replacement to
Lessor free and clear of all liens and encumbrances, and this Lease shall
continue in full force and effect as though such damage or destruction had not
occurred, or pay Lessor therefor in cash the Stipulated Loss Value (defined
below) within thirty (30) days of such loss or damage. "Stipulated Loss Value,"
as used herein, shall be an amount as shown on Exhibit A to the applicable
Equipment Schedule. In the event Lessee determines that such item of Equipment
can be repaired, Lessee shall cause such item of Equipment to be promptly
repaired. All proceeds of insurance received by Lessor, the designated loss
payee, or Lessee under the policy referred to in the preceding paragraph of this
Section shall be applied toward the cost of any such repair or replacement so
long as Lessee shall not be in default of its obligations hereunder.
9. Events of Default and Remedies
The occurrence of any one of the following shall constitute an Event of
Default hereunder:
(a) Lessee fails to pay an installment of rent on or before the date when
the same becomes due and payable and such failure continues for a period of five
business days;
(b) Lessee attempts to remove, sell, transfer, encumber, sublet or part
with possession of the Equipment or any items thereof, except as expressly
permitted herein;
(c) Lessee shall fail to observe or perform any of the other material
obligations required to be observed or performed by Lessee hereunder and such
failure shall continue uncured for ten (10) days after written notice thereof to
Lessee by Lessor or the then assignee hereof;
(d) Lessee ceases doing business as a going concern, makes an assignment
for the benefit of creditors, admits in writing its inability to generally pay
its debts as they become due, files a voluntary petition of bankruptcy, is
adjudicated a bankrupt or an insolvent, files a petition seeking for itself any
reorganization, arrangement, composition, readjustment, liquidation, dissolution
or similar arrangement under any present or future statute, law or regulation or
files an answer admitting the material allegations of the petition filed against
it in any such proceeding, consents to or acquiesces in the appointment of a
trustee, receiver, or liquidator of it or of all or any substantial part of its
assets or properties, or if it or its shareholders shall take any action looking
to its dissolution or liquidation;
(e) Within sixty (60) days after the commencement of any proceedings
against Lessee seeking reorganization, arrangement, readjustment, liquidation,
dissolution or similar relief under any present or future statute, law or
regulation, such proceedings shall not have been dismissed, or if within sixty
(60) days after the appointment without Lessee's consent or acquiescence of any
trustee, receiver or liquidator of it or of all or any substantial part of its
assets and properties, such appointment shall not be vacated;
(f) Lessee defaults in the performance or observation of any material
term, condition or covenant of any loan agreement, indenture, trust agreement,
lease or similar agreement to which Lessee is a party or by which Lessee is
bound
<PAGE> 5
involving an obligation by Lessee to pay more than $100,000 and such default
continues beyond any applicable cure period;
(g) Lessee enters into any transaction, the effect of which adversely
affects (i) a material portion of Lessee's business value and (ii) the ability
of Lessee, in Lessor's reasonable judgment, to repay Lessee's obligations under
the Lease as they become due.
Upon the occurrence of an Event of Default, Lessor may at its option do
any one or more of the following: (i) by written notice to Lessee terminate this
Lease as to any or all Equipment Schedules; (ii) whether or not this Lease is
terminated as to any or all Equipment Schedules, take possession on not less
than three (3) days' notice of any or all of the Equipment listed on any or all
Equipment Schedules, wherever situated, and for such purpose, enter upon any
premises without liability for so doing or Lessor may cause Lessee and Lessee
hereby agrees, to return said Equipment to Lessor as provided in this Lease;
(iii) recover from Lessee, as liquidated damages for loss of a bargain and not
as a penalty, all past due amounts as well as an amount equal to the present
value of all monies to be paid by Lessee during the remaining Initial Term or
any successive period then in effect, calculated by discounting at the rate of
six percent (6%) per annum compounded monthly, which payment shall become
immediately due and payable; and (iv) sell, dispose of, hold, use or lease any
Equipment as Lessor in its sole discretion may determine (and Lessor shall not
be obligated to give preference to the sale, lease or other disposition of the
Equipment over the sale, lease or other disposition of similar equipment owned
or leased by Lessor).
In the event that Lessee shall have first paid to Lessor or its assigns
the liquidated damages referred to in (iii) above, Lessee shall thereafter be
entitled to receive all rentals or proceeds received from any reletting or sale
of the Equipment during the balance of the Initial Term (after deduction of
Lessor's expected residual value of the Equipment at the expiration of the
Initial Term or any extension thereof and of all expenses incurred in connection
therewith) said amount never to exceed the amount of the liquidated damages paid
by Lessee. Lessee agrees that Lessor shall have no obligation to sell the
Equipment. Lessee shall in any event remain fully liable for reasonable damages
as provided by law and for all reasonable costs and expenses incurred by Lessor
or its assigns on account of such default including but not limited to all court
costs and reasonable attorney's fees. Lessee hereby agrees that, in any event,
it will be liable for any deficiency after any lease or other disposition of the
Equipment. The rights afforded Lessor hereunder shall not be deemed to be
exclusive, but shall be in addition to any rights or remedies provided by law.
10. Net Lease:
Except as otherwise specifically provided in this Lease, it is understood
and agreed that this is a net lease, and that, as between Lessor and Lessee,
Lessee shall be responsible for all reasonable costs and expenses of every
nature whatsoever arising out of or in connection with or related to this Lease
or the Equipment (including, but not limited to, equipment inspection, tagging,
transportation in and out, rigging, manufacturer's approved packing,
installation, certification costs and disconnect charges). Lessee hereby agrees
that in the event that Lessee fails to pay or perform any obligation under this
Lease, Lessor may, at its option, pay or perform said obligation and any
reasonable payment made or expense incurred by Lessor in connection therewith
shall become additional rent which shall be due and payable by Lessee upon
demand. Lessee acknowledges that Lessor may, from time to time, and at Lessee's
request, execute and deliver purchase orders pertaining to the purchase of
equipment to be leased pursuant to this Lease. Lessee agrees that it will
indemnify and hold Lessor harmless from and against any and all loss, cost,
liability and expense that Lessor may incur as a result of the execution and
delivery of such purchase orders.
11. Assignment:
Lessee agrees that Lessor may transfer or assign all or any part of
Lessor's right, title, and interest in, under or to the Equipment and this Lease
and any or all sums due or to become due pursuant to any of the above, to any
third party (the "Assignee") for any reason and that the Assignee may so
re-assign and transfer. Lessee agrees that upon receipt of written notice from
Lessor or Assignee of such assignment, Lessee shall perform all of its
obligations hereunder for the benefit of Assignee and any successor assignee
and, if so directed, shall pay all sums due or to become due thereunder directly
to the Assignee or to any other party designated by the Assignee. Lessee hereby
covenants, represents and warrants as follows and agrees that the Assignee and
any successor assignee shall be entitled to rely on and shall be considered a
third party beneficiary of the following covenants, representations and
warranties: (i) Lessee's obligations hereunder are absolute and unconditional
and are not subject to any abatement, reduction, recoupment, defense, offset or
counterclaim available to Lessee for any reason whatsoever including operation
of law, defect in the Equipment, failure of Lessor or Assignee to perform any of
its obligations hereunder or for any other cause or reason whatsoever, whether
similar or dissimilar to the foregoing; (ii) Lessee shall not look to Assignee
or any successor assignee to perform any of Lessor's obligations hereunder,
provided Lessor shall remain liable therefor; (iii) Lessee will
<PAGE> 6
not amend or modify this Agreement without the prior written consent of the
Assignee and any successor assignee; and (iv) Lessee will send a copy to
Assignee and any successor assignee of each notice which Lessee sends to Lessor.
12. Representations and Warranties of Lessee and Lessor:
Lessee represents and warrants to Lessor and its assigns, as follows:
1. The execution, delivery and performance of this Lease has been duly
authorized and, upon execution by Lessor and Lessee, will constitute a valid
obligation binding upon and enforceable against Lessee in accordance with its
terms, subject to laws governing creditors' rights;
2. The performance by Lessee will not result in any breach, default or
violation of Lessee's certificate of incorporation or by-laws or any agreement
to which Lessee is a party;
3. Lessee is in good standing in its jurisdiction of incorporation and in
any jurisdiction in which any of the Equipment is to be located; and
4. Any and all financial statements or other information with respect to
Lessee heretofore furnished by Lessee to Lessor was, when furnished, and remains
at the time of execution of this Lease, true and complete.
Lessor represents and warrants to Lessee as follows:
1. The execution, delivery and performance of this Lease has been duly
authorized and, upon execution by Lessor and Lessee, will constitute a valid
obligation binding upon and enforceable against Lessor in accordance with its
terms, subject to laws governing creditors' rights; and
2. The performance by Lessor will not result in any breach, default or
violation of Lessor's certificate of incorporation or by-laws or any agreement
to which Lessor is a party;
The foregoing representations and warranties shall survive the expiration
or termination of this Lease.
13. End of Lease:
Provided (i) no Event of Default has occurred and is continuing and (ii)
Lessee has made all payments in accordance with the Lease, upon written notice
furnished by Lessee no later than three (3) months prior to the expiration of
the Initial Term, Lessee shall, with respect to each Equipment Schedule elect
only such alternatives as may be set forth on the Equipment Schedule.
To the extent that any of such alternatives involves a determination of
Fair Market Value, the Fair Market Value shall be defined and determined by the
provisions of this Section. For purposes hereof, Fair Market Value shall mean
the amount that would be obtained in a retail arm's length transaction between
an informed and willing lessee-buyer in possession and an informed and willing
lessor-seller. Rental charges previously paid pursuant to the applicable
Equipment Schedule shall have no effect on the determination of Fair Market
Value. Unless otherwise stated in the Equipment Schedule: the Fair Market Value
for items set forth on the Equipment Schedule which do not have a readily
ascertainable market value, (including but not limited to software, cabling and
certain equipment) shall be determined by multiplying the Lessors acquisition
cost of such items by a fraction, the numerator of which shall be the Fair
Market Value of the other items and the denominator of which shall be the
Lessor's acquisition cost of such other items; and the determination of Fair
Market Value shall be based upon the assumption that all items set forth on the
Equipment Schedule or included with the Equipment may be transferred to, and
used by, a third party user. In such determination, all alternative uses in the
hands of each buyer or lessee, including, without limitation, the further
leasing of the Equipment shall be taken into account in making such
determination.
Not less than ninety (90) days prior to the end of the Initial Term,
Lessee may provide written notice to Lessor of Lessee's intention to exercise
the purchase or extension option described above. If, on or before a date sixty
(60) days prior to the expiration of the Initial term Lessor and Lessee are
unable to agree upon a determination of the fair market value of the Equipment,
such Fair Market Value shall be determined in accordance with the procedure for
appraisal as described below. After a determination of the Fair Market Value of
the Equipment has been made in accordance with the procedure described below,
Lessee may exercise its option to purchase the Equipment for the Fair Market
Value thereof by delivering written notice to Lessor not more than ten (10) days
after completion of appraisal as described below.
<PAGE> 7
Appraisal shall mean a procedure whereby two independent appraisers,
neither of whom shall be a manufacturer of such Items of Equipment, one chosen
by Lessee and one by Lessor, shall mutually agree upon the amount in question
based upon the definition set forth below. Each party shall deliver a written
notice to the other party appointing its appraiser on or before a date sixty
days prior to the expiration of the Initial Term. If within fifteen (15) days
after appointment of the two appraisers as described above, the two appraisers
are unable to agree upon the amount in question, a third independent appraiser,
who shall not be a manufacturer of such Items of Equipment, shall be chosen
within five (5) business days thereafter by the mutual consent of such first two
appraisers or, if such first two appraisers fail to agree upon the appointment
of a third appraiser, such appointment shall be made by an authorized
representative of the American Arbitration Association or any organization
successor thereof. The decision of the third appraiser so appointed and chosen
shall be given ten (10) business days after the selection of such third
appraiser. Lessee shall pay the fees and expenses of all appraisers, if any. The
Lease, including the obligation to pay monthly rentals, shall remain in effect
pending the determination of Fair Market Value.
14. Miscellaneous:
(a) During the term of this Lease until such time as a public offering is
completed, Lessee hereby agrees to deliver to Lessor or Assignee and any
successor assignee a copy of Lessee's monthly unaudited financial statements,
and the annual financial budget for the upcoming year as soon as available and
as it may be adjusted during the year. Upon completion of such public offering
Lessee shall furnish quarterly financial statements to Lessor; provided however,
that if any creditor of Lessee is furnished monthly financial statements,
(including but not limited to budgets), Lessee shall furnish such monthly
financial statements to Lessor. Lessee shall also furnish, as soon as available
and in any event within ninety (90) days after the last day of Lessee's fiscal
year, a copy of Lessee's annual audited statements and consolidating and
consolidated balance sheet, if any, as of the end of such fiscal year,
accompanied by the opinion of an independent certified public accounting firm of
recognized standing. The Lessee shall furnish such other financial information
as may be reasonably requested by Lessor, including but not limited to any
material changes in budgets or financial reports furnished to the Lessee's Board
of Directors or Shareholders.
(b) This Lease constitutes the entire agreement between Lessee and Lessor
with respect to the Equipment, and except as agreed upon in writing no covenant,
condition or other term or provision hereof may be waived or modified orally.
(c) All notices hereunder shall be in writing and shall be delivered in
person or sent by registered or certified mail, postage prepaid, or by facsimile
transmission (confirmed by registered mail as set forth in this section) to the
address of the other party as set forth herein or to such other address as such
party shall have designated by proper notice with a copy to Interliant, Inc.,
Attention: General Counsel, Two ManhattanVille Road, Purchase, New York 10577.
(d) This Lease shall be binding upon and inure to the benefit of Lessor
and Lessee and their respective successors and assigns (including any subsequent
assignee of Assignee).
(e) If any term or provision of this Lease or the application thereof to
any person is, to any extent, invalid or unenforceable, the remainder of this
Lease, or the application of such provision to the person other than those to
which it is invalid or unenforceable, shall not be affected thereby, and each
provision of this Lease shall be valid and be enforced to the fullest extent
permitted by law.
(f) No waiver of any of the terms and conditions hereof shall be effective
unless in writing and signed by the party against whom such waiver is sought to
be enforced. Any waiver of the terms hereof shall be effective only in the
specific instance and for the specific purpose given. The subsequent acceptance
of rental payments hereunder by Lessor shall not be deemed a waiver of any prior
existing breach by Lessee regardless of Lessor's knowledge of such prior
existing breach at the time of acceptance of such rental payments. Where
permitted by law, Lessee authorizes any attorney of record, Clerk of Court or
Prothonotary of any state to appear for and confess judgment (a) against Lessee
for all amounts as to which Lessee is in default under this Agreement and (b)
against Lessee in any action for writ of replevin or possession of the
Equipment. No bond shall be required.
(g) Lessor is hereby authorized by Lessee to cause this Lease or other
instruments, including Uniform Commercial Code Financing Statements to be filed
or recorded for the purpose of showing Lessor's interest in the Equipment and
Lessee agrees that Lessor may execute such instruments for and on behalf of
Lessee. All filing fees
<PAGE> 8
reasonably incurred by Lessor in connection therewith and filing fees incurred
by Lessor's assignees in perfecting security interests shall be paid by Lessee
or reimbursed to Lessor by Lessee.
(h) No consent or approval provided for herein shall be binding upon
Lessor unless signed on its behalf by an officer of Lessor. THIS LEASE AND EACH
EQUIPMENT SCHEDULE SHALL BE DEEMED TO HAVE BEEN MADE IN THE STATE OF CONNECTICUT
AND SHALL BE GOVERNED IN ALL RESPECTS BY THE LAWS OF SUCH STATE. The Lessee
accepts for itself the non-exclusive jurisdiction of any Federal or State court
of competent jurisdiction in the State of Connecticut in any action, suit or
proceeding of any kind against it which arises out of or by reason of this Lease
or any Equipment Schedule.
(i) Lessee acknowledges that the late payment by Lessee to Lessor of
monthly rental and other sums due hereunder will cause Lessor harm and to incur
costs not contemplated by this Lease, the precise amount and severity of which
will be difficult to ascertain. Such costs include, but are not limited to,
administrative, accounting and legal charges which Lessor may incur due to such
late payment. Accordingly, if any monthly rent or any other sum due from Lessee
shall not be received by Lessor or Lessor's assignee within twenty (20) days
after the same is due, Lessee shall pay to Lessor or Lessor's assignee a late
charge equal to five per cent (5%) of such overdue amount monthly until such
overdue amount is paid; provided however, that any such late charge shall only
be imposed once for each such overdue amount. Lessee acknowledges that such late
charge represents a fair and reasonable estimate of the cost Lessor will incur
by reason of a late payment by Lessee. Acceptance of such late charge by Lessor
shall in no event constitute a waiver of Lessee's default, if any, with respect
to such overdue amounts, nor prevent Lessor from exercising any of the other
rights and remedies which Lessor may have pursuant to this Lease.
(j) Any unsatisfied obligations which Lessee is required to perform during
the term of this Lease shall survive the expiration or other termination of this
Lease.
(k) Lessee will promptly execute and deliver to Lessor such further
documents and assurances and take such further action as Lessor may reasonably
request in order to effectuate the intent and purpose of this Lease and to
establish and protect the rights, interests and remedies intended to be created
in favor of Lessor hereunder, including without limitation, the execution and
filing of financing statements and continuation statements with respect to this
Lease, the Equipment and any Equipment Schedule. Lessee authorizes Lessor to
effect any such filing and Lessor's reasonable expenses (together with the
reasonable expenses of Lessor's assignees in this regard) shall be payable by
Lessee on demand.
LESSOR: LESSEE:
Leasing Technologies International, Inc. Interliant, Inc.
BY: /s/ F. Jared Sprole BY: /s/ James M. Lidestri
---------------------------- ----------------------------
NAME: F. Jared Sprole NAME: James M. Lidestri
-------------------------- --------------------------
TITLE: President TITLE: President
------------------------- -------------------------
DATE: 6/14/99 DATE: 6/9/99
-------------------------- --------------------------
COUNTERPART NO. 2 of 2
<PAGE> 9
MASTER NOTE AND SECURITY AGREEMENT
Wilton, Connecticut
Date: June 9, 1999
1. Master Agreement.
(a) This Agreement sets forth the basic terms and conditions upon which
LEASING TECHNOLOGIES INTERNATIONAL, INC. (together with its successors and
assigns, collectively, the "Lender"), shall, lend to INTERLIANT, INC. a
Corporation organized under the laws of the State of Delaware (the "Borrower"),
and the Borrower shall borrow from the Lender, funds to purchase (or refinance
the purchase of) the items of "Equipment" specified (and as defined in) one or
more loan schedules hereto to be entered into from time to time (each, a "Loan
Schedule"). Each Loan Schedule shall reference this Master Note and Security
Agreement (this "Agreement") and shall be deemed to incorporate therein all of
the terms and conditions hereof, unless and to the extent any provisions hereof
are expressly excluded or modified therein, and shall contain such additional
terms as the Lender and the Borrower shall, in their sole discretion, agree
upon. Each Loan Schedule, together with the terms and conditions of this
Agreement so incorporated therein, shall constitute a separate promissory note
that evidences a separate loan with respect to the Equipment specified in such
Loan Schedule. Each Loan Schedule may be assigned by the Lender and/or
reassigned by any assignee(s) thereof separate and apart from any other Loan
Schedule(s) hereunder. With respect to each Loan Schedule, the Lender or its
respective assignee(s) shall have all of the rights of the "Lender" thereunder
and with respect to the Equipment and other Collateral covered thereby, and such
rights shall be separately exercisable by the Lender or such assignee(s), as the
case may be, collectively with all of the other Loan Schedules then held by the
Lender or such assignee(s), but exclusively and independently of the rights of
the Lender or such assignee(s) with respect to any other Loan Schedule(s) not
then held by the Lender or such assignee(s).
(b) The term "Loan" as used in this Agreement shall mean any and all of
the liabilities and obligations of the Borrower under a loan evidenced by a
particular Loan Schedule, which is entered into by the Lender and the Borrower
under this Agreement with respect to the Equipment specified in such Loan
Schedule. Capitalized terms used in this Agreement and not otherwise defined
shall have the meanings ascribed to them in the relevant Loan Schedule.
2. Terms of Payment.
(a) FOR VALUE RECEIVED, the Borrower hereby promises to pay to the order
of the Lender, the "Principal Sum" set forth in each Loan Schedule, in the
"Total Number of Monthly Installments" set forth in such Loan Schedule,
consisting of the "Number of Consecutive Monthly Installments" of principal and
interest set forth in such Loan Schedule, each payable in advance, and the
"Final Payment" of principal and interest set forth in such Loan Schedule,
together with all other sums then owing thereunder, payable on the "Final
Payment Date" set forth in such Loan Schedule; the first such consecutive
monthly installment shall be in the "First Monthly Installment Amount" set forth
in such Loan Schedule and shall be due and payable on the "First Monthly
Installment Date" set forth in such Loan Schedule; the remaining consecutive
monthly installments shall each be in the "Remaining Consecutive Monthly
Installment Amount" set forth in such Loan Schedule and shall thereafter be due
and payable on the same day of each month in each year as such First Monthly
Installment Date and ending on the "Last Consecutive Monthly Installment Date"
set forth in such Loan Schedule; and the
Rev. 6/7/99
COUNTERPART NO. 2 of 2
<PAGE> 10
Final Payment and shall be due and payable on the Final Payment Date, except as
otherwise expressly provided in Sections 17(b), 17(c), 17(d) or 18(b) hereof.
(b) The installments described in Sections 2(a) and 17(a) hereof include
interest on the unpaid principal amount of the relevant Loan from time to time
outstanding, computed on the basis of a 360-day year at the "Annual Interest
Rate" set forth in the relevant Loan Schedule.
(c) The proceeds of the Loan evidenced by each Loan Schedule shall be used
solely to purchase (or refinance the purchase of) the Equipment described in
such Loan Schedule.
(d) The Borrower shall have the right to prepay any Loan upon payment of
the present value of all Monthly Installments, and the Final Payment, calculated
by discounting at the rate of six percent (6%) per annum, compounded monthly, or
upon the payment of such other amount as may be set forth in the applicable Loan
Schedule.
(e) Whenever any installment or other amount payable to the Lender by the
Borrower hereunder is not paid when due, the Borrower agrees to pay to the
Lender, on demand, as liquidated damages and not as a penalty: (i) a late charge
on such overdue amounts calculated at the rate of one and a half (1 1/2) percent
a month, or the maximum amount permitted under applicable law, whichever is
less, from the date such payment is due until the date such payment is made in
full to the Lender; and (ii) in addition, with respect to overdue installment
payments only, an administrative fee equal to five cents ($.05) for each one
dollar ($1.00) of such delayed installment payment overdue for more than twenty
(20) days, or the maximum amount permitted under applicable law, whichever is
less. The Borrower agrees to also reimburse the Lender on demand for any and all
reasonable costs and expenses (including the Lender's reasonable attorneys' fees
and disbursements) arising out of or caused by this Agreement or any breach by
the Borrower hereunder, including (without limitation) any enforcement by the
Lender of its rights and remedies hereunder.
(f) All payments by the Borrower on account of principal, interest or fees
hereunder shall be made in lawful money of the United States of America, in
immediately available funds.
3. Grant of Security Interest. The Borrower hereby pledges, assigns and
grants to the Lender a continuing first priority security interest in and lien
on the following properties, assets and rights (collectively, the "Collateral"):
(a) the Equipment as set forth (and defined) in each Loan Schedule hereunder,
together with all warranties thereon and all additions, improvements,
accessions, replacements and substitutions thereto and therefor, whether now
owned or hereafter acquired, and all proceeds thereof; (b) the proceeds of any
insurance payable to the Borrower with respect to the Equipment; and (c) all of
the "Other Personal Property," if any, described in any Loan Schedule hereunder
and all proceeds thereof. In addition, all other property of the Borrower now or
hereafter pledged to or held by the Lender to secure any Obligations (as
hereinafter defined), whether under this Agreement, any Loan Schedule or
otherwise agreed to in writing, and all property now or hereafter leased by the
Lender to the Borrower, shall also serve as collateral security for the full
payment and performance of the Obligations.
4. Obligations Secured. The Collateral hereunder constitutes and will constitute
continuing security for the full payment, performance and observance by the
Borrower of the following obligations (collectively, the "Obligations"):
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(a) "Liabilities," which shall mean all of the indebtedness
evidenced by this Agreement and each Loan Schedule hereunder together with any
Lease Agreement(s) between Lender and Borrower (and any Schedules thereunder),
and all liabilities and obligations of any kind of the Borrower to the Lender
arising out of or relating thereto, whether (i) for the Lender's own account,
(ii) acquired directly or indirectly by the Lender from the Borrower, (iii)
absolute or contingent, joint or several, secured or unsecured, liquidated or
unliquidated, due or not due, contractual or tortious, now existing or hereafter
arising, or (iv) incurred by the Borrower as principal, surety, endorser,
guarantor, borrower, lessee or otherwise, and including (without limitation) all
reasonable expenses and attorneys' fees incurred by the Lender in connection
with any such indebtedness, liabilities or obligations or any of the Collateral
(including any sale or other disposition of the Collateral);
(b) the prompt payment, when due, of all present and future
obligations and indebtedness of the Borrower to the Lender under this Agreement
and/or any Loan Schedule, as the same may hereafter be amended or modified, and
under any other agreement or instrument executed by the Borrower in favor of the
Lender, whether direct or indirect, absolute or contingent; and
(c) the strict performance and observance by the Borrower of all
material warranties, covenants and agreements contained in this Agreement or any
Loan Schedule and any instrument or other agreement delivered by the Borrower to
the Lender.
5. Borrower Selected Equipment; Warranty Disclaimer. THE BORROWER
REPRESENTS AND ACKNOWLEDGES THAT IT HAS SELECTED BOTH THE EQUIPMENT AND THE
VENDOR OF THE EQUIPMENT (THE "VENDOR") AND THAT TO THE BEST OF ITS KNOWLEDGE THE
EQUIPMENT SUITS THE BORROWER'S PARTICULAR NEEDS. THE LENDER MAKES NO
REPRESENTATIONS OR WARRANTIES OF ANY KIND OR NATURE DIRECTLY OR INDIRECTLY,
EXPRESS OR IMPLIED, AS TO THE EQUIPMENT OR ANY OTHER MATTER WHATSOEVER,
INCLUDING WITHOUT LIMITATION, TITLE TO THE EQUIPMENT OR THE EQUIPMENT'S
CONDITION, THE SUITABILITY OF THE EQUIPMENT, ITS DURABILITY, CAPACITY,
OPERATION, PERFORMANCE, DESIGN, MATERIALS, WORKMANSHIP AND/OR QUALITY,
MERCHANTABILITY OR FITNESS FOR ANY PARTICULAR PURPOSE. THE BORROWER AGREES TO
LOOK SOLELY TO THE MANUFACTURER, VENDOR, MAINTENANCE PROVIDER OR CARRIER OF THE
EQUIPMENT FOR ANY CLAIM ARISING FROM ANY DEFECT, BREACH OF WARRANTY, FAILURE OR
DELAY IN DELIVERY, MISDELIVERY OR INABILITY TO USE THE EQUIPMENT FOR ANY REASON
WHATSOEVER, AND THE BORROWER'S OBLIGATIONS TO THE LENDER HEREUNDER SHALL NOT IN
ANY MANNER BE AFFECTED THEREBY. EXCEPT IN THE EVENT OF LENDER'S WILLFUL
MISCONDUCT, THE LENDER SHALL NOT BE LIABLE FOR ANY LOSS, DAMAGE, INJURY OR
EXPENSE CAUSED DIRECTLY OR INDIRECTLY BY ANY ITEM OF EQUIPMENT, THE USE,
MAINTENANCE, REPAIR, DEFECT OR SERVICING THEREOF, BY ANY DELAY OR FAILURE TO
PROVIDE SAME, BY ANY INTERRUPTION OF SERVICE OR LOSS OF SERVICE OR LOSS OF USE,
OR FAILURE TO PROVIDE SAME, OR FOR ANY LOSS OF BUSINESS HOWEVER CAUSED. NO
REPRESENTATION OR WARRANTY AS TO THE EQUIPMENT OR ANY OTHER MATTER BY THE VENDOR
OF THE EQUIPMENT SHALL BE BINDING ON THE LENDER, NOR SHALL THE BREACH OF SUCH
RELIEVE THE BORROWER
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OF, OR IN ANY WAY AFFECT, ANY OF THE BORROWER'S OBLIGATIONS TO THE LENDER AS SET
FORTH HEREIN.
6. Representations and Warranties. The Borrower represents, warrants,
covenants and agrees that:
(a) If the Borrower is a corporation or a partnership, it is duly
organized, existing and in good standing under the laws of its state of
incorporation, and to the best of its knowledge is duly qualified and in good
standing under the laws of each jurisdiction where the character of its
properties or the transaction of its business makes such qualification necessary
and has full power to own its properties and assets and to carry on its business
as now being conducted.
(b) The Borrower has full power and authority to execute, deliver
and perform this Agreement and each Loan Schedule, which has been duly
authorized by all necessary and proper corporate or partnership action. No
consent of stockholders, if any, or of any public authority is required as a
condition to the validity of this Agreement and each Loan Schedule. The making
and performance by the Borrower of this Agreement and each Loan Schedule will
not violate any provision of law and will not conflict with or result in a
breach of any order, writ, injunction or decree of any court or government
instrumentality, or its charter or by-laws or partnership agreement, if any, or
create a default under any agreement, note or indenture to which it is a party
or by which it is bound or to which any of its property is subject, or result in
the imposition of any lien, charge or encumbrance of any nature whatsoever upon
any of its properties or assets, except for the liens created under this
Agreement or any Loan Schedule.
(c) This Agreement and each Loan Schedule have been duly executed
and delivered, and constitutes the valid and legally binding obligation of the
Borrower, enforceable in accordance with its terms.
(d) The Borrower has good title to and is the lawful owner of the
Collateral free from all claims, liens, encumbrances, charges or security
interests whatsoever, except for the liens granted by this Note. For purposes of
this Agreement, Permitted Liens shall mean the liens granted by this Agreement
or any Loan Schedule.
(e) The Collateral is and will be kept at the location(s) set forth
in the relevant Loan Schedule hereto.
(f) To the best of its knowledge, the provisions of this Agreement
and each Loan Schedule create a valid and perfected first priority security
interest in the Collateral, enforceable in accordance with their respective
terms, subject to no prior or equal lien, charge, encumbrance or security
interest, upon the filing of appropriate Uniform Commercial Code financing
statements or equivalent instruments, and notation and issuance of appropriate
certificates of title, with respect to the Collateral. Uniform Commercial Code
financing statements or equivalent instruments and certificates of title with
the Lender's security interest duly noted thereon, with respect to the
Collateral in a form provided by Lender, have been executed by the Borrower and
delivered to the Lender for filing at the appropriate offices.
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(g) There are no judgments outstanding against the Borrower and
there are no material actions or proceedings before any court or administrative
agency pending or, to the knowledge of the Borrower, threatened against the
Borrower which, if determined adversely to the Borrower, would affect the
Collateral.
(h) The Borrower's principal office and place of business where it
maintains its records concerning the Collateral is at its address stated on the
relevant Loan Schedule. The Borrower has no other office or place of business,
except as indicated on the relevant Loan Schedule.
7. Insurance. The Borrower shall keep and maintain the Equipment and other
Collateral insured with all risk insurance, for not less than the replacement
cost thereof. The Borrower shall also provide, for the benefit of the Lender,
public liability insurance (both personal injury and property damage) covering
the Equipment and other Collateral. The amount of any such insurance shall be
sufficient so that neither the Borrower nor the Lender will be considered a
co-insurer. Such insurance shall be in form, issued by insurance companies and
in amounts reasonably satisfactory to the Lender. Each insurer shall agree, by
endorsement upon the policy or policies issued by it or by independent
instrument furnished to the Lender, that such insurer give at least ten (10)
days' prior written notice of the effective date of any alteration or
cancellation of such policy and that coverage under such policy shall not be
affected by any default, misrepresentation or other breach by the Borrower or
the Lender under this Agreement or any Loan Schedule or such policy. The Lender
shall have the option but not the obligation, to pay the premiums to continue
any such canceled insurance policy in effect or to obtain like coverage. The
Borrower agrees that any payment made by the Lender pursuant to the foregoing
authorization (and interest thereon at the rate of one and a half (1 1/2)
percent a month, or if such rate shall exceed the maximum rate allowed by law,
then, at such maximum rate from the date of such payment) shall become part of
the Obligations and be secured by the Collateral. The proceeds of all insurance
payable as a result of loss or damage to any item of the Equipment, up to the
amount of the Obligations pertaining to such Equipment may be applied by Lender
to satisfy such Obligations. The Borrower hereby irrevocably appoints the Lender
as the Borrower's attorney-in-fact solely to make claim for, receive payments of
and execute and endorse all documents, checks or drafts received in payment for
loss or damage under any such insurance policy. In the event that the amount of
such payments exceeds the amount of the Obligations pertaining to such Equipment
or this Agreement, Lender shall remit such excess amount to Borrower within ten
(10) business days after receipt thereof. In all events, the Borrower shall be
liable for any loss, damage, expense or costs suffered or incurred by the Lender
relating to or in any manner pertaining to this Agreement or any Loan Schedule,
the Collateral or the use or operation of the Collateral, provided that Borrower
shall not be liable for any loss, damage, expense or cost solely caused by
Lender's gross negligence or willful misconduct.
8. Maintenance; Loss of Collateral. The Borrower acknowledges that, in making
its decision to extend the credit evidenced by this Agreement and each Loan
Schedule to the Borrower, the Lender is depending heavily upon the realizable
value of the Collateral at all times during the term of this Agreement and each
Loan Schedule, and the Borrower hereby represents and warrants to the Lender
that the purchase price paid by the Borrower for the Collateral represents the
retail fair market value thereof. Accordingly, the Borrower agrees at all times
to maintain the Collateral in good operating condition, repair and appearance,
and protect the same from deterioration, other than normal wear and tear, keep
the Collateral in its exclusive possession and control at the location specified
in the relevant Loan Schedule and use the Collateral only in the regular course
of its business within its normal capacity, without abuse
Rev. 6/7/99
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<PAGE> 14
and in a manner contemplated by the Vendor, shall comply with all laws,
ordinances, regulations, requirements and rules with respect to the use,
maintenance and operation of the Collateral, shall not make any modification,
alteration or addition to the Collateral (other than normal operating
accessories or controls which, when added to the Collateral, shall not impair
the operation or reduce the value of the Collateral) without the prior written
consent of the Lender, and all modifications, alterations, accessories, parts,
replacements and additions to the Collateral which affect the value or operation
of the Collateral shall become part of the Collateral and be included within the
term "Collateral" as used herein. Notwithstanding anything to the contrary
contained herein, (i) Borrower shall be permitted, without the consent of
Lender, to load software and make configuration or other changes to the
Collateral as are reasonably appropriate to operate Borrower's business provided
that such alterations or additions do not adversely affect the value thereof or
the ability to operate, maintain and remove the Collateral. The alterations and
additions set forth in the immediately preceding sentence need not be removed at
the termination or expiration of this Agreement. For the purpose of assuring the
Lender that the Collateral will be properly serviced, the Borrower agrees, in
the event that the Lender so requests, to cause the Collateral to be maintained
by the Vendor (or another maintenance organization approved by the Lender in
writing) pursuant to Vendor's standard preventive maintenance contract or
comparable maintenance contract, in each case covering at least prime shift
maintenance of each item of Collateral. Except for loss, damage or destruction
arising from Lenders gross negligence or willful misconduct, the Borrower hereby
assumes the entire risk of loss, damage or destruction of the Collateral from
any and every cause whatsoever. The Borrower agrees that any such loss, damage
or destruction of the Collateral shall not relieve the Borrower of its
obligations hereunder, which obligations shall remain absolute, unconditional
and not subject to any claim, defense, set-off, counterclaim, reduction or
abatement of any kind whatsoever; provided, however, that the foregoing shall
not limit the right of the Borrower to bring a separate claim against Lender for
breach of this Agreement or any other reason. In the event of any loss, damage
or destruction of any item of Collateral, the Borrower shall give the Lender
prompt written notice thereof and shall, at the Borrowers sole expense (except
to the extent of any proceeds of insurance maintained by the Borrower which
shall have been received by the Borrower as a result of such loss, damage or
destruction) and at the Lender's sole option, either (a) repair such item,
returning it to its previous condition, unless damaged beyond repair, or (b)
replace such item with a like item acceptable to the Lender, in good condition
and of equivalent value, which shall be included within the term "Collateral" as
used herein.
9. Books and Records. The Borrower shall give the Lender full and free
access to the Collateral during normal business hours and with at least three
business days notice and to all books, correspondence and records of the
Borrower with respect thereto, permit the Lender and its representatives to
examine the same and to make copies and extracts therefrom, Lender shall keep
and maintain the confidentiality of all such information in a manner at least as
restrictive as the manner in which it maintains its own most confidential
information. Notice shall not be required if at such time Borrower is in default
under this Agreement.
10. Taxes and Encumbrances. The Borrower shall promptly pay and discharge
or cause to be paid and discharged all its obligations and liabilities,
including (without limitation) all taxes, assessments and governmental charges
upon it and its income or properties, when due unless and to the extent only
that the same shall be contested in good faith and by appropriate proceedings
and then only to the extent that a bond is filed in cases where the filing of a
bond is necessary to avoid the creation of a lien against any of the Collateral
or any of its other assets. Other than Permitted Liens, the Borrower
Rev. 6/7/99
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<PAGE> 15
covenants and agrees to keep the Collateral free and clear of all levies, liens,
claims, security interests and encumbrances (including, without limitation, any
lease or sublease thereof) and to promptly pay all charges, taxes and fees which
may now or hereafter be imposed upon the ownership, sale, purchase, possession
or use of the Collateral. In addition, the Borrower shall timely file all tax
returns required in connection with the use, operation or possession of the
Collateral, and shall upon written request promptly furnish copies thereof to
the Lender.
11. Corporate Existence. If the Borrower is a corporation or partnership,
the Borrower shall do, or cause to be done, all things necessary to preserve and
keep in full force and effect its corporate or partnership existence and all
franchises, rights and privileges necessary for the proper conduct of its
business, and continue to engage in the business of the same type as now
conducted by it.
12. Notice of Events of Default The Borrower shall give notice in writing
promptly to the Lender of the occurrence of any event which constitutes, or
which with notice or lapse of time or both would constitute, an Event of Default
(as hereinafter defined).
13. Delivery of Financial Data.
(a) So long as any obligations remain unsatisfied under this Agreement,
Borrower agrees to deliver to Lender or any assignee and any successor assignee
a copy of Borrower's monthly unaudited financial statements until such time as a
public offering is completed, and the annual financial budget for the upcoming
year as soon as available and as it may be adjusted during the year. Upon
completion of such public offering Borrower shall furnish quarterly financial
statements to Lender; provided however, that if any creditor of Lessee is
furnished monthly financial statements, (including but not limited to budgets),
Borrower shall furnish such monthly financial statements to Lender. Borrower
shall also furnish, as soon as available and in any event within ninety (90)
days after the last day of Borrower's fiscal year, a copy of Borrower's annual
audited statements and consolidating and consolidated balance sheet, if any, as
of the end of such fiscal year, accompanied by the opinion of an independent
certified public accounting firm of recognized standing. The Borrower shall
furnish such other financial information as may be reasonably requested by
Lender, including but not limited to any material changes in budgets or
financial reports furnished to the Borrower's Board of Directors or
Shareholders.
(b) The Borrower acknowledges and agrees that all credit applications,
statements, financial reports and other information prepared by (including any
information prepared by the Borrower's CPA's, as hereafter defined) and
submitted by it to the Lender are material inducements to the execution by the
Lender of this Agreement and each Loan Schedule and the financing provided
hereunder. The Borrower warrants that to its knowledge all such credit
applications, statements, reports and other information are and all information
hereafter prepared by (including any information prepared by the Borrower's
CPA's, as hereafter defined) and furnished by the Borrower to the Lender will
be, true and correct in all material respects as of the date submitted, that no
such credit application, statement, report or other information contains any
material untrue or misleading information or omits any material fact necessary
to make such application, statement, report or other information not misleading
and that the Borrower is in no way affiliated with any Vendor of any of the
Equipment. The Borrower agrees, upon written request by Lender, to use best
efforts to obtain for the Lender such estoppel certificates, landlord's waivers
or other similar documents as the Lender may reasonably request.
Rev. 6/7/99
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<PAGE> 16
14. Principal Office. Except for movement to another facility operated by
Borrower within the same taxing and Uniform Commercial Code filing jurisdiction,
the Borrower shall not change its principal office or the place where it
maintains its records pertaining to the Collateral, as specified in Sections
6(d) and 6(g) hereof, without giving the Lender at least thirty (30) days' prior
written notice thereof.
15.Location of Collateral; Inspection; Labels. The Borrower shall not
remove or permit the removal of the Collateral from its present location as set
forth on the relevant Loan Schedule, without the prior written consent of the
Lender which consent shall not be unreasonably withheld or delayed. Upon at
least three business days' prior notice, the Lender and its representatives
shall have the right to enter the Borrower's premises from time to time during
business hours to inspect, observe or, after the occurrence and during the
continuance of an Event of Default, remove the Collateral, and to confirm its
existence, condition and proper maintenance or otherwise protect the Lender's
interest therein. The Borrower shall comply with all material laws, ordinances,
regulations or requirements of any governmental authority, official, board or
department relating to the Collateral's installation, possession, use or
maintenance. The Collateral shall remain personal property regardless of its
affixation to any realty. Upon the Lender's written request, the Borrower shall
affix and keep in a prominent place on each item of Collateral labels, plates or
other markings indicating the Lender's security interest in the Collateral.
16. Option to Perform Obligations of the Borrower in Respect of the
Collateral. If the Borrower fails or refuses, after any applicable grace period
and notice to the Borrower, to make any payment, perform any covenant or
obligation, or take any other action which the Borrower is obligated hereunder
to perform, observe, take or do hereunder, then the Lender may, at its option,
without releasing the Borrower from any obligation or covenant hereof, perform.
observe, take or do the same in such manner and to such extent as the Lender may
deem necessary or appropriate to protect any of the Collateral and its rights
hereunder, including (without limitation) obtaining insurance and the payment of
any taxes and the payment of any sums necessary to discharge liens or security
interests at any time levied or placed on the Collateral. The Borrower agrees
that any payment or expense incurred by the Lender pursuant to the foregoing
authorization (and interest thereon at the rate of one and a half (1 1/2)
percent a month, or if such rate shall exceed the maximum rate allowed by law,
then, at such maximum rate from the date of incurring of any such expense is
incurred) shall become part of the Obligations and be secured by the Collateral
set forth in this Agreement and each Loan Schedule.
17. Final Payment Alternatives (a) Notwithstanding anything to the
contrary set forth in Section 2(a) of this Agreement, if at least 90 days prior
to the Final Payment Date under a Loan Schedule, the Borrower gives the Lender
written notice requesting that the Lender extend and finance the repayment of
the relevant Final Payment over an additional 12-month term commencing on such
Final Payment Date (the "Refinancing Request"), and provided that no Event of
Default (as hereinafter defined) and no event or circumstance that, with the
giving of notice or the passage of time, or both, would constitute an Event of
Default, including (without limitation) the nonpayment or nonperformance of any
outstanding liability or obligation under this Agreement (each, a "Default"),
shall have occurred and be continuing as of (i) the date such Refinancing
Request is given, or (ii) the relevant Final Payment Date, then such Final
Payment shall not be due and payable on such Final Payment Date but instead
shall be payable in 12 equal monthly installments of principal and interest,
each in the "Refinanced Monthly Installment Amount" set forth in
Rev. 6/7/99
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<PAGE> 17
the relevant Loan Schedule and due and payable on the same day of each month as
such Final Payment Date, commencing on such Final Payment Date.
(b) Notwithstanding anything to the contrary set forth in Section 2(a) of
this Agreement, so long as no Default or Event of Default has occurred and is
continuing on the Final Payment Date under a Loan Schedule and if, at least 90
days prior to the relevant Final Payment Date, the Borrower notifies the Lender
in writing (the "Return Option Exercise Notice") of the Borrower's desire to
transfer title to the related Equipment to the Lender in partial satisfaction of
the Borrower's obligation to pay the relevant Final Payment (the "Return
Option"), the Borrower shall receive a credit in an amount equal to the "Return
Option Credit" set forth in such Loan Schedule against such Final Payment by
unconditionally and irrevocably transferring and assigning to the Lender or its
designee on such Final Payment Date all of the Borrower's right, title and
interest in and to the related Equipment; provided, however, that the Borrower
pays the entire remaining "Return Option Balance Amount" set forth in such Loan
Schedule to the Lender on the relevant Final Payment Date. If a Return Option
Exercise Notice is duly given as provided above, the relevant Return Option
shall be exercised by the Borrower delivering each of the following to the
Lender, at the Borrower's sole cost and expense, on or before the relevant Final
Payment Date: (i) a duly executed bill of sale in favor of the Lender with
respect to all of the Equipment covered by the relevant Loan Schedule, in form
and substance reasonably satisfactory to the Lender and its counsel; (ii)
payment in full of the relevant Return Option Balance Amount; and (iii) the
relevant Equipment, at a location up to a maximum distance of 500 miles within
the continental United States designated by the Lender, in the same operating
order, repair, condition and appearance as on the date hereof, reasonable wear
and tear only excepted, and with all engineering and safety changes prescribed
by the manufacturer or approved maintenance organization to accept such
Equipment under contract maintenance at its then standard rates. The Borrower
shall promptly pay any and all costs of repair, replacement, deinstallation,
packing, shipping and delivery of the relevant Equipment to the Lender upon the
Borrower's exercise of such Return Option. If the Borrower duly satisfies all of
the terms and conditions of this Section 17(b), the Borrower shall have fully
satisfied all of its obligations under the related Loan Schedule.
(c) Notwithstanding anything to the contrary set forth in Section 2(a) of
this Agreement, if the Borrower believes that the "Fair Market Value" (as
hereinafter defined) of the Equipment covered by a Loan Schedule as of the
relevant Final Payment Date will be less than the amount of the Final Payment
under such Loan Schedule, the Borrower may notify the Lender in writing at least
90 days prior to such Final Payment Date of the Borrower's election to have the
amount of such Final Payment adjusted (the "Final Payment Adjustment Option
Notice") to an amount equal to the greater of (i) Fair Market Value of the
relevant Equipment as of such Final Payment Date, or (ii) the "Adjusted Final
Payment" set forth in the such Loan Schedule. If such Final Payment Adjustment
Option Notice is so given, and so long as no Default or Event of Default has
occurred and is continuing as of (A) the date such Final Payment Adjustment
Option Notice is given, or (B) the relevant Final Payment Date, then unless the
amount of such Adjusted Final Payment is greater than the amount of such Final
Payment, such Final Payment shall automatically be deemed changed to such
Adjusted Final Payment and the Borrower irrevocably and unconditionally agrees
to pay such Adjusted Final Payment on the relevant Final Payment Date in lieu of
such Final Payment. "Fair Market Value" of any Equipment shall mean the amount
as of the relevant Final Payment Dale that would obtain for such Equipment in a
retail arms'-length transaction between an informed and willing buyer in
possession under no compulsion to buy and an informed and willing seller under
no compulsion to sell. The Lender shall initially determine the Fair Market
Value of any Equipment by notifying the Borrower thereof in writing at least 75
days prior to the relevant Final
Rev. 6/7/99
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<PAGE> 18
Payment Date. If the Borrower does not accept such determination of Fair Market
Value by the Lender, the Borrower shall notify the Lender of such non-acceptance
in writing not less than 60 days prior to such Final Payment Date. If the
Borrower does not so notify the Lender of its non-acceptance of the Lender's
determination within such period, then the Fair Market Value of such Equipment
as initially determined by the Lender shall be conclusive. If the Borrower does
so notify the Lender of such non-acceptance within such period, then the Fair
Market Value of such Equipment shall conclusively be established not less than
30 days prior to the relevant Final Payment Date by an independent appraiser
selected by the Lender and reasonably acceptable to the Borrower. All costs for
such appraiser shall be paid by the Borrower within 10 days after its receipt of
an invoice therefor.
18. Events of Default; Remedies. (a) If any one of the following events
(each, an "Event of Default") shall occur, then to the extent permitted by
applicable law, the Lender shall have the right to exercise any one or more of
the remedies set forth in Section 18(b) hereof: (i) the Borrower fails to make
any payment when due hereunder and such failure continues for a period of five
business days; or (ii) Borrower fails to observe or perform (A) any other
agreement or obligation to be observed or performed hereunder or under any Loan
Schedule or other agreement, document or instrument delivered to the Lender by
or on behalf of an Obligor or otherwise relating to any of the Obligations
(collectively, the "Other Documents") and unless expressly set forth in this
Agreement or any Loan Schedule, such failure continues uncured for a period of
thirty (30) days following notice by Lender, or (B) any other obligation of
Borrower to the Lender and the failure to observe or perform shall continue
uncured for thirty (30) days following notice by Lender; provided however that
such thirty day period shall be extended if Borrower commences, in a reasonably
diligent manner to cure such default if such default cannot be cured within such
thirty days; provided further that such cure period shall not be extended beyond
seventy-five days; or (iii) any representation or warranty made by or on behalf
of Borrower in this Agreement or any Loan Schedule or in any of the Other
Documents shall at any time prove to have been incorrect or untrue in any
material respect when made; or (iv) the Borrower's failure to obtain or maintain
any insurance required by the Lender hereunder and such failure continues
uncured for a period of ten (10) days following notice by Lender; or (v) a
default occurs in the payment of any indebtedness in an amount in excess of
$100,000 owed by Borrower to any individual or entity other than the Lender and
such default continues beyond any applicable cure period; or (vi) a default
occurs in the performance or observance of the terms of any agreement, document
or instrument pursuant to which such indebtedness was created, secured or
guaranteed, the effect of which default is to cause or permit the holder of any
such indebtedness to cause the same to be due prior to its stated maturity
(whether or not such default is waived by the holder thereof); or (vii) Borrower
fails (after ten (10) days prior notice thereof) to pay, withhold, collect or
remit when asserted or due any tax, assessment or other sum payable with respect
to the Collateral or any security for any of the Obligations (including, without
limitation, any premium on any insurance policy with respect to any of the
Collateral or any security for any of the Obligations, or any insurance policy
assigned to the Lender as security for any of the Obligations), or (viii) a
judgment is entered against the Borrower in an amount in excess of $25,000 and
such judgment is not satisfied, dismissed, bonded or stayed within 30 days, or
any attachment, levy or execution is made against any Collateral; or (ix)
Borrower enters into any transaction which adversely affects a significant
portion of the business value of Borrower and which materially affects the
ability of the Borrower to repay the Borrower's obligations under the Agreement;
or (x) Borrower fails (or Borrower admits in writing its inability) to generally
pay its debts as they become due or the insolvency or business failure of
Borrower; or (xi) the filing of an application for appointment of a trustee,
custodian or receiver for Borrower or of any part of Borrower's property (and in
the case of an involuntary filing against the Borrower, such filing is not
dismissed within
Rev. 6/7/99
-10-
<PAGE> 19
60 days); or (xii) the filing of a petition in bankruptcy by or against
Borrower, or the commencement by or against Borrower of any proceeding under any
bankruptcy or insolvency law or statute, or any law or statute relating to the
relief of debtors or arrangement of debt, readjustment of indebtedness,
reorganization, receivership or composition, or the extension of indebtedness
(and in the case of an involuntary filing against the Borrower, such filing is
not dismissed within 60 days); or (xiii) a material adverse change in the
condition or affairs (financial or otherwise) of Borrower or any other event or
circumstance occurs that materially impairs the prospects of full and prompt
payment or performance by Borrower of any of its Obligations; or (xiv) Borrower
attempts to remove, sell, transfer, encumber, sublet or part with possession of
the Equipment or any item thereof, except as expressly permitted herein; no cure
period shall apply to this Section 18 (xiv).
(b) Upon the occurrence of an Event of Default, which default has
not been cured within the applicable cure period, at the Lender's sole option,
all or any part of the entire unpaid total amount of the Obligations then owed
to the Lender for the balance of the term thereof shall be at once due and
payable and the Lender may, enter upon the premises where any or all of the
Collateral securing such Obligations is located, take possession of and remove
same, and exercise any one or more of the following rights and remedies, without
liability to the Borrower therefor and without affecting the Borrower's
obligations hereunder: (i) sell, lease or otherwise dispose of any or all of
such Collateral or any part thereof at one or more public or private sales,
leases or other dispositions, at wholesale or retail, for such consideration, on
such terms, for cash or on credit, as the Lender may deem advisable, and the
Lender may immediately, without demand of performance and without intention of
notice to sell or of the time or place of sale or of redemption or of
advertisement or other notice or demand whatsoever to the Borrower, all of which
are hereby expressly waived (if notice of any sale or other disposition is
required by law to be given, the Borrower hereby agrees that a notice sent at
least five (5) days before the time of any intended public sale or of the time
after which any private sale or other disposition of such Collateral is to be
made, shall be reasonable notice of such sale or other disposition); or (ii) to
the extent permitted by law, retain such Collateral or any part thereof,
crediting the Borrower with the reasonable fair market or rental value thereof
for the balance of the term of the related Loan Schedule; and/or (iii) require
the Borrower to assemble such Collateral at the Borrower's sole expense, for the
Lender's benefit, at a place designated by the Lender; and/or (iv) pursue any
other remedy granted by any existing or future document executed by the Borrower
or by law, including, without limitation, the rights and remedies of a secured
party under the Uniform Commercial Code as enacted in any jurisdiction in which
any of such Collateral may be located. At any public sale, the Lender may be the
purchaser of all or any part of such Collateral, free from any right of
redemption on the part of the Borrower, which right is hereby waived and
released. The Borrower agrees to pay all of the Lender's reasonable expenses,
including but not limited to the costs of repossessing, storing, repairing and
preparing such Collateral for sale or lease, any commissions payable in
connection with any such sale or lease, and reasonable attorney's fees and
disbursements, if an attorney shall be consulted. The net proceeds realized from
any such sale, lease or other disposition or the exercise of any other remedy,
after deducting therefrom all related expenses, shall be applied toward payment
of the unpaid Obligations due and to become due to the Lender hereunder, the
Borrower to remain personally liable for any deficiency. The Lender's recovery
shall in no event exceed the maximum amount permitted by law. If any of such
Collateral is leased by the Lender to a bona fide third party, the present
value of such lease receivable discounted at an interest rate of 12% per annum
shall be credited to the Borrower's liability to the Lender after deducting all
expenses associated with the lease of such Collateral and the Borrower shall
remain liable for any deficiency thereof. It is understood that facility of
repossession in an Event of Default is a basis for the financial accommodation
reflected by this
Rev. 6/7/99
-11-
<PAGE> 20
Agreement and each Loan Schedule. Any late charges payable to the Lender under
Section 2(e) hereof shall be payable in addition to all amounts payable by the
Lender as a result of exercise of any of the remedies herein provided. The
Borrower agrees to also reimburse the Lender for any reasonable expenses
(including the Lender's reasonable attorneys' fees and expenses) arising out of
or caused by Borrower's breach of this Agreement or any Loan Schedule.
Notwithstanding anything to the contrary contained herein, if any one or more
Loan Schedules are assigned by the Lender to one or more assignees, the
Collateral securing the Obligations under each Loan Schedule shall be limited to
the Collateral securing the Obligations under each Loan Schedule then held by
the Lender or such assignee, as the case may be.
19. Power of Attorney. The Borrower authorizes the Lender and does hereby make,
constitute and appoint the Lender and any officer, employee or agent of the
Lender with full power of substitution, as the Borrower's true and lawful
attorney-in-fact with power, in its own name or in the name of the Borrower:
upon the occurrence and during the continuance of an Event of Default, solely
(i) to endorse any notes, checks, drafts, money orders, or other instruments of
payment (including payments under or in respect of any policy of insurance) in
respect of the Collateral that may come into possession of the Lender, (ii) to
sign and endorse any documents relating to the Collateral, (iii) to pay or
discharge taxes, liens, security interests or other encumbrances at any time
levied or placed on or threatened against the Collateral, and/or (iv) to grant,
collect, receipt for, compromise, settle and sue for monies due in respect of
the Collateral; and (v) generally to do, at the Lender's option, all acts and
things that the Lender reasonably deems necessary or desirable to protect,
preserve and realize upon the Collateral and the Lender's security interests
therein, or (vi) in order to otherwise effectuate the intents of this Agreement
and each Loan Schedule, in each case as fully and effectually as the Borrower
might or could itself do; and the Borrower hereby ratifies all that such
attorney-in-fact shall lawfully do or cause to be done by virtue hereof. THIS
POWER OF ATTORNEY IS COUPLED WITH AN INTEREST ANT) SHALL BE IRREVOCABLE FOR AS
LONG AS ANY OF THE OBLIGATIONS SHALL BE OUTSTANDING. The Borrower agrees that
any expense incurred by the Lender pursuant to the foregoing authorization, and
interest thereon at the rate of one and a half (1 1/2) percent a month, or if
such rate shall exceed the maximum rate allowed by law, then, at such maximum
rate from the date of incurring any such expense, shall become part of the
Obligations and be secured by the Collateral.
20. Assignment, Etc. The Borrower shall not assign, pledge, mortgage, lease,
transfer, encumber or otherwise dispose of any of its rights in the Collateral
or any part thereof, nor permit its use by anyone other than its regular
employees or customers without the Lender's prior written consent, which shall
not be unreasonably withheld or delayed, except that Borrower may assign,
pledge, mortgage, lease, transfer, encumber or otherwise dispose of its rights
in the Collateral to its parent or any subsidiary corporation or to a
corporation which shall have acquired all or substantially all of the property
of Borrower by merger, consolidation or purchase. No permitted assignment or
sublease shall relieve Borrower of any of its obligations hereunder. Any such
purported transfer, assignment or other action without the Lender's prior
written consent shall be void. The Lender may, upon notice to (but without the
consent of) the Borrower, transfer or assign this Agreement and each Loan
Schedule or any interest herein and may mortgage, pledge, encumber or transfer
any of its rights or interest in and to the Collateral or any part thereof and,
without limitation, each assignee, transferee, pledgee and mortgagee (which may
include any affiliate of the Lender) shall have the right to further transfer or
assign its interest. Each such assignee, transferee, pledgee and mortgagee shall
have all of the rights (but none of the obligations) of the Lender under this
Agreement and each Loan Schedule. The Borrower hereby acknowledges notice of the
Lender's intended assignment of this Agreement and each Loan Schedule
Rev. 6/7/99
-12-
<PAGE> 21
and, upon such assignment, the Borrower agrees not to assert against any such
assignees, transferees, pledgees and mortgagees any defense, claim,
counterclaim, recoupment or set-off that the Borrower may have against the
Lender, whether arising under this Agreement or any Loan Schedule or otherwise.
Any assignee, transferee, pledgee or mortgagee of the Lender's rights under this
Agreement or any Loan Schedule shall be considered a third party beneficiary of
all of the Borrower's representations, warranties and obligations hereunder to
the Lender. The Borrower agrees (a) in connection with any such transfer or
assignment, to provide such instruments, documents, acknowledgments and further
assurances as the Lender or any assignee, transferee, mortgagee or pledgee may
deem necessary or advisable to effectuate the intents of this Agreement or any
Loan Schedule or any such transfer or assignment, with respect to such matters
as the Agreement, any Loan Schedule, the Collateral, the Borrower's obligations
to such assignee, transferee, mortgagee or pledgee and such other matters as may
be reasonably requested, and (b) that after receipt by the Borrower of written
notice of assignment from the Lender or from the Lender's assignee, transferee,
pledgee or mortgagee, all principal, interest and other amounts which are then
and thereafter become due under this Agreement or any Loan Schedule shall be
paid to such assignee, transferee, pledgee or mortgagee, at the place of payment
designated in such notice. This Agreement and each Loan Schedule shall be
binding upon the Borrower and its successors and shall inure to the benefit of
the Lender and its successors and assigns.
21. No Waiver. No failure on the part of the Lender to exercise, and no
delay in exercising any right, remedy or power hereunder shall operate as a
waiver thereof, nor shall any single or partial exercise by the Lender of any
right, remedy or power hereunder preclude any other or future exercise of any
other right, remedy or power. No course of dealing between the Borrower and the
Lender nor any delay or omission on the part of the Lender shall operate as a
waiver of any rights of the Lender. Each and every right, remedy or power hereby
granted to the Lender or allowed if by law or other agreement shall be
cumulative and not exclusive of any other, and may be exercised by the Lender
from time to time. Waiver of any particular Event of Default shall not be deemed
to be a waiver of any other or subsequent Event of Default.
22. Further Assurances; Filing. The Borrower from time to time, at its
sole expense, will promptly execute and deliver all further instruments,
documents and assurances, and take all further action, that may be necessary or
desirable, or that the Lender may reasonably request, and hereby authorizes the
Lender to take all action (including the filing of any financing statements,
continuation statements or amendments thereto without the signature of the
Borrower) as the Lender may deem reasonably necessary, proper or desirable in
order to perfect and protect any security interest granted or purported to be
granted hereby or to enable the Lender to exercise and enforce its rights and
remedies hereunder with respect to any of the Collateral. The Borrower hereby
authorizes the Lender to file one or more financing or continuation statements,
and amendments thereto, relative to all or any part of the Collateral without
the signature of the Borrower where permitted by law. A carbon, photographic or
other reproduction of this Agreement or any Loan Schedule or any financing
statement covering the Collateral or any part thereof shall be sufficient as a
financing statement where permitted by law. The Borrower agrees to pay the
Lender the actual fees for such filing, recording or stamp fees or taxes arising
from the filing or recording of any such instrument or statement, Lender shall
provide Borrower with copies of each filing which has been made hereunder.
23. Indemnity and Expenses. Except if such occur as a result of Lender's
gross negligence or willful misconduct, the Borrower shall and does hereby
indemnify and save the Lender, its directors,
Rev. 6/7/99
-13-
<PAGE> 22
officers, employees, agents, attorneys, servants, successors and assigns,
harmless from any and all liabilities (including, without limitation,
negligence, tort and strict liability), damages, expenses, claims, actions,
proceedings, judgments, settlements, losses, liens and obligations (each, an
"Indemnified Claim"), including (without limitation) attorneys' fees and
expenses, arising out of the ordering, purchase, delivery, rejection,
non-delivery, ownership, selection, possession, leasing, renting, financing,
operation (regardless of where, how and by whom operated), control, use,
condition (including but not limited to latent and other defects, whether or not
discoverable by the Borrower), maintenance, delivery, transportation, storage,
repair, furnishing of specifications with respect to, and the return or other
disposition of, the Equipment or any other Collateral, or, in the event that the
Borrower shall be in default hereunder, arising out of the condition of any item
of Equipment or any other Collateral sold or disposed of after use by the
Borrower, including (without limitation) claims for injury to or death of
persons and for damage to property. The indemnities and obligations herein
provided shall continue in full force and effect notwithstanding the expiration,
termination or cancellation of this Agreement or any Loan Schedule for any
reason whatsoever and irrespective of whether the Borrower ever accepts the
Equipment or any other Collateral. The Lender shall give the Borrower prompt
written notice of any Indemnified Claim and, at the Lender's sole option,
Borrower shall defend the Lender against any Indemnified Claim at the Borrower's
sole expense with attorney(s) selected by the Borrower and reasonably acceptable
to Lender. The Borrower is an independent contractor and nothing contained
herein shall authorize the Borrower or any other person to operate any item of
Equipment or any other Collateral so as to incur any liability or obligation for
or on behalf of the Lender. The Borrower will upon demand pay to the Lender the
amount of any and all reasonable expenses, including the fees and disbursements
of its counsel and of any experts and agents, which the Lender may incur in
connection with (a) the exercise, enforcement or protection of any of the rights
of the Lender hereunder after the occurrence and during the continuance of an
Event of Default, or (b) the failure by the Borrower to perform or observe any
of the material provisions hereof. The foregoing amounts shall become part of
the Obligations and secured by the Collateral as set forth in this Agreement or
any Loan Schedule and the Lender may at any time apply to the payment of all
such costs and expenses all proceeds arising from the possession or disposition
of all or any portion of the Collateral.
24. Modifications, Etc. Neither this Agreement nor any Loan Schedule, nor
any provision hereof or thereof, may be changed, waived, discharged, or
terminated orally, but only by an instrument in writing signed by a duly
authorized representative of the party against whom enforcement of the change,
waiver, discharge or termination is sought.
25. Termination. Upon the non-defeasible payment in full of all
Obligations, the Lender shall execute and deliver to the Borrower all such
documents and instruments as shall be necessary to evidence termination of this
Agreement or any Loan Schedule and the security interests created hereunder.
26. Entire Agreement: Partial Invalidity. This Agreement and each Loan
Schedule constitutes the entire agreement of the Lender and the Borrower with
respect to the transactions covered hereby, and supersedes any and all prior
agreements, understandings and negotiations with respect thereto. If any
provision of this Agreement or any Loan Schedule is held to be invalid or
unenforceable, such invalidity or unenforceability shall not invalidate this
Agreement or any Loan Schedule as a whole, but this Agreement or such Loan
Schedule shall be construed as though it did not contain the particular
Rev. 6/7/99
-14-
<PAGE> 23
provision or provisions held to be invalid or unenforceable and the rights and
obligations of the parties shall be construed and enforced to such extent as
shall be permitted by law.
27. Miscellaneous. (a) Any notice or other communication to a party
hereunder shall be sufficiently given if in writing and personally delivered or
mailed to said party by certified mail, return receipt requested, at its address
set forth herein with a copy to Interliant, Inc., Attn: General Counsel, Two
Manhattanville Road, Purchase, NY 10577 or such other address as either may
designate for itself in such a notice to the other and such notice shall be
deemed to have been given when received if personally delivered or served by
overnight delivery or by mail. Whenever the sense of this Agreement or any Loan
Schedule requires, words in the singular shall be deemed to include the plural
and words in the plural shall be deemed to include the singular. If more than
one Borrower is named herein, the liability of each shall be joint and several.
The headings set forth in this Agreement or any Loan Schedule are for
convenience of reference only, and shall not be given substantive effect.
(b) To the extent that any Loan Schedule evidencing a Loan hereunder would
constitute "chattel paper," as such term is defined under the Connecticut
Uniform Commercial Code, a security interest therein may be created only through
the transfer or possession of the original of Counterpart No. 1 of such Loan
Schedule executed pursuant to this Agreement. Transfer or possession of an
original counterpart of this Agreement shall not be necessary to perfect such
security interest and no security interest in any such Loan Schedule may be
created by the transfer or possession of any other counterpart of such Loan
Schedule or by the transfer or possession of any counterpart of this Agreement.
28. Choice of Law and Venue; Waiver of Jury Trial. THIS AGREEMENT AND EACH
LOAN SCHEDULE SHALL BE CONSTRUED UNDER THE LAWS OF THE STATE OF CONNECTICUT,
WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF LAW OR CHOICE OF LAW. The Borrower
hereby agrees that all actions or proceedings arising directly or indirectly
from or in connection with this Agreement or any Loan Schedule or any of the
Collateral shall, at the Lender's sole option. be litigated only in the
Connecticut state courts or the United States District Court for the District of
Connecticut sitting in Fairfield County, Connecticut. The Borrower consents to
the jurisdiction and venue of the foregoing courts and consents that any process
or notice of motion or other application to either of such courts or a judge
thereof may be served inside or outside the State of Connecticut or the District
of Connecticut by registered mail, return receipt requested, directed to the
Borrower at its address set forth in this Agreement or any Loan Schedule (and
service so made shall be deemed complete upon receipt or by personal service, or
in such other manner as may be permissible under the rules of said courts. THE
LENDER AND THE BORROWER EACH WAIVE THE RIGHT TO TRIAL BY JURY IN ANY COURT WITH
RESPECT TO, IN CONNECTION WITH, OR ARISING OUT OF THIS AGREEMENT OR ANY LOAN
SCHEDULE, OR THE VALIDITY, PROTECTION, INTERPRETATION, COLLECTION OR ENFORCEMENT
THEREOF, OR ANY OTHER CLAIM OR DISPUTE HOWSOEVER ARISING, BETWEEN THE BORROWER
AND THE LENDER. The Borrower hereby waives the right to interpose any set-off or
counterclaim or cross-claim in any such litigation; provided, however, that
nothing in this Section 28 shall prevent the Borrower from asserting, in a
separate and independent proceeding, any claim it may have against the Lender.
Rev. 6/7/99
-15-
<PAGE> 1
Exhibit 10.26
================================================================================
AGREEMENT OF LEASE
between
PURCHASE CORPORATE PARK ASSOCIATES
Landlord,
and
COURTAULDS UNITED STATES INC.
Tenant,
Dated: August 23, 1991
PREMISES:
THE CENTRE AT PURCHASE
2 MANHATTANVILLE ROAD
PURCHASE, NEW YORK
A portion of the First Floor
================================================================================
<PAGE> 2
TABLE OF CONTENTS
Page
----
ARTICLE 1 PREMISES, TERM AND RENT ...................................... 1
ARTICLE 2 COMMENCEMENT OF TERM ......................................... 3
ARTICLE 3 TAX ESCALATION ............................................... 5
ARTICLE 4 EXPENSE ESCALATION ........................................... 10
ARTICLE 5 USE .......................................................... 17
ARTICLE 6 ALTERATIONS AND INSTALLATIONS ................................ 18
ARTICLE 7 REPAIRS ...................................................... 22
ARTICLE 8 REQUIREMENTS OF LAW .......................................... 23
ARTICLE 9 INSURANCE, LOSS, REIMBURSEMENT,
LIABILITY .................................................... 24
ARTICLE 10 LANDLORD'S LIABILITY ......................................... 27
ARTICLE 11 ASSIGNMENT, MORTGAGING, SUBLETTING,
ETC........................................................... 28
ARTICLE 12 ELECTRICITY .................................................. 33
ARTICLE 13 DAMAGE BY FIRE OR OTHER CAUSE ................................ 35
ARTICLE 14 CONDEMNATION ................................................. 37
ARTICLE 15 ACCESS TO DEMISED PREMISES; CHANGES .......................... 38
ARTICLE 16 DEFAULT ...................................................... 40
ARTICLE 17 RE-ENTRY BY LANDLORD, INJUNCTION ............................. 41
ARTICLE 18 DAMAGES ...................................................... 43
ARTICLE 19 LANDLORD'S RIGHT TO PERFORM TENANT'S
OBLIGATIONS .................................................. 45
ARTICLE 20 QUIET ENJOYMENT .............................................. 45
ARTICLE 21 SERVICES AND EQUIPMENT ....................................... 45
ARTICLE 22 DEFINITIONS .................................................. 49
(i)
<PAGE> 3
TABLE OF CONTENTS
Page
----
ARTICLE 23 INVALIDITY OF ANY PROVISION .................................. 50
ARTICLE 24 BROKERAGE .................................................... 50
ARTICLE 25 SUBORDINATION ................................................ 50
ARTICLE 26 CERTIFICATES OF LANDLORD AND TENANT .......................... 53
ARTICLE 27 LEGAL PROCEEDINGS WAIVER OF JURY TRIAL ....................... 54
ARTICLE 28 SURRENDER OF PREMISES ........................................ 55
ARTICLE 29 RULES AND REGULATIONS ........................................ 55
ARTICLE 30 CONSENTS AND APPROVALS ....................................... 56
ARTICLE 31 NOTICES ...................................................... 56
ARTICLE 32 NO WAIVER .................................................... 57
ARTICLE 33 CAPTIONS ..................................................... 58
ARTICLE 34 INABILITY TO PERFORM ......................................... 58
ARTICLE 35 NO REPRESENTATIONS BY LANDLORD ............................... 58
ARTICLE 36 NAME OF THE BUILDING PROJECT ................................. 59
ARTICLE 37 RESTRICTIONS UPON USE ........................................ 59
ARTICLE 38 INDEMNITY .................................................... 59
ARTICLE 39 SECURITY DEPOSIT ............................................. 60
ARTICLE 40 MISCELLANEOUS ................................................ 60
ARTICLE 41 COMMON AREAS AND PARKING ..................................... 61
ARTICLE 42 EXTENSION OF TERM ............................................ 64
(ii)
<PAGE> 4
TABLE OF CONTENTS
Page
----
EXHIBITS
A - Site Plan ................................................... A-1
B - Description of Land ......................................... B-1
C - First Floor Plan ............................................ C-1
D - Work Letter ................................................. D-1
D-1 - Preliminary Layout .......................................... D-3
E - HVAC Specifications ......................................... E-1
F - Cleaning Specifications ..................................... F-1
G - Rules and Regulations ....................................... G-1
(iii)
<PAGE> 5
AGREEMENT OF LEASE made as of this 23rd day of August, 1991, between
PURCHASE CORPORATE PARK ASSOCIATES, a New York partnership having an office at
625 Madison Avenue, New York, New York 10022 (hereinafter referred to as
"Landlord") and COURTAULDS UNITED STATES INC., a corporation having an office at
400 Kelby Street, Fort Lee, New Jersey 07024 (hereinafter referred to as
"Tenant").
W I T N E S S E T H:
Landlord and Tenant hereto, for themselves, their heirs,
distributees, executors, administrators, legal representatives, trustees,
successors and assigns, hereby covenant and agree as follows:
ARTICLE 1
PREMISES, TERM AND RENT
1.1 Landlord hereby leases to Tenant and Tenant hereby hires from
Landlord, subject to any ground leases and/or underlying leases hereafter
existing and/or mortgages as hereinafter provided, and upon and subject to the
covenants, agreements, terms, provisions, and conditions of this Lease, in the
building designated Building B on the site plan annexed hereto as Exhibit A
(hereinafter referred to as the "Building") on land (the "Land") located in the
Town of Harrison, County of Westchester, State of New York and as more
particularly described in Exhibit B annexed hereto, and also commonly known as
"The Centre at Purchase", the following space: the portion of the first floor
designated on Exhibit C annexed hereto ("the demised premises"). The term of
this Lease shall be approximately ten (10) years, to commence on a date
(hereinafter referred to as the "Commencement Date") which shall be the earlier
of (i) the date on which the demised premises are substantially ready for
occupancy (as defined in Article 2 hereof), or (ii) the date Tenant or anyone
claiming under or through Tenant first occupies the demised premises for the
conduct of its business, and shall end on the last day of the month in which
occurs the tenth (10th) anniversary of the Commencement Date or if the
Commencement Date occurs on the first day of any month, on the day preceding the
day which is the tenth (10th) anniversary of the Commencement Date (such date on
which the term of the Lease expires is hereinafter referred to as the
"Expiration Date") or until such term shall earlier or later cease and terminate
as hereinafter provided.
<PAGE> 6
1.2 Tenant shall pay to Landlord a fixed annual rent ("fixed annual
rent") of:
(i) One Hundred and Forty-One Thousand Six Hundred Thirty-Six and
00/100 ($141,636) DOLLARS per year for the period commencing on the
Commencement Date and ending on the day preceding the fifth anniversary of
the Commencement Date; and
(ii) One Hundred and Fifty-Six Thousand Nine Hundred and 00/100
($156,900) DOLLARS per year commencing on the fifth anniversary of the
Commencement Date and ending on the Expiration Date.
Tenant agrees to pay the fixed annual rent in lawful money of the
United States of America, in equal monthly installments in advance on the first
day of each calendar month during the term of this Lease, at the office of
Landlord or such other place in the United States of America as Landlord may
designate, without any setoff or deduction whatsoever, except such deduction as
may be occasioned by the occurrence of any event permitting or requiring a
deduction from or abatement of rent as specifically set forth in Articles 13 and
14 hereof.
1.3 Tenant shall pay the fixed annual rent and additional rent as
above and as hereinafter provided, by good and sufficient check (subject to
collection) drawn on a bank which is a member of the New York Clearinghouse
Association or a successor thereto. Tenant is paying the first month's rent upon
the execution hereof. Fixed annual rent and the monthly payments set forth in
Section 4.4(b)(iii) shall be paid when due in accordance with the terms of this
Lease. All other sums payable by Tenant hereunder shall be payable within ten
(10) days after written demand for same, unless other payment dates are
hereinafter provided. All sums other than fixed annual rent payable by Tenant
hereunder shall be deemed additional rent, the default in the payment of which
Landlord shall have the same remedies as for a default in the payment of fixed
annual rent.
1.4 If Tenant shall fail to pay when due any installment of fixed
annual rent for a period of five (5) days after such installment shall have
become due, or if Tenant shall fail to pay any payment of additional rent for a
period of five (5) days after written notice is given to Tenant that such
payment shall have become due, then without regard to any other remedies which
Landlord may have as a consequence of such default, Tenant shall pay interest
thereon at the "Interest Rate" (as such term is defined in Article 22 hereof),
from the date when such installment shall have become due or notice of such
additional rent being due is given (as the case may be) to the date of the
payment thereof, and such interest shall be deemed additional rent.
-2-
<PAGE> 7
1.5 Notwithstanding any language to the contrary contained in this
Lease, the fixed annual rent and all additional rent (excluding payments for
electrical use pursuant to Article 12) due under this Lease shall be abated
during the first four (4) month period of the term of this Lease after the
Commencement Date.
ARTICLE 2
COMMENCEMENT OF TERM
2.1 The demised premises shall be completed and prepared for
Tenant's occupancy in the manner, and subject to the terms, conditions and
covenants, set forth in Exhibit D and Exhibit D-l annexed hereto.
2.2 The demised premises shall be deemed substantially ready for
occupancy when (i) "Landlord's Work" (as such term is defined in Section 2.1 of
Exhibit D annexed hereto) shall have been substantially completed and (ii) a
certificate of occupancy or similar certificate or permit (temporary or final)
shall have been issued by the appropriate local authority permitting lawful
occupancy of the demised premises. Landlord's Work shall be deemed to have been
substantially completed (A) despite the fact that minor or insubstantial details
of construction, decoration or mechanical adjustment remain to be performed,
provided the demised premises are accessible and usable consistent with the
intended use of the demised premises (Landlord will diligently complete such
details of construction, decoration or mechanical adjustment), and (B) if
Landlord's Work has been substantially completed except for portions thereof
which under good construction scheduling practice should be done after still
uncompleted work which Tenant wishes to perform at the demised premises. "Minor
or insubstantial details of construction" as used in clause (A) of the
immediately preceding sentence shall not include installation of the ceiling,
lighting fixtures, carpeting, walls or doors at the demised premises pursuant to
the requirements of Exhibit D-l annexed hereto. If, as of the Commencement Date,
Landlord shall have obtained only a temporary certificate of occupancy with
respect to the demised premises, Landlord shall diligently thereafter obtain a
permanent certificate of occupancy therefor.
2.3 The Commencement Date shall be deemed to have occurred on the
date (and Tenant shall be obligated to pay fixed annual rent and additional rent
as of such date) when the demised premises reasonably would have been
substantially ready for occupancy except for "Tenant's Delay" (as such term is
defined in Exhibit D hereof) or Tenant's failure of compliance with the
provisions of Exhibit D hereof, even though no certificate of
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occupancy or other similar certificate or permit (temporary or final) has been
issued or no work to be done by Landlord has been commenced or completed.
2.4 Landlord shall, in accordance with the foregoing, fix the
Commencement Date and shall notify Tenant of the date so fixed. When the
Commencement Date has been so determined, at Landlord's request, the parties
hereto shall within fifteen (15) days after such request, execute a written
agreement confirming such date as the Commencement Date. Any failure of the
parties to execute such written agreement shall not affect the validity of the
Commencement Date as fixed and determined by Landlord and as aforesaid. In
addition to the foregoing procedure for fixing the Commencement Date, Landlord
shall endeavor, ten (10) days prior to the Commencement Date, as estimated by
Landlord in its reasonable judgment, to notify Tenant of such estimated
Commencement Date and Landlord shall also endeavor to notify Tenant within ten
(10) days of the beginning of Landlord Work, as set forth in Exhibit D hereto,
provided such Landlord Work is commenced prior to April 1, 1991.
2.5 Tenant by entering into occupancy of the demised premises shall
be conclusively deemed to have agreed that Landlord up to the time of such
occupancy had performed all of its obligations hereunder and that the demised
premises were in satisfactory condition as of the date of such occupancy, unless
within (a) ten (10) days after such date Tenant shall give written notice
(hereinafter called the "Punchlist Notice") to Landlord specifying the respects
in which the same were not in satisfactory condition, or (b) one (1) year from
such date Tenant shall give notice to Landlord (hereinafter called the "Latent
Defects Notice") specifying the latent defects in the demised premises, in which
event the demised premises shall be conclusively deemed to be in satisfactory
condition except for the items set forth in the Punchlist Notice or Latent
Defects Notice which items Landlord shall act diligently to complete or correct,
as the case may be. The giving of the Punchlist Notice shall have no effect
whatsoever upon the Commencement Date.
2.6 Landlord and Tenant acknowledge that the demised premises are
intended to be substantially ready for occupancy by Tenant, pursuant to the
terms of this Article 2, on or about July 1, 1992. If the demised premises are
substantially ready for occupancy prior to July 1, 1992, Landlord shall fix the
Commencement Date as of such date as provided herein. If, pursuant to the terms
of this Article 2, the demised premises are not substantially ready for
occupancy by November 15, 1992 (as extended by reason of Tenant Delay), Tenant
shall have the right to terminate this Lease by notice to Landlord pursuant to
Article 31. From and after such termination, the parties shall have no further
rights or obligations hereunder. Landlord represents that the lease for the
demised premises with the
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current tenant expires on March 31, 1992 pursuant to the terms of such lease and
that the right of the current tenant to exercise its right to an extension of
the term has expired pursuant to the terms of such lease.
ARTICLE 3
TAX ESCALATION
3.1 Tenant shall pay to Landlord, as additional rent, tax escalation
in accordance with the provisions of this Article.
3.2 Definitions:
(a) the term "Tax Year" shall mean each period of twelve months,
commencing on the first day of January in which occurs any part of the term of
this Lease;
(b) the term "the A/B Building" shall mean the structure designated
as the "A/B Building" on Exhibit A annexed hereto, a portion of which is
constituted by the Building;
(c) the term the "Land" shall have the meaning set forth in Section
1.1;
(d) subject to clause (ii) of Section 3.10 and to Section 4.11, the
term "Comparative Year" shall mean the calendar year commencing on January 1,
1993 and each subsequent calendar year;
(e) the term "Land Taxes" shall mean the total of all real estate
and other taxes and special, general, extraordinary or other assessments, sewer
rents, water charges, occupancy taxes, school taxes, and other taxes or charges
of any kind or nature levied, assessed, imposed or attributable at any time by
any governmental authority (including without limitation any town, city,
district, county, village, school district or public transportation authority)
upon or against the Land, and also any tax, assessment, or charge, levied,
assessed or imposed at any time by any governmental authority in connection with
the receipt of income or rents from the Land to the extent that same shall be in
lieu of all or a portion of any of the aforesaid taxes, assessments or charges,
or additions or increases thereof. 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 the Land Taxes, then such franchise, income, transit, profit or other tax or
governmental imposition shall be deemed to be included within the definition of
"Land Taxes" for
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the purposes hereof. The term "Land Taxes" shall not be deemed to include (i)
gift or inheritance taxes, (ii) corporate franchise taxes or similar business
taxes imposed on noncorporate business entities, (iii) realty transfer taxes or
real property transfer gains taxes imposed in connection with the sale of or the
lease of all or substantially all of the Land or the A/B Building, (iv) mortgage
recording taxes or (v) income taxes, except with respect to any such taxes
assessed or imposed in lieu of real estate taxes or any portion thereof. As to
special assessments which are payable over a period of time extending beyond the
term 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 Land Taxes. If, by law, any assessment shall be payable in
installments, then, for the purposes hereof (i) such assessment shall be deemed
to have been payable in the maximum number of installments permitted by law and
(ii) there shall be included in Land Taxes, for each Tax Year in which such
installments may be paid, the installments of such assessment so becoming
payable during such Tax Year, together with interest payable during such Tax
Year;
(f) the term "Building Taxes" shall have the meaning set forth in
(e), above, except that the phrases "Land Taxes" and "Land" shall be changed to
read "Building Taxes" and "A/B Building," respectively;
(g) the term "Land Tax Base Factor" shall mean the amount of Taxes
attributable to the Land for the calendar year 1992;
(h) the term "Building Tax Base Factor" shall mean the amount of
Taxes attributable to the Building for the calendar year 1992;
(i) the term "the Building Project" shall mean the Land with all the
improvements thereon (including, without limitation, the office building(s) and
parking areas erected thereon);
(j) the term "the Land Percentage," for purposes of computing the
Tax Escalation Payments (as hereinafter defined) to be made pursuant to this
Article, shall (subject to the provisions of Section 3.10 hereof) mean one and
eight one-hundredths of one (1.08%) percent. The Land 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
rentable square foot area of the office building(s) comprising the Building
Project. The parties agree that the rentable square foot area of the demised
premises shall be deemed to be 6,105 rentable square feet and that the rentable
square foot area of the A/B Building shall be deemed to
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be 281,837, the rentable square foot area of the building designated Building D
on Exhibit A annexed hereto shall be deemed to be 196,774, the rentable square
foot area of the building designated Building C on Exhibit A annexed hereto
shall be deemed to be 86,804, and that the total rentable square foot area of
all the office building(s) comprising a part of the Building Project shall be
deemed to be 565,415 rentable square feet. Tenant acknowledges that the Land
Percentage will be adjusted in the event that the rentable area of the office
space comprising the Building Project shall be increased or reduced as set forth
in Section 3.10 hereof;
(k) the term "the Building Percentage," for purposes of computing
the Tax Escalation Payments (as hereinafter defined) to be made pursuant to this
Article, shall mean two and seventeen one-hundredths of one (2.17%) percent.
The Building 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 rentable square foot area of the A/B Building.
The parties agree that the rentable square foot area of the demised premises
shall be deemed to be 6,105 rentable square feet and that the total rentable
square foot area of the A/B Building shall be deemed to be 281,837 rentable
square feet;
(l) the term "Tax Escalation Statement" shall mean a written
statement setting forth the amount payable by Tenant or Landlord as the case may
be, for a specified Comparative Year pursuant to this Article, which Tax
Escalation Statement shall be accompanied by a copy of the applicable tax bills
from the taxing authorities when available; and
(m) the term "Taxes" shall mean collectively the Land Taxes and the
Building Taxes.
3.3 In the event that the Land Taxes payable for any Comparative
Year shall exceed the Land Tax Base Factor, Tenant shall pay tax escalation to
Landlord, as additional rent for such Comparative Year, in an amount equal to
the Land Percentage of the excess. In the event that the Building Taxes payable
for any Comparative Year shall exceed the Building Tax Base Factor, Tenant shall
pay tax escalation to Landlord as additional rent for such Comparative Year, in
an amount equal to the Building Percentage of such excess. Any such amounts
being payable by Tenant pursuant to this Section 3.3 are hereinafter called the
"Tax Escalation Payment". Before or after the start of each Comparative Year,
Landlord shall furnish to Tenant a Tax Escalation Statement of the Taxes payable
for such Comparative Year or reasonable estimates thereof if bills are not yet
available. If the Land Taxes payable for such Comparative Year exceed the Land
Tax Base Factor, additional rent for such Comparative Year in an amount equal to
the Land Percentage of the
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excess shall be due from Tenant to Landlord after Landlord has furnished Tenant
with the Tax Escalation Statement. If the Building Taxes payable for such
Comparative Year exceed the Building Tax Base Factor, additional rent for such
Comparative Year in an amount equal to the Building Percentage of the excess
shall be due from Tenant to Landlord after Landlord has furnished Tenant with
the Tax Escalation Statement. Tenant agrees to make payments on account of the
additional rent for each Comparative Year in twelve (12) monthly installments,
each in an amount equal to one-twelfth (1/12) of the Tax Escalation Payment,
which installments may be adjusted by Landlord as bills are received for which
estimates were used. If, as finally determined, the amount of additional rent
payable by Tenant to Landlord pursuant to this Section 3.3 for a Comparative
Year shall be greater than (resulting in an underpayment) or be less than
(resulting in an overpayment) the aggregate of all the installments so paid on
account to Landlord by Tenant for such Comparative Year, then, promptly after
the receipt of the Tax Escalation Statement for such Comparative Year and, in
performance of its obligations under this Article, Tenant shall, in the case of
such an underpayment, pay to Landlord an amount equal to such underpayment or
Landlord shall, in the case of such an overpayment, either (i) pay to Tenant an
amount equal to such overpayment or (ii) credit against the next installment(s)
of fixed annual rent due from Tenant an amount equal to such overpayment. If a
Tax Escalation Statement is furnished to Tenant after the commencement of the
Comparative Year in respect of which such Tax Escalation Statement is rendered,
Tenant shall, within fifteen (15) days thereafter pay to Landlord an amount
equal to those installments of the total Tax Escalation Payment payable as
provided in this Section 3.3 during the period prior to the first day of the
month next succeeding the month in which the applicable statement has been
furnished.
3.4 If, after Tenant shall have made a payment of additional rent
under this Article, the Taxes payable for any Comparative Year on which such
payment of additional rent shall have been based shall be changed, then the
amount payable for that Comparative Year shall be revised to reflect such change
and appropriate adjustments promptly made between Landlord and Tenant. If, after
Tenant shall have made a payment of additional rent under this Article, Landlord
shall receive a refund of any portion of the Taxes payable for any Comparative
Year on which such payment of additional rent shall have been based, as a result
of a reduction of such Taxes by final determination of legal proceedings,
settlement or otherwise, Landlord shall either (i) after receiving the refund
pay to Tenant the Land or Building Percentage, as the case may be, of the refund
or (ii) credit against the next installment(s) of fixed annual rent due from
Tenant an amount equal to the Land or Building percentage of the refund, as the
case may be, together with interest thereon at the Prime Rate (as such term is
defined in Section 22.3 hereof) if
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such excess amount was greater than ten (10%) percent of the amount due and
payable as the Tax Escalation Payment.
3.5 The Tax Escalation Statement to be furnished by Landlord as
provided in this Article shall constitute a final determination as between
Landlord and Tenant of the Tax Escalation Payment for the periods represented
thereby unless Tenant shall have paid the amount thereof and, within sixty (60)
days after the Tax Escalation Statement is furnished, shall give a notice to
Landlord that it disputes its accuracy or its appropriateness which notice shall
specify the particular respects in which the Tax Escalation Statement is
inaccurate or inappropriate. Copies of the tax bills and the relevant records in
the tax assessor's office shall be deemed prima facie evidence of the facts set
forth on the Tax Escalation Statement.
3.6 In no event shall the fixed annual rent under this Lease be
reduced by virtue of this Article.
3.7 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. Such 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 due from Tenant, as aforesaid, and Landlord and Tenant shall
thereupon make appropriate adjustments of amounts then owing.
3.8 Landlord's and Tenant's obligation to make the adjustments
referred to in Section 3.7 hereof above shall survive any expiration or
termination of this Lease. After the termination of the Lease, the final
adjustment for the Tax Escalation Payment pursuant to this Article 3 shall be
made as soon as practicable, and if Landlord retains any moneys of Tenant due to
excess payments made by Tenant hereunder, such excess moneys shall be promptly
refunded to Tenant after such final adjustment has been made.
3.9 Any delay or failure of Landlord to bill any Tax Escalation
Payment as provided in this Article 3 shall not constitute a waiver of or in any
way impair the continuing obligation of Tenant to pay such Tax Escalation
Payment.
3.10 Notwithstanding any other provision of this Article 3 to the
contrary, (i) if the parcel of land on which any of the buildings comprising a
part of the Building Project shall
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be assessed as a separate tax lot, the Land Percentage and the Land Tax Base
Factor shall be appropriately adjusted and (ii) no additional rent shall be
charged to or payable by Tenant for tax escalation prior to one (1) year from
the Commencement Date, by example, if for the first twelve (12) month period
following the Commencement Date any tax escalation would otherwise be payable,
Tenant's share thereof shall be pro-rated and apportioned so that Tenant only
pays that portion which is applicable to the period commencing after the first
anniversary of the Commencement Date.
ARTICLE 4
EXPENSE ESCALATION
4.1 Tenant shall pay to Landlord, as additional rent, expense
escalation in accordance with this Article.
4.2 Definitions:
(a) the term "Building Expense Base Factor" shall mean the amount of
Building Expenses incurred for the calendar year 1992, provided that if Building
A/B is less than 95% leased and occupied during the calendar year 1992, then,
for the purposes of computing the Building Expenses Base Factor, the amount of
Building Expenses for such calendar year shall be deemed to be increased by an
amount equal to the additional Building Expenses which would reasonably have
been incurred during such calendar year by Landlord if Building A/B were 95%
leased and occupied;
(b) the term "Non-Building Expense Base Factor" shall mean the
amount of Non-Building Expenses incurred for the calendar year 1992;
(c) the term "Expense Escalation Statement" shall mean a written
statement setting forth the amount payable by Tenant for a specified Comparative
Year pursuant to this Article;
(d) the term "Building Expenses" shall mean the total amount of all
costs and expenses incurred or paid by Landlord with respect to and in
connection with the operation, maintenance and/or normal operating repair of the
A/B Building, including, without limitation, the cost incurred for (1) air
conditioning; (2) mechanical ventilation; (3) heating; (4) cleaning comparable
to the Cleaning Specifications annexed as Exhibit F; (5) rubbish removal; (6)
window washing (interior and exterior, including inside partitions); (7)
elevators; (8) escalators; (9) porter and matron service; (10) electric current
including electricity for heating, ventilation, air-conditioning and exterior
lighting and the parking areas appurtenant thereto (excluding, however, the cost
of any electricity directly metered to tenants or otherwise
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allocable to space in the A/B Building demised to tenants); (11) oil, purchased
steam or any other fuel consumed at the A/B Building; (12) protection and
security; (13) ordinary maintenance (including but not limited to regular
painting of non-tenanted areas at the A/B Building); (14) maintenance and repair
of lobby decorations; (15) interior landscape work and maintenance; (16)
premiums for fire, extended coverage, boiler, sprinkler, apparatus, war risk (if
expressly required by mortgagee) and property damage insurance, rental and plate
glass insurance and any other insurance required by a mortgagee; (17) supplies;
(18) wages, salaries, disability benefits, pensions, hospitalization, retirement
plans and group insurance respecting service and maintenance employees of
Landlord; (19) uniforms and working clothes for such employees and the cleaning
thereof; (20) expenses imposed on Landlord pursuant to law or to any collective
bargaining agreement with respect to such employees; (21) worker's compensation
insurance, payroll, social security, unemployment and other taxes with respect
to such employees; (22) sales, utility and use taxes and other taxes of like
import; (23) water rates and sewer rates to the extent same is not included in
the definition of Taxes; (24) all normal operating charges incurred by any
superintendent's and manager's offices in the operation and maintenance of the
A/B Building; (25) charges for maintenance and service contracts for all common
areas of the A/B Building; (26) all other normal operating costs and expenses of
repair, operation and maintenance of the A/B Building; (27) the fees of the
superintendent, their assistants and any clerical staff working for such
superintendent whose duties are connected with the maintenance and operation of
the A/B Building; (28) reasonable professional and consulting fees, including
legal and audit fees; (29) the expenses, including reasonable payments to
attorneys, appraisers and other experts incurred by Landlord in connection with
any application or proceeding wherein Landlord obtains or seeks to obtain
reduction or refund of the Taxes payable or paid upon or against the A/B
Building, but only to the extent of such reduction or refund of Taxes; (30)
whether or not capitalized under generally accepted accounting principles, the
cost of repairs and the cost of component replacements made in connection with
repairs of cables, fans, pumps, boilers, cooling equipment, wiring the
electrical fixtures and metering, control and distribution equipment, component
parts of the HVAC, electrical, plumbing, elevator and any life or property
protection systems (including, without limitation, sprinkler systems), window
washing equipment and snow removal equipment; and (31) managing agents' fees
comparable to those charged by other managing agents in Westchester County who
manage similar building projects, or if Landlord elects to manage (or have an
affiliate manage) the A/B Building, an annual fee, for management of the A/B
Building, in an amount equal to 3% of the rental revenues received by Landlord
from the A/B Building for the Comparative Year in question.
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Provided, however, that the following items shall be excluded from Building
Expenses:
(i) leasing commissions;
(ii) cost of repairs or replacements incurred by reason of fire or
other casualty (to the extent that Landlord is compensated therefor
through proceeds of insurance above deductible amounts, provided that
Landlord insures the A/B Building against casualty and loss up to its
replacement value), or caused by the exercise of the right of eminent
domain (to the extent the same is covered by any condemnation award);
(iii) Taxes;
(iv) "Non-Building Expenses", as that term is hereinafter defined;
(v) costs incurred in performing work or furnishing services to or
for individual tenants (including this Tenant) at such tenant's expense;
and costs of performing work or furnishing services for tenants other than
this Tenant at Landlord's expense, to the extent that such work or service
is in excess of any work or service Landlord is obligated to furnish to or
for this Tenant at Landlord's expense;
(vi) expenditures for capital improvements other than those that are
(a) specifically included in the definition of Building Expenses; or (b)
included as Building Expenses pursuant to the provisions of Section 4.3(a)
or (b);
(vii) that portion of any cost or expense relating to both the A/B
Building and to other buildings or properties owned by Landlord, which is
properly allocable or attributable to such other buildings or properties
unless otherwise provided in this Lease;
(viii) debt service on any mortgages encumbering the A/B Building,
or depreciation of the A/B Building; and
(ix) the cost for those services provided to other tenants in the
A/B Building which services are not also provided to Tenant.
(e) "Non-Building Expenses" shall mean the total of public liability
insurance and all the costs and expenses incurred or borne by Landlord in
connection with the operation, maintenance and/or normal operating repairs of
the "Common Areas" (as that term is hereinafter defined) including, without
limitation, the cost incurred for snow and ice removal, grading
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in connection with landscaping, and striping and repair of parking lot surfaces;
cleaning, exterior landscaping, and maintenance, installation, repair and
replacement of signage, traffic control devices and signs; security, ordinary
maintenance, charges for maintenance and service contracts; repair (other than
capital replacements unless specifically included herein) and improvements which
are appropriate for the operation of the Common Areas of a first class office
building project in Westchester County, New York; all normal operating charges
incurred by any superintendent's and manager's offices in the operation and
maintenance of the Common Areas; the fees of the manager and superintendent,
their assistants and any clerical staff working for such manager or
superintendent whose duties are connected with the operation and maintenance of
the Common Areas; whether or not capitalized under generally accepted accounting
principles, the cost of repairs and the cost of component replacements made in
connection with repairs of Common Area cables, fans, pumps, boilers, cooling
equipment, wiring and electrical fixtures and metering, control and distribution
equipment, component parts of the HVAC, electrical, plumbing, elevator and any
life or property protection systems (including, without limitation, sprinkler
systems), window washing equipment and snow removal equipment;
Provided, however that the following items shall be excluded from Non-Building
Expenses:
(i) Building Expenses;
(ii) Taxes;
(iii) expenditures for capital improvements other than those that
are (a) specifically included in the definition of Non-Building Expenses
or (b) included as Non-Building Expenses pursuant to the provisions of
Sections 4.3(a) or (b);
(iv) that portion of any cost or expense relating to both the Common
Areas and to other buildings or properties owned by Landlord, which is
properly allocable or attributable to such other buildings or properties
unless otherwise provided in this Lease; and
(v) debt service on any mortgages encumbering the Common Areas, or
depreciation of any portion of the Common Areas.
(f) The term "Expenses" shall mean the Building Expenses and
Non-Building Expenses.
4.3 (a) If Landlord shall purchase any item of capital equipment or
make any capital expenditure that results in
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savings or reductions in expenses, the costs for same shall be included in
Expenses. If Landlord shall lease any such item of capital equipment that
results in savings or reductions in Expenses, then the rentals and other
reasonable costs paid pursuant to such leasing shall be included in Expenses for
the Comparative Year in which they were incurred.
(b) If Landlord shall purchase any item of capital equipment or make
any other capital expenditure in order to comply with Legal Requirements
promulgated after the Commencement Date, then the costs for same shall be
included in Expenses for the Comparative Year in which the costs are incurred
and subsequent Comparative Years, on a straight line basis, amortized under
generally accepted accounting principles. If Landlord shall lease any such item
of capital equipment to comply with Legal Requirements then the rentals and
other costs paid pursuant to such leasing shall be included in Expenses for the
Comparative Year in which they were incurred.
(c) If during all or part of any Comparative Year, Landlord shall
not furnish any particular item(s) of work or service (which would constitute an
element of Expense hereunder) to portions of the A/B Building, due to the fact
that such portions are not occupied or leased, or because such item of work or
service is not required or desired by the tenant of such portion, or such tenant
is itself obtaining and providing such item of work or service, or for other
reasons, then, for the purposes of computing the additional rent payable
hereunder, the amount of the expenses for such item for such period shall be
deemed to be increased by an amount equal to the additional operating and
maintenance expenses which would reasonably have been incurred during such
period by Landlord if it had at its own expense furnished such item of work or
services to such portion of the A/B Building or the Common Areas.
4.4 (a) If the Building Expenses for any Comparative Year shall be
greater than the Building Expense Base Factor, Tenant shall pay to Landlord, as
additional rent for such Comparative Year, in the manner hereinafter provided,
an amount equal to the Building Percentage of the excess of the Building
Expenses for such Comparative Year over the Building Expense Base Factor. If the
Non-Building Expenses for any Comparative Year shall be greater than the
Non-Building Expense Base Factor, Tenant shall pay to Landlord, as additional
rent for such Comparative Year, in the manner hereinafter provided, an amount
equal to the Land Percentage of the excess of the Non-Building Expenses for such
Comparative Year over the Non-Building Expense Base Factor. The amounts payable
by Tenant under this Section 4.4(a) are, collectively, the "Expense Payment."
(b) Following the expiration of each Comparative Year, Landlord
shall submit to Tenant an Expense Escalation statement,
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certified by Landlord, setting forth the Expenses for the preceding Comparative
Year and the Expense Payment, if any, due to Landlord from Tenant for such
Comparative Year. The rendition of such Expense Escalation Statement to Tenant
shall constitute prima facie proof of the accuracy thereof and, if such
statement shows an Expense Payment due from Tenant to Landlord with respect to
the preceding Comparative Year then (i) Tenant shall make payment of any unpaid
portion thereof within twenty (20) days after receipt of such Expense Escalation
Statement; (ii) Tenant shall also pay to Landlord, as additional rent, within
twenty (20) days after receipt of such Expense Escalation Statement, an amount
equal to (x) the product obtained by multiplying the total Expense Payment for
the preceding Comparative Year by a fraction, the denominator of which shall be
twelve (12) and the numerator of which shall be the number of months of the
current Comparative Year which shall have elapsed prior to the first day of the
month immediately following the rendition of such Expense Escalation Statement
less (y) the aggregate amount of Expense Payment paid by Tenant for such elapsed
months; and (iii) Tenant shall also pay to Landlord, as additional rent,
commencing as of the first day of the month immediately following the rendition
of such Expense Escalation Statement and on the first day of each month
thereafter until a new Expense Escalation Statement is rendered, one-twelfth
(1/12) of the total Expense Payment for the preceding Comparative Year. The
aforesaid monthly payments based on the total Expense Payment for the preceding
Comparative Year shall be adjusted to reflect, as reasonably estimated by
Landlord, increases in rates and amounts, for the current Comparative Year,
applicable to the categories involved in computing Expenses, whenever such
increases become reasonably known or anticipated prior to or during such current
Comparative Year. The payments required to be made under clauses (ii) and (iii)
of this subsection 4.4(b) shall be credited toward the Expense Payment due from
Tenant for the then-current Comparative Year, subject to adjustment as and when
the Expense Escalation Statement for such current Comparative Year is rendered
by Landlord.
(c) The Expense Escalation Statement to be furnished by Landlord
shall constitute a final determination as between Landlord and Tenant of the
Expenses for the periods represented thereby, unless Tenant shall have paid the
Expense Payment and, within sixty (60) days after it is furnished, shall give a
notice to Landlord that it disputes its accuracy or its appropriateness, which
notice shall specify the particular respects in which the Expense Escalation
Statement is inaccurate, inappropriate or incomplete. Pending the resolution of
such dispute, Tenant shall pay the additional rent to Landlord in accordance
with the Expense Escalation Statements furnished by Landlord. After payment of
said additional rent, Tenant's certified public accountant shall have the right,
during reasonable business hours and upon not less than five (5) business days'
prior written notice to Landlord, to examine Landlord's books and records with
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respect to the foregoing (which Landlord shall maintain in either Westchester
County or New York County for three (3) years subsequent to the Escalation Year
to which they relate) and, at Tenant's expense, to make copies thereof, provided
such examination is commenced within sixty (60) days and concluded within one
hundred-twenty (120) days following the rendition of the Expense Escalation
Statement in question. Landlord shall cooperate with Tenant in any such
examination of its books and records and shall, if requested by Tenant in
writing, make a member of its staff available to explain any entries in such
books and records.
(d) Any such dispute as to an Expense Escalation Statement referred
to in subsection 4.3(c) hereof shall be resolved by arbitration in accordance
with the Commercial Arbitration Rules of the American Arbitration Association,
except that the arbitration shall be by three (3) arbitrators each of whom shall
be a certified public accountant. Except as hereinafter provided in this
paragraph, the cost of such arbitration shall be split equally between Landlord
and Tenant. If the arbitrators decide that the Expense Payment shown on the
Expense Escalation Statement was overstated by more than five (5%) percent, then
Landlord shall pay the cost of such arbitration. If the arbitrators decide that
the Expense Payment shown on the Expense Escalation Statement was understated by
more than five (5%) percent, then Tenant shall pay the cost of such arbitration.
4.5 In no event shall the fixed annual rent under this Lease be
reduced by virtue of this Article.
4.6 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 cause an Expense Escalation Statement of the Expenses for that Comparative
Year to be prepared and furnished to Tenant. Landlord and Tenant shall thereupon
make appropriate adjustments of amounts then owing.
4.7 Landlord's and Tenant's obligation to make the adjustments
referred to in Section 4.6 hereof shall survive any expiration or termination of
this Lease.
4.8 Any delay or failure of Landlord in billing any Expense Payment
hereinabove or hereinafter provided shall not
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constitute a waiver of or in any way impair the continuing obligation of Tenant
to pay such expense escalation hereunder.
4.9 Landlord and Tenant agree that in the event of any overpayment
or underpayment of any Expense Payment, the amount of any excess to be credited
to Tenant, or the amount of any deficiency to be paid by Tenant shall be
credited or paid from the date such deficiency was due, or such overpayment was
made until, respectively, the date paid or credited, together with interest
thereon at the Prime Rate (in the case of an excess amount to be credited to
Tenant) if such excess amount was greater than ten (10%) percent of the amount
due and payable as the Expense Payment.
4.10 Tenant acknowledges that the Building Project includes other
office buildings. If the operation of such building is combined with the
operation of the A/B Building, so that Building Expenses include such items with
respect to such office building, (a) the "Building Percentage" (for the purposes
of this Article 4 only) shall be reduced to reflect the percentage which the
rentable square foot area of the demised premises bears to the total rentable
square foot area of the A/B Building and such office building, and (b) the
Building Expense Base Factor shall be increased to include the Building Expenses
attributable to such office building.
4.11 Notwithstanding any of the provisions of this Article 4 to the
contrary, no additional rent for expense escalation shall be charged to or
payable by Tenant prior to one (1) year from the Commencement Date, by example,
if for the first twelve (12) month period following the Commencement Date any
expense escalation would otherwise be payable, Tenant's share thereof shall be
pro-rated and apportioned so that Tenant only pays that portion which is
applicable to the period commencing after the first anniversary of the
Commencement Date.
ARTICLE 5
USE
5.1 The demised premises shall be used solely as and for executive
and general offices and other related uses customary for executive and general
offices and for no other purpose.
5.2 Tenant shall not use or permit the use of the demised premises
or any part thereof in any way which would violate any of the covenants,
agreements, terms, provisions and conditions of this Lease or for any unlawful
purposes or in any unlawful manner or in violation of the certificate of
occupancy
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or other certificate or permit for the demised premises or the A/B Building, and
Tenant shall not suffer or permit the demised premises or any part thereof to be
used in any manner or anything to be done therein or anything to be brought into
or kept therein which, in the reasonable judgment of Landlord, shall in any way
impair the character, reputation or appearance of the Building as a high quality
office building, impair or interfere with any of the A/B Building services or
the proper and economic heating, cleaning, air conditioning or other servicing
of the A/B Building or the demised premises, or impair or interfere with the use
of any of the other areas of the A/B Building by, or occasion discomfort,
inconvenience or annoyance to, any of the other tenants or occupants of the A/B
Building.
5.3 If Tenant uses any portion of the demised premises for the
preparation or consumption of food, Tenant shall pay to Landlord the cost of
employing, on an as-needed basis, an exterminator to keep the demised premises
free from vermin. If any area of the demised premises is altered by Tenant after
the Commencement Date for preparation or consumption of food, Tenant shall cause
such food preparation area to be properly ventilated so that no odor shall
emanate from the demised premises to any other portion of the Building, and
shall bag all wet garbage and place the same in containers that prevent the
escape of odor.
ARTICLE 6
ALTERATIONS AND INSTALLATIONS
6.1 Except for non-structural or cosmetic alterations not in excess
of $15,000, Tenant shall make no alterations, installations, additions or
improvements (such work hereinafter collectively referred to as "Alterations")
in or to the demised premises without Landlord's prior written consent and then
only by contractors or mechanics first approved by Landlord. All Alterations
shall be done at Tenant's sole cost and expense, and at such times and in such
manner as Landlord may from time to time reasonably designate. Tenant shall
obtain and deliver to Landlord written, unconditional waivers of mechanic's or
other liens on the real property (to the extent permitted by law) in which the
demised premises are located, signed by all architects, engineers, contractors,
mechanics and designers involved in such Alterations as and when such
architects, engineers, contractors, mechanics and designers are paid for their
work in connection therewith.
Any Alterations in the demised premises shall be effected solely in
accordance with the approved plans and specifications. Tenant shall reimburse
Landlord promptly upon demand for any reasonable out-of-pocket costs and
expenses
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incurred by Landlord in connection with Landlord's review of such Tenant's plans
and specifications. Landlord will not unreasonably withhold or delay its consent
for nonstructural Alterations (provided they will not affect the outside of the
A/B Building or adversely affect the A/B Building's structure, electrical, HVAC,
plumbing or mechanical systems). Prior to granting its consent to Alterations,
Landlord may impose such conditions as to guarantee of completion and payment
and of restoration as Landlord may reasonably consider desirable.
Any such approved Alterations shall be performed in accordance with
the foregoing and the following provisions of this Article 6:
1. All Alterations shall be done in a good and workmanlike manner.
2. (a) In the event Tenant shall employ any contractor to do in the
demised premises any Alterations permitted by this Lease, such contractor and
any subcontractor shall agree to employ only such labor as will not result in
jurisdictional disputes or strikes or result in causing disharmony with other
workers employed at the A/B Building. Tenant will inform Landlord in writing of
the names of any contractor or subcontractor Tenant proposes to use in the
demised premises at least ten (10) days prior to the beginning of work by such
contractor or subcontractor, but such information given to Landlord shall in no
way constitute Landlord's approval of such contractor or subcontractor.
(b) Tenant covenants and agrees to pay to its contractor(s), as the
work progresses, the entire cost (less a reasonable retainage) of supplying the
materials and performing the work shown on Tenant's approved plans and
specifications in accordance with Tenant's contract or contracts with such
contractor(s). If Tenant desires to enter into a contract pursuant to which
Tenant shall pay less than the entire cost of such work, Tenant shall obtain
Landlord's prior written consent to such arrangement, which consent shall not be
unreasonably withheld or delayed.
3. All such Alterations shall be effected in compliance with all
applicable laws, ordinances, rules and regulations of governmental bodies having
or asserting jurisdiction in the demised premises.
4. Tenant shall keep the Building Project 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 on Tenant's behalf, and all work
to be performed by Tenant shall be done in a manner which will not unreasonably
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interfere with or disturb other tenants or occupants of the A/B Building.
5. During the progress of the work to be done by Tenant, said work
shall be subject to inspection by representatives of Landlord which shall be
permitted access and the opportunity to inspect, at all reasonable times, but
this provision shall not in any way whatsoever create any obligation on Landlord
to conduct such an inspection or create any obligations or liability (or relieve
Tenant of any obligations under this Lease) in the event Landlord does conduct
such an inspection.
6. Prior to commencement of any work, Tenant shall furnish to
Landlord certificates evidencing the existence of:
(i) worker's compensation insurance covering all persons employed
for such work; and
(ii) contractor's comprehensive general liability and property
damage insurance naming Landlord, any of its mortgagees and ground lessors
and Tenant as insureds, with coverage of at least $3,000,000 combined
single limit.
6.2 Any mechanic's lien, filed against the demised premises or the
A/B Building or the Building Project for work claimed to have been done for or
materials claimed to have been furnished to Tenant shall be discharged by Tenant
at its expense within forty-five (45) days after notice of such filing, by
payment, filing of the bond required by law or otherwise and Tenant shall
provide proof thereof reasonably satisfactory to Landlord. Notice is hereby
given that Landlord shall not be liable for any labor or materials furnished or
to be furnished to Tenant upon credit, and that no mechanic's or other lien for
any such labor or materials shall attach to or affect the reversion or other
estate or interest of Landlord in and to the demised premises.
6.3 All work, installations and improvements made and installed by
Landlord shall be the property of Landlord and shall remain upon and be
surrendered with the demised premises as a part thereof at the end of the term
of this Lease.
6.4 All Alterations, made and installed by Tenant, or at Tenant's
expense, upon or in the demised premises which are of a permanent nature and
which cannot be removed without damage to the demised premises or A/B Building
shall become and be the property of Landlord, and shall remain upon and be
surrendered with the demised premises as a part thereof at the end of the term
of this Lease. Notwithstanding the foregoing, Tenant shall remove all
Alterations which in Landlord's reasonable judgment are of a non-Building
Standard nature, such as internal
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stairways, slab openings, special electronic data processing or communications
installations, vaults and raised floors, at or before the Expiration Date or
within fifteen (15) days after any earlier termination date, and Tenant shall
repair or pay the cost of repairing any damage to the demised premises or the
A/B Building resulting from the removal thereof and restoring the demised
premises to their condition prior to the installation thereof. In connection
with the foregoing requirement, if at the time Tenant submits its request for
Landlord's consent to the Alterations, Tenant also requests that Landlord
identify which Alterations are of a non-Building Standard Nature, Landlord shall
submit such information to Tenant.
6.5 Where furnished by or at the expense of Tenant all furniture,
furnishings and trade fixtures, including, without limitation, murals, business
machines and equipment, telecommunications equipment, counters, screens, grille
work, special paneled doors, cages, partitions, metal railings, closets,
panelling, lighting fixtures and equipment, drinking fountains, refrigeration
and air handling equipment, and any other movable property shall remain the
property of Tenant which may at its option remove all or any part thereof at any
time prior to the expiration of the term of this Lease.
6.6 If any Alterations or other property which Tenant shall have the
right to remove or be requested by Landlord to remove as provided in Section 6.4
hereof (hereinafter called "Tenant's property") are not removed on or prior to
the expiration of the term of this Lease, Landlord shall have the right to
remove Tenant's property and to dispose of the same without accountability to
Tenant and at the sole cost and expense of Tenant. In case of any damage to the
demised premises or the A/B Building resulting from the removal of Tenant's
property, Tenant shall repair such damage or, in default thereof, shall
reimburse Landlord for Landlord's cost in repairing such damage. This obligation
shall survive any termination of this Lease.
6.7 Tenant shall keep records of Tenant's Alterations costing in
excess of $50,000, and of the cost thereof for a period of five (5) years after
the completion thereof. Tenant shall, within forty-five (45) days after demand
by Landlord, furnish to Landlord copies of such records and cost if Landlord
shall require the same in connection with any proceeding to reduce the assessed
valuation of the A/B Building or any other tax or charge, or in connection with
any proceeding instituted pursuant to Articles 13 or 14 hereof.
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ARTICLE 7
REPAIRS
7.1 Tenant shall, at its sole cost and expense, make such repairs to
the demised premises and the fixtures and appurtenances therein as are
necessitated by the act, omission, occupancy or negligence of Tenant or by the
use of the demised premises in a manner contrary to the purposes for which same
are leased to Tenant, as and when needed to preserve them in good working order
and condition subject to normal wear and tear and damage by fire or other
casualty. Except as otherwise provided in Section 9.8 hereof, all damage or
injury to the demised premises and to its fixtures, appurtenances and equipment
or to the A/B Building or to its fixtures, appurtenances and equipment caused by
Tenant moving property in or out of the A/B Building or by installation or
removal of furniture, fixtures or other property by or on behalf of Tenant,
shall be repaired, restored or replaced promptly by Tenant at its sole cost and
expense, which repairs, restorations and replacements shall be in quality and
class equal to the original work or installations. If Tenant (i) fails to make
such repairs, restoration or replacements, within ten (10) days after Landlord
gives Tenant notice of the necessity thereof or (ii) fails to commence within
said period and fails to thereafter diligently and continuously prosecute to
completion all steps necessary to remedy the same and to complete such remedy
within such time after the date of the giving of said notice of Landlord as
shall be necessary as reasonably determined by Landlord, but for a period not
longer than thirty (30) days, the same may be reasonably made by Landlord at the
expense of Tenant and such expense shall be collectible as additional rent and
shall be paid by Tenant within thirty (30) days after rendition of a bill
therefor.
The exterior walls of the A/B Building, the portions of any
windowsills outside the windows, and the windows are not part of the premises
demised by this Lease and Landlord reserves all rights to such parts of the A/B
Building, provided, however, Landlord shall use all reasonable efforts not to
interfere with the views and exposure from the demised premises, unless such
interference is necessitated by an event of force majeure or Legal Requirements.
7.2 Tenant shall not place a load upon any floor of the demised
premises exceeding fifty (50) pounds per useable square foot live load, and if
Tenant shall desire a floor load in excess of such floor load, Landlord agrees
to strengthen and reinforce the same so as to give the live load desired,
provided, (i) Tenant shall submit to Landlord the plans showing the locations of
and the desired floor live load for the areas in question, (ii) Tenant shall
agree to pay for or reimburse
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Landlord on demand for the cost of such strengthening and reinforcement as well
as any other costs to and expenses of Landlord occasioned by or resulting from
such strengthening or reinforcement, (iii) Landlord's architects, in their sole
reasonable discretion, find that the work necessary to increase such floor load
does not adversely affect the structure of the A/B Building, and (iv) such work
will not interfere with the amount or availability of any space adjoining
alongside, above or below the demised premises, or interfere with the occupancy
of other tenants in the A/B Building.
7.3 Landlord shall exercise reasonable diligence in the making of
any repairs, alterations, additions or improvements so as to minimize any
interference with Tenant's business operations, but shall not be required to
perform the same on an overtime or premium pay basis.
7.4 Landlord shall, at its expense (subject to reimbursement as set
forth in Article 4 hereof) keep and maintain the Common Areas and the A/B
Building in good condition and repair in accordance with the standards
appropriate to a first class office building in Westchester County, New York,
and make all repairs, structural and otherwise, interior and exterior, as and
when needed in or about the demised premises, except for those repairs for which
Tenant is responsible pursuant to the provisions of this Lease.
ARTICLE 8
REQUIREMENTS OF LAW
8.1 Tenant, at Tenant's cost and expense, shall comply with all
laws, orders and regulations of federal, state, county and municipal
authorities, and with any direction of any public officer or officers, pursuant
to law, which result from Tenant's use or occupation of the demised premises.
8.2 Notwithstanding the provisions of Section 8.1 hereof, Tenant, at
its own cost and expense, in its name and/or (whenever necessary) Landlord's
name, may contest, in any manner permitted by law (including appeals to a court,
or governmental department or authority having jurisdiction in the matter), the
validity or the enforcement of any governmental act, regulation or directive
with which Tenant is required to comply pursuant to this Lease, and may defer
compliance therewith provided that:
(a) such non-compliance shall not subject Landlord to criminal
prosecution or subject the Land and/or the Building Project to lien or sale;
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(b) such non-compliance shall not be in violation of any fee
mortgage, or of any ground or underlying lease or any mortgage thereon;
(c) Tenant shall first deliver to Landlord a surety bond (in such
sum as Landlord may reasonably request) issued by a surety company of recognized
responsibility, or other security satisfactory to Landlord, indemnifying and
protecting Landlord against any loss or injury by reason of such non-compliance;
and
(d) Tenant shall promptly and diligently prosecute such contest.
Landlord, without expense or liability to it, shall cooperate with
Tenant and execute any documents or pleadings required for such purpose,
provided that Landlord shall, reasonably be satisfied that the facts set forth
in any such documents or pleadings are accurate.
ARTICLE 9
INSURANCE, LOSS, REIMBURSEMENT, LIABILITY
9.1 Tenant shall not violate, or permit the violation of, any
condition imposed by any insurance policy then issued in respect to the Building
Project and/or the property therein and shall not do, or permit anything to be
done, or keep or permit anything to be kept in the demised premises which would
subject Landlord to any liability or responsibility for bodily injury or death
or property damage, or which would increase any insurance rate in respect to the
Building Project or the property therein over the rate which would otherwise
then be in effect or which would result in insurance companies of good standing
refusing to insure the Building Project or the property therein in amounts
reasonably satisfactory to Landlord, or which would result in the cancellation
of or the assertion of any defense by the insurer in whole or in part to claims
under any policy of insurance in respect of the Building Project or the property
therein, but nothing contained in this Section 9.1 shall be construed to
restrict Tenant's use of the demised premises for the purposes permitted under
Article 5 hereof.
9.2 If, by reason of any failure of Tenant to comply with the
provisions of Section 8.1 or Section 9.1, the premiums on Landlord's insurance
on the Building Project and/or equipment or property therein shall be higher
than they otherwise would be, Tenant shall reimburse Landlord, on demand, for
that part of such premiums attributable to such failure on the part of Tenant.
If by reason of any act of omission by Landlord, the premiums on Tenant's fire
insurance on Tenant's property shall be higher than
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they would otherwise be, Landlord shall reimburse Tenant for that part of such
fire insurance premiums attributable to such act or omission of Landlord and the
amount reimbursed to Tenant will be an excluded item from Building Expenses. A
schedule or "make up" of rates for the Building Project or the demised premises,
as the case may be, issued by the applicable fire insurance rating organization
or other similar body making rates for insurance for the Building Project or the
demised premises, as the case may be, shall be conclusive evidence of the facts
therein stated and of the several items and charges in the insurance rate then
applicable to the Building Project or the demised premises, as the case may be.
9.3 Tenant, at its expense, shall maintain at all times during the
term of this Lease (a) "all risk" property insurance covering Tenant's property
and improvements and betterments to a limit of not less than 80% of the
replacement cost thereof and (b) comprehensive general liability insurance,
including contractual liability, in respect of the demised premises and the
conduct or operation of business therein, with Landlord and its managing agent,
if any, and any lessor of any ground or underlying lease or the holder of any
mortgage, as the case may be, whose name and address shall have been furnished
to Tenant, as additional insureds, with limits of not less than $3,000,000
combined single limit bodily injury and property damage liability. Landlord
hereby agrees that the comprehensive general liability insurance requirement
described in clause (b) of the preceding sentence may be satisfied through the
use of umbrella coverage, which umbrella coverage must be evidenced by a policy
or certificate of insurance in form reasonably satisfactory to Landlord. The
limits of such insurance shall not limit the liability of Tenant hereunder.
Tenant shall deliver to Landlord and any additional insureds such fully paid-for
policies or certificates of insurance in form reasonably satisfactory to
Landlord (or true and complete copies thereof) issued by the insurance company
or its authorized agent, at least ten (10) days prior to occupancy of the
demised premises by Tenant. Tenant shall procure and pay for renewals of such
insurance from time to time before the expiration thereof, and Tenant shall
deliver to Landlord and any additional insureds such renewal policy or
certificates of coverage at least thirty (30) days before the expiration of any
existing policy. All such policies shall be issued by companies reasonably
acceptable to Landlord. If Landlord is included as a named payee on any check
issued by Tenant's insurer in payment of any claim solely with respect to
Tenant's property, Landlord agrees that it will promptly upon Tenant's request
endorse such check to Tenant. Landlord further agrees that it shall have no
right or authority to participate in any settlement of any claim by Tenant
against its insurer which relates solely to damage or loss to Tenant's property.
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9.4 Each party agrees to have included in each of its insurance
policies a waiver of the insurer's right of subrogation against the other party
(and in the case of Tenant against other tenants of the A/B Building) during the
term of this Lease or, if such waiver should be unobtainable or unenforceable,
(i) an express agreement that such policy shall not be invalidated if the
assured waives the right of recovery against any party responsible for a
casualty covered by the policy before the casualty, or (ii) any other form of
permission for the release of the other party. If such waiver, agreement or
permission shall not be, or shall cease to be, obtainable from either party's
then current insurance company, the insured party shall so notify the other
party promptly after learning thereof, and shall use its best efforts to obtain
the same from another insurance company described in Section 9.3 hereof. Each
party hereby releases the other party (and in the case of Tenant, other tenants
of the A/B Building who shall have executed a similar waiver or agreement as
set forth in this Section 9.4) with respect to any claim (including a claim for
negligence) which it might otherwise have against the other party, for loss,
damage or destruction with respect to its property occurring during the term of
this Lease to the extent to which it is insured under a policy or policies
containing a waiver of subrogation or permission to release liability, as
provided in the preceding subdivisions of this section. If, notwithstanding the
recovery of insurance proceeds by either party for loss, damage or destruction
of its property, the other party is liable to the first party with respect
thereto or is obligated under this Lease to make replacement, repair or
restoration or payment, then, provided the first party's right of full recovery
under its insurance policies is not thereby prejudiced or otherwise adversely
affected, the amount of the net proceeds of the first party's insurance against
such loss, damage or destruction shall be offset against the second party's
liability to the first party therefor, or shall be made available to the second
party to pay for replacement, repair or restoration, as the case may be. Nothing
contained in this section shall be deemed to relieve either party of any duty
imposed elsewhere in this Lease to repair, restore or rebuild provided for
elsewhere in this Lease.
9.5 Landlord may from time to time, but not more frequently than
once every three (3) years, require that the amount of comprehensive general
liability insurance to be maintained by Tenant under Section 9.3 or Section
6.1(6) (ii) be reasonably increased.
9.6 Landlord or its agents shall not be liable for any injury or
damage to persons or property resulting from fire, explosion, falling plaster,
steam, gas, electricity, water, rain or snow or leaks from any part of the
Building Project, or from the pipes, appliances or plumbing works or from the
roof, street or subsurface or from any other place or by dampness or by any
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other cause of whatsoever nature, unless any of the foregoing shall be caused by
or due to the negligence of Landlord.
9.7 Landlord or its agents shall not be liable for any damage which
Tenant may sustain if at any time any window of the demised premises is
temporarily closed, darkened or bricked up for any reason whatsoever, or
permanently closed, darkened or bricked up to comply with Legal Requirements or
the requirements of Landlord's insurers, and Tenant shall not be entitled to any
compensation therefor or abatement of rent or to any release from any of
Tenant's obligations under this Lease, nor shall the same constitute an
eviction.
9.8 Except as provided in Section 9.4 hereof, Tenant shall reimburse
Landlord for all damages, fines or reasonable expenses incurred or suffered by
Landlord, by reason of any breach, violation or non-performance by Tenant, or
its agents, servants or employees, of any covenant or provision of this Lease,
or by reason of damage to persons or property caused by moving property of or
for Tenant in or out of the A/B Building, or by the installation or removal of
furniture or other property of or for Tenant except as provided in Section 6.5
of this Lease, or by reason of or arising out of the carelessness, negligence or
improper conduct of Tenant, or its agents, servants or employees, in the use or
occupancy of the demised premises. Subject to the provisions of Section 8.2
hereof, where applicable, Tenant shall have the right, at Tenant's own cost and
expense, to participate in the defense of any action or proceeding brought
against Landlord, and in negotiations for settlement thereof if, pursuant to
this Section 9.8, Tenant would be obligated to reimburse Landlord for damages,
fines or reasonable expenses incurred or suffered by Landlord.
9.9 Tenant shall give Landlord notice in case of fire or accidents
in the demised premises promptly after Tenant is aware of such event.
ARTICLE 10
LANDLORD'S LIABILITY
10.1 Tenant agrees to look solely to Landlord's estate and interest
in the Building Project, or the proceeds from the sale thereof for the
satisfaction of any right or remedy of Tenant for the collection of a judgment
(or other judicial process) requiring the payment of money by Landlord, in the
event of any liability by Landlord hereunder, and no other property or assets of
Landlord shall be subject to levy, execution, attachment, or other enforcement
procedure for the satisfaction of Tenant's remedies under or with respect to
this Lease, the
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relationship of Landlord and Tenant hereunder, or Tenant's use and occupancy of
the demised premises, or any other liability of Landlord to Tenant hereunder.
Landlord represents that it is the record owner of the A/B Building. Neither the
partners constituting Landlord (the "Partners"), nor the partners, shareholders,
directors or officers of Landlord or the Partners shall be liable for the
performance of Landlord's obligations under this Lease.
ARTICLE 11
ASSIGNMENT, MORTGAGING, SUBLETTING, ETC.
11.1 Subject to the provisions of Section 11.2 hereof Tenant shall
not (a) assign or otherwise transfer this Lease or any interest herein, or the
term and estate hereby granted, (b) sublet the demised premises or any part
thereof or allow the same to be used or occupied by others, (c) mortgage, pledge
or encumber this Lease or the demised premises or any part thereof in any manner
by reason of any act or omission on the part of Tenant, or (d) advertise, or
authorize a broker to advertise, for a subtenant or an assignee at a
consideration or at rental rates below the rental rates then being advertised by
Landlord as its rental rates for comparable space in the Building Project and
for a comparable term, without, in each instance, obtaining the prior written
consent of Landlord, except as otherwise expressly provided in this Article 11,
which consent shall not be unreasonably withheld by Landlord. For purposes of
this Article 11, (i) the transfer of a majority of the issued and outstanding
capital stock of any corporate tenant, or of a corporate subtenant, or the
transfer of a majority of the total interest in any partnership tenant or
subtenant, however accomplished, whether in a single transaction or in a series
of related or unrelated transactions, shall be deemed an assignment of this
Lease, or of such sublease, as the case may be, if the primary purpose thereof
is to effectuate a transfer of this Lease, and (ii) a lease takeover agreement
shall be deemed a transfer of this Lease.
11.2 The consent of Landlord shall not be required for an assignment
or sublease of all or any portion of the demised premises to (i) a corporation
into or with which Tenant is merged or consolidated, (ii) an entity to which
substantially all of Tenant's shares or assets are transferred (provided such
merger or transfer of shares or assets is not principally for the purpose of
transferring the leasehold estate created hereby, and provided further, that the
assignee has a net worth at least equal to or in excess of the net worth of
Tenant immediately prior to such merger or transfer) or, (iii) if Tenant is a
partnership, with a successor partnership, nor shall the provisions of clauses
(a) and (b) of Section 11.1 apply to
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transactions with an entity (hereinafter called an "Affiliate") which controls
or is controlled by Tenant or is under common control with Tenant during the
period it remains an Affiliate. Furthermore, an Affiliate of Tenant shall be
permitted to occupy the demised premises but only during such period as it shall
remain an Affiliate.
11.3 Any assignment or transfer, whether made with Landlord's
consent as required by Section 11.1 or without Landlord's consent pursuant to
Section 11.2, shall not be effective hereunder until, the assignee shall
execute, acknowledge and deliver to Landlord a recordable agreement, in form and
substance reasonably satisfactory to Landlord, whereby the assignee shall assume
the obligations and performance of this Lease from and after the date of such
assignment and agree to be personally bound by and upon all of the covenants,
agreements, terms, provisions and conditions hereof on the part of Tenant to be
performed or observed and whereby the assignee shall agree that the provisions
of Section 11.1 hereof shall, notwithstanding such an assignment or transfer,
continue to be binding upon it in the future. Tenant covenants that,
notwithstanding any assignment or transfer, whether or not in violation of the
provisions of this Lease, and notwithstanding the acceptance of fixed annual
rent by Landlord from an assignee or transferee or any other party, Tenant
shall remain fully and primarily liable for the payment of the fixed annual rent
and additional rent due and to become due under this Lease and for the
performance of all of the covenants, agreements, terms, provisions and
conditions of this Lease on the part of Tenant to be performed or observed.
11.4 (a) Except for an assignment or sublease pursuant to Section
11.2 hereof, or pursuant to the last sentence of Section 11.1, if Tenant agrees
to enter into an assignment of this Lease or a sublease to sublet the demised
premises or any portion thereof, Tenant shall, as soon as that agreement is
consummated, but no less than forty-five (45) days prior to the effective date
of the contemplated assignment or sublease, deliver to Landlord an executed
counterpart of the proposed assignment or sublease, and Landlord shall then have
the right to elect, by notifying Tenant within thirty (30) days of such
delivery, to (i) in the case of an assignment of this Lease, accept an
assignment of this Lease from Tenant, and Tenant shall then promptly execute and
deliver to Landlord or entity affiliated with Landlord, in form reasonably
satisfactory to Landlord's counsel, an assignment on the terms reflected in the
proposed assignment, which assignment shall be effective as of such effective
date and shall relieve Tenant of further liability accruing under this Lease
after such effective date as to such portion of the demised premises assigned to
Landlord or entity affiliated with Landlord, and (ii) accept a sublease from
Tenant of the portion of the demised premises affected by any such proposed
subletting or the entire demised premises in the case of
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a proposed subletting thereof, and Tenant shall then promptly execute and
deliver a sublease to Landlord or entity affiliated with Landlord, for the
duration of Tenant's proposed subletting, commencing with such effective date,
at the rental terms reflected in the proposed sublease. If an offer of sublease
to Landlord results in all or substantially all of the demised premises being
sublet for substantially all of the term of this Lease (i.e., the balance of the
term less one year or less), then Landlord shall have the option to extend the
term of the sublease being offered to it for the remainder of the term of this
Lease less one day.
(b) If Landlord should elect to have Tenant execute and deliver a
sublease pursuant to any of the provisions of this Section 11.4, said sublease
shall be in a form reasonably satisfactory to Landlord's and Tenant's counsel
and on all the terms contained in this Lease, except that:
(i) The rental terms shall be as provided in subsection 11.4(a)
hereof,
(ii) The sublease shall not provide for any work to be done for the
subtenant or for any initial rent concessions or contain provisions
inapplicable to a sublease, except that in the case of a subletting of a
portion of the demised premises, Tenant shall reimburse subtenant for the
cost of erecting such demising walls as are necessary to separate the
subleased premises from the remainder of the demised premises and to
provide access thereto, provided Tenant was obligated to perform such work
or reimburse the proposed subtenant for such work under the terms of the
proposed sublease,
(iii) The subtenant thereunder shall have the right to underlet the
subleased premises, in whole or in part, without Tenant's consent,
(iv) The subtenant thereunder shall have the right to make, or cause
to be made, any changes, alterations, decorations, additions and
improvements that such subtenant may desire or authorize,
(v) Such sublease shall expressly negate any intention that any
estate created by or under such sublease be merged with any other estate
held by either of the parties thereto,
(vi) Any consent required of Tenant, as lessor under that sublease,
shall be deemed granted if consent with respect thereto is granted by
Landlord,
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(vii) The use of the sublet premises by the subtenant shall be for
general, administrative and/or executive offices unless constructed for
another purpose by or for Tenant in which event Landlord may in addition
use it for such purpose,
(viii) Any failure of the subtenant thereunder to comply with the
provisions of said sublease, other than with respect to the payment of
rent to Tenant, shall not constitute a default thereunder or hereunder if
Landlord has consented to such non-compliance, unless such failure to
comply would cause a violation of law or would increase or extend the
liability of Tenant under this Lease,
(ix) Upon execution of such sublease, Tenant's obligations with
respect to vacating the demised premises and removing any changes,
alterations, decorations, additions or improvements made in the subleased
premises shall be limited to those which accrued and related to such as
were made prior to the effective date of the sublease, and
(x) Such sublease shall provide that at the expiration of the term
of such subletting Tenant will accept the space in the condition provided
for in the proposed sublease.
If Landlord should elect to have Tenant execute and deliver a
sublease pursuant to any of the provisions of this Section 11.4, Tenant shall be
excused from having to obtain Landlord's consent, as required by the terms of
this Lease, for changes, alterations, decorations, additions or improvements
desired by the Subtenant.
(c) If pursuant to the exercise of any of Landlord's options
pursuant to Section 11.4 hereof this Lease is terminated as to only a portion of
the demised premises, then the fixed annual rent payable hereunder and the
additional rent payable pursuant to Articles 3 and 4 hereof shall be adjusted in
proportion to the portion of the demised premises affected by such termination.
11.5 In the event that Landlord does not exercise the option
available to it pursuant to subsection 11.4(a) hereof, Landlord shall not
unreasonably withhold or delay its consent to an assignment of this Lease or a
proposed subletting of the demised premises, as the case may be, by Tenant,
provided:
(a) Tenant shall have furnished Landlord with the name and business
address of the proposed subtenant or assignee, information with respect to its
intended use of the demised premises and the nature and character of the
proposed subtenant's or assignee's business, or activities, and, if Tenant is no
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longer the actual tenant of the demised premises, such reasonable references and
current financial information with respect to net worth, credit and financial
responsibility as are reasonably satisfactory to Landlord, and an executed
counterpart of the sublease or assignment agreement;
(b) the proposed subtenant or assignee is a reputable party whose
financial net worth, credit and financial responsibility is, considering the
responsibilities involved, satisfactory to Landlord;
(c) the proposed subtenant or assignee is not then an occupant of
any part of the Building Project or a party who is dealing with Landlord or
Landlord's agent (directly or through a broker) with respect to space then
available (or becoming available) in the Building Project; and
(d) each sublease shall specifically state that (i) it is subject to
all of the terms, covenants, agreements, provisions, and conditions of this
Lease, and (ii) the subtenant or assignee, as the case may be, will not have the
right to a further assignment thereof or sublease or assignment thereunder, or
to allow the demised premises to be used by others, without the prior reasonable
consent of Landlord in each instance.
With respect to clause (c) above, if Tenant informs Landlord that it
is commencing assignment or sublease negotiations with a party and inquires if
Landlord is also dealing with such party, Landlord shall disclose such
information to Tenant and Landlord agrees that, if Landlord is not dealing with
such disclosed party, as long as Tenant is continuously negotiating in good
faith with such disclosed party for the demised premises, Landlord will not
initiate negotiations with such party.
11.6 If Tenant defaults in the payment of any rent, Landlord is
authorized to collect any rents due or accruing from any assignee, subtenant or
other occupant of the demised premises and to apply the net amounts collected to
the fixed annual rent and additional rent reserved herein. The receipt by
Landlord of any amounts from an assignee or subtenant, or other occupant of any
part of the demised premises shall not be deemed or construed as releasing
Tenant from Tenant's obligations hereunder or the acceptance of that party as a
direct tenant.
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ARTICLE 12
ELECTRICITY
12.1 (a) Landlord shall supply electricity to the demised premises
in accordance with the provisions of this Section 12.1. For the purposes of this
Section 12.1, Landlord and Tenant agree that the term "Cost per Kilowatthour"
shall mean the total cost for electricity incurred by Landlord to service the
demised premises, as measured by the meter servicing that portion of the A/B
Building in which the demised premises are located, during a particular time
period (including all applicable surcharges, demand charges, energy charges,
fuel adjustment charges, time of day charges, taxes and other sums payable in
respect thereof) divided by the total kilowatthours purchased by Landlord during
such period.
(b) Electricity shall be supplied by Landlord to service the demised
premises and Tenant shall pay to Landlord, as additional rent, an amount
determined by applying the Cost per Kilowatthour to Tenant's consumption of and
demand for electricity within the demised premises as recorded on the submeter
or submeters servicing the demised premises. Where more than one meter measures
the electric service to Tenant, the electric service rendered through each meter
shall be computed and billed separately in accordance with the provisions
hereinafter set forth. Bills for the electricity additional rent shall be
rendered to Tenant at such time as Landlord may elect. If any tax is imposed
upon Landlord's receipts from the sale of electricity to Tenant by Federal,
State or municipal authority, Tenant agrees that, unless prohibited by law,
Tenant's proportionate share of such taxes shall be included in the bill of, and
paid by Tenant to, Landlord, as additional rent. Landlord's failure during the
term of this Lease to prepare and deliver any statements or bills under this
Article 12, or Landlord's failure to make a demand under this Article 12, or any
other provisions of this Lease shall not in any way be deemed to be a waiver of,
or cause Landlord to forfeit or surrender its rights to collect, any amount of
additional rent which may have become due pursuant to this Article 12 during the
term of this Lease. The actual costs incurred by Landlord for meter readings for
those meters that measure the electric service supplied to Tenant, and the costs
incurred by Landlord in the maintenance of such meters, shall be paid by Tenant
on demand, as additional rent. Tenant's liability for any amounts due under this
Article 12 shall survive the expiration or sooner termination of this Lease.
12.2 Notwithstanding the provisions of Section 12.1 above, at
Landlord's option, Tenant shall, within sixty (60) days after receiving notice
from Landlord, contract directly with the
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public utility furnishing electric current to the A/B Building for the supply,
at Tenant's cost, of all electric current to be used in the demised premises
including, without limitation, such as is required for the operation of any
supplemental heating, ventilating and air-conditioning system serving the
demised premises except that which is used in the operation of the "HVAC System"
(as that term is hereinafter defined in Section 21.1).
12.3 Tenant's use of electric current in the demised premises shall
not at any time exceed the capacity of any of the electrical conductors and
equipment in or otherwise serving the demised premises. Landlord represents that
the capacity of such electrical conductors and equipment is sufficient for
normal office uses. Tenant shall not make or perform, or permit the making or
performing of, any alterations to wiring, installations or other electrical
facilities in or serving the demised premises which would adversely affect
building systems in the A/B Building without the prior consent of the Landlord
in each instance. Should Landlord grant any such consent, all additional risers
or other equipment required therefor shall be installed by Landlord (after
advising Tenant of the estimated cost thereof and provided Tenant elects to have
Landlord proceed with such work) and the cost thereof shall be paid by Tenant
upon Landlord's demand, at which time Landlord shall provide Tenant with
complete documentation in regard to such costs, which such costs shall not
exceed what would be paid in an arm's-length transaction and any such
alterations shall be made in accordance with Article 6 thereof.
12.4 Landlord shall not be liable in any way to Tenant for any
failure or defect in the supply or character of electric energy furnished to the
demised premises by reason of any requirement, act or omission of the public
utility serving the A/B Building with electricity or for any other reason and
not attributable to Landlord.
12.5 If, at any time during the term of this Lease, Tenant wishes to
install in the demised premises equipment which would not be considered ordinary
office equipment, including, but not limited to, items such as computer
installation (other than a network of no more than 10 personal computers) or
supplemental air conditioning systems, or other heat or cooling-intensive
electrically operated equipment, Tenant shall submit to Landlord a list
indicating the specific type of additional equipment to be installed. Such list
shall include the number, type and model of each item of equipment to be
installed, as well as the manufacturer's electrical rating associated with same.
If, in Landlord's reasonable judgment the operation of such equipment will
impair the proper operation of the plumbing, heating, ventilation or air
conditioning systems for the A/B Building, as a condition to the installation of
such equipment, Tenant shall reimburse Landlord for Landlord's additional cost
incurred, as a
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result of such equipment installation and operation, in connection with the
proper function of such systems.
ARTICLE 13
DAMAGE BY FIRE OR OTHER CAUSE
13.1 If the A/B Building or the demised premises shall be partially
or totally damaged or destroyed by fire or other cause, within forty-five (45)
days after Landlord has had knowledge of such damage, Landlord shall deliver to
Tenant an estimate prepared by a reputable contractor selected by Landlord
setting forth such contractor's estimate as to the reasonable time required to
repair such damage. If the time period set forth in such estimate exceeds one
hundred eighty (180) days, Tenant may elect to terminate this Lease by notice to
Landlord not later than fifteen (15) days following the delivery of such
estimate to Tenant. If Tenant makes such election, the Term shall expire upon
the twentieth (20th) day after notice of such election is given by Tenant and
Tenant shall vacate the demised premises and surrender the same to Landlord.
Upon such termination, Tenant's liability for fixed annual rent and additional
rent shall cease as of the day following such damage and any prepaid portion
thereof for any period after such date shall be refunded by Landlord to Tenant.
If (x) the estimate does not exceed one hundred eighty (180) days, or (y) Tenant
fails to make its election as set forth hereinabove in this paragraph, and if
Landlord does not make the election under Section 13.3 (if applicable), Landlord
shall repair the damage and restore and rebuild the A/B Building and/or the
demised premises, at its expense (without limiting the rights of Landlord under
any other provisions of this Lease); provided, however, that Landlord shall not
be required to repair or replace any of Tenant's property. The provisions of
Article 34 shall not apply to the provisions of this Article 13.
13.2 If the A/B Building or the demised premises shall be partially
damaged or partially destroyed by fire or other cause, the fixed annual rent and
additional rent payable hereunder shall be abated to the extent that the demised
premises shall have been rendered untenantable for the period from the date of
such damage or destruction to the date the damage shall be repaired or restored.
If the demised premises or a major part thereof shall be totally (which shall be
deemed to include substantially totally) damaged or destroyed or rendered
completely (which shall be deemed to include substantially completely)
untenantable on account of fire or other cause, the fixed annual rent and
additional rent shall abate as of the date of the damage or destruction and
until Landlord shall repair, restore and rebuild the Building and the demised
premises;
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provided, however, that should Tenant reoccupy a portion of the demised premises
during the period the restoration work is taking place and prior to the date
that the same are made completely tenantable, rents allocable to such portion
shall be payable by Tenant from the date of such occupancy.
13.3 If the Building or the demised premises shall be totally
damaged or destroyed by fire or other cause, or if the Building shall be so
damaged or destroyed by fire or other cause (whether or not the demised premises
are damaged or destroyed) as to require a reasonably estimated expenditure of
more than forty percent (40%) of the full replacement value of the Building
immediately prior to the casualty, then in either such case Landlord may
terminate this Lease by giving Tenant notice to such effect within forty-five
(45) days after the date of the casualty.
13.4 No damages, compensation or claim shall be payable by Landlord
for inconvenience, loss of business or annoyance arising from any repair or
restoration of any portion of the demised premises or of the Building pursuant
to this Article 13. Landlord shall exercise reasonable diligence in the making
of any repairs, alterations, additions or improvements so as to minimize any
interference with Tenant's business operations, but shall not be required to
perform the same on an overtime or premium pay basis.
13.5 Notwithstanding any of the foregoing provisions of this Article
13, if Landlord or the lessor of any superior lease or the holder of any
superior mortgage shall be unable to collect all of the insurance proceeds
(including rent insurance proceeds) applicable to damage or destruction of the
demised premises or the Building by fire or other cause, by reason of some
action or inaction on the part of Tenant or any of its employees, agents or
contractors, then, without prejudice to any other remedies which may be
available against Tenant, there shall be no abatement of Tenant's rents, but the
total amount of such rents not abated (which would otherwise have been abated)
shall not exceed the amount of uncollected insurance proceeds.
13.6 Landlord will not carry separate insurance of any kind on
Tenant's property, and, except as provided by law or by reason of its breach of
any of its obligations hereunder, shall not be obligated to repair any damage
thereto or replace the same. Tenant shall maintain insurance on Tenant's
property and Landlord shall not be obligated to repair any damage thereto or
replace the same.
13.7 The provisions of this Article 13 shall be considered an
express agreement governing any cause of damage or destruction of the demised
premises by fire or other casualty, and no statute, rule, law or regulation of
the State of New York
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or any of its political subdivisions now or hereafter in force and providing for
such a contingency in the absence of an express agreement (including without
limitation Section 227 of the Real Property Law), shall have application in such
case.
ARTICLE 14
CONDEMNATION
14.1 In the event that the whole of the demised premises shall be
lawfully condemned or taken in any manner for any public or quasi-public use,
this Lease and the term and estate hereby granted shall forthwith cease and
terminate as of the earlier of the date of (i) vesting of title, (ii) Landlord's
agreement in lieu of condemnation or (iii) the issuance of a court order of
condemnation (any such date, the "Condemnation Date"). In the event that only a
part of the demised premises shall be so condemned or taken, then, effective as
of the Condemnation Date, the fixed annual rent under Article 1 hereunder and
additional rents under Articles 3 and 4 hereunder shall be abated in an amount
thereof apportioned according to the area of the demised premises so condemned
or taken. In the event that only a part of the Building Project (as such term is
defined in subsection 3.2(i) hereof) shall be so condemned or taken, then (a)
Landlord (whether or not the demised premises be affected) may, at Landlord's
option, terminate this Lease and the term and estate hereby granted as of the
Condemnation Date by notifying Tenant in writing of such termination within
sixty (60) days following the date on which Landlord shall have received notice
of vesting of title, or (b) if such condemnation or taking shall be of fifteen
(15%) or more of the demised premises or of a substantial part of the means of
access thereto or in Tenant's reasonable determination causes the demised
premises to be unable to be used by Tenant for the purposes contemplated herein,
Tenant may, at Tenant's option, by delivery of notice in writing to Landlord
within thirty (30) days following the date on which Tenant shall have received
notice of the Condemnation Date, terminate this Lease and the term and estate
hereby granted as of the date occurring sixty (60) days after the Condemnation
Date, or (c) if neither Landlord nor Tenant elects to terminate this Lease, as
aforesaid, this Lease shall be and remain unaffected by such condemnation or
taking, except that the fixed annual rent payable under Article 1 and additional
rents payable under Articles 3 and 4 shall be abated to the extent hereinbefore
provided. In the event that only a part of the demised premises shall be so
condemned or taken and this Lease and the term and estate hereby granted with
respect to the remaining portion of the demised premises are not terminated as
hereinbefore provided, Landlord will, with reasonable diligence and at its
expense, restore the remaining portion of the demised premises as nearly
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as practicable to the same condition as it was in prior to such condemnation or
taking.
14.2 In the event of its termination in any of the cases
hereinbefore provided, this Lease and the term and estate hereby granted shall
expire as of the date of such termination with the same effect as if that were
the Expiration Date, and the fixed annual rent and additional rents payable
hereunder shall be apportioned as of such date.
14.3 In the event of any condemnation or taking hereinbefore
mentioned of all or a part of the Building Project, Landlord shall be entitled
to receive the entire award in the condemnation proceeding, including any award
made for the value of the estate vested by this Lease in Tenant, and Tenant
hereby expressly assigns to Landlord any and all right, title and interest of
Tenant now or hereafter arising in or to any such award or any part thereof, and
Tenant shall be entitled to receive no part of such award. Provided that
Landlord's award is not reduced by reason thereof, Tenant may apply for an award
for its moving expenses and trade fixtures.
14.4 If all or any portion of the demised premises is taken for a
limited period of time during the term of this Lease, this Lease shall remain in
full force and effect. Tenant shall be entitled to receive the entire award made
in connection with any such temporary taking attributable to the demised
premises and for the term of this Lease. Any temporary taking of all or any
portion of the demised premises which continues for three (3) months shall be
deemed a permanent taking of the demised premises or subject portion. To the
extent that it affects the term of this Lease and provided Tenant uses counsel
reasonably satisfactory to Landlord, Tenant may contest such taking.
ARTICLE 15
ACCESS TO DEMISED PREMISES; CHANGES
15.1 Tenant shall permit Landlord to erect, use and maintain pipes,
ducts and conduits in and through the demised premises, provided the same are
installed adjacent to or concealed behind walls and ceilings of the demised
premises. Landlord shall to the extent practicable install such pipes, ducts and
conduits by such methods and at such locations as will not materially interfere
with or impair Tenant's layout or use of the demised premises. Landlord or its
agents or designees, on reasonable notice to Tenant except in the case of
emergency, shall have the right to enter the demised premises, at reasonable
times during business hours, for the making of such repairs or alterations as
Landlord may reasonably deem necessary for the A/B
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Building or which Landlord shall be required to or shall have the right to make
by the provisions of this Lease or any other lease in the A/B Building and,
subject to the foregoing, shall also have the right to enter the demised
premises for the purpose of inspecting them or exhibiting them to prospective
purchasers or lessees of the entire A/B Building or to prospective mortgagees of
the fee or of the Landlord's interest in the property of which the demised
premises are a part or to prospective assignees of any such mortgages or to the
holder of any mortgage on the Landlord's interest in the property, its agents or
designees. Landlord shall exercise reasonable diligence so as to minimize the
disturbance, but nothing contained herein shall be deemed to require Landlord to
perform the same on an overtime or premium pay basis.
15.2 Landlord reserves the right, without the same constituting an
eviction and without incurring liability to Tenant therefor, to change the
arrangement and/or location of public entrances, passageways, doors, doorways,
corridors, possible elevators, stairways, toilets and other public parts of the
A/B Building; provided, however, that access to the A/B Building shall not be
cut off and there shall be no unreasonable obstruction of access to the demised
premises or unreasonable interference with the use or enjoyment thereof.
15.3 In connection with any work performed by Landlord in accordance
with the provisions of this Article 15, upon the completion of such work,
Landlord will restore as closely as reasonably possible any improvements located
on the demised premises to the condition of such improvements prior to the
commencement of such work by Landlord; provided, however, nothing contained in
this paragraph is meant to (i) limit in any way Landlord's rights to perform any
work or repairs permitted to be performed by this Article 15 or (ii) require the
use of labor on an overtime or premium pay basis to perform such restoration
work on the improvements located on the demised premises.
15.4 Landlord may, during the six (6) months prior to expiration of
the term of this Lease, exhibit the demised premises to prospective tenants
during normal business hours upon reasonable advance notice to Tenant.
15.5 If Tenant shall not be personally present to open and permit an
entry into the demised premises at any time when for any reason an entry therein
shall be urgently necessary by reason of fire or other emergency, Landlord or
Landlord's agents may forcibly enter the same without rendering Landlord or such
agents' liable therefor (if during such entry Landlord or Landlord's agents
shall accord reasonable care to Tenant's property) and without in any manner
affecting the obligations and covenants of this Lease.
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ARTICLE 16
DEFAULT
16.1 This Lease and the term and estate hereby granted are subject
to the limitation that whenever Tenant shall make an assignment of the property
of Tenant for the benefit of creditors, or shall file a voluntary petition under
any bankruptcy or insolvency law or any involuntary petition alleging an act of
bankruptcy or insolvency shall be filed against Tenant under any bankruptcy or
insolvency law, or whenever a petition shall be filed by or against Tenant under
the reorganization provisions of the United States Bankruptcy Act or under the
provisions of any law of like import, or whenever a petition shall be filed by
Tenant under the provisions of any law of like import, or whenever a permanent
receiver of Tenant or of or for the property of Tenant shall be appointed, then,
Landlord may, (a) at any time after receipt of notice of the occurrence of any
such event, and (b) if such event occurs without the acquiescence of Tenant, at
any time after the event continues for sixty (60) days, give Tenant a notice of
intention to end the term of this Lease at the expiration of five (5) days from
the date of service of such notice of intention, and upon the expiration of said
five (5) day period, this Lease and the term and estate hereby granted, whether
or not the term shall theretofore have commenced, shall terminate with the same
effect as if that day were the Expiration Date, but Tenant shall remain liable
for damages as provided in Article 18.
16.2 This Lease and the term and estate hereby granted are subject
to further limitation as follows:
(a) whenever Tenant shall default in the payment of any installment
of fixed annual rent, or in the payment of any additional rent or any other
charge payable by Tenant to Landlord, on any day upon which the same ought to be
paid, or
(b) whenever Tenant shall do or permit anything to be done, whether
by action or inaction, contrary to any of Tenant's obligations hereunder other
than Tenant's obligations to pay fixed annual rent or additional rent or other
charges under this Lease, and if such situation shall continue and shall not be
remedied by Tenant within ten (10) days after Landlord shall have given to
Tenant a notice specifying the same, or, in the case of a happening or default
which cannot with due diligence be cured within a period of twenty (20) days and
the continuation of which for the period required for cure will not subject
Landlord to the risk of criminal liability (a more particularly described in
Article 8 hereof) or termination of any superior lease or foreclosure of any
superior mortgage, if Tenant shall not, (i) within said twenty (20) day period
advice Landlord of Tenant's
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intention to duly institute all steps necessary to remedy such situation, (ii)
duly institute within said twenty (20) day period, and thereafter diligently and
continuously prosecute to completion all steps necessary to remedy the same and
(iii) complete such remedy within such time after the date of the giving of said
notice of Landlord as shall reasonably be necessary; or
(c) whenever any event shall occur or any contingency shall arise
whereby this Lease or the estate hereby granted or the unexpired balance of the
term hereof would, by operation of law or otherwise, devolve upon or pass to any
person, firm or corporation other than Tenant, except as expressly permitted by
Article 11; or
(d) whenever Tenant shall abandon the demised premises (unless as a
result of a casualty) and such abandonment shall continue for twenty (20) days
after Landlord shall have given Tenant notice thereof; or
(e) whenever Tenant shall default in the due keeping, observing or
performance of any covenant, agreement, provision or condition of Article 5
hereof on the part of Tenant to be kept, observed or performed and if such
default shall continue and shall not be remedied by Tenant within five (5)
Business Days after Tenant receives a notice specifying the same;
then in any of said cases set forth in the foregoing subsections (a), (b), (c),
(d) and (e), Landlord may give to Tenant a notice of intention to end the term
of this Lease at the expiration of five (5) days from the date of the service of
such notice of intention, and upon the expiration of said three (3) days this
Lease and the term and estate hereby granted, whether or not the term shall
theretofore have commenced, shall terminate with the same effect as if that day
were the Expiration Date, but Tenant shall remain liable for damages as provided
in Article 18.
ARTICLE 17
RE-ENTRY BY LANDLORD, INJUNCTION
17.1 If Tenant shall default in the payment of any installment of
fixed annual rent, or of any additional rent or other charges under this Lease,
on any date upon which the same ought to be paid, and if such default shall
continue for five (5) days after Landlord shall have given to Tenant a notice
specifying such default, or if this Lease shall expire as in Article 16
provided, Landlord or Landlord's agents and employees may immediately or at any
time thereafter re-enter the demised premises, or any part thereof, either by
summary dispossess
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proceedings or by any suitable action or proceeding at law, without being liable
to indictment, prosecution or damages therefrom, to the end that Landlord may
have, hold and enjoy the demised premises again as and of its first estate and
interest therein. The word re-enter, as herein used, is not restricted to its
technical legal meaning. In the event of any termination of this Lease under the
provisions of Article 16 or if Landlord shall re-enter the demised premises
under the provisions of this Article 17 or in the event of the termination of
this Lease, or of re-entry, by or under any summary dispossess or other
proceedings or action by reason of default hereunder on the part of Tenant,
Tenant shall thereupon pay to Landlord the fixed annual rent and additional rent
payable by Tenant to Landlord up to the time of such termination of this Lease,
or of such recovery of possession of the demised premises by Landlord, as the
case may be, and shall also pay to Landlord damages as provided in Article 18.
17.2 In the event of a breach or threatened breach by Tenant of any
of its obligations under this Lease, Landlord shall also have the right of
injunction. The special remedies to which Landlord may resort hereunder are
cumulative and are not intended to be exclusive of any other remedies or means
of redress to which Landlord may lawfully be entitled at any time and Landlord
may invoke any remedy allowed at law or in equity as if specific remedies were
not provided for herein.
17.3 If this Lease shall terminate under the provisions of Article
16, or if Landlord shall re-enter the demised premises under the provisions of
this Article 17, or in the event of the termination of this Lease, or of
re-entry by or under any summary dispossess or other proceeding or action by
reason of default hereunder on the part of Tenant, Landlord shall be entitled to
retain all moneys, if any, paid by Tenant to Landlord, whether as advance rent,
security or otherwise, but such moneys shall be credited by Landlord against any
fixed annual rent or additional rent due from Tenant at the time of such
termination or re-entry or, at Landlord's option against any damages payable by
Tenant under Articles 16 and 18 or pursuant to law.
17.4 Tenant hereby expressly waives any and all rights of redemption
granted by or under any present or future laws in the event of Tenant being
evicted or dispossessed for any cause, or in the event of Landlord obtaining
possession of the demised premises, by reason of the violation by Tenant of any
of the covenants and conditions of this Lease or otherwise.
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ARTICLE 18
DAMAGES
18.1 If this Lease is terminated under the provisions of Article 16,
or if Landlord shall re-enter the demised premises under the provisions of
Article 17, or in the event of the termination of this Lease, or of re-entry, by
or under any summary dispossess or other proceeding or action by reason of
default hereunder on the part of Tenant, Tenant shall pay to landlord as
damages, at the election of Landlord, either
(a) a sum which at the time of such termination of this Lease or at
the time of any such re-entry by Landlord, as the case may be, represents the
present value (which present value shall be calculated at a discount rate equal
to the then legal rate of interest on judgments in New York State) of the
excess, if any, of
(1) the aggregate of the fixed annual rent and the additional rent
payable hereunder which would have been payable by Tenant (conclusively
presuming the additional rent to be the same as was payable for the year
immediately preceding such termination except that additional rent on
account of increases in Taxes and Expenses shall be presumed to increase
at the average of the rates of increase thereof previously experienced by
Landlord during the period (not to exceed three (3) years) prior to such
termination) for the period commencing with such earlier termination of
this Lease or the date of any such re-entry, as the case may be, and
ending with the Expiration Date, had this Lease not so terminated or had
Landlord not so re-entered the demised premises, over
(2) the aggregate rental value of the demised premises for the same
period, or
(b) sums equal to the fixed annual rent and the additional rent (as
above presumed) payable hereunder which would have been payable by Tenant had
this Lease not so terminated, or had Landlord not so re-entered the demised
premises, payable upon the due dates therefor specified herein following such
termination or re-entry and until the Expiration Date; provided, however, that
if Landlord shall re-let the demised premises during said period, Landlord shall
credit Tenant with the net rents received by Landlord from such re-letting, such
net rents to be determined by first deducting from the gross rents as and when
received by Landlord from such re-letting, the reasonable expenses incurred or
paid by Landlord in terminating this Lease or in re-entering the demised
premises and in securing possession thereof, as well as the reasonable expenses
of re-letting,
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including altering and preparing the demised premises for new tenants, brokers'
commissions comparable to those then being paid in similar transactions, and all
other reasonable expenses properly chargeable against the demised premises and
the rental thereof; it being understood that any such re-letting may be for a
period shorter or longer than the remaining term of this Lease; but in no event
shall Tenant be entitled to receive any excess of such net rents over the sums
payable by Tenant to Landlord hereunder, nor shall Tenant be entitled in any
suit for the collection of damages pursuant to this subsection to a credit in
respect of any net rents from a re-letting, except to the extent that such net
rents are actually received by Landlord. If the demised premises or any part
thereof should be re-let in combination with other space, then proper
apportionment on a square foot basis shall be made of the rent received from
such re-letting and of the expenses of re-letting.
If the demised premises or any part thereof be re-let by Landlord in an
arm's-length transaction for the unexpired portion of the term of this Lease, or
any part thereof, before presentation of proof of such damages to any court,
commission or tribunal, the amount of rent reserved upon such re-letting shall,
prima facie, be the fair and reasonable rental value for the demised premises,
or part thereof, so re-let during the term of the re-letting.
18.2 Suit or suits for the recovery of such damages, or any
installments thereof, may be brought by Landlord from time to time at its
election, and nothing contained herein shall be deemed to require Landlord to
postpone suit until the date when the term of this Lease would have expired if
it had not been so terminated under the provisions of Article 16, or under any
provision of law, or had Landlord not re-entered the demised premises. Nothing
herein contained shall be construed to limit or preclude recovery by Landlord
against Tenant of any sums or damages to which, in addition to the damages
particularly provided above, Landlord may lawfully be entitled by reason of any
default hereunder on the part of Tenant. Nothing herein contained shall be
construed to limit or prejudice the right of Landlord to prove for and obtain as
liquidated damages by reason of the termination of this Lease or re-entry of the
demised premises for the default of Tenant under this Lease, an amount equal to
the maximum allowed by any statute or rule of law in effect at the time when,
and governing the proceedings in which, such damages are to be proved whether or
not such amount be greater, equal to, or less than any of the sums referred to
in Section 18.1.
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ARTICLE 19
LANDLORD'S RIGHT TO PERFORM TENANT'S OBLIGATIONS
19.1 If Tenant shall default in the observance or performance of any
term or covenant on Tenant's part to be observed or performed under or by virtue
of any of the terms or provisions in any Article of this Lease, (a) Landlord may
remedy such default for the account of Tenant, immediately and without notice in
case of emergency, or in any other case only provided that Tenant shall fail to
remedy such default with all reasonable dispatch after Landlord shall have
notified Tenant in writing of such default and the applicable grace period for
curing such default shall have expired; and (b) if Landlord in good faith makes
any expenditures or incurs any obligations for the payment of money in
connection with such default including, but not limited to, reasonable
attorneys' fees in instituting, prosecuting or defending any action or
proceeding, such sums paid or obligations incurred, with interest at the
Interest Rate, shall be deemed to be additional rent hereunder and shall be paid
by Tenant to Landlord within thirty (30) days after rendition of a bill to
Tenant therefor.
ARTICLE 20
QUIET ENJOYMENT
20.1 Landlord covenants and agrees that subject to the terms and
provisions of this Lease, if, and so long as, Tenant keeps and performs each and
every covenant, agreement, term, provision and condition herein contained on the
part or on behalf of Tenant to be kept or performed, then Tenant's rights under
this Lease shall not be cut off or ended before the expiration of the term of
this Lease, subject however to ground and underlying leases and mortgages which
affect this Lease (as provided in Article 25 hereof).
ARTICLE 21
SERVICES AND EQUIPMENT
21.1 Landlord shall, at its cost and expense:
(a) provide necessary elevator facilities during Business Hours (as
such term is defined in Article 22 hereof) and shall have at least one elevator
subject to call at all other times. At Landlord's option, the elevators shall be
operated by
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automatic control or by manual control, or by a combination of both of such
methods;
(b) maintain, keep in repair and provide the services of the
Building system air-conditioning, heating and ventilating system ("HVAC System")
installed by Landlord in accordance with the design criteria annexed hereto as
Exhibit E. The aforesaid systems will function when seasonably required during
Business Hours. The cooling season for the purposes of this Lease shall be May
15 through September 15 of each calendar year. Landlord shall have no
responsibility or liability for the ventilating conditions and/or temperature of
the demised premises during the hours or days Landlord is not required to
furnish heat, ventilation or air-conditioning pursuant to this subsection. In
any event, Tenant shall keep entirely unobstructed all the vents, intakes,
outlets and grilles, at all times and shall comply with and observe all
reasonable regulations and requirements prescribed by Landlord for the proper
functioning of the heating, ventilating and air-conditioning systems including
without limitation, the lowering and closing of venetian blinds in the demised
premises during daylight hours. In the event that Tenant shall require
air-conditioning, heating or ventilation at such times as same are not furnished
by Landlord, Tenant shall give Landlord reasonable advance notice of such
requirement and, if same is furnished by Landlord, Tenant agrees to pay the
Landlord's actual cost therefor as additional rent;
(c) provide cleaning and janitorial services on Business Days in
accordance with the specifications annexed hereto as Exhibit F; provided,
however, Tenant shall pay to Landlord on demand the costs incurred by Landlord
for (a) extra cleaning work in the demised premises required because of (i)
misuse or neglect on the part of Tenant or its employees or visitors, (ii) use
of portions of the demised premises for preparation, serving or consumption of
food or beverages (except for the kitchen area as described in Exhibit D-1),
data processing or reproducing operations, private lavatories or toilets or
other special purposes requiring greater or more difficult cleaning work than
office areas, (iii) unusual quantity of interior glass surfaces, (iv)
non-building standard materials or finishes installed by Tenant or at its
request, and (b) removal from the demised premises and the Building of so much
of any refuse and rubbish of Tenant as shall exceed that ordinarily accumulated
daily in the routine of business office occupancy. Landlord, its cleaning
contractor and their employees shall have access outside of Business Hours to
the demised premises and the use (at Tenant's expense) of light, power and water
in the demised premises as reasonably required for the purpose of cleaning the
demised premises in accordance with Landlord's obligations hereunder; and
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(d) furnish hot and cold water for lavatory and office cleaning
purposes and cold water for drinking purposes. If Tenant requires, uses or
consumes water for any other purposes, Tenant agrees to Landlord installing a
meter or meters or other means to measure Tenant's water consumption, and Tenant
further agrees to reimburse Landlord for the cost of the meter or meters and the
installation thereof, and to pay for the maintenance of said meter equipment
and/or to pay Landlord's cost of other means of measuring such water consumption
by Tenant. Tenant shall reimburse Landlord for the cost of all water consumed,
as measured by said meter or meters or as otherwise measured, including, without
limitation, sewer rents.
21.2 Landlord reserves the right to stop the heating,
air-conditioning, elevator, plumbing, electric and other systems when necessary
by reason of accident or emergency or for repairs, alterations, replacements or
improvements, provided that except in case of emergency, Landlord will notify
Tenant in advance of any such stoppage and its estimated duration, and will
proceed diligently with the work necessary to resume such service as promptly as
possible and in a manner so as to minimize interference with the Tenant's use
and enjoyment of the demised premises but nothing herein shall be deemed to
require Landlord to perform the same on an overtime or premium pay basis unless
requested to do so by, and at the expense of, Tenant.
21.3 Tenant shall reimburse Landlord for the cost to Landlord of
removal from the demised premises and the Building of so much of any refuse and
rubbish of Tenant as shall exceed that ordinarily accumulated daily in the
routine of business office occupancy.
21.4 It is expressly agreed that only Landlord or any one or more
persons, firms or corporations authorized in writing by Landlord will be
permitted to furnish laundry, linen towels, drinking water, ice, food or
beverages and other similar supplies and services to tenants and licensees in
the Building provided the quality thereof and the charges therefor are
reasonably comparable to that of other suppliers of such services.
Notwithstanding the foregoing, Landlord agrees that, in connection with meetings
held at the demised premises in the ordinary course of Tenant's business, Tenant
shall have the right to hire an independent caterer, provided that such caterer,
its employees and agents comply with all the regulations set forth in this Lease
with respect to the delivery of goods to the demised premises and the
preparation and service of food at the demised premises. Landlord may fix, in
its own absolute discretion, at any time and from time to time, the hours during
which and the regulations under which such supplies and services are to be
furnished. Landlord expressly reserves the right to act as or to designate, at
any time and from time to time, an exclusive supplier of all or any one or more
of the said supplies and
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services, provided that the quality thereof and the charges therefor are
reasonably comparable to that of other suppliers; and Landlord furthermore
expressly reserves the right to exclude from the Building any person, firm or
corporation attempting to furnish any of said supplies or services but not so
designated by Landlord. It is understood, however, that Tenant or regular office
employees of Tenant who are not employed by any supplier of such food or
beverages or by any person, firm or corporation engaged in the business of
purveying such food or beverages, may personally bring food or beverages into
the Building for consumption within the demised premises by employees of Tenant,
but not for resale to or for consumption by any other tenant.
21.5 Tenant agrees to employ such office maintenance contractor as
Landlord may from time to time designate, for all waxing, polishing, lamp
replacement, cleaning (other than those cleaning services Landlord is obligated
to furnish on an as-needed basis) and the maintenance work in the demised
premises, provided that the quality thereof and the charges therefor are
reasonably comparable to that of other contractors. Tenant shall not employ any
other contractor without Landlord's prior written consent, which consent shall
not be unreasonably withheld or delayed.
21.6 Landlord will, at the request of Tenant, maintain listings on
the Building directory of the names of Tenant and any other person, firm,
association or corporation in occupancy of the demised premises or any part
thereof as permitted hereunder, and the names of any officers or employees of
any of the foregoing; provided, however, that the number of names so listed
shall be in the same proportion to the capacity of the Building directory as the
aggregate number of square feet of rentable area of the demised premises is to
the aggregate number of square feet of rentable area of the Building. The
listing of any name other than that of the Tenant, whether on the doors of the
demised premises, on the Building directory, or otherwise, shall not operate to
vest any right or interest in this Lease or in the demised premises or to be
deemed to be the written consent of Landlord mentioned in Article 11 hereof, it
being expressly understood that any such listing is a privilege extended by
Landlord revocable at will by written notice to Tenant.
21.7 Landlord will not be required to furnish any other services,
except as otherwise provided in this Lease.
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ARTICLE 22
DEFINITIONS
22.1 The term "Landlord" as used in this Lease means only the owner,
or the mortgagee in possession, for the time being of the Land and A/B Building
or the Building Project (or the owner of a lease of the Building Project or the
A/B Building or of the Land and A/B Building), so that in the event of any
transfer of title to the Building Project or said Land and Building or said
lease, or in the event of a lease of the Building Project or the A/B Building,
or of the Land and A/B Building, upon notification to Tenant of such transfer or
lease the said transferor Landlord shall be and hereby is entirely freed and
relieved of all future covenants, obligations and liabilities of Landlord
hereunder, and it shall be deemed and construed as a covenant running with the
land without further agreement between the parties or their successors in
interest, or between the parties and the transferee of title to the Building
Project or said Land and A/B Building or said lease, or the said lessee of the
Building Project or the Building, or of the Land and Building, that the
transferee or the lessee has assumed and agreed to carry out any and all such
covenants, obligations and liabilities of Landlord hereunder.
22.2 The term "Business Days" as used in this Lease shall exclude
Saturdays, Sundays and the following holidays: New Year's Day, Good Friday,
Memorial Day, Independence Day, Labor Day, President's Day, Thanksgiving Day and
the immediately following day, Christmas Day, and all other days recognized as
holidays under applicable union contracts.
22.3 "Interest Rate" shall mean a rate per annum equal to the lesser
of (a) two percent (2%) above the commercial lending rate announced from time to
time by Manufacturers Hanover Trust Company, as its prime rate (the "Prime
Rate") for 90-day unsecured loans, or (b) the maximum applicable legal rate, if
any.
22.4 "Legal Requirements" shall mean laws, statutes and ordinances
(including building codes and zoning regulations and ordinances) and the orders,
rules, regulations, directives and requirements of all federal, state, county,
city and borough departments, bureaus, boards, agencies, offices, commissions
and other subdivisions thereof, or of any official thereof, or of any other
governmental public or quasi-public authority, whether now or hereafter in
force, which may be applicable to the Building Project, the Land or A/B Building
or the demised premises or any part thereof, or the sidewalks, curbs or areas
adjacent thereto (including, without limitation, the Common Areas) and all
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requirements, obligations and conditions of all instruments of record on the
date of this Lease.
22.5 "Business Hours" shall mean 8:00 A.M. to 6:00 P.M. on Business
Days.
ARTICLE 23
INVALIDITY OF ANY PROVISION
23.1 If any term, covenant, condition or provision of this Lease or
the application thereof to any circumstance or to any person, firm or
corporation shall be invalid or unenforceable to any extent, the remaining
terms, covenants, conditions and provisions of this Lease or the application
thereof to any circumstances or to any person, firm or corporation other than
those as to which any term, covenant, condition or provision is held invalid or
unenforceable, shall not be affected thereby, and each remaining term, covenant,
condition and provision of this Lease shall be valid and shall be enforceable to
the fullest extent permitted by law.
ARTICLE 24
BROKERAGE
24.1 Landlord and Tenant each covenant, represent and warrant that
it has had no dealings or communications with any broker or agent in connection
with the consummation of this Lease other than Rostenberg-Doern Company, Inc.
and Benson Commercial Realty, Inc., and each covenants and agrees to pay, hold
harmless and indemnify the other from and against any and all cost, expense
(including reasonable attorneys' fees) or liability for any compensation,
commissions or charges claimed by any other broker or agent with whom the
indemnifying party dealt with respect to this Lease or the negotiation thereof.
Landlord will pay any commission earned by Rostenberg-Doern Company, Inc. and
Benson Commercial Realty, Inc. pursuant to the terms of a separate agreement.
ARTICLE 25
SUBORDINATION
25.1 This Lease is and shall be subject and subordinate to all
ground or underlying leases which may now or
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hereafter affect the real property of which the demised premises form a part and
to all mortgages which may now or hereafter affect such leases or such real
property, and to all renewals, modifications, replacements and extensions
thereof. The provisions of this Section 25.1 shall be self-operative and no
further instrument of subordination shall be required. In confirmation of such
subordination, Tenant shall promptly execute and deliver at its own cost and
expense any instrument, in recordable form if required, that Landlord, the
lessor of the ground or underlying lease or the holder of any such mortgage or
any of their respective successors in interest may request to evidence such
subordination.
25.2 In the event of a termination of any ground or underlying
lease, 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, provided that Tenant shall have received a
non-disturbance agreement, as described in Section 25.4 hereof, in regard to the
lease or mortgage in question, and that Tenant has, in turn, fully executed and
delivered same to the appropriate party, Tenant under this Lease will, at the
option to be exercised in writing by the lessor under such ground or underlying
lease or such mortgagee or purchaser, assignee or lessee, as the case may be,
either (i) attorn to it and will perform for its benefit all the terms,
covenants and conditions of this Lease on Tenant's part to be performed with the
same force and effect as if said lessor, such mortgagee or purchaser, assignee
or lessee, were the landlord originally named in this Lease, or (ii) enter into
a new lease with said lessor or such mortgagee or purchaser, assignee or lessee,
as landlord, for the remaining term of this Lease and otherwise on the same
terms and conditions and with the same options, if any, then remaining. The
foregoing provisions of clause (i) of this Section 25.2 shall enure to the
benefit of such lessor, mortgagee, purchaser, assignee or lessee, shall be
self-operative upon the exercise of such option, and no further instrument shall
be required to give effect to said provisions. Tenant, however, upon demand of
any such lessor, mortgagee, purchaser, assignee or lessee agrees to execute,
from time to time, instruments in confirmation of the foregoing provisions of
this Section 25.2, reasonably satisfactory to any such lessor, mortgagee,
purchaser, assignee or lessee, acknowledging such subordination and attornment
and setting forth the terms and conditions of its tenancy. Tenant hereby
constitutes and appoints Landlord or its successors in interest to be the
Tenant's attorney-in-fact, irrevocably and coupled with an interest, to execute
and deliver such instrument of attornment, or such new lease, if Tenant refuses
or fails to do so promptly upon request.
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25.3 Anything herein contained to the contrary notwithstanding,
under no circumstances shall the aforedescribed lessor under the ground lease or
mortgagee or purchaser, assignee or lessee, as the case may be, whether or not
it shall have succeeded to the interests of the landlord under this Lease, be
(a) liable for any act, omission or default of any prior landlord so
long as such ground lessor or mortgagee shall not be a "related party" (as that
term is defined by the Internal Revenue Code), except under no circumstances
shall this be deemed a waiver of such default by Tenant; or
(b) subject to any offsets, claims or defenses which the Tenant
might have against any prior landlord; or
(c) bound by any rent or additional rent which Tenant might have
paid to any prior landlord for more than one (1) month in advance (except for
any excess payments contemplated pursuant to Sections 3.3 and 4.9 hereof) or for
more than three (3) months in advance where such rent payments are payable at
intervals of more than one (1) month; or
(d) provided such aforedescribed lessor under the ground lease or
mortgagee or purchaser, assignee or lessee, as the case may be, has delivered to
Tenant a non-disturbance agreement, as described in Section 25.4 hereof, in
regard to the lease or mortgage in question and that Tenant has, in turn, fully
executed and delivered same to the appropriate party, bound by any modification,
amendment or abridgment of the Lease, or any cancellation or surrender of the
same, made without its prior written approval.
25.4 On the date of this Lease there are no ground or underlying
leases and only one mortgage affecting the real property of which the demised
premises form a part. Landlord shall (i) deliver to Tenant, upon the execution
of this Lease, an agreement, in recordable form to the effect hereinbelow in
this Section 25.4 set forth, from the holder of such mortgage, and (ii) shall
obtain and deliver to Tenant, after the execution and delivery of any ground or
underlying lease or any superior mortgage other than the mortgage referred to in
clause (i) of this Section 25.4, an agreement to the effect hereinbelow in this
Section 25.4 set forth, executed by the holder of any such mortgage or by the
lessor under any such ground lease or underlying lease, as the case may be; each
of which agreements Tenant agrees to promptly execute and deliver. The
agreements referred to in the preceding sentence of this Section 25.4 shall be
on the mortgagee's or lessor's standard form and shall provide substantially
that so long as no default exists, nor any event has occurred, which has
continued to exist for such period of time (after notice and expiration of the
grace period, if any, required by this Lease) as would entitle Landlord to
dispossess
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Tenant, (a) Tenant shall not be joined as a party defendant in any foreclosure
action or proceeding which may be instituted or taken by the holder of any such
mortgage, by reason of any default under any such mortgage, (b) Tenant shall not
be evicted from the demised premises, (c) Tenant's leasehold estate hereunder
shall not be terminated or disturbed, and (d) none of Tenant's rights under this
Lease shall be affected in any way, by reason of any default under any such
mortgage, ground lease or underlying lease.
25.5 If, in connection with the financing of the A/B Building, the
holder of any mortgage shall request reasonable modifications in this Lease as a
condition of approval thereof, Tenant will not unreasonably withhold, delay or
defer making such modifications provided such modifications do not increase
Tenant's monetary obligations, change the Term, change the demised premises or
materially increase any other of Tenant's obligations or materially decrease
Tenant's rights under this Lease.
ARTICLE 26
CERTIFICATES OF LANDLORD AND TENANT
26.1 Tenant shall, without charge, at any time and from time to
time, within ten (10) days after request by Landlord, deliver a written
instrument to Landlord or any other person, firm or corporation specified by
Landlord, duly executed and acknowledged, certifying:
(a) that this Lease is unmodified and in full force and effect or,
if there has been any modification, that the same is in full force and effect as
modified and stating any such modification, whether there is any existing basis
to cancel or terminate this Lease, and whether to the best of Tenant's knowledge
Landlord is in default thereunder;
(b) that the term of this Lease has commenced and rent has become
payable thereunder, and that Tenant is in possession of all of the demised
premises;
(c) the amount of the fixed annual rent payable under this Lease and
the dates to which the fixed annual rent and additional rent and other charges
hereunder, have been paid; and
(d) whether or not Tenant has made any claim against Landlord under
this Lease and if so the nature thereof and the dollar amount, if any, of such
claim.
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26.2 Landlord agrees, at any time and from time to time, as
requested by Tenant, upon not less than ten (10) days prior notice, to execute
and deliver a statement certifying that this Lease is unmodified and in full
force and effect (or if there have been modifications that the same is in full
force as modified and stating the modifications), certifying the dates to which
the fixed rent and additional rent have been paid, and stating whether or not,
to the best knowledge of Landlord, Tenant is an default in performance of any of
his obligations under this Lease, and, if so, specifying each such default of
which Landlord may have knowledge.
26.3 Tenant agrees that, except for the first month's rent hereunder
and as specifically provided hereunder with respect to additional rent, it will
pay no rent under this Lease more than thirty (30) days in advance of its due
date, if so restricted by any existing or future ground lease or mortgage to
which this Lease is subordinated or by an assignment of this Lease to the ground
lessor or the holder of such mortgage, and, in the event of any act or omission
by Landlord, Tenant will not exercise any right to remedy the default until
Tenant shall have given written notice of such act or omission to the ground
lessor and to the holder of any mortgage on the fee or the ground lease who
shall have furnished such lessor's or holder's last address to Tenant, and until
a reasonable period for remedying such act or omission shall have elapsed
following the giving of such notices, during which time such lessor or holder
shall have the right, but shall not be obligated, to remedy or cause to be
remedied such act or omission.
ARTICLE 27
LEGAL PROCEEDINGS WAIVER OF JURY TRIAL
27.1 Landlord and Tenant do hereby waive trial by jury in any
action, proceeding or counterclaim brought by either of the parties hereto
against the other on any matters 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 demised premises, and/or any other claims (except claims for
personal injury or property damage) and any emergency statutory or any other
statutory remedy. It is further mutually agreed that in the event Landlord
commences any summary proceeding for non-payment of rent, Tenant will not
interpose and does hereby waive the right to interpose any counterclaim of
whatever nature or description in any such proceeding.
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ARTICLE 28
SURRENDER OF PREMISES
28.1 Upon the expiration or other termination of the term of this
Lease, Tenant shall quit and surrender to Landlord the demised premises, broom
clean, in good order and condition, ordinary wear and tear and damage by fire,
the elements or other casualty excepted, and Tenant shall remove all of its
property as herein provided. Tenant's obligation to observe or perform this
covenant shall survive the expiration or other termination of the term of this
Lease.
ARTICLE 29
RULES AND REGULATIONS
29.1 Tenant and Tenant's servants, employees and agents shall
observe faithfully and comply strictly with the Rules and Regulations set forth
in Exhibit G attached hereto and made part hereof entitled "Rules and
Regulations" and such other and further reasonable Rules and Regulations as
Landlord or Landlord's agents may from time to time adopt; provided, however,
that in case of any conflict or inconsistency between the provisions of this
Lease and of any of the Rules and Regulations as originally or as hereafter
adopted, the provisions of this Lease shall control. Reasonable written notice
of any additional Rules and Regulations shall be given to Tenant and any dispute
with respect to the reasonableness of any such additional Rules and Regulations
shall be resolved by arbitration in accordance with the provisions of Article 30
hereof. Landlord agrees that it shall not enforce or fail to enforce any of the
Rules and Regulations in a manner so as to apply the same in an unfairly
discriminatory manner with respect to Tenant.
Nothing in this Lease contained shall be construed to impose upon
Landlord any duty or obligation to enforce the Rules and Regulations or the
terms, covenants or conditions in any other lease, against any other tenant of
the Building, and Landlord shall not be liable to Tenant for violation of the
same by any other tenant, its servants, employees, agents, visitors or
licensees.
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ARTICLE 30
CONSENTS AND APPROVALS
30.1 Wherever in this Lease Landlord's consent or approval is
required, if Landlord shall delay or refuse such consent or approval, Tenant in
no event shall 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 unreasonably withheld or unreasonably delayed
its consent or approval. Tenant's sole remedy shall be an action or proceeding
to enforce any such provision, for specific performance, injunction or
declaratory judgment.
30.2 If Tenant desires to determine any dispute between Landlord and
Tenant as to the reasonableness of Landlord's decision to refuse to consent to
(i) any assignment or subletting in accordance with the provisions of Article 11
hereof, or (ii) any Alteration pursuant to the provisions of Article 2 or 6
hereof, such dispute shall be settled and finally determined by arbitration in
the City of New York in accordance with the Commercial Arbitration Rules of the
American Arbitration Association.
ARTICLE 31
NOTICES
31.1 Any notice or demand, consent, approval or disapproval, or
statement required to be given by the terms and provisions of this Lease, or by
any law or governmental regulation, either by Landlord to Tenant or by Tenant to
Landlord, shall be in writing. Unless otherwise required by such law or
regulation, such notice or demand shall be given, and shall be deemed to have
been served and given three (3) days after such notice or demand is mailed if
delivered by registered or certified mail deposited enclosed in a securely
closed postpaid wrapper, in a United States Government general or branch post
office, or official depository with the exclusive care and custody thereof, or
upon receipt if delivered to an overnight delivery service requiring a receipt,
addressed to Landlord or to Tenant, as the case may be, at its address set forth
on page one (1) of this Lease or if personally delivered. Until such time as
Tenant or anyone claiming under or through Tenant first occupies the demised
premises for the conduct of its business, all such notices and demands shall be
served or given to Tenant at the address for Tenant as set forth on the first
page of this Lease,
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and after such time all such notices and demands shall be served or given to
Tenant at the demised premises. Either party may, by notice as aforesaid,
designate a different address or addresses for notices, demands, consents,
approvals or disapprovals.
31.2 In addition to the foregoing, either Landlord or Tenant may,
from time to time, request in writing that the other party serve a copy of any
notice or demand, consent, approval or disapproval, or statement, on one other
person or entity designated in such request, such service to be effected as
provided in Section 31.1 hereof.
ARTICLE 32
NO WAIVER
32.1 No agreement to accept a surrender of this Lease shall be valid
unless in writing signed by Landlord. No employee of Landlord or of Landlord's
agents shall have any power to accept the keys of the demised premises prior to
the termination of this Lease. The delivery of keys to any employee of Landlord
or of Landlord's agent shall not operate as a termination of this Lease or a
surrender of the demised premises. In the event of Tenant at any time desiring
to have Landlord sublet the premises for Tenant's account, Landlord or
Landlord's agents are authorized to receive said keys for such purpose without
releasing Tenant from any of the obligations under this Lease. The failure of
Landlord to seek redress for violation of, or to, insist upon the strict
performance of, any covenant or condition of this Lease or any of the Rules and
Regulations set forth herein, or hereafter adopted by Landlord, shall not
prevent a subsequent act, which would have originally constituted a violation,
from having all the force and effect of an original violation. The receipt by
Landlord of rent with knowledge of the breach of any covenant of this Lease
shall not be deemed a waiver of such breach. The failure of Landlord to enforce
any of the Rules and Regulations set forth herein, or hereafter adopted, against
Tenant and/or any other tenant in the Building shall not be deemed a waiver of
any such Rules and Regulations. No provision of this Lease shall be deemed to
have been waived by Landlord, unless such waiver be in writing signed by
Landlord. No payment by Tenant or receipt by Landlord of a lesser amount than
the monthly rent herein stipulated shall be deemed to be other than on the
account of the earliest stipulated rent, nor shall any endorsement or statement
on any check or any letter accompanying any check or payment of rent be deemed
an accord and satisfaction, and Landlord may accept such check or payment
without prejudice to Landlord's right to recover the balance of such rent or
pursue any other remedy in this Lease provided.
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32.2 This Lease contains the entire agreement between the parties,
and any executory agreement hereafter made shall be ineffective to change,
modify, discharge or effect an abandonment of it in whole or in part unless such
executory agreement is in writing and signed by the party against whom
enforcement of the change, modification, discharge or abandonment is sought.
ARTICLE 33
CAPTIONS
33.1 The captions are inserted only as a matter of convenience and
for reference, and in no way define, limit or describe the scope of this Lease
nor the intent of any provision thereof.
ARTICLE 34
INABILITY TO PERFORM
34.1 If, by reason of (1) strike, (2) labor troubles not caused by
Landlord, (3) governmental pre-emption in connection with a national emergency,
(4) any rule, order or regulation of any governmental agency, (5) conditions of
supply or demand which are affected by war or other national, state or municipal
emergency or (6) any cause beyond Landlord's reasonable control, provided that
lack of funds shall not be deemed beyond Landlord's reasonable control Landlord
shall be unable to fulfill its obligations under this Lease or shall be unable
to supply any service which Landlord is obligated to supply, this Lease and
Tenant's obligation to pay rent hereunder shall in no wise be affected, impaired
or excused, except as provided in Sections 13.2 and 14.1.
ARTICLE 35
NO REPRESENTATIONS BY LANDLORD
35.1 Landlord or Landlord's agents have made no representations or
promises with respect to the Building or demised premises except as herein
expressly set forth.
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ARTICLE 36
NAME OF THE BUILDING PROJECT
36.1 Landlord shall have the full right at any time to name or
change the name of the Building Project or the Building and to change the
designated address of the Building Project or the Building.
ARTICLE 37
RESTRICTIONS UPON USE
37.1 It is expressly understood that no portion of the demised
premises shall be used as, by or for (i) a bank, trust company, savings bank,
industrial bank, savings and loan association or personal loan bank (or any
branch office or public accommodation office of any of the foregoing), or (ii) a
public stenographer or typist, barber shop, beauty shop, beauty parlor or shop,
telephone or telegraph agency, telephone or secretarial service, messenger
service, travel or tourist agency, employment agency, public restaurant or bar,
commercial document reproduction or offset printing service, public vending
machines, retail, wholesale or discount shop for sale of merchandise, retail
service shop, labor union, school or classroom, governmental or
quasi-governmental bureau, department or agency, including an autonomous
governmental corporation, an advertising agency, a firm whose principal business
is real estate brokerage, or a company engaged in the business of renting office
or desk space.
ARTICLE 38
INDEMNITY
38.1 Tenant shall indemnify, defend and save Landlord harmless from
and against any liability or expense arising from the use or occupation of the
demised premises by Tenant or anyone in the demised premises with Tenant's
permission, or from the breach of this Lease by Tenant.
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ARTICLE 39
SECURITY DEPOSIT
39.1 Tenant is not required to deposit any sums with Landlord as
security for its performance of the terms of this Lease.
ARTICLE 40
MISCELLANEOUS
40.1 Irrespective of the place of execution or performance, this
Lease shall be governed and construed in accordance with the laws of the State
of New York.
40.2 This Lease shall be construed without regard to any presumption
or other rule requiring construction against the party causing this Lease to be
drafted.
40.3 Except as otherwise expressly provided in this Lease, each
covenant, agreement, obligation or other provision of this Lease on Tenant's
part to be performed shall be deemed and construed as a separate and independent
covenant of Tenant, not dependent on any other provision of this Lease.
40.4 All terms and words used in this Lease, regardless of the
number or gender in which they are used, shall be deemed to include any other
number and any other gender as the context may require.
40.5 Time shall be of the essence with respect to the exercise of
any option granted under this Lease.
40.6 Except as otherwise provided herein whenever payment of
interest is required by the terms hereof it shall be at the Interest Rate.
40.7 In the event that Tenant is in arrears in payment of fixed
annual rent or additional rent hereunder, Tenant waives Tenant's right, if any,
to designate the items against which any payments made by Tenant are to be
credited, and Tenant agrees that Landlord may apply any payments made by Tenant
to any items it sees fit, irrespective of and notwithstanding any designation or
request by Tenant as to the items against which any such payments shall be
credited.
40.8 Landlord or Landlord's agents have made no representations or
promises with respect to the Building Project
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or the demised premises or except as herein expressly set forth and no rights,
easements or licenses are acquired by Tenant by implication or otherwise except
as expressly set forth herein. Landlord makes no representation as to the actual
rentable square foot area of the demised premises, the A/B Building, Building D
(where applicable), Building C or the other improvements at the Building
Project, except that Landlord represents that the method of measurement for the
demised premises is the same method of measurement used throughout the A/B
Building, Building D (where applicable) and Building C. Subject to the
performance by Landlord of Landlord's work pursuant to Exhibits D and D-1
hereof, (x) by the execution of this Lease, Tenant hereby accepts possession of
the demised premises in the condition in which it exists on the date hereof "as
is" and further agrees that, except as expressly provided in Article 2 and
Exhibit D, Landlord shall have no obligation to perform any work or make any
installations in order to prepare the demised premises for Tenant's occupancy
and (y) the execution of this Lease by Tenant shall be conclusive evidence as
against Tenant, that, on the date hereof, the demised premises and the Building
were in good and satisfactory condition, subject to the performance of Landlord
Work as provided in Exhibit D and Exhibit D-1 annexed hereto.
ARTICLE 41
COMMON AREAS AND PARKING
41.1 Landlord shall provide and shall make available from time to
time within the boundaries of the Land such parking facilities, driveways,
entrances and exits thereto, landscape and planted areas, and other improvements
and facilities, as Landlord shall at any time and from time to time deem
appropriate (all the foregoing being collectively referred to in this Lease as
"Common Areas"). Tenant and its officers, employees, agents, customers and
invitees shall have a nonexclusive right, in common with Landlord and other
tenants and occupants of the Building Project (and their employees and invitees)
and contractors working at the Building Project to whom Landlord has granted or
may hereafter grant rights, to use the Common Areas. The Common Areas shall at
all times be subject to the exclusive control and management of Landlord, and
Landlord shall have the right from time to time to establish, modify and enforce
reasonable rules and regulations with respect to the Common Areas, and Tenant
agrees, after notice thereof, to abide by such rules and regulations and to
cause its officers, employees, agents, customers and invitees to conform
thereto. Landlord shall construct, operate, manage, equip, repair, landscape,
and maintain the Common Areas for their intended purposes in such manner as
Landlord shall, in Landlord's sole discretion, from time to time determine.
Landlord's rights
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respecting the Common Areas shall include (but shall not be limited to) the
following:
(i) to construct, maintain and operate lighting facilities serving
the Common Areas;
(ii) from time to time to change the area, level, location and
arrangement of parking areas and other Common Area facilities, to make
installations therein and to move or remove such installations, and to
change the location of, or permanently diminish or discontinue the use of,
any portion of the Common Areas provided the number of parking spaces
available for Tenant's use shall not be materially reduced;
(iii) to restrict parking by tenants, their officers, agents,
employees, customers and invitees, to designated areas, provided, however,
if Landlord decides to designate certain parking areas, four (4) parking
spaces in reasonably close proximity to the entrance to Building B shall
be designated for Tenant's use;
(iv) to discontinue, or restrict the use of, any portion of the
Common Areas to such extent, and for such period of time, as may in the
opinion of Landlord's counsel be necessary to prevent a dedication thereof
or the accrual of any rights to any person or the public therein;
(v) to temporarily suspend the use of all, or any portion of, the
Common Areas if required to comply with laws or the requirements of
Landlord's insurers or to make any repairs or alterations thereto or if
necessary in connection with the maintenance thereof; and
(vi) to take any other action with respect to the Common Areas, as
Landlord, in its sole discretion, shall determine to be advisable.
Notwithstanding the foregoing, Landlord agrees that the Common Areas
will be maintained in a manner consistent with first class office buildings in
Westchester County.
41.2 Tenant's right to use the Common Areas shall be deemed to be an
irrevocable license (except as provided in Section 41.1 hereof) coterminous with
the term of this Lease, and Landlord shall not be subject to any liability nor
shall Tenant be entitled to any compensation or diminution or abatement of rent
by reason of Landlord's exercise of any right or rights respecting Common Areas
reserved pursuant to Section 41.1 hereof, nor shall the exercise of any such
right be deemed a constructive or actual eviction, except for Tenant's
reasonable access to the demised premises and parking pursuant to this Lease.
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41.3 Tenant shall be entitled to free use of at least twenty-four
(24) parking spaces in common with others. Tenant agrees that if Landlord shall
designate specific parking spaces, it or its employees and invitees shall only
use such designated parking spaces. Landlord agrees that it will not designate
any such parking spaces in a discriminatory manner with respect to Tenant.
41.4 With respect to the parking of vehicles at the Building
Project:
(a) If Landlord elects to designate a specific parking area for
Tenant's use, Tenant shall require its personnel and visitors to park their
vehicles only in parking spaces designated by Landlord for Tenant's use for its
personnel and visitors on a "first come, first served" basis. Landlord reserves
the right at all times to redesignate such parking spaces. Tenant, its personnel
and visitors shall not at any time park any trucks or delivery vehicles in any
of the parking areas;
(b) all parking spaces and any other parking areas used by Tenant,
its personnel and visitors will be at their own risk, and Landlord shall not be
liable for any injury to person or property, or for loss or damage to any
automobile or its contents, resulting from theft, collision, vandalism or any
other cause whatsoever;
(c) there shall be no overnight parking and Tenant shall, and shall
cause its personnel and visitors to, remove their automobiles from the parking
area at the end of their working day. If any automobile owned by Tenant or by
its personnel or visitors remains in the parking area overnight and the same
interferes with the cleaning or maintenance of said area (snow or otherwise),
any costs or liabilities incurred by Landlord in removing said automobile to
effectuate cleaning or maintenance, or any damages resulting to said automobile
or to Landlord's equipment or equipment owned by others by reason of the
presence of or removal of said automobile during such cleaning or maintenance
shall be paid by Tenant to Landlord, as additional rent on the rent payment date
next following the submission of a bill therefor; and
(d) Tenant agrees not to use, or permit its employees or invitees to
use, any portion of the parking areas which have
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been designated for the exclusive use of another tenant in the Building Project.
ARTICLE 42
EXTENSION OF TERM
42.1 (a) Tenant shall have the right to extend the term of this
Lease for one (1) additional term of five (5) years. Such additional term
(hereinafter called the "Extension Term") shall commence upon the day following
the expiration of the initial term of this Lease and shall end on the last day
of the calendar month in which occurs the day preceding the fifth (5th)
anniversary of the commencement of said Extension Term. The option contained in
this Article 42 shall be subject to the following terms and conditions:
(i) Tenant shall give Landlord notice (hereinafter called the
"Extension Notice") of its election to extend the term of this Lease at
least six (6) months, but not more than twenty-four (24) months, prior to
the commencement of the Extension Term for which such Extension Notice is
given;
(ii) Tenant is not in default under the Lease (beyond any applicable
grace period) as of the time of the giving of the Extension Notice and the
commencement of the Extension Term for which such Extension Notice is
given; and
(iii) The Tenant named herein is an actual occupant, as of the
commencement of the Extension Term for which the Extension Notice is
given, of not less than fifty percent (50%) of the usable area of the
demised premises as of the time of the giving of the Extension Notice and
the commencement of the Extension Term.
(b) The fixed annual rent payable by Tenant to Landlord during such
Extension Term shall be the higher of (a) Two Hundred Three Thousand Five
Hundred and Fifty and 00/100 Dollars ($203,550) per year, or (b) Ninety-Five
Percent (95%) of the then fair market rent for the demised premises (as
determined in accordance with Section 42.2 herein) for such Extension Term. In
determining the aggregate amount of rent to be paid under this subsection
42.1(b) the provisions of Articles 3 and 4 of this Lease shall remain in effect
during the Extension Term.
42.2 (a) After Landlord receives the notice from Tenant specified in
Section 42.1(i), but no earlier than one (1) year prior to the end of the
original term of the Lease, it shall make the initial determination of the fixed
annual rent for the Extension Term ("Landlord's Submitted Rent"), which
determination
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will be Landlord's statement of the then fair market rent (as defined in Section
42.2(b) hereof) of the demised premises. Landlord shall give notice to Tenant of
Landlord's Submitted Rent within thirty (30) days after receipt of such notice
from Tenant. If Landlord and Tenant shall fail to agree upon the fixed annual
rent for the Extension Term, within thirty (30) days after delivery of such
notice by Landlord, then Landlord and Tenant each shall give notice to the other
setting forth the name and address of an arbitrator designated by the party
giving such notice. If either party shall fail to give notice of such
designation within ten (10) Business Days, then the arbitrator chosen shall make
the determination alone. If two arbitrators shall have been designated, within
thirty (30) days thereafter such two arbitrators shall make their determinations
of fixed annual fair market rent, as defined in Section 42.2(b), for the
Extension Term, in writing and give notice thereof to each other and to Landlord
and Tenant. Such two arbitrators shall have thirty (30) days after the receipt
of notice of each other's determinations to confer with each other and to
attempt to reach agreement as to the determination of fixed annual rent for the
Extension Term. If such two arbitrators shall concur as to the determination of
such fixed annual rent, such concurrence shall be final and binding upon
Landlord and Tenant. If such two arbitrators shall fail to concur, then such two
arbitrators shall immediately designate a third arbitrator. If the two
arbitrators shall fail to agree upon the designation of such third arbitrator
within five (5) days, then either party may apply to the American Arbitration
Association or any successor thereto having jurisdiction for the designation of
such arbitrator. All arbitrators shall be real estate appraisers or consultants
who shall have had at least ten (10) years continuous experience in the business
of appraising or managing real estate or acting as real estate agents or brokers
in the County of Westchester. The third arbitrator shall conduct such hearings
and investigations as he may deem appropriate and shall, within thirty (30) days
after his designation, choose one of the determinations of the two arbitrators
originally selected by the parties, and that choice by the third arbitrator
shall be binding upon Landlord and Tenant. Each party shall pay its own counsel
fees and expenses, if any, in connection with any arbitration under this
Section, including the expenses and fees of any arbitrator selected by it in
accordance with the provisions of this Section, and the parties shall share
equally all other expenses and fees of any such arbitration. The determination
rendered in accordance with the provisions of this Section shall be final and
binding in fixing the fixed annual rent for the Extension Term. The arbitrators
shall not have the power to add to, modify or change any of the provisions of
this Lease.
(b) "Fair market rent" for purposes of this Article 42 shall mean
the rental rate that would be paid in an arms-length transaction between a
landlord who is under no compulsion to
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lease and a tenant who is under no compulsion to rent the premises in question,
based upon the rental market for comparable buildings in Westchester County
under terms similar to those in this Lease.
(c) Prior to the determination of the arbitrators, Tenant shall pay
$203,550 as the fixed annual rent for the Extension Term, and in the event the
arbitrators determine that the fixed annual rent payable pursuant to this
Section 42.2 is more than that being paid by Tenant, then Tenant shall pay the
amount of such underpayment, with interest thereon at the Interest Rate, within
thirty-five (35) days after the arbitrators' determination.
(d) For the purposes of facilitating the computations of sums due
for fair market rent pursuant to Section 42.1(b): the sums payable pursuant to
Articles 3 and 4, as calculated on a per square foot basis, for the Lease Year
immediately preceding the commencement of the Extension Term shall be subtracted
from the fixed annual rent for the Extension Term determined pursuant to this
Section 42.2, as calculated on a per square foot basis; and in computing
escalations with respect to such space under Articles 3 and 4 hereof the Land
Tax Base Factor, the Building Tax Base Factor, the Building Expense Base Factor
and the Non-Building Expense Base Factor shall remain unchanged.
42.3 Except as provided in Section 42.1 hereof, Tenant's occupancy
of the demised premises during the Extension Term shall be on the same terms and
conditions as are in effect immediately prior to the commencement of such
Extension Term, provided, however, that upon the expiration of the Extension
Term Tenant shall have no further right to extend the term of this Lease.
42.4 If Tenant does not send an Extension Notice pursuant to
provisions of Section 42.1 hereof, this Article 42 hereof shall have no force or
effect and the term of this Lease shall expire on the last day of the initial
term hereof.
42.5 At such time as Tenant exercises its option pursuant to this
Article 42, Landlord or Tenant can request the other party hereto to execute an
instrument in form for recording setting forth the exercise of Tenant's right to
extend the term of this Lease and the last day of the subject Extension Term.
42.6 At such time as Tenant exercises its right to extend the term
of this Lease as herein provided, the phrases "the term of this Lease" or "the
term hereof" as used in this Lease, shall be construed to include, when
practicable, the Extension Term.
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IN WITNESS WHEREOF, Landlord and Tenant have respectively executed
this Lease as of the day and year first above written.
PURCHASE CORPORATE PARK
ASSOCIATES, Landlord
By: /s/ [ILLEGIBLE]
---------------------------
COURTAULDS UNITED STATES INC.,
Tenant
By: /s/ Howard A. Goldstein
---------------------------
Name: HOWARD A. GOLDSTEIN
Title: Vice President
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EXHIBIT A
SITE PLAN
<PAGE> 73
EXHIBIT A
Site Plan
[GRAPHIC OMITTED]
<PAGE> 74
EXHIBIT B
All that certain plot, piece or parcel of land, situate, lying and
being in the Town/Village of Harrison, County of Westchester and State of New
York being a 42.642 Acre Parcel of land shown and delineated on Map Number 20975
filed in the Office of the Clerk of Westchester County (Division of Land
Records) on July 26th, 1982; said parcel also being a portion of Parcels "C" and
"D" as shown on Map Number 19488 filed in the Office of the Clerk of Westchester
County (Division of Land Records) on May 22nd, 1978, being more particularly
bounded and described as follows:
BEGINNING at a point on the northeasterly side of Route I-684 where
the same is intersected by the southerly line of land now or formerly of
Whitelaw Reid, said point being the northwesterly corner of Parcel "C" as shown
on Filed Map No. 19488;
running thence along said land of Whitelaw Reid, the following
courses and distances:
North 72(degrees) 13' 05" East 321.205 feet,
North 84(degrees) 509' 40" East 333.53 feet,
North 44(degrees) 11' 00" East 453.19 feet,
North 48(degrees) 58' 00" East 29.71 feet,
North 65(degrees) 11' 30" East 200.54 feet and
North 65(degrees) 51' 30" East 56.95 feet to the
division line between Parcel "C" and Parcel "F" and the southwesterly corner of
said Parcel "F" as shown on Filed Map No. 19488;
thence easterly along said division line along a curve to the right
having a radius of 600.00 feet, the radial of which at its westerly end bears
North 14(degrees) 00' 31" West, said curve having a central angle 22(degrees)
38' 22" a distance of 237.079 feet to the division line between Parcel "B" and
Parcel "C" as shown on Filed Map No. 19488;
thence along said division line, South 2(degrees) 52' 00" West
720.135 feet to the division line between Parcel "C" and Parcel "B";
thence along said division line, commencing in a northerly direction
along a curve to the left having a radius of 70.00 feet, a central angle of
271(degrees) 27' 23", a distance of 331.65 feet to a point of reverse curve;
B-1
<PAGE> 75
thence along a curve to the right having a radius of 50.00 feet, a
central angle of 48(degrees) 11' 23" a distance of 42.05 feet to a point of
tangency;
thence continuing along the division line between Parcel "C" and
Parcel "B", South 40(degrees) 24' 00" East 693.099 feet to a point of curve;
thence along a curve to the right having a radius of 50.00 feet, a
central angle of 64(degrees) 21' 26" a distance of 56.162 feet to a point, said
point being a non-tangent intersection on Parcel 228 as shown on Filed Map No.
20781;
thence along the highway right-of-way, as established per said filed
Map No. 20781 as follows: In a southwesterly direction along a curve to the left
having a radius of 751.20 feet a central angle of 9(degrees) 29' 38" a distance
of 124.473 feet to a point of tangency;
South 33(degrees) 30' 33" West 447.23 feet,
South 57(degrees) 19' 19" West 23.62 feet,
South 72(degrees) 58' 51" West 78.52 feet, and
South 67(degrees) 39' 54" West 138.766 feet to a
non-tangent intersection with the division line between Parcel "C" and Parcel
"D" as shown on Filed Map No. 19488;
thence along said division line in a northwesterly direction along a
curve to the right having a radius of 400.00 feet, a central angle of
19(degrees) 46' 54" a distance of 138.101 feet to a point of tangency and
northeasterly side of Route I-684;
thence along the northeasterly side of Route I-684, the following
courses and distances:
North 63(degrees) 19' 08" West 462.679 feet,
South 45(degrees) 59' 00" West 593.505 feet,
South 45(degrees) 30' 27" West 138.225 feet, and
South 23(degrees) 35' 05" West 535.16 feet, to the
point and place of Beginning.
B-2
<PAGE> 76
EXHIBIT C
FIRST FLOOR PLAN
C-1
<PAGE> 77
EXHIBIT C
FIRST FLOOR PLAN
[GRAPHIC OMITTED]
FOR LEASING INFORMATION CONTACT:
RELATED
[LOGO] PROPERTIES
CORPORATION
626 Madison Avenue New York, NY 10022
212-421-5333
All measurements are approximate and made without representation
<PAGE> 78
EXHIBIT D
WORK LETTER TO LEASE
Between
PURCHASE CORPORATE PARK ASSOCIATES
and
COURTAULDS UNITED STATES INC.
Section 1.1 Exhibit D. The provisions of this Exhibit D shall have
the same force and effect as if this Exhibit were a numbered Article in the
Lease and all defined terms herein shall have the same meaning as given them in
the Lease.
Section 2.1 Landlord Work. Prior to the Commencement Date, Landlord
hereby agrees to perform work at the demised premises as set forth in the plans
and specifications prepared by Design Collaborative, Inc. dated August 13, 1991
(the "Plans and Specifications") annexed hereto at Exhibit D-1 and initialled by
the Tenant, except that Landlord shall not be responsible for the construction
of the reception desk as shown on the Plans and Specifications and Landlord
agrees to construct an electric closet on the demised premises to house the
panels, transformer and the submeter servicing the demised premises ("Landlord
Work"). Landlord Work shall be performed at Landlord's cost and expense, in a
good and workmanlike manner; provided, however, that if Landlord Work is delayed
due to Tenant Delays (as hereinafter defined) or the causes set forth in Article
34 of the Lease ("Force Majeure"), such date shall be extended one day for each
day of Tenant Delay or Force Majeure (however, see Section 2.2(B) below). In
addition, any changes in Landlord Work requested by Tenant shall be performed at
Tenant's sole cost and expense.
Section 2.2 Tenant Delay. If (A) a delay shall occur in the
completion of the Landlord Work as the result of (i) Tenant failing to send
notice to Landlord approving the Final Plans (as defined in Section 2.4 below)
on or prior to January 31, 1992, which approval shall not be unreasonably
withheld provided that the Final Plans substantially conform to the Plans and
Specifications, and provided further that if Landlord does not deliver the Final
Plans to Tenant for its approval on or prior to January 15, 1992, then the
January 31, 1992 deadline shall be extended by the number of days equal to the
number of days elapsed between January 15, 1992 and the date Landlord delivers
the Final Plans to Tenant for its review and approval, (ii) any direction by
Tenant that Landlord hold up proceeding with a segment of Landlord Work
preliminary to a possible change therein by Tenant or for any other reason,
(iii) a failure by Tenant to execute this Lease on or before August 20, 1991,
(iv) a failure by Tenant to approve the plans and specifications for the
Landlord Work annexed hereto on or before August 20, 1991, (iv) any change by
Tenant in any plan; specification or finish
D-1
<PAGE> 79
information to be furnished by Tenant, if any, (v) any delay caused solely by
any other act or omission of Tenant, its agents, employees or contractors, (vi)
the fact that a change requested by Tenant to Landlord Work requires lead time
to obtain or construction time to perform, in excess of that required for
Landlord's standard work with reasonable diligence in obtaining and performing
the same on the part of Landlord ("Long Lead Items"), or (vii) if work is to be
done by Tenant, its employees or contractors, which under good construction
scheduling practice should be completed before some portion of Landlord Work is
done, and Tenant's work is not completed on schedule, then (B) the Commencement
Date (as same may be extended pursuant to Section 2.1 above) shall (even though
no Certificate of Occupancy has been issued or Landlord Work has not been
completed) be deemed, but only for the purpose of determining the commencement
of fixed annual rent, to be one day earlier than provided for in Article 2 of
the Lease for each day of such delay, provided, however, that Tenant shall have
five (5) Business Days after written notice from Landlord to cure any act or
omission referred to in clause (iii) above before the provisions of subdivision
(B) shall become effective.
The extent of any delay referred to in Clause (A) of the first
paragraph of this Section shall be determined in the following manner: Landlord
shall give written notice to Tenant of the estimated length of the delay
involved within a reasonable time after the information necessary to estimate
such delay is available (which written notice shall include the reasons for
Landlord's estimate) and the extent of such delay shall be deemed to be as so
estimated unless, within five (5) Business Days after the giving of such written
notice, Tenant shall notify the party from which the written notice originates
of any disagreement therewith (including Tenant's reasons therefor).
Notwithstanding anything to the contrary contained in this Section
2.2, if Landlord submits the Final Plans earlier than January 15, 1992, then
Tenant shall have two (2) weeks to send notice to Landlord approving said Final
Plans, which approval shall not be unreasonably withheld.
Section 2.3 Tenant's Contractors. Tenant and Tenant's Contractors,
if any, may have access to the demised premises during the period prior to the
Commencement Date for the purposes of installing a telephone system and
delivering furniture and other minor fixturing.
In connection with such access, Tenant shall (a) cease promptly upon
request by Landlord any activity or work during any period which shall interfere
with or delay Landlord's prosecution or completion of Landlord Work, including
without limitation the use of any labor or materials that may cause, in
Landlord's sole
D-2
<PAGE> 80
discretion, any labor disharmony at the A/B Building, (b) comply promptly with
all procedures and regulations prescribed by Landlord from time to time for
coordinating such work and activities with any other activity or work in the
demised premises or the A/B Building, and (c) pay any loss or additional expense
incurred by Landlord by any delay in the completion of Landlord Work resulting
therefrom. Such access by Tenant shall be deemed to be pursuant to all the
provisions of this Lease except that there shall be no obligation on the part of
Tenant solely because of such access to pay any fixed annual or additional rent
for any period prior to the Commencement Date. Additionally, Tenant shall comply
with the provisions of Article 6 of the Lease. If Tenant fails to comply with
any of the foregoing obligations, in addition to all other rights and remedies
hereunder, Landlord may by Notice require Tenant to cease the performance of
such activity and work until the Finish Work has been completed.
Tenant may select and employ its own contractors for the work
referred to in the first paragraph of this Section. If Tenant or its contractors
interfere with or delay Landlord's prosecution or completion of Landlord Work,
any repairs or changes to such Landlord Work required as a result of any work by
Tenant or its contractors shall be done at Tenant's sole cost and expense, and
Tenant shall immediately reimburse Landlord for any expense incurred by Landlord
in connection with such repairs or changes. Landlord shall afford Tenant and its
contractors reasonable opportunity to use the A/B Building's facilities in order
to enable Tenant and its contractors to perform such work economically and
expeditiously, but Tenant and its contractors shall be responsible for
scheduling. Tenant shall be responsible for coordination of the work of Tenant's
contractors with Landlord's subcontractors. Water, electricity, heat or
ventilation which is available for Landlord's contractors in the area of the
demised premises shall be furnished, without charge, to Tenant and its
contractors, to the extent they may be reasonably required by Tenant's
contractors, during the normal working hours for Tenant's contractors, and if
feasible, in all other instances, shall be provided to Tenant's contractors, at
Tenant's cost, on a 24-hour basis.
Section 2.4 "Final Plans" shall mean the plans and specifications,
including the Finish Schedules (defined below), incorporating all information,
including that contained in the Engineering Plans (defined below), which may be
needed to perform or let contracts for the performance of Landlord Work
(including the details of all such work and the dimensioned locations and
elevations thereof with reference to architectural elements) in accordance with
the Plans and Specifications.
Section 2.5 "Engineering Plans" shall mean the electrical,
mechanical, plumbing and (if required) structural
D-3
<PAGE> 81
plans to describe the electrical, mechanical, plumbing, air-conditioning and
structural work to be included in Landlord Work to finish the demised premises
in accordance with the Final Plans.
Section 2.6 "Finish Schedules" shall mean the portion of the Final
Plans providing a complete listing of (i) the finishes to be applied to all
wall, ceiling and floor surfaces forming a part of Landlord Work and (ii) the
non-structural architectural detailing, including color samples, and
identification of materials by manufacturers' catalogue numbers, if applicable,
and any other similar information which Landlord will need to order such
material and perform that portion of Landlord Work.
Section 2.7 Tenant Contribution. Notwithstanding anything to the
contrary contained in this Exhibit D, should Tenant require work to be completed
by Landlord (i) in addition to Landlord Work as set forth in the Plans and
Specifications, (ii) as a change order to the Final Plans, and (iii) as
otherwise may be required to conform to any legal requirements arising from
Tenant's use and occupancy of the demised premises, Tenant shall pay to Landlord
an amount equal to the actual cost to Landlord ("Landlord's Costs") of
performing the aforesaid work plus ten (10%) percent for general conditions plus
ten (10%) percent for profit and overhead. In connection with this Section 2.7,
Landlord represents that the use of the demised premises by Tenant as specified
in Article V presently conforms to the requirements of the certificate of
occupancy for the Building.
D-4
<PAGE> 82
EXHIBIT B
GENTLEMEN:
WE HEREBY OPEN OUR IRREVOCABLE STANDBY LETTER OF CREDIT IN YOUR FAVOR FOR THE
ACCOUNT OF (INSERT NAME), LOCATED AT (INSERT ADDRESS) IN THE AGGREGATE AMOUNT OF
USD ____ (UNITED STATES DOLLARS {_______} THOUSAND 00/100) AVAILABLE BY PAYMENT
OF YOUR DRAFT(S) AT SIGHT DRAWN ON OURSELVES WHEN ACCOMPANIED BY THE FOLLOWING
DOCUMENT(S):
A STATEMENT PURPORTEDLY SIGNED BY AN AUTHORIZED REPRESENTATIVE OF AKZO NOBEL
INC. STATING THAT:
"I HEREBY CERTIFY THAT OUR DRAFT IN THE AMOUNT OF (INSERT AMOUNT) PRESENTED TO
(BANK NAME) UNDER LETTER OF CREDIT NO. (INSERT LETTER OF CREDIT NUMBER)
REPRESENTS FUNDS DUE US AS (INSERT NAME) IS IN DEFAULT OF IT'S OBLIGATIONS
PURSUANT TO A SUBLEASE DATED MAY ___, 1999 (THE "SUBLEASE") BETWEEN AKZO NOBEL
CUSI INC. ("SUBLANDLORD") AND INTERLIENT, INC. ("SUBTENANT").
THIS IRREVOCABLE LETTER OF CREDIT SETS FORTH IN FULL THE TERMS OF OUR
UNDERSTANDING. THIS UNDERTAKING SHALL NOT IN ANY WAY BE MODIFIED, AMENDED, OR
AMPLIFIED BY REFERENCE TO ANY DOCUMENT OR CONTRACT REFERRED TO HEREIN.
IT IS A CONDITION OF THIS LETTER OF CREDIT THAT IT SHALL TERMINATE ON JULY 30,
2002.
WE HEREBY AGREE WITH YOU THAT DRAFT(S) DRAWN UNDER AND IN COMPLIANCE WITH THE
TERMS AND CONDITIONS OF THIS CREDIT SHALL BE DULY HONORED IF PRESENTED TOGETHER
WITH DOCUMENT(S) AS SPECIFIED AND THE ORIGINAL OF THIS CREDIT, AT OUR OFFICE
LOCATED AT (BANK ADDRESS) ON OR BEFORE THE ABOVE STATED EXPIRY DATE. DRAFT(S)
DRAWN UNDER THIS CREDIT MUST SPECIFICALLY REFERENCE OUR CREDIT NUMBER.
EXCEPT AS OTHERWISE EXPRESSLY STATED HEREIN, THIS LETTER OF CREDIT IS SUBJECT TO
THE UNIFORM CUSTOMS AND PRACTICE FOR DOCUMENTARY CREDITS, ESTABLISHED BY THE
INTERNATIONAL CHAMBER OF COMMERCE, AS IN EFFECT ON THE DATE OF ISSUANCE OF THIS
CREDIT.
SINCERELY,
- ------------------------------------
AUTHORIZED SIGNATURE OF BANK OFFICER
<PAGE> 83
Exhibit C
Inventory of Furniture
"Window" Offices
# 1 office:
(1) Desk unit with closet
(1) Desk chair
(1) Guest chair
(1) Couch
(1) File Cabinet
(2) Round side tables
# 2 office:
(1) Desk unit
(1) Desk chair
(1) Guest chair
(2) File cabinets
# 3 office:
(1) Desk unit
(1) Desk chair
(1) Guest chair
# 4 office:
(1) Desk unit with closet
(1) Desk chair
(1) Guest chair
(2) Round side tables
(1) Couch
# 5 office:
(1) Desk unit
(1) Desk chair
(1) Guest chair
<PAGE> 84
# 6 office:
(1) Desk unit with closet
(1) Guest chair
(2) Round side tables
(1) Couch
# 7 office:
(1) Desk unit
(1) Desk chair
(1) Guest chair
(1) Round side table
# 8 office:
(1) Desk unit
(1) Desk chair
(1) Guest chair
(1) Round side table
(1) Couch
"Inside" Offices (No Windows)
# 1 office:
(1) Desk unit
(1) Desk chair
(1) Guest chair
# 2 office:
(1) Desk unit
(1) Desk chair
(1) Guest chair
"Audit" Room
(4) Desks
(4) Desk chairs
(2) Club chairs
(4) File cabinets
<PAGE> 85
Kitchen
(1) Kitchen table
(4) Kitchen chairs
(1) GE Refrigerator
(1) GE Dishwasher
File Cabinets in Hallway
(14) Maroon cabinets
File Room
(1) Small table/cabinet
(11) File cabinets ?
Work Stations
(4) Desk units
(4) Desk chairs
Small Conference Room/Library
(1) Conference table
(1) Conference table base
(8) Low back chairs
(8) Bookshelves
(2) Built-in file cabinets
Main Conference Room
(1) Conference table 5' x 15'
(2) Low back chairs
(12) High back chairs
(2) Side tables - 1 round and 1 triangular
(2) Dome light fixtures
Reception Area
(1) Seating module
(1) 42" round coffee table
(1) Glass table
(2) Lamps
<PAGE> 86
EXHIBIT D
BILL OF SALE
KNOW ALL MEN BY THESE PRESENTS, that Akzo Nobel CUSI, Inc. a Delaware
corporation, (hereinafter "Seller"), for value received, hereby sells,
transfers, assigns, conveys, delivers, alienates, releases, and sets over to
Interliant, Inc. a Delaware corporation (hereinafter "Purchaser"), and its
successors and assigns forever, pursuant to a Sublease dated May ___, 1999
(hereinafter the "Sublease"), by and between Seller and Purchaser, all of its
legal, beneficial and other rights, title and interest in and to certain
furniture which is set forth on Exhibit C to the Sublease, to have and to hold
the same unto Purchaser, its successors and assigns, to or for its or their use
forever. Seller hereby represents and warrants to Purchaser that Seller has
good, valid, and marketable title to said purchased assets, that said property
is free and clear of all liens, encumbrances, and other restrictions and that
Seller has full right, power and authority to sell said property and to make
this Bill of Sale.
June 30, 2002 AKZO NOBEL CUSI, INC.
By: ___________________________
Title:
(Corporate Seal)
<PAGE> 1
Exhibit 10.27
SUBLEASE
This Sublease is made as of the 11th day of May, 1999, by and between Akzo
Nobel CUSI, Inc. a Delaware corporation (hereinafter referred to as
"Sublandlord") and Interliant, Inc., a Delaware corporation (hereinafter
referred to as "Subtenant") with regard to the following facts.
RECITALS
A. Sublandlord is the Tenant under that certain Agreement of Lease dated August
23, 1991 (the "Master Lease"), with Purchase Corporate Park Associates, a New
York partnership (the "Landlord"), (a copy of the Master Lease is attached
hereto as Exhibit A and by this reference made a part hereof) concerning
approximately 6,105 rentable square feet of office space (the "Premises")
located on the first floor of the building, designated Building B in the Master
Lease (the "Building") located at Two Manhattanville Road, Purchase, New York.
B. Subtenant desired to sublease from Sublandlord the Premises (which shall be
hereafter referred to as the "Subleased Premises") more particularly set forth
in the Master Lease, and Sublandlord has agreed to sublease the Subleased
Premises to Subtenant upon the terms, covenants and conditions herein set forth.
AGREEMENT
In consideration of the mutual covenants contained herein, the sufficiency
of which is hereby acknowledged, the parties hereto agree as follows:
1. Sublease - Sublandlord hereby subleases and demises to Subtenant and
Subtenant hereby hires and takes from Sublandlord the Subleased Premises.
2. Term - The term of this Sublease (the "Term") shall commence as of June 1,
1999, and shall end, unless sooner terminated as provided in the Master Lease or
hereunder on June 30, 2002 ("Expiration Date").
3. Rent - The fixed annual rent during the term of this Sublease is $156,900
payable monthly in advance on the first day of a month in the amount of $13,075.
Subtenant shall also be responsible to reimburse Sublandlord for all (i)
electricity charges incurred by Subtenant at the Premises pursuant to Article 12
of the Master Lease which is presently submetered (ii) tax escalation charges
billed by the Landlord pursuant to Article 3 of the Master Lease (the tax
escalation charges for the first Tax Year of the Sublease shall be prorated)
(iii) expense escalation charges billed for the period commencing June 1, 1999
by the Landlord pursuant to Article 4 of the Master Lease and (iv) any other
charges billed by the Landlord pursuant to the Master Lease.
<PAGE> 2
4. Security Deposit -
4.1 On the signing of this Sublease, Subtenant shall deposit with
Sublandlord as security for the Subtenant's faithful performance of all the
terms and conditions of this Sublease and of the Master Lease, including the
obligation to pay rent, cash in the amount of $ 78,450.00 ("Security Deposit").
During the term of this Sublease and provided Subtenant is not then in default
of any of the terms hereof, Subtenant may replace all or a portion of the
Security Deposit with a letter of credit, provided the terms of such letter of
credit comply with the provisions of Section 4.3 below. Sublandlord will pay
Subtenant interest at the rate of 6% per year on the Security Deposit which is
being held in cash. Sublandlord shall make this interest payment annually. If on
April 30, 2002, Sublandlord is holding three (3) or more months base rent in
cash as Security Deposit, Sublandlord will withdraw from the Security Deposit
sufficient funds to apply to the last two (2) month's base rent provided (i)
Subtenant is not then in default of this Sublease and (ii) Sublandlord has no
reasonable concern that the remaining Security Deposit would be insufficient to
pay any and all amounts due by Subtenant pursuant to this Sublease.
4.2 On or about May 1, 2000 and/or May 1, 2001, Subtenant may request
permission of Sublandlord to reduce the Security Deposit to 3 month's base rent
(i.e. $39,225) effective June of 2000 or June of 2001 respectively. In making
its request to reduce the Security Deposit, Subtenant shall provide to
Sublandlord current financial statements of Subtenant and other information as
reasonably requested by Sublandlord. If Sublandlord in its discretion,
determines that Subtenant's then current financial condition and performance
under the Sublease is such that a Security Deposit of 6 month's rent is no
longer necessary to protect Sublandlord, Sublandlord may reduce the Security
Deposit to an amount equivalent to 3 month's base rent. If reduced by
Sublandlord, Subtenant may elect to have the reduced Security Deposit be in the
form of cash or a letter of credit, for all or part of the Security Deposit.
4.3 Any letter of credit provided by Subtenant hereunder shall, (i) expire
no earlier than July 31, 2002, (ii) be drawn on Chase Manhattan Bank, N.A. or
such other financial institution reasonably satisfactory to Sublandlord, (iii)
require such financial institution to notify Sublandlord not less than sixty
(60) days before termination, for any reason, of the letter of credit, (iv)
provide for the Sublandlord to draw on the letter of credit in any amount up to
and including the full amount of the letter of credit on notice to the financial
institution as provided in the form of letter of credit annexed hereto as
Exhibit B, (v) and contain such other terms as mutually agreed upon
substantially in the form attached hereto as Exhibit B. If Subtenant shall
default beyond any applicable notice and cure periods as defined herein with
respect to any term and condition hereunder then the Security Deposit or any
part thereof may be applied by Sublandlord (but Sublandlord shall not be
obligated to do so) to the actual damages sustained by Sublandlord by reason
thereof. No such application shall be construed as an agreement to limit the
amount of Sublandlord's claim or, as a waiver of any damage or release of any
indebtedness of Sublandlord's claim not recovered in full from the Security
Deposit. If Sublandlord has so applied all or any part of the Security Deposit,
Sublandlord shall have the right (but not the obligation) at any time thereafter
to demand that Subtenant pay to Sublandlord a sum equal to the amounts so
applied so that Sublandlord will always be in possession of a sum equal to the
amount of the Security Deposit. Subtenant shall make each such remittance within
thirty (30) days following such demand by Sublandlord. Said remittance shall
thereupon constitute a part of
2
<PAGE> 3
the Security Deposit subject to the terms and provisions hereof. The failure of
Subtenant to make any such requested remittance within such thirty (30) day
period, and after any applicable notice and cure period, may be treated by
Sublandlord as a failure by Subtenant to make timely payments of rent and as an
event of default.
5. Furniture Lease - Sublandlord hereby leases to Subtenant and Subtenant hereby
hires and takes from Sublandlord the furniture ("Furniture") currently located
in the Premises ("Furniture Lease") set forth on the form entitled "Inventory of
Furniture" attached hereto as Exhibit C. The terms of the Furniture Lease are as
follows:
5.1 The Furniture is being leased "AS IS WHERE IS" with no warranties
being made by Sublandlord other than that the Furniture is owned by Sublandlord
and is fully paid for, and that the Furniture is not encumbered by any liens,
security interests or other encumbrances.
5.2 The one-time lease payment for the Furniture will total $75,000
payable upon execution of this Sublease. Subtenant will also pay to Sublandlord
the sales tax due upon this Furniture Sublease in the amount of 6.75% (i.e.
$5,062.50) upon execution of this Sublease. Sublandlord will properly remit the
sales tax to the proper New York State taxing authorities.
5.3 The term of the Furniture Lease will be coterminous with the term of
this Sublease. Should Sublandlord terminate the Sublease pursuant to Section 9.7
hereof because of a default by Subtenant after all applicable notice and grace
periods in the Sublease, Subtenant will consequently be in default of the
Furniture Lease and the Furniture Lease will terminate.
5.4 During the term of the Furniture Lease Subtenant agrees to take good
care of and properly maintain the Furniture. At the termination of the Furniture
Lease, the Furniture must be in the same condition as of the commencement of the
Furniture Lease, normal wear and tear excepted.
5.5 Subtenant shall execute any documents and forms reasonably required by
Sublandlord to file a security interest in the Furniture.
5.6 Provided Subtenant is not then in default, after all applicable notice
and grace periods of any of its obligations set forth in the Sublease, on June
30, 2002 Subtenant may purchase the Furniture for the sum of $1.00. Upon payment
of said $1.00, title to the Furniture will automatically be transferred and
assigned to Subtenant without any further action on the part of either party.
Notwithstanding the foregoing, a bill of sale in the form attached hereto as
Exhibit D will be executed by Sublandlord and delivered to Subtenant upon said
payment. Sublandlord's failure to deliver the bill of sale shall not adversely
affect good title to the Furniture being conveyed to Subtenant.
6. Use - Subtenant covenants and agrees to use the Subleased Premises in
accordance with Article 5 of the Master Lease and for no other purpose and
otherwise in accordance with the terms and conditions of the Master Lease and
this Sublease.
3
<PAGE> 4
7. Master Lease - As applied to this Sublease, the words "Landlord" and "Tenant"
as used in the Master Lease shall be deemed to refer to Sublandlord and
Subtenant hereunder, respectively. Subtenant and this Sublease shall be subject
in all respects to the terms of, and the rights of the Landlord under, the
Master Lease. Except as otherwise expressly provided in this Sublease, the
covenants, agreements, terms, provisions and conditions of the Master Lease
insofar as they relate to the Subleased Premises and insofar as they are not
inconsistent with the terms of this Sublease are made a part of and incorporated
into this Sublease as if recited herein in full, and the rights and obligations
of the Landlord and the Tenant under the Master Lease shall be deemed the rights
and obligations of Sublandlord and Subtenant respectively hereunder and shall be
binding upon and inure to the benefit of Sublandlord and Subtenant respectively.
As between the parties hereto only, in the event of a conflict between the terms
of the Master Lease and the terms of this Sublease, the terms of this Sublease
shall control. Notwithstanding anything to the contrary herein, (i) Subtenant is
not granted and shall not have any greater rights under this Sublease than
Sublandlord has under the Master Lease and (ii) Subtenant's rights and
obligations pursuant to the Master Lease shall commence upon the commencement
date of the term of this Sublease and terminate upon expiration of the Sublease
except as to acts, omissions or occurrences arising during the term of the
Sublease.
8. Landlord's Performance Under Master Lease
8.1 Subtenant recognizes that Sublandlord is not in a position to render
any of the services or to perform any of the obligations required of Sublandlord
by the terms of this Sublease. Therefore, notwithstanding anything to the
contrary contained in this Sublease, Subtenant agrees that performance by
Sublandlord of its obligations hereunder are conditional upon due performance by
the Landlord of its corresponding obligations under the Master Lease and
Sublandlord shall not be liable to Subtenant for any default of the Landlord
under the Master Lease. Subtenant shall not have any claim against Sublandlord
by reason of the Landlord's failure or refusal to comply with any of the
provisions of the Master Lease unless such failure or refusal is a result of
Sublandlord's act or failure to act. This Sublease shall remain in full force
and effect notwithstanding the Landlord's failure or refusal to comply with any
such provision of the Master Lease and Subtenant shall pay the base rent and
additional rent and all other charges provided for herein without any abatement,
deduction or setoff whatsoever. Notwithstanding the foregoing, if Landlord
defaults in any of its obligations under the Master Lease, Subtenant shall be
entitled to participate with Sublandlord in any action or proceeding undertaken
by Sublandlord in the enforcement of Sublandlord's rights against Landlord. If
Sublandlord elects not to take action or proceeding, whether legal action or
otherwise, for the enforcement of Sublandlord's rights against Landlord, it
shall notify Subtenant in writing and thereafter Subtenant shall have the right
to take such action or proceeding in its own name and for that purpose and only
to such extent, all the rights of Sublandlord under the Lease with respect to
the Subleased Premises shall be and are hereby conferred upon and assigned to
Subtenant, and Subtenant shall be subrogated to such rights to the extent they
apply to the Subleased Premises. Subtenant shall protect, defend, indemnify and
hold Sublandlord harmless from all claims, costs and liabilities, including
attorney' fees and costs, arising out of or in connection with any such action
or proceeding by Subtenant. Subtenant covenants and warrants that it fully
understands and agrees to be subject to and abide by all of the covenants,
agreements, terms, provisions and conditions of the Master Lease during the term
of this Sublease, except as modified herein.
4
<PAGE> 5
Furthermore, Subtenant and Sublandlord further covenant not to take any action
or do or perform any act to fail to perform any act which would result in the
failure or breach of any of the covenants, agreements, terms, provisions or
conditions of the Master Lease on the part of the Tenant thereunder.
8.2 Whenever the consent of Landlord shall be required by, or Landlord
shall fail to perform its obligations under, the Master Lease, Sublandlord
agrees to use its good faith efforts to obtain, at Subtenant's sole cost and
expense, such consent and/or performance on behalf of Subtenant.
8.3 Sublandlord represents and warrants to Subtenant that the Master Lease
is in full force and effect and that to its knowledge, neither the Landlord or
Sublandlord is now in breach of any provisions of said Master Lease and that the
rent and additional rent due thereunder has been paid through May 30, 1999.
8.4 Copies of any and all notices of default delivered to or from Landlord
and to or from Sublandlord concerning the Master Lease, shall be delivered to
Subtenant in accordance with Section 9.3 hereof within two (2) business days of
Sublandlord's delivery or receipt thereof, as the case may be.
9. Variations from Master Lease - The following covenants, agreements, terms,
provisions and conditions of the Master Lease are hereby modified or not
incorporated herein.
9.1 The parties hereto represent and warrant to each other that neither
party dealt with any broker or finder in connection with the consummation of
this Sublease other than Benson Commercial Realty, Inc. ("Benson"), and each
party agrees to indemnify, hold and save the other party harmless from and
against any and all claims for brokerage commissions or finder's fees, other
than to Benson, arising out of either of their acts in connection with this
Sublease. The provisions of this Section 9.1 shall survive the expiration or
earlier termination of this Sublease. Commission due to Benson is the subject of
a separate agreement and the responsibility of Sublandlord and Sublandlord shall
indemnify and hold Subtenant harmless from and against any claims, costs
(including reasonable attorneys' fees) or causes of actions arising from that
agreement.
9.2 Notwithstanding anything contained in the Master Lease to the
contrary, as between Sublandlord and Subtenant only, all insurance proceeds or
condemnation awards received by Sublandlord under the Master Lease shall be
deemed to be the property of Sublandlord.
9.3 Any notice which may or shall be given by either party hereunder shall
be either delivered personally, sent by certified mail, return receipt
requested, or by overnight express delivery, addressed to the party for whom it
is intended, (i) at the Subleased Premises to the attention of General Counsel
(if to the Subtenant), and (ii) if to Sublandlord to General Counsel, Akzo Nobel
Inc., 7 Livingstone Avenue, Dobbs Ferry, NY 10522-3408, or to such other address
as may have been designated in a notice given in accordance with the provisions
of this Section 9.3.
5
<PAGE> 6
9.4 All amounts payable hereunder by Subtenant to Sublandlord shall be
payable directly to Sublandlord, as follows:
Checks payable to: Akzo Nobel Inc.
Checks mailed to: Akzo Nobel Inc.
AP/AR Department
300 South Riverside Plaza
Chicago, IL 60606
9.5 The provisions of Section 2.1, Article 24, Article 39 and Article 42
of the Master Lease shall not apply to this Sublease.
9.6 Sublandlord shall deliver and Subtenant shall accept the Subleased
Premises in their existing "as is" condition, as of the commencement date of
this Sublease.
9.7 Notwithstanding anything in Section 16.2 of the Master Lease to the
contrary, Subtenant shall be in default of the Sublease and Sublandlord may
thereupon immediately terminate the Sublease; (a) if Subtenant permits anything
to be done whether by action or inaction, contrary to any of Subtenants
obligations hereunder, including Subtenant's obligations to pay fixed annual
rent or additional rent or other charges under this Sublease, and if such
situation shall continue and shall not be remedied by Subtenant within fifteen
(15) days after Sublandlord shall have given to Subtenant a notice specifying
the same, or, in the case of a happening or default which cannot with due
diligence be cured within a period of fifteen (15) days and the continuation of
which for the period required for cure will not subject Sublandlord to the risk
of criminal liability (as more particularly described in Article 8 of the Master
Lease) or termination of the Master Lease, if Subtenant shall not, (i) within
said fifteen (15) day period advise Sublandlord of Subtenant's intention to duly
institute all steps necessary to remedy such situation, (ii) duly institute
within said fifteen (15) day period, and thereafter diligently and continuously
prosecute to completion all steps necessary to remedy the same and (iii)
complete such remedy within such time after the date of the giving of said
notice of Sublandlord as shall be necessary; or (b) whenever Subtenant shall
abandon the demised premises (unless as a result of a casualty) and such
abandonment shall continue for fifteen (15) days; or (c) whenever Subtenant
shall default in the due keeping, observing or performance of any covenant,
agreement, provision or condition of Article 5 of the Master Lease on the part
of Subtenant to be kept, observed or performed and if such default shall
continue and shall not be remedied by Subtenant within three (3) Business Days
after Subtenant receives a notice specifying the same.
9.8 In addition to any rights Sublandlord may have under the terms of the
Master Lease in the event of a default of this Sublease by Subtenant as provided
in Section 9.7 hereof, Sublandlord may enter upon and take possession of the
Premises by force if necessary and expel or remove Subtenant and any other
person who may be occupying said Premises or any part thereof, if necessary,
without being liable for prosecution or any claim of damages therefore and, if
Sublandlord so elects, relet the Premises on such terms as Sublandlord may deem
advisable.
6
<PAGE> 7
9.9 Sublandlord agrees that Subtenant shall have the right to use the
Building parking facilities pursuant to the terms of the Master Lease.
10. Signage - Subtenant shall coordinate directly with the Landlord for
directory signage at Subtenant's sole cost.
11. Indemnity -
11.1 Subtenant hereby agrees to protect, to defend, to indemnify and to
hold harmless Sublandlord from and against any and all liabilities, claims,
expenses, losses and damages, including, without limitation, reasonable
attorney's fees and disbursements, based upon any act or omission, occurring
during the term of this Sublease and which may at any time be asserted against
Sublandlord by (a) the Landlord for failure of Subtenant to perform any of the
covenants, agreements, terms, provisions or conditions contained in the Master
Lease which by reason of the provisions of this Sublease Subtenant is obligated
to perform, or (b) any person by reason of Subtenant's use and/or occupancy of
the Subleased Premises or negligent or intentional acts in or about the
Building. The provisions of this Section 11.1 shall survive the expiration or
earlier termination of the Master Lease and/or this Sublease.
11.2 Sublandlord hereby agrees to protect, to defend, to indemnify and to
hold harmless Subtenant from and against any and all liabilities, claims,
expenses, losses and damages, including, without limitation, reasonable
attorney's fees and disbursements, based upon any act or omission occurring
either prior to or after the term of this Sublease and which may at any time be
asserted against Subtenant by (a) the Landlord for failure of Sublandlord to
perform any of the covenants, agreements, terms, provisions or conditions
contained in the Master Lease other than those which by reason of the provisions
of this Sublease, Subtenant is obligated to perform, or (b) any person by reason
of Sublandlord's use and/or occupancy of the Subleased Premises or negligent or
intentional acts in or about the Building. The provisions of this Section 11.2
shall survive the expiration or earlier termination of the Master Lease and/or
this Sublease.
11.3 Subtenant in complying with its obligations to provide insurance
pursuant to Article 9 of the Master Lease must provide to Sublandlord and
Landlord satisfactory proof of valid insurance coverage by way of Certificates
of Insurance showing Sublandlord as an additional insured to all policies,
except Worker's Compensation, and further providing that, (i) such policies
shall not be materially altered or cancelled except upon at least thirty (30)
days prior written notice to Sublandlord, and (ii) such insurance is primary to
any insurance Sublandlord may have under the Master Lease.
12. Certificates - Subtenant shall at any time and from time to time as
requested by Sublandlord upon not less than ten (10) days prior written notice,
execute, acknowledge and deliver to Sublandlord a statement in writing
certifying that this Sublease is unmodified and in full force and effect (or if
there have been modifications that the same is in full force and effect as
modified and stating the modifications, if any) certifying the dates to which
rent and any other charges have been paid and stating whether or not, to the
knowledge of the person signing the
7
<PAGE> 8
certificate, Sublandlord is not in default beyond any applicable grace period
provided herein in performance of any of its obligations under this Sublease,
and if so, specify each such default of which Subtenant may have knowledge, it
being intended that any such statement delivered pursuant hereto may be relied
upon by others with whom Sublandlord may be dealing.
13. Assignment or Subletting - Subject further to all of the rights of the
Landlord under the Master Lease and the restrictions contained in the Master
Lease, Subtenant shall not be entitled to assign this Sublease or to sublet all
or any portion of the Subleased Premises without the prior written consent of
(i) Landlord as provided in the Master Lease and (ii) the Sublandlord, which
consent of Sublandlord shall not be unreasonably withheld or delayed. However,
the foregoing consent of Sublandlord shall not be required in the event
Subtenant sells all or substantially all of its assets or capital stock to
another entity and that successor entity has a net worth after the closing of
such transaction, equal to or greater than the net worth of Subtenant prior to
the closing of such transaction.
14. Captions and Definitions - Captions to the Sections in this Sublease are
included for convenience only, and are not intended and shall not be deemed to
modify or explain any of the terms of this Sublease.
15. Further Assurances - The parties hereto agree that each of them, upon the
request of the other party, shall execute and deliver, in recordable form if
necessary, such further documents, instruments or agreements and shall take such
further action that may be necessary or appropriate to effectuate the purposes
of this Sublease.
16. Governing Law - This Sublease shall be governed by and in all respects
construed in accordance with the internal laws of the State of New York.
17. Consent of Landlord - The validity of this Sublease shall be subject to the
Landlord's consent hereto pursuant to the terms of the Master Lease.
18. Entire Agreement; Waiver - This Sublease contains the entire agreement
between the parties hereto and shall be binding upon and inure to the benefit of
Sublandlord's respective heirs, representatives, successors and permitted
assigns. Any agreement hereinafter made shall be ineffective to change, modify,
waive, release, discharge, terminate or effect an abandonment hereof, in whole
or in part, unless such agreement is in writing and signed by the parties
hereto.
8
<PAGE> 9
SIGNATURE PAGE TO SUBLEASE AGREEMENT DATED AS OF MAY 11, 1999
IN WITNESS WHEREOF, the parties hereto have caused this Sublease to be
executed as of the day and year first above written.
"Sublandlord":
Akzo Nobel CUSI, Inc.
By: /s/ Howard Goldstein
-----------------------------------
Howard Goldstein, Vice President
"Subtenant"
Interliant, Inc.
By: /s/ Leonard J. Fassler
------------------------------------
Leonard J. Fassler, Co-Chairman
CONSENT OF MASTER LESSOR
Purchase Corporate Park Associates
By: ______________________________
Title: ___________________________
9
<PAGE> 10
EXHIBIT B
GENTLEMEN:
WE HEREBY OPEN OUR IRREVOCABLE STANDBY LETTER OF CREDIT IN YOUR FAVOR FOR THE
ACCOUNT OF (INSERT NAME), LOCATED AT (INSERT ADDRESS) IN THE AGGREGATE AMOUNT OF
USD ______ (UNITED STATES DOLLARS {.............} THOUSAND 00/100) AVAILABLE BY
PAYMENT OF YOUR DRAFT(S) AT SIGHT DRAWN ON OURSELVES WHEN ACCOMPANIED BY THE
FOLLOWING DOCUMENT(S):
A STATEMENT PURPORTEDLY SIGNED BY AN AUTHORIZED REPRESENTATIVE OF AKZO NOBEL
INC. STATING THAT:
"I HEREBY CERTIFY THAT OUR DRAFT IN THE AMOUNT OF (INSERT AMOUNT) PRESENTED TO
(BANK NAME) UNDER LETTER OF CREDIT NO. (INSERT LETTER OF CREDIT NUMBER)
REPRESENTS FUNDS DUE US AS (INSERT NAME) IS IN DEFAULT OF IT'S OBLIGATIONS
PURSUANT TO A SUBLEASE DATED MAY ____, 1999 (THE "SUBLEASE") BETWEEN AKZO NOBEL
CUSI INC. ("SUBLANDLORD") AND INTERLIENT, INC. ("SUBTENANT").
THIS IRREVOCABLE LETTER OF CREDIT SETS FORTH IN FULL THE TERMS OF OUR
UNDERSTANDING. THIS UNDERTAKING SHALL NOT IN ANY WAY BE MODIFIED, AMENDED, OR
AMPLIFIED BY REFERENCE TO ANY DOCUMENT OR CONTRACT REFERRED TO HEREIN.
IT IS A CONDITION OF THIS LETTER OF CREDIT THAT IT SHALL TERMINATE ON JULY 30,
2002.
WE HEREBY AGREE WITH YOU THAT DRAFT(S) DRAWN UNDER AND IN COMPLIANCE WITH THE
TERMS AND CONDITIONS OF THIS CREDIT SHALL BE DULY HONORED IF PRESENTED TOGETHER
WITH DOCUMENT(S) AS SPECIFIED AND THE ORIGINAL OF THIS CREDIT, AT OUR OFFICE
LOCATED AT (BANK ADDRESS) ON OR BEFORE THE ABOVE STATED EXPIRY DATE. DRAFT(S)
DRAWN UNDER THIS CREDIT MUST SPECIFICALLY REFERENCE OUR CREDIT NUMBER.
EXCEPT AS OTHERWISE EXPRESSLY STATED HEREIN, THIS LETTER OF CREDIT IS SUBJECT TO
THE UNIFORM CUSTOMS AND PRACTICE FOR DOCUMENTARY CREDITS, ESTABLISHED BY THE
INTERNATIONAL CHAMBER OF COMMERCE, AS IN EFFECT ON THE DATE OF ISSUANCE OF THIS
CREDIT.
SINCERELY,
____________________________________
AUTHORIZED SIGNATURE OF BANK OFFICER
<PAGE> 1
Exhibit 10.28
================================================================================
AGREEMENT OF LEASE
between
PURCHASE CORPORATE PARK ASSOCIATES, L.P.
Landlord,
and
INTERLIANT, INC.
Tenant,
Dated: June 16, 1999
PREMISES:
THE CENTRE AT PURCHASE
TWO MANHATTANVILLE ROAD
PURCHASE, NEW YORK
A portion of the 1st Floor
================================================================================
<PAGE> 2
Interliant-I
<PAGE> 3
TABLE OF CONTENTS
Page
----
ARTICLE 1 PREMISES, COMMENCEMENT OF TERM, TERM AND RENT....................1
ARTICLE 2 LAYOUT AND FINISH................................................2
ARTICLE 3 TAX ESCALATION...................................................5
ARTICLE 4 EXPENSE ESCALATION..............................................10
ARTICLE 5 USE.............................................................17
ARTICLE 6 ALTERATIONS AND INSTALLATIONS...................................18
ARTICLE 7 REPAIRS.........................................................21
ARTICLE 8 REQUIREMENTS OF LAW.............................................23
ARTICLE 9 INSURANCE, LOSS, REIMBURSEMENT, LIABILITY.......................24
ARTICLE 10 LANDLORD'S LIABILITY............................................26
ARTICLE 11 ASSIGNMENT, MORTGAGING, SUBLETTING, ETC.........................27
ARTICLE 12 ELECTRICITY.....................................................31
ARTICLE 13 DAMAGE BY FIRE OR OTHER CAUSE...................................34
ARTICLE 14 CONDEMNATION....................................................36
ARTICLE 15 ACCESS TO DEMISED PREMISES; CHANGES.............................37
ARTICLE 16 DEFAULT.........................................................38
ARTICLE 17 RE-ENTRY BY LANDLORD, INJUNCTION................................40
ARTICLE 18 DAMAGES.........................................................41
ARTICLE 19 LANDLORD'S RIGHT TO PERFORM TENANT'S OBLIGATIONS................43
ARTICLE 20 QUIET ENJOYMENT.................................................44
ARTICLE 21 SERVICES AND EQUIPMENT..........................................44
ARTICLE 22 DEFINITIONS.....................................................47
ARTICLE 23 INVALIDITY OF ANY PROVISION.....................................48
ARTICLE 24 BROKERAGE.......................................................48
<PAGE> 4
ARTICLE 25 SUBORDINATION...................................................49
ARTICLE 26 CERTIFICATES OF LANDLORD AND TENANT.............................50
ARTICLE 27 LEGAL PROCEEDINGS WAIVER OF JURY TRIAL..........................52
ARTICLE 28 SURRENDER OF PREMISES...........................................52
ARTICLE 29 RULES AND REGULATIONS...........................................53
ARTICLE 30 CONSENTS AND APPROVALS..........................................53
ARTICLE 31 NOTICES.........................................................54
ARTICLE 32 NO WAIVER.......................................................55
ARTICLE 33 CAPTIONS........................................................56
ARTICLE 34 INABILITY TO PERFORM............................................56
ARTICLE 35 NO REPRESENTATIONS BY LANDLORD..................................56
ARTICLE 36 NAME OF THE BUILDING PROJECT....................................56
ARTICLE 37 RESTRICTIONS UPON USE...........................................56
ARTICLE 38 INDEMNITY.......................................................57
ARTICLE 39 SECURITY DEPOSIT................................................57
ARTICLE 40 MISCELLANEOUS...................................................58
ARTICLE 41 COMMON AREAS AND PARKING........................................60
ARTICLE 42 EXTENSION OF TERM...............................................62
EXHIBITS
EXHIBIT A SITE PLAN.......................................................A-1
EXHIBIT B DESCRIPTION OF LAND.............................................B-1
EXHIBIT C FLOOR PLAN......................................................C-1
EXHIBIT D THIS EXHIBIT HAS BEEN INTENTIONALLY DELETED.....................D-1
EXHIBIT E HVAC SPECIFICATIONS.............................................E-1
EXHIBIT F CLEANING SPECIFICATIONS.........................................F-1
EXHIBIT G RULES AND REGULATIONS...........................................G-1
EXHIBIT H THIS EXHIBIT HAS BEEN INTENTIONALLY DELETED.....................H-1
<PAGE> 5
AGREEMENT OF LEASE made as of this 16th day of June, 1999,
between PURCHASE CORPORATE PARK ASSOCIATES, L.P., a New York limited partnership
having an office at Two Manhattanville Road, Purchase, New York 10577
(hereinafter referred to as "LANDLORD") and INTERLIANT, INC., a Delaware
corporation having an office at 11 Martine Avenue, 12th Floor, White Plains, New
York 10606 (hereinafter referred to as "TENANT").
W I T N E S S E T H :
Landlord and Tenant hereto, for themselves, their heirs,
distributees, executors, administrators, legal representatives, trustees,
successors and assigns, hereby covenant and agree as follows:
ARTICLE 1
PREMISES, COMMENCEMENT OF TERM, TERM AND RENT
1.1 Landlord hereby leases to Tenant and Tenant hereby hires
from Landlord, subject to any ground leases and/or underlying leases and/or
mortgages as hereinafter provided, and upon and subject to the covenants,
agreements, terms, provisions and conditions of this Lease, in the building
designated Building A/B on the site plan annexed hereto as EXHIBIT A
(hereinafter referred to as the "BUILDING") on land (the "LAND") located in the
Town of Harrison, County of Westchester, State of New York and as more
particularly described in EXHIBIT B annexed hereto, in the office park commonly
known as "THE CENTRE AT PURCHASE", the following space: a portion of the first
(1st) floor designated on EXHIBIT C annexed hereto (the "DEMISED PREMISES"). The
term of this Lease shall commence on the date hereof (hereinafter referred to as
the "COMMENCEMENT DATE") and shall end on June 30, 2004 (hereinafter referred to
as the "EXPIRATION DATE") or until such term shall earlier cease and terminate
as hereinafter provided.
1.2 Tenant shall pay to Landlord a fixed annual rent ("FIXED
ANNUAL RENT") commencing on the date that is the earlier to occur of: (i) one
(1) month from the execution hereof or (ii) the date Tenant or anyone claiming
under or through Tenant first occupies the demised premises for the conduct of
its business, Tenant shall pay to Landlord a fixed annual rent ("FIXED ANNUAL
RENT") of Forty-Two Thousand Seven Hundred Ninety 50/100 Dollars ($42,790.50)
per year, for the period commencing on the Commencement Date and ending on the
Expiration Date.
<PAGE> 6
Tenant agrees to pay the fixed annual rent in lawful money of
the United States of America, in equal monthly installments in advance on the
first day of each calendar month during the term of this Lease, at the office of
Landlord or such other place in the United States of America as Landlord may
designate, without any setoff or deduction whatsoever, except such deduction as
may be occasioned by the occurrence of any event permitting or requiring a
deduction from or abatement of rent as specifically set forth in Articles 13 and
14 hereof.
1.3 Tenant shall pay the fixed annual rent and additional rent
as above and as hereinafter provided, by good and sufficient check (subject to
collection) drawn on a bank which is a member of the New York Clearinghouse
Association or another bank approved in writing by Landlord. Tenant is paying
the first month's rent upon the execution hereof. Fixed annual rent and the
monthly payments set forth in Section 4.4(b)(i) shall be paid when due in
accordance with the terms of this Lease. All other sums payable by Tenant
hereunder shall be payable within ten (10) days after written demand for same,
unless other payment dates are hereinafter provided. All sums other than fixed
annual rent payable by Tenant hereunder shall be deemed additional rent, the
default in the payment of which Landlord shall have the same remedies as for a
default in the payment of fixed annual rent.
1.4 If Tenant shall fail to pay when due any installment of
fixed annual rent for a period of ten (10) days after written notice is given to
Tenant that such installment shall have become due, or if Tenant shall fail to
pay any payment of additional rent for a period of ten (10) days after written
notice is given to Tenant that such payment shall have become due, then without
regard to any other remedies which Landlord may have as a consequence of such
default, Tenant shall pay interest thereon at the "INTEREST RATE" (as such term
is defined in Article 22 hereof), from the date when such installment shall have
become due or notice of such additional rent being due is given (as the case may
be) to the date of the payment thereof, and such interest shall be deemed
additional rent.
ARTICLE 2
LAYOUT AND FINISH
2.1 Tenant, at Tenant's cost and expense, and in a
professional and workmanlike manner, shall make and complete the work and
installations in and to the demised premises set forth below in such manner so
that the demised premises will be executive, general and administrative offices
appropriate for a first class office building in Westchester County, New York.
Tenant, at Tenant's expense, shall cause to be prepared
<PAGE> 7
a preliminary plan or set of plans (which said plan or set of plans, as the case
may be, are hereinafter called the "plan") which shall contain information
relating to the construction of the demised premises and the engineering in
connection therewith and any effect on building systems. The plan shall be
submitted by Tenant to Landlord for Landlord's approval, which approval shall
not unreasonably withheld or delayed and shall be based solely upon (i) the
effect of "Tenant's Work", as defined below, upon the A/B Building engineering
specifications and systems, (ii) potential for interference with the rights of
other tenants, (iii) compliance of the plan with Legal Requirements (but
Landlord's approval of the plan shall in no way be deemed a representation that
such plans comply with Legal Requirements and (iv) the effect of Tenant's Work
(as hereinafter defined) on the structure of the A/B Building (i.e., Tenant's
Work must not be structural in nature). If Landlord shall disapprove the plan,
Landlord shall set forth its reasons for such disapproval and itemize those
portions of the plan so disapproved. Landlord shall review and respond to
Tenant's plans within seven (7) days of its receipt of a set of detailed plans
and specifications and such other information as Landlord or its agents shall
reasonably (and promptly) request. In the event that Landlord fails to reject
such plans within said seven (7) day period, giving explicit reasons for such
rejection, Tenant's Plans shall be deemed approved. In the event that Landlord
timely refuses to consent to such plans as set forth above, Tenant shall
resubmit the changed plans and Landlord will then have five (5) days from its
receipt of the changed plans and specifications to approve or reject such plans,
using the criteria set forth above. In the event that Landlord fails to reject
such plans within said five (5) day period, giving explicit reasons for such
rejection, Tenant's Plans shall be deemed approved. If Landlord still rejects
such plans, the same procedure shall be used until Landlord's consent is
obtained. Landlord shall not be deemed unreasonable in withholding its consent
to the extent that the plan prepared by Tenant pursuant hereto involves the
performance of work or the installation in the demised premises of materials or
equipment which do not equal or exceed the standard of quality adopted by
Landlord for the Building.
Tenant shall have the right to revise the plan, provided
Tenant has received Landlord's prior written consent to such revision. Final
plans will be delivered to Landlord as they become available, for Landlord's
approval pursuant to this Section 2.1. Subject to Landlord's review of the
plans, Tenant shall not be required to remove Tenant's Work upon the expiration
of this Lease.
2.2 The following conditions shall also apply to Tenant's
Work:
(a) Tenant, at Tenant's expense, shall file all
<PAGE> 8
required architectural, mechanical and electrical drawings and obtain all
necessary permits, and shall furnish and perform all engineering and engineering
drawings in connection with Tenant's Work.
(b) Prior to Tenant's occupancy of any portion of the demised
premises for the conduct of Tenant's business, Tenant, at its expense, shall
procure a temporary certificate of occupancy for such portion. Thereafter,
Tenant shall diligently proceed to obtain a permanent certificate of occupancy.
Landlord agrees to cooperate with Tenant in obtaining all permits and
certificate pursuant to this Section 2.2, and, if requested, Landlord agrees to
join in applications therefor.
2.3 Landlord agrees to make a contribution ("Landlord's
Contribution") of Thirty-Three Thousand Three Hundred and 00/100 DOLLARS
($33,300.00) to pay to Tenant or directly to Tenant's contractors or
subcontractors, if any, as directed by Tenant for the cost of Tenant's Work.
Landlord's Contribution will be funded in two installments: one half within ten
(10) days after certification by Tenant to Landlord that Tenant's Work is fifty
percent (50%) complete, and the second half within ten (10) days after the
receipt by Landlord of (i) a certificate executed by Tenant's representative
that such Tenant's Work has been substantially completed in a manner
satisfactory to such parties, or that Tenant has occupied the Premises,
whichever is earlier, and (ii) final lien waivers from the contractors
performing such work. Tenant may apply the Landlord's Contribution to Tenant's
Work undertaken in connection with the lease of certain appurtenant space
entered into simultaneously herewith. Tenant's Work shall become the property of
Landlord and shall remain as part of the demised premises.
2.4 In accordance with the plan and such other plans and
specifications as may be approved by Landlord, and in compliance with Article 6
hereof, Landlord at the request of and on behalf of Tenant, at Tenant's expense,
(subject to Tenant's approval) shall make and complete, or cause to be made and
completed, in and to the demised premises the work and installations (herein
called "Tenant's Work") specified in such plans. Total Cost for Tenant's Work
shall not exceed the actual costs of such work (which may include architect's
fees, engineering fees and costs incurred in connection with obtaining any
required permits) plus Landlord's fee of ten (10%) percent of the actual cost.
ARTICLE 3
TAX ESCALATION
<PAGE> 9
3.1 Tenant shall pay to Landlord, as additional rent, tax
escalation in accordance with the provisions of this Article.
3.2 Definitions:
(a) the term "TAX YEAR" shall mean each period of twelve
months, commencing on the first day of January, in which occurs any part of the
term of this Lease;
(b) the term the "A/B BUILDING" or "BUILDING A/B" shall mean
the Building;
(c) the term the "LAND" shall have the meaning set forth in
Article 1.1.;
(d) the term "COMPARATIVE YEAR" shall mean the calendar year
commencing on January 1, 1999 and each subsequent calendar year;
(e) the term "LAND TAXES" shall mean the total of all real
estate and other taxes and special, general, extraordinary or other assessments,
sewer rents, water charges, occupancy taxes, school taxes, and other taxes or
charges of any kind or nature levied, assessed, imposed or attributable at any
time by any governmental authority (including without limitation any town, city,
district, county, village, school district or public transportation authority)
upon or against the Land, and also any tax, assessment, or charge, levied,
assessed or imposed at any time by any governmental authority in connection with
the receipt of income or rents from the Land to the extent that same shall be in
lieu of all or a portion of any of the aforesaid taxes, assessments or charges,
or additions or increases thereof. 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 the Land Taxes, then such franchise, income, transit, profit or other tax or
governmental imposition shall be deemed to be included within the definition of
"LAND TAXES" for the purposes hereof. The term "Land Taxes" shall not be deemed
to include (i) gift or inheritance taxes, (ii) corporate franchise taxes or
similar business taxes imposed on noncorporate business entities, (iii) realty
transfer taxes or real property transfer gains taxes imposed in connection with
the sale of or the lease of all or substantially all of the Land or the A/B
Building, Building C or Building D (as designated on EXHIBIT A), (iv) mortgage
recording taxes or (v) income taxes, except with respect to any such taxes
assessed or imposed in lieu of real estate taxes or any portion thereof. As to
special assessments which are payable over a period of time extending beyond the
term
<PAGE> 10
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 Land Taxes. If, by law, any assessment shall be payable in
installments, then, for the purposes hereof (i) such assessment shall be deemed
to have been payable in the maximum number of installments permitted by law and
(ii) there shall be included in Land Taxes, for each Tax Year in which such
installments may be paid, the installments of such assessment so becoming
payable during such Tax Year, together with interest payable during such Tax
Year;
(f) the term "BUILDING TAXES" shall have the meaning set forth
in (e), above, except that the phrases "Land Taxes" and "Land" shall be changed
to read "Building Taxes" and the "Building", respectively;
(g) the term "LAND TAX BASE FACTOR" shall mean the amount of
Taxes attributable to the Land for the calendar year 1999;
(h) the term "BUILDING TAX BASE FACTOR" shall mean the
Building Taxes for the calendar year 1999;
(i) the term "THE BUILDING PROJECT" shall mean the Land with
all the improvements thereon (including, without limitation, the office
building(s) and parking areas erected thereon);
(j) the term "THE LAND PERCENTAGE," for purposes of computing
the Tax Escalation Payments (as hereinafter defined) to be made pursuant to this
Article 3 and the Expense Payments (as hereinafter defined) to be made pursuant
to Article 4, shall (subject to the provisions of Article 3.10 hereof) mean
three tenths of one percent (.3%). The Land 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 rentable square foot
area of the office building(s) comprising the Building Project. The parties
agree that the rentable square foot area of the demised premises shall be deemed
to be 1,665 rentable square feet and that the rentable square foot area of the D
Building shall be deemed to be 190,137, the rentable square foot area of the
building designated Building C on EXHIBIT A annexed hereto shall be deemed to be
86,804, the rentable square foot area of the building designated Building A/B on
EXHIBIT A annexed hereto shall be deemed to be 281,837, and that the total
rentable square foot area of all the office building(s) comprising a part of the
Building Project shall be deemed to be 558,778 rentable square feet. Tenant
acknowledges that the Land Percentage will be adjusted in the event that the
rentable area of the office space comprising the
<PAGE> 11
Building Project shall be increased or reduced.
(k) the term "THE BUILDING PERCENTAGE," for purposes of
computing the Tax Escalation Payments (as hereinafter defined) to be made
pursuant to this Article and the Expense Payments (as hereinafter defined],
shall mean fifty-nine one hundredths of one percent (.59%). The Building
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 rentable square foot area of the A/B Building. The parties agree
that the rentable square foot area of the demised premises shall be deemed to be
1,665 rentable square feet and that the total rentable square foot area of the
A/B Building shall be deemed to be 281,837 rentable square feet;
(l) the term "TAX ESCALATION STATEMENT" shall mean a written
statement setting forth the amount payable by Tenant for a specified Comparative
Year pursuant to this Article, which Tax Escalation Statement shall be
accompanied by a copy of the applicable tax bills from the taxing authorities
when available; and
(m) the term "TAXES" shall mean collectively the Land Taxes
and the Building Taxes.
3.3 In the event that the Land Taxes payable for any
Comparative Year shall exceed the Land Tax Base Factor, Tenant shall pay a tax
escalation to Landlord, as additional rent for such Comparative Year, in an
amount equal to the Land Percentage of the excess. In the event that the
Building Taxes payable for any Comparative Year shall exceed the Building Tax
Base Factor, Tenant shall pay a tax escalation to Landlord as additional rent
for such Comparative Year, in an amount equal to the Building Percentage of such
excess. Any such amounts being payable by Tenant pursuant to this Section 3.3
are hereinafter called the "TAX ESCALATION PAYMENT." Before or after the start
of each Comparative Year, Landlord shall furnish to Tenant a Tax Escalation
Statement of the Taxes payable for such Comparative Year or reasonable estimates
thereof if bills are not yet available. If the Land Taxes payable or estimated
to be payable for such Comparative Year exceed the Land Tax Base Factor,
additional rent for such Comparative Year in an amount equal to the Land
Percentage of the excess shall be due from Tenant to Landlord after Landlord has
furnished Tenant with the Tax Escalation Statement. If the Building Taxes
payable or estimated to be payable for such Comparative Year exceed the Building
Tax Base Factor, additional rent for such Comparative Year in an amount equal to
the Building Percentage of the excess shall be due from Tenant to Landlord after
Landlord has furnished Tenant with the Tax Escalation Statement. Tenant agrees
to make payments on account of the additional rent for each Comparative
<PAGE> 12
Year in twelve (12) monthly installments, each in an amount equal to one-twelfth
(1/12) of the Tax Escalation Payment, which installments may be adjusted by
Landlord as bills are received for which estimates were used. If, as finally
determined, the amount of additional rent payable by Tenant to Landlord pursuant
to this Section 3.3 for a Comparative Year shall be greater than (resulting in
an underpayment) or be less than (resulting in an overpayment) the aggregate of
all the installments so paid on account to Landlord by Tenant for such
Comparative Year, then, promptly after the receipt of the Tax Escalation
Statement for such Comparative Year and, in performance of its obligations under
this Article, Tenant shall, in the case of such an underpayment, pay to Landlord
an amount equal to such underpayment with interest thereon at the Interest Rate
or Landlord shall, in the case of such an overpayment, either (i) pay to Tenant
an amount equal to such overpayment with interest thereon at the Interest Rate
or (ii) credit against the next installment(s) of fixed annual rent due from
Tenant an amount equal to such overpayment with interest at the Interest Rate.
If a Tax Escalation Statement is furnished to Tenant after the commencement of
the Comparative Year in respect of which such Tax Escalation Statement is
rendered, Tenant shall, within fifteen (15) days thereafter pay to Landlord an
amount equal to those installments of the total Tax Escalation Payment payable
as provided in this Section 3.3 during the period prior to the first day of the
month next succeeding the month in which the applicable statement has been
furnished.
3.4 If, after Tenant shall have made a payment of additional
rent under this Article, the Taxes payable for any Comparative Year on which
such payment of additional rent shall have been based shall be changed, then the
amount payable for that Comparative Year shall be revised to reflect such change
and appropriate adjustments promptly made between Landlord and Tenant. If, after
Tenant shall have made a payment of additional rent under this Article, Landlord
shall receive a refund of any portion of the Taxes payable for any Comparative
Year on which such payment of additional rent shall have been based, as a result
of a reduction of such Taxes by final determination of legal proceedings,
settlement or otherwise, Landlord shall either (i) after receiving the refund
pay to Tenant the Land or Building Percentage, as the case may be, of the refund
or (ii) credit against the next installment(s) of fixed annual rent due from
Tenant an amount equal to the Land or Building Percentage of the refund, as the
case may be.
3.5 The Tax Escalation Statement to be furnished by Landlord
as provided in this Article shall constitute a final determination as between
Landlord and Tenant of the Tax Escalation Payment for the periods represented
thereby unless Tenant shall have paid the amount thereof and, within sixty (60)
days after the Tax Escalation Statement is furnished, shall give
<PAGE> 13
a notice to Landlord that it disputes its accuracy or its appropriateness which
notice shall specify the particular respects in which the Tax Escalation
Statement is inaccurate or inappropriate. Copies of the tax bills and the
relevant records in the tax assessor's office shall be deemed prima facie
evidence of the facts set forth on the Tax Escalation Statement.
3.6 In no event shall the fixed annual rent under this Lease
be reduced by virtue of this Article.
3.7 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 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. Such 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 due from Tenant, as aforesaid, and Landlord and Tenant shall
thereupon make appropriate adjustments of amounts then owing.
3.8 Landlord's and Tenant's obligation to make the adjustments
referred to in Section 3.3 hereof above shall survive any expiration or
termination of this Lease. After the termination of the Lease, the final
adjustment for the Tax Escalation Payment pursuant to this Article 3 shall be
made as soon as practicable, and if Landlord retains any moneys of Tenant due to
excess payments made by Tenant hereunder, such excess moneys shall be promptly
refunded to Tenant after such final adjustment has been made.
3.9 Any delay or failure of Landlord to bill any Tax
Escalation Payment as provided in this Article 3 shall not constitute a waiver
of or in any way impair the continuing obligation of Tenant to pay such Tax
Escalation Payment.
3.10 Notwithstanding any other provision of this Article 3 to
the contrary, if the parcel of land on which any of the buildings comprising a
part of the Building Project shall be assessed as a separate tax lot, the Land
Percentage and the Land Tax Base Factor shall be appropriately adjusted.
ARTICLE 4
EXPENSE ESCALATION
4.1 Tenant shall pay to Landlord, as additional rent,
<PAGE> 14
expense escalation in accordance with this Article.
4.2 Definitions:
(a) the term "BUILDING EXPENSE BASE FACTOR" shall mean the
amount of Building Expenses incurred for the calendar year 1999;
(b) the term "NON-BUILDING EXPENSE BASE FACTOR" shall mean the
amount of Non-Building Expenses incurred for the calendar year 1999;
(c) the term "EXPENSE ESCALATION STATEMENT" shall mean a
written statement setting forth the amount payable by Tenant for a specified
Comparative Year pursuant to this Article;
(d) the term "BUILDING EXPENSES" shall mean the total amount
of all costs and expenses incurred or paid by Landlord with respect to and in
connection with the operation, maintenance, replacement and/or normal operating
repair of the Building, including, without limitation, the cost incurred for (i)
air conditioning; (ii) mechanical ventilation; (iii) heating; (iv) cleaning
comparable to the Cleaning Specifications annexed as EXHIBIT F; (i) rubbish
removal; (ii) window washing (interior and exterior, including inside
partitions); (iii) elevators; (iv) escalators; (v) porter and matron service;
(vi) electric current including electricity for heating, ventilation,
air-conditioning and exterior lighting to the Building and the parking areas
appurtenant thereto (excluding, however, the cost of any electricity in the
Building directly metered to tenants or otherwise allocable to space in the
Building demised to tenants); (vii) oil, purchased steam or any other fuel
consumed at the Building; (viii) protection and security; (ix) ordinary
maintenance (including but not limited to regular painting of non-tenanted areas
at the Building); (x) maintenance and repair of lobby decorations; (xi) interior
landscape work and maintenance; (xii) premiums for fire, extended coverage, any
boiler, sprinkler, apparatus, war risk (if expressly required by mortgagee of
Landlord) and property damage insurance, rental and plate glass insurance and
any other insurance required by a mortgagee of Landlord; (xiii) supplies; (xix)
wages, salaries, disability benefits, pensions, hospitalization, retirement
plans and group insurance respecting service and maintenance employees of
Landlord; (xx) uniforms and working clothes for such employees and the cleaning
thereof; (xxi) expenses imposed on Landlord pursuant to law or to any collective
bargaining agreement with respect to such employees; (xxii) worker's
compensation insurance, payroll, social security, unemployment and other taxes
with respect to such employees; (xxiii) sales, utility and use taxes and other
taxes of like import related to services rendered or products purchased for
common areas of the Building; (xxiv)
<PAGE> 15
water rates and sewer rates; (xxv) all operating charges incurred by any
superintendent's and manager's offices in the operation and maintenance of the
Building; (xxvi) charges for maintenance and service contracts for all areas of
the Building; (xxvii) all other operating costs and expenses of repair,
operation and maintenance of the Building excluding fines or penalties caused by
Landlord's negligent acts or omissions or ; (xxviii) the fees of the manager and
superintendent, their assistants and any clerical staff working for such
superintendent or manager whose duties are connected with the maintenance and
operation of the Building; (xxix) reasonable professional and consulting fees,
including legal and audit fees; the expenses, including payments to attorneys,
appraisers and other experts incurred by Landlord in connection with any
application or proceeding wherein Landlord obtains or seeks to obtain reduction
or refund of the Taxes payable or paid upon or against the Building; (xxx)
whether or not capitalized under generally accepted accounting principles, the
cost of repairs and the cost of replacements made in connection with repairs of
cables, fans, pumps, boilers, cooling equipment, wiring the electrical fixtures
and metering, control and distribution equipment, window washing equipment and
snow removal equipment, and component parts of the HVAC, electrical, plumbing,
elevator and any life or property protection systems (including, without
limitation, sprinkler systems); and (xxxi) managing agents' fees comparable to
those charged by other managing agents in Westchester County who manage similar
building projects, or if Landlord elects to manage (or have an affiliate manage)
the Building, an annual fee, for management of the Building, in an amount equal
to three percent (3%) of the rental revenues received by Landlord from the
Building for the Comparative Year in question.
Provided, however, that the following items shall be excluded from Building
Expenses:
(i) leasing commissions;
(ii) cost of repairs or replacements incurred by reason of fire or
other casualty (to the extent that Landlord is compensated therefor through
proceeds of insurance above deductible amounts), or caused by the exercise
of the right of eminent domain (to the extent the same is covered by any
condemnation award);
(iii) Taxes;
(iv) "Non-Building Expenses", as that term is hereinafter defined;
(v) costs incurred in performing work or furnishing services to or
for individual tenants (including this Tenant) at such tenant's expense;
and costs of performing
<PAGE> 16
work or furnishing services for tenants other than this Tenant at
Landlord's expense, to the extent that such work or service is in excess of
any work or service Landlord is obligated to furnish to or for this Tenant
at Landlord's expense;
(vi) expenditures for capital improvements other than those that are
(a) specifically included in the definition of Building Expenses; or (b)
included as Building Expenses pursuant to the provisions of Section 4.3(a)
or (b);
(vii) that portion of any cost or expense relating to the Building and
to other buildings or properties owned by Landlord, which is properly
allocable or attributable to such other buildings or properties unless
otherwise provided in this Lease;
(viii) debt service on any mortgages encumbering the Building, or
depreciation of the Building;
(ix) the cost for those services provided to other tenants in the
Building which services are not also provided to Tenant; and
(x) any unpaid rent relating to any space in the Building.
(e) "NON-BUILDING EXPENSES" shall mean the total of public
liability insurance and all the costs and expenses incurred or borne by Landlord
in connection with the operation, maintenance, replacement and/or normal
operating repairs of the Land and "Common Areas" (as that term is hereinafter
defined) including, without limitation, the cost incurred for snow and ice
removal, grading, striping and repair of parking lot surfaces; cleaning,
exterior landscaping, and maintenance, installation, repair and replacement of
signage, traffic control devices and signs; security, ordinary maintenance,
charges for maintenance and service contracts; repair and replacement (other
than capital replacements unless specifically included herein) and improvements
which are appropriate for the operation of the Common Areas of a first class
office building project in Westchester County, New York; all normal operating
charges incurred by any superintendent's and manager's offices in the operation
and maintenance of the Common Areas; the fees of the manager and superintendent,
their assistants and any clerical staff working for such manager or
superintendent whose duties are connected with the operation and maintenance of
the Common Areas; whether or not capitalized under generally accepted accounting
principles, the cost of repairs and the cost of replacements made in connection
with repairs of Common Area cables, fans, pumps, boilers, cooling equipment,
wiring and electrical fixtures and
<PAGE> 17
metering, control and distribution equipment, component parts of the HVAC,
electrical, plumbing, elevator and any life or property protection systems
(including, without limitation, sprinkler systems), window washing equipment and
snow removal equipment;
Provided, however that the following items shall be excluded from Non-Building
Expenses:
(i) Building Expenses;
(ii) Taxes;
(iii) expenditures for capital improvements other than those that are
(a) specifically included in the definition of Non-Building Expenses or (b)
included as Non-Building Expenses pursuant to the provisions of Sections
4.3(a) or (b);
(iv) that portion of any cost or expense relating to both the Common
Areas and to other buildings or properties owned by Landlord, which is
properly allocable or attributable to such other buildings or properties
unless otherwise provided in this Lease; and
(v) debt service on any mortgages encumbering the Common Areas, or
depreciation of any portion of the Common Areas.
(f) The term "EXPENSES" shall mean the Building Expenses and
Non-Building Expenses.
(g) Landlord represents that the definitions of "Expenses",
"Building Expenses", and "Non-Building Expenses" are substantially consistent
with the corresponding provisions of the
other leases of space in the Building.
4.3 (a) If Landlord shall purchase any item of capital
equipment or make any capital expenditure designed to result in savings or
reductions in expenses, the costs for same shall be included in Expenses. If
Landlord shall lease any such item of capital equipment designed to result in
savings or reductions in Expenses, then the rentals and other costs paid
pursuant to such leasing shall be included in Expenses for the Comparative Year
in which they were incurred.
(b) If Landlord shall purchase any item of capital equipment
or make any other capital expenditure in order to comply with Legal
Requirements, then the costs for same shall be included in Expenses for the
Comparative Year in which the costs are incurred and subsequent Comparative
Years, on a straight line basis, amortized over the lesser of (i) fifteen (15)
years, or
<PAGE> 18
(ii) the useful life of such items. If Landlord shall lease any such item of
capital equipment to comply with Legal Requirements then the rentals and other
costs paid pursuant to such leasing shall be included in Expenses for the
Comparative Year in which they were incurred. If during all or part of any
Comparative Year, Landlord shall not furnish any particular item(s) of work or
service (which would constitute an element of Expense hereunder) to portions of
the Building or the Common Areas due to the fact that such portions are not
occupied or leased, or because such item of work or service is not required or
desired by the tenant of such portion, or such tenant is itself obtaining and
providing such item of work or service, or for other reasons, then, for the
purposes of computing the additional rent payable hereunder, the amount of the
expenses for such item for such period shall be deemed to be increased by an
amount equal to the additional operating and maintenance expenses which would
reasonably have been incurred during such period by Landlord if it had at its
own expense furnished such item of work or services to such portion of the
Building or the Common Areas.
4.4 (a) If the Building Expenses for any Comparative Year
shall be greater than the Building Expense Base Factor, Tenant shall pay to
Landlord, as additional rent for such Comparative Year, in the manner
hereinafter provided, an amount equal to the Building Percentage of the excess
of the Building Expenses for such Comparative Year over the Building Expense
Base Factor. If the Non-Building Expenses for any Comparative Year shall be
greater than the Non-Building Expense Base Factor, Tenant shall pay to Landlord,
as additional rent for such Comparative Year, in the manner hereinafter
provided, an amount equal to the Land Percentage of the excess of the
Non-Building Expenses for such Comparative Year over the Non-Building Expense
Base Factor. The amounts payable by Tenant under this Section 4.4(a) are,
collectively, the "EXPENSE PAYMENT."
(b) (i) Following the expiration of each Comparative Year,
Landlord shall submit to Tenant an Expense Escalation Statement, certified by
Landlord, setting forth the Expenses for the preceding Comparative Year and the
Expense Payment, if any, due to Landlord from Tenant for such Comparative Year.
The rendition of such Expense Escalation Statement to Tenant shall constitute
prima facie proof of the accuracy thereof and, if such statement shows an
Expense Payment due from Tenant to Landlord with respect to the preceding
Comparative Year then (A) Tenant shall make payment of any unpaid portion
thereof within twenty (20) days after receipt of such Expense Escalation
Statement; (B) Tenant shall also pay to Landlord, as additional rent, within
twenty (20) days after receipt of such Expense Escalation Statement, an amount
equal to (x) the product obtained by multiplying the total Expense Payment for
the preceding Comparative Year by a fraction, the denominator of which shall be
twelve (12) and the numerator of which shall be the number of
<PAGE> 19
months of the current Comparative Year which shall have elapsed prior to the
first day of the month immediately following the rendition of such Expense
Escalation Statement less (y) the aggregate amount of Expense Payment paid by
Tenant for such elapsed months; and (C) Tenant shall also pay to Landlord, as
additional rent, commencing as of the first day of the month immediately
following the rendition of such Expense Escalation Statement and on the first
day of each month thereafter until a new Expense Escalation Statement is
rendered, one-twelfth (1/12) of the total Expense Payment for the preceding
Comparative Year. The aforesaid monthly payments based on the total Expense
Payment for the preceding Comparative Year shall be adjusted to reflect, as
reasonably estimated by Landlord, increases in rates and amounts, for the
current Comparative Year, applicable to the categories involved in computing
Expenses, whenever such increases become reasonably known or anticipated prior
to or during such current Comparative Year. The payments required to be made
under clauses (B) and (C) of this subsection 4.4(b). shall be credited toward
the Expense Payment due from Tenant for the then-current Comparative Year,
subject to adjustment as and when the Expense Escalation Statement for such
current Comparative Year is rendered by Landlord.
(ii) The Expense Escalation Statement to be furnished by
Landlord shall constitute a final determination as between Landlord and Tenant
of the Expenses for the periods represented thereby, unless Tenant shall have
paid the Expense Payment and, within sixty (60) days after it is furnished,
shall give a notice to Landlord that it disputes its accuracy or its
appropriateness, which notice shall specify the particular respects in which the
Expense Escalation Statement is inaccurate. Pending the resolution of such
dispute, Tenant shall pay the additional rent to Landlord in accordance with the
Expense Escalation Statements furnished by Landlord. After payment of said
additional rent, Tenant's certified public accountant shall have the right,
during reasonable business hours and upon not less than five (5) business days'
prior written notice to Landlord, to examine Landlord's books and records with
respect to the foregoing (which Landlord shall maintain in either Westchester
County or New York County for three (3) years subsequent to the Escalation Year
to which they relate) and, at Tenant's expense, to make copies thereof, provided
such examination is commenced within sixty (60) days and concluded within one
hundred twenty (120) days following the rendition of the Expense Escalation
Statement in question. Landlord shall cooperate with Tenant in any such
examination of its books and records and shall, if requested by Tenant in
writing, make a member of its staff available to explain any entries in such
books and records.
(iii) Any such dispute as to an Expense Escalation Statement
referred to in subsection 4.4(b)(i) hereof
<PAGE> 20
shall be resolved by arbitration in accordance with the Commercial Arbitration
Rules of the American Arbitration Association, except that the arbitration shall
be by three (3) arbitrators each of whom shall be a certified public accountant.
Except as hereinafter provided in this paragraph, the cost of such arbitration
shall be split equally between Landlord and Tenant. If the arbitrators decide
that the Expense Payment shown on the Expense Escalation Statement was
overstated by more than ten (10%) percent, then Landlord shall pay the cost of
such arbitration. If the arbitrators decide that the Expense Payment shown on
the Expense Escalation Statement was understated by more than ten percent (10%),
then Tenant shall pay the cost of such arbitration.
4.5 In no event shall the fixed annual rent under this Lease
be reduced by virtue of this Article.
4.6 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 cause an Expense Escalation Statement of the
Expenses for that Comparative Year to be prepared and furnished to Tenant.
Landlord and Tenant shall thereupon make appropriate adjustments of amounts then
owing.
4.7 Landlord's and Tenant's obligation to make the adjustments
referred to in Section 4.6 hereof shall survive any expiration or termination of
this Lease.
4.8 Any delay or failure of Landlord in billing any Expense
Payment hereinabove or hereinafter provided shall not constitute a waiver of or
in any way impair the continuing obligation of Tenant to pay such expense
escalation hereunder.
4.9 Landlord and Tenant agree that in the event of any
overpayment or underpayment of any Expense Payment, the amount of any excess to
be credited to Tenant, or the amount of any deficiency to be paid by Tenant
shall be credited or paid with interest thereon computed at the Interest Rate
from the date such deficiency was due, or such overpayment was made until,
respectively, the date paid or credited.
4.10 Tenant acknowledges that the Building Project includes
Building A/B, Building C and Building D. If the operation of Building A/B and/or
Building C is combined with the
<PAGE> 21
operation of the D Building, so that Building Expenses include such items with
respect to all of such buildings, (a) the "BUILDING PERCENTAGE" (for the
purposes of this Article 4, only) shall be reduced to reflect the percentage
which the rentable square foot area of the demised premises bears to the total
rentable square foot area of the Building and such included building(s), and (b)
the Building Expense Base Factor shall be increased to reflect the amount of
Building Expenses incurred for calendar year 1999 for the Building and such
included building(s).
ARTICLE 5
USE
5.1 The demised premises shall be used solely as and for
executive and general offices and for no other purpose.
5.2 Tenant shall not use or permit the use of the demised
premises or any part thereof in any way which would violate any of the
covenants, agreements, terms, provisions and conditions of this Lease or for any
unlawful purposes or in any unlawful manner or in violation of the certificate
of occupancy or other certificate or permit for the demised premises or the
Building, and Tenant shall not suffer or permit the demised premises or any part
thereof to be used in any manner or anything to be done therein or anything to
be brought into or kept therein which, in the reasonable judgment of Landlord,
shall in any way impair or tend to impair the character, reputation or
appearance of the Building as a high quality office building, impair or
interfere with or tend to impair or interfere with any of the Building services
or the proper and economic heating, cleaning, air conditioning or other
servicing of the Building or the demised premises, or impair or interfere with
or tend to impair or interfere with the use of any of the other areas of the
Building by, or occasion discomfort, inconvenience or annoyance to, any of the
other tenants or occupants of the Building.
5.3 If Tenant uses any portion of the demised premises for the
preparation or consumption of food, Tenant shall pay to Landlord the cost of
employing, on a regular basis, an exterminator to keep the demised premises free
from vermin. Tenant shall cause all food preparation areas to be properly
ventilated so that no odor shall emanate from the demised premises to any other
portion of the Building, and shall bag all wet garbage and place the same in
containers that prevent the escape of odor.
5.4 Tenant shall have access to the demised premises on a
24-hour basis, 7 days per week.
<PAGE> 22
ARTICLE 6
ALTERATIONS AND INSTALLATIONS
6.1 Except for the Tenant's Work, Tenant shall make no
alterations, installations, additions or improvements (such work hereinafter
collectively referred to as "ALTERATIONS") in or to the demised premises without
Landlord's prior written consent and then only by contractors or mechanics first
approved by Landlord. All Alterations shall be done at Tenant's sole cost and
expense, and at such times and in such manner as Landlord may from time to time
reasonably designate.
Tenant may from time to time during the term of this lease, at
its expense, make non-structural cosmetic changes, which cost less than
Twenty-Five Thousand 00/100 Dollars ($25,000.00), without Landlord's prior
consent.
Tenant shall obtain and deliver to Landlord written,
unconditional waivers of mechanic's or other liens on the real property in which
the demised premises are located, signed by all architects, engineers,
contractors, mechanics and designers involved in such Alterations as and when
such architects, engineers, contractors, mechanics and designers are paid for
their work in connection therewith.
Any Alterations in the demised premises shall be effected
solely in accordance with the plans and specifications approved by Landlord.
Tenant shall reimburse Landlord promptly upon demand for any reasonable
out-of-pocket costs and expenses incurred by Landlord in connection with
Landlord's review of such Tenant's plans and specifications. Landlord will not
unreasonably withhold or delay its consent for nonstructural Alterations
(provided they will not affect the outside of the Building or the demised
premises or adversely affect the Building's structure, electrical, HVAC,
plumbing, mechanical or other systems). Prior to granting its consent to
Alterations, Landlord may impose such conditions as to guarantee of completion
and payment and of restoration as Landlord may reasonably consider desirable.
Any such approved Alterations shall be performed in accordance
with the foregoing and the following provisions of this Article 6:
(a) All Alterations shall be done in a professional and
workmanlike manner.
<PAGE> 23
(b) (1) In the event Tenant shall employ any contractor to do
in the demised premises any Alterations permitted by this Lease, such contractor
and any subcontractor shall agree to employ only such labor as will not result
in jurisdictional disputes or strikes or result in causing disharmony with other
workers employed at the Building. Tenant will inform Landlord in writing of the
names of any contractor or subcontractor Tenant proposes to use in the demised
premises at least ten (10) days prior to the beginning of work by such
contractor or subcontractor, but such information given to Landlord shall in no
way constitute Landlord's approval of such contractor or subcontractor.
(2) Tenant covenants and agrees to pay to its
contractor(s), as the work progresses, the entire cost (less a reasonable
retainage) of supplying the materials and performing the work shown on Tenant's
approved plans and specifications in accordance with Tenant's contract or
contracts with such contractor(s).
(c) All such Alterations shall be effected in compliance with
all applicable laws, ordinances, rules and regulations of governmental bodies
having or asserting jurisdiction in the demised premises and all applicable
insurance rules and regulations.
(d) Tenant shall keep the Building Project 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 on Tenant's behalf, and all
work to be performed by Tenant shall be done in a manner which will not
unreasonably interfere with or disturb other tenants or occupants of the
Building.
(e) During the progress of the work to be done by Tenant, said
work shall be subject to inspection by representatives of Landlord which, upon
reasonable notice, shall be permitted access and the opportunity to inspect, at
all reasonable times, but this provision shall not in any way whatsoever create
any obligation on Landlord to conduct such an inspection or create any
obligations or liability (or relieve Tenant of any obligations under this Lease)
in the event Landlord does conduct such an inspection.
(f) Prior to commencement of any work, Tenant or Tenant's
contractor(s) shall furnish to Landlord certificates evidencing the existence
of:
(i) worker's compensation insurance covering all persons
employed for such work; and
(ii) contractor's comprehensive general
<PAGE> 24
liability and property damage insurance naming Landlord, any of its
mortgagees and ground lessors and Tenant as insureds, with coverage
of at least $3,000,000 combined single limit.
6.2 Any mechanic's lien, filed against the demised premises or
the Building or the Building Project for work claimed to have been done for or
materials claimed to have been furnished to Tenant shall be discharged by Tenant
at its expense within thirty (30) days after notice of such filing, by payment,
filing of the bond required by law or otherwise. Notice is hereby given that
Landlord shall not be liable for any labor or materials furnished or to be
furnished to Tenant upon credit, and that no mechanic's or other lien for any
such labor or materials shall attach to or affect the reversion or other estate
or interest of Landlord in and to the demised premises.
6.3 All work, installations and improvements made and
installed by solely Landlord shall be the property of Landlord and shall remain
upon and be surrendered with the demised premises as a part thereof at the end
of the term of this Lease; provided, however, that Landlord's contribution shall
not grant Landlord any title or claim to title to Tenant's Work.
6.4 All Alterations, made and installed by Tenant, or at
Tenant's expense, upon or in the demised premises shall become and be the
property of Landlord, and shall remain upon and be surrendered with the demised
premises as a part thereof at the end of the term of this Lease. Notwithstanding
the foregoing, Tenant shall remove all Alterations which in Landlord's
reasonable judgment are of a non-Building Standard nature, such as internal
stairways, slab openings, special electronic data processing or communications
installations, vaults and raised floors, at or before the Expiration Date or
within fifteen (15) business days after any earlier termination date, and Tenant
shall repair or pay the cost of repairing any damage to the demised premises or
Building resulting from the removal thereof and restoring the demised premises
to their condition prior to the installation thereof unless at the time of
installation, Tenant shall have requested and obtained Landlord's waiver of the
removal of such Alterations.
6.5 Where furnished by or at the expense of Tenant all
furniture, furnishings and trade fixtures, including, without limitation,
murals, business machines and equipment, telecommunications equipment and
cabling, counters, screens, grille work, special paneled doors, cages,
partitions, metal railings, closets, panelling, lighting fixtures and equipment,
drinking fountains, refrigeration and air handling equipment, and any other
movable property shall remain the property of Tenant which may at its option
remove all or any part thereof at any time prior to the expiration of the term
of this Lease.
<PAGE> 25
6.6 If any Alterations or other property which Tenant shall
have the right to remove or be requested by Landlord to remove as provided in
Article 6.4 or 6.5 hereof (hereinafter called "TENANT'S PROPERTY") are not
removed on or prior to the expiration of the term of this Lease, Landlord shall
have the right to remove Tenant's Property and to dispose of the same without
accountability to Tenant and at the sole cost and expense of Tenant. Landlord
shall endeavor to give notice to Tenant that Tenant may remove such Tenant's
Property within five (5) days of the date stated therein; provided that
Landlord's failure to give such notice shall not give rise to any claim against
or liability on Landlord's part. In case of any damage to the demised premises
or Building resulting from the removal of Tenant's property, Tenant shall repair
such damage or, in default thereof, shall reimburse Landlord for Landlord's cost
in repairing such damage. This obligation shall survive any termination of this
Lease.
6.7 Tenant shall keep records of Tenant's Alterations costing
in excess of $50,000, and of the cost thereof for a period of five (5) years
after the completion thereof. Tenant shall, within forty-five (45) days after
demand by Landlord, furnish to Landlord copies of such records and cost if
Landlord shall require the same in connection with any proceeding to reduce the
assessed valuation of the A/B Building, Building C or Building D or any other
tax or charge, or in connection with any proceeding instituted pursuant to
Articles 13 or 14 hereof.
ARTICLE 7
REPAIRS
7.1 Tenant shall, at its sole cost and expense, make such
repairs to the demised premises and the fixtures and appurtenances therein as
are necessitated by the reckless or negligent acts or omissions of Tenant or by
the use of the demised premises in a manner contrary to the purposes for which
same are leased to Tenant as set forth in Section 5.1, as and when needed to
preserve them in good working order and condition subject to normal wear and
tear and damage by fire or other casualty. All damage or injury to the demised
premises and to its fixtures, appurtenances and equipment or to the Building or
to its fixtures, appurtenances and equipment caused by Tenant moving property in
or out of Building or by installation or removal of furniture, fixtures or other
property by or on behalf of Tenant, shall be repaired, restored or replaced
promptly by Tenant at its sole cost and expense, which repairs, restorations and
replacements shall be in quality and class equal to the original work or
installations. If Tenant fails to make such repairs, restoration or
replacements, within ten (10) days after Landlord gives Tenant written notice of
the necessity thereof,
<PAGE> 26
the same may be made by Landlord at the expense of Tenant and such expense shall
be collectible as additional rent and shall be paid by Tenant within thirty (30)
days after rendition of a bill therefor.
The exterior walls of the Building, the portions of any
windowsills outside the windows, and the windows are not part of the premises
demised by this Lease and Landlord reserves all rights to such parts of the
Building.
7.2 Tenant shall not place a load upon any floor of the
demised premises exceeding fifty (50) pounds per useable square foot live load,
and if Tenant shall desire a floor load in excess of such floor load, Landlord
agrees to strengthen and reinforce the same so as to give the live load desired,
provided, (i) Tenant shall submit to Landlord the plans showing the locations of
and the desired floor live load for the areas in question, (ii) Tenant shall
agree to pay for or reimburse Landlord on demand for the cost of such
strengthening and reinforcement as well as any other costs to and expenses of
Landlord occasioned by or resulting from such strengthening or reinforcement,
(iii) Landlord's architects, in their sole reasonable discretion, find that the
work necessary to increase such floor load does not adversely affect the
structure of the Building and (iv) such work will not interfere with the amount
or availability of any space adjoining alongside, above or below the demised
premises, or interfere with the occupancy of other tenants in the Building.
7.3 Landlord shall exercise reasonable diligence in the making
of any repairs, alterations, additions or improvements so as to minimize any
interference with Tenant's business operations, but shall not be required to
perform the same on an overtime or premium pay basis.
7.4 Landlord shall, at its expense (subject to the provisions
of Section 7.1 hereof and to reimbursement as set forth in Article 4 hereof)
keep and maintain the Common Areas and the Building in good condition and repair
in accordance with the standards appropriate to a first class office building in
Westchester County, New York, and make all repairs, structural and otherwise,
interior and exterior, as and when needed in or about the demised premises,
except for those repairs for which Tenant is responsible pursuant to the
provisions of this Lease.
ARTICLE 8
REQUIREMENTS OF LAW
8.1 Tenant, at Tenant's cost and expense, shall comply with
all Legal Requirements (as defined in Section 22.4) which result from Tenant's
manner or use or occupation of the demised
<PAGE> 27
premises. Landlord represents that, as of the date hereof, the demised premises
are in substantial compliance with all Legal Requirements and Tenant's use as
set forth Section 5.1 is permitted under the current Certificate of Occupancy
for the Building.
8.2 Notwithstanding the provisions of Section 8.1 hereof,
Tenant, at its own cost and expense, in its name may contest, in any manner
permitted by law (including appeals to a court, or governmental department or
authority having jurisdiction in the matter), the validity or the enforcement of
any governmental act, regulation or directive with which Tenant is required to
comply pursuant to this Lease, and may defer compliance therewith provided that:
(a) such non-compliance shall not subject Landlord to criminal
or civil prosecution or subject the Land and/or the Building Project to lien or
sale;
(b) such non-compliance shall not be in violation of any fee
mortgage, or of any ground or underlying lease or any mortgage thereon;
(c) Tenant shall first deliver to Landlord a surety bond (in
such sum as Landlord may reasonably request) issued by a surety company of
recognized responsibility, or other security satisfactory to Landlord,
indemnifying and protecting Landlord against any loss or injury by reason of
such non-compliance; and
(d) Tenant shall promptly and diligently prosecute such
contest.
Landlord, without expense or liability to it, shall cooperate
with Tenant and execute any documents or pleadings required for such purpose,
provided that Landlord shall reasonably be satisfied that the facts set forth in
any such documents or pleadings are accurate.
ARTICLE 9
INSURANCE, LOSS, REIMBURSEMENT, LIABILITY
9.1 Tenant shall not knowingly or intentionally violate, or
permit the violation of, any condition imposed by any insurance policy then
issued in respect to the Building Project and/or the property therein and shall
not do, or permit anything to be done, or keep or permit anything to be kept in
the demised premises which would subject Landlord to any liability or
responsibility for bodily injury or death or property damage, or which would
increase any insurance rate in respect to the Building Project or the property
therein over the rate which
<PAGE> 28
would otherwise then be in effect or which would result in insurance companies
of good standing refusing to insure the Building Project or the property therein
in amounts reasonably satisfactory to Landlord, or which would result in the
cancellation of or the assertion of any defense by the insurer in whole or in
part to claims under any policy of insurance in respect of the Building Project
or the property therein, but nothing contained in this Section 9.1 shall be
construed to restrict Tenant's use of the demised premises for the purposes
permitted under Article 5 hereof.
9.2 If, by reason of any failure of Tenant to comply with the
provisions of Section 8.1 or Section 9.1, the premiums on Landlord's insurance
on the Building Project and/or equipment or property therein shall be higher
than they otherwise would be, Tenant shall reimburse Landlord, on demand, for
that part of such premiums attributable to such failure on the part of Tenant. A
schedule or "make up" of rates for the Building Project issued by the applicable
fire insurance rating organization or other similar body making rates for
insurance for the Building Project shall be conclusive evidence of the facts
therein stated and of the several items and charges in the insurance rate then
applicable to the Building Project.
9.3 Tenant, at its expense, shall maintain at all times during
the term of this Lease (a) "all risk" property insurance covering Tenant's
property and improvements and betterments to a limit of not less than 100% of
the replacement cost thereof and (b) comprehensive general liability insurance,
including contractual liability, in respect of the demised premises and the
conduct or operation of business therein, with Landlord and its managing agent,
if any, and any lessor of any ground or underlying lease or the holder of any
mortgage, as the case may be, whose name and address shall have been furnished
to Tenant, as additional insureds, with limits of not less than $3,000,000
combined single limit bodily injury and property damage liability. Landlord
hereby agrees that the comprehensive general liability insurance requirement
described in clause (b) of the preceding sentence may be satisfied through the
use of umbrella coverage, which umbrella coverage must be evidenced by a policy
of insurance satisfactory to Landlord. The limits of such insurance shall not
limit the liability of Tenant hereunder. Tenant shall deliver to Landlord and
any additional insureds such fully paid-for policies and certificates of
insurance in form satisfactory to Landlord issued by the insurance company or
its authorized agent, at least ten (10) days before the Commencement Date.
Tenant shall procure and pay for renewals of such insurance from time to time
before the expiration thereof, and Tenant shall deliver to Landlord and any
additional insureds such renewal policy and certificates of coverage at least
thirty (30) days before the expiration of any existing policy. All such policies
shall be issued by companies reasonably acceptable to
<PAGE> 29
Landlord. If Landlord is included as a named payee on any check issued by
Tenant's insurer in payment of any claim solely with respect to Tenant's
property, Landlord agrees that it will promptly upon Tenant's request endorse
such check to Tenant. Landlord further agrees that it shall have no right or
authority to participate in any settlement of any claim by Tenant against its
insurer which relates solely to damage or loss to Tenant's property.
9.4 Each party agrees to have included in each of its
insurance policies a waiver of the insurer's right of subrogation against the
other party (and in the case of Tenant against other tenants of the Building)
during the term of this Lease or, if such waiver should be unobtainable or
unenforceable, (i) an express agreement that such policy shall not be
invalidated if the insured waives the right of recovery against any party
responsible for a casualty covered by the policy before the casualty, or (ii)
any other form of permission for the release of the other party reasonably
satisfactory to the party intended to be released. If such waiver, agreement or
permission shall not be, or shall cease to be, obtainable from either party's
then current insurance company, the insured party shall so notify the other
party promptly after learning thereof, and shall use commercially reasonable
efforts to obtain the same from another insurance company (if the insured party
is Tenant, an insurance company described in Section 9.3 hereof). Each party
hereby releases the other party (and in the case of Tenant, other tenants of
Building who shall have executed a similar waiver or agreement as set forth in
this Section 9.4) with respect to any claim (including a claim for negligence)
which it might otherwise have against the other party, for loss, damage or
destruction with respect to its property occurring during the term of this Lease
to the extent to which it is required pursuant to the terms hereof, to be
insured under a policy or policies containing a waiver of subrogation, agreement
or permission to release liability, as provided in the preceding subdivisions of
this section. If, notwithstanding the recovery of insurance proceeds by either
party for loss, damage or destruction of its property, the other party is liable
to the first party with respect thereto or is obligated under this Lease to make
replacement, repair or restoration or payment, then, provided the first party's
right of full recovery under its insurance policies is not thereby prejudiced or
otherwise adversely affected, the amount of the net proceeds of the first
party's insurance against such loss, damage or destruction shall be offset
against the second party's liability to the first party therefor, or shall be
made available to the second party to pay for replacement, repair or
restoration, as the case may be. Nothing contained in this section shall be
deemed to relieve either party of any duty imposed elsewhere in this Lease to
repair, restore or rebuild provided for elsewhere in this Lease.
<PAGE> 30
9.5 Landlord may from time to time, but not more frequently
than once every three (3) years, require that the amount of comprehensive
general liability insurance to be maintained by Tenant under Section 9.3 or
Section 6.1(f) be reasonably increased.
9.6 Landlord or its agents shall not be liable for any injury
or damage to persons or property resulting from fire, explosion, falling
plaster, steam, gas, electricity, water, rain or snow or leaks from any part of
the Building Project, or from the pipes, appliances or plumbing works or from
the roof, street or subsurface or from any other place or by dampness or by any
other cause of whatsoever nature, unless any of the foregoing shall be caused by
or due to the negligence of Landlord.
9.7 Landlord or its agents shall not be liable for any damage
which Tenant may sustain if at any time any window of the demised premises is
temporarily closed, darkened or bricked up for any reason whatsoever, or
permanently closed, darkened or bricked up to comply with Legal Requirements or
the requirements of Landlord's insurers, and Tenant shall not be entitled to any
compensation therefor or abatement of rent or to any release from any of
Tenant's obligations under this Lease, nor shall the same constitute an
eviction.
9.8 Each party agrees to give the other party notice in case
of fire or accidents in the demised premises promptly after such party becomes
aware of such event.
ARTICLE 10
LANDLORD'S LIABILITY
10.1 Tenant agrees to look solely to Landlord's estate and
interest in the Building, or the proceeds from the sale thereof for the
satisfaction of any right or remedy of Tenant for the collection of a judgment
(or other judicial process) requiring the payment of money by Landlord, in the
event of any liability by Landlord hereunder, and no other property or assets of
Landlord shall be subject to levy, execution, attachment, 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 demised premises, or any other liability of Landlord to
Tenant hereunder. Neither the partners constituting Landlord (the "PARTNERS"),
nor the partners, shareholders, directors or officers of Landlord or the
Partners shall be liable for the performance of Landlord's obligations under
this Lease.
ARTICLE 11
<PAGE> 31
ASSIGNMENT, MORTGAGING, SUBLETTING, ETC.
11.1 Subject to the provisions of Section 11.2 hereof Tenant
shall not (a) assign or otherwise transfer this Lease or any interest herein, or
the term and estate hereby granted, (b) sublet the demised premises or any part
thereof or allow the same to be used or occupied by others, (c) mortgage, pledge
or encumber this Lease or the demised premises or any part thereof in any manner
by reason of any act or omission on the part of Tenant, or (d) advertise, or
authorize a broker to advertise, for a subtenant or an assignee at a
consideration or at rental rates below the rental rates then being advertised by
Landlord as its rental rates for comparable space in the Building Project and
for a comparable term, without, in each instance, obtaining the prior written
consent of Landlord, except as otherwise expressly provided in this Article 11.
For purposes of this Article 11, (i) the transfer of a majority of the issued
and outstanding capital stock of any corporate tenant, or of a corporate
subtenant, or the transfer of a majority of the total interest in any
partnership, limited liability company or other entity that is the Tenant or a
subtenant, however accomplished, whether in a single transaction or in a series
of related or unrelated transactions, shall be deemed an assignment of this
Lease, or of such sublease, as the case may be, and (ii) a takeover agreement
shall be deemed a transfer of this Lease.
11.2 The consent of Landlord shall not be required for (but
the provisions of Section 11.5(d) hereof shall be applicable to) an assignment
or sublease of all or any portion of the demised premises to (i) a corporation
into or with which Tenant is merged or consolidated, (ii) an entity to which
substantially all of Tenant's shares or assets are transferred or, (iii) if
Tenant is a partnership, a successor partnership, provided that any such merger,
consolidation, transfer or other transaction is not principally for the purpose
of transferring the leasehold estate created hereby, and provided further, that
the assignee, successor or subtenant, as applicable, has a net worth at least
equal to or in excess of the net worth of Tenant immediately prior to the
transaction in question. The provisions of clauses (a) and (b) of Section 11.1
shall not apply to transactions with an entity (hereinafter called an
"AFFILIATE") which controls or is controlled by Tenant or is under common
control with Tenant during the period it remains an Affiliate. Furthermore, an
Affiliate of Tenant shall be permitted to occupy the demised premises but only
during such period as it shall remain an Affiliate. For the purposes of the
foregoing "control" shall mean ownership of 50% or more of the stock,
partnership interests or other equity interests in the entity.
11.3 Any assignment or transfer, whether made with Landlord's
consent as required by Section 11.1 or without
<PAGE> 32
Landlord's consent pursuant to Section 11.2, shall not be effective hereunder
until, the assignee shall execute, acknowledge and deliver to Landlord a
recordable agreement, in form and substance reasonably satisfactory to Landlord,
whereby the assignee shall assume the obligations and performance of this Lease
from and after the date of such assignment and agree to be personally bound by
and upon all of the covenants, agreements, terms, provisions and conditions
hereof on the part of Tenant to be performed or observed and whereby the
assignee shall agree that the provisions of Section 11.1 hereof shall,
notwithstanding any further assignment or transfer, continue to be binding upon
it in the future. Tenant covenants that, notwithstanding any assignment or
transfer, whether or not in violation of the provisions of this Lease, and
notwithstanding the acceptance of fixed annual rent by Landlord from an assignee
or transferee or any other party, Tenant shall remain fully and primarily liable
for the payment of the fixed annual rent and additional rent due and to become
due under this Lease and for the performance of all of the covenants,
agreements, terms, provisions and conditions of this Lease on the part of Tenant
to be performed or observed.
11.4 (a) Except for an assignment or sublease pursuant to
Section 11.2 hereof, if Tenant agrees to enter into an assignment of this Lease
or a sublease to sublet the demised premises or any portion thereof, Tenant
shall, as soon as that agreement is consummated, but no less than sixty (60)
days prior to the effective date of the contemplated assignment or sublease,
deliver to Landlord an executed counterpart of the proposed assignment or
sublease, and Landlord shall then have the right to elect, by notifying Tenant
within thirty (30) days of such delivery, to (i) in the case of an assignment of
this Lease, to terminate this Lease or to accept an assignment of this Lease
from Tenant, and Tenant shall then promptly execute and deliver to Landlord or
entity affiliated with Landlord, in form reasonably satisfactory to Landlord's
counsel, an assignment on the terms reflected in the proposed assignment, which
assignment shall be effective as of such effective date and shall relieve Tenant
of further liability accruing under this Lease after such effective date as to
such portion of the demised premises assigned to Landlord or entity affiliated
with Landlord, and (ii) in the case of a proposed subletting, to terminate this
Lease, with respect to the portion of the demised premises affected by any such
proposed subletting or the entire demised premises in the case of a proposed
subletting thereof or to accept a sublease from Tenant thereof, and Tenant shall
then promptly execute and deliver a sublease to Landlord or entity affiliated
with Landlord, for the duration of Tenant's proposed subletting, commencing with
such effective date, at the rental terms reflected in the proposed sublease. If
an offer of sublease to Landlord results in all or substantially all of the
demised premises being sublet for substantially all of the term of this Lease
(i.e., the balance of the term less one year or less), then
<PAGE> 33
Landlord shall have the option to extend the term of the sublease being offered
to it for the remainder of the term of this Lease less one day.
(b) If Landlord should elect to have Tenant execute and
deliver a sublease pursuant to any of the provisions of this Section 11.4, said
sublease shall be in a form reasonably satisfactory to Landlord's counsel and on
all the terms contained in this Lease, except that:
(i) The rental terms shall be as provided in
subsection 11.4(a) hereof,
(ii) The sublease shall not provide for any work to be done
for the subtenant or for any initial rent concessions or contain
provisions inapplicable to a sublease, except that in the case of a
subletting of a portion of the demised premises, Tenant shall reimburse
subtenant for the cost of erecting such demising walls as are necessary
to separate the subleased premises from the remainder of the demised
premises and to provide access and building services thereto, provided
Tenant was obligated to perform such work or reimburse the proposed
subtenant for such work under the terms of the proposed sublease,
(iii) The subtenant thereunder shall have the right to
underlet the subleased premises, in whole or in part, without Tenant's
consent,
(iv) The subtenant thereunder shall have the right to make,
or cause to be made, any changes, alterations, decorations, additions
and improvements that such subtenant may desire or authorize,
(v) Such sublease shall expressly negate any intention
that any estate created by or under such sublease be merged with any
other estate held by either of the parties thereto,
(vi) Any consent required of Tenant, as lessor under that
sublease, shall be deemed granted if consent with respect thereto is
granted by Landlord,
(vii) The use of the sublet premises by the subtenant shall
be for general, administrative and/or executive offices unless
constructed for another purpose by or for Tenant in which event
Landlord may in addition use it for such purpose,
(viii) Any failure of the subtenant thereunder to comply with
the provisions of said sublease, other than with respect to the payment
of rent to Tenant, shall not
<PAGE> 34
constitute a default thereunder or hereunder if Landlord has consented
to such non-compliance, unless such failure to comply would cause a
violation of law or would increase or extend the liability of Tenant
under this Lease,
(ix) Upon execution of such sublease, Tenant's obligations
with respect to vacating the demised premises and removing any changes,
alterations, decorations, additions or improvements made in the
subleased premises shall be limited to those which accrued and related
to such as were made prior to the effective date of the sublease, and
(x) Such sublease shall provide that at the expiration of
the term of such subletting Tenant will accept the space in the
condition provided for in the proposed sublease.
If Landlord should elect to have Tenant execute and deliver a
sublease pursuant to any of the provisions of this Section 11.4, Tenant shall be
excused from having to obtain Landlord's consent, as required by the terms of
this Lease, for changes, alterations, decorations, additions or improvements
desired by the subtenant.
(c) If pursuant to the exercise of any of Landlord's options
pursuant to this Section 11.4 hereof this Lease is terminated as to only a
portion of the demised premises, then the fixed annual rent payable hereunder
and the additional rent payable pursuant to Articles 3 and 4 hereof shall be
adjusted in proportion to the portion of the demised premises affected by such
termination.
11.5 In the event that Landlord does not exercise the option
available to it pursuant to subsection 11.4(a) hereof, Landlord shall not
unreasonably withhold or delay its consent to an assignment of this Lease or a
proposed subletting of the demised premises, as the case may be, by Tenant,
provided:
(a) Tenant shall have furnished Landlord with the name and
business address of the proposed subtenant or assignee, information with respect
to its intended use of the demised premises and the nature and character of the
proposed subtenant's or assignee's business, or activities, and, if Tenant is no
longer the actual tenant of the demised premises, such reasonable references and
current financial information with respect to net worth, credit and financial
responsibility as are reasonably satisfactory to Landlord, and an executed
counterpart of the sublease or assignment agreement;
(b) the proposed subtenant or assignee is a reputable party
whose financial net worth, credit and financial
<PAGE> 35
responsibility is, considering the responsibilities involved, satisfactory to
Landlord;
(c) the proposed subtenant or assignee is not then an occupant
of any part of the Building Project or a party who is dealing with Landlord or
Landlord's agent (directly or through a broker) with respect to space then
available (or becoming available) in the Building Project; and
(d) each sublease shall specifically state that (i) it is
subject to all of the terms, covenants, agreements, provisions, and conditions
of this Lease, and (ii) the subtenant or assignee, as the case may be, will not
have the right to a further assignment thereof or sublease or assignment
thereunder, or to allow the demised premises to be used by others, without the
prior reasonable consent of Landlord in each instance.
11.6 If Tenant defaults in the payment of any rent, Landlord
is authorized to collect any rents due or accruing from any assignee, subtenant
or other occupant of the demised premises and to apply the net amounts collected
to the fixed annual rent and additional rent reserved herein. The receipt by
Landlord of any amounts from an assignee or subtenant, or other occupant of any
part of the demised premises shall not be deemed or construed as releasing
Tenant from Tenant's obligations hereunder or the acceptance of that party as a
direct tenant.
ARTICLE 12
ELECTRICITY
12.1 (a) Landlord shall supply electricity to the demised
premises in accordance with the provisions of this Section 12.1. For the
purposes of this Section 12.1, Landlord and Tenant agree that the term "COST PER
KILOWATT HOUR" shall mean the total cost for electricity incurred by Landlord to
service the demised premises, as measured by the meter servicing that portion of
the Building in which the demised premises are located, during a particular time
period (including all applicable surcharges, demand charges, energy charges,
fuel adjustment charges, time of day charges, taxes and other sums payable in
respect thereof) divided by the total kilowatt hours purchased by Landlord
during such period.
(b) Electricity shall be supplied by Landlord to service the
demised premises and Tenant shall pay to Landlord, as additional rent, an amount
determined by applying the Cost per Kilowatt hour to Tenant's consumption of and
demand for electricity within the demised premises as recorded on the submeter
or submeters servicing the demised premises. Where more than one meter measures
the electric service to Tenant, the
<PAGE> 36
electric service rendered through each meter shall be computed and billed
separately in accordance with the provisions hereinafter set forth. Bills for
the electricity additional rent shall be rendered to Tenant at such time as
Landlord may elect. If any tax is imposed upon Landlord's receipts from the sale
of electricity to Tenant by Federal, State or municipal authority, Tenant agrees
that, unless prohibited by law, Tenant's proportionate share of such taxes shall
be included in the bill of, and paid by Tenant to, Landlord, as additional rent.
Landlord's failure during the term of this Lease to prepare and deliver any
statements or bills under this Article 12, or Landlord's failure to make a
demand under this Article 12, or any other provisions of this Lease shall not in
any way be deemed to be a waiver of, or cause Landlord to forfeit or surrender
its rights to collect, any amount of additional rent which may have become due
pursuant to this Article 12 during the term of this Lease. The costs incurred by
Landlord for meter readings for those meters and sub-meters that measure the
electric service supplied to Tenant, and the costs incurred by Landlord in the
maintenance of such meters and sub-meters, shall be paid by Tenant on demand, as
additional rent. Tenant's liability for any amounts due under this Article 12
shall survive the expiration or sooner termination of this Lease.
12.2 Notwithstanding the provisions of Section 12.1 above, at
Landlord's option, Tenant shall, within sixty (60) days after receiving notice
from Landlord (or any shorter period as may be required by applicable legal
requirements), contract directly with the public utility furnishing electric
current to the Building for the supply, at Tenant's cost, of all electric
current to be used in the demised premises including, without limitation, such
as is required for the operation of any supplemental heating, ventilating and
air-conditioning system serving the demised premises except that which is used
in the operation of the "HVAC SYSTEM" (as that term is hereinafter defined in
Section 21.1).
12.3 Tenant's use of electric current in the demised premises
shall not at any time exceed the capacity of any of the electrical conductors
and equipment in or otherwise serving the demised premises. Tenant shall not
make or perform, or permit the making or performing of, any alterations to
wiring, installations or other electrical facilities in or serving the demised
premises without the prior consent of the Landlord in each instance. Should
Landlord grant any such consent, all additional risers or other equipment
required therefor shall be installed by Landlord (after advising Tenant of the
estimated cost thereof and provided Tenant elects to have Landlord proceed with
such work) and the cost thereof shall be paid by Tenant upon Landlord's demand,
at which time Landlord shall provide Tenant with documentation in regard to such
costs, which such costs shall not exceed what would be paid in an arm's-length
<PAGE> 37
transaction and any such alterations shall be made in accordance with Article 6
thereof.
12.4 Landlord shall not be liable in any way to Tenant for any
failure or defect in the supply or character of electric energy furnished to the
demised premises by reason of any requirement, act or omission of the public
utility serving the Building with electricity or for any other reason and not
attributable to Landlord's negligence.
12.5 If, at any time during the term of this Lease, Tenant
wishes to install in the demised premises equipment which would not be
considered ordinary office equipment, including, but not limited to, items such
as computer installation or supplemental air conditioning systems, or other heat
or cooling-intensive electrically operated equipment, Tenant shall submit to
Landlord a list indicating the specific type of additional equipment to be
installed. Such list shall include the number, type and model of each item of
equipment to be installed, as well as the manufacturer's electrical rating
associated with same. If, in Landlord's reasonable judgment the operation of
such equipment will impair the proper operation of the plumbing, heating,
ventilation, air conditioning or other systems for the Building, Tenant shall
not be permitted to make such installation, provided that Landlord, in its sole
discretion, may permit Tenant to make such installation if as a condition to the
installation of such equipment, Tenant shall reimburse Landlord for Landlord's
additional cost incurred, as a result of such equipment installation and
operation, in connection with the proper function of such systems.
ARTICLE 13
DAMAGE BY FIRE OR OTHER CAUSE
13.1 If the Building or the demised premises shall be
partially or totally damaged or destroyed by fire or other cause, within
forty-five (45) days after Landlord acquires knowledge of such damage, Landlord
shall deliver to Tenant an estimate prepared by a reputable contractor selected
by Landlord setting forth such contractor's estimate as to the reasonable time
required to repair such damage. If the demised premises are damaged or destroyed
or if they are not but the building is damaged, which damage materially
adversely affects Tenant's access to the demised premises, and the time period
set forth in such estimate exceeds three hundred and sixty (360) days, Tenant
may elect to terminate this Lease by notice to Landlord not later than fifteen
(15) days following the delivery of such estimate to Tenant. If Tenant makes
such election, the Term shall expire upon the twentieth (20th) day after notice
of such election is given by Tenant and Tenant shall vacate the demised premises
and
<PAGE> 38
surrender the same to Landlord. Upon such termination, Tenant's liability for
fixed annual rent and additional rent shall cease as of the day following such
damage and any prepaid portion thereof for any period after such date shall be
refunded by Landlord to Tenant. If (x) the estimate does not exceed three
hundred and sixty (360) days, or (y) Tenant fails to make its election as set
forth hereinabove in this paragraph, and if Landlord does not make the election
under Section 13.3 (if applicable), Landlord shall repair the damage and restore
and rebuild the Building and/or the demised premises, at its expense (without
limiting the rights of Landlord under any other provisions of this Lease);
provided, however, that Landlord shall not be required to repair or replace any
of Tenant's property, improvements, betterments or Alterations.
13.2 If the Building or the demised premises shall be
partially damaged or partially destroyed by fire or other cause, the fixed
annual rent and additional rent payable hereunder shall be abated to the extent
that the demised premises shall have been rendered untenantable for the period
from the date of such damage or destruction to the date the damage shall be
substantially repaired or restored. If the demised premises shall be totally
(which shall be deemed to include substantially totally) damaged or destroyed or
rendered completely (which shall be deemed to include substantially completely)
untenantable on account of fire or other cause, the fixed annual rent and
additional rent shall abate as of the date of the damage or destruction and
until Landlord shall substantially repair, restore and rebuild the Building and
the demised premises. Should Tenant reoccupy a portion of the demised premises
during the period the restoration work is taking place with respect to any
damage or destruction referred to in this Section 13.2 and prior to the date
that the same are made tenantable, rents allocable to such portion shall be
payable by Tenant from the date of such occupancy. Furthermore, if Tenant delays
the performance of the restoration work, such work shall be deemed to be
substantially completed on the date that it would have been completed but for
such delay.
13.3 If the Building or the demised premises shall be totally
(which shall be deemed to include substantially totally) damaged or destroyed by
fire or other cause, or if the Building shall be so damaged or destroyed by fire
or other cause (whether or not the demised premises are damaged or destroyed) as
to require a reasonably estimated expenditure of more than forty percent (40%)
of the full insurable value of the Building immediately prior to the casualty,
then in either such case Landlord may terminate this Lease by giving Tenant
notice to such effect within one hundred twenty (120) days after the date of the
casualty.
13.4 No damages, compensation or claim shall be payable by
Landlord for inconvenience, loss of business or
<PAGE> 39
annoyance arising from any repair or restoration of any portion of the demised
premises or of the Building pursuant to this Article 13.
13.5 Notwithstanding any of the foregoing provisions of this
Article 13, if Landlord or the lessor of any superior lease or the holder of any
superior mortgage shall be unable to collect all of the insurance proceeds
(including rent insurance proceeds) applicable to damage or destruction of the
demised premises or the Building by fire or other cause, by reason of some
action or inaction on the part of Tenant or any of its employees, agents or
contractors, then, without prejudice to any other remedies which may be
available against Tenant, there shall be no abatement of Tenant's rents, but the
total amount of such rents not abated (which would otherwise have been abated)
shall not exceed the amount of uncollected insurance proceeds.
13.6 Landlord will not carry separate insurance of any kind on
Tenant's property, improvements, betterments or Alterations and, shall not be
obligated to repair any damage thereto or replace the same. Tenant shall
maintain insurance on Tenant's property, improvements, betterments or
Alterations and Tenant shall be obligated to repair any damage thereto and
replace the same.
13.7 The provisions of this Article 13 shall be considered an
express agreement governing any cause of damage or destruction of the demised
premises by fire or other casualty, and no statute, rule, law or regulation of
the State of New York or any of its political subdivisions now or hereafter in
force and providing for such a contingency in the absence of an express
agreement (including without limitation Section 227 of the Real Property Law),
shall have application in such case.
ARTICLE 14
CONDEMNATION
14.1 In the event that the whole of the demised premises shall
be lawfully condemned or taken in any manner for any public or quasi-public use,
this Lease and the term and estate hereby granted shall forthwith cease and
terminate as of the date of vesting of title. In the event that only a part of
the demised premises shall be so condemned or taken, then, effective as of the
date of vesting of title, the fixed annual rent under Article l hereunder and
additional rents under Articles 3 and 4 hereunder shall be abated in an amount
thereof apportioned according to the area of the demised premises so condemned
or taken. In the event that only a part of the Building Project (as such term is
defined in subsection 3.2(i) hereof) shall be so condemned or taken, then (a)
Landlord
<PAGE> 40
(whether or not the demised premises be affected) may, at Landlord's option,
terminate this Lease and the term and estate hereby granted as of the date of
such vesting of title by notifying Tenant in writing of such termination within
sixty (60) days following the date on which Landlord shall have received notice
of vesting of title, or (b) if such condemnation or taking shall be of fifteen
percent (15%) or more of the demised premises or of a substantial part of the
means of access thereto, Tenant may, at Tenant's option, by delivery of notice
in writing to Landlord within thirty (30) days following the date on which
Tenant shall have received notice of vesting of title, terminate this Lease and
the term and estate hereby granted as of the date occurring six months after the
vesting of title, or (c) if neither Landlord nor Tenant elects to terminate this
Lease, as aforesaid, this Lease shall be and remain unaffected by such
condemnation or taking, except that the fixed annual rent payable under Article
1 and additional rents payable under Articles 3 and 4 shall be abated to the
extent hereinbefore provided. In the event that only a part of the demised
premises shall be so condemned or taken and this Lease and the term and estate
hereby granted with respect to the remaining portion of the demised premises are
not terminated as hereinbefore provided, Landlord will, with reasonable
diligence and at its expense, restore the remaining portion of the demised
premises as nearly as practicable to the same condition as it was in prior to
such condemnation or taking. Tenant shall be obligated to repair and replace its
property, improvements, betterments and Alterations.
14.2 In the event of its termination in any of the cases
hereinbefore provided, this Lease and the term and estate hereby granted shall
expire as of the date of such termination with the same effect as if that were
the Expiration Date, and the fixed annual rent and additional rents payable
hereunder shall be apportioned as of such date.
14.3 In the event of any condemnation or taking hereinbefore
mentioned of all or a part of the Building Project, Landlord shall be entitled
to receive the entire award in the condemnation proceeding, including any award
made for the value of the estate vested by this Lease in Tenant, and Tenant
hereby expressly assigns to Landlord any and all right, title and interest of
Tenant now or hereafter arising in or to any such award or any part thereof, and
Tenant shall be entitled to receive no part of such award. Provided that
Landlord's award is not reduced by reason thereof, Tenant may apply for an award
for its moving expenses and trade fixtures.
14.4 It is expressly understood and agreed that the provisions
of this Article 14 shall not be applicable to any condemnation or taking for
governmental occupancy for a limited period.
<PAGE> 41
ARTICLE 15
ACCESS TO DEMISED PREMISES; CHANGES
15.1 Tenant shall permit Landlord to erect, use and maintain
pipes, ducts and conduits in and through the demised premises, provided the same
are installed adjacent to or concealed behind walls and ceilings of the demised
premises. Landlord shall to the extent practicable install such pipes, ducts and
conduits by such methods and at such locations as will not materially interfere
with or impair Tenant's layout or use of the demised premises. Landlord or its
agents or designees, on reasonable notice to Tenant (except in the case of
emergency), shall have the right to enter the demised premises, at reasonable
times during business hours (except in the case of emergency), for the making of
such repairs or alterations as Landlord may reasonably deem necessary for the
Building or which Landlord shall be required to or shall have the right to make
by the provisions of this Lease or any other lease in the Building and, subject
to the foregoing, shall also have the right to enter the demised premises for
the purpose of inspecting them or exhibiting them to prospective purchasers or
lessees of the entire Building or to prospective mortgagees of the fee or of the
Landlord's interest in the property of which the demised premises are a part or
to prospective assignees of any such mortgages or to the holder of any mortgage
on the Landlord's interest in the property, its agents or designees. Landlord
shall exercise reasonable diligence so as to minimize the disturbance, but
nothing contained herein shall be deemed to require Landlord to perform the same
on an overtime or premium pay basis.
15.2 Landlord reserves the right, without the same
constituting an eviction and without incurring liability to Tenant therefor, to
change the arrangement and/or location of public entrances, passageways, doors,
doorways, corridors, possible elevators, stairways, toilets and other public
parts of the Building; provided, however, that access to the Building shall not
be cut off and there shall be no unreasonable obstruction of access to the
demised premises or unreasonable interference with the use or enjoyment thereof.
15.3 In connection with any work performed by Landlord in
accordance with the provisions of this Article 15, upon the completion of such
work, Landlord will restore as closely as reasonably possible any improvements
located on the demised premises to the condition of such improvements prior to
the commencement of such work by Landlord; provided, however, nothing contained
in this paragraph is meant to (i) limit in any way Landlord's rights to perform
any work or repairs permitted to be performed by this Article 15 or (ii) require
the use of labor on an overtime or premium pay basis to perform such restoration
work on the improvements located on the demised premises.
<PAGE> 42
15.4 Landlord may, during the six (6) months prior to
expiration of the term of this Lease, exhibit the demised premises to
prospective tenants during normal business hours upon reasonable advance notice
to Tenant.
15.5 If Tenant shall not be personally present to open and
permit an entry into the demised premises at any time when for any reason an
entry therein shall be urgently necessary by reason of fire or other emergency,
Landlord or Landlord's agents may forcibly enter the same without rendering
Landlord or such agents liable therefor (if during such entry Landlord or
Landlord's agents shall accord reasonable care to Tenant's property and shall be
liable for any loss, damage or theft) and without in any manner affecting the
obligations and covenants of this Lease.
ARTICLE 16
DEFAULT
16.1 This Lease and the term and estate hereby granted are
subject to the limitation that whenever Tenant shall make an assignment of the
property of Tenant for the benefit of creditors, or shall file a voluntary
petition under any bankruptcy or insolvency law or any involuntary petition
alleging an act of bankruptcy or insolvency shall be filed against Tenant under
any bankruptcy or insolvency law, or whenever a petition shall be filed by or
against Tenant under the reorganization provisions of the United States
Bankruptcy Act or under the provisions of any law of like import, or whenever a
petition shall be filed by Tenant under the provisions of any law of like
import, or whenever a permanent receiver of Tenant or of or for the property of
Tenant shall be appointed, then, Landlord may, (a) at any time after receipt of
notice of the occurrence of any such event, and (b) if such event occurs without
the acquiescence of Tenant, at any time after the event continues for sixty (60)
days, give Tenant a notice of intention to end the term of this Lease at the
expiration of five (5) days from the date of service of such notice of
intention, and upon the expiration of said five (5) day period, this Lease and
the term and estate hereby granted, whether or not the term shall theretofore
have commenced, shall terminate with the same effect as if that day were the
Expiration Date, but Tenant shall remain liable for damages as provided in
Article 18.
16.2 This Lease and the term and estate hereby granted are
subject to further limitation as follows:
(a) whenever Tenant shall default in the payment of any
installment of fixed annual rent, or in the payment of any
<PAGE> 43
additional rent or any other charge payable by Tenant to Landlord, in either
case for ten (10) days after written notice is given to Tenant that such payment
shall have become due; or
(b) whenever Tenant shall do or permit anything to be done,
whether by action or inaction, contrary to or in violation of any of Tenant's
obligations, or, the terms, conditions or provisions hereunder, other than
Tenant's obligations to pay fixed annual rent or additional rent or other
charges under this Lease, and if such situation shall continue and shall not be
remedied by Tenant within twenty (20) days after Landlord shall have given to
Tenant a notice specifying the same, or, in the case of a happening or default
which cannot with due diligence be cured within a period of twenty (20) days and
the continuation of which for the period required for cure will not subject
Landlord to the risk of criminal or civil liability (as more particularly
described in Article 8 hereof) or termination of any superior lease or
foreclosure of any superior mortgage, if Tenant shall not, (i) within said
twenty (20) day period advise Landlord of Tenant's intention to duly institute
all steps necessary to remedy such situation, (ii) duly institute within said
twenty (20) day period, and thereafter diligently and continuously prosecute to
completion all steps necessary to remedy the same and (iii) complete such remedy
within such time after the date of the giving of said notice of Landlord as
shall reasonably be necessary; or
(c) whenever any event shall occur or any contingency shall
arise whereby this Lease or the estate hereby granted or the unexpired balance
of the term hereof would, by operation of law or otherwise, devolve upon or pass
to any person, firm, corporation or other entity other than Tenant, except as
expressly permitted by Article 11; or
(d) whenever Tenant shall abandon the demised premises (unless
as a result of a casualty) and such abandonment shall continue for twenty (20)
days after Landlord shall have given Tenant notice thereof;
(e) whenever Tenant shall default in the due keeping,
observing or performance of any covenant, agreement, provision or condition of
Article 5 hereof on the part of Tenant to be kept, observed or performed and if
such default shall continue and shall not be remedied by Tenant within three (3)
Business Days after Tenant receives a notice specifying the same; or
(f) whenever Tenant shall default with respect to any other
lease between Landlord and Tenant;
then in any of said cases set forth in the foregoing subsections (a), (b), (c),
(d), (e) and (f), Landlord may give to Tenant a notice of intention to end the
term of this Lease at the
<PAGE> 44
expiration of three (3) days from the date of the service of such notice of
intention, and upon the expiration of said three (3) days this Lease and the
term and estate hereby granted, whether or not the term shall theretofore have
commenced, shall terminate with the same effect as if that day were the
Expiration Date, but Tenant shall remain liable for damages as provided in
Article 18.
ARTICLE 17
RE-ENTRY BY LANDLORD, INJUNCTION
17.1 If Tenant shall default in the payment of any installment
of fixed annual rent, or of any additional rent or other charges under this
Lease, on any date upon which the same ought to be paid, and if such default
shall continue for ten (10) days after Landlord shall have given to Tenant a
notice specifying such default, or if any of the events described in Article 16
shall occur, Landlord or Landlord's agents and employees may immediately or at
any time thereafter re-enter the demised premises, or any part thereof, either
by summary dispossess proceedings or by any suitable action or proceeding at
law, without being liable to indictment, prosecution or damages therefrom, to
the end that Landlord may have, hold and enjoy the demised premises again as and
of its first estate and interest therein. The word re-enter, as herein used, is
not restricted to its technical legal meaning. In the event of any termination
of this Lease under the provisions of Article 16 or if Landlord shall re-enter
the demised premises under the provisions of this Article 17 or in the event of
the termination of this Lease, or of re-entry, by or under any summary
dispossess or other proceedings or action by reason of default hereunder on the
part of Tenant, Tenant shall thereupon pay to Landlord the fixed annual rent and
additional rent payable by Tenant to Landlord up to the time of such termination
of this Lease, or of such recovery of possession of the demised premises by
Landlord, as the case may be, and shall also pay to Landlord damages as provided
in Article 18.
17.2 In the event of a breach or threatened breach by Tenant
of any of its obligations under this Lease, Landlord shall also have the right
of injunction. The special remedies to which Landlord may resort hereunder are
cumulative and are not intended to be exclusive of any other remedies or means
of redress to which Landlord may lawfully be entitled at any time and Landlord
may invoke any remedy allowed at law or in equity as if specific remedies were
not provided for herein.
17.3 If this Lease shall terminate under the provisions of
Article 16, or if Landlord shall re-enter the demised premises under the
provisions of this Article 17, or in the event of the termination of this Lease,
or of re-entry by or
<PAGE> 45
under any summary dispossess or other proceeding or action by reason of default
hereunder on the part of Tenant, Landlord shall be entitled to retain all
moneys, if any, paid by Tenant to Landlord, whether as advance rent, security or
otherwise, but such moneys shall be credited by Landlord against any fixed
annual rent or additional rent due from Tenant at the time of such termination
or re-entry or, at Landlord's option against any damages payable by Tenant under
this Article 17 or Article 18 or pursuant to law.
17.4 Tenant hereby expressly waives any and all rights of
redemption granted by or under any present or future laws in the event of Tenant
being evicted or dispossessed for any cause, or in the event of Landlord
obtaining possession of the demised premises, by reason of the violation by
Tenant of any of the covenants and conditions of this Lease or otherwise.
ARTICLE 18
DAMAGES
18.1 If this Lease is terminated under the provisions of
Article 16, or if Landlord shall re-enter the demised premises under the
provisions of Article 17, or in the event of the termination of this Lease, or
of re-entry, by or under any summary dispossess or other proceeding or action by
reason of default hereunder on the part of Tenant, Tenant shall pay to landlord
as damages, at the election of Landlord, either
(a) a sum which at the time of such termination of this Lease
or at the time of any such re-entry by Landlord, as the case may be, represents
the present value (which present value shall be calculated at a discount rate
equal to the then legal rate of interest on judgments in New York State) of the
excess, if any, of
(i) the aggregate of the fixed annual rent and the additional
rent payable hereunder which would have been payable by Tenant
(conclusively presuming the additional rent to be the same as was
payable for the year immediately preceding such termination except that
additional rent on account of increases in Taxes and Expenses shall be
presumed to increase at the average of the rates of increase thereof
previously experienced by Landlord during the period (not to exceed
three (3) years) prior to such termination) for the period commencing
with such earlier termination of this Lease or the date of any such
re-entry, as the case may be, and ending with the Expiration Date, had
this Lease not so terminated or had Landlord not so re-entered the
demised premises, over
<PAGE> 46
(ii) the aggregate rental value of the demised premises for
the same period, or
(b) sums equal to the fixed annual rent and the additional
rent (as above presumed) payable hereunder which would have been payable by
Tenant had this Lease not so terminated, or had Landlord not so re-entered the
demised premises, payable upon the due dates therefor specified herein following
such termination or re-entry and until the Expiration Date; provided, however,
that if Landlord shall re-let the demised premises during said period, Landlord
shall credit Tenant with the net rents received by Landlord from such
re-letting, such net rents to be determined by first deducting from the gross
rents as and when received by Landlord from such re-letting, the expenses
incurred or paid by Landlord in terminating this Lease or in re-entering the
demised premises and in securing possession thereof, as well as the expenses of
re-letting, including altering and preparing the demised premises for new
tenants, brokers' commissions and all other expenses properly chargeable against
the demised premises and the rental thereof; it being understood that any such
re-letting may be for a period shorter or longer than the remaining term of this
Lease; but in no event shall Tenant be entitled to receive any excess of such
net rents over the sums payable by Tenant to Landlord hereunder, nor shall
Tenant be entitled in any suit for the collection of damages pursuant to this
subsection to a credit in respect of any net rents from a re-letting, except to
the extent that such net rents are actually received by Landlord. If the demised
premises or any part thereof should be re-let in combination with other space,
then proper apportionment on a square foot basis shall be made of the rent
received from such re-letting and of the expenses of re-letting.
If the demised premises or any part thereof be re-let by Landlord for the
unexpired portion of the term of this Lease, or any part thereof, before
presentation of proof of such damages to any court, commission or tribunal, the
amount of rent reserved upon such re-letting shall, prima facie, be the fair and
reasonable rental value for the demised premises, or part thereof, so re-let
during the term of the re-letting.
18.2 Suit or suits for the recovery of such damages, or any
installments thereof, may be brought by Landlord from time to time at its
election, and nothing contained herein shall be deemed to require Landlord to
postpone suit until the date when the term of this Lease would have expired if
it had not been so terminated under the provisions of Article 16, or under any
provision of law, or had Landlord not re-entered the demised premises. Nothing
herein contained shall be construed to limit or preclude recovery by Landlord
against Tenant of any sums or damages to which, in addition to the damages
particularly provided above, Landlord may lawfully be entitled by reason of
<PAGE> 47
any default hereunder on the part of Tenant. Nothing herein contained shall be
construed to limit or prejudice the right of Landlord to prove for and obtain as
liquidated damages by reason of the termination of this Lease or re-entry of the
demised premises for the default of Tenant under this Lease, an amount equal to
the maximum allowed by any statute or rule of law in effect at the time when,
and governing the proceedings in which, such damages are to be proved whether or
not such amount be greater, equal to, or less than any of the sums referred to
in Section 18.1.
ARTICLE 19
LANDLORD'S RIGHT TO PERFORM TENANT'S OBLIGATIONS
19.1 If Tenant shall default in the observance or performance
of any term or covenant on Tenant's part to be observed or performed under or by
virtue of any of the terms or provisions of this Lease, (a) Landlord may remedy
such default for the account of Tenant, immediately and without notice in case
of emergency, or in any other case only provided that Tenant shall fail to
remedy such default after Landlord shall have notified Tenant in writing of such
default and the applicable grace period for curing such default shall have
expired; and (b) if Landlord makes any expenditures or incurs any obligations
for the payment of money in connection with such default including, but not
limited to, reasonable attorneys' fees and expenses, such sums paid or
obligations incurred, with interest at the Interest Rate, shall be deemed to be
additional rent hereunder and shall be paid by Tenant to Landlord within thirty
(30) days after rendition of a bill to Tenant therefor.
ARTICLE 20
QUIET ENJOYMENT
20.1 Landlord covenants and agrees that subject to the terms
and provisions of this Lease, if, and so long as, Tenant keeps and performs in
all material respects each and every covenant, agreement, term, provision and
condition herein contained on the part or on behalf of Tenant to be kept or
performed, then Tenant's rights under this Lease shall not be cut off or ended
before the expiration of the term of this Lease, subject however to ground and
underlying leases and mortgages by anyone claiming by or through Landlord which
affect this Lease (as provided in Article 25 hereof).
ARTICLE 21
SERVICES AND EQUIPMENT
<PAGE> 48
21.1 Landlord shall, at its cost and expense (but subject to
reimbursement by Tenant pursuant to Article 4 hereof):
(a) provide necessary passenger elevator facilities during
Business Hours (as such term is defined in Article 22 hereof) and shall have at
least one passenger elevator subject to call at all other times. At Landlord's
option, the elevators shall be operated by automatic control or by manual
control, or by a combination of both of such methods. Landlord shall provide
freight elevator service to Tenant upon reasonable notice from Tenant;
(b) maintain, keep in repair and provide the services of the
Building system air-conditioning, heating and ventilating system ("HVAC SYSTEM")
installed by Landlord in accordance with the design criteria annexed hereto as
EXHIBIT E. The aforesaid systems will function when seasonably required during
Business Hours. The cooling season for the purposes of this Lease shall be May
15 through September 15 of each calendar year. Landlord shall have no
responsibility or liability for the ventilating conditions and/or temperature of
the demised premises during the hours or days Landlord is not required to
furnish heat, ventilation or air-conditioning pursuant to this subsection. In
any event, Tenant shall keep entirely unobstructed all the vents, intakes,
outlets and grilles, at all times and shall comply with and observe all
regulations and requirements prescribed by Landlord for the proper functioning
of the heating, ventilating and air-conditioning systems including without
limitation, the lowering and closing of Venetian blinds in the demised premises
during daylight hours. In the event that Tenant shall require air-conditioning,
heating or ventilation at such times as same are not furnished by Landlord,
Tenant shall give Landlord at least 24-hours advance notice of such requirement,
and Tenant agrees to pay the Landlord's prevailing rate therefor as additional
rent.
(c) provide cleaning and janitorial services on Business Days
in accordance with the specifications annexed hereto as EXHIBIT F; provided,
however, Tenant shall pay to Landlord upon ten (10) days notice the costs
incurred by Landlord for (a) extra cleaning work in the demised premises
required because of (i) misuse or neglect on the part of Tenant or its employees
or visitors, (ii) use of portions of the demised premises for preparation,
serving or consumption of food or beverages, data processing or reproducing
operations, private lavatories or toilets or other special purposes requiring
greater or more difficult cleaning work than office areas, (iii) unusual
quantity of interior glass surfaces, (iv) non-building standard materials or
finishes installed by Tenant or at its request, and (b) removal from the demised
premises and the Building of so much
<PAGE> 49
of any refuse and rubbish of Tenant as shall exceed that ordinarily accumulated
daily in the routine of business office occupancy. Landlord, its cleaning
contractor and their employees shall have access outside of Business Hours to
the demised premises and the use (at Tenant's expense) of light, power and water
in the demised premises as reasonably required for the purpose of cleaning the
demised premises in accordance with Landlord's obligations hereunder; and
(d) furnish hot and cold water for lavatory and office
cleaning purposes and cold water for drinking purposes. If Tenant requires, uses
or consumes water for any other purposes, Tenant agrees to Landlord installing a
meter or meters or other means to measure Tenant's water consumption, and Tenant
further agrees to reimburse Landlord for the cost of the meter or meters and the
installation thereof, and to pay for the maintenance of said meter equipment
and/or to pay Landlord's cost of other means of measuring such water consumption
by Tenant. Tenant shall reimburse Landlord for the cost of all water consumed,
as measured by said meter or meters or as otherwise measured, including, without
limitation, sewer rents.
21.2 Landlord reserves the right to stop the heating,
air-conditioning, elevator, plumbing, electric and other systems when necessary
by reason of accident or emergency or for repairs, alterations, replacements or
improvements, provided that except in case of emergency, Landlord will notify
Tenant in advance of any such stoppage and its estimated duration, and will
proceed diligently with the work necessary to resume such service as promptly as
possible and in a manner so as to minimize interference with the Tenant's use
and enjoyment of the demised premises but nothing herein shall be deemed to
require Landlord to perform the same on an overtime or premium pay basis unless
requested to do so by, and at the expense of, Tenant.
21.3 It is expressly agreed that only Landlord or any one or
more persons, firms or corporations authorized in writing by Landlord will be
permitted to furnish laundry, linen towels, drinking water, ice, food or
beverages and other similar supplies and services to tenants and licensees in
the Building provided the quality thereof and the charges therefor are
reasonably comparable to that of other suppliers of such services. Landlord may
fix, in its own absolute discretion, at any time and from time to time, the
hours during which and the regulations under which such supplies and services
are to be furnished. Landlord expressly reserves the right to act as or to
designate, at any time and from time to time, an exclusive supplier of all or
any one or more of the said supplies and services, provided that the quality
thereof and the charges therefor are reasonably comparable to that of other
suppliers; and Landlord furthermore expressly reserves the right to exclude from
the Building any person, firm or corporation attempting to furnish any of said
<PAGE> 50
supplies or services but not so designated by Landlord. It is understood,
however, that Tenant or regular office employees of Tenant who are not employed
by any supplier of such food or beverages or by any person, firm or corporation
engaged in the business of purveying such food or beverages, may personally
bring food or beverages into the Building for consumption within the demised
premises by employees of Tenant, but not for resale to or for consumption by any
other tenant. Landlord may fix in its absolute discretion, at any time and from
time to time, the hours during which, and the regulations under which, foods and
beverages may be brought into the Building by regular employees of Tenant.
21.4 Tenant agrees to employ such third-party office
maintenance contractor as Landlord may from time to time reasonably designate,
for all waxing, polishing, lamp replacement, cleaning (other than those cleaning
services Landlord is obligated to furnish) and the maintenance work in the
demised premises, provided that the quality thereof and the charges therefor are
reasonably comparable to that of other contractors. Tenant shall not employ any
other contractor without Landlord's prior written consent, which consent shall
not be unreasonably withheld or delayed.
21.5 Landlord will maintain a listing on the Building
directory for Tenant. Landlord will provide a plaque in the mail room for any
additional names Tenant wishes. Tenant may place a sign, approved by Landlord,
on the entrance doors to the demised premises with Tenant's name. Other than
Tenant's name, Tenant shall place no other names, plaques, signs or the like on
the entrance doors to the demised premises and shall place no names, plaques,
signs or the like elsewhere on the exterior of the demised premises. The listing
of any name other than that of the Tenant, whether on the doors of the demised
premises, on the Building directory, or otherwise, shall not operate to vest any
right or interest in this Lease or in the demised premises or to be deemed to be
the written consent of Landlord mentioned in Article 11 hereof, it being
expressly understood that any such listing is a privilege extended by Landlord
revocable at will by written notice to Tenant.
21.6 Landlord will not be required to furnish any other
services, except as otherwise provided in this Lease.
ARTICLE 22
DEFINITIONS
22.1 The term "LANDLORD" as used in this Lease means only the
owner, or the mortgagee in possession, for the time being of the Land and the
Building or the Building Project (or
<PAGE> 51
the owner of a lease of the Building Project or the Building or of the Land and
Building), so that in the event of any transfer of title to the Building Project
or said Land and the Building or said lease, or in the event of a lease of the
Building Project or the Building, or of the Land and the Building, the said
transferor Landlord shall be and hereby is entirely freed and relieved of all
future covenants, obligations and liabilities of Landlord hereunder, and it
shall be deemed and construed as a covenant running with the land without
further agreement between the parties or their successors in interest, or
between the parties and the transferee of title to the Building Project or said
Land and the Building or said lease, or the said lessee of the Building Project
or the Building, or of the Land and the Building, that the transferee or the
lessee has assumed and agreed to carry out any and all such covenants,
obligations and liabilities of Landlord hereunder arising after such transfer.
22.2 The term "BUSINESS DAYS" as used in this Lease shall
exclude Saturdays, Sundays and the following holidays: New Year's Day, Good
Friday, Memorial Day, Independence Day, Labor Day, President's Day, Thanksgiving
Day and the immediately following day, Christmas Day, and all other days
recognized as holidays under applicable union contracts.
22.3 "INTEREST RATE" shall mean a rate per annum equal to the
lesser of (a) two percent (2%) above the commercial lending rate announced from
time to time by The Chase Manhattan Bank (or any successor), as its prime rate
for 90-day unsecured loans, or (b) the maximum applicable legal rate, if any.
22.4 "LEGAL REQUIREMENTS" shall mean laws, statutes and
ordinances (including building codes and zoning regulations and ordinances) and
the orders, rules, regulations, directives and requirements of all federal,
state, county, city and borough departments, bureaus, boards, agencies, offices,
commissions and other subdivisions thereof, or of any official thereof, or of
any other governmental public or quasi-public authority, whether now or
hereafter in force, which may be applicable to the Building Project, the Land or
the Building or the demised premises or any part thereof, or the sidewalks,
curbs or areas adjacent thereto (including, without limitation, the Common
Areas) and all requirements, obligations and conditions of all instruments of
record on the date of this Lease.
22.5 "BUSINESS HOURS" shall mean 8:00 A.M. to 6:00 P.M. on
Business Days.
ARTICLE 23
INVALIDITY OF ANY PROVISION
<PAGE> 52
23.1 If any term, covenant, condition or provision of this
Lease or the application thereof to any circumstance or to any person, firm or
corporation shall be invalid or unenforceable to any extent, the remaining
terms, covenants, conditions and provisions of this Lease or the application
thereof to any circumstances or to any person, firm or corporation other than
those as to which any term, covenant, condition or provision is held invalid or
unenforceable, shall not be affected thereby, and each remaining term, covenant,
condition and provision of this Lease shall be valid and shall be enforceable to
the fullest extent permitted by law.
ARTICLE 24
BROKERAGE
24.1 Landlord and Tenant each covenant, represent and warrant
that it has had no dealings or communications with any broker or agent in
connection with this Lease other than Benson Commercial Realty, Inc. ("BROKER"),
and each covenants and agrees to pay, hold harmless and indemnify the other from
and against any and all cost, expense (including reasonable attorneys' fees and
expenses) or liability for any compensation, commissions or charges claimed by
any other broker or agent with whom the indemnifying party dealt with respect to
this Lease or the negotiation thereof. Landlord will pay any commission earned
by Broker, pursuant to the terms of a separate agreement.
ARTICLE 25
SUBORDINATION
25.1 This Lease is and shall be subject and subordinate to all
ground or underlying leases which may now or hereafter affect the real property
of which the demised premises form a part and to all mortgages which may now or
hereafter affect such leases or such real property, and to all renewals,
modifications, replacements and extensions thereof. The provisions of this
Section 25.1 shall be self-operative and no further instrument of subordination
shall be required. In confirmation of such subordination, Tenant shall promptly
execute and deliver at its own cost and expense any instrument, in recordable
form if required, that Landlord, the lessor of the ground or underlying lease or
the holder of any such mortgage or any of their respective successors in
interest may request to evidence such subordination.
25.2 In the event of a termination of any ground or underlying
lease, or if the interests of Landlord under this
<PAGE> 53
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 under this Lease will, at
the option to be exercised in writing by the lessor under such ground or
underlying lease or such mortgagee or purchaser, assignee or lessee, as the case
may be, either (i) attorn to it and will perform for its benefit all the terms,
covenants and conditions of this Lease on Tenant's part to be performed with the
same force and effect as if said lessor, such mortgagee or purchaser, assignee
or lessee, were the landlord originally named in this Lease, or (ii) enter into
a new lease with said lessor or such mortgagee or purchaser, assignee or lessee,
as landlord, for the remaining term of this Lease and otherwise on the same
terms and conditions and with the same options, if any, then remaining. The
foregoing provisions of clause (i) of this Section 25.2 shall enure to the
benefit of such lessor, mortgagee, purchaser, assignee or lessee, shall be
self-operative upon the exercise of such option, and no further instrument shall
be required to give effect to said provisions. Tenant, however, upon demand of
any such lessor, mortgagee, purchaser, assignee or lessee agrees to execute,
from time to time, instruments in confirmation of the foregoing provisions of
this Section 25.2, satisfactory to any such lessor, mortgagee, purchaser,
assignee or lessee, acknowledging such subordination and attornment and setting
forth the terms and conditions of its tenancy. Tenant hereby constitutes and
appoints Landlord or its successors in interest to be the Tenant's
attorney-in-fact, irrevocably and coupled with an interest, to execute and
deliver such instrument of attornment, or such new lease, if Tenant refuses or
fails to do so promptly upon request.
25.3 Anything herein contained to the contrary
notwithstanding, under no circumstances shall the aforedescribed lessor under
the ground lease or mortgagee or purchaser, assignee or lessee, as the case may
be, whether or not it shall have succeeded to the interests of the landlord
under this Lease, be
(a) liable for any act, omission or default of any prior
landlord so long as such ground lessor or mortgagee shall not be a "related
party" (as that term is defined by the Internal Revenue Code of such prior
landlord); or
(b) subject to any offsets, claims or defenses which the
Tenant might have against any prior landlord; or
(c) bound by any rent or additional rent which Tenant might
have paid to any prior landlord for more than one (1) month in advance or for
more than three (3) months in advance where such rent payments are payable at
intervals of more than one (1) month; or
<PAGE> 54
(d) bound by any modification, amendment or abridgment of the
Lease, or any cancellation or surrender of the same, made without its prior
written approval.
25.4 If, in connection with the financing of the Building, the
holder of any mortgage shall request reasonable modifications in this Lease as a
condition of approval thereof, Tenant will not unreasonably withhold, delay or
defer making such modifications provided such modifications do not increase
Tenant's monetary obligations, change the Term, change the demised premises or
materially increase any other of Tenant's obligations or materially decrease
Tenant's rights under this Lease.
ARTICLE 26
CERTIFICATES OF LANDLORD AND TENANT
26.1 Tenant shall, without charge, at any time and from time
to time, within ten (10) days after request by Landlord, deliver a written
instrument to Landlord or any other person, firm or corporation specified by
Landlord, duly executed and acknowledged, certifying:
(a) that this Lease is unmodified and in full force and effect
or, if there has been any modification, that the same is in full force and
effect as modified and stating any such modification, whether there is any
existing basis to cancel or terminate this Lease, and whether to the best of
Tenant's knowledge Landlord is in default thereunder;
(b) that the term of this Lease has commenced and rent has
become payable thereunder, and that Tenant is in possession of all of the
demised premises;
(c) the amount of the fixed annual rent payable under this
Lease and the dates to which the fixed annual rent and additional rent and other
charges hereunder, have been paid; and
(d) whether or not Tenant has made any claim against Landlord
under this Lease and if so the nature thereof and the dollar amount, if any, of
such claim.
26.2 Landlord agrees, at any time and from time to time, as
requested by Tenant, upon not less than ten (10) days prior notice, to execute
and deliver a statement certifying that this Lease is unmodified and in full
force and effect (or if there have been modifications that the same is in full
force as modified and stating the modifications), certifying the dates to which
the fixed rent and additional rent have been paid, and stating whether or not,
to the best knowledge of the signer,
<PAGE> 55
Tenant is an default in performance of any of his obligations under this Lease,
and, if so, specifying each such default of which the signer may have knowledge.
26.3 Tenant agrees that, except for the first month's rent
hereunder, it will pay no rent under this Lease more than thirty (30) days in
advance of its due date, if so restricted by any existing or future ground lease
or mortgage to which this Lease is subordinated or by an assignment of this
Lease to the ground lessor or the holder of such mortgage, and, in the event of
any act or omission by Landlord, Tenant will not exercise any right to remedy
the default until Tenant shall have given written notice of such act or omission
to the ground lessor and to the holder of any mortgage on the fee or the ground
lease who shall have furnished such lessor's or holder's last address to Tenant,
and until a reasonable period for remedying such act or omission shall have
elapsed following the giving of such notices, during which time such lessor or
holder shall have the right, but shall not be obligated, to remedy or cause to
be remedied such act or omission.
ARTICLE 27
LEGAL PROCEEDINGS WAIVER OF JURY TRIAL
27.1 Landlord and Tenant do hereby waive trial by jury in any
action, proceeding or counterclaim brought by either of the parties hereto
against the other on any matters 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 demised premises, and/or any other claims (except claims for
personal injury or property damage) and any emergency statutory or any other
statutory remedy. It is further mutually agreed that in the event Landlord
commences any summary action or proceeding for non-payment of rent, Tenant will
not interpose and does hereby waive the right to interpose any counterclaim of
whatever nature or description in any such proceeding.
ARTICLE 28
SURRENDER OF PREMISES
28.1 Upon the expiration or other termination of the term of
this Lease, Tenant shall quit and surrender to Landlord the demised premises,
broom clean, in good order and condition, ordinary wear and tear and damage by
fire, the elements or other casualty that Tenant is not required to repair
excepted, and Tenant shall remove all of its property as herein provided.
Tenant's obligation to observe or perform this covenant shall survive the
expiration or other termination of the term of this Lease. If Tenant remains in
possession of the demised premises
<PAGE> 56
after the termination of this Lease without the execution of a new lease,
Tenant, at the option of Landlord, shall be deemed to be occupying the demised
premises as a tenant from month to month, subject to all of the other terms and
conditions of this Lease insofar as the same are applicable to a month-to-month
tenancy, but at a monthly rental equal to 200% of the monthly fixed annual rent,
Tax Escalation Payment and Expense Payment last payable by Tenant hereunder.
Nothing contained in this Section 28.1 shall (i) imply any right of Tenant to
remain in the demised premises after the termination of this Lease without the
execution of a new lease, (ii) imply any obligation by Landlord to grant a new
lease or (iii) be construed to limit any right or remedy that Landlord has
against Tenant as a holdover tenant or trespasser.
ARTICLE 29
RULES AND REGULATIONS
29.1 Tenant and Tenant's servants, employees and agents shall
observe faithfully and comply strictly with the Rules and Regulations set forth
in EXHIBIT G attached hereto and made part hereof entitled "Rules and
Regulations" and such other and further reasonable Rules and Regulations as
Landlord or Landlord's agents may from time to time adopt; provided, however,
that in case of any conflict or inconsistency between the provisions of this
Lease and of any of the Rules and Regulations as originally or as hereafter
adopted, the provisions of this Lease shall control. Reasonable written notice
of any additional Rules and Regulations shall be given to Tenant and any dispute
with respect to the reasonableness of any such additional Rules and Regulations
shall be resolved by arbitration in accordance with the Commercial Arbitration
Rules of the American Arbitration Association. Landlord agrees that it shall not
enforce or fail to enforce any of the Rules and Regulations in a manner so as to
apply the same in an unfairly discriminatory manner with respect to Tenant.
Nothing in this Lease contained shall be construed to impose
upon Landlord any duty or obligation to enforce the Rules and Regulations or the
terms, covenants or conditions in any other lease, against any other tenant of
the Building, and Landlord shall not be liable to Tenant for violation of the
same by any other tenant, its servants, employees, agents, visitors or
licensees.
ARTICLE 30
CONSENTS AND APPROVALS
<PAGE> 57
30.1 Wherever in this Lease Landlord's consent or approval is
required and the lease provides that Landlord shall not unreasonably withhold or
delay such consent or approval, if Landlord shall delay or refuse such consent
or approval, Tenant in no event shall 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 unreasonably withheld
or unreasonably delayed its consent or approval. Tenant's sole remedy shall be
an action or proceeding to enforce any such provision, for specific performance,
injunction or declaratory judgment.
30.2 If Tenant desires to determine any dispute between
Landlord and Tenant as to the reasonableness of Landlord's decision to refuse to
consent to (i) any assignment or subletting in accordance with the provisions of
Article 11 hereof with respect to which Landlord expressly agreed not to
withhold its consent, or (ii) any Alteration pursuant to the provisions of
Article 2 or 6 hereof with respect to which Landlord expressly agreed not to
withhold its consent, such dispute shall be settled and finally determined by
arbitration in the County of New York in accordance with the Commercial
Arbitration Rules of the American Arbitration Association.
ARTICLE 31
NOTICES
31.1 Any notice or demand, consent, approval or disapproval,
or statement required to be given by the terms and provisions of this Lease, or
by any law or governmental regulation, either by Landlord to Tenant or by Tenant
to Landlord, shall be in writing. Unless otherwise required by such law or
regulation, such notice, demand, consent, approvals, statement or disapproval
shall be given, and shall be deemed to have been served and given when such
notice or demand is mailed by registered or certified mail deposited enclosed in
a securely closed post-paid wrapper, in a United States Government general or
branch post office, or official depository with the exclusive care and custody
thereof, or delivered to an overnight delivery service requiring a receipt,
addressed to Landlord or to Tenant at its address set forth on page one (1) of
this Lease (except that after the Commencement Date, Tenant's address, unless
Tenant shall give notice to the contrary, shall be the Building, directed to the
attention of General Counsel). At such time as Tenant or anyone claiming under
or through Tenant first occupies the demised premises for the conduct of its
business, all such notices and demands shall be served or given to Tenant at the
demised premises in lieu of its address on page one (1) hereof. Either party
may, by notice as aforesaid, designate a different
<PAGE> 58
address or addresses for notices, demands, consents, approvals statements or
disapprovals.
31.2 In addition to the foregoing, either Landlord or Tenant
may, from time to time, request in writing that the other party serve a copy of
any notice or demand, consent, approval or disapproval, or statement, on one
other person or entity designated in such request, such service to be effected
as provided in Section 31.1 hereof.
ARTICLE 32
NO WAIVER
32.1 No agreement to accept a surrender of this Lease shall be
valid unless in writing signed by Landlord. No employee of Landlord or of
Landlord's agents shall have any power to accept the keys of the demised
premises prior to the expiration or termination of this Lease. The delivery of
keys to any employee of Landlord or of Landlord's agent shall not operate as a
termination of this Lease or a surrender of the demised premises. In the event
of Tenant at any time desiring to have Landlord sublet the premises for Tenant's
account, Landlord or Landlord's agents are authorized to receive said keys for
such purpose without releasing Tenant from any of the obligations under this
Lease. The failure of Landlord to seek redress for violation of, or to insist
upon the strict performance of, any term, provision, covenant or condition of
this Lease or any of the Rules and Regulations set forth herein, or hereafter
adopted by Landlord, shall not prevent a subsequent act, which would have
originally constituted a violation, from having all the force and effect of an
original violation. The receipt by Landlord of rent with knowledge of the breach
of any covenant of this Lease shall not be deemed a waiver of such breach. The
failure of Landlord to enforce any of the Rules and Regulations set forth
herein, or hereafter adopted, against Tenant and/or any other tenant in the
Building shall not be deemed a waiver of any such Rules and Regulations. No
provision of this Lease shall be deemed to have been waived by Landlord, unless
such waiver be in writing signed by Landlord. No payment by Tenant or receipt by
Landlord of a lesser amount than the rent herein stipulated shall be deemed to
be other than on the account of the earliest stipulated rent, nor shall any
endorsement or statement on any check or any letter accompanying any check or
payment of rent be deemed an accord and satisfaction, and Landlord may accept
such check or payment without prejudice to Landlord's right to recover the
balance of such rent or pursue any other remedy in this Lease provided.
32.2 This Lease contains the entire agreement between the
parties, and any executory agreement hereafter made shall be ineffective to
change, modify, discharge or effect an abandonment
<PAGE> 59
of it in whole or in part unless such executory agreement is in writing and
signed by the party against whom enforcement of the change, modification,
discharge or abandonment is sought.
ARTICLE 33
CAPTIONS
33.1 The captions are inserted only as a matter of convenience
and for reference, and in no way define, limit or describe the scope of this
Lease nor the intent of any provision thereof.
ARTICLE 34
INABILITY TO PERFORM
34.1 If, by reason of (i) strike, (ii) labor troubles, (iii)
governmental preemption in connection with a national emergency, (iv) any rule,
order or regulation of any governmental agency, (v) conditions of supply or
demand which are affected by war or other national, state or municipal
emergency, or any other cause or (vi) any other cause beyond Landlord's
reasonable control, Landlord shall be unable to fulfill its obligations under
this Lease or shall be unable to supply any service which Landlord is obligated
to supply, this Lease and Tenant's obligation to pay rent hereunder shall in no
wise be affected, impaired or excused, except as provided in Section 13.2 and
14.1.
ARTICLE 35
NO REPRESENTATIONS BY LANDLORD
35.1 Landlord or Landlord's agents have made no
representations or promises with respect to the Building or demised premises
except as herein expressly set forth.
ARTICLE 36
NAME OF THE BUILDING PROJECT
36.1 Landlord shall have the full right at any time to name or
change the name of the Building Project or the Building and to change the
designated address of the Building Project or the Building.
ARTICLE 37
RESTRICTIONS UPON USE
<PAGE> 60
37.1 It is expressly understood that no portion of the demised
premises shall be used as, by or for (i) a bank, trust company, savings bank,
industrial bank, savings and loan association or personal loan bank (or any
branch office or public accommodation office of any of the foregoing), or (ii) a
public stenographer or typist, barber shop, beauty shop, beauty parlor or shop,
telephone or telegraph agency, telephone or secretarial service, messenger
service, travel or tourist agency, employment agency, public restaurant or bar,
commercial document reproduction or offset printing service, public vending
machines, retail, wholesale or discount shop for sale of merchandise, retail
service shop, labor union, school or classroom, governmental or
quasi-governmental bureau, department or agency, including an autonomous
governmental corporation, an advertising agency, a firm whose principal business
is real estate brokerage, or a company engaged in the business of renting office
or desk space.
ARTICLE 38
INDEMNITY
38.1 Tenant shall indemnify, defend and save Landlord harmless
from and against any liability or expense (including, without limitation,
reasonable attorneys fees and expenses) arising from the use or occupation of
the demised premises by Tenant or anyone in the demised premises with Tenant's
permission, or from the breach of this Lease by Tenant, unless the liability or
expense results from the reckless conduct or negligent acts or omissions of
Landlord, its employees, agents or contractors.
ARTICLE 39
SECURITY DEPOSIT
39.1 Tenant has deposited with Landlord the sum of Fourteen
Thousand Two Hundred sixty-Three 50/100 Dollars ($14,263.50) as security for the
faithful performance and observance by Tenant of the terms, provisions and
conditions of this Lease. Said sum shall be deposited in an interest bearing
account, and the interest shall be paid annually to Tenant, provided that Tenant
is not in material default hereunder beyond any applicable notice and grace
periods. It is agreed that in the event Tenant defaults beyond applicable grace
periods in respect of any of the terms, provisions and conditions of this Lease,
including, but not limited to, payment of fixed annual rent and additional rent,
Landlord may use, apply or retain the whole or any part of the security so
deposited to the extent required for the payment of any rent and additional rent
or any other sum as to which Tenant is in default or for any sum which
<PAGE> 61
Landlord may expend or may be required to expend by reason of Tenant's default
in respect of any of the terms, covenants and conditions of this Lease,
including but not limited to, any damages or deficiency in the reletting of the
demised premises, whether such damages or deficiency accrued before or after
summary proceedings or other re-entry by Landlord. In the event that Tenant
shall fully and faithfully comply with all of the terms, provisions, covenants
and conditions of this Lease, the security shall be returned to Tenant at the
expiration of this Lease.
39.2 THIS SECTION HAS BEEN INTENTIONALLY DELETED.
39.3 In the event of a sale of the Building or leasing,
conveyance or transfer of the Building, Landlord shall have the right to
transfer the security to the vendee, lessee or transferee and Landlord shall
thereupon be released by Tenant from all liability for the return of such
security; and Tenant agrees to look to the new Landlord solely for the return of
said security; and it is agreed that the provisions hereof shall apply to every
transfer or assignment made of the security to a new Landlord. Tenant further
covenants that it will not assign or encumber or attempt to assign or encumber
the monies deposited herein as security and that neither Landlord nor its
successors or assigns shall be bound by any such assignment, encumbrance,
attempted assignment or attempted encumbrance.
ARTICLE 40
MISCELLANEOUS
40.1 Irrespective of the place of execution or performance,
this Lease shall be governed and construed in accordance with the laws of the
State of New York.
40.2 This Lease shall be construed without regard to any
presumption or other rule requiring construction against the party causing this
Lease to be drafted.
40.3 Except as otherwise expressly provided in this Lease,
each covenant, agreement, obligation or other provision of this Lease on
Tenant's part to be performed shall be deemed and construed as a separate and
independent covenant of Tenant, not dependent on any other provision of this
Lease.
40.4 All terms and words used in this Lease, regardless of the
number or gender in which they are used, shall be deemed to include any other
number and any other gender as the context may require.
40.5 Time shall be of the essence with respect to the
<PAGE> 62
exercise of any option granted under this Lease.
40.6 Except as otherwise provided herein whenever payment of
interest is required by the terms hereof it shall be at the Interest Rate.
40.7 In the event that Tenant is in arrears in payment of
fixed annual rent or additional rent hereunder, Tenant waives Tenant's right, if
any, to designate the items against which any payments made by Tenant are to be
credited, and Tenant agrees that Landlord may apply any payments made by Tenant
to any items it sees fit, irrespective of and notwithstanding any designation or
request by Tenant as to the items against which any such payments shall be
credited.
40.8 Landlord or Landlord's agents have made no
representations or promises with respect to the Building Project or the demised
premises except as herein expressly set forth and no rights, easements or
licenses are acquired by Tenant by implication or otherwise except as expressly
set forth herein. Landlord makes no representation as to the actual rentable
square foot area of the demised premises, the Building, or the other
improvements at the Building Project. By the execution of this Lease, Tenant
hereby accepts possession of the demised premises in the condition in which it
exists on the date hereof "as is" and further agrees that, except as expressly
provided herein, Landlord shall have no obligation to perform any work or make
any installations in order to prepare the demised premises for Tenant's
occupancy. The execution of this lease by Tenant shall be conclusive evidence as
against Tenant, that, on the date hereof, the demised premises and the Building
were in good and satisfactory condition.
40.9 Tenant represents, warrants and covenants that:
(a) Tenant is not an employee benefit plan as defined in
Section 3(3) of the Employee Retirement Income Security Act of 1974, as
amended ("ERISA"), which is subject to Title I of ERISA, nor a plan as
defined in Section 4975(e)(1) of the Internal Revenue Code of 1986, as
amended (each of the foregoing hereinafter referred to collectively as
a "Plan"), nor is Tenant an entity whose assets constitute "plan
assets" of one or more such Plans within the meaning of Department of
Labor Regulation Section 2510.3-101;
(b) Neither Tenant nor any of its affiliates (within the
meaning of Part V(c) of Prohibited Transaction Exemption 84-14 granted
by the United States Department of Labor ("PTE 84-14")) has, or during
the immediately preceding year has exercised, the authority to appoint
or terminate The Prudential Insurance Company of America ("Prudential")
as investment manager of any assets of the employee benefit
<PAGE> 63
plans whose assets are held by Prudential or to negotiate the terms of
any management agreement with Prudential on behalf of any such plan;
(c) Tenant is not a related party of Prudential within the
meaning of Part V(h) of PTE 84-14; and
(d) The representations and warranties in the preceding
subparagraphs (a), (b) and (c) are made for the benefit of the holders
of the mortgages presently encumbering the Building (and their
successors) and shall be deemed to be made for the benefit of such
holders (and their successors). Such representations and warranties
shall not be modified or rescinded without the written consent of such
holders (or their successors).
(e) The execution, delivery and performance by Tenant of this
Lease have been duly authorized by all necessary corporate action.
ARTICLE 41
COMMON AREAS AND PARKING
41.1 Landlord shall provide and shall make available from time
to time within the boundaries of the Land such parking facilities, driveways,
entrances and exits thereto, landscape and planted areas, and other improvements
and facilities, as Landlord shall at any time and from time to time deem
appropriate (all the foregoing being collectively referred to in this Lease as
"COMMON AREAS"). Tenant and its officers, employees, agents, customers and
invitees shall have a nonexclusive right, in common with Landlord and other
tenants and occupants of the Building Project (and their employees and invitees)
and contractors working at the Building Project to whom Landlord has granted or
may hereafter grant rights, to use the Common Areas. The Common Areas shall at
all times be subject to the exclusive control and management of Landlord, and
Landlord shall have the right from time to time to establish, modify and enforce
reasonable rules and regulations with respect to the Common Areas, and Tenant
agrees, after notice thereof, to abide by such rules and regulations and to
cause its officers, employees, agents, customers and invitees to conform
thereto. Landlord shall construct, operate, manage, equip, repair, landscape,
and maintain the Common Areas for their intended purposes in such manner as
Landlord shall, in Landlord's sole discretion, from time to time determine.
Landlord's rights respecting the Common Areas shall include (but shall not be
limited to) the following:
(i) to construct, maintain and operate lighting facilities
serving the Common Areas;
<PAGE> 64
(ii) from time to time to change the area, level, location and
arrangement of parking areas and other Common Area facilities, to make
installations therein and to move or remove such installations, and to
change the location of, or permanently diminish or discontinue the use
of, any portion of the Common Areas provided the number of parking
spaces available for Tenant's use shall not be materially reduced;
(iii) to restrict parking by tenants, their officers, agents,
employees, customers and invitees, to designated areas;
(iv) to discontinue, or restrict the use of, any portion of
the Common Areas to such extent, and for such period of time, as may in
the opinion of Landlord's counsel be necessary to prevent a dedication
thereof or the accrual of any rights to any person or the public
therein;
(v) to temporarily suspend the use of all, or any portion of,
the Common Areas if required to comply with laws or the requirements of
Landlord's insurers or to make any repairs or alterations thereto or if
necessary in connection with the maintenance thereof; and
(vi) to take any other action with respect to the Common
Areas, as Landlord, in its sole discretion, shall determine to be
advisable.
41.2 Tenant's right to use the Common Areas shall be deemed to
be an irrevocable license coterminous with the term of this Lease, and Landlord
shall not be subject to any liability nor shall Tenant be entitled to any
compensation or diminution or abatement of rent by reason of Landlord's exercise
of any right or rights respecting Common Areas reserved pursuant to Section 41.1
hereof, nor shall the exercise of any such right be deemed a constructive or
actual eviction.
41.3 Tenant shall be entitled to free use of a total of six
(6) parking spaces (five (5) unreserved parking spaces in common with others and
one (1) reserved parking space within close proximity to the Building). Tenant
agrees that if Landlord shall designate specific parking spaces, it or its
employees and invitees shall only use such designated parking spaces. Landlord
agrees that it will not designate any such parking spaces in a discriminatory
manner with respect to Tenant.
41.4 With respect to the parking of vehicles at the Building
Project:
(a) If Landlord elects to designate a specific parking
<PAGE> 65
area for Tenant's use, Tenant shall require its personnel and visitors to park
their vehicles only in parking spaces designated by Landlord for Tenant's use
for its personnel and visitors on a "first come, first served" basis. Landlord
reserves the right at all times to redesignate such parking spaces. Tenant, its
personnel and visitors shall not at any time park any trucks or delivery
vehicles in any of the parking areas;
(b) all parking spaces and any other parking areas used by
Tenant, its personnel and visitors will be at their own risk, and Landlord shall
not be liable for any injury to person or property, or for loss or damage to any
automobile or its contents, resulting from theft, collision, vandalism or any
other cause whatsoever;
(c) there shall be no overnight parking and Tenant shall, and
shall cause its personnel and visitors to, remove their automobiles from the
parking area at the end of their working day. If any automobile owned by Tenant
or by its personnel or visitors remains in the parking area overnight and the
same interferes with the cleaning or maintenance of said area (snow or
otherwise), any costs or liabilities incurred by Landlord in removing said
automobile to effectuate cleaning or maintenance, or any damages resulting to
said automobile or to Landlord's equipment or equipment owned by others by
reason of the presence of or removal of said automobile during such cleaning or
maintenance shall be paid by Tenant to Landlord, as additional rent on the rent
payment date next following the submission of a bill therefor; and
(d) Tenant agrees not to use, or permit its employees or
invitees to use, any portion of the parking areas which have been designated for
the exclusive use of another tenant in the Building Project.
ARTICLE 42
EXTENSION OF TERM
42.1 Tenant shall have the right to extend the term of this
Lease for one (1) additional term of one (1) year (the "EXTENSION TERM").
42.2 (a) The Extension Term shall commence upon the day
following the Expiration Date and shall end on the last day of the calendar
month in which occurs the day preceding the fifth (5th) anniversary of the
commencement of the Extension Term. The option contained in this Section 41.2
shall be subject to the following terms and conditions:
(i) Tenant shall give Landlord notice (hereinafter
<PAGE> 66
called the "EXTENSION NOTICE") of its election to extend the term of
this Lease at least nine (9) months prior to the commencement of the
Extension Term;
(ii) Tenant is not in default under the Lease in any material
respect (beyond any applicable grace period) as of the time of the
giving of the Extension Notice and the commencement of the Extension
Term unless Landlord shall waive any such default in writing;
(iii) Tenant named herein is the actual occupant of not less
than fifty percent (50%) of the usable area of the demised premises as
of the time of the giving of the Extension Notice and the commencement
of the Extension Term; and
(iv) Simultaneous with the giving of the Extension Notice
hereunder, Tenant shall exercise the extension option contained in the
lease of space which adjoins the demised premises.
(b) The fixed annual rent payable by Tenant to Landlord during
the Extension Term shall be the higher of (i) Forty-Two Thousand Seven Hundred
Ninety 50/100 Dollars ($42,790.50) per year, or (ii) the then fair market rent
for the demised premises (as determined in accordance with Section 42.4
herein).
42.3 THIS SECTION HAS BEEN INTENTIONALLY DELETED.
42.4 (a) After Landlord receives a notice from Tenant as
specified in Section 42.2(i), it shall make the initial determination of the
fixed annual rent for the Extension Term ("LANDLORD'S SUBMITTED RENT"), which
determination will be Landlord's statement of the then fair market rent (as
defined in Section 42.4(b) hereof) of the demised premises. Landlord shall give
notice to Tenant of Landlord's Submitted Rent within thirty (30) days after
receipt of such notice from Tenant. If Landlord and Tenant shall fail to agree
upon the fixed annual rent for the Extension Term, within thirty (30) days after
delivery of such notice by Landlord, then Landlord and Tenant each shall give
notice to the other setting forth the name and address of an arbitrator
designated by the party giving such notice. If either party shall fail to give
notice of such designation within ten (10) Business Days of the end of such
thirty (30) day period, then the arbitrator chosen shall make the determination
alone. If two arbitrators shall have been designated, within thirty (30) days
thereafter such two arbitrators shall make their determinations of fixed annual
fair market rent, as defined in Section 42.4(b), for the Extension Term, in
writing and give notice thereof to each other and to Landlord and Tenant. Such
<PAGE> 67
two arbitrators shall have thirty (30) days after the receipt of notice of each
other's determinations to confer with each other and to attempt to reach
agreement as to the determination of fixed annual rent for the Extension Term.
If such two arbitrators shall concur as to the determination of such fixed
annual rent, such concurrence shall be final and binding upon Landlord and
Tenant. If such two arbitrators shall fail to concur, then such two arbitrators
shall immediately designate a third arbitrator. If the two arbitrators shall
fail to agree upon the designation of such third arbitrator within five (5)
days, then either party may apply to the American Arbitration Association or any
successor thereto having jurisdiction for the designation of such arbitrator.
All arbitrators shall be real estate appraisers or consultants who shall have
had at least ten (10) years continuous experience in the business of appraising
or managing real estate or acting as real estate agents or brokers in the County
of Westchester and shall not be affiliated with Landlord or Tenant. The third
arbitrator shall conduct such hearings and investigations as he may deem
appropriate and shall, within thirty (30) days after his designation, choose one
of the determinations of the two arbitrators originally selected by the parties,
and that choice by the third arbitrator shall be binding upon Landlord and
Tenant. Each party shall pay its own counsel fees and expenses, if any, in
connection with any arbitration under this Section, including the expenses and
fees of any arbitrator selected by it in accordance with the provisions of this
Section, and the parties shall share equally all other expenses and fees of any
such arbitration. The determination rendered in accordance with the provisions
of this Section shall be final and binding in fixing the fixed annual rent for
the Extension Term. The arbitrators shall not have the power to add to, modify
or change any of the provisions of this Lease.
(b) "FAIR MARKET RENT" for purposes of this Article 42 shall
mean the rental rate that would be paid in an arms-length transaction between a
landlord who is under no compulsion to lease and a tenant who is under no
compulsion to rent the premises in question, based upon the rental market for
comparable premises in comparable buildings in Westchester County under terms
(other than those pertaining to the payment of fixed annual rent) similar to
those in this Lease.
(c) Prior to the determination of the arbitrators, Tenant
shall pay as the fixed annual rent for the Extension Term, the fixed annual rent
payable for the immediately preceding term, and in the event the arbitrators
determine that the fixed annual rent payable pursuant to this Section 42.4 is
more than that being paid by Tenant, then Tenant shall pay the amount of such
underpayment, with interest thereon at the Interest Rate, within thirty-five
(35) days after the arbitrators' determination.
<PAGE> 68
(d) For the purposes of facilitating the computations of sums
due for fair market rent pursuant to Section 42.4(b): the sums payable pursuant
to Articles 3 and 4, as calculated on a per square foot basis, for the Lease
Year immediately preceding the commencement of the Extension Term shall be
subtracted from the gross fixed annual rent for the Extension Term determined
pursuant to this Section 42.4, as calculated on a per square foot basis; and in
computing escalations with respect to such space under Articles 3 and 4 hereof
the Land Tax Base Factor, the Building Tax Base Factor, the Building Expense
Base Factor and the Non-Building Expense Base Factor shall remain unchanged.
42.5 Except as provided in Section 42.2 hereof, Tenant's
occupancy of the demised premises during the Extension Term shall be on the same
terms and conditions as are in effect immediately prior to the commencement of
the Extension Term, provided, however, that upon the expiration of the Extension
Term Tenant shall have no further right to extend the term of this Lease and
Landlord shall not be required to perform any work to prepare the demised
premises for Tenant's occupancy.
42.6 If Tenant does not send an Extension Notice pursuant to
provisions of Section 42.2, this Article 42 hereof shall have no force or effect
and the term of this Lease shall expire on the last day of the initial term
hereof. At such time as Tenant exercises its option pursuant to this Article 42,
Landlord or Tenant can request the other party hereto to execute an instrument
setting forth the exercise of Tenant's right to extend the term of this Lease
and the last day of the Extension Term.
42.7 At such time as Tenant exercises its right to extend the
term of this Lease as herein provided, the phrases "the term of this Lease" or
"the term hereof" as used in this Lease, shall be construed to include, when
practicable, the Extension Term.
<PAGE> 69
IN WITNESS WHEREOF, Landlord and Tenant have respectively
executed this Lease as of the day and year first above written.
PURCHASE CORPORATE PARK
ASSOCIATES, L.P., Landlord
By: PCPA, LLC, the General Partner
By: /s/ Warren L. Schwerin
------------------------------
Warren L. Schwerin,
a Co-Managing Member
INTERLIANT, INC., Tenant
By: /s/ Leonard Fassler
------------------------------
Name: Leonard Fassler
Title: Co-Chairman
<PAGE> 70
EXHIBIT A
SITE PLAN
<PAGE> 71
EXHIBIT B
DESCRIPTION OF LAND
All that certain plot, piece or parcel of land, situate, lying
and being in the Town/Village of Harrison, County of Westchester and State of
New York, being a 42.642 Acre Parcel of land shown and delineated on Map Number
20975 filed in the Office of the Clerk of Westchester County (Division of Land
Records) on July 26th, 1982; said parcel also being a portion of Parcels "C" and
"D" as shown on Map Number 19488 filed in the Office of the Clerk of Westchester
County (Division of Land Records) on May 22nd, 1978, being more particularly
bounded and described as follows:
BEGINNING at a point on the northeasterly side of Route I-684
where the same is intersected by the southerly line of land now or formerly of
Whitelaw Reid, said point being the northwesterly corner of Parcel "C" as shown
on Filed Map No.
19488;
running thence along said land of Whitelaw Reid, the following
courses and distances:
North 72(degree) 13' 05" East 321.205 feet,
North 84(degree) 509' 40" East 333.53 feet,
North 44(degree) 11' 00" East 453.19 feet,
North 48(degree) 58' 00" East 29.71 feet,
North 65(degree) 11' 30" East 200.54 feet and
North 65(degree) 51' 30" East 56.95 feet to the
division line between Parcel "C" and Parcel "F" and the southwesterly corner of
said Parcel "F" as shown on Filed Map No.
19488;
thence easterly along said division line along a curve to the
right having a radius of 600.00 feet, the radial of which at its westerly end
bears North 14(degree) 00' 31" West, said curve having a central angle
22(degree) 38' 22" a distance of 237.079 feet to the division line between
Parcel "B" and Parcel "C" as shown on Filed Map No. 19488;
thence along said division line, South 2(degree) 52' 00" West
720.135 feet to the division line between Parcel "C" and Parcel "B";
thence along said division line, commencing in a northerly
direction along a curve to the left having a radius of 70.00 feet, a central
angle of 271(degree) 27' 23", a distance of 331.65 feet to a point of reverse
curve;
thence along a curve to the right having a radius of 50.00
feet, a central angle of 48(degree) 11' 23" a distance of 42.05 feet to a point
of tangency;
<PAGE> 72
thence continuing along the division line between Parcel "C"
and Parcel "B", South 40(degree) 24' 00" East 693.099 feet to a point of curve;
thence along a curve to the right having a radius of 50.00
feet, a central angle of 64(degree) 21' 26" a distance of 56.162 feet to a
point, said point being a non-tangent intersection on Parcel 228 as shown on
Filed Map No. 20781;
thence along the highway right-of-way, as established per said
filed Map No. 20781 as follows: In a southwesterly direction along a curve to
the left having a radius of 751.20 feet a central angle of 9(degree) 29' 38" a
distance of 124.473 feet to a point of tangency; South 33(degree) 30' 33" West
447.23 feet, South 57(degree) 19' 19" West 23.62 feet, South 72(degree) 58' 51"
West 78.52 feet, and South 67(degree) 39' 54" West 138.766 feet to a non-tangent
intersection with the division line between Parcel "C" and Parcel "D" as shown
on Filed Map No. 19488;
thence along said division line in a northwesterly direction
along a curve to the right having a radius of 400.00 feet, a central angle of
19(degree) 46' 54" a distance of 138.101 feet to a point of tangency and
northeasterly side of Route I-684;
thence along the northeasterly side of Route I-684, the
following courses and distances:
North 63(degree) 19' 08" West 462.679 feet,
South 45(degree) 59' 00" West 593.505 feet,
South 45(degree) 30' 27" West 138.225 feet, and
South 23(degree) 35' 05" West 535.16 feet, to the point and
place of Beginning.
<PAGE> 73
EXHIBIT C
FLOOR PLAN
<PAGE> 74
EXHIBIT D
THIS EXHIBIT HAS BEEN INTENTIONALLY DELETED.
<PAGE> 75
EXHIBIT E
HVAC SPECIFICATIONS
H.V.A.C.:
Year round air conditioning systems capable of providing and maintaining design
criteria as follows:
Design Condition Inside Condition Outside Condition
- ---------------- ---------------- -----------------
Cooling Cycle 76 degr. D.B.F. 90 degr. D.B.F.
50% R.H. 77 degr. W.B.F.
Heating Cycle 65 degr. F. 0 degr. F.
These design standards are based on an occupancy of not more than one (1) person
per 150 square feet and a total connected load not to exceed 3 watts per square
foot for lighting and standard electrical office power, all in accordance with
State and Federal regulations.
The system shall be designed to furnish not less than .05 cubic feet per minute
of fresh air and not less than 1.0 cubic feet per minute of total supply air per
square foot of the premises.
The air conditioning system shall combine use of periphery heating and one (1)
variable volume air conditioning control unit per 1,500 square feet with ceiling
diffusers and thermostatic controls.
<PAGE> 76
EXHIBIT F
CLEANING SPECIFICATIONS
FOR
THE CENTRE AT PURCHASE
GENERAL OFFICE AND PUBLIC AREAS
Daily
1. Sweep or dry mop all resilient tile and wood floors;
remove gum, tar, etc. adhering to floors.
2. Empty and damp wipe all ashtrays.
3. Empty and damp wipe waste baskets.
4. Remove trash to designated area.
5. Dust all horizontal surfaces with treated dust cloths;
this includes furniture, files, equipment, blinds,
louvers, etc. that can be reached without use of a
ladder.
6. Damp wipe with germicidal solutions all telephones
(including dials and crevices).
7. Spot clean to remove smudges, marks and fingerprints from
walls, equipment, doors, partitions, light switches, etc.
within reach.
8. Wash chalk boards as requested by tenants.
9. Wash water fountains with germicidal solution.
10. Wash cafeteria tables and chairs.
11. Damp mop all non resilient floors such as terrazzo, ceramic tile,
quarry, tile, etc.
12. Thoroughly clean all elevator cabs and landing doors.
13. Clean lobby entrance doors and glass.
14. Turn off all lights when areas have been cleaned.
Weekly
1. Wash glass in display windows, building directory,
entrance doors and show windows, both sides.
2. Spot clean interior partitions and desk glass to remove
smudge marks.
<PAGE> 77
3. Sweep all stair areas.
4. Scrub and recondition resilient tile floors.
5. Brush all fabric covered chairs with lint brush.
6. Vacuum three times weekly.
Monthly
1. Scrub and recondition resilient tile floors using buffable
non slip floor finish.
2. Vacuum all ceiling and wall air supply and exhaust diffusers
and grills.
3. Wash all stairwell landing and treads.
Quarterly
1. High dust all horizontal and vertical surfaces not reached in nightly
cleaning such as pipes, light fixtures, door frames, picture frames,
etc.
2. Vacuum or dust all books in place.
3. Wash and polish vertical terrazzo or marble surfaces.
4. Damp wipe diffusers, vents, grills, etc., including surrounding wall or
ceiling areas that are soiled.
Semi-Annually
1. Wash exterior windows.
Annually
1. Wash light fixtures including reflectors, globes, diffusers
and trim.
2. Wash walls in corridors, lobbies and cafeteria.
3. Clean all vertical surfaces not attended to in nightly,
weekly, monthly or quarterly schedules.
RESTROOMS
Daily
1. Clean mirrors, soap dispensers, shelves, basins, exposed
plumbing, dispensers and disposal units using disinfectant
solution.
<PAGE> 78
2. Damp wipe all ledges, toilet stalls and doors.
3. Spot clean light switches, doors and walls.
4. Thoroughly clean commodes and urinals with disinfectant
solution.
5. Pour one ounce of bowl cleaner into bowls and urinals when
finished cleaning. Do not flush.
6. Remove all trash to designated area.
7. Refill all soap, toilet tissue and towel and other
dispensers.
8. Damp mop tile floors with disinfectant solution.
9. Clean all baseboards.
Weekly
1. Brush all fabric covered chairs and couches in the Ladies
lounges with a lint brush.
Monthly
1. Vacuum all ceiling and wall air supply and exhaust units.
Quarterly
1. High dust all horizontal and vertical surfaces not reached
in nightly cleaning.
2. Damp wash diffusers, vents and grills.
Annually
1. Wash light fixtures.
2. Wash walls with disinfectant solution.
3. Machine scrub floors using disinfectant solutions.
<PAGE> 79
EXHIBIT G
RULES AND REGULATIONS
1. The sidewalks and public portions of the Building, such as
entrances, passages, courts, elevators, vestibules, stairways, corridors or
halls shall not be obstructed or encumbered by any tenant or used for any
purpose other than ingress and egress to and from the demised premises.
2. No awnings or other projections shall be attached to the
outside walls of the Building. No curtains, blinds, shades, louvered openings or
screens shall be attached to or hung in, or used in connection with, any window
or door of the demised premises, without the prior written consent of Landlord,
unless installed by Landlord.
3. Except as provided in the Lease, no sign, advertisement,
notice or other lettering shall be exhibited, inscribed, painted or affixed by
any tenant on any part of the outside of the demised premises or Building or on
corridor walls. Signs on entrance door or doors shall be subject to Landlord's
approval which shall not be unreasonably withheld. Signs on doors shall, at the
tenant's expense, be inscribed, painted or affixed for each tenant by sign
makers approved by Landlord, which approval shall not be unreasonably withheld.
In the event of the violation of the foregoing by any tenant, Landlord may
remove same without any liability, and may charge the expense incurred by such
removal to the tenant or tenants violating this rule.
4. The sashes, sash doors, skylights, windows, heating,
ventilating and air conditioning vents and door that reflect or admit light and
air into the halls, passageways or other public places in the Building shall not
be covered or obstructed by any tenant, nor shall any bottles, parcels, or other
articles be placed outside of the demised premises.
5. No show cases or other articles shall be put in front of or
affixed to any part of the exterior of the Building, nor placed in the public
halls, corridors or vestibules without the prior written consent of Landlord.
6. Intentionally omitted.
7. The water and wash closets and other plumbing fixtures
shall not be used for any purposes other than those for which they were
constructed, and no sweepings, rubbish, rags, or other substances shall be
thrown therein. All damages resulting from any misuse of the fixtures shall be
borne by the tenant who, or whose servants, employees, agents, visitors or
licensees,
<PAGE> 80
shall have caused the same.
8. No tenant shall in any way deface any part of the demised
premises or the Building of which they form a part. No tenant shall lay
linoleum, or other similar floor covering, so that the same shall come in direct
contact with the floor of the demised premises, and, if linoleum or other
similar floor covering is desired to be used, an interlining of builder's
deadening felt shall be first affixed to the floor, by a paste or other
material, soluble in water, the use of cement or other similar adhesive material
being expressly prohibited.
9. No bicycles, vehicles or animals of any kind (except seeing
eye dogs) shall be brought into or kept in or about the premises. No cooking
shall be done or permitted by Tenant in the demised premises except in
conformity to law and then only in the utility kitchen, if any, as set forth in
Tenant's layout, which is to be primarily used by Tenant's employees for heating
beverages and light snacks. No tenant shall cause or permit any unusual or
objectionable odors to be produced upon or permeate from the demised premises.
10. No space in the Building shall be used for the
manufacturing or distribution or for the storage of merchandise or for the sale
at auction or manufacture, or otherwise of merchandise, goods or property of any
kind.
11. No tenant shall make, or permit to be made, any unseemly
or disturbing noises or disturb or interfere with occupants of the Building or
neighboring buildings or premises or those having business with them, whether by
the use of any musical instrument, radio, talking machine, unmusical noise,
whistling, singing, or in any other way. No tenant shall throw anything out of
the doors, or windows or down the passageways.
12. No tenant, nor any of the tenant's servants, employees,
agents, visitors or licensees, shall at any time bring or keep upon the demised
premises any inflammable, combustible or explosive fluid, or chemical substance,
other than reasonable amounts of cleaning fluids, reproduction fluids and
solvents required in the normal operation of tenant's business offices.
13. No additional locks or bolts of any kind shall be placed
upon any of the doors or windows by any tenant, nor shall any changes be made in
existing locks or the mechanism thereof, without the prior written approval of
the Landlord and unless and until a duplicate key is delivered to Landlord,
except with respect to security areas so designated by Tenant, which shall in no
event exceed five percent (5%) of the rentable area of the demises premises.
Each tenant must, upon the termination of his tenancy, restore to the Landlord
all keys of stores, offices and toilet rooms, either furnished to, or otherwise
procured by, such
<PAGE> 81
tenant, and in the event of the loss of any keys, so furnished, such tenant
shall pay to Landlord the cost thereof.
14. All removals, or the carrying in or out of any safes,
freight, furniture or bulky matter of any description must take place during the
hours which Landlord or its agent may determine from time to time. Landlord
reserves the right to inspect all freight to be brought into the Building and to
exclude from the Building all freight which violates any of these Rules and
Regulations or the Lease of which these Rules and Regulations are a part.
15. Intentionally omitted.
16. Landlord shall have the right to prohibit any advertising
by any tenant mentioning the Building which, in Landlord's reasonable opinion,
tends to impair the reputation of the Building or its desirability as a building
for offices, and upon written notice from Landlord, tenants shall refrain from
or discontinue such advertising.
17. In order that the Building can and will maintain a uniform
appearance to those outside of same, each tenant in building perimeter areas
shall (a) use only building standard lighting in areas where lighting is visible
from the outside of the Building and (b) use only building standard venetian or
vertical blinds in window areas which are visible from the outside of the
Building.
18. Landlord reserves the right to exclude from the Building
between the hours of 6:30 p.m. and 7:30 a.m. and at all hours on non-business
days all persons who do not present a pass to the Building signed by a tenant.
Each tenant shall be responsible for all persons for whom such pass is issued
and shall be liable to Landlord for all acts of such persons.
19. The premises shall not be used for lodging or sleeping or
for any immoral or illegal purpose.
20. The requirements of tenants will be attended to only upon
application at the office of the Building. Building employees shall not perform
any work or do anything outside of their regular duties, unless under special
instructions from the office of the Landlord.
21. Intentionally omitted.
22. Canvassing, soliciting and peddling in the Building are
prohibited and each tenant shall cooperate to prevent the same.
23. There shall not be used in any space, or in the
<PAGE> 82
public halls of any building, either by any tenant or by jobbers or others, in
the delivery or receipt of merchandise, any hand trucks, except those equipped
with rubber tires and side guards. No hand trucks shall be used in passenger
elevators which have not been prepared for use to carry freight.
24. Tenants, in order to obtain maximum effectiveness of the
cooling system, shall lower and/or close venetian or vertical blinds or drapes
when sun's rays fall directly on windows of demised premises.
25. After the initial work, replacement of ceiling tiles after
they are removed for Tenant by telephone company installers, in the public
corridors, will be charged to Tenant on a per tile basis.
Whenever and to the extent that the above rules conflict with
any of the rights or obligations of Tenant pursuant to the provisions of the
Articles of this Lease, the provisions of the Articles shall govern.
<PAGE> 83
EXHIBIT H
THIS EXHIBIT HAS BEEN INTENTIONALLY DELETED.
<PAGE> 1
Exhibit 10.29
================================================================================
AGREEMENT OF LEASE
between
PURCHASE CORPORATE PARK ASSOCIATES, L.P.
Landlord,
and
INTERLIANT, INC.
Tenant,
Dated: June 16, 1999
PREMISES:
THE CENTRE AT PURCHASE
TWO MANHATTANVILLE ROAD
PURCHASE, NEW YORK
A portion of the 1st Floor
================================================================================
Interliant-II
<PAGE> 2
TABLE OF CONTENTS
Page
----
ARTICLE 1 PREMISES, COMMENCEMENT OF TERM, TERM AND RENT...............1
ARTICLE 2 LAYOUT AND FINISH...........................................3
ARTICLE 3 TAX ESCALATION..............................................5
ARTICLE 4 EXPENSE ESCALATION.........................................10
ARTICLE 5 USE........................................................17
ARTICLE 6 ALTERATIONS AND INSTALLATIONS..............................18
ARTICLE 7 REPAIRS....................................................21
ARTICLE 8 REQUIREMENTS OF LAW........................................23
ARTICLE 9 INSURANCE, LOSS, REIMBURSEMENT, LIABILITY..................24
ARTICLE 10 LANDLORD'S LIABILITY.......................................26
ARTICLE 11 ASSIGNMENT, MORTGAGING, SUBLETTING, ETC....................27
ARTICLE 12 ELECTRICITY................................................31
ARTICLE 13 DAMAGE BY FIRE OR OTHER CAUSE..............................34
ARTICLE 14 CONDEMNATION...............................................36
ARTICLE 15 ACCESS TO DEMISED PREMISES; CHANGES........................37
ARTICLE 16 DEFAULT....................................................38
ARTICLE 17 RE-ENTRY BY LANDLORD, INJUNCTION...........................40
ARTICLE 18 DAMAGES....................................................41
ARTICLE 19 LANDLORD'S RIGHT TO PERFORM TENANT'S OBLIGATIONS...........43
ARTICLE 20 QUIET ENJOYMENT............................................44
ARTICLE 21 SERVICES AND EQUIPMENT.....................................44
ARTICLE 22 DEFINITIONS................................................47
ARTICLE 23 INVALIDITY OF ANY PROVISION................................48
<PAGE> 3
ARTICLE 24 BROKERAGE..................................................48
ARTICLE 25 SUBORDINATION..............................................49
ARTICLE 26 CERTIFICATES OF LANDLORD AND TENANT........................50
ARTICLE 27 LEGAL PROCEEDINGS WAIVER OF JURY TRIAL.....................52
ARTICLE 28 SURRENDER OF PREMISES......................................52
ARTICLE 29 RULES AND REGULATIONS......................................53
ARTICLE 30 CONSENTS AND APPROVALS.....................................53
ARTICLE 31 NOTICES....................................................54
ARTICLE 32 NO WAIVER..................................................55
ARTICLE 33 CAPTIONS...................................................56
ARTICLE 34 INABILITY TO PERFORM.......................................56
ARTICLE 35 NO REPRESENTATIONS BY LANDLORD.............................56
ARTICLE 36 NAME OF THE BUILDING PROJECT...............................56
ARTICLE 37 RESTRICTIONS UPON USE......................................56
ARTICLE 38 INDEMNITY..................................................57
ARTICLE 39 SECURITY DEPOSIT...........................................57
ARTICLE 40 MISCELLANEOUS..............................................58
ARTICLE 41 COMMON AREAS AND PARKING...................................60
ARTICLE 42 EXTENSION OF TERM..........................................62
ARTICLE 43 EARLY TERMINATION..........................................65
EXHIBITS
EXHIBIT A SITE PLAN.................................................A-1
EXHIBIT B DESCRIPTION OF LAND.......................................B-1
EXHIBIT C FLOOR PLAN................................................C-1
EXHIBIT D THIS EXHIBIT HAS BEEN INTENTIONALLY DELETED...............D-1
EXHIBIT E HVAC SPECIFICATIONS.......................................E-1
EXHIBIT F CLEANING SPECIFICATIONS...................................F-1
EXHIBIT G RULES AND REGULATIONS.....................................G-1
<PAGE> 4
EXHIBIT H THIS EXHIBIT HAS BEEN INTENTIONALLY DELETED...............H-1
<PAGE> 5
AGREEMENT OF LEASE made as of this 16th day of June, 1999,
between PURCHASE CORPORATE PARK ASSOCIATES, L.P., a New York limited partnership
having an office at Two Manhattanville Road, Purchase, New York 10577
(hereinafter referred to as "LANDLORD") and INTERLIANT, INC., a Delaware
corporation having an office at 11 Martine Avenue, 12th Floor, White Plains, New
York 10606 (hereinafter referred to as "TENANT").
W I T N E S S E T H :
Landlord and Tenant hereto, for themselves, their heirs,
distributees, executors, administrators, legal representatives, trustees,
successors and assigns, hereby covenant and agree as follows:
ARTICLE 1
PREMISES, COMMENCEMENT OF TERM, TERM AND RENT
1.1 Landlord hereby leases to Tenant and Tenant hereby hires
from Landlord, subject to any ground leases and/or underlying leases and/or
mortgages as hereinafter provided, and upon and subject to the covenants,
agreements, terms, provisions and conditions of this Lease, in the building
designated Building A/B on the site plan annexed hereto as EXHIBIT A
(hereinafter referred to as the "BUILDING") on land (the "LAND") located in the
Town of Harrison, County of Westchester, State of New York and as more
particularly described in EXHIBIT B annexed hereto, in the office park commonly
known as "THE CENTRE AT PURCHASE", the following space: a portion of the first
(1st) floor designated on EXHIBIT C annexed hereto (the "DEMISED PREMISES"). The
term of this Lease shall commence on July 1, 2002 (hereinafter referred to as
the "COMMENCEMENT DATE") and shall end on June 30, 2004 (hereinafter referred to
as the "EXPIRATION DATE") or until such term shall earlier cease and terminate
as hereinafter provided.
1.2 Tenant shall pay to Landlord a fixed annual rent ("FIXED
ANNUAL RENT") of One Hundred Seventy-Seven Thousand Forty-Five 00/100 Dollars
($177,045.00) per year, for the period commencing on the Commencement Date and
ending on the Expiration Date.
Tenant agrees to pay the fixed annual rent in lawful money of
the United States of America, in equal monthly
<PAGE> 6
installments in advance on the first day of each calendar month during the term
of this Lease, at the office of Landlord or such other place in the United
States of America as Landlord may designate, without any setoff or deduction
whatsoever, except such deduction as may be occasioned by the occurrence of any
event permitting or requiring a deduction from or abatement of rent as
specifically set forth in Articles 13 and 14 hereof.
1.3 Tenant shall pay the fixed annual rent and additional rent
as above and as hereinafter provided, by good and sufficient check (subject to
collection) drawn on a bank which is a member of the New York Clearinghouse
Association or another bank approved in writing by Landlord. Tenant is paying
the first month's rent upon the execution hereof. Fixed annual rent and the
monthly payments set forth in Section 4.4(b)(i) shall be paid when due in
accordance with the terms of this Lease. All other sums payable by Tenant
hereunder shall be payable within ten (10) days after written demand for same,
unless other payment dates are hereinafter provided. All sums other than fixed
annual rent payable by Tenant hereunder shall be deemed additional rent, the
default in the payment of which Landlord shall have the same remedies as for a
default in the payment of fixed annual rent.
1.4 If Tenant shall fail to pay when due any installment of
fixed annual rent for a period of ten (10) days after written notice is given to
Tenant that such installment shall have become due, or if Tenant shall fail to
pay any payment of additional rent for a period of ten (10) days after written
notice is given to Tenant that such payment shall have become due, then without
regard to any other remedies which Landlord may have as a consequence of such
default, Tenant shall pay interest thereon at the "INTEREST RATE" (as such term
is defined in Article 22 hereof), from the date when such installment shall have
become due or notice of such additional rent being due is given (as the case may
be) to the date of the payment thereof, and such interest shall be deemed
additional rent.
ARTICLE 2
LAYOUT AND FINISH
2.1 Tenant has fully inspected the demised premises, is
satisfied with the condition thereof and agrees to accept possession of the
demised premises in their "as is" condition and Landlord is not required to do
any work thereto; provided, however, that notwithstanding the foregoing,
Landlord represents that, as of the Commencement Date, the plumbing, electrical
and HVAC systems serving the demised premises will be in working order.
<PAGE> 7
ARTICLE 3
TAX ESCALATION
3.1 Tenant shall pay to Landlord, as additional rent, tax
escalation in accordance with the provisions of this Article.
3.2 Definitions:
(a) the term "TAX YEAR" shall mean each period of twelve
months, commencing on the first day of January, in which occurs any part of the
term of this Lease;
(b) the term the "A/B BUILDING" or "BUILDING A/B" shall mean
the Building;
(c) the term the "LAND" shall have the meaning set forth in
Article 1.1.;
(d) the term "COMPARATIVE YEAR" shall mean the calendar year
commencing on January 1, 2001 and each subsequent calendar year;
(e) the term "LAND TAXES" shall mean the total of all real
estate and other taxes and special, general, extraordinary or other assessments,
sewer rents, water charges, occupancy taxes, school taxes, and other taxes or
charges of any kind or nature levied, assessed, imposed or attributable at any
time by any governmental authority (including without limitation any town, city,
district, county, village, school district or public transportation authority)
upon or against the Land, and also any tax, assessment, or charge, levied,
assessed or imposed at any time by any governmental authority in connection with
the receipt of income or rents from the Land to the extent that same shall be in
lieu of all or a portion of any of the aforesaid taxes, assessments or charges,
or additions or increases thereof. 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 the Land Taxes, then such franchise, income, transit, profit or other tax or
governmental imposition shall be deemed to be included within the definition of
"LAND TAXES" for the purposes hereof. The term "Land Taxes" shall not be deemed
to include (i) gift or inheritance taxes, (ii) corporate franchise taxes or
similar business taxes imposed on noncorporate business entities, (iii) realty
transfer taxes or real property transfer gains taxes imposed in connection with
the sale of or the lease of all or substantially all of the Land or the A/B
Building, Building C or Building D (as designated on EXHIBIT A), (iv) mortgage
recording taxes or (v) income taxes, except with
<PAGE> 8
respect to any such taxes assessed or imposed in lieu of real estate taxes or
any portion thereof. As to special assessments which are payable over a period
of time extending beyond the term 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 Land Taxes. If, by law,
any assessment shall be payable in installments, then, for the purposes hereof
(i) such assessment shall be deemed to have been payable in the maximum number
of installments permitted by law and (ii) there shall be included in Land Taxes,
for each Tax Year in which such installments may be paid, the installments of
such assessment so becoming payable during such Tax Year, together with interest
payable during such Tax Year;
(f) the term "BUILDING TAXES" shall have the meaning set forth
in (e), above, except that the phrases "Land Taxes" and "Land" shall be changed
to read "Building Taxes" and the "Building", respectively;
(g) the term "LAND TAX BASE FACTOR" shall mean the amount of
Taxes attributable to the Land for the calendar year 2001;
(h) the term "BUILDING TAX BASE FACTOR" shall mean the
Building Taxes for the calendar year 2001;
(i) the term "THE BUILDING PROJECT" shall mean the Land with
all the improvements thereon (including, without limitation, the office
building(s) and parking areas erected thereon);
(j) the term "THE LAND PERCENTAGE," for purposes of computing
the Tax Escalation Payments (as hereinafter defined) to be made pursuant to this
Article 3 and the Expense Payments (as hereinafter defined) to be made pursuant
to Article 4, shall (subject to the provisions of Article 3.10 hereof) mean one
and nine one hundredths percent (1.09%). The Land 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 rentable square
foot area of the office building(s) comprising the Building Project. The parties
agree that the rentable square foot area of the demised premises shall be deemed
to be 6,105 rentable square feet and that the rentable square foot area of the D
Building shall be deemed to be 190,137, the rentable square foot area of the
building designated Building C on EXHIBIT A annexed hereto shall be deemed to be
86,804, the rentable square foot area of the building designated Building A/B on
EXHIBIT A annexed hereto shall be deemed to be 281,837, and that the total
rentable square foot area of all the office building(s) comprising a part of the
Building Project
<PAGE> 9
shall be deemed to be 558,778 rentable square feet. Tenant acknowledges that the
Land Percentage will be adjusted in the event that the rentable area of the
office space comprising the Building Project shall be increased or reduced.
(k) the term "THE BUILDING PERCENTAGE," for purposes of
computing the Tax Escalation Payments (as hereinafter defined) to be made
pursuant to this Article and the Expense Payments (as hereinafter defined],
shall mean two and seventeen one hundredths percent (2.17%). The Building
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 rentable square foot area of the A/B Building. The parties agree
that the rentable square foot area of the demised premises shall be deemed to be
6,105 rentable square feet and that the total rentable square foot area of the
A/B Building shall be deemed to be 281,837 rentable square feet;
(l) the term "TAX ESCALATION STATEMENT" shall mean a written
statement setting forth the amount payable by Tenant for a specified Comparative
Year pursuant to this Article, which Tax Escalation Statement shall be
accompanied by a copy of the applicable tax bills from the taxing authorities
when available; and
(m) the term "TAXES" shall mean collectively the Land Taxes
and the Building Taxes.
3.3 In the event that the Land Taxes payable for any
Comparative Year shall exceed the Land Tax Base Factor, Tenant shall pay a tax
escalation to Landlord, as additional rent for such Comparative Year, in an
amount equal to the Land Percentage of the excess. In the event that the
Building Taxes payable for any Comparative Year shall exceed the Building Tax
Base Factor, Tenant shall pay a tax escalation to Landlord as additional rent
for such Comparative Year, in an amount equal to the Building Percentage of such
excess. Any such amounts being payable by Tenant pursuant to this Section 3.3
are hereinafter called the "TAX ESCALATION PAYMENT." Before or after the start
of each Comparative Year, Landlord shall furnish to Tenant a Tax Escalation
Statement of the Taxes payable for such Comparative Year or reasonable estimates
thereof if bills are not yet available. If the Land Taxes payable or estimated
to be payable for such Comparative Year exceed the Land Tax Base Factor,
additional rent for such Comparative Year in an amount equal to the Land
Percentage of the excess shall be
<PAGE> 10
due from Tenant to Landlord after Landlord has furnished Tenant with the Tax
Escalation Statement. If the Building Taxes payable or estimated to be payable
for such Comparative Year exceed the Building Tax Base Factor, additional rent
for such Comparative Year in an amount equal to the Building Percentage of the
excess shall be due from Tenant to Landlord after Landlord has furnished Tenant
with the Tax Escalation Statement. Tenant agrees to make payments on account of
the additional rent for each Comparative Year in twelve (12) monthly
installments, each in an amount equal to one-twelfth (1/12) of the Tax
Escalation Payment, which installments may be adjusted by Landlord as bills are
received for which estimates were used. If, as finally determined, the amount of
additional rent payable by Tenant to Landlord pursuant to this Section 3.3 for a
Comparative Year shall be greater than (resulting in an underpayment) or be less
than (resulting in an overpayment) the aggregate of all the installments so paid
on account to Landlord by Tenant for such Comparative Year, then, promptly after
the receipt of the Tax Escalation Statement for such Comparative Year and, in
performance of its obligations under this Article, Tenant shall, in the case of
such an underpayment, pay to Landlord an amount equal to such underpayment with
interest thereon at the Interest Rate or Landlord shall, in the case of such an
overpayment, either (i) pay to Tenant an amount equal to such overpayment with
interest thereon at the Interest Rate or (ii) credit against the next
installment(s) of fixed annual rent due from Tenant an amount equal to such
overpayment with interest at the Interest Rate. If a Tax Escalation Statement is
furnished to Tenant after the commencement of the Comparative Year in respect of
which such Tax Escalation Statement is rendered, Tenant shall, within fifteen
(15) days thereafter pay to Landlord an amount equal to those installments of
the total Tax Escalation Payment payable as provided in this Section 3.3 during
the period prior to the first day of the month next succeeding the month in
which the applicable statement has been furnished.
3.4 If, after Tenant shall have made a payment of additional
rent under this Article, the Taxes payable for any Comparative Year on which
such payment of additional rent shall have been based shall be changed, then the
amount payable for that Comparative Year shall be revised to reflect such change
and appropriate adjustments promptly made between Landlord and Tenant. If, after
Tenant shall have made a payment of additional rent under this Article, Landlord
shall receive a refund of any portion of the Taxes payable for any Comparative
Year on which such payment of additional rent shall have been based, as a result
of a reduction of such Taxes by final determination of legal proceedings,
settlement or otherwise, Landlord shall either (i) after receiving the refund
pay to Tenant the Land or Building Percentage, as the case may be, of the refund
or (ii) credit against the next installment(s) of fixed annual rent due from
Tenant an amount equal to the Land or Building Percentage of the refund, as the
case may be.
3.5 The Tax Escalation Statement to be furnished by Landlord
as provided in this Article shall constitute a final determination as between
Landlord and Tenant of the Tax
<PAGE> 11
Escalation Payment for the periods represented thereby unless Tenant shall have
paid the amount thereof and, within sixty (60) days after the Tax Escalation
Statement is furnished, shall give a notice to Landlord that it disputes its
accuracy or its appropriateness which notice shall specify the particular
respects in which the Tax Escalation Statement is inaccurate or inappropriate.
Copies of the tax bills and the relevant records in the tax assessor's office
shall be deemed prima facie evidence of the facts set forth on the Tax
Escalation Statement.
3.6 In no event shall the fixed annual rent under this Lease
be reduced by virtue of this Article.
3.7 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 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. Such 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 due from Tenant, as aforesaid, and Landlord and Tenant shall
thereupon make appropriate adjustments of amounts then owing.
3.8 Landlord's and Tenant's obligation to make the adjustments
referred to in Section 3.3 hereof above shall survive any expiration or
termination of this Lease. After the termination of the Lease, the final
adjustment for the Tax Escalation Payment pursuant to this Article 3 shall be
made as soon as practicable, and if Landlord retains any moneys of Tenant due to
excess payments made by Tenant hereunder, such excess moneys shall be promptly
refunded to Tenant after such final adjustment has been made.
3.9 Any delay or failure of Landlord to bill any Tax
Escalation Payment as provided in this Article 3 shall not constitute a waiver
of or in any way impair the continuing obligation of Tenant to pay such Tax
Escalation Payment.
3.10 Notwithstanding any other provision of this Article 3 to
the contrary, if the parcel of land on which any of the buildings comprising a
part of the Building Project shall be assessed as a separate tax lot, the Land
Percentage and the Land Tax Base Factor shall be appropriately adjusted.
ARTICLE 4
<PAGE> 12
EXPENSE ESCALATION
4.1 Tenant shall pay to Landlord, as additional rent, expense
escalation in accordance with this Article.
4.2 Definitions:
(a) the term "BUILDING EXPENSE BASE FACTOR" shall mean the
amount of Building Expenses incurred for the calendar year 2001;
(b) the term "NON-BUILDING EXPENSE BASE FACTOR" shall mean the
amount of Non-Building Expenses incurred for the calendar year 2001;
(c) the term "EXPENSE ESCALATION STATEMENT" shall mean a
written statement setting forth the amount payable by Tenant for a specified
Comparative Year pursuant to this Article;
(d) the term "BUILDING EXPENSES" shall mean the total amount
of all costs and expenses incurred or paid by Landlord with respect to and in
connection with the operation, maintenance, replacement and/or normal operating
repair of the Building, including, without limitation, the cost incurred for (i)
air conditioning; (ii) mechanical ventilation; (iii) heating; (iv) cleaning
comparable to the Cleaning Specifications annexed as EXHIBIT F; (i) rubbish
removal; (ii) window washing (interior and exterior, including inside
partitions); (iii) elevators; (iv) escalators; (v) porter and matron service;
(vi) electric current including electricity for heating, ventilation,
air-conditioning and exterior lighting to the Building and the parking areas
appurtenant thereto (excluding, however, the cost of any electricity in the
Building directly metered to tenants or otherwise allocable to space in the
Building demised to tenants); (vii) oil, purchased steam or any other fuel
consumed at the Building; (viii) protection and security; (ix) ordinary
maintenance (including but not limited to regular painting of non-tenanted areas
at the Building); (x) maintenance and repair of lobby decorations; (xi) interior
landscape work and maintenance; (xii) premiums for fire, extended coverage, any
boiler, sprinkler, apparatus, war risk (if expressly required by mortgagee of
Landlord) and property damage insurance, rental and plate glass insurance and
any other insurance required by a mortgagee of Landlord; (xiii) supplies; (xix)
wages, salaries, disability benefits, pensions, hospitalization, retirement
plans and group insurance respecting service and maintenance employees of
Landlord; (xx) uniforms and working clothes for such employees and the cleaning
thereof; (xxi) expenses imposed on Landlord pursuant to law or to any collective
bargaining agreement with
<PAGE> 13
respect to such employees; (xxii) worker's compensation insurance, payroll,
social security, unemployment and other taxes with respect to such employees;
(xxiii) sales, utility and use taxes and other taxes of like import related to
services rendered or products purchased for common areas of the Building; (xxiv)
water rates and sewer rates; (xxv) all operating charges incurred by any
superintendent's and manager's offices in the operation and maintenance of the
Building; (xxvi) charges for maintenance and service contracts for all areas of
the Building; (xxvii) all other operating costs and expenses of repair,
operation and maintenance of the Building excluding fines or penalties caused by
Landlord's negligent acts or omissions; or (xxviii) the fees of the manager and
superintendent, their assistants and any clerical staff working for such
superintendent or manager whose duties are connected with the maintenance and
operation of the Building; (xxix) reasonable professional and consulting fees,
including legal and audit fees; the expenses, including payments to attorneys,
appraisers and other experts incurred by Landlord in connection with any
application or proceeding wherein Landlord obtains or seeks to obtain reduction
or refund of the Taxes payable or paid upon or against the Building; (xxx)
whether or not capitalized under generally accepted accounting principles, the
cost of repairs and the cost of replacements made in connection with repairs of
cables, fans, pumps, boilers, cooling equipment, wiring the electrical fixtures
and metering, control and distribution equipment, window washing equipment and
snow removal equipment, and component parts of the HVAC, electrical, plumbing,
elevator and any life or property protection systems (including, without
limitation, sprinkler systems); and (xxxi) managing agents' fees comparable to
those charged by other managing agents in Westchester County who manage similar
building projects, or if Landlord elects to manage (or have an affiliate manage)
the Building, an annual fee, for management of the Building, in an amount equal
to three percent (3%) of the rental revenues received by Landlord from the
Building for the Comparative Year in question.
Provided, however, that the following items shall be excluded from Building
Expenses:
(i) leasing commissions;
(ii) cost of repairs or replacements incurred by reason of
fire or other casualty (to the extent that Landlord is compensated
therefor through proceeds of insurance above deductible amounts), or
caused by the exercise of the right of eminent domain (to the extent
the same is covered by any condemnation award);
(iii) Taxes;
(iv) "Non-Building Expenses", as that term is
<PAGE> 14
hereinafter defined;
(v) costs incurred in performing work or furnishing services
to or for individual tenants (including this Tenant) at such tenant's
expense; and costs of performing work or furnishing services for
tenants other than this Tenant at Landlord's expense, to the extent
that such work or service is in excess of any work or service Landlord
is obligated to furnish to or for this Tenant at Landlord's expense;
(vi) expenditures for capital improvements other than those
that are (a) specifically included in the definition of Building
Expenses; or (b) included as Building Expenses pursuant to the
provisions of Section 4.3(a) or (b);
(vii) that portion of any cost or expense relating to the
Building and to other buildings or properties owned by Landlord, which
is properly allocable or attributable to such other buildings or
properties unless otherwise provided in this Lease;
(viii) debt service on any mortgages encumbering the Building,
or depreciation of the Building; and
(ix) the cost for those services provided to other tenants in
the Building which services are not also provided to Tenant; and
(x) any unpaid rent relating to any space in the Building.
(e) "NON-BUILDING EXPENSES" shall mean the total of public
liability insurance and all the costs and expenses incurred or borne by Landlord
in connection with the operation, maintenance, replacement and/or normal
operating repairs of the Land and "Common Areas" (as that term is hereinafter
defined) including, without limitation, the cost incurred for snow and ice
removal, grading, striping and repair of parking lot surfaces; cleaning,
exterior landscaping, and maintenance, installation, repair and replacement of
signage, traffic control devices and signs; security, ordinary maintenance,
charges for maintenance and service contracts; repair and replacement (other
than capital replacements unless specifically included herein) and improvements
which are appropriate for the operation of the Common Areas of a first class
office building project in Westchester County, New York; all normal operating
charges incurred by any superintendent's and manager's offices in the operation
and maintenance of the Common Areas; the fees of the manager and superintendent,
their assistants and any clerical staff working for such manager or
superintendent whose duties are connected with the operation and maintenance of
the Common Areas;
<PAGE> 15
whether or not capitalized under generally accepted accounting principles, the
cost of repairs and the cost of replacements made in connection with repairs of
Common Area cables, fans, pumps, boilers, cooling equipment, wiring and
electrical fixtures and metering, control and distribution equipment, component
parts of the HVAC, electrical, plumbing, elevator and any life or property
protection systems (including, without limitation, sprinkler systems), window
washing equipment and snow removal equipment;
Provided, however that the following items shall be excluded from Non-Building
Expenses:
(i) Building Expenses;
(ii) Taxes;
(iii) expenditures for capital improvements other than those
that are (a) specifically included in the definition of Non-Building
Expenses or (b) included as Non-Building Expenses pursuant to the
provisions of Sections 4.3(a) or (b);
(iv) that portion of any cost or expense relating to both the
Common Areas and to other buildings or properties owned by Landlord,
which is properly allocable or attributable to such other buildings or
properties unless otherwise provided in this Lease; and
(v) debt service on any mortgages encumbering the Common
Areas, or depreciation of any portion of the Common Areas.
(f) The term "EXPENSES" shall mean the Building Expenses and
Non-Building Expenses.
(g) Landlord represents that the definitions of "Expenses",
"Building Expenses", and "Non-Building Expenses" are substantially consistent
with the corresponding provisions of the other leases of space in the Building.
4.3 (a) If Landlord shall purchase any item of capital
equipment or make any capital expenditure designed to result in savings or
reductions in expenses, the costs for same shall be included in Expenses. If
Landlord shall lease any such item of capital equipment designed to result in
savings or reductions in Expenses, then the rentals and other costs paid
pursuant to such leasing shall be included in Expenses for the Comparative Year
in which they were incurred.
(b) If Landlord shall purchase any item of capital equipment
or make any other capital expenditure in order to comply with Legal
Requirements, then the costs for same shall be
<PAGE> 16
included in Expenses for the Comparative Year in which the costs are incurred
and subsequent Comparative Years, on a straight line basis, amortized over the
lesser of (i) fifteen (15) years, or (ii) the useful life of such items. If
Landlord shall lease any such item of capital equipment to comply with Legal
Requirements then the rentals and other costs paid pursuant to such leasing
shall be included in Expenses for the Comparative Year in which they were
incurred. If during all or part of any Comparative Year, Landlord shall not
furnish any particular item(s) of work or service (which would constitute an
element of Expense hereunder) to portions of the Building or the Common Areas
due to the fact that such portions are not occupied or leased, or because such
item of work or service is not required or desired by the tenant of such
portion, or such tenant is itself obtaining and providing such item of work or
service, or for other reasons, then, for the purposes of computing the
additional rent payable hereunder, the amount of the expenses for such item for
such period shall be deemed to be increased by an amount equal to the additional
operating and maintenance expenses which would reasonably have been incurred
during such period by Landlord if it had at its own expense furnished such item
of work or services to such portion of the Building or the Common Areas.
4.4 (a) If the Building Expenses for any Comparative Year
shall be greater than the Building Expense Base Factor, Tenant shall pay to
Landlord, as additional rent for such Comparative Year, in the manner
hereinafter provided, an amount equal to the Building Percentage of the excess
of the Building Expenses for such Comparative Year over the Building Expense
Base Factor. If the Non-Building Expenses for any Comparative Year shall be
greater than the Non-Building Expense Base Factor, Tenant shall pay to Landlord,
as additional rent for such Comparative Year, in the manner hereinafter
provided, an amount equal to the Land Percentage of the excess of the
Non-Building Expenses for such Comparative Year over the Non-Building Expense
Base Factor. The amounts payable by Tenant under this Section 4.4(a) are,
collectively, the "EXPENSE PAYMENT."
(b) (i) Following the expiration of each Comparative Year,
Landlord shall submit to Tenant an Expense Escalation Statement, certified by
Landlord, setting forth the Expenses for the preceding Comparative Year and the
Expense Payment, if any, due to Landlord from Tenant for such Comparative Year.
The rendition of such Expense Escalation Statement to Tenant shall constitute
prima facie proof of the accuracy thereof and, if such statement shows an
Expense Payment due from Tenant to Landlord with respect to the preceding
Comparative Year then (A) Tenant shall make payment of any unpaid portion
thereof within twenty (20) days after receipt of such Expense
<PAGE> 17
Escalation Statement; (B) Tenant shall also pay to Landlord, as additional rent,
within twenty (20) days after receipt of such Expense Escalation Statement, an
amount equal to (x) the product obtained by multiplying the total Expense
Payment for the preceding Comparative Year by a fraction, the denominator of
which shall be twelve (12) and the numerator of which shall be the number of
months of the current Comparative Year which shall have elapsed prior to the
first day of the month immediately following the rendition of such Expense
Escalation Statement less (y) the aggregate amount of Expense Payment paid by
Tenant for such elapsed months; and (C) Tenant shall also pay to Landlord, as
additional rent, commencing as of the first day of the month immediately
following the rendition of such Expense Escalation Statement and on the first
day of each month thereafter until a new Expense Escalation Statement is
rendered, one-twelfth (1/12) of the total Expense Payment for the preceding
Comparative Year. The aforesaid monthly payments based on the total Expense
Payment for the preceding Comparative Year shall be adjusted to reflect, as
reasonably estimated by Landlord, increases in rates and amounts, for the
current Comparative Year, applicable to the categories involved in computing
Expenses, whenever such increases become reasonably known or anticipated prior
to or during such current Comparative Year. The payments required to be made
under clauses (B) and (C) of this subsection 4.4(b). shall be credited toward
the Expense Payment due from Tenant for the then-current Comparative Year,
subject to adjustment as and when the Expense Escalation Statement for such
current Comparative Year is rendered by Landlord.
(ii) The Expense Escalation Statement to be furnished by
Landlord shall constitute a final determination as between Landlord and Tenant
of the Expenses for the periods represented thereby, unless Tenant shall have
paid the Expense Payment and, within sixty (60) days after it is furnished,
shall give a notice to Landlord that it disputes its accuracy or its
appropriateness, which notice shall specify the particular respects in which the
Expense Escalation Statement is inaccurate. Pending the resolution of such
dispute, Tenant shall pay the additional rent to Landlord in accordance with the
Expense Escalation Statements furnished by Landlord. After payment of said
additional rent, Tenant's certified public accountant shall have the right,
during reasonable business hours and upon not less than five (5) business days'
prior written notice to Landlord, to examine Landlord's books and records with
respect to the foregoing (which Landlord shall maintain in either Westchester
County or New York County for three (3) years subsequent to the Escalation Year
to which they relate) and, at Tenant's expense, to make copies thereof, provided
such examination is commenced within sixty (60) days and concluded within one
hundred twenty (120) days following the rendition of the Expense Escalation
Statement in question. Landlord shall cooperate with Tenant in any such
examination of its books and records and shall, if requested by Tenant in
writing, make a member of its staff available to explain any entries in such
<PAGE> 18
books and records.
(iii) Any such dispute as to an Expense Escalation Statement
referred to in subsection 4.4(b)(i) hereof shall be resolved by arbitration in
accordance with the Commercial Arbitration Rules of the American Arbitration
Association, except that the arbitration shall be by three (3) arbitrators each
of whom shall be a certified public accountant. Except as hereinafter provided
in this paragraph, the cost of such arbitration shall be split equally between
Landlord and Tenant. If the arbitrators decide that the Expense Payment shown on
the Expense Escalation Statement was overstated by more than ten percent (10%),
then Landlord shall pay the cost of such arbitration. If the arbitrators decide
that the Expense Payment shown on the Expense Escalation Statement was
understated by more than ten percent (10%), then Tenant shall pay the cost of
such arbitration.
4.5 In no event shall the fixed annual rent under this Lease
be reduced by virtue of this Article.
4.6 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 cause an Expense Escalation Statement of the
Expenses for that Comparative Year to be prepared and furnished to Tenant.
Landlord and Tenant shall thereupon make appropriate adjustments of amounts then
owing.
4.7 Landlord's and Tenant's obligation to make the adjustments
referred to in Section 4.6 hereof shall survive any expiration or termination of
this Lease.
4.8 Any delay or failure of Landlord in billing any Expense
Payment hereinabove or hereinafter provided shall not constitute a waiver of or
in any way impair the continuing obligation of Tenant to pay such expense
escalation hereunder.
4.9 Landlord and Tenant agree that in the event of any
overpayment or underpayment of any Expense Payment, the amount of any excess to
be credited to Tenant, or the amount of any deficiency to be paid by Tenant
shall be credited or paid with interest thereon computed at the Interest Rate
from the date such deficiency was due, or such overpayment was made until,
respectively, the date paid or credited.
<PAGE> 19
4.10 Tenant acknowledges that the Building Project includes
Building A/B, Building C and Building D. If the operation of Building A/B and/or
Building C is combined with the operation of the D Building, so that Building
Expenses include such items with respect to all of such buildings, (a) the
"BUILDING PERCENTAGE" (for the purposes of this Article 4, only) shall be
reduced to reflect the percentage which the rentable square foot area of the
demised premises bears to the total rentable square foot area of the Building
and such included building(s), and (b) the Building Expense Base Factor shall be
increased to reflect the amount of Building Expenses incurred for calendar year
2001 for the Building and such included building(s).
ARTICLE 5
USE
5.1 The demised premises shall be used solely as and for
executive and general offices and for no other purpose.
5.2 Tenant shall not use or permit the use of the demised
premises or any part thereof in any way which would violate any of the
covenants, agreements, terms, provisions and conditions of this Lease or for any
unlawful purposes or in any unlawful manner or in violation of the certificate
of occupancy or other certificate or permit for the demised premises or the
Building, and Tenant shall not suffer or permit the demised premises or any part
thereof to be used in any manner or anything to be done therein or anything to
be brought into or kept therein which, in the reasonable judgment of Landlord,
shall in any way impair or tend to impair the character, reputation or
appearance of the Building as a high quality office building, impair or
interfere with or tend to impair or interfere with any of the Building services
or the proper and economic heating, cleaning, air conditioning or other
servicing of the Building or the demised premises, or impair or interfere with
or tend to impair or interfere with the use of any of the other areas of the
Building by, or occasion discomfort, inconvenience or annoyance to, any of the
other tenants or occupants of the Building.
5.3 If Tenant uses any portion of the demised premises for the
preparation or consumption of food, Tenant shall pay to Landlord the cost of
employing, on a regular basis, an exterminator to keep the demised premises free
from vermin. Tenant shall cause all food preparation areas to be properly
ventilated so that no odor shall emanate from the demised premises to any other
portion of the Building, and shall bag all wet garbage and place the same in
containers that prevent the
<PAGE> 20
escape of odor.
5.4 Tenant shall have access to the demised premises on a
24-hour basis, 7 days per week.
ARTICLE 6
ALTERATIONS AND INSTALLATIONS
6.1 Tenant shall make no alterations, installations, additions
or improvements (such work hereinafter collectively referred to as
"ALTERATIONS") in or to the demised premises without Landlord's prior written
consent and then only by contractors or mechanics first approved by Landlord.
All Alterations shall be done at Tenant's sole cost and expense, and at such
times and in such manner as Landlord may from time to time reasonably designate.
Tenant may from time to time during the term of this lease, at
its expense, make non-structural cosmetic changes, which cost less than
Twenty-Five Thousand 00/100 Dollars ($25,000.00), without Landlord's prior
consent.
Tenant shall obtain and deliver to Landlord written,
unconditional waivers of mechanic's or other liens on the real property in which
the demised premises are located, signed by all architects, engineers,
contractors, mechanics and designers involved in such Alterations as and when
such architects, engineers, contractors, mechanics and designers are paid for
their work in connection therewith.
Any Alterations in the demised premises shall be effected
solely in accordance with the plans and specifications approved by Landlord.
Tenant shall reimburse Landlord promptly upon demand for any reasonable
out-of-pocket costs and expenses incurred by Landlord in connection with
Landlord's review of such Tenant's plans and specifications. Landlord will not
unreasonably withhold or delay its consent for nonstructural Alterations
(provided they will not affect the outside of the Building or the demised
premises or adversely affect the Building's structure, electrical, HVAC,
plumbing, mechanical or other systems). Prior to granting its consent to
Alterations, Landlord may impose such conditions as to guarantee of completion
and payment and of restoration as Landlord may reasonably consider desirable.
Any such approved Alterations shall be performed in accordance
with the foregoing and the following provisions of this Article 6:
<PAGE> 21
(a) All Alterations shall be done in a professional and
workmanlike manner.
(b) (i) In the event Tenant shall employ any contractor to do
in the demised premises any Alterations permitted by this Lease, such contractor
and any subcontractor shall agree to employ only such labor as will not result
in jurisdictional disputes or strikes or result in causing disharmony with other
workers employed at the Building. Tenant will inform Landlord in writing of the
names of any contractor or subcontractor Tenant proposes to use in the demised
premises at least ten (10) days prior to the beginning of work by such
contractor or subcontractor, but such information given to Landlord shall in no
way constitute Landlord's approval of such contractor or subcontractor.
(ii) Tenant covenants and agrees to pay to its
contractor(s), as the work progresses, the entire cost (less a reasonable
retainage) of supplying the materials and performing the work shown on Tenant's
approved plans and specifications in accordance with Tenant's contract or
contracts with such contractor(s).
(c) All such Alterations shall be effected in compliance with
all applicable laws, ordinances, rules and regulations of governmental bodies
having or asserting jurisdiction in the demised premises and all applicable
insurance rules and regulations.
(d) Tenant shall keep the Building Project 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 on Tenant's behalf, and all
work to be performed by Tenant shall be done in a manner which will not
unreasonably interfere with or disturb other tenants or occupants of the
Building.
(e) During the progress of the work to be done by Tenant, said
work shall be subject to inspection by representatives of Landlord which, upon
reasonable notice, shall be permitted access and the opportunity to inspect, at
all reasonable times, but this provision shall not in any way whatsoever create
any obligation on Landlord to conduct such an inspection or create any
obligations or liability (or relieve Tenant of any obligations under this Lease)
in the event Landlord does conduct such an inspection.
(f) Prior to commencement of any work, Tenant or Tenant's
contractors shall furnish to Landlord certificates evidencing the existence of:
(i) worker's compensation insurance covering all
<PAGE> 22
persons employed for such work; and
(ii) contractor's comprehensive general liability and
property damage insurance naming Landlord, any of its mortgagees and
ground lessors and Tenant as insureds, with coverage of at least
$3,000,000 combined single limit.
6.2 Any mechanic's lien, filed against the demised premises or
the Building or the Building Project for work claimed to have been done for or
materials claimed to have been furnished to Tenant shall be discharged by Tenant
at its expense within thirty (30) days after notice of such filing, by payment,
filing of the bond required by law or otherwise. Notice is hereby given that
Landlord shall not be liable for any labor or materials furnished or to be
furnished to Tenant upon credit, and that no mechanic's or other lien for any
such labor or materials shall attach to or affect the reversion or other estate
or interest of Landlord in and to the demised premises.
6.3 All work, installations and improvements made and
installed by solely Landlord shall be the property of Landlord and shall remain
upon and be surrendered with the demised premises as a part thereof at the end
of the term of this Lease.
6.4 All Alterations, made and installed by Tenant, or at
Tenant's expense, upon or in the demised premises shall become and be the
property of Landlord, and shall remain upon and be surrendered with the demised
premises as a part thereof at the end of the term of this Lease. Notwithstanding
the foregoing, Tenant shall remove all Alterations which in Landlord's
reasonable judgment are of a non-Building Standard nature, such as internal
stairways, slab openings, special electronic data processing or communications
installations, vaults and raised floors, at or before the Expiration Date or
within fifteen (15) business days after any earlier termination date, and Tenant
shall repair or pay the cost of repairing any damage to the demised premises or
Building resulting from the removal thereof and restoring the demised premises
to their condition prior to the installation thereof unless at the time of
installation, Tenant shall have requested and obtained Landlord's waiver or the
removal of such Alterations.
6.5 Where furnished by or at the expense of Tenant all
furniture, furnishings and trade fixtures, including, without limitation,
murals, business machines and equipment, telecommunications equipment and
cabling, counters, screens, grille work, special paneled doors, cages,
partitions, metal railings, closets, panelling, lighting fixtures and equipment,
drinking fountains, refrigeration and air handling equipment, and any other
movable property shall remain the property of Tenant which may at its option
remove all or any part thereof at any time prior to the expiration of the term
of this Lease.
<PAGE> 23
6.6 If any Alterations or other property which Tenant shall
have the right to remove or be requested by Landlord to remove as provided in
Article 6.4 or 6.5 hereof (hereinafter called "TENANT'S PROPERTY") are not
removed on or prior to the expiration of the term of this Lease, Landlord shall
have the right to remove Tenant's Property and to dispose of the same without
accountability to Tenant and at the sole cost and expense of Tenant. Landlord
shall endeavor to give notice to Tenant that Tenant may remove such Tenant's
Property within five (5) days of the date stated therein; provided that
Landlord's failure to give such notice shall not give rise to any claim against
or liability on Landlord's part. In case of any damage to the demised premises
or Building resulting from the removal of Tenant's property, Tenant shall repair
such damage or, in default thereof, shall reimburse Landlord for Landlord's cost
in repairing such damage. This obligation shall survive any termination of this
Lease.
6.7 Tenant shall keep records of Tenant's Alterations costing
in excess of $50,000, and of the cost thereof for a period of five (5) years
after the completion thereof. Tenant shall, within forty-five (45) days after
demand by Landlord, furnish to Landlord copies of such records and cost if
Landlord shall require the same in connection with any proceeding to reduce the
assessed valuation of the A/B Building, Building C or Building D or any other
tax or charge, or in connection with any proceeding instituted pursuant to
Articles 13 or 14 hereof.
ARTICLE 7
REPAIRS
7.1 Tenant shall, at its sole cost and expense, make such
repairs to the demised premises and the fixtures and appurtenances therein as
are necessitated by the reckless or negligent acts or omissions of Tenant or by
the use of the demised premises in a manner contrary to the purposes for which
same are leased to Tenant as set forth in Section 5.1, as and when needed to
preserve them in good working order and condition subject to normal wear and
tear and damage by fire or other casualty. All damage or injury to the demised
premises and to its fixtures, appurtenances and equipment or to the Building or
to its fixtures, appurtenances and equipment caused by Tenant moving property in
or out of Building or by installation or removal of furniture, fixtures or other
property by or on behalf of Tenant, shall be repaired, restored or replaced
promptly by Tenant at its sole cost and expense, which repairs, restorations and
replacements shall be in quality and class equal to the original work or
installations. If Tenant fails to make such
<PAGE> 24
repairs, restoration or replacements, within ten (10) days after Landlord gives
Tenant written notice of the necessity thereof, the same may be made by Landlord
at the expense of Tenant and such expense shall be collectible as additional
rent and shall be paid by Tenant within thirty (30) days after rendition of a
bill therefor.
The exterior walls of the Building, the portions of any
windowsills outside the windows, and the windows are not part of the premises
demised by this Lease and Landlord reserves all rights to such parts of the
Building.
7.2 Tenant shall not place a load upon any floor of the
demised premises exceeding fifty (50) pounds per useable square foot live load,
and if Tenant shall desire a floor load in excess of such floor load, Landlord
agrees to strengthen and reinforce the same so as to give the live load desired,
provided, (i) Tenant shall submit to Landlord the plans showing the locations of
and the desired floor live load for the areas in question, (ii) Tenant shall
agree to pay for or reimburse Landlord on demand for the cost of such
strengthening and reinforcement as well as any other costs to and expenses of
Landlord occasioned by or resulting from such strengthening or reinforcement,
(iii) Landlord's architects, in their sole reasonable discretion, find that the
work necessary to increase such floor load does not adversely affect the
structure of the Building and (iv) such work will not interfere with the amount
or availability of any space adjoining alongside, above or below the demised
premises, or interfere with the occupancy of other tenants in the Building.
7.3 Landlord shall exercise reasonable diligence in the making
of any repairs, alterations, additions or improvements so as to minimize any
interference with Tenant's business operations, but shall not be required to
perform the same on an overtime or premium pay basis.
7.4 Landlord shall, at its expense (subject to the provisions
of Section 7.1 hereof and to reimbursement as set forth in Article 4 hereof)
keep and maintain the Common Areas and the Building in good condition and repair
in accordance with the standards appropriate to a first class office building in
Westchester County, New York, and make all repairs, structural and otherwise,
interior and exterior, as and when needed in or about the demised premises,
except for those repairs for which Tenant is responsible pursuant to the
provisions of this Lease.
ARTICLE 8
REQUIREMENTS OF LAW
<PAGE> 25
8.1 Tenant, at Tenant's cost and expense, shall comply with
all Legal Requirements (as defined in Section 22.4) which result from Tenant's
manner or use or occupation of the demised premises. Landlord represents that,
as of the date hereof, the demised premises are in substantial compliance with
all Legal Requirements and Tenant's use as set forth in Section 5.1 is permitted
under the current Certificate of Occupancy for the Building.
8.2 Notwithstanding the provisions of Section 8.1 hereof,
Tenant, at its own cost and expense, in its name may contest, in any manner
permitted by law (including appeals to a court, or governmental department or
authority having jurisdiction in the matter), the validity or the enforcement of
any governmental act, regulation or directive with which Tenant is required to
comply pursuant to this Lease, and may defer compliance therewith provided that:
(a) such non-compliance shall not subject Landlord to criminal
or civil prosecution or subject the Land and/or the Building Project to lien or
sale;
(b) such non-compliance shall not be in violation of any fee
mortgage, or of any ground or underlying lease or any mortgage thereon;
(c) Tenant shall first deliver to Landlord a surety bond (in
such sum as Landlord may reasonably request) issued by a surety company of
recognized responsibility, or other security satisfactory to Landlord,
indemnifying and protecting Landlord against any loss or injury by reason of
such non-compliance; and
(d) Tenant shall promptly and diligently prosecute such
contest.
Landlord, without expense or liability to it, shall cooperate
with Tenant and execute any documents or pleadings required for such purpose,
provided that Landlord shall reasonably be satisfied that the facts set forth in
any such documents or pleadings are accurate.
ARTICLE 9
INSURANCE, LOSS, REIMBURSEMENT, LIABILITY
9.1 Tenant shall not knowingly or intentionally violate, or
permit the violation of, any condition imposed by any insurance policy then
issued in respect to the Building Project and/or the property therein and shall
not do, or permit anything to be done, or keep or permit anything to be kept in
the demised
<PAGE> 26
premises which would subject Landlord to any liability or responsibility for
bodily injury or death or property damage, or which would increase any insurance
rate in respect to the Building Project or the property therein over the rate
which would otherwise then be in effect or which would result in insurance
companies of good standing refusing to insure the Building Project or the
property therein in amounts reasonably satisfactory to Landlord, or which would
result in the cancellation of or the assertion of any defense by the insurer in
whole or in part to claims under any policy of insurance in respect of the
Building Project or the property therein, but nothing contained in this Section
9.1 shall be construed to restrict Tenant's use of the demised premises for the
purposes permitted under Article 5 hereof.
9.2 If, by reason of any failure of Tenant to comply with the
provisions of Section 8.1 or Section 9.1, the premiums on Landlord's insurance
on the Building Project and/or equipment or property therein shall be higher
than they otherwise would be, Tenant shall reimburse Landlord, on demand, for
that part of such premiums attributable to such failure on the part of Tenant. A
schedule or "make up" of rates for the Building Project issued by the applicable
fire insurance rating organization or other similar body making rates for
insurance for the Building Project shall be conclusive evidence of the facts
therein stated and of the several items and charges in the insurance rate then
applicable to the Building Project.
9.3 Tenant, at its expense, shall maintain at all times during
the term of this Lease (a) "all risk" property insurance covering Tenant's
property and improvements and betterments to a limit of not less than 100% of
the replacement cost thereof and (b) comprehensive general liability insurance,
including contractual liability, in respect of the demised premises and the
conduct or operation of business therein, with Landlord and its managing agent,
if any, and any lessor of any ground or underlying lease or the holder of any
mortgage, as the case may be, whose name and address shall have been furnished
to Tenant, as additional insureds, with limits of not less than $3,000,000
combined single limit bodily injury and property damage liability. Landlord
hereby agrees that the comprehensive general liability insurance requirement
described in clause (b) of the preceding sentence may be satisfied through the
use of umbrella coverage, which umbrella coverage must be evidenced by a policy
of insurance satisfactory to Landlord. The limits of such insurance shall not
limit the liability of Tenant hereunder. Tenant shall deliver to Landlord and
any additional insureds such fully paid-for policies and certificates of
insurance in form satisfactory to Landlord issued by the insurance company or
its authorized agent, at least ten (10) days before the Commencement Date.
Tenant shall procure and pay for renewals of such insurance from time to time
before the expiration thereof, and
<PAGE> 27
Tenant shall deliver to Landlord and any additional insureds such renewal policy
and certificates of coverage at least thirty (30) days before the expiration of
any existing policy. All such policies shall be issued by companies reasonably
acceptable to Landlord. If Landlord is included as a named payee on any check
issued by Tenant's insurer in payment of any claim solely with respect to
Tenant's property, Landlord agrees that it will promptly upon Tenant's request
endorse such check to Tenant. Landlord further agrees that it shall have no
right or authority to participate in any settlement of any claim by Tenant
against its insurer which relates solely to damage or loss to Tenant's property.
9.4 Each party agrees to have included in each of its
insurance policies a waiver of the insurer's right of subrogation against the
other party (and in the case of Tenant against other tenants of the Building)
during the term of this Lease or, if such waiver should be unobtainable or
unenforceable, (i) an express agreement that such policy shall not be
invalidated if the insured waives the right of recovery against any party
responsible for a casualty covered by the policy before the casualty, or (ii)
any other form of permission for the release of the other party reasonably
satisfactory to the party intended to be released. If such waiver, agreement or
permission shall not be, or shall cease to be, obtainable from either party's
then current insurance company, the insured party shall so notify the other
party promptly after learning thereof, and shall use its commercially reasonable
efforts to obtain the same from another insurance company (if the insured party
is Tenant, an insurance company described in Section 9.3 hereof). Each party
hereby releases the other party (and in the case of Tenant, other tenants of
Building who shall have executed a similar waiver or agreement as set forth in
this Section 9.4) with respect to any claim (including a claim for negligence)
which it might otherwise have against the other party, for loss, damage or
destruction with respect to its property occurring during the term of this Lease
to the extent to which it is required pursuant to the terms hereof, to be
insured under a policy or policies containing a waiver of subrogation, agreement
or permission to release liability, as provided in the preceding subdivisions of
this section. If, notwithstanding the recovery of insurance proceeds by either
party for loss, damage or destruction of its property, the other party is liable
to the first party with respect thereto or is obligated under this Lease to make
replacement, repair or restoration or payment, then, provided the first party's
right of full recovery under its insurance policies is not thereby prejudiced or
otherwise adversely affected, the amount of the net proceeds of the first
party's insurance against such loss, damage or destruction shall be offset
against the second party's liability to the first party therefor, or shall be
made available to the second party to pay for replacement, repair or
restoration, as the case may be. Nothing contained in this
<PAGE> 28
section shall be deemed to relieve either party of any duty imposed elsewhere in
this Lease to repair, restore or rebuild provided for elsewhere in this Lease.
9.5 Landlord may from time to time, but not more frequently
than once every three (3) years, require that the amount of comprehensive
general liability insurance to be maintained by Tenant under Section 9.3 or
Section 6.1(f) be reasonably increased.
9.6 Landlord or its agents shall not be liable for any injury
or damage to persons or property resulting from fire, explosion, falling
plaster, steam, gas, electricity, water, rain or snow or leaks from any part of
the Building Project, or from the pipes, appliances or plumbing works or from
the roof, street or subsurface or from any other place or by dampness or by any
other cause of whatsoever nature, unless any of the foregoing shall be caused by
or due to the negligence of Landlord.
9.7 Landlord or its agents shall not be liable for any damage
which Tenant may sustain if at any time any window of the demised premises is
temporarily closed, darkened or bricked up for any reason whatsoever, or
permanently closed, darkened or bricked up to comply with Legal Requirements or
the requirements of Landlord's insurers, and Tenant shall not be entitled to any
compensation therefor or abatement of rent or to any release from any of
Tenant's obligations under this Lease, nor shall the same constitute an
eviction.
9.8 Each party agrees to give the other party notice in case
of fire or accidents in the demised premises promptly after such party becomes
aware of such event.
ARTICLE 10
LANDLORD'S LIABILITY
10.1 Tenant agrees to look solely to Landlord's estate and
interest in the Building, or the proceeds from the sale thereof for the
satisfaction of any right or remedy of Tenant for the collection of a judgment
(or other judicial process) requiring the payment of money by Landlord, in the
event of any liability by Landlord hereunder, and no other property or assets of
Landlord shall be subject to levy, execution, attachment, 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 demised premises, or any other liability of Landlord to
Tenant hereunder. Neither the partners constituting Landlord (the "PARTNERS"),
nor the partners, shareholders, directors or
<PAGE> 29
officers of Landlord or the Partners shall be liable for the performance of
Landlord's obligations under this Lease.
ARTICLE 11
ASSIGNMENT, MORTGAGING, SUBLETTING, ETC.
11.1 Subject to the provisions of Section 11.2 hereof Tenant
shall not (a) assign or otherwise transfer this Lease or any interest herein, or
the term and estate hereby granted, (b) sublet the demised premises or any part
thereof or allow the same to be used or occupied by others, (c) mortgage, pledge
or encumber this Lease or the demised premises or any part thereof in any manner
by reason of any act or omission on the part of Tenant, or (d) advertise, or
authorize a broker to advertise, for a subtenant or an assignee at a
consideration or at rental rates below the rental rates then being advertised by
Landlord as its rental rates for comparable space in the Building Project and
for a comparable term, without, in each instance, obtaining the prior written
consent of Landlord, except as otherwise expressly provided in this Article 11.
For purposes of this Article 11, (i) the transfer of a majority of the issued
and outstanding capital stock of any corporate tenant, or of a corporate
subtenant, or the transfer of a majority of the total interest in any
partnership, limited liability company or other entity that is the Tenant or a
subtenant, however accomplished, whether in a single transaction or in a series
of related or unrelated transactions, shall be deemed an assignment of this
Lease, or of such sublease, as the case may be, and (ii) a takeover agreement
shall be deemed a transfer of this Lease.
11.2 The consent of Landlord shall not be required for (but
the provisions of Section 11.5(d) hereof shall be applicable to) an assignment
or sublease of all or any portion of the demised premises to (i) a corporation
into or with which Tenant is merged or consolidated, (ii) an entity to which
substantially all of Tenant's shares or assets are transferred or, (iii) if
Tenant is a partnership, a successor partnership, provided that any such merger,
consolidation, transfer or other transaction is not principally for the purpose
of transferring the leasehold estate created hereby, and provided further, that
the assignee, successor or subtenant, as applicable, has a net worth at least
equal to or in excess of the net worth of Tenant immediately prior to the
transaction in question. The provisions of clauses (a) and (b) of Section 11.1
shall not apply to transactions with an entity (hereinafter called an
"AFFILIATE") which controls or is controlled by Tenant or is under common
control with Tenant during the period it remains an Affiliate. Furthermore, an
Affiliate of Tenant shall be permitted to occupy the demised premises but only
during such period as it shall
<PAGE> 30
remain an Affiliate. For the purposes of the foregoing "control" shall mean
ownership of 50% or more of the stock, partnership interests or other equity
interests in the entity.
11.3 Any assignment or transfer, whether made with Landlord's
consent as required by Section 11.1 or without Landlord's consent pursuant to
Section 11.2, shall not be effective hereunder until, the assignee shall
execute, acknowledge and deliver to Landlord a recordable agreement, in form and
substance reasonably satisfactory to Landlord, whereby the assignee shall assume
the obligations and performance of this Lease from and after the date of such
assignment and agree to be personally bound by and upon all of the covenants,
agreements, terms, provisions and conditions hereof on the part of Tenant to be
performed or observed and whereby the assignee shall agree that the provisions
of Section 11.1 hereof shall, notwithstanding any further assignment or
transfer, continue to be binding upon it in the future. Tenant covenants that,
notwithstanding any assignment or transfer, whether or not in violation of the
provisions of this Lease, and notwithstanding the acceptance of fixed annual
rent by Landlord from an assignee or transferee or any other party, Tenant shall
remain fully and primarily liable for the payment of the fixed annual rent and
additional rent due and to become due under this Lease and for the performance
of all of the covenants, agreements, terms, provisions and conditions of this
Lease on the part of Tenant to be performed or observed.
11.4 (a) Except for an assignment or sublease pursuant to
Section 11.2 hereof, if Tenant agrees to enter into an assignment of this Lease
or a sublease to sublet the demised premises or any portion thereof, Tenant
shall, as soon as that agreement is consummated, but no less than sixty (60)
days prior to the effective date of the contemplated assignment or sublease,
deliver to Landlord an executed counterpart of the proposed assignment or
sublease, and Landlord shall then have the right to elect, by notifying Tenant
within thirty (30) days of such delivery, to (i) in the case of an assignment of
this Lease, to terminate this Lease or to accept an assignment of this Lease
from Tenant, and Tenant shall then promptly execute and deliver to Landlord or
entity affiliated with Landlord, in form reasonably satisfactory to Landlord's
counsel, an assignment on the terms reflected in the proposed assignment, which
assignment shall be effective as of such effective date and shall relieve Tenant
of further liability accruing under this Lease after such effective date as to
such portion of the demised premises assigned to Landlord or entity affiliated
with Landlord, and (ii) in the case of a proposed subletting, to terminate this
Lease, with respect to the portion of the demised premises affected by any such
proposed subletting or the entire demised premises in the case of a proposed
subletting thereof or to accept a sublease from Tenant thereof, and Tenant shall
then promptly execute and deliver a sublease to Landlord or entity affiliated
with
<PAGE> 31
Landlord, for the duration of Tenant's proposed subletting, commencing with such
effective date, at the rental terms reflected in the proposed sublease. If an
offer of sublease to Landlord results in all or substantially all of the demised
premises being sublet for substantially all of the term of this Lease (i.e., the
balance of the term less one year or less), then Landlord shall have the option
to extend the term of the sublease being offered to it for the remainder of the
term of this Lease less one day.
(b) If Landlord should elect to have Tenant execute and
deliver a sublease pursuant to any of the provisions of this Section 11.4, said
sublease shall be in a form reasonably satisfactory to Landlord's counsel and on
all the terms contained in this Lease, except that:
(i) The rental terms shall be as provided in
subsection 11.4(a) hereof,
(ii) The sublease shall not provide for any work to be done
for the subtenant or for any initial rent concessions or contain
provisions inapplicable to a sublease, except that in the case of a
subletting of a portion of the demised premises, Tenant shall reimburse
subtenant for the cost of erecting such demising walls as are necessary
to separate the subleased premises from the remainder of the demised
premises and to provide access and building services thereto, provided
Tenant was obligated to perform such work or reimburse the proposed
subtenant for such work under the terms of the proposed sublease,
(iii) The subtenant thereunder shall have the right to
underlet the subleased premises, in whole or in part, without Tenant's
consent,
(iv) The subtenant thereunder shall have the right to make,
or cause to be made, any changes, alterations, decorations, additions
and improvements that such subtenant may desire or authorize,
(v) Such sublease shall expressly negate any intention
that any estate created by or under such sublease be merged with any
other estate held by either of the parties thereto,
(vi) Any consent required of Tenant, as lessor under that
sublease, shall be deemed granted if consent with respect thereto is
granted by Landlord,
(vii) The use of the sublet premises by the subtenant shall
be for general, administrative and/or executive offices unless
constructed for another purpose by
<PAGE> 32
or for Tenant in which event Landlord may in addition use it for such
purpose,
(viii) Any failure of the subtenant thereunder to comply with
the provisions of said sublease, other than with respect to the payment
of rent to Tenant, shall not constitute a default thereunder or
hereunder if Landlord has consented to such non-compliance, unless such
failure to comply would cause a violation of law or would increase or
extend the liability of Tenant under this Lease,
(ix) Upon execution of such sublease, Tenant's obligations
with respect to vacating the demised premises and removing any changes,
alterations, decorations, additions or improvements made in the
subleased premises shall be limited to those which accrued and related
to such as were made prior to the effective date of the sublease, and
(x) Such sublease shall provide that at the expiration of
the term of such subletting Tenant will accept the space in the
condition provided for in the proposed sublease.
If Landlord should elect to have Tenant execute and deliver a
sublease pursuant to any of the provisions of this Section 11.4, Tenant shall be
excused from having to obtain Landlord's consent, as required by the terms of
this Lease, for changes, alterations, decorations, additions or improvements
desired by the subtenant.
(c) If pursuant to the exercise of any of Landlord's options
pursuant to this Section 11.4 hereof this Lease is terminated as to only a
portion of the demised premises, then the fixed annual rent payable hereunder
and the additional rent payable pursuant to Articles 3 and 4 hereof shall be
adjusted in proportion to the portion of the demised premises affected by such
termination.
11.5 In the event that Landlord does not exercise the option
available to it pursuant to subsection 11.4(a) hereof, Landlord shall not
unreasonably withhold or delay its consent to an assignment of this Lease or a
proposed subletting of the demised premises, as the case may be, by Tenant,
provided:
(a) Tenant shall have furnished Landlord with the name and
business address of the proposed subtenant or assignee, information with respect
to its intended use of the demised premises and the nature and character of the
proposed subtenant's or assignee's business, or activities, and, if Tenant is no
longer the actual tenant of the demised premises, such reasonable references and
current financial information with respect to net
<PAGE> 33
worth, credit and financial responsibility as are reasonably satisfactory to
Landlord, and an executed counterpart of the sublease or assignment agreement;
(b) the proposed subtenant or assignee is a reputable party
whose financial net worth, credit and financial responsibility is, considering
the responsibilities involved, satisfactory to Landlord;
(c) the proposed subtenant or assignee is not then an occupant
of any part of the Building Project or a party who is dealing with Landlord or
Landlord's agent (directly or through a broker) with respect to space then
available (or becoming available) in the Building Project; and
(d) each sublease shall specifically state that (i) it is
subject to all of the terms, covenants, agreements, provisions, and conditions
of this Lease, and (ii) the subtenant or assignee, as the case may be, will not
have the right to a further assignment thereof or sublease or assignment
thereunder, or to allow the demised premises to be used by others, without the
prior reasonable consent of Landlord in each instance.
11.6 If Tenant defaults in the payment of any rent, Landlord
is authorized to collect any rents due or accruing from any assignee, subtenant
or other occupant of the demised premises and to apply the net amounts collected
to the fixed annual rent and additional rent reserved herein. The receipt by
Landlord of any amounts from an assignee or subtenant, or other occupant of any
part of the demised premises shall not be deemed or construed as releasing
Tenant from Tenant's obligations hereunder or the acceptance of that party as a
direct tenant.
ARTICLE 12
ELECTRICITY
12.1 (a) Landlord shall supply electricity to the demised
premises in accordance with the provisions of this Section 12.1. For the
purposes of this Section 12.1, Landlord and Tenant agree that the term "COST PER
KILOWATT HOUR" shall mean the total cost for electricity incurred by Landlord to
service the demised premises, as measured by the meter servicing that portion of
the Building in which the demised premises are located, during a particular time
period (including all applicable surcharges, demand charges, energy charges,
fuel adjustment charges, time of day charges, taxes and other sums payable in
respect thereof) divided by the total kilowatt hours purchased by Landlord
during such period.
<PAGE> 34
(b) Electricity shall be supplied by Landlord to service the
demised premises and Tenant shall pay to Landlord, as additional rent, an amount
determined by applying the Cost per Kilowatt hour to Tenant's consumption of and
demand for electricity within the demised premises as recorded on the submeter
or submeters servicing the demised premises. Where more than one meter measures
the electric service to Tenant, the electric service rendered through each meter
shall be computed and billed separately in accordance with the provisions
hereinafter set forth. Bills for the electricity additional rent shall be
rendered to Tenant at such time as Landlord may elect. If any tax is imposed
upon Landlord's receipts from the sale of electricity to Tenant by Federal,
State or municipal authority, Tenant agrees that, unless prohibited by law,
Tenant's proportionate share of such taxes shall be included in the bill of, and
paid by Tenant to, Landlord, as additional rent. Landlord's failure during the
term of this Lease to prepare and deliver any statements or bills under this
Article 12, or Landlord's failure to make a demand under this Article 12, or any
other provisions of this Lease shall not in any way be deemed to be a waiver of,
or cause Landlord to forfeit or surrender its rights to collect, any amount of
additional rent which may have become due pursuant to this Article 12 during the
term of this Lease. The costs incurred by Landlord for meter readings for those
meters and sub-meters that measure the electric service supplied to Tenant, and
the costs incurred by Landlord in the maintenance of such meters and sub-meters,
shall be paid by Tenant on demand, as additional rent. Tenant's liability for
any amounts due under this Article 12 shall survive the expiration or sooner
termination of this Lease.
12.2 Notwithstanding the provisions of Section 12.1 above, at
Landlord's option, Tenant shall, within sixty (60) days after receiving notice
from Landlord (or any shorter period as may be required by applicable legal
requirements), contract directly with the public utility furnishing electric
current to the Building for the supply, at Tenant's cost, of all electric
current to be used in the demised premises including, without limitation, such
as is required for the operation of any supplemental heating, ventilating and
air-conditioning system serving the demised premises except that which is used
in the operation of the "HVAC SYSTEM" (as that term is hereinafter defined in
Section 21.1).
12.3 Tenant's use of electric current in the demised premises
shall not at any time exceed the capacity of any of the electrical conductors
and equipment in or otherwise serving the demised premises. Tenant shall not
make or perform, or permit the making or performing of, any alterations to
wiring, installations or other electrical facilities in or serving the demised
premises without the prior consent of the Landlord in each instance. Should
Landlord grant any such consent, all
<PAGE> 35
additional risers or other equipment required therefor shall be installed by
Landlord (after advising Tenant of the estimated cost thereof and provided
Tenant elects to have Landlord proceed with such work) and the cost thereof
shall be paid by Tenant upon Landlord's demand, at which time Landlord shall
provide Tenant with documentation in regard to such costs, which such costs
shall not exceed what would be paid in an arm's-length transaction and any such
alterations shall be made in accordance with Article 6 thereof.
12.4 Landlord shall not be liable in any way to Tenant for any
failure or defect in the supply or character of electric energy furnished to the
demised premises by reason of any requirement, act or omission of the public
utility serving the Building with electricity or for any other reason and not
attributable to Landlord's negligence.
12.5 If, at any time during the term of this Lease, Tenant
wishes to install in the demised premises equipment which would not be
considered ordinary office equipment, including, but not limited to, items such
as computer installation or supplemental air conditioning systems, or other heat
or cooling-intensive electrically operated equipment, Tenant shall submit to
Landlord a list indicating the specific type of additional equipment to be
installed. Such list shall include the number, type and model of each item of
equipment to be installed, as well as the manufacturer's electrical rating
associated with same. If, in Landlord's reasonable judgment the operation of
such equipment will impair the proper operation of the plumbing, heating,
ventilation, air conditioning or other systems for the Building, Tenant shall
not be permitted to make such installation, provided that Landlord, in its sole
discretion, may permit Tenant to make such installation if as a condition to the
installation of such equipment, Tenant shall reimburse Landlord for Landlord's
additional cost incurred, as a result of such equipment installation and
operation, in connection with the proper function of such systems.
ARTICLE 13
DAMAGE BY FIRE OR OTHER CAUSE
13.1 If the Building or the demised premises shall be
partially or totally damaged or destroyed by fire or other cause, within
forty-five (45) days after Landlord acquires knowledge of such damage, Landlord
shall deliver to Tenant an estimate prepared by a reputable contractor selected
by Landlord setting forth such contractor's estimate as to the reasonable time
required to repair such damage. If the demised premises are damaged or destroyed
or if they are not but the building is
<PAGE> 36
damaged, which damage materially adversely affects Tenant's access to the
demised premises, and the time period set forth in such estimate exceeds three
hundred and sixty (360) days, Tenant may elect to terminate this Lease by notice
to Landlord not later than fifteen (15) days following the delivery of such
estimate to Tenant. If Tenant makes such election, the Term shall expire upon
the twentieth (20th) day after notice of such election is given by Tenant and
Tenant shall vacate the demised premises and surrender the same to Landlord.
Upon such termination, Tenant's liability for fixed annual rent and additional
rent shall cease as of the day following such damage and any prepaid portion
thereof for any period after such date shall be refunded by Landlord to Tenant.
If (x) the estimate does not exceed three hundred and sixty (360) days, or (y)
Tenant fails to make its election as set forth hereinabove in this paragraph,
and if Landlord does not make the election under Section 13.3 (if applicable),
Landlord shall repair the damage and restore and rebuild the Building and/or the
demised premises, at its expense (without limiting the rights of Landlord under
any other provisions of this Lease); provided, however, that Landlord shall not
be required to repair or replace any of Tenant's property, improvements,
betterments or Alterations.
13.2 If the Building or the demised premises shall be
partially damaged or partially destroyed by fire or other cause, the fixed
annual rent and additional rent payable hereunder shall be abated to the extent
that the demised premises shall have been rendered untenantable for the period
from the date of such damage or destruction to the date the damage shall be
substantially repaired or restored. If the demised premises shall be totally
(which shall be deemed to include substantially totally) damaged or destroyed or
rendered completely (which shall be deemed to include substantially completely)
untenantable on account of fire or other cause, the fixed annual rent and
additional rent shall abate as of the date of the damage or destruction and
until Landlord shall substantially repair, restore and rebuild the Building and
the demised premises. Should Tenant reoccupy a portion of the demised premises
during the period the restoration work is taking place with respect to any
damage or destruction referred to in this Section 13.2 and prior to the date
that the same are made tenantable, rents allocable to such portion shall be
payable by Tenant from the date of such occupancy. Furthermore, if Tenant delays
the performance of the restoration work, such work shall be deemed to be
substantially completed on the date that it would have been completed but for
such delay.
13.3 If the Building or the demised premises shall be totally
(which shall be deemed to include substantially totally) damaged or destroyed by
fire or other cause, or if the Building shall be so damaged or destroyed by fire
or other cause (whether or not the demised premises are damaged or destroyed) as
to require a reasonably estimated expenditure of more than forty
<PAGE> 37
percent (40%) of the full insurable value of the Building immediately prior to
the casualty, then in either such case Landlord may terminate this Lease by
giving Tenant notice to such effect within one hundred twenty (120) days after
the date of the casualty.
13.4 No damages, compensation or claim shall be payable by
Landlord for inconvenience, loss of business or annoyance arising from any
repair or restoration of any portion of the demised premises or of the Building
pursuant to this Article 13.
13.5 Notwithstanding any of the foregoing provisions of this
Article 13, if Landlord or the lessor of any superior lease or the holder of any
superior mortgage shall be unable to collect all of the insurance proceeds
(including rent insurance proceeds) applicable to damage or destruction of the
demised premises or the Building by fire or other cause, by reason of some
action or inaction on the part of Tenant or any of its employees, agents or
contractors, then, without prejudice to any other remedies which may be
available against Tenant, there shall be no abatement of Tenant's rents, but the
total amount of such rents not abated (which would otherwise have been abated)
shall not exceed the amount of uncollected insurance proceeds.
13.6 Landlord will not carry separate insurance of any kind on
Tenant's property, improvements, betterments or Alterations and, shall not be
obligated to repair any damage thereto or replace the same. Tenant shall
maintain insurance on Tenant's property, improvements, betterments or
Alterations and Tenant shall be obligated to repair any damage thereto and
replace the same.
13.7 The provisions of this Article 13 shall be considered an
express agreement governing any cause of damage or destruction of the demised
premises by fire or other casualty, and no statute, rule, law or regulation of
the State of New York or any of its political subdivisions now or hereafter in
force and providing for such a contingency in the absence of an express
agreement (including without limitation Section 227 of the Real Property Law),
shall have application in such case.
ARTICLE 14
CONDEMNATION
14.1 In the event that the whole of the demised premises shall
be lawfully condemned or taken in any manner for any public or quasi-public use,
this Lease and the term and estate hereby granted shall forthwith cease and
terminate as of
<PAGE> 38
the date of vesting of title. In the event that only a part of the demised
premises shall be so condemned or taken, then, effective as of the date of
vesting of title, the fixed annual rent under Article l hereunder and additional
rents under Articles 3 and 4 hereunder shall be abated in an amount thereof
apportioned according to the area of the demised premises so condemned or taken.
In the event that only a part of the Building Project (as such term is defined
in subsection 3.2(i) hereof) shall be so condemned or taken, then (a) Landlord
(whether or not the demised premises be affected) may, at Landlord's option,
terminate this Lease and the term and estate hereby granted as of the date of
such vesting of title by notifying Tenant in writing of such termination within
sixty (60) days following the date on which Landlord shall have received notice
of vesting of title, or (b) if such condemnation or taking shall be of fifteen
percent (15%) or more of the demised premises or of a substantial part of the
means of access thereto, Tenant may, at Tenant's option, by delivery of notice
in writing to Landlord within thirty (30) days following the date on which
Tenant shall have received notice of vesting of title, terminate this Lease and
the term and estate hereby granted as of the date occurring six months after the
vesting of title, or (c) if neither Landlord nor Tenant elects to terminate this
Lease, as aforesaid, this Lease shall be and remain unaffected by such
condemnation or taking, except that the fixed annual rent payable under Article
1 and additional rents payable under Articles 3 and 4 shall be abated to the
extent hereinbefore provided. In the event that only a part of the demised
premises shall be so condemned or taken and this Lease and the term and estate
hereby granted with respect to the remaining portion of the demised premises are
not terminated as hereinbefore provided, Landlord will, with reasonable
diligence and at its expense, restore the remaining portion of the demised
premises as nearly as practicable to the same condition as it was in prior to
such condemnation or taking. Tenant shall be obligated to repair and replace its
property, improvements, betterments and Alterations.
14.2 In the event of its termination in any of the cases
hereinbefore provided, this Lease and the term and estate hereby granted shall
expire as of the date of such termination with the same effect as if that were
the Expiration Date, and the fixed annual rent and additional rents payable
hereunder shall be apportioned as of such date.
14.3 In the event of any condemnation or taking hereinbefore
mentioned of all or a part of the Building Project, Landlord shall be entitled
to receive the entire award in the condemnation proceeding, including any award
made for the value of the estate vested by this Lease in Tenant, and Tenant
hereby expressly assigns to Landlord any and all right, title and interest of
Tenant now or hereafter arising in or to any such award or any part thereof, and
Tenant shall be entitled to
<PAGE> 39
receive no part of such award. Provided that Landlord's award is not reduced by
reason thereof, Tenant may apply for an award for its moving expenses and trade
fixtures.
14.4 It is expressly understood and agreed that the provisions
of this Article 14 shall not be applicable to any condemnation or taking for
governmental occupancy for a limited period.
ARTICLE 15
ACCESS TO DEMISED PREMISES; CHANGES
15.1 Tenant shall permit Landlord to erect, use and maintain
pipes, ducts and conduits in and through the demised premises, provided the same
are installed adjacent to or concealed behind walls and ceilings of the demised
premises. Landlord shall to the extent practicable install such pipes, ducts and
conduits by such methods and at such locations as will not materially interfere
with or impair Tenant's layout or use of the demised premises. Landlord or its
agents or designees, on reasonable notice to Tenant (except in the case of
emergency), shall have the right to enter the demised premises, at reasonable
times during business hours (except in the case of emergency), for the making of
such repairs or alterations as Landlord may reasonably deem necessary for the
Building or which Landlord shall be required to or shall have the right to make
by the provisions of this Lease or any other lease in the Building and, subject
to the foregoing, shall also have the right to enter the demised premises for
the purpose of inspecting them or exhibiting them to prospective purchasers or
lessees of the entire Building or to prospective mortgagees of the fee or of the
Landlord's interest in the property of which the demised premises are a part or
to prospective assignees of any such mortgages or to the holder of any mortgage
on the Landlord's interest in the property, its agents or designees. Landlord
shall exercise reasonable diligence so as to minimize the disturbance, but
nothing contained herein shall be deemed to require Landlord to perform the same
on an overtime or premium pay basis.
15.2 Landlord reserves the right, without the same
constituting an eviction and without incurring liability to Tenant therefor, to
change the arrangement and/or location of public entrances, passageways, doors,
doorways, corridors, possible elevators, stairways, toilets and other public
parts of the Building; provided, however, that access to the Building shall not
be cut off and there shall be no unreasonable obstruction of access to the
demised premises or unreasonable interference with the use or enjoyment thereof.
<PAGE> 40
15.3 In connection with any work performed by Landlord in
accordance with the provisions of this Article 15, upon the completion of such
work, Landlord will restore as closely as reasonably possible any improvements
located on the demised premises to the condition of such improvements prior to
the commencement of such work by Landlord; provided, however, nothing contained
in this paragraph is meant to (i) limit in any way Landlord's rights to perform
any work or repairs permitted to be performed by this Article 15 or (ii) require
the use of labor on an overtime or premium pay basis to perform such restoration
work on the improvements located on the demised premises.
15.4 Landlord may, during the six (6) months prior to
expiration of the term of this Lease, exhibit the demised premises to
prospective tenants during normal business hours upon reasonable advance notice
to Tenant.
15.5 If Tenant shall not be personally present to open and
permit an entry into the demised premises at any time when for any reason an
entry therein shall be urgently necessary by reason of fire or other emergency,
Landlord or Landlord's agents may forcibly enter the same without rendering
Landlord or such agents liable therefor (if during such entry Landlord or
Landlord's agents shall accord reasonable care to Tenant's property and shall be
liable for any loss, damage or theft) and without in any manner affecting the
obligations and covenants of this Lease.
ARTICLE 16
DEFAULT
16.1 This Lease and the term and estate hereby granted are
subject to the limitation that whenever Tenant shall make an assignment of the
property of Tenant for the benefit of creditors, or shall file a voluntary
petition under any bankruptcy or insolvency law or any involuntary petition
alleging an act of bankruptcy or insolvency shall be filed against Tenant under
any bankruptcy or insolvency law, or whenever a petition shall be filed by or
against Tenant under the reorganization provisions of the United States
Bankruptcy Act or under the provisions of any law of like import, or whenever a
petition shall be filed by Tenant under the provisions of any law of like
import, or whenever a permanent receiver of Tenant or of or for the property of
Tenant shall be appointed, then, Landlord may, (a) at any time after receipt of
notice of the occurrence of any such event, and (b) if such event occurs without
the acquiescence of Tenant, at any time after the event continues for sixty (60)
days, give Tenant a notice of intention to end the term of this Lease at the
expiration of five (5) days from the date of service
<PAGE> 41
of such notice of intention, and upon the expiration of said five (5) day
period, this Lease and the term and estate hereby granted, whether or not the
term shall theretofore have commenced, shall terminate with the same effect as
if that day were the Expiration Date, but Tenant shall remain liable for damages
as provided in Article 18.
16.2 This Lease and the term and estate hereby granted are
subject to further limitation as follows:
(a) whenever Tenant shall default in the payment of any
installment of fixed annual rent, or in the payment of any additional rent or
any other charge payable by Tenant to Landlord, in either case for ten (10)
Business Days after written notice is given to Tenant that such payment shall
have become due; or
(b) whenever Tenant shall do or permit anything to be done,
whether by action or inaction, contrary to or in violation of any of Tenant's
obligations, or, the terms, conditions or provisions hereunder, other than
Tenant's obligations to pay fixed annual rent or additional rent or other
charges under this Lease, and if such situation shall continue and shall not be
remedied by Tenant within twenty (20) days after Landlord shall have given to
Tenant a notice specifying the same, or, in the case of a happening or default
which cannot with due diligence be cured within a period of twenty (20) days and
the continuation of which for the period required for cure will not subject
Landlord to the risk of criminal or civil liability (as more particularly
described in Article 8 hereof) or termination of any superior lease or
foreclosure of any superior mortgage, if Tenant shall not, (i) within said
twenty (20) day period advise Landlord of Tenant's intention to duly institute
all steps necessary to remedy such situation, (ii) duly institute within said
twenty (20) day period, and thereafter diligently and continuously prosecute to
completion all steps necessary to remedy the same and (iii) complete such remedy
within such time after the date of the giving of said notice of Landlord as
shall reasonably be necessary; or
(c) whenever any event shall occur or any contingency shall
arise whereby this Lease or the estate hereby granted or the unexpired balance
of the term hereof would, by operation of law or otherwise, devolve upon or pass
to any person, firm, corporation or other entity other than Tenant, except as
expressly permitted by Article 11; or
(d) whenever Tenant shall abandon the demised premises (unless
as a result of a casualty) and such abandonment shall continue for twenty (20)
days after Landlord shall have given Tenant notice thereof; or
<PAGE> 42
(e) whenever Tenant shall default in the due keeping,
observing or performance of any covenant, agreement, provision or condition of
Article 5 hereof on the part of Tenant to be kept, observed or performed and if
such default shall continue and shall not be remedied by Tenant within three (3)
Business Days after Tenant receives a notice specifying the same; or
(f) whenever Tenant shall default with respect to any other
lease between Landlord and Tenant;
then in any of said cases set forth in the foregoing subsections (a), (b), (c),
(d), (e) and (f), Landlord may give to Tenant a notice of intention to end the
term of this Lease at the expiration of three (3) days from the date of the
service of such notice of intention, and upon the expiration of said three (3)
days this Lease and the term and estate hereby granted, whether or not the term
shall theretofore have commenced, shall terminate with the same effect as if
that day were the Expiration Date, but Tenant shall remain liable for damages as
provided in Article 18.
<PAGE> 43
ARTICLE 17
RE-ENTRY BY LANDLORD, INJUNCTION
17.1 If Tenant shall default in the payment of any installment
of fixed annual rent, or of any additional rent or other charges under this
Lease, on any date upon which the same ought to be paid, and if such default
shall continue for ten (10) days after Landlord shall have given to Tenant a
notice specifying such default, or if any of the events described in Article 16
shall occur, Landlord or Landlord's agents and employees may immediately or at
any time thereafter re-enter the demised premises, or any part thereof, either
by summary dispossess proceedings or by any suitable action or proceeding at
law, without being liable to indictment, prosecution or damages therefrom, to
the end that Landlord may have, hold and enjoy the demised premises again as and
of its first estate and interest therein. The word re-enter, as herein used, is
not restricted to its technical legal meaning. In the event of any termination
of this Lease under the provisions of Article 16 or if Landlord shall re-enter
the demised premises under the provisions of this Article 17 or in the event of
the termination of this Lease, or of re-entry, by or under any summary
dispossess or other proceedings or action by reason of default hereunder on the
part of Tenant, Tenant shall thereupon pay to Landlord the fixed annual rent and
additional rent payable by Tenant to Landlord up to the time of such termination
of this Lease, or of such recovery of possession of the demised premises by
Landlord, as the case may be, and shall also pay to Landlord damages as provided
in Article 18.
17.2 In the event of a breach or threatened breach by Tenant
of any of its obligations under this Lease, Landlord shall also have the right
of injunction. The special remedies to which Landlord may resort hereunder are
cumulative and are not intended to be exclusive of any other remedies or means
of redress to which Landlord may lawfully be entitled at any time and Landlord
may invoke any remedy allowed at law or in equity as if specific remedies were
not provided for herein.
17.3 If this Lease shall terminate under the provisions of
Article 16, or if Landlord shall re-enter the demised premises under the
provisions of this Article 17, or in the event of the termination of this Lease,
or of re-entry by or under any summary dispossess or other proceeding or action
by reason of default hereunder on the part of Tenant, Landlord shall be entitled
to retain all moneys, if any, paid by Tenant to Landlord, whether as advance
rent, security or otherwise, but such moneys shall be credited by Landlord
against any fixed
<PAGE> 44
annual rent or additional rent due from Tenant at the time of such termination
or re-entry or, at Landlord's option against any damages payable by Tenant under
this Article 17 or Article 18 or pursuant to law.
17.4 Tenant hereby expressly waives any and all rights of
redemption granted by or under any present or future laws in the event of Tenant
being evicted or dispossessed for any cause, or in the event of Landlord
obtaining possession of the demised premises, by reason of the violation by
Tenant of any of the covenants and conditions of this Lease or otherwise.
ARTICLE 18
DAMAGES
18.1 If this Lease is terminated under the provisions of
Article 16, or if Landlord shall re-enter the demised premises under the
provisions of Article 17, or in the event of the termination of this Lease, or
of re-entry, by or under any summary dispossess or other proceeding or action by
reason of default hereunder on the part of Tenant, Tenant shall pay to landlord
as damages, at the election of Landlord, either
(a) a sum which at the time of such termination of this Lease
or at the time of any such re-entry by Landlord, as the case may be, represents
the present value (which present value shall be calculated at a discount rate
equal to the then legal rate of interest on judgments in New York State) of the
excess, if any, of
(i) the aggregate of the fixed annual rent and the additional
rent payable hereunder which would have been payable by Tenant
(conclusively presuming the additional rent to be the same as was
payable for the year immediately preceding such termination except that
additional rent on account of increases in Taxes and Expenses shall be
presumed to increase at the average of the rates of increase thereof
previously experienced by Landlord during the period (not to exceed
three (3) years) prior to such termination) for the period commencing
with such earlier termination of this Lease or the date of any such
re-entry, as the case may be, and ending with the Expiration Date, had
this Lease not so terminated or had Landlord not so re-entered the
demised premises, over
(ii) the aggregate rental value of the demised premises for
the same period, or
(b) sums equal to the fixed annual rent and the
<PAGE> 45
additional rent (as above presumed) payable hereunder which would have been
payable by Tenant had this Lease not so terminated, or had Landlord not so
re-entered the demised premises, payable upon the due dates therefor specified
herein following such termination or re-entry and until the Expiration Date;
provided, however, that if Landlord shall re-let the demised premises during
said period, Landlord shall credit Tenant with the net rents received by
Landlord from such re-letting, such net rents to be determined by first
deducting from the gross rents as and when received by Landlord from such
re-letting, the expenses incurred or paid by Landlord in terminating this Lease
or in re-entering the demised premises and in securing possession thereof, as
well as the expenses of re-letting, including altering and preparing the demised
premises for new tenants, brokers' commissions and all other expenses properly
chargeable against the demised premises and the rental thereof; it being
understood that any such re-letting may be for a period shorter or longer than
the remaining term of this Lease; but in no event shall Tenant be entitled to
receive any excess of such net rents over the sums payable by Tenant to Landlord
hereunder, nor shall Tenant be entitled in any suit for the collection of
damages pursuant to this subsection to a credit in respect of any net rents from
a re-letting, except to the extent that such net rents are actually received by
Landlord. If the demised premises or any part thereof should be re-let in
combination with other space, then proper apportionment on a square foot basis
shall be made of the rent received from such re-letting and of the expenses of
re-letting.
If the demised premises or any part thereof be re-let by Landlord for the
unexpired portion of the term of this Lease, or any part thereof, before
presentation of proof of such damages to any court, commission or tribunal, the
amount of rent reserved upon such re-letting shall, prima facie, be the fair and
reasonable rental value for the demised premises, or part thereof, so re-let
during the term of the re-letting.
18.2 Suit or suits for the recovery of such damages, or any
installments thereof, may be brought by Landlord from time to time at its
election, and nothing contained herein shall be deemed to require Landlord to
postpone suit until the date when the term of this Lease would have expired if
it had not been so terminated under the provisions of Article 16, or under any
provision of law, or had Landlord not re-entered the demised premises. Nothing
herein contained shall be construed to limit or preclude recovery by Landlord
against Tenant of any sums or damages to which, in addition to the damages
particularly provided above, Landlord may lawfully be entitled by reason of any
default hereunder on the part of Tenant. Nothing herein contained shall be
construed to limit or prejudice the right of Landlord to prove for and obtain as
liquidated damages by reason of the termination of this Lease or re-entry of the
demised
<PAGE> 46
premises for the default of Tenant under this Lease, an amount equal to the
maximum allowed by any statute or rule of law in effect at the time when, and
governing the proceedings in which, such damages are to be proved whether or not
such amount be greater, equal to, or less than any of the sums referred to in
Section 18.1.
ARTICLE 19
LANDLORD'S RIGHT TO PERFORM TENANT'S OBLIGATIONS
19.1 If Tenant shall default in the observance or performance
of any term or covenant on Tenant's part to be observed or performed under or by
virtue of any of the terms or provisions of this Lease, (a) Landlord may remedy
such default for the account of Tenant, immediately and without notice in case
of emergency, or in any other case only provided that Tenant shall fail to
remedy such default after Landlord shall have notified Tenant in writing of such
default and the applicable grace period for curing such default shall have
expired; and (b) if Landlord makes any expenditures or incurs any obligations
for the payment of money in connection with such default including, but not
limited to, reasonable attorneys' fees and expenses, such sums paid or
obligations incurred, with interest at the Interest Rate, shall be deemed to be
additional rent hereunder and shall be paid by Tenant to Landlord within thirty
(30) days after rendition of a bill to Tenant therefor.
ARTICLE 20
QUIET ENJOYMENT
20.1 Landlord covenants and agrees that subject to the terms
and provisions of this Lease, if, and so long as, Tenant keeps and performs in
all material respects each and every covenant, agreement, term, provision and
condition herein contained on the part or on behalf of Tenant to be kept or
performed, then Tenant's rights under this Lease shall not be cut off or ended
before the expiration of the term of this Lease, subject however to ground and
underlying leases and mortgages by anyone claiming by or through Landlord which
affect this Lease (as provided in Article 25 hereof).
ARTICLE 21
SERVICES AND EQUIPMENT
<PAGE> 47
21.1 Landlord shall, at its cost and expense (but subject to
reimbursement by Tenant pursuant to Article 4 hereof):
(a) provide necessary passenger elevator facilities during
Business Hours (as such term is defined in Article 22 hereof) and shall have at
least one passenger elevator subject to call at all other times. At Landlord's
option, the elevators shall be operated by automatic control or by manual
control, or by a combination of both of such methods. Landlord shall provide
freight elevator service to Tenant upon reasonable notice from Tenant;
(b) maintain, keep in repair and provide the services of the
Building system air-conditioning, heating and ventilating system ("HVAC SYSTEM")
installed by Landlord in accordance with the design criteria annexed hereto as
EXHIBIT E. The aforesaid systems will function when seasonably required during
Business Hours. The cooling season for the purposes of this Lease shall be May
15 through September 15 of each calendar year. Landlord shall have no
responsibility or liability for the ventilating conditions and/or temperature of
the demised premises during the hours or days Landlord is not required to
furnish heat, ventilation or air-conditioning pursuant to this subsection. In
any event, Tenant shall keep entirely unobstructed all the vents, intakes,
outlets and grilles, at all times and shall comply with and observe all
regulations and requirements prescribed by Landlord for the proper functioning
of the heating, ventilating and air-conditioning systems including without
limitation, the lowering and closing of Venetian blinds in the demised premises
during daylight hours. In the event that Tenant shall require air-conditioning,
heating or ventilation at such times as same are not furnished by Landlord,
Tenant shall give Landlord at least 24-hours advance notice of such requirement,
and Tenant agrees to pay the Landlord's prevailing rate therefor as additional
rent.
(c) provide cleaning and janitorial services on Business Days
in accordance with the specifications annexed hereto as EXHIBIT F; provided,
however, Tenant shall pay to Landlord upon ten (10) days notice the costs
incurred by Landlord for (a) extra cleaning work in the demised premises
required because of (i) misuse or neglect on the part of Tenant or its employees
or visitors, (ii) use of portions of the demised premises for preparation,
serving or consumption of food or beverages, data processing or reproducing
operations, private lavatories or toilets or other special purposes requiring
greater or more difficult cleaning work than office areas, (iii) unusual
quantity of interior glass surfaces, (iv) non-building standard materials or
finishes installed by Tenant or at its request, and (b) removal from the demised
premises and the Building of so much of any refuse and rubbish of Tenant as
shall exceed that
<PAGE> 48
ordinarily accumulated daily in the routine of business office occupancy.
Landlord, its cleaning contractor and their employees shall have access outside
of Business Hours to the demised premises and the use (at Tenant's expense) of
light, power and water in the demised premises as reasonably required for the
purpose of cleaning the demised premises in accordance with Landlord's
obligations hereunder; and
(d) furnish hot and cold water for lavatory and office
cleaning purposes and cold water for drinking purposes. If Tenant requires, uses
or consumes water for any other purposes, Tenant agrees to Landlord installing a
meter or meters or other means to measure Tenant's water consumption, and Tenant
further agrees to reimburse Landlord for the cost of the meter or meters and the
installation thereof, and to pay for the maintenance of said meter equipment
and/or to pay Landlord's cost of other means of measuring such water consumption
by Tenant. Tenant shall reimburse Landlord for the cost of all water consumed,
as measured by said meter or meters or as otherwise measured, including, without
limitation, sewer rents.
21.2 Landlord reserves the right to stop the heating,
air-conditioning, elevator, plumbing, electric and other systems when necessary
by reason of accident or emergency or for repairs, alterations, replacements or
improvements, provided that except in case of emergency, Landlord will notify
Tenant in advance of any such stoppage and its estimated duration, and will
proceed diligently with the work necessary to resume such service as promptly as
possible and in a manner so as to minimize interference with the Tenant's use
and enjoyment of the demised premises but nothing herein shall be deemed to
require Landlord to perform the same on an overtime or premium pay basis unless
requested to do so by, and at the expense of, Tenant.
21.3 It is expressly agreed that only Landlord or any one or
more persons, firms or corporations authorized in writing by Landlord will be
permitted to furnish laundry, linen towels, drinking water, ice, food or
beverages and other similar supplies and services to tenants and licensees in
the Building provided the quality thereof and the charges therefor are
reasonably comparable to that of other suppliers of such services. Landlord may
fix, in its own absolute discretion, at any time and from time to time, the
hours during which and the regulations under which such supplies and services
are to be furnished. Landlord expressly reserves the right to act as or to
designate, at any time and from time to time, an exclusive supplier of all or
any one or more of the said supplies and services, provided that the quality
thereof and the charges therefor are reasonably comparable to that of other
suppliers; and Landlord furthermore expressly reserves the right to exclude from
the Building any person, firm or corporation attempting to furnish any of said
supplies or services but not so designated by Landlord. It is
<PAGE> 49
understood, however, that Tenant or regular office employees of Tenant who are
not employed by any supplier of such food or beverages or by any person, firm or
corporation engaged in the business of purveying such food or beverages, may
personally bring food or beverages into the Building for consumption within the
demised premises by employees of Tenant, but not for resale to or for
consumption by any other tenant. Landlord may fix in its absolute discretion, at
any time and from time to time, the hours during which, and the regulations
under which, foods and beverages may be brought into the Building by regular
employees of Tenant.
21.4 Tenant agrees to employ such third-party office
maintenance contractor as Landlord may from time to time reasonably designate,
for all waxing, polishing, lamp replacement, cleaning (other than those cleaning
services Landlord is obligated to furnish) and the maintenance work in the
demised premises, provided that the quality thereof and the charges therefor are
reasonably comparable to that of other contractors. Tenant shall not employ any
other contractor without Landlord's prior written consent, which consent shall
not be unreasonably withheld or delayed.
21.5 Landlord will maintain a listing on the Building
directory for Tenant. Landlord will provide a plaque in the mail room for any
additional names Tenant wishes. Tenant may place a sign, approved by Landlord,
on the entrance doors to the demised premises with Tenant's name. Other than
Tenant's name, Tenant shall place no other names, plaques, signs or the like on
the entrance doors to the demised premises and shall place no names, plaques,
signs or the like elsewhere on the exterior of the demised premises. The listing
of any name other than that of the Tenant, whether on the doors of the demised
premises, on the Building directory, or otherwise, shall not operate to vest any
right or interest in this Lease or in the demised premises or to be deemed to be
the written consent of Landlord mentioned in Article 11 hereof, it being
expressly understood that any such listing is a privilege extended by Landlord
revocable at will by written notice to Tenant.
21.6 Landlord will not be required to furnish any other
services, except as otherwise provided in this Lease.
ARTICLE 22
DEFINITIONS
22.1 The term "LANDLORD" as used in this Lease means only the
owner, or the mortgagee in possession, for the time being of the Land and the
Building or the Building Project (or
<PAGE> 50
the owner of a lease of the Building Project or the Building or of the Land and
Building), so that in the event of any transfer of title to the Building Project
or said Land and the Building or said lease, or in the event of a lease of the
Building Project or the Building, or of the Land and the Building, the said
transferor Landlord shall be and hereby is entirely freed and relieved of all
future covenants, obligations and liabilities of Landlord hereunder, and it
shall be deemed and construed as a covenant running with the land without
further agreement between the parties or their successors in interest, or
between the parties and the transferee of title to the Building Project or said
Land and the Building or said lease, or the said lessee of the Building Project
or the Building, or of the Land and the Building, that the transferee or the
lessee has assumed and agreed to carry out any and all such covenants,
obligations and liabilities of Landlord hereunder arising after such transfer.
22.2 The term "BUSINESS DAYS" as used in this Lease shall
exclude Saturdays, Sundays and the following holidays: New Year's Day, Good
Friday, Memorial Day, Independence Day, Labor Day, President's Day, Thanksgiving
Day and the immediately following day, Christmas Day, and all other days
recognized as holidays under applicable union contracts.
22.3 "INTEREST RATE" shall mean a rate per annum equal to the
lesser of (a) two percent (2%) above the commercial lending rate announced from
time to time by The Chase Manhattan Bank (or any successor), as its prime rate
for 90-day unsecured loans, or (b) the maximum applicable legal rate, if any.
22.4 "LEGAL REQUIREMENTS" shall mean laws, statutes and
ordinances (including building codes and zoning regulations and ordinances) and
the orders, rules, regulations, directives and requirements of all federal,
state, county, city and borough departments, bureaus, boards, agencies, offices,
commissions and other subdivisions thereof, or of any official thereof, or of
any other governmental public or quasi-public authority, whether now or
hereafter in force, which may be applicable to the Building Project, the Land or
the Building or the demised premises or any part thereof, or the sidewalks,
curbs or areas adjacent thereto (including, without limitation, the Common
Areas) and all requirements, obligations and conditions of all instruments of
record on the date of this Lease.
22.5 "BUSINESS HOURS" shall mean 8:00 A.M. to 6:00 P.M. on
Business Days.
ARTICLE 23
INVALIDITY OF ANY PROVISION
<PAGE> 51
23.1 If any term, covenant, condition or provision of this
Lease or the application thereof to any circumstance or to any person, firm or
corporation shall be invalid or unenforceable to any extent, the remaining
terms, covenants, conditions and provisions of this Lease or the application
thereof to any circumstances or to any person, firm or corporation other than
those as to which any term, covenant, condition or provision is held invalid or
unenforceable, shall not be affected thereby, and each remaining term, covenant,
condition and provision of this Lease shall be valid and shall be enforceable to
the fullest extent permitted by law.
ARTICLE 24
BROKERAGE
24.1 Landlord and Tenant each covenant, represent and warrant
that it has had no dealings or communications with any broker or agent in
connection with this Lease other than Benson Commercial Realty, Inc. ("BROKER"),
and each covenants and agrees to pay, hold harmless and indemnify the other from
and against any and all cost, expense (including reasonable attorneys' fees and
expenses) or liability for any compensation, commissions or charges claimed by
any other broker or agent with whom the indemnifying party dealt with respect to
this Lease or the negotiation thereof. Landlord will pay any commission earned
by Broker, pursuant to the terms of a separate agreement.
ARTICLE 25
SUBORDINATION
25.1 This Lease is and shall be subject and subordinate to all
ground or underlying leases which may now or hereafter affect the real property
of which the demised premises form a part and to all mortgages which may now or
hereafter affect such leases or such real property, and to all renewals,
modifications, replacements and extensions thereof. The provisions of this
Section 25.1 shall be self-operative and no further instrument of subordination
shall be required. In confirmation of such subordination, Tenant shall promptly
execute and deliver at its own cost and expense any instrument, in recordable
form if required, that Landlord, the lessor of the ground or underlying lease or
the holder of any such mortgage or any of their respective successors in
interest may request to evidence such subordination.
<PAGE> 52
25.2 In the event of a termination of any ground or underlying
lease, 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 under this Lease will, at the option to be
exercised in writing by the lessor under such ground or underlying lease or such
mortgagee or purchaser, assignee or lessee, as the case may be, either (i)
attorn to it and will perform for its benefit all the terms, covenants and
conditions of this Lease on Tenant's part to be performed with the same force
and effect as if said lessor, such mortgagee or purchaser, assignee or lessee,
were the landlord originally named in this Lease, or (ii) enter into a new lease
with said lessor or such mortgagee or purchaser, assignee or lessee, as
landlord, for the remaining term of this Lease and otherwise on the same terms
and conditions and with the same options, if any, then remaining. The foregoing
provisions of clause (i) of this Section 25.2 shall enure to the benefit of such
lessor, mortgagee, purchaser, assignee or lessee, shall be self-operative upon
the exercise of such option, and no further instrument shall be required to give
effect to said provisions. Tenant, however, upon demand of any such lessor,
mortgagee, purchaser, assignee or lessee agrees to execute, from time to time,
instruments in confirmation of the foregoing provisions of this Section 25.2,
satisfactory to any such lessor, mortgagee, purchaser, assignee or lessee,
acknowledging such subordination and attornment and setting forth the terms and
conditions of its tenancy. Tenant hereby constitutes and appoints Landlord or
its successors in interest to be the Tenant's attorney-in-fact, irrevocably and
coupled with an interest, to execute and deliver such instrument of attornment,
or such new lease, if Tenant refuses or fails to do so promptly upon request.
25.3 Anything herein contained to the contrary
notwithstanding, under no circumstances shall the aforedescribed lessor under
the ground lease or mortgagee or purchaser, assignee or lessee, as the case may
be, whether or not it shall have succeeded to the interests of the landlord
under this Lease, be
(a) liable for any act, omission or default of any prior
landlord so long as such ground lessor or mortgagee shall not be a "related
party" (as that term is defined by the Internal Revenue Code of such prior
landlord); or
(b) subject to any offsets, claims or defenses which the
Tenant might have against any prior landlord; or
(c) bound by any rent or additional rent which Tenant might
have paid to any prior landlord for more than one (1) month in advance or for
more than three (3) months in advance where such rent payments are payable at
intervals of more than one (1) month; or
<PAGE> 53
(d) bound by any modification, amendment or abridgment of the
Lease, or any cancellation or surrender of the same, made without its prior
written approval.
25.4 If, in connection with the financing of the Building, the
holder of any mortgage shall request reasonable modifications in this Lease as a
condition of approval thereof, Tenant will not unreasonably withhold, delay or
defer making such modifications provided such modifications do not increase
Tenant's monetary obligations, change the Term, change the demised premises or
materially increase any other of Tenant's obligations or materially decrease
Tenant's rights under this Lease.
ARTICLE 26
CERTIFICATES OF LANDLORD AND TENANT
26.1 Tenant shall, without charge, at any time and from time
to time, within ten (10) days after request by Landlord, deliver a written
instrument to Landlord or any other person, firm or corporation specified by
Landlord, duly executed and acknowledged, certifying:
(a) that this Lease is unmodified and in full force and effect
or, if there has been any modification, that the same is in full force and
effect as modified and stating any such modification, whether there is any
existing basis to cancel or terminate this Lease, and whether to the best of
Tenant's knowledge Landlord is in default thereunder;
(b) that the term of this Lease has commenced and rent has
become payable thereunder, and that Tenant is in possession of all of the
demised premises;
(c) the amount of the fixed annual rent payable under this
Lease and the dates to which the fixed annual rent and additional rent and other
charges hereunder, have been paid; and
(d) whether or not Tenant has made any claim against Landlord
under this Lease and if so the nature thereof and the dollar amount, if any, of
such claim.
26.2 Landlord agrees, at any time and from time to time, as
requested by Tenant, upon not less than ten (10) days prior notice, to execute
and deliver a statement certifying that this Lease is unmodified and in full
force and effect (or if there have been modifications that the same is in full
force as modified and stating the modifications), certifying the dates to
<PAGE> 54
which the fixed rent and additional rent have been paid, and stating whether or
not, to the best knowledge of the signer, Tenant is an default in performance of
any of his obligations under this Lease, and, if so, specifying each such
default of which the signer may have knowledge.
26.3 Tenant agrees that, except for the first month's rent
hereunder, it will pay no rent under this Lease more than thirty (30) days in
advance of its due date, if so restricted by any existing or future ground lease
or mortgage to which this Lease is subordinated or by an assignment of this
Lease to the ground lessor or the holder of such mortgage, and, in the event of
any act or omission by Landlord, Tenant will not exercise any right to remedy
the default until Tenant shall have given written notice of such act or omission
to the ground lessor and to the holder of any mortgage on the fee or the ground
lease who shall have furnished such lessor's or holder's last address to Tenant,
and until a reasonable period for remedying such act or omission shall have
elapsed following the giving of such notices, during which time such lessor or
holder shall have the right, but shall not be obligated, to remedy or cause to
be remedied such act or omission.
ARTICLE 27
LEGAL PROCEEDINGS WAIVER OF JURY TRIAL
27.1 Landlord and Tenant do hereby waive trial by jury in any
action, proceeding or counterclaim brought by either of the parties hereto
against the other on any matters 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 demised premises, and/or any other claims (except claims for
personal injury or property damage) and any emergency statutory or any other
statutory remedy. It is further mutually agreed that in the event Landlord
commences any summary action or proceeding for non-payment of rent, Tenant will
not interpose and does hereby waive the right to interpose any counterclaim of
whatever nature or description in any such proceeding.
ARTICLE 28
SURRENDER OF PREMISES
28.1 Upon the expiration or other termination of the term of
this Lease, Tenant shall quit and surrender to Landlord the demised premises,
broom clean, in good order and condition, ordinary wear and tear and damage by
fire, the elements or other casualty that Tenant is not required to repair
excepted, and Tenant shall remove all of its property as herein provided.
<PAGE> 55
Tenant's obligation to observe or perform this covenant shall survive the
expiration or other termination of the term of this Lease. If Tenant remains in
possession of the demised premises after the termination of this Lease without
the execution of a new lease, Tenant, at the option of Landlord, shall be deemed
to be occupying the demised premises as a tenant from month to month, subject to
all of the other terms and conditions of this Lease insofar as the same are
applicable to a month-to-month tenancy, but at a monthly rental equal to 200% of
the monthly fixed annual rent, Tax Escalation Payment and Expense Payment last
payable by Tenant hereunder. Nothing contained in this Section 28.1 shall (i)
imply any right of Tenant to remain in the demised premises after the
termination of this Lease without the execution of a new lease, (ii) imply any
obligation by Landlord to grant a new lease or (iii) be construed to limit any
right or remedy that Landlord has against Tenant as a holdover tenant or
trespasser.
ARTICLE 29
RULES AND REGULATIONS
29.1 Tenant and Tenant's servants, employees and agents shall
observe faithfully and comply strictly with the Rules and Regulations set forth
in EXHIBIT G attached hereto and made part hereof entitled "Rules and
Regulations" and such other and further reasonable Rules and Regulations as
Landlord or Landlord's agents may from time to time adopt; provided, however,
that in case of any conflict or inconsistency between the provisions of this
Lease and of any of the Rules and Regulations as originally or as hereafter
adopted, the provisions of this Lease shall control. Reasonable written notice
of any additional Rules and Regulations shall be given to Tenant and any dispute
with respect to the reasonableness of any such additional Rules and Regulations
shall be resolved by arbitration in accordance with the Commercial Arbitration
Rules of the American Arbitration Association. Landlord agrees that it shall not
enforce or fail to enforce any of the Rules and Regulations in a manner so as to
apply the same in an unfairly discriminatory manner with respect to Tenant.
Nothing in this Lease contained shall be construed to impose
upon Landlord any duty or obligation to enforce the Rules and Regulations or the
terms, covenants or conditions in any other lease, against any other tenant of
the Building, and Landlord shall not be liable to Tenant for violation of the
same by any other tenant, its servants, employees, agents, visitors or
licensees.
<PAGE> 56
ARTICLE 30
CONSENTS AND APPROVALS
30.1 Wherever in this Lease Landlord's consent or approval is
required and the lease provides that Landlord shall not unreasonably withhold or
delay such consent or approval, if Landlord shall delay or refuse such consent
or approval, Tenant in no event shall 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 unreasonably withheld
or unreasonably delayed its consent or approval. Tenant's sole remedy shall be
an action or proceeding to enforce any such provision, for specific performance,
injunction or declaratory judgment.
30.2 If Tenant desires to determine any dispute between
Landlord and Tenant as to the reasonableness of Landlord's decision to refuse to
consent to (i) any assignment or subletting in accordance with the provisions of
Article 11 hereof with respect to which Landlord expressly agreed not to
withhold its consent, or (ii) any Alteration pursuant to the provisions of
Article 2 or 6 hereof with respect to which Landlord expressly agreed not to
withhold its consent, such dispute shall be settled and finally determined by
arbitration in the County of New York in accordance with the Commercial
Arbitration Rules of the American Arbitration Association.
ARTICLE 31
NOTICES
31.1 Any notice or demand, consent, approval or disapproval,
or statement required to be given by the terms and provisions of this Lease, or
by any law or governmental regulation, either by Landlord to Tenant or by Tenant
to Landlord, shall be in writing. Unless otherwise required by such law or
regulation, such notice, demand, consent, approvals, statement or disapproval
shall be given, and shall be deemed to have been served and given when such
notice or demand is mailed by registered or certified mail deposited enclosed in
a securely closed post-paid wrapper, in a United States Government general or
branch post office, or official depository with the exclusive care and custody
thereof, or delivered to an overnight delivery service requiring a receipt,
addressed to Landlord or to Tenant at its address set forth on page one (1) of
this Lease (except that after the Commencement Date, Tenant's address, unless
Tenant shall give notice to the contrary, shall be the Building, directed to the
attention of General Counsel). At such time as
<PAGE> 57
Tenant or anyone claiming under or through Tenant first occupies the demised
premises for the conduct of its business, all such notices and demands shall be
served or given to Tenant at the demised premises in lieu of its address on page
one (1) hereof. Either party may, by notice as aforesaid, designate a different
address or addresses for notices, demands, consents, approvals statements or
disapprovals.
31.2 In addition to the foregoing, either Landlord or Tenant
may, from time to time, request in writing that the other party serve a copy of
any notice or demand, consent, approval or disapproval, or statement, on one
other person or entity designated in such request, such service to be effected
as provided in Section 31.1 hereof.
ARTICLE 32
NO WAIVER
32.1 No agreement to accept a surrender of this Lease shall be
valid unless in writing signed by Landlord. No employee of Landlord or of
Landlord's agents shall have any power to accept the keys of the demised
premises prior to the expiration or termination of this Lease. The delivery of
keys to any employee of Landlord or of Landlord's agent shall not operate as a
termination of this Lease or a surrender of the demised premises. In the event
of Tenant at any time desiring to have Landlord sublet the premises for Tenant's
account, Landlord or Landlord's agents are authorized to receive said keys for
such purpose without releasing Tenant from any of the obligations under this
Lease. The failure of Landlord to seek redress for violation of, or to insist
upon the strict performance of, any term, provision, covenant or condition of
this Lease or any of the Rules and Regulations set forth herein, or hereafter
adopted by Landlord, shall not prevent a subsequent act, which would have
originally constituted a violation, from having all the force and effect of an
original violation. The receipt by Landlord of rent with knowledge of the breach
of any covenant of this Lease shall not be deemed a waiver of such breach. The
failure of Landlord to enforce any of the Rules and Regulations set forth
herein, or hereafter adopted, against Tenant and/or any other tenant in the
Building shall not be deemed a waiver of any such Rules and Regulations. No
provision of this Lease shall be deemed to have been waived by Landlord, unless
such waiver be in writing signed by Landlord. No payment by Tenant or receipt by
Landlord of a lesser amount than the rent herein stipulated shall be deemed to
be other than on the account of the earliest stipulated rent, nor shall any
endorsement or statement on any check or any letter accompanying any check or
payment of rent be deemed an accord and satisfaction, and Landlord may accept
such check or payment
<PAGE> 58
without prejudice to Landlord's right to recover the balance of such rent or
pursue any other remedy in this Lease provided.
32.2 This Lease contains the entire agreement between the
parties, and any executory agreement hereafter made shall be ineffective to
change, modify, discharge or effect an abandonment of it in whole or in part
unless such executory agreement is in writing and signed by the party against
whom enforcement of the change, modification, discharge or abandonment is
sought.
ARTICLE 33
CAPTIONS
33.1 The captions are inserted only as a matter of convenience
and for reference, and in no way define, limit or describe the scope of this
Lease nor the intent of any provision thereof.
ARTICLE 34
INABILITY TO PERFORM
34.1 If, by reason of (i) strike, (ii) labor troubles, (iii)
governmental preemption in connection with a national emergency, (iv) any rule,
order or regulation of any governmental agency, (v) conditions of supply or
demand which are affected by war or other national, state or municipal
emergency, or any other cause or (vi) any other cause beyond Landlord's
reasonable control, Landlord shall be unable to fulfill its obligations under
this Lease or shall be unable to supply any service which Landlord is obligated
to supply, this Lease and Tenant's obligation to pay rent hereunder shall in no
wise be affected, impaired or excused, except as provided in Section 13.2 and
14.1.
ARTICLE 35
NO REPRESENTATIONS BY LANDLORD
35.1 Landlord or Landlord's agents have made no
representations or promises with respect to the Building or demised premises
except as herein expressly set forth.
ARTICLE 36
NAME OF THE BUILDING PROJECT
<PAGE> 59
36.1 Landlord shall have the full right at any time to name or
change the name of the Building Project or the Building and to change the
designated address of the Building Project or the Building.
ARTICLE 37
RESTRICTIONS UPON USE
37.1 It is expressly understood that no portion of the demised
premises shall be used as, by or for (i) a bank, trust company, savings bank,
industrial bank, savings and loan association or personal loan bank (or any
branch office or public accommodation office of any of the foregoing), or (ii) a
public stenographer or typist, barber shop, beauty shop, beauty parlor or shop,
telephone or telegraph agency, telephone or secretarial service, messenger
service, travel or tourist agency, employment agency, public restaurant or bar,
commercial document reproduction or offset printing service, public vending
machines, retail, wholesale or discount shop for sale of merchandise, retail
service shop, labor union, school or classroom, governmental or
quasi-governmental bureau, department or agency, including an autonomous
governmental corporation, an advertising agency, a firm whose principal business
is real estate brokerage, or a company engaged in the business of renting office
or desk space.
ARTICLE 38
INDEMNITY
38.1 Tenant shall indemnify, defend and save Landlord harmless
from and against any liability or expense (including, without limitation,
reasonable attorneys fees and expenses) arising from the use or occupation of
the demised premises by Tenant or anyone in the demised premises with Tenant's
permission, or from the breach of this Lease by Tenant, unless the liability or
expense results from the reckless conduct or negligent acts or omissions of
Landlord, its employees, agents or contractors.
ARTICLE 39
SECURITY DEPOSIT
39.1 Upon the Commencement Date, Tenant shall deposit with
Landlord the sum of Fifty-Nine Thousand Fifteen 00/100
<PAGE> 60
Dollars ($59,015.00)* as security for the faithful performance and observance by
Tenant of the terms, provisions and conditions of this Lease. Said sum shall be
deposited in an interest bearing account, and the interest shall be paid
annually to Tenant, provided that Tenant is not in material default hereunder
beyond any applicable notice and grace periods. It is agreed that in the event
Tenant defaults beyond applicable grace periods in respect of any of the terms,
provisions and conditions of this Lease, including, but not limited to, payment
of fixed annual rent and additional rent, Landlord may use, apply or retain the
whole or any part of the security so deposited to the extent required for the
payment of any rent and additional rent or any other sum as to which Tenant is
in default or for any sum which Landlord may expend or may be required to expend
by reason of Tenant's default in respect of any of the terms, covenants and
conditions of this Lease, including but not limited to, any damages or
deficiency in the reletting of the demised premises, whether such damages or
deficiency accrued before or after summary proceedings or other re-entry by
Landlord. In the event that Tenant shall fully and faithfully comply with all of
the terms, provisions, covenants and conditions of this Lease, the security
shall be returned to Tenant at the expiration of this Lease.
39.2 THIS SECTION HAS BEEN INTENTIONALLY DELETED.
39.3 In the event of a sale of the Building or leasing,
conveyance or transfer of the Building, Landlord shall have the right to
transfer the security to the vendee, lessee or transferee and Landlord shall
thereupon be released by Tenant from all liability for the return of such
security; and Tenant agrees to look to the new Landlord solely for the return of
said security; and it is agreed that the provisions hereof shall apply to every
transfer or assignment made of the security to a new Landlord. Tenant further
covenants that it will not assign or encumber or attempt to assign or encumber
the monies deposited herein as security and that neither Landlord nor its
successors or assigns shall be bound by any such assignment, encumbrance,
attempted assignment or attempted encumbrance.
ARTICLE 40
MISCELLANEOUS
40.1 Irrespective of the place of execution or
- --------
* Four Months Rent.
<PAGE> 61
performance, this Lease shall be governed and construed in accordance with the
laws of the State of New York.
40.2 This Lease shall be construed without regard to any
presumption or other rule requiring construction against the party causing this
Lease to be drafted.
40.3 Except as otherwise expressly provided in this Lease,
each covenant, agreement, obligation or other provision of this Lease on
Tenant's part to be performed shall be deemed and construed as a separate and
independent covenant of Tenant, not dependent on any other provision of this
Lease.
40.4 All terms and words used in this Lease, regardless of the
number or gender in which they are used, shall be deemed to include any other
number and any other gender as the context may require.
40.5 Time shall be of the essence with respect to the exercise
of any option granted under this Lease.
40.6 Except as otherwise provided herein whenever payment of
interest is required by the terms hereof it shall be at the Interest Rate.
40.7 In the event that Tenant is in arrears in payment of
fixed annual rent or additional rent hereunder, Tenant waives Tenant's right, if
any, to designate the items against which any payments made by Tenant are to be
credited, and Tenant agrees that Landlord may apply any payments made by Tenant
to any items it sees fit, irrespective of and notwithstanding any designation or
request by Tenant as to the items against which any such payments shall be
credited.
40.8 Landlord or Landlord's agents have made no
representations or promises with respect to the Building Project or the demised
premises except as herein expressly set forth and no rights, easements or
licenses are acquired by Tenant by implication or otherwise except as expressly
set forth herein. Landlord makes no representation as to the actual rentable
square foot area of the demised premises, the Building, or the other
improvements at the Building Project. By the execution of this Lease, Tenant
hereby accepts possession of the demised premises in the condition in which it
exists on the date hereof "as is" and further agrees that, except as expressly
provided herein, Landlord shall have no obligation to perform any work or make
any installations in order to prepare the demised premises for Tenant's
occupancy. The execution of this lease by Tenant shall be conclusive evidence as
against Tenant, that, on the date hereof, the demised premises and the Building
were in good and satisfactory condition.
<PAGE> 62
40.9 Tenant represents, warrants and covenants that:
(a) Tenant is not an employee benefit plan as defined in
Section 3(3) of the Employee Retirement Income Security Act of 1974, as
amended ("ERISA"), which is subject to Title I of ERISA, nor a plan as
defined in Section 4975(e)(1) of the Internal Revenue Code of 1986, as
amended (each of the foregoing hereinafter referred to collectively as
a "Plan"), nor is Tenant an entity whose assets constitute "plan
assets" of one or more such Plans within the meaning of Department of
Labor Regulation Section 2510.3-101;
(b) Neither Tenant nor any of its affiliates (within the
meaning of Part V(c) of Prohibited Transaction Exemption 84-14 granted
by the United States Department of Labor ("PTE 84-14")) has, or during
the immediately preceding year has exercised, the authority to appoint
or terminate The Prudential Insurance Company of America ("Prudential")
as investment manager of any assets of the employee benefit plans whose
assets are held by Prudential or to negotiate the terms of any
management agreement with Prudential on behalf of any such plan;
(c) Tenant is not a related party of Prudential within the
meaning of Part V(h) of PTE 84-14; and
(d) The representations and warranties in the preceding
subparagraphs (a), (b) and (c) are made for the benefit of the holders
of the mortgages presently encumbering the Building (and their
successors) and shall be deemed to be made for the benefit of such
holders (and their successors). Such representations and warranties
shall not be modified or rescinded without the written consent of such
holders (or their successors).
(e) The execution, delivery and performance by Tenant of this
Lease have been duly authorized by all necessary corporate action.
ARTICLE 41
COMMON AREAS AND PARKING
41.1 Landlord shall provide and shall make available from time
to time within the boundaries of the Land such parking facilities, driveways,
entrances and exits thereto, landscape and planted areas, and other improvements
and facilities, as Landlord shall at any time and from time to time deem
appropriate (all the foregoing being collectively referred to in this Lease as
"COMMON AREAS"). Tenant and its officers, employees, agents, customers and
invitees shall have a nonexclusive right, in common with
<PAGE> 63
Landlord and other tenants and occupants of the Building Project (and their
employees and invitees) and contractors working at the Building Project to whom
Landlord has granted or may hereafter grant rights, to use the Common Areas. The
Common Areas shall at all times be subject to the exclusive control and
management of Landlord, and Landlord shall have the right from time to time to
establish, modify and enforce reasonable rules and regulations with respect to
the Common Areas, and Tenant agrees, after notice thereof, to abide by such
rules and regulations and to cause its officers, employees, agents, customers
and invitees to conform thereto. Landlord shall construct, operate, manage,
equip, repair, landscape, and maintain the Common Areas for their intended
purposes in such manner as Landlord shall, in Landlord's sole discretion, from
time to time determine. Landlord's rights respecting the Common Areas shall
include (but shall not be limited to) the following:
(i) to construct, maintain and operate lighting
facilities serving the Common Areas;
(ii) from time to time to change the area, level, location
and arrangement of parking areas and other Common Area facilities, to
make installations therein and to move or remove such installations,
and to change the location of, or permanently diminish or discontinue
the use of, any portion of the Common Areas provided the number of
parking spaces available for Tenant's use shall not be materially
reduced;
(iii) to restrict parking by tenants, their officers, agents,
employees, customers and invitees, to designated areas;
(iv) to discontinue, or restrict the use of, any portion of
the Common Areas to such extent, and for such period of time, as may in
the opinion of Landlord's counsel be necessary to prevent a dedication
thereof or the accrual of any rights to any person or the public
therein;
(v) to temporarily suspend the use of all, or any portion
of, the Common Areas if required to comply with laws or the
requirements of Landlord's insurers or to make any repairs or
alterations thereto or if necessary in connection with the maintenance
thereof; and
(vi) to take any other action with respect to the Common
Areas, as Landlord, in its sole discretion, shall determine to be
advisable.
41.2 Tenant's right to use the Common Areas shall be deemed to
be an irrevocable license coterminous with the term of this Lease, and Landlord
shall not be subject to any liability
<PAGE> 64
nor shall Tenant be entitled to any compensation or diminution or abatement of
rent by reason of Landlord's exercise of any right or rights respecting Common
Areas reserved pursuant to Section 41.1 hereof, nor shall the exercise of any
such right be deemed a constructive or actual eviction.
41.3 Tenant shall be entitled to free use of a total of
twenty-four (24) parking spaces (twenty (20) unreserved parking spaces in common
with others and four (4) reserved parking spaces within close proximity to the
Building.) Tenant agrees that if Landlord shall designate specific parking
spaces, it or its employees and invitees shall only use such designated parking
spaces. Landlord agrees that it will not designate any such parking spaces in a
discriminatory manner with respect to Tenant.
41.4 With respect to the parking of vehicles at the Building
Project:
(a) If Landlord elects to designate a specific parking area
for Tenant's use, Tenant shall require its personnel and visitors to park their
vehicles only in parking spaces designated by Landlord for Tenant's use for its
personnel and visitors on a "first come, first served" basis. Landlord reserves
the right at all times to redesignate such parking spaces. Tenant, its personnel
and visitors shall not at any time park any trucks or delivery vehicles in any
of the parking areas;
(b) all parking spaces and any other parking areas used by
Tenant, its personnel and visitors will be at their own risk, and Landlord shall
not be liable for any injury to person or property, or for loss or damage to any
automobile or its contents, resulting from theft, collision, vandalism or any
other cause whatsoever;
(c) there shall be no overnight parking and Tenant shall, and
shall cause its personnel and visitors to, remove their automobiles from the
parking area at the end of their working day. If any automobile owned by Tenant
or by its personnel or visitors remains in the parking area overnight and the
same interferes with the cleaning or maintenance of said area (snow or
otherwise), any costs or liabilities incurred by Landlord in removing said
automobile to effectuate cleaning or maintenance, or any damages resulting to
said automobile or to Landlord's equipment or equipment owned by others by
reason of the presence of or removal of said automobile during such cleaning or
maintenance shall be paid by Tenant to Landlord, as additional rent on the rent
payment date next following the submission of a bill therefor; and
(d) Tenant agrees not to use, or permit its employees or
invitees to use, any portion of the parking areas which have
<PAGE> 65
been designated for the exclusive use of another tenant in the Building Project.
ARTICLE 42
EXTENSION OF TERM
42.1 Tenant shall have the right to extend the term of this
Lease for one (1) additional term of one (1) year (the "EXTENSION TERM").
42.2 (a) The Extension Term shall commence upon the day
following the Expiration Date and shall end on the last day of the calendar
month in which occurs the day preceding the fifth (5th) anniversary of the
commencement of the Extension Term. The option contained in this Section 41.2
shall be subject to the following terms and conditions:
(i) Tenant shall give Landlord notice (hereinafter called
the "EXTENSION NOTICE") of its election to extend the term of this
Lease at least nine (9) months prior to the commencement of the
Extension Term;
(ii) Tenant is not in default under the Lease in any material
respect (beyond any applicable grace period) as of the time of the
giving of the Extension Notice and the commencement of the Extension
Term unless Landlord shall waive any such default in writing;
(iii) The Tenant named herein is the actual occupant of not
less than fifty percent (50%) of the usable area of the demised
premises as of the time of the giving of the Extension Notice and the
commencement of the Extension Term; and
(iv) Simultaneous with the giving of the Extension Notice
hereunder, Tenant shall exercise the extension option contained in the
lease of space which adjoins the demised premises.
(b) The fixed annual rent payable by Tenant to Landlord during
the Extension Term shall be the higher of (i) One Hundred Seventy-Seven Thousand
Forty-Five 00/100 Dollars ($177,045.00) per year, or (ii) the then fair market
rent for the demised premises (as determined in accordance with Section 42.4
herein).
42.3 THIS SECTION HAS BEEN INTENTIONALLY DELETED.
42.4 (a) After Landlord receives a notice from Tenant
<PAGE> 66
as specified in Section 42.2(i), it shall make the initial determination of the
fixed annual rent for the Extension Term ("LANDLORD'S SUBMITTED RENT"), which
determination will be Landlord's statement of the then fair market rent (as
defined in Section 42.4(b) hereof) of the demised premises. Landlord shall give
notice to Tenant of Landlord's Submitted Rent within thirty (30) days after
receipt of such notice from Tenant. If Landlord and Tenant shall fail to agree
upon the fixed annual rent for the Extension Term, within thirty (30) days after
delivery of such notice by Landlord, then Landlord and Tenant each shall give
notice to the other setting forth the name and address of an arbitrator
designated by the party giving such notice. If either party shall fail to give
notice of such designation within ten (10) Business Days of the end of such
thirty (30) day period, then the arbitrator chosen shall make the determination
alone. If two arbitrators shall have been designated, within thirty (30) days
thereafter such two arbitrators shall make their determinations of fixed annual
fair market rent, as defined in Section 42.4(b), for the Extension Term, in
writing and give notice thereof to each other and to Landlord and Tenant. Such
two arbitrators shall have thirty (30) days after the receipt of notice of each
other's determinations to confer with each other and to attempt to reach
agreement as to the determination of fixed annual rent for the Extension Term.
If such two arbitrators shall concur as to the determination of such fixed
annual rent, such concurrence shall be final and binding upon Landlord and
Tenant. If such two arbitrators shall fail to concur, then such two arbitrators
shall immediately designate a third arbitrator. If the two arbitrators shall
fail to agree upon the designation of such third arbitrator within five (5)
days, then either party may apply to the American Arbitration Association or any
successor thereto having jurisdiction for the designation of such arbitrator.
All arbitrators shall be real estate appraisers or consultants who shall have
had at least ten (10) years continuous experience in the business of appraising
or managing real estate or acting as real estate agents or brokers in the County
of Westchester and shall not be affiliated with Landlord or Tenant. The third
arbitrator shall conduct such hearings and investigations as he may deem
appropriate and shall, within thirty (30) days after his designation, choose one
of the determinations of the two arbitrators originally selected by the parties,
and that choice by the third arbitrator shall be binding upon Landlord and
Tenant. Each party shall pay its own counsel fees and expenses, if any, in
connection with any arbitration under this Section, including the expenses and
fees of any arbitrator selected by it in accordance with the provisions of this
Section, and the parties shall share equally all other expenses and fees of any
such arbitration. The determination rendered in accordance with the provisions
of this Section shall be final and binding in fixing the fixed annual rent for
the Extension Term. The arbitrators shall not have the power to add to, modify
or change
<PAGE> 67
any of the provisions of this Lease.
(b) "FAIR MARKET RENT" for purposes of this Article 42 shall
mean the rental rate that would be paid in an arms-length transaction between a
landlord who is under no compulsion to lease and a tenant who is under no
compulsion to rent the premises in question, based upon the rental market for
comparable premises in comparable buildings in Westchester County under terms
(other than those pertaining to the payment of fixed annual rent) similar to
those in this Lease.
(c) Prior to the determination of the arbitrators, Tenant
shall pay as the fixed annual rent for the Extension Term, the fixed annual rent
payable for the immediately preceding term, and in the event the arbitrators
determine that the fixed annual rent payable pursuant to this Section 42.4 is
more than that being paid by Tenant, then Tenant shall pay the amount of such
underpayment, with interest thereon at the Interest Rate, within thirty-five
(35) days after the arbitrators' determination.
(d) For the purposes of facilitating the computations of sums
due for fair market rent pursuant to Section 42.4(b): the sums payable pursuant
to Articles 3 and 4, as calculated on a per square foot basis, for the Lease
Year immediately preceding the commencement of the Extension Term shall be
subtracted from the gross fixed annual rent for the Extension Term determined
pursuant to this Section 42.4, as calculated on a per square foot basis; and in
computing escalations with respect to such space under Articles 3 and 4 hereof
the Land Tax Base Factor, the Building Tax Base Factor, the Building Expense
Base Factor and the Non-Building Expense Base Factor shall remain unchanged.
42.5 Except as provided in Section 42.2 hereof, Tenant's
occupancy of the demised premises during the Extension Term shall be on the same
terms and conditions as are in effect immediately prior to the commencement of
the Extension Term, provided, however, that upon the expiration of the Extension
Term Tenant shall have no further right to extend the term of this Lease and
Landlord shall not be required to perform any work to prepare the demised
premises for Tenant's occupancy.
42.6 If Tenant does not send an Extension Notice pursuant to
provisions of Section 42.2, this Article 42 hereof shall have no force or effect
and the term of this Lease shall expire on the last day of the initial term
hereof. At such time as Tenant exercises its option pursuant to this Article 42,
Landlord or Tenant can request the other party hereto to execute an instrument
setting forth the exercise of Tenant's right to extend the term of this Lease
and the last day of the Extension Term.
42.7 At such time as Tenant exercises its right to
<PAGE> 68
extend the term of this Lease as herein provided, the phrases "the term of this
Lease" or "the term hereof" as used in this Lease, shall be construed to
include, when practicable, the Extension Term.
IN WITNESS WHEREOF, Landlord and Tenant have respectively
executed this Lease as of the day and year first above written.
PURCHASE CORPORATE PARK
ASSOCIATES, L.P., Landlord
By: PCPA, LLC, the General Partner
By: /s/ Warren L. Schwerin
---------------------------------
Warren L. Schwerin,
a Co-Managing Member
INTERLIANT, INC., Tenant
By: /s/ Leonard Fassler
---------------------------------
Name: Leonard Fassler
Title: Co-Chairman
<PAGE> 69
EXHIBIT A
SITE PLAN
<PAGE> 70
EXHIBIT B
DESCRIPTION OF LAND
All that certain plot, piece or parcel of land, situate, lying
and being in the Town/Village of Harrison, County of Westchester and State of
New York, being a 42.642 Acre Parcel of land shown and delineated on Map Number
20975 filed in the Office of the Clerk of Westchester County (Division of Land
Records) on July 26th, 1982; said parcel also being a portion of Parcels "C" and
"D" as shown on Map Number 19488 filed in the Office of the Clerk of Westchester
County (Division of Land Records) on May 22nd, 1978, being more particularly
bounded and described as follows:
BEGINNING at a point on the northeasterly side of Route I-684
where the same is intersected by the southerly line of land now or formerly of
Whitelaw Reid, said point being the northwesterly corner of Parcel "C" as shown
on Filed Map No.
19488;
running thence along said land of Whitelaw Reid, the following
courses and distances:
North 72(degree) 13' 05" East 321.205 feet,
North 84(degree) 509' 40" East 333.53 feet,
North 44(degree) 11' 00" East 453.19 feet,
North 48(degree) 58' 00" East 29.71 feet,
North 65(degree) 11' 30" East 200.54 feet and
North 65(degree) 51' 30" East 56.95 feet to the
division line between Parcel "C" and Parcel "F" and the southwesterly corner of
said Parcel "F" as shown on Filed Map No. 19488;
thence easterly along said division line along a curve to the
right having a radius of 600.00 feet, the radial of which at its westerly end
bears North 14(degree) 00' 31" West, said curve having a central angle
22(degree) 38' 22" a distance of 237.079 feet to the division line between
Parcel "B" and Parcel "C" as shown on Filed Map No. 19488;
thence along said division line, South 2(degree) 52' 00" West
720.135 feet to the division line between Parcel "C" and Parcel "B";
thence along said division line, commencing in a northerly
direction along a curve to the left having a radius of 70.00 feet, a central
angle of 271(degree) 27' 23", a distance of 331.65 feet to a point of reverse
curve;
thence along a curve to the right having a radius of 50.00
feet, a central angle of 48(degree) 11' 23" a distance of 42.05 feet to a point
of tangency;
<PAGE> 71
thence continuing along the division line between Parcel "C"
and Parcel "B", South 40(degree) 24' 00" East 693.099 feet to a point of curve;
thence along a curve to the right having a radius of 50.00
feet, a central angle of 64(degree) 21' 26" a distance of 56.162 feet to a
point, said point being a non-tangent intersection on Parcel 228 as shown on
Filed Map No. 20781;
thence along the highway right-of-way, as established per said
filed Map No. 20781 as follows: In a southwesterly direction along a curve to
the left having a radius of 751.20 feet a central angle of 9(degree) 29' 38" a
distance of 124.473 feet to a point of tangency;
South 33(degree) 30' 33" West 447.23 feet,
South 57(degree) 19' 19" West 23.62 feet,
South 72(degree) 58' 51" West 78.52 feet, and
South 67(degree) 39' 54" West 138.766 feet to a non-tangent
intersection with the division line between Parcel "C" and Parcel "D" as shown
on Filed Map No. 19488;
thence along said division line in a northwesterly direction
along a curve to the right having a radius of 400.00 feet, a central angle of
19(degree) 46' 54" a distance of 138.101 feet to a point of tangency and
northeasterly side of Route I-684;
thence along the northeasterly side of Route I-684, the
following courses and distances:
North 63(degree) 19' 08" West 462.679 feet,
South 45(degree) 59' 00" West 593.505 feet,
South 45(degree) 30' 27" West 138.225 feet, and
South 23(degree) 35' 05" West 535.16 feet, to the point and
place of Beginning.
<PAGE> 72
EXHIBIT C
FLOOR PLAN
<PAGE> 73
EXHIBIT D
THIS EXHIBIT HAS BEEN INTENTIONALLY DELETED.
<PAGE> 74
EXHIBIT E
HVAC SPECIFICATIONS
H.V.A.C.:
Year round air conditioning systems capable of providing and maintaining design
criteria as follows:
Design Condition Inside Condition Outside Condition
Cooling Cycle 76 degr. D.B.F. 90 degr. D.B.F.
50% R.H. 77 degr. W.B.F.
Heating Cycle 65 degr. F. 0 degr. F.
These design standards are based on an occupancy of not more than one (1) person
per 150 square feet and a total connected load not to exceed 3 watts per square
foot for lighting and standard electrical office power, all in accordance with
State and Federal regulations.
The system shall be designed to furnish not less than .05 cubic feet per minute
of fresh air and not less than 1.0 cubic feet per minute of total supply air per
square foot of the premises.
The air conditioning system shall combine use of periphery heating and one (1)
variable volume air conditioning control unit per 1,500 square feet with ceiling
diffusers and thermostatic controls.
<PAGE> 75
EXHIBIT F
CLEANING SPECIFICATIONS
FOR
THE CENTRE AT PURCHASE
GENERAL OFFICE AND PUBLIC AREAS
Daily
1. Sweep or dry mop all resilient tile and wood floors; remove gum, tar,
etc. adhering to floors.
2. Empty and damp wipe all ashtrays.
3. Empty and damp wipe waste baskets.
4. Remove trash to designated area.
5. Dust all horizontal surfaces with treated dust cloths; this includes
furniture, files, equipment, blinds, louvers, etc. that can be reached
without use of a ladder.
6. Damp wipe with germicidal solutions all telephones (including dials and
crevices).
7. Spot clean to remove smudges, marks and fingerprints from walls,
equipment, doors, partitions, light switches, etc. within reach.
8. Wash chalk boards as requested by tenants.
9. Wash water fountains with germicidal solution.
10. Wash cafeteria tables and chairs.
11. Damp mop all non resilient floors such as terrazzo, ceramic tile,
quarry, tile, etc.
12. Thoroughly clean all elevator cabs and landing doors.
13. Clean lobby entrance doors and glass.
14. Turn off all lights when areas have been cleaned.
Weekly
1. Wash glass in display windows, building directory, entrance doors and
show windows, both sides.
<PAGE> 76
2. Spot clean interior partitions and desk glass to remove smudge marks.
3. Sweep all stair areas.
4. Scrub and recondition resilient tile floors.
5. Brush all fabric covered chairs with lint brush.
6. Vacuum three times weekly.
Monthly
1. Scrub and recondition resilient tile floors using buffable non slip
floor finish.
2. Vacuum all ceiling and wall air supply and exhaust diffusers and
grills.
3. Wash all stairwell landing and treads.
Quarterly
1. High dust all horizontal and vertical surfaces not reached in nightly
cleaning such as pipes, light fixtures, door frames, picture frames,
etc.
2. Vacuum or dust all books in place.
3. Wash and polish vertical terrazzo or marble surfaces.
4. Damp wipe diffusers, vents, grills, etc., including surrounding wall or
ceiling areas that are soiled.
Semi-Annually
1. Wash exterior windows.
Annually
1. Wash light fixtures including reflectors, globes, diffusers and trim.
2. Wash walls in corridors, lobbies and cafeteria.
3. Clean all vertical surfaces not attended to in nightly, weekly, monthly
or quarterly schedules.
<PAGE> 77
RESTROOMS
Daily
1. Clean mirrors, soap dispensers, shelves, basins, exposed plumbing,
dispensers and disposal units using disinfectant solution.
2. Damp wipe all ledges, toilet stalls and doors.
3. Spot clean light switches, doors and walls.
4. Thoroughly clean commodes and urinals with disinfectant solution.
5. Pour one ounce of bowl cleaner into bowls and urinals when finished
cleaning. Do not flush.
6. Remove all trash to designated area.
7. Refill all soap, toilet tissue and towel and other dispensers.
8. Damp mop tile floors with disinfectant solution.
9. Clean all baseboards.
Weekly
1. Brush all fabric covered chairs and couches in the Ladies lounges with
a lint brush.
Monthly
1. Vacuum all ceiling and wall air supply and exhaust units.
Quarterly
1. High dust all horizontal and vertical surfaces not reached in nightly
cleaning.
2. Damp wash diffusers, vents and grills.
Annually
1. Wash light fixtures.
2. Wash walls with disinfectant solution.
3. Machine scrub floors using disinfectant solutions.
<PAGE> 78
EXHIBIT G
RULES AND REGULATIONS
1. The sidewalks and public portions of the Building, such as
entrances, passages, courts, elevators, vestibules, stairways, corridors or
halls shall not be obstructed or encumbered by any tenant or used for any
purpose other than ingress and egress to and from the demised premises.
2. No awnings or other projections shall be attached to the
outside walls of the Building. No curtains, blinds, shades, louvered openings or
screens shall be attached to or hung in, or used in connection with, any window
or door of the demised premises, without the prior written consent of Landlord,
unless installed by Landlord.
3. Except as provided in the Lease, no sign, advertisement,
notice or other lettering shall be exhibited, inscribed, painted or affixed by
any tenant on any part of the outside of the demised premises or Building or on
corridor walls. Signs on entrance door or doors shall be subject to Landlord's
approval which shall not be unreasonably withheld. Signs on doors shall, at the
tenant's expense, be inscribed, painted or affixed for each tenant by sign
makers approved by Landlord, which approval shall not be unreasonably withheld.
In the event of the violation of the foregoing by any tenant, Landlord may
remove same without any liability, and may charge the expense incurred by such
removal to the tenant or tenants violating this rule.
4. The sashes, sash doors, skylights, windows, heating,
ventilating and air conditioning vents and door that reflect or admit light and
air into the halls, passageways or other public places in the Building shall not
be covered or obstructed by any tenant, nor shall any bottles, parcels, or other
articles be placed outside of the demised premises.
5. No show cases or other articles shall be put in front of or
affixed to any part of the exterior of the Building, nor placed in the public
halls, corridors or vestibules without the prior written consent of Landlord.
6. Intentionally omitted.
7. The water and wash closets and other plumbing fixtures
shall not be used for any purposes other than those for which they were
constructed, and no sweepings, rubbish, rags, or other substances shall be
thrown therein. All damages resulting from any misuse of the fixtures shall be
borne by the tenant who,
<PAGE> 79
or whose servants, employees, agents, visitors or licensees, shall have caused
the same.
8. No tenant shall in any way deface any part of the demised
premises or the Building of which they form a part. No tenant shall lay
linoleum, or other similar floor covering, so that the same shall come in direct
contact with the floor of the demised premises, and, if linoleum or other
similar floor covering is desired to be used, an interlining of builder's
deadening felt shall be first affixed to the floor, by a paste or other
material, soluble in water, the use of cement or other similar adhesive material
being expressly prohibited.
9. No bicycles, vehicles or animals of any kind (except seeing
eye dogs) shall be brought into or kept in or about the premises. No cooking
shall be done or permitted by Tenant in the demised premises except in
conformity to law and then only in the utility kitchen, if any, as set forth in
Tenant's layout, which is to be primarily used by Tenant's employees for heating
beverages and light snacks. No tenant shall cause or permit any unusual or
objectionable odors to be produced upon or permeate from the demised premises.
10. No space in the Building shall be used for the
manufacturing or distribution or for the storage of merchandise or for the sale
at auction or manufacture, or otherwise of merchandise, goods or property of any
kind.
11. No tenant shall make, or permit to be made, any unseemly
or disturbing noises or disturb or interfere with occupants of the Building or
neighboring buildings or premises or those having business with them, whether by
the use of any musical instrument, radio, talking machine, unmusical noise,
whistling, singing, or in any other way. No tenant shall throw anything out of
the doors, or windows or down the passageways.
12. No tenant, nor any of the tenant's servants, employees,
agents, visitors or licensees, shall at any time bring or keep upon the demised
premises any inflammable, combustible or explosive fluid, or chemical substance,
other than reasonable amounts of cleaning fluids, reproduction fluids and
solvents required in the normal operation of tenant's business offices.
13. No additional locks or bolts of any kind shall be placed
upon any of the doors or windows by any tenant, nor shall any changes be made in
existing locks or the mechanism thereof, without the prior written approval of
the Landlord and unless and until a duplicate key is delivered to Landlord,
except with respect to security areas so designated by Tenant, which shall in no
event exceed five percent (5%) of the rentable area of the demises premises.
Each tenant must, upon the termination of his tenancy, restore to the Landlord
all keys of stores, offices and toilet rooms, either furnished to, or otherwise
procured by, such
<PAGE> 80
tenant, and in the event of the loss of any keys, so furnished, such tenant
shall pay to Landlord the cost thereof.
14. All removals, or the carrying in or out of any safes,
freight, furniture or bulky matter of any description must take place during the
hours which Landlord or its agent may determine from time to time. Landlord
reserves the right to inspect all freight to be brought into the Building and to
exclude from the Building all freight which violates any of these Rules and
Regulations or the Lease of which these Rules and Regulations are a part.
15. Intentionally omitted.
16. Landlord shall have the right to prohibit any advertising
by any tenant mentioning the Building which, in Landlord's reasonable opinion,
tends to impair the reputation of the Building or its desirability as a building
for offices, and upon written notice from Landlord, tenants shall refrain from
or discontinue such advertising.
17. In order that the Building can and will maintain a uniform
appearance to those outside of same, each tenant in building perimeter areas
shall (a) use only building standard lighting in areas where lighting is visible
from the outside of the Building and (b) use only building standard venetian or
vertical blinds in window areas which are visible from the outside of the
Building.
18. Landlord reserves the right to exclude from the Building
between the hours of 6:30 p.m. and 7:30 a.m. and at all hours on non-business
days all persons who do not present a pass to the Building signed by a tenant.
Each tenant shall be responsible for all persons for whom such pass is issued
and shall be liable to Landlord for all acts of such persons.
19. The premises shall not be used for lodging or sleeping or
for any immoral or illegal purpose.
20. The requirements of tenants will be attended to only upon
application at the office of the Building. Building employees shall not perform
any work or do anything outside of their regular duties, unless under special
instructions from the office of the Landlord.
21. Intentionally omitted.
22. Canvassing, soliciting and peddling in the Building are
prohibited and each tenant shall cooperate to prevent the same.
23. There shall not be used in any space, or in the
<PAGE> 81
public halls of any building, either by any tenant or by jobbers or others, in
the delivery or receipt of merchandise, any hand trucks, except those equipped
with rubber tires and side guards. No hand trucks shall be used in passenger
elevators which have not been prepared for use to carry freight.
24. Tenants, in order to obtain maximum effectiveness of the
cooling system, shall lower and/or close venetian or vertical blinds or drapes
when sun's rays fall directly on windows of demised premises.
25. After the initial work, replacement of ceiling tiles after
they are removed for Tenant by telephone company installers, in the public
corridors, will be charged to Tenant on a per tile basis.
Whenever and to the extent that the above rules conflict with
any of the rights or obligations of Tenant pursuant to the provisions of the
Articles of this Lease, the provisions of the Articles shall govern.
<PAGE> 82
EXHIBIT H
THIS EXHIBIT HAS BEEN INTENTIONALLY DELETED.
<PAGE> 1
Exhibit 10.30
- --------------------------------------------------------------------------------
AGREEMENT OF LEASE
between
PURCHASE CORPORATE PARK ASSOCIATES, L.P.
Landlord,
and
INTERLIANT, INC.
Tenant,
Dated: June 16, 1999
PREMISES:
THE CENTRE AT PURCHASE
TWO MANHATTANVILLE ROAD
PURCHASE, NEW YORK
A portion of the 1st Floor
- --------------------------------------------------------------------------------
<PAGE> 2
Interliant-III
<PAGE> 3
<TABLE>
<CAPTION>
TABLE OF CONTENTS
Page
----
<S> <C>
ARTICLE 1 PREMISES, COMMENCEMENT OF TERM, TERM AND RENT.................................................. 1
ARTICLE 2 LAYOUT AND FINISH.............................................................................. 3
ARTICLE 3 TAX ESCALATION................................................................................. 5
ARTICLE 4 EXPENSE ESCALATION.............................................................................10
ARTICLE 5 USE............................................................................................17
ARTICLE 6 ALTERATIONS AND INSTALLATIONS..................................................................18
ARTICLE 7 REPAIRS........................................................................................21
ARTICLE 8 REQUIREMENTS OF LAW............................................................................23
ARTICLE 9 INSURANCE, LOSS, REIMBURSEMENT, LIABILITY......................................................24
ARTICLE 10 LANDLORD'S LIABILITY...........................................................................26
ARTICLE 11 ASSIGNMENT, MORTGAGING, SUBLETTING, ETC........................................................27
ARTICLE 12 ELECTRICITY....................................................................................31
ARTICLE 13 DAMAGE BY FIRE OR OTHER CAUSE..................................................................34
ARTICLE 14 CONDEMNATION...................................................................................36
ARTICLE 15 ACCESS TO DEMISED PREMISES; CHANGES............................................................37
ARTICLE 16 DEFAULT........................................................................................38
ARTICLE 17 RE-ENTRY BY LANDLORD, INJUNCTION...............................................................40
ARTICLE 18 DAMAGES........................................................................................41
ARTICLE 19 LANDLORD'S RIGHT TO PERFORM TENANT'S OBLIGATIONS...............................................43
ARTICLE 20 QUIET ENJOYMENT................................................................................44
ARTICLE 21 SERVICES AND EQUIPMENT.........................................................................44
ARTICLE 22 DEFINITIONS....................................................................................47
ARTICLE 23 INVALIDITY OF ANY PROVISION....................................................................48
ARTICLE 24 BROKERAGE......................................................................................48
</TABLE>
<PAGE> 4
<TABLE>
<S> <C>
ARTICLE 25 SUBORDINATION..................................................................................49
ARTICLE 26 CERTIFICATES OF LANDLORD AND TENANT............................................................50
ARTICLE 27 LEGAL PROCEEDINGS WAIVER OF JURY TRIAL.........................................................52
ARTICLE 28 SURRENDER OF PREMISES..........................................................................52
ARTICLE 29 RULES AND REGULATIONS..........................................................................53
ARTICLE 30 CONSENTS AND APPROVALS.........................................................................53
ARTICLE 31 NOTICES........................................................................................54
ARTICLE 32 NO WAIVER......................................................................................55
ARTICLE 33 CAPTIONS.......................................................................................56
ARTICLE 34 INABILITY TO PERFORM...........................................................................56
ARTICLE 35 NO REPRESENTATIONS BY LANDLORD.................................................................56
ARTICLE 36 NAME OF THE BUILDING PROJECT...................................................................56
ARTICLE 37 RESTRICTIONS UPON USE..........................................................................56
ARTICLE 38 INDEMNITY......................................................................................57
ARTICLE 39 SECURITY DEPOSIT...............................................................................57
ARTICLE 40 MISCELLANEOUS..................................................................................58
ARTICLE 41 COMMON AREAS AND PARKING.......................................................................60
ARTICLE 42 EXTENSION OF TERM..............................................................................62
ARTICLE 43 EARLY TERMINATION..............................................................................65
EXHIBITS
EXHIBIT A SITE PLAN.....................................................................................A-1
EXHIBIT B DESCRIPTION OF LAND...........................................................................C-1
EXHIBIT C FLOOR PLAN....................................................................................C-1
EXHIBIT D THIS EXHIBIT HAS BEEN INTENTIONALLY DELETED...................................................D-1
EXHIBIT E HVAC SPECIFICATIONS...........................................................................E-1
EXHIBIT F CLEANING SPECIFICATIONS.......................................................................F-1
EXHIBIT G RULES AND REGULATIONS.........................................................................G-1
EXHIBIT H THIS EXHIBIT HAS BEEN INTENTIONALLY DELETED...................................................H-1
</TABLE>
<PAGE> 5
SoGen Space
AGREEMENT OF LEASE made as of this 16th day of June, 1999,
between PURCHASE CORPORATE PARK ASSOCIATES, L.P., a New York limited partnership
having an office at Two Manhattanville Road, Purchase, New York 10577
(hereinafter referred to as "LANDLORD") and INTERLIANT, INC., a Delaware
corporation having an office at 11 Martine Avenue, 12th Floor, White Plains, New
York 10606 (hereinafter referred to as "TENANT").
W I T N E S S E T H :
Landlord and Tenant hereto, for themselves, their heirs,
distributees, executors, administrators, legal representatives, trustees,
successors and assigns, hereby covenant and agree as follows:
ARTICLE 1
PREMISES, COMMENCEMENT OF TERM, TERM AND RENT
1.1 Landlord hereby leases to Tenant and Tenant hereby hires
from Landlord, subject to any ground leases and/or underlying leases and/or
mortgages as hereinafter provided, and upon and subject to the covenants,
agreements, terms, provisions and conditions of this Lease, in the building
designated Building A/B on the site plan annexed hereto as EXHIBIT A
(hereinafter referred to as the "BUILDING") on land (the "LAND") located in the
Town of Harrison, County of Westchester, State of New York and as more
particularly described in EXHIBIT B annexed hereto, in the office park commonly
known as "THE CENTRE AT PURCHASE", the following space: a portion of the first
(1st) floor designated on EXHIBIT C annexed hereto (the "DEMISED PREMISES"). The
term of this Lease shall commence on the date hereof (hereinafter referred to as
the "COMMENCEMENT DATE") and shall end on June 30, 2004 (hereinafter referred to
as the "EXPIRATION DATE") or until such term shall earlier cease and terminate
as hereinafter provided.
1.2 Tenant shall pay to Landlord a fixed annual rent ("FIXED
ANNUAL RENT") commencing on the date that is the earlier to occur of: (i) one
(1) month from the execution hereof or (ii) the date Tenant, or anyone claiming
under or through Tenant, first occupies the demised premises for the conduct of
its business (the "RENT COMMENCEMENT DATE"):
One Hundred Nineteen Thousand Two and 00/100 Dollars
<PAGE> 6
($119,002.00) per year, for the period commencing on July 1, 1999 and ending on
May 31, 2000;
One Hundred Twenty-Three Thousand Five Hundred Seventy-Nine and 00/100
Dollars ($123,579.00) per year for the period commencing on June 1, 2000 and
ending on May 31, 2002; and
One Hundred Thirty Thousand Four Hundred Forty-Four and 50/100 Dollars
($130,444.50) per year for the period commencing on June 1, 2002 and ending on
the Expiration Date.
Tenant agrees to pay the fixed annual rent in lawful money of
the United States of America, in equal monthly installments in advance on the
first day of each calendar month during the term of this Lease, at the office of
Landlord or such other place in the United States of America as Landlord may
designate, without any setoff or deduction whatsoever, except such deduction as
may be occasioned by the occurrence of any event permitting or requiring a
deduction from or abatement of rent as specifically set forth in Articles 13 and
14 hereof.
1.3 Tenant shall pay the fixed annual rent and additional rent
as above and as hereinafter provided, by good and sufficient check (subject to
collection) drawn on a bank which is a member of the New York Clearinghouse
Association or another bank approved in writing by Landlord. Tenant is paying
the first month's rent upon the execution hereof. If the Rent Commencement Date
shall occur on a day other than the first (1st) of a calendar month, the fixed
rent for such calendar month shall be prorated and the balance of the first
(1st) month's rent previously paid shall be credited against the next monthly
installment of fixed rent. Tenant shall pay fixed annual rent and the monthly
payments set forth in Section 4.4(b)(i) shall be paid when due in accordance
with the terms of this Lease. All other sums payable by Tenant hereunder shall
be payable within ten (10) days after written demand for same, unless other
payment dates are hereinafter provided. All sums other than fixed annual rent
payable by Tenant hereunder shall be deemed additional rent, the default in the
payment of which Landlord shall have the same remedies as for a default in the
payment of fixed annual rent.
1.4 If Tenant shall fail to pay when due any installment of
fixed annual rent for a period of ten (10) days after written notice is given to
Tenant that such installment shall have become due, or if Tenant shall fail to
pay any payment of additional rent for a period of ten (10) days after written
notice is given to Tenant that such payment shall have become due, then without
regard to any other remedies which Landlord may have as a consequence of such
default, Tenant shall pay interest thereon at the "INTEREST RATE" (as such term
is defined in Article 22 hereof), from the date when such installment shall have
become due or notice of such additional rent being due is
<PAGE> 7
given (as the case may be) to the date of the payment thereof, and such interest
shall be deemed additional rent.
ARTICLE 2
LAYOUT AND FINISH
2.1 Tenant, at Tenant's cost and expense, and in a
professional and workmanlike manner, shall make and complete the work and
installations in and to the demised premises set forth below in such manner so
that the demised premises will be executive, general and administrative offices
appropriate for a first class office building in Westchester County, New York.
Tenant, at Tenant's expense, shall cause to be prepared a
preliminary plan or set of plans (which said plan or set of plans, as the case
may be, are hereinafter called the "plan") which shall contain information
relating to the construction of the demised premises and the engineering in
connection therewith and any effect on building systems. The plan shall be
submitted by Tenant to Landlord for Landlord's approval, which approval shall
not unreasonably withheld or delayed and shall be based solely upon (i) the
effect of "Tenant's Work", as defined below, upon the A/B Building engineering
specifications and systems, (ii) potential for interference with the rights of
other tenants, (iii) compliance of the plan with Legal Requirements (but
Landlord's approval of the plan shall in no way be deemed a representation that
such plans comply with Legal Requirements and (iv) the effect of Tenant's Work
(as hereinafter defined) on the structure of the A/B Building (i.e., Tenant's
Work must not be structural in nature). If Landlord shall disapprove the plan,
Landlord shall set forth its reasons for such disapproval and itemize those
portions of the plan so disapproved. Landlord shall review and respond to
Tenant's plans within seven (7) days of its receipt of a set of detailed plans
and specifications and such other information as Landlord or its agents shall
reasonably (and promptly) request. In the event that Landlord fails to reject
such plans within said seven (7) day period, giving explicit reasons for such
rejection, Tenant's Plans shall be deemed approved. In the event that Landlord
timely refuses to consent to such plans as set forth above, Tenant shall
resubmit the changed plans and Landlord will then have five (5) days from its
receipt of the changed plans and specifications to approve or reject such plans,
using the criteria set forth above. In the event that Landlord fails to reject
such plans within said five (5) day period, giving explicit reasons for such
rejection, Tenant's Plans shall be deemed approved. If Landlord still rejects
such plans, the same procedure shall be used until Landlord's consent is
obtained. Landlord shall not be deemed unreasonable in withholding its consent
to the extent that the plan prepared by Tenant pursuant hereto involves the
performance
<PAGE> 8
of work or the installation in the demised premises of materials or
equipment which do not equal or exceed the standard of quality adopted by
Landlord for the Building.
Tenant shall have the right to revise the plan, provided
Tenant has received Landlord's prior written consent to such revision. Final
plans will be delivered to Landlord as they become available, for Landlord's
approval pursuant to this Section 2.1. Subject to Landlord's review of the
plans, Tenant shall not be required to remove Tenant's Work upon the expiration
of this Lease.
2.2 The following conditions shall also apply to Tenant's
Work:
(a) Tenant, at Tenant's expense, shall file all required
architectural, mechanical and electrical drawings and obtain all necessary
permits, and shall furnish and perform all engineering and engineering drawings
in connection with Tenant's Work.
(b) Prior to Tenant's occupancy of any portion of the demised
premises for the conduct of Tenant's business, Tenant, at its expense, shall
procure a temporary certificate of occupancy for such portion. Thereafter,
Tenant shall diligently proceed to obtain a permanent certificate of occupancy.
Landlord agrees to cooperate with Tenant in obtaining all permits and
certificate pursuant to this Section 2.2, and, if requested, Landlord agrees to
join in applications therefor.
2.3 In accordance with the plan and such other plans and
specifications as may be approved by Landlord, and in compliance with Article 6
hereof, Landlord at the request of and on behalf of Tenant, at Tenant's expense
(subject to Tenant's approval), shall make and complete, or cause to be made and
completed, in and to the demised premises the work and installations (herein
called "Tenant's Work") specified in such plans. Total Cost for Tenant's Work
shall not exceed the actual costs of such work (which may include architect's
fees, engineering fees and costs incurred in connection with obtaining any
required permits and costs incurred in connection with installing telephone and
data cables) plus Landlord's fee of ten (10%) percent of the actual cost.
<PAGE> 9
ARTICLE 3
TAX ESCALATION
3.1 Tenant shall pay to Landlord, as additional rent, tax
escalation in accordance with the provisions of this Article.
3.2 Definitions:
(a) the term "TAX YEAR" shall mean each period of twelve
months, commencing on the first day of January, in which occurs any part of the
term of this Lease;
(b) the term the "A/B BUILDING" or "BUILDING A/B" shall mean
the Building;
(c) the term the "LAND" shall have the meaning set forth in
Article 1.1.;
(d) the term "COMPARATIVE YEAR" shall mean the calendar year
commencing on January 1, 1999 and each subsequent calendar year;
(e) the term "LAND TAXES" shall mean the total of all real
estate and other taxes and special, general, extraordinary or other assessments,
sewer rents, water charges, occupancy taxes, school taxes, and other taxes or
charges of any kind or nature levied, assessed, imposed or attributable at any
time by any governmental authority (including without limitation any town, city,
district, county, village, school district or public transportation authority)
upon or against the Land, and also any tax, assessment, or charge, levied,
assessed or imposed at any time by any governmental authority in connection with
the receipt of income or rents from the Land to the extent that same shall be in
lieu of all or a portion of any of the aforesaid taxes, assessments or charges,
or additions or increases thereof. 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 the Land Taxes, then such franchise, income, transit, profit or other tax or
governmental imposition shall be deemed to be included within the definition of
"LAND TAXES" for the purposes hereof. The term "Land Taxes" shall not be deemed
to include (i) gift or inheritance taxes, (ii) corporate franchise taxes or
similar business taxes imposed on noncorporate business entities, (iii) realty
transfer taxes or real property transfer gains taxes imposed in connection with
the sale of or the lease of all or substantially all of the Land or the A/B
Building, Building C or Building D (as designated on EXHIBIT A),
<PAGE> 10
(iv) mortgage recording taxes or (v) income taxes, except with respect to any
such taxes assessed or imposed in lieu of real estate taxes or any portion
thereof. As to special assessments which are payable over a period of time
extending beyond the term 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 Land Taxes. If, by law, any
assessment shall be payable in installments, then, for the purposes hereof (i)
such assessment shall be deemed to have been payable in the maximum number of
installments permitted by law and (ii) there shall be included in Land Taxes,
for each Tax Year in which such installments may be paid, the installments of
such assessment so becoming payable during such Tax Year, together with interest
payable during such Tax Year;
(f) the term "BUILDING TAXES" shall have the meaning set forth
in (e), above, except that the phrases "Land Taxes" and "Land" shall be changed
to read "Building Taxes" and the "Building", respectively;
(g) the term "LAND TAX BASE FACTOR" shall mean the amount of
Taxes attributable to the Land for the calendar year 1999;
(h) the term "BUILDING TAX BASE FACTOR" shall mean the
Building Taxes for the calendar year 1999;
(i) the term "THE BUILDING PROJECT" shall mean the Land with
all the improvements thereon (including, without limitation, the office
building(s) and parking areas erected thereon);
(j) the term "THE LAND PERCENTAGE," for purposes of computing
the Tax Escalation Payments (as hereinafter defined) to be made pursuant to this
Article 3 and the Expense Payments (as hereinafter defined) to be made pursuant
to Article 4, shall (subject to the provisions of Article 3.10 hereof) mean
eighty-two one hundredths of one percent (.82%). The Land 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
rentable square foot area of the office building(s) comprising the Building
Project. The parties agree that the rentable square foot area of the demised
premises shall be deemed to be 4,577 rentable square feet and that the rentable
square foot area of the D Building shall be deemed to be 190,137, the rentable
square foot area of the building designated Building C on EXHIBIT A annexed
hereto shall be deemed to be 86,804, the rentable square foot area of the
building designated Building A/B on EXHIBIT A annexed hereto shall be deemed to
be 281,837, and that the total
<PAGE> 11
rentable square foot area of all the office building(s) comprising a part of the
Building Project shall be deemed to be 558,778 rentable square feet. Tenant
acknowledges that the Land Percentage will be adjusted in the event that the
rentable area of the office space comprising the Building Project shall be
increased or reduced.
(k) the term "THE BUILDING PERCENTAGE," for purposes of
computing the Tax Escalation Payments (as hereinafter defined) to be made
pursuant to this Article and the Expense Payments (as hereinafter defined],
shall mean one and sixty-two one hundredths of one percent (1.62%). The Building
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 rentable square foot area of the A/B Building. The parties agree
that the rentable square foot area of the demised premises shall be deemed to be
4,577 rentable square feet and that the total rentable square foot area of the
A/B Building shall be deemed to be 281,837 rentable square feet;
(l) the term "TAX ESCALATION STATEMENT" shall mean a written
statement setting forth the amount payable by Tenant for a specified Comparative
Year pursuant to this Article, which Tax Escalation Statement shall be
accompanied by a copy of the applicable tax bills from the taxing authorities
when available; and
(m) the term "TAXES" shall mean collectively the Land Taxes
and the Building Taxes.
3.3 In the event that the Land Taxes payable for any
Comparative Year shall exceed the Land Tax Base Factor, Tenant shall pay a tax
escalation to Landlord, as additional rent for such Comparative Year, in an
amount equal to the Land Percentage of the excess. In the event that the
Building Taxes payable for any Comparative Year shall exceed the Building Tax
Base Factor, Tenant shall pay a tax escalation to Landlord as additional rent
for such Comparative Year, in an amount equal to the Building Percentage of such
excess. Any such amounts being payable by Tenant pursuant to this Section 3.3
are hereinafter called the "TAX ESCALATION PAYMENT." Before or after the start
of each Comparative Year, Landlord shall furnish to Tenant a Tax Escalation
Statement of the Taxes payable for such Comparative Year or reasonable estimates
thereof if bills are not yet available. If the Land Taxes payable or estimated
to be payable for such Comparative Year exceed the Land Tax Base Factor,
additional rent for such Comparative Year in an amount equal to the Land
Percentage of the excess shall be due from Tenant to Landlord after Landlord has
furnished Tenant with the Tax Escalation Statement. If the Building Taxes
payable or estimated to be payable for such Comparative Year exceed the Building
Tax
<PAGE> 12
Base Factor, additional rent for such Comparative Year in an amount equal to the
Building Percentage of the excess shall be due from Tenant to Landlord after
Landlord has furnished Tenant with the Tax Escalation Statement. Tenant agrees
to make payments on account of the additional rent for each Comparative Year in
twelve (12) monthly installments, each in an amount equal to one-twelfth (1/12)
of the Tax Escalation Payment, which installments may be adjusted by Landlord as
bills are received for which estimates were used. If, as finally determined, the
amount of additional rent payable by Tenant to Landlord pursuant to this Section
3.3 for a Comparative Year shall be greater than (resulting in an underpayment)
or be less than (resulting in an overpayment) the aggregate of all the
installments so paid on account to Landlord by Tenant for such Comparative Year,
then, promptly after the receipt of the Tax Escalation Statement for such
Comparative Year and, in performance of its obligations under this Article,
Tenant shall, in the case of such an underpayment, pay to Landlord an amount
equal to such underpayment with interest thereon at the Interest Rate or
Landlord shall, in the case of such an overpayment, either (i) pay to Tenant an
amount equal to such overpayment with interest thereon at the Interest Rate or
(ii) credit against the next installment(s) of fixed annual rent due from Tenant
an amount equal to such overpayment with interest at the Interest Rate. If a Tax
Escalation Statement is furnished to Tenant after the commencement of the
Comparative Year in respect of which such Tax Escalation Statement is rendered,
Tenant shall, within fifteen (15) days thereafter pay to Landlord an amount
equal to those installments of the total Tax Escalation Payment payable as
provided in this Section 3.3 during the period prior to the first day of the
month next succeeding the month in which the applicable statement has been
furnished.
3.4 If, after Tenant shall have made a payment of additional
rent under this Article, the Taxes payable for any Comparative Year on which
such payment of additional rent shall have been based shall be changed, then the
amount payable for that Comparative Year shall be revised to reflect such change
and appropriate adjustments promptly made between Landlord and Tenant. If, after
Tenant shall have made a payment of additional rent under this Article, Landlord
shall receive a refund of any portion of the Taxes payable for any Comparative
Year on which such payment of additional rent shall have been based, as a result
of a reduction of such Taxes by final determination of legal proceedings,
settlement or otherwise, Landlord shall either (i) after receiving the refund
pay to Tenant the Land or Building Percentage, as the case may be, of the refund
or (ii) credit against the next installment(s) of fixed annual rent due from
Tenant an amount equal to the Land or Building Percentage of the refund, as the
case may be.
3.5 The Tax Escalation Statement to be furnished by
<PAGE> 13
Landlord as provided in this Article shall constitute a final determination as
between Landlord and Tenant of the Tax Escalation Payment for the periods
represented thereby unless Tenant shall have paid the amount thereof and, within
sixty (60) days after the Tax Escalation Statement is furnished, shall give a
notice to Landlord that it disputes its accuracy or its appropriateness which
notice shall specify the particular respects in which the Tax Escalation
Statement is inaccurate or inappropriate. Copies of the tax bills and the
relevant records in the tax assessor's office shall be deemed prima facie
evidence of the facts set forth on the Tax Escalation Statement.
3.6 In no event shall the fixed annual rent under this Lease
be reduced by virtue of this Article.
3.7 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 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. Such 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 due from Tenant, as aforesaid, and Landlord and Tenant shall
thereupon make appropriate adjustments of amounts then owing.
3.8 Landlord's and Tenant's obligation to make the adjustments
referred to in Section 3.3 hereof above shall survive any expiration or
termination of this Lease. After the termination of the Lease, the final
adjustment for the Tax Escalation Payment pursuant to this Article 3 shall be
made as soon as practicable, and if Landlord retains any moneys of Tenant due to
excess payments made by Tenant hereunder, such excess moneys shall be promptly
refunded to Tenant after such final adjustment has been made.
3.9 Any delay or failure of Landlord to bill any Tax
Escalation Payment as provided in this Article 3 shall not constitute a waiver
of or in any way impair the continuing obligation of Tenant to pay such Tax
Escalation Payment.
3.10 Notwithstanding any other provision of this Article 3 to
the contrary, if the parcel of land on which any of the buildings comprising a
part of the Building Project shall be assessed as a separate tax lot, the Land
Percentage and the Land Tax Base Factor shall be appropriately adjusted.
ARTICLE 4
<PAGE> 14
EXPENSE ESCALATION
4.1 Tenant shall pay to Landlord, as additional rent, expense
escalation in accordance with this Article.
4.2 Definitions:
(a) the term "BUILDING EXPENSE BASE FACTOR" shall mean the
amount of Building Expenses incurred for the calendar year 1999;
(b) the term "NON-BUILDING EXPENSE BASE FACTOR" shall mean the
amount of Non-Building Expenses incurred for the calendar year 1999;
(c) the term "EXPENSE ESCALATION STATEMENT" shall mean a
written statement setting forth the amount payable by Tenant for a specified
Comparative Year pursuant to this Article;
(d) the term "BUILDING EXPENSES" shall mean the total amount
of all costs and expenses incurred or paid by Landlord with respect to and in
connection with the operation, maintenance, replacement and/or normal operating
repair of the Building, including, without limitation, the cost incurred for (i)
air conditioning; (ii) mechanical ventilation; (iii) heating; (iv) cleaning
comparable to the Cleaning Specifications annexed as EXHIBIT F; (i) rubbish
removal; (ii) window washing (interior and exterior, including inside
partitions); (iii) elevators; (iv) escalators; (v) porter and matron service;
(vi) electric current including electricity for heating, ventilation,
air-conditioning and exterior lighting to the Building and the parking areas
appurtenant thereto (excluding, however, the cost of any electricity in the
Building directly metered to tenants or otherwise allocable to space in the
Building demised to tenants); (vii) oil, purchased steam or any other fuel
consumed at the Building; (viii) protection and security; (ix) ordinary
maintenance (including but not limited to regular painting of non-tenanted areas
at the Building); (x) maintenance and repair of lobby decorations; (xi) interior
landscape work and maintenance; (xii) premiums for fire, extended coverage, any
boiler, sprinkler, apparatus, war risk (if expressly required by mortgagee of
Landlord) and property damage insurance, rental and plate glass insurance and
any other insurance required by a mortgagee of Landlord; (xiii) supplies; (xix)
wages, salaries, disability benefits, pensions, hospitalization, retirement
plans and group insurance respecting service and maintenance employees of
Landlord; (xx) uniforms and working clothes for such employees and the cleaning
thereof; (xxi) expenses imposed on Landlord pursuant to law or to any collective
bargaining agreement with
<PAGE> 15
respect to such employees; (xxii) worker's compensation insurance, payroll,
social security, unemployment and other taxes with respect to such employees;
(xxiii) sales, utility and use taxes and other taxes of like import related to
services rendered or products purchased for common areas of the Building; (xxiv)
water rates and sewer rates; (xxv) all operating charges incurred by any
superintendent's and manager's offices in the operation and maintenance of the
Building; (xxvi) charges for maintenance and service contracts for all areas of
the Building; (xxvii) all other operating costs and expenses of repair,
operation and maintenance of the Building excluding fines or penalties caused by
Landlord's negligent acts or omissions or ; (xxviii) the fees of the manager and
superintendent, their assistants and any clerical staff working for such
superintendent or manager whose duties are connected with the maintenance and
operation of the Building; (xxix) reasonable professional and consulting fees,
including legal and audit fees; the expenses, including payments to attorneys,
appraisers and other experts incurred by Landlord in connection with any
application or proceeding wherein Landlord obtains or seeks to obtain reduction
or refund of the Taxes payable or paid upon or against the Building; (xxx)
whether or not capitalized under generally accepted accounting principles, the
cost of repairs and the cost of replacements made in connection with repairs of
cables, fans, pumps, boilers, cooling equipment, wiring the electrical fixtures
and metering, control and distribution equipment, window washing equipment and
snow removal equipment, and component parts of the HVAC, electrical, plumbing,
elevator and any life or property protection systems (including, without
limitation, sprinkler systems); and (xxxi) managing agents' fees comparable to
those charged by other managing agents in Westchester County who manage similar
building projects, or if Landlord elects to manage (or have an affiliate manage)
the Building, an annual fee, for management of the Building, in an amount equal
to three percent (3%) of the rental revenues received by Landlord from the
Building for the Comparative Year in question.
Provided, however, that the following items shall be excluded from Building
Expenses:
(i) leasing commissions;
(ii) cost of repairs or replacements incurred by reason of fire or
other casualty (to the extent that Landlord is compensated therefor
through proceeds of insurance above deductible amounts), or caused by the
exercise of the right of eminent domain (to the extent the same is covered
by any condemnation award);
(iii) Taxes;
(iv) "Non-Building Expenses", as that term is
<PAGE> 16
hereinafter defined;
(v) costs incurred in performing work or furnishing services to or
for individual tenants (including this Tenant) at such tenant's expense;
and costs of performing work or furnishing services for tenants other than
this Tenant at Landlord's expense, to the extent that such work or service
is in excess of any work or service Landlord is obligated to furnish to or
for this Tenant at Landlord's expense;
(vi) expenditures for capital improvements other than those that are
(a) specifically included in the definition of Building Expenses; or (b)
included as Building Expenses pursuant to the provisions of Section 4.3(a)
or (b);
(vii) that portion of any cost or expense relating to the Building
and to other buildings or properties owned by Landlord, which is properly
allocable or attributable to such other buildings or properties unless
otherwise provided in this Lease;
(viii) debt service on any mortgages encumbering the Building, or
depreciation of the Building;
(ix) the cost for those services provided to other tenants in the
Building which services are not also provided to Tenant; and
(x) any unpaid rent relating to any space in the Building.
(e) "NON-BUILDING EXPENSES" shall mean the total of public
liability insurance and all the costs and expenses incurred or borne by Landlord
in connection with the operation, maintenance, replacement and/or normal
operating repairs of the Land and "Common Areas" (as that term is hereinafter
defined) including, without limitation, the cost incurred for snow and ice
removal, grading, striping and repair of parking lot surfaces; cleaning,
exterior landscaping, and maintenance, installation, repair and replacement of
signage, traffic control devices and signs; security, ordinary maintenance,
charges for maintenance and service contracts; repair and replacement (other
than capital replacements unless specifically included herein) and improvements
which are appropriate for the operation of the Common Areas of a first class
office building project in Westchester County, New York; all normal operating
charges incurred by any superintendent's and manager's offices in the operation
and maintenance of the Common Areas; the fees of the manager and superintendent,
their assistants and any clerical staff working for such manager or
superintendent whose duties are
<PAGE> 17
connected with the operation and maintenance of the Common Areas; whether or not
capitalized under generally accepted accounting principles, the cost of repairs
and the cost of replacements made in connection with repairs of Common Area
cables, fans, pumps, boilers, cooling equipment, wiring and electrical fixtures
and metering, control and distribution equipment, component parts of the HVAC,
electrical, plumbing, elevator and any life or property protection systems
(including, without limitation, sprinkler systems), window washing equipment and
snow removal equipment;
Provided, however that the following items shall be excluded from Non-Building
Expenses:
(i) Building Expenses;
(ii) Taxes;
(iii) expenditures for capital improvements other than those that are
(a) specifically included in the definition of Non-Building Expenses or
(b) included as Non-Building Expenses pursuant to the provisions of
Sections 4.3(a) or (b);
(iv) that portion of any cost or expense relating to both the Common
Areas and to other buildings or properties owned by Landlord, which is
properly allocable or attributable to such other buildings or properties
unless otherwise provided in this Lease; and
(v) debt service on any mortgages encumbering the Common Areas, or
depreciation of any portion of the Common Areas.
(f) The term "EXPENSES" shall mean the Building Expenses and
Non-Building Expenses.
(g) Landlord represents that the definitions of "Expenses",
"Building Expenses", and "Non-Building Expenses" are substantially consistent
with the corresponding provisions of the
other leases of space in the Building.
4.3 (a) If Landlord shall purchase any item of capital
equipment or make any capital expenditure designed to result in savings or
reductions in expenses, the costs for same shall be included in Expenses. If
Landlord shall lease any such item of capital equipment designed to result in
savings or reductions in Expenses, then the rentals and other costs paid
pursuant to such leasing shall be included in Expenses for the Comparative Year
in which they were incurred.
(b) If Landlord shall purchase any item of capital
<PAGE> 18
equipment or make any other capital expenditure in order to comply with Legal
Requirements, then the costs for same shall be included in Expenses for the
Comparative Year in which the costs are incurred and subsequent Comparative
Years, on a straight line basis, amortized over the lesser of (i) fifteen (15)
years, or (ii) the useful life of such items. If Landlord shall lease any such
item of capital equipment to comply with Legal Requirements then the rentals and
other costs paid pursuant to such leasing shall be included in Expenses for the
Comparative Year in which they were incurred. If during all or part of any
Comparative Year, Landlord shall not furnish any particular item(s) of work or
service (which would constitute an element of Expense hereunder) to portions of
the Building or the Common Areas due to the fact that such portions are not
occupied or leased, or because such item of work or service is not required or
desired by the tenant of such portion, or such tenant is itself obtaining and
providing such item of work or service, or for other reasons, then, for the
purposes of computing the additional rent payable hereunder, the amount of the
expenses for such item for such period shall be deemed to be increased by an
amount equal to the additional operating and maintenance expenses which would
reasonably have been incurred during such period by Landlord if it had at its
own expense furnished such item of work or services to such portion of the
Building or the Common Areas.
4.4 (a) If the Building Expenses for any Comparative Year
shall be greater than the Building Expense Base Factor, Tenant shall pay to
Landlord, as additional rent for such Comparative Year, in the manner
hereinafter provided, an amount equal to the Building Percentage of the excess
of the Building Expenses for such Comparative Year over the Building Expense
Base Factor. If the Non-Building Expenses for any Comparative Year shall be
greater than the Non-Building Expense Base Factor, Tenant shall pay to Landlord,
as additional rent for such Comparative Year, in the manner hereinafter
provided, an amount equal to the Land Percentage of the excess of the
Non-Building Expenses for such Comparative Year over the Non-Building Expense
Base Factor. The amounts payable by Tenant under this Section 4.4(a) are,
collectively, the "EXPENSE PAYMENT."
(b) (i) Following the expiration of each Comparative Year,
Landlord shall submit to Tenant an Expense Escalation Statement, certified by
Landlord, setting forth the Expenses for the preceding Comparative Year and the
Expense Payment, if any, due to Landlord from Tenant for such Comparative Year.
The rendition of such Expense Escalation Statement to Tenant shall constitute
prima facie proof of the accuracy thereof and, if such statement shows an
Expense Payment due from Tenant to Landlord with respect to the preceding
Comparative Year then (A) Tenant shall make payment of any unpaid portion
thereof within twenty (20) days after receipt of such Expense Escalation
Statement; (B) Tenant shall also pay to Landlord, as additional
<PAGE> 19
rent, within twenty (20) days after receipt of such Expense Escalation
Statement, an amount equal to (x) the product obtained by multiplying the total
Expense Payment for the preceding Comparative Year by a fraction, the
denominator of which shall be twelve (12) and the numerator of which shall be
the number of months of the current Comparative Year which shall have elapsed
prior to the first day of the month immediately following the rendition of such
Expense Escalation Statement less (y) the aggregate amount of Expense Payment
paid by Tenant for such elapsed months; and (C) Tenant shall also pay to
Landlord, as additional rent, commencing as of the first day of the month
immediately following the rendition of such Expense Escalation Statement and on
the first day of each month thereafter until a new Expense Escalation Statement
is rendered, one-twelfth (1/12) of the total Expense Payment for the preceding
Comparative Year. The aforesaid monthly payments based on the total Expense
Payment for the preceding Comparative Year shall be adjusted to reflect, as
reasonably estimated by Landlord, increases in rates and amounts, for the
current Comparative Year, applicable to the categories involved in computing
Expenses, whenever such increases become reasonably known or anticipated prior
to or during such current Comparative Year. The payments required to be made
under clauses (B) and (C) of this subsection 4.4(b). shall be credited toward
the Expense Payment due from Tenant for the then-current Comparative Year,
subject to adjustment as and when the Expense Escalation Statement for such
current Comparative Year is rendered by Landlord.
(ii) The Expense Escalation Statement to be furnished by
Landlord shall constitute a final determination as between Landlord and Tenant
of the Expenses for the periods represented thereby, unless Tenant shall have
paid the Expense Payment and, within sixty (60) days after it is furnished,
shall give a notice to Landlord that it disputes its accuracy or its
appropriateness, which notice shall specify the particular respects in which the
Expense Escalation Statement is inaccurate. Pending the resolution of such
dispute, Tenant shall pay the additional rent to Landlord in accordance with the
Expense Escalation Statements furnished by Landlord. After payment of said
additional rent, Tenant's certified public accountant shall have the right,
during reasonable business hours and upon not less than five (5) business days'
prior written notice to Landlord, to examine Landlord's books and records with
respect to the foregoing (which Landlord shall maintain in either Westchester
County or New York County for three (3) years subsequent to the Escalation Year
to which they relate) and, at Tenant's expense, to make copies thereof, provided
such examination is commenced within sixty (60) days and concluded within one
hundred twenty (120) days following the rendition of the Expense Escalation
Statement in question. Landlord shall cooperate with Tenant in any such
examination of its books and records and shall, if requested by Tenant in
writing, make a
<PAGE> 20
member of its staff available to explain any entries in such books and records.
(iii) Any such dispute as to an Expense Escalation Statement
referred to in subsection 4.4(b)(i) hereof shall be resolved by arbitration in
accordance with the Commercial Arbitration Rules of the American Arbitration
Association, except that the arbitration shall be by three (3) arbitrators each
of whom shall be a certified public accountant. Except as hereinafter provided
in this paragraph, the cost of such arbitration shall be split equally between
Landlord and Tenant. If the arbitrators decide that the Expense Payment shown on
the Expense Escalation Statement was overstated by more than ten (10%) percent,
then Landlord shall pay the cost of such arbitration. If the arbitrators decide
that the Expense Payment shown on the Expense Escalation Statement was
understated by more than ten percent (10%), then Tenant shall pay the cost of
such arbitration.
4.5 In no event shall the fixed annual rent under this Lease
be reduced by virtue of this Article.
4.6 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 cause an Expense Escalation Statement of the
Expenses for that Comparative Year to be prepared and furnished to Tenant.
Landlord and Tenant shall thereupon make appropriate adjustments of amounts then
owing.
4.7 Landlord's and Tenant's obligation to make the adjustments
referred to in Section 4.6 hereof shall survive any expiration or termination of
this Lease.
4.8 Any delay or failure of Landlord in billing any Expense
Payment hereinabove or hereinafter provided shall not constitute a waiver of or
in any way impair the continuing obligation of Tenant to pay such expense
escalation hereunder.
4.9 Landlord and Tenant agree that in the event of any
overpayment or underpayment of any Expense Payment, the amount of any excess to
be credited to Tenant, or the amount of any deficiency to be paid by Tenant
shall be credited or paid with interest thereon computed at the Interest Rate
from the date such deficiency was due, or such overpayment was made until,
<PAGE> 21
respectively, the date paid or credited.
4.10 Tenant acknowledges that the Building Project includes
Building A/B, Building C and Building D. If the operation of Building A/B and/or
Building C is combined with the operation of the D Building, so that Building
Expenses include such items with respect to all of such buildings, (a) the
"BUILDING PERCENTAGE" (for the purposes of this Article 4, only) shall be
reduced to reflect the percentage which the rentable square foot area of the
demised premises bears to the total rentable square foot area of the Building
and such included building(s), and (b) the Building Expense Base Factor shall be
increased to reflect the amount of Building Expenses incurred for calendar year
1999 for the Building and such included building(s).
ARTICLE 5
USE
5.1 The demised premises shall be used solely as and for
executive and general offices and for no other purpose.
5.2 Tenant shall not use or permit the use of the demised
premises or any part thereof in any way which would violate any of the
covenants, agreements, terms, provisions and conditions of this Lease or for any
unlawful purposes or in any unlawful manner or in violation of the certificate
of occupancy or other certificate or permit for the demised premises or the
Building, and Tenant shall not suffer or permit the demised premises or any part
thereof to be used in any manner or anything to be done therein or anything to
be brought into or kept therein which, in the reasonable judgment of Landlord,
shall in any way impair or tend to impair the character, reputation or
appearance of the Building as a high quality office building, impair or
interfere with or tend to impair or interfere with any of the Building services
or the proper and economic heating, cleaning, air conditioning or other
servicing of the Building or the demised premises, or impair or interfere with
or tend to impair or interfere with the use of any of the other areas of the
Building by, or occasion discomfort, inconvenience or annoyance to, any of the
other tenants or occupants of the Building.
5.3 If Tenant uses any portion of the demised premises for the
preparation or consumption of food, Tenant shall pay to Landlord the cost of
employing, on a regular basis, an exterminator to keep the demised premises free
from vermin. Tenant shall cause all food preparation areas to be properly
ventilated so that no odor shall emanate from the demised premises to any other
portion of the Building, and shall bag all wet garbage and place the same in
containers that prevent the
<PAGE> 22
escape of odor.
5.4 Tenant shall have access to the demised premises on a
24-hour basis, 7 days per week.
ARTICLE 6
ALTERATIONS AND INSTALLATIONS
6.1 Except for the Tenant's Work, Tenant shall make no
alterations, installations, additions or improvements (such work hereinafter
collectively referred to as "ALTERATIONS") in or to the demised premises without
Landlord's prior written consent and then only by contractors or mechanics first
approved by Landlord. All Alterations shall be done at Tenant's sole cost and
expense, and at such times and in such manner as Landlord may from time to time
reasonably designate.
Tenant may from time to time during the term of this lease, at
its expense, make non-structural cosmetic changes, which cost less than
Twenty-Five Thousand 00/100 Dollars ($25,00.00), without Landlord's prior
consent.
Tenant shall obtain and deliver to Landlord written,
unconditional waivers of mechanic's or other liens on the real property in which
the demised premises are located, signed by all architects, engineers,
contractors, mechanics and designers involved in such Alterations as and when
such architects, engineers, contractors, mechanics and designers are paid for
their work in connection therewith.
Any Alterations in the demised premises shall be effected
solely in accordance with the plans and specifications approved by Landlord.
Tenant shall reimburse Landlord promptly upon demand for any reasonable
out-of-pocket costs and expenses incurred by Landlord in connection with
Landlord's review of such Tenant's plans and specifications. Landlord will not
unreasonably withhold or delay its consent for nonstructural Alterations
(provided they will not affect the outside of the Building or the demised
premises or adversely affect the Building's structure, electrical, HVAC,
plumbing, mechanical or other systems). Prior to granting its consent to
Alterations, Landlord may impose such conditions as to guarantee of completion
and payment and of restoration as Landlord may reasonably consider desirable.
Any such approved Alterations shall be performed in accordance
with the foregoing and the following provisions of this Article 6:
<PAGE> 23
(a) All Alterations shall be done in a professional and
workmanlike manner.
(b) (1) In the event Tenant shall employ any contractor to do
in the demised premises any Alterations permitted by this Lease, such contractor
and any subcontractor shall agree to employ only such labor as will not result
in jurisdictional disputes or strikes or result in causing disharmony with other
workers employed at the Building. Tenant will inform Landlord in writing of the
names of any contractor or subcontractor Tenant proposes to use in the demised
premises at least ten (10) days prior to the beginning of work by such
contractor or subcontractor, but such information given to Landlord shall in no
way constitute Landlord's approval of such contractor or subcontractor.
(2) Tenant covenants and agrees to pay to its
contractor(s), as the work progresses, the entire cost (less a reasonable
retainage) of supplying the materials and performing the work shown on Tenant's
approved plans and specifications in accordance with Tenant's contract or
contracts with such contractor(s).
(c) All such Alterations shall be effected in compliance with
all applicable laws, ordinances, rules and regulations of governmental bodies
having or asserting jurisdiction in the demised premises and all applicable
insurance rules and regulations.
(d) Tenant shall keep the Building Project 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 on Tenant's behalf, and all
work to be performed by Tenant shall be done in a manner which will not
unreasonably interfere with or disturb other tenants or occupants of the
Building.
(e) During the progress of the work to be done by Tenant, said
work shall be subject to inspection by representatives of Landlord which, upon
reasonable notice, shall be permitted access and the opportunity to inspect, at
all reasonable times, but this provision shall not in any way whatsoever create
any obligation on Landlord to conduct such an inspection or create any
obligations or liability (or relieve Tenant of any obligations under this Lease)
in the event Landlord does conduct such an inspection.
(f) Prior to commencement of any work, Tenant or Tenant's
contractor(s) shall furnish to Landlord certificates evidencing the existence
of:
<PAGE> 24
(i) worker's compensation insurance covering all persons employed for
such work; and
(ii) contractor's comprehensive general liability and property damage
insurance naming Landlord, any of its mortgagees and ground lessors and
Tenant as insureds, with coverage of at least $3,000,000 combined single
limit.
6.2 Any mechanic's lien, filed against the demised premises or
the Building or the Building Project for work claimed to have been done for or
materials claimed to have been furnished to Tenant shall be discharged by Tenant
at its expense within thirty (30) days after notice of such filing, by payment,
filing of the bond required by law or otherwise. Notice is hereby given that
Landlord shall not be liable for any labor or materials furnished or to be
furnished to Tenant upon credit, and that no mechanic's or other lien for any
such labor or materials shall attach to or affect the reversion or other estate
or interest of Landlord in and to the demised premises.
6.3 All work, installations and improvements made and
installed by solely Landlord shall be the property of Landlord and shall remain
upon and be surrendered with the demised premises as a part thereof at the end
of the term of this Lease; provided, however, that Landlord's contribution shall
not grant Landlord any title or claim to title to Tenant's Work.
6.4 All Alterations and/or Tenant's Changes, made and
installed by Tenant, or at Tenant's expense, upon or in the demised premises
shall become and be the property of Landlord, and shall remain upon and be
surrendered with the demised premises as a part thereof at the end of the term
of this Lease. Notwithstanding the foregoing, Tenant shall remove all
Alterations which in Landlord's reasonable judgment are of a non- Building
Standard nature, such as internal stairways, slab openings, special electronic
data processing or communications installations, vaults and raised floors, at or
before the Expiration Date or within fifteen (15) business days after any
earlier termination date, and Tenant shall repair or pay the cost of repairing
any damage to the demised premises or Building resulting from the removal
thereof and restoring the demised premises to their condition prior to the
installation thereof unless at the time of installation, Tenant shall have
requested and obtained Landlord's waiver of the removal of such Alterations or
Tenant's Changes.
6.5 Where furnished by or at the expense of Tenant all
furniture, furnishings and trade fixtures, including, without limitation,
murals, business machines and equipment, telecommunications equipment and
cabling, counters, screens, grille work, special paneled doors, cages,
partitions, metal
<PAGE> 25
railings, closets, panelling, lighting fixtures and equipment, drinking
fountains, refrigeration and air handling equipment, and any other movable
property shall remain the property of Tenant which may at its option remove all
or any part thereof at any time prior to the expiration of the term of this
Lease.
6.6 If any Alterations or other property which Tenant shall
have the right to remove or be requested by Landlord to remove as provided in
Article 6.4 or 6.5 hereof (hereinafter called "TENANT'S PROPERTY") are not
removed on or prior to the expiration of the term of this Lease, Landlord shall
have the right to remove Tenant's Property and to dispose of the same without
accountability to Tenant and at the sole cost and expense of Tenant. Landlord
shall endeavor to give notice to Tenant that Tenant may remove such Tenant's
Property within five (5) days of the date stated therein; provided that
Landlord's failure to give such notice shall not give rise to any claim against
or liability on Landlord's part. In case of any damage to the demised premises
or Building resulting from the removal of Tenant's property, Tenant shall repair
such damage or, in default thereof, shall reimburse Landlord for Landlord's cost
in repairing such damage. This obligation shall survive any termination of this
Lease.
6.7 Tenant shall keep records of Tenant's Alterations costing
in excess of $50,000, and of the cost thereof for a period of five (5) years
after the completion thereof. Tenant shall, within forty-five (45) days after
demand by Landlord, furnish to Landlord copies of such records and cost if
Landlord shall require the same in connection with any proceeding to reduce the
assessed valuation of the A/B Building, Building C or Building D or any other
tax or charge, or in connection with any proceeding instituted pursuant to
Articles 13 or 14 hereof.
ARTICLE 7
REPAIRS
7.1 Tenant shall, at its sole cost and expense, make such
repairs to the demised premises and the fixtures and appurtenances therein as
are necessitated by the reckless or negligent acts or omissions of Tenant or by
the use of the demised premises in a manner contrary to the purposes for which
same are leased to Tenant as set forth in Section 5.1, as and when needed to
preserve them in good working order and condition subject to normal wear and
tear and damage by fire or other casualty. All damage or injury to the demised
premises and to its fixtures, appurtenances and equipment or to the Building or
to its fixtures, appurtenances and equipment caused by Tenant moving property in
or out of Building or by installation or removal of furniture, fixtures or other
property by or on behalf
<PAGE> 26
of Tenant, shall be repaired, restored or replaced promptly by Tenant at its
sole cost and expense, which repairs, restorations and replacements shall be in
quality and class equal to the original work or installations. If Tenant fails
to make such repairs, restoration or replacements, within ten (10) days after
Landlord gives Tenant written notice of the necessity thereof, the same may be
made by Landlord at the expense of Tenant and such expense shall be collectible
as additional rent and shall be paid by Tenant within thirty (30) days after
rendition of a bill therefor.
The exterior walls of the Building, the portions of any
windowsills outside the windows, and the windows are not part of the premises
demised by this Lease and Landlord reserves all rights to such parts of the
Building.
7.2 Tenant shall not place a load upon any floor of the
demised premises exceeding fifty (50) pounds per useable square foot live load,
and if Tenant shall desire a floor load in excess of such floor load, Landlord
agrees to strengthen and reinforce the same so as to give the live load desired,
provided, (i) Tenant shall submit to Landlord the plans showing the locations of
and the desired floor live load for the areas in question, (ii) Tenant shall
agree to pay for or reimburse Landlord on demand for the cost of such
strengthening and reinforcement as well as any other costs to and expenses of
Landlord occasioned by or resulting from such strengthening or reinforcement,
(iii) Landlord's architects, in their sole reasonable discretion, find that the
work necessary to increase such floor load does not adversely affect the
structure of the Building and (iv) such work will not interfere with the amount
or availability of any space adjoining alongside, above or below the demised
premises, or interfere with the occupancy of other tenants in the Building.
7.3 Landlord shall exercise reasonable diligence in the making
of any repairs, alterations, additions or improvements so as to minimize any
interference with Tenant's business operations, but shall not be required to
perform the same on an overtime or premium pay basis.
7.4 Landlord shall, at its expense (subject to the provisions
of Section 7.1 hereof and to reimbursement as set forth in Article 4 hereof)
keep and maintain the Common Areas and the Building in good condition and repair
in accordance with the standards appropriate to a first class office building in
Westchester County, New York, and make all repairs, structural and otherwise,
interior and exterior, as and when needed in or about the demised premises,
except for those repairs for which Tenant is responsible pursuant to the
provisions of this Lease.
ARTICLE 8
<PAGE> 27
REQUIREMENTS OF LAW
8.1 Tenant, at Tenant's cost and expense, shall comply with
all Legal Requirements (as defined in Section 22.4) which result from Tenant's
manner or use or occupation of the demised premises. Landlord represents that,
as of the date hereof, the demised premises are in substantial compliance with
all Legal Requirements and Tenant's use as set forth Section 5.1 is permitted
under the current Certificate of Occupancy for the Building.
8.2 Notwithstanding the provisions of Section 8.1 hereof,
Tenant, at its own cost and expense, in its name may contest, in any manner
permitted by law (including appeals to a court, or governmental department or
authority having jurisdiction in the matter), the validity or the enforcement of
any governmental act, regulation or directive with which Tenant is required to
comply pursuant to this Lease, and may defer compliance therewith provided that:
(a) such non-compliance shall not subject Landlord to criminal
or civil prosecution or subject the Land and/or the Building Project to lien or
sale;
(b) such non-compliance shall not be in violation of any fee
mortgage, or of any ground or underlying lease or any mortgage thereon;
(c) Tenant shall first deliver to Landlord a surety bond (in
such sum as Landlord may reasonably request) issued by a surety company of
recognized responsibility, or other security satisfactory to Landlord,
indemnifying and protecting Landlord against any loss or injury by reason of
such non-compliance; and
(d) Tenant shall promptly and diligently prosecute such
contest.
Landlord, without expense or liability to it, shall cooperate
with Tenant and execute any documents or pleadings required for such purpose,
provided that Landlord shall reasonably be satisfied that the facts set forth in
any such documents or pleadings are accurate.
ARTICLE 9
INSURANCE, LOSS, REIMBURSEMENT, LIABILITY
9.1 Tenant shall not knowingly or intentionally violate, or
permit the violation of, any condition imposed by any insurance policy then
issued in respect to the Building Project
<PAGE> 28
and/or the property therein and shall not do, or permit anything to be done, or
keep or permit anything to be kept in the demised premises which would subject
Landlord to any liability or responsibility for bodily injury or death or
property damage, or which would increase any insurance rate in respect to the
Building Project or the property therein over the rate which would otherwise
then be in effect or which would result in insurance companies of good standing
refusing to insure the Building Project or the property therein in amounts
reasonably satisfactory to Landlord, or which would result in the cancellation
of or the assertion of any defense by the insurer in whole or in part to claims
under any policy of insurance in respect of the Building Project or the property
therein, but nothing contained in this Section 9.1 shall be construed to
restrict Tenant's use of the demised premises for the purposes permitted under
Article 5 hereof.
9.2 If, by reason of any failure of Tenant to comply with the
provisions of Section 8.1 or Section 9.1, the premiums on Landlord's insurance
on the Building Project and/or equipment or property therein shall be higher
than they otherwise would be, Tenant shall reimburse Landlord, on demand, for
that part of such premiums attributable to such failure on the part of Tenant. A
schedule or "make up" of rates for the Building Project issued by the applicable
fire insurance rating organization or other similar body making rates for
insurance for the Building Project shall be conclusive evidence of the facts
therein stated and of the several items and charges in the insurance rate then
applicable to the Building Project.
9.3 Tenant, at its expense, shall maintain at all times during
the term of this Lease (a) "all risk" property insurance covering Tenant's
property and improvements and betterments to a limit of not less than 100% of
the replacement cost thereof and (b) comprehensive general liability insurance,
including contractual liability, in respect of the demised premises and the
conduct or operation of business therein, with Landlord and its managing agent,
if any, and any lessor of any ground or underlying lease or the holder of any
mortgage, as the case may be, whose name and address shall have been furnished
to Tenant, as additional insureds, with limits of not less than $3,000,000
combined single limit bodily injury and property damage liability. Landlord
hereby agrees that the comprehensive general liability insurance requirement
described in clause (b) of the preceding sentence may be satisfied through the
use of umbrella coverage, which umbrella coverage must be evidenced by a policy
of insurance satisfactory to Landlord. The limits of such insurance shall not
limit the liability of Tenant hereunder. Tenant shall deliver to Landlord and
any additional insureds such fully paid-for policies and certificates of
insurance in form satisfactory to Landlord issued by the insurance company or
its authorized agent, at least ten (10) days before the Commencement
<PAGE> 29
Date. Tenant shall procure and pay for renewals of such insurance from time to
time before the expiration thereof, and Tenant shall deliver to Landlord and any
additional insureds such renewal policy and certificates of coverage at least
thirty (30) days before the expiration of any existing policy. All such policies
shall be issued by companies reasonably acceptable to Landlord. If Landlord is
included as a named payee on any check issued by Tenant's insurer in payment of
any claim solely with respect to Tenant's property, Landlord agrees that it will
promptly upon Tenant's request endorse such check to Tenant. Landlord further
agrees that it shall have no right or authority to participate in any settlement
of any claim by Tenant against its insurer which relates solely to damage or
loss to Tenant's property.
9.4 Each party agrees to have included in each of its
insurance policies a waiver of the insurer's right of subrogation against the
other party (and in the case of Tenant against other tenants of the Building)
during the term of this Lease or, if such waiver should be unobtainable or
unenforceable, (i) an express agreement that such policy shall not be
invalidated if the insured waives the right of recovery against any party
responsible for a casualty covered by the policy before the casualty, or (ii)
any other form of permission for the release of the other party reasonably
satisfactory to the party intended to be released. If such waiver, agreement or
permission shall not be, or shall cease to be, obtainable from either party's
then current insurance company, the insured party shall so notify the other
party promptly after learning thereof, and shall use commercially reasonable
efforts to obtain the same from another insurance company (if the insured party
is Tenant, an insurance company described in Section 9.3 hereof). Each party
hereby releases the other party (and in the case of Tenant, other tenants of
Building who shall have executed a similar waiver or agreement as set forth in
this Section 9.4) with respect to any claim (including a claim for negligence)
which it might otherwise have against the other party, for loss, damage or
destruction with respect to its property occurring during the term of this Lease
to the extent to which it is required pursuant to the terms hereof, to be
insured under a policy or policies containing a waiver of subrogation, agreement
or permission to release liability, as provided in the preceding subdivisions of
this section. If, notwithstanding the recovery of insurance proceeds by either
party for loss, damage or destruction of its property, the other party is liable
to the first party with respect thereto or is obligated under this Lease to make
replacement, repair or restoration or payment, then, provided the first party's
right of full recovery under its insurance policies is not thereby prejudiced or
otherwise adversely affected, the amount of the net proceeds of the first
party's insurance against such loss, damage or destruction shall be offset
against the second party's liability to the first party therefor, or shall be
made available
<PAGE> 30
to the second party to pay for replacement, repair or restoration, as the case
may be. Nothing contained in this section shall be deemed to relieve either
party of any duty imposed elsewhere in this Lease to repair, restore or rebuild
provided for elsewhere in this Lease.
9.5 Landlord may from time to time, but not more frequently
than once every three (3) years, require that the amount of comprehensive
general liability insurance to be maintained by Tenant under Section 9.3 or
Section 6.1(f) be reasonably increased.
9.6 Landlord or its agents shall not be liable for any injury
or damage to persons or property resulting from fire, explosion, falling
plaster, steam, gas, electricity, water, rain or snow or leaks from any part of
the Building Project, or from the pipes, appliances or plumbing works or from
the roof, street or subsurface or from any other place or by dampness or by any
other cause of whatsoever nature, unless any of the foregoing shall be caused by
or due to the negligence of Landlord.
9.7 Landlord or its agents shall not be liable for any damage
which Tenant may sustain if at any time any window of the demised premises is
temporarily closed, darkened or bricked up for any reason whatsoever, or
permanently closed, darkened or bricked up to comply with Legal Requirements or
the requirements of Landlord's insurers, and Tenant shall not be entitled to any
compensation therefor or abatement of rent or to any release from any of
Tenant's obligations under this Lease, nor shall the same constitute an
eviction.
9.8 Each party agrees to give the other party notice in case
of fire or accidents in the demised premises promptly after such party becomes
aware of such event.
ARTICLE 10
LANDLORD'S LIABILITY
10.1 Tenant agrees to look solely to Landlord's estate and
interest in the Building, or the proceeds from the sale thereof for the
satisfaction of any right or remedy of Tenant for the collection of a judgment
(or other judicial process) requiring the payment of money by Landlord, in the
event of any liability by Landlord hereunder, and no other property or assets of
Landlord shall be subject to levy, execution, attachment, 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 demised premises, or any other liability of Landlord to
Tenant hereunder. Neither the partners constituting Landlord
<PAGE> 31
(the "PARTNERS"), nor the partners, shareholders, directors or officers of
Landlord or the Partners shall be liable for the performance of Landlord's
obligations under this Lease.
ARTICLE 11
ASSIGNMENT, MORTGAGING, SUBLETTING, ETC.
11.1 Subject to the provisions of Section 11.2 hereof Tenant
shall not (a) assign or otherwise transfer this Lease or any interest herein, or
the term and estate hereby granted, (b) sublet the demised premises or any part
thereof or allow the same to be used or occupied by others, (c) mortgage, pledge
or encumber this Lease or the demised premises or any part thereof in any manner
by reason of any act or omission on the part of Tenant, or (d) advertise, or
authorize a broker to advertise, for a subtenant or an assignee at a
consideration or at rental rates below the rental rates then being advertised by
Landlord as its rental rates for comparable space in the Building Project and
for a comparable term, without, in each instance, obtaining the prior written
consent of Landlord, except as otherwise expressly provided in this Article 11.
For purposes of this Article 11, (i) the transfer of a majority of the issued
and outstanding capital stock of any corporate tenant, or of a corporate
subtenant, or the transfer of a majority of the total interest in any
partnership, limited liability company or other entity that is the Tenant or a
subtenant, however accomplished, whether in a single transaction or in a series
of related or unrelated transactions, shall be deemed an assignment of this
Lease, or of such sublease, as the case may be, and (ii) a takeover agreement
shall be deemed a transfer of this Lease.
11.2 The consent of Landlord shall not be required for (but
the provisions of Section 11.5(d) hereof shall be applicable to) an assignment
or sublease of all or any portion of the demised premises to (i) a corporation
into or with which Tenant is merged or consolidated, (ii) an entity to which
substantially all of Tenant's shares or assets are transferred or, (iii) if
Tenant is a partnership, a successor partnership, provided that any such merger,
consolidation, transfer or other transaction is not principally for the purpose
of transferring the leasehold estate created hereby, and provided further, that
the assignee, successor or subtenant, as applicable, has a net worth at least
equal to or in excess of the net worth of Tenant immediately prior to the
transaction in question. The provisions of clauses (a) and (b) of Section 11.1
shall not apply to transactions with an entity (hereinafter called an
"AFFILIATE") which controls or is controlled by Tenant or is under common
control with Tenant during the period it remains an Affiliate. Furthermore, an
Affiliate of Tenant shall be permitted to occupy the demised premises but only
during such period as it shall
<PAGE> 32
remain an Affiliate. For the purposes of the foregoing "control" shall mean
ownership of 50% or more of the stock, partnership interests or other equity
interests in the entity.
11.3 Any assignment or transfer, whether made with Landlord's
consent as required by Section 11.1 or without Landlord's consent pursuant to
Section 11.2, shall not be effective hereunder until, the assignee shall
execute, acknowledge and deliver to Landlord a recordable agreement, in form and
substance reasonably satisfactory to Landlord, whereby the assignee shall assume
the obligations and performance of this Lease from and after the date of such
assignment and agree to be personally bound by and upon all of the covenants,
agreements, terms, provisions and conditions hereof on the part of Tenant to be
performed or observed and whereby the assignee shall agree that the provisions
of Section 11.1 hereof shall, notwithstanding any further assignment or
transfer, continue to be binding upon it in the future. Tenant covenants that,
notwithstanding any assignment or transfer, whether or not in violation of the
provisions of this Lease, and notwithstanding the acceptance of fixed annual
rent by Landlord from an assignee or transferee or any other party, Tenant shall
remain fully and primarily liable for the payment of the fixed annual rent and
additional rent due and to become due under this Lease and for the performance
of all of the covenants, agreements, terms, provisions and conditions of this
Lease on the part of Tenant to be performed or observed.
11.4 (a) Except for an assignment or sublease pursuant to
Section 11.2 hereof, if Tenant agrees to enter into an assignment of this Lease
or a sublease to sublet the demised premises or any portion thereof, Tenant
shall, as soon as that agreement is consummated, but no less than sixty (60)
days prior to the effective date of the contemplated assignment or sublease,
deliver to Landlord an executed counterpart of the proposed assignment or
sublease, and Landlord shall then have the right to elect, by notifying Tenant
within thirty (30) days of such delivery, to (i) in the case of an assignment of
this Lease, to terminate this Lease or to accept an assignment of this Lease
from Tenant, and Tenant shall then promptly execute and deliver to Landlord or
entity affiliated with Landlord, in form reasonably satisfactory to Landlord's
counsel, an assignment on the terms reflected in the proposed assignment, which
assignment shall be effective as of such effective date and shall relieve Tenant
of further liability accruing under this Lease after such effective date as to
such portion of the demised premises assigned to Landlord or entity affiliated
with Landlord, and (ii) in the case of a proposed subletting, to terminate this
Lease, with respect to the portion of the demised premises affected by any such
proposed subletting or the entire demised premises in the case of a proposed
subletting thereof or to accept a sublease from Tenant thereof, and Tenant shall
then promptly execute and deliver a sublease to Landlord or entity affiliated
with
<PAGE> 33
Landlord, for the duration of Tenant's proposed subletting, commencing with
such effective date, at the rental terms reflected in the proposed sublease. If
an offer of sublease to Landlord results in all or substantially all of the
demised premises being sublet for substantially all of the term of this Lease
(i.e., the balance of the term less one year or less), then Landlord shall have
the option to extend the term of the sublease being offered to it for the
remainder of the term of this Lease less one day.
(b) If Landlord should elect to have Tenant execute and
deliver a sublease pursuant to any of the provisions of this Section 11.4, said
sublease shall be in a form reasonably satisfactory to Landlord's counsel and on
all the terms contained in this Lease, except that:
(i) The rental terms shall be as provided in
subsection 11.4(a) hereof,
(ii) The sublease shall not provide for any work to be done
for the subtenant or for any initial rent concessions or contain
provisions inapplicable to a sublease, except that in the case of a
subletting of a portion of the demised premises, Tenant shall reimburse
subtenant for the cost of erecting such demising walls as are necessary
to separate the subleased premises from the remainder of the demised
premises and to provide access and building services thereto, provided
Tenant was obligated to perform such work or reimburse the proposed
subtenant for such work under the terms of the proposed sublease,
(iii) The subtenant thereunder shall have the right to
underlet the subleased premises, in whole or in part, without Tenant's
consent,
(iv) The subtenant thereunder shall have the right to make,
or cause to be made, any changes, alterations, decorations, additions
and improvements that such subtenant may desire or authorize,
(v) Such sublease shall expressly negate any intention that
any estate created by or under such sublease be merged with any other
estate held by either of the parties thereto,
(vi) Any consent required of Tenant, as lessor under that
sublease, shall be deemed granted if consent with respect thereto is
granted by Landlord,
(vii) The use of the sublet premises by the subtenant shall
be for general, administrative and/or executive offices unless
constructed for another purpose by
<PAGE> 34
or for Tenant in which event Landlord may in addition use it for such
purpose,
(viii) Any failure of the subtenant thereunder to comply with
the provisions of said sublease, other than with respect to the payment
of rent to Tenant, shall not constitute a default thereunder or
hereunder if Landlord has consented to such non-compliance, unless such
failure to comply would cause a violation of law or would increase or
extend the liability of Tenant under this Lease,
(ix) Upon execution of such sublease, Tenant's obligations
with respect to vacating the demised premises and removing any changes,
alterations, decorations, additions or improvements made in the
subleased premises shall be limited to those which accrued and related
to such as were made prior to the effective date of the sublease, and
(x) Such sublease shall provide that at the expiration of
the term of such subletting Tenant will accept the space in the
condition provided for in the proposed sublease.
If Landlord should elect to have Tenant execute and deliver a
sublease pursuant to any of the provisions of this Section 11.4, Tenant shall be
excused from having to obtain Landlord's consent, as required by the terms of
this Lease, for changes, alterations, decorations, additions or improvements
desired by the subtenant.
(c) If pursuant to the exercise of any of Landlord's options
pursuant to this Section 11.4 hereof this Lease is terminated as to only a
portion of the demised premises, then the fixed annual rent payable hereunder
and the additional rent payable pursuant to Articles 3 and 4 hereof shall be
adjusted in proportion to the portion of the demised premises affected by such
termination.
11.5 In the event that Landlord does not exercise the option
available to it pursuant to subsection 11.4(a) hereof, Landlord shall not
unreasonably withhold or delay its consent to an assignment of this Lease or a
proposed subletting of the demised premises, as the case may be, by Tenant,
provided:
(a) Tenant shall have furnished Landlord with the name and
business address of the proposed subtenant or assignee, information with respect
to its intended use of the demised premises and the nature and character of the
proposed subtenant's or assignee's business, or activities, and, if Tenant is no
longer the actual tenant of the demised premises, such reasonable references and
current financial information with respect to net
<PAGE> 35
worth, credit and financial responsibility as are reasonably satisfactory to
Landlord, and an executed counterpart of the sublease or assignment agreement;
(b) the proposed subtenant or assignee is a reputable party
whose financial net worth, credit and financial responsibility is, considering
the responsibilities involved, satisfactory to Landlord;
(c) the proposed subtenant or assignee is not then an occupant
of any part of the Building Project or a party who is dealing with Landlord or
Landlord's agent (directly or through a broker) with respect to space then
available (or becoming available) in the Building Project; and
(d) each sublease shall specifically state that (i) it is
subject to all of the terms, covenants, agreements, provisions, and conditions
of this Lease, and (ii) the subtenant or assignee, as the case may be, will not
have the right to a further assignment thereof or sublease or assignment
thereunder, or to allow the demised premises to be used by others, without the
prior reasonable consent of Landlord in each instance.
11.6 If Tenant defaults in the payment of any rent, Landlord
is authorized to collect any rents due or accruing from any assignee, subtenant
or other occupant of the demised premises and to apply the net amounts collected
to the fixed annual rent and additional rent reserved herein. The receipt by
Landlord of any amounts from an assignee or subtenant, or other occupant of any
part of the demised premises shall not be deemed or construed as releasing
Tenant from Tenant's obligations hereunder or the acceptance of that party as a
direct tenant.
ARTICLE 12
ELECTRICITY
12.1 (a) Landlord shall supply electricity to the demised
premises in accordance with the provisions of this Section 12.1. For the
purposes of this Section 12.1, Landlord and Tenant agree that the term "COST PER
KILOWATT HOUR" shall mean the total cost for electricity incurred by Landlord to
service the demised premises, as measured by the meter servicing that portion of
the Building in which the demised premises are located, during a particular time
period (including all applicable surcharges, demand charges, energy charges,
fuel adjustment charges, time of day charges, taxes and other sums payable in
respect thereof) divided by the total kilowatt hours purchased by Landlord
during such period.
(b) Electricity shall be supplied by Landlord to
<PAGE> 36
service the demised premises and Tenant shall pay to Landlord, as additional
rent, an amount determined by applying the Cost per Kilowatt hour to Tenant's
consumption of and demand for electricity within the demised premises as
recorded on the submeter or submeters servicing the demised premises. Where more
than one meter measures the electric service to Tenant, the electric service
rendered through each meter shall be computed and billed separately in
accordance with the provisions hereinafter set forth. Bills for the electricity
additional rent shall be rendered to Tenant at such time as Landlord may elect.
If any tax is imposed upon Landlord's receipts from the sale of electricity to
Tenant by Federal, State or municipal authority, Tenant agrees that, unless
prohibited by law, Tenant's proportionate share of such taxes shall be included
in the bill of, and paid by Tenant to, Landlord, as additional rent. Landlord's
failure during the term of this Lease to prepare and deliver any statements or
bills under this Article 12, or Landlord's failure to make a demand under this
Article 12, or any other provisions of this Lease shall not in any way be deemed
to be a waiver of, or cause Landlord to forfeit or surrender its rights to
collect, any amount of additional rent which may have become due pursuant to
this Article 12 during the term of this Lease. The costs incurred by Landlord
for meter readings for those meters and sub-meters that measure the electric
service supplied to Tenant, and the costs incurred by Landlord in the
maintenance of such meters and sub-meters, shall be paid by Tenant on demand, as
additional rent. Tenant's liability for any amounts due under this Article 12
shall survive the expiration or sooner termination of this Lease.
12.2 Notwithstanding the provisions of Section 12.1 above, at
Landlord's option, Tenant shall, within sixty (60) days after receiving notice
from Landlord (or any shorter period as may be required by applicable legal
requirements), contract directly with the public utility furnishing electric
current to the Building for the supply, at Tenant's cost, of all electric
current to be used in the demised premises including, without limitation, such
as is required for the operation of any supplemental heating, ventilating and
air-conditioning system serving the demised premises except that which is used
in the operation of the "HVAC SYSTEM" (as that term is hereinafter defined in
Section 21.1).
12.3 Tenant's use of electric current in the demised premises
shall not at any time exceed the capacity of any of the electrical conductors
and equipment in or otherwise serving the demised premises. Tenant shall not
make or perform, or permit the making or performing of, any alterations to
wiring, installations or other electrical facilities in or serving the demised
premises without the prior consent of the Landlord in each instance. Should
Landlord grant any such consent, all additional risers or other equipment
required therefor shall be
<PAGE> 37
installed by Landlord (after advising Tenant of the estimated cost thereof and
provided Tenant elects to have Landlord proceed with such work) and the cost
thereof shall be paid by Tenant upon Landlord's demand, at which time Landlord
shall provide Tenant with documentation in regard to such costs, which such
costs shall not exceed what would be paid in an arm's-length transaction and any
such alterations shall be made in accordance with Article 6 thereof.
12.4 Landlord shall not be liable in any way to Tenant for any
failure or defect in the supply or character of electric energy furnished to the
demised premises by reason of any requirement, act or omission of the public
utility serving the Building with electricity or for any other reason and not
attributable to Landlord's negligence.
12.5 If, at any time during the term of this Lease, Tenant
wishes to install in the demised premises equipment which would not be
considered ordinary office equipment, including, but not limited to, items such
as computer installation or supplemental air conditioning systems, or other heat
or cooling- intensive electrically operated equipment, Tenant shall submit to
Landlord a list indicating the specific type of additional equipment to be
installed. Such list shall include the number, type and model of each item of
equipment to be installed, as well as the manufacturer's electrical rating
associated with same. If, in Landlord's reasonable judgment the operation of
such equipment will impair the proper operation of the plumbing, heating,
ventilation, air conditioning or other systems for the Building, Tenant shall
not be permitted to make such installation, provided that Landlord, in its sole
discretion, may permit Tenant to make such installation if as a condition to the
installation of such equipment, Tenant shall reimburse Landlord for Landlord's
additional cost incurred, as a result of such equipment installation and
operation, in connection with the proper function of such systems.
ARTICLE 13
DAMAGE BY FIRE OR OTHER CAUSE
13.1 If the Building or the demised premises shall be
partially or totally damaged or destroyed by fire or other cause, within
forty-five (45) days after Landlord acquires knowledge of such damage, Landlord
shall deliver to Tenant an estimate prepared by a reputable contractor selected
by Landlord setting forth such contractor's estimate as to the reasonable time
required to repair such damage. If the demised premises are damaged or destroyed
or if they are not but the building is damaged, which damage materially
adversely affects Tenant's access to the demised premises, and the time period
set forth in
<PAGE> 38
such estimate exceeds three hundred and sixty (360) days, Tenant may elect to
terminate this Lease by notice to Landlord not later than fifteen (15) days
following the delivery of such estimate to Tenant. If Tenant makes such
election, the Term shall expire upon the twentieth (20th) day after notice of
such election is given by Tenant and Tenant shall vacate the demised premises
and surrender the same to Landlord. Upon such termination, Tenant's liability
for fixed annual rent and additional rent shall cease as of the day following
such damage and any prepaid portion thereof for any period after such date shall
be refunded by Landlord to Tenant. If (x) the estimate does not exceed three
hundred and sixty (360) days, or (y) Tenant fails to make its election as set
forth hereinabove in this paragraph, and if Landlord does not make the election
under Section 13.3 (if applicable), Landlord shall repair the damage and restore
and rebuild the Building and/or the demised premises, at its expense (without
limiting the rights of Landlord under any other provisions of this Lease);
provided, however, that Landlord shall not be required to repair or replace any
of Tenant's property, improvements, betterments or Alterations.
13.2 If the Building or the demised premises shall be
partially damaged or partially destroyed by fire or other cause, the fixed
annual rent and additional rent payable hereunder shall be abated to the extent
that the demised premises shall have been rendered untenantable for the period
from the date of such damage or destruction to the date the damage shall be
substantially repaired or restored. If the demised premises shall be totally
(which shall be deemed to include substantially totally) damaged or destroyed or
rendered completely (which shall be deemed to include substantially completely)
untenantable on account of fire or other cause, the fixed annual rent and
additional rent shall abate as of the date of the damage or destruction and
until Landlord shall substantially repair, restore and rebuild the Building and
the demised premises. Should Tenant reoccupy a portion of the demised premises
during the period the restoration work is taking place with respect to any
damage or destruction referred to in this Section 13.2 and prior to the date
that the same are made tenantable, rents allocable to such portion shall be
payable by Tenant from the date of such occupancy. Furthermore, if Tenant delays
the performance of the restoration work, such work shall be deemed to be
substantially completed on the date that it would have been completed but for
such delay.
13.3 If the Building or the demised premises shall be totally
(which shall be deemed to include substantially totally) damaged or destroyed by
fire or other cause, or if the Building shall be so damaged or destroyed by fire
or other cause (whether or not the demised premises are damaged or destroyed) as
to require a reasonably estimated expenditure of more than forty percent (40%)
of the full insurable value of the Building immediately prior to the casualty,
then in either such case
<PAGE> 39
Landlord may terminate this Lease by giving Tenant notice to such effect within
one hundred twenty (120) days after the date of the casualty.
13.4 No damages, compensation or claim shall be payable by
Landlord for inconvenience, loss of business or annoyance arising from any
repair or restoration of any portion of the demised premises or of the Building
pursuant to this Article 13.
13.5 Notwithstanding any of the foregoing provisions of this
Article 13, if Landlord or the lessor of any superior lease or the holder of any
superior mortgage shall be unable to collect all of the insurance proceeds
(including rent insurance proceeds) applicable to damage or destruction of the
demised premises or the Building by fire or other cause, by reason of some
action or inaction on the part of Tenant or any of its employees, agents or
contractors, then, without prejudice to any other remedies which may be
available against Tenant, there shall be no abatement of Tenant's rents, but the
total amount of such rents not abated (which would otherwise have been abated)
shall not exceed the amount of uncollected insurance proceeds.
13.6 Landlord will not carry separate insurance of any kind on
Tenant's property, improvements, betterments or Alterations and, shall not be
obligated to repair any damage thereto or replace the same. Tenant shall
maintain insurance on Tenant's property, improvements, betterments or
Alterations and Tenant shall be obligated to repair any damage thereto and
replace the same.
13.7 The provisions of this Article 13 shall be considered an
express agreement governing any cause of damage or destruction of the demised
premises by fire or other casualty, and no statute, rule, law or regulation of
the State of New York or any of its political subdivisions now or hereafter in
force and providing for such a contingency in the absence of an express
agreement (including without limitation Section 227 of the Real Property Law),
shall have application in such case.
ARTICLE 14
CONDEMNATION
14.1 In the event that the whole of the demised premises shall
be lawfully condemned or taken in any manner for any public or quasi-public use,
this Lease and the term and estate hereby granted shall forthwith cease and
terminate as of the date of vesting of title. In the event that only a part of
the demised premises shall be so condemned or taken, then, effective as of the
date of vesting of title, the fixed annual
<PAGE> 40
rent under Article l hereunder and additional rents under Articles 3 and 4
hereunder shall be abated in an amount thereof apportioned according to the area
of the demised premises so condemned or taken. In the event that only a part of
the Building Project (as such term is defined in subsection 3.2(i) hereof) shall
be so condemned or taken, then (a) Landlord (whether or not the demised premises
be affected) may, at Landlord's option, terminate this Lease and the term and
estate hereby granted as of the date of such vesting of title by notifying
Tenant in writing of such termination within sixty (60) days following the date
on which Landlord shall have received notice of vesting of title, or (b) if such
condemnation or taking shall be of fifteen percent (15%) or more of the demised
premises or of a substantial part of the means of access thereto, Tenant may, at
Tenant's option, by delivery of notice in writing to Landlord within thirty (30)
days following the date on which Tenant shall have received notice of vesting of
title, terminate this Lease and the term and estate hereby granted as of the
date occurring six months after the vesting of title, or (c) if neither Landlord
nor Tenant elects to terminate this Lease, as aforesaid, this Lease shall be and
remain unaffected by such condemnation or taking, except that the fixed annual
rent payable under Article 1 and additional rents payable under Articles 3 and 4
shall be abated to the extent hereinbefore provided. In the event that only a
part of the demised premises shall be so condemned or taken and this Lease and
the term and estate hereby granted with respect to the remaining portion of the
demised premises are not terminated as hereinbefore provided, Landlord will,
with reasonable diligence and at its expense, restore the remaining portion of
the demised premises as nearly as practicable to the same condition as it was in
prior to such condemnation or taking. Tenant shall be obligated to repair and
replace its property, improvements, betterments and Alterations.
14.2 In the event of its termination in any of the cases
hereinbefore provided, this Lease and the term and estate hereby granted shall
expire as of the date of such termination with the same effect as if that were
the Expiration Date, and the fixed annual rent and additional rents payable
hereunder shall be apportioned as of such date.
14.3 In the event of any condemnation or taking hereinbefore
mentioned of all or a part of the Building Project, Landlord shall be entitled
to receive the entire award in the condemnation proceeding, including any award
made for the value of the estate vested by this Lease in Tenant, and Tenant
hereby expressly assigns to Landlord any and all right, title and interest of
Tenant now or hereafter arising in or to any such award or any part thereof, and
Tenant shall be entitled to receive no part of such award. Provided that
Landlord's award is not reduced by reason thereof, Tenant may apply for an award
for its moving expenses and trade fixtures.
<PAGE> 41
14.4 It is expressly understood and agreed that the provisions
of this Article 14 shall not be applicable to any condemnation or taking for
governmental occupancy for a limited period.
ARTICLE 15
ACCESS TO DEMISED PREMISES; CHANGES
15.1 Tenant shall permit Landlord to erect, use and maintain
pipes, ducts and conduits in and through the demised premises, provided the same
are installed adjacent to or concealed behind walls and ceilings of the demised
premises. Landlord shall to the extent practicable install such pipes, ducts and
conduits by such methods and at such locations as will not materially interfere
with or impair Tenant's layout or use of the demised premises. Landlord or its
agents or designees, on reasonable notice to Tenant (except in the case of
emergency), shall have the right to enter the demised premises, at reasonable
times during business hours (except in the case of emergency), for the making of
such repairs or alterations as Landlord may reasonably deem necessary for the
Building or which Landlord shall be required to or shall have the right to make
by the provisions of this Lease or any other lease in the Building and, subject
to the foregoing, shall also have the right to enter the demised premises for
the purpose of inspecting them or exhibiting them to prospective purchasers or
lessees of the entire Building or to prospective mortgagees of the fee or of the
Landlord's interest in the property of which the demised premises are a part or
to prospective assignees of any such mortgages or to the holder of any mortgage
on the Landlord's interest in the property, its agents or designees. Landlord
shall exercise reasonable diligence so as to minimize the disturbance, but
nothing contained herein shall be deemed to require Landlord to perform the same
on an overtime or premium pay basis.
15.2 Landlord reserves the right, without the same
constituting an eviction and without incurring liability to Tenant therefor, to
change the arrangement and/or location of public entrances, passageways, doors,
doorways, corridors, possible elevators, stairways, toilets and other public
parts of the Building; provided, however, that access to the Building shall not
be cut off and there shall be no unreasonable obstruction of access to the
demised premises or unreasonable interference with the use or enjoyment thereof.
15.3 In connection with any work performed by Landlord in
accordance with the provisions of this Article 15, upon the completion of such
work, Landlord will restore as closely as reasonably possible any improvements
located on the demised premises to the condition of such improvements prior to
the
<PAGE> 42
commencement of such work by Landlord; provided, however, nothing contained
in this paragraph is meant to (i) limit in any way Landlord's rights to perform
any work or repairs permitted to be performed by this Article 15 or (ii) require
the use of labor on an overtime or premium pay basis to perform such restoration
work on the improvements located on the demised premises.
15.4 Landlord may, during the six (6) months prior to
expiration of the term of this Lease, exhibit the demised premises to
prospective tenants during normal business hours upon reasonable advance notice
to Tenant.
15.5 If Tenant shall not be personally present to open and
permit an entry into the demised premises at any time when for any reason an
entry therein shall be urgently necessary by reason of fire or other emergency,
Landlord or Landlord's agents may forcibly enter the same without rendering
Landlord or such agents liable therefor (if during such entry Landlord or
Landlord's agents shall accord reasonable care to Tenant's property and shall be
liable for any loss, damage or theft) and without in any manner affecting the
obligations and covenants of this Lease.
ARTICLE 16
DEFAULT
16.1 This Lease and the term and estate hereby granted are
subject to the limitation that whenever Tenant shall make an assignment of the
property of Tenant for the benefit of creditors, or shall file a voluntary
petition under any bankruptcy or insolvency law or any involuntary petition
alleging an act of bankruptcy or insolvency shall be filed against Tenant under
any bankruptcy or insolvency law, or whenever a petition shall be filed by or
against Tenant under the reorganization provisions of the United States
Bankruptcy Act or under the provisions of any law of like import, or whenever a
petition shall be filed by Tenant under the provisions of any law of like
import, or whenever a permanent receiver of Tenant or of or for the property of
Tenant shall be appointed, then, Landlord may, (a) at any time after receipt of
notice of the occurrence of any such event, and (b) if such event occurs without
the acquiescence of Tenant, at any time after the event continues for sixty (60)
days, give Tenant a notice of intention to end the term of this Lease at the
expiration of five (5) days from the date of service of such notice of
intention, and upon the expiration of said five (5) day period, this Lease and
the term and estate hereby granted, whether or not the term shall theretofore
have commenced, shall terminate with the same effect as if that day were the
Expiration Date, but Tenant shall remain liable for damages as provided in
Article 18.
<PAGE> 43
16.2 This Lease and the term and estate hereby granted are
subject to further limitation as follows:
(a) whenever Tenant shall default in the payment of any
installment of fixed annual rent, or in the payment of any additional rent or
any other charge payable by Tenant to Landlord, in either case for ten (10) days
after written notice is given to Tenant that such payment shall have become due;
or
(b) whenever Tenant shall do or permit anything to be done,
whether by action or inaction, contrary to or in violation of any of Tenant's
obligations, or, the terms, conditions or provisions hereunder, other than
Tenant's obligations to pay fixed annual rent or additional rent or other
charges under this Lease, and if such situation shall continue and shall not be
remedied by Tenant within twenty (20) days after Landlord shall have given to
Tenant a notice specifying the same, or, in the case of a happening or default
which cannot with due diligence be cured within a period of twenty (20) days and
the continuation of which for the period required for cure will not subject
Landlord to the risk of criminal or civil liability (as more particularly
described in Article 8 hereof) or termination of any superior lease or
foreclosure of any superior mortgage, if Tenant shall not, (i) within said
twenty (20) day period advise Landlord of Tenant's intention to duly institute
all steps necessary to remedy such situation, (ii) duly institute within said
twenty (20) day period, and thereafter diligently and continuously prosecute to
completion all steps necessary to remedy the same and (iii) complete such remedy
within such time after the date of the giving of said notice of Landlord as
shall reasonably be necessary; or
(c) whenever any event shall occur or any contingency shall
arise whereby this Lease or the estate hereby granted or the unexpired balance
of the term hereof would, by operation of law or otherwise, devolve upon or pass
to any person, firm, corporation or other entity other than Tenant, except as
expressly permitted by Article 11; or
(d) whenever Tenant shall abandon the demised premises (unless
as a result of a casualty) and such abandonment shall continue for twenty (20)
days after Landlord shall have given Tenant notice thereof;
(e) whenever Tenant shall default in the due keeping,
observing or performance of any covenant, agreement, provision or condition of
Article 5 hereof on the part of Tenant to be kept, observed or performed and if
such default shall continue and shall not be remedied by Tenant within three (3)
Business Days after Tenant receives a notice specifying the same; or
<PAGE> 44
(f) whenever Tenant shall default with respect to any other
lease between Landlord and Tenant;
then in any of said cases set forth in the foregoing subsections (a), (b), (c),
(d), (e) and (f), Landlord may give to Tenant a notice of intention to end the
term of this Lease at the expiration of three (3) days from the date of the
service of such notice of intention, and upon the expiration of said three (3)
days this Lease and the term and estate hereby granted, whether or not the term
shall theretofore have commenced, shall terminate with the same effect as if
that day were the Expiration Date, but Tenant shall remain liable for damages as
provided in Article 18.
ARTICLE 17
RE-ENTRY BY LANDLORD, INJUNCTION
17.1 If Tenant shall default in the payment of any installment
of fixed annual rent, or of any additional rent or other charges under this
Lease, on any date upon which the same ought to be paid, and if such default
shall continue for ten (10) days after Landlord shall have given to Tenant a
notice specifying such default, or if any of the events described in Article 16
shall occur, Landlord or Landlord's agents and employees may immediately or at
any time thereafter re-enter the demised premises, or any part thereof, either
by summary dispossess proceedings or by any suitable action or proceeding at
law, without being liable to indictment, prosecution or damages therefrom, to
the end that Landlord may have, hold and enjoy the demised premises again as and
of its first estate and interest therein. The word re-enter, as herein used, is
not restricted to its technical legal meaning. In the event of any termination
of this Lease under the provisions of Article 16 or if Landlord shall re-enter
the demised premises under the provisions of this Article 17 or in the event of
the termination of this Lease, or of re-entry, by or under any summary
dispossess or other proceedings or action by reason of default hereunder on the
part of Tenant, Tenant shall thereupon pay to Landlord the fixed annual rent and
additional rent payable by Tenant to Landlord up to the time of such termination
of this Lease, or of such recovery of possession of the demised premises by
Landlord, as the case may be, and shall also pay to Landlord damages as provided
in Article 18.
17.2 In the event of a breach or threatened breach by Tenant
of any of its obligations under this Lease, Landlord shall also have the right
of injunction. The special remedies to which Landlord may resort hereunder are
cumulative and are not intended to be exclusive of any other remedies or means
of redress to which Landlord may lawfully be entitled at any time and Landlord
may invoke any remedy allowed at law or in equity as if specific
<PAGE> 45
remedies were not provided for herein.
17.3 If this Lease shall terminate under the provisions of
Article 16, or if Landlord shall re-enter the demised premises under the
provisions of this Article 17, or in the event of the termination of this Lease,
or of re-entry by or under any summary dispossess or other proceeding or action
by reason of default hereunder on the part of Tenant, Landlord shall be entitled
to retain all moneys, if any, paid by Tenant to Landlord, whether as advance
rent, security or otherwise, but such moneys shall be credited by Landlord
against any fixed annual rent or additional rent due from Tenant at the time of
such termination or re-entry or, at Landlord's option against any damages
payable by Tenant under this Article 17 or Article 18 or pursuant to law.
17.4 Tenant hereby expressly waives any and all rights of
redemption granted by or under any present or future laws in the event of Tenant
being evicted or dispossessed for any cause, or in the event of Landlord
obtaining possession of the demised premises, by reason of the violation by
Tenant of any of the covenants and conditions of this Lease or otherwise.
ARTICLE 18
DAMAGES
18.1 If this Lease is terminated under the provisions of
Article 16, or if Landlord shall re-enter the demised premises under the
provisions of Article 17, or in the event of the termination of this Lease, or
of re-entry, by or under any summary dispossess or other proceeding or action by
reason of default hereunder on the part of Tenant, Tenant shall pay to landlord
as damages, at the election of Landlord, either
(a) a sum which at the time of such termination of this Lease
or at the time of any such re-entry by Landlord, as the case may be, represents
the present value (which present value shall be calculated at a discount rate
equal to the then legal rate of interest on judgments in New York State) of the
excess, if any, of
(i) the aggregate of the fixed annual rent and the additional
rent payable hereunder which would have been payable by Tenant
(conclusively presuming the additional rent to be the same as was
payable for the year immediately preceding such termination except that
additional rent on account of increases in Taxes and Expenses shall be
presumed to increase at the average of the rates of increase thereof
previously experienced by Landlord during the period (not to exceed
three (3) years) prior to such termination) for th
<PAGE> 46
period commencing with such earlier termination of this Lease or the
date of any such re-entry, as the case may be, and ending with the
Expiration Date, had this Lease not so terminated or had Landlord not
so re-entered the demised premises, over
(ii) the aggregate rental value of the demised premises for
the same period, or
(b) sums equal to the fixed annual rent and the additional
rent (as above presumed) payable hereunder which would have been payable by
Tenant had this Lease not so terminated, or had Landlord not so re-entered the
demised premises, payable upon the due dates therefor specified herein following
such termination or re-entry and until the Expiration Date; provided, however,
that if Landlord shall re-let the demised premises during said period, Landlord
shall credit Tenant with the net rents received by Landlord from such
re-letting, such net rents to be determined by first deducting from the gross
rents as and when received by Landlord from such re-letting, the expenses
incurred or paid by Landlord in terminating this Lease or in re-entering the
demised premises and in securing possession thereof, as well as the expenses of
re-letting, including altering and preparing the demised premises for new
tenants, brokers' commissions and all other expenses properly chargeable against
the demised premises and the rental thereof; it being understood that any such
re-letting may be for a period shorter or longer than the remaining term of this
Lease; but in no event shall Tenant be entitled to receive any excess of such
net rents over the sums payable by Tenant to Landlord hereunder, nor shall
Tenant be entitled in any suit for the collection of damages pursuant to this
subsection to a credit in respect of any net rents from a re-letting, except to
the extent that such net rents are actually received by Landlord. If the demised
premises or any part thereof should be re-let in combination with other space,
then proper apportionment on a square foot basis shall be made of the rent
received from such re-letting and of the expenses of re-letting.
If the demised premises or any part thereof be re-let by Landlord for the
unexpired portion of the term of this Lease, or any part thereof, before
presentation of proof of such damages to any court, commission or tribunal, the
amount of rent reserved upon such re-letting shall, prima facie, be the fair and
reasonable rental value for the demised premises, or part thereof, so re-let
during the term of the re-letting.
18.2 Suit or suits for the recovery of such damages, or any
installments thereof, may be brought by Landlord from time to time at its
election, and nothing contained herein shall be deemed to require Landlord to
postpone suit until the date when the term of this Lease would have expired if
it had not been so
<PAGE> 47
terminated under the provisions of Article 16, or under any provision of law, or
had Landlord not re-entered the demised premises. Nothing herein contained shall
be construed to limit or preclude recovery by Landlord against Tenant of any
sums or damages to which, in addition to the damages particularly provided
above, Landlord may lawfully be entitled by reason of any default hereunder on
the part of Tenant. Nothing herein contained shall be construed to limit or
prejudice the right of Landlord to prove for and obtain as liquidated damages by
reason of the termination of this Lease or re-entry of the demised premises for
the default of Tenant under this Lease, an amount equal to the maximum allowed
by any statute or rule of law in effect at the time when, and governing the
proceedings in which, such damages are to be proved whether or not such amount
be greater, equal to, or less than any of the sums referred to in Section 18.1.
ARTICLE 19
LANDLORD'S RIGHT TO PERFORM TENANT'S OBLIGATIONS
19.1 If Tenant shall default in the observance or performance
of any term or covenant on Tenant's part to be observed or performed under or by
virtue of any of the terms or provisions of this Lease, (a) Landlord may remedy
such default for the account of Tenant, immediately and without notice in case
of emergency, or in any other case only provided that Tenant shall fail to
remedy such default after Landlord shall have notified Tenant in writing of such
default and the applicable grace period for curing such default shall have
expired; and (b) if Landlord makes any expenditures or incurs any obligations
for the payment of money in connection with such default including, but not
limited to, reasonable attorneys' fees and expenses, such sums paid or
obligations incurred, with interest at the Interest Rate, shall be deemed to be
additional rent hereunder and shall be paid by Tenant to Landlord within thirty
(30) days after rendition of a bill to Tenant therefor.
ARTICLE 20
QUIET ENJOYMENT
20.1 Landlord covenants and agrees that subject to the terms
and provisions of this Lease, if, and so long as, Tenant keeps and performs in
all material respects each and every covenant, agreement, term, provision and
condition herein contained on the part or on behalf of Tenant to be kept or
performed, then Tenant's rights under this Lease shall not be cut off or ended
before the expiration of the term of this Lease, subject however to ground and
underlying leases and mortgages by anyone claiming by or through Landlord which
affect this Lease
<PAGE> 48
(as provided in Article 25 hereof).
ARTICLE 21
SERVICES AND EQUIPMENT
21.1 Landlord shall, at its cost and expense (but subject to
reimbursement by Tenant pursuant to Article 4 hereof):
(a) provide necessary passenger elevator facilities during
Business Hours (as such term is defined in Article 22 hereof) and shall have at
least one passenger elevator subject to call at all other times. At Landlord's
option, the elevators shall be operated by automatic control or by manual
control, or by a combination of both of such methods. Landlord shall provide
freight elevator service to Tenant upon reasonable notice from Tenant;
(b) maintain, keep in repair and provide the services of the
Building system air-conditioning, heating and ventilating system ("HVAC SYSTEM")
installed by Landlord in accordance with the design criteria annexed hereto as
EXHIBIT E. The aforesaid systems will function when seasonably required during
Business Hours. The cooling season for the purposes of this Lease shall be May
15 through September 15 of each calendar year. Landlord shall have no
responsibility or liability for the ventilating conditions and/or temperature of
the demised premises during the hours or days Landlord is not required to
furnish heat, ventilation or air-conditioning pursuant to this subsection. In
any event, Tenant shall keep entirely unobstructed all the vents, intakes,
outlets and grilles, at all times and shall comply with and observe all
regulations and requirements prescribed by Landlord for the proper functioning
of the heating, ventilating and air-conditioning systems including without
limitation, the lowering and closing of Venetian blinds in the demised premises
during daylight hours. In the event that Tenant shall require air-conditioning,
heating or ventilation at such times as same are not furnished by Landlord,
Tenant shall give Landlord at least 24-hours advance notice of such requirement,
and Tenant agrees to pay the Landlord's prevailing rate therefor as additional
rent.
(c) provide cleaning and janitorial services on Business Days
in accordance with the specifications annexed hereto as EXHIBIT F; provided,
however, Tenant shall pay to Landlord upon ten (10) days notice the costs
incurred by Landlord for (a) extra cleaning work in the demised premises
required because of (i) misuse or neglect on the part of Tenant or its employees
or visitors, (ii) use of portions of the demised premises for preparation,
serving or consumption of food or beverages, data processing or reproducing
operations, private
<PAGE> 49
lavatories or toilets or other special purposes requiring greater or more
difficult cleaning work than office areas, (iii) unusual quantity of interior
glass surfaces, (iv) non-building standard materials or finishes installed by
Tenant or at its request, and (b) removal from the demised premises and the
Building of so much of any refuse and rubbish of Tenant as shall exceed that
ordinarily accumulated daily in the routine of business office occupancy.
Landlord, its cleaning contractor and their employees shall have access outside
of Business Hours to the demised premises and the use (at Tenant's expense) of
light, power and water in the demised premises as reasonably required for the
purpose of cleaning the demised premises in accordance with Landlord's
obligations hereunder; and
(d) furnish hot and cold water for lavatory and office
cleaning purposes and cold water for drinking purposes. If Tenant requires, uses
or consumes water for any other purposes, Tenant agrees to Landlord installing a
meter or meters or other means to measure Tenant's water consumption, and Tenant
further agrees to reimburse Landlord for the cost of the meter or meters and the
installation thereof, and to pay for the maintenance of said meter equipment
and/or to pay Landlord's cost of other means of measuring such water consumption
by Tenant. Tenant shall reimburse Landlord for the cost of all water consumed,
as measured by said meter or meters or as otherwise measured, including, without
limitation, sewer rents.
21.2 Landlord reserves the right to stop the heating,
air-conditioning, elevator, plumbing, electric and other systems when necessary
by reason of accident or emergency or for repairs, alterations, replacements or
improvements, provided that except in case of emergency, Landlord will notify
Tenant in advance of any such stoppage and its estimated duration, and will
proceed diligently with the work necessary to resume such service as promptly as
possible and in a manner so as to minimize interference with the Tenant's use
and enjoyment of the demised premises but nothing herein shall be deemed to
require Landlord to perform the same on an overtime or premium pay basis unless
requested to do so by, and at the expense of, Tenant.
21.3 It is expressly agreed that only Landlord or any one or
more persons, firms or corporations authorized in writing by Landlord will be
permitted to furnish laundry, linen towels, drinking water, ice, food or
beverages and other similar supplies and services to tenants and licensees in
the Building provided the quality thereof and the charges therefor are
reasonably comparable to that of other suppliers of such services. Landlord may
fix, in its own absolute discretion, at any time and from time to time, the
hours during which and the regulations under which such supplies and services
are to be furnished. Landlord expressly reserves the right to act as or to
designate, at any time and from time to time, an exclusive supplier of all or
any
<PAGE> 50
one or more of the said supplies and services, provided that the quality
thereof and the charges therefor are reasonably comparable to that of other
suppliers; and Landlord furthermore expressly reserves the right to exclude from
the Building any person, firm or corporation attempting to furnish any of said
supplies or services but not so designated by Landlord. It is understood,
however, that Tenant or regular office employees of Tenant who are not employed
by any supplier of such food or beverages or by any person, firm or corporation
engaged in the business of purveying such food or beverages, may personally
bring food or beverages into the Building for consumption within the demised
premises by employees of Tenant, but not for resale to or for consumption by any
other tenant. Landlord may fix in its absolute discretion, at any time and from
time to time, the hours during which, and the regulations under which, foods and
beverages may be brought into the Building by regular employees of Tenant.
21.4 Tenant agrees to employ such third-party office
maintenance contractor as Landlord may from time to time reasonably designate,
for all waxing, polishing, lamp replacement, cleaning (other than those cleaning
services Landlord is obligated to furnish) and the maintenance work in the
demised premises, provided that the quality thereof and the charges therefor are
reasonably comparable to that of other contractors. Tenant shall not employ any
other contractor without Landlord's prior written consent, which consent shall
not be unreasonably withheld or delayed.
21.5 Landlord will maintain a listing on the Building
directory for Tenant. Landlord will provide a plaque in the mail room for any
additional names Tenant wishes. Tenant may place a sign, approved by Landlord,
on the entrance doors to the demised premises with Tenant's name. Other than
Tenant's name, Tenant shall place no other names, plaques, signs or the like on
the entrance doors to the demised premises and shall place no names, plaques,
signs or the like elsewhere on the exterior of the demised premises. The listing
of any name other than that of the Tenant, whether on the doors of the demised
premises, on the Building directory, or otherwise, shall not operate to vest any
right or interest in this Lease or in the demised premises or to be deemed to be
the written consent of Landlord mentioned in Article 11 hereof, it being
expressly understood that any such listing is a privilege extended by Landlord
revocable at will by written notice to Tenant.
21.6 Landlord will not be required to furnish any other
services, except as otherwise provided in this Lease.
ARTICLE 22
<PAGE> 51
DEFINITIONS
22.1 The term "LANDLORD" as used in this Lease means only the
owner, or the mortgagee in possession, for the time being of the Land and the
Building or the Building Project (or the owner of a lease of the Building
Project or the Building or of the Land and Building), so that in the event of
any transfer of title to the Building Project or said Land and the Building or
said lease, or in the event of a lease of the Building Project or the Building,
or of the Land and the Building, the said transferor Landlord shall be and
hereby is entirely freed and relieved of all future covenants, obligations and
liabilities of Landlord hereunder, and it shall be deemed and construed as a
covenant running with the land without further agreement between the parties or
their successors in interest, or between the parties and the transferee of title
to the Building Project or said Land and the Building or said lease, or the said
lessee of the Building Project or the Building, or of the Land and the Building,
that the transferee or the lessee has assumed and agreed to carry out any and
all such covenants, obligations and liabilities of Landlord hereunder arising
after such transfer.
22.2 The term "BUSINESS DAYS" as used in this Lease shall
exclude Saturdays, Sundays and the following holidays: New Year's Day, Good
Friday, Memorial Day, Independence Day, Labor Day, President's Day, Thanksgiving
Day and the immediately following day, Christmas Day, and all other days
recognized as
holidays under applicable union contracts.
22.3 "INTEREST RATE" shall mean a rate per annum equal to the
lesser of (a) two percent (2%) above the commercial lending rate announced from
time to time by The Chase Manhattan Bank (or any successor), as its prime rate
for 90-day unsecured loans, or (b) the maximum applicable legal rate, if any.
22.4 "LEGAL REQUIREMENTS" shall mean laws, statutes and
ordinances (including building codes and zoning regulations and ordinances) and
the orders, rules, regulations, directives and requirements of all federal,
state, county, city and borough departments, bureaus, boards, agencies, offices,
commissions and other subdivisions thereof, or of any official thereof, or of
any other governmental public or quasi-public authority, whether now or
hereafter in force, which may be applicable to the Building Project, the Land or
the Building or the demised premises or any part thereof, or the sidewalks,
curbs or areas adjacent thereto (including, without limitation, the Common
Areas) and all requirements, obligations and conditions of all instruments of
record on the date of this Lease.
22.5 "BUSINESS HOURS" shall mean 8:00 A.M. to
6:00 P.M. on Business Days.
<PAGE> 52
ARTICLE 23
INVALIDITY OF ANY PROVISION
23.1 If any term, covenant, condition or provision of this
Lease or the application thereof to any circumstance or to any person, firm or
corporation shall be invalid or unenforceable to any extent, the remaining
terms, covenants, conditions and provisions of this Lease or the application
thereof to any circumstances or to any person, firm or corporation other than
those as to which any term, covenant, condition or provision is held invalid or
unenforceable, shall not be affected thereby, and each remaining term, covenant,
condition and provision of this Lease shall be valid and shall be enforceable to
the fullest extent permitted by law.
ARTICLE 24
BROKERAGE
24.1 Landlord and Tenant each covenant, represent and warrant
that (i) it has had no dealings or communications with any broker or agent in
connection with this Lease other than Benson Commercial Realty, Inc. and CB
Commercial (collectively, "BROKER"),(ii) there is no agreement between Broker
and it with respect to compensation, and (iii) each covenants and agrees to
defend (if Tenant, by counsel of its choosing reasonably acceptable to
Landlord), hold harmless and indemnify the other from and against any and all
cost, expense (including reasonable attorneys' fees and expenses) or liability
for any compensation, commissions or charges claimed by any other broker or
agent with whom the indemnifying party dealt with respect to this Lease or the
negotiation thereof. Tenant's agreement to defend, hold harmless and indemnify
Landlord shall specifically apply to any claim for commission by Benson
Commercial Realty, Inc.
ARTICLE 25
SUBORDINATION
25.1 This Lease is and shall be subject and subordinate to all
ground or underlying leases which may now or hereafter affect the real property
of which the demised premises form a part and to all mortgages which may now or
hereafter affect such leases or such real property, and to all renewals,
modifications, replacements and extensions thereof. The provisions of this
Section 25.1 shall be self-operative and no further instrument of subordination
shall be required. In confirmation of such subordination, Tenant shall promptly
execute
<PAGE> 53
and deliver at its own cost and expense any instrument, in recordable form if
required, that Landlord, the lessor of the ground or underlying lease or the
holder of any such mortgage or any of their respective successors in interest
may request to evidence such subordination.
25.2 In the event of a termination of any ground or underlying
lease, 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 under this Lease will, at the option to be
exercised in writing by the lessor under such ground or underlying lease or such
mortgagee or purchaser, assignee or lessee, as the case may be, either (i)
attorn to it and will perform for its benefit all the terms, covenants and
conditions of this Lease on Tenant's part to be performed with the same force
and effect as if said lessor, such mortgagee or purchaser, assignee or lessee,
were the landlord originally named in this Lease, or (ii) enter into a new lease
with said lessor or such mortgagee or purchaser, assignee or lessee, as
landlord, for the remaining term of this Lease and otherwise on the same terms
and conditions and with the same options, if any, then remaining. The foregoing
provisions of clause (i) of this Section 25.2 shall enure to the benefit of such
lessor, mortgagee, purchaser, assignee or lessee, shall be self-operative upon
the exercise of such option, and no further instrument shall be required to give
effect to said provisions. Tenant, however, upon demand of any such lessor,
mortgagee, purchaser, assignee or lessee agrees to execute, from time to time,
instruments in confirmation of the foregoing provisions of this Section 25.2,
satisfactory to any such lessor, mortgagee, purchaser, assignee or lessee,
acknowledging such subordination and attornment and setting forth the terms and
conditions of its tenancy. Tenant hereby constitutes and appoints Landlord or
its successors in interest to be the Tenant's attorney-in-fact, irrevocably and
coupled with an interest, to execute and deliver such instrument of attornment,
or such new lease, if Tenant refuses or fails to do so promptly upon request.
25.3 Anything herein contained to the contrary
notwithstanding, under no circumstances shall the aforedescribed lessor under
the ground lease or mortgagee or purchaser, assignee or lessee, as the case may
be, whether or not it shall have succeeded to the interests of the landlord
under this Lease, be
(a) liable for any act, omission or default of any prior
landlord so long as such ground lessor or mortgagee shall not be a "related
party" (as that term is defined by the Internal Revenue Code of such prior
landlord); or
(b) subject to any offsets, claims or defenses which
<PAGE> 54
the Tenant might have against any prior landlord; or
(c) bound by any rent or additional rent which Tenant might
have paid to any prior landlord for more than one (1) month in advance or for
more than three (3) months in advance where such rent payments are payable at
intervals of more than one (1) month; or
(d) bound by any modification, amendment or abridgment of the
Lease, or any cancellation or surrender of the same, made without its prior
written approval.
25.4 If, in connection with the financing of the Building, the
holder of any mortgage shall request reasonable modifications in this Lease as a
condition of approval thereof, Tenant will not unreasonably withhold, delay or
defer making such modifications provided such modifications do not increase
Tenant's monetary obligations, change the Term, change the demised premises or
materially increase any other of Tenant's obligations or materially decrease
Tenant's rights under this Lease.
ARTICLE 26
CERTIFICATES OF LANDLORD AND TENANT
26.1 Tenant shall, without charge, at any time and from time
to time, within ten (10) days after request by Landlord, deliver a written
instrument to Landlord or any other person, firm or corporation specified by
Landlord, duly executed and acknowledged, certifying:
(a) that this Lease is unmodified and in full force and effect
or, if there has been any modification, that the same is in full force and
effect as modified and stating any such modification, whether there is any
existing basis to cancel or terminate this Lease, and whether to the best of
Tenant's knowledge Landlord is in default thereunder;
(b) that the term of this Lease has commenced and rent has
become payable thereunder, and that Tenant is in possession of all of the
demised premises;
(c) the amount of the fixed annual rent payable under this
Lease and the dates to which the fixed annual rent and additional rent and other
charges hereunder, have been paid; and
(d) whether or not Tenant has made any claim against Landlord
under this Lease and if so the nature thereof and the dollar amount, if any, of
such claim.
26.2 Landlord agrees, at any time and from time to
<PAGE> 55
time, as requested by Tenant, upon not less than ten (10) days prior notice, to
execute and deliver a statement certifying that this Lease is unmodified and in
full force and effect (or if there have been modifications that the same is in
full force as modified and stating the modifications), certifying the dates to
which the fixed rent and additional rent have been paid, and stating whether or
not, to the best knowledge of the signer, Tenant is an default in performance of
any of his obligations under this Lease, and, if so, specifying each such
default of which the signer may have knowledge.
26.3 Tenant agrees that, except for the first month's rent
hereunder, it will pay no rent under this Lease more than thirty (30) days in
advance of its due date, if so restricted by any existing or future ground lease
or mortgage to which this Lease is subordinated or by an assignment of this
Lease to the ground lessor or the holder of such mortgage, and, in the event of
any act or omission by Landlord, Tenant will not exercise any right to remedy
the default until Tenant shall have given written notice of such act or omission
to the ground lessor and to the holder of any mortgage on the fee or the ground
lease who shall have furnished such lessor's or holder's last address to Tenant,
and until a reasonable period for remedying such act or omission shall have
elapsed following the giving of such notices, during which time such lessor or
holder shall have the right, but shall not be obligated, to remedy or cause to
be remedied such act or omission.
ARTICLE 27
LEGAL PROCEEDINGS WAIVER OF JURY TRIAL
27.1 Landlord and Tenant do hereby waive trial by jury in any
action, proceeding or counterclaim brought by either of the parties hereto
against the other on any matters 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 demised premises, and/or any other claims (except claims for
personal injury or property damage) and any emergency statutory or any other
statutory remedy. It is further mutually agreed that in the event Landlord
commences any summary action or proceeding for non-payment of rent, Tenant will
not interpose and does hereby waive the right to interpose any counterclaim of
whatever nature or description in any such proceeding.
ARTICLE 28
SURRENDER OF PREMISES
28.1 Upon the expiration or other termination of the term of
this Lease, Tenant shall quit and surrender to Landlord
<PAGE> 56
the demised premises, broom clean, in good order and condition, ordinary wear
and tear and damage by fire, the elements or other casualty that Tenant is not
required to repair excepted, and Tenant shall remove all of its property as
herein provided. Tenant's obligation to observe or perform this covenant shall
survive the expiration or other termination of the term of this Lease. If Tenant
remains in possession of the demised premises after the termination of this
Lease without the execution of a new lease, Tenant, at the option of Landlord,
shall be deemed to be occupying the demised premises as a tenant from month to
month, subject to all of the other terms and conditions of this Lease insofar as
the same are applicable to a month-to-month tenancy, but at a monthly rental
equal to 200% of the monthly fixed annual rent, Tax Escalation Payment and
Expense Payment last payable by Tenant hereunder. Nothing contained in this
Section 28.1 shall (i) imply any right of Tenant to remain in the demised
premises after the termination of this Lease without the execution of a new
lease, (ii) imply any obligation by Landlord to grant a new lease or (iii) be
construed to limit any right or remedy that Landlord has against Tenant as a
holdover tenant or trespasser.
ARTICLE 29
RULES AND REGULATIONS
29.1 Tenant and Tenant's servants, employees and agents shall
observe faithfully and comply strictly with the Rules and Regulations set forth
in EXHIBIT G attached hereto and made part hereof entitled "Rules and
Regulations" and such other and further reasonable Rules and Regulations as
Landlord or Landlord's agents may from time to time adopt; provided, however,
that in case of any conflict or inconsistency between the provisions of this
Lease and of any of the Rules and Regulations as originally or as hereafter
adopted, the provisions of this Lease shall control. Reasonable written notice
of any additional Rules and Regulations shall be given to Tenant and any dispute
with respect to the reasonableness of any such additional Rules and Regulations
shall be resolved by arbitration in accordance with the Commercial Arbitration
Rules of the American Arbitration Association. Landlord agrees that it shall not
enforce or fail to enforce any of the Rules and Regulations in a manner so as to
apply the same in an unfairly discriminatory manner with respect to Tenant.
Nothing in this Lease contained shall be construed to impose
upon Landlord any duty or obligation to enforce the Rules and Regulations or the
terms, covenants or conditions in any other lease, against any other tenant of
the Building, and Landlord shall not be liable to Tenant for violation of the
same by any other tenant, its servants, employees, agents, visitors or
<PAGE> 57
licensees.
ARTICLE 30
CONSENTS AND APPROVALS
30.1 Wherever in this Lease Landlord's consent or approval is
required and the lease provides that Landlord shall not unreasonably withhold or
delay such consent or approval, if Landlord shall delay or refuse such consent
or approval, Tenant in no event shall 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 unreasonably withheld
or unreasonably delayed its consent or approval. Tenant's sole remedy shall be
an action or proceeding to enforce any such provision, for specific performance,
injunction or declaratory judgment.
30.2 If Tenant desires to determine any dispute between
Landlord and Tenant as to the reasonableness of Landlord's decision to refuse to
consent to (i) any assignment or subletting in accordance with the provisions of
Article 11 hereof with respect to which Landlord expressly agreed not to
withhold its consent, or (ii) any Alteration pursuant to the provisions of
Article 2 or 6 hereof with respect to which Landlord expressly agreed not to
withhold its consent, such dispute shall be settled and finally determined by
arbitration in the County of New York in accordance with the Commercial
Arbitration Rules of the American Arbitration Association.
ARTICLE 31
NOTICES
31.1 Any notice or demand, consent, approval or disapproval,
or statement required to be given by the terms and provisions of this Lease, or
by any law or governmental regulation, either by Landlord to Tenant or by Tenant
to Landlord, shall be in writing. Unless otherwise required by such law or
regulation, such notice, demand, consent, approvals, statement or disapproval
shall be given, and shall be deemed to have been served and given when such
notice or demand is mailed by registered or certified mail deposited enclosed in
a securely closed post-paid wrapper, in a United States Government general or
branch post office, or official depository with the exclusive care and custody
thereof, or delivered to an overnight delivery service requiring a receipt,
addressed to Landlord or to Tenant at its address set forth on page one (1) of
this Lease (except that after the Commencement Date, Tenant's address, unless
Tenant shall give notice to the contrary, shall be the Building,
<PAGE> 58
directed to the attention of General Counsel). At such time as Tenant or anyone
claiming under or through Tenant first occupies the demised premises for the
conduct of its business, all such notices and demands shall be served or given
to Tenant at the demised premises in lieu of its address on page one (1) hereof.
Either party may, by notice as aforesaid, designate a different address or
addresses for notices, demands, consents, approvals statements or disapprovals.
31.2 In addition to the foregoing, either Landlord or Tenant
may, from time to time, request in writing that the other party serve a copy of
any notice or demand, consent, approval or disapproval, or statement, on one
other person or entity designated in such request, such service to be effected
as provided in Section 31.1 hereof.
ARTICLE 32
NO WAIVER
32.1 No agreement to accept a surrender of this Lease shall be
valid unless in writing signed by Landlord. No employee of Landlord or of
Landlord's agents shall have any power to accept the keys of the demised
premises prior to the expiration or termination of this Lease. The delivery of
keys to any employee of Landlord or of Landlord's agent shall not operate as a
termination of this Lease or a surrender of the demised premises. In the event
of Tenant at any time desiring to have Landlord sublet the premises for Tenant's
account, Landlord or Landlord's agents are authorized to receive said keys for
such purpose without releasing Tenant from any of the obligations under this
Lease. The failure of Landlord to seek redress for violation of, or to insist
upon the strict performance of, any term, provision, covenant or condition of
this Lease or any of the Rules and Regulations set forth herein, or hereafter
adopted by Landlord, shall not prevent a subsequent act, which would have
originally constituted a violation, from having all the force and effect of an
original violation. The receipt by Landlord of rent with knowledge of the breach
of any covenant of this Lease shall not be deemed a waiver of such breach. The
failure of Landlord to enforce any of the Rules and Regulations set forth
herein, or hereafter adopted, against Tenant and/or any other tenant in the
Building shall not be deemed a waiver of any such Rules and Regulations. No
provision of this Lease shall be deemed to have been waived by Landlord, unless
such waiver be in writing signed by Landlord. No payment by Tenant or receipt by
Landlord of a lesser amount than the rent herein stipulated shall be deemed to
be other than on the account of the earliest stipulated rent, nor shall any
endorsement or statement on any check or any letter accompanying any check or
payment of rent be deemed an accord and satisfaction, and Landlord may accept
such check or payment
<PAGE> 59
without prejudice to Landlord's right to recover the balance of such rent or
pursue any other remedy in this Lease provided.
32.2 This Lease contains the entire agreement between the
parties, and any executory agreement hereafter made shall be ineffective to
change, modify, discharge or effect an abandonment of it in whole or in part
unless such executory agreement is in writing and signed by the party against
whom enforcement of the change, modification, discharge or abandonment is
sought.
ARTICLE 33
CAPTIONS
33.1 The captions are inserted only as a matter of convenience
and for reference, and in no way define, limit or describe the scope of this
Lease nor the intent of any provision thereof.
ARTICLE 34
INABILITY TO PERFORM
34.1 If, by reason of (i) strike, (ii) labor troubles, (iii)
governmental preemption in connection with a national emergency, (iv) any rule,
order or regulation of any governmental agency, (v) conditions of supply or
demand which are affected by war or other national, state or municipal
emergency, or any other cause or (vi) any other cause beyond Landlord's
reasonable control, Landlord shall be unable to fulfill its obligations under
this Lease or shall be unable to supply any service which Landlord is obligated
to supply, this Lease and Tenant's obligation to pay rent hereunder shall in no
wise be affected, impaired or excused, except as provided in Section 13.2 and
14.1.
ARTICLE 35
NO REPRESENTATIONS BY LANDLORD
35.1 Landlord or Landlord's agents have made no
representations or promises with respect to the Building or demised premises
except as herein expressly set forth.
ARTICLE 36
NAME OF THE BUILDING PROJECT
36.1 Landlord shall have the full right at any time to name or
change the name of the Building Project or the Building and to change the
designated address of the Building Project or
<PAGE> 60
the Building.
ARTICLE 37
RESTRICTIONS UPON USE
37.1 It is expressly understood that no portion of the demised
premises shall be used as, by or for (i) a bank, trust company, savings bank,
industrial bank, savings and loan association or personal loan bank (or any
branch office or public accommodation office of any of the foregoing), or (ii) a
public stenographer or typist, barber shop, beauty shop, beauty parlor or shop,
telephone or telegraph agency, telephone or secretarial service, messenger
service, travel or tourist agency, employment agency, public restaurant or bar,
commercial document reproduction or offset printing service, public vending
machines, retail, wholesale or discount shop for sale of merchandise, retail
service shop, labor union, school or classroom, governmental or
quasi-governmental bureau, department or agency, including an autonomous
governmental corporation, an advertising agency, a firm whose principal business
is real estate brokerage, or a company engaged in the business of renting office
or desk space.
ARTICLE 38
INDEMNITY
38.1 Tenant shall indemnify, defend and save Landlord harmless
from and against any liability or expense (including, without limitation,
reasonable attorneys fees and expenses) arising from the use or occupation of
the demised premises by Tenant or anyone in the demised premises with Tenant's
permission, or from the breach of this Lease by Tenant, unless the liability or
expense results from the reckless conduct or negligent acts or omissions of
Landlord, its employees, agents or contractors.
ARTICLE 39
SECURITY DEPOSIT
39.1 Tenant has deposited with Landlord the sum of Thirty-Nine
Thousand Six Hundred Sixty-Seven 33/100 Dollars ($39,667.33) as security for the
faithful performance and observance by Tenant of the terms, provisions and
conditions of this Lease. Said sum shall be deposited in an interest-bearing
account, and the interest shall be paid annually to Tenant, provided Tenant is
not in material default hereunder beyond any
<PAGE> 61
applicable notice and grace periods. It is agreed that in the event Tenant
defaults beyond applicable grace periods in respect of any of the terms,
provisions and conditions of this Lease, including, but not limited to, payment
of fixed annual rent and additional rent, Landlord may use, apply or retain the
whole or any part of the security so deposited to the extent required for the
payment of any rent and additional rent or any other sum as to which Tenant is
in default or for any sum which Landlord may expend or may be required to expend
by reason of Tenant's default in respect of any of the terms, covenants and
conditions of this Lease, including but not limited to, any damages or
deficiency in the reletting of the demised premises, whether such damages or
deficiency accrued before or after summary proceedings or other re-entry by
Landlord. In the event that Tenant shall fully and faithfully comply with all of
the terms, provisions, covenants and conditions of this Lease, the security
shall be returned to Tenant at the expiration of this Lease.
39.2 THIS SECTION HAS BEEN INTENTIONALLY DELETED.
39.3 In the event of a sale of the Building or leasing,
conveyance or transfer of the Building, Landlord shall have the right to
transfer the security to the vendee, lessee or transferee and Landlord shall
thereupon be released by Tenant from all liability for the return of such
security; and Tenant agrees to look to the new Landlord solely for the return of
said security; and it is agreed that the provisions hereof shall apply to every
transfer or assignment made of the security to a new Landlord. Tenant further
covenants that it will not assign or encumber or attempt to assign or encumber
the monies deposited herein as security and that neither Landlord nor its
successors or assigns shall be bound by any such assignment, encumbrance,
attempted assignment or attempted encumbrance.
ARTICLE 40
MISCELLANEOUS
40.1 Irrespective of the place of execution or performance,
this Lease shall be governed and construed in accordance with the laws of the
State of New York.
40.2 This Lease shall be construed without regard to any
presumption or other rule requiring construction against the party causing this
Lease to be drafted.
40.3 Except as otherwise expressly provided in this Lease,
each covenant, agreement, obligation or other provision of this Lease on
Tenant's part to be performed shall be deemed and construed as a separate and
independent covenant of Tenant, not dependent on any other provision of this
Lease.
<PAGE> 62
40.4 All terms and words used in this Lease, regardless of the
number or gender in which they are used, shall be deemed to include any other
number and any other gender as the context may require.
40.5 Time shall be of the essence with respect to the exercise
of any option granted under this Lease.
40.6 Except as otherwise provided herein whenever payment of
interest is required by the terms hereof it shall be at the Interest Rate.
40.7 In the event that Tenant is in arrears in payment of
fixed annual rent or additional rent hereunder, Tenant waives Tenant's right, if
any, to designate the items against which any payments made by Tenant are to be
credited, and Tenant agrees that Landlord may apply any payments made by Tenant
to any items it sees fit, irrespective of and notwithstanding any designation or
request by Tenant as to the items against which any such payments shall be
credited.
40.8 Landlord or Landlord's agents have made no
representations or promises with respect to the Building Project or the demised
premises except as herein expressly set forth and no rights, easements or
licenses are acquired by Tenant by implication or otherwise except as expressly
set forth herein. Landlord makes no representation as to the actual rentable
square foot area of the demised premises, the Building, or the other
improvements at the Building Project. By the execution of this Lease, Tenant
hereby accepts possession of the demised premises in the condition in which it
exists on the date hereof "as is" and further agrees that, except as expressly
provided herein, Landlord shall have no obligation to perform any work or make
any installations in order to prepare the demised premises for Tenant's
occupancy. The execution of this lease by Tenant shall be conclusive evidence as
against Tenant, that, on the date hereof, the demised premises and the Building
were in good and satisfactory condition.
40.9 Tenant represents, warrants and covenants that:
(a) Tenant is not an employee benefit plan as defined in
Section 3(3) of the Employee Retirement Income Security Act of 1974, as
amended ("ERISA"), which is subject to Title I of ERISA, nor a plan as
defined in Section 4975(e)(1) of the Internal Revenue Code of 1986, as
amended (each of the foregoing hereinafter referred to collectively as
a "Plan"), nor is Tenant an entity whose assets constitute "plan
assets" of one or more such Plans within the meaning of Department of
Labor Regulation Section 2510.3-101;
<PAGE> 63
(b) Neither Tenant nor any of its affiliates (within the
meaning of Part V(c) of Prohibited Transaction Exemption 84-14 granted
by the United States Department of Labor ("PTE 84-14")) has, or during
the immediately preceding year has exercised, the authority to appoint
or terminate The Prudential Insurance Company of America ("Prudential")
as investment manager of any assets of the employee benefit plans whose
assets are held by Prudential or to negotiate the terms of any
management agreement with Prudential on behalf of any such plan;
(c) Tenant is not a related party of Prudential within the
meaning of Part V(h) of PTE 84-14; and
(d) The representations and warranties in the preceding
subparagraphs (a), (b) and (c) are made for the benefit of the holders
of the mortgages presently encumbering the Building (and their
successors) and shall be deemed to be made for the benefit of such
holders (and their successors). Such representations and warranties
shall not be modified or rescinded without the written consent of such
holders (or their successors).
(e) The execution, delivery and performance by Tenant of this
Lease have been duly authorized by all necessary corporate action.
ARTICLE 41
COMMON AREAS AND PARKING
41.1 Landlord shall provide and shall make available from time
to time within the boundaries of the Land such parking facilities, driveways,
entrances and exits thereto, landscape and planted areas, and other improvements
and facilities, as Landlord shall at any time and from time to time deem
appropriate (all the foregoing being collectively referred to in this Lease as
"COMMON AREAS"). Tenant and its officers, employees, agents, customers and
invitees shall have a nonexclusive right, in common with Landlord and other
tenants and occupants of the Building Project (and their employees and invitees)
and contractors working at the Building Project to whom Landlord has granted or
may hereafter grant rights, to use the Common Areas. The Common Areas shall at
all times be subject to the exclusive control and management of Landlord, and
Landlord shall have the right from time to time to establish, modify and enforce
reasonable rules and regulations with respect to the Common Areas, and Tenant
agrees, after notice thereof, to abide by such rules and regulations and to
cause its officers, employees, agents, customers and invitees to conform
thereto. Landlord shall construct, operate, manage, equip, repair, landscape,
and maintain the Common Areas for their
<PAGE> 64
intended purposes in such manner as Landlord shall, in Landlord's sole
discretion, from time to time determine. Landlord's rights respecting the Common
Areas shall include (but shall not be limited to) the following:
(i) to construct, maintain and operate lighting facilities
serving the Common Areas;
(ii) from time to time to change the area, level, location and
arrangement of parking areas and other Common Area facilities, to make
installations therein and to move or remove such installations, and to
change the location of, or permanently diminish or discontinue the use
of, any portion of the Common Areas provided the number of parking
spaces available for Tenant's use shall not be materially reduced;
(iii) to restrict parking by tenants, their officers, agents,
employees, customers and invitees, to designated areas;
(iv) to discontinue, or restrict the use of, any portion of
the Common Areas to such extent, and for such period of time, as may in
the opinion of Landlord's counsel be necessary to prevent a dedication
thereof or the accrual of any rights to any person or the public
therein;
(v) to temporarily suspend the use of all, or any portion of,
the Common Areas if required to comply with laws or the requirements of
Landlord's insurers or to make any repairs or alterations thereto or if
necessary in connection with the maintenance thereof; and
(vi) to take any other action with respect to the Common
Areas, as Landlord, in its sole discretion, shall determine to be
advisable.
41.2 Tenant's right to use the Common Areas shall be deemed to
be an irrevocable license coterminous with the term of this Lease, and Landlord
shall not be subject to any liability nor shall Tenant be entitled to any
compensation or diminution or abatement of rent by reason of Landlord's exercise
of any right or rights respecting Common Areas reserved pursuant to Section 41.1
hereof, nor shall the exercise of any such right be deemed a constructive or
actual eviction.
41.3 Tenant shall be entitled to free use of a total of
eighteen (18) parking spaces (sixteen (16) unreserved parking spaces in common
with others and two (2) reserved parking space within close proximity to the
Building). Tenant agrees that if Landlord shall designate specific parking
spaces, it or its employees and invitees shall only use such designated parking
<PAGE> 65
spaces. Landlord agrees that it will not designate any such parking spaces in a
discriminatory manner with respect to Tenant.
41.4 With respect to the parking of vehicles at the Building
Project:
(a) If Landlord elects to designate a specific parking area
for Tenant's use, Tenant shall require its personnel and visitors to park their
vehicles only in parking spaces designated by Landlord for Tenant's use for its
personnel and visitors on a "first come, first served" basis. Landlord reserves
the right at all times to redesignate such parking spaces. Tenant, its personnel
and visitors shall not at any time park any trucks or delivery vehicles in any
of the parking areas;
(b) all parking spaces and any other parking areas used by
Tenant, its personnel and visitors will be at their own risk, and Landlord shall
not be liable for any injury to person or property, or for loss or damage to any
automobile or its contents, resulting from theft, collision, vandalism or any
other cause whatsoever;
(c) there shall be no overnight parking and Tenant shall, and
shall cause its personnel and visitors to, remove their automobiles from the
parking area at the end of their working day. If any automobile owned by Tenant
or by its personnel or visitors remains in the parking area overnight and the
same interferes with the cleaning or maintenance of said area (snow or
otherwise), any costs or liabilities incurred by Landlord in removing said
automobile to effectuate cleaning or maintenance, or any damages resulting to
said automobile or to Landlord's equipment or equipment owned by others by
reason of the presence of or removal of said automobile during such cleaning or
maintenance shall be paid by Tenant to Landlord, as additional rent on the rent
payment date next following the submission of a bill therefor; and
(d) Tenant agrees not to use, or permit its employees or
invitees to use, any portion of the parking areas which have been designated for
the exclusive use of another tenant in the Building Project.
ARTICLE 42
EXTENSION OF TERM
42.1 Tenant shall have the right to extend the term of this
Lease for one (1) additional term of one (1) year (the "EXTENSION TERM").
42.2 (a) The Extension Term shall commence on July 1,
<PAGE> 66
2004 and shall end on June 30, 2005. The option contained in this Section 42.2
shall be subject to the following terms and conditions:
(i) Tenant shall give Landlord notice (hereinafter called
the "EXTENSION NOTICE") of its election to extend the term of this
Lease at least nine (9) months prior to the commencement of the
Extension Term;
(ii) Tenant is not in default under the Lease in any material
respect (beyond any applicable grace period) as of the time of the
giving of the Extension Notice and the commencement of the Extension
Term unless Landlord shall waive any such default in writing; and
(iii) The Tenant named herein is the actual occupant of not
less than fifty percent (50%) of the usable area of the demised
premises as of the time of the giving of the Extension Notice and the
commencement of the Extension Term.
(b) The fixed annual rent payable by Tenant to Landlord during
the Extension Term shall be the higher of (i) One Hundred Thirty Thousand Four
Hundred Forty-Four and 50/100 Dollars ($130,444.50) per year, or (ii) the then
fair market rent for the demised premises (as determined in accordance with
Section 42.4 herein).
42.3 THIS SECTION HAS BEEN INTENTIONALLY DELETED.
42.4 (a) After Landlord receives a notice from Tenant as
specified in Section 42.2(i), it shall make the initial determination of the
fixed annual rent for the Extension Term ("LANDLORD'S SUBMITTED RENT"), which
determination will be Landlord's statement of the then fair market rent (as
defined in Section 42.4(b) hereof) of the demised premises. Landlord shall give
notice to Tenant of Landlord's Submitted Rent within thirty (30) days after
receipt of such notice from Tenant. If Landlord and Tenant shall fail to agree
upon the fixed annual rent for the Extension Term, within thirty (30) days after
delivery of such notice by Landlord, then Landlord and Tenant each shall give
notice to the other setting forth the name and address of an arbitrator
designated by the party giving such notice. If either party shall fail to give
notice of such designation within ten (10) Business Days of the end of such
thirty (30) day period, then the arbitrator chosen shall make the determination
alone. If two arbitrators shall have been designated, within thirty (30) days
thereafter such two arbitrators shall make their determinations of fixed annual
fair market rent, as defined in Section 42.4(b), for the Extension Term, in
writing and give notice thereof to each other and to Landlord and Tenant. Such
two arbitrators shall have thirty (30) days after the receipt of notice of each
other's determinations to confer with each other
<PAGE> 67
and to attempt to reach agreement as to the determination of fixed annual rent
for the Extension Term. If such two arbitrators shall concur as to the
determination of such fixed annual rent, such concurrence shall be final and
binding upon Landlord and Tenant. If such two arbitrators shall fail to concur,
then such two arbitrators shall immediately designate a third arbitrator. If the
two arbitrators shall fail to agree upon the designation of such third
arbitrator within five (5) days, then either party may apply to the American
Arbitration Association or any successor thereto having jurisdiction for the
designation of such arbitrator. All arbitrators shall be real estate appraisers
or consultants who shall have had at least ten (10) years continuous experience
in the business of appraising or managing real estate or acting as real estate
agents or brokers in the County of Westchester and shall not be affiliated with
Landlord or Tenant. The third arbitrator shall conduct such hearings and
investigations as he may deem appropriate and shall, within thirty (30) days
after his designation, choose one of the determinations of the two arbitrators
originally selected by the parties, and that choice by the third arbitrator
shall be binding upon Landlord and Tenant. Each party shall pay its own counsel
fees and expenses, if any, in connection with any arbitration under this
Section, including the expenses and fees of any arbitrator selected by it in
accordance with the provisions of this Section, and the parties shall share
equally all other expenses and fees of any such arbitration. The determination
rendered in accordance with the provisions of this Section shall be final and
binding in fixing the fixed annual rent for the Extension Term. The arbitrators
shall not have the power to add to, modify or change any of the provisions of
this Lease.
(b) "FAIR MARKET RENT" for purposes of this Article 42 shall
mean the rental rate that would be paid in an arms-length transaction between a
landlord who is under no compulsion to lease and a tenant who is under no
compulsion to rent the premises in question, based upon the rental market for
comparable premises in comparable buildings in Westchester County under terms
(other than those pertaining to the payment of fixed annual rent) similar to
those in this Lease.
(c) Prior to the determination of the arbitrators, Tenant
shall pay as the fixed annual rent for the Extension Term, the fixed annual rent
payable for the immediately preceding term, and in the event the arbitrators
determine that the fixed annual rent payable pursuant to this Section 42.4 is
more than that being paid by Tenant, then Tenant shall pay the amount of such
underpayment, with interest thereon at the Interest Rate, within thirty-five
(35) days after the arbitrators' determination.
(d) For the purposes of facilitating the computations of sums
due for fair market rent pursuant to Section 42.4(b): the
<PAGE> 68
sums payable pursuant to Articles 3 and 4, as calculated on a per square foot
basis, for the Lease Year immediately preceding the commencement of the
Extension Term shall be subtracted from the gross fixed annual rent for the
Extension Term determined pursuant to this Section 42.4, as calculated on a per
square foot basis; and in computing escalations with respect to such space under
Articles 3 and 4 hereof the Land Tax Base Factor, the Building Tax Base Factor,
the Building Expense Base Factor and the Non-Building Expense Base Factor shall
remain unchanged.
42.5 Except as provided in Section 42.2 hereof, Tenant's
occupancy of the demised premises during the Extension Term shall be on the same
terms and conditions as are in effect immediately prior to the commencement of
the Extension Term, provided, however, that upon the expiration of the Extension
Term Tenant shall have no further right to extend the term of this Lease and
Landlord shall not be required to perform any work to prepare the demised
premises for Tenant's occupancy.
42.6 If Tenant does not send an Extension Notice pursuant to
provisions of Section 42.2, this Article 42 hereof shall have no force or effect
and the term of this Lease shall expire on the last day of the initial term
hereof. At such time as Tenant exercises its option pursuant to this Article 42,
Landlord or Tenant can request the other party hereto to execute an instrument
setting forth the exercise of Tenant's right to extend the term of this Lease
and the last day of the Extension Term.
42.7 At such time as Tenant exercises its right to extend the
term of this Lease as herein provided, the phrases "the term of this Lease" or
"the term hereof" as used in this Lease, shall be construed to include, when
practicable, the Extension Term.
ARTICLE 43
EARLY TERMINATION
43.1 Landlord and Tenant shall each have the option to
terminate this Lease upon the giving of a notice to the other. The notice shall
specify a date for such termination on the last day of a month at least one year
after the giving of the notice. In the event that Landlord shall exercise the
aforesaid option. on or before the date specified in the notice, Landlord shall
remit to Tenant a sum equal to the sum of $5,000, plus an amount equal to
(i)$155 multiplied by (ii) the number of whole months that would have followed
the specified termination date.
<PAGE> 69
IN WITNESS WHEREOF, Landlord and Tenant have respectively
executed this Lease as of the day and year first above written.
PURCHASE CORPORATE PARK
ASSOCIATES, L.P., Landlord
By: PCPA, LLC, the General Partner
By: /s/ Warren L. Schwerin
------------------------------
Warren L. Schwerin,
a Co-Managing Member
INTERLIANT, INC., Tenant
By: /s/ Leonard Fassler
------------------------------
Name: Leonard Fassler
Title: Co-Chairman
<PAGE> 70
EXHIBIT A
SITE PLAN
<PAGE> 71
EXHIBIT B
DESCRIPTION OF LAND
All that certain plot, piece or parcel of land, situate, lying
and being in the Town/Village of Harrison, County of Westchester and State of
New York, being a 42.642 Acre Parcel of land shown and delineated on Map Number
20975 filed in the Office of the Clerk of Westchester County (Division of Land
Records) on July 26th, 1982; said parcel also being a portion of Parcels "C" and
"D" as shown on Map Number 19488 filed in the Office of the Clerk of Westchester
County (Division of Land Records) on May 22nd, 1978, being more particularly
bounded and described as follows:
BEGINNING at a point on the northeasterly side of Route I-684
where the same is intersected by the southerly line of land now or formerly of
Whitelaw Reid, said point being the northwesterly corner of Parcel "C" as shown
on Filed Map No. 19488;
running thence along said land of Whitelaw Reid, the following
courses and distances:
North 72(degree) 13' 05" East 321.205 feet,
North 84(degree) 509' 40" East 333.53 feet,
North 44(degree) 11' 00" East 453.19 feet,
North 48(degree) 58' 00" East 29.71 feet,
North 65(degree) 11' 30" East 200.54 feet and
North 65(degree) 51' 30" East 56.95 feet to the
division line between Parcel "C" and Parcel "F" and the southwesterly corner of
said Parcel "F" as shown on Filed Map No. 19488;
thence easterly along said division line along a curve to the
right having a radius of 600.00 feet, the radial of which at its westerly end
bears North 14(degree) 00' 31" West, said curve having a central angle
22(degree) 38' 22" a distance of 237.079 feet to the division line between
Parcel "B" and Parcel "C" as shown on Filed Map No. 19488;
thence along said division line, South 2(degree) 52' 00" West
720.135 feet to the division line between Parcel "C" and Parcel "B";
thence along said division line, commencing in a northerly
direction along a curve to the left having a radius of 70.00 feet, a central
angle of 271(degree) 27' 23", a distance of 331.65 feet to a point of reverse
curve;
thence along a curve to the right having a radius of 50.00
feet, a central angle of 48(degree) 11' 23" a distance of 42.05 feet to a point
of tangency;
<PAGE> 72
thence continuing along the division line between Parcel "C"
and Parcel "B", South 40(degree) 24' 00" East 693.099 feet to a point of curve;
thence along a curve to the right having a radius of 50.00
feet, a central angle of 64(degree) 21' 26" a distance of 56.162 feet to a
point, said point being a non-tangent intersection on Parcel 228 as shown on
Filed Map No. 20781;
thence along the highway right-of-way, as established
per said filed Map No. 20781 as follows: In a southwesterly
direction along a curve to the left having a radius of 751.20
feet a central angle of 9(degree) 29' 38" a distance of 124.473 feet to
a point of tangency;
South 33(degree) 30' 33" West 447.23 feet,
South 57(degree) 19' 19" West 23.62 feet,
South 72(degree) 58' 51" West 78.52 feet, and
South 67(degree) 39' 54" West 138.766 feet to a non-tangent
intersection with the division line between Parcel "C" and Parcel "D" as shown
on Filed Map No. 19488;
thence along said division line in a northwesterly direction
along a curve to the right having a radius of 400.00 feet, a central angle of
19(degree) 46' 54" a distance of 138.101 feet to a point of tangency and
northeasterly side of Route I-684;
thence along the northeasterly side of Route I-684, the
following courses and distances:
North 63(degree) 19' 08" West 462.679 feet,
South 45(degree) 59' 00" West 593.505 feet,
South 45(degree) 30' 27" West 138.225 feet, and
South 23(degree) 35' 05" West 535.16 feet, to the point and
place of Beginning.
<PAGE> 73
EXHIBIT C
FLOOR PLAN
<PAGE> 74
EXHIBIT D
THIS EXHIBIT HAS BEEN INTENTIONALLY DELETED.
<PAGE> 75
EXHIBIT E
HVAC SPECIFICATIONS
H.V.A.C.:
Year round air conditioning systems capable of providing and maintaining design
criteria as follows:
Design Condition Inside Condition Outside Condition
- ---------------- ---------------- -----------------
Cooling Cycle 76 degr. D.B.F. 90 degr. D.B.F.
50% R.H. 77 degr. W.B.F.
Heating Cycle 65 degr. F. 0 degr. F.
These design standards are based on an occupancy of not more than one (1) person
per 150 square feet and a total connected load not to exceed 3 watts per square
foot for lighting and standard electrical office power, all in accordance with
State and Federal regulations.
The system shall be designed to furnish not less than .05 cubic feet per minute
of fresh air and not less than 1.0 cubic feet per minute of total supply air per
square foot of the premises.
The air conditioning system shall combine use of periphery heating and one (1)
variable volume air conditioning control unit per 1,500 square feet with ceiling
diffusers and thermostatic controls.
<PAGE> 76
EXHIBIT F
CLEANING SPECIFICATIONS
FOR
THE CENTRE AT PURCHASE
GENERAL OFFICE AND PUBLIC AREAS
Daily
1. Sweep or dry mop all resilient tile and wood floors; remove gum, tar,
etc. adhering to floors.
2. Empty and damp wipe all ashtrays.
3. Empty and damp wipe waste baskets.
4. Remove trash to designated area.
5. Dust all horizontal surfaces with treated dust cloths; this includes
furniture, files, equipment, blinds, louvers, etc. that can be reached
without use of a ladder.
6. Damp wipe with germicidal solutions all telephones (including dials and
crevices).
7. Spot clean to remove smudges, marks and fingerprints from walls,
equipment, doors, partitions, light switches, etc. within reach.
8. Wash chalk boards as requested by tenants.
9. Wash water fountains with germicidal solution.
10. Wash cafeteria tables and chairs.
11. Damp mop all non resilient floors such as terrazzo, ceramic tile,
quarry, tile, etc.
12. Thoroughly clean all elevator cabs and landing doors.
13. Clean lobby entrance doors and glass.
14. Turn off all lights when areas have been cleaned.
Weekly
1. Wash glass in display windows, building directory, entrance doors and
show windows, both sides.
2. Spot clean interior partitions and desk glass to remove smudge marks.
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3. Sweep all stair areas.
4. Scrub and recondition resilient tile floors.
5. Brush all fabric covered chairs with lint brush.
6. Vacuum three times weekly.
Monthly
1. Scrub and recondition resilient tile floors using buffable non slip
floor finish.
2. Vacuum all ceiling and wall air supply and exhaust diffusers and
grills.
3. Wash all stairwell landing and treads.
Quarterly
1. High dust all horizontal and vertical surfaces not reached in nightly
cleaning such as pipes, light fixtures, door frames, picture frames,
etc.
2. Vacuum or dust all books in place.
3. Wash and polish vertical terrazzo or marble surfaces.
4. Damp wipe diffusers, vents, grills, etc., including surrounding wall or
ceiling areas that are soiled.
Semi-Annually
1. Wash exterior windows.
Annually
1. Wash light fixtures including reflectors, globes, diffusers and trim.
2. Wash walls in corridors, lobbies and cafeteria.
3. Clean all vertical surfaces not attended to in nightly, weekly, monthly
or quarterly schedules.
RESTROOMS
Daily
1. Clean mirrors, soap dispensers, shelves, basins, exposed plumbing,
dispensers and disposal units using disinfectant solution.
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2. Damp wipe all ledges, toilet stalls and doors.
3. Spot clean light switches, doors and walls.
4. Thoroughly clean commodes and urinals with disinfectant solution.
5. Pour one ounce of bowl cleaner into bowls and urinals when finished
cleaning. Do not flush.
6. Remove all trash to designated area.
7. Refill all soap, toilet tissue and towel and other dispensers.
8. Damp mop tile floors with disinfectant solution.
9. Clean all baseboards.
Weekly
1. Brush all fabric covered chairs and couches in the Ladies lounges with
a lint brush.
Monthly
1. Vacuum all ceiling and wall air supply and exhaust units.
Quarterly
1. High dust all horizontal and vertical surfaces not reached in nightly
cleaning.
2. Damp wash diffusers, vents and grills.
Annually
1. Wash light fixtures.
2. Wash walls with disinfectant solution.
3. Machine scrub floors using disinfectant solutions.
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EXHIBIT G
RULES AND REGULATIONS
1. The sidewalks and public portions of the Building, such as
entrances, passages, courts, elevators, vestibules, stairways, corridors or
halls shall not be obstructed or encumbered by any tenant or used for any
purpose other than ingress and egress to and from the demised premises.
2. No awnings or other projections shall be attached to the
outside walls of the Building. No curtains, blinds, shades, louvered openings or
screens shall be attached to or hung in, or used in connection with, any window
or door of the demised premises, without the prior written consent of Landlord,
unless installed by Landlord.
3. Except as provided in the Lease, no sign, advertisement,
notice or other lettering shall be exhibited, inscribed, painted or affixed by
any tenant on any part of the outside of the demised premises or Building or on
corridor walls. Signs on entrance door or doors shall be subject to Landlord's
approval which shall not be unreasonably withheld. Signs on doors shall, at the
tenant's expense, be inscribed, painted or affixed for each tenant by sign
makers approved by Landlord, which approval shall not be unreasonably withheld.
In the event of the violation of the foregoing by any tenant, Landlord may
remove same without any liability, and may charge the expense incurred by such
removal to the tenant or tenants violating this rule.
4. The sashes, sash doors, skylights, windows, heating,
ventilating and air conditioning vents and door that reflect or admit light and
air into the halls, passageways or other public places in the Building shall not
be covered or obstructed by any tenant, nor shall any bottles, parcels, or other
articles be placed outside of the demised premises.
5. No show cases or other articles shall be put in front of or
affixed to any part of the exterior of the Building, nor placed in the public
halls, corridors or vestibules without the prior written consent of Landlord.
6. Intentionally omitted.
7. The water and wash closets and other plumbing fixtures
shall not be used for any purposes other than those for which they were
constructed, and no sweepings, rubbish, rags, or other substances shall be
thrown therein. All damages resulting from any misuse of the fixtures shall be
borne by the tenant who, or whose servants, employees, agents, visitors or
licensees,
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shall have caused the same.
8. No tenant shall in any way deface any part of the demised
premises or the Building of which they form a part. No tenant shall lay
linoleum, or other similar floor covering, so that the same shall come in direct
contact with the floor of the demised premises, and, if linoleum or other
similar floor covering is desired to be used, an interlining of builder's
deadening felt shall be first affixed to the floor, by a paste or other
material, soluble in water, the use of cement or other similar adhesive material
being expressly prohibited.
9. No bicycles, vehicles or animals of any kind (except seeing
eye dogs) shall be brought into or kept in or about the premises. No cooking
shall be done or permitted by Tenant in the demised premises except in
conformity to law and then only in the utility kitchen, if any, as set forth in
Tenant's layout, which is to be primarily used by Tenant's employees for heating
beverages and light snacks. No tenant shall cause or permit any unusual or
objectionable odors to be produced upon or permeate from the demised premises.
10. No space in the Building shall be used for the
manufacturing or distribution or for the storage of merchandise or for the sale
at auction or manufacture, or otherwise of merchandise, goods or property of any
kind.
11. No tenant shall make, or permit to be made, any unseemly
or disturbing noises or disturb or interfere with occupants of the Building or
neighboring buildings or premises or those having business with them, whether by
the use of any musical instrument, radio, talking machine, unmusical noise,
whistling, singing, or in any other way. No tenant shall throw anything out of
the doors, or windows or down the passageways.
12. No tenant, nor any of the tenant's servants, employees,
agents, visitors or licensees, shall at any time bring or keep upon the demised
premises any inflammable, combustible or explosive fluid, or chemical substance,
other than reasonable amounts of cleaning fluids, reproduction fluids and
solvents required in the normal operation of tenant's business offices.
13. No additional locks or bolts of any kind shall be placed
upon any of the doors or windows by any tenant, nor shall any changes be made in
existing locks or the mechanism thereof, without the prior written approval of
the Landlord and unless and until a duplicate key is delivered to Landlord,
except with respect to security areas so designated by Tenant, which shall in no
event exceed five percent (5%) of the rentable area of the demises premises.
Each tenant must, upon the termination of his tenancy, restore to the Landlord
all keys of stores, offices and toilet rooms, either furnished to, or otherwise
procured by, such
<PAGE> 81
tenant, and in the event of the loss of any keys, so furnished, such tenant
shall pay to Landlord the cost thereof.
14. All removals, or the carrying in or out of any safes,
freight, furniture or bulky matter of any description must take place during the
hours which Landlord or its agent may determine from time to time. Landlord
reserves the right to inspect all freight to be brought into the Building and to
exclude from the Building all freight which violates any of these Rules and
Regulations or the Lease of which these Rules and Regulations are a part.
15. Intentionally omitted.
16. Landlord shall have the right to prohibit any advertising
by any tenant mentioning the Building which, in Landlord's reasonable opinion,
tends to impair the reputation of the Building or its desirability as a building
for offices, and upon written notice from Landlord, tenants shall refrain from
or discontinue such advertising.
17. In order that the Building can and will maintain a uniform
appearance to those outside of same, each tenant in building perimeter areas
shall (a) use only building standard lighting in areas where lighting is visible
from the outside of the Building and (b) use only building standard venetian or
vertical blinds in window areas which are visible from the outside of the
Building.
18. Landlord reserves the right to exclude from the Building
between the hours of 6:30 p.m. and 7:30 a.m. and at all hours on non-business
days all persons who do not present a pass to the Building signed by a tenant.
Each tenant shall be responsible for all persons for whom such pass is issued
and shall be liable to Landlord for all acts of such persons.
19. The premises shall not be used for lodging or sleeping or
for any immoral or illegal purpose.
20. The requirements of tenants will be attended to only upon
application at the office of the Building. Building employees shall not perform
any work or do anything outside of their regular duties, unless under special
instructions from the office of the Landlord.
21. Intentionally omitted.
22. Canvassing, soliciting and peddling in the Building are
prohibited and each tenant shall cooperate to prevent the same.
23. There shall not be used in any space, or in the
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public halls of any building, either by any tenant or by jobbers or others, in
the delivery or receipt of merchandise, any hand trucks, except those equipped
with rubber tires and side guards. No hand trucks shall be used in passenger
elevators which have not been prepared for use to carry freight.
24. Tenants, in order to obtain maximum effectiveness of the
cooling system, shall lower and/or close venetian or vertical blinds or drapes
when sun's rays fall directly on windows of demised premises.
25. After the initial work, replacement of ceiling tiles after
they are removed for Tenant by telephone company installers, in the public
corridors, will be charged to Tenant on a per tile basis.
Whenever and to the extent that the above rules conflict with
any of the rights or obligations of Tenant pursuant to the provisions of the
Articles of this Lease, the provisions of the Articles shall govern.
<PAGE> 83
EXHIBIT H
THIS EXHIBIT HAS BEEN INTENTIONALLY DELETED.
